Seeka Limited (SEK) Earnings Call Transcript & Summary

Welcome, everybody. Sorry to hold you up, but the advertised meeting time was 2:30 PM, and I will now start the meeting. It's now 2:30 PM. So welcome to everyone, and thank you for your attendance and obviously, the interest that you show in your company, both here in the room and online. I'd now like to introduce you to Mr. [indiscernible], who will open our meeting today with [Foreign Language].

[Foreign Language].

Thank you. I should introduce myself. I'm Fred Hutchings, I'm the Chair of the company. For those of you online, who need some help, it's 0-800-200-220 is a number where you'll get some assistance. And also, I should make sure and I did hear one tinkling just did. If you've got a cellphone in your pocket, either stand on it or turn it off. Thank you. If you hear a bell ringing, it's not me being saved by the bell, it is -- it will be a fire alarm. So if you -- just in an orderly manner, take instruction from staff, head out back out the way you came in, and assemble [ overby ] on the carpark in front of the kiwifruit orchard there. All right. We have an agenda. So shortly, I'll go through some introductions and do some formalities of the meeting. We'll make some introductory comments on the 2022 year and also some observations on the '23 year as well. We'll then have a much more detailed report from Michael on the various business units, health and safety and other various matters that we would normally cover in the Chief Executive's report, and then we'll have some formalities to deal with in terms of resolutions for the meeting to consider. We'll have questions. And then obviously, we do have a director retiring at the close of this meeting. So if I could now start with introducing the Board to you. Sorry, there are a couple of formalities. I jumped over those, but we should deal with them. The company's secretary has confirmed to me the notice of meeting be sent to all shareholders and all persons entitled to receive it, hence, why you're here. There is, in fact, a quorum for the meeting. I've gone through the agenda. And now back on key, and then I'd like to introduce my fellow Board members. Firstly, Cecilia Tarrant; secondly, Hayden Cartwright; Ratahi Cross; Stewart Moss; Ashley Waugh; Marty Brick; and Robert Farron. As you would always expect, there are members of the executive team here, including Michael Franks, our Chief Executive Officer, over here sitting on the corner; and Nicola Neilson, our Chief Financial Officer. Where's Nicola? She's down the back, monitoring questions for me. I'd also like to welcome Troy Florence from PwC, the company's auditor, and to our team from -- to the share register, Link Market Services, who will be helping us with conducting the voting for -- and the formal business of the meeting and will also act as our scrutineer. Finally, I'd like to welcome representatives from our banking syndicate, Westpac, ASB, BNZ and Rabobank and our lawyers, HHL and MacKenzie Elvin. Proxies have been appointed for the purposes of this meeting and in respect of approximately 7.2 million shares, representing 17% of the total number of shares. My fellow directors and I intend to vote all discretionary proxies that we have received in favor of the resolutions as set out in the notice of meeting. Now those online, you'll have a screen that looks like this in front of you. So as with all normal annual meetings, anyone in the room or online will be able to ask questions and vote, and I encourage you to do so. For those of you online, you can send through your questions at any time through the online portal by clicking the "Ask a Question" button and I encourage you to do that early as possible as it will allow us to answer those questions at the appropriate time of the meeting. You will also be able to vote online using the "Get a Voting Card" button within the virtual meeting screen. So these are formalities. I have introduced you to your Board, dealt with the proxies, dealt with the meeting process. Now let me make some high-level introductory comments before Michael gets into a greater level of detail. 2022 has been a difficult year for a lot of people in the industry. And some of this you will know, but for the purposes of this meeting, I will pick up on some of the key matters that I think. And I don't want this to sound like a list of excuses, but the reality is these are the facts. And as I say to many people who is very easy to defend the facts. But the key refit yields were well down on expectations. At times during the season, we're up to 1,100 people short through a combination of sickness and simply not enough people in the market with the positions that we needed to fill. COVID-19 has just increased costs in all respects of the business, costs that we would not normally incur in normal circumstances. COVID-19 disrupted the logistic -- logistical transport network globally. And as a consequence of that, we plan to have a machine in KKP running at the beginning of the season last year, it wasn't commissioned until the very end. In fact, I've just -- whilst I've been up to KKP several times, we're exciting to look at that machine, we went up there this morning to see it operating, and what a stunning piece of tech it is, and it certainly helped our team with a very successful operational season so far. We've also experienced lower returns from the market, largely down through fruit quality issues experienced in the market and higher costs as a consequence of fruit quality. We've also had a higher fruit loss for our growers in the Opotiki region, and we're still working with our insurers to try and get us to a position so that we can help those growth with some additional compensation for their fruit. We have had higher risks because we had grown the business up to $348 million. Our EBITDA was at $46.1 million. Our net profit before tax, $7.6 million, and the NPAT at $6.5 million. So despite having a tough season last year, we still did make a profit. Earnings per share was at $0.16. Our net assets now running over $0.5 billion. And as you can well understand, there was no dividends paid in respect of the 2022 year, even though we did pay a dividend in February '22. But those of us that still understand interim and final dividend mechanisms, that was the final dividend for the '21 year. But by the Companies Act now, it's just considered a distribution, and we made a distribution in February 2022. We had a strategy of diversifying our presence with the New Zealand and that's largely now complete. So we now have a presence and a greater present than we've had previously in Opotiki, obviously, Kerikeri and Gisborne. That gives us a total of 11 packhouses. And one of the advantages, in my view in respect to that, it gives us the flexibility when you're trying to manage huge volumes of maturity over a short period of time, gives us the flexibility to move fruit to packhouses to get that packed quickly and into cardboard and get it ready for shipping. Something that we can't ignore and which we've spent a lot of time on and give a considerable consideration to is the sustainability of the business. If there are still nonbelievers say that climate's changing, I think the last 2 seasons are a pretty good example of that. How is it changing? Global warming, I don't think that's really describes it. It's extreme weather events, whether it be hot or cold or wet or windy or frosty, but it's bringing -- certainly bringing change to how we understood climate. We've set targets of how we want to reduce our carbon footprint. We've had them verified for the last 3 years for categories 1 and 2. And obviously, we've actually published our first sustainability report in June of last year. And that's all about being responsible, being transparent and also getting ahead of the game in respect of what the regulators expect us to do, which they will -- they are in the process of finalizing listed company expectations on sustainability reporting as we speak. So these are the high-level numbers. Revenue was up 13% at $384 million (sic) [ $348 million ] from $309 million the previous year. Cost of sales, not happy about that, but a lot of it is not really within our control in some respects as I've already outlined, as to cost of COVID introduced into the system, but up 19% from $236 million to $280 million. Gross profit down 7% from $73 million to $68 million. EBITDA also down $56 million to $47 million. Net profit down, there were some one-offs in '21, largely the settlement from the Crown in respect of Psa, which was $7.6 million, down from $23.5 million to $7.6 million, and net profit after tax, 14.9% down to 6.5%. This is -- we shouldn't forget, even though it was a tough year, where we still did make a profit. So that will all moves into, if you look at it on a share basis, earnings per share was $0.16, down from $0.43. Dividends paid in the year, $0.25 relative to $0.13, and I've already explained that they gets measured at the time of distribution. Our net tangible assets stood at 5 at the end of the year, it was at the end of the year number at $5.97, and our current share price when yesterday was [ $2.88 ]. Net tangible assets $229 million, up to $251 million. And this number of shares on held -- on hand largely unchanged. It's just the maturity of staff share scheme. This is a high level, look at the net bank debt at the end of the year. We've -- and our relativity in respect of that in -- compared to the credit line that we do have. So it's up from $113 million to $151 million at the end of December '22. At that point, we held about $6.3 million of assets for sale. We were classified as current assets on our balance sheet at that time, and they've subsequently been converted into cash. But as the '22 year progressed, we proactively sought and obtained covenant amendment from our banking syndicate. With the help of Harry Hindsight, we need to -- certainly needed support on one of those and not on the other, on the EBITDA. Well, the net debt-to-EBITDA ratio, we did need support on the interest cover support, we did not. But anyway, the banks are very supportive and enabled us to -- and change those for us in conjunction with management's excellent presentations to them on the company and its performance and agreed to those changes. There's a little bit of a forward. The last line on that page is a forward thinking, and I'll come more to that in a couple of slides, but we certainly are conscious that we need to reduce our debt. And that is the ratio we would like to get between 1.5x EBIT to 2.5x EBIT. Can't have a presentation in today's environment without dealing with our environmental, social and governance matters. These are becoming the company's social license to operate, and we take these seriously. And as that slide says, we have an ambition to be a leader in this area and transparently report our environmental impact. And for that reason, that is why we've had it verified. In our first -- as the first report has been released and that documented the initiatives that we're undertaking to reduce our carbon footprint. Our first ESG report also dealt with our social activities and the support we give our communities and obviously outlines how the company is governed. But our commitment is to reduce Seeka's carbon emissions by 30% by 2025, 50% by 2030 from our baseline year in 2019, and to be net carbon 0 by 2050. So that sort of lines up with sort of the ambitions that the government and others have indicated that we should expect to target too. Now obviously, we're constantly looking at how we can do this. And there's the initiatives that we were hoping and will work towards lowering those emissions is obviously using solar. We plan to have 1,000 kilowatts up on the roofs of packhouses, principally 2 packhouses, [ Main Road ] and Kerikeri by the end of '25, and increasing that to 30,000 kilowatts by 2030. Refrigerants is a large contributor to emissions, particularly when they escape. So there's a lot of work being done to minimize that, preventive maintenance to minimize leaks to reduce the harmful impacts of refrigerants. And obviously -- and also transiting our fleet from burning diesel and petrol to hybrid or electric vehicles. The final slide I've got here is on outlook. The company is, in my view and the Board's view, is well placed for the future. We have the capacity of -- to handle the organic growth that is still incurring in the kiwifruit and coming through from our kiwifruit growers. So that means we don't need to make large investments in capacity. We've putting a largely completed automation projects at 3 facilities. The automation is not cheap. And of course, the other thing that automation requires a space. So what I should say, well, let's automate some of the machinery, you've got to have the space available to actually be able to put the automation pieces of plant around the machines. So you have to build additional space as well. In terms of labor, if we think we're well placed, there's more ROCs and international workers in the marketplace that -- so we don't feel we're going to have the same labor problems going forward. The management team, the Board has a lot of confidence in the skills and the skill set of our management team for us to be able to make -- continually make operational improvements and net them. So that's -- so if you take all those things together, we have a lot of confidence in terms of our ability to handle fruit going forward. However, we can all remember this -- this year, '22 through -- and into early '23, late spring frost, significant impact, and we released yesterday, and it's still early days. We're not through the harvest yet. But based on the extent of the harvest that has already been processed, our expectation is that our volumes could be down by 20% on last year on '22. We've had Cyclone Gabrielle, devastating effects in the Hawke's Bay, wiped out some of our growers' orchards in that region. We've had hail. So for all those reasons, we're anticipating that our volumes could be down by 20%. So outlook for '24. One of the -- in fact, I got up this morning and knowing that I'd have to dig into the back of my wardrobe and put a suit on for the first time for a while, which I only seem to wear to funerals these days. But -- and I thought, my God, I don't want to wear that suit today because I don't think it will be reflective of some of the positivity that we can see for 2024. So I did try to put a suit on with a bit more color, but as I said, most of you will think it's still drab, but it's the only one I've got left on the cupboard now because they're through the others are way because they don't fit anymore. But one of our risks is if we get a bump in volumes. And now could we get a bump? I don't know the answer to that. But the growers who I talk to tell me, well, the fruit -- the fines have had a bit of a holiday for a couple of years. They might want to come out after that holiday and perform a bit better. But I know one thing. If there's another late frost, it's going to be one hell of growth so we better prepare for next year. The water systems there, wind systems will be operating and will be able to be operated. So that gives me some confidence. I'm being told there's strong canopy growth. And there's more organic growth as well. There's more hectares coming into full production. So that, in itself, should create some volume for us. Because when the volume is there, this company makes and generates cash. And that will enable us to get our debt down to the ambition that we want to do. So there is some confidence. However, as a Board, we spent a long time yesterday discussing this issue and how should we respond. And the response that we all agreed on is that we've got to get our debt down irrespective whether we've got some confidence in the yield turning up next year because we don't know there's greater volatility. There's no doubt that there's greater volatility in terms of the growing of organic product. So that means we need to prepare and continue to reduce debt so that we can take another shock, or if the shock doesn't arrive, we're in a strong position to take advantage of the opportunities. So for that reason, we -- there's an operational focus on excellence and to improve and reduce cost out of the system. That's not easy because reducing cost is out of overhead, is easier than it is when it comes to people and expecting greater efficiency from our people and debt reduction. Now we can do debt reduction through minimizing our CapEx. And as I said at the beginning, we've got the capacity that we need, so we don't need to spend beyond our depreciation charge, or we can keep our CapEx around our depreciation charge and just spend money on maintenance and you sell some of the assets may be to undertake and continue to take asset reviews and sell those that we consider we can sell and convert the cash and reduce our debt. So how do I sum that page up? Got some confidence that '24 might be better, but we're asking management to plan for the worst and put ourselves in a much stronger position in terms of our debt load. So it looks -- I know that's a bit of a somber presentation. I hope I haven't sounded like I've been making excuses. I've been trying to give you an honest and transparent picture of what's happened and how we feel about the future at the moment in terms of -- particularly around the volumes. It is about yield. Okay. So with those introductory remarks, I will ask Michael to come to the lectern and put some more flesh on the bones around the last year's performance.

