Welcome. Thank you all for joining us today for the WAM Leaders FY 2026 Full Year Result and Share Purchase Plan Webinar. My name's April, and I'm from the Investor Relations team, and today I'm joined by Matthew Haupt, Lead Portfolio Manager, and John Ayoub, Portfolio Manager. Before we begin, a disclaimer is displayed for you on the screen. What we discuss today will be general in nature and is not financial advice. To start, I'll give you an update on the share purchase plan available to eligible shareholders, followed by an overview of the WAM Leaders' full year results. I'll then pass over to Matt and John, who will provide a market update and discuss key investment themes and reporting season insights so far. Matt and John will also discuss what opportunities they're seeing in the market, and why now is a good time to raise capital in WAM Leaders. We look forward to taking your questions towards the latter part of the webinar. The share purchase plan. We're pleased to announce the share purchase plan available to eligible shareholders. The SPP provides the opportunity for each shareholder to invest up to AUD 30,000 of fully paid ordinary shares in WAM Leaders at a discount to the current share price and without incurring any brokerage fees. The key details and dates are available on the screen, and they are being sent from Boardroom to existing WAM Leaders shareholders today to consider. A key date to be aware of is Tuesday, the 1st of September, as that's when the offer closes. In terms of price, the price will be the lower of AUD 1.325 per share, which is the 31 July pre-tax NTA for WAM Leaders, or a 2.5% discount to the five-day volume-weighted average price as at the issue date of the 4th of September. Matt and John, maybe we'll start by you covering off why now might be a good time to raise capital in WAM Leaders. Yeah. Thanks, April, and we'll go into a bit more detail later, but we think we're at the start of a real regime change in Australia, and globally, to be honest. For us, we've had two to three years of really, I almost say distorted markets, and that is coming to an end. For us, it's a great time to raise capital, and we think we can deploy it before the market works out where it's going. For us, it's really an opportune time to get on the front foot and raise capital. Great. Thank you. Now we will move on to some of the financial highlights for WAM Leaders for the FY 2026 year. The portfolio increased 14% in the 12 months to 30 June 2026, outperforming the S&P/ASX 200 accumulation index by 7.9%. For the 12 months to 30 June, the total shareholder return was 24.7% when including the value of franking credits. Since inception in May 2016, WAM Leaders has increased 12.1% per annum as at the 30th of June 2026. On the next slide, we have dividends. The board has declared the increased fully franked full-year dividend of AUD 0.096 per share, with the fully franked final dividend being AUD 0.048 per share. I will now hand over to Matt to provide a market update. Thanks, April, and thanks everyone for joining us today. Just a big thanks, WAM Leaders has been going for 10 years, so a really big thanks to all the supporters on that journey since we IPO'd, and welcome to new shareholders through the placement and the share purchase plan. What I am going to talk about today is our outlook for the Australian market and why we think we are going through a regime change. Then I will hand over to John, who can talk through some of how we are doing it, some of our top positions, and also some of the market dynamics at play, which really go to our point around a regime change. The outlook for the Australian market, we think it is really caught in a pretty tough spot in the short term, but we have an increasingly positive view where we will be going in the latter half of this half and into next year. Really, it is around the RBA. The RBA, we are making a call, and we can go through the slides later. We think their hiking cycle will come to an end. We will get an update today. For us, this is going to be key for the Australian market because the Australian economy has hit a bit of a roadblock in the last few months. It is getting a slowdown. You are starting to see that in results. For us, the monetary settings in Australia are restrictive. They need to ease. We are probably about 35 basis points too tight. We think there is a possibility for an easing cycle to kick in in FY 2027, or calendar year 2027, which will be a really big tailwind for the Australian stock market. But we have just got to navigate this tough period now, waiting for the RBA to pivot. Why do we think it is a good time to raise money as well? It is really around the regime change, and this change goes back a long way. We have been operating in an environment where volatility has been suppressed, going all the way back to Greenspan, and primarily through quantitative easing post-GFC, and all these events we have had subsequently. Every time volatility has come up, it has been squashed, and you might be wondering, what does this mean? It means a lot of the financial community, when they see volatility squashed, they lever up. What you've seen is over the last 10 years, and really post-COVID as well, a huge amount of leverage being built up in the system, and that leverage finds homes all over the globe. What we're seeing is a bit of a change to that regime, and it's starting to really show up. The real catalyst for us was the change of the Federal Reserve governor. Kevin Warsh is in there now, and he's walked back from forward guidance. He's basically saying, "We're going to let markets dictate where price goes." The Fed used to guide the market softly with their dot plots, and really trying not to shock the market. Governor Warsh is going to come in and let volatility or market pricing work its own way out. What does that mean? We think leverage will come out of the system, and like I said, leverage has been building up through the system for decades. You're starting to see pockets of it happen through currencies, through interest rates, and equities, and Australia will not be immune, and John can talk through some of the consequences of that as well. If we move to the next slide, I think if we look at how to position the market, and what we say about regime changes are, this environment has built all these factors which people invest according to. What we're saying is these factors are based off historical data, which was in a suppressed volatility environment, and that is changing. All this data, which was relied upon and the way people invest for the last 20 years, needs to be reshaped and reclassified. We think that will be a real key moment when these quant-driven funds, which quants are basically money that just follows signals, a lot of those signals are changing. Another important point is around what is a growth company anymore versus a value company. Value companies used to be very heavy in CapEx, very cyclical. We think that has flipped, where growth companies are now becoming the new cyclical heavy CapEx spenders. Again, regime change. What happens in a regime change? It creates opportunities, and that's why we think it's a great time to invest ahead of this, really getting ahead of the curve. We think value is the place to be. You've got to be in value over the next six months. Value works in very small pockets or small windows, so we won't get too excited about value, and we will trim once the rewriting happens. Again, look, if we look at Australian market, obviously the trade has been long momentum. When we look in the Australian market, what is momentum in? Momentum, these charts we've put up on the page here for you to see, is around Australian resources have become a bit of a proxy for momentum or the AI trade, another way to put it. You've got to be careful around this because a lot of the resource companies, in particular copper, has probably got a little bit over its skis on some of the valuations on the equity side. If momentum does change, which we're seeing at the moment, when volatility increases, momentum does fail. We are really cautious on momentum and in particular, it makes us a little bit cautious on some of the materials. We think the materials ultimately will be supported by China coming back to help their economy, because what happens is China stimulates, growth goes up, then it starts to slow, and then they come back in to stabilize it and then accelerate it, and we are in the stabilization phase, and we will go into the accelerate phase later this year. Resources, obviously, will get caught up with the momentum trade, but we are not too concerned about that over the medium to longer term because we think there is a global pickup in industrial production at the moment and an accelerating China in the back half of this year. So, navigate that space with caution, but we think medium to long-term, it looks okay. I guess the other one is everyone focuses on the KOSPI, which is the Korean stock market. Very speculative market, hot flows, and it was a bit of a proxy for how Australia traded too. But recently, the Australian stock market has gone to an inverse correlation with the KOSPI. So, as we talk about regimes are changing and correlations are changing, it is going to be a really interesting environment over the next period as this happens. If we go to the next slide. So what we are showing here is we are not going out with momentum. We think momentum has had its day. We think that regime change is underway, and all the forward indicators which we have put up in front of you here show you why that is the case. I think the real key one here is around momentum and volatility, and volatility not being suppressed and leverage coming out. How do we know this? Well, we look at different areas of the market. We look at the primary dealer repo market, which is effectively where hedge funds go to lever up. They lever up on basis trades, which is the difference between a bond and the futures contract to pick up little bits of money. That is starting to slow. The primary dealer repo books are starting to slow. So this leverage is coming out. It is slowing, so the impact is obviously less. We think that will really show up in the back half of this year. Momentum is not a place where we want to go at this point in time, and we are really tilting towards value, which John will explain through our stock portfolio later. If we go to the next slide. One of the things, and we will get a real key data point today with the RBA. Actually, we do not care if they raise the cash rate for our real estate investment trust thesis because a lot of the real estate