Astral Foods Limited (ARL) Earnings Call Transcript & Summary

Welcome to everybody. Thanks for your time and thank you for taking interest in Astral. As Marlize said, a big swing from year-to-year and I think there's going to be a lot of focus and questions with regard to that, but you have to see it in context. We will try and explain this as well as we can. And if not, during the Q&A we will try and address your questions as best as we can. Just a quick agenda. I'll do the business overview; Gary, operational industry matters. Dries will try to do the financial overview. I'll do a quick view on the outlook and then there's time for Q&A, as Marlize explained to you. Then closing words from our Chairman. And then as you know, there's a lot of additional information in the back of your presentations that's been put on our website, information we used over a number of years to better explain how to look at our business. The key financial indicators, fortunately, for me, all green -- the arrows. The arrows are all green. From a revenue perspective, always important for me, if you look at the revenue history, you have to create increase in the revenue or turnover. And again, this is testimony over many, many years that we have been in a position to continuously grow top line. That, of course, if you go into the detail of the presentation later, is based a lot on both volumes sold and price. So it's a combination of the 2. The profit before interest and tax at ZAR 1.1 billion, last year, a loss of ZAR 620 million. So a swing. And if you count back 1 or 2 funnies, a swing of close on ZAR 2 billion on year-to-year. And I think that's the achievement and what can be done in any organization. The profit for the period, up 247%. Headline earnings up 245%, and Dries will dwell into the detail of that. Then I think the most important factor for us, the focus point during the past year was to look at the debt levels and the overdraft, something we're not used to and something we do not like as a highly volatile high-risk industry, no debt. So during the past year of F '23, we burned ZAR 700 million of cash and additional ZAR 1.1 billion in overdraft. That has all been pulled back. And as we stand here at this very moment today, we have no debt on our balance sheet. So 0 debt. And that's been a major achievement and was also the focus over the past year. And then, of course, for those of you that always ask about the dividend, it was well debated at Board level, and we looked at the affordability. And at the end of the day, for our loyal shareholders, we decided that we can afford to pay a dividend without going into the red again in the near future. That dividend will only flow at the end of January. So that's the key indicators. The salient points that drove what was behind the key indicators is, first of all, and this is in a specific order, the broiler day-old chick cost increased year-on-year following the contingency measures mitigated -- to mitigate the impact of bird flu. So 2 things happened. There was a number of actions. One of the key ones, we had to keep our breeding stock that was still healthy and alive longer to get fertile eggs. And of course, the older the chickens are or the breeding stock are the worst the hatchability. So that's additional cost. You have to feed the bird but you don't get optimized hatchability from that. And then, of course, importation of fertile eggs, mainly from South America at additional cost, almost double the cost that what we produce it here. And that is why the -- it's a bit of a hangover into this year, the day-old chick cost increase. Poultry feeding costs decreased. And it reduced levels of feed. Remember, in the big bird era, we had the birds from time to time up to 50 days old where we normally slaughtered at approximately 33 days. So you had to feed those birds. And in mid-June last year, we rectified that situation, part of our turnaround plan, and we had to -- we were now in a position to use less feed because the birds are at the right weight at the right age. Therefore, the broiler live cost decreased. That is now approximately [ Anthony] 65% of total cost. It was as high as 70% at one point in time of your total cost. And a lot of focus on this and Gary will quickly speak to you about the raw material situation and the soft commodities. I think one of the positive things that came out of the turnaround plan is we tried to turn everything upside down in the company and relook at it and see where we can improve. And if you don't farm right, you can't be in this business. So if you look at the key statistics on our farming performance a bit later on, you will see that after that program and after the bad year, our current year's results is almost all at record high. So the potential of the bird is being farmed well. And then of course the big benefit to us and to the industry, no reported incidents of bird flu during our past reporting period. We had to cut back on our broiler placements. You all know the consumer is under stress, not in a good situation, unemployment, discretionary disposable income under pressure and we just adapted our production according to what -- how we rate the market. And the positive thing about that is now we now have spare capacity. So any uptick in the market from the consumer or consumption point of view we can easily place up those birds now and as if they've been paid off long time ago. What was a quote yesterday from one of the reporters? Money for nothing and chicks for free. So that's actually what it means is it's been paid for spare capacity. You don't have to expand or spend any CapEx. So that's a positive for us. Our poultry sales volumes increased. Now it looks a bit funny because we cut back, but your sales increase. At the end of last year, we ended with quite high closing stock levels, finished goods. 60% of the reduction of the stock was due to selling out of stock. So our stock level is currently in good shape. The poultry selling prices improved year-on-year. The average for F '24 versus F '23 has increased by approximately 5%. But towards the end of the current year, prices started to drop off due to a number of factors. Broiler margins, positive. Last year, it was a negative of close on 10% negative margins on the broilers. And that had to do with the big bird era where we had to put all birds in 5 kilo bags and sell it and discount it. So negative margin last year. This year, net margin of 1.3% on broilers. So it's paper thin. Debt levels cleared. Again, I spoke about that, very positive. At the end of last year, our debt was at ZAR 1.03 billion more or less. It's all been cleared. It's gone, and we're going to pay a dividend. This slide was developed in the height of load shedding to indicate the additional costs the company had to bear. And if you can remember at the time, the yellow indicates additional feed that had to be fed to the big birds. That is gone now. And we also, at the time, said that all that will remain is the red bars, which is additional diesel to run the operations. Last year, the cost of this was close on ZAR 1.7 billion in total. If you look at that part there, ZAR 1.7 billion. This year at ZAR 160 million and all by diesel. So that is the reset and focus program. We cleared that. We're back to where we should be. Now you might ask why do we still have additional diesel here or cost there. And remember, where we operate, it's not just about load shedding. It's also about the infrastructure in towns. So for instance, in Sandton, there's limited electricity from Eskom to the town. If we keep our factories going all day, the town will trip. So in peak consumption period of electricity, we have to run the generators. And that's approximately over the past 6 months, about ZAR 10 million a month. So over the year, ZAR 120 million almost there on additional diesel, which is not supposed to be there. The next slide explains the movement year-on-year. And I'm sure there's going to be a number of questions on this, which Dries can address, especially from the cash perspective. But this is last year's, loss ZAR 620 million. How did we get there? This is the difference. This year a profit, operating profit of ZAR 1.125 billion, a change of [ ZAR 1.75 billion ] swing from year-to-year. And I think that's more the storyline. It's not just the profit or the loss, it's the swing. ZAR 380 million from broiler selling, increase in broiler selling price. I spoke about the 5%. Broiler sales volumes up. However, there's a cutback out of stock, finished goods stocks, contributed ZAR 100 billion. And then broiler raw material costs coming off the average for the year versus the prior year's contribution, positive of ZAR 88 million. Then the reduced feed consumed. Remember the previous slide, the yellow bars. This is the benefit close on ZAR 1 billion, less feed required to feed the big birds. And then the other load shedding cost, the swing between the 2 years, ZAR 250 million, [ ZAR 0.25 billion ]. And then there's a bird flu benefit. Again, the swing -- the cost of this -- this year versus last year, ZAR 81 million. Then there's some insurance recovery of close on ZAR 200 million. That was insurance against bird flu, which is now no longer on the cards. There's no bird flu insurance across the globe. We were one of the last ones. We were audited by external international specialists. And we were almost, I think, the only one on the continent that were deemed with correct biosecurity measures to subscribe to insurance. And then, of course, the 2 red bars pulling the profitability down a bit. There's some personnel incentives there and my golden handshake is mostly about 50% of that Chairman and then all the others combined. And in that, it's the net -- that loss block of ZAR 144 million is the net of your inflationary cost, the profitability from Ross and [ Nat Chicks ], our breeding operations, Africa, and a lot of other things, that's the net of that. So this is a graph that explains the movement between year-on-year. Just a quick graph on broiler net margin and feed price and a lot of people write about this. So we can clearly see that the feed price did come off, as I spoke about earlier and the paper-thin margins in the second half close on 0. I think it's 0.2 Frans and the average for this year at 1.3%. The last year with a loss, both negative. But I think what one should read into this is what is possible. That was a 14% net margin on broilers. And there's some good ones there. If with today's volumes, just imagine today's volumes and the efficiencies of the bird, if you get a 5% margin, 5% to 7% margins on broilers, which I believe is necessary to have a sustainable poultry industry, not just Astral, you can't reinvest with these margins. It's too thin. So just imagine what the profitability of this company will look like if we get close to that kind of margins. 1.3% margin for the half, you make ZAR 1.1 billion profit. So that's a positive. From here, you can only move north and I can say that today. In the next year, it should improve. A lot has been said in the media and by the politicians and the Competition Commission. If you're out there, look very closely to this. Just 2 weeks ago, we read in the media about soaring chicken prices. I don't know where they get their stats from or how they measure it. This is fact, audited fact. This is -- the red line is broiler selling prices over the past, what's it, 6 years, 7 years. And that is the SA food price index. Now remember, chicken is in that index. Look, over the past year of our prices have come off deflationary chicken prices. So people walk into a store and look at a pack and say, "Oh, it's expensive." Then they write a whole article about the soaring price of chicken. It is simply not true. This is fact. So there's no profiteering. And for anybody out there that always want to talk about the chicken price, rather go and look at the margin that we achieve. And we don't achieve a thin margin because of inefficiencies. We are still rated as one of the top 10 most efficient poultry companies in the world. So the margin is thin because of other factors. With that, we get to the slide that a lot of you use these days. This is movement from a specific point in time. The yellow is broiler feed price. So it's a movement month-on-month or year-on-year. So here, you can see how feed prices ticked up and the movement, slightly less upward movement, as we said, feed costs came down. And that is the change in the broiler selling price for a month versus the same month in the prior year. A very positive period there. But look what has happened here. So the inflation has come off to a deflationary point of view. And if we could add October and November, you would see even a further downward trend on the movement of the price, not the price, the movement versus the prior month in the prior year. And the same raw material cost, [ Anthony ], it slowly started to move on the back of a smaller old crop, and there's not enough movement to talk about the new crop. That will only come into play at a later stage. However, this looks negative. I think if you speak to France from as latest last week, 2 weeks, we've seen quite a positive pull-on chicken in the market and things just look slightly better. And somewhere this industry requires a price increase to get out of the red into the black, just to be sustainable, to be there another year or 2. So we will put all efforts in to try and recover our input cost in the market. With that, thank you. I hand over to Gary for the raw material operational review.

