Oceana Group Limited (OCE) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, management, staff, directors, analysts, invitees, and all other shareholders and stakeholders who have joined us virtually this morning, I am Mustaq Brey, the Chairman of Oceana. And thank you for taking the time for being here with us this morning. I have great pleasure welcoming you to the financial results presentation of Oceana Group for the financial year ending 30th September 2023. Let me congratulate the team for -- the management team for delivering a very good set of results, which was released this morning on SENS, the details which will be explained during the presentation. These results are testimony of the performance of the Group with solid leadership, a Group that is diversified and operating in multiple geographies across the world. These results witness to a Group which has deep roots of over 100 years, mature with collective experience, nimble and agile enough to adjust to a rapidly changing global environment. As was announced on SENS this morning, we are excited that Neville Brink's tenure as the Group CEO was extended to 31 December 2026. Neville, thanks very, very much for that, and we look forward for your leadership over the next number of years. I'm confident that his visionary leadership and experience will continue to provide this ability to execute the Group's strategy and drive performance for the benefit of all stakeholders. Neville has galvanized a strong executive team that has led from the front and emerged successfully from the recent periods that presented the company with many challenges, and it wasn't very pleasant for me to be speaking to you during that time, but I'm very happy to be here today in a much more pleasant environment. Congratulations to the entire management team. These results speak for -- speak to hard work, diligence and careful execution of strategy in an increasingly risky environment. Since Oceana Group's primary operations are in South Africa, I'd like to reiterate concerns also raised by other institutions and organizations in corporate South Africa. We need to expedite solutions to our energy crisis. The loss in productivity, as we all know, has a very broad impact in every sector. More notably on jobs, you can least afford. South Africa needs a growing economy to enable new jobs. We have widely read about the failure of the state-owned enterprises or the South African economy to grow unfettered. We need a logistic network of roads, harbors, rail and air that operates efficiently. I am concerned that the current situation at Transnet and request government and Transnet to act swiftly to avert a potentially bigger crisis. Our ports are critical in the country's economic activity. This country can ill-afford this becoming a bigger problem than it already is. I wish that one day the whole world will live by Oceana's philosophy of positively impacting lives. I thank you for your indulgence and I hand you over to Neville Brink and Zaf Mahomed to proceed with the presentation. Thank you.

Welcome, everybody. It's actually nice to see some people face to face. You'll notice a little goody bag there. That was a bribery to get you to come and actually -- early on a Monday morning and come and join us here. But it's really nice to see you. We've also got people virtually. Obviously, the management team -- Oceana management team from around the world are also online. And I hope the U.S. contingents are listening. I think it's 2:00 or 1:00 in the morning there. So hopefully, [indiscernible] are actually wide awake, I'm going to test them afterwards to see if they were actually listening. But it's very, very nice to see you all. And a thank you to Mustaq and the Board for that vote of confidence in extending my contract. As you know, I'm passionate about fishing, I'm passionate about this Group, and I'm passionate about the staff that work at Oceana. So this is not a burden for me. My wife is very happy that I'm staying at work. But no, I'm very excited. Obviously, the strategy that we put together in the last 2 years, and you'll see some in the presentation now, it's going to take 3 years to put together, and there's some investment that we need to do in our factories and in our vessels, it's going to take time. And I want to see that through to the finish. So it's going to take a lot of hard work from this team, but we're on the right journey. So I'm very excited. So let's get into the presentation. I'm going to cover a couple of slides at the beginning, and then I'm going to hand over to Zaf to do the financial reporting. And then I'll take you through some of the operational issues that drove our performance this year. And then we'll end with a little bit of an outlook, in terms of what is -- what we can see for the next 6 months. And then I'll kind of end off where -- in terms of the strategy, where I want to see this Group go for the next couple of years. So what I want to do is -- and I know you've seen this slide before, but it's a slide that I developed -- a structure that I developed and have been pushing hard over the last 2 years. And it's around how this Group is actually operating and the strategy driving. Each of these businesses have a clear defined strategy. Obviously, it's supported by Group and it's underpinned by Group, it's driven by Group. But they're very different businesses, very different businesses in terms of the way they're run, very different business in terms of the key strategy. Again, just a high-level overview of where we are. We operate in 5 fishing geographies across the world, 36 customer geographies. About 50% of our revenue is in the stated countries, obviously, Lucky Star being the biggest one. But horse mackerel, some of the hake goes into the southern countries. Then in North America, that 15% represents the pet food market that the -- that our fishmeal goes into. In Europe, obviously, the fish oil is our -- the Scandinavian salmon farm is about all our fish oil, big market. But also all of our hake, squid, Kingclip, monk goes into the European market. In the Far East, obviously, lobster and aquaculture. A big driver of our revenue is the aquaculture industry in China, and Thailand, Malaysia, where we supply fishmeal into their farms. A little bit in Australia, which is hake. And then in Africa, the further part of Africa, a lot of our horse mackerel goes, in particular, in West Africa, Nigeria, DRC. We operate 33 vessels across the world, from a small little lobster vessel that's 12 meters long, has a crew of 6, to major midwater trawler that's 110 meters long, has 120 people onboard, full, almost like a cruise ship, that stays out to sea at a month at a time. So a wide range of vessels and factories. We've got 5 factories around the world. And we have employed just over 3,500 people. So a very diverse group in terms of geographies, currencies, species and markets that we're sold. And that is the strength of Oceana. And if you look at the performance this year, 2 of our businesses did extremely well, and one business struggled. It had some upside. But that's the beauty. We're not in one particular species like some of our competitors, that if that species doesn't do well, they suffer. Now hopefully, all of them will fire at some point together, and hopefully none of them will not fire together as well. So it's