Good morning, ladies and gentlemen. My name is Rupert Harrington, and I am the Chairman of Clover Corporation Limited. I welcome shareholders and visitors to the 2021 annual general meeting of the company. The company secretary has informed me that a quorum is present, and therefore I formally declare the meeting open. I acknowledge the traditional owners of the land on which we are meeting. I pay my respects to their elders, past and present, and the Aboriginal elders of other communities who may be here today.
Thank you for attending online. We are again using the Lumi platform to host the meeting. The platform allows shareholders, proxies and guests to attend the meeting virtually. All attendees can watch a live webcast of the meeting. Only shareholders and proxies have the ability to ask questions and submit votes.
By reason of travel restrictions in place and ensuring we comply with DHHS on social distancing, your board is not assembled in one place. Before we proceed, I would like to introduce to you the other members of your board. With me in person today are Mr. Peter Davey, the Managing Director and CEO, Dr. Simon Green, Independent Director, and Mr. Graeme Billings, also an Independent Director and Chairman of our Audit and Risk Committee.
In Sydney is Ms. Toni Reddish and Mr. Ian Glasson, who is the Chair of our People & Culture Committee. Also present here is Mr. Andrew Allibon, the Company Secretary and CFO. Online is Mr. Steven Bradbury, representing our auditor, PKF. Steven will be available to answer questions on the accounts at the appropriate time.
To attend this meeting, you will have downloaded the Lumi app and entered the credentials provided to you that recognize you as a shareholder or proxy. Alternatively, you may have entered as a visitor or guest. In respect of the agenda, I would like to address the general housekeeping around questions and voting before we proceed further.
I propose that the final notice of meeting dated 15th of October 2021, which was mailed to shareholders, be taken as read unless there are any objections with the formal matters noted on the agenda. If we move to the next steps around questions and voting online. To ask a question on Lumi, in the Lumi app, press the speech bubble icon. This will open a new screen. At the bottom of the screen, there is a section for you to type your question.
Once you're finished typing the question, hit the arrow symbol to send. Please note that while you can submit questions from now on, I will not address them until the relevant time in the meeting, either when the particular item of business is open for discussion or after the close of business, but before the close of voting polls. I ask that in the interest of time, and to allow as many questions as possible to be addressed, please try to keep your questions in a moderate length.
Please also note that your questions may be moderated, and if we receive multiple questions on one topic, amalgamated together. If you're on the phone, as you note on the slide, and you wish to ask a question, please press star one to join the verbal question queue.
Please mute your webcast if you choose to use this method to avoid any audio feedback. Finally, due to time constraints, we may run out of time to answer all questions. If this happens, we will answer them in due course via email and by posting the responses on our website.
In accordance with current practice, voting today will be conducted by way of a poll on all items of business. I will shortly open voting for all resolutions, and if you are eligible to vote at this meeting, a new polling icon will appear. Selecting this icon will bring up the list of resolutions and present you with voting options. To cast your vote, simply select one of the options. You have the ability to change your vote up to and until I declare the voting closed.
In the unlikely event that we experience a loss of signal with the webcast, please do not log out from your Lumi app. We have a backup webcast stream running, which will automatically appear on your Lumi app within about 30 seconds of the initial loss of signal. Finally, voting on every resolution is held open until the end of the meeting. That concludes the housekeeping on the questions of voting. Before we move to the formal business of the meeting, I would like to present my Chairman's address. Following my address, Peter Davey will give a presentation on the operations of the business.
On behalf of the Board of Directors of Clover Corporation, I am pleased to present our annual report for 2021. Shareholders will be aware that Clover, like much of the world, has been impacted by the global COVID-19 pandemic, which has reduced sales for many of our customers, combined with challenging conditions in supplying infant formula into the China market. The company continues to see good opportunities for growth in health food segments. However, developments of these markets was constrained due to COVID-19. The company has continued to maintain a focus on the health and safety of its employees operating under COVID-19 safe plans. Many staff have been asked to work from home for much of the year, while the core of operational staff have maintained the day-to-day production of the business. Thankfully, no staff have contracted COVID-19 during the year.
