McPherson's Limited (MCP.AX) Earnings Call Transcript & Summary

Okay. Thank you. Thank you, ladies and gentlemen. Good afternoon, everyone. No problem. No, take your time. Thank you, everyone, for attending, both those joining in person and attending online. Thank you for being here this afternoon from McPherson's Limited's 2025 Annual General Meeting. My name is Alison Cook, and I'm the Chair of the Board. As we have a quorum present, I'll now formally open the meeting. Firstly, I would like to acknowledge the Gadigal people of the Eora Nation, who are the traditional custodians of the land upon which we meet today. I would also like to pay my respects to all Elders, past and present and to all Aboriginal and Torres Strait Islander peoples who may be attending today's meeting. Secondly, in attendance today and sitting at the front of the room are my fellow Non-Executive Directors on the McPherson's Board: Jane McKellar, Ari Mervis and Helen Thornton, with Helen standing for reelection at today's meeting. We also have our Chief Executive Officer and Managing Director, Brett Charlton, who will address you shortly. From the executive management team, we have our Chief Financial Officer, Mark Sherwin; our General Counsel and Company Secretary, Craig Durham, present here today. Other senior executives and employees of McPherson's are also in attendance, both here and online. I would also like to introduce Paddy Carney from PwC. Paddy has been our lead external audit partner for the past 5 financial years. Paddy will be available later in the meeting to take questions about the conduct of the audit, the preparation and content of the auditor's report, the accounting policies adopted by the company and the independence of the auditor. In terms of future reviews and audits, in accordance with our Audit Committee charter, after 5 financial years, Paddy will now rotate off as our lead audit partner. While we've already done so before the meeting, on behalf of the Board and the company, I'd like to publicly thank Paddy for her stewardship of our external reviews and audits during the past 5 financial years. Thanks, Paddy. Accordingly, beginning for the first -- for the FY '26 first half review, we welcome Mr. David Ronald as our new lead external partner -- audit partner from PwC assisted by Jonathan Koh, and we welcome them both here today. Chris Stojcevski, representing Computershare, is also in attendance. Chris will act as returning officer for today's votes on the resolutions at today's meeting. An outline of the agenda for today's meeting is now on the screen. Following some administrative matters, I will address the meeting, and then Brett Charlton, our CEO, will speak in more detail about the company's FY '25 performance. The formal items of business to be covered at today's meeting are set out in the Notice of Meeting, which I will take as read. I intend to introduce all formal agenda items, and after each item, we will pause briefly to take any questions, both in the room and online. After all formal resolutions have been put to the meeting, we will again pause for further questions. I will now hand over to Craig Durham, our General Counsel and Company Secretary, to cover some administrative items for today's meeting. And after that, I will address the meeting. Thank you, Craig.

Thank you, Alison, and good afternoon, everyone. I will now briefly explain how questions may be asked at today's meeting and also the mechanism for voting on the resolutions, which will shortly be put to the meeting by the Chair. To assist you, you can follow what I'm explaining on the slides, which will be displayed on the screen. [Operator Instructions] Shortly, the Chair will declare voting open on all items of business. At that time, the resolutions and voting options will appear on the screen. To cast your vote, simply select one of the options. Your vote is automatically recorded and there is no need to press submit or enter button. You can change your vote up until the time the Chair declares voting closed. The Chair will give a warning before the poll is formally closed. Attendees in the room today wishing to ask a question can raise their hand. Before asking your question, if you are a shareholder, please state your name. If you are attending as a proxy for a shareholder, please state the name of the shareholder on whose behalf you are attending today's meeting. In relation to the keypads you were given upon your arrival and registration today, once voting opens, attendees in the room today will be presented with the list of resolutions on their voting keypad. Use the trackball to highlight the resolution you wish to vote on and press the green square to confirm. The resolution text will appear and bring -- to bring up the voting options. Press the green square. Press 1 to vote for the item, 2 for against and 3 to abstain. To move on to the next item, press the green square or to return to the full list of items, press the red triangle. Thank you. And I will now hand back to the Chair, Alison Cook.

