AUB Group Limited (AUB) Earnings Call Transcript

Thank you for standing by, and welcome to the AUB Group Fiscal Year '25 Results Conference Call. [Operator Instructions] I would now like to hand the conference call over to Mr. Mike Emmett, CEO and Managing Director. Please go ahead.

Good morning, and thank you for joining us as we present AUB Group's financial year '25 results. On the call this morning, Mark and I will take you through the results, and then I'll close with our positive outlook and initial guidance for FY '26. We'll then open the line for Q&A. Turning to Slide 2. Before we move to the detail of the results, let me reflect for a moment on what we are building at AUB and the returns we have generated. AUB Group has undergone a substantial transformation over the past 4 years, emerging as a leading global insurance broking group. In FY '25, our roughly 6,000 team members across nearly 600 locations placed approximately $11 billion in premium on behalf of clients. While we now operate in close to 20 countries, the majority of our teams are in Australia, New Zealand and the U.K. The charts on this slide highlight our strengthening footprint and the growth we have delivered. We've built scale and increased the diversification of our business across geographies and business units. Wholesale and agencies have expanded significantly, while retail broking remains our foundation, contributing 62% of global revenue. The bar charts on the left demonstrate our consistent delivery of profits and shareholder value with underlying net profit after tax and earnings per share compounding at 32.3% and 18.8% per annum, respectively, over the past 4 years. Today's strong results continue our momentum, and we have a great deal further to go. Slide 3. In FY '25, AUB Group delivered another strong result as we executed our growth and efficiency strategies, both domestically and internationally. Underlying net profit after tax rose 17.1% to $200.2 million and the EBIT margin increased to 34.7%. This outcome sits above the top end of our guidance range and reflects an uplift on the outlook provided in May. During the year, we completed 16 smaller investments in bolt-ons, alongside strategically significant investments in Pacific Indemnity, Momentum and Movo. Momentum in Movo have accelerated our U.K. retail business with premiums growing from GBP 110 million in FY '24 to GBP 340 million in FY '25. Agencies and BizCover continued to perform strongly, delivering profit before tax growth of 30% and 26.8%, respectively. In Australian Broking, ongoing optimization and consolidation supported EBIT margin expansion to 37.8%. Looking ahead, we have started FY '26 well. We have a positive outlook and expect ongoing earnings growth. Initial guidance is for FY '26 underlying net profit after tax to be in the range of $215 million to $227 million, representing year-on-year growth of 7.4% to 13.4%. I will now hand over to Mark.

Thanks, Mike. Good morning. Turning to Slide 4. During FY '25, revenue increased 12.7% on FY '24 to $1.5 billion. I'd like to highlight the continued expansion of our EBIT margin to 34.7%. This is a particularly pleasing result, marking a substantial uplift from the 26.9% margin for AUB in FY '19. Underlying EPS increased 9.5% on FY '24 to $1.7175 per share. The Board has determined a final dividend of $0.66 per share, bringing the total dividend for FY '25 to $0.91 per share, up 15.2% on FY '24 and representing a payout ratio of 53% of NPAT. The waterfall chart on Slide 5 illustrates the key drivers of FY '25 UNPAT growth. Strong organic growth of 11.9% was complemented by a 12.1% contribution from acquisitions. These gains were partially offset by FX headwinds, modestly reduced funding costs and the impact of the previously mentioned bonus period realignment at Tysers. Moving to Slide 6. AUB's balance sheet and funding capacity are well placed to support our growth strategy. At 30 June 2025, AUB Group Limited had $375 million in available liquidity, comprising cash and undrawn debt with a leverage ratio of 1.97x. The table on the bottom left outlines the composition of the group debt facility. On the right, we compare look-through trust and operating cash balances against look-through debt, showing cash exceeding debt by over $300 million. This is relevant because while we pay interest on our debt, we also earn interest on a substantial portion of cash. We have factored further interest rate reductions in the U.K. and Australia into our FY '26 forecast. The Tysers earn-out was settled in March 2025, reflecting a 95% achievement of the maximum performance targets set at acquisition. I'll now hand back to Mike.

