Good morning, ladies and gentlemen, welcome to the ARB Corporation 2023 full year financial results presentation. My name is Lachlan McCann, Chief Executive Officer at ARB, joining me today is Damon Page, ARB's Chief Financial Officer and Company Secretary. Today, Damon and I will take you through a financial update of the results, present to you the business' domestic and international sales and operations. Some housekeeping before we commence. During the presentation, questions can be made through the chat box. At the lower right-hand corner of your screen, you will see a blue circle with a hand icon. By clicking on this, it will open a chat box for you to enter your questions. At the conclusion of the presentation, Damon and I will endeavor to answer these questions.
I'll now hand over to Damon to take you through the financial results of the business.
Thanks, Lachlan, and good morning, and welcome to our presentation today. All of our year-end documents were lodged with ASX earlier this morning and are available on the ASX website, along with a copy of this presentation that we will step through today. We report that ARB achieved sales revenue of AUD 671.2 million for the financial year ended June 30, 2023. This compares with last year's sales revenue of AUD 694.5 million, a decline of 3.4%. Sales revenue improved throughout the course of the financial year, after reporting a decline of 10% for Q1 at the annual general meeting in October 2022, and a 5.1% decline at the half year.
Sales have broadly consolidated the growth since 2020, with compound average growth of 13% over the last three years. Profit before tax of AUD 122.1 million was achieved. This compares with the profit before tax last year of AUD 165.7 million and is a decline of 26.3%. The decline in profit before tax is slightly improved on the half-year results, which reported a decline of 29.7%. A number of factors impacted on the profit result, which are called out at the bottom center of slide 4. High inflation impacted the business throughout all of the financial year. Whilst management has sought to manage operational costs very tightly, inflation had a significant impact, particularly on cost of sales.
In terms of both procured goods from third parties and internally manufactured products with raw materials, such as steel and power costs, experiencing significant price increases. Whilst ARB put through a number of sales price increases to counter the inflationary impacts, the sales price increases trailed the cost increases, and it has taken some time for these price increases to take full effect, given the continued sizable customer order book. The weaker Australian dollar increased those cost of sales manufactured in our Thai factories and those procured from around the world, which are often denominated in US dollars. The company's exposure to US dollars has historically been closely hedged through its income generated in the USA, which declined this year, leaving the company more exposed to that currency. Lachlan will talk more to the decline in US sales shortly.
The company built stock significantly over the last 2 years to mitigate against supply chain disruptions, which resulted in an over-recovery of fixed costs in prior years, which has not occurred again in this financial year. Finally, the company has increased its non-cash provisions for inventory obsolescence and warranty costs by AUD 3.1 million and AUD 1.2 million, respectively. In line with sales, the compound average growth in profit before tax since 2020 is 16.1%. On the right-hand side of slide 4 there, we see that profit after tax of AUD 88.5 million was achieved. The decline of 27.5% is slightly higher than the decline in profit before tax, due to higher earnings generated in higher taxing jurisdictions, specifically in Australia.
Moving across to slide 5, where we look at the group sales by channel, being the sales into the Australian aftermarket, export sales, and sales to the original car manufacturers or OEMs. Sales into the Australian aftermarket continued to grow and reached AUD 383.5 million, an increase of 2.6% over last year. This particular market or channel includes sales from ARB's three subsidiaries: SmartBar, producing and selling cross-linked polymer products from its roto-molding factory in Adelaide; Kingsley, operating out of Sydney, designing and wholesaling 4x4 accessories; and Go Active Outdoors, representing the Swedish brand Thule here in Australia. Now, the Thule brand was a beneficiary during the COVID period, when sales within the bicycle industry really took off. Go Active sales of Thule products pulled back materially this financial year.
The Australian aftermarket sales, excluding Go Active's Thule decline in sales, grew by 5.2%. In the middle of the slide there, export sales achieved AUD 245.2 million, which is a decline of 8.7% compared with last year. This is in line with the decline reported at the half year. The decline in export sales is largely attributable to the US, which was particularly impacted by the trade sale and subsequent restructuring of ARB's largest customer in the US, which has since downsized its retail network. On the right-hand side of the slide there, sales to OEM are more volatile based on the timing of contracts starting and ending and the timing of motor vehicle releases.
