Brambles Stock

Good morning, everyone, and welcome to Brambles Full Year Results Presentation for the 2026 financial year. I'll start with an overview of our FY '26 performance including financial highlights and our key areas of focus this year. I'll then cover the operating environment and our response to the repair capacity constraints that emerged in our U.S. business during the fourth quarter. I'll also provide an update on Brambles of the Future and Serialization+ before handing over to Joaquin for a more detailed view of our financial performance.

Let's start with a review of the highlights for FY '26. We delivered a resilient financial result while advancing the customer, operational and sustainability initiatives that strengthen our long-term competitive advantage. For the full year, revenue increased 2%, reflecting strong new business growth across the group and price realization. These increases more than offset lower like-for-like volumes from softer consumer demand in most regions.

Underlying profit increased 4% and including a USD 90 million adverse impact associated with U.S. repair capacity constraints. Excluding the U.S. repair capacity impact, underlying profit increased 11% and with price realization, cost management initiatives and productivity improvements more than offsetting inflation and strategic investments across the group.

Free cash flow before dividends exceeded USD 1 billion for the second consecutive year, demonstrating the progress we have made in reducing the capital intensity of the business. This supported the 16% increase in total dividends declared for FY '26 to USD 0.4615 per share.

Together with the USD 509 million of share buybacks completed in FY '26, this brought the total cash returns to shareholders to approximately USD 1.2 billion for the year. These financial outcomes demonstrate the benefits of our transformation over recent years and reinforce the importance of continuing to build the capabilities that strengthen our business and underpin the next phase of value creation.

During the year, we maintained our focus on what matters most to our customers, improving their end-to-end experience and investing in to deliver the quality, service and insights they need. In the U.S., we prioritized our customers by making the necessary investments to improve service levels and strengthen the network.

We also continue to modernize our network with automation and digital initiatives underway to improve resilience and efficiency while reducing the overall cost to serve.

Finally, we launched our 2030 sustainability program marking the next phase of our ambition to create regenerative supply networks. The program is focused on delivering nature positive outcomes and strengthening the communities and economies we serve.

Turning to the FY '26 operating environment, which was characterized by persistent inflationary pressures, subdued consumer demand and continued new business momentum in key markets.

Labor costs increased in all regions and were particularly pronounced in the U.S., where competition for blue collar workers increased significantly in a tightening labor market. Fuel and transport costs also rose significantly in the second half of the year, largely owing to the Middle East conflict. Transport inflation in the U.S. was further compounded by driver shortages with significant increases in spot rates for transport during the fourth quarter. Although lumber prices varied by region, the weighted average capital cost of our pallets increased by 4% on FY '25, largely due to the higher proportion of pallets purchased in the U.S. market.

In response to these inflationary pressures, we have maintained commercial discipline recovering input cost increases through a combination of contractual pricing, indexation and surcharge mechanisms. In Europe and Latin America, we have also introduced fuel surcharges and other pricing mechanisms to reduce the lag in recovering fuel cost increases.

In addition to strengthening commercial terms, we have continued to focus on productivity improvements and cost efficiencies to reduce cost to serve increases and deliver better value for our customers.

On the demand side, cost of living pressures and macroeconomic uncertainty continued to weigh on consumer demand, particularly in our larger markets of the U.S., Europe and Latin America. In the U.S., we saw a sharp increase in customer demand in Q4 ahead of consumption events, including the FIFA World Cup. While in Australia, inventory optimization across retailer and manufacturer supply chains contributed to a lower pallet demand in the year.

To offset lower underlying demand from existing customers, we have continued to drive new business growth in key markets with momentum supported by enhancements to our customer value proposition stronger sales capabilities and tightening supply of high-quality whitewood pallets, particularly in the U.S. and European markets. We also continue to see higher levels of automation across manufacturer and retail supply chains increasing the need for consistent high-quality pallets. This reinforces the importance of the investments we've been making in automation, digital and repair consistency initiatives to meet our customers' evolving needs and boost the long-term resilience of our network.

Turning now to the repair capacity constraints that emerged in parts of our U.S. network during the fourth quarter. As outlined on the slide, these constraints were not the result of a single factor, but rather reflect the convergence of several issues in the fourth quarter. As you will see on the slide, 1 of the contributing factors have since been resolved. Others are improving and a few continue to feature in our operating environment.

Among the ongoing factors are the quality initiatives we have been implementing over the past 2 years to support increasing levels of automation in customer and retailer supply chains. These initiatives include additional repairs, enhanced quality audits and more recently, the rollout of end-of-line inspection equipment to improve repair consistency across our network. While strategically important, this focus on repair consistency increased the number of component repairs required per pallet, reducing repair throughput at certain sites in our network. From April, this planned activity coincided with a number of unexpected developments within our subcontractor network and the broader operating environment. This included the tightening labor market in the U.S. which remains an ongoing challenge and continues to be an area of focus.

With the availability of labor declining, it became more difficult to attract and retain service center staff across our network, which further reduced repair throughput with some repair benches not being fully utilized. At the same time, we experienced turnover in our subcontractor base with 2 operators in the Northeastern and Central regions of the U.S. choosing to exit the network due to service center management being noncore to their business and challenging operating conditions.

Although all 15 affected sites remained operational repair throughput was below optimal levels. A transition plan is now in place for these affected sites. And importantly, there have been no further subcontractor exits from our network. These pressures then coincided with higher-than-expected customer demand in the fourth quarter, which has moderated since July. Individually, each of these factors would have been manageable within the normal course of operations. However, occurring simultaneously, they created temporary repair capacity constraints in parts of our U.S. network and disrupted our ability to fully meet customer demand and onboard new business.

In response to this, we increased pallet relocations across our network to meet customer demand. As these relocations were unplanned, we had to rely on significantly higher spot transport rates, which increased the cost of moving pallets to customers in the fourth quarter. We expect unplanned relocations to reduce as repair capacity constraints are resolved through the first half of FY '27. -- the repair capacity constraints and flow-on effects resulted in a negative earnings impact of USD 90 million, together with USD 40 million of additional pooling CapEx associated with new pallet purchases. Joaquin will provide a more detailed breakdown of these financial impacts shortly.

Moving to the next slide, which outlines the actions we are taking to resolve repair capacity constraints by the end of the first half of FY '27 and strengthen customer relationships as network performance continues to improve. Since these constraints emerged, our immediate priority has been to restore service levels for our customers. To do this, we have focused on improving pallet availability and increasing repair capacity across the network. The actions on this slide are primarily short-term measures designed to support customer demand and restore service performance while we implement initiatives to structurally increase network capacity and resilience. To increase repair capacity, we have introduced additional shifts and overtime at existing service centers and increased rates to attract and retain labor across our network. We have also developed an orderly transition plan for the sites affected by subcontractor turnover. To improve pallet availability in the short term, we have increased pallet relocations across our network and invested in new pallet purchases, adding 1.3 million pallets in the fourth quarter and expecting to add another $2 million during the first half of FY '27. Importantly, these actions are already delivering results.

As we return back to normal service levels with no missed customer orders since mid-June. This improvement reflects increased pallet availability from new pallet purchases, lower customer demand from peak levels and early improvements in repair capacity.

As operational performance continues to improve, we are also focused on strengthening our customer relationships and reaccelerating growth. This includes delivering consistently on our customer value proposition, restarting new business conversions and providing additional sources of value to customers, including through our digital offering.

Having addressed the immediate actions to restore service levels, this slide outlines the initiatives underway to structurally increase network capacity, strength and resilience and provide the headroom required to support our growth ambitions.

Within our subcontractor network, we are progressing the transition of 15 service centers with 3 sites already transitioned to new subcontractor management in the fourth quarter of FY '26. We expect the remaining 12 sites to transition primarily to subcontractors by the end of FY '27, and can confirm there have been no further subcontractor exits from our network since April. As part of this transition process, we will take the opportunity to diversify our subcontractor base and reduce concentration across the network.

We are also revising our strategic approach to subcontractors towards value sharing relationships that better support our safety, quality and productivity priorities. Initiatives are also in place to expand repair capacity by FY '28. As shown on the chart, we expect to increase repair capacity by about 20% against the FY '26 baseline supported by additional capacity at existing service centers and 8 new service centers added to our network. These new sites will include a mix of subcontractor and CHEP operated facilities providing greater flexibility across the network. The 8 new service centers are expected to require total investment of around USD 25 million, which remains comfortably within our existing medium-term non-pooling CapEx guidance of USD 200 million to USD 300 million per annum, excluding investment in Serialization+.

Beyond FY '28, we will continue expanding repair capacity in line with our growth expectations while maintaining sufficient headroom to support future demand and operational stability.

Automation and technology will also play an important role in improving agility and throughput across the network. This includes progressing our Service Center of the Future program towards touchless repair and using AI and machine learning to improve demand planning, collections processes and capacity management across the network.

Finally, we are establishing specialist teams that can be deployed quickly during operational challenges and network disruptions, improving our ability to respond and sustain customer service levels when issues arise. Taken together, these initiatives will help ensure the U.S. business is better positioned to support customer demand, capture future growth opportunities and respond more effectively to operational disruption.

We continue to see quality as a key source of competitive advantage in the U.S. market and an increasingly important differentiator as customer and retailer supply chains become more automated. You will see that we have a broad range of initiatives underway, focused on repair consistency and pallet durability. Together, these initiatives are designed to ensure our pallets meet the tighter tolerances required in an automated environment while maintaining pallet performance across customer supply chains and reducing repair intensity over time. I don't propose to go through every initiative, but we are confident we have the right road map to meet our customers' evolving needs.

Two particular highlights are the rollout of end-of-line inspections to cover 50% of repaired volumes by the end of FY '28 as well as the adoption of more rigorous quality measures.

Looking further ahead, the experience of the past several months has underscored the importance of the investments we are making to move towards a touchless plant through our Service Center of the Future program. Beyond quality benefits, this has the potential to improve safety and efficiency and reshape how our network operates. During the year, we took the next step in this program by signing a lease for the facility that will be our global automation and technology center. From this dedicated hub, our teams will develop and test technologies with a view to rolling out modular automation solutions in the next 3 years with the potential for a fully touchless plant thereafter.

Importantly, we expect to fund these quality initiatives within our existing non-pooling CapEx framework while still targeting to deliver our investor value proposition of total value creation of more than 10% per year over the medium term.

Let's now turn to Brand wards of the future. During this first year under our new strategy, we have made meaningful progress across each strategic priority. Starting with our customers. We continue to improve their experience by reducing the complexity involved in their interactions with us. Upgrades to the Mitek portal have now allowed customers to more easily track and manage their queries. Notwithstanding the challenges in the U.S., this focus on the customer experience has seen us continue to increase both our NPS and collection metrics across the group.

Next is part of our work to illuminate supply networks. FY '26 saw us continue to develop our portfolio of digital customer solutions towards standardized approaches that support scaling for customers. This includes 2 of our flagship products, end-to-end quality assurance and promo insights, which generate actionable insights for customers to protect product quality through temperature monitoring and to improve promotional execution. We have now expanded DCS pilots in multiple markets with growing retailer engagement and advocacy also helping to identify and convert customers to recurring subscriptions.

Turning to operational excellence. We achieved a 10% improvement in our safety performance as measured by lost time injury frequency rate. We are proud of the safety culture we've built, which has driven successive years of improvements and delivered our best-ever safety performance. We also continued to drive operational improvements through network optimization initiatives together with the rollout of standardized operating procedures across our service center network.

We are pleased to have made early progress against our 2030 sustainability targets. This included initiating regeneration activities across approximately 10,000 hectares through partnership with Wild Trust in South Africa with the aim to protect and manage 75,000 hectares during our 5-year program.

In decarbonization, we remain ahead of the minimum requirements of our 2030 science-based target trajectory. Our Scope 1 and 2 emissions decreased by 5% as a result of ongoing electrification of forklift trucks and fleet vehicles. Scope 3 emissions were 1% higher in FY '26 due to new pallet purchases in the U.S. and increased downstream transport emissions resulting from pallet relocations.

Finally, we established a baseline Employee Experience Index score of 87 out of a possible 100 and providing a new measure of our progress in strengthening diversity, equity and inclusion across our organization.

We'll move now to Serialization+, with an update on our rollout in Chile and the work underway to inform our decision on a potential rollout in the U.S. During the year, we reached an important milestone in Chile, with all customers now benefiting from the effortless service offer. This offer has significantly reduced customers' administrative burden, which was reflected in the 9-point increase to our Net Promoter Score in FY '26.

In addition to improving the customer experience, we have seen benefits to growth with the effortless service offer contributing to 15 net new customer wins and lane expansions. As the rollout in Chile has matured, Serialization+ continues to demonstrate additional sources of value. These include improved visibility of pallet movements, greater insight into network inefficiencies and increased opportunities to monetize pallet reuse and other noncompliant flows.

Although we are confident in the multiple sources of value, there are still some key areas we want to understand more fully before deciding on a potential rollout in the U.S. The most important of these is understanding the customer response to dynamic pricing. We're also excited about the opportunities to explore how serialization data can be used to improve network efficiency and customer outcomes, including identifying drivers of higher damage rates, longer dwell times and other cost to serve opportunities across the supply chain.

Finally, we continue to focus on reducing the cost of implementation through lower cost tracking technology and improved tagging solutions. We remain on track to communicate a decision on a U.S. rollout in the third quarter of FY '27.

Looking ahead to FY '27, we expected to deliver underlying profit growth and strong free cash flow as we resolve our operational challenges in the U.S. during the first half. For the full year, we expect sales revenue growth of 2% to 4% with underlying profit to increase 2% to 6%. Our outlook for cash flow generation before dividends is in the range of USD 800 million to USD 950 million, and we expect our dividend payout ratio to remain within our payout policy of 50% to 70% of underlying profit. Together with the additional USD 400 million on-market share buyback announced in May, we continue to target total value creation of 10% for shareholders, in line with our investor value proposition.

I'll now hand over to Joaquin to take you through our financial performance in greater detail.

