PointsBet Holdings Limited (PBH) Earnings Call Transcript & Summary

Hello, everybody. I'm Drew Brees, former NFL quarterback from New Orleans Saints and current NFL commentator for NBC Sports. As PointsBet's global ambassador and a PointsBet shareholder, I would like to welcome you to the 2021 Annual General Meeting. This has been a significant year for the company, and we are looking forward to the future as we build the PointsBet brand and expand further into the United States and beyond. I will now introduce Chairman, Brett Paton, to officially start the meeting.

Thank you, Drew. We're looking forward to seeing the new brand campaign. Welcome to the PointsBet Holdings Limited 2021 Annual General Meeting. My name is Brett Paton, and I'm your Chair. We have a quorum, and I'm pleased to declare the meeting open. Today's meeting is being held online by the Lumi platform. This allows shareholders, proxies and guests to attend the meeting virtually. All attendees can watch the live webcast of the meeting. In addition, shareholders and proxies have the ability to ask questions and submit those. Online attendees can be -- online attendees' questions can be submitted anytime. [Operator Instructions] Please note that while you can submit questions from now, I will not address them until the relevant time of the meeting. Please also note that your questions may be moderated or, if we receive multiple questions on one topic, then we'll [indiscernible] together for convenience. For those shareholders who wish to ask a verbal question, an audio questions facility is available during this meeting. [Operator Instructions] You will listen to the meeting on this page while waiting to ask your question. If you have any issues using the system, please return to the Lumi platform. Finally, due to time constraints, we may not get to answer all of your questions although this is the intention. Voting today will be conducted by way of poll on all items of business. In order to provide you with enough time to vote, I'll shortly open voting for all resolutions. At that time, you're eligible to vote at this meeting, a new voting tab will appear. Selecting this tab will [indiscernible] list of resolutions and present you with voting options. To cast your vote, simply select one of the options. There is no need to hit a submit or enter button as the vote will automatically be recorded. You do, however, have the option or ability to change your vote up until the time I declare voting is closed. The notice of meeting was distributed to all shareholders, and copies are also available from the ASX announcement. I take the notice of meeting as read. I now declare voting open on all items of business. The voting tab will soon appear. Please submit your votes at any time. I'll give you a warning before I move to close the voting. I would like to start by introducing my fellow directors: Sam Swanell, Group CEO and Managing Director; Peter McCluskey, Chair of the Audit, Risk and Compliance Committee and a member of the Remuneration and Nominations Committee; Tony Symons, Chair of the Remuneration and Nominations Committee and a member of the Audit, Risk and Compliance Committee; Becky Harris, member of the Audit, Risk and Compliance Committee and the Remuneration and Nominations Committee; Kosha Gada, member of the Remuneration and Nominations Committee; Manjit Gombra-Singh, President, Technology and Product and Executive Director. Also in attendance today is our Chief Financial Officer, Andy Mellor; and Group General Counsel and Company Secretary, Andrew Hensher. We also welcome Billy Chan and his colleagues from RSM, the company's auditors. A lot has happened since I addressed you last year, and it's pleasing to reflect on some of the key milestones achieved by the company in the past 12 months. We entered into a transformational 5-year media partnership with NBCUniversal, providing PointsBet with deep access and integration into NBCUniversal's world-leading broadcast and digital assets. We successfully completed 2 strategic acquisitions, being Banach Technology and [indiscernible] and the Premier Turf Club, both accelerating the development of our unique in-house technology platform and product offering. We've established a strong pipeline of growth into FY '22 and beyond and with the expectation of launching 11 new United States' states as well as Ontario, Canada by the end of calendar year 2022. We attracted outstanding brand investors, including Paige Spiranac, Drew Brees, Shaquille O'Neal and Devin Hester. We were appointed as one of only 7 official sports betting partners to the NFL, making PointsBet an authorized partner of the 4 major U.S. pro sports leagues. We've also entered into strategic partnerships with the host of NBA, MLB, NFL and NHL teams across the U.S. Under these deals, which link closely to the markets where PointsBet is operational or soon will be, we gained usage of the team's trademarks and logos as well as sponsorship opportunities, brand visibility across various assets and databases. And we have assembled a highly experienced iGaming team and successfully launched iGaming in 2 states, Michigan and New Jersey. I'd now like to make a few comments on the global commitment to respond to gambling. PointsBet endorses the principle of informed choice, which is aimed at empowering customers to make informed decisions and exercise choice regarding their gambling expenditure. PointsBet's commitment to responsible gambling is demonstrated through its wide range of responsible gambling initiatives and tools, some of which go beyond those obligations imposed by regulators in the jurisdictions in which we operate. Both Australia and the United States have a dedicated responsible gambling officer and supporting teams. We've also invested in improving -- improvements in our systems and automations to detect red flag behaviors, which have allowed more fact-based and individualized approach to responsible gambling with our global customers. These system investments have also led to improvements in fraud, anti-money laundering risk detection, which facilitate compliance with our regulatory obligations and also reduce revenue leakage. PointsBet has a policy that all customer-facing employees receive annual responsible gambling training. In the United States, we have also leveraged our brand investors to create campaigns focused on responsible gambling education. In U.S. where the sports betting regulatory framework is evolving, PointsBet is actively engaging with the regulators and other relevant stakeholders to support the implementation of evidence-based and global best practice regulations to future proof the sustainability and integrity of the whole industry. Ultimately, we believe this is an important area for long-term sustainability of the industry and take our obligations in this area very seriously. On corporate governance, the Board of PointsBet Holdings considers good corporate governance a priority. It has adopted policies and practices to ensure the Board remains effective and has the composition to adequately discharge responsibilities and duties and maintain best practice governance. A review of these documents was undertaken during the year to ensure we stay compliant with the ever-changing governance framework. A full summary of our corporate governance activities and policies are available on our website. Our Group CEO, Sam Swanell, supported the U.S. -- supported by U.S. CEO, Johnny Aitken, have done the tremendous job in leading the business through a period of substantial change and growth over the past 12 months. In addition, our highly talented employees across our global footprint are a key asset, and the results we've been able to achieve, thus far, are a testament to their dedication, commitment and passion. On behalf of the Board, I would like to thank all the teams for delivering on the opportunities we saw over FY '21 and positioning the business for continued growth in FY '22 and beyond. I would also like to thank my fellow directors for their support over a very busy past 12 months and as well executed on our strategy and undertook a significant capital raise to ensure the company is well positioned to execute on the opportunity here and overseas. I'd like to thank you, our shareholders, for your support and vote of confidence in the business and its team. We look forward to delivering on the opportunities we see for the business going forward and growing shareholder value. In concluding, it is now my pleasure to invite Sam Swanell, Group CEO and Managing Director, to provide further commentary on the FY '21 financial year and the business strategy and priorities over the coming period.

