Scales Aktie

Good afternoon, ladies and gentlemen, and I'm Mike Petersen, Chair of Scales Corporation. And it's my pleasure to welcome you all to this annual meeting. Thanks for coming out today. I know it's a beautiful day outside, and you would probably rather be enjoying it in the sun. But we're thrilled to have you in attendance here, not only in person but online as well as through the virtual meeting today.

It's a 114th Annual Meeting of the company, the 12th since it became a listed company and my fourth as chair. Once again, we're holding a hybrid annual meeting and whether you are here in person or joining us online, I'd like to thank you and welcome you all.

As you may recall, shareholders, proxies and guests attending the meeting virtually, will be able to hear and see a live webcast. In addition, shareholders and proxies have the ability to ask questions and vote on resolutions. I'll provide further details on those matters shortly. Just wanting to roll off on the floor.

Some housekeeping matters for those of you who have joined us in person. First, I'd like to remind you as a matter of courtesy to please turn your mobile phones to silent. Also, if there's an emergency we need to leave, please do so through the marked exits. Staff will be available to help us in the eventuality that, that happens.

I'm pleased to confirm that we have a quorum and, therefore, declare the 2026 Annual Shareholders Meeting of Scales Corporation Limited open. The items of business for this meeting and the resolutions to be considered by shareholders are contained in the Notice of Meeting, which was sent to shareholders on the 10th of March.

Our order of proceedings is as shown on the current slide. I'll briefly comment on the highlights of the last 12 months, followed by a review by Andy Borland, our Scales Managing Director. We'll then attend to the resolutions where we'll cover each resolution in turn and invite questions specific to those items. I'll explain the process for asking questions, then I'll open the online voting and explain the voting process.

Once the meeting is complete, we hope that those of you present will join us for refreshments. This will also be an opportunity to meet the directors and senior management of the group and raise any questions you may have on an informal basis.

Firstly, I'll now summarize the process for asking questions. For those of you attending the meeting virtually, if you'd like to submit a question, the Q&A is always open. So please feel free to submit questions throughout the meeting. These will be addressed at the relevant time. To do so, please select the Q&A tab on the right half of your screen as currently shown. Type your question into the field and press send. Your question will be immediately submitted.

Good afternoon, ladies and gentlemen, and I'm Mike Petersen, Chair of Scales Corporation. And it's my pleasure to welcome you all to this annual meeting. Thanks for coming out today. I know it's a beautiful day outside, and you would probably rather be enjoying it in the sun. But we're thrilled to have you in attendance here, not only in person but online as well as through the virtual meeting today.

It's a 114th Annual Meeting of the company, the 12th since it became a listed company and my fourth as chair. Once again, we're holding a hybrid annual meeting and whether you are here in person or joining us online, I'd like to thank you and welcome you all.

As you may recall, shareholders, proxies and guests attending the meeting virtually, will be able to hear and see a live webcast. In addition, shareholders and proxies have the ability to ask questions and vote on resolutions. I'll provide further details on those matters shortly. I just want this morning to roll off on the floor.

Some housekeeping matters for those of you who have joined us in person. First, I'd like to remind you as a matter of courtesy to please turn your mobile phones to silent. Also, if there's an emergency we need to leave, please do so through the marked exits. Staff will be available to help us in the eventuality that, that happens.

I'm pleased to confirm that we have a quorum and, therefore, declare the 2026 Annual Shareholders Meeting of Scales Corporation Limited open. The items of business for this meeting and the resolutions to be considered by shareholders contained in the notice of meeting, which was sent to shareholders on the 10th of March.

Our order of proceedings is as shown on the current slide. I'll briefly comment on the highlights of the last 12 months, followed by a review by Andy Borland, our Scales Managing Director. We'll then attend to the resolutions where we'll cover each resolution in turn and invite questions specific to those items. I'll explain the process for asking questions, then I'll open the online voting and explain the voting process.

Once the meeting is complete, we hope that those of you present will join us for refreshments. This will also be an opportunity to meet the directors and senior management of the group and raise any questions you may have on an informal basis.

Firstly, I'll now summarize the process for asking questions. For those of you attending the meeting virtually, if you'd like to submit a question, the Q&A is always open. So please feel free to submit questions throughout the meeting. These will be addressed at the relevant time. To do so, please select the Q&A tab on the right half of your screen is currently shown. Type your question into the field and press send. Your question will be immediately submitted.

Should you require any assistance of any sort, you can type your query and one of the Computershare team will assist us in the chat function. Alternatively, you can call Computershare on 0-800-650034. Questions may be moderated or if we receive multiple questions on one topic, amalgamated.

Due to time constraints and to ensure all shareholders have a chance to ask a question, I ask that you limit yourself to asking 2 questions, please. And any questions that are not answered in time will receive an e-mail response after the meeting.

For those of you present here today, we'll offer you an opportunity to ask questions on or speak to each resolution being put to shareholders at the appropriate time. As I mentioned earlier, there will also be an opportunity to ask questions of individual directors informally after the meeting.

With regard to online voting, if you are eligible to vote, you'll be able to cast your vote under the Vote tab as shown on the screen. Once the voting is open, resolutions will allow votes to be submitted. And to vote, simply select your voting direction from the options shown. You can vote for all resolutions at once or by each resolution separately.

Your vote has been cast when the tick appears. To change your vote, simply change simply select change your vote, you're able to change your vote up until the time I declare voting closed. You may submit questions on each resolution being put to shareholders using the question process.

For those of you that have joined us in person here today, those shareholders who are entitled to vote and proxies too have discretion as to how they vote should have received a voting or proxy form when they registered upon arrival at the meeting. If you completed a postal vote, you don't need to complete another voting or proxy form.

If you haven't received a voting or proxy form at the time of voting, please go to the Computershare desk in the foyer where their representatives will be able to assist you. After voting, please place your voting or proxy form in one of the ballot boxes, which will be passed around the room.

I'll invite you to vote after all the resolutions have been introduced to the meeting. I now declare voting open on all items of business. For those of you attending via the Computershare online meeting platform, the resolutions will now be opened on the Vote tab. Please submit your votes at any time. I'll give you a reminder before I move to close voting.

I know those are quite complex instructions, but I assume everyone's got them under control. And if you need any hand or any advice at any time, please don't hesitate to contact one of our teams that are sitting here today.

Before I go further, I'd like to introduce my fellow directors, who are in attendance. They are Andy Borland, our Managing Director; Tony Batterton, who's Chair of our Scales, Nominations and Remuneration Committee Chair and also Chair of the Scales Finance and Treasury Committee and an Independent Director; Miranda Burdon, Chair of the Health and Safety and Sustainability Committee and an Independent Director. Nick Harris as an Independent Director; and Paul Munro, Chair of Scales' Audit and Risk Management Committee and an independent director.

I'd also like to introduce our latest future Director, Emma Crutchley, where is Emma in the audience here. Beside David, there we go. Great. Nice to have you onboard Emma. I could see David. I just couldn't see Emma Crutchley. Emma has been great. We love that future director position, and it's been great to have Emma on board.

We also have members of Scales management and staff in attendance. So thank you for those people. Deloitte, our auditors, and Anthony Harp, our lawyers are also in attendance. So I'm delighted to welcome everyone to the meeting. I'm very pleased to declare that Scales delivered record results across all its earnings measures for full year 2025.

Our underlying EBITDA was $137.6 million, an increase of 50% on last year. Underlying net profit after tax attributable to shareholders was $61.8 million, an increase of 82% and reported NPAT attributable to shareholders was $101 million, an increase of over 200%. There were strong performances across all of our divisions. Horticulture produced an outstanding result. There was a strong performance from Global Proteins and another good result from our Logistics team.

We declared an interim dividend of $0.125 per share in December last year in respect to the 2025 financial year and expect to declare a final installment early next month. These are fantastic results, and we're really delighted to be able to report these record results to you today.

2025 was another successful year for transactions with the group increasing its investments in Shelby, Meateor Australia, Fayman International and ANZ Exports. This takes our investment in Shelby to 67.5% and ANZ exports to 85% with Meateor Australia and Fayman International now being fully owned. Due to these investments, I'm pleased to note that we've increased the Global Proteins full year '27 underlying EBITDA target from $70 million to $85 million.

Governance is extremely important to us, and we continue to review and refresh our director and senior management teams. Accordingly, I'd like to take a moment to acknowledge Alan Isaac, who retired as a director in October last year. Alan was a major contributor to Scales' governance program, served on the board for over 11 years. And not only was Alan the Chair of the Audit and Risk Management Committee, he also chaired the due diligence committee as part of Scales' listing process. With his accounting and finance background, he provided excellent financial knowledge and wise counsel.

In Alan's place, we were pleased to welcome Paul Munro to the Board in October last year. Paul also has a significant accounting and finance background as well as an extensive governance experience from a wide range of public and private entities. Welcome to you, Paul, and already Paul's contributed significantly in his time with Scales.

We also announced that Steve Kennelly is stepping down as CFO in May of this year with Ben Washington replacing him. Steve has been with Scales since 1993 in a variety of accounting and finance roles being appointed as CFO in 2011. However, we are pleased to advise that Steve isn't leaving us completely as he's going to take up a new role as Company Secretary and we'll be able to retain that institutional knowledge that he's brought through that -- through his time with the company.

We're really pleased and excited to welcome in Ben Washington in Steve's place and Ben's with us here today. Ben will start in June, joining us from KMD Brands, where he's held several senior leadership positions, most recently as CFO of Kathmandu. We were also pleased to announce last month the appointment of Geoff Smith as CEO of the Horticulture in the Logistics division; and Charles Ferguson, as CEO of Global proteins.

These appointments as divisional CEOs are really important to the Scales Group and are designed to provide more dedicated leadership across our divisions, support the execution of strategy and enable continued growth. Geoff was previously our Chief Operations Officer, where Charles joins us from Synlait where he held senior executive leadership roles. Charles is not here today, but he's going to start with the Scales in June this year.

Finally, as I mentioned earlier, Emma Crutchley joined us as a future Director and would like to thank Emma for insight contribution and participation. Scales' Board of Directors is always looking for ways to improve transparency for shareholders without compromising commercial sensitivity on key matters relating to the business.

We regularly review our continuous disclosure requirements to make sure we're adhering to best practice governance and strive to make improvements and reporting framework. This year, we have received feedback from some shareholders about gender diversity on the Board, the time period between the release of the 2025 annual report in the Annual Shareholder Meeting, and request for further details about senior management LTI and STI remuneration targets.

I would be happy to expand on this further during the questions if required in the general business section of this meeting. But I can assure shareholders that we are addressing all of these issues, and we'll have these completed prior to our next Annual Shareholders' Meeting.

As in previous years, the group in its results would not be what they are without the commitment and enthusiasm of each Scales' team member. We're extremely fortunate to have such a dedicated workforce with each of them embracing Scales' culture and delivering exceptional results, and I'd like to say a very big thank you to them all.

Health, safety and wellbeing remains a core focus for us with continued integration into our businesses. Health and safety for us is about culture. It's not about compliance, and we put a real effort on this over the past 12 months.

We executed a number of initiatives last year including independent health and safety assessments across key businesses as well as developing an improvement road map for the next few years. There is also a strong emphasis placed on leadership engagement and training, including a session for the Board and senior leaders focusing on the governance. We also undertook a staff engagement survey for all New Zealand businesses. And pleasingly, this confirms strong and consistent engagement pride and teams and confidence and leadership.

We plan to roll this out globally next year. We also continue to progress Mr. Apple's people strategy across a number of areas. Our local communities where we operate are extremely important to us. And during 2025, we supported various initiatives as noted on screen. We consider our involvement in these kinds of initiatives carefully, ensuring that we partner with businesses and organizations that are aligned to our values and provide a long-term social impact.

I'll now hand over to Andy, who will update you further on last year's results and activities. He will also provide an update on the transactions undertaken in 2025 and also provide a brief outlook for the group. Following Andy's presentation, we'll move to the formal business of the meeting.

However, before Andy takes over, I'd like to acknowledge our dedicated staff members working across the world. I can't emphasize this enough. These people come together to form teams within our global organization working to make Scales the best it can be. These people are the heart of our business and allow us to achieve the successful delivery of our strategy and the results that you're hearing about today.

On behalf of the Board, we would like to thank all of our people across the world for the ongoing contribution to the success of our group. As always, we welcome feedback on any matters raised today during today's presentation or other general matters in relation to the group and we're happy to do that, as I say, in the questions and general business after the presentations conclude, and we'd be delighted to also have those conversations informally with you at the end of the meeting today.

Andy, I'd like to pass over to you to cover off some further details.

Thanks, Mike, and good afternoon, everyone. I did mention -- well, we mentioned before a fellow Dave Foot, if you want to put your hand up, David. David is a Director from Australia. He's on Australian subsidiaries, a professional director, both here and in Australia, and we welcome your input David and wisdom.

So I'll start with a brief overview of 2025. A few of our key numbers are highlighted on this slide. A couple of items of particular note that revenue was just under $900 million, which was an increase of 54% on last year. In addition, Mr. Apple exported 3.7 million TCEs of its own grown apples, which are up 21% compared to 2024.

Our 5-year performance for underlying NPAT attributable to shareholders underlying EBITDA and revenue illustrated on this slide showing the significant increases in those measures in FY '25 compared to prior years. Moving on to some more detail in respect of our 2025 results. As Mike mentioned, the group achieved record results across all its earnings and measures driven by growth strategies across all the divisions.

There was also a positive impact from our increased shareholders and our joint venture businesses. You'll note that the 2024 results have been restated, which is due to an increase in apple tree valuations at Mr. Apple. The net impact of those prior year adjustments to an underlying NPAT attributable to shareholders level was around $200,000.

The graphs on this slide show the 5-year underlying EBITDA for each of the divisions and again show the increases in earnings in FY '25 compared to prior years. As you can see, the 2024 results for Horticulture have been restated, but there is no restatement for either Global Proteins or Logistics.

I'll now provide a bit of more detail for each of the divisions. Global Proteins generated a solid result with increases in both pet food ingredient volumes and edible protein volumes of 9% and 10%, respectively. And we realized the benefits of our increased joint venture investments with increases in revenue, underlying EBITDA and underlying EBIT compared to last year.

Shelby, Meateor Australia, Meateor New Zealand and Fayman International performed particularly well. Shelby had a solid performance, while it transitioned to a new toll processing facility. Meateor Australia and Meateor New Zealand performed significantly ahead of forecast with margins ahead of expectations. And Fayman International had a strong performance, increasing sales to both the Southeast Asia region and U.S. markets.

Esro Petfood continued to progress through its start-up phase whilst also transitioning to a new processing facility. Revenue and margin per kilogram of volumes sold within pet food ingredients business have been influenced by changes in business mix, which resulted in a small decrease in revenue per kilogram. However, improved margins across Meateor New Zealand, Meateor Australia and Esro resulted in increased underlying EBITDA per kilogram.

Turning to Horticulture. 2025 was an exceptional year for the Horticulture division with increased volumes, higher average prices and an increased proportion of premium variety volumes such as Dazzle and Posy. The addition of the Bostock orchards last year helped to fast track these factors. Mr Apple's own grown export volumes increased 21% compared to last year with external grower volumes increasing 49%.

This was helped by very good growing conditions as well as the integration of the Bostock orchards. Premium apple volumes accounted for 74% of export apples sold, a slight increase on 2024 with significant growth in Dazzle and Posy apples. 2025 volumes were significantly higher than all previous years and 16% higher than 2021, which was our previous record year.

Sales into the Asia and Middle East markets also grew compared to last year with marketing, sales promotions and customer support in these markets, supporting the volume increases. Profruit also continued to perform extremely well, delivered another excellent performance aided by strong sales prices in its export markets.

The forecast percentage of premium variety apples for the next 3 years is depicted on the current slide, along with our forecast volumes. In addition to integrating the Bostock orchards and continuing our orchard redevelopment program, we're continuing to develop exciting new premium varieties, which have been grafted onto existing trees and are expected to supply a new wave of growth.

As a result, we currently project that premium varieties will account for around 80% of export volumes by 2027. And last but certainly not least, our Logistics business for the second year running Logistics -- Scales Logistics produced a record result. Whilst both ocean freight and airfreight volumes were up on last year, airfreight volumes showed a significant 81% increase due to strong volumes from the dairy sector and a positive cherry season.