investment trusts are based off the cap rate, the capitalization rate, which is the long end of the curve. Everyone talks about the cash rate. What we look at when we invest is the shape of the yield curve, how that shape is moving, and that is the period from cash rate all the way out to the 10-year rate, really. Australia doesn't really have much beyond that 10 year, so that's a really important shape for us. What we're looking for with the RBA today, we think they will be a hold. We think they will introduce some dovish language into the press conference and the press release because there is a slowdown in the market in Australia. We're seeing it through housing and through some industrial companies, like Seven Group today came out and missed expectations. That's trading down. Westpac the day before had a soft update as well. It's really showing up, and that's why we think the RBA, with the soft inflation print we had and the soft data they're getting now, should start to pivot. The RBA will never do a full 180 backflip. What they'll do is gradually walk you down the path, and we think that path will be on display today. We think they will walk the language back, open up the dialogue around softer housing. Also in the Westpac result was a really key point around offset accounts being run down. Those buffers are getting degraded, so you're starting to see a real impact already. Arguably, the rate hikes haven't really flowed through yet. We think given government policy where it's at, the housing market soft and industrials downgrading, we think that will be key for the RBA changing their view and ultimately going to a cutting cycle. We don't care if they hike today, which given the probability in the market, it'd be highly unlikely. If it were to happen, we don't care for our real estate investment trust thesis because what you would see is the long end of the curve start to come off, and that's where a lot of our investments are priced, off the 10-year investment rate. Again, we don't care if they hike today. It would accelerate our investment case, so it would actually be a blessing. It's not going to happen based on probabilities. Highly unlikely. For us, this is a really unloved area of the market. People won't touch it because everyone thinks interest rates are going to keep on going up. That's the constant feedback we get when we talk to analysts. They're like, "The rest of the Street will not touch rates because they think interest rates are going up." We think this is a real area of potential outperformance for us over the remainder of the year. If we go to the next slide. What I'll do is hand over to John now, who can talk through some of our top holdings and some of the dynamics as well that we're seeing across markets. Thank you, Matt, and thank you and good morning to everyone. Again, just like to echo Matt's thoughts about the support that we have had over the last decade, hopefully we can continue to deliver shareholders some strong performance in the next decade ahead. We spoke about leadership change several times in Matt's comments there. What does that mean practically? That means we are going through an inflection point in markets. Historically, Leaders' portfolio has done well during inflection points. What we like to do is go ahead of the curve, move against the tide, so to speak. What we are seeing now is that changing of the guard in the Australian market dynamic. That doesn't necessarily mean markets will go up. So we will warn people with that backdrop, but our portfolio typically outperforms during these periods. If you look at the last week, for example, our portfolio has had some strong performance in a fairly flat market. What we are seeing is now those top 10 stocks in the ASX, the major Australian banks, as they start to give up their performance, we will see a broadening of the Australian market rally. So from a headline perspective, doesn't mean the ASX will hit new highs and continue hitting new highs. We are happy for it to stay level, the levels where they are at. We are happy for it to drift 5%, 6%, 7%. It doesn't really matter to us because where we see the opportunity is the next level down in the market. Some of that stuff, maybe it's worth fleshing out the dynamics that we are seeing in the market today. Firstly, where we are seeing more opportunities and why we are happy to deploy more money into this market is people are so fixated on the next data print only. There are more and more hedge funds in the Australian market that only care about one-day performance or next week's performance. We are taking a longer-term view. We are thinking more 6- 12 months ahead. The quant funds, as Matt said, and more of the index funds, again, they are dictated as to what they can buy and how they can buy it, and that creates distortion in the market. They are so fixated with how big a company is as opposed to what value that company is going to derive. They forget the fundamentals of businesses, and we are seeing that spit out more and more and more every day. From that perspective, I will give you an example of what we are seeing today. I am going to go into a little bit of detail around how markets are working. The MSCI All World Index is a $17 trillion index where most asset managers around the world follow that to get their global exposure. Within that index, there are 47 Australian stocks. In the next review of that index, seven of those Australian companies are being removed out of that index, forcing AUD 6 billion worth of selling that just is indiscriminate based purely on the mechanics of that index construction. For us, that is an opportunity. Really good stocks like Stockland, like Mirvac, get sold, get shorter, get whatever it might be, and creates great distortion in the marketplace. We are really happy to take on this selling because we take that 6 to 12 month view on the Australian market. As we enter into a rate-cutting cycle, these stocks are mispriced. So the more they fall, the more we are happy to buy. So that sort of dynamic is playing out more and more and more and causing that distortion, which we are really enjoying. Further, if we take the Australian economy, absolutely it is under pressure, but that leads to rate cuts. And what happens with rate cuts? Markets typically perform well in those periods. But there is a diversification. Our portfolio is heavily skewed, as you can see from that top 20 now, to a lot of U.S. cyclical stocks. Why we are happily to be exposed to stocks like James Hardie, BlueScope, Amcor, these names have tailwinds, and the U.S. economy is really strong and robust. So for us, we think for the next three to six months, we are happy to see that dynamic continue, but we are building the longer-term portfolio around some of these more cyclical names in Australia. The Lottery Corporation, the Cleanaways, these are the next level down beyond that top 20 that you do not see, where we are really positive around the outlook, and we will take weakness in results as an opportunity to build longer-term positions. A real-life example, Matt mentioned Seven Group Holdings. It is down 8%-10% now. We are away from the screen, so I cannot tell you exactly what it is, but we are using that as an opportunity to start to build a position in the portfolio, because people are so fixated on the today, they are forgetting about the tomorrow. So for us, really excited about these markets and what opportunities they are going to bring. Elsewhere, I will highlight the gold sector. And for those that have followed us and heard us on previous calls, we are not really positive. We have never been really constructive around the gold space. But the volatility that the U.S. Fed is now reintroducing to the markets, we are now overweight gold for the first time in a long time. And we are really constructive around those mid-cap gold names, the Bellevue, the Capricorns, the GMDs, the Vaults, where we think there is going to be continued M&A, which we have already seen play out, and we think those are really attractive opportunities. The upper end of the tier, our preferred big gold play is Newmont. The deal that they consummated yesterday is really positive, so we are happy to continue to hold gold. We will trade that tactically as opportunities arise either way. And it is probably worth commenting now on the materials space. Yes, Matt said that we are starting to lighten there, but stocks like South32, we continue to happy to hold that because there is a rerating story after years of turmoil in that business. Rio and BHP, they are very liquid, very opportunistic positioning in those space. And we welcome Glencore to the ASX when that comes. We have been waiting for a long time to own that one, and we are very excited about having the opportunity to finally get a position in our portfolio of that one. So I think that is probably a good wrap of where we are seeing the market and where we are seeing those opportunities in our top 20. Happy to pass it back to April now. Thank you, John. Thank you everyone for submitting your questions. We've had a few come through. The first one is from Gregory. "The dividend yield is around 10%, including franking. How do you maintain this? It's much higher than the average yield on the rest of the ASX." Yeah, it's a big yield, which is I guess the attraction for people as well. We look at it more like on how much are we generating on the portfolio, and how much of the dividend as a percent of the NTA are we paying out, and what is sustainable. For the stock market, it averages 7%-10% per annum. We've got a pass-through yield of 3%, call it 3.5%. So, in theory it's sustainable, and we have a big profit reserve. You look through the history of WAM Leaders, and we've almost paid out AUD 1 of dividends back to shareholders if you gross it up. We've never missed a dividend, and it's just been growing. So very sustainable, and we do have a big buffer in place. I think when you look at it from a component point of view, like the pass-through yield, the capital growth, it's actually sustainable. Tom has asked, "WAM Leaders seems to do well when markets are volatile. Why is this the case, and how do you make money for shareholders when things are so unpredictable?" I do not know why, to be honest. We love the volatile markets. It is a little bit more painful. You have to work a lot harder, but we actually thrive in that environment. When there is dislocation, maybe because we do not have huge emotion, we just process, we are like, "Okay, opportunity." We do not get caught up in the noise. We are a very logical, very disciplined approach. I think the key is that emotion. We do not let