Good morning, everyone, and welcome to Synlait Milk Limited's half-year results conference call. I'm Hannah Lynch, the head of Strategy and Corporate Affairs here at Synlait. I'll shortly hand over to our CEO, Grant Watson, and our CFO, Rob Stowell, who will provide you with an overview of today's presentation for our results. We'll then open the phone lines for question and answers. I ask, as always, that when we reach the Q&A portion of today's presentation, that you keep your questions to two per person. If you have any follow-ups after the call, please feel free to reach out to me directly. Over to you, Grant. [Foreign language], and good morning to you all. Thank you for joining us on Synlait's half-year 2024 results call. It's been a challenging half year for Synlait as we continue to reset the company to better achieve our strategic, strategic objectives, while working to finalize a clear plan to materially reduce our debt. After significant levels of investment over a number of years, Synlait has too much capacity and too much debt. Interest rates have roughly doubled in recent years, and birth rates have roughly halved in our largest infant formula market, China. Today, we will explain our clear plans to utilize and/or reduce capacity to materially reduce debt. In terms of our financial results, the half year to 31 January 2024, Synlait reported an adjusted EBITDA of NZD 36.1 million, total EBITDA of NZD 19.9 million non-adjusted, and an adjusted net loss after tax of NZD 17.4 million, in line with previous guidance on an adjusted basis. The total net loss after tax, NZD 96.2 million. Net debt sits at NZD 559 million. These results are extremely disappointing for a range of reasons that we will cover off during the call. Our turnaround activities are broken into three pillars. First pillar: leveraging our balance sheet. We have too much debt. Our second pillar: filling our plants or reducing our manufacturing capacity. We have too much capacity. Our third pillar: improving our profitability across pricing, product mix, operational costs, and SG&A. Combination of these three pillars will ensure we return Synlait to a position of sustainable, profitable growth. Today, we announce confirmation of amendments to our banking facilities, a strategic review of our North Island assets, a letter of support from our largest shareholder, Bright Dairy, an increase to our base milk price forecast from NZD 7.50-NZD 7.80, and in doing so, reinforce our commitment to paying a market-competitive milk price. We are very thankful that our largest shareholder and our banking syndicate remain supportive of our strategy, which is first and foremost focused on our advanced nutrition and food service businesses. These are areas where Synlait has a clear competitive advantage, and can deliver diversified, high-value growth. To enable our strategy, we have world-class manufacturing assets that are highly flexible and scalable, which ensures we are well-positioned ahead of emerging customer demand trends, especially in areas such as early life and adult nutrition. All of this has proven to be a competitive differentiator in our negotiations with our customers, both existing and new. We have several trials in place with new customers of scale, with several new products in development. When you combine this with a refreshed leadership team and board, we have all of the pieces to execute against our strategy and return to profitability. Moving to slide two. The three takeaways from today are: takeaway number one, we have a clear deleveraging plan set by our banks and largest shareholder, which includes a strategic review of our North Island assets alongside our ongoing work to sell Dairyworks. Takeaway two, we have an aggressive forward-looking business recovery plan, which is working across the Synlait business to accelerate volume growth, reduce costs, and increase the utilization of our assets. Takeaway three, our strengthened leadership and governance, led by a restructure of our executive leadership team earlier this year, and the recent appointment of George Adams as an independent director, positions us well for stronger execution. We acknowledge that there are a number of material uncertainties we need to navigate our way through during the next three to 12 months. Please refer to note two in the financial statements for more information. We need to deleverage Synlait, address our excess capacity, and get back to focusing on what we do best: sourcing, developing, and producing innovative, nutritional, and food service products for the world's best food companies, whether that's Nestlé, Danone, Savencia, or The a2 Milk Company. Turning to slide three. We have a clear plan in place to deleverage. We have today announced a strategic review of our North Island assets in Auckland and Waikato that will canvas several options to realize their value more fully, whether that's by potentially divesting those assets in whole or in part.... To be clear, we do not go into the strategic review with any preconceived outcomes in mind, other than to maximize profitability and shareholder value in the long term. These are world-class facilities with unique capabilities, such as plant-based and dairy. As we have discussed with many of you previously, we have, at various points, considered a capital raise. We have not taken this option off the table. We also want to note that the Dairyworks sale process remains ongoing. This is a high-value business. Like the North Island strategic review, the board wants to ensure the