part of the strategy. And we will continue. And it's certainly some of the things we're looking forward is to continue that diversification strategy. Where else do we go within the context of what we are as a fishing company? When I was thinking about this presentation, I said, what are the key things that drove the performance this year? And I think these are the -- I'll try to highlight the 5 key drivers of the performance. Firstly, the performance of Lucky Star. And this is really a phenomenal performance, due to Lawrence and his team, and he's sitting there, in an extremely difficult environment. If you look at most of the performances of FMCG companies in this country this year, they've all seen massive drops in volume, and they've seen drops in margin. So it's been very difficult to drive a volume strategy with a constrained consumer. And that's what we see in this country. Consumers have -- are really struggling. And we're now -- when we spoke last year and when we said, what are we going to do? The key was to drive volume, but the only way you can drive volume is to maintain pricing. So we've worked very, very closely with the trade, Lawrence, in terms of managing the trade and our sales margin. When you're on an everyday selling price, normal selling price, you try and make sure that the trade don't take excessive margins. When you go on promotion, you go deep, and they put in and we put in. And it's been very, very effective. So we've seen a 9% growth in volume in Lucky Star, unusual, you'll see some stats just now about what they've done, with an acceptable drop in margin. We have taken a bit of a margin drop, but it was an acceptable. We accepted the number of 8.9% operating margin. If you look at some of the other FMCG companies, you see much bigger drops in margin and they've taken a knock in volume. And that's where we will continue. How do we increase the consumption of cultures? Make it a wider consumption, eat more frequently, and extend the brand, the Lucky Star brand, not only in canned fish but outside of canned fish, and I'll talk a bit about that. The second driver of the performance was obviously the fish oil price, phenomenal fish oil price. But that -- and we can't take credit for that. That happened to be circumstances that led to a shortage of oil worldwide. But what we did do well is we made sure we had the stock. So we spent a lot of money, and hopefully, Bjorn is listening, but his team there in America really spent a lot of time over the last year making sure that, that plant operated at an optimal level. We fish and process for 7.5 months in the year. That cannery -- sorry, that fishmeal plant operates at 120 tons an hour, 7 days a week. We switch off at about 4:00 on a Sunday, and we clean the plant, and we're back up running 8:00, 9:00 on a Monday. And that goes for 7.5 months flat out. They produce, they process 200,000 tons of fishmeals through that plant. And in the 7.5 months, they had a total of 18 hours downtime. Now we couldn't have taken advantage of this pricing if we hadn't done that. And that's the key. When there's fish -- and I always say you can't contract with the sea. When there's fish, you need to maximize it and turn it around in that plant. And some of the work we're going to do with Suleiman's businesses in the fishmeal and oil is do exactly what we did in Daybrook, drive that throughput. So that's the second point. On the wild-caught side, tough year. But what was positive was that there is a strong demand for seafood worldwide. People are becoming more health conscious. They want sustainable, particularly sustainable, the whole ESG drive, that you are catching on a sustainable basis, that you're not depleting the resource. So across the board, in all of our species, we're almost at record prices, whether it be hake or horse mackerel or Kingclip, or squid, the prices as said have -- offsets some of the negativity with catch rates, and I'll talk a bit about catch rates in wild-caught now because they had a tough season. Fortunately, the pricing mitigated some of the increase in costs driven by poor catch rates. The fourth area is all about inventory management. And you say that -- you can say that's a standard thing, all companies should manage inventory properly. But we made a conscious decision, because of the nature of our fishing and the nature of -- it's not something you can go and buy off the shelf. You have to plan that when there's fish, you can buy it. So there are 2 areas we focus on. One was in Lawrence's business, where we said, remember in 2021, we came through that looting period, we had low stocks. We had to drive up. And we spent -- and it came at a cost of working capital. We put a lot of stock into the system. And we opened the year with 3.2 million cartons. That's about 4 months stock. And that allowed us to drive that volume strategy, because we knew we had the stock. The trade -- trade don't want to invest in something if you're going to run out of stock. They're prepared to invest because they know that pulls people through their stores. So that focus has been in the stock management. And we've done it again this year. You'll see the figures later in terms of what we're opening this year with. And the second one was on the Daybrook side where we had very good catches, we carried stock forward. And remember, our customers in Daybrook are not spot buyers. There are 2 main buyers. One is the petfood market in the U.S., and they buy consistently. They plan their production, Blue Buffalo, one of our big customers, buys 4,000 tons of fishmeal every month. He wants to know he's got 4,000 tons. If we do not carry stock across from one season to the next, remember, we're closed from November to April, he runs out of stock, he then will come up with a new formulation, which means he takes fishmeal out of [indiscernible] product and finds an alternative protein, whether it's soya or bone meal. Once he does that, very hard to get back. So that is key for us to carry that stock and give him. The salmon farmers, there's been a massive growth in salmon farming throughout the world. Salmon has become very popular. It's farm salmon. It's relatively inexpensive. And you've seen sushi has become worldwide. And those salmon farms have just grown because -- and we're supplying those farms. And again, those farms buy oil from us because there is no alternative. The higher omegas that we have in our oil in menhaden and anchovy aren't replaceable. So they need those on a regular basis, and they get -- it's to do with the health of the fish and the growth rate of the salmon. So again, we held stock at the end of last year to supply them into the new season. And that -- the numbers came through. And then obviously -- and Jeff will talk a little bit more about this. He's managing our balance sheet. Obviously, we've seen a number of companies that have -- given the high interest rates, that are suffering with high levels of debt. And we've made a conscious decision to pay down some of that debt, both in the U.S., because of this windfall on the oil price, and in the sale of the CCS. So that all went out and you'll see our net debt to EBITDA levels have come down. So those are the key drivers. I'll go into a lot more detail after Zaf's presentation, but I'm going to hand over to him to take you through the numbers. Thanks, Zaf.

