Thank you for standing by, and welcome to the Tyro Payments Limited FY22 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 will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Robbie Cooke, Managing Director and CEO. Please go ahead. Thanks. Good morning and welcome to Tyro's full year results call. I'm joined by Praveenesh Pala, our CFO, who'll be presenting with me this morning, along with Giovanni Rizzo, our Head of Investor Relations. Our plan today is to focus on our published full year results for FY22 and our key accomplishments in the year. We'll also talk about some areas of ongoing focus, provide an update on our trading for July and August, and for the first time, provide full year guidance for the current financial year. Praveenesh Pala and I will spend about 30 minutes running through our results, and then we'll then take questions. We'll talk to the slide pack circulated earlier today, which is also available on our website. Just for noting, a recording of this morning's call will be posted on the investor section of our site shortly after this session to ensure those who are not able to dial in live can listen at their convenience. With the formalities out of the way, we'll get started. Before I talk about our results, I just wanted to reinforce what Tyro stands for and our position in the market. I've always been inspired by the tenacity and courage of the founding Tyro team, who back in 2003 challenged the status quo by building a truly unique Australian payments business. The impetus then was to build a payment solution that better served Australia's SMEs, and that ambition remains a core part of Tyro's DNA today. Today, we work with more than 63,000 amazing businesses. We are genuinely inspired by their success and gain immense satisfaction in assisting them to grow and thrive. This is the essence of Tyro and what drives us as a team. We're creating an integrated commerce ecosystem with payments at its core, enhanced by value-adding features and products designed to attract new merchants and retain existing ones. The majority of our customers are small and medium-sized enterprises operating in the core verticals of health, hospitality and retail. Our proprietary purpose-built solutions have been designed with those merchants' needs and preferences in mind. Turning to slide 3. Despite FY22 being a tougher year for our business, we nonetheless delivered a 10% lift in merchant numbers to now exceed 63,000 merchants trusting us with their payments needs. Of note, Tyro's core business, excluding Bendigo, grew its merchant base by 17% in the year. We increased the value of transactions we processed by 34%, reaching a record AUD 34.2 billion. Of this, our Bendigo alliance contributed AUD 5.2 billion, outperforming our original estimates when first announcing the deal in October 2020. We lifted our revenue by 37% to AUD 326 million. We increased our normalized gross profit by 24% to AUD 148.5 million. We booked an EBITDA result of AUD 10.7 million, noting that our first half EBITDA was AUD 2.8 million and our second half result was AUD 7.9 million. Reflecting on the year, our performance was dampened by continuing COVID lockdowns in New South Wales, Victoria and the ACT. This cost the group an estimated AUD 5 million in foregone EBITDA in the first half of the year. Our results also reflects the absence of the AUD 4.5 million JobKeeper benefit we received in FY21, the first time costs of the not as yet earnings accretive Medipass acquisition, and additional headcount as originally flagged to conduct the Bendigo alliance. Our second half provides a better line of sight to Tyro's performance potential without the impact of COVID and with the benefit of actions taken in the second half, including reducing headcount, controlling operating costs and lifting our merchant service fee. These actions started to positively contribute in the last quarter of the year and delivered improved operating leverage, as can be seen on slide 6 of the pack. These actions will remain a key focus in FY23 and are expected to yield further operating leverage improvements in the year. This will occur in parallel with a continuing focus on driving strong top-line growth, new to book merchant acquisition and product innovation. Prav will spend a bit more time talking through these matters and our financial results in a short moment. Turning now to slide 19 and providing some additional color around our payments operations. I think it's well understood that we operate in one of the most competitive industries globally. The payments landscape today is as competitive as it was five years ago, demonstrated by the entry of new international and domestic merchant acquirers, the establishment of new players, new investment in payment tech by the Big Four banks and new payment types emerging, such as buy now, pay later, QR code payments and BNPL. Despite this environment, Tyro has over the last five years continued to capture segment share, growing seven times the card present system growth rate. This has seen our segment share of card present payments reaching about 5% as at 30 June 2020, and our segment share for SMEs in health, hospitality and retail reaching about 19%. As I mentioned, the value of transactions processed in the year lifted 34% to AUD 34.2 billion, notwithstanding the lockdowns in the first half. The addition of the Bendigo alliance for the full year contributed about AUD 5.2 billion to this amount. Our growth was assisted by a 17% increase in merchants selecting Tyro as their payments provider, if you exclude our 17,000 Bendigo merchants. With our Bendigo merchants included, the end of the year was 62,700 active merchants on the books, to be precise. Our new health business, which incorporates Medipass, which was acquired in May 2021, added 2,263 new merchants through the year, seeing us end the year with 12,463 health merchants generating transaction value of AUD 3.3 billion. Merchants in our three core verticals, health, hospitality and retail, represented 85% of our merchant count and made up 91% of our transaction value for the year. Our strongest transaction value growth for core Tyro was delivered in our hospitality vertical, up 18%, with health also delivering an uplift of 18%, whilst our retail vertical grew 12%. Even more impressive was our hospitality vertical, which grew 31%, H1 to H2 in FY22. Our e-commerce transaction value continued to grow, generating AUD 520 million in transaction value, a lift of 6,640%. Our largest states by transaction value contribution were New South Wales at 34%, followed by Queensland and Victoria both at 23%. All states other than New South Wales and Tasmania experienced double-digit transaction value growth. Victoria and the Northern Territory were the strongest at 23% and 29% respectively. New merchant sign-ups tracked at approximately 1,200 new applications per month, with 55% of leads coming to us directly and 45% through partners and referrals. We now have 348 direct point of sale system integration, up from 322 in FY21. We entered into an exclusive partnership to provide merchant acquiring services to Telstra's business customers through over 350 Telstra retail stores and Telstra business technology centers, as well as online. This new acquisition pipeline to Tyro has performed above our expectations and will, we believe, continue to be a strong application channel going forward. Tyro Connect continues to grow with about 2.2 million transactions