Genesis Energy Limited

Kia ora koutou and welcome to Genesis Energy's first half of FY22 results presentation. I'm Mark England, the CEO, and next to me here is Emma Oletti, the Acting Chief Financial Officer. We'll take you through this in stages. I'll give you a few highlights, hand over to Emma to talk about the financial highlights, and then I'll come back and talk about operational and strategic matters. So, starting with our highlights on slide five, it's been a strong half for Genesis, really proud of the EBITDAF performance, 210 million and an NPAT of 85 million. Emma will explain the vagaries of that and the ups and downs as a result of various movements. We're announcing an interim dividend of 8.7 cents per share this morning, which is a gross yield of 8.3%. And our operational highlights of customer loyalty and partnering on solar and the first year or first half year of full generation from YP Wind Farm are things we're all very proud of too. Emma will also talk about the sustainable finance framework in a slide later on, which is something we believe we were market first on. What we're highlighting today as well is our social achievements through the half. And calling out three in particular, the NAAHRA Creating Pathways Initiative, which for us is an evolution from our long-running school gen program, which focused on primary school-age children's STEM education now focusing through that pathways, the more senior secondary school education system and sponsoring kids, particularly in our communities that we operate in through special courses. We also use those relationships we had earlier in the year when there was a big push on vaccination drive across the country to engage in the communities and support them with the information they needed to make the choices they wanted to make around vaccinations. Our PowerShout program, which has been running for a long time now, took a step forward in the last half with its gifting, where we offered customers the opportunity to gift their PowerShouts to communities or people who are struggling to pay their bills. And 15,000 opted in for that. And that's great. And we're going to double that as Genesis. And there will be about 130,000 hours offered for winter. And those PowerShout hours, which will be free power, will be given when it's needed most. which is when demand is highest during winter and high demand hours. We do have an ambition to eventually allow our customers to donate their PowerShouts to individuals, family members who they believe they want to support paying their bills too, but that's not yet there, but this is the beginning of it. Menachie Kennehy, which we've talked about before, was really important in the last half, supporting customers who are struggling to pay their bills, and not only referring those customers to WINS and FinCap for support, but also ensuring that as long as they kept paying a little bit of their bill over time, we would stick with them, we wouldn't disconnect them, and through that we've generated a lot of loyalty, which is probably also driving some of that net churn and brand MPS up. When you take this holistically, you're seeing a high performing business, socially responsible and focusing even more so than we have been in the past on a more renewable future for New Zealand. So with that, I'll hand over to Emma to talk about the financial results in more detail, then come back and talk about some of the other operational highlights. Emma.

Wonderful. Thanks, Mark. And good morning, everyone. On to slide 7, which shows our half year financial summary. Genesis has delivered a strong first half. EBITDAF of $210 million is slightly down on PCP. But it's worth noting that half year 21 was a record. And prior to this, Genesis EBITDAF for a first half had never been over $200 million. So it's great to see us hitting above this threshold again. FY22 is a year of investment and an increase in OPEX is primarily driven through investing in our strategy. I will provide more detail on this later in today's presentation. Today, we announced an interim dividend of 8.7 cents per share. This is an increase of 1.2% on PCP and reflects our strong first half and FY22 outlook. Genesis continues to play its part in ensuring New Zealand's energy security, rebuilding the stockpile after a heavy draw last winter. Consequently, inventory has grown, which has had a knock-on impact to operating cash flow and net debt. Slide eight highlights that for the half, we are reintroducing the dividend reinvestment plan. Our desire to grow through the transition and deliver on our strategy requires investment, both in OPEX, as I've already mentioned, and CAPEX. Our plans are moving forward, and directors felt now is the right time to reintroduce the DRP to strengthen our balance sheet and ensure that it can deliver on our future ambition. The half-year dividend of 8.7 cents per share is set to half of the FY21 full-year dividend and a similar trend to what we have done over the last few years, recognising the importance of dividends to our investors and our aim to grow dividends over time. The dividend remains 80% imputed and we continue to pay a supplementary dividend to non-New Zealand residents to ensure tax equalisation. Notably, the dividend as a percentage of free cash flow remains relatively stable at 60%, and the resulting gross dividend yield remains competitive at 8.3%. On slide nine, you can see that Genesis delivered EBITDAF, which is roughly equal to HY21, once an adjustment is made for emissions costs as a result of the beach arbitration that should have fallen in the PCP. Momentum in our retail business continues, with net backs up across all fuels, and our wholesale business proved once again its ability to flex and deliver value in changing market