Thank you for standing by, and welcome to the Carsales.com Limited acquisition and equity raise presentation. All participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I'd now like to hand the conference over to Mr. Cameron McIntyre, Managing Director and CEO. Please go ahead. Thanks, Darcy. Morning, everyone, and welcome to this morning's call. It's a very important day in the evolution and growth of Carsales. Glad you can join us. On the call with me in my office, I've got the Carsales CFO, William Elliott, and I've also got the CEO of Trader Interactive, Lori Stacy. We're gonna take you through the acquisition of the remaining 51% of Trader Interactive via our call option. We wanna talk to you about why this acquisition is so attractive for our shareholders, why we like Trader Interactive, and what our integration and growth plans are gonna be going forward. We've released a presentation on the ASX. I'm assuming you've all got that in front of you. I'll briefly run through the presentation and leave as much time as I can for Q&A. We'll start with slides eight and nine on the transaction summary. As we usually do, I'll call out the slide numbers as we step through and see how we go with the Q&A. Just on slide eight and nine, as you're all aware, you know, Trader is a leading digital non-automotive marketplace business in the U.S. Like Carsales owns great businesses across truck, RV, powersports, and equipment industries. These non-automotive verticals, as we know from our Australian businesses and as you've observed with Trader Interactive, are really attractive markets with a lot of upside, and they tend to be around 10 years behind automotive in their digital maturity. Trader has a strong financial profile and has delivered excellent growth and has a strong growth track record through cycles with attractive countercyclical attributes. Growth and trading momentum are strong and adjusted Q4 revenue and EBITDA of $151 million and $89 million respectively are excellent. More importantly, you know, we've got really good growth prospects into the future with this business. Look, from a valuation point of view, the acquisition price values Trader on a 100% enterprise value equivalent basis of $1.9 billion, which represents a Q4 annualized FY 2022 EBITDA multiple of 21.3x. We think that valuation respects the qual- Well, it reflects the quality of the Trader business from a multiple perspective. It's materially below what we purchased the first tranche for, but with a controlling stake in the business this time around. It's also broadly in line with our trading multiple at Carsales. The other thing to say is, with this multiple we expect the transaction to be low double-digit EPS accretive in the first year of ownership and growing from there. That accretion's underpinned by the strong growth of the business and the financial and capital structure benefits that we'll receive under our ownership. All Carsales directors unanimously support this transaction and will be participating in the equity raise. The strong cash generation of both Carsales and TI will enable us to continue to invest in the business, delever it, and also continue to pay attractive dividends. We'll be maintaining our dividend policy of 80% payout ratio. In terms of leverage, we'll have a net debt-to-EBITDA of 2.7x, which is exactly the same pretty much as what we have today on an underlying basis. We'll be reducing that to below two times within two years, we expect. This acquisition is clearly a highly strategic acquisition for us, with strong revenue growth opportunities and cost synergies being unlocked through our 100% ownership. This will come through the development of new product platforms and intellectual property. As a company, as all you'll know on the call, we've got an excellent track record in terms of delivering long-term shareholder value creation by building scale through our international acquisitions, and we're really very positive about the opportunity that we have with Trader Interactive. We've also provided you in the deck with an update on FY 2022, which we'll take you through later, but we're very pleased with how the business is performing, and it reflects the strength of our Australian and our international operations and the market positions that we occupy. Maybe turning to slide 10. Look, the reasons why we're doing this transaction now are that we've spent the last 12 months getting to know Lori's executive team, and the business, and we're really impressed. We've spent time on the ground in the U.S. And clearly, as you know, Lori's here with us on the ground here in Australia right now. It's fair to say that we have a great business culture connection between ourselves and the Trader Interactive business. To be frank, they just get it. We talk the same industry language, and it just seems like such a great fit. It's a high-quality business, and to be frank, we just wanna own 100% of it. It's also why we structured this investment into two steps, so we get closer to the business and really ensure we understood it. We see huge opportunity here, and we basically just wanna get going. Look, the things we talked about last year, we all remain very positive about. You know, the size of the market opportunity, the long-term favorable structural trends towards RV and lifestyle assets, the market-leading positions, particularly in RV and powersports, the strong business