My Food Bag Group Limited (MFB.NZ) Earnings Call Transcript & Summary

Good to go. Great. Thank you, and welcome to our Annual Shareholders Meeting. I am My Food Bag's Independent Chair, Tony Carter. Today's meeting is being conducted in person and online. We are very pleased to welcome those of you participating online through the virtual meeting platform. I'll provide you further instructions as we progress through the meeting, but for those of you attending virtually and encountering technical issues, please refer to the virtual meeting guide or you can phone the helpline on 0800-200-220. Before we formally begin, I'd like to acknowledge my fellow Board members, Jen Bunbury,, who is Chair of our Audit and Risk Committee; Cecelia Robinson, who is Chair of the Marketing Committee and obviously, one of the founders of My Food Bag; Sarah Hindle; Mark Powell; and Mark chairs our Nomination and Remuneration Committee and will be helping chair the meeting during my reelection. We also have My Food Bag's leadership team in attendance including Mark Winter, our Chief Executive Officer; Louise Newsome, our Chief Financial Officer; and Olivia Clark, and Olivia is going to help with the Q&A later in the meeting. Our auditors, EY, are in attendance, represented by Lloyd Banyan, our audit partner, and Lloyd will be available to address any questions regarding the conduct of the audit, we will get to that section of the meeting. Finally, of course, you will notice that we're in the offices of our share registrar, MUFG Pension and Market Services and members of their team are available today to conduct the vote and act as our scrutineers. I have had it confirmed to me that the meeting -- the notice of meeting has been sent to shareholders and other persons entitled to receive it. And I have been advised that we do have a quorum present. So we're all good to go. On that basis, I am pleased to formally declare the meeting open. As always, shareholders are given the opportunity to attend the meeting and vote or to appoint a proxy to vote on their behalf. Proxies have been appointed for the purpose of this meeting in respect of approximately 56 million shares, representing about 22% of our total shares on issue. My fellow directors and I intend to vote all discretionary proxies we have received in favor of the [indiscernible] resolutions that are set out in the notice of meeting. Turning to the agenda. Following my address, Mark Winter will provide a business update before we move on to the more formal agenda items regarding the acceptance of the 2025 financial statements and our 3 ordinary resolutions regarding the reelection of myself as a director; Cecilia Robinson as a Director and a pro forma one around the audited remuneration. We will then have an opportunity for questions and answers. As always, I will encourage shareholders excise the right to vote and ask questions online. You can send through your questions at any time through the online portal by clicking the Ask a Question button, and I'll encourage you to do so as soon as possible as this will allow us to answer those questions at the appropriate time in the meeting. This financial year has seen My Food Bag return to growth, reflecting our unwavering focus on growing active customers by prioritizing convenience, quality and innovation. As more [indiscernible] seek out simpler, healthier meal solutions, we continue to evolve to meet their changing needs, reinforcing our position as New Zealand's leading provider of meal solutions. Our focus throughout the year has been on counting customer experience, expanding our product range and strengthening the appeal of our portfolio of brands. We have made significant strides in developing our offerings capturing operational efficiencies and ensuring that every meal we deliver exceeds customer expectations. During the year, we launched the My Food Bag shop. The shop utilizes our strengths and assets to establish a more flexible operating model, allowing New Zealand households to purchase one-off meal solutions with shorter lead times. The current range features care packages, gifting bundles and ready-made meals, all delivered nationwide. It is pleasing to see the growth in the early stages of the My Food Bag shop and we continue to focus on initiatives to drive awareness and sales for that. The combination of customer improvements in the meal kit business and the establishment of the shop put My Food Bag in a stronger position to capture a larger share of the growing online food market. Throughout the year, free cash flow allowed for further debt reduction with net debt decreasing to $6.9 million at the end of FY '25, and that was down from $11.8 million at the end of the previous financial year. This further strengthens the balance sheet, better positioning the company with flexibility for capitalizing on growth opportunities in the future. While reducing debt, the board also fully remain fully committed to shareholder returns, and we're pleased to declare a fully imputed final dividend of $0.085 per share, bringing the total dividends for FY '25 to $0.015 per share. My Food Bag demonstrated its resilience through FY '25 with strong cash flow generation during a tough economic cycle. Revenue growth, tight cost management and low capital investment requirements have all contributed to this. In FY '26, the current financial year, growth has continued, with sales up 3.8% over the first 4 months of trading versus the same period last year. This has been a pleasing result with the ongoing economic environment remaining challenging. While we remain confident in our ability to manage inflationary cost pressures, we do expect the gross margin for the first half to close below the prior year as our price increases that we have received have lagged -- we have put through have lagged that through price inflation. The Board expects to continue to pay dividends in FY '26 based on the strong cash flow generation. We will provide a financial update when we release our interim results in November. I'd like to finish by acknowledging and thanking all our team at the My Food Bag business for their continued efforts and passion for our business. And I'd also like to thank you, our shareholders, for your continued support. I will now hand over to Mark to do his address. Thanks, Mark.

