PGG Wrightson Limited (PGW) Earnings Call Transcript & Summary

Good afternoon, everyone. I'm Rodger Finlay, Chairman of PGG Wrightson Limited, and I'd like to welcome you to our 2021 Annual Shareholders Meeting. I'm pleased to host our first Virtual Annual Shareholders Meeting after we unfortunately had to postpone our in-person meeting in Napier in October due to the uncertainty surrounding COVID-19 and alert level restrictions. As always, the Board's main concern was keeping shareholders, guests and our employees safe. We look forward to hosting future meetings in the Hawkes Bay. I'd like to thank you for your understanding and patience with the change of arrangements for our meeting. Today's meeting is being held via Computershare's online meetings platform, which allows shareholders, proxies and guests to attend the meeting virtually. All attendees can watch this live webcast of the meeting and read the company's documents associated with the meeting. Like our normal in-person meetings, shareholders and proxies can submit questions and cast votes. If you have a question to submit during the live meeting, please select the Q&A tab on the right half of your screen anytime, type your question into the field and press send. Your question will be immediately submitted. Should you require any assistance, you can type your query, and one of the Computershare team will assist with the chat function and reply to your query. Alternatively, you can call Computershare on 0800-650-034. Please note that while you can submit questions from now on, I will not address them until the relevant time in the meeting. Please also note that your questions may be moderated. Or if we receive multiple questions on 1 topic, they may be amalgamated together. And finally, due to time constraints today, we may run out of time to answer all your questions. If this happens, we will answer them in due course via e-mail. Accordingly, I encourage you to ask your questions early to ensure we can answer them at the end. Voting today will be conducted by way of a poll on all items of business. In order to provide you with enough time to vote, I will shortly open the voting for all resolutions. At that time, if you are eligible to vote at this meeting, you will be able to cast your vote under the Vote tab. Once the voting has opened, the resolutions will allow votes to be cast. To vote, simply select your voting direction from the options shown on the screen. You can vote for all resolutions at once or by each resolution. Your vote has been cast when the tick appears. To change your vote, simply select to change your vote. You have the ability to change your vote up until the time I declare voting closed, which will be at the close of the meeting. I can confirm that we have a quorum. And accordingly, I declare the 2021 Annual Shareholders Meeting open and voting is open on all items of business. The resolutions will now be available in the vote tab and please submit your votes at any time. For the benefit of those who are unable to attend today, I note that we are recording this meeting, and this will be posted on our website later today. Before we begin the formal business of the meeting, I'd like to introduce the Board of Directors who are attending our meeting today online. We have our Deputy Chairman, Joo Hai Lee; Independent Director and Chair of our Audit Committee, Sarah Brown; Director, U Kean Seng; and Independent Director, Dr. Charlotte Severne. A number of members of the executive team are joining the meeting online but will not be actively participating in the call. I'd like to acknowledge also that we have Bruce Loader from our auditors, Ernst & Young, joining online. No apologies have been received. The Company Secretary has confirmed that the Notice of Meeting was sent on the 15th of November 2021 to all registered shareholders and to other persons entitled to receive that notice. I confirm the minutes of the company's previous Annual Shareholders' Meeting held on the 20th of October 2020 in Blenheim were approved as a true and correct record at the Board meeting on the 7th of December 2020. The meetings of the meeting -- the minutes of the meeting are posted on the Shareholder Information section of our website. The financial statements and the reports of the directors and auditors for the year ending 30th of June 2021 are set out in the company's annual report. On the 28th of September 2021, the annual report was posted on the company's website and on our NZX page, and a copy of the report has been sent to shareholders who had requested one. GAAP and non-GAAP performance measures. Please note that we will refer to both GAAP and non-GAAP performance measures. We use operating earnings before interest, tax, depreciation and amortization or operating EBITDA as a key measure of performance, and I encourage you to refer to our full accounts for details of how this relates to GAAP measures. I can confirm that 192 shareholders have appointed proxies for the purposes of this meeting in respect of approximately 36 million shares. So I've covered the opening formalities, and I'll now move to the general business of the meeting. I will begin by providing an overview of the highlights of 2021 financial year, and then I will hand over to our Chief Executive Officer, Stephen Guerin. Stephen will provide the financial and operational overview of individual businesses, and he will also summarize how our business is trading for the current financial year to date. I will conclude our presentation by discussing our forecast guidance, which we announced on the 19th of October and updated again this morning. And opportunities to respond to questions will follow before we move to the formal business of resolutions that will be put to the meeting for voting. As outlined in the Notice of Meeting, the business of the meeting comprises 3 ordinary resolutions: relating to the election of Dr. Charlotte Severne as an Independent Director; the reelection of U Kean Seng as Director; and confirming the appointment of Ernst & Young as auditor and also authorizing your Board to determine our auditors' fees. Stephen and I will refer to PGG Wrightson as PGW throughout our presentation today. Our team and the business have again proved that they are leaders in the field in supporting our customers, the agri sector and rural communities to deliver an excellent result. The financial year started and finished strongly with year-end operating EBITDA at $56 million, which was up $13.8 million or 32.8% on last year's COVID-19 impacted result. PGW also delivered an NPAT of $22.7 million, which was up $15 million on the prior year. These results further substantiate the decision taken to divest the Seed & Grain business some years ago, allowing us to recalibrate our cost base and our systems and extend our core technical service offering and product range. Our total shareholder return was a positive 30% for the financial year ended 30th of June 2021. This represents impressive value creation for shareholders and reflects well on the health of the business and our trading performance. The directors are particularly pleased that the business backed up the strong first half result and continued to trade well over the second half. This result reflects the collective efforts of our dedicated team who are passionate about the rural sector, supporting our customers and the role they and the sector plays for New Zealand. We have seen just how important to New Zealand's success the primary sector is and this is coming to stark focus during global pandemic. As a business, PGW is clear about our strategy of driving for growth by providing our customers with sector-leading expertise and innovative solutions for their farming and production needs. We look to lead the market through the specialist knowledge and technical expertise of our people, which we foster through investing in their leadership and capability and in identifying and bringing to market new products we source and trial in New Zealand conditions. Our customers value PGW's technical offering and see this as a distinguishing strength that we will continue to develop. Our strong balance sheet also allows us to contemplate earnings accretive growth ambitions. The PGW Board had 2 changes to its membership during the year. David Cushing retired from the Board on the 30th of April 2021, having served as a Director and Chair of the Audit Committee for 2 years. The Board has previously acknowledged and thanked David for his excellent contributions as a director during that period. Dr. Charlotte Severne joined the Board as an Independent Director on the 18th of June 2021, and we will talk more about Charlotte's experience and what strength she brings to this Board later in this meeting. I will now discuss our performance -- financial performance highlights. Our operating EBITDA was $56 million, which was up $13.8 million or 33%. Our net profit after tax was $22.7 million, up $15 million. Operating revenue of $847.8 million, an increase of 7.6%. Our gross profit was $223.2 million, which is an increase of 9.4%. Our net cash flow from operating activities of $57.7 million, which was up an impressive 83.4%. And as I mentioned earlier, the total shareholder return was a positive 30%. Fully imputed dividends for the year of $0.28 per share, which was supported by the strong full year earnings. I will now ask Stephen Guerin, our Chief Executive Officer, to provide an operational overview.

Thank you, Rodger. Good afternoon, everyone. I'm delighted to be with you today to update you on the performance of the business. We did indeed deliver an impressive result for the financial year. There were periods during the year where our stores and operations at the Greater Auckland area were impacted by COVID-19 restrictions due to various official pandemic alert levels, which also continued into the current financial year. Some of our business units were deemed essential services during these periods, and were able to contribute to supply the services to our customers. Our teams were outstanding in their response to these disruptions, as they adapted to the required protocols and they continued to serve our customers in safe and innovative ways. The outlook for the rural sector is positive, and farmer and crop confidence is encouraging. Pricing for these key agricultural exports were held up -- has held up well and is expected to remain strong as exports are predicted to reach new highs next year. Continued strong demand is expected for lamb and sheep meat with cattle prices also expected to remain high. Dairy farmer sentiment is positive for solid payout predicted next year as we see in the recent announcements from Frontera. The rural sector of farmer sentiment continued to see some challenges. Labor shortages remain concerned with growers struggling to harvest all their fruit and crops in the past season. The uncertainty of the workforce has also seen some growers put development plans on hold until they could get some surety around access to labor. Farmers, particularly dairy [indiscernible] skilled labor. The processes are also continuing to see fewer workers. Shipping delays continued to cause disruption at the supply chain. Though there continues to be demand for New Zealand prime meat products, farmers at growers are cautious of the challenges with getting their products to market. These constraints are also added cost pressures on imported inputs. Our supply chain [indiscernible] the magnificent job and focus on how we mitigate these issues for our customers. Regulatory change and compliance are increasing costs and put pressure on the sector as farmers and growers [indiscernible] respond and assist the lower the level of investments needed