Welcome, everyone. My name's Rob McGavin, and I'm the current Chair of Cobram Estate. It's so lovely to see you all here, a massive crowd, something like 250 with another 100 odd online. I'm a bit sad they're not here as well, but maybe next year. It is always a very exciting day, and some parts of the day aren't so exciting, which is, to me, the formal part of the meeting, and also plowing the paddock and talking about last year's results, which everyone's seen and read in August and probably thought about to death. But of course, we need to cover those off, and we're more than happy for those people who need more further explanation to do so. This place looks absolutely amazing, and I need to thank a couple of people quickly.
There'll be more thank yous at the end, but a big thanks to Claudia and her team on site that have made this look so good. To Corbin, to Candice particularly, I know there was lots of others, and also from the sales and marketing team, Brent, Tom, and Zoran, and their teams. But all the work was actually done by Andrea and Alicia, so you can thank them. A little bit about today's. I better start by saying that the meeting is formally open. I'm told that we need five for a quorum, so I'm pretty reliably informed that there's at least five here, so we can get underway and declare the meeting officially open. It's actually, I think it's the 28th meeting since we first started and we first raised money this year, so I've stood up here a few times before. A bit about today's agenda.
First of all, I'll do my presentation, then Sam and Leandro will present their respective presentations. We'll then have the formal part of the meeting, and on each resolution, people can come up and ask questions, and then we'll go into general questions. Then there'll be some instructions, and you can go and do a site tour in groups with your correct colors that are on your name tag, but there'll be further instructions on that later. Then back here, and there's lunch behind. We hope you have a really wonderful day. Please bear in mind that, hopefully not, but the floor can be a bit slippery in the bottling line. There's moving machinery and other things, so just be careful. Joining us today at the front are our directors and senior executives, and both of those are directors.
But starting here is Sam Beaton, who probably doesn't need any introduction, but is Co-CEO, used to be the CFO, and he's based in Australia. Leandro Ravetti, who is also Co-CEO. He's now based in the U.S.A. He's Head of Technical. Craig Ball, who's based in Adelaide, is a Non-Executive Director and Chair of the Remuneration and Nomination Committee, and also sits on the Audit and Risk Committee. Toni Brendish, who chairs the Safety and Sustainability Committee, and also sits on the Remuneration and Nomination Committee and the Audit and Risk Committee. David Wills, who's. Sorry, Toni's from Sydney. David Wills is from Melbourne, who chairs the Audit and Risk Committee, sits on the Remuneration and Nomination Committee. I think that's it. Then Dr. Joanna McMillan, who's from Sydney, Non-Executive Director. She sits on the Safety and Sustainability Committee.
Daniel Masters, who is new to Cobram, who you'll be voting on today. He lives in Sydney now, but he spent 14 years in the U.S., and we will say a few more words about Dan, but we are very pleased to have Dan here. Also like to introduce Hasaka Martin, who is our company secretary, and he will oversee the voting and the questions in case we do anything wrong. Also, our auditor, Anneke du Toit, from Deloitte. David Holland from DLA Piper. Where is David? Yep. Good on you, David. Thank you for coming. CBA didn't turn up, which means they are very relaxed about our debt, I am assuming.
And we also have MUFG, who are our share registry, who used to be Link Market Services, who will make sure that all of the voting and bits and pieces goes well. If you have any questions, please reach out to them. A few things I just have to read out now about participating in the meeting. Obviously, with those online and in the room, it is a formal meeting, so I have been told I need to do it correctly. Thank you to those who have voted and already submitted questions. If you are participating in person today, you will have received an attendance card. If you have a yellow or blue card, you are entitled to vote and ask questions at today's meeting, and only yellow card holders are entitled to vote at the meeting.
Eligible in-person attendees may vote by using the reverse of their yellow paper card. For assistance, the MUFG Corporate Markets team at the registration desk will help you. In-person attendees with yellow or blue cards may ask a question at the appropriate time by approaching the mic. I think there is the one on each side. Where is the mic? Maybe we don't have a mic. We will get one. Oh, it is up. Yeah.
Anyway, those mics will be, go either side. If you can just say who you are and then ask your question, that would be fantastic. If you are participating online, you can use the electronic voting card, and if you require assistance, the online platform guide or call the number shown on the guide. Online participants can submit questions by registering as a shareholder or proxy holder and selecting Ask a Question. To submit a written question or comment, select General Business or the relevant resolution, enter the question, and click Submit. To ask verbal questions via web phone, select Go to Web Phone, enter your name, and click the green phone button. At the relevant item, press star 1 and mute your device's video, and by then you will be totally confused and probably forgotten your question.
The poll is now open and closes 5 minutes after the meeting, and I remind you to vote during the formal part of the meeting as well. Now to the chairman's address. The formal written address was released to the ASX this morning. You will be very relieved to know that I am not going to read it. I am going to try and highlight a few important points. It is there for everyone to read in due course. Today's meeting in total will be recorded, and it will be released to the ASX and put on our website. So you can re-look at what any of us said or any clarifications you may need. What I would firstly like to start with is say that it is 28 years since Paul Riordan and I, with a lot of help, started this business.
We were in our mid-20s, and some very, very trusting people gave us quite a lot of money, AUD 15 million between 1999 and 2000 to plant 500 hectares of groves. Those shareholders, I am proud to say, still hold a very big part of today's scrip. Many faces in this room I have been looking at for 28 years straight who always come to the AGM, and it is so lovely to see so many of you. We started with, when we listed just not that long ago in 2021, we had 850 shareholders. We have now got 5,100 shareholders. Paul and I were incredibly lucky to get so much support from so many shareholders and for that to continue.
We have certainly had some material issues along the way, at some times wondering how we are going to pay the bills, and other times, how do we keep the banks on side. There was probably a reasonable amount of up and down until about 2014 when we moved to the U.S.A. Then we really have cemented, and we have become increasingly stronger business since then. Obviously, we had a lot of terrifying moments, but there is no such thing as an overnight success. Really, it is 20 years, or sometimes there is overnight successes, but normally an overnight success takes 20 years, and maybe in our case it is 30, and maybe it might be 40. We are still going strong, and we are really excited about where the business is at.
2026 was a really transformational year for us, and being able to purchase COR after talking to them for the last at least 15 years about a merger in some way, a purchase on and off, the discussions went, and we could never get on the same page on valuation. I think the only reason that we are still here is that we have never overspent on assets. We have always been disciplined, always think about the long term. We do not really care so much about revenue. It is about profit. There are probably some things that just owners, founders do and have that make this business slightly different. Would love to think that those great attributes of founder-led sort of companies or founder-cultured companies can continue.
I think one of the big risks which we have been sort of reading a little bit and talking a little bit lately is how do we not sort of become the incumbent where you get relaxed and everyone just thinks, "Well, it will all happen, and we are the biggest and the best." I mean, you have always got to fight, and we always have to see everyone else as the opposition, and you have got to run this business like employees need to run it like they are spending their money, not shareholders' money.
Because if you get complacent, someone will take over. I would like to think that some of those hallmarks of how we started Cobram, some of the hard things that have happened, and some of the great people who have been with us since day dot, effectively day dot, Sam's not quite day dot, and others, and Craig Ball even, one of the first investors came to the first on-site meeting when there was nothing but a bit of wheat in a paddock saying, "We might plant some olives here," have kept us grounded. I think we had enough problems over the period to keep fairly grounded anyway. The thing that I think is really important to comprehend is probably how big the U.S.A. opportunity is and how important the purchase of California Olive Ranch is.
I will talk about a couple of the issues which pretty much came up at half year, and there was a lot of discussion afterwards. I will talk about those three things in detail in a minute. We are now the clear number one producer in Australia of Australian oil and branded seller of Australian oil, as well as in the U.S.A. we are. The reason it is really important is U.S.A. is to have leadership so that the industry stays on track with everything. Excellent value proposition to consumers, profitable growers. Everyone needs to win in the supply chain, and if someone is just cheating or fleecing or someone is not making money, it is not sustainable. I think that is what makes our business model so strong, is the focus on the consumer. When the consumer is happy, the growers can make money.
That all takes a lot of work, and I will talk about some of the things that we have done to help us get there. I will say a few words, because I do not want to look like I am not wanting to talk about what was an off-year and a lower profit year and a couple of surprises. The boys will take you through in detail, Sam particularly, on the FY 2026 results. Certainly, it was a reasonably pleasing year considering, one, the season, and we had a few variabilities. Just to put in context one of these things, olive oil accumulation in the fruit starts in end of January, early February, and continues on. You cannot do anything to increase it if you are doing everything right, because the weather drives that.
You can do lots of things to decrease it if you are doing everything wrong, and it will be worse because the weather is wrong as well. We know from our 20-odd years here doing this that the oil in the fruit can be 15% higher or 15% lower than average. We just had one of those years last year where it was 15% lower than average. If it had have been average, it would have been something like AUD 20 million-AUD 25 million more EBITDA. If it had have been on the top end, it would have been AUD 40 million-AUD 50 million more EBITDA.
Even if someone told Leandro Ravetti now, "You're going to have 50 billion fruit on the trees next year, and they're going to weigh one gram each," we still wouldn't know that there's going to be 30% difference between the top and the bottom just based on oil accumulation. We always go on averages, and that all went against us last year. At the time, when it was already an off-year, and integrating a business, and the team had been working really hard on everything to do with buying COR, negotiating it, and all the other things, meant that it was a pleasing year, even though when you look at the results, you mightn't think it was as pleasing as what shareholders wanted.