conditions, running short into low prices and long into high prices, which helps support an energy margin increase between the periods. but the half was not without its challenges. The events that unfolded on the 9th of August created a short position where Genesis was forced into the reserves market at very high prices, and this created a one-off headwind. Slide 10 looks at a bit more detail in each segment. Changes in headline segment performance largely reflect changes in the transfer price between the periods. Our retail segment includes all sales to customers of electricity, gas and LPG. Financial performance has been driven by improved netbacks across all fuels as a result of improved pricing and sales momentum continued in our LPG business with customer connections up 8% on PCP. Our wholesale segment covers all of our spot market activities, wholesale sales and generation. After adjusting for the movement in transfer price, the August 9th event and half year 21 emissions, wholesale performance is broadly flat on PCP. On the back of rising commodity prices, a continuing tight gas market and rising emissions, the weighted average thermal fuel cost has increased by over 20%. Rising thermal fuel costs have been partially offset by our portfolio's ability to flex and a full half of Waipipi in operation. This is a great example of our future-gen strategy in action as Waipipi displaces higher cost thermal fuel. Kupe EBITDAF is down on PCP and reflects a reset of prices for the sale of gas and LPG between wholesale and Kupe. Following the successful completion of the inlet compression project, we are expecting a good result from Coupé in the second half due to increased production and higher oil prices. On slide 11, you can see that MPAD is up in the half due to a net favourable movement and the fair value of our swaptions and PPAs, and a realised cash gain relating to coal hedging. We monitor underlying earnings as a better measure of profitability as our reported impact numbers regularly have noise resulting from changes in forecast asset values and fair value adjustments as I've just described. Removing this noise, underlying earnings of 60 million is equal to the PCP underlying earnings of 60 million. Slide 12 illustrates that as we deliver on our strategy, this investment is reflected in the OPEX growth across the period. The key drivers of this increase include planning for the future of Huntly, progressing the biofuels trial, discovery work to re-platform our core billing system, and supporting growth in LPG. During the period, we implemented the updated accounting policy in relation to software as a service costs. This resulted in some CapEx being reclassified as OpEx. And of the three million impact in the half, around two of that relates to work to support our retail digital transformation. Again, reinforcing the message that our key driver of operating cost increase has been strategy. In addition to the inflationary impacts through salary, software and insurance, Genesis has spent over a million dollars to keep its people safe and maintain effective operations throughout this phase of the pandemic. And lastly, in the half, we incurred around $8 million of expenses that we would turn one off in nature, which includes digital transformation project costs, energy online rebranding, and planning for the future of Huntly and solar development. Slide 13 talks to our capital investment. Over the period, we have spent slightly less on capital than PCP due to the completion of several significant projects and the accounting policy change. Full year, we anticipate capital spend of up to 84 million. We distinguish our capital expenditure between stay in business and growth. A number of very important stay-in-business projects were undertaken this half, including investment in thermal resilience to ensure the long-term continued reliability of New Zealand's thermal backup, a major upgrade at Tekapo B, which will future-proof it for decades and improve plant efficiency by 2.5%, And at Peripawa, work commenced on the overhaul of the power station's turbines, one this summer and one next, which will increase plant efficiency by 3.3%. And we continue to invest in projects that create growth. Completion of the coupe inlet compressor being a key contributor, ensuring gas resilience and a return to full production capability. And in our retail business, the PowerShout program is increasing customer engagement. And as our LPG business continues to grow, this is supported with additional capital. Slide 14 covers our capital structure. Despite net debt increasing, we are seeing debt to EBITDA fall due to higher expected earnings in the full year. This provides some headroom, which is supported by the DRP being reintroduced to fund our investment pipeline. Importantly, S&P have reaffirmed our BBB plus rating in February and financing costs are flat with the increase in debt offset by the mix of debt shifting towards floating, which is at lower rates and the roll off of higher priced debt. And lastly, Slide 15. This is one highlight I am personally very proud of, insofar as what we have delivered through the sustainable finance framework, but also what this represents for Genesis, a company that stands for a just transition and gives due considerations to climate, social, community, and people aspects as we transition to a more renewable future. and is willing to put some skin in the game via its sustainably linked loans, which come with higher interest costs if we don't meet our targets. Since its inception, the team have worked really hard, and as of today, 35% of our financing facilities are covered by this framework. This includes $250 million of debt facilities linked to the delivery of our sustainability targets. And now I pass back to you, Mark.

