Thanks, everybody. Thanks for your time today and welcome.

Oh, just everyone's copying in there. Thanks, everyone.

Thanks for your time today and welcome to the Intelligent Monitoring Group, IMB, FY 2024 full year results. I'll throw to Dave to kick us off.

Introducing Dave Cavanagh, our CFO of Intelligent Monitoring Group. Over to you, Dave.

Great. Thanks, Dennison.

Thanks, everyone, for making the time, especially with all the competing companies that are going out today. Really I'm just going to focus on two slides today.

The first one is this one, then the last slide after Dennison talks is slide 22, which is around sort of cash and how that sort of moves around in the business. I think at a first level I'm just going to talk through each of these key tiles and then pass over to Dennison.

First up, revenue up sort of 16% year-on-year, and that's been really positive. If you look at sort of what's driving that, we've had an increase in our installations and then also an increase in our sort of services side of the business, which you can see through the notes in the annual report.

There's also a highlight that we've got about 53% of recurring revenue running through the business. You can sort of see later in the presentation, New Zealand, whilst revenue is up, had a tougher gross margin sort of position, EBITDA position, but the actual underlying business, the revenue and what the guys have been able to achieve has been quite positive for the year.

Underlying EBITDA up 14%, and so if you think about this, we, again, had positive momentum in our underlying businesses pushing forward. I think last year we were sort of talking just under about $38 million.

There are some one-offs that are taken out of that, which we've split out a bit later, and they come to about $11.5 million. They're sort of focused on old receivables that we inherited as part of the business, customers and we're just working through a structure on how to make sure that that is not repeated going forward.

Then also some acquired stock that was written off, along with the restructuring and M&A activity, which has been a big part. In terms of adjusted underlying NPATA, well, I suppose this is the big one that we're sort of the proudest of for the period, it's been a significant increase year-on-year.

A couple of really big things driving that, which are below the EBITDA line. The first one is the financing cost.

You'll see in the P&L financing cost come down from about $19 million to about sort of just around eight. There's been a huge effort from an old punitive financing structure to a tier one sort of Australian-based position going forward.

Then also you'll see last year we had about $6 million, $7 million worth of tax impost running through the business. Because of all the businesses we've acquired, because of all the potential careful losses and the flow through the accounts, you'll see in the expense item that that's effectively zero this year.

You've got the combination of underlying business up, finance costs down, tax down, and that's what's really driving that cents per share underlying position. That one, effectively, the way that we got that number, and there's some notes down the bottom, is you take out the amortization.

The reason we do that is that you don't get a tax deduction for it, and it's an allocation of acquired intangibles that are amortized through the business. In terms of operating cash, again, look, the big thing is, does this business make money, and the next two tiles are a big indicator of that, is that operating cash is up sort of 100%, $22 million for this period.

There is a little bit of a working capital impost as well running through the business, and we acquired some working capital during the year, but there is, on top of that 22, there's some working capital that ran through the business as we take on more activity. Then the other thing is that we obviously had a whole bunch of one-off costs for M&A, restructuring, and stuff that's also embedded in that $22 million.

Really excited about that side of the business. Then ultimately, how much money does this business make?

If you look at operating cash, you take off your CAPEX, you take off your AASB 16 leases, then this business actually generated about $8.1 million worth of cash, which, compare that to this time last year, it was a negative $4 million number. Again, I'll talk through this on slide 22 right at the end.

Then the last sort of big thing is leverage within the balance sheet. We drew down debt of about $35 million in May to pay for the Wormald acquisition.

We took the full freight of the debt impost going up from sort of 85 to 120, $120 million with a NAB facility, but then we've only got one month of earnings from Wormald in here. You'd expect that that would continue to delever as we get the annualization of the Wormald acquisition and Redwall acquisitions flowing through the accounts.

That and, again, that'll change as we do the UK acquisition at a later point in time. I suppose on all metrics, up and to the right, which is positive.

I'll touch on the cash a bit later in the presentation, but I'll hand it back to Dennison.

Great. Thanks, Dave.

Just turning to the next slide, Shanene. Versus guidance, I think it's important.

So, working our way as Dave said, from EBITDA down to to EPS, EBITDA at the bottom end of the range, it does include, 1 month of Wormald, but still just above the the bottom end there. Just to call out, New Zealand was our, I suppose, issue first part of this year, which we feel like we've well remedied now.

The first part of it was actually just a currency impact and, we've been cruising on for 3 years, at a very stable A dollar-New Zealand dollar rate that stepped down. I think you'll see that in other companies, or you will see that in other companies, just a translation effect of about half a million.

The other thing is, and I'm I'm keen to make this point, I I through this journey, I keep emphasizing we are walking and chewing gum, we did actually put a million dollars of what I'll call growth OPEX back into the business around ADT Guard commercial team. We introduced, David Medhurst, who'd come over to the market about a year ago, which hasn't yet returned, it's I guess its OPEX cost, did weigh essentially on the short-term results, but we're very, very, happy to have done it, and we think it's a key part of our go-forward.

Then the other part, there is just New Zealand itself, which as we know had that weak first quarter, which is is remedied as we've gone through the year, which we'll get to. As you flow down, though, what we are really happy about, is that, NPAT level.

We are trying to move focus, effort, energy, and everything we do to that to that actual net profit of the business. We do have to adjust for amortization because it is a non-cash charge, and we don't have to invest to return it, but it is a feature, given the way we've built this business up.

