Good morning everybody. Thank you for your time today.

I'm going to start on page 3, Hannah, if if if we may, with the the the the the the financials. What...

Oh, here we go. Yep, there we are.

Obviously, numbers numbers disappointing relative to H1 last year, but but entirely in line with the guidance, the revised guidance we gave back in June 2025. Maybe just a slight beat on on the revenue.

I'm going I'm going to leave it for Chris to to go through those numbers in more detail later on. As as as we expected when we when we when we issued that guidance before the start of of the financial year.

What I wanted to do today is spend a little bit of time, I suppose letting our investors behind the curtain a little bit. There is a lot going on in the background, and I and I thought it would be useful to give you some insights as to what it is we're we're we're doing.

I want to go over on to slide 4. This is a very simple graphic which I I sort of put in front of our senior management team last month.

This is the kind We call it the squeeze. This is the kind of challenge that many consumer businesses are facing in the current environment.

It's a tough environment, therefore it's it's it's difficult to move the revenue line, and and certainly the market as a whole won't move that revenue line for you. Costs are escalating, and we've seen quite an extended period of of of high inflation on the cost side, particularly through through the payroll line.

It is it is a period where really only self-help will do. There's no there's no sort of macro forces which are going to float all the boats, and and that's what our focus has is is very much upon.

I was at a dinner many years ago where Justin King spoke, and these were these were better times for consumer businesses, and and he he he talked about an escalator, and he said, "When the markets when markets are good, you can be on an escalator, and you can stand still, and and still go upwards. Sometimes you can even walk backwards, and and still go upwards."

At the moment, the escalator is kind of going down, you have to you have to to to run hard in in order to deliver growth and and and and and investment returns. Let's go over on to page 5.

Our self-help has always got to start, of course, with the commercial teams. This is what we call our commercial triangle.

This is the sort of interface between our brand department led by Tracy Carroll, our product and buying department led by Katie Maxwell, and our sales department led by our chief commercial officer, Duncan Duncan Singleton. For us, a big part of our focus in terms of that self-help is is is making this these parts of our business, individually and collectively, as as as effective as possible.

Since we appointed Tracy, Katie, and Duncan into their roles at the beginning of September, we have seen a a a marked in in in improvement in in the in in in the way these key commercial functions are are operating. This is this is critically important because it does deliver a competitive advantage.

The the ability to deliver a coordinated offer across these these three fronts is often something our competitors cannot deliver, either because they don't have, for example, a marketing department, or perhaps if it if it's part of a larger international group, it may be that the the local team is is just a sales team. Our ability to to to provide a a coordinated offer across marketing, product, and and and and and sales effort is is is going to be critical in terms of that self-help going forwards.

Let's let's start with brand on page 6. Tracy, who's our chief commercial officer, started as our brand director back in November 2022, and she started by rebranding Salter, and then Beldray, and then finally those supporting brands: Petra, Progress, and Kleeneze.

That is all now complete, which is a hell of a lot of progress over over over only a few years, and really provides a a a stable and effective platform for for for our brands going forward. If we go on to page 7, what we have, we have seven guiding values.

One of those is that everyone must love our brands. Tracy is Love, by the way, dictionary definition: a feeling of deep affection.

This is something which, for example, I as CEO cannot mandate, "Thou shalt love our brands." This is something which must come from within the teams.

It's important that all of our personnel, believe and and and and indeed love our brands, particularly Salter and Beldray. Tracy has been very effective in driving this throughout both her teams and and the wider teams in the business.

You can see there our brand goals, which she's taken that that brand value that brand value, and and widened it out. We now have clear brand strategies for all of our brands.

A particular focus on Salter and Beldray, they are 60% of our revenue. Salter is our scales and kitchen brand, kitchen covering kitchen electrical and cookware.

It's the UK's oldest housewares brand. It's It's over 250 years old.

It dates back to 1760. It's older than the United States of America.

It's a it's a it's a fabulous brand with an amazing heritage. Beldray is a mere nipper at 150 years old, and this is our laundry and floor care brand.

Laundry because that's where its heritage is. It was the originator of the pop-up ironing board back in the early 20th century.

