Web Travel Group Limited (WEB) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen. It's now just after 5:00 Melbourne Time, and I would like to extend a warm welcome to the Webjet Annual General Meeting for 2020. My name is Roger Sharp, and I will chair today's meeting. Our company secretary, Tony Ristevski, confirms that a quorum is present and that no other items of business have been notified. Therefore, we will work to the agenda published with the notice of meeting. I now formally declare the meeting open. Today's meeting is being held online via the Lumi platform in response to government restrictions and the potential health risks associated with the ongoing COVID-19 pandemic. It's also being webcast to the wider investment community. This format enables shareholders, proxies and guests to attend the meeting virtually. All attendees can watch a live webcast of the meeting. In addition, shareholders and proxy holders have the ability to ask questions and submit votes. Questions from shareholders can be submitted at any time during today's meeting. To ask a question, press on the speech bubble icon, which will open in your screen. At the bottom of that screen, there is a section for you to type your question. Once you finish typing, please press the arrow symbol to send. Please note that your questions may be moderated or if there are multiple questions on one topic, amalgamated. They'll be read out to me by our Head of Investor Relations, Carolyn Mole. I will respond to general questions and may ask colleagues that are present to respond on specific matters such as the audit report or our matters relating to compensation. It's important for shareholders to be aware that we have observed transmission delays in other meetings using this online format. Consequently, we are aware of instances where shareholders have asked questions that haven't found their way to the Chair of the meeting in time and have been passed over. So we encourage shareholders to address the potential for delay by getting your questions in early. We will respond to shareholders' questions multiple times during this meeting. Firstly, I'll answer general questions on the company's business after the Chairman's and Managing Director's addresses have been delivered and prior to starting the formal business of the meeting. Secondly, I will respond to questions as they relate to each resolution before you vote. We do ask to assist the meeting to proceed smoothly. Can you please identify the resolution to which your question relates by typing in the resolution number before you enter your questions? Finally, I'll check again prior to the conclusion of the meeting to see if any remaining questions -- if there are any remaining questions. Now this is Webjet's first online meeting. And if for some reason your question is not answered, please e-mail it to Carolyn at [email protected], and we will respond to you promptly. That's [email protected]. The notice of meeting and explanatory statement were dispatched to shareholders on 18 September 2020 in compliance with the company's constitution. And I propose to take them as read. Before we get underway, I would like to introduce my fellow directors who are present. And although you cannot see them, I assure you they're here. Firstly, Deputy Chair, Don Clarke; and Lead Independent Director, Brad Holman, both of whom are standing for reelection at this meeting; Managing Director, John Guscic; Audit Committee Chair, Nonexecutive Director, Toni Korsanos; and Nonexecutive Director, Shelley Roberts. I'd also like to take this opportunity to introduce the senior members of the management team who are present. Unfortunately, there are too many to call out individually, although I do wish to acknowledge our Chief Financial Officer, Tony Ristevski; and our Chief Commercial Officer, Shelley Beasley. Finally, I would like to acknowledge the presence of our audit partner from Deloitte, Stephen Rush. The minutes of the previous Annual General Meeting of members held on the 20th of November 2019 were approved by the Board and signed in accordance with the provisions of Section 251A of the Corporations Act. These minutes are tabled and there are copies available for inspection should any member wish to see them by contacting the Company Secretary. Moving to today's business. There are 2 major components to today's meeting. Firstly, I'll make some introductory comments about the business about FY '20 and subsequent events in my chair's address. And then our Managing Director, John Guscic, will update you on your company's performance and outlook. After this, we'll deal with the formal business as set out in the notice of meeting. We do have a relatively full agenda today. So firstly, I'll table the company's 2020 Annual Report and accounts for comment. And then we will put 7 resolutions to the meeting, namely, to adopt the remuneration report; reelect 2 directors, Don and Brad; ratify shares issued under the institutional placement in April 2020; approve the issue of equity-settled notes to replace the existing cash-settled notes issued in July 2020; approve Webjet's new long-term incentive plan; and finally, approve the Managing Director's participation in the company's new long-term incentive plan. Voting today will be conducted by way of a poll on all items of business. In order to provide you with enough time to vote, I will shortly open voting for all resolutions. When I do open the voting, if you are eligible to vote at this meeting, a new polling icon will appear. Selecting this icon will bring up the listed resolutions and present you with voting options. To cast your vote, simply select one of the options. There's no need to press submit or an enter button because the vote is automatically recorded. You do, however, have the ability to change your vote up until the time I declare voting closed. So I now declare voting open on all items of business; a polling icon will soon appear. Please submit your votes at any time, and I'll provide ample notice prior to the close of the meeting. Shareholders are reminded that your Board strongly recommends that you vote for all resolutions. I appoint Nigel Bulling of Computershare Investor Services to be Returning Officer and to conduct the poll. The results of the poll will both be reported to ASX after the meeting and will be available on the company's website, webjetlimited.com. During the formal business of the meeting, we will display the proxy votes received on the screen before voting takes place. Please note that only shareholders and proxy holders who have registered today on the platform will be able to lodge questions or comments. Please address questions or comments about the business to John after his presentation, and any questions or comments about the formal business of the meeting to me. I'll now move to my chair address, briefly recapping the 2020 financial year, and then we'll pass on to John for a more fulsome commentary on FY '20 and the outlook. On the 19th of February 2020, Webjet announced a record FY '20 first half results and provided full year guidance of AUD 162 million to AUD 172 million of EBITDA. At the time when COVID-19 was emerging from Asia, the travel industry's previous experience with SARS and MERS pointed to a 6-month recovery period. However, clearly, that proved to not be the case. Our first half profits quickly became a memory as borders were closed from March and the gains of the first half were erased. Full year FY '20 TTV was down 21% on the prior year of $3 billion. Revenue was down 27% to $266.1 million, and EBITDA for underlying operations was down 80% to $26.4 million. By year-end, most of the global travel industry was on life support, and Webjet was losing money. In the face of what can only be described as an existential threat, your company moved very quickly to rethink its strategy, to restructure and recapitalize. Our response involved a review of our strategy as a company, of our people, our technology, our operating costs, our investments and our balance sheet. It was very quickly becoming unclear back in February, March how long this crisis would last. So we decided to focus simply on the matters that we can control. We determined that we would recapitalize early to remove all financial risk in the business, so we could focus on emerging leaner, faster, hungrier and more focused on our customers than ever before. This would require some strategic thinking and in a hurry. So before recapitalizing we revisited our strategy as a company to make sure we could emerge from this crisis stronger. Strategies were put in place to win market share and be more profitable in all of our businesses so that we are well-placed to compete as soon as the travel markets reopen. WebBeds' transformation strategy is aimed at emerging as the #1 global B2B player. Webjet OTA's strategy is to leverage its brand strength and prepare for a domestic-led tourism recovery while we wait for international markets to progressively reopen. Online Republic's strategy is to improve its underlying performance through sharpening its product offering and enhancing its processes. Having confirmed our strategy, we quickly embarked on an urgent restructuring aimed at significantly reducing the company's