model the company has and the relative under-monetization of customer base are all there. You sort of roll forward to today and Trader is growing strongly. We've got strong conviction on the business with growth opportunities and synergies that we wanna start delivering on. We want Carsales shareholders to realize the benefits of these fully. Now is the right time before we start delivering on them. Move to slide 12. Look, I've already mentioned some of the things on this slide, but wanna quickly repeat a few. The transaction will deliver low double-digit earnings per share accretion to shareholders in the first 12 months of 100% ownership. Trader has market-leading positions in markets 16 x larger than the equivalent Australian markets, with favorable structural trends, particularly towards RV and lifestyle assets. We've got a strong business model of recurring revenue that provides stability through economic cycles and has generated double-digit revenue and earnings growth over the past five years. With our investment, we're confident that we can accelerate that growth. There's significant future growth potential as well, and synergies to be realized through, you know, customer acquisition and customer monetization, revenue diversification, and realizing, you know, the material growth opportunities that we have. Onto slide 13. Look, we estimate that the total addressable advertising market in non-auto in the U.S. To be around AUD 3.2 billion, which is almost two times the Australian automotive advertising market and 16 x the non-auto advertising market. Trader's market share is growing, but the relative monetization against Carsales' peers remains relatively low at about 60% of TAM. As we've seen, Australia and the U.S., there's been a real shift towards the ownership of lifestyle assets. As you can see on that slide, over the last 20 years, RV and motorcycle ownership significantly has increased. We know once people acquire lifestyle assets like these, they tend to remain industry participants, upgrading their RVs and powersport equipment over time. Onto slide 14. As you can see, our market leadership's continued to grow, or we've closed the gaps against nearest competitors over the past 12 months. You know, the strength's particularly apparent in RV and motorcycles as Trader is the go-to place, which reflects the audience and inventory positions against our nearest competitors that we've got. Onto slide 15. Look, across both revenue and EBITDA, we've seen fairly consistent growth over time. In FY22, the growth and EBITDA is up 14% and 17% on PCP, which is a continuation of that trend. More importantly, the business is heading into FY23 with excellent momentum, as you can see from that last quarter annualized performance. Having completed a price rise in March, April with minimal churn, it certainly supports that. Onto slide 16. Look, we're really pleased with how the business has performed over the past 12 months. You know, while we've collaborated well through our 49% interest in the company, the future's in what we can do to realize the company's growth potential and synergies with 100% Carsales ownership. I wanna start discussing that. In May last year, we said that two of the key growth drivers of Trader are the increase in customer penetration and take-up rates. Across the past 12 months, we've seen some improvements in these areas, and a considerable opportunity really remains for us to realize over time. There's, you know, there's also other significant growth opportunities that we do wanna talk about this morning. Look, onto slide 17. Look, we acquired Trader Interactive for its strategic appeal as a standalone business. With 100% Carsales ownership, material growth opportunities do exist. You know, we're gonna realize those over the long term with the company. Lots of scope for product improvement and technology innovation here. Look, a lot of work's been done over the past several months between the Carsales and Trader management teams to really articulate each of these synergies that you're seeing on this slide here now. We're highly confident in our ability to execute on all of them. The key synergy opportunities that we're seeing, and you'll all be familiar with many of these, if not all, are in dynamic pricing, digital trade-ins, media and dealer products, and systems, where we think Trader has enormous upside growth potential. We'll discuss some of these over the course of the next couple of slides. In addition, there's some substantial cost synergies that we'll, you know, the combined purchasing power of Carsales and Trader will see us realize these savings across tech largely, and a more efficient capital structure, which will lead to a materially improved interest rate at a Carsales level. Onto slide 18, just expanding on some of these growth opportunities and starting on the left-hand side of the slide. You know, pricing's an area that's Carsales has developed a strong capability in over many years, particularly in aligning price and value. Trader's early in this journey, and we think we can leverage this capability which has the potential to deliver you know, great yield benefits over time. We think we can deliver upside to revenue growth in this space quickly by moving to tiered pricing in private seller. If you think about 2016, we had a pretty simple approach to pricing via Carsales, and our model was, you know, a pretty much a