Thank you for standing by, and welcome to the G8 Education Limited 2024 H alf-Year results. 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 would now like to hand the conference over to Mr. Pejman Okhavat, CEO. Please go ahead. Good morning, and welcome to the 2024 Half-Year Results call for G8 Education Limited. My name is Pejman Okhavat, and I'm the Managing Director and CEO of G8 Education. I'm joined today on this line by the group's Chief Financial Officer, Sharyn Williams. Sharyn and I will take you through the investor presentation that was released to the ASX earlier this morning. Following the presentation, we will open the line for Q&A. To begin with, I'd like to start by acknowledging the Gadigal people of Eora Nation for the traditional custodians of the land on which we are conducting this presentation today. We respect their spiritual leadership and relationship with the country and pay respects to the elders, past, present, and emerging. I extend that respect to any Aboriginal and Torres Strait Islander people joining us today. I would also like to acknowledge the G8 Education team, who passionately support children's outcomes and play a pivotal role in our society and local communities. This morning, we will cover a summary of the six months ended 30th June 2024, providing an update on our progress, outlining our operating and financial performance for this period, and conclude with a brief current trading and outlook. Beginning on a slide six, we have delivered a number of achievements during the half, along with earnings growth in a challenging environment. Earlier this year, we called out our focus on a number of high-impact areas, including maintaining our team engagement position, delivering a strong enrollment and transition outcome, improving operational execution and a Fit Core, and maintaining our strong cost and capital discipline. Pleasingly, we've demonstrated traction across all of these areas in a period where the sector has been under pressure from affordability challenges for families, numerous regulatory inquiries, and continued workforce constraints. Firstly, the group's financial results reflect solid earnings growth compared to the prior comparative period, driven by higher revenues and margins. This reflects an improved enrollment and transition period, a focus on achieving value from our cost base, and our improved portfolio quality as we exited some underperforming centers. Occupancy was above PCP for the first half, a reflection of the positive enrollment transition period and also network optimization initiatives. Occupancy continues to be supported by the positive trend in increased frequency. However, we have seen some flattening of this trend from May onwards, a reflection of the challenges associated with the cost of living and affordability and the impact this has on discretionary bookings. While sector challenges around the availability of the staff have somewhat improved, constraints remain. We have continued to alleviate the impact within our network, as evidenced by our lowering of vacancy rates and further decreasing agency usage. Progress continues to be made towards improving the experience for G8 families, measured through our Always On customer service survey that provides our operational team with regular center-specific feedback. Strong operating cash conversion through the period and the stronger earnings set the balance sheet up well for a second half, with the group today announcing an on-market buyback. The approach to CapEx continues to be guided by our capital allocation framework as we continue to invest in center resources, IT, and property, with a spend flat on prior year. As a group, we are focused on delivering on our purpose, creating the foundations for Learning for Life, while improving our execution capabilities as a business and supporting communities and societies more broadly. Now turning to slide seven, which outlines a positive operating financial performance versus the 2023 half-year of circa 20% growth in both EBIT and NPAT. This is a result of a combination of revenue growth, portfolio optimization, and solid cost management, particularly in labor-related areas such as agency usage and network support office cost. From a statutory perspective, net profit after tax and earnings per share both increased by over 33% after including non-operating items, as outlined on the slide 16. This resulted in a fully franked interim dividend of AUD 0.02 per share being declared, representing 81% of the reported CY 2024 half 1 NPAT. A combination of a positive enrollment at start of the year and portfolio optimization has resulted in occupancy for the period of 68.2%, which is 0.8 percentage points above the prior year. From a spot perspective, the slowing in the sector has also impacted G8, with year-to-date occupancy contracting to 0.7 percentage points above prior year, and our current spot rate last week being slightly below the same week in the prior year. Slide eight reflects our commitment to drive a sustainable future through our ESG journey. A key focus for the past period has been our sector advocacy through our participation in the multi-employer bargaining process. We are proud that this has resulted in the government supporting funded 15% pay increase over a two-year for ECEC employees. The detail continued to be worked through for the December 2024 proposed implementation. From an emission perspective, we achieved a 10% reduction in the Scope 1 and 2 emissions, and transitioned 61% of our vehicle fleet to hybrid vehicles. The first phase of our solar installation in CY 2024 half one has generated