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

Good morning, ladies and gentlemen. My name is Ari Mervis, and it is my pleasure to welcome you as Chairman to 2021 Annual General Meeting of McPherson's Limited. It is now just past 11:00 a.m., and I'm satisfied a quorum is present, so I declare the meeting open. While we are gathered for this meeting from various locations, I would like to take a moment to acknowledge and pay my respects to the traditional owners of the land where I'm seated today, the Biddegal people, and pay my respects to the elders, past, present and emerging. Today is McPherson's second virtual AGM, and I thank you for your understanding with this. Whilst the pandemic-related restrictions are beginning to ease, taking into account public health advice, we are once again holding our AGM today online with Board and management team members joining from different locations. We look forward to hopefully being able to conduct future AGMs on a face-to-face basis. We have made every effort to ensure today's meeting is as interactive as possible with the opportunity for shareholders to ask questions in a number of different ways and to be able to vote online. And of course, technology being technology, if we do have a technical issue, please be patient and we will resolve it as quickly as possible. Joining me today, either in Sydney or virtually from various locations, are Chief Executive Officer, Grant Peck; CFO, Paul Witheridge; Company Secretary, Phil Bennett, who will also facilitate the Q&A sessions later in the meeting. And also in attendance are the other Non-Executive Directors, Graham Cubbin, Alison Cook, Jane McKellar and Geoffrey Pearce. I would also like to welcome Paddy Carney from our auditors, PwC; and Wayne Hopkins representing our share registry, Computershare. The Notice of Meeting for today's AGM was dispatched to shareholders on the 22nd of October 2021. I will take the Notice of Meeting and the explanatory notes forming part of the Notice of Meeting as read. The items of business to be covered at today's meeting are set out in the Notice of Meeting and are now shown on the screen. The intention is that I will introduce all of the agenda items, following which we will take shareholder questions on all the agenda items. Before I provide my opening remarks, I would like to outline how the meeting will proceed and provide instructions on how to ask questions and how to vote on the formal matters considered later in today's meeting. Today's meeting is being held via an online platform, which allows shareholders, proxy holders and guests to attend the meeting virtually. All attendees can hear a live webcast of the meeting and can view the related slides. In addition, shareholders and proxies can ask questions and submit votes during the meeting. Online attendees can submit questions at any time. [Operator Instructions] For those shareholders who wish to ask a verbal question, an audio question facility is also available during the meeting. [Operator Instructions] Questions submitted may be moderated or combined to avoid repetition. And if questions are particularly lengthy, they may need to be summarized. Finally, due to time constraints, we may run out of time to answer your questions. If this happens, we will endeavor to answer them in due course via e-mail or posting responses on our website. All questions received via text and by audio questions will be responded to at the allotted time following consideration of all the formal resolutions. Additional questions may also be asked at that stage. Shortly after the question session, I will declare the poll for all resolutions closed. We will display in the proxy voting results on the screen for each resolution in conjunction with consideration of that resolution. I confirm that directed proxies will be voted in accordance with the directions given. I'll also confirm that I will vote any undirected proxies left to my discretion as the Chairman for each resolution in favor of that resolution. Shareholders entitled to vote to today's meeting have been validated at registration. Those entitled to vote will see their voting card on their screen at the time of each resolution. I'd like to briefly speak about shareholders that have appointed proxies and who are also in attendance today. According to our constitution, the authority of the proxy to speak and vote for a shareholder at today's meeting will be suspended while the shareholder is present at the meeting. Therefore, I would like to remind members that if you have appointed a proxy to cast a vote on your behalf, your attendance and participation at today's meeting would imply that your proxy no longer has an ability to vote on your behalf. In other words, you will need to cast your vote yourself in person at today's meeting. Voting on all resolutions today will be via poll. Once I declare the polls open, if you are eligible to vote at this meeting, a new voting tab would appear on your screen. Selecting this tab will bring up a list of resolutions and present you with voting options. To cast your vote, simply select one of the options. There is no need to press a submit or enter button as the vote is 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 that the polls are about to close. We will issue the results of the voting for each of the resolutions on the ASX market platform after we complete today's AGM. Now before we move to the formal business of the meeting, I turn to my Chairman's address. The results of this past financial year were unacceptable, and your Board is acutely aware of the disappointment experienced by shareholders and the need for rapid and significant change. At the 2020 AGM, despite the initial ramifications of COVID-19, there was optimism within the company. Strong sales to China were projected to continue, the pending acquisition of the Fusion Health and Oriental Botanicals brands provided a new revenue stream, and the well-supported capital raise provided further funding for future acquisitions and growth. Disappointingly, the positive results were not forthcoming and the China cross-border e-commerce channel all but disappeared, and further appropriate acquisitions were not identified. The extended government-enforced lockdowns to contain the spread of COVID-19 changed consumer shopping patterns and behavior, driving more at-home purchases and reduced spending on skincare products. Furthermore, many health stores, where the newly acquired health brands are distributed, were forced to close their doors for extended period. This culminated in 2021 being one of the most challenging years for McPherson's in its recent history. While the fundamental opportunities in health, wellness and beauty sector remain robust and the domestic business particularly in core company-owned brands continues to deliver positive results, your Board recognized the need for swift and significant action to address the underperformance. Starting at the top, a process to refresh the Board was undertaken. And I was fortunate to be approached to join the Board and subsequently be appointed as Chairman. I will speak more about this prior to the resolution being put before shareholders regarding my election as a director of the company. It would, however, be remiss of me to not recognize at this point the enormous contribution made by Graham Cubbin to the company over the past decade as a director and the last 6 years as Chairman of the Board. His leadership and direction have been a fundamental driver of the clarification of the company's strategy and its strategic direction as a health, wellness and beauty brand owner and provider. The true value of his influence should not be underestimated. While the journey has had its challenges, none more so than in the past year, the destination and clarity of purpose has not wavered. Graham has always put the welfare of those under his charge and the stakeholders of the company above personal pride, and it was he who identified and recognized that the time was appropriate for him to step down as Chairman. We are, however, fortunate that Graham has agreed to stay on the Board until we appoint a replacement independent non-executive director, and we're making good progress in this regard and hope to make an announcement on this in the near future. Furthermore, a new CEO was appointed, and we're fortunate to have someone of Grant's skill and leadership to reset the business and position McPherson's for future growth. Grant has also implemented numerous changes at the senior levels within the company, and he would expand on this during his address. When McPherson's disappointing performance became apparent, the Board and management team, assisted by external advisers, undertook an extensive operational review. In May of this year, the outcomes of that review were announced, which included identifying and prioritizing McPherson's key growth drivers and related strategies to deliver both short- and long-term value to all stakeholders. The primary focus remains on continuing to drive core owned brands and key domestic channels. This is where the majority of the company's earnings are generated, and it is crucially important to win with the winners both in terms of brands and in terms of customers. Secondly, the integration of the health division is progressing as contemplated. And as the organization develops further competencies in this area, health and wellness offer a new and, to date, untapped growth platform. Thirdly, leveraging the lessons of the past, the company will continue to cautiously expand its international footprint. And finally, with the need to enhance profitability, the cost base is being continually scrutinized to find efficiencies to be able to free up resources to reinvest into growth. I'm confident that management is making significant progress against these strategies, and Grant will elaborate more in detail in his section of this meeting. On the 1st of November this year, the company announced an update to the market, including expectations for the first half of this fiscal. This announcement also included a material provision for Dr. LeWinn's inventory held for China. While it is most disappointing that the provision was deemed necessary, it not only removes the uncertainty of how the stock was to be sold, it also provides management with a clear space to continue their strategy implementation and will ensure that the brand integrity is maintained. While the financial results of the past year are evident and the disappointment experienced particularly with regards to sales in China should not be underestimated, it is important to recognize the ongoing success in the core domestic market. It's encouraging that in spite of macro headwinds, the strength of the company's core range ensured continued growth. During the pandemic, consumers continued to buy trusted brands from trusted sources, and it is pleasing that this trend has continued into the current year. With this as a backdrop, we remain cautiously optimistic that the platform for growth will continue as management recalibrate the company to deliver sustainable and profitable growth. Importantly, the company's financial position remains strong with its leverage ratio being defined as net bank debt excluding lease liabilities to underlying EBITDA at 0.5x and its gearing ratio remaining low at 6.8% as at the 30th of June 2021. Given the strength of the balance sheet, capital management initiatives have been considered. However, your Board deems it prudent to retain flexibility as we move beyond the recent COVID-19-related uncertainties. During these uncertain times, McPherson's has proudly remained a key supporter of our community and partners, including the collaboration between Lady Jayne and the Children's Charity Variety as well as McPherson's employees volunteering to team up with the Two Good Co. This epitomizes the dedication and commitment of our employees, and I would like to take a moment to thank them all for their dedication during a very challenging financial year '21. They have been exceptional under trying circumstances, and we are most grateful for the professional way they have conducted themselves. I would also like to thank you, our shareholders, for your continued support. Your Board does not underestimate the disappointments that shareholders have experienced over the past year and fully recognizes the need for improvement. With a strong plan in place, we look forward to working with the management team to deliver sustainable, profitable growth and generate value for all shareholders, employees and customers alike. I will now call on Grant Peck to present his CEO's address to this meeting. Grant?

