Regal Partners Global Investments Limited (6L20.F) Earnings Call Transcript & Summary

Okay. Well, everyone, welcome. Good morning, everyone, and thanks for coming to our new venue. I'll begin today by acknowledging the traditional owners of the land on which we meet, the Gadigal people of the Eora Nation and pay my respects to elders past, present and emerging. My name is David Jones, and I'm the Chairman of VG1. Thank you for joining us today at our 2024 Annual General Meeting. The company secretary has advised me that we have a quorum, so I'll declare the meeting open. The notice of meeting, which was sent to shareholders on the 24th of October, will be taken as read. I am chairing today's meeting from DLA Piper's office at Martin Place in Sydney. With me in the room are my fellow directors Adelaide McDonald and Noel Whittaker and Lawrence Myers will be here shortly. Also, Ian is not here yet, but Candace Driver one of our 2 Company Secretaries is here. Thanks, Candace. And Brendan O'Connor, the CEO of Regal Partners, which is the manager of VG1, I think will be here shortly also. Clearly, the 9:00 a.m. kickoff has got a few people challenged. We have boardroom outside. Pitcher are here. Chris Chandran and Aiden Evans are here. Thank you, guys. Now, we are pleased to be conducting today's meeting in a hybrid format, meaning that people can participate in person, online or over the phone. This will provide plenty of opportunities for shareholders to ask questions during the meeting. Please refer to the meeting materials distributed to shareholders for information on how to participate. I'll run through the key points shortly. Now, turning to the agenda for today. As shown here, given the Portfolio Manager's most recent webinar was held just last month, today's meeting will focus on the key items in the notice of meeting. I will firstly give a short introductory address. We'll then move on to the resolutions where I'll take questions on each resolution. Following this, there will be an opportunity to ask general questions and we will then collect the votes. Once we formally conclude the AGM, we will host light refreshments for shareholders attending in person. Please note that the RG8 AGM will follow shortly afterwards. So, I'm going to try to be done here latest 10:15, so an hour and a quarter. You should have got these cards when you entered. 1 of 3 colored cards. Blue cards were given to shareholders who have not submitted proxy forms prior to the meeting and proxy holders. Blue cards can therefore vote on the resolutions put forward. You're also entitled to ask questions when prompted through the course of the meeting. Red cards are for people who have submitted their proxy forms prior to the meeting and therefore cannot cast votes during the meeting. Red card holders are also able to ask questions during the relevant part of the meeting. White cards are given to non-shareholders and guests who cannot vote or ask questions during the meeting. You can complete your voting at any time during the meeting. Just make sure that you give your card to one of our Board room representatives before we close voting at the end of the meeting. For those of you in the room who wish to ask a question of the Board, when we reach the relevant part of the meeting, if you have a blue or red card, please put up your hand, show your card, we will then provide you with a microphone to ask your question. Depending on the time and the number of questions, we may need to limit each shareholder to 2 questions or comments per item of business. For those of you who have logged on to the webcast with your username and password, you will have the opportunity to submit questions online as well as vote on those resolutions. If you have already prepared a question, please submit it now, and we will aim to answer it at the appropriate stage. If your question relates to a specific resolution or the financial report, please state the resolution number and reference the financial report at the start of the meeting. All other questions will be considered during the section for general questions. I will just note, Brendan O'Connor has just arrived, the CEO of Regal and Ian Cameron, the CFO and Wirecard. Thanks, guys. Welcome. If we receive multiple questions on the same topic, we may group those together. Again, depending on the time and the number of questions, we may also need to limit each shareholders to 2 questions or comments per item of business. With regard to online voting, to give you ample time to vote, we are going to open the polls now, please. This means you can submit your online votes at any time between now and when we close the polls at the end of the meeting. If you change your mind about any vote, you can also override your original vote between now and when the polls close. For those of you who have logged into the webcast as a guest, you will be able to view our webcast, but not submit questions or vote. For shareholders who have joined over the phone, if you have provided your password to the call center and been verified, you will be able to ask questions. Please note that the process for registering your questions is very different to the webcast. For those on the phones, please do not try to register for any questions or comments yet as we will only open the phone lines when we reach each item of business. When you arrive at -- when we arrive at the first item, we will be asking if you want to register for a question on that topic. You can register at that point by pressing star 1. Once we have finished that item business, we will move to the next item of business and repeat the process. Please do not register to ask a question for an item of business before we reach that item. In order to give shareholders a reasonable opportunity to ask questions, once we have answered the shareholders' question, we will move to the next person in the phone queue. If you have additional question or comment on that same item of business, please press star 1 to register for the queue again. For other people on the phone that is guests and shareholders who have not provided their passcode to the call center, please note the phones will be listen only. I should also point out that, if you are listening on the phone, but viewing on the webcast as well, the webcast may lag by 10 seconds or more. It may be simpler just to use the webcast for the sound as well. Note that you will not be able to vote over the phone. Now with all that procedural fun handled, here is my formal address. So on behalf of the Board of VGI Partners Global Investments Limited, VG1, I would like to welcome all shareholders to today's Annual General Meeting. We thank you for your support of VG1. To begin, I hope that you all had the opportunity to hear the portfolio update that Phil King and members of the VG1 investment team gave last month. That session provided a comprehensive discussion of key VG1 holdings, earnings drivers and market commentary, and a replay of that webinar is available on the VG1 website. Further to that recent update, today's meeting will be focused on the formal business set out in the Notice of Meeting, and I will keep my opening remarks relatively brief to allow ample time for shareholder questions. Welcome, Lawrence. And I'll just note for those on the phone and the webcast, Lawrence Myers has just joined us, our other Director. So here is a very pleasing Slide, the review of FY '24 for the 12 months to June 2024. The company reported a net profit after tax of $64.1 million, representing earnings per share of $0.202 per share. This was achieved through the portfolio delivering a net return of 17.8% with an average net stock exposure of 81%. Key contributors to VG1's performance were investments in stocks exposed to the artificial intelligence semiconductor thematic, along with energy and defense stocks. Pleasingly, VG1 shareholders also benefited from a reduction in the discount of the share price to the net tangible assets, NTA over the year. As a result, VG1 delivered a total shareholder return, including franking of 29.5% during FY '24. As a reminder, this metric takes into account the increase in VG1's share price plus the grossed up value of the fully franked dividends, assuming they were reinvested. On the subject of dividends, during FY '24, 2 fully franked dividends of $0.05 per share were paid, one in September '23 and another in March '24. This approach was maintained at the time of the company's most recent results with the company announcing a further fully franked dividend of $0.05 per share, which was paid in September 2024, so after the year-end. These payments were all in line with the company's approach to targeting a dividend policy of at least $0.05 per share every 6 months. For reference, the annualized dividend rate of $0.10 per share represents a net yield of 5.2% at last Friday's closing share