Thank you, Tony. Antony Carter [indiscernible] welcome. Thank you to everyone here today. It's always nice to meet with our shareholders, and we appreciate this opportunity to provide an update. Today, I'll be outlining the progress and the outcomes My Food Bag has delivered over the past 12 months as we continue to concentrate on our objectives of growing leadership in meal kits and expanding into the wider online food market. Starting with our financial performance. We reported EBITDA of $16.1 million for the 12 months ended 31 March 2025. These earnings were generated of $162.1 million of revenue and reflected a return to growth in the second half of FY '25, building off a stable performance in a challenging retail environment. Our net profit after tax was $6.3 million, 5% up on the prior period FY '24, while free cash flow in FY '25 more than doubled to be $7.6 million. Over the past year, we have strengthened our customer offering and improved operational efficiency, translating into renewed growth and sustained business performance. Some of our key initiatives to support this work, the launching of the -- my food bag shop, one offering one-off purchases and shorter lead times without the need for a subscription, growing appeal in the wider online food market. We upweighted our brand investment, growing consumer awareness and driving active customer growth. We redesigned our user experience and customer buying journey in both our app and our website, increasing personalization and convenience for our customers. We also implemented various procurement initiatives, including moving the sourcing of our produce direct to grower to help mitigate inflation and improve our gross margins. And we further built employee engagement and retention through a positive culture, which increased employee satisfaction scores. With our strategic objectives of growth and lead of growth in meal kits and expansion into the broader online food market, we are focused on growing active customers through offering flexibility, convenience and great value. Central to this focus are 4 key pillars: building our brand to drive higher customer advocacy and loyalty, enhancing convenience for our customers across all our brands to make lifestyles easier such as shorter lead times, faster recipes and growth of ready-made meals. Offering more personalized solutions, so customers have more flexibility and choice to meet their individual needs and introducing new customers and audiences to My Food Bag by unlocking new segments and occasions like the introduction of the My Food Bag shop. These pillars are underpinned by an efficient operating model and ongoing investment and priority into our people, supply chain and data and technology. Our portfolio of brands continues to be a key enabler for us in growing active customers. With My Food Bag, Fresh Start and Bargenbox, we have a strong market presence that caters to a broad customer base. Throughout the year, our strategic pillars are providing a seamless customer experience and personalized solutions have seen us develop our offerings to ensure they align with the evolving tastes, lifestyle needs and dietary preferences of New Zealanders. A highlight for us this past year was My Food Bag's partnership with the New Zealand Olympic team for the 2024 Olympics. This partnership drove passionate engagement with our customer base and beyond. We also successfully reintroduced our gluten-free offering with the support of Celiac New Zealand. In April this year, we launched our diabetes plan with the support from diabetes New Zealand to tackle one of New Zealand's fastest growing health challenges, type 2 diabetes. Bargenbox continues to be New Zealand's most affordable meal kit, offering convenience for more budget conscious consumers. We're focused on product enhancements such as expanding our low carb offerings and continue to demonstrate its accessibility for Kiwi households with a currently 6.3% cheaper than an equivalent online supermarket shop. Freshstart has continued to help Kiwis achieve their weight loss and wellness goals with calorie-controlled, nutrient-rich meal options. We have seen strong engagement with the optional 8-week reset program. Fresh Start also had product enhancements through the year, such as the introduction of new high-protein recipes. During the financial year, we invested in our full user experience redesign and replatform of both our website and