Q2 2026 NZX Ltd Earnings Call

August 19, 2026

Speaker #1: Only mode.

Speaker #2: Good morning, everyone. Welcome to NZX's 2026 interim results call. I'm Grim Law, NZX's Acting Chief Executive, and I'm here with Amy Tropman, NZX's Acting CFO.

Graham Law: Good morning, everyone. Welcome to NZX's 2026 interim results call. I am Graham Law, NZX's Acting Chief Executive, and I am here with Amy Trotman, NZX's Acting CFO. Amy and I will take you through the interim result. I will lead off with the key elements of the interim result and the comments on NZX strategy. Amy will then step us through the financials. After which, we will be happy to take any questions. To ask a question, please use the Raise Your Hand button on the panel at the top right of your screen, and our moderator will send you a message request on mute. At which time, please state your name and then ask your question, and then go back on mute. Amy and I will then answer the question. Before we start, please note the important notice on slide 2 of the investor presentation. Next slide.

Graham Law: Good morning, everyone. Welcome to NZX's 2026 Interim Results Call. I am Graham Law, NZX's Acting Chief Executive, and I am here with Amy Trotman, NZX's Acting CFO. Amy and I will take you through the interim result. I will lead off with the key elements of the interim result and the comments on NZX strategy. Amy will then step us through the financials. After which, we will be happy to take any questions. To ask a question, please use the Raise Your Hand button on the panel at the top right of your screen, and our moderator will send you a message request on mute. At which time, please state your name and then ask your question, and then go back on mute. Amy and I will then answer the question. Before we start, please note the important notice on slide two of the investor presentation. Next slide.

Speaker #2: Amy and I will take you through the interim results. I'll lead off with the key elements of the interim result and the comments on NZX's strategy.

Speaker #2: Then Amy will step us through the financials, after which we'll be happy to take any questions. To ask a question, please use the raise-your-hand button on the panel at the top right of your screen.

Speaker #2: And our moderator will send you a message request to unmute. At that time, please state your name and then ask your question, and then go back on mute.

Speaker #2: Amy and I will then answer the question. Before we start, please note the important notice on slide 2 of the investor presentation—slide 2.

Graham Law: As that statement applies to all content and comments made by us during this call. Moving to slide 4, where we summarize the 2026 interim result. In the first 6 months of 2026, NZX maintained momentum in creating long-term value across its diversified financial markets infrastructure businesses, demonstrating NZX's resilience through diversity of product offering as a market operator, fund manager, and fund administration platform provider. The period again tested market confidence. Geopolitical tensions added to investor uncertainty and contributed to periods of market volatility. At the same time, New Zealand continued to face the effects of a slower economic cycle, cautious business investment, and subdued equity market issuance. Notwithstanding the macroeconomic environment impacts, NZX has delivered a solid half-year result.

Speaker #2: As that statement applies to all content and comments made to us during this call. Moving to slide 4, where we summarize the 2026 interim result.

Speaker #2: In the first six months of 2026, NZX maintained momentum in creating long-term value across its diversified financial markets infrastructure businesses, demonstrating NZX's resilience through diversity of product offering as a market operator, fund manager, and fund administration platform provider.

Speaker #2: The period again tested market confidence. Geopolitical tensions added to investor uncertainty and contributed to periods of market volatility. At the same time, New Zealand continued to face the effects of a slower economic cycle, cautious business investment, and subdued equity market issuance.

Speaker #2: Notwithstanding the macroeconomic environment impacts, NZX has delivered a solid half-year result. Operating earnings, excluding project and restructuring costs, were $27.3 million, an increase of 8.8%, resulting in net profit after tax of $9.8 million, up 18%, which equates to earnings per share of 3.0 cents, up 17%.

Graham Law: Operating earnings, excluding project and restructuring costs, were NZD 27.3 million, an increase of 8.8%, resulting in net profit after tax being NZD 9.8 million, up 18%, which equates to an earnings per share of 3.0 cents per share, up 17%, and has allowed us to declare an interim dividend, fully imputed, of 3.2 cents per share, an increase of 6.7%. Moving to slide 5. NZX continues to implement the strategic priorities to deliver value to our shareholders. In the current period, we have made good progress in areas that will support stronger capital markets over time. These include improving market settings, launching the new S&P/NZX 20 Index Futures product, supporting greater market participation, growing Smartshares and expanding NZX Wealth Technologies. I note that these key metrics are reported to the market on a monthly basis.

Speaker #2: This has allowed us to declare an interim dividend, fully imputed, of 3.2 cents per share—an increase of 6.7%. Moving to slide 5, NZX continues to implement our strategic priorities to deliver value to our shareholders.

Speaker #2: In the current period, we have made good progress in areas that will support stronger capital markets over time. These include improving market settings, launching the new S&P/NZX 20 futures product, supporting greater market participation, growing Smart, and expanding NZX Wealth Technologies.

Speaker #2: I note that these key metrics are reported to the market on a monthly basis. Slide 6 summarizes NZX's strategy, which continues to focus on expanding the depth, reach, and resilience of New Zealand's capital markets.

Graham Law: Slide 6 summarizes NZX's strategy, which continues to focus on expanding the depth, reach, and resilience of New Zealand capital markets, while driving scale and operating leverage across our interconnected financial markets infrastructure and funds management businesses. Our strategy continues to be one of evolution and optimization. In the next few slides, I will go into more detail on the business unit strategies. NZX's role is to ensure New Zealand capital markets remain trusted, relevant, and ready for the future. In 2026, the case for stronger capital markets is clear. New Zealand needs deeper pools of capital to support business growth, innovation, infrastructure investment, and productivity. Public markets have an important role to play in that. Growth in the public markets provide an opportunity for future KiwiSaver growth to be invested in New Zealand rather than offshore.

Speaker #2: We're driving scale and operating leverage across our interconnected financial markets infrastructure and funds management businesses. Our strategy continues to be one of evolution and optimization.

Speaker #2: In the next few slides, I will go into more detail on the business unit strategies. NZX's role is to ensure New Zealand capital markets remain trusted, relevant, and ready for the future.

Speaker #2: In 2026, the case for stronger capital markets is clear. New Zealand needs deeper pools of capital to support business growth, innovation, infrastructure investment, and productivity.

Speaker #2: Public markets have an important role to play in that. Growth in the public markets provides an opportunity for future KYC-saver growth to be invested in New Zealand rather than offshore.

Speaker #2: The capital markets strategy we have been implementing over recent years remains the right one to deliver value to our shareholders in New Zealand. Expanding the capital markets product set, improving market liquidity and participation, supporting stronger public market settings, enhancing our data and information services, deepening international partnerships, and continuing to invest in reliable, secure, and resilient technology.

Graham Law: The capital markets strategy we have been implementing over recent years remains the right one to deliver value to our shareholders in New Zealand. Expanding capital markets product set, improving market liquidity and participation, supporting stronger public market settings, enhancing our data and information services, deepening international partnerships, and continuing to invest in reliable, secure, and resilient technology. Moving to capital markets listing activity on slide 9. Despite global uncertainty, listed NZX issuers continued to use the market to raise capital. The capital listed and raised was NZD 6 billion year to date, up 25.2% on the prior period, excluding the Fonterra Co-operative Group's transfer to the NZX Main Board last year. New capital listed was NZD 2.5 billion, up 69.1% on the first half of 2025, excluding FCG. This was a tale of two quarters.

Speaker #2: Moving to capital markets listing activity on slide 9. Despite ongoing uncertainty, listed NZX issuers continued to use the market to raise capital. The capital listed and raised was $6 billion year-to-date, up 25.2% on the prior period, excluding the Fonterra Cooperative Group's transfer to the NZX main board last year.

Speaker #2: New capital listed was $2.5 billion, up 69.1% on the first half of 2025, excluding FCG. This was a tailored Q2. Q1 continued the strong listing momentum from the latter part of 2025, with the listings of Rua Gold and Talo Critical Minerals.

Graham Law: Q1 continued the strong listing momentum from the latter part of 2025, with the listings of Rua Gold and Tāiko Critical Minerals. In Q2, primary equity issuance was subdued because of the war in Iran. Secondary capital raised was NZD 3.6 billion, up 5.9% year on year. This highlights the ongoing value of NZX markets for existing issuers seeking capital to strengthen balance sheets, fund investments, and support long-term growth. Our focus remains on ensuring companies understand the benefits of public markets, access to capital, liquidity, public profile, governance discipline, and long-term ownership options. NZX Capital Markets listing team continued to focus on building the future listings pipeline, including having deeper engagement with private companies, investment banks, law firms, accounting firms, private equity sponsors, brokers, advisors, and founder-led businesses. We have also been facilitating investor direct access to senior leaders from companies at pivotal stages of development.

Speaker #2: In the second quarter, primary equity issuance was subdued because of the war in Iran. Secondary capital raised was $3.6 billion, up 5.9% year-on-year.

Speaker #2: This highlights the ongoing value of NZX markets for existing issuers seeking capital to strengthen balance sheets, fund investments, and support long-term growth. Our focus remains on ensuring companies understand the benefits of public markets: access to capital, liquidity, public profile, governance discipline, and long-term ownership options.

Speaker #2: The NZX Capital Markets listing team continued to focus on building the future listings pipeline, including having deeper engagement with private companies, investment banks, law firms, accounting firms, private equity, sponsors, brokers, advisors, and founder-led businesses.

