[Foreign language] Te Nā Kōtū Kātua. Good afternoon, everybody, and welcome to this meeting. My name is Doug McKay, and I am Vector's Chair. I'd like to acknowledge [Foreign language] Ngāti Whātua Ōrākei as mana whenua for Central Auckland, where we are today. As we have a quorum and it's 2:00 P.M., I will now declare open the 2025 Annual Meeting of Vector Limited Shareholders. We're starting today with ordinary business, which includes short addresses from myself and Simon, and then seven resolutions. We'll see how short Simon can be, given it's his last run. You take as long as you like, mate. As part of these resolutions, you will also hear short addresses from the directors who are seeking re-election. After that, we'll move to general business, Q&A, and then voting. Today's meeting is a hybrid meeting where shareholders can participate here in the room and online.
As this is a Shareholder Meeting, we ask that you do not use the time for asking specific operational or customer service questions that relate to individual projects or your situation. We're happy to have those questions and queries, but we have members of our customer team available here in the room and after the meeting, and they will be very happy to help you with any of those types of queries. We do encourage shareholder questions and will indicate question time after each of the presentations. We'll have microphones available for you. Once you've asked your question, please give the microphone back while we're answering your question so that others can have their turn. So that everyone can have a turn, we ask that you keep to one or two questions per person.
If you still have more questions or feedback, Simon, our Group Chief Executive, and I will be available after the meeting to chat with you as required. We also welcome the media to our meeting today as observers, but ask that you please hold your questions until after the meeting, or if you would like to talk to Simon and myself, then please make yourself known to one of our communications team who are at the back of the room or call our usual media phone number. If you're online and you'd like some help, you can type your query and one of the Computershare team will assist you. Voting today will be conducted by way of a poll.
If you're here in the room, you can mark your voting paper at any time, and a team member from Computershare will collect the voting forms before the end of the meeting. If you're online, you will be able to cast your vote under the vote tab once I declare voting open. I will indicate when voting will close so that you have a final opportunity to cast your vote. With those instructions now complete, I do declare voting to be open. The number of proxies and the proxies held by myself as Chair of the meeting or in my own name are shown on the screen. It is my intention to vote the discretionary proxies I hold in favor of the resolutions. It's now my pleasure to introduce my fellow directors Alastair Bell, Vaughan Busby, Dr. Paul Hutchison, Dame Paula Rebstock, Bruce Turner, and Anne Urlwin.
Also at the table, we have Group Chief Executive Simon Mackenzie and John Rodger, our Chief Legal and Assurance Officer and Company Secretary. Vector's Chief Financial Officer Jason Hollingworth and External Auditor Matt Deprose from KPMG are seated in the front row together with other members of Vector's executive team and advisory team. Now to the business. I'm pleased to report that our financial performance for the year has been solid, as you will have seen in our results announcement in August. Just before I get into some of the highlights, I want to comment briefly on the regulatory cycle for electricity networks, as this has a strong impact on our results, and you'll hear this come through in the presentations. Late last financial year, we entered into a new five-year regulatory cycle for electricity networks.
This is where the Commerce Commission resets what revenue we can earn from the electricity distribution business. This is known as DPP4 because it's the fourth of these cycles, and DPP stands for Default Price-Quality Path. DPP4 started on April 1, 2025, so has been in effect for the final quarter of these financial results. Simon will go into more detail shortly. If I move through some of the numbers, for continuing operations, adjusted EBITDA has increased by 16%. Adjusted EBITDA is earnings adjusted for fair value changes, associates, third-party contributions, and significant one-off gains, losses, revenues, and other expenses. The increase is a result of higher revenue, particularly in the last quarter, where higher revenue from the new regulatory price path has come through. We've also maintained prudent financial management across the group.
Group net profit after tax for continuing was NZD 154.7 million, which includes a NZD37 million impairment of the gas distribution business. The impairment recognizes our latest forecast for gas network connections, where we see a decline in connections in FY 2026 as a result of significant market uncertainty, scarcity of gas, and rising costs. Following the impairment, the carrying value of the gas distribution business is now consistent with the estimated value of the regulated asset base, which is key to determining the regulated revenue. The electricity network performed within the regulatory quality standards for the duration and frequency of outages, although we acknowledge that any outage is frustrating for customers, and we understand how important it is that homes and businesses can rely on their electricity supply.
I want to give my thanks to the Vector team and the field service providers who work so hard to keep the lights on for Auckland. This is not just after a severe weather event, but every day through large-scale programs of planning and building for the future, maintaining the network we have today, and getting out to make repairs quickly and safely when something impacts network performance, such as a car hitting one of our poles. We've announced an unimputed final dividend of NZD 0.13/ share, taking the full-year dividend this year to NZD 0.25/ share. This represents an 85% payout of free cash flow in the midpoint of the 70%- 100% range, as stated in our policy. Shareholders should not interpret this year's payout as being an indication that future dividends will be in the midpoint of the range.
Overall, the board is pleased to see a solid financial result and completed transactions, including the sales of our natural gas trading business, On Gas LPG, and HRV. These completed transactions enable us to concentrate on the core strengths and demands of our regulated electricity and gas networks, while also exploring growth opportunities. These growth opportunities include Vector Technology Solutions, our investment in metering business Bluecurrent, and other options that may emerge with the changing market, consumer needs, and the scale of investment required for the economy to electrify and decarbonize. Our balance sheet is strong, and as such, we have the capacity to consider other opportunities. I'd like to thank Simon and his executive team and everyone else at Vector for their hard work throughout the year.
This is Simon's final Vector shareholder meeting, and I'd also like to commend him for his leadership and significant contribution to the business during his time at Vector, including the past 17 years as Group Chief Executive. We've also announced that Chris Blenkiron will be joining the team as Vector's new Group Chief Executive in December. Chris is a highly regarded leader. We conducted an extremely thorough search process, both locally and internationally, and through this process, Chris demonstrated astute insights into the energy sector and Vector's future growth opportunities. I'd like to now hand over to Simon.
Thanks, Doug, and good afternoon, everyone. I'm pleased to share some highlights of the year, including examples of how we're bringing our strategy to life and some of the key issues facing Vector in the wider sector.
Doug has mentioned the DPP4 regulatory cycle that began on the 1st of April this year. Under Default Price Path 4, we've seen the Commerce Commission increase allowable revenue for transmission and distribution businesses, which has occurred largely as a consequence of higher interest rates and inflation experienced within the prior Default Price Path 3 period. We're well placed to continue our disciplined network investment approach in the DPP4 period, which is to avoid committing to high levels of capital investment in areas where there is significant uncertainty or to cover short demand peaks when there are other less capital-intensive ways to use available network capacity and maintain network resilience. We're very conscious that cost of living pressures for consumers remain high. DPP4 has resulted in price increases on power bills, and we recognize this is hard on all consumers.
