ARB Corporation Limited (ARB) Earnings Call Transcript & Summary

Okay. Good morning, everyone. It's just turned 9:30, an economy of shareholders is present. So I'm therefore pleased to formally declare this 40th Annual General Meeting of ARB Corporation Limited open, and to welcome you all. It's nice to see so many familiar faces. Is it sound okay the back, everyone can hear me, okay? Excellent. My name is Robert Fraser, and I'll be chairing today's meeting of our company. I also extend a warm welcome -- who are viewing and listening to today's meeting via the online webcast. I'd first like to introduce your company directors. We switched the order a bit this year. Second to my right is Founder and Managing Director, Andy Brown, an independent Non-Executive Director and Chairman of the Audit and Risk Committee, Karen Phin. Next to Karen is Non-Executive Director and Chairman of the Remuneration Committee, a founder, Roger Brown. To Rogers right is independent Non-Executive Director and industry store -- Andy Scott, and Andy is retiring, as you would have seen or would have concluded from the notice of an Andy is retiring at the conclusion of the meeting. And then at the far right is independent Non-Executive Director, Adrian Fitzpatrick. Unfortunately, independent Nonexecutive Director showing a favor is unable to attend today for family medical reasons, and she sends her apologies, but she will be listing online. I'm also particularly pleased to welcome [ Ian Faston ] here today. Ian, if you could stand, thank you. Ian has been nominated by the Board for election at this meeting as an independent Nonexecutive Director and will be addressing the meeting later. Also in attendance today are our senior management team and the company's Chief Executive Officer, to my immediate right, Lachlan McCann, our Chief Financial Officer and Company Secretary, Damon Page; and Director of Manufacturing and Engineering, Dennis Horton. Thank you, Dennis. We've also got representatives from Deloitte Australia, in particular, our new audit partner, Paul Schneider. Thank you, Paul; and Client Director, [ Brian Wilson ]. Welcome, Paul and Brian. And then finally, from Computershare, we've got representatives there as well, Peter Renda. At the back, I think you become part of the furniture at these meetings, Peter. And as always, it's a delight to have a former long-term director, John Forsyth with us today, thank you, John. At the conclusion of the meeting, there will of course be an opportunity for you join the Board with some light refreshments and talk to us after the meeting. The notice of Annual General Reading has been made available to all shareholders, unless there are any objections, I'll take the notice as read. And I'll just now take a moment to outline the agenda for this morning. We'll commence with management presentations, which we normally do from the 3 senior executives, Damon Page, Dennis Horton and Lachlan McCann. I'll then open the floor to questions and comments. And subject to time, we'll try to cover as many of these as possible for efficiency. We have included in the presentation materials responses to any of the questions that we've received before today's meeting, which we always encourage if you do have questions. Once we've concluded the comments and questions, we'll then turn to the formal items of business, where we'll consider the receipt of the company's financial statements and reports and there are 3 resolutions on today's agenda. First, the adoption of the company's 2026 remuneration report. The reelection of Roger Brown as a Non-Executive Director and the election of Ian Foster as a new Nonexecutive Independent Director. The minutes from last year's meeting are available for inspection by contacting the Company Secretary. That was the meeting held on the 16th of October 2025. And the other formality is just the disclaimer, which Ben, I'll get -- or I was doing these slides to put on the screen, that's the formal disclaimer regarding any forward-looking statements. Thank you. That either I or the other directors or senior executives will be making today, you'll appreciate that any statements we make are obviously subject to uncertainty in there. Therefore, there's the formal disclaimer which you can see on the screen. We'll now turn to the management presentations and the company's performance for the year ended 30 June 2026 or FY '26, as I'll refer to it. The demanding macro climate and the challenges in the Australian market landscape that were evident at last financial year, unfortunately persisted into FY '26. New vehicle sales were affected by vehicle availability. Together with intense pressure on discretionary consumer spending. Despite this backdrop, ARB's Australian aftermarket sales were less impacted than our industry-wide -- another industry-wide declines. ARB's international sales offices delivered very mixed results, reflecting dramatic geopolitical changes in key export markets. Nonetheless, international export sales achieved growth, and they remain a core pillar of our expansion plans. Sales in particular in the U.S., continued their positive momentum and total export sales for FY '26 accounted for approximately 38% of our total sales revenue, which was very near to a record. ARB's business to the original equipment manufacturers or OEMs, as we call them, was the most significantly impacted segment, and this was due to the cyclical timing of new OEM platform releases, which constrained the supply of key vehicles. Overall, while the Board was frustrated that we did not achieve profit growth in FY '26, the results do reflect the resilience of AOB's core business in the face of these very challenging market conditions. Moreover, ARB avoided the asset write-downs, the excess debt, the restructurings and resets elsewhere in the Australian industry and seen overseas. We've been consistent in our business management and are backing long-term organic growth through our strategy of growing ARB's global product range, our distribution reach and our brand strength. The Board held total fully franked ordinary dividends for FY '26 steady at $0.69 per share, with a final dividend fully franked of $0.35 per share that will be paid next Friday on the 23rd of October. In terms of the future, we remain steadfast to ARB's core values of driving excellence with passion. We are very deliberate in responding to a changing car park and our planning and decision-making focus remains on strategically positioning ARB for the longer term rather than reacting to short-term pressures. 4-wheel drive vehicles will continue to require the accessories that AIB manufactures regardless of where they come from or how they are powered. And our priority is to ensure that ARB has the best accessories for the best vehicles. On behalf of the Board, I would like to thank our global workforce our senior management team and all staff and thank you to our shareholders for your continued investment in ARB throughout what was a very challenging year. The management presentations, which will follow, will highlight the strength stability and deep experience of the senior management team, which I believe are key competitive advantages. Damon Page, ARB's CFO and Company Secretary, will be the first to present and he will cover the financial highlights for FY '26. Following Dennis will be following Damon will be Dennis Horton, who's our Director of Manufacturing and Engineering to discuss these critical areas, together with ARB's ongoing investment, and we are increasing our investment in engineering and research and development. which is the backbone to the future of our company. To conclude, our CEO, Lachlan McCann, will cover all other operational matters and finish with an update on the company's first quarter trading and outlook. Lachlan's presentation will outline a clear and deliberate product-led strategy for ARB's future growth. Our strategy is to increase investment in engineering, manufacturing and marketing, with the objective of accelerating the volume, speed and quality of new product releases, both domestically and overseas. Today's presentation will highlight the early benefits of these investments and the opportunities they create for our long-term growth. Our presenters, Damon, Dennis and Lachlan are all long-term employees of with whom I'm sure you're familiar, having them presented at previous meetings, summary details of their backgrounds are on the screen, and they are available in the presentation. So I won't elaborate further on those in the interest of time. However, in short, between Damon, Dennis and Lachlan has 66 years of experience at ARB. And the strength of this management team, I believe, has led to a very successful transition of the executive team from its founders while maintaining the very essence of AIB's corporate culture. With that is now with great pleasure that I would invite Damon Page to commence the presentation. Thank you, Damon.