emotion override decisions. When things are falling apart or people get scared and they start selling things indiscriminately. Also, we are a closed-end fund, so we have the beauty of just not worrying about flow, so we can just sit there and target where we need to put capital. I think it is our top-down approach as well. I would say I think it is the top-down approach, where we like because we watch global markets so closely, and we can quite often pick inflection points. We can see it building, and we can see it building now. We will be early inevitably. We are always early. But once they happen, we can act pretty fast. So I think it is having that holistic approach. Closed-end fund. We have been doing it for- Decades. decades, so we have been through cycles. We know how cycles work and how support eventually comes in. I think it is just not panicking. I think one of the things that we definitely do not do is we do not speculate. If you look at the journey for WAM Leaders, in periods of drawdown where markets fall, we outperform, I cannot remember the exact number, but most of the time. But in rampant bull markets, we do not keep up, and that is because we do not speculate. We stick to the discipline of our process. I think also over the last 10 years, we have probably seen a lot. There has been countless political and geopolitical events that have caused this volatility, and again, if you just take a step back, as Matt was saying, and just look at where the opportunities and where the value is, we enjoy that and we thrive on it. Equally, we know we can get things wrong. If you know you can, and can accept getting things wrong, it makes it a little bit easier to sell things when you are wrong rather than to hold on and hope. That is one thing we have eliminated out of the process is hope. Mm-hmm. This year it has been quite event-rich with the Iran conflict. Again, taking away from the event, obviously tragic, people. We all know the reasons, but the volatility creates opportunities. Now with geo-risk, John was just saying, the Ukraine war with Russia, there is a risk it spreads to Europe. There was an issue the other day at Leipzig where there was a DHL plane and there was a drone, and you can see it is just bubbling beneath the surface. These events, you just watch them build, and you can change your position accordingly. It goes back to the gold position as well, taking a bit of a hedge there in some of these geo flare up periods, too. Mm-hmm. Beryl has asked, "You have previously been underweight the banks, given the extreme valuation, what is your current positioning and view from here? Yeah, I think we are probably the most underweight banks we have been for a long time. They did pop up on the top 20 I saw. Again, you have got to separate tactical. Technical for us is we cover during periods where we think we need to cover. During July, it is very much a super-driven inflow period, the seasonality, so we went actually a little bit more long banks, still very underweight, but the top 20 showed all, I think, showed three banks. Three. But that will have been paired back. So we are very underweight banks. What happened was banks went on an incredible run, basically because it was earnings upgrades and no thought about valuation, and that is where we got it wrong. We were too worried about valuation. We thought that would overrule the EPS momentum, and it never did. But now we are going to have the reverse, you are in an EPS downgrade cycle and valuations are still silly, primarily CBA. So, we think banks will be a key area of outperformance for us over the next 12 months by having hardly any banks. In totality, it might be about 8%, 9%, it could get down lower. But we want to be cognizant of flows as well, because we do live in a super system where there is just money every week. It does not matter, it is just going to come in. So we would love to be zero, but we will not be zero. We will keep a little bit there. But the cycle has changed. They are in a downgrade mode now, and Westpac looks the key. CBA tomorrow, definitely next year looks tough. Yeah. They might hold on for another three or six months, but directionally it is down. And if you look at just where the credit growth numbers are coming out and the competition level that is starting to intensify, earnings can only head in one direction. So it is very difficult to build any sort of justification to be overweight banks or anywhere near index weight in banks right now. We have a question from Nava, specifically on CBA. "Do you think it is a value stock? Any views as to why some other fund managers have stated that they are shorting it, and is it a momentum play?" Covered off a little bit of the other side. Yeah, it's a great question. CBA is definitely not a value stock. A value bank should trade around, if we're generous, 1.2x book around. But if you value play, you'd be often at a discounted book. CBA is not either of those. It's silly valuation. Everyone shorts it because it is a silly valuation. What will change that? Well, it's flows. Flow keeps hitting it. It's in the MSCI, it's one of the top MSCI stocks now, next to SK Hynix and Samsung, and it's right up there. Passive flow just keeps hitting it, and domestic fund managers are all underweight, so if it goes up, they chase it, so it's self-fulfilling. People short it on valuation grounds, which is correct, but you've got to take into account flow. That's where we spend a lot of our time, on flow. For us, not value, get why people short it, but, we will never be short CBA. I shouldn't say that. At this point in time, we'll not be short unless something breaks in the flow dynamics. Yeah. In the past, we've touched on indexes and the way that index dynamics work, and it's probably worth refreshing that the ASX200, which we invest, is made up of 200 stocks. CBA is 11% of that index as of today, thereabouts. Every single dollar that comes into the ASX, new AUD 0.11 has to go into CBA as the maths work. For the last decade, the ASX has been in inflow, so every dollar that comes in, it's a forced buy of CBA. Under the MySuper rules, the performance test, every large super fund in this country is so paranoid of underperforming that they track the index blindly. As we start to shift from an inflow market to an outflow market, as people start to redeem and start to use their super in the later stages of their journey, it's interesting because we'll go, that dynamic shifts from inflow to outflow. Every dollar that comes out of the ASX, AUD 0.11 has to be of CBA. For us, that dynamic that's dictated the market over the last decade starts to shift and you can see why potentially as a funding source. If we talk about some of the funds that may short CBA, they don't necessarily always short to make money. They will sometimes short for the ability to leverage up their portfolios. As they'll short a large position in CBA, so as they can buy something offshore because they think that stock will outperform CBA by 10%, 20%, 30%, or whatever the number is. There are a lot of interesting dynamics that are at play, which ultimately goes back to valuation, and we think they are overvalued. The other big one was the yen carry trade. We had a glimpse. It was August 24 when the yen carry trade unwound. People borrowing. Again, this is part of the problem with the leverage in the system, all these silly trades where you borrow cheaply in yen, and then you invest elsewhere. When the yen carry trade unwound in that shock moment, CBA was down 7%. You can see all these unnatural holders are positioned in it. For us, it is a bit of a pain, to be honest, CBA, for us, having to go through these dynamics of flow. We would love to assess it on fundamentals, but unfortunately, like John said, we cannot. We are moving from accumulation to pension phase in a lot of those super funds, so the dynamics will change soon. You mentioned the index before, John. Nick has asked, "WAM Leaders' top 20 holdings is dominated by banks and major miners, i.e., it looks like the top 20 index. How will you differentiate from the index?" Yeah, look, that snapshot from last month, if we go to slide 13, it provides a bit more depth around how the portfolio is positioned. If you look at the very bottom line, we are 14.7% underweight our benchmark when it comes to financials, and financials are predominantly the banks. Then you go to the very top of it, you have materials and REITs as our biggest overweight. That skew has changed again as we have progressed through August. Within the material space, it captures stocks like James Hardie, it captures the lithium names, the gold space. It is not purely just BHP and Rio. A lot of our positioning is outside of that. An example is, for the better part of the last three or four months, we have been around 2.5%-3% of our portfolio in James Hardie, whilst the index is around 30 basis points. If we look at Aristocrat, we have been somewhere around 3% of the portfolio for the better part of three or four months. Again, the index weight is 60. So a lot of our skew has been outside that ASX 20. We do own them, and they do form a large percentage of our portfolio. But from an active positioning standpoint, we are certainly underweight the banks, certainly underweight the ASX 20 in a large way. And that, what you can see from the July numbers, has even increased- Yeah. as we have progressed through August. Yeah, we have a huge amount of tracking error versus our, I call it our peers, maybe. So tracking error is basically deviation from the benchmark. Yeah. We are carrying huge tracking error. We do not marry what the market does and, like John was saying, when you see the top 20, you might think, "Oh, wow, that is just an index fund." But beneath the surface, it is very different. And quite often, during that July period, it is a very strong period like we were describing earlier. So sometimes we carry, it is a bit of a term, but more beta. We know the market will run in a period, sometimes to get that exposure, we go heavy, and then we pull it back out when fundamentals start kicking back in. It is quite tactical, but I can guarantee you will not get index returns from Leaders. If that snapshot was a week earlier, we probably were 600 basis points closer to indexing financial. Last month, I think CBA, and forgive me if the number is quite out, was up about 8%. We need to protect the portfolio because our job is to make you guys money as shareholders. When we look at the historic seasonality of July, as Matt was pointing out, banks have some of their strongest periods in that month. We have to tactically protect ourselves and protect the portfolio