Amotiv Limited (AOV) Earnings Call Transcript & Summary

Thank you for standing by, and welcome to the Amotiv Limited FY '26 Results Call. [Operator Instructions] I would now like to hand the conference over to Mr. Graeme Whickman, Managing Director and CEO. Please go ahead.

Well, thank you. Welcome to Amotiv's result call for the full year ended 30 June 2026. I'm Graeme, as you know, the Managing Director and CEO, and I'm here with Aaron Canning, the Chief Financial Officer, again, not a stranger to the people assembled on the call. Talking of the call, it will be recorded, and that will be up on the website along with the presentation material a little later on today. Now you would have seen the second announcement released this morning regarding CEO succession. I'll come back to that at the end of my remarks before we go to questions. But today is actually about the FY '26 result. And so let's start there. And I'm pretty pleased with that. If you look at the first slide, you'll see that we're going to go through some key messages, the group performance, and then step through the 3 divisions. I'll cover off 2 group-wide items, sort of around how recycling capital into higher returning opportunities. And then secondly, the progress on Unified. Aaron will take you through the financials in more detail. And then I'll close with an FY '27 outlook before we open the line for questions. So let's get straight into it. Slide 2, from left to right, firstly, Aaron and I and the rest of the team said that we would deliver approximately $195 million of underlying in FY '26. We said that 12 months ago, and I think we reiterated that probably 3 or 4 times through the course of the year. And then we've gone on and actually delivered $195.1 million. We apologize for being $100,000 out. But I'm sure you'll forgive us. We did that, of course, in an environment that became harder as the year progressed. So I'm really pleased that we actually beat that guidance by the $100,000. The result, I think, was a reflection of some disciplined execution and the benefits of a multiyear diversification strategy we've spoken about in the past. Unified delivered the benefits we committed to exiting FY '26, the programs generated about $15 million in net benefits, and I'm going to unpack that later on. It sort of mitigated some of the segment level macro pressures through what I would say is a more streamlined and efficient operating model. And this program has now evolved from a pure efficiency program into one that is funding a defined set of growth engines. So we're always talking about efficiency and effectiveness. Thirdly, the cash generation was resilient. It was actually super when you think about a conversion, nearly 93-ish percent and net funded. The higher return of capital to shareholders and ultimately also a lower leverage position at the same time. So a big tick there. And then finally, racing to the right-hand side of the slide, we expect, Aaron and I, that is, to see modest revenue underlying EBITDA growth in FY '27. And this, in essence, is supported with growing offshore revenue, pricing, Amotiv Unified benefits offsetting some subdued ANZ conditions. So let's turn to sort of the group performance at the macro level from a company perspective. So revenue diversification has been a core pillar of our strategy. So it's pleasing to see the revenue of just over $1 billion, up 2.7%, and that was against subdued ANZ conditions when you think it through. That growth was predominantly volume and filtration and also 4-wheel drive new business wins and that's reflecting the investment we've been making, plus a growing contribution from offshore markets, complemented by base pricing. Our gross margin of 42.8% was 1 percentage point below prior year. Although we'll like to get some questions, the exit rate was actually higher than that, and we can unpack that a little later on, quite an encouraging exit rate. The pricing actions in 4-wheel drive and PTU improved those second half margins, but costs ran ahead of the price for the first part of the year. As I've already mentioned, the underlying EBITDA increased about 1.6% to the $195.1 million, in line with our guidance, just above our guidance, actually. And the segment bridge on the slide gives you a sense, the primary drivers were LPE's offshore contribution, powertrains ongoing growth, and they grew ahead of system, which was fantastic. Amotiv Unified benefits, but it was partially offset by 4-wheel drive with a bit of a timing gap on the pricing, which we'll talk about a little later on. Underlying EPSA growth was 4.5%. It was ahead of EBITA growth, reflecting the completion of the buyback. Cash conversion, I've mentioned, 93.1% improved 2.5 percentage points of what was already a strong base. And this characteristic, and it's a strong characteristic of the business allowed us to complete the back end of the buyback, lift both the interim and final dividend and basically return close to $75 million in cash to shareholders at the same time, still reducing that leverage, which is on the slide there. ROCE improved 30 basis points to 13.4%. Although Aaron and I recognize we're not where we want to be with ROCE, but we still have improved. 15% remains a target, and that's the measure we hold ourselves to, and you'll see the capital allocation framework a little later on, but still, again, some improvement and more to come from our point of view. If you think about what's happened on the next slide in terms of a reminder, strategic footprint, 3 things on this slide are worth pausing on. The first is the balance. So the 3 divisions, similar scale, 36%, 31%, 33% revenue. The 73-ish percent of revenue, ICE agnostic kind of important. So it means that we're not reliant on any single division or category, and we're largely insulated from the pace of any powertrain transition as well. The second on the slide is the offshore contribution now at 18% of revenue, up from effectively nothing 5 years ago. And you've known as you follow us that this has been built deliberately. It's been a significant part of the buffer against continued subdued ANZ conditions. And frankly, our aspirations on that offshore revenue, I think, are pretty material as we go forward, and I feel very confident we can actually deliver growth -- continued growth there. The third is the manufacturing footprint on the slide, and it's strategically located. It's multiregional purposely, and it is a genuine competitive advantage. It sort of underpins that cost position of the core ANZ business. And it's the platform for both the European OE and the U.S.A. program wins, which we'll talk a bit more about later on. It's all supplied from Thailand. As I said before, we want to sweat that manufacturing assets. It's a bit guttl the statement, but sweating that asset is important in terms of the ROCE expectations we have out of the 4-wheel drive division. So turning to Slide 5. Giving a bit of a flavor, we had this slide at the half where we said what's happened in the first half. This slide is about what's happened since the first half and the second half. In Powertrain and Undercar, we're excited to lift our shareholding in our Vietnamese filtration manufacturing partner. We're going to talk about that a little later on from 20% to 40%, and it's happened since the -- since we last spoke at the first half. That deepens the vertical integration behind Ryco and Wesfil, increases our U.S. exposure in a positive way. And that's on Slide 11. We'll get there in a second or 2. We've also continued to expand in the ANZ independent channel. We've increased our ranging, that's delivered strong growth, and we've seen some excellent growth in New Zealand on the basis of that also. In LPE, the U.S. and European growth continued. And of course, that offset a bit of a muted ANZ market. We've continued to invest in the offshore resourcing and capability, and we're going to chat again about that later. And we've also divested Twisted Throttle. That's simplifying our U.S. operations. In 4-wheel drive, since the half because we had some great news in the first half, we've also secured more OEM wins in Europe, all out of Thailand. It's one additional Kia model on top of the EV6, the 2 Hyundai models and the Suzuki models that we spoke about, and they all start supply from late calendar year '27. We've got the towing component supply for the BYD Shark, that's commenced in the second half. And then we've started the consolidation of the Cruisemaster manufacturing. So we're bringing that Brisbane site, closing and bringing that down to Keysborough, making sure that we sort of maximize the concrete we have in Keysborough or in other situations we're offshore into Thailand. So again, all very deliberate, and that will happen in the first half of FY '27. And then if you think bottom right, from a Unified point of view, we've made good progress on a tech stack. It's the ERP consolidation commenced in the