Great. Thank you, Robert, and good morning, ladies and gentlemen. It's wonderful to be with you. A warm welcome to our shareholders and business partners and guests that are joining us today. and also to those who are participating via the webcast. I'm pleased to present a review of the key financial outcomes for the financial year ended 30 June 2026. ARB delivered sales revenue of $702 million and profit after tax of $92.4 million during a challenging trading environment. sales revenue on the left-hand side of the graph there declined by 3.8% compared with FY '25. While this result was below the record sales achieved in the previous year, it was achieved in challenging circumstances in challenging economic and geopolitical environment and consolidates the significant step change in sales revenue over a few years ago. The main factors influencing revenue during the year were softer new vehicle sales in a number of our key markets, particularly here in Australia and continued pressure on discretionary consumer spending around the world. Most notably, sales to OEM customers reduced significantly during the year, declining by 27.2%, reflecting lower vehicle sales and model-specific program timing. I'll speak to the sales performance by channel in a later slide. Our sales have grown by an average of 7% compound average over the last 10 years. Turning to profitability in the center of the page. Profit after tax was $92.4 million, a decrease of 5.2% on the prior year. the decline in overall profit was essentially a result of lower sales volumes, noting the 3.8% decline in sales. Significantly, while earnings were lower than FY '25, ARB maintained historically strong margins despite a weaker Australian dollar and U.S. import tariffs throughout the financial year. with gross margins and operating expenses relatively comparable to the prior year. Profit after tax, excluding one-off transactions related to capital gains on property sales and a positive fair value adjustment of the Mitt alloy contingent consideration and prior year transaction costs related to acquisitions declined by 7.5%. Profit after tax has grown at an average compound rate of 6.9% over the last 10 years. broadly in line with the growth in sales. Importantly, the shape of the result improved as the year progressed which I'll talk to on the next slide. Now to the right of the slide, the Board's policy has been to maintain a dividend payout ratio of between 40% to 60%. And more recently at the higher end of this range. Accordingly, dividends paid have generally tracked in line with profits made over the last 10 years. The fully franked interim and final dividends paid and announced in relation to FY '26 was $0.69 per share, consistent with the prior year. Last year, the company announced and subsequently paid a special fully franked dividend of $0.50 per share. Noting it had been 10 years since the previous special dividend indicating that special dividends are not necessarily the rule. The final dividend for FY '26 of $0.35 per share will be paid to all shareholders on Friday of next week all dividends, including the special dividend were funded out of cash reserves. And the take-up on the dividend reinvestment plan remains around 15%. Overall, while FY '26 presented a number of external challenges, ARB remained profitable, cash generative and well positioned to capitalize on future opportunities across both domestic and international markets. Slide 8 provides a comparison of first half and second half performance, highlighting the improvement in earnings momentum as the year progressed. Looking first at the first half, underlying profit before tax was $58 million, and this represented a decline of 16.3% on the corresponding period last year. As discussed at the half year results release, this reduction in profit was primarily attributable to 2 factors. The first was the weaker Australian dollar relative to the Thai bar which adversely affected margins given the significance of ARB's manufacturing and distribution operations in Thailand. The second was the impact of factory overhead recoveries with the prior comparative period, benefiting from increased manufacture and inventory levels that resulted in a higher recovery of fixed manufacturing overheads. Despite these headwinds, net operating expenses were maintained at $143 million, broadly in line with the prior period. reflecting disciplined cost management in what remains an inflationary operating environments. Turning to the second half. In the middle of the slide, underlying profit before tax improved to $60.7 million and was down only 4.3% on the prior corresponding period. This stronger performance was driven by a recovery in gross margins as the Australian dollar strengthened against the Thai batt and returned to levels more consistent with the previous year. Net operating expenses in the second half worth $142.7 million, an increase of 2.8%, reflecting normal annual wage adjustments, together with additional costs associated with supply chain and freight disruptions arising from ongoing tensions in the Middle East. On a statutory basis, profit before tax for the second half was $65.9 million an increase of 1.9% on the prior corresponding period. This represented a substantial improvement on the first half result, where reported profit before tax declined by 18.8%. On the next slide, the company generated cash flows from operations of $103.7 million. The business continued to demonstrate strong cash generation during the year. Cash flow from operating activities of $103.7 million was broadly in line with profit after tax of $92.4 million after taking into account depreciation and the impact of foreign exchange movements. Working capital movements were relatively contained with trade debtors down $7.7 million inventory up $6.1 million and trade payables up $2.8 million. Now cash flow from operations essentially funds capital investments and dividends to shareholders. The company invested $36.6 million in property, plant and equipment with $24 million spent on property and $12.6 million spent on plant and equipment. Major capital items acquired during the year included the new powder coating line in Thailand, which Dennis will speak to very shortly and the continued rollout of the retail flagship stores. I spoke to dividends as part of the first slide, but note again that fully franked interim and final dividends have been maintained at $0.69 per share and the payment of a $0.50 dividend in relation to '25 was paid during the '26 financial year as well. All dividends were fully franked. The company had $47.9 million in cash at the end of the financial year and had no debt. and net cash reduced by $21.3 million during the year, essentially attributable to the payment of the special dividend. This particular slide refers to the 3 sales channels that we typically report on, being sales into the Australian aftermarket sales into export markets and sales to the original equipment manufacturers. Sales into the Australian aftermarket declined by 3.3% to $390 million with sales of ARB's key Australian vehicle platforms down a little more at 4%. Results were mixed across the domestic sales channels with the dealer and fleet channels, most significantly impacted by the lower new vehicles delivered into Australia. The challenging consumer markets and constraints on discretionary consumer spending also weighed on the results. The Australian aftermarket represented 55.6% of total sales, broadly in line with FY '25. Export sales grew to $268.4 million and represented 38.2% of total group sales, marginally up from the 36.6% reported in the year prior. The stronger Australian dollar in the second half of FY '26 resulted in a lower translation of export sales into Australian dollars. The Americas achieved growth of 10.2% despite difficult trading conditions, including ongoing tariffs, while the U.K. was materially impacted by lower new vehicle registrations and trading conditions in both New Zealand and the Middle East remained challenging. Sales revenue to OEMs in Australia only were $43.4 million and declined 27.2% and now represents 6.2% of the group sales. down from 8.2% last year. The decline in sales to OEMs is attributable to the timing of new contracts with the prior year benefiting from new contracts initiated in FY '25. Lower new vehicle deliveries in the second half of FY '25 also impacted on OEM sales with increased new vehicle deliveries expected through 2026 -- through FY 2027. Thank you for your attention. I'll pass the time on to Dennis.

