OFX Group Limited (OFX) Earnings Call Transcript & Summary

Well, it's a very, very warm welcome to the OFX Investor Day for 2023. I'm delighted to have the global executive team either here in person or participating online, except for Sarah Webb, who is our Regional President for EMEA, and it's not a great time zone for her. But we can certainly take any questions around our European business, if you have them. I'm also joined by Patricia Cross, our Chair, and we're supported as always, by our friends at Citadel-MAGNUS Madd -- Maddy. And I'd also, apart from the welcome to the folks here in person, a big welcome to those participating online. We've got over 50 different investors and potential investors participating online. And I think this is a terrific time to talk about strategy. We think about strategy as being a set of choices given the constraints. And we know that investors value companies that are thoughtful about the way they deploy capital. We know that Boards pay considerable time and attention to strategy and times like these, when it really pays to be very, very thoughtful about the choices you have and the choices you actually make. So we are going to have a really good conversation about our strategy, the choices we have made and the choices we're making going forward. Let's move to the agenda, please. In terms of this morning, I'll kick it off with a performance update and give you a sense of how we're trading through the fourth quarter and where we expect to land the year. Then I'm going to walk you through the strategy pieces, how we're thinking about it, where we're heading. Then Selena is going to share with you where that implies from a financial perspective, how we create a more valuable company. And fundamentally, for investors, we know that's what we're trying to do here. But also for employees and for clients. When you got a more valuable company, you create more certainty, more engagement. And with that, you get a much stronger company through the cycle. So we'll share a little bit about that. And then Elaine Herlihy, our Chief Marketing and Product Officer, is going to share with you a little around how we go to market, why we believe we've got a winning value proposition and give you a little bit of an insight into our corporate clients [ adding ] value and so forth. And then we'll do Q&A. So I know there's going to be a bunch of questions for me and Selena and possibly for Elaine as well. We'll do that at the end of the first section. For those that are online, you'll see you've got a Q&A panel in your section. Feel free to type in your questions there. We'll see them here, and we will get to you. And for those who are here, please just raise your hand. In fact, thanks to our friends at KPMG, and thank you, Sean, again, for the use of the facility. We've actually got an excellent facility that people can hear very well, but please speak up. All right. Let's jump in. First of all, as no doubt you already see and feel the global economy is going through some substantial gyrations and you would have your own views on what's happening. So I'm just going to touch on a few that we see. The first is that, obviously, we're cycling through a period of substantially rising interest rates and inflation. And again, one of the questions I got asked by the Board is, do you think this is unprecedented or cyclical. Some things are cyclical. I'm old enough to have lived through 1990, dot-com boom of 2008 and operated through those cycles. What I would say is somewhat unprecedented is the combination of factors all happening at once, all globally and also the fact that unemployment has remained relatively low. What that's meant is that we've certainly seen and you've all seen consumer [ confidence ]. And that's pretty much in every market. But what we also saw was corporate confidence tends to follow. And there was definitely a softening of confidence in corporate generally. What we're seeing though in the last sort of 90 days are, I would say, positive signs. First of all, what you're seeing corporates were running down inventories in the kind of through COVID and the second half of last year, they were buying up inventories. There were supply chain constraints. As we started to cycle out, they started to run down inventories, but they're feeling generally a lot more confident. And our ATVs have remained steady in our corporate business, which is a healthy indicator. The second thing that we've actually seen is a softening of the rate of increase of interest rate rises. And that's starting to give people a bit more confidence. I don't think anyone's saying we're at the end yet. But we're certainly past halfway. And indeed, even in the morning's comments from the Fed chair would suggest that they're starting to feel like we're getting toward the end of that. So we've seen our corporate clients start to feel better about prospects. It hasn't yet flowed through to our consumer clients. But certainly, we've seen that. I'd add to that, -- the China reset is a real tailwind for SMEs because what that has done as well is remove a little bit of uncertainty in global supply chain. And most of our SMEs one way or the other are pretty exposed to that. So all in all, we're starting to see a little bit of improvement in conditions and confidence, particularly with our corporate clients. And of course, travel has started to reopen as well. Let's move to the trading update. And against this backdrop, it's pleasing to be able to share with you that we expect to land NOI just slightly below the revised guidance, but above the original guidance and EBITDA in line with the original guidance of $62 million. So NOI at about $214 million. That's really -- the softness there was really around consumer, which again, I think was pretty clearly telegraphed, if you like, around the high-value use cases softening relative to prior periods. I'd also say, the intangible investments coming in at around $18 million is pretty clear evidence that the investment through the cycle is a very, very clear trend for OFX. And in fact, what it's actually saying is we're finding the availability of technology resources and the ambition to go get our technology work done in service of the client, and you're going to hear more about that later is happening. It's real. We're very happy with it, but it has taken intangible investments up to around $18 million. We're obviously delighted with the Firma acquisition. You can see there that we've said on this chart the EPS accretion in year 1 is going to be over 30%. I've been doing M&A for 25 years. There's not too many I've ever seen deliver more than 20% EPS accretion in year 1, much less over 30%. And to add color to that, voluntary attrition in the Firma organization is actually down. We're seeing a very, very good cultural fit from a risk perspective as well. And that's before we've really given them access to a lot of the synergy benefits that are coming in fiscal year '24. So access to systems, access to U.S. licenses. So we're very, very happy with the Firma acquisition. And as you can see on the right-hand side, the NOI number will be slightly ahead second half versus first, which, again, we [ rear ] cycle notwithstanding the headwinds on consumer is a pretty solid result for us. Okay. Let's move over to strategy and then we'll get into Q&A after the next 2 sections. This slide is pretty familiar to you. You've seen it before. And I think familiar's good when things are moving around a lot. It just sets out what we call strategy on a page. And in simple terms, we had a huge opportunity and Elaine will talk about that in a little bit. That opportunity is very macro-driven. Corporates, particularly are increasingly cross-border, supply chains, clients, staff, all of those things these days, they're accessing our different jurisdictions. And we just play into that. Second of all, of course, it's pretty much a kind of bank-held set of markets, if you like. I mean it depends on the jurisdiction, but it's still definitely north of 70% everywhere, in some markets it would be north of 80%. So we think the opportunity is very, very real. As I've said before, our challenge is to not jump at all the butterflies. We've got to be focused about which segments we think we can go access and unlock. And so we've chosen 4: corporate, which are SMEs. We are focused on online sellers through our SMEs, but they're linked up to marketplaces and/or PSPs. Third of all, enterprises who have an embedded cross-border service. And again, seeing Link, which is a share registry business or Wise Tech, which is a global freight forwarding logistics company, and there are more to come on that. And then, of course, high-value consumers. [ Those too ] really want to have that reassurance of a very strong entity to move these large transactions that they typically like to do with a company like OFX. The competitive positioning, I'm not going to go into a lot of detail on this because Elaine is going to kind of walk you through that. But I would emphasize, more than ever the value of digital plus human. Most of our clients use us digitally, over 90% of transactions are digitally completed. But I think since into the last 2 weeks, 4 weeks would remind clients of the value of having a human, when things don't go according to script. And yesterday in our Board meeting, we were actually sharing with the Board examples of how we do payment processing and how we're automating some things, but we've also got people standing by in the event that the client for whatever reason gets it slightly wrong. And that is, in our opinion, a very, very fundamental assumption that it's not always straightforward. So digital plus human. The global operating model, again, it all looks easy on a page to build a technology platform that can operate around the world, to go get the licenses that can operate all around the world, to be able to add companies onto that platform easily, but also teams. What we have spent particularly over the last 5 years doing is putting in place what we call intact teams in our regions. We've got very strong regional presidents. They each have marketing, risk, finance, product, technology resources in region to be able to move at the speed of the client. And that's absolutely essential. It's hard to do, but it's why we can unlock global growth. And all of that should lead to a more valuable company, which we know matters a lot to investors. It matters a lot to us, too, obviously, because -- what we're seeing, particularly now is in the U.S., not last week, the week before, spending a lot of time, that these tech companies are laying people off all over the place. We're seeing that as well with some of the neo banks. Employees like companies that are going to be around tomorrow and the next day, they're going to make payroll. In cycles like this, we're getting fairly good access to talent as well from some of the companies that are falling over. So that's really, really important for employees. And obviously, for investors, high recurring revenue, strong cash flow generation, strong balance sheets trying to manage by adults, a very strong governance through our Board of public company infrastructure. That's who we're trying to be. The eagle eye in all of you will see a little tick on the bottom right, and that's the newer bit. What we are finding and we've been building towards this is this idea that a specialist versus a general -- a specialist has access to a client in ways that a generalist doesn't. This is frankly how cross-border payments can take share for banks. Thanks to so many jobs for our clients are not very good at cross-border bit. We're very, very good at that. But what we want to start to do is attract revenue from the products and services around our cross-border payment. And you've seen our investment in TreasurUp, which is basically a software that helps automate hedging strategies for clients. They're also doing cash flow forecasting for clients now. We've been growing our emphasis in receivables product, all around cross-border payments. Let me be clear on that. But we think over time, we can generate more than just, what I would call, spot FX margin to create a more valuable company. So that's the strategy on a page. Let's jump to the next slide. I think the thing about this is it's working. We're seeing -- the pivot to B2B, particularly generating much better outcomes for us as employees and for investors particularly. You can see the growth in B2B has been very substantial over the last 5 years. And we've moved it from under 50% to basically 2/3 of our revenue now is B2B. And the reason that's valuable is that it generates a lot of recurring revenue. And you can see there 71% to 84%. That is incredibly helpful for us and Selena is going to go into this in a minute because it gives us certainty around investment optionality around growth. We're very, very good and very, very strong at retaining clients and growing with clients. You'll see our transactions per active client go up. Again, that B2B relationship is really at the heart of OFX. And then this global piece as well. And Yung is here, and you heard from Yung last year, he's the President of our APAC region. It's not that we don't love Yung. It's just that the markets are much bigger in Europe and North America. And if you want to grow the company the way we want to grow the company, we've got to just play into bigger pools. And I'm delighted to see the progress, particularly in North America and Europe in the last few years. It's not at the expense of APAC, by the way, APAC is growing too and that make that very, very plain. We still have APAC. So as you can see on the right-hand side as well, a couple of data points there around the CAGR around B2B revenue growth versus consumer. And consumer, you'll see and the result has its usual ups and downs, very, very strong halves or quarter, sometimes that pulled back through the cycle, it's a great business. It generates superior EBITDA margins. It's a great business. We love it. It's just not as reliable as corporate and therefore, we want to access more corporate revenue and B2B revenues. Okay. Next slide, please. What you're also seeing is the industry is starting to change. And I talked a little bit about the economic cycle and what effect that's had on our business and clients generally and economies generally. But it's clearly having a substantial impact on the payments industry and indeed more broadly in the banking space. The, first one is, guess what, as if this is a new lesson, you ought to be focused on risk. And one of the things that the Board and the executive team hold is a very strong belief is there's no great or enduring financial services company that is not built on risk management. Every single one that survived multiple cycles starts with great risk management and OFX has been saying this for years and more than just saying that it's been investing. There's over $3 million invested, we've got 90 plus risk professionals. We don't always onboard clients as fast as some of our digital competitors, and we're going to get better at that, but we're very, very thoughtful about who we take on, how we manage fraud, how we think about cybersecurity, how we think about tail risks to the group. And risk management becomes the thing that not only as I've talked about in the past is your shield, it's your sword. Customers want great risk management. They don't want you to disappear when they need you the most. So that's been a big trend. As you know, we've talked in the past about working with Tier 1 banks. I know that's always been a line in our presentations and people are like so what? Now you're figuring out why that matters as the smaller banks hit the skids. Profitability is also starting to be a bigger focus. And again, it's not that new to me. I've seen this cycle many times before. As interest rates rise and the cost of capital becomes real, a lot of this private financing that came in that started in 2013 at about $7.5 billion, then it went to $15 billion, then it's $25 billion plus. That money was all free and it's kind of like a free option. Now what's happening is it's not free anymore. And companies and investors more importantly, starting to figure out what we need to turn a profit here at some point. That's actually helpful for OFX because they're starting to do things like raise their prices. And in the past, our competitors adding 50% of price overnight. I saw Revolut went from bank free to a minimum of 50 basis points and $4 on a transaction plus your monthly $7, we're a long way from free. And all the folks who said this thing is going to free, it isn't going to free. In fact, what customers are valuing is how do you work with me and you're going to hear from customers later on. How do you work with me as things get more expensive. And I have my own challenges. The second thing is to do that -- the third thing, I should say, is that there's more and more companies that are looking to pivot to earn more from cross-sell. And that's not the same as earning more from the core job that you're doing, which is moving money. Again, I worked in London from 1990 to 2000, I saw all those neobanks come up and say we're going to cross-sell. That's the way we're going to do it. None of them are around today. I saw the same thing in the 2000s. I've seen the same thing in the last decade. Cross-sell is a very, very hard proposition to pull off. But if you're a specialist and you can generate a really strong relationship where you've got a right to make an offer and a better product and a better feature, then you can generate earnings from that core job that you do for clients. And as I've said, we've been adding receivables product. We do more forwards for our clients. We're going to do more and more of this over the next several years in order to improve our returns. And then finally, industry consolidation. And again, you wouldn't be surprised given where we're at in the cycle, all of those companies that were piling into this industry off the basis of great IPO markets, great tech multiples, it's all very different now. And the Firma acquisition has really given the Board, hopefully, you as investors, certainly us as management, considerable confidence that we're going to be an acquirer in this space. And to drive that level of accretion in the first year is a really strong testament. It's also equally important to be thoughtful about what you go after. We are very deeply in the flow. And I've shared with some of you that we've recently appointed Axel to the global executive team. He was running Corporate Development, now runs Strategy and Corporate Development. We as a Board, we as the management team, are very, very thoughtful about our corporate development, and there's lots of opportunities, but we're going to be careful about the ones that we take. But it's certainly nice to have a good strong balance sheet, supportive investors and a track record, that's for sure. So those are things that we're seeing at an industry level. And of course, just to sort of bear that out, profitability does help. Thanks, Maddy. We know that generating an EBITDA margin like we do is not only healthy, creates sustainability. But if you can grow on top of that the old McKinsey's rule of 40, that's a pretty good balance. In fact, that's probably a top decile, maybe top 20% of companies over time through the cycle, generate EBITDA margins and growth that generate at least 40%. And I think you're going to find that the growth piece at any unit economics is going to be harder and harder for folks to justify them. Like I said, when you see those price rises from the competition, you're starting to see that become real. Our job is to continue to do that carefully, but also take advantage of this dislocation. And it is real at the moment. We're certainly having lots of interesting conversations about what's happening in the banking space, what's happening in the regulatory space. This will continue to be an opportunity for OFX over the next several years. Okay. So finally, I'll just kind of close by saying this is the road map to building a more valuable company. And it's a reiteration of everything I said. So I won't take too long. But we've got to be focused on B2B. This is where there is so much opportunity and it continues to grow, whether it's OFX driving it or macro factors that are driving it. And we think we can continue to grow our proportion of B2B revenues, particularly as we push our enterprise program as we build better risk products for our clients, we will be a better B2B company. And again, let me be really clear about this. This is not because we can't be a great consumer company for our target segment. It's just that we think we can -- with discretionary capital focus on B2B. Global is where the opportunities are the largest. So that's really where we're going to pay disproportionate time and attention and scalability so that investors get returns is really, really important to us. Just adding a lot of cost every time you add revenue is not the way to run a company. It's certainly not the way to run a mature company. The investments. We're very mindful that the intangible investments are the highest they've ever been. That will flow through D&A. But it's also going to flow through in terms of lower cost to serve, lower operating expenses, generally lower fraud, lower bank fees, all of those things better service. If it doesn't do that, then it's not doing its job. And later on, as I said, you'll hear from Adam Thomas, our CTO; Mark Shaw, our COO; and Kate Svoboda, our Chief People and Culture Officer, how that is translating into real outcomes. We will go down organic. And inorganic, we're very clear about that, and I'll talk to Patricia a little bit later about that in the panel about how she thinks about it and how the Board thinks about it, but it's going to be part of the mix because we frankly have the capability to do it and to do it well. And then finally, as I said, winning as a specialist gives you that opportunity to go be a deeper relationship with our client in the world of cross-border payments. And there's plenty of -- like I said, pitfall is about hitting too far left or right on that. If you get into the world of cross-sell, it can be a real distraction, but you can add a lot of value to that relationship, if you're focused on cross-border payments and doing it well. So with all that, I will hand over to Selena, who is going to share with you how that translates for more valuable company.