background. In this half just gone, we've transitioned to a single ANZ payroll system. We're piloting our new Amotiv-wide warehouse management system at Softeon, that's being trialed in New Zealand this half as it gets rolled out. So the momentum around the consolidation of systems and tech stacks and even data has continued with good pace. So let's now turn -- let's get more into the strategic business units. So the businesses we would want to call them. Starting with 4-wheel drive. Well, revenue grew just under 4%, up to just shy of $370 million, all on the back of new business wins. I've mentioned those just a few minutes ago. It also included a full period of South Africa and a bit of second half pricing, which came and offset a little bit of an ANZ volume situation. Underlying EBITDA was just short of $53 million, so $52.8 million, that was down 10.9% with margin down 2.4 percentage points at 14.3% and I'll unpack what sits behind that and what's changed. And I'm sure we'll get questions around what was the exit rate in the second half versus the full year, and that's encouraging news when we get to that. The market went backwards, though. If you think about the market that the 4-wheel drive team service or serve, I should say, that was down. ANZ pickup volumes were down about 3%, excluding the BYD Shark with the likes of Ranger down 5%, Hilux down 7%. And so we've got to take that for what it is. Importantly, the pickup equipment rates remain stable. But then when you sort of unpick even those numbers, the annual numbers don't tell the full story. Pickup sales were actually up in that first half and then really plummeted in the second half, 8% actually. And then within that second half, the third quarter was 2%, but the fourth quarter was down 13%. And we saw obviously a lot of noise through what's going on at a macro level in terms of Middle East and the like. That fourth quarter exit rate is probably the sharpest move we've seen all year, and that's why we're planning FY '27 on the basis that the new vehicle sales will stay soft, and we'll get to that when we talk about the outlook. The second factor was pricing timing. So we took out-of-cycle OEM pricing, but only benefited the second half, and you can see the effect in the numbers. The second half underlying EBIT margin was actually 14.9%. So close to 110 basis points higher than the first half, and that was also helped by the nonrecurrence of a first half Zone RV provision. Three things changed the margin trajectory from here. And all 3 are within our control. So the FY '26 out-of-cycle pricing annualizes into this year. We have further aftermarket and out-of-cycle OEM pricing planned for the first half of FY '27. And then the offshore programs begin to contribute. So the Nissan Navara also moves to the first quarter FY '27 supply. We have South Africa orders in hand for both Mazda and Mahindra. So this is the next set of customers in South Africa, which is excellent. And the European OEM wins supply from late calendar year '27. So those are some of the things that are rolling through as we think about FY '27. On the U.K., the presence we've established supports those European OE towbar wins. And we expect -- and this is probably the first time we've come forward and started to talk about some of the volume context. But we expect FY '28 volumes of perhaps between 30,000 to 60,000 units. So somewhere between a 7% and sort of 14% uplift on the FY '26 volume with more in the pipeline. And in the U.S., we're not contextualizing the volume there, but the momentum is building through the U-Haul volume and also secondarily, the Cruisemaster penetration. So with a factory that was pushing out somewhere between 400,000 to 430,000 units in rough terms, you can start to see the sort of percentage improvements in terms of volume throughput that are coming in the future state, which I think is testimony to the work that Jason and the team have been doing. Cruisemaster continue to gain share in what remains a really soft Australian caravan and RV market, but it certainly positions it well for when that market turns. And you've got some cyclicality that's rolling through and this division is the most exposed to it, whether it be caravans, whether it be RVs, whether it be the pickups, whether it be the likes of the SUVs. And then finally, I want to spend a moment on the chart on the bottom right. And that shows the 4-wheel drive continues to win, which is pleasing for us, the team there with the growing sort of new Chinese OEMs. And with that growth -- with that win, it just basically says that we're protecting our strong market position. And that's important. The Chinese OEM sales in Australia and the addressable market of pickups and the medium SUVs reached close to 96,000 units in the second half, more than triple the first half of FY '25. So you can sort of see the comparison there. And you can see just how much coverage that we have as a supplier to all those new customers, and I want to talk about that on the next slide. BYD self-supplies towbars for the Shark and that model is around 10% of those units. But importantly, we've been supplying towbar components to that same 3.5 BYD Shark performance variant in the second half. So we'll have some content on the Shark as well. But the other 90%, as you can see there, 86,000 units in that half are brands where we're already the towbar supplier. And as you can see in the lighter blue band in the middle, the pickup component has been broadly flat at around 10,000 units in H1 and H2. So effectively, all the growth has come from SUVs when you think about the Chinese OEMs. And that's an important distinction because the towbar and accessory content is driven by vehicle class, not by brand or where the vehicle was built. So a higher payload pickup has much higher content in terms of fitment rate than, say, an SUV. So what we're seeing there is a bit of a negative mix effect as some of those units are coming in and the higher content newer Chinese pickups have only recently arrived or actually, frankly, are still arriving, which kind of brings me to the next slide. And we've had some questions as to how does this all come together. And what you can see here is that 4-wheel drive have continued to win with the new Chinese OEMs. And on this slide, you can see the position we've built. And I'd encourage you to spend time on this when you have a moment or 2 because on the left-hand side of the slide, you can see we've got supply relationships with every major Chinese OEM selling into this market. So BYD, GWM, Cherry, MG, LDV, Geely, Jaecoo, even down to the smaller ones, Zeekr, JAC, the list goes on, Foton, Xpeng, Forthing. And the other thing is not that we can disclose it, but we're also actively engaged with gaining the business with a further 7 brands that you wouldn't even heard of that enter into Australia. And of course, from a commercial sensitivity point of view, we can't actually speak to their names. But all that tells you is that we are the preeminent go-to supplier, and we have gained the relationship with all those Chinese brands. And then on the right-hand side, you can see what I mean about content. So we're sort of showing here some of the meaningful pickups and some of the meaningful large SUVs. And if you look at the pickups, the GWM Canon, the Alpha, the T60, the JAC T9, the Hunter, all those carry towbars in addition to other functional accessories. And you can see tick, tick, tick, tick that we are the supplier. So when you take the lens back and think of the 50-plus models we supply products to, it's actually a testimony to Jason and the rest of the team on the basis of the product development investment we've made, and we've spoken about before. And again, it just reinforces what protects our market position. And there's some slides later on in the appendix when you have time, you can actually see that in an even more meaningful way. And that's a reflection of all the relationships that are already in place across the full set. So quite a lot about forward drive there, but I really wanted to reinforce how we are protecting our business. Let's move to Lighting, Power and Electrical. So the revenue was broadly flat. It was kind of slightly down 0.7% with record growth in U.S. and Europe, and that mitigated the soft ANZ demand. By category, Lighting, half of the divisional revenue was down about 1 point with Vision X unit growth in the U.S. and Europe, supported by new customer wins and improved supply lead times offsetting a muted ANZ situation and predominantly the reseller channels. Power management was up 3% on continued growth in the premium RV products, including Projecta's pretty recent market-leading 48-volt system. We're kind of #1 there in the market. We are the first to market, which is fantastic. Electrical and accessories was down 3%, constrained by that ANZ reseller demand. The channel view, which is on the bottom right underneath tells