The division also benefited from strong apple volumes. This helped Scales Logistics to produce a 21% increase in revenue and a 10% increase in underlying EBITDA. The group's overall financial position and net debt reflected the investments made in Global Proteins joint ventures businesses during FY '25. However, our financial position remains strong for further investment opportunities.

The most significant cash outlays last year were those required for our joint venture investments, other significant expenditure, including dividend payments including those to minority shareholders and CapEx. Sustainability continues to be a key focus for us. And during 2025, we completed a refresh double materiality assessment in order to understand our stakeholder priorities.

In terms of environmental projects, we're looking forward to releasing etch climate statement later this month, which will be our third report of this nature. During 2025, an assurance exercise was undertaken to confirm our Scope 1 direct and Scope 2 indirect greenhouse gas emissions data and analysis of Scope 3 raw material emissions was progressed.

In our regenerative planting trials, that is planting trials that aim to restore soil health increased biodiversity and enhanced ecosystem function continued at Mr. Apple and pleasingly, these showed early indications of improved soil health and fruit quality.

With a global market presence, Scales focuses on providing customers, investors and regulators with confidence in our business units consistently to meet or exceed market access, product quality and assurance requirements. So we regularly complete third-party audits and assurance programs.

We're also keen to share some of the knowledge that we've gained, and last year, Mr. Apple established a new export initiative to support Maori kiwi fruit growers to access international markets, particularly in the Middle East. This reflected a shared commitment to strengthening grower participation in global value chains, while supporting inclusive economic development and resilient market access for Maori grown produce.

Additional details of these and other projects were provided in the sustainable section of our annual report, and we also look forward to sharing more detail in our climate statements.

As Mike already touched on, 2025 was another successful year for transactions with increased investments in Shelby, Meateor Australia, Fayman International and ANZ exports. Shelby's performance has been fundamental to Scales' success in recent years with earnings growth since our initial investment materially exceeding expectations. We believe the various initiatives are in place and this business will contribute to our Global Proteins targets.

Meateor Australia's progress from start-up to full production has been extremely pleasing. The Australian market is also of high strategic importance and this increased investment will allow us to continue to explore growth opportunities. Fayman International and ANZ exports have exceeded our initial expectations and play an important role in the edible protein sector with a focus on Australian exports. They're currently capitalizing on the strong global beef market with Australia being a key worldwide supplier.

The strong connections these businesses have to the Australian supply network also assist Meateor Australia. These acquisitions reflect Global Proteins' ambition of increasing our joint venture shareholdings over time. And as Mike also mentioned, the division's FY '27 underlying EBITDA target has increased from $70 million to $85 million.

In terms of the overall group outlook, we're pleased to confirm our previously advised guidance range of underlying NPAT attributable to shareholders of between $50 million to $55 million. The underlying NPAT and underlying EBITDA also remain as previously advised. However, as you will appreciate, geopolitical uncertainty is expected to continue throughout this year.

In terms of divisions, we expect Global Proteins to continue to perform strongly and realize the benefits of its increased joint venture investments. And Horticulture picking and packing is well advanced for the 2026 apple season with a crop of around 3.5 million TCEs forecast. Pricing is expected to be positive, impacted by a number of factors, including favorable foreign exchange rates.

Profruit and Fern Ridge are trading positively. And we expect Scales Logistics to continue to contribute positively and are pleased to note that as continued to experience strong airfreight demand in the year-to-date. That concludes my presentation. We'll answer questions following the resolutions.

But in the meantime, I'll pass back to Mike to cover the formal part of today's meeting. Thank you.

Thanks, Andy. And I know there's a lot of information in there. But hopefully, you've had some time to digest that and we'll be able to answer any questions you might want covered off later in the general business part of the meeting. We'll now move to the business of the meeting. All items of business are ordinary resolutions and are required to be passed by a simple majority of votes.

Current best practice for shareholder voting is by way of poll. Accordingly, a poll will be held for each of the resolutions. I and my fellow directors hold the following undirected proxies. With respect to Resolution 1, authorization for the directors to fix the auditor's remuneration for the coming year, 172,800 shares. With respect to Resolution 2, the election of Paul Munro as non-Executive Independent Director, 172,800 shares. With respect to Resolution 3, reelection of Miranda Burdon as a Non-Executive independent director, 172,800 shares. With respect to Resolution 4, reelection of Nick Harris as a Non-Executive Independent Director, again, 172,800 shares. With respect to Resolution 5, reelection of myself, Mike Petersen, as Non-Executive Independent Director, 172,800 shares.

With respect to Resolution 6, authorization that the maximum total pool of directors' remuneration payable by Scales to directors be revised, 192,800 shares. Your Board supports these resolutions, and we intend to vote all these shares in favor of the resolutions.

I'll now move on to each of the resolutions, and I'll do them independently. Resolution 1 relates to the remuneration of auditors. This proposed ordinary resolution is to authorize the directors to fix the auditor's remuneration for the coming year. In accordance with the Companies Act, Deloitte has automatically been reappointed as Scales' auditor.

As is usual with audit fees, due to the complexity and changing nature of the company's affairs, it is not possible to fix the remuneration at the beginning of the year. I now move as an ordinary resolution that the Board is authorized to fix the auditor's remuneration for the coming year. Are there any questions on this resolution?

Thank you. We'll now move to the next resolution. Resolutions 2 to 5 relate to the reelection of a director. The NZX listing rules state that directors must not hold office without reelection past the third annual meeting following the director's appointment or 3 years, whichever is longer. In addition, any director appointed by the Board during the year is required to offer themselves for election by shareholders at the next meeting. Accordingly, Paul Munro offers himself for election, whilst Miranda Burdon, Nick Harris and I are required to retire at this meeting and offer ourselves for reelection. Resolution 2 relates to the election of Paul Munro.

Paul was appointed to the Board in October 2025 and a brief biography for him was included in the Notice of Meeting. Paul being eligible, offers himself for election, and the Board unanimously supports his election and recommends that shareholders vote in favor of Resolution 2.

I'd now like to invite Paul to briefly address the meeting on his proposed election. Thank you, Paul.

Thanks very much, Mike, and good afternoon, everybody. As Mike summarized, it was my privilege to be appointed to the Board of Scales Corporation in October last year. As has been noted, I succeeded Alan Isaac as the Chair of Scales Audit and Risk Committee, and I'm very aware of the big shoes I've got to fill taking on Alan's role.

Alan did a fantastic job for 12 years governing this company. And I think the results are certainly reflective of the diligence and the expertise that Alan brought to the table. So I'll endeavor to do a good job following in his footsteps.

Scales is a great company. Scales is an iconic company. Scales is a company with over 100 years of history, and there's not many New Zealand companies that can actually say that. The role that Scales plays is focused is primarily on the primary sector. The primary sector is a really key part of our economy. I think we all know that, and I'm sure shareholders you all know that, and that's probably part of why you're invested in Scales. The primary sector for a long time has been the backbone of the New Zealand economy, and I think it will continue to be the backbone of our economy as we move forward.

And so it's my privilege to be able to play a small role in supporting Scales on that journey. I bring experience to my governance roles from 24 years at Deloitte, where I was a corporate finance partner. I then spent 6 years as the CEO of a publicly owned investment company that owned a $5 billion asset portfolio spread across a range of commercial infrastructure investments.

And over that time and since I left that CEO role, I've spent over 15 years in independent governance roles, spanning public sector, private sector and spanning a number of different industries.

As I said, it's an absolute privilege to have been invited to join the Scales' Board. I really appreciate your support. I appreciate my fellow director support and the support of the Scales management team. And thank you very much for listening.

Thank you, Paul. While I now move as an ordinary resolution that Paul Munro be elected as a Non-executive independent director. Are there any questions on this resolution?

What do you see as the greatest risk to Scales future profitability?

Just to repeat the question in case that doesn't come through. Paul, what do you see as the greatest risk to Scales' profitability?

Yes, that's a really good question. I think one of the benefits that Scales does have is that it's a diversified portfolio of investments spread across 3 sectors Logistics, Horticulture and Edible Proteins or Proteins rather. I think that does, in many ways, spread that risk, but inherently, any company operating business world today is subject to risks that we can't control, ranging from things like climate change to operating in environments where you can't control the impact that cyclones may have on your apple crop over the weekend.

And so nothing is without risk, but I think Scales is actually really well positioned to navigate the future, and we've certainly got a very capable management team and a very well developed and mature risk framework that's used day to day by the management team and the board to monitor risks and make sure that the mitigations are in place to manage them successfully. Thank you.

Thanks, Paul. Any further questions for Paul? Okay. Thank you very much. We're going to move to Resolution 3 now, which relates to the reelection of Miranda Burdon. Miranda was first appointed to the Board in 2022, and a brief biography for her was included in the Notice of Meeting. Miranda being eligible, offers herself for reelection, and the Board unanimously supports her reelection and recommends that shareholders vote in favor of Resolution 3. I'd now like to invite Miranda to briefly address the meeting on her proposed reelection.

Thanks, Miranda. Over to you.

Good afternoon. I'd like to thank you, the shareholders, for the opportunity to support the growth and continued prosperity of Scales Corp. as an Independent Director. Scales is a business, as we've heard, that has enormous heritage in the primary sector and one that continues to lead and to innovate to deliver ongoing growth.

My career has been heavily centered on the primary sector in New Zealand, albeit predominantly on the commercial side of many of the good things in life, such as mushrooms and cucumbers and other covered crops, dairy and wine, all the important stuff. And this has been helpful. The past 3 years have reflected the somewhat mercurial nature of the primary sector, but also the benefit of our continued diversification.

I enjoy my role at Scales and am fortunate to be able to utilize my combined experience, including that gleaned from the entrepreneurial endeavors that I've been involved in to support the different divisions of Scales in its growth journey.

My governance experience has involved roles in private boards, Crown entities, sector bodies such as Emerging Proteins New Zealand as well as charitable initiatives where I have most recently been the Chair of the Live Ocean Foundation, which is an entity founded by Peter Burling and Blair Tuke and committed to Ocean Health.

So one of the elements, and I'm repeating Paul's comments to some extent, one of the elements that continues to impress me at Scales is the commitment of the executive team and the caliber of people that we have involved in our organization. The team has demonstrated good systems and organization and resilience that as a business will continue to stand us in good stead.

As the Chair of the Health, Safety and Sustainability Committee, it's been very visible just how much work has taken to achieve these outcomes. So I look forward to continuing to support the team and the business. And again, I thank you for your support.

Thanks, Miranda. I'd now like to move as an ordinary resolution that Miranda Burdon be reelected as Non-Executive Independent Director. Are there any questions on this resolution? No, thank you very much.

Resolution 4 relates to the reelection of Nick Harris. Nick was first appointed to the Board in 2014, and a brief biography for him was included in the notice of meeting. Nick being eligible, offers himself for reelection, and the Board unanimously supports his reelection and recommends that shareholders vote in favor of Resolution 4.

Nick has indicated that if reelected, he intends to retire from the Board prior to the next annual meeting at which he would be required to stand for reelection. Following next confirmation of his retirement, the Board will look to appoint an additional director in accordance with the Board's succession plan.

I'd now like to invite Nick to briefly address the meeting on his proposed reelection. Over to you, Nick.

Thank you, Mike. As Mike mentioned, I've been involved in Scales back start 2012, when I came on as an independent director of the storage in the Logistics division, this being Polarcold, Whakatu Coolstores, Liqueo, Meateor and Scales Logistics. In 2014, when Scales floated, I became a Director of Scales Corporation. Over the following years, I've been on the Audit and Risk Committee and more recently have gone on the Board of Scales Australian investments in Fayman International and Meateor Australia, along with David.

Outside of Scales, I've been in the meat industry all my life, having helped set up a large bacon, ham and small goods company. Kao-Pei, Hellers, my currently day to day, as still being involved in the meat industry from my family business, Harris Farms, an integrated meat company in Cheviot Farming, got 1,000 hectares of irrigated land, and we process animals on our farm, abattoir and processing facility. We now have a site in Christchurch as well.

I am a qualified accountant and have over the last 35 years, helped support many not-for-profit trade associations, sporting entities and committees, trusts and boards. Having worked in a large business has helped me understand the day-to-day commitment that our senior executives make here.

Along with my knowledge in the meat industry, this has been advantageous at Scales as we have expanded into the Global Protein market. I look forward to serving you the Scales shareholders and working with the Scales team and our Board for another year. But as stated in my citation for this AGM, I plan to stand down from the Board over the next 12 months. Thank you all.

Thank you, Nick. I'd now like to move as an ordinary resolution that Nick Harris be reelected as a Non-executive independent director. Are there any questions on this resolution? Okay. Thank you very much. We'll now move to the next resolution, which I'll ask Andy to introduce.

Thank you. We'll now move to the next yes, right. This -- jumping the gun there. Thanks, Mike. The Resolution 5 relates to the reelection of Mike Petersen. So Mike was first appointed to the Board in 2023, and a brief biography for him was included in the notice of meeting. Mike being eligible, offers himself for reelection, and the Board unanimously supports his reelection and recommends that the shareholders vote in favor of Resolution 5.

I now invite Mike to briefly address the meeting on his proposed reelection. Over to you, Mike.

Thank you, Andy. And look, it's a real privilege to be here again today and up for reelection. For those of you who don't know me at all, I'm a farmer from Hawke's Bay, 35 years farming, moved into governance roles about 25 years ago, and I've had a real privilege of operating in the agribusiness sector.

It really is -- and you can see today in New Zealand's current environment, the agribusiness sector is the place that's holding this country together. And I'd like to think that in some small way I've contributed to some of the companies that have succeeded and flourished.

And that's what I really enjoy doing. I -- as you can see on the board there, I'm a current Director and Chair of Scales Corporation, a Director of ANZCO Foods. I'm also a Director of a number of other private and locally held companies across the agribusiness sector, and I'm currently involved in sharing a water security project in Hawke's Bay as well.

I just have a huge passion for agribusiness. It's something that I love. It's where my real connection and heart is. And people talk about governance roles. If you don't have empathy with the sector you're involved in or the roles that you're doing or the people you're working with, then you shouldn't be there.

And this is -- Scales Corporation is exactly the company that I really have empathy with and enjoy serving alongside the amazing people that we have here today. I was -- it was an interesting start to my role in Scales when I started in 2023, and that was the annual meeting. My very first meeting was that I came in to Chair -- I chaired the Board meeting and chaired the annual meeting that same day on my very first board meeting. So I was really thrown into the fire a bit.

But look, I've absolutely loved the last 3 years during the time it's flown by. And I think we've achieved a lot. If you look at the results today, we've tripled the underlying NPAT attributable to shareholders and 2025 is a record result. So I'm not going to claim credit for the share price, but after Cyclone Gabriel, it was pretty low at around $2.80 and we're nearing $6 today.

So I don't think that's necessarily a reflection of me and my role. But certainly, I think if you look at the teams that we put together the people that are in the company today and the next step and the next stage of the people that are coming into the company with these divisional CEO roles, I think the future for Scales is very exciting indeed.

I love being here with the people, the culture of this company is fantastic. And look, I would really welcome and appreciate your support in voting me back as a director for the coming 3 years. So I can help contribute more to this wonderful company of yours. Thank you.

Thanks, Mike. I now move as an ordinary resolution that Mike Petersen be reelected as a Non-executive independent director. Are there any questions on this resolution. No questions, right? I'll hand back to you. Thank you.

Thanks. I'll now pass back to you, Mike, it says here now Andy. Thank you very much. Okay. Resolution 6 relates to a proposal to increase the maximum total pool of directors' remuneration available for your Board of Directors by $130,000 being the equivalent of AUD 110,000 per annum to $755,000 per annum for the 2026 year and onwards effective from the close of this annual meeting. Shareholder approval for this has required under NZX Listing Rule 2.11.1. An appropriate fee structure is important to ensure that Scales can continue to attract and retain the right governance skills and experience to govern your business and that those directors are being fairly remunerated for the work they do.

The proposed increase in the directors' fee pool was being sought as a consequence of Scales increasing its shareholding in its Australian-based Global Proteins joint ventures last year, which resulted in Meateor Australia, Fayman International and ANZ Exports becoming wholly or partially owned subsidiaries of Scales.