to achieve the required compliance. Land use changes across the country are progressively altering regional landscapes and increased support culture in [indiscernible] costs has seen a number of growers diversify their portfolios and vested these areas, which creates significant sales opportunities for our Fruitfed Supplies business. It's also evident that farmland has been lost to forestry, the sheep and beef farmers being converted at a rate that is causing concern in some regions. As is generally the case, some of our customers and their growing operations were impacted by a range of climatic conditions. Hailstorms across the Christmas, New Year period last year caused severe damage in parts of the South Island, the number of crops[indiscernible] off. While drought conditions were experienced in the first half of the financial year, with much of the use case experience at low soil moisture levels. However, these conditions were abruptly ended Canterbury West Coast of Marlboro at Tasman following several significant flooding events. Turning to our cash flow and debt positions. PGW experienced strong operating cash flows during the year, which benefited from excellent operating EBITDA performances and a focus on working capital management, including receivables in particular. This focus has seen PGW's overdue debt balance track at historically low levels. Capital expenditure of $6.8 million was $2.3 million lower than FY '20 year, and was impacted by slowing in the implementation of projects as a consequence of COVID-related disruptions. Net interest bearing debt was $6.5 million as at the 30th of June 2021. It is the last reported at 30th of June and over a decade. Apart from 30 June 2021 where we had cash on hand from the sale of the PGG Wrightson Seeds business before the capital distribution to shareholders in August 2019. Turning to our operational highlights. Some of the operational highlights we achieved over the year included the following: Our Fruitfed Supplies technical R&D team conducted more than 70 product trials and have facilitated over 50 [grower meetings] nationwide; revenue for our independent wholesale business, Agritrade, grew by 8% in the financial year; our Real Estate business sold 31% more properties compared to FY '20; our people completed over 9,000 online learning modules; our health and safety total recordable injury frequency rate, or TRIFR as we refer to it internally, has reduced by 51% since 2018 financial year baseline. Turning to our business unit financial results. I now want to focus on the Retail & Water agency business -- Retail -- sorry, I want to focus the 2 operating groups being the Retail & Water and then the Agency business. The Retail & Water business incorporates raw supplies, Fruitfed Supplied, Agritrade, and Water. Retail & Water's operating EBITDA was at pleasing $37.5 million and was up $4.3 million on the prior year's result, an increase of 13%. Both our Rural Supplies and Fruitfed Supplies business has traded very well this year. We continue to increase market share. Much of this growth was attributed to superior technical ability of our staff. We have a very stable workforce that are well supported by our specialist technical and research and development teams. A challenge that we're managing like many other businesses, is the disruption of international supply chains. This disruption will continue to have an impact on the timeliness of source of the product and grow our imports as well as exports to offshore markets. Our team continues to work proactively to minimize the supply chain disruption. Our teams have been working collaboratively with key suppliers, curing and packing product into stock earlier and work with customers to lock their essential requirements 3 to 6 months earlier than would ordinarily be the case. Following the launch of our e-commerce website June 2020, we are focused on improving our user experience and expanding our product range online. We are pleased with the way that new e-commerce channel has contemplated our -- complemented our existing store and [Audio Gap] During the year, we relocated 3 new stores, Taupo, Darfield at Alexandra. And we've also undertaken a major store refurbishment in Mayfield to our continual program to improve our store network. This has enhanced the retail experience for our customers and improve the work environment for our staff at those locations. Our Raw Supplies business was particularly strong -- our Raw Supplies business experienced particularly strong growth this year with an excellent result in a highly competitive market. The success is attributable to both new customers who have brought their business to PGW and also growth in market share as customers respond positively to our value-added technical offering and advice. We have employed some great new talent in our business, have brought fresh ideas and in some instances, new business. Our sales culture has grown through continued investment in our people and by providing more trading opportunities across all levels of our business with a focus on sales and service. We are promoting Raw Supplies more actively by showcasing our expertise in the field and promoting our store network. In support of this wool industry, our retail -- our PGW retail and wool teams collaborated with Norsewear that we are on a new apparel range. Manufacturer from a blend of South Island Merida and Northland Labs wool about this range includes wool [indiscernible] growers program. Our Fruitfed Supplies business has gained registration for another year -- sorry, our Fruitfed Supplied business has again registered another record year of both operating EBITDA and revenue. The business has diversified across a number of range of crops, and we're continuing to adapt to customer and market needs whilst horticultural sectors grow with increased investment and development. We enjoy