Thanks, Fred. I am in the black suit, but in somewhat more of a positive frame of mind than my Chairman. And so [Foreign Language]. My pleasure to present to you all again today and give you an insight to what's happened in your company and where the company is up to this year. And as normal for me, I would start with talking to you about people and safety. Last year we had 1 serious harm injury, which happened up at Orangewood, our new site, a person who was working on the machine to -- for repacking. So that's after the heat of the pressure of the season when we are actually reworking fruit to get into shape before we laid it out. We are using the machine. This person was pushing empty boxes under the machine transversely. His girlfriend on the other side of the machine was taking the fruit off the machine and putting it into the box. Contrary to operating procedure, he decided that he needed to have a chat to his girlfriend and wounded up to the machine, got his clothing caught in a sprocket, pulled his arm into the drive and it shredded his forearm. So a lot of retraining went on. But in the season that we had last year with all the pressure we had, we only had 1 serious incident and that was it, and the person's made a full recovery and back at work. Of course, as Fred said, last year was very difficult to get labor. At one point, 1,100 people short. We hire around 4,500 seasonal workers, so 25% missing. Of course, that doesn't happen evenly across all sites or all parts of our operation. When the COVID waves were coming through, it was hitting 1 site or another site or another site. So 75% of the people would be missing rather than 25% typically. And yet we still had to get the job done and get the crop through. Thankfully, labor availability in the current season is a lot better, a lot better. There's a lot more labor around. Of course, it's a lot more expensive. They are. They are humans, by the way. They are a lot more expensive. We have got some labor restrictions still in the regions. So in Gisborne, in Opotiki, and in Northland, typically, we're short. And so that's challenging for us. We also have the phenomenon of what we would call in the business payday fade. Today is payday and so 25% of our people will be missing as they got their money last night in their bank account and today, they're spending it. But that's just life. That's life in the modern age. We shouldn't grizzle about it. We're happier that we've got more people around and are more people available. And many of our sites, particularly here in our central operations were fully, fully personal. We've got enough people. Of course, labor costs have gone up, where I don't need to talk to you about inflation. Labor costs have gone up. And of course, a lot of our labor is RSEs. We're now up to, I think, an approved number of 1,500 RSEs in the business. Through -- 2 years ago, that was 440. So we're up to 1,500 RSEs coming into the business in a 12-month period. That cost us a lot more than kiwis. We have to pay them more. We have to pay them a higher rate than New Zealand minimum rate. We have to guarantee them 30 hours a week wages every week that they're here. So whether they're working or not, we are required only to put them into accredited audited accommodation that cannot be in Te Puke or in Te Ranga. It has to be in a rural area. We're only allowed to charge them a certain amount of money for the rent. That has to be approved by the labor inspector. We're not allowed to charge them transport from where they stay to where they work. And so with those restrictions and rules just gives you an insight to the overreach that we've got in the current regime that we have to comply with to have these people. But we'd much prefer to have them than not, and we've got them. And so you haven't got a CEO bleeding to you or some excuses about the lack of labor availability. We are building a new accommodation facility at Sharp Road because sometimes in the old days, we used to go to the countries, RSEs countries and recruit these people and bring them to New Zealand and actually have a program. Now they are recruited for us by the country that is sending them. So we don't typically have control of who's coming or when they might turn up. We've got to have better accommodation facilities. We are building 1 in Sharp Road for 140 beds. When that facility is built later this year, we will sell it and lease it back. It is noncore. It is our intention to build, sell and lease that facility back. So if you sell us, selling [indiscernible], selling it lighter, that's what we're doing. If any of you would like to buy it and lease it to us, you can talk to me after the meeting. And so outside of that, 1 serious harm injury, we're reasonably relieved really having been under so much stress. People have forgotten how bad it was, how much stress the business was under last year. Our operational staff right across the business did a fantastic job alongside our counters. They -- now it's a distant memory. People have forgotten how bad it was. People like me weren't allowed in the shed for fear that we would affect other people as we walk around. And in fact, if we're doing China supply, no external person was allowed in this area. Another point to talk you about is our risk management. Something really is for the current year 2023 rather than last year, but it's important to tell you about it. We have initiated a new mechanism to do our insurance. So we have activated what's called a captive insurance company. It's called Seeka Risk Management Limited. It is based in the Cook Islands. And for a material damage and business interruption insurance that is placed with our own company. That company then goes and has got underwriters actually providing us with that cover. So it is 100% insured by a number of underwriters, but it is through that business. So we are effectively doing the job of the broker. And 65% of the insurance company is from offshore reinsurers based in London. Insurance is going up. It is going up materially. Our insurance has gone up but has gone up by significantly less because we have pushed our insurance cover for our buildings, material damage, business interruption cover into the international market and a wave from the localized New Zealand book. Only 35% of our cover is now sourced from New Zealand reinsurers. So alongside that, we've got a normal fire risk mitigation plans that we've got going, demographic imaging across all switch boards, across all sites under load. We've got every month insurance compliance and cold store compliance being registered with their insurance company. We've got guest flood protection, which means it's a fire suppression system increasingly in our switchboards and plant rooms. We've got heat protection systems and alarms. We got 24-hour security in all sites. All packhouse sites are fenced. We've got automatic alerts to fire and emergency in New Zealand within our plant, region operational plants and automatic fire power cut off if there is an event in any of our facilities. So there is a huge amount of focus in the company around risk management, about physical risk, people risk, safety, plant safety, asset safety and physical safety to our people and to those people who join or come on to our sites. So that just told you about some things you may not have known. Insurance is still going up. Our insurance bill is over $6 million. And so for that part of the book, material damage and business interruption. Running into the operational parts of our business. I'm going to give you more disclosure and more color about what's going on in these parts of our business. This business is headed up by Barry Penellum, and that's his photo over here. If you need to feel more handsome, you can find him after the meeting somewhere. This part of our business grows kiwifruit, avocados and kiwiberry in New Zealand, pretty much what we're doing. We build orchards. We've got long-term leases. We operate orchards for people by way of management. We lease orchards, and we've got long-term leases in place. We've got $80.5 million in revenue. We had a lift in volumes overall because we've got more orchards in the books. But actually, the yields were down. And the yields were down predominantly because we had a late storm in December 2021, which impacted the U.S., particularly in our Opotiki growing region. $4.6 million in EBITDA, was down on the previous year by 13%, really reflecting lower returns from the market and higher cost onshore. And as costing growers more in New Zealand to grow, labor costs have gone up, cost of fertilizer gone up, chemical costs have gone up. Our compliance costs have gone up. And so it's important. A number of analysts have asked me and talked me about the level of assets that you've got in this part of our business. Actually, in our analyst briefing pack, that number was $80 million, I think. That's gross assets. Our net assets in our Orchard business is $40.2 million, and that $40.2 million net asset figure, about $20 million or just under is our investment in long-term leases, and I will explain that to you in a minute. We've got $14.4 million, which is a work in progress, effectively growing next year's crop on those leases, which we recover from the revenues that those orchards produce, and we've got about $5.8 million in Orchard Machinery. Tractors, vehicles, trucks, equipment division really is what that's all about. Around 17 million trays in total was grown by this business in 2022, and you can see the numbers going up the slide. This presentation will be online shortly after this meeting. To give you a bit more color about the long-term leases, why do it? Well, there's a number of reasons why we've done this. Firstly, and predominantly, what it does is it secures fruit supply to our post-harvest engine room, which is where we generate cash. It's where we've got the bulk of our assets invested. So it makes sure that in that hotel for fruit that we're going to get some fruit to occupy that hotel space. That's predominantly what we're doing. It also happens to make money. And so -- and a little bit of an ambitious, perhaps, way to do things, perhaps a little bit scary to do it, but we're actually disclosing to you what our estimates look like going forward for this part of our business. Of course, some leases mature. Some leases are coming on over that time. But we expect to have, by 2027, 53 hectares of fruit, orchards and production for SunGold. We expect to have 51 -- sorry, 40 hectares in production of Hayward and 11 still in development or are mature. And we expect this part of our business in 2027 to be delivering $3 million in EBITDA or $13 million over the 5 years. Most of those orchards are nearly all coming into, you can see in 2024, they start getting into production full time. A lot of those orchards are partnered with iwi, with the Kanoa fund, which is the provincial growth fund, and landowners, and we had some on the [indiscernible] up the coast and has this added benefit of economic development that's going on through that investment and you're welcome. If you want to go and take a look at those orchards, you're welcome. We can actually have you hosted to take a look. Those developments must pack for Seeka until 2050, at least. Those orchards must pack for Seeka until 2050 at least. And so -- and our investment that we've made in those orchards is repaid just alongside the Crown's and iwis investment, the money is repaid over time, and we also generate profits that we get out of those orchards. So I think what we're trying to do here is give you some insight that we have invested a little bit further than 1 year, and we are more than just running a hotel for fruit. So we have 170 hectares of long-term leases operating in 2023, 116 heaters of kiwifruit, 41 hectares of Gem and Hass avocados, 11 hectares of mature lemons, and 2 hectares of kiwiberry in development. And so -- and look, I would give you every disclaimer about those numbers. It's based on assumptions. They're out beyond 1 year. It's our best estimate today of what we think those developments will do. It's giving you an insight as to why we've got $40 million invested in our orcharding business, half of it is in the future. So perhaps that might put some color into that part of our business. Likewise, this is our post-harvest operations business. This is the big engine room of our company. $215 million assets, $365 million of gross assets in this part of our business. Nice photo of Paul Crone, looks like it's been photoshopped, but all good, Paul's here somewhere. I think we might be hiding after that comment. This business, in case you don't know, organizes the harvest of the fruit, the packing of it, which we're currently underway at the moment. It's cool storage, and it's dispatching out to the market. Predominantly, most of the