the story more sharply. So ANZ resellers now about 40% of the division were down 7%. ANZ Caravan, RV and truck, about 90% of the revenue. They were down 8%. And then offshore, about 34% of our revenue was actually up 12%. So the growth in offshore and cyclical ANZ factors are changing the shape of the division. Underlying EBITA was up 11%, just over 11% to $75 million and change, $75 million and change, with margin expansion of 2.5 percentage points, approaching 24%, so about 23.8%. The largest driver was the Unified benefits delivering a leaner operating model. Operating costs were actually 11% lower last year. Improved Vision X pricing and product mix also supported the earnings. I'd also note that the result includes a one-off legal benefit of about $2 million, where the associated costs were recorded in the prior periods. Looking forward, the U.S. and European growth is expected to provide further revenue diversification. Vision X has been announced as the official lighting partner of CFMOTO U.S.A., that's really exciting. Very pleased about that, well done to the team there. The new-to-market projected 48-volt system I just mentioned, that's expected to support OEM and OES growth. And then the annualized benefits of the U.S. tariff-related pricing continue through the first half of FY '27. The unified benefits continue, and that's moderated by the end of the half as the savings annualize, and we do expect the ANZ reseller conditions to remain subdued, certainly in the near term. And then we go to the third of our SBUs, Powertrain and Undercar. What a great result, another excellent result where revenue growth was once again outpacing system growth, well done to the teams there. The system growth is 1.5% to 2%, we're actually outpacing that almost double, in fact, more than double. Revenue increased 4.7%, just shy of $340 million. It reflected unit growth and strategic price increases that Aaron and I had shared, and we have executed that across the product categories. Our growth was led by filtration and brakes, with continued diversification into adjacencies. New Zealand revenue was up nearly 23% against what was a soft PCP, but that was driven by enhanced distribution across filtration between a couple of our brands there. And Ryco was named the GPC Asia Pacific Supplier of the Year for across all of Asia Pacific, so well done there. And I think that's a great testimony to the level of ranging and product development and customer service that, that team consistently delivers. Underlying EBITDA was $78.8 million. It was up 2.1%, with margin improving half-on-half against a pretty strong FY '25 comparative, although the full year margin of 23.2% was marginally below prior year. Gross margins improved through the second half, largely on mix. At the EBITA line, that was offset by some incentives and some transitory logistics costs. The EV repair and remanufacturing business made meaningful progress. Accelerating growth combined with moderating investment levels drove a meaningful improvement in profitability. And the business remains on track to breakeven as we committed by FY '27 on a run rate basis. And illustratively, we put on the slide there, some of the growth in terms of trajectory around where that business, Infinitev, that is gaining revenue, whether it be from a hybrid, a PHEV or an EV. And so it's off a small base, but you can see it's starting to take shape, and that's why we're quite pleased and thought it was representative to put into the deck. Now we continue to invest in the Australian backbone. So we -- as part of that improvement in terms of the cost base, not so much now the revenue on the bottom right of that slide, the operations for Infinitev have been consolidated. That was into a single site with IMG. The ERP was rationalized for our clutch business. The technology road map and the warehouse rationalization took place. We did see some modest price increases across PTU as we spoke, and they were implemented in the second half. We've got more pricing to take effect in the first quarter of FY '27. And as you would expect and as we've communicated, we'll invest in the Australian warehouse footprint in FY '27 as part of Unified. So that will also support the independent channel expansion. It's all coming nicely together in that regard. On Slide 11, I'd sort of touch on portfolio optimization. This slide sets out 3 decisions that taken together, recycle capital out of subscale positions in the group and into a higher returning one. The investments in filtration. So as I mentioned earlier on, we've agreed to increase our shareholding in VAFI. So that's a Vietnamese-based filtration manufacturer. It has both Chinese and Vietnamese. We already have ownership in the Chinese piece, and we're expanding that in our Vietnamese piece. And it's a leading U.S. supplier to the aftermarket in the U.S. as much as it is part of the group that's supplying us. And so we're going from 20% today to 40% from the first quarter with exclusive optionality to increase that progressively from there. Ownership structure is related to existing Ryco and Wesfil suppliers as I mentioned. So this is a business we know well. We've worked with for decades. And so we're pleased with the outcome. Consideration is approximately $15 million for approximately 20%, subject to all the customary working capital adjustments. That business in VAFI is actually expanding capacity and be it right now. Aaron and I were out there recently. It's a greenfield site. We expect continued double-digit revenue growth from that acquisition. The interest will be equity accounted. Signing is expected in mid-August with completion at the end of August. That's a great outcome. That partly funding, that is the 2 divestments, East Coast Bullbars. Essentially, as we look to our portfolio, it's subscale as it stands at the moment in terms of manufacturing. And with the way the market is at the moment, we're looking at the limited growth potential. Proceeds just over $11 million, completion in early July has done. The cost to rationalize -- our original thinking, cost to rationalize and take that business to Keysborough was the original thought, but the forecast returns don't meet the internal hurdles we have, particularly given the other higher returning consolidation opportunities, which, as an example, will be Cruisemaster, and we've touched on that earlier. So Cruisemaster going down to Keysborough. And then obviously, the smaller contribution was Twisted Throttle. So the net effect from these changes will be around a 20 basis point uplift to group ROCE, again, just part of the pathway to where we want to be. And that's all about the capital allocation framework working as intended. So recycling capital out of low-growth subscale assets and into higher returning opportunities. So then I just want to touch on Unified before I ask Aaron to just take us through some of the financials. So we announced Unified, very clear in terms of what we wanted in 2025 in February, 3-wave, 3-year program. Exiting FY '25, we delivered $15 million gross benefits with $5 million reinvested, so $10 million net. Through FY '26, we added another $10 million gross with another $5 million invested. So that takes the cumulative gross annualized exiting FY '26 to about $25 million, $10 million rest into brands, new product development capability and then $15 million net flowing through to the underlying EBIT. So we said we'd deliver these benefits, and we have. What's changed going forward is the character of the program. So we've been prioritizing efficiency projects, which are on the left of the slide, warehouse network, Unified tech stack, data, common indirect sourcing, Projecta's AI acceleration, et cetera. And all of those are now increasingly funding the growth engine on the right, which clearly we're about top line growth. So the omnichannel work recently, we've just stood up navara.com, projecta.com, denali.com is doing very well, so omnichannel capability. The international expansion, you can see the growth we already had, and we're actually doubling down on that quite materially at the moment. And then the ANZ independent channel expansion. They're all active. They're all work in progress with varying states of progressiveness. The OEM cross-sell is in preparation and the ANZ Fitment & Fleet is a future phase. So the shared service operating model is moving to its execution phase from the first quarter of FY '27, and we'd expect to see some net benefits from this program, and they're already included in the FY '27 guidance. So we're getting some good momentum on our Unified program, methodical, as we said, leader-led and starting to realize the benefits either from an efficiency or indeed an effectiveness. So I'll take a pause. You probably heard my voice too much and perhaps pass to Aaron, and I'll ask him to take you through some of the finer points of the financial results. So Aaron, please, over to you.

