The Foschini Group Limited (TFG) Earnings Call Transcript & Summary

Good morning, everyone. Welcome to the TFG FY '25 First Half Results Presentation. Today, we'll be covering an overview of what we've achieved both financially and strategically over the past 6 months, a detailed review of our financial performance presented by our Chief Financial Officer, Ralph Buddle; segmental performance reviews of our various core businesses. We'll then close with an update on our strategic opportunities and priorities and outlook for the balance of the year. After this, we'll take a 5-minute comfort break followed by a Q&A session. We've spent much of the past 18 months successfully landing and consolidating a number of significant investments in our TFG Africa business and preparing all of our businesses for what we believe should be a more positive retail environment going forward as the interest rate and cost of living cycles turn. TFG has long been, is and will continue to be, a growth company. And as a result of these investments into building out our retail platform, we've ensured that we are very well positioned to continue to gain market share in our current retail verticals as well as a greater share of our customers' wallet and total spend as we continue to move into adjacent categories. While our growth focus clearly continues, now that most of our previous investments have been bedded down and are starting to bear fruit, we are more cognizant than ever of the imperative to enhance profitability ratios and shareholder returns through very clear forward planning and forecasting processes, together with an even stricter lens on capital allocation, given the number of different growth vectors and opportunities that we have identified. Macro cycles aside, we expect to see the culmination of all of this in an enhanced share price going forward on the back of a nearly 40% year-to-date share price rise for TFG. Looking back over the first half, it has been tougher for longer than most would have expected or wanted across all of our geographies. The Fed, which was expected to start cutting rates in the first half of the calendar year, only made its first cut since March 2020 on September 18. Other governments have started to follow suit. However, none of this would have positively impacted our first half. To summarize the economic and retail environment that we've traded in, as is clearly demonstrated in these charts: inflation has been at elevated levels since the end of COVID; GDP growth rates have trended around 0; consumer confidence has remained in negative territory; and I guess not surprisingly, household consumption has been flat to negative with a very small recent uptick, if you look at the last chart very closely in South Africa. As a result of the artificially higher prior year H1 sales base in South Africa, together with the generally tougher for longer operating environment, group revenue contracted by 1.4% to ZAR 28 billion. Given this backdrop, our current year focus was very much about the recovery of our gross margins for TFG Africa, the maintenance of our already high gross margins for TFG London and Australia, and very tight cost control across all 3 territories. This focus on local gross margin recovery, together with the investments made in localized Quick Response manufacturing and the enhanced efficiencies that we've already started to see flowing from our new Riverfields DC in Johannesburg, together with the great gross margin outcomes in the U.K. and Australia, enabled us to significantly improve our group gross margins from 47.3% to 49.5% which translated into a 2.5% increase in brand's gross profit to a record of ZAR 12.8 billion, despite the negative sales growth. Thanks to operating costs being very tightly held, operating profit contraction was limited to only 3.4% and HEPS to 5.6%, which was a lot better outcome than we would normally have expected. On the back of the confidence that we've developed around the positive gross margin evolution and the improved trade, post the H1 reporting period, we've been comfortable in raising the interim dividend by 6.7% to ZAR 1.60 per share. As much as we focused on profitable trade during a tough half, we also continued to improve pretty much all of our key balance sheet metrics, including our net debt-to-EBITDA, stock turns and health, the quality of our book as well as our return on capital employed. Well, Ralph will provide a lot more color to these in his presentation. Looking at our 3 primary geographies, it was pleasing to see TFG London and TFG Australia, both further improving their already very healthy gross margins, which helped to shield their profits from the worst of the impact of their lower revenues. That said, the real star of the show for our first half was TFG Africa, where our retail teams increased gross margins from 39.5% to 42.2%, converting a modest 0.6% revenue increase into a very positive 6.6% growth in gross profit. This, together with disciplined expense control under Ralph's watchful eye, saw TFG Africa's profit before tax increase by a very credible 8.5%. At our year-end results presentation, we included, for the first time, a lot more granular detail about each of our TFG Africa operating retail stacks. We received very positive feedback about this additional disclosure and have now taken this level of detail even further. I would encourage everyone to go through the detail on the slide when they have a moment. But in summary, almost all of our brands and stacks within TFG Africa grew their gross profit well ahead of their turnover for the period. And equally, almost all of the brands and stacks improved their stock turns during the period, despite being up against the artificially high sales base in the prior period. The combination of these 2 positive trends points to very disciplined and agile trading and stock management across the entire business. I would like to call out and recognize the stellar performances in both our value and specialty stacks. Our value stack turnover after having closed nearly 40 Jet stores during the lease renewal period contracted by 4%. However, their gross profits grew by 5.6%, which was a great result and underpinned an 85% improvement in their H1 profit. Our specialty stack comprising our various home and jewelry businesses grew by a very credible 5.1% and grew their GP by 9.1%, which was very much against what you'd expect for these high-value categories at this point in the cycle. Digging deeper into the individual components of the specialty stack, the Tapestry brands, which we acquired 2 years ago, continue to outperform the market and to benefit from the integration into the TFG retail ecosystem. Having taken you through the detail, if we just stand back, TFG Africa converted a base-impacted flat turnover into a 6.6% growth in gross profit. Whilst we've seen how tough the trading conditions were for pretty much all of the current H1 period, we have started to see some green shoots in terms of decreasing inflation, energy prices and interest rates, which, together with the much anticipated initial flows from the 2-pot retirement reforms in South Africa appear to have had a positive impact on recent trade. For the 5 weeks post H1, TFG Africa turnover grew by 8.3%, 5.9% like-for-like versus having been flat for the first 6 months. TFG London turnover, excluding our recently acquired White Stuff, improved from minus 8.2% to plus 0.3%. And if we include White Stuff on a pro forma basis, which does include their prior-year sales in the base, the TFG London turnover grew by 5%, demonstrating the particularly positive momentum and significant impact of White Stuff. TFG Australia turnover also improved from minus 2.4% for the first half to almost flat for the 5 weeks. Very importantly, our gross margins across all 3 territories either held or improved further. Now the 5 weeks is obviously a very short period, and we can't necessarily construe this as a trend. However, the consistency of the trends across the 3 territories is encouraging, and it also demonstrates how quickly a more positive environment translates into better results in our business. Ralph and other TFG presenters will provide a lot more granular detail about the results in their presentations. I will now share some of the strategic progress that we've achieved over the past 6 months. In terms of our TFG strategy, hopefully, everyone is now familiar with our BOLTS strategic pillars. For us, BOLTS is much more than a catchy acronym. It's a robust framework to help ensure that at every level of our organization, our teams and our people understand our strategy and the part that they play in delivering it. In terms of building out, the Tapestry brands that we acquired 2 years ago continue to outperform the rest of the home and furniture segments in South Africa, both due to the market-leading brands in this portfolio; Coricraft, Volpes Linen, Dial-a-Bed and The Bed Store, as well as the benefits that being part of the TFG retail platform bring to the businesses. Tapestry continues to benefit significantly from the exposure to TFG credit with ZAR 118 million worth of credit sales in the first half, a growth of 57% on the prior period. This, however, still only equates to a credit contribution of 7.4%, and there is a clear runway to growing credit sales in this segment to closer to 20% over the next couple of years. All of the Tapestry brands continue to benefit in terms of both product availability and the higher gross margins associated with their own vertically manufactured products. Their 3 owned and fully vertical integrated