Corporate Travel Management Limited

Thank you for standing by and welcome to the CTM Investor presentation. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during Q&A time, simply press star, followed by the number one on your telephone keypad. And to withdraw your question, press the star one again. For operator assistance throughout the call, please press star zero. And finally, I would like to advise all participants that this call is being recorded. I'd now like to welcome Chairman Ewan Crouch to begin the presentation. Ewan, over to you.

Thank you. Hello everyone and thank you for joining today's call. I am Ewan Crouch, Chairman of CTM. On the call with me are Anna Peterson, our Managing Director and Group Chief Executive Officer, and James Spence, our Chief Financial Officer. Shortly they will talk through our strategy, our financial year 25 results and our forecast financial year 26 results. However, before we begin, I want to acknowledge again the patience and support of all our shareholders and all our stakeholders throughout what has been an exceptionally difficult period for CTM. The company's extended training suspension is a matter of deep regret to the board and management team. Over the past year, the board has overseen an extensive and highly rigorous examination of the issues identified within the UK business. As those issues emerged, the scope of work expanded significantly, ultimately becoming a comprehensive review of holistic activities, sorry, historical activities, financial reporting, systems, controls and governance processes in a holistic way. Put simply, no sign has been left unturned. While the underlying issues related to conduct, documentation and accounting practices within parts of the UK business, our focus was not simply on identifying what went wrong. Our responsibility was to ensure that we fully understood the causes of those issues the extent of their impact, and the actions required to improve the business of the future. That process involved exhaustive forensic review work, extensive engagement with customers and financing partners, and a fundamental reassessment of systems, controls, and governance arrangements. The Board has deliberately expanded the scope of the review to ensure all relevant matters were thoroughly investigated and addressed. It became a far more extensive exercise than initially anticipated, but one we believe was necessary to restore confidence in the company and establish a sound foundation for the future. As difficult as this process has been, it also gives us confidence going forward. It has provided an opportunity to thoroughly test the organisation, our systems, our processes, our governance frameworks, and our culture. Today, CTM is a better governed organisation as a result. We have implemented significant changes across the business and have a much clearer understanding of where we need to continue investing and improving. Importantly, throughout this period, our people have continued to serve our clients with professionalism and dedication, maintaining the high standards that have long underpinned CTM's service reputation. On behalf of the board, I would like to thank our employees for their resilience and congruence. I would like to thank our clients for their continued support and thank our shareholders for their patience throughout this process. I would also like to acknowledge the impacted UK customers who engaged constructively with CTM throughout. We are grateful for their willingness to work with us to reach fair and practical outcomes. and we thank them for their ongoing support and continued working relationships with CETEO. We also recognise that our work is not complete. There are elements of remediation still to address directly with customers and board renewal and succession planning remains an important priority and that process is underway. Looking ahead, our focus must now be firmly on execution. In the months and years ahead, We need to do everything we can to deliver on our strategy and create value for shareholders. I would also like to acknowledge our Managing Director and Group Chief Executive Officer Anna and her leadership team for the way they have led the organisation throughout this period. Throughout the challenging and demanding process they have remained focused on supporting our people, serving our customers and positioning the business for the future. I have much confidence in Anna her leadership team and the board of organisation to execute on the clear strategy outlined in today's presentation. Let me now hand over to Anna to discuss the CTM of today and the progress made across the business and the opportunities ahead. James will then take us through our financial position before we open for questions.