Sales revenue of AUD 42.4 million for the financial year ended June 30, 2023, were down 18.5%. A turnaround, as we've previously flagged to the market from the decline of 36.9% at the half year. The second half sales to OEMs were up 19.7% on the first half. New contracts are already in place with the OEs, which will underpin solid growth in this sales channel in both FY 2024 and FY 2025. Note 6 includes a graph detailing dividends paid by the company over the last 10 years. All dividends throughout this period have been fully franked at the 30% corporate tax rate. Pleasingly, dividends have been fully funded from operating cash flows.
Total dividends of AUD 0.62 per share this year represents a dividend payout ratio of 57%, which compares with a dividend payout ratio of 48% last year. The record date for the final dividend is 6th October 2023, and the dividend will be paid on 20th October 2023. Both the dividend reinvestment plan and the bonus share plan will be in full operation for the final dividend with a 2% discount applied. Slide seven provides us with an overview of the company's profit and loss statement, including year-on-year movements against last year and expenditures shown as a percentage of sales in each year.
Having spoken to sales already, the key item to focus on is the materials and consumables used line, which highlights the decline in sales margins, with materials and consumables used increasing to 47% of sales in the financial year, ending June 30, 2023, compared with only 44% in FY 2022. I spoke earlier to the key items driving the decline in sales revenues or sales margins, I beg your pardon, being cost inflation, the subsequent lag in ARB's sales price increases, and lower factory recoveries. Employee expenses increased 4% during the year, broadly reflecting the annual wage reviews processed during the half year. Advertising expense is a notable and deliberate increase at AUD 7.3 million for the year, which is an increase of 25% over last year and is really a return to historical levels for advertising and marketing.
Occupancy expenses, whilst consistent at 2% of sales, increased 6.5%, reflecting the impact of inflation, particularly in respect of power costs. Other expenses increased AUD 4.2 million or 37%, with employee traveling returning both domestically and internationally, and insurance premium costs continuing to rise. Now, we provided substantial information around the non-cash adjustments to Truckman-related balances at the half year, specifically the AUD 13.7 million right-back to profit of contingent consideration that is unlikely to be paid due to performance post-acquisition, which is broadly offset by an adjustment against goodwill, both non-cash items. Lachlan will talk to Truckman's turnaround later in the presentation. Management made a concerted effort to closely manage operational costs during the financial year, and we're pleased to report that gross profits in Q1 of FY 2024 have returned to historical levels.
Across on slide eight, the company generated cash flow from operations of AUD 90.4 million. This compares with the profit after tax of AUD 88.5 million. Now, two key factors impacting on cash flow from operations are firstly, the higher inventory value of AUD 9.6 million, noting that the increase in inventory values is attributable to the introduction of new product ranges and the cost impact of inflation and the weaker Australian dollar. That is, inventory volumes decreased over the period. Secondly, the payment of taxes with a AUD 9 million provision carried over from the previous year, compared with a AUD 3 million tax receivable recorded at the end of the financial year.
Last year's tax installments were yet to reflect the increase in profits, resulting in the large year-end provision, whereas the installments this year did capture the impact of those higher profits, resulting in an overpayment this year. The company invested AUD 40.6 million in property, plant, and equipment, with AUD 21.6 million spent on property and AUD 19 million spent on plant and equipment. The company has taken on a significant property expansion program over the last two years, with its fourth factory completed in Thailand late last calendar year. The expansion of its national warehouse in Melbourne, which was completed in July this year, and the ongoing development of its corporate head office in Melbourne and its site in Hamilton, New Zealand, where the Beaut Utes and Pro-Form businesses will be consolidated.
The company also paid AUD 45.3 million in fully franked dividends, being last year's final dividend, paid in October 22, 2022, and this year's interim dividend paid in April 2023. The DRP and BSP take up represented 15% of the total dividends. At the end of the financial year, the company held AUD 44.9 million in cash and had no debt. I'll hand the time back to you, Lachlan.
Thank you, Damon. Let's start with a look at the Australian sales and those vehicles core to ARB's business. In the year, we saw a slow recovery to vehicle sales. A combination of factory supply constraints, Australian port disruptions, and competing demand from other markets on OEMs constrained vehicle sales, particularly in the first half. Both the Ford Ranger and the Toyota Hilux 4x4 models recorded strong growth in the year of 30.1% and 18.3% respectively. We understand the order banks for these models remains high, and we expect to see strong deliveries through the first half of the new financial year. There were some inconsistent results, however, in other 4x4 pickup models.