Speaker #2: We have also been facilitating investor direct access to senior leaders from companies at pivotal stages of development, our headline event being the inaugural NZX Resource and Exploration Investor Day.

Graham Law: Our headline event being the inaugural NZX Resources & Exploration Investor Day, which brought together more than 200 investors and seven minerals and exploration companies. In the second half of 2026, NZX will host a Technology Investor Day. We are also continuing to strengthen relationships across Australia with the objective of supporting future dual listing activity and improving the Trans-Tasman connection for issuers and investors. Overall, companies continue to recognize the long-term benefits of listing. We are seeing more early-stage interest, and several IPO candidates are waiting for less volatile market conditions before proceeding. That said, listings are an ecosystem outcome, not an NZX one alone. Our role is to shorten and de-risk the path once a company engages. Moving to slide 10 on capital markets liquidity.

Speaker #2: Which brought together more than 200 investors and 7 minerals and exploration companies. In the second half of 2026, NZX will host a technology investor day.

Speaker #2: We are also continuing to strengthen relationships across Australia, with the objective of supporting future dual-listing activity and improving the Trans-Tasman connection for issuers and investors.

Speaker #2: Overall, companies continue to recognize the long-term benefits of listing. We are seeing more early-stage interest, and several IPO candidates are waiting for less volatile market conditions before proceeding.

Speaker #2: That said, listings are an ecosystem outcome—not an NZX one alone. We do not control the outcome. Our role is to shorten and de-risk the path once a company engages.

Speaker #2: Moving to slide 10 and capital markets liquidity. Trading activity was solid, with cash market value traded at $21.2 billion, down marginally on the previous year due to lower volumes of index rebalancing.

Graham Law: Trading activity was solid, with cash market value traded at NZD 21.2 billion, down marginally on the previous year due to lower volumes of index rebalancing. NZX also completed important participant onboarding work to support the development of both the derivatives market and the cash market. There have been three new participants onboarded in the period, and one participant extended their status. This increase in the number of participants should result in deepening of cash market liquidity. We continue to develop market settings and invest in market infrastructure. For example, we have been considering ways in which the market arrangements in New Zealand could be enhanced to create efficiencies for participants and investors. As previously stated, we are interested in exploring the benefits of a single set of clearing, settlement, and depository infrastructure in New Zealand.

Speaker #2: NZX also completed important participant onboarding work to support the development of both the derivatives market and the cash market. There have been three new participants onboarded in the period, and one participant extended their status.

Speaker #2: This increase in the number of participants should result in a deepening of cash market liquidity. We continue to develop market settings and invest in market infrastructure.

Speaker #2: For example, we have been considering ways in which to market arrangements in New Zealand—how the market arrangements in New Zealand could be enhanced to create efficiencies for participants and investors.

Speaker #2: As previously stated, we are interested in exploring the benefits of a single set of pairing settlement and depositary infrastructure in New Zealand. We consider this proposition to be highly beneficial, enabling more efficient and cost-effective outcomes for the New Zealand market.

Graham Law: We consider this proposition to be highly beneficial, enabling more efficient and cost-effective outcomes for the New Zealand market. We look forward to progressing our discussions with the RBNZ. Moving to slide 11, the successful delivery of the S&P/NZX 20 Index Futures project in April was a key milestone for NZX and for the broader market. The launch was underpinned by industry demand and supported by a cornerstone group of institutional end users. NZX expects participation to broaden over time as additional brokers and trading platforms connect, opening access to a wider range of market participants, including retail investors, and providing a foundation for future development of New Zealand's derivatives market. Over time, a well-functioning liquid equity derivatives market will support greater cash market trading and post-trade revenues, improve price discovery, retaining liquidity onshore, and creating scalable platform for future equity options and interest rate derivative products.

Speaker #2: We look forward to progressing our discussions with the RBNZ. Moving to slide 11, the successful delivery of the S&P/NZX 20 Futures Project in April was a key milestone for NZX and for the broader market.

Speaker #2: The launch was underpinned by industry demand and supported by a cornerstone group of institutional end users. NZX expects participation to broaden over time as additional brokers and trading platforms connect, opening access to a wider range of market participants, including retail investors, and providing a foundation for future development of NZX and New Zealand's derivatives market.

Speaker #2: Over time, a well-functioning liquid equity derivatives market will support greater cash market trading and post-trade revenues, improve price discovery, retain liquidity onshore, and create a scalable platform for future equity options and interest rate derivative products.

Speaker #2: The long-term potential for NZX's equity derivative products could be estimated by the relative size of the index futures market to the equity market, i.e., a multiplier or factor.

Graham Law: The long-term potential for NZX's equity derivative products could be estimated by the relative size of the index futures market to the equity market, i.e., a multiplier factor. The multiple for a few exchanges is shown on the graph on the right-hand side. For NZX, a multiplier of 0.25 in volumes is expected to equate to approximately NZD 2.5 million of revenue. On slide 12, we outline how dairy derivatives are an important part of NZX's growth strategy. Dairy derivative lots traded were 364,000, down 5.7% compared to the comparative period in 2025. Last year, we experienced two large structured auction trades of 40,000 lots. Excluding these, growth was at 5.3%. The long-term potential for the dairy derivatives product can be estimated by comparing the derivative lots or paper to the physical market ratio.

Speaker #2: The multiple for a few exchanges is shown on the graph on the right-hand side. For NZX, a multiplier of 0.25 in volumes is expected to equate to approximately $2.5 million of revenue.

Speaker #2: On slide 12, we outline how dairy derivatives are an important part of NZX's growth strategy. Dairy derivative lots traded were 364,000, down 5.7% compared to the comparable period in 2025.

Speaker #2: Last year, we experienced two large structured option trades of 40,000 lots. Excluding these, growth was at 5.3%. The long-term potential for the dairy derivatives product can be estimated by comparing the derivative lots—or paper—to the physical market ratio.

Speaker #2: As an example of how large the potential market could be, the average of iron ore weight, rubber, and paper to physical market ratios is approximately four times.

Graham Law: As an example of how large the potential market could be, the average of iron ore, wheat, rubber, paper to physical market ratios is approximately four times. For NZX, this ratio was 0.46 in 2025, illustrating there is potential for further substantial growth as the dairy derivative market matures. Again, an estimate of this ratio at 0.25 equates to approximately NZD 2.5 million of revenue. Global Dairy Trade, or GDT, continues to invest in strategic initiatives while remaining profitable at an underlying basis due to its paper pay arrangements with Fonterra. In the H1 of the year, the loss reflects the seasonal nature of the business, with the June quarter typically being the weakest for milk volumes and is not indicative of the underlying performance.

Speaker #2: For NZX, this ratio was 0.46 in 2025, illustrating there is potential for further substantial growth as the dairy derivative market matures. And again, an estimate of this ratio at 0.25 equates to approximately $2.5 million of revenue.

Speaker #2: Global Dairy Trade, or GDT, continues to invest in strategic initiatives while remaining profitable on an underlying basis, due to its taker-pay arrangements with OTER.

Speaker #2: In the first half of the year, the loss reflects the seasonal nature of the business, with the June quarter typically being the weakest for milk volumes, and is not indicative of the underlying performance.

Graham Law: Higher costs during the period were driven by the stabilization of the insourced auction platform, which will be modernized over the coming couple of years, and investment in GDT's planned expansion into Singapore, and listing sales capabilities in Asia, Europe, and the US markets. This expansion is intended to diversify GDT's participation base by building trust and neutrality, thus reducing their reliance on Fonterra over time. GDT's investments for growth are expected to mature in the coming years. Slide 13 notes how NZX continued to engage closely with government and other stakeholders on reforms designed to strengthen New Zealand capital markets. NZX has consulted on both the introduction of dual-class share structures and a tiered compliance framework for SME issuers.

Speaker #2: Higher costs during the period were driven by the stabilization of the insourced auction platform, which will be modernized over the coming couple of years, and investment in GDT's planned expansion into Singapore and listing sales capabilities in Asia, Europe, and the US markets.

Speaker #2: This expansion is intended to diversify GDT's participation base by building trust and neutrality, thus reducing their reliance on Frontera over time. GDT's investments for growth are expected to mature in the coming years.

Speaker #2: Slide 13 notes how NZX continued to engage closely with government and other stakeholders on reforms designed to strengthen New Zealand capital markets. NZX has consulted on both the introduction of dual-class share structures and a tiered compliance framework for SME issuers.

Speaker #2: These proposals are intended to support a broader range of listing options, reduce unnecessary compliance costs for smaller issuers, and improve the attractiveness of New Zealand's capital markets.

Graham Law: These proposals are intended to support a broader range of listing options, reduce unnecessary compliance costs for smaller issuers, and improve the attractiveness of New Zealand capital markets while maintaining appropriate investor protections and market integrity. Alongside this, we continue to support the Government Capital Market Reform Phase Two. As well as the proposed KiwiSaver reforms, which will lead to an increase of the pool of long-term domestic capital available for investment. Alongside this, NZX is continuing to make the case for tax measures that reduce the cost of access to public markets, such as tax relief for IPO-related costs, as well as alignment between direct investors of shares and direct securities, and PIE investors. NZX supports high-quality disclosure and strong governance. However, regulation that is too complex, uncertain, or costly can discourage the very activity New Zealand needs.

Speaker #2: While maintaining appropriate investor protections and market integrity. Alongside this, we can continue to support the government and government capital market reform schemes too, as well as the proposed KiwiSaver reforms, which will lead to an increase in the pool of long-term domestic capital available for investment.

