Good afternoon, ladies and gentlemen, and welcome to this pre-close investor conference call of Libstar Holdings Limited. My name is Charl de Villiers. I am the Group Chief Executive Officer, and I am joined by my colleagues, Cornél Lodewyks, Executive Director, and Terri Ladbrooke, our Group Chief Financial Officer. The format of today's call, we will provide some color on the trading update that was published this morning on SENS, after which we will open the floor to those listening on the call who would like to ask any questions. If you would like to write up your questions, please use the chat function. If you would like to ask a question in person, please just raise your hand. We will identify you. Give us a second to unmute you are free to go ahead and ask the question. This pre-close update covers the 21-week period from the January 1st to May 31st, 2026. Importantly, the fresh mushroom operations that were disposed of effective on the December 1st last year, those have been excluded from the prior period to provide a like-for-like comparison of the group's continuing operations. We open the trading update by making a few comments on the consumer environment. You may recall over the past couple of trading updates, we have referred to our defined basket within the retail channel. That is a basket of our particular products within the retail channel. We mentioned that there was a declining value growth trend over the past couple of trading updates. Those trends continued into the current period, with the value growth settling for the past number of months between 1% and 1.3% since the start of the year in our defined basket. That is indicative of a constrained consumer environment. Additionally, we mentioned the fact that manufacturing inflation has intensified, driven by the sharp increases, particularly recently, by way of petroleum-linked input costs like packaging and distribution. In that context, and notwithstanding that context, the group's trading performance was below our original expectations, with the group turnover increasing by 90 basis points broadly in line with the prior period. Aside from those general inflationary pressures, which we want to put to the side, there were really two contributing factors to the differential between the original expectation and the results that materialized in the first half. Those relate particularly to our Dickon Hall Foods division, which is part of our wet condiments subcategory, our export dried condiments business. Just to provide some additional color on those two businesses in particular. At our Capital Markets Day and in our results presentation, we informed the market that we were in the process of consolidating our Dickon Hall Foods business for the remainder of that business into Montagu Foods, which is in the town of Montagu. That process of relocation commenced on the April 1st. Between the January 1st and the end of March, we were producing all of the lines within the Dickon Hall Foods Johannesburg facility. During the month of April, we started moving certain lines whilst other lines were still in production. At the end of April, we ceased all production, that facility was effectively closed down. Whilst production continued throughout the period that we are reporting on, the reality is that labor productivity, in particular, deteriorated significantly towards the end of that April period. That caused quite a few production disruptions, increased overtimes, reworks, which is possibly understandable given the fact that we were closing that facility. When we refer to those labor challenges, it was really a function of having labor on-site but not being able to produce the efficient production numbers that we had envisaged originally from the production time allocated and needing to then incur overtime as well in order to ensure service levels to our customers. In addition to that, we have in the past experienced some water supply disruptions in the south of Johannesburg. We do have water tanks on-site, but only enough to cover about half a shift or so, maybe one shift at max. For 25 consecutive shifts, we were without water, and that resulted in us needing to literally truck in water for production of wet condiments in that facility, which obviously also pushed up the cost element as well as contributed to the weaker production numbers as well. In summary, those factors contributed to a significant under-recovery of our manufacturing expenses in that facility, aside from the fact that the trade, in other words, the demand for those contract manufactured goods, were also slightly lower than expectation. To put that in context, the delta between our operating profit level that we expected and the actual that materialized was close to ZAR 17 million, which is a notable number in the context of our first half results in particular. The second element of underperformance in this set of results or update is related to our dried condiments export business, and that was impacted largely by, we refer to shipment timing. Demand out of the U.S. was quite soft in the first quarter. We started producing and ramping up production towards the end of the first quarter, but those goods have not yet shipped. There's about ZAR 20 million-ZAR 