PGG Wrightson Limited (PGW.NZ) Earnings Call Transcript & Summary

Welcome, [indiscernible] good morning. I'm Garry Moore, the Chair of the Board, Independent Director and a member of the Audit Committee. And I became Chairman in February 2024, and it's my pleasure to welcome everyone to our Annual 2025 Annual General -- Annual Shareholders' Meeting. Today's meeting is being held in-person and online through Computershare's online meeting platform. But before we get started, just a couple of housekeeping matters. In the event of an emergency, please note that the wardens will direct us to the safe exit and the hotel staff will assist in the evacuation process. In the event of a seismic event, there are exits at the door you came in and to my right. We are recording this meeting, and it will be posted on our website later today. And I confirm that we have a quorum and accordingly declare the 2025 Annual Shareholders' Meeting open. We will refer to PGG Wrightson Limited as PGW throughout the presentation today. Today's online meeting is being held via Computershare's online meeting platform, which allows shareholders, proxies and guests to attend the meeting virtually and all shareholders attending, whether in-person or online can participate and submit questions and cast votes. If you are joining us virtually and have a question to submit to the meeting, please select the Q&A tab on the top right half of your screen at any time, type your question in the field and proceed. And if you require any assistance, there's a chat function there that will allow one of the Computershare team to reply to your query. Please note that you can submit questions from now on, that we won't address them until the relevant part of the meeting. And please also note that the questions may be moderated if we receive multiple questions. And if we run out of time, don't fear we will endeavor to answer your question online. Voting today is conducted by an ordinary poll on all agenda items. For those online, if you are eligible to vote at this meeting, you will be able to cast your vote under the vote tab. Once voting has opened, the resolutions and voting options will allow voting. To vote, simply select your voting direction from the options shown on the screen and your vote will have been cast when the tick appears. To change your vote before voting closes, you can see change your vote, and you can change your vote up until any time before I declare voting closed. For those of you in the room, if you do not have a voting paper, please talk to one of the Computershare team at the back and they will assist you. And we will collect the voting papers at the end -- end of the meeting and our Computershare team will act as scrutineers, and we will be posting the results on the NZX website after the meeting. To provide you with enough time to vote, voting is now open. The resolutions will now be available on the vote tab and please submit your vote at any time. The PGW Board has had no changes to its membership during the 2025 financial year. On the 1st of July 2025, Wilson Liu joined the PGW Board as an Independent Director, and Meng Foon, announced that he would not seek reelection at this meeting and retires from the Board today, having served as a Director since July 2022. Before we begin the formal business of the meeting, I would like to introduce the Board who are attending the meeting today. Good morning, come in. In the front row here, we have Deputy Chair and Independent Director and Chair of our Audit Committee, Sarah Brown. Next to Sarah, we have Independent Director and Chair of our Health and Safety Committee, Dr. Charlotte Severne. We welcome U. Kean Seng. Kean Seng has been a long-serving director. And we also provide a warm welcome to our new independent director, Mr. Wilson Liu. Wilson is also a member of our Audit Committee. Members of the executive team are also here today and seated alongside me, of course, is PGW's Chief Executive Officer, Mr. Stephen Guerin.

Good morning, room.

And alongside him is Peter Scott, Chief Financial Officer.

Good morning.

And to his left is General Manager, Corporate Affairs; Julian Daly, who also serves as our company Secretary.

Good morning.