processed by the platform, compared with about 700,000 in FY21. With 109,000 terminals now in the field, we remain the fifth-largest merchant acquiring bank by terminal count. Brand and retention continued to be a focus for our payments operation in the year. Our prompted brand awareness is now sitting at 19%, and our customer retention rates remain very strong, with churn measured by transaction value slightly up at 9.2% compared to 8.7% for FY21. Our churn rate metric by merchant number is 10.5%, down from 11.3% in FY21. Finally, in the payment space, we launched our Tyro Go mobile card reader in May this year. This new terminal type aims to open up the trades vertical, provide the potential queue-busting solution for larger format retail, and provides a fit-for-purpose solution for micro-merchants. Turning now to slide 24 and our banking products. Although our banking operations still only represent a small part of our overall business, it presents an alternative to the major banks and has strong prospects for continued growth. Our products are focused on providing our customers with innovative ways to meet their transactional banking and unsecured lending needs. Our Tyro Bank Account is a fee-free, interest-earning transaction account. Just over 5,000 Tyro merchants were actively using the Tyro Bank Account, up from about 4,600 a year ago, with close to AUD 80 million on deposit at 30 June 2022, up from AUD 72 million a year ago. Our term deposit offering, which is available through the Tyro App, held AUD 4 million in term deposits as at 30 June 2022. Our cashflow-based unsecured loan product is designed to assist SMEs in growing their businesses. Our business loan is repaid from a merchant-selected predetermined percentage of card transaction volumes as generated by the individual business and is offered on the basis of an upfront fee. The innovative feature of this product is its repayment cycle up or down in accordance with a merchant's daily card transaction volumes. Our merchant cash advance loans returned to strong growth as we switched back to an automated loan approval process. This followed a period of manual approvals to mitigate the risks inherent due to COVID volatility. We also increased the maximum loan size from AUD 120,000 to AUD 350,000. With these benefits, we wrote close to AUD 100 million in loan originations in the year compared with AUD 26 million in FY21. Our average loan size in the year was around AUD 47,000 compared to approximately AUD 35,000 a year ago, with an average length of six months in line with last year's average. The team managed the risk within our portfolio closely over the period, with lending losses at AUD 600,000 in the year. I'll now hand over to Prav, who's gonna step us through our financial position in more detail, and then I will return to discuss our outlook. Thank you, Robbie Cooke. A very good morning to everyone on the line. If you could all please turn to page 11. The financial results was a tale of two halves, with all key metrics pleasingly improving progressively into the second half and beyond. Our strong balance sheet continued to allow us to weather the disruptions in the first half and sustain acceleration in top line growth in the second. In summary, our transaction value growth was 34%, delivering a total of AUD 34.2 billion for the year. Our group gross profit was up 24% to a record, AUD 148.5 million. We have normalized EBITDA of AUD 10.7 million, up AUD 7.9 million from an EBITDA of AUD 2.8 million in the first half. I will be talking normalized numbers generally, but I will take you through all the adjustments to the statutory accounts as well. I'd like to focus on three key takeaways as you look through our results. Firstly, a rebound in growth in the second half of the year. Increased focus on cost management, especially discretionary spend. Finally, the strength of our balance sheet, especially capital and funding, as we highlight our pathway to free cash flow. Firstly, a rebound in our growth. Both our transaction values and loan originations achieved strong growth in the year. Our full year transaction growth rate of 34% followed a very strong second half, where our growth rate increased to 38%, accelerating from 31% for the first half, which we attribute to COVID-related disruptions. We processed a total of AUD 34.2 billion for FY22, with AUD 18.4 billion of this coming through in the second half. Finance gross profit normalizing for the Bendigo profit share and switching costs, was AUD 141.5 million, up 28% from the previous financial year. The lag to the transaction value growth rate reflects a 30% commission to Bendigo, as well as a deliberate deferral in repricing from the first half to the second. The uplift from pricing came from the last quarter for FY22, and we are now back to our normal rhythm of pricing reviews. Loan origination grew to AUD 99 million for FY22. While still a relatively modest business when compared to our payments business, this was a new record for Tyro, representing a 283% increase from AUD 25.8 million in FY21. In the first half of FY22, we originated AUD 36 million, which we almost doubled in the second half, exiting the year at a rate of AUD 12 million per month. We recorded lending income of AUD 5.5 million in FY22 compared to AUD 3.2 million in FY21. The quality of the loans remained high, with a weighted average duration of just over six months, consistent with the prior year. We recognized AUD 0.6 million in loan losses for the year. As a result, our normalized gross profit grew by 24% compared to FY21. Discounting for JobKeeper income of AUD four and a half million included in the previous year, the year-over-year growth rate was 29%. The second item I'd like to draw your attention to is cost management and our approach to improving operating leverage without impacting delivery. I will go through our expenses in the next few slides, but as you can see, our operating expenses grew by 31% to AUD 137.8 million, an increase of AUD 32 million. It is important to note that FY 2022 was the first full year that included the operating costs for the Bendigo Alliance and the Medipass acquisition. These totaled AUD thirteen and a half million, and excluding these costs, the underlying expense growth was 18%, the majority of which was in employee and contractor costs. I will provide more details on this shortly. Our market opportunity remains significant, and while we would like to keep investing in revenue generating and technology-related roles, we acknowledge the need to demonstrate sustained improvement in operating leverage in the face of an uncertain external environment. As Robbie highlighted before, the best way to demonstrate our increased focus on cost management is by looking at our full year operating leverage metrics in FY22. Our fourth quarter operating leverage was 88.6%, which was significantly lower than the other three quarters of FY22, and will continue to be managed down as per our guidance. As we look into FY23, we plan to hire only roles that are critical to our strategic priorities of growing our customer base and revenue, delivery of key projects or generating efficiencies in the business. We will continue to take advantage of our access to contractors in the short term to expedite key deliverables as we have done in the last quarter. Our EBITDA was AUD 10.7 million, of which almost AUD 8 million was generated in the second half. The full year EBITDA was down from the AUD 