Good morning, and welcome to everyone in the room and to those who are listening remotely. It's my pleasure to be presenting to you today on manufacturing and engineering at ARB during FY '26. And importantly, I'll kick off with an update on safety. It's an area that we're heavily focused on and continually improving. Last year, we added energy to our global safety teams with key resources added in Australia and Thailand giving our safety team greater capacity to drive safety initiatives. We added a safety management system called Safety Champion and kicked that off with pilot programs in key locations. The safety management system gives us a number of advantages, including the collection and management of data and greater depth and breadth in our safety reporting. We also completed Phase 1 of a structured program to update our domestic forklift fleet. Safety performance is our priority, and we've seen another solid decrease in our total time loss frequency rate. We're focused heavily on lead indicators taking priority over lag indicators. [ Nemis ] reporting is a good example of a lead indicator that is being prioritized. We're seeing the reporting increasing, and we expect that to continue improvement with the recent implementation of safety Champion, which makes the process so much simpler. We increased the number of safety training modules that are mandatory for our employees, and we've also seen a positive increase in the completion rates. Moving on to engineering. One of our core strengths lies in engineering capability and capacity. We've worked on refining the structure of our engineering teams in Australia and Thailand to optimize the resources that we have available to us. We've relocated and expanded the U.S. engineering team, adding capability and capacity through new hires and providing an increased footprint for new product development. Our engineering leadership teams have been strengthened with key new hires, and we have materially expanded our engineering teams globally and the U.S. team has been an important part of that growth. As a result of these changes, we increased the volume of new product development compared to FY '25. Our engineering leadership team has been putting energy into the development of our people and also robust systems to ensure we have solid foundations for continued growth. We're not done yet, and we're continuing on our growth phase with more recruitment planned and some already underway. So manufacturing is also at the core of ARB strengths. And as you are no doubt aware, it forms a significant portion of our operations with factories in Australia, New Zealand and Thailand. One of our core strategies is to be vertically integrated. In-house manufacturing gives us control of quality, volumes, timing, supply chain, materials and various other advantages. With this in mind, in collaboration with the Nacho team, we have developed capability to manufacture lighting at our Thailand factory. So we've installed a dedicated climate control manufacturing facility. We've begun supplying natural lights globally from our factory in Thailand. We've established a robust supply chain that is heavily weighted towards Thailand suppliers. There's already a well-established lighting industry in Thailand. Everything we've worked on today can be expanded and scaled as required to take on other lighting projects. And we now have a solid team of people between ARB and Nitro with excellent lighting expertise. Roll draw manufacturing has also been established in-house to support our vertical integration strategy, a market-leading draw system design and manufactured by ARB with all manufacturing methods and tooling designed by ARB. There has been investment in new capital equipment, including processes that are also new to us. Around $4 million has been invested in this project to date. The product has been rigorously tested to ensure suitability for harsh off-road conditions with production preparations during quarter 4 of FY '26 and production commencing during this current quarter. Manufacturing capability and capacity has seen continued investment and our new coating facility in Thailand is a good example of that with around $16 million of investment, it's a high-capacity advanced coating loan that allows us to discontinue outsourcing of coating. The line consumes around 6,000 square meters of space at our factory 4 in Thailand. With improved surface treatments and the addition of electro deposited paint, the new coating line will improve product quality and provide Tier 1 OEM level corrosion protection for both OEM and aftermarket products. The line has automated powder coating technology, highly efficient paint transfer and best practice paint reclaim technology. We've also installed leading-edge in-line automated coding thickness measurement equipment. Our current Thailand capacity is extended by 2 to 3x with this installation. The line is designed for our low-volume, high-complexity product mix Installation is being completed now in this current quarter and production commences on the new line in quarter 3 of FY '27. Thank you for your attention to continue and finalize our presentation, I will hand over to our CEO, Mr. Lachlan McCann.

