Hey, good morning, everybody, and welcome to iOCO's FY 2026 Results Call. Thank you for your interest in the group. We run a very diverse operation, and to give you a good idea of what is in iOCO, we've prepared a short video which will hopefully aid your understanding of the group.
[Presentation]
Good. Well, we hope that helped in unpacking iOCO. With me today is Ashona Kooblall, our Chief Financial Officer, and we'll get to the financial highlights shortly. Before we do that, we just review our three-step strategy. Remember, the three steps were cost rationalization, the decentralized operating model, and capital and resource allocation. We think that we've made continued progress off the 2025 year into 2026, which you can see on slide three. Profit after tax increased by 39%. We reached ZAR 357 million. Our return on equity reached over 30%, 35% in fact. Our EBITDA on an adjusted basis reached ZAR 624 million, up 21%. In a difficult market, our revenue grew 3% and IT services revenue grew 4%, indicating market share gains. Going on to slide four. Important part of this slide is to drive home the point on how diverse iOCO really is.
There are 4,382 employees at iOCO. It operates across 10 different countries, from Egypt, Mozambique, Kenya, the U.K., into Europe, and of course, the big contribution in South Africa, where most of the operations are held. The question comes, how do you run a business as diverse as iOCO? You would remember on slide five, we have introduced something called radical autonomy. Last year, you would have seen on a similar slide to this one that we only had four business units. Those four business units really came from how iOCO had evolved rather than from careful planning. It was almost what we inherited. What we did this year is we rethought what really makes sense, what businesses make sense to sit together, and importantly, where do we find the best management in the group to run businesses?
Because really, the success of iOCO is going to be driven by the quality of the managers running these businesses, and the employees who make huge sacrifices to make iOCO work. We have divided iOCO into 12 divisions or business units. You can see them on that slide five. In addition to those 12, what is fitting quite nicely into them are two acquisitions that we will discuss later, Astraia and MySky. On slide six, we indicate what makes up today's ExCo. These are the business unit heads of each of the business units. I must say, it has been refreshing to have 180 years of technology experience sit on the ExCo. They make valuable contributions to the group, and it ensures that we are in a very strong position to execute on the ever-changing landscape of tech services.
Another result of moving to radical autonomy is that each business unit can focus on turning loss-making businesses within their business unit to being profitable. What you see on slide seven is that historically, iOCO used to have loss-making units across the group. In 2025, we reduced that down to just one loss-making entity. I am happy to say in 2026, we have no loss-making businesses across the group. In fact, SBT, which was loss-making for the last three years, has now turned profitable. That is a good segue into introducing Ashona, who will take us through the financial highlights.
Thank you, Rhys. Hi, everyone. It is great to be back with you today as we present iOCO's FY 2026 financial results. The year represents another year of disciplined execution against a clear strategy. The results of that approach are now increasingly evident in our financial performance. For the year, iOCO delivered revenue growth, significant earnings expansion, strong cash generation, and further balance sheet strengthening. Our EPS and HEPS improved to ZAR 0.57 per share and so did return on equity to 35%. In addition, the group secured ZAR 2.1 billion of new multi-year contract wins during the period, providing visibility into our future earnings and cash profile. Importantly, these results were achieved while continuing to invest in future growth initiatives, which we feel is critical to enabling our forward-looking value creation plan. We will now go on to explaining our headline numbers.
Revenue increased by 3% on a constant currency basis to ZAR 5.8 billion, supported by growth in IT services and our international operations. Adjusted EBITDA increased by 21% to ZAR 624 million, while operating profits increased by nearly 15% to ZAR 483 million. Operating expenses reduced meaningfully, reflecting the benefits of a more focused operating model with improved cost discipline. Profit after tax increased by almost 39% to ZAR 357 million, while both earnings per share and headline earnings per share grew by 42%. Importantly, these results required no restatements and no normalization of performance. What you see is the direct outcome of operational execution across the group of our various lines of business. While revenue growth of 3% is encouraging, our focus remains on the quality and sustainability of that growth. Our largest segment, IT services, delivered growth of 4% during the year.
International operations grew by approximately 2%, despite the direct impact of the Middle East conflict on trading conditions for five months of the financial year. This performance is a testament to the strength and diversification of our international portfolio. Operational technology was affected by softer industry spending in FY 2026. However, the business demonstrated resilience and disciplined execution, delivering a strong underlying performance despite the challenging market environment. Pleasingly, during FY 2026, a number of our lines of business successfully developed and commercialized new solutions, expanding their markets and creating additional revenue streams. With these offerings now supported by robust go-to-market capabilities, we enter FY 2027 with increased confidence in our growth outlook. This slide best demonstrates the scale of the transformation achieved over the last six years. The group has moved from losses of more than ZAR 300 million in FY 2021 to earnings of ZAR 357 million in FY 2026.