Thank you, Emma. So over the next section, I'll talk about some of the operational context behind those results and then move swiftly into a strategic outlook. So moving on to slide 17. We've talked about engagement before, but at Genesis, I think you all know engagement for us is core to our retail vision. It's about giving customers a reason to engage beyond the bill. We've been focused on it for years and we're starting to see some of the fruits born from that. Energy IQ continues to grow in numbers with all the interactions we had in the last half equal to 71% of the full year from FY21. So we're really proud of that. You saw on the highlight slide that our brand MPS is up to 26, and the chart on the top right here shows the trend in that. And most pleasingly, that growth in brand MPS has been driven by a reduction in detractors and removing the reasons that customers choose not to stay with Genesis, which should be playing into a lower churn number, which you've seen. As we move forward, Energy IQ continues to play a really important role, and we will continue to focus on it. And I'll come to that in a couple of slides time. Next slide. So slide 18, we're giving you more data on LPG this time, a less visible market to many of the analysts in the sector who report a lot of electricity and not very much about gas and LPG. So we're showing you here for the first time the sector LPG growth. We've often said it's the fastest growing energy retail fuel in New Zealand, and it is. And also the dynamic of the wholesale production of LPG shrinking slightly as the demand in the market grows at retail has meant that more LPG is being imported. And you can see on the right hand side, bottom right hand side, 2021, 21.9% of the retail demand for LPG was imported LPG. why is that important because imported lpg is about twice the cost at wholesale of indigenous lpg production and therefore genesis's advantage as it was four or five years ago when we started to invest in lpg is our vertical integration to coupe where most of the lpg we need for our customers comes from so as lpg netbacks have grown that's one of the dynamics that's causing it and allowing us to be competitive and grow margins as we go residential numbers continue to be up and we're proud of the growth we're seeing there too Moving on to slide 19, the Energy IQ app is about to go through a big refresh. And by the end of March, customers will see a different Energy IQ. That shift from what we call Energy IQ 1.0 to Energy IQ 2.0 is to move the emphasis to be centered around the customer's home. So the image you see here on the top right is what customers will see when they open up their app. They'll be able to select a home image that most represents their home and their style and architecture of home. And if they have other home energy functionality like solar panels, LPG, EVs, then the image will demonstrate that as a real example of what's in their home. And the features that they start to see will start to reflect what matters to them to help them manage their home. So you can see that that shift is going to be quite meaningful. It's going to be even more engaging. And it's because of the growth in numbers of Energy IQ users that we've been able to get confident about that and to really transform what we think will be not only a market leading, but probably an industry leading app engagement going forward. On slide 19, we talk about the EV products that, sorry, slide 20. We talk about the EV products that are now in the app. If you're an EV customer at Genesis right now, you get about a half price discount between 9 PM and 7 AM in the morning. And what we've seen is about 40% of our EV customers have been engaging with that on a regular basis. And we've seen about a 7% shift in demand to the evening hours. I'm one of those customers. And I promise you, when you know you're going to pay half the price after 9 p.m., you start to put your dishwasher on, your pool pump and other things on at night that you can shift. And so it's been a great experiment in human behavior as well for us. We've captured lots of learnings around that. And we're now moving into another phase of our EV pilot where we're testing dynamic charging, where the customer can choose in their app when they want their car to be charged by. And we decide for them the most economical, cheapest, or lowest carbon period during the night to do it if it's overnight. And we give them that insight at the end of it as to what they've gained from a carbon emissions perspective or from a cost perspective for having had that choice made for them. So it's a control function, but it's also got a huge value for the consumer. It's just two examples of how we're continuing to engage customers in energy management, which is about giving them the choice that matters to them in their lifestyle and their home, or also their business. So in the bottom right-hand chart here, you can see the growth in energy services being sold with CNI. We said to our investors over time that we see that as a competitive advantage. The more services we can sell with energy, the more we can differentiate the energy product. And we're winning customers now from competitors or retaining them against competitors who are offering cheaper prices because we're offering a service around decarbonization or energy efficiency that companies want. And so that's a really important differentiator for us as we go forward. And this summarizes our energy management ambition collectively. So