25 million worth of goods that are being shipped in June, which would've been earmarked originally for the prior months before that. Slower orders are mentioned in the U.S., but with that picking up towards the end of the quarter. The sustained strengthening of the rand against particularly the U.S. dollar, which is a major export currency, creating a deflationary price mix impact in that business, which also contributed to the deflationary impact in the ambient groceries category as a whole. Also weaker demand in Australia as well as Asia. That is something that we flagged previously that has continued with lower, particularly private label product sales within those regions. As a consequence of lower production numbers, also absorbing quite a significant amount of overheads without concomitant sales, and therefore impacting margins within the dried condiments facility. There were some highlights in this set of results. The dairy category, the wet condiments category, that's the core wet condiments category of Montagu Foods, Cecil Vinegar, and retailer brands, as well as the value-added meats categories. Those produced resilient top-line and bottom-line results, but only partially offset the drawbacks that we experience from Dickon Hall Foods as well as the dried condiments category as a whole. Looking at channel performance, food service was the strongest performer in the reported period with muted retail channel growth. I've already spoken to what's happening in the market, and then constrained performance in exports as well as the contract manufacturing side of the group. In terms of the group revenue numbers, those were broadly in line with the prior period, with growth, as I mentioned earlier, in the core wet condiments. Select Products, which is the business that comprises our Rialto retail and food service business, Ambassador Foods and Cape Coastal Honey, as well as baking. That was mainly supported by food service channel, but also stable retail and wholesale channel demand. That was, of course, then offset by the underperformance that I mentioned previously. In terms of group headline numbers, we've published a number of 0.9% or 90 basis points growth. That includes the entire business. Because a part of the Dickon Hall Foods business will be discontinued and only a part will be integrated into Montagu, we also reported a number exclusive of the Dickon Hall Foods revenue, with group revenue up 3.5 percentage points. The 3.5 percentage points tracking ahead of our defined retail basket. Our retail channel sales were up about 3.2%, but still not at our original expectations. Looking at the individual super categories. Perishable products category revenue increased by 1.6%. That was driven by volume increases of 0.8% and a price mix contribution, a decline, sorry, of 0.8% at price mix contribution. The growth in volumes came from our core dairy categories. That would be hard cheese, soft cheese, and yogurt, and the declines coming from our non-core part being butter, pasteurized milk, maas, and juice. I've already mentioned a resilient volume growth from the value-added meats business, also within the food service channel. Turning to the ambient products category. Revenue increased by 0.2%, driven by a volume increase of 1.2%, but then a deflationary price mix impact, which was driven by that currency impact in the export dried condiments operations. Strong performances, again in food service with the core wet condiments category, performing better than the market in the retail channel. I already mentioned weaker sales in Australia as well as Japan, as well as the lower industrial and contract manufacturing sales in Dickon Hall Foods. From a gross profit margin perspective, we mentioned the fact that gross profit margins were tracking between one and one and a half percentage points lower than the prior period, predominantly as a consequence of the under-recovery of costs in manufacturing within the Dickon Hall Foods as well as the dried condiments categories. We don't want to blame the inflationary pressures of petroleum. That, of course, did have an overall impact on the group, but to a lesser extent than the under-recovery of the fixed overhead costs during this particular period. Gross profit margins in the perishable category itself increased year-on-year. That was supported by a favorable mix change in dairy, in particular, stable milk pricing, and then also production efficiencies within the dairy subcategory, as well as value-added meats. That was then partly offset by lower margins in convenience meals, driven by higher promotional spend in that subcategory. Gross profit margins in the ambient category, those declined year-on-year, where margins expanded in core wheat condiments, supported by improved utilization. Also of some of those lines that have been incorporated into the Montagu Foods site and cost controls. That was more than offset by the material under recovery within the Dickon Hall Foods and dry condiments businesses. In terms of controllable expenses, manufacturing expenses, operating expenses rather, those increased below 4%. Recently published CPI is 4.5%, below 4% increases, reflecting disciplined cost management of controllable expenses. In terms of an update