At the same time, adjusted EBITDA has increased to ZAR 624 million. This improvement has not been driven by a single initiative. It reflects the impact of the past two years, including disciplined restructuring, radical autonomy, cost rationalization, improved capital allocation, and enhanced operational execution across our portfolio. More importantly, the outlook remains positive with value creation top of mind. Gross profit declined marginally during the year, and gross margin normalized to 28%. This was driven by infrastructure cost pressures felt globally within the technology industry, timing delays in the execution of certain contracts, and the roll-off of some higher margin work. However, this trend should be viewed in the context of our evolution. As we continue to scale technology-as-a-service and managed services offerings, we expect gross margins to stabilize at our current levels while driving higher revenues and greater operating leverage. Our goal is not to maximize gross margin percentage.
Our goal is to maximize sustainable gross profit and free cash flow, giving our customers the best possible price. On a H2 basis, what we have seen is the improvement of gross margin as we stabilize the margin profile across the business. What is also important to note is that iOCO continues to generate positive and consistent earnings on a monthly basis. Cash generation remains one of the strongest indicators of the quality of our earnings. The group generated approximately ZAR 585 million of operating cash flow during the year, supporting debt reduction, share buybacks, investment into technology platforms, and continued growth initiatives, while maintaining a closing balance of ZAR 417 million. Strong cash conversion remains priority, provides optionality, and continuous improvement in working capital remains key for the group going forward. As explained above, working capital management remains a focus area.
As a service-led and capital-light organization, our working capital profile is driven largely by receivables and payables rather than inventory. We experienced a timing-related working capital impact as our financial year fell on a Friday. This resulted in the significant inflow of cash from debtors being received in the days immediately following year-end. In addition, iOCO continues to settle creditors on payment terms that are shorter than our debtors' collection cycle. While this affected the year-end working capital position, it remains a focus for management and one where we expect to drive further improvement into FY 2027. Since FY 2021, net interest-bearing debt has reduced by approximately ZAR 2 billion to ZAR 480 million, representing a reduction of around 77%. Finance costs have decreased by approximately 75% over the same period. Importantly, the deleveraging over the past two years has been funded entirely through operational cash generation.
During the year, the group repaid approximately ZAR 101 million in capital and interest from internally generated cash flows. We also closed the year with no bank overdraft utilization while maintaining more than ZAR 600 million of available liquidity in addition to the cash on hand. Today, the balance sheet is substantially stronger. The cost of capital is also lower, and we have significantly greater flexibility to pursue value-creative opportunities. The improvement in our financial profile is clearly reflected in the key performance ratios. Interest cover improved from 6.7 x to 11.1 x, reflecting both stronger operating earnings and lower finance costs. Net bank debt to EBITDA improved from 1x to 0.8 x, while net debt reduced as well. More importantly, return on equity increased to 35%. At iOCO, we view transformation, skills development, and economic inclusion as strategic priorities. Our investment goes beyond financial contributions.
We are actively investing in talent pipelines, technical capability development, enterprise development, and digital access initiatives designed to broaden participation in the digital economy. Technology has the power to create opportunity at scale. Through our education, skills development, and community initiatives, we are helping ensure that the benefits of the digital economy are accessible to a broader segment of society while simultaneously strengthening South Africa's future technology talent pool. To conclude, FY 2026 highlights the increasing earnings power of a disciplined and cash-generative iOCO. We have strengthened the balance sheet, expanded earnings, improved returns, reduced debt, and increased our capacity to allocate capital into growth opportunities. We believe we are still early in our value creation journey as we enter FY 2027 with momentum and a growing range of opportunities ahead of us. I will now hand back to Rhys to discuss our outlook and priorities for the year ahead.
Thanks, Ashona. I am going to speak a little bit about the group outlook in the short term and into the longer term. A good place to start is on the strategy update. What I have done here is shown you what we have delivered since July 2024. From a cost rationalization point of view, we have cut costs by ZAR 480 million, and that has been driven by head office costs picking up the bulk of that, the ZAR 400 million number. Some central direct costs of ZAR 40 million and business savings of ZAR 40 million. That is an extremely well-done job. Amazing achievement for what iOCO has been through. On the decentralized operating model, I touched on this a bit earlier, but we have embedded radical autonomy and accountability into the group, and we have introduced this owner-led mindset.
