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Operator: Good day, and thank you for standing by. Welcome to Insignia Financial First Half 2026 Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I'd now like to hand the conference over to your first speaker today, Andrew Ehlich, General Manager, Capital Markets. Please go ahead.
Andrew Ehlich: Thank you, and good morning, everyone. Welcome to Insignia Financial's 1H '26 results for the 6 months ended 31 December 2025. I'd like to begin by acknowledging the traditional custodians of the lands on which we meet today and pay our respects to elders past and present and to all Aboriginal and Torres Strait Islanders on the call today. Presenting today are Insignia Financial's Chief Executive Officer, Scott Hartley; and Chief Financial Officer, David Chalmers. Scott will provide an overview of the 1H '26 results, the achievements during the period and execution against our 2030 strategy. David Chalmers will discuss financials before we hand back to Scott to discuss outlook and priorities for the remainder of 2026. There will be an opportunity to ask questions at the end of today's presentation, which should take about half an hour. I'll now hand you over to Scott.
Scott Hartley: Thanks, Andrew, and good morning, everyone, and thank you for joining. Today, we're reporting our first half results and continued progress against our 2030 vision. We recorded a 6% increase in UNPAT to $132 million, reflecting higher average FUMA supported by positive net flows and disciplined execution of our cost-out program. Below the line cash costs were reduced from $153 million to only $16 million, driving significant improvement in NPAT. Net revenue increased 1.8%, supported by higher average FUMA of $339 billion, up $19 billion. We also continue to execute cost out with base operating expenses reduced by $31 million to $449 million despite inflationary pressures. First half group revenue margin at 42 basis points is a mixture of Master Trust, which is favorable; and Wrap, which was lower due to the timing of initiatives, and we'll speak to this in the segment updates. Despite our lower revenue margin, we were able to deliver improved cost-to-income ratio to 63%, down from 68%, showing momentum while recognizing there is still more to do. We've made solid progress against key initiatives underpinning our 2030 vision. This slide provides a high-level snapshot of some of these achievements, which we'll cover in more detail through the business unit updates. We revitalized the iconic MLC brand in October with A Lifetime in the Making creative campaign, and we're already seeing improvement in brand metrics. In Advice, we delivered an improved cost-to-income ratio whilst maintaining strong growth and the strong external recognition of Shadforth advisers. Wrap, initial investment in AI capabilities markedly improved customer service and adviser back-office efficiency, while momentum continued with strong improvements in flows supported by product enhancements during the half, including MLC Retirement Boost. In Master Trust, we introduced a new direct-to-consumer offering as part of our MLC brand launch, making it easier for members to join. Transition to SS&C is already delivering cost savings, and the MasterKey platform transformation remains on track for delivery later this calendar year. And in Asset Management, investment outcomes remain strong with 87% multi-asset FUM outperforming benchmark, supporting continued retail flows momentum. In the Advice business, we've delivered an increase in net revenue and an improved cost-to-income ratio, driven by improved adviser efficiency, net new client growth and a focus on higher-value clients. Importantly, revenue per adviser increased 15% versus the prior corresponding period, reflecting the shift in mix and productivity. Shadforth was again the most recognized advice firm in Australia with 27 Shadforth advisers in Barron's top 150 and 5 in the FS Power50, which speaks to the depth and quality of our advice capability. The acquisition of PMD Financial Advisers by Shadforth strengthens our high net worth capability, adding around 400 client families and over $700 million in funds under Advice, which supports our strategy to grow advice through higher-value clients. And operationally, the reengineering of the advice review process, including targeted investment