Again, a really a really sort of beautiful brand with with with a long heritage. Let's go on to page 8 and talk about product.

I mentioned before Katie Maxwell, originally from our graduate development scheme, joined the business in 2013, she was appointed chief product officer back back in September again. Again, one of our other guiding values is that everyone needs to be passionate about our product.

Again, this is this is an emotion, it can't be mandated, people either have it or they don't. Again, Katie, like Tracy, has widened this out, and this is this is an excerpt from a one of her slides that that she uses in in various strategy days across the business.

I won't go through all of it, but I'm going to just pick out certain elements. Finding passion points under use under intense user empathy, finding passion points: Where can the product spark delight?

Moments of surprise and deep emotional connection. Our products are proudly mass market.

They're great value, but if you think value is just a symmetry between spec and price, it kind of misses why people buy. There has to be an emotional connection, and we have to find what those emotional connections are.

Those of you who are familiar with us will will know that we we we, my tried, my my tried and tested analogy is is the countertop test. You buy our product, you bring it home, you put it on the countertop, and your friends come around for dinner.

If it doesn't stay on the countertop because your consumer isn't proud of it, then we failed. There has to be, of course our product has to be fabulous value, but it also has to establish an emotional connection with with our consumer, who has to be proud to own it.

If if they're not, we failed. Under strategic vision and purpose, long-term focus.

We need our teams thinking about our products not just in terms of where it's going what's going to happen in the first six or 12 months, we want longevity into our product. It's very similar to investing, product development.

There's an upfront expenditure, and then you get a return over time. Obviously, the longer that period of time, the the greater that return on investment, and and we we we need our our our product teams thinking in that way.

Under rigorous quality and craftsmanship, active curiosity: keeping up-to-date with new trends, technologies, and market changes to ensure the product remains cutting-edge. We are very fast.

We used to be a a a trading and sourcing business. We've evolved over time into a brand business, but we've retained our speed, and that's about understanding the market and then being able to bring products to to to market quickly to match those needs.

Infectious enthusiasm, this is another emotion, of course: transmit energy and excitement across the team. Katie has challenged the team not just to be enthusiastic themselves about the product, but to make that enthusiasm infectious across the business, and of course beyond that into our retail partners and and and and our consumers.

Everyone, and she's quite she's quite evangelical about this, everyone, whether you're working in accounts or whether you're working in buying, has to be enthusiastic about, has to be passionate about our product. Then finally, under resilience and productivity, and this is this is a this is going to be a recurring theme, prepare to get a bit bored, everything has to be has to be data-driven.

There's a lot more access to data now, and and the tools to interpret and access that data are, including for example AI, are are are more readily available now. We have to make best use of that to inform our product development decisions and increase our product success rates, which we have been doing with with recently.

That's not to say that we can develop product by numbers, we need to retain intuition, and we need to retain at times the confidence and the ability to step away from the data and and take the odd risk, but but but making that decision against the background of understanding the data. Let's go on to to page 9.

What you see on page 9 is what happens when brand, love of our brands, and passion about product comes together. This is This is a live brand campaign, and I would encourage you all after maybe after the call if if you if you if you if you're minded to, to to get online and and and see what we're doing here.

This is probably the the first time we've been able to bring all the strands together of of brands, product, and then all of the various sort of marketing tools that we've been developing over over recent years. This is the all-in-one floor cleaner.

It's Which? Best Buy.

In In that means it's beaten brands like Dyson, brands like Vax, Kärcher, Bissell, etcetera, to win this award. It's a fabulous product.

It's a product which, despite beating all those esteemed names, is is is is is less expensive than any of them. We've used this product and we've used the the Which?

accreditation to to to to to to launch this brand campaign across multiple touch points, be it obvious ones like our website and and and the Amazon platform, but also things like trade shows, good old-fashioned PR, and of course social media and influencers. If you if you're a fan of The Traitors, we've we've leveraged some of that as part of this campaign.

This is This is a current campaign, so, do do do do take a look if you get a moment. For us For us, though, everything we do is about providing beautiful products for every home.

That's our mission: beautiful products for every home. We are we are very, very proud to be mass market, that's the "every home" bit, but the product has to be has to be beautiful.