I'd also like to introduce and welcome members of the Executive Team who are in attendance in the front row here, starting on the far right, Nick Berry, who is General Manager of Retail & Water. Next to Nick is Sarah Mears, who is General Manager, People & Safety, and then we have Rachel Shearer, Rachel Shearer, General Manager of Wool. And you see, they didn't sit in order. And welcome Peter Newbold, who's General Manager of Livestock and Real Estate. I'd also like to acknowledge and welcome representatives from the share registry, Computershare. Our auditors, Ernst & Young over here; and representatives from Rabobank and I understand that BNZ and Westpac are attending online. I'm not sure if we have a physical presence from New Zealand Shareholders' Association, but I know that they are also attending online. Apologies. We have an apology from Independent Director Meng Foon, noting that Meng is not standing for reelection. Are there any other apologies we should note? No. Okay. Our Company Secretary has confirmed that the notice of meeting was sent on 16th September 2025 and all registered shareholders and other persons entitled to receive that notice. I confirm that the minutes of the previous AGM -- Annual Shareholders Meeting held on 15 October 2024 were approved as a true and correct record at the Board meeting on 26th November 2024. The minutes of that meeting are posted on the Investor Center section of our website. The annual financial statements and reports of the directors and auditors for the year ending 30 June 2025, and set out in the company's annual report. And on the 16th of September gone, the annual report was posted on PGW's website and our NZX page. And a copy of that report was seen to any shareholders who requested one. I understand there's some more there, if you'd like one. We also released our Sustainability Report and Climate Statement for the year ending 30 June 2025, which provides an overview of our sustainability performance and activities over the past financial year, including our climate-related disclosures. This report is also available on the website. Throughout this presentation, we will refer to both GAAP or generally accepted accounting principles and non-GAAP performance measures. We use operating earnings before interest, tax, depreciation and amortization known as EBITDA as a key measure of our performance. And I encourage you to refer to our full accounts and details of how this relates to GAAP measures. I can confirm that 744 shareholders have appointed proxies for the purposes of the meeting in respect of approximately 41 million shares. I will now move to the order of business for the meeting and begin by providing you with an overview of performance results and sustainability highlights. And then I'll invite our Chief Executive Officer, Stephen Guerin and Stephen will provide an operational overview of the individual businesses. And he will also summarize how our business is trading in the current financial year to date. And I will conclude the presentation by discussing our forecast guidance for the full year to 30 June 2026. Time for questions will follow before we move to the formal business of the resolutions and voting. As outlined in the notice of meeting, the business of the meeting comprises 4 ordinary resolutions relating to the reelection of Sarah Brown; relating to the reelection of myself, both as independent directors; the election and ratification of Wilson Liu as an Independent Director; and authorizing the Board to determine our auditor's fees. Before I discuss our financial performance highlights, I would like to highlight that it's PGW's 20th anniversary exactly a week ago today on Tuesday, the 7th of October. PGW was formed through the merger of Pyne Gould Guinness Ltd and Wrightson Ltd, and PGW proudly carries the legacy of nearly 175 years of service in rural communities. In fact, we are celebrating our 175th anniversary next year. And like any good birthday, we will celebrate and conclude with a cake at the end of this meeting. So the year-end review. Operating EBITDA was $56.1 million, that was up $12 million or 27% on previous financial year. Operating revenue was $975.3 million which was up $59.4 million or 6% on the prior financial year. Net profit after tax was $10.7 million, up $7.6 million or to 248% on prior financial year. And the Board declared a fully imputed final dividend of $0.04 per share, bringing the total fully imputed dividends for the year to $0.065 per share. The sustainability highlights were a 22% reduction in greenhouse gas emissions since 2021. 100% of PGW sites are now supplied by renewable electricity and PGW released its climate transition plan. As I just mentioned, the operating EBITDA of $56.1 million was $12 million or 27% ahead of the prior year. The business has reported much improved results with the prior financial year appearing to mark the bottom of the agri cycle. However, the operating environment over the year was more challenging in the retail space. Constrained supply and demand -- supply and increased demand for livestock drove elevated red meat and dairy commodity prices, supporting very good farm gate returns. Elevated prices had a positive influence on the profitability of farming operations, and this has been reflected in a positive shift in sentiment. Rural real estate saw a lift in inquiries and dairy, beef, sheep and selected horticultural properties together with new listings coming to the market. Real estate activity was also supported by the easing of interest rates. The group's operating revenue of $975.3 million was up $59 million or 6%. And the net profit after tax, as I said, was up -- was $10.7 million, up $7.6 million from the prior year. During the year, PGW launched its refreshed purpose and vision and reset its group strategy. Our refreshed purpose of helping farmers and growers succeed with expert knowledge and confidence, showcases the driving force behind what we do, focusing on supporting farmers and growers to confidently achieve their goals through trusted partnerships, expert service and knowledgeable advice. Our vision has empowered farmers and growers for generations to come. It communicates what we do. It is future focused, bringing farmers and growers and what they get from working with us into the foreground of what we do every day. It is also -- it also encapsulates that we contribute and share in our customers' success. Our strategy on a page layout captures at a high level our purpose, vision, values, business units, functions and our group strategic priorities in a cohesive framework. Our strategic priorities articulate the unified areas of focus for the business and guide our collective efforts to strengthen our position as a market leader. Our strategic priorities referenced on this page cover the key priority areas we are collectively focused upon from a PGW Group perspective. These priorities cascade through the business as specific actions and initiatives. These strategic priorities have measurable objectives, and we track our progress against specific deliverables and targets. Our group strategy remains dynamic and evolving in response to changing market demands, ensuring we remain agile and future focused. Rather than discuss the strategy at theoretical level, I thought it might be useful and informative to discuss a few practical initiatives that we have been implemented in recent months as examples of activity going on at a strategic level. And I'll briefly touch on these initiatives that contribute to enhancing PGW's technical offering and our position as a market leader in the rural servicing sector. These initiatives further develop and leverage our existing strengths and amplify a number of our strategic priorities, in particular, our ambition to capitalize on customer-focused innovation and our differential offering. Customer-focused innovation refers to solutions that utilize science and systems to support farmers and growers achieve their production goals. Our differential offering hones in on the unique areas of competitive advantage that set PGW apart from others in the market. Ultimately, these initiatives all target growth for the business while leveraging PGW's core competency and our technical offering. In July this year, we acquired Nexan Group, a local manufacturer of VetMed range of animal health products. This acquisition is an excellent fit for PGW and the investment reinforces PGW's commitment to supporting local manufacturing and delivering high-quality innovative solutions to help New Zealand farmers thrive. The acquisition aligns with our strategy, while supporting business growth. The business provides vertical integration opportunities through the supply chain from product ownership, manufacturing capacity, wholesale supply and through the retail sales channel. PGW has partnered with Nexan for over a decade, and its commitment to innovation in rural communities aligns well with PGW's purpose and vision. The acquisition ensures these trusted New Zealand-made products remain tailored to meet the need of our rural communities. Nexan has a proven record in the research and development space as an innovator, and we see this core capability adding to PGW's strengths. And PGW will grow the range and continue to exclusively distribute Nexan's full product range, which is widely available through veterinary practices and rural merchants across New Zealand, including our own retail network. Another key growth initiative is the BlueAG label ag-chem range, which will be stocked through our retail stores. Building brand equity and our proprietary BlueAg label provides greater branding recognition and the opportunity to build trust and credibility in our own label. BlueAG provides PGW with price point control while giving our customers more product options that they can trust. We also recently announced that PGW had taken the lease of a 2.8 hectare research and development facility property, previously operated by Bayer Crop Science in Hastings. PGW has a long-standing commitment to R&D, and this site is an extension of that continued investment. Each year, PGW's dedicated technical team runs some 70 to 80 scientific trials and paddocks and orchards across the country in collaboration with cooperating farmers and growers. By investing in our own dedicated site, it will enable us to expand on those trial programs and implement more controlled and scalable research at the specific -- that specifically purposed facility. PGW's trials investigate the efficacy of new plant protection products, evaluate herbicides as part of registration processes and look into how particular fertilizers work in New Zealand conditions. This R&D pipeline will allow us to deliver even greater insights and value on farm and orchards over years to come. Each trial builds a deeper knowledge and understanding of the products to be supplied to our customers. We learned firsthand how these products work in local conditions and the knowledge gained during these trials is fed directly to our frontline staff working with farmers and growers. And results from the first trials, which were only commenced in September are expected from January 2026. And finally, I would like to thank our shareholders for your ongoing investment and confidence in PGW. We remain focused on delivering sustainable growth and long-term value, and we appreciate your continued support. So now I'd like to invite Stephen, our Chief Executive Officer, to provide an operational overview. Thanks, Stephen.

