EMCHF (EMCHF) Q4 2026 Earnings Report, Transcript and Summary

Thank you for standing by, and welcome to EML Payments Limited Full Year 2026 Results Briefing. [Operator Instructions] I would now like to hand the conference over to Mr. Anthony Hynes, Executive Chairman. Please go ahead.

Thank you, moderator, and good morning, everyone. Welcome to the EML Payments Limited FY '26 Results Telecall. As stated, I'm Anthony Hynes, Executive Chairman. It's great to be here with Stuart Will, our CFO, to report our results for FY '26 and provide an update on EML 2.0 progress. Following our presentation, we'll open the call to questions. I'll refer you first to the ASX announcements, which were issued by EML Payments Limited this morning, which formed the basis for this call. If we can move to Slide 4, please, moderator. It's been an incredibly busy and important 12 months of EML as we passed the halfway point of EML 2.0, the transformation strategy we presented to shareholders and the investment community in November 2024. As always, I'm going to be upfront with you all. Our financial performance this year didn't meet our expectations. There are a bunch of reasons, but thematically, onboarding of new customers and net new revenues was slower than we could have anticipated, and we had softer trading in parts of Northern Hemisphere in the second half. I'll unpack those drivers shortly. That said, let me be equally clear on this point. EML is a much stronger business today than it was a year ago, and that is down to the dedication and execution of our team. The sheer volume of things and the size of some things that we've had to deal with, including the ones I believe nobody could have seen coming, should not be underestimated. This group of people has shown and continues to show our resilience and determination that I haven't seen before and it underpins my absolute confidence in EML's future. Combine that with new product and technology capability we're enabling, and I'm excited about EML and where we're headed, including on the path of meaningful free cash flow in the not-too-distant future. Let me touch on the key themes of the year. On operations, our restructuring program is largely completed by 30 June. Frankly, it's annoying that many of the masters of design of these issues have all been able to move on while we clean up. It's been a significant undertaking, let me tell you. It's also pleasing to be able to tell you that 51 senior positions were refreshed during the year, and we are better led and more effective as a result. Our global operations center reached 31 full-time employees by year-end, delivering a 35% like-for-like savings and implementation of our new CX platform is underway. This will unify service management globally and power self-service, which is a great leap forward for our people and our customers. On the commercial front, our pipeline is strong and winds are flowing. It's been fantastic to see the revolution in our relationship with regulators, partners and customers alike. Implementation time lines, however, have caused some frustration. And unfortunately, they've had impact on revenue pull-through. While some contract opportunities have been resized, there are a number of program activations that have been delayed due to client factors such as resourcing and readiness. Most notably, however, we continue to experience as to other market participants, activation challenges with a key payment infrastructure partner in Australia. We've talked about this for a little while now. This impact is growing. These are topics we've discussed over the last 6 months and something we need to unlock. But rest assured, we're taking every step to do so. The encouraging story is that our key clients continue to renew courtesy a better operational performance and vastly more effective relationship management, including some of my team being involved in those relationships. On product development, it's now embedded across the group under new executive leadership. Our mobility solution is advancing at pace alongside our technology partner tendering, and our BAU product development is now active. As an example, our APAC team launched an end of year -- end of FBT year, benefit maximizer card. It's approximately 16,000 salary pack cardholders, almost $3 million in PAYG tax. A great result first half for something we hope becomes an automatic process across all of our salary pack programs moving forward. And financially, a mixed result. EBITDA didn't reach target because of the delayed activation of new contracts and softer trading in the second half, partially offset by good control of our overheads. I've got to tell you, I don't want to in number, and I'm sure you don't either. But I don't want you to underestimate the cost control. It's been a very heavy lift beyond our thinking, as I've indicated, and to do some of this overhead envelope is remarkable. In short, the restructuring is largely done. A stronger EML is emerging and our commercial momentum is becoming infectious. We move to Slide 5, please. Financial performance for the year was in line with our revised guidance. Stuart will take you through the details shortly, but at a headline level for continuing operations. Revenue was $26.8 million, down 6% on FY '25 with customer revenue of $150 million, down 4%. That decline was expected nonrecurrence of previously excited customers and foreign exchange movements. Excluding these, the portfolio actually grew by 3.8%. Interest revenue declined 11% to $56.7 million as central bank rates reduced across all regions, with our bond program partially tempering the impact. We think FY '26 represents the bottom of the cycle for the foreseeable future. Underlying EBITDA was $48.3 million, and within our revised guidance range and overheads were well managed at $104.1 million, down 3% on the prior year. Our statutory result improved materially with a net loss after tax from continuing operations of $19.7 million compared to a loss of $53 million in the year prior. Cash at year-end was $37.8 million, down $21.6 million over the year. This reflects outflows for legacy matters. And yes, I'm as sick of these as you all are, including the class action settlement, repayments to the PCSIL Liquidator and investments in Project Arlo and Tendren, our mobility technology and go-to-market partner. Importantly, these outflows are largely nonrecurring and the conclusion underpins the free cash flow trajectory I'll come back to in the outlook. We can move to Slide 6, please, moderator. Moving to EML 2.0 and our progress. I want to walk you through each pillar. Starting with our global operating model and strengthening leadership. We've significantly strengthened the leadership across all of our markets. Our global HRIS platform has been deployed, replacing 5 separate systems and a single global performance management framework is embedded, aligning individual accountability with our strategic objectives. And as I mentioned, our global operations center in Sofia is realizing a 35% cost saving with 31 FTE now in place. This sort of thing really ought to be BAU, but the state