Thank you for standing by, and welcome to The a2 Milk Company Limited FY 2023 results call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to David Akers. Please go ahead. Thank you. Good morning, everyone. Thanks for joining the call today. Starting on slide three. On the call today, we have David Bortolussi, our Managing Director and CEO, and David Muscat, our CFO. We also have the leaders from our regions, Li Xiao, Yohan Senaratne, Eleanor Khor, and Kevin Bush. The team will present FY 2023 group and regional results, as well as our outlook for FY 2024, and there'll be time for questions at the end. I'll hand over now to David Bortolussi. Thanks, David. Good morning, everyone, and thank you for joining the call. It's been a big year for a2. We've certainly got a lot of ground to cover today, so I'll move quickly. Firstly, I'm pleased to report that our FY 2023 results are in line with our guidance for double-digit revenue and earnings growth. The result was driven by strong growth in our China segment. Sales increased by 38%. We achieved record market share in our China label IMF. In the past year, we stepped up marketing investment by NZD 30 million to NZD 260 million, which was a record level of brand investment for the company. We're seeing this increased investment translating into new highs in our China brand health metrics. Total IMF sales grew by over 8% in a market that declined by 14%, which is a remarkable achievement, resulting in a2 being a top three absolute share gainer in the China label and English label market overall. Of course, a key highlight for the year was the successful re-registration of our China label IMF product by SAMR, which we're very pleased about. Moving to slide five, which summarizes our financial results. Revenue for the year was NZD 1.59 billion, up 10%. EBITDA was NZD 219 million, up 11.8%, with an EBITDA margin of 13.8%. Our net profit after tax, including the non-controlling interest related to China Animal Husbandry Group's 25% interest in MVM, was NZD 144.8 million, or NZD 155.6 million, excluding carry proportional MVM loss. Our EPS was up 28.7% to NZD 0.212. Our closing net cash, cash position was NZD 757 million, which was after completing our on-market share buyback, through which we acquired NZD 149 million of our own shares. As expected, our cash conversion was 68%, significantly lower than last year. David will explain this shortly. This slide also shows a breakdown of our revenue growth, which was driven by our China segment, achieving strong growth in China label and CBEC sales, while ANZ sales were down, reflecting the change in our distribution strategy and a market shift towards CBEC. U.S. and MVM sales also increased during the year. In line with our guidance, second half growth was slower, mainly due to a sharp decline in the Daigou channel and cycling of higher lockdown-driven sales in China in the fourth quarter of FY 2022, which we have highlighted previously. Moving to slide six. Despite the challenges we've experienced in the market, I'm proud of our team's many achievements during the year, which include gaining record market share in China label IMF, in-store and online, reaching new highs in China brand health, receiving SAMR approval, which is a significant process to go through, increasing English label share in CBEC and in the combined Daigou and O2O channels, and our 618 and Double 11 performance, which was strong. During the year, we also ramped up innovation, improved or maintained our key business health indicators, such as market pricing, early stage share, channel inventory, and product freshness. We're also very pleased to extend our strategic partnership with China State Farm and CNADC Group and have accelerated our supply chain transformation and MVM utilization initiatives. In the U.S., we were granted FDA enforcement discretion and progressed our long-term FDA IMF approval, while also reducing our operating losses. From a sustainability perspective, we advanced our program significantly, which I'll cover shortly. Turning to the next slide, which demonstrates the impact our growth strategy is having in market. On the left-hand side of slide seven, you can see the significant year-on-year improvement in our China health brand metrics. Unprompted awareness increased to 23%, and our key loyalty metric, brand used most often, increased to 16% in our segment. The slide also shows a significant growth in our market share in China label channels, with MBS share increasing to 3.4% and DOL increasing to 3.3%. It also shows our share in English label channels recovering, with CBEC increasing to 22.6% and the combined O2O and Daigou channel increasing to 20.8%. Moving to the next slide, you can see that all of this has been achieved in a very challenged market in China, which has been mainly driven by the cumulative impact of fewer newborns, as well as the market-wide transition to the new GB product. The charts on the left show the significant market declines in the MBS and DOL channels from July 2021 through to June 2023, with a decline in the ultra-premium segment for the first time. The chart on the right shows average market selling prices for IMF from December 2021 to the end of FY 2023. This clearly highlights the decline in ASPs in the market, coinciding with the beginning of the GB transition process around double eleven last year, as brands increased their promotional activity and discounting to clear old GB inventory. Slide nine highlights how significantly the English label market has been impacted by contraction in the Daigou channel over the past five years, including a further sharp decline this year of 39%, which impacted our sales in the second half. This has resulted in the Daigou channel as a proportion of total English label sales, more than halving from 57% in FY 2019 to 27% in FY 2023. It also highlights the shift towards the CBEC channel, with more English label users preferring to shop online, which is where we have been investing in our execution capability and growing share. This is all consistent with our distribution strategy, as shift to more controlled channels in CBEC and O2O. Notwithstanding these market challenges, there are several key segment trends which continue to support our growth strategy, as outlined on slide 10. Firstly, our China label products compete in the ultra-premium segment, which now represents well over half the total market. Secondly, the continued growth in the A2 protein segment, which is growing rapidly in China label product in particular, now accounting for 13% and 15% of the MBS and DOL channels, respectively. Thirdly, brand concentration is increasing, with the top 10 brands continuing to gain share of the market and with concentration within the top 10 also increasing. Despite the significant challenges in the China IMF market, we are well-placed from a strategic perspective, and our execution continues to improve. Moving to our outlook for FY 2024 on slide 11, I'll make a few comments here that I'll also direct you to our results, commentary, and outlook announcement made today, where we have the full version of our outlook, which includes more detail. From a market context perspective, we expect FY 2024 to become more challenging, with a further double-digit decline in value in the China IMF market. This is mainly due to, firstly, volume declines due to the rolling impact of fewer newborns in recent years on later-stage IMF products, and a lower number of newborns expected this calendar year due to the lagged impact of COVID-19, prior to an expected increase in the 2024 calendar year. Secondly, lower ASPs due to the market-wide transition from old to new GB product, excess manufacturing capacity, and challenging macroeconomic conditions. The company will continue to execute its growth strategy in FY 2024, focusing on growing share in IMF, as well as commercializing other opportunities in adjacent categories and new markets. We expect to continue to gain market share in IMF, with growth dependent on the extent of market share gains in a declining market. China label is expected to outperform English label. Overall IMF growth is expected to be second half-weighted as we manage our new China label transition, primarily in the first half. Noting English label is cycling a relatively strong price period in the first half of 2023. We're expecting growth in other nutritional products and modest growth in ANZ and USA. NPM sales are expected to decline significantly with the insourcing of A2 product and lower GB market pricing. With this market context, we're expecting to achieve low single-digit revenue growth in FY 2024. Gross margin is expected to be similar to FY 2023, with cost of goods sold headwinds and channel and project, sorry, channel and product mix impact, offset by price increases and cost mitigation initiatives. Stepping down the P&L, we're planning for a further increase in brand investment in line with sales to support our China label product launch and growth strategy. SG&A is expected to be similar to FY 2023. Overall, we're expecting EBITDA margin to be broadly in line with FY 2023. I'll touch on a few additional topics now before handing over to the team. Slide 12 shows our strategy on a page. We first shared this with you in October 2021, with a few incremental changes since then. Capturing the full potential of China IMF is central to our strategy. We are also focused on driving innovation to capture growth opportunities in other nutritional products, including kids, seniors, and new markets. Internally, we have recently undertaken an extensive process to refresh our bold values and standards of behavior, which are included here at the bottom of the page, underpinning our strategy and execution, which has been very well, well-received internally by our team. Otherwise, it remains unchanged and is how we articulate internally and externally our purpose, vision, goals, and strategic priority, which you will see reflected in our integrated reporting. Moving to slide 13. This slide shows our measures of success. It's had some incremental changes since we first developed it, but the metrics and targets are largely unchanged. There have