Well, thank you, Graeme, and good morning, everyone. My name is Aaron Canning. I have the pleasure of being Amotiv Group CFO. I'll take you through the FY '26 financial results in more detail. Just on to the next slide. Our reported revenue grew 2.7%, reflected all organic growth. And as Graeme touched on, was driven by 4-wheel drive revenue wins from new business, including the full year period impact of South Africa, my apologies, plus out-of-cycle OE pricing really starting to take effect through the majority of the second half. And these were the key drivers behind that strategic business unit growing 3.8% in revenue. LPE, the Lighting, Power & Electrical Division, the revenue declined very marginally by 0.7%. And really, it was a tale of continued growth in the U.S. and Europe, which I would note both delivered record revenue, mitigating soft ANZ reseller demand. Powertrain and Undercar revenue continues to outpace the market through its resilient wear and repair brands with top line revenue growth of 4.7%, leading through really a diverse aftermarket brand portfolio. And as Graeme touched on earlier, we're very pleased with our accelerating growth in our EV repair and remanufacturing business in Infinitev. Growth at a category and brand level was very much led by filtration and brakes with continued diversification into adjacency categories, particularly in the independent channel. Gross profit increased 0.4% with margins improving through the second half, largely due to the OE pricing in 4-wheel drive starting to take effect from earlier in the half. This was also further supported by the regular pricing cadence that we have in our LPE division domestically in the second half and importantly, a full 6-month benefit of our 10% post-tariff price increasing for Vision X in the U.S.A. Pleasingly, on the operating cost line, they were lower by 0.9%, more than offsetting inflationary increases. And this is largely a reflection from the benefit of the Amotiv Unified program flowing through in combination with a focus on disciplined cost management. Operating costs also included higher incentives, to the value of $4.5 million in the '26 year versus the PCP. And if I exclude those, operating costs would have been 3% lower year-on-year on a like-for-like basis. Depreciation and amortization were marginally up by 1.6%, really reflecting our higher CapEx investment, which I'll touch on in a moment. Underlying EBITA was $195.1 million, in line with our guidance and marginally up by 1.6% versus PCP in what became an increasingly more challenging market, particularly through the latter half of the second half of this year. Significant items, they totaled $35 million, of which $15.8 million is a noncash impairment on the divestment of the East Coast or ECB Bullbars business, which Graeme spoke to earlier. Excluding this, total cash significant items were just under $20 million, $19.9 million, with those cash costs marginally higher in the second half versus the first half, particularly related to Amotiv Unified program costs. The prior year, of course, included a $190 million noncash impairment related to APG. A more detailed breakdown of all significant items is provided in the appendix on Slide 26 of this presentation. On our taxation line, the expense grew by 12.6%, largely attributable to earnings growth with a slightly higher effective tax rate of 27.7% versus 25.9% in the PCP. And I would note as well a further breakdown of our effective tax rate calculations is provided in the appendix on Slide 27. Our statutory net profit after tax at $75.1 million reflected a meaningful turnaround versus the prior year, which was impacted by the APG impairment, as I said earlier. Pleasingly, when it comes to shareholder returns, the business has continued to deliver growth across all metrics as presented. Underlying EPSA grew 4.5%, largely due to a combination of earnings growth and lower shares on issue on completion of the buyback at the end of the first quarter of this year. The Board approved on a dividend basis, an increase to the final dividend of $0.01 per share, bringing this to $0.23 per share. And for the full year, a 6.2% increase in dividends versus last year at a payout ratio slightly higher as well of 55%. And pleasingly, we have been able to return $74.8 million cash to our shareholders in the '26 year due to a combination of buyback and dividends paid in the year. And we've been able to do that as well as reducing our debt. As we turn our attention to the following page, when it comes to our balance sheet, look, the balance sheet is in great shape. Net working capital was well managed. Importantly, we continue to see further opportunities to drive efficiencies, particularly in inventory without impacting growth, and particularly within our Lighting, Power and Electrical division as we look to improve our inventory management. Net working capital percentage of revenue at 28.5%, remains ahead of most comparable external benchmarks that we compare ourselves to, and we remain broadly consistent with our prior periods. That being said, however, we do believe there's further opportunity to improve. I'll now unpack working capital in just a little more detail. At an inventory level, inventory increased just over $12 million, $12.4 million since June of 2025. It moderated lower through the second half as the benefits from our concerted efforts in this space became more evident. As mentioned earlier, we do see further improvements when it comes to improving inventory turns and returns. In the Lighting, Power and Electrical division, we have carried higher levels of inventory for our Vision X business in the U.S. post those U.S. tariff changes. And we've done this consciously. We want to make sure we've got the right inventory in the right place in country to meet the growing demand in that geography. To balance this, we have sought to rebalance our holdings in Australia commensurate with a reseller demand that has been more muted. And this has been the driver behind that -- the inventory performance in that division, and we see that thematic continuing into '27. At a full drive level, inventory levels across ANZ were predominantly impacted by customer ordering timing, but it's important to note that this business is mostly a made-to-order business. And so most of the finished goods are either sitting in transit to be made or in the progress of being made to meet customer orders. In the Powertrain and Undercar division, we continue our work on consolidating our logistics and warehousing footprint as part of Amotiv Unified, and that work has continued through the year. And we've continued to perform strongly in filtration as well in the year, particularly against a backdrop of increased domestic competition. And we took the opportunity through the latter half of the year to actually increase inventory in filtration. And so we've actually ended the year higher on an inventory basis for that division. But that's to offset some challenges we had going into the beginning of '26 in relation to DIFOT challenges. And I can report now we have started the year strongly in relation to filtration. Payables, marginally ahead of prior periods, largely related to inventory purchasing timing, no significant change to terms or suppliers. And pleasingly, on receivables, we've held that flat despite revenue growth of 2.7%. Collections have improved, particularly through the second half. The aging profile of the balances has also improved. There's no significant provisions for the year-end. There's no repeat of any additional exposure or risk identified in relation to the changing