Thank you, Skander. So if we go to the Slide 13. [ Right ] chart, this one. Skander's already taken you through that there has been some economic uncertainty through the second half of '23. We are seeing some signs of stabilization, which is great. But what is wonderful to see is how OFX goes through these cycles, whether it's the initial Brexit vote, whether it's COVID, we have consistent performance through these cycles. And really, when you look at it, some of the consistency of performance is really coming from the B2B portfolio. In the B2B portfolio, it's corporate, online sellers and enterprise. The corporates themselves are well diversified. I hope, it's [ right ] at least monthly, creating that reoccurring revenue rate. Reoccurring revenue rate in corporates is over 88% at the moment, which is excellent to drive that consistency and performance through the cycles. And their use cases, whether it's paying suppliers, paying employees, purchasing equipment, they continue to trade through during cycles. You can see the B2B turnover is now 76.2% of the portfolio, up from 57.4% in fiscal year '14. And the CAGR over that time period is over 14%. The other thing that's really nice to see in the portfolio is over this time period, the NOI margins have increased by 8 basis points and that's when you take -- when you exclude same currency. But what's really interesting is typically a B2B transaction is a slightly lower margin than the consumer transaction. So even though we've been growing our B2B business, we've also been making sure that we get that price elasticity and the service we offer, we get our growth [ fast ]. But what is wonderful is the performance through the cycles. If we go to the next slide, we'll have a look at the diversification within other areas of the portfolio. You can see on the left-hand side, we love all 3 regions. We absolutely love all 3 regions. Our core region being APAC, and APAC is Australia, New Zealand, Singapore and Hong Kong, that typically has been [indiscernible] portfolio, and we're starting to see that shift as we've driven and grown globally. It's really nice to see North America now is becoming our largest region, up 42.7%. And you can see the impact of Firma there. So if you look at fiscal year '22 at 28.4%, it has increased, one from organic growth, but also the impact of Firma on the portfolio. We also really like our EMEA region, okay? You may remember, like in December 2020, we got our [indiscernible] license, which allows us to now sell into Europe, which is really exciting, and we're starting the early stages of that growth strategy. Just this year alone, on fiscal year '22, the revenue was up [ more than 5%. ] And over that period, the revenue for EMEA has actually grown by 50% but it's just grown to a slightly lower rate than the others, which is why it's only 14.8% of the portfolio. The other interesting fact about our portfolio is it is a differentiator being this diversified and this global. A lot of our competitors are still quite heavy in their home markets. So if you look at Wise, for example, Wise is 52% of their revenue coming from EMEA. If you look at Payoneer as another example, very much Asia focused, they've got over 56% of revenue coming from just Asia itself. So really nice signs in our portfolio. The other thing is, if you look at the diversification, geographic diversification helps in a couple of ways. One is that economic cycles in each country has slightly different rates, so it's nice to add that diversification to the portfolio. But the other thing that we see in the right-hand side is the currency corridors and also the opportunity for netting, right? So if you look back in 2018, we were very dependent on the Aussie, U.S. dollar. It was a large portion of our trading volumes, okay? What would happen is is Aussie depreciated. If you're trying to buy supplies overseas, particularly in the U.S. or [indiscernible] it would become more expensive to businesses and will kind of slow a little bit, impacting our revenue. Now because we've got the 2-way flows, you can get both sides of that transaction, which is really excellent to see. You can also see on this chart the impact that Firma has had. Look at the CAD U.S. and U.S. CAD. Really good volumes. We're less dependent on Aussie dollar, but really good volumes, but also really nice netting, okay? Really nice netting going in both directions. The other reason the netting matters is when we don't get great netting, we have to move the money with our counterparts, I mean, it does cost us a little bit of money to move the money. So better netting is better economics for every transaction that we can generate and also less risk in the portfolio. The one that we're really excited about is Europe. So as we go to Europe, the one netting there that is -- could be better, is the U.S. euro and euro U.S. As we grow in Europe, that netting should get better. And more diversification will help netting across the portfolio. If we move to the next slide, we'll talk about our investments in our platform. So we talked about this a lot in the past, but just to reiterate, we have a single global platform, okay? Our single global platform runs all 4 segments in corporate, online sellers, enterprise and our high-value consumers. It also runs all our regions on that one platform. Now there are local customizations where required, but we do try and build just one platform [indiscernible]. Okay. You may remember in fiscal year '22, and Skander has highlighted the $18 million that we're going to spend this year on intangible investment. We're going to go through what is that going to deliver and why that numbers come about? You may remember in fiscal year '22, you can see there that we spent $10.5 million in intangible investment. That was -- we were actually expecting to spend more in that year being $12.5 million. But as all companies experienced through that period, there was an absolute war on talent for technology, okay? So despite all the efforts, you couldn't actually get the people to help do the build work that you wanted to do. What we have done this year is we've done -- we've developed [indiscernible] partnerships for technology also start hiring technology outside our core office locations. So this year, the $18 million includes a [indiscernible] change, but it's really exciting to see these tech professionals that we wanted to. If we cover the progress that we've made this year in the fiscal year '23 delivery, it's been a huge year for the company, and we're really proud of what we delivered. As you may remember, in fiscal year '22, we automated the income and payment allocation. Okay, this year. What we did was we did integrate streaming, so we can have the payments coming in more than once a day, which is really exciting and also faster USD payment and processing time. So the hours for processing reduced by 9 hours. The other thing that we implemented was a consumer risk management process, which included biometric identification and verification systems for the world. All regions in the world. As a result of this, our verification in North America, success rate has gone up by 17% and Europe by more than that at 25%, okay? Like all companies, we are investing in cyber and on data privacy and data security. Multi-factor authentication is a big deal. What does it do? It helps us stop -- there's credential stuffing attacks, it helps us stop some of the [indiscernible] net attacks and keeps us safe and secure. But there's always work to do when it comes to cyber and data security. Now the other thing that we have achieved in the year is a Firma integration. It's well on track. We are excited. The first region to go live is Australia, which will happen in April. We are excited to get those customers on to a digital platform, and we're excited to make momentum in that area. If you look at our investments in fiscal year '24 and beyond. [indiscernible] some of these things and a few new things for corporate. So one, it's continuation of that payment engine. Right now, [Audio Gap]. We want to move onboarding a bank from months to weeks. So it's really agile and flexible, also more [indiscernible] payments in more corridors, which allows for lower costs, better customer experience and also bank fee reductions. We completed -- this year, we completed our consumer risk assessment process. In fiscal year '24, we're going to be looking at our corporate risk assessment process. So again, making sure that we flow those corporate [ stories ]as easy as we can, but also make the jurisdictional changes that we need for each region and implement them as well. The other thing that we want to do is corporate and have a single digital platform for corporates. Right now, if you're a corporate, we love our corporates and all of us, you can trade here if you've got a global currency account. That's a slightly different platform than actually if you just want to do a spot or a forward transaction. What we want to create for corporates is one single contemporary corporate platform, where it has all products, but also allows us to offer multiple products and also increase our wallet share of our corporates. If we flip to next slide, we'll have a look at cash, the run-off cash, especially at the moment and how we're working through that cash generation. So if you look at our cash on the left-hand side there, really strong cash. And we've walked you here from half point through to the end of it. Cash itself has gone -- net available cash has gone from $92.9 million it is $88 million. But if you look at the $88 million, $60 million of that is actually available cash. When we take out the $28 million that is held for collateral and bank guarantees. You can see from the flow here, what do we do with that cash? One is we have wonderful products with our customers that generate that cash. We then use that cash to repay our debt repayments and also to invest in our one single global platform for our intangibles. If you look at our debt, we do an update on debt is to fund the Firma acquisition, we took on $100 million of debt. We have been paying down that debt and current debt balance as at the end of February is $70.5 million. So we are well on track to repay the debt within 4 years, okay? The other interesting one on the chart on the left is the collateral reduction. Okay? So collateral that we need to hold with our banks and counterparties should reduce from $49 million to $28 million. Why is this? You may remember in September '22, it was probably one of the most volatile days for currencies and the pound almost hit parity with the U.S. dollar. When that happens, we need to post more collateral with our banking counterparties, but as volatility eases, we can then get that collateral back. Part of this reduction is that -- the other part of the reduction is actually us working with our banking counterparties to ensure that we continue to renegotiate all our agreements and get better collateral outcomes for the company, which allows then more cash for us to invest in growth. We also have been very, very diligent on our cash balances. We are moving cash around the world for our customers. But while we are moving cash around the world from our customers, we're trying to make as much interest as we can as that cash moves. The interest income on the portfolio as of December year-to-date, so the third quarter year-to-date is $1.8 million, okay, which is a nice tick up from what you would have seen in the half point. The other thing that's really important in the events of the last few weeks and the Silicon Valley Bank and other banking issues, we bank with 13 Tier 1 banks, okay? We have cash. Our cash is safe and secure, which is important in this environment. Now if we flip to the next slide, we'll talk about our organic and inorganic growth. Our strategy is to target both, both in organic and inorganic growth. We work really hard to grow organic investments and by investing in our single global platform, our marketing and our wonderful salespeople. If you look over that time period, the 5-year time period, you'll see that the CAGR is 13%, $41 million came from organic growth and $55 million came from inorganic. Inorganic growth is highly strategic and planned, okay? We still believe there will be industry consolidation, okay? So we think -- we believe there are still opportunities out there like the Firmas of the world. We have active conversations. We have conversations with advisers, bankers and competitors all around the world to make sure that we're in the deal flow if that deal flow is happening. But we're also very careful on the opportunities that we look at. Some examples of this is the Firma acquisition and also our investment in TreasurUp. If we look at Firma, Firma is excellent. It was right on strategy, corporate North America from a revenue perspective. We are so happy with how that performance has gone. One, we were able to fund it relatively easy with debt. Two, the performance, revenue year-to-date for Firma versus their same time last year is up 15%, coming from a single-digit growth rate, which is absolutely excellent. And the other thing Firma has delivered, which Skander touched on, is over 30% EPS accretion in year 1. And we're well on the way for our integration and synergies, which we've all committed to the market. You can see the organic -- inorganic growth can deliver -- can deliver speed to sale. So if you look there on the left-hand side, the inorganic growth with the addition of Firma, we basically added 5 years of growth in 1 transaction, which is really nice to see. But you do need to have some patients to find the right opportunity at the right time. We also look for when we're looking at inorganic product differentiation. Our product team are always looking for ways we can competitively differentiate our product, and there's always a decision of buy versus build, okay? TreasurUp is a great example of the buy and not the build. It's an automated FX hedging and risk management platform. And it really is a great opportunity for our corporate clients to be able to use that in the future. Now where we are as a company and being able to position for inorganic growth is we're in a great place, okay? A couple of key things are why we're in a great place for inorganic growth is one is our business and our transactions are relatively easy to integrate. FX businesses don't have really big complex back books, okay? They're also a transaction-based business, which makes migration slightly easier than some of these other complex products out there in the financial services world. We also have one global platform which can scale, and we have a great team with a lot of experience in both M&A and execution. With this, I'll hand over to Elaine, who's going to take us through -- Elaine is our Chief Marketing and Product Officer, and she's going to take us through our strong client engagement.

