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

Good afternoon, ladies and gentlemen. On behalf of McPherson's Limited Board, I would like to welcome you all to our 2020 AGM. I am Graham Cubbin, Chairman of McPherson's Limited. It is now 2 p.m., and I'm satisfied that a quorum is present, so I declare the meeting open. As you will all fully appreciate, this year, we are holding our AGM on a fully virtual basis in the interest of protecting the health and safety of our security holders, our employees and the broader community. As you would be aware from the Notice of Meeting, there are 4 items of business to be discussed when we move to the formal proceedings. However, before that, I'll briefly cover some housekeeping matters. And then provide an overview of the company's activities for the past financial year. Our CEO and Managing Director, Laurie McAllister, will then give a brief address before members of the management team speak to the company's operational performance in more detail. We're also very fortunate to have Livia Wang join us from our key export partner, Access Brands Management, to present on our export Chairman. The formal resolutions will be considered after the presentation from the McPherson's management team has concluded. Questions from shareholders will then be considered. With me here in the company's Kingsgrove office in Sydney is Laurie McAllister, McPherson's Chief Executive and Managing Director. Laurie has continued to take McPherson's from strength to strength. Also here with me is Jane McKellar, who joined the Board in 2015 and is Chairman of our Numeration and Remuneration Committee. Jane's reelection as a Director will be considered later in the meeting. Our other Directors are Victorian-based. So Alison Mew, Grant Peck and Geoff Pearce will be joining the meeting remotely. We also have other members of our management team participating today, including our CFO, Paul Witheridge, as well as our audit engagement partner, Shannon Maher, from PricewaterhouseCoopers. Before we move to the formalities, there are several housekeeping matters I need to mention, given that the format of today's meeting is very different. Today's meeting is being held via an online platform, which allows shareholders, proxies and guests to attend the meeting virtually. All attendees can hear a live webcast of the meeting with the related slides. In addition, shareholders and proxies have the ability to ask questions and submit votes during the meeting. Voting of -- on all resolutions today will be by a poll. Once I declare the polls open, if you are eligible to vote at this meeting, a voting icon, which looks like a bar graph, will appear on your device screen or navigation bar. Once you click on this, the resolutions will appear on your screen, and you can select a voting option. To cast your vote simply select one of the options. There is no need to hit a submit or enter button as the vote will be automatically recorded. I declare that the polls for all resolutions are now open. This means that you can vote or change your vote at any time during the meeting from now until I declare the polls closed. I will give you a clear prompt later in the meeting to let you know when the polls are about to close. Questions can be submitted at any time. [Operator Instructions] Questions submitted may be moderated or combined to avoid repetition. And if questions are particularly lengthy, they need to be shortened or summarized. Finally, due to time constraints, we may run out of time to answer all your questions. If this happens, we will answer them in due course via e-mail or posting responses on our website. All questions received will be responded to at the one allocated time within this meeting following consideration of the formal resolutions. Shortly following that, I will declare the poll for all resolutions closed. Following validation by Computershare's returning officer, final proxy and voting results will be announced to the ASX later today. Moving now to comments on the 2020 financial year. It is my pleasure to report on what has been a very successful year for the company as it continues to establish its credentials as a leading supplier of health, wellness and beauty brands in Australasia. The strong financial results achieved for the year ended June 30, 2020, are a reflection of the capability and experience of our management team and Board. In Laurie McAllister and his executive leadership team, we have creative a talented leadership, along with a deep understanding of various stakeholders and the markets in which we operate. As we have all experienced, the last 9 months have presented a variety of significant challenges. During the COVID-19 pandemic, the ongoing well-being and support of our employees, as they work in challenging circumstances, has been and continues to be our highest priority. Consequently, the company has taken every practical step possible to safeguard all our employees. Maintaining the continuity of our supply chain has also been a key focus over the COVID-19 phase, with a minimal level of disruption, a testament to our close and valued relationships with our suppliers and our customers. The group's success in financial year 2020 was driven by our growth in market share across the majority of our core 6 brands, namely Manicare, Lady Jayne, Dr. LeWinn's, A'kin, Multix and Swisspers. Management's commitment to the strategy we outlined 3 years ago is evidenced in fiscal 2020 by 16% growth in total owned brand sales, 20% growth in underlying profit before tax to $22.8 million and strong underlying operating cash flow conversion of 103%. A key element driving growth of owned brands is innovation. To fuel differentiation, we have increased our investment in our research and development capability with an increase in headcount of 33% in this important area in financial year 2020. Over 200 new products we developed to support the businesses' brands with an emphasis on rapid growth skincare ranges. This innovation and our skincare product range has been successfully leveraged through our commercial partnership with Access Brands Management, ABM, which has continued to go from strength to strength in 2020 with sales increasing 133% from $16 million in financial year '19 to $37.2 million in financial year 2020. In financial year 2020, we continued to invest in medium to long-term growth opportunities with key strategic investments in the Aware Group, $3 million; and the Kotia, Soulful and Sugarbaby joint ventures, $2.8 million. Despite these investments, net bank debt, excluding lease liabilities, remained very low at June 30 of $9.2 million, with the group leverage that is net bank debt over EBITDA at 0.4x at June 2020. Three of our brands have been adversely impacted by a change in consumer demand during the COVID-19 pandemic, and we anticipate that these challenges will persist into the medium term. Consequently, our financial year 2020 results include a $10.7 million pretax noncash impairment in the A'kin and Moosehead brands and our investment in the Kotia joint venture. The group's three 51% owned joint venture, namely: Kotia, Soulful and Sugarbaby, is $2.8 million seed investments in financial year 2020 are progressing at a rate which has been stifled by COVID-19. As key customers become increasingly focused on risk-averse core ranging. These ventures, together with our operations in New Zealand and Singapore, which have also been hard hit by COVID-19 lockdowns, represent areas of future development. Dividend payments, the Board's commitment to maintaining a dividend payout ratio and our policy distribute at least 60% of the company's underlying profit after tax to shareholders remains unchanged. Dividends paid for the 2020 year totaled $0.11 per share, fully franked, representing a 10% increase on the prior year's total ordinary dividend of $0.10 per share and an underlying payout ratio of 72%. Reflections on the Board. Having renewed the Board with the appointment of Alison Mew, Grant Peck and Geoff Pearce in fiscal 2018 and '19, we are now very well placed with depth of experience and diversity of skills to assist and advise management as it continues to execute its strategic plan. Recent developments. We've had a strong start to financial year '21. We've had this significant nonrecurring provision for hand sanitizer and the acquisition of Global Therapeutics, the first serious move into health, and a capital raise of $36.5 million institutional placement and the share purchase plan. The hand sanitizer. On October 20, the company provided a trading update, outlining our strong start to the current financial year, and unfortunately, a substantial nonrecurring provision or excess hand sanitizer inventory that was required in response to very strong demand of the commencement of the COVID-19 pandemic. While current significant excess supply has led to this one-off write-down of hand sanitizer inventory, the group remains in a very strong underlying trading and financial position. As announced last week, the acquisition of the Global Therapeutics business from Blackmores represents an exciting new chapter in the execution of our strategic plan with our first serious move into the health segment. The strategic merits of this acquisition have resulted in strong institutional support for the associated $36.5 million equity placement, which was heavily oversubscribed. We encourage all our investors to consider participating in the company's share purchase plan announced last week, which will remain open until the 20th of November. The group is very well placed with a strong balance sheet to execute further merger and acquisition opportunities. Management, supported by the Board, will continue to be disciplined in its assessment of these opportunities as they arise. I will now hand over to our Chief Executive, Laurie McAllister, who will talk through the operational and financial highlights of the 2020 financial year. Laurie.