Thank you, Dylan. Before we begin, I would like to acknowledge the traditional custodians of the lands on which we meet today and pay my respects for elders past and present. I extend that respect to all Aboriginal and Torres Strait Islander peoples joining us today. We move on to the next slide. I'd like to say good afternoon everyone and thank you for joining us. To the next slide. Before we move on I want to Very importantly, acknowledge the leadership team at CTM. We've deliberately strengthened the group executive over the past 12 months, bringing in experienced leaders across commercial, legal, governance, people and business transformation. This team has clear accountability for both strengthening the foundations of CTM and executing the strategy we're setting out today. We're continuing to build out the executive team in a number of areas. I have confidence in the capability we already have around the table. So to the next slide, there are three parts to today's presentation. I'll start with CTM today and the work that we've done to strengthen the business. James will take you through the FY20 final results, which will also touch on CTM's forecast FY26 numbers. to cover our current financial position. I'll return at the end to take you through our strategic pathway and when we see the opportunity to create value from here. For those of you that are looking for more detail, we've included regional reviews, our governance policy program and additional financial information in the appendix. So let's move on and let me start with the business that we have today. So there are three things I'd like you to take away about CTM today. First, the underlying business has remained resilient. We delivered approximately $9.6 billion of TTV in FY25 and retained approximately 97% of client TTV through the FY26. Our underlying EBITDA was $83.6 billion in FY25 and is forecast to increase to 113.6 million in FY26. We also continue to win and retain business with 669 million of new business wins and 1.5 billion of renewals during FY26. Second, remediation is well advanced. We've made substantial progress on the UK matters. Peace settlements have been agreed. The major exposures have been quantified and the refund program is supported by committed funding. First, we've made significant progress strengthening the foundations of the business and that includes stronger leadership, governance, controls and accountability alongside committed funding to support the business through the remediation period. If we look at these together, it gives us confidence that while the issues we've been addressing have been significant, they've not changed the fundamental strength of our client franchise or the opportunities ahead. Our focus now at CTM is disciplined execution and turning those strengths into sustainable value creation. We continue to the next slide. Ewan has already covered the work undertaken to understand the issues and the board's response. We want to focus on what has changed commercially. In the UK, we've strengthened leadership and accountability. We've reviewed key client contracts and strengthened oversight of how those contracts are interpreted and delivered. We've also strengthened financial reporting, reconciliation and documentation controls with clearer approval and installation requirements. The focus now is on embedding that discipline into the way the business operates every day. On to the next slide. The lessons, however, are broader than the UK, and that's why the governance of this program is worldwide. This comes down to four things. Clear accountability and decision rights, data we can rely on, stronger risk and financial controls, and stronger assurance. In practical terms, that means clearer ownership, better quality information, more consistent controls and stronger independent challenge across the group. And for us, the test isn't whether we have new policies. It's whether we have better decisions, earlier escalation, clearer accountability and better visibility across the group. That's what we're working to embed.

So moving to the next slide.

with stronger foundations being put in place. Our focus now is firmly on the business ahead and translating that into sustainable, profitable growth. The pathway you see here is deliberate, but it's important that I also emphasize that the phases are not sequential. They do overlap.

Growth continues now. What changes over time is the intensity and the mix of the growth cleavers.

In strengthening, Our immediate priority is leadership, particularly around governance and controls, restoring stakeholder confidence and maintaining disciplined execution. But that doesn't mean we're waiting to rebuild commercial momentum. As we accelerate, the emphasis increasingly shifts to growing TTV, improving revenue quality, scaling our technology and data capabilities, and driving greater productivity and operating leverage. And as we scale, the opportunity is to extend what is working, growing higher margin revenue streams, capturing more value from our global ecosystem, and selectively investing in capabilities where we see attractive returns. So this is a sequence where we strengthen the business and then start growing. We are doing both right now. The balance simply changes as we move through the pathway. So over to the next slide. None of this can happen without our people. Through a very demanding period, our teams continue to serve clients and retain key relationships with approximately 97% CCB retention in FY26. Employee turnover also improved from 13.8% to 12.4%. helping us retain the experience and capability we need to execute. We're now building on that strength through clear expectations around leadership behaviour and accountability, supported by our new CTM culture statement. And the aim is simple. We want to retain the service culture and the expertise that differentiate CTM, while strengthening accountability and performance discipline. Let's do the next slide. Before I hand over to Jane, the key message is that the fundamental strengths of CTM remain intact. We have long-standing client relationships, high retention, deep travel expertise and differentiated technology and content. We have continued to retain significant clients. We've continued to win new business and operate through a very difficult period while strengthening the foundations of the group. What we are changing is the discipline with which we manage the business and convert those strengths into stronger returns. The opportunity ahead is to create more value from CTL's existing scale, client relationships and capabilities. James will now take you through the financial decision in detail. Thank you.

