Spacetalk Limited (SPA) Earnings Call Transcript & Summary

Good afternoon, everyone. My name is Georg Chmiel, and I'm the Chair of Spacetalk Limited, and I will be Chair for today's meeting. On behalf of the Board of Directors, it's my pleasure to welcome you all to our Annual General Meeting of Shareholders for 2023. In the spirit of reconciliation, I would like to acknowledge the traditional custodians of country throughout Australia and their connections to land, sea and community. We pay our respect to their Elders past, present and emerging and extend that respect to all Aboriginal and Torres Strait Islander peoples today. As there's a quorum present and it is after the appointed time for the meeting, I declare the 2023 Annual General Meeting of Spacetalk open. My fellow directors, Mike Rann, Martin Pretty, Dr. Brandon Gien and Simon Crowther joined us also today. The technology are locked in to allow shareholders, proxyholders and guests to virtually attend the meeting. All attendees can watch a live webcast of the meeting. In addition, shareholders and proxyholders have the ability to submit questions and vote. Written questions can be submitted at any time. To ask a question, select the Q&A icon at the top of the page on the virtual meeting platform and select the topic your question relates to and type your question in the text box then press submit to send. Please note that while you can submit questions from now on, I will not address them until the relevant time in the meeting. Please also note that your questions may be moderated or if we have received multiple questions on one topic, amalgamated together. Finally, due to time constraints, we may run out of time to answer all of your questions. If this happens, we will answer them in due course via email or on our website. For those shareholders who wish to ask a verbal question, an audio questions facility is available during this meeting. To use this service, please follow the instructions below the broadcast window on the virtual meeting platform, and the moderator will facilitate your participation in the meeting at the appropriate time. You will be able to listen to the meeting while waiting to ask your question. Prior to asking your question, please state your name and the name of the shareholder you represent. If you have any issues using this system, please refer to the online meeting guide available at www.computershare.com.au/virtualmeetingguide or contact Computershare on +613-9415-4024. I encourage shareholders who are attending online to submit questions and/or requests to address the meeting as early as possible. I will ask the Company Secretary, Kim Clark, to act as the moderator for the meeting and read out any written questions or advice of any shareholders or proxyholders with verbal questions. In the event that I'm disconnected from the meeting and cannot immediately rejoin due to technology failure, Martin Pretty will assume the role of Chair of this meeting. Voting today will be conducted by way of a poll on all items of business. In order to provide you with enough time to vote, I will shortly open voting for all resolutions. At that time, if you're eligible to vote at this meeting, a vote icon will appear at the top of the page of the virtual meeting platform. Selecting this item will bring up a 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 the submit or enter button as the vote is automatically recorded. Please ensure that you scroll down the page to view and vote on all resolutions. You do have, however, the ability to change your vote up until the time I declare voting closed by selection. Click here to change your vote for the respective resolution and selecting another voting option. I appoint David Bernard of Computershare Investor Services to be returning officer and to conduct the poll. I now declare voting open, and I will provide ample notice to complete your voting prior to the closing of voting. Attending from the Spacetalk executive team are Tonderai, the CFO; and Company Secretary, Kim Clark; as well as many others, Chris Nir, CMO; and Craig Boshier, COO. In addition, the company's auditor, Mathew King of William Buck is also in attendance. Our auditors will be available to take questions on the audit report later in the meeting, if so required. No apologies have been received for today's meeting. I will now provide a brief address followed by Simon, who will provide a company update prior to commencing the formal business of the meeting. Fiscal year '23 has been truly a transformational year for the business, a year in which we repositioned and reinvented Spacetalk to a sustainable business with a clear strategy and high-quality leadership under the helm of Simon Crowther, our CEO, MD, to execute that strategy. In fiscal year '23, we completely restructured the operations and resolved the limitations of the previous capital strategy to support future profitable growth. All this was done in a very short period of time, in particular, in the second half of fiscal year '23 and the first half of fiscal year '24, which is truly remarkable and for which the Board of Directors would like to thank all employees and leaders in the business. Spacetalk is now an emerging wearables-enabled software subscription and mobile virtual network operator business centering around the theme family safety. While investment was required to support the transformations, the results show already significant improvement in the operational and financial metrics of the business. The capital raise conducted in quarter 1 fiscal year '24 will further enable the delivery of our growth. As we reflect on our journey, I want to also expressly heartfelt show gratitude to our shareholders for their unwavering support, dedication and trust in Spacetalk's vision and leadership team. Your belief in our vision and commitment has been another cornerstone of our success, and I'm honored to address you today with sincere appreciation. The journey ahead holds promise and potential, and we are eager to embark on it together hand in hand. Together, we will continue to build a future that is prosperous and sustainable. I will now hand over to Simon to provide a company update.