The company has not received any financial assistance from the government. As highlighted, at the half year, Clover experienced challenging trading conditions as our major customers delayed new projects, reduced their orders due to lower customer demand and the challenges of servicing the China market. The 2021 financial year summary is revenues of AUD 65 million compared to the prior year of AUD 88.2 million. Net profit before tax of AUD 6 million compared with AUD 25 million in the prior year. Excluding Melody Dairies's operating loss and our IP legal defense costs, the underlying net profit after tax for 2021 would have been AUD 73 million. The balance sheet remains strong with cash at AUD 9 million, compared with AUD 9.2 million in the prior year. That places the business well to support growth opportunities and to service existing debt.
Clover has continued its strong focus in development of new products and in expanding into new markets outside of its traditional infant milk powder customer base. The company maintains a strong global pipeline of new opportunities with new products, customers and markets. This has resulted in the company launching new products through 2021 financial year.
The targeted customers are now trialing those ingredients to develop their own new products, which will be released in the future, having secured orders of sales for 2022. In addition, the company continues to work with customers in developing encapsulated products for the planned legislative changes in Omega-3 levels in infant milk formula segment in China. While it has experienced delays due to COVID conditions, a reasonable conversion of this pipeline should provide a base for future growth for the company.
Clover has and will continue to invest in its people to ensure timely response to customer and ongoing development and growth of the business. The company also focuses on improving competitive capability with the investment in Melody Dairies is expected to be fully operational and to reach cash neutrality in 2022. The R&D facility in Brisbane has been relocated to a larger facility, and that will include a new pilot production plant that will improve confidentiality of product development plans and reduce development time cycles. Based on the performance of Clover's financial year 2021, the directors declared a fully franked final dividend for financial year 2021 of half a cent per share, making the total dividend payable for the year ending 31st of July 2021 of AUD 0.1 .
The prior year was AUD 0.25 per share. Turning to the financial year 2022, it is clear that COVID-19 will continue to impact our business as it has, as outlined in September with our financial year 2021 results announcement. Over recent months, we have seen more confidence in the market and this is reflected in a more stable forward order book, albeit with little growth at this stage. We expect to re-engage with our customers on a face-to-face basis during the financial year 2022 as international travel opens up. This is essential to support future growth. On behalf of the board of directors, I would like to thank our shareholders for their continued support. I would also like to acknowledge and thank our CEO and employees for their continued hard work and dedication and commitment to Clover.
I would now like to hand over to Peter Davey to present his report.
Thank you, Rupert. Welcome to the Managing Director's report for the 12 months to 31st July 2021. Our vision, values and purpose statement is always the way I start these presentations, and I thought I'd just read through to you our purpose statement. In collaboration with key market participants being our customers, Clover develops customized high value nutritional ingredients that enhance the well-being and dietary needs of their customers. I think it's a really good statement around what we actually do. We work with people to develop solutions, and it's what keeps this business in front of many others in the marketplace. An overview, a look back for the year of what's happened. Our revenue was AUD 60.5 million, down 32% on the prior year, and we'll talk more about the details of where it's gone.
Net profit AUD 6 million, down 31.9% on the prior year. Our operating expenses at AUD 8.7 million was down 23.7%. We introduced a series of new products that we'll talk through that have allowed us to enter new markets and find new customers. Our inventory position, whilst down slightly, is still quite high at AUD 30.8 million, and I'll talk more to the details around that. Balance sheet continues to be strong at AUD 9.1 million. Overall that, the cash position allowed us the directors to declare a dividend of AUD 0.005 per share, bringing the full year to AUD 0.01. An update on COVID. We have continued to manage this business to a COVID safe plan.
Really, the critical thing for the business is ensuring the safety of our employees, customers, and all stakeholders in the business. We have had demand curtailed by COVID, so that's a significant part of the story of the year. Less movement of people and less demand in the marketplace. We maintain a relatively high position in terms of inventory, and that's relative really to constraints around shipping. So many ports have been closed due to COVID conditions, and it's increased the freight costs around the world, where our inventory has moved from more of a finished good back into a raw material, so we have the ability to convert and supply orders. The company's not received any government assistance during the pandemic, and many of our customers and many of our employees continue to work from home.