Essentially what we are doing is every business unit head runs his own business as though it were his own. On the capital and resource allocation, as Ashona mentioned, it is very well done on the balance sheet management. We have been able to reduce gearing down to 0.2x net debt to EBITDA. That gives us options on the future, which I will touch on. We have had continued strong cash flow generation, and we have actually executed on buying shares back already in 2026, and we look forward to doing more of that in 2027. Very encouragingly, we have made two acquisitions in 2026. We have returned staff to the office on a permanent basis, and that has resulted in productivity enhancement, and we have brought in new sales and business solution specialists. That three-step strategy, I think we have largely done on that.
The question is going to be: how do we take iOCO forward? What I did is I went back and looked at the history of iOCO or EOH as it was called. If you go back and read the annual reports all the way back from 2000 onwards, what you find is that EOH used to be a very small little business. It started off with maybe ZAR 11 million of profit after tax in 2000. As slide 24 shows you, by 2013 and 2014, that profit had grown to about ZAR 331 million to about ZAR 492 million. What is interesting is that the profitability that iOCO has just generated in 2026 would kind of fall between 2013 and 2014.
Which is interesting, because the way that EOH got to those numbers back in 2013, 2014, they really embarked on an acquisition strategy that accounted for about two-thirds of their growth. To achieve that growth, they really made about 15 acquisitions, so about one a year between 2000 to 2015. Interestingly, if you look at the bottom of this table, you will see that in 2013, the market rewarded iOCO similar profits to what we earned in 2026 with a market cap of ZAR 7.9 billion. With acquisitions, that number grew to ZAR 14 billion market cap by 2014. Today, iOCO is generating a similar level of profitability, more efficient than it was back then. Yet the market cap is only ZAR 2.4 billion, about one-third of where it was in 2013.
When you look at it on this basis, what we reflect on is that historically, the success of EOH and iOCO was really driven off an acquisition strategy, which started off very well, and maybe did not end so well. But what we want to do is take the good parts of what EOH did historically and apply it to the business today. On slide 25, what I am showing here is the targeted acquisition pipeline of iOCO today. What you will notice on the bottom right-hand side of the slide is what we look for in acquisitions. So you are looking for companies that are founder-led, and that must be the mindset even when they become part of iOCO. They must have high earnings and margin quality, and they must fit into our business where we have gaps currently.
One of the key points about technology companies is that technology moves so quickly that while you don't have very high depreciation or CapEx, you have to make reinvestments into new parts of the business, new parts of technology, so that you can remain relevant to clients. That's where the opportunity to invest in acquisitions becomes a very real opportunity for iOCO. As I said earlier, we've actually executed on two acquisitions in 2026 already. These are good examples of what we are looking for when it comes to finding growth opportunities. I'll take you through both of them. MySky, it's a founder-led business. We bought that in July 2026. It's got strong recurring revenue. It strengthens iOCO's OEM ecosystem through HPE and Fortinet partnerships, and it unlocks the opportunities to cross-sell across iOCO's broader customer base.
It generates approximately 80% of its revenue from nine key customers. Why is that important? We have 3,000 customers at iOCO, and so we act as a platform for a company that has a very focused customer base to take its offering and export it across the whole of iOCO's customer base. When it comes to Astraia, we completed that acquisition in September 2026. It's a 90% recurring revenue business, asset-light model. It generates approximately 80% of its revenue from 22 key customers. If you take that business and then you try and roll it out across a much broader footprint, both of these businesses can scale and grow far quicker than if they were left on their own. A little bit more about the acquisition pipeline on slide 27. These are opportunities that we are actively pursuing.
You can see on the far right-hand side the deal size. We're looking for opportunities that fit very well with the cash generation of iOCO. What this means is that we can buy relatively small companies, which we do thorough due diligence on. They can then become part of iOCO. We leave them alone. We follow the radical autonomy approach, and they can run themselves. They get the best of both worlds. They become part of the iOCO platform, but they also get to be masters of their own destiny, but in a very safe home. A little bit more about capital allocation on slide 28. The other opportunity that we have to deploy capital is through share buybacks. Already this year, we've bought back about 16.8 million shares, and so we've taken the share count from 630 million down to 620 million shares in issue.