our mobile app. This ensures a consistent and seamless experience for our customers while they navigate our expanding meal range, whether they're using our mobile app or our website. As a business, we continue to embrace new technologies, such as artificial intelligence, to drive both customer experience improvements as well as productivity gains. We also continue to expand our delivery network by opening up more than 7,000 new addresses and introduce new delivery windows to provide our customers with greater flexibility. Our focus on customer experience across the board has resulted in multiple areas of improvement. For example, our Net Promoter Score was up 7 percentage points year-on-year, and customer compensation continued to trend down. As Tony touched on in his address, we were excited to launch the -- My Food Bag shop in late November to target new audiences and unlock new segments and occasions. The shop currently offers one-off ready-made meals, foody gifts, meal solutions and care packages for existing customers as well as attracting new customers who want a one-off purchase without a subscription. The shop further expands our offering into the wider online food market, utilizing our existing network and platform and leverages our strong brand credentials. This new flexible operating model allows us to reach a broader audience, including corporate clients and provides a great level of convenience with deliveries being made nationwide within 48 hours. The shoppers received great feedback from customers, particularly for our fresh, ready-made meals and seasonal products. We continue to enhance the shop offering, digital experience and communications through FY '26. Our operational excellence program continues to drive efficiency across our operations, which results in better customer experience, and we can see this through our Pick accuracy and delivery metrics. From an environmental impact perspective, we've continued our efforts towards circular packaging solutions, including transitioning to suppliers from cardboard to reusable crates for ingredients delivered into our distribution centers. In November 2024, we also hosted our inaugural supplier awards where we celebrated with awards in 3 categories of quality excellence, service excellence and innovation. In FY '25, we also continued strengthening our culture and capability for the future, and this shows in our strong employee engagement score. Our commitment to our people was recognized when we won the 2 degrees Supreme Employer of the Year Award in Auckland in April this year. We've also continued to support our community through our supported life and Auckland and skill wise and Christchurch, which helps provide opportunities for people with learning disabilities. As we are moving well into FY '26, we continue to make great progress and deliver on our strategy. Some examples of recent activity includes for Bargenbox, we've launched our Bargain wind campaign with a strong focus on value, affordability and quality while continuing to highlight the savings compared to an equivalent shop at the supermarket. With My Food Bag, we have continued to build on our strong connection with Nadia [indiscernible]. With new seasons of Nadia's Farm Kitchen along with continuing to run the dinner dumber advertising and the highly successful dinner with Nadia [indiscernible]. With the recent arrival of GLP-1 weight loss medications into New Zealand, we have launched our GLP-1 support plan under our Fresh Start brand to help New Zealanders eat well and stay nourished while they are taking these weight loss medications. We have also further built out our diabetes plan from launch. And in the My Food Bag shop, we continue to invest in raising awareness and meeting new occasions with our product range, including our high-quality ready-made meals, which consistently receive very high customer feedback ratings and NPS scores. And wrapping up, as we progress further into FY '26, we remain focused on continuing to build on the results of the past 12 months, concentrating on growing active customers and delivering growth and innovation initiatives aligned to our strategic objectives of growing leadership in meal kits and expanding into the online food market. I look forward to providing an update on our progress at our interim results in November. Thank you, again, shareholders for the opportunity today and for your continued support. Thank you.