costs but leaving the fabric of the business intact so that could capitalize on the upturn when it eventuates. A range of initiatives quickly reduced costs by around 50% from a mixture of job reductions, 4-day working weeks, pay cuts as well as reductions in other operating expenditure. The Webjet Exclusives and Online Republic cruise businesses were closed. Having rethought our strategy and taking cost out, the next step was clearly to recapitalize the business. In April 2020, we completed a $346 million institutional placement and accelerated pro-rata non-renounceable entitlement offer. In a volatile and highly tricky environment, this was not a straightforward process. Shortly after balance date, we followed with a EUR 100 million notes offering, which is AUD 163 million. The proceeds from the placement and the entitlement offer materially strengthened the company's balance sheet and supported the unwind of negative working capital and the reduction of B2B debtor exposure. $50 million of the notes proceeds were applied to repaying existing term debt. We worked very proactively with our bankers to extend the maturity of our remaining term debt, which is now due in November 2022. Banking covenant waivers have also been obtained. As a consequence, Webjet entered FY '21 in a strong financial position with adequate cash reserves for at least 2 years of difficult trading as well as an extended senior debt maturity. At this point, I'd like to focus for a moment on customer service within our Webjet OTA. You'll hear me come back to this a couple of times today. Webjet OTA was founded on the philosophy that we will offer our customers convenience, choice and great service. It's certainly a source of regret to us that this pandemic has affected our ability to consistently provide the level of service we've prided ourselves in giving our customers for more than 20 years. That is now resolving itself with over 30,000 refunds in process or delivered from our airline partners and some of our 100,000 customers with flight credits now beginning to redeem their credits for new trips around Australia. We continue to work with airlines and other providers to secure refunds and to obtain satisfactory outcomes for our customers. Rest assured, this remains a key priority for our Customer Service teams. Let's turn to recovery. At the time of the half year result, it was almost inconceivable that we would end up in the current situation we find ourselves in. It's fair to say that this is nothing -- absolutely nothing like the other pandemics the industry has experienced and will require -- likely require widespread availability of vaccines for travel as we know it or as we used to know to resume. On that note, we do believe there's a reasonable probability that safe and effective vaccines and other pandemic management strategies will start to become available in the very near future. However, the speed and efficacy of those processes being rolled out will vary radically market by market. But at Webjet, we do believe that people will resume their travel patterns as conditions permit. We see considerable pent-up demand building for the travel services and products that we sell. We see this especially in the leisure sector, which will come out of the gate strongly. This recovery will be decidedly non-linear and will initially emerge where there are either vaccines or in safe corridors. The strategies I've already spoken about are focused on ensuring that we are there to capture demand as it emerges and provide great service to our customers and partners. I'll now move on to governance. With the global travel industry arguably being the worst affected industry globally by the COVID-19 pandemic, a focus on strong governance and risk management practices had never been more important. Our key focus during this difficult time has been to ensure that the company survives and that our staff are safe. We certainly remain conscious of and committed to meeting our contemporary governance responsibilities and we will continue to expand our focus and reporting on them as the pandemic resolves itself. The company's policies can be easily accessed on the governance pages of our investor website, webjetlimited.com. And they include policies on governance, corporate social responsibility and sustainability. At Webjet, we are proud to run an inclusive and diverse meritocracy that cares about its people and its customers and understand its environmental and social responsibilities. We recognize the importance of operating in an environmentally responsible manner and that our customers want to be able to make sustainable choices. To that end, we recently introduced carbon offsets to the Webjet OTA. This is a unique value proposition that enables our customers to choose to travel with multiple suppliers but to link their purchase with a carbon offset across the entire journey. I'll now switch to the subject of executive remuneration. During calendar 2020, we quickly effected reductions in our overheads, which has required us to reduce both headcount and salaries. As a consequence, our people have made quite significant sacrifices. Our employees took either 20% pay cuts or moved to 4-day weeks. Our Managing Director voluntarily took a 60% pay cut. Your directors took a 20% voluntary reduction in their directors' fees. All equity incentives in FY '20 STIs were canceled. And it's in that context that your Board today seeks shareholder approval to introduce new long-term incentive plans for our senior leadership and for our Managing Director. It's timely for us to remind shareholders just how scarce real talent is in this environment. The pandemic has unleashed a full-scale global digital transformation, and that means that tech companies everywhere are engaged in a war for talent. We have that talent, it is in demand, and we need to protect it. Your Board is acutely aware there have been substantial Against votes on Resolution 7, which is the resolution to approve the proposed award of options to our Managing Director, John Guscic, under the company's long-term incentive plan. Since consulting with proxy advisers and negotiating the terms with John, the share price has risen materially to the extent that some commentators believe these options are in the money and that there is therefore somehow a transfer of wealth from the company to John. I do wish to make a couple of critical observations in relation to this perception. Firstly, your Board cannot plan for volatility in the share price when we negotiate such arrangements, nor indeed as we govern your company. We simply use the facts available to us at the time and at all times seek to do the right things by our stakeholders. And secondly, these are not free shares. They need to be bought for hard cash. And while we are doing all we can to deliver growth for shareholders, there is no guarantee the exercise price will be in the money at the time John is actually entitled to exercise them. These are supremely volatile times for our industry, and it's not possible to predict with any certainty what the share price will be when these options are able to be exercised. Would anyone have thought only 9 months ago when the share price was in the $14 range that we will be raising capital in a pandemic at $1.70? Given these factors and the importance of retaining key talent to ensure that we're best placed to compete when travel markets return, we strongly believe the circumstances warrant a For vote rather than an Against vote in respect to Resolution 7. To wrap up, I'd like to pay tribute to the stakeholders who have been supporting this business in what is without question the toughest period in its 21-year life. Firstly, your Board and management have worked absolutely tirelessly to respond decisively to the pandemic. I'd like to pay tribute to my fellow Nonexecutive Directors Don Clarke, Brad Holman, Toni Korsanos and Shelley Roberts. And to John Guscic, Tony Ristevski, Shelly Beasley, Dave Galt and the entire Webjet team. We are saddened to have parted company with some team members and we are grateful to others who have graciously accepted 4-day working weeks, pay cuts and a range of other measures essential to our survival. Their dedication and willingness to go the extra mile is the reason that we know we will navigate this difficult time successfully. And at the risk of repeating myself, I’d particularly like to call out the efforts of our front line customer service staff. Our team has gone above and beyond to solve customers' problems this year and there are many unsung heroes within our business who managed to get customers home just as borders were closing, and have gone to bat with our suppliers to secure refunds and credits. Life is not easy when you are dealing with customers in a pandemic, so to all of our frontline team members who have kept their composure in the most difficult of circumstances, I would like to record the Board's profound appreciation. Finally, thank you to our shareholders for supporting Webjet throughout the restructuring. And a very warm welcome to the more than 50,000 new shareholders who have joined our register. We really appreciate the trust you place in us. I'll now hand over to John for his Managing Director's address.