Hopefully in the next few slides, I'll show you why this makes sense. Slide 29. We've given fairly explicit cash flow guidance for the next two years. I refer back to Ashona's slide about working capital. For FY 2027, we think we'll generate about ZAR 650 million of free cash flow. That's broken up into two parts. One, the core business we think will generate about ZAR 450 million of free cash flow, which is about ZAR 0.72 a share. Then, remember we have the working capital improvement or reversal from 2026, which should bring in another ZAR 200 million of free cash flow. So that's about ZAR 0.32 a share. Combined, that means for FY 2027, we are looking at over ZAR 1 a share of free cash flow.
Rolling that forward into 2028, we expect the core business to generate about ZAR 500 million of free cash flow. You can see the improvement. We are going from ZAR 450 million to ZAR 500 million. Importantly, we expect and hope that the number of shares in issue, through share buybacks, will fall from 620 million shares that we have now, and hopefully we get close to about 500 million shares in issue. What that means is that by FY 2028, we should generate another ZAR 1 per share of free cash. Over the next two years, we see ourselves generating ZAR 2 a share cumulatively versus a share price of ZAR 4. In two years, we will be generating half our market cap. A bit more on guidance. We think recurring revenue for the group will be over 60%, and we are already over that figure today.
That gives us confidence that we can forecast an improvement in EBITDA from ZAR 624 million this year to ZAR 680 million for FY 2027. Thank you for your attention and your interest in iOCO, and we are open to questions. Good. We have some questions that have come in. We will go through them, but you are absolutely welcome to submit more questions as we answer the ones that we have already. The first question is about EBITDA growth and margin expansion and revenue growth. It is a complicated answer. The point I would make, from the presentation, you would have noticed that about a year or two years ago, we had this three-step strategy, and part of that was cost rationalization. I think we have already cut back or saved ZAR 480 million of cumulative costs over the last two years.
There is still more work to do on cutting back on costs, but the opportunity is not obviously as big as it was two years ago. The margin expansion part, I think running at 11% margin for the group, I think is a very good performance. I think what we must do now is reinvest back into the business so that you might even see that margin flatline or even deteriorate somewhat. I think that is a good thing because what we want to drive is revenue growth. The result will be that your absolute EBITDA number should grow, and if you look at the guidance that we have given, that is what it will show. Take the case that EBITDA in absolute terms, you will see growth, not necessarily margin expansion because most of the cost-cutting is done. That leaves revenue. We grew revenue 3%-4%.
I think it was a resilient performance. What you find in a group as diverse as iOCO is that when one business is struggling, another business picks up the baton and continues to make the running. That is kind of a latent strength in iOCO. The more acquisitions we put in, that is going to create even more diversification, which means that we should be in a very strong position to get revenue growth going forward. We would hope that we reach a double-digit revenue growth number, and that will be partly organic and partly inorganic, going forward. Hopefully that covers your question, but if not, please give us more details and I can cover that. Next question: has cost-cutting reached its peak? I think I have kind of covered that. I do not think it has reached its peak. We have done ZAR 480 million.
There's still more work to do, but there's not a lot left at head office to cut back on. Of the ZAR 480 million of cost-cutting, ZAR 400 million was at head office, so there's really not much left there. There are opportunities to be more efficient in some of the businesses. I think AI is going to be a way that needs to be utilized more broadly and penetrate deeper into the business, and that's going to help us as well. I think we're probably 80%-85% through on the cost-cutting part of the business, and that'll probably come as some relief to those that are working at iOCO. Another question. Your international performance was disappointing. What are the reasons? Is Egypt and Saudi still good prospects?
International was impacted by what's happened in Iran and Saudi and the UAE, and that obviously filtered through across the rest of the region. We a little bit behind where we thought we would be with Saudi, but that's through no fault of our own. That is kind of just a symptom of the broader region conflict. Payments have slowed down. Business has slowed overall, but we're still pretty positive about that region. Certainly what we looked at is anybody doing any better than what iOCO is doing in penetrating that market? We don't really see any evidence of that. We're fairly well positioned there. I think the Egyptian business did really well in a very difficult market, and we think that they will continue to deliver into 2027. Another question, how will iOCO compete internationally versus global and local players in Europe?
Yeah, we don't really see ourselves competing with the players in Europe. We've got niches that we operate in. I think the thrust of our international business is probably fostering relationships with our existing client base, continue to manage the existing work we have. I don't think it'll ever be a huge material part of iOCO at this point unless we find acquisitions there. We have recently won some new work in the U.K., which is really playing to iOCO's strengths, operating in a niche area and that is something we could utilize a bit more. Another question is, acquisitions, how do they drive growth? I think that's a good point, a good question. We make It's almost like a process of finding acquisitions. The business units, they need to find gaps in their product offering. They then feed through acquisition ideas.