Certainly, solid demand for the products with holding our revenue, increasing it in Cobram Estate, not discounting like the importers were, trying to take back market share. If you think back a couple of years, there was a big shortage of olive oil. There was a lot of out-of-stocks. We took a lot of market share, and then last year, and the year before, there was actually a lot of oil came on. The price dropped a lot, and there was a lot of fighting. Even now, we're not fighting in the market. We're competing. We're not fighting in the market. We've got consumers who buy our product. We didn't take the price rises as much as what the importers did. Even now, we're selling the oil we've got, so why discount more?
We just want to sell the oil that we produce in an orderly manner for as much as we can get for it, but not ripping anyone off, of course. The importers' model is they don't grow it, they buy it, so then what they buy it for, and then they're either fighting for market share or not. That goes up and down. Yes, there's headwinds and tailwinds based on what's happened, and we've got a few headwinds at the moment. But really, really pleased with how loyal Cobram Estate customers are and how much they know that it's the quality that drives the value to consumers. Group package sales increased by 16.8% compared to 2025, but to be honest, a lot of that was the last three months of COR, having bought COR.
We had a normalized EBITDA for 2026 of AUD 61.4 million, and our total asset value increased to AUD 1.4 billion. A lot of our assets are still immature and improving yield, so we should see, because costs aren't incrementally proportional to yield increases, because the cost of running a grove is reasonably fixed, and when a young grove matures, yes, you spend a little bit more, but you get a lot more margin and cash flow. So, we should see all of that continue and improve as we move forward. Just since year-end, that's all I'm saying really on last year, but since year-end, we're in the middle of harvest. We're not quite in the U.S.A. Leandro Ravetti's come over for a few days. We've done 17% of the harvest in the U.S.A. It's obviously a lot bigger one because of having bought COR.
Everything is in line with expectations, which is really pleasing. The Australian flowering, Leandro Ravetti has just been up all around the groves. Ruth has given a presentation this morning, who manages the site, and there is no doubt that flowering looks as we would expect, which is terrific. Not early, not late. It is good as well. It is how we want it, and it is a big driver of obviously our profit. Changing topics slightly, I think a few considerations, and I have touched on some a little bit, but I will touch on them a little bit more.
The COR acquisition really has unlocked a lot of potential for us with the size we have in that market, with how much we can promote Californian growing because we have such a big percentage of it, how much we can work with other growers to improve their yields, get higher quality, reduce the cost, in a market that is massive. It is 8 times bigger than Australia. Their consumption per head is half, per capita is half ours. Only 2.6% of their consumption is grown domestically. If you compare that to Australia, we were like they were 10 years ago with consumption per head, and we grew. Year before, they were a lot less 10 years ago, and 20 years ago. We are just a similar evolution of per capita consumption increasing.
There is no doubt that there is huge potential there when you think that we have been able to get half of the retail market here approximately, and I am not saying we get half in the U.S., but a market being 8 times bigger when they get to our level of consumption, which I am sure they will, that is 16 times bigger than Australia. So, very exciting opportunity. Probably difficult when we did not own COR to a certain extent, because COR did not want to promote the category because we had a third of the category, and they would be promoting us. We did not want to promote the category because their brand was called California Olive Ranch, so everyone had gone and buy that.
So no one really did it, and there has been a bit of a standoff, which we are reversing, and it is the easiest marketing you ever do, is push a category. People believe a category. When you spend AUD 1, you get a lot more amplification because people are happy to talk about it. When you have got a brand, no one wants to talk about it and say it is good, really, unless you give them a check. So, it is a good way to convince people because it is more genuine, and you can control the industry better as far as quality because, and California does this super well, is that everyone's oil cannot be sold retail unless it meets certain quality parameters, which is really terrific.
Probably the great thing about COR is that their cost of production was way too high, and to us, that is sort of the easy thing to rectify, and I will touch a bit on how. But I think that having the sales and us now having access to the groves and the growers to get cost of production down in that area and others means that profit increase is just inevitable. I am not saying it is easy, but it is not difficult. That is a bit of an oxymoron. But the way to do it is very well known by this business, and obviously headed up by Leandro Ravetti. In Australia, we do not want to just think that you would think that Australia is not an important part of our business. It absolutely is. We have got a really strong footprint here, fantastic customer support.
So many consumers now realize that you can cook with extra virgin olive oil. It is actually safer than cooking with other products. It is the minor components and the freshness and the antioxidants which drive the health benefits, and that you should have three tablespoons a day. And that is really helping us, and it almost does not matter what the competition does, particularly in Cobram Estate, because it is better known and a slightly higher quality. It is just incredible. So, as our production increases here with so many young groves, and you can see in the presentations how much more growth is to come, we will be able to really grow our position here, and I think that you will see that through stronger profits and cash flows going forward. The earnings are expected to be materially higher in 2027.
One, it is a on-year, and we have maturing groves here in Australia, and in the U.S., obviously, we have got COR combined with our existing business, and our existing business was firing as well. So, I think everyone will be pleasantly surprised with how Cobram Estate does go, and there is no doubt that our two-year rolling EBITDA on and off years should continue to increase over time. I thought, as a shareholder, you have got so many companies you can invest in, why us?
Everyone stands up like me saying they are the best company and the best industry with the best people, and I probably just wanted to try and distill down a few things that I think makes us a bit different, and hopefully I am preaching to the converted. But over the last 26 years, the development of Oliv.iQ, which, in effect, it is a whole system from right through the supply chain and the growing, particularly in the milling, that allows us to produce higher quality oil at a lower cost of production. So, sort of think more fruit on the tree more consistently, more oil accumulation in that fruit, and then being able to extract a lot more oil out of that fruit of a high quality. And because the value in extra virgin is in the quality, that is a really, really great place to be.
And just a few stats. There is something like, we produce 9 times more olive oil per acre or per hectare than the global average, but incredibly, 60% more than the top 6% of individual producing groves in the world. Just think about that. The top 6% of groves in the world and 60% more olive oil production than their average. And that gives us huge advantages with everything from, I think we used per liter of olive oil produced, 37% less water, 61% less nitrogen, and 83% less phosphorus per liter of olive oil produced. So, the sustainability, less resources. We are getting more per hectare, but we could produce so much per hectare when you divide the inputs through it. It is good.
We are the most awarded extra virgin olive oil, or definitely one of, in the world, with over 700 awards, 200 gold medals, 50 trophies, and twice won the Healthiest Olive Oil in the World Award in Spain. We are a net carbon sink, and we do have enhanced biodiversity and work on all of that and try and have zero waste. Leandro will touch on that as well. We also have, through sort of good luck, strong industry tailwinds. It is very hard to swim against the tide, and there is no doubt that globally, consumers are looking for less processed foods that are more nutrient-dense. In our category particularly, every day, there is another article that says that refined seed oils create all these polar compounds that are bad for you, and you should limit your consumption, all those things.
So, we are really lucky with that, and we are really lucky that we can produce a high-quality oil at a lower cost because we are able to make more margin, if that makes sense, because it is just the model that we had to develop to survive in the early days, because everyone thought you need to buy European oils. Paul and I in those days, and maybe a couple of others, Tim Smith, were out there trying to compete with these Europeans saying, "But it is good quality," and everyone is like, "No, but this extra light and pure, it is the best stuff."
There is so much confusion in this category, and there has been so much adulteration and cheating, and that everyone effectively, not everyone, but so many importers just mine consumers' trust, fleece them, and that is why we have this great position, because if they were doing a great job, we would not be able to build our business. So, it is a negative to Australia, it is a positive to us. The other thing that I think, and most CEOs would, oh, sorry, Chair, I have just given myself the CEO title. Most Chair would say this, "You have got fantastic people." We really do, and execution matters.
Everyone has got a good idea, but not everyone can execute, and I think that that probably sets us apart a bit, is being able to execute on things. Do we get everything right? Of course we do not. But, do we get more right than wrong? Yes. Do we learn from our mistakes and revise? Yes. Do we hold everyone accountable? I would say yes. So, Leandro and Claudia and their teams have published more than 30 peer-reviewed research projects since inception, solving problems for us, particularly around how do we produce high-quality oil at a lower cost. That is pretty unique for a private company. It is usually public companies, universities that do research. We have done many, many, many more that have never been published because we do not want others to know the secrets. I am assuming that is why. A singular focus.
It sounds pretty simple, but knowledge and understanding seriously matter. We do not want to be that company, said this before, but we just do not want to be that company who has read the first chapter of every book and grow 15 different crops and have all these add-on products and everything. We just want to have written the book on olive oil and focus on that and just make sure no one can be better than us in any way. I think that being that singular focus of all the other distractions, and we could do so many other things and manage other crops and do other things, but we just do not, and I think that is a really important part of why we are successful.
Strong brands are just really good, particularly when they are in a domestic market, because you do not have to worry about currency risk and logistics. We probably were not too worried about that until COVID. It certainly gives you more consistent pricing, more pricing power, more relationship with the consumer to communicate, and certainly some inflation protection. We are going to who knows what sort of inflation re-period, but having tangible assets and strong brands with pricing power are two things that can really help protect your money in these periods. A lot of barriers to entry. It is a long time. You plant a vineyard for your children and an olive grove for your grandchildren. From when you start getting the tree to 18 months old and preparing the site, and you have blown a couple of years, you then another eight years till it matures.
Someone needs to spend a lot of money, and there is a lot of money around, so that is not a problem, but they have to wait a long, long time, and then they got to work out how to do it. Even with California Olive Ranch, they were set up by someone who designed the super high-density system or in the olive industry effectively, or they were in a big nursery growers, great operation. Their yields in California in the new groves were not quite a third of ours, but not much better. Just to give you a handle on people who are doing it properly, spending money, modern technology, everything, still cannot do it. That is important, and that is something that is very unique about our business.