on slide 21, We're just showcasing Frank Energy. So if you haven't caught news of it, Frank relaunched a couple of weeks ago. It's the old energy online. It's got a new brand persona and it's creating waves in the market. And we're really excited about it. We're giving it enough oxygen to run on its own. But it's not just about the brand. It's not just about the key messages. It's also about digitizing the brand. and digitizing the experience. You can see the journey started long before we refreshed the brand to move more of the digital sales and to become digital. And we've got some tough targets there to hit and we hope we will hit them over the course of the next year or two. We obviously measure Frank versus the tier two competitors in terms of churn, which generally has higher churn than tier ones. And we think it's gonna do really well over the next couple of years and we're excited to see its growth. The third brand in our portfolio is Ecotricity, which we talked about a year ago. And Ecotricity was a company we invested in initially at 60%. As of today, we've become 70% owners. We manage it at arm's length, and the numbers from Ecotricity are not reflected in our consolidated numbers. They are in our accounts, but not in our operational numbers. We sit on their board, but ultimately we let them run the business on their own. They are a 100% renewable certified retailer. And whereas they started life very much in the residential space, which you can see by the light green parts of the bars here, selling to customers who wanted solar panels on their roof, maybe a battery in their garage or EV, they've got a high penetration of that. type of distributed energy technology in their portfolio. They've seen real success of late in converting large businesses, many of them in this Auckland and Wellington area, to their product because those large businesses can then claim they've got zero emissions in their scope to emissions. So a really important proposition. It's certified by a government body called TOITU and Ecotricity continue to push the boundaries and stretch stretch the definition of what 100% certified is. And they're going to continue to push it and continue to push it such that it becomes an even more robust measure. And they're really committed to that and making sure that where the wind is not blowing, there are offsets to make sure that it is definitely 100% renewable. So growth targets abound. And they've also been successful not only in large corporates, but also with some of the data centers recently that you've seen announced. with solar sleeving products as part of the package. So companies that want to put solar on their roof or want solar to be part of their mix. So really exciting proposition and we will stay close to them. So moving on from Ecotricity to slide 23, back to the generation portfolio. As Emma said, one of the features of the first half of this financial year was the flexibility in the portfolio. And if you saw our Q2 operational report, we covered it in that, and we want to reinforce the point here, which is that is the strength of Genesis's portfolio. We can run long and high prices with our thermal plant, and we can turn it off in low prices and buy off the market. And the chart on the top right-hand side here shows how we did that in December. It's not perfect in every day and every period, but in general, we were running short at low prices, reducing our weighted average cost of energy that we passed through the retail business. Another message coming from this slide is that the deal we did with Methanex last winter to buy a lot of gas, which was a lot of gas for Genesis to swallow, and we demonstrated it in our full year results for FY21 as how we absorbed that fuel into Huntly Power Station. What you see on this chart is that we swapped a lot of that gas to future periods. So we swapped it into the next winter, 2022, and also some of it into 2023. which means we've got a very full gas book going into the next two winters, which means Huntley's Unit 5 and Unit 6 will be at a run at maximum capacity. And that's put us in good stead for the next couple of years. Moving on to slide 24. As well as gas as a key fuel and coal as a key fuel, we look at carbon. And carbon, in the past, we've disclosed the top right chart, our carbon hedge position. But a new disclosure this morning for analysts and investors is the carbon hedge price. So we're not giving you the exact prices in a band, but the bottom right hand chart shows you our hedge position through to FY28 versus the spot price for carbon. we think this is really important because it's a competitive advantage but of course the market operates at spot prices and a lot of our contracts pass through the spot price but our cost base is based on the hedge price so that's really important on the bottom left hand side we're calling out the total storage capacity of genesis including coal we're heading into winter in a really good position as you would have seen in our quarterly report this coal stockpile is the highest it's been for a long long time And that coal was purchased before last winter on long-term contracts with shipping agreements, which means we're getting it at a price way below the spot price or the market price globally for the last six months. Many of you will want to know what that price is, but we can't tell you. We're not going to tell you. It's competitive information that we're just not willing to disclose at this point. So don't waste one of