Thank you for standing by. Welcome to the PWR Holdings Limited HY23 results conference call. 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'll need to press the star key followed by the 1 on your telephone keypad. I would now like to hand the conference over to Mr. Kees Weel, Managing Director. Please go ahead. Good morning and thank you. Thank you for everybody dialing in, et cetera. W e'll move straight into it as we're basically on time. T he our first performance highlights, if you like a strong business growth, solid overall key markets. The aerospace and defense was a big mover, as we all expected. OE was 17% growth, after market, which is good to see, another 15%. Motorsports is trending on that lower side of growth, as we all knew, of 4%. On a solid conversion of revenue to NPAT. Our interim dividend of AUD 3.6 cents per share. The performance challenges and investments. I t goes without saying it's fairly common of recruitment and retention is certainly one of our challenges and inflation pressure of where it is. The increase of sale prices were good to push through where we could. Obviously raw material and wages were one of our costs moving forward. Improving our efficiency, streamlining our manufacturing process, including investment in automation where appropriate to increase revenue per headcount. Investing for the future, AUD 5.8 million invested so far of plant and equipment to support expanding production capacity. Our acquisition of Docking Engineering in the UK to provide a platform to build and grow a European manufacturing facility and capability. Customer engagement, with the borders opening up, particularly this first half, it's certainly been important to travel and one of our major costs were trade shows and trade shows and travel to be investing in those customer relationships and marketing. Investment in cybersecurity, particularly intellectual property and sensitive personal data. Investment in systems and services to bolster cybersecurity is critical, particularly when we increase our footprint into aerospace and defense. Investment in enterprise resource ERP system. We have certainly increased our existing functionality to improve our visibility and planning cost control. That's particularly new property leases increase capacity to support future growth, and that's particularly in our factory we have in another factory we have just for raw material down at Yatala and also the up-and-coming factory in the UK. Performance overview. I'll just read through the key points. I'm sure everybody else has gone through the numbers. The cash balance certainly reflects our investment in plant and equipment and the acquisition of Docking Engineering and increased raw material stocks. EBITDA and NPAT reflects growth in revenue offset by increased labor costs and insurance and the investment travel and cybersecurity and ERP, as we've mentioned before. The performance trend for the half year, I don't think we need to go over that too much. I'm sure everybody understands that's in a very positive position. Revenue by market sector. We probably go through the key points. Motorsport back to a traditional race season. Minor timing impact through to race category cost caps, which we'll talk about later on. Automotive OEM commenced of new programs including AMG ONE and the continuation of existing programs to offset the completion of the Ford GT500 program in the US in October. Automotive aftermarket improved production capacity. However, production capacity remains constrained. Further growth potential is evident. Aerospace and defense increasing in size and number of programs across the range of customers. Revenue by currency for the half year. I don't think I need to go through that. It's fairly well explained, as we all know, we do have a foreign ex-exposure, particularly for the GP and what have you. We have a lot of forward exchange program on that. The GP storage will reduce in the coming months as we continue to start manufacturing in the UK. It's really a natural offset with that. Operating expenses. Needless to say, raw materials and consumable were up a little bit. Employee costs for a bigger headcount. The wage increases and salary rates, also Australian Superannuation Guarantee from 10% to 10.5%. Occupancy expenses includes increase in land tax, waste disposal in the properties. Other expenses, investment in customer engagement and marketing, cybersecurity and ERP system development in line with our strategic goals, also increase in insurance premiums. The balance sheet. As we've always had a very strong balance sheet with strong liquidity and cash position and I don't think I need to go through every line item there. It' s very positive and I think we'll move on from that. It certainly puts us in a great position to move forward. Working capital and cash flow. We certainly had strong sales in December and that also increased our debtors compared to prior comparative period. Inventories include an extra AUD 3 million invested in raw material that had long lead times and in response to supply chain pressures. Capital expenditure for new plant equipment and the acquisition of Docking Engineering these investments were financed from operating cash flows and retained cash reserves. Liquidity position and additional cash reserves, you can see is AUD 13.1, and undrawn finance facilities of a little bit over AUD 17 million. Our business outlook, organic growth, which has always been a very positive