Thank you, Graham, for the introduction and good morning to all of our shareholders' joining us today as we conduct this year's AGM in the virtual realm. I do, however, look forward to seeing more of you in person across the coming months. I would like to take the opportunity to reiterate Graham's comments about our Board. I'm fortunate enough to lead a company with a Board who are not only highly experienced, but also have clear understanding of our objectives and are committed to achieving them within this dynamic and competitive world we live in. I'm also very fortunate to be supported by a fantastic senior management team. I won't take the time to go through every name here in the sake of time management. But many of you have seen the consistency of this fantastic, very, very strong work ethic, great values and great culture they are creating in this business. So why health, wellness and beauty? Well, it's big. It's $17 billion big, and it's a fact that strong -- it has strong growth rates and strong margins. And we believe that vanity and health aren't disappearing sometime soon. Three years ago, we set ourselves the objective of achieving 10 business imperatives. With the recently announcement of Global Therapeutics, I'm pleased to say that we now have achieved 9 of the 10 objectives. The point 8 being to stabilize and grow New Zealand and Singapore and expand in Asia and international. And currently, this is work in progress, but getting very good momentum. So really, today, I'd like to discuss our 10 strategic imperatives for fiscal '21. Firstly, we will continue to protect and grow McPherson's core 5 health, wellness and beauty brands in line with key macro trends. Secondly, we intend to continue to turbocharge our Dr. LeWinn's global growth plan by accelerating our new product development pipeline and geographical expansion. Thirdly, we will accelerate our ABM joint venture strategy in Greater China through extending our innovation cycle, our supply chain, new brands and hopefully, entering new categories with ABM. Fourthly, we will partner with customers to drive our brands, categories and channel expansion through superior in-store and online consumer experiences. Fifth, and very importantly, we will continue to invest in our people development, building capabilities and culture in an ever-changing environment. Sixth, we will expedite our health, wellness and beauty portfolio expansion through increased R&D partnerships and new product development investments. Seventh, our sustainability agenda will be accelerated, engaging people and engaging communities, the planet, our portfolio and our partners. Eighth, we'll utilize our strong balance sheet that Graham's mentioned and excess capacity to land meaningful M&A opportunities and geographic expansion, with a focus, hopefully, gaining some traction into Europe and further Asia. Ninth, our New Zealand and Singapore regions will be rejuvenated to deliver budgeted positive EBIT targets. And finally, we'll continue to target cost savings throughout the year. During COVID-19, well-being and support of our employees as they work in this challenging circumstances has been and will continue to be our highest priorities. We have been consistent in paying full corporate taxes, employing additional staff and continue to grow our business without assistance from the Australian taxpayer in a form of JobKeeper or JobSeeker subsidies. The photo you can see on the slide features some of our fantastic wonderful staff enjoying both their working environments and various recreational activities. I'm deeply thankful to our team with their commitment and resilience through this challenging period. Our Chief Financial Officer, Paul Witheridge, will now take us through quarter 1 FY '21 financial highlights and a summary of the recent announcement capital raising program.

