Remgro Ltd Ord

Good day ladies and gentlemen and welcome to the Remgo results presentation for the six months ended 31 December 2022. All participants will be in listen only mode. There will be an opportunity to ask questions after the presentation. If you should need assistance during the call, please signal an operator by raising star then zero. Please note that this call is being recorded. I would now like to hand the conference over to Chief Executive Officer, Yanni Durant. Please go ahead, sir.

Good morning, everybody. Welcome to the result presentation of RemGrowth for the six-month end at 31st of December 2022. In the room, I've got my management board with me. They will help me answer the questions at the end of the presentation, and Neville Williams will do the biggest part of the results presentation when he announced the results. The agenda, the contents, I'll set the scene. I'll actually evaluate us on how we are delivering on our strategy that we've explained in the past. Then Neville will deal with the results for the interim period. Then I'll conclude by just looking ahead of how we see the future unfolding. Not that we will always be writing that. And right at the end, we'll give the audience the opportunity to raise questions. And we'll be able to answer some of those questions. If we look at... These graphs, normally when you see graphs going up, it's actually positive news, but in these instances, they're mostly not positive news on the global side. I mean, we're looking at, across the world, inflation, interest rates, uncertainty, except for the one on the GDP growth, but it's also a very constrained environment in 2022, and that's a backdrop to our results. Economic prospects were lowered at the beginning of 2022 with the Omicron virus, then we've got the lockdown still in China, the with crashing the property market in China, coupled that with, in Russia, the Ukraine war there, and the impact on that on inflation, the global supply shocks, and also the energy crisis. In Europe, actually handled it much better than everybody anticipated. Luckily, it was also of a mild winter that actually coincided with that, so that actually helped in that respect. But the IMF revised its growth forecast for 2022 and further also going forward. Inflation, big problem. It hits its peak level in the U.S. at 9.1% in June. The U.K. was 11.1% in October. And that is both for both countries, the 41% is a 41-year high. And the euro area was at 9.9% in September. I think yesterday the new latest U.K. numbers came out at 10.1%, so we're back into double-digit inflation. The newest demand from China because of the lockdown also heightened concerns over global growth factors going forward into equity markets in quarter three. The central bank hiking cycle continued throughout 2022. Monetary and fiscal policy looks to remain tight through 2023. As you probably saw yesterday, the Fed raised its interest rate by another 25 basis points. So this uncertainty and volatility dominate the sentiment across global markets during 2022. We are of opinion that interest rates will remain high for longer than we anticipate going forward, but the Fed is really between a rock and a hard place at the moment. Do they curb inflation or do they actually keep in, do they curb inflation of higher interest rate or do they keep interest rate at the current levels to actually helping the banking crisis? And I'm not sure exactly what's going to happen, but all I think that we think from our point of view is that these interest rates longer than we think. If we move on to the domestic side, I mean, similar picture on the graph. They're all going up, but it's not a positive sign on the interest rate cycle, commodities, energy availability. That's one thing that come into play in the domestic environment. And then food inflation, which is a real concern, not just for us, but I think for the country as well, and also that coupled with food security issues that we might get into the future if things remain the same. On the interest rate side, clearly the higher interest rate had a positive impact on the cash at the center, but also had a negative impact for us on our valuations. The high cost of debt and the higher risk-free rates equating to a higher discount rate overall had a negative impact on our high net accretion. And Neville will explain that in more detail later on. Humanities, you're all aware of the impact of high commodity prices in the food business. We have taken some significant price increases across our business, but these were not able enough to actually offset the margin pressure, and we couldn't fully recover the input cost. There was also a negative impact on total energies. Neville will explain it in detail because of the stock revaluation and the drop in the oil price of the negative mark to market on the stock valuations regarding total energies. Prices have started to come down, but not yet at acceptable levels from a margin point of view. I mean, maize still trades above 4,000 rand, but the yellow maize, I mean, this is still high. If you look at it from the east, it is very high. Food inflation, continued cost pressures, as we know, margin compression. We see that across the board, even among our competitors. February saw an increase in CPI. That is the effect of the added cost of power, and we'll talk a little bit about power later in the presentation, and we couldn't recover all of that through pricing. Energy availability remains a concern. Some of our companies are affected differently by load shedding. Some of them are in zones where they don't have load shedding, and unfortunately, some of them are in areas where