Good morning, ladies and gentlemen. Welcome to ST Engineering's full year 2022 results briefing. We will begin today's briefing with a presentation by our Group Treasurer, Colin Teo. Colin is presenting on behalf of our Group CFO, Cedric Foo, who is not well today. Following the presentation, our Group President and CEO, Vincent Chong, will give his remarks. After that, we will open up the floor to a 30-minute Q&A session. Without further ado, may I invite Colin to give his presentation, please. Thank you, Sihuan. Good morning to everyone here in person, as well as those joining via webcast. Welcome to ST Engineering full year 2022 results briefing. Moving to slide two. I would like to bring your attention to this slide, which states that a group's actual future performance, outcomes, and results may differ materially from those expressed in forward-looking statements. Moving to slide three. This slide shows the agenda for today. I'll be covering the group highlights, productivity metrics, debt profile, dividends, and outlook, followed by a Q&A session. I'll move on next to group highlights and starting on slide five. In FY 2022, amidst the challenging operating environment, the group recorded a good set of results. Group revenue was SGD 9 billion or 17% higher year-on-year. The group's earnings before interest and tax, or EBIT, of SGD 735 million was 9% higher year-on-year, despite SGD 203 million reduction in government support. Our profit before tax, or PBT, and net profit stood at SGD 597 million and SGD 535 million respectively. Both are 6% lower year-on-year. In 2022, we incurred interest expense to finance the acquisition of TransCore. TransCore is already cashflow positive in 2022 as planned. We expect TransCore to be earnings accretive from the second year of acquisition. In the second half of 2022, the group posted strong double-digit year-on-year growth in both revenue and EBIT of 18% and 10% respectively. PBT and net profit was 17% and 7% lower year-on-year respectively. Turning to slide six. Over the past three years, the group has emerged strongly from COVID. Looking at the middle chart on this slide, in 2020, our group EBIT would have been SGD 243 million without government support. In 2022, we received virtually no COVID-19 government support, yet our group EBIT was SGD 733 million, a significant improvement. Likewise, net profit would have been higher compared to 2022 and 2021 if we excluded COVID-19 government support. Moving to slide seven. This slide analyzes the year-on-year increase in group revenue by segment. The group recorded an increase of 17% in revenue in FY 2022. This increase was contributed by all segments, namely Commercial Aerospace, Urban Solutions & Satcom, and Defence & Public Security. Slide eight. In FY 2022, Commercial Aerospace contributed 33% of group revenue, Urban Solutions & Satcom 20%, and Defence & Public Security 47%. For revenue breakdown by types of product and service, commercial revenue increased from SGD 4.6 billion in 2020 to SGD 4.8 billion in 2021, and to SGD 6 billion in 2022. Defence revenue grew steadily from SGD 2.6 billion to SGD 2.9 billion and to SGD 3 billion over the same period. As you can see, the diversity of our business portfolio has helped us to reduce the volatility of our financial results and will cushion us from future pandemics as well as recessions. For revenue breakdown by customer location, Asia constituted 50%, U.S. 25%, Europe 18%, and Others 7%. Moving to slide eight. In 2022, Commercial Aerospace revenue recorded almost SGD 3 billion revenue, which is a very strong 21% increase when compared to 2021, even though the aviation sector has yet to recover fully. We'll elaborate on this point further in the next slide. Additionally, we are pleased to inform that passenger- to- freighter or P2F's gross profit margin at program level turned positive in fourth quarter of 2022. Slide 10. In the month of December 2022, air travel has recovered to 77% of December 2019, which represents pre-COVID level. Of this 77%, domestic travel leads at 80%, whilst international travel lags at 75%. International travel with wide-body aircraft generally provides more MRO workload. Asia-Pac international air travel is now at 52%, which clearly indicates room for recovery in Asia Pacific, which is our key Commercial Aerospace market. The reopening of China is an upside for this segment. We have recently announced the setting up of a joint venture with SF Airlines. This JV is subject to regulatory approvals and its airframe MRO facility will be located in Ezhou, Hubei. SF Airlines is the largest air freight carrier with 79 aircraft in their fleet and growing. Our Commercial Aerospace unit will have 60% share, whilst SF 40%. SF will become the anchor customer, this facility will enjoy incentives from the local government. We expect further growth in this segment as the industry recovers. Turning to slide 11. The chart here shows the group EBIT and base operating performance or BOP in short. Base operating performance excludes the following: COVID-related government support, energy inflation, TransCore transaction and integration expense or TC T&I in short, as well as pension cost savings which was a positive impact. Our BOP EBIT improved from SGD 469 million in FY 2021 to SGD 727 million in FY 2022, an increase of 55% year-on-year. Group EBIT, as reported, grew from SGD 674 million in FY 2021 to SGD 735 million in FY 2022, an increase of 9% year-on-year. This was a result of SGD 258 million of business growth and cost savings, which excludes pension cost savings, and this more than offset the SGD 203 million reduction in government support. Slide 12. For Commercial Aerospace, EBIT grew strongly from SGD 182 million in FY 2021 to SGD 301 million in FY 2022, which grew by 65% despite the drop in SGD 150 million of government support. Slide 13 on USS. The USS EBIT grew from SGD 26 million in FY 2021 to SGD 29 million in FY 2022 or 13% year-on-year, despite the TransCore T&I expenses and Satcom's product development investment. Chip shortage impact is about SGD 20 million for both 2022 and 2021. Moving to Slide 14. EPS EBIT dropped from SGD 466 million in FY 2021 to SGD 405 million in FY 2022 by 13% year-on-year. However, if we exclude the drop in government support of SGD 51 million in 2021 and the impact from energy inflation of SGD 23 million, the base operating performance EBIT