for us. It's been very disciplined approach to selecting which opportunity to progress. Europe, the consolidated new acquisitions and expanding manufacturing from our new facility at Rugby. Aerospace & defense, continued growth in existing and new programs across a range of applications. Expanding aerospace & defense manufacturing capability in the US with the installation of also a vacuum furnace and a heat treatment furnace and also an anodizing plant to put us in a good position to take on more of the programs that are coming up in the US. Our OE programs continue to deliver on existing programs, including AMGX ONE program while negotiating for future programs in the pipeline. Automotive aftermarket, a solid market demand. We are looking to further increase our production capacity, certainly with our UK facility that will help. Motorsports continue to support all major motorsport categories as they strive to develop more efficient cooling technology as they move into the future. Business outlook, particularly for emerging technology and testing services. We are well-placed to deliver high-performance battery and electronic cooling products to the ever-expanding prestige EV market. Cold plates. The cold plate market, previously limited to automotive applications, is now spreading into adjacent markets, providing an overall larger market. Micro Matrix, opportunities continue to grow as the technology matures in current markets and also the R&D focus for aerospace & defense. Additive manufacturing. Our 3D printed parts are now included in a growing number of high-end PWR cooling systems. Testing services include the largest thermal wind tunnel in the Southern Hemisphere. Industrial CT scanning, CFD simulation modeling, Finite Element Analysis, durability, pressure testing, plus more. Pipelines for future OEM markets. I won't go through every one, but you can see it's increasing. There's a couple that have dropped off there. Particularly that when we realize that there's not enough margin and we won't continue. Although we have dropped a couple off, that doesn't mean to say we're still negotiating. The,, the unlikelihood of that program in getting up is less than 50%. The ones that we drop off are in that range. The pipelines for other, as you will see, a lot of these pipelines are for aerospace and defense. As we increase our footprint into aerospace and defense and further footprint into the US market, et cetera, these pipelines in that area will just continue to increase, and we will make sure that we are very prudent in making sure our net number is around about that 20% mark. We certainly will not be working for nothing in that area. Investing in Europe. Our new facility is to increase support for our European customers that we've secured over the last while, and we have secured a 20-year lease for a 3,500-meter manufacturing facility in the UK As we speak, we're currently relocating our UK operations into this facility, and also Dockings and BMR, Motorsport Radiators, they'll be all moving in this week as we speak. Our management team, we've moved a couple of things around over in Europe for future growth. We've appointed Wayne Rogers as Executive General Manager of PWR Europe. He's got over 20 years experience in motorsport and performance market sectors. Wayne will certainly be supported by a new level of senior people in the short term. We have Mick Cullen, our General Manager of Production in Australia over there currently. He'll be there for 2 months. We also have, which will come up further in the presentation, a secondment of a young engineer to set up our engineering department in Europe. Investing in capability and capacity. Capital investment. An ongoing target of capital investment program is critical to stay ahead of the forefront of technology developments to ensure we have sufficient capacity in anticipated and planned growth. Future CapEx focused on increased capacity, new facility fit-out and program-specific equipment. Factory footprint. We continue to assess our optional factory footprint to ensure that we plan for growth while maintaining efficiency. As I said before, the new facility in the UK was secured in December for a future 20 years. North America. We moved into our new aerospace and defense machining center in the first half, and that's up and 100% going right now. Australia, w e're discussing continuing for a new purpose-built factory ready to be moved into late 2025. New factory is expected to support the growth for the next 10-20 years. We have also secured a 1,500 meter factory 100 yards down the road from us now just for warehouse for raw material. That'll provide headspace in our new factory becoming available. Cyber security. Protecting intellectual property, customer data, sensitive personal data is critical. We are continuing to invest in the latest technology and service to secure our systems. This is important to invest as we pursue aerospace and defense programs. Just on that, the more footprint we are, and push into market in particularly aerospace and defense the more prudent it is to make sure we protect all our cybersecurity. Enterprise, t he ERP system. We are underutilizing the functions of our current ERP system and have embarked on several programs to extend our use of the ERP, improving visibility, planning and cost control. Investing in people. This is a continuous theme that most of that we recognize that our people are our core to our future business and deliver