Thanks, Laurie, and hi, everyone. Firstly, a summary of our first quarter fiscal '21 trading update that was released to the ASX on 20 October. The key points from that update were as follows: We achieved 4% growth in sales revenue to $49.7 million. We achieved 8% growth in sales revenue from owned brands to $41.7 million. We achieved 84% growth in underlying profit before tax to $2.9 million, noting that the first quarter is typically the lowest in terms of profit contribution. We achieved growth in category market share in 4 out of 6 of our core brands. We continued the strong China sales trajectory, fueled by a great partnership with ABM. Unfortunately, as mentioned, we did have a $5.7 million nonrecurring full provision for write-down in hand sanitizer inventory. We have provided a forecast for the first half, and that is underlying profit before tax to grow in the range of 20% to 30% above last year. And we have forecasted growth for the full year fiscal '21 an underlying profit before tax in the range of 5% to 10% above FY '20. Importantly, our dividend policy, which is to pay a minimum of 60% of our underlying profit after tax subject to other cash requirements, will remain unchanged. Now I'd like to move on to the summary of the capital raising that was recently announced. Firstly, a $36.5 million institutional placement was completed on the 28th of October 2020 at $2.27 per share. That represents 15% of our pre-raised issued capital. Additionally, a share purchase plan is being offered to eligible shareholders in Australia and New Zealand to raise up to $10 million. The share purchase plan is priced at the lower of $2.27 per share or a 2.5% discount to the volume-weighted average price over the 5 trading days up to and including the share purchase plan closing date which is expected to be the 20th of November. Results of the share purchase plan are expected to be published on the 25th of November. The share purchase plan shares are expected to be issued on the 27th of November, and proceeds from the institutional placement and share purchase plan are to be applied to: firstly, the acquisition of Global Therapeutics and related transition costs; and secondly, to provide McPherson's with additional balance sheet capacity for potential future acquisition and growth initiatives which are currently in play. I'll now hand over to our Head of Research and Development, Dr. Mary Pearce, who's going to talk about some sustainable growth initiatives. Thank you, Mary.

Thank you, Paul. Investment in innovation has been a focus of McPherson's for a number of years now. Year-on-year, we've increased our talent pool in the area of research and development, which has resulted in an increase in NPD launches from fewer than 100 just a couple of years ago to more than 200 launches in the past financial year. In the last year, we have produced some of the leading NPD launches in the pharmacy channel and have further grown the portfolio that is so popular with our partners in China. In R&D, our key focus priorities to support the business are: first, to broaden our technical capability within the business; to drive new product development; and to support existing product through existing product developments, updates and defending their position in market. In order to achieve these 3 priorities, we seek out and solidify partnerships with experts in many areas to remain lean while ensuring the company is suitably supported. As a result of the acquisition of Global Therapeutics, we will see the R&D group expand to ensure that all technical aspects are in place for future growth of these complementary medicine brands that we're so excited to bring into the company. I will now hand over to our Marketing Director, Donna Chan, who'll talk through some of our products and marketing strategy.