standard versus a premium ad product. Over time, we evolved to pricing brackets, and now we have a dynamic pricing model. As you can see here, you know, our pricing capability has been refined, and we've been able to double yields in, you know, around six years or so. Look, Trader is effectively where we were in 2016, more or less. We see good opportunities for yield growth here in private seller in the short term, with ongoing upside over the years as we refine there. The online trade-in market is a significant area of long-term growth opportunity. Yeah, as we've been realizing here in Australia through products such as Instant Offer and Encar with products like Dealer Direct. By leveraging our knowledge and capability in other parts of the world, Trader is well positioned to take advantage of this opportunity over time, and we intend to develop capability in this area and leverage the sizable market that exists in the U.S. Onto slide 19. Look, I mean, media is another area of significant opportunity. Given the gap in the monetization rate of Australian non-auto marketplaces versus Trader. In Australia, we have made significant investment over time in our media business and TI can leverage from that, you know, with our product, our tech capability to accelerate their own media growth. Trader hasn't invested heavily in the media business and has limited product sophistication at the moment. We think this is an area of real considerable opportunity as our Australian media business currently is about six times out of Traders in the ad market. That's, you know, and their ad market is significantly larger than in Australia's. I think, you know, from our perspective, we wanna invest in product tech and go to market, and we think there's excellent long-term growth upside. We will of course be cognizant in this space of market conditions when deciding on the pace and scale of investment, as we've done here with our business over time. One of the sources of competitive advantage is the strong focus on developing the capability of our dealers, and you've all seen that over time with us. You know, providing them with world-class systems to drive their business performance and digital sophistication ensures that we're driving customer growth, penetration of key products and supporting continued yield expansion. Given the low penetration of TI, you know, with dealers, we see a very significant opportunity for the business here as well. You know, dealers, as you all know, rely on AutoGate and related tools to manage their inventory and sales opportunity in digital marketplace environments. It's very important. It's a really important platform that we've spent the last 25 years developing and investing in. TraderTrax is a great platform. That's the TI system of equivalence. But dealer usage is still relatively low when we compare to our Australian dealers. You know, what the plan is there is to invest in features so we can increase customer stickiness, improve the quality of data and customer dialogue, and improve dealer upsell and add-on penetration over time. Onto slide 20. We're targeting good double-digit revenue growth and ongoing EBITDA margin expansion over time. We believe increasing contributions from higher margin private seller and media businesses will increase the diversification of the Trader revenue mix and strengthen our EBITDA margin. Look, a focus on increasing dealer penetration, take-up rates and digital sophistication are really gonna ensure that we achieve those growth objectives over time. Onto slide 21. Look, part of Carsales strategy has been for many years been about investing in large high growth markets where we can leverage our intellectual property and tech to create long-term sustainable shareholder value for our Carsales shareholders. On the right-hand side of this slide, Trader Interactive, you know, we've been able to also achieve good industry diversification into less digitally mature and high growth non-automotive markets as well. Slide 22. Look, here are the proof points on our strategy, you know, our strategies continue to perform well for our shareholders over a sustained long period of time. As you can see, our Korean and Brazilian businesses have been excellent growth drivers, and we expect this to continue through FY22 and into FY23. I'd probably also like to point out on the right-hand side there, the Brazilian one, you can see we've delivered 48% revenue growth through the last Brazilian recession, which was a period of extreme high interest rates, as you can see on that chart, and inflation. You know, that business at the time was exactly like the Trader business is today. It had a subscription model. It had low customer penetration rates and take rates and the market lacked digital sophistication through the dealer network. There were lots of product opportunity which highlights the resilience of the business and any business like this through economic cycles. Onto slide 24. Just you know, reviewing the key people and performance of the Trader business and beginning with the brief overview of you know, that most people have probably seen this, but you know, Trader is a multi-brand, multi-vertical marketplace business in the not automotive space, like Carsales is supported by offerings in software data and insights, as you can see, that enhance the capability and information intelligence of our customers. Onto slide 25. Look, as you