impressive market share across the broad range of horticultural crops, with particular strengths in the grape, pit fruit, snow fruit and key [root] sectors. And we've continued to grow share of avocados, cherries and vegetable sectors. Our core focus remains to add value to our customers' business through the technical ability of our technical horticulture representatives by supplying specialist products and services. Our technical expertise offering is differentiated by our expert technical R&D teams to support our field and store staff. This team conducts a number of product trials on New Zealand conditions across the industry, investigate new products at key [indiscernible] to assist our grows, its suppliers to engage with -- as we engage with the district bodies. The industry remains buoyant, which is driving investment and development of the horticultural industry. New developments across several different crops continues throughout the country. Large grower businesses are invested in the horticultural sector, and as they look to diversify their portfolios, which had previously focused on beef and dairy operations. These developments continue to create sales growth opportunities for the Fruitfed Supplies business. Our reinvigorated Fruitfed Supplied marketing plan was [indiscernible] and delivered during the year. This has been a purposeful shift for Fruitfed Suppliers as we move to increase the profile of the business and put more of a spotlight on our specialist expertise. Our focus of this air [indiscernible] has been to increase the brand awareness also demonstrated our R&D capability and highlighted the value we add to our customers' businesses. Our wholesale division, Agritrade, which manufactures, sells and distributes a range -- a variety of products continued to demonstrate positive momentum. We had [indiscernible] worldwide supply chain disruption created by COVID-19 has presented challenges, and caused Agritrade to place orders and receive stock earlier than usual. Whilst the inability to travel internationally has happened new product sourcing and development opportunities, it has -- it was nevertheless pleasured to note that 5 new products were registered by Agritrade for the New Zealand market during the year which are being commercialized. We have reshaped the Water business to align with market conditions. This has resulted in an improvement in EBITDA compared to the previous year. Our full-service water and irrigation packages offered through rural water has seen improved sales. However, shipping delays will likely push out some of the delivery timelines in the short to medium term. Turning to our agency business. Our Agency group incorporates livestock, wool and real estate businesses. Operated EBITDA was $25.2 million which was up $9.5 million on the prior year's result, an increase of 61%. Our Livestock business has maintained market share throughout the country, where South Ireland achieving a very solid result. During the year, strong values were achieved by sheep and beef. Sheep farmers and dairy farmers also received increased payouts, which in turn underpinned market fundamentals of our livestock business. Our deer business experienced good -- a good [indiscernible] season, where values offset lower [venison] prices. We expected our GO-BEEF and GO-LAMB product offering and launched GO-DEER. Next year, we have expected to add to our GO-STOCK range with GO-DAIRY, which we anticipate will be well received and grow the GO-STOCK offering further. bidr, our virtual saleyard out has run over 400 auctions. It sold more than $50 million worth of livestock since its launch in 2019. bidr continued its software development and live streaming from our field Stortford Lodge and Frankton saleyards has been launched with others to follow as we roll out this technology. Excellent Livestock results throughout the year have culminated a bolt action series with bidr hybrid platform have to the fore. Better number of charity auctions raising money for causes such as Zelle, Land, Search and Rescue, Cystic Fibrosis New Zealand and Rural Support Trust. PGW has done -- well, sorry, PGW wool has done a good job at navigating the ongoing challenges that have been insinuated by COVID-19. Our team worked closely with growers to reduce their stockpiles of crushed red wool and we did see some benefit from improving pricing in the second half of the financial year. PGW wool saw additional 46,700 [bales] as compared to the previous year. Our export subsidiary, Bloch & Behrens New Zealand, [indiscernible] with overseas customers to ensure contracted obligations to our growers were fulfilled. We are passionate about supporting the wool industry and we're working place with industry bodies or initiative to tell their wool story to the world. Our commitment is recognized by our investment of the [indiscernible] Action Group becoming a founded member of the New Zealand Farmer Assurance program. We continue to grow our PGW Wool Integrity Program, which is a quality standard provided assurance to international marketplaces around important consumable expectations. Our global consumers are [indiscernible] recognized the positive attributes of wool and associated products and they have become more certain of their purchases. We anticipate an impressive shift from certain efforts to natural fibers, which will ultimately result in stronger returns for growers. Our Rural Real Estate business has been particularly strong -- has seen particularly strong demand across all sectors of the rural property market, which has been bolstered by lower interest rates. This result of the real estate business experience in the special [indiscernible] that over a decade at both operating EBITDA and gross commission income levels. During the year, we acquired the eid and Wilson Limited Real Estate business in Timaru and opened a new office