Thank you for joining the Megaport 2022 Full Year Investor Briefing and Q&A. We will begin with a presentation by the Megaport management team, followed by a 45-minute Q&A. During the Q&A, please click the raise hand button to be placed in the virtual queue. This feature can be found at the bottom of your Zoom interface. If you would prefer to submit a question via text, select the Q&A button to submit your typed questions. Now over to the CEO of Megaport, Vincent English. Thank you. Thank you, Kiara. Welcome everybody, and good afternoon to Megaport global update for our FY 2022 highlights. I'd like to start to take you through some of those key things. With me here today is our chief financial officer, Cassidy, and our chief marketing officer, Eric Troyer. Between the three of us, we'll be going through a section of the slides today on the presentation. To start off, just to talk high level on our revenue, AUD 109.7 million of revenue, up 40% from the previous year. Most particular about that, 49% growth in our North America business, which now accounts for 51% of our existing revenue globally for our business, at AUD 57.8 million. Our Asia Pacific business is at $33.5 million is up 30%. Our European business is up 33% at $18.4 million. Overall 40% overall growth in the business. Some other highlights to run through. Monthly recurring revenue exit and some of this information would have been available at the end of our quarter four, up 43% at $10.7 million, exit run rate. And as you all probably be aware, all of our revenue is monthly recurring revenue at this stage, so it's $128.3 million on an exit annualized revenue basis. Our customers grew by 16% to 2,643. More importantly, the total number of services, and I'll touch on this a little bit later in the presentation, grew by 26%, which has obviously contributed substantially to our overall monthly recurring revenue, up 26% at AUD 27,383. The total number of ports on the network is at 9,545 up 24%. MCRs, another key leading indicator for us in the business where we see a larger adoption of more hybrid cloud and multi-cloud up 46% at 731, and we'll talk a little bit more about that again in the presentation with when Eric goes through the stats on the industry. As I said, customers are up at 2,643. All of our key metrics have all increased, and the average revenue per port is up from AUD 974 up to AUD 1,120. More importantly, as we discussed, at this time last year, and also as we walked you through our financial year, we talked about what our network and the importance of the network and the gross margin or profit after network costs. APAC is accelerating at 79% gross margin. European business is at 71%, and North America's at 54%. This is like the exit run rate for the end of June, notwithstanding we added 14 sites, the majority of which were in the U.S. Total gross margin or network profit after direct network costs for exit run rate is 65%. We also achieved some major milestones in terms of our Japan business, notwithstanding COVID and not being able to travel to Japan for the last two and a half years is EBITDA break even, and similarly, as is our Canadian business. Overall, the group was EBITDA positive for the entire Q4. In terms of our EBITDA, APAC is running at a run rate, exit run rate at 64%, Europe at 45% and North America at 23%. Overall, for the full quarter we were EBITDA positive and overall it was at 5% and will continue to grow from here on forward. One of our key strategic metrics that we always look at is we've continued to be the market leader in having 278 cloud on-ramps. Where we are actually the largest and the market leader in terms of connecting cloud, not just through software integration and what we've done, but also physically and geographically across the globe, across 25 countries. Also similarly with 142, adding another 21 cloud regions, which is extremely important for SLAs and for cloud partners who are using our services. With that, I'm gonna hand it over to our Chief Financial Officer, Seán Cassidy, who's going to take you through the annual results for the year. Thanks, Vinny. As Vinny mentioned, revenue for the 12 months ending thirtieth of June at AUD 109.7 million, it's up 40% year-on-year. Our revenue growth is compounding. We're seeing growth in customer numbers. We're seeing growth in average ports per customer. We're seeing growth in average number of services per port. This growth behavior we're seeing across all three regions globally. APAC revenues for the year of AUD 33.5 million or 30% up from FY 2021. Growth in Europe was higher at 33%, giving revenues for the year AUD 18.4 million. As we have seen, our biggest growth market continues to be North, our North America market, which grew 49% to finish with revenues of AUD 57.8 million. North America accounted for 53% of revenues in the year. The United States is the single biggest contributor to that. The United States alone contributed to 51% of group revenues in the month of June. That fact, along with the fact that 63% of our metro footprint and half of our assets are located within the United States, a majority of our major contracts are denominated in U.S. dollar. It shows that we have become a U.S. dollar-driven company. The group functional currency has become U.S. dollar from the first of July just passed. Monthly recurring revenue, MRR, is $10.7 million, that's up 43% from the same time last year. MRR growth outstripping total revenue growth is a strong indicator of increasing momentum throughout the period. This has given us very strong momentum going into FY 2023. During our P&L, we've broken out our cost of goods sold between the two major elements because they exhibit different cost behavior. Direct network costs, which are driven by our data center and our cloud footprint, has increased $2.1 million or 8% to $29.7 million. During the year, we added 26 additional data centers to our network, and we continue to upgrade capacity within metros and between metros. Partner commissions at $11.7 million are up $3.1 million, or 36% in line with revenue growth. Partner commissions as a percentage of net revenue at 11% are in line with FY 2021. This number we'll expect to grow in future periods as we start to see momentum build in the indirect sales channel. Profit after direct network costs and partner commissions is our gross profit, and with $68.3 million for the year, that's an improvement of 62% on FY 2021. That improvement or that growth outstrips our revenue growth as our operating leverage built into our business model starts to come through. Gross margin is 62% for the year. It's eight percentage points up on FY 2021. Operating expenses, $78.5 million, an increase of 43% on FY 2021. As we invested in ourselves as part of the scale-up project that we announced last year. That investment is now complete, and you will note that our H2 operating expenses are broadly in line with H1. EBITDA losses of AUD 10.2 million are an improvement of AUD 3.1 million from FY 2021, an improvement of 23%. EBITDA margin at 9% of revenue is an improvement of eight percentage points over FY 2021. EBITDA for Q4 was positive as we're seeing the operating leverage come through to the bottom line. Direct network costs increase with increased scale in our network. We maintain good control over those costs, and our average cost per data center per month has improved year-on-year for the second year running. Employee costs at AUD 57.8 million, up 40% from FY 2021, is a consequence of us investing in growth. I will point out that employee cost is a percentage of revenue at 53% is in line with previous year. Professional fees at $5.9 million is $1.3 million, 28% up on FY 2021, as we incur costs relating to the expansion into a new market, Mexico, and the build-out of the indirect sales channel. Marketing and travel costs combined have increased $3.2 million to $4.9 million. As activity in these areas is returning to pre-pandemic levels, this is particularly noticeable in the second half of the