Thank you. Good morning all and welcome to Superloop's 2026 first-half results investor briefing.

My name's Paul Tyler. I'm the CEO of Superloop, and I'm joined here by Dean Tognella, our CFO.

This is really a great day for the company. I'm incredibly proud to be delivering what I believe is one of our strongest set of financial results ever.

At the same time, announcing an important acquisition, that of Lightning Broadband, enhancing our infrastructure credentials and further building on our long-term smart communities strategy. If we jump to slide four, but in doing so, you'll glide past the earlier slide in which we show just some of the recent awards that we've won.

It's sometimes missed when we talk about the great financial results that underpinning our performance is also a great set of customer experiences, products that are high speed, high performance, and supported with excellent service. We continue to invest in these products and challenge ourselves to improve.

We'll cover the first-half results and the second-half outlook first, then move to a few slides on the Lightning acquisition, and finally, there'll be an opportunity for Q&A at the end. Jump to slide five, looking at the headline numbers, Superloop has delivered strong demonstrated momentum and clear operating leverage.

Revenue increased to $317.6 million, up 23% year-on-year, driven by continued customer growth in consumer and sustained wholesale momentum as we enable challenger retail service providers. That top-line growth translated into a material earnings uplift, with underlying EBITDA of $55.8 million, up 46% year-on-year.

Importantly, we also delivered a net profit after tax of $5.1 million, which is a $12.9 million improvement year-on-year. Having finally achieved a positive NPAT in the last financial year, we expect net profit and earnings per share to build quickly from here.

Gross operating cash flow was $55.3 million, and operating cash conversion was 96% of underlying EBITDA, underlining the highly cash-generative nature of our business. Finally, customer growth remains a key driver of our performance.

We ended the half with 805,000 customers, up 21% year-on-year, with 74,000 net customer additions during the half, almost all organic, an industry-leading outcome. In summary, the results demonstrate that Superloop is delivering strong revenue growth, expanding EBITDA margins, growing NPAT, and generating significant cash, all underpinned by sustained customer growth and satisfaction.

Move to slide six, please, across the entire group, with growth coming from all three segments and translating into higher earnings and cash flow. We continue to see industry NBN market share increasing to 7%.

Importantly, we captured 14.5% of NBN orders in first half '26, which reinforces that we are consistently taking share. This customer growth is flowing through to our revenue across all segments.

Consumer revenue increased 29% year-on-year. Wholesale revenue grew 28%.

Business revenue increased 4%. Our underlying EBITDA margin increased to 17.6%, up 2.7 percentage points on the previous year.

As a result of pleasing momentum in the first half and the visibility we have into the second, we are upgrading full-year underlying EBITDA guidance to between $112 and $120 million. We're also on track to achieving the last remaining metrics in our three-year plan, which we regard as no small achievement given the ambitious targets we set of doubling our revenues whilst simultaneously expanding margins.

I'll cover the acquisition of Lightning Broadband at the end of the presentation, as mentioned. If you move to slide seven, please, over several years, Superloop has delivered sustained growth across customers, revenue, and earnings.

The first half of FY '26 is a continuation of that trend. As mentioned, customer numbers ended the half at just over 805,000.

The operating leverage that comes with scale is clear, with revenue growing faster than customers, EBITDA increasing at 46% year-on-year, again, significantly faster than revenue. Our strategy aims not just to deliver growth, but rather doing that whilst simultaneously expanding margin quality.

Revenue growth in the first half was broad-based, with all three segments contributing. Consumer remains the largest contributor, ARPU expansion particularly on higher-speed plans.

Wholesale is becoming an increasingly important contributor to group revenue and quality, and business revenue is improving, with smart communities now a consistent driver, together with a growing revenue book from enterprise and secure connectivity wins. Whilst consumer drives volume and scale, wholesale and business revenues are improving the resilience and sustainability of group earnings over time.

On slide nine, you can see the contribution from each of the segments. On this, you'll hear is that whilst our consumer had a great half and is clearly our largest revenue contributor, business and wholesale account for 46% their structurally higher margins, sorry.