Thanks, Mary. The McPherson's owned brand portfolio achieved strong results in fiscal year '20. It was an absolute stellar year for Dr. LeWinn's, where we saw high revenue and in-market growth, both the domestic and export markets. During COVID-19, our diversified portfolio delivered solid gains across the Manicare, Lady Jayne, Swisspers and Multix brand. We were able to successfully capitalize on the growing consumer trend towards baking, cooking and beauty at home. Our portfolio of leading brands is well positioned to leverage the latest macro chain. Global expansion continues to represent a major opportunity. We're increasingly investing in science and clinical plans to deliver efficacious products that satisfy the proactive beauty trend. Sustainable solutions are high in our agenda as we champion first-to-market sustainable innovation to drive category growth. And in the new COVID norm, our everyday essential brands are playing an even larger role in people's working-from-home life. Looking forward to fiscal year '21, we have several exciting initiatives to drive continued growth momentum. Market expansion remains a priority, not only for Dr. LeWinn's in China, but also A'kin expansion in Asia and Europe. We're expanding Dr. LeWinn's into the beauty supplement category with clinically proven peptide drinks and powders, and A'kin is also launching a scientifically proven volumizing shampoo and conditioner this month. Swisspers continues to champion plastic-free solutions with new sizes across its cotton tip paper stems range. Multix has launched the first-to-market compostable, biodegradable and resealable snack and sandwich bags. The popularity of our greener range has called for larger pack sizes catering to larger households, and we're just about to launch on the press the Glam Cam Lash app, a new virtual solution to connect with our consumers at home. We're really excited about our innovation and market expansion plans to fuel our future growth. I'd now like to hand over to Lori P., who will take you through our customer and channel facts.

Thanks, Donna, and hello, everyone. By way of quick recap, in FY '20, performance was also solid in our major domestic channels. Across both pharmacy and grocery from a scan perspective, 4 out of 6 out of our core brands outperformed the category. In pharmacy, of the top 5 Australian skincare suppliers, McPherson's was the fastest growing. And in grocery, Swisspers accelerated ahead of the cotton category and our concentration on portfolio management drove profit. Undoubtedly, during COVID-19, we demonstrated both our resilience and agility in the marketplace. While execution remained a key focus and driver, we also pivoted and accelerated our plans in online retail and increased investment in this space in light of the channel's exponential growth. Further to this, our brand presence and availability grew within existing partners, and we're agile in launching into new channels, gaining acceptance for A'kin in both Foodstuffs New Zealand and Woolworths. This resulted in 5,000 distribution points, which have now been in market for 3 weeks, and early results are very positive. So excited to see the performance there. As we continue the positive momentum into FY '21 and look to our future plans, there are 4 key retail macro trends that help shape our approach in market in order to deliver the imperative that Laurie spoke to earlier. There is further acceleration of channel shift to online, with spend up nearly 32% in this space, and 84% of shoppers now engaging in the channel. Global expansion offers opportunities not only for brands, but also our retailers. Locally, retailers continue to look to differentiate themselves our exclusive and pseudo brands, with over 120 of these brands now available in the categories we operate in. And shopper behaviors and level of engagement are evolving with 53% of shoppers likely to change their mind based on what they see in store. So how are we leveraging these macro trends? From a channel perspective, our growth plans include another step-change for online presence and investment. Our strategic partnerships and integrated plans have us well positioned to expand geographically with our retailers. And with regard to differentiation, innovation, in-market launches of retailer-exclusive products and promotions, first-to-market opportunity and having distinct channel offerings all play a role here, given we operate in higher-engagement categories. You have heard me talk about real estate being king a number of times, and it remains a strength in delivering category solutions, improving shopability, visibility and creating disruption on the path to purchase. So we are continuing to invest in this space to secure our shelf presence, engage shoppers and influence that decision making in store. All of these initiatives form part of the ANZ sales operational imperatives that will continue our momentum for sustainable growth. We have a holistic view on range in our investment optimization, ongoing emphasis on execution with our partners, driving growth for our core brands and innovation by joint business planning. And with our largest opportunity being expansion, our plans are heavily geared to new and core brand penetration in existing customers, strategic expansion into new channels, and expansion into new categories, such as health. With that, I will now hand you over to David and Brett, who will take you through our exciting first serious move in this space.

