Thank you. Good morning, everyone.

I'm George Adams, Chair of Synlait, and it's my pleasure to welcome you to our FY 26 full-year results conference call. Joining me on the call is our Acting CEO, Leon Fung, and our CFO, Andy Liu.

They will take you through the results in detail shortly. First, I want to acknowledge that financially this has been another difficult year for Synlait, and I appreciate that for our shareholders, that is challenging news to hear.

However, we have delivered a major operational recovery in the second half. Just like the repairs to the company's liquidity, milk supply, and balance sheet over previous years, this is critical to our future.

Synlait is now stronger and more focused than before and well positioned to progress for recovery. That is real progress, and I want to thank Synlait's team for delivering that, including Hendrick and Ruben, who you can see on the front of our investor presentation and annual report.

There have been many long hours worked, and the board and I are grateful for that. I'll now hand you over to Leon and Andy, and there will be Q&A after the presentation.

Thank you. Leon.

Thank you, George. Good morning, everyone.

Thank you for joining us for Synlait's full-year 2026 results call. FY 26 was a difficult year financially.

It was also a year of real progress in our recovery. In the second half, operations stabilized, and this resulted in a strong improvement in financial performance.

Today, Andy and I will cover the progress, the work still ahead, and how we will work to ensure Synlait's recovery continues. We will start by looking at our first-half performance, as this is what has driven the overall result for FY 26.

The half-year result was impacted by three main issues: manufacturing plant adjustments, lower ingredients returns, and deferred tax assets. The financial impact was significant.

We posted a first-half EBITDA loss of $34.7 million and an overall net loss after tax of $80.6 million. Synlait responded with a clear recovery roadmap.

It has three interconnected horizons: stabilize the business by fixing the fundamentals, simplify by focusing on Dunsandel, and finally, scale, creating a strategy to drive future growth. I'm pleased to say we have made real progress on the first two horizons, stabilize and simplify.

This slide shows some of the work we have done. This is the deep work that has involved resetting the fundamentals across four areas: operations and assets, quality, people, and revenue.

In operations, we strengthened frontline leadership, we are investing in our assets, have improved production planning, and completed major projects to support long-term stability. In quality, we strengthened protocols and processes to align with new regulatory expectations in the key markets, including China.

We also introduced the new product checks and improvements and embedded a company-wide food safety culture. For people, we developed our frontline and senior leaders, uplifted engagement, drove a new performance framework, and launched a new health, safety, and well-being strategy.

We reset our revenue function with a strengthened business development team, broadened our infant formula customer base, progressed adult nutrition opportunities, and tightened pricing discipline. Together, these actions have built a strong foundation for recovery.

Our key achievement for the year has been operational recovery. Manufactured in-spec improved from 88% in FY 25 to 93% in FY 26.

Production plan attainment rose year-on-year from nearly 92% to 95.5%. That is a huge achievement, thanks to our frontline teams.

I'm pleased to say that manufactured in-spec was 99% for August. We are focused on delivering that consistently to reach that level of operational excellence we are aiming for.

You can see on slide 5 that operational improvement translated into a much stronger second-half financial performance. Reported EBITDA improved by $77.5 million, underlying EBITDA improved by $38.1 million, reported net profit after tax improved by $85.8 million, and underlying net profit after tax improved by $33 million.

These results show the benefit of a more stable business. However, the full-year result reflects the difficult first half.

My final slide for you shows the overall results. The total group revenue for the year has increased to $1.93 billion, reported group EBITDA was $8.1 million, underlying group EBITDA was $46.3 million.

We have reported a net loss after tax of $75.4 million, with an underlying net loss after tax of $21.6 million. Net debt reduced by 14% to $250 million.

Operating cash flow was negative $183.3 million. This reflects weaker operating performance and the higher working capital needs.

The good news is for our farmers. Synlait is confirming its second-highest milk price in our history at $10.07 per kilo of milk solids.

This includes the incentives we pay our farmers above the base milk price. I will now hand over to Andy.