price or a grossed up yield of 7.4% if those dividends are fully franked. It is also worth reiterating at this point that a key benefit of VG1 being a listed investment company or LIC, is its ability to smooth its dividends. This is because a feature of LIC is the ability to allocate undistributed profits to a profit reserve. In effect, setting them aside for the payment of future dividends and increasing the ability to provide a steady income stream to shareholders. At 30 June 2024, the company's profits reserve was $274 million. Now after adjusting for the payment of the most recent dividend in September, the profits reserve is just over $260 million, which is equivalent to almost 10 years of coverage if dividends are maintained at the current annualized rate of $0.10 a share and assuming no change to the company's number of shares on issue. During the year, the company also continued to operate its on-market share buyback program, acquiring approximately 52 million shares for $91 million in FY '24. A further 24 million shares have been bought between the end of June and today. This represents a total of 144 million shares or approximately 35% of VG1's issued capital that have been purchased since VG1's buyback that was initially launched in mid-2020. The Board continues to support this buyback program on the basis that it is accretive to shareholders when we conduct it at a discount and provides additional liquidity for those seeking to trade. As shareholders will be aware, later today, we are seeking shareholder approval to allow VG1 to buy back up to 25% of its share capital over the next 12 months like we did last financial year. This is materially higher than the 10% cap, which is submitted under the Corporations Act and will provide the team with greater scope for capital management should this resolution be carried today. One other development during the year that I would like to mention was the decision in May 2024 to refine VG1's investment guidelines effective 1 July 2024. The most notable outcome of this review was an increase in VG1's gross exposure limit from 150% to 200%. This percentage reflects the value of VG1's long positions plus its short positions relative to the company's net tangible assets. The investment team of VG1 proposes this change as it can provide additional flexibility in managing the portfolio and allow a wider range of investment opportunities to be pursued. In recent months, we have already seen the team utilize this additional capacity with gross exposure rising from 148% as at 30 June to 194% as at 31 October 2024. Importantly, the net exposure limit of 100%, which is the value of VG1's long minus its short positions, was unchanged. For reference, VG1's net exposure sat at 99% at 30 June 2024 and has generally remained in the range of 90% to 100% since then. Now, turning to 2 corporate aspects -- now turning to corporate aspects. Many of you will recall that VG1's Investment Manager, VGI Partners merged with Regal Funds Management in June 2022 to form Regal Partners Limited, so -- coming up on 2.5 years ago. During 2023, investment responsibilities were then transitioned from VG1's Chief Investment Officer, Robert Luciano, to Regal's Chief Investment Officer for long/short equities, Philip King. We believe this handover has been very smooth. And furthermore, Regal Partners itself has continued to grow and now has over 90 investment professionals across the entire group. This gives Phil and the VG1 investment team the opportunity to collaborate with other team members within Regal Partners that have expertise across a broad range of sectors, regions and asset classes. We look forward to VG1 shareholders benefiting from this deep pool of talent. And again, I just want to come back to the numbers as shown here on this slide. This is our second full year with Phil and Regal running the VG1 portfolio, 17.8% portfolio performance and 29.5% all-in performance. Also with regard to shareholder engagement, it was pleasing to see Regal Partners hire 2 new investment directors in FY '24 who have been strong -- who have strong relationships across financial advisers, brokers and individual investors. Both have been very helpful in marketing VG1 through a combination of roadshows, meetings, webinars and newsletters and ultimately increasing buyer demand for VG1 shares. We are also aware that shareholders are always keen to see that the investment manager is aligned with them. On this point, I note that entities and funds associated with Regal Partners and Phil King on a combined basis are a substantial shareholder in VG1. And that their stake combined recently rose to 9.6% of VG1. Consequently, Regal Partners and Phil are very in line with you, VG1 shareholders, in wanting to increase both the company's net tangible assets and its share price. Pleasingly, if we look at the period since the merger between VGI Partners and Regal Funds Management in June 2022, I think we've made very good progress on this front. For example, for the 28 months from June '22 to October '24, VG1's net portfolio return has been 32.9% and its total shareholder returns 69.6%, when including grossed up dividends for franking. That said, the team needs to work hard, if we are to sustain this and close the discount to NTA further. We're pleased that currently, the discounts come in and it's at around 5%. It's nice to be nearing our target of 0. As we've said previously, investment performance, shareholder engagement and capital management are all key to achieving success, and the team is continuing to focus on all these areas. So that concludes my Chairman's address. I would firstly like to thank the investment and operations team at Regal Partners for their ongoing efforts in managing VG1. And thank you also to you, our shareholders. We greatly appreciate your support and interest in the company, and we look forward to providing further updates in the future. So that ends the formal business. And so we will now -- sorry, ends my Chairman's address. We'll now turn to the formal business of the meeting. So I will take each item and resolution in the order set out in the Notice of Meeting. Our meeting today involves tabling and reviewing the accounts plus 5 resolutions to be decided. In terms of logistics, when we reach the point for questions, we will start with online questions from the webcast, then questions over the phone and then questions in the room. So webcast phone room, okay. For those online, please remember you can submit questions at any time during the meeting. Just please clearly type the number of the resolution that is relevant to your question or state whether it relates to our financial reports or a general question, noting we will cover general questions after the formal business. As a reminder for those on the phones, please wait until we reach each item of business before registering on that item. Please press star 1 to 2 to cancel. As we mentioned earlier, we will conduct a poll on all resolutions today, combining votes submitted before the meeting with votes that are cast during the meeting, both in the room and online. Since the online polls are already open, if you'd like to vote now, please do so alternatively. It is also fine, if you prefer to only vote after we've discussed each resolution. I will also allow some time at the end of the meeting for you to finalize your votes. For those voting online, if you make a mistake or change your mind, please select your preferred voting option, and that will override your original vote. I note that Boardroom is the returning officer for today's meeting and will conduct our poll. Certain votes will be excluded in accordance with the Corps Act and the ASX listing rules. The proxy votes will be shown after discussion of each individual resolution. I advise the meeting that I will be voting all undirected proxies in favor of all resolutions as indicated in the Notice of Meeting. As the results of the poll will not be available before the meeting closes, they will be released to the ASX and made available on our website later today. Turning to the first item of formal business. The company requires to lay before the meeting, the last audited financial statements and reports. These were released to the ASX on the 20th of August 2024 as part of the company's annual report. No resolution on this matter is required. However, I now invite shareholders and their proxies to ask questions. Questions may also be asked of our auditors in relation to the conduct of the audit, content of the audit report, accounting policies adopted by the company and the independence of the auditor carrying out the audit. So we'll start with online questions. I'll ask Rebecca Fesq, Head of Client Relations and Strategic Partnerships, to read out the questions as they come through the webcast. Rebecca, are there any online questions on the financials? None?