So thanks, Lori. Good afternoon, everybody. Brett and I are going to touch on the acquisition of Global Therapeutics business from Blackmores that was executed last week. For those who are unaware of the Global Therapeutics business, it was founded in 1999 in Byron Bay, New South Wales. There are 2 key brands, Fusion Health and Oriental Botanicals. Both brands are built on the philosophy of combining the best from traditional oriental wisdom and modern science. And as you can see on the right-hand side, there are a number of large subsegments that the portfolio of products targets, including the high-growth immunity segment, which has maintained its growth rates during the COVID-19 period. The acquisition of Global Therapeutics is the start of a new health division for McPherson's. As we saw from an earlier slide that Laurie presented, there is close to $10 billion in retail sales in Australia alone in the health and wellness pillars. We believe that because of the strong focus of Global Therapeutics, on health-oriented channels, that we can also leverage those strengths to further enhance the growth opportunities for the new ventures Soulful nutritional milk and the Happy Flora digestive health propositions. The way to look at the 2 brands is that Fusion Health accounts for about 3 out of every 4 sales. It is currently distributed through the health food channel. Oriental Botanicals has been focusing purely on the pharmacy channel. Across the 200-plus SKUS, they share a lot of common formulations in the traditional herbal space. As I mentioned earlier, their portfolio is built around the main consumer need of immunity, joint health, digestive health and women's health. Fusion Health is sold in close to 630 health food stores out of a universe of 800 to 900 and it has established itself as a lead brand in this channel. As we said in the previous slide, Oriental Botanicals has achieved a penetration of over 1,100 pharmacy doors out of a universe of 5,700. In the top 10 customers, Terry White with 450 doors and Discount Drug Store with 135 are some of their top customers. We believe there's a strong opportunity for pharmacy expansion with McPherson's calling on over 5,000 pharmacy doors across Australia. When we look at complementary medicine, the focus for Global Therapeutics brands has been on the fast-growing herbal and traditional products segment valued over $800 million in retail sales, but growing at over 57% CAGR of growth year-on-year for the last 5 years, whilst the overall complementary medicine space has had a very healthy growth rate of 10%. Fusion Health as a brand crosses into the $3.1 billion vitamin and dietary supplement segment with some of the products in its range. As you can see on the right-hand side, 78% of Australians have purchased the category in the last 12 months, driven by 83% of Australian women. So we think that the herbal traditional growth also taps into the fast-growing clean, kind, vegan trend driven by younger millennials and consumers searching for more plant-based natural health solutions. With that, I'll hand over to Brett.

Great. Thanks, David. As previously noted, the acquisition of Global Therapeutics is right in line with McPherson's strategy. It's pursuing growth in health, wellness and beauty. The acquisition is EPS accretive with good growth potential, and also delivers McPherson's with a meaningful health business that it can now build upon. The brands are respected, have a unique point of difference, and the team is of a high quality with deep industry knowledge. We are very pleased that they will transition across with the business and form the basis of the new Health division. The acquisition also provides opportunity to leverage some common capabilities across the group, with the products fitting straight into our high-quality Kingsgrove warehouse, also being able to leverage the new technical capabilities for other McPherson's brands, for example, digestible beauty supplements, and the GT team being able to cross-sell existing McPherson's products into the health food channel. From a product and market perspective, we see good opportunities in New Zealand. We'll be working towards expansion into China and Southeast Asia, and we really like the Byron Bay provenance and heritage of the brands, which we feel will be further enhanced. From a financial perspective, Global Therapeutics has revenue of circa $20 million with an FY '20 pro forma EBIT in McPherson's hands of $3.7 million. This EBIT is after allowing for additional resources that McPherson's will be investing within the business. The acquisition, as I said before, is EPS accretive is expected to be mid-single digit. The business has strong margins that McPherson's can invest behind to further grow. And the acquisition further diversifies McPherson's revenue, with GT representing 8% of group revenue on an FY '20 pro forma basis. I will now hand back to David Fielding to introduce our export results.

Thanks, Brett. I have a great pleasure in introducing Livia Wang, the Chief Brand Officer, Chief Executive Officer of Access Corporate Group, or ABM, as you know it. Unfortunately, Livia is not in the same room as me unlike last year where we had a chance to, I guess, duly present the export ABM section. So I'm just going to hand over to Livia now.