Thank you, Georg. Good afternoon. It's great to have the opportunity to meet with you today at my first Annual General Meeting as CEO. We've achieved a lot in the short period of time since I took on the role in February. We're starting to see some of the results flow, and I'm looking forward to sharing details of recent performance and importantly, what the rest of the financial year looks like and our priorities. I appreciate this is largely a meeting focused on prior year performance and the annual report. I think the time with you is best spent updating you on recent trends, performance and outlook as we continue to focus on execution and the path to profitability. First, some important context that drove key decisions and priorities in the first 6 months of my tenure that's leading to the transformation of the business. To be successful, it was vital we reset aspects of the business and clearly lay out our growth strategy. We achieved both aspects in May when we released our growth strategy, whilst indicating the need to scale back our international operations temporarily. The situation was unfolding. As I'm sure you can appreciate, it does take a bit of time to get across all aspects of the business for the appropriate remedial measures in place. I think it's important to reiterate that it's essential to take this action to deliver our growth-focused agenda. Our primary goal is to get our business model working profitably in our home market of Australia and New Zealand.to set ourselves up for controlled international expansion. We are focused on building recurring revenue of between $20 million to $25 million within 3 years, excluding hardware sales. And each watch sell should now be viewed as a low-cost customer acquisition by the Spacetalk Mobile or Spacetalk app subscriptions. Selling hardware with no reoccurring revenue or ownership of the customer relationship or adequate margin on the hardware is not a viable strategy to maximize the opportunity to a long-term value for shareholders. To achieve this growth, we need the people and the products to deliver the commercial outcomes. We've worked hard in recent months to attract top operators who bring domain expertise whilst managing costs to execute our plan. In addition, we've delivered a range of new hardware and software products that will drive our subscription growth, and I'm really pleased with the caliber of the people in our organization now. I feel we're at an important inflection point in the company's journey, and it's helpful for those of you less familiar with our strategy to reflect on our new direction on what it is that makes Spacetalk compelling for customers and investors. We've made a considered and distinct shift in our positioning away from being predominantly a child's wearables business at the start of the year to a wearables-enabled subscription and data business. We're building an ecosystem of integrated and complementary products that focus on providing family safety at all stages of life with freedom and peace of mind. We connect with families through our watches and companion apps. We connect with families through Spacetalk Mobile using the Telstra network. And we connect with families to help their kids get to and from school safely through our Spacetalk School service. We understand who our customers are. We are determined to get closer to schools and educators across the country, build our engagement with families, particularly mom and dad; be a trusted and reliable partner to help Grandma and Grandad and other seniors feel secure and less vulnerable so they can continue to live full lives and in future, extend our services to support employers and workers also. These customer segments offer us established and growing revenue streams. Hardware sales remains the largest but will be overtaken by high-margin Spacetalk Mobile and app software and SMS subscriptions. We have clarity on our market opportunity, and recent new product releases are specifically designed to unlock the potential of these addressable markets. For the first time with family app, we now have a product for tweens and teens as they migrate from Spacetalk watch to their first smartphone. We will have an exciting announcement to make about our reconfigured Life mobile personal emergency response device that will now start to unlock the aged care sector. Our soon-to-be launched Spacetalk Mobile handset plans mean no longer confined to wearables as we expand our offerings to meet the mobile needs of the whole family. These initiatives are the start of our ability to address a larger addressable market and increase customer lifetime value. So how did we do? Well, we completed the challenging reset while ensuring operations of the business continued, which is never easy. And the business has a focused strategy, which we're now executing on. The new team has only been in place for 2 full quarters. And pleasingly, we have made solid progress. The metrics moved in the right direction as we continue to prove we have an appealing, scalable and profitable business model. During FY '23, we saw the shift in the revenue mix with 54% of total revenue being recurring revenue. We saw a healthy 33% growth in ARR to $8.3 million for Q4 FY '23 with Spacetalk Mobile making a significant contribution of $2.6 million from $0 in the prior year. Subscribers grew 17% to 70,000 with, again, Spacetalk Mobile being the growth engine with 14,720 subscribers since launch in October 2022. How are we doing now? Well, Q1 was a big quarter for us, and we've covered a lot of ground. We delivered 35% growth in ARR, again, powered by Spacetalk Mobile subscriptions. We grew revenue from continuing operations by 100% to $3.6 million. And we achieved this through a combination of more effective