factories produce, in aggregate, more than 50% of their furniture, linen and mattresses with a gross margin improvement of between 5% and 10%. As a data point, we now sell more than 50,000 sofas a year across @home and Coricraft and nearly 80% of these are locally made. From an expansion perspective, we've assisted Tapestry in identifying, negotiating, building and opening 51 new stores since the acquisition with a very strong pipeline ahead. Again, standing back from the detail, the acquisition of Tapestry has allowed us to rapidly achieve scale in a segment where we were underrepresented and helps to provide a base for building out a very significant business over the next 4 to 5 years. Two weeks ago, we announced the acquisition of White Stuff in the U.K. There's been a lot of interest in this acquisition, together with more than a few questions regarding the origin of the name. This brand was founded 40 years ago by the very talented team of George Treves and Sean Thomas, who were both passionate skiers and originally named the brand The Boys from the White Stuff, as a reference to the snow and slopes of Europe. The brand has gone from strength to strength, particularly over the last couple of years, and we were very excited to be able to welcome White Stuff and their team into the TFG fold. We are now able to confirm that we acquired the business for GBP 51.7 million. And for the year to the end of April 2024, they generated GBP 155 million of turnover and just short of GBP 9 million of EBITDA. Whilst there's still a way to go until the end of the FY '25 year-end, they are likely to grow EBITDA well north of these levels, and I suspect we will end the year having paid a modest multiple for a very healthy business, which has a clear growth path. The acquisition was funded off the U.K. balance sheet, and it will be accretive immediately. What attracted us to White Stuff? Well, we like that the business is largely driven by their own channels to market. They have a well-established online business, which we can help to further optimize. It gives us diversification out of what has been a concentration in smart and formal women's wear. White Stuff is very much lifestyle casual and includes both men's and kids categories. We believe that there are further margin and efficiency opportunities within the TFG stable. They have a limited but quality exposure to department store channels and are predominantly direct-to-consumer with further international expansion opportunities. In terms of scale and relevance, this pro forma table shows the shape of the combined businesses for FY '24, where you can see it adds roughly 50% to our TFG U.K. turnover and 35% to their profitability. From a TFG Group perspective, this gives us a sizable ZAR 11 billion U.K. business and takes our overall international business contribution to roughly 33% versus the 67% derived from TFG Africa. Justin will talk more about the positioning of the product relative to our existing brands. However, this diagram is useful in easily contextualizing its far more casual positioning, together with its more widely accessible price points. I'm also very excited to share that we'll be opening our first flagship JD Sports store in Canal Walk on 15 November, just ahead of peak trade. This will be an 800 square meter prime location store and will be followed by Eastgate in December and further stores early in the new year. We are still planning on opening more than 50 JD Sports stores and are really looking forward to proudly bringing the best sports lifestyle brand in the world to South Africa. Jet continues its reinvention and strong performance within TFG. You may remember that in year 1 and 2, after a long period of neglect, we concentrated on consolidating their product ranges, securing a new supplier base and differentiating our market positioning for Jet. During year 3, we renegotiated their leases, rightsized a number of oversized stores and optimized their store estate, closing 37 stores that didn't meet our criteria. In year 4, during the first half of this financial year, we relaunched 20 revamped Jet stores with great success. The revamps are all the same size as the original stores, however, they look cleaner and sharper. They have much better delineation between their clothing, cellular and homeware offerings and have better, modern high-density railings and fixtures. The revamped stores have improved their trading densities by 38%, and they've traded more than 30% up on their existing base with Jet Home leading the category performance with their revamps trading 48% up. Across the full chain, we've seen a significant improvement in their gross margins with their clothing gross margins having grown from 38% in FY '23 to 39.5% in the current year and their homeware gross margins having improved from 37% to 40%. These improvements, together with the resetting of their cost base has taken their H1 profits up 85% on what was admittedly a tough H1 last year and we expect their full year profits to be well ahead of last year as well. We remain really excited about Jet's potential and plan to continue the revamp program while we continue to further improve both their product and their margins. Moving to optimizing in our BOLTS framework, we continue to make good progress in our transition to a demand-led supply chain. Our new Riverfields DC has gone live. We are ahead of schedule in terms of our phased migration of brands into the new DC with sports and women's wear moves completed. We anticipate that all of our apparel brands will be operating from Riverfields by the end of April 2025. Now, this remains a very important investment for TFG and offer significant steady-state savings in terms of the consolidation of our existing DC network, our own e-com fulfillment and in terms of inventory holdback, sales and margin benefits. Early indications are very positive in respect to the product that is currently flowing through the new DC. We have managed to reduce our replenishment time through the DC from 4.6 days to 2.6 days and we've improved in-store availability from 84.9% to 91.8%. In terms of the transform in BOLTS, Bash continues to gain even further traction as the leading South African fashion and lifestyle digital shopping platform. Bash recently hit 5 million downloads and has seen off a number of leading local competitors at a time when large international pure plays have gained traction in South Africa. Our first-half revenue grew by 48%. Gross margin expanded by 400 basis points on the back of far higher full-price sales. Gross margins grew by 71%, cross-shopping orders grew to 31% of total orders and our faster, cheaper Bash own-mile delivery orders grew to 10% of the total parcel shipped. Importantly, we haven't invested in the Bash platform purely for e-com sales. Bash is now an important part of our overall retail ecosystem. On average, we had 700,000 daily visitors to Bash in H1. And of these, 100,000 customers chose to use our store stock locator function every day to find a convenient physical store that had their desired product. Now, through our rewards data, we know that these 100,000 customers spend on average ZAR 500,000 per day buying these geo-located items in the store within 3 days of the lookup, which already equates to ZAR 182 million a year. In terms of leveraging our assets, we've continued to test BashStore, our in-store selling version of the Bash app, to empower our sales associates to ensure that we never miss a sale and to ensure that our customers never leave a TFG store without getting what they were looking for. We are currently testing BashStore across 517 of our stores. We've trained more than 5,000 of our sales associates to use the technology and deployed more than 1,000 BashStore devices. So far, we have seen a significantly larger average basket size, significantly higher gross margins, and significantly higher click-and-collect rates, which will further lower fulfillment costs once we reach scale with online fulfillment flowing through our new Riverfields DC. We are obviously still in early days in terms of BashStore, but it is already bringing our mission of creating the most remarkable omnichannel experiences for our customers to life. [Presentation] In terms of sustaining our business for the future, TFG turns 100 years old this year, which is a rare and special achievement in today's world and something that we plan on celebrating later in the year. We do plan to ensure that TFG, our stakeholders, all the people that we serve and support as well as the environment that we operate within are all sustained for at least the next 100 years. With this in mind, we continue to localize and enhance our proprietary Quick Response manufacturing capabilities with 4 out of 5 of the apparel items and nearly 50% of the furniture and homewares that TFG Africa sells now being manufactured locally. We currently employ more than 6,200 people in our own factories. This is very important to us, both commercially, but also because we know that each of these manufacturing employees supports another 6 to 7 people in South Africa, and because we know that the only way that a retailer can truly ensure the working conditions of the people who produce the products that we sell is through owning and managing our own factories. Whilst we've made huge progress in this area, there is more good to be done and more upside to capture. Hopefully, all of this has provided some context as to the environment we've operated in during the period, our results and our strategic progress. I'll now hand over to Ralph for his financial performance review.