that we found this company in versus where it is at today is akin to comparing our Fort Myer in success. Moving to the revised revenue engine. The pipeline continues to build, $109 million at report date with pleasing conversion rates. Top 30 renewals are continuing with 9 extensions during the year. We strengthened our commercial and product leadership with new regional heads appointed in Europe and APAC late in the second half. Local leadership, particularly in commercial remains a critical performance enabler. And while we didn't get this right at the start of last year, we have now and it's reflecting in our new business performance. And the final pillar, our single platform, AKA Project Arlo. Arlo is advancing at pace through the build phase and initial pilot has been deployed in the U.K. with testing underway, including client testing. Our migration planning team is established and indeed planning with U.K. migration to commence in FY '27. I'll say more about Arlo in the outlook. We move to Slide 7, please, moderator. Let me now give you a more granular view of the business development, which I know is front of mind for many of our shareholders. And new program pipeline stands at $109 million, as I said, of annualized revenue at report date, $69.6 million in North America, $23.5 million in Europe and $16 million in Australia. Approximately $50 million of that pipeline, and this is important, is in client tender or final decision phases. Turning to contract flow. Since 1 July 2025, we've won contracts with an annualized revenue forecast of $15.8 million. Of that, $7.2 million has launched and is already generating revenue and a further $8.5 million is to launch was $6.3 million or 74% of it due to launch within 60 days. A portion of this will be realized this financial year based on start dates and ramp dynamics. So what's working? Pipeline build remains on track. Our FY '26 conversion with 35% is strong. Margins are holding and our digital programs have been reenergized, mainly in North America. Digital program revenue is probably the most difficult thing down, and we've had a number of opportunities that will be softer than first quarter FY '27, but ultimately, bigger revenue opportunities over the 3-year cycle by a number of factors. And what's not working, signed to revenue timing. It's a mixture of partner and client dependencies as I flagged, but enhancement work is well underway. Europe was lagging, but we've appointed a new regional commercial leader, who is joining shortly. And we've recalibrated the opportunity size for several accounts, contracts we believe will over time move at least available as originally anticipated. We move to Slide 8, please. This slide speaks to our existing client base or giving more from the core. Our renewal performance continues to be strong, 9 of our top 30 contracts were renewed in the last 12 months, including 3 of our top 5. This is a testament to improved operational performance and a step change in our relationship management. Product innovation is now front and center with many of our key clients, which we see as a leading indicator of the quality of these partnerships. I'll touch on our salary pack benefit maximizer in the opening. We're also very active with merchant reward and discount solutions as an additional benefit for programs in Australia. And this area for global rollout. On trading, the second half was softer in the Northern Hemisphere across our gift and incentive programs and some U.K. government moves. Existing client customer revenue, excluding interest and previously reported terminations, was down 4% half-on-half. Concentration remains well managed. Our top client represents around 8% of revenue, our top 5 around 23% and our top 30 around 47%. Moving to Slide 9, please. Turning to Mobility, our first strategic product initiative and we build at 1 in. We're building a digital-first global mobility solution that replaces legacy fuel cards with a state-of-the-art open loop offering. No more plastic cards, and no more fleet fuel cards in your car even when it's an EV and with 3.5% surcharging. This is a large and growing market, global mobility payment volumes represented around $1 trillion in 2023, and is forecast to reach $2.1 trillion by 2033, an 11% compounded annual growth rate. It's a hot space and EML is active, not just in Australia but globally and with the rates. We've partnered with Tendren, a digital-first enterprise mobility tech group to revolutionize this market. The solution combines what each partner does best. EML brings program management, issuing the processing across both an open loop, regulatory and payment rail licensing, ledger and funds management and a large existing client base. Our partner, Tendren brings global fuel retailer integrations, enterprise solutions for own brand programs, control and configuration capability and deep domain expertise, together with a new business pipeline through its go-to-market. Reflecting the strategic importance of this capability, EML made a $7 million equity investment in Tendren during the second half, representing a 28% interest, which may drive over time as the solution market develops. With that investment comes joint go-to-market and development of market-leading functionality. Platform build is well underway and launched client engagement is advancing the plan. We will use FY '27 to test the platform ahead of a full commercial launch towards the end of the year. Beyond mobility, we see large scale product opportunities across several verticals, which speaks both to the positive market dynamics and EML's capabilities to engage at this level. Can we move to Slide 10, please, moderator. As Arlo moved into the second phase of core build, vendor integration and readiness planning, new executive and project leadership was injected. Arlo is now deployed for testing in the U.K. region and will be underway with migration in the second half. We expect Australia deployment mid next calendar year and a similar process of initial testing ramping up to new client onboarding and migration of existing customers. As I've said before, we're taking a measured and staged approach to migration to avoid disruption, both internally and for our clients. Based on an updated view of migration time and the core functionality we want to build in, which now includes mobility and bringing a number of external vendor capabilities in-house, the time line extends and look at the investment profile. Between the core build and operational implementation, we forecast nonrecurring expenditure of approximately $15.7 million this financial year, $2.4 million next year and $1 million the year after. Importantly, our updated planning re not less than $12 million of annualized overhead savings on full Arlo deployment. The payback is near to medium term. In summary, we've accomplished a lot in 12 months, but have a lot to get through in FY '27 with a big focus on commercial performance and Arlo as I've mentioned. But we're encouraged by green shoots and the opportunities ahead of us. I'll now hand over to Stuart to take you through the financial details.