However, in real terms, our electricity lines charges remain very similar to what they were more than 10 years ago, and the increase under the Default Price Path 4 is a function of interest rate movements. It is also important to note that the total increase has been smoothed out over the next five-year period. Our distribution line charges make up around 27% of the total bill that consumers receive. We've heard commentary in the media that it's these lines charges that have driven higher consumer power bills this year. Whilst it is true that the Commerce Commission changes under the price path have increased bills, only 27% of the bill, or around 35% if you also add in transmission costs from Transpower, there is still a majority of the bill impacted by other factors such as the cost of energy.
What is less well understood is that a key measure of the cost of producing new electricity, the levelized cost of energy, has stepped up significantly in the past year, and this will need to flow through to power bills eventually. Our commitment to Auckland's growth and electrification remains strong, and the region continues to grow despite the broader economic slowdown. While we've seen a softening in the rate of new connections this year and fewer private electric vehicles being sold, Auckland is experiencing rising demand for hyperscale data center connections, each with significant energy requirements. Data center projects offer major opportunities for the region and for New Zealand more broadly. For example, hyperscale data centers typically request around 20 MVA in the first phase of multi-stage developments, which is roughly equivalent to 8,000 homes.
However, they're accompanied by uncertainty about the rate at which the electricity demand will grow to meet the capacity requested since this depends on the adoption of data center services by the data center clients. We know these hyperscale data center requests will drive a need for us to invest in system growth, but we must ensure our investment is moving in step with the anticipated demand. Because of the scale of some of these projects, their impacts may not be confined just to our distribution network. They may also affect electricity generation and transmission, so careful and coordinated planning is critical and working closely with the data center sector and government.
Our Symphony strategy puts our customers at the center of our decisions, and we're acutely aware of the importance of getting the right balance between affordability and prudent, efficient investment, given the cost of living pressure many of our customers are facing. Our approach to investment I referred to earlier is one example of how we manage costs that flow onto customers. As we've talked about in previous annual meetings, our strategy looks to harness smart use of technology to smooth out consumption away from peak periods. This is part of how we ensure our electricity network is equipped for increased demand as the reliance on electricity continues to increase. While we must prepare for the future needs of Aucklanders, our focus remains on providing a reliable, resilient, secure energy supply today and doing this as efficiently as possible.
For example, in the past year, we've inspected more than 2,000 km of network using drones, and we've completed 12 projects to boost resilience and future capacity in the CBD, alongside numerous other projects, large and small, across the entire region. An example of our strategy to embrace strategic partnerships to help us innovate faster, realize cost efficiencies, and facilitate disciplined investment is the launch of GridAware. GridAware is a new AI tool that is reinventing the way we inspect and maintain the electricity network. This tool was developed as part of our partnership with X (Google’s innovation lab) and Tapestry. It's Energy Moonshot division, and it's the first tool to be deployed on our network from this collaboration.
GridAware helps us improve our network inspection processes by using aerial imaging and data captured by drones and helicopters to give us highly detailed views of the condition of our overhead assets. This helps us prioritize our maintenance investment, but GridAware can also go further because as we use it, we're training AI to help us complete condition assessments of our network automatically. The Commerce Commission has recognized the customer benefit from this project, awarding us an innovation project allowance in the final year of the previous cycle known as DPP3. With this project in place, we're also the first distribution utility in the world to integrate another Tapestry tool that vastly speeds up our ability to assess future network scenarios. This helps us run long-term network solutions that help us plan for a range of different future scenarios.
This is extremely helpful to see the potential impact to the network of things like different rates of EV take-up, data centers, and rooftop solar. We now have a short video for you to help illustrate these projects and how they come together to benefit our customers.
It's a big job to make sure we give Auckland a reliable power supply. I've been working for Vector for 20 years. The capacity of our grid has obviously been impacted by electrification of cars and buses, so we've got to supply the infrastructure for them. A couple of years ago, we had Cyclone Gabrielle. We had power off close to 20 days for people. Historically, our service providers would actually walk the network and do a checklist and just make sure it's in good condition. We're trying to develop systems where we can identify early where our potential faults are going to be so we can get to them before they happen.
GridAware is an asset management tool. It uses machine learning to automatically detect the health of assets, which allows the human expert to focus on the strategic problems.
GridAware is a platform for us using helicopters and drones in a street view. All the imagery captured gets fed into the database. Once it's matured and is reliable enough, it'll be able to pick out the faults to know where we go.
Once you have the location, condition, and capability of the asset, you can start doing load flow simulations to help you plan what the network needs to look like in the future. You can now do a study for an area on the network in days instead of weeks. Tapestry has changed all of that.
Moving on now, in 2020, we set a target to reduce Scope 1 and 2 emissions, excluding electrical line losses, by 53.5% by 2030. This year, we recorded a reduction of 55%, which is calculated against the businesses we now have, meaning it reflects our actual emissions reductions, not from those businesses that we've sold. This means that as at June 30, 2025, we've achieved our 2030 target. We did this by innovation in technology and processes, and successful initiatives are now embedded into our operations. One of these initiatives is shown on screen, our gas sniffer trucks that proactively identify leaks from our gas network, enabling us to fix them faster and improve safety for our customers, as well as reducing the emissions from these leaks. We'll continue to focus on our emission targets because we know how important it is to maintain these reductions.
However, there may be some volatility in our overall emissions performance. This is especially true when factors outside our control come into play, such as severe weather that requires temporary generation to restore power, or third-party damage to our gas networks. I'll now move on to the wider energy landscape and some of the challenges we're seeing. An important issue for us is the reform to the electricity distribution connections as announced in July by the Electricity Authority. The key issue we were concerned about was that funding of connections and the potential of being required to move away from our policy of the people causing the connections' growth, paying 100% of those costs to a policy of the costs being shared across all Auckland consumers.
The EA or Electricity Authority is continuing to gauge on this, having deferred a final decision on the level of contributions that can be charged for customer connections. There were a number of technical changes announced, which will add complexity to what is already a highly complex process, especially noting that we do new connections of around 15,000 a year, more than any other electricity network in New Zealand. We'll need to make changes to our internal processes, and we'll do so within the timeframes that we've been given. The Electricity Authority has also expressed it is expecting some of these changes to be done in a nationally aligned way. We're already participating in the processes through our member association, Electricity Networks Aotearoa, and we'll continue engaging with the Electricity Authority as well. Looking to gas, there is unprecedented uncertainty around the future of natural gas in New Zealand.