Thanks, Anthony. Well, as you've heard, it's been a challenging 6 months. Our customers have been under real pressure, although since September, we have seen signs of improvement, especially here in South Africa as we head towards peak season. But in Australia also, we've seen improved trade in recent months. And in the U.K., we're seeing early signs that the very worst is perhaps starting to level off with inventory flows also improving there. Throughout the period, we've been very clear on our objectives, and we're pleased with how we've traded the businesses, having kept a strong focus on inventory health, gross margins and costs. We've ended the period with normalized and healthy levels of stock, albeit seasonally higher in South Africa as we enter our peak trading months here. Our debtors book here in South Africa is also very clean with all key metrics improving, resulting in a lower bad debt charge and in lower provisioning. Continuing the theme of last year, our store program has continued to focus on revamps, which is reflected in a very contained level of capital expenditure, which includes the completion of the Riverfields distribution center. And we've increased our interim dividend to ZAR 1.60 per share, 6.7% higher than last year. So if we look at the group highlights, you can see that turnover is back 2%, in line with our 21-week guidance. In addition to the tough trading conditions, that number, though, must also be measured against a base effect in South Africa, where we had to clear excess stock caused by heavy load shedding at the end of the 2023 financial year. Against that, though, we've seen a strong recovery in gross margins in TFG Africa with a normalized level of full-price sales in this half. With the U.K. and Australia also seeing improved gross margins on the back of healthier stock positions, the aggregate result for the group is a 220 basis point improvement to 49.5%, resulting in a 2.5% increase in gross profit to a record ZAR 12.8 billion. So, a disciplined trading performance in very difficult conditions with EBIT 3.4% lower than last year. Finance costs are level on last year with lower borrowing costs offset by a higher IFRS 16 charge from the new Riverfields DC from which the benefits will start to accrue from next year. That's led to profit before tax 5% back, and with our effective rate also broadly in line with the prior year, headline earnings per share is 5.6% below last year. Return on capital employed is slightly ahead of last year at 14.1% and our key gearing ratio, net debt-to-EBITDA has improved to 1.18x from last year's 1.3x. I'll now take you through the group's performance on a segmental basis. As mentioned, clearance activity elevated TFG Africa's sales last year. So the key number is gross profit, which increased by 6.6% with margins up 270 basis points to a more normalized 42.25. With a strong showing from credit and VAS, EBIT increased by 5.9%. So a pleasing result overall given the late winter and the fact that trading conditions didn't really show any improvement until September. Looking at our international businesses, in both the U.K. and Australia, top line has remained under pressure. But again, when you look at it in the context of gross profit or gross margin protection, you can see that both businesses have done well to limit the contraction in gross profits. Even though expenses grew by just 3.8% in Australia and below 1% in the U.K., well below cost inflation, profits have been impacted significantly by negative operating leverage. That said, we still generated over ZAR 700 million in the first half of the year from our international businesses, accounting for 30% of our overall group result, and before considering the additional and accretive profits that are already now accruing from the acquisition of White Stuff. Onto the salient features of the group's balance sheet. Inventories are 7.5% higher than at year-end with the seasonal uplift in TFG Africa ahead of peak season and having been a little light at the start of winter due to port delays. There is an additional element of stock investment in bringing products in slightly earlier than we would normally ship, to avoid those port delays. The TFG debtors book is 6% higher, but in really good shape, as you'll hear next from Jane. As you can see, the level of net debt is broadly in line with the same position this time last year. Looking at cash, I'm showing here the cash flows on a last 12-month basis from October last year, which shows the seasonally adjusted picture and demonstrates that there has been no change to our net debt position from the same point last year. Cash flows are, of course, much stronger as we hit our peak trading season in the second half of the financial year. Onto TFG Africa then, and the first half has been a story of five months of very difficult trade and then a noticeable shift in September, a trend that we are now seeing continue and indeed strengthen into October and November. The graph top right shows a significant delta in margin throughout the period, with the graph below that showing a consistent improvement in gross profit amounting to ZAR 470 million banked throughout the period. Looking at the P&L, you can see the muted top line and the exceptionally strong margin recovery of 270 basis points. Gross profit, up 6.6% at ZAR 7.6 billion is a record for TFG Africa. Costs in retail were slightly higher and I'll take you through that shortly, but the strong performance from credit and VAS contained in the net other income and bad debt lines meant the EBIT margin for TFG Africa improved to 10.1% against 9.5% last year, resulting, again, in record earnings before interest and tax of ZAR 1.8 billion. This slide provides a breakdown of other net income, which has increased 7.6% to just over ZAR 2 billion. This comprises interest and non-interest income from our credit business, which grew 4.6% and our value-added services comprising media business, insurance income and ongoing revenue from mobile operators, which grew 15.1% on a comparable basis. Expenses look to be slightly higher than in the prior period, but this is, again, a function of last year's higher sales base resulting from the clearance activity. In fact, trading expenses have been well managed, up 7.4% on a comparable basis with store expenses contracting by 2% on a like-for-like basis, a really good result. Depreciation is significantly lower given the reduced rate of new store openings and both occupancy and employee costs grew below the rate of inflation. The growth in total costs of 7.4% is also inflated by unrealized and non-cash ForEx translation losses. Excluding those, total costs were just slightly more than 6%. Capital expenditure for TFG Africa is ZAR 150 million lower for the period at ZAR 573 million with fewer new stores this year. The elevated number last year includes the acquisition of the 91 Street Fever stores. Excluding those, there were still 77 new stores last year against this year's 34. About 60% of CapEx was invested in expansion initiatives with, as I've said, the Riverfields project now substantially complete. As mentioned, inventory levels have now fully normalized and the increase from the year-end position is mainly a function of seasonality. But importantly, inventory health has improved considerably, as you can see in the charts, with 58% of stock less than 8 weeks old compared to 52% last year. That also shows in the improvement in stock turn to 2.5x calculated on a merchandise view, up from 2.4x last year. And finally, an update on our recent acquisitions. Tapestry, despite a difficult homeware environment, increased turnover and profit by 14% and 16%, respectively, as we continue to invest in store openings across the portfolio. Like-for-like sales were also strong, showing growth of 11 % and a stellar performance by Jet in this period. Sales back 4.9% after rightsizing and refreshing the portfolio. And whilst like-for-like sales were 1.5% lower, trading densities improved significantly and profit was up 86%, confirming our previous guidance that this business is continuing to generate significant growth in earnings for the group. And with that, over to Jane to take us through the TFG Africa Credit segment before Justin and Dean take us through the results from the U.K. and Australia.