domestic caravan/RV market, which we saw in the first half with the provision we took for Zone RV in 4-wheel drive. However, we've continued to watch that channel particularly closely as the caravan/RV market undergoes quite a significant change from a domestic-focused industry to more of an import-focused industry. For transparency, we continue to reduce our levels of debtor factoring. I've said that before. And pleasingly, we've done that again in these results. Directing to the bottom right of the slide, cash conversion, again, very, very strong at just over 93%. It's a hallmark of the resilience of this business, and it continues to deliver consistent market-leading cash outcomes. You can see the strength of the business really through a number of periods and a number of cycles there. It's delivered cash results there that regardless of the macro environment are very, very strong. Importantly, as we look forward into '27, we would expect similar levels of cash performance to what we've delivered since 2024. And I would note these outcomes are consistently ahead of our capital allocation targets of above 75%. As we turn our attention to the next page. Our capital investment, particularly in product -- sorry, capital investment has really been a hallmark of an enabler to our growth this year, particularly in offshore. Our investment in product development has increased year-on-year to 3.8% of revenue and reflects both operating expenditure and capitalized R&D investment, most notably in the 4-wheel drive business. That's been a key driver in underperforming our resilience as a group, as I said earlier, through '26. These investment levels at 3.8% of revenue were in line with what we reported in the first half. And as we look forward to '27, we would expect similar levels of PD investment as a proportion of revenue around the 3.5% to 4%. Capital expenditure to the graph in the middle was up marginally 3.5% on the prior year, continues to be supported by investment in 4-wheel drive as well as capitalized R&D and that business as we continue to look to better align the timing of investment, particularly with OEs in that division with the revenue-generated profile of those future business wins. And as we finish the year as well, the Thailand expansion is now largely complete with further optimization of that facility continuing into '27. On the right-hand side of the slide, we continue to balance our investment both between maintaining and investing in what we have today as well as balancing that to investing in future growth. And these investment levels are also very aligned to our capital allocation targets. On to the following slide, when it comes to foreign exchange, the chart on the top right-hand side, the first half of our results of '26 were impacted by a weaker AUD/USD cross versus the PCP. However, this impact partially unwound through our hedging position through the second half, and we benefited from both a strategic hedging strategy as well as an appreciating Australian dollar. This benefit, particularly in the second half was helpful for us in partially offsetting inflationary cost increases such as fuel surcharges and rising freight costs, particularly through the latter half of FY '26. As we look into '27, in the first half of '27, we are effectively hedged 100% against the U.S. dollar. And this chart is just showing the Australian-U.S. dollar cross as a proxy. We obviously have other exposures as well, but it's a pretty good guide in terms of how we're thinking about '27. And the first half of '27 on the U.S. dollar cross, we're in essence a $0.04 above the PCP and $0.02 ahead of the second half of '26. And on the other primary currencies, we remain highly hedged across all of those through the first half of '27, including the Thai baht, which is -- which the vast majority of those are favorable versus the prior year. And as we look to the second half of 2027, obviously, if rates stay around $0.70 where they are at the moment, this will obviously be beneficial into the second half of 2027 versus the PCP. Importantly, when it comes to foreign exchange, though, building our natural hedge and growing our offshore earnings is an important part of the story here. It builds a natural hedge, whether it be in U.S. dollar earnings or Asia currency earnings. For this year, for 2026, U.S. dollar earnings now contribute 17% of our post-tax earnings before amortization. And combined, U.S. and non-ANZ earnings now represent 32% of our total post-tax earnings for the year versus 25% in the PCP. We see this growth in offshore earnings continuing and this trend continuing as we go into '27. On to the next slide, in terms of our leverage position and our debt position, we have delevered, as we said we would do when we set our guidance in August of last year through the second half of this year. Leverage at June is at 1.85x, well within our target range of 1.5x to 2.25x. Furthermore, as I mentioned earlier, it's worth noting leverage has improved through '26 post the completion of the buyback and post increases to dividend as well as increases in product development spend. The business has again continued to deliver stable and predictable cash flow earnings in what is an increasingly uncertain environment. Our debt profile into the middle chart remains long dated, approximately 2/3 fixed at market-leading rates. As such, any recent or future changes in the Australian domestic interest rate environment will have a relatively low impact for us. And as a guide, a 25 basis point increase or decrease domestically has about a 0.3 NPAT impact for us. We remain strong -- we have strong support from all of our lender group with an appetite for further support should we need it. And we're actually in the process of refinancing right now, and we will look to complete that before the end of the first half of '27, and extend that debt maturity profile out to the right of that chart. And just lastly, on the slide to the right-hand side of the chart, our cost of funds increased very, very marginally in the year by 9 basis points, largely reflecting maturing swaps and a changing domestic interest rate environment. And then just on to our last slide before I hand back to Graeme. In terms of our capital allocation framework, in February 2025, we announced this capital allocation framework. It really is a guide for how we choose to invest and where we choose to invest shareholders' money and the returns that we are holding ourselves accountable to when we deploy that capital, both for organic and inorganic investments. Importantly, these metrics, in particular, return on capital employed form part of management's long-term incentive program, and that 15% metric is what Graeme touched before, is part of that. As the CFO, it's pleasing to report on behalf of the business and all of the teams for 2026, we have performed in line or ahead of all of those metrics presented on this page with the exception of return on capital, although that has improved 30 basis points, that 15% metric is a FY '28 medium-term target, but we're encouraged by the progress we're making towards that. For transparency, we continue to measure ourselves on that metric against a pre-APG impairment metric. And we've footnoted that at the bottom of the page. If we weren't to adjust for that, our return on capital would, in fact, be 15.7%. So look, very pleasing set of results, whether it be cash flow, P&L, balance sheet, capital allocation, we remain well placed from a financial health point of view as we step into FY '27. And on that basis, I'll now hand you back to Graeme to discuss our '27 outlook.