on current and future opportunities. PWR is investing in growth, headcount. We're growing our headcount and developing our skills of our people. People strategy includes investing in headcount. Growth requires ongoing investment to build in people to build headcount with focus on targeted selection and efficient upskilling. Our apprentice program currently employ a little bit over 40 apprentices across the range of trades and is continuing to expand in the apprentice program. As we increase, just a side note, as we increase our global trend, particularly in the UK for manufacturing, we're certainly starting an apprentice program in the UK as well. Graduate engineer program, w e have two graduate engineer programs where graduates rotate between engineering teams, gain valuable experience before deciding their preferred specialization. We have one- With our global engineer exchange program, we have between PWR Australia, North America, and the UK, expand our professional experience of the engineers to reinforce the PWR DNA across all operations. We have sent one senior or fairly well up in the chain engineer to the UK to set up our UK engineering facility so we're closer to our customers et cetera. We've also sent another young engineer to the US in the last six months. Work experience program, PWR runs a work experience program for high school students interested in career and advanced manufacturing in the local schools around Ormeau. Retaining our staff, r etaining field staff is crucial to achieving our growth plans. We invest in upskilling our staff to and to strive to provide a rewarding career path. Our staff retention strategies include STI program that has been expanded in recent years to include supervisors and key team members, providing a direct link between PWR's performance and personal reward. The career opportunities planning, w e are developing individual career plans and training pathways. Supervisor training, r egularly training for our supervisors, so they can better support their teams. Employee assistance program, i ndependent and confidential support to all our staff and their immediate families. Willie's Diner, PWR provides morning tea, lunch for all staff at PWR, and North America provides free lunch one day a week. Employees feedback, we actively seek feedback from our staff through one of the meetings and staff surveys and build this feedback to our future plans. That is the program, I guess we'll open up for any questions that anybody might have out there. Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from Alex Liu with Morgan Stanley. Please go ahead. Good morning there, Kees Weel. hope you're well. Good, Alex Liu. Yeah. You're good too? That's good. Can I just start with Motorsports, please? o bviously things are back to normal and it does sound like you had a minor impact there due to race category cost caps. Just want to see if you could just talk about that and I presume that's related to F1? Yeah, it is, Alex Liu. Yeah, obviously,, cost caps is stuff that everybody talks about and what have you. It's really just a timing thing for us. Yeah, we had four of our major F1 teams ask to have product booked out in January rather than December because their cost cap runs from calendar year and they're up against their cost cap in December. All our costs for that were in our first half, as you would know. Obviously when it gets booked out in January, the profit comes into January. It's really a timing issue. When you think about the costs that were there between those four teams, it was a little bit over AUD 2 million, which was substantial when it comes down to a number., that's probably the biggest skew that's probably unaccounted for or unmentioned correctly in our presentation. I do know tha sales and revenue and NPAT in January and February have been very, very much up there. W e'll see a big clawback in this second half. hanks for that. It's helpful. just secondly, obviously there's some cost pressures there. but you are looking to offset that through operating efficiencies and also price rises. Can you maybe talk about some of those operating efficiencies? Regarding the price rises, when are you looking to push them through and by how much, please? Most of the general aftermarket price rise went through at 5% in September. The main price rise for the higher end race categories and particularly F1 and the likes, is more coming into line and products being sold in the, from January onwards as the start of their season. Y ou'll see a certainly a difference in our NPAT conversion in the second half as it is always. I go back to when it was normal, if you call it a normal, of 2019 and 2020. Our first half NPAT was like in the 12%. The second half was 27%. I know it won't be that big a skew from now as it evens off a bit. There is certainly a skew there that will that'll come into play for this full year. Sorry, Kees Weel, did you say 5% in September? And what was the price rise in January? The price rise in January was more. It wasn't so much a particular percentage, but it was probably about the same, but it was obviously a bigger margin, or a bigger rev number. In particular in January with the F1 teams, as, every year that we have a price increase in that area and we keep pushing until we get pushback. It 'll be relevant in the second half. Okay, thanks. Just finally from me, Kees Weel, just on margins please? Y ou had quite a negative product sales mix, especially in the US Just