The Mitsubishi Triton has an impending model change, and the Isuzu, Isuzu's supply of the D-Max and Toyota supply of the Land Cruiser 70 Series has been constrained despite strong demand. ARB was very pleased to see sales of the iconic Land Cruiser 300 Series, previously 200 Series, return to historical levels. We'll now move on to domestic and international sales, and firstly, to the domestic business. ARB's aftermarket business in Australia is comprised of sales through corporately owned stores, independent ARB stores, stockists, various forms of wholesale resellers, and new vehicle dealerships and fleet. As Damon mentioned, also included in these numbers is ARB's subsidiaries, Go Active Outdoors, representing Thule Group in Australia, Kingsley Enterprises, and SmartBar in South Australia. Some areas of the business operations constrained sales. While ARB is pleased with the increased revenue, we're cycling off a higher COVID base.
Some areas of the business were materially impacted as we worked our way out of COVID. As Damon mentioned, Go Active's Thule products are a good example of this, and the challenges of the bike industry globally are well documented. Representing 71% of ARB's core sales, we have an incredibly engaged and reliable distribution network. From independent ARB flagship store owners all the way through to family-owned garages in regional and remote Australia, ARB has a motivated and diverse distribution network underpinning the largest part of the ARB's business. ARB's core aftermarket business... Excuse me, we're just moving forward. ARB's core aftermarket business performed well ahead of the reported 2.6% revenue growth. Our total orders remained at historically high levels. The longer-term fleet order book remains high as vehicle supply catches up with demand.
The business is very focused on short, short-term workshop output as vehicle supply continues to improve, particularly over the next six months. On to slide 13. ARB derives its strength from being a branded house and not a house of brands. The launch of the ARB Earth Camper, which will be discussed later, is a great example of how ARB is uniquely positioned to leverage our product innovation, brand, and quality of Australian distribution network to put products to market efficiently and effectively. ARB has had a frustrating month in new store development. There are a number of stores at 80+% completion that we'd expected to have opened now, which we look forward to providing more details on at the upcoming AGM. The business has a strong plan to accelerate new store rollout.
ARB's store roadmap for the coming years is very well developed and underpins our continued growth in Australia. On to slide 15. As mentioned earlier, the order bank remains an opportunity for ARB, both corporately and for our independent store network. We have been constrained by access to labor for fitting. We have four key strategies within the business to address this. Number one is upskilling our workforce. Improvements in training and engagement with the existing employee base to support the diversity of their skills and career development. Number two is targeted induction programs. Site-specific programs where we inject handpicked trainees working with experienced ARB technicians and qualified trainers on an eight-week fast-track program. technician pathways.
Many ARB branch managers and even select state managers started their career at ARB as fitters, providing clear milestones in the breadth and the depth of fitting competencies in ARB workshops as a technician, then moving people and moving the team towards people and branch management has engaged and motivated our teams. Then finally, ARB Corporation and our independent distribution network has employed offshore workers. These employees have commenced at ARB stores. The program is currently under assessment. On to slide 16, our engagement with Ford in Australia. The Ford Licensed Accessories program is where ARB has partnered with Ford Australia to deliver in excess of 180 branded accessories, ARB branded accessory products for the Ford Ranger and Everest platforms, available through Ford dealerships with Ford's full 5-year warranty. Both Ford and ARB are very happy with the program.
The personalization packs have been particularly engaging with Ford's Ranger clientele, and the partnership has delivered new fleet opportunities with our combined offering. The Ford and ARB dealer network have been very supportive of the program as we continue to look at new opportunities for future expansion. Ford's endorsement of ARB continues to strengthen our brand position in the Australian aftermarket. On to our OEM business. ARB's OEM business had a weak 12 months, with sales declining 18.5%. This was by forecast and reflects the cyclical nature of this business. An OEM full-service supply contract typically has a two to four-year development cycle, and currently, ARB's OEM engineering team is running at capacity with a record number of future projects on hand. Sales are expected to grow in the financial year 2024, particularly in the second half.