There are none. Thank you.

None. Thank you. The phone?

There are no questions via the phone lines.

Excellent. Okay. Thank you, operator. Very high tech. Questions from the room on the financials, Simon?

Section 14 of the notes of the annual report, dividends. In there, you are showing a deficit in the franking credits account of nearly $8 million, which includes the payment of the September dividend. Now, I can see that you haven't made money since the 30th of June, looking at the NTA, which was $2.23, it's now $2.01. So how are you going to pay tax to generate franking credits? And how are you going to, first of all, find the $7.6 million to pay for the last dividend.

Yes. So there are -- and Ian can correct me here. There are 2 ways that we generate franking credits. One is when we receive franking credits from our portfolio of locally held long positions. And then the other one is when we realize gains. And so whilst the net portfolio performance may be not showing large profits for the 3 or 4 months to date within the portfolio, there are many positions that are up and there will be many positions that are down. And so if we happen to choose to sell some of our winning positions, be they long or short for a profit, then that generates franking credits. So there is a way to continue to generate credits even if it might not look like it from the aggregate. We won't be giving a forecast, but I think it's fair to say that our preference is to pay franked dividends where we can as we have in the past. It's not the first time we've had a very low balance, and we've still been able to generate enough credits during the period to pay a franked dividend. So obviously, we don't give forecast and I won't. But I think you can look to prior performance and form a view as to the likelihood of the level of franking being used for the December half and for the full year through to June. Just before I pause, Ian, what have I stuffed up there? Is that all good?

That's all good.

Okay.

Does that make sense, please?

I know perfectly, well how you make franking credits. I'm just -- you're starting negative $7.5 million. You've lost money on an NTA basis from 30 June to today. How can you possibly have confidence that you can find $7.5 million to pay back plus another what would you need $6 million to pay the next projected dividends?

It is a large portfolio. It's around 450 million shares still unissued today. It's a large portfolio. It's a large portfolio. And within that, there are some positions that have been doing well and some positions that haven't done so well, long and short. So that's all I can say. I mean, like any sensible Director, we don't give forecasts. We can say look to the past, but you'll have to form your own view as to whether our preference is to pay dividends as fully franked as we can.

So basically, there's no guarantee whatsoever that the next dividend will be franked, but no confidence.