Each of these entities currently has 2 directors, who received combined director fees of AUD 110,000 per annum, and these fees now need to be accommodated within Scales' fee pool. For the avoidance of doubt, current fees payable per director are remaining unchanged. I just want to be clear about that.

I now move as an ordinary resolution that the maximum total pool of directors remuneration payable by Scales to directors and their capacities of directors be revised from $625,000 per annum to $755,000 per annum. In accordance with the NZX listing rules, the directors and the associated persons are restricted from voting on this resolution. Are there any questions on this resolution? I understand there's a bit of complication here.

But the incorporation of these joint ventures becoming subsidiaries of ours, we need to include these in the pool. And look, it's lovely to have David Foot here with us from Australia, who's actually serving a really good role for us on that Australian company of ours. So are there any questions from any of the shareholders? Okay. Thank you.

Okay. Ladies and gentlemen, that concludes our discussion on the items of business. I'll close the voting online very shortly. If you haven't already done so, please cast your votes now. A reminder of how to vote online is shown on screen. Computershare will now collect the voting papers from shareholders in the room.

Once all the votes have been cast, they will be counted by the company's share registrar, Computershare and scrutinized by the company's auditor. The results of today's meeting will be released to the NZX on the completion of verification of voting.

I'll now pause to allow you to finalize voting and put your ballots into the boxes as they're being passed around the room before we move to general questions.

[Voting]

Good everyone is there, do you think? Thank you very much. Everyone put their votes in the box. For those online, okay, ladies and gentlemen, voting is now closed. Thank you very much. We'll now move on to general questions. And if there are any questions on the financial results, the business update or any other matters you'd like to raise. For those online, please do so through the Computershare online meeting platform.

A reminder of the process is shown on screen. For those of you present, I'll open the floor to any questions. Just a reminder, if we run out of time to answer questions here today, we'll respond to any additional questions in writing following the meeting. Ladies and gentlemen, the floor is open. The floor is yours and over for questions. Here, sir?

Sorry, just remind you to please wait until the microphone comes because then the people online won't be able to hear the question.

Yes. I am Frank Stewart. I represent the New Zealand Shareholders Association. Each year before the annual meeting, we do a governance report for a company. And we look at about over 100 items and we condensed that down to 15. I should have said before, I'm not actually a shareholder because I transferred my shares to my -- one of my grandchildren. I've still got an interest.

As I said, we're convinced -- condensed the items down to 15 categories. And of the 15 categories, I guess we would have marked you A plus for 13 of them. And for 2 of them, there was a couple of minor things and would mark it as an A.

So it's quite a good result. And over 20 years of involvement with the New Zealand Shareholders Association, I don't look at all the reports of companies, but that's the most impressive one I've ever seen. So that's good.

Thank you very much. Now we always appreciate. We always appreciate feedback from the shareholders association.

A couple of questions when I ask because there's about 60 people in the room. How many are online?

Yes. And Mr. Kennelly has got that answer?

Sorry, that has changed during the meeting, but currently 47.

47 online.

And the second question is you haven't mentioned it at all. So can I assume that you're not directly affected by the events in the Gulf?

Look, thank you for the question about the events in the Gulf. We are affected, but you would've heard in Andy's report about the guidance for the coming year that at this stage, there is nothing that we know that will affect the guidance that we've provided to the market. And so we're reiterating our current guidance, which has stayed the same.

On the both protein foods you're producing a lot of edible Foods. Could you expand what they are?

So the question, Andy, is difference between the edible and nonedible, so explain on the edible foods part of the business, please?

Yes. Look, it's a range of proteins, mainly beef, a lot of offal, a lot of beef offals going up into Asia. But in the America, the products we're sending to America are more meat trims, meat items. But yes, across the board, a very big proportion of beef, some chicken and a little bit of fish. That's right, yes.

Okay. So just to clear, the purchase from the meat processing companies. And you're right. I mean, certainly with the Fayman business, that's more of an edible business, edible foods business, but the bulk majority of our work in global proteins is inedible for pet food ingredients. Other questions? Questions in the room before we go to online. Yes, there's one in the middle here. Thanks, Lisa.

Regarding inedible proteins, where do you see the petfood thing in the next 5 years?

Yes. Thanks for the question, Keith. I'll just note that Keith was a boss of mine in 1981. J.E. Watson and Cole.

It wasn't that long ago.

No. Keith, the pet food sector is -- we still believe is a very strong sector to be involved in. Its growth in many countries is continuing. The growth in CAGR growth, we call it as a very solid number on the up. So we certainly are -- there's been the odd slowdown, particularly Middle America probably did a slowdown last year.

But funnily enough, the more commodity products and the high-end products went really well. And we're more exposed to the high-end side with the beef in America.

So yes, very positive about the outlook for the sector going forward.

Yes, there is a question in the front here.

Warren, a shareholder. I was wondering if you could explain the shareholding structure a bit more because we have things like net profit attributable to shareholders and then some of the net profit, not attributable to shareholders. So what is this structure?

It really reflects the minority shareholders have in the subsidiaries.

Joint ventures.

And the joint ventures, sorry. Yes. So well, the Shelby is a subsidiary. Yes. So it's really -- we've trying to report to you as our shareholders as the earnings that I guess you are making having adjusted for what they've -- the total company was making what was that, Steve? NPAT attributable the total number was nearly $100 million, yes, versus the $62 million was attributable to the shareholders in the room and the rest of the Scales shareholders.

So that means, for example, in Shelby, where we own 67.5% of that business, it's those earnings 67.5% of their earnings are attributable to you as shareholders, because the minority partner will take the balance.

Could you just clarify your policy on the level of dividend compared to earnings. Do you have a policy?

We do you have a policy -- We do have a policy, Steve, just to get 50% to 75%.

75%. Yes NPAT attributable. Net profit after tax attributable to shareholders, yes, between 50% and 75%. Very good. Any other questions in the room? Yes, sir. That was just a microphone. Thank you.

Thank you. Ian Upston, shareholder. I have Australian shares and it irritates me that is a New Zealand shareholder, I don't get the Australian franking credits. And vice versa, the Australians investing in New Zealand can't get our imputation credits and this needs to be brought to the attention of the politicians that it's restricting investment between the 2 countries. So how is the company treated as dividends from offshore investments as far as getting back in franking credits, if that's possible.

No, it's a very good point. And look, I'm not the accountant and I'll pass to maybe Paul or Tony to answer that question. But you've raised a very important issue where because a lot of our earnings -- a lot of our earnings are owned offshore and then the imputation credits are not available when we pay the dividends to shareholders in New Zealand. So Tony, did you want to expand on that? Or Paul or Steve?

I'll actually defer to my colleague, Jamal, and I wonder -- it's a rather complicated matter, and I wonder whether I could put you 2 together after the meeting to discuss that one.

I think I was broadly right, though, wasn't I?

The dividend, the imputation regime is relatively unique to the Australasian environment. At Scales in terms of paying dividends to our shareholders, we impute 50% of our dividends, and that's because we only have imputation credits available from our local earnings and that's the reason. So -- and that's not our Scales, then that's anyone operating in New Zealand with global operations runs up against that same issue.

So any New Zealand company operating out in the world that concept of dividend and mutation credit doesn't exist in the same way. So it's a good way of New Zealand companies distributing New Zealand profits back to New Zealand shareholders, that works really, really well. Once you get out to the global stage, that's not a concept that exists in the same way and it gets a lot more complicated by jurisdiction. Yes, effectively, there is that's what happens.

Yes. Your point is well noted. Okay. Any other questions in the room before we go to some online questions. Yes, in the front. We just go right down front here, John.

Russell Hint, a shareholder. I'd just like to hear about 2026. And how is our crop how are our crops going this year, particularly in view of the climate conditions that you guys have been facing up in the Hawke's Bay, et cetera.

I'm wondering whether Mr. Van Workum might want to comment. But yes, I'll trust you, Andrew, to give a brief update.

You might talk about every single apple.

Yes, look, we had put 3 pretty tough years until last year, and we'd argue the weather return back to normal last year and had a lovely crop. And we've been on target for the same thing this year, have a very nice spring. We had quite some weather in the middle of January, which knocked the fruit around EBIT. So that was -- but overall, nice rains, good cool nights and brilliant color. So very nice fruit looking fruit and eating fruit.

The storm that we were worried about a few days ago, that sort of yes, there was some wind. Not a lot of rain. I mean, the rain is quite good for us. It's not an issue at the moment. It's more the wind, but we're down to about 12% of the crop to pick. So most of the fruit is either in a carton on the way to market or in a cool store, we've got 120,000 wooden bins -- those big wooden bins full of fruit in cool stores. So we're sort of in the home stretch we're not quite jogging to the finish, but the finish is 2 weeks away. So we're in a very strong position. There's a nice crop this year.

Thank you. Thanks, Andrew. Well done. Very good. Steve, do you have any questions online that you'd like to...

We've got a number, Mike. So the first one comes from Allan King. Has the closure of the Strait of Hormuz affected trade to Middle East to date what percentage of our sales depend on the Strait being open?

Andy?

Yes. Look, we do send about or have sent of 6% to 8% of our crop to the Middle East and that some of that might get through overland route, but at the moment, it isn't. But -- it's a big Royal Gala market up there, and we can sell those Royal Galas and other markets. So we're thinking it's -- it's not what we prefer, but it's certainly something that we can mitigate.

Next question comes from Paul Grant. Is there an intention to increase Mr. Apple's plantings in Hawke's Bay.

Look, I think we're always looking at different opportunities. Clearly, our Bostock we talk about the Bostock transaction, but it was sort of a Craigmore transaction. We bought Land of John Bostock and Craigmore bought. So we bought developed land, a lot of from John. And -- but we sold undeveloped hectares to Craigmore, and they are an overseas entity, so they needed to do redevelopment.

So that deals sort of struck well. But we do look at our footprint around our capacity for packing and air bin capacity. So no, we don't want to plan another 500 hectares and have to do build another pack out that's half full. So it's sort of like filling in a box. You really want to be as efficient as possible when your infrastructure is working at maximum.

So we're pretty happy at the moment with our 1,200 hectares that we're farming, orcharding -- and while we're really doing inside that 1,200 though, we've talked about it as the new varieties that we're bringing through and being are more paying premium prices, good yields. So we're benefiting from the last 10 or 15 years of R&D, and that's where we're heading with that Mr. Apple business.

You'll see on our forecast for Horticulture that we sort of were at about 3.5 million and sort of peaked at about 3.7 million. But we are continually looking at opportunities to improve the premiumization of that mix. And so that's the exciting thing that we think about now as how can we continue to maintain that level to make sure our pack house is fully utilized, but increase the value of those apples coming off the orchards.

Next question comes from Grant. Do you see any opportunities sales arising from the misfortunes which have recently impacted McCains and Heinz Wattie in Hawke's Bay?

Well, I'm happy to try and answer that because I live in Hawke's Bay. Look, it has been tough and Hawke's Bay with the closure of McCains and Watties. And look, it potentially could open up some opportunities. There are certain ground that won't be growing vegetables in the next -- after next season because they've still got this team to follow through.

And some of that ground does have water consents available to it, which could open up some opportunities. But at this stage, it's very much unknown. I know that the current owners trying to sell those assets. We don't know whether anyone will come in and buy them and try to replicate what Watties and McCains were doing. But it certainly does open up some ground for apple growing, and we'll look at every opportunity.

Next question is from Ellen King, and it's simply $1 billion revenue this year?

$1 billion revenue this year? Question mark? We're very close.

I'd rather have $1 billion market cap.

$1 billion market cap, Andy is saying they'd be better for shareholders. Look, but look, we certainly are getting a tailwind with lowered New Zealand dollar, the value of the dollars, bringing returns back into New Zealand, which are stronger. But we're very early in the selling season for apples.

And there's quite a lot of uncertainty, particularly with the Strait of Hormuz and Iran war. So look, we're being very cautious as a board and as a company in trying to put projections out there at the moment, except we do know that we believe our current guidance is still intact, and we're going to strive to make sure that we -- those numbers.

Next question is from Marcus on Francisco, I think, is pronunciation. What is your view about growth in the New Zealand level industry over the next 5 to 10 years, maybe in comparison to the kiwi fruit industry?

Well, kiwi fruit is a behemoth that's growing incredibly and it's a fantastic industry. And look, apples is certainly still a growing industry. And you've seen a number of companies that have been growing their footprint and apples, particularly over the last few years. For us, we see modest growth in apples for us as a company. But you will have seen other companies that are expanding quite strongly, and they certainly see opportunities.

So a lot of it will depend, and we believe Hawke's Bay is the best place to grow apples in the world don't we, Andrew? Absolutely. A lot of it will depend on whether we can access water, and that's a real challenge for us in the region. Even though we're well secured, currently, any expansion would require water consent, and that's an ongoing challenge.

And last question online from Peter Hill. Is there a risk of fruit being grown offshore in competition as has happened with kiwi fruit in China?

Well, we're -- there are a lot of apples grown offshore in competition with New Zealand and some companies have a dual strategy of growing apples here onshore and then also growing offshore in the off season. So we're a little bit different.

We are preferring to grow all of our apples onshore, and we maximize the selling period throughout the year to ensure we get quality fruit into the market. So for us, that isn't an option. But look, we fully understand other company strategies and desires to do so.

And Andrew, do you want to make a comment on Fruitcraft and the new varieties?

Mr. Apple is a third shareholder in a company called Fruitcraft, and we find -- bring to the group, the 3 owners new varieties. We've got some really exciting things in front of us, and we're well on the journey with Dazzle which has proved a success.

We're pretty cautious about offshore because really, it's -- we look at it and say it's the New Zealand Apple ecosystem that matters most of all. And you can earn a few royalties offshore, but the return to New Zealand and your community can be 20x that if you get it right. I guess you've got PVRs protecting varieties and they can be hard to control in some countries like people do sometimes take water and do things.

What we fall back on is we're very reliant on things like trademark. So Dazzle is a very -- is getting to be a very established brand and market, and we can protect that through the world really strongly and a lot of countries we can protect PVR very strongly. So we're in a very strong position, but the New Zealand Apple ecosystem is what really matters to us. That's it.

Thanks, Andrew.

No more questions online.

No more questions online. Okay. Look, I'll just answer a question that came in via e-mail, Steve, I think, which is important. Look, we -- during the year, we applied to have a closed orchard, which is situated in Hawke's Bay, to be -- we applied for it to be included in what's called the Hawke's Bay Regional Council future development strategy.

And so there was a block of land that we thought might be suitable for which industrial use was -- it's one of our orchards. Look, that application was declined. And so that proposal has been put on hold and that's not going to happen.

So at this stage. We've committed to some adjoining landowners to come back and talk to them at any stage if we were to try and progress that project again. But look, they have asked me to address the question in front of you here today and look, I've committed to them personally.

We have visited them with Andrew on Easter Monday, committed to them personally to sit down around the table with them if we decide to progress this application further at this stage. So I just want to raise that and have it on the record. Thank you, Steve. Any other questions in the room, if there are no more online?

Okay, ladies and gentlemen. That concludes our discussion on the items of business and as there doesn't appear to be any further business for discussion, that brings us to the end of the formal business for Scales Corporation 2026 and Shareholders' Meeting. I'd like to thank you all for taking the time to connect with us today, whether it is online or in person. And I'd now like to declare the meeting closed.

We'd just like to invite all of you here today to join us for some refreshments and some food outside. Chance to have an informal discussion with any of the directors or management team here today. So please feel free to join us I think Andrew Hepinster brought some of his tasty treats up. There might be some apples out there for you to take home as well, and we look forward to the conversation out in the foyer. Thank you very much.

Thank you for standing by, and welcome to the Scales Corporation Full Year Results Call. [Operator Instructions]

I would now like to hand the conference over to Mr. Andy Borland, Managing Director. Please go ahead.

Thanks, everybody. I'd like to welcome you to the Scales full year results announcement for the year ended 31 December 2025. With me is Steve Kennelly, Scales' CFO; and Geoff Smith, Scales' Chief Operations Officer. Earlier this morning, we lodged our results with the NZX, including a presentation pack that we'll base our comments on during this call. We'll run through the slides, and then we'll take questions. If you have further questions after the call, we'll be available for the rest of the day.