from a performance standpoint, and we can unwind it given the liquidity in those names really quickly. We have got a few questions on REITs, real estate investment trusts. Cameron says, "REITs don't deliver franking credits, so is this consistent with your fully franked mantra? For us, it doesn't really matter. We generate franking credits through the company tax we pay on the capital gains. The advantage of an LIC is the ability to frank. We don't need to get the flow through, so it is not really a decision, or there is no real thought process behind whether you need to own a franked instrument or an unfranked instrument. For that, it doesn't matter for us. Dave has asked, "Is a WAM REIT silo possible in the future?" We can give you Jeff's number, and you can take it up. But look, I think. It is too narrow a sector. Yeah, it is too narrow. Yeah. REITs have their day in the sun, and for us, if we put our Geoff Wilson hat on, we like to buy things at discounts to NTA, and right now, REITs are at a discount to NTA. So the opportunity set is presenting itself today. Yeah. For a long time, REITs would have traded premiums to NTA, and that's not a time we like to invest in them. So for us, we're going a little bit earlier, a bit ahead of the curve. But stocks like Stockland, Mirvac, GPT, and SCG, they're probably closer to their NTA, but we think there's some embedded value there. So for us, it's just the opportunity's there right now. On franking credits, we have a question from Cameron, "The profits reserve seems to support around 2.5 years of dividends at the current distribution growth. What about the franking credits reserve depletion rate?" I do have the answer here. We've got approximately 1.3 years of dividend coverage, including the FY 2026 income tax liability. Ashok has asked, "What's your view on Block?" So XYZ is the ticker. Okay. JB Hi-Fi, JBH. All right, let's start with XYZ. It's probably one of the harder stocks in the ASX to try to analyze because every single time there's a result, there's an obscure line item that people will nitpick and find a reason to sell it. But we've owned it in between periods, and I was in the U.S. in, I think it was early June from memory, and it was one of the better stocks from that trip as identified as an opportunity. It's no longer an Afterpay, it's no longer a crypto business. It's a combination of lots of different assets, I'll call it today. It still represents headline, a cheap multiple, but it's had a really good run, and for us, it needs to bed down some of the issues that the market is fixated with around the Cash App and the Cash App growth trajectory. We've reduced our position there, over the last week or so. We still think it represents some value, but we're letting that one go. In regard to JB Hi-Fi, it's an interesting one given our context around our view on rates and where rates are heading to Australia. I think short-term, if you look at some of the RBA data that's come out, not the RBA data, sorry, some of the data around appliance sales and the like, it's been very weak. We struggle to see any sort of positives coming out of the upcoming result. But that for us could be an opportunity to build a position again there, given what we think will happen over the next 12- 18 months, but there's no real rush. Yeah. It's one of the great debates in markets, where do you invest ahead of the curve? If you think there's a cutting cycle, will people look through the poor result or won't they? Our job during reporting season is to watch what companies do and the reaction of the share prices. For us, it's probably a little bit too early to say what it'll do, but our instincts would be, if they miss, it will go down- Yeah. is our view, and we think there is a possibility they could be light. We bought JB Hi-Fi five months ago, four months ago? As we thought the RBA or the rate market was too aggressive with the forward curve, we got a rerate of JB Hi-Fi as those conditions eased, but then you've got to battle the fundamentals now versus the rate call debate, and there's just tension. We don't have an answer for you today, but our gut feel would be if it's a miss, it will go down. To build exposure to the retail space, in large cap Australia is difficult. You have Wesfarmers who have the best business in the country being Kmart, and Bunnings, both of them. It is very expensive on 38 time multiple. We have done pretty well out of owning it where most of our peers have not, and we think that journey is closer to done now than beginning. If we go to the next level down and we are trying to find retail exposure, it is challenging. JB Hi-Fi is the natural one we would want to own. As Matt is saying, it is just hard to get the timing right. We are not sure on the timing. George has asked, "What is your opinion on ResMed, RMD result, and are you invested in it?" ResMed. We classify things as battleground stocks and ResMed does our head in because there is so much noise around this stock, GLP-1s, so the weight loss drug, will it destroy the market? They miss their results, and everyone jumps and starts shorting it because they think the masks will be redundant. It is such a battle stock, but the result was good. It was fine. It was slightly soft on the gross margin, but their outlook was fine. For us, it is just a really frustrating stock. There are a few in this camp where it is like XYZ is another one. XYZ was basically green ticks across every line and it still went down. ResMed went down on the result because of a small gross margin miss. For us, we like the business. It gets caught up in noise, like shorters really attack this one. For us, it goes into the battle blocks, the bucket. We are like, we will never have a really big position in ResMed, so we do have 50 basis points in the portfolio of ResMed because we like the fundamental business and its EPS growth. If you look in the health space, it dominates its peers. We would love to own more if the noise would go away, but you have all these oral GLP-1 trials this year, so the noise will not go away. Unfortunately, it will not get that clear air. For us, we would love to own more. It's probably worth a comment then just broadly on the healthcare space. If you look at that top 20, there is distinct absence of healthcare names in that top 20 of ours, and we really struggle to find healthcare opportunities in the market right now. If we touch on CSL and Cochlear, which are the two obvious candidates to look at, neither of them are out of the woods, and they've had pretty sharp rebounds off their lows, but nowhere near any of their highs either, where people are just saying, "Hey, they're on depressed valuations for the first time in a long time." But for us, we still think there's somewhat of a value trap in both CSL and Cochlear. If you take CSL first, we need some management in there, to really get a handle on what's happening in Vifor, what's happening in the albumin markets, because we're not as comfortable with the trajectory of those markets, in the near to medium term as some of the analysts are out in the street. We'd like to see a little bit more around that before we went back into CSL in a meaningful way. Cochlear, we still think fundamentally this is a really good longer-term growth story, but we need to get a handle on why it's fallen out of bed, in particular over the last 6- 12 months from a growth perspective. There are a lot of currency headwinds, there's a lot of competitive headwinds, and a lot of government funding issues. We think there's probably a little bit more pain in the Cochlear department to come, and that probably would represent an opportunity to reconsider that one. But then beyond those two, Fisher & Paykel's our largest position in healthcare today. That and Ansell, where we think near-term momentum from an earnings perspective still represents a bit of an opportunity. Yeah, we're struggling from a healthcare. We'd like to own more healthcare in the portfolio because it's a natural place money will gravitate to from the materials bucket or from the financials bucket as we see a rotation and leadership change in the market, but we're not quite there yet. Nick has asked about their NTA and discounted premium. He said, "What's the current WAM Leaders share price to NTA, and how does it compare to other WAM and non-WAM LICs?" He says, "Given the relative underperformance of two years prior to FY 2026, where does the current performance fee hurdle sit?" There's a few questions in there. Maybe we'll just start with the discount and premium. At the end of July, the NTA was AUD 1.325, which is what the- Yeah. SPP is priced at as well. I think there has been some positive moves in the portfolio since then, and the share price has come down a little bit as well. Yep. In terms of the underperformance, in terms of the performance fee, it still needs to be recouped. Yeah, that is correct. There will be more information in the annual report as well. We can give you a rough guide. Basically, last year's outperformance, you do not pay a cent on. This is, if we do outperform, which we are really confident on, you probably will not pay anything. Then basically we have got to recoup those losses from the benchmark. We did not lose money in an absolute level, but versus the benchmark. It is the greatest time to be a WLE shareholder because you get the performance and we do not take anything while we recoup it. But we think this year we have a really strong year. We would be getting close to being in performance fee territory the year after, but it is a side issue. We do not really focus on it, but that is sort of the lay of the land. Stephen has also asked about the SPP, so what is the total number of shares increased as a percentage through the SPP? The AUD 150 million cap will be an 8% increase on shares on issue at the end of July, and that is before the placement shares. There is also a maximum that WAM Leaders can raise as part of a share purchase plan, which is 30% of shares on issue. So we are aiming for less than that. Mm-hmm. Yep. Yeah. Leon has also asked the percentage increase in WAM Leaders funds under management as a result of cap raising. I think we have covered that off. Mm-hmm. Yep. Can you comment on the challenge of maintaining the fund's performance with an increased capital base? I think last year's an example of we're managing somewhere around AUD 1.8 billion most of the year, and we outperformed the market by a cool 8% in the end. So for us, if you look at the 10-year journey, performance has been +3% on the market for that 10-year period. It's more around the opportunity set, as we've discussed, and we're really