We do have to acknowledge, the, one-offs as well, which we'll we'll detail later. This year, primarily the biggest part probably just being the M&A costs of, Walker/Wormald, capital raise, and then of course ADT UK.

We think, the way I've framed this is this is setting a a really solid base. I think, we look at these numbers and these actuals as being a really, really, solid base to which we can work off, for us to forecast off, for us to talk forward.

That regard, just moving to the next slide, Shanene. We we're keen to, sort of, I suppose, impart upon that, so that there is clarity.

We're not intending to give guidance today. We will do that as we always do at the AGM.

We are, I think it's important that people that follow us understand that this company's going to have significant growth at a headline level over the next 2 years. This year is going to be driven, by a combination of, Redwall and Wormald, what we call Project Walker, being in the business for a full year.

We had 1 month in FY 2024, which will be a full year in FY 2025. We've put the pro forma bridge there, which is public and what we've disclosed before.

The UK, ADT UK, which we are expecting to settle on the 1st of December, we've just received regulatory clearance, this week, to push forward, were leading to a pro forma number. Again, to look for a base here to think about IMG Group off, if we do nothing else than just execute these the acquisitions of which we've done Project Walker, and UK is to come in December, we have a business that, we think at a baseline level today is a sort of an 8 cents per share EPS business.

Just turning to the to the quickly through the, rest of the presentation. In terms of highlights and and just to look at the year, I think, it is it is the case that I think the thing that makes me and and probably the board and those that have been with us on this journey happiest is actually to see the underlying, performance of the business, coming to pass.

Ultimately, we have had to and have done a lot to build this business to where it is today, but it's all been on the basis that we're building a business, not just sort of acquiring things. It's nice to see, and we feel validated to see, that actually starting to come through the business.

In particular, you can see that in the revenue growth line, and we'll dissect that a bit in a second, cash flow and across the board in all metrics. To call out this year, we had, WAPL, being, Western Advanced, join us, and BMP.

Western Advanced added to our commercial business in terms of giving us true expertise and specialized expertise in oil and gas. BMP was very much part of that core ADT Guard commercial strategy, and has been, really fantastic, both of those businesses, and and and adding into our business and adding into the team.

I guess highlights the remote video monitoring gaining traction. Our, monitoring the monitoring capabilities that come off this, ADT Guard product have allowed us to apprehend over 75, in fact, it's 77 this morning, 78 this morning, I think, after, overnight activities, of offenders with the police.

Something that, has not and does not happen in the intrusion security alarm industry globally anywhere. We've continued to invest.

We've continued to invest in technology, people, and, we continue to try and strengthen our business so that we can become a really enduring, and, important, industrial business. Further than that, we also did a lot of work in New Zealand over this year.

Redwall, was is directly, in, I'm really proud to have add the ADT add to is the ADT New Zealand business. It gives us a much stronger commercial enterprise in New Zealand.

If you track our journey, the success we're seeing in Australia today was born off us really re-engaging in commercial security first and then driving it down and across the different market sectors. Redwall allows us to do that in New Zealand and is already paving and helped us pave on top of the work we've done in the ADT NZ business itself, widen and, increase the opportunity set in that commercial business.

Then, further, to give mass to New Zealand, but also, to follow our monitoring pathway and expertise, wider the the acquisition of Wormald, in New Zealand. I think Wormald, was, is a really landmark acquisition for us.

It's a very old brand. It's a very proud brand.

It's a very highly esteemed business historically. We are getting the opportunity to to essentially put a a fresh bit of paint on it, re-engage the team.

I'm just absolutely delighted to see how they've done. Those two things had us on good step for what would have been a, really impressive, I think, coming '27 year, and then of course, back right at the end of the financial period, we announced that we are making the bold step into ADT UK, into the residential market there, a very, tight market segment that we've focused on, but it is giving us the ADT brand in the UK to, which will, potentially, over time, create options for us depending on how we go.

Significant year in FY 2024. Just jump in the next slide, Shanene.

Now, skip through the rest of them. In terms of who we are today, what what does this all really mean?

I'd I'd characterize this this way. We've got we've got a really strong financial profile, and notwithstanding we are going to be taking on more debt again to go, into the UK, we are very comfortable inside the gearing ratios that we are in.

We stand, relatively undergeared to our industry. If you take the private, private equity and other public companies, we're probably in the middle middle of the public companies for our space globally.

Very comfortable, position. We've got a scaled platform.

This last couple of years looking backwards has been all about building out our platform in Australasia, understanding how it works, enabling it, refining the customer propositions, and now driving forward. We've got a we've got a highly technical and specialized workforce, which is the, part of the secret to be able to drive and unlock this growth, is the people and their ability to deliver and and to deliver on scale and with large customers across a broad network.

That's giving us, coverage, that links back into our, strategic assets being our, four, monitoring rooms in Australia. In terms of characterizing us, that's how I'd do it.

In terms of the way we go to market, Shanene, just the next slide, if you look at us, effectively, we've got four operating businesses today, or brands, I suppose, you'd say. ADT, Australia, New Zealand, and, of course, shortly, in December, the UK; Signature Security, which is our partner brand; Wormald, which is our direct fire brand, which we, monitor through our, monitoring stations; and IMS, which is our wholesale monitoring, security brand and wholesale monitoring brand.