in AI remains on track. Wrap delivered strong momentum in the half. MLC Expand recorded $3.3 billion of net inflows in first half '26, and Wrap scale remains over $110 billion in FUA. We continue to improve efficiency, cost to serve reduced and EBITDA raised increased, reflecting ongoing cost-out benefits across the platform and enablement functions. Wrap margins were lower than guidance due to changes in product mix, the impact of higher account balances on fee capping and a delay in migrations of external platforms to the Expand platform. Innovation is a key driver, highlighting the launch of the MLC Retirement Boost. And continued investment in AI is strengthening customer service outcomes and improving adviser back-office efficiency, while clearly feedback indicating -- sorry, with early feedback indicating the initiatives already deployed are saving advisers significant time. In Master Trust, we are delivering on simplification and unlocking benefits of scale. We completed the transition of custody services of MLC to BNP Paribas in October 2025. We are now realizing cost-out benefits, including impacts from the SS&C partnership. Cost to serve improved to 32 basis points from 36, and EBITDA increased to $147 million. On flows, Workplace and digital -- sorry, Workplace and Direct are positive. Advised and personal remain challenged, with work underway to enhance AI-enabled member engagement and improve the adviser experience. The MasterKey platform transformation is on track for later this calendar year, supported by our strong partnership with SS&C. Last October, we launched our new direct-to-consumer offering for MLC Super to align with the MLC brand launch. So the brand promise is backed by a better member experience. We're also using AI to scale engagement, enabling more targeted segmentation and personalized experiences across all digital channels. Margin has been impacted by repricing initiatives, including pricing reductions to MasterKey and Plum, and we'll continue to balance competitiveness with value. In Asset Management, investment outcomes remain a clear strength. 87% of MLC Asset Management FUM outperformed benchmarks. And MLC MySuper Growth is ranked top quartile over 5 years. We delivered $5 billion of net flows into multi-asset across managed accounts and diversified funds that was more than offset by outflows in Direct capabilities and predominantly institutional -- which was predominantly institutional rebalancing in fixed income. On earnings, EBITDA was softer, reflecting mix and business challenges -- sorry, business changes, including the sale of the U.K. commercial property investment manager in October 2025 and repricing of the MLC MultiSeries suite in June 2025. Capability depth continues to build. Alternatives has grown to $4 billion since launch. Managed accounts are over $4 billion, and we progressed the private equity program with the close of Co-investment Fund IV in December 2025. We launched a national campaign in October centered on A Lifetime in the Making, drawing on 139 years of heritage while making the message practical and action-oriented, helping Australians reframe Super around actions they can take today. We are seeing early positive momentum in tracking. Awareness is up 1 point, consideration up 3 points and reputation is steady at 70%. And we prepared the campaign with a stronger direct proposition, refreshed mlc.com and an improved direct-to-consumer offering for MLC Super, so the brand promise is backed by a better customer experience. Turning to the scheme update. As previously announced, we entered the scheme implementation deed with CC Capital for $4.80 per share consideration, implying an equity value of approximately $3.3 billion and a 57% premium to the undisturbed close on the 11th of December 2024. The Board unanimously recommends that shareholders vote in favor of the scheme. Implementation remains subject to regulatory approvals, APRA, FIRB, the ACCC and FCA, but noting ACCC has already approved; shareholder approval and court approval and the independent expert concluding the scheme is in the best interest of shareholders. We submitted the draft scheme booklet to ASIC and the ASX for review, and the expected time frame remains the first half of calendar year 2026. I'll now hand over to David Chalmers, our Chief Financial Officer, to go through the financials in detail.