Thanks, Ralph. So, how is the world of credit? To be honest, it's been a really good 6 months, and the portfolio is well-managed and delivering better than our expectations. As a result of the good performance of our debtors' book, we have further increased our accept rates this past half year, and we are now at 20.3%. We have gradually been increasing our accept rates over the last 24 months, and we will continually review our accept rates to see if they can increase further. This is obviously good news for the retailers. And in the last 6 months, we have increased our new accounts by 9%. For the first time, we have also shown a bar graph, which shows how much new accounts represents in terms of total credit turnover. You can see in this half year, 28% of our credit turnover is from new accounts, which we've defined as accounts less than 12 months old. We know that new accounts carry a higher risk than existing accounts. So the contribution of new accounts is key when you're managing the overall health of the portfolio. If you look back to pre-COVID days where we had accept rates of 35%, the proportion of new accounts contribution was roughly 27%, showing just how carefully we manage the risk of the portfolio. The credit turnover for the first half of the year was muted at 1.7%, but this is particularly as a result of April and May, where we had negative credit turnover growth, reflecting tough trading conditions. The last 4 months, we had credit growth of circa 6%, and we expect this to continue going forward, if not slightly higher, particularly as a result of the implementation of the 2-Pot Retirement System. Now we know from experience just how important having our own store card credit is for the trading divisions. And when we look at acquisitions, this is often a major lever. And a good example of this is Jet. When we bought Jet, we always knew that the implementation of TFG credit for this portfolio would have significant gains. Previously, the debtors' book used to contribute about 17% of credit turnover to Jet. With the implementation of our TFG credit, this has significantly increased the credit contribution to 28%. We think this is probably the optimal range, and we are not expecting to increase it further. Just to put the Jet credit business into perspective, this is the fourth highest brand in terms of credit turnover for TFG Africa and accounts for 14% of our total credit turnover. When we purchased Tapestry in August ' 22, they didn't have a credit book. And again, we knew that TFG credit would also be a major lever, particularly allowing our existing credit base to shop at Tapestry stores. The credit contribution is already at just below 8%, and we expect to at least double this over time. Given the increase in new accounts and a slowdown of accounts written off, the account base has slightly increased and is at 2.8 million account holders. The gross book has increased by 4.1%, ahead of credit turnover growth of 1.7%, which is predominantly because of the higher interest rate cycle during this half year compared to the previous half year. For the last 6 months, the average interest rate on our book was 21.2% versus 20.3% in the previous half year. As mentioned, the quality of the book is better, and we can see this in a number of ways. On the graph, you can see the percentage of accounts that are up to date, which is represented by the blue shaded area. We are at the highest level of up-to-date accounts, that is customers who have not missed a single payment at our reporting date. Our customers are paying us more in terms of expected payments, and this is reflected in both our overdue statistic of 12.8%, down from the previous year and an improved buying position, which is now at 83%. And bad debt write-off has only increased by 1.4%, which is a good result, and our portfolio has stabilized post the significant changes as a result of COVID. All the resultant impacts on the portfolio have now washed through, creating stability in our metrics. The graph also shows the size of the gross and the net book and the provision ratio. The provision ratio of 17.8% reflects the good quality of the book. Given the increase in accept rates over the last 6 months and the fact that new accounts are at higher risk than existing accounts, we expect this provision rate to marginally increase by year-end as the contribution of new accounts in the base will increase. Our net bad debt ratio, which [ comprises of ] our write-off, recoveries and provision movement has improved to 13.1%, which is to be expected with such low write-off growth and provision improvement. The retailers like to use the phrase record when they hit an exceptional number. So we thought, well, we could also do the same in credit. And we have a record EBIT for this half year, an EBIT of ZAR 0.5 billion. Our income for the first half grew by 5%, primarily as a result of the growth in new accounts. And given the improved health of our portfolio, resulting in the low write-off growth and provision improvement, our net bad debt decreased by 9.5%. And finally, our cost growth is below inflation at 4.4%. We continually look at ways to improve our costs, and one of our main contributors to our low-cost growth has been our digitization within our environment; the Go Green project, as referred to internally. Over 95% of our communications in credit are now digital, which has significantly reduced our costs. So overall, a great result for credit for this half year. That's all for credit. Over to our London team.