14.2 million FY21. However, discounting for JobKeeper income of AUD 4.5 million last year, our EBITDA was up by AUD 1 million, excluding the AUD 5 million we did not generate as a result of lockdowns in the first half. For the first time, we are providing an EBITDA guidance for FY23, which is expected to be between AUD 23 million and AUD 29 million, as well as targeting positive free cash flow as we exit FY23. Non-cash items for the year included AUD 5.2 million in share-based payments expenses and AUD 20.5 million in depreciation and amortization. Share-based payments expenses were lower due to some releases from previous years, including the unvested equity following the CEO resignation in line with accounting standards. Depreciation and amortization expenses increased to AUD 20.5 million, up from AUD 14.7 million in FY21. This increase is a result of previously capitalized development costs, which are now in use and therefore being amortized, an increase in the right-of-use asset from new offices as well as other capitalizations. Our statutory net loss for the year was AUD 29.6 million compared to AUD 29.8 million in FY21, which includes AUD 11 million from the amortization of the Bendigo intangible. Moving to the next slide 12. Our margins improved in the second half compared to the first. The unit margin decrease over recent years has been due to a combination of larger merchants coming on board, as well as the usual dynamic of underlying cost changes. Unlike last year, a change in card mix did not play a significant role for FY22. As noted in our first half year results, we deferred passing an increase in direct costs to our entire merchant base, including those in cost-plus pricing, to allow them to recover from the effects of COVID-19. The price increase was completed at the beginning of the fourth quarter, with an overall increase of two basis points in margin to the entire portfolio, excluding the Bendigo merchants. You can see this benefit come through in our net margin, which was up to 33.3 basis points in the second half compared to 32.2 basis points in the first, reflecting one quarter's worth of increases. The page shows the Tyro core book excluding Bendigo to provide a like-for-like comparison. The Bendigo Alliance continues to perform in line with our estimates provided to the market. Transaction values for Bendigo were greater than our initial estimates, while gross profit margin of 37.8 basis points was just under one basis point lower, as these merchants are not subject to pricing review at this point. With conditions post-COVID now fairly back to normal, our repricing cadence has been reinstated and our next review is currently underway. Moving on to our operating cost base on slide 13. The three main areas of increases were employee and contractor costs, communications, hosting and license costs, and other administrative expenses. Excluding share-based payment expenses, permanent employee costs grew by AUD 17 million or 23% year-on-year to AUD 92.6 million. As I mentioned earlier, this is the first full year of the Bendigo and Medipass costs. Nine out of the AUD 17 million can be attributed to these acquisitions, which added a net 73 new team members. The remaining AUD 8 million are explained by salary increases and the annualization of a net increase of 57 new hires in FY22 in the Tyro core business, mainly in the technology and customer functions. These were all exclusively in the first half of the year. Our number of permanent employees peaked at 628 at March 2022, reducing to 612 as of today. Tyro's salary review cycle is on a calendar year basis, and the second half saw the impact of an average annualized salary increase of 4.3% across all teams. Our guidance includes the annualization of the pay increases that were effective 1 January 2022. As Robbie mentioned, we're very much focused on delivering certain strategic initiatives in FY23, in particular the Tyro Go card reader, the Android-based Tyro Pro, and automated customer onboarding. To balance the quality and timelines of delivery and without committing to costs into the long term, we have tapped into our various partners to source project-based contractors. As you saw earlier, the number of contractors peaked at 140 in May, and as phases of the various projects get completed, these are being rolled off, getting close to 100 as of today. Our focus on operating leverage allows us to assess and pivot our spend quickly relative to top line income. Overall, our contractor and consulting expenses were AUD 13.8 million, up from AUD 7.2 million in FY21. In addition, AUD 7 million were capitalized in the financial year, giving you a view of our total cash spend. Communication, hosting and licensing costs increased by AUD 4.4 million year-on-year. These were largely growth related as we continue to roll out terminals for the Bendigo customer base and progressively increase their transactions processed on Tyro Switch. Licensing costs increased as we invested in our CRM system as well as general headcount growth related license costs compared to the prior year. Additionally, we invest in cybersecurity, open banking, and tools to make our project delivery more efficient. We will continue to assess build, buy or license decisions based on what will deliver the greatest return on investment for our shareholders over the long term. Finally, administrative costs increased by AUD 4.2 million, including approximately AUD 2 million in recruiting key roles, including relocation costs. Terminal management and logistics costs increased in line with greater merchant base. Training, travel, and entertainment activity, which were paused for much of the prior year, resumed during FY22. I would consider a significant portion of these costs to be discretionary and expect to reduce as per our guidance provided. On the right, you can see the buildup of our costs with the quarter four operating expense run rate expected to be maintained for FY23. Turning briefly over to slide 14. We have clearly laid out the normalization adjustments that allow you to see the true operating position of the group. I do think this is a really important reference slide given the statutory accounting treatment of our Bendigo Alliance. The accounting treatment puts significant costs below the line, as well as substantial intangible assets and liabilities up front on our balance sheet. On a statutory basis, the accounts do not recognize the gross profit share, but instead an amortization of intangible. We therefore normalize for this by deducting the commission from the statutory gross profit to provide the commercial reality of the transaction. This will be one adjustment that you will always need to make to the statutory accounts. The remaining adjustments are temporary costs we incur in the period while the Bendigo merchants are being onboarded to Tyro. Once the rollout is complete, which we expect to be in the coming financial year, these costs will recede. I'll leave you at this stage, and I'll be happy to take any questions on these adjustments later. The final takeaway is the strength of our balance sheet, in particular, our liquidity and capital positions. At 30 June 2022, we had total cash and investments of AUD 122.8 million on the balance sheet, down from AUD 172.8 million in FY21. As an unrestricted ADI, Tyro is able to raise deposits as a stable and competitive source of funding. Our liquidity ratios remain well ahead of the internal requirements, with