wonder if you could talk about that? Also, are you still comfortable with that 20% NPAT margin target longer term? The US has always been a little bit down there on margin, and we're working very hard to lift that and lift that culture on that margin. O ur big opportunities have always been, as we've said in the US is the aftermarket program, and I'll be honest, we've been disappointed so far of how that's been how it's been going along. We've put a lot of effort into, a lot of cost into our first six months of upping that, particularly with salespeople, et cetera, to push that aftermarket program and also with fabricators and welders on that side. We I think we'll see, particularly in this next six months and beyond, a fairly good increase in our productivity in America. What was the other part of your question? Yeah, 20%. Oh, the twenty- NPAT target longer term. Yeah. Look, I know we probably spoiled the market last year by a 21 and what have you. W e're still very bullish about the 20%. Are we going to get 20%? I certainly think it'll be in the nine eights, if not high nine eights. Certainly not a 17 or a 16, that is for sure. We're still very bullish about that. It's on our mind every day of making sure that we're not working for nothing. Okay. Thanks a lot, Kees Weel. Thanks, Alex. The next question comes from Tim Parker with UBS. Please go ahead. Morning, Kees Weel. Morning, Tim Parker. Hello. Thanks for taking the questions. I'm just curious on the second pipeline slide, just scanning your eyes down the page there, that's certainly got a lot heavier weighting towards aerospace and defense now, probably a bit less in terms of motorsport than MX and that kind of thing. T hat pipeline's obviously growing really strongly. Is it fair to say some of these programs in aerospace and defense are getting larger and larger that you're sort of working on? The fact that motorsports isn't as prominent, is that just 'cause it's got crowded off the slide? Or is that sort of not as focal as aerospace and defense now? You wanna answer? Tim parker ju st on the pipelines, Martin here. We were running out of space. For the motorsports, we've decided to group them into, I suppose, categories of customer programs, rather than call them out as separate, line items for each one. Otherwise, we'd be running over to a second page. It's not wanting to, It's just the motorsport's actually increasing. We thought it was appropriate to show and reflect the increasing pipeline within aerospace and defense. J ust group the motorsports into different categories or programs with multiple customers. Got it. Just on sort of the size of some of these aerospace and defense contracts that are appearing on the slide there, in terms of size and scope, is that growing? Yeah, it is, Tim Parker. It's probably a little bit early to call out, and obviously we won't call anything out unless,, we have a signed document. There are some programs that are very hot at foot and you'll see some announcements over this next three or four months, b ecause they are sizable and we will have to announce them. When that occurs, we'll let the market know. We have quite a lot of, as you can see by the pipeline, we have quite a lot of opportunities there. We just, as I said before, we just want to make sure that we get involved with the right ones and that give us our best margins. Yeah. Got it. Thanks. Just on the slide before, just maybe a clarification on that 500,000 vehicle program that previously had appeared. Is that a timing issue in that the OEM has pushed out production on that? Or is this in terms of you're negotiating a reasonable margin out of that kind of contract? A little bit of both. They have pushed it back 12 months. They have pushed it back 12 months. It's probably one of our slimmer margins that we've looked at and been involved in. That's why we've dropped it off the page. We continue to try to negotiate a better price. We're not out of the job, but we're not putting our hand up that we want to do it for that margin. We have done quite a bit of R&D on that program, which we're being paid for, which is fantastic. When it comes down to a price going for the program moving forward as production price, we felt there was other and bigger opportunities available to give us a better margin. It's just being smart. We've got a certain amount of capability and capacity, which we're building over, between now and 2025 and 2026, and we wanna make sure that capacity is filled up with the right programs. Okay. Thanks. Can I just clarify your answer to a previous question there, just around the margin, talking to 19%. Sorry, were you referring to longer term or FY23 when you're talking about that figure? The current year. I'm talking about now. Got it. I think longer term we'll still be in the twenties. We'll certainly certainly get some tailwinds out of what we're doing in the UK. We're very aggressive over there, and when we release that to the market as a production facility moving forward, I t'll be very well received. Also, we're very bullish on our capacity and capability out of that out of that factory. Okay. Thanks. In terms of one H, two H seasonality for revenue, you suggested maybe not quite as strong this year. Are you comfortable where things are at in terms of seasonality? No, we're still very comfortable with that. As I said, we'll certainly get some tailwinds out of particularly in April, May and June, out of Europe, out of our new facility in Europe. That