Thanks, Chris. Can you hear me okay? Good. Got you. We'll quickly cover this. Chris has already alluded to some of the points over the past year. I think the important thing on this slide and if we look at the balance sheet for maize, reflecting very quickly on the old crop. As we know, the drought, the El Nino that South Africa suffered through -- in early 2024, significant impact on the total maize crop for the country. So we're now trading at the moment a very tight old season crop. Carryout levels 5.4%, possibly the lowest level since they just started keeping data from 1998. So a lot of exports going into the region with crop failure that was experienced both in Zambia and Zimbabwe and other countries. So very tight old crop with pricing at the moment, you'll see on the next slide, trading at about ZAR 1,000 tonne premium to the new crop, next year's maize crop. So looking at that very quickly. We have promising weather conditions, although the rain a little bit late. We have had good coverage across the West and the East over the past 3, 4 weeks. So planting progress has picked up significantly. Yesterday, the planting progress was at 31% against the 5-year average of 36% and last year at 36%. So definitely some progress there in planting and the yields are expected to improve from last year to about 6.1 tonnes per hectare in the new year. That will benefit the crop, obviously, and should lead to a good carryout for the next season. And you can see that pricing in July contracts next year already. This is just the graph where we reflect on the yield. This was the impact of the El Nino in this past summer season and benefiting in the coming growing season from La Nina and better rainfall conditions, producing a 16 million tonne crop. This is what's happened on SAFEX. Anthony, something you watch very closely, I know. I mean, maize is trading at ZAR 4,900 a tonne yesterday on December contract. So definitely trading a massive premium on the old season crop. Yellow maize trading about a ZAR 2,000 a tonne premium on the new season crop. So maize at the moment on old season expensive and we're obviously looking forward to a better crop next year that can relieve some pressure on the South African balance sheet here. Soya meal prices, well, this is a good picture. Internationally, soya meal prices have come off significantly and we have had some assistance through the year with a stronger currency. So if you look at this together with the increasing trend in maize prices, there is still a small advantage to feed price with feed prices coming off based on the combination of the inclusion of maize and soya meal in the broiler feeds. But a good downward trend in soya meal. You can flat price soya meal now at around ZAR 7,500 a tonne. And it wasn't too long ago that you were flat pricing soya at ZAR 13,500 a tonne. So this is certainly a benefit to farming poultry. An overview of the feed division for the year. This division reflecting revenue reducing by 15.2% and the profits reducing by 28.3%. Now this is largely an effect -- mostly an effect of the lower internal volumes that Meadow supplied into our poultry division this year. Last year, the big bird era, we've spoken a lot about that. The birds consumed significant amounts of feed. That feed was all supplied internally. That benefited Meadow's results last year, as you can see here. But it was a massive negative to the group. This year, a more normalized earnings level for Meadow Feeds if you look through the years, you look through the cycle, but certainly, the volume impact reflecting in this year's numbers, not necessarily a bad thing. The rand per tonne margins decreased this year, and that's purely an effect of the volumes again. Last year, the volumes that Meadow produced had the benefit of diluting the fixed cost further which improved the net margin. This year, those volumes aren't there. Still carrying the same fixed costs in the income statement. And you'll see the margin -- rand per tonne margins have decreased slightly. We've spoken about the SAFEX prices for yellow maize and soya meal. This is the big number, 19.5% reduction in internal feed sales. And that is just the swing from not feeding the big birds through last year following load shedding to a normalized broiler production performance this year. And Chris already alluded to the record results, and I'll show those now on the graph. External feed volumes increased through the year. We had some higher sales into the beef and particularly the pork production livestock sectors, started getting some more sales back into the commercial layer or table egg industry as well as biosecurity has returned to those farms and quarantines have been lifted and the risk of bird flu has dissipated. We have slowly gone back to that market. We've had to carefully consider credit risk in that area, but also biosecurity as a major, major consideration in supplying those independent commercial lay farms. Expenses have been well controlled across this division. Expense increases were below inflation, just over 3% for the year in Meadow Feeds. The sales mix, you can see the swing or the return to a more normalized sales mix, close on 60% of the feed sales out of Meadow into the integrated poultry businesses, whereas last year made up 66% of the sales mix. The poultry division, Comercial, consolidated view of the poultry division. Revenue up. That was supported by higher sales realizations, which Chris has spoken of already, but also higher sales volumes. Now, although we cut back in the year, you did see that we have -- or we can see that we have sold more chicken, largely out of stock and then the product mix returning to normal. So as we exited that big bird area where -- era, sorry, where everything was going into a 5-kilo IQF format, and we were short supplying the QSR sectors and the fresh sectors, those volumes have returned into that product mix, which has benefited sales and the sales realization. Margins for the total division, 3.4%. Chris spoke of broiler net margin earlier on of 1.3%. This is the total margin, including the breeder income in this division out of Ross Poultry Breeders and National Chicks. The feed price down by 2.1%. Now if you look at the moves on SAFEX in the year where we had record high feed prices last year, you might expect that percentage to be a bigger number. It's skewed by the feeding program. Last year, we fed a feeding program, which included very low-cost rations. We call them maintenance diets. That was just to keep the birds alive on farm with these big birds that we had off the load shedding. So the year-on-year comparison is slightly skewed by that, but feed price is nonetheless coming down. And Chris has already spoken of the higher day-old chick cost in 2023, which has come about as a consequence of bird flu in 2023. So 2024 impacted by that. Still we imported close on 35 million broiler hatching eggs from Brazil through the year and they came in at a significant cost. We have spoken about the sales