on our two major capital projects that we spoke to at the Capital Markets Day, pleased to report that both of those have progressed in accordance broadly with our cost as well as our timing estimates. With the completion of our Montagu Foods integration at the back end of July, production commencing at the start of August. Then the Cape Herb & Spice integration of various blending and packing sites, as well as a warehouse into a single site, completing at the back end of May 2027. From a balance sheet and cash generation perspective, notwithstanding the weaker trading that I referred to earlier, our cash flows have remained resilient. We have continued to allocate capital in a focused manner and also have been managing our networking capital as best as we can, which included further reduction of our bulk tea inventories, which is a category which contributed to networking capital improvement in 2025 as well. In terms of our key balance sheet ratios, our gearing ratio improving from 1.6 to 1.3. Also our interest cover ratio improving from 5.9 - 7.9 x, reflecting the improved working capital situation, as well as resilient cash generation from the remaining operations. I'm pleased to report in terms of our objective to exit our underperforming and household and personal care categories that we have entered into a binding agreement to dispose of our Phesantekraal property in the Western Cape. That property transfer is expected to take place early H2, so not in this half. It will further contribute to the strengthening of the group's already strong balance sheet position. Whilst discussions in relation to the disposal of Contactim remain ongoing, we are making progress, albeit slower than originally expected. We've continued our share repurchase program. To date, we've utilized ZAR 43.3 million to repurchase 9.4 million shares at an average price of around ZAR 4.59 per share. It is our intention to continue that share purchase program during the closed financial period, which we will enter on the July 1st until the date on which we publish our interim results. Although this was a four-month, five-month period in which we didn't trade in accordance with plan, we have accelerated our mitigating actions, including targeted pricing adjustments. You might ask, what is the quantum of those pricing adjustments? I would respond to that, on average, pricing adjustments of between 3%-5% in order to compensate for existing and known inflationary pressures. Also focusing on our labor efficiency whilst accelerating the initiatives that are currently underway, such as the Cape Herb & Spice site consolidation in order to ensure that we remain competitive. Although inflationary outlook remains elevated in the short term, short to medium term, we do expect an improved H2 performance. Why? Because that is traditionally also our waiting in terms of trade towards the, in terms of seasonality, towards the second part of the year. The pain taken on the Dickon Hall Foods site, in terms of the first four months of the year, it will not be repeated. We look forward to commencing our production on time and within our cost estimates from the start of July. Then also continuing our processes around integration and cost savings, which are ongoing programs. In a nutshell, not happy with how the first five months have panned out, but we have taken action in terms of pricing as well as interventions, and also looking forward to not repeating some of the first five months' performance, you know, unexpected costs. With that, I will open the floor to any questions. I can already see one or two, and I will ask Terri to moderate that for us, then we will deal with them one by one. Thank you very much for listening. Sure. We did receive a question from Nick Wilson at the beginning of the call. I do believe we have covered most of it, but I will read through it just in case. Nick says, "Hi, Charl and Libstar team. You mention labor challenges and water shortages in your trading update. I was hoping to get more color on this. What were the specific labor challenges and what did they relate? Was this to do with the integration of Montagu and Dickon Hall Foods? What were the water shortages about? Which area and why? Was this related to failing municipal water infrastructure, and if so, where? If these are municipal-related challenges, is Libstar considering moving any facilities because of this?" Two main themes here. The first one around labor challenges, which Charl did cover, relating to the closure of Dickon Hall Foods. Not in terms of the integration of the two sites, but specifically to the closure of the Dickon Hall Foods site. Then secondly, around water shortages, again, also in Dickon Hall Foods, which is in the south of Joburg. That was specific to the area and to municipal-related items. As we are closing that site, the risk there is reducing. Just in terms of further mitigation, there is a major water reuse project which is currently underway within our Lancewood George facility. We aim to be very close to water neutral once the various phases of those projects have been concluded, and that reduces our reliance on municipal infrastructure. It has been a perpetually difficult site for us, that one in the south of Johannesburg