Slide 10, segment delivered 49,000 net new customers, the strongest organic result we've ever achieved despite competitive ma- is associated with the NBN speed bestowal and competitors changing their pricing structures. That customer growth translated into 29% revenue growth.

Importantly, we've achieved record customer growth whilst maintaining our pricing discipline and have maintained our margin quality. If we move to wholesale on slide 11, momentum in the challenger RSP market drove the wholesale segment revenue up 28%, and margin- Customer numbers increased to 258,000, up approximately 20,000 in the half, with 15,000 of that 20,000 total additions coming in the final 7 weeks of the half.

Then finally, business on slide 12, business revenue increased 4% to $54.3 million, with signs of improving market conditions and momentum. New logos signed in the period include major wins, such as mycar Tyre & Auto, ARB, Coles, and Village Roadshow.

Is more measured than consumer and wholesale, margin quality continues to improve. Absolute gross margin was up nearly 10% year-on-year, moved to 41.9%, which reflects a better mix.

On slide 13, across the group, I won't cover it again except to say that we are thrilled by how the business has performed and look forward to a strong second half where we expect to continue the positive momentum in consumer and see strong second-half seasonality coming through wholesale. Jumping to slide 15, our customer growth is underpin- and acquisition efficiency.

During the half, we saw momentum across all core brand indicators, including prompted brand awareness, branded search, and site traffic. Branded search is particularly important in telco as it's a brand-led category.

Our steady progress here is encouraging. Slide 16, customer satisfaction directly impacts our growth and profitability.

Our investments in automation and AI have been paying dividends, with demonstrable improvements in both customer experience and cost to serve. We are increasingly embedding AI and workflow automation across support and operations, and we're now seeing tangible benefits.

Superloop-developed, customer-facing tools such as Refreshafi and X-Ray allow customers is quickly through the Superloop app, reducing the need for assisted support. At the same time, our AI agents, Teddy and Mo, handling a growing proportion of customer interactions and delivering higher customer experience scores.

Notwithstanding our growing customer base, as a result of putting Superloop tools directly in the hands of customers, our inbound support calls per customer actually decreased around 30% over the last 18 months. We're also reducing our reliance on voice, which is our most expensive support channel.

Slide 17, the Superloop business is built on a single, integrated operating model that supports consumer, business, and wholesale at scale. At the core is our infra-on-demand network and single, integrated digital stack, which allows us to launch products, onboard customers, and manage the network efficiently across segments.

Importantly, we are increasingly embedding AI and automation across the business, not as standalone initiatives, but as core enablers of scale and efficiency. Slide 18 is a quick representation of our network, which includes over 2,400 on-net data centers and commercial sites, kilometers of owned metro fiber, complemented by international subsea capacity.

This foot- business and wholesale customers from a common infrastructure base. Importantly, once the fiber is built, additional services can be delivered at a relatively low marginal cost, which supports the earnings progression we've discussed earlier.

The network also underpins our smart communities strategy, with the ability to leverage our fiber footprint to connect existing and new buildings. I'll now hand over to Dean to provide some comments on the financial performance of the group during the half year.

Thanks, Paul. It has been a very strong start to FY '26.

Superloop's results in the half demonstrate the scalability, efficiency, and quality of our business. We reported revenue of $317.6 million, up 23%, consumer and wholesale.

Growth is translating directly into profitability, with underlying EBITDA up 46% to $55.8 million, reflecting clear operating leverage. Our gross margin increased by $23.9 million to $111.9 million.

Importantly, we held our consumer gross margin at 27.5% while achieving record volume growth, highlighting the strength of our consumer offerings and our low cost to serve, remains a key feature of the result. Opex growth was with $5.1 million with $5 million of this growth being from an increase in marketing spend.

Our opex to revenue declined from 15.4% in the first half last year to 13.4%. While our total employee expenses were essentially flat, reflecting our scalable operating model and increasing returns from our AI-enabled d- Cash generation was a standout.