year. IT costs and other operating costs have grown in line with business growth. Cash flow used in operations has increased $1.2 million to $9.8 million for the year, 14% increase. You will note that in Q4, we were cash generative from operating activities. That was largely because of the consequence of some seasonality in our operating cash outflows. Cash flow from investing activities at $50.2 million is an increase of $28.1 million over FY 2021. $10.4 million of that increase relates to the cash element of the InnovoEdge acquisition, which we completed in August of last year. The contingent consideration part of that acquisition cost, which is related to the achievement of certain technical and commercial milestones, is equity settled. The second set of those milestones has just been achieved. CapEx, including IP of $39.9 million in the year, has increased $17.5 million over FY 2021. This is because we have accelerated the purchase of assets to stay ahead of silicon supply chain issues. We continue to build on a nine-month horizon, and as at the thirtieth of June, we had approximately AUD 10 million in work in progress or assets under construction on our balance sheet. Cash flow from financing activities is 18% up at AUD 5.8 million in the year. Cash inflows from our 0% finance facility have increased with the accelerated purchase of CapEx, and this has compensated for reduced cash inflows from the issuance of equity. Net cash outflow for the year, AUD 54.2 million, is AUD 28.4 million more than FY 2021. This is wholly attributable to the acquisition of InnovoEdge and the accelerated purchasing of CapEx noted earlier. Our balance sheet remains strong. Notwithstanding the increase in our total debtors balance, our debtors days remains unchanged at 25 days, substantially below our standard credit terms. The total liabilities in the business include the zero percent vendor finance I talked about earlier. It also includes payments in future periods under operating leases that we've capitalized under IFRS 16. We have $82.5 million in cash on hand. We have just agreed a revolving credit facility through our banking partner for $25 million. As the company moved to EBITDA profitability in Q4, and with the operating leverage continuing to come through, we have a clear pathway to free cash flow generation. With $82.5 million cash on hand and the flexibility afforded by that revolving credit facility, we do not see that we will need to raise funds in order to get there. Finally, I'd just like to show a reminder of our operating leverage and our expansion and operating margins over the years. This graph shows consolidated revenue, consolidated gross profit, and EBITDA for the month of June for the group. Our gross margin for the group in June at 65% is very strong and has grown five percentage points over the same period last year. We still see there is a scope for additional growth in this area, and I will point to APAC, our most mature market, where now we are profitable. Where our Japan market is profitable itself. We have achieved a gross profit of 79% in the month of June. Last year, the group achieved EBITDA break-even for the month of June before we invested in ourselves. To be EBITDA positive for the full quarter in Q4 this year marks remarkable progress, and it shows the investment that we completed in ourselves in the first half of this year is now starting to deliver. You will remember this graph from the individual regions which we've posted separately. The operating margins that we've seen in a mature market such as APAC are very strong, and we've seen this pattern being exactly replicated in Europe and replicated again in North America. There's no reason for that change in behavior to be any different for the consolidated picture, which I'm showing you now, and we expect these margins to grow in future periods. With that, I'm gonna hand you over to Erik, who'll talk through a number of market elements for the business update. Thank you, Seán. As a network as a service provider, Megaport solves for a variety of networking use cases. All of those use cases are underlined by the ability to provision capacity in real-time and right-size connectivity. One of those leading use cases since the inception of Megaport has been around cloud connectivity, getting businesses connected into cloud on-ramps and into the cloud regions that are powering their business. Gartner estimates that in 2026, the worldwide spend for Cloud Connect will reach $3.8 billion. As I mentioned, Megaport is highly attuned and in line with this Cloud Connect business. In fact, nearly three-quarters of the connections on Megaport's network are connecting a business into a cloud provider. On top of that, the ability of Megaport to provide our Megaport Cloud Router service to allow customers to connect clouds directly together to enable cloud-to-cloud connections really keeps us focused within this particular space. Now, that said, there are a variety of additional things that customers do on our backbone. After all, we have built a global network that reaches 25 countries around the world. Additional connectivity's, use cases like data center to data center and even branch to data center or branch to branch, are highly aligned towards, sub-segments like IP MPLS and Ethernet WAN services in the traditional telco model. Gartner again estimates that, for the IP MPLS sub-segment, by 2026, the worldwide spend will be $29.2 billion and for Ethernet WAN, $13.9 billion. Our ability to have 787 enabled data centers on our footprint and working with over 100 data center operators, again, aligns towards supporting this type of connectivity model of getting businesses connected to the locations that are powering their architecture. Finally, with the launch of the Megaport Virtual Edge, which is our solution that allows customers to connect their branch locations with their choice of SD-WAN technology partner into our connectivity fabric, that ultimately unlocks the ability to connect branch locations into cloud, branch to branch, and branch to data center. So these are some of the principal areas where our service offering are aligning more from a, you know, traditional telecommunications standpoint. Speaking a bit more about some trends. Megaport recently facilitated a survey in conjunction with Enterprise Strategy Group, where we surveyed 300 IT leaders within the industry to glean some insights about what some of the forward-looking trends are and also get a better understanding for our own product positioning. Not surprisingly, multi-cloud continues to be a big growing trend here. In the survey, 52% of organizations said that today they use three or more cloud providers. Fast-forward to 24 months, they are projecting that 84% of them will be using three or more cloud providers. Approximately one-third of respondents will be using three or more clouds. You can see in the data there, dark blue bars represent the percentage of respondents and their cloud mix today. The light blue indicate 24 months from now. You can see a clear shift towards three, four, or five or more clouds being consumed by IT services shops. Additionally, some additional points that we gleaned are around branch as well. 66% of branch locations were identified as needing cloud connectivity. This goes beyond your traditional on-prem and data center footprint and also looks towards the need to have actual cloud connectivity delivering services into remote and branch locations. One additional stat as well here is that cloud is business critical. Respondents identified that 63% of applications going into IaaS or cloud services are deemed business critical. Many of the applications that we've seen growing over time on our network are ultimately the applications that are being relied on in business for critical applications, day-to-day operations. You know, again, that focus on the cloud connectivity piece of what we do really comes through in these stats. One final data point here. Respondents did indicate that their network budget for the coming years is actually outpacing their general IT budget. They're seeing a 5.59% increase in network investments over the next 12 years, whereas their general IT budget is seeing a 4.87%. Network is becoming more and more by the indications of the survey. We're seeing an ever-increasing part of the importance in building IT architectures here. Again, rounding back out the cloud conversation here. Cloud continues to be a major force, and our leading ecosystem of cloud providers is a clear point of differentiation for us. 77% of connections on our platform actually terminate into a cloud provider. 