Thank you for standing by, welcome to Baby Bunting's FY 2023 results call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press Star followed by the number one on your telephone keypad. If you would like to withdraw your question, press the Star one again. For operator assistance throughout the call, please press Star zero, finally, I would like to advise all participants that this call is being recorded. Thank you. I'd now like to welcome Darin Hoekman, CFO, and acting CEO, to begin the conference. Darin, over to you. Morning, everyone. Thank you for joining us, and welcome to our investor presentation and review of the FY 2023 financial year. My name is Darin Hoekman, Acting Chief Executive Officer of Baby Bunting. This year has had some particularly challenging elements to it. We've seen cost of doing business pressures on the rise, consumer behavior normalizing to pre-COVID patterns, and we have seen consumers increasingly impacted by the rising inflation and increases in mortgage rates. We have responded to these challenges through the year, making adjustments in the face of some gross margin challenges in the first half, and then sales volatility in the second. Looking forward, our mindset now is to continue to identify opportunities to help lower the cost of parenting for our customers and at the same time managing our costs down to build profitability in the business. Through all this, we've also continued to invest in growth. There are encouraging signs in our New Zealand business. We've recently launched our very own baby and kids Marketplace, available at babybunting.com.au. Before we speak about those elements further, I'll discuss our FY 2023 pro forma financial results. Turning to slide four. First a point to note is that as Baby Bunting operates a retail financial calendar, FY 2023 was a 53-week financial year. The numbers presented here are pro forma and exclude sales and expenses from week 53 to enable comparisons with prior 52-week periods. Disappointingly, our FY 2023 earnings results have fallen well short of the growth numbers we have been delivering year in, year out since IPO in 2016. However, the business continues to be in a sound, competitive, and financial position with a market-leading store network and first-to-mind brand awareness far above anyone else in our industry. To summarize our financial results, well, expected sales growth, coupled with margin compression, labor cost inflation, and cost investment for future growth, has seen a significant contraction in year-on-year profitability. EBITDA margin under the old measure has now dropped back to 6% of sales, a decline of 4% from the 10% achieved in the prior year. Our pro forma NPAT is down by 51%. In light of this, and as the consumer outlook continues to appear challenging in the near term, management has activated a number of initiatives across the business aimed at offsetting the impacts of inflation, improving operating cash flow, and delivering more efficient operations in FY 2024. The balance sheet is in a healthy position with low net debt and plenty of clearance in our banking covenants. There'll be a final dividend of AUD 0.048 per share, in line with the board's policy of paying out around 70% of pro forma NPAT. Turning to slide five, operating summary. We opened seven new stores during the year, including our first store in New Zealand. It has seen strong improvement through the year as we establish our brand in that market. A store in Christchurch was scheduled to open in FY 2023; however, we now expect this store to open around Christmas time. In June, we launched the Baby Bunting Marketplace. We now have an additional 5,000 SKUs available for sale on our website, with a plan to build this out to over 20,000 SKUs by the end of the year. 2023 was the first full year of our new loyalty program being available across all channels. The take-up and usage of this program was well above expectations. It's providing valuable insights and will help to evolve our offer with our loyal customers. During the year, we made some changes to the program that significantly improved the margin on our redemption transactions, as well as the financial performance of the program overall. Slide six. While 2023 has been a tough year financially for the business, we continue to be confident in the strategy overall, our defensibility within the category, and the future earnings growth potential of the business. Our confidence is based on a few factors. There are around 300,000 births a year in Australia. There are no specialty retail competitors with a national presence. We have 45% product exclusivity. With 50% of sales revenue coming from 10% of our customers, we have the potential to grow wallet share in a large proportion of our customer base, loyalty, and further personalization of offers. We are committed to our core purpose. We're focused on delivering value every day. Additionally, Marketplace provides us an opportunity to expand our offer and grow lifetime spend with new product lines. We're only starting with our journey into New Zealand. Slide seven. Slide seven shows that we're the only national specialty baby retailer with a clear omni-channel advantage over our competitors. Slide nine. Looking