Well, thanks, Aaron -- thank you very much, Aaron. That's really cool. I think that last slide, lots of green. And I think Aaron has done a great job in terms of sort of articulating that. So I probably don't want to belabor the point other than to say well done to us in the wider Amotiv team. Let's just talk about outlooks though. So let's go to the last slide in the deck in terms of the FY '27 outlook, that's Slide 21. Aaron and I are communicating that you should expect modest revenue and underlying EBITDA growth in FY '27 with growing offshore revenue, pricing, Amotiv Unified offsetting some subdued ANZ conditions. As the footnote sets out, that's based obviously on the continuing operations, the like-for-like growth after the ECB divestment. Now sitting behind that, it also assumes the continuation of what I'd say, the prevailing economic and trading conditions with no material sort of adverse events, probably sat here at this time last year and said the same thing. And then suddenly, we had some stuff going on in the Middle East. But it also includes the further amount of Unified net benefits and no further material deterioration in those prevailing conditions over the remainder of FY '27. We expect growing offshore contribution from the U.S. and European markets. So we continue that subdued trading along with the other items I just spoke of. In 4-wheel drive, the business remains well positioned for continued growth in that Chinese OEM mix. I spoke about with new vehicle launches that come into FY '27. The FY '26 pricing annualizes. There's further out-of-cycle pricing in the first half of FY '27. Having said that, though, the new vehicle sales, pickups and medium SUVs plus and above do expect -- or we are expecting to remain soft. In Lighting, Power and Electrical, the U.S. and Europe growth is expected to continue. We're excited about that, things like CFMOTO and the like. EBITA margins are expected to moderate slightly versus FY '26 due to the absence of the prior year one-off and ongoing investment in the U.S. market. And then ANZ headwinds are expected to persist. That's at that macro level. In Powertrain and Undercar, wear and repair categories are expected to remain resilient. Infinitev is on track to break even by the end of FY '27 on a run rate basis. And then if you pull the lens all the way back across the motive, the pricing benefits are expected to skew into the second half. And that's particularly around 4-wheel drive and PTU timing and then the LPE changes to be enacted in that H2 period more than anything else. Our balance sheet strength remains in a good position. Strong cash performance are expected to be maintained, and that will always provide flexibility to support growth. And secondarily and just as important, capital management, including the potential for buyback optionality, which we review all the time. Further Amotiv Unified benefits are expected to support the guidance, driven by some of the prioritized efficiency programs and also growth engine outcomes. And of course, all the while, we are closely monitoring what's happening in the Middle East and whether there are any further issues that we need to contemplate to mitigate against in terms of end user demand. But like always, our focus, Aaron and I and the rest of the team is about remaining around the factors that we control, that notion of controlling the controllables. So that's how I'd sort of characterize the outlook. Before we conclude the presentation, in terms of results, I think -- and before we go to questions, I just want to turn to this morning's other announcement. So today, announced that I'd step down as the Managing Director, Chief Executive Officer. And so the Board have commenced what I would call a structured and we, as a Board member as well, have commenced a structured an orderly CEO succession process. Look, I've led Amotiv for 8 years, and I believe it's the right time for me to begin that next chapter of my career and for the company to go and find its next leader. Over the last 8 years, the group has expanded, it's globalized, it's transformed into a streamlined pure-play automotive group. And it certainly is a materially different business today, certainly from the one I joined all the way back in 2018. But it's time, as you would expect after 8 years to reflect that it's time for me to move on. Automotive revenue in that time and underlying EBITA has increased approximately 2.5x. The operational performance has been excellent. And I reflect on safety, I reflect on employee engagement. These are things that I regard as some of the truest measures of how well our business is run. We've substantially expanded our manufacturing capability. I reflect and think about how diversified our customer and geographic footprint has been. And all the while, we've been delivering award-winning innovation. So that's something to be very positive about. Revenue from outside ANZ has gone from nothing to 18% of the group, and I'm proud of what this team have been able to do in terms of taking the sort of industrial conglomerate to now what is an automotive pure play in automotive has become. But more relevant today is what's in place. So we've got a clear strategy. We've got a strong leadership team. We had Aaron joined us less than 2 years ago, our Chief Strategy Officer -- joined us less than 2 years ago. We've refreshed the Board as well, which is fantastic. And we've got solid operating disciplines that are running through the business. And as you've just seen, we've got a good set of results in the context of the market we're currently operating in with strong performance across that balanced scorecard. So it's precisely because Amotiv was in that position, it's the right time for an orderly leadership transition. The business is well positioned to deliver the next phase of growth and value creation for shareholders. In terms of process and timing, you can read the details, but I'll continue in the role because we want to have essentially the gold standard of CEO succession, and that's been a real prime objective. I'll be here to the end of the calendar year and then put in a consultancy approach to make sure that we have essentially almost 11 months of transition all the way through to the end of June next year, like I say, sort of supporting the gold standard transition of current business initiatives to ultimately a new Managing Director and Chief Executive. As I said, the Board have commenced a global search and they'll update the market once that appointment is made. But between now and then, my focus is unchanged. I'll continue to lead the business, delivering the priorities and outcomes that I've spoken about in terms of people, customers and shareholders. So that's the full picture. And if you think about it, we've delivered our guidance against a challenging backdrop with some really, I think, strong results. And now we're initiating an orderly CEO transition from what I think is a very strong foundation. So I want to just finish on that, remind the listeners of that strong foundation and also the strong FY '26 results. Before we go back to the moderator, I just want to do one last thing, which is to say thank you to the Amotiv team who worked really, really hard for Aaron and I and the Board in delivering those FY '26 results. So with that, I will pass back to moderator, and we'll take some questions.