retail leadership internally and execution of our retail engagement externally, resulting in increased hardware sales, growing Spacetalk Mobile subscriptions and generally, a more disciplined team making smarter decisions. We are acutely aware of the need to manage our expenses. We run a tight ship with enhanced financial reporting and cost controls in place reflected by our improved cost-to-income ratio reduced to 80% from 157%. We raised $3.3 million in a placement and rights issue to support us through to our key goal of being cash positive in the second half of the year. We also work with our friends at Pure to restructure our debt, increase the tenure and improve the covenants. We communicated clear Horizon 1 goals. So now is a good time to update you on delivery and an overview of some new initiatives we look forward to that will drive our growth plans. We established May to December as our Horizon 1 time frame and have delivered everything we said we would do: our new ADVENTURER 2 and Loop watches, our new device-agnostic family app aimed at tweens and teens, only a larger addressable market, and an all-new Spacetalk Schools app built on our new tech stack. Before the end of this quarter, we will launch our new 4G and 5G handset plans in addition to our wearables. So we will have a seamless pathway to grow with children as they move beyond watches to their first smartphones. With the family app, we offer most of the same benefits of the watch for older kids as they hit their teenage years. In addition to the teen market, I'm pleased to announce our move into the seniors and aged care sector through a partnership with an established national provider of monitored medical alarms and call center services. Our partner will provide 24/7 monitoring services for our newly refreshed Life Watch, which is now a fully fledged mobile personal emergency response, or mPERS device. The Life Watch will be bundled with a subscription to Spacetalk mobile, plus 24/7 monitoring. And through this relationship, we will have access to new market opportunities, such as retirement villages and occupational therapists. This is another important step in Spacetalk becoming synonymous with family safety as with a touch of a button on the Life Watch, the monitoring service will be alerted or the Life Watch will detect a fall and connect immediately with the monitoring service to the appropriate help can be coordinated. As with the teen market, the seniors market is new for us, and we'll focus on establishing our presence and initial monetization and refining our product offering as we onboard these customer groups for the first time. By the end of this financial year, my expectation is that we can demonstrate growing subscriptions across a much broader customer group with an ecosystem of interrelated products and services. We will also be much more adept at understanding our customers and being effective at relationship marketing to deepen relationships and trust, minimize churn and maximize inside sales and cross and upselling as we establish customer success inside our business for the first time. Looking ahead at our Horizon 2 priorities, which we categorize as now until May 2025, which is the 2-year anniversary of our strategy activation, everything is focused on establishing the foundational pillars of the business in Australia and New Zealand. These are things such as standard products and scalable processes with consistent quarterly free cash generation as we head towards $20 million to $25 million of ARR. We will focus on cost management as we look to efficiencies within the business, particularly offshoring standard tasks. The automation of level 1 customer service inquiries as we significantly enhance our current capabilities, an approach that we are set to expand our footprint overseas in a controlled and focused way, will give us a clear pathway to commercial success. I would also like to enhance our credentials in the family safety and security space by developing our own IP while collaborating with universities and other organizations that may have interesting intellectual property and technology we can license or otherwise acquire for exclusive use. Let's make full use of the research and development rebates available to us in Australia and build our credentials in the family safety category and create unique capabilities that deliver competitive advantage and give our customers reasons to keep buying our products. Finally, let me briefly touch on our outlook for this year. We have set ourselves an ambitious goal to reset the business, rehire the team, reposition the company, launch multiple new products and open up new sectors. We also want to achieve a cash flow positive second half. We're building the team and the structure to achieve our stated goal of $20 million to $25 million of recurring revenue within 3 years, looking to overseas markets in due course. Whilst I appreciate there is a frustration amongst shareholders about past decisions, there's nothing I can do about the past. But what I can do is create a better future. I appreciate there have been many ups and downs over the years and wish to reassure you that my aim is to demonstrate discipline and focus and start to show the benefits of consistent quarterly performance and delivery. I believe we have a much bigger opportunity now than we did at the beginning of the year, and I relish the challenge to prove the naysayers wrong over the outcome for shareholders that this business is capable of. My thanks to the Board and Georg and for their unwavering support and to you, our shareholders, for participating in our recent round and support of our growth agenda. I will now hand back over to Georg to move on to the formal business of the meeting. Thank you.