Thank you, Selena. Good morning, everyone. As Selena mentioned, my name is Elaine Herlihy, I am Chief Marketing and Product Officer at OFX. And I'm really pleased to take you through an overview of the B2B opportunity and how we are capturing it. Slide, please Eddy. Thank you. As Skander mentioned earlier, the cross-border opportunity is absolutely huge. There's an estimated USD 206 billion in revenue from cross-border payments in our target segment. As you can also see from the small box in the corner, our existing market share is small at less than 0.05%. So we have plenty of opportunities to grow. We believe that we have a really strong market proposition versus our competition, which I'll take you through, whether they are a digital player, an incumbent SMB or indeed a bank. To supplement the data on the left, which is from McKinsey in 2019, we've also done some proprietary research to dig deeper into the needs of corporates around FX and the statistics on the right-hand side really refer to Australia, but we have seen some similar themes from the U.S. and elsewhere. Over half of corporates have made an FX transaction with 40% of SMBs trading internationally. The key concerns that corporates have are around being ripped off, a fear almost everybody has but corporates really have this as well as generating a lack of confidence in cross-border trade. In a smaller pulse survey that we did in the U.S., 60% of respondents that they have made an FX transaction. And 37% of those also had fear of being ripped off, their key concern. Adding to this, we conduct qualitative research quite often with our clients, and we get a lot of client feedback. And we can see that these concerns are ongoing, and they are global. Maddy -- on the next side, you can see a really simple summary of the OFX value proposition. Skander mentioned it, Selena has mentioned it, it's digital plus human and you can see how this stacks up [indiscernible]. We know through market research that the key drivers of considerations for businesses are: number one, understanding my needs. Number two, ease of use. And then you have a number of product or service features like a dedicated contact, fair pricing, subservice, multiuser capability and security. What we are seeing in the market is many digital players who are described on the left that serve a micro to small client, mainly on spot transfers. They serve a client who is more price sensitive, providing a good digital value proposition, but a limited service model. On the right-hand side, we have banks. And these tend to be much more focused on service orientation in the larger side of the market. They tend to deal with medium-to-large clients, who want a fuller, broader full-service model with value-based pricing, which is essentially pricing according to the value that your clients see in your service or your product. At OFX, in the middle, we have a sweet spot, we believe, with digital plus human. We offer a great digital service, so our clients can transact online at their convenience. But we know that businesses really value the ability to speak to somebody, when they need and have that human contact with a specialist when they want it or indeed when they need it. This is delivered by our corporate dealers as well as our corporate service team more globally. And as one of our top dealers said to me on a trip some years ago actually when I was in the U.S. Said Elaine, my clients, they don't necessarily want to call me, but they do like to know I'm here. It really captures the views of our corporate clients. We believe that this combination of digital plus human attracts a valuable client, we know we get higher ATVs in our [indiscernible]. And it also allows us to command more attractive margins. Maddy? Moving to Page 21. What we've done here is we have chosen 4 typical corporate competitors and assessed OFX's proposition in comparison. You can see how OFX has a compelling set of capabilities to serve the corporate market well in a single partner, meaning that clients can get more, of their needs met in one place, it saves them time and it saves them money. As you would expect, the ability to move money fast, predictably and at a competitive price is critical. Corporates hate to feel like they're being ripped off. But overall, they are less price sensitive than consumers, and they are more likely to appreciate value for the price that they're paying. And as we know, when we're dealing with people's money, trust, safety and security are critical as again, has been made apparent in the last few weeks. Beyond the spot transfer, though, corporates have a range of additional needs that when answers helps them to run their businesses more efficiently. Focus on helping clients manage risk is really important. Approximately 10% of our corporate book use forwards, for example. This has grown over the last 2 years, and we are focused on growing that further. Volatility potentially impacting both the cost and revenue side of the book for corporates, managing currency risk is absolutely critical. We know how hard corporates work for their revenue and their profit. And it's clear that this is a key need and indeed a gap for our businesses. And that's an area where businesses generally need somebody to help them and to guide them. That gap for SMEs is not as well served from either side of our competitors. You don't get so much of that from the digital players. We're very focused on that spot digital transaction. And on the right-hand side for banks, that focus and that service is really more available for larger clients. And so we believe that, that offer for us, again, hits that sweet spot for OFX. We have the treasury access. We have the risk capability as well as the specialist teams, who can help clients with this need. And as Selena mentioned earlier, the addition of TreasurUp will only help grow that capability for us in the future. Next slide, please Maddy. On this slide, you can see that the focus on corporates is really paying off. Corporates have a more frequent need as we've discussed previously and an ongoing need, about 5x that of a consumer. We are acquiring higher-value clients that's driven both by the average transaction value of our clients plus the frequency of trading. That makes them considerably more profitable and more valuable than the corporate clients that are supported by many of our competitors as well as the human support that we offer through our frontline teams. We have a sophisticated and a mature engagement program for corporates via our marketing [indiscernible]. This includes client journeys that nurture, stimulate and retain corporate clients to maximize that lifetime value and ROI. We have 17, very specific number, 17 corporate joinees that drive the conversion of registrations and secure that second and third transaction. And we know that, that drives adoption. We can trigger communications when we see inactivity outside the client's individual cadence of dealing, which we know actually drives that engagement and retention. We have also a number of additional triggered campaigns prompting the next best action a client can take based on pivotal events in the client life cycle. On top of all of that, we deliver volatility campaigns, a record in this last financial year when the currency meets a specific threshold as well as regular expert currency commentary and risk management education. All of this work has seen both our lapse and our reactivation rates improve in our corporate book. Finally, it's worth noting that we have very high engagement on our client comps. Our marketing opt-in rate is 62%. And in 20-plus years in financial services, I've never seen that statistic. We have a really low unsubscribed rate, again, an indicator for us at 0.22% in this financial year. And you can also see on the right-hand side, we have a high and a steady Net Promoter Score, which demonstrates how our clients value our service. Thank you for your time and attention. I'll hand you back to Skander.

Right. Thank you, Elaine. Thank you, Selena. Maybe Selena, if you want to join me, we've got time now for Q&A. I think we've got 20 minutes. And so what -- the way we'll do this is we'll start with questions here in the room, and then we'll take 2 from the room, and then we'll go online, take 2 and so forth.

So any questions for me and Selena or for Elaine, feel free. Andy?

You talked about -- about $28 million being required for bank capital. How much do you need for working capital to kind of run the business in terms of cash?

Yes. My rule of thumb for working capital, it can change from a month -- approximately $15 million. So I never really let -- we've got a really nice [indiscernible] cash there, but I would always keep about $15 million just on working capital needs. Yes.

Firma. When you talk about onboarding the Firma customers in Australia, is that you talk through that? Is that Firma customers that they already had in Australia that you're onboarding...

Correct. So the way we're doing this migration, what we're actually going to do is they're currently still on Firma systems. We will migrate them across to the OFX systems here in Australia. We've already got them on site. We're already working with them on a -- the Firma dealers are talking to them, with -- you always bring that together, and that will be our first data migration. So we have to bring across their history as well as their current [ sales ].

Do you expect any like kind of attrition related to that kind of migration?

Well, the Firma traders don't think so because as you may be aware, Firma have been trying to drive their own digital program over the last 2 to 3 years. And in fact, the growth in transactions from Firma clients who have gone digital doubled of those that have not. That's even with what I would describe as adverse selection is in the drivers have kept the ones, if you go back to Elaine's chart around high sort of silver glove service, they've very much kept those offline, so to speak. The ones that have gone online have typically been the smaller ones, and they've reacted very well to even to Firma's platform, which would be less than ours. So in fact, no, if anything, and again, for the eagle eye, who would have seen on Elaine's chart, the 14.8% transactions per Firma client versus the 20-something for the OFX corporate client, our goal is to grow and close that gap.

And another nice thing with that migration plan is Australia is the smallest region at 4%, but it's our biggest region. So make sure we get it right first and then we'll flow through to the other regions up to Canada.

Okay. Let's check Maddy, have we got questions online?

We've got one question, which comes from [ Ron Shankar ]. And he said, your peers such as [indiscernible] X and Ys mentioned [indiscernible] in the last few weeks. But they have seen significant increase in new accounts as clients move away from smaller banks. Can you comment on what you've been seeing? And are you benefiting from this?

Yes. So we've definitely seen a lot of interest, and that's because clients who are particularly in the tech sector, are concerned about the support that they're getting from their banks. And so there's certainly been heightened interest. We've also been thoughtful about the way we've messaged that externally. We don't seek to kind of as it were talk down banks or those types of things. In fact, as Selena pointed out, we work with Tier 1 banks. We very much see them as part of the infrastructure. So yes, we've seen good support. And even in the U.S., obviously, that's where it's been a much more acute situation, but we haven't been running great big marketing programs saying you've been let down by such and such come and join OFX. Just to give you also a data point, we actually looked at all clients, who might have or who had an account with SVB, and we looked at our forward positions and how many direct debits and so forth and the exposure was very, very minimal if anything at all. So we're not expecting if anyone's -- that's on anyone's mind, any kind of adverse reaction or outcome from that.

Great. We've got another question from [ Annabel Holden ] who said, how much of the $18 million in R&D spend is driven from cost inflation versus acceleration in activity and how is this spend split between maintenance and upgrades versus a move into broader offerings?

Yes. So the -- there is some inflationary spend in technology costs at the moment. Overall, for our portfolio, I think it was about a 5% salary inflation last year. So a little bit of that will be inflation. We always look at the portfolio of what we're investing in, like what is the core to keep us contemporary versus the new products and how we invest there. We make sure that we've got more in the new products, new offerings, making sure there is revenue-generating items versus that they has to keep the lights on and makes us current contemporary, but we haven't really released the exact splits of that. We can give an update at that the full year.

And just to add to what Selena said, not in the intangible investments, but in the OpEx on that question of maintenance and so on. Clearly, we've been investing in cyber. That's much more of an OpEx-driven cost plus, what you're seeing in technology is a shift across to SaaS-based costs. So you'll see technology OpEx go up for that reason as well, and they could be probably classed as maintenance as we move -- we've moved, and you'll hear Adam talk about this after the break to cloud base and so forth. So there's a lot of those types of SaaS-based cost in technology, which is in the past, not something that we've seen, it's natural. And they're all trying to push price rises, too. So...

Just going to stay on the B2B side, just talk through where some of the major gaps in that product portfolio would be versus some of your peers?

Yes. So in case you couldn't hear that question, what are the major gaps relative to the peers? I thought Elaine's slide, the biggest single thing in our opinion, is corporate purchasing, corporate card, whatever you want to call it, because what it does is, first of all, it provides the corporate client with a really simple tool to make these cross-border payments. Most of you, for example, would be paying your [ Google ] subscriptions or your Salesforce subscriptions. We find a lot of them are just paying with a corporate card. And if that's the most convenient way to do it, then fine. But there's other transactions, travel expenses and so forth [indiscernible] we would regard as incremental to those higher-value transactions. And if the client can bring all that together with OFX, then generally, that's a win for them because it's much, much simpler to manage. The other thing that Selena touched on briefly and so did Elaine is risk. We definitely think that things like what TreasurUp had built around basically automated hedging products, cash flow management products, they are really what -- especially if you move into more midsized corporates, the gaps that we have today that we want to be able to close with software as well as people.