40% of the customers on our platform that consume cloud are actually consuming multi-cloud, so they're connecting to more than one cloud provider, many times, you know, beyond two, three cloud providers, on our platform. In fact, the number of multi-cloud providers, or rather multi-cloud customers on our platform, grew by 32% in this last fiscal year. Interestingly, half of our multi-cloud customers have adopted the Megaport Cloud Router. Just as a quick reminder, Megaport Cloud Router is a virtual router that customers use and spin up across our platform to control traffic across the Megaport platform. The predominant use case here is cloud-to-cloud connectivity. Being able to connect an AWS to a Microsoft directly across the Megaport platform provides significant value in terms of additional security, better performance across their cloud applications, and reduced operating costs and operating time frames. Megaport supporting 100 Gb interconnection into cloud on-ramp points. Now, we did increase not only the number of on-ramps that we connect into, which are effectively the doors that allow us to get into the network, on-ramps for cloud providers, but also additional cloud regions. These are kind of the super regional infrastructure nodes that provide cloud support into specific markets. A great example of new regions that we've brought on are by virtue of the fact we've expanded into Mexico. Having those localized Mexico cloud regions available for businesses in Mexico to consume services within market is all about adding value to our cloud ecosystem. As Megaport has grown over time in terms of size, scope, and capabilities, we've seen a significant growth in terms of the types of customers that are consuming Megaport. Larger multinational customers are coming to Megaport to service their multinational global IT service needs. Looking just purely here from a measure of against the Fortune list, our, you know, combination of customers and partners break down to about 20% of Fortune 100 doing business with Megaport today, 16% of Fortune 500 and 14% of Fortune 1,000. With that, I'm gonna hand it back over to Vinny to talk through some of our revenue and growth trends. Thanks, Eric. I think just that last slide, I just wanted to probably add a point to it. It adds a huge amount of credibility to our business. That mission-critical applications as we've gone through and the way that the industry is evolving and the way how important Megaport is to providing a network solution to allow customers to use those services is becoming more and more critical as time goes on. Drawing your attention to the chart on the left, you can see the dark blue bar, 9,545 ports as we're growing. More importantly, we're seeing an acceleration of the number of services that are being adopted on top of our ports and the access points on our network, which is in turn going to the chart on your right, which is driving our monthly recurring up to 10.7 on an exit run rate at the end of June. Turning to our customer Cohort trends. Again, we've been showing this chart for a few years now, for at this point in time of the year. Average services per customer up 9% at 10.4. I'll talk about the revenue in a minute, as it relates to that. If you look at the chart on the right-hand side of the scale and looking at FY 2014 as it grows up, continuing each year to add more and more services per customer at 30.6 on average. But more importantly, each year, as we go from left to right, we're adding more services per customer. And I think this is a testament to the last statistics that we just brought up, where Fortune 500 customers, Fortune 100 customers, we're seeing larger, more important global customers using Megaport's global network for its services, which in turn is driving the revenue. As we look at the average monthly revenue per customer, again, the same statistic is coming true that every trend for every year is continuing to grow. Starting on the left-hand side or the right-hand side, FY 2014 as it continues to grow year in, year out. As you start off, your first Cohort of customers in FY 2022 is continuing to increase as we add on more customers. One additional piece of information that we wanted to share with everybody today is our customer Cohort survival. Notwithstanding what I've just shown you in the last two slides is that not only are the customers continuing to grow, but our revenue per customer is continuing to grow. Notwithstanding that, and as we have some churn or as customers in each Cohort each year, you can see from the right-hand side, FY 2014 from 94%, going down to 53%. That 53% of customers from nine years ago is generating more revenue now today than it did back in FY 2014 or FY any year between. If you look at the consistency of the stats, once we get past two years of customer being with Megaport, it's extremely sticky. It adds to a lot more value for what we're doing on our continued growth in monthly recurring revenue and in our revenue base going forward. With that, I'm gonna hand you over to Seán just for to run through some more. Thanks again, Vinny. Just to reiterate a little about what Vinny was talking about there. This graph plots out RRR at June of every year and breaks out the contribution of each Cohort to that MRR. We've also plotted a few milestones on the timeline to show how network expansion and expansion of the complexity in our networks, even more importantly, is adding to the flavor and the revenue growth within that. While we've previously shown that those customers who survive grow their spend with us annually, and this is true for every Cohort and every year. What hasn't been apparent in our presentations tonight is that that growth individually in customer MRR outstrips any MRR that's lost to churn within any Cohort. That is true. What this means is that the total revenue generated by any Cohort in any year just grows. This is true for every Cohort, and it's true for every single year. For example, the FY 2014 Cohort that Vinny just name-checked, revenue generated in FY 2022 from that Cohort grew 6% from FY 2021. That is despite the survivorship within that Cohort dropping from 55% to 53%. Although 53% survivorship is still very strong after nine years. In addition, increasingly, we are selling more global solutions to global enterprises. What that means is later Cohorts are contributing more and more to the group MRR. The last five Cohorts combined account for almost 80% of our MRR at June 2022. Both these facts combined together to give the real steep increase you can see in MRR growth from this graph. As we started to grow our scale, the reduced or lower gross margins always kind of impacted any LTV calculations that we could bring out. Talking about lifetime value to customer acquisition costs. We always knew with the survivorship inherent in the customer base that this would be a strong metric for us. Our average LTV to CAC for FY 2022 at 6.3 is slightly down from FY 2021 as we invested in additional sales as we build out the indirect sales channel this year. However, the LTV to CAC for FY 2021 slightly skewed by the record number of new customers we brought on in Q4 of that year. That exaggerates the kind of drop in efficiency that we're seeing in the current year. Breaking out that figure by quarter over the last two years, you can see the trend of continuing growth in LTV