Thank you, Craig. I now declare voting open on all items of business. This means that you can vote or change your vote at any time during the meeting from now until I declare the poll closed. I will provide a warning before I move to close voting. Note that the results of voting for all resolutions today will be given to the ASX shortly after the meeting. I will now turn to my remarks in relation to the company's FY '25 financial year. At last year's AGM, we outlined the transformation that was underway at McPherson's. During FY '25, we have continued to make solid progress on this, resetting our operating model and building a robust platform for sustainable growth. Today, I look forward to providing you with an update on the work underway at McPherson's and the way ahead. In August 2023, the Board appointed Brett Charlton as CEO and Managing Director with the clear mandate to transform the company given its underperformance. We then announced a strategic reset in November 2023 to focus McPherson's on its core health, wellness and beauty brands. We also announced a strategic review of Multix. This review concluded that Multix was a strong brand but was overly exposed to factors outside McPherson's control. When these factors moved against us, investment would be diverted away from our core brands. As a result, the company determined to divest Multix and to ensure investment in our core health, wellness and beauty categories, which are higher growth and higher margin. The divestment was completed and cash proceeds received in June 2024. This allowed us to turn our attention to addressing several key issues that remained post divestment, including the residual cost base of the continuing business, the relatively high fixed cost base overall and the fact that the Kingsgrove warehouse management system was no longer fit for purpose. Tackling these things has been a complex and major effort. A highly experienced new management team joined the business over the course of FY '24 and FY '25 and set out a series of logical and careful steps to ensure we could deliver on this plan. In addition, we ensured we could fund the transformation primarily through proceeds from the divestment of Multix. The Board and management of McPherson's have endeavored to provide a clear pathway and explanation of what has been achieved at every half and full year result during the past 2 years. This past year, FY '25, was one in which we took -- undertook the majority of the work to entirely reshape and reset our operating model and our CEO, Brett, will talk more about this shortly. Ensuring that we bring investors with us on this journey has been and remains critical for the Board and management. And we recognize that there is more we can do to further explain our strategy and share some of the opportunities for McPherson's. Moving to FY '25 results. The backdrop to these results is, of course, the transformation underway at McPherson's. I want to say upfront that while our results continue to reflect the transformation underway, they are not yet where we want them to be, and we acknowledge that. There are 3 key themes reflected in our FY '25 results. Firstly, this was the company's first year as a pure-play health, wellness and beauty company. However, the business still carried the residual cost base attached to the Multix business that was divested in June '24. Addressing this cost base was a priority during this financial year. Secondly, our results reflected our transition to a new operating model, which in turn is part of our effort to address the cost base and position the company for growth. Thirdly and finally, our results included the foundational investment we have made in our core brands to position them for growth during the year. The operating environment during FY '25 remained challenging, with cost of living pressures weighing on consumer sentiment. In this context, our core brands delivered moderate growth overall, assisted modestly by transitional pipe-fill revenues -- lost my place -- from the change to our new operating model. Our core brands are resilient and are in attractive categories. However, they are not yet performing to our expectations as we work to rebuild them after a sustained period of underinvestment. We have now laid the foundations for improved performance in FY '26 and beyond and look forward to keeping you updated on our progress. Transformation activities to date have been fully internally funded, both through proceeds from the divestment of Multix and operating cash flow. Our balance sheet strength is well positioned to support the next phase of business transformation. The Board determined not to pay a final dividend for FY '25. In arriving at that decision, the Board considered the accumulated loss position of the group as well as the capital needs required to support the embedding of the