Thank you, Andrew. Good morning, everyone, and thank you very much for joining Peter Warren Automotive Holdings FY 2025 results briefing. My name is Andrew Doyle, your Chief Executive Officer, and I'm really pleased to be here this morning. Joining me is our Chief Financial Officer, Victor Cuthell, who will assist me in presenting our results. This presentation, along with the financial statement, has been lodged with the ASX. For your information, it can also be found on our website. On slide 2, you'll see today's agenda for our presentation, and I'll begin with a summary of our FY 2025 results before turning to the road ahead and the broader trends shaping the automotive industry, and then into our new Peter Warren strategy and the opportunity ahead for Peter Warren. Victor will then provide more detail on our activities during the year and take you through our FY 2025 financial performance.
We'll finish then with an update on our outlook, and of course, be happy to take your questions. Let's move then to the FY 2025 results overview. On slide 4, we start with our total revenue, which came in at just under AUD 2.5 billion for the year, slightly ahead of FY 2024. This was mainly driven by a decline in the new car market, mitigated by a strong performance in used cars, F&I, service, and recent acquisitions. EBITDA was just over AUD 110 million, and we delivered underlying profit before tax of AUD 22.3 million, in line with guidance we provided in July. This was on the back of a much stronger second half performance, with PVT of just over AUD 15 million, more than double the level of the first half. Customer demand for new vehicles was down substantially in the first half as consumers faced cost of living pressures and higher inflation.
It is important to remember that the prior year represented the peak of the post-COVID trading rebound. However, the second half saw a return of some typical seasonality as customers responded well to our end of financial year marketing campaigns. Margins have remained stable, and we certainly benefited from our disciplined inventory management, down to AUD 351 million. Our previously disclosed cost-out program, a AUD 4.9 million saving in the second half alone, and growth in our other, more controllable revenue streams. We enjoy a very low net debt of just AUD 46.7 million, AUD 14 million less than the year prior due to our ongoing capital management discipline, and we maintain a strong and a robust property backing with AUD 229 million in property assets, representing a net debt to property of 20%. I'll turn now to slide 5, which lays out our key operational highlights.
Critically, we have implemented clear targets and incentives for key management in the dealerships and the head office, which has driven the right accountability, the right behaviors, and performances overall. Looking at the top left chart, over the year, we have successfully reduced new vehicle inventory from AID 382 million-AUD 351 million, or by more than 8%, or around $30 million. That's reflecting our disciplined intake of the right level and the right mix of stock, matched with the concentrated liquidation of any oversupplied stock. As a result, our new and demo inventory balance at the 30th of June 2025 represented just 59 days' sales versus 61 days at the end of financial year 2024.
Moving now to the chart to the top right, you can see our proactive evolution of our brand portfolio at Peter Warren, and we strongly believe this is the key to our future success. We have purposely pivoted the business to the changing industry dynamics, to now have a sizable uptick in the partnership with Chinese brands, especially in the last two years, with now around 20% of our represented brands being strategically chosen Chinese brands. In almost every case, these brands and dealerships in which they operate have been added into operations with AUD 0 goodwill and within our existing property portfolio. Although these brands are still only very new to the market, in some cases only for a matter of months, really, we can already see a very fast consumer acceptance of the compelling price and price offers.
For example, in one of our more established markets, say New South Wales, in the peak month of June alone, we saw Chinese brands represent around 11% of our volume already, and they're only getting started. It is, however, important to reiterate that we hold key legacy brands, obviously representing 80% of our brand portfolio, which are extremely strong players in the marketplace, including Toyota, Mazda, Ford, Kia, Hyundai, Isuzu, Volkswagen, Audi, Mercedes, Benz, just to name a few. We hold long and strong relationships with these brands and see a continually growing relationship together over the coming years. Moving to the bottom two charts, here we can see the impact of our cost-out programs mentioned to you in previous briefings. We have successfully found efficiencies in our headcount to operate at a level 4% lower than the year prior.
Despite a still relatively high level of inflation, we've managed to reduce our costs by around AUD 5 million in the second half alone. It's important to note that both the headcount and the cost-out reductions we have made have not come at the expense of customer care or our operating performance levels. Let's now take a look at the plan and the key strategies ahead for Peter Warren. Returning to page 7, before we determine our going-forward strategy for the company, it is important to recognize where our industry is heading. The sector continues to undergo a transformation, and we at Peter Warre n are ready, willing, and excited for this change. I firmly believe it is the companies that have the scale and the ability to adapt quickly that are best positioned to outperform.