Thanks, Mark. Slide 8 summarizes divisional performance. I'm pleased to say we delivered revenue and profit growth across all our businesses. Australian Broking revenue grew 8.4%. This, together with a 100 basis point expansion in EBIT margin lifted AUB's share of profit before tax by 12.8% to $135.6 million. BizCover delivered another standout year with revenue up 15% and the margin expanding 380 basis points to 45.8%, driving a 26.8% increase in AUB's share of profit before tax to $19.1 million. Agencies revenue rose 25.1% to $220.5 million, supported by the Pacific Indemnity investment, while the EBIT margin expanded to 44.2%. Profit before tax from Agencies increased 30% to $72 million in FY '25. New Zealand revenue grew 10.3%. As outlined in February, we saw an opportunity given industry changes to accelerate market share growth, and we invested in a team to attract new brokers and clients. While this investment offset profit growth in FY '25, the early results are promising with new business up 34% versus FY '24, giving us confidence in this growth potential. International revenue increased 13.3% with EBIT margins slightly lower at 23.5%. We remain confident in achieving our medium-term margin targets, supported by the breadth of opportunities across the international portfolio, which I'll cover in more detail shortly. As shown on Slide 9, in Australian Broking, we continue to optimize the portfolio of businesses to enhance margins. And this includes simplifying the portfolio, pursuing bolt-on acquisitions and increasing equity stakes where appropriate. This disciplined approach has delivered consistent revenue growth and margin expansion, as shown in the charts on this slide and highlighted by a 4-year CAGR in revenue of 9.5% and a steady annual improvement in EBIT margin. I'd like to acknowledge the strong contribution of MGA and Insurance AdviserNet, 2 of our largest brokerages. In financial year '25, we completed 5 acquisitions, including 3 bolt-ons, 4 portfolio restructures, 7 equity step-ups, 1 equity step-down and 2 disposals, a very active year. Importantly, shortly after the year-end, we finalized the merger of AEI Group and AB Phillips, 2 of the largest businesses in the Austbrokers portfolio, a move expected to accelerate both growth and margin improvement. Our underlying client portfolio continues to deliver strong organic growth with average commission and fee income per client rising 9.3% year-on-year, bolstered by an increase in fee income. Moving to Slide 10. BizCover's strong customer growth is driven by its unrivaled value proposition and market-leading technology platform. In FY '25, revenue grew 15% to $105.8 million, supported by the addition of 30,000 new customers. EBIT margins improved across both Australia and offshore operations and client retention remains robust, underpinned by an excellent NPS of 74, a reflection of BizCover's excellent service teams and processes. Investment in technology and product innovation also continued with Vero joining the ExpressCover platform and the new RelyOn Business Pack launched in partnership with Chubb and HDI. Since AUB Group's investment in FY '21, BizCover has delivered compound annual EBIT growth of 21.8% and expanded margins by almost 1,000 basis points, highlighting the strength and scalability of the business model. Slide 11. The Agencies division delivered an excellent year with premiums up 20% to $1.3 billion and revenue rising 25.1% to $220.5 million. Profit before tax growth comprised 11.5% organic and 28.8% from acquisitions, most notably Pacific Indemnity, while the EBIT margin improved to 44.2%. Our EBIT margin target of 45% assumes a 40% underlying margin plus approximately 5% from profit commissions. In FY '25, the margin, excluding profit commissions of 42.5% exceeded this target. However, profit commissions of $6.7 million were only 6.9% of agency EBIT this year versus an historical average of 10%. The chart illustrates this showing EBIT growth over the past 4 years, including the proportion derived from profit commissions. On the left-hand side of the slide, you can see the agency premium mix is now close to the 40-30-30 target for General Commercial, Specialty and Strata set 4 years ago and the total premiums have surpassed our original $1 billion goal. The Strata division has experienced lower retention rates than in the past with overall premiums remaining flat year-on-year. And this reflects a deliberate decision to balance growth with disciplined underwriting. Pleasingly, our Longitude Strata agency delivered an excellent result despite challenging conditions in the strata market. Portfolio transfers between General Commercial and Specialty mean these categories are not directly comparable year-on-year. We've built an exceptional agencies platform comprising market-leading businesses. The division continues to offer significant growth opportunities, while our disciplined approach ensures sustainable profitability in partnership with our insurer partners. Slide 12. In New Zealand, profit before tax growth of 11.4%, $2.6 million was largely offset by a $2.1 million investment in resources focused on new business growth, resulting, as expected, in a reduced margin. We're optimistic about the strategy with new business already 34% higher in FY '25 versus FY '24. This business has been significantly transformed in recent years with a clear uplift in financial performance. Our 2 largest brokerages, ICIB Brokerweb and Runacres, continue to perform strongly. The loader technology platform is now live in 10 of the roughly 40 brokerages in our network with further rollout planned for FY '26. During the year, we completed 6 acquisitions, including 4 bolt-ons as well as 4 equity step-ups and 2 equity step-downs. And these transactions are strengthening scale and equity partnerships across the country. We see substantial further opportunity for AUB in New Zealand. Slide 13. On a constant currency basis, the International division delivered organic EBIT growth of 12.3%, with acquisitions contributing a further 14.6%. These gains were partly offset by the bonus performance period changes at Tysers, a one-off impact on FY '25. FY '25 was a year of strong