Thanks, Graham, and good morning, everyone. Starting with the financial highlights on Slide 15. In FY '26, we delivered volume growth, expanded margins and generated strong free cash flow while managing the impact of repair capacity constraints in our U.S. business. We achieved strong net new business growth of 3% and continued to recover input cost inflation through price realization. These, together with productivity improvements and cost management initiatives delivered underlying profit growth of 4% and margin expansion of 0.6 percentage points after the $90 million underlying profit impact associated with U.S. repair capacity constraints. Excluding these impacts, underlying profit increased 11% and margin expansion was 1.8 percentage points. We maintain the structural improvements in asset efficiency achieved in recent years, which supported free cash flow generation of more than $1 billion.

As a result, we delivered total value creation of 9% for the year, comprising 6% EPS growth from continuing operations and a 3% dividend yield.

Turning now to Slide 16 for the overview of our full year results. I will focus on profit after tax and EPS with revenue and underlying profit covered in the slides that follow. Profit after tax from continuing operations increased 5%, ahead of underlying profit growth of 4% and as lower than net finance costs more than offset the impact from higher tax expense and the increased hyperinflation charge. Our underlying effective tax rate of 29.3% and is broadly in line with FY '25.

EPS growth from continuing operations increased 6%, including a 2 percentage point benefit from the on-market share buybacks completed in FY '26.

Finally, our disciplined approach to capital allocation and focus on productivity improvements resulted in ROCE increasing 0.4 percentage points to 22.6%.

Moving to Slide 17. Before stepping through revenue and underlying profit in more detail, I want to take a moment to outline the impact of U.S. repair capacity constraints on our underlying profit performance. As noted earlier, the impact of U.S. repair capacity constraints reduced underlying profit growth by 7 percentage points this year, with an underlying profit impact of $90 million. This primarily reflected short-term revenue and costs associated with pallet availability constraints and the actions we have taken to increase pellet availability and increased repair capacity across our network.

Starting at the top of the P&L. Revenue impacts reduced ULP by $25 million. This reflected a $45 million reduction in revenue, driven by our inability to fully service customer demand together with an adverse customer mix impact on price realization. From a cost perspective, we incurred an additional $20 million of plant costs associated with the extra shifts over time and incentives we have introduced to increase temporary repair throughput while we structurally increased repair capacity across the network.

Transport costs increased $35 million as we relocated more pallets to access available repair capacity in our network and meet customer demand. These unplanned movements increased our reliance on the spot transport market, which experienced significant inflation in the fourth quarter. Finally, IPEP expense increased by $10 million as pallet scarcity led to higher levels of unauthorized reuse of our pallets in customer and retailer supply chains. This $90 million earnings impact was $30 million higher than the expectations we outlined in our May trading update, in part driven by actions to accelerate customer service improvements including $15 million of additional pallet relocations.

Turning to Slide 18, and looking at the incremental year-on-year impact. We expect U.S. repair capacity constraints to have an underlying profit in FY '27. We've separated these impacts into 2 categories. The first relates to short-term costs associated with the actions already underway to increase repair capacity and improve pallet availability. These costs are largely temporary and are expected to unwind as the constraints resolved by the end of the first half.

The second category relates to structural increases in supply chain costs reflecting investments we are making to structurally increase capacity and strengthen the resilience of our network. Starting with the short-term costs. We estimate a $10 million to $20 million adverse year-on-year impact to underlying profit in FY '27. In the first half, this impact is expected to be between $70 million to $80 million and primarily driven by the same plan transport and uncompensated asset loss impact that affected our performance in the fourth quarter of FY '26.

We also expect a negative year-on-year revenue impact, reflecting lower volumes and some residual adverse price/mix. As repair constraints are resolved, these impacts are expected to reduce progressively through the first half, resulting in an estimated year-on-year benefit of $55 million to $65 million in the second half as we cycle the elevated costs incurred in the fourth quarter of FY '26. This improvement reflects a recovery in volumes and associated customer mix benefit as well as reduced reliance on overtime and additional shifts, lower pallet relocations and spot transport rates and lower IPEP expense as pallet availability improves.

Turning to the ongoing investments we are making to build greater resilience into the network. These will see a structural increase in supply chain costs, primarily associated with higher labor rates in response to inflation additional repair capacity across our network, the specialist resources to manage any potential future disruptions and depreciation on incremental pallet purchases. These costs are expected to reduce FY '27 earnings by $25 million to $35 million with the impact recognized in the first half.

From the second half, we expect pricing and efficiency initiatives to fully offset these higher costs, meaning there should be no ongoing earnings impact beyond FY '27. In summary, we expect the total adverse year-on-year ERP impact in FY '27 to be between $35 million to $55 million.

Turning now to the FY '26 results and group sales revenue growth performance. Group sales revenue increased 2%, with strong new business growth and price realization, more than offsetting lower like-for-like volumes across the group. Price realization was 1% as pricing increases to recover inflation were partly offset by efficiency benefits shared with customers and the adverse mix impacts from pallet availability challenges caused by U.S. repair constraints.

As you'll see throughout the presentation, price realization varied by region, largely due to inflation and benefit sharing with customers in each market. Net new business growth was 3%, driven by the U.S. and European pallet businesses with both delivering 3% volume growth with new customers. Momentum accelerated across the European pallets businesses in the second half of '26, while the U.S. maintained strong new business growth for the year, despite repair capacity constraints limiting our ability to onboard new customers in the fourth quarter.

Like-for-like volumes declined 2%, reflecting subdued consumer demand across several key markets and inventory optimization in Australia, partly offset by the benefit of cycling weaker second half 2025 comparatives. In the U.S., repair capacity constraints limited our ability to fully service the temporary spiking custom demand seen in the fourth quarter. Excluding the $45 million revenue impact from pellet availability challenges as a result of U.S. repair capacity constraints, group sales revenue growth would have been 3%.

Turning now to Slide 20. I Underlying profit increased by 4% and included the $90 million adverse earnings impact from U.S. repair capacity constraints outlined earlier, which is shown separately in the bridge. Excluding this impact, underlying profit increased 11%, reflecting the benefit of overhead restructuring, other cost management initiatives undertaken in the year and operating leverage from sales growth and pricing.

Sales revenue growth contributed $156 million to profit, while North American surcharge income increased by $25 million, in line with changes in fuel, transport and lumber market indices. Plant and transport costs collectively increased by $66 million, driven by input cost inflation, higher pallet damage rates in the U.S., increased pallet relocations in EMEA and APAC and incremental investment in quality and digital initiatives. These increases were partly offset by $145 million of savings from network optimization, operational excellence and procurement initiatives.

Depreciation increased by $31 million due to pulling equipment purchases and investments in automation and other nonpooling assets. While IPEP increased by $9 million due to higher uncompensated losses and increase in the for unit cost of pellets written off in Europe. Other costs reduced by $40 million, driven by overhead restructuring activity and cost management initiatives. These benefits were partly offset by wage inflation and $21 million of one-off restructuring costs.

Finally, central transformation costs decreased by $33 million reflecting the benefit of research and development incentives and the capitalization of Serialization+ equipment following increased confidence in the scalability of the technology and the commercial model.

Turning to margin performance on Slide 21. As shown on this slide, we continue to make strong progress towards our FY '28 margin improvement target. -- with margin expansion of 0.6 percentage points in FY '26 or 1.9 percentage points compared to the FY '24 baseline. Excluding the impact of the U.S. repair capacity constraints, margin expansion would have been 3.1 percentage points versus FY '24. Progress has been driven by overhead productivity and asset efficiency with supply chain productivity, representing the largest opportunity for margin improvement.

Supply chain productivity, as measured by the group's net plant and transport cost to sales ratio has decreased margins by 1.3 percentage points since FY '24. We with the decline primarily reflecting the increased costs associated with U.S. repair constraints.

Moving forward, we have a number of initiatives to drive efficiencies within our supply chain operations including the use of data, AI and insights from our digital assets to improve demand planning, collection processes and capacity management throughout our network. We will continue to drive automation, pallet durability and procurement initiatives, and we also expect to see reduced inefficiencies in FY '28 from a reduction in excess plant stock in the U.S.

Moving on to overhead productivity, which has provided 2.1 percentage points of margin expansion versus FY '24 due to the benefits from streamlining operations, process improvements enabled by technology and the FY '26 restructuring program. Lastly, asset efficiency initiatives contributed 1.1 percentage points of margin expansion versus FY '24 through a range of sustained structural improvements including enhanced data analytics and improved pellet visibility enabled by our digital capabilities.

Turning to Slide 22, our 2 key measures of asset efficiency, the group pulling capital expenditure to sales ratio and IPEP to sales ratio continue to demonstrate the strength of our asset control initiatives and the sustained reduction in capital intensity over the past few years. The pooling capital expenditures to sales ratio increased by 0.6 percentage points to 12.9% in FY '26. We well below historical averages. This was driven by the increased weighted average cost of a new pallet and 1.4 million additional pellet purchases, both largely reflecting the fourth quarter pallet purchases in the U.S.

During the fourth quarter, the U.S. business also utilized 0.6 million excess pallets held in storage, which resulted in a capital expenditure holiday of $20 million. Excluding this, FY '26 pooling CapEx to sales would have been 13.2%. We have conducted audits of the remaining 3.4 million excess pallets held in storage and confirmed they are suitable for repair and reuse within the network when required. The FY '26 IPP to sales ratio of 1.7% was a 0.3 percentage point increase on the FY '25 ratio, due to higher uncompensated losses in the U.S. and Europe. However, it remains well below historical averages, reflecting the sustained improvements we have made in asset productivity and the recovery of our assets.

The result includes the impact of a higher FIFO unit cost of pellets written off in Europe and a $10 million impact from higher unauthorized reuse due to pallet availability challenges in the U.S.

Moving to our cash flow performance on Slide 23. Pleasingly, we delivered free cash flow before dividends of over $1 billion for the second consecutive year. which highlights the progress we have made in structurally improving the capital intensity of our business.

During the period, earnings growth and favorable working capital movements were more than offset by a $165 million increase in cash capital expenditure, a $61 million increase in net financing and tax payments, largely reflecting higher tax payments in line with earnings growth, and a $62 million adverse movement in other cash flow items, primarily reflecting changes in employee benefits provisions and increased technology investment.

Turning now to Slide 24, let's look at the segment performance, starting with CHEP Americas. Revenue increased 2%, with balanced contributions from price and volume. Price realization of 1% was driven by Latin America and Canada. U.S. price realization was flat as inflation recovery was offset by sharing efficiency improvements with customers and the adverse mix impacts from repair capacity constraints. Volume growth was 1% and included a 3% increase in net new business, partly offset by a 2% decline in like-for-like volumes, reflecting lower consumer demand in the U.S. and Latin America, as well as the impact of U.S. repair capacity constraints in the fourth quarter.

Margins reduced by 0.2 percentage points, largely driven by the short-term underlying profit impact in the U.S. as discussed earlier. Adjusting for these, margins improved by 2 percentage points, driven by a range of productivity benefits across supply chain and overheads, which more than offset additional costs from higher damage rates in the U.S. and the continued investment in poor quality and digital initiatives to enhance the customer experience across the region. Excluding U.S. repair capacity constraints, ROCE improved 2 percentage points due to underlying profit growth, partly offset by a 3% increase in average capital invested, reflecting pallet purchases in the region, investment in service center automation and higher lease service center assets.

Turning to CEHP EMEA, where we reported strong net new business momentum while ROCE and margins were impacted by short-term supply chain headwinds. Revenue increased 2% and with equal contributions from price and volume. Pleasingly, net new business wins increased 2%, driven by the European pallets business, where new business growth increased to 4% in the fourth quarter giving us strong momentum into FY '27. Growth in the region was partly offset by net contract losses in the South African pellets business and a contract loss in the automotive business. Like-for-like volumes decreased 1% due to lower consumer demand across the automotive business and the Pallets businesses in Europe and South Africa.

Margins declined by 0.6 percentage points as productivity initiatives were more than offset by short-term supply chain headwinds, including higher relocation costs and inefficiencies associated with lower volumes in the South African pellets business as well as higher IPEP expense in Europe. Return on capital invested decreased 0.8 percentage points, reflecting a 2% increase in average capital invested as underlying profit remained in line with the prior year.

Moving to CHEP Asia Pacific, where revenue increased 3%, reflecting price realization of 4%, offset by a 1% decline in volumes. Volume performance was driven by a 3% decline in like-for-like volumes, reflecting a lower average number of pellets on hire due to inventory optimization at retailers and manufacturers in Australia. This was partly offset by contract wins across the region. Underlying profit margin improved by 1.8 percentage points as benefits from supply chain and overhead productivity initiatives were partly offset by investments to enhance customer service and quality as well as increased repair, handling and relocation costs associated with inventory optimization by retailers and manufacturers. ROCE increased 2.9 percentage points, reflecting profit growth as ACI remained in line with FY '25.

Moving to the Corporate segment on Slide 27, where central transformation costs decreased by $33 million. As I mentioned earlier, this was primarily driven by the incremental benefit from research and development incentives and the capitalization of Serialization+ equipment following increased confidence in the scalability of the technology, equipment and commercial model.

Other corporate costs decreased $11 million due to restructuring benefits and a range of cost management initiatives, which more than offset wage inflation and one-off restructuring costs.

Turning to our FY '27 outlook considerations on Slide 28. We expect sales revenue growth of between 2% and 4%, including equal contributions from price and volume with growth expected to be weighted to the second half due to the impact of U.S. repair capacity constraints. Continued momentum is expected in net new wins in Europe, while U.S. net new business growth is likely to be slightly below FY '26 levels. Like-for-like volumes are expected to be broadly flat subject to consumer demand trends.

Underlying profit is expected to grow between 2% to 6%, with efficiencies expected to offset the impact of U.S. repair capacity constraints and continued investment in strategic initiatives. We expect a mid- to high single-digit profit decline in the first half, followed by low double-digit growth in the second half. A modest improvement in the underlying profit margin is expected versus FY '26. We with improvement in EMEA, a modest decline in APAC and broadly flat margins in the Americas despite a $35 million to $55 million adverse year-on-year impact from U.S. repair capacity constraints.