Good morning, everyone. Thanks for joining us.

I will begin with the main drivers of FY 26 result, followed with business unit performance, the North Island discontinued operations, cash flow, and net debt. Move to page 8, let me start with the main drivers.

Improved second-half operations kept Synlait's recovery on track, although the full-year results still reflected significant first-half impacts. The main point on the bridge is that volume were not the issue.

Consumer and foodservice growth contributed $2.3 million into bottom line, but that benefit was more than offset by price, mix, and cost. Price and mix reduced NPAT by $7.3 million, reflecting higher portion of relatively lower margin products in advanced nutrition and an unfavorable ingredients product mix, partly offset by stronger foodservice and butter price.

Costs were the biggest challenge, reducing NPAT by $39.8 million. Operational disruption reduced fixed cost recovery and increased manufacturing, quality, and milk transport costs.

Milk premiums also increased the costs. These impacts moderated in the second half.

Other margin and income were mainly affected by unrealized foreign exchange losses at year-end. This was partly offset by Abbott TSA income.

SG&A provided a $1.6 million benefit. This come from closing Palmerston North's office, leaning our leadership and commercial structure, and the tighter spending controls.

We achieved these savings despite inflation and oil-related cost pressures. At the same time, we continued to invest in our people, systems, and core capabilities.

Financing was a clear benefit. Despite negative operating cash flow, financing costs improved by $22.2 million.

This reflected improved banking pricing, better base rates, debt reduction follow the North Island sale, and more cost-effective CNH funding. After adjusting for one-off items, underlying NPAT was a $21.6 million loss in FY 26.

Go to page 9, I will show how these drivers came through across business units. The portfolio result was mixed.

Consumer and foodservice delivered growth and stronger margins, while advanced nutrition and ingredients were affected by operation disruption, capacity constraints, and weaker stream returns. Advanced nutrition revenue was broadly flat, but gross profit declined 78%.

The key issue was manufacturing efficiency with operational disruption, product plan changes, and increased cost from production catch-up. Lower lactoferrin sales also reduced the contribution.

Ingredients revenue declined 15%, with gross profit down 26%. Lower volumes and constrained product mix forced us to produce more whole milk powder and sold into lower price markets in the first half.

The mix improved later in the year, especially through skim milk powder and AMF. Consumer revenue increased 32%, with gross profit at $51.7 million.

This reflected growth across export and private label channels, good butter price achievement, improved manufacturing recovery, and inventory management. Foodservice revenue increased 62%, with gross profit improving by $15.6 million to $11 million, the first full year of positive gross profit.

This was driven by 43% volume growth, improved pricing, lower fat costs, new China contracts, and expansion across Southeast Asia. Other revenue increased 32%, reflected tactical milk sales in order to manage surplus milk volumes and manufacturing capacity constraints.

Next page, page 10. This page separates the North Island discontinued operations from the continuing business.

The North Island sale is complete, making Synlait simpler and more efficient. The table shows the continuing business we are taking forward, the North Island results, including the gain on sale.

Without the gain and related tax benefit, the North Island operations was still in loss-making in FY 26. Continuing operations generated $1.68 billion of revenue and underlying EBITDA of $46.3 million.

This is a relevant baseline for assessing future performance. Now we have a clearer operating base, with our focus and investment centered on Dunsandel and Dairyworks.

Page 11, it shows how operating performance translated into cash flow and net debt. Cash remains the biggest financial challenge in FY 26.

Operating cash flow was negative, reflecting weaker operating performance and significant working capital build, which was mainly affected by higher receivables and inventory. Against that, the North Island sale generated roughly $296 million of cash proceeds and materially strengthened the balance sheet.

After operating cash outflows, capital investment, interest, and other movements, net debt finished the year at $250 million. In summary, the second half showed clear improvements in operating stability and financial performance.

The next step is to translate that progress into stronger margins and cash generation, which continuing to reduce debt through disciplined execution and capital allocation. I will now hand back to Leon for the business update.