would be SGD 428 million, which is 3% higher. Looking forward, since the U.S. Marine business has been divested, future losses and risks from this line of business have been eliminated. Turning to slide 15 on the group's net profit. The BOP net profit improved from SGD 394 million in FY 2021 to SGD 549 million in FY 2022, an increase of 39% year-on-year. Net profit dropped from SGD 571 million in FY 2021 to SGD 535 million in FY 2022 on a reported basis or 6% drop year-on-year. The improvement in our BOP net profit was a result of SGD 258 million of business growth and cost savings, which excludes the pension cost savings that more than offset the SGD 203 million reduction in government support. As TransCore will only be earnings accretive in the second year of acquisition, this increase in EBIT was not sufficient to fully offset the higher finance costs and other factors shown here. Turning to slide 16 on our new contracts. In the fourth quarter of 2022, the group secured SGD 2.8 billion worth of new contracts, with SGD 0.7 billion from Commercial Aerospace, SGD 1.4 billion from Urban Solutions & Satcom, and SGD 0.7 billion from Defence & Public Security. This brings the total new contract value for the year 2022 to SGD 13.1 billion. Slide 17. The group ended the year with a robust order book balance of SGD 23 billion. This represents a 31% increase from SGD 17.5 billion, which excluded the U.S. Marine business as at the end of 2021. This is also higher than 2019 pre-COVID of SGD 15.3 billion order book. About SGD 7.2 billion of the SGD 23 billion order book is expected to be delivered in 2023. This strong order book provides visibility for future revenue in the coming periods. Next, I'll move on to our productivity metrics, and starting with slide 19. Our productivity metrics are trending well. Firstly, ratio for operating expenses over revenue improved from 13.5% in 2020 to 11.7% in 2022. Secondly, ratio for staff costs over revenue improved from 32.5% in 2020 to 28.9% in 2022. These two ratios are also more favorable than those that we achieved in 2019 pre-COVID. We had cost savings of around SGD 250 million in 2022, including the pension cost saving in Commercial Aerospace. This enable us to offset the reduction in government support of around SGD 200 million and to invest in our growth areas. I move on to our debt profile, and turning to slide 21. For our interest rate debt profile, 53% is on fixed rates and 47% on floating rates as at the end of December 2022. This is in accordance with our hedging policy of about 50% in fixed rates, which is a balanced approach to achieve an effective hedge and avoid undue speculation on interest rate movements. The group's weighted average borrowing cost for FY 2022 was 2.4%. A marginal increase compared to 2.3% in 2021. The weighted average borrowing cost of our existing fixed rate borrowings, which is the darker blue portion of the pie chart shown here, comprising mainly bonds, lease obligations, and fixed rate loans, is around mid 2%. As informed previously, there are $32 million of treasury lock-ins remaining in our hedging reserves. This will reduce the interest rate for our next fixed rate debt issuance, and we have planned for about $500 million. For 2023, we expect the group's weighted average borrowing cost to be in the low 3% range. Assuming even if U.S. Fed funds rate increases by up to 100 basis points over the next 3 to 4 FOMC meetings from 4.5% to 4.75% range to peak at 5.5% to 5.75% range in the second half of 2023. Our credit ratings remain very strong with AAA by Moody's and AA+ by S&P. Most recently, Moody's has just reaffirmed this rating on the 21st of February 2023. Next, I move on to dividends, turning to slide 23. The Board has recommended a final dividend of SGD 0.04 for ordinary share, subject to the shareholders' approval at the upcoming AGM in April 2023. If so approved, the final dividend will be paid to shareholders on 9th of May 2023. For the first three quarters of 2022, we have paid three interim dividends of SGD 0.04 each, making a total of SGD 0.12. The total dividend for the year ended 31st December 2022 will be SGD 0.16 per share. I'll move on to the outlook for the group, and turning to slide 25. The group is well-positioned for the future. We will ride the recovery in the aviation industry. Our P2F gross profit margin at program level is expected to improve. We will continue to focus on productivity initiatives, including monitoring the OpEx- to- revenue ratio. Thirdly, TransCore's transition has been smooth. It became cash flow positive in 2022. There was also good contract win momentum. We expect this investment to be earnings accretive in the second year of acquisition. Fourth, we will continue to manage our portfolio. Last but not least, a robust order book of SGD 23 billion that will provide revenue visibility in the years ahead. Turning to slide 26. Okay, this slide shows our Group P&CEO's message on our outlook. I'll just give everybody a minute or so to read through. All right. This brings me to the end of my presentation. Thank you for your kind attention. Thank you. Thank you, Colin. May I now invite our panelists to the head table. The panelists this morning are Vincent Chong, Group President and CEO. Ravinder Singh, Group COO, Technology and Innovation, and President, Defence & Public Security. Tan Lee Chew, President, Commercial. Joining the ExCo members at the panel are Jeffrey Lam, President of Commercial Aerospace, and Colin Teo, Group Treasurer. I will now hand over the floor to Vincent to deliver his remarks. Vincent, please. Good morning. Good morning to you. Those of you who joined us at ST Engineering Hub and also participants who are joining us virtually, a very good morning. Welcome to ST Engineering's financial results briefing for second half of full year and full year of 2022. Looking back at 2022, many of us will agree that it was a year of growth and also challenges. The global economy continued to recover from the COVID-19 pandemic and amidst the reopening, factors such as high inflation, supply chain disruption, including chip shortages and geopolitical tensions, continue to create uncertainty globally. ST Engineering benefited from the recovery from the pandemic, especially for our commercial aerospace business. We were also impacted by the global challenges which I've just described. These were factors that we have been