The other thing that is, I suppose, one of our strengths. Might have even skipped a page in the middle of my ramble. No. In the U.S., we are now in 40,000-odd stores, and obviously we are in nearly all the stores here in Australia. We got AUD 1.26 billion worth of tangible assets, principally farmland in Australia and California. That important piece I mentioned before of selling what we produce in the market we produce it in is definitely an advantage. I will go to the, sorry, I think I have mixed a few of my pages up. No, I have not. Bear with me. On the COR acquisition, and obviously we have got to be a bit careful with what we say because there is a lawsuit going on. We do not want to prejudice anything.
We love to be open. We love to talk about as much as we can. But of course, if it is risk putting the company in a poorer position, we are better off not saying it until after we can. In saying all of that, there is not really any secrets. But the missed earnings was, we got a lot of phone calls when there was no earn-out payment to COR when we purchased it. For those that are wondering if I am speaking double Dutch, effectively, we sort of agreed on price with COR, and then they said, "Oh, but if we earn this amount, we want you to pay us more."
There was this limited earn-out, whereas if they earned over, I think it was AUD 7.5 million for the half in EBITDA while we sort of had it, or in that six months where we only had it for half to the 30th of June, that we paid them extra money. They did not hit the earn-out, and we did not pay them extra money.
There was quite a lot of, "Oh, you must have bought a dud business." But honestly, the reverse is true. I did not want to pay the earn-out because it would have only been good luck. Their costs were too high. It is long-term business. We have now got that money in our bank, and we know how to get the earnings anyway, because it is just cost. It is just taking the cost out and getting production up, cost reduction per liter. Honestly, if they had have hit it, they deserved it is fine. They did not, and they did not get it. Nothing changes our view on the business because they did not hit an earn-out. The other thing was onerous leases.
We wrote off AUD 34 million in our accounts at the 30th of June, on effectively leases that are out of the money. But we knew that. We had done all the due diligence. We knew the leases. We knew the properties. There was no secrets in anything that was given to us. Effectively, our strategy is, and still is, that we are negotiating with the people who leases those groves, which represents about 25% of our production. If we can renegotiate the leases, it is a win-win for both, which we are confident we can. We will extend them, which you can under the agreement, which I think is a win-win for both parties. If we cannot, we will just milk them and let them expire. There is so much more production coming through from others.
It was something we were fully aware of when we bought the business, and it was not a surprise. Certainly, the price we paid for the business, we knew about that in our whole negotiation. I do not want to just be up here gilding a lily that everything is fine, but that was absolutely fine. The other probably more serious issue to shareholders that we got questioned about a lot is the purchase price adjustment. If I give a tiny bit, this is what we are in court about at the moment. If I give you a little bit of background, we both had around a third of the U.S.A. production and were fierce competitors in the market.
They were super sensitive with what information they'd give us, particularly around stock levels and sales strategies and discounts and those sorts of things, because until after we'd paid for it. We totally respect that. We would have probably been the same. We couldn't delve in and look. We had to effectively take their word for what the stock levels were. But in the agreement, we were protected, and we turned up and settled, and in the agreement, there was an adjustment to that based on what they actually were. That's where we got to a situation where we sent them in a bill under the agreements, or an invoice, for the USD 32 million for bulk oil that was in excess of six months' demand, which was clearly articulated in the agreements.
They don't want to pay it, and so we're in court fighting over it. If we lose, we've got a few legal costs, but we don't have to write out a check. We're really confident of our position, and we're not being stupid about this. But we're not trying to rush it either. The more you try and rush something, the worse the deal gets, and we're just getting on with doing it. It's not impacting us at all, apart from a few meetings and a few legal bills. I just wanted to, I suppose, articulate that. The other thing that we've had a few questions about is our debt position has gone up quite a bit.
I'd like to remind everyone that we spent AUD 250 million in the last three years principally on groves and just related infrastructure for production, which are all maturing and coming on. So, increase in value, increase in profit, increase in revenue, all those things. We also purchased COR with debt and equity, and our LVR went from 33% to 36%. I reckon that shows sort of the strength of the business, and it's certainly not something that keeps me awake at night. Trust me, in the early years, I've been kept awake at night by debt. We have a very good business. We're strong cash flows and increasing groves. So, personally, we're not worried about it. We've got a lot of tangible assets. We've still got over AUD 800 million tangible assets after our debt is taken off, effectively.
A couple of things on the industry that I'll touch on reasonably quickly. Again, I've been talking about this for 20 years, but after developing an Australian standard for olive oil for consumer protection and for a bit more level playing field, which Leandro authored and won a prize for, because Standards Australia are the only ones in Australia who are allowed to do any standard, it's still voluntary, which means we are the only ones who comply with it. The government, with the Minister for Competition and the state ministers, four of the states at their COAG meetings can say, "Let's mandate the standard," at any one of their six monthly meetings, but they decide not to because, "Oh, well, someone who ports olive oil, who's an Australian from Europe, he doesn't want to mandate it." Well, hello, of course he doesn't. It's just frustrating.
But again, we are still agitating. The U.S.A., we are working with them as well around improving standards. These things take a long time. Who knows? It is not, we are getting on with it. It is just a frustration I thought I would get off my chest. The other one is the Health Star Rating system. They are looking at mandating that. It is just a complete disaster, to be honest. What started out as something that is a great idea has just been overtaken by big food producers. I will quote a guy here who was a former FSANZ, which is Food Standards Australia New Zealand, who are the ones who will decide if they mandate it.
He is a former board member, Professor Mark Lawrence, and he recently said on "Four Corners" that the Health Star Rating system has become a marketing tool for the ultra-processed food manufacturers because its algorithm is easily gamed to make products appear healthier than they are. We have seen that so many times. The issue for olive oil is that genetically modified canola, which has been refined with heat and chemicals and solvents, because it only measures saturated fat in our category, because calories are all the same. It is the only thing is saturated fat. We have got slightly more saturated fat naturally than genetically modified canola, so canola can get four stars in some, and we get three and a half. It is ridiculous. It does not take in any of the antioxidants, any of the processing, any of the natural things. They just should take it out.
It is just misleading, but they just will not. It is like, "Oh, no, we cannot do that, and we cannot do this." We have been fighting that a fair bit. The sad bit is that consumers seriously, and I have been to every one of these meetings, I think, well, at least from 2012 when they started this till 2021, where big food companies stand up the front who have written all the algorithm and explain how it all works. It is that simple that if you can replace sugar with artificial sugar, you get more stars. If you can replace anything with nutrition with sawdust, well, you get more stars. In some little areas, it is probably good, and I am not an expert on it, but in this area, it is a complete disgrace. It is another example of our government getting involved and just completely cock it up.
The second one is probably water, and I have been banging on this for 30 years too, but I got to get it off my chest once more. We are just the biggest bunch of fools in this country. We just let all of that water that is in government storages that feeds the nation and people use it for consumptive use. One, there is 40% gone that is to the environment. Okay, that is fine. That is a decision. That is not arguing. It is what it is. It is between state and federal. The feds have bought about 30%. They have not rescinded it to the environment. They have kept it in the storages, which means that the biggest dam, Dartmouth, might as well have silted up from a pure producing food point of view. That is fine.
They've said, "Okay, anyone can own water." You say, "Okay." They can own the temporary water too, which is what they allocate out of the storages each year. When the storages are half full and the bureau says there's going to be an El Niño, all the traders and international funds and hedge funds all jump in and buy it against farmers who's trying to feed cows or grow olives or do anything. We're impacted by cash flow, but we got a great business with strong consumer brands. Lots of people just don't have confidence to invest in their business. It's pushing water to lower value use, which is exactly the reverse of what was intended, because it's too risky to develop an export market, put in permanent crops, have a processing plant when you can't afford water.
I'm talking big money, like huge money. I mean, 50% of your operating costs can be water in a bad drought. I think it's simple, but no one will do it. We just need to say that the consumptive water that's left, which is the 30%, is open to industry, townships, and productive users, farmers, irrigators, and whoever's got the best business, whether there's 10% allocation on that or 100, compete with each other for it. When you're dealing with someone who not only has the carryover rights to take it into next year and doesn't even put it on the market, and they've got really deep funds and they're in another country, we're just so foolish. California has the reverse.
Between the water policy, the crippling tax increases that we're seeing, and here at this site, I think in 2019, we paid AUD 18,000 land tax, and this year was 220 something. Yeah. I think over 200. Do you know, Anabel? It doesn't matter. We got no more land, no more buildings. We're just here, and you just amplify that in everything. Everyone knows if you live in Victoria. Also, just the bureaucracy mean that we're not We love Australia. We're always going to be here. It's a focus, got a lot of groves, and we think it'll be reversed. At the moment, we're just spending money in California for a number of reasons, but just they are pro-business and pro doing things, and it's quite refreshing.
Love to thank all of our great people who are here, the executives, their teams, the ones in the States who are maybe online. We've made some recent appointments. There's been a lot of disruption over there with changing staff and merging two businesses, and the boys have done a terrific job, and the team's over there, and everyone that's with us. We're really pleased to be able to be one and move on with it. I'd love to acknowledge Sam and Leandro for the work that they do and have done, and Leandro's special effort in leaving Australia and moving to the U.S.A. to bed that business down. Not everyone would do that, and I think on behalf of shareholders, we're very, very grateful for that. Also, the directors, their guidance, their strict instructions to keep me in line. All of our suppliers and customers.
Everyone that works with us, we wouldn't have this business if it wasn't for people. It's all very well to have a nice building or a big building, but you need the people who are doers, and you need the customers, and you need the care. I think that is what sets us apart, and it is what's important. Shareholders, I've touched on you a few times, but wouldn't be here if it wasn't for shareholders, particularly in the early days when they trusted us so much to build this business. I feel, again, I shouldn't probably say this, but I will, we wouldn't have raised that money in those days if it wasn't for super funds. Now, super funds are not looking like very good Private super funds, I'm talking about, not industry funds.