Thank you, Brett. Good morning. This is Sam Swanell, Group CEO and Managing Director. I would like to thank you all for attending this virtual 2021 Annual General Meeting of PointsBet Holdings Limited. Since inception, PointsBet's Board and management have been working towards establishing the key building blocks that have put us in a strong position we are in today to pursue the expansion of the North American sports betting and iGaming opportunity. These key building blocks include: continuing to build our in-house technology platform; establishing significant market access to U.S. states; executing a transformational transaction with NBCUniversal; partnering with key U.S. leagues, teams and brand ambassadors; Establishing a profitable and growing Australian business; and building a market-leading execution team. On the 26th of August, PointsBet completed a $400 million capital raise. Under the offer, PointsBet raised $215 million at $10 per share under replacement, and $185 million at $8 per share under a 1 for 9 pro rata accelerated renounceable entitlement offer with retail rights trading. As a result, at 30 June 2021, the company's pro forma corporate cash balance was $634.5 million. We continue to build the business for long-term success, and most of the pieces are now in place as we look towards FY '22 and beyond. The 2021 financial year represented another transformative period for PointsBet. It was a period of continued focus on establishing a platform for future growth and execution. This was characterized by: continued investment in additional U.S. state market access; our scalable cloud-based technology platform and product, including iGaming; our people; And executing our marketing strategy to efficiently acquire clients in Australia and the United States. I will now summarize our full year financial results, noting that further details can be found in our 2021 Annual Report released on 31 August. All figures are in Australian dollars unless otherwise stated. The group handled $3.78 billion in turnover, an increase of 228% on the prior year. Sports betting gross win was up 201% at $353.1 million, and total net win was up 154% at $208.5 million. Revenue for the reporting period, PointsBet reported net revenue of $194.7 million, a growth of 159% versus the PCP. Gross profit of $87.6 million represented growth of 129% over the PCP. The group sales and marketing expense was $170.7 million for the year, and the U.S. accounted for $119.2 million. This increased marketing investment assisted in the delivery of 196,000 cash active clients in Australia and 159,000 cash active clients in the U.S. as at 30 June 2021. The group's normalized EBITDA loss was $156.1 million as the company continued to invest in the business to build scale in North America and within the technology department as well as growing our U.S. client base across our 6 operational U.S. states. The Australian trading business recorded a net win of $166.1 million, up 121% from the prior year with a net win margin of 8.4%. The Australian trading business saw improvements across a number of key KPIs, particularly with respect to customers continuing to trend towards higher margin multiproducts. Improvements in the marketing tech tools and the refreshed brand campaign featuring Shaquille O'Neal also assisted with acquisition and retention compared to the prior year. Turnover in Australia was just shy of $2 billion, up 140% compared to the prior year. We were also very pleased that the outstanding Australian trading business growth was achieved while recording a statutory EBITDA of $9.2 million, an increase from $6.9 million the prior year. During FY '21, the U.S. business operated in 6 U.S. states, namely, New Jersey, Illinois, Colorado, Michigan, Indiana and Iowa. And in August, we added our seventh state with $95.8 million at a gross win margin of 5.3% compared to gross win of $16.5 million in the prior year with a sports betting net win of $40.9 million at a net win margin of 2.3% compared to a net win of $7 million for the prior year. In addition, the U.S. business achieved high gaming net win of $1.5 million. This delivered an overall U.S. net win of $42.3 million for the year. There is no doubt that a key driver of our success to date has been the strength and depth of talent we have acquired across all areas of the company. We will continue to add bench strength as we expand. Key recent hires include: Mark Hughes, Group Chief Operating Officer, formerly CEO of Banach Technologies and, prior to that, of Paddy Power, Flutter, owner of Sportsbet and FanDuel; Scott Vanderwel, CEO, PointsBet Canada, formerly Vice President of one of Canada's largest media companies, Rogers Communications; Nic Sulsky, Chief Commercial Officer of PointsBet Canada, formerly President; Aaron O'Sullivan, Vice President of Online Casino revenue, formerly Head of Games at Bet365; and Aounghus Mulvihill, Vice President of Global Sportsbook Trading, formerly Commercial Director at Betfair International, another Flutter company, just to name a handful. Today, as mentioned, we have operations in 7 U.S. states with iGaming in 2 of these states. By December 2022, we plan to be live in 18 U.S. states and the province of Ontario, Canada. West Virginia and Pennsylvania will include iGaming, and others such as Ontario will add to the iGaming addressable -- total addressable market in the short term. Our execution strategy continues to be clearer. We will continue to invest to remain a top 5 operator in the long term, targeting 10% market share in each of the states we offer sports betting within 3 years of launch. As we have said since we first launched in the U.S., it is clear that product will ultimately win. We currently have a terrific product as can be seen by success to date. However, we will not stop investing in technology and product as evidenced by the recent acquisition of Banach Technologies and the ongoing investment in tech and product talent. We intend to be the market leader in U.S. in-play sports betting over time. We were thrilled to again be awarded the EGR sports betting operator of the year in the U.S. in 2021. Notwithstanding this, we see clear opportunities for innovation ahead for both our sports betting and iGaming products. We will continue to execute strategic and disciplined marketing campaigns, leveraging our media partner, NBC Sports, as the cornerstone with further innovative integrations across the NBC Sports media portfolio to accelerate client and brand growth across North America. I would like to provide some comments on iGaming, which is a key part of our U.S. strategy. iGaming revenues in the United States market have grown exceptionally since the repeal of PASPA in May 2018. Across New Jersey, Pennsylvania, Michigan and West Virginia, iGaming revenues reached nearly USD 900 million in the June '21 quarter, which, if annualized, would equate to greater than $3.5 billion per annum. The size of the opportunity is evident. As I've previously said, owning and controlling our in-house iGaming technology stack will become an increasingly important, strategic advantage. PointsBet has assembled a highly experienced iGaming team with deep experience developed at Aristocrat, Ainsworth and Bet365, just to name a few. On the 5th of May, PointsBet launched iGaming operations in Michigan. We now have 30 slot video poker and table games. We were pleased to record net win in Michigan to 30 June of $1.5 million. This Michigan launch was followed by the launch of iGaming operations in New Jersey on 23 July 2021. The company will bolster its iGaming offering in FY '22 with the addition of strategically selected slot games, live dealer table games and other innovative initiatives. As mentioned earlier, pending regulatory approval, PointsBet will roll out iGaming operations in West Virginia, Pennsylvania and Ontario in FY '22. PointsBet has also secured iGaming access in Ohio, Indiana, Missouri, Louisiana and Iowa, pending the passing of enabling legislation. I would now like to provide some commentary of the emerging Canadian opportunity. On the 22nd of June, the Canadian Senate passed Bill C-218, legalizing single event sports betting. Previously, only parlay sports betting was allowed in Canada. Regulatory details will be worked through at the provincial level with Ontario, population of 15 million people, anticipated to go live in late 2021 with an open-licensing system, followed by Alberta with a population of 4.4 million people in 2022. Goldman Sachs states the combined online sports betting and iGaming opportunity for Canada represents a USD 3 billion per annum opportunity. In anticipation of this significant opportunity, as noted earlier, PointsBet has already made some key management hires in Canada and is building out a high-quality team in the region. Like all markets PointsBet enters, we are committed to creating products that fit the Canadian consumer's needs, satisfies the important requirements of the regulators and enables fans to engage with their favorite sports in new and exciting ways. Last week, we were excited to announce that PointsBet Canada has entered into a multi-year deal to serve as the official and exclusive sports betting partner of DailyFaceoff.com and The Nation Network. DailyFaceoff is a world-class source professional insights, opinion pieces, breaking news and statistical analysis with 1.5 million monthly users, while Nation Network is a 12 website and podcast network of 5 million passionate sports fans. Both assets will help PointsBet establish a genuine connection with our target market in Canada. Now some comments on our NBC partnership. With the commencement of the '21/'22 NFL season and sports betting advertising being allowed around NFL for the first time, PointsBet, as one of only seven official sports betting partners of the NFL, is now working with NBC to capitalize on this new opportunity. In addition to former NFL quarterback and NBC team member, Drew Brees becoming a PointsBet global brand ambassador, the PointsBet-NBC sports partnership continues to break new ground. As well as regional sports network integrations, PointsBet was integrated into coverage in or around NHL playoffs, NBA playoffs, U.S. Open Golf and the Indy 500. This allowed PointsBet to reach sports fans during peak events, helping it further grow its brand awareness. PointsBet on-air talent, Teddy Greenstein and Jay Croucher, continue to be integrated further into NBC content. PointsBet also had more than 100 million impressions across NBC's digital platforms including Predictor, nbcsports.com, NBC Sports Edge and Spot On across key live states. The NBC Predictor app has now delivered over 350,000 leads for PointsBet. As we prepare to enter new states like Maryland, Pennsylvania and others, this provides us with improved brand awareness, together with a database of potential clients to engage with. In conclusion, the pieces are now in place as we look toward FY '22 and beyond. In Australia, investment made in marketing in H2 FY '21, off the back of the refreshed brand campaign featuring Shaquille O'Neal, has continued into FY '22 and has PointsBet positioned for its biggest and most successful spring ever. In the U.S., we're excited by the position we have put ourselves in as we continue to roll out new state launches as an official sports betting partner of the 4 key major U.S. sports, supported by the strategic NBC partnership. And finally, we are looking forward to preparing for the Canadian opportunity under the leadership of Scott Vanderwel as we target a launch in Ontario. I will now hand back to the Chairman for the formal business of the meeting.