Good afternoon and thank you, Anna. I'm pleased to be providing these results today as we work towards return to trading on the ASX. But at the same time, I also want to acknowledge that this has been a very difficult time for CTO investors. So moving to slide 15, this summarizes the three customer remediation issues that have now been identified, investigated, and quantified as part of the review process. Starting on the left-hand side, These are the key UK client contracts that have been a focus of our work over the past nine months. In simple terms, certain UK customers were charged amounts which were in excess of CTM's contractual entitlements. But this has been the subject of our detailed disclosures, particularly in April of this year. Following a detailed review, those matters were self-reported to impacted clients, and we've been working through a remediation process with them. This has been a significant exercise, requiring us to review contracts and transactions going back more than six years. As a result, we have now quantified the accounting liability in relation to these matters at $234 million as at the 30th of June, 2026. We have agreed approximately $167 million of refunds related to those contracts with Q-impacted clients, of which 20 has already been paid. A further 23 million of refunds have been agreed on active UK contracts entered into in FY25, which remain on the foot. The remaining balance largely relates to the number of impacting customers, where discussions are ongoing, with $21 million towards the final settlement. Turning to the middle section of this chart, this relates to Europe air margins. This issue came into focus later in the audit process, where we identified The issue relates to certain airline fares purchased under wholesale and commercial arrangements where a margin was retained, but certain client contracts did not clearly contemplate this margin being retained by CTM. We've now completed the work required to understand the issue and quantify the liability, which is $29 million at that 30th of June, 2026. is underway, and while there remains work to do, we now have a clear understanding that the exposure has brought the way to resolution. Finally, on the right-hand side, this relates principally to remakes received from suppliers in ANZ, where CTM had contractual obligations to pass those amounts back to clients. The accounting liability has been quantified at $13 million as of the 17th of June, 2026, which remains within our previously disclosed range of $10 to $15 million. In addition, we recognize a further $6 million in other contract-related matters identified through the broader process of review. Overall, the key message from this slide is that we've identified the issues, quantified the liabilities, and have reached settlements for the majority of refund liabilities, 78%. While there is still work ahead to finalize all outstanding assets, we now have a clear understanding of exposures and the defined pathway to resolution. On slide 16, this highlights the strength and resilience of the underlying business, particularly the bounce back in revenue and underlying limit DA from FY 2018. Starting with CTV on the left-hand side, we delivered $9.6 billion in FY25, up from $9.1 billion in FY24, and we expect that to increase further to approximately $9.8 billion in FY26. While revenue is stable from FY24 to FY25, we're forecasting an increase in FY26. Similarly, in underlying EBITDA, an increase is forecast for FY26, following the reduction in FY25, as you can see on the right-hand side. A significant element of the reduction from FY24 to FY25 in underlying EBITDA relates to the ANZ region and primarily reflects commissions that have been reversed and additional bad debt expense as part of the remediation process for historical matters. Outside of the ANZ and Europe regions, adjustments in FY25, the underlying business remained resilient. North America continues to crawl strongly, with growth in both TTV and revenue, while Asia remains stable. Europe was lower year-on-year in FY25, reflecting lower special project activity, which picked back up in FY26. What this slide demonstrates is that CTM continues to operate a large-scale global travel platform with nearly $10 billion in TQV, more than $640 million of revenue, and meaningful earnings generation. The key takeaway is that while remediation issues and associated accounting adjustments impact a reported profitability in FY25, the strength of the underlying operating performance can be seen in the forecast financial metrics for FY26. Slide 17 looks at transaction volumes, which is one of the clearest indicators of the underlying health of the business. The first point to note is that transaction activity has remained resilient throughout FY26. Across the group, transactions increased from 16.2 million in FY25 to 18.3 million in FY26, reflecting continued client activity and underlying demand across our markets. The monthly run rate also remained relatively consistent through the year. While there are natural seasonal fluctuations, We've not seen any material deterioration in transaction volumes as a result of the issues we've been discussing today. One point to call out is the software results in April 2025, which coincided with the period following the US Liberation Day announcements, which created broader market uncertainty and resulted in reduction in travel activity, particularly in North America. Those impacts were relatively short-lived, and transaction activity recovered in subsequent months. Another message from this slide is diversification. As shown on the right-hand side, our transaction base is spread across regions. AMZ accounts for approximately a quarter of transactions. North America around 34% to 36%. Asia approximately 15% and Europe around 25%. That diversification demonstrates the business is not reliant on any single geography, customer group or economic cycle. So overall, this slide reinforces two key points. Transaction volumes remain strong, and the diversity of our global platform continues to be one of CTO's core strengths. Moving to slide 18, which looks at EVTA on a half-and-half basis over the last two years, and provides a view of the run rate and underlying earnings profile of the business. The main takeaway is that the underlying run rate of CTM has remained relatively resilient throughout the period. Starting with FY25 on the left-hand side, EVTA reduced from $57 million in the first half to $26.7 million in the second half. When we adjust for prior year adjustment items at $12.7 million included in the underlying ANZ result, the adjusted underlying EVTA is $39.4 million These adjustment items relate to commission income previously on the balance sheet that had been recognized in prior years based on an expectation it would be recovered from hotel suppliers. As part of our review processes, we determined those amounts were no longer recoverable and therefore reversed the revenue. Additionally, we recognized additional bad debt expense on items related to prior years. Turning to FY26, First half even TA is forecast at 66.9 million, compared with 46.7 million in the second half. The primary driver of that movement is Europe. During FY26, Europe benefited from special project activities, particularly in the first half. Activity levels reduced in the second half due to lower underlying client activity. We continue to see opportunities in further project activity in the Europe regions. has recently announced we secured the UK Ministry of Defence contract. We expect that contract, together with other opportunities, to contribute to activity levels and earnings generation into FY27. Another point to note on this slide is the consistency of contribution across our regions. North America, Asia and ANZ have all continued to generate relatively stable earnings through the period, reflecting strong client retention. Slide 19 moves the discussion from accounting liabilities to actual customer settlements and cash outcomes in respect of UK matters. Starting with the top chart, this bridges the UK customer-related liabilities we announced to the market in April through to the position at 30 June 2026. At a high level, we currently have approximately $234 million of customer-related liabilities on the balance sheet at 30 June 2026. The starting point is the $10260 million liability reflected on our June 2025 accounts on the left-hand side of this chart. The movements from June 2025 to June 2026 include firstly, amounts refunded during the period in cash of $23 million to impacted clients, around $21 million flexed foreign exchange movements associated with