Thank you, Roger. It's been an unprecedented year. And I will present in an unprecedented fashion, obviously, remotely. And rather than focus exclusively on the year that was, I will spend a little bit of time covering the issues that we faced in '20, what we did in financial year '20, with the emphasis primarily being what does the future hold for the travel industry? Where does Webjet fit into that travel industry? And what are our plans to compete going forward. Next slide. As Roger has covered, we had a record first half of $86.3 million. More than 60% of the EBITDA was driven by WebBeds, and we clearly cemented our position as the fastest-growing and #2 global B2B player. Our profitability targets were tracking ahead of expectation, and the Webjet OTA business performed well. Clearly, as has been well documented and has enveloped our lives, the COVID-19 pandemic has created unprecedented disruption to the global travel industry to the effect that many businesses were, in effect, shut down. A significant amount of closures occurred from mid-March onwards resulting in nominal revenues for our business in the second half and a significant number of one-off charges. What we have done as a business is focused on the elements we could control. Clearly, costs were a primary focus in our attempt to minimize the impact of COVID, and we've also looked at strengthening our balance sheet through the equity raising and the notes offering that Roger has described. In FY '21, we start off with a strong capital position, which continues to provide us with financial strength and strategic flexibility. Next slide. As we can see, the drop-off in performance in the second half was significant. We had a business that was on track to exceed the historical previous years that we've achieved in our results. We're on track to make a number between $162 million and $172 million at an EBITDA level. On a calendar year level, if you take the second half of calendar year -- financial year '19, first half of financial year '20, put it together, we delivered well over $155 million. So the business was in great shape. COVID came along, changed the substantial underlying performance, so we needed to respond. Next slide. The response that we have put in place has resulted in a 50% reduction in the costs in Q4. They were employee-related costs, operational expenses and other costs, and the closure of the Webjet Exclusives and Online Republic cruise business, and the deferral of first half '20 dividend payment. What we did to ensure that we survived an unprecedented period was focus on increasing liquidity. To that extent, we had a $346 million equity raise on the 1st of April. That was primarily used to strengthen the balance sheet, support the unwind of negative working capital and minimize the impact of any B2B debtor exposure. In addition, on the 1st of July, we raised EUR 100 million in a notes offering. We repaid AUD 50 million of existing term debt while extending our term maturity and, again, continued to strengthen the balance sheet. In addition, our debt maturity profile was extended to November 2022. $130 million is now due in November, '22, providing 2.5 -- 2-plus years to refinance. Banking waivers were extended to June '21 and modified test to June '22. Credit facilities were rebalanced to reflect the increase in our European funding. So how have we gone since in Q4? So I'd like to give an update on our liquidity, which is clearly the #1 focus within our organization. Our Q1 '21 monthly cash burn, including working capital, is negative $6 million a month. So we started the end of the financial year on a pro forma basis with $320 million of cash. If we look at our cash burn rate, excluding working capital, so that is all revenues, less OpEx, CapEx, interest and tax, we were burning through roughly $9 million a month. And then we go through the working capital improvements, on the WebBeds side, plus $13 million; Webjet OTA, plus $3 million; and Online Republic minus $7 million, netting all of that off to an improvement of $9 million on our cash position, resulting in a cash at bank of $302 million at 30th of September 2020. Our monthly cash burn is less than expected. And that's primarily a factor of a continuation of lower OpEx -- sorry, next slide, lower OpEx and a combination of staff attrition. We have and are continuously focused on ensuring that the business is appropriately levered to take advantage of the recovery when it does occur, but doesn't have an overhang of excess cost in the business. And as such, we have and continue to identify additional cost savings. The TTV growth that we're starting to see across all 3 of our business units has contributed to a net improvement in positive working capital. In WebBeds, the most significant improvement in our working capital position is a factor of -- is a combination of 2 elements. The first is that our business grows, we produce a positive working capital, and that's been the historic growth pattern of our business. In -- from the substantial lows of Q4 '20 we're seeing an improvement in positive working capital of $7 million in the first quarter from the WebBeds business, an improvement in collection of aged debtors of around about $6 million, improving our cash position net for the WebBeds business on a working capital basis of $13 million. The OTA business also has a positive working capital as the business grows. Our business has grown since Q4. Consequently, our working capital has improved. And Online Republic, excluding cruise, which has been an unwind -- a continuous unwind of forward bookings, that's expected to be completed this month in October '20. The net position of online Republic would have been 0, excluding the unwind of the cruise business, which, as we have already discussed, we are in the process of closing that business in its entirety. Next slide. We're now going to move to forward-looking statements around both the industry and the business and in particular where Webjet fits into that business. So the outlook to travel is in the long-term travel will be -- as it has continued to be fundamental to the interconnectiveness of a global society, the demand for travel will grow. The spend on leisure tourism will continue to increase, and travel will be seen as an integral part of life. Next slide. As we think about where we fit in that context, we clearly are in a process where the markets have been disrupted substantially and it's up to us to position ourselves to be appropriately geared to the exposure of the recovery of those travel businesses. In our perception and what we have seen historically and for many thought leaders in the industry, leisure travel is expected to lead the rebound. That has happened in every historical downturn in markets where post recession leisure travel has recovered first, and we would anticipate that to occur. In particular, we encourage investors to think about -- we want to think about the impacts of -- sorry, the potential for leisure travel to recover post the recovery to read the McKinsey's report, where it goes through quite substantially the story around why leisure travel has been the leading recovery in past downturns and why it's expected to be in this particular one. And there's many examples over the last couple months of senior people in the travel industry adding their voice to the fact that the domestic market and the leisure markets will be the first to rebound and recover. Next slide. There is ample evidence, and in particular, this is from GDS. It talks about that global travelers, in particular, will be looking to travel as soon as they're safe to do that. And there's evidence there on this slide. We move to the next slide, which focuses that in that context of recovery, domestic trips are the key drivers in that leisure recovery. As you can see by the blue line, we are starting to see a recovery from domestic as opposed to international, which is the green line, which is still bumping along the bottom. And we're seeing that as a global phenomenon across all of our markets. Next slide. Consumer confidence remains strong in our industry, and 96% of surveyed global travelers say they will continue to fly and 94% of global travelers say they'll continue to use hotels. So notwithstanding the early concerns that many people had about what the recovery would look like, clearly there is significant pent-up demand for people to get on with their lives and live it in a way that demonstrates the desire to connect with other people. Next slide. So what we think will happen is that demand will return to their long-term growth levels. And Webjet in particular is the global travel business. It's well-placed to capture that pickup in global demand. What we do do is provide a critical and cost-effective distribution channel for the travel industry. We have a diverse geographic and customer mix providing a strong exposure to global domestic leisure markets. And our global footprint and highly diverse customer base will ensure that Webjet can capture demand wherever it is available. The significant issues for us is that the structural shift that has been accelerated over these last 6 months, and we see them in so many other platform businesses other than travel, which we're seeing the shift from off-line to online has accelerated, and we are well-positioned to capture that demand. The Webjet OTA is the #1 OTA in Australia and New Zealand, with significant brand strength and superior technology offerings. Online Republic is a global #1 provider of motorhomes that has significant presence in cars in the Australasian business with broad content and strong online marketing capabilities. And WebBeds' fastest-growing division is selling hotel inventory to the top 5 online travel companies globally. We continue to see consolidation and rationalization occurring across the globe. We are seeing a number of the smaller competitors that have gone out of business and the competitive landscape has changed over the last 6 months. We believe our strengthened balance sheet and capital position provides us with the financial and strategic flexibility to take advantage of the significant raft of attractive opportunities that are available to the broader Webjet enterprises to gain market share. Next slide. If we go to WebBeds, WebBeds has got a diversified customer base and geographic mix. We have literally tens of thousands of customers. And our focus has been, over the last 6 months, to ensure that the transformation strategy that we have undertaken