Gross operating cash flow rose 43% to $53.5 million, converting 96% of underlying EBITDA, demonstrating the high quality and repeatability of our earnings. Free cash flow increased to $32.2 million, up 102% year-on-year.

Moving to slide 21, starting with consumer, consumer gross margin increased by $14.3 million, broadly steady at 27.5% despite industry pricing resets. Business contributed a further $2 million uplift.

This increase reflects increased contribution from smart communities and increased traction in secure connectivity, with the GM percentage improving 2.1% to 41.9%. Wholesale was the standout contributor, with reported GM up $7.6 million and reported GM percentage up 5.6 points to 65.9%.

This reflects healthier product mix and the end of modem pass-through revenue for a wholesale customer. The group gross margin percentage remained stable at 35.2%, even as we achieved subs- Moving to slide 22, this slide really illustrates the cost advantage Total operating expenses increased by $8.6 million, or about 16.6% year-on-year.

That uplift was in to capture a market opportunity. Marketing was the largest increase, up $5.1 million.

This investment contributed to the addition of 49,000 new consumer customers and boosted brand awareness for both Superloop Other opex increased modestly, up $3.3 million. Of note, employee expenses were essentially flat despite the scale This is a direct outcome of the digital investments we've been making, including automation, AI workflow tools, and improved digital customer journeys.

We are increasingly able to support more customers, more orders, and do so by leveraging technology to provide an excellent customer experience. Moving to slide 23, capex spend continues to be highly targeted and aligned to growth, efficiency, and long-term margin expansion.

Total capex for the half is $21 million, representing a heavier first half due to a number of larger fiber- and network-related investments. Largest increases in spend with digital and transformation, where we invested $5.2 million into automation and AI in our platforms, and in customer-related capex, where we invested $7.7 million in building our smart communities infrastructure and other growth opportunities.

Now moving to slide 24, cash trends for the half. Gross operating cash flow increased to $53.5 million, and cash conversion remained excellent at 96% of underlying EBITDA, which continues to be a distinguishing feature of the business.

It has held up even as we have accelerated growth, demonstrating our underlying discipline in working capital and the repeatable nature of our revenues to $32.2 million, up 102% year-on-year. We finished the half in a positive net cash position of $3.9 and we remain well inside all covenant thresholds.

We also completed the refinancing of our facility in October, securing a new $300 million, four-year loan package with significantly improved terms. The expanded facility provides ample investment and the acquisition of Lightning Broadband.

Even post the completion of Lightning Broadband acquisition, the business will maintain substan- with a leverage ratio of approximately 1.4 times. I'll now pass back to Paul for FY '26 outlook.

Thanks very much. We're on slide 20- on track to deliver the final ambitions of our three-year Double Down strategy by the end of FY '26.

Whilst not anticipated in that plan, it's encouraging that our growth to date has been almost entirely organic. On slide 27, pulse of the strong first-half performance and the continued trading momentum we've had to date, we've upgraded full-year FY '26 underlying EBITDA guidance to a range of between $112 and $120 million, which represents approximately 21% to 30% growth on FY '25.

Capital expenditure guidance remains unchanged at $32 to $35 million, excluding the IRU- Upgraded guidance does not assume any contribution from Lightning Broadband. With that, I'll now spend a couple of minutes on the acquisition itself.

On slide 28, before I move into the detailed slides, I wanted to note that this acquisition accelerates Superloop into a scaled, national, fiber-to-the-premise challenger, with materially greater exposure to high-margin, annuity-style revenues and high- This is a business model we know well. The acquisition adds scale and momentum to our smart community strategy, which we've been executing over a number of years.

Over the next few slides, we'll step through why Lightning is such a strong strategic fit, how it enhances our smart community strategy, and how this acquisition will create value for shareholders. Slide 29, this acquisition is the next step in a strategy we've been executing for some years.

Superloop has deliberately built capabilities in smart communities and has now added significant scale through the Lightning Broadband acquisition. Lightning Broadband adds a large, built FTTP network and a larger, contracted book.