adequate liquidity to fund our strategy and allow us to exit FY23 generating positive free cash flow. The reduction of AUD 49.5 million in liquidity is explained largely by the growth in our loan book, as well as capital expenditure within the year. In particular, our CapEx was AUD 33.5 million, which included AUD 14 million on terminals, circa AUD 10 million on the fit-out of our new offices, and around AUD 7 million in internally generated intangibles. Our banking outflows were a net AUD 16 million as the loan book grew by around AUD 24 million, offset by inflows from deposits of circa AUD 8 million. We paid around AUD 5 million in remediation payments and AUD 4.7 million in Bendigo transition fees. These outflows were offset by AUD 10.7 million generated from positive EBITDA and minor movement in working capital. Our capital position remains strong with a capital ratio of 39%, which is multiples above our regulatory capital requirement. This trend has allowed us to pursue both organic growth as well as inorganic growth with the Bendigo alliance and the Medipass acquisition last year. The deceleration movement from 73% last year to 39% this year is due to a combination of AUD 70 million increase in risk-weighted assets and a decline of AUD 12 million in regulatory capital. To provide more detail, the AUD 70 million increase in risk-weighted assets is primarily made up of an upfront recognized right-of-use asset, as well as fit-outs relating to our offices at 55 Market Street, totaling AUD 41 million. An increase in our loan balance, which grew to AUD 39.5 million, up from AUD 15.4 million in FY21, a growth of AUD 24 million. An increase in fixed assets, including terminal as well as other working capital movements. The decline in total capital is our net statutory loss of AUD 29.6 million, less share-based payment expenses, losses from associates, and the unwind of the Bendigo and other intangibles, giving us a regulatory net loss of AUD 12 million. The intangibles and investment in associates are already deducted from capital upfront and therefore will be neutral or positive to capital going forward. Other than the growth in our loans book, which we will continue to utilize our capital for, majority of the capital reductions have come from significant acquisitions and one-offs in the last two years. We incurred AUD 33.5 million in capital expenditure, which is slightly below the forecast we provided of AUD 34 million. We're expecting to incur another AUD 35 million in FY23 as we finalize the Bendigo rollout, fund our organic growth with our configuration and purchase of Tyro Pro terminal and Tyro Go readers, as well as deliver automated onboarding. We look forward to delivering these in FY23. That is a summary of the financials for FY22. Recapping the key messages, we saw a rebound in growth in the second half of the year in both our payments and banking businesses and continue to expect solid performance in FY23. We continue to focus on cost management and demonstrating meaningful improvements in operating leverage, and we have strong capital and funding to deliver our strategy and target to exit FY23 generating positive free cash flow. We have, for the first time, provided our guidance on key metrics for FY23, and I will pass back to Robbie to provide both the trading update and earnings guidance. Thanks, Prav. We've had a very strong start to FY23. Our transaction values for the year to the 26th of August are up 57%, sitting at AUD 6.3 billion, with the strongest growth coming through New South Wales, up 118%, and Victoria up 70%. Bendigo transaction values were up 8% for July. That all translates through to a normalized gross profit from our payments business for July after Bendigo commissions, up 46% sitting at AUD 14.1 million. Loan originations to the 28th of August, we're sitting at AUD 20 million. That's up 91% on the same period last year. As Prav mentioned, for the first time, we're providing earnings guidance for FY23, and the following guidance bands are provided. First up, transaction value being between AUD 40 billion and AUD 42 billion for FY23. Gross profit after Bendigo commission between AUD 175 million and AUD 181 million. We're targeting an operating leverage position of circa 85%. An EBITDA result between AUD 23 million and AUD 29 million. As Prav mentioned, the business is targeting being free cash flow positive on exiting FY23. As we've stated, actions taken in the second half of FY22, including reducing headcount, controlling operating costs, and margin management, will remain a key focus for the business for the balance of FY23 to drive our operating leverage position. This will, however, occur in parallel with a continuing focus on driving strong top-line growth, new-to-book merchant acquisition, and product innovation. To that end, some of the key priorities for us in the year are a continued focus on the needs of Australian SMEs with our differentiated offering, leveraging our proprietary tech. Increasing our focus on the health vertical, combining many parts in our existing health business to create a class-leading health payments and claiming business in Australia. Refining our approach to servicing micro merchants. As Prav mentioned, automated merchant onboarding and servicing. Launching new payment devices, including the Tyro Go Reader and our new Android-based Tyro Pro terminal. Targeting the trade services and accommodation verticals with industry-relevant features and products. Expanding our merchant acquisition footprint through new partnerships and alliances. Providing a unified commerce offering to merchants, including card present and e-commerce payments, banking and data insights. Expanding our portfolio of banking products and leveraging our valuable banking license. That ends the formal presentation, and we'll move on to Q&A. Ladies and gentlemen, this is the conference operator. We have temporarily lost connection with the speaker line. Please continue to hold and the conference will recommence shortly. Pardon me. Now we're reconnected. Please go ahead. Hello. It's Tyro back on the line. I'm not sure if we got to the end of the presentation or not, but we're happy to take Q&A or if people missed anything, we're happy to circle back on any of the presentation. Sorry, can we please go into Q&A now? 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 Bob Chen from J.P. Morgan. Please go ahead. Good morning, guys. Just a few questions from me. Just looking at the trading update for July, it looks like you've delivered AUD 2.2 million of EBITDA for that month. Looking at your guidance for the full year, it seems to assume that that's sort of the run rate for the next 12 months. Like, how should I think about that, given that, you know, there's a bit more of a focus on the OpEx line in your business as well? Yeah, thanks, Bob. It's Prav here. So look, broadly speaking, yes, that can be assumed as the run rate. In coming up with our guidance, there's a couple of things we've assumed. We've assumed that we'll continue working in our cost base, especially the discretionary spend. A lot of that we have already started in the fourth quarter. As we exited into July, you can already see the results of that coming through. From a margin perspective, we have assumed a static margin effectively, which gives us allowance to onboard larger merchants as well, allowances in case of significant increases in international transaction value. And we've held a steady state