been a few progress changes from the half. U.S. premium milk share and household penetration, as well as our supply chain efficiency metrics, have changed to work in progress. We've combined O2O and Daigou share due to sample size and data classification reasons, and we have changed NPN's profitability improvement to back on track. We've also included our medium-term ambition on this slide for sales and EBITDA margin for completeness, which I'll cover on the next page. Moving to slide 14. We're still on track to achieve our medium-term ambition to grow sales to $2 billion and improve EBITDA margins in the teens over time. Our ambition previously noted that target EBITDA margins would probably be in the teens, but could possibly be in the low to mid-20s, subject to market conditions, English label market recovery, and market share gains. Notwithstanding our significant market share gains, given the challenging market conditions and significant decline in market value over the past two years, it is even more unlikely that EBITDA margins will exceed 20% over the medium to long term. As such, we reiterate that our medium-term EBITDA margin goal is to be in the teens, targeting year-on-year improvement. Moving to the next slide. Our strategy is largely focused on realizing the full potential of our China opportunity. Maintaining market access and continuing to grow our China label IMF business is obviously critical to our strategy, with the domestic registered market accounting for 85% of the total market. After all of the work we put into the registration process, it was very pleasing to receive SAMR approval in June. This was a highlight for the year, and our new GB transition continues to be the high priority initiative for our team. Production of our new product commenced in late June. Transition to market is planned to occur later in the first half, and the launch will be supported by a significant marketing campaign in the half and into next year. Overall, the registration process is likely to lead to a significant reduction in the number of China-labeled products in the market. So far, there are approximately 280, or 65%, product registrations approved to date under the new GB standard. On behalf of The a2 Milk Company, I would again like to publicly acknowledge and thank SAMR, MPI, and our China strategic partners, CNADC Group and China State Farm, and our manufacturing partner, Synlait, and its major shareholder, Bright Dairy, for their support throughout the process. I'd like to highlight our increased innovation efforts, which will support further growth. We launched a number of new products in FY 2023. Our refreshed a2 Platinum IMF range, our lactose-free milk in Australia, our upgraded a2 Smart Nutrition, and our new full cream milk powder in a tub, and lastly, our Grassfed premium product in the U.S.. We will continue to build our innovation pipeline over time, capturing opportunities not only in IMF, but also in adjacent categories and new markets. I want to highlight the continued progress we're making in sustainability. In keeping with our purpose, we're determined to pioneer the future of dairy for good, and one of our five strategic priorities is to invest in people and planet leadership. We've continued to invest in, to reduce emissions within our supply chain. Importantly, we've progressed the installation of a high-pressure electro boiler at MVM and complete electrification of the site, which is a first in New Zealand. We've also commenced an on-farm methane inhibitor feasibility study in Victoria and are scoping additional studies. We're expanding our targets across climate and nature, entered into research partnership with Lincoln University, expanded our farmer grants programs. We're also committed to make meaningful change in packaging, which requires further work. That's all I wanted to cover up front. I'll now hand over to our CFO, David Muscat, take us through the group financials in more detail. Thanks, David. Good morning, everyone. Moving to slide 19, a summary of our group income statement. Net sales revenue was NZD 1.59 billion for the year, up 10% on last year, reflecting the strong growth in the China and other Asia and U.S. segments, partially offset by a decrease in the ANZ segment. Moving down through the income statement, our gross margin of 46.5% was up on last year, driven by English label Platinum relaunch positioning and distribution model changes, the cycling and prior year stock write-downs. Distribution costs were higher in absolute terms, but lower as a percentage of sales, reflecting a mixed benefit from lower sales to ANZ resellers compared to CBEC, plus improvement in U.S. trade growth. Our marketing and other SG&A increased materially in line with our growth strategy, which I'll come back to later. Net interest income was also up materially due to higher interest rates. Net profit after tax for the year was AUD 155.6 million after non-controlling interest in MVM, up 26.9% on last year. Finally, EPS was up 28.7% to AUD 0.212 per share, reflecting the earnings growth and the lower weighted average number of shares due to our share buyback. Slide 20 summarizes our segment performance and illustrates the outstanding performance of our China and other Asia segments, up 38% on prior year, and now by far our largest segment in terms of both revenue and EBITDA. Our ANZ segment was down 30.2%, mainly reflecting the further sharp market decline in the ANZ Daigou channel and the changes to our distribution model to more controlled channels, which Yohan will cover shortly. Moving to slide 21, which summarizes our performance from a product perspective. We again achieved growth in all product categories, with IMF sales up 8.4%. Pleasingly, our other nutritionals, which include a2 branded plain and fortified milk powders and UHT products, grew by double digits during the year. On slide 22, you can see our gross margin percentage improved to 46.5%. The increase reflected benefits from our a2 Platinum English label refresh positioning and the distribution model changes that we implemented in FY 2022. It also reflected the cycling and other nutritional stock write-downs recognized during the prior year. Price rises and other cost mitigation initiatives offset the impact of increased raw material prices and other inflationary pressures on cost of goods sold. It's also worth noting that gross margins in the second half were impacted by the timing of lower MVM sales that were second half weighted. Moving to slide 23, consistent with our growth strategy, our marketing and capability investment has increased significantly. Marketing investment for the group was up 13% for the year. In China, we increased our marketing spend by 19%, with uplifts in both consumer and digital marketing. Xiao will talk to some of the marketing highlights next. Our spend in the second half was slightly down on the first half, however, it was in line with the plan due to the phasing of marketing spend. As a percentage of revenue, marketing investment was up for the year at 16.4%. This slide also shows that our SG&A expense has increased in the period, again, in line with our growth strategy, with the investment focused on the China markets, innovation, and supply chain transformation. We are also beginning to see some operating leverage in health, with the SG&A spend flattening to 14.4% of revenue. On slide 24, the balance sheet remains strong. Cash and term deposits at the end of the period were AUD 802 million, with a consolidated net cash position of AUD 757 million. As was called out for half year, inventory increased on the prior year, mainly due to stock building of China label IMF inventory and the sharp decline in the Daigou channel and timing of CMA supply, which resulted in higher inventory stock at the end of the year. That said, channel inventory and product freshness remained at target levels across the business, and as mentioned in the outlook, we are taking steps to incrementally reduce inventory cover in FY 2024. Moving to the next slide, which shows our cash flow. Operating cash flow of $111 million, cash conversion of 58%, lower than prior year, due to catch-up payments that were impacted by COVID-19 delays that were outside of the company's control, as well as payments for China label stock build to support its new GB transition. Total cash and short-term deposits reduced by $85 million to $802 million as a result of the share buyback. With that, I'll hand over to Li Xiao to take you through the strong performance of our China label business. Thank you, Dave. It has been another very busy and a dynamic year in China. The China IMF market has been very challenging. We are fighting strongly and performing much better than the market. Today, I want to give you a few of the highlights for the year for China label. The biggest highlight is the reregistration of China label product. I'm proud of what the team has delivered through the year. We continue to reach new highs in brand health metrics. We grew share within focus accounts and outperformed the market overall. lower-tier cities remained the biggest driver for offline growth in FY 2023. This resulted in strong MBS share growth. In domestic online, our growth outpaced offline, with our biggest share gain in early stage. We also deliver strong double-digit growth in O2O, which outperformed our expectation. Turning to slide 28, as David mentioned, the China MF market has been very tough. China label market value declined by 14.9% for the year and was down 17.3% in the second half. The MBS channel was down 12.7%, and the DOL was down 4.5%. Despite that, our China label MF sales increased by 27.8% to NZD 559.3 million, with second half 2023 sales up 16%. Our strong performance was supported by significant marketing investment in brand building campaigns. In the first half, we launched our a2 Milk-based message campaign and launched our Authentic Purity campaign in the fourth quarter. It was the first major campaign that communicates our macro milk product portfolio, with a2 fresh milk as flagship product, while amplifying a2 Milk-based messages, an umbrella of a2 dairy products, including MF, which are made