We've seen battery electric vehicle growth stall while plug-in hybrid and hybrid vehicles continue to gain traction. NVEZ or the New Vehicle Emissions Standard , is just commencing, and there is uncertainty in the early days, just as we've seen in other global markets, around the reality of the specific targets, ambitions, and the timeframe set by the government. Meanwhile, competition continues to intensify with an increasing number of new brands, which in turn keeps some margin pressure elevated. The market is being saturated by new OEMs with up to 90 brands anticipated, more than any other mature auto market globally. There will certainly be winners and losers, therefore backing the right brands has never been more important. Meanwhile, rapid product innovation means better technology and a wider range of choice and value for money for our customers.
The industry is certainly seeing more vendors open to M&A discussions, as their businesses are simply not equipped to deal with this level of change and consolidation in the industry, which is expected to intensify. Therefore, for dealers, these shifts carry clear implications. It is critical that we run a very well-balanced business, controlling the performance of these elements that we can control better, such as used cars, where we can individually buy and sell at optimum levels, or service and parts, and F&I, for example, where we can further penetrate existing sales and existing market car park. In doing so, we control more of our debt sitting, and we're therefore better hedged for the normal NisCar market supply and demand cycles, and pricing are less in our control or out of our control.
Just like we have seen in the automotive markets of North America and Europe, further consolidation is expected, with bigger, better, probably fewer dealers who can implement the right mix of a top performance culture with the size and scale to grow with proven efficiencies and capital to reinvest in innovations and technology to further drive more efficient returns. What doesn't ever change with the transformation is the key focus on the customer. The customer is always king, no matter the industry. The customer has more choice of brands than ever before, and at Peter Warren, we must constantly strive to grow our market share and implement the discipline to earn the loyalty of the customer for constantly improving retention and therefore lower acquisition costs going forward. Moving to slide 8, those are exactly the attributes that form the foundation of our revised strategy.
We never rest, and we want to build on today's success for tomorrow's bright future. Our vision is to be Australia's most valued automotive group, but benchmarked against also global peers, one that consistently exceeds the expectations of our customers, our employees, our brand partners, and of course, our investors.
We're pursuing this vision through four interconnected pillars of focus: innovation, where we dedicate ourselves to really think today how what we do will drive tomorrow's success; the customer, of course, remains at the heart of everything we do; and at Peter Warren , we drive a true customer-centric culture in all of our activities; organic, where we are restless to do better today than we did yesterday through clear transparency of results and a clearly communicated best-in-class performance drive; and finally, acquisitions, where we have a strong appetite for appropriate, opportunistic, and disciplined expansion through new brands, new sites, and new businesses. These will be executed thoughtfully, supported by our diverse product portfolio and our property-backed balance sheet. We firmly believe this will provide the right foundation for driving long-term growth for Peter Warren .
As you can see, underpinning all of those actions, we will live our Peter Warren values of growth, integrity, focus, and teamwork. Turning to page 9 and putting a little bit more meat on the bones about what we mean there about key focus areas and outlining the opportunity for Peter Warren , we plan to deliver our strategic pillars and, critically, the benefits these actions will deliver for all of our stakeholders. There is no question, like any industry, innovation will be a key enabler of our long-term competitiveness. At Peter Warren, we have a very strong appetite and are actively applying new technology and piloting both automation and AI to improve efficiency, lower costs, and lift customer service.
For example, we're already driving automation with our live service tracker, which improves the lives of our customers but also our service advisors in our dealerships by allowing customers to track the status of their vehicle when it's in service in real time. Think of, for example, the pizza timer app. Providing this information through our customer portal has seen a substantial drop in phone calls to the dealerships inquiring about the status of the service vehicle, allowing our service advisors in our dealerships to work more face-to-face with customers in the dealership rather than emails and calls, and additionally enhances the customer experience through what is perceived as better transparency and trust.
If we think about actual AI applications, we also have a great trial right now with SalesLead Solutions, which is a dedicated AI tool designed to nurture sales leads and facilitate quick, responsive, and thoughtful customer interactions by automating the follow-up process and providing immediate, timely, and personalised responses to inquiries, therefore ensuring that our potential customers receive the attention they need at every stage of the journey to keep them warm in our sales funnel. Importantly, this AI tool then allows our sales staff to focus their expertise on more efficient sales tasks, face-to-face interactions, closing deals, and of course, building relationships rather than being tied down by routine administrative communication, which is typically not enjoyed by most salespeople. These are both great real-life examples of efficiencies that are already in our business in a pilot stage but with scope to further roll out nationally.