This is driven in the near term by significant market uncertainty, scarcity of gas, and rising costs, and in the long term by lack of clarity over how gas distribution businesses will be impacted by New Zealand's 2050 net zero emissions targets. The current regulatory settings were designed in a more stable environment where demand for gas was growing, and we are urging the Commerce Commission to update them to recognize this uncertainty and to ensure any shift away from gas protects the interests of customers as well as stakeholders. A new draft gas default price path is expected to be announced by the Commission later this year, and we are participating fully in the process so the Commission understands our perspective both for investors and customers.
Key issues for us are that the Commission recognizes and responds to the context this reset is occurring in, which is the significant risk to gas revenues because of the near impossible task of forecasting gas volumes five years into the future, as well as medium to long-term risk that some of the gas distribution assets become stranded if the gas market scales down much earlier than is anticipated. As for the energy sector as a whole, the government hasn't yet released the report it commissioned to help with its review into the energy sector. We, like many others, are waiting to see the contents of this report and the government response. I'll now go over financial guidance we provided when we announced our results. As with the half year, we were providing guidance on adjusted EBITDA, gross CapEx, and capital contributions.
For financial year 2026, the range is shown on the slide. For adjusted EBITDA, the forecast increase on financial year 2025 is driven primarily because the financial year 2026 is the first full year of the new electricity price path. The forecast increase in capital expenditure is linked to expected customer-driven growth and our continued investment in the network. Before I close my address, I'd like to make a few comments as this is my last address as Vector Group Chief Executive. I feel incredibly privileged to have had a career in New Zealand's energy sector, firstly with ECNZ, then to Mercury Energy, and then on to Vector. The journey has been one of change, challenge, and continual growth, and for me personally, as well as for the sector as a whole. There are some constants that have always set Vector apart.
Vector has never been content to simply follow the easy path or do what others are doing. Instead, we've constantly taken the deliberate approach to develop and articulate our own view, even if it sets us apart. We've always tried to put the customer at the center of our thinking. We don't just look within our own sector for answers, nor do we just look into New Zealand. We look outside the energy sector and where innovation and forward thinking is happening globally to find the right skills and perspectives. Our views aren't always welcomed, but we've always believed in articulating our position so that people know exactly where we stand, even if they may not agree. We like to challenge ourselves as well as the wider industry. Consumer expectations have grown immensely, and that's a real challenge for the energy sector where you can't build big things overnight.
When you're facing such a complex challenge as we are with the energy transition, you can't just settle for the status quo. Our willingness to have a view is why we've been able to partner with global leaders like Google and Amazon. They looked around the world and found it refreshing to work with a company like Vector that stands for something. These partnerships and others before them with Palantir and Tesla have provided our staff with invaluable experiences and relationships that are far more useful than simply sitting at home in our corner of the world thinking we have all the answers ourselves. Being a regulated entity as part of our portfolio also brings its own unique challenges. We've had the privilege of running non-regulated businesses in highly competitive markets like gas trading, fiber, and metering.
With other parts of our businesses being regulated, I sometimes hear comments that this means we don't have the same competitive pressure constantly driving us. Make no mistake, everyone at Vector is committed to doing the right things. Our teams and our field service providers are out there every day working for customers, and in storms, they're outside in all conditions rallying to get the power back on quickly and safely as they can. Over my time with Vector, we've managed a large portfolio of assets, including some that are regulated and many that are in competitive markets, including technology startups. We've known when to invest, when to grow, and when to exit. In most cases, we've picked the right time to exit so we could invest in growth businesses. Sometimes because the risk outlook wasn't where we wanted it to be.
For example, we divested the Wellington Electricity Network and invested in Metering. We exited gas transmission and gas processing, trading, and distribution because we saw the risk profile just wasn't where we wanted it. Now we have a more electricity-centric focus, and that's timely because electricity is what the world needs more and more of now and into the future. Looking ahead, I was recently asked if there will be more energy shortages, and given the dry year risk hasn't gone away and we're seeing more extreme weather conditions all across the country, I think it's highly likely there could be more energy shortages. In the past two years, what I call the hope strategy has kicked in, and then it rained. There's no clear strategy or plan or accountability over the whole energy system as a whole.
Finally, I'd like to thank all our staff, field service providers, and Telnet for their huge efforts every day to deliver to our customers. I'd also like to thank all our service providers for the huge amount of work they do to support us. Special thanks also to the Vector board, past and present, for their support and challenge, and to all our shareholders, including interest for your support over the years at Vector. Thank you very much.
Thank you, Simon. Now we'll begin working through our agenda items. The notice of meeting lists the items for voting, and those eligible to vote, can I remind you, you can do so now at any time. Only shareholders registered at 5:00 P.M. on Friday, the 26th of December 2025, or their proxies or representatives may vote.
The first agenda item is to invite questions on my and Simon's reports for the financial year ended 30 June 2025, contained in our annual report and delivered today. Questions on future performance will be addressed in general business. The annual report was published online on 25th of August 2025, and hardcopy reports were sent to all shareholders who requested one. Questions on this topic may be put directly to our external auditors, KPMG, but please keep those questions relevant to their auditing role. If there are any questions in respect of the annual report, the financial statements, and audit report for the year ended June 30, 2025, please raise your hand and wait for my signal and a microphone. Are there any questions? We have one down here. I know who you are. I think I can see through the light. That's you, Coralie, isn't it?
It is. You're talking about energy generation, and it sounds like there is a real risk of shortages, especially with the data centers. There's also talk about mining coal at Huntly to burn. Now, is there anybody investigating tidal power in New Zealand? They've got it in the U.K.. I've seen it on TV and programs. With our coastline, surely there's a place to start looking at tidal power.
I'd have to say I'm not aware of any serious investigations of tidal power. I think experience overseas has shown that it's a high-risk venture. There are a lot of things in the natural environment that get accentuated in a tidal environment that are difficult to control. We still have so much potential for generation in wind and solar. I'm not sure there's a big need for us to be looking for other sources of energy at this stage, but more to capitalize on the sources we know and we have in abundance.
That takes the generation gentailers to actually do it, doesn't it? At the moment, they're not motivated.
That would have to be a question for four other general AGMs, I think, not for me.
You talked about energy supplies, so I don't go to those other meetings. I'm sorry, you're my last resort.