translating UK liabilities into Australian dollars between the balance sheet dates. There's then a further 18 million increase in liabilities in the period relating to active contracts. This is the term we use for specific large-scale UK contracts which will remain on foot and reflect amounts received during FY26 that have been incorporated into the liability balance We have now reached an agreed position on these matters with the relevant clients. Once we move from liability assessment into direct negotiations with customers, a number of settlements are agreed at amounts lower than the accounting liability. As a result, settlement outcomes will reduce the liability by approximately $36 million This reflects that there were contractual uncertainties and key customers, together with CTM, were motivated to reach settlements. What that means is that while we carry a liability of $234 on the June 26 balance sheet, we have now agreed or closed the final customer settlements totaling approximately $191 million, with $7 million remaining to be remediated. A key point is that there is now significantly greater certainty around both the amount and the timing of customer remediation. That leads to the bottom chart. This chart shows the payment profile of those agreed settlements. Of the $198 million of expected settlements, $191 million is already subject to formal payment plans with agreed customers or close to finals. Those arrangements provide a high degree of certainty regarding the timing and quantum of future payments at a stage through to Q1 FY28, rather than being payable immediately. There are no interest costs associated with the staged payment plan. This reduces near-term cash requirements and allows remediation to be managed in an orderly and sustainable manner. The next slide focuses on cash movements during FY26. On the right-hand side, you can see we finished FY26 with approximately $107 million of cash on hand, despite a significant number of cash outflows during the year. Starting on the left-hand side, The business generated $114 million of underlying EBITDA during FY26, demonstrating the ongoing cash generative nature of the underlying platform. Against that, as we move towards the right, you can see we've incurred non-recurring costs of around $30 million associated with the forensic review legal advisors, consultants, and other activities required to investigate and address the issues identified through the review process. This has obviously been a significant expense for the business. In terms of working capital, in the middle of the chartering FY26, CTM transitioned to a daily settlement cycle with IATA, which resulted in approximately $14,040 with the other working capital outflow. Following completion of these financial statements, we will re-engage with IATA regarding these terms with a view to reverting to our previous terms over time. This impact was partially offset by approximately $18 million of working capital inflow related to active contracts, which we now agreed with the relevant customers to refund. Note also the $23 million of customer refunds that were already processed, that were already paid to customers during FY26, as part of the remediation process. And finally, as you can see, we invested $29 million in capital projects, reflecting our continued commitment to invest in proprietary technology, which we see as a key part of our competitive advantage at customer service. Turning to slide 21 and taking a look at the funding and balance sheet position of the group, which reflects our recent announcement on new funding arrangements. Starting on the left-hand side, the chart sets out the expected sources and uses of cash through calendar 2027. In terms of sources, starting from the bottom, we have cash on hand of $107 million in June 30th. At the top of the chart, you can see we have committed facility of $175 million as recently announced, which I'll describe in more detail on the next slide. Additional sources include the business as usual cash flows, which we forecast to be $36 million, and as we previously referred to, we now estimate tax refunds of $62 million. being a combination of VAT and refunds of UK income tax paid between FY23 and FY25. On the right-hand side of this chart, you can see the use of funds, including total customer refunds of $246 million previously referred to, which leaves cash, work and capital, and funding buffers of $134 million. This shows the balance sheet has been standardized substantially strengthened with buffers as we manage through this period of refunds. On the right-hand side, we're including a profile of expected brawl debt and cash on hand through to the end of calendar 27. We announced at the time of the new funding announcement this week that we forecast annualized interest costs for the group of around $20 million through FY27 and FY28. Slide 22 provides more detail on the debt facilities we put in place to support the business as we work through the remediation process. Following discussions with our existing syndicate and new lenders, we announced this week new financing arrangements. These facilities are provided by a high-quality institutional lender, Epcredit. The outcome is a $175 million permitted debt package comprising a combination of term debt and revolver facilities, providing us with additional flexibility and financial capacity. The terms of these facilities are set out in the ASX announcement we made earlier in the week. These facilities will sit alongside the facilities provided by our existing syndicate of lenders, which have been restructured to meet our business requirements. Drawdowns will occur progressively from now and broadly will be in line with customer repayment obligations. Slide 23 covers the Goodwill Impairment recognised as part of the FY25 accounts. Most of this has already been disclosed to the market, particularly in relation to the European segment. As part of the finalisation of the financial statements, we reassessed the carrying value of Goodwill across each of our reporting units and updated assumptions around earnings, cash rate forecasts, discount rates and the current cost of capital. The most significant outcome was a full impairment of the European Goodwill balance of $192.1 million. Given the issues we've discussed throughout today's presentation and the updated outlook for the region, we consider this to be the appropriate accounting treatment. We also recognize partial impairments in ANZ of $89.1 million and North America of $76.5 million. These were driven by changes in valuation assumptions, including a more conservative forecast on growth rates, increased cost of capital, and investment in government. These are non-cash accounting adjustments and do not impact the group's liquidity or cash position. Before moving to my final slide, I'll make some comments on the audit opinion. There are qualifications in the audit opinion, and I'd suggest that analysts refer to the detail of that opinion. I would note the following. The qualifications relate to the European region, and mostly relate to historic restatement matters where insufficient audit evidence was available. There are no qualifications where errors have been identified. And finally, the audit opinion in relation to going concern is unqualified. So the final slide in this section is slide 24, which provides an update on training in the first month of FY27. The business continues to fall broadly in line with our expectations. Transaction volumes have remained resilient, increasing from 1.5 million to 1.6 million, compared with the prior corresponding period. That gives us confidence that underlying customer activity levels remain healthy across the room. CTB is stable at approximately $830 million compared with $840 in the PCP. Revenue is modestly lower, reflecting a combination of mixed effects and a timing of activity across regions. It's also worth noting that some of the due political uncertainty which impacted business travel earlier this year, particularly around the start of the Middle East conflict, is moderated. We continue to monitor the environment closely. Business travel activity has remained relatively resilient. We're also continuing to work special project work across the group, including work associated with the recently announced UK Ministry of Defense contract. In relation to capital management, dividends remain suspended at this stage. Our priority is to complete the remediation process, continue to strengthen the balance sheet, and return the business to a over time. Further guidance will be provided at the Annual General Meeting in November. And with that, I'll hand back over.