Thank you, Simon. Kim, are there any written questions in respect of these presentations?

Georg, we do have one question from Mr. [ Jonathan Wine ]. He states that he appreciates the hard work that the company has done to reset the business towards profitability. This obviously has not translated into the share price, which is today the lowest it has ever been. Is there anything being done or considered in this regard? Or is the company taking the view that the share price will take care of itself as the company continues to deliver?

So the company's position on this point -- so thank you for the very well-worded question. The company is planning of increasing the investor relations activities now on the back of the first level of solutions being delivered. The company was in no position to reach out to shareholders on a greater scale in earlier months because so much was still being built. Now we have something to prove that there are things in place, and the whole plan going forward is far more credible now. So from that perspective, I do believe that increased activity in investor relations as well as continued delivery of results will eventually result in an increase in share price.

That's the only written question, Georg.

Are there any verbal questions?

There are no verbal questions at this time.

Okay. So we come to the order of business. The agenda items for our meeting today are shown on the screen. The Notice of Meeting was made available to shareholders from 13 October 2023. And if there's no objection, I shall take the Notice of Meeting as read. Where a vote is required on a particular item, the valid proxies received in advanced of the meeting for the proposed resolution will be shown on the screen to enable shareholders to view as each item is considered. I will address each resolution and any questions received in respect of each resolution during each item of business. I note that as Chair, I intend to vote undirected proxies held in favor of all resolutions other than resolution 17, which I will vote against. Your Board recommends that you vote in favor of all resolutions other than resolution 17, which the Board recommends that you vote against. The first item of business is for shareholders to receive and consider the 2023 Annual Report, which contains financial statements of the company for the year ended 30 June 2023 together with the directors' statement and report and the auditor's report on those financial statements. The 2023 Annual Report has been published and was circulated to shareholders requesting a copy and is available on the company's website. I trust everyone has had ample opportunity to consider it. No shareholder vote is required in relation to this item of business. This is an appropriate time to raise any questions on these reports or on our business in general to raise them now. This is also the appropriate time to raise any questions you might have of the auditor which are relevant to the conduct of audit and preparation and content of the audit report. Kim, are there any questions in respect of this item of business?

Georg, there are no questions at this time.

Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

There being no further questions, I invite you to submit your vote. We will move on to the next item. The next item of business is the adoption of the remuneration report for the year ended 30 June 2023. The motion before the meeting is to consider and, if thought fit, pass the following resolution in accordance with section 250R(2) of the Corporations Act, that the company adopt the remuneration report for the year ended 30 June 2023. In accordance with section 250R(2) of the Corporations Act, the remuneration report is contained within the company's Annual Report 2023. The vote on this resolution is advisory only and does not bind the directors of the company. The proxy details are displayed. I would highlight that in accordance of the Corporations Act, no votes may be cast on this resolution by or on behalf of a member of the company's key management personnel or their closely related parties. I will refer to these people collectively as prohibited voters. A prohibited voter may vote directed to proxies where they do so for another person who is not themselves a prohibited voter. As Chair, I may also vote undirected proxies for a person that is not a prohibited voter in accordance with my stated voting intention to vote all available proxies in favor of this resolution. For the purpose of this resolution, a prohibited voter includes a member of the key management personnel named in the remuneration report. Kim, are there any questions in respect of this item of business?

Georg, there are no questions at this time.

Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

There being no further questions, I invite you to submit your vote. The next motion before the meeting proposes the reelection of Martin Pretty as director. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That Mr. Martin Pretty, who retires in accordance with Listing Rule 14.5 and clause 19.3 of the constitution and who offers himself for reelection, is reelected as a director of the company. The proxy details are displayed. Kim, are there any questions in respect of this item of business?

Georg, there are no questions at this time.

Do we have any verbal questions?

There are no verbal There are no verbal questions at this time.

There being no questions, I invite you to submit your vote. As a result of Mr. Jain's retirement, resolution 3 has been withdrawn and will not be put to the meeting. So we move on to resolution #4. The next motion before the meeting proposes the election of Simon Crowther as director. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That Mr. Simon Crowther, who, having previously been appointed to fill a casual vacancy, retires in accordance with Listing Rule 14.4 and clause 19.2 of the constitution and having consented to act and being eligible is elected as a director of the company. The proxies are being displayed. Kim, are there any questions in respect of this item of business?