Thank you, Neville. It's a lot better to stand up here with a good set of results, compared to the company that I came from. Less said about that, the better. Oceana has continued with its strong performance from the second half of last year and the first half of this year despite the tough trading environment. The numbers presented exclude CCS Logistics, which was sold in April 2023, and has been treated as a discontinued operation. Detailed financial statements have been included in the appendix to this presentation and the results booklet, which is available on our website. Revenue from continuing operations increased by 23% to a record ZAR 10 billion. There was strong demand for affordable protein. So I need to move the slide. Apologies. There you are. I'm not going to start again. I was practicing talking to my microwave last night. Revenue from continuing operations increased by 23% to a record ZAR 10 billion. There was strong demand for affordable protein and improved pricing across all products, particularly fish oil, as well as the effect of the weaker rand exchange rate on export and U.S. dollar translated revenue. To put this increased demand for protein in perspective, Lucky Star sold approximately 240 million cans in the SA market, which is equivalent of about 650,000 cans a day. Operating profit of ZAR 1.5 billion is the highest since 2016, our previous highest operating profit. This was driven by 39% profit growth of our U.S. business, Daybrook, which delivered a record ZAR 810 million, exceeding last year's high of ZAR 584 million. The U.S. contributed 56% towards operating profit for the Group. Headline earnings per share was up 29% to $8.088 per share, supported by higher U.S. earnings, which is taxed at a lower rate, as well as the benefit of lower interest on debt. A final dividend of $3.05 per share has been declared, bringing the total dividend for the year to $4.35 per share, an increase of 26% on the $3.46 per share paid last year. The significant improvement in the Group's net debt-to-EBITDA ratio from 1.7x to 1.2x is pleasing given the current high interest rate environment in both countries, which provides capacity to grow as well as fund future CapEx. On a 5-year view, you can see the advantage of having a diversified business is evident in the consistent and significant revenue and operating profit growth, particularly over the past 3 years. This is primarily as a result of investment in the business to benefit from the continued strong demand and pricing across our product range, together with improved inventory levels. We have had 2 consecutive years of strong performance from Daybrook. Although it only contributes 27% of revenue, it now constitutes more than half of our operating profit. The contribution of the U.S. business has grown from 33% to 56% over the past 5 years. Our operating profit margin, which was impacted by cost pressures in South Africa and offset by Daybrook's performance, remains healthy. The benefit of the diversification across species, geographies and currencies enabled the Group to absorb the impact of increasing input costs and remain resilient in a challenging operating environment, particularly in South Africa, which place consumers under increased pressure. Operating profit grew 20%, driven by record earnings of ZAR 810 million from Daybrook. Although margins were under pressure in Lucky Star, it was still able to grow earnings by 4% to ZAR 496 million, benefiting from its focus on canned fish volume growth and strong commodity prices for fishmeal and fish oil in the Africa business. The wild-caught business contributed ZAR 127 million. And following the commencement of our vessel upgrade program, is now better placed to take advantage of firm demand and pricing and expected improvements in catch rates. It is worth noting that the full impact of rising input costs in the canned fish business was not passed on to consumers as we adopted a strategy to maintain affordability, as mentioned by Neville. Margins were also negatively impacted by lower catch volumes and fish oil yields in both the SA and the U.S. fishmeal and fish oil operations. In addition, we had poor vessel utilization and catch rates in our SA hake and horse mackerel fleets and costs directly related to low [cheating] in our SA land-based operations. The Group disposed of its interest in CCS Logistics with effect from April 2023, and realized a profit of ZAR 477 million before tax, which is excluded from headline earnings per share. Net interest expense increased to ZAR 192 million. However, excluding interests related to lease liabilities of ZAR 38 million, the net interest expense reduced to ZAR 154 million compared to ZAR 168 million in the prior period due to term debt repayments during the year. The interest expense was adversely impacted by unhedged interest rate increases, the translation of U.S. dollar interest at a weaker rand exchange rate, and higher SA short-term borrowings to replenish inventory levels. The decrease in the effective tax rate was due mainly to the mix of higher U.S. earnings, which is taxed at a lower rate than SA earnings. Neville mentioned working capital. This is a key part of our business. Canned fish, fishmeal and fish oil represents the bulk of our inventory holdings. A large proportion of supply into our business is cyclical, which requires the maintenance of appropriate inventory levels and active working capital management throughout the year to meet demand for our products. Reported results in previous periods have been adversely affected by lower inventory levels, post-COVID supply chain disruptions, and the KZN civil unrest. As a result, we embarked on a program to build inventory during the prior year. This strategy will hold us in good stead, particularly considering the port challenges currently being faced in SA. Without the need to rapidly replenish stocks of raw fish in the current year, we were in a much better positioned to negotiate terms with our suppliers, with creditor days increasing from 55 days to 67 days. Lucky Star's working capital increased year-on-year, having reached optimal stock levels to meet growing consumption and to mitigate cyclicality of supply. Daybrook continued with its strategy of building stock during the fishing season to meet off-season contract commitments to May 2024. From a capital expenditure point of view, during the past 2 years, we invested significantly in optimizing plant throughput and vessel utilization in the U.S., which has been a major contributing factor in our ability to benefit from record prices. We invested a further ZAR 37 million before the 2023 fishing season, which contributed to our ability to achieve production rates of over 120 tons per hour with only 18 hours of downtime. In South Africa, we invested ZAR 54 million in our canned fish and fishmeal production facilities, and ZAR 61 million on the construction of the new canned meat facility, both on the West Coast. The new canned meat factory in St. Helena Bay has been commissioned in the new financial year, enabling Lucky Star to continue to leverage both brand strength and depth of distribution into new canned food categories. With the confidence to invest post the FRAP process, we commenced our program to upgrade and enhance our hake fishing fleet and spent ZAR 106 million on the Beatrice Marine, our flagship hake trawler during the year. Later in the presentation, you will see a beautiful picture of the Beatrice. The balance of the capital expenditure was largely replacement in nature. Going forward in South Africa, we are applying the learnings from our U.S. operation as we expand capacity in our West Coast fishmeal and fish oil business. We also have significant compliance-related CapEx, including refrigeration conversion of our fleet. And we will look to improve capacity at the same time as we have done in the past. This will require incremental CapEx of ZAR 600 million phased over 3 years, which will be managed with due regard to manage market conditions. Neville mentioned our debt position. The Group settled ZAR 767 million term debt during the year, compared to ZAR 220 million in the previous year, in line with our debt reduction plan. We ended the year with net debt of ZAR 2 billion, compared to ZAR 2.6 billion in 2022, mainly due to term debt settlement, partially offset by higher working capital requirements in SA and the translation of U.S. dollar debt at a weaker exchange rate. Gross debt reduced by 22% in SA and by 21% in the U.S. The $21 million replayment in the U.S. included a $15 million prepayment and refinance of the remaining debt on more favorable terms. We are fully hedged on U.S. debt until September 2024 and currently receive interest on excess cash at 4.4% compared to interest that we pay at a hedged rate of 2.75%, benefiting from the removal of some covenant requirements of the previous facility. The significant improvement in the net debt-to-EBITDA ratio from 1.7x to 1.2x is particularly pleasing given the high interest rate environment in both the U.S. and SA. This was achieved due to the 20% increase in EBITDA from ZAR 1.5 billion to ZAR 1.8 billion, while net debt reduced at the same time by 21%. From a 5-year point of view, in terms of looking at our debt and how it's progressed over that period, over the past 5 years we have reduced gross debt by ZAR 1.2 billion, excluding the exchange rate impact on U.S. debt, which is a further ZAR 300 million. This is now our lowest debt position since the Daybrook acquisition in 2015. In the same period, we have significantly reduced our net debt-to-EBITDA from 2.2x to 1.2x. Due to our U.S. rates being hedged, our strategy has been to also pay down SA debt due to high interest rates in South Africa. From a net cash perspective, the Group delivered strong cash generation and significant improvement in free cash conversion to 82% in the current year, while the prior year was impacted by the increase in inventory. Daybrook's strong performance resulted in cash generated from operations after working capital changes of approximately ZAR 1.2 billion. We generated ZAR 270 million more cash operating profit at ZAR 1.8 billion, which is a 17% increase compared to 2022. The net working capital movement represents cash utilized of ZAR 445 million in South Africa and cash generated of ZAR 291 million in the U.S. The Group paid down ZAR 310 million in SA net debt and ZAR 368 million in U.S. net debt during the current financial year. From a capital allocation point of view, and looking at the priorities for us as we move forward, we are very pleased to have restored our working capital to satisfactory levels as we look to optimize this going forward and proactively manage our cyclical inputs in a tough operating environment. We will continue to reinvest in our business with a 3-year phase CapEx program as we invest post FRAP and grow the business to benefit efficiencies and firmer product demand and pricing. Dividends will continue to be based on operating performance, CapEx requirements and debt levels, taking cognizance of market expectations. The Group will continue to manage debt prudently. We will take SA and U.S. interest rates and currency differentials into consideration, bearing in mind our U.S. interest rate hedge ends in September 2024, as well as the likelihood that interest rates in both countries are expected to decline in the medium term. We will also continue with our strategy of creating balance sheet capacity for organic and acquisitive growth. I would like to hand back to Neville, who will go through our operational performance. Thank you.