No, that's not what I said. You can form your own view as to your confidence or my confidence. All I would say is no company gives forecasts, sensible company gives forecasts. We have a track record of paying fully franked dividends, and we hope to in the future, and we shall see what happens. That's all I can say.

All right. The second point is you're making monthly announcements of NTA, but you're posting post-tax numbers, which is not what the rest of the LIC community do. So they post pretax numbers. So one, can we start doing that? And if you won't commit to that, can somebody give me an idea what is the pretax number, which relates to, let's say, today's announcement of $2.01 post-tax, what is the pretax number so that we can figure out how much tax you are using as part of the asset. I can see that deferred tax assets are not that large anymore after this set of accounts, but can we get some numbers on that, please?

Yes. We will look into it. I'm just looking at our monthlies because we've moved around on what we do and don't provide monthly. We provide net, you are right. So all right, we will -- I mean, we used to do everything, and then I think we've simplified it. We've gone to just net. Noted.

Just posting post-tax numbers, which can include all sorts of deferred tax assets, which you may or may not ever get. So everyone else post pretax. So you take that element of -- out of it.

Done. We shall He take it on Board.

Can I get a number now from the accountants of what is the equivalent pretax, post-tax?

I don't think we're going to be declaring anything right now that not out in the broader market. I don't think that makes sense.

Well, this is the meeting for us to.

Yes, but we've released what we want to release to all shareholders. Some shareholders who can't come to this meeting. I don't think it's appropriate to give out a new number that the broader market hasn't got. But we will note your request, and we'll revert. And if we're comfortable to declare it, we will declare it. And if we're not, we'll come back to you. David?

Look, my comments will be relatively short today.

Hang on what?

You'd be pleased to know. I did compliment you at the most recent AGM, David.

You actually did. That was very pleasant. Thank you. Look, I don't mind if you say that again.

We all respect you, David. But look, to be frank, the sharp activist campaign, which has been very critical to VGI, culminated 18 months ago shareholders' meeting where Regal took over. Now you yourself, David, have correctly commented today that, that was an inflection point in the turnaround of this company. So let's celebrate that. Look, at that meeting 18 months ago, I welcome shareholders to celebrate the death of the Rob Luciano controlled VG1.

I'll just vaguely correct you, sorry, David, that was 28 months ago. It was June '22. Carry on.

Okay. Thank you for the clarification. It's also fair to say that when that change happened, that was the birth date of Regal becoming a listed funds manager. So again, an important inflection point. Now to give credit, Brendan is here, so you can take the accolade, Brendan. The changeover has resulted in, number one, an improved investment performance. Number two, as you pointed out, Chairman, a significant reduction in the discount. Number three, well done on the continued buyback. And number four, well done on paying a solid dividend. Look at last year's AGM, the VGI price was around $1.57 after $0.10 of franked -- mainly franked dividends, I believe, in the past year. The price is now $1.90, as you said, Chairman, it's been a good year for CSR, a combination of capital growth and narrowing the discount and franked dividends. So again, this is a case where the campaign to dramatically lift VG1 shareholder value has succeeded. Let's celebrate that. Congrats to the activists and also to Regal. I would point out, though, a note of caution. Aggressive Regal is expanding with multiple acquisitions. That Empire growth did not work for Perpetual, Brendan. In fact, it created constipation and a destruction of shareholder value. I appreciate Regal is a very different company, so I hope it works for Regal. But it is notoriously difficult to integrate multiple funds management platforms. Even the merger of Regal and VGI, which I call shotgun marriage, did not survive for very long with Rob Luciano departing. Single most important issue for VGI -- sorry, VG1 is the performance of Regal. My first question is either to David or to Brendan, are you concerned that Regal might suffer integration issues?

I mean, I'll comment as the Manager of -- sorry, from -- as the Chair of VG1, and Brendan might want to add something. I mean, David, thanks for your comments there. Personally, I am quite pleased now after 28 months, like a second solid year of performance. And as I said in my formal remarks, the breadth of the ideas across the group now, instead of being a team of 10 fund managers, the broadest team is up to sort of 90. Now obviously, they're not all doing global long/short, but there are really interesting other ideas coming through to our portfolio. And I will just single out one we've talked about in the past, which is PM Paul Moore have been very focused on European financial stocks, which is something that we were not focused on really at all, I don't think prior to PM Capital coming in. And that's added just a bunch of dimensions to the thinking. You heard Marco on the webcast talking about some U.K. positions. So it's a broader -- this fund is able to seek ideas across a much broader group. I would just comment, I've observed from afar. As you may recall, I was on the Regal Board until coming on 16 months ago, I think I got off the middle of '23. The businesses are integrated in my observation only to a point. They're all -- I think the plan is to consolidate into 1 office, but they're still very, very separate teams. So they're creating -- they're continuing with their own personality is my sense. And so I don't think it's a massive integration program. It's just bringing exposure in other verticals for clients, other products onto the broader Regal Group. So from the VG1 side, I'm a keen observer of what happens at Regal. But so far, we've actually been really pleased. We're convinced that it's been additive actually having groups like PM Capital come on board. And obviously, the broader thinking inside the RF1, like in Phil's broader and the whole team's broader depth. But Brendan, do you want to say anything, please, you're welcome.

