WAM Capital Limited (WAM.XA) Earnings Call Transcript & Summary

Good morning. I'd like to welcome and thank everyone for joining us today for the WAM Capital, WAM Microcap, WAM Research and WAM Active Full Year 2025 Results Webinar. My name is Tevi Yao, and I'm the Portfolio Manager across the 4 funds we manage. And with me today is Shaun Weick, Deputy Portfolio Manager. And Emiko Reed is also on the call. She will be moderating the question-and-answer session. Now before we begin, a disclaimer is displayed for you. And as a reminder that what we discuss today is general in nature and should not be construed as financial advice. We also want to express our gratitude for the support of all of our shareholders. We are all investors in the LICs ourselves, and thank you for allowing us the opportunity to manage your capital. As Geoff always says, these are your companies, and we love to get the questions from you. So feel free to send through your questions for the Q&A session. Now in terms of how the call will run today, I'll give an update on the 2025 financial year and how our current views on the market. I will then hand it over to Shaun, who will discuss the recent reporting season and how we've positioned the fund, and we'll both provide 2 stock picks before moving on to the Q&A session. Now I think the last 12 months has been extremely volatile. And when we had the webinar 6 months ago, we're right in the thick of things. But the Trump's Liberation Day and the tariff war induced significant dislocations in the equity market. This was further exacerbated by the various geopolitical tensions. And so the market was actually very volatile. As we've seen with previous market uncertainty and turmoils, the team rallied together. We focused on what we can control. And more importantly, we focused on sticking to our investment process. And for those of you that's been with us for -- along the journey, the investment process hasn't changed since when Geoff first started the business close to 30 years ago, and that is to find and invest in undervalued growth companies with catalysts that could rerate the share price over time. So luckily, the team has done a good job in acting decisively and then playing offense and using the market volatility as an opportunity to replenish our portfolio with high-quality companies with catalysts that could hold -- that we are holding that we think will get paid over the next 1, 2 and 3 years. Now with that said, let's look at the 2025 full year results. I'm pleased to report that all funds outperformed their benchmarks in 2025. WAM Capital and WAM Research outperformed the Small Ordinaries Index by 9% and 9.2%, respectively, in 2025. WAM Capital and WAM Research also outperformed the Small Ordinaries Index by 9.9% and 10.1%, respectively. WAM Microcap outperformed the Small Ords Index by 6.5%. And we were very pleased with the performance of WAM Active, the investment portfolio returned 26.4% for the financial year. Now on the next slide, you can see the dividends announced for each of the funds and the current yield based on the share price as at yesterday. Given the companies which we invest in, our performance against the Small Ords Index is probably more representative of the stock selection process, given 50% of the All Ords Index is in banks and resources, which is outside of our investable universe, given it doesn't really fit with our investment process. And we've spoken about the underperformance of small-cap companies over the last 4 years versus the broader market. So far this year, luckily, we've seen a reversal of this trend. So the Small Ords Index is up about 5% relative to the broader market. And as we've spoken about this in the past, one of the reasons is the reduction in interest rates in Australia. And so we are quite positive on the next 12 months for small-cap investing. And now I'd like to pass it on to Shaun Weick to provide a summary of the reporting season and also how we positioned the fund.

Great. Thanks, Tobias. Thank you all for joining us today. I'm obviously pleased to share our insights from the recent reporting season, outline some key market themes and discuss our portfolio strategy to capitalize on the emerging opportunities in the Australian equity market with a particular focus on our expectations for a period of small cap outperformance. So in terms of the reporting season we just had, the ASX Industrials delivered robust performance this reporting season. We saw around 11% net earnings beat with resilience of margins, the key feature. Small-cap companies were the standout. They posted a solid 21% net earnings beat ratio, driving share price gains that outpaced their large-cap peers. And as Tobias mentioned, this has been a reversal of the trend we have observed over the past 4 years. Why is this happening? Well, it's RBA rate cuts, and we think an improving economic outlook, which is supporting the early stages of a rotation into small caps. We've observed increased investor attendance at group presentations throughout reporting season, which is consistent with broker feedback suggesting renewed interest in what are more economically sensitive smaller companies, which is a dynamic that's consistent with this stage of the economic cycle. However, the period was not without its challenges. One particular thing I'd call out was the share price volatility. This reached truly extreme levels at times, among the highest in recent memory, which we'd attribute to the rising influence of systematic investing and also passive strategies. This volatility, while challenging, does present very compelling trading opportunities, in particular for the WAM Active strategy. A prime example of this was Megaport, which saw its share price drop around 20% at the open due to perceptions of an earnings downgrade with aggressive reinvestment flagged for the FY '26 outlook. Our analysis, I suppose, supported a contrarian view to this. We believe a sustained reacceleration in revenue growth is really what aligns with, I guess, investor priorities. And given management's proven ability to deliver operating leverage in the past, this conviction was validated as the stock rallied over 20% during the earnings call and really reflects growing confidence in CEO, Michael Red's strategic vision for the business. So I suppose digging in a bit deeper now into some of the market themes that I would highlight from the reporting period. I mean it's very clear to us now that falling interest rates are driving positive momentum across the Australian economy, particularly in the consumer discretionary sectors with CEOs much more optimistic in the conversations we had versus 12 to 18 months ago. Our portfolio maintains an overweight position in this space. We've got holdings such as AP Eagers, Harvey Norman, which reported 8.5% like-for-like growth in current trading and Nick Scali, which was up about 7%. So you're clearly seeing strong momentum flow through from these initial rate cuts we've had so far, which really does reflect their sensitivity to this interest rate dynamic. The housing sector, broad-based, is also benefiting. Companies like mortgage aggregator AFG reported very robust lodgement activity. Land lease communities operators like GemLife, they exceeded their prospectus forecasts and peers such as Ingenia and Aspen Group delivered earnings upgrades driven by higher home settlements. Within the construction materials space, Mars Group's optimistic outlook positions it as a rare pure-play beneficiary of the broad-based spend we're seeing in infrastructure and the resi market. And amid geopolitical uncertainties, tariff-related risks, we have maintained a bit of a strategic tilt towards domestically focused companies. The mining services sector recorded what I think was the strongest reporting period in a decade. Companies like Monadelphous, SRG Global, NRW Holdings and Tasmia Group posting significant share price gains. Robust commodity prices. Gold is obviously at record highs, iron ore is hanging very strongly, tight labor markets and a strong capital expenditure outlook are seeing negotiating power much more evenly balanced, and this is paving the way, we believe, for continued margin expansion in the sector. Within the tech space, obviously, we think results were probably more mixed there, but we're encouraged by, I suppose, the exceptional performance of some of our key holdings, the likes of Life360 and Energy One, which posted really strong results and maintain attractive growth outlooks. Global optimism around artificial intelligence continues to drive elevated capital expenditure expectations. This morning, we've just seen Oracle come out with some huge upgrades. The stock is up 27% after market. And from a domestic point of view, exposure to this trend does remain relatively limited in terms of the way to play it. We think Megaport is the highest quality capital-light play in this space, and it's very well positioned to capitalize on this AI-driven infrastructure demand. So I guess moving on to the outlook. Looking ahead, I mean, equity markets have staged a strong recovery post Liberation Day, but we remain constructive on the outlook, particularly for domestic small cuts, which we believe are in the early stages of sustained outperformance. We've got improving economic indicators such as rising house prices, increasing consumer spending and positive business surveys reinforcing our optimism for the Australian market. And global risks, there clearly are some tariffs, geopolitical instability, some bond market volatility. We're always mindful of what's happening on the global front. But our base case anticipates continued global monetary easing, which should help sustain cyclical momentum, we believe. And on top of that, you've got the ongoing AI-driven capital expenditure boom, which is bolstering global equity investor confidence, we think, into year-end. So portfolio positioning, we think the portfolios are really well positioned to capture the upside from this improving domestic economic cycle. Cash levels are at approximately 12% at the moment. So we're retaining ample flexibility to seize on emerging opportunities. Really pleasing to see that deal activity has accelerated in recent weeks with companies raising capital to fund growth initiatives, including earnings accretive acquisitions. A notable example within our portfolio is Tobias' favorite stock Tuas, which executed a transformative acquisition in the Singaporean telco market. The IPO market is also showing signs of revitalization. We've had successful listings of GemLife, Virgin as well, which -- and from our conversations with ECM teams, there's a robust pipeline of future deals. So this environment supports our overweight exposure to small caps, which we believe are well positioned to benefit from ongoing cyclical tailwinds. And from a -- just looking at the next slide here, from a valuation standpoint, I mean, small caps still remain attractive relative to large cap peers and are supported by stronger earnings momentum in our view. We're maintaining a disciplined approach, focus is high-quality companies with strong fundamentals. And overall, yes, we're confident in our ability to continue to deliver superior returns for our investors.

Stock picks?

Yes, stock picks. So I'll go first. So yes, I guess my first pick is Tasmia. It's a founder-led provider of specialized maintenance services to the mining, resources and industrial sectors. It's far from being a mere acquisitive roll-up in our view. The company is achieving organic growth north of 20% at the moment. And its differentiation really lies in our strategy of identifying, incentivizing dynamic young entrepreneurs that are hungry, giving them equity to drive strong growth in their businesses and allow them to scale up. We think the stock is very catalyst-rich. It's got, in our view, prospects of earnings upgrades, further accretive M&A post the recent $30 million equity raise, which puts them in a great position. And we think they're well placed at the moment for index inclusion within the ASX 300 in March 2026, which you probably hear a lot of people talk about the importance of index inclusions these days. And then my second pick is Zip. It's the leading buy now, pay later provider in Australia and the United States. Cynthia is doing a great job turning that business around, and we believe it was one of the standout results of the reporting season. The FY '26 guidance points to accelerating growth in the key U.S. market. The stock remains under owned by institutional investors here domestically. And we think there's significant upside in terms of earnings growth and also valuation re-rate catalysts, including potential Nasdaq listing next year. And obviously peer Klarna is looking to list very shortly, and it's going to list above the top end of the guided range and is about 8x oversubscribed from what I've been reading this morning. So yes, those are my 2. I'll pass it over Tobias for his 2 stock picks.