from precious A2 protein milk only and New Zealand, Australian country origin. We implemented innovative consumer marketing campaigns, cost effectively and with high coverage efficiency. For example, as shown on slide 30, we use more than two roadshow for wider city coverage to drive brand awareness and trial in lower-tier cities. We have big shopping mall roadshow events in key MA cities. We also delivered a corporate social responsibility campaign with Operation Smile, we engage consumer and support an important cause, as highlighted on slide 31. Slide 32 shows some of the leading industry awards we have won for our innovative marketing from Adman, Little Red Book, the China International Advertising Festival, Media Enterprise Corporation, and the IAI. We are not only increasing our marketing investment, but also being innovative and disruptive in activation or campaigns to improve the effectiveness and efficiency. We were recognized as best practice by the FMCG industry and the competition. Moving to slide 33, we are very pleased to see all our hard work translating into new highs in our brand metrics. Total awareness is up to 63%, unprompted, and the top-of-mind awareness is also increasing. We use more precise target marketing approach to drive consumer trial and purchase through the decision funnel. Slide 34 shows our performance in MBS for the year. Our record market share was driven by our performance in lower-tier cities. Our national MBS market share for China label grew to 3.4%. In BCD cities, our share increased to 7.5%, and in lower-tier cities, increased to 2.7%. We are particularly encouraged by our BCD performance and continue to be focused on capturing our opportunity in these lower-tier cities, where we have a relatively lower share. Moving to slide 35, the most noticeable thing on this slide is the significant amount of deactivated stores, under the slight reduction in our total store count. This reflects the challenges the MBS retail market is facing, and we continue to support our customers through this period, and they remain one of the most profitable trade margin brands in the category. Based on internal distribution data, we grew in new stores, and our like-for-like performance in mature stores was strong and part supported by store closures.... Based on Nielsen data, we increased our numerical distribution from 25-27 of stores, and importantly, our video distribution from 44%-47%. Turning to slide 36, our online growth. offline growth. We continue to close the gap to MBS share. We increased our overall door share to a new high of 3.3%. We also achieved strong growth within the key door platform of Tmall and the JD.com, while unlocking growth in other platforms, Douyin or TikTok in particular. To put all that in context, slide 37 shows that we are leading share gainer in China label IMF, among domestic and international brands. In MBS, we were top five gainer and in door, number two share gainer. To illustrate the quality of the performance further, slide 38 shows that we have gained share in all stages, both MBS and DOL. In MBS, our best performance was in phase three, while in DOL, share goals were driven by early stage sales, which is a healthy indicator that we are growing through new users rather than channel switching. Slide 39 shows that China label performed strongly in June 18. We increased sales volume by 14%, improved our ranking from 16 to six in Tmall flagship stores, and from 11 to 10 in JD.com authorized store. The share of sales volume in Sichuan and the two increased from 29% to 39%. A strong result overall, without heavily promoting our brand during the sales event. Now, I will pass to Yohan. Thank you, Xiao, and good morning, everyone. It was a very challenging year for English label, given the significant challenges in the market. I will quickly highlight some of the progress we've made in the business. A major focus during the year was the transition to our refreshed a2 Platinum range across all English label channels. Due to the further decline in the Daigou channel, we had to pivot further to the more controlled channels in CBEC and O2O, including directly managing third-party pop stores in CBEC and refining our O2O distribution by leveraging our China offline network. Overall, despite challenges, channel inventory is at targeted levels, and we continue to hold a strong share of voice within the Daigou channel. I'm also pleased to note that we grew our market share in CBEC and in the combined O2O and Daigou channels. Let's go through the results itself on slide 41. The overall English label market, in value, declined by 14%. The Daigou channel was down 39.5%, and O2O was down 17.9%. Conversely, the CBEC market grew 8.3%. Our net sales revenue was down 6.1% to AUD 548.7 million, with a major shift within English label channels, reflecting the continued refinement of our English label distribution model and the deliberate shift in sales to CBEC authorized distributors from ANZ resellers. Slide 42 illustrates the significant sales shift in channels. Daigou has shrunk significantly in absolute terms and as a proportion of total sales, while CBEC has increased to 44% of English label market value. On slide 43, we show our multi-channel marketing campaigns across ANZ and China during the year. Slide 44 shows how we are focused on building digital marketing and e-commerce capability to further improve execution, which is having an impact, particularly on new user recruitment. This is across major platforms as well as emerging platforms. Slide 45 highlights a case study in the O2O channel from one of our key account partnerships with Momtime, which is the largest O2O retailer in our category. Taking a look at our share outcomes on slide 46, we're very pleased to show share growth again in CBEC, as well as in the combined O2O and Daigou channel. Whilst our English label focus going forward is likely to be on CBEC and O2O, given the recent evolving dynamics, we will continue to support the Daigou channel through multi-channel consumer marketing campaigns and reseller trade support programs. Finally, on slide 47, we show our performance in 618, where we grew sales volume and held very strong rankings across platforms. With that, I'll now hand over to our Managing Director for ANZ and Strategy, Eleanor Khor. Thank you, Yohan, and hello, everyone. Whilst I like the investment community, I'm pleased to be here today in the capacity, leader of our ANZ business. My way of key messages for ANZ liquid milk business, FY 2023, for the launch of a2 Milk Lactose Free product, which was the most successful growth refreshment product launch in Australia in FY 2023. The launch of a2 Milk Lactose Free offset the impact of reduced consumption of our core range, following the easing of COVID-19 restrictions, which benefited higher in sales and the impact of more challenging markets and visibility effects of rising interest rates and inflationary pressures. Overall, turning to slide 49, we delivered net sales revenue growth of 7.1% to NZD 184.1 million, growing in the second half of 8.5%, supported by 5.3% in the first half of FY 2023, and strong performance by Lactose Free products. Our market value share of 11.3% is down on last year, but similar to pre-pandemic levels. As a business, we're very proud of the success and contribution of a2 Lactose Free to our results, with sales performing ahead of expectations and with distribution expanding from our initial launch market to Victoria and New South Wales into Queensland, South Australia, and Tasmania. With that, I'll now hand over to Kevin to share key messages from our U.S. business. Thanks, Eleanor. I'm also delighted to take on a new role this year as the MD of our U.S. business. The team has been focused on building distribution and consumer engagement on both a2 Milk Half and Half and Hershey's a2 Milk in both DOL and O2O formats. We are developing a robust portfolio of innovation, which includes a2 Milk Grassfed, which was launched in the third quarter. While our household penetration for you is steady at 2.3% and with high loyalty rates versus competitors, our brand awareness dropped, reflecting our decision to reduce marketing spend and prioritize investing in China. That said, brand awareness has stabilized since the first half. Pleasingly, we achieved growth in market value share in the premium milk category for the grocery channel. Going to slide 51 and looking at the result itself, our revenue increased by 27% to $105.1 million. The first time we have delivered over $100 million in sales. Sales growth included modest growth in core equivalent volumes, contribution from new products, while pricing and favorable effects also supported the outcome. We achieved a significant improvement in our EBITDA loss, accelerating the path to profitability in the USA by FY 2025 or FY 2026 remains a key strategic priority for us, which we expect to make further progress on this year. With that, I'll hand back to David Bortolussi. Thanks, Kevin. A few points on MVM before we move to Q&A. We delivered net sales revenue of NZD 114 million in FY 2023, the first full-year under our ownership. We reported an EBITDA loss of NZD 26.5 million, slightly higher than last year on a pro forma basis due to G&A and FX volatility, reduced demand from third-party customers in China, increased investment in capability, significant product development trials, and investment to support future nutritional powder production. We've accelerated the execution of our supply chain transformation strategy, including increasing raw A1 free milk supply, completing the insourcing of all A2 milk, whole, and skim milk powder products. Completing production trials for insourcing a certain IMF product, with manufacturing to commence in the first half of 2024, and commencing production trials for a new English label IMF range, all with MVM and new blending and canning partners prior to installing similar to that capability at MVM. I'll pause there, and with that, I'll hand back to David Akers for Q&A. Thanks, David. I'll ask that when we take questions, that they're limited to two questions, and then please rejoin the queue. Travis, can you please