to CAC over that time period is still happening over the two years. Record Q4 and FY 2021 notwithstanding. Also, even with the drop in inefficiency in Q1 of this year from the investment in additional sales, you can see that efficiency is returning throughout the rest of this financial year. Furthermore, with compound annual churn rates continuing to drop, the LTV to CAC ratios will continue to grow going forward. With that, I'm gonna hand back to Vinay who'll talk a little bit more detail about individual products. Thanks, John. With that in mind, I'd like to talk about Megaport Cloud Router now, given the fact that the market that we're in, we're seeing the adoption of more than one cloud and the growth in it. Turn our attention to the revenue per customer. A non-MCR customer or a port only customer generates around AUD 3,600 per month, compared to a AUD 6,400 customer that uses MCR. The number of services that are attached to that grows from 9.5 up to 14.9. At the end of June, we had 731 MCRs on the network. Turning to Megaport Virtual Edge or MVE, similar statistics. A port-only customer at 3.6 is now nearly four times higher at $12,000 we get per customer. Obviously the number of services that's jumps up from 9.5 up to 17.9, and we have 73 on the network. Now, it's important to point out these as we continue to layer more services on our network, some of them are highly more margin intensive because we've actually built the network and we're layering over on that, so we don't have to create extra costs in the network because we've actually got the capability or the technology to do that. The second part of it is with Megaport MVE, it is a different sales cycle. Just again to remind everybody, it does take a little bit longer to build that up, but they are higher quality, higher customers, bigger customers and bigger use cases. And then just to touch on a use case like we did last year, this one again is a global energy company that's using Megaport, roughly, averaging at AUD 100,000 a month. And it's a complexity that they're solving in the network that's not this hybrid cloud. It's again AWS and Microsoft. It's using ports, it's using VXCs, it's using MCRs, and it's using MVEs, and it's global. These are the types of customers that are using MVE. Again, just to point out that they are a little bit more complex, and they do have a longer sales cycle, but they are big, large companies that are using these type of services. Finally, just to point out, I suppose just the magnitude, 25 countries, just recently launched in April in Mexico. 145 cities, over 200,000 kilometers of network connectivity were installed in 423 data centers and enabled in 787. We are the market leader in network as a service. Okay. I'm gonna switch to just a little bit of an update on the channel. It's less financial driven, but more just an update for everybody. Draw your attention to the chart on the screen, starting from the left side to the right. Back when we started our business in FY 2013 and continue to do today as well, we have a very much a direct sales force which focuses on working with enterprise customers. I think we've illustrated that through not just our server, our survey, our customers, our base and the products that we're selling. Over time, as you will be aware, we have worked very closely with a lot of data center operators, being in 787 data centers and a lot of strategic partners in that. We've moved from more of a sell with and sell through with our data center partners for driving interconnectivity inside the data center, and more importantly, 70-something% of our connections are connecting to a cloud provider, which we've got the largest footprint for. That's been fine. Over the last 12 months, as we've said this time last year, we spent a lot of time investing into the channel or indirect selling. What does that mean? We've integrated with Cisco and other SD-WAN providers, and we're using those integrations and the value-added distributors through global system integrators, managed service providers and resellers to sell to the enterprise customer to broaden our reach and access to customers. That's the path that we have done. We're selling all of our products through that way, not just MVE. It was really important that we just kind of wanted to illustrate that, for a point of clarity for everybody. We're not slowing down on anything that we've done before. We're just expanding our reach. In terms of the Partner Vantage, and this is partners, not necessarily, not customers. On the graph, just to explain the different stage gates that we have to go through, to understand so everybody understands what the process is. We have the light blue bar down on the chart indicates where we were at the 31st of March. For example, at the 13th of June, we had 78 partners globally signed up, and 22 of them are now transacting and actually helping to sell to customers through their clients and their client base. This is the funnel that we have to work through, so that we go through each one of these stages, and that's why it's a little bit different than turning up a port in a VXC. We have to help them to sell, and that's the whole part of the program, and that's all the stages that we need to go through. Training, mentoring, and then there's coaching, and then it's looking after them going forward there, but that's when they help to sell and increase our revenue reach. Some of the logos, I won't delay too long on this, but again, these are some of the global logos that we are working on as part of that 78 customers that are signed on today that have their own client base and that are actually using Megaport for the first time as a network, as a service, as they don't have it as part of their toolbox or as part of their sales as they're selling to IT solutions and into the cloud. Okay. Just getting to the last part of the presentation here, the last slide before we go into Q&A. Just a couple of points, I want to probably just mention. I think we've demonstrated today that the operating leverage is solid and it's sound in our business. We have the right business model. We know that anywhere between 75%-78% of our revenue that we get today drops to the bottom line in terms of EBITDA, which talks to our profitability. 's talked a fair bit about our financials, but also not just our financials, but our capital management and the fact that we're capable of managing our own cash flow and are capable of making sure that we sustain that. We've got a very competitive differentiation in terms of our business. We've talked today about the industry that we're in and how highly aligned we are to cloud adoption and mission-critical usage of cloud and how Megaport can facilitate that. We're actually very focused on the innovation component of our business. We're gonna continue to roll out more products, more applications that are highly accretive to our business so that we can actually help our customers move forward over the next 10 years. With that, I probably will point out there is five or six slides in the appendix that have the regional analysis and breakdown that we've provided every other year for everybody to digest and go through, but I'm not proposing to do that, you know, today on the call. With that, Kiara, I'll hand it back to you for Q&A. Thank you. Thanks, Vincent. As a reminder, to ask a verbal question, please select the Raise Hand button. If you would prefer a typed question, please submit via the Q&A feature. Both of these options can be found at the bottom of the Zoom interface. We have a time limit of 45 minutes for Q&A, so please keep questions to the point. We'll begin with a question from Nick Harris from Morgans. Nick, please go ahead and ask your question. Thanks, guys. Fabulous to see those CAC numbers coming through. That's really obviously showing you're spending very wisely, so thank you for sharing that. Just obviously you demonstrated some pretty impressive fixed cost leverage in the business. I think looking from the