This is an acceleration of an established strategy, as you can see by the milestones on this chart. Slide 30, post-acquisition, Superloop becomes a scaled, national, fiber-to-the-premise challenger, with today Lightning Broadband having 24,000 built FTTP lots and a contract book of an additional 30,000 lots.

These 30,000 lots are expected to be built over the next five years and provide visible revenue and earnings growth. The acquisition enhances major retail service providers.

From a financial perspective, Lightning Broadband has strong financials, with high gross margins and annuity-style revenues. We expect to be able to further improve margins through synergies from leveraging Superloop's existing domestic and international assets.

Slide 31, Superloop has entered into a binding agreement to acquire 100% of Lightning Broa- funded from existing cash and debt facilities. On completion, leverage remains modest, with net debt expected to be around 1.4 times, balance sheet flexibility.

Lightning is expected to generate approximately $11 million of EBITDA in FY '27 on a pre-synergy basis, and the transaction is expected to be EPS accretive in FY '27. We expect to realize around $5 million of annualized synergies achieved within the first three years, primarily through network integration and infrastructure efficiencies.

Completion is subject to customary regulatory approvals, and we currently expect the transaction to complete in the fourth quarter of this financial year. Slide 32, the Lightning Group includes Lynham Networks as the FTTP infrastructure owner and wholesale network operating as a statutory infrastructure provider across more than 400 locations.

It also includes Lightning Broadband as a retail service The group builds and owns fiber-to-the-premise infrastructure in residential, apartment, and commercial developments, where overbuild is commercially unattractive once Today, Lightning has around 54,000 contracted lots, of which approximately 24,000 are already built, and across 400-plus developments. The network operates on an open-access, wholesale model, allowing multiple retail service provid- infrastructure.

Whilst the group generates some retail earnings, the core value of the business is from the wholesale services it provi- Slide 33, Lightning has historically been strong in multi-dwelling developments, while Superloop adds student accommodation. The combination also materially expands the number of retail service providers who use the FTTP network.

From a sales perspective, the developer bases are largely additive, expanding our national coverage and effectively doubling sales reach and pipeline depth. Product set and infrastructure scale expand our addressable market, whilst leveraging Superloop's existing fiber to improve network economics over time.

Slide 34, Lightning Broadband generates annuity-style revenues, with a strong skew towards wholesale infrastructure income. The revenue mix is predominantly wholesale, with the balance coming from retail and other services.

High recurring revenue, stable, occupancy-driven cash flows, and strong inflation resilience over time. Importantly, the underlying infrastruc- particularly well in excess of 25 years, which support durable, predictable earnings.

From an economics perspective, the model has high operating leverage. Once the fiber is built, the cost base is largely fixed, and incremental services are delivered at high gross margins.

The acquisition provides long-term organic growth. The attractive revenue characteristics are underpinned by a highly visible, contracted growth pipeline.

Future revenue and earnings expansion comes from the lots that are already committed by developers, often years in advance, which provides strong forward earnings visibility. Future contracted premises are around 2.8 times the current active base, which highlights the long runway for organic growth as sites are constructed and activated.

Lightning's contract book is more MDU-weighted, as mentioned, which typically have shorter construction timelines, supporting faster conversions from contracted to revenue-generating assets than in comparable broadacre developments. On slide 36, by integrating Lightning's FTTP footprint onto Superloop's existing network, we can reduce backhaul and transit costs, improve utilization of our own fiber assets, and systems across a larger footprint.

We expect to realize around $5 million of annualized synergy- sorry, $5 million of annualized cost synergies within three years, as discussed. On slide 37, Lightning Broadband accelerates our smart community strategy.

It strengthens our competitive position with developers and retail service providers, and improves Network action is funded within existing facilities, expected to be EPS accretive, and supported by low-risk, network-led synergies. Overall, this acqui- and supports long-term shareholder value creation.

Okay. Slide 38, to close, I just want to step back We've delivered an exceptional set of results in the business, with the first half of FY '26 demonstrating that our strategy is working, and we are scaling as intended.