company's new operating model. Additionally, we elected to undertake a review of the group's capital allocation framework early last financial year FY '25. This remains ongoing with further updates on the development of this framework expected through the course of FY '26 as we fully embed the new operating model and gain a more fulsome understanding of the cash flow profile of the business. This review will include a framework for future potential shareholder returns. While this work is ongoing, other capital management activity is underway, including realizing working capital efficiencies and a refinancing of our debt facilities. During the year, I assumed the role of Board Chair after Ari Mervis stepped aside from that role due to his increased workload outside McPherson's. While Ari's external commitments have now reduced, the Board determined to retain this current Board structure through FY '25 year-end and this AGM to ensure stability and continuity during this time of company transformation. Ari remains on the Board as a Non-Executive Director and a member of both the Audit, and People & Culture Committees. However, Board renewal remains a priority to ensure that the skills, experience and capabilities we have on the Board evolve with the company's new strategy. Currently, we are engaged in a selection process to supplement the Board with at least one new director who can bring the desired skills and experience in areas such as digital technology and consumer goods. Following the appointment of a new director, Jane McKellar will retire from the Board after 11 years of service as a Non-Executive Director and Chair of our People & Culture Committee. Jane has been a committed and hard-working director and has contributed her skills to support both Board and management. This will, therefore, be Jane's last AGM, and we would like to take this opportunity to thank her and wish her well. At that time, the Board will then comprise Non-Executive Directors with tenures of 4, 5, 7 years and a new director. The Board will then determine the most appropriate committee structure, composition and leadership positions of the Board to align with the company's new strategy. I also wanted to note 2 final points on governance and remuneration. Firstly, Helen Thornton, a valued director who joined our Board in December 2021 and the current Chair of our Audit Committee, is standing for reelection today, and she has the full support of her fellow Board members for her reelection as director. Helen brings a wealth of relevant listed company experience, particularly in the areas of audit, finance, risk management and governance matters, which are invaluable for both the Board and your company. Secondly, shareholders have the opportunity to vote on the remuneration report at this meeting. The group did not meet the financial targets required for the payment of short-term incentives during the year, and vesting conditions were not met for any performance rights under the long-term incentive plan. The Board, therefore, determined that the FY '25 short-term incentive would not be paid. Nevertheless, the Board recognized the significant effort to ensure that the company delivered on our change in operating model and therefore, determined to recognize this with a modest one-off discretionary payment to certain executives. This payment will form part of the executive remuneration in FY '26 and will be disclosed for shareholder consideration in the FY '26 remuneration report. Looking ahead, the Board recognizes that it will take sustained and disciplined investment together with differentiated sales and marketing to unlock the full potential of the company's core brands in the coming years. The new operating model was specifically designed for this purpose, and the Board is confident that our strategy provides a strong platform for sustainable growth and long-term shareholder value. The company's priorities for FY '26 include embedding the new operating model, continuing to reinvest in our brands and leveraging the incremental operating benefits unlocked through transformation. On behalf of the Board, I would like to thank Brett Charlton, our CEO, the executive leadership team and all employees for their continued dedication and commitment through a year of significant change. It has been no small feat to implement the change in operating model and the Board recognizes that the McPherson's team has worked exceptionally hard to effect a smooth but complex transition. To our shareholders, I also sincerely thank you for your continued support, while we have been making the significant and necessary changes to position the company for the sustainable long-term growth. I will now hand over to Brett to share his reflections on your company, and then we'll return to go through the formal meeting -- business of the meeting. Thank you, Brett.

