For Noumi. It's a pleasure to be with you today, and thank you for joining the call. We've uploaded the relevant materials to the ASX. You can navigate to the slides as you choose or follow on the screen. Questions can be submitted at any time. To ask a question, press on the Q&A icon. This will open a new screen. At the bottom of that screen, there is a section for you to type in your question. Once you have finished typing, please press Enter on your keyboard. You can also type that you would like to ask a question verbally, and we'll unmute your line. Please note that while you can submit questions from now on, we will not address these until the relevant time in the meeting.
I will focus on the overview of the results and discuss the key elements, the progress of the company during the year. This will be followed by our strategy for the upcoming period. Iain will follow with the financial performance for the period, followed by closing remarks. Genevieve will take you through the scheme's implementation date. We'll then move to Q&A at the completion of the formal presentation. The key messages for today's call is consistent execution of our strategy is delivering results. I'm proud of the progress we are making as we execute our plans, but there is more to do. As you will see in the results, FY 2026 is another year of consistent progress for Noumi, with modest growth in revenue and underlying earnings delivered alongside deliberate investment in brands, people, and capabilities.
These results were delivered in a challenging period with a number of external factors impacting the results. The investments into our brands delivered revenue growth. Solid adjusted operating EBITDA growth in FY 2026, with revenue growth supported by dairy commodity pricing and a broader mix of brands, channels, and markets. Total MILKLAB brand revenue grew 5.5%. HORECA was flat as economic conditions tightened, although export was up 11.2%. With the continued growth in MILKLAB in retail, we have seen 44% revenue growth in retail with MILKLAB. Our plant-based milk segment, led by MILKLAB, delivered 2.4% sales growth, with focused investment to strengthen the MILKLAB brand further. Dairy nutritional segment achieved a fourth consecutive year of earnings improvement, driven by favorable commodity pricing for bulk cream. Higher value dairy, including lactose free and protein fortification, continues our confidence in the dairy nutritional segment.
Safety, quality, and capability improved through the operational investment, leadership development, and digital systems. Our business portfolio has a nice balance. Dairy and plant-based milks lead the way, with sports nutrition on-trend. Nutritional ingredients with bulk cream and lactoferrin remain critical products in our portfolio. Nutritional ingredients showcases our specialty dairy products and maximizes the value of all milk components. Our contract manufacturing, especially in dairy nutritionals, allows us to rebuild our dairy portfolio. Our contract manufacturing, especially in dairy nutritionals, gives us scale and enables us to connect with key customers domestically and internationally. We are pleased with the balance of our portfolio. Our brands deliver over 70% of our contribution margin. We are in a position to invest in our brands, and this year was a year of investing back to grow awareness and consideration, especially for MILKLAB.
We have streamlined our sports nutrition category, with Vital Strength and Uprotein now the core brands. The delivery of another year of improved EBITDA performance has enabled us to invest into the future. I am pleased to announce that an EBITDA of AUD 61.8 million, up 7.6% from last year. Revenue rose 8.8% to AUD 648 million. Record sales for plant-based milks of AUD 186.3 million, up 2.4%. EBITDA of AUD 43.1 million was down 14.2% on FY 2025 after a step up in marketing and capability. Dairy Nutritionals EBITDA of AUD 21.6 million is up 94.1%, supported by commodity price tailwinds. Strong branded revenue growth, with MILKLAB up 5.5% and Australia's Own up 12.3%. Uprotein, our dedicated e-commerce brand for sports nutrition, was up 18%, and Vital Strength was up 11.6%. Cash generated from trading of AUD 69.1 million is up 3.2% on FY 2025.