We've delivered strong, broad-based growth, increased profitability, and excellent cash generation, whilst continuing to grow customers at an industry-leading rate. Importantly, this performance has been organic.

Further, we've taken a significant step forward in our smart community strategy with the acquisition of Lightning Broadband, which accelerates our scale as a national FTTP challenger and expands the infrastructure earnings of the business. With that, very happy to take questions.

Hi, Nick.

Hey, Paul. Thanks very much.

Great set of numbers. I've fielded, I guess, a barrage of questions just the last three months, I really wanted to focus on that.

I'll just hit you with my two questions and then answer them if that's okay? If I look at wholesale and Origin, and I sort of backsolve from the AGM, it looks to me like the net adds in the wholesale segment have basically 3x-ed from November to December '25.

If you use that December '25 run rate, it suggests wholesale/Origin could be adding to more than 60,000 subs in the second half. That'd be a better half than last year, which is probably a bit different to what some people were worried about.

My first question is, is that logic reasonable? Flavor or color around what's happened post-December?

My second question is just on Superloop consumer NBN. Kind of similar maths on pricing, obviously from much higher levels.

In November, December and a bunch of Superloop investors seem worried that it was going to hurt your NBN consumer growth. From what I can see, your adds in December, Superloop-branded NBN were double what they were in November.

The numbers I'm seeing actually suggest you're doing better, which is consistent with the 14%, 14.5% adds. The question is really, sorry, it's a mouthful, is it safe to say what your competitors are doing is not slowing your growth, actually, it's accelerating it?

Any reason to think differently about the net adds in consumer December? I'll stop and breathe.

Thank you.

Thanks, Nick. Let me try and give some color without being cute.

Obviously, we don't comment on Origin specifically. The trend you call out for our wholesale business is correct.

I think the logic is fine. We would expect our wholesale business to have a weak first quarter, which it did, as expected.

There's clear seasonality in that, and we've explained that many times. We definitely picked up materially in the second quarter and particularly in the back end of the second quarter as our wholesale more aggressive propositions to the market, and they're continue doing that into the first half.

Yes, we feel good about where wholesale is going. As I said, we haven't uplifted our earnings guidance for the full year.

You can sort of read out of that that we have confidence in where the business is going. On our consumer business in particular, I'll make a couple of comments.

We've always said that any disruption in the market is good for us. Than our existing back-book share, as we've said, we're now 7% market share and acquiring at 14.5% of the market on a longer market is good, be that price shocks from NBN, speed bestowals, blow up the rusted-on bases is good because we generally acquire quite well.

I'd also call out it's not just a price game. If you look at some of the accolades that we have demonstrated at the very start of this presentation, we have a fantastic product.

We sort of the marquee customer awards at the very very start. It's an award we haven't won before as one of the best RSPs in the market.

Obviously, we've been winning the best, but we really do have a great product that's getting rave reviews, frankly, from the marketplace. The brand is working.

Our brand preference is increasing, and with that strengthened brand, market disruption, and a value product that performs exceptionally well, it's very good environment for us to take share. I think some of the commentary around the news of our demise based on a price change from a legacy RSP, even a large one, is a little bit bemusing.

Thank you. I'll jump to the back of the queue and let someone else ask another question.

Thanks, Paul.

Thanks, Nick.

Hi, Evan.

Hi. Morning, all.

Just the first one around the within that, would just keen to understand I guess a bit more depth how you're seeing the ROI from that marketing and if it's helping at all to reduce any of your churn or any sort of I guess, yeah, further metrics you can provide around the marketing spend and then also into 2H, how you're thinking that line should look as well. Thanks.

Hey,

I'll pass to you on this one, Dean.

I'm happy to take that one. We increased our marketing spend in the first half, and the returns were excellent in terms of what was seen in consumer net adds.

The other piece as well was there was a fairly significant directed at brand, and we're trying to give you a sense of the brand metrics are really starting to help us. What we're seeing is increasing efficiency as our prompted awareness and our conversion rates improve.

We're extremely happy with the results of the spend in the first half. Coming into the second half, trading is good now, and we're happy with the costs that we're acquiring.