Our agenda is as shown on this slide, we'll go through the Slide 2, the FY '25 results and performance followed by our outlook for FY '26. First, a summary of FY '25's results. I'm pleased to announce that the group delivered record results across all earnings measures. Underlying EBITDA was $137.6 million, an increase of 50%. Underlying NPAT attributable to shareholders was $61.8 million, an increase of 82% and reported NPAT attributable to shareholders was $101 million, an increase of over 200%. There were strong performances across all our divisions. Horticulture produced an outstanding result. There was strong performance from Global Proteins and another record result from Logistics. We'll go into more detail on the following slides.

A few of our key numbers are highlighted here on Slide 6. A couple of items of particular note. Revenue was $900 million, an increase of 54% and Mr Apple exported 3.7 million TCEs of its own grown apples, which is up 21% compared to 2024.

I'll now pass over to Steve to run through the financial results for the year.

Thank you, Andy. As Andy mentioned, the group achieved record results across all its performance measures driven by the growth strategies across the divisions. There was also a positive impact from our increased shareholdings in our joint venture businesses. You'll also note that our prior year comparatives have been restated, which is due to an increase in apple valuations in FY '24 of approximately $6 million. The net impact of this restatement at an underlying NPAT attributable to shareholders level was around $200,000.

Our 5-year performance for underlying NPAT attributable to shareholders, underlying EBITDA and revenue are depicted on Slide 9, showing the increases in those measures compared to prior years. As Andy mentioned, there was growth in underlying EBITDA across each of our 3 operating divisions. Global Proteins generated a solid result with Shelby, Meateor Australia, Meateor New Zealand and Fayman International performing particularly well.

Esro Petfood continued to progress through its start-up phase. The Horticulture division produced an outstanding result through increased volumes, prices and improved variety mix. This result was also enhanced by the acquisition of the Bostock orchards in FY '24. And lastly, Logistics produced another record result driven by a significant increase in volumes.

Our divisional performance is summarized in the table on Slide 11. In addition to its 73% increase in earnings, the Horticulture division also generated a pleasing increase in underlying EBITDA margin. And the 5-year underlying EBITDA for each of the divisions is shown on Slide 12. As you can see, the prior year comparatives for Horticulture have been restated, but there was no restatement for either Global Proteins or Logistics.

The group's overall financial position and net debt reflect the investments made in Global Proteins joint venture businesses during FY '25. However, our financial position still allows for further investment opportunities. The most significant cash outlay last year were those required for our joint venture investments. Other significant expenditure included dividend payments, including those to minority shareholders and CapEx.

I'll now hand back to Andy.

Thanks, Steve. As we've already touched on, 2025 was another successful year for transactions and increased investments in Shelby, Meateor Australia, Fayman International and ANZ Exports. This takes our -- the Shelby investment takes our shareholding to 67.5% and ANZ Exports to 85% with Meateor Australia and Fayman International now being fully owned. Due to these investments, we've increased the Global Proteins FY '27 underlying EBITDA target from $70 million to $85 million.

The benefits of these increased investments are noticeable in the division's overall results with increases in revenue, underlying EBITDA and underlying EBIT compared to last year. There are also increases in both pet food ingredient volumes and edible proteins volumes of 9% and 10%, respectively.

In terms of the businesses within the division, Shelby had a solid performance whilst it has transitioned to a new toll processing facility. Meateor Australia and Meateor New Zealand performed significantly ahead of forecast with margins up on expectations. Fayman International had a strong performance, increasing sales to both Southeast Asia and U.S. markets and Esro Petfood continued to move through its start-up phase whilst also transitioning to a new processing facility.

Revenue and margin per kilogram of volumes sold within pet food ingredients business have been influenced by changes in business mix, which resulted in a small decrease in revenue per kilogram. However, improved margins across Meateor New Zealand, Meateor Australia and Esro resulted in increased underlying EBITDA per kilogram.

There's been excellent progress on the 9 key strategic projects that support Global Proteins growth target. Its new processing plants in the United States increased volumes and the Netherlands facility producing -- is producing high-quality product. The U.S. blending project is operating successfully and the first U.S. in-plant collection and cooling system is functioning well. Pleasingly, the second new in-plant collection and cooling system in the United States was commissioned in December 2025, which was ahead of schedule. In terms of ongoing projects, we're currently establishing a joint venture to trade fish and poultry in the U.S. The feasibility study for a second European site is progressing, and we're close to finalizing the options for additional processing capacity in New Zealand. Each of these initiatives are expected to contribute positively to the Global Proteins earnings target in future periods.

Turning to Horticulture. As previously mentioned, 2025 was an exceptional year for the Horticulture division with increased volumes, higher average prices and an increased proportion of premium variety volumes such as Dazzle and Posy. The addition of the Bostock orchards helped to fast track these factors. Profruit continued to perform extremely well, delivering another excellent performance aided by strong sales prices in its export markets. Trading business, Fern Ridge Fresh also had a very strong year.

Mr Apple's own grown export volumes increased 21% compared to last year with external grow volumes increasing 49%, helped by very good growing conditions and the integration of the Bostock orchards. Premium apple volumes accounted for 74% of export apples sold, a slight increase on last year with significant growth in Dazzle and Posy apples. Sales into the Asia and Middle East market also grew compared to last year with marketing sales promotions and customer support in these key markets supporting the volume increases. I'll touch on those activities soon. As I've mentioned, Profruit delivered an excellent result with whilst volumes of juice concentrate sold returned to a more normal level.

On Slide 22, the graph on the left of this slide illustrates the level of increase in premium apple volume sales last year. You also see that 2025 volumes are significantly higher than all previous years, 16% increase higher than 2021, which was our previous record year. The graph on the right shows the upward trend of the proportion of premium apple compared to traditional apple sales. This aligns with our strategy positioning us in the right direction to meet our target premium volume percentage.

The forecast percentage of premium variety apples is depicted on the current Slide 23, along with our forecast volumes. In addition to integrating the Bostock orchards and continuing our orchard redevelopment program, we're continuing to develop new exciting premium varieties, which have been grafted on to existing trees and are expected to supply a new wave of growth. We achieved increases in pricing for both our premium, traditional variety apples. This was helped by strong demand for apples in our key markets and by the Bostock orchards, which performed ahead of our initial expectations. Favorable exchange rates were also a positive factor.

Pricing also benefited from targeted marketing and promotional activity, which leads me nicely on to the next slide, 25. A selection of consumer marketing activities carried out by our Mr Apple team are shown on this slide. This included relaunching our Tmall store, the Alibaba business-to-consumer online marketplace launching Mr Apple channels on RedNote and Douyin, 2 Chinese social media and e-commerce platforms, continuing to provide Dazzle sponsorship of activity of active events.

We continued with metro advertising in Shanghai, Guangzhou and Taipei to reach busy commuters and launching a store locator on Mr Apple's official WeChat page to help consumers find their apples with our retail partners. The team more than doubled Mr Apple's branded presence in retail stores across Southeast Asia markets, increased its in-store point-of-sale material tenfold and tripled its in-store sampling sessions.

Moving on to Logistics. For the second year running, Scales' Logistics produced a record result while both ocean freight and airfreight volumes were up on last year. Airfreight showed significant 81% increase due to strong volumes from the dairy sector and a positive cherry season. The division also benefited from strong apple volumes. This helped logistics. Scales' Logistics produced a 21% increase in revenue and a 10% increase in underlying EBITDA.

Moving on to capital management. Our overall group ROCE was 14.6% compared to a restated 14.3% last year and a group target of 12.5%. Horticulture and Logistics produced excellent increases in returns, whilst Global Proteins ROCE was impacted by the investment in Meateor Australia, Fayman International and ANZ Exports. As is the nature of the business, the Horticulture division accounted for the majority of CapEx during the year. Projects of note included the ongoing orchard redevelopment program and our new high-pressure apple washer at Whakatu packhouse, both of which are expected to improve margins.

In addition, we've undertaken a significant upgrade to the RSE accommodation of Mr Apple. This investment included additional portacoms sleeping and dining rooms as well as additional furniture and whiteware. Other significant pieces of CapEx included the second in-plant collection and cooling system in the United States, as mentioned earlier.

Now on to sustainability. Sustainability continues to be a key focus for us. And during 2025, we completed a refreshed double materiality assessment in order to understand our stakeholders' priorities. In terms of people, we undertook an engagement survey for all our New Zealand businesses with our plan being to roll this out globally in 2027. We continue to integrate health and safety and well-being into our businesses and have developed an improvement road map covering the next few years. In terms of environmental projects, we're looking forward to releasing our climate statement in April, which will be our third report of this nature.

During the year, an assurance exercise was undertaken to confirm our Scope 1 direct and Scope 2 indirect greenhouse gas emissions data and the analysis of Scope 3 raw material emissions was progressed. And our regenerative planting trials at Mr Apple, which aim to restore soil health, increase biodiversity and enhance ecosystem function has continued. And pleasingly, these show early indications of improved soil health and fruit quality. We look forward to sharing more details of these and other projects in the sustainability section of our annual report as well as in our climate statement.

Moving on to governance. At last year's Annual Shareholders Meeting, Alan Isaac signaled his intention to retire from Scales' Board prior to the end of his current term, having secured a replacement director. Alan retired in October last year. Alan was a major contributor to Scales' governance program, serving on the Board for over 11 years. Not only was the Chair of the Audit and Risk Committee Management Committee, but he also chaired the Due Diligence Committee as part of Scales' listing process. With his accounting and finance background, he provided excellent financial knowledge and wise counsel.

In Alan's place, we're pleased to welcome Paul Munro to the Board in October last year. Paul also has a significant accounting and finance background as well as extensive governance experience from a wide range of public and private entities. We also announced that Steve Kennelly is stepping down as CFO in May of this year with Ben Washington replacing him.

Steve has been with Scales since 1993 and a variety of accounting and finance roles being appointed as CFO -- Scales' CFO in 2011. However, we are pleased to say that Steve isn't leaving us completely. He'll take up a new role as Company Secretary. And we're pleased to welcome Ben Washington in Steve's place. Ben will start in June, joining us from KMD Brands, where he's held several senior leadership positions, most recently as CFO of Kathmandu.

Lastly, our outlook for 2026. In terms of the overall group outlook, we're pleased to confirm our previously advised guidance range of underlying NPAT attributable to shareholders of between $50 million to $55 million. Underlying NPAT and underlying EBITDA also remain as previously advised.

In terms of the divisions, we expect Global Proteins to continue to perform strongly and realize the benefits of its increased joint venture investments. In Horticulture, picking and packing started for the 2026 apple season with a crop of around 3.5 million TCEs forecast. Pricing is expected to be positive, impacted by a number of factors, including favorable foreign exchange rates. Profruit is currently experiencing positive demand. We expect Logistics to continue to contribute positively and are pleased to note that it's continued to experience strong air freight demand in the year-to-date.

We're happy to take, obviously, questions from now on.

[Operator Instructions] And the first question comes from the line of Rob Morrison with Craigs.

Congratulations on a record result and best of luck for the new role, Steve. I'd like to start off. So obviously, the your NPAT to shareholders for next year is down a fair amount, and it looks to be driven by normalization of Horticulture. So I'd like to assess how sustainable the Horticulture gains are. And kicking off with that, I know we've got a few headwinds to -- what are the headwinds? One of them is some of the land is going to be redeveloped in [ Hort ] orchards. So what reduction in land area are you assuming for next year roughly?

Look, none really. We've been able to work through the process of the redevelopment without material reduction in production, if you want to call it that. Because don't forget this new redevelopment done in prior years is coming on to maturity.

Yes. No, that makes sense. And so then there's this 5% guided fall in volumes. So I guess, therefore, you're assuming about a 5% fall in yield per hectare. So it's driven by falling yields, right?

Yes. Look, we use a sort of a rolling 5 years average model for our yields, and it's proven to be pretty reliable. And so I mean last year was a significant crop in terms of yield per hectare. So this is probably just a normalization to how we normally predict our yield.

Yes, yes, that makes sense. I guess -- yes, I'm not too sure how one season would inform the other. But put another way, so the harvest has started in late Jan. And I know it's really early days, but the exports are tracking very strongly. So to date, from what you've harvested, are you seeing this assumed reduction in yield?

Probably not. But as you rightly pointed out, Rob, there's a long way to go. We don't try and sort of forecast the results until we've got a lot more certainty. But it is still the end of February.

Yes. Fair enough. And just a little bit more color on the pricing. So you say you've assumed positive pricing for Hort. And I think the premium varieties have been growing high single digits over the past 5 years on average. So would you be assuming high single digits again? Or does that normalize to something like inflation?

Yes. Look, we generally -- I mean we're obviously cognizant of that currency cover we've got. We're cognizant of how the markets are going and color and size also contribute. So the size is down slightly this year compared to last year's bumper crop. So that might have a small impact on pricing as well. But at this early stage, we are pretty positive about how the markets are going.

Excellent to hear that. That's all super helpful. Just transitioning to Global Proteins. So the second in-plant collection and cooling system in the U.S. has been commissioned ahead of schedule. And obviously, that was the key driver of the big uplift in Shelby in FY '26. But I know that you've kept Shelby or the implied guidance for Shelby flat. How should I reconcile that? Is there a bit of weakness elsewhere? Or is it just conservatism?

I don't know if we've actually guidance for Shelby. We've guidance for Global Proteins, and we do see a bit of a positive uptick in the U.S. I mean there's no mucking around with tariffs. So that's a big plus for the Shelby business. But yes, look, we're seeing a positive uptick just through the normal trade, but the increase in net volumes coming from the new plant as well.

Okay. But just -- so just on the Shelby, you can kind of work it out because you guys guide to NPAT and then also NPAT to shareholders and kind of see what the payments to Shelby are and then use the percentage ownership you have in that to work it out. But so just -- it sounds like maybe things are tracking a bit more positively than you thought when you gave guidance in December, Shelby. Is that right?

Yes, possibly. And yes, well done for spotting that.

I'll squeeze one more in, if I may.

Sure.

Cool. So Tyson, obviously, a massive meat processor in the U.S., they shut down this big plant in Lexington. And it looks like that's about 5% of daily U.S. cattle slaughter, but it's kind of in your neighborhood. And obviously, that 5% will be magnified quite a bit for that area. So long story short, it looks like there would be a decrease of supply. Are you expecting to see some pressure on Shelby margins from that going forward?

No. Look, we generally can replace supply. I mean supply for beef in America is tight. The cattle killer is down across the board. That's pretty well known. So it's -- we're -- I guess, having diverse product range even within beef like the various offal categories and MDM, we can sort of move around, if you like, and be quite flexible to source product from either other plants or the different hearts and other organs. So it's certainly -- yes, we did notice that, that plant is shut, but we're not seeing it impact our financial position right at the moment.

Cool. That's wonderful. Congratulations again.

The next question comes from the line of Guy Hooper with Jarden.

Congrats on what was a really strong result. Can I just pick up a little bit more on the guidance settings and how you set that initial guidance, particularly within Horticulture. So if you assume sort of an average 5-year for the yields, what sort of -- what goes into the pricing assumptions for that fee guidance?

Yes. So end market, as Andy said, we use a rolling average. So there's probably a little bit of normalization in market prices assumed. But then we've got tailwind in FX, and we think freight is probably about the same. So that's the sort of, I suppose, the net picture pricing.

Okay. And when you say Logistics' expectation is to contribute positively for FY '26. Is that -- are we to assume year-on-year growth? Can you sort of talk about where that might be coming from, especially if we assume normalization and sort of yields?

Sort of talking sea freight here -- say logistics? Sorry, if you're talking sort of logistics and the cost of freight, we would see that being pretty similar to last year. Yes.

Yes. I mean the Logistics business.

Yes. So sorry, look, we can see some reasonable growth coming in that business. It does -- there is -- the cherry season is not as good as this year, hasn't -- wasn't as good as last year, but there's other products that are looking quite strong that will offset that. So we would like to see the business -- we expect to see some good reasonable positive growth in the earnings.

Yes. Can you just maybe talk a little bit even a sort of high level, what run rates are looking like within some of those Global Proteins divisions. It looks like, as you say, Australia has really ramped up to the back end of the half. And then Shelby was flat year-on-year, but you had some sort of transitioning going on. Can you sort of talk about the moving parts within those different businesses into '26?