open the questions? Thank you. If you wish to ask a question, please press star one and wait for your name to be announced. The first question today comes from David Errington from Bank of America. Please go ahead. Morning, David. David, I'll start off with a very broad question, because I'm probably as confused as an analyst as I've been in my career. As a company, when I look at your metrics, your market share, your brand awareness, your company probably has never performed better. You're operating really off the top shelf, and your management team, you know, my colleague, Julia Disterke, said to me, "As a management team, we gain a lot of confidence in your performance today on these operating metrics that you've gained." You know, kudos to your management team. When I look at your stock, your stock's down 10%, and it's probably at all-time lows because of the outlook statement that you've given, and it's pretty much predicated on the basis of the current market outlook. As a CEO, can you give us investors a guide as to how you're looking at this? Are you looking at this as a cyclical situation, where we, as investors, have to wear the next six to 12 months of, of industry, you know, restructuring, you know, because you've got this excess stock that people have to clear, you've got excess capacity that people have to clear? You've got some challenges there in the market as we go through this GB SAMR, you know, this registration. How are you viewing this? Is this a structural decline or is it cyclical? Because if it's cyclical, you've got so much leverage to turn this around and really make this a fantastic investment opportunity. If it's structural, you guys are running against the wind at a rate of knots. Doing a great job, by the way, running against the wind at a rate of knots. Can you give us a bit of a strategy overview? To me, that's the most important thing on our minds as to where a2 is gonna be going in the next 12, 18 months, maybe 24 months. Thanks, David. Let me just comment first on the market outlook and then how, well, I see our performance within that. I think from a market point of view, we've been very clear, and we've been talking about this for a long time. I think it's well understood by the market, hopefully. From the market growth point of view, we're seeing a significant decline in the market at the moment, driven by two factors. One is the cumulative impact of fewer newborns over time, and the second part is a reduction in ASVs in the market at the moment. In relation to the number of newborns, I think there are well-understood sociodemographic drivers behind a slow decline in the newborns over time that the market has experienced for some time. On top of that, that's a more incremental decline. On top of that, we've seen a cyclical or COVID-related reduction in the number of newborns recently, which we expect to be at its peak really this year, late this year and early into next year. We hopefully see a recovery of the newborn rate going into FY 20— sorry, into calendar 2024. That's due in part to when, when restrictions were lifted in China, you know, prior to women falling pregnant again, they were advised not to, you know, to let time pass between contracting COVID. That's, that's sort of something that's happened all around the world. We expect newborns to increase next year. Where that eventually ends up in terms of the number of newborns in the market is to be determined, but we expect there to be a recovery and then to settle at a new point. There may be some incremental pressure on that going forward, but we know that the government is taking many steps to promote the birth rate going forward, and hopefully, that will stabilize the long-term outlook for births in China. Second, there's a cyclical impact and a structural trend there as well. In terms of the ASP impact, I think that is more cyclical because we're seeing a very disruptive year currently in this calendar year. The whole market for China label product, which accounts for 85% of the total IMF market in China, is having to go through phasing out and phasing in their new product under the new GB standard. That's a very significant event for the industry, and we've highlighted in our presentation the impact that that has had on ASPs in the marketplace. We're seeing that the new product that's been introduced into the market is at higher ASP, and hopefully after that stock is cleared out of the market, we'll see a return to premiumization within the IMF category. Hopefully that is cyclical, David. In terms of our performance, you know, our brand health has gone to new highs. It's never been so strong across all our metrics. It's up 30%. We've increased the investment behind that. We're gaining share in both labels, in China label and English label, in all channels. We are the number three share gainer in the market overall. In terms of our own performance, I think it's been pretty exceptional during the period, and I'm really proud of what the team's achieved. In essence, in the near term, it is really a share gain for us in a declining market, and we're really well positioned to gain share and to continue to grow into next year. That's reflected in our guidance of low single-digit growth in sales. By the way, that shouldn't really be a big surprise to the market, because not only the market context that I just talked about, but our guidance for FY 2023, which was roughly 10%, you know, that implies 3% growth in the second half, period on period, and also, you know, 3.5% on the adjacent half. To be guiding into next year with that market backdrop, us having to transition our China label product and cycling Daigou declines in the channel and our business shouldn't be much of a surprise to the market. No, I think so. Yeah, I, I think probably the market's a bit tougher, David, than what we've been factoring in, but everyone can come to their own conclusions. Again, your performance in this backdrop is, is outstanding. That's my opinion only. My second question, I suppose, don't want to take up too much time, but I'm just wondering how you can maintain EBITDA margins relatively flat this year, when, say, if you're looking at low single-digit sales growth, flat gross margin, and you're obviously going to have to increase brand awareness, you know, significantly again. I'm just wondering how you can keep EBITDA margins flat. You must be looking to take, you know, costs out of the SG&A line. Is that true? Because I would have thought there'd be more pressure on SG&As going forward, just with cost inflation, et cetera. I'm just wondering how you can hold on to your EBITDA margin in a flat gross margin world and also with only low single digits. Yeah, we'll get a little bit of leverage out of SG&A to support that. We're guiding to gross margins being similar, David. We tend to increase our investment in brand again in line with sales. Where we expect to get some leverage is in SG&A. Overall, I mean, it will depend partly on the top line, because we are obviously a high-margin business in the infant category. Overall, we're guiding to EBITDA margins being broadly in line with last year, and we should be able to achieve that. Okay. Well done on your operating performance, David, and let's hope the market turns for you. Thanks, David. Appreciate it. Thank you. The next question comes from Marcus Curley, from UBS. Please go ahead. Good morning, David. Just two questions. First, on the English label performance, you mentioned in the presentation, again, no sign of a Daigou recovery. Yet, I just wondered if you could provide a little bit more color in terms of, you know, you know, what you're specifically doing and whether you think that there is, yes, you know, what level of chance do you think there is of a recovery at some stage over the course of the next 12 months, given the... As you say, the customer base is rebuilding. Marcus, I might hand over to Yohan to talk about that, if that's okay. He can talk more specifically about what we're doing. Hi, Marcus. I guess in, in terms of the, the English label market and with the Daigou channel, you know, what we've seen, and, you can see it on some of the slides, is a change over the pandemic period of consumer sentiment and consumer behavior, right? Historically, the CBEC channel was a, you know, transactional channel where for those that had already been recruited into the brand via the Daigou channel. The next generation of consumers are, are quite comfortable commencing and completing their purchase journey online. You can see that in the, the channel split of English label sales biasing more towards CBEC and away from, from Daigou. That, that trend has, has been sustained now for a number of years. In terms of, you know, the future for Daigou, I think it'll continue to be challenging. It's great to see that international students have returned to Australia, and international students have historically been a source of new Daigou. The other element is tourism, and it was also great to see that Australia was put back onto the list of approved locations for Chinese tour groups to come to Australia. You know, that the tourism sector will take a little while to catch up to pre-pandemic levels, and there may be some, some benefits of that to the Daigou channel. I think the bigger, bigger challenge for the Daigou channel is actually the change in consumer behavior and movement towards online channels. In terms of what we're doing, of course, yes, we'll, we're, we're biasing our investment towards, you know, CBEC and O2O to drive share in those channels. Also we're, we're supporting the Daigou channel. What we're observing is that this generation of international students and potential Daigou are not exactly the same as previous generations. As an example, you know, they, they see themselves less as Daigou and more as perhaps influencers or brand ambassadors. You know, the challenge for us is to find ways in which we can meet them in the way they want to sell. We're running trials and looking at different ways in which to engage with the Daigou model. We'll continue to work with the Daigou community, but recognize that there has been a change in the, in