volumes increasing. This was supported by a better product mix. But then we also closed the year last year with higher stock levels. So we've reduced our stock levels by approximately 25% for the comparable -- comparative closing periods. And so sales supported by sales out of stock, which was necessary. And the cutbacks that we implemented, obviously supporting that. And that was an effort to better balance our supply with demand in a depressed consumer environment. So you can see through the year, we slaughtered 5.4 million birds a week. In F '22, which was a more normalized year, no impacts, external macroeconomic impacts, we slaughtered just over 5.8 million birds a week. So plenty spare capacity and in this lies a good revenue growth opportunity that can be exploited going forward. So well positioned for any turnaround in the consumer environment. We've spoken about the broiler margins. Operating expenses were lower. Last year, we carried significant costs in diesel and generator costs. Obviously, this year, still cost in the mix. You've seen that earlier on, about ZAR 10 million a month now. And that's just to keep our operations running in a municipal environment. We did have water interruptions again through the year, but about ZAR 14 million lower than the prior year, the cost, but still a significant cost in there at about ZAR 17 million. This is the sales mix. So although we have returned to the fresh value-added and QSR categories this year, you can see those percentages are now off a higher volume base. So about France, 8,000 tonnes improvement in the sales of product into the QSR sector. And that's where we will benefit there from better -- or better margin potential in the value-added QSR sector and again, returning with volumes into the fresh sector. So the product mix back to a more normalized base after the impact of bird flu in the big birds last year. On the bird performances, parent stock sales in Ross, that's Ross Poultry Breeders, we sell parent stock out of Ross. That was disrupted somewhat during the year on the back of bird flu in 2023. A number of broiler breeder farms or customers of ours that were impacted by bird flu either canceled their placements or they moved their placements out. And we had to fall in line with the subsequent quarantine restrictions around their farms. So what this did result in the year is a slight reduction in volumes. Breeder revenue, we had that on an earlier slide that increased. This is primarily on the back of the higher dale chick selling prices driven by the higher hatching egg costs. Importing eggs from Brazil with some of the actions that were taken to produce or get more eggs out of the flocks that remained after bird flu, we extended the age of those flocks. You get the eggs, but you don't necessarily get an egg that is of good quality or fertility and hatchability was impacted as well. So that all comes at a cost and filters into the day-old chick price, hence, breeder revenue in the internal and external sales increasing. We've already spoken about feed input cost decreasing. This was the big one. So about ZAR 1 billion swing in the feed bill year-on-year and you can see that on the next slide with improved feed conversion efficiencies. Our restocking program, we lost in Gauteng and Mpumalanga approximately 80% of our broiler breeders during the bird flu pandemic of 2023. Nationally, 40%. We've restocked everything, so that was completed in a year. And fortunately, as Chris said, no incidents of bird flu in the industry this year. So this is the key one. You can see the broiler performance metrics here. We've said that -- or we've spoken a lot about the impact of load shedding in the prior year. You can see the significant improvement in weight or slaughter age. So I know this is indexed from 2014, but if you look at the history going back, the lowest age that we've slaughtered a broiler at and achieved a live weight of approximately 1.85 kilos. So good performance here from our farming division. Record high PEF for the group. This is over approximately 280 million broilers that have been slaughtered for the year. The impact of load shedding last year on the feed conversion ratio was significant. So in that period, we fed at least 250 grams of feed more for every kilo of live weight gain. And that is a lot of money at the feed prices that we experience today. So certainly, without this and reaching a record low feed conversion or the best feed consumption per kilo live weight gain that we've seen, certainly assisting the live cost of a broiler going into our processing plants. And this is the part Chris mentioned early on, you have to get that right to get your cost base right and feed making up 65% of the live cost of a broiler. So good results from our farming division here. And this was where the focus went straight back to in mid-June last year when we cleared or slaughtered the last big bird. Just very briefly on industry matters, nothing much to say here. You can see that total poultry imports more or less flat on average for our financial year, increasing to 34,232 tonnes. We look at this as a more or less normalized level. You'll see -- you remember in the previous slide, we have in the past seen imports reaching highs of 50,000 to 60,000 tonnes a month. We have a tariff regime in place, antidumping duty against Brazil, a general rate of duty on frozen chicken imports. So the environment or the playing fields have been well leveled where we're not competing with dumped product. And our quarrel has never been with imported chicken but has always been with dumping that took place in the country. Imports still accounting for about 22% of local consumption. And for those of you that remember, Anthony, when we signed the poultry sector master plan, this was about 30%. So there has been some improvement in this space. The import tariff rebate that was spoken a lot about earlier in the year, that was introduced on the back of anticipated shortages in the broiler sector on the broilers with the breeders that were lost last year. That never materialized. I mean, we demonstrated and presented enough data to the DTIC and ITAC that there wouldn't be a shortage of broiler meat. The industry imported broiler hatching eggs. There was 1 quarter where they issued permits for a rebate on those import tariffs. And following further representation, we met with the minister at the time, there were no further import tariff permits issued. This has been in the press quite a bit lately. So we are in the process of working on a submission to treasury to get some chicken products into the Zero VAT basket. And we will be making this submission within the next week. And we believe that this is good for the consumer and certainly will assist people in getting a balanced, affordable meal on the table and something that the President called for a revisit of the VAT-free basket, and we are making some submissions around this. I'll now hand over to Dries for the financial overview. Thank you very much.