Slide 18 and the USA business. The US business had a challenging 2023 financial year amidst continued restructuring of key accounts. In response to this, ARB broadened its wholesale customer base, both geographically and by product segment. Demand for ARB products in the US remains strong. Structuring the right channels to market continues to be our focus. As a part of our US strategy, 2 key direct-to-consumer initiatives are due to launch in the current financial year. The e-commerce platform is nearing completion and is planned to launch in September 2023. We're conscious we're late to the party in this B2C direct online initiative, we remain incredibly excited about gaining new customer insights, digital sales activation, and enhancing our US customers' purchasing experience with ARB USA.
The second initiative is the development of our flagship store, due for launch in the second half of the new financial year. Design plans are complete, as are council approvals. We're on track to commence construction imminently. Further initiatives to grow the U.S. business are well progressed. We look forward to presenting more information on these initiatives at the upcoming AGM. A further exciting development in the U.S. is ARB Corporation's work with Toyota USA, who we've been engaged with for a number of years now. Toyota has identified ARB as a core brand partner, as a part of its strategy to position Toyota vehicles in the overlanding space. The Toyota Tacoma Trailhunter, featured on screen, is a halo model vehicle and peer to the TRD Pro, which focuses on the overlanding market.
Within this partnership, ARB has worked with Toyota Engineering to develop five core vehicle accessories featured on this slide, which will be factory fitted by Toyota and are a part of the standard equipment on this platform. The partnership has afforded ARB the opportunity to demonstrate our OEM capabilities as an engineering and manufacturing company, which we're confident will provide more opportunities into the future. Toyota globally are leaders in automotive marketing. They invest heavily in all marketing channels for their halo platform vehicles. This exposure for ARB and Old Man Emu products in the U.S., as the Trailhunter goes to market, is very exciting and builds long-term brand recognition in a very large and complex market. ARB has won additional contracts with Toyota USA, which we look forward to elaborating on in future presentations. The Ford partnership with Ford USA continues to grow.
In terms of revenue, Ford USA has become a key global account for ARB. The new Ford Ranger release is imminent, and while the vehicle looks the same as the Australian model release, aside from the steering wheel being on the wrong side, there are other key structural differences to the US model, which has kept our engineering team busy. ARB has worked with Ford Engineering on the development of more than 15 core accessories that have been validated by Ford, including extensive crash validation on the new Summit style front bumper. These accessory products will be available at launch through Ford's various sales channels, including wholesale distributors, direct, online, and dealer channel. ARB continues to work on taking both the Ranger and Bronco products up-channel and have them as core content fitted prior to dealer delivery. On to slide 21, and ARB's export business.
The export business outside the US and New Zealand had a very positive 12 months. Strong growth through ARB's office in Prague was a highlight, underpinned by new account development and improved pickup vehicle availability in market. This growth has pushed us to expand in the coming months from our current 3,000 square meter site in Prague to a new 5,000 square meter warehouse. Pleasingly, sales through Truckman have recovered in the second half of FY 2023. The sales uplift is directly correlated with improved vehicle availability in market and is expected to trend positively in the new financial year. Pro-Form Plastics are part of ARB New Zealand, a manufacturer of extruded ABS plastic sheet and thermoformed parts, struggled in FY 2023. Pro-Form has healthy exports of plastic sheet and supplies various OEM and global aftermarket customers with thermoformed products.
Persistently high outbound container freight costs from New Zealand and high customer stock levels post-COVID impacted Pro-Form sales. We do expect this to recover in the new financial year. ARB's head office expansion in Hamilton, providing new warehousing space and a flagship showroom, is due to be complete later this calendar year. Finally, an insight piece. ARB markets and sells to diverse and emerging markets. As a point of interest today, I wanted to highlight some recent work in Mongolia. A typical winter in Ulaanbaatar, capital of Mongolia, will see temperatures drop to below minus 40 degrees Celsius, affecting various parts of the vehicle, including shock absorbers. Understanding this, our engineering team worked closely in-market to upgrade and improve the premium BP-51 shock absorber, used extensively in Mongolia by recreational and fleet customers to function in these extreme conditions. On to products and operations. Earth Camper.