Thank you Sam. I will now move to the formal business of the meeting. Firstly, on casting your vote, I advised at the beginning of the meeting that we will vote on the resolutions by way of a poll. Voting is already open and will remain open during discussions on the various resolutions. I will also provide you with notice that the polls are about to close. Results will be released on the ASX after the conclusion of the meeting. Please note that only shareholders, proxy holders or authorized shareholder representatives may vote. Any undirected proxy votes given to the Chairman will be voted in favor of the relevant resolutions. Any directed proxies given to you by the shareholder will automatically be cast as directed when the poll is closed. I appoint Peter Renda of Computershare Investor Services as our returning officer. We will now move to consider the first item of business, financial statements. The first item of business listed in the notice of meeting is to receive and consider the financial statements for the 12 months ended 30 June 2021 and the reports of the directors and auditor. Please note that no vote is required on this particular item of business. As mentioned previously, Mr. Chan, a partner of RSM, is with us today. Questions relevant to the conduct of the audit, the preparation and content of the independent audit report, the accounting policies adopted by the company in relation to the preparation of the accounts and their independence in relation to the conduct of the audit may be directed to him through me as Chairman. Any questions in relation to director and executive remuneration policies will be considered when we come to the part of the business regarding the adoption of the remuneration report. At this point, I'd like to pause to see if there are any questions.