I agree with everything you say, David. I think it's notoriously difficult. I think Perpetual is a great lesson for not just asset managers, but lots of businesses as they grow. I think we've got a clear line of sight as to what we need to do to maintain good performance and to continue to integrate. I think some of the best evidence of that is we've got accelerating flows right across the Regal Partners Group. And that's a reflection of organic flows, not just in Regal, but across Merricks and PM Capital, so and Taurus and other parts of our business model. So no, I agree with everything you said.

Okay. Are there any other -- thanks, David. Is there any other -- David? Yes.

This is mutual adoration -- adulation session today, everyone complementing everyone else. That's great. Look, David, as you said, the potential exposure, gross exposure of the company can go up to 200% now.

Yes.

It's interesting the fact that already the churn of the portfolio is about 3x. Certainly Regal, we all know, is a great friend of the broking community. It's very powerful there because it does a lot of trading. So 3x turnover is quite high. But look, I'd just be grateful if the auditors or David or Brendan could clarify a little bit more on the accounting. Look, we all understand net and gross. So if the gross is $200 you short half the portfolio, you're down at a net 100%. But look, if we look at the balance sheet statement financial position, $688 billion of financial assets at fair value at 30 June financial liabilities, which is, to a large extent, derivatives sitting there at $172 million liability. Just be grateful if -- because it's a pretty material point as to how this is being run. If someone could clarify the accounting treatment of those derivatives and fully appreciate, David, that absolutely fine to have plenty of profits and some losses, that's absolutely fine. But bearing in mind the split between longs and shorts, could you clarify the $688 million versus $172 million, please?

I will maybe ask the accounts or Ian if they want to say anything there. What I will just remind you is that the gross at 30 June was 148%, as I said in my remarks. So this is not -- whereas it's typically up at 190% or so currently. Can I just comment generally before we get to specifics? The Board of VG1, as I said in my remarks, reviewed the long/short limits earlier this year, I think it was in May, April, May, and we announced it then for a start on 1 July. And to be frank with you, and you observed an increase in turnover. That was from a very low level to a more -- I wouldn't say it's a super high level, but it is a material increase. And that's just Phil's style and expression versus Rob's. And I think we wanted Phil to be able to express himself further, him and his team. And so -- and we considered it carefully, and we're pleased with what it's let him do, which is push into his best ideas further long and short. So we are comfortable with that new gross level of not being a ceiling, not being 150%, but being 200%. But again, these numbers are gross -- sorry, 30 June when it was 148% was the actual number. So what was your specific question? Yes, please, Ian.

If you go to Note 9, which has the financial liabilities, so the $172 million worth of financial liabilities, only $1.7 million or $1.3 million is the equity swaps, and there's about $0.5 million worth of foreign currency forward contracts. The majority of the financial liabilities are actually listed short. So in terms from a fair value perspective, value.

But if we look at Note 9, which shows listed equities held long $669 versus the listed equities sold short $170 million. Does that reconcile with the $148 million or whatever you said, David?

Yes.

Okay. And David, just very briefly, if I can just ask on Page 50, Note G first to Rob Luciano, Doug Tynan, and Rob Poiner. Have all those arrangements expired now? Or are they still ongoing?

What is the status? They please, Ian? They are remaining on the --

The reinvestment mechanisms.

Right.

But does that mean they still participate in a share of the performance fee?

But that's not how that was ever meant to -- the extent VG1 and RG8 paid performance fees. They were -- there was a commitment there to the extent the drop the value into buy that they would receive in cash via their RPL or previously VGI Partners shareholding, there was a commitment to buy further VG1 RG8 shares. So, if they're not participating in performance fee, doesn't that commitment fall away? So legally, they remain on foot. In practice, there's no amount that's.

Thanks, Ian. Thanks, David. Okay. If there are no more questions on the financials, we will now go to Resolution 1, which is the adoption of the 2024 Rem Report. Under the Corporations Act, listed companies are required to include as part of their directors' report, a Rem Report. The Remuneration Report for financial year 30 June 2024 is included in the company's 2024 annual report. The Corporations Act requires companies to put to shareholders a nonbinding vote to enable shareholders to voice their opinion on matters included in the Remuneration Report. Given the vote is advisory only, it does not bind the Board or the company. However, the Board will take the outcome of the vote into account when considering future Rem decisions. At this point, it's worth noting that Regal Partners, the manager, pays the bulk of VG1's operating costs, including the cost of this AGM. This is a central plank of the Regal Partners' philosophy of alignment. As a result, VG1 only bears the cost of its non-executive directors plus D&O insurance. The Board recommends that shareholders vote in favor of adopting the 2024 Remuneration Report. I will now move this resolution. Are there any questions or comments on the Rem Report? I think we first go to the -- or to online.

There's no questions online.

There's no questions online. The operator, please?

There are no questions via the phone lines.