from the second half on our loan originations. Obviously, the one expense item that you factor in again, is our salary review cycle, which we're set to meet on the first of January 2023. Okay, great. Then just in terms of that cost base, I mean, there's obviously quite a lot being invested. Like, are you able to break out, you know, what's being invested for, you know, true growth in the business versus what's sort of the ongoing just maintenance OpEx? Then, you know, how much of that OpEx is also allocated to the banking part of the business as well? Yeah. We haven't broken it based on banking and payment. I think the best way to look at what's project related would be our contracted base. We actually accelerated investment into that, especially for three key deliverables that are expected to come out in FY23. As we complete each phase of those are being rolled up. You can actually see that coming down. Like I mentioned, we'd be very, very keen to be investing in our revenue generating and our technology functions. But at this point in time we're keeping a steady state. Okay, sure. No worries. Then just finally, just on competition. I think you've got a slide in there on page 28. Just that looks at the different growth between the other four major banks, yourself and some of the other non-bank members as well. Can you talk a little bit about, you know, how come NAB's sort of starting to grow a little bit quicker, and you guys seem to be slowing down a little? There's also that other category out there that's growing pretty quickly. Like, what's happening across just the whole competitive environment? Yeah. Bob and Rob, Robbie here on that one. Look, the terminal growth numbers, little bit of caution on our 109,000 increase. What we've found as we're rolling the Bendigo fleet out and replacing it with ours, a lot of those Bendigo merchants had multiple terminals and actually now aren't requiring three. They might require one instead of the three they had. There's a bit of a efficiency gain there, I suppose, in terms of that terminal spread required for the Bendigo merchants. Can't tell you what's going on in that book. In terms of the other, the non-AusPayNet stack, I mean, that's got a multitude of different players in there. It's got Fiserv, it's got Bank of Queensland. Again, it's a combination of various players, and it's terminal numbers, not necessarily transaction value. I think I'd just exercise a little bit of caution around some of those numbers. You know, a transaction value for us is the most relevant stat, but we've always put that terminal count just to give an idea of what our actual land-based terminals look like versus the pack. Okay, great. I mean, just in terms of that competition, are you seeing more pricing competition or, maybe capability or tech-based competition that's happening in the market? Look, it's the dynamic in the market really hasn't changed. I mean, we've always had, you know, from time to time, some players go, you know, do some price competition, which is fine. It's a mature market. We, you know, we have a very good view of what the pricing portfolio looks like across the SME landscape by vertical and by size. We price where we can see a profitable outcome. We won't chase volume and do it on a loss basis. We've got some very strict discipline in the way we price. Look, there's competition from time to time on pricing. There's competition on feature set. We're very comfortable that we, you know, we've got in the bag a very strong offer. We've got, you know, features out there. For example, our surcharging feature, you know, is something a lot of our merchants use, and it's very attractive and easy to implement. We've obviously now got our new reader, the Tyro Go device, which gives us an opportunity in that micro space we've never played in before. We're, you know, very excited about having a Tyro Pro device out in the market. You know, our focus with Tyro Pro, which is different to how others have introduced Android terminals. Similarly to how we've rolled out the Yoximo and Yomani terminals, where we control the features because we own the tech sitting on the terminal. We're taking the exact same approach with the Ingenico AXIUM DX8000 device, building the actual payments app that sits on that terminal rather than taking an off-the-shelf solution. Which minimizes your opportunity to actually do specific or customized features for verticals, which is where we compete very strongly. We're maintaining that approach, which gives us more competitive leverage in the market by having the ability to build specific solutions for particular verticals. Great. Thanks, Robbie. Thank you. Your next question comes from Tim Piper from UBS. Please go ahead. Good morning, Robbie and Prav. Thanks for taking the questions. Just quickly, just on the follow-up on the 1Q23 update and also what you're seeing on the acquiring fee margin side. If I sort of break it down, obviously, one agent solution is a bit of a step up there, and it's been offset by your pricing that's come through. Is it right to back out for the first quarter, taking your trading, you did sort of almost AUD 3.4 billion for the month of July at 14.1%? That's sort of 41.5% of the GP margin line for payments. It's kind of stepped back a little bit from The second half, is that just the increase in acquiring fees that are flowing through into the 1H 2023 period so far? Yeah, sorry, Tim Piper, I didn't quite clearly get the back calc you were. If you don't mind just repeating that, please. Sorry, Tim, can you hear us? Sorry. July GP was AUD 14.1 million, and then your payments as per the trading update is AUD 3.387 billion. That's sort of 41.5 basis points. Right. Just thinking, like, looking at the chart that you always provide around, it was sort of 42.4% in the payments GP in the second half. Is that? Am I interpreting it correctly, it's kind of stepped back down a bit in July? No. The 42.4% is the core Tyro Payments margin. The group margin, if you actually look at from our particular accounts, that will be about 41%. The reason for that is a significant portion, Bendigo becomes a significant portion of our total transaction value, and that has a 30% commission payment out to it. When we say a total payment margin for July, that will include the Bendigo book as well. Oh, okay. It's basically in line with 2H '22 run rate then, July so far. It's slightly better. It's in line with the last quarter of FY22. Yeah, okay. No problem. Sorry. Got it. Could we just step through your CapEx for 2023 in a little bit more detail, if possible? Obviously you're going into AUD 35 million. There was sort of AUD 10 million office fit out in 2022, which I assume is not there. The software and capitalization development work cost was AUD 7 million. Just, do we sort of assume that seven million grows roughly in line with the OpEx, or are we sort of expecting a more significant step up in that seven million in CapEx in 2023? We're probably expecting a slight pickup for FY23. That AUD 35 million CapEx is made up of roughly about AUD 21 million in terminals, which will also conclude our Bendigo rollout. It would also include development work that we're completing on our Tyro Go terminals and our Tyro Pro terminals, as well as the purchase of the Tyro Go and the Tyro Pro. In terms of the actual intangibles that we capitalize, like I said, in the last quarter especially, which will flow into the next year, we will be delivering those three