Rather obviously, with innovation, we expect to see the benefits through improved people efficiencies, operating leverage, customer insight to accelerate the top line, and ensuring that we're ahead of the curve for changing customer preferences and industry change. We do not intend to talk to people efficiencies with these trials, but we believe we can benefit exponentially by, first of all, having our professionals in our business more engaged with people and performance in their day-to-day rather than administrative tasks that don't add great value. Secondly, by negating the need for continued employment of many further administrative roles or analyst roles into the future. We continue to invest in the customer-centric culture through training and development programs to strengthen our relationships, drive retention, and build repeat sales and service, thus lowering future cost of acquisition.
This success in turn deeply improves our OEM relationships, our brand relationships, and recognition, thereby driving more opportunities for us into the future. Organically, we're focused on improving performance through cost management, inventory control, and unlocking more value from used cars, service, parts, and finance. Through a culture in our business of transparency and inclusion, these benefits are clear in terms of the operating performance and ensuring that our 80-plus sites have both a higher performance overall, matched with a lower distribution span of those performances. Finally, acquisitions remain an important growth lever, and we will always be disciplined in our approach, both focusing on adding the right brand, optimizing our site footprint, and ensuring that any acquisitions provide us with strong synergies and enhance our earnings. Together, these priorities create a pathway to stronger revenues, improved margins, and ultimately, long-term value for our shareholders.
With that, I'd like to now hand over to Victor to go into more detail on our financial performance. Victor.
Thanks, Andrew. Good morning, everyone. I'll start on page 11 with an overview of our main revenue streams. FY 2025 was a year when we benefited from the breadth of our revenue streams. In new cars, we weren't immune to the industry-wide decline in sales from post-COVID peaks. To mitigate this, however, we were very successful in driving growth in used vehicle sales, which were up 14% to 9,702 units. Our service and parts business is the higher margin area, and we grew that to a revenue of AUD 422 million, up 4% on the previous year. As you can see, our graphs on the screen show the strong growth achieved in recent years in these areas, and we'll be working hard to grow these into FY 2026. Turning to page 12, our summary P&L gives a good overview of the year.
We had a decline in new car sales and a decline in new car margins, and those did have a significant impact. We worked to mitigate those with organic growth in used cars, in service, in parts, in finance, and in insurance. We also got a benefit from our acquisitions in late FY 2024. This was the year in which our goal was to try and offset that new car decline, which occurred across the industry. Our P&L shows we got our revenue to a break-even position at + 0.3%. Our gross margin reduced by 0.8 percentage points, from 16.9% to 16.1%, and I'll talk more about that on the next page. The good news is that this margin has stabilized in the last six months. Our OpEx went up by AUD 6.1 million, but that includes a AUD 12.5 million increase due to acquisitions.
After taking account of those acquisitions, we had a net OpEx reduction. I'll dig into our overheads and what we've been doing to manage our costs in a few moments. Our underlying PVT for the year ended at AUD 22.3 million, which, as Andrew said, was in line with our guidance. Our H2 was significantly higher than our H1. As we go into FY 2026, we're pleased to start the year with lower OpEx, lower inventory, and lower run rate interest costs. Turning to page 30, we have our gross profit. As I mentioned, our gross margins have stabilized and were consistent in the first half and the second half at 16.1%. The bottom graph shows this was down slightly from 16.3% in the second half of FY 2024. The top graph shows the year-on-year decline from 16.9%, which was caused by new car margins.
Since early FY 2024, there has been more competition between brands, more new entrants, and a full supply of inventory into Australia. The impact of this on us as a dealer varies considerably from one brand to the next. In some brands, we've seen margins holding up, and in other brands, we've seen a decline. However, we're focused on maximizing our opportunities, and outside of new cars, we've seen favorable margins in our other service lines, including service, parts, finance, insurance, and used cars. We've had a big focus on growing revenue in these areas, and this improvement in revenue mix has helped our overall margin. As we move into FY 2026, our gross margins have stabilized, and we will be continuing our work on margin accretion programs in the year ahead. Now to page 14, which shows our operating cost bridge.