can see here, I mean, the quality of the management team is a key component for us, in any of our international investments. We wanna make sure that, you know, we have great connections, again, in terms of business culture and values and our own people. With Lori and the team here, there is a strong connection with the Carsales exec team and strong alignment between the businesses. We've got to know the Trader team better over the past 12 months, and those connections have only grown strongly. We're really looking forward to working more closely with them, over time as we get underway. Onto slide 26. Just speaking of growth and looking at some of the major operating performance metrics pre-pandemic to today, like our financial performance, our value proposition for our customers continued to strengthen with traffic leads and leads per dealer, cost per lead, and dealer satisfaction all rising over the past several years. Slide 27. Look, Trader is a business that has proven its ability to remain resilient through economic cycles since the GFC, and it's grown consistently through periods of market disruption. That resilience comes down to a number of sources, such as the development of digital advertising marketing in non-automotive verticals, the need for customers to promote stock in more challenging environments in order to maintain inventory turnover. It's got a subscription model, which means dealer revenue tends to be more stable despite volatility with 84% revenue recurrence. Being on the buy and sell sides of activity and its diversity of verticals provides further resilience for the business as well. Onto slide 28. You know, like the Carsales business, Trader has multiple growth drivers across multiple vertical marketplaces. Over the past 12 months, yield through price rise, in particular, product upsells and increasing customer numbers have been good contributors to dealer revenue growth. Private seller, particularly in RV advertising volumes, has been solid, a solid performer for the company. The only challenge has really been in truck, where a lack of inventory availability has remained acute and led to some customer churn over the past 12 months, although customer numbers have been rising consistently since about January this year. Subscription-based business models like Trader tend to deliver consistent levels of recurring revenue over time, but you know, can be sensitive to inventory availability, where inventory levels and revenue tend to be more positively correlated. Since the beginning of the pandemic, Trader's business has seen inventory levels you know, decline across most verticals, but we're slowly seeing that trend reverse and should provide us with you know, additional growth opportunities moving forward. Just in terms of slide 29, over the past quarter, in a rising inflationary market as well as uncertainty around the economy, we've seen leads and traffic to our sites remain very strong, with traffic up 28% year to date on pre-pandemic levels. In parallel, we've also seen ongoing strength in our financial performance with revenue and EBITDA up very strongly against pre-pandemic levels. Maybe, Will, you wanna take from here? Yeah, good morning, everybody. Just moving to slide 31. Look, I think Cam covered some of this detail in his summary of the transaction. I'll run through a few additional details around the funding of the transaction. The purchase price is being funded by equity. The equity funding of $1.2 billion is via an accelerated renounceable rights issue, and we think this is the most appropriate structure for all eligible shareholders to participate, recognizing the current market conditions. Look, from a debt perspective, we are replacing the $519 million worth of debt that sits at the Trader Interactive level with incremental debt at the Carsales level. We will upsize our current facility from $900 million - $1.4 billion. The debt will have multiple tranches with different maturities, multi-currency drawdown capability. This will enable us to retain a level of debt denominated in U.S. dollars, to ensure we still have a natural hedge against USD/AUD fluctuations. Replacing the Trader Interactive debt will bring significantly improved pricing from a margin perspective, given Carsales has much lower overall leverage. We expect to complete late in Q1 of FY23, and post-completion, our leverage ratio will be about 8.7x net debt-to-EBITDA. This is similar to our current leverage on a look-through basis. Look, we believe this is a good balance, particularly given our balance sheet does delever organically, given the attractive free cash flows that we generate and also that Trader Interactive generates. Most importantly, we anticipate coming down to under 2x leverage within two years. Onto slides 32 and 33. There's quite a lot of information on these next two slides. I won't go through all the detail, but I'll just call out a few key points. The pro forma historical performance shown on page 32 demonstrates the impact of moving Trader Interactive from a 49% equity accounted associate to a 100% consolidated subsidiary. Under 49% equity accounting, we showed our share of Trader Interactive's profit through one line. Going forward, we'll show all the revenue expenses of the Trader business in our consolidated group numbers. The slide also illustrates how moving to 100% ownership delivers EPS upside to shareholders, and it's delivered in