Thank you very much, Dennis, and good morning, folks. Lovely to have you all here, and welcome to this year's AGM. As Rob noted, financial year 2026 was a frustrating year for a number of reasons. While external factors played a part, our leadership team has remained focused. That's a -- okay. Our leadership team has remained focused on what we can control and on positioning ARB to capture the opportunities that emerge in such a challenging environment. Today, I'll outline those key areas of focus. Before turning to the Australian aftermarket, we'll show you a short video from the Melbourne 4x4 show. At this event, and other major 4x4 shows around Australia, ARB takes a prominent position to showcase our complete offering. Engage with thousands of customers over 4 days and gather really valuable market insights. We'll play the video. I think most of the people in the room are Melbourne-based, if haven't made it out to Flemington to attend the show I really recommend you to. Okay. Let's start and take a look at Australian vehicle sales and those vehicles core to ARB's business. The new financial year has begun with many of the same vehicle supply challenges that affected us in financial year 2. Sales of ARB core vehicle platforms and the broader 4x4 market were down 16% in the first quarter of the financial year '27 compared with the prior corresponding period. Importantly, more than half of that decline relates to nonsupply issues affecting Ford and Toyota rather than a broad deterioration in demand. Ranger volumes were impacted by the airbag recall during August and September, while selected Hilux variances were affected by a recent stop sell. These issues are expected to be resolved in the short term. Despite the disruption, Ford Ranger and Toyota Hilux remain the dominant platforms sold in Australian pickup market. Ranger reclaimed its position as Australia's top selling vehicle in September, which highlights the underlying resilience and demand for the largest platform in Australia. The Toyota Prado and BYD Shark both recorded strong growth in the quarter, while volumes of the very important land crews of 70 series remained heavily constrained. Toyota continues to forecast a strong finish to the 2026 calendar year. And although that improvement has not yet flowed through to the domestic market, we expect it imminently. As previously communicated, ARB's Australian recovery remains closely linked to improved Toyota volumes. We remain confident in the underlying demand for the right 4 platforms, but the timing of that recovery will definitely depend on vehicle availability. ARB store network now comprises of 80 stores nationally. ARBs 4x4 accessories require specialist knowledge, specialist facilities and specialist skills to sell and install our product. and to deliver on our brand promise, ARB customers expect a premium experience in store. We have built the best fab for specialty aftermarket distribution network in Australia, and we are confidently driving expansion of this proven formula. In financial year '26, we completed 2 flagship upgrades and 3 new flagship sites. Clear evidence of our confidence and the confidence of the network in the future of AB is the 3,527 square meter flagship store in Townsville, Queensland, the newest and the largest store in Australia. Congratulations and thank you to Mike and Kylie Elliott on the opening of their new Townsville store. And I think there's a couple of us headed up to Townsville to join and Mark and celebrating the opening of that store. A significant step this year was the establishment of our first dedicated fleet fitment center in Auburn, New South Wales, extending our specialist model to the growing fleet channel. Fleet represents a healthy portion of ARB's Australian sales, and this new center in Auburn provides a seamless one-stop shop solution for our fleet customers. We have a long list of independents wanting to invest in future stores alongside a strong pipeline of our own new developments. And on to a new initiative that I alluded to in the year-end result presentation. The next phase of our Australian network expansion is the ARB Preferred Partner Program. A new 2027 financial year initiative developed in response to strong demand from independent regional operators seeking closer alignment with ARB. The program enables specialists 4x4 businesses to deliver ARB flagship experience at a budget that meets the size of the local market opportunity. It has been developed with our regional stockers and is open to both new and existing partners with the right product knowledge, fitment capability and customer service standards. So hopefully, there's a call out to those great businesses in regional areas. If you fit those categories, we look forward to hearing from you. The model allows for each business to retain its local identity while adopting the ARB customer experience. Partners receive a strong product access, launch support demand generation and e-commerce, click and cotabi.com.au as well as access to fleet and licensed accessory opportunities. The Cara site shown here on the screen is the first completed preferred partner location. A reminder that it is a new initiative. To further sites are in progress, and there are 5 in final review with the target this year in the financial year '27 of 22 sites to be complete. This is a capital-efficient way for Bt extends our national coverage, particularly in regional markets, while protecting the specialist capability and the premium customer service that differentiates our network. On the wet commerce. And during the last financial year, ARB migrated its Australian website to a state-of-the-art integrated Adobe e-commerce platform. The site delivers a seamless customer experience supporting customer journey by product or by vehicle, providing a single source of product information, price, pricing, purchasing and the use of an integrated database to guarantee accessory suitability. It is a true omnichannel offering with direct click and collect, online quoting requests all directly integrated to our private store network and inventory management. And it's really important to point out the integration of that independent network was primary and a really challenging task to overcome, but we have integrated that whole independent network into this program. Importantly, it gives us great insights to our customers with detailed analytics on our customer experience, which products and which platforms they're searching for, which drive smarter decision-making on marketing and product development across the business. The transition has been a success. ARB has maintained its position as the #1 visited 4x4 accessory website in Australia, nearly twice as many customers now use the site to find their local store or stock is, and we're seeing early strong growth in direct-to-consumer sales. We have a strong pipeline of enhancements underway for the website with international expansion to follow. Today, I'm delighted to announce that Ford and ARB have agreed to extend our multiyear agreement through to 2031. This is only just hot off the press, and it didn't make the presentation, but we got some final information through overnight. And so very pleased to announce the extension of that program. Work has already commenced on the new product design and engineering for the 2028 model Ford Ranger, which is a facelift. This is the most successful OEM accessory program of its kind globally. And this extension of the contract is an endorsement of a partnership and a positive outcome for both Ford and ARB. ARB's relationship with Ford continues to broaden across 3 important pillars: build, thrill and adventure. With build ARB Metalli accredited through the Ford Pro converter program, supported by the largest network of improved converters in Australia. This extends our capability into integrated vehicle solution for business and fleet customers. We're thrilled ARB's involvement in Ford's Motorsport demonstrates the capability of our products in domaining operating environments and reinforce the performance credentials of the brand. And I think Andy branded the Dako 1000 in a Ford Ranger and he's still shaking as a result of it. And within Adventure ARB continues to provide an extensive range through the Ford license accessory program. The breadth of the range means that ARB is exceptionally well positioned to provide Ford customers with a genuine one-stop shop solution. RB's future with Ford is bright, with opportunities, including the expansion of the program through our new South African business, we are confident this business will continue to grow. We'll now move on to international. ARB is a global brand, and we continue to invest in our brand and product marketing to be locally relevant in all parts of the world. Despite the current geopolitical issues, the Middle East is a focus region where we swap pickups driving through mountains and rivers to a proper marketing focus of Sand Dunes and large SUVs. [Presentation] Unfortunately, not many people are heading over to the Middle East at the moment for recreation, but it is a fantastic part of the world. Okay. ARB's export business recorded a net increase of 0.5% in FY '2026 in a challenging international environment now represents 38.2% of the business. The U.S. was again a major growth region, with sales growth through wholesale, our parts and RW networks, e-commerce and other channels, all delivering growth despite economic and tariff headwinds. Asia was the other strong contributor to this financial year, partially offsetting declines in the U.K. and the Middle East and New Zealand. The strong Australian dollar in the second half also reduced the translated value of export sales in Australian dollar terms. On to some emerging markets. ARB China, a wholly owned subsidiary, commenced operations in May with local and Australian dignitaries attending an official opening, establishing a local presence is a major step in the growth of our business in China and the recognition of this as a key future market for the business. Initial demand has been strong, and we continue to see month-on-month growth. Our presence in China also provides a foundation for a strengthening relationship with local OEMs. And being important to Chinese OEMs in Australia is important to us, but a larger opportunity is to become important to those manufacturers in the home market. Similarly, Africa represents an opportunity similar to Australia where high overall 4x4 vehicle sales are very, very strong. Today, we do have lower accessory attachment rates in South Africa, which remains the opportunity. We have more than 30 years of heritage as a premium brand in Africa, supported by local customers, established distribution partners and vehicle platforms that largely mirror Australia. We now have our own direct in-market wholesale operations in South Africa, along with the team. We took possession of a warehouse in [ Guang ] last month. And our first -- sorry, Paul, I've got the pronunciation right now. Okay. We had our first containers arriving we have begun invoicing. And I'm not sure if all of you are aware, but South Africa is a build location for a lot of the pickup. So the Ford Ranger, the [ Hilo ], the DMAX are all actually manufactured on a CKD basis in Africa for the rest of the African market and largely are also the export location for the European market. We continue to work with our established distribution partners while improving local availability, strengthening the brand and building on positive engagement with local OEMs, particularly Ford, as we previously mentioned or I previously mentioned. We are targeting a meaningful step change in African sales over the short term. We now move to our U.S. business. Despite the ongoing economic and political challenges faced in U.S. Maker, ARB recorded growth in U.S. dollars of 13.5%, which I think is outstanding in this environment. All channels performed well, including the wholesale business buoyed by the RW 4 parts relationship, Latin America e-commerce and the OE business through TSA. Poison Spot has performed well in the first year after relaunch with demand at stripping supply and a strong inventory pipeline now positioning the brand for ongoing growth. Our U.S. engineering center is now fully operational and continuing to scale with additional engineers and new equipment supporting local prototyping and product development. This brings development closer to the market and is accelerating our expansion for U.S. pickup bed products or hubs, as we would call them here. We've recently released at Tacoma Canopy in the United States. And later in