Thank you, James. So, you've heard what the Minister said today. Allow me now to focus on where we take CTM from here. But to the next slide. We believe corporate travel is entering an important period of change. Technology, data, automation and AI will increasingly simplify the travel experience. But in complex corporate and government travel, human expertise, judgment and service will continue to matter. Our opportunity is to combine the best of both. Intelligent technology operating in the background with experienced people with human expertise and status. That's what we mean by the science, intelligence and the visible human hand. And importantly, we believe this model can deliver both a better client experience and better economics to CTM. So the next slide. Here we summarise the strategic shifts that sit behind the next phase of CTM. CPM has grown successfully as a collection of regional businesses. That gave us local responsiveness and entrepreneurial strength, but it also created complexity, duplication, and in some areas, limited our ability to capture the full value of our global scale. We see four important shifts from here. First, from regional to more global. not by removing local accountability, but by applying stronger group standards, common measures, and better visibility so that we can make better commercial decisions and leverage our scale more effectively. Second, a more connected and scalable technology environment. We will continue to invest in proprietary capabilities such as lightning and sleep space, while using data, automation, and AI more consistently across the grocery. The objective is better client experiences, faster deployment of capability and a lower incremental cost to grow. Third, a much greater focus on revenue quality. TPV and transactions remain important but growth has to translate into appropriate returns. That means greater discipline around pricing and deal economics, more value from our existing client relationships and stronger supplier economics. greater operating leverage. We want technology and automation to take more of the repetitive work out of the system, allowing our people to focus their expertise where it has the most value and enabling CGM to grow with our proportionate growth in our cost base. Underpinning all four shifts are stronger governance and accountability, trusted data and more integrated global leadership. When we take these together, these changes are about getting substantially more value from the platform CTM already has. To the next slide, this is what leads us to CTM 1. This brings the strategy all together and this is how the different parts of the strategy reinforce each other. It starts with a better client experience. Better technology, better content, better information combined with our people applying their expertise where it matters most makes BTM more valuable to our clients. That then drives deeper client engagement and that results in stronger retention, greater share of wallet and more opportunities to expand what we provide. And deeper engagement then creates the opportunity for higher quality revenue, not simply more transactions, but better pricing, stronger deal economics, greater attachment of adjacent services and better supplier outcomes. And as that revenue grows, technology, automation, standardisation and our global scale allow us to convert the four of that growth into operating leverage, growing the business with an ultra-proportionate increase in cost. and that creates capacity to reinvest in CTM, to reinvest in our people, our technology and the client experience which strengthens the cycle yet again. Across the entire flywheel sits our data, our human expertise and increasingly AI orchestration. They help us understand our clients better, make better commercial decisions, automate more effectively and make each part of the cycle work harder. The outcome for CTM is higher quality growth, and that means better client outcomes, stronger revenue economics, and a more scalable business. And that is where our focus is now, on the business ahead, with a stronger platform, greater discipline, and a clear growth model for CTM. Ladies and gentlemen, that brings me to the end of today's presentation. Thank you for your time today and for your interest in CTM. You and James and I are now happy to take your questions. Thank you.