I was going to say a lot of your growth has been driven by ATVs the last couple of years. Your marketing spend versus all your peers would be the lowest. Just talk me through the customer acquisition strategy to get in all of your products?

Yes. So again, if you couldn't hear that the question was around your promo spend seems to be flat or low despite the fact that you're growing. Why don't you spend more money on marketing and win more clients? Is that more or less [indiscernible]. The first thing, I'd say, about the total promo spend is it's really shifted. So although the total amount has more or less been flat, the proportion of B2B has grown very significantly. The typical CAC for an SME is significantly higher than a consumer. And obviously, Selena and Elaine do a lot of work around LTV over CAC. And it's a good trade to make. The challenge with marketing promo expense in the SME segment is how much you can scale to get your target of client. And we're still working on that, and we're still going to do more things in order to grow our clients and a number of new clients, a number of active clients in the corporate space. But what you've seen in the last few years is more of a shift in composition of that promo spend. And I don't know, Elaine, if there's anything you wanted to add to any of that.

Well, I think -- can people hear me or shall I...

Yes, they are saying they can.

They can. Perfect.

The key thing actually, as Skander said, is the shift in marketing spend, where actually it's almost exclusively targeted at corporates now. So where previously we have got a strong consumer book. I always say in OFX, one of the nicest things that we have is the messaging and the proposition that we have for both a corporate plus a high value consumer are quite similar. So you don't have to run separate marketing campaigns or promo campaigns to get both. We target very much corporate, pretty much exclusively actually. There's probably more of that of this spend in North America, but there's still some populations of high-value consumers like [ Snowbird ] for examples, who we -- we want to target, but it's almost exclusively on corporate. So actually, what we're seeing is that spend is being redirected to the primary target audience, but we're still picking up consumers. As Skander also said, the demand -- we tend to spend to demand [indiscernible] market about 5% at the time. You need to be there at that point in which they're choosing you. But equally, we scale up and down our demand to capture and people are looking for us to make sure that we always spend to market.

Any other questions online, Maddy?

Yes. We've got one from [ Daniel Stein ]. Do you need much additional reg capital for a deeper, card or multicurrency account product? Reg capital?

So reg capital. Normally, you've got reg capital if you're holding deposits, which you [indiscernible] as a reg capital? And also, you'd be thinking of just cash that you need to run the business. If you're doing a lot of FX transactions and you've got volatility, you need the collateral with your banks. So as volume grows, if those products would add more volume on the FX space, yes, our collateral requirements would increase, but I wouldn't expect a very significant change in that regulatory capital requirements.

Daniel might -- just to build on that, too. Daniel might be referencing consumer. And that's certainly something that we've seen. Regulators around the world, prudential regulators are looking at companies, which have multicurrency accounts for consumers where, in effect, the consumer's using it as a quasi transactional banking account. And I can tell you, we're going to London in 1990, no one as an Australian could get a bank account. Today, you go there and you open up a Wise account and you're all set. The question is whether the regulator says, that's actually like a deposit account. And that might be where Daniel is going with that, but that is deemed to be a deposit account by our regulators for consumers, then reg capital will follow, but not in the corporate space to Selena's point. Any other questions on the line?

We've got [indiscernible] with his hand up, but can you please type it in the Q&A.

[indiscernible] your customers are using you and one of your competitors, maybe for a service that you don't offer?

Yes. I mean, there's no question when you look at that transaction per active client and you kind of match that with the question here from Owen about how come you're not winning more clients. We must be winning more transactions. We must be winning more wallet share, which then ergo, we don't have all the transactions. So I've touched on the smaller value transactions. We also see, and by all means, ask the client after the break this question. We definitely see over time that we win larger transactions through forwards and so forth and having the service model, but there's plenty more to go. How's [ less ] talking going?

It's not in the Q&A.

All right. [indiscernible]

Just curious, it's been about 12 months since you've more or less took out Firma. Just wondering updates around sort of negotiating the bank fees and things that was one of the things you discussed around [indiscernible]? So good.

So we have been negotiating bank fees. It's nice, but we're going to get synergies through in the fourth quarter. So some banks 2 in particular, we've got that we've reduced fees on because of the volumes, and it's really just matching our price at the moment, which is great. The other thing -- so what we're doing, it's kind of a 2-stage negotiation. We're negotiating one for better price, even though it's not integrated, okay? And then as the integration occurs, those flows from each of the countries will flow through the OFX banking relationships naturally. We will probably onboard some of the Firma banks, as they start to our [indiscernible], our pricing will apply, which is lower than what the Firma pricing is. So we should start to see that through fiscal year '24.

I guess just one follow-up to we got part of the synergy. [ Thesis ] was also giving the Firma traders more access to the licenses and jurisdictions that they can have standalone. I'm just curious how that's also progressed in the last few months as well?

It hasn't progressed. So we're basically being very careful about that because access to our systems and how we actually do that. We haven't -- we take concession until we've got them migrated. They won't get access to that. So that synergy will not happen in fiscal year '24. We expect to complete the migration and some folks will start to get access to that through the year, but we're not banking that synergy until really fiscal year '25. Any other final questions?

Just [indiscernible] you flagged in terms of investment. I'm presuming that's all going through the balance sheet rather than OpEx. And just interested in terms of how you would budget with the $18 million is something that we should expect as a reset going forward or that's well above par to what you'd expect sort of in Q2?

I think $18 million, obviously, is what to expect this year. Next year, we would kind of just in the final stage of budgeting process around about that amount at the moment, we'll give you an update at our full year results. Because of those items that we talked about, it's continuation on the payment, the corporate [indiscernible], which is really important. And what we're really excited about is that corporate platform, and it will take some investment to build that, right.

So some of that will flow through into FY '24 and beyond? Presumably?

Yes, yes.

A couple of questions. There's a few, so I'll deliver them one at a time. So this is from [indiscernible] from MST. Lastly, a lot of positive commentary around B2B and long-term CAGR being strong. What we can't really see is how B2B go to the cycle for the periods where it went backwards. Do you expect to see B2B growth continue into FY '24? And can you add color about how you expect to see it through the cycle?

Yes. But what I'd say is, going back to start of the presentation, sometimes it's important to look at cycles versus unprecedented. And I think we were in a little bit of unprecedented territory, but we still saw a strong B2B performance. And as I touched on, ATVs remained good. I would say there's been times when B2B has grown faster, but still strong performance through the cycle. As Selena touched on, margin accretion. It's why we love this business. And just Elaine, that segment and to Elaine's point, the upside is still there. And the reason why we know we can just generate more growth is just look at the chart on transactions per active client, and that's before we add the product features that we really want to add. And that's before competitive intensity changes as a result of some of the things that I touched on earlier on. So it's a kind of through-the-cycle segment. We're just getting going. We're certainly getting really good, strong [indiscernible] outcomes. And again, for the eagle eyed have a look at the transactions per active client on Firma compared to OFX.

Okay. Second question, do you expect OFX to grow EBITDA in FY '24?

We will update you when we provide full year results.

Third question is the $1.8 million interest income from cash balance being captured in operating revenue or as net interest i.e., is it included in the EBITDA guidance?

It is included in the EBITDA guidance because it's -- where it is captured is between revenue and NOI. It's included in NOI, and therefore, it flows down into EBITDA. Interest expense, though, is a below EBITDA.

And finally, I couldn't understand the EBITDA margin discussion. Is there a possibility you may move to 40% over time? Or was that aspirational? Or how should we think about it?

Okay. I think there was a confusion the 40% is the McKinsey's Rule of 40, where if you take your EBITDA margin, you add your NOI growth, you should end up at 40%. So some have the NOI growth of 20% and EBITDA margins of 20%. We're at 30% EBITDA margin and our NOI growth at around 10% that's your Rule of 40. We're not planning to expand our EBITDA margin to 40% in short term or anything like that, but we definitely see levers around growing EBITDA margin. And that's really where I'm sort of hinting at around the more revenue opportunities through better product for our corporate clients. And of course, as we grow enterprise and admittedly, the growth has been modest, that's typically a higher EBITDA margin segment. And so as that becomes a bigger part of the portfolio, that will also drive EBITDA margin. Right. Well, thank you very much. We're going to take a 15-minute break and then be back and hear from our clients, [indiscernible] on the platform. Thank you. [Break]

It looks like we are officially off mute. I do want to apologize to the folks who are participating online. I know that at some point, we lost [indiscernible], but if you get to see Elaine photo disappear. So you know what she looks like. I think visuals have been restored. For the second half of the morning, we're going to hear from people directly. And to kick that off, we're going to have a client panel. And I'm going to ask Michael Judge, who leads Australia and New Zealand, who reports into Yung to introduce a couple of Australian clients, who are doing well globally. And they're going to share a little bit about their businesses and a little bit about doing business with OFX. After that, we're going to switch into 3 of our executives. So Kate Svoboda, as I said, our Chief People and Culture Officer, is going to lead a panel with Mark Shaw and Adam Thomas to talk about how we're putting this global platform into operation and to life. So Michael, over to you.

Thank you, Skander, and welcome to everyone again today. As mentioned, my name is Michael Judge, and I am the Head of Australia and New Zealand here at OFX, personally very proud to be sitting up on this panel this morning, but it brings me immense delight to be doing so with 2 very long-standing and equally very loyal customers to OFX today. Over the next 20 minutes or so or perhaps even a little bit longer, I'm hoping that both Bede and Tania will be able to share with all of you some of their experiences both past and present, that they have enjoyed with OFX as well as, I suppose, deliver a broader appreciation more than anything in terms of how they use our service, and why it matters to their businesses. There will be an opportunity as well for some questions in the last 5 minutes or so of this morning's panel. So please feel free to direct those our way towards the tail of the conversation. Look, before we do jump in, allow me to introduce firstly, Tania Sayers, welcome Tania. And yourself, Bede Hendren. Thank you so much, guys. Tania Sayers is the Chief Operating Officer at Enviro Technologies, a business that she has been part of for the past 13 years. I actually visited Tania's office a month or 2 ago and still amazed today by the bandwidth of your role. Tania oversees the technical and financial functions within the business. She also has direct oversight and management for its global operations and its global supply chain as well. Bede Hendren. Look, Bede's probably out does us all to some extent today. Bede has been with OFX since 2006. And as a guy, who'd been in the business 13 years myself, I think that's an incredible milestone, and we're very grateful for that, Bede. Bede is look, the Managing Director and the Co-founder of Teed Up Golf Tours, a business he cofounded and established himself in 2003. And later in 2007, he went on to establish Teed Up Golf management. Which owns and manages a number of golf courses, driving ranges and sports facilities here locally. So look, there's some introductions. I think a wonderful place for us to start today and a question that I'd ask of both of you is for everyone's benefit, would you mind just explaining the nature of your business more than anything. And really, once you've done that, you can kind of introduce why foreign exchange is relevant and why foreign exchange matters to both of your businesses. Tania, do you want to kind of kick us off?

Sure -- so there are 2 businesses within the Enviro Technologies portfolio. The one I'll talk about most is [indiscernible]. That is an industrial filtration business. So we supply filtration consumables to industrial customers. Those customers have generally got environmental conditions they need to meet through the regulations. We're a global business, where I have manufacturing -- 3 manufacturing sites in China, 1 in Brazil and in the middle of commissioning a new plant in India. We are, at the moment, 300 people globally, expecting to expand with India to probably around 350 by the end of the year. Because of the nature of our products going into mining, aluminum, alumina, we're dealing with the big mining companies, coal-fired power stations, waste-to-energy, power stations as well. We then ship products globally. So we are truly global and that we manufacture globally, but we also ship product all over the place. Hence, currency is one of our things when we're consolidating everything back into the Australian dollars. I try and put a hedge in place naturally in some instances. But of course, there's always a exposure, especially when we look at our Australian domiciled businesses and that's where our biggest exposure is from an FX point of view, and that's where OFX comes in.

Right, thank you. And Bede, yourself.

Sure. So as I mentioned, our management business has some small OFX teams in terms of paying suppliers. But generally, our travel business is the one where we have the most need for OFX. So we -- when we host or organize a golf tour internationally, which we're now cranking back up again, we always price the tour in the local currency, whether it be U.S. dollars or euros or pounds. And so our clients then at a certain point in time have to convert that to the Australian dollars and pay us. So -- but we host tours, I said to the U.S., we have 4 tours every year that we organized to the Masters of Augusta for the golfers in the room. It's one tournament that most golfers want to get to. And then we also do Scotland, Ireland and South Africa. So that's sort of 4 set tours. And then we mix it up a little bit. We've done tours to the Super Bowl, Rugby World Cup, Kentucky Derby. It's always golf tours, but we tie them with some of the big sporting events that our clients love to go to. So that business is foreign currency needs, and hence, the need for OFX.