Thanks very much, Ari. Good morning, and welcome, everyone. Thank you for your attendance and interest in McPherson's today. I was appointed McPherson's CEO almost 12 months ago. As I reflect on the 2021 financial year, I can only agree with Ari. I think it's fair to say it was one of McPherson's most challenging years in the last decade. Throughout the year, due to the pandemic, we have continued to see Australians living through various lockdowns with large parts of the population having to navigate some form of stay-at-home measures during this time. The McPherson's team largely performed their roles remotely with great commitment and focus. Equally, the warehouse and distribution teams continued to fulfill orders, adapting quickly to the health requirements directed by the authorities. We continue to meet the protective measures implemented by various levels of government with a lens on protecting the health and safety of team members, customers and the broader communities in which we operate. I'm very grateful for the support of my team, customers and suppliers as we navigated 2021 against this very challenging backdrop. And while it was challenging, 2021 was also a year of significant contrasts. We delivered strong growth in core beauty brands Manicare, Lady Jayne, Swisspers and A'kin, with a 9% increase in domestic sales of company-owned brands during the year. Unfortunately, our resilient domestic performance was more than offset by the significant decline in sales of our Dr. LeWinn's products to China, which resulted in a 10% decline in revenue. We recorded underlying EBITDA of $11.3 million, and our balance sheet remains strong with low debt gearing. Of course, it's not possible to review '21 without reflecting on the disappointment and the impact of the business outcome in respect to the China market. So I'm going to go into some detail on that now. In the year ending June 2020, our Dr. LeWinn's brand delivered stellar growth in China through our cross-border e-commerce channel to this market. This growth was on the back of our successful anti-aging product innovations in the Australian market. The daigou phenomenon, fueled by international tourism and students, created significant demand for Chinese consumers. This, in turn, generated substantial growth in turnover from fiscal 2017 to fiscal 2020, with particular success in the Chinese consumer promotional periods like Singles Day. As we moved through fiscal 2021, the impact of the COVID-19 pandemic on our narrow path to market played out on what had been a runaway success. In the context of rapid growth and repeated out-of-stock positions, the company faced the prospect of supply chain uncertainty and, in conjunction with our end market distributor, thought it prudent to build considerable stock positions. With an already long supply chain inflated by contingency, the inventory levels reflected an expectation of significant continued growth. In fact, the first few promotional periods during the early onset of COVID-19 continued the growth profile we've seen pre-pandemic. However, as we now unfortunately have seen, the fundamentals for international skincare brands in a cross-border e-comm sense changed. The sales outcomes across the market from the 11/11 promotion in November 2020, which is normally the largest annually, fell well short of expectations. The combination of materially reduced daigou demand for Australian products and stronger domestic Chinese skincare offerings appealing to the Chinese consumer resulted in a significant reduction in sales for Dr. LeWinn's in China. Our expectation of a modest rebound in demand in China in the first half of fiscal 2022, which was supported by feedback from our key China customer, has disappointingly not transpired. As Ari mentioned, we announced on the 1st of November the decision to incur a one-off provision in the range of $8 million to $10 million in relation to excess Dr. LeWinn's inventory in our first half 2022 results. Ultimately, this will protect the Dr. LeWinn's brand equity longer term. The lessons from this experience are numerous and will result in an improved strategy and approach to international markets. As a Board and management team, we are clear that performance must improve. China will remain as a key market for McPherson's as it's one of the world's largest skincare markets. Our updated strategy involves broader distribution, acknowledging the vulnerability of our over-reliance on one channel in China. The Dr. LeWinn's brand remains popular in China. Consequently, the company does expect improvement over time. A measured, self-funded approach to expansion in other international markets has also commenced with the company recording its first sales of approximately $100,000 in the United States in September of 2021. But there remains a far broader context for McPherson's. The daigou cross-border opportunity at its peak was only 15% of McPherson's turnover. The domestic core business resilience and performance through a prolonged period of changing consumer behaviors arising from the pandemic is very positive. McPherson's underlying core performance is based on a breadth of channel participation, 6 strong core brands and participation in categories poised for continual and enduring growth with an addressable market in Australia of $15 billion. We are well positioned to leverage positive macro trends in our industry, the growth of proactive beauty, strong reputation for beauty products made in Australia, the growth of beauty routines at home particularly supported by the pandemic, and the consumer trend towards more sustainable products. Following the disappointing results out of China and having been appointed as CEO, the company undertook an operational review to identify and prioritize McPherson's key growth drivers with a view to implementing strategies that deliver both short- and long-term value to shareholders. The review had 2 core components: firstly, an examination of the group's strategic frameworks; and secondly, the construction of a disciplined strategy supported by a highly capable team to achieve those objectives. I'd like to update you all on progress against the operational review, which will simplify our business, drive efficiencies and assist in returning the company to profitable growth. The review identified initiatives across 4 key areas with a target to deliver $300 million in total sales and $50 million in total EBIT by FY '26. The 4 key strategic pillars are a continued focus on core owned brands and key domestic channels; establish health and wellness as a new growth platform; expand our international footprint; and recalibrate our cost base. A key first step to execution of the operational review has been the extensive reshaping of the management team with a focus on accountability to deliver against the strategic cornerstones. In order to support the strategy, we have restructured the executive team with commercial heads for ANZ, health and wellness and international, each with a divisional profit and loss accountability. Furthermore, the executive team has been reduced by 3, simplifying the reporting structure and reducing costs. We now believe we have the right team in place, focusing on the key objectives in our 3 business units of core brands, health and wellness, and international. I would now like to look at each of these strategic pillars in more detail and provide an update on our progress. Our first strategic pillar is a focus on our core owned brands, where we will achieve growth through better ranging as well as customer and channel expansion. By focusing on innovation, we'll also tap into adjacent categories, leveraging the strength of our brands. This is the key pillar of our operational view -- operational review, and I am pleased to report that our focus is delivering results. At the end of October, we continue to track positively towards our targets. Some highlights are shown on the presentation slide that you can see, and I want to point out a few here. On ranging, we have confirmed an additional 60,000 distribution points against our annual target of 79,000 and are on track to reach our full year '22 target of 1.2 million in total. Our focus on well-defined innovation continues to fuel our growth, with incremental sales from 163 active and planned projects in the NPD pipeline. The company will continue to evolve its sustainability credentials, established through the market-leading position it has taken with its Multix Greener range and new product development targeted at removing plastic packaging and product components. Establishment of clear sustainability goals with relevant product innovation will continue to be an important element of the company's future sustainability agenda. The company is actively leveraging the strength of its brands and expanding into adjacent sectors, such as launching a Swisspers hypoallergenic skincare range specifically for infants. This has resulted in the continued growth of our core brands with sales up 9% year-to-date at 30 October 