Thank you, Garry, [indiscernible] good morning, everyone. I'm pleased to be here with you today as part of this presentation. PGW recorded cash flows from operating activities of $12.4 million for FY '25 and included significant growth recorded as cash flow -- cash outflow in our GO-STOCK receivables. These increased by $28.9 million over the 12 months to 30th of June 2025 to $81.4 million. PGW amended and extended its syndicated banking facilities during the year. As at 30 June, PGW had 1,554 permanent employees, permanent and temporary employees. During the year, PGW engaged casual employees, commission agents and specialist consultants, bringing the total headcount to 1,882. We refreshed our people and safety strategy to prioritize future workforce needs aimed at attracting and retaining talent. We recognize that our people are our greatest asset, and we are focused on driving a culture of excellence and safety, ensuring employees are supported and engaged with the business. In the past year, our commitment to enhancing our safety culture has continued to be a priority. We partnered with impact training to deliver a program of focusing on health and safety and well-being fundamentals and also created safety, induction training, mental fitness at work and online modules to address critical risk controls. Management of critical safety risk is a priority for the business and significant progress has been made in defining the safety practices and expectations. PGW successfully implemented its business information program, reaching go-live with Microsoft D365 platform reporting platform on April 2025. This milestone marks a significant step forward in modernizing our systems and strengthening our operational capabilities. With the implementation now complete, our focus has shifted to unlocking the full value of this investment. Key outcomes include improvements that will drive operational efficiencies, enhance data utilization and generate deeper insights to support decision-making. Our sustainability and climate statement for 2025 marks PGW's second year of reporting under New Zealand climate standards and demonstrates a maturing understanding of our climate-related risks and opportunities. As Garry has mentioned earlier, PGW is pleased to report a 22% reduction in greenhouse gas emissions for FY '25 against the FY '21 baseline. This is primarily driven by an overall reduction in vehicle fuel consumption and more hybrid vehicles entering our fleet. The period also saw the launch of PGW's comprehensive climate transition plan. The plan articulates our systematic approach to climate risk management with changing macroeconomic conditions, land use change impacts and alignments with New Zealand's decarbonization trajectory. The Climate transition plan establishes measurable objectives and priorities that will govern our transformation and drive sustainable practices through our value chain. The plan positions PGW to deliver stakeholder value, while contributing to New Zealand's climate objectives and resilience in the rural New Zealand. I'm now going to move to discuss the business unit financial results. Firstly, the Retail & Water business. This business incorporates the Rural Supplies, Fruitfed Supplies, Water and Agritrade businesses. PGW's Retail & Water Group recorded operating EBITDA of $42.2 million, an improvement of $1.1 million or 3% on the prior year result. Our Retail & Water's Group revenue was up $39.4 million or 5% to the prior year to $773 million. While the operating environment over the year was more challenging in the retail space, we're encouraged with the revenue growth in the context and pleased to see business continue to consolidate and grow market share. Retail & Water refreshed its 5-year plan with a focus on a range of growth initiatives. The acquisition of the Nexan Group, the launch of BlueAg, which Garry has touched on earlier, are the key examples of such initiatives. Our rural supplies business performed solidly as sentiment in the farming sector improved over the year and the strengthening in export commodity prices. This has been pleasing to see in the diary sheep, beef and farmers, all benefiting from strong international demand and increased returns, which helped our farming operations return to profitability. While sales revenue dropped -- sorry, while sales revenue improved, what a differently. As revenues improved on the prior year, farmers took a generally conservative approach with many years of good returns to reduce the balance sheet debt. Fertilizer and stock food were in demand as farmers focused on increasing production in response to good commodity prices. However, the arable sector has been more challenging with reduced demand in seed crops. Fruitfed suppliers has also faced a more challenging trading environment in FY '25, despite the headwinds and maintained its strong market position. Encouragingly, we have seen renewed optimism in both kiwifruit and apple sectors. Orchard investments, new plantings and a focus on varietal development signal confidence of the future of these crops. Buoyant export demand improved post harvests performance and stable pricing, having contributed to a positive outlook for these growers. The viticulture and vegetable sectors have been less bouyant. Viticulture market conditions are subdued due to the global oversupply of wine. Market pressure have impacted on grower confidence and investment decisions in some categories. There's limited development work for our water business in the first half of the financial year. However, the team experienced a momentum shift in the second half of the year in response to the positivity in the dairy sector in particular, which lifted investment confidence in irrigation development. Agritrade, our household business