Just jump to the next slide, Shanene. Just breaking down the performance a little bit, we did this last year, too, there is a tale essentially of, I suppose, three different parts to build up to the result today.

There's Australia, New Zealand, and then the, effect of acquisitions in the in the EBITDA and the revenue. At a group level, as we've called out, 14.5% growth, the the the part that I guess makes us most happy is that step-up in organic growth in Australia.

I think we were tracking sort of around the 8% growth over the last 18 months, last financial year was about 8.3%, 8.4%, if memory serves. The first half, the half before that, was about eight the same sort of range, mid-8s.

We've seen this year's financial, organic growth in Australia step up to 12.5%, which has been driven, pretty significantly by that commercial rebuild and pipeline, which we'll talk about shortly. We've got an acquisition earnings effect, these are just simply the the earnings impact of the businesses that we've bought, coming into the EBITDA line.

Then, of course, we've got the New Zealand business, and to to to just reiterate quickly what has happened in New Zealand, at the start of this year, the first quarter, we got a timing mismatch. It was a shallow commercial book of business in New Zealand is as distinct to the wide and diverse book we have in Australia.

We had a timing mismatch between the end of a major customer long-term piece of work and the start of another major customer's long-term piece of work. One was Ministry, of, MSD in New Zealand, and the other start-up is the Auckland Airport domestic terminal, which is a lot of work over many years there.

That caused us to show a gap down as we kept our expenses, but the revenue dipped back and came back. I think the important thing to note is we did that did form part of our understanding as to why we progressed our strategy around Redwall and bought Wormald in to give New Zealand mass, and then more than that, we did also go through some management change and refocusing, just around skills, particularly, more than say people.

We've seen that come through in the second half with the second half being up 42% on the first-half deliveries. Albeit it weighs on the full-year result, the actual direction of of what's occurred there and and where we're actually at today versus where we're at at the bottom of the first quarter are very different places.

We're happy overall with that. Next slide, Shanene.

Again, just to keep coming back to how we end up here today and and where we are today and what we are trying to do, so, characterizing it a different way, the first, couple of years of journey for IMG back to essentially when I took over as MD in 2022, it was to build the platform. That enabled us to learn the lessons around, a monitoring platform, enabling it for the modern world and being able to widen, the services that it offers, using available technology, but having to, to be really open to enabling it and bringing it into our business.

We've used that platform in phase two to enter much larger markets, which we'll talk about shortly, and then this third phase, where we've stepped into UK, is to replicate internationally. Now, I would pause and say that's a little bit grandiose, we've gone to the UK by opportunity and strategic, that's not to say that we're looking to replicate our entire IMG platform on a on a much wider scale than this.

We fully acknowledge that it's a big step for us, and we are going to be very focused, over the next, couple of periods and years to just prove up what we have acquired there, which is a very stable business we'll talk to shortly. Just next slide, Shanene.

In terms of what we're really doing, we're talking about widening the services. I think of it this way, the Australian security market, just to pick on that market, we have a slightly wider TAM now also with the fire, piece being added in New Zealand, but the the overall market's about $13.6 billion if you use IBIS numbers.

If you look at pure electronic security in a historical context, that's about a $2.3 billion, $2.4 billion market. By using technology, by making investments, we're made to put the platform in place and now by leveraging it into services like ADT Guard, and like the broad national network in our commercial business and the use of technology we are doing there for enterprise, we're able to broaden our our market opportunity, our total addressable market, significantly.

From what was historically in the electronics a $2-odd-billion market, we see it being a $9 billion market, and it's a lot to do with, human replacement. It's using technology, it's a positive beneficiary, I suppose, of the world we live in and, in particular, around AI and the cloud.

That that's sort of how I would characterize it. In terms of the opportunity, if you look purely at the intrusion space and turning that into a from intrusion being reactive to guarding being proactive, our starting market is 14.1 million premises, they consist of commercial and residential properties.

That is very low penetration, particularly on the residential side in Australia to elsewhere in the world. We think the solution sets we're bringing today, again, particularly ADT Guard, will lead ultimately to much higher penetration, given the quality of the service and and the effect that it is having.

Just jump to the next slide, Shanene, please. In terms of those two drivers, I've said using technology to widen that total addressable market, the two key areas being commercial security.

We embarked on this journey when we bought ADT in AU, New Zealand in 2023. We had no pipeline for growth at that point, and that business had largely been disregarded and shut down, by prior owners.

We have bought it back to life, engaged, the workforce we have, we've hired a number of people, we've also added to that business with acquisitions, and we've seen the positive impact of that with or add without also add almost no marketing spend, just simply reputation, engaging in the market, a pipeline that's gone from $36 million at the end of the first quarter of this year, again, it was I think $2 million in the year that, we took over, through to, ending this period at $72 million. Growth rate there over the period about 26% quarter-on-quarter.

We wouldn't expect that to continue by law of large numbers, but we are showing, trying to show here really, what is driving that underlying business in that 12.5%, organic growth rate that we've reported in Australia. The second key driver for us, just on the next slide, Shanene, is the ADT Guard bit.

At the moment, the really, powerful impact on the business in terms of the economics and the reported profitability is that commercial piece. The prospective driver of this business for the for the long term and the the mass market application is this video guard business.

We started that just over a year ago, too, with no sites initially, and we exit this year now with over 1,000 sites monitored, with ADT Guard, around Australia. I think a couple of key points to that, I've mentioned it already, we've had over at to the end of the period, reporting against here, 75 arrests, with the police.