2021, when compared with the same period last year. Moving on to our second strategic pillar, establishing a growth platform in health and wellness. During FY '21, McPherson's expanded into the health category with the acquisition of the Fusion Health and Oriental Botanicals brands in December of 2020. Through the acquisition process, McPherson's recognized the complementary nature of this category. It represents a key adjacency that our core skill sets, broad customer base and logistics capability are uniquely positioned to support. This well-recognized brand and product offering -- broad product offering led to a -- led to the creation of McPherson's health and wellness division, providing a new category from which to deliver future growth. Our focus with this division is to access ranging upside in the Australian pharmacy category, grow international distribution for the brands and accelerate new product development. The health and wellness division generated incremental sales and profit before tax of $9.2 million and $1.4 million, respectively, in FY '21 from its first 7 months' ownership under McPherson's leadership. I'll now spend some -- spend a little time to provide an update on the integration of Fusion Health into McPherson's. The newly formed health and wellness division introduces significant capability and category knowledge with deep health store and pharmacy distribution experience who have transitioned well into the new McPherson's health and wellness business. At acquisition, product supply levels were significantly disrupted, and this was leading to stock shortages. We have now largely addressed this issue, and our in-stock provision -- in-stock position significantly improved in the first quarter of FY '22 with availability of over 95%. The COVID lockdowns did impact the health store channel, where physical stores were mandated to close and rely purely on online fulfillment. However, we are now seeing demand recover as lockdown ends. Despite this challenge, we remain on target to deliver planned sales and EBIT in the health and wellness business in fiscal 2022, in line with our expectations on acquisition. Demonstrating the channel opportunities associated with health stores, the team have achieved incremental distribution of the A'kin range into 129 health food stores. In respect of the Fusion brand, we remain excited. We are planning to deliver 7.5% of sales through new products in FY '22, and this number could well be a modest expectation as consumers continue to seek natural solutions to enhancing their immunity. We have refreshed and revised the Fusion brand identity by simplifying in simplifying and contemporizing the look and feel of the packaging. We have been very encouraged by the success of our Wintering Well campaign, which drove consumer reconsideration through winter. This award-winning campaign increased website traffic by 48%, new users by 44% and delivered over 23 million ad impressions and 2 million video views across Google and Facebook. We've also progressed swiftly with the operational efficiency initiatives in the health business. In order to extract operational efficiencies in the health business, we have implemented a new go-to-market strategy in WA, which creates improved customer service, insight and understanding. This strategy is cost-neutral in FY '22 but is expected to deliver a 10% EBIT improvement in the health business in FY '23. Now on to our third pillar. The expansion of our international footprint is the key strategic pillar that will take more time and focus to execute given the current circumstances. I've already covered our approach in China. However, the company is also taking a measured, self-funding approach to broadening our brand presence in targeted countries, having acknowledged the vulnerabilities of an international strategy that focuses on a single channel into one market. In the U.S.A., Dr. LeWinn's brand registration is now complete and the distribution has commenced. We are now live on the Amazon platform and have started to record initial sales. We're planning on international market entry for the Fusion Health brand with scope and route-to-market assessments underway for selected international markets. And recently, we have entered the Middle East and Southeast Asia with A'kin launching on LOOKFANTASTIC, a leading online skincare and cosmetics retailer. In the second half of 2022, the Dr. LeWinn's brand is now available in health and beauty retailer, Watsons Saudi Arabia, Kuwait and shortly in Singapore. Lastly, the company has recalibrated its cost base with actions already taken to realize annual cost reductions of $3.5 million at an estimated one-off cost of $0.6 million and capital expenditure of $0.9 million. This includes the realignment of the business around the 3 commercial business units, resulting in a simpler organization; removing complexity by exiting loss-making joint ventures; and having a strong and focused but leaner leadership team in place, which I have discussed earlier. As you can see, we're making significant progress against all of these strategic pillars, and I look forward to continuing to update our shareholders in February. On to a trading update. As announced in early November, we concluded there will be no material improvement in sales into China in the short term and we're not expecting any material profit from trading in China in FY '22. However, there has been a material improvement in the domestic operations where company-owned brands continued their growth trajectory into FY '22. Our domestic momentum is, however, being frustrated by well-documented local and international supply chain disruptions due to several factors mainly related to post-pandemic instability. The company is working closely with its logistic partners to address any challenges associated with this peak period. Cost pressures, particularly in the well-documented area of commodities and international freight, are being addressed with urgency. We have recently submitted price increases targeted at particular Multix categories in response to the cost inflation that the market is currently experiencing. These cost pressures and price increases were reflected in our first half and full year 2022 forecast published on the 1st of November 2021, where we announced total sales growth of between 8% to 10% for the first half of 2022 and 6% to 8% for the full year. We also announced our forecast for underlying profit before tax for 2022 half year to be below half year '21. However, we expect to deliver a $1 million to $2 million increase in underlying profit before tax for the full year as we realize the positive impact of favorable FX hedging results and the full effect of various cost reduction initiatives. The group's balance sheet remains strong with net bank debt at 30 June forecast to be similar to that recorded at 30 June '21. Based on the trading period 31 October '21, and the company's visibility on performance of core brands, underlying cash conversion is forecast to be in the range of 85% to 90% in FY '22. The company's relatively low net bank debt will enable maintenance of its policy of paying at least 60% of underlying profit after tax as dividends, subject to other cash requirements and customary approvals. Before handing back to Ari for the formal part of the meeting, I want to reiterate some key points. This year has proved to be a similar one for McPherson's. The experience across the last 2 years led to a deep introspective review of the company and what it needs to achieve. This review in the context of the desired future for the company demonstrated we selected well in respect of where to play. The health, wellness and beauty choice is a resilient one where we have strong brand and distribution capability. We understand we have gaps in respect of how to play, and we are addressing these urgently, especially in the international space. We have very strong fundamental established positions and unique capabilities. Firstly, we have significant demand for our well-established core brands and products, driving our expected 6% to 8% growth in '22. Secondly, we continue to fuel interest in these brands via strong levels of innovation, which is driving additional ranging and value to our trading partners. Our supply chain and warehouse capacity offer an ability to further capitalize on the reach and distribution footprint our brands command, and we will selectively leverage this core capability, just as we are now doing the introduction of our health business to the warehouse in Kingsgrove. In time, our strong balance sheet will allow us the flexibility to make the most of opportunities which arise. Currently, the balance sheet supports our ability to sustain difficult and unpredictable market conditions and invest behind our core brands and capabilities. Finally, to our team, we have a rejuvenated and experienced team driving the execution of our clear focused health, wellness and beauty strategy. I'll now hand you back to our Chairman for the formal part of our meeting.