Thank you, Andy. I will now cover off the performance and the priorities of our business units: Advanced Nutrition, Ingredients, Foodservice, Consumer, and Milk Supply.

Advanced Nutrition makes high-value products for early life and adult nutrition. In FY 26, we secured purchase orders from a new Middle East infant nutrition customer for commercial supply commencing in 2027.

This is a significant win for the team as we seek to onboard new customers, and we are confident this partnership will scale up quickly. I'm pleased to report we have a pipeline of customers keen to work with Synlait.

This means we are confident we will build the capacity created by The a2 Milk Company moving its English label production. We have also commercialized NutraBase, creating a platform for adult nutrition products and multiple private label opportunities in Southeast Asia.

We also strengthened our dedicated business development function, a structured opportunity pipeline, and the project Lotus. These projects focus on specialty nutrition using high-value ingredients, including lactoferrin.

Looking ahead, our priorities are to grow the Middle East contract, onboard new customers from Southeast Asia, expand higher value consumer-ready solutions, commercialize specialty supplements, and reduce exposed to any one customer or market. Our ingredients portfolio includes milk powders, milk fats, specialty ingredients for global customers.

During FY 26, we focused strongly on value over volume. This include tighter pricing decisions, customer profitability modeling, and stronger sales controls.

We advanced diversification across Southeast Asia and the Middle East, simplified product specifications, and strengthened sales-facing hedging and risk management. With manufacturing stability materially improved, our future focus is to extract greater value from available milk.

That means disciplined pricing, stronger product mix, greater use of our infant formula grade capability, customer-led technical solutions, and growth in higher value applications. Foodservice delivered its first materially profitable year, supported by 43% volume growth, improved pricing, and wider geographic reach.

We expanded across Southeast Asia, strengthened our Shanghai presence, and launched Synlait-branded UHT whipping cream in China. A new customer-owned brand partnership broadened our routes to market, while changes to the sales and marketing team strengthened distributor and end-user management.

We will now grow volume and market share while protecting returns. We will expand through our distributor network, build on our China launch, and use Synlait product quality, grass-fed certification, and New Zealand origin to stand out.

Our Consumer business delivered strong growth through Dairyworks and its portfolio of brands. More than 5,000 additional metric tons of cheese was shipped to Australia compared with FY 25.

Dairyworks brands delivered 11% volume growth and 17% value growth in the latest annual total. Value-added, grated, sliced, and snacking formats generated more than 55% of Dairyworks growth.

Innovation remained important. Dairyworks Protein, launched in June, contributed 50% of natural cheese snacking segment growth.

Talbot Forest brand continued to grow strongly, and Costco sales increased 133% year-on-year. Our focus on project Hedgehog is to improve plant efficiency, further growth in Australia and Southeast Asia, new product development, and supply chain optimization.

Strong farmer relationships remain fundamental to Synlait's success. We have almost 200 farmer suppliers.

As mentioned earlier, we are confirming the second-highest milk price in Synlait's history today, $10.07 per kg of milk solid, including incentives for the 25 to 26 season. During FY 26, we introduced a new customer-funded sustainability incentive of $0.02 per kg of milk solid.

This is focused on reducing greenhouse gas emissions and expected to double in the future. We also delivered a new tool to provide real-time tanker arrival information, and our biodiversity program have now distributed more than 385,000 native trees across Canterbury.

Our future focus is to grow customer sustainability partnership, improve the digital offer, and continue our market-leading on-farm support. We look to the future now and explain how we will maintain the momentum we achieved in the second half.

We are continuing to focus on our recovery roadmap. In operations, we have created a production plan to make the most of every drop of our farmers' milk.

We will retain our focus on stability, strengthening our assets, and deepen our talent pool. In quality, we are recruiting the Chief Quality Officer, continuing to reduce cost of quality, and progressing asset investment to maintain access to the key markets and reduce regulatory risk.