first half to the second half, you added something like AUD 7.4 million of revenue and about AUD 6.5 million of gross profit. That's pretty impressive. I'm just wondering, could you give us a bit of a guide going forward or some kind of rough estimates in terms of what we should think about the fixed cost leverage going forward or the costs or whatever you're comfortable talking to? Nickolai, well, I did try to talk about how the direct network costs are very closely tied with our data center footprint and the cloud on-ramp density that we have in the network. Why we will constantly or consistently upgrade capacity in the network and there is an ongoing plan to do that's very much in line with revenue, and that should pay for itself. We've always guided that we are comfortable with this business becoming a 70% gross margin business or above, and you can certainly see that in APAC, where we hit 79% closing this financial year. I realize with the indirect sales channel starting to take off, there's always going to be a little bit of revenue giveaway, so you're going to see an increase in those partner commissions. I don't think we will ever get to the 79% on a group basis, but I'm comfortable with 70%. Thanks, Seán. Just the cost side as well, I guess if you looked at the second half, APAC and I think head office costs even went back a little bit second half 2022 versus first half 2022, so great cost control. Is that just an FX thing or could you give us an idea to run with? No, it's not an FX thing. I did say that the investment in scale off scale out that we did in the first half of the year was the build, it was the step up. I did guide at the half year that I didn't expect any additional cost to come in, or certainly not any significant additional costs to come in, except for a little bit of an annualization of those staff costs where they were hired throughout the period. As I mentioned in the presentation, there has been a reversion to pre-COVID levels of activity in terms of marketing and travel, and that seemed to be in the second half. That's going to continue. From here on in, further expansion we might see in our workforce will be revenue driven and will be there to help service our customers as our customer base grows and whether that's on a transactional basis or pure customer service. There'll be no significant step-ups in terms of OpEx from here on in. Thank you. I'll jump back in the queue and let other people ask. Thanks. Thank you. Next, we'll move along to Jonathan Atkin from RBC. Thanks very much. I wonder if you can comment qualitatively just on the sales pipeline. Is that growing? What's the velocity of decision cycles among your corporate and SMB customers, given some of the cost pressures that they're seeing? I have a couple follow-ups. Thanks. Yeah. John. Yeah. Look, we're seeing we had a good, obviously a strong quarter four coming in, and it's typically a strong one. The pipeline is strong going forward for the second half of this year. July is always a bit of a skittish month because of just vacation, Europe, everybody end of year, same summertime in the States, all of those things. It's always a slower one to start off with, but we've got a very strong pipeline. The partners that we've got on MVE, as I've just shown you in the slide, is strong, and that's helping us to supplement what we've already got in terms of our direct side of the house. We're not seeing a slowdown in terms of IT spend or network spend. You know, I think there's a lot of projects out there. There's a lot of customers out there that they are trying to transition certain things. You know, like I don't think we don't see that slowing down. Thanks. Just curious about, you know, in cases where you don't convert an opportunity to an actual win and order, what are some of the reasons for that? Is it competitive factors or is it DIY? Yeah. factors that you can kind of point to? Yeah. No, no, that's a good question. It's not, John, it's not something that we would lose based on price. We never lose anything on price. It's really gonna come down to do you wanna use the internet or do you wanna use Megaport? That's usually where it comes down to where we don't succeed, and cheap and cheerful wins, and it's a question of a trade-off or a balance between the internet security SLAs using the cloud versus using a private network to do your connectivity. Specifically on MVE, my last question is just any regions or countries where you anticipate that you might see kind of that next leg of success for that product. Thanks. Europe. Europe all day long. Europe, very much GDPR security. It's top of mind with every enterprise customer. Just being able to branch the cloud has been a big-ticket item, and the internet is not what they want to use. That's what we're seeing. We've seen a strong and that's buoyed the fact that probably if you look at the half-year results and if you look at the full-year results, in Europe, we grew 33% in the full year and a lot of that growth came in the second half of the year and predominantly it's because of security. Thanks very much. Next, we'll take a question from Tim Plumbe from UBS. Hi guys. Just two questions from me if possible, please. Firstly on the free cash flow profile, just from memory, Seán, I think at the last update you spoke about a more normalized level of CapEx going forward, partially from the reduced need to pre-purchase equipment, but also given the completion of some major programs. Can you give us a bit of a guide in terms of how we should broadly be thinking about planned CapEx for FY 2023? Given the kind of trajectory of the business, how does that tie into your thinking around free cash flow break even, please? Yeah. Hi, Tim. I did notice that the AUD 40 million that we spent this year would feel a little bit high for me, and I am sitting with about AUD 10 million kind of assets under construction on my balance sheet that hopefully I'll be able to realize at some point when we don't have to buy on a kind of a nine-month window. That to me is the indication that I'm comfortable with about AUD 30 million kind of on a go-forward basis. I've said that publicly in the past. Now whether that is all CapEx in terms of equipment or PP&E or whether it's a little bit of a swap out between our internal IP development and IEP, it's around about that level that I see that I'd be comfortable with going forward. I'm not seeing. I don't have any pressure at the minute. That's gonna see that accelerating in the current year. Got it. Sorry, just in terms of how you're thinking about that, in the context of free cash flow breakeven? I mean, I don't really want to give any guidance on that. You've seen that we've turned to EBITDA positivity or profitability in Q4. Just the way we account for things or the way we have to account for things, cash flow from operations lags EBITDA a little bit because of the IFRS 16 lease treatment of the leases under IFRS 16. As the operating leverage continues to go through, cash flow from operations will be cash generated from operations relatively shortly. The growth that we see coming is just gonna bring that down to the free cash flow a few quarters thereafter. Great. Then just this question around the reduced headcount, could you maybe provide a little bit of color in terms of where those reductions were made, how we should think about the net savings and kind of how much of that is from a capitalized cost versus the OpEx bucket, please? I'll pass you on, Tim. I'll pass you off to Vinny. He can answer that probably a little bit. Tim. Yeah. We had a little bit of a rightsizing exercise that we carried out after adding a significant amount of employees over the course of the year and two years through COVID, et cetera. It was a mix. It was across the board. Other than that, I don't really want to comment on it. Okay, great. Thanks, guys. Thank you. Next, we'll take a question from Kane Hannan from Goldman Sachs. Hey, guys. Maybe just the MVE, ARPU trends. You talk a little bit