fruit here will be sent to Zespri. So we'll give it a one-way trip for the [indiscernible] to put it on one of their boats, but we're also increasingly exporting avocados around the world, kiwiberries, in our own case, to Australia and packing for third parties. So we're doing a lot of contract packing to avocados, a lot of contract packing for citrus, a lot of contract packing for persimmon. Those businesses are pretty exciting really. And we -- it's sort of an increasing part of business for us. In 2022, $233.8 million in revenue, up 19%, a $59 million EBITDA was down 4%, which reflects the cost to do business in a COVID-type environment. We had some fruit damage. This is a toll processing business. We make money by handling fruit. If we don't handle fruit, we don't make a dollar, we don't make anything. We just have the fixed costs. And so if we lose fruit volumes through disaster or climate or storm or frost, then it impacts this business because you've got -- haven't got fruit to toll process. We've got the capacity in this part of our business. I can see [ progressing ]. We've got the capacity in this part of our business to handle somewhere between 50 million and 55 million trays in a normal season. So the investment is largely there and largely made. And so -- and I would say to you that the $215 million of net assets, all of the [ SFBs ] we've got on our books are at fair value. They have been audited. They've been through a valuation process at the end of last December. Rounding up the book. In terms of our operational part of our business, we have the SeekaFresh retail service operations headed up by Kate Bryant, our key person and our lead team. Wonderfully experience having spent 18 years at Zespri before she joined us about 8 years ago. This part of our business in SeekaFresh is really where we connect the market with fruit that doesn't go to Zespri. So Class 2 fruit to Australia, kiwifruit, local market, fruit, avocados, kiwifruit, exporting kiwiberries and exporting avocados, which we've got programs going around the place. Kiwiberries is a small category in our business, but exceptionally positive, exceptionally positive. It is very profitable to those growers who have persevered with it, and it's been profitable that way for 4 or 5 years now. It's exciting, and they get all of their cash flow from their much harvested fruit by the end of September. So it's a quick turnaround tuning group to cash. This part of our business also imports bananas, pineapple, papaya, and it imports fruit from Australia for some short supply in New Zealand. We've got a growing business with category managers at [ Costco ]. We've got great relationships with both of the major supermarket chains in New Zealand. Business, of course, in the 2022 year was impacted by lockdowns in Auckland and prolonged lockdowns. And so this business was impacted in terms of fruit flow and demand about how much we make money here by selling fruit. And if the markets aren't operating, we got nothing to sell. And so that's the key thing. Business has performed pretty positively since 2022 and is off to a roar so far in 2023. So I did write the significantly improved 2023 and more normalized operations and a pretty good focus going on there. So I'm happy and more satisfied with that number than what we were. Of course, we go out to Australia, and I'm going to give you some more color about Australia in a minute. So this is led by a wonderful Australian General Manager called Jon van Popering. I hope he's on the line, no jokes about him. They grow pack and retail kiwifruit and nashis and European pears in Australia, alongside plums and a new category called Jujube dates. It's a fresh date, not a palm date in case you need to know what that is. Very, very positive development. $1 million in EBITDA. They've been through the same issues that we've been through in New Zealand with lockdowns, cost increases, weather events have had the lot. They're resilient, those guys. And alongside our mature orchards, we've also got 63 hectares of kiwifruit in development, alongside new variety peers, which is a new variety, nashi varieties, which they're red, and our dates, which are jujubes. We had just under $20 million in net assets in Australia. Reminding you that we, a few years ago, sold our mature kiwifruit orchards and leased them back. And so -- and booking a gain on that transaction when we did it. The $19.8 million in net assets is made up of $16.6 million of land and buildings, which is at fair value that were valued in December. We've got $11.6 million in the 63 hectares under development of kiwifruit predominantly. We own some water issues over there, $5.4 million worth, and we have some just normal plant and equipment, packing equipment over the $4.9 million. Likewise, putting some more flesh on the bone about your company about what we're doing in Australia with Jon, $11.6 million invested in orchards and development, predominantly it's in kiwifruit, we have 93 hectares in production now. In 2026, we expect that to be 155 hectares in full production. Our nashis will increase from 46 hectares to 73 with an increase with the red nashis. We'll be the only ones that have got those in Australia. And we're expecting our EBITDA forecast, subject to all the disclaimers which were noted before in the previous forward forecast for the long-term leases. We are expecting significant improvement in our financial performance in that part of the market. So that gives you some color about the investments that we've got in Australia and while we're doing it. The jujubes, I think I'll make just one more comment about. We've probably got a tiger by the tower. They grow in that part of the world with little water, about 1/10 of the water demand that a kiwifruit orchard would require for 1 hectare. They grow with little or no chemical intervention. There's no spray program. There's no fertilizers. They require little pruning. They yield within 12 months after planting. About 15% to 20% of a normal year's production and 3 years we're at full production. They should do [ 20 tonne a hectare ]. Current market price sort of fluctuates between $10 and $24 a kilo. And so of course, how much the market can take as a fresh product, the beauty of jujube is that you can also process them and sell them dry and make 12-month product as well with kiwi Asian demand. So that is a category that we are chasing a little bit. We are developing those orchards, and we have sale and lease bet proposals already in place for them. So we won't have our cash to meet up too long in that part of the world. So what I've done to that date -- to that point of my presentation, just explain to you a little bit what's happened in the company. The operational breakdown, challenges we've been through, put some color about the investments we've made in the future of both the long-term leases and with Australia. So I've had some questions over the last 6 months since our analyst briefing call. So the forward focus for us, well, -- right now, we're mid-harvest. We're about 60% of the way through the gold, and we're about 25% to 30% of the way through the green depending on the stats. It's been a little bit hard to pick exactly what the yields are doing because we've had some orchards that have been stressed, water stressed. We've had some orchards that have been carrying unusually low yields and so therefore, maturing unevenly. We've got some orchards that have been hailed or frosted. And so when we start looking at the trends at our pack versus estimate, you have to put some -- a warmed over at thinking, oh, well, is it just because it's the low orchards? Is it just because it's a stress orchards? Is it because it's the Guzman orchards or not? And so it's been hard for us and still was a little bit volatile in terms us to work out exactly what total volumes will be, other than to know that they're down. Of course, we knew or we expected the yields at altitude -- mid-range attitude orchards to be higher than what we've experienced and those stressed orchards that we handled first. And of course, then as life would give you these sort of events, we had a hail event. So right through that band, we didn't want it. So we're working through those orchards at the moment through and work it out. So we've focused the business on core business. We're focused on operational improvement and being excellent. Team actually has put together a pretty complete season so far. They've done a great job actually. It's a much more smoother half this year than last. It's not perfect, but on the scale that we do things, perfection is something we strive to achieve. We haven't had any safety incidents of any note. We've had a couple of near misses. We've had a couple of random events. We had some person who decided it was sensible to hop into the car of a person at Opotiki at night down at the lab when she was leaving the building. He demanded that she take him to the police station. I must probably should suggest you get it here on his own. But those -- we've had a couple of those events. We've had no injuries of any note. Our capacity is set in the business for 50 million trays. We don't need to put capacity improvement in place. So we don't need to have capital capacity in the company for the next 12 months at least. And we are, at the beginning of this year, reduced our capital expenditure down to within depreciation. We much slightly talk above that, but that's -- we we've actually put it at the moment. We are anticipating profitability improvement in 2024. We can see that the canopies and the orchards look pretty good, to be honest. The lower fruit yields actually have resulted in the natural reaction in the plant to have more digits of growth. Our orchard, our growers right across the region are far more frost aware and unlikely to be caught out by a frost event again, but we still are subject to the vagrancies of the weather, I think. Last year was a very warm and mild winter. To remind you, it didn't snow [indiscernible]. And so that meant for us when we had our bud break, the plants didn't have the -- a lot of required amount of winter chill. Haywood, in particular, requires winter chill to go into some essence, to go to sleep if it's going to pop out with his normal figure. We didn't have that. Our bud break was very indifferent. And so with the likelihood that we're heading back to El Nino, we'll be hitting back to colder winters. And that's a prediction. And so therefore, there are some positive signs on the horizon in spite of my Chairman getting out of bed, worrying about life in 2024. If the numbers come back in 2024, so will the profitability. We are focused on cost reduction. We have been bringing down the lid. We have been not replacing people as they leave. We have been juggling and moving the deck tiers around. We have been restructuring parts of our business in a sensible way because the last thing that we can do as a company as we go and go in too hard and actually make unnecessary changes, and then the volume comes back in 2024, we'll have a disaster. So we're just sensible about what we're doing to make sure that we're prudent. Company has set a targeted debt-to-EBITDA ratio range of between 1.5 to 2.5x. We debated that with the Board yesterday. It's management's intention to get it down to the bottom end of that range as soon as possible, through organic manners -- organic means. We are looking at targeting increased profits and lowering our CapEx. We don't need to spend beyond depreciation because we've got the capacity in plant at the moment. And we are continuing to review noncore assets. We did sell some excess water in Australia, which settled this year. We've got a few orchard holdings that we are selling or we have sold. We're just working through those at the moment. And as I outlined in the analyst briefing session earlier in the year, we have been thinking about looking at and contemplating whether it'd be sensible for us to sell on lease back any of our assets and recycle that capital either return to debt or return partially to debt and still have some money to have some financial freedom of action. That's what other opportunities being considered means. And so that being the case, the photo that you can see on that slide is actually of the new KKP machine. We did have to struggle last year without it. This year it has turned on like clockwork. Jared Bates and the team down there have done a fantastic job. It is handling 900 to 1,000 bins in a 24-hour period now. It has been predominantly packing gold. People who have gone there are very happy with it. It's earning, its return on capital. And we're delighted with this performance really. So that's my presentation to you, our shareholders. I'll be happy to read the Chairman to answer any questions that come my way later on in the presentation. Thank you.