With more than 80% of our customer base located overseas, traditionally, the growth of this business has been through face-to-face visits, and it's been very difficult, obviously, with travel impossible in the current market to continue to drive business and establish those relationships. Sales by geography. E.U. sales were down slightly, a bit disappointing. E.U. market's been in shutdown, undergoing COVID conditions. They've also been impacted by the China market slowdown there. The key to our story is, though, that the Asia and Australia/New Zealand market's been down significantly and mostly in New Zealand. Our New Zealand customers and a lot of the infant formula market is heavily reliant on the Daigou channel.
The Daigou channel relies on Chinese tourists and Chinese students that live in Australia or travel to Australia and New Zealand and other parts of the world. They buy products, and they send it back into China, either through the mail, through deliveries, or they take it back in baggage. Of course, that marketplace has been effectively shut down due to COVID and relatively no travel. The Americas, while very similar to the prior year, was a bit disappointing because we had really high hopes for that marketplace. Again, the marketplace has been curtailed because of COVID conditions. Many of our customers across America have put their projects on hold, and most of our customers are actually working from home. They're not working in their laboratories or factories or their test kitchens, so new product development has been slowed because of that.
The full year result 32% down year-on-year in revenue. A key part to that was the pantry stacking that occurred. If you look back at the FY 2020 result at AUD 88.3 million, it was a record year for the company. A significant amount of those sales came in the last quarter of the year, and that was due to people pantry stacking. Consumers going into lockdown went out and bought a lot of infant formula. They put it into their cupboards, and we refilled the channel. Then after that, consumers utilized the product they had had at home and didn't go back and buy it again. Naturally, we saw probably more than half of the year with reduced sales driven by that pantry stacking.
Margin declined a little, 3%, heavily driven by FX and a bit of the customer mix that we saw through the business. We managed our costs relatively well, so down significantly year-on-year. Across the entire business, we reduced our costs. Our tax position improved slightly, and that was relative to the R&D in the business. We had R&D claims against our tax position. Net profit was AUD 6 million versus AUD 12.5 million the year before. As Rupert alluded to, if we took out the one-off costs associated with Melody Dairies, which I'll cover a bit more, and our legal defense of our intellectual property, our underlying NPAT would've been AUD 7.3 million, a lot more palatable. The balance sheet continues to be a good story for the business.
Very strong in terms of cash that allow us to pay dividends and puts us in a good position for trading. Receivables and payables are both really in line with the reduced sales. Our inventory, while a little bit down, we are holding quite high inventories relative to the ability to be able to bring in raw materials. Globally, we're finding that getting raw materials into the country, either into Australia or New Zealand for our production facilities, has been difficult. Even getting shipments to customers has also been difficult. We're tending to have to supply customers significantly earlier than what we would've in the past. A bit regarding Melody Dairies. You'd be aware that we own 42% of a company called Melody Dairies in New Zealand. It's in the North Island in Hamilton.
That gives us access to a dryer. COVID delayed the startup. It's a greenfield site, brand new build. The construction was delayed by some three months, and then the government accreditation to actually say we can manufacture product there, that was delayed by about another three months. Then acceptance testing by our customers was really delayed by more than a year, and still some customers haven't been able to get there. Generally, where you're dealing with food or infant formula, your customer will have to come and audit your facility, and because of the travel restrictions into New Zealand, many of our customers haven't been able to get into New Zealand. We've been impacted by our shares.
42% of shareholders, we've had to meet some of the costs associated with the losses of that business, and that cost us AUD 800,000 in the year. Some customer audits have now been completed. Virtually all of the local customers have been through, and we have started to manufacture successfully on the dryer late in the FY 2021 year. We expect that to be much fuller in the FY 2022 year and break even across that business for the year. We won't see those losses recurring. An update on our growth platform. We generally talk about the key platforms for growth in the business around new product development, our focus on infant formula, and the new market development we do. We've tried to represent these a little bit differently this time.