about, I suppose how that was trending in the fourth quarter. I think it came off a little bit sequentially. I suppose how I reconcile that with, you know, some of the examples you had in the deck, you know, that 100K global example that was out there. Yeah. Sorry, Kane. I didn't get the question. Sorry. Just talking about the, like, the MVE ARPU trends. I think it came down a little bit in the fourth quarter on an exit run rate. I suppose how I'd reconcile that with the, you know, the global MVE example you put in the pack that was, you know, $100,000 a month. Yeah. Look, MVE is a product that's suited to a lot of obviously branch to cloud. If you think about it's quite extensive. It can be metro, within a metro, within a city, or it can be geographically dual. Okay? We've given that example to illustrate, not necessarily with the $100,000 of value, to illustrate the use of all of our products. It's not MVE. Okay? That's MVE is only one component of that $100,000. It's all the ports, the VXCs and the MCRs and the multi-clouds being used, so it's all of our products. That's the first thing. It's not a $100,000 of MVE. I think you need to extrapolate that one. But for our, for our. for where we see MVE is going and the ARPU and the $12,000, that's the average purely on MVE only. Yeah. In terms of, you know, the customers you signed up to MVE, you know, 12 months ago, can you just talk about the sort of spending specifically on MVE that they've had across the course of the year? Well, we've only launched it. It's only a year old, so we didn't really have anything this time last year. We just launched it. There's 20-odd customers in there that you signed up sort of 4Q last year. I mean, are they just have they held static in their spending on MVE? Yeah. They're part of that AUD 12,000 just on the MVE component alone. You know what we're finding is customers are starting to add, and I think that's the same thing with the services on the cohort analysis chart that you're looking at. We see as we add these products, they're adding, actually adding more VXCs on top of it, which create more services per customer, more revenue per customer. Yeah. Just one last one, just that survival chart you put out there. Mm. Most of them like the FY 2022 one-year survival churn seemed, you know, almost the highest in the one-year record. Is there anything in that that we should be reading into, you know, sort of the macro trends or is that just, you know, small sample size, you know, going down to the 81% survival rate? No, I don't think so. No, I think we've got a lot of customers that come on and come off. The 81%, if you look at, again, I'm sorry, I'm just looking at the chart here now, but if you go from FY 2014, 94%, 86%, 86%, 86%, 90%, 84%, 82%, 85%, 81%, it's quite mixed. It really depends on how many customers are coming on for different types of projects. If you go back a slide and you look at the revenue per customer, even with that 81%, they're still spending way more money than the previous Cohort year, the year previously. So Thanks very much. It's sustainable and it's strong and that's the main thing that's coming across. Thank you. The next question we'll take is from Siraj Ahmed from Citi. Thanks. Vinny, just first question. I mean, previously you used to talk to the MVE pipeline in terms of customer numbers. I think it was around 200 or something at the half. Any update on that and whether you're really seeing any movement in the uptake of MVE? Yeah, it's continuing to grow. We've got a pipeline of around north of 300. So again, I think if you look at the stage gates that I presented today, it takes a little while for them all to come through and get qualified. It's more important. That's not customers, that's just our partners, right? So it's not just MVE. Those partners getting qualified to be able to help to sell all of our products, not just MVE, I think it's crucial. But yeah, we've got a consistent pipeline. They just take a little bit longer in terms of the sales process. Like as I said, it's a longer lead time. I think you can get an appreciation from one or two of the slides there that not only is it a higher margin product, but it is slower to get there in terms of a transaction. It not only is it higher margin, but it's also a longer sales cycle. That's the nature of the product, and it needs logistics to coordinate that between the IT managers or CTOs on the other side of businesses who are trying to put together their solutions for branch to cloud. Sure. Vinny, should we think that the conversion of the pipeline is a bit faster in FY 2023 just because I think there was a lot of pilots in FY 2022. Do we expect that to actually drop through this year or is it just a longer cycle? Just assume similar conversion ratios. Well, yeah, look, it is a longer cycle, but I would anticipate that it would improve over time, right? Particularly we have more partners selling on our behalf that we would get through and more solutions are out there and as Eric presented in his presentation earlier on, they addressed them that we're focusing on where that's at, and the space that we're in and how we're helping to address enterprise customers dealing with their IT solutions. I think that will pick up over time. If I go back to MCR, where we were two years ago, three years ago, you know, and I look at where it's going now, I can envisage a very similar pattern come from MVE, albeit with a longer sales cycle. Got it. Second thing, just maybe for Seán. In terms of cost growth, right? You've given us some color here, but if we analyze the second half cost OpEx base of AUD 40 million, that's AUD 80 million for the full year. You've reduced around 11% of headcount across both CapEx and OpEx. I get, but There's wage inflation, right? So just keen to understand how we should think about OpEx growth next year. You know, you said no big step up, but do we say flat? I mean, could it actually decline as the headcount reductions? What should we think? How should we look at it? I wouldn't guide that our OpEx is gonna decline at all. While some of the wage inflation that we have been seeing like, across the last year or so has come off a little, it hasn't come off completely, with cost of living, becoming such a factor in the U.K. and the U.S., some of that wage inflation may well come back, this year. So that will probably need to be factored. When you start looking at our half-on-half OpEx as well, you should look at the kind of travel and marketing that we did in H2 versus H1, and you will see that that's more normalized as well, and that the annualization of that will add a little. Like I say, I don't expect to see significant step up in our spend, but equally, I'm certainly not guiding that we're going backwards. Okay. We're just asking because your exit EBITDA margin is 5%, in June. Yeah. That excludes the headcount reductions, right? Your EBITDA margin is like high single digits%, right? For the first half looking forward, isn't it? I'm not gonna comment. Sure. On forward-looking numbers. All right. Okay. Just this last one on gross margins. Clearly exit run rates are better. Should we think there's some dilution? I mean, we're hearing data centers putting costs up, and also you have dilution from partners and MVEs, right? Just keen to understand how all of that shakes out in terms of gross margins. Yeah. A lot of the costs of our data centers, any kind of CPI increases tend to be contracted, and they're slightly independent of what the actual CPI is out there. We tend to be contracted at a small single-digit percentage. I haven't seen too many of the data center operators come and try and break those agreements, and they would find it very difficult. We have always tried to offset that kind of annual drumbeat or inflationary cost with the commoditization of bandwidth within or commoditization of connectivity. So I've set the challenge, and we've seen it two years in a row with the cost of operating our network on a per DC basis, or per month, per