Thanks, Zaf. Okay, I'm going to start with the business that struggled this year and has put a lot of good things in place this year, and hopefully, they'll deliver next year, but it was a tough year. And I always say this about fishing, and obviously, you know that comes through the side of it -- comes through this side of the business. But the 3 costs that drive a fishing vessel's performance is labor, maintenance and fuel. And all of those are fixed. When you put a net in the water, whether you catch 1 ton or 100 tons, the cost are the same. So your cost of sales go through the roof. And that's what's happened to this business. Combination -- and it's across the board. Most of the species have had struggled with catch rates. So as you can see, the performance, disappointing, 15% down, revenue slightly up. But it's driven because of the high cost. We couldn't recover the cost. So it's catch rates, the amount of fish that are physically in the water, and the amount of sea days that you spend there. We have some breakdowns and we spent considerable time upgrading the Beatrice. So the vessel wasn't available. On the horse mackerel side, we operate the 2 -- the 3 vessels. One in Namibia, where we operate 2 vessels, one in South Africa. Namibia had a reasonable catch rate. Still down on last year, but reasonable. Markets very, very positive. You can see the combination of catch rates and costs. So that red line that you see on the top there, that's the Desert Diamond's cost. And it's simply because of catch rates. We are struggling on the East Coast of South Africa. We are still being affected by the La Nina effect, the warming of the waters. And whether it be squid, hake or horse mackerel, which is [indiscernible] struggling. What is positive is all the scientific evidence show that the resource is not under threat. Horse mackerel will probably have a similar resource -- a similar TAC this coming year -- to 2024 calendar year to '23. Hake has actually got a 5% increase. And the squid season started on Friday. I haven't heard any reports of how -- that the vessels are out, but the early indications was that the resource was reasonable. So you can see the sales prices themselves have been very good, in particular on the SA side where, obviously, with the shortage of stock, prices have gone through the roof. But Namibia had a reasonable season. And we're expecting a slight decrease in TAC next year in Namibia. But certainly, low-cost protein is still in high demand. People are looking for affordable protein. On the hake side, and you can see a combination, that blue block on the top there, that's sea days. That's the combination of the Beatrice coming out when we had to do the refurb, we converted the vessel from a freon-based refrigeration plant to an ammonia-based refrigeration. That took us 3.5 months. And we had one issue with the other big hake vessel being our shaft -- our prop shaft had a crack in it. It's an old vessel. We try to get a spare part and they weren't available. We eventually actually made one, and that took us 2.5 months, and that put the vessel out. So a combination of poor catch rates and limited sea days pushed cost up. Pricing has been very, very strong. Demand for hake in Europe, in particular, Western Europe, has been very good, and we sell a fair amount of the quantity in South Africa. So again, this -- I think this is a strategy, we've got to effectively keep those vessels at sea as longer. So the older vessels we're spending money on in terms of investment, in upgrading them, and make them more effective in terms of how fast they can catch. The Beatrice went from production capacity of around 25 tons a day that it could process through the factory to around 45 tons a day. The 45 tons a day hasn't been tested yet because we haven't got [indiscernible]. But we know that the moment you do that, you can effectively halve your output -- your cost of sales. And that's where the driver is going to come within that. So she spent a lot of time in both Diamond and hake vessels in terms of upgrading those vessels. Very small part of our business, but squid is the same thing. You can see pricing going through the roof. Squid catches, and that's the typical trucker vessel that you see on the East Coast. If anyone's been to [indiscernible] and you see those vessels with the lights on, those are the typical trucker vessels. They catch -- it's not a TAC, it's an effort-based fishery. You can catch as much as you want over a season. Our main season runs from November now until February next year. And that is where you drive the volume. The demand for squid, and all of our squid, every single piece of calamari you eat in South Africa is not from South Africa. It's from cheaper imports from Portland or Peru. All of our squid is high-quality squid that goes to Western Europe, sold in Italy, France, Portugal, Spain. Very, very good squid. As you can see, prices are through the roof. Hopefully, the season will be a reasonable season going into this next year. The lobster -- we operate in 2 lobster resources, one on the West Coast, one on the East Coast. The one on the West Coast, and I've spoken about this at length, I don't believe will last much longer. Unfortunately, DAFF and we're working with DAFF to try and manage poaching, but they simply don't have the resources to control the amount of poaching that's happening on the West Coast. So the resources -- the TAC has been cut by another 20%. It's down to 500 tons. 10 years ago, it was 4,000 tons; it's now 500 tons for the whole industry, including small scale, and the poaching continues. So we are in the species, we operate in the species, we work with DAFF because if we're not there, there's no eyes and ears out there to try to give them an indication of where the poaching is happening. But I don't think we'll get it under control. On the East Coast, that's a deepwater lobster. Very, very stable. We catch it at 150 to 200 meters deep. Very good lobster, sold mainly to the States, into their white tablecloth type restaurants. Very good species. And that species has actually been -- is actually growing. The TAC will be up by 5% this year. So, strong. And that's an area we do want to invest in. We are going to be looking at a new vessel. So that's in this business. The one good thing about this business, and you've all heard about the FRAP process. The FRAP process is essentially over now. We have now got 15-year rights across the board, with the exception of the [indiscernible], and I saw C. Middleton on Friday -- last Friday, chatted about it, those appeals will be out this week. We don't expect any major change in that. And generally, we're quite comfortable of where she -- where DAFF have landed. We've, in some species, lost a little bit. In some species we've been fairly flat. But I think she's taken a very -- and I'm talking about the minister now, she took a very pragmatic view in terms of what she would do. She obviously had a mandate of transformation. She had to allocate new rights. But she didn't want to disrupt the formal industries, and particularly, the capital-intensive industry where we employ a lot of people. So generally, the resource has been fairly -- you can see on hake, we're fairly similar to what we were pre-FRAP. On the squid, the licenses are the same. You could see on the small pelagic, I put a question mark there. Hopefully, by the end of this week, we'll know, and I don't expect major changes. The key for us is it gives us 15-year rights and now we can invest. We now know we've got security of tenure we can put into the vessels. We know the resources are being fairly well-managed by DAFF. I'm talking about the commercial species. So is -- it gives us the sense of comfort to go and put some serious capital into this business. And [indiscernible] has been given the go at our budget meeting earlier this year by the Board to spend some money on CapEx over the next 3 years. If you remember, pre FRAP, I remember there was a discussion where we were concerned that we would lose up to 30 -- that the formal industry would lose up to 30% of our rights which is very concerning and we lobbied very hard to the minister and [indiscernible] to say that if you do that, you're going to destroy jobs and they've listened. So there's been a healthy balance. You can't make everybody happy all the time, but I think we're comfortable where we are. Then the Lucky Star business, and again, compliments to [ Lawrence ] and his team of what they've done. Revenue up 20%, operating up 4.2%, a reasonable performance. And there, you see the margin of -- a drop of margin down to 8.9%. 