Thank you, Anna. And as mentioned, we will now begin the Q&A session. For those listening by phone and would like to ask a question, please press star followed by one on your telephone keypad to raise your hand and join the queue. And to withdraw your question, simply press star one again. When called upon, please use your handset, ensure your line is unmuted and be ready to ask your question. and today we kindly ask that you limit your questions to one and one follow-up per person so we can accommodate as many participants as possible. Again, that is Star 1 to raise your hand and join the queue and your first question is from the line of Weiwen Chen of RBC Capital Markets. Please go ahead.

Hi guys, thanks for this. So just, I think one question I have is the 8th century listing What is required from here? What is the timeline? And does the qualified opinion on the FY25 accounts impact this?

Hi, William. It's James here. So we've announced today the FY25 accounts and YH26 accounts, and we've also said that the FY26 accounts will be released early next week. It will then leave the ASX to determine when relisting occurs. We don't expect the audit opinion to impact that, but it's a matter for the ASX.

Okay, cool. And then my other question was just, is the message here that the earning stake is around that $113, $114 million from which you plan to kind of grow it from? And how much are we reading to close July trading being about 9% down at the revenue line?

We are not providing guidance for FY27 today. We intend to provide an update at the AGM to take place in November. What we've done today is set out the run rate of the business and demonstrated the resilience we've seen We provided July to be transparent and provide an indication of how the year has started. You can see that the activity level remains at or slightly above prior years. Revenue mix and other factors are the July numbers, but we will provide an update at the AGM on quarterly performance.

Okay, thank you. I'll rejoin with you.

And a reminder, if you would like to ask a question, to press star 1. And your next question is from the line of Tim Plum of UBS. Please go ahead.