Where marketing comes in is to get that message across, because the consumer's first assumption may well be that if it's the lowest price, it's the lowest quality. As we move forward, we need to use our marketing capabilities to educate the consumer that that that that Beldray and Salter is in your corner, and even though it's great value for money, it's also great quality.

If we go over on to the next slide, the next stage in our development, and this is very early stage, I'm sort of This is so early stage I don't have a name for it, this this range you see here. This is about the next evolution, which is about having a a what what we call in the game a product design language.

This is about, well, you know the way with Dyson, you can see a Dyson product and know it's a Dyson product because without seeing the word "Dyson"? This is what we're we're aspiring to initially at least with with Salter.

This is a range that we're working on. I hope you agree with me that it looks, stunning and beautiful, and, it it it and I think, any person would be proud to have this in their kitchen, but it will still remain beautiful product for every home.

It will still be mass market and great great value for for money. Watch out for this.

This will be in the market during calendar year 2027. Let's go on to to page 11.

We've talked in the past about sales function transformation as part of that commercial triangle. Duncan Singleton took on this rather rather brave challenge back in back in September, stepped across from our buying function to to to be to become CCO and and and run our sales team.

There's been there's been a lot of change in a very short period of time, both in terms of, in terms of personnel, investment in training and development, better use of technology, improved management process, and and and and and better alignment of of of incentives with with with with shareholder interests. Again, this is a this is a slide that he he's used in some of his internal sort of sales sort of training days.

I won't go through all of it, I'll leave it to you to read, but I would again pick out data. We get a lot of data from our retailers from multiple different directions.

If we're going to maximize on self-help, then we have to maximize on that use of data, and we have to improve the sell-through of our products with with with with our retailers, and and and and and doing so, gain growth where where where where perhaps others others won't. I'm really proud of the team.

It's a it's a it's a very new team. It's It's a It's a it's a it's an intelligent, enthusiastic, highly motivated team.

It is a it is a it is a young team, they're going through the gears in terms of experience, but I think it's a team that is already performing as well as previously, but with significant scope for for further development and improvement. Let's go on to page 12.

Some of you will be familiar with this graphic. We started off as an internal graphic, and we've but we've used it a lot externally.

This is our what we call our productivity wheel. We talked we talked I talked before about escalating costs that all consumer businesses and perhaps all but businesses generally are are facing and have faced over these last few years.

We have a a really well embedded process of continuous improvements. It It's It's cornerstoned by our human capital, and particularly via our graduate development scheme.

What that means is we've been able to, maintain opex Our our our operate our opex is level this year for the fourth consecutive year, which I don't think many other consumer businesses would will be able to say. That's because since FY 2023 we've reduced our headcount by 20%, which is equivalent to about £3.5 million a year of of of payroll costs.

The The backbone of that to date has been our RPA program. We have nearly 1,300 RPA bots crawling around our servers every day.

That's saved 100,000 hours annually, this which is equivalent to 50 heads. The the the reduction in heads has been is is is being productivity-driven, not by compromise and maybe cutting into muscle.

For me, the real benefit of of of all of this is is is of course management of opex is super important. For me, the bigger benefits are are are the other things around the outside of that of that ring: the the commercial benefits, the ability to maintain lowest price, the the releasing up resources to invest in brand and marketing where perhaps other elsewhere other people are cutting back on that in in response to this these these these cost pressures.

Also, for me, maintaining product quality, because what we're hearing a lot is is is is our competition are are being forced into into compromise in terms of product quality. I think, that that that that potentially solves a problem today, but but but but but is is is sort of brand death, really.

That this this this underpins this work our our our our commercial efforts right across the business. To date it's been largely about RPA.

In the last 12 months, AI increasingly. The great thing about AI is we've got a process that this new tool can kind of plug into.

What I what I'm seeing elsewhere on AI is there's a huge appetite to deploy AI, but people don't seem to know how to do it. This and there seems to be a lot of, CEOs and and exec teams passing the message on, "Thou must used Thou thou must use AI."

It doesn't work like that. AI like AI like RPA works best if it's bottom-up, and and what we have in our organization is a is a bottom-up process of of of of of continuous improvement.