The investment into our brand, together with challenging conditions in the second half with consumer spending and a global conflict, has slowed our earnings in the plant-based segment. Slide eight has the financial highlights that further call out the operational metrics. The statutory net loss after tax of AUD 67.2 million includes AUD 91.8 million for the convertible note fair value adjustment. This is an improvement from FY 2025 of AUD 82.8 million. Without these items, net earnings would have been positive. I have already called out a number of highlights in revenue, but there are a few others to mention. Australia's Own has grown 37% as we look to value-added opportunities, especially in flavors and kids milk. Exports of plant-based milks was up 9.8%. MILKLAB Oat has continued to grow with 20.3% over the last 12 months.
Bulk cream has increased 33.5% compared to FY 2025 with strong demand, and we are seeing this slow into FY 2027 as demand has softened and global commodity pricing has reduced, especially for milk fat. Demand for protein, on the other hand, remains firm. Targeted investment, growth in defending our position. We are proud of the visibility that we have achieved. No other barista competitor in the market has a portfolio diversity across plant-based and dairy milks that MILKLAB does. We launched our new campaign, Made for Baristas, Made for You. We also invested more heavily in trade shows, both locally and internationally, showcasing MILKLAB as a premium global brand to the trade. Innovation is key, and our retail performance was further bolstered in Q4 with the launch of MILKLAB new best-tasting soy and lactose-free products. The team have focused on embedding our new CRM tool.
For our international team, FY 2026 has been a standout year with market activations, training programs, and collaboration with key international distributors and retail partners. The team at Noumi are critical to our success. We have grown the team further this year as we increased our touchpoints, especially for sales and innovation. Safety has been a big focus again during the year. We launched our Safer Together program, and it is a commitment to protect, support, and uplift each other. Ingleburn has surpassed 500 days without a lost time injury. This year, we have also seen our total recordable injury frequency rate reduced by over 30% to 5.2. There is still more work to do, but the trend continues to be positive. The engagement survey saw an increase in participation, which is the third year running. It is a great result, with over 90% of our staff participating.
During FY 2026, we had over 100 leaders at Noumi complete the leadership training program to build the skills of our leaders. We continue to operate two manufacturing sites in Australia, Shepparton, close to Dairy Heartland, and producing long-life dairy milk and nutritional ingredients. Ingleburn produces our plant-based milks and liquid stocks range and our consumer nutritionals portfolio. Ingleburn also hosts our group services, which assists in better collaboration within the overall business. On slide 13, I'll talk to our Healthier Tomorrow plan. Our ESG strategy is integrated across our value chain. From dealing with our supply partners, to manufacturing, to delivery of our products to our customers, we are continuously improving processes to meet our ESG targets. In FY 2025, Noumi developed new sustainability targets, longer-term goals, and reporting methodologies to ensure environmental stewardship will stand the test of time, and also being financially sustainable.
In the annual report that we released today, we detailed our progress, and I'd like to update you on a couple of our achievements. During FY 2026, we donated over 130,000 liters of milk to the Shepparton Foodshare and also the Shepparton community during the Victorian bushfires during the summer. We've replaced all plastic straws with paper-based straws for products sold in Australia. Where feasible and commercially viable, plastic-based packaging will contain 50% recycled content by 2030. As called out earlier, our people are key, and our values drive our team. We continue to invest to build the capability. During the year, we also introduced the CEO Excellence Award, with seven individuals and a team being recognized for their contribution. This was a great new initiative, and the recipients were grateful for the recognition. Being able to recognize individuals that go above and beyond is uplifting for the whole team.
As you can see, we are embedding ESG practices across all parts of the business. This year, we've also completed our first climate report, aligned to AASB S2, and you can find that in the annual report that we released today. Our strategy was refined in FY 2025 and is delivering results. Our focus is clear, and I'll talk to key focus areas in each of the segments. In slide 16, I'd like to discuss the strategy for plant-based milk segment. The focus areas are very clear. We have refreshed the MILKLAB brand identity, celebrating the roasters, baristas, and cafes behind its 10-year journey. The team have worked on developing an improved MILKLAB formulation with leading roasters and baristas to improve flavor, stretch, and texture. Continuing to focus on MILKLAB growth in the Asian markets through stronger brand execution and distributor partnerships.