We have a couple of questions from the Australian Shareholders Association. "With regard to resolution 1, given the social impacts of the gaming industry, the ASA recommends that PointsBet prepare a detailed ESG report, which, amongst other matters, outlines the mitigation of these." Thanks for that, and it's been useful [ prior to ] get together a couple of months ago on some of these issues with the ASA. As to this particular matter, the corporate social responsibility and sustainability report will be published prior to the 2022 AGM. So thank you for that. There's another question, a general question. "Would the Chairman comment on why there are 2 executive directors on the Board, whose principal job is to provide overview direction to the executive?" Firstly, on that, we have 2 Executive Board members. One is our Chief Executive Officer, which is standing in practice throughout -- companies throughout the world. So I'd like to focus on reference to Manjit, who was our second and most recent Executive Director appointed to the Board. Manjit, being responsible for tech and product development has oversight, currently over 204 staff around the world, that's currently in 2021. It's projected in 2022, we'll have an oversight of 419 staff. And we are, by definition, by the very number, have -- currently 700 close staff. We are, by definition, very much a technology company. But the time Manjit was voted on to the Board and shareholders approved his nomination, he was our first serious tech director, highly skilled in technology. Since then, we'll hear more from Kosha who will -- we'll -- we've got -- we've increased the technology capability at Board level. And that's -- I think that's a good pairing. So hopefully, that responds to that particular question. Should I pause there if there's any response for those answers? Thank you. I've got a question here from [ Steve Maine ], "How important was racing -- how important was racing never been shut down in achieving FY '21 results? And how do we crack the top 5 -- and how have we cracked the top 5 yet for market share in Australian sports gathering as yet?" So right, Steve, I might ask Sam to respond to that.