best possible return for shareholders should this business be sold. As I've indicated in my opening comments, our banking syndicate has provided us with the relevant amendments to our banking facilities. Our cornerstone shareholder, Bright Dairy, has provided a formal letter of support, made additional loan facilities available to us if we need it, and provided commitment to support an equity raise if this is required, all of which provide Synlait with additional confidence and stability in the near term. Moving to slide four. I want to quickly highlight why a North Island strategic review was needed. If revenue and volumes are approximately, you can see that Dunsandel is a strong profit center, the North Island assets are loss-making. Stronger contribution from Synlait's North Island assets is needed by filling capacity with new customers and/or increasing volume from existing customers, or by divesting assets partially or fully. Moving to slide five. In terms of key financial metrics, half year adjusted net profit after tax is a loss of NZD 17.4 million, in line with guidance on an adjusted basis. Total group revenue is NZD 793.5 million, up 3% on prior period. As mentioned, the adjusted underlying total group NPAT is a loss of NZD 17.4 million, and NZD 31.7 million down on prior period. Total group NPAT is 96.2 million loss, NZD 101 million on prior period. Adjusted underlying total group EBITDA is NZD 36.1 million, down NZD 26.4 million on prior period. Total group EBITDA is NZD 19.9 million, down NZD 31.6 million on prior period. We are pleased to announce an increase in our forecast farmgate milk price for the season to NZD 7.80, and on this basis, we are forecasting our average total milk price to be NZD 8.09, NZD 0.29 above the market-based milk price. Operating cash flow was a negative NZD 98.1 million. This is an improvement on the prior period of NZD 26.5 million. We improved capital expenditure by 48%, and this sits at NZD 17.5 million for the first half. Net debt, NZD 559 million. Total gross profit is NZD 43.6 million, down 47% on prior period. Now, I'd like to hand over to Rob Stowell, our CFO, to take you through financial performance. Morning, everyone. Look, thanks, Grant. Look, it's been a very challenging six months for the business. The results extremely disappointing for management and the board. I'll dig into some of the detail within the results. The first slide I wanna go to is really explaining some of the significant and non-cash adjustments that have been made to the result, which kind of takes us from the NZD 96 million loss through to the NZD 17 million adjusted. These items, some of them are taxable and some of them aren't, so I'll try to explain it on a non-tax basis. So the first adjustment is an impairment of NZD 50.3 million before tax. This relates to the underutilization of our North Island assets, specifically the Pōkeno site, where we have our dryer, and also the Richard Pearse site, where we have our canning line. We've invested significant sums in these facilities over the last five years, and the assets need higher volumes to retain their valuations on the balance sheet. Second is a NZD 31.1 million write-down of net assets value of the Dairyworks business. Due to Synlait holding this asset is held for sale, we are mandated under the accounting standards to value this asset at our best estimate of fair value, less disposal costs. The way we've done this is we've valued it at our latest non-binding indicative offers received. Essentially, the net assets of the business are sitting around NZD 150 million, and we're valuing the business at around about NZD 120 million, roughly. The third item is for the product costing method change. This is NZD 11.6 million before tax, or NZD 8.4 million after tax. And this occurs to, some improvements that the finance team have made in our methodology of, costing products. This will change, this change will allow us to do a much better job of understanding the site and product profitability across the business. We had agreed to treat this, as an accounting policy change, which would have had minimal impact on the current year. The late change by our auditors, after consulting with their global technical departments, has us putting through this change as an estimate, which has a non-cash change to this financial year. So the adjusted NPAT loss of NZD 17.4 million, detailed on page eight, the next slide, includes the above, plus a small number of minor adjustments outlined. We move to the next slide. This slide unpacks some of the key components of the result on an adjusted basis. And if you can cast your eyes across to the adjusted NPAT movement bridge on the right-hand side, it tracks what has changed from our adjusted NPAT of NZD 14.3 million profit for half year 2023, to an adjusted NPAT loss of NZD 17.4 million for half year 2024. Both half year 2023 and half year 2024 has been adjusted for the product costing change just mentioned. So to quickly summarize, Ingredients business delivered NZD 20.8 million margin loss versus half year 2023. With the volume impacts that were positive by 60%. Noting last year, we had issues with our ERP system upgrade. This had a small positive impact of NZD 5.7 million. Negative impacts on margin, and there's a number of them, offset this volume upside. Firstly, the product mix. This is to do with our skim milk powder, whole milk powder lead. We had very good returns last year, and hence this year, while we've got returns, they're not - they're, they're outweighed by the fact