division traded well at the revenue level. The year was marked by some strategic investments and implementation of growth initiatives, which Garry has already commented upon, including the acquisition of the Nexan Group, which remains a strategic investment in the animal health category and the launch of our private BlueAg ag-chem range. The agency businesses. Our Agency Group incorporates the livestock, wool and real estate businesses, delivered a strong turnaround led by the livestock and real estate businesses. Operating EBITDA was up an impressive $11.1 million or 91% to $23.5 million. Revenue was $201 million, up $20.3 million or 11%. Our livestock business recorded exceptional financial results on the back of elevated meat pricing and increased volumes of beef and dairy cattle. The July Federated Farmers' Confidence survey confirmed a strong lift in farmer sentiment. This has been driven by easing of interest rates, more stability and input costs, improved commodity prices and government policies viewed as more supportive of the sector. Farm profitability rebounded, strengthening investment spending and production expectations. Strong demand for cattle drove livestock prices and to record levels. Pricing remained high throughout the year due to process demand, good feed reserves and robust beef schedules. Sheep pricing improved significantly year-on-year, particularly in the second half of the financial year. Elevated schedules allowed farmers to take advantage of prices with declining feed and dry conditions impacted production. The number of sheep transacted reduced as a result of the lower volumes due to land use change. Good pricing for diary resulted in strong demand and limited supply. Livestock pricing was buoyed by the forecast milk price. There's also been strong contracts for dairy food sales. Stud stock sales rebounded as clients return to the market with an increased demand for sire bulls which set record prices during the selling season. Our GO-STOCK sheep, beef, dairy and deer products experienced strong demand. Declining interest rates improve feed availability in the South Island, higher stock values and improved meat schedules resulted in steady uplift in GO-STOCK contracts. Our strategic priority for the livestock business is strengthening and growing our supply chain partnerships with preferred meat processes. These relationships add value to PGW and our customers by providing consistent, high-quality service, certainty flexibility -- flexible contracts and finance options. Even though there are year-on-year reduction in the livestock sector meat process, it is pleasing that PGW has experienced growth of the volumes across most species and to our supply chain partners, indicating a growth in market share. Our bidr online trading platform is well established in the livestock sector and its database of buyers grows year-on-year. The growth is driven by continued demand for hybrid integration, online bidding and live streaming of cattle sales at saleyards and on-farm auctions. bidr hosted over 1,000 auctions during the year and has firmly established itself as New Zealand's leading online auction platform for livestock. It's been a challenging year for the wool production due to difficult growing conditions and notable decline in shearable sheep, leading to a reduction of bales handled across our stores. The wool season concluded with improved wool prices, while there remains significant room for improvement to create a profitable future for our wool growers. PGW partnered with an iconic Kiwi brand, Norsewear to strengthen the value of ethically produced New Zealand wool and to support domestic manufacturing. The partnership connects PGW growers directly with manufacturers, trusted manufacturers delivering better returns for growers through long-term contracts, wool integrity, PGW's wool assurance brand -- I'll start that paragraph again. Right. Here we go. PGW partnered with iconic Kiwi brand Norsewear to strengthen the value of ethically produced to sell more and to support domestic manufacturing. The partnership connects PGW growers directly with trusted wool manufacturers, delivering better returns for growers to the long-term contracts. And just a side note there, there's a country calendar article on the 2nd of November. If you're interested with, it's about that partnership. So we just want to keep an eye out for that. Wool Integrity, PGW's Wool assurance brand certifies that wool meets all trading standards and animal welfare and sustainability. Our export -- our wool exporting subsidiary Bloch & Behrens, increased wool export volumes. This was particularly pleasing given more volumes exported from New Zealand declined during the year. Improved sentiment of the real estate market has continued, contributing to a pleasing profitability for PGW real estate with revenue activity up by 55% on the same period last year. The market has been buoyed by the gradual downward trend in interest rates, stronger dairy payouts, robust red meat pricing and farm gate prices breathing confidence into the sector. The volume of property listings and sales activity has reached levels not seen for some time, strong performance, reflecting the continuation of strong demand in the red meat and dairy sectors. Our achievement this year are a direct result of the dedication, resilience and talent of our exceptional team. Across the country, our people have demonstrated commitment to our customers, communities and each other. We extend our sincere thanks to our customers for their loyalty and trust. Their continued support motivates us to deliver outstanding service and solutions whether in challenging market conditions or in times of growth. I'll now hand back to Garry to give some further comments around our outlook.