The plant and transport cost ratio is expected to be broadly flat to slightly unfavorable with an elevated cost ratio in the first half, offset by improvements in the second half. reflecting costs associated with U.S. repair capacity constraints, largely offset by supply chain productivity benefits. We expect a modest improvement in the IPEP sales ratio from ongoing asset control initiatives.

Lastly, overhead and other costs as a percentage of sales is expected to be broadly in line with FY '26 with labor inflation, higher depreciation and strategic investments, offset by productivity initiatives including a net $40 million benefit from the FY '26 restructuring program.

Moving to Slide 29. In FY '27, we expect free cash flow before dividends of $800 million to $950 million, with a pooling CapEx to sales ratio of between 13% to 15%. Higher pooling CapEx reflects increased pellet prices and additional pallet purchases to support growth and address U.S. repair capacity constraints, partly offset by asset productivity benefits.

FY '27 cash outflows include $40 million relating to pallets purchased in the fourth quarter of $26 and $60 million for an additional 2 million pallets expected to be purchased in 12 -- these investments support the resolution of customer impacts from U.S. repair capacity constraints. Nonpooling capital expenditure is expected to be between $350 million and $400 million including accelerated investment in supply chain initiatives, such as end-of-line quality control and automated digital inspection. Digital CapEx is expected to be $120 million including $110 million of spend on Serialization+, with spend weighted to the second half given the expected timing of the North America rollout decision. We also expect net finance costs to increase by $30 million and dividend franking to reduce to 15% from the current 20%.

In summary, in FY '26, we delivered earnings growth, margin expansion and strong free cash flow generation in a challenging operating environment. We achieved strong new business growth across the group, while efficiency initiatives helped to offset the short-term earnings impact of the U.S. repair capacity challenges. Strong free cash flow generation enabled us to continue investing in the future of the business, while returning $1.2 billion to shareholders through dividends and share buybacks.

Looking ahead to FY '27, our focus remains on resolving the U.S. repair capacity challenges, building greater resilience in our network and delivering further efficiency benefits across the group. We expect these actions to support underlying profit growth, further progress towards our FY '28 margin target and sustainable free cash flow generation. while maintaining investment in our strategic priorities.

I will now hand over to the operator for Q&A.

[Operator Instructions] Your first question comes from Niraj Shah with Goldman Sachs.

Just a couple for me. Firstly, can you help us quantify how much your repair capacity was kind of reduced by versus normal in the fourth quarter and also the magnitude of demand uplift that you guys saw?

Niraj, thanks for the questions. In terms of your question, the first 1 was around quantifying the impact on repair capacity. Obviously, varies by region, but we gave a guide of somewhere between, let's say, 5% to 10% was the impact on repair capacity.

And then the magnitude of demand was your question again. vary significantly by region. But again, what we said was that we saw a significant lift versus what we'd already forecast. So obviously, in some areas, we saw high single digits demand growth, if that helps.

That does. And secondly, just keen to get an understanding of what gives you, I guess, confidence in being able to offset those structural costs from fiscal '27. And holding on to the productivity benefits just given how subdued the end demand backdrop is currently?

Yes. I mean I think, Niraj, 1 of the things here is I think it's very clear that we recognize that to the extent this is self-inflicted, we have to eat it. But -- to the extent this is now structural costs, which initially when we talked back in May, no 1 believed us that there were big problems with labor availability in the U.S., but now more and more people are recognizing that -- this is not just a Brambles issue. I think that lends -- gives some confidence that it will be part of the normal inflationary related cost to serve increases, which we've had, I think, several years, if not many years now, of structurally being able to recover that through our contracts. So I think that what gives us confidence. So it is a general issue, which everyone is going to have to address. But I think specifically, we have got very clear plans with the U.S. team around how do we go about both the pricing element of offsetting the cost but also the productivity piece. This is not just about going to customers and getting it all through pricing. We have got to be very clear about the productivity plans. And of course, as you would expect, we have a lot of detailed plans with milestones and resources against that to ensure that we attack both bits of that solution.

Your next question comes from Samuel Seow with Citi.

I just want to ask on the underlying EBIT growth you're expecting in your business, excluding the repair costs. It looks like in FY '27, if I adjust out those supply costs you're expecting ULP growth around 4% to 5%. I just want to know -- is that correct? And then two, it appears slightly lower than the value proposition, I guess, is that a function of lower like-for-likes or just any additional color there, please?

Yes. Sam, -- just coming back to your first point, the way I look at it is we've guided underlying profit growth of between 2% to 6%. And then if you look at the total year-on-year impact in FY '27 of U.S. repair capacity -- repair constraints, that's $35 million to $55 million. So I'll be adding that back to the number. Does that help you?

Got it. Yes, yes, that's helpful. And then maybe and the like-for-likes. I mean, as it relates to your repair capacity constraints, counterintuitively almost, do you actually want a soft double or declining like-for-like environment to help you with the recovery? And any just -- and maybe just any color on the environment that will help with the repair recovery? And anything that you don't want to see per se, like the spike in demand?

Yes. So I think I'd go back to what we said around the Q4 environment, which is we already were planning for an increase in like-for-likes, and we had this additional spike on top driven by things like the World Cup and the 250 -- 4th of July celebration. So we don't need the like-for-like to be any softer than we currently think they're going to be. And if you look at what everyone is saying, Nielsen have come out fairly recently with what's going on in the U.S., it is pretty soft still, but that's what we were planning for. We don't need it to be softer because we have got the plans already to now to recover the capacity point part of the issue by the time we get to December. And I don't think I would prefer stronger like-for-likes to be honest, because that's what drives our business. So I don't think we need any additional help from what we've already planned for.

Your next question comes from Andre Fromyhr with UBS.

Just following up on the costs associated with the repair constraints. What can -- I appreciate the disclosure splitting out short-term impacts and structural costs. Am I right in understanding because the numbers are quoted as year-on-year, but and the improvement in the second half, not fully recovering the $90 million that you've just recorded in second half '26 that there's also sort of a steady add run rate second half or like a, let's say, a full year run rate of about $60 million of structural costs expected?

Yes. So Andre, let me just have a go and see an cover that. So you're right in terms of what the second half 27 short-term cost you will be, what we're saying the benefit is 55 to 65 and you're right, we don't fully reverse the $90 million that we incurred in FY '26. Part of that is because, obviously, the volume impact takes time to recover. So it's not a like-for-like. So you can see we said the price volume impact on earnings is $25 million. in FY '26. And then we're saying in the second half, it's a $10 million benefit. And so that's because, obviously, it's about building relationships with customers again and converting those customers or lanes back to us.

And then what we've tried to be clear on is that at the end of the first half '27, essentially, there are no more short-term costs. And then there are the structural costs or investments, and that ends up being $25 million to $35 million that we don't cover in the first half. But then as we go forward, so from the second half onwards, as Graham just outlined, we recovered those through other productivity initiatives and through price realization.

Okay. So the -- what's reflected there is sort of net expectation after things like pricing recovery and the cost efficiencies as well, which, of course, will full year impacts than once you get into '28?

Exactly. So the way I would think about it is, essentially, you have the half 127 and full year impact. And then in FY '28, you're back to sort of business as normal.

Okay. Cool. And then just another 1 about the noncalling CapEx budget for FY '27. It's quite a step-up from the run rate that we've seen in previous years. And I understand there might be heightened urgency to get the automation equipment rolled out given the circumstances of the U.S. operations. But how much risk is there to the timing of getting the equipment and deployment that you want on those initiatives? And then, I guess, related is $110 million S+, just a very firm signal that you're leaning towards proceeding with that initiative?

So thanks again, Andre. I think that's a good point that I just wanted to make sure everyone was clear on while you do see that step up in non-pooling CapEx. There is that step up in digital that you talked about of that $110 million for serialization. So you sort of have to adjust the numbers when you think about run rate, I would adjust it by that $110 million because as we gave that range of $200 million to $300 million, that was before spend on SPs. So that brings us back to a more normalized level. I think if you adjust for that, you're running at about $240 million of non-high stock.

And then your question, I think, then was followed about the risk of timing of automation end of line those pieces of equipment that we're putting in. Look, we have a really detailed plan -- the team have done a good job of delivering against that plan more at times what may change is the timing of payments at some point with suppliers, et cetera, et cetera. So we would like to spend all of that non-higher stock CapEx, let me be clear because what we're trying to do is set the business up for the long term.

Your next question comes from Owen Birrell with RBC.

I just wanted to, I guess, follow up on Sam's question around the, I guess, the underlying operating leverage ex the service center issues. You're guiding sales of 2% to 4%. You had a 1 percentage point impact in FY '26. So let's assume that happens again -- so we have underlying sales of 3% to 5%. Your EBIT guide is 2% to 6%. Adjusting for the net impact that you referred to there we should be getting somewhere between 5% and 9%. But as you had highlighted for '26, you had 11% EBIT growth on an underlying basis. So it looks like there's, call it, 2%, 3% or 4% delta on your operating leverage in '27 on 26. Can I just ask, is the vast majority of that an inability to reclaim that structural cost impact that you've referred to, I think it's $25 million to $35 million additional cost in '27?

Look, for me, it's more about -- obviously, as we've been restoring service levels in the U.S., it impacts, for example, your ability to chase new business. So as we pointed out, we expect sort of U.S. net new wins to be lower in FY '27 than they were in FY '26 because essentially, we're not converting new business until the second half, if that helps. And then also when you think about supply chain and efficiency initiatives, obviously, the focus in the U.S. is against restoring service levels. And so some of those efficiency initiatives will take longer to execute than we had originally planned.

There's very much a volume issue in terms of that like-for-like coming backwards.

That I think in terms of like-for-like, that's based on what we think consumer demand will look like in the market. And that's what we've tried to be really clear on the ranges is to say this is a range based on consumer demand, so people can make their own decisions around that. And also inflation obviously impacts pricing depending on how you consider that. So I mean that's how I'd more think about the comparison year-on-year, if that's okay.

Okay. And then just in terms of, I guess, what you saw in the fourth quarter on that consumer demand issue. You've mentioned that like-for-like volumes in FY '27 was down 2% saw underlying subdued underlying consumer demand. But then you also talk about peak demand from U.S. customers in the fourth quarter. Just trying to marry up those comments. Was that fourth quarter just a one-off pull forward of demand that you're effectively going to have to cycle as you roll through into FY '27?

Yes, it's really driven by those big consumption events, which won't repeat next year, I suspect, i.e., the World Cup. And the fact that because the 4 July this year was for the 250th anniversary, it was almost a weeklong celebration rather than a day or 2. So that's what we -- and whilst we were obviously knew about the World Cup, it has happened every 4 years, and we knew it was in the U.S., and we planned for an increase based on the forecast we're getting from customers, the actual demand was much higher, but it was in certain customers, certain segments, wasn't across the board in the U.S.

So next year, depending on what happens to the economy generally and consumption generally, which hopefully will be better than it was in '26, but you never know. The actual -- those specific events won't repeat, so you will be having to cycle them. But remember, we didn't actually fulfill all of that spike in the first place. So hopefully, the cycling impact will not be as great as it would have been if we'd actually met all the sales.

Just 1 last question for me. I guess on that -- those structural cost impacts that you're sort of guiding to for '27, I just look into the appendixes, the plant costs in the U.S. have incrementally stepped up I'm just wondering if you can give us a sense of where you think those plant costs should land in '27 as a ratio of sales given this additional structural cost. How much of that is going to be net offset by productivity? Or should we just be assuming that at the moment?

So in terms of when the outlook considerations, what we've talked about, that's Slide 28, is that we expect net plant and transport cost ratio to be broadly flat or slightly deteriorate in FY '27, but obviously that includes the impact of U.S. repair capacity constraint. So essentially, what I do -- that's why we tried to break it out as plant and transport for you. So if you want to see the underlying, I would add those costs back.

Your next question comes from Jakob Cakarnis with Jarden.

Just going to start on Slide 19 with the group sales growth, if I could, please. Just the half-on-half momentum, it looks like the price you had in the first half up to -- and then the implied price mix in the second half was flat, so 0 to get to the 1% that's on the slide. Can you just help me understand what dynamic has gone on there at the group level, please?

Yes. So again, 1 of the things is price realization is around, I guess, recovery of cost to serve, taking away what I would say is the short-term costs that we feel we're not recoverable from customers. I think the other thing that I would think about is obviously in our pricing surcharges in the U.S. are not included in that price realization. So I think I wouldn't quite look at it as that being the only way that we've recovered cost to serve increases in the market.

Just to carry that logic on though, you're getting us to think in the second half of that there's some recovery mechanisms available. I'm just wondering how that plays through, given that profile that we've seen through FY '26?

How I think about this, Jakob, is that we're very disciplined about recovering that cost to serve. So if I give you a different example, but you think about the spike that happened in or the increase in fuel cost that's happened, where our recovery mechanisms weren't going to recover at all. So that's in Europe and Latin America, we put in fuel surcharges or the equivalent of that to recover. So I think the team are very clear where it's a structural increase in costs, then we will recover that cost to serve in the pricing mechanisms or other mechanisms that we have available.

Okay. And then just a second one. Slide 21. I read it as though still committing to the 300 points of margin expansion relative to FY '24 by FY '20. But you've told us that FY '27, you're going to have modest underlying expansion. So you're starting from 190, call it relative to '24 FY '26 base and then modest next year. How do we reconcile the kind of $50 million to $100 million that you need to do in FY '28. And I guess, in a challenging environment for everyone from your customers to yourselves. How do we think about the ability to realize that. Is that more from internal rather than external mechanisms, please?

Yes. A couple of things I would say there, Jakob. I think the first point is, I think of the starting point as being the underlying performance business. So obviously, the $1.9 million you quoted is impacted by the U.S. fourth quarter and those costs coming into FY '27. So if you think of underlying at the end of FY '26, we're running at 3.1, right? And we did say 3 points plus.

And then as I look at that opportunity, that first sort of supply chain productivity, if you adjusted that for the impact of U.S. repair capacity would essentially be flat over 2 years. So we haven't made any margin improvement there. So that's the opportunity area also things, for example, we're still storing excess pellets in the U.S. So we'll work our way through that, which will give us a tailwind into FY '28. And then obviously, there's still opportunity in overhead productivity and asset efficiency. So I think the easiest way to look at this is to look at underlying as opposed to taking sort of the headline number.