there are load shedding. But we've established a collaboration network in the group that we try to mitigate some of these things. Now we can limit the impact on our companies to a large extent. But unfortunately, sometimes you can just do so much. One of the things that is becoming more of a concern for us is now with generators running, much longer hours than they used to or what they're actually designed for. So we're getting some generator breakdowns. And couple that with diesel stories at the start, that becomes also a problem to actually be able to store diesel at your sites, at hospitals, at factories and things like that. That also becomes a concern. Overall, if you looked at it, other factors that are contributing to unfavorable macroeconomic environment in South Africa also really affecting the investment case for South Africa from international point of view. It's a transit, the rail infrastructure issue, the inefficient rail and port operations, the cost to the economy in terms of export revenue. I mean, the supply chain is blocked. You see what's happening in the Cape Town Harbour, also at Richard Bay. I mean, the delays in exporting things and a large amount of fresh fruit actually is wasted and needs to be dumped. I mean, we've been graylisted the impact of that that has happened. And then clearly the effects of crime and corruption. Not just at the ESCOM level, but we see it across other industries as well, in the mining industry, the construction industry, and the logistic industry as well. And then the overburdened criminal justice system, NPA overburdened, not being able to actually swiftly and efficiently acting on some of the arrests that have been made. So it was a tough six months, and we don't really see things improving very rapidly in the next year or so, but I'll deal with that when I come to the outlook. Moving across then to the results, if we look at our results, we think our earnings momentum is maintained despite a lot of these headwinds that I've explained. Headline earnings per share is up by 5.7% to 626%. But it's not really comparable to the prior year. And the reason for that is, of course, of the corporate actions that has happened. For instance, the discovery equity accounting earnings by RMI plus MMH equity accounting earnings by RMI. And then elsewhere is the sale of Hastings. So there's quite a sale of Grinrod Shipping and also the unbundling of Grinrod Limited. That is it. that we can't really compare the current year's performance, the current six months' performance with the prior six months' performance, but Neville will explain that a little bit more in detail later in his presentation. We've increased the dividend by 60%, from 50 to 80 cents. As we said last year, the cash flow is lagging the earnings increase because of the dividends actually declared on the prior year earnings, so the cash flow is now starting to catch up with the earnings in that lag. The INAV is up by 5% to 223 rand from 213 rand, and I've explained earlier of the huge impact of why it's not higher because of the increase in the WAC rate. The closing share price at the end of December was 133 rand, which was up 2.4%, and the INAV discount is now over 42.6%. The increase in the earnings was mainly due to higher contribution from insurance, KTH, CIBH, which is now turning profitable, and Firth ran as well as higher interest income. It was partly offset by lower contributions from total energies, RCL food, and then as I've explained to some of the corporate actors like Green Ross, it's unbundling and so forth. Then if we get to our strategy, delivering on our strategy, just to recap what our strategic priorities is to unlock value, efficient capital allocation and to go under a sustainability drive. On the MediClinic side, if you look from the MediClinic side, from the turnaround there, it's a continuing journey. We're not there where we want to be. It's part of our corporate actions going forward. I can just say that we also, on the MediClinic side, There is certain structural issues that are actually plaguing us in Switzerland at the moment. There's a nursing shortage. The demand is there for ourselves, and sometimes we can't just do the supply side because of the nursing shortage. And CIV is also turning profitable. This continues to be a focus area for us, and we see pockets of growth there. Cash generation remains key for us to paying dividends. We are not yet back to pre-COVID event levels, but this is a function of a lag between earnings and cash at the centers I explained earlier. The recovery may also be slower than anticipated due to the macro pressures, as I also alluded to earlier in my presentation. We are also constantly reviewing how we can potentially supplement the different streams through other means, like share buybacks and so forth, and that's something that will be continuously evaluating going forward. Great strides have been made in reshaping the portfolio, and we are confident that we will be in a position to see the efforts of the corporate actions in the coming financial year. We continue to look at our assets in the three buckets, and when appropriate, we will look to dispose of some of the non-core assets, deploy the capital into our growth areas, and maintain our cash-generating assets as feeders of our dividend capacity and capital for growth. Once we have bettered down the ongoing corporate action and portfolio reshaping, we will be better placed to share with the market some of our thinking and plans around how we effectively deploy capital across the buckets and how we look at our balance sheet capacity, as well as factors that we will believe will contribute positively