Thank you. now look, I mentioned you've both been with us for a extra while, Tania, 2018 and Bede, 2006. But yes, if we test the memory bank a little bit here, let's go back in time firstly. Can you guys remember how you came to hear about OFX and how you initially learned about our business?

So it wasn't had to stretch back the memory to 2006, I can't remember what I had for breakfast this morning. But one of the -- it was obviously early days, I think it was called OzForex back then, an employee called up and just explained what they did. And could they come out and have a chat and quote on a deal. So I think it was in [indiscernible] we got with at the time. We were currently with a big -- with one of the big 4 banks. And so we gave them a sort of a deal to quote on when we were doing a conversion, and the price was extremely competitive compared to the big banks back then. And it was really an easy deal to do over the phone and happened very smoothly and the payment is really quick. So that sort of, I guess, awake us to the opportunity that were competitors to the big banks. And pretty much, I think since then we've done something like 1,600 spot or deals since then. So yes, that was our connection.

And yourself, Tania?

Similar story. I got a phone call, and I do have had a lot of phone calls around FX, but they got me on the right day. And someone was prepared to come out and see me, which I think was one of the things that probably was the draw card. So we had a meeting in the office and they were able to explain some of the products and the offering. When you're running a business, you know that FX is important, but you've got other things that you need to do day-to-day. So for someone to come out and sit down and talk to me and make me feel like an individual was wonderful. And then from there, via email, we were set up and away we went.

Unreal. So it sounds like, obviously, you're both existing bank clients. The FX piece is relevant, but probably underappreciated at the time. Very early on in our relationship, if you cast 12 months forward from when you first started, you were using OFX, again, can you guys just explain to us how you felt the partnership was different to how you were set up with your previous provider and your bank as well. What was different?

For me, I being a financial background, we did a 12-month trial, as I put it, with OFX, and I had my back office record every transaction we did. And at the end of the 12 months, we've saved around $180,000 on our FX just by using OFX rather than the traditional bank that we had been with. So FX then started becoming more of a strategic position for us rather than just going and then doing spots through the bank. So to me, that's probably what those first 12 months. And then from then, we haven't looked back.

I think for us after that first deal, I don't think we ever went back to the bank side of things because it's always significantly pricing better. We might -- maybe the next couple of deals sort of done a comparison. But back then, I hadn't spoken to anyone at the bank. It was all done online. No one had explained to me the difference between spots and forwards and limits, et cetera. It was just completely different. Back then [ Ian ] came out 3, 4 times over those first 12 months to talk through the different products and whatnot, so -- which has particularly helped our business [ instead ].

I think we'll definitely come back to the product piece because it sounds like you're both kind of using a mixture of spot and forward and there's a bit of risk mitigation in how you both operate. But if we fast forward to current state, both of your businesses, no doubt, are very different to what they were back in 2018 and absolutely since 2006. But as of today, I think the question I have with you is what is your experience with OFX? And how have we as a partner of yours delivered to your expectations?

Probably the big differences now is your online platform now is so easy, so we probably using the online platform, which in the early days, it was phone based. We still know that we can pick up and I think [indiscernible] been near 13 years, and then Tania so now we can still pick up the phone if we need to. And 2 or 3 times a year on a particular big deal or if there's something a little bit more complicated, we'll pick up the phone. But generally just the online platform. It's so easy to use. My team can use it. I can oversight and our suppliers get paid pretty quickly. So from my point of view, that's been great.

Very similar. We are able to use the online platform. The online platform allows me to have the different authority levels in place, which is quite important to me. So I can have my back office put deals and there's instructed and then we can authorize them online, and it allows me to print down the dashboards of what folds I'VE got in place to report to the Board around our risk mitigation policy that we had on FX that we review every month from the Board meetings. So I think the online, but also when I -- we've been doing a bit of M&A activity in the last little while and had a lot of larger transactions going through to Canada. So Canadian dollar is not one that I was familiar with. So being able to pick up the phone and talk to someone and look at what's happening was really important as well. I'm not an expert to say sometimes, it's nice to pick up someone and talk to the person. I don't have time to look at what's happening in the market and when announcements are coming out, hoping able to have that information when I need it, not all the time, but when I need it, it's important.

Thank you for that. So look, it's a bit of a platform use case there. And equally, you've already kind of mentioned as well Tania, your use of -- the team in OFX. But I think it'd be really good to just kind of boil down for us a little bit. At a fundamental level, if there were really just one really compelling point which is valuable to your business, which helps you run your business. If I was to challenge you to think about what that one thing would be, would you mind just offering a perspective on that?

I think one, it's trust, and it's knowing that I matter. And I think that is fundamental because when we dealt with the bank but couldn't pick up the phone. If I picked up the phone, I didn't know who I was going to talk to, and I didn't feel like I was just a number and I'd go online for their system and put it in, and I didn't feel like there was anything behind it. So I think having a trusted partner, knowing that if I'm not sure on something I can pick up and ask a dumb question and not feel like I should know the answer to it. So I think that personal touch had really built a trust, which means I don't look anywhere else.

So I think from our part, obviously, the price competitive, which on the big deals that we're doing, every point is a big -- makes a big difference. I think it's pretty rare these days, I think, to have those relationships in any company, someone that's been there like [ John ] if he's here today, he's probably working. For 13 years or yourself for 10. So again, I think what Tania says that, that trust that we know is someone at the end of the line when things might go wrong or it's a complicated deal is to me is invaluable.

We'll hone in a bit more on the service point, something that we're passionate about [indiscernible] . Obviously, we're going to give you a bit of a prompt later in today's Q&A. But whilst we're there, can you explain for us in what typical scenarios or do you have any examples where the human element of our service teams and the relationship kind of really shone through?

I think for me, when COVID obviously had been in the travel business, everybody knows that our business came to a halt. We had 4 deals over -- lined up sort of over the next 6 to 12 months to over our tours. We had to postpone those tours or call them off. And so it was a pretty sort of scary time, picked up the phone. And I think spoke to Joel and whilst we get by margin call, which is obviously understandable managed to come up with an arrangement where we could move the forward deals so we could still put that in place for when the tours could go ahead. So I think without that, I'm not sure we would have probably survived. So if back where I couldn't pick up the phone or I know everyone was sort of panicking those sort of first few weeks, that was probably critical for us to work to get through that. And we can say to our clients that, look, we can postpone the tour and you still come with us and say that was probably the one time that -- the one that stands out.

Fantastic. And what about yourself Tania?

I've probably got one that's quite recent actually this month, where we were moving for us a significant amount of Canadian dollars. I've always used our FX more on the payment side because most of my local customers pay in AD and I'm paying my China plant from Australia in U.S. dollars. So I've always been on the payment side, not on the receivables side. But with one of the businesses we bought, we lent money and they were repaying that back. It was a large deal, and I really wasn't sure what the best way of bringing those Canadian dollars back into the Australian dollar account. I was able to pick up -- drop an e-mail, said that [indiscernible] is always available even when she is on holiday, she's called me. I had a lovely teams meeting with her asking about India. And so she was able to talk through different strategies. What was happening in the market was when the U.S. numbers were coming out on manufacturing that week. Of course, the [ RVA ] was also announcing the beginning of the month. So she then just talked through some of the strategies that I could use if I chose. So we put in some limit orders. I went aggressive, came back into the weekend, fought them back a little bit, but actually ended up having really some probably peak rates in the Canadian, Australian dollar. And on that deal alone, I think there was sort of $30,000 compared to if I've taken the spot, and that was over 4 days. So I've not done limit orders before. That was a conversation. And yes, that's the total.

Fantastic. Great. Great example. Thank you for sharing that. Look, it's often a difficult question to ask in this type of setting, but it'd be great to touch on look a bit of constructive feedback. No, as I said, we've been working together for a couple of years. But I'll ask a very open question in terms of is there anything that we could do as a business a little bit better?

Yes, this is a tricky one to think about because, again, in fact I've been here since 2006, it's been very few wishes. One thing that would be great for our business would be some sort of travel card, OFX travel card, that our tour host can use while they're overseas to pay for dinners and drinks and some of the expenses that come up because at the moment, that is using the Australian credit card and obviously, they still whack us pretty high with the transaction fees and the currency rate. So some sort of travel card would be useful from our point of view.

Yes. For me -- it's probably more a minor niggle as the fact that sometimes the money can take the latency from when I actually pay our debts to when it gets to the other party offshore can be more than a day. Generally, it's the next day, but it can be a little bit longer. So for me, when I'm trying to reconcile, getting my teams to reconcile their accounts globally, and I've got money in transit that's not in the Australian entity, but it hasn't arrived in the China one. So we do manage our business where we don't do payments for the last 3 days of the month. We work around that, but sometimes this can be a little bit inconvenient.

Before we move on, any other constructive feedback? No? So take the opportunity given the group today, but no, that's great. Thank you for sharing. Look, another aspect of how we operate is the competitive environment is certainly not lost on anybody [ over time ]. And the external piece, it's not lost on us. And at the same time, we don't take our relationship for granted, albeit it is a fruitful one and one of significant duration. But out of curiosity more than anything, for either of you get contact to buy competitors? And if you do, why do you choose to stay?

I would get calls monthly, if not more frequently than that from different places on FX. I probably and generally in meetings and busy, so don't take them all. I also -- I do know I am required by our Board to price now met probably once a year, especially on this big deal we did at the beginning of the month, I actually did price with the competitor who didn't come in anywhere close. But I would say, while price is, of course, the most important, even if they came in on the same, I probably wouldn't be doing this switch anyway because, once again, it's around that trusted and long-term partnerships. So -- but I do get a lot of calls, absolutely.

Not so many recently pre-COVID. I think, obviously, a lot of people realize the travel industry is probably not a good one to target at the moment. We haven't had a lot, but I know pre-COVID, again, probably not as many as Tania, but 3 or 4 times a year, someone would ring up and say, hey, they can -- unbeatable on price, et cetera. So we may, again, probably once a year just test the market. But again, they would either come in very similar and not enough to even think about making the jump. And often, they didn't come in cheaper anyway. And again, it's not worth jumping for the relationship point of view. So from my point of view, it hasn't been an issue.

Now a question that I know Skander and Selena get asked a lot about and investors in the room ask us this question quite regularly. But in terms of the increase in transaction value and the increase in transaction frequency that we've certainly seen through parts of our portfolio. And frankly, it's persisted post-COVID. I'm curious to understand whether that's something that you've experienced in your business? And if so, why do you think that's the case?

Well, obviously, in the travel business, it's pretty much 0 for a couple of years there. We pivoted and did some local regional golf tours and Australian-based golf tours really just to keep our team employed along with job saver so we managed to keep everyone on board. But there's now a massive pent-up demand. So this year, our transactions have sort of come back to almost what they were pre-COVID and we see that certainly in the next 2, 3 years, a lot of pent-up demand for travel and for golf tours. So from our point of view, it should be back to pre-COVID level by next year, which is obviously good for us and good for you.

We were quite fortunate not to be really affected by COVID. I didn't have to put anyone on Job seeker or anything like that. We saw a little bit of a downturn in '21 but not really in the Australian market. And then this year, we're seeing a little bit of a downturn in our Chinese business locally, but the rest of the global business, we've been on a CAGR of probably 11% for 5 years and 15% for the last 3, could even do 19%, 20% this year. So we've seen growth across the globe. The industrial sector -- with Russia having sanctions in aluminum, we are seeing that a lot of potlines are coming on stream, especially in South America, even in Australia a little bit. So production is being wrapped up in other areas. When a pipeline has been down, they need to rebag their whole dust collection system. So we've got bags for them. So we've seen a lot of increase from that point of view. So transaction-wise, we've also -- the Board over the last 3 years has been probably a little bit more focused on putting in risk mitigation. So forward covers, I've got a percentage of exposure that needs to be -- have forward cover against. So from that point of view, we've increased the amount of forwards as well as the business increasing and M&A activity for the last 2 -- we've bought another business, as I said, in Canada. This is a filtration business, but it's magnetic ferrous metals and hydraulic oil systems. So into the mining. So now into a little bit about hydraulic oil system. Caterpillar 797s and all these wonderful things. But that M&A activity has been large deals for us. $6 million, $7 million, which is large for us in one go, and we plan to have a few more of those as well. So we don't see our FX requirements reducing any time soon.

But the final question I had for you both is just one around evolution. You both kind of got businesses which have grown year-on-year. And you've had businesses as well, which is frankly operated through some pretty messy cycles. And certainly, today cycle is a little bit different again. You both touched on this, but I kind of want to double-click on the point around risk management. By all accounts, you both kind of use spot, limit orders, forward exchange contracts. Finally, I'd just ask you to share some of those experiences through those product lines. What have you liked about them? And what have you learned through mixing it up a little bit as your business has grown?