Market development is really a story of how we diversify the markets for the business. While at the top, infant formula is a key part of our business, we're looking for growth and expand into other general areas of the marketplace. We've done a lot of work around customer development, product development that gets us into the general food market, and we've been quite successful going into milks in other markets, into sports nutrition. We see that as a great potential marketplace. We've only got a small amount of business there at the moment, but we've got some specific product development that's working in there. Into pharmaceuticals, there's a crossover between a pharmaceutical/nutraceutical world called Food for Special Medical Purposes. We recently launched a new product. It's got high EPA.
EPA is an extract of Omega-3, and it's renowned for reducing inflammation in the human body. It's now being applied into Food for Special Medical Purposes and being taken up by customers in the U.S. and in China. Very recent. We're starting to get some traction with that new product. Our supplements, we've talked about gummies in the past, and we're getting better growth in that, but also into the pressed tablet area as well. Plant-based market. People would be well aware that the plant-based market is growing rapidly. Nu-Mega has launched and has a series of products that are completely plant-based. They are considered vegan, organic, and so we are well positioned to take advantage of that marketplace, a very large U.S. market when the U.S. comes out of their sleep that they're currently in. Our product development.
Applications of some of our products that we've actually got in marketplace now. Gummies, we've worked with a series of gummies manufacturers with our hypoallergenic product that has a 50% fish concentrate. We can now get into one small gummy, 200 mg of DHA. That's an element of DHA of Omega-3. In a tiny little gummy, we can give a person their daily dosage, which is quite an amazing result. Our sports bars, we're using a dry form, 60% fish oil concentrated powder. We have one of the largest manufacturers in the world with a 250 mg bar, and that's that supplies into the sports nutrition market. We have gone into extended shelf life dairy-based drinks. We now have two customers in that marketplace using our dry form 50 algal powder.
It's not a fish source, but the source of the oil comes from algae. Into that milk product, we're getting 125 mg per serve. That product is now available in the U.S.A., and it's recently been launched into China as well. We're doing compressed tablets. We're using a hypoallergenic 50%, again, an algal powder, so it's not a fish source. It comes from an algae. Into a small tablet, we're getting 180 mg of DHA. Again, nearly your full daily dosage in a capsule, in a tablet. Recently, we've developed a UHT application. It's a new product that's about to go to marketplace. It's called Gelphorm. We've registered the brand Gelphorm.
We have registered the intellectual property around the Gelphorm product, and we are now capable of taking DHA, so the Omega-3 through the UHT process that no one's been able to achieve before. We will set up pilot production in the FY 2022 year and start supplying it to customers for samples and testing. Great deal of interest in UHT across the world. The final growth platform is around our focus on infant formula. Infant formula is certainly a key plank of the business and continues to provide us with opportunities, especially mainland China. China, we spoke about previously where they had draft legislation. They have now legislated that policy, which will require all infant formula, if you include DHA, to have a minimum of 15 mg per 100 kcal.
That's a measure of the calories that are involved in the infant formula that's made and an equal quantity or more of ARA. There are two omegas. One's an Omega-3, the other one's an omega-6. That's been fully approved, and we're now working to transition with manufacturers to reach those levels. Many manufacturers are at only 5 mg today or zero. All products have to be transformed into that to meet that legislation by February 2023. We'll see that in a year's time. What we've done with the China marketplace is we've changed our strategy. We used to go to marketplace through a distributor who represented us with our customers.
We now have our own representation in marketplace, and we've established direct customer contact with all of the major Chinese manufacturers, and we have aligned different distributors with each of those customers. Each customer has different distribution options that they want to pursue, and we've identified those and starting to work with them. We now represent the technical relationship with the end customer rather than having someone in between us through our own staff and our own technical support. Our products have now been qualified with several of the major local Chinese infant formula manufacturers, and they are doing their license submissions, which will include Clover's micro-encapsulated powders. Effectively, if you want to sell a product, an infant formula product into the China marketplace through the retail channel, you have to have a license called a SAMR license.