towards narrowing the current discount, things like sharebacks, et cetera, that we will be looking at. On the sustainability drive, ESG and sustainability remains a key focus. And we have made considerable progress in this period in embedding this into our strategy. We are committed to enhancing our sustainability strategy and approach to ESG, including to the development and application of consistency across the group as a whole. On the stakeholder engagement side, we are hugely aware that it's becoming much more important as our portfolio reshaping taking place towards a more unlisted balance. We have taken steps in ongoing and improving our disclosure and market engagement. This is for us to aim at achieving greater alignment with the market, especially relating to our unlisted investments. We have made a commitment to the market that our disclosure and our unlisted investments, as far as possible, would be as good, if not better, than even if they were in an unlisted space, to be able for our investor base to be able to do the relation, understand the unlisted assets perfectly. Next slide. If we're taking stock and we've given ourselves some marks, and if we didn't give ourselves some marks, we're actually in progress. But what we communicated to the market, what we said we will be doing, we think we are on a journey to get there. As you're all aware, we have made good progress in the past six months, as can be seen with the number of corporate actions executed on. I mean, we've sold Grinrod Shipping, unbundled Grinrod Limited, On the first-rate side, we've been through some corporate actions and some financial engineering around that, and I'll explain that a little bit later as well. We've unbundled the R&I group, and now we've got a direct stake in the out-surance group and direct stake into Discovery, as well as MMH. Under the Stellar 9, the concise, that deal has now really been approved, concluded. The ESL still says the CP is outstanding, like the election of Sherald if they want to elect cash or or shares, but we're confident that that will be resolved. Then there's the ongoing process of Mediclinic, the privatization of Mediclinic, as well as the Vodacom-CIVH merger on the fiber assets. The execution speed, unfortunately, is hampered by the lies in obtaining regulatory approvals, in particular from the South African authorities. It seems like all the other countries are way ahead of this from the South African perspective, and the one always lagging is the South African regulatory authorities. Our experience suggests there's an increased focus on promoting public interest to address some of our socio-economical challenges. Whilst we believe in the necessity of addressing these, we do believe there has to be a balance creating a level of unpredictability and uncertainty that can negatively impact the SA investment case. It takes a lot of our time to explain to some of our international partners why are these things necessary in South Africa and what it means for them. They don't sometimes understand a lot of these things, and it actually puts a lot of friction into the system. We are ever continuing to engage with the regulators with a spirit of commitment to seeing the successful implementation of these transactions, despite some of these challenges that we face. On the next slide, just to briefly talk a little bit about the energy platform that we are creating. This is really, I think, one of those things that we think is a must-do from our side as well. We've established a company called Ubigity that's been formed currently consisting of Energy Exchange and InnerWeb. R&B is actually a joint trend. There's a 25% shareholder in a shared strategic part in Ubigity. Energy Exchange does briefly on that. They've got their NIRSA trading license. The first power generation of their PPAs have been signed with Energy, expected to trade by June 2023. There's a current pipeline of more than 100 megawatts of supply and demand in process, which is expected to double there in 2024. And energy is exchanged involving market initiatives, such as the Cape Town Wheeling project. They're also dealing with other municipalities in other areas as well, and also having a good relationship with ESCOM on the Wheeling side. Enerweb, its H1 performance is tracking forecasts, and Enerweb is actually a provider of software tools for operators of power grids and trading platforms. Partnership with R&B, they bring different kinds of skills and a network of prospective independent power producers. They also bring value on risk management, financing, and structuring capabilities to accelerate the enablement of this platform. They also have a large corporate client base that may benefit from the energy exchange product offerings. We're also confident there's a lot of potential synergies between Energy Exchange and Interweb, and we've got the skill set to provide a unique offering to our customers, differentiating Energy Exchange from other traders. Complementary skill sets and capabilities between Interweb and Energy Exchange will provide the ingredients for a differentiated strategy from the market. Energy Exchange is a small business at the moment. It's an early-stage business, and we're taking a capital-light approach to it. But Fink is a business that can play a very important role in developing the private power space in South Africa. And just taking stock in allocating capital in line with the strategic priorities that we've done in the last six months. Just on the first round edges, during COVID, as you're all aware, we took out some edges over our first round stake, and during July 2022, We sold 19.2 first-rand shares