Georg, there are no questions at this time.

Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

Then I would express my congratulations to both Simon and Martin and also would like to thank Saurabh for the services provided as a director. Resolution #5. The next motion before the meeting proposes the ratification of the prior issue of 3,587,538 options. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That for the purposes of Listing Rule 7.4 and for all other purposes, shareholders ratify the prior issue of 3,587,538 options, which were issued pursuant to services agreement as announced to the ASX on 17 February 2023, on the terms and conditions set out in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions in respect of this item of business?

Georg, there are no questions at this time.

Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

There being no questions, I invite you to submit your vote. The next motion before the meeting proposes the ratification of the prior issue of 34,622,727 shares. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That for the purposes of Listing Rule 7.4 and for all other purposes, shareholders ratify the prior issue of 34,622,727 shares, which were issued pursuant to a placement as announced to the ASX on 21 August 2023 and on the terms and conditions set out in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions in regard to this item of business? Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

Kim, any question in respect to this item?

Georg, there are no questions at this time.

Thank you. There being no questions, I invite you to submit your vote. The next motion before the meeting proposes the issue of a warrant to Pure Asset Management Pty Ltd in its capacity as trustee for the Income and Growth Fund. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That for the purposes of Listing Rule 7.1 and all other purposes, shareholders approved the issuance of warrant to Pure Asset Management Pty Ltd in its capacity as a trustee for the Income and Growth Fund on the terms and conditions set out in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions in regard to this item of business?

Georg, there are no questions at this time.

And any verbal questions?

There are no verbal questions at this time.

There are being no questions, I invite you to submit your vote. The next motion before the meeting proposes the approval to issue up to 17,311,364 options to placement participants. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That for the purposes of Listing Rule 7.1 and for all other purposes, shareholders approve the issue of up to 17,311,364 options on such terms and conditions more particularly described in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions?

Georg, there are no questions at this time.

Are there any verbal questions?

There are no verbal questions at this time.

There being no questions, I invite you to submit your vote. The next motion before the meeting proposes the approval of the issue of shares and options to directors. The motion is to consider and, if thought fit, pass the following resolutions as an ordinary resolutions: That for the purposes of Listing Rule 10.11 and for all other purposes, shareholders approve the issuance of the following shares and options to directors as a result of their application to participate in the shortfall component of the entitlement offer as announced to the ASX on 28 August 2023: 3,421,864 shares and 1,710,932 options to Mr. Martin Pretty, Nonexecutive Director, or his nominee; 1,453,227 shares and 726,614 options to Mr. Brandon Gien, Nonexecutive Director, or his nominee; 3,411,514 shares and 1,705,757 options to Mr. Georg Chmiel, myself, Nonexecutive Director, or his nominee; 582,182 shares and 291,091 options to Mr. Saurabh Jain, Nonexecutive Director, or his nominee; and 1,136,364 shares and 568,182 options to Mr. Simon Crowther, Executive Director, or his nominee; in the company on such terms and conditions more particularly described in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions with regards to this item of business.

Georg, there are no questions at this time.

Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

There being no questions, I invite you to submit your vote. The next motion before the meeting proposes the approval to issue up to 5,825,959 options to Veritas Securities Limited. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That for the purposes of Listing Rule 7.1 and for all other purposes, shareholders approve the issue of up to 5,825,959 options on such terms and conditions more particularly described in the exploratory memorandum. The proxy details are displayed. Kim, are there any questions?

No questions at this time, Georg.

Do we have any verbal questions?

There are no verbal questions at this time.

Okay. The next motion before the meeting proposes the approval to issue up to 38,636,364 options to Entitlements Offer Underwriters. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That for the purposes of Listing Rule 7.1 and for all other purposes, shareholders approve the issue of up to 38,636,364 options on such terms and conditions more particularly described in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions in respect to this item of business?

Georg, there are no questions at this time.

Do we have any verbal questions?

There are no verbal questions at this time.

There being no questions, I invite you to submit your vote. The next motion before the meeting proposes the approval of the company's equity incentive plan. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That for the purposes of Listing Rule 7.2, exception 13(b) and for all other purposes, shareholders approve the company's equity incentive plan as described in the explanatory memorandum. The proxy details are displayed. Are there any questions?

Georg, there are no questions at this time.

Do we have any verbal questions?

There are no verbal questions at this time.