Look, I think there's sort of a bit of change within the various areas, but look, pretty positive overall. We're sort of seeing good trading performance out of the Fayman International business. Clearly, the pet food out of Australia has had the tariff impact. So we're working through that. I just -- if we believe the latest announcement, the 10% is going to 15%. But we're having pretty positive discussions with our customers already on that. And yes, look, Shelby is a fantastic business that -- and it's got a little bit of growth coming this year, having had very, very good performance over the last 3 years.

Okay. And maybe just one last one for me. I think part of the rationale from going earlier on acquiring the additional stakes in the Aussie JVs was just around a better alignment and getting, I suppose, fast tracking some of the opportunities that you saw. Can you talk a little bit about how those are playing out and what those might look like?

Yes. I think there's just a bit more -- able to be slightly more collaboration between Meateor New Zealand and Meateor Australia. There's a bit -- we're able to support each other slightly better. I mean what -- well we're working together anyway. So it was sort of an incremental change there. On the other side of the trading business, again, it was just good to get the continuity there of the business and the relationships back to Meateor Australia as well with the meat companies. So we felt like it was a good move to bring that into the grand plan, if you want to call it of where we're heading with this global protein thing. In the end, we want to have a global footprint possibly with the same brand.

The next question comes from the line of Matt Montgomerie with Forsyth Barr.

Might start on the Global Proteins project on the slide deck that you've presented today, it looks like there's a few changes. So I might ask sort of 3-part question to start. So firstly, on the second in-plant cooling system in the U.S., noting ahead of expectations. Maybe just how that's come about? Is that a better market demand generally for pet food in the U.S.? Or is it customer-specific pull forward of demand?

And secondly, on Europe, I know you've paused the feasibility study there. Just any comments you could give. And then thirdly, sort of the establishment of a JV in the U.S. is new information today. So just any more color you can give there?

Yes. Look, on the second in-plant calling, it was just a -- it was -- the equipment was put in slightly ahead of schedule. So that got us off to a positive start. We really only -- we were forecasting a start from the 1st of Jan, and that hit the ground running, if you want to call it that, but that was just positive. I'll do the fish and poultry first because I forgot the second question already.

Europe, yes, look, we continue to investigate the second plant in Europe, but it has taken us longer to get the transfer out of -- remember, we started in [ Helchteren ], Belgium. So we've gone back to the Netherlands, which has been a net positive move because we're right beside our business joint venture partners facility there. So that is -- Europe is taking longer to get to where we want it to be, but we're still very positive about it, and we are still investigating the option of a second plant up there.

On the fish and poultry, we just sort of teamed up with a younger chap who's been in the industry with a sort of a supporting team and ourselves and Brett Frankel from Shelby and Michael Tierney, this guy's name, have done a 3-way joint venture to get us started trading in fish and poultry. Obviously, we've looked at various different avenues to get into that sector, and we're just, I guess, taking it slowly. It was virtually a start from scratch business and just getting us to understand the dynamics of a bit more of processing or trading at this stage, both fish and poultry.

And just on the last part there, Andy, so it won't be material in FY '26 and maybe not even '27, '28 sort of...

Yes. It's a slower burn. Yes. And it's a good way for us to get work with these guys. And ultimately, it will be a good business, no doubt.

Then just on Profruit in FY '25. So I appreciate you've given us volume numbers, but I might have missed it, but I can't see what the either EBITDA or NPAT contribution was in FY '25.

The same as the prior year.

Okay. Perfect. Okay. And then just on Horticulture, maybe I'll try to ask Rob's question in a different way. So I think if we go back 12 or 18 months or so ago, we were talking about maybe $55 million in EBITDA post IFRS, including Profruit. You've obviously just done $65 million. Is it fair to assume or maybe glean that number that you gave us a year or 2 ago is possibly on the conservative side if we look out 2 or 3 years and sort of normalized conditions?

Possibly. Possibly conservative. But we do -- we haven't moved our modus of forecasting that business. Yes. So it's -- obviously, we like to get the yield right and the markets and the pricing remain positive, but we still got a long way to go in this season.

Yes. No, that makes sense. And then, Steve, one for you. Just on the net debt, I suspect myself and the other analysts maybe just missed it at the time of the Australian acquisition, but your debt came in meaningfully higher than what at least I was expecting. And it looks to me there's some debt acquired with the Fayman acquisition. Is that just like a working capital facility and is there any seasonal component to it? And then maybe if you can try to give us a steer on where you think net debt will be at FY '26 on your current guidance?

Yes. I think in the pack we released when we did the acquisition, we were guiding to $57 million net debt. We ended up at $84 million. And yes, you're right, it's an increase in working capital. So there was an increased level of trading towards the end of the year. So -- and working capital responded to that. It's already started to work its way sort of back out. And it wasn't only in the Fayman and Meateor Australia business. We had slightly elevated levels at Mr Apple as well. So as far as the guidance for the end of this year, forecast currently would say something around $60 million. But yes, we still got a bit of work to do on that.

Yes. That makes sense. And then, Andy, just one on Shelby revenue in FY '27, and this is just sort of circling back to the initial targets you gave us a couple of years ago now, which I think was $330 million in revenue in FY '27. And that was basically all Shelby revenue, obviously, because of the ownership state at that point. Is that still roughly the right number we should be thinking about? Obviously, it sounds like the projects are going well. You're guiding for solid growth in Shelby this year.

Yes. I'm probably not as close to the revenue number as perhaps you're spot in there specifically. But I think on our target, revised target of $85 million EBITDA in 2027, we've -- that's been restated post the Aussie transactions, and we remain confident about that number. And Shelby has got, as you've spotted, a contribution to that growth, but we remain confident about that -- the assumptions there.

Yes. Do you think -- is there a world in which you do it in FY '26? Like you're guiding to pretty strong Shelby growth. It sounds like the Aussie business is going well and then the rest are pretty small contributors now.

It's February, Matt.

There are no further questions at this time. And I'll now hand the call back over to Mr. Borland for closing remarks.

Yes. Look, thank you very much, everybody, for participating in the call and your support. Yes, we're obviously very pleased with the results and proud of the team's effort across the globe. So yes, thank you. And happy to have calls later if anyone's got anything else to discuss. Thank you.

Thank you. This concludes today's conference. We thank you for your participation, and you may now disconnect.

Thank you for standing by, and welcome to the Scales Corporation Half Year Results Call.

[Operator Instructions]

I would now like to hand the conference over to Mr. Andy Borland, Managing Director. Please go ahead, sir.

Thank you. Good morning, everybody. Welcome to the Scales interim results announcement for the 6 months ending 30 June 2025. I'm calling in from Melbourne, meeting the teams and visiting our plant here today and tomorrow. And back in Christchurch, we've got Steve Kennelly, Scales' CFO; and Geoff Smith, Scales' Chief Operating Officer.

So earlier this morning, we lodged our results with the NZX, which included a presentation pack and we'll base our comments on that presentation during this call. Steve and I'll run through the slides and then take questions. An agenda is provided on Slide 2.

Moving through to the overview on Slide 4. This slide provides an overview of the first half of 2025. I'm pleased to say that Scales produced a very strong first half performance, which is supporting a further lift in the full year FY '25 earnings guidance. I'll provide more information about that later. So underlying EBITDA was $86.7 million, up 43%. Underlying NPAT was $56.9 million, up 48% and underlying NPAT attributable to shareholders was $48.9 million, up 72%. These results were a consequence of all our operating divisions successfully executing their respective growth strategies and in particular, both Horticulture and Logistics producing outstanding results.

As a result, the directors are pleased to advise a further increase in Scales full year FY '25 earnings guidance from that advised in June. Underlying NPAT attributable to shareholders is now expected to be between $45 million and $50 million.

So Slide 5, each of our divisions illustrated its respective strengths during the first 6 months of the year. Global Proteins continues to progress its strategic growth goal. Meateor Australia had a particularly strong first half performance, and we're pleased to increase our investment in Shelby. Horticulture is realizing the benefit of the long-term strategic investment into premium apple varieties that are targeted our key markets of Asia and the Middle East, with this strategy being fast tracked following the Bostock acquisition. And Logistics has benefited from a strong horticulture season.

I'll now pass to Steve, who will run through the financial results for the first half of the year.

Thanks, Andy. Slide 7 summarizes the financial performance for the group for the first half of 2025. As Andy previously mentioned, the group generated significant increases in underlying earnings compared to the same period last year. Pleasingly, reported earnings have also shown an increase in all areas. In respect of the performance by division, Global Proteins delivered another steady result with underlying EBITDA of $29.7 million, which was consistent broadly with both the first and second half of 2024. The Horticulture division generated an exceptional result with an underlying EBITDA of $53.2 million, up 77% compared to the first half of last year. This was a result of both increased apple volumes and positive pricing due to variety mix and apple size.

And Logistics produced an excellent result of $6.1 million, which was an increase of 60% compared to the same period last year, again, due to an increase in volumes.

The next slide summarizes our financial position. There was a decrease of $14.4 million in net debt to $67.5 million as at 30 June 2025. This largely reflects income from earnings and proceeds from the sale of Orchards to Craigmore, offset by the cost of our additional 7.5% investment in Shelby. And I'd also like to note that the settlement of the sale of Whakatu coolstore will take place this month.

I'll pass you back to Andy.

Thanks, Steve. As Steve mentioned, underlying EBITDA for Global Proteins was consistent with both the first and second half of 2024. However, underlying NPAT attributable to shareholders increased 14% due in part to the increased investment in Shelby. There were increases in both petfood ingredients and edible proteins volumes, as previously mentioned. Both Meateor Australia and Fayman produced strong first half performances with Meateor Australia, in particular, being ahead of forecast. There was a slight increase in the overall margin per kilogram sold of petfood ingredients in the 6 months to June 2025, whilst revenue per kilogram remained steady.

Moving to Slide 13. This current slide provides an update to the 9 key strategic initiatives within the Global Proteins division. Those on the left-hand side of the slide are either completed and operational or close to completion, such as the Netherlands processing facility that was commissioned in the first quarter of this year. The projects on the right are ongoing, and we'll continue to bring you up to date as these progress.

Slide 14. As previously mentioned, the Horticulture division delivered a significant increase in earnings with underlying EBITDA up 77% on last year. The division benefited from increased volumes and improved variety mix and apple size. Mr Apple's total own grown export volumes are forecast to be 3.7 million TCEs, which is a projected increase of around 21% on 2024. Horticulture continues to experience growth in premium apple volumes with the proportion of these apples increasing to around 75% this year, up from 72% last year. This included significant increases in our Dazzle and Posy volumes, which are forecast to account for over 25% of premium volumes in 2025. We expect the total premium variety volumes will continue to grow in future harvest as a result of maturing plantings.

The Asia and Middle East markets are expected to account for around 85% of total fruit sold, and we are anticipating strong demand in Asia due to a short supply -- due to supply shortage and the upcoming mid-autumn festival. Profruit volumes reflect a more normal year compared to the overperformance of 2024 with continued strong sales into the U.S.

Moving on to Logistics, which produced an exceptional result underpinned by increased freight volumes. Its underlying EBITDA of $6.1 million was up 60% on the first half of 2024. The division experienced high demand for sea freight, particularly from the Horticultural sector and a significant increase in air freight volumes, particularly across dairy. Our new Auckland coolstore and warehouse has also helped to facilitate this lift in volumes.

Moving to our sustainability update. Sustainability continues to be of high importance across the group and having successfully delivered on our 2024 sustainability milestones, we're now developing new targets for the period ahead. A materiality assessment is underway to help us better understand key topics and issues for all of our stakeholders, and we're refreshing our sustainability strategy to allow us to build a longer-term sustainability road map. Specific projects include improving our Scope 3 emissions, implementing an enhanced parental leave policy to support our staff and reviewing our decarbonization work to help us set our next emissions targets.

So the FY '25 and future outlook. Lastly, I'd like to update you on these 2 matters. As noted earlier, the directors are pleased to advise a further increase in the FY '25 guidance range of underlying Net Profit After Tax Attributable to shareholders to between $45 million to $50 million. In providing this guidance, directors note the following: Mr Apple has 18% of its export crop to sell, which compares to around 14% this time last year. We remain cautious in Global Proteins due to the current operating and geopolitical environment. However, we are confident with the medium-term and strategic growth initiatives that we have in place.

So the pathway ahead. On this slide, we have summarized both where we are at currently and what we see as the pathway ahead for Scales. Where are we at? The recovery from Cyclone Gabrielle is complete with our long-term strategic investments, including the Bostock transaction, delivering results. Our revised guidance will increase to increased -- our revised guidance will give rise to increased dividends and our divisional strategies are ensuring enhanced diversification of earnings.

Going forward, we've identified key drivers in terms of future growth, including the following: continued diversification of earnings, a focus on the expansion of Global Protein and Logistics, leveraging our established global footprint. Our global expansion will be facilitated by the supply chain excellence within the group, and we anticipate ongoing opportunities for growth through increases in our joint venture stakes. We're excited for the future and what it holds.

That concludes today's formal presentation. However, please take note of Appendix 1 of the presentation, which provides additional financial information and reconciles underlying earnings to reported earnings for the group and each of our divisions.

We are now happy to take questions.

[Operator Instructions]

And our first question comes from Guy Hooper with Jarden.

Well done on a strong result. Can I just start -- there's quite a lot of moving parts, I guess, within the Global Proteins business. Can you sort of talk to how maybe some of the projects have been either completed at the back end of '24 and into '25, how well they're performing? And I guess, what the expectations are as that capacity Scales and the earnings contributions over the next, say, 12 to 18 months?

Thanks, Guy. Look, we -- obviously, we've noted the very strong performance of the new plant in Melbourne. So that's -- that was -- that project has gone really well and now contributing to earnings. The second toll processing plant in North America is running and operating very well. So strong -- it's doing as we expected it to do. And the plant in the Netherlands is sort of -- it's -- because we moved it from Belgium back to the Netherlands, it's sort of been delayed, but it's commissioned now and going through that phase towards profitability.

So we're very pleased with all of those major projects where they're heading and they're contributing to EBITDA as expected and will be all, including the Netherlands plant, hopefully, by the end of this year. And obviously, the projects that are ongoing are working through the system going well and expecting to contribute in 2026.

Great. Another upgrade to the guidance range. Could you just sort of talk as to what is factored in there? I know I think you mentioned around some caution around macro and global trade challenges. I mean, have you seen to date, what sort of impact have you seen within the Global Proteins side? And what should we be looking for as the key risk factor here?

Look, I think it's broadly in line with what we're doing for the second half of '24. But I guess it's just a cautionary position around the uncertainty that's created by the tariffs, for example, I mean, we're working through that. I mean, clearly, Australia has got a small advantage now on New Zealand with the 10 versus the 15. And there has been disruptions -- slight disruptions in markets like Thailand because they haven't settled their tariff agreement yet or if they have, it's at a higher rate. So it hasn't been plain sailing, but the business has gone -- we're still very happy with the way the fulfillment -- the Global Proteins division is operating and the contribution it's making financially is strong.

Okay. Great. And is that the main risk that's sort of factored into that guidance range?

Well, I think that -- and if you like, just the demand for petfood is -- it's probably not as going at the same strong CAGR that it had been going, but we have no evidence that suggests that it's not going to, if you like -- bounce back, if you like, or improve going forward and hold that steady CAGR growth of around 6.5% that looks like it's holding in there.

Okay. And just one last one for me. I mean you emphasized the growth over the next couple of years within Proteins and Logistics. I mean we know the projects there in proteins. Can you talk a little bit about what expansion within Logistics looks like?

Look, we've just been consistent in saying we really like the industry. We like that freight forwarding model that we really scaled Logistics is really good at, and we are actively looking for opportunities to ramp that area up and particularly with more exposure to the global operations that connect up with how we operate globally with our apples and our petfood. And in all of those 2 areas, we've been able to pick up freight from other Horticulture businesses and other petfood businesses. So it's sort of a multiplier effect, if you like, if you can add Logistics to your export solutions.

Our next question comes from Matt Montgomerie with Forsyth Barr.