enables us to be the #1 global player in the B2B space. So what our transformation strategy is attempting to undertake is a rethinking of how we do business, streamlining the technology to enable us to deliver a seamless interface across all of our tech platforms, include -- increase the leverage of our data analytics and automation, have a sharper focus on cost-reduction opportunities and a refinement of our risk management process. To that end, as we have previously articulated, the breakeven scenario for our business is now 40% of calendar year '19's TTV. And what you can see is aggregate monthly TTV numbers for our business or on a weekly basis on a percentage versus the same time last year of how we are tracking and you're seeing a relatively stable performance and clearly a fair way to go before we achieve our breakeven for FY '19. Next slide. But to that extent, what we are focused on is an environment where I spoke about the transformative elements of our restructure and strategic drivers on the previous slide, what we're seeing in APAC is the first market that's responding to the transform business that we've undertaken. And what we have done, and APAC is an illustrated example in our Asia Pacific region, which is that we are focused on a recognition that over the short term being the next 6, 12, 18 months the domestic sales will be the key driver of our business. As such, we are focused on increasing the quality of domestic content in our respective markets in Asia Pacific, and in addition, targeting travel organizations in which we can sell that domestic content. And as you can see, over the course of the last 3 months, we've approximately doubled the percentage of our bookings compared to last year. So early mid-July, we were roughly 20% of last year's booking volume, and we're now up to 40% in Asia, and our TTV which was 10% of our historic TTV versus last year has gone up to 30%. So as you can see, the bookings that we were getting 3 months ago had a historical very low average booking value. But as we have grown our business, the booking value has grown in line with the increase of bookings itself, which sees the TTV revenue tipping up towards 30% from a basic 10, which demonstrates that the strategy is: one, working; and two, we're getting actually higher booking values, notwithstanding that they are domestic bookings. Moving on to the next slide. The Webjet OTA booking growth as domestic markets reopen, we're well-positioned to achieve growth. Historically, we have been 50% of the entire OTA flights market and more than 5% of the domestic flight market, where 85% of our bookings are domestic. And of those domestic bookings, we predominantly serve the leisure market. We anticipate strong international demand once borders reopen, but we are seeing the structural shift from off-line to online has accelerated. And we have a view that the travel recovery will be domestic driven, and it will be driven in the leisure markets. So how does that look like from our booking volumes? As you can see, again, as we showed earlier, there is the monthly aggregation of our sales data in bookings. And then you've got average daily bookings as a percentage of last year. The breakeven scenario for us is to get to 23% of calendar year '19's bookings. And we had a peak early in July, got to 16%, and we're approximately at that level now in mid-October. So we are seeing that we are 2/3 of the way to profitability. As the borders progressively reopen -- as the domestic borders progressively reopen in Australia over the next couple of months, the Webjet OTA business will be profitable. As soon as the Melbourne to Sydney route is open or Sydney to Brisbane route is open, we will be profitable. As New South Wales and South Australia borders open, we saw an immediate uplift in sales, and we would anticipate the 2 largest travel corridors in Australia, we just would need one of those to open to get to a profitable situation. And if both borders were opened, then we'd be in a scenario where Webjet would actually be making some material returns for our shareholders based on the lower cost base that we have delivered. Moving on to the next slide. And nowhere more so is that pronounced in our performance relative to the market. So I have 2 different metrics to articulate how that shift from off-line to online has occurred and how we have been a significant beneficiary of that shift and how we have outperformed the market. If you look at the graphs at the top of the page, that is a representation of the entire market of flown passengers and you can see that the entire market in blue was down -- was only 3.6%, what it was in May of '19, and 6.2% of June of '20, et cetera. And then you can see on the domestic booking side, how we have performed as Webjet. And clearly we have substantially outperformed the market. So the domestic market in total was only 7.1% of last year's volume over this 4-month period that we have data available for and we were 14.2%. So we have outperformed the market twofold over the last 4-month period. So if you move to the bottom graph. This is a different set of data. This is all travel agencies required to make their bookings through a GDS platform and our historic average is consistent with what it was up until May of this year where we are approximately 5% to 5.5% of all travel agency bookings in Australia. That's a booking platform that includes domestic, Trans-Tasman and international bookings. And the data to hand, as you can see from June through to October, we have increased our bookings through the GDS platform from our historic average of 5.5% to 9%. So we've seen substantial outperformance across every measure. Now the latter data includes international in there. And the first graphs are domestic only. But in both situations, we're seeing a substantial outperformance, which validates the thesis that domestic will be a key driver of recovery and leisure-based businesses are going to be well-positioned in that recovery scenario. If we move on to the next slide. Online Republic has a significant global domestic leisure exposure. Our Motorhomes business, as I'm sure will come as no surprise, is 100% domestic-focused and our cars business is approximately 80% -- sorry, motorhome is 100% leisure-focused and our cars business is 80% leisure-focused. We have substantial domestic cars and motorhomes inventory in the key markets of Australia, New Zealand, U.S.A. and Europe. And while our cars have short lead-time bookings aligned with domestic travel booking patterns, our motorhomes are targeting global travelers looking for holiday alternatives. So again, as we highlighted for our 2 other business units, we've broken it down by monthly sales. And then as a percentage of breakeven in the Online Republic business the breakeven is 37% of calendar year '19's bookings. And we're, again, upwards of 50% to 60% of the target to breakeven as domestic borders open up in Australia, we believe we can get the Online Republic business to at least a breakeven scenario as those borders open up. Next slide. So FY '21 outlook is -- we're operating obviously in a global world that is under significant pressure in the region where I am physically based at the moment. We're seeing second waves of closures. There's renewed sense of some markets going into lockdown and then there are other markets where we're continuing to push through as if nothing is happening. And then there is the other extreme in parts of Asia and Australia where eradication is the preferred strategy. So all of these things create a sense of uncertainty about timing for our businesses and a sense about where we will be with regards to our financial position. What we are focused on is ensuring that we can manage our costs to at least achieve a better outcome for our investors. That's driven primarily by lowering our cash burn than the previously indicated forecast that we gave as of August. Working capital as markets reopen of positive contribute to the improvement in our business. And our strong capital position provides us with strategic and financial flexibility. What we do believe though is that we are a global travel business and are well placed to benefit as domestic leisure markets open up. Leisure and travel is expected to rebound. Obviously at the moment the market is dominated by essential worker travel where there are exemptions to travel. But as markets open, and we can see this in New Zealand already where the domestic travel market is going very strongly and I can see it in the European market where I'm domiciled in that region, where the domestic leisure markets have been the first to open up and when the markets were open people were taking advantage of them. 75% of our bookings at WebBeds are interregional, and our customer mix provides strong exposure to leisure markets with an emphasis on building out our domestic capability. 85% of Webjet OTA flight bookings are domestic and predominantly serve the leisure market. And the Online Republic business is primarily a leisure business where 100% of motorhomes and more than 80% of cars are booked for leisure purposes and both have a strong domestic opportunity. What we will focus on as our long-term goals to ensure that we can deliver outcomes that are satisfactory to all shareholders, return the business to profitability as soon as it's feasible. And to do that, our strategic objectives are for WebBeds to become the goal #1 B2B player. Webjet OTA to increase our market share leadership. And the Online Republic business continues to improve its underlying performance so that all 3 businesses can be substantial contributors to an outcome not dissimilar to what we were able to achieve in calendar 2019. With that, I'll hand back to Roger, and I'd like to echo Roger's commentary earlier thanking the shareholders for their support in what's been an unprecedentedly difficult period. We certainly appreciate the support through the capital raising. We also appreciate the support through the notes issue. And also, as Roger has extended, I'd like to thank the management team for their incredible hard work and dedication through the course of what has been a tumultuous period. And we also appreciate the support of the directors and the input of the directors into the strategic thinking associated with the transformative elements of our strategy as we continue to focus on our business that ultimately will be more successful than the one we came out of calendar '19 with. So with that, I'll hand back to you, Roger.