That is something that never happens, or seldom, if ever, has ever happened off an intrusion alarm, an alarm where it's triggered when something is happening, you don't know what, but it's happening. In our case, we are watching before an event happens and are able to respond and actually activate the police very quickly to react, hence why we're getting the arrests.

More and better than that, we've deterred over 15 events, on average every month off the base that we have today, and by our reckoning, we've probably saved Australians, or sorry, our customers over a million dollars in claims, so far off this what is very small base of customers, at 1,000. In terms of our overall business at the moment, it represents, coming up to about a 1% of our customer base, sort of speaks to the opportunity as we, continue to, drive this and look to drive this out into our business and I ultimately into our P&L and drivers.

Next slide, Shanene. Then, just turning to the future, as I say, the, Wormald and Redwall businesses are in the business.

We've been underway for some time now, I'm really delighted with how they are going. In terms of what's ahead of us is the ADT UK.

I'll quickly just restate it for the benefit of those that aren't familiar with it. The UK business, delivered around £87 million of revenue in July 20 for the year to July 2024, has a margin that's quite a bit higher than our business, and has a much bigger recurring revenue stream.

It is just, based on residential security across the UK. It's very broad, goes across the UK.

It's, been in the UK since 1874, virtually since ADT really started, as a brand out of America. It's got over 160,000 customers and is the prime and, by far, leading residential security company in the UK.

Our, well probably just jump to the next slide, Shanene. In terms of the opportunity there, clearly there, as is in is as here, and here being more as much Australia as it is New Zealand as well, crime is prevalent.

Crime is continuing, and it seems unlikely to abate anytime soon, and and even if it doesn't, I think people's, awareness of it is only increasing. In the UK, forecast market work we looked at as part of this, shows a a really good, strong underlying growth just in application of residential security in the UK.

It's a much more accepted service right off the bat than it is actually in Australia or New Zealand. We're buying a business we, want to see, participate in the market growth in the first instance.

In the second instance, what we're really looking to do, though, is take the lessons around ADT Guard, the platforming, all the work we've done over the last couple of years that have enabled us to be in the position we're in today, up to the UK and, make ADT, by far and away the leading security services company in the UK. Very exciting for us to do that, and it'll be, as I've said at the start, very positive financially right from the get-go, but it's also, around what it does for us in the future, which is what we are focused on.

Just jumping to the to the next slide, Shanene, I guess wrapping up this and trying to keep it tight, FY 2024 was another, I'd probably say, significant year for IMG. It feels like it's been a series of significant years, and particularly around scale and positioning.

I think this year, I'd call out, we we really feel like we've got our hands around the business and we're starting to see the proof of that coming through. Then we've also taken another bold step in, scale, and, I guess, aspiration.

It's a funny word to use in Australia these days, but we'll throw it around. What the particularly with the ADT UK acquisition.

I think, because of the stable nature of that business and the relative price we paid, we see it as a very, low-risk, but high-upside, potential acquisition or, potential for our portfolio, which we're looking forward to to work on. We've seen the commercial momentum.

If if if nothing else sort of proving up our thesis that having a network of direct technicians and employees that are able to respond, quickly, that are that are well trained, that know what they're doing, does have value, and it's something, particularly in the enterprise and commercial world, I think a lot of customers have felt starved of for for probably a decade or two now, is proving to bear fruit. That ADT Guard growth coming through is very positive to see, and we'll really look to try to, get that rattling along now over the next couple of years.

And, and then just, I guess, wrapping it all up into that sort of comment around the underlying growth stepping up from that 8% to sort of 12% this year, would be a good good wrap summary for this year. Next slide, Shanene.

Looking the next couple of years, I'd break it down pretty simply for everyone. We want to keep driving the commercial pipeline, and seeing that, secured growth, and that was the secure pipeline that we were reporting against there, deliver, but also, continue to step up over time.

We want New Zealand to, be to prove up, the comments I've made this year around that the importance and, prospectivity of what we've put together down there coming through over the next couple of years, and particularly will be good to see, how they go when the economy eases a bit on the fire side. I think that'll that'll really help, that market, along.

ADT Guard, remote monitoring, core to our long-term value, and ability to create something, very special, I think, on a near-global basis. Then just the integration of UK.

That's sort of our four co- four focuses for FY 2025 and beyond, which as I say, at a base level, sees us looking at a, pro forma EPS before we start, working and delivering on that of around 8 8 cents. Dave, I'll pause there and just throw back to you for the financials, then we'll take questions.

Great. I'm not going to walk everyone through our P&L, balance sheet, or anything like that.

I do just want to talk about slide 22, and then I'll hand it back to Shanene for questions, is ultimately, and this is what I was sort of talking about during the opening stanza, is, did this business make money, are we generating free cash flow? This is effectively just the cash flow statements in a visual form.

You can sort of see the first part, outside of the box, is effectively your operating cash less your CAPEX, and Dennison talked about that the CAPEX that rolls through the business and what that's needed for. Then we've got AASB 16 costs running through the business, as well.

The gap between $24 million and $32 million is about $8 million, which is the underlying business of what it did. Then you can see on the right-hand side, which is a whole bunch of activities here, we bought three businesses, we did a cap raise, we increased the debt, and then we moved around some really small other stuff, and that contributed about $10 million.