Mom and dad, high-net-worth super fund, the money's in there, you can't spend it on your house or something else, so they'll give it to someone like Paul and I to invest it long-term with a long-term thinking. When they don't They're not as inclined to give you much money if it's coming out of their own pocket, and they think, "Oh, we got school fees, and we got this." So, the changes there that are making it more difficult to invest and limiting sizes and whatever, I think will really impact future businesses being built in Australia like Cobram, because it's hard to raise money. When you've got a startup, it's nearly impossible. So, I might hand over to the boys, and yeah, thanks very much.
I'll come back for the formal part of the meeting, and we'll leave all the questions to the end, if that's okay.
Thank you very much, Rob. That was a great speech, and always a hard act to follow. Welcome to everyone for joining us here, and thanks for joining us here, and welcome everyone online. I'm going to take you through a very quick overview of the FY 2026 financial results. I'll give you a commercial update, and I'll give you a few comments on outlook. Of course, we'll have plenty of time for questions at the end. This year was actually a pleasing year for the company, where we reported our two-year rolling normalized EBITDA of AUD 90.9 million, which was up 0.3% on the prior period. From a sales perspective, packaged goods sales were up 16.8% to AUD 253 million. During the year, as you know, we strengthened our balance sheet, and we raised AUD 178 million in September 2025.
From a CapEx perspective, the Australian business has returned to sustaining CapEx levels, and our growth CapEx is focused on the U.S.A., where we plan on planting 840 hectares this year and another 420 hectares in the year to come. Leandro will talk more around that. From the first quarter of FY 2027, we have seen strong sales levels in both Australia and in the U.S.A., and it is really highlighted to us the importance of having premium brands and the demand from consumers for high-quality, locally produced extra virgin olive oil. From a detailed profit and loss perspective, we think about our business in two business units, the Australian business and the U.S.A. business. The Australian olive oil business, our EBITDA dropped to AUD 52.1 million. This was expected because Australia was an off-cropping year, and we also saw an increased cost in production, particularly around temporary water.
The U.S.A. olive oil business saw an increase in EBITDA to AUD 9.4 million. Just to highlight to everyone that that did include three months' earnings from the California Olive Ranch business. There were quite a few abnormal items that went through our profit and loss this year, which no doubt made it difficult to understand. I just want to talk briefly about a couple of those. The water expense of AUD 41.8 million. As part of the COR acquisition funding, we issued notes or debt, and attached to that debt were warrants. There are 30.8 million warrants on issue. They are five-year warrants, payable at the end of the period. There is only a payout on those warrants if the share value is over and above AUD 3.20 at the end of the period.
For example, at the end of the five years, if the share value is AUD 4.20, then those warrants would be worth AUD 1 multiplied by the 30.8 million warrants. But under accounting standards, every six months, we are required to use a theoretical valuation model to value those warrants, and the movement in the value of those warrants is taken through our profit and loss. We will show it as a separate line item each reporting period, just to make it clear to investors. We also spent AUD 4.8 million on transaction costs relating to the COR acquisition that went through our profit and loss. There is a positive tax expense item, which does look unusual, AUD 33 million. That relates to carry-forward tax losses that we had in the U.S.A. that we had not recognized as an asset previously.
Post-acquisition of California Olive Ranch, we assessed the profitability of the business going forward, and we now deem that we will be able to use those carry-forward tax losses to offset our future tax gains. That is recognized as an asset, and the other side goes through as a positive tax expense. Cash flow in the business, our cash flow from operations was actually down to AUD 47.5 million. I will talk more in the next slide about the reasons behind that drop. During the year, we continued to invest significantly on growth projects, AUD 101 million, predominantly in the U.S.A. We also, of course, purchased the California Olive Ranch business, which for cash consideration of AUD 159 million. To fund the acquisition and the growth CapEx, we raised both equity, and we increased our debt levels.
At 30 June 2026, we had cash and unused debt facilities of AUD 115 million. This chart shows our operating cash flow over the last five years. As you can see, a disappointing year this year. I just want to highlight that the majority of the decrease related to our investment in working capital. We purchased more bulk olive oil from third parties than the prior year, both in Australia and in the U.S., AUD 6 million in Australia and AUD 10.6 million in the U.S. The cost of temporary water meant that the cost of olive oil in Australia was higher. We also had some permanent differences as well in relation to bulk oil. Our non-extra virgin oil we sell in bulk, and it is more closely linked to commodity pricing. We got a lower price and slightly lower volume we sold.
We also had AUD 5.7 million of non-recurring operating cash flow expenses relating to the COR acquisition and associated restructuring costs. Our balance sheet, our net assets of AUD 517 million at the end of June, AUD 1.2 billion of assets. Just a couple of call-outs on our balance sheet. Our trees and irrigation infrastructure are recorded at written-down cost, not at valuation. Our brands also recorded at cost, and not revalued at each balance date. Also, that deferred tax liability, that relates to historical, of AUD 66 million, that relates to historical accounting write-ups of asset values and would only ever be triggered if we sold the assets outside of the group. At 30 June, our debt ratio of 35.6%.
For my real tangible assets against borrowings, so this backs out our intangibles. The bar chart on the left is 30 June 2026. As you can see, AUD 1.26 million of real tangible assets, taking into account the external valuation portion that is not on our balance sheet, against net debt of AUD 437 million. Moving on to sales, well over 90% of our sales are now in packaged goods in both countries. This is the Australian sales in packaged goods, showing Cobram in purple, then Red Island and private label. As you can see, a modest increase in sales during the period to AUD 165.7 million, and Cobram reporting growth of 2.1%.
This was pleasing for us on the backdrop of a category that dropped in value for the 12 months, was down actually 2.6%, but increased in volume by 10%. The heavy discounting from our imported competitors really drove the drop in sales value.
In the U.S., again, this is just packaged goods sales. Packaged goods sales for the full 12 months of 87.5%, 82% growth in branded sales. This was driven by the three-month contribution from the California Olive Ranch brands. Again, similar to Australia, we saw the category drop in value terms, so dropped by 5.4%, but in volume terms, actually increased by 3.9%. If you look at the Californian category as a whole, it actually increased by 4.9% for the 12 months. In terms of business outlook, the Australian packaged goods sales, we expect that to be broadly in line with last year for FY 2027. Our extra virgin olive oil supply remains tight, and we are forecasting to start bottling new season oil during the 2027 harvest period.
In the U.S.A., we will see a significant increase in sales, as we will have the full year of California Olive Ranch packaged goods sales, and certainly that will be supported by a larger Californian crop. For the first three months of FY 2027, pleasingly, in both Australia and the U.S.A., we are tracking in line with our budget. From a full-year perspective on an earnings basis, we expect EBITDA to be materially higher than FY 2026, and there is a couple of factors driving that. Firstly, the Australian on-crop this year, and secondly, we will see a full 12 months of California Olive Ranch, the U.S. business's earnings, and the realization of the synergies of combining the two businesses in the U.S.A. Rob touched on our debt levels.
You will see from Leandro's slide, the maturity level of our trees and what we are expecting in the coming years, and that is really going to drive our increased both operating cash flow, free cash flow, and earnings. As a result, we would expect to see, or we are forecasting our debt levels, both in dollar terms and in percentage terms, to come down over the medium term. We are really excited by both the Australian and the U.S.A. businesses, both in the medium term and long term. I am sure you will agree with me once you have listened to Leandro. I would like to thank all our employees, both in Australia and in the U.S.A., the terrific support from the executives that are all sitting in the front row here and online in the U.S.A. There has been some extraordinary efforts this year.
I think the acquisition of a business the size of California Olive Ranch and then integrating it as well is a huge effort, and there has been some extraordinary efforts by a lot of people within the business. I think what Leandro and I are most proud of is, though, that no one has lost focus on the underlying business. It is a big business to run, but to continue to run that as well as a big acquisition and integration is a credit to all of our employees. Just very quickly before I hand to Leandro, we announced a dividend as part of our year-end results. That dividend will be paid next Friday on the 6th of November. From a DRP perspective, a Dividend Reinvestment Plan, we had 19.5% of shares participate in the DRP.
We will have question time at the end, but I would like to hand over to Leandro.
Good morning, everyone, and thank you for, I think I have broken something. Thank you for being with us today, both here and online. I was just checking the size of the font on the page, and it seems to be growing for every year that I have been coming to one of the AGMs. Getting pretty large now to be able to read it. Following Sam's presentation, I am going to do what I normally do, just provide a brief update on operations and really taking you through some of the main actions that we have followed to grow our pillars, particularly in terms of growing CapEx deployment in the U.S. Many of the things that I am going to share largely going to reinforce a lot of the messages that were in Rob's presentation. I thank you, Rob, for your kind words in the presentation.
Definitely going to the U.S. was not a sacrifice. It is a privilege. Great to work with an amazing group of people and being part of such a transformational transaction. So, I thank you and the board for the trust on us to be able to do it. Sorry, I get It is not emotion. It is just-
He needs some olive oil.
As I was thinking what to say or how to present it today, because there was so much to say, I just wanted to make sure that we did not get bogged too much down into the numbers, the tons, the percentages, the hectares, and just really focus more on the amazing short, medium, and long-term future, and particularly taking you through the assets and the brands that we developed and we have to be able to execute on that future. I think that we all probably agree that the world had became increasingly focused on short term, especially the investment world. And we are probably proudly still a long-term company.
I think that the value that the company have added to shareholders from the very beginning, from those very humble beginnings, and the growth that we are still expecting to add is because we have a long-term vision, because we have been very disciplined with our investment, and because we have had the commitment to follow through. Touching very briefly on the harvest just passed in Australia, as we have said, it has been actually a record off-year for us. It was the highest amount of oil produced for us in an off-year, 11.1 million liters of oil, which is 10% higher than the previous off-year. Rob referred to the fruit and the oil content.