Yes, John. Thank you very much. Shortly, I will ask Carolyn to read out any questions or comments we've received in relation to the overall business. Can I please remind shareholders and proxy holders to type in the resolution number your question relates to before entering your question on the platform? If you do have questions on the formal resolutions, please enter them on the platform now so we can respond to them before voting. Carolyn, do we have any general questions? If so, can you -- perhaps we'll attack them one by one. And as I respond to each one, you can then read the next one, please.

Thank you, Roger. Yes, we do have a few general questions. The first one is, can you please discuss dividends?

Indeed. I guess simply given the ongoing market uncertainty, we had deferred payment of FY '20 interim dividend until 16, April 2021. Frankly, discussion about dividends is just off the table in the near term. We are focused on returning to profitability, preserving cash and we're not even considering dividends at this point. Thank you, Carolyn. Next question.

We've had a few questions from shareholders asking about the company's focus on staff and retention plans. Could you please discuss the company's approach to retaining staff?

Okay. Well, no doubt there will be some discussion on resolutions 6 and 7, but perhaps, conceptually, what I would say is an absolute key focus of our recovery planning has been around the retention of our staff. They are obviously the primary drivers of our success moving forward. When we were staring at the abyss in March, working out how to restructure the business and develop a new strategy, we sat around the table together and we decided that yes, unfortunately, we would lose some of our people, but retaining the fabric of the business is absolutely vital. This is not a cut-and-reduce-overhead strategy. This is a keep the business together and build a better business strategy. So the theme or the secret sauce that helps us outcompete on every level, and obviously what we're going to cover in Resolution 6 is we've structured a long-term scheme, which is aimed at one thing, which is retaining key talent. We've also invested really a huge amount of energy into supporting the health and well-being of our teams globally during this crisis, which we think will translate into increased retention during a very difficult period. Carolyn, next question please.

Thank you, Roger. The next question is from the Australian Shareholders' Association. As Webjet Limited is the standout #1 short-sold stock on the ASX for the moment at about 18%, what's your message to the shorters.

Well, I'm assuming the question is from Mike Robey, and hello Mike [ glad ] that you are listening. When we met on the 2nd of October, we discussed this. And as I said, we're just focusing on the business. We are focused on returning to profitability, beating our competitors. We have nothing to say to short-sellers. It's none of our business. Next question, please, Carolyn.

It's another question from Mike Robey from Australian Shareholders' Association. Given the geopolitical tension with China, what are the likely impacts on your travel business?

Nothing. Absolutely nothing. In fact that's my answer. Next question, Carolyn?

We have one more general question. While it is positive for the domestic travel industry to have Virgin competing for custom, can you please talk through the impact that a low-cost Virgin business model may mean to the OTA business?

Well, Virgin exists to offer convenience and choice, and we love low-cost carriers because they offer low fares, they stimulate travel, and when you stimulate travel, get more people on the air, it's just good business for us. So bring it on. Next question, Carolyn?

At this stage, we have no more general questions.

Thanks very much. Now as I mentioned earlier in the meeting, there can be a little lag time. So I'm going to give 10 seconds just to see whether any other questions come through. And if not, we'll move to the formal business of the meeting. 10 seconds is quite a long time to stay silent. All right, any other questions coming through Carolyn?

One more has just come through. With other travel companies in greater trouble than Webjet, do you envisage any opportunity to take advantage of this by purchasing assets at cheap prices?

I would never say no. We would never say no. But what I would say is cash preservation and moving into profit are our absolute #1 priority today. If something came along that was incredibly compelling and improved our financial performance, of course, we'd consider but there is nothing on the table today and we would be exceedingly careful. Next question, if there are any.

One more. Are airlines and hotels reducing their commissions?

I'm going to pass to John for that question.

Thanks, Roger. Hotels are not reducing their commissions, as a general rule. The second to none about our business, the vast majority of what we sell is a net rate and as a consequence of it being a net rate, we mark it up and we determine the margin that we take. So we're not as exposed to the commission side. But to answer the question specifically, the commissions haven't been reduced. As you could imagine, in a world in which substantial demand has been taken out, all businesses are clamoring for every sales distribution channel to contribute to their activity. And as a consequence, the issue of commissions is very low on the agenda, whilst the issue of getting people into hotels, in particular, is more critical. On the airline side, as a general rule, we don't get commissions from domestic airlines. So it's a moot point. And international are not flying to Australia at the moment. So it's a moot point on that side.

Thanks, John. Carolyn, anything else coming in?

We have no further general questions, Roger.

All right. Thanks very much. I'll now move to the formal business of the meeting. I'll start by quickly repeating our voting procedures. If you are eligible to vote at this meeting, a polling icon will appear on your screen. Selecting it will bring up a list of resolutions and it will present you with voting options. To cast to vote, simply select one of the options. There's no need to press a submit or enter button as the vote is automatically recorded. You do, however, have the ability to change your vote up until the time I declare voting closed. Proxies have been received from shareholders representing 126,881,037 ordinary shares being 37.43% of the company's issued capital. The proxy results already received for each resolution will be displayed on the screen as we move through each resolution. Before we move to the resolutions, the first item of ordinary business is to table and consider the financial report, the directors' report and the auditors' report for the company for the fiscal year ended June 30, 2020. Stephen Rush, our audit partner from Deloitte, is available to answer questions. If you have questions or comments on these reports, please enter it on the platform now, so we can respond to them. Carolyn, do we have any questions?

Roger, we don't have any questions at this stage on the financial statements and report.

We'll just give it a few more questions to see whether -- a few more minutes, seconds to see whether any come through. Any questions, Carolyn?

No, Roger.