excited about the opportunities that we have. So another AUD 200 million or AUD 300 million or AUD 400 million doesn't really affect us from a liquidity or a performance standpoint. It's not until we get double or triple the size from where we are today where it'll start to hamper. Yeah. We predominantly invest in the top 50. We stretch out to the top 100. Rarely do we go much beyond unless there's a great opportunity. So the liquidity, we're not constrained by liquidity. So yeah, like AUD 4 billion or AUD 5 billion we could manage, and not that we're going for that, but- Yeah. it's not even an issue, that amount. Ian has asked, "Have you factored in geopolitical risks such as the possibility of escalating tensions between China and Taiwan within the portfolio? Oh, 100%. Really interesting question because there was a big meeting with Trump and Xi earlier in the year where we were looking for a signal what they would do with Taiwan, and basically it looked like Trump laid down and said, "Green light. You can do whatever you want with Taiwan through the period of time." It's something we're watching. I don't think it's a today issue. The immediate thing is like we thought about is, the obvious trades are whether gold is a good trade around that period. TSMC, the chip industry in Taiwan, so many chips are made out of Taiwan. You'd be short all the AI trades if that were to happen because of the supply of chips. Have huge ramifications, but it was flaring up with that Trump-Xi meeting, and then it's sort of died down again, and I think it's not going to surface again for a few more years. Our base case is eventually it will be like Hong Kong when that got taken back by China. It'll be like a bit of a noise at first, and then they'll just, basically they'll do it by not stealth, but an agreement with the government in Taiwan, and then it'll just be a slow transition. For us, and it is not a today problem, but our process, we think about this every day. Like every risk, we monitor everything, and the biggest one obviously is Iran and U.S., but I think we know the outcome there. For us, it is Russia-Ukraine now is looking quite dangerous where that trajectory is going. The moment Ukraine started bombing deep inside Russia and Moscow and getting all their weapons from EU countries like Germany, Russia has talked about not putting up with it for much longer. Finland and Germany are obvious targets for some sort of action, but it is not quite there yet. So yeah, for us geo is just a fact of life. We monitor it all the time. Generally presents good opportunities. Because there is an overreaction to the noise when it comes out or the news, and then quite often it dissipates through time. We have got some stock questions coming in. Reese has asked, "Do you think Smartgroup Corporation, SIQ, will bid for FleetPartners Group, FPR? Reese, that is one for Oscar and his team. Yes, okay. We will take that one on notice. Thank you. Yeah. We can make sure we ask it in the webinar. Yeah. Next month. We've also got some questions. Gary's asked, "Are you still holding Telstra or have you sold?" We've got a much-reduced holding in Telstra. It ran up above AUD 5, and we think above that level, there's not much upside, so we have reduced it. It's still in the portfolio, but at a much-reduced level where it won't really drive any of the portfolio performance. But we want to keep a little bit of a stub there in the portfolio. Yeah, the trends in the subs won't be fantastic. I think for us, we're making the call to be underweight, severely underweight into the result, and then we'll reassess where the share price moves. But in the AUD 4.70s, AUD 4.80s, without major changes to the business, that looks like reasonable value to us. But above AUD 5, it's just not doing it for us at the moment. Telstra's dominance of regional markets, and rightly or wrongly, is being scrutinized from the introduction of Starlink. We probably don't subscribe to the theory of Starlink being the massive disruptor to the regional monopoly that Telstra has, but there are pockets of the market discussing it. The other fact is that Vodafone and Optus have had a resurgence. Telstra have had some outages, and they get that negative publicity, and Vodafone and Optus' networks have improved, and the price disparity is broader than it has been for some time. Once we start to see that discounting and a little bit of noise in the press, that normally is a bit o f a foreshadowing of what happens from an earnings perspective. George has asked, "Do you have an opinion on WiseTech and would you hold it given the governance issues?" We don't own it, and we won't own it because of the governance issues. We still think the business is a very sound business, but what we've found over the last year, some of their biggest customers are doing it on their own now. It's open to a bit more disruption than we previously thought. They have made some steps in trying to fix some of the governance issues, and we applaud them for doing that. But for us, it's not a name that we're willing to go down on investing at the moment. No, it's just the layer you've got. If the software was doing fantastic and the macro environment looked good for it, we could entertain the idea, but you've got the layer. As John was talking about, governance plus disruption. To get people on the bid side to bid for that company off you if you buy it here, there's no one lining up to buy it off you. We have spoken about sectors in the past, like the coal space. You have to buy stocks in the coal space incredibly cheap and then sell them cheap because no one is ever going to pay you fair value, and WiseTech now fits in that kind of bucket. Yeah. I remember buying Whitehaven at AUD 1.12, I think, and it took us about three weeks to buy it because there was no volume in there. AUD 7, AUD 8, it becomes volume. Going back to that, people will overlook green issues if earnings are going well. It is a bit like that with WiseTech. Earnings are going down, and you have got the overhang of him. Ian has asked, "Do you hold any Australian oil and gas stocks? If not, are they on your radar?" Yeah. Woodside has been our preferred play for the past 18 months, I would say. We previously have held Santos. We dabble in and out of Santos, depending on the environment. As the geopolitical risks have flared up over the last year, Woodside was our default position. Ampol was our second position. Both we think are the highest quality oil and gas exposure in the ASX. On Woodside, they continue to deliver strong production performance from assets like Sangomar, in particular Sangomar, and we think we are really attracted to the growth that they have in some of their new projects. From a Santos perspective, the challenge there is they are ramping up two or three assets which have been delayed, and market expectations are a little bit aggressive, shall we say. For us, until we see full ramp-up of Barossa, and there was an announcement today about Pikka, which is its Alaskan asset, are hitting first production. Until we see a more robust production profile from both of those major assets of theirs, we'll give it a little bit of a wide berth. Woodside's our default position. At the end of the day, it's not so much about the companies, it's about the macro and where we think the oil price is going to go. As Matt pointed out, there is that increased geopolitical risk now presenting itself from the Ukraine and Russia. We still have the Iranian backdrop. If you take another level back, we've seen the dismantling of the OPEC alliance and almost every-man-for-themselves mentality when it comes to the reopening of oil markets. Everyone has balance sheets to repair. They're all going to come pretty hard from a production standpoint as those markets start to free up again. Then again, countries have to build up their inventories that they've used and depleted over the past six months. Oil markets are fairly challenged to pick directionally. We think at the AUD 80 level where it's at now, oil's probably heading back down to the 70s would probably be our. The low 70s is probably our best guess today, which means all those oil companies will come under pressure. In that environment, we think Woodside's balance sheet and its production is most insulated. I think also an important point to raise is their assets, where they're located. Yes. There was talk in the press, I'm not sure if it's got any substance, but Woodside would make a great acquisition because people want those assets. They're not Middle East. People want to contract because they know they get supply. For us, their assets are looking better and better. That's why we'll ride the oil prices on a fluctuate, like John said, because you've got the SPR versus OPEC trying to sell oil basically because they've been out of the market for a while. A bit of tension there. Our guess is oil down and then gradually grinds up if the global industrial production kicks up like it's doing at the moment, if that gets any more lick. I think the quality of the assets on a global scale are very attractive. We've got some more SPP questions coming through. Lance has asked, "With an SPP, there is a risk of scale back if oversubscribed. I haven't read the booklet in detail. Was a rights issue considered, please?" I'll say that, yeah, there is a risk of scale back- as with all SPPs. In terms of a rights issue, I guess I'd just comment that an SPP does have the benefit of the alternate pricing. So it can be the lower- Yeah. of the two prices, with the discount to the VWAP. I'd say that's probably a benefit for shareholders for an SPP. I'm not sure if you have any more comments. No, they are always up for discussion. I think it is just depending on the market and the size of WAM Leaders as well, being so big and forcing people to have the commitment with an entitlement versus an SPP, you have got the option. There are pros and cons of each, but you pretty well hit the points. Jay has asked, "If new shares issued under the SPP are immediately entitled to dividends funded from the existing profits reserve, is that fair to existing shareholders who have helped build that profits reserve? It is a good question. Ultimately, it is a subjective call. Is it fair? You could say the new shareholders get a free carry off the profit reserve that has been built, but because we have got so much in the kitty, I do not think it matters at the materiality point of view. So obviously the board consider all this when they do it, but I think it gets back to materiality. I do not think it really impacts the ability for the company to pay. You also get the benefit of raising