Thank you, Michael. We're feeling much brighter now. So I am pleased. I put my blue suit on. Right. We need to conduct the formal part of the meeting now, which involves 3 resolutions, and they've all been outlined in the notice of meeting. And there will be an opportunity for shareholders to ask questions as each matter is put to the shareholders. So for the sake of good order, shareholders questions should be -- relayed directly to the matter being considered. So now moving to the resolutions, and a poll will be held for each of those resolutions. Shareholders joining us here today, you've been given your voting card. If you're a shareholder and did not register on arrival and wish to vote, please make your way to the registration desk back outside the door there if you haven't got it, and the Link people will assist you. Please mark your card of your voting intention for each resolution, and the voting cards will be collected at the conclusion of the meeting. Shareholders joining online are able to cast their vote using the electronic voting card received when you registered online and were validated. For those online, you just need to click on get the voting card. And of course, as you will all be aware, you can vote for or against or abstain. And voting will stay open until 5 minutes after the conclusion of the meeting, and Link Market Services will collate and act as the scrutineers. And the results of the vote will be announced by the NXX -- NZX, sorry, as soon as we -- as soon as they're made available. Each resolution, as set out on the notice of the meeting, will be considered as an ordinary resolution, which means that it will be approved by a simple majority of the votes cast by the shareholders entitled to vote and voting on the resolution. And I think we're going to put back on the screen. The outcome of the proxy votes were displayed for your information. So let's move to Resolution 1. I now invite Cecilia Tarrant to address the meeting.