that last year was so good. We've also seen the strength of butter prices improve quite dramatically, and we don't have this in our product mix. We don't sell butter. We've also seen higher level of product discounting within the segment and a large FX impact as well. That all adds up to around NZD 26.5 million downside on Ingredients. This one is Advanced Nutrition, so this has delivered NZD 11 million margin loss change versus half year 2023. The negative impact mainly comes from volume, so it comes from roughly 1,600 metric tons less infant formula volume, and also sales of about four tons less lactoferrin than last year, compared to last year. It's around NZD 9.4 million, and the other piece is really a softening in prices, so and within the lactoferrin area and also a little bit of FX. Consumer Foods business delivered NZD 0.8 million margin loss compared to HY 2023. Look, these businesses, this includes basically Dairyworks and the fresh milk and cream business. These businesses did pretty well last year, and it's good to see some consistency kind of come through, also this half. And was up 2,305 metric tons, and this was mainly due to Dairyworks building market share and a small uptick on the fresh milk and cream business as well. Margins were slightly down due to the softening of retail prices, the fresh milk business, due to the pricing model. The other big down bar is sitting within our financing costs. A large increase in financing costs of NZD 13 million, due to interest rates being very high through our first half, and obviously higher average debt balances is impacting there as well, despite the Ingredients business having less inventory. The number of slides following this one, which go into a little bit more detail, so I'll just touch on them. So firstly, Ingredients. So this, the margin on Ingredients was NZD 1.4 million for the half, compared to NZD 22.2 million last half. Key thing to note on this slide is the dramatic reduction in inventory on hand and the increase in production achieved in half year 2024. The reduction in inventory and Ingredients has helped reduce our debt balances. If we move to the next slide, Advanced Nutrition. This area delivered a margin of NZD 32.7 million. It was down from NZD 43.8 million the last half. Key thing to note is the increase in base powder on hand half year, and this is due to change in approach across the two years. Firstly, last year, you might remember we were building, we were running down base powders to allow for the new China formulations for the a2 Milk Company for the new SAMR registration. So that was the key reason we've got a difference in base powder. Move to the next slide, Consumer Foods. This area delivered NZD 16.5 million margin to NZD 17.2 million on the last half, so pretty consistent. It's good to see the Dairyworks business continue to perform as we continue to hold this business up for sale. They're set for a strong second half after doing capital works to improve their efficiencies around the Christmas period. The next slide is food service. So this is basically a UHT whipping cream business into China, and this delivered a margin of NZD 100,000 versus a loss of NZD 100,000 last year. So it's a new business. Sales have grown from NZD 1.1 million last half to NZD 9 million this half. The business unit was impacted by a number of startup costs, but we see this area kind of improving as volume goes up over the next six to 12 months. Next slide is the SG&A and manufacturing cost slide. It's pleasing to see the results of our cost out program reduce SG&A costs by NZD 5 million, 7.8%. Last year, we had our ERP system challenges. However, this year, we have again incurred costs in relation to customer contract disputes, de-leveraging of the balance sheet and getting ourselves organized around asset sales and equity and debt options, and also implementing new warehousing in the North Island to assist with the new multinational customer up there. However, within in manufacturing costs, it's been a more difficult problem to tame. These costs rose NZD 13.7 million or 9%, and the key backdrop here was our strategic objective to increase the production in our North Island operations. Costs had to be put in ahead of volumes, which were slower to materialize, due mainly to market entry issues. The areas where we saw costs increase were around milk supply costs. This was due to the incentives, but also higher transport costs and inflation generally. Energy costs are also up due to higher prices and clean energy initiatives. Depreciation was up due to the North Island plant upgrades and the depreciation of those coming through. Employee and contractor costs were up due to modest wage inflation and the ramp-up of our North Island sites. Dairy costs were up NZD 3.2 million, due to the ramp-up of sales and production volumes into new markets. However, these costs are more than offset by the higher margins within that business. If we, if we move to the next slide on cash flows and, and net debt. Net debt ended, as Graeme mentioned, at NZD 559 million. This was up from NZD 519 million at the same point last year, an increase of roughly NZD 40 million. This is always at a peak at this point in the year, due to the seasonality of the business. Lower profitability and higher financing costs are also contributing to the higher debt level. Key points to denote on this slide is that our operating cash flows actually improved by NZD 26.6 million compared to last year. This is mainly due to the fact that we didn't have the ERP issues