progress across the international portfolio. In wholesale, we appointed a new CEO and strengthened Tysers by attracting new teams, particularly in financial lines and marine. We also made targeted investments in specialty brokerages, MGAs and portfolios to expand Tysers live in North America and our marine yacht capabilities in the U.K. and Europe. In Belgium, we increased our shareholding, completed the bolt-on acquisition and appointed new leadership. In the U.K., we commenced execution of our retail expansion strategy by appointing a new CEO. Key investments in the Movo and Momentum Broking networks significantly increased our scale with Movo's equity businesses complementing existing Tysers retail branches. As a result, U.K. retail premium grew from GBP 110 million in FY '24 to GBP 340 million in FY '25. Our owner driver model is well established and highly successful in Australia and New Zealand. These recent investments in the U.K. have enabled us to commence replicating this model there, effectively leapfrogging into a strong market position. Whilst relatively unfamiliar in the U.K. and other international markets, our engagement with industry participants suggests our owner driver model is already being recognized as a clear competitive advantage for AUB. Looking ahead, our focus in FY '26 will be to further expand the U.K. network to continue to enhance wholesale capability and to leverage the scale and operational capabilities we have now built. Slide 14 highlights the transformation of the International division since the acquisition of Tysers in FY '23, underscoring both the scale achieved and the opportunities ahead as we execute our strategy. At the bottom of the slide, you'll see strong financial progress. Premium and revenue have grown significantly. The EBIT has increased at a 19.5% compound annual rate and margins have expanded by 480 basis points, good momentum to achieve our 32% margin target. While overall headcount has grown, we have also optimized operations, reducing 110 FTE through restructuring. Other key changes are summarized on the slide. I'll emphasize 3 in particular: the enhancement of our capabilities in major global insurance hubs, the separation and build-out of U.K. retail and the strengthening of Tysers wholesale across Marine, Property and Casualty, Specialty and Tysers Life. And in parallel, we have significantly upgraded critical support functions, including technology, legal, risk, compliance, finance and tax. As shown on Slide 16, a key focus for AUB Group has been to expand divisional EBIT margins to achieve medium-term targets first set in FY '22 and updated in FY '23. EBIT margins in Australian Broking, BizCover and Agencies have each improved by more than 900 basis points over the past 4 to 6 years, while the International division margin has risen 480 basis points in the 2.5 years since acquiring Tysers. In New Zealand, we have deliberately prioritized market share growth, temporarily reinvesting margin into expansion plans until the end of FY '26. We review progress against margin targets annually. Given the strong performance of the Agencies division in FY '25, we are increasing its medium-term margin target by 2% to 47%. No changes are being made to other divisional targets at this stage, but we do see scope for future improvement. It's worth noting that margin targets for Australian Broking, BizCover and New Zealand were each upgraded twice during 2023, while the International division target was also revised upwards during that period. Now we expect questions on whether the agency's margin target has been lifted enough given the strong underlying performance in financial year '25. After careful review, we believe this adjustment is appropriate. And while there are significant revenue growth opportunities from recently seeded agencies and new launches planned for FY '26, these growth investments do temper our operating leverage in the near term. We, therefore, consider the revised target both realistic and appropriately set. Having delivered this growth track record, on Slide 17, we outlined 6 execution priorities for FY '26 as follows. Firstly, to continue optimizing broking portfolios in Australia and New Zealand to enhance margins through bolt-ons, mergers and portfolio restructures. Secondly, to scale new and recently established agencies to accelerate revenue and margin growth while also seeking to replicate the strong performance of Australian agencies in our international portfolio. Thirdly, to grow market share by better leveraging the breadth of AUB's broking businesses in New Zealand; Four, to facilitate further growth in BizCover with a particular focus on accelerated progress of ExpressCover and further expansion in New Zealand; Five, to optimize U.K. retail by leveraging the increased scale and capabilities from the Momentum and Novo investments. And finally, six, to continue building out Tysers and other specialty capabilities while driving greater efficiency in middle and back-office functions. As you can see, AUB has multiple earnings drivers across the group, independent of broader macro conditions. Turning to Slide 18. For FY '26, we expect underlying net profit after tax in the range of $215 million to $227 million and earnings per share of between $1.8441 per share and $1.947 per share, representing growth of 7.4% to 13.4% on FY '25. At this stage, our forecast incorporate only those acquisitions and equity investments we consider highly likely to complete. Other key assumptions underpinning this outlook, including our views on foreign exchange and interest rates are summarized on the slide. As has been widely reported, premium rates in certain geographies and risk classes have moderated over the past 18 months and remain the subject of speculation. AUB Group remains confident that rational pricing will prevail and importantly, that we continue to have a range of levers available to outweigh the impact of premium rate movements, something we've already demonstrated through our performance in FY '25. We anticipate another positive year ahead and look forward to updating you about this during the roadshow. I'll now pass back to the moderator for questions.