the behavior and the way it works. The market is. Secondly, just one... Sorry. You go. Sorry. Then secondly, on the gross margin promise, David, you obviously, you called out in the release, you know, a few headwinds and some tailwinds. You know, I just wondered if you could comment around, you know, the scale of some of those, you know, headwinds. Obviously, the tailwinds seem like they could be quite material given, you know, where, you know, dairy ingredients costs are today. Specifically, yeah, have you allowed for any greater levels of promotional or discount activity for the China label business as you transition from the new to the old product? Great question, Marcus. I'll let David Muscat, give you a bit more color on margins. Yeah. Hey, Marcus. Yeah, you're right. There's quite a lot of noise in our margins next year, and that comes through the outlook statement. I think probably the larger elements in terms of those headwinds is the, as we said at the half, is the CL reformulation and packaging changes, which will come through, as we, as we relaunch or as we launch the, the registered product. Ingredients prices were actually a negative for us, will be a negative for us, in FY 2024. One thing that's very important, for you to understand is that, there is quite a significant lag between the prices that you see in the market, the commodity prices, versus when we see it in our COGS. Right now, in terms of the, in terms of the, the prices, so on IMF, the prices that we're, that we've got from Synlait, we're seeing some benefit on milk prices. We are not seeing any benefit yet on ingredients prices, that's partly also tied into the fact that raw material levels have been quite long with Synlait, partly driven by the COVID disruptions and the war in Ukraine. That has meant that they've, they've, they've, they've procured more stock, and also with the decline in some of our purchase orders related to English label, they're a bit long, too. The ingredient benefits won't come through probably until the back end of this year, probably not even into the start of next year. They're probably the two biggest headings, and like I said, we are seeing some of the benefit of the lower GDT prices come through within the COGS of our IMF product. And David, any allowance for? Oh, sorry. Yeah, sorry. Yeah, that's all embedded into our. At the moment, our GB transition in terms of stock, stock build and everything is all on track. In terms of our execution of the transition, that's all embedded into our guidance. Is the strategy there, you know, to look to discount end-of-life stock, or, or do you, or are you sort of comfortable with a, you know, sort of transitioning old to new? Marcus, just David back in. Even though you can see what's happened to MNCs in the market, as we've illustrated, we don't expect to have that same level of pressure on our transition. Our brand is very strong, our product is in high demand. We'll manage that transition carefully. Sure, there will be additional promotion of discounting activity and stock movements to manage the transition. There may be some inventory write-offs, of which we already have a small provision for. We think that we've got all that covered, and we think that all things going well, we'll manage that transition smoothly in the first half and into the early part of next, the second half. Okay, thank you. The next question comes from Peter Marks, from Barrenjoey. Please go ahead. Good morning, guys. I've just got a question on the FY 2024 margin guidance. It's actually the opposite of David's before. 'Cause when I look at it, I, I think presumably the U.S. and the MVM losses should improve into FY 2024, which should give a bit of a natural margin improvement to the group. On top of that, you're guiding gross margin flat and marketing to sales flat. So shouldn't there actually be a bit of an improvement in, in the overall group EBITDA margins? Yeah, David Muscat. Yeah, but I think, so, so yes. So and that's in, and you see that's embedded into our outlook statement with respect to gross margins. But on the flip side, you've got, as I discussed before, the CBEC and the ingredients pressures, but also you've got the mix of the mix of channels. So with Daigou expected to come down significantly in the first half, that's a, that's a negative. That's a negative for us. And also, you know, CBEC is slightly slightly less profitable than DOL as well. So there's some, there's some mixed impacts coming through, offsetting some of the benefits of the expected improvement in losses in the U.S. and MVM next year. Okay. Then just on MVM, was there some sales that slipped out of the second half and presumably into FY 2024? What was the profit impact of that? No, I don't believe. No, there was no sales that slipped. If anything, our sales in the second half of 2023 were, were, were quite high. No, from a commodity point of view, we, we try and clear the season. No, nothing, nothing material there. Yeah. Then on the... Just on the China label outlook, were the, were the pricing or the discounting, pressures significant in the second half of 2023? Like, did you have to discount in, in response? Because it looks like from that chart, it looks like Key & A cities were actually, like, the pricing impact wasn't that bad. I guess, going forward, do you think the, the worst of that pressure will be in the first half 2024? In relation to the half that we've just had, no, we, I mean, as I said, our brand is very strong. Richard and the team have managed that, the pressure from the market, very well. Our pricing has been similar in the market. If anything, our ASPs in the market are as strong as they've ever been, and potentially up in some channels as well, which is really important to us because the pricing in the market obviously, is a key influence on trade margins and distributor margins as well. The brand is in really good shape heading into this transition in the first half. I hope that sort of helps and go around that. Great. Thanks. The next question comes from Stephen Ridgewell from Craigs. Please go ahead. Yeah, good morning, guys. My first question is just on the medium-term margin targets. I just, can you please clarify the reference to, you know, the medium-term margin target to be in the teens? Should we interpret that to be kind of mid-teens or, or high teens, which is quite a debate in the market at the moment. Then to the extent that you are expecting EBITDA margin improvement to occur, you know, roughly when should we expect this to occur? Just keeping in mind your plan to go multi-brand, you know, from 2024 calendar year onwards, and the brand investments you likely have to make to support that. Just give us a sense of how a2 is looking as a margin improvement story into the medium to longer term. Thank you. We haven't provided specific guidance of where, where in the teens. We've just made it clear that our goal is to be in the teens, and we're targeting year-on-year improvement. I mean, clearly, with our guidance going to FY 2024, with the challenges that the industry is facing next year, we're guiding to margins being broadly in line with last year. So, you know, we'll, we'll. Of course, we will try and target an improvement in that. That's our guidance as it stands at the moment. And we hope to improve margins going forward year-on-year. But we're not, we haven't provided any guidance as exactly the extent of that improvement within the teens, nor the timing thereof. There's a number of factors that will influence that going forward. I mean, David Muscat just talked about some of the, you know, from a, from both from a, kind of, I guess, a, a margin dilution and accretion point of view. David was just talking about the, the impact of the new China label product, which is likely to be lower margin than the current product. Our China label business, we've, we've guided, saying that we expect that to continue to outperform our English label business. There's a product margin and mix impact of that from a dilution point of view. You raise innovation. You know, some innovation may be accretive, but it's equally quite possible that innovation going forward, in instant milk and other categories may have a dilutionary impact on margins going forward. On the other hand, you know, we've got MVM as we continue to in-source and reduce the profitability- sorry, improve the profitability, reduce the losses on MVM. That'll show up in margin improvement from an accretion point of view. We've also got the U.S. losses, which we've clearly indicated to the market, that we plan to address those and bring the U.S. to breakeven going forward as well. Lastly, I'd say from an accretion point of view, over time, we expect to get more leverage from our SG&A spend as well. Potentially brand investment, but certainly from SG&A going forward as well. All in all, you know, we're confident that there is a EBITDA margin improvement opportunity for us, and we're very focused on capturing that. We know how important that is to our shareholders, but we're not giving specific guidance in terms of the extent of it, nor the specific timing of it, other than that we are targeting year-on-year improvement. Okay, thanks. That's helpful. Just my second question was just on store count in China. You know, the contraction in the retail store count was a little bit of a surprise to me. I appreciate the, you know, the backdrop that the industry itself is shrinking is, is no doubt being a headwind there. Just interested to know management's thoughts on, you know, if the slow SAMR renewal, so clearly being one of the later brands to get approved, may also have partly been behind this. We had heard from some channel checks that might be an issue. Then are you able to make any comments on whether you would expect to see increased store distribution count in the year ahead, please? Thank you. I see. Xiao, would you like to answer that question? The question relates to the reduction in our distribution during this period, and then also in terms of number of stores and store count, and then the market changes which are happening around that. Also as we move to our new China label registrations, is that