Just a just a mention of our PIM, which we which we launched last year. That that is that is delivering also delivering significant commercial and operational benefits, and and will continue to do so for for quite a while.

Okay. At this point, I'm going to hand over to Chris Dent, who's going to talk about the financials.

Cool. Thanks very much, Andy.

If we bring up slide 14. Yes, a disappointing set of results.

However, they are marginally ahead, especially in relation to the revenue line, compared to the guidance that we set out last June, which was for revenue to be down 8%, but the achieved result was -6%. Now, the big driver behind that has been the closure of our clearance division.

As Andy said, we're a business who is passionate about products and a business that loves our brands. It's our brands, and in particular Salter and Beldray, that has driven growth over the past 10 years, and ultimately, it's our brands that are going to drive long-term shareholder value.

However, that clearance division has hampered the growth of our brands. We always saw it as a nice little extra, a little sort of like bit of icing on the cake, which was the original core of the business.

However, over the last couple of years, we've sort of seen how that has confused our customer in terms of what UP stands for and what our product and brand offering is, and has also proved to be a distraction to our commercial teams, especially in relation to our sales team. Therefore, we took that very difficult decision to close down the clearance division, which saw £6.5 million coming off that revenue line.

Obviously, that flowed down to to gross profit. Then in terms of admin expenses, those are up by £500,000 in total.

£400,000 of that relates to the reorganization that we've done in the period of our commercial function, particularly our sales teams. That's the top line.

Moving on to slide 15, I think some of you know that we've probably got one of the longest revenue notes in the business, that we do try to explain everything fully and in detail for everybody, and I know that an awful lot of you love to kind of like get down into this and sort of like try and work out what's what's occurring. How I would summarize it is in sort of like three ways.

You can see that 69% fall in that third-party clearance business, that £6.5 million, and then our branded sales are up by 2%. However, that growth has really all been generated by one segment, which is the EU discounter segment.

Now, two or three years ago, we set out a vision about how we were going to grow this business over the medium term, and that had three planks to it. The first was growth in relation to Europe, and you can see that we've achieved that in that EU discounter sector, that growth of branded sales of 91%, which shows what we can do where we align our strategy with our customers' strategy.

Second part of that was to continue to use RPA and other operational efficiencies to contain opex. I believe that we've been very successful doing that, with flat opex for around four years.

The third part was keeping our core stable, our core business almost being everything else excluding the EU discounters. However, disappointingly, you can see that we've gone backwards in the period.

Overall the UK down by 6%: 4% with supermarkets, 8% with discounters, 7% online. It's these numbers that made us go back and reflect that perhaps our go-to-market in the in the UK wasn't quite correct, that we were not aligning ourselves with what our consumers wanted and what our retail customers wanted.

That's why Andy went about sort of like changing the way that commercial functions worked. Part of that was the the promotion of of Duncan to be the the new CCO, and also part of that has been that refresh of that sales team so we can align more closely with our retail customers.

That summary of the sales movement can then be seen on the bridge chart on slide 16: so £6.5 million down in relation to to clearance, international branded sales up by £4.4 million, UK down by £2.9 million. In terms of how that has translated through to profitability, we can see that on the slide on page 17.

Obviously, turnover down. However, I'd have actually expected us to see an improvement in gross margin in the period because we have seen a benefit in relation to to freight.

Freight costs were very high following the closure of the Red Sea, but did kind of like come down following from that, and we actually saw a benefit of £1.2 million. However, that's been eaten up by a change in sales mix.

That sales mix is partially due to clearance being at the the higher end of our gross margin range, but it's also down to the EU discounters being at the the lower end of that range. This is why for us, we would like that increase in EU discounter revenue to be incremental, because we need to sort of like maintain that core, and that comes back again to why we have needed to refresh our commercial function.

That can be seen flowing through that change in the commercial function with the the £0.4 million in relation to to reorganization. Apart from that, we've seen a relatively stable opex line, but you can see that, we do need to have pay increases.