I appreciate that. But the U.S. has happened, and it's in the company's earnings now. So I guess what it could have been -- but I'm just trying to reconcile how will all bridge to FY '27. Obviously, you've said 300 plus, I think some others are reflecting that. So yes, I get that what you're saying is that it's a one-off, but there are now structural trends that you guys are flagging that we wouldn't have foreseen when this was issued. So I'm just trying to bridge them.

But I think I'd separate it a little bit because it's not like we're trying to help people read through. It's not that we're excluding an event that doesn't reverse in terms of sort of costs. And then as per the answers on a couple of other questions, those structural costs we're saying we will recover in the second half and onwards. So look, I think you're right, Jakob, everyone confirm their own view. What we're trying to do is put the numbers and our assumptions out there. but recognize that people may have a different view on that.

Your next question comes from Anthony Moulder with Jefferies.

If I can go back to that pricing recovery that of the -- would have reduced the 25% to 35%, how much of that is price you're expecting to recover through second half '27, please?

Anthony, how I would look at that is -- and I think Graham touched on this earlier. Our first priority is to drive efficiencies within the business to offset that. And then obviously, then the -- where we can't, then that flows through to pricing to customers, right? But I think what our customers would expect us to do is to look for efficiencies in our own business first.

Sure. It sounds like you could open contracts. You don't have to wait like over 3 years. You can push through pricing increases for these structural costs in a shorter time frame. Is that what we're hearing.

I mean, I think, Andy, what I would say is the fact that labor inflation is an issue for everybody, every business sector in the U.S. implies that it might be a bit easier to do than it just being a Bramble specific problem. So I think that would be my take on it.

Yes. If I switch to the corporate costs, they were down. It looks like it's capitalized some OpEx going forward. So how have you come to that decision because it doesn't look like that was part of the guidance that you gave even back in May for that kind of a reduction in corporate costs through FY '26. Just help me understand is at what point you came to the decision to capitalize some of their OpEx, please.

Yes. So just so I'm clear, Anthony, a couple of things. So firstly, in the corporate segment from corporate costs, there was an $11 million roughly decrease, and that's due to the restructuring program that we did in cost management. Then I think what you're referring to here is essentially the digital transformation costs, and it's a couple of items. One is there are research and development incentives that we get for the work we do in digital. So that's included. And then we had, as you'd expect us to do to be conservative on where we're testing equipment related to Serialization+ our philosophy has been that we will take the provision against that until we are comfortable that the equipment has a useful life and that we're actually going to execute it.

And as Graham touched on, we've had very encouraging signs both from the Chile rollout. And then we've been testing equipment in the U.S., and we're comfortable now that, that equipment will either use for SP+ or we can use it for other areas of our business. But I think look, it looks like a large quantum, I think about it differently because in a way, you take a provision, let's say, last year and you -- and then if you release it this year, you've almost got to halve that number, Anthony, so it's not like it was a huge capitalization that we then release.

Right. But when -- I guess the question is, when did you come to that decision? It looks like it's clearly post the 18th of May.

I think a couple of things to note. One is that if you look at the first half of FY '26, we already had research and development incentives. And we had also released the in Chile equipment provision that we've taken. So it's not like it was a reaction to -- it's just progressively like you'd expect us to do. We review our provisions every half.

Okay. And lastly, if I can on overhead, it looks like overhead was scale higher through second half of '26 as well if I'm reading this correctly, it looks like you haven't changed the quantum of overhead reduction expected through 27. Is that how I should think about overhead?

No. I think all we might need to line numbers here, but from what I can see, we slightly overdelivered on our restructuring benefits in the full year. So as you think about FY '27, there is a $40 million benefit from restructuring initiatives, which is what we committed to at the start of FY '26.

Yes. So that's no change, I guess, is the 1 you've dragged higher provisions or higher overhead reductions through to make the FY '26 numbers.

No, that's not how I think about it, Anthony, what I'd say is we've done the restructuring initiative and the benefits are being delivered. But what we have done is we've taken the cost of restructuring above the line, essentially, right? So that's how you get to the $40 million. And then we've covered the R&D and the Serialization+ in the earlier reply. But I think this isn't a case of -- sorry, let me just relied a little bit more their Anthony. I think you can see that we are doing the right thing for the business. So if this was about protecting earnings, we wouldn't be making the investments that we're making in the U.S. business, right? So priority #1 is our customers, and then the results will be what the short term, it's about making sure that we're setting the business up for long-term success.

Yes. Lastly, if I could then on EMEA, a bit of a weaker result, but I appreciate parts of the continent are not performing and even the U.K. not performing as well, you've lost the -- or push the head of the U.K. business out. How do you think about EMEA through '27, the growth that you're expecting through that business, please pretty important business from a margin perspective and growth?

So Anthony, on the EMEA result, a challenging environment, as you've said, Also, as we talked about in the May trading update, again, changes in volume demand impacted relocation costs and also changes in volume have impacted sort of fixed cost recovery within supply chain. So we've had some supply chain headwinds. And then also in terms of asset productivity, we had higher uncompensated losses in Europe and also an increase in FFO. So when we're thinking about both of those, as we're building our FY '27 plan, there are 2 key areas that we're tackling. So we've put in additional asset productivity measures in, and we've upweighted our supply chain efficiencies.

Your next question comes from Lee Power with JPMorgan.

How should we take the mix of subcontractor versus internalized repair capacity going forward? It looks like I think about what you said you'll roll out to '28, it's kind of like a 50-50 split versus what you've been doing kind of 85% subcontract currently? And just your view? And does that make it kind of easier or harder from a cost perspective to kind of manage given the labor issues don't seem like they're going away from an inflation per point.

I mean, I think they're trying to come up with the -- what's the optimum mix between subcontracted and in-house is quite tricky. Clearly, I would say what we've learned over the last 3 or 4 months is that we need to develop more of a partnership approach with some of the subcontractors so that we are jointly investing in capability to ensure we're consistently delivering the repair quality. So it doesn't really matter whether it's in-house or subcontracted at that point. It also 1 of the other lessons we've learned in the U.S. is that we do need to ensure that the capacity is not concentrated with certain groups of subcontractors in certain regions. So 1 of the objectives over the next couple of years is to sort of dilute that concentration effect -- but some of our subcontracted plants are performing as highly as our own one.

So I think it's more about where do you want the ability to variabilize the cost a little bit more and have that flexibility -- but I think going forward, I think I would look at the development of what we might do around touchless repair capacity. So this plant of the future service center of the future, we've been talking about when you start developing those, clearly, with a lot of technology and it's a lot of IP in it, you can more like to have those as being in-house plants. And to get the scale benefits, they will handle much higher percentage of the repair capacity. So I suspect, over time, you'll see the 80-odd percent coming down, but I have no idea what it will come down to whether it's 60%, 40%. It doesn't really matter as long as we're getting consistent performance out of both the subcontracted plants and the in-house plants.

And again, to the point about the labor costs, over time, what we're trying to do is reduce the percentage of the cost base, which is driven by labor and have it more driven by things like automation and robotics. So that's the sort of direction of travel.

Okay. And then Slide 7. So 35% of the fulfillment improvement and lower demand. I take your comments earlier, but it's still -- it would be good to get any additional color in what you've actually seen in your business from a demand perspective in July and August? Because it feels like everyone saw a little bit of a bump, but we get very mixed commentary around whether that's continued to FY '27, regardless of what the Nielsen data says like what have you actually kind of seen you today in your business? And how has that progression kind of looked?

Well, I think we've seen what we thought we might see when we talked back in May, which is that demand was going to normalize, and it is quite mixed between categories. So you've got to think a little bit about the fresh produce season, which is peak time in sort of mid of the summer in the U.S., which is now, of course, dropping off a little bit. The beverages were definitely impacted by the World Cup and now have now normalized. But then against that, you've got to start looking at what's the underlying macroeconomic direction in the U.S. appears to be getting slightly better, but it's not really dropping into the consumption numbers yet, and that's what Nielsen is showing. And -- but again, even if at Nielsen, you've got to look so carefully across the categories and even within the categories, the drinks companies, they were very different performance between the big beverage companies. So it's hard to give you a definitive answer, but our view is that consumption has definitely normalized. And the big question is, well, what's it going to do going forward in terms of the macroeconomics.

Okay. And then just 1 more, if I can. The -- the SBS side, like it feels like going from, I think, Andre's comment earlier, it feels like your you're more likely than not to push out regardless of the pricing piece. What does that actually get you? Like what do we assume if we've got that in 27 like what's a sensible assumption in '28? And do we run a similar non-pooling CapEx number into '28 regardless of your longer-term numbers guidance unchanged?

Let me do the what do you get bit first and we'll let backing do the 28 impact. So I think the first thing to say is we are going to stick to our communication around the fact that we will make a decision about the rollout in February or March next year because there are still things we want to check out. But the reason that we can still be confident about the investment is that we know that even if we don't roll out SPs in the U.S., the equipment and the smart pallets that we would use, we get value from using them anyway. So we're going to -- we put those into the system and get value back -- the only other sort of high-level thing I would say is we've been very consistent in saying we expect a 5-year payback from those sorts of investments, and we would still stick with that from what we've seen so far in Chile. So do you want to do a bit more of that $28 million.

Yes. And I think it was something we talked a little bit about internally. The reason we've given you a Serialization+ sort of CapEx number for FY '27 is should we decide to roll out, we didn't want to take you by surprise, right? So to have a major change in our cash flow forecast. So that's why we have included it. And then as you think about it, if or as part of making that decision, we will take you through the detail in terms of what are the returns we expect, what are the timing of those returns, et cetera. So I would treat the investment more as a placeholder in the numbers at this stage.

Your next question comes from Scott Ryall with Rimor Equity Research.

Just a real quick question on the corporate costs. And I'm only talking to corporate, not the transformation costs here. Do you think they can go down much further?

Scott, I think the way I think about it more is looking at our sort of overhead cost across the business rather than a specific element. I think what we work through is what's best done locally, what's best done centrally. So I would look at it more in totality than just the transformation costs as a 1 item. And then in general, do I think there is more productivity that the business can grow without adding the same level of overheads at the same rate? I think that's an opportunity for us.

Okay. I'll take that as a half answer. Then Graham, on -- first of all, I think it's great that the STI mechanisms recognized the issues in North America in particular. So that was really good. My question is actually on the LTI and the change in structure going forward. Can you just -- you talked in the presentation in so many years that the value creation framework and targeting the -- well, having a 10% plus as your kind of threshold. So I read the new LTI structure as management will only earn a relatively small proportion of the LTI is you deliver 10% of the threshold. But actually, you really get incentivized when you get to 14% of the target or 17% is your maximum. And do you want to talk about that a little bit more in the context of why the changes are made, please?

Yes, sure. So as we've discussed over the years, I think the LTI being split between TS/RTSR, and then this grid between sales revenue growth and ROCE was potentially incentivizing people to do the wrong thing in terms of maximizing the ROCE when in fact, we should have been reinvesting in the business. So that was the sort of the background to it and recognizing also that I personally don't believe that revenue growth drives the share price. I believe that cash flow generation and how you distribute it back to shareholders, drives the share price. So if we're looking to align long-term incentives with the experience of our shareholders, then we -- clearly, I think given that we've told the shareholders that we are committed to delivering 10% plus year in total value. we needed to change the structure of the LTI. So that's 1 good thing.

I think the things that we've also tried to manage because there have been varying comments about this is, one, we haven't dropped any measure of sales growth in the incentive structure. It comes back into the STI structure. So there's still incentive around that split between total revenue growth and net new business win growth. So that's covered that bit. And there's also a floor on the LTI paying out related to ROCE. So we haven't kind of given up on having to keep the ROCE at a high level as well. So then you go back to your point, which is it's around this total value creation, and it is very much skewed towards out delivery at the upper end rather than just hitting 10%. And -- and again, I think that's appropriate because we're also asking for the opportunity to go up as well. And I think we should be getting paid more if we deliver exceptional amounts. And that's how we've tried to structure it.

Yes. Okay. Great. And just for confirmation, if the 20% ratio to underpin.

Yes, yes.

Your next question comes from Cameron McDonald with E&P.

Just wanted to unpick the revenue impact of the pallet availability issues. So the $25 million impact in that fourth quarter, if I look at how many -- and then put that forward, annualized, it's $100 million run rate, you're making about $25 million -- $25 an issue in the U.S. per pallet per year. So for the full year, it's 4 million pallets, but you've got turns. So you're looking -- it looks to me as if you're somewhere between 1.5 million to 1 million pallets sort of shortfall. Is that math correct? And then how does that relate back to the pellet purchases that you've announced?

So just a couple of comments, Cameron, to make sure we're just aligned here. So what I would say is that $25 million includes both volume and price. So we've talked about it's an adverse customer mix. So I wouldn't relate at all to volume, which I think is how I heard your maths, if that helped.

Okay. Well, that did make the pallet shortage even less if it's got prices price attached to that as well. So what I'm trying to get to is if you only sort of bid in pallets, why are you buying.

So I think a couple of things that I would think about there is, one, obviously, we're continuing to do improve the consistency of repairs across the network, so making sure we have capacity as we do that. We're obviously transitioning some contractors or some subcos. And then obviously, we're looking to set ourselves up for growth as soon as we can. So it's a combination of all those elements that I would think about.

Yes. but that's the point of the question is so break that back down, how many pellets do you need to purchase just because of the availability issue that you highlighted in May not to invest in further growth, not for anything else, just that particular issue. So I guess how I'd look at it is we've said we bought 1.3 million issues in the quarter.

All pallets that we purchased, they paid for in FY '27. And you can see that we've not shorted any customers essentially. So we've not missed any customer orders. And then we've given a forecast for the first half of '27, which is 2 million pallets. So that tells you we're using those pallets to service demand and make sure that also as we improve repair consistency and we transition that we have enough buffer stock to make sure that we continue to service our customers.