Thank you, Jane, and a big welcome from London. And I'm also pleased to introduce you to our new CFO, Emma, who's sitting beside me, Emma Mackrill. And we're going to present to you today TFG London's half year results through September '24. And I think that the backdrop for these results is that we, in the U.K., continue to be affected by macro headwinds. Positively, though, we've seen some improvements in the data since the last time we spoke in June and we've had one interest rate reduction in August. So with that, I'm now going to hand you over to Emma, who'll talk you through the numbers.

Thank you, Justin. So, turnover performance this year has been challenging off the back of 2 record demand years across various product categories that we over-index and excel in. The consumer confidence remains low as interest rates and inflation remain high and the recent buildup to the labor budget announcements have created further uncertainty. That said, we are pleased that our strategy to focus on the margin outcome and acquiring profitable new customers for longer-term growth has paid off. We've delivered a record gross margin in a highly competitive market and increased our own channel customer value. EBIT has stepped back year-on-year, but overall, we are pleased with the results in the market context. We've taken some tough decisions this year to exit markets that we do not see long-term stability in; Germany, for example. However, we've continued to invest in our own stores, rightsizing the estate with bigger, better stores at the forefront of our decision-making. We have also taken the next step in our U.S. expansion plan, opening 4 stores so far this year, of which the initial results are very positive. Stock levels have increased now, but earlier in the year, Red Sea delays meant we were not where we planned to be for the season. We reacted early to this, and as a result, despite the trading shortfall, we managed our margin and our terminal stock outcome. Going into peak trading, we've brought forward intake, so we are ready and in a healthy stock position for the upcoming Black Friday and Christmas demand. I'll now hand back to Justin for the outlook.

Thanks, Emma. So, uncertainty continues, but the latest Deloitte Consumer Confidence Index shows an improving trend, which is positive. I think spending among TFG London's core customer demographic is also forecast to be more resilient. And as Emma said, we've now got the elections and the budget announcements out of the way. Inflation is looking increasingly under control, and we are certainly looking for further interest rate drops over the next period. We're also planning in longer lead times to make sure that our product intake and launch availability improves, and that will also have an impact -- a positive impact on working capital management. And I think positively, October, we've seen some green shoots coming through on trading. So coming on to White Stuff. On the 25th of October, we announced that we've added another great brand into the TFG London platform. White Stuff really is an exceptional business with an experienced and talented management team and has significant potential. It has also seen good levels of sales growth during the course of this year and is developing and has developed a good pipeline of new store openings. Importantly, for us, White Stuff has a much more casual product proposition and a handwriting that diversifies the current mix that TFG London offer. We're really excited with White Stuff and that it brings an established menswear business as well as a very good women's wear business. And with that high-energy finish, I'll now hand you over to Troy and Dean in Australia. Thank you.

Thank you, Justin and Emma, and good morning to everyone. It's Troy and Dean here in Sydney with the Australian update. I will cover the financials, and Dean will provide details on operating context. But to quickly recap, we ended the prior year in a challenging economic environment with low economic growth and low consumer confidence. This challenging environment continued into the first half of the year, but we are now seeing some positive signs as we commence the second half. Looking at revenue for the first half, it was down 2.4% versus the prior year, which was in line with our expectations for a couple of reasons. Firstly, as the market hadn't bottomed out at the end of last year and also because we did commence the prior year with a higher opening stock balance, and that excess needed to be cleared with more aggressive promotions. In terms of gross margin percentage, we achieved a 1.2% increase, which was really positive and aligned to our strategic objective. Now, if you look at expenses, they were managed in line with inflation, and we absorbed continued investment in strategic initiatives. Our EBIT margin of 10.4% remains above historical performance, which is strong, particularly given the current operating cost challenges. In terms of momentum, I would like to highlight that the second quarter performance of this half was relatively stronger than the first, and we can see some early signs that trade is improving. I will now hand over to Dean, who will provide more context on performance.

Thanks, Troy. So, in terms of the overall trend in performance, I find this slide extremely useful to put the half into perspective. Now, if you look at the graph, you can see just how extraordinary FY '23 was. It genuinely represented 5 years of growth in 12 months, a phenomenal result. This, of course, was the post-COVID boom. Now, whilst '24 was a slowdown, it was still well above normal, and we were careful when presenting those results to highlight that 12.5% EBIT margin was still well above our historic 9% to 10% range. This year, half one of '25 has started to bottom out. And despite economic headwinds, it actually feels like the economy is starting to stabilize. And our focus on normalizing promotions, controlling inventory and managing costs has delivered a solid EBIT result of $37.9 million. Back to you, Troy.

Thanks, Dean. In terms of inventory, in the prior year, we actively reduced our opening balance as the market slowed at the end of FY '23. As a result, we ended the prior year in a very good position, and this continues to be the case, both in terms of total balance and mix. Inventory quality remains strong. Approximately 85% is current season and over 40% of that is core, which is product not linked specifically to a season. Inventory management has been a huge focus over the last 12 months, and our strong stock health has allowed us to improve and optimize GP percentage in what is still a highly promotional environment. Overall, we remain very comfortable with the inventory balance. Back to you, Dean, for the outlook.

Thanks, [ Troy ]. So, at our last presentation, we left you with the expectation that Australia had not yet bottomed out and would remain tougher for longer. This has eventuated. The economic challenges have not changed. They are all well-discussed and a sample is listed on the slide. Yes, it's a tough trade environment. But in actual fact, our business, which benefited so much from the post-COVID boom, has simply been bottoming out to more normalized levels. As a result, promotional activity and costs have had to be carefully managed during this period. So, all of that being said, over the last 6 months, there are 3 areas we are extremely pleased with. Firstly, in a period where cost management has been critical, the business has managed to control costs without sacrificing our business or our growth initiatives. Secondly, in an environment where consumers have been discount-led, we have been able to normalize our promotional activity, stabilize our inventory and improve our gross profit percentage. And finally, as previously mentioned, our H1 financial result remains well above pre-COVID historical levels. Now, in terms of the outlook, there are signs that the economy is improving. Unemployment remains low. There is an expectation that the next interest rate movement will be a reduction and consumer confidence is starting to gradually improve. As a result, the current trade environment, despite the challenges, actually feels reasonable, and we're now prepared and looking forward to our peak trade period, which is just ahead of us. So, finally, a quick thank you to Troy and the team for their commitment over the last 6 months. It's been great. Thanks, everyone, and back to you, Anthony.