If we are actually looking at just the fruit, not considering the oil, the production was only 7% lower than the previous on-year, which is a great achievement and a clear indication of that growing path of the supply in Australia that we continue to talk about. In terms of water, it was mentioned as well, the price of water today is still above long-term average, trending down mainly because of the above-average rainfall in the last part of winter and early spring. That higher than above rainfall levels have led also to significant permanent savings in terms of the water usage in the year today, so from between July and October. Yes, I am going to try to cover probably one of the big questions, how the crop is looking in Australia.
As soon as I got back from the U.S., jumped in the car, went up to the groves, checking on the trees there. It is almost like visiting your almost teenager, grown-up kids. I say, "Oh, great to see you again." They were looking good. Rob touched on this. One of the main things that we normally look at and we always comment on is the timing of flowering. Having had the flowering at Boundary Bend just finishing late last week, the peak of it, and the one from Boort happening early next week, it places right on long-term average. Long-term average is good because it shows that the conditions during winter and spring have been relatively normal, and trees like normality.
Everything that we have seen, still a long way to go with assessments and fruit set and everything else that can happen, but it continues to support our view that the crop next year, it is going to be definitely substantially and materially larger than the crop of the year before, but also larger than the previous on-year. This is obviously largely due to the maturing profile of the trees, but also the good condition of those trees. If we move to California, the harvest over there started on the 12th of October in one of our mills, and the following week in the mill of the north. It is progressing quite well. The weather has been quite nice so far. Approximately, we have milled just shy of 20% of the fruit today, with yields, quality, and efficiency is perfectly in line with our expectations.
Now that we're touching in California, or particularly because we are there, I really would like to also sincerely thank the U.S. team, which many of them hopefully are following us online today, for the work done through the integration. I think they have shown an incredible amount of professionalism, resilience, because the integration process are never easy, and also passion, and that have helped me a lot to get the job done. I think that I'm really proud of how far we came in just short seven months. It doesn't seem long, but it has been a good enough period to make significant progress. Also, we have recently appointed a new Chief Financial Officer and a new Chief Commercial Officer that only helps to add experience and depth to an excellent team that will help us to execute the growth ahead of us.
On that integration also, I would like to thank a lot of executives from Australia, Brent, Kate, Claudia, Rory, Ian, Anabel, that have spent a lot of time in the U.S. over there, giving us a hand and helping with an integration process that was hugely valuable. I want to add also Shannon and Raj in other areas of the business on safety and quality too. Definitely thank Sam. The amount of work, I know it, we know it, the amount of work that went behind getting the transaction, his team and him personally, middle of the holidays, Christmas, it didn't matter, and all the work after that. I don't think that we could have done it, definitely not in the time that we did, without your help.
Moving to the next one, talking about the integration of the team and of the California Olive Ranch business and how that's going. I think it's progressing incredibly well. It's never an easy process, but the hardest yards have been sort of already done. With the acquisition, as a reminder, we included two brilliant brands, like California Olive Ranch and Lucini, just shy of 1,700 hectares of leased and owned groves, more than 2,500 hectares of third-party growers, a large operating mill, bottling line, and warehouses that help to cement that growth. Particularly when we talk about the synergies that we wanted to bring into the business short term, over the first quarter of a year, and we put a figure on around $ 12 million for that first year.
All those synergies are well on track to be realized by the end of this financial year, largely on the back of the consolidation of the workforce, obviously deploying our knowledge across the growth of the trees in the U.S., and the implementation of a lot of other practices, as well as optimizing the use of the milling capabilities, the warehousing capabilities, and so on. Still, the second phase of the synergies that will take us to an aggregate of about $ 20 million, and hopefully a bit more, are going to be largely realized over the next 2- 3 years once those groves reach a higher level of production, and naturally, that leads to a lower cost of production. I think that these slides captures the business that we now have following the acquisition of California Olive Ranch.
I think when you see the geographical reach that we have, the area planted, the strength of the brands that we have, there is no doubt, or it is easy to understand why Cobram Estate Olives became the largest fully vertically integrated olive oil company in the world. The great thing also is that there is still substantial growth embedded into the investment that was done. What we have today is amazing. There is plenty more to come. If we looked at the assets, quickly I will take you through the quality of the assets that we have. in Australia, about 75% of our trees are mature, of the 7,000 hectares of planted trees.
That means that the mature area will still grow by 33%, and when we combine that with a return to more normal environmental conditions and some of the third-party fruit that we have on long-term contracts, the production, as an average, will jump from our current average levels to over 20- 21 million liters of oil. Significant improvement in oil availability, but also a significant reduction on the cost per liter on the back of that. Quickly, I will show you some photos of our groves for those that have not seen it, but I am sure you have done it. Amazing assets at both Boort, Boundary Bend, Wemen, three different locations. Our mill at Boort, world-class, one of the largest mills in the world. The mill at Boundary Bend, these facilities in Lara that you are going to see today.
I think they are not only really beautiful assets, probably the most important thing is that they are extremely difficult to replicate. It takes not only a lot of money, time, expertise, you have to find the right land, the right environment, and also getting increasingly more difficult to get the right permits to be able to do it. If we move to the U.S., this map of the Sacramento Valley shows the location of our groves. You have two clusters. There is a cluster just to the northwest of Sacramento. These are largely the groves planted by Cobram over the past few years and still being planted now around the Yolo County, and they are all surrounding in close proximity to that purple dot. That is our Woodland facility, our mill and warehousing, laboratory, and office is there.
Then you have another cluster of groves to the northern part of the Northern Sacramento Valley around the light blue dot, which is the Artois milling facility, bottling line, and so on. The great thing with this in Californian terms, but in world terms too, horticulturally, is that those two clusters represent two very different growing areas within California. They share different distinct climates. They have access to different district water. They have access also to different aquifers, and that actually helps to increase the resilience, in a sense, of the supply there, as well as reducing the horticultural risk. This graph shows also a bit of a significant change in the profile of our groves post-COR acquisition.
We have a cluster of groves that are actually quite mature, roughly 50% of the area that we have, and those groves have the opportunity to significantly increase the yields now that we are deploying the Oliv.iQ system to them. Then we have another cluster of largely younger groves, which represents the other 50%, many of which are yet to come into production, and the vast majority of them are immature. There is a significant amount of supply growth into that profile, either by the improving of the yields of the mature groves or by the coming into production of the younger trees.
When those trees come into production, when those mature groves improve on their yields, the current production levels of our own groves, which, if we only look at the Cobram groves last year, produced less than 1 million litres, the overall production of all our groves is going to get to over 11 million litres. This is not considering, not including any third-party oil. Last year, the third-party oil of the two companies combined were approximately 5 million litres. If you put on top of that, 11 plus 5 would be 16. Also, the growing area that we are contracting with third party is growing, which we should expect then that 16 million theory to go even higher than that, getting to a very similar level of production than what we are expecting in Australia.
Some images of the COR groves that you probably have not seen before, the California Olive Ranch, the Artois Ranch, really, really beautiful properties. Similar to Australia, also extremely difficult to replicate in the scale and the way that they look. These are some of the groves that we have planted, Hungry Hollow, the William Ranch.
Can you just talk about the pruning, like on those California Olive Ranches, just the fresh grove? Just because they look so good.
They look so good?
No, just around the. Just talk about what you've done to them since we've seen them.
Okay. Part of the work that, what Rob McGavin asked me is to talk a little bit more about some of the interventions that we have done in the groves that we bought from COR. Part of the work to be done was really focused on improving the way that water, fertilizer, and everything got delivered, but also to be able to rejuvenate the trees, applying techniques that actually include more severe and specific type of pruning, and that sort of leads the trees to look in the way that they are. Remembering that in the U.S., the majority of those groves are planted in what they call super high density system. That means that there's a lot more trees per hectare. In Australia, we have roughly between 350 and 400 trees per hectare, while the super high density is over 1,250- 1,500 trees per hectare.
The groves that we have in Australia and many of the groves that we are planting in the U.S. look like an almond orchard. Many of these super high density look a lot closer to a vineyard, just to picture the difference. And obviously, that requires some of that intervention to make the trees look a fair bit better. We also have images of the Artois mill, very similar in size and capacity to our Boort mill, and some images of our Woodland mill, very similar in capacity to our Boundary Bend mill. Almost identical from that point of view. We acquired two great brands in the form of California Olive Ranch and Lucini. California Olive Ranch was the number one brand of Californian American-produced oil in the USA, and Lucini, the number one premium imported brand.
When you looked at those three brands now combined, Lucini, California Olive Ranch, and Cobram Estate, they are all within the top 10 brands, not considering private labels. Number three, number eight, and number nine. When we combine all our brands together, we are the third-largest branded business in the U.S. Certainly an amazing platform from where to build the business that we are intending to do with the increasing amount of supply that we have. The structure of the brands or the early stages of the renewed brand strategy fundamentally place California Olive Ranch as our flagship brand, very similar to what we do with Cobram Estate here in Australia. The best oil goes into that brand. It represents all what you expect out of a premium locally produced olive oil. Cobram Estate will play in the U.S. a similar role to what Red Island does.
It's an entry point. It's trying to bring more consumers into that locally produced olive oil category, really setting up the benchmark for what the minimum standards of really good quality olive oil should be. Lucini will continue to talk to those consumers that value more the Italian heritage and the imported oil, yet of really high quality too. Fundamentally, what we're going to go to is to the basics, the things that have actually made us successful in Australia, which is linking and owning freshness as the new premium. Just linking and instructing and teaching, educating consumers, influencers, healthcare professionals about the importance and the relevance of freshness and why a fresher olive oil is actually a healthy olive oil, a better olive oil, a better-tasting olive oil, and obviously how that relates to the origin.