Okay. Thank you. Are there any questions in the room on the Rem Report? Okay. Thank you. Then these are the proxies for the Rem Report there. Open proxies in favor of the Chair of the meeting at the time of the meeting will be voted in favor of the resolution. Adjusting for these, the votes are 39,161,393 in favor, 62,077 other proxy discretion and 296,321 against. This equates to 99.1% in favor, 0.2% other proxy discretion and 0.7% against. For those in the room with blue cards or if you're a shareholder or proxy holder and eligible to vote online, could you now please complete your vote for Resolution 1. Alternatively, if you prefer to wait, you can do that at the end. We'll now move to Resolution 2, the reelection of the slightly tardy Mr. Lawrence Myers. With regard to this resolution, Lawrence was appointed to the Board in 2017. Mr. Myers is retiring by rotation and being eligible is standing for reelection in accordance with Clause 6.7 of the company's constitution. Mr. Myers' details are set out in the explanatory memorandum Notice of Meeting, and they are highlighted here on this slide. In summary, Mr. Myers is the Founder and Managing Director of MBP Advisory, a prominent high-end Sydney firm of chartered accountants, which he established in 1998. Mr. Myers is also the CEO of FIFO Investments, the family office for the Myers family and a number of associated families. Mr. Myers' specialist areas of practice include mergers and acquisitions, corporate and business advisory, tax consulting and advisory, succession planning and family office services. Lawrence is also a member of the Foundation Board of the Art Gallery of New South Wales. Mr. Myers has been Independent Director of ASX-listed Breville Group since 2013 and is Deputy Chairman since August 2021. Mr. Myers was also appointed as a Non-Executive Director of Accent Group and as a member of its Audit and Risk Committee and People and Rem Committee in November '23. Finally, Mr. Myers was appointed CEO of Consolidated Press Holdings in 2023. The Board, with Mr. Myers abstaining, supports the reelection of Lawrence Myers as a director. I will now move that Lawrence be reelected as a Director of the company, and I do want to say he makes a great contribution to our Board. Rebecca, any questions online or on the phone?

There are no questions via the phone lines.

Or from the room. David?

Yes. Look, noting the appointment, Lawrence, as CEO of Consolidated Press, clearly, before your time, sale of Crown Casino at the top of the market, Blackstone really appreciate that. But after your time, Jamie and his advisers have made a lot of money in shares, a big position in Navidea. Just interested in whether you have any involvement in that or whether that's the U.S. advisers? And if you do have an involvement, Lawrence, do you contribute some of those ideas to the manager here, Regal because clearly, Jamie has shot the lights out.

Thanks, David. The simple answer to your question is that I'm really not going to talk about Consolidated Press yesterday in the same way that, I wouldn't talk about any of the other families that I look after. Clearly, to the extent that information is publicly available, it's publicly available and you can make of it whatever you wish. We are not the managers of the VG1 portfolio. We are the Directors of VG1 as a company. The management of the portfolio is absolutely discharged in Regal and its investment team. And I can honestly say that, I've never made any commentary or involvement or input of any kind in the Regal or VG1 portfolios.

If I could just add to that, I respect Lawrence that you won't breach confidentiality, that's fine. But I assume the Board of VG1 has played a role in the gross exposure of the VG1 portfolio has increased from 150% to 200%. I assume you did personally play a role in forming a view whether that was a good move or a bad move?

Well, it was certainly put to us that it was suggested that the parameters for the portfolio be reset to be more accommodative to the Regal investment style. Certainly, as one of the directors on the Board, we had a proper and fulsome debate about that, and I was supportive of it as were the rest of the Board.

Okay. So you do actually play some sort of role in monitoring Regal?

Correct.

Good. Slightly different from what you said.

Thank you, David. Okay. I'll show the proxies up on the screen here. Open proxies in favor of the Chair of the meeting at the time of the meeting will be voted in favor, as I've said, adjusting for these votes, there are 38,869,732 in favor, 62,077 other proxy discretion and 2,616,610 against. This equates to 93.6% in favor, 0.1% other proxy discretion and 6.3% against. Would everyone now please complete your vote for Resolution 2. I will now move to Resolution 3, the reelection of Noel Whittaker. With regard to this resolution, Noel Whittaker was appointed to the Board in 2017. Mr. Whittaker is retiring by rotation and being eligible is standing for reelection in accordance with Clause 6.7 of the company's constitution. Mr. Whittaker's details are set out in the explanatory memorandum of Notice of Meeting, and they are shown here on this slide. In summary, Mr. Whittaker is a pioneer in the field of consumer financial education, writing weekly columns for many major newspapers. For 30 years, Mr. Whittaker was a Director of Whittaker Macnaught, one of Australia's leading financial advisory companies in 2011. He was made a member of the Order of Australia for services to the community in raising awareness of personal finance. Mr. Whittaker is a chartered tax adviser, a member of ASIC's regional liaison committee and currently an adjunct professor with the Faculty of Business at the Queensland University of Technology. The Board, with Mr. Whittaker abstaining, supports the reelection of Noel Whittaker as a Director. And I will now move that Noel be reelected as a Director. And again, Noel makes a great contribution to our Board. Rebecca, any online questions?

No.

No. On the phone? Anything on the phone, please?

There are no questions via the phone lines.

Thank you and in the room.

Noel, look, as the Chairman has said today, and we all agree, Regal is performing well. RF1, in fact, is at a premium to NTA and consequently enables equity issues to proceed. Secondly, we have a situation where, as the Chairman mentioned, Paul Moore, his vehicle has performed very well, has been at a premium. And again, so much so that Brendan has been able to do equity issues at NTA or maybe even above. I'm just interested, Noel, while we celebrate the fact that VG1 has performed dramatically better in the past year, it still is at a discount, but well done on dramatically reducing it. But do you think there's any insights you can add Noel, as to why Paul Moore's vehicle and RF1 are at premiums and VG1 is still at a discount?

I think, David, my role is financial education. I'm more interested in chasing scammers, chasing bad super funds. Investment is not my forte. I play a different role.