Thanks, Mark. We now come to the more formal part of the meeting, which is the resolutions. And the first resolution is to formally receive and consider the annual report for the financial year ended the 31st of March 2025. And including the financial statements, the auditor's report, et cetera. Copies of the annual report have been made available to shareholders before the meeting and available on the investor website. As a reminder, there will be an opportunity to ask general questions shortly. However, this is the opportunity to ask Christian specifically on the financial statements, the auditor's report and the company's 2025 annual report. Can shareholders present in the room, please wait until the microphone has provided to you. It's important because the people online have got to hear you and clearly state your name and whether you're a shareholder or a proxyholder. Are there any questions from shareholders in the room in relation to the financial statements. I am not seeing any. Are there any questions online Lou?

No questions online.

Okay. We'll then move on to Item 4 on the agenda, which are the resolutions. And the first resolution relates to the reelection of myself. The second one, the reelection of Cecilia and the third one is the approval for the directors to set the auditor's fee. A poll will be held on each resolution and each resolution is required to be approved by an ordinary resolution. That means that it's a simple majority of the votes cast by shareholders entitled to vote. Shareholders will be able to cast a vote either in person or online. Shareholders joining us today, you would have been given your shareholder voting card. If you're a shareholder and did not register on arrival and wish to vote, please make your way to the registration just outside this room for assistance. Please you mark your voting intention for each resolution and the voting cards will be collected close to the conclusion of the meeting. Shareholders voting online will be able to cast their vote using the electronic voting card. To vote, you will need to click get voting card within the online meeting platform. You will be asked to enter your shareholder or proxy number to validate. Then please mark each of your voting cards in the way you wish to vote, which is for, against or abstain on the voting card. Once you have made your selection, please submit -- please click submit vote on the bottom of the card to lodge your vote. Voting will remain open until 5 minutes after the conclusion of the meeting and the results of the polls will be announced after the meeting on the NZX platform. Resolution 1 relates to the reelection of myself as a director. I will hand over to Mark Powell, Chair of the Nominations and Remuneration Committee to chair this part of the meeting. Mark.

Thank you, [indiscernible]. So Tony joined the Board of My Food Bag in January 2021 and was appointed chair at that time. He has a broad range of experience and governance across the consumer, industrial services, infrastructure and energy sectors. Tony moved into governance following a successful executive career where he served as Chief Executive and Managing Director of Food [indiscernible] for 10 years. Tony is currently Chair of Datacom, TR Group, the Interiors Group and the Skin Institute and also sits on the Board of Ravens down and the warehouse group. He was formerly Chair of Air New Zealand for 6 years, Chair of Fisher and Pike Health care for 8 years, a director of Fletcher Building for 9 years and a Director of ANZ Bank of New Zealand for 10 years. In 2020, Tony was made a companion of the New Zealand Order of Merit for services to business governance. Tony Carter retires and being eligible, offers himself for reelection. The Board recommends -- I probably understates it. The broad totally recommends Tony Carter to you as a Director of My Food Bag and unanimously supports his reelection. I invite Tony to address this meeting now on his proposed reelection.

Thanks, Mark. I want to say a few words to ask for your support for reelection to the Board of My Food Bag. Mark has already detailed my background, so I won't repeat it. I joined the Board of my food bag in January 2021. The reason I joined was I believe in the business and felt it had a great future. I still do. I am aware that many shareholders feel disappointed by the share price performance since we listed, and I share that. However, the business model was new and untested in a post COVID environment and also how the business would react to a recessionary environment. When demand started to soften in 2022, the Board and the management work to rightsize the business and we're seeing the benefits of those actions. We have been consistently profitable, and it's wonderful to see the business back in growth. I believe we have an excellent Board that has a range of skills and experience at appropriate for My Food Bag. I continue to be excited by this business and the opportunities we have, and I ask for your support for my reelection. Thank you.

Thank you, Tony. So I move as an ordinary resolution that Tony Carter, who retires at the annual meeting and is eligible for reelection, be reelected as Director of My Food Bag. Are there any questions from the floor on this resolution? As we did last time. Firstly, we'll look for questions in the room. One question?

My name is [indiscernible] the shareholder. Regarding Page 64 of the annual report, I'm not too sure why it's not available that you attend any of the marketing committee meeting because you are an independent chairperson, yes, I'm not too sure the reason why that's the case for.

The Marketing Committee was set up specifically to help management with marketing matters. It's a sort of a functional committee that has a lot of marketing expertise with Sarah and Mark and Cecilia. I don't think I can add a lot of value. It's not my strength is marketing. And I think the committee works better in a smaller group to be able to assist management with the marketing of the business. So that's the reason I don't attend.

Any more questions in the room? One question here.

Thank you. Good morning. Roger Clark [indiscernible], I'm shareholder. Just a question for you, Tony. The share price is currently less than 1/7 of where the company floated just over 4 years ago. Is there anything you think you can do better going forward than what you've done in the last 4 years since the company listed.

I think there's always things you can do better, and we strive for that every day. It clearly floated at a very optimal time for the exiting shareholders. I mean that's -- it was coming out of COVID. And like a lot of businesses have got a big lift from a COVID environment that we thought at the time might be a permanent change. And we've -- obviously, our deliveries are less than what we were doing during that time. I think we are where we are, and we've got to do the best with what we've got. I think it's pleasing that the share price is up, what, over 40% over the last 12 months. So there is some positive movement in the share price over the last 12 months. But I can't wave a wage at Mont and get it back to what it was at the IPO.

Any other questions in the room? So I'll check with Olivier at the back. Any questions online?

No questions on this matter. Thanks, [indiscernible].

Okay. Well, there's no further questions from the shareholders online. I think now it appears to be none. I'll hand back to Tony as Chair, and we'll move on to the next case resolutions. Thank you.