[Operator Instructions] Your first question today comes from Tim Lawson from Macquarie.

Just specifically on the International segment. Obviously, the EBIT was ahead of where the market was going for. Can you just unpack what you've -- your expectations and where it came in versus your expectations on revenue and expenses, please?

Yes. Thanks, Tim. So I think a few top line observations. Revenue was stronger in wholesale and retail than our original estimates. Expenses were a bit higher, particularly in some of the acquisitions and investments that we made during the year. And so broadly, I guess, the revenue was higher, expenses were a bit higher. So the absolute EBIT was better than we forecast, margin probably slightly behind what we -- margin percentage slightly behind what we forecast.

Is there any particular reason why the wholesale and retail did better than your initial expectations?

In terms of the revenue, no, I mean, look, it's hard, obviously, to predict these things. So the reality is we had probably a bit better new business growth than we had anticipated. We saw a bit more flow through. Interestingly, some of the levers -- so without overcomplicating the answer, there's some macro commercial services agreement type revenue that we didn't get resolved during the year that we thought we would. So at the beginning of the year, looking forward, I have said, let's call it, regular revenue as in new clients, revenue from existing clients, et cetera. That all was at or slightly better than we expected. Revenue from overlaying commercial services type agreements from insurers, we made less progress on that than I had anticipated. And so tailwind, headwind combination.

But net-net, still better than you had expected?

Correct.

So just maybe on New Zealand, just what you're hoping to achieve from that strategic growth investment you're putting in? You've called that out in one of the bridges.

Yes. So I mean, I referenced it at the half year. So in December, we made a decision to recruit and carry a team of resources. This is in the dozens rather than the single numbers to focus on new broker and new customer wins or acquisitions on the basis that we feel that there is a particular market opportunity for us to grow market share through those 2 types of acquisitions. Early signs are very positive. It is a significant investment. And so we made a conscious decision without putting too fine a point on it. Obviously, during FY '26, by the end of FY '26, it will either have generated revenue that more than compensates for the incremental cost or we will address the cost accordingly and adjust the cost.

And your next question comes from Andrei Stadnik from MS.

I ask my first question around the premium growth you saw in the International division. I think you've got about 15% headline premium growth. Can you talk a little bit about maybe the underlying growth, excluding U.K. retail acquisitions? And also just curious if there's any multiyear, I guess, revenue items in international?

Not multiyear. So that one is easy, Andrei. They tend to be -- I mean, obviously, there's quite a high intermediary retention. And so a lot of the wholesale revenue comes from business with MGAs and retail brokers in other parts of the world. So it's not multiyear, but there's a relatively high retention rate, but not multiyear as in, I don't know, 10-year premium contract or anything like that. Obviously, the sizable step-up in premium is from acquisitions of retail. If you put that to one side, I think the one difficulty of comparing premium growth with revenue growth is just to emphasize, the premium is at a point in time. So for example, if we bought a business on, I don't know, a month before the year-end with $100 million of premium, that full $100 million will be added to our premium numbers, whereas the revenue obviously is the accounting measured revenue for the year. So that's -- so there's a lead and lag effect of conversion of premium to revenue. But the underlying growth in the business is good. In fact, if you talk about wholesale, Tysers was a pleasant surprise for us in terms of revenue for the year. We don't want to be presumptions about it. So we're not predicting an extrapolation of pleasant surprises. But the reality is we were pleasantly surprised. It did better in the second half than we anticipated. And so a good performance by the -- from the international team's point of view.