highlighting in our past briefings. Overall, we are pleased with our full- year results. We've a strong recovery in our underlying performance as Colin has presented earlier on, despite the challenging operating environment and virtual absence of COVID-related government support to a tune of SGD 203 million. That said, from the trough of the COVID pandemic in 2020, we have made good progress to deliver against our five-year plan and targets that we communicated at our 2021 Investor Day. Significant highlights for us include the acquisition of TransCore, and that this investment turned cash flow positive per our investment case in 2022, and we expect it to be earnings accretive from 2nd year of acquisition as planned. Our passenger- to- freighter conversion business continued to receive new orders, and it turned gross profit margin positive at the program level last year, as learning curve improved across conversion sites. In 4th quarter, we turned gross profit margin positive. We gained traction for international defence business in the Middle East. You would have seen our announcements last year. We continued to high-grade our portfolio from the divestment of our loss-making U.S. Marine business. The losses and risks relating to the U.S. Marine business have been eliminated post-divestment. Looking at the recovery from 2020 to 2022, Colin had highlighted that our revenue has grown and our base operating performance has improved. For both EBIT and net profit after tax, the performance underlying or base operating performance has tripled in 2022 compared to 2020, as the charts have shown earlier on. I would add that this recovery is significant given then that more than 40% of our business in terms of revenue, including Commercial Aerospace and Satellite Communication, is directly and negatively impacted by the pandemic in the last few years. Moreover, global issues such as chip shortages and energy inflation, though not material to the group by each factor alone when combined, affected or impacted our profit margins. We have shown the impact on the slides earlier on. We continue to carry TransCore's transaction and integration costs, as also quantified in the slide earlier on. The integration costs will continue to impact us for another couple of years, albeit at a lower level compared to 2022. Our continuous focus on cost savings has been a significant mitigating factor to counter the sharp reduction of government support and enable investments in new growth areas. Before going into our full year 2022 results, I want to address a common question on what else is next after the divestment of our U.S. Marine business. As we have elaborated before, portfolio optimization is a continuous process, taking into account our long-term view of businesses. As the operating environment for each line of business evolves, we will continue to prioritize businesses that play to our strengths and are attractive and are scalable. As part of our portfolio evaluation, we wound down our Autonomous Bus unit at the end of 2022, and we fully redeployed our talents to other business units to pursue growth, while at the same time meet recruiting needs of those business units. We have shown this as one of the bullet points in the slides which Colin presented earlier on. We still firmly believe that autonomous buses are closer to being commercialized compared to other types of autonomous vehicles. The business needs are evident, and the path to reaching the required level of performance are also better known and more attainable. While we have made extensive and considerable technological progress for our AV Bus, there are still technical and operational milestones to be reached. The financial resources needed for these continuing efforts are significant, estimated at more than SGD 150 million in the next five to seven years. After careful evaluation, we decided to withdraw from further AV bus development. As a group very much focused on technology and innovation, we constantly look for opportunities to develop cutting-edge technologies to solve real world problems, as in the case of AV bus. However, we are also disciplined in withdrawing from projects when the financial conditions are no longer conducive for further investments. Additional capital employed, including CapEx needed for AV Bus for this close business and that of the divested U.S. Marine business will be avoided, enabling us to plow our capital into other core and growth areas. Moving on to our 2022 results compared to prior group revenue increased 17% to SGD 9 billion with growth from all of our business segments. Group EBIT improved 9% to SGD 735 million despite the reduction of about SGD 200 million in COVID-related government support. As you know, we receive virtually no such government support in 2022. On a base operating performance basis, and that is excluding the COVID- related government support, energy inflation impact and TransCore transaction and integration expenses, as well as the positive impact of pension cost savings. If we exclude these factors, Group EBIT would have been 55% stronger compared to 2021. This result was achieved through cost saving initiatives and business growth. Reported group PBT and group net profit were SGD 597 million and SGD 535 million respectively. On a base operating performance basis, PBT and net profit each grew by close to 40%, with cost savings initiatives and business growth offsetting the reduction in government grant related COVID. Now let's turn to our business segments year-over-year performance. Commercial Aerospace revenue was up 21%, even as the aviation industry has yet to recover to pre-COVID level, as Colin explained. Its EBIT grew 65% despite a $150 million reduction in government support, but helped by cost savings initiatives. This segment has benefited from the recovery in aviation, albeit with some lag, in that there's generally a lag in MRO recovery compared to what the airlines are experiencing. you know, it just takes a while before the full impact is felt, but we are already benefiting from the recovery. This lag generally happens both on the upside and downside. As we already saw at the beginning of COVID, it took a while for our businesses to be impacted, you know, a little later after the airlines got impacted. On the way up, the same phenomenon applies. Returning MRO demand was reflected in the healthy utilization rate of