Yes. Certainly, Brett. Hopefully, everyone can hear me. Yes, I mean, obviously, it was [indiscernible] quite thankful that the environment where there were very few entertainment products available with most of the East Coast being locked down that one of the bright shining lights was that our great products and others, I mean our sector, were available to entertain people through these lockdowns. So there's no doubt that -- the fact that people weren't necessarily spending their discretionary entertainment dollar and going to the movies or going out for breakfast, and they could participate and have a bet on a Saturday or have a bet on the football. So I think it's clear that there has been a benefit there to betting companies such as PointsBet. The fact that land-based TABs have long been -- have been closed through this period provided some tailwinds. It's our belief that the amount of time that we spent locked down with physical TABs closed has been a long-enough time to change the habits of punters and those that perhaps were not embracing the online opportunity have now embraced it during this period. And so our aim is to hold on rather than to see them go back to [ land-based ] operators. So yes, it's obviously -- it's been a strong period of trading for us. It will be interesting to see the comps as we trade out of these sorts of periods. But PointsBet had a lot of momentum. Even prior to any sort of COVID impacts, PointsBet was growing extremely rapidly. You can see that from our results even late into 2019 where we delivered our first profitable month and delivered an EBITDA positive year there. So we have a lot of positive momentum. There has been some assistance through the dynamic that I just explained, but I'd also say that the improvement in our product, the improvement in our execution has really come on leaps and bounds in the last 18 months.

Sam, I'll put you on notice. Thanks for that. The next question from [ Steven Maine ]. I'll be asking you to comment on that as well. So the question is, "Shaquille O'Neal is the Australian ambassador. Have you thought about signing more Australian celebrities and striking partnerships with local supporting clubs? Why are the operating models between U.S. and Australia different?"