your questions later asking because we can't disclose it. Moving on to slide 24. So as we move forward, energy security continues to be an issue, obviously, and Coupé is playing an important role in that. We had a successful project with Beech to build the compressor, which started to come online end of September, early October in the half. And Coupé now has the capacity to produce 70, 70 days a day again, which is awesome. And you can see the long term gas production forecast on the bottom right hand side, which we often get asked. in meetings about, but we haven't necessarily shown so visibly before. And you can see the impact of compression on that. And there's work going on right now about a fourth well at Kupe. We expect to be through FID, if there is approval for it, around the middle of this year, maybe the third quarter. So that's exciting. And that will have a strong business case with it if we move ahead. Obviously, the crude oil price in the bottom left-hand corner here is way out of date since Russia decided to invade Ukraine. Moving on to slide 26. Keeping people safe is a key priority at Genesis, always has been, and no more so than in the last six months to 12 months as COVID has ramped up. We feel really well prepared for Omicron as best we can be. We have a COVID safe workplace plan in place. And we were one of the earliest companies to start testing our employees as they came to work. That started with saliva PCR testing at Huntly last August, and then migrated into not only PCR testing, but also rapid antigen testing at all our sites from around November. We have a good stock of supply and actually this slide is also slightly out of date because as we move to level three or phase three, we now have to test daily, even coming into our offices. But our offices have been open throughout the period, throughout the red phase. And as long as you test daily and you test negative, you can come into the offices. But we're still running PCR tests every Monday at the Huntley Power Station, as well as the saliva testing. So we've done a huge amount, 14,500 PCR tests and 15,500 rampant antigen. We've got a good bit of infrastructure set up around it. On the bottom right-hand corner, our injuries are trending up, which is a worrying sign. We've been tracking this for a while. The only silver lining is they're relatively low impact injuries, many of them in LPG, what we call slips, trips and falls. But we are concerned and we're keeping an eye on it. And it's a function of the role to some extent, the hard work that men and women of LPG are putting in to making sure bottles are delivered on time. And we're keeping a close eye on that trend up. Employee Net Promoter Score is still solid, slight dip in December, off a peak. But across Genesis today, we've got a very engaged workforce who feel protected by our COVID Safe Workplace Plan, who are doing their 50% to make sure they look after their peers as well. And we're going into this Omicron outbreak in good shape. moving on to a strategic outlook now looking forward now there's a number of slides in here that take quite a lot of absorbing so don't worry if it doesn't all make sense right away we'll have discussions as we roll around our roadshow on some of this um but moving on to the first one we we've um we've just reinforced here what our future strategy is now our vision in the wholesale segment of our business and the market is to be an active enabler of new zealand's energy transition and we've said that before but the word active is really important we're not going to sit back and just wait for things to happen you'll see genesis proactively engaging stakeholders in a number of different ways but proactively disrupting ourselves in some cases and making change happen the three pillars of growing renewables value from flexibility and reliability and transitioning hudley are all really important and we won't talk about it all today, but you will have seen things from us in the past and will continue to see things from us around those three pillars. And when we say transition Huntly, we often get asked, is Huntly going to shut down and will it ever shut down? And I just remind everyone, I think most people on this call will understand it is an incredibly important asset to New Zealand sitting in a really important geographical location right near the Waikato River with a gas pipeline from Taranaki with a coal mine nearby, next to the grid, with great grid connection, with a very well-trained workforce in the community and in the key demand centre of New Zealand. So we don't talk about whether Huntley is going to shut, we talk about what Huntley's future role could be and what the right role is for Huntley as we transition to a more renewable future. So with that, on slide 29, we're sharing with you today four scenarios for 2030 and 2025 that we've created recently and there's a couple of really interesting insights from this the first is while they all came from different places with different assumptions one a relatively balanced scenario of demand and supply another one when we have regulated um renew 100 renewable target one where demand is exceeding supply and supply can't keep up because of build delays, and the other one oversupply, they all coalesce to say by 2030, this market is going to be between 96 and 98% renewable. I think that's quite insightful. It's really positive in one sense, because there's not much that's going to stop that now. It's going to happen. Even in the pressure