From the start of the year to the end of the year, cash is up sort of 18.7, but if you think about it really, it's $8 million from the underlying business, and which included inside of that, that includes about $5 million, of the one-off costs, $5 million of it is cash cost that ran through the business, like dealing with receivables and impairment of assets is a non-cash item, but there was M&A costs in there, there were restructuring costs that we ran through the business to sort of stitch everything together. Then there's also the working capital impost that ran through the business.

I think, as the accountant in the room, I quite like the cash flow slide, and how much cash was actually generated. Then obviously trying to use this as our baseline that Dennison was talking about as we get a full year of Wormald and Redwall rolling through, and then also with the UK acquisition partway through the year.

I might pass it back to Shanene and Dennison.

Shanene, we'll open the floor and you can take questions. Thanks very much.

Thanks, Dennison. Thanks, David.

I've got, yeah, no questions in the Q&A, if anybody wants to, if you've got any questions, please, yeah, raise your hand, and.

Richard there.

Hi, Richard. Please, yeah, you can unmute yourself and ask your question.

Thanks, Shanene, and morning, guys. Done on a great result and especially the organic growth starting to tick up, which is really nice to see.

I think a lot of people have been waiting to see that in the business. My question is on the UK acquisition you guys have made.

Obviously very transformational, a lot of EBITDA coming in to the business now. I was wondering if you could just give us some color on cash conversion in that business and the EBITDA and how that relates to, you guys and also the cash conversion in the Australian business as well and where you see that progressing going forward.

Yeah. Look, Dave, are you happy to take that, or you want me to do that?

Maybe you do the UK one, and then I can talk about the Australian underlying business.

Yeah. Look, just the UK, probably two things that sort of stick out.

One is EBITDA in the UK includes leases that we've stated, it's a, as we like to refer to it, old EBITDA, rather new EBITDA with AASB. There from EBITDA down, therefore, you've really, in terms of free cash flow, it's CAPEX, interest, and tax.

The UK does have contracts, they are selling So, it contracts themselves aren't necessarily the issue, it's whether you capitalize and/or whether you're subsidizing. We look at they on a run rate basis in the last 3 years, there's been about $21 million of CAPEX against that business.

In terms of free cash flow from the UK, I think the EBITDA we've put at current exchange rates about $79 million, you take 21 million off for CAPEX and that leaves you your free cash flow, which gets added to the business, and then obviously just your interest costs across the business, and then your tax. In terms of the pro forma, that's why we've been very clear to say, we've fully taxed that pro forma, so, we, probably won't have a full tax rate, certainly not for some time, but we want to make sure that we're setting the base at the right level to give ourselves, room for or to not disappoint frankly.

Just and, achieve. Free cash is I'd look at it sort of 79 less 21 as a steady state, Richard, and then just interest, interest, tax.

Great. Then on the Australian side of the business, yeah, this graph sorts of is highlighting, our CAPEX at about eight.

Then the Wormald business and Redwall businesses are quite low CAPEX elements, so, somewhere maybe between half a million and a mil of additional CAPEX from those two businesses coming on. Then AASB 16 sitting in around $6 million, and then with the Wormald and Redwall businesses, there'll be sort of up to $3 million of AASB 16, on that side, as well.

Then at the moment under our current NAB facility, our full freight debt is around $9 million, but sort of Dennison was just talking about when we do the full repackaging of the debt facility with the UK acquisition, we transition to a different structure, and, we fully disclosed in the investor presentation sort of talking about $450 million of gross debt, and rates about 6% above LIBOR going through. Hopefully that gives you the information, Richard, you need to sort of piece it all together to get a sense of EBITDA through the cash conversion.

No, that's very clear and really helpful, and positive on the cash generation there. Thanks, guys.

Maybe just also, Dennison, on the to the UK business. I'm just curious, how similar it is to your monitoring business in Australia.

Are there monitoring rooms sitting there? Is that where a lot of the CAPEX is going, and also the potential of bringing Video Guard as a product there and are some of the other security players in that market kind of doing similar work on the video side of things?

Yeah. No, good all good questions.

I think the way I would phrase the UK for people is, yeah, essentially around the world, an intrusion alarm system is an intrusion alarm system. There are a lot of different ones actually, as it turns out, but they all do the same thing and they've all done the same thing for 50 years, and that's the same in the UK.

Even Verisure, who are the leading, growing player in the UK over the last decade, are just offering an intrusion system with CCTV camera. Very standard vanilla thing, and we see that everywhere, and I suppose that's sort of why our ears pick up as to the opportunity, given what we are seeing here and what we're doing.

The difference in the UK to Australia I think is on you have a thing called a licensed customer, an unlicensed customer, and a licensed customer, which takes a little bit longer to get set up as a customer, means that if you go through If, if two zones of an alarm go off in an intrusion, somebody's walking around your property, they trigger your kitchen and your lounge, and we get that response, we are able to go to the police and they may respond. I always say, able to and may, it doesn't guarantee it, and it and because the police will say, "All right, well, it's a customer who's we take seriously.

They've been credentialed and indicated by us. Can we go?

Should we go?" We don't know.

It could be a It probably is a real thing, and they have to weigh it up with what they're doing. What that means is that the service from the outset in the UK feels more valuable than it does in Australia.