key projects. We are looking to step that up slightly, not huge. I mean, overall, our AUD 7 million capitalization is fairly low. We're probably looking at between 10 and 12 next year. Oh, okay. Terminals is going from 14 to 21 in FY23. Did I get that correctly? That is correct. That is the cash. Because some of that is that timing difference that comes from between June and July as well. Yeah, got it. Just sorry, two more quick ones. Can you give us a sense on the contribution of Medipass now, sort of at the year that's aligned at all? Not Medipass itself. We look at it as more a Tyro Health business unit. From just Medipass at this point, not a material contribution to the accounts. Okay, got it. Thanks. Just a final one, just pulling out or stripping out the Bendigo numbers and just looking at core Tyro. Just in the second half, just interested in your take on what sort of you're seeing out there in the merchant base. If we kind of look at transaction value per merchant, it's obviously stepped up strongly in the second half as we sort of, you know, come out of lockdowns and all the rest of it. Doesn't look to be quite back at sort of a peak. In terms of that, do you think there's still constraint out there, or is this more of a business mix? I mean, I know you guys are sort of targeting to move up into larger merchants as well. Is there any sort of context you can give in terms of the spend per merchant you're seeing going through, the terminal, the Tyro terminal base at the moment? Nothing definitive. I mean, you're definitely right in the conclusion that it increased in the second half because of the disruptions compared to the first half. I mean, there's two things which we're following closely. Don't have an answer for that yet. Is just the change in the inflation rate. Obviously, as the prices go up, we feel that more transaction value goes through the terminals. At the same time, as inflation and interest rates also go up, the discretionary spend is assumed that consumers will be spending a bit less. It is something we're following quite closely. It is one that we don't have an answer to at this point. Obviously, international is beginning to come back. It's kind of plateaued at about 1.7%, as you see on the chart in the investor presentation. As that obviously increases, the average transaction value should go up theoretically. But look, nothing definitively. Hello. Ken, the only thing I'd add to that probably is in relation to Victoria, while it grew well for the first, you know, first part of the FY23 period, it's still, you know, it's only growing 70%. I think Victoria still has some challenges, and I think we haven't seen a full bounce back on our Victorian merchant base, generally speaking. Okay, great. Thanks. I'll jump back in the queue. Thank you. Your next question comes from Brendan Carrig from Macquarie. Please go ahead. Good morning, everyone. Just a couple of questions from me. Can we just maybe start on the merchant application? I think if I'm calculating correctly, it was roughly a 50-50 split of about 7,400 new merchant applications in each half. Can you just talk to the mix of those merchant applications in the second half? I think there was Lightspeed who were a key referrer of yours. I think started to go direct and do their own product. I'm just wanting to get a bit of a sense of if that mix has shifted and if you've become more reliant on your external sales partners or referring organizations, or if there's been any shifts there. Look, Brendan, our run rate direct to Tyro applications is still running 55% direct and 45% through partner channels. We're still working with Lightspeed. Yeah, Lightspeed, we've still got a strong relationship there. They are using some other referral partners as well, but they're still working very closely with us. That hasn't resulted in a material change in mix. I suppose the referral networks that we have in place now, we're seeing, as I mentioned, Telstra is coming through strongly, and that continues to build month to month. Telstra does tend to play. I mean, it's more on the small side. That's the nature of the merchants coming through there. We're still... We've still got a healthy pipeline of large merchants, that our key account team's working on. Look, no dramatic shifts in the mix. Nothing that I'd be calling out as fundamentally changed half one to half two. Okay. Cool. Thanks. Prav, I think you just mentioned actually on the margin assumption in the guidance. Can you just maybe elaborate on the international transaction mix that is assumed, I mean, it's at 1.7% now, but if that was to trend back towards, you know, obviously towards the 4% or so that you were seeing pre-COVID, that would have a negative impact on the margin. Just interested in the assumption for the recovery of international. Yeah. Yeah. Sure. No problems. We're seeing the internationals obviously increase from last year. It went from about 0.7% last year to about 1.7% this year. If you actually look at the chart on page 21, it seems to have settled around that level. We are definitely in our forecast assuming that it does go up, but probably more so in the second half of the year. It shouldn't really impact our guidance in terms of the top line, because if it does come through, your transaction value should go up. The unit margin would be dilutive, but it would still be the same dollar level gross profit. It is a key one, so one that you'd probably need to take a view on. The other thing I would say is, with the Bendigo book coming in and contributing about AUD 5 billion-AUD 5.5 billion, from what we see with the transition merchants so far, there isn't a significant international transaction mix. If that assumption holds all throughout, I would not see us going back to the 5% that we were pre-COVID. So probably more at peak, probably more closer to 3.5% or so. Okay, that's clear. Last question. Is there any update to provide just on the CEO transition, Robbie, or the progress on sort of finding your replacement? Look, I might jump in on that one. Look, it's. That's something I'm not privy to, as you'd understand. But look, as the board's communicated, there's an external and internal search process going on. That when there's news to announce, I mean, the board will come out with something on that front. Look, Brendan, I'm probably not the right person to be making a statement on that one, but that's the state of play at the moment. All right. I'll leave it there for now. Thank you. Thank you. Your next question comes from John Campbell from Jefferies. Please go ahead. Good morning. I have two questions, if I may. When we actually have a look on your balance sheet, we can see a lot of intangible assets there. Can we just get a feeling about how confident you are that you've got enough capital? I know you've got a lot of regulatory capital, but just interested in the carrying value of the intangibles. Yeah. Hey, John. We do have a significant number of intangibles on our balance sheet. The biggest one is Bendigo. From the accounting standards, it requires us to carry that intangible upfront over the period of the deal. That's AUD 110 million. We do have to actually test it for impairment as part of our accounting close. As we presented, the actual results of the Bendigo transaction are slightly better than where we had in our forecast. No indicator of impairment on the Bendigo. We've got Medipass, which is again a significant intangible on our sheet. Same