No scammers here. I don't think, are they?

I don't know. I don't know you.

Okay. Anyway, so you don't really have a view on that. Okay, fine. Look, second one, which you may have a view on, Noel. Look, we recognize the past and the past is the past, we all move on. But given the fact that the merger with Regal and VGI has won and truly passed. Do you think that the name of this company should change from VG1 to something that more reflects the Regal heritage now?

Look, it's something thought about. It's a possibility. To me, it's not a major issue. I don't mind. For me, it's just not a big issue. I want to see performance. The name to me is nothing much really. Not a big issue, I mean.

Okay. All right. So no real comments on either. Thank you, Noel.

Thanks, David. Okay. I'll now show the proxies on the screen. Open proxies in favor of the Chair of the meeting at the time of the meeting will be voted in favor of the resolution. Adjusting for these, the votes are 39,511,972 in favor. 62,077 other proxy discretion, 2,716,610 against. This equates to 93.4% in favor, 0.1% other proxy discretion and 6.4% against. Could everyone now please complete your vote for Resolution 3. Now move to Resolution 4, the continuation of -- or adding additional capacity as we did last year for the on-market buyback. The background of this resolution is set out in the explanatory memorandum of the Notice of Meeting and is taken as read, but I do want to touch on the key points. As I stated earlier in the meeting, the Board is supportive of an on-market buyback program on the basis that is accretive to shareholders when conducted at a discount and provides additional liquidity to those seeking to trade. This resolution seeks shareholder approval to undertake an on-market buyback of up to 67,382,076 shares in the company over the 12-month period following the approval of this resolution. This amount represents 25% of the shares on issue in the company as at the 17th of October 2024, being the last practical day before the finalization of the Notice of Meeting. The reason for the resolution is that if shareholder approval is not gained, the company's on-market buyback program can only be conducted in accordance with what is commonly called the 10/12 limit of the Corps Act. This rule allows companies to buy back shares on market without shareholder approval, but only if the total number of shares bought back does not exceed 10% of the smallest number of votes attached to voting shares on issue during the previous 12 months. Gaining shareholder approval, Resolution 4 will materially increase the company's ability to buy back shares, providing additional flexibility for its capital management program. The Board recommends that shareholders vote in favor of Resolution 4. I will now move Resolution 4. Rebecca, anything online?

No, no.

Thank you. On the phone?

There are no questions via the phone lines.

Thank you. In the room?

Look, this is a good strategy. It's been working, I suppose. What I would say is, would you not be better off offering a buyback at a much smaller discount to once and for all rid the company of the shareholders who don't want to be in it here anymore rather than this long drawn-out process of slowly reducing the number of shareholders. I've got it here that in 2021, there were 8,000 shareholders in this company. Now, there's about 5,000. So you're slowly losing shareholders. But would you not be better off to target -- offer a buyback that would allow people who want out to get out rather than drag it on like this?

Yes. Look, Simon, thank you. We constantly work on what is the right thing here. As we've discussed over many meetings, we think it is a combination of things, most importantly, portfolio performance, but then steady dividends and then engagement with shareholders. Regal have materially boosted their IR team, and I think we're starting to see that. And then the fourth plank is this program. When we look at other LICs and what they've done, some that have -- many that have tried to do a big bang, as you suggest, it hasn't seemed to have worked. And whilst it might feel like it's tedious or long drawn out, we do believe this steady program is the best way to do it. As the discount comes in, which it has recently, which is really pleasing, as I mentioned, it's around 5% today. That is -- it means that the accretive benefit of buying the shares is less to the remaining shareholders. But we are -- frankly, that reduction in shareholders from 8,000 to 5,000. On the one hand, that's a reduction in participants or liquidity. But on the other hand, that's getting rid of a lot of the people that were sort of wanted to exit. So it's a constant discussion of what is the right thing. We aren't just sitting again. And the only other thing I would say is you want an LIC to be of a certain scale. And at some point, liquidity and lack of scale becomes a problem and you can sort of spiral downwards. We don't think we're anywhere near that yet. But I don't think you want to keep buying 25% of the group for the next 10 years. I wouldn't think that you kind of might end up in a self-defeating and shrinking entity. So it's a good question. We constantly look at it. We look at what other LICs are done. But again, in our review and our observation is that a big bang typically doesn't work. And what we're doing in spite of it seems like a long time, and we've had to endure a lot of shareholder pressure over the last few years, but we think this is the best program, and it is, we think, yielding the right results. So we would like you to be patient and stick with us, because we think it is working. But it is a good question. Okay. Thank you. All right. So with that's Resolution 4, I'll read out the numbers again. I will show proxies here, open proxies in favor of the Chair of the meeting at the time of the meeting, we voted in favor of the resolution. Adjusting for these, the votes are 42,444,248 in favor, 62,077 other proxy discretion and 64,734 against. This equates to 99.7% in favor, 0.1% other proxy discretion and 0.2% against. Please complete your vote on Resolution 4. And then the final one, I think, is Resolution 5 to change the external auditor. The details of the resolution are set out in the explanatory memorandum of the Notice of Meeting are taken as read, but I do want to touch on the key points. As background of this resolution, the company's current auditor is Pitcher Partners. And earlier this year, a competitive tender process run for ongoing audit services, and the Board selected KPMG to be the new auditor of VG1. I do want to pause and go off script here though and say Pitchers have been terrific with us for the last 7 years, Chandran and Aiden and Scott. But the whole group has retendered and we're part of that. We've got the benefit of that. So we've selected KPMG. So if the resolution approve the appointment of KPMG as the company's new auditor will take effect at the close of the AGM. If the resolution is not passed, KPMG will not be appointed as auditor of the company. And if Pitcher Partners resigns as auditor, the company have no appointed auditor. In these circumstances, the Board may appoint an auditor of the company, which will hold office until the next Annual General Meeting. And if that occurs, you can probably guess who we'd appoint. The Board recommends that shareholders vote in favor of Resolution 5. I'll now move Resolution 5, Rebecca?