Right. The premise of what you're saying is absolutely true. We are in danger of energy shortages. I don't think we lack sources of energy, potentially. We just haven't built new generation fast enough. I've heard the generators talk, and they are doing a lot of investment themselves, as are others in the solar field and the wind field. I think we just have to park that one for the moment. I can't give you a definitive answer. Any other questions? Okay, there's no other questions in the room, so can I ask if there's any questions from shareholders watching online? Sophie, do I look to you for that answer? There are no online questions at the moment. Okay. All right, thank you. That ends the questions in relation to that agenda item.
The Vector Board considers its mix of skills and experience carefully, and we appoint new directors to complement the skills of those already serving on the board. Today, Vaughan Busby, who was appointed by the board in June, stands for election. Alastair Bell, Paul Hutchison, Paula Rebstock, and I retire by rotation and stand for re-election. I will invite Paul, Alastair, Vaughan, and Paula to each speak briefly, and I'll also make a short speech regarding my re-election. Given that there are five speeches today, we won't take questions as we go, but we'll take questions as a group at the end, if you don't mind. Vaughan, would you like to step up?
Good afternoon. Just before I begin, there's something I probably need to clarify, and that's despite press reports of the country, I'm not actually an Australian. I'm a Kiwi who's living in Australia. I'm sure all the New Zealanders in the room, which is probably all of you, will understand the need to make that clarification. I actually grew up in Tudungi, and before heading offshore, I lived in Auckland for about eight years. All my family still live and work here in Auckland. By way of background, I've got over 20 years' experience in the energy industry, everything from energy trading, building generation, both renewable and thermal, smart metering, which is obviously an important business line for Vector.
I've run retail businesses and have been involved in the development of software for energy trading and to facilitate the physical dispatch of energy in national and regional markets in New Zealand, Australia, Asia, and Europe. For the last nine years, I was actually Non-Executive Director of Energy Queensland, the largest electricity distributor in Australia. I've sat on numerous boards, including listed companies, private companies, and government-owned corporations. Should you support my election today, I'm sure my energy and technology background will add value to Vector. I also see another area where I think I'll be able to add value is by providing a slightly different insight and perspective, having operated in different jurisdictions, as to the way they are tackling energy issues.
Obviously, electricity and gas are critical to an economy, and New Zealand is facing some real challenges with regard to the supply of energy and its impact on the cost of living. Australia actually has many of the same issues with regard to electricity and gas that New Zealand does. However, they stem from slightly different causes. I see a real difference between Australia and New Zealand in terms of making policy decisions that require bold changes. With my energy and technology background, combined with having operated in different markets, I believe I can add some real value to the Vector business and tackling the various issues that are being faced in the New Zealand energy sector. I'd appreciate your support. Thank you.
Mr. Chairman, Simon, shareholders, I'm Alastair Bell. Thank you for your nomination for re-election to the board. Since joining the Vector board in 2019, I've seen firsthand both the opportunities ahead for the business and the responsibilities we hold as stewards of this essential company. Vector sits at the center of a rapidly changing energy system. Energy consumers, energy sources, and energy distribution are all evolving at pace. Vector can look ahead to a power system that is more electricity and data-centric. Vector plays a critical role for its consumers and for Auckland. Our job is to keep energy distribution reliable and affordable while investing for the future. The cost of delivering energy to consumers, whether businesses or households, is a constant consideration and an appropriate constraint.
It's right too that intergenerational considerations ensure the enormous capital costs of delivering, upgrading, and growing Vector's assets and infrastructure are balanced fairly between today's consumers and future generations. Vector invests half a billion dollars annually into its networks. Power outages are within regulatory limits. Vector's greenhouse emissions are falling, its balance sheet is strong, and its dividend per share has increased. Customers are at the center of Vector's Symphony strategy. Excuse me. Digital technologies and data solutions are leading changes in how Vector delivers. As well, our network businesses are capital-intensive and long-term return profiles. Vector wants to balance this by providing technology and services with shorter paybacks, for example, VTS. These will augment adjacent businesses such as the Bluecurrent joint venture. As a non-independent director, I represent Entrust, Vector's majority shareholder, alongside Dr. Paul Hutchison.
Entrust's 368,000 beneficiaries are all consumers on the Vector network in Central, East, and South Auckland. This unique ownership structure aligns Vector's interests with those of its consumers. Just last week, Entrust delivered its share of Vector's dividend directly to those Auckland households and businesses, amounting to over NZD 125 million into Auckland's economy. The Vector board, of course, works for all 630,000 electricity consumers and 120,000 gas consumers across Auckland. It's a privilege to work alongside our independent directors, led by Doug McKay, and with Simon Mackenzie and his executive team. Simon's retirement marks an important milestone, and his leadership will have left a lasting impact on Vector and the wider energy sector. He departs with our gratitude and best wishes. I'm seeking your support for re-election today. If elected, I will continue to work collaboratively to deliver value and sustainable returns for you, our shareholders. Thank you.
Good afternoon, ladies and gentlemen. Mr. Chairman, thank you very much for the opportunity to speak as I seek to be reelected to the Vector board as a non-independent trustee director. From the outset, I want to emphasize my support and enthusiasm for Vector as it leads New Zealand and well beyond our shores in creating a new energy future. By way of background, I was privileged to join the Vector board in 2021, and I was first elected to Entrust in 2015. Vector has to date been a leader in transforming its own business, grounded in data and insights, and smartly using technology to benefit customers. Customers remain at the center of our Symphony strategy, and I see my role as continuing to support this focus, challenging and questioning where appropriate.
As an Entrust director representing a large part of the Auckland community, this focus is especially important to me. As one of five trustees of Entrust, we are committed to doing everything possible to increase and protect your dividend alongside prudent financial management, ensuring reliable and affordable power supply, supporting the transition to a low-carbon energy future, and investing in innovation and digital solutions for the benefit of energy customers, and finally to continue undergrounding power lines where appropriate. As a trustee director, I strongly support the ongoing growth of a constructive relationship with the Vector board and management. My position on the board means I can positively contribute to these important matters and focus on representing the interests of all Vector shareholders. As a medical practitioner, I've been very encouraged by the way Vector proactively manages the health, safety, mental health, and well-being of Vector's people.
Their best health is vital to the success of the company. It's been very exciting and rewarding being on the nominations committee, leading to the appointment of Chris Blenkiron as the new CEO. I'm confident Chris will build on Simon's magnificent legacy. A huge personal thank you to Simon for the incredible hard work and leadership you've demonstrated over so many years, both at Vector and on a national basis. You're a constant source of inspiration. Thank you very much for the opportunity to serve on the Vector board. I greatly appreciate your support.