Ashona and her team at the center, they do great work doing due diligence and following through on those acquisitions and completing them. We've kind of got a process in place. If you had to think about iOCO 18 months ago or two years ago, you would never think they'd be in a position to make acquisitions, but we've actually executed on two very nice businesses already. What's important to me is that there's a pipeline of companies out there. That pipeline is really a function of thousands of little tech companies have started in South Africa in the last six years. There's not many other people that are in the position with strong cash generation, a big platform of like 3,000 customers that can offer people a home for their business. Like a founder, he obviously loves his business. He's passionate about it.
If he wants to find a home for his business where we're going to leave him alone and let him run in this radical autonomy world, and penetrate the iOCO client base, there are few opportunities, I think as attractive as what iOCO is. How we drive value from that is in a couple of ways. One, we don't overpay for acquisitions. We're very disciplined on price. Two, we have earn-outs. Three, we've also got tax losses that we've inherited at iOCO that we can utilize and that makes the price we pay even more attractive. I think the success of iOCO going forward, to really get it back to what iOCO used to be in the good times, I think it's going to be driven by this kind of serial acquisition model, which I'm pretty excited about. Let's go through some more questions.
How does AI cost per task compare with similar employee cost per task, and does it allow for smaller teams? That's a very good question. I think some of the preliminary work we've done, and I would say that our Egyptian team is probably the most advanced when it comes to deploying and utilizing AI in their business. Probably, I think 77% of their engineers are using AI actively. It's resulted in probably a 50%-60% improvement in productivity, I think from the information that we have. It's something that I think we have to embrace, and it's a real opportunity. If you think about tech services business, is AI a threat or an opportunity? I think I'm coming out on the side of an opportunity to be far more productive.
I think if we are 50% or 60% more productive now, I think that number will only accelerate and improve going forward. Then we have another question. Would you mind unpacking how the guided 11% EBITDA growth will be achieved? That'll come in two parts. Obviously, we've got organic revenue growth. This year was a difficult year, tough year, and we grew revenue 3%-4%. Now, I think we can do much better than that on an organic basis. You can pencil in whatever number you want there. On top of that, if you take, let's say this next year, we'll generate ZAR 650 million of free cash. That includes the ZAR 200 million kind of working capital unwind. On a normalized basis, that's ZAR 450 million going to ZAR 500 million next year.
Now, that kind of free cash flow means that you could probably add on ZAR 250 million of equity and acquisitions. What kind of revenue would that come with? That could give you close on ZAR 500 million to ZAR 700 million of revenue, which is over 10% of group revenue through acquisitions. From a revenue growth point of view, you could be growing double digits plus on a combination of organic and revenue growth. We don't expect massive margin deterioration from an EBITDA point of view. That will easily give you the kind of guidance that we've provided. What's required to reach that guidance is, I think far more than before, iOCO is a master of its own destiny. It needs to constantly focus on winning new business. This last year, iOCO added ZAR 2.1 billion of new revenue, which is a strong performance in a difficult market.
There is another question about cost-cutting and how much cost-cutting you believe is left in the business. I think like I said, we are probably 80%, 85% through. There are more opportunities to be efficiency gains rather than outright cost-cutting, which will, as I said, come as some relief internally. We have another question. A couple of questions. Excluding acquisitions, what needs to happen for revenue growth to re-accelerate? Well, some of the big businesses this last year didn't generate the kind of performance that we were after, and they were helped out by smaller businesses doing incredibly well. I think if the big businesses start firing again, and the group works together, I think we will end up with that re-acceleration in revenue growth. I think there is some low-hanging fruit as well. Some simple things that the business can get right, which we are working on.
We have brought in new salespeople in some cases. Effectively, what we want to do is make sure that every seat in iOCO that is client-facing is the best possible person we can have in that position. That doesn't happen overnight. We are starting to see very positive momentum coming through there. Another question. Could you talk us through the tax losses are being utilized? Okay. If you look at our tax rate overall, our tax rate is efficient. We are happy with where we are on being on the right side of SARS. We will continue to take a conservative view when it comes to utilizing our tax losses. Another question. How do you intend to achieve revenue growth? I think we have covered that. How do you intend funding acquisitions, shares, or cash? Well, that is a very good question.