if you are an existing shareholder and others are putting money in at a different price too, there is some benefit there. But I do not think materiality really kicks in for that. Worth mentioning maybe that SPP is obviously available to existing shareholders as well. And that the placement, a lot of shareholders that did participate in the placement- Yeah. sorry, were existing shareholders as well. Yeah. Correct. Yeah. Ian has asked, "Why were retail customers excluded from the recent placement?" Maybe I will just touch on as well that the placement is only available to professional and sophisticated shareholders, which is a limitation of the Corporations Act, actually. So we are constrained by that. That is the only way we can do a placement- Yeah. is by, yeah. That's why we do the SPP. Yeah. In theory, we don't have to do the SPP, but I think through the history of WAM, we've demonstrated we do look after the retail shareholders. So that's why the SPP is in place to look after those people that missed out. Yeah. Steve has asked, "Will you publish NTA and profits reserve figures that include the recent capital raising prior to 1 September so investors can make a fully informed decision regarding the SPP?" And I've got word from finance on this. Okay. Good. They said, "We won't be publishing an updated NTA after the issue of the placement shares, but the profits reserve will be about AUD 0.252 per share. Yeah. Okay. Thomas has asked, just on the SPP again, "Do you think the timing of the WAM Leaders share purchase plan and capital raising is optimal given it does coincide with some people that also own WMX?" He said he's allocated free capital to WMX- and couldn't find themselves strapped for capital to grow the position in WAM Leaders even if they wanted to. Yeah. It is a fair observation. For us, it is really the board's, in consultation with us, where we are excited about the period, so it is like we would love to time it so everyone had the ability, but we can see a real clear moment here that we need to get ahead of. So, that is why they were pushed out at the same time. Thank you. We have some more questions coming through. Garth has asked, "Do covered calls or shorts play any part in your mandate?" No, we do not do it. I am not sure if we can even do it. We cannot do covered calls, but we can short. Yeah, we can't do options. We could short, but we don't do it. We do it to hedge our deal risk. Yeah. Or placement stuff, but it's not a lever we lean on. We've tried it over the years. I think we're not very good at it. Markets like to go up. Yeah. Generally, companies, the management are always trying to sell the story. Yeah, the timing's really hard on short. For us, we think we've got enough levers where we don't need to do it, but we can do it. John has asked, "How many different companies would you typically hold at any point in time, and how long would you typically hold a particular stock? Well, during reporting season, we go quite broad, because you've got a lot of event risks. What we do during reporting season, which is now in August and in February, we generally push it out pretty wide. It can get to, like, 70-odd stocks. It goes pretty wide, and that's the strategy we do during reporting season. Then once you get all the information, we can press it back to our high-conviction bets. When I say high conviction, the portfolio might run in between 50 and 55 stocks, but the top 10 or top 20, call it, do all the heavy lifting. That's where all the performance comes from. There's a lot of stocks which are just, we call them incubation-type levels, where we don't have enough evidence to really swing the bat, because the probabilities aren't in our favor, so we're just monitoring them. But the top 20 really drive it. Within that, like, 70% of the top stocks we hold for over three years. The other point to make is, we, both John and I, pull the weights up and down pretty well every day if the facts change. We have a very dynamic weighting approach. Not only is stock count, but just the weights change a lot and I'd say, what would the, I'm just trying to guess here, maybe 10% of the portfolio, or probably 20% of the portfolio daily we'd be fine-tuning. It's very, very active. Got some more stock questions. Nick has asked, "In relation to the REIT sector, has the team looked at HealthCo Wellness REIT, HCW, considering the announcements disclosed to date on their health scope portfolio?" Yeah. It is just outside of our universe, but we have had a look at it from a Ramsay perspective. We thought there was a bit of an opportunity for Ramsay to accumulate a few of the assets that they would sell, and they managed to pick off one and looking at a couple of others, is my understanding. There is some value there, but it is a bit high on the risk curve for us, so we have left it alone. Yeah. One of the things we look for is liquidity in stocks as well, because we are so active, it is like when you have got no liquidity, you have got to be 100% right, because if you are wrong, it is incredibly painful, and for us, it is risk reward, we just cannot get there. Harry has asked, "What do you think about Transurban, TCL, compared to REITs?" Transurban is a tough one because it is very fully priced. Its earnings, it is fairly robust, but we have seen a period of volatility given oil price and those dynamics playing out. I think for us, the biggest challenge to get comfortable with Transurban is their growth strategy. They have articulated the cost out program. We still do not understand how they justify so many heads in that business, but they are trying to fix that. But their growth strategy is very much a U.S. or offshore-based growth strategy, which is going to require a lot of capital. So for us, we think it is not cheap, it is not expensive, it is just dead money for a while. Because if they do embark on further growth ambitions in the U.S., it is going to come at capital risk raising. They're going to deploy, there's going to be dilution, there's going to be people who aren't going to be too happy about the diversification from Australia. For us, it's a bit of no man's land. The most recent deal they did with the New South Wales government, it's a bit of a give of the left and take with the right. It doesn't really change the value of the business. They give up some short-term earnings and get a little bit more at the tail end around the ability to participate more in more toll roads going forward. It's fine, it's boring, but we don't really like where they're going to go from their growth perspective. I think once the Melbourne one comes online, we'll start to get interested. We're probably warming to it because they're sort of going through the journey now, but as John said, it's a little bit in no man's land, but the Victorian side will eventually be a of their toll road will be a catalyst. Maybe we'll fly through some stock questions. Yep. Yep. APE is APE. We actually don't mind that. I think as we start to shift more and more towards EVs, I think their growth strategies in Canada will take a little bit longer than what people expect, but from a fundamental standpoint, it looks good. Sonic Healthcare, SHL. Oh. We bought a tiny bit of this one. Don't love it, but it's very, very cheap and some of their peers are going okay. So it's a very small position, but we're a little bit hesitant on this one. Yeah. But it is a tactical trade in reporting season for us. The big thing to watch with this one is if they divest their U.S. business or if they even talk about divesting some of their what we consider core to become non-core. So if they divested that U.S. business and got a big wad of cash in the door, you could see rapid re-rates. So hence why we are hedging that out. CSL. I touched on it earlier. We want to see new management, think that the earnings risk is still there. Still a little too early for us, but got two eyes on it. Does WAM Leaders invest in other listed managers? What about GQG? No. With low PE multiple and strong yields? No. No, generally not. No, we had a bit of AMP, but not really our forte. APA Group, specifically thoughts on future performance given the government's attitude to fossil fuels. It's been a great performer. We sold out of APA probably about six months ago, and it kept going on with it. In the mid-10s, it's probably a fair value. If you think interest rates are going to fall, it's got a nice carry there. You're getting paid to hold it. For us, it's an interest rate directional bet. We put a little bit back in the other day, just a tiny bit, but their outlook is actually pretty good. I think the debate around fossil fuels has got better, not worse. It was a concern and it's actually got better because of this shortage of energy, and concerns around everyone running all these data centers and all that. The attitude's got better. For us, it's just a small position, interest rate directional bet for us. Specific REITs. Nava said you've mentioned A- REITs, which ones, I suppose, do you like, SGP, GPT or Goodman Group? Yeah, it's a tough one. We break REITs up into cash rate REITs, which are like the resi developers, so very much around the floating mortgage rates, and then you've got the cap rate REITs, which are around valuations. We have all of them. We've got the Mirvac, S tockland because they're on absolute depressed valuations because people think, quite rightly so, that housing is slowing. The good thing is the policy doesn't really affect them on the new homes. We think they will be a beneficiary in this reporting season, and we think ultimately the cash rate will come down. So they'll be a place where money flows back to. On the cap rate side, we've got quite a few, GPT, Charter Hall, SCG is another cap rate play. They're the main ones. Goodman Group, it's another tactical one. We move up and down with sentiment on data centers. Data centers are on the nose again. We've pulled down our weight, and it's a very tactical trading one. We like Goodman Group. We like management, we like the incentive structures, all smart people working for the same goal. We quite like that one. The only, the patience in the market for Goodman Group is wearing thin, I'd say, because there's a lot of expectation built up around the data center rollout. The thing about data centers, they take a lot of time to get the revenue through the door. People's patience for it is, they're waiting for big announcements, and they haven't come. They're definitely coming on the horizon, but it's just that, how long can you wait? Life360, Colin said, "Does the drop in its share price today speak to you re your current sentiment on growth first value