three primary ways. The first is through adding more earnings from a high growth business. The second is through interest cost savings from a more efficient capital structure. The third is the favorable tax position that Trader has. The interest cost savings are shown in the adjustments column, and these reflect the benefit from replacing the expensive debt at the Trader level with debt at the Carsales level. In terms of Trader's tax profile, as you can see from the small tax expense in the P&L, this attractive tax profile is driven by deductions for purchase price intangibles, carry forward losses, and R&D tax credits. These benefits will be inherited by Carsales post-acquisition. As detailed in note B, we expect we'll see Trader Interactive pay minimal tax in the first full year of ownership. Then on to slide 33. This just shows the pro forma impact of the acquisition on the balance sheet and the resulting net debt position had the acquisition taken place on the 31st of December. Moving on to slides 35 and 36. I mean, the focus is on Trader Interactive, but given the proximity to year-end, it's appropriate for us to provide a more specific update on FY22 earnings guidance. The estimated results for FY22 show the continued strength of our Australian and international businesses and the growth contributed through some of our key product focus areas. There's also some detail around current trading observations for both the domestic and international businesses. Again, I won't go through all the wording in detail, but we really do enter FY23 with excellent momentum given the strong results in the second half of FY22. We are seeing excellent activity on our sites across the world, and we are continuing to expand the penetration of key products in our Australian, US, Korean, and Brazilian businesses. This positions us well to continue delivering great results in FY23. Moving on to slides 41 and 42. These provide additional information on the equity raise and timetable. Oh, sorry, that's not. I think I've got the slides wrong there. 38 and 39. These provide additional information on the equity raise and timetable. Won't go through any of the information there. That's it on the financial slides. I'll now hand back to Cam to conclude. I think we're ready to go to Q&A, Darcy. If you wanna open up the lines for questions, that would be great. Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from Sheri Reykofski from Credit Suisse. Please go ahead. Morning, Cam and Lori. Maybe if I can just start with, this is a question I know you've been asked a bit over the last 12 months, but just confirmation that this was the exercise of the option that was in place. The rationale for the exercise now, given the potential slowdown of the U.S. consumer. I mean, you've obviously spoken about the stability in earnings and perhaps whether we should read into it that you still think earnings will grow at Trader into FY 2023, notwithstanding any consumer slowdown. Yep. Thanks, mate. So to confirm, yes, it is us exercising our call option. Look, the rationale is in short, you know, we've spent the time with the business. We love the business. We love the people. There's great connection. We've spent a lot of time on working out where our strategic opportunities are and where our cost synergies are. I want Carsales shareholders to realize 100% of the benefits that we're gonna start delivering as opposed to 49%. That's it in short. Okay. Got it. Sorry to sort of dwell on this point. Clearly there are overarching economic concerns in the market. Should we still expect that you can deliver growth notwithstanding some of those concerns? Yeah. I mean, that's what we've positioned the company for. We're confident about the execution and delivery of you know, all the growth opportunities that we have. I mean, you can see in the deck that Q4's continued to perform really well. You know, we're very excited about you know, where this takes us over the. You know, it's a little bit about the short term, but it's a lot about the long term as well. Got it. Sorry, a couple, well, quick ones, hopefully. Sounds like you're pretty comfortable around the availability of the tax deduction. Is there any scope for a rate of step up than what you've got factored in? My understanding is part of it was the availability of goodwill as a result of the transaction. Could you build up some additional goodwill as part of this purchase and have that deductible longer term as well? Is any of that factored in? Yeah. No, thanks, Sheri. It is. We do get a step up in the deduction for goodwill amortization as part of the transaction. That's not the full amount of the benefits that you see that we've combined in the pro forma P&L. I think the, you know, obviously one of the drivers of the deal being so attractive from an EPS perspective is that tax profile. I think as I mentioned, we're not expecting to pay material tax in the first full year of Carsales ownership. That goes to both the amortization of goodwill and some other benefits that we're gonna get, which includes some prior period tax losses and some R&D credits that we're gonna get. The amortization benefits will last for about nine years. The other benefits which help with minimal tax in the next few years, they will fall away, but there will be an ongoing benefit for the amortization. Okay, that's great. Just the final one, the debt cost that you've presented on