The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Richard Hatch - Berenberg Bank - Analyst
: Yes, thanks very much. Good morning, Jamie and team, and congrats on the nice set of numbers. I've got three questions. The first one is, Jamie,
can you perhaps just give us a bit more sort of color and flavor on what's going on in the business development angle, particularly in capital mining?
Just be interested to know what the opportunities you're seeing there and any hopes for any new sort of contract announcements in addition to
Sukari contract. That's the first one.
The second one is just on the numbers, just noting that the increase in inventory, which I guess is part of what's going on with COVID and part of
a growing business, but any kind of targets there for trying to add back some of that working capital build, particularly in inventory? And then the
third one is I've just noted this morning that a couple of your competitors are engaging in M&A, although it has not been successful at this point.
I just wonder what your view is on any sort of M&A opportunities that you're seeing in the space to kind of provide additional scale in a step change
for the company through M&A?
Thanks.
Question: Richard Hatch - Berenberg Bank - Analyst
: Thank you.
Question: Andrew Breichmanas - Stifel Nicolaus - Analyst
: Thanks. Good morning. Two questions for me. First, you talked about the planned tender pipeline, but I was wondering if we could just get a bit
more granularity on what you've seen particularly on the drilling side because the aggregate data for the sector seems to suggest a weakening of
activity in June and July. So is the demand you're seeing more reflective of the locations you're operating in and your client relationships? And
does that commentary suggest that you're starting to get some visibility past the rainy season and into 2023? So that's the first question.
And the second question just really relates to your approach to shareholder returns. I think you mentioned that your dividend policy continues to
target returning up to 20% of NPAT. So there's some discretion in that policy. So I was hoping to understand some of the considerations that go
into setting the payout? And secondly, you just mentioned buybacks by some of your peers. You've completed a program at the start of the year,
but I just wanted to see how further buybacks could contribute to your shareholder returns policy going forward?
Question: Andrew Breichmanas - Stifel Nicolaus - Analyst
: Okay. Thank you.
Question: Alex Padvani - Canaccord Genuity - Analyst
: Hi, Jamie, can you hear me?
Question: Alex Padvani - Canaccord Genuity - Analyst
: Great, thanks. Two questions from me this morning. So first is just how you guys are thinking about your efficient debt level and repayment going
forwards. I note that on a net debt to EBITDA basis or the multiple, you guys are less indebted than your peers. So how much further do you think
you'll sort of go with debt repayments and where do you think the efficient level sort of sits, whether it's into the short, medium or long term?
That's the first question.
The second question is just around cost inflation. So obviously, you've got some significant rise and fall mechanisms in your contract. I just wanted
to get a sense -- a sort of ballpark sense of how much of your cost base is actually projected by that? So the industry sort of saying 20% cost inflation,
then how much that will actually impact your EBITDA margin? Thanks.
Question: Alex Padvani - Canaccord Genuity - Analyst
: Great. Thank you, guys. [Very quick].
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