Thank you, Stephen. I'll now provide with an overview of the -- sorry, I'll now give you an update on the current outlook. The ag sector experienced a strong rebound supported by buoyant export commodity prices and solid consumer demand leading to boosted confidence in production decisions by our customers. Economic conditions, including easing inflation and interest rates, together with greater stability and input prices have created a more positive environment for the primary sector. And these factors have contributed to renewed optimism and a noticeable lift in farmer confidence, which is positive for the sector and our rural servicing operations. Despite the momentum, forward-looking sentiment is not uniform across the entire agri sector with more challenging operating environments, existing for arable farming, viticulture and strong wool. While dairy and red meat markets remain resilient, caution continues to influence parts of the sector, reflecting a mixed but stabilized outlook for New Zealand's primary sectors. Strong commodity prices are expected to remain throughout the full year 2026 across dairy, red meat and horticultural crops, in particular, kiwifruit and apples. And overall, the outlook is positive. Confidence in the rural real estate market is expected to continue through full year '26, with quality listings continuing to attract interest in farm sales. Indications are that customers are using the elevated farm gate returns to reduce debt, while those who have deferred investment decisions and now are reengaging and investing to support their production decisions. While there's a bit of a mixed picture across the New Zealand economy with some industries facing difficult trading conditions, the agricultural sector is a bright spot and is leading the recovery, again, with strong export prices and payouts. The sector's strong fundamentals and market positioning provides a solid foundation. Supported by our strength and technical expertise, innovation and enduring customer relationships, PGW is well positioned to support our customers grow their businesses and capitalize on the forecast growth in export revenues. While it's very early in the year and the key spring growing season is still ahead of us, PGW is cautiously optimistic about the balance of the year ahead. And based on current market signals and trading patterns, we anticipate delivering a full year forecast above $60 million EBITDA for the financial year ending 30 June 2026. We would expect to be in a better position to reassess this forecast and update the market following completion of the key spring trading period. So on that note, I'll now move to questions in relation to our presentation. Any questions from shareholders or their proxies from the room and then online. And if you are present, please wait until the microphone is provided to you and please state your name. So do we have a first question? David?