[Foreign Language] Thank you, Fred. I'm pleased to have the opportunity to speak to you today. This is the second time that I have stood for reelection. When I first joined the Board in 2017, I had no background in the kiwifruit industry. And after 6 years, I know a lot more than I did then, but I'm still learning and enjoying being part of this complex industry. As an independent director, not daily immersed in the industry, I believe I am able to make a valuable contribution, bringing a different perspective to the Board table. Being a director is my profession, and I serve on a number of other boards, which provides me with a range of perspectives that enhance my contribution around the Board table at Seeka. In particular, being the Chair of New Zealand Green Investment Finance provides me with insights into the opportunities to finance climate change mitigation and into dealing with both the bureaucracy and politicians in Wellington. As Chancellor of Auckland University, which means I Chair the council or the Board of the university, I have provided perspectives on a range of issues faced by a large complex business. When I was reelected in 2020, I told you that sustainability would be a key focus for me in the next 3 years. This continues to be an important focus for me. I'm proud of the work that the company has done in the area of environmental sustainability, calculating its carbon footprint, setting goals to reduce emissions and formulating plans to meet those goals. We are still early on this journey. Business resilience is an equally important part of sustainability. Seeka operates in an industry where volatility is becoming increasingly the norm, whether due to weather conditions in New Zealand or overseas, selling conditions overseas, supply chain challenges or availability of labor to name just a few. My goal as part of the Board is to make sure that Seeka is in a position to deal with volatility and thrive. I would like to take this opportunity to thank my fellow Directors and management for their support. Thank you for listening to me, and I hope you will vote for me. [Foreign Language]