Hi, guys. Thanks for taking my questions. I appreciate it. It's been a challenging time. I wanted to focus a little bit on slide 18, if that's possible, just having a look at the first half, second half, and obviously in the UK there's a fair bit of movement between those halves. So when we look at that second half, is that fair to look at that as a BAU sort of half of earns? And maybe can you explain a little bit how to think about the UK within that number because EBITDA contribution looks looks pretty low. So I don't know if there are, you know, costs that are coming in, offsetting some of the project, like for the project work that's not there. And if it is a clean set of numbers, is that how we should be thinking about the business going forward? Historically, you know, the seasonal split of the business has been kind of 40-60, 45-55. Does that still apply with the business the way it is today? That's my question, please.

Thanks Tim, I'll take that. So you can see on slide 18 that there was a reduction between 1H and 2H in terms of the European numbers. What we referred to is that special project activity levels were higher in 1H than 2H. and that has impacted the UK and European performance between those two halves. In reference to the last question as well, we're not giving an indication going forward in terms of the run rate of the business. We think what you can see in this run rate is the consistency across ANZ, North America, and Asia. We've also announced recently ongoing work with the UK MOD. I don't think there's much more to that.

Got it. Is it fair to assume then in the second half, if you think about the UK business as two separate parts of the business, the special projects work and the core UK or Europe corporate travel work, How do we think about the EBITDA contribution? Like, if the special project work wasn't there, is it loss-making dragging down the earnings in Europe in the second half?

All I'd say to that is we're not splitting out the different components of the business in the UK. Europe will look further into that going forward potentially, but really there is a contribution from the special project work which has impacted the 1H, 2H figures, but we're not going to go into breaking down the profitability of individual components of the UK business, UK and European business at this stage.

Got it. Okay, so just confirm, that second half is like a reflective kind of BAU, how we should think about the business going forward?

No, I didn't say that, Tim. I said that, you know, this is the combination of all of the activities of European business. I said that there's additional work that we've talked about going forward. But you can clearly see that the European business profitability, unlike the three other core regions, does fluctuate more, and that is driven by, at the moment, special project work. Clearly, strategically, our aim is to continue to build the corporate work that we do in the European decades. Thank you.

Sorry, not to harp on, but just so that, is there any reason why the margins for the traditional part of the European business would be different to ANZ in North America, like low 20s? Is there anything structurally different over there?

We haven't written that here. I mean, there are differences clearly between the different businesses. The business mix, in the UK has been different to the business mix in the other regions. So it's not, you know, you cannot read into these results that, you know, all regions would have the same margin. That's not the case. You're probably aware, too, that our Asian business has a higher wholesale element, which is lower margin, for example. So you can't really directly compare the different margins of the different regions.

Okay, thanks guys. I'll jump back in with you.

And your next question comes from the line of Belinda Moore of Morgans. Please go ahead.

Good afternoon, everyone. If we could just turn to slide 24 in the July trading update. Is a big component of sort of TCV and revenue coming off the higher A dollar? So what would be the trends there in constant currency, please? Thank you.

Sorry, Belinda, you're going to have to repeat that question.

Okay, James, on slide 24, please, just where you give the July trading update, is the reason TPV and revenues are falling, is that literally just given a higher A dollar? What's sort of the growth rate trend in constant currency, please?

I can't give you the growth rate trend in constant currency. I'm sorry, I don't have that. But if you look at the revenues, you can see that there is a modest reduction. There are a number of different factors here, and we're not unpicking the different factors. You can see from the previous slide and the previous discussion that that special project work in the UK was lower in 2H than 1H, and there'll be an element of that. There will be an element of currency, but also July is a month due to holidays in the northern regions where you can see relatively small fluctuations in activity impacting group revenues. So I can't give you any more than that, but I'll draw that question.

Am I allowed a follow-up question, please, on slide 18? If we look at corporate costs in the second half 26, is a 16.4 annualised sort of the new base we should be thinking about for this business going forward?

Yeah, Belinda, you're certainly right to identify that corporate costs have gone up. I can't say that 33, which is the 16.4, doubled up is exactly the right number, but it is right to assume that our corporate costs will be trending higher than previous periods due to in governance and controls activities that we have in line with what you've heard us talk about earlier on today, particularly the governance focus that Anna has referred to. That is going to be reflected in higher corporate goals going forward.