affecting volumes like they did last year. Capital expenditure is tracking down, and with all major projects now complete, came in at 49% within the previous year at NZD 17 million. We're not providing guidance on debt ratios at this point, due to the uncertainty around the de-leveraging items, both in timing, amount, and potentially, EBITDA changes, where the goal remains to get our debt ratios down between 2x and 2.5x debt to EBITDA as soon as possible. Turning to the last slide on banking facilities and banking covenants. Our expanded banking syndicate now includes 5 banks and has continued to be hugely supportive over the last six months. I'd like to take this opportunity to thank the banks publicly for their unwavering support. It's obviously been a challenging period, where we have, despite coming very close, failed to receive the binding offer on the Dairyworks business. Board of management have extremely strong desire to reduce debt and associated high servicing costs that go with it. As mentioned earlier in the presentation, we have several parallel work streams to achieve this in the next three or four months that center around both equity raising and asset sales. We expect the level we need to de-leverage is by roughly NZD 300 million to enable us to refinance both our senior bank debt and the bond maturity in December, where in the meantime, we need space and have negotiated an extension of the NZD 130 million repayment on to the 15th of July, and have also completed amendments to several of our key bank covenants. Getting Bright Dairy providing binding support through this time has also been critical to allow us time to execute in this tough M&A environment. I would also like to thank Bright Dairy Group for their binding letter of support. Back over to you, Grant. Thanks, Rob. I'll now take you through a business update. We move firstly to Advanced Nutrition. In terms of leadership, new Chief Revenue Officer role has been established. Nathan Gair, previously the director of Advanced Nutrition, has been appointed to this role. Chief Revenue Officer role will reduce complexity through a single point of customer contact across the Advanced Nutrition and Ingredients business units. With the business development, vegan non-dairy hybrid nutrition products are now being exported to a range of Asia Pacific markets in various can and flexible packaging formats. Trials and audits are underway to produce formula-based powders for Southeast Asian markets, following the signing of a memorandum of understanding with a new prospective customer. Strategic priorities for advanced nutrition are to deliver compelling value to our two cornerstone strategic customers, but really life and adult nutrition business in China and Southeast Asia, diversify specialty ingredients plus categories and customers. Moving on to food service. With development, we have grown our sales volumes, delivering against growth expectations. The partnership with Sinodis has achieved strong market recognition in China. Global food company, Uhrenholt, confirmed the first UHT cream order for April 2024 production through its Emborg brand. Uhrenholt launches into Southeast Asia, May 2024. Innovation pipeline is underway to bring the second generation of Joyhana cream to market, December 2024. Strategic priorities to food service are: grow market share and distribution in China and Southeast Asia, expand innovation pipeline, and this includes beverage, cream, and other functional creams. Category expansion as appropriate, involving partnering, a partnering approach, in the medium to long term. Into Ingredients. From a business development perspective, we have a new five-year investment partnership with Nestlé, announced through our Lead With Pride program, to support Synlait farmer suppliers and on-farm sustainability. We have increased the number of high-margin, multi-contract and multinational customers. Strategic priorities for Ingredients are: optimizing product mix, delivering premiums above GDT, appropriate sales phasing, growing our value-added portfolio, reducing operational complexity, and continuing to optimize our cost base, and commercializing Synlait's strong sustainability credentials. Moving on to Consumer, which is primarily Dairyworks. Dairyworks, EBITDA performance continues to track positively towards budget expectations. This will be materially higher in FY 2023. Capital improvements. Capital improvements have been made to enable greater labor efficiencies, safety improvements, and product quality. Rolling Meadow brand positioning and visual identity has been refreshed for the first time in 15 years. Southeast Asia and Australia continue to be the significant growth engines for Dairyworks. Moving on to On-Farm Excellence and Sustainability. Retention of our high-quality milk supply remains a critical priority. The balance sheet has come under continued pressure. Cessation notices from farmer suppliers have increased compared to previous years. Cessation notice period is two years, which means Synlait, Synlait's current financial performance not impacted. Confident, given the progression of the reset plan, there is currently limited material risk to future financial performance. Strong competitive farmer supplier offerings remains in place. We have also made a number of enhancements to our Lead With Pride program. Synlait achieved B Corp recertification, Global Gold Standard Accreditation, Sustainability. Moving on to our forward-looking business recovery plan. Our plan is well progressed. I mentioned, this