Targeted investment to expand MILKLAB brand beyond traditional hot coffee into iced drinks, matcha, chai, and other cafe-led occasions, attracting new consumers. Continued retail focus to leverage channel momentum supported by NPD and innovation. Our focus is to continue to grow MILKLAB beyond our shores and build it to be a globally recognized brand. In Dairy Nutritionals, we are building on the improvements we have achieved. Investment continues across the segment, including new ultrafiltration capability commissioned at Shepparton. Continued expansion of dairy product lines to support sustained growth. Improving production performance, product mix, and value extraction from each component of milk processed. Prioritizing areas of the segment with the strongest potential to build sustainable long-term value. Consumer nutritionals centered on value-added dairy, specialist nutrition, and branded products supported by innovation and operational discipline.
We are seeing the rewards of the investment and capability with dairy nutritionals contributing meaningfully to the overall business on a consistent basis. I will now hand over to Iain to take you through this year's financial performance.
Thanks, Michael, and good morning, everyone. Moving to slide 19 and starting with the headline numbers. Net revenue for the year was AUD 648.4 million, up AUD 52.5 million or 8.8% on FY 2025. Within this, total MILKLAB brand sales across both plant and dairy segments were up 5.5%. In contrast to prior years, export long-life dairy sales saw strong growth, up 49.4%, and bulk cream saw sales up 33.5%. Adjusted operating EBITDA came in at AUD 61.8 million, up 7.6% on the AUD 57.4 million we reported last year. It is worth noting that the result was achieved despite an estimated AUD 2 million impact from unrecovered costs and lost sales due to the Middle East volatility in the second half. Also worth noting that when Michael and I refer to EBITDA in this presentation, we are referring to adjusted operating EBITDA, which excludes abnormal items, restructuring costs, and non-trading expenses.
This is the measure we use and the directors use as the primary measure for assessing the underlying financial performance of the group and its operating segments. Looking at the segment mix, the improvement in dairy nutritionals was supported by favorable commodity prices on cream. While the plant-based milks result reflects increased brand and marketing investment we made, Michael touched on that a moment ago. Below the line, non-operating items reduced to AUD 8 million from AUD 14.8 million last year, and net finance costs, excluding the convertible notes, improved slightly to AUD 19.5 million. That gets us to our pre-tax earnings before the fair value adjustment on the convertible notes and impairment charge of positive AUD 26.3 million, up from AUD 12.4 million in FY 2025.
As you will be aware, there are non-cash accounting adjustments in relation to the fair value of the convertible notes, with AUD 91.8 million impact this year, and cash payments in relation to the notes of AUD 15.2 million for the year. In addition, in FY 2026, there was a small impairment charge as a result of the decision to wind down the Crankt brand over time, and is compared to a significant AUD 50 million impairment in the dairy nutritional segment last year. Taking all of that together, the statutory net loss after tax was AUD 67.2 million, an improvement of AUD 82.8 million on last year's AUD 150 million loss. Turning to slide 20 and the segment detail, and starting with plant-based milks. Net revenue grew 2.4% to AUD 186.3 million, a record for the segment, while adjusted operating EBITDA was AUD 43.1 million, down 14.2% for the year.
The EBITDA decline was largely driven by the step-up in brand and marketing investment behind MILKLAB that Michael described into key channels and markets. MILKLAB plant-based revenue grew 4.1% to AUD 126 million. As Michael touched on, we did see some softness in HORECA in the second half, which was down 5.5% in the half and down 1.6% for the full year. But that was more than offset by gains in retail and export. MILKLAB's domestic retail performance continues to build momentum, up 44.6% on last year, and now represents 17% of MILKLAB's Australian sales. On the private label side, plant revenues were up 1.9% overall, although Australia's Own Plant was down 14.8% following some ranging changes in retail. Total export, plant-based export sales grew 9.8%, including growth across our strategic markets. Moving to slide 21 and dairy nutritionals.