Thank you, Anthony. I'll start with Slide 12. Beginning with the group's key operating metrics. FY '26 was a challenging year from an earnings perspective, with underlying EBITDA declining 18% to $48.3 million. Revenue was impacted by 3 headwinds, the nonrecurrence of $10.8 million of FY '25 customer revenue for programs previously terminated but in runoff mode, which have been communicated to the market previously. Foreign exchange movements and lower interest revenue following reductions in global cash rates. As Anthony noted, our expectation is that FY '26 was bottoming out of the yield curve for the medium-term cycle. Our European business also held the impact of softer trading across 2 large customers in the second half of FY '26. Trading with these customers stabilized and is expected to remain at current levels into FY '27. Excluding these factors, underlying performance remained broadly resilient, underpinned by strong cost discipline. On a reported basis, customer revenue declined 1%, driven by Europe and North America, partially offset by growth in Australia. Excluding the headwinds noted earlier, the portfolio was up 3.8%. Moving to interest revenue. We saw an 11% decline, reflecting lower central bank rates across all regions. Our bond portfolio continued to perform as expected, and we plan to make wider use of bond instruments to drive interest yield over the coming year. Net overheads decreased by $3.5 million as efficiencies were realized in both internal and external resourcing, while investment continued in commercial capability and the go-to-market team. Cash decreased by $21.6 million from June 2025 without plans relating to the class action settlement, repayments of PCSIL liquidator, the Project Arlo build, investment in Tendren and restructuring payments. These outflows were funded through operating cash flow and a drawdown of debt more on that later. Moving to Slide 13. We show the financial performance of Europe. Europe remains our largest segment with just under 500 customers across the U.K. and the broader European room, operating across government, financial services and human capital management. Europe revenue was down 14% on FY '25, reflecting the nonrecurrence of certain customer programs and lower interest revenue. Customer revenue itself declined 16% to $65.4 million. This reflected $9.7 million nonrecurring FY '25 revenue from exiting customers and a $3.2 million impact from the trading across 2 large customers, which were down 21% versus the prior corresponding period. Trading has stabilized in Q4 and is expected to improve over FY '27. Against those headwinds, key existing customers, which comprise 55% of FY '26 revenue 7% underlying growth, demonstrating the strength of the portfolio. Interest revenue declined 11% as falling and rates were partly tempered by a shift towards high-yielding bonds. Net overheads reduced 10% in the region following the group's transition to a more centralized operating model. And overall, underlying EBITDA for Europe was $35.7 million, down 22% on FY '25. Gross profit was in line with the prior year, while EBITDA margin was impacted by the revenue pressures. Moving to Slide 14. We show the performance of the Asia Pacific segment. This comprises our Australia and New Zealand business, which are predominantly general purpose reloadable products with a strong human capital management presence and just under 200 customers overall. Total revenue was up 8% in FY '26 to $56.5 million. Customer revenue increased 14% to $47.6 million with the human capital management vertical leading the growth. Salary packaging active benefit accounts were up 4% on FY '25. And this is a strong developing vertical for EML, and we are pleased to have secured several key client renewals over the last 12 months, which creates a great runway for the team to advance our innovation agenda with this growth-orientated client group in FY '27 and beyond. Interest revenue was down 14%, reflecting resilient rate reductions through FY '26. The Net overheads increased in Asia Pacific as part of the group's transition to a more centralized operating model. Overall, group costs reduced. So the increases in Australia reflect the balancing of the operating model rather than an increase in the group's overall cost to us. Underlying gross profit increased 5% to $35.9 million, while underlying EBITDA declined 19% to $10.4 million. Gross profit margins were in line with the prior corresponding period, while EBITDA margin was impacted by the uptick in overheads. Moving to Slide 15, we show the performance of the North American segment. North America operates predominantly in retail gift and incentive products with participation in