Speaker #2: Alongside this, NZX is continuing to make the case for tax measures that reduce the cost of access to public markets, such as tax relief for IPO-related costs, as well as alignment between direct investors of shares and direct securities, and PIE investors.

Speaker #2: NZX supports high-quality disclosure and strong governance. However, regulation that is too complex, uncertain, or costly can discourage the very activity New Zealand needs: more companies accessing public markets, and more investors participating in them.

Graham Law: More companies accessing public markets and more investors participating in them. Moving to the funds management business, Smart, on slide 14. Smart remains a key part of NZX's growth strategy and remains a significant long-term opportunity. KiwiSaver settings, increasing investor participation, contribution growth, and demand for accessible, cost-effective investment products all provide structural support for the business. At 30 June, Smart's total FUM was NZD 18 billion, up 28.5% year on year. Net cash flows for the 6 months exceeded expectations at NZD 1.2 billion, which included wholesale FUM from Lifetime Asset Management, which was part of the SuperLife UK pension scheme disposal in 2025. in March, we announced the investment management externalization of the active QuayStreet funds. Under the new structure, QuayStreet Asset Management manages the brand and holds responsibility for investment management, marketing, and distribution.

Speaker #2: Moving to the funds management business, Smart on slide 14. Smart remains a key part of NZX's growth strategy and continues to represent a significant long-term opportunity.

Speaker #2: KiwiSaver settings, increasing investor participation, contribution growth, and demand for accessible, cost-effective investment products all provide structural support for the business. At 30 June, Smart's total funds under management was $18 billion, up 28.5% year-on-year.

Speaker #2: Net cash flows for the six months exceeded expectations at $1.2 billion, which included wholesale funds from Lifetime Asset Management, as part of the supervised UK pension scheme disposal in 2025.

Speaker #2: In March, we announced the investment management externalization of the active Keystrate funds. Under the new structure, Keystrate Asset Management manages the brand and holds responsibility for investment management, marketing, and distribution.

Speaker #2: Smart remains the product owner of the Keystrate funds and KiwiSaver scheme, and will also maintain and operate the infrastructure that supports the schemes. The increased distribution capabilities have resulted in Keystrate Asset Management Fund increasing to $2.8 billion, up 34.4% year-on-year.

Graham Law: Smart remains the product owner of the QuayStreet funds and KiwiSaver scheme and will also maintain and operate the infrastructure that supports the schemes. The increased distribution capabilities have resulted in QuayStreet Asset Management FUM increasing to NZD 2.8 billion, up 34.4% year on year. The SuperLife diversified KiwiSaver funds are managed by the Smart team, with the passive building blocks overlaid with active asset allocation. Investment performance has been strong, with nearly all funds in the top 2 quartiles on a peer comparison basis. NZX remains focused on maturing Smart operations, improving customer experience, simplifying the product set where appropriate, and building a business that can deliver long-term value for investors and shareholders.

Speaker #2: The supervised diversified KiwiSaver funds are managed by the Smart team, with the passive building blocks overlaid with active asset allocation. Investment performance has been strong, with nearly all funds in the top two quartiles on a peer comparison basis.

Speaker #2: NZX remains focused on maturing Smart operations and improving customer experience, simplifying the product set where appropriate, and building a business that can deliver long-term value for investors and shareholders.

Speaker #2: Looking ahead to the second half of 2026, following the migration of the KiwiSaver registry to the Wealth Technologies platform, Smart will be delivering a refresh of the supervised KiwiSaver under the Smart brand, along with an improved agile experience, with increased marketing to support future growth.

Graham Law: Looking ahead to H2 2026, following the migration of the KiwiSaver registry to the Wealth Technologies platform, Smart will be delivering a refresh of the SuperLife KiwiSaver under the Smart brand, along with an improved digital experience, with increased marketing to support future growth. The ambition being to grow our KiwiSaver share to 5%. Turning to Wealth Technologies on slide 15. The platform continued to increase its market share, building on the strong momentum of recent years. At 30 June, funds under administration reached NZD 21.1 billion, up 20.1% year on year, and the annual recurring revenue, or ARR, was the equivalent of NZD 13.7 million, up 15% year on year. For the avoidance of doubt, the annual recurring revenue metric indicates the annual equivalent revenue generated from the funds under administration at a specific date.

Speaker #2: The ambition is to grow our KiwiSaver share to 5%. Turning to Wealth Technologies on slide 15, the platform continued to increase its market share, building on the strong momentum of recent years.

Speaker #2: At 30 June, funds under administration reached $21.1 billion, up 20.1% year-on-year. And the annual recurring revenue, or ARR, was the equivalent of $13.7 million, up 15% year-on-year.

Speaker #2: For the avoidance of doubt, the annual recurring revenue metric indicates the annual equivalent revenue generated from the funds under administration at a specific date.

Speaker #2: The contracted future migrations include, amongst other clients, great investment partners extending their technology services, and the Smart KiwiSaver migration. On full migration, the annual recurring revenue equivalent would be $18.7 million, up 34.8% year-on-year.

Graham Law: The contracted future migrations include, amongst other clients, Craigs Investment Partners extending their technology services and the Smart KiwiSaver migration. On full migration, the annual recurring revenue equivalent would be NZD 18.7 million, up 34.8% year on year. Strategically, there are three legs to the Wealth Technologies future growth. First, the progress continues in the core adviser addressable market. The future client pipeline remains strong, reflecting the confidence in the platform service quality, capability, and reliability. Secondly, the Smart KiwiSaver migration will open up access to a new estimated addressable market at approximately NZD 275 billion for fund registry services. Though, like the adviser addressable market, not fully accessible. Finally, as Wealth Technology scales, this will allow us to pivot more to the equivalent Australian platforms model.

Speaker #2: Strategically, there are three legs to Wealth Technologies' future growth. First, progress continues in the core advisor aggressor market. The future client pipeline remains strong, reflecting confidence in the platform's service quality, capability, and reliability.

Speaker #2: Secondly, the Smart KiwiSaver migration will open up access to a new estimated addressable market at approximately $275 billion for fund registry services. Though, like the advisor addressable market, it is not fully accessible.

Speaker #2: Finally, as Wealth Technologies scales, this will allow us to pivot more to the equivalent Australian platforms model. There is a real drive by New Zealand wealth advisors for their customers to have a single-viewing platform for all their customers' investment types and transactions.

Graham Law: There is a real drive by New Zealand wealth advisers for their customers to have a single view and platform for all their customers' investment types and transactions. This provides an opportunity for innovation. To leverage scale and provide our small and medium advisor groups with both transactional services as well as enhanced product offerings. Finally, I'd like to make two acknowledgments. First to Mark Peterson, for the significant contribution he made over 10 years to NZX, and the development and delivery of our strategy. Secondly, yesterday's announcement by the NZX board of Hishaam Mirza as NZX's next Chief Executive. Hishaam will join NZX on 14 September, and we look forward to working with him as we continue to execute our strategy. Importantly, today's result demonstrates the strength of NZX's diversified business model and the momentum we have built across markets, Capital Markets, Smart, and Wealth Technologies.

Speaker #2: This provides an opportunity for innovation, to leverage scale, and provide small and medium advisor groups with both transactional services as well as enhanced product offerings.

Speaker #2: Finally, I'd like to make two acknowledgments. First, to Mark Peterson for the significant contribution he made over 10 years to NZX, and the development and delivery of our strategy.

Speaker #2: And secondly, yesterday's announcement by the NZX Board of Hisham Marza as NZX's next Chief Executive. Hisham will join NZX on the 14th of September, and we look forward to working with him as we continue to execute our strategy.

Speaker #2: Importantly, today's results demonstrate the strength of NZX's diversified business model and the momentum we have built across markets, Capital Markets, Smart, and Wealth Technologies.

Speaker #2: We are well positioned for a seamless transition and remain focused on delivering to our customers, New Zealand’s capital markets, and our shareholders. I’ll now hand over to Amy to take you through the financials.

Graham Law: We are well-positioned for a seamless transition and remain focused on delivering to our customers, New Zealand's capital markets, and our shareholders. I'll now hand over to Amy to take you through the financials, after which we will be happy to answer questions.

Speaker #2: After which, we will be happy to answer questions.

Speaker #1: Okay, thank you, Graham. Before I start, I would just like to draw everyone's attention back to the disclaimer on slide 2, which contains important caveats relating to the information I'm about to cover.

Amy Trotman: Okay. Thank you, Graham. Before I start, I would just like to draw everyone's attention back to the disclaimer on slide 2, which contains important caveats relating to the information I am about to cover. Starting with the financial performance, the income statement for the 6-month period ended June 2026 is summarized on slide 17. We provide further explanation on the operating revenue, operating expenses, and non-operating expenses in slides 18 to 21. Additionally, we have detailed analysis of the operating results by segment in appendix 1 to the presentation. Before I provide any additional detail on this slide, I did just want to note the presentational change that has been made during the period, which has included a restatement of the 2025 numbers. The change is to present certain costs associated with managing and distributing the Smartshares funds within operating expenses.

Speaker #1: So, starting with the financial performance—the income statement for the six-month period ended June 26 is summarized on slide 17, and we provide further explanation on the operating revenue, operating expenses, and non-operating expenses in slides 18 to 21.

Speaker #1: Additionally, we have a detailed analysis of the operating results by segment in Appendix 1 to the presentation. Before I provide any additional detail on these slides, I did just want to note the presentational change that has been made during this period, which has included a restatement of the 2025 numbers.