the presentation, you will see our cane forward. And later in the presentation, we've got a number of examples on a product basis, where you'll see this strategy coming to life. Our joint venture with Off-Road warehouse and 4 parts continues to go from strength to strength we've achieved high double-digit growth in ARB sell-through driven primarily by increased sales of ARB accessories included in the expanded range from our engineering teams. And the business continues to operate profitably. The ARB store in store rollout is progressing well with 8 stores completed to date and a further 22 stores being worked on now. And we remain on track for a full rollout of those ARB store in store across 47 stores in 9 states. Our new [ fpart.com ], Adobe driven e-commerce website is now live and the cutover was a great success. We're planning to transition 4 parts to a focused premium retail aligned with the RV brand experience from financial year 2028, and we'll continue to grow ARB product availability across the network. I know there's a couple of people in the room heading over to the U.S.A. shortly for sema. So hopefully, you get to jump into one of the full part stores. We now move on to our original equipment business. Sales to OEMs were $43.4 million in FY '26, down 27% on financial year 2025 and presented a 6.2% of group sales. Please note this does exclude sales to OE customers outside Australia. But to reflect the jerky nature of our sales later in the presentation, I'll go through the Q1 result, which has swung back the other way, fortunately. Importantly, this decline was cyclical, driven by a lull between major vehicle programs and constrained supply in key vehicles rather than any change in AIB's competitive position. We have not lost any OEM contracts or any specific product fitments. A partial recovery emerged in the second half of the year and Toyota have announced materially improved vehicle supply in the first half of FY 2027s on models called to our OE business, which will drive further recoveries. Now on the 50th year journey, as we previously mentioned, we had insights from employees, customers and industry leaders that we're a touch by today. I just wanted to provide a quick bridged version of a couple of statements by Harry Wagner, who's a bit of an off-road icon in the U.S., who tells a story about his AV experience. [Presentation] And that is a breach version of about a 3-minute spiel that he gives. It's really worth watching. It is on YouTube, go and have a look at it. It's the U.S. 50th year trip. Okay. Now Rob alluded to our product strategy and products remain the foundation of ARBs success. And our focus is on using the competitive advantage built over many years to deliver more innovative products on more vehicles in more markets. This slide addresses ARB's key sustainable competitive advantage, again, being product. And their core competencies that the business has built over time to make us a sustainably better to make us sustainably better than our competition, control higher margins, but importantly, to support our vision of future growth. ARB is an incredibly vertically integrated company, which makes us a more complicated company, but it does provide depth and breadth. And that's hard to replicate across 6 competencies that ultimately support our product-first strategy. Our globally recognized premium brand, ARB, is instantly recognized by customers, giving them confidence across diverse categories, which allows us to accelerate adoption of both new and established products. Our investment in global infrastructure for distribution of ARB products gives us the ability to access customers quickly through specialist retail, wholesale, e-commerce and OEM channels across multiple markets. Our scaled engineering team combines highly specialized knowledge with OEM level capabilities. Working alongside our manufacturing operations, the team can develop integrated solutions with speed, quality and flexibility demanded by both aftermarket and OEM customers. our manufacturing capability, as Dennis had mentioned, allows us to invest in innovation, intellectual property and process that are difficult for our competitors to match. Our people reputation continues to attract talent from within the industry and from broader market professionals. And finally, ARB's profitability, cash position and debt-free balance sheet gives us the capability to fund these opportunities for substantial long-term growth. As Rob noted, ARB is a product-first company. We have committed to increased product investments across engineering, manufacturing and marketing to support sustainable growth in both revenue and profit. And now we'll have a look at some of those examples. This slide demonstrates the breadth and cadence of our current vehicle development program across established leaders in important emerging platforms. For the BYD Shark, we've made commitment to develop a full line of products for this vehicle, and we've delivered. Additional marketing spend is being made on the platform. And while the sales slide. And whilst the sales results are slower than traditional Ford Ranger and Hilux customers, we are executing on this strategy. and we are focused to being relevant to this new buyer. For the Ford Range Super Duty, we were the first to market with a comprehensive range and further products, including the [ Asan Canapi ] an air lockers are coming soon. The attachment rate for accessories on this vehicle have been higher than we've previously seen on any other model, reinforcing the value of prioritizing the right vehicle platforms. We bought the NY 63 petrol across from the Middle East. This vehicle is not available yet in Australia to enable early development ahead of its local launch in Australia and also, of course, to be quick to market in the Middle East for this popular platform. This vehicle has been on despite the various 4x4 shows nationally and has been incredibly well received, including newly styled Sahara XBAR. And consistent with our relationship of more than 4 years with Toyota, ARB has worked with Toyota Motor Asia, as previously presented on an official accessory lineup for the new mini FJ Cruiser in multiple international markets. We've now also bought this vehicle across to Australia, and we are currently developing aftermarket accessories for it. today showcasing some of those investments out of the engineering resource in the U.S.A. We have and are producing a stronger pipeline of products designed specifically for the world's largest truck market. At Seaman November, ARB will debut the ranch of style protection bar for full-size trucks beginning with the Ford F250. This bar was developed in consultation with a number of dealership groups, ranch owners and other F250 ownership groups, mainly focused in Texas to ensure we hit the brief of the market on this product. This will be -- this F250 will be at SEMA and will also feature the Mitali, which is going to go on debut the show at Sema. We also but an F-150 asset canopy bringing ARB's color-coded OE level canopy design to the world's #1 selling truck. And it's important to note, we are a significant player in the back of pickup bed space in Australia, but this strategy is reasonably new to us in the U.S. and represents a significant growth category. The U.S.A. has recently announced the release of the Forge up control arms to improve suspension geometry handling durability on lifted trucks and to complement our Omani suspension rate and probably reflects a little bit of the Californian style dressed-up vehicle. In addition to which the team also will debut at seen in the full-size truck lift kit, initially on the F250, 350, including the first MT 64 suspension, fit with a remote reservoir. These are important steps in repositioning ARB and BMU more strongly in the high-valued U.S. full-size truck market. Our product growth is not limited to vehicle-specific protection and suspension. We're also investing in substantial new categories and renewing important ranges. The new GT Earth Camp reflects a significant investment in the platform, incorporating customer feedback to substantial upgrades across comfort, functionality, durability and self-sufficiency. ARB is launching a completely redesigned roller drill platform, as Dennis mentioned, design, engineered and manufactured in-house. The new system introduces updated styling, electronic release locking multiple configurations and deeper integration with ARB's canopy and touring products. For IP reasons, we can't show the image of the new draw, but it's a cracker, and it will be released at SEMA. ARB's first winch is a significant expansion of our recovery portfolio. It has been designed for a modern vehicle integration and to complement ARB's protection and recovery products while opening a substantial category for the brand. We're also launching the next-generation elements fridge freezer with updated styling, simple operation, app-based control, improved transportation hinges and a bunch of other features, including dual zone configurations. And again, this product will be at SEMA. Okay. We're wrapping up shortly. So on to the Q1 FY 2027 update. Sales declined 6.1%. The single-digit declines in the Australian aftermarket and Nexo markets were partially offset by strong growth to our Australian OEM customers. Notwithstanding the decline in revenue, unaudited profit before tax grew in the quarter, as sales margins remained resilient and continued to trend in line with the overall result achieved in FY 2026. The stronger Australian dollar against the Thai Bart was beneficial, although this was partially offset by factory overhead recoveries, resulting in softer sales from the factory. Australian aftermarket revenue was also affected by several temporary issues, the mounting bracket recall on the 90 Hilux Bulbar affected field fixed activity, the Ford Ranger airbag recall and the recent stop sale, as mentioned on the Toyota Hilux variance. While the sales reflect a challenging start to year, the growth in profit before tax demonstrates the resilience of ARB's margin and operating model. ARB's aftermarket business performed ahead of new vehicle sales in the first quarter, responded challenging economic and supply environments. Fleet and Forward license accessory businesses continued to outperform and our corporate retail stores delivered strong growth, while independent stores, dealerships and our wholesale business were slower. For the balance of FY 2027, we will pursue a more aggressive product first marketing program to convert the significant pipeline of new vehicle applications and broader product launches into sales. Export performance remains mixed. Africa, Europe and Southeast Asia achieved growth while vehicle supply continues to affect the U.K. and demand in the New Zealand market. The U.S. aftermarket business continued to deliver strong growth in the first quarter. This was offset by declines in U.S. OE sales as current contracts mature, but the strategic foundations we have established continue to support positive to medium-term outlook. Early sales to the Australian OEM customers show strong signs of recovery, which we expect to continue based on OEM projections for those key platforms mentioned, we have also secured new OEM contracts, including in the United States, in the United States, sorry, which we expect to commence in FY 2028. The Thai bar is hedged through February 2027 at rates that compare favorably with the prior year. So in summary, the Board believes Abe is well positioned for long-term success through continued expansion of the Australia and New Zealand aftermarket, strategic OEM partnerships a growing export business supported by a U.S. distribution and a strong balance sheet with $47.9 million of cash and no debt as of June 30, 2026. We are backing these advantages with increased investment in engineering, manufacturing and a substantial product pipeline and a well-balanced management team, combining long-standing AOB experience with new executives to the business. Before finishing, I'd like to thank the team at ARB for their continued efforts and commitment to the business. 2026 was a tough year to test of the business, but the resilience and the results are occurred to the people across every market and every function. We remain ambitious about our continued growth and are excited about the product first execution strategy. And on behalf of the management team, I'd really like to congratulate and thank Andrew to for his contributions to over more than 20 years and certainly welcome to Ian today as well. Thank you. I'll now hand the presentation back to Rob.