If it stays in these sorts of conditions, then yes, we will potentially come back a little bit from the first half in spend on marketing, preserving the right to keep spending a little bit higher than what we have historically in the second half on marketing because the conditions are good, the acquisition rates are high, and we're not seeing a substantial change in the cost that we've been historically acquiring at.

Cool. Okay.

Firstly, congrats on the deal. Are you able to give us an idea of how many RSPs you have now assuming Lightning goes through and, if possible, which are the larger ones you've now added as well?

I just remember OptiComm talking a lot about how important it was to add more and more RSPs, just keen to sort of unpack that element of it a bit if that's possible.

Look, it's so important, and the acquisition of Lightning does double the number of RSPs that are on that work as announced. We're going to have an investor day in June, probably early in June, we'll announce the date soon, where we'll really lay all that out, and we should have completed by then.

Hopefully, we'll complete it by then. We'll lay out RSP lists and all those sort of things in that investor day.

It is important. I'd make the distinction that it's a little bit different in our case because we do come with strong RSPs ourselves, right?

In OptiComm's case, they didn't have a strong internal RSP, whereas clearly, as fast-growing brand in the market, Superloop already turns up with a pretty as important. Certainly, a high amount of choice is a feature that we'll continue to promote.

We'll give you some more precision on Cool.

Thanks, both. Any

Thanks for taking my question. Just firstly, on the guidance that you've given us, if we take last year's seasonality as a proxy and apply to your first-half result, it implies around $135 million of EBITDA for the full year.

Now, conscious that conservatism is appreciated by the market, but are there any drags in the second half this year that we might be missing relative to last year that could impact the seasonality for FY '26?

Nothing dramatic. There's a degree of conservatism, but the short-term market changes, we've assumed a degree of seasonality, obviously, in the guidance of $112 to $120.

That's a similar skew to last year. If things go well, if we continue to trade at the levels we are, then obviously, we'll be in the upper end of the range.

If trading conditions come off a little bit, then it'll be sort of further down the range. We've given a range.

It's a material uplift on the prior year. I think the top end of the range would be a 30% year-on-year increase in EBITDA, look, I think it's a pretty strong progression.

All right, guys. Just on Lightning as well, you've given us an 85/15 split on revenue between wholesale and retail.

Are you able to give us an idea about maybe the different margin structures between both of those bit of revenue they contribute to in terms of dollars?

I don't think we're going to give much more detail than we've given in the announcement. We will if we've completed the transaction.

I think we'd probably just leave it at that.

All right. Thanks for that.

Hi, William.

Hey, thanks for taking my question. Just a quick one with respect to Lightning Broadband acquisition and synergy number that you've called out.

Can I just ask what's factored into those synergies? Are you are you effectively factoring in some of those 30,000 lots coming to the market I guess being being effectively active, and you called out sort of five-year in the up to five-year time frame.

Are you are you feeling synergies effectively based on, what you've been what you've already got, 24,000 lots? Thank you.

No, it's synergy based on the business there today. Obviously, growth from here is additive on top.

I think the slide on synergy realization really gives a pictorial perspective on the synergy. These aren't synergies that are premised on firing a lot of people or anything like that.

These are network-based synergies primarily. If you look at the map that we have on slide

36,

you can see in the blue, that is a map of our fiber. A lot of that being the fiber that we purchased through the Uniti Comms acquisition, and then some various other elements of our fiber.

That's an existing asset that Superloop had. If you look at the red dots, that's where we've mapped the Lightning Broadband locations on top of it.

You can see how close those, or how well-mapped those locations are to our fiber. Obviously, that allows us to bring all those sites on-net.

By tails or leased tails, and bring them onto our own network. That's the biggest single line item of synergy, and there's various other network synergies associated with that.

To reiterate, it's off the existing network, it's additive to the $11 million EBITDA that is in the existing business. The future growth comes on top.

Thank you. Then just appreciate that it's been more than a week, but just the AGL contract.

Could you provide some color around whether there will be on that and yeah, just any color around that would be great if there is going to be a break fee. Thank you.