I'll go now. It is a privilege to put myself forward for a second term as a Vector Board Member. I joined the Board originally in 2022 and then became your Chair in 2023. I covered my relevant history and background when I was first elected, so I won't repeat all that. More important, I think that I summarize what I have contributed in the last three years. I count my major contributions as, one, the driving force behind the reshaping of Vector's business portfolio. We divested our gas trading and On Gas assets at a time that maximized value and took into account the state of the gas market and their risk profile. Overall, these businesses performed well for our shareholders over time, and we believe we exited at the right time for Vector. HRV did not meet our performance expectations, and that sale was completed just after balance date.
We have now cleared the decks for an unambiguous focus on succeeding with Bluecurrent and Vector Technology Solutions. We now have a balance sheet that also gives us scope to explore other growth options. Bluecurrent and Vector Technology Solutions originated out of the needs of our core electricity business, where we are subject matter experts. They both support the energy transition and play to the macro trends of distributed energy, network management, and optimization through digital solutions, empowering customers to adopt demand response solutions and all of us using energy more efficiently. As well as our core focus on providing reliable and affordable energy for Aucklanders, with these remaining businesses, we can grow here at home, in Australia, and internationally, leveraging a few but deep core competencies. Secondly, for near on a year, I have led the search for a new CEO to replace Simon .
We have been extremely focused and demanding to get the right individual. Simon, after announcing his intention to retire after 17 years as our CEO, has worked with me to ensure there is a seamless transition and landing on the search. My fellow directors have all played a part in ensuring the best possible outcome in securing Chris Blenkiron. Chris will join us before Christmas and get some weeks of valuable overlap with Simon. Your company will be in good hands. Thirdly, I have led and refreshed the board with exciting new talent, and Vaughan Busby is seeking your support today. In addition, each incumbent board member has decided to stand again, so we get important continuity at this time of important change in the company and the industry.
Fourthly, the board has a very constructive and open relationship with our majority shareholder, Entrust, and I would like to acknowledge Entrust Chair, Denise Lee, for her role in that. This is an important relationship to get right, and we work hard to achieve it. Five, we landed a good regulatory outcome in the five-year DPP4 path through FY 2024-2025 and again engaged constructively with the Commerce Commission. Despite not always being in agreement, we found a way to work with that. These outcomes are the most important inputs to our business every five-year regulatory period. For those five contributions that I thought I should highlight today, of course, there still remains much unfinished business, like building even more customer focus into every interaction we have with them, making us easier to deal with. An internal culture with more challenge and urgency remains a high priority for me.
Vector is an excellent business, well run by an experienced and talented management group. I want to ensure, though, we are getting the most out of the company for shareholders, customers, and the people of Auckland. If I can have your support, this is what I intend to focus my efforts on over the next three-year term, and I thank you in anticipation of that support.
Good afternoon, shareholders. It was a privilege in 2019 to join the Vector board and have the opportunity to contribute my infrastructure, energy, and regulatory experience to Vector. I'm pleased today to offer myself for re-election. Looking ahead, Vector, as the nation's largest electricity network, is well positioned to support Auckland as it continues to grow. Not only will Vector provide a reliable network that keeps all these lights on, we are committed to our vision of creating a new energy future, which we've heard a lot about today. In practice, our strategy at its core is not just about utilizing technology to deliver energy in the most cost-efficient manner. Importantly, it's about meeting changing consumer demands, responding to climate change and the need to decarbonize, and ensuring reliable and affordable energy solutions.
In my tenure at Vector, I've served at different times on each of the board's committees, including currently the People and Remuneration Committee, the Finance and Audit Committee, and the Nominations Committees. As the current Chair of the People and Rem Committee, I've had the chance to support Vector's commitment to develop our people, undertake succession planning, and continually improve workplace culture and the health and safety and well-being of our workforce. Previously, I had the great pleasure of serving on the Meter Transactions Subcommittee, which led to our partnership with QIC, currently called Bluecurrent. Subject to that transaction, I was appointed as a Vector Director on Bluecurrent, Australia, and New Zealand. Not only has that transaction resulted in Vector having a strengthened balance sheet, Bluecurrent has grown and contributed to Vector's financial performance in line with our expectations at the time of the transaction.
I'd just like to acknowledge that since I've been on the board of Bluecurrent, I've had the pleasure to serve with Simon Mackenzie as one of our other directors. It's been really beneficial to Bluecurrent to have the person who grew that business from the ground up continue to support it. I probably am particularly pleased that Simon will be continuing on the Bluecurrent board for a period going forward. Having said that, like my colleagues, I want to acknowledge his outstanding leadership while he's been the CEO of Vector. My previous governance roles include chairing the Commerce Commission and the ACC and being a director of several infrastructure companies like KiwiRail, AT, Auckland One Rail, and SeaLink, among others. Furthermore, I currently chair Aunui Labs, New Zealand Post, and I'm Deputy Chair of NZX and AIA Insurance.
Having started my career as an economist, I have a strong interest and focus on business performance and strategy amongst the companies I serve. Looking forward, I would welcome the opportunity to continue to govern and grow Vector for the benefit of its customers and shareholders. I have the passion, focus, and time needed to support the achievement of Vector's vision. I've appreciated the opportunity to address you all here today, and I seek your support for my re-election as a director. I'll hand back to Doug. Thanks.
Right. Thank you all. Could I ask if in the room there are any questions for the standing directors? Sorry, it's just a bit difficult to see out there with the spotlights. Okay, we have a question here.
Afternoon, Grant Plummer, shareholder and recipient of Intrust dividend as well. Thank you. With the movement into, part of the address was the movement into using AI, what directors have skills in that area, and what's the future with AI?
Good question, Grant. Thank you. Look, I probably am stepping out on a limb here. I don't think any directors have sufficient direct experience with AI given how new it is and given how we developed our careers over the last few decades. Let's be very clear about that. We are partnering with people who are experts in AI in the areas where we think that's going to have the most early and significant impact. Simon referred to Google, X (Google’s innovation lab), AWS, and people like this. Many businesses now are working out how they are going to cover the AI opportunity and the AI challenge, and we're no different from many.
This afternoon and morning at our board meeting, for example, we approved our first AI use policy. This is how we are going to have AI used and available within the company for our employees to use in all sorts of different ways. We're at the very early stages. I don't want to gild the lily here. We'll be buying in or consulting for that expertise when and if we see opportunities that we need to get moving on quickly. Over time, I think as we recruit and plan succession for new directors, a technology emphasis, including AI, will become much more a part of that recruiting brief and looking for people who are more advanced in their experience with AI than the current crop. Sure. Microphone's on its way.