That license you have to submit with all of the ingredients associated with it. We have been included in several of those licenses as a supplier, as an optional supplier within the infant formula. It gives us great scope for improvement in our business into Mainland China. And that'll come on in February 2023 and beyond. We'll look at our first half for FY 2022, the outlook and the priorities for the business. Absolutely key for the business is to maintain the safety. We've done extremely well maintaining the safety of our people and our products and everybody associated with the business, and we're continuing to do that. We are meeting supply chain challenges, getting raw materials in and working with our customers to make sure that we don't miss an opportunity.
The world is full of stories how shipping is challenged to actually get bookings or get containers and get product on time to customers. We're working with the customers and our suppliers on a daily basis. It's really being managed by hand. The real part of what we see is the opportunity for the business is starting to re-engage with customers. We haven't been able to go and visit customers and travel in marketplaces for nearly two years, it's very pleasing that we've now got China opened up. We've got our people in China being able to travel within Mainland China. Our European travel has just started, so we've got our European staff starting to see customers again. In the U.S.A., just beginning to start travel there as well.
We've got trips planned into the new year where we will start to travel from Australia into international markets for the first time in two years. Re-engaging with customers will restart a lot of the projects that have been on hold for a long period of time. We will start launching some of the new products we've discussed today and talking to them about them. We have a suite of products that help people with solutions that will help them get new products to marketplace, and I genuinely believe that customers will be looking at opening up and developing new opportunities to launch into the marketplace. We're always looking to increase our integration to our supply chain. Melody Dairies was a great example of that.
We've signed contracts with excellent suppliers of oils, and we're looking to establish our position into our supply chain to ensure that we get the best price, quality, and availability of products for the future. We are always on the lookout for strategic acquisitions and partnership opportunities, and so we will continue to pursue those into the future. My final statement is COVID conditions and associated government responses globally can be expected to continue to impact Clover's customer base. It's naturally what's going on in the marketplace with uncertainty. As the year advances, the current order pipeline still reflects little growth over the prior year. That's the current position of the business. Thank you very much. Appreciate your attention. Thank you.
Thank you. Thank you, Peter. We now move to the formal business as set out in the notice of meeting. Each of the resolutions will be taken in turn. I will introduce each resolution. Shareholders will have a chance to ask questions on the resolution, and I will display the proxy results for the resolution on screen before we move to the next resolution. Voting is now open. I now move to the first item of formal business. As required by the Corporations Act, the financial reports of the company for the year ending the 31st of July 2021, comprising the company's financial statements and the directors' declaration, together with the directors' report and the auditors' report, will be considered, and I present a copy of them to the meeting, which is signed by me for the purposes of identification. I invite you to ask any questions about these reports.
I remind you that there are no resolutions required for this item. Please limit your questions at this time to matters relating to the financial statements and other reports. There will also be time for general questions at the conclusion of the meeting. Questions may be addressed to me or to Mr. Steven Bradbury of PKF, the company's auditors, through me. Are there any questions regarding the report? Mr. Andrew Allibon, is there any questions?
In respect of questions of the financial statements, no, we have none at the current time.
Thank you, Andrew. If there are no questions, we will move to the next item of business. I now move to item 2, resolution 1, set out in the notice of meeting, which relates to the adoption of the remuneration report for the year ending 31st of July 2021. The remuneration report is in the directors' report section of the company's annual report. By way of summary, the remuneration report explains the company's remuneration policy and the process of determining the remuneration of its directors and executive officers. It sets out remuneration details for each director and each of the company's executives named in the remuneration report for the financial year ending the 31st of July 2021. Section 250R(2) of the Corporations Act requires companies to put a resolution to their members that the remuneration report be adopted.
Please note that the resolution is advisory only and does not bind the board of the company. I move that the resolution for adoption of the remuneration report for the year ended 31st July 2021 be put to the meeting in the form of resolution set out in the notice of meeting. Details of the proxy votes in respect of the proposed resolution are shown on the screen. Are there any questions regarding the remuneration report?
There are no questions online, Mr. Chairman.