8.9% is still a healthy margin, acceptable margin. Given that we've driven that up that volume by 9%. This is the actual performance. We did have a [indiscernible] in the year of 10.1% but that certainly didn't recover the input cost that we had. And obviously, we were subjected to a weaker Rand. The raw material that we buy for the Fish, and I'll show you some numbers there at the bottom, you can see the production there, that's the production from our own factories. So we produce in the 2 canneries in South Africa and 2 canneries, 1 in Thailand, 1 in China. About 5.4 million cartons were produced through our canneries. And that's part of the way that we were able to mitigate the increase in costs because we put more volume through the factory. So [indiscernible] factories, as you can see over the last 3 years, it's gone from 3.5 million cartons to 5.5 million cartons. And that allows the scale and the recovery of overheads to reduce the price. The other positive thing is that you see that bottom block there, 18%. That is the wild caught fresh fish. That's our own fish that we're catching on our own waters. The other tonnage is what we buy, frozen from all over the world that put through to our factories. Obviously, own fish is cheaper fish. So -- and that's a positive sign that going forward. So this is the Pilchard landings. As you can see on the top left there, those are the Pilchard landings from our own vessels. In fact, double from last year. Last year, we caught about 6,500 tons. This year, we caught 14,000 tons. So very positive, and we expect that to continue. Our procured volumes, we are the largest buyers of Pilchards in the world. And last year, and in 2022, we had to invest in stock. You can see at the bottom left-hand graph, the procured volume, we bought 140,000 tons of what we call whole round equivalent. So in other words, it's converted to a whole fish, whether it's in a can or it's bought because sometimes we bought -- we buy cutlets, which is the head [ is off ] sometimes we buy the whole fish, depending on what's out there because we buy all over the world. So we have to invest in stock and that 3.2 million cartons that I spoke about at the beginning of this year. That came at a cost when we procured that stock. We have bought about 120,000 tons this year. And the key for me is that bottom right-hand corner, that's the stockholding that we're carrying forward to next year. So in the beginning of 2023, we had 3.2 million cartons. About 4 months stock. We have got 4 million cartons right now going into this year, into this very busy stock fell promotional drive that's happening at the moment, 4 million cartons is about 5 months stock. So that allows us to drive the volume going forward and continue the strategy that [ Lawrence ] has done, working with the trade to make sure. And Lucky Star [ pulls ] feed through the stores. And these are some comparative figures that come from what we call a defined protein market. So -- when we look at who we compete with, we exclude Staples, bread, Maize, pasta, we really look at the key proteins that our consumers buy. The consumers that consume Lucky Star, what do they eat as an alternative. And then there are a couple of key things is IQF chicken, eggs and [ Polony ], the typical polony you see on the shelves. That's what -- that was -- and we only enjoy -- and that market is about ZAR 100 billion in size. Our turnover of about ZAR 5.5 billion in Lucky Star. So we're a relatively small player in that market. But what it does show is the opportunity. I mean, I was, in fact, surprised by the size of eggs. 12% of that market is eggs. Eggs is a massive contributor to that protein market, potential for us to grow, increased consumption, always is a story. When something is on promotion, coffee for instance, and you go and there's coffee on special and the housewife goes and buys 2 jars of coffee. You don't drink more coffee. You still drink the same amount of coffee, 1 cup a day and it last you 2 months instead of 1 month. When you go and buy Pilchards, or food -- and you -- instead of buying 1 can, you buy 6 can. Generally, you will eat a little bit more. You will use that consumption, that increased promotional drives -- increased consumption because it's in our shelf and you serve it once a week, you may serve it twice a week. That's what we do, and that's what the key is drive promotion. Right now, 70% of all food purchases is done on promotion. People are no longer -- housewife takes a trolley, walks through the whatever supermarket and fills it up in terms of what you need. Most consumers now are going on to our broad sheet, they're looking at what's on special and they will pick I want to buy that from Shoprite, Checkers, that from Spar and that from Pick n Pay. In fact, the hard discounts as [ Lawrence ] will tell me the types where they sell commodity type products like [ box ], et cetera. Up to 90% of their sales is done on promotion. So people are really -- and that's where we are playing and the consumer -- and the -- sorry, the trade, our customers know that Lucky Star pulls people through their stores, and they're doing it very effectively. We're on promotion at the moment in [indiscernible] [ 234 for 6. ZAR 19.50 ] That is probably ZAR 6 below our cost. We put in and so is [indiscernible]. That's going to drive volumes through those stores. And it's very, very strong, and we keep doing that. So -- and it does come, as I said, at margin, but I think that margin is acceptable. The other key point that I wanted to point out, the Lucky Star Canned Pilchards is now in 93% of household pantries. So if you go into any pantry -- household pantry and think 93% have a can of Lucky Star, up from 87%, again, testament to what we've done and what [ Lawrence ] and his team have done throughout this year in terms of driving consumption. And just those top graphs just show you that the movement, the 12-month moving volume growth in terms of the market was flat on last year. Lucky Star grew by 9%. More growth in the wholesale sector, which is interesting. Remember, the wholesale sector is where we sell a large percentage of it because the wholesale sector supplies a [indiscernible] source. So the growth in the wholesale sector is stronger than the retail sector. And there's just some range of products. What is -- if I just explain in this graph, you look on the left-hand side there. So this is [ defined ] protein again, in 2022, the total market declined by 2.7% relative to 2021. In 2023, this is up to September, it was flat. Across the board, chilled process meats, Tuna, canned meat, IQF Chicken, Fresh Chicken, eggs with the exception of IQF Chicken which is a small growth in this last year, all showed volume declines. A symptom of where our consumers are at the moment. They really are struggling. If you can give them, they are shopping for value, they're shopping for -- and that's the game we're going to play. We're going to continue driving that strategy. And now I'm going to jump across to Fishmeal & Oil within the context of the business or those pillars I showed you. So this is the business that is aligned to the Lucky Star business. And to me, this is where the key opportunity for -- one of the key opportunities for this business is. So Red Eye, we catch Anchovy, which is a TAC and Red Eye is a bycatch, we caught about 75,000 tons, exactly the same as what we caught last year. The industry, just the total TAC for the industry is 240,000 tons. That's all of the players in the South African industry. The total catch for this year was 110,000 tons. So that means we left as an industry, 130,000 tons in the sea. On Red Eye, which is a bycatch, also has a limitation. It was 120,000 tons. The industry caught 110. So effectively, we have lost -- we have left in the sea 150,000 tons of fish, and that's where the opportunity. That's where we need to -- and we're spending excessive -- not excessive, we're spending a healthy amount of CapEx on your 2 factories, [indiscernible] over the next 3 years to try and do exactly what we've done at Daybrook. To try and get those factories to increase throughput, increase quality and increase availability. The difficulty when you're fishing with this type of species is you've got relatively small vessels that can't withstand high seas. It's not like a big Hake vessel or a Horse Mackerel. When there's a 3 meters well we can fish [indiscernible]. A [indiscernible] can't fish in difficult -- so if there's bad weather or high sea's, it can't fish. The key is when there are fish and when the weather allows, you need to be able to [indiscernible] the quickest possible. That means availability of factory, more [indiscernible] space. So when the vessel comes in, then you can have 3 vessels pumping out into the factory, put it on land. Last year, I told you about the raw fish boxes in the U.S. where we increased the size. That's the storage capacity on land. Take those vessels, pump it on land and get those vessels back to sea. We need to do that. We haven't spent enough over the last 5 or 6 years, maybe longer 10 years on these factories, and we are going to be spending on this because then we can drive -- because of the opportunity of 150,000 tons that gets left in the sea. And it's not on our own vessels. There's lots of vessels out there, the contract vessels. They don't have a factory. They have a quota, they have a vessel, they have private tiers. They catch. They will go to the factory that can offload them and they shop around. And if you can't offload them 3 hours, they go somewhere else, that's where the opportunity allows. Again, so this much -- of a much as production was fairly similar to last year. Didn't -- we could have done so much more given the price of fish oil and fishmeals. Still at reasonable. You can see the fish oil price on the right top right there, going through the roof. Production was okay, not fantastic, okay. We had the advantage of the price, and that drove this business, but we could do so much more. So certainly, and over the next year, I will talk about it a lot about what we're doing in the factories. You'll see some photographs. The boiler plant in Laaiplek, which is a factory we bought from [indiscernible] in 2015 was an 80-year-old boiler plant. I went to look at some of the products its got there. It's 80 years old. We've now decommissioned that and putting a brand new boiler system. Obviously, boilers is -- we're not reliant on Eskom. But that drives -- it's not only a replacement, it drives efficiency. It drives -- we're putting new [ dryers ] in this factory, which we can only do when we have those new boilers. It's expensive, but it will -- the strategy is to upgrade those 2 factories. In the U.S., our star performer. And when I say star performer because they did -- that we're able to take advantage of the oil price. So you can see the numbers speak for themselves. Operating profit up 38% in Rand terms, up 30% in dollar terms. The catches were not phenomenal. We were expecting at about July, we expected to have a record year. The catches were well ahead of the 5-year, 10-year and 15-year average. We measure fish there not in tons, but in million fish. Last year, we caught 703 million fish. We were hoping to get somewhere between 800 million and 850 million. Then suddenly, for about a 6-week period, there was this massive heat wave in the southern part of the States. They've had very low rainfall and the water temperature because it was low, just spiked and the fish actually either went