will certainly trend positively into the following year as well. We're very aggressive with our ramp up over there and everybody that's on board is signed up to a fairly aggressive platform on capability and also output of our daily and monthly output over there. Got it. I might just squeeze in one more if I can. Just on headcount, Nicole. In terms of labor availability and how you're going hiring, I think you ended at 485 in headcount as at December. Was that sort of ahead, behind where you kind of were planning to be? Then how's that hiring situation sort of progressed over the last few months? We'd obviously a little bit behind where we'd like to be, but I think that,, the market is turning on that. Certainly the market is turning and whereas the last 12 months we've been fairly aggressive in trying to train people and what have you. which is difficult in any market because we're getting a lot of demand for product. we have taken a long term, longer term approach that we're certainly started to not so much employ, but we invest in more experienced people, although they cost a little bit more. As we all say, you can't buy experience. We felt there was a positive line there to look at more senior people and rather than trying to aggressively train younger people with probably a little bit of difficulty there. We'd rather employ, as we all know, someone with a mortgage, with a wife and 2 kids, rather than a single guy that jumps from job to job. It's more investing rather than employing people at the moment. Great. Thanks. I'll leave it there. Thank you. Okay. The next question comes from Chris Savage with Bell Potter. Please go ahead. Thank you. Morning, Kees Weel. Morning, Martin McIver. Morning. I'm guessing it's another beautiful day up there on the Gold Coast. Actually is, mate. Yes, it is n ice one. Hey, most of the questions I wanted to ask have already been asked. I might just add one more. Any update on the Land 400, given that was being publicized and front and center six months ago? Oh, I thought you'd forgotten about that. We certainly have. Not really. No. The Land 400 program, I did see a clip on... I just got back from overseas the weekend, but so I've had a few late nights and early mornings trying to adjust back into a sleeping pattern. I did see a clip the other day of the Defense Minister holding a book of their future programs. I think that the Defense Minister has that. I guess when that comes out, who knows? Probably when they want some votes. W e have not heard any more about that. What I will say, Chris Savage, and I think I've said it to you before, there is other programs. Yeah, as much as we do want this program, let me tell you, because it's on our doorstep, but there is other programs probably 10 times the size of that, particularly in the US, that we're very involved in the early stages. E verybody that's probably on the call and beyond, sick to death of hearing the Land 400 program and the excuses that the government are giving, et cetera. A s soon as we know, everybody else will know. Even if the government released to a individual contractor, as in Hanwha and or Rheinmetall, who are the two people that are heading to build that program, I think it'd be at least six months until we know exactly what the revenue number would be in our facility for that program. We're on both vehicles that they've presented to the government. I t's a very high chance that we would get that program. W e're in very good stead for that. You never got it until it's as we say, money in the bank. Sure. Thanks for that. Maybe just a quick one for Martin McIver, CapEx in the first half jumped up to AUD 5.7 or thereabout. Is it similar in the second half or a bit lower, should we expect? It's probably going to level out around that 10-11 for the full year, because we've got certain equipment, the furnaces, for example, that we've got part payments completed that will be finalized in the second half of the year. I would expect it to be at or maybe slightly less. Is that the new level going forward, or is this going to be just a bit of a blip this year? Around 10 is probably, broadly speaking, the a normal. Thanks very much. Cheers. Yep. No worries. Thank you. Thanks, Martin McIver. Your next question comes from Lachlan Shaw with CLSA. Please go ahead. Hello, Kees Weel and Martin McIver. Thanks for the questions. No worries. Just a couple from me. W e've already sort of talked a little bit about the first half, sort of second half split, but maybe asking more explicitly if I'm sort of looking at consensus for the full year NPAT, sort of sitting around AUD 23 million. Is that a number you guys are still comfortable at hitting for the full year? Or would that some of those, I guess, delays sort of push some of that revenue into 2024? Some of the delays will push a little bit of revenue into 2024 our I think as we've said before, our NPAT to be around about that AUD 19-AUD 20 mark, I think we're still very bullish on hitting that number, that's for sure. Obviously we spoiled the market last year of having AUD 21 which has been reflected. M oving forward, we're always have that 20% number in all our numbers that we do. Obviously there are some costs this year and we're building for the future and that'll be relevant of what we do and I think the market knows that everything that we say we do and more, so I don't think there'll be any surprises out there. Maybe just on the cost base as well. We noted earlier in