Thank you, Lachlan. I know there's a lot of preparation and thought goes into the information that we provide to shareholders, which I'm sure you appreciate. We certainly still do have challenges to navigate. And I note that an entire presentation, the words diesel prices were not mentioned once, but they're certainly not helping either, but we are in very good shape for the long term. So I'd like to thank all of the Board and our shareholders, on behalf of all the Board and the shareholders, I'd like to thank Lachlan and the senior management team for your leadership. We've now got some time for presentations. We're making good time, so -- for the questions on the presentations. Hopefully, we've covered most of the pressing questions that you might have. But please, we'd welcome any other matters. If the questions relate to the agenda items to come later, such as the remuneration report or the election of directors, if you could just hold those over until those items. There will be plenty of time before we vote on those. And please be reminded that only shareholders and proxy holders, and so that's those people with a yellow or a blue voting card may address the meeting. If you could just raise your hand if you have any questions and state your name and if relevant, the organization that you're representing. And of course, in the interest of time, if you could keep your question in '16, that would be appreciated. Who would like to kick off the questions please? Yes. Sorry. Who's got the microphone? Are we just getting that? Thank you yes. line others good. Sorry about that.

That's all right. Ray Tollison long-term shareholder and a member of Team Invest. Yes, I'm not speaking on behalf of Teves, but just some questions interested in a bit more detail about the South African move? Are there actual stores envisaged? Or how is the product to be got to markets?

Yes. It's -- thank you for the question. South Africa we've been President in South Africa, as mentioned, for over 30 years. Our distribution partner for that period of time is a company called 4x4 megawatt and they have 22 stores across South Africa. They have a retail business to run, and we have a brand to grow and develop. We will continue to work and partner with them, but we need to invest ourselves in -- our own brand development, particularly in South Africa, but surrounding sub-Saharan markets as well. We monitor the performance of those markets relative to the vehicle population. And it's our belief there's further growth and opportunity for expansion. And I suppose the comment about the vehicle manufacturing on our CKD basis in South Africa really makes it a hub where we should be seeing high levels of sales and growth. And so we're taking that responsibility on ourselves. The relationship with both for Mega world is fantastic. We have the guys out here for a week recently. They're aligned with the strategy, and we're pushing hard. On recent visits, we also identified that our pricing wasn't probably where it needed to be. And so we have worked with our South African distribution partner to realign at a lower level. the market pricing of a number of our accessories, which we think is going to help fuel future growth. So I hope that answers the question.

Yes. So you're not envisaging opening actual ARB stores.

No, not at this early stage. And certainly, the partnership with Ford is a cornerstone of this as well because they've asked us to step in be a part of the relationship. They've seen the success of the FLA program in Australia and Ford South Africa desperately once that's delivered by us in the local market.

And just one more about China. Presumably not expecting to sell much actual product in China?

No, absolutely.

I just don't know enough about China.

It's been -- to give it context, it's been -- I won't give you specific numbers, but it's been -- and still is a multimillion dollar market for us. So -- and the brand is particularly strong. We have worked with distribution partners in China, which comes with its own complex and challenges. And again, we're taking the responsibility. Jason and Lilly, we've had a couple of staff members in China now for the best part of 5 years. We've grown that team to a team of 5. And their outset, they're acting as wholesale developers. We've engaged warehousing. We're putting the product in there and ourselves, obviously, we've incorporated locally. And so again, we're controlling our destiny. We've got a little marketing team, and we're putting the brand out there in the Chinese environment a lot more strongly. And in a short amount of time, you'll see a more Chinese focused product strategy. to make sure that we're attending to that consumer the right way.

I might just add to that. As Lachlan said, without revealing any numbers, certainly our business 5 years ago in China was materially higher. So there's definitely opportunity there, and it certainly gives us presence in that market to develop product. With respect to South Africa, I should also -- I just wanted to mention that, that is -- I mean it is a very big market, and it's not something -- this opportunity that we've taken is not the first one that we've looked at. We have been looking at this market for quite some time, and we felt that this one was the best opportunity, but we did explore various avenues to get into the market but we're very happy with the one that we've now arranged.

It's Stephen Mayne. There's a lot of private equity activity in the market at the moment, Cleanaway, Reliance worldwide a whole range of them. Are we ready if someone comes knocking, -- have we got a defense adviser on the books? And have we heard any noise.

I think the best way to be ready, Stephen, is to increase our profitability. I mean, as corporate adviser myself with a long background in merchants and takeovers acutely aware of perhaps the vulnerability that we've had. We've probably been protected from it in previous years when the PE ratio is significantly higher to some extent, we probably still are because our PE relative to other automotive companies around the world that have had major debt issues or restructurings. We don't have that. But we're certainly aware that we need to perform as the best way to the best defense that we can have. But no, we haven't engaged a formal adviser.

Have you all aimed it at all in terms of how you would react and how you play it?

We've certainly got advisers that we have spoken to in relation to various corporate matters. So I won't go into specific details, but there are certainly people that follow ARB that are really in regular contact with us that we could engage with if we needed to a short notice.

Okay. Now last year, there was a nearly 20% vote against your reelection. What was that all about? And have there been any similar material against boats today?

Certainly, look, I covered that last year, Stephen. It was mostly in relation to perceived overboarding which for anyone that knows me would realize that, that's a pretty unfair comment because my Board is an absolute priority, and I give it everything and I certainly wouldn't take on a board unless I had the time and make make it a great priority and a commitment. But since that period, I've relinquished my Chairmanship of Bengalla Asset Management. That was 18 months ago. And to be perfect honest, that was taking up more time than any of the boards that I've been on. And my executive role within Taylor Collison has been scaling down over the years, and we'll continue to do so. So I think that's been addressed. As to -- has there been any similar sort of protest vote. I think that's sort of what it was last year. The answer is no. I think you'll see the proxies later. So perhaps I'll disclose those. I think the proxy is because we -- as a good practice, we disclose those proxy figures before shareholders vote anyway. But I think Ian is at 93%, and Roger's at 87% that are off the top of my head. So I don't think we've had the same level of protest vote.

Just the last question. I'm not sure come back to have another later. Over the long journey for the brands, have you ever been -- this is Andrew and Roger, have you ever been on the opposite sides of a nonunanimous vote in the Board. Has there ever been a nonunanimous vote in the Board overall?

Could you sit down, Stephen, please that's enough, okay? You've had your turn. I've watched you at other meeting last June. Just sit there.

I'll take that the I'll take the question. Well, Roger has answered the question. The answer is no, there has never been -- that's absolutely not to say that there aren't very vigorous debates and discussions around the boardroom table. But once the decision is taken, I think you've strongly supported decision, and that's what we do as a Board. So just -- I'm just inquiring on the challenging culture within the Board, that's all. I'm not inquiring on that? Or that's all right. I think -- look, I think that -- Steven, that's been -- I think that -- I think I've answered that. I said we have very vigorous discussions even between individuals. So I think as we've just seen, it must be very difficult disagreeing with the brown that's an observation. I wouldn't agree with that observation real -- but you're certainly entitled to it. There's no issue. And I have no issue with you asking the question. Any other -- I'm sure there are other questions.