No, David.

Consistent. On the phone?

There are no questions via the phone lines.

In the room? Okay. Thank you. These are the proxies. I will now show the proxies on the screen. Open proxies in favor of the Chair of the meeting at the time of the meeting will be voted in favor of the resolution. Adjusting for these, the votes are 41,084,311 in favor, 62,077 other proxy discretion, 3,276 against. This equates to 99.8% in favor, 0.2% other proxy discretion and 0% against after rounding. Please complete your votes for Resolution 5. I think that's it. We've now covered all resolutions. Are there any other general questions for the Board from anyone online?

Nothing online.

Nothing online. On the phone?

There are no questions via the phones.

In the room? David?

Look, Brendan, we're not expecting you to comment on the speculation about Regal being involved in Platinum. I'll leave that one. But certainly, as I said earlier on, the single most important issue for VG1 is Regal, which is the Investment Manager, and it's done very well. So great. But there has been some press speculation that the well-performing Paul Moore fund that you now control might merge with VG1. Would you be able to clarify a little bit on that, please, Brendan?

There's a mic behind you. Mate.

I actually haven't heard that speculation.

No, I haven't either. Of course, of course. So I probably can't add anything to it. PGF is going really well. We raised $151 million for it off the back of its strong performance back in August. RF1 is going well. We raised $95 million for it last week. I think if we continue to perform for VG1 and RG8 and close that gap, which we've made significant inroads in, there's a prospect of possibly being able to raise capital for both vehicles possibly next year.

Simon?

Look, the buyback is accretive to those of us who don't sell. I'm just wondering just back of the envelope numbers that I've done here, let's say you bought 60 million shares in this buyback, which finishes today at $0.25 less than NTA. That equals $15 million of profit or gain, if you like, in NTA for the rest of us, almost 2%. Where does that fit? Who's claiming the benefit of that fund? Is that included in the fund managers' performance or -- where does that show up?

Yes. It shows up in the NTA of the business. If we're able to buy things at a discount, that is a gain for the portfolio. It's just the same as buying a share that goes up or selling a share that goes down. It is a gain. We have these assets, and we have the number of shares. And if we're able to buy assets at a discount, that happened to be our own portfolio, that's accretive to all of us. So we all get pari passu, if it's a 15% discount or whatever it was, 10% and now 5%, we get that benefit. So it just falls to us.

Yes. No, I get that, but where does this show up in the numbers? As you reported, the fund manager has done 15% or whatever the numbers were, TSR is 28% or whatever. I mean, you can't -- the fund manager can't claim the benefit for doing that. So where does that number -- where does it show up?

It shows up in the second one. It shows up in the TSR. It isn't in the portfolio. Brendan, do you want to add something?

Yes. I think the simplest thing, the accretion that's created is spread evenly across all unitholders. So every shareholder benefits from that. So by definition, it's in the NTA. There are less shares on issue for a given price.

It's just -- who's claiming the -- I don't want the fund manager to think, oh, I did that because you didn't.

I think the simplest answer is the benefit is shared across all unitholders and shareholders.

So I would think of it, it shows up in the second number. It doesn't show up in the 19, it shows up in the 28. And pleasingly, my CFO is nodding at me, which is always a good thing. Right. Is there anything else? Okay. The final bit and thank you for an efficient meeting. That concludes our general questions. In case you have not completed your voting during the meeting, I will now give you a few minutes -- moments excuse me, to finalize your voting. As mentioned earlier, Boardroom, VG1's share registry will conduct the poll using the voting cards that you lodge in the room, the online votes that you submit today and votes that were cast online before the meeting. If there is any person in the room who believes they are entitled to vote, but is not registered to vote, if you could please raise your hand for assistance. As a reminder, for those in the room, the persons entitled to vote on this poll are all shareholders and proxy holders who hold blue voting cards. On the reverse of your blue admission card is your voting paper and instructions. Please print your name where indicated and sign the voting paper. When you have finished filling in your voting card, please give it to the boardroom reps to ensure your votes are counted. The Boardroom staff will also be able to help you if you need additional time or other assistance. If you do require any help, please raise your hand. Have all the votes been cast. I'll now declare the poll closed and formally charge Boardroom to count the votes. The results of today's AGM were released to the market and made available on VG1's website later today. So ladies and gentlemen, as there is no formal business of the meeting, I'll declare the AGM of VGI Partners Global Investments Limited closed. There's the boardroom guy, if you want to put your blue things in. I would like to thank everyone for attending today's meeting. And by all means, reach out at any time to our Investor Relations team if you would like further information or questions about our company. So that's it. I'll declare the meeting closed. Thank you.