the equivalent of approximately 24 average G8 centers worth, worth of solar power for an entire year. G8's efforts to be an attractive employer through team recognition, flexibility benefits, professional development, and incentive programs have been recognized with the groups being ranked 5th in the South Australia's top 10 desirable workplaces. We have also reduced our overall gender pay gap. Improved quality ratings results were achieved during the half, with G8 results remaining above the sector for meeting and exceeding. We continue to build on our Reconciliation Action Plan, with 86% of our centers having now commenced or published a Reconciliation Action Plan. Moving to slide nine, our balanced scorecard. We continued our focus on refining our operational execution and enriching our families' everyday experience. Maintaining momentum in our team-related outcomes, improve the quality of network through improving our National Quality Standard results and portfolio optimization. In all our strategic focus areas, we have made positive progress since the end of 2023. Whilst occupancy is ahead year to date, we are conscious that there has been a slowing recently, and the broader sector headwinds, in particular from affordability, that are being experienced. We are pleased with our solid team retention outcomes, up 6% on PCP to 76%, and the 43% reduction on PCP in vacant roles across the G8 network. On the back of these significant improvements, we are able to reduce further the use of high-cost agency fees down to 0.3% from 2.2% in PCP. Quality assessment ratings of meeting or exceeding have increased to 91%, which is 2% ahead of the long daycare sector average. From a family perspective, NPS has increased to 48, up 16 points on PCP, a reflection of our continued focus on responding to a regular feedback center by center. Now turning to slide 10. Our team results continue to be highlighted with our reduction in team vacancies, strong retention, and improvements in enrollment participation, participating numbers for our development programs. There are tangible results from these investments across our cost base, quality and NPS, particularly from having more stability and capability in our team. Getting to slide 11. The experience our families have is top priority for us and is critical for improving our occupancy performance. The trend in NPS has been positive as we cycle the implementation of our Always On NPS program. The themes we have seen over the past 12 months from the family feedback have resulted in development of initiatives that support our center managers to respond to our families' needs and wants, thus improving their experience. Supporting occupancy this half has been an increase in frequency. However, as mentioned before, there's been some flattening in this growth. Likely, a result of increasing affordability challenges impacting discretionary bookings. We continue to leverage our data and analytics to help families to efficiently utilize their Child Care Subsidy and maximize the opportunity for the children to increase their ECEC participation. The final experience measure is family retention, which has seen an improvement on PCP. We continue to leverage on improved team retention and stability, high quality, inclusivity, and age-appropriate educational programs, and deepening relationship to retain our families. Getting to slide 12. Delivering better outcomes for children, families, and team is at the heart of all we do and key to our success. Our continued investment and focus on quality has resulted in another period of improvement in our national quality ratings. With 91% of our long daycare centers meeting or exceeding the national quality standard, which is now 2% better than the LDC sector average. As always, there's an ongoing focus on child protection and safety across our network. The implementation of internal quality measures is a reflection of the proactive approach required to ensure we continually improve our quality. The opportunity to leverage digitization through a dedicated compliance management system will further enhance these improvements, increasing visibility and capture efficiencies. In line with numerous state governments, a key strategic focus is on the three-to-five-year-old offerings, with the recognition of the benefits of early education continuing to increase. Critical elements of this offer include improving our ECT retention rates, continuing our study pathway programs, increasing our ECT teacher registration support, and growing our teacher workforce. Turning to slide 13. Group occupancy has started the period positively with an improved enrollment and transition outcome, coupled with portfolio optimization as the half progressed. Coming out of May, there's been a slowing in the momentum, with inquiries lower across the sector and frequency flattening. Both signals that affordability is likely a potential driver of family bookings to reduce some bookings. In terms of our progress to develop a Fit Core, we continue to simplify work routines, introduce digital tools for our center managers and area managers to assess performance in real time and improve workforce planning, delivering better team utilization, and reducing agency reliance. Now moving to slide fourteen, our financial stability. The half produced a stronger earnings profile, resulting in a strong operating cash flow and a conservative balance sheet position. Our capital allocation framework continued to guide investment, with CapEx level being in line with the prior comparative period. Our disciplines in cost management, particularly in variable costs, combined with