Thanks very much for that, Grant. Ladies and gentlemen, we will now proceed with the formal business of the meeting. As indicated earlier, for the purposes of the meeting, we will take the Notice of Meeting and explanatory notes as having been read. The first agenda item is the consideration of financial statements and other reports. The first item in the Notice of Meeting is consideration of the financial statements and reports for the year ended 30 June 2021. Neither the Corporations Act nor McPherson's constitution requires shareholders to vote on or to formally approve or adopt the financial reports. However, shareholders can, of course, submit questions at any time or ask questions verbally later regarding the financial reports and regarding the company. As I mentioned earlier, it's our pleasure to have Paddy Carney here with us representing our company's auditors, PwC. Should there be any questions from shareholders in respect to the audit report, the conduct of the audit, the accounting policies adopted by the company or the independence of the auditor, then Paddy 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 2021, as set out on Pages 35 to 56 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 30 June 2021 is adopted. I will now share with you a summary of the proxy voting received on this resolution. As I indicated earlier, polls for voting on this and each other resolution are currently open. An opportunity to ask and respond to questions will take place once all resolutions have been considered. It should be noted that should this resolution receive more than 25% of votes against it, this will constitute a first strike of the remuneration report. In any event, given the high amount of proxy votes directed against this resolution currently, the Board will take due note of the consideration of shareholders. Agenda item 3 is the election of a director, being myself. The next item, ladies and gentlemen, agenda item 3, which -- relates to my election as a director. At this point, I therefore feel it appropriate to step down as Chairman and ask Jane McKellar, one of my co-directors, to take the Chair.