Okay. That's where I was somewhat hitting, right? So a Yes. But the 2 -- no, that was good. I mean the $2 million is effectively additional pallets that you -- but is not specifically tied to that plot availability issue that you've tried to solve. So that's fine. Just -- and then just on that back in the back in the May number and sort of going back to the -- particularly the guidance that you've given around this. The initial guidance was $60 million. You've missed that by 50%. That's 8 weeks ago before not even 6 weeks to the end of the financial year. Why aren't you going to be 50% out on the full year basis in '27 when that's looking forward 12 months?

Yes. I think about that a little differently. So if you think about that made trading update, we had not expected to not be shorting customers at this point in time. So what we were able to do was invest faster to resolve the issue for customers, and that's why essentially we've spent that additional $30 million. There is a portion of that we did not foresee, which was the increased losses as pellet availability has become more challenging. Recyclers, et cetera, it's been more difficult to get pallets back. But I would say, obviously, the bulk of that 13 million relates to resolving the issue faster for customers. It's not our forecasting era for 1 of a better word.

Your next question comes from Matt Ryan with Barrenjoey.

Just look at Slide 18, down the bottom, you've got the total year-on-year profit impact from capacity constraints of $35 million to $55 million. Are these the 2 numbers that you're putting into your guidance of 2% to 6% of the group, so the $35 million and the $55 million goes into that range?

Yes, that's right, Matt.

Okay. So I guess the midpoint of that would be, I don't know, a little bit over 1% to EBIT. So in effect, I guess, 3 out of the 4 points of your range does not relate to the capacity issues. Just interested in your thoughts on the moving parts there and the like-for-like volumes, sort of the biggest area of uncertainty? Or maybe you could just talk a little bit about how you sort of the high and the low end of the range playing out?

Yes. So just to make sure, if I don't answer your question, Matt, then just let me know. But in terms of thinking of the variance in the range, I guess the first key factor that we think about is consumer demand. Obviously, very variable, as we've talked about, various views of what's going to happen to that. So we wanted to make sure people understood that's a cornerstone of sales revenue, that range as we talked about, and also inflation. So we recover cost to serve increases if inflation varies, then our price realization varies. And then obviously, you have a sort of wider spread of both of those items when you think about profit because of 1 point of revenue is roughly $70 million, whereas 1 point of profit is roughly $14 million. Does that kind of answer?

Yes. So I mean a lot of it does come back to that sort of like-for-like inflation.

Exactly.

Rather than pricing and new business wins and things like that. And then obviously, getting FY '28 guidance, but you said that these issues are sort of resolved. So I guess the most important number of most of our models is that play cost to sales ratio I think you've sort of said that you've heard improvement with the relocations, so maybe we sort of put the transport cost to 1 side. We still have to, I guess, summarize your mitigation of these issues to say that you're back into that historical range of plant cost of sales ratios in the U.S. in FY '27?

Answering this 1 carefully, Matt, because we're obviously not giving FY '20 guidance. But maybe if I think we're trying to help you with what the underlying plan to transport ratio is in FY '27. And then more how I would think about it is that we are looking to deliver on our investor value proposition in FY '27. So obviously, that would be high single digits UOP is how we would look at that. I think the other thing is while we went to some detail in the slides, and I know they aren't quite detailed, but was to split out things like plant and transport costs, so you could adjust the ratio accordingly. So does that help without giving FY '28 guidance?

Yes. I mean I think the summary is you're sort of going to incur higher rates for service centers, but then you sort of cost to serve initiatives are what kicks in thereafter to get you back to that number in '28.

Exactly right, or also where efficiencies don't offset the increase in cost to serve, they will deliver price realization to offset that.

Your next question comes from Peter Steyn with Macquarie.

Graham and Joaquin, just tying a few things together. Graham particularly interested in your perspective around utilization of capacity in the network and your expectations of having to potentially have more late in the network on a structural basis over the next number of years, how you think about that playing into returns, particularly if you get to a place where more of it is going to be on your own balance sheet and potentially diluting your ROCE outcomes ever so slightly. Maybe just frame that up for us, please.

Yes. I mean I think the sort of problem that has arisen in the U.S. has been twofold. One is that we've had a number of years of very low organic growth. And therefore, people were comfortable with low latency in capacity. And secondly, I think the other thing to think about is that the volatility of demand has changed dramatically over the last few years. So you put those together, I think there is definitely, to your point, a need to increase the latency around our repair capacity. But I think the way to do that is not just -- we shouldn't assume that the solution for the future is the same as the solution in the past. And what I mean by that is I think the investments we're making now in things like automation technology, but more important, I think going forward because we've obviously always done a bit around automation is the adoption of tools based on AI. It's not just an AI play. I think it's more about how we manage better the data we've already got to do the demand and supply panic planning better and to be more effective in how we're relocating pallets around the network. I think all of those will allow you to increase your ability to withstand demand spikes better without having to add a lot more capacity.

So I don't see it as a risk to the balance sheet. I see it's more a risk that we have to get -- pull our finger out a little bit and get on with the technology changes that we're already planning to do around plant to the future and also make sure that we are adopting and rolling out some of the quite clever stuff that's around AI now in demand and supply planning. That would be my sort of reaction to that sort of question.

Your next question comes from Justin Barratt with CLSA.

Maybe a question for Joaquin, I guess a bit of a follow-up on some previous questions. Can you give us an idea of what you think the total short-term underlying profit impact is from the pilot shortages that you've incurred recently. I guess you're sort of looking at the $90 million in FY '26, $80 million in the first half. But again, it does look like you're not fully recouping the $90 million back into the second half. So I just wanted to see if you can give us an idea of how much that impact is? And is that impact higher than what you thought back in May?

Thanks, Justin. I think the way -- if I understand your question correctly, that we've been doing it is you have the reported numbers or our guidance numbers and then adding back the U.S. to look at what the underlying profit would be. So for example, as you said, in the FY '26 result, you could add back $90 million. And then when you look at FY '27, you would add back doing year-on-year, the cumulative of the $90 million and then the $35 million to $55 million range.

Yes. I think for me, like the way that you described it back in May was that the impact in the last quarter of '26 would be $60million. And then as we look to try and size it up into '27 would be sort of in the range of $60 per quarter and that the impact would be largely resolved by the yen. Is that sort of still a better top line or more broadly how we should be thinking about it. But obviously, the $30 million has been brought forward into FY '26.

Exactly, exactly right. And then there's some structural costs that are not those short-term costs that then impact the first half that we don't recover and then we recover them in the second half. So exactly how you're thinking about it is the right way, and the costs exactly are broadly in line with the comments we made in May, but there is that $30 million that has come through earlier to deliver better service to our customers.

And then so sorry, then how do I understand the second half with the growth being sort of 55% to 65%, but the $90 million impact within the second half of last year.

So I guess a couple of things. One is, we talked about it a little earlier, but the sort of the impact in FY '26, that $25 million of customer mix and volume, our view is that it will take time to recover that. So essentially, when you think of the second half '27, we're saying it will take time to build relationships and convert some of those customers or lanes back to us. So that's why, in essence, there's $15 million in just that, that you don't recover.

And so then isn't the EBIT impact then larger than what you sort of described back in May if it's going to take a while to recover that lost revenue.

I guess what I would say is we didn't necessarily give a number in May, but I know people did the math, which was to say exactly what you said. We flagged a $60 million impact in the quarter. What people, I think, did was double that number because you had a half and then say, but there will be some recovery. So net-net, where people may have ended up, I think, obviously, it is difficult to predict things like transport spot rates, fuel at the moment, et cetera. So this is our best estimate now. I think it's reasonably close to what we thought in May, but there is a bit variability.

Understood. And then maybe 1 for you, Graham. Just wanted to sort of get an update on how your conversations are going with potential converters to your offering from, I guess, a whitewood offering. That's where you've been getting most of your new business wins. I guess from my perspective, before was a white would use potentially thinking about moving to a pool option would have a bit of a pause for concern given the recent update where they might have been caught short part, I guess?

Yes. So I think what we said back in May has turned out to be pretty accurate, which is clearly, we've let some of those SME type customers down who are existing customers, and we were in the process of talking to 1 you wanted to convert -- and we had to basically go back to them and say, look, we can't convert you right now, but -- and this is when we think we can convert you eye the second half. I would say, with the exception of one, they've all been fine with that. So we had 1 customer who decided no, they didn't want to wait, and they've gone back to white.

The 1 thing I would say, though, is what we're seeing in the market in the U.S. is that the availability of good whitewood pallets is extremely tight at the moment. So that's helping the conversation a little bit, which is, again, it's a bit like what we did a few years ago. If you're with us, we can guarantee, that's part of our value prop is to make sure that we have got pallets when you need them. And the signs that we are spending money on new pallets in the U.S. to ensure that we've got that availability I think, allows us to give a bit more confidence to those people who are thinking about converting together with the tightness on white words.

And people are increasingly interested in and engaged in the other benefits of a pooled solution versus white, which is a sustainability one. So it is becoming more of an attraction people realize that the benefits of a circular solution outweighed out of a one-way solution. So I think all those things are helping us. But we have disappointed people and as Joaquin said earlier, we have spent a bit of time getting that trust back before we convert. So not a term as far as I'm concerned.

Great. I think we're finished with the questions. I don't normally do this, but I would just like to sort of say we've given a lot of numbers and detail in the pack. So if I could just step back from that a little bit and just give a few comments. I think the first thing is we've delivered a really good set of results in '26, even after the impact of what's happened in the U.S. in Q4.

I hope you now see it really was a perfect storm. We're no longer falling short of customer orders, and we have a clear plan to fix the issues relating to the repair capacity by December of this year. We're going to continue to invest in quality and the resilience to support our customers and make sure we can -- we service future growth in the U.S. And we fully expect to exit FY '27 in strong shape as we're recovering the structural increases in cost to serve through both productivity and pricing.

I know we'll be speaking to you a lot over the next few days and weeks. So I look forward to all the conversations around H1, H2 and next year, but Joaquin looking forward to it even more than I am. But thanks very much for joining the call already. Thanks.

Good morning, everyone, and thank you for joining our presentation of Brambles' first half results for the 2026 financial year. Today, I'll be sharing the highlights of the first half a detailed look at the operating environment as well as our progress against our strategic priorities.

I'll then outline our revised outlook for FY '26 before handing over to Joaquin to take you through the financials in more detail.

Let's start with our first half performance highlights. Our first half result reflects the resilience we've built into the business and our disciplined execution on factors we can control to drive efficiencies across our operations and improve the customer experience. We achieved sales revenue growth of 2%, with strong net new business growth offsetting consumer demand pressures on like-for-like volumes and pricing recovering cost to serve increases.

Underlying profit was up 7%, reflecting meaningful operating leverage driven by supply chain and overhead productivity improvements, together with disciplined cost management across the business. Higher earnings and sustained improvements in asset efficiency delivered robust free cash flow before dividends of USD 482 million.

As a result of this strong cash flow generation, we are pleased to declare an interim dividend of USD 0.23 per share up 21% on the prior corresponding period. Our strong financial performance has enabled strategic reinvestments to strengthen our customer and investor value propositions over the long term. Chief among them are enhancements to the customer experience, encompassing platform quality, service reliability and responsiveness.

These improvements continue to position us as the partner of choice for existing customers while supporting considerable new business momentum in all regions. Customers are also benefiting from our ongoing focus on collaboration to drive efficiencies across their supply chains alongside productivity improvements in our own operations. Together, these initiatives are making our business more agile and ensure we deliver strong value for customers relative to alternative solutions.

The FY '26 on-market share buyback is on track for USD 400 million by the end of June 2026, with USD 191 million of shares purchased during the first half of the year. Finally, we are proud of our ambitious 2030 sustainability program launched in September last year. The program guides the next phase of our regenerative ambition, building on our success to date while extending our focus on nature and deepening our net positive impact across the value chain.

Let's turn now to the key operating dynamics and their impact on our business in the first half. Our operating environment was characterized by moderating rates of inflation and challenging consumer demand conditions across key markets. Inflationary pressures were modest and primarily driven by labor and transport, while fuel prices remain stable. Lumber prices were varied across regions, while the average capital cost of a pallet for the group, excluding mix, was broadly aligned with the first half of FY '25.

Against this backdrop, our price realization reflected modest increases in the cost to serve with inflationary pressures tempered by the efficiencies and benefits we generated across customer supply chains and our own operations in the period. This included benefits from the overhead restructuring program we announced last year, which positioned us well to manage the impact of the demand headwinds we experienced in the half.

Consumer demand remained weak, particularly in the U.S. and Europe due to ongoing cost of living pressures and increasing labor market uncertainty with the U.S. further affected by a prolonged government shutdown. As a result, pallet volumes with existing customers declined across both markets in the first half.

We also saw lower like-for-like volumes in Australia as retailers and manufacturers reduced inventory levels in response to normalizing consumer demand patterns and stable supply chain dynamics. Importantly, there was no material inventory optimization in other key markets where optimization largely occurred during FY '23 and FY '24.

Despite softer demand from existing customers, our overall volumes were supported by continued success in winning new business, building on the momentum established in the second half of FY '25 and reflecting our sustained investment in sales capabilities and a compelling customer value proposition. As automation becomes more prevalent across supply chains, customers are increasingly recognizing the quality, reliability and efficiency benefits, Brambles and its platforms can offer in navigating complex operating environments.

Broader market dynamics in whitewood, including price increases and challenges to the availability of quality recycled pallets in the U.S. during the first quarter also supported new business conversions in the period. From a cost perspective, we continue to see increased costs driven by excess pallets in the U.S. and inventory optimization in Australia. These included incremental transport costs in both markets. while the U.S. continued to incur storage costs and additional repair activity due to ongoing increases in pallet damage rates.

Finally, we ended the period with approximately 4 million excess pallets in the U.S. in line with levels at the end of FY '25 as softer consumer demand conditions and pallet inflows from Latin America, meant surplus plant stock was not absorbed as quickly as anticipated for the half. However, we still expect to return to optimal plant stock levels by the end of the first half of FY '27.

Turning to our Brambles of the Future strategy and the progress made in the half. Delivering an effortless customer experience remains a core pillar of this strategy. And we are pleased with the ongoing improvements across key customer metrics, including reducing the time for complaint resolution and improving our performance in both the delivery and collection of pallets. This contributed to a 9-point gain in our Net Promoter Score against the first half of FY '25, which has also been supported by our ongoing investment in pallet quality to help meet the evolving requirements across customer and retailer supply chains.