in particular, and we haven't had the magnitude of water supply disruptions in any of our other sites thus far. That hopefully bodes well for what's to come. Thanks, Charl. Just a reminder, if you do have a question to just add it to the chat or to raise your hand. Currently, we have no further questions, and here we go. Dirk, I see you. Cool. [Cam], if you could please just unmute Dirk for him to ask his questions. Great. Thanks, guys. Can you hear me? Yes. Yeah. Fantastic. Thanks for the update. Just two questions from my side. There were two divisions that I think were struggling a bit last year, and apologies if you've mentioned them specifically, but how are things going at Amaro Foods and, there was one other. Yes Ambassador? Yeah. Amaro Foods has had a strong top-line performance in the year, driven predominantly by food service, but also retail. Although, from a margin perspective, we haven't tracked completely on plan. We have improved our overall performance relative to the prior year in that business. Within the Ambassador Foods business, the good news is that we have been able to produce and sell, and service the market appropriately for the entire period that we've reported on. Sales have been slower than anticipated, and that has had an impact on margins, with that business tracking broadly in line with the prior year relative to an expectation that we would be quite considerably above the prior year. There's a lot of newness coming in that category in the second half of the year, which we hope will reinvigorate some of the interest in that category. Okay. In that category specifically, Charl, if I remember correctly, it was actually the second half last year that was quite weak in terms of profit. Correct. 100%. Okay. Okay, thanks very much. Those are my questions. Thank you, Dirk. We have a follow-on question from Nick. Just a follow-up question. The south of Joburg facility is being completely closed, this is going to remove water risk issue from equation. That removes the water risk for Dickon Hall Foods. That site is being closed. We do have other operations in Johannesburg and close to that site. However, they are less dependent on water as Dickon Hall Foods was in the wet condiments. Okay. If that's okay to add. We have a couple of questions from Anthony Clark. "Hi, Charl. Can I ask why value-added meats did so well? Did you push the button on expansion?" Maybe we answer that one before we continue. You could ask this. Okay. Yeah. The answer is, Anthony, no, we have not pushed any buttons on capacity expansion. We've been able to utilize our capacity in terms of our operating efficiencies slightly better, but it doesn't remove the longer-term consideration around capacity expansion. That category, particularly coated chicken, remains a category that grows ahead of other market categories. As a result of that, as well as being able to produce more efficiently, we have been able to produce an improved result relative to the prior period. The consideration around capacity moving forward, that remains firmly a part of what we will be considering in the next half of the year. Great. The second question from Anthony is: Given where the Durbanville land sale is, in brackets, the new airport, did you get a good price for the site? We believe we made the right decision for the business and got a good price. The consideration to take into account is that the site was in an agricultural zoned area and not in an industrial zoned area. There is a big process to go through to be able to benefit from that new development. However, we are expecting an after-tax profit on sale in the region of ZAR 30 million from the sale. That's profit on top of book value, so the proceeds being higher than that. We've got a hand first from Craig. Corné, if you can unmute Craig to ask his question. Hi, guys. Just confirming you can hear me as well. Yes, we can. Perfect. Good afternoon to all, and thanks for the call. Just to explore the targeted pricing adjustments a bit more, Charl, that you mentioned. I do not imagine it is across all the categories. It is obviously in certain areas where you have been able to achieve that in the past. Is the trading update indicative of where you have been able to pass through price, i.e., in perishable, but basically in core dairy, or have you been able to do it in other segments, just to get a sense of how you are able to pass that on? Thanks. I think one should not read too much into the perishable versus ambient category performances here because the devil is certainly in the detail of the underlying performances. When you strip out Dickon Hall Foods, as I mentioned earlier, the ambient category grew revenue by over 5.9%. That would definitely not be indicative of a category which that would have not been fully volume driven, so to speak. I think the reality of the matter is that there is always a lag effect in terms of us absorbing cost initially and the timing taken to pass that on. We have actioned that, we have actioned that within the bounds of reasonable possibility within the environments in which we operate. It is not a one-size-fits-all approach. It is more broad-based, I would say, with varying degrees of possibility throughout the category, depending