It really depends, but we want to share the risk equally. A founder selling his business, obviously, we don't want him to sell his business and walk away the next day. We follow a model of radical autonomy. What that misses is that you don't have a team working together across the group. What we hope to do is that with being incentivized on a common share, or equity, means that everybody should be working together to make sure that the group is cohesive. We are not there yet, but certainly when it comes to acquisitions, we want to use earn-outs, deferred compensation, and using our shares. Unfortunately, our shares are trading at 25% free cash flow yield, maybe even more. Issuing equity becomes quite a costly exercise. We would rather be acquiring the shares.
There will always be a mix to make sure that people are correctly incentivized, and we share the risk equally. Why did iOCO stop buybacks during 2026? Given the next two years, you will deliver ZAR 2 a share free cash flow. I assume share buybacks will become your primary capital allocation. It is a very good question. Just to finish that question, it says, "I assume share buybacks will become your primary capital allocation priority for FY 2027 and 2028 at these levels." I think if I had to ask a question on this call, I would probably ask that one. I will tell you the answer to it. Like I said, we are probably generating ZAR 450 million plus the ZAR 200 million, and then next year, hopefully another ZAR 500 million. The priority is acquisitions. That is priority number one.
But there's no way that we'll be able to spend all that money from the acquisitions that we have. What's quite interesting is if you go back at iOCO's history when it was still EOH and you take the period of time from 2000 to 2015. That's when iOCO was, well, EOH had this huge market cap, and everybody loved it. Back then, it only really did 15 acquisitions over that period, 15 major acquisitions, which were one acquisition a year. Now, in this last year, we've already done two acquisitions. They are smaller, but a smaller acquisition still requires a lot of due diligence, a lot of extra work, and it's a bit like Charlie Munger said about marriage, you have to choose the best person that'll have you. And it's a bit like that with acquisitions.
We have to find the best acquisition that will want to be a part of iOCO. We don't want to force anybody to be in iOCO. We want companies that actually see the opportunity and want to be part of this rebuild. So, we've looked at many, many acquisitions. We've looked at some big companies, some smaller companies, and to answer this question more directly, what you find is that you do due diligence on a company, and then you realize that what you have in iOCO is actually a better quality business that you feel more comfortable with. And then, that kind of reinforces your decision about share buybacks. Because you say, well, I'd rather, instead of spending money on an acquisition, which is of maybe less certainty, at least you know what you're getting. We know the business in iOCO, and so we can allocate capital towards that.
I would say, I think in the presentation, we used a share count number target. Which I'm not sure too many companies do, but we've kind of given this target of 500 million shares in issue. So we've got 620 million at the moment. We hope to get to 500 million shares. But clearly, that'll be contingent on where the share price is. So the lower the share price is, the better it is for buybacks, quite clearly. Do you have a long-term capital structure in mind? Is the growth funded by debt, or should debt continue to be maintained at current lower levels? We have minimal debt. It's like 0.2 x net debt to EBITDA. There's opportunities for us to take on more gearing should an acquisition opportunity arise. So, I would be very comfortable with iOCO carrying, 1x to 2x net debt to equity.
I'd even think iOCO could take on maybe 2.5 x, but with a plan to always reduce that debt. I do like businesses to have some debt in them to keep expenses tight and the focus on cash flow generation. So I do think there's an opportunity to increase the debt at this point. Okay, I'm just reviewing the questions. How do you see executive remuneration normalizing over the medium term to sustainable levels? Good question. I think we have a very low executive remuneration strategy at iOCO. And I think when it normalizes, that might be very much in favor of equity over cash. We want the executive management of iOCO focused on driving up the performance of the business, and that should be reflected in capital allocation decisions. And ultimately, that'll be reflected in the value that iOCO is traded at on the market.
I do expect that to normalize. I do not think it is normal yet. It is certainly on the low level and shareholders get the benefit of that. Then we have a question. There is a question from, share price of iOCO is down 9% year to date. What could the reason be? I would not know the answer to that. I would say that, as I said earlier, the lower the share price is, the better it is for existing shareholders because it allows us to buy shares back at a more attractive price. I would not be too worried about short-term performance issues on the share price. iOCO's market cap is only ZAR 2.4 billion, so it is a small-cap company. Even in South African terms, so I would not worry too much about that. I think that brings to an end our questions. Thank you very much for joining us.
If you have any further questions, please contact iOCO. There should be the contact details on the website. Thanks once again.