slide 32, do they reflect the recent increase in the BBSW and just interested in whether the debt is locked in or whether you'd need to go out to market to lock in some new debt? Yeah. The debt on that slide does reflect the current BBSW rates. I think, you know, the EPS accretion statement we have made does factor into account the fact that, you know, there's a changing profile out there from an interest rate perspective. I think the important thing to note is that the EPS accretion statement is made on the basis that in whatever interest rate environment we end up being in, Trader's debt was always gonna be more expensive than Carsales because of the leverage. The benefit we're getting in any environment is that we're gonna pay lower interest by moving to 100% ownership. Okay. Got it. Very clear. Thank you. Thanks, Sheri. Thank you. Your next question comes from Eric Choi from Barrenjoey. Please go ahead. Good morning, team. Just on the option again, I guess you previously disclosed if you didn't exercise that call option, the other shareholders kind of forced a sales process to other parties instead. I'm just wondering if that risk played into the why now, i.e., were we nearing the expiry of that call option? Thanks, Eric. As you know, we've said nothing about the call option ever. We'll continue to say nothing about the call option. There's other parties to the transaction aside from ourselves and, you know, that whole call option, as you know, has been held in commercial confidence, and we'll continue to do that. Got it. Thanks, Cam. Sort of a related question. Can we maybe talk through the valuation methodology used to come to the purchase price? The reason I ask is, bond rates have probably just hit 200 basis points since the first acquisition, so I'm thinking it's probably not DCF based. Was this sort of a predetermined multiple or a nominal valuation that you guys had agreed to? Will? Yeah. Look, I don't think we'll talk to the merits of what was in the call option. I think what we're paying Encar is a price that we think reflects good value for shareholders and current market conditions. You know, the multiple is lower than what we paid for the first 49% tranche, and it obviously includes us taking control. From that perspective, we think it's reasonable. If you look at it in comparison to Carsales' current trading multiple, it's quite close. Obviously, you know, EBITDA multiple is one method of valuation. Given the tax benefits that we've sort of talked through on the call, you know, from a net profit multiple perspective, it's obviously, you know, much more attractive as well. I think all those things add up to what we think is gonna deliver excellent pay for shareholders. You can see that through the accretion that we're expecting to generate in the first full year of ownership. Very clear. Maybe one for you, Will, or for you, Lori, on the operations. I think you're expecting TI FY22 ranges and EBITDA to be $142 and 31 million respectively, and that's pretty similar to the LQA numbers of $129 and $80 you gave us at AGM. My question is, that new LQA EBITDA of $89, could that be pretty close to what you end up delivering in FY 2023 as well? Lori, do you wanna have the other one? Hey, Eric. When you think about the comparison to the prior numbers, what that doesn't take into account, what really is driving that number is at the end or mid of last year, 2021, we started to really see the decreases coming from the cycle inventory and the truck inventory, which were reflected in that. Beginning of the year, we've seen cycle and powersports start to rebound really nicely, so we're in a really good position there and seeing good growth. When you get into truck, it's stabilized, so we feel like we'll be able to grow from where we are now. As a subscription business, as you know, this really becomes the benchmark to grow from. Last year really reflects just a very weird anomaly around inventory, and so we feel comfortable with the numbers that are in our forecast now. Lori, just on the RVs, I mean, we can see the inventories have improved back to pre-COVID levels. Have we seen the full benefit of subscription up tiering and subscription returning? I'm trying to get a feel for if that 89 LQA number has the full benefit of the RV rebound within that. Yeah. Got it. Yeah. I think for RV, we're actually continuing to see inventory increase. It came back and rebounded nicely. I think dealers still feel they're a little light on the motor home side, so I would expect to continue to see inventory increases there. Really, what happens when inventory comes up, it's not so much inventory packages that are driving, that's a small percentage of the difference, but it's really in the confidence of the dealers where they're needing to sell this inventory, so they're doing more premium listings, more enhancements, retargeting, adding on new offerings. We see that has been growing nicely. We see that continuing to grow nicely. Then, of course, as we do price lists, as we get additional customers to onboard, again, we introduce the new products that Cam was talking about. There's still plenty of room in that industry as well, and we feel very optimistic. Thank you, Lori. Thank you. The next question comes from Kane Hannan from Goldman Sachs. Please go ahead. Hey, guys. Thanks very much. Maybe just TI in that fourth quarter margin, I think it was 59%. Is that how we think