Initiatives, including incremental repairs, enhanced quality checks and audits and automated end-of-line inspections are all helping to ensure quality remains a core part of our customer value proposition. We continue to make steady progress in digital and data to build solutions that ultimately drive efficiency in connection by illuminating supply networks to solve supply chain problems.

Our portfolio of digital customer solutions, including proof of delivery, reusable asset optimization and end-to-end fresh continues to gain momentum as we scale pilot programs and engage additional customers during the first half of FY '26. We now have engagements with a wide range of retailers, manufacturers and fresh producers, spanning 9 countries, including the key markets of the U.S., the U.K., Spain and Australia.

Within our own operations, our focus is on building a leaner, more agile circular model that can set new standards in safety, efficiency and resilience and to do that at scale. This starts with safety, where we delivered meaningful improvement against key measures.

Our sustained commitment to a safety-first culture has translated to a lost time injury frequency rate improvement of 38% against the prior corresponding period. At the same time, our supply chain initiatives ranging from procurement transport and plant network optimization and operational excellence have supported an 80 basis point margin improvement.

We have also steadily progressed our plant of the future program, which includes our long-term ambition to develop touchless repair capabilities and identify opportunities for the integration of modular technology across our service center network.

Finally, we are progressing our regenerative ambition to build supply networks that deliver positive outcomes for the environment, communities and economies. We recognize that in applying regenerative principles to meaningful areas across our operations, we are working at the forefront of sustainability strategies. As a result, our early focus has been on developing a road map with stakeholders throughout the business and in collaboration with leading nongovernment organizations to deliver our 2030 targets. This includes leading-edge metrics and measurement systems that help drive and track our net positive impacts while ensuring we maintain credibility and the confidence of all stakeholders.

Among early achievements of our 2030 program has been the continued steady progress in decarbonization with a 5% reduction in our Scope 1 and 2 emissions while we lowered Scope 3 emissions by 1%. Our leadership in sustainability continues to be recognized externally. We are proud to have retained CDP's maximum A-List rating for both climate change and forest while also achieving global top employer certification for the fourth consecutive year.

Turning now to an update on our serialization Plus program, which has the potential to deliver significant incremental value across all pillars of our strategy. In Chile, our pilot market for serialization plus the focus remains on delivering value to our customers through the end-to-end visibility of supply chains enabled by our pallets. In the first instance, this is about offering a new effortless service offer that significantly enhances the customer experience by removing the burden of pallet declarations and audits.

At the end of the first half, 95% of customers have converted to this effortless service offer. And we remain on track to convert the remaining customers to this model by the end of FY '26. At the same time, we continue to systematically explore additional sources of value, serialization+ can unlock for customers and our business, which I'll address in more detail on the next slide.

Operational testing continued in North America and the U.K. as we seek to optimize the key cost and operational factors that are critical considerations for any future decision to roll out serialization+ in these markets. In North America, we continue to build the base read infrastructure across our service center network that underpins the serialization+ operating model.

During the half, we instrumented an additional 10 service centers and remain on track to have read infrastructure in place to cover 2/3 of planned flows by the end of FY '26. We also took meaningful strides in reducing the cost of tags in the period. After training 48 different tag types in the half, we reduced tag costs by over 20%, with exploration of further optimization opportunities underway.

In the U.K., we continue to explore the feasibility of lower-cost tracking devices. Performance to date has been encouraging, particularly in how these lower-cost devices complement the autonomous tracking devices already deployed. Together, these technologies are expected to capture data and insights in a more cost-effective manner.

Turning to Mexico. We are scaling our continuous diagnostics program by deploying our autonomous tracking devices with full functionality. While the primary benefits from continuous diagnostics is improved asset control and network visibility, we have also been encouraged by our early success in our end-to-end fresh subscription offering.

Finally, we are leveraging our smart asset base in North America and Europe to enable new customer propositions. We are encouraged by the positive feedback received to date and look forward to further developing this offering to enhance the customer experience by reducing the administrative burden as well as expanding the lanes we can potentially service.

Turning to the value insights from Chile this half. We continue to refine our understanding of value across the serialization plus scorecard outlined in August, which is guiding our efforts to prove out the value potential of serialization+.

From a customer experience perspective, as we have converted our customers to the effortless service offer, we have seen the number of transactional queries from customers reduced by 1/3 with the greatest decrease seen in audit-related cases. As one of the major friction points in our traditional pooling model, this result gives us comfort about the improved customer value proposition that serialization+ enables.

On growth, the effortless service offer continues to facilitate new business growth in Chile with 5 new customer conversions and 2 lane expansions in the first half. Particularly pleasing was the fact all 7 customers attributed their decision to choose CHEP to the simplicity and benefits of the effortless service offer.

For pricing, serialization+ continues to identify unauthorized reuse across the supply chain, providing opportunities for us to monetize this in line with the cost to serve. We know that by optimizing the cost to serve, including asset efficiency, we can deliver value for both Brambles and our customers.

To advance this, we have released our first version of our serialization+ app. The app allows us to interrogate damage rates and cycle time in a visual manner, presenting us with the opportunity to partner with our customers to support asset performance in their supply chains. These insights are also being combined with additional data to identify leakage points across the network to improve asset efficiency.

On generating value from supply chain insights, we are looking at our own service network to determine the benefits of being able to identify an individual pallet at additional stages of the integrated repair line, including understanding the additional efficiencies this can create.

Secondly, we are trialing the ability to scan pallets at manufacturer sites to assess opportunities to optimize pallet reuse. We aim to further develop these capabilities in the second half to understand the value potential from these areas and other supply chain insights.

Finally, I would also like to reiterate that any full market rollout is contingent on achieving the previously communicated hurdle of greater than 15% return on capital invested once the market pool is fully serialized.

Let's turn now to our FY '26 outlook before I hand over to Joaquin for the financial overview. Based on our performance in the first half and expectations for the balance of the year we have revised our full year guidance. We have narrowed our expectations for revenue growth to 3% to 4% previously 3% to 5%. And this reflects our view that consumer demand is likely to remain subdued while also recognizing there is uncertainty in how sentiment evolves during the year.

Our guidance for underlying profit growth remains unchanged at 8% to 11%. As the anticipated supply chain and overhead cost efficiencies, we expected at the beginning of the year, accelerate in the second half, delivering operating leverage despite modest volume growth. We have upgraded our guidance for free cash flow before dividends by USD 100 million and now expect free cash flow generation of USD 950 million to USD 1.1 billion for the full year. This reflects reduced pooling capital expenditure in line with volume growth expectations alongside the rephasing of the automation and digital investments.

We expect total dividends for FY '26 to remain in line with Brambles dividend payout policy range of 50% to 70% of underlying profit. Finally, we remain on track to complete the USD 400 million on market share buyback by the end of FY '26, subject to the full range of conditions customary for buybacks.

I'll now hand over to Joaquin to take you through our financial performance in greater detail.

Thanks, Graham, and good morning, everyone. Before getting into the details, I wanted to touch on the key highlights of our first half performance. These were the strong new business momentum across our Power businesses in the Americas, Europe and Asia Pacific as we continue to convert new customers away from the whitewood alternatives.

Our ongoing commercial discipline that recovered cost to serve increases in the period. The continued focus on supply chain and overhead productivity, which delivered strong operating leverage with margins expanding by 1.1 points. and the sustained improvement in the capital intensity of our business, which underpinned the strong free cash flow generation in the first half.

Overall, our results highlight the resilience of our business as we continue to deliver on our investor value proposition despite like-for-like volume softness with total value created for shareholders of approximately 16% and including EPS growth of 13% and a dividend yield of 3%.

Turning now to Slide 12, which provides an overview of our first half results. I will focus on our profit after tax and EPS performance here as I will address revenue and underlying profit in the slides that follow. Profit after tax from continuing operations increased 11%, ahead of the 7% growth in underlying profit as lower net finance costs and a reduction in the hyperinflation charge more than offset the increase in tax expense during the half.

Net finance costs decreased 7% reflecting strong free cash flow generation that reduced the average balance of floating rate borrowings during the period. Despite a 3% increase in tax expense, our underlying effective tax rate decreased by 1 percentage point at actual FX rates, primarily due to the reduced impact of the base erosion and anti-abuse tax in the U.S.

EPS growth from continuing operations increased 13% and included a 2 percentage point benefit from the on-market share buyback undertaken during the 2025 calendar year.

Finally, our continued capital allocation discipline and focus on driving productivity improvements resulted in ROCE increasing 1.1 percentage points to 24.3%.

Moving to Slide 13. Group sales revenue increased 2% in the half, as continued momentum in net new business and ongoing commercial discipline to recover cost to serve increases more than offset the impact of weak consumer demand on like-for-like volumes.

Price realization of 2% was primarily driven by price increases to recover inflation, mainly in labor. As you'll see throughout the presentation, price outcomes varied by region, reflecting local inflation and sharing cost to serve efficiencies and productivity benefits with customers, as Graham outlined earlier.

Net new business growth increased 2% as the strong rate of new business wins achieved in the fourth quarter of FY '25 continued into the first half of FY '26. The Americas and European Pallets businesses delivered net new business growth of 4% and 2%, respectively, across quarter 1 and 2, providing an encouraging platform as we headed into the second half.

Like-for-like volumes declined 2% reflecting the consumer demand and inventory optimization dynamics Graham outlined earlier. Performance across all components of revenue growth was broadly consistent in both quarter 1 and quarter 2. In the second half of '26, like-for-like volumes are expected to benefit from cycling a weaker second half '25 comparative period.

In addition, we expect some improvement in U.S. consumer demand in the remainder of the year, subject to prevailing market conditions.

Turning now to Slide 14. Underlying profit increased by 7%, including approximately $15 million of one-off restructuring costs. Excluding these costs, underlying profit grew by 9% as sales revenue growth and benefits from supply chain and overhead productivity initiatives offset inflationary pressures and increased investments to enhance the customer experience and progress digital initiatives.

Looking at the key drivers of profit growth. Sales revenue growth contributed $72 million to profit, while North American surcharge income increased $5 million, in line with prevailing market indices for lumber, transport and fuel. Plant and transport costs collectively increased $19 million as cost savings of $73 million from procurement transport and plant network optimization initiatives were more than offset by several cost increases across the group.

These included input cost inflation of $53 million and costs associated with higher damage rates in the U.S., driven by increased asset utilization in line with improved asset control in the region. In addition, we also saw higher transport activity in the first half as we optimize pallet balances across North America and average a longer length of haul in Europe.

IPEP increased by $1 million as continued asset control improvements in the Americas were more than offset by higher IPEP expense in Europe in the first half, driven by increased pellet loss rates and a higher first in, first out unit cost of pallets written off. The first half '26 IPEP expense also included a $5 million charge relating to the timing of audits in Europe, with a higher percentage of annual orders conducted in the first half of '26 compared to the first half '25. This is expected to normalize in the second half of the year.

Other costs increased $5 million as cost management initiatives were more than offset by a reduction in asset compensations in Europe due to lower losses in compensated channels and increased scrap pallets in the U.S. due to the impact of higher damage rates. The overhead restructuring program was a net expense of approximately $1 million in the half. As $15 million of costs were largely offset by the realized benefits of $14 million.

Central transformation costs reduced by $8 million, reflecting the receipt of government research and development incentives relating to our digital program and the capitalization of serialization plus equipment in Chile following the successful customer adoption of the ASR.

Turning now to margin performance on Slide 15. At our FY '25 results announcement, we revised our FY '28 margin expansion target to 3 percentage points plus, up from 2 points plus compared to the FY '24 baseline. As shown on this slide, we continue to make good progress towards this goal, delivering 1.1 percentage points of margin improvement half-on-half, and we remain on track to deliver our FY '28 margin improvement target.

Several key drivers contributed to our first half margin performance, which I'll cover now. Supply chain productivity, measured by the group's net plant and transport cost to sales ratio contributed 0.8 percentage points to the improvement in margin. This was driven by cost savings from procurement, enhanced transport productivity and plant network optimization initiatives.

Overheads and other cost productivity contributed 0.3 percentage points to margin improvement, reflecting the ongoing benefits associated with streamlining operations, improving processes, leveraging technology and reducing discretionary spend. Following a strong contribution to margin expansion in FY '25, asset efficiency remained stable this half and did not provide incremental margin benefit. This outcome reflects continued improvements in asset control in the Americas, driven by digital insights and enhanced data analytics, which offset the higher IPEP expense charge in Europe I outlined earlier.

Turning to Slide 16. You can see the impact of asset efficiency improvements in stabilizing the capital intensity of our business, reflected in both the IPEP to sales ratio and the group's pooling capital expenditure to sales ratio. These outcomes demonstrate that the gains we have delivered in asset efficiency are structural in nature.

The pooling capital expenditures to sales ratio remained broadly in line with first half '25 at 11.8%, as the increase in pooling capital expenditure due to pallet purchase mix was offset by sales revenue growth.

Power purchase units remained in line with first half '25 as higher volume growth in first half '25 was largely supported by the utilization of excess pallets in the U.S. in that period. There was no capital expenditure benefit from access pallets in first half '26. Given excess pallet balances in the U.S. remained in line with the FY '25 level.

Growth in replacement requirements in the U.S. business in the first half will manage through pellet inflows, primarily from Latin America. While the IPEP to sales ratio remained in line with first half 25% at 2%, it is expected to be approximately 1.6% for the full year, driven by ongoing improvements in asset control and the normalization of the audit timing impacts in Europe in second half '26.

The increase of 0.2 percentage points on the FY '25 ratio reflects the impact of higher FIFO unit cost of pellets written off and an increase in uncompensated losses primarily in the EMEA segment.

Moving to our cash flow performance on Slide 17. Free cash flow before dividends increased $53 million to $482 million in first half '26. This increase was driven by a combination of higher earnings and lower working capital outflows and primarily due to normal variations in the timing of creditor payments. These benefits were offset by a $73 million increase in capital expenditure on a cash basis mainly reflecting the timing of pallet purchases in the period.