There hasn't been a break. Obviously, we have an existing contract with they advise us that they no longer need our services.

I wouldn't expect any windfall coming out of that. It's not, let's be honest, it wasn't an unexpected outcome.

I think even with yourself, William, we had a lot of discussions about whether we'd be able to keep AGL after we won the Origin contract. It also isn't such a material part of our business.

I think we put out a release saying it represented around about $4 on a annualized basis. Not a particularly unexpected event.

I wouldn't expect any windfall one-off. There's only so much we can say about a commercial contract.

Thanks very much.

Morning, guys. Thanks for taking the question, and congrats on the consumer segment.

Obviously, the market was obviously very active last year, and appreciate your comments on subs growth. Any observations that you're seeing thus far on market pricing?

Should we be assuming any sort of step change in ARPU or margin expectations as a result?

Look, we've given our mid-term gross margin target. We've maintained that target.

Obviously, we're delivering above that target and have been for some time, and we'd be disappointed very competitive in the marketplace, as you can obviously see, and has been for the last 6 months. We're quite pleased we've been able to maintain our margins in intense competition and yet maintain In fact, accelerate volumes.

I think you can read quite a bit into that. We haven't our margin target in consumer, meaning if things do get even more competitive, then we will be ready to respond.

As I've said many times, we won't lead that race to the bottom on pricing. We'll see what others do.

We're certainly ready to respond to it. We have the artillery to respond should we need to.

I don't know that it can get much more competitive because it is intensely competitive at the moment, and has been since the speed bestowal event coming into the start of the second quarter.

Yep. Very, very helpful.

Then just on the Lightning Broadband business. How should we think whole smart communities business, and how much of a step-up in capex can we expect into '27?

Look, the smart communities business business, we've we've make make no secret of that. We're delighted to spend capital in the smart communities business, to be to be frank, because it's so it generates such defensible, high-quality earnings with such a, a deep moat and and long-dated returns.

This this acquisition itself, we think, will uplift our capital requirements around about, $8 to $10 million into the future once once we get into a a run rate's position, $8 to $10 million per annum. Again, that's was largely sort of telegraphed as as a core part of our strategy in the future and that that capex in this part of our business would continue to rise with sales success.

The There's no, we only deploy capital on successfully won projects. Returns are are pretty

Got it. Very helpful.

Thanks, guys.

Your high margins and low cost to serve. Can you make some comments as to how sustainable they are, or of when you say Superloop will respond if there is a race to the bottom?

The Superloop strategy for the last five years has been one of efficiency and automation. We're very proud of the network.

We have network ownership economics in an NBN world. We've invested very heavily in automation and integrating all the various acquisitions into a single digital stack.

We've been an investor for several years in AI. We believe that this is a commodity.

The consumer broadband market are shinier and faster and prettier than anyone else's, but fundamentally, it's a commodity proposition. Price will be a feature of this part of the market, and we wanted to make sure that we could have a value proposition.

We think the value part of the market is the long-term defensible part of the market, which is why we've positioned ourselves there. To exist in that part of the market, we've got to ensure delivering a great product, with high levels of customer satisfaction, at a value price.

That's why we've invested so heavily in automation and efficiency. The best metric to explore that, I think, is on slide 16, where you look customer interactions.

Another metric to look at in the customer interactions per customer, obviously, as we've been putting those self-help tools into the hands of customers. Something else to look at is opex as a percentage of sales over the past sort of four years has continued to reduce aggressively, and we think still has some way to go.

That is view that it was the right part of the market to focus on. I would argue that 13.4% opex as a percentage of revenue is probably market-leading.

I don't have everyone else's numbers to hand, but I'd be surprised if anyone else is able to deliver that outcome. That does mean we are fit to continue to make good, healthy margin in a very large, but commoditized category.

That's very helpful, Paul. My second question is, did you say you're not going to disclose the revenue base of Lightning?

No. I didn't say that.

We just haven't disclosed it as yet. We'll give a lot more detail on Lightning's financials when we complete the transaction, which we said will happen in the fourth quarter.