in Lincoln, Canterbury. We've seen early signs of a positive spring, rural sales with more appraisals than usually taking place with the large number of listings coming to market, which we expect to turn to continuing solid demand. Strong commodity values in the rural sector, we anticipate a number of retirement and succession initiated listings coming to market. We are experiencing a strong buyer inquiry for rural properties. Shortage of residential lifestyle listings is expected to continue. During the year, we had a new joint venture insurance broker relationship with BrokerWeb Risk Services Limited, or BWRS as we refer to them internally, which was launched in February 2021. The insurance referral relationship was struck -- given structure with the strong strategic fit for both BWRS already holding solid presence and capability in the rural insurance market. Many of BWRS’s dedicated brokers were either raised or live rurally and they have local knowledge and access to market-leading insurance products and risk advice. They demonstrate the confidence of PGW has in the insurance provider and BWRS have been appointed as PGW's corporate insurance broker. BWRS offers comprehensive, flexible and tailored rural insurance solutions to meet the unique requirements of our customers. BWRS has created 3 bespoke products for our customers including rural, lifestyle and bull insurance. An additional benefit of this referral arrangement to our customers Is they have the convenient option of being able to pay their insurance policy premiums through their PGW customer account. Turning to the first quarter results for the FY year 2022. Our Rural Supplies, Fruitfed Supplies and Water businesses has traded well over the first 5 months of the financial year. Spring is the peak season for our retail network, which has seen good trading activity as our customers gear up to meet seasonal requirements. Our stores operate as an essential service [alert] level 3 and 4. Under alert level 2, our stores outside Auckland have continued to trade well. Our staff are doing an amazing job as essential workers working under significant guidelines to protect themselves and the communities they live and work in. They have again adapted and limited the appropriate protocols as we transition to the new COVID traffic light systems. Throughout September, our Fruitfed Supplies better operations were audited by the British Consortium Global Standards, which is a globally recognized acceptable food safety standard. The result of the audit was very pleasing and has confirmed to our customers they could trust our processes, our products are of the highest standard. The site was awarded AA-level certification, which is the highest grade achievable. A gold certification, we are demonstrating our commitment to meeting internationally recognized standards. This provides customers with confidence in [indiscernible] secured new business and clients. The [indiscernible] site is the first in our industry to achieve this certification and will seek certification for other fruitfed sites in the near future. The operations of our Water business has been impacted by the pandemic trading restrictions. During the quarter 2 of 2021, our water team completed 550 valley irrigation courses. And since then, we have completed and informed the team have achieved a number of #1 spot -- and we've been informed the team, we have achieved the #1 spot globally at the Valley University course of [indiscernible] for the quarter. Valley Irrigation is a worldwide leader in precision irrigation and have dealers at more than 550 countries. It place a lot of emphasis at keeping the dealers at the forefront of industry by the education and trading programs. It's a significant achievement for our water team to get this accolade as company result of a lot of dedication towards the strategic goal to become the preferred on-farm server provider of Pivot and Libya irrigation systems. Livestock and wool was significantly impacted alert level 4 lockdown in the latter half of August 2021. Saleyards were closed and wool was unable to hold auctions with subdued cross-bred wool prices since then. Beef and sheep prices have been strong and are expected to remain positive for the season ahead with demand exceeding supply and GO-STOCK products have been traded well. bidr enabled live stocks have continued during lockdown. As I previously mentioned, we successfully launched live streaming or bidr livestock options at Fielding, Frankton Stortford Lodge. Unfortunately, they're not committed at the same time due to Auckland COVID Alert Level 4 restrictions, impeding our ability to install fiber in [indiscernible]. However, we've been able to operate the technology recently, these yards using the same platforms as we used for on-sale farms at [indiscernible]. bidr has the capability to go to any saleyard in New Zealand and live stream an auction on request for large cattle feeders and will be a feature sales to account at our typical sale yards. The uptake and interest of hybrid live stream auctions from the [indiscernible] community has been very, very positive. At the beginning of September, bidr hosted New Zealand's first fully online bull sale, which attracted Trans-Tasman as but addressed and achieved record prices at auction. The real estate team continues to -- and business continues to perform strongly although behind last year's volumes and performance levels. Following the genreal trend, our e-commerce platform experienced a positive up sales through the lockdown periods. Our e-commerce presence has enabled us to grow the [indiscernible] of our product range and the lifestyle and residential markets and converted to online purchases. Thank you for listening to my story today. On behalf of the PGW team, I'll hand you back to our Chair, Roger, to discuss our group strategy reset. Thank you, Roger.