now at sales in further detail on slide nine. At AUD 515.8 million of sales for the year, we have delivered a total sales growth of 1.7%, with comparable store sales down 3.6% for the year. Unpacking that a little further, in terms of channel performance, our stores grew sales by 4.6% year-on-year, or measured on a comparable basis, a - 0.8%. Online delivery sales grew 5.5% and 6.6% in the second half as we focus on evolving the functionality of the site through the year, with improving search and content to better engage our customers. The largest impact in terms of sales fallout occurred through click and collect, which previously more than doubled through COVID. In the year, this channel contracted by 24.5%, reducing from 10.4% of sales back to 7.7% of sales. Specifically, the fallout was in the consumer staple categories that were more broadly available across the retail market. As customer channel behavior reverted to pre-COVID patterns, these sales dispersed back into general retail, including shopping centers. Slide 10, gross margin. After facing into some significant cost of sales pressures in the first half, gross margin did improve through the year as management responded. Our second half margin is usually lower than the first half, as we have a higher indexation of promotional sales in the second half of each year. Therefore, a 50 basis point improvement half-on-half good outcome. Cost increases experienced during the year included international container shipping rates, which peaked through calendar 2022 and have now moderated back to pre-COVID levels, diesel fuel levy increases, and higher than anticipated reward redemptions within our loyalty program. Another area of challenge was in the play gear category, a high-margin category which doubled in size through COVID and which has now all but normalized back to pre-COVID levels. Key changes made included adding a minimum spend on loyalty redemptions, which improved the margin achieved on these sales by 7% from December 2022 onwards. Looking to FY 2024, we will continue to cycle down from higher shipping costs and cycle the benefits of the changes made to the loyalty program made late in the first half last year. I want to emphasize that our focus will be on maximizing market share and keeping prices low to help our customers lower the cost of parenting. Slide 11, cost of doing business. We continue to invest in the business as we progress our store rollout and drive market share growth. We are at around 60% of our store rollout, and investment is critical to supporting our growth. The increase in store costs has been driven by the new store rollout, with seven new stores opened this year and four stores opened in the prior year, annualizing their first full year of trade in FY 2023. On a store-by-store basis, average store running costs were maintained at around AUD 1.5 million year-on-year, despite the inflationary environment, in particular, around wages. The area of overheads, we managed warehousing variable costs in line with lower transactional volumes, our marketing cost line saw the benefit of further progression in the reduction of printed paper catalogs. To achieve further productivity and overall efficiency in the business, we have activated a number of cost-out initiatives that will deliver between AUD 6 million-AUD 8 million in reductions through FY 2024. Specifically, these are in the areas of administrative overhead and, to a lesser extent, in warehousing and marketing. Slide 12, store economics. Our stores continue to deliver strong financial results, with many of the gains made through COVID still present today. Our stores, on average, take +4 years to mature, although this occurs more quickly in some markets, in particular, those located regionally. Currently, still a third of our store fleet is less than five years old and still in their growth phase. 47 of our 64 stores that have traded a full year are mature. On average, our mature stores deliver +100% returns on invested capital, with only three of the 47 mature stores doing less than 50%. Slide 13. We opened our first store in New Zealand one year ago today. We've made some terrific progress in this catchment, which is informing our approach to the New Zealand market. Our strategy is broadly consistent with Australia, in that we aim to sell the widest range of products, backed by great service at low prices every day. In the second half, we ramped up our promotions to help drive brand awareness and foot traffic, which has seen a marked improvement in our sales performance in the second half. This year, we are well progressed towards opening a further three stores in New Zealand. We have one further lease secured for our fifth New Zealand store that will open in Auckland earlier in FY 2025. Slide 14 shows the relative spend of the 750,000 customers that shopped with Baby Bunting in FY 2023. A considerable proportion of our revenue, around 50%, comes from 10% of our customers who love to shop our brand. This demonstrates the significant opportunity for market share growth in subsequent deciles. The focus will be around offer, including broadening our online offer through Marketplace, reducing lead times for online delivery around the country, and