Thank you.

Your next question is from the line of Mitch Sonigan of Macquarie. Your line is open.

Yeah, hi guys. Thanks for taking the questions. Just in terms of re-contracting when you're re-tendering and having that higher retention, are you seeing maintenance of pricing from previous contracts or are you seeing any downward pressure on that? Thanks.

Thank you for your question. We're still seeing renewals at no different than prior years and we're still seeing strong activity in our pipeline. We've been very focused on building a very robust pipeline for the future and we measure our pipeline through a weighted probability and we're very satisfied with the spread across our pipeline as it stands at the moment.

Okay, thanks. Next one, just in terms of the refund program, for customers that have agreed to take on refunds, do they waive any right for further legal actions? What are the risks of civil legal action in terms of clawing back things like interest or any other potential risks from a legal perspective from those customers that have agreed to it and also ones that haven't yet agreed to any NER resolution?

Thanks very much. This is a really good question, an important question. We have had very collaborative discussions. UK. They have worked with us over the last several months and we are pleased to have reached finality with those customers on some very important historic matters. We're not going to go into the details of the specific settlement agreements, but we are comfortable that this draws a line clearly under the matters that we have identified and worked with them to resolve over the last several months. We have ongoing relationships with these customers and are pleased to be able to provide support to their businesses. Okay.

Thanks, Sam. Thanks.

We have a follow-up question from Wei-Wing Chen of RBC Capital Markets. Your line is open.

Hi guys, yeah, just two more follow-ups for me. So I'm sure, I guess, all options are on the table for you guys during this period. Just wondering whether you solicited or received any offers to acquire CPM, either at its entirety or otherwise?

I'll take that question. We're fully conscious of our disclosure obligations throughout the entire period that our shares haven't been traded. We've still been subject to the same disclosure obligations. and if we had something to disclose in relation to that. Okay, cool, cool.

And then the other question I had was just in your uses and sources of funds. There is a decent amount of funds predicated on getting taxed back from the UK government. I was just wondering whether you've got like an in-principle agreement or something like that, that you're eligible for a refund of historical taxes, Dave?

Thanks, I'll take that. So these tax refunds identified as $62 million comprise a mixture of VAT and income tax. There are recognized processes for refunds and we are engaged in those refund processes and working through them. I'm not going to say more than that on this matter. We have clearly paid significant amounts of tax on previously reported profits and will be seeking refunds over the coming months. Okay, thank you.

And you have a follow-up question from Tim Hum of UBS. Your line is open.

Hi, guys. Thanks for taking my second question. This one's around slide 36 and just looking at the client retention. So impressive across the board, 94% in Australia, but that's for a 12-month period. Is that reflective of the entire year and maybe can you give us a bit of a sense for like fourth quarter or second half 26 in terms of client retention that you saw there? The other parts of the retention story, maybe can you tell me if I'm doing my maths wrong, but if you had 97% retention rate and You put it across the 9. It looks like you've lost about 300 nil of TTV. You've won 1.5. So does that mean that you've had about 1.8 bills that's gone up for retender, of which you've won 1.85? Is that how we should read it, or am I doing that wrong?

Yeah, you've done the correct math there. Just the 1.5 is renewals. and we have won, in addition to the $1.5 billion of renewals, $669 million of new business weeks.

And just, sorry, the first part of the question in terms of the retention rate through the first half or second half or maybe exit last quarter, has there been any material or notable drop-down in terms of retention rates?

Oh, not whatsoever. We've really seen the retention rate stay stable across first half and second half. As I said earlier, you know, we've really, really focused on the core of the business and it's certainly not seen no structural loss.

Great. That's great, guys. Thank you.

Thank you.

And in the interest of time, we do need to conclude the Q&A session there. I would like to turn the call back over to James Spence, Group CFO, for closing remarks.

I'm going to turn the call back over to Anna Peterson, Group CEO, for closing remarks.

Thank you, James. I just want to thank everybody for attending today's webinar and for your Q&A. I do want to acknowledge that we certainly do recognise the significant impact and the uncertainty that this process has created for all our shareholders, our customers and employees and business partners alike. We are a very different company today and we are very focused on the CTM of the future. So thank you everyone for attending.

This concludes today's conference call. Thank you all for joining us.

You may now disconnect.