There being no questions, I invite you to submit your vote. The next motion before the meeting proposes the issue of performance right to Executive Director, Simon Crowther. The motion is to consider and, if thought fit, pass the following resolution as an ordinary resolution: That pursuant to Section 208(1)(a) of the Corporation Act, Listing Rule 10.14 and for all other purposes, shareholders approve the granting of, a, 3,000,000 performance rights to Mr. Simon Crowther, Executive Director, or his nominee and up to 20,769,231 performance rights to Mr. Simon Crowther, Executive Director, or his nominee, under the company's equity incentive plan and on the terms and conditions set out in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions with regards to this item of business?

Georg, there's no questions at this time.

Are there any verbal questions?

There are no verbal questions at this time.

There being no further questions, I invite you to submit your vote. The next motion before the meeting proposes the issue of shares to nonexecutive director. The motion is to consider, and if thought fit, pass the following resolution as an ordinary resolution: That pursuant to Section 208(1)(a) of the Corporations Act, Listing 10.14 and for all other purposes, shareholders approve the granting of: 239,234 performance rights to Mr. Georg Chmiel, Nonexecutive Director, or his nominee; 159,490 performance rights to Mr. Martin Pretty, Nonexecutive Director, or his nominee; 159,490 performance rights to Mr. Brandon Gien, Nonexecutive Director, or his nominee; 159,490 performance rights to Mr. Saurabh Jain, Nonexecutive Director, or his nominee; and 159,490 performance rights to Mr. Michael Rann, Nonexecutive Director, or his nominee; in the company on such terms and conditions more particularly described in the explanatory memorandum. The proxy details are displayed. Kim, are there any questions?

Georg, there are no questions at this time.

Do we have any verbal questions?

There are no verbal questions at this time.

There being no questions, I will move on to the next item. The next motion before the meeting proposes the approval of the 10% placement facility. The motion is to consider and, if thought fit, pass the following resolution as a special resolution: That pursuant to and in accordance with Listing Rule 7.1A and for all other purposes, shareholders approve the issue of equity securities up to 10% of the issued capital of the company at the time of issue calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 over a 12-month period from the date of the Annual General Meeting, at a price no less than that determined pursuant to Listing Rule 7.1A.3 and otherwise on terms and conditions set out in the explanatory memorandum. The proxy details are displayed. Are there any questions?

Georg, there are no questions at this time.

Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

There being no questions, I invite you to submit your vote. The next motion before the meeting proposes the appointment of the auditor. The motion is to consider and if thought -- if in favor, pass the following resolution as an ordinary resolution: That for the purposes of Section 327C(2) of the Corporations Act 2001 and for all other purposes, William Buck of South Australia of Level 6, 211 Victoria Square, Adelaide 5000, having consented in writing to act as auditors of the company, be appointed as auditors of the company. The proxy details are displayed. Are there any questions, Kim?

Georg, there are no questions at this time.

Do we have any verbal questions from shareholders?

There are no verbal questions at this time.

The next and last motion before the meeting proposes a conditional Board spill meeting. The motion is that the following resolution is conditional upon at least 25% of the votes cast on the resolution proposed in resolution 1, remuneration report, being cast against the adoption of the remuneration report, commonly known as a second strike. To consider and, if thought fit, to pass the following ordinary resolution: That an extraordinary general meeting of the company, spill meeting, be held within 90 days of the passing of this resolution; all of the nonexecutive directors in office when the Board resolution to approve the directors' report for the financial year ended 30 June 2023 was passed and who remain in office at the time of the spill meeting cease to hold office immediately before the end of the spill meeting; and resolutions to appoint persons to offices that will be vacated immediately before the end of the spill meeting be put to the vote of shareholders at the spill meeting. The proxy details are displayed. As previously mentioned, the Spacetalk Board of Directors recommend that you vote against this resolution. Are there any questions with regards to this resolution?

Georg, there are no questions at this time.

And any verbal questions?

There are no verbal questions at this time.

Thank you. Ladies and gentlemen, please ensure that you have cast your vote on all resolutions. I will now pause to allow you time to finalize those votes. I will pause for 90 seconds. [Voting]

Okay. Voting is now closed, and I formally charge [ David Bernard ] of Computershare as returning officer to count the votes. We will publish the final voting results with the ASX and on our website later today. Thank you for your attendance today. That concludes the formal business of the meeting. There being no further business, I now declare the meeting closed.