Hi, everyone. My name is Livia Wang, and I'm the Chief Brand Officer for Access Corporate Group. It's my pleasure to be able to share some of the updates from our business as well as the exciting relationship we have with McPherson's, especially in the Dr. LeWinn's brand. Next page. Well, just talking about Access Corporate Group by ourselves. So since a very -- we are very, very new and a young business that we have, being able to achieve some of the very aggressive growth in the last 3 years and even given the fact that we are in COVID-19 situation, the global pandemic, doesn't stop us to grow at the rate we would like to be. So estimating our whole business growth, I think we will be from 2019 calendar year compared to 2020 calendar year, we project around 233% in the growth in terms of our GMV. Next page. Just a very snapshot in terms of the growth that we have been able to manage in the last 3 years. And at the moment, we have a new office already established in Sydney, Melbourne, Auckland and Hangzhou. And we have already opened up the business in Los Angeles and Frankfurt, and it will be coming in next month or so. And at the moment, the employees for our business is around 2,000 people. And we have around 250 in Australia, and most of the people are in China. And at the moment, we are fighting for the Double Eleven growth as well. Next page. Some of the facts, just to give the background of our business. And at the moment, we have around 100 international brands. But we focus on around 25 brands, which are the exclusive brands we are representing, and McPherson Dr. LeWinn's is one of them. We manage around 300 bricks-and-mortar stores worldwide in 25 countries. And this year so far, we have shipped around 1,500 containers of products. And given the fact that a lot of the SME protest and challenges about the freight, we'll still be able to manage that much volume, which is a very great appreciation from the businesses we support. And we just launched a new app called VTN, and that's the app we can engage with our consumer. So far, the engagement in the last 3 months has already reached out to a great demand around 100 million kind of engagement and contribute by around 5,000 of the Taobao sellers, Little Red Book key opinion leaders, individuals, retail owners. And that will also contribute by around 50,000 of the individual resellers we engage worldwide and definitely a lot of the bigger traders as well. And so far, our products -- and in the last 3 years, we have engaged around 10 million consumers. And we will -- definitely think these numbers will grow. And we don't only have China as our focus. We do have a good sign of the business growing in other countries, too. So we're definitely seeing a growing perspective. Next page. But how does that mean between Access and Dr. LeWinn's? From our point of view, we just need to have very, very focused type of strategy moving forward. Number one is the growth partnership. It means not only the current portfolio, the other portfolio, too, not only the current VTN channel, but also other key partners. Now only the hero products, but also other products. So the growth partnership with Dr. LeWinn's -- well, thanks to our new JV partners, we will need to kind of explore a lot more opportunities. And we are very, very excited about that. Number two is we need to have a new product development. That's mentioned here as NPD support. We need a lot more products because the growth is on -- untapped at the moment and -- but we need to supply and to bring a lot more new news towards it. And also, the integrated marketing approach. That means from the general perspective, from the information perspective, from events, from branding, for assets, from the endorsement, testimonials, alignment, new products. So a lot of integrated marketing solutions. We would like to work really closely with the Dr. LeWinn's brand team to make sure we actually do it well, and I think we will. But it's just one of the strategy we really want to invest the resources in. The smart supply chain will be the next strategy we're going to take because the demand response, given the current environment, we need to be very careful. And just to make sure we are smart on how to respond to the demand, how to supply quicker and how to be agile in the market is something we will work together. And the last phase is the global expansion. We think the brand has been super strong. And how can we push that momentum to next level will be something we need to focus on. So between 2019 and 2020, I kind of pull up the 3 numbers so we can see the strong growth from Double Six, Super Brand Day and Double Eleven. They all show a very strong growth sign on that. And we will become very Tier 1 skin care brand in China, and we wish that can grow globally, too. Next page. So I just kind of zoom in one of the top of 6 performers with the Dr. LeWinn's. So that the consumers of Dr. LeWinn's is always something I really focus on. I feel like as long as we have a lot of consumers, that means the performance will always grow very strong. And so far, we already have been able to sell the products to around 100,000 and more consumers across the global spectrum, and it doesn't see a lot of that portion coming from China. And the Triple Defence, the products, we sold 85,000 units, 66,000 units for the mask and 60,000 units for the plumping gel. If you look at that number in 1 day, lots of products to be sold through. And we have seen the emerging hero products coming alone, including Eye Mask, Trinity Pack and the Boosting Essence. So we not only have 1 or 2 hero's products now, we actually have a lot more coming on. So that's exciting for us. Next page. And a lot of marketing, working with the brand team definitely helped the brand status in the market. It does include -- the beauty awards include the complex Triple Action Defence awards in China include the Clinically proven resources, include a lot of features in the magazine. And we have the seeing -- in the last 3 years, the brand has been -- as a kind of hero brand in Australis grow, become a kind of a global status, the brand, and get recognized by variety of the magazines, media and awards, which is we're very, very proud of. The next page. And -- well, just about to happen tomorrow, so very, very current, is tomorrow, we're going to have a big event in, which is the international import expo. To be able to be accepted as [ ex beta ] in China for this kind of exhibition definitely show the status of the brand. And we will have around 150,000 global professional purchasers going through this event. And it will have a lot of visitors across the whole world. And it's a lot of potential market for -- just during this event. So it's a very iconic event, and not all the brands can be accepted to enter. And in fact, we can feature Dr. LeWinn's in this event. It's going to be fantastic. So there will be a CCTV interview. It will be a lot of brand media exposure in that sense. So -- but it hasn't started yet. It starts tomorrow. So the team definitely work really hard to make sure this has a great success, and I believe in that. Next page. Double Eleven is around the corner. Our targeted RMB GMV will be around RMB 154 million and today is the Brand Day. But it hasn't yet knowing the whole numbers, but we definitely think this will be a great success as expected. And we need to make sure everything we do actually contribute, not only the short-term sales but also a long-term success for the brand. So in summary, I think Dr. LeWinn's has been in a very great year for 2020 given the challenging time. Next year, our opportunity will come in from the next level of -- from the products, from the packaging, from the branding and from the integration approach, we can go into the market. And it's definitely not only from the revenue point of view anymore, we will have to invest to make sure we become a very, very strong brand and be recognized by our consumers. And we -- partnership with McPherson's and Dr. LeWinn's has been -- hasn't been very strong before. So we become -- we can leverage our resources to share the data, getting the consumer insight through to the brand team to make sure we make smart and right decisions moving forward. Thank you very much.

