Speaker 1: You're listening to a share these podcast. If you were
Speaker 1: an investor thinking about channel infrastructure as an investment, what
Speaker 1: would be the metrics that you would be looking at.
Speaker 1: We talked about dividend, so divin yield is one, but
Speaker 1: what are some of those other metrics that you would
Speaker 1: think about tracking over time to assess whether channel of
Speaker 1: structure is being well run and doing well.
Speaker 2: So the measure that I would look at so this
Speaker 2: dividend and free cash flow? Right, and the reason that
Speaker 2: free cash flow is so important and actually you look
Speaker 2: at it across any business you invest in, not just channel.
Speaker 2: You know that is a true measure for the cash
Speaker 2: that the business is producing. And so you know ebit
Speaker 2: DA can have. You know, when people talk about revenue
Speaker 2: and ebit DAR, there's pros and cons with those measures,
Speaker 2: but free cash flow is the earnings less the sustainable capex,
Speaker 2: less your interest costs. So you know, it's a true
Speaker 2: measure of the cash that the business is producing. And
Speaker 2: I think cheerholders should look at that. I wouldn't want
Speaker 2: to give anybody any financial advice, but I certainly look
Speaker 2: at it at any investment that I look at, not
Speaker 2: just not just channel and that's a metric that we
Speaker 2: are focused on as a company because you know, we
Speaker 2: need to balance the long term nature of our business
Speaker 2: and making sure that we make good, disciplined investments in
Speaker 2: our assets to ensure that they're there for a very
Speaker 2: long period of time. So that's covered in the capex
Speaker 2: part of it, and then there's the earnings part of it,
Speaker 2: or the cash that the business generates as well, which
Speaker 2: is a reflection of the enterprise or the job that
Speaker 2: we do.
Speaker 1: Your background is that you've headed up M and A
Speaker 1: for a large recent bank. Outside of maybe those terminal assets,
Speaker 1: is there any other sorts of assets that could be
Speaker 1: quite attractive, particularly because of maybe capabilities, expertise, other sort
Speaker 1: of assets and experience that channel might have that they
Speaker 1: could leverage.
Speaker 2: Yeah. One of the lessons that I've learned from I'm
Speaker 2: doing twenty years of M and A is you need
Speaker 2: to look really long and hard at what your own
Speaker 2: capabilities are as a business and ask yourself, you know,
Speaker 2: can you actually manage what you're buying better than the
Speaker 2: person that's selling it to you? And I think in
Speaker 2: relation to terminals sets, you know, I think we've got
Speaker 2: we managed New Zealand's largest terminal by a country mile.
Speaker 2: We've made some really good operational improvements over the last
Speaker 2: couple of years. Really proud of the way the team's
Speaker 2: delivered that, and I think, you know, that's earned us
Speaker 2: the right to say, well, we are really good owners
Speaker 2: and managers of those assets. And so I think we're
Speaker 2: pretty disciplined about the types of sets that we'll look at, actually,
Speaker 2: and I think focused on those where we can add
Speaker 2: value as a management team and as as an operator,
Speaker 2: and sticking sticking to those now. It might be in
Speaker 2: the future that we build additional capability and we say, hey,
Speaker 2: we've got a capability that we can go and export,
Speaker 2: or you know, there's an asset that comes with the
Speaker 2: team that has a great cape ability. But I think
Speaker 2: for the business as it stands today, that's really our focus.
Speaker 1: So it's really asking the question, are we the highest
Speaker 1: value owner of the sasset? It's right, I'm not just
Speaker 1: trying to get a bargain for a sort of random
Speaker 1: messet that might not be so strategically aligned.
Speaker 2: You shouldn't and you can't do M and A for
Speaker 2: M and a's sake. You do it because you see
Speaker 2: it gives you a competitive advantages of business help solve
Speaker 2: your customers problems in our case, and that most importantly,
Speaker 2: we can add value to shareholders. And if it doesn't
Speaker 2: tack those boxes, then you know we shouldn't be doing it.
Speaker 2: Investing involves the risk you might lose the money you
Speaker 2: start with. We recommend talking to a licensed financial advisor.
Speaker 1: We also recommend reading product disclosure documents before deciding to invest.