Thanks, Shaun. And Shaun mentioned this earlier, the first stock pick. Now I wanted to talk about this. I think we've spoken about this in the past a few times is Tuas Limited, which is the Singaporean telco. The reason I wanted to mention this today is around 3 weeks -- 3 or 4 weeks ago, they entered into a transformational acquisition of M1 Telecommunication, which is the third largest player in Singapore. Tuas is the fourth largest player. And so that's going to consolidate the market over there to -- back to a 3-player market. We believe it's a step change in the growth trajectory of this business, and it's on the back of flawless execution by the founder, David Teoh and the CEO, Richard Tan. And so we believe the acquisition itself, while it's going to yield a lot of synergy benefits, what the market perhaps is missing is the longer-term market share opportunity for Tuas and the platform that is now being created to not only execute on the opportunity within Singapore, but potentially outside of Singapore as well. So Tuas continues to be a core and large holding in our funds. The other stock, which I wanted to touch on today is a company called Energy One. We are a substantial shareholder in Energy One, and we've only started been buying it about 12 months ago. The business provides software, trading and compliance software for energy electricity trading in Australia and in Europe and is a beneficiary of the amount of renewable energy product contracts or assets coming online. Effectively, if you are a renewable project, you need to sell electricity into the grid and their software facilitates that as well. So they do that both in Australia and in Europe. They talked to the market about and guided to the market to about 15% top line growth, plus they've had a really good start to 2026. And they're actually very profitable software business. We quite like the management and the Board as well. And while we've only been recent in the story, we've done quite a few industry meetings with customers and advisers and are very positive on the stock. We think over time, the catalyst for the stock would be continuing to beat earnings expectations and revenue expectations and it's a high-quality software business. And before I finish up, I just wanted to also say that we've had a pleasing and positive start to the first 2 months of the financial year 2026 and particularly WAM Active, which on our estimates is up 18%, I think, 0.1% over those 2 months. So we're really looking forward to obviously working hard to deliver continued performance for our shareholders. I would like to now hand it over to Emiko, who will go through any questions.

Thank you so much, Tobias and Shaun. We've received quite a few questions from our shareholders. We'll start with [ Meddie's ] question. What is your highest conviction investment across all the funds?

For me, the next 12 months would be Tuas Limited, TUA, which is the Singaporean telecommunication company. That would be one -- that will be my one.

Yes. I'm going to run with one that I chose too, Tasmia. I think this business looks incredibly well placed. As we spoke about the tailwinds that you're seeing across the various commodity markets, it positions them really well. Management own 50% of the stock. They're very heavily incentivized. We're all running in the same direction. Balance sheet is in excellent shape, sorry. We think they'll do some accretive M&A near term. And then, as I said before, stocks under institutionally, and we'll be in the -- we think, in the ASX 300 in March. So yes, we really like to look at that one.

Great. Thanks so much, both. So the next question is from [ Maro. ] He says, with markets at all-time highs and unsustainable multiples, how is the portfolio being positioned and risk protection downside risk?

Yes. So from our perspective, I think there are 2 elements, the cash level. So we've had a good reporting season and took the opportunity to increase our cash level by taking profit in some of the winners. So our cash is pretty high. And I think the other point is the market is -- has had a very good run. However, the small-cap companies have underperformed quite a bit over the last 4.5 years. And so from our perspective, the valuation for many of these businesses, I mean, we've seen things trading on 10, 11x price to earnings ratios that has very good growth prospects. So we think the valuation in the small cap space, it's a lot more reasonable, and we're seeing a lot of opportunities in that space.

Great. So with the next one, we've had a question from Michael, Lucio, [ Eril ] and a few others ask about franking. When will we have 100% franking in WAM Capital and WAM Research?

Thanks for the question. I'll try my best to provide some context. So I'm not on a Board, but it's -- the franking and the dividend policy, it's a Board decision. For those of you on the call, also WAM Capital and WAM Research is -- they're currently paying partially franked dividends, about 60%. And in the annual report, I think there was comments around that for 2026, if we are able to sort of maintain the same dividend as last year, we'll continue to be partially franked. And so the franking credit balance is quite important in determining I guess, and having sufficient certainty on the outlook is quite important to determining the franking percentage. The funds, we've had a really good performance and good progress on rebuilding the franking credits. But to lift it to 100%, I think the Board needs to have more confidence on the outlook. I think the last thing they would want to do is to increase it to 100% and then having to decrease it because we haven't had enough franking balance. And for some of our new investors, just as a reminder, to pay fully franked dividends, we need to effectively sell shares in companies we made money in and effectively pay the tax and therefore, be able to pass that franking credits back to our shareholders. It's a little bit different to the profit reserve, which is for both unrealized and realized gains. And so currently, WAM Capital and WAM Research, they are partially franked. And the LICs, we've consistently paid a very high level of dividends even during the COVID periods. And they benefited the shareholders then, but also it sort of aid into the franking balance.

Great. Thanks so much, Tobias. This next one is from [ Elsan. ] She says, why has the dividend not increased since 2018? Will WAM Capital increase its dividend given the profits reserve of $0.272 at the end of August?

Thanks for the question. Again, it's a question for the Board. But to provide some context, we think the 4 LICs right now are paying pretty good yield like in terms of fully grossed up dividend yields. It's about 11%, 9% and 10% across the 4 LICs, and we didn't want to further erode the capital return. Obviously, the more we pay out the dividends, the capital return declines. We're very happy with how the investment portfolio performance over the last 12 months. But to effectively maintain the current dividend, we need to deliver pre-fees about 15% return every year. So that's going to be the key for us to be able to maintain the current levels of dividend. We're working very hard to achieve the best performance we can as shareholders of the LICs in the LICs ourselves. But from the Board's perspective, I guess, maintaining the dividend levels is a prudent approach in the current market. And I don't think the -- I think it's probably highly unlikely that WAM Capital dividend will increase at this stage.

Great. Thanks so much. We've had a number of stock pick questions come through. Could you please give us your buy, hold, sell calls? We'll start with the first one, XRF Scientific, which is XRF in ticker.

Yes. I'd say XRF is a hold at this stage. The key thing we're looking for there is basically a return to improved top line growth. Clearly, the cyclical dynamics are very favorable. One of our largest positions is ALS Limited, which is obviously benefiting from a significant uplift in capital raising activity in -- across the commodities complex. So we do like the space. There are strong tailwinds. But at this stage, we just want to get more conviction and confidence that we can see that top line generate stronger growth, and that's what ultimately will drive the valuation re-rating in that one.

Great. And what about Fleet Partners Group?

Fleet Partners Group is not one we are in at the moment. So I would say it's probably a hold at this stage. The one we do like in that space actually is COG Financial. Paul -- Tony Dwyer (sic) [ Tony Robinson, ] sorry, from PSC Insurance has actually gone across there and made a pretty substantial personal investment in the business. And one of their key verticals is obviously within that fleet management type space. Yes. So at this point, we think that one has a much stronger runway in terms of its ability to undertake M&A to grow the business, but also expand organically across the panels. It trades on a 13x P. We think they can grow the business organically 15% to 20% a year over the next few years and then layer in some acquisitions. So yes, COG is the one that we're looking to play in that space.

Great. Next one is Qualitas Real Estate Income Fund.

We don't have a holding in QRI, but we do have a holding in Qualitas, QAL, the fund manager. So they -- the reason we have an investment in QAL is due to they're the largest, and I think the most conservative manager out there in private credit. Obviously, there's a lot of money flowing into private credit. A lot of the larger institutional or pension funds around the world that's looking to invest in Australia, they need to invest in effectively the private credit fund manager that has a lot of scale. They've been able to deliver 20% growth. And we think with the seismic shift in private credit and the opportunities they're seeing coming down the pipeline and the mandates they have in the background, it's quite an attractive growing fund manager that's in a space that's very attractive. And the [ fund ] owns a significant amount of equity in the business as well and has been running it very conservatively.

And yes, the feedback we receive across the industry is very positive in terms of Qualitas' risk management framework, which is obviously critical in running a real estate credit fund. So yes, we think they're well placed and QRI does look like an attractive vehicle to us.

What about Judo Bank?

Yes, Judo is a buy for us. The stock is trading at a discount to book value. There's been a few, I guess, concerns more recently around competition in the market and is that creating elevated runoff in their book and pressure on front book margins. But we think it's being overstated. They've shown very strong gross lending momentum throughout June and July. Front book margins are remaining strong. They're only 4% market share at the moment. So there's still ample runway for growth for these guys. They've issued guidance for over 50% profit growth in FY '26. So we're really only just starting to see the operating leverage come through this business. We think if they can achieve the at-scale metrics in that FY '27, FY '28 type pipeline, we think this stock doubles from here. So yes, we like that one.

And what's your thoughts on MA Financial?

Yes. MAF's a hold for us at the moment, purely just on valuation grounds. It's now trading on sort of 23x earnings. Look, we think there probably is risk of further earnings upgrades there. So it can probably continue going. It's a procyclical business in the sense that it's obviously going to benefit from improved capital markets activity. They've done a great job in terms of the MA Money product. We've got exposure, I suppose, to that boom in mortgage demand that we expect to see through AFG. And then they've built a strong private credit business. So yes, if it wasn't for the valuation, I'd be more positive. But yes, we like them and they're a good management team.