for 959 million, just below 50 rand a share. And these were part of the 60 million first-rand shares with a series of options which became exercisable during June and July. The other 40.8 million first-rand shares were also sold during June 2022. Here in November 2022, Remgera entered into another aging transaction for 50 million first-round share. The reference price was R67.37, the two-year term. And they provide protection for us at 95% at a price of R64, with a call strike at R77.96, which is about 115%. Importantly enough, we've also contracted for the dividends, so we will have the dividends in there, as well as we will be allowed to vote these years at the first RAN annual general meeting by accreditation, although we did a script learning exercise. The narrow zero-cost dollar was valid at an asset of R118 million on the 31st of December 2022. After our interim period during March 2023, we've entered into a further hedging transaction on another 50 million first-range shares under similar terms as the previous one. The reference price in this instance was 67.02, providing protection at 95%, so that's 63.67, and there's a call strike at 114% of 76.40. The level for the pre-contracted dividends were increased from those set during November 2022. On the Asian partner side, we've invested a further $1 million into Asia Partners, thereby increasing our cumulative investment to $20 million in Fund 1. We've also made an initial investment of $8 million into Fund 2, which Remgra committed to invest up to a maximum of $50 million. We are limited 10% of the total fund size, which 10% stood at $37 million as of the 31st of December 2022. As at this 31st December 2022, the fair values of these rem gross investments in these funds in 2, Fund 1 and 2 amounted to $28 million and $8 million respectively. And the remaining commitments are $5 billion and $29 million respectively. On the milestone China funds, at the 31st of December, our total investment in Fund 3 is amounted to $101 million respectively. During the year under review, we received distributions of $4 million from milestone three, thereby increasing our cumulative distributions to $93 million. As at the year end or at the six-month end of the 31st of December 2022, the fair value in this fund amounted to $44 million. We also sold our investment in MCIH for a price of $7.3 million, which equates our initial investment into the company. On the PRIF side, during the year under review, Remgrove invested over R38 million into PRIF and received distributions of R6 million, thereby increasing our cumulative investment to R615 million. We've received also distributions of R353 million in this fund. As at the end of December, the fair value of our investment in PRF amounted to R716 million, and our remaining commitments amounted to R41 million. The performance of PRF have actually started to do quite well as they're freelancing investments and self-selling investments, so they're actually performing very well at this point in time. So that's finished my introduction. I'm going to hand over to Neville now for the results for the interim period.

Thank you, Yanni, and good morning, everyone. This slide just presents a graphic representation of how we have progressed since the onset of COVID in that second half of the financial year in June 2020. And then from December 2020 till December 2021, we were on a recovery path. And if you look at the six months to December 2021, we actually surpassed the pre-COVID levels. And then since then, if you look at the year, the current period of 3.5 billion headline earnings, That represents a 5.5% increase on an average per share. It's 5.7. And the difference is the positive impact of the shares that we repurchased during the interim period to hedge our commitment on the share scheme. So full recovery since 31st December 2021. That 5.5% increase is actually a muted increase, and as Jannie alluded to, the results of this period are not directly comparable to the prior period due to the impact of the various corporate actions. If you exclude that impact of the corporate actions in this year and the prior year's earnings, the rest of the portfolio actually increased by approximately 30%. So if you look at the next slide, just to put the results in context, on the right-hand side, you see the impact of the corporate actions, the ground road shipping that was disposed of in January 22. So we only equity accounted earnings for that six months to December 2021. no earnings in this period. We've unbundled Grendelot in September, October 22. Only three months earnings was equity accounted in this period, while the full six months was counted for in the previous financial period. And then on an outsurance RMI level, the outsurance unbundled Undo Discovery and Momentum Metropolitan. So these shares are now part of the Rengro portfolio, and they've also sold the hostings. So the equity accounted earnings from these three investments last year amounted to R351 million on a Rengro level. In this period, we've only received and accounted for dividends from Momentum Metropolitan. As you all know, Discovery has suspended their interim dividend. So the total net impact over the two years is a negative of 636. So if you exclude that 636, the rest of the portfolio actually did very well. And the major contributors to the increase of approximately 30%, excluding the impact of corporate actions. Outsurance group increased by more than 100%, so that's the main contributor to the increase, 242 million. Finance income, last year, the repo rate increased by 325 pips, and that has had a positive effect on William Grove's interest income, increased by 216 million