cooker scenario, we're going to get to 96% renewable by 2030. But it's also insightful because we need to start thinking about what we need to be true in order to have a reliable electricity system in 2030 when we're 96% to 98% renewable. So if you flick onto the next slide, 2030, the insight here, and it's not new, but we're calling it out really loudly, is when you look at a 98% renewable market, we're going to be spilling a lot more water. So the black line shows the percentage of renewability. The thermal generation obviously comes down, but the faint pink line shows the amount of spill in the lakes goes up. So our lakes will be higher more often, and they'll be spilling more often. The challenge of getting from 96 to 98% to 100 is that the more wind and solar we build, the more water we displace. And it makes it really hard or really expensive to get that last two or three or four percent of renewable out of the system or thermal out of the system. And the chart on the right shows what that means in a percentage of the year terms. But effectively, what it's saying is that in that zone of 98 percent renewable, we're going to need two things. We're still gonna have the risk of a dry year, which is when the lakes are low. We have limited storage in our lakes in New Zealand. They're not massive dams, and that risk will still exist. It won't exist as often, but it'll still exist. And then we're gonna need megawatts capacity to fill in the gap. when the wind doesn't blow, the sun doesn't shine and that cold windless night in winter comes along. So when we look at that, we say we need to start having the right conversations in New Zealand about how we solve those problems collectively across the industry, but also with government and regulators together. We flick on the slide 31. The good news is some of the insight we're gaining from our biomass work could solve one of those problems, which is the seasonal storage or dry year risk problem. It is not going to solve the peaking capacity problems. As we found out in August last year when there were outages, we cannot turn a Rankin on really quickly. And New Zealand is going to need some fast response peaking capacity, much more than it has today. Some of that will come from batteries, but possibly not all of it, because batteries are very short duration. But this biomass trial is starting to show us that actually it may be possible for biomass to play a role in the 2030s as a drier storage filler. The Rankins could run until 2040. They're in relatively good condition to many other plants like theirs around the world. And a number of reasons for that. One is they haven't been running baseload for very long. They used to run a lot on gas, which is much easier and less corrosive to the boiler and the burn. And if they were running on biomass, that would also be obviously less corrosive than coal. So they have a possible future, but the challenge is going to be the supply chain. We're going to be doing a trial burn in May now at Huntly, and we'll announce the date of that when we get nearer. But getting the torrified pellets, which you believe are the best pellets for the job, from the global supply chain is hard, but they definitely don't exist in New Zealand today. So we're going to have to have some discussions in collaboration with others and government on is it possible to create a viable biomass supply chain for the 2030s in New Zealand? If it becomes so, then it should be possible to provide drier cover through a ranking in the 2030s. There'll be more on this as we go through the next few months, and there's still much more work to come. Clicking on to slide 32, we actually have a slightly different take to some of our competitors on the regulatory environment. We think the risk is low. We think the opportunity, though, is high. Most of the reviews that have happened in New Zealand to date have not amounted to major interventions from the regulator or government. And I think there's too much made of the risk and not enough made of the opportunity. As we move forward through this year, it's a pivotal year. we're going to have emission reduction plans coming from the government in may we're going to have a budget that allocates capital to climate change initiatives and if we work together on the solutions i think we'll come up with some of the answers to make sure that electricity can play a really critical role in decarbonizing new zealand through the 2020s and into 2030s It is the moment for the electricity sector to step up. It's awesome to see all the great new builds coming online and we'll bring our own with solar in due course as well. But there's plenty of capacity for renewable electricity. We just need to make sure the market can operate in the environment I've just described and it can provide reliable, secure electricity to a decarbonized energy system into the 2030s. So moving on to the next slide. onto solar and our future gen strategy. We've made great progress contractually. We've got the YPP wind farm. We've had the first full half, as I said, of generation. We've signed contracts for Kaiwaikawa and Tauhara. And the chart on the bottom right, which is a repeat of one we showed in the full year last year, shows the trajectory of that as they come online. And the solar bills will follow quite quickly behind. I'm afraid I know there'll be lots of questions on it, but we can't give you locations. We can't give you pricing. We've got a pipeline and we're working on it and we will announce