the continued expansion of the store network to ensure better proximity to the customer. Slide 15, which provides an overview of our transformation program. With the majority of this program complete, the intention was to complete the integration of the UKG time and attendance system in FY 2023, which has been done, and to complete the implementation of a new ERP and point-of-sale systems in FY 2024. We have now elected to progress these significant programs of work, being the ERP and point-of-sale systems implementations, a slower pace through the initial phases of these projects. We will complete the RFP by the end of Q1 this year, and at this stage, envisage progression toward product build and integration to take place later this financial year or potentially in FY 2025. The decision to change the timing of these very large projects will change the phasing of spend we had previously communicated, but not the expected value. Slide 16. Presented here is the 52-week pro forma P&L. There is a reconciliation explaining the differences between the pro forma profit and the statutory profit in the appendix and also in the full year accounts. In summary, the current prior year differences relate to the exclusion of employee equity expenses and significant business transformation program costs. In terms of the impact to net profit, the key drivers of the decline have been gross margin, which impacted NPAT by AUD 4 million year-on-year. Comparable store sales decline, impact of around AUD 4 million year-on-year. The inflationary cost affects AUD 4 million. The New Zealand launch was around a AUD 2 million impact year-on-year, and then the investment in Marketplace around AUD 1 million. As a reminder, of the AUD 16.5 million increase in cost of doing business, over AUD 10 million of this was growth from investment for new stores, New Zealand and Marketplace. Looking to the balance sheet on slide 17. We continue to run our balance sheet with plenty of headroom in our debt facility in good clearance with regard to banking covenants. In relation to inventory, during COVID, we invested in an additional two weeks of safety stock to mitigate timing risk around international shipments. We have now unwound this investment in Q4. As a result, year-on-year inventory was only AUD 1.3 million higher, despite seven new stores plus the New Zealand DC stock build. Regarding leases, the change balances primarily relate to the new store leases in Australia and the lease renewals that were made during the year. Moving to the cash flow statement on slide 18. Management of working capital through the second half has seen our operating cash conversion ratio improve from 71% in the prior year to around 82% in the current year. Our capital investment program was lower year-on-year, noting around AUD 1.5 million of CapEx incurred in FY 2022 related to stores opened early in FY 2023. Sustenance CapEx of AUD 5 million was consistent year-on-year, we saw lower CapEx from transformational projects in FY 2023. Next year's capital investments will moderate further again as system transformation slows and we reduce our new store openings from seven down to five. I will now discuss one of our growth investments from FY 2023 in more detail. Slide 20, Baby Bunting Marketplace. As the number one specialty baby retailer in Australia, we have built significant brand awareness and trust with 750,000 active loyalty customers and 30 million website visitations per annum. However, in context of raising a child, we are still only servicing a fraction of the needs of parents, that is, and believe there is a significant headroom to grow customer lifetime value and retention through range extension. Our customers have a relatively linear journey, unlike other categories, and most customers experience similar needs at similar times, which make it easy to inform our range strategy to meet these additional needs. Marketplace presents as the most capital-efficient and agile response to this opportunity via a seamless integration of third-party products and sellers into our existing online experience. It doesn't disrupt existing supply chains or add inventory risk, allows us to curate the range without cannibalizing existing range. In effect, Marketplace will work hand in hand with our 1P range strategy, where we do see great results. Where we do see great results in 3P products, it will help shape our future in-store range and offer. By offering more brands, more products, and more choice to our customers, and meeting more moments of need every day for their growing families, it will further cement our market-leading position, we are confident it will make a positive contribution to customer lifetime value in coming years. Our Marketplace has been operational for just over a month, in which time we've added about over 5,000 SKUs, with a plan to finish the year with 20,000 SKUs, 3P SKUs available through Marketplace. We believe we have a compelling offer for our customers and also for our third-party sellers, as we can offer a unique proposition for access to consumers in the category. Slide 21. Looking to our FY 2024 priorities, we will continue to progress our growth agenda through store rollout, Marketplace expansion, but with