Thank you, Alison. Good afternoon, everyone. Just going to take you through a few points today, the strategy update. When we embarked on this strategic reset in November of 2023, we knew we needed to focus on working through our plans with a logical, methodical approach. We had a clear plan to set the business on a pathway of sustainable long-term growth, but we needed to take a careful approach. Transformations are challenging at the best of times. In FY '24, our steps were about divesting Multix and setting out a new direction for the business as a health, wellness and beauty company, leveraging the benefits of our iconic brands in higher category -- in higher growth and higher margin categories. In FY '25, our priority has been to overhaul our route to market, essentially changing the way we get our products to market so that -- as efficiently and effectively as possible and in doing so, addressing our legacy cost base, which was no longer required for the business' future. Throughout FY '24 and '25, as Alison has said, we also recruited an executive leadership team for the business, bringing the capabilities and experience we would need to deliver on our strategy. The entire executive leadership team, most of which or actually, all of which are here today -- are here with us today. And early on, we appointed a Chief Information Officer, Nathan Alexander, who's overseeing our digital-first transformation. As a consumer company focused on sales and marketing, we recruited an Insights and Growth Director, a Supply Chain & Logistics Director and a Chief Commercial Officer. We also added a new Chief Marketing Officer. The executive leadership team now comprises of a group of leaders with deep relevant experience, and this has been essential for ensuring a smooth transition to our operating model. They have worked incredibly hard. To demonstrate the depth of the change through the organization, 65% of the individuals working at McPherson's today have less than a 2-year tenure. We ended FY '25 with a very clear strategy, simplify our operations, focus our portfolio and build a leaner, more agile organization centered on our core capabilities. I'm very pleased to report that we've made strong progress on all fronts delivering the foundational changes required to reshape McPherson's into a more competitive and consumer-led business. While the international business continues to be an area of focus, trading conditions have been challenging, and in FY '25, we restructured it to reduce costs and reposition the business. There's clearly more work to do, including an assessment of the best go-to-market model and as we -- and we look forward to updating the market in due course. A major milestone was the successful implementation of our new route-to-market model. By exiting our own warehouse operations and transitioning distribution to specialist wholesalers and third-party logistics partners, we created a more streamlined, asset-light and scalable platform. This new model reduces our fixed cost base, improves service capability and enables us to focus on what we do best, building powerful brands and building demand. The way our people embrace this transition reflected the important cultural shift underway marked by resilience, accountability and commitment. I'd like to talk about our brands. We sharpened our focus on our 5 core iconic brands: Manicare, Lady Jayne, Dr. LeWinn's, Swisspers and Fusion this year. These brands are our most recognizable, generate the highest margins and hold the greatest potential for sustainable growth. In FY '25, we invested in marketing, digital campaigns and innovation and foundational consumer research across all of our brands to ensure we truly understood our consumers, and we were repositioned to evolving consumer needs. Part of our investment was in consumer advertising and promotions, where we intend to invest in more working media in FY '26. We've also aligned our promotional schedules to our customers this year with a much greater focus on promotional activities in the first half of the financial year. We also strengthened our commercial capability through the rollout of Salesforce Trade Promotions Management, TPM, and Retail Execution, REX. These modules provide our teams with better tools for promotional planning and investment review supported by enhanced data capabilities. In FY '25, our brands achieved modest revenue growth in Australia and New Zealand. As we said in August, we are clear it will take a multiyear effort to realize their full potential as we seek to rectify a period of sustained underinvestment in these brands. However, there are already encouraging early indicators that our brand strategies are working and that we are making progress and we have the road map. Fusion Health exemplifies this progress, delivering a standout result in FY '25 with revenue growth of 10.5% year-on-year. Those of you who will have seen the FY '25 results presentation will be familiar with the case study we presented on Fusion. In it, we explained how we've approached turning around and driving growth in the Fusion brand. Our strategy involves several key initiatives. Firstly, we took the deliberate strategic decision to prioritize it over other brands such as Oriental Botanicals. We then undertook consumer research to deepen our understanding of Fusion's consumer base and refined our brand positioning accordingly. We reviewed our product range to focus on our strongest performing products and implemented our new route-to-market model, including partnering with a specialist wholesaler for Fusion in the health food store channel. We also refreshed our innovation pipeline, creating an exciting 2- to 3-year road map. And finally, we developed a new brand concept, which we'll be launching -- which we launched in September of this year, with new packaging to be rolled out progressively through FY '26. Our road map is clear. Financial results have been -- as Alison laid out earlier, there are 3 key things reflecting our results in FY '25: we carried a residual cost post the divestment of Multix at the end of FY '24; the steps we've taken to resolve these costs; and foundational investments we've made in our core brands. We are very clear our financial results do not yet reflect either the benefit of the new operating model nor our aspirations for our brands and the business. With that in mind, I'll recap '25 performance. Revenue from continuing operations in FY '25 was $139 million with core brands up 1.9% to $124.6 million. Underlying EBITDA of $7.3 million was down $0.4 million compared to $7.7 million in FY '24, and the EBITDA margin remained broadly in line with FY '24 at 5.2% compared to 5.3% in FY '24. The