all our facilities, which maintained on average an above 80% rate in 2022, with the airframe hangars operating mostly at near full capacity in 2022. This is a point that we have shared with you for a while now. We expect to see further recovery in aviation, especially in the Asia Pacific region, which is still now at the end of last year at 52% of pre-COVID level. The reopening of China will present more opportunities for the group. To capture the strong underlying growth in China, as Colin mentioned, we have announced for Commercial Aerospace a joint venture agreement with SF Airlines. It's Shun Feng Airlines, China's largest air freight, freighter airline in fleet size, to set up an airframe MRO facility in Ezhou to operate a greenfield airframe MRO facility at the Ezhou Huahu Airport, which is designated as Hubei's international logistics hub airport. Besides supporting the freighter MRO demands of SF Airlines, the joint venture will also serve the increasing needs of other cargo and passenger airlines operating in the region. We have a base customer, an anchor customer now, setting the MRO up for good success over and above SF Airlines work. We will be taking on other commercial airline as well as cargo airline business. Additionally, we started operating a second aircraft maintenance hangar at the Pensacola International Airport, Florida, USA earlier this year. It was in January. We're now better positioned to capture opportunities brought about by the fast recovering air travel industry because we did not pull back on our in-plan investment even during the trough of the pandemic. We broke ground on the second hangar, as you would recall. Now it's operating, and we'll be able to capture those new demands. More hangars are being built in the Pensacola complex, as you are aware. Our A320neo program production rate is in line with Airbus requirement, which is to increase to about 50 a month by end of 2022 from 45 a month at the end of 2021. Pre-pandemic level is close to about 60, as those of you would recall. Airbus targets to increase based on their media announcement, increase its A350 production rate from the current six per month to nine A350s per month by the end of 2025. That also bodes well for our EFW composite floor panel production business. As you know, for A320neo, we're making the nacelles for them. As they ramp up A320neo production, we will benefit from that. As they ramp up A350 production, we will also benefit from the floor panel production business. Actually, our floor panel production business will also benefit from A320neo production because we are also supplying floor panels for those aircraft. On Airbus P2F conversion business, conversion slots for both A320/3 21 P2F and A330 P2F are fully booked through 2026. As you recall, conversion slots for either A320/ 321 were earlier reported to be booked through 2025. Now we have booked through to 2026. There is much interest from investors on the growth of our freighter conversion business, as they have concerns that pent-up demand for freighters from the COVID pandemic may subside. These are, you know, this is one of the questions that our investors and analysts have been asking us. I'd like to point out that a freighter conversion is our core competency, and we have invested in this Airbus P2F conversion capability and business well before COVID. The underlying strength was already there even before COVID. The fundamental demand is still strong as freighter capacity planning by freighter airlines is long-term in nature, riding over multiple economic cycles. This is also the reason why we continue to invest in new conversion sites, including collaborating with third-party conversion houses. We have made a few announcements in this regard to increase conversion capacity from 2023. On how our Commercial Aerospace business has been, well managing the challenges of labor shortages and wage inflation. Total staff costs for our Commercial Aerospace business increased by a low single-digit percentage year-on-year due to manpower optimization and productivity measures. We have been able to control both the labor cost inflation and labor shortages through gradual headcount addition and by leveraging on a mixed pool of permanent and contract staff, including sourcing for a more diverse pool of manpower and labor. You will see this culminating into our OpEx unit OpEx performance, which we showed just now, and also our manpower costs as a function or as a percentage of our revenue, which continues to trend very well, even compared to pre-COVID level. We are in a very good position. Now on Urban Solutions & Satcom, the segment revenue grew 49%, including contribution from TransCore. Segment EBIT was up 13% despite TransCore transaction and integration expenses and impact of chip shortages and high investment in the product development for our Satcom business. There have also been questions on how the easing of chip shortages will benefit us. At this point, there are still inventory imbalances, and we are still experiencing shortages in the high-end chips that are used in the Satcom products and RFID tags for TransCore. We expect the situation to improve in 2023 and progressively get better afterwards. On Satcom weakness, the Satcom ground segment continued to be impacted by global chip shortage, something that we have shared with you for a while now. Macroeconomic, economic weakness and have not fully recovered to pre-pandemic levels. We are also investing in product development for next generation platform for this business. The satellite communication sector is amidst a transformation preparing or in fact, the whole satellite sector is amidst a transformation, preparing the ground for 5G infrastructure that will create a network of networks of which satellite is a critical part. It is important that we continue to invest in this new technology as part of our product evolution towards virtualization and on the cloud, all of which will pave the way for 5G. Defence & Public Security revenue grew 6% with contribution from all its sub-segments. We're going to DPS. DPS EBIT was down 13% in the absence of SGD 51 million of government support and SGD 23 million impact from energy inflation. If these factors were excluded, DPS EBIT would have been 3% stronger compared to 2021. On new contract wins, we closed 2022 with a total of SGD 13.1 billion of new contracts, including SGD 2.8 