This is now the fourth consecutive year of earnings growth for the segment. Net revenue is up 11.6% to AUD 462 million, or 14.8% excluding traded milk. Adjusted operating EBITDA nearly doubled, up 94.1% to AUD 21.6 million. The standout driver within this was bulk cream, with revenue up AUD 14.3 million, or 33.5%, on favorable commodity pricing and a 9.1% volume growth. As most on the call will be aware, commodity pricing is cyclical, and I would flag that we do expect returns on cream to moderate in FY 2027 from the levels we achieved in FY 2026 based on commodity price movements. As I mentioned, export long-life milk revenue was up 49.4%. In FY 2026 represented 40.4% of total long-life dairy revenue, up from 30.2% last year. MILKLAB Lactose Free also grew up 11.1%. Nutritional ingredients revenue rose 22.5% on strong protein pricing, ingredient demand and favorable pricing outcomes.
Consumer nutritionals revenue was up 6.1%, with good brand growth in Uprotein at 18% and Vital Strength up 11.6%, although higher protein input costs did weigh on margins in that part of the business. Turning to the balance sheet on slide 22. We closed the year with cash at bank of AUD 15.3 million and undrawn facility of AUD 10 million. It should be noted that the financial statements are prepared on a going concern basis, with a material uncertainty identified, and that is due to the convertible note maturity in May 2027, as well as the revolver facility maturity in March 2027. Financial debt, excluding the convertible notes, was AUD 63.7 million, which includes the revolver, debtor financing, and equipment leases. Our AASB 16 lease liabilities principally relate to our Shepparton and Ingleburn sites. The convertible notes are carried on the balance sheet at fair value of AUD 517 million.
Important to call out that the fair value of the convertible notes as a financial instrument for financial reporting purposes differs from the redemption amount, which I will cover on the next slide. Taking all of this together, total assets were AUD 238.8 million against total liabilities of AUD 761.7 million, leaving net liabilities of AUD 522.9 million. One final point, as is standard, the MILKLAB brand value is not recognized in our balance sheet given it is an internally developed brand. Slide 23 sets out our capital structure in a bit more detail. The revolver finance facility was drawn to AUD 36 million against a AUD 46 million limit, maturing in March 2027. The full recourse debtor finance facility was drawn to AUD 13.9 million, and equipment finance leases were AUD 14 million. That gives net debt before convertible notes of AUD 48.7 million. The convertible notes themselves issued in two tranches in FY 2021 and FY 2022.
They've got a common maturity in May 2027, and the terms of those notes remain unchanged. At redemption value, the notes stood at AUD 622 million as at 30 June, which brings total net debt on a redemption value basis of AUD 670.7 million. On that basis, gearing is currently around 10.9x EBITDA post AASB 16. As has been outlined in previous releases from Noumi, the maturity of the convertible notes remains a key issue for the company to address, with the revolver also maturing in March. I'll leave it to Gen to cover the scheme implementation deed shortly. Turning to cash flows. Cash generated from trading was AUD 69.1 million, up AUD 67 million from last year, reflecting the improved trading results. Net finance costs were AUD 18.3 million, and we spent AUD 8.5 million on property plant and equipment, with CapEx spending remaining carefully managed.
On legacy items, we had U.S. litigation settlement and other litigation costs of AUD 9.8 million, partially offset by a AUD 6.7 million security deposit release for a net legacy litigation outflow of AUD 3.1 million. We also incurred AUD 3.5 million on transaction costs relating to finance activities during the year. Taken together, that's a cash base movement in net debt of AUD 35.7 million, comparable to AUD 34.6 million last year. To outlook. Noumi enters FY 2027 with a stronger operating platform and deeper capability. That said, the external environment remains unsettled. Commodity price movements, input cost volatility, currency shifts, and changing consumer demand will continue to influence our markets, and we expect competition to remain intense. Some of the benefits from our FY 2026 investments will also take time to emerge. We are confident about the investments in the business and the progress being made.