A $20 million net increase to finance and tax payments due to earnings growth, partially offset by lower finance payments due to strong free cash flow generation. A $7 million decrease in proceeds from sale of property, plant and equipment due to lower losses in compensated channels, particularly in Europe, and a $3 million net increase in other movements, primarily due to increased spend on intangible assets relating to technology investments to support customer experience, digital and supply chain initiatives. This is partly offset by lower outflows from employee provisions.

As outlined on Slide 16 on asset efficiency, there is no cash benefit from the utilization of excess pallets in first half '26.

Turning now to Slide 18 and looking at segment performance, starting with CHEP Americas. The region delivered new business momentum and meaningful margin and ROCE improvements driven by efficiencies across all aspects of the business. Revenue growth of 2% reflected a balanced contribution from price and volume.

Price realization of 1% recovered cost-to-serve increases while volume growth of 1% was driven by a 4% increase in net new business across all pallet businesses, which more than offset a 3% decline in like-for-like volumes. This decline reflected weak consumer demand in the U.S. and Latin America across most consumer staple sectors as well as weather-related impacts on the beverage and produce sectors in Mexico.

Margins increased 2.1 points as asset efficiency improvements and benefits from supply chain and overhead productivity initiatives more than offset incremental repair costs linked to higher damage rates in the U.S. increased relocation activity to optimize pallet balances across North America and one-off restructuring costs. These benefits also supported further investments to improve the customer experience. notably quality investments, including enhanced end-of-line quality control and pallet durability as well as digital investments, including serialization+.

ROCE increased 2.3 points as profit growth more than offset the 2% increase in ACI with asset efficiency improvements in the region, partially offsetting increased pallet purchases in Latin America and investments in automation.

Looking now at U.S. pallet revenue on the next slide. The U.S. Pallets business delivered revenue growth of 1%, supported by volume growth as strong net new business momentum offset consumer demand headwinds to like-for-like volumes. Price realization was in line with the cost to serve as price increases to recover inflation, primarily in labor were offset by sharing benefits of better asset control and other cost to serve efficiencies with customers.

Net new business volume growth of 4% was driven by enhanced sales capabilities and an improved customer value proposition, as well as favorable market trends, including increased automation in customer supply chains and retailer advocacy for pooled pallets. This sustained momentum offset a 3% decline in like-for-like volumes, reflecting weaker consumer demand due to persistent cost of living pressures, together with prolonged U.S. government shutdown in the period and increased labor market uncertainty.

We continue to have a strong new business pipeline in this region and expect this rate of net new business growth to continue in second half '26.

Turning to CHEP EMEA. While first half margins in ROCE were impacted by one-off items and timing, we still expect profit growth and margin expansion for the full year. Revenue increased 2% driven by 2% price realization to recover modest inflation. Net new business wins increased 1% as a 2% growth in European pallets more than offset the impact of a large customer contract loss in the automotive business.

Like-for-like volumes decreased 1% due to weak consumer demand in Europe across both pallets and the automotive business. This was partly offset by growth in South Africa and Tokai. Margins declined by 1.6 percentage points as sales growth and supply chain and overhead efficiencies were more than offset by one-off restructuring costs of $5 million, input cost inflation, higher pallet collection activity and a $15 million increase in the Europe IPEP expense. This increase included the $5 million timing impact I mentioned earlier, which is expected to normalize in the second half of the year.

The balance of the IPEP increase reflected higher uncompensated losses and increased for unit cost of pallets written off. Return on capital invested decreased 1.9 percentage points reflecting lower underlying profit and a 2% increase in average capital invested driven by higher lease costs associated with service center additions and renewals and investments in service center automation.

Moving to CHEP Asia Pacific on Slide 21, where productivity initiatives and commercial discipline supported investments in customer experience and financial returns. Revenue increased 3%, reflecting price realization of 4%, offset by a 1% decline in volumes. Volume performance was driven by a 3% decline in like-for-like volumes reflecting a lower average number of pellets on hire due to inventory optimization of retailers and manufacturers in Australia as well as weaker consumer demand in New Zealand impacting RPC volumes. This was partly offset by contract wins across the Pallets and RPC businesses.

Underlying profit margin improved by 0.9 percentage points, reflecting operational efficiencies including supply chain and overhead productivity initiatives. These benefits were partly offset by inflation, investments to improve customer service and quality as well as increased repair, handling and relocation costs associated with higher pallet returns due to inventory optimization.

ROCE increased 2.2 percentage points, reflecting profit growth and a 1% decrease in average capital invested, which included the benefit of asset productivity improvements across the region and lower lease service center assets.

Moving now to the corporate segment on Slide 22. Where central transformation costs decreased by $8 million. This primarily reflects the receipt of government research and development incentives related to digital investments and the capitalization of serialization+ equipment following the successful conversion of the market in Chile to the FLS service offer. While other corporate costs decreased $1.5 million, reflecting productivity and cost management initiatives.

Turning to our updated outlook considerations for FY '26 on Slide 23. We now anticipate full year sales revenue growth of between 3% to 4% with contributions from both price and volume. This reflects our view that consumer demand will remain subdued while recognizing there is uncertainty around how demand will evolve through the remainder of the year.

Second half '26 price realization is expected to be broadly in line with the first half. While second half volume contribution is expected to increase reflecting continued net new business momentum as well as the benefit of cycling weaker like-for-like comparatives in second half '25 and some improvement in U.S. consumer demand in second half '26.

Underlying profit growth guidance of 8% to 11% remains unchanged and includes expansion in group and all 3 segments profit margins. At a group level, the FY '26 combined plant and transport cost ratio is expected to improve approximately 1 point compared to FY '25, reflecting benefits from supply chain efficiency initiatives.

As I previously mentioned, we continue to expect the IPEP to sales ratio for the full year to be approximately 1.6%. The FY '26 overhead and other cost contribution to margin is expected to be broadly in line with the first half of '26. This includes the net benefit from the overhead restructuring program of $15 million and further investments in central transformation costs, including serialization+, digital customer solutions and IT upgrades.

Importantly, we remain on track to deliver an annualized benefit of $55 million in FY '27 from the overhead restructuring program.

Moving to Slide 24. For the full year, we expect to deliver between $950 million to $1.1 billion in free cash flow before dividends. This $100 million upgrade to the lower end of the prior outlook is primarily driven by 2 factors: firstly, a reduction in the pooling CapEx to sales ratio range by 1 point to between 13% and 14%, reflecting lower volume growth and lower-than-expected pallet prices.

Secondly, a $50 million benefit from lower nonpooling capital expenditure driven by delayed spend on service center automation equipment and rephasing of serialization plus expenditure as the business continues to refine the optimal technology approach and mix in the U.S. and U.K. based on learnings from Chile.

In terms of other considerations, while I do not propose to go through each item, we do expect net financing costs to be lower than our original expectations due to strong cash flow performance. In summary, we are pleased with our first half performance. which reflects the resilience of our business and disciplined execution on factors we can control. While the consumer demand environment remains weak, our focus remains on driving net new business wins in all markets. and enhancing efficiency and productivity across our business. We expect these actions to support margin expansion and sustainable free cash flow generation, while enabling us to continue investing in strategic initiatives that underpin our long-term success.

I will now hand over to the operator for Q&A.

[Operator Instructions]. Your first question is from Justin Barratt from CLSA.

Two questions. First one, I just wanted to understand if you could talk a bit more actually about your net new business growth cadence throughout the first half of FY '26. I guess I'm just also asking that reference to, if we look at the cadence of your growth in new business wins a couple of halves, it looks like it moderated a touch in this first half.

Thanks, Justin, you're talking at an overall group level. Is that right?

Yes.

I'd say moderated very, very slightly. So you can see that essentially when you look at Europe and the U.S., our exit rates at the half were the same as how we exited Q4.

I think one thing to note on sorry, just 1 thing to note, Justin, on new business is to a lesser extent, but it still is impacted by consumer demand. So obviously, as you see weakness in consumer demand, then the new business that you win, you get slightly lower volume than you would have otherwise got.

Yes. Okay. And then net new business initiatives in the first half. Anything to call out there?

I think continued conversion from whitewood across both the U.S. and Europe and also Asia Pacific. So I think strong new business pipeline and the team continue to do a great job of converting in my view.

Okay, fantastic. And then I just wanted to ask, again, you've got still the 4 million pallet surplus in the U.S. But you're still expecting to get the same benefit in FY '26 and you're still expecting to reach optimal levels in FY '27. I was just wondering if you could, I guess, reconcile those comments for me, please?

So in the first half, we finished, as you said, the same level of excess pallets, which was $4 million in the U.S. as we finished FY '25. And and essentially, any pellets required for both replacement and growth came from Latin America, the flows from Latin America. As we've talked about a little bit in our outlook considerations in the second half, we expect some improvement in U.S. consumer demand. And so based on our current forecast, we'd say by the end of first half we would expect to have worked our way through the 4 million excess pallets.

And that obviously hasn't changed since the first -- into August?

Yes, that's right. It's just based on the forward look at demand and also expectations on Latin American flows.

Your next question is from Peter Steyn from Macquarie.

At full year '25, there was considerable conversation about measurement and measurement intent gone. Is there any update on progress around your thinking there?

So management intends on what.

Just management measurement?

The LTIs and things like that. Yes. Okay. Yes. So the issue was if you look at the metric -- one of the metrics that's used for -- it's that grid of sales growth and ROCE performance. And it was clear that -- and again, 1 of the pressures that Remco is always under is to ensure that the you're not paying for backwards performance, however unrealistic that is sometimes. So the grid was increasing the range on sales growth. We're at yet at the same time, we were saying, look, look at our investor value proposition, which is saying low- to mid-single-digit growth on top line and then leverage on the bottom line.

So there was clearly becoming a bit of a disconnect between that grid and the investor value prop. So what we are going to try and put in place for next year, so FY '27 onwards, is a revised LTI sort of a setup whereby there's still the RTSR piece in there. But there's also -- rather than that ROCE sales grid, there will be something much more closely aligned with the total value creation that comes out of the investor value prop. But that is, of course, subject to us, in fact, not as it be the Chairman and the Chair of the Remco going around to the investors and the proxies and getting their buy and that obviously then go to a vote at the AGM in October.

So that's the plan, which I think from a management perspective, much more closely aligns with what we're trying to do with what we promised to deliver on the investor value prop. So that's -- yes, that's what we're working on at the moment.

Yes, which I suppose an comes back to the comments you made about customer value proposition and Net Promoter Scores and U.S. pallet repair costs and damage rates. I'm just curious to draw the line to that and get your perspective on your repair status at this point. Joaquin made the point that it's really about incremental utilization. Just wanted to be really certain there that you guys are very comfortable that you've got that balance right and that there's not a perhaps a backlog in repair building at all?

Yes. I mean I think -- in the past, the distant past, hopefully, there's been an opportunity or it a play to not spend the money on repairing pallets to boost the P&L in the short term. But I think that lesson has been well and truly learned and that we cannot sit here and say that in terms of our customer value proposition that we are going to deliver the premium service with the premium product when our customers need it if the pallets aren't up to the spec. So we are putting every effort we can to make sure that, that is front and foremost of everyone's minds. Almost the point of treating product quality along the same lines as safety.

So there will be no delaying of spend, both capital if it means putting quality at risk. So that's our philosophy. And I think that's sort of very much what akin was talking about in terms of we're continuing to push that through because as we start seeing volume and demand pick up, we need to make sure we have enough high-quality pallets ready for the customers, and that's always been what we try to do now.

And I think sorry, Peter, I was just going to say the proof point of that, I think, is our pooling CapEx to sales number at that 11.8%. So if we were buying pellets, if I call that unnecessarily or to avoid repair, then you'd see a spike in that KPI.

Your next question is from Owen Birrell from RBC.

Just to start with it. I just wanted to ask a question about the $4 million of surplus parts at the moment. you confirm whether they are repaired in the service or still yet to be repaired. And I just wanted to get a sense as to what the current storage costs of keeping those pallets -- and you did mention relocation costs of pallets at the moment. I'm just wondering, are they costs that are going to unwind into the first half of '27?

Thanks, Alan, and good morning. So pellets are stored not being repaired. So as they come out of storage, they're repaired. In terms of plant and transport ratio, what you can see is that despite obviously continuing to incur storage costs at a slightly higher level than we expected. We're still being able to deliver really good margin improvement and efficiency in that ratio. I think for me, the step change that you're talking about, to do with storage comes after we've worked our way through those pallets. So I would see that happening post first half '27. Does that help?

I just try to give guess what the magnitude of that would be.

I think, Owen, as you'd appreciate, there's a lot of moving parts. So I think what we really tried to do to help everybody was give you what we expect the full year plant and transport ratio to be, and hopefully, that allows you to work back.

Sure. So that's about 1 percentage point improvement that you're sort of talking to.

Exactly, Alan. Yes.

So just second question for me, just looking at the growth splits in the Americas, at 10 and 9% sales growth, Canada, 6% sales growth significantly rising that Americas, I guess, percentage. Just wondering if you could give a sense of a sense as to what was happening within price and net new wins across both of those regions. Was it all price across both? Was it all in wins across both -- just give us some flavor there?

Yes. So I think, Owen, obviously, when you look at at Lat Am, what we saw a dynamic of, obviously, strong price realization to recover cost to serve increases, saw good momentum in net new business. but then some challenges around consumer demand or organic like-for-like volumes. If you then look at Canada, again, pleasingly, against strong net new business wins. -- in Canada. And again, that recovery of cost to serve or inflation. So they were the key drivers, whereas like-for-like volumes in Canada were more or less flat.

Okay. That's great. Just 1 final question while I've got you. There's been a lot of in the market around AI impact on companies. Just wondering if you can give us a sense as to whether you think Brambles has I guess, great opportunities or greater threats from the AI?

I mean I think 1 of the good things is we've been using AI for a while. So this is not like there's a a big step change we have to make. So we -- if you look at some of the -- because it also obviously it depends on your definition of AI. It can range from everything from machine learning, use of digital optical capabilities when you're looking at plant repairs. So all that stuff we've been doing obviously, the stuff we're doing around S+ and the whole digitization of the supply chain relies a lot on algorithms and AI.