Speaker #1: The change is to present certain costs associated with managing and distributing the Smart funds within operating expenses. Previously, all fund-related costs were netted against funds management revenue.

Amy Trotman: Previously, all fund-related costs were measured against funds management revenue. The change increases revenue and increases expenses, but it has no change on operating earnings. Operating revenue increased year-on-year by NZD 9 million, and that is up 13.3% to NZD 76.6 million. NZX has diverse revenue sources, and these can be seen in note 5 to the interim financial statement. The waterfall on slide 18 highlights the drivers for the increased operating revenue. The largest increase is within Smartshares, where fund-based revenue has grown in line with the 28.5% year-on-year increase in funds under management. In Wealth Technologies, the increase reflects some lift in annual recurring revenue from new clients added over H2 2025 and during 2026.

Speaker #1: So the change increases revenue and increases expenses, but it has no change on operating earnings. Operating revenue increased year-on-year by $9 million, and that's up 13.3% to $76.6 million.

Speaker #1: Interdict has diverse revenue sources, and these can be seen in Note 5 to the interim financial statement. The waterfall on slide 18 highlights the drivers for the increased operating revenue.

Speaker #1: The largest increase is within Smart, with fund-based revenue growing in line with the 28.5% year-on-year increase in funds under management. In Wealth Technologies, the increase reflects the lift in annual recurring revenue from new clients added over the second half of 2025 and during 2026.

Speaker #1: And in the Markets business, growth is driven by the increased Information Services recurring revenue lines, as well as close to $1 million in one-off audit and backdated revenue, of which there was none in 2025.

Amy Trotman: In the Markets business, growth is driven by the increased information services recurring revenue line, as well as close to NZD 1 million in one-off audit and backdated revenue, of which there was none in 2025. Operating expenses, excluding project and restructuring costs, increased year-on-year by NZD 6.8 million to NZD 49.3 million. The waterfall on slide 19 highlights that the year-on-year increase was across all business units. Overall, this results in the operating earnings before project and restructure costs increasing NZD 2.2 million. That is up 8.8% to NZD 27.3 million. I will now break down the operating earnings before project and restructure costs by segment, and that is summarized on slide 20, with the additional detailed segmental analysis provided in appendix 1 to the presentation. Starting with the Markets business, where operating earnings before restructuring costs have increased by NZD 1.3 million.

Speaker #1: Operating expenses, excluding project and restructuring costs, increased year-on-year by $6.8 million to $49.3 million. The waterfall on slide 19 highlights that the year-on-year increase was across all business units.

Speaker #1: Overall, this results in the operating earnings before project and restructure costs increasing by $2.2 million; that's up 8.8% to $27.3 million. I'll now break down the operating earnings before project and restructure costs by segment, and that's summarized on slide 20, with the additional detailed segmental analysis provided in appendix 1 to the presentation.

Speaker #1: Starting with the Markets business, our operating earnings before restructuring costs have increased by $1.3 million. Markets business revenue increased by $1.9 million, up 6.4%. The main factors include— in Capital Markets, origination revenue has increased due to higher annual listing fees after internal allocations to Interdico, reflecting growth in both Interdico’s equity and debt market capitalization over the second half of 2024 and the first half of 2025.

Amy Trotman: Markets business revenue increased NZD 1.9 million, up 6.4%, and the main factors include, in Capital Markets, origination revenue has increased due to higher annual listing fees after internal allocations to NZ RegCo, which reflects the growth in both the NZX equity and debt market capitalization over H2 2024 and H1 2025. Remembering that it is the market capitalization on 31 May each year, which drives the annual listing fees for the year July to June. Initial and subsequent listing fees are now recognized evenly over 5 and 3-year periods, respectively. In H1-26, we had higher levels of primary listings for both equity, if we exclude the Fonterra listing in H1 2025, and retail debt, combined with growth in secondary issuance. Remembering that equity has a relatively higher fee rate than retail debt, than wholesale debt, and finally than funds.

Speaker #1: Remember that it is the market capitalization on 31 May each year which drives the annual listing fees for the year July to June. Initial and subsequent listing fees are now recognized evenly over five- and three-year periods respectively.

Speaker #1: In H1 ’26, we had higher levels of primary listings for both equity—if we exclude the Frontiero listing in the first half of ’25—and retail debt, combined with growth in secondary issuance.

Speaker #1: Remembering that equity has a relatively higher fee rate than retail debt, then wholesale debt, and finally than funds. Secondary markets revenue was slightly lower than the prior period, and that was driven by lower consulting and development revenues from the Electricity Authority, following near-record activity levels in 2025.

Amy Trotman: Secondary Markets revenue was slightly lower than the prior period, and that was driven by lower consulting and development revenues from the Electricity Authority following near record activity levels in 2025. We had reduced dairy derivatives revenue, which reflects the lower lots traded, compared with last year, with 2025 including several large speculative trades that have not yet repeated in 2026. Trading and clearing value were at lower levels, though this was partially offset by lower levels of uncharged value traded, i.e., where trade value exceeded the BCAC. The relaunch of the equity derivatives market during the period contributed modest new revenue, with further growth expected as market activity develops. For information services, revenue is up due to that close to NZD 1 million of audit or backdated license revenue that I noted earlier, and growth of recurring revenue lines of 7.4% on the H1 of last year.

Speaker #1: We had reduced dairy derivatives revenue, which reflects the lower lots traded compared to last year, with 2025 including several large speculative trades that have not yet repeated in 2026.

Speaker #1: Trading and clearing value was at lower levels, though this was partially offset by lower levels of uncharged value traded—i.e., where trades' value exceeded the fee cap.

Speaker #1: The relaunch of the equity derivatives market during the period contributed modest new revenue, with further growth expected as market activity develops. For information services, revenue is up due to that close to $1 million of audit or backdated license revenue that I noted earlier, and growth of recurring revenue lines of 7.4% on the first half of last year. That's due to increased license and professional terminal numbers, higher indices revenue, and some price increases.

Amy Trotman: That is due to increased license and professional terminal numbers, higher indices revenue, and some price increases. The market business expenses increased by NZD 0.6 million. Net personnel costs contributed about half of that growth, and that is due to the combination of additional investment in digital relationship management, and lower levels of work on capitalized projects. Information technology costs decreased NZD 0.2 million, which largely reflects the absence of one-off costs incurred in energy markets last year, as well as efficiencies realized through IT service optimization initiatives. These savings have more than offset the trading and clearing system inflationary increase, which lifts based on New Zealand and Indian CPI, and other inflationary increases across other infrastructure running costs.

Speaker #1: The Markets business expenses increased by $0.6 million. Net personnel costs contributed about half of that growth, and that's due to the combination of additional investment in issuer relationship management and lower levels of work on capitalized projects.

Speaker #1: Information technology costs decreased by $0.2 million, which largely reflects the absence of one-off costs included in the energy markets last year, as well as efficiencies realized through IT service optimization initiatives.

Speaker #1: These savings have more than offset the trading and clearing system inflationary increase, which lifted based on New Zealand and Indian CPI, and other inflationary increases across other infrastructure running costs.

Speaker #1: Marketing costs increased by $0.1 million, reflecting the work done to engage with the market to build the listing pipeline and support capital-raising activities, as well as liquidity provision schemes activated in 2025 for the dairy derivatives market.

Amy Trotman: Marketing costs increased NZD 0.1 million, reflecting the work done to engage with the market to build the listing pipeline and support capital raising activities, as well as liquidity provision schemes activated, in 2025 for dairy derivative market. Moving to the Smart business. The headline operating earnings, excluding project and restructuring costs, have increased on the H1 of 2025 by 11% to NZD 15.2 million. Before discussing these results, there are two important changes to note. Firstly, the presentational change I have already talked about. We now have certain costs associated with managing and distributing those funds. Previously had been netted against funds management revenue, now recognized gross within funds expenses. The 2025 numbers have been restated to present consistently. The change increases revenue and expenses, but it has no impact on operating earnings.

Speaker #1: Moving to the Smart business, the headline operating earnings, excluding project and restructuring costs, have increased in the first half of '25 by 11% to $15.2 million.

Speaker #1: Before discussing these results, there are two important changes to note. Firstly, the presentational change I've already talked about. We now have certain costs associated with managing and distributing those funds, which previously had been netted against funds management revenue, now recognized gross within funds expenses.

Speaker #1: The 2025 numbers have been restated to present consistently. The change increases revenue and expenses, but it has no impact on operating earnings. The second change in the period is the externalization of Key Street.

Amy Trotman: The second change in the period is the externalization of QuayStreet, which effectively outsources the investment management, distribution, and client relationship activities that were previously done in-house. As a result, personnel, technology, and research costs have reduced, and they are replaced with higher fund expenses, which now include the investment manager fees, which increase as fund increases, and relationship and distribution fees payable under the new partnership agreement. Turning to performance. Fund-based revenue continued to grow in line with the increased average funds, which as we show on slide 14, is a combination of positive net cash flows and positive market returns, so the monthly saving profile in the H1 of 2026 did have an impact. Fund expenses also increased in line with funds, with the step-up from the prior period reflecting the new external investment manager and distribution costs payable to QuayStreet under the new partnership agreement.

Speaker #1: This effectively outsources the investment management, distribution, and client relationship activities that were previously done in-house. As a result, personnel, technology, and research costs have reduced, and they've been replaced with higher fund expenses, which now include the investment manager fees—these increase as the fund increases—and relationship and distribution fees payable under the new partnership agreement.