financial services via the banking product and some exposure to Gaming. The segment is just under 500 customers. Customer revenue declined 2% to $37.1 million, and this was driven by a $1.6 million foreign exchange impact when using FY '25 rates, and a $1.2 million impact of nonrecurring FY '25 revenue from exited customers, partially offset by solid growth from the remaining portfolio. Consistent with other regions, North America experienced lower interest revenue as cash rates declined. Underlying gross profit increased 1% to $28.6 million, and net overheads fell 12% following the group's transition to a more centralized operating model and the underlying EBITDA rose 74% to $7.1 billion. Moving to Slide 16, which provides further detail on the group's overheads. Underlying overheads were $104.1 million, $3.4 million lower than the prior corresponding period. This reflects cost optimization measures and benefits from EML 2.0 efficiencies continuing to be realized. Cost savings were delivered across employee entitlements and professional fees, partly offset by investment in ICT and higher recoverable VAT and GST charges. Employee entitlements were $3.7 million lower than the prior period, reflecting operational efficiencies and lower short-term incentive costs. As shareholders would expect, there is a clear link between performance achieved and incentives paid. These costs are expected to normalize in FY '27 to around $110 million, consistent with previous guidance. Technology cost increases reflect targeted investment in the current platforms and the broader new global operating model. All other costs remain broadly in line with the prior year. Project Arlo costs expensed in FY '26 were $4.2 million relating to the build, and these were excluded for net overheads and underlying EBITDA consistent with previous guidance. Moving to Slide 17. We show the group's treasury management position and interest income performance. Stored float was $2.2 billion at 30 June 2026, and by currency, the largest exposures for GBP at 46%, followed by the AUD at 24% and euro 21%. Interest revenue decreased 11% to $56.7 million. This reflects, as previously mentioned lower cash rates and a 6% reduction in float balances with Europe accounting for the majority of the decline as a result of its trading headwinds. Of the total stored float, $1.5 billion was held in cash and $0.7 billion in bonds. The bond portfolio contributed 52% of total interest revenue or $29.4 million with an average term of 2.5 years at an average year 4%. The annualized yield in FY '26 was approximately 3.2% compared with 3.6% in FY '25, with an exit yield of approximately 3.3% at 30 June '26. Turning to Slide 18. We show the key cash flow movements for FY '26. As mentioned, cash decreased by $21.6 million during the year. Key outflows included the class action settlement of $40.9 million, one-off items, including restructuring costs of $20.4 million and Project Arlo investment capitalized of $13 million. These were partly offset by strong underlying operating cash flow of $47.8 million, with the balance funded by $545 million debt drawdown. There remains $35 million of undrawn debt capacity under a syndicated debt facility subject to covenant combined to the ordinary cause. The facility is due for renewal, September 28 through September 29. I Underlying EBITDA of $48.3 million translated into underlying operating cash flow of $47.8 million, demonstrating cash conversion in by favorable working capital movements, including but not limited to the collection of previously secured interest and some improvement in hedge debts. With historical one-off outflows behind us and following the strategic actions taken over recent periods, we remain focused on improving cash conversion and strengthening cash flow management to support financial stability and improve shareholder value creation. In FY '27, we will maintain a strong focus on cash flow management alongside continued advancement in the Arlo Project. In concluding and in summary, FY '26 was impacted by known revenue and interest rate headwinds, some late in the year trailing softness in specific Northern Hemisphere programs. However, the business delivered strong cash conversion reduced net overheads and continue to invest in the operating model and platform needed to support future growth. As noted earlier, on a pro forma basis, absent nonrecurring cash out is expected to roll off in FY '28. The business we've generated $30 million to $35 million of free cash flow and equivalent reduction in net debt moving into the range of $15 million to $20 million by the end of FY 2018. I will now hand back to Anthony to cover the FY '27 outlook and key priorities.