a heavy accent and focus on sustainable cost reductions across the business. Additionally, as highlighted earlier, the leveraging of customer data through the loyalty program is also a big focus in informing our approach towards direct marketing and personalization. Slide 22. A brief trading update. For the last six weeks of trade, comparable store sales growth is around -9%, cycling 15.3% in the prior year. We expect this metric to improve over the course of the year as we begin to cycle flat to negative prior year growth, particularly through the second half. Watchpoint is, of course, the consumer and the impacts around cost of living. Given the continuing economic uncertainty, FY 2023 guidance cannot be given at this point in time. Thank you for your attendance today. I will now open the floor to questions. Please remember to state your name and where you are calling from. Thank you, Darin, at this time, I would like to remind everyone, in order to ask a question, please press star, then one on your telephone keypad. Your first question comes from the line of Sam Teeger from Citi. Your line is open. Oh, hi, Darin. Good morning. The first question from me would be, what month did the company move away from printed catalogs, and to what extent do you think this might have impacted sales? Because I can see a bunch of other retailers are still using the printed catalogs. Yeah, thanks, Sam. It was through the first half of the year, and, you know, we've been monitoring and tracking this, and we've actually done a sample test of, you know, reintroducing printed catalogs through the second half as well, just to sort of check that it wasn't impacting the consumer. That's what it's proven. You know, we don't attribute any reduction in sales towards printed catalogs. I think every industry is different. You know, having a baby is a highly costly experience, and so search and is a high component of the purchasing decision. We haven't seen any contraction in the number of visitations on our website, and, you know, that's the key element of the initial phases of the customer research. Excellent. Thanks. After the investment and the optimization in the loyalty program, when would you expect to see some of those benefits starting to flow through into like-for-like sales? I think, I think the compounding issue here is really around what's, what's occurring to the consumer's wallet. The consumer is, you know, undoubtedly economizing. Interest rates have, you know, had a, had a pretty significant impact across broader retail, and we're-- and our customers are not immune from that either. It's a little bit difficult to unpack, you know, the performance of loyalty, you know, relative to, you know, what's happening on a, on a more macro level. You know, we are, you know, we've got great insights. We are marketing directly. Where we market directly, we are seeing, you know, consumer up-uptake, you know, in those offers. I think more broadly, you know, we're very happy with, you know, how it's working. Don't, don't forget, whilst, you know, the printed catalog is gone, this has actually given us an avenue to, for direct marketing straight into our customers, which we didn't have 18 months ago. Got it. Makes sense. Just, in the recent months when the comps have been negative, can you talk about how variable has your store sales been compared to what it normally is? At the moment, are any of the stores loss-making? We had one loss-making store this year, which was a new store. If you look at the seven stores that we opened last year, and even just look at the most recent month of July, you know, six of those, all made positive contributions with the remainder of the network, and the same one was negative. You know, from that perspective, you know, things are still in good shape. You know, where we saw the biggest fallout in sales for the year was around click and collect, and click and collect was a channel that tripled through COVID, and then it's, you know, wound back around 25% during the course of the year. If what has happened and, you know, what we saw really was, you know, consumer staples that were more broadly available across the retail, across retail, were the categories that wound back. We saw, you know, we continued to see good growth in our baby essentials category over the course of the year. In the more recent couple of months, you know, what we've seen is, you know, those baby essential categories also being impacted. You know, we're talking about car seats and prams there. What we're sort of seeing in there is, you know, this is where the consumer is economizing. These are the most expensive items of purchase, and so, you know, there's been a, a moderate reduction in sort of average spend on those items. Got it. When that's happening, are you seeing trade down to some of your private label brands or just not spending at all? Yeah, no. It's a combination, right? Trading down. You know, if you're a, if you're a multi-car family, then, you know, maybe you might be not buying two car seats, you might be going down to one. It's a mixture of both. The largest impact has been a reduction in the average item spend. Excellent. Thanks, Darin. Your next question comes from the line of Alexander