company recognized $19.7 million in material items in FY '25, comprising mainly of $10.6 million in operating model transformation costs, including redundancy and implementation expenses and $10.2 million in noncash impairments primarily related to goodwill and certain brand assets. The company also had other material items totaling a net benefit of $1.1 million. With the new operating model substantially implemented, we anticipate a significant reduction in material costs for future reporting periods. Consistent with our results released in August, we expect benefits from the transition to our new operating model to approximate $4.5 million to $5 million in recurring EBIT from this year onwards, FY '26. A substantial portion of these benefits will be reinvested in the company's customers, brands and capabilities in this year in line with our strategy. We expect this investment will, in the first year, deliver moderate returns. However, consumer brands need consistent investment to unlock their full potential, and this early investment is an essential step in rebuilding our brands for sustainable long-term growth. As Alison said earlier, our capital allocation review remains underway. In the meantime, work on our balance sheet has continued. Our debt facility was reduced in FY '25 from $45 million to $25 million. This was to better reflect the working capital requirements of our business and reduce ongoing finance costs. With our current debt facility maturing in March of 2026, we are well placed in finalizing a new facility that will provide access to sufficient capacity moving forward. Annual operating model has further reduced our working capital requirements, reducing our near-term reliance on debt funding. We are every day building a stronger McPherson's, one that is more focused, better equipped and ready to respond to the needs of today's consumers and tomorrow's opportunities. In the near term, our priorities for the first half in 2016 are continuing to embed our new operating model, along with enhancing the talent, the processes and the capability to support it while capitalizing on the improved distribution and service capabilities and other strategic benefit -- and the other strategic benefits it provides. But our strategy largely is anchored in 4 pillars. The first one is obviously our brands. During FY '26, we will be relaunching Dr. LeWinn's. In fact, this started in September of this year with the new product development to be followed in the second quarter with refreshed positioning and a revitalized go-to-market strategy in media. Across all 5 iconic core household brands, we are focused on building volume and momentum with focused investment in high potential channels, customers and categories while, at the same time, achieving this in a sustainable way. Secondly are our customers. The potential benefits of this new route-to-market model for customers are significant, and we are focused on ensuring we can realize these benefits with improved service, scalability and efficiency. Through this, we will deepen our customer partnerships. Thirdly, our people. Along with our primary focus to ensure the safety of our people, we are embedding a more agile, accountable and consumer-led culture as a sales and marketing organization. This involves strengthening our ways of working and equipping our teams with the tools, training and leadership to thrive. Additionally, as we approach the final year of our lease at Kingsgrove, consideration is being given to the future location of our corporate offices, ensuring we have a workspace that supports long-term collaboration and employee engagement. Finally, digital. We need to keep expanding our digital capability, including practical AI learning, data and analytics to modernize our business. We're also progressing a review of our core business systems, laying the groundwork for a new ERP system that aligns with the size of the business and its requirements, which will support future growth. Consistent with our approach so far, we intend to work through the implementation of this new ERP system methodically and carefully to ensure minimal business disruption. In December 2025, we will be hosting an online strategy webinar and investor meetings to talk further about our strategy, and detail of that webinar will be released on the ASX in due course. We'll provide further details and information on our brands, our customers, our people and our digital focus, and we'll be setting out a greater detail about how we think about the future at McPherson's and our financial goals. We recognize McPherson's has changed dramatically in 2 years, and we want to ensure we keep sharing with you how our business is evolving and the futures that lie ahead. July, August and September, the first quarter of FY '26, have marked our first quarter trading under the new operating model, and we've seen steady progress towards normalized volumes. We're on track with our ambition to realize the incremental underlying EBIT benefits from our new operating model, including the cost savings from our route-to-market changes. These will be reinvested in customers, brands and capabilities this year in line with our strategy. Consistent with our comments in August, we are anticipating moderate growth in an underlying EBITDA in FY '26. As with FY '25, the FY '26 results are expected to be weighted to the second half. In closing, our approach to the transformation of McPherson's has been consistent. We have focused on the logical, the methodical and -- a logical, methodical approach and getting the basics right. Our approach to the path ahead is the same. We are relentlessly focused on turning around our core brands and growing the business with discipline. I'd like to thank our Board for its counsel and support over the FY '25 year in a very, very busy year. I'd also like to thank the executive team and all of our employees at McPherson's for their energy and resilience through a year of significant change. They have worked exceptionally hard to deliver a very complex transformation inspired by a determination to deliver the next iteration of this 165-year-old company. I'm very grateful for their efforts. And I'd also like to acknowledge especially those who left McPherson's over the year, including those team members who had worked in our warehouse for many years and for whose positions were made redundant as a part of the transformation. We thank them for their significant contribution over many years. Finally, thank you to you, our shareholders, for your continued support. We're committed to delivering sustainable value at McPherson's and accelerate into FY '26 and beyond. Thank you. I'll hand you back to Alison.