Thank you, Ari. In accordance with the requirements of ASX Rule -- Listing Rule 14.4, having been appointed a director of McPherson's on the 16th of February 2021, Ari retires as a director at this meeting and offers himself for election. Before Ari makes a few comments regarding his background and experience, I'd ask him to say a few words regarding his credentials.

Thank you, Jane, and thanks for the opportunity to introduce myself as I seek election as an independent non-executive director of this terrific company. By way of background, for most of my corporate career, I was involved in driving the success of fast-moving consumer good companies. Branded companies are focused on placing customers and consumers first while delivering superior returns for all stakeholders in a responsible and sustainable manner. Some of these companies require turnaround strategies, and others were focused on acquisition integration and synergy delivery. And while I certainly enjoyed all these varied aspects of management, my primary ambition has been on driving enduring strategies that deliver profitable top line revenue growth. I was most fortunate to have spent a large portion of my executive career working for a global beverage company that grew and evolved from humble beginnings focused on emerging markets to become the second largest brewer in the world. My personal journey took me and my family from our home in South Africa to spending several years in Swaziland, Russia, Sydney, Hong Kong and finally, Melbourne, which we now call home. With a background in finance and marketing, I first rose through the organization to become managing director of various subsidiaries and was a member of the global executive committee when the company was acquired for USD 120 billion in 2016. I will always be grateful for the enormous opportunities I was presented with, which exposed me to such a wide array of different cultures and people, but equally for the opportunity to have landed in such a marvelous country in Australia and in the special city of Melbourne. After my time in the brewing industry, my experience included having been Managing Director and CEO of the largest dairy in Australia, Murray Goulburn, where I learned the importance of local, iconic companies and how to operate in an environment with paper-thin margins. It also ensured that I have relentless focus on governance and control matters and increased my interactions with the ACCC, ASIC, the ASX, the Foreign Investment Review Board and regional, state and federal government departments. My non-executive experience includes having been a director and chairman of joint ventures as well as a director of listed and unlisted companies in countries including China, Hong Kong, India, Vietnam and Australia. I've also been executive chairman of a private equity earned portfolio company and was a non-executive director of the Melbourne Business School for several years, which helped develop my appreciation for societal contribution and not-for-profit involvement. I'm currently an independent non-executive director of Myer Limited. In McPherson's, I see a company clearly with a tremendous history and an enormous potential. It is a company that has fantastic brands, a solid customer base and a talented workforce. While, of course, there is much improvement required, I think that the fundamentals of the business are robust and well placed to be built upon. I believe that I bring to the Board a fresh and different although relative -- relevant perspective of how to optimize the many facets of management of consumer goods companies to improve performance and results. My experience in the whole of business with complex challenges and evolving channels to market will complement the skills of our fellow directors and will ensure that we support and challenge management to deliver the best results for all stakeholders. I thank you again for attending today, and I hope that I can rely on you for support of my nomination.

Thank you, Ari. I advise that further information relating to Ari's background and relative experience is set out on Pages 8 and 9 of the explanatory notes accompanying the Notice of Meeting and on Page 30 of the annual report. I would also like to say that the rest of the Board strongly supports Ari's election. His positive contribution to the company in the short time he's been on the Board and as Chair has been excellent. And I have pleasure in moving that he has elected a director of the company. I will now share with you a summary of proxy voting received on this resolution. As indicated earlier, the polls for voting on this and each other resolution are currently open. Thank you, and I will now hand the chair back to Ari.

Thank you, Jane. We will now move on to agenda item 4, which is the reelection of a director being Ms. Alison Cook. In accordance with the requirements of the ASX Listing Rule's 14.4, Alison is to retire as a director at this meeting and, being eligible, offers herself for reelection. Information relating to Alison's qualifications and experience is set out on Page 9 of the explanatory notes to the Notice of Meeting and on Page 31 of the annual report. At this point, I will ask Alison to provide a brief summary of her background and experience.

Thank you, Ari. I appreciate the opportunity to reintroduce myself as I seek a second term election as an independent non-executive director of the McPherson's. I have a somewhat unusual background for a consumer goods company as I'm a scientist. My initial training was in microbiology, focusing on virology, immunology and epidemiology, which has proved very useful over the past couple of years as we've collectively navigated the COVID pandemic. My career started in the manufacture and testing of veterinary vaccines in the animal health industry, where I worked across sites in New Zealand, the U.K. and Australia. During 13 years with CSL in Melbourne, I worked in senior executive positions across 3 divisions, culminating in the management of the pharmaceutical manufacturing operations. As you will likely appreciate, CSL has been an Australian success story, and I was fortunate to be with the company over its formative years as a listed entity. Thus, I appreciate the importance of excellent leadership, a clear strategy and a focus on the end customer. Subsequent to this, I spent time as CEO of a genetic testing services company, which was listed on both the ASX and NASDAQ and has a presence in both the U.S. and Australia. I have spent the past 6 years utilizing my skills and experience, consulting to the biopharmaceutical industry from start-ups to multinational companies. In 2018, I accepted the role of Non-Executive Director with McPherson's to assist and support in this company's move into the health care space. With the acquisition last year of Global Therapeutics, I have been able to utilize my manufacturing, health care and TGA regulatory knowledge to support both the due diligence and integration of this business into McPherson's. It has certainly been a challenging period over the past 2 years both within and external to the company. And I look forward to working with Ari and the rest of my Board colleagues with your support as we rebuild this great company for the future. Back to you, Ari.

Thank you, Alison. And may I add that Alison has been a very effective director of the company and equally in a role as Chairman of the Board's Audit, Risk Management and Compliance Committee. I have pleasure in moving that Alison Cook is reelected as a director of the company. I will now share with you a summary of proxy virtual received on this resolution. The next agenda item is agenda item 5, which is relating to the reelection of Mr. Geoffrey Pearce as a director. In accordance with the requirements of ASX Listing Rule 14.4, Geoffrey is to retire as a Director at this meeting and, being eligible, offers himself for reelection as a director. Information relating to Geoffrey's experience is set out on Pages 9 and 10 of explanatory notes to the financial meeting and on Page 31 of the annual report. I would, at this point, ask Geoff to provide a brief summary of his background and experience.

Many thanks, Ari. And let me say at the outset how pleased I am to be invited to stand for reelection to the Board of McPherson's as a non-executive director. Over now more than 4 decades of experience within the Australian manufacturing and pharmaceutical cosmetic industries, I've had a vast array of experiences in terms of logistics, manufacturing, supply. And of recent times clearly navigating my way through the incredible challenges of -- that COVID has thrown upon us. I've had experience in the public company space as a -- as the recently departed chairman of Probiotec Limited, a contract manufacturer in the pharmaceutical space and remain currently a non-exec director of Cann Limited, the preeminent Australian medical cannabis business. Likewise, I've got current responsibilities as chairman of an as yet unlisted medical technology business called Ellume Limited. And so my manufacturing background, aligned with my importing and logistics experience, has me well placed to be able to provide an ongoing benefit to McPherson's as it navigates its way through this incredibly challenging period both in the recent past and probably in the near-term future. Thank you.