Great. So 4DMedical, is it a buy, hold or sell?

It's gone up a lot. I'd probably say it's a hold leaning towards the sell here just purely because I feel like there's a lot of retail speculation built into this one. And then it's traversing through to commercialization is generally the more difficult part with these types of businesses. Artrya Health, stock code AYA is one that we actually really like. It's in a similar space. It's effectively got a software -- AI-based software product that's being used effectively within CT scans to identify plaque being the most recent approval they've just received about 3 or 4 weeks ago and then also an approval upcoming in 1Q calendar year '26 around effectively flow of blood through the heart. They just raised $75 million. They're extremely well capitalized now. We think they've got a strong pipeline of hospitals that they'll be able to sign up over the coming months, and we think that's going to drive a further re-rating that share price, only $250 million market cap, whereas 4DX, I think, hit almost $1 billion. And we think this one has got a stronger TAM and stronger product. So yes, AYA is where we -- one we like in that space.

And last one for buy, hold, sell, Southern Cross Gold.

Southern Cross Gold is probably a buy for us. Yes, I mean the deposit that they recently came out with obviously has the potential to be massive, I suppose. So it feels like you still got good catalysts and good news flow there in the near term. Obviously, the gold price environment is very supportive. So yes, I think that one is still buy here.

Great. So this next question is from Michael. He says, why did you sell MAIA? You had high expectations for the company.

Yes. So we reduced our holding in MAIA. We are still shareholders in MAIA and we have quite a bit of MAIA. As with the fund, we need to balance short-term and sort of medium-term catalysts. We obviously really like the management and the Board and MAIA, and we think they're going to deliver on some of the targets they've set out. I think from our perspective, it is from a portfolio standpoint, is to weigh up some of the shorter-term opportunities in the market and effectively trying to maximize the performance for our shareholders and optimize performance for our shareholders. So while we've reduced the position, we are still shareholders in MAIA and still backing management.

Great. This next question is from Ashok. He says, will the small caps outperform the ASX 100 during this lower interest rate cycle?

Yes. I mean, if historical precedent takes place, then we're very strong believers that, that will be the case. And as we touched on earlier, we've seen that over the past probably 2 months, and we think with the prospect of further rate cuts, then small caps are really well positioned. The interesting thing that came out this reporting season was some very, very savage moves among the highly rated, highly regarded large-cap companies, CSL, James Hardie, Woolworths. I mean Woolworths is still on 35x PE with 1% earnings growth. I'd much rather buy a small cap retailer like Amara or something that's on 10, 11x PE with the prospect of double-digit type earnings growth. So yes, we think we are in the early stages of a rotation towards small caps, and we do believe they will outperform the ASX100.

Great. So this one is from Krish. What is the target for the companies? Capital growth, distributions or both?

This is for the companies we invest in?

Yes, I believe so.

Yes. Look, for us, the key is catalysts. So just to provide a bit of background on that. In terms of catalysts, we're trying to figure out what are the things that could move the share price over the medium to the longer term and sort of identifying these catalysts. And typically, it could be a potential earnings accretive acquisition or an earnings upgrade, and it's part of the process that we undertake to look for ideas and do the on-the-ground work. So the catalyst needs to effectively change the trajectory of the share price that we think. And so for us, that's the key of how we've always invested and that's sort of how we -- that's how we invest.

Great. This one is from Joseph. Did WAM Capital subscribe to the Tuas offer a few weeks ago?

Yes.

We took every share we could get.

Great. So this one is from Hung and it's for Tobias and on Tuas. What are your thoughts about Simba-M1 merger being blocked by the Singapore ACCC? Do you expect the company to enter nearby markets in the medium term? And are there any regulatory issues you foresee in the medium term?

It's a really, really great question. Look, I think the -- this is sort of our view, obviously. The regulatory environment and the setup is a bit different in Singapore in terms of -- it's -- from our perspective, I don't think it's a surprise to the regulators or the IMDA over there of the merger. It's the third and fourth player getting together. So that's the one probably the easiest to get through versus if it's #2 and #4 or #3 and #2, it's going to be probably even be harder. So we think the regulatory risk -- while there's always regulatory risk, it's not very high. It's not something we're really focused on. And I think over time, David and Richard has proven to be very opportunistic and then to have a very focused team that goes after opportunities. One of the things, for example, that I think perhaps the market overlooked over the last 12 months is the amount of value. Simba has added to their plans while holding the price points the same. And so they are clearly working very hard in the background to be able to drive that customer value proposition, which drives market share gains. And so for us, it's -- couldn't be in better hands having David and Richard running the show in Singapore. And I think if there are opportunities over time, I'm sure they'll be looking at it and they're way smarter than we are.

Great. So Joseph and Deep have asked about capital raising. Would any of the WAM LICs you manage consider a share purchase plan?

I think that's again for [Technical Difficulty] on the capital raisings.

Great. Thanks. Sorry. You cut out a little bit.

I was saying it will be a decision for the Board.

Great. Thanks very much, Tobias. So this one is from George. Is HealthCo oversold? And do you have a position in any of the HMC capital investment vehicles?

Yes. So HMC was a stock that we did that HMC Capital HealthCo was a stock we actually did really well on, in particular, sort of coming out of obviously, the 2022 sort of weakness. I think we made over 100% on the stock actually. I mean, as we see it today, yes, the HMC HealthCo itself obviously has a few challenges, and they're directly sort of attributed to various issues are happening in the underlying satellites. We're not holding any positions across -- in HMC or across the underlying satellites at the moment. The HealthCo HCW, which you specifically asked about, it's just been deleted from the ASX 300 Index. So I suspect there's going to be some selling pressure on that one in the short term. Look, it's sort of 30 -- I think it's over 30%, almost a 40% discount to NTA now. The last result only had sort of minor reductions in the underlying NTA. So I think you just need to get some clarity on Healthscope and the broader dynamics there around what kind of funding model that's going to go down before you can gain sort of a higher level of confidence. But yes, optically cheap, but still quite a bit to work through, I think.

Great. This question from Sydney has asked about resource stocks held in WAM Active. What is unique about Greatland Resources and Larvotto Resources?

Yes. So I guess the key thing I'd say is the turnover in WAM Active, which is the fund that I manage is extremely high. Greatland Gold was really a trade, I suppose, around -- it got absolutely smashed off the back of what was a very disappointing update for FY '26 particularly in the context of the company IPO-ing or doing an IPO in Australia only a couple of months before. We no longer -- we're just playing a bounce straight. We no longer hold the stock. We think it's got a decent time and management have to really rebuild some credibility with the market. Larvotto, I guess, again to not a large position within the fund. Really, that's being -- that trade was placed, sorry, around, I suppose, expectations of potential news flow for gold intercept. And obviously, they're restarting the Hillgrove Antimony Mine. There will be 7% of global supply when that ramps up in the first quarter of next year. And on a price NPV basis, like it's about an 8-month payback. So it's one of the cheapest mining stocks on the ASX. So yes, we're still holding that one and still positive on the outlook.

Great. Thanks so much, Shaun. This one is from Phil. What steps will WAM Capital take to rebuild its profits reserves, noting the profits reserve for WAM Capital is $0.272 at the end of August?

Thanks, Phil. Yes, so in terms of the steps, it's just for us to continue to invest in companies that go up or to generate positive portfolio performance for all the LICs, and that's the key driver of increasing the profit reserves. I think I mentioned this earlier, we need to hold the dividend -- the levels of dividend. We need to probably deliver around pre-fees 15% returns, say, for WAM Capital. And so that's sort of some of the rough numbers around what we need to do to deliver the performance to drive the profit reserves.

Great. This one is again from Ashok. He says, how has WAM Microcap been performing this financial year? And what is driving it?

Yes. WAM Microcap has had a positive start to this financial year. Shaun talked about this a bit earlier in terms of over the last 4 years due to the outperformance of, I guess, some of the larger companies, there is a lack of interest in the microcap space, where due to liquidity and the fact that they're not in any indices, doesn't benefit from the capital flow that comes from passive money or the super funds, et cetera. And so with the recent rebound early days in small-cap companies, we believe if this continues, we're going to see more opportunities and more microcap companies outperform. The way the microcap companies have outperformed have historically concentrated on a few large positions that's done really well over a long period of time. And one of the advantages that we have across the LICs, I think it's quite unique to us is the fact that it's the same investment team that manage the WAM Microcap fund as well as the WAM Capital Fund. And often a lot of our best ideas within WAM Capital often comes from the WAM Microcap fund itself. So we are pretty positive on the microcap space given the, I guess, early days we're seeing turning the performance of some of the microcap companies.

Yes. And the only other point I'd add to, like, in terms of the relative performance of the XSI over the last month or so, the Small Resources Index was up 15% in August. That's a massive headwind in order for us to overcome as pure industrial stock pickers. We own -- we obviously own no gold and no commodity stocks within the microcap fund. So yes, that's just the other point to note is the construction of the index, it's very gold heavy, and we don't have exposure to that area.

Great. This next question is from Eric. Are there any significant detractors in the WAM portfolio? And what is the plan for those?

Yes, plenty of detractors. So reporting season. And I think also the other thing is in a positive market, a lot of the -- I guess, it's opportunity cost or investing in businesses that share price that doesn't go up and doesn't go up with the market. But in terms of mistakes during the reporting season, we had a position in IPH, patent attorneys company. They effectively downgraded at the result, the share price fell and then we sold out. Another company that downgraded, but we continue to like is a company called Events Hospitality. So they run the cinemas and they have a fast-growing hotel business and have a lot of assets. So that for Events Hospitality, we were able to take profit into the results. So our position size was reduced. The number...