[Operator Instructions] Your first phone question comes from Tim Plumbe from UBS.

Congratulations on getting the number, particularly against that challenging fourth quarter. And Graeme, all the best on your next endeavors. Just I'm sure there'll be loads of questions, so I'll keep it to 2, if possible. The first one, and apologies if I missed this, but steel pricing looks to be up quite materially on the spot market. You've also got some Thai baht tailwinds. And I know that you've mentioned some pricing increases in the first half of '27. Can you give us a sense for what sort of steel cost uplift you're anticipating in FY '27, and maybe how we should think about the quantum of the pricing increases that are required to kind of offset that impact? And then the second question is just kind of around the Aussie consumer and any change that you've seen there into the first quarter of '27 in terms of basket size trading down, et cetera, compared to FY '26? Like is it just a continuation of that same subdued Aussie? Or has it taken a little bit of a step down?

Well, let's unpack the 2 questions. We've seen some pretty extreme steel price increases in the last 3, 6 months, approaching the 30% mark. I won't be that exact for commercial reasons. And that's obviously difficult to deal with. We are right now offshoring as much as we can in terms of domestic production for our 4-wheel drive. So that's one action. Obviously, we've taken cost out of the business. That's another action. And yes, we're in the midst of out-of-cycle OEM pricing and also pricing for our aftermarket. I won't talk specifically to the pricing actions in terms of the quantum because, again, that's commercially sensitive. But fundamentally, Aaron and I and Jason recognize parking the margin for one second because the margins obviously dropped. The return on the capital employed on that division is not where it needs to be. And we're taking all manner of actions to ensure that it does improve as part of the runway to getting to 15% at an overall group level. So I'm not trying to be too evasive in some of my answer there, Tim, only because it's so commercially sensitive, but we are taking the actions, and we believe that we will improve both the ROCE and the margin. You'll see the exit margin has improved in the second half for that division. So that's how I'd characterize that first situation. And like everything, like any manufacturing business in Australia, particularly Australian presence, we're facing an inflationary environment beyond just your input costs in terms of steel. We're talking about rent. We're talking about wage inflation. We're Victorian-based. So you have got other things that roll through there. So it's a difficult thing to wrangle, but we have confidence that we will improve it. Then turning to your second question. We're not seeing any material change in the consumer in the first start of Q1. It's a difficult thing to decipher. July is all over the place, frankly. But we're not really seeing any change in the consumer behavior that we saw at the end of the Q4. It's still muted. If you think about Powertrain, we're still seeing workshop bookings in a similar sort of vein. You've seen the new vehicle sales come through in July, but those will move around sometimes due to deliveries. You're seeing some outsized performance in BEVs, ships arriving. So that's not a good read at this point. And then if I think about LPE, much the same. So I'd characterize the consumer position to be very similar as we go through, but that's domestic. And yet, we've seen some improvement in ANZ, and we are expecting and seeing decent consumer activity as it pertains to us in our U.S. and European markets.

Your next question comes from Mitchell Sonogan from Macquarie.

Graeme, yes, congratulations, and it's been good working with the last 8 years. So I hope you find a lot more time for getting into soccer again, mate. Maybe just numble few trips over to Asia there. Maybe just on the outlook, you've talked to modest revenue and underlying EBITA growth. Obviously, can you give us any sense of what you consider modest? But also just in terms of first half, second half skew, you've got a little bit of commentary on the outlook statement there about pricing benefits to skew towards second half. So yes, just at a high level, how should we be thinking about first half, second half skew in that guidance as well?

Well, thanks for the kind wishes, Mitch, and the football will continue. That's for sure. And 8 years, by the time I actually finish my connection with Amotiv, it will be closer to 9 years. It's a long time. So that's a bit a long and durable time, I must say. Look, the comment around modest, we're not putting a number to that, Mitch. We've said in the past, modest could be anywhere between 0 and 2 to 3. That's the language we probably use, but that's probably a little bit pliable. It is hard, and you'd expect us not to come out and be as definitive as we felt we were last year because so much has changed in terms of the Middle East. So we're being a little bit more guarded. We do expect growth on the back of a number of physicals. So what we're expecting out of the U.S. and what we're expecting in terms of some of the market share and penetration and domestic PTU and things like that. So that's certainly true, but we're not going to give a number. And then secondly, in terms of pricing, look, we just -- it's just physicals. Some of the pricing -- and you can see some of the exit rates, you can do the back solve, you can see some of the exit rates, whether it be gross margin, there will be underlying to sales and then you take it down to the division, you can see the exit rates improved in the second half on the basis of some of the things we spoke about in terms of second half pricing in FY '26 and the like. And we'll see a repeat of that this year. So that's why we made the comment. I don't want to lead too much into that. The pricing is in place or in the process of being put in place, but it's back-end weighted given the time we have and the notice periods that we're required to give certain customers, and that's the basis of the comment.

Okay. Second one, just in terms of the 4-wheel drive and I guess the comments around the new vehicle sales remaining soft. Yes, can you maybe just give us a little bit more color on how you're seeing some of the key models out there? And you obviously get a little bit of visibility in the forward pipeline with where you are in the supply chain. So yes, just keen to understand how you're seeing that, noting that you've done incredible work on getting on to a lot of the Chinese OEMs that are coming into the country as well.

Well, thanks for that back end of the comment because we're super pleased at how well Jason and the team have been able to get the market coverage. So our position is not dropping away. This is not a story about market share or any of those types of things. The team -- it's through a whole lot of hard work, by the way, we haven't -- you'll see in the deck later on in the appendices that we're having to work really hard and expand the level of product development energy to make sure we can keep pace with all those Chinese. But all those ticks are a great testimony to us covering the market. So that's a good thing to dwell on. But if you think about the full year, Ford was down 5%, Toyota down 7%, D-MAX probably about 10%. I think BT was probably 13%. Nissan maybe close to 40%. I mean, basically, the market was down in terms of pickups, 4 of the top 5 were down materially. You saw what was happening with BYD. So net of that was down 3%, but you saw a lot of mix roll through there, and that's sort of how the year finished. We're not planning to see a material change in that at all. We're trying to make our planning assumptions and be cautious as we sit and think about that. So we don't believe that we'll see much change. We do think that we'll see some of the Chinese OEM pickup mix move around a little bit because you've got some Chinese pickups recently launched or launching and that will move some share around. But fortunately, we've got supply relationships with all and they're all customers. So we're expecting to see perhaps some of the share traded around a little bit, but we're in a good position in that regard. But at the end of the day, we're not expecting the market to bounce back. And that's important to have as a planning assumption because it drives our attention on other actions that we need to take to ultimately improve the ROCE and the returns on that particular division and the overall. And that's why I spoke early on around some of the offshoring, utilizing the manufacturing asset in terms of Keysborough. So we're moving Cruisemaster down there. When I say offshore, I'm talking about taking whatever we're doing domestically here and doing as much as we can into Thailand. And then the other important factor is, and you can see it later on in the pack, we talk about -- by the time we get to FY '28, we believe that the volume that we've been winning offshore, meaning in Europe and U.S., will actually, in the medium term, outstrip any decline domestically. So that's actually a very positive thing. And I think for the first time, you've seen us to mention the sort of unit volumes we're talking about when I talk to -- and we're pretty broad, 30,000 to 60,000 units in just that European. We've got other opportunities that are in the pipeline that perhaps we'll talk about in the AGM that would further enhance our offshore credentials in terms of towbar sales into different jurisdictions. So that's kind of how we're thinking about the domestic market, but we're kind of also buoyed by what we've been able to do into Europe into U.S. as well, Mitch.