Good morning, everybody. Thanks, Gary. Gary and Chris created a good understanding and backdrop to the group's results. I'll bring it all together with a couple of slides. Firstly, the income statement or the statement of profit and loss. The big driver of the recovery was the fact that we had our revenue increase by 6.4%, whilst maintaining the cost base back to the efficient farming environment, which was discussed earlier on. So the big swing in the profitability then comes from the above factors and we had almost ZAR 2 billion swing, as Chris mentioned, barring a couple of provisions that impacted on the number, but a 281% improvement or a ZAR 1.746 billion improvement from last year's loss to this year's profit. That is a recovery back to a 5.5% operating margin, which over the long term is below our average. But there's also some costs still baked in our expense base, as was mentioned earlier, related to load shedding and some hangover costs from the bird flu era. The finance charges, net finance cost for the year was ZAR 101 million. Prior year, we were ZAR 76 million. So there's been an increase year-on-year, but that's mainly because of the fact that we had the large portion of the overdrafts that we carried into this year that was unwound throughout the year. And we basically settled the debt about 10 months into the 12-month cycle. So where we are today as cash -- as Chris has mentioned, we have repaid or settled all our overdrafts. We are ungeared, which means there's of this ZAR 101 million, probably about ZAR 70 million of finance costs, which should find its way out of the picture as we move into the new financial year. Embedded in this, obviously, is our right-of-use assets and liabilities, which is the leases that we've got in the group, and that's just over ZAR 20 million of the finance cost, which will remain and obviously grow as we -- I'll touch on one of the lease profiles later on in the next slide. Income tax, tax rate of about 26.5%, very much in line with our normal run rate of tax percentage. So there's no surprises on that line. Obviously, we still carry a assessed loss into the new financial year from the prior year, which will eat into, which is good for the cash flow. And you'll see that on the balance sheet as well. There's a big pick up again on the deferred tax liabilities that has grown. Last year, we dropped the deferred tax liabilities to a lower level as we had the deferred tax asset. And as we unwind that asset, it creates a cash inflow as we pick up the tax cost and utilize the assessed loss. Then on the EPS and HEPS, 247% and 245% up year-on-year. The HEPS at ZAR 19.20 earnings per share. Main difference between the EPS and the HEPS is the insurance recovery on the hatchery fire that we had here in the Western Cape last year. Then long-term picture that we're showing you here, the full trend. The red line indicates the external revenue that the group generates. The yellow bars are the feed division revenue, and the blue bars are the poultry division revenue. And as you can see, from on a group perspective, over the long term, there's always that upward trend. A couple of blips here and there. We had small one there, but never going backwards, always just stabilizing before it grows. And I'll touch a little later on in the next slide, that fight between feed cost that comes at us and passing that cost on to the market. And that's always that fight that results in the poultry division profitability levels. You can see the feed division as a whole division, which includes the revenue that it generates from selling into the poultry division has come down year-on-year, as was mentioned earlier. That's visible here. But obviously, the mix of internal, external is starting to come back in the feed division and as well as the poultry division's growth in revenue, ultimately feeding into the group's revenue number growing by 6.4%. If you excuse the busy graph, we try to shorten it, but then it loses its impetus. This goes back to when Astral was listed. We show you by financial year. Again, the yellow bars are the profitability of the feed division, and the blue bars are the profitability and in some cases, the lack of profitability of the poultry division, which really shows the sensitivity of the poultry division or the volatility, which I'll touch on in the next slide as well. But what's important, you look at the 5.5% net margin for the group. If you look back at the history, my comment early on, it is below the average of the long term, but there's some costs still baked in here. And obviously, there's some latent potential in the poultry division as we've cut back on the volumes, and we're sitting on about 600,000 birds per week latent capacity for which a major portion of the costs are still being incurred. You can't remove those costs. It's baked in. It's under recovery, the way we refer to it. So as those birds, I think Chris mentioned the song by Dire Straits, that's kind of the space that we're talking whereas those birds comes back into the picture, you'll get the revenue with minimal uplift in cost. The feed division, ZAR 545 million operating profit. If you look back at the history, it's a -- again, the solid performance. It's visible if you look at the past, how that constant performance by the fee division comes through year after year. And the volatility around the poultry division, very visible. ZAR 580 million, still one of the better performances over the last 24 years, but still the volatility is very visible. If I go to the next slide where we show it by half year, back to 2014, again, the yellow bars are the poultry division -- sorry, the yellow bars are the feed division and the blue bars are the poultry division. You can see the profitability as it reacted to the red line is the change in broiler selling prices as we recover costs from the market. The cost that we need to recover is depicted in the green line, which is the feed input cost, the major cost driver behind the production of poultry product. And where the green bar crosses the red bar, it typically depicts problems for the poultry division. You can see the way profitability diminishes as those bars get closer to each other and cross doesn't create a great outcome. So obviously, this is the eternal fight for us is to recover costs from market as the cost of the feed pushes up from the bottom and we need to recover that from the market. Again, you can see the consistency in the feed division and the volatility in the poultry division, but a nice stable profile for the last 12 months as we've settled into a healthy gap there. On the balance sheet, I'd like to just focus on this line that calls net assets, where we've managed to reduce our net assets or in the way I look at it, we say it's the invested capital in the group. This is the net value of the assets that we use to produce our profits. So we managed to recover the almost ZAR 2 billion operating profit swing on less assets this year. And this really shows that in the last 2023 year, we had to put a lot of action plans in place, which consumed a lot of assets, and we were able to unwind those positions and by managing the balance sheet very tightly. So obviously, the recovery comes from the P&L. But if you don't hold the balance sheet tight, then you don't have the cash flow that comes out of it. And this is really the platform that was created. So a 6% improvement in invested capital that comes from a 4% reduction in our long-term assets. Obviously, there's a noncurrent -- the right-of-use assets that runs with the leases. You can see the movement there roughly contrarying each other. We managed to keep working capital very tight, which I've got a slide on. And the cash is the answer that popped out of the picture. So it's the profit plus the improvement in the invested capital in the group that resulted in us being able to repay all the debt in the group. We ended on a net cash position of [ ZAR 12.909 billion ] for the year. Equity position, ZAR 4.752 billion prior year after the loss that we incurred just over ZAR 4 billion. Capital expenditure was part of keeping the balance sheet tight if I can use that term. Depreciation, ZAR 310 million last year, ZAR 321 million, a slight uptick, mainly because of the prior year's large CapEx program that we had to incur, or you can see on the second line here is the load shedding and water-related costs that came through. So we're sitting on -- the combination of those 2, you can see there's quite a heavy investment that has gone into our preventative or defensive position on water and load shedding related costs. CapEx back to ZAR 275 million this year, more normalized profile, slightly lower than what you can expect into the future. You can probably take a cue from the ZAR 321 million. But what we also did was we managed to clean up our capital commitments in this year. Last year, we stood here, we had almost ZAR 600 million commitment on capital expenditure that lie ahead of us. We didn't spend all that money. We placed a lot of projects, if you recall, last year on hold. We managed to reschedule those into later periods when it's more aligned with the reality of what the group's market conditions are. And then we've managed to unwind or cancel the Ross-GGP farm project by negotiating with the supplier of the GGPs. And then we've got the County Fair logistics contract, which is a right-of-use asset that has gone live at the beginning of November that has been marked as ZAR 125 million asset that will come on to the balance sheet in the new financial year. Then on the working capital, just very briefly, the activities that happened in the year, we had the biological assets, which increased by ZAR 283 million. That is the repopulation program that Gary and Chris referred to earlier on, where the parent stock -- the broiler breeders had to be replenished after the bird flu impact. Then poultry inventory, good reduction in the poultry inventory, finished goods inventory, where we came down from ZAR 1.4 billion last year to just short of ZAR 1.1 billion this year, releasing cash back into the balance sheet. Feed division, keeping the silo stock well controlled. And then the receivables, this is all cash in the bank. It reflects the higher sales volume, exceptionally good quality debtors' book, almost no debt, if you unpack the age analysis that is dragged. There's really a handful of debtors in the entire group. And I mean a handful, probably not more than 5 that are dragging a little bit and it's a small number. Then on the current liabilities, keeping that tight as well, ZAR 134 million expansion in the current liabilities, leaving us with a net working capital of ZAR 6 million change year-on-year. And included in this, obviously, is some provisions and accruals as was pointed out on the waterfall graph for the profitability, which you will see on the cash flow graph. We moved that back into the profit side to show the real picture. Here, we've got the cash profit that came into the year off the base of the overdraft draft of ZAR 1.031 billion in the prior year. Generating profit, ZAR 1.4 billion. We had the insurance payouts, which included the County Fair, the bird flu, and the flood losses. That's ZAR 250 million cash that came in during the year. ZAR 142 million from the sale of our almost 10% stake in Quantum Foods. And then obviously, we had to pay some tax. And then we've got the working capital, as I mentioned earlier, the accruals portion of it, that's more of the profit nature. We reallocate here as we demonstrate this is the underlying expansion in the working capital and then that's the cash profit. We've got the capital expenditure, the cash portion of the CapEx, ZAR 258 million. And then finance expenses, lease payments and other, ZAR 235 million, leaving us with ZAR 13 million of net cash positive, repaying the entire ZAR 1 billion gearing position that we had in the prior year. This is the more standard look and feel of the cash flow statement for the audit team that sits at the back there. That's for reading. And then we've got the HEPS and dividends per share history. And I think the highlight here is the fact that we declared a ZAR 5.20 dividend per share for the full year, final dividend, and that equates to roughly a 2x cover on the second half earnings. Then to wrap up, revenue up by 6.4% to ZAR 20.5 billion. Operating profit recovery by almost ZAR 2 billion to ZAR 1.125 billion. CapEx, we kept it tight at ZAR 275 million, resulting in cash inflows net of ZAR 1.1 billion, settling the entire debt position or geared position on the balance sheet, and that allowed us to declare the ZAR 5.20 dividend. Thank you.