During the year, our costs increased from AUD 283.6 million-AUD 289.7 million. As you can see, all of that increase was a result of our acquisitions, which added AUD 12.5 million in OpEx. After taking account of those acquisitions, we were pleased to achieve a net cost saving. We achieved lower headcount, lower commissions, and we implemented a wider set of cost-out actions. These helped us to achieve a AUD 6.4 million reduction in costs. When we compare the second half to the first half, we had a period where we had no acquisitions that impacted that comparison. In that period, we saw an absolute reduction in overheads of AUD 4.9 million. Of course, if you take inflation into account, the real savings are larger than appear on this page. Going forward, we're very focused on our costs, and we'll be continuing that during FY 2026.
Turning to page 50, which shows our cash flow statement with operating cash flows of AUD 93.7 million after flow by interest. This reflects lower EBITDA compared to the previous year, and it shows our cash conversion remains strong at 86.4%. After taxes, loan interest, and other items, we generated cash of AUD 46.4 million, and this supported a balanced allocation of funds across three areas: investment CapEx of AUD 10.6 million, which was mainly in our dealerships, shareholder returns via dividends of AUD 14.7 million, and debt repayments of AUD 11.7 million. Our debt repayments enable us to bring our net debt down to AUD 46.7 million. We're delighted to achieve that level, which is a 20% loan-to-value ratio on our property. That net debt also represents about 0.6x EBITDA after flow by interest. We also have a strong cash position going into FY 2026.
As Andrew mentioned, the directors have declared a fully franked final dividend of AUD 0.04 per share, taking the total dividend for the year to AUD 0.056 per share. I'll now hand back to Andrew, who will take us through the outlook for FY2026.
Thank you, Victor. To close with an outlook for Peter Warren , the new car market is expected to remain highly competitive, with new brands competing for market share. We expect to continue to grow higher margin service lines in service, parts, finance, insurance, and aftermarket. We certainly expect to grow our earnings in FY 2026. As you can see, the clear management focus areas coming from our strategy are listed below. We continue to build our customer-centricity culture. We drive our performance culture discipline. We have a strong curiosity and appetite for innovation investment. We continue to build on our brand portfolio development. We enjoy the ability to be able to utilize low net debt for opportunistic yet disciplined M&A. We focus on strategic capital management, and we continue with our ongoing cost and inventory management programs.
The market is turning a corner with more stable new car volumes and margins expected to continue. We have been working extremely hard in the background to operate with an even more accountable performance culture and will continue to drive this culture. We have also now built the framework for our Peter Warren strategy, which has been well communicated to management and our teams. The teams know what they need to do. Indeed, many of the dedicated work streams are already getting strong traction. This sets a direction for earnings growth into FY 2026 and an even stronger, longer-term future for Peter Warren . On a personal note, I'm now just 10 months into this role, and every day I see so much opportunity for the future. We are only just getting started, and I really look forward to bringing you positive development updates into the future.
We're really thankful for those who have chosen to join us on this exciting journey, be they our wonderful employees and team, our loyal customers, or our shareholders, who we are focused on rewarding with ongoing performance and success. That concludes our presentation for today. As a reminder, there is more material in the appendices that are attached to the presentation deck, and I'd like to take the opportunity to thank our team for their resilience and their determination to deliver this great outcome overall. I'm thrilled to be part of the Peter Warren team, and I really look forward to updating you on our progress at the half year. Finally, to our investors, thank you for your continued support throughout this period and ongoing, and we appreciate your time today.
Victor and I would now be delighted to take any questions you may have, and I'll hand back now to Andrew.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you are on a speakerphone, please pick up your handset to ask your question. The first question comes from the line of Phil Chippendale with Ord Minnett. Please go ahead.
Good morning, Andrew and Victor. Thanks for your time and congratulations on a great second half. Just in terms of the used car sales numbers on slide 11 and that really strong performance, can you just unpack a little bit about what you think you've done better this year to drive that stronger outcome?
Morning, Phil. Yep, no problem at all. It's been quite a focus of the teams up and down the Eastern Seaboard. Most important in terms of our success there has been to acquire stock, to acquire the right level of stock, and to then maximize the opportunity we have, buying at the right price and multiplying that with a good return. As mentioned a couple of times, we have a good property portfolio and good spaces within our portfolio to be able to display a good level of used cars. For that reason, we've been able to improve our dedication there in terms of focus, but also improve our volume and overall ability to convert.
OK, thanks. I just want to talk a little bit about the OpEx improvement. On slide 14, you've got a useful slide that's showing the first half and the second half, and there's a AUD 4 million number in terms of people savings. You reference commission levels as part of that. How much of that AUD 4 million came from lower commissions? Where I'm going with that is trying to think about FY 2026, whether we should try and annualize that AUD 142 million from the second half to get to a full year number, and try to understand what that sensitivity is from the commission side of things.