from period to period. CIVH continued improved performances by DFA and WOMATEL, and they also turned positive on a CAVH level. So their headlight earnings contribution increased by 207 million, which is more than 100% increase. First Rand, we account now for dividend income and included in that increase of 185 million is the special dividend that First Rand declared last year. Our portion was 154 million rand. And then the earnings contributions from KTH and total energies actually created volatility in our equity account at the headline earnings. In that increase of 303 is, at the KTH level, a once-off gain of 521. On the rainbow level, it's 227. relating to the Actom exit process. It's after the sale of Actom and the partial repayment of the debt, the outstanding debt was actually forgiven and that's the gain, it's a once-off gain. And then at Total Energies, The crude oil price actually dropped from June 22 to December by more than 20%, I think it's around 25%. And that had a negative effect on the stock revaluations. The swing was around 400 and formerly a negative from period to period. So that's created volatility. But if you look at the portfolio, at the rest of the portfolio, excluding the corporate actions, these are the main drivers of the increase in headline ratings. Then this is just the internal segmental reporting dashboard that we present to the board. It's like a one-page commentary on the movements from the significant investments from period to period. And then detailed commentary is included in the board agenda when we present this to the board. I'll unpack the individual investments and the increases or decreases contributions to headline earnings in the next slides. And then the next one is the INAF also. This is also an internal segmental INAF dashboard. The intrinsic net asset value, as Yanni said, increased by 5%, while the share price increased by 2.4% from June to December. So the discount has widened to 40.6%. Just quickly on the makeup of this INAF, the listed investments are disclosed at market value or at the closing share prices at 31st December. The unlisted are disclosed at director's valuation. And I think the unlisted investment governance process is now very set. If you look quickly at the process, the corporate finance team calculate the internal individual valuations of the unlisted investments. They present that to the valuation committee of Rengro. Valuation committee interrogate the assumptions and consider that for recommendation to the audit and risk committee. Then the audit and risk committee consider that and recommend that to the board for final final approval. The June valuations are audited by PWC. December valuations are not audited, but we are very consistent in methodology from period to period. And that's important. Where we deviate from any methodologies from period to period, we disclose that and explain that to as well as the board. If you look at the WACC, the risk-free rate in the WACC calculation, we use, it's based on the annualized R213, and that rate has actually decreased by approximately 28 pips from June to December. The big impact is the increase in interest rates, the dry bar in that six-month period. has increased by 225 pips, and that had a negative effect on the valuations from June to December. What we also saw later in the presentation, an updated INAV based on listed prices on the 20th of March, 2023. And for the unlisted, because of volatilities in the geopolitical and economic space globally and in South Africa, we have applied a downward adjustment of 5% to the unlisted investments cash flow forecast that was used as a basis for the DC evaluation to December. But I'll explain that later when we present the updated INAF. So if you look at the top five investments actually contribute just under 63% to our portfolio, where the top 10 up to cold energies contribute approximately 83% of of the INF of Remgrove. Then this is just the split contribution in headline earnings as well as INF per platform. So the segments of Remgrove are the significant investment investing companies. And then we then organize that into platforms. And you'll see the major platforms are the healthcare. That's your MediClinic investment. The consumer products consist of Distil, RCL, and Cicalo. Financial services will be Upsurance and Business Partners. And then you also see the portfolio investments, their contribution to INF and Headline Handings. It's also significant, and these portfolio investments now consist of our interest in FirstRent, Discovery, Momentum, Metropolitan, as well as Patent and Relate. So moving on to the individual investments, the health care, their earnings contribution increased by 27%, but if you look at their adjusted earnings, because they disclose adjusted earnings to assess the actual financial and operational performance, as well as a method to provide investments a better understanding of their financial performance. That actually decreased by 15%. And if you look at the adjusted EBITDA, decreased by 1%. The EBITDA margin is also a bit under pressure. from 15.8 to 14.2. And if you look at the next slide, this is a slide that Mediclinic actually present to the investment community, the segmental adjusted EBITDA and the contributions of the Middle East, South Africa, as well as Switzerland to their adjusted EBITDA. And you'll see that the Middle East adjusted EBITDA margin actually decreased to 11.4 because of investment for growth in new existing facilities, more staff cost, as well as pronounced seasonality. If you look at Switzerland, South Africa actually is stable from period to period. Switzerland's EBITDA declined by 12%, and