David Chalmers: Thanks, Scott, and good morning to everyone on the call. I'll begin the review of financial performance with a summary of our results for the half year ended 31 December 2025, starting with net revenue of $718.2 million, an increase of 1.8% on first half '25, driven primarily by average FUA growth of 6%. The revenue outcome for first half '26 is consistent with the themes underpinning our FY '26 guidance, namely the growth from higher FUMA and Advice revenue would be partly offset by strategic price reductions in Wrap and in particular, in Master Trust. Before turning to comment on costs, a quick reminder that first half '26 is the first reporting period under our revised operating expense framework. We now split total operating expenses into base OpEx, and think of those as being the ongoing BAU cost of running the business and reinvestment OpEx, which captures discretionary investment to support future growth. The intent of this change is to bring above the line the majority of costs that had previously been reported below the line and therefore, adjusted inside UNPAT. So while our 5-year plan continues to target a reduction in base OpEx over time, investors should expect average reinvestment OpEx of $60 million to $80 million per annum across the 5-year period plan. First half '26 base OpEx declined by 6.4% to $449.2 million, while total OpEx decreased by 0.5% to $480 million. From a profitability perspective, performance improved meaningfully versus first half '25, with EBITDA up 6.5% to $238.2 million and underlying net profit after tax increasing by 6.3% to $132.1 million. There was also a significant improvement in reported UNPAT -- sorry, reported NPAT, improving from a loss of $16.8 million to a profit of $78.8 million. It's worth noting on NPAT that this included in this result is the noncash impairment for a minority-owned associate entity, which was written down by $17 million. Finally, group net revenue margin in first half '26 fell from 43.8 basis points to 42%. Moving to the next slide. This steps through in more detail the key drivers of changes in revenue and costs. Let's start first with revenue, which is shown on the top chart in Slide 14, and I'll briefly step through each of the movements in the waterfall chart. I commented earlier about the strong financial markets throughout the first half of FY '26. That drove a $35.5 million increase in FUMA-related revenues, supported by market growth of 3.9% over the 6 months to 31 December and as noted earlier, year-on-year average FUMA growth of 6%. Next, there is the impact of margin decline. So Master Trust margins declined by $21.7 million, reflecting the full year impact of the pricing changes to MasterKey and Plum implemented in October '24, which were initially fully supported by trustee funding that is now progressively scaling down. Wrap margins decreased by $8.5 million following changes to admin pricing fees implemented on the 1st of June last year. Asset Management margins were $6.3 million lower, largely due to the divestment of our U.K. commercial property manager, Orchard Street, in October 2025 and the repricing of the MLC MultiSeries suite of diversified funds in June '25. On the positive side, it was pleasing to see Advice revenues increased by $7.9 million, driven by growth in client numbers, higher average fees following price increases and stronger Shadforth market-linked fees due to favorable market conditions. And finally, in the Corporate segment, revenue was $5 million higher than first half '25, largely reflecting the absence of a $4.3 million one-off loss recorded in the prior period -- in the comparative period, which was the loss on deconsolidation of Rhombus Advisory. Turning now to costs, where it's to fully understand the cost structure story, it's important to consider both the costs above the line, so the base OpEx and reinvestment OpEx I referred to before, but also the movement in below-the-line costs. So above the line, the base OpEx reduced by a net $17.9 million, with a further $12.9 million of costs previously included in base OpEx now classified as reinvestment OpEx. Reinvestment OpEx increased by $28.6 million to $30.8 million for first half '26, tracking a little below our full year expectation of $80 million, albeit with spend forecast to accelerate in the second half of the year. The most material change in cost is in the below-the-line costs. So focusing on UNPAT adjusted cash items, these reduced significantly from $153 million in first half '25 to $15.9 million in first half '26, reflecting the completion of separation projects and the reclassification of project-related spend into the above-the-line group OpEx numbers. Moving now to the next slide. The substantial reduction in below-the-line cash spend has translated directly into a strong improvement in free cash flow, which was positive $52 million for the period. Now by way of comparison, that same number in first half '25 was negative $239 million, driven by transformation and separation costs of $100 million and remediation payments of $102 million. In first half '26, cash UNPAT increased from $153 million to $196 million with no separation costs incurred as that project has concluded and lower remediation payments as those programs near completion. Free cash flow also benefited from a $51 million reduction in IFL corporate balance sheet funded