Some images of the promotion to get you an idea of the presence of some of the brands on the retail shelf. Now I'll take you briefly through the main CAPEX projects, especially related to plantings. At the moment in the U.S., combined what we have planted before, plus the groves that are long-term leased and owned by California Olive Ranch, we have approximately 3,000 hectares of olives planted, and we are finishing another 840 hectares right now. Some have been already planted the last two or three weeks. The remainder will be planted over the next 3-4 weeks.
By the end of this calendar year, we will have 3,840 hectares of planted olive groves in the U.S., and there's another 420 hectares to be planted in the next calendar year, bringing our total growing area in the U.S. to 4,260 hectares, which is just shy of 1,000 hectares more than our target when we raised capital a few months before this time last year. Some of the images of the trees planted during 2026 financial year, so we're about 360 hectares. I just would like to play this video, if we could play this video. This is one of the ranches that we planted last year. It's not AI. This is really the images of our farm. It's a beautiful farm. Overall, it's a 1,777-acre farm.
Part of the farm was planted last year, and another part of this farm is being planted now. I have another small short video to show you. These are some of the images of the areas that we are planting right now. It is three different locations, but they are all interconnected, forming a larger institutional-sized growing area in the U.S. More images of the land preparation. Trees are being planted, starting to get planted. Trees on the ground, which is happening already now. We can play again this short video of the property that is being planted. Beautiful on the foothills of the Californian range, Capay Valley Range it is called. All incredible properties, just like in Australia, extremely difficult to replicate. Thank you.
Part of the other capital project that have happened is actually the expansion of our Woodland facility. You have an image there of the entire site. It was 15 years ago, it was an old tractor dealership. It went a long way from the old John Deere days to where it sits now, with a lot of storage capacity, a lot of new warehousing capacity, additional office space, and the incremental capabilities in the lab to be able to overall cope with the additional production that is going to be happening over the coming years. Some images of the expansion of the mill on that side in Woodland. Some images of the warehousing and new tank farm. Also, another project that we are having in line is the implementation of a new expanded bottling line in the Artois site.
This new bottling line is a little bit larger than the bottling line that we are going to see here in Lara on the other side, taking our bottling capacity from a bit over 6,000 units an hour to over 16,500 bottles an hour, giving us a lot more capabilities, a lot more throughput, and fundamentally and most importantly, reducing our bottling costs and increasing the efficiencies of our production. Briefly touching on sustainability, obviously, we started this journey 25-plus years ago, formalized it with our sustainability plan, 2030 sustainability plan in FY 2024. You can read a lot more about this in detail in our voluntary sustainability report in the annual report. I am just going to take a few highlights.
The first one is that for third year in a row, despite the very active growth of the company, we continue to be better than carbon neutral, even when we consider all the Scope 1, 2 and 3 emissions, both in Australia and the U.S.A. Safety and quality. We managed to maintain all our food safety and quality accreditations across all sites with near perfect scoring. Also, put a lot of work and emphasis on improving our safety as much as possible. A lot of work on better inductions, a lot of work on preemptive reporting near misses, trying to be a lot more proactive in the way that we do things.
With the help of everyone through operations, that translated into significantly better numbers in terms of the Total Recordable Injury Frequency Rate, which is what you see in the bottom there, dropping from 21 to 18 to 6, and that is significantly better numbers than the industry average. Efficient use of resources, investing a lot more in irrigation, trying to get the water being used as efficiently as possible. Also worth highlighting that the past year, we have sold over 20 million kilograms of byproduct. That area of the business, that business-to-business sale of pomace, of pit, is growing, it is doing really well. Developed significantly in Australia, but also starting to generate some traction in the U.S. too. Put a lot of emphasis on the engagement with the communities that we operate. Healthcare professionals, big, big target. Obviously, Australia had been doing this for many, many years.
We launched our healthcare professional campaign in the U.S. in July last year, and since then, we have already managed to engage with over 67% of healthcare professionals in the nutritional area in the U.S., educating them about why extra virgin olive oil is so much better than any other fats and oils that you can have. We are also putting a lot of attention, particularly in the U.S., but also in Australia, engaging with our partner growers. Our grower partners are a hugely important piece in the company that we are building, helping us to continue to supply oil that will continue to supply branded growth without the need of ongoing intensity on capital deployment. Just to wrap up, I want to go back to the beginning, telling you a little bit more about the long-term vision and why we are so excited about the future of the company.
This graph here shows the evolution of the consumption over the past 35 years of the three main markets in the world. Spain in red, Italy in green, and the United States in blue. While Italy is slightly declining and Spain roughly stabilized, the U.S. is showing a clear, consistent growth. This is not a short-term trend. For over three decades, the consumption of olive oil in the U.S. has been growing at more than 4.5% year- on- year. There is no doubt that within a couple of years, the United States will be clearly becoming the largest market for olive oil in the world. Just to give you an idea of the size, that 4.5% growth in consumption in the United States every year is more than the entire production of California last year.
The overall market grows every year more than the entire production of the local industry, so great opportunities there. These other slides, what they show is the strong link between local production and consumption. We have two examples. Italy and Greece on your left, Italy on top, Greece on the bottom, where the production levels locally has been declining, and with that, there has been a drop in consumption. The opposite happens on the right side. We have two examples, Turkey and Australia, where increasing levels of domestic production have helped to continue to drive increasing levels of domestic consumption.
In the case of Australia, it is particularly relevant to see that the domestic consumption has been growing at a faster pace that the domestic production has been growing, which is why we remain so confident that it is going to be, I would not say easy like Rob, but not difficult to place the additional oil that is going to be produced here in the domestic market, even when we have additional export opportunities, should we decide to explore it. Back to the U.S.A. That growth in production and that growth in consumption goes with the production level that you can barely see on those bars. That is the little golden dots there. Less than 3% of the domestic market has been supplied by the American-produced oil.
This shows the combination of the two previous slides is that if growing production drives a significant amount of consumption, well, the U.S. has been growing significantly without any help with the domestic production. So, by adding the extra amount of oil that we are going to be producing over the coming years, we are very, very confident about being able to drive that market, not just take market share, but to grow that demand over and above where it sits today, particularly focusing on high-quality premium extra virgin olive oil.
The other reason why we are confident is because we can see on the side. When you compare the other two large markets in the world, Spain and Italy, their consumption per capita is already at 8- 10 kilograms per capita, which is roughly what you need to consume to get all the health benefits of extra virgin olive oil. The U.S. is only at 1.4, so it is still a long way to grow on a per capita basis, obviously over a very large market. With this, I am sort of wrapping up my presentation. So, how do you say? It is important to, forget about the tons, again, the hectares, the percentages. I think that these takeaways that we have here are probably the most important things that you need to remember, or feel that you need to remember.
The first one is we have a leading production position, both in Australia and the U.S.A. Over 65% of the oil domestically produced here and in California are coming from our growers or from our partner growers. That, combined with really strong brands, puts you in an incredible position to capture that growth potential. Second, we have got incredibly high-quality assets across a number of different geographical locations with different water sources that really provides a lot of resilience from the supply point of view and reducing the agricultural risk, just like the growing portfolio of partner growers that we have also helps to reduce our agricultural risk. There is ongoing innovation going on, particularly on mechanization, optimization, automation, and with the deployment of Oliv.iQ and growing yields, we will continue to help to reduce our cost per liter.
As Rob said, we are playing in an industry with very strong fundamentals. We are playing with a product that is healthy, that actually ticks all the boxes of the links with origin, with authenticity, with quality. I think that with this, I am just wrapping up the presentation. Thank you very much, and I will leave you with Rob.
Thank you very much, Leandro Ravetti. As you can see, we can all talk a lot. The formal part of the meeting, and I will move as quickly as I can, but I understand we have to do it properly. The Company Secretary has confirmed that notice of meeting and explanatory memorandum dated 30 September 2026 were circulated within the required notice period, and they detail today's matters and will be taken as read. There is a good thing, we do not have to read them. Before considering the resolutions, I will briefly outline today's procedures. There were eight items of business. We will discuss each of these, allowing time for questions, and vote where appropriate. Each resolution considered today will be decided by poll. The results of the poll will be released to the ASX later today and published on the Cobram Estate Olives website.
As chair, I will vote all authorized undirected proxies in favor of each resolution. Eligible shareholders, proxy holders, and corporate representatives may ask questions when invited during each item of business and the general questions in the General Questions section. We will take questions from the floor first, followed by online and web phone questions. The first part, the Item 1 is financial statements and report. This is for consideration of the 2026 financial statements and reports. It is for discussion purposes only and not a resolution, but the auditor and the board and the staff welcome any questions that anyone might have with regards to the financial statements for FY 2026. Are there any questions from the floor? Good. Hasaka, is there any questions from-
There are no questions online.
Okay, excellent. We go to Item 2, which is remuneration report. This is Item 2 seeks to approve to adopt the remuneration report. The resolution and a summary of all valid votes received for this resolution are shown on the screen. Are there any questions from the floor? Hasaka, any questions online or on telephone?
No, there are no questions, Chair.
That is good. We better put this to the vote. Please select for, against, or abstain next to Item 2 on your voting card. Thank you. We will go to Item 3A, which is election of Non-Executive Director Daniel Masters. Item 3A seeks approval for the election of Daniel Masters as Non-Executive Director. The notice of meeting provides details of Dan’s experience and background, and I would just like to ask Dan to come forward briefly to address the meeting. While he is coming up, I will just say that Dan, I feel we are seriously lucky to have Dan.