Thank you, Andrew. As there are no questions, I put the motion that the remuneration report be adopted. I now move to the next item. The third item being the second resolution relates to the reelection of myself. I am required to retire by rotation pursuant to the constitution and being eligible, offer myself for reelection. At this stage, I pass the chairmanship of the meeting to Mr. Graeme Billings for this item.
Thanks, Rupert. Just by way of background, Rupert has been a Non-Executive Director of the company since 1 July 2015 and was appointed Chairman of the company on 21st September 2017. I would now like to ask Rupert to address the meeting to discuss his background and credentials he brings to his director role.
Thank you, Graeme. I've appreciated the opportunity to work with the board and management over the last six years as an independent director and as chairman of the company in delivering returns for the shareholders. I'm also a non-executive director of Integral Diagnostics, an ASX-listed company, and also Pro-Pac Limited, an ASX company. Subject to my reelection, I confirm that I am committed to the growth strategy of the company and would welcome the opportunity to continue to work with the board and management to deliver positive returns for our shareholders going forward. Back to you, Graeme.
The board, with Rupert abstaining, unanimously recommends the reelection of Mr. Harrington as a director of the company and recommends that you vote in favor of the resolution. Details of the proxy votes in respect of this resolution are shown on the screen. Andrew, are there any questions regarding resolution two?
Thank you, Graeme. No questions.
As there are no questions, I now put the motion that resolution two be adopted. This concludes item three, and I will hand the meeting back to the Chairman.
Thank you, Graeme. The fourth item being resolution three, as set out in the notice of meeting, relates to the approval of the acquisition of FY 2022 performance rights granted to the managing director under the company's long-term incentive plan to permit the company issue or otherwise provide underlying shares in satisfaction of performance rights rather than buying shares on market. The managing director has 353,602 outstanding performance rights in total, which includes the 140,575 performance rights, the subject of resolution three. The terms of these performance rights are summarized in the notice of meeting.
I move that the resolution for approval of the acquisition of the Managing Director's performance rights and the issue or other provisions of shares in satisfaction of the performance rights be put to the meeting in the form of Resolution 3, set out in the Notice of Meeting. Details of the proxy votes in respect of this proposed resolution are shown on the screen. Andrew, are there any questions regarding this resolution?
There are no phone questions. No questions online, Mr. Chairman.
Thank you, Andrew. As there are no questions, I move the approval be given for the grant of the performance rights to Mr. Peter Davey on the terms described in the explanatory memorandum accompanying this notice of meeting. I will now move to the next item. The fifth item being Resolution 4 set out in the notice of meeting relates to the approval of certain benefits under the Managing Director's financial year 2022 performance rights. Shareholder approval is being sought under Section 200E of the Corporations Act to allow the company to give Mr. Davey the benefit resulting from his early vesting of his financial year 2022 performance rights should his employment end in certain circumstances, as further explained in the explanatory notes to the notice of meeting.
I move that the resolution for approval of certain benefits of the Managing Director's financial year 22 performance rights be put to the meeting in the form of resolution 4, as set out in the meeting. Details of proxy votes in respect of this proposed resolution are shown on the screen. Andrew, are there any questions regarding this resolution?
No questions online, Mr. Chairman, and none by phone.
Thank you, Andrew. As there are no questions, I now put the motion that resolution 4 be adopted. I now move to the next item. The sixth item being resolution 5, as set out in the notice of meeting, relates to the approval of the long-term incentive plan, which is required under Exception 13, Rule 7.2 of the ASX Listing Rules. Exception 13, Rule 7.2 applies to the issue of securities under an employee incentive scheme needing to be approved every three years. The plan was previously approved at the 22nd, 23rd of November 2018 annual general meeting. I move that resolution for approval of the long-term incentive plan be put to the meeting in the form of resolution 5, as set out in the notice of meeting.
Details of the proxy votes in respect of this proposed resolution are shown on the screen. Andrew, are there any questions regarding Resolution 5?
No questions, Mr. Chairman.