Following a six-year engineering and manufacturing development, ARB has launched the all-new Earth Camper, the company's first foray into the caravaning sector. The camper is a ground-up development and beautifully showcases the diverse capabilities of ARB's engineering and manufacturing teams. The product is proudly manufactured in-house using existing and new production equipment. We are finding our feet in production and carefully controlling and executing the quality of the camper builds. The launch was a huge success both in Australia and overseas. Following the Melbourne 4x4 show at the weekend, we have now exceeded 1,000 registrations of interest in Australia and surpassed 500 registrations of interest overseas. At launch, the Earth Camper trended 32nd most viewed video on YouTube, with walk-around video reaching half a million views online. The online viewership in the US exceeded that of Australia, which we're observing very closely.
The camper has commenced sale in Australia. Units are being retailed today. At this time, the camper is only available in Australia. We do expect in the new financial year to sell the camper to the US and other overseas markets. It will make its first public appearance in the US at the SEMA Show in October 2023. For those of you who missed the launch of the camper online, we'll just play a quick video so you can get some insights into this fantastic new product.
Look at the way that I do it so good. Look at the way that I do what I should. Look at the way that I got you amazed. Look, did you see the look on your face? Look at the way that I bang with the bass. Look at the way that I'm running the place. Look at the way that I'm keeping the pace. You see the smoke? Well, look at the flames. I see the look in your eyes. It be the look of surprise. I know. That's just a part of the game. Uh-huh. You gotta look for them guys. You know. Look at the way that we ain't gonna fall. Look at the way that we are gonna rise. Look at the way that I answer the call. Look at the way that I handle the light. Look at the way that I ride. Alright.
Look at the way that I roll. I roll. Look at the way that I'm live. I'm live. Look at the way that I'm going. I'm going. Double up, let me in. Look at the way that it's okay. Double up, double it. Look at the way that I roll it.
We hope you enjoyed that video, and we look forward to updating the market as this fantastic new initiative from ARB develops. On to the next slide, and the ARB engineering machine continues to churn out new products. In the last week, ARB launched our airbag and parabolic leaf spring solution, which enables customers to carry variable vehicle payloads, high and low, with one spring solution, maintaining excellent ride control and comfort. Using the ARB BASE Rack dovetail design for accessory attachment, ARB has also launched the ARB Bed Rack. This low, low-profile tub rack will provide customers with a flexible solution to carry types of accessories and integrates with the ARB BASE Rack. The Bed Rack range will be a focus for US model vehicles. The Volkswagen Amarok has recently launched in Australia.
This vehicle has been developed off the Ford Ranger platform, as such, at launch, ARB had near a full complement of accessories ready for market. An important lineup in Australia, but also for the European market, where the Amarok sells very well. The rugged ARB HardLid, manufactured from steel tread plate material, has recently launched. The heavy-duty lid provides high load carrying capability and again integrates ARB's dovetail design. Finally, this Friday, ARB will launch a long-term development product. This is a global product designed and manufactured in-house and falls in our Old Man Emu suspension category. Watch this space this Friday for this exciting launch. On to slide 26. ARB will soon release edition two of the ARB Sustainability Review through our website.
Key call-outs in this update include our renewed investment in global education of our employees, suppliers, and contract workers on safe work practice, including the importance of mental health in the workplace. ARB holds framed agreements with global aid agencies, including UNHCR, World Food Programme, Red Cross, amongst others. ARB supports and guides aid agencies globally in their fleet pre-preparation for remote area travel. ARB is now a member of the Australian Packaging Covenant Organisation. We have made our first submission on ARB's packaging consumption, developed an action plan for improvement, and received from APCO a good progress rating. Finally, ARB's access to global OEMs, including Rivian, Toyota, and Ford, uniquely position us at the forefront of accessory compliance with electric and hydrogen platforms as this vehicle population grows. Onto ARBU. We have continued to invest in our people culture as we expand globally.
While daily in-person interactions with our staff are fundamental, the addition of our online platform, ARBU, has been an efficient, effective tool to onboard and educate our employees on the company's history, safety, products, and best practice in product fitting, manufacturing, and sales. We have almost 2,000 registered users, nearly 100 online ARB course-specific completions and multi-language capability, and an exciting rollout of a customer management experience in store. Finally, to the company outlook. The company's outlook remains positive, with ongoing healthy demand for ARB products, improving new vehicle supply around the world, stronger gross margins, and new products recently and soon to be released to the market. The board anticipates sales and profits to grow in the 2024 financial year.