Yes. [ David Temison ] shareholder. I was interested to hear about your Nexan acquisition during the year. It certainly looks like a good one. But one thing I noticed was that you didn't mention anything about how that acquisition would affect your EBITDA going forward or net profit going forward? So there's a lot of information about the actual business, but very little information about how it would improve PGW's profitability. I'm wondering if you could -- I mean, given you must have gone over the business thoroughly and discussed it at Board level and business level, I'm sure you have some numbers in the back of your mind as to what's it's going to contribute. So I wonder if you're willing to share a bit of that information with the shareholders' meeting, please?

We'll share what we can. I'll probably hand it up to Stephen. But you're correct, in so far as, yes, we did look at it very carefully. The due diligence was over a long period of time. We also knew this business for a decade or thereabouts. Multiples quite a commercially sensitive topic. And in this space, there's a lot of competition in chemicals and VetMed applications. So would be a bit reluctant to go too fully into the detail of the acquisition other than to say it fitted neatly with our strategy. And having operated the business for some months. There's been no surprises, and we're pleased with where it sits. I'm conscious I haven't given you any numbers. But Stephen, anything to add there?

If I pushed this, can you hear me okay?

Yes.

Exactly right, Garry. The market is very competitive in the space. We're also very conscious that we sell the product brand out through our competitors as well. So that creates some additional sensitivity. So hence, we haven't disclosed, I understand the interest in this topic, but I reinforce the point that Garry made that the business is trading well over the first couple of months. And that's actually a credit to both the team -- the implementation team, the Agritrade team and the brand presence within the marketplace. So we are pleased with how the results are tracking in those first 2 months of trading. So doesn't answer your question, David, but I hope that gives you some confidence that we are seeing the things that we hope to see, starting to translate through to the bottom line for shareholders because, the board is very conscious that any investment we make has to create value for shareholders. That's one of the criteria that we have as far as in the investment strategy.

I think in your report, you actually mentioned about creating value for shareholders. And did I read it was right, you were looking at the 10% return on your investment, is this kind of a base goal? So working with that, if you spend around $20 million on the company, we're looking at what a $2 million increment just following your figures. Is that a fair conclusion?

That's a reasonable methodical assumption. Of course, this business is a manufacturing business. So we're not only capturing the front line margin that we captured previously. We have additional wholesale manufacturing margins. Yes, it does come some of the support costs around marketing, et cetera. So but it's a good mathematical assumption on your part, David.

I might leave it at that. Just while I've got the microphone before I forget, your annual report, it's something we've almost taken for granted, but I just thought I'd better mention. I'm very impressed at the presentation, the advertisement for New Zealand agriculture. And looking back over the years, you've kept at a very high standard. And I just wanted to congratulate the people who put it together because I think it's a real credit to not only to yourselves but just advertising, how New Zealand agriculture is pictured in the world. So I just wanted to make that comment.

Yes. Well, some of the people that you were talking about there, David are actually in the room here. So we will just acknowledge them. But we also -- it's a testament to the support from our customers and farmers up and down New Zealand. A lot of those photos come from our farmer base. Our team is well down the road. So testaments some of the engagement we have -- but we are very proud of that. And you'll see some of the photos further online and we put those up online and our calendar, which comes out shortly, too. So yes, but it's one of the pleasures of being in agriculture. You do get some great photos, but you need to be able to take them. You must have more clearly ones than that, David. Common.

We have one question online.

We have an online question.

Shareholder association in relation to our [indiscernible] assurance for greenhouse gas emissions. And Michael is going to come and join us and speak to that, well he's got the question and he'll be able to articulate a response. Michael...