is broken into three pillars. First pillar is deleveraging and cash flow improvements. We are targeting net debt to be below NZD 200 million by the end of FY 2025. Total debt reduction target for us is circa NZD 300 million. The second pillar, accelerating volume growth. We're targeting over 20,000 metric tons of volume growth in Synlait value-add products by the end of FY 2026. The third pillar is optimizing performance. We're targeting an EBITDA improvement from both volume and performance initiatives, NZD 45 million per annum by the end of FY 2026. Specifically, the first pillar, deleveraging and cash flow improvements. We have a clear deleveraging plan in place, and we are focusing on further working capital, CapEx improvements. Moving on to the next slide, pillar two: accelerating volume growth. This is broken into growing advanced nutrition volumes, and we're speaking here specifically to early life and adult nutrition in China and Southeast Asia. Second part is growing food service volumes, China, Southeast Asia, and also exploring the Middle East. The third part is accelerating growth in China, leveraging our strong and committed partnership with Bright Dairy in China, accelerating volume and value growth opportunities, advanced nutrition, food service, ingredients. We are underweighted in this highly profitable market. The third pillar, specifically around optimizing performance, is around improving manufacturing performance, improving quality performance, optimizing our supply chain, and executing our cost reduction initiatives. Moving on to strengthened leadership structure. The search for a new independent director is complete with the appointment of George Adams to the board in March 2024. In terms of our executive leadership team, which reports to myself, is reduced by three, and this will increase business unit alignment, accelerate growth, reduce costs. Naara, as mentioned, now has advanced nutrition, ingredients, along with a number of other customer supporting functions. Paul Mallard now takes ownership for the end-to-end supply chain, planning, manufacturing, quality and supply chain. Charles Fergie takes on the additional responsibilities of corporate affairs and strategy. It is worth noting that Tim Carter still reports through to me as the CEO of Dairyworks, until such time as this business is sold. Now I hand you back to Rob Stowell to take you through full year 2024 guidance statement. Grant, look, our guidance statement, previously, pointed to towards an EBITDA of NZD 90 million, flat or down. Synlait now expects our FY 2024 EBITDA result to be significantly down. We're putting out a range of between NZD 45 million and NZD 60 million, excluding any non-cash adjustments, for product costing, method. That change will grow through to the end of the year to roughly NZD 17 million, but that's an estimate at this stage. Look, the key areas that we're seeing being impacted is, softening demand, and also, margins right across all the business units. We're also seeing adverse foreign exchange affecting our results and also ongoing product mix, headwinds. And the final bullet point there, and we've given some examples, is operating expenses continue to be challenging, legal costs, a number of costs coming through on our inventory management and other costs. So look, as noted throughout our materials and, and financial statements, you know, we do face material uncertainties around the timing and amounts of the deleveraging options. They're all currently progressing. We would hope to keep you updated on how that is progressing over the next couple of months. And look, final point there is, you know, the board and management remain fully committed to the deleveraging. That's number one priority, and we'll continue to focus on improving the profitability for the balance of 2024. The final slide before we open up to questions. Here's what you can expect from Synlait in the second half of FY 2024. We will deleverage our balance sheet and improve cash flow. We will accelerate volume growth, if necessary, reduce capacity. We'll optimize our operation, operational and trading performance across manufacturing, quality, supply chain, and our cost base more generally. Now I hand back to Hannah Lynch. Thanks, Grant and Rob. We'll now hand through to Ashley at Chorus Call to start the Q&A process for us. Reminder, if you could just keep your questions to two per person, I'm happy to take follow-ups with the team, as always, later today. Ashley, over to you. Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from Matt Montgomerie with Forsyth Barr. Please go ahead. Hi, guys. Good morning. I might just start with your outlook commentary. I'd just be keen to understand, I guess, what's changed in the last six weeks or so, so dramatically. I mean, if I look at the factors you've called out in terms of margins and costs, it's, you know, consistent with what was articulated in February. So I'd just be keen to understand, you know, within each segment, with some detail, what's driven the big step change? Matt, so I'll try and give, give a little bit more color to what, what's going on. First of all, I'll touch on the advanced nutritional kind of segment. What we're seeing within there is impacts across lactoferrin. So, we've got uncertainty around the market has really softened uncertainty around volume and, and also prices. As you know, the lactoferrin segment has been quite profitable for us in the past, and we are seeing some volatility in that space. The other factor hitting that