The share price has gone up about 40% over May to sort of the end of July. So yes, we had taken -- we'd almost halved the position on the way in. And then yes, as Tobias mentioned, I mean, we're still positive on it. There's very strong asset backing there. So we've actually been buying back a few shares recently.

And I think that's a testament to the active side of sort of our funds that we can make these decisions.

Great. Thanks so much, both. This one is from Mark. What is your view on Generation Development Group following the Evidentia acquisition?

Yes. We really like GDG. We've been there for 6 years. I think the last few years, the share price has done extremely well. The management team there, Grant Hackett, Rob Coombs, Terence, they've done an amazing job effectively growing the business and obviously making smart acquisitions. So Evidentia, we think a lot of these asset consultants, they effectively are the gatekeepers for capital in Australia. Organically, they've seen very strong flows from both the bond products and also the Evidentia flows. And yes, we're pretty -- it's a growth company, and we think they're very well placed for the next 5 years.

Yes. We think there's some good catalysts coming there near term in terms of the momentum they've got on flow side of things. The pushback on Evidentia has been, I suppose that some of the flows have sort of pushed to the right, but management are adamant that ultimately, they're maintaining what they've guided to into this year in terms from a profitability standpoint because in classic sort of Grant Hackett, Terence fashion, the CEO and CFO, you always leave a bit up your sleeve and a few hedges. And yes, we think they've got plenty of levers they can pull to continue to grow that business very strongly. And one of the interesting points we picked up with them when we caught up with them the reporting season was the opportunity in investment bonds directly with super funds. That's a new space. Clearly, Div 296 is potentially a driver of that. So yes, there could be some very significant flows coming there. So watch this space, I guess.

Okay. Thanks so much. The next one is from George. Is Qoria or QOR the next Life360?

Great question. Look, we're very bullish on both, to be honest. Yes, we were early in 360. We've owned that stock from $4. It's been probably one of the best performance within the WAM Capital Fund over the past 5 years. Qoria is now held across both, again, to Tobias' point earlier where we -- within WAM Microcap, we can have an early look at things get really across these. We're buying that stock at $0.30, $0.25, $0.30. And now we've got it in WAM Capital and buying it. We think it's passed through the free cash flow inflection point this year. It's growing its ARR very strongly. There's still a long runway for growth for the business to go. The structural tailwinds in terms of the funding environment improving in the U.S. And we do think they're well positioned to, I guess, undertake bolt-on M&A. The September quarter is typically the big quarter in terms of cash generation. So we think there's a good catalyst coming there near term as well. So yes, that is one we like. And going to the point of index inclusions has recently gone into the ASX 300 as of the announcement on Friday.

The next one is from Sohan. How do you factor Australia's declining productivity into your investment outlook?

It's a great question. I think -- feel free to add. But I think a lot of the companies we invest in, we focus on pricing power. So companies where the product is very strong. The customer proposition is very strong, there's product market fit. And so when these businesses with pricing power, as they grow, we feel like any changes in perhaps overall productivity could be somewhat mitigated by the pricing power of these businesses to ensure the margins are stable. A lot of the small cap companies, I think those that's really embracing AI and particularly the tech companies that's been very on the front foot will -- should actually see an increase in productivity for the -- like that's the feedback we've had from many businesses like, say, Temple & Webster as an example. So that should actually lead to a change in productivity for us. So it's really -- because the small cap space is so diversified, it's really different industries and companies that have different productivity challenges.

Yes. I think it's more a function of larger businesses where there's -- there tends to be quite a lot more bureaucracy and whatnot in terms of how to manage cost base. It's probably less of a factor, particularly across the more nimble, high-growth businesses where everyone is running in the same direction.

Great. Thanks so much. So this next question is from Claire from IRR, the research house. She has asked, where is Oscar? Great question.

Well, thank you for the question. Yes. So recently, Oscar has been on leave, but he has been working remotely. I think I've spoken to him every single day or Shaun and I have for the last month.

More than my wife.

And which is running joke internally, but he'll be physically back in the office with the team at the beginning of October. And obviously, we sort of chat all the time. In the small and mid-cap team, obviously, Oscar has joined -- we've been working with Oscar since 2016. I think Shaun joined in 2019, Sam in 2018. And we have Cooper and Chris, who's been with us -- Cooper since 2017. And so we have a pretty experienced team and a pretty good platform to continue running the portfolio here.

And Oscar, he's never had more than a wake off, I don't think, in 10 years. So I'm actually looking forward to seeing him come back, refresh, reinvigorated. And we think he'll be on fire from day 1.

We've Already started to book in his meetings effectively.

Yes, he's got a heavy travel schedule coming.

Work related.

Thanks very much. This next question is from David. What expectations for IPOs do you have in the coming year? Quantity, size and sectors to watch out for.

Yes. I mean I'd say, as a general standpoint, ECM pipelines are starting to refill for IPOs. I think at this point, they're generally going to be, I'd say, more towards the $300 million to $500 million type market cap range. We're seeing pretty diverse range of companies. Anything from the tech space, general industrials, there's a few things in health care poking around as well. And then I mean, I think the larger ones that are probably on the horizon are things like Estia Healthcare that -- which was a very good investment for us and taken private a few years ago. Given how well the aged care space has performed, there's obviously potential for that one to come back. And I'd say just as a general rule. We read a lot about the assets that are sitting within private equity and the fact that a lot of these assets are, I guess, reaching the end of their fund lives, and they're going to have to try and find an exit somehow. So yes, it will be fascinating to see sort of the next couple of years what comes out of some of these private markets and whether the public market will actually have appetite for them or not because there's a lot of pass the parcel happening in private markets at the moment.

Great. thanks so much. I think we'll have to do another round of buy, hold, sell. The first one is EVT. I do know you touched on it earlier, but maybe just a quick note on that one.

Buy for us.

Great. Objective Corporation.

It's a hold for us. We do like the business. They have pretty good growth. I think it's just more in the fund, We have some of the other tech businesses with higher growth that we've have invested in heavily.

Yes. Tony has done an amazing job, founder-led business. I don't know if he's ever sold a share. It's a $2 billion company. Yes, for me, on that one, it's getting more conviction on that IRR outlook, particularly from an organic growth perspective, which has tapered off a little bit in the last few years. And we're obviously holders of TechnologyOne, they do bump up against in certain aspects. And that business has done a phenomenal job, and we remain supporters there, too.

Great. Coast Entertainment Holdings.

Probably a hold to have a very good asset. And it's a function of when they could, I guess, extract the intrinsic value of the asset.

Yes. It's probably just the time line to unlock the value of the land. Like obviously, there's been some press more recently around a large-scale hotel being built there because at the moment, you're just very much beholden to the ebbs and flows of Dreamworld traffic. So yes, it's probably a hold for now with the view to gain more certainty around the catalyst to unlock the value of the land.

And your thoughts on betr Entertainment?

Yes. So betr is a buy for us. Obviously, there's a lot of to and fro happening at the moment in terms of the PointsBet acquisition. That could play out in various ways. They could ultimately be successful in gaining control of PointsBet. There could be a scenario where Mixi engages with them and then they essentially license the tech out into Japan, the sports betting software platform. Or there's a scenario where BlueBet itself rolls into a larger entity with PointsBet and Mixi. We're also not precluding other potential scenarios out there. Obviously, there's been some press around Ladbrokes and what are they going to do. There's been some press out there around days and sports now that, that's changed. Kayo's change ownership towards DAZN and do they want to enter the sports bet market. So yes, in short, the balance sheet is in great shape. We think they've got plenty of optionality. And we think irrespective of anything happening right now, the core business on about 4x EBITDA, and they're about to get -- if they weren't to proceed with sports bet and they just got their cash back, like NAV becomes even cheaper. So yes, in the various scenarios we look at, which are multiple on that one, we think it looks very well positioned to make money from here.

Next is Bisalloy Steel.

Bisalloy Steel isn't one I've actually looked at.

Thanks for the tip. We'll have a look at it after the results.

We can come back directly after we've had a look at it.

Great. Breville Group.

Yes. Breville, we like medium to long term. Obviously, they've been one of the companies that was impacted by tariffs and had to make -- and they were actually very proactive having made decisions to effectively change the manufacturing base. They sell the coffee machines to Australia, the U.S., Europe and now in Asia. We really like the management. They've done an incredible job growing the business, and it's really a market share story. In the short term, there's going to be a little bit of uncertainty around the landed margins and exactly how all the tariff impacts will play out. But from our perspective, from 2027 onwards, they are effectively selling more coffee machines and products, gaining share in all the geographic areas they're in. So definitely want to hold for the long term.

a2 Milk.

a2 Milk is a buy. We had a good position, a decent position into the results. The management team has done an excellent job executing at the most recent results. They also effectively ticked the box that a lot of investors were worried about, which is the supply and manufacturing of the product. They -- David Bortolussi, the CEO, did a back-to-back deal to sell the underperforming asset and actually buy another asset at the same time. And I think it's underappreciated his ability to get that across the line and effectively solve the issue that people have had. In China, the CEO, Li Xiao, has done an amazing job growing share and effectively winning share from the incumbents, other large infant formula brands as well as the local brands and increasing share geographically. Our view on a2 is that over time, they'll go from a wine brand business to effectively multiproducts under the one brand, multi-region. So it's not just China. They've gone into the Saudi Arabia. They've gone into Vietnam, obviously, in the U.S., et cetera, as well. So we think it has a lot of IP, the a2 IP. And so we're strong believers in the business and the ability to continue to win market share.

