I was on the call and asked for FY25 guidance and trading...

I was on the call and asked for FY25 guidance and trading update. No guidance was provided. Adam said that the first few weeks of trading was in line with expectation. Did not mention what that expectation was.

The way I viewed the result was that they had too much inventory which was obsolete hence the write down. They just worded it nicely by saying it due to a change in strategy. Put simply, they screwed up with managing their stock due to a combination of reasons. Now they’re resetting everything and starting fresh.

They’re still on the premiumisation footpath. This year they forecast cashflow neutral as they have a large amount of grower payments to make but from FY26 this should unwind and they will see improving cashflows.

In simple terms, they brought the stock on credit last year, will pay for it this year impacting cashflow and will sell the stock next year and beyond driving cashflows.

Hence explaining the emergency capital raise to support working capital movements.

What I took from this call was that they stuffed up. They were expecting more turnover and less costs + asset sales but this didn’t materialise. They paid the price for drifting too close to the wind and along with the time and costs spent on the merger discussions with accolade this all came to a head when they were hit with the merger discussion stopping, sales below forecast and mismanagement of working capital.