Just maybe one for Steve on guidance. Just I'd be interested if you could just provide a bit more specifics around where you see Hort EBITDA and NPAT for the year. Obviously, there's not much fruit to be sold as you've outlined. So I assume there's not too much variance in that. So just, I guess that would be a useful way of framing the second half and the guidance upgrade of just put more specifics on Hort earnings for the year.

Sure. We probably see reasonably flat second half, if not slightly down. There's been a couple of changes between last year and this year. So we've got more fixed cost and probably some -- just some more variable costs coming into the second half this year than last year. So we wouldn't see a repeat of last year's second half, and that's at an EBITDA level.

Okay. That's useful. And then just sticking on Hort, again, if we go back to Feb, I think we were talking 3.7 million TCEs in FY '27 and sort of post IFRS EBITDA of maybe $50 million to $55 million. Like I know this year has been, I guess, abnormally strong because of the growing season. But has, I guess, another 6 months or a strong growing season altered your view of sort of the medium term or the next few years in Hort?

I'll take that one, guys. Look, I think we're pretty -- we're very happy, I guess, with the performance of the business. And the strategy of growing -- well, a, having access to the varieties that we've invested in and how they performed in the market have really met and exceeded our expectations. So if you like, people talk about, oh, we're going to do this strategy or that strategy. we're sort of saying, well, we've done this strategy and it's worked. The premium -- selling premium variety apples into Asia and the Middle East is a good model, a successful model, especially spread across a diversified market range. It's not just one market.

And we are lifting our volumes in those premium apples. So I think we sort of -- the goal we set wasn't sort of super cool, super -- it was achievable, and we're on track to get to it. But we're not lifting it above that, those ranges that we've set at the moment.

That's useful. And maybe, Andy, sticking with you, just on Proteins again, for the full year, I think we were talking to maybe flat to slight growth in the year overall. Has there been any change to that thinking? Like it feels like the underlying business stripping out Meateor International may be going a little bit better than expected. But yes, just any further color on Proteins earnings for the year?

Yes. Look, I think you're on the -- what you're saying is about right. I mean that's where we're heading is steady in probably a pretty patchy market. So we have had, if you like, the task of offsetting the reduction in Meateor International, but I mean that's sort of gone through pretty seamlessly. And the businesses are all going well. It's just a matter of keeping going on the execution of the various projects, Matt. We'll be broadly in line -- the result is going to be broadly in line with the second half of '24, we feel.

Yes. And just I suppose on the path to 70 in FY '27, would we still be expecting, I guess, higher growth in '27 over '26 than '26 over '25, i.e., just a little bit more back-end loaded?

Look, I think we've certainly got plans for solid growth in '26 because of the second in-plant cooling system kicking in. So that's going to be a good lift up for us. And I would say that momentum would continue into '27. But I don't think we have backloaded it totally. I think it's more like a growth in '26 and growth in '27.

Yes. Okay. That's useful. And I'll hog the mic and go one more. Steve, just on net debt for the year, just where you think it will land, I suppose, if we assume the midpoint of your guide?

We're looking probably at a slight increase on last year after the -- obviously, the Shelby acquisition earlier in the year. So we're probably around that $20 million mark net cash.

[Operator Instructions]

And we'll go next to Rob Morrison with Craigs.

Congratulations on a very good result. So I think earlier, you spoke to hopes that the growth in the petfood market would get back to, say, 6%, 7% that it had been seeing a few years ago. And I think more recently, it's been, say, low single digits. What's going to drive that? And what's the timing on that?

Well, that's sort of like macro trends. I mean we're operating sort of an air niche within it. So I think -- I guess we're sort of -- we're seeing long-term prospects for pet ownership and petfood consumption holding at the numbers predicted. So there's no general downturn in petfood. I think there's probably just a bit of disruption because of what's going on in America. And once that settles down again, we would see growth heading back to the norms being predicted. And I guess how we operate within the sector is our opportunity to maybe outperform the sector growth, which we have been doing, obviously, over the last few years.

Okay. Sorry, just to be clear, what's going on in America. So the reason the growth has fallen from, say, mid-single digits to low single digits at the last data point is largely because of the tariffs.

Yes. Well, I think that just caused a lot of uncertainty. I mean, just being -- people being a bit more cautious right through from our customers right through to their customers.

No, that's fair. What do you see as the drivers of Global Proteins growth in FY '28 and beyond? Because obviously, we've got a great line of sight to FY '27. But from FY '28 plus, is it just inorganic opportunities? Or are there some projects on the horizon that will accelerate organic growth?

Yes, definitely both. We'll be doing both just growing the existing businesses, but obviously looking for further growth too because we just feel like there's more opportunity in the sector to provide better and more comprehensive offerings to our major customers. As we're looking at different species, as we're looking at different products within the range, I mean, there's a wide field to play in there.

Okay. Could you give a little bit more color if possible? You obviously mentioned species and customers, but is it as simple as just opening new factories and new collection systems? Or is there something else that needs to happen?

No. I think as we've sort of said before, with fish and poultry, we're early days on. I mean if we scale up in fish and poultry to what we've got in beef and pork, well, there's massive growth. We're just looking at various ways of entering those markets in a more, I guess, a more granular meaningful way. So yes, we sort of keep your eye on what we are doing for sure in terms of execution on the projects. But as you're saying, yes, there's a hell of a lot of opportunity out there to look at different species and/or different more plants.

We've got having early, early discussions about perhaps more plants, potentially one, and we've talked about the second one in Europe. It's still to be fully assessed, but there's also more plant opportunities in, I would say, America and possibly Australia. And we mentioned in the pack there a bit of internal growth in New Zealand as well. We're hoping to broaden our integration, I suppose, into petfood products in New Zealand as well and obviously off a smaller base given the size of the New Zealand business.

Okay. That sounds good. Could you -- do you know what the growth in pricing for apples was, both for traditional and kind of next-gen varieties?

Steve or Geoff, have you got that in front of you?

We were -- yes, we're certainly up on last year, both in premium and traditional. And I just -- I suppose, remind everyone that the apples this year were larger. So there's -- you've sort of got to be careful in comparing like-for-like. But no, we're certainly up on both premium and traditional in market pricing.

I think we're also obviously benefiting from a pretty good currency position and possibly improving freight rates. Is that right, Steve?

Yes. No, definitely on a currency basis, and that's going to continue on. We're pretty highly covered going out forward at favorable rates. So we get incremental benefit there. I think shipping rates are probably what we expected, but we're seeing towards the end of the season that a slight improvement in those as well. So certainly a grower return basis, an improvement on last year as well.

Okay. Great. And that year-on-year improvement in pricing, because I guess the bigger apple size was something of a one-off. How much of that year improvement was one-off from bigger apples?

It's a good question, Rob. I don't have an answer to that. Look, I think fundamentally, there's some underlying element of increase in pricing like-for-like, but certainly, the larger apple sizes do help as well. But I don't have a split for that.

No, that's fair enough. That was pretty specific. Final question. I think there's been another increase to tariffs since your last update. Could you just give us an overview of where the impact is and what the gross to net result is going to be going forward?

Look, I don't think we're really not going to get impacted for the rest of '25 because we've got -- this is really just petfood. I mean, directly, apples are a bit indirect. But from a petfood point of view, the increase from 10% to 15% is largely going to be, well, not shown up in '25 because if the product we're selling up there is already up there, so it's had its 10%, and they don't -- the tariff increase at 15% would be stuff leaving now, which wouldn't be maybe for sale until next year.

But it's -- for next year, we're in that pricing discovery stage now of finding out what the market will take and then talking to the meat packers about what they'll sell for. So we're hoping to just see that net itself out, if you like. And with apples, it's really about disruption of other markets. And you probably -- with American fruit not ending up in China, for example, that creates a bit more demand. And so yes, it's choppy, but I don't think it's going to be a dramatic impact on the Scales result, both for this year and/or going forward.

Our next question comes from David Oxley with ACC.

Could I just ask quickly about Shelby? If I've got the math right, and I might not have done given it's a bit more complex this year due to the increase in stake partway through the half. But it looks to me like Shelby in its entirety was slightly down versus prior year. A, is that broadly correct? And if so, anything to -- any color to add as to why that might be?

Steve, do you want to take that one?

Yes, that's broadly correct, David. I might pass back to Andy to comment on the performance side.

Well, look, I think it's been steady, let's say, but slightly down. And I think that's a function of just the more -- perhaps a slowing in the U.S. market of consumer demand. But I mean, they've got a lot of things going on in the U.S. around immigration labor in meat plants. The shortage of beef is a problem for the industry. And so we've sort of got to go with the flow with those disruptions holding where we have been, it's been a pretty good performance from the team at Shelby, very good performance. So I just think we have got those macro -- those specific U.S.A. issues to deal with. I think it's -- they're not catastrophic or a massive problem. They're just working through slightly tighter beef supply, the labor issues and perhaps a softening of consumer demand. But we -- again, we don't see that as a long-term position.

Right. I understand. So in the pack when you talk to increases of petfood ingredients and sales volumes, that's collectively for the overall division. It's sort of flattish in Shelby and strong growth out of Melbourne and Holland. Is that the way to read it?

Yes, yes.

And there are no further questions at this time. I'll now hand it back over to Mr. Borland for closing remarks.

Yes. Thanks very much for participating on today's call. We look forward to providing you with further updates later in the year. I appreciate your support and interest. Thanks very much.

That does conclude our conference for today. Thank you for participating. You may now disconnect.

Good afternoon, everybody. If I just draw your attention, and thank you for coming out on what has been a chilly and brazing week of weather down here, but lovely to see you here joining us today.

Good afternoon. I'm Mike Petersen, the Chair of Scales Corporation, and it's my pleasure to welcome you all to this annual meeting. This is the 113th Annual Meeting of the company, the 11th since it became a listed company and my third as the Chair. Once again, we are holding a hybrid annual meeting and whether you are here in person or joining us online, I'd like to thank you and welcome you all.

As you may recall, shareholders, proxies and guests attending the meeting virtually will be able to hear and see a live webcast. In addition, shareholders and proxies have the ability to ask questions and vote on resolutions. I'll provide further detail on those matters shortly.

First of all, some housekeeping matters for those of you that have joined us in person. Firstly, I would like to remind you, as a matter of courtesy, to please turn your mobile phones to silent. Also, if there's an emergency and we need to leave, please do so through the marked exits. And staff will be available to help us.

I'm pleased to confirm we have a quorum, and therefore, declare the 2025 Annual Shareholders Meeting of Scales Corporation Limited open. The items of business for this meeting and the resolutions to be considered by shareholders are contained in the Notice of Meeting, which was sent to shareholders on the 6th of May.

Our order of proceedings is shown on the current slide, and I'll briefly comment on the highlights of the last 12 months, followed by a review by Andy Borland, Scales' Managing Director. We'll then attend to the resolutions, where we'll cover each resolution in turn and invite questions specific to those items. I'll explain the process for asking questions, and then I'll open the online voting and explain the voting process.

Once the meeting is complete, we hope that those of you present will join us for refreshments. I noticed there are also some of our prime apples out there. Thank you very much, Andrew. It will also be an opportunity to meet the directors and senior management of the group and raise any questions you may have on an informal basis.

I'd also like to note that we announced to the market this morning, an increase in our earnings guidance for full year '25, following a strong first half of the year for the group. This is very pleasing, and Andy will discuss this in more detail shortly.

I'll now summarize the process for asking questions, and please bear with me because this does have a little bit of detail to it. For those of you attending the meeting virtually, if you'd like to submit a question, the Q&A is always open. So please feel free to submit questions throughout the meeting. These will be addressed at the relevant time. [Operator Instructions] Should you require any assistance of any sort with the technology, you can type your query, and one of the Computershare team will assist using the chat function. Alternatively, you can call Computershare on 0800-650-034. Phone numbers these days are usually unusual.

Questions may be moderated, or if we receive multiple on one topic, we may amalgamate those together. [Operator Instructions] Any questions not answered in time will receive an e-mail response after the meeting. For those of you present, I will offer you an opportunity to ask questions on or speak to each resolution being put to shareholders at the appropriate time. As I mentioned earlier, there will be an opportunity to also ask questions of individual directors informally after the meeting.

With regard to online voting, if you're eligible to vote, you'll be able to cast your vote under the vote tab as shown on the screen. Once the voting is opened, the resolutions will allow votes to be submitted. To vote, simply select your voting direction from the options shown. You can vote for all resolutions at once or by each resolution separately. Your vote has been cast when the tick appears. To change your vote, simply select change your vote and you're able to change your vote up until the time I declare voting closed near the end of the meeting.

You may submit questions on each resolution being put to shareholders using the question process. For those of you who have joined us in person, those shareholders who are entitled to vote and proxies who have discretion as to how they vote, should have received a voting or a proxy form when they registered upon arrival at the meeting. If you completed a postal vote, you don't need to complete another voting or proxy form.

If you haven't received a voting or proxy form, at the time of voting, please go to the Computershare desk in the foyer, where their representatives will be able to assist you. After voting, please place your voting or proxy form in one of the ballot boxes, which will be passed around the room. I'll invite you to vote after all the resolutions have been introduced to the meeting.

I now have the clear voting open on all items of business. For those of you attending via the Computershare online meeting platform, the resolutions will now be opened in the vote tab. Please submit your votes at any time. I'll give you a reminder before I move to close voting.

Before I go any further, I'd like to introduce my fellow directors who are in attendance. First of all, we have Andy Borland, our Managing Director, sitting next to us here. We have Tony Batterton at the far end, Chair of the Scales' Nomination and Remuneration Committee, also Chair of Scales' Finance and Treasury Committee and an Independent Director; Miranda Burdon, sitting in the middle here, the rose between two thorns, Chair of the Health and Safety and Sustainability Committee and an Independent Director; Nick Harris, second from the right there, who's an Independent Director and a big contributor to our Board. Alan Isaac, second from the left, Chair of Scales' Audit and Risk Committee -- Audit and Risk Management Committee and an Independent Director; and Emma Wheeler, who's our future Director, who's joining us online today from Boston while she's working doing other things.

I'd also like to introduce and acknowledge Nadine Tunley, who resigned as a director in August last year to take up the role of Scales' Chief Risk Officer in Andy's senior management team. Nadine's sitting over in the far corner there. Nadine's contribution as a Director of Scales from 2019 to 2024 was significant, and we're delighted she's taken up this new role and continues to contribute to the group's success.

We have members of Scales' management and staff in attendance. So I won't ask them all to stand up, but you'll be able to ask them questions at a later date. We also have our auditors, Deloitte. We have [ Nicole and Hannah ], our auditors here, sitting up here in the back row. And Malcolm from Anthony Harper and the team also here. Where is Malcolm? There he is, right here and the team there from Anthony Harper as well. Delighted to welcome everyone to the meeting, and thank you for your attendance.

I'm delighted to say that Scales has generated an excellent group performance in 2024, producing record results while still delivering on our growth strategy. Our underlying net profit after tax attributable to shareholders of $34.3 million was up 81% on 2023 and was towards the top end of our 2024 guidance range. Our underlying EBITDA of $91.7 million and underlying NPAT of $53.6 million were both record results.

Global Proteins delivered a strong result, while Meateor Australia and Esro Petfood progressed steadily through their respective start-up phases. Horticulture returned to a more normal performance level, following the cyclone with improved apple volumes and prices. The Horticulture division also benefited from our increased ownership of Profruit, which produced an exceptional 2024 performance. Logistics also produced an excellent result, assisted by higher ocean and airfreight volumes. Dividends of $0.15 per share have been declared in respect of the 2024 financial year, and this represents 63% of 2024 underlying net profit after tax attributable to shareholders.

2024 was a busy year in respect of mergers and acquisitions and investments. And we're very pleased with each of the transactions we executed. We are continuing to seek acquisitions and organic growth opportunities to expand our business. And in that regard, you'll hopefully have seen our press release in April, announcing our increased investment in Shelby from 60% to 67.5% of this U.S.-domiciled business. Shelby's performance has been fundamental to Scales' success in recent years, with its earnings growth materially exceeding our expectations. We're excited by the expansion opportunities that exist within Shelby as a result of the various initiatives that have been put in place.