He has lived in the U.S.A. for 14 years, nine of which were in Davis, next door to us, and he is originally from a sheep farm in South Australia, and he has bought something like 22 businesses with him and his partner in his fund in the States, and knows so many people in so much of the States, and has really been a great benefit to this business.
Thanks, Rob. I will be quick. Thanks for the opportunity to have a discuss my background to you all. My professional background, because I do not think the sheep farm is going to be very relevant here, is really centered on AGR Partners. It is an investment fund or series of funds that I started in 2012 with my business partner, Ejnar Knudsen, in the U.S. I have lived and worked in the U.S. from 2012 to 2015. In that time, we, Sorry?
Till 2024.
Yeah, correct.
You said 2015.
December 2024. I always round up. So we invested in 25 different companies in that time. On average, these are $30 million-$50 million EBITDA companies, and we've had the privilege of partnering with, they're all family businesses. And we've, on average, we've doubled the earnings in those companies. So that's been, we've learned a lot of the U.S. markets and how to build the pains of growth, the founder mentality that Rob mentioned. So we've learned a lot during that period. AGR's also made an investment in Cobram, but I'm here only to represent all shareholders. It's nothing to do with the AGR investment. And some of the lessons learned in the growth of those companies that we're involved with, I hope I can bring and contribute to the board. I'm happy to answer any questions.
Thanks very much, Dan. Are there any questions from the floor? Any questions online?
There are no questions online, Chair.
Where's the speaker that everyone's meant to walk up to, by the way?
Andy and Alicia have those.
Oh, sorry. Andy and Alicia have those. I am thinking if we do not get that speaker going, we can just keep moving and not have to. Thank you. We better put that to the vote. Item 3A, which is the election of Non-Executive Director Daniel Masters. Can you please select for, against, or abstain next to Item 3A on your voting card? Item 3B is a re-election of Non-Executive Director Craig Ball. Craig is probably known to many of you, and as I said before, he has been with us a long time, from helping us in the very early days in an unpaid capacity, helping us raise the money, being on our advisory board initially, being on our unlisted public company, yeah, public company, and then in this listed sense. This is the last term that he is seeking.
During this term, when we find someone better, we will replace him. I might ask Craig to come and say a few words, and then we can decide if we want to vote him in or out.
Somebody better? That will be pretty easy. I think this is the eighth time that I have stood before you, the Cobram shareholders, for election as a Non-Executive Director. I would like to say I am honored to have worked with an exceptional team for the last almost three decades. In this time, as Rob referred before, when you reflect back on what has happened through those eight election periods, we have had lots of ups and downs. The beauty of business that tests you is that it makes you stronger if you survive. Certainly, this company is surviving. The management team have an absolute demonstrated ability to overcome such challenges, and hence buying California Olive Ranch is not easy. The implementation is not easy, but we always had confidence that our team would be able to do that.
This is a company that plans for the long term, while setting short-term targets, and I am pleased to be part of this process. As Rob said, this will be my last term, and I look forward to remaining a Director for a few, let's almost count them in months now, but also as a shareholder for the long term. Thank you.
Thank you very much, Craig. I should have said this before, but for both Dan and Craig, the Board unanimously recommends that shareholders vote in favor of this resolution. Are there any questions from the floor? Online, Hasaka?
There are no questions online, Chair.
Okay. As there is no further question, please select for, against, or abstain next to Item 3B on your voting card. Item number four is approval Australian Employee Incentive Plan. I believe there has been no changes to this plan, and every three years it has to be renewed. I think that is the same for the U.S.A. plan, which is next. So, approval of the further details of the Australian Employee Incentive Plan, and the background to this item is provided in the notice of meeting. The resolution and summary of valid votes received for the resolution are shown on the screen. The Board unanimously recommends that shareholders vote in favor of this resolution. Are there any questions from the floor? Any online, Hasaka?
There are no questions online, Chair.
Good. As there are no further questions, please select for, against, or abstain next to Item 4 on your voting card. Item number 5 is approval of the U.S. Equity Incentive Plan. That is a separate plan because it is a separate country, and no changes have been made to this plan either, Sam, and its renewal under the automatic three-year renewal obligation. Further details of the employee incentive plan and the background to this item is provided in the notice of meeting. The resolution and summary of valid votes received for the resolution are shown on the screen. The board unanimously recommends that shareholders vote in favor of this resolution. Are there any questions from the floor? Any questions online, Hasaka?
There are no questions online, Chair.
Okay. Could you please select for, against, or abstain next to Item 5 on the agenda? The next items are Items 6A and 6B, which are the approval of issue of options to Sam and Leandro, and they need to be approved by shareholders because they are Directors of the company. For the purpose of Listing Rule 10.14, we seek shareholder approval for the issue of 1.5 million options to each of the Joint Chief Executive Officers under the employee incentive plan. The proposed options are exercisable at AUD 3.40 each, vest on the 1st of September 2031, and expire on the 30th September 2031. Further details on Items 6A and 6B, and the background of these items is provided in the notice of meeting. The resolution for Item 6A and a summary of valid votes received for the resolution are shown on the screen.
The board unanimously recommends that shareholders vote in favor of this resolution, and we are voting on resolution Item 6A. Are there any questions from the floor? Any questions online?
There are no questions online, Chair.
Okay. As there are no further questions, please select for, against, or abstain on your voting card next to Item 6A, which is Samuel's options. Item 6B is approval of issue of options for Leandro Ravetti. The resolution for Item 6B and the summary of valid votes received for the resolution are shown on the screen. The board unanimously recommends that shareholders vote in favor of the resolution. Are there any questions from the floor? Any questions online, Hasaka?
There are no questions online, Chair.
Please select for, against, or abstain next to Item 6B on your voting card, which is Leandro's options. That was great. Thank you. We now have general question time. If you haven't already done so, can you just vote for, against, or abstain to all the resolutions and check that that bit's done before we get excited in general questions? Voting results will be announced to the ASX promptly after the meeting. Anyone who would like to ask a question, there's a roving mic. If you stand up, walk to the edge, whatever's easiest, we're more than happy. If you want to direct, please say your name and who your question is directed to, if you have a preference.
My name is Lee Bryant. My probably address to you or Leandro. Just about whether you intend to continue marketing the three brands in the U.S., or do you have some plans for ultimately there only being two? If you don't have plans for going to two, what might be your reasons for not doing that?
Yeah. Okay, great question. We've put a lot of thought into that question, and we've had strategy sessions in the States on it, and obviously in the lead-up to buying it. Certainly, those three brands are important, and the reason they are is that having two brands is very important because not all of your oil is at the upper echelon where you can get the highest price for it every time. You do want consumers who are paying the highest price for the best oil to always get the best oil. If you just try and grow one brand to cover all, you reduce the quality on that, and then where are you putting the price to get consumer value, if you just put your consumer's hat on?
I think similar to Australia having Cobram and Red Island, which are slightly different price point, different packaging, and different quality, even though they're 100% comply with Australian standard. There's different qualities in extra virgin, as everyone knows in this room. That's the same. California Olive Ranch, as Leandro explained, is going to be where it's the highest price, and many cases with very different looking packaging, but in many cases, different size packaging as well. We'll put our best oil in there, and Cobram will still have fantastic oil in. It'll be slightly cheaper, slightly more affordable, get people into it. We'll over-deliver on both of those as far as the price. Lucini is a really fantastic brand.
In fact, when we first went to the U.S., the guy who founded Lucini, who was the first retail olive oil that had a big difference in price, and he did a great job at promoting that. COR, when it was 100% Italian. COR, when we bought it, had one Italian SKU or a couple of Italian SKUs, and then they had SKUs that were from the world. So we will probably still source, or we will source the highest quality oil we can get from Italy for that brand. There are great margins in that brand. And we will probably, the oil that might be from the world, we will clearly label it, and it will be fantastic oil from Australia. As good as anything we produce, it will go in there, because it is a very high-priced brand with great distribution and extremely loyal following.
As long as we are 100% up and down with the labeling, and we would probably put, because of its name, we would probably put an Italian-style Australian oil into that, but clearly say where it is from. And consumers can either buy Italian or they can buy high-quality Italian-style oil that would be similar varieties to what you grow in Italy. Any other questions? There is one over here. Andrea?
Michael Barrett is my name. I bought some shares on market, and I still hold them. Your presentation, Mr. Chairman, had a tone of a globalist type approach. There are a few issues I would like to take up on that. The first one is, will Australia and the U.S., they are two different production bases, will they be export production bases or cross sales and into the Australian market from the U.S. and vice versa and to other international markets? That is the first one. The second one is that, in the internationalization of this enterprise, and it has got all the markings of it, where do you see it going as an international company or a global company, or I will use another expression, a multi-domestic enterprise as well, which was more of a holding type operation with separate businesses in each geographic location?
That is the tip of a whole debate about how businesses organize themselves.
Yeah. The answer to the first question is that, no, there won't be Californian oil coming to Australia or anywhere else, at least in the foreseeable future. As I said in my presentation, it's important to us and what works is what you grow in each country, you sell in each country, effectively. Does that mean that we don't see opportunities for Australian oil, lower quality, great relationships with retailers, and sell some oil to the U.S.A.? But principally, what we grow in Australia, we sell in Australia. What we grow in the U.S.A., we sell in the U.S.A. As far as crossover between the entities, obviously, we harvest at different times. Staff particularly have the opportunity to move between Australia and California and to do harvest or to flowering or whatever we're doing, because it's six months difference in time.