Thanks, Mark. All right. Resolution 2 relates to the reelection of Cecilia. Cecilia, cofounded My Food Bag in 2012 was co-CEO until 2018 and serves as a Director of the company prior to its public listing in 2021. Cecilia has significant institutional knowledge about My Food Bag, entrepreneural background and innovative drive complement the existing skills of the Board and have helped support My Food Bag for a challenging period and see the business return to growth. Cecilia is also Founder and Co-CEO of TentHealth and is a member of the Institute of Directors and a Board member of Pie Funds. Cecilia has been recognized for her contributions to business and entrepreneurship with several awards, most recently as the New Zealand Innovator of the Year Award in 2024, Supreme Winner of the 2017 women of influence awards, Mix Magazine's businesswoman of the year 2014 and the EY Entrepreneur of the -- Young Entrepreneur of year in 2013. Cecilia retires and offers being eligible office itself for reelection, and the Board again unanimously and strongly recommends Cecilia to you as a Director of My Food Bag and supports her reelection. Cecilia.

[Foreign Language], everyone. It's a pleasure to speak with you today and to put myself back for reelection for the Board. For those I haven't met, I cofounded My Food Bag and have returned to the business post the IPO, and I'm currently co-CEO of Tenda Healthcare. I'm deeply personally invested in My Food Bag's success and remain confident that the value we've built will be recognized over time. It's been great seeing My Food Bag regain momentum, and I'm proud of the progress that we've made in particular over the last 12 months. A personal highlight for me has been cheering the marketing committee, where we've worked to really sharpen our customer proposition, our brand experience and then reinvigorating the brands. while we've made strides, we still have work to do in involving with our customer needs, building loyalty and delivering on long-term value for our shareholders. I extend my thanks to our leadership team, for their dedication to my fellow Board members for their guidance and support. It's a privilege to work alongside you all. Thank you.

Thanks, Cecilia. I move as an ordinary resolution that Cecilia who retires at the annual meeting and is eligible for reelection, be reelected as a Director of My Food Bag. Are there any questions from the floor on this resolution? I am not seeing any. Are there any questions online Olive.

No questions on this matter online.

Cool. Okay. We will now move on to Resolution #3, which is the auditor's remuneration. This is a procedural resolution that you'll see at all annual general meetings. The current order of My Food Bag we automatically reappointed at this annual meeting under our governing legislation. There is a requirement for the auditor's fees and expenses to be fixed at the annual meeting or in the manner that the company determines at that meeting. Shareholder approval is therefore sought for the directors of My Food Bag to fix EY's fees and expenses for the ensuring financial year. The Board unanimously supports this resolution and recommend you become favor of it. I now move as an ordinary resolution that directors of My Food Bag be authorized to fix the fees and expenses of the auditor of My Food Bag for the ensuring year. Are there any questions on this specific resolution. [indiscernible], no.

No questions online either.

Okay. At this time, I'd like to advise the outcome of the proxy votes that were lodged in advance of the meeting on those resolutions, and they are shown on the screen. For those shareholders online, please note that you can continue to submit your vote online if you have not already done so, and voting will be open until 5 minutes after the conclusion of the meeting. For shareholders in the room, members of the MUFG Pension and Market services team will now move through the room and collect your voting cards, and I see them coming around. So that will be great. That then leads us on to general business. And I'd like I like to invite shareholders the opportunity to ask questions whether in relation to the presentations given today, the annual report, management of My Food, just basically anything you want to ask. Shareholders online can continue to provide questions through the portal, and we will also questions from the room. When I call for questions, can shareholders present in the room, please use the microphones provided and clearly state your name before asking the question. I ask in the interest of fairness to all shareholders attending this meeting that anyone wishing to ask a question, does so in a concise manner as possible and be considerate to other shareholders wishing to ask questions. I will endeavor to answer your questions myself or probably more appropriately direct them to Mark. Moving first to a question that has been submitted in advance of the meeting. And the question is from Edna [indiscernible] does Board consider the share price undervalues the company? And if so, has consideration being given to us buyback performance. I think that the market will value the company, and it's very hard for the Board to express a view as to what the fair share price should be. I did note in my earlier response to a question, the share price has materially increased over the last 12 months, which is pleasing to see. And I think that is a sign that the market is is getting more confidence in the company, which is great. In terms of a share buyback, we have considered. However, I'd make a couple of points. Firstly, the company does have surplus imputation credits and the most tax efficient way to distribute surplus funds from the company is by and fully imputed dividend, and we are obviously doing so. And the second thing is the evidence on share buybacks is pretty mixed. In the past, there are several companies who have bought back shares while it provides some short-term sugar hit over time, it does tend to go back to the true value, underlying value of the company. So at this stage, it's not something that's under active consideration. Okay. Questions from the room? Sir.