Paul, can you at least tell us how many employees will be coming across?

All of them. I don't have a number.

50-odd. Right.

Okay. Thank you.

No question for me. Thank you.

Hello again. Just two more questions if I could.

One was just unpacking Lightning a little bit more. You talked to $11 mil EBITDA in FY '25, just 20,000k, whatever it is, 14,000 active lots, and then how do we think about lot activation over the next few years?

I obviously got that 30% revenue CAGR. Is that basically how lots activate?

Nick. The way that the FY '27 is worked out is based on a day plus the expectations for build-ins that will be completed in FY '27, and the activation rates that come with that.

Going to have more than 14,000 active, but right now, as of today, we have 14,000 active services.

Gotcha. The more than 14, does that get you to 11?

Is that the right way to think about it?

Yes. With

11 the starting point,

yeah.

Okay. Thank you.

Then just the second question was, is there any sort of material or does just kind of get covered by business-as-usual capex? Thanks, Dean.

Yeah. From a systems perspective, I think we've indicated that the expectation would be around $8 to $10 million on capex associated with supporting Lightning's contract book.

I think that sort of represents what we'd expect to see as we build out the 30,000 contracted book. From a financial perspective, what excites me is the fact that not day-one earnings, but the fact that we have a contracted book of 30,000, which is more than the actual built network of 24,000.

When we talk about growth in revenue and earnings, that comes from clear visibility into that contract book, and modeling that out going forward.

That's great. Thank you.

Thanks. Morning, guys.

I might just flesh out Nick's question in EBITDA for more than 14,000 lots. Is there much of a cost base, and how does the operating leverage look within that as you ramp up?

Yeah. We've indicated that the Lightning Broadband business has high margins.

Essentially, what we have is once you connect a lot to that network, you have a really quite a fixed cost, and you have high margins ongoing. There's capex required to build out to a building, connect the buildings, and then on an ongoing basis, you have a high GM.

What was the

I'll push my luck and go more direct on it then. The 54,000 lots, what would you say is the

Our intent will be to have billing customers in every single one of those lots. Now, that's unrealistic to think that you're going to have every single lot filled.

I think the best proxy to look at, Cam, is NBN. The earnings profile, the pricing, the fill rates, all those sort of things, it's a pretty good proxy for way that the smart communities business in general will pan out as it does for our competitors.

The key thing is winning the development and getting the statutory infrastructure provider protection, getting the registration, owning the fiber in each of those lots, and then having the patience to wait to put the capital and then wait for the earnings to come in. In the long run, we would want to fill the vast majority of those lots, and obviously, it's a high

Yep. Okay.

Then, last one for me. The addition of Lightning, how high does that group number sort of rough annual target go?

We haven't an organic sales target. That's a live discussion, but obviously, it has to increase from here.

The market is only as big as the market is big, though, there's a limit on how much we can grow organically on an ongoing basis. Combined now, we have some 170,000 contracted lots as we've said.

It's a focus for the business. We'll continue to try and grow from here.

Thanks, guys.

Yeah. Hi, guys.

I guess I'm trying to get at the same thing, which is understanding the incremental margins. If you've basically got incremental margins in the group of about 30% versus what you reported for the period, you're adding further high gross margin revenues with Lightning.

Is it fair to think that there's upside incremental margin that's sort of in expectations at the moment?

You mean EBITDA percentage over time? We currently report our smart communities business in business, but we will probably review that in time.

Overall, as the proportion of wholesale and smart communities grows as a proportion of our overall earnings, then yes, of course, the group margin quality will rise.

Perfect.

Then. Thanks everyone for taking the time.

I know we've taken the full hour, but we do think this is a really important result for the business. As I mentioned before, we're very proud of the first-half result, the growth in the top line, the growth in the profit, and particularly the cash that the business is throwing out.

We're excited about Lightning Broadband and what it means for the group. We're pleased we've been able to uplift guidance for the full year, and we're pretty pumped about the outlook from here.

Thanks all for your time and wish you a good day. Thank you.