Cecilia chairs our Sustainability Committee. And in fact, we're one of the few public listed companies that actually has our Sustainability Committee of the Board. I now propose the following resolution to reelect Cecilia Tarrant as a director. Are there any questions on this resolution? [Voting]

I haven't seen any questions from shareholders and attendants and is none from online. Thank you, Nicola. So thank you. Now move to Resolution 2. I now invite Hayden Cartwright to address the meeting.

Thank you, Fred. [Foreign Language] I'm Hayden Cartwright, kiwifruit grower from here in the Bay of Plenty. I'll return to manage my families, kiwifruit orchard in 2020, following 20 years following my engineering instincts. 17 years in the oil and gas industry and the construction and operation of margin-driven LNG terminals and oil refineries has given me transferable skills and knowledge very useful to the world of horticulture and to post harvest. Combining this with the natural desire to get the most out of the land with innovative thinking is enabling me to love what I'm doing. In my profession, I spent countless hours pouring over reports, budgets, plans and testing them for cracks and looking for opportunities. I will use these skills and others that I've picked up along the way to complement the vast array of experience around the table so that we can guide this company back to the dividends that is used to delivering. The industry is obviously facing headwinds, but I believe in this company to weather the storm and to deliver for its shareholders and its growers into the future. I'm a storage supporter of the kiwifruit [indiscernible], which is why at times I'm one of the Zespri's biggest products. If we don't ask questions and challenge, then we risk losing the benefits of this monopsony that has delivered since hearing of its construction around the dining table as a young fellow. Seeka has delivered much to this industry, to its community and to my family over the years. I'm proud to stand here and say it's my time to offer my support and return. I trust that you, the shareholders, will give me this opportunity by voting for me today. Thank you.

Thank you, Hayden. And one of the other advantages is that I didn't know probably have the average age of the Board. But -- so I now propose the following resolution to elect Hayden Cartwright as a director. Are there any questions on this resolution? [Voting]

None from the room. Heads shaking at the back. So there are no questions. I'll now move to Resolution 3, the appointment and remuneration of our auditors. I now propose the following resolution to record the reappointment of PwC, PricewaterhouseCoopers, as auditor of the company and to authorize the Directors to fix the remuneration and expenses of the auditor for the coming year. Are there any questions on this resolution? None from the floor and none from online. Thank you. There is one.

[indiscernible] of the auditors. How do you do it? I'm curious as to know how do you fix the remuneration of the auditors. It's on every resolution of every company I've ever seen, and nobody has ever given me an indication of how they do it.

Whenever you buy any service from any service provider, they have to provide a budget, put a proposal for you, explain what -- where the time, if they're okay, will go into the order process. Then the management team will review that and come to a conclusion whether I think it's a reasonable fee for the work that they believe they need to do to undertake their role. Hope that helps you understood.

I don't believe you.

You don't believe me? Well, that is the process that goes through to help the Directors authorize the remuneration. And it's an interesting factor, isn't it, it is the only service that's provided that the Directors authorize. And it's done because the auditors are there for you as the shareholders. Sorry, I just saw another arm go up then.

Just following on from that. Are there other alternatives to PricewaterhouseCoopers have considered?