We're in an inflationary environment, we do need to pay people more, but that has been offset by the efficiencies that we've gained through using AI, through the use of the PIM, and through using RPA. Looking down to the the bottom end of the the P&L, on slide 18, there's probably just a couple of exceptionals that I want to pull out.

The first in relation to the move to AIM. On the 12th of January, we moved from main market to to the AIM market.

That's mainly because we see AIM as being the most suitable market for a company of our size. It's almost the natural home for, a a smaller, mid-sized company rather than being on the on the main market.

The other big cost is in relation to our ERP system. This is our main IT system that we use as a business, which is being end-of-lifed.

Therefore, at the moment, we've got a £2 million project going on, which will see us introducing a new ERP system, which will be launched in spring of 2027, you will see over the next 18 months those exceptionals continue to run through our income statement. Moving on to slide 19.

Just to kind of like reiterate what our capital allocation policy is. As a wholesaler, we have a working capital requirement, we need to bring stock in, and we think the most suitable way to finance that is through bank debt.

Therefore, we try and keep that net bank debt at around one times EBITDA. That's the most important part of it.

We then pay out 50% of our profits as dividends to shareholders. Then to the extent that net debt falls below that one times, we would then top that up with share buybacks.

Now, at the end of the period, we were below that one times, but over an average over the year we were slightly above that, we have not started to do share buybacks based on the year-end or, sorry, the interim-end position. That fall in net debt and working capital can be seen on slide 20, with net debt falling from £17.7 million to £9.7 million, with working capital falling from £32.5 million down to £24.9 million.

This is quite a a big point for us, that our capital allocation policy is designed in many respects to be countercyclical, because what happens with our business is when it shrinks, we end up throwing off cash and having excess cash, which can be seen on slide 21. There you can see as the business has shrunk slightly, we have thrown off excess cash, which has caused net debt to go down and dip below that sort of like one times EBITDA.

Sitting here as the CFO, that's lovely that my net debt has decreased, but to be honest, I would much prefer the business to be growing and for the business to have a a need for more working capital within within our business. Therefore, over the long term, I would be expecting the business to be consuming working capital slightly, rather than what we have seen within the period.

Andy, over to you for the summary and outlook.

Thanks, Chris. The summary is pretty straightforward.

We're trading in line, as the guidance says. Group sales are expected to be marginally ahead of market expectations, with profitability in line with consensus.

I guess at this point it's probably a good moment to talk about Iran. I guess the question around this war is is it going to be a long war or a short war, and your guess is as good as mine.

If it does prove to be a long war, what are we worried about? Let's start with what I'd be less worried about.

I'm not as worried about shipping. I'm getting a lot of incoming questions on shipping and the impact on shipping of this.

Our shipping routes have been going around Africa for quite some time, a long way away from the conflict zone. The increase in the oil price may have an increase on shipping costs, but only if it leads to capacity coming out of the market.

We have seen a sort of $400 fuel surcharge added on to a 40-foot container, but in terms of the overall rate, it's only if it leads to, say for example, older ships, which are now not economical, being retired, that you'd see a significant movement in the shipping rates. That is against a background of quite an excess of shipping capacity with quite a lot of new space that's come on stream in the last 18 months or so.

Might see some modest inflation in shipping, but it's within a normalized range. Factory gate, I'm more concerned about.

Oil prices feed through very directly into plastic prices, and plastic is a key input into many of our products. We'll need to watch that very carefully.

Some inflation in aluminum costs, which is a key input to our cookware. Again, I didn't realize, but there's quite a lot of aluminum smelting that takes place in the Gulf, you learn something every day.

Factory gate prices would be of a greater concern to me than, say for example, shipping. Probably my greatest concern revolves around demand and the reaction of the consumer, who's already quite traumatized about the cost of living crisis and is very sensitive to any talk around further inflation.

We've seen a consumer quite uncharacteristically saving over the last couple of years in response to those concerns, which is very unusual for a UK consumer. We've seen the household savings rate being sort of north of 10% for best part of a couple of years.

My bigger concern would be what happens with demand as consumers batten down the hatches again perhaps. Even there, I am optimistic because I do see quite a lot of distress in my sector.

We are a well-performing business with a strong balance sheet that continues to be profitable month in, month out. That's not the case for a lot of people around us.