about the starting point for 2023? Or is that just a timing benefit of some of its price rises coming through and maybe the annual sort of wage inflation costs are afterwards? Will? Yeah, look, I think it's a reasonable starting point. There's not a lot of seasonality in the TI business from a financial perspective, Kane. There's seasonality in traffic and interest on site. But again, because of the subscription nature of the business, you tend to not see a lot of seasonality from a revenue perspective. There's a marginal step up in some of the non-dealer-based revenue in Q4, so you might see margins a little higher in Q4. But overall, we think that, you know, obviously there's gonna be a decent improvement in margin between FY22 and FY23. Perfect. Just on the dynamic pricing, just how are you thinking about, you know, sort of implementing those RV price tiers that you've talked about? I suppose the risks of doing that into any slowdown in the U.S. economy. Lori, you wanna take that? Yeah. We're actually quite excited about it. I mean, right now, if you go to the site, we really, you know, have three offerings, and it's based on featured versus actual unit price. I think there's a real opportunity to do phase I, regardless of the environment, which is what, you know, Cam mentioned with the buckets of tiers. I think it's a great starting point for us to test and learn, but we expect to see good growth coming out of that. I think the real opportunity is when you can actually get to real-time pricing. Even then, you know, market conditions dictate it, right? There's really not a risk associated with it. It's just gonna price it accordingly to what the market will bear. We feel really comfortable competing and think that it's gonna be a nice way to drive high margin offerings as well into the company. Perfect. Is it right saying we start with RVs and then expand into the other segments if it's successful? How do I think about moving into the other categories as well as TI? Yep, exactly. We're gonna start in RV. It's obviously the biggest book of business we have for private parties, so we're gonna start there. We see it over time extending across the platform, and really that it can be a viable option for any other verticals. Thanks for the details. Thanks, Kane. Thank you. The next question comes from Paul Mason from E&P. Please go ahead. Hi. We've had a few questions asked, but I just have one quick one on the monthly visit metrics that you guys have put up. Some of them look like they're a bit lower than when you made the initial acquisition. Some of the charts that follow on that sort of good things have just gone up differently. I was just wondering if you could comment on sort of what's gone on with that monthly visit stats, RVs and Powersports. Will, do you wanna do that? You know, happy to take that, Paul. So look, I think there was a period where activity on site in RVs and Powersports at the height of the pandemic really took off. The activity on site is potentially a little bit lower than those levels now. I think what we've shown throughout the presentation is that versus pre-pandemic levels, the traffic is up significantly. I think Cam referenced 28% versus pre-pandemic. That is holding firm in terms of that level above pre-pandemic. No doubt there was a spike at the height of COVID when people obviously couldn't travel internationally. I think the really positive for us is that we're seeing those really strong levels of growth over pre-pandemic persist now that, you know, international travel's opened up. Sorry, I just wanted to clarify one point I made when I was talking about the funding of the transaction, which someone pointed out to me. I said it was a renounceable offer. It's a non-renounceable offer. I just wanted to clarify that, so. That was all from me. Thank you. Thanks, Paul. Thank you. Your next question comes from Darren Leung from Macquarie. Please go ahead. Good morning, guys, and thanks for the opportunity. Just three quick ones from me. Just want to understand a bit more around the strategic rationale. You mentioned that you can capture more of the economics on the 100% ownership scenario, and, you know, you can be powered sort of all the strategic opportunities you can pursue, like dynamic pricing, et cetera. I'm struggling to understand why you probably haven't been very successful over the last 12 months, please. The reason why we haven't been successful is just because the ownership structure of the business was focused differently. We're a minority shareholder, and the ownership structure, you know, the priority of the business was different. Now that we are gonna be the owner of the business, we're focused on long-term growth opportunities, not short-term. You know, we sit down with Trader, we come up with, you know, a combined product perspective around where we can deliver the best opportunity short, medium, and long term for the business, and we start with that. It was a prioritization between, you know, existing shareholders and new shareholders, effectively that was the difference. Sure. Understand. Thank you. On the synergies piece, you mentioned there's cost synergies coming. Is there any indication for us to think about this? Will? Yeah. Look, I think, Darren, it's fair to say the biggest cost synergy or efficiency we're gonna get is the capital benefits I talked through around, you know, moving the debt out of Trader into