That's a good question. Well, there's 2 things. There's one about over familiarity of the auditors with the process, and that is managed through audit partner rotation, which happens every 5 years. So the audit partner is -- and he does the audit for 5 years, not for 50 like they used to in the United States from time to time. But then obviously, we, as a company, will go through a process and make sure that we're happy with the service and the quality of the service that we're receiving from the auditors. And if we're not happy, we will consider whether we may ask what tenders put out an RFI, request for information on other firms that may be able to do audit for us. So we haven't felt that we've needed to do that up at this stage, but it's certainly something that's available to us should we wish. In fact, we can't just throw the auditors out. They are automatically reported -- reappointed under the company's act. As you'll see, we're not appointing the auditors here. What we're doing is asking Seeka, your authority to pay them. And in fact, the auditors -- but if we go through -- want to go through that process is an understanding in the profession -- in the audit profession that they would effectively retire, resign and leave a vacancy, which the Directors then have the authority to fill. So that's how the process would work. Should you want to change it -- should the directors feel we need to change our auditors on behalf of the shareholders. All right. I'm up to questions in general business. So I'm happily open the floor to any questions if there are questions from the floor and from online. So if you could just wait for a microphone so that all the people online are able to hear your question.

Similar type of question has been asked about the auditors. Firstly, Michael has said that the engine room of Seeka is the post-harvesting processing of the kiwifruit, most of which comes from independent growers. Now my question is, how does Seeka go about working out the cost to the growers, which is related, of course, to the income of Seeka. And also does this cost have any relationship at all to what the price of kiwifruit is fetching overseas?

Right. That sounds like an answer for the CEO, Michael, because I'm conscious that they've recently been through their pricing for cost of processing kiwifruit?

So it's not straightforward. We look at the crops that we think we're going to handle the coming year when we look at capacities. We go into the business and we do a cost build to look at what pack types do we think we're going to pack, what labor is it going to take us to do that job, what is the incremental cost or revenue that we'll get from Zespri because they pay us away from when we pack away from a bulk. And then we work out what margin we need to make or want to target making that should be profitable in that part of our business. And then we overlay that with what we think the market is doing in terms of the local post-harvest market and what all the other operators are doing. And we're trying to get a read from our market intelligence about what's happening, what losses we've had, what gains we've got, what the market pricing is doing for kiwifruit. And then we largely will set the price. There's no resemblance at all to what growers might be getting in sales in the market, but it will be a resemblance to the investments that we've made in order to be able to put that capacity on. So if you think about it or you don't need to, but a lot of the investment and capacity we've put in place is for gold. Gold comes on in a peak moment. We're in the now [ 16, 17, and 18 ] will be peak weeks for us, will be full noise. At that time, we're full. If we get more gold, if we decide we will need more capacity, it's going to take more investment. That investment is expensive. It's got to pay back from that category. Hayward largely comes in afterwards. So we're using the capacity that we've had previously. It's -- we're getting turnover through the stores. In that way, we actually aren't making new investments for Hayward. And so the margins for Hayward have been slightly less. So we're looking at margins, cost build and pricing in the market predominantly to work out what we've got. Around 40% of the fruit that we handle as a company we grow. We may not own it. That may be owned by [indiscernible] through a management relationship rather than a lease. But around 40% of the fruit that we handle, we -- our orchard managers have stewarded through to halves. So just to correct that first comment, we are the...

Thanks, Michael. I hope that help you understand that. And we shouldn't forget it as a competitor, the post house -- post-harvest is the competitive part of the industry, isn't it? Any other questions? There's one coming down here. Wait, I'll come to you.

Yes. So I have a question. I look at the table in front of us here, and I see an old-fashioned board. I just wonder about the -- I see the gender, the diverse -- sorry, I'm not offending anybody. But I just...

[indiscernible].

Yes. So I just wondered what you identified gender composition of the Board is and do you intend to remain predominantly male on the Board?

Well, the answer...

I will add that I would suggest that other Boards in New Zealand are not focusing on that type of Board. They're wanting more gender diversity.

We tried very hard to change the gender diversity the last time I went for a director search. And unfortunately, we didn't find any women that really wanted to join the Board. We interviewed a number, and they didn't really have the skill set that we were looking for at that time. So it's not -- I have to say it's not without trying. And I still have the view it's the right person for the job with the right skill sets. But if we can find those skill sets with -- that gives us the greater gender diversity that we've got at the moment, we'll be very pleased. That's not -- we haven't ignored that issue. Ratahi, did you hear this.

I just want to take this moment to talk about the Seeka grower family, which is really important in respect to Cyclone Gabriel. We're the largest kiwifruit grower in the Hawke's Bay, and we lost a considerable amount of our orchard down there. It was also a time when I nearly lost my life. Now I want to talk to you about that. I was at the gate locking the gate, and it was dry. Within 1 second, it was up to my chest in water. I turned around, and my truck was just ticking over. And I got in my truck, and I was driving down the highway. Now you've seen this on movies where you're driving down the highway. And behind you, there's a wall of water that's twice the height of your truck and is chasing you down the highway. So I get down to the end of the highway, trying to take out where I could escape, and then I'll watch the water come over the top of the bridge at Omahu, and it cut off my escape. So I shut off towards Hastings Golf Club to try and get out there, and I watched the road float because the river had got onto the road. And so there was no escape. So that's how frightening it is to watch hundreds of people running along the road looking for somewhere to go. So that kind of experience is probably a once in a lifetime experience. What it brings me to is the Seeka family. Within hours of that happening, I was receiving hundreds of calls from the Seeka family of growers, saying what can we do to help you? And that's one of the amazing things that we should recognize as a group of owners and as a group of growers here that we do care about our family. And so I want to say thank you to the growers here who actually made those calls to us and other growers in Hastings. We are suffering. It's still very difficult down there. But it's really, really -- it really makes you feel good to know that people care up here, and that's important. That's been so good that it makes you really understand and value why you're a member of this company. It's those extra values that are important to us, especially us who are growers. And so for those who aren't growers, thank you for considering us as a family as well. And I just needed to say that because I won't get another chance to thank you. Thank you.

I was in the Hawke's Bay over Easter and saw some of the distraction that comes from the power of water and logs. And it was quite humbling really and scary. At that time, I thought it would be very scary to be anywhere near there. Is there any other questions? Yes, go for it.

Talking about capacity to process, you had a crop this year or the handling volume, which was 42 million trays, which is 20% down. You've got it -- you told us you've got a capacity to do 50 million plus. So really, you just on the limit, they're really agreed to handle a normal year. What are you going to do if you do have a bump because, yes, you are in for, now you know, things got to kind of be different.

The -- we've got the opportunity of a number of pack houses, which obviously we can ship fruit, but the volumes are at that level. That means that we have less opportunity to take on fruit from people wanting to pack from us from our pack houses, so we need to manage that process. Michael, is there anything further you'd like to add?

[indiscernible] down the line.

You do. Down the line, you do.

So the 20% reduction that we talked about yesterday is on 42 million, not 242 million. So just to make everyone understanding. So if there's a bump, it's going from something below 42 million up to something. And so the bump would take us to 50 million, not beyond 50 million, I think that's sensible. .

[indiscernible].

Correct.

That's right. Yes.