If a tough market got tougher again, yeah, it would give me more gray hairs, no question, and I've got quite a few of those, but I suspect in the medium term it would also produce opportunity. Hannah, that's everything from us.

Are there any questions?

We have a number. Let's start with online.

Obviously, is slippage a worry, and are you concerned that you are losing ground to the competition? Have you got views on a strategy refresh?

The the decline in online can be sort of really I do have to be quite careful about talking about individual retailers for for commercial reasons, but we we have seen what seems to be sort of of sort of an extended destocking periods with with with with with Amazon off off the back of, I think, sort of fairly fairly boomish buying in in that kind of COVID post-COVID period. It's gone on a lot longer than I anticipated, but at some point it will come to an end.

We have seen some in in H in, in sort of the in the calendar year 2026, we have seen some better performances month on in in each month than than we did during calendar year 2025. There are some decent signs that that that kind of destocking process is is coming to an end, and and and we we can return to sort of positive positive like-for-like growth on online.

Also, we're very pleased with performance of our own website, salter.com and beldray.com. Yes, there are other platforms that we are on and we will continue to use them, but those we own and we own the relationship with the consumer at that point, we see those as a really important place for us to be to grow, and we will continue to be putting quite a bit of our resource online into growing our own platforms.

Sounds good. Thank you.

Can you provide a bit more detail around the reorganization of your sales team and how it might impact the future growth of your proprietary brands?

I think it has been a period of change, and change can be disruptive. I do feel that the much larger part of that is now well behind us.

We've done a lot in a very short period. Going forward, I think it's going to be sort of clearer, calmer waters, and we'll be able to sort of double down on the investments in the team.

I do think, repeating a little bit what I said before, that we're in a good position, I feel, relative to where we were, but we've got the opportunity to develop and grow from here.

Perhaps then nicely leading on from that, if the team's in a good place, what's the minimum viable external environment to have a high-growth future?

Ooh, what does that mean?

In high-growth If I was to project, I think they're asking if you feel like you've done what you can do internally, I know it's iterative, but what are we looking for externally to then

Look. Obviously the phrase "high growth" is in the eye of the beholder, isn't it?

What does high growth look like? I would say that we should be, through winning of market share in our UK market, should be growing at mid-single digits, and in our European markets, which are obviously much newer to us, we should be growing at sort of double-digit to mid-teen double-digit growth.

That should be eminently doable from where we are.

It does come down to that market share point of going, excluding Salter scales, we are challenger brands, and we've got a long way to go in relation to both of them. Both of our major brands.

Okay. Let's move on.

Of the £21 million sales to European discounters, how much was to the largest customer in that segment?

Can't really answer that for sort of commercial reasons, to be honest with you. What I would say is that as a board, we are concerned about customer concentration, and therefore, we have a limit that any single customer would not be greater than 20% of our total gross margin, and that's how we manage that.

If you do have a customer which is growing very fast, and I know which customer you're referring to and we are growing very rapidly with them, what we need to ensure is that the rest of the business is back to growth as well to make sure we don't breach that 20% limit.

Okay. Maybe not a nice problem to have, but glad to see that they're growing aggressively with that one.

I've noticed several new Salter products that appear to be dupes, e.g. a KitchenAid stand mixer or a Smeg kettle toaster.

Is this an evolving strategy?

I guess, again, that's another one that's in the eyes of the beholder, isn't it? We certainly don't set out to dupe sort of other brands, and if we did, we'd be in an awful lot of trouble with them, and we don't have issues of that type in our business anymore.

We did many years ago, but not anymore. I think sometimes when you've got products which have a particular function, then inevitably some similarity can happen, but no, we want Salter products to be Salter products, not a dupe of another brand.

Okay. Probably a couple of questions here, which are sort of getting at the same thing.

One saying, "When will you have completely exited the 3P clearance and white label business?" The other one sort of, "What proportion is from long-term strategic plans rather than opportunistic listings?"

An opportunity to talk there about the focus on brands, I think.

Yeah. I think we've got about half a million of closeout stock still in the business to move through, but I suspect that'll be largely through by the end of this calendar year.