Speaker #1: Turning to performance, fund-based revenue continued to grow in line with the increased average fund, which, as we show on slide 14, is a combination of positive net cash flows and positive market returns, though the monthly phasing profile in the first half of '26 did have an impact.

Speaker #1: Fund expenses also increased in line with funds, with the step-up from the prior period reflecting the new external investment manager and distribution costs payable to Key Street under the new partnership agreement.

Speaker #1: Average BIPS net of fund expenses is slightly down, and that reflects those increased fund costs associated with the Key Street externalization, as well as the distribution channels that are driving cash flows rather than fee completion.

Amy Trotman: Average bps net of fund expenses is slightly down, and that reflects those increased fund costs associated with the QuayStreet externalization, as well as the distribution channels that are driving cash flows rather than fee compression. Looking ahead, we do expect some improvement in H2 as one-off transition and establishment arrangements relating to QuayStreet fall away. Excluding fund expenses, the cost base has increased only 1.1%, and that largely reflects the removal of those in-house costs for QuayStreet, which have been replaced with those higher fund costs. Breaking that down further, gross personnel costs have increased 3.9%, which reflects additional roles added over the H2 of last year and this year, largely to enhance distribution capability, improve customer experience, and client growth. Offsetting that is a reduction in FTE as a result of the QuayStreet externalization.

Speaker #1: Looking ahead, we do expect some improvement in H2 as one-off transition and establishment arrangements relating to Key Street fall away. Excluding fund expenses, the cost base has increased only 1.1%, and that largely reflects the removal of those in-house costs for Key Street, which have been replaced with the higher fund costs.

Speaker #1: Breaking net down further, gross personnel costs have increased 3.9%, which reflects additional roles added over the second half of last year and this year, largely to enhance distribution capability, improve customer experience, and support client growth.

Speaker #1: Offsetting that is a reduction in FTA as a result of the Key Street externalization. Additional resources that are focused on activities to mature Smart Operations are recognized in the project cost growth.

Amy Trotman: Additional resources that are focused on activities to mature Smart operations are recognized in the project cost growth. The reduction in information technology costs reflects the removal of costs now outsourced to QuayStreet. Excluding this impact, IT costs are up due to inflation and higher usage-based costs. Marketing costs have increased in the H1 2026 due to increased targeted campaign activity and will increase further in the H2 2026 in connection with the planned KiwiSaver rebrand. Moving to the Wealth Technology business, where operating earnings have increased 30% to NZD 3.2 million. Operating revenue increased 26.1%, and that is driven by Wealthtech's FUA-based fees, which have increased in line with the average FUA, which we show on slide 15.

Speaker #1: The reduction in information technology costs reflects the removal of costs now outsourced to Key Street. Excluding this impact, IT costs are up due to inflation and higher usage-based costs.

Speaker #1: Marketing costs have increased in the first half of '26 due to increased targeted campaign activity, and will increase further in the second half of '26 in connection with the planned Q2.

Speaker #1: Rebrand. Now, moving to the Wealth Technologies business, our operating earnings have increased 30% to $3.2 million. Operating revenue increased 26.1%, and that's driven by WealthTech’s SOTER-based fees, which have increased in line with the average SOTER, as we show on slide 15.

Speaker #1: And that increase is a combination of new clients being migrated onto the platform over the second half of last year and the first half of this year.

Amy Trotman: That increase is a combination of new clients being migrated onto the platform over the H2 of last year and the H1 of this year, positive market returns, and positive net cash flows. Similar to Smart, the monthly saving profile in the H1 2026 did have an impact. Development fees or deferred income reflects the levels of customization specific to client requirements. Some of that is paid in advance and for accounting purposes is recognized over the life of the client contract. This has increased in the H1 2026 due to the recognition of deferred revenue relating to platform development completed for Smart in the H2 of last year. That is eliminated by the intersegment elimination at a group level. The operating cost base for Wealthtech increased 23%.

Speaker #1: Positive market returns and positive net cash flows. Though similar to Smart, the monthly phasing profile in the first half of '26 did have an impact.

Speaker #1: Development fees, or deferred income, reflect the levels of customization specific to client requirements. Some of that is paid in advance, and for accounting purposes, is recognized over the life of the client contract. This has increased in the first half of '26 due to the recognition of deferred revenue relating to platform development completed for Smart in the second half of last year.

Speaker #1: And that is eliminated by the end-of-segment elimination at a group level. The operating cost base for Wealth Tip increased 23%. The main factors being gross personnel costs, which were higher, as we have previously indicated, reflecting the increased headcount to accelerate development and migration velocity for the large SaaS client, who we will onboard in '27.

Amy Trotman: The main factors being gross personnel costs, which were higher as we had previously indicated, which reflects the increased headcount to accelerate development and migration velocity for the large SAF client who we will onboard in 2027. That development is largely client-funded, with the recognition of that contribution deferred until the project goes live next year. Capitalized labor and overhead reflects the continued development in client migration activities that were at proportionately lower levels this half. We expect that as the business grows, the proportion of gross salaries capitalized does decrease to reflect more operational activity. Other costs are driven by non-recoverable GST and platform transaction costs, which both increase as the business grows. As we indicated on slide 15, the remaining migration of Wealthtech currently contracted clients will add further to the annual recurring revenue.

Speaker #1: That development is largely client-funded, with the recognition of that contribution deferred until the project goes live next year. Capitalized labor and overhead reflects the continued development and client migration activities, but were at proportionately lower levels this half.

Speaker #1: We expect that as the business grows, the proportion of gross salaries capitalized will decrease to reflect more operational activity. Other costs are driven by non-recoverable GST and platform transaction costs, both of which increase as the business grows.

Speaker #1: As we indicated on slide 15, the remaining migration of wealth tips for currently contracted clients will add further to the annual recurring revenue. The timing of that is dependent on client strategic prioritization and migration resource commitments, as well as the client's current platform provider supplying data in a timely manner.

Amy Trotman: The timing of that is dependent on client strategic prioritization and migration resource commitments, as well as the client's current platform provider supplying data in a timely manner. Additionally, our prospects list remains very strong, with a number of ongoing discussions near completion. Overall, the timing of migrations for currently contracted clients and future potential clients will drive the CapEx profile, and the profile of the amortization bubble. Moving now to corporate. Operating expenses increased in that segment by 11.6%. For personnel costs, that growth reflects the additional resources added over the H2 of last year to cover strategic HR and corporate roles that are supporting the Smart and Wealth Technologies growth. The increase in IT costs reflects increased cybersecurity, investment in AI productivity tools, and support for the growth businesses that were added largely during the H2 of last year, as well as normal inflationary increases.

Speaker #1: Additionally, our prospects list remains very strong, with a number of ongoing discussions near completion. Overall, the timing of migrations for currently contracted clients and future potential clients will drive the CapEx profile, and the profile of the amortization bubble.

Speaker #1: Moving now to corporate, operating expenses increased in that segment by 11.6%. For personnel costs, that growth reflects the additional resources added over the second half of last year to cover strategic HR and corporate roles that are supporting the Smart and Wealth technology growth.

Speaker #1: The increase in IT costs reflects increased cybersecurity, investment in AI productivity tools, and support for the growth businesses that were added largely during the second half of last year.

Speaker #1: As well as normal inflationary increases. We did see a reduction in the second half of last year as a result of IT service optimization initiatives and the absence of one-off implementation costs in the second half.

Amy Trotman: We did see a reduction on the H2 of last year as a result of IT service optimization initiatives and the adherence of one-off implementation costs that were incurred in the H2 of last year. Professional fees increased, with high levels of legal advice and other consulting relating to strategic initiatives, with 2025 also benefiting from one-off non-recoverable GST savings. Finally, in NZ RegCo, operating earnings after internal revenue and expense allocations were a loss of NZD 60,000, which was an improvement on the H1 of last year. That was driven by one-off accreditation fees associated with onboarding new participants and advisors, as well as regulatory fee-generating activities have been higher than the H1 of 2025. Moving to non-operating expenses on slide 21.

Speaker #1: These were incurred in the second half of last year. Professional fees increased, with high levels of legal advice and other consulting relating to strategic initiatives.

Speaker #1: With 2025 also benefiting from one-off, non-recoverable GST savings. Finally, in the RICO, operating earnings after internal revenue and expense allocations were a loss of $60,000, which was an improvement on the first half of last year.

Speaker #1: And that was driven by one-off accreditation fees associated with onboarding new participants and advisors, as well as regulatory fee-generating activity that was higher than the first half of '25.

Speaker #1: Right. Moving to non-operating expenses on slide 21. The project and restructure costs relate to incremental, one-off external costs, net of capitalized internal costs, and primarily relate to the maturing of the Smart systems and operations.

Amy Trotman: The project and restructure costs relate to incremental one-off external costs, net of capitalized internal costs, and primarily relate to the maturing of the Smart systems and operations, which has been ongoing for several years and will continue into 2027. Net finance costs reflect lower average interest rates with the net impact of interest income on cash and regulatory risk capital being negatively impacted, and interest expenses on the acquisition facility being positively impacted. Interest costs were further reduced following the repayment of NZD 7.5 million of acquisition debt in the Q1 of 2026. Depreciation and amortization is higher, in line with our expectations, as we outlined in previous investor presentations. This mainly reflects Wealth Technologies increased amortization relating to new client migrations in both the H2 of last year and 2026. We continue to expect further increases as migrations continue and new clients join the Wealth Technologies platform.