Okay. Now we move to the resolutions to be voted on today. All resolutions will be voted on by a poll. And I'll give you ample warning before closing the poll after the conclusion of the final item of business. So we'll run through the resolutions now, and then we'll give you some guidance on how the poll will be conducted. Resolution 1 is to consider and, if thought fit, pass the following resolution as a nonbinding ordinary resolution that the remuneration report as set out in the annual report for the financial year ended June 30, 2020 be adopted. Please note the key management personnel of the company, including directors and their closely related parties, are excluded from voting in any capacity on this resolution as per the notice of the meeting. However, as Chairman of the meeting, I will be voting undirected proxy votes where I've been appointed as proxy in favor of this resolution. I draw your attention to the proxy votes received in the table on the screen. We've received 125,220,582 For which represents 98.69% and Against 924,217 or 0.73% against. If you have questions or comments on this resolution, present to them on the platform now so we can respond to them before voting. Carolyn, do we have any questions on this resolution?

Yes, Roger, we have a question from Australian Shareholders' Association. If you have significant Against vote on any matter, will you provide us with a background as to why as far as you know, please?

Yes. Certainly. Well, in respect of the remuneration report, I would say we have overwhelming votes for. So I don't see that this necessarily applies to the rem report but to the extent that we have significant votes against any other resolution, we will, of course, be very happy to answer questions. Carolyn, any other questions?

Not at this stage, Roger.

Okay. I now move that the members consider and have thought fit to pass Resolution 1 in the notice of meeting to adopt the remuneration report. I will now put the motion to a vote as an ordinary resolution. You're invited to lodge your vote for Resolution 1 by using the polling icon to reiterate. In order to cast your vote, simply select one of the options. There's no need to press a submit or enter button. You have the ability to change your vote until I declare voting closed. We now move to Resolution 2, which is also an ordinary resolution. Clause 58.1 of the company's constitution requires that at each Annual General Meeting, 1/3 or the number nearest to but not exceeding 1/3 of the directors must retire from office. The Managing Director is exempt under the company's constitution from the requirement to retire by rotation. Don Clarke retires at this AGM and being eligible for reelection will be seeking reelection as a director today. I now move that Mr. Don Clarke, a director retiring in accordance with the company's constitution and being eligible, be reelected as a director of the company. Don's background is set out in the Notice of Meeting and rather than reading it all to you, I'll now ask Don to say a few words in support of his reelection. Over to you, Don.

Thank you, Roger. I'm personally delighted to again be able to stand for reelection to the Webjet Board. I suspect and almost certain this will be the last time I do so. Having had a long association with Webjet both as a professional adviser and as nonexecutive director, I'm very confident that I am well placed to continue to make a meaningful and positive contribution to the Board and to the company. Being aware of the history of the company is important. And certainly having that understanding as to where we've come from is integral to moving forward. If reelected, I look forward to using my legal, governance and practical skills to continue to assist the Board, which, in my view, has done an exceptional job over the years and particularly in the last 6 to 9 months with the pandemic. I'm very confident that the company moving forward will be in good hands and that with my assistance, we can certainly do it in efficient, ethical and responsible way. Thank you, Roger.

Thank you, Don. And before we move to the proxy votes, I'd just like to add, Don has been an exceptional Director for a number of years and delivers a very meaningful contribution around this Board table. Would shareholders please note that details of the proxy forms -- proxy votes are now shown on the screen. And we have 126,109,386 votes For, which is 99.15%, and 0.27% Against. If you have questions or comments, please enter them on the platform now. Carolyn, do we have any questions?

Roger, we don't have any questions on this resolution at this stage.

All right. Thank you. I'm going to count to 10, and then we will move on. If there are no further questions, I will now put the motion to a vote as an ordinary resolution. You're invited to lodge your vote for Resolution 2 by using the polling icon. At the risk of repeating myself, in order to cast your vote, simply select one of the options. There's no need to press a submit or enter button, and you can change your vote until I declare voting closed. We move to Resolution 3, which is an ordinary resolution. As I mentioned in respect to Resolution 2, Clause 58.1 of the constitution requires 1/3 or the number nearest to but not exceeding 1/3 of each directors to retire from office at each AGM. The Managing Director is exempt. Brad Holman retires at this AGM, and being eligible for reelection, will be seeking reelection as a Director today. I now move that Mr. Brad Holman, the Director, retiring in accordance with the company's constitution and being eligible, be reelected as a Director of the company. Brad's background is also set out in the Notice of Meeting. I'll ask Brad to say a few words in support of his reelection. Brad?

Thanks, Roger. In respect to Resolution 3 and with the support of our shareholders, I also seek to be reelected as a Director of Webjet. I have been on the Board of Webjet for 6 years and currently chair our remuneration and nomination committee and I'm a member of our audit committee. In support of my nomination to continue to serve on the Webjet Board, I would offer that I have over 25 years of career experience working in and providing services to the global travel industry. As a senior level executive, I've had significant experience in building and leading global travel and technology organizations and delivering results in dynamic and challenging environments. This has included launching new businesses in Asia, Europe, Africa and the Middle East, as well as acquiring existing businesses and establishing joint ventures in these same markets. I would also note that as part of my previous industry experience, I've had to deal with the business impact to travel from previous world events such as 9/11, SARS and the Boxing Day Tsunami. I believe this experience means I'm well placed to support management as it works through this recovery, while at the same time being able to balance these short-term needs while safeguarding the long-term governance and viability of the Webjet company. As a result, I wish to apply my skills and experiences to continue to serve Webjet, its shareholders and staff as we navigate through COVID-19 and I seek your support in voting Yes on Resolution 3 for my reelection as a director of the company. Thank you, Roger.

Thanks, Brad. And before showing the proxy votes on the screen, I would again reiterate the strong contribution that Brad makes to Webjet around the Board table. Would shareholders please note the details of the proxy votes which are now shown on the screen. And we had 126,117,493 For, which is 99.15% For, which is more or less identical to Don, not that it's a race. Against, we have 0.25%. If you have questions or comments on this resolution, please enter them on the platform now so we can respond to them before voting. Carolyn, do we have any questions on Brad's reelection?

No, Roger, we don't have any questions at this stage.

Thank you. We'll just pause momentarily and see if there are any questions. I'll now put the motion to a vote as an ordinary resolution. You're invited to lodge your vote for Resolution 3 by using the polling icon. To reiterate, just select one of the options. You don't need to push the button and you can change your mind before voting closes. We will now move to Resolution 4, which is an ordinary resolution to approve the ratification of issue of shares under institutional placement. By way of background, in April 2020 the company raised approximately $346 million through the issue of 203.4 million new shares at a price of $1.70 per share. The proceeds have been used to strengthen the company's balance sheet, given the continued impact of COVID-19 and the associated government restrictions impacting the travel industry globally. The equity raising included an institutional placement of 68 million new shares to sophisticated and professional investors, an issue of 66 million shares to sophisticated and professional investors under the institutional component of the entitlement offer and an issue of 69 million new shares to investors under the retail component of the entitlement offer. The institutional placement of 68 million shares was issued by the company under the company's 15% annual securities issuing limit set out in Listing Rule 7.1. The company is requesting shareholders to ratify the issue of the institutional placement shares for the purposes of Listing Rule 7.4. This will enable the company to retain the flexibility to issue new securities within the 12-month period following this meeting up to the 15% limit in Listing Rule 7.1 without needing to seek shareholder approval. As you've heard today, the global travel industry is facing unprecedented challenges as a result of this pandemic, and the company is seeking flexibility from its shareholders under this resolution so it can react quickly to changing market conditions and maintain a strong balance sheet in order to deliver value to shareholders as the industry seeks to recover from the pandemic. Please note that the notice of meeting sets out the voting restrictions for this resolution. Would shareholders please note that details of the proxy votes are now shown on the screen. We have votes For 102,918,627, being 98.69%; and Against 0.6%. And I'd encourage you if you've got questions or comments on this resolution, please enter them on the platform now. Carolyn, do we have any questions? And if so, could you please read out them?