Yes. And so no point in just leading that one slide by. I got to be open and honest. And we've got the capacity in the business to do 50 million plus, and that would be the bump up. Our plans sort of see us being able to do that. In a normal yielding year, we should go somewhere in mid-40s and/or plus, and that would put us sort of still with some buffer. .

Thank you. Nicky, if you got some from online.

Yes, we do. So first question is from Peter. He'd like to know if the company is looking to raise any additional share capital over the next 12 months.

We actually discussed that as a Board yesterday, and that was something the Board discounted because we didn't think, given our share price, it was a good time to try and raise additional share capital. So that's the short answer to that question.

And a second question from [ Carly Venkemp ], she'd like a bit more color around the illegal gold kiwifruit planting in China, and in particular, if any of the Zespri red variety has been found in China.

I don't know any -- I haven't heard anything about the last part of that question. Michael, can you -- I think you might even be struggling to put color on that question and tell me what's happening in China.

Yes. No, I can put color on that. There's about 10,000 hectares as we understand it of gold in legal planting. It's not illegal because it's not illegal. There's 10,000 hectares of G3 plants at China that they are growing and cropping. They are slightly counter cycle to us. We will have a smaller window, an earlier window for fruit sales in the year. And of course, fruit that carries from New Zealand and has exported anywhere in the world has that ring of quality that you've got with the Zespri brand and the strict growing process that we go through in food safety. In the case of red, there's been no reports of Zespri ruby red growing anywhere else in the world. But of course, I would remind you and people in the room would know that our red variety is growing in China that are not ruby red. It's not the Zespri variety, but there are red varieties growing in China already. And so -- but not that particular variety.

No further questions. Thank you.

No further questions. I ask the floor once more if there are any other questions. You've got -- yes.

Sorry to keep by me. The floods Aussie, were you affected?

A short answer to that is yes. But Michael, you could put some color on that, too. You were over there recently.

So yes, the floods that we had in the Shepparton Goulburn Valley region did affect our waters, and we did have some areas underwater. We've lost about 2 hectares of Hayward out of 100 hectares and 63 hectares in development. So not a material area. The plants didn't like it, but we've only lost 2 hectares. In the case of pear orchards, our Nashi pear and European pear orchards, there was water on those orchards, but has caused no damage.

Right. There's no other general business questions. There's one final matter I need to do. And I need to offer Marty an apology because we had quite an intense Board meeting yesterday at -- due to my lack of ability to control things that ran on longer than it should have, and I completely forgot to thank Marty at the Board meeting for his considerable contribution to Seeka both as a Director, a [indiscernible] and as a shareholder. So now I get the opportunity to do it now. But Marty, on behalf of Seeka, many, many thanks for your considerable contribution to the company, your wisdom and thoughts on and how the kiwifruit industry and help keep us online on many occasions. So thank you, Marty, on behalf of the company. But at a personal level, I also would like to very much thank Marty for his patience in repeatingly helping me get a better understanding of the kiwifruit industry and how it handles kiwifruit. So I personally have learned a lot from you, Marty. Thank you for your expertise and your friendship. And I wonder if we could just all thank Marty in the normal way. Now I understand Marty wanted to have the last say, but -- so Marty.

Thank you, Fred. I had to say something is not much precedent for ex-Directors stepping up here, but I'm still in the industry and still will be a big part of it. Actually, I'll just wrote a few notes here. The -- first, I'd like to thank all the shareholders and growers for supporting me for the last 8 years. It's been a pleasure working on behalf of both growers and shareholders. It's not easy, and often there is conflict in those decision-makings, but I try to take a middle ground. And I guess I lean towards growers in a way, but also try and support shareholders. Also, I'd like to thank the Board that I've worked with for over that time all the way, and it's been fantastic, a great experience. And there's this good school [ base ] there. And it's great to see the average age coming down a little bit. I was getting a bit nervous with myself there. So I'm sure Hayden will contribute well. And then the other thing I had people ask me why I'm stepping down, for what reason. I had to think about it. But what didn't take too long, when I first saw in the industry, I bought the second electronic grader that was made by a chap, Hamish Kennedy, who used to stay at home when he was down here. And anyway, when you first said, Marty, ring Matthew, do you want to have this electronic grader? And I don't even know what the electronic grader was. Yes, sounds good. So it brings it down, sets all up and way we go. And I think that output about 800,000 peaked by the time it finished. And then I look back, and when I started, the revenue for the industry was $2.9 million, which I find difficult to think, it was $2.9 million back in the '70s -- mid-'70s. So once I started looking back -- look back those at cowboy days really, and some of them here will know those days, and they were a good times. And the industry has developed a long way from then. It's got a much stronger governance. We see the KKP grader is quite extraordinary, looking at that from what I had in the late '70s is a huge change and to the benefit of the industry watching that it was something else. So thank you, everyone. And yes, I've enjoyed my time. And lastly, yesterday's meeting, and Michael's sense of humor, I sort of got used to, but he said to me, you realize what the crop is and I said, it crops down, crops down and sort of it was, he -- you realize how far it's there. And he's just done this, this and this. And I said, come on, it's no April Fool's Day. But in reality, we've come off 2 years of slippage in volume, and that's not easy at all. I mean that's a very difficult thing to handle. We have total confidence in both management who do a fantastic job and the Board to control that situation over the next 24 months. And it will require a lot of detailed work, I imagine, by both parties, particularly the management structure of Seeka. So yes, I'm looking forward to -- it's got a few holidays. So I'm looking forward to doing that. I'll have a sum that's taken over the growing side of the business a bit. So looking forward to doing a few other things. Thank you very much for your time.

Thanks, Marty, and thanks again for your outstanding contribution to the company. Well, I hope you've -- before I close the meeting and got a sense -- this is a business you have to have patience because you're growing a product and it's subject to significant volatility. And there's no doubt that the weather volatility is an increasing risk, but there are steps everybody can take to mitigate that to the extent that they can. And I'm sure our growers are all doing that. They're all improving their practices. They're improving their mitigations, whether it be for frost, wind on their orchards. So that gives us the confidence that hopefully, those volumes will come back and give us the volumes that we need for this company to generate the returns that it should be generating on the assets that it employees that we can then to reward our shareholders. Now I think we've got refreshments down the bottom. Michael, that's right. So do please join us down the bottom in the kitchen area and take the opportunity to just talk to the Directors and management should you wish to. So finally, thanks, everybody, for your attendance. My thanks to management and their expertise. And also thank you to the Board for all the support that you give me as Chair throughout the year. Thank you very much, and thanks for coming. So just before you go, we will close the meeting with a [ Kerikeri ] .

[Foreign Language]

I think some of you have still got your voting papers in your hand, haven't you? Please hand them to Link Market Services as you leave the room.