Thank you, Stuart, and I'm sure everyone like myself is waiting until the scripted part is over and we get into the business of Q&A. We look to FY '27, our priorities are pretty simple, turn wins into revenue, activate Arlo and renew IP clients. On the commercial front, success is closing new business deals, improving contract to revenue time growing the pipeline to circa $150 million by year-end, renewing several key contracts continuing our innovation drive across the top 30 and a new mobility solution in live by mid-calendar year. On efficiency, we'll continue to grow our global operations center, working closely with our Arlo implementation team on a workforce shape into the future mindful of digitization and automation benefits we expect. We're also accelerating GI and unifies management across our operational teams. And on technology, we're taking a measured and staged approach to Arlo to optimize its adoption. The U.K. migration will advance during the year with new clients onboarding directly to Arlo and our APAC deployment is planned for the last quarter, ready for FY '28. On guidance, we're guiding to underlying EBITDA in the range of $50 million to $54 million. This factor is an improvement in both customer and interest revenue with interest yields forecast to improve around 20 basis points and overheads at the longer-term average of approximately $110 million. Importantly, as the bulk of the Arlo transformation and legacy remediation expenditure falls away we forecast pro forma free cash flow of $30 million to $35 million in FY '28. That is a surprise, and we see a clear path to it. Naturally, if we shift from a pro forma lens to an actual FY '28 earnings for forecast, underpinned by taking off the objectives I've shared today, then we would expect that to be higher. But our focus is the here and now and will be a lot to close out this year. Transformations of this scale are never easy and they never run perfectly the plan, but we're more capable today than at any point in EML's history, and we expect our commercial performance to improve through FY '27, laying a solid foundation for FY '28 and beyond. Alongside the unflashy foundation build, we're also working on exciting near- and longer-term opportunities with some great clients, partners and brands. Before I open the floor to questions, I want to take this opportunity to thank our hard-working team, including members of our local and global boards, our partners, our customers and of course, our shareholders for their continued support of EML. Thank you for listening to our presentation this morning. We're happy to take questions. Thank you, moderator.