A question for Vaughan responding to the directors' speeches. I understand you're domiciled in Australia. Will you be physically attending meetings, board meetings in New Zealand? If so, who bears the cost of that? Thank you.
Yes, I am domiciled in Sydney, and I am attending all meetings in person, physically. Yet the company does bear the cost of that. Going back to that previous gentleman's question, I do have some experience in generative AI.
Yes, if you recruit an overseas director, I'm very certain that the policies companies have is they pay the travel costs, accommodation costs for the director to attend the meetings in person. I'm not aware of any company that doesn't do that. We have a director based in Wanaka, for example, Anne Urlwin, and that same policy applies in Anne's travel to and from Wanaka to be here for meetings. Vaughan came in a day early to this board meeting today because we had a workshop yesterday, for example. He is very accommodating and knows that the expectation is he turns up in person. We're not doing it on the phone or on a Teams call. He comes out in the field. We've all had days out in the field with our staff and field service providers last week in the weather.
You know Vaughan will be here for those opportunities as well.
If you're doing 15 trips a year, would that be three?
I don't think it'd be that many. We're probably, John, what, eight or nine board meetings a year? Yeah, you could possibly double it for all the other interactions that I definitely would expect Vaughan to be having as if he was living and based here in Auckland. It's very difficult to find the experience in electricity networks in New Zealand at the size, the scale, and the sophistication that we operate at.
In fact, a couple of thousand electricity companies provide for shareholder members.
Yeah, exactly. That experience, relevant experience for us, is resident in Australia. I'm continually thinking about how many offshore, how many onshore directors is the right balance. At the moment, Vaughan's our only offshore director, and it's working very well. We've had nearly a year's experience, sorry, three or four months of experience working with Vaughan. I'm confident that we found the right person for the right reasons. Are there any other questions in the room before I go online? No, okay. Sophie, any questions?
No online questions.
We'll have general business questions in a minute. Yep.
No director questions online.
No questions online. Okay. The proxy voting positions for these resolutions are now shown on the screen. Okay. That's very good. Thank you. The next item of business is the proposed increase to the directors' fee pool. We've carried out a benchmarking exercise with PWC. We've put that online, that paper from PWC online for shareholders to see. We propose an increase to be spread over two financial years as detailed in the notice of meeting. Are there any questions on this resolution from the room? Yes, down the front. Richard, we'll just get a microphone for you so others can hear you. I can hear you from here,
Richard Jenkins, shareholder, when was your last fee increase?
The last fee increase was two years ago. The increase before that was 13 years ago. We've been a bit schizophrenic, frankly, about how long we wait between increases.
Thirteen years was unacceptable, totally unacceptable. I want to move, and that's what this proposal recommends, to smaller and more frequent increases, perhaps every two or three years, depending on the market. If the market's saying there's no justification, then we won't put one up. We've clearly felt that there is justification for these modest increases over the next two years. Let's keep an eye on the market so that we don't have these big, long interregnum periods where we don't change, and then you've got to come and ask for a massive change, which might be at a very difficult time in the business cycle. That makes it even more challenging. I think small and regular is sort of what I would like to be moving to. Are there any other questions in the room? Okay. Sophie, are there any questions online?
No online questions.
Okay. Thank you. The proxy voting position for this resolution is now shown on the screen. I now move to the appointment and remuneration of the auditor. Under the Companies Act, the company wishes to record the automatic reappointment of KPMG as auditor. The company also proposes that the board be authorized to fix the auditor's fee for the ensuing year. Are there any questions on this resolution in the room? Okay. Are there any other questions online, Sophie?
No.
Thank you. That ends the questions in relation to this resolution. The proxy voting position for this resolution is shown on the screen. We have now finished all ordinary business, and I would like to open for any items of general business to be discussed or questions to be raised. As a reminder, acknowledging the interests of shareholders, please do not ask specific operational or customer service questions. Members of our customer team are available here in the room today, and we'll be very happy after the meeting to take these types of questions. Let's start with those questions in the room, and I know we have one flagged down here in the aisle, please.
Thank you. This would be directed, I think, to Simon about the cost of power pole replacement. In my street this year, there's been two power pole replacements earlier in the year.
One of them, there were 17 people on site and three vehicles for a whole day. We were out there in the evening waiting for it to be finished, talking to neighbors, and estimating the cost of replacing one power pole is probably between about NZD 8,000 and NZD 12,000, which seems extraordinarily high for one power pole. There was another power pole done two months later, and that had 23 people on site, +6 vehicles. Would these costs be approximately correct, and is there any way of reducing those costs? I'm sure you're looking into it, but I'd like an answer in person. Thanks.
Obviously, the costs of each pole replacement vary depending on what material we're using, what size of pole. Sometimes we put in double poles. That's probably around the ballpark.
One of the big challenges we do have, which we have been seeking to address with Auckland Transport, is all the traffic management requirements. Those are extremely material, and it's not just putting the pole, but typically it's also how we do the line connections and the requirements. I don't obviously know what road you're on, but there are very specific Auckland Transport requirements for traffic management, which we do seek to basically continually challenge with Auckland Transport. In the order of 45% of project costs are basically traffic management related. That is one of the challenges that we do have. We continue to look for ways to utilize as efficiently as we can with some of the projects, like pole replacements, new cross arms, and at the same time, they'll undoubtedly be putting in a new pole, new cross arm, and so forth.
There's a bit more to it than just the concrete pole. I think that's just the reality; the challenge does typically center around the safety, which we can't compromise, but also those external factors rather than just putting the pole in the ground.
Dr. Paul Hutchison and I were out for half a day last week in the weather on East Coast Bays Road replacing six poles. We were just watching how our teams work that process. Like your observations, there were a lot of trucks and a lot of people. When you've stood out on the footpath and talked to the teams and watched what they do for three or four hours, you understand why each of those pieces of equipment is necessary.
For example, the hoist truck that lifts the people up to the top of the cross arms at the top of the pole, and you've got one person on one side of the pole, one person on the other side disconnecting the power lines after somebody else has been earlier and turned off the power for that whole area. You've got two people up there that have been hoisted up. They've got to disconnect all the cross arms, take down the lines, carefully drop them. There's somebody down on the truck managing that hoist. There's another person down on that truck putting the new cross arms and all the gear that needs to be installed to replace. There's another truck that needs to come along with a crane that lifts the pole out when it's disconnected, and another truck turns up to bring the pole that's going in.