mostly because of revenue decline and COVID-19 staff absenteeism, as well as nurse shortages that Yanni has alluded to. If you look at the consumer products platform, as I said, consisting of Distil, RCL Foods, and Cicalum, Distil and RCL Foods are listed, are unlisted. So their contribution to headline earnings, 28%, and to INF, just under 22%. Moving on to the individual investments, Distel has announced their results. This is just a snapshot of their results. Double-digit revenue growth of 15.9%. on the back of a 10.3% increase in sales volumes, mostly driven by Silas and RTDs. I think Savannah is the big brand there. And then the double-digit growth relates actually to a moderate profitability gains because of the significant input cost increase And that was largely driven by imported glass as well as apple juice concentrate. Increasing costs there. Electricity disruption also created higher costs as well as stock building in the business. So there's just the more detail on the contribution per region. South Africa dominates on a revenue and volume level and then the contribution per category where Ciders actually dominate from a volume perspective. And on RCL Foods, they also announced their results. This is a snapshot. Revenue actually increased by more than 17%. But if you look at the significant increase in the cost structure, the underlying EBITDA decreased by 9.2%. and mostly because of the overall performance was mainly impacted by lower contributions from Rainbow, the chicken business, and the baking business unit. So Rainbow's turnaround was hampered by this high commodity input cost, poor agricultural performance, operations. The baking business experienced slowdown in demand post the implementation of price increases to counter high wheat prices, so their commodity prices and cost structure also increased significantly. And there's your segmental revenue contribution. If you look at the major contributor to revenue is actually your chicken business but a negative contribution to operating profit because of all the issues in the rainbow currently. So if you look at Sukala Foods, the unlisted investments, revenue increased by 12%, while the operating EBITDA actually decreased by 2%. And that just shows the challenging trading environment that Chicago experienced over the past six months. Continued cost pressure, 21% increase in the material cost on the cost side. They actually applied a further 4.5% increase in October, but the full impact of that cost, increasing cost prices, they were unable to pass on to the already cash-strapped consumer. The consumer is struggling at the moment, and you can see that in the 2.1% volume decrease because of the consumer spend that's been negatively impacted by rising inflation and interest rates. If you look at the valuation drivers, the Chicago's valuation increased by 4.7% to 6.6 billion. And the main drivers of that increase was a decrease in the WAC rate that had a positive effect on the valuation. In the forecast, the five-year cash flow forecast, they actually forecast single-digit revenue growth. It's less than 5%, especially from a volume and price perspective, and also forecast margin recovery in gross profit and EBITDA over the forecast period actually normalized to sort of pre-COVID levels. Financial services consist of out-surance, and there you'll see we've split the out-surance group into continuing and discontinued. The continuing operations consist of out-surance holdings, and then at group level, there's certain other investments there. but actually Outsurance Holdings Limited contribute a major portion now of Outsurance Group. Their continuing headline earnings increased by 147.6%. On a normalized basis, they announced the results yesterday, the headline earnings increased by 78% due to a 45% increase in the earnings of Outsurance Holdings Limited, the insurance business, and The reason for that increase is a significant improvement in the earnings of Yowie, the Australian subsidiary, from period to period, as well as lower funding costs at group level, because they've utilised the proceeds of the Hastings disposal to actually settle their debt at group level. From business partners, also a significant increase of 46%, interest income, as well as they've now starting to release credit impairments that they provided for during the COVID period, as well as the positive impact of cost containment measures are also now filtered through their earnings. If you look at the The valuation of business partners increased by just under 2%. In this instance, we use their net asset value. Of course, 95% or more than 95% of their assets are fairly, are fair valued in the balance sheet. And then we apply a tradability discount due to the no liquidity in the share. Then infrastructure, the main investment here is CAVH. So if you look at CAVH, their earnings, their revenue top line increased by 14% operating earnings by 69% and the headline earnings that we account for actually increase turn from a loss to a profit. So there you'll see the impact of operational and financial gearing and the scaling of the business. So the improved performance of the fiber business is due to the continued network expansion over the last few years. If you look at the intrinsic value, decrease of 1.6% since 30th of June. And the main drivers is the increase in the WAC rate by 28 BIPs because of the increase in cost of debt. The DCF valuation methodology is based on the combined fiber business 10-year forecast. signed off by the CAVH board. And if you look quickly in the revenue growth forecast, it's mostly driven by the increase in FTTH uptake and fiber to the business expansion. EBITDA