Hello. My name is Peter Calero. And I've -- from the Aussie Broadband Board. I got to ask a question, which I think was asked 7 years ago, and I think it's time to revisit the question. Now I'm aware of the hybrid BYD Shark. But my question is with the increase in electric vehicle demand, have you noticed any change? Or are we prepared for the increase in electric vehicle? And my second part of the question sometime in the future, there will be more self-driving cars. Are we prepared for that situation?

Yes. Great question, and I'm very happy to answer that one. Our strong belief having partnered with various OEMs, including Rivian, which is the North American electric vehicle manufacturer, including Ford on a number of electrical platforms, including Toyota on some of their electric platforms. we do take great guidance from OEMs because they spend a lot of money researching these areas and have capital allocated that we don't see. And their strong view is that people don't stop recreating because they drive one version of a vehicle, whether it's -- or another version of the vehicle or it's electric. Now some accessories, snakes, long-run shield tanks, they're going to struggle to sell on electric vehicle, but we certainly think that there's it is going to create a huge amount of opportunity for us to innovate on electric vehicles and provide probably accessories that we don't do today. And a strong acknowledgment of that question comes in the form of Ben Tustin joining the Board. We want to get deeper insights into the volume of work, the OEM spend on how customers are going to use their vehicles over the next 10 years. And we confidently invest in engineering to differentiate ourselves to make sure we've got the right product platform. So that's a more of a detailed answer. But to simplify it down. We genuinely believe that people irrespective of drivetrain type will want to continue to go and visit the outdoors and drive beyond in Australia and internationally.

Okay. Just one other question in this part. ARB without question is a premium brand. It's a premium product. One of the issues that in some industries, premium products have found is counterfeit goods. Are we actually having an issue with that? Or are we prepared if we see a rise in that?

Yes. I don't have the numbers at hand. Damon probably quickly grab our legal costs as a business over recent times. But we spend a great amount of time and effort, including monthly meetings with our IP lawyers. And we do look across the world. We have definitely got companies out there looking to replicate our products, and we defend our position rigorously. We spend a lot more time in understanding the best ways that we protect our IP as well. And it's a really complicated area. It's not just about, okay, we've got an innovation pattern or we've got a design registration. You actually have to understand the detail about how to best protect that in every market around the world. So it is a very strong area of focus. And certainly, for us, where we spend in excess of $20 million per year on engineering and innovating, we have to be able to protect it, so absolutely. I'll cut back to you, Steve. I'm happy to take the question. Is there any other ones or any other questions? Stephen, please feel free.

I'll stay seated at this time. Just a question on AGM process. I was hoping to go to 4 AGMs today. AI, Treasury Wines, Cogstate all having hybrids in Melbourne. And obviously, you're having a dinosaur physical meeting with no ability for online questions. Just wondering if you'd be able to make a commitment to allow for online written questions next year. You've got everything set up. You're doing the webcast, you're hiring the speakers, you hired the room. It's not as if there's not actually a big cost difference in just bolting on online questions. So I'd just like to ask if you could actually make that commitment for next year.

I won't make that commitment that we will hold in that format, but I will make the commitment that we will consider it. And I don't mean to file off the question. We actually do consider it very carefully every year. if there are 4 AGMs, all on the one, not sure they're having a hybrid would allow you to..

You can't -- have to -- but if the turn up means you can't go to a whole bunch of other meetings today.

All right. We look at it absolutely every year. We continue to think that is the most appropriate format. You can say that we're a dinosaur but that means there are a lot of dinosaurs or still in Australia because, as you know, not all companies on that format. In fact, there's still a significant -- still significant format of them. just if I could just add some if I could just answer the question, Sean. I think just recently, we did extend the coverage. I know it doesn't necessarily help you in terms of your online questioning, but we extended the coverage right way through the meeting rather than just do the actual formal presentations we put it through. And we also -- I mean, we encourage I said in my address earlier, we encourage shareholders to send any questions before the meeting. If you have genuine questions, we can include them in the presentation and responses or write to you directly. This year, we've also appointed Ben Mitchell Ben down the front here as an Investor Relations manager. So we've significantly increased the accessibility of the company to investors. We didn't have that previously. So we've engaged that resource -- and of course, it does allow to maximize the time and the room for people to ask your questions. And as you said, there is an additional cost involved, so you could debate the benefit. But I know you're not the only one with that view. ASA has expressed that for you. I'm a member of the ASA. So I understand their position poorly. But what I can commit is that we will review it again next year and every year in the future.

I go to see the site fact was the in the situation. You did mention a lot of other companies don't do it. I've actually nominated for close to 50 boards in the last 6 weeks and 25 companies so far have negotiated a withdrawal of the nomination by adding online questions. I didn't do it to AI because I love you and you're a great company. I don't want to -- not you. But -- everyone is moving. Yes. I don't want to do that next year. I just think it would be great if you could offer it -- and final general question.

We'll speak offline.

Yes, sure.

You make the point and say that it's a point that's shared by a lot of pipe...

Final general question is, as I've asked this many times of directors. So it's Andrew Scott's final -- it's always good for shareholders to have access to some exit reflections from to parting independent directors. So I'm wondering if Andrew could just share with us what he regards is maybe the best 2 decisions that he thinks that ARB has made during his long journey on the Board. And if he had his time again, would -- should ARB done anything differently? Like does he have any regrets after his long experience representing us independent shareholders?

Why don't you take that offline? Put the question to Andrew and Andy, I think he's quite happy to chat afterwards about that. But yes, and its decline to comment on that question I can only say that he's been a tremendous a tremendous resource. And I will say a few words a little bit later. His industry knowledge is exceptional and his involvement with ARB goes to committing weeks on and setting up race events is the first at the track is the last out, taking ARB banners and other things and promoting the company and the product and the industry and our contacts. So in terms of -- apart from Andy Brown, how means more involved in the industry and the for were driving community than anyone on this board. So he's going to be sadly less missed, but I think if Andy feels he would rather keep those reflections private. I think that's I respect that for you. Any other questions? Okay. If there are no further questions, we'll move to the formal part of the business, and I said there'll be plenty of time to ask questions on each of these resolutions. We've received proxies up until 9:30 a.m. on Tuesday, which is the 13th. That was the cutoff of proxies and we'll show a slide with each of the proxies for each of the resolutions. In my capacity as Chairman, I intend to vote all available proxies for all 3 resolutions in favor of the resolution, subject, of course, to the voting exclusions. The constitution of the company, together with the Corps Act provides that a resolution put to the vote at a general meeting shall be decided on a show of hands unless a poll is demanded. A poll can be demanded by the Chairman and then that capacity I am requiring that each of the 3 resolutions today be decided by way of a poll, and that's also in accordance with our corporate governance statement. So I now declare the poll open. In order for your vote to count, you will need to complete your yellow voting card and then place it in one of the ballot boxes, which will circulate at the end of the 3 resolutions around the room. And shareholders who wish to vote should, of course, mark the relevant 4 against or abstain boxes in relation to each of the resolutions on the voting card. Abstentions will not be taken into account in computing the required majority for the pole. If you are a proxy holder, you must comply with the direction of the shareholder appointing you, and I hereby appoint Peter Renda from Computershare as the returning officer to conduct this poll. Please let me or Peter know if you have any difficulty completing the card and we'd be happy to assist. We'll arrange after this meaning for the votes to be counted, and the results will be lodged with ASX and of course, on our company website as is our usual practice. I'll only close the poll, as I said, once there's been plenty of time for discussion on the votes tallied. The results of each resolution will be released to ASX later, as I said. All right. The first resolution -- it's not actually -- it's a resolution. It's just to consider the adoption of the company's financial report, together with the directors' report, the independent auditor's report for the first year, the consolidated sustainability report or for the financial year ending 30th of June 2026. No resolution is required in relation to this agenda item. However, those reports are open for discussion. Does anyone have any questions on the accounts and also Paul Schneider from our water -- our new audit partner from Deloitte, is present to answer any questions. Stephen.