However, given the regards to the ongoing volatility and the nature of its markets, Noumi will continue its practice of not providing financial guidance. I'll now hand over to Genevieve, who will touch on the scheme implementation deed.
Thank you, Michael and Iain. Today, I'm speaking to you about the transaction we announced on the 21st of July earlier this year. As has been flagged, Noumi is required to pay approximately AUD 610 million of convertible notes in May 2027, as per the existing terms. Also, the senior bank facilities will be expiring or maturing in March 2027 as well. As Pat flagged previously, a thorough 12-month strategic review that assessed sale, recapitalization, refinancing, and note extension or amendment options was undertaken. The board found no committed alternative able to address the maturity or deliver comparable value to security holders other than the Arrovest offer. On the 21st of July, Noumi signed a binding scheme implementation deed with Arrovest, its major shareholder and largest convertible note holder, to acquire the shares and listed options that Arrovest does not already own.
Arrovest purchased certain convertible notes in July 2026 after the 21st July market announcement by the secondary market. It now holds approximately 83.4% of the convertible notes on issue. Most of the remaining convertible notes continue to be held by an Australian institutional investor. These notes were acquired at a discount to the redemption value and were private secondary transactions with no consideration payable to or by Noumi. If the schemes become effective and are implemented, shareholders would receive, I apologize, cash consideration of AUD 0.1234 per share, which is a 30% premium to the 30-day volume-weighted average price at announcement, and option holders would receive AUD 0.002 per option. This provides cash certainty ahead of the AUD 610 million note redemption, which ranks before equity in the capital structure. Also as announced, Noumi's current debt obligations, including the notes redemption amount, are approximately AUD 703 million.
The transaction value, including the equity amount on 100% basis, the full note redemption amount is approximately AUD 737 million. The independent expert report, which will accompany the scheme booklet, will provide an independent assessment on whether the schemes are in the best interests of the relevant security holders. Security holders should read the report in full before voting. The independent board committee, or IBC, unanimously recommends voting in favor of the schemes, subject to there being no superior proposal merging, and the independent expert concluding, continuing to conclude that the schemes are in the security holders' best interests. The IBC comprises directors independent of Arrovest, who have been supported by legal and financial advisors in assessing the proposed schemes. The IBC recognizes that the proposed schemes may crystallize a significant loss on their investment for some shareholders.
The IBC judges that the Arrovest offer has the best available outcome for security holders in the circumstances Noumi faces. Just to reiterate, there is no action that is required at this point. The scheme booklet, the independent expert's report, are expected to be sent to shareholders and option holders in early October, as detailed in the indicative timetable on the 21st July ASX announcement. Thank you for attending today, and I'll now hand it back to Mike.
Thanks, Iain, for the summary of the financial results for the year and providing the outlook. Also, thank you to Genevieve for the summary of the scheme implementation deed. That concludes the formal presentation, and we're available for any questions from shareholders. As a reminder, questions can be submitted by pressing the Q&A icon. This will open up a new screen, and at the bottom of that screen, there is a section for you to type in your question. Once you have finished typing, please press Enter on your keyboard to send through your question. You can also type in that you'd like to ask the question verbally and we'll unmute your line. I'd like to reiterate a few points to summarize. We are focused on service, quality, and innovation. In plant, we continue to grow in range, channel, and internationally. Dairy Nutritionals delivered a substantial improvement in FY 2026.
More reliable production, disciplined product mix, and a focus on getting more value from each component of milk, producing more consistent results. We enter FY 2027 with a stronger operating base and a broader set of opportunities. Our focus remains on building MILKLAB, growing higher value dairy in Nutritionals, and maintaining discipline on a competitive environment. Just wondering if there's any questions. We have a verbal question from Garth Francis. Moderator, could you unmute Garth Francis, please?