Thanks, Dean and Troy. I'll now share some thoughts on our strategic focus and outlook for the rest of the year. Over the past number of results presentations, I have increasingly been referring to the unique TFG Africa retail ecosystem that we've been building and investing in. A lot of effort and capital has been deployed into building this ecosystem, which serves both as a more efficient platform as we continue to grow and scale our business as well as a strong moat against all-comers. And when I say this, I guess that the newly arrived international pure plays spring to mind for most of us. In order to demonstrate the scale of what we've built, I look for a couple of key data points that illustrate the incredible customer reach and relevance that our ecosystem already has. For this full FY '25 financial year, we will have in the region of 500 million people enter our 3,700 TFG Africa stores and nearly 250 million online sessions via Bash, which are both pretty incredible numbers when we live in a country with a population of 63 million people. How do we know this? Well, our online sessions are obviously easy to measure and track. And in the case of our stores, our stores are equipped with very accurate technology that counts the number of people entering and leaving our stores every second that they trade. We now use several years of history to plan our staff scheduling, and we then combine this footfall information with our point-of-sale information to measure the conversion rates of our different stores and to manage their performance. In addition to just getting hundreds of millions of repeat physical and digital footfall every year, our customers are also incredibly loyal to our brands. We have further grown our TFG Rewards base to 38.8 million South Africans, of which 15.2 million are active shoppers and we have a loyalty swipe rate of more than 75%, which in itself is considered world-class. And speaking of loved brands and engaged and loyal customers, the chart on the right illustrates that TFG has as many social media followers as the rest of the other South African clothing retailers combined. Given this ecosystem, our reach and the number of customers that we continuously interact with, it should be no surprise that we are confident that we have a number of very high potential growth opportunities that we are currently working on. Now whilst by definition, this is all work-in-progress and some will [ under ] and no doubt others will overshoot, it should provide some sense of our direction of travel and what you can expect to see from TFG over the next 4 to 5 years. Our value stack is expected to grow from its current ZAR 10 billion to ZAR 16 billion as we start to meaningfully invest behind our value businesses now that we've got Jet back onto a good baseline. Our homeware stack continues to outperform, and we see this growing from its new post-Tapestry base of ZAR 5.4 billion to something closer to ZAR 10 billion as we expand both our existing @home business as well as the various Tapestry brands. Our value-added services business, which includes our cellular business, should grow from its current ZAR 4 billion to at least ZAR 6.5 billion as we continue to drive both our in-store and digital VAS strategies. Earlier, you saw that our beauty business grew rapidly over the first half. This was as a result of our newly launched beauty strategy, which will grow beauty from ZAR 1.2 billion to more than ZAR 4.5 billion. Our JD Sports partnership is likely to reach ZAR 2.5 billion from a cold start this year, and Bash may well exceed ZAR 4.5 billion as it continues its market share growth in South Africa and perhaps beyond. That's somewhere in aggregate in the region of a further ZAR 20 billion of growth across these areas, which obviously sits on top of the organic growth in the rest of our business. There's obviously a lot to play for here. If we look slightly further ahead, it's clear from this analysis that while we continue to produce market-beating growth in our existing retail verticals, the reality is that the clothing, furniture and footwear segments account for less than 10% of household spend in South Africa. Put differently, there is the other 90% of consumer spend where our existing loyal 38 million rewards customers spend their money in adjacent categories and where we have very little or no share of wallet today, which in itself provides a plethora of fresh retail or consumer opportunities for us to explore over time. In conclusion, whilst there are obviously still reasons for caution, I believe that there is increasingly reason to believe that we may quite possibly be entering a more customer-friendly cycle than we've seen for some time as; the cost of living pressures ease, the 2-pot pension reforms provide a much-needed liquidity injection into our market and consumers start to feel a bit more comfortable. We think we've already seen some of these green shoots in our post-period trade. We have a rapidly scaling retail platform and a massive ecosystem of customers through which we plan to take a greater share of wallet. We have an incredible portfolio of healthy brands. We have a number of clearly identified growth vectors over and above business than usual. And as I said in my earlier introduction, we have a strong focus on enhanced profitability and shareholder returns, and ultimately, a higher share price that benefits everyone. Now the peak trading season is around the corner, and this will obviously dictate how the full year plays out, but we've done everything we can to be prepared for this. Thank you for joining us for this presentation today. We'll now take a 5-minute break and then return for Q&A. [Break]

Welcome back, everyone. I see we have a number of questions that have come through during the course of the presentation. And I do have Ralph and Jane with me to pick up specifics as well as the U.K. and Australian teams to the extent any specific questions on the other geographies. The first question is, "Please, can you talk about the outlook for gross margins for the second half in each geography? Can we expect to see further improvement?" Quite tough to call it. I mean it is our peak season over the next couple of months. But I think if you look at South Africa, there's probably another 50 basis points in it through to the end of the year. And Australia, probably somewhere similar. I think from a U.K. perspective, we're probably at optimal margins where we sit for the first half. Second question, Ralph, I think I'm going to pass this one to you. Why was there a working capital outflow in the first half?

Thanks, [ Paul ], for the question. Yes, that's -- so the increase in net bad debt -- sorry, in net debt from March is about ZAR 3 million. ZAR 2 million -- just over ZAR 2 million of that is the peak season stock build-up towards the end of the period.

Yes. And I think -- sorry, just to add to that, I think everyone is aware of global shipping delays. That's obviously affected South Africa, both on a global basis and [ equally ] from a ports perspective in South Africa. We've been very clear that in South Africa, the impact on getting stock into the country has been very well managed on our side. We really haven't had an impact in terms of lost sales, but it does mean that you have to plan longer lead times. And part of what Ralph just referred to is ensuring that we do have all the stock that we need for peak season and that came in before the end of the first half. The next question is, "What was the like-for-like revenue growth in TFG Africa for the first half?" I don't have the numbers in front of me, but I think it was roughly minus 1.8% or 1.9 %. Certainly less than 2%. The next question, what was internal inflation in TFG Africa in the first half? I think we measure inflation in 2 ways. Input inflation was about minus 1.4%, 1.5% -- sorry, plus 1.4% or 1.5%. Selling inflation, slightly below 5%. I think it's quite positive. It means we've entered an environment just in terms of the interest rate and inflation cycle where we actually are able to pass on costs back to the customer. That's been very difficult over the last couple of years, certainly since COVID. I think, Ralph, back to you for this one, "How should we think of dividend payout or dividend cover for the full year?"

I think broadly in line with the same -- final dividend that we had last year, which was covered 2.75x. No reason to think that that's going to be largely any different.