likely to provide any pressure in terms of our distribution growth ambition? Yeah. Most of the, I mean, store, store count is coming from, I mean, the store closure. We see, I mean, even a faster store closure, I mean, after COVID-19. And, I mean, that, that impact our, our temporary distribution account, not the distribution numbers. But I think, on the other hand, you see that our numerical distribution tracked by Nielsen is increased from 25 to 27. I mean, we are showing growth on the Nielsen data. This is a reflection. Our store closure actually is less, much less than the market. Then if you look at, I mean, the, the visit distribution, which is a more important indicator, that, our visit distribution is improving from 44 to 47, which is the quality of, I mean, distribution rather than, I mean, the quantity of the distribution. I mean, looking at the challenging IMF situation, I mean, in short term, there is a challenge on the store number. But I mean, we are pretty positive that, I mean, we are keep on expanding on quality store expansion to the lower-tier city. Hopefully, I mean, when the market stabilize, we are going to see, I mean, this growth again. Also on the other side, you see, I mean, store count is not the only way to go to the lower-tier city. Like in the recent, our expansion, through TikTok, which is almost 60% of their consumer coming from lower-tier city, as well as store. There's multiple channel has enabled our expansion into the lower-tier city. Thank you. Thank you. The next question comes from Richard Barwick, from CLSA. Please go ahead. Thank you. Good morning, all. First question is around the FY 2026 targets as well. You know, I guess let's talk about revenue for starters. I know that the, the way they've been expressed is always FY 2026 or beyond. And I just think given the, the birth rate for calendar year 2023, is shaping up to be weaker than expected, and certainly weaker than where I guess we all were thinking back when you introduced the targets at the, the strategy day in 2021. How, how are you feeling about the, I guess, the 2026 or beyond? Is this- this, the NZD 2 billion revenue, you st- you think that's more likely a 2026 outcome or a 2027 outcome? Richard, your, your opening comments are fair. I think the, the market conditions have clearly been more challenging than we expected. Equally, our execution since October of 21, I think, is in, in many ways is ahead of expectation. Mm. Our growth over the two years is high. At that time, we would have had to have delivered a 10.7% CAGR over a five-year period if we achieved it in FY 2026. To date, I think it's 14.9. The three-year CAGR to get to ambition in FY 2026 will be 7.9% growth. Against that, we've got headwinds on market conditions. We also have... Don't forget about MVM, which has kind of got an internalization reduction in sales, so it does make that target challenging. At this stage, you know, our board and management team are committed to achieving it as soon as possible. As you would expect, we've set ourselves an internal target to achieve it by FY 2026, but our guidance to the market is by FY 2026 or later. If it becomes apparent to us that we're not gonna achieve it by 2026, then we'd let you know that. In the meantime, we're still targeting what we've said. I hope that we can get there by FY 2026, but there's no guarantees. Okay. All right, I guess part of that is that, yes, you're right. The three-year CAGR is 7.9, but you're obviously guiding to lower than that this year, so the implication being the CAGR into 25 increase. Yeah, higher in the outcome, obviously. But, I don't think that's not, that's not impossible. Like, there's a lot of things, you know, in terms of execution, we're clearly executing well with one brand and two labels. Our channel structure has evolved significantly. We've had to do a big pivot from Daigou to more controlled CBEC and O2O channels. The English labels, the share of total IMF market is stabilizing. We've got innovation coming our way over time. Our China business, in particular, is just executing extremely well and beating our share all the time. It's not... I mean, it's, it's still quite possible that we'll get there by 2026, and that's certainly what we're focused on. Again, I'll reiterate that our guidance is by FY 2026 or later. Yeah, understood. Thank you. Just a clarification question for my second one. On English label inventory, there's a comment within some of the releases that the high inventory at year-end obviously showing up on the balance sheet. Then I think Yohan actually made the comment that said that the channel inventory was at targeted levels. I guess there could be a bit of a disconnect between what's sitting on your books versus what's, you know, within the. Yeah through the, with your customers. Just a bit of color there, please. No, no problem, Richard. We're, we're very careful of the difference between channel inventory and our own inventory. Our channel inventory in English label and China label is at target levels. You know, please don't be concerned about that at all. Our company inventory does vary from time to time. On English label, we were slightly higher at period end for two reasons. One is that the decline in the Daigou channel impacted us in the second half, and also there were some supply delays coming from Synlait as well. So it was slightly higher at period end, which will unwind shortly. China label was slightly higher, just, you know, from ordinary course into because of the stock build and phase out and phase in of the new product, but that's all tracking to plan as well. On top of that, you may notice in our outlook statement that we have indicated, and the cash flow comment there, that we are incrementally reducing our stock cover, which we think is prudent at the moment, and also because the way that we've evolved our distribution model over time, we're much closer to market, in more control, more visibility, and Synlait's service levels have improved as well. We've got more confidence in running with less stock, so we plan on adjusting that incrementally as well. I mean, take away from this, look at our, our stock at the end of June, a bit higher than we would expect as a cash flow release opportunity there. Don't be concerned about our inventory position, either in the channel or on our books. Yep. Okay, that's great. Thanks, David. The next question comes from Phillip Kimber, from E&P Capital. Please go ahead. G'day, David. Can I just maybe, while, while you're talking about that, in-channel inventories levels, that you're talking about there, how is that sort of consistent with the ASPs coming down? I would have thought if, if, in-channel inventory levels are, you know, where they need to-- where they should be, there, there wouldn't be ASP pressure. Probably need to distinguish, Phil, between ASPs in the market and our ASPs. In the market, particularly in China label, which is the, the chart that we've put in, the presentation on page eight, that's come down significantly, less so in English label in the market, linked to the GB transition that we've talked about. Our ASPs in the market, in both, China label and English label, have been the same or improved over the period as well. It's slight, slightly different for us, which is indicative of the strength of our brand and how we're executing. Yeah. The comments I was making earlier about ASPs were market-based ASPs. When you talk about in-channel inventory, talking about your in-channel inventory, what about just generally? Is the general channel, so well now we're including all the brands out there, you know, is the, is the market overstocked in China? And whilst your levels are okay, everyone else's aren't. I'm just trying to understand how long that pricing pressure could be? Yeah. Yeah. In terms of market inventory, it's very difficult for us to have any reliable measures on the level of total inventory in all forms of the channel. What is happening, though, is obviously the transition, the phase out and phase in of new product. It's pretty evident in the market, the clearance activities that are happening around that, which is driving down, particularly China label, old GB pricing in the market over this period as the competition transitions to their new GB product. What we're seeing generally is that the new GB product ASP, significantly higher than the outgoing, which you would expect. I can't, I can't comment on exactly their level of inventory in the trade for others. Okay, then my second one just relates to slide 20, and you were effectively getting asked questions on it before. You know, that says you grew EBITDA margins are this year, 13, or FY 2023, 13.8. You've given a team's long medium-term guidance. If I look at, you know, ANZ, China, and other Asia, I mean, collectively, those two are 25%. 