Great. Next one is Smartpay.

Smartpay is currently under takeover offer, and so fingers crossed.

We're holding on the basis that we think the deal closes.

Yes.

Yes. Great. So -- and your views on EML Payments?

Yes. So that's one which we have a substantial holding in. The reason we are there -- and this business has had quite a journey, a bit of a roller coaster ride. The reason we are there in that size is because of the new Executive Chairman, Anthony Hynes. He's taken over reign the effectively 6 to 8 months ago. Amazing entrepreneur who's proven himself before when he founded a business called eNett and sold it for $4 billion, which is also in the payment space. He's now come into EML. He's bought, I think, $3.5 million of shares on the market. The Board has set the targets of, I think, about -- it's about close to $20 million worth of shares for him if he can get the share price to $1.40, $1.50 within 18 months' time. But underneath the hood, he's making a lot of positive changes to the business and reinvigorating growth and really driving that efficiency really hard. So they actually upgraded in August, so they are clearly green shoots. I think they've set out targets of $95 million of EBITDA in 2028. So that will come very quickly in a blink of an eye, and we're really backing management and Anthony and Peter there to execute.

Great. Thanks so much. This next question is from [ Meddie. ] What happened with Austin Engineering? And what has the -- what was the logic behind the investment originally?

So Austin was originally inherited when we took over the Euroz portfolio. So that's when we originally inherited that position. Post our due diligence, our conversations with management, we knew the CEO, David Singleton from his Austal days and had a good relationship there. I understood the vision and what he was trying to build and did really well, obviously, for us for a period of time. In hindsight, we probably should have sold more stock than we did earlier. And really, the change in management was, I suppose, a catalyst for us to sort of reassess our holding in the business. And then we obviously saw some, I suppose, negative developments around some of their key growth pillars in terms of the margin structure and whatnot at the time. So yes, we've exited the position in WAM Capital, and we're holding a small weight in WAM Microcap.

Great. Thanks so much, Shaun. Phil has asked, would the Board consider slightly cutting the dividend to retain more earnings and profits reserve? And just in addition, Andrew, one of the shareholders joined late and has asked, will WAM Capital return to 100% franking? If you can please touch on that again, too. Thank you.

Yes. So the -- again, the -- it's a question for the Board. But in terms of the context on the dividend side, our goal is to continue to drive positive portfolio performance. That's going to add to the profit reserve and obviously, the ability to pay out dividend. And so that's going to be our -- obviously, the thing we're working really hard on, we're all investors in the LICs ourselves. And so that's the first thing, second and third thing we think about every single day. On the franking side, I touched on this earlier. I think until the Board has comfort around the certainty on the franking balance going forward and the ability to maintain the 100% franked dividend, it's most likely going to be -- continue to be partially franked at around 60%. But the frank -- there's always going to be mismatches in timing. So with the franking balance, it's realized capital gains and versus the proper reserve is both realized and unrealized as well. So obviously, driving positive performance is number one. And hopefully, that eventually leads to the fully franking of the dividend. And the point I touched on earlier was also during the COVID period, we continued to pay a very high dividend -- franked dividend yield, which benefited the shareholders at the time. However, it did deplete the franking balance.

Great. Thanks so much. This next one is again from Ashok. What is your view on Cettire going forward?

Cettire is not a stock we have in the fund right now. They are going through their challenges in terms of the changes to the tariff landscape. And so they're working through that. It's one we've had a small position in the past, but it's -- like all small-cap companies, we'll look at it. We'll assess it when the resource comes out. We'll go through it and if the opportunity is right, we can get back into it.

Great. The next one is from Glenn. Do you have an opinion on the Brickworks-Soul Patts merger?

Yes. We're very positive on the merger. We think it unlocks, obviously, a good level of synergy and strategic benefit. For both sides it's effectively unwinding the previous structure. And so we participated in the initial raise. We participate again in the second tranche raise that they did. And from here, there's a significant wave of passive buying that still needs to occur as a result of, I guess, changes in free float and index up weight. So yes, we remain very positive on that one. Clearly, to us has been one of the bigger holdings, which we've had in good size for a long time now. And yes, we rate Todd and management very highly. We think they're very good stewards of capital. So yes, we're definitely positive on that one and that one in WAM Capital and Active.

Great. Thanks. This next one is from George. Do you invest in companies listed on the New Zealand Stock Exchange?

Yes, we do. We've got a number of holdings that are on the New Zealand Stock Exchange. Summerset Group, which is a retirement village operator, EROAD, a small technology company is also listed there. Smartpay, obviously, a2. We've invested recently in a company Black Pearl Group. It looks like a very exciting technology player in New Zealand that's looking to move their primary listing here, the ASX. And that probably goes to the point. We struggle with the liquidity profile of the New Zealand Stock Exchange in terms of the stocks that we like to invest in. And it just doesn't have the same level of passive tailwind, if you like, that the ASX does. So yes, if we're investing in New Zealand companies, one of my biggest learnings probably the past 12 months is the listing, I had to say to be an ASX primary listing because it just seems to -- the investor universe is very different in the way people approach the companies. But yes, I'd say New Zealand stocks generally, like they probably lagged expectations. The recovery has been pushed out further than what [indiscernible].

So this next question is from Ashok. Do you hold Australian Broadband in your portfolio?

Aussie Broadband is actually one I bought in the active portfolio recently post result, which was obviously a very good update, a beat to FY '25 expectations and guidance for FY '26 also ahead of the market. We think going forward, that's the Challenger broadband space more generally, we've got shares in Superloop as well. Like this isn't a winner takes like all type industry. It's really about these challenger brands taking share from the slow dinosaurs like the Telstra and whatnot with better-performing products, better service, et cetera. And we've obviously got a significant churn event coming up in a few months' time. So yes, we think the challenger broadband players look well positioned here.

Great. Thanks so much. This next question is from Philip. Do you like PEXA Group given its pricing power, makes it almost a monopoly?

Yes. We used to hold PEXA and actually heard good things about it recently in terms of the new management. So definitely want to do the work on. And it is making headway in the U.K. as well. And I think in Australia, the environment has improved as well. So the business model is very attractive to us. And yes, we'll be doing work on it.

This next one is again from Claire from IRR and John, who have both asked, what was the catalyst thesis for IPH Limited?

Yes, was twofold. So IPH have effectively paid in attorneys. So they have operations in Australia, Asia and also in Canada, these were through acquisitions. Over the last few years, they've had effectively either one or more than one part of the 3 weren't working or not kicking goals and had market share losses. And so heading into the results, we were more positive on the organic and the market share positioning for the 3 positions, and we thought that could positively surprise the market, effectively having 3 -- all 3 regions producing positive growth, which would be the first time in quite a long time. And when we look at the margin profiles of the 3 different regions, it's also quite different. So Asia is quite high, and you have Australia and you have Canada. And so our view was the self-help opportunities within the business to obviously get the margins up for the other 2 regions, and that would again be another catalyst because it will lead to earnings upgrades in the outer years. So unfortunately, we didn't see enough -- or the market didn't see enough at the August result for them to believe in the thesis. And so the catalyst didn't play out.

And there's obviously a CFO change there, Brendan York, too, who we had a good experience on with -- in the past with the N group. We always pay very close attention to changes in management and backing good management teams. So yes, there's a bit of a view, I suppose that he would be able to get in there and make some change to the cost base that probably just didn't eventuate to the degree that we thought it would.

Great. Thanks so much. Tobias, Energy One was your stock pick. But Ian asks, given the share price of Energy One and how it has gone up, is there still substantial upside given the current price?

Yes. I mean over the long term, 100%. I think the top line growth really attracts us and the ability for them to continue to participate in what's happening in the renewable space. The market in Europe is growing at 30% plus, and that's the market as a lot of the electricity markets are opening up, and we need effectively software to be able to trade across regions, across countries. Those changes really happened post the Russian-Ukraine conflict. And so I think there are secular structural growth that's happening in the background that's really helping a business like Energy One, and that's really underpinning their top line growth in Australia. Obviously, we've seen with a lot of the charts and GenusPlus is another company which is benefiting from this is the amount of solar projects, wind projects coming online. Each single project needs to be connected to the grid. In the case of Energy One, the software that needs to be used by the different projects is effectively what they produce and the 50% of the electricity traded in Australia. So they really benefit from the market growth here as well. So Australia historically has been growing at about 13%, and Europe has been growing at a higher rate. So we think it's going to go through a period of higher top line growth. They've talked through to operating leverage. So we should see the earnings come through as well. And in the August results, they talked about potentially acquiring, but only acquiring businesses if it's earnings accretive from day 1, and that's quite important. And I think the management and the Board are very conservative. So they have a very good track record there. And we think if they open up another region, as an example, that could increase the total addressable market and the business could be quite large in a few years' time.

And yes, $500 million market cap, we think that really is a sweet spot for these high-growth software tech businesses, like we wouldn't classify this business as well owned or well discovered at all from an institutional investment point of view. So there's still plenty of potential buyers, we think.

Great. Thanks so much. This one is from Andy. What is the team's thoughts on G8 Education following the bad press and price reduction?