For our people, we will continue leadership development, target critical capability, refresh onboarding, embed Synlait-safe mindsets, and critical control assurance. We are focused on diversifying our revenue streams while aligning the product portfolio with plant capability, milk supply, and returns.

As mentioned earlier, we also delivered a strategy to scale of our success and share with you in 2027. We remain clear about the risks ahead and have active plans in place to manage them.

Operational excellence: we will keep our focus on our plants and maximize returns from our Dunsandel assets. Leadership and strategy: we have a strong executive team at Dunsandel, and we will maintain that.

We will finalize CEO and Chief Quality Officer appointments and deliver a reset strategy in 2027. a2 volume shift: we have a new business pipeline, which means we are confident of backfilling this volume.

Contracted commitment from our new Middle East customer have the opportunity to scale up quickly. Revenue: as well as addressing our concentrated revenue stream, we're focused on protecting margins and ensuring all commercial arrangements add value for Synlait.

Refinancing: we will continue working with our banking syndicate after showing them we can manage through challenging years like this one. Bright Dairy's support is very helpful, along with their renewal of shareholder loan, which now matures in 2028.

China market registration: we have an experienced cross-functional team working to renew the approvals required to continue manufacturing infant formula for China, and we are confident of success. We are also well equipped to deal with changing quality and regulatory requirements, managing stakeholder confidence, and continuing to show leadership in on-farm sustainability.

Synlait is still in a recovery phase, and TY 26 is a five-month transitional period that will be influenced by the timing of production, sales, working capital movements, and other seasonal factors. Given the short and noncomparable nature of this transitional period, Synlait is not providing guidance for the five months ending 31st of December 2026.

You only have to look across Synlait's financial performance over the past 11 years to see the company was most profitable before it expanded to North Island. Profitability peaked in FY 19 with a net profit after tax of just over $82 million.

The North Island assets created a drag on Synlait's performance and now they're sold. The company is stronger, simpler, and well positioned for the future.

The graph identified a period of underperformance, and the way we are making sure we learn from the past. Our executive have taken a holistic view and identified issues that has caused Synlait to underperform, not just in FY 26, but back to FY 20.

An oversupply of manufacturing capacity, the impact of COVID, and the subsequent decline in China's birth rate impacted every year until FY 26. Operational stability issue impacted performance in FY 25 and FY 26.

We have worked to address these issues. The capacity issue is resolved following the sale of our North Island assets.

Our new revenue strategy will ensure Synlait is no longer exposed to a single customer, market, or product again, which help to protect us from future shocks. As we have achieved operational stability, our goal is to return the company to its earlier successes.

We are confident we will do that given the pipeline of customers we are working with, and the capacity and capability of Synlait's asset and its people. The key message from me from today: Synlait has made meaningful progress in stabilizing and simplifying the business.

Second-half performance improved substantially across EBITDA and net profit after tax measures. Operational recovery has been achieved, and we are on track to deliver continuous operational excellence.

The North Island sale simplified the business and strengthened our balance sheet. We have started addressing our next biggest challenge, diversifying revenue.

This is an opportunity we are excited about. It will strengthen Synlait for the future.

A reminder, we will deliver full strategy to scale at our success in 2027. My final remark is to assure you all that Synlait is well placed to progress our recovery.

Thank you.

Hey guys, can you hear me?

Yep.

Yeah. That's good.

Just in terms of the kind of outlook, and I know you're not wanting to provide guidance in this half period, but do you think that the run rate on an underlying basis achieved in the second half is a sustainable basis for the business?

Yes, thank you, Mark, for your question. Yes, we are confident to see we will continue the improvement in the second half.

We will continuously making effort to maintain that success, and which will enable us for scale up in the near future.

In terms of the slide that you put on about the sort of pre-North Island earnings, are you saying that that kind of earnings figure is achievable in the future with just the North Island as it set up today and sort of evolved customer and product mix? Or is it purely very illustrative?

The slide actually show some historical data when Synlait was very successful before the North Island asset established. Of course it's not the only reason.