Thanks very much, Geoff. I'd also like to just add that Geoff has an incredible and extensive knowledge and experience in the category in which we operate from both a manufacturing perspective all the way through to a very close connectivity with the market that we service, and he too is a very effective director on the Board. I have pleasure in moving that Geoff is reelected as a Director of McPherson's, and I will now share with you a summary of proxy voting received on this resolution. Ladies and gentlemen, agenda item 6 relates to a resolution relating to the issue of performance rights to the Managing Director as follows: That for the purposes of Part 2e.1 of the Corporations Act and the ASX Listing Rule 10.14 and for all other purposes, the grant of performance rights and shares on exercise of such performance rights to Mr. Peck, the Managing Director of the company, under the McPherson's Limited performance rights plan and his employment contract with the company, is approved on the terms set out in attached explanatory notes to this Notice of the Annual General Meeting. This is an ordinary resolution, and if passed, the issue of performance rights to the Managing Director will approve on the basis set out in the detail -- in detail in the explanatory notes to the Notice of Meeting. I will now share with you a summary of the proxy voting received on this resolution. As full details of the proposed grant of performance rights to the Managing Director is set on explanatory notice, I do not propose to restate those. However, I think it is important that I point out the following. Firstly, this resolution relates only to the proposed grant of performance rights in the current year and doesn't include any approvals being sought in relation to performance rights or grants to the CEO in future financial years. Secondly, the resolution refers to 3 categories of performance rights, namely rights granted in connection with Grant's appointment and commencement as McPherson's CEO and Managing Director; rights granted annually as part of his base remuneration; and rights issued in conjunction with Grant's long-term incentive arrangements. Thirdly, for the commencement of the annual rights to vest, Grant must remain appointed as CEO and MD for at least 3 years. Vesting of the long-term incentive performance rights is subject to the achievement of challenging financial performance outcomes of the company measured over 3- and 4-year performance periods and as is set out in detail in explanatory notes of the Notice of Meeting. Finally, any shares which may be issued following the vesting and exercise of performance rights are subject to holding lock restrictions, further aligning the CEO's remuneration outcomes with the interest of all company shareholders. Should this resolution not pass, Mr. Peck's employment agreement requires that the company provide comparable cash-based payments and LTI structures in lieu of each element of the proposed rights grant. Please ensure that you cast your vote on this resolution and all other resolutions. Ladies and gentlemen, that concludes the formal business of the meeting. I will now consider any questions submitted and asked -- as asked by shareholders. Please feel free to submit any questions for consideration now if you have not already done so. I will also hand over to Phil Bennett, the Company Secretary who will facilitate the Q&A session. Phil?

Thank you, Ari. The first question is from Mr. [ John Gassner ], who asks why are performance goals so low for CEO bonuses.

Mr. [ Gassner ], firstly, thank you very much for your attendance, and thank you for your interest in the company and the question. The view of the Board and, in fact, a review of external advisers that we have consulted in this area is that the targets set for the LTI for Mr. Peck are, in fact, anything but soft and easy and, in fact, to the contrary. What we have done is ensure an alignment that the goals that have been set to achieve these performance rights are stretching targets and the business will really need to outperform in order for Grant to be able to take advantage of them.

Thanks, Ari. There's another question here from Mr. [ Gassner ] who asks in relation to dividends for this financial year. And I'm thinking in that context, he's talking about FY '22, which has been discussed but...

Again, Mr. [ Gassner ], thank you for that question. While obviously the Board, at this stage, cannot commit to what, if any, dividends will be paid out, we haven't changed our dividend policy to date, and we do have a robust and healthy balance sheet. But obviously, any dividends will be subject to earnings and subject to the mandatory approvals required in order to pass those dividends. Thank you.

Thank you. A further question from Mr. [ Gassner ], who is inquiring in relation to the arrangements with the previous CEO.

Mr. [ Gassner ], thank you for that. The previous CEO was terminated on a mutually agreed basis between him and the company and all other terms of his termination that haven't otherwise been made public or subject to confidentiality agreements.

We have a question here from Ms. [ Stevens ], who is asking in relation to the purchase of the Global Therapeutics business, which, as she correctly states, was around 12 months ago and at the time was described as highly complementary and EPS-accretive. Basically, Ms. [ Stevens ] is commenting on the capital raising price and the current share price. And basically, their question is, what -- how would we categorize this business that was acquired just 12 months ago? And why does the Board now place a little emphasis on this supposed game-changing acquisition?

Ms. [ Stevens ], again, thank you for your attendance and interest, and thank you for your question. I think there's 2 components to the question: the one relates to the capital raise at the price at which the raise was done; and the subsequent share price fall off. And I think that we have covered that in quite a degree of detail, which is on -- largely on the back of the disappointing outcome of Dr. LeWinn's in China. As far as the acquisition goes, I will ask Grant to make some comments about it. But I think what the company saw at the time was not only an opportunity to expand into a new area of revenue growth but also to be able to complement its existing portfolio and make us a true operator in the components of health, wellness and beauty. I will ask Grant to pass some further comments just around the performance of the health -- around the health and wellness division.

Ms. [ Stevens ], thanks for your question. We are very excited about health and wellness division and the acquisition. We would acknowledge that we picked up a business at the time where availability was lower than we would have liked due to disturbance in the supply chain from a pre-acquisition perspective. We've addressed that. And we're now seeing relatively full levels of availability. We're very excited about the health and wellness division because it speaks to a lot of our core competencies, but it also adds significant IP in respect of natural paths and people that are passionate about health. And certainly, that adds a great degree to our existing portfolio. And we really see this as a platform for growth in the immediate future and for a good time yet.

Thank you. We have another question from Mr. [ Gassner ], who asks, who are the major shareholders in McPherson's now? Normally, holdings by investment houses don't tell us who actually owns the shares.

Mr. [ Gassner ], thanks for that question. And I will ask Phil to elaborate further. Under the ASX listing requirements, if there is a shareholder that is categorized as a substantial shareholder, the beneficial owner has to disclose to the ASX that they hold more than 5% of the company's issued capital, and that is then in the public domain.

That's absolutely correct, Ari. The only thing I might add is that often, holders specifically choose to hold their shares in a nominee for those exact purposes, and that's their choice. The next question is from the [ SAB Super Fund ], who asked, why was hand sanitizer procured with such a short expiry date, resulting in the write-off? All other hand sanitizer products in the market have a 2- to 3-year shelf life.

Mr...

That's from the [ SAB Super Fund ].

Yes. Thanks for the question. Not so much a shelf life issue as a quantum issue and a net realizable value issue. The world moved very quickly to create an enormous amount of hand sanitizer, and the market for hand sanitizer was nowhere near the amount of hand sanitizer that was created. So unfortunately, we're in a position of needing to take a provision against that inventory.