projects as and when they're certain. We're not going to be speculating on them because there's too much of confidentiality involved in it as we move forward. But we have moved forward with FRV, who are an awesome global leader in solar. We've signed contracts now, moved beyond term sheets, and they are working with us on the pipeline in New Zealand and there'll be announcements through this year. Moving on to slide 34, we are considering what further long-term carbon commitments we can make. We do have a science-based target to 2025, which I remind you is aligned to limiting climate change to one and a half degrees of global warming. We do have plans in place that will go beyond that, and you can see that in these charts here. The star is the target, the line is the forecast. Obviously, there's gonna be ups and downs with hydrology through years, but that's the forecast. What we're thinking through now is can Genesis make an even longer term commitment beyond 2025? It might be net zero, but the one commitment we're going to make, and we're making it here today, is we will not make those commitments unless we have strategies in place to achieve them. So what you won't see from Genesis is a 2050 net zero target with nothing behind it. So we're working on plans, we're working on strategies. When we have them, they won't be perfect and have solved every single problem. uh but they will be fundamentally clear in the direction we're heading and if we do we'll then make the commitment and that's what we've done today and that's what we'll continue to do going forward um but we're sharing these charts because we think for our investor set this is a really important direction to observe it's really important to see the downward trend and it's much more than a single point target it's a momentum that we're building in genesis across our scope one and our scope three emissions Moving on to slide 35, just briefly on retail, I've spent a lot of time on the wholesale strategy, but to remind you that our vision in retail is to be customer's first choice for energy management. That's been around now for about five years. The pillars underneath here are relatively recent in the last year or two, and we've talked through the operational update about some of the successes, so I won't go through them all, but our vision remains the same. It's to engage customers in a different way, way beyond the bill, to some of the choices they have in their hands when we give them the insight. So the next slide on 36 just talks briefly to the digital transformation piece of it, because we've mentioned this to our investors before, but it's well underway now. And we really have the three pillars of it, which is Mahi Tahi, which is about data, Rubix, which is about systems, and Bowie, which is about operating model. And as we work through these, we do expect to see a reduction in churn, cost to acquire and cost to serve over the next few years. But more importantly, this program sets Genesis's retail business up to be a formidably more innovative and fast-paced business in the next five to ten years than it has been over the last five to ten. So all the success to date, which you've seen come through the financials, have been through a lot of hard graft on existing infrastructure, but the teams are really excited now about what the new infrastructure and the new way of working is going to give us as we progress forward into the 2020s and 2030s. I won't go through it. We might go through in some of the meetings, but the use case example on the right just explains how we're looking at the operating model changes and how it affects customers, people who are working with customers, and obviously even our head office staff to some extent too. And that use case is just one of many we have in the business going forward. So moving on to the last slide before I hand over to Emma to talk about guidance, really proud that we could now announce the full executive team. This is a really diverse team, not just in gender, but in terms of experience, baseline, where people have come from, different markets they've worked in. and different career trajectories what i think i'd like you to take away from it is it demonstrates the depth of experience we have in genesis that we've had three internal promotions and that depth of experience extends beyond the exec and an awesome example of that actually has been emma over the last few months standing in a cfo and has hardly missed a beat the company has kept running really well the finance team has kept running really well and i think you as investors analysts have been served really well um so we have that depth of experience which is awesome James Spence is an external appointment who's coming in. We'll start tomorrow officially. He's coming in with experience of gen tailors in three different markets. He was CFO in Canada of Direct Energy, which is a Centrica subsidiary, CFO of one of the big three in Australia, Energy Australia. And then he was also CFO of ERM Power based in Brisbane before he became CFO of Gentrack. So he will bring different market experiences as well as depth of knowledge of our sector and obviously the finance disciplines. So across the board, really awesome team. Nigel Clark will step out around the middle of April as Rebecca steps in. And we're in a transition phase over the next six weeks until then. All right. So I think it's with that that I hand over to Emma to take you through guidance for FY22 and then we'll come back for Q&A.