billion secured in the last quarter. Headlining our wins in 2022 was Smart Mobility projects including the contract for the new Kaohsiung MRT Yellow Line in Taiwan, which we announced, and the turnkey tolling system contract by TransCore for New Jersey. Anyway, that's the largest tolling contract in the U.S. by record based on our tracking. We also secured international defence contracts in Middle East. Lifted by these contracts after subtracting revenue delivery in Q4 2022 and the divested U.S. Marine order book, we ended 2022 with a very strong order book of SGD 23 billion. We expect to deliver SGD 7.2 billion of that order book in 2023 or this year. We do see our robust order book as a leading indicator of growth in the years ahead. The revenue pipeline it provided and the results delivered in 2022 put us on track towards achieving our five-year plan targets. We will provide an update on how we're tracking our five-year plan sometime later this year, but we are tracking well. As we move forward, we expect the operating landscape to continue to evolve. We are mindful of the continued short-term pressure on our businesses, especially when we need to continue to invest for strategic growth. This makes it an even more important task that we execute well against our long-term plan and keep to our strong track record of producing results across business cycles. To end and open for Q&A session, the board of directors has proposed a final dividend of SGD 0.04 per ordinary share. Together with the three quarterly interim dividends of SGD 0.04 per share, each paid in June, September and December 2022, the total dividend for the financial year will be SGD 0.16 per ordinary share. If approved at the April AGM, shareholders will receive their final dividend on 9th of May. On that positive note, I will invite questions, from the floor, including those who have joined us virtually. Thank you, Vincent. We will now move on to the Q&A session. We will first open up the floor to participants in the room. For webcast participants, please click the "Raise Hand" icon, and we will place you in the queue. Please state your name and the company you are from before asking your question. With that, may we have our first question from the room, please. Hi, good morning. Thanks for the decent results. A couple of questions from me. Firstly, on DPS segment. Even with your base operations, it's still a slight decline in the margin, EBIT margin. I'm just curious, how much of that would be, do you expect to be sustained at this level? Or how much was it product mix or the U.S. Marine losses related? What can we sort of expect the margin to go back to where they were previously? That question. First of all, for DPS, maybe I'll just talk a little bit about the overall business. I think for DPS, our revenue growth is 6%, but if you take out U.S. Marine, it would have been 8%. Just one. Secondly, if you look at the individual segments, each one of the businesses have grown. In fact, Digital Systems and Cyber on the chart you will see 3%, but in truth, actually, over the last two years, they've grown by 13%. They had a real kicker a year ago. From an order book point of view, for DPS, new orders for new orders last year in total, if you add up all the quarterly announcement, we came in at SGD 5.2 billion. I would say that the business as a whole, we have a strong order book, and the growth of revenue is there. The question of margins. If you look at the margin, it's still close to what we've been traditionally doing, which is 10%. U.S. Marine has an impact. We've mentioned before the losses for U.S. Marine range from $40 million-$60 million. Last year, of course, it was significant. I think moving forward, as Vincent mentioned, we won't be having that overhang, and I think that will certainly be a positive impact on the margins. Given where we are, in terms of our orders, in terms of the businesses and the products we are doing, including the international business piece, I would say that DPS should continue to do well and should maintain, if not improve the margins. Hi. Rahul Bhatia from HSBC. Just continuing on DPS side. You just mentioned that losses were significant. Are they still in the $40 million-$60 million range that you just mentioned, or it's higher than that for 2022? For U.S. Marine, it's within the range that we've announced previously. Okay. I would say that it's on the high side, on the range. Thank you. On operating level. Yeah. My second question is on the aerospace side. You mentioned low single- digit labor cost growth for 2022. What are your expectations for 2023? Related to that, can you just talk more about the labor availability or hangar availability for 2023, considering, you know, the aviation sector continues to open? Do you have the availability for these both to take new orders? Thank you. I will invite Jeff to respond to the question. Thanks very much for the questions. Thank you. I wish I could predict the wage inflation. Unfortunately—i t's not working. Okay. Good. I wish I could predict wage inflation. We are having both availability and cost challenges on the wage side. We are working very actively with the market, both training schools as well as our customers in terms of how to recruit and retain. I think there will continue to be wage inflationary pressures in 2023. In terms of hangar availability, we are pretty much maxed out because of the demand for MRO as well as P2F conversion. As a result, Vincent shared that we are opening Hangar 2 in Pensacola. We continue to have building program for Hangars 3 and 4 in Pensacola. We announced the joint venture with SF Airlines in China. That will open up additional hangar capacity. Today, we continue to build Hangar 4 in Guangzhou. From a infrastructure and capacity perspective, we continue to build for the long term. We build across economic cycles, and we didn't stop during COVID. We want to be in a position to support our customers globally and locally, and we continue to work with them. As an example, the new joint venture with SF. These are great opportunities for us to make an impact in the market. So— Go ahead. Yeah, just so that you are aware, this joint venture negotiations or the discussions with, for the Ezhou JV happened, during The COVID. It's not like because of recovery, therefore we, you know, started to have the joint venture. We've always planned long ahead. We're