our strategic procurement programs initiatives to lower costs of doing business, resulted in delivering better earnings for the year. Optimizing the center network remains an important element of Group's strategy and is a fundamental basis for creating a profitable portfolio for G8. During the half, we exited 18 underperforming centers and opened two new locations. In Q4 last year, we indicated our intention to divest 31 of our centers through a sales process. As of today, we have divested 18 of these centers, 16 in the first half. They exited multiple of circa two times pre-AASB 16 losses, in line with the commercial approach we committed to undertake with these divestments. We will provide a further update at full-year results. I will now hand over to Sharyn Williams to take us through the financial performance information and more details on our portfolio optimization. Thanks, Pejman. Focusing on our Group financial performance on Slide 16, increased revenue and disciplined cost management resulted in operating and statutory NPAT growth, along with margin expansion. The first half center operating EBIT grew by almost 12%. A combination of improved performance from operating centers and divesting underperforming centers contributed to improved earnings and margin outcomes. Support costs were well managed, with headcount remaining flat. We did accrue an extra amount in support office as a bucket for incentives. We'll know a bit more in the second half about how much relates to centers versus support office. The group net finance costs were flat versus PCP, reflecting a slightly higher RBA rate on lower average debt levels. The combination of stronger center performance and prudently managed network support cost increases resulted in a 20% increase in operating EBIT and further recovery of group margin. In terms of our non-trading items, software development costs reduced significantly as we flagged in February, with the predominant driver of non-operating costs being the divestment of underperforming centers, impairment of predominantly AASB 16 right-of-use assets, and a slight increase in the provisions we have for historical, regulatory, and legal matters. The result is net non-trading expenses are below the prior year. Turning to Slide 17, where we focus on center performance. The center network delivered higher revenue and earnings than the prior comparative period and experienced margin expansion. Occupancy was ahead of the PCP by 0.8 percentage points, and revenue increased circa 5.5%, reflecting the January and July fee reviews, our higher occupancy, but also offset by revenues of centers we have exited. Employment costs demonstrated strong discipline and positive outcomes from our team retention results. Wage inflation increased by circa 8%, including on costs, when we compare the six-month period of June 2024 to June 2023. This uplift reflects the annual award increase, effective in July 2023 of 5.75%, increases in pay rates as our team increased their qualifications, and additional on costs in some states, along with an increase in the superannuation rate. Buffering this inflationary impact are wage efficiency improvements, lower agency usage costs, and the removal of wages relating to divested centers. A continued benefit of our team, improved team retention and lower vacancies, is the further reduction of agency usage to 0.3% of wage hours, down from 2.2% in the prior corresponding period. Given team costs are our largest cost line, this strong result contributed strongly to our margin recovery. Rent is another material cost for our business. Rent expenses increased 3.7% on PCP, noting divested centers mitigate this increase somewhat, and excluding those, the increases are circa 4.6%. This reflects the composition of our network, where we have a combination of CPI and fixed annual increases. The higher CPI flowing out of the second half of last year, where leases would have been linked to June, September, December CPI results, in an increase slightly above CPI for the June 2024 half year. Depreciation increased slightly versus PCP, with an increase of circa one million, offset by the reduction in depreciation due to a reduced center network size. Other costs saw some increase as a percentage of revenue in the first half. These costs relate to direct costs of servicing our bookings, administrative overheads, and property utilities and maintenance. Out of these costs, where we did see an increase in expenditure in the first half, was in the property utilities and maintenance area, particularly in Q1, as we sought to ensure our centers presented well for enrollment and transition. These are largely timing differences, and in the second half, we expect these costs to be more in line with second half 2023 as a percentage of revenue. With overall expenses increasing 4.5% versus revenue of 5.5%, center margins improved by 0.8 percentage points to 15.1%. Similar to the previous year-end result, improvements continued due to the benefits of reduced external labor usage, effective cost disciplines, and an active response to inflation. I'll now touch on capital allocation. The group declared a AUD 0.02 fully franked interim dividend and 81% payout ratio of the first half earnings. Slightly higher than our full year dividend policy range of 50%-70%, given the first half earnings are seasonally lower than the second half. The group has a strong balance sheet, with conservative leverage level of less than one times and ample liquidity. And we're pleased today to announce we will be commencing a buyback of up to 5% of the issued capital of the company. Cash flow generation was strong, with