on the dynamics of that particular category. Thanks. Broad-based is the takeaway. Thank you. Yeah. Thanks, Craig. We have another question from Dirk. Yes, thanks. Sorry, just a follow-up, maybe to give Cornél a chance to speak. Cornél, maybe just an update on milk supply and foot-and-mouth more broadly, I've got a follow-up on Cape Herb. Dirk, yes. Close to between 75%-78% of our farmers or milk farms has been vaccinated. No real issues in our capital markets there. I mentioned earlier that was, I would call it our biggest risk earlier the year or biggest headache, I suppose, the increasing fuel costs on milk transport, primary transport and distribution costs. That was our biggest focus to recover some of that. We went to market with the second price increase, it's a continuous process. Margin protection and improvement was a key focus for us this year, where working capital and cash flow last year was a big focus for us. Maybe just to follow- up, with feed prices so low, is there a chance raw milk prices actually go down? Is there deflation potential in the summer season when obviously there's more flow? I doubt it. It's still early on commodity pricing, when feed pricing is still low. Obviously, increase in fertilizer costs, obviously due to the crisis in the Middle East. We don't expect pricing to come down, it will be stable. Remember, we also had very wet conditions in the Southern Cape rainfall, where I would rather say towards the end of this year, early next year, price increases impact of El Niño and so forth, stable pricing for the remainder of the year. Okay. were your facilities okay given the bad weather in George and Southern Cape? Yeah. When we had that severe wind in George, one of the DC doors, it was minor. We were actually very luckier, but one of our sites, a small damage in the DC, but it was a door, a dock leveler, but nothing severe. Okay, thanks. then just the last question from me on just on Cape Herb. Charl, maybe you can update us just on the U.S. tariff situation and how that's kind of played out. Tailwind, headwind, relative to your expectations. The reality is that there's a theoretical side to it where there's a tariff refund structure, and then there's the reality of whether it has really panned out and we've been able to mechanically affect that, which hasn't yet been the case. at this point in time, it's fairly neutral, Dirk, to where we stood previously. Okay. Thanks, guys. Thank you, Dirk. We have another hand. I believe this is Sunil Suraj. Sunil? You are unmuted, but we can't hear you Sunil, if you could perhaps ask a question on the chat because I don't seem to hear you. While we wait for you, I'm just going to move to a question from Samantha in the chat. "Hi, a question regarding the decline in exports of dry condiments in certain regions may be a continuing factor from FY 2025. Any further detail on this? Are there broader shifts to highlight? Yeah. Samantha, I think that's a fair comment. We mentioned that, particularly in the private label space, there are annual tenders in which we participate. Some of those tenders, in particular in private label in the Australian region, were not renewed. That over and above the fact that where we are supplying that region, the demand remains perpetually, if I could use that word, soft. That has been slightly weaker than expected. What we didn't expect is that we usually have quite a bit of promotional participation in the first quarter in the U.S., which didn't transpire to the extent that we expected. As a consequence, the U.S. was also soft. Having the double whammy was, I guess, the surprise as opposed to knowing which tenders were not going to renew. From a structural perspective, no structural shifts aside from the fact that with a currency that remains as strong as it currently is, that does place pressure on margin in an already competitive category. Great. Thank you, Sunil, for adding your question onto the chat. We note that your microphone is not working. Your question is on Dickon Hall Foods. Does the current trading account for the loss of the significant contract manufacturing customer? Sunil, that is correct. When we quote a 0.9% revenue growth, that is after the loss of certain revenues from April, for the month of April and May. When we quote a number that excludes Dickon Hall Foods in totality, for the first five months, revenue increased by 3.5%. Very important to note that we are expecting a softer revenue growth from a group perspective as a pure consequence of that's why we show both numbers so that you can draw your own conclusions from that. Great. Another follow-up from Sunil is just, "Furthermore, which group revenue growth is the actual revenue growth number reported?" I'm guessing it's the 0.9%. Yes. Total group, like- for-l ike, 0.9%. Excluding Dickon Hall Foods, which is all contract manufacturing, that is 3.5%. Great. Okay. Great. Thank you, everyone. I don't see any further hands raised or any additional questions coming through. Thank you very much for all the questions that were raised. Thank you everyone for joining. We appreciate it, and we will see you when we publish our results on or about the September 8th of this year. Thank you very much, and have a good afternoon.