There are other challenges alongside. We summarized that the birth rate declining in China also contribute against our initial plan.

The key message here is that we have a very solid plan to move forward to get success again in the near future.

If I could just add, clearly it's not indicative of a number in future. However, I would just add that it was also fairly clear that Pokeno was a significant drag on the business, and that drag has been eliminated.

Good morning. Can you hear me?

We can.

Yeah.

Great. Thanks guys.

Look, just thanks for the update. On the milk supply, apologies if a few difficulties at the top of the call if you already answered this, let me know.

Can you just give us an update on Synlait's degree of success in its efforts to retain its farmer suppliers? Because we have various anecdotes that some were still going to competitors, just any sort of more detailed updates to provide on that would be appreciated.

Thank you.

Thank you, Steve. In term of the milk supply, we have the right amount of milk for our plant, for our factories, all right?

That is the first thing I want to highlight. I talked to our farmers, many of them, and I can see that our farm suppliers, they are very keen to see Synlait to be successful again.

I really appreciate their support. I don't see in the near future that we have challenges on the milk supply.

All what we need to do is to deliver the performance to our stakeholders, to our shareholders, and to our farm suppliers, and we can continuously bring the value back to them.

Okay. If we look at production volume in the year just gone, it was down 6%.

Should we be expecting volumes to stabilize in FY 27 and FY 28 or should we expect further decreases? I'm just trying to understand what the right level of supply is.

It sounds like you are expecting some of your farmer suppliers to go to other brands, but that's part of the plan. Just help us understand.

Maybe with a few numbers would be helpful. Thanks.

We actually have a very good start of the season. We are expecting 3% to 6% more than budget.

As I highlight earlier, we have the right amount of milk for our plant. We just want to get the right product mix in order to get the value of the available milk.

If I could just maybe also add to that, maybe Andy can give us some detail, but one of the reasons we had a decline in production last year was actually not with a shortage of milk, but we actually had to sell milk at peak because we were unable to process it due to manufacturing challenges. There's an artificial drop in the volume, as opposed to us actually not having the milk supply.

I think George just covered what I want to say, but also just a reminders that for these outlooks for the new season's volume that we should also take into account that for the Pokeno site, we don't have it. Which means definitely for Advanced Nutrition, we have some kind of reduction, which is we already expected early enough.

That's helpful. Maybe just just on the same topic, you've you're currently paying a premium, I think, $0.38 a K- a kg of milk solids.

At at some point if you're in the right supply got the right amount of supply, would one would presume that might come off a little bit? Or or, are you sort of comfortable with a $0.38 per kg premium?

Do you think over time that should come down? The reason I'm asking is if I think of a medium-term profitability Synlait obviously for that to come down a bit to maybe where it was in the past would be helpful to profitability and some of your targets there.

Any comments on, that premium, how long that might stay at that kind of level or or perhaps does it need to go up in the near term, or do you see it potentially coming down, at some point in the future?"

We review our milk price strategy every year, like everyone does. What I want to say is that Synlait came from very deeply on the farming background.

That is part of our DNA. We want to bring the value back to our farmers.

Good examples are Lead With Pride, which is very well welcomed and supported by our farmers. That bring the value.

That is part of the reason we can pay more incentives on top of the farmgate price. We also have customer-funded sustainability programs, which it's a part of our incentives, what we pay on top of the farmgate milk price.

We will continuously doing that. We do have global customers who are very interested working with Synlait, working with our farm suppliers on that.

Yes, we will maintain or looking at the more incentives to bring back more values to our farmers. Year-on-year, it will be some difference.

Okay. Second sort of line of questioning was on the Advanced Nutrition business.

Just a point of clarification on the statement you've made that you expect essentially this new Middle East customer and maybe some other customers to see recovery volumes that you're going to lose from a2 Milk internalizing English label in the season, which they've obviously stated publicly. Just wanted to clarify when you state that you're going to recover the volumes, first of all, are you referring to the FY 25 year, where I think it was 40 MTs, or are you referring to FY 26, which was 45 MTs?