DC per month has come down two years on the trot. T hat is something we actively manage. I don't see too much pressure coming in that way from, in terms of inflation. Got it. Maybe some dilution from partners and MVE. Yeah. As I mentioned, you've seen kind of our mature markets like APAC where we do a lot more direct selling versus in Europe or in NAM where our gross margins are approaching 80%. I wouldn't go there for the group because there is a little bit of partner commission coming from that, but I'm comfortable saying that we will get to 70%. Got it. Thanks, Vinny. Thanks, Seán. Okay. Thanks. Thank you. The next question we'll take will be from Bob Chen from J.P. Morgan. Hey, Bob. Hey, afternoon guys. Sorry, I was muted just then. Just a few questions for me. I mean, we saw a pretty strong fourth quarter update where there was a lot of refocus back on to the core business. Can we talk about like how that outlook is between the direct and indirect channel into sort of Q1 and Q2 of next year? Are you expecting a bit more uplift from that indirect channel now? Yes, we are. That's, again, I go back to this time last year when we said that even though we just got to EBITDA positive for the exit run rate at the end of June, we did say and we indicated to everybody that we were gonna reinvest back into the first half of the year, which we did, on building out our channel strategy and our channel program, which we've done. You've seen from the slides today. That's on the update that we've talked about how we onboard and bring on our partners and get them educated so they can get up and help them sell. We're gonna see that funnel continue to grow. Actually the more we, you know, we've got 78 signed, and we've got 22 who are actually transacting at the moment, helping to sell, which I think is about AUD 57 thousand of monthly recurring revenue right now at the moment. That's, we expect that to continue as well as everything else in the business to continue. Yeah, short answer. Okay, great. That difference between that 78 and 22, is it just a timing thing and you'd expect the balance to come back, or start transacting? Or did you see some of those partners drop off for whatever reason? No, it's just a process. Like, it's just onboarding them. Like, as you saw in the chart there, it's one thing to sign a contract, it's another thing to get accredited, to get trained. You know, if 300-400 people in an organization, you have to educate them like the same as you would if I hired an employee to do sales today. We have to train them to know how to sell Megaport and what the value is, or the value proposition is for our products to sell to a customer. You have to do the same thing, it's just that they're indirect, right? It's an onboarding, an enablement, and an education process, as you see each one of those stage gates on the slide that we actually have to go through. That was something, as I called out in quarter three, if you recall, we said that we probably underestimated the fact—the amount of work that we had to do to put that in place. Now I'm showing you today as part of the presentation, just what are all the steps that we have to go through to make that successful. I think we're getting there. That 78 will all turn out into the. We're gonna keep adding to the 78, and they're just partners, right? Each one of those partners has, you know, 10, 20, 100 clients, so you know, depending on the country that they're in. We have to make sure we get them set up for success so they can continue to sell not just MVE, but all Megaport products. Great, loud and clear. Just on the additional disclosure around churn, I mean, it looks, you know, pretty healthy at that annualized 7% rate. Just in the first couple of years, the drop-off seems a little bit larger. I mean, what's the driver of this? Is it customers, you know, initially testing out the product and deciding a traditional network works better for them? Or what's the driver of that initial drop-off in those first couple of years? Basically nobody had a clue what cloud was, and we're trying to figure it out. If we go back to FY 2014 when we built all the connectivity out for all the global, it's only until you get past FY 2016 that you really start to see where our customers are using not just our network for, say, point-to-point connectivity, but they're actually using it for more cloud. I don't know if you remember, we used to have a slide in our presentation, which was like a spirograph, where we talked about the connectivity of, and 70-something% of our connections today are connecting to a cloud provider. That's just accelerated in from the first year or two until, you know, the last five or six. I think that's been the main driver. Instead of point-to-point connectivity, it's been more about cloud adoption. Yeah. No, sorry, Vinny. Just that one-year drop-off, 'cause that's an 81% range even in the FY 2022. I mean, like, from a promotional standpoint, do you typically give out a lot of trials at the start and then you see people dropping off? Like, what's the dynamic there? No, I don't think it's that at all. I think it's just if you go back to FY 2020, it was at 82%, it was 84% the year before. I think, you know, we just had probably a stickier cohort in FY 2021. We don't see or didn't see anything that was driving that particularly. We do a huge amount of detail. Obviously you can tell from the detail in the presentation, we go through a huge amount of detail every day about how our customers are behaving and how they're transacting and stuff. You know, anything that turns off, it usually tends to be more project-related. If someone comes on and they wanna use it for six months and they come off in the same year, because they're doing a migration or something like that. You know, that's mainly what we see as the major reason. Like, if I look back on. It's still a pretty good average for the first year. It's the sustainability of that first year going into year two and year three of that cohort is what matters. If you look at all of the cohorts going back over that, they're all extremely consistent. Great. Thanks, Vinny. Thank you. The next question we'll take is from Roger Samuel, from Jefferies. Okay. I've got two questions. First one, just on your software development cost. I noticed that you capitalized quite a lot of software development cost, AUD 14 million, in FY 2022 versus AUD 1.2 million that you expensed. I understand that there could be some one-off in FY 2022, given that you built the partner portal. Can you give us a sense of how much you will spend on software development cost in FY 2023 onwards, and what sort of ratio that you will capitalize versus expense? Yeah. Hi, Roger. I'll take that. Yeah, there was quite a lot of additional work that was going on this year as we onboarded or integrated with our secondary and tertiary and fourth and fifth SD-WAN partners, as well as the build of the partner portal and the whole PartnerVantage Hub. There was quite a lot of development that was going on this year that won't necessarily continue. I've kind of guided that I'm comfortable with about AUD 30 million as an ongoing kind of CapEx cost in total, some of which will always be kind of refurbishment or upgrade of the existing network, some of which will be expansion of the network and some of which will be this internal development of IP. A rule of thumb would be kind of one-third, one-third, one-third. When any given year, depending on what the project is, whether we're expanding kind of the MVE footprint, that year might be a little bit heavier on CapEx. Or if we're doing another development or building a more features in some of our products, you might find that the switch out is a little bit more to the IP development side. It will tend to be a switch out rather than kind of an overall increase. Okay. All right. Thanks. Just going back to the earlier question about your margins or your exit run rate for June was 5% in margin. I mean, should we sort of expect you