So Michael Anderson is our sustainability manager here in PGW and is one of the driving forces behind our Sustainability Report. So we're most pleased to have Michael as part of our team. So you get speaking rights today, Michael, which is -- we do see you regularly at the Board table and the executive table, but you have made the shareholder meetings.

And I'd just like to endorse what Stephen, said, I mean, Michael's knowledge around this sustainability and climate change has been a breath of fresh air to have someone of his caliber on our team, producing what is in effect a new report, part of the statutory requirements for public companies. And he does a splendid job in an area that is very, very complex.

Excellent. All right. Thanks for that introduction. So just repeating the question for everyone in the room. We have a question that we've got limited assurance over our Scope 1 and 2 greenhouse gas emissions for which we engaged oxygen consulting this year. However, Scope 3 emissions have not yet been disclosed and we're explicitly excluded from the assurance scope under the adoption provisions. Other sustainability disclosures in the report remain unaudited, and the New Zealand Shareholders' Association encourages PGW to progressively broaden the scope of our limited assurance to cover a wider set of our climate-related disclosures in future years and have asked for our comment. So in line with the legislation, PGW has chosen to use the adoption provisions to defer the disclosure of scope 3 emissions. And so for everyone's understanding, our Scope 3 emissions are the emissions that are associated with our value chain, that submissions that are directly outside of the control of PGW from the likes of our suppliers through to the business right through to our customers and all of the intermediaries along that journey. So we chose not to disclose them at this stage to give us more time to improve the methodologies of the calculation and the estimation techniques and that we use to calculate these emissions. Data collection for Scope 3 emissions has remained challenging, particularly as a number of businesses within our value chain are not actually included under the New Zealand Climate-Related Disclosures framework. So they have little incentive to be providing a greater insight to their business when they are not legally obligated to. We have also chosen to voluntarily report under the Global Reporting Initiative standards, the GRI standards. We do this because that adds additional credibility to our sustainability reporting through assurance to external standards. At this stage, we've chosen not to seek assurance over these voluntary disclosures as we are at this stage, we see it's unlikely to add significant additional value to us in seeking assurance over this component, but we'll continue to assess this approach annually and to ensure it's meeting the expectations of our broader stakeholders. Thank you.

Hold on, Michael, I couldn't have said that any better. Do we have any further questions? All right. We'll keep on moving. We now come to the formal business of the meeting. Being the ordinary resolutions in relation to the reelection and election of directors and authorizing the Board of Directors to fix the remuneration of the auditors. The resolutions and accompanying explanatory notes are set out in the notice of meeting. And the proposed resolutions will be determined by a poll that will be undertaken by our share registrar, Computershare as scrutineers. So the first resolution relates to the reelection of Sarah Brown as an independent director, and Sarah's biographical notes are set out in the Notice of Meeting. Sarah joined the Board on the 30th of April 2019, and being eligible offers herself for reelection. And the company's directors wish to note the specific expertise and experience that Sarah brings to the Board as noted in her biographical notes and recommend shareholders' vote in favor of Sarah's reelection. Would you like to say anything, Sarah? Right. Okay. So that's the first resolution. The second resolution relates to the reelection of myself, Garry Moore, as an independent director. And my biographical notes are set out in the notice of meeting. I'm currently an independent director and joined the Board on the 1st of July 2022 and being eligible, offer myself for reelection. The company's directors have informed me that I have a specific expertise and experience. And as noted in the biographical notes and recommend that shareholders vote in favor of my reelection. The third reelection relates to our most recent appointment, the election of Wilson Liu as an independent director, and his notes are set out in the meeting. He joined the Board on the 1st of July 2025, and being eligible offers himself now for election. And the directors note his specific expertise and experience and recommend shareholders vote in favor of Wilson Liu's election. I'd just like to go a little bit further than that. Wilson brings something to the Board that has been desirable for a period of time, which is knowledge of some Asian markets, a wealth of experience as a senior partner in KPMG, sorry, PwC, I should have written it on there. PwC, sorry, Wilson. He was currently Director of 3 public companies in different jurisdictions, China, Singapore, Hong Kong. He spends his time roughly 50-50 between Hong Kong and Melbourne. We have given him a reasonably good induction. We've shown him around some of our sites, taken to the saleyards. Got his boots steady. And while his background is not necessarily agriculture, he brings that knowledge, particularly of some of these Chinese markets, which are very, very important to us for things like -- [velvet], wool, product sourcing relationships with suppliers. So I'd like to invite Wilson to say a few words because he's a fresh face. And as I said before, the directors recommend unanimously that you vote in favor of Wilson. Wilson?