Thank you, Stephen, for providing an overview of the 2021 financial year and the first quarter of 2022. I will now briefly discuss the PGW's group strategy reset, which was launched internally to the business during August. As part of this exercise, the Board and the executive team took stock of trends and developments in the agricultural sector internationally and domestically to determine PGW's, while reflecting upon and respecting our proud history by concentrating on the future and growth opportunities for PGW. We also considered customer insights gathered from external market research to better understand customer perceptions and expectations. This work provided very clear observations relating to the deep customer relationships that PGW staff hold and the trust that our customers place in PGW came through strongly. A key insight that was reinforced was the value associated with the technical expertise we provide to our customers, the advice we offer to the industry and in turn the creation of value for our shareholders. At a more targeted level, we've identified 8 PGW group strategic priorities that will help direct our focus and the priorities where we wish to make progress and differentiate our offering while strengthening our position as a market leader. Our group strategy is dynamic and will continue to evolve as we respond to the changing demands of the market. The purpose of the PGW strategy is to provide clarity and direction at a group level around our strategic priorities that we will collectively work towards. The 8 priorities are then layered in more detail in the strategic objectives of each business unit and corporate function. Each of the 8 strategic priorities have specific measurable objectives that we will monitor progress over time. As part of our aspiration to continue to see growth, we will also seek out potential acquisition opportunities within the New Zealand market that complement PGW's strength and that had a good strategic fit, while also being immediately value accretive for the business. Turning now to outlook. We are 5 months into the financial year, and we've seen our strong first quarter trading performance continue. Spring is the busiest season for our retail network and we've seen positive signs as the business ramps up over the seasonal peak trading months. While our livestock business has been heavily impacted by COVID-19 related operating restrictions in recent months, confidence in the red meat sector continues with strong beef and sheep schedule pricing that is expected to remain positive for the balance of the season. The peak trading period for the livestock business is in the second half of the financial year. Pricing for crossbred wool remain subdued, while our real estate business continues to perform well, but with fewer lifestyle and residential listings. The ongoing uncertainties presented by COVID-19 and related operating restrictions, supply chain disruption and consequential market impacts continue to be a reason for us to be cautious about earnings projections. However, Aside from these external influences, the business has been trading very strongly year-to-date, and we are optimistic and expect to better last year's impressive performance and to be around $58 million at an operating EBITDA level. The Board is confident that the company is well positioned to continue to perform well and deliver on our PGW group strategy to grow the business.

Ladies and gentlemen, we will now respond to several questions we've received from shareholders or their proxies that we have received during today's meeting in relation to our presentation so far. First question is raised by Mr. Flexton, "Would it be possible to consider doing a combined meeting next year, i.e., a virtual meeting as well as a physical meeting?" I'm delighted to say Mr. Flexton that we will absolutely consider doing a combined meeting next year. Next question is, "I don't think that PGW currently has a dividend reinvestment policy. Are there any plans to introduce one in the future?" PGW previously had a dividend reinvestment policy but discontinued that a number of years ago. The Board has reconsidered this on several occasions, but has not determined not to reinstate the policy given the strong balance sheet. I have another question, the earnings guidance that the Board updated this morning. A question comes, "Guidance was raised to approximately $50 million of EBITDA. This is a decrease from the $53 million announced just over a month ago. What are the key drivers for this?" I sort of touched on it a little bit in my comments on the outlook. We have had a fantastic spring. We had a record earnings result in the month of November. And the business is trading extremely well. There's clear indication that we as a business are gaining market share. Our people have absolutely gone the extra mile to service the needs of the customer. So really, this is broadly a reflection from the Board this morning that the business has traded so well in November that we thought it absolutely appropriate to update the market. The last question I have, which I'm going to hand over to Stephen Guerin, "What is PGW's policy stance on the COVID vaccine mandate?" Over to you, Stephen.