So the first part, Shaquille O'Neal -- we do a lot of research on these matters. And it might be a surprise to some at this meeting, but Shaquille O'Neal is -- we did voice of the customer surveys to our target market and our existing clients to sort of get a feel for who might be an appropriate brand ambassador to pursue for PointsBet Australia and their marketing campaign. And it was very clear that Shaq crosses a lot of demographics from 21 year olds all the way through to 40-, 50-, 60-year-olds. So the research came back extremely strong that if we could reach sensible terms with Shaq that it would be a great outcome. And I think it's worth mentioning, in the U.S., Shaq represents maybe 5 or 6 brands at once. He's huge over there and has represented many more brands over his journey since retirement. So for PointsBet to really to have a monopoly on the Shaq profile in the Australian market, not have him representing any other brands and have him representing PointsBet was a great [ crew ] to be honest. And the research that we've done post that campaign has only reinforced that it was a very astute move. Most -- hopefully, most shareholders appreciate the quality of the campaigns and the human that's involved there and how we brought the PointsBet experience to life perhaps compared to some of the advertising campaigns that are out there from our competitors. Brett, what was the second part of the question? If you can just repeat that.

Local -- perhaps local ambassadors engaging local talent.

Yes. I mean...

And sporting clubs or sporting venues, yes.

Yes, yes, yes. Look, the reality is that NBA basketball is the biggest betting sport in Australia. It became the biggest betting sport in the Australian market around 2015, 2016. So while, let's call it, maybe people of my generation think automatically of Aussie rules and Rugby League as the key sports, the reality is, is that NBA quite overtook the local sports in terms of popularity. So if you think about leaning into the strength when you have someone of the caliber of Shaq that you can get hold of and you know the appeal in the Australian market, that's the logic behind that. In terms of local clubs and teams, there is a reality around advertising restriction and just what we can and cannot do within certain situations. So we have a very diverse marketing mix. We have a pretty traditional marketing mix across TV, radio, press. Hopefully, shareholders are aware that we are the sponsors of the Cronulla Sharks, And most recently, we were announced as the sponsors for next year for the Manly Sea. So we are sponsoring a couple of the local [indiscernible] teams. There's some strategy around that and behind that. And again, as with everything, we're doing this in a disciplined fashion. So I think -- and we went from spending $20 million on marketing last financial year to just over $50 million on marketing this financial year. That was a substantial step up. Obviously, 250% in terms of marketing. So as I mentioned in my script that we're particularly pleased to step up that level in marketing and still do it without drawing on the capital of the business by actually increasing EBITDA. So really, our mantra, and as we've [indiscernible] as we've spoken about to the market is we want to continue to aggressively grow the Australian business. We see an opportunity to do so. We're going to do it within the bounds of not drawing on the capital of the business. So we want to stay EBITDA positive as we continue to grow. The Australian wager market and particularly the line opportunity, we see great, great opportunity in transferring one offline wagering from the TABs, et cetera, to the online, but also digging into other forms of gambling that have currently dominated in Australia. We'd like to see some [ transferees ] from the poker machine market to casino market. We think we've got the best product when it comes to having a bet, and we'd like to see that transfer. So we see lots of opportunity to continue to grow, to win market share of our competitors and to see the wagering market grow, in particular, see some transfers from those other forms of gambling. So while we can spend marketing dollars in a disciplined way that has a positive ROI, while not drawing on the capital of the business, we will continue to grow market. Now it's not going to grow by another 250% this year because, as I just said, it's about getting hold of the right assets that produce a positive ROI, and so we'll continue to do that in a disciplined fashion.

Hopefully, that covered most of those issues, [ Steve ]. There's questions, Sam, I'm going to put this -- I'm going to put Andrew Hensher on notice of this question, I'll read it. "If gambling reform were ever to get successful and campaign to have gambling advertising in Australia mirror the situation with alcohol, which can only be at a time during the last [indiscernible] about 3:00 p.m. or 8:30 p.m., would this be a major problem for PointsBet?" And the follow-on is, "Why have you advertised heavily during children's viewing hours?"