[Operator Instructions] Your first question comes from Elise Kennedy with Petra Capital.

A quick question on your free cash flow forecast, $30 million to $35 million FY '28, what do you expect the FY '27 base to be and some of the moving parts that fall away in that year?

Sure. So FY '27, at least, we'll continue to invest in Arlo to the turn of about $17 million. And we have a range of liabilities already recorded on the books that will result in cash flow out in FY '27 and total approximately $19 million. So of the guided number of $50 million to $54 million they are the 2 largest components. I mean there's -- on top of that, below EBITDA, we clearly have interest expense of in the order of $8 million to $8.5 million, a range of other capital projects. But essentially, we expect cash generated by the business in FY '27 to largely be utilized in cash outflows and operating costs. So no expected borrowing drawdown and no expected material improvement in net debt in FY '27.

And then just talking about some of the other investor price points that we can get as investors. I know previously, there were a few coverages that were under a food when you were looking at clean up the business, how confident and what are some of the signs that we can take that we know what we're looking for in FY '27.

Are you asking if there's any more surprises? Is that essentially what?

And just -- you're just confident can you really go on through the business based on that?

Look, as best we can tell, honestly, as best we can tell, and I mentioned this in my script, this has been very -- there's been a lot of hard work and some real heavy lifting of all of the things that we saw initially and the things that we've uncovered. We think we've bottomed out. But we had -- in the first quarter of last financial year, we had this issue with the platform, which we talked about previously. I've been doing this for 25 years, Elise. There's no way that we could have seen that coming. And so my only caveat is we don't know what we don't know. But I swear to you, look, we have got, I think, world-class people in all of our key roles. We have done an incredible amount of assessment and digging to try and uncover as much as we possibly can, the things that would be genuinely knowable. We know about them, we fix them. We are as well prepared as anybody, I think, to be able to deal with whatever comes at us. The reality is we don't know what we don't know. I don't think there's anything enormous that gets thrown our way, but I don't know what else to add to that.

And then one last question.

As you can see, right, we're prepared to talk about how we return to free cash flow. And we wouldn't be doing that unless we thought we've solved for all of the key issues. And I think you should take that as a positive.

Just on the customer conversion because it's a key way of getting there. You said the conversion rate is on target, but then there were some client delays and challenges in this half. Is that finished now?

The client delays.

I understand the combination. Yes, the customer conversion predominantly the pipeline and how much that's going to convert to revenue.

Yes. So over the past year, I would -- I've talked a bit about the 3 things that have an impact on our run to revenue from contracts. So our conversion in the pipeline from pipeline to contract is definitely on target. The move from contract to implementation, and I've talked about this before, but there are typically 3 things that impact that. One, which was a real problem a year ago, which was us, that's no longer really a problem. The second one is client readiness or capability. So it could be anything from an internal project time frame gets moved or priority changes or whatever it might be, the things that are totally outside of our control that are customer-led, and that will always be an issue. And the size of that issue will ebb and flow depending on the customer and the time of year. We know there are certain time frames where nothing is going to happen. So for example, over the sort of Christmas and New Year period, we know we're never going to implement anybody new in the G&I space because that's when they're really busy. We know that in Australia, we're not going to add anyone new in the sort of March time frame because of FBT. So there are windows where we know nothing is going to happen, but there are equally windows where despite the best of planning and communications and our relationships are immensely measurably better than they used to be commercially. Sometimes plans change within customers and that has an impact on implementation. So that's a perpetual state as in, we can't control it. The third one, which has really had quite some impact in the last half is our partners, some of our partners. And I've joked before that if something goes wrong at Visa or Mastercard, I can get on the phone to the C-suite, but I can't get on the phone to Tim Cook at Apple. So there's just certain partnerships that we rely upon. And we can't influence the way we'd like to. And that -- so there's a difference between conversion of pipeline to contract and then contract to implementation, and the implementation has those 3 elements that can impact. The positive is the ones that we can impact, we've solved for. And we're a lot better at today than we used to be. But the other 2 are in the hands of our customers or our partners, and we can't always control those things.