Probably the easiest way, I guess, is to give you an example of how we price and run our tour. So the U.S. Masters tour, which is April every year is our biggest tour, and we start selling that 18 months in advance. So we price it in U.S. dollars. So a client bought that tour today, they pay an Australian deposit. They know on the 1st of November this year, we will go to them and say, we're now going to convert the U.S. dollar price to an Australian dollar. And in our terms, we say we'll get the best of the big 4 bank rates on that day. What we actually do is we get a fix and we get a forward deal to probably the end of February. So that's when we have to pay all our suppliers. So there's a 4-month lag from when we get the money from our customers and when we have to pay out our suppliers in the U.S. So we lock in a forward rate. And that's the rate we give to our clients, and it's traditionally always been $0.01 to $0.02 better than the big 4 bank rate anyway. So our clients get a better rate. We have the security of knowing that we've used the same rate that our customers have paid us that we'll pay our suppliers. So since we've been doing the tours, you get the GFC, Brexit COVID, I think the Australian dollar has got as high as $1.10 against U.S. dollar and as low as $0.50. So if we try to pick it, we could obviously -- we could win, but we could also lose pretty badly and be out of business. So a lot of -- what our clients say to me, what do you think the dollar is going to do. And I say, "Well, if I knew that, I'd be going on tours, not [indiscernible] ." Even the experts seem to know and they say one thing and the dollar goes the other. So for us, locking in that forward rate on the 1st of November has been critical to our business that just takes all the risk out of it. We know our supply is going to get paid. So that's been the biggest -- we've looked at limit orders. And we do -- obviously do some spot deals, but 90% of it is forward deals around most tours -- tour payment dates.

And for what it's worth Bede, I'd probably answer the same if your customers ask me the same. And Tania, what's been your experience?

Yes. Unfortunately, I can't back to back the currency quite the same. Some of my lead times are like 9 to 10 months. If I'm bringing fiber from Europe to China to make into yarn, to weave into a cloth, to make a bag, to ship it to Australia, to get it installed. So when you got a 9 months, I really don't price the FX. We keep track of all the contracts, especially if we're doing large government contracts, keep track of that. But for me, it's just more around a risk diversity. So we -- I look at the exposure we've got for the next 6 months. And as a business, we're trying to have 50% of that covered, either through U.S. dollars in the bank that we might have received from customers or through forward cover and everything else is at spot. For me, it's the more around just trying to smooth the ups and downs in the market, not necessarily try and get the best rate at that time because there's no winner in that, it moves around so much. So for me, it's just really around being able to have a bit of predictability and certainty for some of it in the next 6 months. Sometimes we win, sometimes we don't, but that's certainly that's important when I'm reporting that to our Board.

We do have a couple of minutes left. So by all accounts, happy to open your questions up to the floor. Are there any questions either for Bede, Tania or equally myself?

I'm just curious if you've started using the TreasurUp product yet. Is that part of ...

It's not available.

Not available? Okay.

Yet.

Nothing else out there? Okay. Well, a very, very sincere thank you to Bede and Tania. It's a 2-sided thank you, I think, not only for your business over such a long period, particularly for taking the time out of your day to join us today. So thank you again.

Okay. Thanks very much. And as I promised, there's no one who can tell the client experience better than a client. I really appreciate you taking the time out, [ which gave a little to how we internally are taking that [ $100 million ] of change investment then in something that clients value you have from [ tenure and base ]. And to that Kate Svoboda is going to introduce Mark and Adam. And they're going to talk about our global operating system and our technology ] and other platform to make us [indiscernible] . Over to you, Kate.

Thanks, Skander. Thanks very much, and welcome to this panel discussion in which, as Skander just said, we're going to talk about the way in which OFX's technology and operations functions are safe, reliable and scalable platform for our clients along with expert human support when they need it. My name is Kate Svoboda. I'm the Chief People and Culture Officer at OFX. I've been with OFX for just over 2 years now. It's been an exciting 2 years with the company because we've grown pretty significantly in that time and been investing in both our digital platforms and our operations capability to meet the needs of our clients. We've also completed our first acquisition, which, of course, requires a lot of attention and effort to ensure a good integration. I've worked for over 20 years, and that feels like a long time in people teams, in financial services, including banking, funds management and insurance, and I'm now enjoying the fast-paced world of global payments. I'll pass on to you to introduce yourself, Adam.

Hi, everyone. Adam Thomas, Chief Technology Officer. I've been here at OFX for about 4 years now -- just over 4 years. Prior to that, I was in management consulting, working for PwC, IBM and then went into industry and worked at News Corp, and I was the Chief Architect of News Corp in Australia and globally. But I came to OFX in leading up their engineering team and been CTO now for about 2 years.

I'm Mark Shaw, I'm Chief Operating Officer. I've been with OFX just over 5 years, so I've been here to see the progress we've made over that time. And my backgrounds is in Banking and Financial Services. So I've had a variety of a operational and risk management roles in about Australia and New Zealand over the last 20 years. And prior to OFX, I was the Head of Operational Risk and Compliance for Australia at ANZ.

Great. Thank you. I don't need to get the question. You mentioned you've been with OFX for a little over 4 years now. Can you tell us about the technology strategy that you've developed kind of leading at OFX?

Well, in case you haven't been paying attention, we have a single global platform. It's -- that platform has evolved over time, but it's allowed us to evolve and grow into new markets around the world. We've also used it as the reason we emphasize that is because we have teams around the world in our different regions that all operate on that same platform to service set of customers. And so we have a follow-the-sun model, so as Australia goes to bed, the U.K. picks it up. We also innovate our own products, which I'll talk about a bit later. Our platform, most -- the front end is fairly simple for our clients, but most of the development effort is in the back end. So we spend most of our time focusing on compliance, risk management, pricing, and we integrate with different service providers and banks to provide the set of currencies that we enable our currency -- our customers to use. We have a hybrid architecture. So we use a combination of in-house development and global vendors for packages. We like to use software-as-a-service for capabilities that were not unique -- that are not unique to our business like customer management. And that gives us access to a road map and features that we can roll out over time at a fairly low cost to our business. But where we focus our strategic investments is on our internal development on our -- where we want to have differentiation in our product or economies of scale or maybe we even don't want to be locked into a vendor's road map or their pricing models. So for example, we've built an end-to-end payments engine that allows our customers to send money to us in many different ways and then in different regions. And then we can pay that out via our different banking relationships that you heard Skander talked about earlier today. We -- as I said, we're in the cloud. We've always -- we've been in the cloud for a long time, so fairly early adopters in the cloud. But that gives us the ability to be able to roll out change quite quickly and do it in a safe and reliable way. And so our engineering teams are now doing about 20 updates to production every week. We also have found lately in the last 1 to 2 years that wasn't focused until we've been investing the scanner set and more in security. We have a Chief Information Security Officer internally and also a dedicated security team that works across all of our teams to make sure that we kept our customers safe. But we also have an external vendor that provides a 24/7 security operations center, monitoring our logs and our platforms. And if there was a cyber incident, we have a managed detect and response contract in place for them to be able to jump through on the spot. And I guess, lastly, from a talent perspective, we've got -- as it was alluded to before, we have seen a war on talent, particularly in technology here in Australia. And so we've diversified our talent strategy. So we now have OFX's in the technology team all around Australia and New Zealand. And -- but more importantly, we found a global vendor that we can tap into to get access to engineers and we can scale up those teams and scale back them down as necessary. So we still like to keep our IP close to the business, but we can have the ability to respond to business needs.

And in terms of where we're up to in executing on that strategy, where would you say where we are?

Well, I don't think technology strategy has ever finished. It evolves over time as customer expectations change or the business needs. And I think we're making some great progress so far. I'd say we have this advantage. What we've noticed is that the more that we invest in improvements on the customer experience, the more it translates into operational efficiency inside of the company. So for example, if we focus on faster payments, it's great for the customer, but it also means less effort on our side to support those customers -- those transfers. As you heard earlier today, we've been investing a lot in our onboarding process for our consumers in the last 12 months. We can now get the majority of our customers onboarded in units. But when -- if a customer does need to be -- we need to do due diligence on them, we've also been investing in the workflows behind the scenes to be able to automate that process. So it will just speed up that process. In the payment space, we've been doing a lot on the straight-through processing of payments. I think Selena mentioned earlier, that we're now getting very high allocation rates for our customers making payments to us. You've got to appreciate that customers don't always fill in the field in their bank statements exactly as we'd like. And so we have to try and match that money to the client's deal in an automated way. So we've really got a high degree of automation there, which, as I said, improves the speed of their payments, but also reduces the overhead on our side. And lately, we've also been working on making it faster to integrate with new banks. And then I guess that's all great when all the automation works. But when it doesn't work, customers want to be able to call us as we heard earlier. And so we've been investing in our customer management platforms and case management so that we can service the customer better.

Thank you. Mark, maybe you can talk to us about how technology and operations work together at OFX?

OFX very much is a digital business. More than 90% of the transactions are booked online. So the technology is obviously a key part of being able to deliver that service. But I think in financial services and particularly in international payments, it's never true that 100% of payments end-to-end transactions go perfectly, seamlessly with no intervention. And so what's incredibly important is how we work with technology to help solve those issues for customers when things don't work perfectly, combining that experience and understanding of banking and payment systems and processes that our operations people have with systems that help them to resolve the issues for the customer. And so we don't take a 0 operations approach, I guess, at OFX. We're not looking to say that we could automate away all the operations of the company. Instead, what we think about is how to use technology to really augment the capabilities of our people, taking away some of the low value type of processing stuff, automating things that actually are not things that human is going to add a lot of value to so that people can really focus on how to assist the customer or provide better service to the customer. And there's probably a few ways that we've been doing that. So sort of some of the things that Adam just talked about on payments, having this payments engine that we've been developing with direct connections into banking partners and configurable rule sets that allow us to sort of start being able to process payments by best rail automatically, and we can kind of configure that and our operating staff can make quick changes to that. So for example, last weekend, we made quick changes to stop any payments going to Silicon Valley Bank. Until we knew what was happening there. And the ability to do that quickly is obviously incredibly important. And also on the way that payments are allocated back to customers so when customers pay in those payments to us, being able to automatically allocate those without a whole bunch of manual intervention, and it's well over 80% or about 80% of our -- those paymentsv are now allocated with 0 human intervention at all the process just happens automatically. No one needs to start and stop the process which, as Adam says, has improved the speed and in some corridors, that's improving speed up to 40%, but also takes away that manual effort that we need to apply as well. And then onboarding and fraud detection. We're now using biometrics to support the onboarding piece. So using biometrics to scan identity documents, prove identity through video and so forth, which not only provides better control, but it also means we haven't got people manually reviewing identity documents and trying to decide if it's the right person or not, which means they've got more time to really focus in on the red flags. So where are those sort of customers that the identity is good, and we have no concerns that can be straight through process. Where there are something that might not be right, that's where our people tend to focus.

And how do you both drive alignment between the technology and operations options?

Yes. That's with strategy, right? So we have one global strategy. The whole executive team is part of developing that strategy, and that really is about us being very aligned to what we are going to focus on and what we're not going to focus on. And then that flows through to our planning process. And it's really aligned to the key outcomes we're trying to achieve. So it's faster, easier, customer onboarding, fast track of payments better customer service. And we align our teams around those pieces. So we've got people who understand the details around how certain -- how payments through particular countries are going to work or how to verify a company that's operating behind the trust. And those people work with our product and technology teams to really make sure that we can develop technology to support those processes.

I'll add. The way we've organized product and technology is based on outcomes of -- the customer outcome. So we have teams on streams around onboarding client experience, payments, customer management, and we also have enterprise and online sellers as a stream. Each of those streams is about 2 agile teams that work very closely with Mark's team and Gavin's team so that they can focus on customer outcome. We do yearly road mapping. Obviously, we're starting to locking down our plans for FY '24 right now. But we also review those priorities every quarter. And we do find -- generally, we stick to the same plan, but every now and then, we need to change to the priority of those teams. It could be based on external events like a regulatory requirement or a change of strategy internally. And within the teams, we're try and really focus on building up the domain knowledge of the technology team. I've always found in all the teams I've led that the closer that they understand the customer and the commercial outcomes of that stream, the more innovative they can be in their solutions, and they can also talk with the business users in the same language.

Great. And just to sort of keep it all real and a bit in the way Michael asked some of our customers for constructive feedback. I'm going to ask you both where have things gone wrong?

Yes, sure. Doesn't always get it right. I'll give you an example. Several years ago, when I first joined, we used to only do one big release to production every month -- sorry, across all of our teams. And so it was pretty obvious if we broke something, we knew what we broke, and we could either fix it or roll it back. We now have 10 teams working in parallel all deploying into production independently. And as I said, we do about 20 releases per week on average. But that means that if one team deploys something, sometimes it's not obvious if it impacted another team. We did have a case recently, for example, where we misconfigured the outbound e-mails to try and improving deliverability and indirectly caused an issue for the customer service team trying to onboard new customers. So we learn from these mistakes. We put in controls to try and make sure that, that never happens again. But we always make sure that we focus on what's best for the customer.