Thank you, Dries and Gary. That takes us to almost a close on the outlook. The outlook is not something we just sit there and decide on a couple of issues. It's well discussed, and it's presented to the Board for their guidance and their input. So this a view of how we see the next year. And some are negative, some are positive. Always try to give a balanced view of how we see the market out there or the country out there. Bird flu remains a major risk. No vaccination, no insurance, and no compensation. So -- and then we've seen in the news lately that there is quite a number of incidents of bird flu reported in Europe. So it will remain a risk. And I don't think it's going to go away up to the day where we vaccinate all our breeders and Gary [indiscernible] fighting this with tooth and nail to get that done. But it's so onerous the rules that was put to us by DAF that it's very, very difficult to sign that off and it's a continuous argument. Water supply disruptions, maybe you don't know of that year down in the Cape, but up north, a major threat, the distribution of water. There's enough water, good rains, maybe not enough dams or new dams being built, but the infrastructure is the issue. And if it wasn't for the CapEx that we have spent to mitigate these, especially reservoirs at Olifantsfontein plant that gives us additional 2 days of water usage, we would have been down much more than what we've been in the past. It is a concern. We had to buy land adjacent to our abattoir or processing facility-built reservoirs just as a backup stock. And now we're looking at further plans to have more longer-term water, buying water somewhere from a farm, build a pipeline, bring it the same and standard and the failing infrastructure most probably will bring about ZAR 100 million CapEx in the next year or 2 to do direct water line from the Vaal River to our plant. The constrained consumer spending remains an issue in South Africa. We know that we talk about 63 million to 65 million people in this country now with no new jobs being created. It should be a concern to all of us, not just to a chicken supplier. And if you don't have GDP growth, you're going to run into trouble with regard to job creation. You need about 6% GDP growth just to create jobs and keep everybody afloat. So this is a concern to all of us. And I don't think it's going to change quickly. We talk about the 2-pot system that will bring billions to the market. That hasn't happened yet. And maybe if it comes, part of it will flow into the eating habits of our people in the country. And then, of course, the interest rates that are on a downward trend could contribute to better spending over the next year or 2. I don't think it's going to happen too soon. And then the competitive retail landscape in South Africa. It's extremely competitive. There are excellent retailers and wholesalers out there. You know of all of them and especially the one we're doing a separate listing or split listing now that will bring about even more and fiercer battle for the customer. And chicken, of course, always the big draw card into any retail store with regard to promotional activity. You will never pick up a paper, a newspaper of a magazine with a broad sheet on food prices into the retail and chicken doesn't feature 2 or 3 spaces on the front page. So that's the big draw card. And sometimes we get caught in the crossfire where people want the cheapest chicken over a specific period, Black Friday coming up. And yes, the chicken producers are placed under enormous pressure there. And that is just part of life. We have to bat that one. I think the positive one is the finished goods stock levels. If you don't get to your model stock levels, it will be extremely difficult to go and demand a price hike in the market because you're going to just build more stock, put it in outside cold storage and increase your cost. So I think we're at a point now, and I'm talking about Astral, not the industry, where we are at a much more comfortable level with finished goods. And again, the contributing factors there was higher sales volumes together with the planned cutbacks. I think the one thing that businesspeople always talk about is uncertainty. And the political landscape over the past 3, 4, 5 years was extremely uncertain. We never knew where we were going and then we had this election with a lot of surprises. And I think if you could sit down before the election and say, what is your wish, what kind of permutation do you believe is the best for the business community and for the people of this country, I think we got that. So that's a positive. How long it will be stable? We don't know. But at least there's certainty now. There is a government of National Unity. I can just understand it's not easy in those negotiating rooms and boardrooms, but most probably the best outcome we could have wished for. And then we talk about the interest rate cuts. I firmly believe we'll see at least one more cut, maybe 25 points this year. I think we're lagging a bit on that. The weather forecast, we spoke about El Nino and La Nina is positive outlook. It's very early. As we sit here today, there's a La Nina on the cards with at least average rainfall and with the yields and the planting area, we could get to a 16 million tonne crop that will bode well for the poultry industry. And then Dries quickly mentioned the revised capital program. We often get asked by our shareholders and investors about future capital. One of the key things behind this, we were going to build a new GGP facility that was part of a contractual obligation with [ Avigen ] to the tune of about ZAR 370 million that -- and you won't necessarily have a return on that. So we batted that. We asked permission from the Board. We renegotiated with Avigen. Gary, myself spent a lot of time with them. And at the end of the day, we could relieve that burden of spending ZAR 370 million on a GGP facility with quite long negotiations and we're almost 90% there, Gary. We're transferring the farms we bought to them and they're going to spend the capital. And the key thing is part of that was to try and keep the GGP flock in this country. There's only 7 countries in the world that have GGP flocks. South Africa is one of them. And that is due to our negotiations with [ Avigen ]. So a huge positive, not just for Astral, but for the country to have GGP flocks. And then, of course, the spare capacity, and you should understand how important this is, if you want volume growth and price growth, we now have the capacity to grow our volumes because of cutbacks and previous capital expenditure. So a nice position to be in. In the past, I was often asked where does your growth come from and we run at full capacity, you benefit from that, from the dilution of your fixed cost. We're not in that position. We carry some cost due to that spare capacity, and Dries explained that to you. But this is a positive over the next year or 2 that we can most probably put down another 600,000 birds per week without spending any capital and it will benefit the whole integration from the breeding companies and the feed division. So that bodes well for us in the near future. That is a quick view on how we see the future, or the near future and it's been endorsed by our Board. I thank you for your time and taking interest in Astral. There is now time for questions and most probably answers. And if we can't answer any of your questions today, we'll get back to you in due course with a decent answer. So thank you. Marlize, over to you.