deeper, so we couldn't catch them all they went up the river. And because of the low rainfall levels, the salinity up the river, where we are not allowed to fish was fairly stable, so they could actually live up the river. So a lot of the fish went up the river. So we ended up on 665 million fish which is still ahead of the 5-year average ahead of -- slightly behind last year. So it's still a reasonable performance, but it could have been that much better. Again, our [indiscernible] we can't predict what fishing. Fishing is something I can't do. We put all the technology but what we did do is the point I made. We didn't have a factory that was not available, 18 hours over 7.5 months was phenomenal normal. So they managed to turn those vessels around. And that 665 million fish that caught was testament to that factory being able to receive the fish. So a great performance. These are the production levels and oil. Obviously, oil yield is a key component of this. We normally like to have oil yield around 10% is always average between 8% and 10%. That means the fat in the fish, how much fat? And what we found this year because, as I said earlier, there was low rainfall. There wasn't -- Mississippi wasn't playing a strong. The nutrients coming down. The river didn't feed the fish, and we didn't have as fat fish as we had, which meant to a lower level oil yield. In the last 2 weeks of the season, post year-end, when we fish until third week in October. The actual oil -- they started having rain and our oil have picked up quite nicely. The last 2 weeks is 10.1% oil yield, which was a nice little kicker for this year that we got some extra oil. We -- the one key thing that I -- we've again done this year is we've carried a healthy stock of oil into next year. So we've -- at the end of this financial, we carried about 27,000 tons of oil and about -- sorry, of meal and about 9,000 tons of oil, again, for our contract buyers. And that oil has been contracted and sold. And it will be sold between now, the oil -- the 9,000 tons will be sold by February. The meal we started to sold until about April. At extremely good prices, far better prices than remember the way the oil price move, and I'll show you some graphs in the Peruvian catch. This year, our weighted average oil price was around $3,500 to $4,000. The current price of oil is $6,000 a ton. It is just phenomenal and doesn't seem to be dropping off. I know some of the people have read some stuff in the press about oil prices being at $9,000. That is human consumption oil. It's definitely an area that we will look to in the future, but that is -- that goes into the tablets. And because there's such a shortage of that, the prices passthrough the roof. But the oil price at the moment in terms of our contracted oil is still going to remain at those high levels. So a very good start for the current year from Daybrook again. So those 2 graphs on the right-hand side, you can see the price I put down oil at $6,000 and the fishmeal staying at that current level. And those are the stock levels that we're currently carrying forward and that have been sold. And the question is why and what is going to happen to the Peruvian. Remember, we catch ourselves Anchovy in South Africa, we catch a specie called Menhaden in the U.S. And the Peruvian catch is also Anchovy. All 3 of those species are very high in omega-3 oils, which is what the salmon farmers need. They can't replace the other -- many of the other species also produce oil, but they don't have the same sort of omega-3s. And that's the key ingredient in the salmon farmers that they want because of the growth rate that they achieved with the salmon and the health of the fish. They don't -- you can't put vegetable oil or non-fish oil into their feed because it affects the health of fish, they actually get sick. So the demand is very, very strong. What -- and remember, they canceled the season in the early part of this year in Peru, there was no fishing season there. They have 2 seasons, normally, about 5 million tons they catch a year. Nothing at the beginning of the year. And then I announced about a month ago, they announced the second season at 1.6 million tons, which is lower than normal. As of last week, that caught around 750,000 tons of the 1.6 million and don't expect to catch 1 million. So it's somewhere between 750,000 and 1 million, which is going to continue the shortage of meal and oil. The other good sign for us is that the oil yield on there -- on the Peru Anchovy is normally around 2%. Their current oil yield is at 0.4%. So there's going to be a massive shortage. So we don't expect oil pricing. And when we were talking earlier in the year, we saw this massive spike in oil. And we said this is a once off bonanza that we're going to get, but it will come down to some sort of normal levels. It will never go back to -- I, my view it will never go back to the old levels around [ $2,000 ] because of the growth in the agriculture industry and in the salmon farm industry, we've almost got a new base. Whether we'll get to that new base, I'm not sure. But I think certainly for the next 6 to 8 months, we're going to see a continued level of around $6,000 to $7,000 a ton, which is very good for us as an industry. This is a graph I've shown before, and you'll notice it only goes to 2021. It's been done by the FAO Fishery -- world body on fisheries research. And you can see over the last 50 years, wild capture is fairly static at around 90 million tons, 91 million tons. And 1 species goes up, 1 species goes down, it's [indiscernible]. One of the big industrial fish. Horse Mackerel is one of them. Aquaculture has continued to go through the roof. And you can see that in 2021, for the first time it exceeded that [indiscernible]. And it's again about food security. And China is a big driver of that. And that's the industry we play in. Our fish will continue to go into aquaculture and obviously, the pet food market in the U.S. But that is interchangeable. If the pet food market declines -- we can sell every kilo of fishmeal and fish oil that we produce. It's really about managing price and demand. So -- and people asked, was Daybrook a good investment? And it took a little bit longer to see the benefit. But certainly, it's now starting to pay dividends. What we predicted in terms of where the market was and it was nothing to do with me, it was Francois Kuttel, who hopefully I think he's listening tonight, he's been invited, it's 1:00 in the morning. So Francois well done, if you are listening. But he -- and this is the reason that Oceana invested in the Daybrook business because we believed in the aquaculture industry continue to grow. And this will get some latest figures later this year until where aquaculture is continue to grow. I thought I'd put these graphs because it also shows that the usage, if you -- to that top one, in the 1960s, poultry and pigs were the main consumer of fishmeal, fishmeal, remember fishmeal and oil -- fishmeal particularly is a growth hormone. So they put it in a -- it spurs the growth of the chicken. I don't see if you remember about 10 years ago, chicken started tasting like fish. And it was because the industry -- the chicken industry started -- the inclusion rate of fishmeal they put into the chicken started because you got -- instead of growing a bird out at 38 days, you could grow that in 36 days, just put more fishmeal in it. The trouble is it started affecting the taste of the bird. And they had to drop the inclusion rate to try and manage this. So that was in -- if you look at it now, 76% of all fishmeal goes into aquaculture. And that's because there isn't another alternative. You can't find alternative for chicken, you can use other types of protein to enhance their diet, but not in aquaculture. And the same in oil. The fish oil uses all aquaculture. 73% of oil goes into aquaculture. So -- the reason I'm showing this is, obviously, in terms of where the future of our business is why we are prepared to invest, in particular, it's a layman's business in the next couple of years is because we can take advantage. We believe the pricing has got to go up. We believe that there's sufficient uncaught quota in the South African context that he can make -- have access to. But the only way you can do it, we've got to invest in this plant. And it comes with it's not just volume, it's quality. When you sell fishmeal, the protein levels of fishmeal are so important, the higher the protein meals, the higher the price, and you manage that. You have fat, you have moisture and your protein, manage those 3 to maximize and the older technology that we've got in these factories can't do that. The newer technology we're going to put in will certainly be able to do that. I've got a slide on ESG, and I think it's important, and it's something that we debated the other day at our own management meeting. So we will be putting a lot more focus. We are probably one of the leading companies in terms of [ MSG ]. We subscribe to the MSCI ratings agent, which is a worldwide agency that rates us on ESG, and we've scored a AA, which is the second highest. And it's something that's very important because we're particularly in sustainable seafood. So customers want to know that what we're catching is sustainable. On the top right there, 81% of our rights are [ MSC ] or sustainable, the SASSI green list. There's only 2 that are not. West Coast Rock Lobster, which I said is red, which there's been criticism we should be exiting it. If we exit it. We then are not assisting [ DAFF ] in terms of being the eyes and ears out there. So we may have a deliberate strategy, we will stay in it. And it's necessary to DAFF. The other one is the Pilchard, which is orange listed. It is with the -- [ there is still time ] to recover. Remember, ten years ago, we used to catch a 140,000 tons of Pilchards. We catch 35,000. But over the last 3 years, it's slowly starting to come back. So it's orange at the moment, but we expect it to go in, in the next couple of years. But it is. Obviously, energy and carbon