Richard [indiscernible], shareholder. I've just been looking on Trustpilot, where your reviews of 3.8, which is hardly stellar. The most recent review, which I can show you, which was posted today, is the customer who changed their address and contacted My Food Bag a week before the parcel was to be delivered to get the parcels sent to the right address. And My Food Bag said, nothing could be done and the parcel went to the wrong address, and the food was presumably wasted. Hardly, right customer engagement. I can show you the review if you're curious.

I'll ask Mark to respond to that because it's probably more of a management [indiscernible].

Happy to follow up on the specifics of the customer. From our perspective, we obviously look at our customer feedback daily and weekly, and we've continued to see it trend up. So our customer satisfaction scores and our Net Promoter Scores continue to be positive year-on-year. With regard to flexibility around deliveries, we've -- our policies allow customers to make changes post subscription commitments usually within 24 hours. So the fact that this occurred a week before the delivery seems like an exception, but more than happy to follow up on it.

Perhaps [indiscernible], if you got any questions online?

Yes, we've got a couple of questions online. We've actually had a couple of questions in relation to food price inflation and managing margins. So I'm just going to take a representative question on that. Given food price inflation, do you have any plans to increase the price of your products in the next year to match inflation?

Mark?

Yes. So food price inflation obviously is impacting all of us, including My Food Bag. And as a business, we have a number of considerations that go into how we set our price, including the cost of inputs like food. We think about not only those input costs, but we think about the associated value of our product that we're offering and all the other kind of features associated with it. We're tracking food price inflation very closely. We're working very closely with our supplies, both in terms of actual and sort of forecast movements. And so as we have to date, we'll take action where it sort of makes sense to increase prices.

It's probably worth noting we did walk through a modest price increase on the My Food Bag from the beginning of July.

My name is [indiscernible] again, the shareholder. I have 2 questions. The first one is, have you considered Food delivery by zones. So those privates planes or aircraft or, for example, or those driverless vehicle and those more of the higher tech products? And then my second question is regarding the employments and diversity, do you have to practice man band in order to show a very good diversity according to the answer extended.

The first question in terms of drones, I think it's too early in a New Zealand context, it's not something that we're actively investigating today. There are obviously some pilots of people like Amazon are running, but they have slightly deeper pockets than ours. So something that, again, I suspect in a decade's time, it would be different. In terms of diversity, perhaps I'll throw that one to Mark as Chair of the committee.

In terms of diversity.

Yes. Do we discriminate against [indiscernible], I think is the question to make our numbers look good. The answer is no.

Well, yes, [indiscernible] I was wondering about the question. We certainly don't. Otherwise, I don't think myself or Tony would be sitting here either. Look, diversity is important, and we treat it seriously, but we don't treat it in a way that does it just get numbers that make us look good. It's about the performance of the company. It's about helping people achieve their potential with no unconscious bias getting in the way. And that's -- it's applied very practically in this company and applied well to make sure that we're looking at are there any data that suggests that there may be anything that is not -- is getting in the way of people achieve their potential, and that's how we apply it. But we certainly don't discriminate against [indiscernible].

Okay. Thank you. Do have any questions online?

Yes. So this question is from James Davis. I'm [indiscernible] customer and a HelloFresh customer, when [indiscernible] fresh recipe includes 1 cup of corn, [indiscernible] with My Food Bag, I receive 0.5 kg of corn for the same 1 cup requirement. This is an example, but the same happens of [indiscernible], pastas, noodles, et cetera. This is great for the customer. But as a business, are we providing more food than what is being paid for would a supply chain more like HelloFresh save us money?

The reality is in that specific example around corn and Ps, it actually works out cheaper for us to source a bigger volume and provide the customer with more than it does and individually proportionate. So that's the case. We get a lot of positive feedback about the fact that, in general, my food back across all of its brands, the volume and quality of the meals that are provided are usually a lot bigger than what people expect. So Net-net, we see this as a really positive thing. But procurement opportunities and getting the right portion sizes remains still central to what we do, and you can see that in the range of other ingredients we provide, including sources and dry goods and so forth.