Yes. I mean, clearly, it was -- I suppose, press was obviously very disheartening and disappointing to see. And to be honest, we felt most badly for not only those affected, but also the CEO, Pej, who's done an amazing job with that business operationally so far and all the staff. So yes, it was obviously really sad to see for them. Look, I think operationally, the impacts are probably overblown. And there is a significant amount of this now reflected in the share price. We took action immediately and de-risked the size of the position, so we could sort of await further clarity as it sort of played out. So it's no longer a significant holding within the WAM Capital Fund. It hasn't been for obviously a few months. From here, I actually think assuming that the actions or I suppose the government's view around this is to really just install cameras and things like that, like G8 have already got that done. G8 already screened all their employees, pre being employed, et cetera. So we don't think there's actually a lot the business needs to change operationally. And they've already been among the high standard operators out there. So looking into FY '26, cost of living pressures and whatnot have clearly had an impact for FY '25. But I think, look, as we look forward, like the stock is very cheap. And if you believe that interest rate cuts are going to flow through, consumers have more money in their wallet, some of the policies around child care uptake are obviously positive for occupancy. Yes, we actually think it's starting to look quite interesting again now. So stock we're staying close to doing work on because you could see quite an aggressive rebound into '26 if they can close that gap on occupancy and get occupancy improving again.

Great. Thanks so much, Shaun. This next question is from both Ashok and Peter, who have asked, what are your thoughts on DroneShield? Did you hold it in the portfolio before it was added to the ASX 200 Index?

DroneShield, we've done some active trading around it. There was a sell-down at one point by one of the U.S., I guess, peers or competitors of the business that we were looking to potentially partner on some tech. It ultimately didn't go down that way. So we took some -- the stock sort of rallied so -- and then we sort of sold it out. We didn't own it into the ASX 200 inclusion. As an overarching point, I'd say, clearly, there's very strong tailwinds at the moment around defense globally. It's been flagged by NATO nations pushing from 1% to 5% of GDP by 2035. So this is what I'd call a hot sector in the market at the moment and share prices are reflecting quite a bit. But the way that we're sort of playing it, I suppose, that theme at the moment is through Codan. That's done a phenomenal job for us. Their communications business, about 40% of that is leveraged to military spend. And they're only really starting to see the uptick in inquiry now. So we think they are well positioned. We've got some shares in EOS in the active fund. Yes, clearly, some very significant developments there more recently with the high laser, I guess, technology sale. And then also it sounds as though the pipeline there remains extremely full into next year. So yes, the defense theme, is very, very strong in the market at the moment, but valuations are reflecting that. And as we saw about a month ago when -- look, when Trump was trying to, I suppose, offer an olive branch between Russia and Ukraine, those stocks fell 10% to 15% in 1 day, obviously rebounded since. So yes, it's sort of you got to be careful because they are baking in a lot of upside, these defense stocks.

Great. Thanks so much, guys. We have a few more stock pick-related questions that have come through. Could you please give us, again, your buy, hold, sell calls for Dimerix Limited, that's the first company.

DXB, it's not one I'm close to, sorry.

Buy, hold, sell and not applicable probably. Time to come back, we will come back. We're going to do some work on it. It's a biotech business. It's not typically our wheelhouse. Yes.

Next one is Tyro Payments.

Tyro Payments, I would say, we haven't in fun, I would say it's a buy. I think they've had a -- with [indiscernible], there's a change at the top with the CEO leaving, moving on. And so they're looking currently for someone to come in and run the business. But they've had a very good start to 2026. It's a payment business. Obviously, we own Smartpay, which was obviously on the takeover. And we think there are a lot of -- we think there are parties -- I think payments is always a very interesting party for people to look at and for international businesses to get into Australia and having that payment network already there. So I think the intrinsic value is there for Tyro and organically or from a business perspective, they're doing well.

Telix Pharmaceuticals.

Telix is probably a hold for us at the moment. Yes, quite a few moving parts there at the moment in terms of regulatory, I guess, factors. I'd also say, too, clearly, Illuccix their, I guess, key product in the U.S. market. It does look as though competition is starting to increase there. And yes, I guess, more broadly, the market penetration story has played out quite a bit now. So yes, it's probably a hold for us. We have owned in the past, haven't owned it for a little while now. But yes, one that's on our -- is still on our radar.

Next is Electro Optic Systems.

Yes. I sort of touched on this one before, EOS. Yes, I mean, clearly, defense thematic at the moment is incredibly strong, significant tailwinds in terms of increases in government funding coming in the space. Stocks run hard, but I'm going to say it's a high-risk buyer. It just feels like it's got the momentum at the moment. The pipeline is very strong. It feels as though it's got a couple of potential contract wins that could come through that could be further game changers for the business, I suppose. This one is, I think, $1.8 billion, $1.9 billion market cap now. DroneShield is over $4 billion. And this one has got probably double the earnings from memory. So yes, stocks run hard, but I'd say it's probably still a higher-risk buy here.

Sigma Healthcare.

Yes. Sigma is a buy, we think, and it's one that we've added to sort of post reporting. Yes, I mean the momentum within the Chemist Warehouse business is clearly incredibly strong, double-digit like-for-like throughout July and August. So yes, clearly, the business has very good momentum. We do think it's a beneficiary of rate cuts going forward. And then obviously, with the growth in the GLP-1 drugs, a specific, I guess, theme they flagged was as people come in and buy these GLP-1 drugs, they're buying other things in store too. So it actually is driving quite a bit of incremental foot traffic. So that should be a good tailwind for them into FY '26. And it looks as though the offshore expansion strategy with Ireland and whatnot is starting to gain some -- and potentially broader Europe starting to gain some traction. The only thing -- I guess the only thing we're cautious on the near term is obviously there's been some management changes flagged, which probably is unexpected. But yes, the equity markets had to absorb a lot of stock from insiders and the stock price is hung in there incredibly well. So yes, like I'd rather buy Sigma on 50x growing in the 10 to low 20s and Woolworths on 35x not growing.

Next is SKS Technologies Group.

That's probably a hold for us. And yes, in that space, we do have a few companies that are sort of similar -- there's quite a few companies. Obviously, Tasmia which Shaun talked about, GenusPus, we have SIG, we have Service Stream.

NRW acquired that's sort of in the space recently.

So the overall space is pretty -- we're pretty positive on the space.

Yes. We think there's significant tailwinds still to come there. SKS is the least sort of diversified in the space. So yes, we've just got preference elsewhere. But yes, it's clearly got good tailwinds at the moment.

Great. Healius?

Yes. So our exposure there is in ACL, Australian Clinical Labs. So 4-player market. We think ACL is doing a lot better on the margins. Obviously, there's a few challenges in the health care space. And so we are gravitating towards the ones that's been able to effectively have more streamlined processes, more digitized processes that allows for high margins and provides more margin of safety in terms of earnings. And so yes, our preference there will be ACL.

And your thoughts on Nuix?

Nuix, probably a hold. It's one we've had a look at it and there's had a few hiccups in terms of the -- and managing market expectations as well in terms of the execution by management. And the thematic is very positive. I think it's probably perhaps more on the execution side and -- but it's one that we sort of go through actually in detail every results and just to see where there's an opportunity. And with a lot of the technology companies, we have to weigh up all the options that we have in the fund, it has to effectively be more attractive than some of the stuff we have in the fund to buy it. And so not something we hold currently, but yes, I would say it's a hold.

Great. Thanks so much, both. So we have Hardeep who has asked for your views on the global small cap sector, they have underperformed for a while.

That's probably a question we could come back to you from the WAM Global team.

But if you -- I mean, the simplest thing, if you apply the same overlay that we do here domestically, like if you think the Fed is about to go through an easing cycle, then yes, I mean, smaller companies should, in theory, more economically sensitive, have underperformed relative to large in the U.S. as an example, too. So the same principles should apply.

Yes. You said of the banks, obviously, the magnificent 7, the large tech names dominate effectively U.S. equities.

Yes.

[ Meddie ] has asked, why is WAM Capital delivering average performance?

I think -- I'm hoping the question is around the share price. As an investment team, our job is to drive the performance of the fund itself. I think I ran this number earlier in terms of -- since 2022, obviously, that was a challenging year, we've delivered, I think, on a 1-year basis an outperformance versus the market of about 12% as at August, about 11% as at -- on a 2-year basis and about 9% from a 3-year basis. So we've been able to consistently outperform the market over the last 3 years. I think perhaps the question was around the share price and the share price not keeping up with the market. And we completely understand it's disappointing for those that bought share price, I guess, at a much higher level. I think WAM Capital and particularly WAM Research were trading at a significant premium to the underlying NTA. So I think WAM Capital was around 30%. I think WAM Research got close to 60%. So effectively, if you're buying shares, then you're buying $1 of assets that's only worth $1 for $1.30 or $1.60. And that's been one of the reasons why the share price itself, the listed company hasn't kept up with the market due to that premium reducing. However, we also pay out a very high grossed up dividend yield. So when we think about total shareholder returns, it's not only just the capital growth, but also the amount of stuff that we pay out. So if we hypothetically speaking, didn't pay out any dividend, the share price, assuming the premium stays the same, should have reflected, I guess, the outperformance of the fund, the underlying funds itself.

Okay. John has asked about Gentrack Group. What are your thoughts, and why have you invested in the company?

Gentrack has gone from what we would have called like among the largest small-cap darlings to, I'd say, at the very least divisive line. There's a lot of noise in the market at the moment around one small -- which they obviously came out and disclosed Red Energy, one small contract that they didn't effectively do just because the terms weren't attractive. So going from here, I mean, yes, you may have seen we've filed a substantial shareholders recently. We're very big supporters of management. Gary has done an excellent job at the business so far. And we think the key sort of catalysts near term there are, I guess, contract awards. We think we only take a couple and this share price could move quite material just because they haven't had any sort of news flow in that respect for a while. And medium term, a business growing 15% to 20% organically compound, and we've got a lot of confidence around that. So yes, we think it's an opportunity to, I suppose, buy while there's blood on the streets and everyone hates it, and you could see a pretty material re-rate if we're right, which hopefully we are.