emissions is very important to us. The conversion on [indiscernible] boat or the Beatrice, that conversion from Freon, which is not a carbon-friendly gas to ammonia, which is a carbon-friendly gas is key for us, and we're going to convert all our vessels to ammonia. It takes time. It's not only on ESG, it's also an efficiency issue. So when we convert these vessels, we will also convert the vessel, the factories and the catching capacity. Going forward, what do we do? So what is the focus, and this is not a strategy, this is just over the next year. So -- we are still obviously conscious about in the Lucky Star space about the SA consumer. She is still -- they are still under huge stress. High interest rates, high inflation rates, higher unemployment. So it is something that we will focus on. We -- as I've spoken about consumption to increase the consumption of Pilchards so we could take some of the market share against those other protein sectors, chicken and eggs and Polonies. Rand is a concern for us, always is. We are fairly naturally hedged as a group but if you talk to [ Lawrence ], what is he stressed about every day, is the weakness of the Rand, and he sends me a whatsApp every 7 day when it goes up, but he never send me one when it goes down. But it is -- if the Rand blows out, it will affect this business when we're importing 100,000 tons of fish, we will have to go to the market with a price increase. We will try and manage that through more efficient operations. We are spending capital in [indiscernible] business in the 2 canneries to improve 2 things, yield and throughput. Don't waste fish. When you cut off fish, don't give a little piece on the end because that's wasted fish. It goes into fishmeal, which is a much lower value to go into care.. Those are the kind of things we need to spend to try and manage that cost because I can't control the Rand. We've got the new canned meat facility, which -- production started in the first of October. We are building up stock. We'll do an official launch, and we'll certainly invite all of you to viewing and a site launch probably in February next year to come and look at it. But it is -- to me, it is part of the growing of Lucky Star as a brand outside of fish. So at the moment, it's going to be doing corned meat. We believe there's a huge opportunity. We tested the market using a contract packer for 2 years. Bought the canneries, put it in, and we will launch properly next year, and we think that's a nice margin and volume and answer. But it also gives us an opportunity to put other brands, other types of food product, luncheon rolls, vegetables, because it's a stand-alone facility, has the ability. It's not compromised by the fish factory. They're very close together. So we get the synergies in terms of distribution, 1 canning, 1 labeling plant, 1 distribution plant, they all go together. But it gives us the ability to enhance that brand and widen it. [ Lawrence ] is also looking at some flavor additions in the Pilchard side to try and grow the consumption of canned pilchards. We've got Lucky Star tomato and chili to look at some other -- and sweet chilis and other flavor. And then I said we're going to invest in [indiscernible] factory in terms of modernize it. So that's really the strategy going at the outlook for the next year on the Lucky Star side. On the Fishmeal and Oil side in the U.S., our -- the big component is obviously the carryover stocks. Very, very healthy stocks. We'll see what the season looks like next year. I can't control that. But at least we've got a very good start and the season is -- the factory has now been stripped. When we have this 4, 5 months period of no production, we literally take the factory apart and put it back together so that -- so this year, we have the same sort of output in terms of limited downtime. Francois, over the last 2 years has invested -- our partner there. You remember we own 25% of Westbank. He's the major shareholder, and he's invested quite heavily in vessels this year, in particular on the 2 purses, the 2 vessels that drop into the sea and gone catching -- putting jet engines in there, and they have been affected this year. Interesting, we were -- I think I've spoken about this before, the view was that they would be faster. So when you purse the fish, go around the fish [ with two little ] boats, that will be quicker. The actual benefit was not so much the speed, but the sound because they're jet engines, they don't generate the same sort of sound in the water as a normal prop engine, and it doesn't scare the fish so that we are able to circle a bigger portion of the school. So we are investing and we've already ordered 2 more sets of jet engines to put in. We operate 12 vessels there. We've got 2 sets of 2 [indiscernible] Jet. We're going to put another 2 in. Again, just to all these little small things too because that fishery is not a TAC fishery, it's an effort based. You can catch as much as you possibly can in 7.5 months. So a key for us is to drive that volume. And then as I said, I think that the shortage will continue for longer than expected. So pricing should maintain at those levels. [indiscernible] business, I'm sure she's hoping that catch rates will improve. The La Nina effect has started dissipating. We're seeing the El Nino effect now, which is the cooling of the waters, which we think will be positive for -- and I saw last night or [indiscernible] catches and an [indiscernible] are reasonably good which touch would, [ not wood but touch wood ], but that will be good. So it is about catch rates, but it's about investing in these vessels. We've got the smaller [indiscernible] the major upgrade next year again, all to take advantage of when the resource starts coming back. And I think it is -- I don't -- from a market point of view, I'm very comfortable that the market is still strong. We've seen strong demand for all of our seafood. So it's about getting those vessels right. This is just a picture. I just wanted to show you the canned meet factory. As I said, you'll get an invite. That was the old lobster factory. It's about a kilometer away from -- for those of you who went to the cannery last year, it's just up the road. I think we did take you there. You did pop in there, that's right, we did. So that's the new factory. It's now fully up and running. It's really looking good. We've done the production, the quality is looking good. So big launch come early in next year. I'm sure [indiscernible] is watching for us, but it will be an interesting game. This is what we're doing in [indiscernible] business. Current fishmeal plant has been completely demolished. You can see the top right here. That was the old boiler plant that's gone. Cannery upgrade. We're putting auto packers in, which is an auto -- instead of packing by hand or by a slot, it's an auto packer which improves yield and throughput. And then the boilers at the bottom. 80-year old plant. That's $100 million invested in boilers over the 2 years. So there's some sizable CapEx that's going to come through to those businesses. And then maybe just to end off with the strategy of where we're going. This is obviously long-term. Lucky Star continues -- I mean it is a brand that has massive, massive draw from a consumer point of view. We think we can still grow consumption. We still think we can grow the brand leverage. I always -- there was interesting story. I don't know, PEP approached us not too long ago about doing [indiscernible] in Lucky Star. We weren't going to -- they just decided, they thought it was a great brand. We were quite happy it gives us marketing leverage. We don't do anything from it, and they ordered something like 12,000 or 15,000 pairs and was sold off in 2 weeks. So it just shows the strength of the brand. We need to -- and we keep driving that kind of -- so we want to go and drive that brand and take the brand wider. On the fish oil and [indiscernible] business, 2 strategies. [indiscernible] business is investing in his facilities to take advantage it. There's a 3-year plan for us to put some serious CapEx in both plants, the Laaiplek plant and the St Helena Bay plant. And in the U.S., it's all about optimizing. We've done the hard yards on the factory in U.S, enhance [indiscernible] strategy in South Africa. The question is now how much -- how can we expand that business with Francois to improve the catching ability of those factories. And on the Hake side, the focus will be on vessel investment. Upgrading the vessels, increasing the ability to catch fish when the fish are there, and that's across all species. So it's squid ,Horse Mackerel, Hake and south coast rock lobster. West coast rock lobster, we'll maintain where we are. We won't be investing anything. That's a very variablized structure now. So it quite doesn't affect us in terms of the quota going up or down. And that's essentially the investment. So the performance. So thank you very much for listening. Thank you to the Oceana team. Those online and those here for a phenomenal performance. I will say to you now that I've got a really switched on ExCo. We're very together. It wasn't always that case, but certainly, there's a healthy debate amongst the ExCo members of understanding each other's business, of being able to challenge each other. There's no kind of subject that is not allowed to be discussed. We put everything on the table. Everyone has an area of expertise in each other's business. So there's a very close working relationship, both from the -- MDs of the respective business units and the support functions that we have from Zodwa to Bronwynne, HR, to Jayesh and co in ESG. So it is a very strong team. We've got a clear strategy, I think, for the 3 years. Each pillar has -- knows exactly what they need to do over the next years. It's going to come with investment and Zaf is going to have to manage our balance sheet very carefully because -- and debt. But I do think it will deliver over the next 2, 3 years. So I thank you for joining me. Nice to chat to you face to us, and I'm open to some questions.