Speaker #1: This has been ongoing for several years and will continue into 2027. Net finance costs reflect lower average interest rates, with the net impact of interest income on cash and regulatory risk capital being negatively impacted.

Speaker #1: And interest expenses on the acquisition facility were positively impacted. Interest costs were further reduced following the repayment of $7.5 million of acquisition debt in the first quarter of '26.

Speaker #1: Depreciation and amortization is higher in line with our expectations, as we outlined in previous investor presentations. This mainly reflects Wealth's increased amortization relating to new client migrations in both the second half of last year and '26.

Speaker #1: And we expect—and continue to expect—further increases as migrations continue and new clients join the Wealth Tip platform. As we have detailed in prior year investor presentations, the amortization profile does lag the CapEx profile by a few years, and we refer to that as the amortization bubble.

Amy Trotman: As we have detailed in prior year investor presentations, the amortization profile does lag the CapEx profile by a few years, and we refer to that as the amortization bubble. The share of profit or loss of associates relates to our investment in GDT. As Graham's already noted, the loss in 2026 largely reflects the seasonality of the GDT business revenue stream, and additional investment into auction platform stabilization, sales capability, and expansion into Singapore. GDT does remain profitable on an underlying basis, and we expect their investments for growth to mature in the coming years. The increase in tax expense reflects the increased profitability. We have a slightly higher effective tax rate than the statutory rate, and that's due to a combination of non-deductible items and accounting versus taxation valuation differences. Overall, this has resulted in net profit after tax being NZD 9.8 million.

Speaker #1: The share of profit or loss of associates relates to our investment in GDT. As Graham's already noted, the loss in '26 largely reflects the seasonality of the GDT business revenue streams, and additional investment into auction platform stabilization, sales capability, and extension into Singapore.

Speaker #1: GDT does remain profitable on an underlying basis, and we expect their investments for growth to mature in the coming years. The increase in tax expense reflects the increased profitability.

Speaker #1: We have a slightly higher effective tax rate than the statutory rate, and that's due to a combination of non-deductible items and accounting versus taxation valuation differences.

Speaker #1: So overall, this has resulted in net profit after tax being $9.8 million. That's up 18% on June last year. The headline operating margin has reduced to 35.6% from 37%, with the reduction relating to the Key Street externalization, which, as we have already noted, we do expect to see improvement in H2 as transitional arrangements drop away.

Amy Trotman: That's up 18% on June last year. The headline operating margin has reduced to 35.6% from 37%, with the reduction relating to the QuayStreet externalization, which as we have already noted, we do expect to see improvement in H2 as transitional arrangements drop away, and the additional investment to support Smartshares KiwiSaver rebrand and future marketing push. As I noted earlier, there is further detailed analysis of the operating results by business unit in appendix 1. If we move to slide 23, this summarizes the balance sheet. The key points to note here are firstly the cash and close balances, which are not available for general use. They include the Clearing House, NZD 20 million of risk capital and approximately NZD 2.9 million of working capital requirements under the Financial Market Infrastructures Act.

Speaker #1: And the additional investment to support Smart's key behavior rebrand and future marketing push. As I noted earlier, there is further detailed analysis of the operating results by business unit in Appendix One.

Speaker #1: If we move to Slide 23, this summarizes the balance sheet. The key points to note here are, firstly, the cash includes balances which are not available for general use.

Speaker #1: They include the clearinghouse's $20 million of risk capital and approximately $2.9 million of working capital requirements under the FMI Act. The funds management business has a similar, smaller amount of working capital requirements under FMI-managed investment.

Amy Trotman: The funds management business has a similar, smaller amount of working capital requirements under its FMA managed investment service license, and the Asia Region Funds Passport. The second point to note is the funds held on behalf of third parties, which is shown as an asset and a liability. They offset, and hence the assets are not available for general use. They relate to issuer bond deposits, participants' collateral deposits and depositor funds. The third point is the interest-bearing liabilities, which includes the sub-notes. The next election date for that is June 2028, and the acquisition loan facility, which has NZD 15 million drawn down and is now presented as a current liability given those facilities expire in February 2027, with negotiations to extend those facilities already underway. Moving to slide 24.

Speaker #1: Service license and the Asian Regional Funds Passport. The second point to note is the funds held on behalf of third parties, which are shown as both an asset and a liability.

Speaker #1: They offset, and hence the assets are not available for general use. They relate to actual bond deposits, participants, collateral deposits, and deposited funds. The third point is the interest-bearing liabilities, which include the sub-note. The next selection date for that is June 2028, and the acquisition loan facility, which has $15 million drawn down and is now presented as a current liability, given notes facilities expire in February 2027, with negotiations to extend those facilities already underway.

Speaker #1: Moving to slide 24. Slides 24 and 25 summarize the capital expenditure in full graphs, on the same scale to show relativity. For trading, clearing, and energy systems, the CapEx level depends on the specific system's lifecycle.

Amy Trotman: 24 and 25 summarize the CapEx in four graphs, all with the same scale to show relativity. For trading, clearing, and energy systems, the CapEx level depends on the specific system's life cycle. At present, there are no large upgrade projects underway, and we have already enhanced our trading system for the S&P/NZX 20 Index Futures and automation of the depository system. During 2026, we renewed our agreement for the current trading system. Looking out to the longer-term horizon, the trading system may come to end of life and require upgrading at that point. For property, plant, and equipment, 2026 CapEx relates to firewall upgrades, normal life cycle replacements, IT equipment and software, and the fit-out of extended space for the Wealthtech business. No major PPE projects are expected in the near term.

Speaker #1: At present, there are no large upgrade projects underway, and we have already enhanced our trading system for the S&P and the next 20 index futures, as well as the automation of the depository system.

Speaker #1: During 2026, we renewed our agreement for the current trading system. So, looking out to the longer term horizon, the trading system may come into play and require upgrading at that point.

Speaker #1: For property, plant, and equipment, $26 million CapEx relates to firewall upgrades, normal lifecycle replacements, IT equipment and software, and the fit-out of extended space for the Wealth Tip business.

Speaker #1: No major PPE projects are expected in the near term. For the growth businesses on the next slide, WealthTip is our largest area for CapEx, and the business continues to migrate new clients and maintain its product offering.

Amy Trotman: For the growth businesses on the next slide, Wealthtech is our largest area for CapEx, and the business continues to migrate new clients and maintain its product offering, with the elevated levels in the H1 2026 reflecting development and migration for that large SaaS client. We expect this level of CapEx to continue for a few years as the contracted new clients and further prospects are migrated to the platform. As we have noted already, that SaaS client is contributing to the migration costs, with those contributions deferred until the migration is completed and then recognized in development revenue over the applicable contract period. Smartshares continues to enhance its systems, with the H1 2026 spend relating to new data and digital capabilities, as well as design and development of the Smartshares app, which we expect to launch in Q4.

Speaker #1: With the elevated levels in the first half of 2026, reflecting development and migration for that large SaaS client, we expect this level of CapEx to continue for a few years, as the contracted new clients and further prospects are migrated to the platform.

Speaker #1: As we have noted already, that SaaS client is contributing to the migration costs, with those contributions deferred until the migration is completed and then recognized in development revenue over the applicable contract period.

Speaker #1: Smart continues to enhance its systems, with the first half of 2026 relating to new data and digital capabilities, as well as the design and development of the Smart Act, which we expect to launch in Q4.

Speaker #1: We expect second-half CapEx levels to remain high, due to further data system enhancements and the ongoing development of the Smart Act. And finally, cash flows.

Amy Trotman: We expect the H2 CapEx levels to remain high due to further data system enhancements and the ongoing development of that Smartshares app. Finally, cash flows. Slide 26 summarizes our cash flows for the year. H1 cash flow reflects our cash flow seasonality, specifically the annual listing and participant fee collection profile being in Q3 each year. Operating activity cash flow represents our net profit after tax, adjusted for non-cash items. These have increased as expected, in line with the increased operating earnings. Payments for PPE and intangible assets reflect the capital expenditure that I have just noted on the previous slide, with the increase largely relating to migration activity for Wealthtech and development for Smartshares. Other finance activities relate to lease payments.

Speaker #1: So, slide 26 summarizes our cash flows for the year. First-half cash flow reflects our cash flow seasonality, specifically the annual lifting and participant fee collection profile being in Q3 each year.

Speaker #1: Operating activity cash flow represents our net profit after tax, adjusted for non-cash items. These have increased as expected, in line with the increased operating earnings.

Speaker #1: Payments for PPE and intangible assets reflect the capital expenditure that I've just noted on the previous slide, with the increase largely relating to migration activity for Wealth Tip and development for Smart.

Speaker #1: Other finance activities relate to lease payments. Free cash flows are $1.4 million, which is up $2.7 million from the first half of last year, in line with our previously indicated expectations for cash flow growth.

Amy Trotman: Free cash flows are NZD 1.4 million, which is up NZD 2.7 million from the H1 of last year, in line with our previously indicated expectations for cash flow growth. The free cash flow has been used for payments of dividends, and we have also reduced our acquisition debt by NZD 7.5 million. As we noted in previous investor presentations, in future years after Wealthtech completes its migration of new clients and CapEx settles at a normal level, we expect cash flows to rise faster than NPAT increases due to the Wealthtech amortization bubble. Although noting that the exact timing of that amortization bubble impact is dependent on future new client migrations, and specifically, if further new clients are won, then that amortization bubble is deferred until those client migrations are completed. Slide 28, interim dividend. Our fully imputed interim dividend is 3.2 cents per share.