Thanks, Brett. Are there any questions in relation to either my remarks or those of the CEO's? Are there any questions -- I beg your pardon.

Yes, shareholder, [ Wolfgang Schwartz ]. My question is I bought some shares in McPherson's last year just after the meeting not long ago when the share fell off the cliff, so to speak, and they went to $0.30 and below $0.30. And well, it came up once more over $0.30, but later, they were even lower, as low as $0.20, $0.21. The question is when would you see the shares coming back again to sort of price it used to be in the 40s or lower 40s? And would there be a dividend coming when -- '26 or '27? Have you got any idea at the moment?

Right. Well, I can't comment on when the share price is going to improve because, of course, the market determines the share price. What I can say is that we're determined in McPherson's to demonstrate the value of the business and the effect of the transformation that we can deliver long-term value. In terms of returning value back to shareholders, we're undergoing a process of review at the moment and how that will happen, and then we will keep shareholders informed during the next -- rest of the financial year. Did you want to add anything else to that?

No, that's it.

Yes.

Yes, I'm a shareholder. My name is [ Sinsely ]. I have a question to the Chief Executive Officer. It's in regards to staff. I was under the impression that before we got the new Chief Executive Officer, we had -- McPherson's had a staff of around 240 people, which then was reduced to 180 people, which was further reduced to 130 people. And now I read somewhere that you have increased the staff again by 50 people. Am I correct? And why?

Brett, do you want to take that?

Yes. Good question. So a couple of years ago, when we started this transformation, we had just over 300 people, including warehouse staff. We're now down to about 100, 145 people, but that's removing about 75, 80 staff from the warehouse. So we don't expect that to move now. We expect that to be the reset model. So it's going to be around the 140, 145 mark.

[indiscernible]

No. No, I'm not sure how that came out.

I read it somewhere.

Not sure where you read that.

[indiscernible]

Thank you. Very nice. Nice to know. Ron?

Yes. It's Ron Shamgar from TAMIM Asset Management. We're a shareholder. This is more of a question, I guess, to the rest of the directors on the Board. Over the last 12 months, I noticed that Alison Cook bought $5,000 worth of shares, and Brett bought a little bit of shares as well, but no other director has been buying shares. Considering where the share price is, can sort of directors explain why they're not buying shares on the market to show to the market that the stock is cheap? Or maybe they're not buying because they don't believe it's cheap.

I'll take this one on behalf of my colleagues. We don't have a policy of insisting that directors buy shares, although we strongly encourage directors to buy shares when they can. We always have a difficulty with blackout periods. It's -- we have very narrow windows when we can purchase shares because it is a very -- it's a difficult time when we're undergoing a transformation and we're in position of knowledge that the market doesn't necessarily always hold. Individual directors make their own minds up, so -- but we don't have a policy. Any other questions? There's another one.

The question I have is to what extent does AI, artificial intelligence, plays a role? Have you looked at the company? How could it positively affect the business? Maybe limited -- they would like limited workers, use robots or streamline your efficiency and whatever.

Absolutely. I'll let Brett take this one.

Without question, one of the most exciting parts of our business is what we're doing in transforming our digital capabilities. One of those core capabilities is around AI. Every person in our business is being trained in AI with a company out of the U.S. called Section, have a series of modules, which are done online together, and we're moving through it as a company together. Our Salesforce implementation also has a huge element of agentic AI based into it, and we're focused -- we're kind of on the leading edge, to a large degree, of working with Salesforce in Australia to be applying some of that AI to analyze our trade promotions management particularly. But it honestly is just the leading edge. It's going to be an incredibly important part of the way that we go forward. And I'm pleased to report that the excitement in the business is that they're really embracing how do we go about that. So it's very much a part of what we do going forward.

Then we start to see benefits from AI [indiscernible]

I think this year, yes, I think we'll be saying very differently. We're looking for returns this year, yes. I mean, you can't be sitting around waiting for 2 or 3 years for those. It's going too fast. It needs to happen now.

Do we have any other questions from the floor? Are there any questions online?

No questions online, Chair.