I think it's probably not a bad moment to share my thoughts on where we need to be in the longer term with regard to our brands. General merchandise has typically been sold season to season to retail buyers.

I do think we need to evolve our business to be more about category management. We do need to, I think, start thinking like an FMCG, because that's what they do.

It would be unusual for our segments, but I think it's where we've got to be. It's one of the reasons, for example, why we still have some recruitment to do into our sales function.

I'm really keen to bring in some account managers from an FMCG background, because I do think it's the direction we need to head into. It's been super useful having J.C.

and Andrew Milne on our board. J.C.

is ex-Procter & Gamble. Andrew Milne is ex-Coke, and obviously, is CEO of Nichols.

They have really helped get us thinking about this, about how we sell and how we partner with retailers. It's not our natural skill set, we are going to have to either learn or bring in expertise in, but we really do need to be in the future in a position where we're category managing right and kind of managing space, I suppose, rather than what we've perhaps come from, which is about pitching products and ranges on a season-to-season basis.

Thank you. Just a comment here on exceptional ERP costs.

Will you be classifying the benefits of the new ERP system as exceptional and adjust them out from 2027 onwards?

Ooh. Someone's

got a sense of humor.

I know. Yeah.

That's a sort of difficult one. Yes.

Ooh. The answer's no.

The answer's no, but I'm going, is it sort of cuz I'm going, we will be able to sort of quantify, because we will start sort of looking, because what we've done with the PIM is that we've used that to kind of produce benefits for the business. The question is right in going, is that I absolutely think that that will start producing benefits, whereas lots of people may be sat there with their ERP system going, "All right, it's just the cost, it's the cost of the ongoing business."

We've seen with the PIM how our people have taken that and how they are using that, and so at the moment, we've got sort of a couple of our guys going over to the US because we're up for an award in relation to our use of the PIM, because what we do is we take these systems and we make them work for our business to help us operationally, and we're going to do that with ERP. Most people are going, "Well, there won't be any benefits."

I absolutely believe that there will be. A lot of pain to go through whilst we go through it, but

Just to add to that answer to the somewhat mischievous question. The reality is that these costs should have been capitalized, in my opinion, but accounting standards have changed since my day, and hence they happen to be revenue expensed and therefore treated as an exceptional.

I'm not sure if this question came in after your shipping comment, but they are saying the CEO of Maersk expects 15% to 20% increase in shipping costs. What impact do you think it'll have on gross margin and working capital?

I suppose in relation to that is going where we are at the moment. Base costs at the moment are 2,000 for a 40-foot.

To put that in context, at the peak of the shipping crisis, that went up to 18,000. At the moment, they're putting on a surcharge, which is about 400, which is a 20% surcharge, within that sort of 10% to 15%.

That's only putting you at 2,400. That compares to 2,800 that we were paying last year, and the year before that were paying about 6,000.

That 10% to 15% is absolutely in a sort of normalized range.

Okay. Thank you.

Let's have a look. With engineering and production outsourced, how long would it take competitors to follow such sales insight or clone your best product?

I think it's very easy for people to copy products and to do it very quickly. It's one of the reasons why we evolved our business model away from a trading and sourcing model, because all you have is speed.

This is why we focus on our brands. We made that decision back in 2013.

China over many years has come closer to the UK in various forms, not least recently with the likes of Temu, but before that with things like Alibaba. Also the West has got closer to China.

Many retailers have sort of Far East buying offices and whatever, which is why we moved to being more branded. The reason for that is when it comes to general merchandise, the market research is very, very, very clear.

Consumers want a brand. They don't want white label or own label or product.

They want that confidence. I think that is escalating as awareness of issues around product that's been bought off platforms like Temu have become more common knowledge.

I was talking to an ITV journalist who was really interested in this kind of point, and they said at the end of the conversation, the reason why we're talking to you is because, you know the way on sort of, say Good Morning Britain or whatever, they have an email address, and they said everyone thinks if they email, we won't read it. They said, "Well, we do.

We read the emails, and we're getting a lot of emails about substandard and dangerous product that's been acquired through these kind of platforms." I actually think this consumer prioritization of brands when it comes to general merchandise is not only going to continue, but it's going to escalate.