25 down to, let's call it 14. Clearly, USA and NBM are massive drags, and you're talking about them going to break even. You know, that doesn't mean a positive margin, but at least not a negative margin. You know, are you, are you expecting the therefore material further margin decline in ANZ and China? I'm just trying to work the maths out there. Yeah. because they're currently down 25% as we sit today. I mean, I think David Muscat talked briefly just before about going into 2024, but there will be... I mean, there's some pressure on gross margins in the, I guess, in the core business. With, you know, NBM, as we reduce the losses there, that will help support those gross margins going forward. Then at an EBITDA level, you've got U.S. losses, which we should mitigate over the next several years, consistent with our plan. Yeah, over time, with, if you think about our core IMF business, you know, whilst there are, you know, accretion opportunities I talked about before, the new registration, our upgraded product and packaging, net of price increases and other things that we may do to help mitigate that, is likely to be a lower margin product. Our China label business, we expect to outperform our English label business. Overall, we expect some pressure on margins going forward. Compensating that are some of the accretion factors I mentioned, including NBM and U.S.. Okay, thank you. Next question comes from Matt Montgomerie, from Forsyth Barr. Please go ahead. Hi, David, hi, team. Thanks for taking my questions. I might start just on China label. We've gone through a little bit, the market share gains are relatively constructive across the MBS and DLL channels. Are you able to provide a little bit more color with respect to where you think they're actually coming from? Do you think it's simply because the market's consolidating, and you're taking share as a result? Are you able to see that you're taking share against current established brands? Particularly, I'd be interested in lower-tier cities, given, you know, that's the sort of medium-term China label growth driver. I'd like if you sort of share those comments, and I'll hand over to Xiao afterwards, just to comment on the lower tier penetration. If you think about the overall market, Matt, we're well-positioned in terms of playing in the ultra-premium segment, which only is defined by a few percent relative to the overall market. The A2 category, if you like, you know, grew quite rapidly during the period as well. We're well positioned in the market. Obviously, that reflects a lot of other new entrants into the category as well. We're well positioned in the market. We're gaining significant share. When you look at our share gains in China label and English label, I mean, English label, we improved share. We're the number two player there, particularly in the Australian segment, we picked up a lot of share there. In, in China label, we're about number eight player in, in China label, and we gained share significantly in MBS and DOL overall. We've indicated in one of the pages in the deck, you can see how we're share gains in place relative to the competition in MBS and DOL. When we look at it overall, based on Kantar information, which is the best source we have, it's not, it's not always reliable because there are data limitations to it. Overall, based on Kantar data, we're the number three absolute share gainer in the market overall. You know, our share gain, I think, is pretty... Is pretty clear, in terms of the impact that we're having in the market. In terms of BCD penetration and all that, Xiao will talk about our share gains there. We've indicated what it is in the presentation. I just want to give a bit of an indication. Yeah. So the, the, we see that, in the QNA, our market share, I mean, going from 7.1 to 7.5%, which is a 5%, I mean, the growth. Well, I mean, the key growth driver coming from the lower-tier city, I mean, we are growing by 20% in the lower-tier city, market share to 2.7. You can see that, I mean, the driver of BCD expansion penetration was coming from the brand two, because you see that, even with this challenging market situation, I mean, the ultra premium segment is still taking more than half of the share. You can see that consumer, and still, I mean, the trading out to the ultra-premium segment. The ultra-premium segment is dropping. It's dropping slower than the total market. That's one two reason for consumer to purchase the brand is critical. Secondly, as David mentioned, why we are in this tough environment, we are holding our ASP stable to protect the trade economy. That being one of the most profitable trade margin brand among either MNC or the local, is going to give us a big driver for the trade recommendation. Lastly, as our activation shows that activated store is important than get store distribution there. We are, I mean, innovate, I mean, like, the kind of a nine-year-old show, I mean, which is a cost-effective activation, going to the lower-tier city, get trial as a brand explorer. I think it's a brand two, a trade recommendation from the trade economy, plus the activated store expansion into the lower-tier city is our key growth driver, which is, I mean, I mean, the lower-tier city contributes 85% of the total MF market, and we are still relatively small there. That, that's the key growth driver in the future. Thanks, Xiao. Matt, the only other thing I'll add is just from a momentum point of view. We're obviously quoting annual share numbers on an MAT basis, mainly throughout the deck. In nearly, you know, in China label and English label and by a channel in terms of share momentum, we're, we're pretty much finishing the year higher than those averages, as you would expect, because we need to gain a bit of a share going into next year to deliver our, our plan. MBS, for example, 3.4%, our June number was 3.8. BCD, which you're asking about, the average was 2.7%, for the month of June was 3% share. We've got really good momentum at the moment. Great. Now, that's very useful color. I might just change tack into sort of capital management. You've got a comment in the release with respect to, you know, prioritizing investment and growth opportunities, specifically the supply chain transformation ahead of returning further capital to shareholders. Outside of that, I haven't seen much else. I acknowledge you've got 2024 CapEx guidance, but I'd just appreciate comments that you could make with respect to the advancement that the company's made on the, you know, I guess, due diligence and potential scope for investment over the next couple of years. I guess quantum and timing would be appreciated. It's been part of the strategy for a while. Sure. No problem. One of we've got incremental expansion at Kyabram milk facility in Victoria, which was mentioned, but the bigger investment is with in relation to NBM in blending and canning laboratory facilities there. That's, depending on the scope of that, that's, you know, NZD 100 million- plus in investment over time, over the next several years as we work towards creating a fully integrated facility there, and one that we can hopefully get registered for China label purposes as well. We're also keeping balance sheet strength as we look for other ways to accelerate our access to China label registrations going forward, primarily in New Zealand, but we are considering other options, and that could include M&A, JV, alliance options. I can't comment specifically on those. If we ever have anything to announce, we'll certainly let the market know immediately. That's why we are keeping the balance sheet strength at the moment. It's not necessarily for in relation to expanding our brand portfolio or front-end related growth-driven acquisitions. It's more to transform our supply chain to enable us to realize the full potential of the a2 brand with more products and developing our own supply chain capability going forward. And, now, when we complete that, that program of work and have more, I guess, transparency and clarity over our future capital needs at that point, along the journey, we'll always continue to review our capital management program, and we'll consider ways to return capital to our shareholders at that point. Yeah, I might just follow up, but I mean, you know, even with a reasonable degree of CapEx over the next couple of years, you could see the cash balance in this business being north of NZD 1 billion quite quickly. Does it just feel to me as though you're gonna be spending NZD 500 million plus unless I've misread, certainly? Well, as I said, that we are considering inorganic options as well, so mergers and acquisitions, joint ventures, alliances, that could, I'm not saying they will, but they could absorb a significant amount of capital. We're preserving the flexibility to do that. The exact path in which we navigate securing access to our China label registrations in the future is not certain, and we're considering a lot of different options at the moment. As that becomes more clearer through the passage of time and the execution of initiatives, then we'll be in a much better position to make more definitive judgments around the capital needs of the business going forward and how to return that to shareholders. We fully acknowledge that we have a significant cash balance in the business. We're not hanging on to that for any other reasons other than we believe that we should deploy that to enhance the, the future value of A2 going forward, primarily focused on supply chain transformation. The next question comes from Sam Teeger from Citi. Please go ahead. Well, good morning, David and team. Well done on the strong results in challenging conditions. Just wanted to check, in terms of the outlook for low single-digit growth in FY 2024, would it be unreasonable to assume earnings decline in the first half given the China label transition? We haven't provided explicit guidance on that, Sam. You know, all we've said is that second half, you know, the sales number is later to the second half, primarily because of the China label transition and also cycling of the, the English label numbers in the first half and the geographic kind that impacted us in the second half. We haven't provided explicit guidance on that. I mean, you can make certain assumptions that could lead you to that. Not necessarily planning for that, but, you know, we'll, we'll, we've given the guidance, we'll see how this first half plays out. There's a lot of uncertainties at the moment. There's a broad range of outcomes. We'll be in a better position to give a little bit more color on that at the, the AGM in November. Got it. What's holding you back from allocating more resources to the U.S. infant formula opportunity now that you have that FDA enforcement discretion? Most of the resources on that, Sam, are focused on achieving the longer term approval, with, with the FDA, which is quite a process, which we can explore that offline, but there's a enormous amount of effort that goes into that. In terms of capitalizing on our enforcement discretion opportunity, we have produced a small amount of stock, and we're trialing certain distribution, which is in the first half of this year, both offline and online, and we'll learn from that as we progress the longer term approval. The reality is that when enforcement discretion was granted to the market by FDA, there was an obvious crisis of supply in the market at that time, and the vast majority of that crisis has dissipated. Now, the market's gone back to more normal