thing. We have tested it for impairment. Health is an amazing opportunity, and the complexity is actually the model. From what we have seen in development since we acquired Medipass, if anything, the value is much greater than what we're carrying on the balance sheet. As I mentioned, we do have a very conservative accounting policy in terms of intangibles that we put on the balance sheet from internal development. Last year, we put AUD 7 million on the balance sheet, and they are definitely for transactions or for development that provides us value into the future. We've already started using some of these, hence amortizing some of these. From a capital perspective, as they come on the balance sheet, they're directly deducted from capital. That is one of the reasons why our capital has actually come down in the last year and a half, is because all those are an upfront deduction. As they then flow through the P&L, there is either a neutral or a positive impact to our capital position. Does that suggest that the statutory shareholder funds continue to decline? The statutory shareholder funds. Your statutory shareholder funds would be in line with your regulatory results, which, as I mentioned, was about AUD 12 million a year. Sorry, can I just go back? Because it is an important point. Does that imply, going forward, we should expect to see the statutory shareholder funds decline? The intangibles? No, the total value of net shareholder funds. Probably not. I don't think it should, because as we amortize the intangibles, the deductions decline, and that washes through to the P&L, which comes to our retained earnings. Okay. Just the other one, just on slide 13. You talk about all the operating costs and some really good disclosures there. One of the things that you talk about is the reduction in the staff numbers. I see down, you talk about basically non-permanent or, well, basically admin expenses increasing for basically consulting people that are basically filling full-time jobs. Can you just give us a feeling on whether staff retention is an issue? Yeah, great question. Again, one of the things I mentioned, we did actually accelerate investment into our three key initiatives in that last quarter. If you actually look at page seven of the pack, that's when we accelerated using the contractor costs to make sure that we're delivering these on time without having to hire permanent people that would commit us into the longer term. As we are completing the phases of those projects, we're driving down the contractor numbers. Anything else on that, Robbie? Any other questions, John? Yeah, I did. Just a final one, if I may. We had the RBA increase the interest rates in May, June, July. They'll probably do the same thing in August. Is there any explicit rate forecast that you're using in your guidance numbers going forward? In terms of our lending income? No, in terms of just what you're seeing in your businesses, potentially as liquidity drains out of the system as the RBA increases interest rates. We look at our business in two ways. One is the banking business and the other one is the payments business. From a banking perspective, we have loans that are very short duration, so about six months, which is consistent with prior year. An increase in interest rates is actually positive for short-term assets like ours. From a deposits perspective, again, majority of those are on call and short term. The way we look at our guidance is effectively a fully funded asset position from a deposit side. Whatever increases we would factor in, and I wouldn't probably call out the exact rates, but whatever increases we factor in, the loan income would offset, more than offset from the deposits increase in interest rates. We don't have any wholesale funding. Sorry, I haven't expressed that clearly. I'm more interested in is rates rising, does it become actually a problem in the transactions business? Are you, John, are you worried about merchants failing in that business as a result of this? Yeah. this? Yeah. No, not merchants failing, but people just have less money in their pockets, so they spend less. Merchant transactions go down. I'm just wondering, have you got something explicitly in there for that? Yeah, that's what I was trying to explain before. We're following that really closely, and I don't have an answer for you on that one. One side of the argument is if the inflation goes up, the actual prices go up, and therefore the transaction value that goes through our machine is higher. On the other side, obviously, as you mentioned, with people having less money in their pocket, discretionary spend goes down. The question is, what is the net of the two? Don't have an answer, but what I can tell you is what we forecast internally and what we're seeing is actually slightly better than what we forecast so far. John, all I'd add on top of that is, you know, to date with the rate environment we've been in, we've seen no impact. The other side of the ledger, I suppose on that one is, big part of our growth is coming from taking share from elsewhere in the system. You know, whilst we continue to grow our merchant uptake and we, you know, keep punching above that 1,200 new signups every month, I mean, that's sort of the other mitigant there, if there were an impact going down the road with the economic environment due to the rate environment. Thank you very much. Thank you. Your next question comes from Elijah Mayr from CLSA. Please go ahead. Good morning, guys. Just a couple from me. Maybe just firstly on churn. We've had merchant churn actually come down a bit, and transaction value churn step up a little bit. Can you just sort of talk us through the mechanics there? Are you sort of, I guess, churning through higher value merchants to get to those figures? Yeah. Look, the actual transaction value churn number, you know, is pretty benign in the scheme of things. It did tick up a little bit. It would indicate, you know, that probably some less micros and perhaps some more small might have churned in the mix. That's the call out I'd make there. Probably the most important one that we focus on in terms of just our performance though, in terms of retention of merchants, is obviously the merchant count churn, and that has improved, right? That's actually come back a bit. We're comfortable with that. You know, what we've said in the past, and it still maintains true today, in that merchant count churn, about half of that is merchants going out of business. That actually hasn't changed over the years. We're pretty comfortable with how we're performing in terms of merchant retention. You're right, there's slight deterioration in the transaction value churn, which just would indicate a skew from micro to probably small and a little bit larger than small in terms of churn rates. Yeah. I guess if you're looking on a first half, second half basis, it's looked like it stepped up in the second half. Is there any sort of, I guess, particular call-outs there, a change in environment? I mean, were there sort of initiatives put through during COVID lockdowns to keep merchants and transaction values sort of, I guess, plugging through? I just wanted to see if that momentum sort of shifted at all or sort of how you're seeing it at this stage. Yeah. Like, it's so small to be you couldn't call out a thematic on the back of what we've seen. I'd suggest there's nothing to particularly call out on that front. It is a very fine change in transaction