know in some quarters that may go back to a negative level given that you may wanna reinvest in some marketing perhaps yeah. Or should we be expecting the yeah EBITDA margin to be consistently positive from this point? Well, Roger, I did say that I don't expect any significant step-ups in our OpEx, and we're starting to see the operating leverage come right the way through to the bottom line at this stage. I would like to think there's going to be growth from here, but it is dependent on growth in the top line to get there. Okay. Thank you. That's all for me. Thanks. Okay. Thanks, Roger. Next question comes from Paul Mason from Evans and Partners. Hey, Paul. Can you guys hear me? Yep. How are you? All right. Great. Yeah, good. I think I raised my hand pretty slow on the queue, so, got at the end here. I had a couple. The first one was just around, sort of the Anova Edge product and its rollout. You had a sort of a discussion point around this in the last couple of conversations we've had about having sort of a pipeline of data center provider operators and potentially other partners lined up to sort of use the product. Just wanted to get an update on sort of whether there's anything to talk to there. Yeah, we do. We've signed up our first partner who's using it, actually this month, in Canada. We do have a pipeline of three or four others that we're working through, and obviously you can appreciate it's a little bit more of a complex solution. Obviously, it's more oriented towards a service provider as opposed to an enterprise customer. We've signed up our first one and that's been onboarded or rolled out at the moment in Canada. Okay, cool. Just the second one for me was just about the network upgrading program. You guys were, I think, partway through upgrading the backbone to 100 Gig globally and in parts of the network, 400 Gig as well. How far through that are you guys now? We're about two-thirds gone or three-quarters through. Obviously the majority of it is happening in the U.S., given that's where most of our network is, and there's a couple of components of that in Australia and a couple of components in Europe. For the most part, we're about two-thirds to three-quarters, halfway between both of those points. I don't know what that percentage is, but call it 70%. We're about through that at the moment. Not only that, with the 100 Gig port connectivity to the cloud providers, we've also got a lot of those being enabled as they become available with the cloud providers. That's where somebody wants to get a direct connection into a cloud provider for 100 Gig ports. Okay. In terms of some of Seán's comments earlier today about sort of rolling down to AUD 30 million CapEx or thereabouts from AUD 40 million, is that actually like a big driver? Or is. No, it's not. Yeah, when you guys go through another upgrade, will that come back again, or it's not actually a big sort of cyclical feature? No. Look, I think the difference between AUD 30 million and the AUD 40 million has been, as Seán said in the balance sheet, that we've had AUD 10 million of hardware that we've actually had to buy ahead, make sure we weren't gonna run out, and that was for both the upgrade of the network for cloud routers that we need to continue to sell, and as you saw from the slide presentations, continuing to generate. It's a high-margin product for us and the same thing for MVE, and as well as allowing us to add more sites to the network, more from an edge perspective. I don't think that. I think 30, as Seán said, is around the right number and about, you know, that's split between, as he said, between hardware or CPE, and our capitalized IP that we do for development products and developing what we do, which in turn generates the revenue that we're seeing in the high-margin products that we're delivering. Just one on the sort of the churn disclosure. Could I just ask, you may not have this to hand, but if a customer leaves and then comes back, do they stay in their original cohort or are they treated as in sort of the new Cohort? No. No, they come back in wherever they come back in. Yeah. Okay, cool. All right. That's it for me. Thank you. Thanks, Paul. Thank you. Just a reminder, we have 15 minutes remaining of Q&A. Our next question will come from Wei Sim, from Macquarie. Hi, guys. Can you hear me? Yep. How are you? Good, thanks. I've got a question for Eric, actually, and it relates to page 14, the market drivers slide that he was showing. I was just wondering if you might be able to give us a sense as to, you know, within those different addressable markets that you spoke about with Cloud Connect, MPLS, Ethernet WAN and SD-WAN, you know, where Megaport is sitting on a market share basis. I don't think we have the statistics specifically on where we are just in terms of the penetration there. The one additional thing I would point out as well, you know, with respect to SD-WAN managed services, there's a key term in there, managed services. One thing to keep in mind is that Megaport does not do end-to-end SD-WAN management. We do provide an underlay network though, for SD-WAN services, so that when customers are looking to connect to their branch, when they're looking to spin up a SD-WAN appliance, they can certainly utilize our platform for some component of that. But just in terms of the penetration within each one of these sub-segments, we really don't have statistics on that front. Okay, that's helpful. Thank you. Maybe one more. This one's probably, I'm guessing, for Seán, but, for our North American business, those regional splits that we have at the end of the presentation pack. I was wondering if you might be able to give us any sense as to what those numbers might look like if we were to exclude KIO from North America. Obviously that has been a little bit of a dilution right at the end, but it's not just Mexico. It's not just there have been other data centers that will be brought on in Q4. As everybody remembers, our net additions in Q3 were a little bit light and that's just come on in Q4, which adds quite a lot of leverage right at the end of the year. So it's not just Mexico that does it and I don't really want to get into commercially sensitive information where people can start calculating the individual cost of a single market like that. Okay. Understood. Maybe one last final question, which is just, you know, previously we spoke about this revenue mix of having like a 70/30 direct versus channel and, you know, flipping that around. Is that still our target? That's still the target. I still think we're getting there. We have detailed in this presentation kind of all the activity that goes on to get a partner up to speed, and those are new logos that are coming through that will be revenue generative. Once they start revenue generative, that should increase as they become more familiar with reselling our products and services. Yeah, it is still the case. While the original intention was to try and get that done in about a two-year timeframe, we did say at the end of Q3 that we're probably a quarter or two behind, and that's probably about a 30-month timeframe from the beginning of this year. Okay, perfect. Thank you so much. Okay. No problem, mate. All right. Thank you. We are going to close Q&A then. Vinny, I'll hand it back to you for closing remarks. All right. Thanks very much, Kiara. Look, everybody, we will be leaving Brisbane in the next hour or so. We'll be heading down to Sydney for three days. There's a block of meetings that I've done with some of our financial partners, and then we'll also have some shareholder meetings in between as well. If anybody needs to get more questions or any more context, we'll be available for the next three days in Sydney to either jump on those calls or participate or listen in or ask more questions. Feel free to hit us up separately, and we'll do our best to get back to you over the course of the next three days. Thank you very much for joining the call, and we're looking forward to FY 2023.