You can make the case to a UK customer today that there's a there is a sort of element of police protection, and I think a lot of customers feel that they have that, even though it's actually a small proportion of the overall base that's there today, and that leads to a higher starting penetration than what we have here and a slightly higher ARPU as well from a customer per month. Our opportunity, of course, is unique, and that is, to take the from being an intrusion situation to essentially patrolling and prowling the perimeter with our cameras when they are turned on, which is actioned by the customer, and that allows us to go in the to the police directly, either before an event or right when it's starting, and the police take that very seriously.

It's a completely different response mechanism and feeling from the police if they actually know something's happening versus there could be something happening with a customer that could be at risk, and so hence why we have the arrests. I think that's the big difference.

In terms of us enabling it, part of all of this is of course, in life, generally, is a bit of luck, and our core technology platform that ADT frankly uses around the world is about to be enabled with video monitoring. Now, I don't believe most of the ADT businesses probably even realize that, but we do, by virtue of the partnerships and journey that we've had, which means that, within about the first 6 months, and I want to be cautious here about setting expectations, because there is time to do these things.

It will take a bit to give customers used to what we're doing. We'll be able to enable ADT Guard by quite simply just going back to that existing customer base, as we will be able to do in Australia if we wish as well, and it's a little bit more complicated here, because of the historic customer mix, and actually offer them the service.

In terms of delivering it, the room, funnily enough, is enabled for a form of video, and so there will be training and things involved. We don't own the room itself, just to call out.

We are, we are using ADT's, sorry, Johnson Controls' room, that's the very, very end of our chain, though. We do everything else for the customer other than the literal response bit, but that room is able to do it.

The big game, as I said in UK, is two things. One is let's get ADT back to market growth.

It has fallen off. It's been unloved, and very much a sort of out, the sides, very small business for Johnson Controls, and then the other part is to enable it, to actually grow market, grow addressable market and grow share and use Guard, which we think we can start to do within the first six, to 12 months.

Super helpful. Thanks very much, Dennison.

Maybe I'll just ask one more as well. Just on the commercial pipeline, that you guys are seeing in Australia, New Zealand, obviously continues to grow rapidly.

What's the sort of vertical or sector mix of that pipeline, the customers? Are you seeing some pretty strong demand, from, I guess, there's a lot of work going on in digital infrastructure and data centers and the likes?

Maybe you can just give us a flavor of where that growth is coming from.

Yeah. No, I'll take that one.

Look, again, it's very broad-based. I don't think any one customer group area would represent more than 25% of the book, which is, as we actually we did sort of disclose a deeper split in that first quarter result this year, and I think it's largely held the same.

I haven't actually run the work, but I haven't noticed any differences. In terms of, I suppose, notable things, we are a beneficiary of data center growth.

We do have one customer in particular who's very well capitalized, is a long-term player in Australia, who we are, effectively, we like to think, and been told, their preferred partner. They have a big development pipeline, but that is only sort of proportionate to all the other opportunities we have, I'm sort of loath to become a data center proxy, growth story, because it's actually much wider for us than that.

I think generally speaking, what's really happening is these on a commercial and enterprise level, an intrusion and/or access control systems data, and control can lead to a lot more applications and enterprise help and functionality, if it is integrated, if you're running it as one system across a big business, and I think that's what we're seeing. We see, for instance, Sydney Airport, looking to tender to try and bring They have different access control systems spread throughout the site, which means they don't have one source of truth information.

If somebody, quits, leaves, they have to restart someone, they've got to get them on multiple systems, they can't really take much from that data, understand it, learn it, control it. I think they're looking to integrate, as an example.

It's a broad it's a broad thing, and, I think what I'm really, interested in, I guess in a to a degree it's sort of validating, is that right at the start of this journey when we got ADT, it was because we had large enterprise customers saying, "If you had direct technicians and the capability you have in your monitoring rooms and you could do all of our work for us, we'd want you to do it all." By virtue of just getting ADT, which did have a good reputation in this area, albeit it had a poor finish because of a strategic decision out of Milwaukee, and actually enabling it, the customers have come back.

We're not been out seeing ADT in all over the world for us to be reporting this growth. What it is, is our reputation is already established and people understanding.

A lot of it is actually existing sort of essentially customers who touched ADT at one point, and/or that we've acquired, but now engaged a different conversation with them and said, "We can do more than what we were doing, what we have been doing for you," has lead to all of this growth. We think there's, there's a lot more left in the commercial security tank, over the next couple of years as we continue to build.

We've got to build it, though, as we go, and we've got to make sure our talent, is matching our words, which it is to this point, which is great.

That's great, Dennison. Great seeing the progress.

Done, team.

Thank you.

Thanks, Richard. Thanks, Dennison.

We've got a question on the Q&A. So, "Dennison, line of credit for the UK, is there an opportunity to save on financing costs once it's done?"

It's a good question, Fadi. Yes is the answer, and I We haven't announced it as part of this result, but we're happy to talk about it.

As part of our facility agreement with Ares, they have allowed us to introduce a senior secured lender to the mix, I guess, and we've been having discussions with a range of parties. There's high demand for it, and we are looking to close that out, over the next few weeks.

What that will do is it will allow us to bring the funding cost down a little bit more. At the moment, post-UK they're sitting just over sort of 10% all-in.

With a little bit of luck, we might be able to bring that under the double digits, which just makes us a bit more comfortable on a more medium-term basis. Obviously, we want to see those Having worked hard to get to senior, it was a serious decision for us to go to the UK, not just for the strategic reasons, but also for financial ones.