value churn rates. So, yeah, nothing changed in our way with trading merchants or dealing with merchants with any hardship issues. That's all consistent with, you know, we're always we always err on the side of the merchant if there are issues in their performance. Yeah, nothing has changed that would warrant a call-out. No problem. Maybe just secondly on, I guess, looking at your market share, particularly in your core segments. You're sort of close to that 20% mark. Do you guys have, I guess, internal views on where you can get to from a market share perspective across those core segments, in particular? Yeah. for hospitality and retail, understand? Yeah. Look, a couple of things I'd call out there. Our overall market share of the total card present, card not present market sitting at 5.1%. I mean, we are nascent, would be how I would describe our position. When we call out our penetration in that sort of the core vertical, health, hospitality, and retail, that is a proxy that we've always put in there. It is only SME, so it's merchants between AUD 50,000 in transaction value to AUD 5 million in transaction value, which we are well and truly playing outside those bands, both on the upper end of the scale. You know, our biggest merchant is sitting around about AUD 500 million in transaction value. So it doesn't truly represent, I suppose, the penetration we could have in retail, in hospo, and in health. I think there's still a lot of upside to be had there as we start winning more large merchants in our features that really does play well for those larger merchants. Look, on the other side of the ledger, there's less than AUD 50,000 in transaction value. We haven't had a solution for that part of the market to date in those verticals. Now we've got the app, the Tyro Go Reader, we can actually start playing more aggressively in that space as well. Look, I would point to Elijah more to what is our share of the total market, and that's at 5.1% mark, and why we are interested in pushing beyond those three core verticals and looking at the trade space, looking at the services space, and looking at the accommodation space, because we know they are underserved. They have feature-poor solutions currently, and we think we can do plenty in that space. We're excited about the opportunity sitting in front of us. No problem. I guess in that trades and services space, is there any sort of early headway that's been made to date? Are you sort of transacting any volumes at the moment that's worth calling out? In that space, but because we only have. Yeah. The trade space really did need the Tyro Go Reader, which only went to market in May. Look, there's still a little bit of work to be done there for the general availability, but the fully automated onboarding for anybody buying a Tyro Go Reader is something that's in train at the moment. It's It's one of the projects Prav mentioned. That sort of needs to be rolled out before we can actually get in there and start aggressively chasing the segment. No problem. Thanks for the question. Thank you. Your next question comes from Scott Fraser from Morgans Financial. Please go ahead. Good morning. Thanks again for what is finally some communication to the market about your results and where you're seeing the company going. I just wanted to focus on slide 13, the operating cost basis. Really, where do you guys see the easy wins here? I know you're focusing on headcount, but that first point with regards to the new staff from Medipass and Bendigo seems to suggest that there's some big chunky teams that you've added recently. My second question would be around, are you guys seeing a peak in the cost in the contractors, and is that starting to taper off? Thanks. Look, Scott. Yeah, thanks, Scott. Thanks for the question. Look, I might take the first bit and then throw to Prav and Giovanni if they've got anything to add. Look, in terms of Bendigo and Medipass, look, just to put that in context, when we announced the Bendigo deal in October 2020, we called out very clearly in our pack what the extra headcount we needed for that bit of business. Look, that this is the year, which FY22 is the year when that cost actually came into the P&L. That's sort of the base to serve Bendigo. That's now in, and that will be, you know, that will continue. You know, it's just part of servicing, you know, that great opportunity with, you know, AUD 5 billion in transaction value, which is growing, you know, 8%, which is really good, and it's got more growth potential in it. In terms of Medipass, 23 team members that came on board. We called this out when we, in our release when we bought Medipass as well. Medipass for us provides a unique set of claiming rails that we didn't have, which gets us into the statutory compensatory funding piece. The things like eye care, NDIS, WorkCover Queensland, and WA as well. That headcount that we applied there, technologists that are really expert in that space, built that solution is piece that was missing in our mix. Tyro Health was great in the claiming piece for health, but we didn't have those other claiming rails, which really enables us to provide an all-encompassing solution to healthcare practitioners. That headcount, again, you know, we bought that business to get that skill set, and they were a key part of that. They're part of the story going forward. What we're excited about in health is we've brought the claiming piece for Tyro together with the extra rails with Medipass. We've now got a fully card present and digital solution which provides a great offer for healthcare practitioners, which means we're much more competitive in the market. You know, stay tuned for this financial year, but that business is actually performing strongly, and we've now got a really all-encompassing product solution. Prav, might throw over to you if there's anything else you wanna add on that front on the costs. No. Nothing in terms of the normalized costs. I think you've covered everything. The only thing is, from a statutory perspective, we've obviously got some choppiness as we roll out Bendigo, so there is some transition costs, and that will, as I mentioned, cease to exist once that fleet is fully on board. Sorry, didn't mean for those, Medipass from Bendigo Bank to be the main emphasis of my question. It was really around where you see the easy wins for your cost per transaction reduction and, sorry, your operating cost per transaction reduction as well as with your contractors and consulting expenses. Do you guys feel like you're seeing peak costs there, and are they starting to taper off at all? I think if you go to slide 7, that would suggest where our headcount has peaked. In terms of contractors, we did actually go fairly high in that last quarter just to make sure that we got everything we needed to start delivering those key projects, and they're now tapering off. Easy wins, as I mentioned, discretionary costs, they're where our focuses are in terms of easy wins. I think 70% of our cost base is card cost, which is why we do flex with contractors, so we can have project-related headcount that we don't lock into the long term. Great. Thank you. Thank you. There are no further questions at this time. I'll now hand back to Mr. Cooke for closing remarks. Just, I'd like to thank everybody for their time and interest today, and we'll talk again soon, I'm sure. That does conclude our conference for today. Thank you for participating. You may now disconnect.