Mees from Morgans. Your line is open. Thanks. Morning, Darin. Just on exclusives, national brand exclusives went down a little bit in terms of percentage of sales from, I think, 37%-36%. Is there any particular reason for that, and what should we expect in the year to come? The decline was more due to the success of the private label products that we launched over the last 18 months. In particular, there's a mid-price point pram called the Jengo STRAND. We had another PANORAMA. They, they've been extraordinarily successful, very strong margins in those categories for us. So that, that's really been the flip, is that they've, they've grown so well. In addition to that, we've just, and as an extension of our lowering the cost of parenting strategy, you know, we've just recently launched, you know, the Jengo KALI and ZURI entry price point cots. And so, you know, we're looking forward to seeing what they will do over the course of the current year. Thank you. Just on, on gross margin, you've made the point that you are gonna be committed to, to giving customers a decent price in the current environment. The Aussie dollar is also weaker, but there are some, some tailwinds, I suppose. When I'm thinking about the gross margin for next year or for 2024 rather, should I be thinking that the second half of 2023 is a reasonable template? Look, I'm not gonna provide margin forecasts, Alex, but, you know, what we do know is we know that international shipping is in our favor this year. We've improved the margin on our loyalty redemptions, and we've also seen. Whilst the FX is off currently, we've got most of our purchases covered at AUD 0.68 for the first half, so that's encouraging. These are opportunities to continue to invest in price where need be, without actually compromising, you know, the margin profile that we're experiencing in the second half. You know, the question still remains is, you know, you know, will, will the consumer experience further pain? you know, retail 101 in a tight economic environment is be really sharp on your pricing and, and manage your costs really tightly, and that's what we're going to be doing. Excellent. Then just finally on, the balance sheet on slide 17, you talk about, your covenant ratios. I'm just wondering, I'm sure it's available somewhere else, but what are the banking limits for those covenant ratios, please? Yeah, well, unfortunately, they're kind of commercial in confidence, so we can't call those out. You know, you can assume that ours are sort of broadly consistent with the retail market. Excellent. Thanks, Darin. Your next question comes from the line of Tom Camilleri from Wilsons. Your line is open. Oh, hi, Darin. Thanks for taking my question today. The slide on the customer deciles is quite interesting. Your top 10% customer shops with you over 15 x a year. Is this a customer that's a strong user of both in-store and online, or do they have a strong preference for in-store? Then how does the business think about accessing the other 90% of your customers, and lifting that over the next year? Yeah. Our, our, our highest value customers are omni-channel customers, and they, we had some metrics in the half year with regards to that. They are shopping across both channels. In terms of, you know, how are we going to, you know, grow wallet share with those guys? I mean, loyalty, is a very important part. It enables us to access, access, a direct line of communication with those guys, and where, you know, we are continuing to sort of evolve our personalization offers. Marketplace is a great opportunity to unlock value with our loyalty customers as we broaden our range out. Rolling out store, rolling out stores around the country will give us proximity to customers, and, they will shop with us. We might have consumers that are, you know, traveling to sort of shop with us at the moment, you know, from regional areas that where we don't have store, a store presence, but they'll only be, you know, visiting once, but then not coming back in, coming back into store. We know that we've got really strong lifetime value with those regional customers. The other one, is we're gonna continue to evolve our, our online, offer, particularly around things like fulfillment. Yeah. Thanks. That's a great answer. Thanks, Darin. Just quickly on New Zealand. So three stores signals some real confidence in what the business is doing over there, and you've reached profitability in the first store. What have you learned from the Aussie store rollout that you can now apply over there in terms of store format? Like, is it a shopping center focus or a homemaker style? Can we expect similar store metrics and profitability over time? In terms of gross margins, I guess, can you think about similar gross margins in the New Zealand business near term, or do you have to kind of go sharper on price in, in order to win sales? Okay. if I missed any of those questions in answering, just happy for you to sort of restate those. Yeah. In terms of margin, in terms of margin, I can answer that very quickly. We, we've got one store rolling there at the moment. That means that we've got a lot of the product in that store that is actually going through Australia as part of the supply