growth forecast is a function of the increase in revenue and the scaling of the business. And then the CAPEX assumption in that 10-year period is mostly on the fiber to the home roll-up. So we also apply a tradeability as well as a forecast risk discount to that DCF valuation. In the next slide are the results, top-line results of Bumatel and DFA. So Bumatel, you'll see a 14.2% increase in revenue 16% in operating earnings and 47% in headline earnings. If you look at DFA, 10.5% in revenue, but the operating earnings and headline earnings actually more than doubled from period to period. And this is just the positive growth momentum that you now see in operating earnings and headline earnings going forward. So this is just a slide on certain of the key indicators regarding the fibre infrastructure platform. I'm not going to delve in detail into this. Then on the industrial, this is our industrial portfolio. Air Products, Total Energies and Waspeco are the three main investing companies there. You'll see on the left-hand side the evolution of the headline earnings over the three interim periods. And the blue line is actually the headline earnings accounted for from total energies. And there you'll see the volatility of the stock revaluations, positive and for this period negative. If you exclude that, you'll see the headline earnings excluding the stock evaluations, and that's the dotted line. And if you look at the 170 to 129, there is a reason for that, and I'll explain that. Just quickly on the INAV, valuation drivers, air products, the WAC increased by 11 bps due to the increase in the cost of debt, and the increase in value is actually driven by continued stable revenue growth. There's a bit of cost pressure in the operations, and that resulted in a margin squeeze in the forecast period. But the on-site business is the major contributor to the revenue pivot, and they operate mainly on long-term, fixed-term contracts with a solid cash and revenue path. The coal energies, their WAC, the valuation increased by 2.4%. Main reason is the decrease in the WAC by 21 bps, which had a positive effect on the valuation. At the moment, current volumes are under pressure due to fuel prices still at elevated levels. Waspecu, a slight decrease in the valuation because of an increase in the WAC rate. In the forecast, very conservative, low single-digit revenue growth, forecast due to a subdued market demand for aluminum extrusion at the moment. Then on the next slide, more detail on the top line, the revenue and operating performance of the different unlisted industrial companies. Just quickly on air products. very positive improvement in revenue as well as operating performance. The demand for cylinders and other packaged gases was relatively strong, but they also now start to feel the cost pressures in the system. Total energies, if you exclude the negative stock effects, their earnings decrease by 24%. And this decrease is mainly due to higher input costs, heavily impacted by supply challenges, experience in the importation of fuel products. So the Ukraine-Russian war still has an impact on the availability of crude and finished products. And that was partly offset by higher margins from NADREF. Waspeco also very positive, double-digit increases in revenue as well as operating profit. Diversified investment vehicles consist of KTH and then the funds of which present China Equity Fund is the most significant, and then the in-benefit portfolio. You look at KTH, there you will see the headline earnings contribution. And I've discussed that the ones of debt forgiveness gain of 521 actually resulted in 673% increase. It's INAV increased by 5.7, or the valuation, and the drivers are the official media, momentum, metropolitan, and service. These three investments contribute 93% of their INAV. Then just quickly, other investments, treasury and corporate costs. E-media has already announced the results, a decrease of around 10%. VSD portfolio investments, the evaluation actually decreased by 4.2, and they consist of first-line discovery and momentum. Then the other social impact, central treasury and other net corporate costs decreased. make up the total intrinsic value of 23.6 billion rand. Just an update on the intrinsic net asset value. So since December, the INF increased by 4.5%, mostly driven by an 8% increase in the listed portfolio. And also, as I said, we've applied a 5% haircut for a downward adjustment to the unlisted. So if you look at the discount increase to 44.5. The debt and cash at the centre, cash increased by 1.7 billion to just under 14 billion at 31st December. We have debt of 7.9 billion. So the net cash is approximately 6 billion at the centre. You can remember that we have a commitment to increase our stake in MediClinic to 50% at 5.4. It's a 200 million pound commitment. So we have sufficient cash to finance that. This is a cash flow bridge. The big driver of the increase in the cash movement is the dividends that we received. 1.7 billion and we've also sold 19.2 million first rate shares. This is just the movement in the cash dividends over the periods since COVID. The COVID period of 720 million, that's the low base and from that low base we've recovered to or we're approaching full recovery. with that 1.7 billion. This is just a detailed slide of the individual investments contribution to dividends. And then, as Yanni said, the board, looking at the recovery in cash and dividends received, has declared an 80 cents interim dividend, and that represents a 60% increase from the previous year. And that's still from a low base. So the 60% increase in interim. And Janne, that's my part of the presentation.