RFR, consistent with the updated prudential standard SPS 114. And I'll also note that as historically has been the case, we expect a material improvement in free cash flow in the second half of FY '26. Moving from free cash flow to net debt and funding requirements. I guess the first thing to reflect on is how much simpler this profile is compared to prior years, where significant future spend was required for transformation and remediation. Senior leverage at the half was just under 1x net debt to EBITDA, so just 0.9x. And it's worth reminding investors that the EBITDA used for our syndicated facility differs from the EBITDA shown on Slide 13, primarily due to the exclusion of profits from certain IFL subsidiaries for debt covenant purposes. For FY '26, our future funding requirement for remediation is expected to be $54 million, including the final legacy remediation, as well as the repayment of the $254 million subordinated loan notes prior to May 2026. We expect closing FY '26 total leverage of around about 1x net debt to EBITDA, consistent with the capital aspirations outlined in the 5-year business plan, which target ongoing leverage from FY '27 onwards at or below 1x net debt to EBITDA. A brief comment on the next slide on dividends, where the approach is the same as was taken when considering the final FY '25 dividend being that due to the terms agreed with CC Capital, there will be no dividend declared under the terms of the scheme implementation date. There are some provisions to pay a dividend to shareholders under the terms of the [ SID ] if the scheme has not become effective within 12 months of its signing, that is 22nd of July 2026, after which we can pay a special dividend on a monthly basis at 50% of monthly UNPAT, so long as net debt after the payment of that dividend is less than $500 million. Finally, turning to guidance for the remainder of FY '26, we're making 3 updates. Firstly, while Master Trust margins were stronger than expected in first half, this largely reflects timing effects, some but not all of which we expect to unwind in the second half. These include delays to expected product simplification initiatives that will lower margin, including the rationalization of the capital guarantee product and outsourcing trustee services for retail insurance products. But these timing benefits are not fully unwind in the second half, meaning that we now expect margins to be modestly higher than original guidance. And we've therefore, increased the range from 51 to 52 basis points to 51.5 to 52.5 basis points. The second change reflects -- the second change to guidance relates to Wrap margins, where we've reduced guidance from 27.5 to 28.5 basis points to 27 to 28 basis points, again, with most of this movement reflecting timing. So [ silly ] to Master Trust, there is an impact from the slower-than-expected migration of some of our white label arrangements to expand that will increase margin when implemented. But because these have been pushed into early FY '27, that benefit will also be pushed into '27. The second impact to note on first half '26 margins are the fee tiering due to higher levels of market growth across the period. The third and final change to guidance is our corporate segment, and it's related to the delayed white label migrations in the Wrap segment I've just commented on, where payment of tax costs associated with that move was previously expected to sit as an expense between Corporate gross revenue and Corporate net revenue. And with that delay that I mentioned, that cost will no longer be incurred in second half '26, resulting in higher corporate revenue, and we've reflected that in the guidance. Importantly, our cost guidance remains unchanged for FY '26, noting, as I did earlier, we do expect an acceleration in reinvestment spend in the second half of the year. And with guidance covered, that concludes the financial section. I'll hand back to you, Scott.
Scott Hartley: Thanks, David. So in terms of how we're progressing on our vision and strategy, the slide summarizes that we are making solid progress on executing the 2030 vision and strategy. Each business has clear work streams. For example, Master Trust is focused on digital direct and scaled engagement along with the simplification agenda and Advice focused on growth and efficiency. In the Wrap, we focused on servicing and AI enablement of adviser efficiency whilst creating the innovation in the retirement products. And in Asset Management, accelerating our unlisted capabilities. Across the group, there are three common threads, continuous cost excellence, becoming an AI-enabled organization and building a high-performance culture to support our ambition for double-digit earnings growth. We are tracking clear outcomes to keep ourselves accountable, including the Q1 cost to serve, Q1 customer NPS and Q1 employee engagement. And all of this -- all of it ties directly back to the 2030 vision to be Australia's leading and most efficient diversified wealth manager by 2030. Touch on the Master Trust transformation roadmap. This is a multiyear transformation program, and the sequencing matters. We're working closely with SS&C to transform Master Trust to simplify the Master Trust business and drive efficiency. There are four streams running in parallel. First, the corporate transformation. This is moving the cohort of employees that we moved