and also the other segments is foreign exchange. So, Fonterra released a FX assessment in late January early February, which basically kind of crystallized the fact that actually we were behind on foreign exchange. We'd had a number of tailwinds in foreign exchange the previous two years, but we're actually behind, and that's affecting the ingredients business recently, significantly, and also in other segments as well. Some of the other information that's come through over the last six weeks is really around inventory and discounting of inventory. And so we've still got a number of issues, particularly within our logistics and our warehousing, around inventory and products that are not valued at what we think they're valued at, and so we're working our way through that at the moment. Then, I guess the overlay is still not quite knowing exactly how we're gonna go across the next few months around expenses, costs, supply chain disruption through the Red Sea, shipping kinda play there. So they are the other things we're concerned about. Look, I would hope that, you know, that range is a conservative range, and that we'll be targeting to be towards the upper end of that range. And just within the advanced nutritionals business, I think prior commentary was volumes to be up 11%-12% in FY 2024. Yeah, what would that number be now? Presumably, it's lower. And I guess, where's the, where's the differential coming from? Is it, you know, the EBIT volume slower, or is it a2 moving volumes away from your facilities quicker than expected, or in demand from them? Look, this is commercially sensitive information, but I'll try and give you a little bit of color here. Look, we're actually expecting our infant formula volumes to be a little bit better than what we anticipated previously, Matt, and our volumes produced up in our Pōkeno site to be a little bit down on what we initially you know were projecting you know six months ago. So net-net, no change? Fair to say net-net would be down, on what we were originally anticipating six months ago. Overall. Thank you. Your next question comes from Nick Maher with Macquarie. Please go ahead. Morning, guys. Just, in terms of the strategy from here, it sounds like you're gonna be sort of a single site, kind of one customer business really again. Is that something that you guys are sort of able to sort of manage the risks appropriately of going forward? Sort of what Synlait's been sort of working to get away from for the last five years. Yeah, Nick, clearly, we haven't made any decisions on the complete sale of North Island assets or potentially selling half of that asset base, and there's still a possibility that we might retain those assets. Regardless, it doesn't take us away from our focus on advanced nutrition and food service. Food service creams come out of the Dunsandel site, and any future category growth, food service would also come most likely out of the Dunsandel site. Clearly on the Dunsandel site, we've got capability for the a2 Milk Company business, for other customers that we're in the process of acquiring, and there are other potential opportunities that we could develop in the Dunsandel site in any event we did exit our North Island position. Strategy focus around advanced nutrition, infant and adult remains, and focus on food service remains. That's helpful. Then in terms of some of the longer-term goals you put out in the last sort of year or two, are those parked now? Are they sort of unachievable in terms of the sort of 15% return on capital target? Just some sort of flavor around that and how much of, I guess, the challenges are still, you know, in your view, kind of short-term, kind of one-off things versus, you know, rebasing the returns for this business? Yeah, Nick, it's Rob here. Look, obviously, we're going through this strategic review in the North Island, so there's a fair few moving parts, and obviously, you know, the Dairyworks process is still in play. In saying that, I mean, I think it's something that sees the function of both profitability and assets. And so I think we would continue to revisit it. We've still got ambitions to be a high-returning business in the future, but I think it'll become clearer over the next three to six months on exactly what that return in the long term looks like. Okay, thanks, guys. The next question comes from Marcus Curley with UBS. Please go ahead. Good morning, gents. Could we just extend on the asset sale program? So, yeah, could you just give a little bit more of an update in terms of where Dairyworks sits? So you've had indicative offers at NZD 120, you're still working on those, or are those offers gone and you're restarting? Yeah, look, we, we have had a lot of. We've had some, a lot of offers, non-binding, but we also-- we came very close last week to getting a binding offer. I can't say who the party was, but that it did not occur, and it wasn't because of the business, and it was a very much a party that really liked the business, but for regulatory reasons, it just wasn't the right time for them to bite down on it. So I think going forward, we, it-- that was a setback, but we've still got at least two parties who are interested, and we continue to work with them over the next couple of months to see if we can build them into a credible offer. Okay. And then the other option clearly is in North Island. Could you give a little bit of color about the value there? So you, you've written down Pōkeno. To what level? I can't see anything in the accounts that sort of stipulate the North