the call that there was some costs and some earnings in terms of timing with Motorsports. Were there any sort of other group level costs that may have been coming through in the first half that won't be expected in the second half? Yeah, yeah. Is that cost growth expected to continue? Yeah, I'll let Martin McIver answer that. He's got some numbers here I'll talk to you about. No worries. We saw the called out the investment in customer relationships, and that's trade show, travel, marketing, online store and so forth. We put a big push into that. Year-over-year that is a big jump. And that's in the order of sort of a half million dollars, but that's comparing a year that the corresponding prior year first half was quite restricted and still just coming out of a lot of restrictions. It's just getting it back to probably a more normal level, albeit w e probably have invested a little bit heavier just to reconnect with a number of our customers. That, that is likely to settle back a little bit lower than it has been the first half. Other costs, the ERP investment and the cybersecurity investment, there'll be ongoing investments there. We'll do our best to obviously manage and control those costs. With regard to the ERP, it's certainly a lot less, as Kees Weel mentioned previously, a lot less than embarking on a brand new ERP. We'll get certainly benefits and efficiencies out of that investment. Noted. Maybe just one on accreditation in the defense space. Are you guys still waiting on accreditation to come through for the Defense Industry Security Program for Australia and the National Institute of Standards and Technology for US? Are those programs that are in the pipeline dependent on receiving that accreditation? No, we have, we have all the excuse me, we have all the accreditations in place for both sites. We certainly have the NADCAP and also the AS9100 certification in place here in Australia and also in the US Amongst a whole lot of other accreditations. They're the two highest ones that are required for particularly further aerospace, particularly aerospace programs. Those other accreditations, are they still outstanding? Are you guys still pursuing those? We haven't got any outstanding accreditations that we need at this stage. No, we're very up to date. Excellent. Maybe just one final one, I guess on a long-term basis. There's a lot of manufacturing capacity to come online in UK and later on in Australia. If we're sort of looking at that FY 2025 manufacturing capacity, what would be, B roadly, the revenue capacity, given the increase in productivity in those spaces. Is there any ballpark figure? I t's probably a little bit early to call that with respect. It's probably a little bit early to call that, but we're certainly building our new facility with with further growth for the next 10-20 years. W e're going to be investing in quite a lot of quite a lot of land and property as in leasing. W e'll also be investing in some future automation programs for our CapEx area. A lot of these programs coming up in some of the EV market moving into 2025/2026, which we're heavily involved in currently. They they will require some automation. That's not tens of millions, that's for sure. It's would be certainly AUD 5 million-AUD 6 million, that's for sure in that area. That's sort of the ballpark on that. As far as revenue numbers at this stage, it's probably a bit early to call to the market until we have signed agreements. I t's, we won't be releasing any of that until we have signed agreements with our customers. No problem. Thought I'd have a crack anyway. Thanks, guys, and all the best with the rest of the financial year. Thank you. Your next question comes from Sarah Shaw with Moelis Australia. Please go ahead. Morning, guys. Morning, Sarah Shaw. First question, just on. Morning. On aerospace and defense. We've touched on it. The pipeline looks really good. It's growing. You're progressing the opportunities. I guess as a bit of a lead indicator, can you maybe give us some color around, I guess, how the level of interest from those aerospace and defense customers have changed or increased relative to, say, 6 months ago? Noting that clearly you've added a board member that's got really good background in defense. Just wondering if that's led to a step change in the interest levels. I think it will. The new board member, it was his first board meeting yesterday. That was certainly he brought a lot of internal knowledge and what have you to the board meeting, yet to really come to fruition, obviously. As far as the revenue streams coming and future revenue stream coming aerospace defense, there is some, there's some other lines of revenue streams that'll be coming in. Sorry, I can't call that at the moment. It is substantial, so that will be released when that comes to fruition, I would say probably in the next three months. The good part about that is it's more in the 3D printing area of our business, and our engineering. There's an area there that won't affect too much of our production side. Certainly great revenue stream for our the 3D printing area and our engineering area. T hings are getting wider spread, which is a good thing., I think the future in aerospace is very, very buoyant. At this stage and there is certainly a large intent for some of these aircraft to be made in Australia. I'm sure that's going to come out in the media in the next little while. Got it. Okay. Just in terms of the UK, so the manufacturing