So thanks, Livia. As you just heard, we are really excited about the near- and longer-term opportunities for Dr. LeWinn's with ABM. For FY '20 and the start of FY '21, the export business continued to deliver really strong growth for McPherson's. The growth trajectory of Dr. LeWinn's in China is a testament to the strength of the McPherson's and ABM relationship and the joint approach to innovation, strengthening the portfolio and building engagement in the Dr. LeWinn's brand. Starting with 1 hero SKU back in FY '17, the business has strengthened in revenue and scope, achieving more than $37 million in FY '20 and expanding to 5 SKUs. For the current year, we are targeting $48 million in sales, up 30% on FY '20 and also expanding to 6 hero SKUs or products. Major ABM event promotions provide that litmus test for brand health, and Dr. LeWinn's has maintained its top 3 position within the ABM portfolio of brands. The WeChat search history demonstrates the growing awareness for the Dr. LeWinn's brand, with relevant spikes in certain periods aligned with the key ABM promotional events. The brand is becoming less and less reliant on a single product or SKU as new product innovation resonates with the ABMers. Dr. LeWinn's continues to be committed to innovation as a core pillar of the brand. The new introductions are consumer-led, targeting highly engaged skin care users. Dr. LeWinn's is focused on delivering clinically proven formulations with the newest technology and ingredients, with 2 new products coming in 2021 specifically developed for the China market in strong and fast growing segments. Whilst addressing gaps in the range, the introductions will engage existing loyalists and invite new consumers into the brand. Shortening the lead times for bringing innovation to market are key objectives for growth in China. And finally, McPherson's relationship with the Aware Group underpins the success of Dr. LeWinn's with ABM in China. And we recently produced a 1 million unit in Australia and now accounts for over 25% of all Dr. LeWinn's units produced. With further tech transfer underway, this relationship will only grow stronger. The strategic alignment with Aware was strengthened by the progressive increase in equity share MCP holds, having grown to 10% in FY '20. I'll now hand you back to Laurie McAllister.

Thank you, David, and thank you to the rest of the team who've been presenting the dynamic plans. So to conclude, I will reiterate the quality of our current financial performance and restate our outlook for the first half and fiscal 2021 year. Following a really strong last year, 20% growth in FY underlying PBT, the group has achieved plus 84% growth in quarter 1 FY '21 in underlying PBT. As we mentioned before, sales in the core brand have grown 8% in the quarter -- first quarter this year. Our export sales of Dr. LeWinn's have grown 19% in quarter 1, and this is obviously supported by such an amazing partnership with Livia and her team at ABM, the great capabilities, great innovation, great passion and a great business model. The group has a strong underlying trading and financial position despite the $5.7 million nonrecurring full provision for excess hand sanitizer. Growth through M&A is a strategic priority. Global Therapeutics is our first initiative to establish a new health division at McPherson's. Obviously, that's supported by a very healthy balance sheet and low gearing. And as Graham and Paul mentioned, we do intend to maintain the current dividend policy of a minimum of 6% of underlying profit after tax, subject to any cash requirements. And lastly, we've offered guidance, 5% to 10% growth in underlying FY '21 PBT over FY '20. So finally, it's important to emphasize that, as always, and particularly during COVID-19, the well-being and support of our employee needs continues to be of the highest priority. I'd also just like to thank Livia again for your time today. I know that's -- you've got an enormous month going on, and for the whole ABM team for the partnership. So that concludes the presentations for today. I'd now like to welcome our Chairman back to the lectern to commence the formal proceedings of the meeting. Thank you.