cash conversion of above 100% and operating cash flows of AUD 31 million after interest and tax. Of this, we invested AUD 15 million in CapEx, similar to the prior comparative period, and paid our larger final dividend of AUD 24 million during the first half. This results in a free cash flow deficit for the half of AUD 8 million, as expected, due to the lower first half seasonal profile of our earnings. We also expended AUD 6 million in exiting loss-making centers that we announced in late CY 2023. The result of these movements was net increased by about AUD 10 million since December 2023, resulting in a leverage of 0.5 times. The group maintains a strong balance sheet, with net debt at the half of AUD 68 million. We have access to a further AUD 156 million of committed bank debt facilities, and we will be reviewing our debt funding facilities in the second half of 2024, given we have an upcoming expiry in December 2025. Capital and cost management discipline will continue to be a focus as the group builds capability towards a more consistent and efficient operating model. Pejman will now talk through the current trading and outlook. Thanks, Sharon. I will now speak to the current trading. Our efforts continue to be maintaining our rigor on execution and family experience. The group's spot occupancy is 72.7%, 0.1 percentage points lower than PCP, and our year-to-date occupancy is 69%, 0.7% higher than PCP. Our family experience, measured by NPS, continues to improve, coupled with optimizing our conversion and family turnover in a low inquiry environment. A fee increase of 2.4% was implemented at midyear, mitigating inflationary impacts while ensuring we balance family affordability. Putting our capital allocation framework into practice with diligence, we estimate 2024 CapEx expenditure to remain circa AUD 40million-45 million, contingent on construction capacity, timing, and cost. Network optimization is ongoing, with three centers divested and one center exited post 30 June, totaling 22 year to date. Currently, net debt is AUD 90 million. We are maintaining a conservative leverage position to support the commencement of an on-market buyback of up to 5%. The volume of the buyback will be determined by appropriately balancing shareholder returns and leveraging levels, funding the strategic priorities, and other funding needs, including network optimization and dividend payments. Now to outlook. CY 2024, half two sector conditions are anticipated to be more challenging, with themes such as sector inquiries remaining lower than PCP, net supply growth remaining steady at 3.3% year on year, and cost of living pressures continuing to be a key factor in our families, resulting in their discretionary spend. The government and regulatory environment is evolving slowly. Recently, the federal government made an announcement to fund a 15% wage increase for the ECEC sector over two years, with a condition of capping fee increase at 4.4% for 12 months from the eighth of August 2024. The Productivity Commission final report is due to be published by November, and we continue to be involved in the multi-employer bargaining process. Our near-term focuses remain on maintaining our team engagement momentum, improving our family experience, and delivering an improved enrollment and transition program going into next year. From an operational execution point of view, targeted focus on underperformance centers, maintaining capital and cost disciplines, implementing Fit for Strategy plan initiatives leading into 2025. We remain focused on delivering full year outcomes. I'm now going to hand back to the moderator to enter into the Q&A session. Thank you. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. 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. We ask today that you please keep to one question per person, after which you may then rejoin the queue. Your first question comes from Tom Tweedie with MA Moelis Australia. Please go ahead. Good morning, team. Thanks for your time this morning. My one question I have at the moment is, just of the occupancy growth of 0.8%, for the half. Are you able to give a sense of X, the divested centers, how the occupancy performance went, with the remaining sort of 414 centers? Good morning, Tom, and thank you for joining, and thanks for your question. Tom, as we spoke even at end of year and then at AGM, I think we're gonna maintain the kind of our occupancy is our occupancy. Not gonna really break that detail out. You know, our job is to pull whatever levers that is available to us to improve our overall group occupancy, and that's what we're doing. All right. Not a problem. I'll jump back in the queue. Thank you. Many thanks. Your next question comes from Brendan Carrig with Macquarie. Please go ahead. Good morning. Just on the ECEC wage increase, in terms of that fee cap at 4.4% and then with for the next twelve months, and then the funding being two years, do you have any, I guess, initial thoughts, as to what the potential fee capping could be on a go-forward basis, if that funding was to be implemented into perpetuity? Which, I mean, I assume, sensibly that it would be otherwise, the fees would obviously just need to be increased subsequently. So yeah, just any thoughts around how that might transpire would be useful. Thanks, Brendan, and good morning to you, but the real answer is no. Actually, we don't know, and that's genuinely factual. We are very much working with the federal department to get more clarity on this, and the only thing that we do know is what was published by the government, which was: they are working on a new ECEC index, which