The first question is from the floor.

From the floor. Okay. Let's start. [ Frans ]?

There is no questions.

Is there any questions from the floor? I know some of our shareholders, investors, fund managers, market analysts and some of the people in the room we will see later today and tomorrow. We've got scheduled, I think, 16 one-on-ones. So I'm sure we'll get a lot of questions from there.

Chris, just a question. You put the slide up in terms of price inflation, selling price inflation. And then you went into quite a lot of detail around the discounting component. Is that the single biggest factor of the price deflation -- sorry, not inflation, price deflation? Or is it as a result of inefficiencies in your competitors and let's call it, government-sponsored programs in certain of the entities where they're selling chicken below cost that's putting pressure on the market.

Thank you for the question. I must be careful how I answer that. But yes, we like strong opposition that don't just sell on price, that sell on quality or innovation. Unfortunately, chicken is regarded as a commodity and the retailers want it to be a commodity. We believe there is space for high-quality branded product. But I think with a slight overproduction, the retailers will always have the pricing power. And most of that deflation, if not all of it was brought about by the competitive landscape from the retailers and wholesalers fighting for the customer and for feet on the floor. And that price is pushed down by promotional activity from the retailers. And as we stand here, we know of producers that are selling at way below cost. They've got good shareholders, I believe, who back them all the way. And it can't last forever. But I think the poultry industry as a whole are getting to a situation now where they have to rethink their strategies, especially with regard to private labels or no name brands because that's where the battle [ of fat ]. So they always put those products on promotion below the branded stuff, and that pulls down the price. And if they don't buy from you for 1-week, next week, you have double the stock in outside cold storage. So the strategy from a number of the medium-sized, very good producers, medium-sized players in the market is just on cash flow, and they would sell product below cost and drive it across the country just to get money into the bank, and that's not a positive for the industry as a whole. We don't want to profit tier. You don't want 20% margin with the money in the bank somewhere abroad. Whatever money we make, and I often tell people this, we only do 3 things with it. First, you pay tax to the benefit of the country if you make decent profits. Whatever is left is a fair split between rewarding your shareholders and reinvesting in the business. So what's so bad about that? Why does the Competition Commission want to focus on chicken price, which they don't really understand and what drives chicken price. Look at the margin of 1.3% is that profiteering. You go to the retailers with that, and you say we're in trouble, they say they don't owe you anything. and there is enough others to supply you. So it's very competitive and the retailers are masters at this. They're doing it exceptionally well is to play down price on commodities. Deflation, competitive landscape in the retailers. And sorry, our plan to cut back and sell out of stock is to get you in a position where you have model decent stock and a point to renegotiate price with the retailers. If your stock levels are too high, you're just going to burn yourself. You're going to try and get a price increase. They're going to buy less from you. you'll build more and more and more stock and pay more and more for outside cold storage. So there's always a bit of method behind the madness when we cut back. Are you happy with the answer? Good.