Thank you, Chair. Clearly, there are a number of businesses that are contemplating this world. PGW is one. We have an obligation in terms of our business and our people, with our business to do a risk assessment. We are working our way through that process. And we are consulting with our staff around our response to vaccination policies. We, at this point in time, we haven't made a determination of what that looks like as we work through the consultation with our staff.

Thank you, Stephen. I don't have any further questions. There will be an opportunity a little bit later on to ask any other questions. So I'd like to just patch in this session by saying that PGW's impressive year would not have been possible without our exceptional team in the field, who this year, and I know I mentioned it at last year's AGM as well, the tireless work and commitment to our customers and the rural communities in which we live is greatly appreciated by the Board, and I'm sure by all shareholders. By living our values and adapting to the challenges faced, our nationwide team of over 1,700 people can genuinely demonstrate the dedication to our vision of helping grow the country. So on behalf of the Board and the executive team, we thank our shareholders and customers for their loyalty, trust and continued support. We would like to also acknowledge the extra length our suppliers, both domestically and internationally, have gone to in order to secure products for our customers during these testing times.

I'd like to move now to the business of the meeting and the resolutions. The resolutions relate to the election of our director and confirming the appointment of the auditor and authorizing the Board of Directors to fix their remuneration. The 3 resolutions and accompanying explanatory notes are set out in the Notice of Meeting. As usual, we offered shareholders the option to cast their votes on meeting business by post, e-mail and online today. Proposed resolutions will be determined by a poll that will be undertaken by our share registrar, Computershare. The first 2 resolutions relate to the election of Directors. And biographical notes for each director are set out in the Notice of Meeting. Resolution 1 is to consider the election of Dr. Charlotte Severne as an Independent Director. Charlotte's biographical notes are in the Notice of Meeting. Charlotte is an Independent Director and joined the PGG Wrightson Board on the 18th of June 2021. Charlotte being eligible, offers herself for reelection. The directors -- the company's Directors wish to note the specific expertise and experience that Charlotte brings to the Board as noted in her biographical notes and the Board recommends shareholders vote in favor of Dr. Charlotte Severne's election. Ordinary Resolution #2 is the reelection of U Kean Seng as a director. U Kean Seng's biographical notes are also in the notice of meeting. Unfortunately, U Kean Seng cannot join us in person today due to COVID-19 border restrictions. However, he has joined the meeting remotely and was able to join, obviously, our Board meeting -- our full Board meeting this morning. U Kean Seng is a current Director of PGG Wrightson Limited, and he joined the Board on the 4th of December 2012. U Kean Seng being eligible, offers himself for reelection. The company's directors unanimously recommend shareholders vote in favor of U Kean Seng's election. Ordinary resolution #3 is to confirm the appointment of Ernst & Young as auditor and to authorize the Board of Directors of PGG Wrightson to set the auditor's remuneration. As is usual with audit fees, it is impractical to fix the remuneration at the beginning of the year. Accordingly, the Board of Directors are seeking authority from shareholders of the company to appoint Ernst & Young as the auditor and fix the audit fees at the appropriate time. Thank you. So I will now move resolutions 1, 2 and 3 as set out in the Notice of Meeting by way of 3 separate motions as ordinary resolutions. A poll will be conducted in respect to the 3 resolutions. For those who have not cast your votes already, please do so by clicking on the Vote tab on the right side of your screen. That concludes the discussion -- our discussion on the items of business. In a minute, I'll close the voting system. So please ensure that you have cast your votes. While we are waiting, we may be able to address any further questions. And I will look at my moderator screen to see if I have any. And I don't. Thank you. The results of the voting on the 3 resolutions will be released on the NZX shortly. Ladies and gentlemen, the meeting is now open for any general business. Are there any further matters or discussion or any questions? I have none. So I hope that accurately represents all shareholders on this meeting, and we haven't missed anything. In closing, that completes the business of the meeting. and I therefore call the 2021 Annual Shareholders Meeting closed. The documents from today's presentations are on the PGW website, and we will post the presentation and the recording of this meeting there later today. Thank you all for your ongoing support of the company, and I look forward to seeing you at the same time next year. Thank you.