conditions, so that, that crisis is over at the moment. I guess we're in that awkward stage between having temporary approval and hopefully long-term approval. So from gaining significant distribution in the market, we'll have to wait till the next round of, of range reviews and resets by our customers in the future. Once we have that permanent approval going forward, we'll be in a much more secure position to engage in longer-term business development. I hope that makes sense, but certainly if there are opportunities in the meantime, we'll test and learn and explore those over time. Thank you. The next question comes from Lisa Deng, from Goldman Sachs. Please go ahead. Hi. First question is on the channel mix shift in China label and what that does to basically product, sorry, profitability. Can you please let us know what the DOL versus MBS sort of profit is like? And then also in the lower-tier cities versus the higher-tier cities as well. Thank you. Lisa, I'll, I'll answer that one. I mean, first of all, it's naturally sensitive, as you would expect. All I can say is that the margins between the channels and the cities are, are, are similar, so that the movement in that channel mix or city mix is not a material impact on the profitability of our business. It's more so between China, China label and English label, which we're exploring before. Okay, got it. In terms of the step-up in A&M, if we just look at the, I think, sort of total A&M dollar for China label into next year, what's the split between above the line and below the line, roughly, please? Well, it depends how you classify that, but. Like, more like, you know, the caravan is in channel activation below the line. Right. Yeah. and celebrity endorsement, above the line. I mean, I guess how we think about it is how, you know, where, where are we targeting and activating through the, the funnel. If I think about the, the lower down the funnel initiatives in, in, you know, offline and online. If you look at the, the mobile caravan is an example of, you know, offline activation, trade activation. If we include that together with, you know, brand ambassadors in store, mama classes and other road shows, et cetera. If we also add to that, the performance-based online e-commerce spend that we do as well, which is targeting the lower end of the funnel as well, all of that accounts for roughly about 60% or more of our investment. That's lower in the funnel. What we have done, the rest is obviously higher up in the funnel in terms of consumer awareness and, you know, through various mechanisms that we, that we, that we market, but we've dialed that up a lot over time. Our consumer marketing, particularly, digital marketing, through social channels as well, we've really increased that over time as well. The guide for an increase into FY 2024, is that mainly the towards the end of channel, sorry, the funnel or towards the top end of the funnel that you talked to? It's both, but as you would expect, we've got a- Yeah ... really significant consumer campaign, schedule planned for the first half and leading into, the second half as well around our new China label relaunch. There's a whole... It's a bit sensitive at the moment because, you know, we've got certain events planned for the launch. Yeah. Yeah, there's a big, there's a big sort of consumer program in our plans for the first half. When you think, if you, if you reflect on our guidance, I just, I'll bring you back to that because we're guiding to low single digit revenue growth. In terms of brand investment, we're saying that we intend to increase brand investment, which is entirely consistent with our strategy, but we've also said in line with sales. At this stage, we're not guiding to a substantial increase in brand investment. We, we'll manage that as best we can to follow sales. We'll, we'll think about the allocation of that towards our China label, like what we did when we launched our a2 Platinum refresh last year. We prioritized spend towards that as well, and coming into this year, we'll prioritize supporting our China label transition. Sounds for the first half weighted as well? In terms of investment? Well, it's, it might be more balanced than you think, because the program, if you think about it, we're not saying exactly when we're, we're transitioning, but given that manufacturing didn't start until the end of the, the fiscal year, then you would expect that transition to be later in the first half. The marketing campaign will go, you know, in the second quarter, but into the first quarter of next year as well. It might be more balanced than you might think it will be. Okay. Thank you. The next question comes from Adrian Allbon from Jarden. Please go ahead. Good afternoon, team. Just, first question, just on your, on your FY 2024 guidance of low single-digit top line, just within Infant, are you expecting any volume gain within that or is that all price/mix? There, there may be volume gains within that, Adrian. If you think about our guidance, we've, we've also got, you know, MVM through GD2 pricing coming down, plus in generalization as well. You might want to think about the impact of that and therefore what that means for the low single digit guidance in respect to the, the rest of the, the business. We are planning for China label to grow and to outperform English label. Specifically on the guidance on Infant, we're not providing, you know, specific numbers on that. Okay. Then just like, just related then, I guess, like if I look at some of the introductions of these new GBs on the China labels side of the business, like most seem to be coming with a reduction in the pack size, like, you know, and, and various kind of, you know, some are 800, some are even all the way down to 700. Like, can you allude to any, can you sort of give us some, a sense of what a2 is planning on doing on that front? So, yeah- Anything? The bit, yeah, yeah, it's a bit. You would imagine that we would consider pricing and pack size, in connection with the new product coming to market. If you look closely in the deck, you'll see that we've photoshopped out the size of the of the package. It's commercially sensitive at the moment. Like, we'll. That'll be obvious in the next, you know, in the next few months when the product is in market. Apologies, I'd like to be able to let you know that, but it's, it's sensitive in the market. Okay. All right. Just, well, I guess the other question, like in the, in the pack, you talk about this, this new English label range. Like, I, I imagine a lot of this is commercially sensitive as well, but can you give us an indication what you'd be sort of what, what are the characteristics you're targeting with that second range on the English label side? ... sorry, I'm not trying to avoid your question, Adrian Allbon, but anything to do with innovation and, you know, product positioning and all that, like, it's, it's very sensitive in the market. Again, that'll be obvious, you know, when we launch the project, product later in FY 2024. I'm not, I'm not gonna say whether that, you know, what, what's the unique selling point to that, where it's a position in the market. Is it, is it higher or lower than a2 Platinum? You know, what's the formulation, et cetera. Like, it's all very sensitive in the market. Apologies. We can talk about that more, hopefully, the full-year results next year. Okay. Like, I guess related to that then, like, would that in your, on your FY 2026 slide, which is 14, how you've got English label IMF at orange, would that be? Can you, what would be the sort of work steps to turn that to green? Would that be one of them? Oh, an English label in terms of our goals and scorecard around that? That's what you're referring to. Yeah, just like that. Yeah, I think, I mean, obviously, the China label is green, the English, English label's orange. Yeah. I understand that obviously the Daigou has been much tougher than you expected. What do we need to sort of see to turn that to green? Well, if we think back to when we did our October strategy update, we had, you know, off the FY 2021 base, in, in gross terms, prior to the risk adjustment, we had NZD 400 million growth in China label, NZD 300 million in English label. We are ahead of plan on China label, we are behind plan on English label. What we have done and what we will do is that we have significantly changed our distribution model, we've moved significantly from a dependence on the Daigou channel, to the more controlled channels in CBEC and O2O. We have changed our distributor base as well, and we have, you know, much more transparent performance-based partnerships in place. We feel very good about our distribution model in English label. The Platinum refresh has worked well. It's been a very successful initiative, relative to what otherwise may have been if we hadn't refreshed the range. What we're now focused on is innovation within English label and expanding the portfolio for us to capture more opportunities in the market going forward. It's also, you know, this is on the backdrop of the English label channel, you know, suffering significant contraction overall. You know, pleasingly, I think we're starting to see the English label channel stabilize at around 15%. It was actually, you know, very similar during the period to the China label declines as well. I think we've got the right foundations there, and, and hopefully we may see some recovery in the Daigou, but we're not necessarily planning for that at the moment. I think it's really going to be with the distribution in place and gonna fuel the growth through innovation. Okay. Okay, thank you. Thank you. At this time, we're showing no further questions. I'll hand the conference back to David Bortolussi for any closing remarks. Thanks very much for joining the call. Our analyst community investors, we look forward to catching up with you and the rest of the roadshow during the course of this, this week and early into next week. Some of the other analysts will drop some workshops this afternoon. We can explore different topics. Anyway, look forward to catching up shortly. Cheers! Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.