Yes, Roger, we have a question from the Australian Shareholders' Association. I understand the concern you had at the time in being able to find an underwriter for the institutional SPP capital raising. But it appears that the $1.70 was in hindsight well off the mark. The lack of a PAITREO model meant many retail shareholders were diluted substantially more than was necessary. Can you give us an assurance that you will use the nondilutive PAITREO method for future capital raisings given that you will have much more time to plan them?

Thanks, Carolyn. And Mike, as we discussed on the 2nd of October, when your share price is in free-fall falling 10% to 15% a day, and no one wants to underwrite an equity issue for you and a pandemic is sweeping the world, you don't have the luxury of choosing the type of raise you do. And as you recall in our discussions, we worked extremely hard to hit the equity markets against private equity to come up with the best available outcome. So I don't accept that $1.70 was wide off the mark at all. It was what we could get at the time. Look, we're advised that over 90% of ASX 200 company rights issues have been non-PAITREO. And we've talked about this the last 3 years, every time we've met. We're advised that PAITREO is best for large liquid companies. And our advice at the time and now was the discount would have actually been larger had we gone PAITREO. As to what we do in the future, well, I can tell you none of us have appetite to raise equity right now after the year that's been, but the structure we use in the future depends on time pressure, are we making an acquisition. I'm not implying anything from that statement. It depends on liquidity and market cap at the time. It depends on pricing and underwriter readiness. It would just be unwise to make a future commitment at this point, but we appreciate your question, and we're very happy to continue that dialogue offline. Carolyn, any other questions on this resolution, please?

Not at this stage, Roger.

We'll give it a few seconds. Okay. I now move that the members consider and have thought fit to pass Resolution 4 in the notice of meeting to ratify the issue of shares under the institutional placement. I'll now put the motion to a vote as an ordinary resolution. You're invited to lodge your vote for Resolution 4 by using the polling icon. Again, you simply select an option. You don't need to push any further buttons, and you can still change your mind. Moving then to Resolution 5, which is an ordinary resolution to approve the issue of new equity-settled notes to replace the existing cash-settled notes, which were issued to institutional investors in July. By way of background in July 2020, shortly after balance date, the company raised EUR 100 million by way of an issue of cash-settled notes. This debt raising was undertaken to improve the capital position of the company as it continued to navigate the challenging operating environment caused by travel restrictions and the pandemic. As the company didn't have any available placement capacity at the time to permit the issue of equity securities under Listing Rule 7.1 at the time, these notes were structured to be cash-settled only making it debt security and not an equity security for the purposes of the listing rules. The company now seeks shareholder approval under Listing Rule 7.1 to permit the company to replace the cash-settled notes with new convertible notes having a face value of EUR 100 million and which will comprise equity securities, having all the same features as the cash-settled notes but with settlement of the conversion of the convertible notes to occur by the issue of new Webjet shares rather than by the payment of cash. Replacing the cash-settled notes with equity-settled notes will give the company greater flexibility and will ensure that it's better placed to withstand the impact of the pandemic on its cash position, while also enabling it to take advantage of improved trading conditions once travel restrictions ease. If Resolution 5 is approved, the replacement of the cash-settled notes with the equity-settled notes is expected to occur by the company renegotiating the terms applicable to the cash-settled notes. Such terms can only be amended with approval of a majority of the holders of the cash-settled notes. And it's important to note that these securities will only be replaced if the holders of the cash-settled notes approve the replacement. Please note that the notice of meeting does set out voting restrictions for this resolution. Would shareholders please note the details of the proxy votes are now shown on the screen. We have 114,494,329 votes in favor, being 98.75% and 0.6% against. If you have questions or comments, please enter them on the platform now. Carolyn, do we have any questions? And if so, can you read them out?

We don't have any questions on this resolution yet, Roger.

Thank you. We will pause for 10 seconds. I now move that the members consider and have thought fit to pass Resolution 5 in the notice of meeting to approve the issue of equity-settled notes to replace the existing cash-settled notes. I'll now put the motion to a vote as an ordinary resolution. You're advised to lodge your resolution -- your vote for the Resolution 5 by using the polling icon using the procedures I have already outlined several times. We will now move to Resolution 6, which is an ordinary resolution to approve Webjet's new long-term incentive plan. From this point, I will refer to it simply as the plan. By the way of background, Webjet's senior executive team and employees, as we've been saying through this meeting, have been working tirelessly to place the company in the best possible position to deliver value for shareholders when the travel industry recovers from COVID-19. And as we've said, fixed remuneration has been cut, FY '20 short-term incentives have been canceled, as have all long-term incentive equity grants. Recognizing the sacrifices the executive team have made to assist the company and to assist in retaining personnel who are both sought after and will be essential to driving the business forward, the Board proposes to introduce a new long-term incentive plan for senior executives and key personnel of the company. The Board considers the plan to be critical to ensuring Webjet retains key talent within the company as the global travel industry recovers. The grant of performance-based securities will play an important role in incentivizing our team to generate long-term shareholder value. This is an equity plan, not a cash plan, and it will align management more closely with shareholders. Importantly, it will provide a reward for the effort put in by the management team in negotiating the company through one of the toughest environments ever faced by the travel sector. The plan is an employee incentive scheme. For the purposes of Listing Rule 7.2, shareholder approval is being sought for the issue of options or rights under the plan to employees over the 3-year period from the date of the Annual General Meeting. A summary of the key terms of the plan was included in the Notice of Meeting. If Resolution 6 is approved, any issue of options or rights under the plan within the 3-year period from the date of the Annual General Meeting will be treated as having been made with the approval of shareholders for the purposes of Listing Rule 7.2 and consequently, the issue of those options and rights will be excluded from the calculation of the maximum number of new equity securities that can be issued by the company under Listing Rule 7.1. There are also voting restrictions in respect to this resolution. So would shareholders please note the details of the proxy votes are now shown on the screen. We have 121,100,742 or 96.55% in favor, and 2.92% against. If you have questions or comments, please enter them on the platform. Carolyn, do we have questions on Resolution 6?

No, Roger, we don't have any questions on this resolution.