Sure. We haven't disclosed the breakdown of the cost reduction, but I think directionally I'd say that a good chunk of that fall comes from the commissions, which is why we've mentioned it on the page. In terms of what that means for us going forward, we are delighted to enter FY 2026 with a lower cost number than we entered FY 2025. We are looking to continue to deliver cost savings and, of course, continue to work on more initiatives in FY 2026. What does that mean for the outlook for that number? In the round, I'd say that maybe the larger part of our cost-out actions have crystallized and delivered in FY 2025, maybe, I don't know, 70% of the benefit of the actions that landed in FY 2025. We'll still get a little bit in FY 2026. We have got inflation, of course.
We have got the award increase occurred on July 1, but we're still working hard, and we're still confident that we'll be keeping control of our costs in FY 2026.
OK, thanks. Just last question from me. If you could make a comment on business performance for the first sort of seven weeks of this year, I'm primarily interested, I guess, in those gross margins. Have they continued at that 16.1% level, or has there been any improvement? Just a little comment on that, please.
Yeah, I Phil the market has continued as expected, so no change to the last couple of months. Obviously, July and the seasonality perspective is often a softer month. Having said that, the reflex results were up around 3% overall. The market is still there, but margins have remained stable, as mentioned earlier.
OK, thanks. I'll jump back in with you.
Thank you.
Thank you. Next question comes from the line of Chenny Wang with Morgan Stanley. Please go ahead.
Good morning, guys. Thanks for taking my questions. Maybe just following up on the last question around gross margins. Obviously, you have had three halves of flat gross margins now, which I think is a good outcome after the reset that we've had. Clearly, there's still a lot of crosswinds in the market. I guess, you know, have we found a sustainable base for gross margins? How should we kind of think about this into 2026 and 2027?
Our view, as conveyed on slide 13, is that margins have stabilized, and we're seeing that continue into FY 2026. We've seen it occur over the last 12 months, and really, we saw it the six months prior to that. We're now into, what, 20 months of 16.1% and 16.3%. Out there on the dealership floor and also in engaging with our OEMs, we are getting messages that kind of lead us to the conclusion that that is a stable level of margins, and that's our outlook for FY2026.
Awesome. Maybe if I could just be a little bit more specific, I think it looks like new car margins are still bouncing around a little bit, but you know, as you kind of look around that piece into 2026, has that also stabilized, and what are the puts and takes we should be aware of?
The puts and takes that we are focused on really is driving the higher margin revenue streams. As you'd be aware, our finance, for example, is a high margin area where we have been able to increase our penetration and been able to increase our income per unit. Our service is another put, if you like, where we are able to drive a stronger margin, and we'll continue to focus on that. New cars is the area where, as you've said, there's competition in the market, and there's new entrants coming into the market, and that's the area that's been under pressure over the last couple of years. In the round, however, I'd probably come back to your first question, which is it's been pretty stable for, you know, 18, 20 months, and that's where we see it at the moment.
Awesome. Thanks, guys.
Thanks, Chenny.
Thanks, Chenny.
Thank you. Next question comes from the line of Tom Tweedi e with MA Moelis Australia. Please go ahead.
Good morning, guys. Thanks for taking my questions. Just one for me on the new vehicle sales. There's been some OEMs that have sort of directionally not aligned their model releases with demand. We've sort of seen a shift there. Audi comes to mind. It's been a bit challenging, but it looks like it turned around in the most recent reflex data. Can you just give us a sense, firstly, of over FY 2026, what of the OEMs' responses or what model lines are coming down that could benefit yourselves, you know, say a turnaround in underperforming brands to meet demand? You know, just a sense of what the order rate might be looking like already across those brands. Just a little bit more color there would be great. Thanks.
Good morning, Tom. Thanks for the question. Just to make sure I understood you correctly, you're talking about the product release cadence coming in 2026? We see some of our brands, especially the brands that I mentioned earlier, who've probably, to be fair, been at an average age of product portfolio that's older than they would have liked, releasing a number of new models over the next 12 months. There's quite some exciting new product coming. The important thing as well in the context of NVEZ is that the right mix of product comes through. We're seeing some good launch of new product coming, and that has a good, stable base. You can imagine some of the brands I'm talking about, they have a good customer base that will be very loyal and renewed. We're very confident about those launches.