But it's -- just to add to Shaun's point, I think a lot of the times -- and for probably some of the new shareholders, when we do increase subs and companies, the weight itself, the weight of the company in the portfolio is not that high. I think sometimes you see us, I think, EML, for example, we're 10% of the company. But obviously, the market cap is a lot smaller. So the weighting of some of these businesses in the fund is not as large as what perhaps looks to be.

Great. So Ian asks for your thoughts on Alliance Aviation.

Yes. I mean, Alliance, we've got a small holding in our microcap fund. The challenge there has been really just around, I guess, the prospects of deleveraging the balance sheet. And it just has seemed to unfortunately keep sort of kicking out to the right. There's no question it's -- like the business is fundamentally undervalued and cheap. But yes, we just want to get more confidence in that deleveraging profile. We felt like at this result, it probably did get kicked out about another 12 months. So one that, yes, we hold a small waiting in, keep our eye on and wait for the time to launch properly into.

George asks if there would be any benefits in merging WAM Active and WAM Research into WAM Capital?

Yes. So WAM Capital, and I think this obviously a question for the Board. But just in terms of the difference, WAM Capital has the research side of the portfolio and then also the trading side of the fund. And that's -- when you put 2 and 2 together, you get WAM Capital. Otherwise, investors, they have the option to just purely invest in WAM Research, which is more the research side or the Active which trades a lot more. So I think the -- ultimately, it's obviously a Board decision, but that does give shareholders an option depending on what suits their specific investment sort of needs. And so providing that option, I think, is quite important.

Great. Thanks so much, Tobias. This next question is from Ashok. He asks, what's your view on Mayfield Group?

Yes. I mean similar to like the comments I made before about G8, like the childcare industry has been tough over the past sort of 9 months, I suppose. Cost of living pressures have clearly weighed in terms of occupancy trends. You have to look at it really as a cross check throughout reporting season. Momentum was clearly building in the business through the period. They've got the same challenge in the sense that occupancy is well down on last year. So I think going forward, yes, if we come back to the basic principles around interest rate cuts, more healthy consumer and some supportive policies in the childcare industry, that should see occupancy rebound, which is the key driver of profitability for these businesses. So yes, I'd say it's probably a hold at the moment, but yes, they're looking more and more interesting, I think, these childcare names.

Great. Thanks so much. This next question is from George, and he asks, what went wrong with the DiGiCo floats?

Good question. I think the main thing that went wrong with the DiGiCo float aside from listing at a time when there was a bit of volatility in the market was probably the structure of the deal and the size of the deal. It was made out as though it was kept incredibly tight and you'd see this significant amount of index and I suppose, and then institutional buying post listing, which didn't really eventuate. Yes, from day 1, the stock sort of never traded above the IPO price. And there's a perception once that happens, it's "a broken IPO," and it can sort of take some time to recover. So yes, I think at the moment, yes, shareholders are sort of wanting to see further progress on the seed assets and where obviously they can -- you've got the HCF accreditation more recently. Now you want to see them start to fill some of that extra capacity within that data center. But yes, at this stage, it's probably a hold, I think. And it's probably just got to do some time to operationally execute, show some more positive catalysts and then people will be looking to revisit it.

The next question is from Tony. What are your thoughts on IDP education?

Yes, we own some IDP education, a stock that we've been close to for a long time now. We sold our shares out sort of a few years ago when it felt like, I guess, the policy dynamics within each of their key markets were becoming more restrictive. And that's obviously what we have seen play out. There's been some more green -- some green shoots there more recently, I suppose. The Australian government have come out and said they'll allow a 9% increase in student immigration into next year, obviously recognizing that it's the largest services export for our country. So it's pretty important that they continue to support. I think there's some recognition of that now. U.K., yes, it does feel as though the policy settings are getting incrementally more supportive. The stocks just left the ASX 100. So it's now back in the small cap index. So a lot of our peers in small caps will be dusting it back off and starting to do work again. And they'd have a more fond experience of IDP and would have wrote it on the up cycle when the shares went from like $4 or $5 to, I think it hit $35 at one point and come all the way back down now. Management are doing a good job on the cost base. So yes, we're holding it. It's not a large way at the moment, but we think any incremental positive news flow around policy dynamics in Canada and probably to a lesser extent, any further positives in the U.K., you could see this share price re-rate pretty dramatically. Management are talking to a flat cost base into FY '27. So if you see a volume rebound with a flat cost base, we think there's actually pretty significant earnings upgrades that could come through. So a little bit early. So it's one that we're -- we've got a holding in and staying very close to.

Great. Thanks so much. This next question is from Keith. He asks, what are your thoughts on Magellan's improved position and new management structure?

Yes, it's quite interesting. It's still on the list of things we're doing work on. I think the thing that really piqued our interest is around Viva. So that's a con fund. I think that's doing really well. And so really understanding how the strategy of that part of the business over time. And so yes, it's one that's on the to-do list.

Great. Thanks so much. Rick has asked, every month, the WAM Capital investment update specifically mentions $0.0161 of tax assets arising from the acquisition of investment companies. How can you realize these assets and realize these benefits?

Yes. So the capital loss is from historical acquisitions and can be offset against future acquisitions or future capital gains from future acquisitions. WAM Capital also recently realized around, I think, $0.022 per share of historical income tax losses and reduced it to the benefit of our shareholders.

Thanks, Tobias. This next question is from Cole. You have touched on Southern Cross Gold earlier, but how would you compare it to Tasmia?

Yes. I mean, fundamentally, Southern Cross Gold is a gold company versus Tasmia, which is essentially a maintenance services provider to the commodity and oil and gas industries. So that's obviously the fundamental difference. Southern Cross Gold is going to get, I guess, leverage purely to the gold price. Whereas Tasmia, we think a more diversified business, maintenance services operator. And as I sort of touched on before, balance sheet is in great shape. We think there's earnings accretive acquisitions to come near term. And it trades at probably a 20% discount to its listed peers with ASX 300 includes in March would be, I guess, a key potential catalyst to close that valuation gap. So yes, different industry, different risk profile, obviously. Yes, that's probably all I'd say there.

Great. Thanks so much. John has asked, what are your 5 worst duds for the year?

Five worst duds. I'll say like -- yes, so in terms of duds, we look at companies that we've sold out. So a lot of the times, it's things that we still like we're sort of adding to it and perhaps hasn't been realized. I'm just -- off the top of my head, IPH closed the loop. That's been one that hasn't. G8 obviously. Austin Engineering. That's unfortunately, Phil, I'm trying to think. What else? And sometimes it's missing things that's gone up as well in an upward market. I'm trying to think what else. Yes, those are 4 out of the 5. Event Hospitality, which obviously -- but that's something, as we explained earlier, we quite like and we're sort of buying it out.

Actively traded the way, yes, quite well around that.

Great. Thanks so much. We've had more stock pick questions come through. So what are your thoughts on Pro Medicus?

Positive. Pro Medicus will be a buy for us. They are the only business on the -- one of the only handful of businesses in the world where they're delivering 30% top line growth and I think 75% EBIT margins, and they've done that for 10 years in a row. The product is well ahead of their competitors. And so they are currently, I think, around 11% to 12% market share in the U.S. Longer term, that share could be a lot larger, and this is only in the radiology space. They've gone -- just gone into cardiology. And the cardiology -- they've won their first contract in cardiology, and that's another large total addressable market, and they've just started to go into pathology as well. So there's a lot of other ology opportunities, which is based on one platform. Many of their peers or the larger peers, they have multiple products based on multiple platforms. And hence, it's not as clean or as efficient as the way they've done it. And over time, we just think they will continue to win share. They haven't lost a customer in 20 years or client in 20 years. So it's an amazing business. And so yes, it's a buy for us, we think the catalyst is the contract awards.

Great. Next one is Jumbo Interactive.

I'd say Jumbo is probably a hold. The challenge there is sort of identifying a catalyst to re-rate the stock outside of the jackpot cycle, I suppose. They did recently sign a SaaS agreement with Queensland RSL, which is the key growth opportunity for the business is growing the SaaS. Yes, they sort of struggled to find an acquisition that makes sense there. The balance sheet is obviously in great shape. So they've got, I guess, optionality to deploy into a buyback or M&A. But yes, for us, it's sort of just trying to find a larger catalyst outside of just tracking the jackpot cycle. So for that reason, it's probably a hold.

This one is from Georgina. How are you playing the AI investment trends in the small cap space?

Yes. I mean, it's a point I touched on before, like in terms of getting direct exposure to the AI thematic, it's -- the ASX is, quite frankly, pretty limited. But we think the highest quality play is Megaport. The CEO, Michael Reeds, came in there a couple of years ago and honestly has done what we think is an amazing job in terms of really completely restructuring the organization, refocusing the go-to-market, created a real drive around new products and essentially broadening their share of customer wallet. And you're only -- you're starting to see that now come through in terms of the operating metrics. So yes, they've decided the best course of action is to double down and obviously drive the product development and go-to-market side harder and really try and capitalize on this AI trend, which will suppress the earnings like the operating leverage in the short term. But what we think it does is sees revenue growth actually accelerate particularly into FY '27, well above where consensus is estimating. So -- and then it will be at that point, they can demonstrate and show that the operating leverage can come through. So yes, we really like Megaport. It's one of our larger positions, and we think that's the best way to play it here domestically.

Great. Thanks so much. Jeremy has asked, have you ever considered cash converters?