You get where I'm going. It doesn't take long. There were two traffic management vehicles on East Coast Bays Road, if you can imagine, very busy road. It's almost like a highway. You had to have one stopping the cars at that end and the other stopping the cars at that end. You had a driver on each of those trucks, and you had two people doing traffic management who then walked out into the road to make sure that it was all clear as we dropped a line from one pole on one side of the road to a pole on the other side of the road. Had to roll that cable up, carefully place it on the other side, and then open up the traffic again.
It was all done within three or four minutes, but there were 40 minutes, there was 40 minutes- 60 minutes of preparation to get that three or four minutes of clear space. I had the same reaction to you initially driving out. Oh my God, look at all these trucks and these people. There was another interface that we observed. A supervisor had to deal with a neighbor who was not happy about the trucks being over their driveway. We weren't prepared to stay till 6:00 P.M. because the power might not have gone on, and I wouldn't have liked to have dealt with the neighbors at that stage. Very complex.
I guess what Simon was saying, that number 45% was the cost of.
Traffic management. Sorry, the cost of traffic management was 45%. Did I get that correct?
Traffic and traffic management typically cost around that, yeah.
Certainly, traffic management has increased significantly, and we're now starting to grapple with new rules being put in by Auckland Transport about times in which you can operate. You get into this challenge to the point around if we can't operate on some arterial roads and we can't start till 10:00 A.M. and have to be finished by 3:00 P.M. and basically remove all the traffic management cones and everything, pretty much the only way to get the job done quickly is to put more people into it. There's a raft of those kind of complexities.
That would be adding?
I think that's all. Hello? Right.
Hi.
That would be adding to cost the increased requirements from Auckland Transport. Yeah.
We believe that does.
Magically now, Auckland Transport is going to report to council. Everything's going to be better, maybe.
Yep.
My overwhelming impression, despite the observation of how many trucks, how many people, was just how committed and how expert our people were. Incredible. I was literally blown away by the skill and the agility and the ability to think on their feet. Because remember, no one workplace for Vector is the same. You don't go to the same bench and work every day. You don't go into the same factory every day. You don't go to the same office. You turn up on a job and everything is bespoke for that job that day.
I would have to say, being registered.
I have to say, being registered, we were getting texts. One of those jobs ran till nearly 8:00 P.M., and we were getting texts about every hour telling us, "No, it's still delayed. It's still delayed." You weren't having to wander down and talk to the people and say, "Hey, you know, when does the power come back on?
Good.
Finishing a job too early creates its own problems too, because then people come out and say, "Why the hell did I organize to get the kids babysat for the whole day?" You know, you can't win. It'll over-deliver and you under-deliver at the same time. We understand all that. Try to do our very best. Have a question here.
I have one question, Mr. Chairman. There's been reports in the press that Vector could be in the position to export energy. The only thing is they didn't state in what form. I just wondered if you could enlighten us on this one.
I was trying to insulate you, Simon, but I have no idea how to answer that question.
No, that is a unique proposition, let's say, but certainly not electricity because we kind of barely have enough for ourselves. I'd only imagine that would be probably potentially if there were more gas finds, obviously coal, but other than that, there's really no other source of energy that we could export from my understanding.
The thing I've learned from it, they stated that this form of energy, whatever form it is, would be stored in Southland and then exported from Southland to wherever it's required. That's all I've been able to pick up. I just thought someone here might know about it.
Born, Australia is certainly hydrogen.
Hydrogen.
Right.
Where this excess energy in the market from, for example, solar, is converting that to create hydrogen and then shipping the hydrogen offshore. That said, it's been a lot slower to take hold and a lot more expensive than people thought. At the moment, to be honest, there's a big question mark as to whether it will happen in Australia.
Thank you very much.
Hi, Neil Anderson's my name. I'm a shareholder. I've got a question about solar on premises. There were questions for some of the Gentailers about solar on premises and why they're not supporting it. They seem to say that they thought it would disturb the market. I would like to know, as retailers, what's your view about supporting solar on people's properties or on business? At the moment, there is no support. In several countries, there is a lot of support for solar on premises. Here in New Zealand, zero. I would like to know what, as a retailer, your view is about that and whether you are thinking about supporting solar on your customer's premises.
I think it's well known that New Zealand has not had an incentive scheme running for solar or a subsidy scheme, whereas by contrast, Australia went all out to subsidize solar. That's the policy setting we deal with here in New Zealand. It's quite a mixed question between distributed solar on rooftops versus aggregated solar that is used to sort of fuel battery farms, and then that energy can be released when it's needed. I'll ask Simon to speak more technically about solar and what we at Vector can and cannot help with. Maybe Simon, would you be able to respond to that?
Sure. Yeah, I agree with you, Doug, that the New Zealand policy settings are very much market-oriented. The government has not had any intention to put in place subsidies like we saw in Australia. With regards to Vector as a distribution company, we support the ability for people to connect solar, to put batteries in. There are technical requirements for how they connect into the house, how that has to have what's called Bi-directional Metering, and the ability to isolate it because if, for example, a lineman is working on a line because there's a fault, you don't want the energy being fed back into the network and electrocuting the person. From our perspective, we do not retail electricity. We sell the line services. With regards to the points Doug raised, absolutely, we have people looking to connect solar farms.
Our focus is how do we connect them in and make sure they get connected into either our network or the transmission system. From a wider perspective, I think what we have seen is that solar typically is best paired up with batteries. The costs of the technology itself are coming down, but then the other side is the installation costs are very high. A lot of customers don't necessarily just want to put that upfront capital in. There are companies out there that provide, I guess, products and services for people to put solar and batteries into their homes. We have seen one of those, though, also recognizing in recent times SolarZero going into liquidation, which obviously couldn't sustain its business model.
One of the other challenges that has been prevalent in looking at solar and the economics of it is when is the solar producing and if you are exporting energy that you're not using in your home, is that actually getting a fair price in the market when people are buying it back? That's something that's still a hot topic of debate. I don't see that kind of market setting changing anytime soon. It will be left to people that might want to provide those solutions to consumers. One of the other unique characteristics that we've certainly seen in New Zealand is I think the average turnover of people in homes is something like seven years. The payback for solar, when you look at the upfront capital cost versus just buying the energy, it's quite a long payback period.
I can actually provide a context to the Australian, how it worked in Australia. In Australia, it was certainly a government subsidy. The government paid basically to encourage people to put solar panels on their homes. It didn't have anything to do with the retailers or the distributors or anything like that. Yes, it was wildly positive in terms of getting the number of solar panels on roofs to the point where they've taken those subsidies off and are looking at charging consumers the privilege of injecting power into the grid. It's almost come 360 degrees now.