stocks?" It's an interesting one because if you were at our desk this morning, you could hear the various debates around the result. I think initial response was it beat on a lot of the metrics that the Australian investors look at, and that's just simplify and call it users, but some of the metrics that the U.S. investors look at, it missed on. So I think it's migrated from a market favorite to a battleground stock because it fits in that software camp. The initial flag down 25% was a little bit ridiculous. Down 8%-10%, I don't actually know where it is right now. It's fine, I'd say. We're not going to run out of the room and go buy it right now. It's done very well. We've had it in the portfolio. We've been reducing it. It's something that we've got to go and do a bit more work on. 4DX, 4DMedical, that might be more for the- Yeah, just- No, well, it appears on our. Because we break the Australian market up into different factors, just for observation and any intel, and 4DX always comes up number one momentum stock in Australia, and we actually don't really know what it does, because it's very low quality, in my view, when I look at the balance sheet and income statement. But it's a number one momentum-rated stock in Australia, and you can see the stock performance up and down 10%. It's crazy, but yeah, not one for us. AGL or Origin? Yeah, tough space. Both in a real tough bind at the moment, given what energy markets are doing. The forward curve, which is the price of energy over the next two years, is in backwardation, which isn't very good for their earnings fundamentally. From that perspective, we need to see a shift in what's happening for Loy Yang or for a few of the other coal-based power plants in the country to see if that forward curve moves. For us, the results will probably both be fine. Expectations are really, really low, but it's what happens to earnings in FY 2027 and FY 2028. You got a drop of 20%-30% for AGL's earnings out there and potentially same impacts for Origin. We want to like them because ultimately, data centers will consume a lot of that energy. But yeah, we can't get there right now. I think the mix of green as well with the higher D&A and- Yeah. it's just really messing their accounts up as well. Yeah. It's- Yeah. very negative in the space. Yeah. We also had someone ask a question for the wool webinar, but it's actually more relevant for you both. Yeah. Views on Ampol and Viva. Yeah, Ampol has been a massive beneficiary of what has taken place geopolitically. The earnings it delivered in its quarterly update is more than most people had anticipated for the year. Don't quote me on that, but it is just to provide you some context. So its balance sheet is repaired, its strategy is great. It has done very well. The spread from purchased oil to refined oil has been as elevated as it has been for some long time. So its margin profile is great, but they have to comp these numbers next year. So our concern is their ability to continue to generate the earnings that they are generating today. So we still hold Ampol. We have reduced it around that AUD 40 level from 2% of the portfolio to about 75 basis points down as we stand today. Viva, on the other hand, doesn't pass the quality filter. They have some issues at the retail side of things. We are not so convinced around their CapEx strategy for their petrol station rollout. They are spending, again, it is around AUD 4 million a petrol station, whilst Ampol spends about AUD 1.2 million. So for us, there is a clear distinction between the two, and the only way we will play it is via Ampol. Breville, BRG? Crowd favorite, that one. We were doing a little survey over the last couple of weeks trying to find where positioning is from a small cap perspective, and every small- to mid-cap broker and research house we spoke to, Breville was their top pick. So for us, that is normally a signal that expectations are elevated. It is back to all-time highs. We don't think that they won't deliver. It is just the expectations are a bit too high and the risk/reward doesn't stack up. High-quality business, probably goes on with it, but not for us. Suncorp Group, SUN? We are quite negative on the insurance space. More so SUN than IAG, but yeah, we do not own it. We have got a tiny bit- Yeah. residual left over, which might go. For us, the insurance space premium rates are under pressure. It is just not a good place to be at the moment. The whole sector, it is not just a company issue, it is a sector issue. For us, we are very underweight. The insurance space, which throughout history, I remember when we were 7% of the fund was in IAG at- low AUD 4, I think it was, around COVID, and now it is doubled. So you have had a rerate, and then the premium- Yeah. cycle's rolling over, so an avoid. Infratil, IFT? It's in the Goodman, NEXTDC camp. It's a victim of its own success, I'd say. The contract announcement that they came out with, I can't remember the exact number around how many gigawatts or megawatts of power of data they're going to do. People, it was that big a number, no one believed it. Then you start to think through your head, what's the CapEx requirements? How long until they get a return profile? The thing about NEXTDC and Infratil is they're very capital-intensive businesses, and as they grow, they need to come back to some source of funding, and typically that's equity markets. They've tried to go down bond markets, they've tried to go down debt markets, and NEXTDC's probably had a little bit more success than Infratil. I think long-term, both are great businesses, but the capital intensity just scares us off a little. We've got some questions on, again, how you want to deploy the capital raised through the SPP. Ashok has asked that, "Where do you plan to deploy the funds?" Cathy has asked, "For me as a shareholder considering increasing my holding through the SPP, sounds like you, Matt, and John are bullish on the market and opportunities." Look, I think, Ashok, we won't give you the exact day and time and names that we're going to buy. I think we've given you some context around how we feel about markets. It's certainly not going to be around the top 10. I can't see us deploying money into CBA or Westpac, NAB, or ANZ, that's for sure. It's that next level down where if we see opportunities over the next month or two, particularly in a few of the names that we've called out in the sectors that we like using that thematic around rate cuts in the Australian markets, continuing strength in the U.S. markets. We like lithium, we like gold. There's a variety of ways that we will deploy it, and we'll be very selective, and we'll always remain disciplined to pricing, and our process. Watch this space, I'd say. Around the second question around bullishness of markets, I think we've earlier mentioned, I can't see the ASX running away to 10,000 or 11,000 because that needs to be led by the ASX 20 to do that. We think markets broadly in Australia will remain flat to down, but it's that next layer down or the next level down where we'll drive our performance. Question from George on coal. "Given big cap coal miner Glencore is looking to list on the ASX, would you consider investing, depending on valuation, or do you believe coal companies will still be out of favor from Australian superannuation funds and other investors?" To take that second question first, you look at who Whitehaven Coal's largest shareholder today, and that's AustralianSuper. I think that stigma around investing in coal companies has dissipated a lot. Around Glencore, it's a little misnomer that it's a coal company. It's a diversified miner, and it's an incredibly strong trading house and probably one of the more entrepreneurial businesses that you'll meet. We really love that management team. If you compare how dynamic and robust that management team is, and I'm probably in trouble for saying this, versus BHP and Rio who are incredibly rigid, incredibly structured, incredibly prepared, who know supply chains down to the third, fifth, sixth level down. They do that for a reason, because they never want to get things wrong. It takes a little bit of the entrepreneurial spirit out of the business. What we can get from Glencore, and we really welcome that into the ASX, is they know how to drive and dictate profitability. They don't chase volume, they try to chase profitability, and they want to control markets. When they come to Australia, I think it's going to be really interesting to compare how Glencore is run versus a Fortescue, how Glencore is run versus BHP and a Rio. I think it's going to be an eye-opening experience. I think BHP and Rio are completely robust, but I think the one that might suffer the most is Fortescue. Spark NZ, are you still holding it, SPK? No, we're out of that one. The New Zealand economy, I think had green shoots and then fill in a hole, then green shoots, fill in a hole, and now it's back in a hole. For us, we exited Spark. Sometime, yeah. Yeah, it was a long time ago, just because the headwinds are too much. Guo has asked, "Is there a bubble in U.S. AI stocks, and how will it affect Australian equities? That's a question no one knows the answer to. Yeah. So unresolved. What is our view? We definitely were in a speculative bubble when the heat tried to come out of it a few times. So in January, before the conflict, it had its first go. Then during the conflict, it will see another go. And then just recently, it had another go. And normally you get three or four warning shots before it collapses. We are not calling for a collapse, but there is a lot of unresolved questions, and the only thing I would say is capital markets have to remain open for everything to work. And capital markets, I mean equity and debt markets. So far, both are open. When you look at stress in this sector, like hyperscale of debt in the U.S., and spreads are starting to blow out. Is the capital market going to close the door? It is a live debate. It is looking worse and worse every month we go on. Is it a bubble? We will tell you after the event. But the signs are not great from a trading perspective. We are not really trading that space. We trade the macro around that space. Whatever happens will have implications to rates and spreads, and we will trade the derivatives of that. We will not actually be directly involved in it. If it blows up, we do not care. Yeah. If it does, it would be great from a performance point of view for us, but it does not really drive down the market. But a lot of unresolved questions, and because the economics are unknown, we can all have guesses, but everyone is guessing. But the capital market is