over to [ SMC ] off our platforms and into the SS&C technology environment. And this is on track for completion in the financial year of '26, consistent with our mid-calendar 2026 milestone. Second, the platform migrations are sequenced, MasterKey in the fourth quarter calendar 2026, the P&I platforms in quarter 4 calendar 2027. And finally, Plum will migrate in mid-calendar 2028. The broader objective is to migrate all four technology ecosystems onto Bluedoor by the end of FY '28. Alongside this stream, we are -- we have a third stream, which is around simplification, focused on simplifying our operating model, entities, brand and product simplification. And finally, and importantly, throughout this period, we are investing in the growth levers that continue throughout scale engagement, digital product improvements and retirement offering launches. So we're simplifying whilst building momentum. And finally, our FY '26 priorities are as follows: FY '26 is about delivery, and our priorities are clear and execution led. First, we are preparing for the Master Trust platform migration to Bluedoor, targeted for the first half of calendar 2027. Second, we will sustain momentum from the MLC relaunch -- brand relaunch and continue building direct engagement. Third, we will continue to convert product innovation into flows, including retirement boost and ongoing Wrap momentum while continuing to strengthen the proposition for advisers and members. Fourth, we're focused on improving Master Trust net flows through deeper member and adviser engagement. Across all of this, the nonnegotiables are building and embedding a high-performance culture, delivering ongoing net cost reduction and scaling AI across the enterprise to enable the 2030 vision. I'll now hand back to Andrew for any questions.
Andrew Ehlich: Thanks, Scott. We'll hand over to the operator to take questions.
Operator: [Operator Instructions] We will now take our first question from the line of Lafitani Sotiriou from MST Financial.
Lafitani Sotiriou: There's one -- initial one is, can you just talk us through the scheme process from here? And what the price -- whether there's any flexibility with the actual price, given how well the business has been going and your own thoughts on that?
David Chalmers: So it's David here. So the process for the scheme is the scheme booklet is being finalized once it's received comments back from ASIC and the ASX. Once we have that -- and the independent expert report is in there that talks to -- that we'll talk to value. The second thing that I'd highlight we're waiting for is or more to point CC Capital is response or some feedback on its APRA application. And so that process needs to sort of unfold. And once there is clarity on that, you could expect that we would then be in a position to call a shareholder meeting with the normal sort of 28-day period for that shareholder meeting, once we've gone through the court process to effectively approve both the booklet and the way that we're conducting the vote and those sorts of things. So that's sort of the timetable. There are no mechanisms within the terms of the [ SID ] for alterations or changes to the price. Other than, as I noted before, if scheme implementation goes beyond the 12-month period, then there is the capacity to pay a special dividend subject to a number of conditions. So that would be the only thing in the [ SID ] that would allow for any variance in terms of consideration.
Scott Hartley: I'd only add that the business is performing to the expectations that we laid out in November last year, upon which the bid has been put to us and accepted unanimously by the Board for recommendation to shareholders. It's a very good bid at 57% higher than the understood price at the time of the bid. We are operating in a market that is very competitive and with lots of regulatory oversight and change. And so we are unanimous and remain unanimous as the Board that the price that we are recommending to shareholders is -- should be accepted by shareholders.
Lafitani Sotiriou: Got it. And can I just follow up with the detail on the Master Trust roadmap and the replatforming and the cost out? Can you just remind us because it's been a while since you sort of had the Investor Day Strategy Day, the anticipated cost savings to come through efficiency gains over '27, '28 and beyond?
Scott Hartley: So over the period to 2030, we stated last year, and that remains the case that we expect $200 million of cost savings from -- gross cost savings from the Master Trust business. And that represents about half the overall cost savings -- gross cost savings that we are expecting to achieve through that period. So yes, the targets that we sort of set ourselves in November last year, we are -- we remain on track to achieve those. And about half of those targets or expectations come from the Master Trust migrations and simplification.
Operator: [Operator Instructions] I'm showing no further questions. Thank you very much for your question. I'll now turn the conference back to Andrew Ehlich for his closing comments.
Andrew Ehlich: Thank you. That concludes today's results presentation. Thank you for your attendance, your ongoing interest and support of Insignia Financial. Please feel free to reach out if you have any further questions. Thank you.
Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect your lines.