[ Chris Moore from Alix Fund Managers ]. If you look at that waterfall chart on EBIT, it looks like most of your profit was a reduction in load shedding. If load shedding were to return to the levels we saw in '23, do you -- does Astral make a loss? Or have you put in mitigating circumstances?

Thank you. Yes. The mitigating factors are -- we're on a program with solar, but unfortunately, at your major avatars, you can't rely on solar. There's simply not enough space for backup batteries and sun from time to time. So you have to have generators. Also the requirement from those avatars are massive for electricity. So it will be the diesel bill. We've spent the capital. We still have 1 or 2 small places where we rent generators, which will soon be replaced, which comes at a cost higher than spending capital on generators like in Olifantsfontein. But if we return to Level 6, we will not run into the big bird area because you can now slaughter, but you're going to have the additional diesel cost. And at the time, our diesel bill was ZAR 45 million a month. Hopefully, we don't go there again. But the big cost in the load shedding area was not just the diesel. It was the additional feed fed to the birds that we couldn't take off the farms to the abattoir. And that one slide illustrated very nicely. We -- that situation was on the back of cutbacks and breaking fertile eggs and a number of issues was at the end of the day, I think it was the 16th of June last year, we got back to normal, normal shape and size bird at the right age and the right feed. So diesel costs will be the only one at that time. The water -- the future water crisis is a different story. You can still buy a generator. You can't buy water. You can't create water; you can create electricity. So a lot of focus at all our plants for alternative sources to mitigate the water situation.

Was the big bird era a result of sort of higher up the value chain, not reacting fast enough. In other words, taking capacity out, higher up the value chain and therefore, not having those excess birds in addition to not having the kind of diesel generator capacity installed at the time of pilot.

Yes. A very good question. So we had emergency meeting on meeting on meeting. And of course, the last thing you want to do is not place birds because that's what we do. So you almost wait until the last minute before you make a call if you should cut back. Now the cutback is not just not placing a chicken. Remember, it's not placing a fertile egg, but that fertile egg is buildup cost from your GGPs to your GPs, to your parents. So there's a cost to it. So if you don't place it, you get a d chicken meat eventually, that comes at a cost. So cutbacks cost you money. So you push it out and you play with it as far as you can. And it was in December 2022, when we came to the realization, if we don't do something now, we're going to close this company. So we started with a massive cutback program at that time. We simply couldn't slaughter the birds. They were too big to take into the factory and the shackles, you can't. And then if you process them, the quality is bad. And now you sit with a chicken of 2.5 kilos where the market wants a 1.7, 1.8 bird. Imagine your QSR restaurant, they buy on weight, but they sell portions. So they pay for a drumstick this size, but they can only sell it for a drumstick that size. So that knocked us. And in hindsight, and we did unpack this, we could have or should have made that call earlier, but that's hindsight only. What if you cut back and you move from Stage 6 to Stage 2, you look like a fool. You look like what I look like every day, what my chairman tells me, egg on my face. I hope that answers your question. Thank you. Any more questions from the floor? Well, if not, I thank you. Marlize, any questions from my mother or --

The first question comes from Sumil Seeraj from Standard Bank. On Slide 8, load shedding costs add up to circa ZAR 1.25 billion and were added back to the full year '23 EBIT base. But on Slide 7, circa ZAR 1.85 billion in load shedding related costs were incurred last year. How should we think about the difference of ZAR 600 million? Where was the spend?

You unpack that. So we go to -- what was the first, Slide 8?

The first Slide 8, that's correct, ZAR 1.25 billion versus ZAR 1.85 billion on Slide 7.

I don't really follow the question. I see the slides, but what is the question? The difference between how we depict that?

Yes, the ZAR 600 million difference.

Dries, you want to reply to that now? I'll get back. We're seeing Sumil later today. Do you want to -- when we do the one-on-one. This is going to take most probably a long explanation. We've got the answers. And if we see Sumil on the one-on-one, it's not easy -- it's quite a complex answer. We've got the answer, but...

That's fine.

Thank you, Sumil.

[ Joel Host from Battalia]. If I heard right, Gary mentioned that there is still a small feed cost advantage using current maize and soya prices. Is this correct? And is this relative to the average input cost incurred during full year 2024?

Can you hear me? Am I on? Yes, good. Thank you. Look, it depends where you're positioned with your raw material. So at these levels and SAFEX trading at ZAR 4,900 a tonne, we are not in a position where we have to participate. We buy forward. We at least have to have a 3-month pipeline of maize secured for our factories on delivered contracts. So trading at ZAR 1,000 a tonne premium to the new season next year is expensive. There will be a difficult period of the -- with the old crop on the tail end of the old crop, so March and April, but certainly not covering feed prices now at these levels. Replacement cost is obviously a consideration in buying forward.

Shane Watkins from All Weather. Chris, I want to congratulate you on a really extraordinary career. You have been an exceptional CEO and we will miss you. My question is on imports. What is the current level of imports? And what is the outlook for DTs on dump product in the next 12 months?

Shane, thanks for the question. I have moved to that slide. You can see September was just over 30,000 tonnes a month. In that, there is still a large portion of what we call mechanically debone meat. So about 60% of that number is mechanically debone meat, not produced in South Africa with the balance frozen bone in portions. The outlook for the tariff structures remain pretty much the same. The antidumping duty, which was implemented in August last year, still has just over 3 years to run. It normally runs for 5 years. It was delayed by 12 months for the implementation. So let's say, 3 years left there. Sunset review on the U.S. antidumping duty was completed in the year. That's in place. And the generative duty on frozen bone-in portions and bonus cuts at 62% is in place. So don't anticipate any change in the tariff structure or the tariff environment for the next year.

A follow-up question from [ Joel Host ]. What is Astral's current poultry production capacity versus current production volumes?

Okay. So our capacity with capital invested over the past couple of years is close on 6 million birds average per week. With a couple of small changes, you can take it to 6.1 million, 6.2 million, but the stated capacity is 6 million. Currently, we're processing 5.4 million birds on average per week. So there's 600,000 spare capacity. And with a bit of spend, we can take it to 6.2 million if and when required if the market allows that.

Thank you, Chris. Rajay Ambekar from Excelsia Capital. What is the current split of feed cost between maize and soya? And is there any room for further optimization?