Your next question comes from Richard Harrisberg with Canaccord.

Congrats on getting through what's been a difficult restructuring and getting the business to where it is now and ready for growth going forward. Just a few questions from me. So firstly, just a comment on the pipeline you're sitting at $109 million now. I believe your previous target was $125 million at June. So is that sort of slightly below your expectations? Or is the delta there just some of the wins that you've announced, which obviously get taken out because that pipeline is as of today, right?

Yes. It's more about the wins. It's not like we're -- we're certainly not going backwards. I think the pipeline is growing, and we're converting as well as we would have hoped from -- as I said, from contract to -- sorry, from pipeline to contract. And some of that's reflected in the new leaders that we've put in place in APAC and Europe.

Yes, I guess just on that, for the new sales team that you've put in, obviously, that's kind of really taken place over the last 12 months, there's a lag to sort of seeing the fruits of that as they get momentum. But would you say sort of the team is now in place for what you need to do to execute? And how much of a difference are you seeing in that translation to pipeline growth and conversion from them? How much of a difference are they really making?

Look, it's relatively early days. The guy that we've got in APAC has been in the seat for 3 months. And the new European lead is still a few weeks out from starting. So look, I think we definitely -- we got it wrong in Europe a year ago, and we knew that. I think we've taken our time seemingly to get that right, but I'm confident we've got it right. So we should expect to see some positive uplift from that. And I think we're already seeing some positive uplift from our APAC hire.

And then also on the pipeline, so the $50 million sort of close to tender completion that you kind of referenced, that sounds really exciting. How competitive are some of those opportunities? What's your sort of confidence on a time line of when you might be able to make some announcements for the next sort of 6 to 12 months? Is that the right way to think about it?

Yes. I think thematically, it is -- there's a mix of -- some of that is in tender, and that's obviously competitive and there's others that are in contract phase. So we feel pretty good about the next 60 days. In terms of announcements, thing I'd flag is many of our significant customers don't want us making announcements about them because they themselves operate in competitive spaces. So it's a little bit of a challenge to be able to name names, for example. But I feel like the methodology of the people -- the things that we've got in the pipeline and the way the guys are managing it and the better quality people that we have today is starting to show the fruits, which is really positive. I think you'll the conversion piece I talked about is from pipeline to contract, that's important. Our real focus has got to be on the point from contract to implementation and how we solve for that. And as I said, there's -- in respect of Australia, in particular, there's a partner here that we can't influence and time lines for what was challenging previously has probably gone from 3 months to 4 and is hurting us. But there are other markets where we don't necessarily have that problem, and we've got activities in place to try and solve for some of those things that are otherwise outside of our control. And we continue working with customers to ensure that as best we can, we can plan around what they believe they can do. And I mean we've been doing that all year, but every now and then, something happens at a customer level, and we can't solve for it. So we'll continue working with customers to ensure that we've got clarity around when and how we can implement. And we'll keep working with our partners to try and ensure a smoother execution. But I think right now, the way that we feel about that $50 million that we talked of, we feel pretty good. The tender piece, you never know. But generally speaking, I would say to you that we're in a much better state than we have been. Our relationships are better. Our product is more stable. Our offering is better. Our pricing is always competitive. So as I sit here today, we feel pretty good about it.

That really covers the growth prospects nicely. I guess on the client renewals, congrats on the renewals you've secured so far. There's obviously a lot to get through. Could you just comment on sort of the size of the 2 that didn't renew? And obviously, you mentioned they didn't go to competitors, so that's always positive. But what were a couple of the reasons for that? And then also just on the conversations that are underway for FY '27, how those are progressing? And also if you're going to sort of try and smooth out the lumpiness for future in terms of contract lengths and so you don't have sort of this big renewal year happening again?