Thank you, Grant. This question is from Ms. [ Stevens ], who is asking about the Dr. LeWinn's brand. She asks, can the Board please help shareholders better understand what specifically occurred with sales of Dr. LeWinn's in the domestic Chinese market in FY '21 and the sales adversity that appears to be ongoing in that market? That's the first leg of her question. She has a second one which really relates to why the company is persisting with this brand. And it's described by her as being difficult or the market in which it is trading in China being a difficult, nuanced and a fickle market, albeit a large one.

Ms. [ Stevens ], again, thank you for this follow-up question. I think that during Grant's presentation, he's covered in quite a degree of detail what happened in China with regards to Dr. LeWinn's, specifically with the single-channel cross-border e-commerce daigou trade, which virtually overnight disappeared and created obviously the surplus inventory that was generated on the expectation that sales will continue. The brand itself remains very strong and very robust. In-market consumer research done in China indicates that there is still a latent demand for the brand. And I think the challenge now for management is to ensure that they find the appropriate path to market in order to service consumers with what is a really strong brand and they've got a lot of real brand credentials behind it.

Thank you. We now have a live audio question. It's from [ Gavin Black ], who has registered as a guest, and it seems to have a number of aspects to it. So thank you for your patience. Could you please go ahead with your question?

Ari, congratulations on joining the Board in February. And hopefully, the confirmation of your appointment as Chairman in the resolution. I guess my first question really goes to the credibility and the trust in the company and the reliability in relation to the operational review that was conducted by your executive team. We're 6 months past this review, and we've got yet another disappointing trading update despite Global Therapeutics now actually being included in the financials. Core brands are up, yet the net profit before tax is going to be 8% lower than the prior comparative period. Why should shareholders trust the company that it can deliver on its plan? It seems to, I guess, make endless stock and investment write-downs, but it can't make good on its promise to shareholders.

Mr. [ Black ], thank you for the question. Thank you for your introduction, and I also appreciate your support and your congratulations that you have voiced to me. So I appreciate that sincerely. I think just the first point -- and I will hand this over to Grant to speak you through it. I think that the outcomes of the May review have been well articulated, and the company is now set clearly on a strategic path to execute and implement that outcome. The stock write-down of Dr. LeWinn's was a hangover from last year that took up until the date which we made the announcement to establish whether, in fact, there was going to be an ability to realize the value of that inventory and what the best way was to reduce the inventory. And at the date at which the company made the announcement was the date that the Board came to the conclusion that it was in the best interest, albeit not a very pleasant decision, to take the provision firstly so as to ensure that we're complying with all our continuous disclosure requirements but equally to ensure that we didn't have this inventory overhang that could be sold at a significant loss, which would result in damaging the brand. And to Ms. [ Stevens' ] earlier question, a brand that, in fact, has got a great resonance within the Chinese consumer base and equally within Australia. So I think what we'd like our shareholders to do is to take into account the way the decisions have been taken, the thought that's being put behind those decisions, the consideration that we put behind it in coming to those conclusions, certainly not easy decisions and certainly not decisions that one would take lightly but decisions that are required to get this great business back on track. Turning to other points, and I'm glad that you recognized that our core brands continue to grow and will continue to expand in very challenging and difficult market environments where we are seeing many retailers for large parts of the year in eastern seaboard of Australia not be able to operate at full potential, consumers not being able to shop to full potential. And yet, we have pleasingly been able to continue to deliver through to the end of October, continued volume growth of core brands within Australia. I'll now just hand over to Grant if you'd like to build anything on that.

Yes. Thanks, Ari, and thanks, [ Gavin ]. Look, I won't go back and recap on the China piece. There's a misstep there, and it's nothing significant. But I think your question also goes to confidence. And I just want to talk about the business in Australia. We are the second largest ASX-listed supplier into the Australian pharmacy channel behind only Blackmores. We're outperforming the pharmacy channel in 10 of the last 12 quarters across due to the breadth of our product and category options. We're delivering award-winning innovations with Multix Greener, which recently won the NielsenIQ Breakthrough Innovation Award. We've launched award-winning marketing campaigns in health with the Wintering Well campaign. We've untapped potential in channels other than pharmacy and grocery and online. And our infrastructure is capable of taking on more than we're doing right now. Our business definition gives me great confidence that keeping within these guardrails will provide superior growth opportunities in the future. And yes, we know that our international opportunity needs to be approached sensitively from a risk and reward perspective, but there's greater opportunity and greater potential there. So I think -- I acknowledge the missteps. We're working through that. They're not insignificant, but the underlying fundamental business is extremely strong, and I look forward to being able to grow it significantly in the future.

Thank you, Grant, and thank you, Mr. [ Black ] for the question.

Thank you, Ari and Grant. This question is from Ms. [ Jannison ], who asks, could you please discuss how procurement and supply and stability of product looks as we move into 2022? How is McPherson's in tackling this?

Thanks, Ms. [ Jannison ], for that question. I'll ask Grant to respond to that, if I may.

Sure. I mean yes, it's -- like a lot of companies, we're dealing with some instability both internationally and also locally at the moment. Internationally, there's significant cost push in the commodity space. But also, as is well documented in the press at the moment, in the shipping space, that particularly plays out on the more bulky products we have in our range. The Multix, we're actually going to the trade right now with price rises to offset that cost push that we are seeing. From a local perspective, it's difficult at the moment. And stability around local delivery, we are working extremely hard as a pharmacy supplier where we do get some level of preference as being a critical supplier in that space, but we're working extremely hard on keeping up with the demand, which is extraordinary at the moment. There's -- every week is a Christmas at the moment in the logistics space in Australia, so working very hard with our partners to continue to keep on top of that delivery. As I think everyone will have noticed in slots in Coles and Woolworths, for instance, not everyone's getting service perfect. I wouldn't say our service is perfect by any stretch of the imagination, but we're certainly looking to close that out. As we get into December, we have confidence we can do that.

Thank you, Grant.

Yes. Thanks, Grant. Ms. [ Jannison ] asks another question. In this case, can you please discuss in a bit more detail regarding whatever is being done to address environmental issues and carbon emissions moving forward?