So it's the first year for the sustainability report. We can hear from Paul as to what percentage of his time on the overall audit was spent on the sustainability report. You heard from -- I think it was Origin yesterday -- this is obviously a first in the market. And I'd be interested in hearing from you Chair as to what the board discussion was like. You're hearing some feedback that lawyers and sometimes conservative directors trying to reduce the amount of stuff going in there. So how rigorous was the debate within the Board about how extensive is the disclosure to be in the first-ever sustainability report. Do you think it's been a useful process. And again, from the auditors as to how detailed and involved the process was for the first time.

Certainly, we're aware of the requirements coming in. I think one of the things that streamline the process was the fact that we were aware that it was coming in and we were well prepared. So we hit the ground running at the beginning of last financial year. so that we -- it wasn't going to be a big task to collect the data. There is people we're not going to individualize it, but put up their hand to take on extra responsibilities in getting the preparation of the report done. That came under the Audit Committee, and we get actively involved in it. So we didn't find -- the process was very time-consuming, but certainly first Scope 1 and Scope 2 is relatively straightforward. I'm looking forward to hearing Paul's answer because I hope that he says it's a very large percentage of his time based on the cost to the company. But I'll ask Paul to address that.

Thank you, Stephen, for the question. I think if we look at it reflectively over the whole period, we spent about 15% of our time was focused on the sustainability report. I think it's important to call out that the required vigor around how we perform an external audit is slightly different to the requirements for limited assurance. So accordingly, 15% roughly is the time that we spent on sustainability report.

Okay. I'll now turn to the items of business for curing a formal vote. Each of the 3 resolutions on which we'll be voting was in the notice of meeting and will appear on the screen as we consider each resolution. So I'll take the resolution as read. As I noted previously, I'll be voting all undirected proxies or available proxies in favor of the 3 resolutions. Resolution 1 concerns the company's remuneration report, which forms part of the director's report contained within the annual report for good corporate governance. I advise that the remuneration report of the 2025 AGM of the company was carried with a vote in favor of that resolution of 98.57%. The Board genomes recommends that shareholders vote in favor of Resolution 1. Before I open the floor to questions, I'd like to address the proxy position for this resolution. As displayed on the screen behind me, the proxies received ahead of today's vote indicate that more than 25% of the votes cast are against the adoption of the remuneration report. Consequently, if the final poll reflects these proxies, the company will incur what's known as a first strike under the Corporations Act.

Okay. Thank you. Although the vote on this resolution is advisory only and does not bind the company or its directors, we certainly take the results of and feedback in relation to this resolution into account when setting the company's remuneration policies. I want to state clearly that the Board acknowledges and respects this feedback. We take our obligation to align executive pay with shareholder wealth very seriously. And indeed, given that the board collectively are substantial shareholders that goes without saying. The company's remuneration structure was designed in good faith to meet the specific needs of the company during this vital period of management transition from a founder-led business. Moreover, the senior leadership team have been tireless in their efforts over the past few years in the face of very difficult market conditions. We have engaged with stakeholders over some years to explain this approach, and we have benchmarked the remuneration outcomes. It should also be noted that ARB's remuneration philosophy and framework have been in place for some time. and there were no material changes from last year when the proxies received were almost 99% in favor. In these circumstances, we certainly understand that the vote reflects broader investor frustration regarding our share price performance and remuneration alignment, particularly this last financial year. Nonetheless, we generally respect and appreciate the feedback we've received during our engagements with shareholders and hear the message clearly. We have received detailed feedback, and the Board will be reviewing all aspects of the remuneration framework. We are fully committed to addressing this feedback transparently, and we will outline the specific actions that we are going to take to ensure we do not receive a second strike. In the meantime, we're going to remain focused on improving the company's financial performance, which ultimately drives shareholder outcomes. With that background, I would like to invite any questions or comments from shareholders on the remuneration report. I'll take you -- thank you.

Mike Middleton, Australian Shareholders Association, I am the ASA's monitor for this company. It relates to the remuneration increase for the CEO. After listening to the CEO's performance, I can see that he justifies his salary well, and he's obviously very enthusiastic. But we do have an issue with retail shareholders. retail shareholders are struggling as many of the community at the moment. And it's difficult for some of them to grasp how 3 years of profit loss or diminution of shareholder return, can justify any form of increase. And we asked whether the Board would consider this aspect when reviewing the remuneration for next year.

Yes. Thank you, Mike, and also appreciate the feedback that we've had over the 12 months for you and other matters. The answer is absolutely yes. Okay. The environment, as you've noted, over the last couple of years, it's -- this is some of the where the difficulty in redoes come into play during the COVID period. I mean our profits pretty much doubled overnight. And this last year, they've retreated. And yet when I look at the effort that the management team have put in comparing those 2 periods and the stresses and the challenges, it's not reflective. It's one of the reasons why we've probably push back on STIs for instance, the lack of an STI, which is one of the factors that probably contributes to that proxy position. But we will be looking at that. We did benchmark before deciding on that salary increase. We did benchmark. There was -- about 1/3 of companies gave no increase at all. But the average increase was slightly above the increase that we gave and given the effort that was involved, we felt that, that was appropriate. But I certainly hear the pain as a shareholder have experienced that myself and acutely aware of it. But I said, Mike, thank you for the feedback. That will be absolutely taken into account. And thank you also for the other comments you've made during the year.

Paul Peter again now. Just a simple feedback. I noticed you've got the results in 2 columns, the number of votes and the number of shareholders, which is great. But my mathematics isn't that good thing to figure in ahead. Is it possible to have a third column of the percentage of votes in future? So if it gets closer to 25% mark, I can easily see it rather than trying to figure it out in my head.

Yes, sure. I think, Damon, I think it's -- that's 41% -- is it that percentage? But yes, take that on board. I'm not sure if the format is exactly the same as previously or not, but we're certainly happy to do that. The announcement that will go into the ASX today, I should state -- will not only have the proxies, it will have the votes from the floor, and it will be expressed in percentage terms, although you won't have the number of shareholders, it will just be a percentage, but thank you for the comment. Stephen?

Just a process question first. Are the browns excluded from voting on the rem report?