Island values. Look, yeah, I don't wanna give away too much information here, but essentially, you know, it depends what assets you include in the North Island. But if you include, you know, Pōkeno up there, we've basically got Pōkeno, and we've got the Richard Pearse Drive canning line, and we do have associated warehousing for those assets under lease. Those assets, the net book value of those assets are low NZD 400 million. The impairment, which is kinda an accounting treatment, goes across all our Synlait Milk assets, including the North Island site. So no, I wouldn't see much reference from that. Obviously, we need to go through a process over the next couple of months around really exploring the strategic value of those assets in the North Island. And at the moment, is it fair enough to say, yeah, that the Pōkeno and related assets are EBITDA loss-making? Yeah, correct. Okay. And depending on how you account it, you know, the blending and canning would be relatively profitable? Look, we've got capacity in the South Island for blending and canning still, so we've got headroom and capacity down here. And obviously we have a lot of headroom up in the North Island. There's only small volumes going through the North Island canning line. All right. Okay. So, yeah, there's not a lot of revenue or EBITDA with the North Island blending, canning, so that would... The value there would depend on the acquirer bringing their volumes into it. I think it's the way to think about it is essentially if you can increase the nutritional volumes through the Pōkeno site, we've got a sacheted line at that site as well, and then we've got canning at Richard Pearse Drive, then those all those assets start to work together. But you need to increase those that baseload of nutritional volumes and then within Pōkeno first. Okay. And then, sorry, that was the long-winded first question. Second question was, you mentioned in the strategic component, an uplift in EBITDA of NZD 45 million, and by end of 2026. Yeah, what base is that using? Is that using the new revised guidance for 2024? Yeah. No, no, correct. It's, it's using FY 2024 as a base. Those targets basically include, it's, it's mainly driven by value. But also there's other stuff I've talked about a lot in the past around the kind of leakage in the business where we've got, ... improvements around costs and yields and inventory management, all those sorts of initiatives, have been worked into those numbers as well. Marcus, it's worth mentioning that the North Island asset base has high fixed costs attached to it, so a high contribution margin as volume flows through those assets, it improves the profitability in a reasonably rapid fashion. And then sorry, just extending on that, so what assumption, if any, have you made around a2 volumes? Obviously, they've announced, you know, that they're planning on moving the stage four away. Outside of that, is there anything else assumed within the 45 for them? Where we have certainty around their forecast, then we've allowed for that. Where we have uncertainty around future volume, for example, dependent on the outcomes of, say, arbitration, we've taken a risk-weighted view, and we can't specifically talk to that at this point. Okay. But broadly speaking, it assumes that, you know, their China label and their English label stage one through to three broadly remains in the business? Yeah, well, I mean, the simple way of looking at it, for the time being is that we hold the same license for the a2 product. Depending on the outcome of arbitration, it may or may not impact English label volumes. So again, we've taken a risk-weighted view of that. Okay. All right, thank you. The next question comes from Sean Xu with CLSA. Please go ahead. Morning, team. Thank you for taking my question. My first one is around the capital raise. So it's great to see the support from your largest shareholder and its commitment to a potential capital raise and a bridging loan, if needed. Given we haven't heard anything from a2 Milk, being seen as second-largest shareholder on these, does that mean you haven't got support from your second-largest shareholder on the capital raise? I know it's probably a difficult question to answer, but any information you can share on this will be helpful. Thank you. We haven't directly engaged with the a2 Milk Company on a capital raise. If we get to the position where a capital raise is concerned, clearly we would engage with our second-largest shareholder and largest customer on that point. But at this stage, we have not engaged with them. No problem. Thank you. My second question is around the interest costs double in the first half compared with PCP. How can we think about the full year interest expenses in the context of this NZD 130 million debt extension, also potential intercompany bridging loan from Bright? Assuming that bridging loan will be charged at the market rate, if that's correct. Yeah, look, it's a good question. I think, obviously we're expecting, funds to come into the business in, you know, February and March, and that's kind of been pushed out, for a period of time, but it really is, you know, more likely that, any deleveraging funds that come in will be, you know, closer to, to July, for instance, as opposed to around April. So interest costs will continue to, increase on our original forecasts. Any, any kind of loan, that comes through from a related party, such as Bright, will have to be at market value. Cool. Thank you. Thanks, team. Once again, if you wish to ask a question, please