very pleased to be able to collaborate with SF Airlines for this joint venture. It didn't just happen because, you know, the market is opening up, and therefore we form a joint venture. This is long-term an undertaking. Now, as we face, you know, inflation, as we do, not just for aerospace and the rest, to the extent possible, we always try to make sure that we pass it through to the market, working closely with our customers, reasonably so. We do the same also for our Commercial Aerospace business. Yeah, that was exactly the point I was trying to make. To add on to what Jeff was saying, around increasing wages. As far as it's appropriate and possible, we will obviously be working with our customers to help us with those increased costs. Hi. I'm Siew Khee from CGS-CIMB. Can I just check on TransCore or USS division. Is there any seasonality in TransCore business? If we just look at the revenue line, we probably look at them contributing about SGD 300+ million-ish revenue in second half. Just wanted to check on seasonality. Secondly, there's a stark improvement in EBIT margin for USS from a loss in first half to second half. Maybe you can just share about what's the sustainable operations. I know that you mentioned chip shortage is still an issue, but BAU side, have you seen any improvement and whether this is sustainable or if there's any one-off? Finally, we mentioned that TransCore is not earnings accretive yet, and it will be second year, which is 2024 or 2023? The second year. That it will be— We completed a transaction in March of 2022. In the first year, we became cash positive. From the second year of operation, we will be earnings accretive. Thanks. I'll let Lee Chew address the first question. Yes. Thank you for the question. Maybe I'll answer the first question on TransCore's business seasonality. As you know, TransCore's business centers around projects that they implement for the tolling agencies and the customers. Naturally, there will be an impact of seasonality as the projects, you know, gets designed, installed, implemented, and so forth. Against that backdrop, we also communicated that our contract renewal rates for TransCore is very high, at 95%. Our recurring and reoccurring business in TransCore is also 50% of the mix. Outside of the project-based revenue, there will obviously be the RFID tech business that Colin was alluding to earlier. There is this other component of our recurring and reoccurring business. Hopefully that gives you a perspective of how the revenue is make up. You know, the seasonality will obviously be colored by how these three components add up. The question on whether the EBIT. And just to make sure I understood it correctly, the question was whether the EBIT that we are seeing is sustainable. Is that right, Siew Khee? Yeah. What caused the improvement from a half-on-half or? Yeah. Naturally, when you look at a half-on-half compare, TransCore's transaction was closed on the 18th of March. We didn't get a full half year contribution from TransCore from an EBIT standpoint. Flowing into the second half, the half-on-half compare takes into consideration the full half contribution from TransCore. So minus of the, you know, the integration and transaction costs, we saw contribution coming from TransCore. We, obviously, you know, have been also looking at our projects, our mobility road, rail and road projects, and we've been continuing to look at delivering to expectations there. Those are the reasons why you have seen a improvement. As we look forward, just to answer that question, the nature of the TransCore business, as I described earlier, should give you a good sense on how that will shape the contribution of EBIT in the go forward. As we look at the opportunities around Satcom as well as around the Urban Solutions, whilst we are facing the, you know, the usual or rather the headwinds across the globe in macroeconomics, the reality is that the agenda of urbanization, digitalization continues to be front and center for our customers. We see some short-term headwinds on the Urban Solutions side, but we will continue to see customers, you know, focusing on such solutions, which we have covered under our strategy under Smart City. On the Satcom side, whilst you have seen a relatively weaker-Performance in terms of revenue, and that's really because the uncertainties in macroeconomics have impacted our customers across all markets, not excluding Satcom. We are seeing delays in project and programs. Satellite operators are also deferring their purchases. The chip shortages, we expect to persist through 2023. We continue to stay the course though in working closely with our customers, so we are very happy that, you know, as we work with them and as we continue to invest in our product and technology development. In our 2022 customer survey, with our customers in Satcom, amidst all this economic and supply chain challenges, we have seen strong support from them, indicating that they appreciate the quality of our products. They appreciate the fact that, you know, we have continued to invest in product development, and they are very likely to recommend our services and that they see us as a trusted advisor. Against all those dynamics, I think we are positive that as some of these challenges ease off, we will continue to see support from our customers in this segment. Thanks, Lee Chew. I want to talk a little bit about TransCore and the point that Lee Chew made about continued urbanization. We are seeing opportunities to apply TransCore's technology solutions, as I mentioned in my CEO quote you have seen. As we look at the pipeline in this part of the world, we are actually quite heartened by how we are able to now leverage on TransCore's technology and solutions to address markets that we were not able to address in the past using those solutions. In time to come, we hope to, you know, achieve these synergies that we set out to achieve. Of course, we have a pipeline of opportunities, and we'll brief you as and when we have, you know, successful projects. We are heartened by the pipeline, because of our ability to leverage on TransCore. Hi, this is Shaun from Credit Suisse. I have six questions here. Maybe I could start with TransCore. Would it be possible to share TransCore's EBIT margin? Because when I did some reverse calculation, it seems like the EBIT margin is a lot softer than what it was back