Good morning, Genevieve, Michael, and Iain. Thank you for taking my question. I just wanted to ask a couple of questions just centered around the individual divisions. You mentioned the bulk cream pricing struggling and the strong volume growth, but then just we're cautious on the outlook. Are you implying there that the sales will slow or that the sales will go backwards? If you could just sort of give a little bit more clarity on what your expectations around bulk cream are.
Yeah, I can cover that one, Garth. As we outlined, commodity prices generally quite cyclical, as you'd be aware, Garth. We've benefited in FY 2026. We had increased volumes, about 9%, and our revenues from bulk cream were quite a bit higher than that, 33.5%. What you can work out from there, we obviously sold some more bulk cream, but also we benefited from commodity pricing. What we're calling out is, we're anticipating through that cyclical cycle that some of that pricing benefit that we realized in FY 2026 will moderate. A lot of activity has gone on during FY 2026 to maximize the value of all of our components. In terms of seeking higher value contracts, the contracting volumes, rather than simply being at the mercy of spot.
We do have some mitigations, but anticipate that that cyclical nature of the cream pricing will come off from the levels that we've seen in FY 2026.
Great. Thank you. Then just maybe staying in that division. In farmgate milk pricing, the surcharges were put in when the Middle East conflict kicked off. Some of that is rolling off. It looks like supermarkets are now walking back some of their price increases. Can you just maybe walk through what that means for UHT retail sales?
Garth, when we look at the contracting period, the milk price from previous year was fairly flat, consistent year on year, and those prices, those support packages are starting to roll back. I cannot specifically comment, but we have not seen any changes to date on shelf price regarding any movement there. We still have increased fuel costs on shelf as well. Not seeing any changes on shelf at this point in time for our milk-based beverages.
Yeah. Thank you. Then just on the marketing spend in the plant-based division. You highlighted the need to defend and grow. Will you step up the marketing for 2027, or is that investment largely made and it is a standard run rate from here? What is your expectation then for the opportunities, part of what you had called out? I think you were underrepresented in some states, with products.
In terms of the investment we made last year, we will continue to carry that somewhat flat for the coming period. It is a category where there is a lot of competition as well. We have seen our brand awareness increase over the last 12 months. It is something there, as a market leader for MILKLAB, we are going to continue to invest in that, in the brand recognition domestically and internationally to grow the brand.
Terrific. Then, you highlighted the soy formulation that has been released. It has been evident that it is on the shelves as well. Are you benefiting? How are the sales of the soy tracking when you compare to oats? Does that give you the opportunity to bundle into HORECA channels where you previously couldn't?
As we sort of called out through the call, we do have a broad range, because we also have our macadamia and coconut and the dairy-based products under the MILKLAB brand, which is something unique to Noumi. So being able to bundle those products in the HORECA channel is very beneficial as we support those outlets with products and also merchandise. So it is very early in terms of our soy ranging in retail, but we also do get ranging of MILKLAB Lactose Free in there as well. So we do see the strength of being the leader in the barista space for plant-based continuing to benefit from an improved formulation.
Terrific. If I might slip in one more. The CapEx stepped up in 2026. Is the budget for 2027 similar? It stepped up to AUD 8.5 from AUD 5, I think. Is that the sort of level that we should think about it for FY 2026? Sorry, 2027.
Yeah. As I mentioned, Garth, CapEx continues to be pretty tightly managed. In terms of how you should think about it, similar sort of level would be sort of appropriate, Garth, given where we are in terms of cash position, et cetera.
Terrific. Thank you. No further questions at this time.
Being that there is no further questions there, I want to thank everybody for listening today, and reiterate the execution of the strategy of Noumi. The results we are delivering today are a testament to that. Right across the business, including with all, we remain confident to the pathway forward. I want to thank all stakeholders within the business. Our team have been instrumental in our success. We would not be here today without them. I want to thank everyone for their effort. Thank you all again for your time today, and hope you all stay safe.