chain. As you add stores into that market, you will add, you know, volume, and therefore that will enable minimum order quantities to be met, so you can actually start sort of moving containers directly into that country and also, so it will give us scale. I'm not too focused on margins in that economy at the moment. I mean, at the moment, you know, the differential broadly reflects the additional freight leading into that country being via our Australian DC. In terms of what's informing our strategy into the New Zealand, we are, I think, very sensitive to, you know, what are the products that the New Zealand consumer loves, and making sure that we're ranging those. So, you know, in particular, you know, that has meant some tailoring of our offer in the car seat category. The New Zealand market has got a, you know, mandatory standards that pick up both the Australian and American environment. Mm-hmm. you know, that's meant that we've added some ranging there. Yep. The cost of doing business is lower in New Zealand than it is in Australia. You know what we might, you know, drop in margin sort of make up in terms of cost of doing business. However, I mean, I think really that's it. You know, what we're sort of seeing at the moment is a fragmented sort of retail environment, much what we was evident in Australia, you know, way back in 2000, even 2017, 2018. As we grow scale, particularly in the Auckland market, you know, by the end, by the sort of first quarter of 2025, we will have, you know, stores, you know, to each point of the compass in that market. You know, it is a bit of a market that's difficult to get around, you know, due to the water lines there. You know, that's going to, you know, really help our brand awareness and, and, you know, with performance overall, and then we get to scale things like, you know, marketing spend in that, in that catchment. Great. Just on store preference, so your preference, preference for your larger format or smaller format stores. Are you seeing as, as a result of the store rollout, the, a material uplift in your online business that you do in New Zealand from awareness? Right. It will be, it will be a consistent format. That format is not present in that market at the moment, and so that's, that's the important part of the opportunity. We're bringing a range that, you know, the New Zealand consumer hasn't previously experienced. So, you know, that's the format strategy. It's held us in good stead in Australia. You know, what we saw in Australia is particularly, you know, when we got insights from, you know, the from our competition, is that, you know, we would do a 3x of revenue relative to them because of the range that we offer. It is a one-stop baby shop, and, you know, the cus-- it really resonates with the customer. Then when you overlay that with, you know, an investment in service, I mean, and service and advice, you know, it's a really strong combination. Great. Thanks, Darin. Your next question comes from the line of James Casey from Ord Minnett. Your line is open. Good day, Darin. Just on New Zealand, you've provided a bit of information there. With the additional three stores in New Zealand coming on stream in 2024, would the losses be of similar magnitude to those, of FY 2023? No, no, they, they should, they should improve. We should definitely see an improvement in that. Lower losses? Lower losses. Yeah. Okay. The marketplace opportunity in, in kind of year one or year two, would that be as much as a, a single store contribution initially? Is that how you're thinking about it? Trying to get a feel for what sort of sales can be generated from that. Yeah, potentially. I mean, it's, it's, it's a commission model, right? It's third-party products. The commission is, is a, is 100% return on sales. Whatever the commission is you earn, that's what you book, but that's also the contribution to the sales line. Yeah. So it'll look a little bit different. You know, the fixed costs in terms of the, the team that'll be working in our Marketplace channel is around AUD 900,000 a year. Really, you know, our ability to deliver a positive contribution through that channel will be the number of, the number of SKUs multiplied by the average spend per SKU. That, that's really what that looks like. Won't have, won't have the contribution to the top line, but it will be margin-enriching. Okay. Just finally, I think your longer-term aspirational target was a 10% EBITDA margin. Obviously, it's fallen back this year, you, you did achieve that in FY 2022. Is that, is that where you think the business can get back to? Absolutely. That's, that's the focus. You know, you know, we need to, you know, work through the current trading environment. You know, the Australian business did 10.4% from an EBITDA margin perspective. You know, to, you know, leverage our cost base in, in New Zealand, you know, that needs, you know, all stores to be rolled out there. We're targeting 10 stores in that, in that market. If I sort of reflect back over the last four years, whilst, you know, our margin peaked at 38.6% in FY 2022, within that, we were still actually experiencing not peak FOB, but at that point, the FOB import rate for containers was 3 x the historical average. Even