in 2019 and 2020. That's the first question. The second relates to the integration and T&I expense. I recall it was supposed to be around SGD 30 million-SGD 40 million for this and next, this and next year. I understand that the upfront and transaction expense has already been incurred, so it's more of integration expense. What is that like? What level is that like and how long it would last? The third question is on Commercial Aerospace. I just need an update on the aviation asset securitization, the SGD 500 million one. On the P2F, I understand we reached gross margin breakeven for that program. I guess the next step would probably be when would this program reach net profit margin breakeven? Fifth question is on energy inflation. I was hoping to understand the nature of this energy inflation. Is it electricity prices or is that something else? Should we expect that to reverse next year? How should we think about that? The last question is on the AV bus business that we have exited. What was the net loss contribution last, maybe last year? What kind of CapEx have we invested in that program? Thank you. Okay. Thank you, Shaun, for your questions. It's a very comprehensive list of questions of six. We will let Lee Chew address the questions on TransCore's margin. Can't really compare with stand-alone in 2019. We [inaudible]. I'll let Lee Chew talk about it. And I'll also let her talk about the transaction and integration expense, which you are right. The bulk of it is integration, as you also mentioned to you. And I'll let Jeff talk about the asset securitization for our aerospace leasing, aviation leasing business. Then we'll let him talk about a profit breakeven, a profit equity for our P2F business. When is it expected? I think he already gave the answer early on, but I'll let him explain. Energy. Yes, exactly. It's on electricity, so it just goes up and down. It is really beyond our control. We try to pass it to our customers to the extent possible. Whatever you saw on the slide earlier on is whatever we couldn't pass on. If our electricity prices come down, then we will not be seeing that kind of cost. For AV, without going into the specifics, this year on a net basis, we will avoid about SGD 5 million of investment, net-net. Okay. We know that in the next five to seven years we're gonna you know, spend about SGD 150 million of investment, which is something that we are not, after holistically reviewing the situation, not prepared to proceed, okay. This year we will avoid about SGD 5 million net of investment for AV Bus compared to 2022. Okay. All considered, including wind up costs and so forth that we have to take it this year. Okay. I will maybe go in reverse. I'll let Jeff talk about the aerospace questions, and then I'll let Lee Chew round up with the questions on TransCore. Yeah. Thank you, Shaun. Yes, you remember correctly that we intend to outplace some aviation assets this year. Our target is to do so by middle of the year so that we can free up about SGD 500 million in cash. That is on target at the moment. In terms of the P2F gross profit margin breakeven, which we achieved at the end of last year, our plan is this year, sometime this year, we would achieve the EBIT margin breakeven sometime during the year and certainly, for the full year. There continues to be market challenges around supply chain, vendors, raw materials, as well as the availability of skilled labor. I think those are the areas that we have to continue to work hard on in order to reduce the risk of those impact on our business. Thank you. Okay. Let me cover the question on TransCore EBIT margin. As you know, TransCore is part of our USS segment, and therefore our reporting would be as such. I would say, though, that, you know, when we acquired TransCore, we had a very clear business case. We know that the acquisition of TransCore is going to high grade our USS portfolio, and we continue to, you know, to hold true to that. We are seeing a integration and transaction costs to obviously be pared down over what we have spent in 2022. We announced earlier that it was SGD 30 million-SGD 40 million. We'll see SGD 10 million-SGD 20 million, possibly on the low side of the SGD 10 million, as we complete 2023 and 2024. Okay? I think you had a question on AV Bus as well. Maybe I'll take that. Okay. Sure. Yeah. Maybe we can let Ravi talk a little bit about energy costs because, you know, half of it impact that you saw just now, mainly in the [inaudible]. Yeah. Shaun, thanks for the question on energy. Let me share with you what we are doing. There are three parts of it. The first part, of course, is that where we can and for new contracts, we are passing all these energy cost increases to the customer, either directly or through an arrangement where they actually pay for the energy costs so that we don't take on the energy risk. That's one. Two, we're also looking at how we can reduce our energy utilization in terms of our automation, in terms of digitization, to see where we can reduce our consumption. And thirdly, in fact, extensively for Defence Aero and Commercial Aero, we've been using solar panels to actually, you know, take up part of the energy consumptions, so that overall we are buffering but also transferring the cost to the customer, as additional cost as energy prices are, you know, are volatile now. Thanks, Ravi. Any other questions? Do we have any questions from the floor? If not, we will move on to our web[inaudible]. Sorry, just one more question. Just to clarify, the jump in depreciation and amortization of intangibles was mainly due to TransCore then? Yeah. TransCore is one of them. Yeah. One of the key factors. Yes. Any others? Mainly TransCore. Mainly TransCore. I'll get my colleagues to confirm that. I think that's mainly TransCore for the increase in amortization. Okay. We will now move on to a question from the webcast. Jame from Citi, we have unmuted your line. Hi. Afternoon. Jame from Citi here. Thanks for the presentation. I have four questions. The first question is just on effective tax. I'm not sure if I missed this during the presentation, but what led to the positive tax credit of about SGD 15 million in the second half? Would you like to finish asking your? Okay. All your questions, and then we address, Jame? Okay. Sure. My second question is on DPS. Could you maybe share, you know, any trends on the Digital/ Cyber revenue