I would also like to make mention of China Resources who became a cornerstone shareholder in Scales Corporation in 2016 and who sold its shareholding in October 2024 due to a change in its strategic direction. China Resources were a very supportive shareholder and provided great insight into the China market for Mr Apple as well as providing a positive contribution to the Scales' Board. We'd like to thank them for their knowledge and expertise during their time as a shareholder of Scales Corporation during that time.

As ever, and I really want to reinforce this, our performance was the result of the hard work and effort of each and every one of our management team members and staff. And on behalf of the Board, I would like to say a big thank you to the mall for everything they do for Scales.

We pride ourselves on being more than just a place to go to work. And we continue to reinforce the importance of team culture and a sense of belonging that is the key foundation of our business and critical to our success.

One of the highlights of our year has been the establishment of an emerging leaders group during 2024 led by Geoff Smith. The group's purpose is to connect emerging leaders across Scales' divisions, allowing them to discuss challenges and opportunities. It also gives these emerging leaders more visibility to Scales' group strategy, access to directors and other industry leaders.

Mr Apple is our largest employer within the group with staff numbers increasing to over 2,000 people during peak season. With this being the case, we're pleased to report that we're on target with Mr Apple's 5-year people strategy, providing leadership courses and advancing our succession and leadership planning. We continue to support governance development. And again, during 2024, we hosted a future director as part of this work. Emma Wheeler, who's attending online, has filled this role for the past year, and we thank Emma for her contribution and participation during this time. We're in the final stages of making our next future director appointment for the coming year, and we'll announce that shortly.

We're also proud of our involvement in local communities and a few initiatives are listed on screen. Of particular note is the work undertaken by Mr Apple with the Fijian Government to employ 15 RSE workers from Kia Island. By recruiting these individuals, it helps them to rebuild their community after it was destroyed by category 5 cyclone a few years ago.

I'd now like to hand over to Andy, who will update you further on last year's results and activities, provide an update on the transactions that we undertook during the year and then also provide a brief outlook for the group.

Before Andy speaks, I'd just like to acknowledge the impressive efforts of the whole Scales leadership group, including our Board, the advisers that we have and the impressive senior management team superbly led by Andy. The world has been a challenging place to do business in the past few years with recessions, adverse weather events and geopolitical upheaval, coupled with global conflicts in many parts of the world. Our ability to successfully execute our growth strategy across all divisions in the context of these events has been very satisfying and it's a tribute to the performance of our team.

Following Andy's presentation, we'll move to the more formal business of the meeting. And as always, we welcome feedback on any of the matters raised during today's presentation or general matters in relation to the group.

So Andy, welcome, and thank you.

Thanks, Mike, and welcome all. One special guest we should note or acknowledge as Richard Swan. He is a banker from Westpac. If you heard the stories where you've had like 2 bankers a year or they turn over very regularly, well, Rich has been our banker for 25 years. So thanks, Richard.

Thanks, Mike, and afternoon, yes. I'll do a brief review of 2024. This slide highlights a few of our key numbers, some of which I'll touch on further later in the presentation. As Mike has mentioned, these numbers are a tribute to the skill and effort of our Scales' teams who have continued to deliver outstanding results in a period of change for the group. The graphs on this slide illustrate our earnings and revenue over the last 5 years. As Mike has also mentioned, the group achieved record underlying EBITDA in 2024, and underlying NPAT attributable to shareholders was towards the top end of our advised guidance range.

Moving on to some more detail in respect of the 2024 results. Reported NPAT attributable to shareholders of $30.7 million was up significantly on last year's profit of $5.2 million, and we produced record underlying NPAT, which was up 40% on 2023. Revenue was also up 3% on last year to almost $585 million.

You can see the trends in underlying EBITDA for each of the divisions on the current slide. Of particular note is the increase in Horticulture's earnings compared to 2022 and 2023, and also the record result produced by Logistics.

I'll now touch on each of the divisions in a bit more detail. Global Proteins produced a steady result compared to 2023, whilst it has set itself up for the next stage of its growth. Pleasingly, there were increases in both petfood ingredient volumes and edible proteins volumes of 11% and 28%, respectively.

Meateor Australia and Esro Petfood continued to progress through their respective start-up phases. There's strong volume growth in both businesses, with Meateor Australia operating profitably during 2024 and Esro expected to move into profitability by the end of this year. We also maintained revenue and margin per kilogram of volumes sold within the overall petfood ingredients business, notwithstanding the effects of Meateor Australia and Esro being in start-up mode.

Improved apple volumes, quality and prices helped Horticulture return to more normal performance levels. It's integrated business model and increased focus on premium varieties and overall variety mix also proved beneficial. Profruit delivered an exceptional performance assisted by a high level of process and exported volumes, and we're delighted that it's now a fully owned subsidiary of Scales Group.

There was an 11% increase in Mr Apple's own-grown export volumes compared to last year, which was aided by the team, undertaking numerous promotions and customer support in key markets. The proportion of premium apple volumes compared to traditional varieties also increased from 2023 from 64% to 72%, in line with our strategy. There was growth across all premium varieties, but pleasingly, there was significant growth in Dazzle, Posy and NZ Queen, which are our premium varieties.

This graph illustrates our actual and forecast export volumes. We estimate that premium varieties will account for around 80% of export volumes by 2027 due to the acquisition of the Bostock orchards as well as Mr Apple's ongoing orchard redevelopment program. As I'll touch on in the outlook section, the export volume in 2025 is likely to exceed the forecast shown by approximately 5% to 10% due to a better-than-expected gross pick and packout rate.

Onto Logistics and their record result. Both ocean freight and air freight volumes were up on last year at 16% and 71%, respectively. This generated a 61% increase in underlying EBITDA. The new Auckland warehouse and chiller facility also proved to be beneficial, processing a strong level of air freight volumes.

Our balance sheet continues to show a strong financial position. Net cash was in line with 2023 despite the cash outlay required for M&A transactions that were executed throughout the year. Other significant expenditure included dividend payments and CapEx. We're also pleased that Group ROCE, return on capital employed, of 14.5% exceeded our target of 12.5%.

The group continues to integrate sustainability and climate risk analysis into our wider business strategy in order to increase our resilience and deliver long-term stakeholder value. This means that we can identify how climate-related risks will impact our business over the short, medium and long term. Our appointment of Nadine Tunley as Chief Risk Officer is an important step in this area and significantly increases their capability.

We were pleased to publish our second climate-related disclosures in April. This report has been uploaded on the Scales' website, and I'd encourage you to access the report.

In terms of our people initiatives, we've developed -- we're focused on developing and retaining high-performing and high potential staff. This ensures we're actively working on our succession planning for critical roles. We've also rolled out the safety initiatives that were identified in our safety road map, including a rollout of a safety leadership program. We've substantially improved our market access and assurance processes and systems to comply with appropriate regulations, as equally as important, our ongoing customer requirements.

We also progressed a number of environmental programs throughout the year, a couple of which are noted on this slide, as an example of the wider benefits that can be achieved from environmental updates. Not only did the new wastewater plant at Amarillo in the U.S.A. improved environmental outcomes but also materially improved health and safety at the plant as staff members no longer have to remove waste solids manually each shift.

I'd now like to give an update on transactions that we carried out in 2024, each of which are contributing strategically to the overall group. I'm pleased to report that the Bostock transaction is contributing in line with our expectations, including a very strong performance from Profruit last year. In addition, Profruit shipping has now been transferred to Scales Logistics. The sale of orchards to Craigmore Sustainables has been positive with the capital that was released being used in other projects and transactions, allowing us to maximize our return on capital.

Within Global Proteins, Meateor Australia has performed strongly with increased production and sales volumes. Fayman has also had a strong year in part due to global beef shortages as a result of lower herd numbers in the United States. And Esro continues its start-up phase with the expectation that it will be profitable by the end of this year. Aligned to our strategy, we expect to increase our shareholdings in our Global Proteins businesses over time.

In respect of the current year, as released to the market earlier today, I am pleased to note that the directors have updated the guidance range of underlying net profit after tax attributable to shareholders to between $40 million and $45 million. This is an increase from the previous range of $37 million to $42 million. The group has seen a strong first half of the year, particularly in the Horticulture division. Global Proteins has had a positive start to the year, particularly in Australia and New Zealand. The new processing facilities in the United States and Europe have been successfully commissioned and both are now in commercial production. However, some uncertainty does remain in the global marketplace in respect of the impact of tariffs.

Within Horticulture, the harvest is complete with a total pick of around 4.6 million TCEs or cartons, above our initial forecast. Export volumes are tracking ahead of expectations with packout rates similar to last year. Pricing is as anticipated. Logistics is currently trading ahead of budget due in part to the apple season starting earlier than normal. Lastly, I can advise that Mr Apple's Whakatu Coolstore has been sold and leased back. The sale for $24 million will settle in August this year.

That concludes my presentation. We'll answer questions following the resolutions. But in the meantime, I'll pass back to Mike to cover the formal part of today's meeting.

Thanks, Andy. That was a pretty quick race through. So I'm sure there will be questions at the end of the meeting on some of the details on those slides. And I think you'll agree that the slide certainly indicate it's been a very successful year for Scales, and so we're very delighted to be able to report that to you today. Thanks, Andy.

We'll now move to the business of the meeting. All items of business are ordinary resolutions and are required to be passed by a simple majority of votes. Current best practice for shareholder voting is by way of poll. And accordingly, a poll will be held for each of the resolutions. I and my fellow directors hold the following undirected proxies.

With respect to resolution 1, authorization for the directors to fix the auditor's’ remuneration for the coming year, 131,381 shares. With respect to resolution 2, reelection of Andrew Borland as Executive Director, 97,383 shares. With respect to resolution 3, election of Alan Isaac as nonexecutive independent director, 102,383 shares. And with respect to resolution 4, authorization that the maximum total pool of directors' remuneration payable by Scales to directors be revised, 117,386 shares. Your Board supports these resolutions, and we intend to vote all of these shares in favor other than resolution 4 in respect to which voting restrictions apply. That's the resolution relating to directors' fees.

I'll now move onto each of the resolutions, and resolution 1 relates to the remuneration of auditors. This proposed ordinary resolution is to authorize the directors to fix the auditor's remuneration for the coming year. In accordance with the Companies Act, Deloitte has automatically been reappointed as Scales' auditor. As is usual with audit fees, due to the complexity and changing nature of the company's affairs, it is not possible to fix the remuneration at the beginning of the year.

I'll now move as an ordinary resolution that the Board is authorized to fix the auditor's remuneration for the coming year. Are there any questions on this resolution?

[indiscernible]

I'm going to look to Steve now to...

[indiscernible]

And I think maybe Nicole might be looking them up as we speak. No? Yes. That says -- good. Never ask a question if you don't know the answer to it. Well done.

Thank you. We'll now move to the next resolution, if there are no further questions. Resolutions 2 and 3 relate to the reelection of a director. The NZX Listing Rules state that directors must not hold office without reelection past the third annual meeting following the director's appointment, or 3 years, whichever is longer. Accordingly, Andrew Borland and Alan Isaac are required to retire at this meeting. Resolution 2 relates to the reelection of Andrew, as we know him better, Andy Borland. Andy became Managing Director and was first appointed to the Board in 2011. A brief biography for him was included in the Notice of Meeting. Andy, being eligible, offers himself for reelection, and the Board unanimously supports his reelection and recommends that shareholders vote in favor of resolution 2.

I'd now like to invite Andy to briefly address the meeting on his proposed reelection. Over to you, Andy.

Thank you, Mike. It's easy if I do it up here. Well, first of all, shareholders that are here sort of get a double return because, when I started as a director, apples were in lieu of dividends. And when we stop them and started paying cash, we got a hell of a tune-up from the shareholders because they really enjoyed those apples. But obviously, it's been a great privilege to be a Director of Scales over these past 15-odd years. I am available and continue to respectfully ask that you give me your vote to continue to do so.

I think the major task at Scales, being a diversified company, I have always sort of looked at it as being -- a key part of it is leading and growing the teams. So leading and growing the teams has been a key role for me. I have enjoyed immensely working with the senior people and the younger people coming through, and what we're building up is very good talents within the industries that we operate in. And we encourage the younger people to keep learning and improving so they can take over in the future. So I think that the thing that sets apart Scales from our competitors and many of the industry we're in is the passion and hard work, the skills that they've got, the training they've had to do the job right. And we want to be at least first or second, preferably first in terms of performance and abilities in the industries we work in. So I think if you do vote for me, I'll continue to try to keep doing that and continue to grow and expand the teams, and I look forward to being here next year, if you vote for me.

Thanks, Andy. I now move as an ordinary resolution that Andy Borland, be reappointed -- sorry, reelected as an Executive Director. Are there any questions on this resolution? Yes, sir?

[indiscernible] How do you view your performance?

I don't vote on that one.

And review your performance?

Yes. No, a fair question. And look, our governance is a key part of what we're talking about here. Obviously, I have had a long history in governance, did the IOD course way back in the day, did a frontier governance development program in the day, got -- which was a great experience. They invested and other farmers looking to get into directorships and that course was a very intense and valuable one. And then when Direct Capital come into Scales, they wanted to -- they promoted me or invited me to become a director of the company.

And I obviously think about 2 things about governance. From my point of view, the most important thing, as you say, is to get the CEO right. That's probably the one of the most important jobs. But I think then on the governance side, we're a comp -- is a bit complex, but it's a diverse agribusiness company, and we have to be careful that we treat governance very seriously in all of the subsidiaries we've got. So generally, the Scales Board looks over the top, looks at strategy, looks at the performance of me and the senior team and really focus us on the task of managing the various entities appropriately. So I feel like I'm reasonably well qualified to be a director of Scales.

Thanks, Andy. And it's a fair question because you don't often see Managing Director roles these days but it's one that's been in Scales, and it has served us well. But just to be clear, we had a Board meeting today, and so Andy was very much the Chief Executive's role there in the board meeting today. But we have our Nominations and Rem Committee that Tony Batterton and I sit on Andy's performance, and his objectives and the review of all of those are done very rigorously between us as directors on that subcommittee, it's reported through to the Board. And so all of those things are covered off very professionally where we make sure that we do not sort of blur the lines between the Chief Executive role or being a director role. I can assure you he does not get an easy ride because he is a director as well as the Chief Executive. And so we hold him to account just that we would any chief executive. So thank you, it's a good question.

[indiscernible]

So did everyone hear that question? Having developed a great team, Andy, when do you envisage passing that baton? Shall I bring the walking stick for you to stand up, Andy, to the chair?

Yes. Look, obviously, I think I was appointed by the company for another 5 years, 2 years ago, was it? Last year, okay. So theoretically, that's 4 to go. I'd be 65 then. So that doesn't mean to say you got to stop then, does it? But yes, look, no current plans. Obviously, I'm enjoying what I'm doing, working with very good people. I probably did forget to say that I was Chairman of Rabobank in New Zealand for 3 years, run a fish company out here at Akaroa Salmon, which are not easy things to govern because you never know how the performance of the fish are going as you can see with King Salmon. But I think I've had a widespread experience as a director. And yes, to the other question, keen to stay working with a great bunch of people.

Thanks, Andy. We look forward to your contribution for a little while yet. So thank you. So I'll move on to the next resolution unless there are any other questions. Steve, nothing else online?

No.

No. Okay. Thank you. Resolution 3 relates to the reelection of Alan Isaac. Alan was first appointed to the Board in 2014, and a brief biography form was included in the Notice of Meeting. Alan, being eligible, offers himself for reelection, and the Board unanimously supports his reelection and recommends that shareholders vote in favor of Resolution 3. Alan has indicated that if reelected, he intends to retire from the Board prior to the next annual meeting at which he would be required to stand for reelection. Following Alan's confirmation of his retirement, the Board will look to appoint an additional director in accordance with the Board's succession plan.

I'd now like to invite Alan to briefly address the meeting on his proposed reelection. Thanks, Alan.

Thanks, Mike. I welcome the opportunity to speak to you today briefly, whether you're in the room or somewhere online. By profession, I'm a chartered accountant, but I have had significant commercial experience with a number of leadership roles, both in New Zealand and overseas. Following a career with KPMG, when I retired in 2006, I've got involved in governance. I currently have roles on Skellerup and Oceania Healthcare. In those companies, I chair the Audit and Risk Committee, as I do at Scales. It's been a real privilege being involved with this Board, with this company and Andy and his leadership team since 2014 when the company listed. But as Mike's indicated, and Andy's made reference to age, a little bit older than that, 65 that you referred to. So it's appropriate that I step down sometime in the future, in the near future, perhaps. But in the meantime, I look forward to your support to continue to contribute to the governance of Scales. Thank you.