within that margin performance that year, there was opportunity to, there's opportunity for, you know, further growth over time. You've got things like Marketplace will add, add further, further margin. We're, we're confident we can certainly get back to those levels. You know, it needs all, all elements working together. We need to make sure that, you know, we're, you know, we continue to introduce efficiency into our operating model. That will enable, you know, scaling our current cost profile, as we roll out and then roll out stores, we get leverage. Whilst focusing on customer value over time, there are certainly opportunities, particularly through the supply chain, to improve our margins. Okay. Thanks, Darin. Cheers. Before we continue on to the next question, if you would like to go into the queue to ask a question, please press star one on your telephone keypad. Your next question comes from the line of James Bales from Morgan Stanley. Your line is open. Hi, Darin. Thanks for taking my question. Firstly, on cost of doing business, that was AUD 162 million in FY 2023. Is the guidance of a AUD 6 million-AUD 8 million improvement, does that imply AUD 154 million-AUD 156 million for FY 2024? No. What you've got coming through, James, is we'll open five stores this year, and we're annualizing, you know, the seven stores that we've opened this year. You know, what you'll see is you'll see a reduction in the overhead to the administration line of around, you know, AUD 5 million-6 million. Then, you know, then there's, you know, work on marketing, warehousing, and so that's really where we are. We're, you know, also focused on, you know, store efficiency such that we're, you know, defraying the impacts of inflation through that cost line. Okay, just so I'm clear, the, the term net was used there. What does that refer to? That refers to the existing cost base. but what you're doing is you're adding new stores. Whatever our new stores add to our cost base, that is the increment. Okay, got it. No, thanks for that. Then just on CapEx- For example, sorry. For example, for example, we added seven new stores this year. We opened about four in the preceding year. That added AUD 7.5 million to our cost base in FY 2023. If that helps. Okay, AUD 7.5 million cost base increase from the seven stores that you added in FY 2023 is a pretty good guide in terms of- The four stores that you randomized. Okay. Yeah. Yeah. Yeah. Okay. Then CapEx, you sort of talked to the store CapEx basically being proportional to how many stores you're rolling out, five versus last year seven. For the remaining CapEx budget, should we expect that to be flat year-on-year? Yeah. It will be. The, the, the investment that will go down this year will be the, the one-off, project, transformation project costs. You know, that's, that's going to be around AUD 1 million. It was around, was it AUD 4.5 million-AUD 5 million in FY 2023. Yeah. Okay. the one- That's really the changing variable. Okay, the, the transformation cost will, for this year, will be capitalized? No, no, it's, it's not about that, but we've, we've referencing back to the presentation. I mean, our investment in payroll and time and attendance, those people systems are fully done. What we were planning on doing was then going, you know, full project team, investing heavily in ERP point-of-sale. You know, that's gonna be a slower rollout over the course of the year. That will reduce, you know, the one-off transformational spend this year relative to last year. Okay, that's helpful. Then one last one. I know it's hard to sort of give a forecast for Marketplace GMV or sort of revenue contribution for FY 2024, but you guys must have a longer-term view of how much of sort of group GMV Marketplace could produce on a sort of, you know, five-year or maybe longer-term view. Could you sort of share some thoughts on that and how we should think about how it should scale relative to the existing business? I actually look at it a little bit differently than you. We've spent AUD 1.5 million to stand up a platform that will allow us to, in one year, increase our SKU range online by 400%. We've got around, like, I think it's around 5,000 SKUs of 1P, five to seven, 1P product at the moment. We're adding 20,000 SKUs to that. It's a, I think it's a pretty low-risk investment, you know, given the scale of the opportunity. There's a AUD 1.5 billion market for online baby goods in Australia. You know, we're currently around AUD 100 million-AUD 110 million, I think, of sales within that market. You know, it's a huge opportunity for us to sort of grow our market share, but without taking on the true risk. We really need to, you know, let this roll through for, you know, 12 months and let's look at what the profile, you know, of performance does, you know, to really sort of get a good read on what the potential is for the investment marketplace. Okay. Thanks, Darin. I appreciate the help. As there are no further questions, that does conclude today's Q&A session. I'd like to hand back to Darin for any closing remarks. Thank you, Paulie. I just want to say, thank you for everybody that's joined the call this morning. This concludes today's conference call. You may now disconnect.