That's going to be overlaid, by the way, with regulatory change. The product safety and metrology bill that came in last year is going to lead to a raft of additional legislation, which is basically going to be about online platforms the likes of Amazon, say, Temu, etcetera, being as responsible for the product they sell as, say, Tesco is, a sort of leveling of the field.

I think it's going to be tougher for those platforms as we move forward, and I think the need to rely on brands is going to increase.

Okay. Nice segue then: strengthening brand presence, strong refresh, lovely endorsements from the likes of Which?.

Do you think any of this leads to distribution of these ranges into higher-end retailers and independent cookware?

We're beautiful products for every home, we're proud to be mass market. I did used to say, "If you see us in John Lewis, let me know, because we've done something wrong," and then we bought Salter, and the Salter scales were in John Lewis, I can't say that anymore.

I think there is some scope for moving into some of that retail space. We're doing, for example, increasingly well with Currys, and I think that's a really credible place for an electrical brand to be in.

We have no desire to be a high-end brand. I'm going to get a big sort of Citizen Smith here, selling stuff to people who already have lots of stuff does not particularly interest us as a concept.

We want, in a very small way, to make the lives of ordinary people a little bit better. That's what we want to do.

According to this commentator, there's also two Beldray SKUs in John Lewis, you're infiltrating in there, Andy.

I know. Don't know how I feel about that.

You cleverly got round the earlier question around concentration of customer in Europe. What about geography, Chris, perhaps?

Can you roll out successfully to other countries? Where are you concentrated at the moment?

What's the opportunity there?

We believe that we have an opportunity globally. There are kitchens all around the world, ultimately, we have global ambition.

You have to do that step-by-step. Is securing our UK core market, which for us is the most important and we want to do first.

Then we're going to be building on where we are already strong in Europe, which at the moment is in Germany, France, and the Netherlands, and that's where we will start, and then as we can see incremental customers that we will work with, that's the way we're going to go. Until we've secured that UK, we aren't going to start sort of flying off and opening offices in the US or anything like that, but we know that in the very long term, of course, we can sell to all 1.5 billion kitchens that there are across the world.

Okay. Considering your European ambitions, what percentage of your sales people are native speakers of the foreign language?

At the moment, one. At the moment, one.

I think that when we sort of pivot, it's a great question because we do have to work that one out. How do we serve Western Europe?

Is it by recruiting native speakers locally? Is it by serving accounts because don't forget we're targeting very large accounts is it by targeting those very large accounts from the UK?

Is it a mix of the two? That remains a bit of an open question, because there are lots of examples of both.

I always look to the Dutch. They have that kind of wholesaler, trading tradition that actually predates the British tradition, and they seem to serve Europe pretty effectively, largely speaking in English.

Then they do at the same time largely supplement that with some local presence often. I suspect it'll be a hybrid of the two as to how we serve those regions.

Okay. This one probably speaks to the value you might see in your shares at the moment.

Obviously, management incentive plans have lapsed, etcetera, and the EBT currently holds over half a million of shares plus option requirements. Why do you continue to purchase significantly into this additional fund?

Because we sort of take a long-term view in relation to it, with the EBT, it's little and often. You do always tend to have more plans being issued each year.

Yes, if there were sort of no new share options being issued ever, then we may have an issue, but almost what you're doing is looking at over sort of four- or five-year period, and seeing the general inflows and outflows, but yes, technically at this moment in time, there's a little bit too many, but I'm just going to continue to buy through, because in some years what's ended up happening is more share options have been issued and more have been exercised than I bought in the market. It ends up over a long period of time equaling itself out.

Okay. Thank you.

Right, well, I'm conscious of the time. I hope we've got to the gist of the most people's questions, even if we haven't asked them individually.

That just leaves me to say thank you for your time, everyone. When I switch off, there will be a survey.

We're going to do it straight after the event today, please fill it in. Otherwise, thank you all for attending, and thank you both for your time, and good luck for the next six months.

Our pleasure. Thanks, everyone.

That's great. Thanks.

Thank you.

Thank you. Thanks.