Carsales. That's quite material, and you can see in the P&L that we've quantified what that would've looked like on a historical basis. It's in the region of AUD 14 million. The other cost efficiencies primarily come from purchasing synergies around technology contracts, so AWS, Google, those sorts of things. We can get, you know, discounts by bringing ours and Trader Interactive accounts together. Now, they're not as material as the interest savings that I talked about, but they are decent, and they're the key driver of the other cost efficiencies we'll get from bringing the businesses together. Maybe just a final one from me just on that point. Can you confirm what the sort of rate is at the moment on the PIK debt versus what the new facility is or that you're planning to get to? Then the sort of, I suppose, follow on from that is it looks like the net debt balance has actually increased in Trader since the acquisition six months ago. So given we haven't really seen a dividend out of Trader, I would've thought the net debt balance would have gone down, but just keen to understand what's moved in the balance there. No. Two-part question. Debt balance has come down. We've repaid debt. Maybe in Australian dollars when you translate it's, that may be impacting it because it's obviously denominated in US dollars. To your first point around what's the rate, it's close to 6% all in at the moment. We're not specifying what rate we think we're gonna get under the new deal because we are, you know, currently undertaking a refinancing that will be obviously subject to where rates move. I think the point that I made previously was around the difference between what we can get at Trader and what we can get at Carsales is around the 2% mark in terms of the margin above the base rate, and that's LIBOR that we were paying in the U.S. and BBSW in Australia. That's clear. Thanks, guys. Thank you. Once again, if you wish to ask a question, please press star one on your telephone. The next question comes from Wei-Wei Chen from RBC Capital Markets. Please go ahead. Hi, guys. I think thanks for taking my calls. Couple of questions. Just on the last question, the differences between new shareholders and old shareholder priorities, are you able to give some color on, you know, what some of those differences were, and was that a driving factor in, I guess, picking up your option? Look, I mean, the priority differences are, and thanks for the question. Priority differences are, yeah, the previous shareholders, our partners, were private equity and private equity, you know, their timeline is not long-term like ours is. We're strategic investors. You know, our view on the business is long-term. Yeah, I mean, clearly, if I'm a short-term investor, my priorities have to be around, you know, driving short-term outcomes. Carsales is about, you know, making significant change to the business so that we're driving long-term outcomes for shareholders that are sustainable and growable over the long term like you've seen us do with Encar and Brazil are really good examples of, you know, how we go about things. Yeah. Can I just clarify? Were frustrations, I guess, with that business and priority kind of a driver of taking up the option? No. I mean, yeah, our partners there were awesome. Like, we really got along very well. They were extremely accommodating, excellent to deal with. No, not at all. It was. It's just, you know, we see significant opportunity. We've got great alignment, and we wanna get on with it, and that's it. Just last one. Of the 51% that you're acquiring, how much of that is owned by management? Just wondering if you've put anything in place to ensure key personnel remain. Lori, do you wanna talk about them, and Ben? Yeah, sure. I mean, clearly being in private equity, right? There's some compensation that has ownership there. I really, with Carsales, we spent a significant amount of time working with consultants and really completing a remuneration study to say, you know, we were in a pre-private equity. We were in a family organization. I think shifting to private equity, the remuneration was more of a shock. I think coming into a more standard structure similar to Carsales is what we're really used to. I think that offers a strong plan with both short-term, long-term incentives. I think outside of the remuneration part, I think what we're most excited about is that we have a team that we're aligned with, that we're excited about working with, and that we're, you know, really wanna be able to move forward on some of those longer term, you know, transformations within the company, and I think that's really what people are gonna be most excited about. Just wondering if there's anything that you have in place to ensure that key personnel remain? Yes. No, I mean, we've as Lori said, we've put in a remuneration structure that's compelling, and we made sure that we've you know retained the talent, great talent that Lori's got in the team. Yeah, we're very comfortable that we're in a great position moving forward. That's been put in place. Okay. Thanks. I think that's all the questions, Darcy. Yes, that's correct. There are no further questions. Excellent. Well, thanks everyone for joining the call this morning, and we look forward to catching up with you on our travels over the course of the next 24-48 hours. Thanks, everyone. Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.