What is baseline when you make that statement? Then second part of the question is, for this new Middle East customer, are you expecting the volume from that customer to be material over the next 6-12 months, or is it going to ramp up sort of back end of next year?

Some indication of time would be helpful with that new customer thinking.

All right, just to give you a little bit clarity, the new Middle East customer we are working with is quite a big player in the market. They are quite interested to work with us as a long-term partnership.

The volume we are looking at is significant. That's why we say that we have the confidence to backfill the gap that a2 Milk they moving away the English label from Dunsandel.

Also there are a list of customers we are working with. The team have been working on, and we are looking at onboard more customers to Synlait.

It's not only the infant formula, but also adult nutrition as well. Synlait strength is the nutritional product.

Once we are very good at infant formula, it's easier for us to get into adult nutrition, the other nutritional products as well. If we look at in a positive way that's why we say that we are excited about opportunity when a2 moved away some of this volume, especially the English label products to their Pokeno factory.

This create opportunity for us to be diversify rather than just exposed on one customer, one product, one market.

Can I just ask again, just in terms of that Middle East customer, take the point it's a potentially large customer, but do you have an idea, or perhaps how we should be thinking about the ramp up of those volumes?

Just to give you an example, the volume we are looking at is that representing 18% of our FY 27 capacity. That is quite significant.

Maybe just to add Yeah, just to add Stephen, that yeah, regarding that the ramp up, we assume about 3-year, roughly 3-year time, we can backfill.

Because for any nutritional customer, it does take a little bit time to ramp up the volume. Normally, it takes 2 to 3 years to get the big volume we are expecting.

No that's great. Good news.

Then just so just to be clear, then it's 3 years, call it, to get to 18% of capacity. That would be a rough idea in terms of the trajectory?

No, what I said that in 2027, we are expecting a big volume growth already.

Stephen, if I can clarify, what Leon mean is that for the next 12 months, it will be a 18% backfill the lost volumes or capacity. In 3 years' time, we can fully backfilled the capacity or the demand.

Got it. Thank you.

Then just this last one. I guess just in terms of the revised banking facility, which you announced in end of July, just in the near term before this new customer ramps up, right, and obviously you are still reliant on a2 volumes, and with English volumes coming off and their China label volumes are down a bit at the moment, just wanted to ask, are you confident that the company will remain compliant with its banking covenants over the next, call it, 12, 18 months?

In particular, you've got a 3-monthly EBITDA test, by the looks of it. Are you comfortable, given that near-term impact on production of demand from a2, that you can still be compliant with those covenants, or you likely to need waivers in the near term?

Regarding the ramp up together with this a2 English label, actually we already knew that early enough. All of this we already taken into account in our forecast and very openly shared with the banks.

That's why that we said for Synlait's business, the second half is really good to see the improvement of the operation stabilities and the improvement, which really makes the financial numbers can be more reliables. Now that we have also a very close follow up for all the bank covenants.

As of today, yeah we feel comfortable or confident we meet their compliant.

Nice. Just last one.

Given you've obviously got those detailed plans with the banks and you've shared it with them and they're comfortable and you're comfortable, did you give more consideration to providing guidance to the equity market? Because I guess if I sit back and look at your 5-month period that you're about to go into now, you've had 2 months of actuals roughly and you've only got a 3-month period to forecast.

Is it just this period you won't be giving guidance or is it generally in a product that you won't give guidance to the market particularly market for reporting periods going forward?

We actually haven't given guidance for some time, and I think that was on the basis of us generally struggling to get our hands around operations. I think we stopped giving guidance about 18 months ago.

What we'd like to do is to review our position on guidance at the end of this year. We'll get back to the markets and obviously yourselves probably early February with our view on that.

At this stage, that remains our position.

Cool. Thank you very much for your answers.

Good morning. Can you hear me?

Yeah.

Great. Just one point of clarification, Andy, you mentioned 18% of the capacity being filled with the new customer.