My name is Yuri Saltz, shareholder, and sorry for my lateness, I'm not sure if I missed -- as I missed the part, if you commented on current trading, a few months and have come along and maybe you can comment on that as deep as you can.

What we said earlier in the meeting is that sales year-to-date are up 3.8% for the first 4 months of the year. And the other guidance we gave was that our ingredient margin is under pressure due to food price inflation, which we just talked about and we anticipate that our margin for the first 6 months of the year when we report will be below last year. That's the guidance we've given. And I really can't give any more, I'm sorry.

The second one is on yesterday, Google New Zealand or Auckland and then food kits. And your company came up with number 6 I think, with UP and other ones before. And is that normal? And is it actually important?

It's really important, and it's not necessarily normal. I don't know exactly what you Googled and what that looks like. But from our perspective, we drive a lot of investment into what we describe as search engine optimization, SEO. And we do that across all of our brands and all our various products, obviously, to promote our products to the top of the likes of Google and other search engines, obviously, to drive conversion.

And lastly, you [indiscernible] -- I'm a pretty young shareholder, but from Germany, I know HelloFresh, there in the market very well. So have you actually disclosed your market share in a certain stage?

No, we didn't -- and I'm not sure that, that's widely available. I mean there's no real data -- published data around market yet. I think it's fair to say that we believe we've increased data. HelloFresh are our main competitor, and they release their reports every 12 months on the company's office website. We look at those. And they declined quite materially in the last reported results. So here, but I can't -- we don't have the data ourselves.

Look, at the end of the day, we're playing a pretty wide online food market. So when it comes to the definition of that, not only we're talking about Hello Fresh. We're talking about a range of players with the likes of Woolworths and New World and a number of others that are in there as part of that. Tony's point is that HelloFresh specifically, we've not seen their numbers for now close to 18 months in terms of their filings. So a very much out of date. But specifically, the last time they filed in a relative sense, they set at a lower market share or a lower revenue than what we're turning over at that point in time.

Well, another last one, please. What about market dynamics? Is the market relatively rational at the moment? Or do you see some irrationalities regarding pricing or how aggressive some players are.

Our observation of the market is that it is rational at Prison and has been probably for the last 12 months and that all of the participants in the wider market have more standardized type offerings out there to consent consumers.

Thank you. Perhaps we'll go to Olive and ask question and then we'll come to you.

What considerations have around offering alcohol into the product mix have there been? I suspect this has been considered, however, to state it against I'm interested to hear any feedback on this. This is a question from Jeffrey Henderson.

Could you just repeat the question? I couldn't get it.

What considerations around offering Alcoa into the product mix has there been? I suspect this has been considered, however, decided against. I'm interested to hear any feedback on this.

Yes. Look, we certainly recognize the alcohol and wine and beer often is a nice pairing with meals. And so in many respects, as an adjacent category that certainly holds some appeal. We have piloted offerings in the past. But what we've seen is that we have seen very limited uptake in conversion. In fact, we found that a lot of New Zealanders are very particular with their wine -- and so offering a sort of generic -- redo a generic with doesn't necessarily hold appeal. So there's a whole lot of complexity as well, obviously, from a supply chain perspective around offering alcohol. So look, it's not something that's immediately on the horizon for us, but certainly long term could present an adjacent category opportunity.

Barbara [indiscernible] from the New Zealand Shareholders Associated also an individual shareholder. I guess my question is similar to that about the customer growth. I noticed the increased figures in the last 12 months. To me, they look quite modest. Do you think that's come from your new product range or do you think you're taking that away from competitors?

That's a good question, and the reality is it's a bit of both. I think we're probably taking share. And at the same point, we know through a lot of our new products that we've developed, so the likes of our gluten-free offering or our diabetes plan. That has also introduced new people to My Food Bag that allowed us to grow as well. In terms of our customer base, I think one of the things that we've put a lot of effort into over the last 18 months is about improving the overall health. And by health, what I'm talking to is the frequency or the number of orders that individual customers are taking, and we're seeing that increase. And then the other point is the amount of money that customers are spending with us in terms of their average order value or transaction value. And again, we're seeing that increase. So -- those are sort of important drivers in addition to customers supporting our top line.