It's about getting the mix right in terms of the propulsion. I mentioned earlier about battery electric vehicles, about plug-in hybrid and hybrid, and those have been, I think, well adhered to or listened to by the manufacturers in terms of making sure that mix is right, because we've seen in the past, of course, when they're out of the right level of mix, that can cause some stress in the market. I do believe they're fruitful discussions we've had with the OEMs about the forthcoming product launches. Your second question was about order rate, and our overall order rate has been stable. Obviously, we saw a good increase, as I said, towards the second half of this year and especially into the May-June period. I mentioned earlier that July, obviously, is seasonally always a bit weaker after the end of the financial year, and that was the case.
As we entered into the end of July and now the end of school holidays in July and then into August, we're seeing a good bounce back of activity. Overall positive.
Brilliant. Thanks, guys.
Thanks, Tom.
Thank you. Next question comes from the line of Brittany Issaka with Spheria. Please go ahead.
Can you hear me?
Yeah, the gas stage, Brittany.
Hey, how are you? I just wanted to touch on maybe just some of the new Chinese brands you guys have imported in 2025 and then also into 2026, if you could just touch on those.
Sure, no problem. You meaning specifically the brands we have?
Yes.
Yeah, no problem. The brands we have currently are LDV, MG, GWM, Leapmotor, Omoda, JAC, and Geely.
Can you disclose who you're onboarding for 2026?
No, not at this stage. No. We obviously are an expansion. That's the brands we have, and we're expansion with those brands into various locations at the same time. You will have noticed on that slide, I think there's six-plus brands, 14+ locations. We have the ability, which is very attractive to those Chinese newcomers, our property, and we can utilize our property and, as I mentioned, move into existing property with very little goodwill and obviously moving straight into the property we existingly have, the showrooms we have. It's really impressive, as I said in my presentation, the immediate uptick and interest from the market into those products. They are compelling. They are well accepted. As I mentioned, even in New South Wales in June, we saw somewhere in the order of 10%- 11% of our volume being represented by the Chinese brands.
Very encouraging, and some of those brands, as I said, have only been in market for six months, five, six months.
Great. Thank you.
Thank you.
Thank you. Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Thank you. There are no further questions at this time. I'll now hand back to Mr. Doyle for closing remarks. We have a question. Shall we take it? It's from Tristan Weght with Jarden. Please go ahead.
Hi. Thank you for taking my question. Firstly, I just have a question on the acquisition contribution in the second half and on like-for-like growth, and if you can disclose what that was.
We haven't disclosed the acquisition contribution to the PVT in our financial statements, but what we can say is we're delighted with the performance of our acquisitions. We had one in March 2024, and we had a couple of smaller ones in June and July. After financing costs of those items, we've had a very, very good contribution, which has assisted us in getting to our AUD 23 million. The second part of your question, sorry, I've just forgotten. Could you just repeat the second part of your question?
Just asking around like-for-like growth, especially for new and used vehicles.
Got you. Yeah. We haven't disclosed hard like-for-like numbers in our presentations and data, but what we can say is that we've had good like-for-like or ex-acquisition growth, if you like, in service, parts, finance, service finance, insurance, and parts. Used is the area where we've had very good growth that we highlighted on the slide. In new cars, we've had a decline, which is consistent with what's happened in the rest of the market. Overall, we're pretty pleased with where we've got to on an ex-acquisitions basis.
Yes, thank you. One last question on inventory. You manage inventory well in the second half, and it has come down. How do you think it's going to come down further in 2026, or how do you see that developing?
It's a constant focus for us. The most important thing, as I mentioned, hopefully you picked up in my words, was not so much the cleaning out of aged inventory, but more importantly, the clear and concise and appropriate pickup of new inventory. The mix and customer demand is most important. We'll continue that focus, which means we'll have less and less mismatch, if you like, of stock. Therefore, we believe we can be even more efficient in the future. It's a task that continues, and each of our management team are well aware of it and have it in their incentives and KPIs.
Thank you. That's all from me. Thank you.
Thank you. Thanks, Richard.
Thank you. There are no further questions at this time. I'll now hand back to Mr. Doyle for closing remarks.
Thank you, Andrew. Thank you for your time, everyone. We appreciate it. We're very excited for the future of Peter Warren . We're excited with the team you have, the brands we have, and the opportunities ahead. I really look forward to, as I know Victor does, seeing many of you in the coming days. Thank you again for your time, and we wish you all a great day ahead.
Thank you. That does conclude our conference for today. Thank you for your participating. You may now disconnect.
Thank you.