For my second question, can I ask around the comment around the 9.3% average fee and commission per client in Australian broking, can you help just like investors reconcile a little bit how that 9.3% comes in ahead of overall revenue growth in Aust Broking of about 8.5%.

Sure. So I'll illustrate the calculation, don't take the numbers explicitly accurately. So our commission and fee income last year, you've got to retention rate to that. So assume 90%. So if you took last year's commission and fee income, multiply by 90%, grossed up by 9.3% and then the difference between that number and the FY '25 commission and fee comes to about $50 million difference, I think, $52 million. $52 million difference. If you then in that -- some of that comes from acquisitions, some from new business, net new business, so genuine organic new client, new business. And so if you assume, not completely accurate, but if you assume the same split as we've split profits between organic and acquisition, then you get to about a 10% new business growth, and that's how the best to reconcile those. And you can apply the same thing in New Zealand. The difference in New Zealand is that our new business growth is higher and our retention rate is lower. Does that answer your question, Andrei?

Yes.

And your next question comes from Scott Hudson from MST.

Firstly, could I just understand in terms of your guidance for FY '26, does that capture any, I guess, meaningful cost out within the International business as a result of the, I guess, acquisition of the 2 retail businesses?

Not a result of the 2 retail businesses. There is still a little bit of a hangover of actions that -- so let me start by saying, so we never used to call out what we've called strategic change initiatives. Last year, we got a question about -- in fact, I think it was at the end of FY '24, we got a question about that. So since then, we've been calling out explicitly. It used to just be part of our acquisitions cost line in the reported profit calc. And so what we did was in FY '24, we started explicitly calling this out. Basically, when we acquire a business, we have an acquisition plan about how we're going to improve the margin of that business. So as part of our acquisition case, and so that acquisition plan includes identifying some cost out. It includes some potentially, I don't know, a replatforming or an IT piece moving them on to our IT platforms. Those costs provided in that acquisition cost or in that acquisition plan we put below the line. Obviously, any other costs, so just, let's call it, a normal redundancy, et cetera, goes above the line. So it's restructuring linked to acquisitions, okay? So there is still some further work to be done in executing our acquisition plan related to Tysers and some of the international businesses, but not explicitly for the U.K. retail networks that we bought.

Is there cost out opportunity within, I guess, the Tysers business in relation to headcount that was previously servicing the retail division?

There is a bit. But as we action these things, we identify exactly what's possible. So we obviously had a case and then the reality. So FY '26 will be when we start -- now that we've separated out retail from wholesale, we do have ways that we can now look at leveraging some of the operational efficiency of the new acquisitions to service the historic Tysers retail business, and that will unlock some opportunities for us to look at the way in which we can realize savings in, let's call it, Tysers, historic Tysers.

Great. And then just in terms of your -- I guess, your guidance and in particular, your organic growth, if the Tysers bonus accrual is a one-off cost in FY '25. I'd assume the sort of the underlying base is already at sort of $211 million. So can I just understand sort of why the organic growth is, I guess, relatively anemic in comparison to what's been achieved through FY '25?

Yes. So a bunch of comments. I mean I'll start by talking about FX and interest costs actually -- or interest income. So the headwinds in that organic growth column include about a $3 million post-tax headwind on interest costs going down. So as a reminder, we are -- so we have trust and operation -- so the trust cash, which exceeds our debt cost, but it doesn't really matter. So if we save -- so interest rates go down, we'll save on the funding cost piece, but that's a group cost and it's below the EBIT line. But the actual reduction in income from invested funds affects our organic growth profit number, yes. So we actually have a $3 million headwind built into that. So you could say that you've got to take $11.2 million and add $3 million to it. Then we also have an FX headwind, which on a like-for-like basis, basically, if you restated FY '26 using FY '25 ForEx rates, both hedged and unhedged, you'd have about another $1.5 million post-tax impact. So we took the $11.2 million plus $3 million from interest plus another $1.5 million. So you're up at about -- what's that, $15 million as the base number. So that's the first point I'd make, Scott. The second piece is then we do have a headwind from the fact that as the business performs better, obviously, you get some upside in terms of revenue but the difficulty with the bonus piece. So firstly, it is a once-off, right? So you can just arithmetically add the $11 million from FY '25. What makes it complicated is that you've then got the -- so how much -- what will the net bonus adjustment be in FY '26? Well, the reality is we're trying to predict -- so we've got hundreds of people earning bonuses. A lot of them are production bonuses. So we're trying to predict a mix of business. We're trying to predict bringing in new teams. There might be an element where there's some guaranteed first year bonus. You've got that whole mix of things. So not scientific at all, based purely on sort of an estimate, I would say, realistically, I'd add GBP 6 million or GBP 7 million of the GBP 11 million to the EUR 200 million. And then if you genuine want an organic growth comparison, you might say to me, okay, well, then I want to take the $6 million off the $11 million, but the $6 million is roughly neutralized by the FX and interest headwinds. And so broadly, I'd say that the organic growth as represented is on a like-for-like basis, the organic growth rate.