Yes, I have looked at cash converters. I met them recently. It does look interesting, definitely. Yes, I think the franchisee roll-up strategy that they're undertaking, like it's a proven model in terms of being able to arbitrage the model and internalize and create value by bringing them back into company hands. The exit of payday lending looks very smart to me. And from an equity market point of view, people don't necessarily like the payday lending side of things. So yes, I think it does have a good run rate in terms of the rollout strategy and then obviously, expansion overseas into the U.K. So yes, it's actually one that I do think looks quite interesting. I'm doing work on it at the moment.

Great. Thanks so much. You touched on this earlier. However, Linda has asked for your view on Superloop, please.

Yes. Yes, Superloop, we have in the fund -- in the WAM Microcap fund. The management has done a good job executing on the organic growth profile and also entering into partnerships with the likes of Origin, et cetera, to grow their subscriber base. The opportunity longer term is obviously some of these younger, newer challenges taking share of the large 3 incumbents. And I think Shaun touched on this earlier, there's a potential large churn event that's coming up over the next few months. So if they can execute on winning a larger part of that -- the churn, definitely looks very attractive.

Great. Thanks so much. Ian has asked what your thoughts are on EDU Holdings?

EDU. Yes, sorry.

EDU. Sorry, I've got nothing I can add there.

All good. Bill has asked, is Australian Clinical Labs a likely takeover target?

Perhaps, but you would have seen ACL went -- this would have been maybe 12 months ago, had looked to effectively acquire Healius. We think there's a lot of strategic rationale with the merger of those 2 businesses. And effectively, that's perhaps a potential scenario just if they revisited that story at some point in the future. But yes, I mean, health care assets, there's always interest. We've had quite a few a few years ago get acquired, Estia Health, which we had 10% shareholders -- shareholding in, National Vets and there was a few others. So the health care asset space is always like pretty attractive to private equity.

The most talked about merger is ACL and Healius. We're just not 100% convinced on the ACCC clearance.

Thanks so much. Joseph asks, do you own Lifestyle Communities?

We don't own Lifestyle Communities, but we really do like the land lease space. We were one of the larger participants in the recent GemLife IPO where we rate founder-led business, management incredibly strong across the detail, beat their prospectus forecast by 8%, and we think they're well placed to upgrade earnings in the future. We also own Aspen, APZ in that space, remain positive on that one, and we own Ingenia too. So we like the thematic. The reasons we haven't owned LIC for a while, obviously, the DMF fee and the question marks that, that has. And then just the Victorian property market generally post the tax changes sort of 18 months ago has been very, very challenging. And obviously, there's been management changeover and whatnot. So we really like the space, like the thematic. Interestingly, I'd say the conversations we're having with management teams on Victoria, it has bottomed. There are green shoots. So yes, it probably is the time to start revisiting LIC.

Great. Christopher has asked for your thoughts on IVE Group.

Yes. IVE will probably be a hold for us. We haven't done a lot of work recently on it. I think their share price has done well, and they've continued to -- when we did the work last time, they had very good management running the business. So again, it's probably one of the companies we put it on to -- it's currently, I think, around $300 million, $400 million market cap. So it fits well in the WAM Microcap strategy and it will be one that we'll be looking at.

Great. The next question is from Roger and he asked for your view on Symal.

Yes. So Symal, we like management. And so I think one of the challenges with a lot of the services companies is there's quite a few around. And so the Symal management we've met in the past, they've done a very good job growing the business. And so we obviously like the story by the management there. But the -- in terms of more near term, some of the larger mining services companies, I think, with more near-term catalysts, other ones we've effectively gravitated towards.

Now both of you, what do you think of AlFabs? And would you hold it at some stage?

Again, I think that's a contractor services business, probably no real short-term views right now. But again, we have quite a few of the contractors in the fund already. And I think the key for many of them is just how do they take the next leg up into a market cap where we can get index inclusion as an example, as a catalyst to attract more capital into the business.

Great. Thanks so much. Ashok asks, is Lovisa a buy, hold or a sell?

Yes. Lovisa is held in WAM Capital. We still think it's a buy. Obviously, there was a lot of concern around Victor, the previous CEO sort of exiting the business and what that would mean going forward. But if we take a step back, like we think they've got probably the best management team in the country in retail. Mark McGinnis has been brought in as a Chairman. And I can tell you he's not getting paid $1 million as the Chairman to sit on your hands and do nothing. We really rate Mark from his previous endeavors at Premier. And then obviously, they've brought John Cheston in as well, who was previous CEO of Smiggle. Yes, we think they're really high caliber retail executives. You can see through the second half that the store rollout is reaccelerating. And then really pleasing to see the like-for-like momentum improved to, I think it was 5.8%, sort of 6% through that July, August period. So yes, we think the business looks like it's got really strong momentum. There's still a high level of short interest in it that's not easy to cover in the screen. So yes, we think this one can keep going.

Thanks so much. This question is from Lloyd. Thoughts on Fleetwood Limited.

Fleetwood, not one I've sort of looked at more recently. Again, it probably goes to the point that we already hold like a lot of, I suppose, similar investments within this space. So yes, not one we sort of own at the moment, but have in the past. And yes, clearly, the guys -- they've done a good job in terms of restructuring the business and sort of refocusing it. But yes, probably not one we're ranking at the moment.

Great. Thanks so much. This question is from [ Stephen. ] Is a $0.10 per share dividend unfranked identical to a $0.07 per share dividend fully franked?

I think that depends on you as a shareholder, the specific financial situation, if I understood your question correctly, and the value of franking credits to you. So if the shareholder values income more versus the value of the franking, a higher unfranked dividend will be more beneficial and vice versa. So I think it really comes down to the financial tax situation for the shareholder.

Great. Thanks so much. Ian asks, what is your opinion on Mineral Resources?

Yes, it's clearly been a very topical stock over the past 12 months. I think ultimately, if you think iron ores going to -- iron ore prices are going to sort of hanging around here and they can bring their production online without any hiccups, which does seem as though they're on track for at this point, then it probably is good buying here, I think. And then clearly, I'm not going to call the bottom in the lithium market just yet. I think it's sort of bouncing along the bottom. But if the lithium -- if we continue to see more supply cuts and you start to see lithium prices lifting from here, then you get a free option on lithium, too. So yes, I think it's a buy here.

Great. Peter asks for your thoughts on Praemium.

Praemium. So we have HUB and Netwealth in our funds. Praemium is a little bit smaller. I think for that one, we're still waiting to see real operating leverage. Because of the smaller scale, they kind of use the scale advantage at some of the larger -- the challengers like as Netwealth and Hub has -- they've invested a lot into the tech stack and into the sales network and into products. So Praemium, I think the result was actually a decent result, but I think we were looking for more sort of traction on the operating cadence to really look at it.

And yes, we've got an investment in HUB as well. So yes, we're probably just playing that thematic sort of through Hub. I mean that's a proven operator with incredible scale and still a very strong pipeline for flows.

Great. Thanks very much. Joseph asks, what is your view on Cedar Woods Properties?

Yes. Cedar Woods is a buy for us. We own that one within WAM Microcap. Yes, clearly, management executed strongly throughout this period. You're seeing broad-based price growth in each of their markets. WA has obviously been strong, Queensland as well and Adelaide, too. We think much like FY '25, the initial guidance they've set for FY '26 of 10% to 15% NPAT growth from memory is conservative. And we think we'll -- there's definitely prospects of earnings upgrades there. I'd say in terms of other catalysts, this one is pretty close, if not for ASX 300 inclusion in March, and it's a fairly liquid stock. So that will be a tailwind for the share price. And then I'd say more medium term, we like their capital-light partner strategy where they're bringing in some other partners to fund the development, which ultimately increases the ROE. So yes, we like Cedar Woods, it looks well for us.

And what is your view on Accent Group?

AX1 is a sell for me. I think the brands are struggling for relevance. Just, I guess, the ongoing disintermediation and brands looking to go more and more direct-to-consumer, I think, makes it more and more challenging. We saw through the recent, I guess, reporting period that pretty much every retailer reported buoyant current trading in July and August. And I think Accent's comps were flat or sort of low single -- very low single digits. So yes, our question mark is probably more around the structural -- potential structural headwinds the business is facing at this stage. So we're just seeing those better plays elsewhere.

Great. Thanks very much. Marcel has asked, if you have any thoughts on Singular Health Group. Is Vulcan Energy Resources a stock that you would consider?

I can't say I can give you much insight on either to be honest, sorry. But we -- I'm very happy to have a look at -- I've never even looked at SHG. So that's on this afternoon's list.

Thanks, Shaun. Ashok has asked, if you hold Dicker Data in the portfolio?

Unfortunately, we're keen to participate in the sell-down, but that didn't sort of eventuate for us. Yes. I mean, Dicker Data, I think it's a buyer. You've got obviously the tailwinds for small, medium businesses with improving economy, falling rate environment. And then they should be a beneficiary of the AI replacement cycle in laptops and things like that. So yes, I think it's still coming out that one.

Great. Thanks very much, both. So those are the questions we have received. If we didn't get to any during the webinar, we will get back in touch with you. Before I hand over to you, Tobias, for your closing remarks, I just wanted to touch on how we will be traveling to Newcastle, Toowoomba, Gold Coast and Noosa in October for our shareholder presentations. You will be able to meet the investment team and grab a coffee with them during these presentations. If you are interested, please do register using the QR code displayed on the screen. But I will pass over to Tobias for some closing remarks.

Well, look, thank you, everyone, for sending through the questions and to Shaun and Emiko for joining us today. The recording of the call will be available on our website shortly. As always, these are your companies. Please get in touch with us via phone or e-mail at any time and really appreciate your support. Thank you, and have a great afternoon.

Thanks so much.