In the, there's a slide later on in the pack, additional information, so that is included in the slides that are loaded on to the website, you'll see the progression or the inclusion of maize and soya over the reporting halves. Maize is at a slightly lower inclusion in the rations right now as we have benefited from the price of soy products, full fat soya, low-fat soya, soy meal, but more particularly soy oil, which came off significant highs last year. So the balance of the -- or the source of nutrients, particularly energy has moved more to soy and a digestible or more digestible energy source in fat away from starch and carbohydrates and maize. But those slides are included later under additional information. And if there's any further questions around them, we can answer them. Thanks much.

Thank you. Follow-up question from Rajay. You commented that there are some signs of a tick-up in the consumer. What do you ascribe it to?

Well, I think that there's some benefit, small benefit from the inflation rate coming down. And I think the informal sector, we often talk about this, we investigate, we ask question. I think the informal sector that are sometimes regarded as unemployed is much stronger in this country than what we believe. And I think a lot of the spend come from that side. And also, there's been a small uptick in the employment rate, however, small. But in general, people were buying down. You can see that people are not buying new cars currently if you check the data on that. And so we think there's slight -- slightly more disposable income available at this point in time. Now chicken is in that space where people have ZAR 5 or ZAR 10 or ZAR 20 a month extra to spend, chicken is one of the options, one of the go-to products that they go to. So maybe we see a bit of an uptick before other industries will see it.

Thank you, Chris. There are no further questions.

Well, with that, I thank everybody for the questions and the answers. My Chairman, Dr. Theunis Eloff is here. He just want to have a closing word, and I apologize in advance.

Yes, I have to correct some of the things Chris said. Alex, we thought it appropriate to, at this point, say goodbye and say welcome. And first, I must say that the Board and my fellow non-execs and the execs are very proud of the results and our team. You can think of -- you've heard where we came from. And they did it basically in 6 months, consolidated in the rest. So very proud of that. And I also want to welcome our external auditors, [ Seb and Johan ], there at the back. It's not usual for auditors to attend these, but [ Seb and Johan ], you're welcome. Thank you. Also their first year of a full audit. Chris Schutte, most of you know for a very long time, at least behind this podium often walking to and fro. I don't think I share anything new with you to say that there are many attributes I can give him, but I think the most important ones is that it's a straight guy and honest. What's nice about Astral and as a Board, we appreciate that, we don't ever have to lie or hide facts or put them into the statements here at the back with a footnote, we are what we are. It's, on the one hand, a very complicated business. On the other hand, it's easy. We have feed and we have chicken and we feed the chicken, and we slaughter them and we sell them. But it's obviously not that. And in that sense, it's nice to have a CEO that leads from the front, being honest and straight. He's also humorous. Good sense of humor, you see that. I'm actually surprised Chris wasn't as humorous as always, perhaps he thinks it's a salon occasion. But the point is that Chris has driven Astral and the Astral culture of hard work and when we needed a bit of play also. And I want to ask you to thank him with me for the time that he's been with Astral and in the feed business, more than 40 years. In his own words, he has no regrets. He's cutting it off. He's staying on as a consultant, as you know, for another year for advice and so on and to help with the transition to a new CEO. But please join me in thanking Chris and wish him well. Thank you. The second goodbye to Frans. You've also come to know Frans the last couple of years. And we're very sorry to see Frans go. He's a solid manager executive. He's had a rough time, as all of our executive team has had, but he's had a particularly tough job amongst others to deal with retailers. And Frans, we're very happy that you're not going into any of our competitors. Frans is going into nuts. I hope it doesn't drive in nuts, Frans, but we really wish you well. And it's also nice at an executive level to be able to say goodbye on a very good footing. We understand, we're sorry, but we understand. So all the best. Then Dries is here. You've come to know Dries. I think it's his third presentation, if I'm correct, Dries. Dries will, now that Frans will leave a vacancy, we're looking at a bit of restructuring. Dries' role will be very important. So Dries, thank you for what you've done and for what you will do. That's a promise. We have -- we are very fortunate to have a stable Board, small Board, only 6 non-execs, working fairly hard, all of them on committees and some of them on more than 1 committee. And I think that's part of what we -- Chris and I decided we should do. We should have a good transition and make sure that the Board remains stable at this time. And with Chris' successor, we've had a very good, thorough intensive process, transparent process. We also looked outside. We made it clear to the inside guys. It's not that we don't trust them, but we think that our shareholders will at least want us to look outside. And I don't know whether it's fortunate or unfortunate, we couldn't find anyone coming close to any one of our internal candidates. And so we interviewed no one from outside. We went for the 3. I can say now Frans was one of those and -- but he withdrew from the process. And it was a 360-degree process. We also -- in that 360-degree process when you get feedback from people you work with, from people you report to and from people reporting to you, we just realized as Astral how sought after our people are. Many of our people at that level gave feedback saying, we are almost monthly contacted by either headhunters or others from other companies, not just in the poultry sector but outside. And so we've realized more and more, and we are realizing that scarcity of skills, high-level skills, management skills, other skills is going to be a factor. It's becoming a risk, probably not just for us, but for the rest. And so through this process, Gary, President, Group COO, was unanimously selected and appointed first by the Nominations Committee and then by the Board. Again, you know Gary almost as long as Chris. He's been with the company almost as long as Chris and in the industry. And Gary will have, as he knows, big shoes to fill. Fortunately, they don't look too much different when you look at their shoes. And Gary knows that -- he knows that he will have the support of the Board and he will have the support of a team. Gary will obviously have his own style. No one can be exactly and should be exactly the same as your predecessor. I think that the English will probably be a bit better in the presentations -- sorry, Chris. But I think Gary will have to work on his jokes because Chris brought something to these presentations, the jokes. So Gary, there's a development area for you. But we -- I always say in English to say good luck is nonsensical because luck has nothing to do with what you do and what you achieve. So Gary, for you, I want to say [ stacta ]. For those who are very English, strong is more or less what [ stacta ] means. Luck doesn't have any place in Astral. You know that. This is a tough business. It's a volatile business. And Gary, we have faith in you and your team to pull us through, and we'll see you in 6 months' time with the first set of results. Gary thinks he's only starting the 1st of February, but basically, the year started on the 1st of October. So he has 3 months already gone and another 3 months to come. Thank you very much. And again, thanks for those of you who are here. We understand that some people can't be here, but I must say after COVID, it's nice to see people face-to-face. But on a personal note, thank you for being here, and enjoy the day. Thank you.

Just for the people, Dr. Eloff spoke about boots and shoe sizes. For those of you who don't know, I wear a #12 shoe. I thank you for doing this journey with me. It's been very eventful. Thank you for everybody, not just the people that work with me, but all the stakeholders in the business. And I thank you for this road up to this day, 42 years. And I, as Theunis said, I leave with no regrets. And as Frank Sinatra said, the regrets, there was a few, but then again, too few to mention. I thank you very much. Goodbye.