And your next question comes from Siddharth Parameswaran from JPMorgan.

I had a question firstly on -- just a question on the Australian broking business. So I just wanted to check on the sharp increase that you flagged in organic growth in the second half. I think the full year growth you're flagging was 9.1%. I think the first half was around 5%. It does suggest a very sharp uplift in Australian Broking organic growth in the second half. And I was just wondering if you could just comment on that in relation to what I thought was a slowing cycle. So maybe some of that fee revenue or other things are coming through. I was hoping you could just flesh out what's happening with that.

So I guess in some of this, apologies to those of you who have heard me prattling on about this for several years now. So if you look at the dynamic of insurance brokers, so the reality is that when rates are hard, premium rates are hard, clients are very focused on the rate, and they're willing to. In fact, they're insistent on rate sort of savings to compensate or mitigate for the increases versus exposures, right? And so they tend to focus on high excesses or deductibles, probably an element of under insurance in terms of the total insurance cover, et cetera, et cetera. Obviously, when rates are more muted, it allows a broker to actually do their jobs to the best of their ability, which is all about the balance of -- so we can almost be more innovative in a softer cycle than we can in a hard cycle where we're actually talking about reducing the deductibles, increasing the overall coverage, adding a type of cover where previously the client might have decided, look, it's not obligatory. Therefore, I'm not going to cover that type of insurance, et cetera, et cetera. So that's why I've always ranted about the fact that our income and the amount of premium that our clients pay we've got a lot of control and influence over that. And therefore, the peaks and troughs are much more muted than the pure premium rate cycle as declared by the insurers. And then, of course, we also have much more control over the fee increases. And when rates are hard and clients are experiencing, I don't know, 10%, 15%, 20% rate increase on the premium, obviously, they're very sensitive to any cost. So even a 5% increase in fee might be too sensitive. So we tend to hold and in fact, for several years, we held fees flat. And now we're increasing them, not massive increases, 5% or 6%. But all of that contributes to why we're able to generate more income per client and grow our commission and fee income, frankly, irrespective of the premium rate environment.

But sorry, but just to clarify, what is happening with the premium environment? And is it -- are those numbers -- like are there any funnies in that number where the second half organic growth is so much stronger than the first half?

No, that's more a function of when our clients renew in Australia, to be honest. It's very second half weighted.

Second half, like it's full year, full year and first half, first half, so the seasonality shouldn't be an issue?

Yes, except that you still have -- a lot of the new business comes through, you'll disproportionately get more new business nearer a renewal period than in an off period because clients don't change brokers midway through their et cetera. So it tends to be that. I mean we definitely had a stronger second half in terms of new business growth than the first half. I don't know if I can observe anything particularly from that because that's tended to be our historic profile.

Okay. Okay. And sorry, just on the cycle -- sorry, just to try and pin you down, what is happening with the cycle there, the pricing cycle?

Well, I sort of spoke about it a bit when I was talking about the outlook. Look, rates have definitely softened over the last 18 to 24 months. It's not been like an FY '25 phenomenon. It's actually a '24 and '25 phenomenon. So rates in financial lines had softened earlier than the others. And so they have -- they've sort of flattened out and probably slightly creeping up. I think some of the domestic lines rates are definitely flat or reducing. I think insurers have reached rate adequacy in terms of the profitability of their portfolio. So I think the rates are around about right now. I think as interest income softens and investment income softens for insurers, they're obviously going to be very wary and leery of further reductions in any profit out of their insurance and commercial insurance books. And so I think, as I said, we believe that rates will be -- premium rate determinations are going to be rational, and we think pricing is going to be rational. So we think that premium rates in absolute terms have probably gone up sort of mid-single digits, probably 5%. But it depends on types of clients, segments of clients and geographies. But on average, across our portfolio, there's probably been a 4% or 5% premium rate impact.