is actually quite good news. This was one of the things that the Productivity Commission highlighted, and we are pleased that the government, from that respect, has listened. If you go back historically, indexing of anything, most funding, had typically been potentially based around the CPI and the Productivity Commission, when consulted with the sector, they did take note that CPI is probably not, on its own, the best index to use. So, you know, good news, they are going to create an ECEC index, which hopefully will reflect better on our costs overall. So once we know, I think that'll be published as well. Your next question comes from Wei-Weng Chin with RBC Capital Markets. Please go ahead. Hi, guys. Just a question on agency costs, I guess. So what's the multiplier we should think about when thinking about, you know, agency staff versus non-agency staff? I guess it's more than just the headline number, I'm assuming, because of factors like superannuation and other entitlements, right? So I guess factoring all of that in, how much more expensive is agency versus staff? Yeah. So in terms of working out the bottom line impact, it is a bit more nuanced, as you suggest, Wei-Weng, because agency team also provide a little bit more flexibility, where, for example, you might have an agency team member for four hours versus replacing with a permanent team member. You have a bit more rigidity in your roster, so lose a smidge of efficiency. In terms of the rates themselves, you know, as is public knowledge, they're usually at a headline rate, potentially, say, double of an internal rate. But as you suggested, it's a bit more nuanced than that in terms of the impact on the bottom line. What we are pleased with, you can see that coming down into our employment cost as a percentage of revenue, that that 1.1 percentage points change in margin and the contribution it made, that having our agency down now, you know, in that 0.3% has made a contribution, but we also don't want to lose sight of the team has done a really good job of managing rosters, et cetera, as well, so it's not a 100% agency flow through that increment. Okay, thanks so much. Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Tom Tweedie with MA Moelis Australia. Please go ahead. ... Hi again. Look, I just wanted to ask a question about inquiry trends that you're seeing sort of so far in the first sort of six, seven weeks. You know, some of your competitors have been suggesting that the May-June lull has showed some signs of improvement in this second half to date. So just curious to see what you're seeing. Obviously, you've flagged that it's going to be down on PCP, is your anticipation, but is the trend improving or what are we expecting there? Been a little bit mixed, Tom. I think what we're saying here is certainly, you know, in that half, when we talk to the big aggregators in the market, who serve actually the majority of the large players, they have seen a year-on-year decrease. So that's factual. Going forward, do we anticipate the inquiries to be a bit lower than last year? Potentially. But, you know, in some locations a little bit different. So yes, you are right. There's been a bit of little mix, certainly in this, probably coming out of June, July time. But we remain cautious. Thank you. Your next question comes from Peter Drew with Canaccord Genuity. Please go ahead. Morning, Pejman, morning, Sharyn. Just a question on support cost. That AUD 3.5 million incentive seems to be a fairly big swing factor in the increase. And I'm just wondering, will that flow into the second half? And just, I guess if you can just give me a commentary on what we should expect for support costs in the second half, please. Sure. So stepping back, we've got an incentive program that we have had in prior year, Peter. The reason we called this out was in the prior year, we took up more of an accrual in the centers. And then as we went through the year, we rebalanced in the second half, the incentives between support office and centers. So it's not a bottom line impact that reverses. It's really, something that as we come into the second half and do our center-by-center calculations across our metrics, we then get better insights into, how much relates to centers versus support office. So no, it's not something that just reverses in the bottom line earnings, but you will see some movement in centers and support office, in the second half, once we get some more visibility. Okay. And what should we expect sort of generally, you know, in the second half versus the PCP? Should we expect growth in second half 2024 versus second half 2023 in support costs? You mean support costs? Yeah. So we will have inflation coming through, Peter, but, as we've seen in the support office headcount, you know, it's flat or a tiny bit under, so we'll keep our disciplines on headcount. There will be some increases in salary rates that came through in July, et cetera, so inflation. Okay, great. Thanks. There are no further questions at this time. I'll now hand back to Mr. Okhovat for closing remarks. Thank you. In closing, I would like to once again thank the G8 Education team for their outstanding work that has delivered these results and outcomes. Our teams every day work results in supporting thousands of families and their children with high-quality education and care. Their passion, dedication and hard work allows us to live our purpose, creating the foundation for Learning for Life. I'd like to thank you for joining us today on the call, and look forward to talking to you, very soon. Thanks, everyone. Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.