Speaker #1: The free cash flow has been used for payments of dividends, and we have also reduced our acquisition debt by $7.5 million. As we noted in previous investor presentations, in future years—after Wealth Tip completes its migration of new clients and CapEx settles at a normal level—we expect cash flows to rise faster than impact increases due to the Wealth Tip amortization bubble.

Speaker #1: Although noting that the exact timing of that amortization bubble impact is dependent on future new client migrations—and specifically, if further new clients are won, then that amortization bubble is deferred until those client migrations are completed.

Speaker #1: Slide 28, interim dividend. So, our fully imputed interim dividend is 3.2 cents per share. That's a 0.2 cent per share increase on the first half of last year.

Amy Trotman: That is a 0.2 cents per share increase on the H1 of last year. That will be paid on 30 September to all shareholders at the record date of 16 September. That leads us to our 2026 earnings guidance. NZX is maintaining our full-year 2026 operating earnings in the range of NZD 53 to 58.5 million. The half year financial results indicate that NZX is tracking towards the middle of that 2026 full-year guidance range, and progress towards achievement can be tracked within the shareholder metrics that are published monthly. As always, we note that earnings guidance is, of course, subject to the usual market caveats that are listed on the slide. That concludes our presentation, and we will now open it up for questions.

Speaker #1: That will be paid on the 30th of September to all shareholders of record as of the 16th of September. And that leads us to our 2026 earnings guidance.

Speaker #1: So NZX is maintaining our full-year 2026 operating earnings guidance in the range of $53 to $58.5 million. The half-year financial results indicate that NZX is tracking towards the middle of that 2026 full-year guidance range.

Speaker #1: Progress towards achievement can be tracked within the shareholder metrics that are published monthly. And, as always, we note that earnings guidance is, of course, subject to the usual market caveats that are listed on the slide.

Speaker #1: That concludes our presentation, and we'll now open it up for questions. I have a couple of questions. Dave Storms, I'm going to ask you to unmute, please.

Graham Law: I have a couple of questions. Dave Storms, I am going to ask you to unmute, please.

Simon Beattie: I have a couple of questions. Dave Storms, I am going to ask you to unmute, please.

Speaker #3: Hello. Good morning. Can you hear me?

Dave Storms: Hello. Good morning. Can you hear me?

[Analyst]: Hello. Good morning. Can you hear me?

Speaker #2: Yes, Dave.

Speaker #3: Perfect. I appreciate you taking my questions. I just wanted to maybe start with the future startup phase. I know you mentioned the amount you can win there.

Graham Law: Yes, Dave.

Dave Storms: Perfect. Appreciate you taking my questions. Just maybe wanted to start with the future startup phase. I know you mentioned the amount you can win there. Just would love to hear any more discussion about what it will take to get to a full gallop, and maybe anything more concrete there.

[Analyst]: Perfect. Appreciate you taking my questions. Just maybe wanted to start with the future startup phase. I know you mentioned the amount you can win there. Just would love to hear any more discussion about what it will take to get to a full gallop, and maybe anything more concrete there.

Speaker #3: I would just love to hear any more discussion about what it really takes to get to a full gallop, and maybe anything more concrete on that.

Speaker #2: So that's the equity derivatives, Dave, you're talking about?

Graham Law: So that is the equity derivatives, Dave, you are talking about?

Speaker #3: Yes. Yes.

Speaker #2: Yeah, that's slide—same as I-11. Yeah, you know, we launched it late April. The cornerstone group have been progressively coming on board through to July.

Dave Storms: Yes.

[Analyst]: Yes.

Graham Law: Yeah. That is slide, sounds like 11. We launched it late April. The cornerstone group have been progressively coming on board through to July. When we look at the cutoff here of 30 June, we do not have all participants on board. We are bringing on international clearers and market makers, so we feel that we are still in the startup phase, even in the Q3. What we have tried to do on the right-hand side of the slide here is show what a mature market looks like by comparing the size of the equity derivative market to the cash market of a couple of countries. We have data for a lot of countries, but we selected just ASX to show a large entity. Other large entities range from 1.7, 1.3, that type of range, so 1.5 seems like the middle.

Speaker #2: When we look at the cutoff here of June 30, we don't have all participants on board. We are bringing on international clearers and market makers.

Speaker #2: So, we feel that, you know, we're still in the startup phase, even in the third quarter. What we've tried to do, on the right-hand side of the slide here, is show what a mature market looks like by comparing the size of the equity derivative market to the cash market of a couple of countries.

Speaker #2: We have data for a lot of countries, but we selected just SX to show a large entity. Other large entities range from 1.7, 1.3—that type of range—to 1.5, which seems like the middle.

Speaker #2: We took Poland as one of the smaller first world countries that we felt could be compared to us, and their ratio of 0.8 shows that it's actually lower than the cash market activity.

Graham Law: We took Poland as one of the smaller first-world countries that we felt could be compared to us, and their ratio of 0.8 shows that it is actually lower than the cash market activity. What we are trying to articulate is that we are in startup phase. It took Poland probably towards the five-year mark to get to that level. It takes a while. It is not a one to three-year type time horizon before these markets become mature. We would expect to have to release other derivative products to get to maturity, and time will take us to build to that point. But really what I wanted to articulate was the size and the price and say that if we get to a multiple of 0.25, it happens to be about NZD 2.5 million in revenue is an estimate.

Speaker #2: What we're trying to articulate is that we're in the startup phase. It took Poland probably toward the five-year mark to get to that level.

Speaker #2: It takes a while. It's not a one- to three-year type time horizon before these markets become mature. We'd expect to have to release other derivative products to get to maturity.

Speaker #2: And time will take us to build to that point. But really, what I wanted to articulate was the size of the prize and say that if we get to multiples of 0.25, it happens to be about $2.5 million in revenues in estimate.

Speaker #2: That will clearly depend on the mix of where that comes from, and how much market maker activity is required to get to that point. But we just wanted to give an indicative size of prize.

Graham Law: That will clearly depend on the mix of where that comes from and how much market maker activity is required to get to that point. But we just wanted to give an indicative size of price.

Speaker #3: That's a great comment there—I appreciate that. Maybe for my follow-up, I'll stick with derivatives, but turn to dairy derivatives. I know you mentioned there weren't any speculative trades in the period.

Dave Storms: That is great, Colin. I appreciate that. Maybe my follow-up, just sticking with the derivatives, return of dairy derivatives. I know you mentioned that there were not any speculative trades in the period. Is there any further clarity you could give us as to maybe what this might look like in the H2 and your comfortability with the 2026 targets?

[Analyst]: That is great, Graham. I appreciate that. Maybe my follow-up, just sticking with the derivatives, return of dairy derivatives. I know you mentioned that there were not any speculative trades in the period. Is there any further clarity you could give us as to maybe what this might look like in the H2 and your comfortability with the 2026 targets?

Speaker #3: Is there any further clarity you could give us as to maybe what this might look like in the back half, and your comfortability with the 2026 targets?

Speaker #2: Yeah, we remain comfortable with the 2026 targets. People have seen the uptick in July's numbers, that we're actually positive on the lots. I still have no speculative trades.

Graham Law: Yeah, remain comfortable with the 2026 targets. People will have seen the uptick in July's numbers that were actually positive on the lots and still have no speculative trades. We are aware of parties that are interested in performing speculative trades but really need the market conditions to turn to the way they want to see them before they would push them through. Certainly that -5.7 has changed to, I think it was positive 0.6 at the end of July, and August has continued that pattern of improvement. I would have said that the Q3 last year compared to 2024 wasn't a particularly great quarter, so we are now seeing positive momentum ignoring the speculative trades. We feel comfortable with the targets. There is continued momentum in this field. We feel that this market will continue to mature.

Speaker #2: We are aware of parties that are interested in performing speculative trades, but really need the market conditions to turn the way they want to see them before they would push them through.

Speaker #2: So, certainly, that negative 5.7 has changed to—I think it was positive 0.6 at the end of July. And August has continued that pattern of improvement.

Speaker #2: I would have said that Q3 last year, compared to 2024, wasn't a particularly great quarter. So we are now seeing positive momentum, ignoring the speculative trades.

Speaker #2: We feel comfortable at the targets. There is continued momentum in this field. We just feel that this market will continue to mature as we head towards close to the 20-year mark.

Graham Law: We're heading towards close to the 20-year mark of having this product and offering. We're well beyond the point of no return. It will continue to take off, we feel. Simon, if you can move to slide 12. We have tried to articulate the sort of size and the price of other commodity markets, whether they're the right comparison or not, that's always open for judgment and debate. But if you take an average of four times, and we're sitting at just under last year, half the times the physical market, it shows you that there is scope to grow. Again, ironically, every 0.25 of a multiplier equals approximately NZD 2.5 million in revenue to us, again, depending on market maker and mix of where it comes from in terms of the actual underlying source.

Speaker #2: Having this product and offering, we're well beyond the point of no return. It will continue to take off, we feel.

Speaker #2: And again, on the slide, we have tried to—Simon, if you could move to slide 12—we have tried to articulate the sort of size of the prize of other commodity markets.

Speaker #2: You know, whether they're the right comparison or not—that's always open for judgment and debate. But if you take an average of four times, and we're sitting at just under last year's half of times the physical market, it shows you that there is scope to grow.