And how do you also think sort of our culture is helpful in that regard?

I think we try to have a blameless culture when we're investigating the issues. OFX is great at getting everybody to rally behind. It could be a potential M&A or it could be regulatory requirement or whatever. It's small enough that everyone sort of rolls up this leaves and tries to get involved. So I think we have a great culture [indiscernible] .

Okay. So that's a nice segue into people. Where do you see our digital plus human offering becoming more powerful?

I mean, for me, operation, as I said, I think it's about how we use that technology to augment the capabilities of our people, taking away some of that low-value tasks so we can really use them to help our customers in the best way possible. And I think we have this follow-the-sun model right, not just on our technology platform, but we think when we use those people around our 8 offices to provide 24/7 service to customers. And having that one global platform is incredibly important for us to be able to scale the service in all of those countries globally. But I think where it really comes to life is for clients, right? It's -- we still take probably about 250,000 calls a year from customers. And it's really the people who deliver that service to customers some of the sort of situations that you heard. And so when there's an issue or a problem or something is not working, it's having our teams, our customer service teams talking to the clients, talking to our operational teams to sort of understand if there's an issue with our bank or another bank or working up what the problem is and being able to resolve that quickly for the customer. And that combination of the technology that helps us to kind of deliver the service with the people work on problems when things go wrong is, I think, is part of what OFX's value proposition is.

I think in the technology area, I'd say that probably a great asset for us is having access to global talent. We used to be fishing in a very small pound here in Sydney for all of our talent. Now that as a result of COVID lockdowns and the increasing demand for TikTok, we had to -- forced us to look elsewhere. But that's not only benefited the access of talent, but we also find the teams are more stable. We've had a higher retention rate since we've had this remote hybrid operating model. And that means that as we invest in our people, we get more long-term returns. Kate, I might turn it back to you -- turn the table to you. Do you want to tell us a little bit about how you think about our people strategy?

Yes. Probably best characterized as good old-fashioned TLC, talent, leadership and culture if I think about it. In terms of talent, it's how we attract, retain and grow great talent. OFX has a fair bit on its side in relation to that. Firstly, we're global. And so that offers a real point of difference and interest for people who are seeking diverse career experience. As Adam mentioned, we have a hybrid model of working and that's provided a lot of really valuable flexibility for our people, but it also means we've been able to contract talent in a diverse range of locations, and that's been really helpful to us. From a -- we're also really good at internal career mobility and actually went back and had a look last night, more than 10% of our people had a promotion or a role change over the last 12 months, and that's clear evidence of the fact that we look to promote and develop our people from within. And we also provide global mobility. So we've got a number of people with transition roles globally. Leadership. Here's a little bit of HR gold for you. Management is our third highest engagement factor for our people after work class blend and diversity and inclusion. And our senior management are rated 4.2 stars on Glassdoor. In terms of leadership, we've also invested in true teams of like development through our senior leaders, through our middle level management leaders and for emerging leaders. One of the biggest benefits of these programs is that they're global. So our leaders get the opportunity to interact with each other across the regions, and that has benefits for them being able to connect with their peers globally, but also it supports our global operating model. And culture, we don't think it just happens, but we think it's very much leadership led and it requires ongoing investment. And I really don't think you're ever done when it comes to culture. But we definitely think about our investment is paying off because the sort of data points in relation to that, our employee engagement has increased from a low of 59% in 2018 to 74% in 2022. Glassdoor ratings have increased from below 3 stars in January 2019 to 4.4 stars in January 2023. And our top 3 Glassdoor ratings are around culture and values, diversity and inclusion and work-life balance. And also our voluntary attrition is at its lowest point in 4 years, including COVID year. So it might be a really simple way to think about it. We definitely think sort of TLC is paying dividends for us. I will hand back to Skander now.

All right Patricia. Okay. So for our last discussion before any final questions and our wrap. Obviously, I'm delighted to introduce Patricia Cross to you. Some of you have already met Patricia, some of you know Patricia through her experiences outside OFX. But I thought it would be very, very helpful Patricia to share a little bit about her perspective since she joined OFX. But maybe let's kick it off with just help people understand a little bit about your background.

Okay. Okay. As I said to Skander, this definitely should be more about OFX than about me. But you have my bio that got quite an international background. Came to Australia though 30 years ago, very happily so. I'm a serial international banker and company director, served on 3 of the 6 major banks in Australia, NAB, Macquarie and Suncorp. And I also served on the Aviva Plc Board, which is the largest insurer in the U.K. Currently spending my time with OFX and the Future Fund [indiscernible] .

So with that sort of background, why join a little company like OFX?

It's a great company. It does have a fantastic group of people working here. I like the model, the way that we do work together. It always had a good reputation of its management team. The Board is strong and very much like strategy, as I've learned more and more about it. I was delighted by the risk management culture when it came into the organization because everyone knows about the perils of misbehaving in certain spaces in financial services and none of that evidence there. And in fact, OFX is well regarded by regulators and people that are playing on the broader scale in the international community in terms of how they handle things. So a lot of pluses to that. I love the fact that the platform is scalable, and I know you're hearing that ad nauseam, but it's just so important to be able to operate globally in a well understood way but to be able to scale up from the way that you started to work within certain processes, parameters and ways of doing things. So that's kind of it. I just thought, why don't I want to go to another big Board and do the same old thing? And I did start my career in over-the-counter derivatives. Well, now I started my career in foreign service, it's a long story, but I did eventually get into our risk account or derivatives. We actually were the team that invented these things. And we did it on the back of international capital markets arbitrage because we were enabling customers to fulfill a deep stated need to actually borrow in other countries and manage their financial risk. And it seems though not surprised that no one has ever done before then. This is the early '80s. But it started up in Scandinavia, actually and then came now to states. Of course, now the states say we were the first to do interest rate swaps. That actually -- it all started in Europe. And I just love being able to do things and create things that make a difference, and I'm passionate about the international economy. I do think that financial services banks very much, but especially companies like OFX have a big role to play.

And you've been through a few of these major events, let's say, in the last few decades, and you've joined OFX with those things in mind. Anything at this point that you would highlight as sort of meeting and exceeding expectations versus things you think we've got to work on particularly?

Well, definitely, like I said, what exceeded my expectations is the management team. Any company Board that someone joins no matter how much due diligence you do, you just don't know what you're getting into it until you're actually sitting there among people. So what a great delight it was. And as well, the Board has terrific experience, especially in enterprise change, in payments, sure in financial services, but having people to constantly questioning the way that we're going about doing things. So that's all been a delightful surprise. I already knew about the financial position of the company because, of course, that's the first thing that I look at, and sorry folks, I do love cash, a strong balance sheet. But also, I did see there is that potential, the acquisitive mindset is very strong at OFX. And so that was also -- I wasn't surprised, but I was very encouraged to see that even though they've just done Firma, they were developing the playbook and very disciplined about how they were [indiscernible] going on with it.

Good. And just building on that, what sorts of skills do you want the Board to have? What areas are you focused on as you think about the Board and how the Board can support investors -- represent investments?

So I think it's important to have a Board that is both experienced in terms of being on listed company Boards, that's really important in a small cap listed company. You need people that actually know how to deal with listed markets [indiscernible] steps, but really know how to prosper there, but also to have people with a little bit pressure point of view as well. It's important to have a very inclusive boardroom. So I like people that are naturally inclusive. You don't want to have all A types that have been running big companies and pontificating because I've definitely served on Boards like that. And that just doesn't bring out the best in the team. So I think it's great to have the financial services experience that we do and some of that deep consulting experience is so important too. And basically, everyone's got to very much understand their way around a balance sheet and how that interacts with what you can do with your customers. So I do have a long list of demands, don't I? And it's handy also if they've been involved in a bit of M&A.

Good segue. How does the Board think about M&A? What's your kind of message to investors about how you -- how you're encouraging management around that? Or what's your sense of M&A for OFX?

I think I said earlier, one of the things that attracted me and delighted me as I got into OFX is that notwithstanding that OFX had just done relatively big acquisition with Firma that they had a strong sense of purpose where they wanted to take the company in terms of future acquisitions. There is a lot of opportunity out there right now. We need to be judicious and make sure that we continue to do things that are accretive to the long-term development of the company. So the big message I'd give is that I had a very strong training, especially at Wesfarmers, but also at Macquarie and not jumping too quickly. And I also got the experience from others of sometimes if you drop too quickly, you're going to pay too much or do something that doesn't make sense. So just kind of combining all of that, but it's clear to me that this company has growth prospects inorganically as well as organically. But the thing that I personally like to look for, Skander, and I know you hear this all the time, is I do like logical incrementalism, I like adjacencies. That's something that Macquarie has been terrific at. And the other thing Macquarie is really good at they fast fail, hoping not to fail. But I think it does -- the Board and the management team have to know what you're going to be looking for both in the short term and the longer term.

Yes. Excellent. All right. And you talked upfront about -- the large pools that OFX may have access to. What about global? Tell me a little bit about your perspective. Obviously, as you said, you've served on the Aviva Board. You've obviously grown up doing business in the U.S. and Scandinavia and other places. How do you think we can be a better global company?

I'd say most of my work prior to Australia was actually in Europe, even though I don't sound like it. But we do have a global platform as we know, and we actually have the offices in each of these countries so that we can hand off the [indiscernible] around the world. I did the same thing at the NAB. From my very early days, I joined the NAB as the Treasurer, and then I was running their global and institutional bank. It's just really important to be able to pass your book around to people that you trust, that are going to manage both your position and your customers.

Another question we get a lot from investors is around ESG. Maybe give us your perspective on how the Board's thinking about that?

Well, I'm passionate about ESG and spend a lot of time in this area. So I think it all starts with governance. So I have to say, I think they got it backwards in calling it ESG because if you've got your governance right, then you really are going to be focused on having a sustainable company, and sustainable companies are ones that do behave well in the environment, who have a great social license and reasons for that social license and strong governance that underpins all of that. So in terms of governance, I think it's really important that you do have an agreed way of doing things that it's well articulated, both internally and externally. We, as a Board, have great respect for all of our regulators. We deal with many regulators and with policymakers. OFX is very well regarded, far preceding me with global regulators and policymakers and we are leaned on for advice about all sorts of things. We have a role to play in terms of data privacy, cybersecurity, AML, fraud, pricing, customer behavior, all that filling. And so we do take our governance role seriously. And we're not complacent about either. So yes, we are in a good position, but you can never be complacent because there's [indiscernible] organisms trying to disrupt what's happening in government in a bad way. In terms of environment, you all know that OFX itself has a fairly low carbon footprint. However, we really believe in trying to enable our customers to do what they can to have a dialogue, an ongoing dialogue and to be encouraging of any company irrespective of whether they're a high emitter or low emitter in making the transition and to do what they can to influence the transition. Also, we've chatted around the Board table. We can see that there -- it would be good to have more standardization around how carbon is reported and how to measure, and I've been speaking at forums with ASICS, especially saying, this has got to be done so that we can kind of all get on the same page. I'm generally pretty optimistic about that even though you can chart out a lot of figures that show that it's not going as quickly as it can, I think the intent is there. And then in terms of social, we mentioned our workforce before we have very high engagement that is still a great surprise at OFX. I've only been here since August 2022. It's no. But we believe that our people should be enabled and feel included in all of the decision-making in the company irrespective of what level they've got in the company or their role. We really try to encourage people to speak up and be included. Diversity is incredibly important in that respect. It helps us to form better performing teams. We're constantly looking at that. As you probably know, I founded the 30% club in Australia. That's because, again, I saw a need for something that wasn't there. And so we're constantly having our lens on diversity [indiscernible]. But the thing about inclusion and enabling our employees to speak up is we're also trying to enable our customers to be part of the system. And if you're not doing that at home, you can't do that with your customer cycle or [ do anything ].

Great. Last question for me before opening up the floor. Any other things you think investors ought to know about the way the Board is thinking about the company that I haven't covered? Any other final messages?

The Board is nice. It has a nice little point where it does really quiz management on certain things in a constructive fashion. And an example of that, I was telling one of our investors that some Board members were chugging on their coffee when they read about the Airwallex editorial following on SVB. And we were saying, "Now, we need to do more hustle, hustle, hustle." And management pushed back and said, "Look, we're not ambulance chasers, and really, it's more about encouraging the system to look after itself and participate as you can in that." But it is an example that the Board is very conscious of needing to be constructive yet challenging. And so there is definitely opportunity in the current environment for OFX. It's just a matter of how we go about doing that. But I do think, especially the next couple of months are going to see more of a shakeout. We talked about consolidation. And I think there's just going to be so much focus on equities especially in the smaller caps on shorter-duration stocks that are making profit, do have strong balance sheets. So all of that is just got to deliver opportunities for us. However, there are continued risks. It is an environment where business confidence has gone up and down a little more quickly than we might anticipate it because of what's happening in the States. And so we're never complacent about that. And we're hoping that we get the opportunity side of that but not be any negative side of the [indiscernible]. So it's pretty crazy in the States right now, and you want to watch the news this morning. When you look from the Trump news and look at what Powell has been saying, you can work yourself up if you want to.