And sorry, just one super quick follow-up. Just in terms of Toyota, they've obviously put out some pretty big statements about expecting to get their market shares back up towards that 20-plus percent over the coming 6 to 9 months. Are you able to give us any color as to what you're seeing in terms of some of those key big models like the Land Cruise or like the Prado and the new Hilux coming through? Any color there would be appreciated.

Look, I mean, I can't comment on Toyota talked to. We know that Toyota are a powerhouse brand in this market. And we also know that any other powerhouse brand, Ford included, also would never sit idly and watch share drip through their fingers. I'm sorry to use such a colloquialism. So I would expect the Toyota, the Ford, the traditional youth providers to be pretty aggressive in their response. They're not going to sit there and watch any OEM, whether it be Mitsi, Nissan or indeed a plethora of Chinese youth coming in, sit there and accept lower market shares. So I would back any of the established OEMs to have a good go at the pickup market. The reality is the pickup market is down a bit, yes, for sure, because of the macro. But even if it was a 230-unit industry instead of a 250-unit, they're all going to fight pretty hard to get their share of it. And at the moment, people are sitting on the sidelines a little bit. And you're seeing a distorted segmentation because there's so many people rushing and buying affordable cars at the moment because of what's going on and people are sitting on the sidelines from a pickup point of view. As people start to switch their attention to pickups because scrappage sits in the background niche, people still have to buy those pickups. There's just more participants there. And so it's just going to get tougher in terms of where the pricing is going to be for those OEMs and they might have to discount a little bit more. But I would back any of the established brands to come out punching to try to get some of their share. So for us, if I take that now to us, we support them all. Our towbars, our nudge bars, our sports bars are sitting on the Toyota's and the Fords and everybody else. So it's important, it's good, it's great. But at the same time, we've got that wonderful market position that sits in the background supporting them all.

Your next question comes from Andrew Hodge from Canaccord Genuity.

Just in terms of the business when you talked about, I guess if we think about some of the elements that are cyclical, and we've talked over the last year or 2 about some of the cyclical downturn, whether you started to view any parts of it, and I'm thinking particularly sort of LPE reseller and the caravan business as to whether it's beyond cyclical and there is some structural element happening with regard to those parts of the business or anything else that you think may have moved from just a cyclical downturn to any kind of structural element?

Well thanks for the question, Andrew. As it stands at the moment, we would still consider it to be cyclical. I think if I tick through the major areas of cyclicality, so obviously, we've just covered off new vehicle sales. And at the end of the day, there's some forecast information, third-party forecast information that sits in the appendices that talks about where we think -- where others think that new vehicle sales will be, where they think the segmentation of pickups and -- sorry, pickups and SUVs will be. And you can see in the medium and the long run, there's definite cyclicality as it stands today, okay? The mix of Chinese within that, we've just covered off. So that kind of covers off the cyclicality around new vehicles. Then you got to buses and trucks. We know that they are at an all-time low. So you think about LPE, your comment there, trucks. When you talk about PACCAR, whether you talk about Volvo, whether you talk about any of the domestic manufacturing, they're all at very low ebbs at this point in terms of jobs per day. That can't go on forever. Trucks need replacing by dint of them wearing out, and this is a very large continent. So we're definitely that's cyclical. You could extend that to buses as well. And then you go to the parts of RV and caravan, which is the last part of your question. The only thing I would say there, Andrew, is the distinction between where the caravans and RVs are being built. And I think that's changing. So the volume of imported caravans/RVs, I think there's a structural change happening there compared to the number of being manufactured domestically. Yes, the aggregate number is cyclically low. But I think as that comes back because people are still wanting domestic tourism, there's still grey nomads and all those sorts of things going on. I think the split between domestic and imported will change a little bit. Now for us, we've established a Chinese base, and we're actually morphing that right now. So we have an Asian sourcing office. We have presence up there that, to a degree, has a sales engineering capability, and we're about to upgrade that. And what we're finding is that the Chinese RV and caravan manufacturers want Australian brands in those vans. And so we have more than $10 million of revenue sitting in what we call China to China programs, where we're actually putting our brands into Chinese products that then find their way down here. And so our job is just to make sure that we maintain the penetration we've already got up in China if that structural change was to persist. So hopefully, that gave you a bit of a flavor, Andrew, as to your question.

Your next question comes from Sam Teeger from Citi.

Graeme, all the best going forward. 8 years is an impressive skin for a CEO these days. Can we explore the ECB divestment in a bit more detail? Anything you can elaborate on as why you saw limited growth potential in the business?

Well, look, I'll give you a quick answer and then I'll hand to Aaron. We've got a business there that originally we were going to bring down into Keysborough. So that's the first part of the decision that led to a divestment. And then the second part was the growth trajectory. And at the moment, as you know, we've been very disciplined with our capital allocation. And so we were presented with a choice as to how we wanted to spend money. There was going to be a cost to bring down to Keysborough to occupy that concrete. And we knew from a demand point of view, this is facing into the same cyclical elements and also the aftermarket, and we're making choices where we want to deploy the capital, and we'd rather bring down Cruisemaster at a quicker pace and also some other subscale manufacturing that we have, which we're not disclosing today, where we'll actually continue to utilize concrete down in Keysborough. So those were the 2 sort of factors that drove us to the decision. I know, Aaron, perhaps you want to add a little bit more to that.

Sam, I won't repeat what Graeme has said, but this business was not growing. We didn't see it being able to generate meaningful growth in the future. Its margins were under pressure, and there was also -- there was a capital mitigation story here. So even if we didn't choose to migrate what was an inefficient manufacturing operation from Brisbane to Melbourne, we would have had to invest meaningful amounts of capital into that business. And when you consider that against a backdrop of a business that we didn't see growth going for -- going forward on as well as purely being a domestically focused business up against a lot of also privately owned businesses competing in the same space, you don't have the same sort of capital return requirements as we do. We felt it was a better decision for the shareholder to divest that business, recycle the capital and put it to work into other parts of that business where the returns and the growth are going to be better.