I can probably take that, Andrew, and you can sweep up anything that I miss. Look, we already have some pretty strong gambling restrictions here in Australia. Obviously, one of the benefits of being a licensed, legal, compliant operator is that you get to advertise. And there's a lot of offshore illegal operators that are happy to take clients from Australia and other jurisdictions, and how we distinguish ourselves from offshore illegal operators and why we pay our taxes and our fees that we pay is for the [indiscernible] and, obviously demonstrate an awareness to the market. There's already no gambling advertising between 6:00 a.m. to 8:30 a.m., 4:00 p.m. and 7:00 p.m. There's no gambling advertising or promotion of odds during [indiscernible]. So you'll notice that once the game starts, you might see us advertise before the game starts, for example, on the 6:00 news, et cetera. But you won't see it once the game starts. There's no promotion of odds during like half time, so breaks in play. Yes, there's no promotion by commentators or representatives on the telecast. So we're pretty comfortable with Australia does a good job of putting in place appropriate measures in this space. If further advertising restrictions sort of were to come into play, obviously, as a company that is looking to grow. We'd argue that we tend to favor the incumbents that already have certainty with scale. So we obviously would not like to see that occur. And we don't believe it's [indiscernible] given the really strong restrictions and guidelines that are currently placed.

Yes. [ Steven ] has asked a further question here. "There are different regulations regarding political donations in the U.S., Canada and Australian gambling sectors. What are our pulses on political donations?" We don't -- we have a policy. We don't make any donations. [ Steven ] has asked another question. "There have been a lot of share dealings by insiders over the past 18 months. Are there more intentions to sell down? Are there any constraints still in place in terms of [indiscernible] being able to sell stock?" During the course of the year -- [ Steven ], I'm just thinking about this question, but during -- since we listed, there's obviously the ASX escrow rules, which inhibited preexisting shareholders -- inhibited their ability to deal in shares. That period is well and truly lapsed now. It occurs to me that during that period, there was an unescrowed shares, which were free to be sold by some, including myself. To my knowledge, no one elected to sell non-escrowed shares during that broader period. In terms of dealings, because we've had 2 capital raisings and 2 rights issues, there have been a number of lodgments made detailing the director's and insider's change in shareholders, which is, by and large, been accretive, people taking out their rights and so forth. So we're really only down to -- the one matter where the founders chose to sell some shares, and they did so in a very coordinated, formal, legally wrapped up. Jointly, the [ manager ] agreed process, which was the founder selling parcel of approximately $29 million worth of shares half to ourselves and half to an existing institutional shareholder. We gladly took him up for $10, which was the same reference from us as the placement share. So it was a very orthodox -- not -- result of [indiscernible] way to deal with those securities. And just generally speaking, the -- let's -- I won't say insiders because we'll be talking about directors and [indiscernible] here. I think really because our trading policy is very clear that people in possession of financial information, inside information, can only deal, window of one month after the half yearly and annual results. And even so, it requires a sign up from Sam, Chief Legal Counsel, [indiscernible] the screen, Andrew, and myself, such that they -- we are absolutely sure that they're not privy to any information, which will be price sensitive and cause them embarrassment and the company embarrassment. So the only other -- to answer your last question, are there any constraints still in place in terms of insiders being able to sell shares? Sam kindly volunteered as the Chief Executive Officer when he sold parcel of shares. At the time of placement, he [indiscernible] gave a commitment to drove the managers, investors, who are participating in the placement and the rights issues, that they would not sell any further shares for a period of 12 months, which I think was unusually strong and very helpful for all shareholders to get -- to hear him say that. Generally speaking, I'm taking counsel from some really great companies. People know those great companies because all great companies are -- many great companies are found to have their founders present. And there are periods of time whether we see ourselves, we're still holding when, frankly, we want to sell some shares. And it's all about balancing your life and balancing your investment portfolio such that you're not overly exposed to one investment and one company and potentially put yourself in a position of inadvertently making poor judgment because -- or not following the company's strategy because you are, so far, too heavily invested in one particular investment. So I'm more comfortable that we found the right balance. The founders are very important to the company going forward. Have released some cash that might have gone from a figure like 9% investor -- one investor, including house and all sorts of things and school bills to pay. And I feel very comfortable that we found ourselves in a really good position. And that's not just for me as Chairman, but it's for the shareholders, full stop. There's another question here from [ Steven ]. It's really a question for the auditor. And I'll put you on notice, Peter McCluskey, Chair of the Audit Committee. You might share a comment on this and anyone else. So the question goes along the lines of, "Given that PointsBet now has a market cap of $2.7 billion and is operating in 3 countries, [ Canara ], RSM audit site, other ASX-listed companies of this size, which they audit," sorry, that's one for RSM to chime in. And one to me and the Audit Committee, "When did last tender the audit, and then sort of time we hired a big 4 audit firm?" I'm just going to pick up -- I'll just pick up on the last one. We haven't tendered the audit. And as a past chartered accountant, who has filled in -- who was practicing audit as my livelihood, I'm a bit disappointed with the audit -- the accounting industry. And the audit industry has shrunk to the position where we feel there's only 4 big audit firms in the world. If we were all about competition, free trade, there should be an abundance of large audit firms capable of doing those tasks. When I was growing up in audit, we had the big 8, and then we had the next 8, and you actually have a lot of choice. So I'm in favor of giving -- I'd be in favor of -- if the service is satisfactory and the fees are right, I don't feel like in any way obliged to the big 4. Peter, you're on mute.