Pleasingly, the company's gross profit % has recovered to historical levels, with recent price increases now fully in effect and product costs moderating after a period of strong global inflation. The board is pursuing a number of exciting long-term opportunities, focusing on export markets, new partners, the release of new products, further expansion of ARB store network, and improved distribution in Australia and internationally. ARB is well positioned to achieve long-term success with strong brands around the world, loyal customers, a capable senior management team and staff, and a strong balance sheet and growth strategies in place. That concludes the presentation today, and we'll move on to questions that have been filed on the online chat forum during the presentation, and I'll hand over to Damon.
Okay, thanks, Lachlan. We'll just kick off with a couple of questions relating to financial area. We have a question here about an improved outlook for OEM supply in FY 2024 and what impact that change in sales mix will have on group margins. ARB's historically had OE sales of up to 10%. We haven't really had OE sales exceed 10% previously. I think we're sitting at about 6.5% for this financial year, we expect to fluctuate between 6% and 10%. We're not gonna move outside of our historical boundaries there. The OE margins are obviously a little bit less than what we than what we achieve on our branded sales, but they do contribute quite significantly, of course, to our overhead recoveries through the factories.
Whilst, whilst we'll have some increased sales through that particular channel in the coming 2 years, it won't materially impact on the gross profits or the margins on the margins achieved by the group. I'm just getting some feedback there through the host. The impact on group margins is not expected to be material. It won't shift the dial materially, but it will perhaps slightly drag down the group margin, but that will be recovered through the overhead recoveries.
Okay, moving through the questions, I'll tackle one. What are the expected costs associated with the National Fitting Performance Program? Could you please provide an update on your ability to secure fitters versus the constraints you were expecting earlier in 2023? In line with recent data around unemployment, we have seen improved access to staff. There are a couple of states and metropolitan areas in particular, that continue to cause concerns. However, more broadly, there is improved access to fitting employees. And we've also matured newer employees into the business to have them become more efficient and effective. In terms of the costs associated with the fitting performance programs, well, they're very measured.
We have invested in ARBU, as mentioned, and the course completions we've found particularly helpful and insightful to educate new fitters into the business cost effectively and in a short amount of time. That program is really cost-minimal to the business. Thanks for the presentation. Has Seattle store been delayed, originally indicated in Q1, calendar year 2024? We did experience a delay in council. The site, which will be beneficial long term, is actually next to a bus terminal. The bus terminal is undergoing reconstruction, which had delayed and created some issues in the short term with the local council. We are now past those. Yes, to the question, it was a delay to the program.
Look, we are still definitely looking within this financial year to launch it, but definitely in the second half of the current financial year to get the Seattle store up and running.
Yeah, I think there's just been a little bit of confusion there, because previously we've said Q1 calendar year, calendar 2024, and there was a reference there to second half FY 2024.
FY 2024.
Still within the first half of calendar 2024. There's a question as to what the company plans to do with its AUD 45 million cash balance. The company has, over the last couple of years, undertaken a fairly significant capital expansion program in property particularly, but also through acquisitions of plant and equipment. This program continues. We'll see the remaining two major projects complete in calendar 2024, being the construction of a corporate head office in Melbourne and also the consolidation of the Beaut Utes and Pro-Form sites in New Zealand. There's still some capital expenditure to come in those two projects.
We're, we're also yet to fully complete the fit-out of our fourth factory in Thailand as well, so there's some capital expenditure to come there. I think as we look historically, ARB's operational cash flows have typically been spent about half of it on capital expansion and half of it on payment of dividends. With, with the cash surplus at the moment, we noted earlier in the presentation that the board had increased the dividend payout ratio from high 40% last year to 57% for this financial year. That cash, we expect to continue to be used in capital expansion and any surplus funds, I guess, will be at the discretion of the board to pay out in dividends.