press star one on your telephone. Your next question comes from Stephen Ridgewell with Craigs Investment Partners. Please go ahead. Yes, good morning. Just picking up on Bright Dairy's letter of support for an equity raising. Are you able to elaborate a little bit more on the extent of the commitment they've provided to Synlait? I mean, have they committed only to take up their rights on a pro rata basis in the event of an equity raising? Is there scope for them to take up more than a pro rata, please? Look, it's very, very premature, Stephen. At this stage, they've committed to participating in an equity raise if we went down that track. Whether they would want to increase their position through that process or normal trading at the market, that is a question for them, and it's certainly, you know, well premature given that we haven't decided on a capital raise at this point. Okay. I guess, but at the least, have they committed to pro rata taking up their right to pro rata in an equity raising? So I don't think that's premature, given that's obviously been tabled as a so, you know, a consideration for the company in the next few months. That is correct, Stephen. ... Okay, thank you. Second question also on the recapitalization plan. There's a comment in, I think it was note two, that, you know, plan B is to, you know, issue the preferred equity for NZD 100 million-NZD 150 million, and then consider the investment of the other North Island assets, including Pōkeno. Could we just be a little bit clearer about what plan A is? Because, you know, Grant, I think you've alluded to on the call, the company's plan is to deleverage by NZD 300 million. You know, you obviously got a carrying value of NZD 120 million for Dairyworks, but there is still another NZD 180 million. So if you're not selling Pōkeno, if you're not issuing the NZD 120 million and NZD 50 million of preferred equity, what, how... You know, is the extra NZD 180 million from an equity raise? I'm just curious as to how you'd delever by that amount, you know, with plan A? Yeah. So, the three big buckets here, Stephen, one is to potentially sell part or all of our North Island assets. Secondly, to sell Dairyworks, and thirdly is an equity raise. Okay. All right. So plan A would probably include some asset sales. Okay, no, that makes sense. And then if I may ask just one more, this one for you, Rob, just the NZD 17 million adjustment, and sorry if I missed this before, but you know, can you just give us a little more comfort that it's a genuinely non-cash item, the new interpretation from your auditors? Is it just an inter-period accrual adjustment, or is it genuinely a non-cash, you know, one-off kind of factor to consider? Yeah, I mean, basically, it's no extra cash is going out of the business. All we're doing is we're allocating our manufacturing overheads more to the ingredients business and less to the advanced nutritional business. And so what creates the adjustment period and period is the fact that we hold reasonable levels of inventory of nutritional products at each year-end, so all the base powder that we need for the next season. So that's, yeah, moves around the numbers. So it's just a way of allocating our manufacturing costs into product costs, essentially, which is throwing around the numbers. Okay, cool. We might discuss this more offline, but appreciate the answers. Thank you. Your next question comes from Marcus Curley with UBS. Please go ahead. Sorry, just a follow-up. When you mentioned that first bucket around the potential North Island asset sales, is that one group of assets you're looking to market, or are you looking to market them separately, as well as together? Our initial thinking, Marcus, is that it's a group of assets in the North Island. There may be interest, as we get into the strategic review for them to be viewed separately. I think that's unlikely. I suspect they would be viewed together. Okay. And is there a logical type of buyer, you know, or investor, you know, for that collective group of assets? Is it. You know, do you see it as somebody who already operates dairy in New Zealand, or, how do you think about the appetite there? Yeah, look, I think given the very high quality of assets, particularly at the Pōkeno site, it's likely to be a buyer that has an interest in advanced nutrition, and potentially an investor that has an interest in both plant-based and dairy, given the segregation we've got on that site, with the two wet mix operations that exist. Look, I think it would be unlikely, you know, in the event we sold it, for it to be picked up by a pure commodity player. Again, the whole point of it getting into a strategic review is to really understand whether we are the highest value owner of those assets. And has Abbott shown any interest in acquiring those assets, or have you had any discussions with them? We haven't commenced any formal discussions with Abbott at this point. Okay. Thank you. There were no further questions at this time. I'll now hand back to Mr. Grant Watson for closing remarks. Again, a very, very challenging first half for Synlait. Today we're very pleased with the ongoing support that we have from Bright Dairy, from our banking syndicates. We are 110% committed to deleveraging the balance sheets, and it's important today that we signal to our farmer suppliers that we remain very committed to paying a market farm gate milk price. Thank you again for your time. That does conclude our conference for today. Thank you for participating. You may now disconnect.