site there, can you maybe talk a bit about how they're set up and the integration's going? The other thing is obviously like labor over there is a bit of an issue. Is that something that you're thinking about that could impact the ramp up in the short term? Or it's more of a medium term thing and you've got the stuff that you need from the acquisitions now? We're very bullish in, t hat's the right word. It might be just PWR. We're very confident of getting our feet on the ground pretty quickly over there. We just moved into, just got the keys to the new facility a month ago. To set that up the PWR, if you like we've got our current production manager there from Australia, one of our guys over there, Mick Cullen, who's been with us for 20 odd years and he is helping set that up the PWR way. Confident that we will turn some good numbers over there fairly quickly., currently, like today as we speak, we're moving both BMR and also Docking Engineering into that facility. We hope to have them bedded down in the next 2 weeks to the end of February. We hope to be manufacturing a fairly substantial array of cores and units there beginning in March. But the full ramp up, we're bullish on April, May, and June, that they'll certainly give us a good tailwind with some revenue and also some NPAT on that. Great. Okay. Last question from me is just like the OEM/EV opportunity. I mean, you've called out that it continues to grow, particularly at the prestige end. per your products are expensive. I just feel there's more and more press about how the Chinese automakers are picking up share and trying to grow quite aggressively, both at the low end and the high end of the market. H ow do you see the rise of these Chinese automakers in the EV space potentially impacting, what proportion of the market your product can penetrate? Yeah, it's a good question. The market is so large, it is ridiculous. As you would know, we only need a fairly small percentage of that market to make a very good number for us. The Chinese manufacturing to some of the higher end EV market is limited for what we see., obviously we're talking about EV vehicles that are probably that AUD 400,000 upwards area. We still see that a very good place for us. It's a place where the China, I'm not rubbishing them, but the China product is not suited into that higher end mark. It's not only the product, but it's the technical advantage that we offer of people working with us. T hat's what PWR is. We're a partner, not a supplier. With all our partners that we've supplied anything that market is growing per supplier. I think that's what the positive side of our EV push is. Great. Thanks very much. Appreciate it. Thank you. Your next question comes from Cameron McDonald with Evans and Partners. Please go ahead. Oh, hi, Kees Weel. Hi, Martin McIver. Cameron McDonald, how are you? Just wondering... I'm pretty well. Pretty well, thank you. Questions from me, you're just pulling some of these numbers together. You've got a 15.5% revenue growth rate. You've called out a revenue headwind of about 3.8% in the half year. On a timing issue and,, and the costs actually went into the half year as well. If I have a look at slide 9, you've only called out a 6.5% increase in the usage of raw material and consumables. I'm just trying to close that gap,, between the 15 or even if you normalize it's closer to a 20% revenue jump versus the 6.5%. In terms of manufacturing costs. Can you break that down for me in terms of, in terms of price action, in the half versus perhaps product mix? Yeah, broadly speaking, it's product mix. Yeah, there has been some increases in raw material costs, but we've also seen some reductions in raw material costs. It broadly comes down to change in product mix, that's driving that difference. Okay. What products do you think you've, were the beneficiaries or the driver of that, please? Is it more the emerging tech sort of ramp up? Is that the way we should look at that, the AUD 2.3 versus the AUD 6.3 from last year? Yeah. It's the higher end products that we produce that require a larger labor component, is also driving that. Yeah, the more technical, advanced cooling and emerging tech where it's a lot more, I suppose, involved in the construction. Even the high-end OEM products, require a lot of labor to construct. It's the higher end products that the labor proportion is actually lower. Okay. That's awesome. Thank you very much. Good color. Thank you. 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 Roy Tolson with TeamInvest. Please go ahead. Good day, Kees Weel and Martin McIver. Martin McIver, finally good to actually hear your voice rather than just bouncing emails around. You missed the staff turnover KPI in FY22. Just wondered, and you talked about staff and what you're doing there, has turnover rate improved since the end of last year? In other words, reduced the turnover rate? Yes, it has. Yes, it has. Yeah. Good. Okay. That's about all I just wanted to know at this stage and look forward to catching up at Q&A in April. Bye for now. No worries. Thank you. Thank you. Thank you. There are no further questions at this time. I'll now hand it back to Mr. Kees Weel for closing remarks. Yeah. Thank you. Thanks very much, everybody, for participating this morning and hope you've gained some valuable insight to what we're doing and what the future of PWR is. Thank you very much, and I'm sure we will all run into one another over this next week or so. Thank you.