It helps us speed up research, share equipment, share people, share knowledge to get us there quicker. As far as the global thing, we just really are 100% focused on Australia and California, and never say never, but we've only just expanded rapidly in the States, and we wouldn't do anything unless it made perfect sense and we could handle it in our view. Of course, we will always discuss opportunities. If someone comes along and says something's for sale or whatever, we look at it. But it's got to work. One plus one has to equal three, not just bigger for all sorts of reasons and end up failing. I'm not sure if that answered your question or what is the undertone that we shouldn't or Okay. Lucky he knows I'm imperfect. He doesn't expect a perfect answer. Thank you. Thank you for buying shares, Tony. Oh.
You might be able to hear me, I'm not sure. The question is regarding the national one. Sorry. Hello. My question regards the national irrigation and ecological water flows that emanate from the Burdekin River in Queensland. The Murray-Darling scheme has recently proposed the Mount Foxton Scheme, which is a gravity flow water scheme that can irrigate Victoria, New South Wales, Queensland, and South Australia. Will the board be interested in looking at and taking a position on it? That's question number one. The other one is with the current legislative framework of the EU agreement, will it significantly affect Cobram as far as the importation of olive oil from Europe, subsidized olive oil from Europe? Thank you.
Thanks very much, Tony. On the first one to do with water, obviously, I don't think we would have much influence on whether that scheme got up or not, but certainly, I'm pro-Australia improving productivity, innovation, and food security, and defense, and all those things, which means that if we do nothing, everyone will just keep getting poorer. I'm in favor if it makes sense, but of course, I'm just speaking for myself. I don't know what the board think. It's been spoken about for many, many years. I know this is a slightly different one. Thanks to you, I have read what's being proposed. I feel that irrigation water is money in the bank, and food is a very important part of Australia in many ways.
It seems that we just want, are really happy to import stuff from somewhere else because it is not in our backyard, and that just comes with all sorts of risks and does not seem to make a lot of sense that you would ban all your local fishing, but you are happy to just take everyone else's prawns from somewhere else or whatever. So, it is a debate that is well above what today is about. The second question, I seriously do not know whether that new trade. We do not do anything with Europe, obviously, as sending oil in there, because of import duties and tariffs and stuff, and it is a long way away, and how many ant nests can you kick over and do well? The U.S.A. has got plenty of opportunities, so that is where our focus is.
As far as impacting their exports to Australia, I would be so doubtful if that agreement did any of that, because Australia is the fourth-biggest consumer of olive oil outside of those Mediterranean countries, is my understanding, and they have always put a lot of pressure on government that any import duties or anything at all on olive oil, and we will not let your beef go there or something else. So, there are all these trade-offs. So, yeah, I do not have a view. I do not think so, but I do not know. Thank you, Tony.
Rob, Mark Topy. Just, if we get to the next interest rate increase, as we are expecting next week, and the consumers are hurting out there, just to pick up the sort of issue around the value drop that we are seeing in the market a bit. What sort of initiatives can the company take in terms of that value into the market in Australia? Is there any contemplation of more promotion, or how do we tackle the sort of pressure on the consumer that we are seeing?
Yeah. Thanks, Mark. That does occupy everyone's minds. It is not something that is a concern at the moment. It is not something that is new. We have seen in the past, Moro go from $30 or $40 a tin down to $15, and in these 30 years, we have had a lot of cycles. The buyer is generally different between imported oil and Australian oil, and we do not need to be more aggressive in the market in any way, because we are already bottling when we are halfway through harvest this year, which ideally we would be at least finishing harvest before we bottle to keep up with current demand. So, where it is impacting is more, which is just so obvious on the charts, and Sam spoke to it, is that when there was all the out-of-stocks, Red Island went up massively.
Cobram grew nicely, but now that the importers are fighting back, because when you take someone's market share, they do not just go, "Oh, yeah, well, I will go somewhere else." They fight back when they can with price and discounts and whatever. We have seen a lot of growth in there, and we have seen it impact Red Island a bit, but Cobram is still growing, and we are not seeing much margin dip. Of course, we are doing a few more promotions than at the peak, because we just had no oil at the peak, and half the shelf was empty during the worst part of this a couple of years ago. These things go in cycles. Another drought comes around next year or the year after, or some other production issue.
Education with consumers, the understanding on why the best value is in high quality and all those things is sort of what drives us. It is certainly not keeping us awake, and certainly we know that if we need to move more volume, there is no issue with moving it. You just put in a discount. But we are just doing the normal amount of discount at the moment, not heavy promotion or anything. You got to bear in mind that our prices went up 40% in the last three years, and now, everyone, the importers are aggressively discounting, and our sales have pretty much remained and have hardly given back any margin because of a great product. I am not sure if that answers the question, but that is how I have answered it. Thanks, Mark.
Peter Cox is my name. Rob, diesel fuel, price has gone up. Are you having any issues regarding availability, and is it impacting significantly on the bottom line? That is one question. I might have two.
Yeah.
The other was, do you see a time when you might pay two dividends a year as distinct from the one?
As our largest shareholder, I would be very happy to pay two. Historically, we have sort of paid one because of everything coming from Australia. I think what you are saying is it fits a lot more as of the norm. The U.S.A. is going to become a really big part, so, yeah, I would like to think that we can move to that and increase them. Again, that is a decision for the board, and it is a very relevant point. What was the Sorry, what? Oh, diesel. There was a few supply shocks before harvest. We were not harvesting. We never ran out of diesel or anything, but it was a bit hard to get because everyone panicked when Iran was first invaded, and it was just filling up diesel tanks. It was hard to get. I think they were sowing crops at that point.
At the moment, there is absolutely no issue with supply. We have two different suppliers. One lot sort of comes from Adelaide to the Boundary Bend grove in Mildura, is my understanding. Another lot from the Geelong port, and it is just the price that varies. We were talking this morning's board meeting about hedging options on that. It is not a, Look, how much do we spend? What percentage of our operating cost would diesel be? Sorry to put you on the spot.
Less than 5%. Around 5%.
Yeah. Around 5% of our operating costs would be diesel. So, it is not insignificant, but it is not like It will not have the impact on us that something like water can have, if that makes sense.
Thanks, Rob. Peter Comrie. You have touched on water costs, short-term water costs specifically. I was just curious what, if you can speak for the board, what you would see as the top two or maybe three issues that maybe do keep the board awake a little bit at night, and the current mitigation thinking around those top two or three. Thanks.
Yeah. Water, it does not keep us awake, but because we have got a crop that will not die if you are not watering them, you can get it. But it can have a big cash hit. On the flip side, then it rains, and you are getting it the other way. So, it is a concern, but more around the ridiculous water policy in Australia versus anything else. Probably fire is always a risk. Both California and our groves here are in high fire. Insurance is harder and harder to get and less and less of it. So, even this morning, a lot of discussion and a lot of work goes in from the Dales here, but to just having as many bare areas as you possibly can, because our groves are not just wall-to-wall. There are lots of areas that are not planted.
There are lots of surrounding areas, and trying to reduce that to no fire is probably the biggest part, and probably is our biggest risk, to be honest. We have never touched wood. And there are lots of things you can do, but you just never say never.
Tony Brosnan here. Leandro, can I just direct this to you? The cost of doing business in California is probably more expensive than anywhere else in the U.S., and California does have a negative sentiment amongst a lot of Deep South states at the moment due to political considerations. Has that impacted the price or the effectiveness of the California brand?
There's definitely a lot of differences between the states in the U.S. In the case of growing olives, there's no option. California is the only place that has the right environmental conditions to grow olives. The reality is also, sometimes California, it's linked too much to what really happens, but happening in San Francisco or L.A. The rural California had nothing to do with it. The way that the councils in rural California behave, the way that the systems operate, actually very, very different, and very friendly in many ways with agricultural activity, especially permanent crops. There is a reason why California is such a powerhouse in terms of almost every permanent crop that you can think of. There's definitely a higher cost in certain areas.
There's certainly, but it's nowhere near as much as it's generally perceived to be, which is more linked to what might happen in San Jose, San Francisco, or L.A.
Part of the question was whether other states don't want to buy it because it's California or other people because of that red-blue divide. It's hard to. We're not seeing that, but it's probably some consumers might have that view. We better see if there anything online, Hasaka? Sorry, we can come back. Just if there's 50 racked up there, we might be here a while.
No, there's no questions online.
Oh, brilliant. Okay, any other questions?
Andrew Walpole. Currently, we do not have a buyback program, but I note the share price has had a little bit of a rollercoaster, and is the board considering a buyback program if the price were to drop to some sort of level?
Yeah. Thank you. Not at the moment. Not that we do not think they are wonderful value, but we have got a lot of capital projects we are funding. We have just bought another business. We would probably just want to cement our position better before we would do that. But again, it is a board decision. I 100% agree they are fantastic value at the moment, and they have weakened a fair bit. And I get the point, but we have got debt, not cash in the bank, so we are in a different position. Nothing is cheap if you cannot afford it, as the old saying. Any other questions?
Thank you so much for your patience, and sincere thanks for making the journey all the way down here. It is so lovely that we go to, Well, everyone else goes to all this effort, and to see so many who make so much effort to come is so good. We better get the organization right here. The purple hats go with Leandro, and there are three groups. And to do a two, otherwise you just And look, to be really honest, it is a bit of a waste of time, Leandro, talking to 100 people in there with noise of It is just, you do not hear. So, you will sort of see a lot, and sometimes the questions might be answered back here or when you get outside the building, if that makes sense, try and keep it moving. Oh, what do we got to do?
Everyone needs to complete these cards.
Oh, yeah, everyone's got to complete these cards. Hasaka's just earning his money. Drop them at the front when you go out. Very important. Just make sure you've voted. That'd be wonderful. I reckon anyone with a purple hairnet, if they've completed the cards, drops it out there, just follows Leandro out that door. The next ones up are red, and they go with Sam. It's all very easy. You know Sam and Leandro. Green then goes with Andrew, with the green's the last. Purple, Leandro, you better get cracking.