Thanks, Ms. [ Jannison ]. And this is certainly a topic that is very close to the Board and something that the Board has an enormous amount of interest in. I will ask Grant to elaborate on what specifically is being done in specific reference to some of our brands and how we are operating in that area as it is something that society at large and certainly companies need to take ownership and accountability of in order to ensure that we protect the environment.

Thanks, Ari. Yes, I guess, our 2 hero brands in this space are Multix and Swisspers, and we're looking to continue to create more environmentally appropriate footprint in bags, wraps and foils in our cotton products. And so we've actually been replacing all of our stems in the Swisspers range and have made great ground in that space. In addition, I talked about Greener, the brand offshoot of Multix which was really a leader in that trend into bags, wraps and foils and providing for a more sustainable footprint. Of course, sustainability is more than just about our product and our product footprint. We've got an end-to-end program associated with not just our products but also our footprint that, in fact, we talked about in some length with the Board in the Audit and Risk Committee meeting just yesterday. And so we've got an end-to-end program in that space, which will address everything from packaging in all forms whilst we'll keep some brands clearly at the hero position from a sustainability perspective.

Thank you, Grant, and thank you for that important question.

This question is from [ SAB Super Fund ]. And they asked, was there a search for a new CEO? They have heard comments that Grant Peck was set to inherit the CEO position without a genuine search process for the best possible candidate.

I think I can put your mind at ease that what was conducted was an external search using an external third-party recruiter to present to the Board and to the People and Culture Committee and the Nominations Committee potential candidates. At the end of that process, the Board gave the unanimous consent, agreement or conclusion that Grant would be the right person to be appointed as CEO. He had knowledge and understanding and commitment of the business, having been a non-executive director for a few years and equally having had an experience in many different FMCG environments also as an MD and CEO. And hence, it was felt that he had the appropriate leadership skills and skills to take the business to its next step.

Thank you, Ari. We have a second audio question here from [ Gavin Black ]. Please go ahead and state your question.

My question goes to, I guess, what we've seen over the last 12 and 18 months with the disappointing trading update. And really, the -- now the question goes to -- the Board, back in March, said that the company that was around $170-odd million of value was really undervalued, significantly undervalued. What does the Board think of its current value?

Mr. [ Black ], thank you for that question. I think the important thing is that when the Board came to the conclusion in March or around then -- around the valuation had based it on the information that are at hand, all the knowledge and all its understanding, all its evaluations of the business. It's not the Board's position to determine what the share price is or what it trades at. The Board's position is to ensure that it governs, leads and directs the business in the right strategic direction, holds management accountable to deliver on the results and get the best performance out of the business for all stakeholders in the business.

Thank you. We have a question here from Mr. [ Birken ] and Mrs. [ Davies ] who asked, will A'kin be sold in IGA or other supermarkets?

Mr. [ Birken ], this is David. Thank you very much for the question. My answer would be I hope so, but I'm certainly going to ask Grant to elaborate on that.

Yes. We've got -- certainly got some aspirations for A'kin with -- we think the next -- I think the next 2 years is a very exciting one for A'kin. We believe some subtle repositioning is probably due. We're seeing nice growth in hair care in this brand. In terms of specifics around ranging, we're -- I think I've already talked about health care stores and that we are always looking for ranging opportunities with the appropriate customers. And breadth of ranging, I'm absolutely up for.

It's a great question, I think a very important one, because one of the key pillars of driving the core domestic market the Grant and the team are focusing on is ensuring that we've got appropriate distribution and ranging on all our core brands. So thank you very much for that.

We have one further question by way of audio from Mr. [ Black ]. Mr. [ Black ], please go ahead.

I guess the next question that I've got really goes to -- and obviously, the exception of yourself, Ari, who's recently joined the company. Just interested about at least -- or 2 directors only have a very small shareholding in the company of 27,000 shares. And Ms. Cook, that's seeking reelection, only holds 15,500 shares. Why should shareholders support the company when the directors don't similarly support the company in their own right?

Mr. [ Black ], thank you for that. I think it's mixing 2, I think, unrelated variables. A person's commitment and support for the company is one thing. Their investment in shares in a company is not necessarily mutually exclusive or tangential to that. I can assure you that Ms. Cook as well as all the other directors are unbelievably committed to this company, dedicated in terms of time, effort, input and involvement. And I wouldn't look simplistically just at the individual shareholdings and their own personal choices as to where they deploy their funds to determine whether they're, in fact, committed to the course of the company, whether it dedicates the company or not.

I think we've got time for just one more question, and then we'll leave it at that. This question is from [ JC Equity, Proprietary Limited ], who asks, is the $8 million to $10 million Dr. LeWinn's inventory write-down excluded from the underlying PBT hurdles for the purposes of STIs? If it is excluded, could you please expand on the rationale for this?

So [ JC Equity ], thank you for that question. At this stage, we flagged that there was a provision that would be made for the -- at the half year for the write-down of the inventory, but there's been no further decisions taken with -- regarding as whether the one-off underlying inventory provision will or will not be excluded from any other factors -- determining factors. It's certainly something that we would engage with our auditors and we'll engage with our Remuneration Committee, but it isn't something that a decision has been taken on at this stage.

Okay. Thank you, Ari. That is -- in fact, there are a couple of very detailed questions there, which I think I can speak safely on behalf of the Board that we'll consider those separately after the meeting. But we have no other questions. So I'll now hand back to you, Ari.

Thank you very much, Phil. And I'd again like to thank all the shareholders for their participation and for their interest in the company and in the performance of the company. And I can assure you that the Board is on the exact same side as you and it is our intention to try and ensure that we get the maximum performance out of this company so that we're able to deliver sustainable, profitable results into both the short and the long term. In a couple of moments' time, I will be closing the polls for the voting system. So I'd like to just give you all an opportunity to either amend, change or cast your votes as you deem fit. I want to make sure that everyone has got ample opportunity to vote because once the polls have been closed, there will be no further opportunity to vote. And so I'll just give a brief pause on the call just to give you a chance to finalize any votes that you may have so -- to ensure that all our shareholders have got adequate opportunity to vote. [Voting]

I now declare that the polls on all resolutions are closed. As I indicated earlier, the results of voting will be announced later today to the ASX and will also be uploaded onto the company's website. Ladies and gentlemen, that is all the business of the meeting. I would like to thank you for participation at this AGM. Hopefully look forward to seeing you in person at next year's AGM. I now declare this meeting closed.