First one -- you answered, but -- which is what is the reason for the elevated fish oil prices and how sustainable do you think they are? I think we've answered that, but if there's anything else you want to add to that?

If you have to say to me, when do you think it will start coming down? I would probably say, at the end of next year, kind of the later part of '24. What it's going to come down to? I don't know. It will depend on the Peruvian catch and the yield. At current 0.4% yield, that means even if I catch the full tonnage, the output is going to be very low. So I think it will hold for longer. And the other key thing that I've added is I don't believe it will be set back to the old levels. It will be somewhere in between.

The next one is from [indiscernible]. How much of the poor catch rates in Hake is due to tough weather conditions in Capetown during winter? Have you seen a significant improvement in the catch rates for the change of the season in the last 2 months?

I mean weather did play a effect in -- even at Hake vessel, if the weather is really tough, it has to dodge since you're going to a bay, you won't have to stay and think when you're going to bay. The main reason was catch rates. And all of the major. The 3 big Hake business [indiscernible] and I think have suffered exactly saying it has been a resource. And so I would say the bulk of it is catch ability rather than weather.

That's all the questions we have online. So there's opportunity anybody in the online audience wants to ask. Dirk?

Yes. And just a question on fish oil. How big a component is the fish oil and cost of the aquaculture producers? And because...

Yes, we -- we've got some numbers somewhere between 14% and 18% of the input cost is for sure. So it's not a major component, but it's expensive. So obviously, it's gone and doubled.

So. I was going to say $2,000 a ton or is that a...

No -- So when we did that, we did it at the -- I asked [indiscernible] when he was at the [indiscernible] just 2 months ago. And he there spoke to the major -- and it's the feed manufacturers that develop the feed. And that was their number. So it was at the high levels. So it is reasonably high, but not excessive. The key is there isn't an alternative. And the -- and it does open a gap because there are things like seaweed development where you can extract oil. So -- but they're very expensive to do. But with the current prices where it is, it will speed up the investment in that. So we mustn't get [indiscernible] it. It is something we are taking advantage now. But I think you'll see those levels. The moment it comes down to 3,000, 4,000, the cost of doing that kind of experimental stuff becomes absorbent.

Just the other point to mention is a 25% land tax for fisheries in Scandinavia. I think it's the Norwegian, So, they're looking at alternatives in terms of setting up fisheries around the world. And it depends on when they have a change of government. I'm sure they'll relook at that tax. But that's a significant tax for them. It's probably a bigger issue for them than the cost of fish oil.

Zaf, one for you. What net debt -- sorry, this is from Paul [indiscernible] what net EBITDA would you become worth knowing that Daybrook is a cyclical -- is at a cyclical peak in terms of EBITDA currently?

We wouldn't look to go above 1.6. Historically, we were at 1.7 over the last 5 years. So I wouldn't be uncomfortable around 1.6. I think what we've done in terms of our base CapEx program, we understand that we're going to sort of get to that point over the next 3 years. And that's assuming that Daybrook doesn't perform as well as it's done over the past few years.

Thanks Zaf, no more online. Any more in-person questions?

Coffee and snacks?

All right. Great. Any -- thank you.

Thank you all for making the time. Really appreciate it. Thank you.