Okay. Thank you. And thank you for those questions. I'll now turn to the formal business of today's meeting. The first item of business is the consideration of the financial statements and reports for the year ended 30 June 2025. These statements and reports were finalized and given to the ASX on the 27th of August 2025, and they are also contained in the company's '25 annual report given to shareholders and to the ASX on 29th of September this year. Neither the Corporations Act nor McPherson's constitution require the shareholders to vote on or to formally approve or adopt the financial reports. However, shareholders can, of course, ask questions regarding the financial reports of the company. As I mentioned earlier, Paddy Carney is here today representing PwC, the company's external auditor. Paddy is available to answer any questions from shareholders in respect to the auditor's report, the conduct of the audit, the accounting policies adopted by the company or the independence of the auditor. Are there any questions in relation to the financial reports? Are there any questions online?

No questions online, Chair.

Thank you. I will now turn to today's resolutions requiring a shareholder vote. All resolutions I will present are contained and detailed in the Notice of Meeting sent to shareholders on the 29th of September 2025. As I stated earlier, I will take the Notice of Meeting as read. Resolution 1, reelection of Helen Thornton as a Non-Executive Director of the company. Helen Thornton, a Non-Executive Director and current Chair of the Audit Committee, retires by rotation in accordance with the company's constitution and ASX Listing Rule 14.4 and being eligible, offers herself for reelection. Details of Helen's skills, experience and background are contained in the Notice of Meeting. Your directors unanimously recommend, with Helen abstaining, that shareholders vote in favor of resolution 1. As Chair of the meeting for this resolution, I intend to vote any undirected proxies that I hold in favor of resolution 1. Details of the proxy votes received on resolution 1 prior to the meeting are now shown on the screen. Are there any questions on resolution 1? Are there any questions online?

No questions online, Chair.

Thank you, Craig. Moving to resolution 2. This relates to the adoption of the 2025 remuneration report forming part of the directors' report for the year ended 30 June 2025. Under the Corporations Act, listed companies are required to include as part of their directors' report a remuneration report, which includes specific information. Our remuneration report has been prepared and was included in the 2025 annual report. Under the Corporations Act, this report is subject to a nonbinding resolution of shareholders. However, even though it is a nonbinding resolution, it has been the company's and the Board's strong practice to take the outcome of the resolution into consideration when reviewing executive remuneration. Your directors unanimously recommend that shareholders vote in favor of resolution 2. As Chair of the meeting for this resolution, I intend to vote any undirected proxies that I hold in favor of resolution 2. Details of the proxy votes received on resolution 2 prior to the meeting are now shown on the screen. Are there any questions on resolution 2? Are there any questions online?

No questions online, Chair.

Thank you. Okay. Moving to the third and final resolution for today. This relates to the proposed issue of 4,142,000 performance rights to Brett Charlton, our Chief Executive Officer and Managing Director. Further details of this resolution can be found in the Notice of Meeting. However, in brief, within our pay-for-performance framework, these proposed performance rights to be issued to Brett Charlton should shareholder approval be obtained a part of the company's performance rights plan for FY '26. This framework has been constructed to reward achievement for the CEO of key financial measures that are set by the Board and the Board believes are critical to drive growth and enhance shareholder value. Your directors unanimously recommend that shareholders vote in favor of resolution 3. As Chair of the meeting for this resolution, I intend to vote any undirected proxies that I hold in favor of resolution 3. Details of the proxy votes received on resolution 3 prior to the meeting are now shown on the screen. Are there any questions on resolution 3? Are there any questions online?

No questions online, Chair.

Thank you, Craig. I will now give a final opportunity for any further questions on any of the matters or resolutions that have been presented to you today. Are there any questions online?

No questions online, Chair.

Thank you. As there are no further questions, I confirm that a poll will now be held for determining the outcome of all resolutions at today's meeting. Please now enter your vote on today's resolutions if you have not already done so. I will now give you a few moments to complete your voting before closing the poll and the meeting. If you have any questions about how to vote using your keypads, please raise your hand and assistance will be provided. [Voting]

Okay. Ladies and gentlemen, that concludes the business to be considered at today's meeting. I will also now formally close the meeting and formally close the poll. As I stated earlier in the meeting, the final poll results will be released to the ASX and posted on the company's website as soon as they are available after today's meeting. On behalf of McPherson's Board and management, I would like to thank you for your ongoing support of McPherson's and for participating in today's meeting. For those of you who wish to stay for a short while after the meeting with Board and management present, there are some light refreshments at the back of the room. For those of you leaving us at the end of the meeting, I wish you a very good afternoon, and please don't forget to pick up your goodie bag on the way out. Thank you.