The plan is to to see that that funding rate fall back to more of a senior level again over time as we execute. I suppose, watch this space.

Thanks, Dennison. I've got Paul who has his hand up.

Paul, you can unmute yourself, please, and ask your question.

Dennison, first of all, congratulations on the good numbers. I got a few questions, more or less on the financial side.

I've seen that the Wait a second. The receivables went up like 30%.

I just want to understand what's happening there. On the same time, I guess you already touched it, but I think I missed it, the impairment of receivables is something I would like to understand as well.

The impairment of assets that you have in the adjusted EBITDA reconciliation, if you could shed a little bit of light what's happening there, would be quite nice.

Yeah. I'm happy to take those, but I'll see if Dave wants to have a crack at it.

I'll have a go and then, yeah, you back us up, Dennison. The receivables bounce, you're right.

On the face of it, it looks like receivables have gone up by a lot. We did acquire three businesses during the year.

Part of the acquisition is that you acquire, yeah, standard working capital that's running through. If you think about the three that we bought, WAPL and BMP, which were right at the start of the year, and then we had Walker, which is the Wormald and the Redwall ones, we did that literally on the 30th of May.

I'd have to go back and check my numbers, and they'll be in the purchase price accounting methodology that we run through, but effectively, the majority of that is to do with the purchasing. There is some working capital impost and we have got transparency on what that is, and we're trying to seek how to make sure that as we grow and the installations grow, that we are billing, getting the WIP out to an actual invoice amount and collect as we go through it.

Once we've got stabilized positions, Paul, you shouldn't see a violent movement in the items like the invoicing elements get through. In terms of the receivables, so, obviously a big part of what we've acquired has come out of the JCI framework, and we have both residential and small-to-medium customers and commercial customers.

Majority of the receivables are to do with the resi and the small-to-medium enterprises, and what we are seeking to do is move people away from physically paying invoices into more of a direct debit sort of approach. I'm assuming everyone on the call, and me, myself, included, is, when you set up the direct debit, it sort of rolls through pretty quickly.

If you don't have that, then it becomes an afterthought as we roll through. The comment in the one-offs is saying, we've inherited a structure, we're seeking to clean it up as we go forward.

We need to make some pretty fundamental changes about how we engage with our customers on that side of things, and it's front of mind of management's action items as we go forward. The impairment of assets, a big chunk of that is to do with the assets that were part of previous acquisitions past the 12-month period.

You've got a 12-month period to adjust your purchase price accounting under the accounting standards, and you would move your opening balance sheet item. Post that 12-month period, a full review of aged stock has been undertaken this year in FY 2024.

Dennison was saying, "Let's get a clean balance sheet. Let's get everything sorted out, and I don't want any obsolete or recalcitrant assets sitting around in warehouses."

A decision was taken, Paul, to impair any assets over a certain period that we couldn't see line of sight in terms of deploying to customers. Now, we haven't thrown the stuff out.

We haven't sold it. It is sitting there for the operations teams to use if there is an opportunity, but we wanted to represent the inventory as the best position going forward.

Got it. David, sorry, just want one more questions.

I didn't understood exactly the impairment of receivables. You have 3 million this year.

You have 2.9 last year. It's 2 years in a row that your non-recurring are actually recurring, to say.

Could you maybe rephrase that, where it's coming from?

Yeah. The way I'd describe it, Paul, is, it's our historic ADT customer base, it's not new customers.

It's not things we're doing now. It goes back to the customers we had for a while where they are generating receivable, and I think last year it was a bit so like this.

It popped up, I was like, "Oh, not that again." This year we've sought to draw a line under it, and today's point, this is sort of ceasing at this point, but it relates to long-term historic customers that are not on direct credit, that are difficult, that we have to chase.

We wanted to just kind of, I suppose, clean the books, if I put it that way, and just draw a line under it, and then we'll go from there. It's not new customers, not business as usual, it's not the stuff we're doing.

It's the stuff we inherited that it's taken a while to get on top of. I'd just step back, because that comment sort of does feed into the impairment of assets one, too.

Albeit, I know, time moves on for everybody, ADT AU in particular was a hell of a mess when we bought it in 2023, and I always described it as an onion. I said, "Look, there's layers of stuff here we're going to have to work through," and so you can see that in the receivables, because that is all historic.

We just haven't drawn a line under it, which we are doing now. The impairment of assets was the same, and so this year we've implemented a complete re-processing of procurement, we've bought in experts, we've realigned our warehouses, we've gone through everything, and, frankly, I just said, "If it's not got a useful life, throw it out, burn it, write it off.

I just want it gone. I want a clean house."

Therefore, we did, and the guys and I said, "Don't spare anything. I want it to be clean and clear so we can move forward."

I think, in a sort of conceptual way, that's what I'm sort of trying to say about these accounts this year for '24. These accounts for '24 now represent as clean a accounts as we've ever had, and will probably have, on the go-forward basis, so that we feel comfortable about sort of forecasting off them and moving forward.

The impairment of receivable one does come with a little bit of work still to do, to Dave's point, we want to move more people on to direct credit to work through that, The expectation we've set on the business is it doesn't lead to more impairment on the go-forward.

Understood, Dennison. Just so I understand rightly, if I would ask you about what would be the impairment of receivables and assets be in fiscal year 2025, you're more or less saying, those shouldn't recur again, right?