sub-segment? I think it was down both half and half, and year-on-year. Considering this is, you know, a growth area for the business, how should we think about revenue trends going into this year? My third question is on USS. Could you maybe share what the revenue and EBIT growth and also the EBIT margin would have been, ex- TransCore for FY 2022? My last question is for maybe Jeffrey, just on Commercial Aerospace. I think EBIT margins were down half-on-half, by around 2.2 percentage points even after, you know, adjusting for the pension benefit that was booked in the first half. Just wondering what the driver for this was, given that it was mentioned that, you know, P2F profitability improved in the fourth quarter. Any detail there would be really helpful. Perhaps we start with the last question. Okay. Jeff, after that, we let Lee Chew talk about USS, then Ravi talk about digital and the business. After that, Colin or myself, we address the tax credit other than that you mentioned just now. Yeah. Okay. Shall we? Okay. you're referring to half and half for year 2022, right? Not to 2021, right? Both half and half. Yeah, half and half it was down about 2.2 percentage points. Okay. The, yeah, SGD 72 million. If you recall, we actually had a significant government grant last year. In fact, we actually made up for the loss of the government grant. In addition, you know, we also topped it up, like you said, with the pension restructuring. Actually we're seeing a sustained EBIT margin, and we expect that it will continue to improve with the improvement in the P2F conversion capability. If you look at last year's government grant, it exceeded SGD 100 million. We actually more than made up for that. Thank you. On the, on the question about TransCore's contribution to EBIT, to USS EBIT and revenue growth. I would actually point you to the sub-segment highlights that were shared earlier. You can see that there is a split between the Urban Solutions & the Satcom revenue picture. Colin also mentioned, and Vincent likewise, about the challenges that we had in the Satcom business. You can see here that, you know, Satcom really had been impacted globally by the areas that I mentioned earlier. On the Urban Solutions front, we have seen, you know, the pace of TransCore as expected from our transactions, or rather from our business case. You know, if you look at the 75% increase, year-on-year, accounting for that three-quarters of a year performance from TransCore, I would say this is in line with our expectations. Great. Jame, thanks for the question on our digital business. Our Digital business, as we have shared earlier, comprise the Cloud, AI Analytics, and Cyber business. On the Cyber business, last year they did really well. We've also beefed up our team now to about 500 people. The Cyber business has won significant contracts in cybersecurity, OT, and IT, as well as encryptors for remote work. The order book is strong, and the opportunities are there, and we expect the Cyber business to continue to grow certainly in the coming year. For our Cloud business, we have made more inroads in this time in the education sector. Able to do some work for the Institute of Higher Learning, which actually building up our portfolio of our cloud opportunities even further. On the AI and software part of it, I think we are quite happy to say that our AI modules are now being incorporated in many of the mission and command systems that we are building. One recent feature that we've been working on and we are looking forward to roll out is voice recognition to support real-time operations where operators are listening to calls and then having an AI module that automatically translates the voice to text and fills up the forms and gives us all the necessary information. Overall, for the Digital business, last year was a good year. Good orders as well as revenue. We are optimistic that this momentum can be maintained and we should do better. On the question on tax, we as part of our U.S. Marine divestment, we structured the deal such that we kept retained all the tax attributes. When we disposed U.S. Marine, we got some tax benefits, and this is just normal tax finalization. Jame, I hope that answers your question. [Lorraine], just to confirm, yes, TransCore amortization is the main contributor to the increased amortization in 2022. Thanks. Actually, sorry, can I just follow up with Jeffrey on his answer for Commercial Aerospace? I'm more looking for the half-on-half sort of trend for EBIT margin because I understand that last year was there were government grants and the first half there was pension benefit. If I strip away all of those, you know, one-offs then on a half-on-half basis compared to first half of this, of FY 2022, it was down 2.2%. Just wondering what the drivers were given that P2F is actually, you know, turning a bit more profitable there. Just wanted to understand the trend there. The year before when we received government grants, we received more government grants in the first half than in the second half. When you look at 2022, it's actually an improvement if you strip away government grants versus 2021 as well as in the second half of 2022 versus first half of 2022. Right? We actually had to make up for more of the gap because of the government grant differences between first half and second half. I hope I answer your question, if not we can clarify outside of this. Yes, indeed, we do have a strong performance in Commercial Aerospace. We can address that maybe separately. Yeah. Okay, understood. Thanks a lot. Thank you for answering my questions. Thank you. Thank you. Thank you. We'll just take one last question before we close the session. Do we have any final question from the participants in the room, please? If not, I invite Vincent to give us his closing remarks. Thank you very much for being here today for our first results briefing for the year. As I mentioned, all things considered, all factor considered, we're actually pleased with the results that we had in 2022. We believe that we are well-positioned for achieving our five-year plan targets in the years ahead. On that positive note, would invite those who of you who are here physically to join us for lunch. For those who dial in, join us via video conference, thank you very much for your time. I wish you a very pleasant Friday afternoon and also a very good weekend ahead. Thank you.