Good. All right. We've got a little bit of time for questions. I'm looking at Matt. Any there any questions online? Or are we...

Yes, we've got questions online from [ Marco Correa ]. Firstly, on the share price and the pressure on that in the last 6 months. Do buybacks fit into the capital [ investment ]framework?

So I'll start, and I'll hand it to you. So any good Board always looks at all aspects of capital management, including buybacks. So we do continue to add to the capital structure of the company. But we have to balance that with the ongoing strategic needs of the company and what we may or may not be doing. Skander?

Nothing I could add to that.

And a question for Skander. On a quarterly basis, NOI has been down sequentially in the third quarter '23 and fourth quarter '23 by a few percentage points. Confirming the softness is isolated in high-value consumer, and this is again from [ Marco ].

Yes. So I mean, obviously, this is a trading and performance update. But yes, what we've seen in terms of the softness has been very largely, and we will break it down for you, obviously, when we do the full year results in high-value consumer. The corporate portfolio has been resilient, and we feel great about it. But certainly, high-value consumer off again, some pretty big highs, which, again, I think is not unusual. I keep talking about what cyclical versus unprecedented, how to look at high-value consumer over the last sort of 5 to 6 years. We've seen this play out before. And we know, again, if you look at prior periods that we see high-value consumers reactivate. And I think I shared some data points in the past about clients who were resolved as sort of 2005 inactives coming back. That's what actually tends to happen with OFX in the high-value consumer business. It's a very good business, just not on a straight line up like corporate is.

That's it for them.

Great. Any questions in the room? Yes?

Patricia, can I hear your and the Board's collective thoughts effectively on how, in the medium term, things like blockchain and stablecoins are weighing on some decisions or considerations in the future of the company?

Sure. Big -- I'm a big fan of blockchain. The Board is a big fan of blockchain. The way that, that could be used, especially in an integrated comprehensive [ pledger ] is very handy indeed. We've done -- we've had a lot of discussion around crypto. Not going there at this point. I might ask Skander to comment on it.

Yes. So just to build on that, we've said in the past that, let's start with what the client is looking for and the problems that we can solve. And to Tricia's point, blockchain looks like the most promising from a technical perspective to help drive speed, security, [ usability ]. [indiscernible] Crypto appears to be more of an asset class than a currency certainly at this stage. We've also said in the past to investors that our take is, if you go back to the first point is that the great catalyst for us at least, will be central bank digital currencies because our target segments, as you heard up here are not speculators. They're not people who are looking. In fact, the whole presentation, they're trying to reduce risk, not take more risk. So -- but the central bank digital currency could be an alternative for them around how do you move money quicker, more securely, those sorts of things. So the working group internally and our technology teams and our product team, that's really where we're focused.

Are you just able to expand on that in the sense that the blockchain for all its sort of advertisement or has speed, security, et cetera. Surely, that would mean that the margin, you might see a lower fee on that line of business than perhaps what it was today, 5 years ago, et cetera? Or are there other?

There's 2 areas, [ Cam ]. One is what blockchain could potentially do is drive faster settlements. And to your point and what Mark talked about today, clients are seeing 80% of transactions in less than 1 day. You heard clients saying sometimes, "It's more than one today. We don't like that." If it gets to instant, and we think it will get to instant, then potentially, that's blockchain-enabled. We could do instant, by the way, today. But we choose not to because we'd be taking on some credit risk to do it. If blockchain allowed us to not -- to do instant without taking any credit risk, then we'd look at that. But the second thing, which I think is a very, very important factor and it's I think it's underappreciated, is actually privacy and security. A lot of the data that we use and that you're seeing cyber attacks around is because it's in silos. Blockchain allows you to distribute the data, which makes it a lot more secure and a lot easier potentially to protect. So that is a trend that has yet to play out. But one of the reasons why cyber attackers target banks and finance companies is there's lots of data sitting there that they can go access. In a blockchain setting. They can't get to it quite as easily because it's distributed.

A couple of questions. First of all, I notice in your CV where you're a little bit innovator in terms of the over-the-counter derivatives, so I'm interested in terms of your thoughts where see innovation with OFX ongoing from the core product. And secondly, I'm just interested in terms of how why do you view casting the net in terms of acquisition opportunities. Is it really more Firma-style acquisitions? Or are you thinking a bit broader in terms of adjacencies?

Okay. Well, if I start with opportunities at OFX. OFX has been principally one line focused on payments. While it came along, OFX has done a little bit there, but not -- it's not been the signature product's offering. The future of OFX will be around that whole value chain, if you think about the customer needing to make a payment. Start at the beginning about the reason to make the payment when the purchase is something or an invoice for a product or -- and then taking that through to the end game. So I think there are various points along that chain that OFX could investigate getting into. We do look at a wide gamut of products and services. We discussed them. I was telling about cards earlier for example. We've deliberately decided not to do certain things because they've either not met where we're at currently in our customer offering. We literally decided that we didn't want to go there. So I think that there is a strong opportunity though, when you do think again about the customer enablement and what the customer needs. And TreasurUp, for example, although we don't have it implemented in Australia yet, that is going to [ assist ] companies and looking at more the risk management piece. So if you just think about the customers that we have here today, they're invoicing their own customers. There's a piece around that. There's definitely a huge piece around the whole risk management and foreign exchange exposures. And that was where we took the NAV, for example, when I was running the wholesale institutional bank. The reason why I was promoted from treasurer to running this bank within the bank was because we said, "Oh, let's help our customers manage financial risk. It's pretty logical," imagining the pushback we had at the time. But that's what we seek to do at OFX. But do you want to add to that on the acquisition side?

No. It's good.

Sorry. And the second part of the question was...

Well, it was innovation [indiscernible].

Yes, I think you're pretty much covered. Maybe just talk about as a Board, just looking at the framework in terms of risk [indiscernible], what's the [ chase ] offer in terms of acquisitions?

So we don't want to do an acquisition that's really dilutive actually in any way really. But we are looking for companies that have a special sauce doing something in that customer value chain that we really like. We are very cognizant of linking any deal we do with future reward of the deal in terms of how [ our ] buy-out might be rewarded. So we're always [indiscernible]. We are agnostic about exactly -- I shouldn't say we're completely agnostic about markets, but because we do have a global footprint and we're looking to do more in our global areas, we're looking globally, very cognizant that Australian companies have got themselves in a lot of trouble, I'm sure -- so we're pretty careful about it. And so the Board is just, at every Board meeting and in between Board meetings, looking at various things, a lot of underwater activity. Do you want to add to that?

No. [ Maddy ], yes?

We've got some online follow-ups from [ the last ]. So [indiscernible] questions overall. But firstly, Bede from Teed Up mentioned a travel card would be very handy. Is this something on the OFX road map? If not, why?

Yes. I mean I think Elaine put it up on her chart around what we don't have, and corporate card is definitely the sort of thing that we know, and honestly, Bede wasn't, excuse the pun, teed up to say that. But genuinely, that's the sort of thing that we hear from time to time. We've also seen candidly, competitors do a better job than us at putting that product out in the market. Clients want it, so that is definitely on the road map. Not so much to be honest for consumers. We used to have a travel card, and it's good to see [ Gary ] here is one of our cofounders. The thing about the travel card for consumers is it sort of takes you down from the high-value consumer segment that we're really focused on. It's certainly convenient, but as Tricia and the Board constantly remind me: capital is limited, and it costs money. So if we're going to do that, what are we not going to do. So we're much more focused on corporate.

And the other thing about corporate is that there is more -- there are more bits in that value chain. So the corporate credit card is another way of getting that [ attention ].

Okay. There's a few more. See how many we can fit in with time. A question for Adam. Some of the things that you're impressed with that your competitors have but [ lacks ] at on the road map?

Sure. As you could tell from my answers before, we're pretty much working on every part of the whole customer experience. I guess when I look at our competitors, I think we're trying to improve our speed, and we're doing that currency corridor by currency corridor. You've heard that we're about to work on our corporate onboarding experience, and we spend a lot of time focusing on consumer in the past. To onboard a corporate, you have to onboard the directors and the individuals of the company, so you really have to get the consumer right first before you commit to corporate. So I think you're going to see a lot of progress there. And then I share the same sentiment as other conversations. There's definitely a lot more opportunity outside of just the core transaction. And so we're just trying to get ourselves set up so that we can move into those spaces. Do you want to say anything?

No. I mean I think I've talked about it. I think [ competitors ] have done a great job on speed, great job on simplicity that we could certainly adopt and are adopting.

I think Elaine wanted to add to.

Yes, I would say it's like a seesaw, right? You're constantly moving up and down on these different things that clients value. I think it's what's really important on this is to come back to what corporate's value actually, and it's really around the digital leads [ abuse ] specialism, savings. You've heard the panel is always talking, I will check you on price to make sure you're competitive. And then you have ancillary things like cards is definitely in the consideration that we know would be really useful, and as the clients have said equally, you've also seen from Selina's presentation that we're really focusing on that corporate platform before we add sort of additional products and services onto that. So I do think coming back and going what helps you win in corporate, particularly as well as the high-value consumer is where we should be putting our money on the market.

A question for Selena. Is the net cash generated flat on [ 2016 ] net tax? Is there a disconnect with where the underlying EBITDA is tracking? Looking forward, how should we think about operating cash flow versus underlying EBITDA? Should be largely a match?

So that side does include payments, okay? There can be some ins and outs on the tax payments because you make your installments through the year but also because of our investment in intangible investments, we get quite good R&D. Tax credit comes back, and that comes back once a year, which is not obviously a net cash flow for that period. You will see over time, you can go back, we have a pretty good conversion rate from EBITDA to operating cash flow. And you can see that always in the half year and full year results [indiscernible] right there. If you just look at the moment in the first half, when you looked at our conversion rate, it was lower, but it was lower because of 2 things: one, which was the transaction fees on [indiscernible], so there were some transaction fees on [indiscernible]. But if you look at underlying cash conversion, it was more than fine. And also we had to post some cash for collateral because it was so volatile in that first half.

Okay. Thank you. Are there any costs either available to pull if the revenue outlook is more challenging?

You want me to take that? It's fine to go, Selena.

Yes. So we're always looking at that, and it reminds us of back when COVID hit. So when COVID hit in March '20, we had a great revenue and enough that it was quite soft as a business, but we always look at are what are the levers [indiscernible] need to shift and move if the revenue is not there, and we usually stage-gate it, Stage 1, Stage 2 and Stage 3, the revenue is not there. And obviously, the revenue is not there, the demand is not there. Therefore, you're not going to spend as much on marketing. If the revenue is not there, you're not going to pay as much as commissions and bank fees. So you have some natural variable costs in the business that might be there, if the revenue is not there. And then we go through the other stage-gates or [indiscernible], meaning those are high increases, all that sort of stuff, we can put those into play if we need to.

Which we haven't had to do.

Thank you. And just a final one. A question for Patricia. There was some talk of what Macquarie does well. And one thing is its allocation of capital to the most efficient means. With OFX, given the recent share price weakness [indiscernible] accretion of [indiscernible] initiating a buyback starts to look far more attractive versus further acquisitions. How dynamic is the Board thinking about a buyback versus further acquisition?

The Board is continually looking at all options.

Right. I think that's everything online. Let me just check. Sorry, there's one more question from [ Marco Correa ] again. Given the volatility and lower business confidence mentioned earlier today, has the corporate book held up better than internal expectations over the last 6 months? How should we think about the -- I can't say that, [ cyclicality ] of the corporate book and its correlation to macro factors such as GDP, capital investment and business confidence?

So I think, [ Marco ], we've talked quite a few times this morning about how corporate performs through the cycle. And you can see that, especially if you add the comment that I made about the consumer being pretty soft especially in the second half, especially in the fourth quarter. Those results really consumers are not doing well, then just the NOI number to what [indiscernible]. And another data point, which [ we have a look ] again and produce a good result like that, your corporate if it creates, there's such a headwind around macro factors. So we feel pretty good about corporate, and I probably want to just triple emphasize this point that some of these signs that you're seeing now into late February and March around corporate confidence, like I said, China reset, we've certainly passed halfway on interest rate rises, inflation rates are slowing. You kind of heard from our clients how they're getting more optimistic about particularly use cases. And as a result of all that, if corporate is a through-the-cycle segment, no question.

That's everything online.

Terrific. Well, look, thank you so much for those who are here physically. It's great to see you in person. Thank you very much for those participating online for all the questions. Thank you very much to my global executive team and to Tricia for sharing the OFX story. We'll obviously [indiscernible] again in May when we announce our results. But thanks for your time and also big thanks to the team at Citadel-MAGNUS and [indiscernible] and KPMG for staging the event. We appreciate it. Thank you.