Speaker #2: And again, ironically, every 0.25 of a multiplier equals approximately $2.5 million in revenue to us. Again, depending on market maker and the mix of where it comes from in terms of the actual underlying source.

Speaker #2: So, for example, speculative trades tend to be at a lower rate than regular trades because of the volume of them. So I hope that sort of helps with trying to articulate the size of the prize on the graph in the bottom left.

Graham Law: For example, speculative trades tend to be at a lower rate than the regular trades because of the volume of them. I hope that sort of helps. We've tried to articulate the size and the price on the graph in the bottom left.

Speaker #3: That's great. I really appreciate it. I'll leave it there, and I'll thank you for taking my questions.

Dave Storms: That's great. Really appreciate it. I'll leave it there, and thank you for taking my questions.

[Analyst]: That's great. Really appreciate it. I'll leave it there, and thank you for taking my questions.

Speaker #2: Being crazy, yeah. I've just enabled your mic, so feel free to ask your question.

Simon Beattie: Ben Crozier, I have just enabled your mic, so feel free to ask your question. Perfect. Morning, guys. This one for me, just on the outlook for funds management. I think previously you were speaking within guidance, it was a more subdued or flat year-on-year comp for EBITDA and funds management, which was up to 9%, which is a strong result in the H1. Is it outperforming expectations, or are you still thinking a flat year-on-year EBITDA? That would imply quite a decent step up in updates, which does not sound like that is the case.

Simon Beattie: Ben Crozier, I have just enabled your mic, so feel free to ask your question.

Speaker #1: Perfect. Morning, guys. This one from me is just on the outlook for funds management. I think previously we were speaking sort of within guidance.

Ben Crozier: Perfect. Morning, guys. This one for me, just on the outlook for funds management. I think previously you were speaking within guidance, it was a more subdued or flat year-on-year comp for EBITDA and funds management, which was up to 9%, which is a strong result in the H1. Is it outperforming expectations, or are you still thinking a flat year-on-year EBITDA? That would imply quite a decent step up in updates, which does not sound like that is the case.

Speaker #1: It was a more subdued, or flat, year-on-year comp for EBITDA and funds management. Looks like it's up 9%, which is a strong result in the first half.

Speaker #1: Is that, you know, is it outperforming expectations, or are you still sort of thinking a flat year-on-year for EBITDA? That would imply quite a decent step up in opex, which doesn't sound like that's the case.

Speaker #2: Sorry, you're breaking up a little bit for me there, Ben, but I think I got the gist of it. If we could go to the SMART slide, which is probably—yep.

Graham Law: Sorry, you were breaking up a little bit for me there, Ben, but I think I got the gist of it. If we could go to the Smartshares slide, which is probably. I think, to answer your question, QuayStreet was a change which impacts those numbers, and you probably need to strip those out when you look at the non-QuayStreet related Smartshares business and how it has increased. From a cost-based perspective, we are heading towards a relaunch of the KiwiSaver in the Q4, and that has entailed layering on extra resources. As this business grows, at the moment, the automation is not fully there, and this gives us an opportunity to be more automated and be able to leverage the business a bit better, and that is some of the cost equation that you see there. Looking forward, I think we still remain bullish on the fund growth.

Speaker #2: I think, you know, to answer your question, Key Street was a change which impacts those numbers, and you probably need to strip those out when you look at the non-Key Street-related smart business and how it has increased.

Speaker #2: From a cost-based perspective, you know, we are heading towards a relaunch of the QE Saver in the fourth quarter, and that has entailed layering on extra resources.

Speaker #2: As this business grows at the moment, the automation isn't fully there, and this gives us an opportunity to be more automated and be able to leverage the business a bit better.

Speaker #2: And that's some of the cost equation that you see there. Looking forward, I think, you know, we still remain bullish on the fund growth. We think we can do better in QE saver, and that's what we've tried to articulate here—what our ambition is.

Graham Law: We think we can do better in KiwiSaver, and that is what we have tried to articulate here, what our ambition is and what we will target. You will see increased marketing come through to try and achieve that target. I think that is a signal that we want to certainly give, but we remain bullish in where this business can go and on how far it can go because of the tailwinds that are behind it, because KiwiSaver momentum is there with all political parties in terms of contribution rates, and we will see those contribution rates continue to increase. Not only that, but you must remember that, of course, as KiwiSaver matures, those that retire, their funds will not vanish from the system.

Speaker #2: And what we will target—you will see increased marketing come through to try and achieve that target, and I think that's a signal that we want to certainly give.

Speaker #2: But we remain bullish on where this business can go and how far it can go because of the tailwinds that are behind it, because KiwiSaver momentum is there with all political parties in terms of contribution rates.

Speaker #2: And we will see those contribution rates continue to increase. And not only that, but you must remember that, of course, as KiwiSaver matures, those that retire—their funds will not vanish from the system.

Speaker #2: And that's why having our product set outside of QE Saver and investable both in an ETF and a direct fund basis is very important.

Graham Law: That is why having our product set outside of KiwiSaver and investible both in an ETF and a direct fund basis is very important for capturing that maturity out of KiwiSaver. Hope that answered the question, Ben, but happy to add more if you like.

Speaker #2: For capturing that maturity out of QE saver. Hope that answered the question, Ben, but happy to add more if you like.

Speaker #1: Yeah, no, that was some good color. Just maybe on the funds' market share target—do you have a timeline for that?

Ben Crozier: Yeah, no, that was some good color. Just maybe on the market share target, do you have a timeline for that?

Speaker #2: Well, I think reducing our churn and increasing retention is the way that we go about that. It certainly will not happen overnight.

Graham Law: Well, I think reducing our churn and increasing churn to us is the way that we go about that. It certainly will not happen overnight. I think it will take probably the guts of the next 3 to 5 years rather than 1 to 3-year type timeline. But we will be reactive to what works and what does not work when we push the marketing button. We are not afraid to go harder and faster if we see something working.

Speaker #2: I think it will take, probably, the guts of the next three to five years, rather than a one- to three-year type timeline.

Speaker #2: But, you know, we'll just be reactive to what works and what doesn't work when we push the marketing button. We're not afraid to go harder and faster if we see something working.

Speaker #1: Yeah, that makes sense. Maybe just one last question on the optech side, sort of expanding it out to the fund registry side.

Ben Crozier: Yeah, that makes sense. Maybe this last one on the Wealthtech side, sort of expanding it out to the fund registry side. Are you in discussions now as part of that pipeline you just laid, is some of that fund registry stuff, or is that just still all the advisers part of the business?

Speaker #1: Like, are you in discussions now? Like, as part of that pipeline you displayed, does some of that fund registry stuff, or is that just still all the advisors' part of the business?

Speaker #2: The pipeline? No, not at this point. Though, we are hopeful that Leo at RFP may come up—you know, we do see an opportunity.

Graham Law: The pipeline, no, not at this point. We are hopeful that the odd RFP may come up. We do see an opportunity. The NZD 275 billion does include, for example, banks, which may not be accessible. I just do want to point that out. But there are those out there that do not want to have full reliance on certain aspects of the market, that we are aware of, and we see opportunity there to go into further parts of the market. So, I think previous discussions that we have, we have never really articulated the other two opportunities that are in the strategy set for NZX Wealth Technologies, and that is what we are trying to articulate here, that the size of the prize for NZX Wealth Technologies is not just the adviser market. We are expanding the markets, and we will expand our product and offering services to the benefit of our customers.

Speaker #2: The $275 billion does include, for example, banks, which may not be accessible. I just do want to point that out. But there are those out there that don't want to have full reliance on certain aspects of the market.

Speaker #2: That we're aware of, and we see opportunity there to go into further parts of the market. So, you know, I think in previous discussions that we've had, we have never really articulated the other two opportunities that are in the strategy set for wealth technologies.

Graham Law: So, I think previous discussions that we have, we have never really articulated the other two opportunities that are in the strategy set for NZX Wealth Technologies, and that is what we are trying to articulate here, that the size of the prize for NZX Wealth Technologies is not just the adviser market. We are expanding the markets, and we will expand our product and offering services to the benefit of our customers.

Speaker #2: And that's what we're trying to articulate here—that the size of the prize for wealth technologies is not just the advisor market.

Speaker #2: We are expanding the markets, and we will expand our products and service offerings to benefit customers. That said, it's largely the small and medium-sized advisor groups who will benefit, as the large ones already take advantage of their size.

Graham Law: Though, that said, it is largely the small and medium-sized adviser groups, as the large ones already take advantage of their size.

Speaker #1: Yeah. That's awesome. Thank you.

Simon Beattie: That is all for me. Thank you. There are no written questions. Are there any other further questions? There do not appear to be any other further questions from those online.

[Analyst]: That is all for me. Thank you.

Speaker #3: There are no written questions. Are there any further questions? There don't appear to be any further questions from those online.

Simon Beattie: There are no written questions. Are there any other further questions? There do not appear to be any other further questions from those online.

Speaker #2: Okay, look, thank you very much, everyone, for attending today. As usual, EME, Simon, and myself are always available. Should anyone wish to catch up with us, please reach out if you have any additional questions.

Graham Law: Okay. Look, thank you very much, everyone, for attending today. As usual, Amy, Simon, and myself are always available. Should anyone wish to catch up with us, please reach out if you have any additional questions. Thank you.

Speaker #2: Thank you.

Simon Beattie: Thank you.

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