Yes. Yes. So both of those just sort of I think $1 million to $2 million a customer. One closed the program down and the other one has gone to self-issuing, which is a prospect for a small subset of our customers, I guess. They are self-issuing here in Australia, which frankly, is a whole lot easier than trying to do it elsewhere. And so it's not -- I don't think it's a huge or a systemic threat to us. The rules in Australia around licensing are different to anywhere else that we know of or operate in, and that is that the schemes themselves are responsible for licensing as opposed to in all of the other markets we operate in and anywhere else I can think of, the regulators are involved. So it's not a systemic threat to us. And we're not -- since I've been here, I think we've had one customer that's closed down an entire program, and that's the one we're talking about. So again, not a systemic threat.

Really appreciate the color. Maybe just one last one, just on the mobility product. That obviously sounds really exciting and just go-to-market strategy and when that sort of all starts to kick off and your client sort of engagements, what sort of the opportunity? Obviously, it's a $1 trillion market, but in terms of let's say over the next 5 years, how big do you think this can really get like a percentage of revenue for you guys?

Well, let me go in reverse order. My CFO, can he go turn it down, turn it down. Let me go in reverse order. I've said this before that I think that the business that we run today or has been running becomes a segment of our reporting. So that gives you a sense of where I think mobility takes us. What's really exciting, particularly in the last month or so, is the engagement we're having in multiple markets. I said probably 18 months ago that you shouldn't think about entering new markets. I'll recant that now and tell you that we will. What's particularly exciting about this capability is that it doesn't rely upon us necessarily being in the money flow. This is a particularly relevant product offering that is largely software driven. It solves for a whole bunch of problems that occur in this industry, not just moving away from magnetic stripe cards and going to a digital capability where we go to sort of a credit-only offering to a prepaid or debit or a credit offering, a physical, but most importantly, a digital-first offering. It's a capability that we have an integration with that, to our knowledge, is unrivaled in terms of the integration with forecourt controllers and the data that's required to solve issues in this industry. But equally, the fuel card industry on its own, you can talk about for a little while and highlight the current efficiencies in it in that it's all closed loop and it really only relates to fuel. So you can't necessarily understand total cost of ownership of a vehicle unless you've got probably half a dozen systems in today's world. That all changes. But equally, there's opportunity around not just solving for the data and the controls of spend, particularly in an open-loop environment, which by that, I mean, Visa or Mastercard or something similar, which typically hasn't happened before. But I've talked in the past about things like customizable reporting for our customers. So I think fleet managers and controls for corporate expenditure, equally customizable offers for our cardholders. So I think drivers being able to be directed to a particular brand of service station on a particular day given the particular discount from that vendor. There's a whole bunch of capability that we bring to bear or we will start to bring to bear here that the industry just hasn't seen before. And you're right to be excited about it because I'm pumped.

Yes. It sounds like it's definitely the enthusiasm. And well done again on getting the business ready for upward trajectory.

The other thing I just wanted to pick up on, sorry, was the comment about the customer that we lost to self-issuing. It is -- not only is it difficult outside of Australia, but I think inside Australia, it's about to become much harder under stored value changes that are coming. So as I said, it's not a systemic threat, but I'm feeling increasingly confident that it's a one-off. We're not going to see much of it at all.

There are no further questions at this time. I'll now hand back to Mr. Hynes for closing remarks.

Well, thank you, everybody, for your time. As I said a couple of times during my script, not a fantastic year financially in terms of our results, but this company is in a much better state today than it's ever been in my view, certainly much better state than it's been in my time here. We have a cracking team of people, not just at the executive level, but now below them that are executing collaboratively working together, operating as one team, which again didn't occur until we arrived -- there are -- we hope no skeletons left in any closets. We feel like we've cleaned the place up. But we've got some exciting opportunities ahead of us in terms of our new product capability and our new technology, which is awesome. But some of the stuff that we're seeing in new verticals, which I've talked about in the past is super exciting, and you can feel the energy and enthusiasm amongst our team. And with a bit of luck, you'll start to see that, A, in our results; B, in our share price. And certainly, for those of you attending over the next couple of days, you should see it in our faces and voices as we come to meet you all over the coming days. So thank you all for your time. Look forward to seeing those of you we're going to see. And otherwise, we'll talk to you in November for our AGM. Thanks, everybody.

That does conclude our conference for today. Thank you for participating. You may now disconnect.