Thanks, Ralph. How has Tapestry performed in terms of revenue and margins in the first half? Ralph, I think you actually had a slide on that, but maybe just to remind everyone in case they missed it.

So, yes, 86% up in terms of profits. Sales slightly back as we repositioned the store portfolio, but an excellent result from Jet for the first half again.

Thank you. Tapestry. Please, could you...

Sorry. Sorry, I answered the Jet question.

Yes, that was the Tapestry one.

Sorry, Tapestry as well had a really good first half, as we explained. Profits up 16% and turnover up 14%.

Great. Thank you. And again, in case there was any confusion, just on Jet, clothing gross margins heading towards 42%. What's actually even more pleasing is, particularly post those revamps, we've had a real kick in homeware sales and those margins are trending up towards 43%, 44% above clothing and certainly part of that 85% profit growth that we referred to. The next question is, thanks for the detailed disclosure -- sorry, no that's covered already. You've seen a significant sales increase since the first half. Is this related to the 2-pot retirement system and more disposable income for your consumers? I think 2-pot is definitely part of it, but I think there are a couple of things that have kind of come together positively more or less at the same time. We've obviously had a very positive political outcome in South Africa. If I compare that to the month or so pre-elections, the market really dried up. You could see consumers weren't spending. They were staying away from shopping malls. Footfall was down. That picked up literally a day or 2 after the elections, and I think that trend has continued. South Africa has generally been a more -- in a more positive space. We've had no load shedding, touch wood, for, I think, over 200 days now. That obviously takes time to generate economic growth, but I think there's a consumer psychology piece to that. We've had an interest rate cut. We've had fuel prices coming down. They may kind of tick up again next month. But net-net, I think quite a positive impact on cost of living and putting more money back in consumers' wallets. And then, ultimately, 2-pot has come in. If you look at the reports coming out from the insurance houses, there's some big flows that have started. Some debate in terms of where that money is being spent, whether it's repaying debt, education, et cetera. The reality is, I think, from a retail perspective, most of those flows tend to be circular and they tend to get back into consumer spending at some point. So, quite hard to isolate to the extent of each of those. But I think, yes, definitely part of it. What do you expect the budget changes in the U.K. to National Insurance could to do to your cost base for the U.K. business next year? Look, that announcement was obviously very recent. Justin and Emma are busy working through some modeling on that at the moment. There undoubtedly will be some inflation in terms of store staff, salaries in particular. I doubt it's a big number. It's probably somewhere between GBP 1 million and GBP 2 million. At the same time, I think very similar to my comments on the 2-pot retirement system, that does put more spending power back into your average consumers' hands, and ultimately, it's really a stimulus at the end of the day for consumer spending. So it probably nets out over a period of time, I would think. Ralph, this is definitely a question for you. Can you speak to TFG's debt maturity profile and any refi requirements? Under what circumstances would TFG take on additional leverage?

Sure. Yes. So we have -- our debt maturity profile is, as you would expect, nicely staggered. Our first refi is in March 2026, so about 18 months away, just over ZAR 2.5 billion. And we will just then put that at the end of the lot out to 2029. We are not looking to take on any additional leverage. We're very happy with the level of leverage that we have. We have about ZAR 7 billion worth of net debt, and you could consider that against a book of ZAR 11 billion -- a gross debtors' book of ZAR 11 billion.

Yes, bit of a natural hedge. Next question. Please, could you talk to the long-term strategic intent in the U.S.? How many stores over what term? Any thoughts on inorganic growth? Very good question. You would have picked up that both the U.K. and Australia have an interest in the U.S. It's really Johnny Bigg out of Australia and mainly Hobbs at the moment out of the U.K. We being -- we see the U.S. as -- it's obviously a huge market, it's got big potential, particularly in terms of U.K. brands. They're highly sought after in the U.S. and in many cases, attract higher price points for similar product. It's kind of the TFG London cache in the consumers' mind. Having said that, the U.S. is obviously a huge market. You have to commit sometimes big checks if you want to go in aggressively. We don't want to take those sort of risks. So we're approaching the U.S., I think, firstly, very cautiously, but secondly, in a more and more joined up way between Australia and the U.K. We've got a team working together, and we're really making sure that any presence in the U.S. is a combination of department store concessions, which help to market your brand, some stand-alone stores in very select areas and obviously a strong online presence. We've opened a couple of stores in the U.S.; 4 recently, all trading very well. But obviously, it's a very short time period and probably too early to draw any conclusions. To what extent does TFG have any appetite for further acquisitions following the purchase of White Stuff, which markets and sectors? Look, I think for both Australia and the U.K., we've been signaling for some time that both of those businesses would benefit from the addition of at least another brand. And we've seen White Stuff. So I think the U.K. team is going to be busy with them, continued running their own business and picking up White Stuff for the next while. Australia; there are opportunities in the market that we continue to look at. A lot of what was on the market was significantly overpriced in that bubble coming out of COVID. I think pricing expectations have come off as the markets tightened up. So we'll see what develops there. And then I think I did have a couple of slides in terms of TFG Africa. We've got a really well-developed retail platform here, have 38 million customers, the majority of the country shop with us. Our ability to plug in new brands, potentially some in sectors that we haven't played in before is increasingly obvious to us. Tapestry in a way is probably a really good illustration of that point. Most of what we acquired in Tapestry were brands or concepts or supply chains that we'd actually never dealt with in our existing business, quite different from our @home business. And again, Ralph shared just how pleasing the Tapestry results have been and how additive they've been. It really does, I think, give us a bit of a blueprint for where we can go further. Trying to see -- some of these are getting into repeats. Let's just try and find new ones. A couple of questions on 2-pot, couple of questions on acquisitions again, but I think those have been answered. Here's a new one. What is the timeline for Bash profitability? We -- a good question again, something we've been very focused on. Originally, we thought that was going to be another 2 years from the end of this financial year. Most of the last 6 months, Bash has either been breakeven or profitable. We've got there a lot, lot quicker than we thought we would, a combination of taking substantial market share. I mentioned seeing off a couple of other local pure-play competitors. I think we picked up a lot of their market share. Part of that online model, you've got a fixed cost in terms of the central team. If you add more revenue at the right gross margins, a lot of that drops straight down to the bottom, and that's what we've seen. And we've also seen some really great efficiencies, particularly in fulfillment costs. The combination of all of the above, I think, has helped us get to that breakeven/profit level, as I said, a lot quicker than we expect or expected. And hopefully, we then land it fully -- for the full year by the end of March. Dean, a question for yourself, and they've actually asked for you by name. Dean, please, can you give us a sense of what you believe your normalized margin? And I guess for that, you can probably take gross margin and operating margin will be for TFG Australia over the next couple of years?