Okay, there's some additional questions regarding the e-commerce business case. What is the business case for the e-com platform? What is the investment level? They're commercially confident information. We have invested heavily in the platform. It's a new foray for the business. We have sought professional advice. It's an extremely competitive landscape in the online space. We do understand, and we do know the brand specific and corporately owned direct-to-consumer sites do have high success levels. Particularly when we consider the Toyota partnership, the Ford partnership, the brand exposure that we are getting in our organic channels to market and being able to market to those platforms, we do expect the platform to be a success. However, we'll be able to talk about that more after launch.
There was some questions also around the expanse of our retail business. We, we want to understand the success of ARB's Seattle store first to understand how quickly and where we will roll stores out. We are continuing to look at other short-term opportunities to expand our retail presence in the U.S. Again, we hope to be able to update investors on this progress at the AGM.
Okay. A question of return to margins, returning to historical levels. What we're seeing in Q1 2024 is that our margins have returned to those levels that we've experienced over the last couple of years, with sales price increases taking full effect against mitigating against recent inflation.
There's a question on the retail price of the ARB Earth Camper. The ARB Earth Camper retails for around AUD 75,000, fully optioned. The camper comes with a range of different options, showers, heaters, a number of other fitted items, with bolt-on two camper accessories. After the AUD 74,000 ticket price of the base unit, it tops out at around AUD 95,000. There's a question around timing of the Toyota Tacoma US partnership. That's not our business to talk to the launch timing of Toyota's programs, but please feel free to jump onto US automotive forums to look at that. Our understanding is that it will be within this financial year. There's a question online. We're just reading as we consider.
Could you please provide more details on your Australian store rollout program? How many per year, and what was the total network size that you see as possible? Again, commercially confident. We, we, we won't provide those details. We will say that we're, we're, we're not happy with the volume of stores that we've brought to market in the last financial year, and we're investing and have invested in the last 6 to 8 months in accelerating that program so that we can get more stores up and running, including independent stores. This is not just ARB investment, but this is also the independent network, who are very hungry, within the existing independent store network ownership, to expand the number of stores they have within their portfolio.
A question here to the backlog of orders compared with 12 months ago. Effectively, we've spoken to this over the last couple of years. Our order book continues to sit at the same level it has over the last 12 to 18 months, so we haven't made inroads into dropping that order book. It's currently sitting at about three times the level it was pre-COVID. We now have, as Lachlan described, we now have more fitters coming on board, and we have healthy orders coming through on a daily basis. In answer to the question, it's sitting at three times its pre-COVID level and the same level it was about 12 months ago. Question here on provisioning for stock obsolescence and warranties.
In the annual report, we, we disclosed the provision for warranties at AUD 1.2 million. That compares with, with no provision last year. We historically haven't carried a provision. No, there's no, no additional warranty, warranties being incurred or warranty expenses being incurred. We just thought it prudent to take up a provision on this occasion, which should carry forward year on year, and move only in line with the expenditures. Provision for obsolescence, ARB's always been historically conservative in many respects and continues to be so in relation to its inventories level, inventory levels and provisioning. The provision sits at about AUD 15 million against inventories of about AUD 230 million.
I'm just conscious of time and probably the last question that has been repeated a couple of times around the prospects for export sales increasing to positive growth in FY 2024. We've just been through an exercise. We've been through an exercise for goal setting and sales growth, and yes, at this time, we're confident of rebounding to growth in export business in the new financial year. Okay, I think we'll wrap it up there. That was. Just checking, is there any last questions, Simon? Look, there's a lot of questions coming through on the 4 Wheel Parts relationship, but it's really not our business to talk about the ownership of 4 Wheel Parts and Wheel Pros.
You can certainly research a lot of that information online. At least the analysts will have their access to, to information. We won't comment on the Wheel Pros business. That's not our, our place.
Question around UK goodwill impairments. The goodwill was impaired to AUD 13.4 million, an impairment loss of AUD 13.4 million in December 2022. We anticipate that that will be the extent of the goodwill impairments. We're tracking that business obviously on a daily and monthly basis, and at this stage, based on our projections, our cash, profit, and cash flow projections, we don't anticipate any further write-down in goodwill.
All right. Well, look, we'll wrap it up there. Thank you very much, everyone, for joining online. It's typically rainy here in Melbourne, for those of you outside of, of, outside of Melbourne. Again, thanks for joining today, and we look forward to talking to you again at the AGM. Thank you very much.