Can you give us some perspective on what is the reduction in volumes from the a2 internalization for this year? What is the level of capacity you're looking to replace?

I think from the a2's volume, it's more commercial sensitive, I don't think I can answer that. Maybe proposal you can find some other kind of export numbers that to find it.

What I can say that regarding that volumes, yes, that we try to fill backfill the 18%. Sorry, I can't answer that.

Maybe a different style of question on it then. Are you expecting to do any material English label volumes for a2 in the next 12 months?

This is the question to ask a2 actually, cuz they want to prioritize their Pokeno factory. For English label, we have the plan to not have their English label production in Dunsandel.

From time to time, they may still need our help. In fact, we are still doing some English label for them.

Good to know. In the underlying result, as you highlighted, the Advanced Nutrition EBITDA was low and particularly low on a per-ton basis.

You called out efficiencies, and you called out costs. How much of it is structural, how much additional cost are you needing to carry now, particularly around testing and quality, that will mean that the gross profit per ton is lower than what we've seen in the past?

Let me answer this question at a high level first and then I get Andy to tell you a little bit more details. The high cost or lower margin in last financial year is not representative.

Advanced Nutrition is a profitable business. It's just that when we have the instability of the operation and some challenges, the cost is going up very quickly.

That also came to our food safety, product quality mindset. When we see some challenges, when we see the potential risks, we take a cautious approach.

That cost us a lot. I want to say that what you see now in last financial year is not representative of its real picture should be.

We are confident after resetting the all the fundamentals, we'll be back to profitable business under nutritional business.

To build on that what Leon just mentioned, once that we have this operational stabilities and also, let's say, we have a better controlled for the quality everythings, definitely that we expected the margin will back to the more normal levels, which means previous the more standard years, yeah, normal years.

Okay. With additional costs the incremental testing that you have to do to meet the Chinese regulations, that's going to be passed on to customers?

Any extra cost will be discussed with our customer, because as you all realize that there's a regulatory change and quality standard change, especially for the China market. In the last few years, the testing cost, as example, does increase.

Okay. Then just finally, on debt and working capital, you obviously have a big increase in working capital.

Are you expecting any reduction or any of the issues that lifted the working capital to be temporary? I'm talking about large magnitudes here.

Marcus, it's a very good questions. Actually, for me and my teams, from now on, the focusing, the biggest one is cash generation.

Definitely that we expected the working capital should be improved from the both inventory management and also receivable side, yes.

Okay. Any magnitudes, Andy?

Can you give us any targets in terms of reductions in working capital over the course of the next 12 or 24 months?

Not for the moment. I can just to check it and to see what I can provide you maybe afterwards.

Okay. In the accounts, just following on from that, there is noted some EBITDA minimum milestones that need to be met for the bank facilities.

Are you able to give us any perspective on what they are?

No, sorry, I can't.

Okay. Thank you very much.

Thank you.

Hey, thanks. Sorry, seemed to cut off before.

Just in terms of the Middle Eastern customer, can you confirm whether that's a sort of bulk or base product versus a tin product, and how we should think about the margin profile I guess initially and as it ramps up versus what volumes you're giving away or losing to

a2? I can give you a high-level picture of that.

It is in the bulk, in the base powder. All right, this customer has their own brand.

They want to use New Zealand high-quality product, grass-fed product for their brands. Yes, this is a very promising business for us for the near future.

Any sort of indication of relative margins of a sort of bulk product like that versus the tin product you're doing for a2?

We do have a good margin on that, because that's a nutritional product, even though it's pack into 25 kg bags. The details I cannot share because commercially sensitive.

Okay. No, that's all.

Thanks. We'll chat later on.

Thank you.

Thank you. Thank you, everyone.

This concludes today's call, and I really appreciate your time and questions. If you have any further questions, please contact Jo Scott, who is the Head of Corporate Affairs and Engagement.

Thank you very much.

Thank you, all.

Thank you.