Thank you, Andrew. As there are no questions, I now put that Resolution 5 be adopted. I will now move to the next item. The seventh and final item for formal business relates to Resolution 6, set out in the notice of meeting relating to the approval to increase the non-executive director's remuneration aggregate fee limit from the current AUD 500,000 to AUD 750,000. I move that the resolution for approval for the proposed increase of AUD 250,000 to the aggregate fee limit be put to the meeting in the form of Resolution 6, as set out in the notice of meeting. Given the interest of non-executive directors in this matter, the directors make no recommendation regarding Resolution 6. Details of the proxy votes in respect of this proposed resolution are shown on screen.
Are there any questions regarding Resolution 6, Andrew?
There are no questions, Mr. Chairman.
Thank you, Andrew. I now put the motion that the resolution 6 be adopted. This brings the formal part of the meeting to a close. With the formal business of the meeting having been completed, I now open the floor for questions from shareholders to the board. Andrew, are there questions for the meeting?
Yes, Mr. Chairman, we have three questions and there's a series of questions within a question, but I'll start. The first question comes from Gary Ellis. As a partner of Clover in the Melody Dairies facility, Pāmu Farms is manufacturing sheep milk products. Does Clover see potential in marketing its ingredients in this growing industry?
Thank you, Andrew. I'll ask Mr. Peter Davey to respond.
Thanks, Gary, for the question. Yes, we do see a great opportunity in that field. Clover launched a microencapsulated DHA and ARA product some three years ago that targeted the growing milk and goat infant formula market. We are the number one supplier to goat and infant formula manufacturers globally. We have the only product that really can suit those products, especially from an organic perspective. Yes, we think there's great prospects, and it continues to be a growing segment within the China market.
Thank you, Peter. Next question, Andrew.
Gary has a couple of questions. I'll read the, he's set it out. There's a third question as well. Both Bubs Australia and Halo Foods, formerly Keytone Dairy, have recently released ASX notices revealing significant increases in China trade. Has Clover experienced similar resumption of China trade in recent months?
Thank you, Andrew. Peter, would you like to comment on that, please?
Sure. Yes. I've seen the reports of a number of infant formula manufacturers that have reflected improved demand. We haven't seen that reflected in the ingredients that we currently supply. Certainly hopeful that we do see that flow on into our business in the future.
Thank you, Peter.
Gary's next question and a question from Stella Wang of CTHD Investment will probably address the same matter. I'll read out Stella's question, if I may. I'm a shareholder. Thanks for taking my general question. Since Thai Union has taken a strategic stake in the company, have the two companies discussed potential joint venture strategic projects? And also Thai Union already have a facility in Europe. Would that help Clover in expanding capacity in Europe? And does Thai Union stake help Clover with raw material supply security?
I may answer the question initially. Thai Union is a shareholder, and its rights as a shareholder are no different to any other party who is a shareholder in Clover. They don't get any special consideration in relation to information or treatment in relation to commercial relationships. Long term, we've had a commercial relationship with Thai Union in relation to the supply of oil. As part of that program, we also distribute oil in Europe and elsewhere for some of their products. That is a normal commercial relationship that was part of a long-term discussion before they became a shareholder in Clover.
The third and final question comes from John Percival from Deep Moat Capital. What is the status of the legal proceedings against a competitor and former employee? When will this likely be resolved? What processes has Clover implemented to protect its IP?
This has been an ongoing legal matter, and I'm not going to discuss the details of the legal proceedings. I think. Excuse me, that's something terrible that a chairman shouldn't do. Proceedings are ongoing. We've taken appropriate legal advice, and we are strenuously protecting and arguing the case that our IP has been infringed, and we intend to continue our legal proceedings to come to a satisfactory outcome to protect the interests of our shareholders.
In terms of questions, there are no further questions at this time, Mr. Chairman.
As there are no further questions at this time, that is the end of business, and the voting will close shortly. I'll pause for a moment to allow people to finalize their votes. The result of the ballot will be on our website at the ASX this afternoon. The voting is now closed. The results of the poll will be announced via the ASX later today. As the business of the meeting has been concluded, I declare the meeting closed. I would like to thank you all for your attendance today and your continued support of Clover Corporation Limited. I look forward to updating you on our half-year results in due course. Thank you.