Shouldn't be in

that size.

Yeah. They shouldn't, and I'd be cautious about absolute comments in this sort of thing in life.

We can make it not appear again, but it also might not be economically fair. We are trying to present accounts that show the underlying true cash profitability of the business and impact of it.

I'm giving myself a little bit of wiggle room because I don't feel like we are 100% control of it, but we are now very on top of it, aware of it, and we just got to drive it out. I don't expect to be having a significant conversation about it, if any at all, next year.

That's probably the way I'd put it. It won't be like this again.

Appreciate it, Dennison. That's it.

Thank you very much.

Yeah. No problem at all.

I think I'll just take a point on that, too, though, just to Dave's comments at the start about cash flow, operating cash flow, and free cash flow. They are headline numbers, and so, again, within those is transaction costs for, frankly, the M&A, we had capital-raising costs and advisory costs and all that sort of stuff this year, and obviously when we see the kind of uplift the business is going to get, that was an investment we made now for the future.

Also it does have working capital from these acquisitions and things. I'm quite optimistic about the cash flow continuing to build as, again, these things continue to shake out.

The trajectory for us is probably the most heartening thing. We feel like we're doing what we said we'd do, and sometimes timing can skip and miss or be ahead, but the direction of what we're doing is spot-on, and gives us a lot of comfort and confidence and, frankly, excitement, too, about what we're doing here.

One last question, Dennison, just came up on my mind. Sorry if someone else wants to ask another one.

On the CAPEX side, I think this second half, I think it was about 2 million, as far as I remember, compared to the first half year. I wanted to get some thoughts from your side on the, I forgot how it's called, from 3G to 4G transition.

In New Zealand, how it's going? I've seen you invested 1 million into the video guarding, and I was wondering, what did you

spend

the 1 million in?

Yeah. That's OPEX.

That, to be blunt, that's wages, it's tooling up a team to go after opportunities. The sales pipeline times on commercial around Guarding does take a little bit of time to generate we're changing an industry, we've got a new service, we're also having to train people how to sell it.

It was a definitive, we want to go after the opportunity, we're just trying to run the balance of overinvesting, underinvesting, vis-a-vis the growth we want to deliver over the next 2 and 3 years. We're just trying to run that juggle, and the point with the $1 million bucks just over was, we actually went ahead and said, "Let's just stand up a team, let's get some good people, let's try and train them, let's learn the lessons, and let's go."

It didn't return on itself this year, but we're really confident about what it's showing us in the pathway forward now. We just wanted to sort of call that out.

CAPEX, yeah, it's trailed, it's basically, again, it's done what we sort of said it would do. If you go back to when we bought ADT, we had to go through the 3G transition in Australia, cost us money, a distraction, time, paying for it on top of everything else, got through it.

Then left with New Zealand, which 3G shut down was later. That's now largely complete, they're shutting off the networks going around the country bit by bit, but to all intents and purposes from our perspective, it is done.

The capital we needed to spend there was around our medical business where it was all on pre-3G technology, we had to refleet the entire medical fleet in our business. We are the second largest medical alarms provider in New Zealand, and of what I'll call old ADT, pre-Redwall and Wormald, was about a third of that business.

We had to do that, that CAPEX is all complete now. There's, I guess, the proof statement is, as we said, is CAPEX comes down over time from what had been some big numbers, down to your point, I can't validate this, but it sounds right to me, Paul, that $2 million.

On the go-forward, the way we look at CAPEX is there's a stay-in-business kind of CAPEX level for IMG Group pre-the UK, which is around $3 million a year. We'll put another million dollars in for Wormald just to cover our bases here, and we do want to actually spend some money, as well, there.

We think there are systems improvements and things we can do there, help the business. Then there's about $4 million of recurring CAPEX now in medical.

Now, it probably will be less than that for the next year or two, because we've just refleeted, but on a normalized basis, you're talking at a group level of a EBITDA business of about 55, about $9 million of CAPEX. You've then of course got the AASB sort of leases you've got to take off, too, and down.

CAPEX pre-UK, $9 million. With the UK, I'll go back to the pro forma level, we're talking about it sort of $133 million EBITDA, CAPEX across New Zealand, Australia, and the UK for the group on a pro forma is about $30 million.

You're adding in sort of 21 mil from the UK to do that, and then flowing down. Is that helpful, Paul?

Very helpful, Dennison. Appreciate it.

Might follow up with some more questions via email then. Thank you.

Perfect. Thank you.

Thank you, Paul. Thanks, Dennison.

That's it for our questions.

Great. We'll wait for a second in case anybody has anything else.

Obviously, we're available. Our numbers and contact details are, I think, on the slides.

I'd like to thank Dave for joining us. I should have noted Dave's first CFO performance for IMG Group.

Dave's obviously known to many in the market through his MMA Marine days. Really great to have him on board.

Thank you, Shanene, for your help. I guess the summary to wrap up here is we feel really quite good about these results.

We feel like we've got a really good base here. We feel like the direction of the business is sort of largely doing what we hoped it would do and, I suppose, expected it to do.

As we look out to now '25 and '26, we think we've got a really exciting, not just story, but actual business, and hopefully one that will be of increasing value over time, too, to all stakeholders. Appreciate the support, interest.

Happy to take questions offline, and if not, we will see some of you over the next week or two as we travel around. Thanks very much.

Thank you.