No worries. Thanks for that. Thanks for asking by name. I'm flattered. In terms of the margin, look, we're very comfortable that we returned in that first half to the normalized level. At the GP level, 65%, we do consider that about normalized. Look, and half 2 of last year, we pretty much did most of that work already. So we think we're there. Now we just need to actually maintain that. So, that's the short-term view, 65% is about right. In the longer term, depending on the growth of the value sector versus mid-market because we have both sectors, if value continues to outweigh, it could creep slightly lower, but we're certainly doing everything we can to keep it around that level. So comfortable with where we're seated.

Great, Dean. Thank you. Another very good question has just come through. I showed that slide on some specific areas of potential growth for TFG Africa. The comment goes to the point that, that growth would account for roughly 40% of TFG Group sales today, which is probably about right. It worked out, I think, to about ZAR 23 billion in aggregate. Having said that, I mean, I did make the comment, some of those -- that's looking forward over a couple of years, some of those will probably overshoot, some will probably undershoot. So somewhere around about ZAR 20 billion if we pursue all of those as we're intending to at the moment. But the underlying question is, what is the expectation for growth for the other 60% of sales? I think we've already dealt with Australia and the U.K. in some of the previous questions. So I'm going to concentrate this really on the South African business. Again, this is obviously going to come down partly to how the macro environment plays out. But our own expectation would be, we would expect our kind of core business to grow somewhere between 7% and 10% over the next 4 to 5 years. That might seem like a high number given where things have been over the last year. But if you look at, again, the last 5 weeks, we were up 8%, like-for-like was up 5.9%. And if you look at the last 10 years, including the COVID period, the rioting, looting and all the other headwinds we've had, our growth CAGR has been in the region of 10% despite all of those headwinds and setbacks. So it's probably a fair number between 7% and 10%. And there's a second part to the question, do you expect some cannibalization as you take on more brands, et cetera, for example, JD Sports taking market share from Sportscene? Look, I think everybody competes with each other. There is always some cannibalization. Whenever we do a viability, which is the model that we run before we sign off on opening a new store, we build in quite aggressive cannibalization factors. And so far, there are very few instances where we've even hit that assumption. In other words, the cannibalization is generally less than we are assuming, and we build that into the viability in terms of whether you want to open the store or not. So, yes, some cannibalization, but we manage it. Jane, one for you. Have you made any adjustments to your credit granting criteria? Or is the improved acceptance rate a reflection of improved customer affordability in South Africa?

Thanks, Anthony. Yes, we have made some adjustments to our credit granting criteria. And it is because there is improved affordability. The consumer is performing much better than we expected, and we're seeing much improved payments efficiencies, which means we are able to change our credit granting criteria, which is obviously great news for us.

Great. And then I think, Jane, there's another question, which kind of relates to that. I'll pass it to you at the same time. What leading indicators would you look at to judge the health of the consumer?

Great question. We actually use internal indicators as well as external indicators. So looking at internal indicators, for every tranche of business that we book for every month, we look at early indicators such as your delinquency. So how many customers have missed one payment within the first 2 months of opening that account? We look at things like buying position. And so we look at those early delinquency statistics to say, are our accounts performing for those tranches as we expect? And we have targets for all those different things. And then we look at external indicators. For example, we'll look at fuel prices. We know fuel prices has a massive impact on the performance of how our consumers pay their accounts. So where are the fuel prices going? Are they going up or are they going down? And that has an impact on how we look at the health. And then we can look at bureau information, for example, Consumer Credit Index, which goes into all of the consumers' credit profiles. Have they got more money? Are they using their credit cards more? Are they using it less? So we use both external and internal indicators to look at the health of our consumer.

Great, Jane. Thank you. Very comprehensive. Ralph, one for you. Can you provide some cost growth guidance in South Africa for the full year? And I guess that's obviously against the context of some very tightly held cost control in the first half.

Correct. So I think that we would like to keep it within kind of the 6% or 7% range for the full year.

Great. Thank you. Justin, 2 questions for yourself and Emma. The first goes to the balance of concessions versus stand-alone stores. You still have 200-odd concessions in the U.K. What would the balance -- what would the ideal balance be in terms of concessions versus stand-alone?

I think the -- thanks, Anthony. I think the -- it's a good question around direct versus partner sales. I think we're at a good level in the U.K. in terms of our overall concession business. We've got some good, strong, well-established relationships with strong balance sheets essentially. And where we've had a lot of change in the market with House of Fraser and Debenhams in the past, that feels a lot more stable at this point.

Great. Thanks, Justin. And then the second question relates to White Stuff. White Stuff appears to have older average demographic, 55-plus. Could you expand on the rationale for targeting that age group?

Sure. I think there's -- we're very excited about White Stuff. We're really excited about that demographic for a number of reasons. They're a loyal demographic. They are extremely resilient. If you look at the consumer spend data over the last 12 months, where you've got younger generations are very much under pressure in terms of rents and cost of living. The older generations have been much more resilient. So, as you go through the age curve, it becomes more resilient, and there's been more growth over the last 12 months. So we're really excited about it as a demographic; they're resilient, they're cash rich. And particularly given the new -- the recent -- as you said, Anthony, given the recent budget, there were rumors that there were going to be a demographic that was targeted in terms of pension tax, that hasn't happened. So we are -- yes, we're excited about the demographic that we've inherited with White Stuff.

Great, Justin. Thank you for explaining that. Ralph, this one, I think, plays very much into the corporate model that you've been working on. Given the focus on costs or cost control over the last while, together with the recovery in gross profit margins and the expected improvement in top line, what are you targeting in terms of an operating margin for the South African business over the next couple of years?

Well, over the next couple of years, I think we want to get to 14%. I think there's going to be a journey towards that, but we're pretty confident that we can -- that's what we can achieve.

Fantastic. Thank you. Guys, that wraps up the questions. Again, that was a, I think, very good coverage of all of our different parts of our business. Thank you again to everybody who dialed in for the call today. A big thank you from my side to the team that made this possible. There is a production team that kind of makes all of this happen on our side. And then finally, a very sincere thank you to the entire 48,000 TFG family members who have worked very hard to deliver these results. Enjoy the rest of your Friday.