Thanks, Garry. Thanks for your introduction. First of all, I'm pleased to attend first shareholder meeting and in fact, I'm honored to be able to serve on the Board of PGW together with my fellow directors. As Garry -- well, he sort of say that both New Zealand and agricultural industries are new to me. But having said that, this is again a good challenge for me as well and good stimulation. And with confidence, I'm sure with my other prior experience, for example, as audit partners of PwC for 23 years, really covering the Asia Pacific area in different industries and also currently sitting in the Board of 4 listed companies, actually. I just resigned from 1, so 3, which is absolutely correct. Covering the 3 different stock exchange and jurisdictions. I'm sure I would be able to give some good ideas and best practice to PGW Board and add value to the Board and PGW. Last but not the least, of course, add to shareholders' value and looking forward to many, many good years and I'm really, really exciting of that. Maybe I'll stop at that. Thanks, Garry.

Thank you, Wilson. The fourth and final resolution is to authorize the Board of Directors to fix the auditor's remuneration for the financial year for the purposes of Section 207S of the Companies Act 1993. And as is usual with audit fees, it is impractical to fix the remuneration at the beginning of the year. Accordingly, the Board seeks authority from the shareholders of the company to fix the audit fees or at the appropriate time. Now are there any questions in relation to any of the 4 resolutions? Okay. No questions. Thank you. So I'll now move to the resolutions 1, 2, 3 and 4. As set out in the notice of meeting be put to a vote by way of 4 separate motions as ordinary resolutions. A poll will be conducted in respect of the resolutions. For those who have not cast votes already, please do so now by clicking on the Vote tab on the right-hand side of your screen. For those present who have not yet voted, please complete your voting paper and when completed, if you just raise your hand and someone from Computershare will come and pick it up. No, sorry. My notes say when completed, please hand it at the back. But anyway, is there any -- there's a couple there. That's 3. Okay. Okay. While we're waiting, I can address further questions if there are any. And voting online will now close and the votes will be counted by the scrutineers. The results of the voting on the resolutions will be released to the NZX later today. So the meeting is now open to general business or time for any more questions from shareholders or proxies in the room or online or if there's any other matter that you would like to discuss in this forum. Well, well, everyone is obviously keen to get into that cake. Sorry, David, another one? Yes.

Sorry, I don't want to monopolize the question but...

No. No. Bring them on.

Last year, Garry, you had a clear message that the dividend level would be moderated because you thought it was important to reinvest in the company in certain areas. And certainly with the Nexan acquisition, you've certainly done that. But what I'm wondering is, is there a policy going forward in terms of like the percentage of earnings we might expect as a dividend going forward? Or is it very much hit and miss basis? Or what's the policy now?

No. It's not hit and miss. Thank you for the question. I'm not sure I gave a clear message last year, but nevertheless, some people picked up on it. But the policy is articulated online. We consider about 7 or 8 different metrics before determining landing on a dividend. Foremost in there will be always cash flow, balance sheet and some of the potential acquisitions that may or may not be in the pipeline. You've seen 2 or 3 of those this year just gone by, Nexan wasn't the only one. The development of the research center and our BlueAg strategy. Dividends, reinvesting back into the business is what good companies do. Good companies also grow the dividends over time. That's not to be taken as a hint. That's the strategy. We do not have a percentage, we do not fix a percentage of net profit after tax. We look at all things in the mix. And foremost is what's in the best interest of the company. So that's about all I'd like to say on dividends at this stage.

Would it be fair to say you wouldn't expect the dividend to reduce in the coming year? Would that be a fair enough comment, considering you...

That would be a theory-ish sort of a comment. I think we've made it pretty clear that we're determined to sustain dividends and sustainability normally means to at least hold. I won't be drawn on what we think dividend might be. At this stage of the year, we're only a few weeks into our most important trading period. Almost half of our revenue comes in the 4 months up to Christmas and almost 3/4 of our EBITDA in that same period. So you can tell about the weather today, it's not very warm out there. The season is sort of a week or 2 behind normal, and a lot can happen. So I don't want to be drawn on a future that I can't or no one else can predict. Okay. Well, I'm going to close the meeting. That completes the business. And the documents from today's presentation on our website. And we will post a recording of the meeting later today. So on behalf of the Board of Directors and our management team present, I thank you for your attendance and ongoing support and welcome you to stay on and join with the team for some light refreshments and a slice of this cake celebrating PGW's 20th anniversary of the PGG and Wrightson merger. Thank you for coming.