showing you that, hang on, we might have a problem here. Your economics, are you going to pay your debt back? And that is where you are seeing spreads now creeping and creeping out, as people are worried about can you pay back all this money you are spending? On the impacts on the Australian market, perversely, I call it the KOSPI Casino, which is the Korean stock market. The amount of speculation and leverage in that market has come at the expense of the Australian market, where a lot of money's been pulled regionally out of Australia and put into that market. As I highlighted earlier, around the MSCI and the MSCI index, we have seven constituents out of 47 being removed, and the vast majority that are going into that index are Korean stocks. If we see a blowup in the KOSPI or in the AI thematic, a lot of those Australian names that have been negatively impacted, we get a tailwind. That's one little thing that we're watching carefully. Just for context as well, when you've been investing for a while, you remember similar rents, and one was 1995, 1996, where Korea went through the same event. There was a boom in DRAM, was called back in the day, which was memory for personal computers, basically, as everyone was buying laptops and personal computers took off. What happened? Korea went on a massive CapEx boom to build supply for that. Then demand started to roll off and price fell 50% one year, and then, I can't remember, 60% the other year, and the whole market blew up. What's happening now? There's a demand shortage, demand pulled forward, and everyone's building supply. We do have the ingredients. We can't say it's going to happen the same way, but it looks eerily similar to 1995, 1996, 1997, when you build out this massive CapEx program to build out supply, and then the demand picture changes. We do have the ingredients for a bubble and a bust, but we're not quite there yet. Got a few more questions from Nava. What is your interest rate forecast? When I hear that question, I am like, where? Like the cash rate? Or there is quite important, probably the cash rate is what she is referring to. Again, over what period? Basically, we think they are on hold for. The debate is pretty a moot point. Are they on hold for the rest of the year, or do they hike once? I think that is missing the argument. I think everyone is signaling now we could be in a cutting cycle in 2027. For us, moot point, one more. Note on hold, it does not matter. Our forecast is no change this meeting. The next meeting would be no change. Then we are of the view, no changes, and then cuts. Other people think one more, but again, it does not really matter. One more hike, that is. WAM Leaders' performance was somewhat distracted by the WAM Leaders' wholesale fund. I would like to know how confident you are that you can lift the performance of WAM Leaders. I would love to give an excuse that was the reason why, but that was not the reason why. We went for a big pivot. We had three massive years of outperformance, and we went for almost a deep value play because we thought we got the direction right on the interest rates. But the market went from value to momentum, and we got caught out on a lot of deep value, and we stuck with those for too long. Then in the interim, you had all the passive flows, which we talked about, push up all the top 20. So we got hit two directions. Yeah. It was an error on our part. It wasn't the fund. I wish we could lay blame on, "Hey, that was a distraction." It wasn't. It was bad calls by us. We've adjusted our model. We do take flows much more into account now because it dominoed fundamentals. That's the error we got. We were leaning on fundamentals too much, and arguably, you could say that's a good reason to get wrong. It wasn't like we just were investing in silly companies. It was like we were leaning on valuation too much to the momentum, and momentum dominated. Then we did a lot of back work around why momentum worked, and it was around financial plumbing, and a whole lot of reasons were built into our forecast now. Yeah. We shouldn't get caught up on that again. That was a positioning error on our part, and we've fixed. The beauty of WAM Leaders is its iterative process. We started, John and I started, two people, brand-new fund. We had an idea of the process, and each year we iterate, and that was a great learning period, and we've learned from that, and we've fixed those errors, and that's why you can see banks in our top 20 in July, is part of that iteration of that process. We lean into that now. Before, we were still into that, but we were like, "Okay, there's a seasonal period here. There's inflows, there's passive money coming, there's KOSPI blowing up. Money we'll get to redeploy." We learned from it, and we outperformed in July. That's just how the process works. Campbell is asking, "Talk to the impact on the share price due to dilution, the dilution effect of the capital raising, the placement and the SPP. Will the issue of further shares dilute the return on capital, e.g., biannual dividend?" We have touched on- Yeah. a little bit, but may be worth clarifying dilution. Yesterday, I think five million went through. Today, the share price was up last time I checked, so it felt like it cleared. Really heavy volume on that day one, so largely, I think the selling's done because you had a bit of a rebound today. So it looks like that's done. Will there be another round? I am not sure. Through the SPP, I highly doubt it. It is more of the placement stock. I think from what we see today, it looks like it cleared. Maybe also on dilution that we at WAM always raise at NTA or above- Yeah, correct. which also helps to not dilute it on an NTA per share basis. That is correct. Yeah. Garth has asked, "I understand all your reasons for raising capital. At the end of these two capital raises, WAM Leaders will have a market cap in excess of AUD 2 billion. As your market rises, your fees rise as well as a percentage. Percentage stays the same. Any possibility the board would consider a reduction in the MER and fees? Yeah, that is something totally outside of our control. Just judging by the history of WAM, I do not think we have reduced the fees. I do not think it is an active discussion, to be frank, but again, it is totally something out of our hands. Reese has asked which ASX stocks are going to get excluded from the MSCI, the MSCI. It is, okay, Stockland, Mirvac, Cochlear, WiseTech, Xero, Sonic Healthcare. I am forgetting one. ASX. The A7. I am very impressed with your memory. Ian has asked, "How is WAM Leaders seeking to benefit from the transition to renewable energy?" Spoken about data centers a lot as well. Yeah. It's not something we can direct. Lithium, you could say lithium, but the way we view resources, we view resources as tactical trades. And what I mean by that is we go in and out of those, based off commodities are inherently cyclical. So lithium is, I guess, one- Yeah. aspect of the green, and maybe- Rare bit, rare BHP from a copper perspective. Yeah. If you want to think of copper as green. Yeah. Iluka, rare earth with magnets and- Electrification, yeah. They do have the weapons, which maybe counteracts the green angle there. It is hard for us in a big liquid firm to be participating in the smaller speculative areas. But the big miners, like John said, participate in it, and lithium, if you want to call that green, through EVs and battery storage. Got just a handful of questions left to go. George, "Are you able to invest in an IPO if the stock is predicted to enter the ASX200?" Yeah. If it's got a pathway into the 200 from a liquidity standpoint, earning standpoint, we do have that flexibility to go beyond. Yep. Campbell's asked thoughts on Woodside, WDS. I think we touched on that. Nice. Positive. Yep. Yep. Great. Yep. Easy. The last one from Steven, "Why do you prefer Coles over Woolworths? Oh, it's a constant battle. It's a week by week. Both John and I have kids that Woolworths have been the death of us over the past month. I think I've been to Woolworths six times- Yeah. in the last seven days. We like Woolworths now. It's good marketing. Yeah, great marketing. Because they were getting a bit redundant the specials, but this one has really hit home. It is really, again, we just get feedback from suppliers, who is winning share. We just adjust the weights and valuation. So it is very complex, and I think during the year, we might shift Woolworths and Coles up and down leadership-wise five, seven times throughout the year. So it is really based off feedback we are getting throughout the year. If you went back six weeks ago, Woolworths was in our top 20. It was a turnaround story that turned around really quickly- and hit that AUD 40 mark, and that was fairly full for us. Momentum is right there right now for Woolworths, so we expect the result to really shine from a Woolworths perspective. But again, it comes down to how their ability to comp these numbers. Are they going to be able to repeat it? Is it a pull forward? And our only concern really for a Coles perspective is the liquor side of the business. We think the liquor retailing is a tough market. We think Endeavour will have to come at a price perspective. It is going to be priced down, is the only way to regain momentum in that space. So that is what is holding us back from going higher in Coles. Yeah. But just going to Woolworths, it is going to be a great test of fundamentals versus momentum, because at AUD 40, Woolworths looks expensive, but will the earnings momentum drive it higher? So again, these are the feedback loops we are always looking at. Which will win the battle of the day, and we are going to get a great example of that shortly. All right. Thank you to everyone for asking questions, and thank you very much for answering them as well, Matt and John. That is all we have time for today. To stay informed with our latest investment insights, please join our community of more than 100,000 subscribers. You can also follow us on social media platforms. If you have any questions relating to the share purchase plan, please do not hesitate to call or email using the contact details on our website. A recording of the webinar will be made available on the website shortly as well. I will pass back to Matt for any closing remarks. Thanks, April, and thanks for everyone for joining us today. I just like to reiterate the great support from everyone over the decade, and we are very excited about the period we are entering. We had a great year last year. We are hoping to compound that again. But just thank you, everyone, and we will look forward to the next decade. Thank you.