Thanks, Alan. And look, Alan's one of the most recognized and probably celebrated directors in New Zealand, particularly around audit and risk matters, and so his contribution to the company and on our Board has been immeasurable.

Look, I now move as an ordinary resolution that Alan Isaac be reelected as a non-executive independent director. Are there any questions on this resolution? No, nothing online, Steve?

None.

Thank you. I'll move to Resolution 4 then. And Resolution 4 relates to a proposal to revise the maximum pool -- total pool of directors' remuneration available to your Board of Directors from a total fee pool of $650,000 per annum to $625,000 per annum, payable for the 2025 year effective from the close of this annual meeting. Shareholder approval is required on the NZX Listing Rule 2.11.1. An appropriate fee structure is important to ensure that Scales can continue to attract and retain the right directorial skills and experience to govern your business and that those directors are being fairly remunerated for the work they do. I recognize that this is a bit unusual in that the director fee pool is actually being reduced.

The proposed change in the directors' fee pool reflects a revision in the total pool due to the resignation of Nadine Tunley and also [ Shin ] from China Resources, while also taking into account a small increase in individual fees following benchmarking from a group of agribusiness peers to ensure remuneration is fair and reasonable for the size and performance of Scales. This provides the Board with a remuneration fee pool considered appropriate to remunerate a Board of 5 nonexecutive directors, including for associated committee work.

I now move as an ordinary resolution that the maximum total pool of directors' remuneration payable by Scales to directors in their capacity as directors be revised some $650,000 per annum to $625,000 per annum. In accordance with NZX Listing Rules, the directors and their associated persons are restricted from voting on this resolution. Are there any questions on this resolution? Yes, sir.

[indiscernible]

That's exactly right. And look, I'll ask Tony Batterton to talk about the process that we went through. But just to be clear, we have a policy where we only review fees every 3 years. And so the fees have not moved for 3 years. So unlike some companies, they don't move annually at all.

But Tony, do you just want to comment on the process by which we reviewed fees and looked at our peers? Maybe use the microphone, Tony, sorry.

Yes, you're right. So as part of the changes that directors fees we have conducted the 3-year review. We look across -- there's 8 or 9 other listed agribusinesses in New Zealand or generally either exporters or a number of them like us have substantial operations around the world. So we think we have the closest comparator set. So we start by doing a review of the rates that are applied in those 9 companies. We also do a secondary review, which is looking at what has happened to directors' fees across the board, across the whole of the NZX market. And there's a couple of independent bodies that do that review. The Institute of Directors do one review, another group called [ SmartPay ] do another review. So we also take account of the information available in those reviews.

We also did a secondary check around how the proposed adjustment compare to the inflation rate, which is applied over that period. We wanted to make sure that the adjustment was well below the inflation rate. I think it works out to be about half of what the CPI would have been over those 3 years. So that's the work that we do to make the assessment of what is appropriate in the circumstances, and we're careful in the notice really to set out that the fee pool has been reduced because the number of directors it's applying to has reduced. At the same time, the amount per director has gone up, we hope, is a very appropriate amount.

Yes, sir?

[indiscernible]

No, he's on a separate package. Yes. He gets paid as a chief executive when he sits here in the Managing Director's role. Yes?

[indiscernible]

Yes, there is. We have a set program and timetable throughout the year. I can't remember the exact hours it is, but we are talking about somewhere between 5 and 10 Board meetings a year. Some of them will be 1 day, some of them will be 2 days, depending on where we are. There will also be Board meetings in between the physical meetings. There may be -- for example, we had a Board call last night to discuss the revising the market guidance to the market this morning. There are other duties that people are doing as directors on subcommittees Miranda on the health and safety subcommittee, for example, when I visited Profruit, our plant and Hastings when we were there in the afternoon after our Board meeting that day. So there are a lot of duties that directors are doing as well as site visits in between Board meetings as well.

So look, I couldn't tell you what the exact hours are, but we're certainly working on Scales every week for sure.

[indiscernible]

We're doing probably about 1/4 of our meetings online. But -- and the rest of them are at sites. What we do is we try to rotate them around the places where we have our businesses. So we'll meet in Hawkes Bay, where Mr Apple is in Profruit, and we'll take the opportunity to meet with the teams while we're there. Very important for us in our business, we think. Developing the culture means that the directors talking and meeting with the staff on the ground is a critical part of actually having a company like ours that has a positive culture. We don't see ourselves as being on a pedestal any different from anyone working in the business. And so for us, just to be talking to orchard managers or into the Profruit team or meeting with people in Mr Apple or in logistics up in Auckland or down here in Christchurch like we've been today, meeting with the team in the head office and corporate office here today. So it's -- we do probably, I'd say, about 1/4 of it online and about 3/4 probably in person.

Thanks. Any other questions on the remuneration? Okay. Those are the 4 resolutions.

Ladies and gentlemen, that concludes our discussion on the items of business. So I'll close the voting online very shortly. And if you haven't already done so, please cast your votes now. A reminder of how to vote online is shown on screen. And Computershare will now come around and collect the voting papers from shareholders in the room. Once all of the votes have been cast, they will be counted by the company's share registrar Computershare and scrutinized by the company's auditor. The results of today's meeting will be released to the NZX on the completion of verification of voting. And so we'll now move to finalize voting and answer general questions. So I'll just give wee pause for you to put your -- those present to put your voting papers in the boxes that are coming around. Voting won't be closing yet, so we can carry on. You can continue to ponder if you need to.

[Voting]

Great. We'll move on to the questions. If there are any questions on the reminder results -- sorry, on the financial results, the business update or any other matters you'd like to raise. For those online, please do so through the Computershare online meeting platform. A reminder of the process is shown on the screen. And just click on the Q&A tab. For those of you present, I'll now open the floor to any questions. And just a reminder that if we run out of time to respond all questions now, we'll respond to any additional questions in writing following the meeting. So we have got plenty of time, so we're more than happy to answer questions if you have any. Any questions from people in attendance for a start before we move to online? Yes, Frank. We've got a roving mic here. Here we go.

Yes. My name is Frank Stewart. I represent the Shareholders' Association. We hold about just over 2 million proxies to vote. And we are voting all the resolutions in favor. 2 questions, one is a question I normally ask is, there's about 70 in this room, how many are online?

Here we go. Steve Kennelly?

Had a couple of updates and the latest number was 51 online.

And the second question relates to the Craigmore sale. They're a competitor of yours. And I just wonder what was in it for -- I want more details of it. What was in it for them and what was in it for you? Yes.

A competitor, yes, sort of industry player, I would more say maybe. But look, for us, we've done business with Craigmore before. We had a leased property in [ Parkaway ] that the tenant was going broke and how long ago, 10 years ago, Andrew? 10 or 12 years ago, we sold -- well, we got hemmed by the property and then we carried on leasing it. We were short of capital at the time. We weren't wanting to put more capital in. So we did that deal with Craigmore. We've been a tenant of Craigmore for 12 years, and they've been very good to deal with. And obviously, they've continued to raise money mainly from offshore. And they need to get approval from the overseas investment office to invest and buy more farmland.

So they were looking for land that needed to be developed. So they -- and we were -- so the Bostock transaction, we bought, developed land with Dazzle and other good premium varieties already planted -- and -- but we're able to sell 2 of our undeveloped orchards to Craigmore, and they needed to do the development to get the overseas investment approval. So that was a good fit for all parties. But I think more importantly, for us, it was probably just more of an allocation of capital. We didn't necessarily want to put more capital into horticulture. So we were just allocating it to higher returning orchards out of -- and Craigmore has got, I say, more patient money coming out of Europe that isn't necessarily looking for the sort of returns that a listed company here in New Zealand needs to make.

So I think it was a good fit. And they continue to -- those apples are not lost to us completely. They -- we pack them, we will export them. We're collaborating with Craigmore in the breeding now because they've invested into Fruitcraft, and they're a good partner in there as well. So we sort of see them as complementary business partners, I say, rather than competitors.

So I think certainly, from our perspective, we have some post-harvest expertise that's complementary to Craigmore's desire to actually own land assets. So -- and they are picking particularly assets so they can improve and be very high-class land-owning fruit-producing assets.

Yes, across all of the farming practices, dairy, forestry and horticulture, or those 3 anyway, that I know they're involved in -- their fund has got more than NZD 1 billion in it now. So it's a big player.

The $4.3 million, is it Kiwi or...?

No, no. He lives in New York half of the Year and Florida the other half, dodging tax -- minimizing tax, my audit risk man tells me. Yes. I'd say, look, Brett's a great operator. And those sort of remuneration packages are not necessarily very common here, but they are in that market.

Yes, sir?

The Chinese were the cornerstone shareholders. They took over Ellen Hubbard's interest. Is that correct?

No, direct capitals, last shareholding, yes.

Okay. might be a silly question, but where did that shareholder end up? Is it dispersed through the market or...

Yes, very much so. Went to a number of institutions increased or come in new, a couple of new Australian ones came in, and then a lot went out to the retail through their brokers. So it was very good for us. It gave us more shareholders. And I guess, a greater spread. Actually, from an NZX point of view, that improved our liquidity profile by having -- not having those shares tied up in 1 owner. And with ACC Harbor, a number of those big investment institutions either came in new or increased.

They're a good shareholder to have. They changed their investment strategy, and we had other things to do with the money. We had a very good, amicable relationship with them right through and enjoyed them being a shareholder, but for their good reasons they left and they had a very successful return out of Scales over the 8 years they were shareholders.

The point about that, too, they were a form of access to the Chinese market, weren't they? Did they access...

Look, early on, they did, but their philosophy changed a little bit. So really, there was -- their benefit to us was they were one of China's iconic companies, state-owned enterprise, employed 500,000 staff. They built the Wuhan Hospital in COVID. So they're builders, they're farmers, they're right across their conglomerate. And it was very positive for us at Scales to have them as a shareholder in the Chinese market because you said China Resources are a shareholder, and that was plus. And people still remember it, but there was no problem with them, not necessarily. There's no -- we still have very good access into China through the free trade agreement absolutely.

I think one of the things that has been interesting in the last few years is we've really taken more of a marketing and direct control of our sale of apples into China, for example, has been just how successful that's been. You'll see Dazzle by Mr Apple. Apple varieties now by Mr Apple, and it's become very well known in the market, that Mr Apple was as a quality brand of apple and produce up in China. So actually, the efforts of our marketing teams probably been better than necessarily having a Chinese shareholder that was a cornerstone, and we're pretty excited about how that's tracking.

Other questions in the room? Yes, sir, at the front here.

[indiscernible] a shareholder. There's a lot of damage done to the orchard in Hawkes Bay by the rainstorms a few years ago. What I'd be interested to know is has it been possible for the company or the regional authorities to provide better protection to the orchards by way of perhaps increasing the height of stopbanks or whatever?

I'm happy to answer the stopbank question because I'm a bit on top of that. There is a plan to lift the stopbanks, but that has not happened yet. So there's a lot of remedial work that needs to happen. I live in Hawkes Bay. So that needs to happen to those stopbanks. There's been a lot of buildup in the river course itself, which appears to have lifted the height of the river as well. So there's actually quite a bit of concern still about where that is at in Hawkes Bay, but that plan is now getting actioned. And so we're pretty confident that, that will bring back a bit more resilience to the orchards.

Andrew, did you have any comments on that or Andrew van Workum working from Mr Apple. Yes.

[indiscernible].

Councils haven't got a lot of money in Hawkes Bay at the moment after dealing with the cyclone, but they're getting on with it. The government has provided some quite a lot of support.

Okay. But at the moment, it's still at risk.

Well, it is at risk, but I guess there are some orchards that are more susceptible, Andrew, that we haven't continued farming, have we? There were some of those lease blocks that we no longer farm?

[indiscernible]

Yes. So there's definitely -- the remediation has been very successful. And so we're -- look, we can never be too sure because rainfall events seem to be getting more intense. But it's one thing we're very much -- we're very aware of. Any other questions from in the room? Yes, sir, on the corner there. Yes.

You've updated your profit. What about dividend?

You've got to take a lot of apples with you, Paul. No, but honestly, as the profit does grow, we'll obviously just hold within our range. And if we can lift the quantum then and hold the range that should increase over time. So I think we've committed to 50% to 75% of NPAT attributable, Steve?

That's right.

And paid 62%.

62.5%.

I'm a shareholder, too. I would like to see it growing as well.

Excellent. Any questions online, Steve?

We have a number actually. So the first one is, will Scales hold more AGMs in the North Island?

Well, if I did a poll in the room here, I think they'd say no. But it's quite warm up there today. It's a very good point.

We have had one before, haven't we, in my time?

We've had one, pre-COVID.

Yes. So no, we definitely consider it. Sorry.

Next question is what new tariffs does Scales face? And supplementary question, are you taking proactive steps to mitigate these tariffs?

Yes. Yes, we are. Andy?

Yes. Look, in most cases, but appropriate for a start, the 2 customers that we have, our longer-standing customers, both e-mailed us almost the day that they announced, said that they would pay the tariffs, told us that there's something to be added to the bottom of our invoice basically. And then across most of our pet food customers in Europe into the U.S. have also agreed to pay. So it's -- it's largely being mitigated by the entities we deal with because we are sending them in many respects, stuff they can't necessarily get from their local market. I mean there's a lot of juice in the world, but there's no juice like our juice. But I think the -- that was the question, wasn't it?

It was.

But I think this has been a very active question. The tariffs that have been imposed, particularly into the U.S., something that we're all asking is exporters. And so I know that companies I'm involved with, we're all insisting that the importer pays the tariff. Though some of those discussions are still alive and ongoing because some of the product hasn't yet hit the market. That's subject to those tariffs. But at this stage, we're seeing pretty good acceptance and uptake of the fact that the tariffs were born in the U.S. and they should stay in the U.S. But not saying that it's going to stay like that forever, but we're tracking well pretty well so far.

As we said in our document here, the greater concern is where does it all end up in terms of global economics. So we've put that out there that it's an ongoing risk if China and America can't sort of get to agree reasonable terms, the economies might not go so well.

Yes. Steve?

And the last question, with the withdrawal of the China Resources cornerstone shareholder, isn't Scales vulnerable to take over activity?

Well, our shareholder base is now spread a bit wider. So I'll defer to the experts here like Tony Batterton, maybe, but as we said earlier, we feel it's been a net positive in terms of having a broader set of shareholders. And I think it was also known for some time that China Resources change of strategy meant a desire to realize or sell out of their New Zealand interest. And that sort of created a little bit of an overhang in the market for a period while that knowledge was there, but they hadn't been able to realize their stakes. So I think from a Board point of view, we ultimately -- I mean it was China Resources decision. But from our point of view, ultimately, it has been significantly positive to our register going forward in terms of the makeup of it.

I guess you can make the same comment about any listed company really that has a wide range of shareholders. So we're no different in that sense to anyone else who is a listed company with a wide range of shareholders. That's an element of life, I guess, for any listed company for which we're no different. It's not something we're sensitive to, we're overly concerned about. We're focused on maximizing the value of the company on a daily basis. And the first thing to do is to perform in terms of our trading. That's a key thing. And then the decision will be in your hands to shareholders. Steve, anything else?

No further questions online.

Okay. Any further questions in the room? Okay. Ladies and gentlemen, that concludes our discussion on the items of business. Shortly, I'll close the voting system online, please ensure that you've cast your vote on all resolutions. I'll now pause to allow you time to finalize those votes.

[Voting]

I think everyone's vote has been picked up from -- in the room. Okay. Voting is now closed. The results of all votes will be released to the NZX later today.

Ladies and gentlemen, there doesn't appear to be any further business for discussion. So that brings us to the end of formal business for Scales Corporation 2025 Annual Shareholders' Meeting. I'd like to thank you all for attending today and taking the time to come along and hear our results for the past year, whether it's online or in person, and wish you all the very best for the week and the year ahead. Thank you very much.

I now declare the meeting closed and invite those in attendance to stay on for light refreshments and the opportunity to have informal discussion with directors and any of the staff and management team around involved. So thank you very much.