Thank you. We'll just give it the customary 10 seconds. I now move that the members consider, and if thought fit, pass Resolution 6 in the notice of meeting to approve the Webjet long-term incentive plan. I'll now put the motion to a vote as an ordinary resolution. Please follow the procedures, I've already outlined several times, using the polling icon. We now move to Resolution 7, which is an ordinary resolution to approve an offer of options to John Guscic as Managing Director of Webjet under the long-term incentive plan, which was the subject of Resolution 6. By way of background, as announced in September 2020, the Board has resolved to make a grant of 4.5 million options to John under the company's long-term incentive plan following the recommendation to the Board from the Remuneration and Nomination Committee, which comprises 3 Nonexecutive Directors and subject to shareholder approval under this Resolution 7. Informing its recommendation to the Board to make the grant, the Remuneration and Nomination Committee considered the importance of John's continued service to the company, especially as we continue to cope with the market conditions imposed by the pandemic. John's long-term incentives are now significantly out of the money due largely to the impact of the pandemic. And as a consequence, the desire to ensure that John continues to be incentivized to deliver long-term shareholder returns. And thirdly, ensuring that this remuneration is competitive and aligned with market remuneration for comparable roles in the industry. A summary of the key terms of the options proposed to be granted to John was included in the Notice of Meeting. The company does not intend to offer him any additional long-term equity incentives under the plan or otherwise during the 3-year vesting period for the proposed options. Listing Rule 10.14 provides that shareholders of an ASX-listed company must approve the issue of securities to a director under Employee Incentive Scheme. Please note the notice of meeting sets our voting restrictions on this resolution. Would shareholders please note that details of the proxy votes are shown. We have 83,436,296 votes or 67.04% for, we have 40,345,177 or 32.43% against. I am quite confident there will be some questions. So if you have questions, please enter them on the platform now. And I will be handing these questions over to Brad Holman as Chair of the Remuneration and Nominations Committee. Carolyn, do we have questions?

Yes, Roger, we do have questions. The first one is, John Guscic's compensation level seems high relative to the revenue and market capitalization and also compared to competitors. The exercise price for his long-term options seems low. Can you please justify the remuneration package and LTI proposal for Mr. Guscic?

Over to you, Brad.

Thanks, Carolyn, and thanks, Roger. Firstly, to the question of compensation. The current fixed annual salary for Mr. Guscic was negotiated during the latter part of 2019. For context, as the Chair has previously mentioned, since COVID-19, Mr. Guscic has taken a 60% base salary cut, received no short-term incentive and relinquished his previous existing long-term incentives. The substantive uplift to John's base salary, which was announced on the 20th of January 2020, reflected numerous factors. Firstly, the fixed annual salary component payable to Mr. Guscic had not been reviewed or changed since the 1st of July 2016. During those 3 years, the period the business went through a significant growth phase that dramatically increased the geographic spread and complexity of the company's businesses. Some of the data points that were considered were the company's total transactional value, TTV, which increased from $1.6 billion to over $3 billion over that period, EBITDA increased fourfold from $36 million to $124 million, and our market capitalization went from $640 million to $1.2 billion. Additionally, the Board considered remuneration benchmarking data on a global basis, the surrounding market conditions and sentiment at that time. And of course, looking at the trajectory of the company's growth and our strategic objectives and the market demand for senior executives with a proven track record of building profitable businesses, all of which came into determining Mr. Guscic's compensation. To the second part of the question regarding the long-term incentive. As previously stated, the Board's clear view is that Mr. Guscic is the right leader to see the company through this difficult period and that we need to put appropriate incentives in place to retain John and to deliver long-term shareholder returns. Therefore, we negotiated a new long-term incentive retention package, prior to releasing the financial year '20 result, with John comprising options to acquire fully paid ordinary shares in Webjet, which vests in 3 equal tranches over the next 3 years subject to his continued employment and Webjet achieving certain share price targets. This long-term incentive opportunity of 200% of fixed remuneration when converted to an annual vesting split is the equivalent of approximately 66% of fixed remuneration that is eligible to vest each year. This is lower than the majority of ASX companies with opportunities equal to 100% of fixed remuneration or more. I would also note that Webjet intends to make no other grants to Mr. Guscic in the next 3 years. Additionally, the exercise price was calculated as the 30-day volume weighted average share price of shares to the 19 August, 2020. This is considered consistent with market practice. The volume-weighted average share price for this period was determined at $3.08. The Board formed the proposed share price growth hurdles based on the share price experience of Webjet since the initial impact of COVID-19 and the company's expected future growth, noting, however, significant operational challenges going forward due to border closures for both domestic and international that Webjet's management cannot control. As Roger mentioned earlier, the calculation and value of these grants can only be assessed at the vesting point based on the share price performance at that time. So with the expected volatility in our share price over the next 3 years, the growth target set for John's long-term incentive are considered challenging yet achievable for the company. Thank you, Roger.

Thanks, Brad. Do we have further questions, Carolyn?

Yes, we have one from the Australian Shareholders' Association. It says, we understand the volatility of share prices at the time of setting the base price for the CEO LTI plan. However, many of our shareholders heeded the advice not to panic and stuck with their shares. Your LTI price was set at this time and the first 2 years' worth of awards were already in the money within days of being set when, like shareholders, you could have waited out the panic. We believe these price targets are too easy: Year 1, $3.39; year 2, $3.73; and year 3, $4.10. Today's share price is $3.94.

Well, before I pass this question to Brad, I will note the RNA of calling out Webjet for being the most shorted stock on ASX while equally complaining about the strike price of the options, which won't actually vest for some period of time. Brad, would you like to respond further to the question. I think you may be on mute, Brad.

Thank you, Roger. Sorry for that. I'd only point out that, as mentioned earlier, we don't have the benefit of hindsight or turning back the clock and having a predictive ability as to the share price going forward. The calculation and value of these were assessed, as said, leading up to the release of our results and the growth targets at that point in time were considered challenging yet achievable for the company. And the other point I'd make, of course, that these can only -- the calculation and determination of the value of these can only be assessed at the vesting points as they occur and we do not know nor does the Australian Shareholders' Association know what the share price for Webjet will be at those points in time going forward. Thank you, Roger.

Thank you, Brad. We'll give it our customary 10 additional seconds to see whether any other questions come through. Carolyn, do we have any other questions on Resolution 7, please?

No, Roger, we don't.

All right. I now move that the members have considered and have thought fit to pass Resolution 7 in the notice of meeting to approve the Managing Director's participation in the long-term incentive plan. I will now put the motion to vote as an ordinary resolution. You're invited to lodge your vote by using the polling icon, using the instructions that we have relayed to you in respect of the previous resolutions. Ladies and gentlemen, that concludes all of the resolutions to be voted. Please ensure that you have cast your vote on all 7 resolutions. I'm going to provide shareholders with a minute to finalize their voting. We remind you that your Board strongly recommends that you vote for all resolutions. And while votes are being finalized, we will also quickly check that there are no outstanding questions. Computershare advises us that a minute online without talking seems like an eternity. But if -- I will check and see whether there are any other questions. And if not, we will go quiet for another 45 seconds. Carolyn, do you have any other questions?

Not at this stage, Roger.

Thank you. Thank you, ladies and gentlemen. I now declare the poll closed and formally charge Nigel Bulling as Returning Officer to count the votes. After the votes have been counted, the results of the poll will be released to the ASX and will also be displayed on the company's website, webjetlimited.com. That concludes our proceedings today. My fellow Directors and I would like to conclude by thanking Webjet's shareholders for their continuing support. I declare the meeting closed.