Okay. In other words, no plans really from Vector to be involved in that. I have another comment actually on the way you run your business in this particular area, and that is Bluecurrent. I'm aware that whenever there's a problem with Bluecurrent, it's Vector who gets the phone call about my meter's not going or Bluecurrent having come and done whatever they should do with my meter. It's damaging your business that you're that down the track, Bluecurrent doesn't even do it. They get Ventia or some other contractor to come and do it. There's about three people clipping the ticket on the way through, and Vector is the entity where the customer sees a problem. Vector is where the problem ends up at.
Your call center gains the problem for the fact that Bluecurrent outsources it to somebody else who outsources it to somebody else, and you guys end up looking like the bad guy in this. That's because somehow the business practice is, we don't want to have to deal with that, we'll give it to somebody else to deal with. I think that you've got a very bad business model in that you're not taking, you don't have the ability to deal with the problems that come up from metering. Sure, you are when you're putting the poles in the ground and things. It's your guys going and doing it. It might be a contractor going and doing it, but it's under the control of Vector. Not when you're doing metering.
When you're doing metering, and I can tell you that from personal experience, but I don't want to raise that in the meeting. I just think your business practice needs to be looked at.
Okay. Thank you. I've got two directors of Bluecurrent here, so I'll maybe ask either of or both of them to comment. I personally don't have a problem with Vector's call center as the recipient for issues with the meter, and then we send that communication to Bluecurrent to take on the remediation. I think we've got those resources. We're a 50% shareholder in Bluecurrent. I don't think I really want Bluecurrent replicating all that cost when they don't need to. We've got it, and we've got a very effective call center. I'm not perturbed by that observation so much. I recently, just as a customer, had communication from Bluecurrent in the normal way that they needed to upgrade my meter on the gas connection to my home.
I'd have to say the whole, and it was a Ventia contractor who turned up to do it, the whole experience was just first class. They had no idea who I was. I think we all have our individual experiences, but I think we've got to be very careful that we don't jump to general conclusions about it because I acknowledge there's always room for improvement. Whether the business model needs changing, I think we are best placed to think about that and to recommend that. We would if we thought it was a good thing to do. Maybe I'll ask Paula or Simon or both to offer some comments.
Yeah. I guess the reality is with the metering business, the deployment and management of meters in the field has always been managed by our field service partners. Whether it's Ventia or other contractors, we did have a small contracting business that was managing some of it. Fundamentally, it's very hard to justify having the amount of people to manage all the metering fleet because utilization would have been exceptionally bad. Also, just because we cover all of New Zealand, one of the things where Ventia has been involved, and I'm not too sure if this has been your experience, we had to go through a changeout of all the communication cards in the meters right across the country because of the 2G cellular network being shut down. Ventia was our contractor that was doing that. By and large, they did a really good job.
Got through nearly 1.5 million m in a very tight timeframe to change out all the cards. There will always be areas where we can improve. Sometimes issues with metering can also just be passed on from retailers who may not know to contact Bluecurrent because of the changeover to Vector. Certainly, sitting on the Bluecurrent board with Paula, I want to also add that the whole service level and customer focus is something that we watch closely. We do very much look at how the contractor's performance is. To Doug's point, we don't always get it right. Absolutely agree with that. If we can learn from some of these things, we're happy to understand what went wrong.
I was just going to add a couple of things, just building on Simon's comments. It would be very hard for Bluecurrent, as it was for Vector, to directly employ the metering workers because it's quite sporadic. We might do a big rollout in a particular area, and then we don't need to be back there for a number of years. I think that part of the business model is driven really by the nature of the rollout and how often you need to go back for maintenance. We do keep really good stats on customer feedback. We have tended to perform extremely well in this market in New Zealand. Australia's always been a little more challenging for us, not just customer feedback, but generally in terms of getting the rollout at the scale and timing that we need. It is something that we focus on a lot.
I think if you do have particular feedback about your own situation, it'd be really great to feed that through to Bluecurrent. Like Doug, I had my meter replaced. It'd been in our home for a very long time. When the guy came to do it, I went out and he explained to me everything he was doing. It was quite an, I thought it was a great service. He had no idea that I was on the board of Bluecurrent and Vector, but he was very accommodating to explain to me what he was doing and how he was doing it. Again, he was a contractor. He wasn't directly employed by Bluecurrent. I agree with Simon. There's always room to improve. We do welcome the feedback where we need to do better.
If you had a personal experience that you think it would be beneficial for us to know more about, very happy to hear that after the meeting. Thank you. Thank you for your question.
Out the back. Hand up.
John Hume, a shareholder. You divested HRV. Did you make a profit or loss when you sold it? If so, how much?
We made a very significant loss on sale. We were losing significant amounts of money annually in the operating of the business, and we could not find or see a way to turn that around after numerous efforts and numerous changes. The business model became significantly impacted through COVID, given it was an operate in-home model. Contractors and franchise holders calling in on homes to install. COVID destroyed the business for a time. It also was a business that operated across New Zealand, and as you know, we are an Auckland-centric company. We could not, after a lot of effort, valiant effort, try and turn the business around. We could not see a way to stem the losses that that business was running year to year. We didn't sell it for a large amount of money.
We basically transitioned it to an existing franchisee who was willing to take on the risk and the challenge of running the business. That's the story with HRV. It's not a very good story.
Sorry, I didn't mean to say anything. There's no criticism of the HRV people. We just could not find, as the owner, a way to make it successful for us and our customers. Okay. There's no more questions in the room as far as I can tell. Any questions online, Sophie?
No, no questions.
That's got to be some sort of record. No questions online at all. All right. Thank you. That ends the questions in relation to general business and Q&A. I will shortly close the voting. I don't want anyone to not vote because they were surprised I closed it out. Please ensure that you have cast your vote while we wait a moment for final votes to be cast. Thank you for all your support of Vector as shareholders. I would also like to thank my fellow board members for their input during the year and Simon and his team for their performance throughout the year. The results of these votes will be released to the stock exchange tomorrow. It's a bit like an auction now. Any other bids? Has everybody voted? We'll collect the votes now. The Computershare people will come around and collect the votes. Last charge. That's great.
Really good. Okay. I'm going to declare voting now closed. The meeting is closed. Thank you again for joining us. A reminder that Simon and I and other members of the team will remain in the room in case there are any further questions over afternoon tea. Thank you very much.