Thank you, Laurie. We will now proceed with the formal business of the meeting. For the purpose of the meeting, we'll take the Notice of Meeting and explanatory notes as having been read. The first item in the Notice of Meeting is consideration of the financial statements and reports for the year ended June 30, 2020. This is a [ core section ] of McPherson's constitution, requires shareholder to vote on or formally approve or adopt the financial reports. However, shareholders can, of course, make questions regarding the financial reports and regarding the company. As I mentioned earlier, Mr. Shannon Maher is available today representing the Coopers -- the company's auditors, PricewaterhouseCoopers. Should there be 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, then Mr. Maher is available to answer those questions. I will now move to the second item of business. The second item of business is to consider the adoption of the remuneration report for 2020 as set out on Pages 37 to 52 of the company's annual report. Although this resolution is not binding on the directors of the company, it does provide an opportunity for shareholders to express an opinion regarding the company's remuneration policies. The outcome of the vote will be taken into consideration when reviewing remuneration practices and policies in the future. I now move that the company's remuneration report for the financial year ended June 30, 2020, is adopted. As I indicated earlier, polls for voting on this and each other resolution are currently open. The next item of business is Agenda Item 3 relating to the reelection of Jane McKellar as a Director. In accordance with the requirements of ASX Listing Rule 14.4, Jane is to retire as a Director at this meeting and being eligible, offers herself for reelection. Information regarding Jane McKellar's qualifications and experience is set out in the explanatory notes to the Notice of Meeting and on Page 32 of the annual report. I will ask at this point for Jane to provide a very brief summary of her background and experience. Jane?

Thank you, Graham. Good afternoon, everybody. I believe I'm not the only one standing for reelection today, given what's happening in the U.S. But from my perspective, my executive career was as a senior executive and a CEO in companies like Unilever, Microsoft and Elizabeth Arden. And my core areas of experience are really around consumer and customer-centric business, marketing, digital, international and business transformation. Subsequently as a Board Director, I sit across several industries, but all with a laser focus on the customer. It also gives me a breadth of experience, which hopefully I can also bring to the McPherson's team. I'm thrilled to have been on the Board at McPherson's since 2015 and to watch it thrive under this excellent management team. I feel privileged to continue to be a part of that McPherson's journey. Thank you, Graham.

Thank you, Jane. May I add that Jane has been a very effective Director of the company and in her role as Chairman of the Board's Nomination and Remuneration Committee. I have the pleasure of moving Ms. Jane McKellar is reelected a Director of the company. Agenda Item 4 is the last item being considered at today's AGM. This relates to the proposed passing of a special resolution approving 2 types of amendment to the company's constitution. These relate firstly to a new requirement in the ASX Listing Rules that listed entities include specific provisions in their constitutions covering restricted or escrowed securities. McPherson's does not currently have any such restricted securities on issue, but the proposed change to the constitution is considered prudent in providing flexibility, should such securities ever be issued in the future. The second proposed amendment is in accordance with ASX Listing Rule 15.11.1, which requires the company's constitution to be consistent with the ASX Listing Rules at all times. This amendment deems our constitution consistent with the ASX Listing Rules should any apparent inconsistency ever arise. All details of the amendments are set out in the explanatory notes to the Notice of Meeting. I will now take this opportunity to share us a very brief summary of the proxy voting received on this and the other 2 resolutions being -- 3 -- 2 resolutions being considered at today's AGM. In real summary form for each of the 3 resolutions, there's been about 58 million votes voted in favor, which represents somewhere for each resolution between 97% and 99%. And the votes against and the votes left open are all -- in each resolution, less than 1 million shares. That concludes the formal business of the meeting. I will now consider any questions submitted from shareholders, which I believe there are a number. And so we still will leave available the opportunity for shareholders to submit additional questions if they haven't already done so. So I will ask our CFO, Paul Witheridge, to read out the questions. And then we will address those questions one at a time.

Thank you, Graham. We have around a dozen questions. So quite a bit to get through, but I will read the question, and then we'll throw the question to the relevant staff to answer the question. The first question is, "There was growth in the market share of 4 out of 6 core brands. Which were the 2 that did not grow?" I can answer that question. The 2 that did not grow in terms of market share for Multix and A'kin. So Multix did grow in terms of overall sales, but it did drop marginally in terms of market share. Second question, "Negotiations to retain hand sanitizer were unsuccessful, and you are now pursuing other relationships to maximize the value. What are these?" I can answer that one. We are looking extensively within the customer base in both Australia and the export market. They're commercially sensitive discussions, but suffice to say, we are talking to significant local grocery players as well as export customers.

Hi. Just to build on that, but we're taking this so seriously that each week, we have a forum purely to discuss how we're going to flush this through the system.

All right. Next question, "Dear management, can you advise on the proportion of FY '20 revenue is generated from the ABM partnership Dr. LeWinn's on [ hand sanitizer ] was 17%. And if you look at our presentation, where we did the FY '20 results, you can see that, which I think on Slide '20, 17% of our revenue, growing from 0 back in 2016. So now [ that's across the 17% ]. Next question. "ABM has, in the past year, onboarded several other beauty brands. How will MCP ensure that ABM continued to promote Dr. LeWinn's brand prior to VTN platform?"

Actually, Livia, do you want to...

[ Is she still on? ]

Yes. Livia, do you want to maybe talk to that?