Sorry about that. Having come from a similar background to Brett, albeit, the last 30 years have been in restructure and having been at a big 4 firm and also having dealt fairly closely with the RSM, they were not just in Australia, but in the U.S. as well, I think they do an excellent job, and I think they're more than qualified now to do the job. And I don't see the need necessarily to go to a big 4 firm. We use some of the big 4 firms for other things. So I think I'm quite comfortable with where we're at with them, RSM, for that matter.

Billy?

Yes. No. Thank you. Thank you for the comments. To answer the question, I think the first part of the question was, what comparable-sized companies we also audit as well? I actually did pull up a list just then for the point of name dropping. We do audit Mineral Resources Limited, a company with a market capitalization of circa $8 billion. We are also the auditors of Hansen Technologies, market cap of greater than $1 billion, was in the news recently for a potential takeover. RSM, just for the audience's benefit, we are a top 6 global accounting firm. In the U.S. where the company is expanding, we're actually top 5. We certainly have got the scale and resources to service PointsBet. PointsBet is clearly one of our key clients, and they receive a lot of attention from us, and I'm glad to hear both the Chairman and Chair of Audit Committee's comments regarding their satisfaction of our services. I'll leave it at that. If there's a follow-up?

Okay. And also have done -- we've responded to the questions on the page. Perhaps if we move to the first resolution then, which is as follows. First resolution is for the appointment of Ms. Kosha Gada as Nonexecutive Director. The resolution and summary of the votes received before the meeting now appear on the screen. Kosha Gada was appointed to fill in [ casual ] vacancy on the 3rd of May 2021 and is a seasoned executive with expertise at the nexus of media, technology and digital business models. She's currently the Chief Executive Officer and Managing Director of Recastled LLC, a media and technology incubator and advisory firm. Prior to Recastled, Kosha was Corporate Executive Director of Strategy at the Comcast Corporation in the United States. I'm delighted of Kosha's expertise and strong knowledge of the U.S. media landscape and digital businesses, has already provided a great benefit to the company. I will now hand over to Kosha to say a few words.

Thank you, Mr. Chairman, ladies and gentlemen. As Brett mentioned, my appointment as Nonexecutive Director to the Board was announced on the 3rd of May 2021, and it is an honor to seek election from security holders on my candidacy today. I bring significant U.S. media industry and corporate strategy experience from senior roles and executive advisory and entrepreneurial capacities. I'm currently Founder and CEO of Recastled LLC, a boutique media-focused management consultancy and incubator. I was previously Corporate Executive Director of Strategy of the Comcast Corporation in Philadelphia and, prior to that, a principal and leader in the media practice at Kearney in New York. In each of these roles, I have served the CEO and the Board agenda of industry-defining companies on matters pertaining to organic and inorganic growth, digital transformation, innovation and consumer marketing. It has been a privilege to join the Board of PointsBet and serve alongside an incredibly high-functioning, skillful and respectful group of colleagues. The Board has consistently demonstrated its ability to respond to the fast-paced demands of our industry while maintaining diligence and rigor in our decision making and governance duties. With your support, I look forward to continuing to contribute my expertise to the collective skill set of the Board and help PointsBet navigate the exciting opportunities and complexities we face ahead. Thank you very much.