So we think there's plenty of opportunity. I think particularly when you start looking now at back office processes, there is a lot to be done. And the interesting thing is the technology is changing so far that you just got to try and pick your moment to start implementing it. And our approach has been very much let's look at the processes that we think have got the most opportunity to streamline and then apply AI to improve that process.

And we've been -- we started to work on that. I think it's 1 of those things that will be going on probably for a very long time as particularly as the tools get more sophisticated, but we're certainly embracing that and seeing benefits from it already, I would say.

Your next question is from [ Jacob Cakarnis ] from Jordan Australia.

Well done on a good result in a tough operating market. I just had 2 questions, if I could, please. Just on CHEP EMEA. Can you just help us through the dynamics through the second half? It looks like the timing or realignment, I guess, on the audits will give 1.5 percentage points of growth. But I just wanted to drill in on the expectation that, that will be back into EBIT growth through the second half. Can you just help us -- what are the other initiatives there some cost savings? How do we think about that, please?

Yes. Thanks for the question. You're exactly right. So 1 thing is that IPEP timing reversal. We expect a slight acceleration in net new business wins and then improvements in the plant and transport ratio in the second half. So there's the 3 key drivers, I'd say, of the improvement in the EMEA performance.

Okay. And while I've got you, Joaquin, just given the strength of the free cash flow as interested in the outlook that you're basing some of the nonpulling CapEx items, particularly ones that we could maybe argue are more important to the longer term just on automation and serialization flats. I appreciate it's at the margin there. But -- can you just give us a sense of why those programs have shifted to the right a little bit? How do we think about that going forward as well?

Yes. And I want to assure you, we're very much committed to investing in the business and building the business for the long term. It's a combination of things really in terms of that non-higher stock CapEx. So the first one is -- when you look at some of our things like end-of-line quality systems that we're putting in at the moment, there's technology changes that are coming rather than invest now, we've just delayed that slightly, that will be into the first half of '27.

So I think, again, what that shows is a good disciplined approach to capital allocation. But I think for me, what's pleasingly is we've been able to find other initiatives that are either CapEx light or don't involve CapEx to still make sure we're delivering the financial performance.

And then on S+, it's again just timing of rollout. I think as Graham touched on, we've essentially moved the market to the effortless service offer. But to make some further investments, we -- as we work through the U.S., for example, we need to see some terms of those pallets to get a better understanding, and we continue to work through technology mix. So for me, it's not about us not wanting to invest. It's more about making sure the technology and the availability of that technology for that investment.

And then just to follow up on SPs in the U.S. Joaquin, is that going to be supported by customers initially? Or is that off, I guess, a proof and evidence sort of arrangement and then that conversation happens later on?

Yes, Jake, I think it's very much Chile will be a great example then to be able to take 2 customers and say, look, we've done this in Chile. Here's what we think the benefits are both to you and to us. And here are the improvements we can get in your efficiency. So we can use Chile as a sort of a reference case, if you like. But the other good -- of course, good news is being a global company with global customers. Some of the customers in Chile are also customers in the U.S. So already, we're pretty sure that some of them are talking to the counterparts in the U.S. saying this is working really well. And that will help again with the introduction of S+ if we decide to roll this out in the U.S.

Your next question is from Matt Ryan from Barrenjoey.

Just had a question on the new business wins. I think from what you've said that sort of offsets the volume decline to the second half -- so just hoping if you could give us some color on the wins that you're getting either by size or geography.

Yes. I mean it's pretty evenly spread across the geographies. I mean everyone is doing a great job. And I think for us, the confidence is around looking at the pipeline. So one of the investments we made a few years ago around -- into Salesforce, it gives you that much more granular view about what is coming down the pipe and what the probabilities of converting it -- and I think that's -- I think we made some predictions about 18 months ago about the conversion of the pipeline, which has been pretty accurate. So it was a bit slow to start off with.

So I think we've got a very good view now about what's happening. And the majority of it is converting whitewood users into CHEP pallets. So again, it's not going to disturb any competitor balance in the major markets. It's about these new customers you want to to move into a pooled environment. So I think we're pretty confident about it. We've got pretty good visibility for the next 6 months. So we wouldn't be saying what we're saying. We didn't have some pretty good visibility.

The only caveat is a point that Joaquin made earlier. if you win a new customer, you assume the existing level of activity, but if consumers generally are buying less, then it just takes longer to get up to the level you assumed when you won the business, but we haven't really seen it as a material issue so far.

And just a follow-up on that effortless service model. Are there any differences between Chile and the other markets that you're looking at?

I mean I would say the biggest 1 is just scale. I mean, so 1 of the reasons we chose Chile was it's a fairly contained market. And therefore, getting a good view about just how the data works in terms of using the algorithm to come up with the effortless service offer. Things like, for example, if you have a very small customers in Chile, you can't necessarily look at them customer by customer. You might have to aggregate them into subsector groups and segments.

Now in theory, that might be a lot easier in the U.S. because you don't have quite so many -- there's even small customers are quite big compared to July. But other than that, yes, you've got some operational differences like the the climate makes the performance of the glue and the tag different, but that's stuff that we'll just crack on through and sort out. And that's one of the reasons we're doing -- the trials we're doing in the U.S. already is to get ahead of those sorts of issues.

Other than that, no, I think pretty similar. Clearly, you've got some slightly different dynamics of the retailers versus U.S. versus Chile. But other than that, we don't see it as a major difference.

Your next question is from Anthony Moulder from Jefferies.

If I can start with the U.S., you've said that you're scrapping more pallets in the U.S. and -- you've also talked about a higher damage rate. I'm wondering if those 2 issues are related. And specifically, what's driving that higher demethanthe U.S. fleets?

Yes, you're exactly right. What we're seeing is the pallets are experiencing more damage and that means more scrap. -- pallets. And that's a combination of things, obviously, as you inject less new pallets into the pool, then while they fit for purpose for customers as they come back, the damage tends to be a little higher.

And picking up on the previous comment about the geography of growth. I think you said during the comments that the growth in net new wins in the Americas was Latin American-focused. What why aren't you growing into the white pellet space in North America, please?

No. Sorry, Anthony, may be my fault here -- the question was around the Americas and given that we already split out the U.S. I covered Canada and Lat Am. But if you look at the U.S., we had net new wins of 4% in the first half.

Right. I bet you're not using those surplus million pallets in the U.S. Would you use those if growth was originating in the U.S.

You would, 100%. And the impact was really because we saw consumer demand or like-for-like volumes down. So the in the first half, the volume that the U.S. needed for either replacement or to meet growth came from Latin America. And the difference is really that decline in like-for-like volumes of 3%. So then as you look out to the second half and into first half '27, we expect obviously like-for-like volumes to improve good momentum on net new business, and so we'll work our way through those 4 million pallets.

Okay. The overhead costs, you've called out is it $15 million savings for FY '26 on top of the $35 million from FY '25 and next year, 105 of what we thought was about $189 million of overhead. Is that the appropriate level of overhead to keep in the business beyond FY '27, please?

I think I look at it a different way, Anthony, rather than have a target for what does overhead need to be. It's about making sure we invest to drive the growth in the business and long-term success. So similar to the answer we gave during transformation, we're investing where it's right. But as we touched on, we are also looking for productivity initiatives and making sure that we're doing what we can. So how I would more look at it, Anthony, if I was you, is we gave our margin improvement target of 3 points plus by the end of of the FY '24 baseline. So you can see how we're progressing on that. And then we've set asset productivity, we're more or less where we're mature in that with still some opportunities to go. We know overheads and supply chain.

Okay. And lastly, if I could, the cost to serve benefits now being shared with customers since the Absa price impact, how specifically should we think about cost to serve benefits for customers impacting price going forward, please?

Yes. I think, Anthony, this is one we've chatted a little bit about which it really is about us recovering the cost to serve. So where a customer can help us lower the cost to serve, then we share that benefit. So I think how I would look at it is, ultimately, this is about margin, profitability and free cash flow generation. So depending on the cost to serve, we'll recover it through pricing. But obviously, it's a win-win if we can lower that cost to serve and customers pay less.

Less to going down into NPDs and the like. Is that a key component of that transit, please.

Now I think what it's more about is 2 things that I think are really great. Obviously, the investments in technology like Ultra devices have turned NPD lanes that were initially very high cost to serve lower cost to serve. And then obviously, customers assisting in converting customers or improving controls at MPD customers, so there are less losses. So it's not about not servicing customer demand here. It's just how can we all do it at a lower cost.

Your next question is from Andre Fromyhr from UBS.

First question is just about the composition of sales and in particular, in the guidance commentary. So if I understand, you're suggesting that net new business would sort of track similarly in the second half at around 2% price similarly around 2%. So at the 3 to 4 group level implying sort of a like-for-like in the minus 1% to flat environment. So is that a fair read?

And that implies actually positive like-for-like in the second half, not just improving. So what gives you that confidence on the -- at especially on the consumer side of like-for-like following the last few years that we've seen in like-for-like trend.

Yes. Thanks, Andre. And look, your interpretation of theFY '26 outlook considerations is broadly in line with ours. I think the things that give us confidence as you look out as we get to the second half, we are cycling easier comparatives from the prior year. So that's essentially 2 points of decline, the recycling. And then you look at expectations on the U.S. consumer demand as obviously, there's been some tax changes, et cetera, you have the World Cup -- so what we wanted to do in the outlook considerations is very clearly lay out our assumptions and then people can form their own judgments as well as ours in terms of what they expect to happen to consumer demand.

Okay. And then expanding that into the EBIT guidance, can you help us understand what has changed in your expectations since August by -- and just in terms of the ability to still be able to attain the top end of the underlying profit range given we're now expecting the sort of lower end of the sales. Does that make sense?

Yes, that does. I think a couple of things, Andre. One is obviously, it depends where you sit on the sales revenue guidance of 3 to 4 million -- then when you look at our productivity and efficiency improvements, in particular, in supply chain, it depends how successful we are at those. So if we were to overdeliver then that gets you to the top end of the range. And I think IPEP is another one, I think, really pleasing progress continuing in the Americas, some challenges in Europe. We're confident in our plans for the second half, but that is also a swing factor. So a range of moving parts, but we're still very confident with our guidance.

Okay. And then last one for me is just on serialization plus, in particular in the U.S. You've referred to continued rollout of the REIT infrastructure there at the moment. So how much of a sort of precommitment is that on the project? Like are we still considering a scenario where you decide not to go ahead with S+ is it more like you'll do it at some point, but it will take your time to make sure you sort of learn the most you can out of Chile another example.

I mean I think when we talked about the -- putting the read infrastructure into the U.S. in the first place, I think there were a couple of considerations there. One is -- there's a lot of the spend, we think, is no regret or little regret because we can use a lot of the cameras, for example, in the repair line if we wanted to, if we start not to go ahead with.

The other thing, though, is that I think the initial readout from Chile is looking very promising. So this would be to get to value quickly putting the read infrastructure in, given that it's is low regret makes a lot of sense because then when you put the instrumented and tagged pallets into the U.S., you'll get value much quicker. So that was sort of where we were coming from. I think that was 6 months ago, roll-forward now we had this target of trying to convert 100% of the customers to the file service offering in Chile, we're at 95% at the half of the year -- first half last night, we got another 1 converted, so we're pretty close to 99% now. So again, that is great.

But to really prove out some of the use cases and the value cases. We need the assets in those converted customers to turn 2 or 3 times -- so -- and that therefore means 9 months-ish. So I think we're talking now about let's just make sure we've got the data to absolutely cross the Ts, dot the eyes on the value cases -- we're getting a much closer, better idea about the cost because we've now gone through various situations of that.

And then we can make the decision. So we're not -- we haven't decided to roll it out yet, but it's fair to say we are getting close to that point. And all the green shoots are there, but we still want to the capital discipline point that Joaquin mentioned earlier, we're not going to do this unless we're very sure that we'll get the 15% return on investment.

Your next question is from Sam Seow from Citi.

Just a question on margins, in particular, Slide 15 there -- on supply chain, the productivity is about 80 basis points. So that looks like a up almost 240 basis points year-on-year. So just wondering, one, if you can talk about what the big drivers there were? And two, as we think about the future, do we expect that additional margin expansion, call it, 120 basis points to come incremental to normal operating leverage? Or is that just included in it?

Okay. I'll have a crack at the first question. The second one was a little tougher. But I think your read of the supply chain productivity is right. And essentially, what has driven that is, I would say, procurement initiatives. So we've got enhanced processes in terms of our procurement. -- transport productivity and plant optimization. So I think the team have done a great job of looking at the network, understanding structures, where could we make improvements in our plant network.

And obviously, we continue to get the benefits from automation and the durability investments where we've invested. Your question, I think, was on the margin improvement as we look out.

Yes. Is it going to be incremental? Or do you think it's just normal operating level?

Yes, I'd sort of bring you back to just our investor value prop and how we think about it, which is that we would expect to be delivering high single digits UOP growth. SP-13 Got it.

Okay. Okay. That's helpful. And then maybe on that asset efficiency line, IPP not a contributor to this result. You said that lever is mature and plus or minus we expect as a percentage of sales that's going to be largely flat. So just wondering with S+ yet to really fully roll out, is that going to be incremental to your press kind of PEP to sales commentary? Or should we see the benefits as S+ in those line of things?

Sam,, you're exactly right. So we've been talking about that sort of target of Pepta sales at 1.6% of sales. That is pre-roll -- and then the benefits of SPs, I say we'll see not only in asset efficiency, but we'll see it in all lines of the P&L. So helping with revenue in terms of attracting that new business, retaining existing customers, supply chain productivity. So I think there's a broad range of benefits that could come from S+, but asset efficiency is definitely 1 of those.

Got it. Got it. And then lastly, on net new win. Is there like a number or percentage or a stat you can give us that kind of explains the wins coming from white wood from NPD or expanded lanes, as you call it. Just trying to get some insight into these new customer wins that basically aren't coming from competitors and you're seeing the benefit of those expanded lane?

Yes. I mean I can give you an indicator, which is most of it's not coming from competitors. That's your indicator. We're telling you it's not -- it's coming from competitors. It is the majority, as you just said, is white words and then there's a chunk of new loans. I think if you look -- if we look back over the last 18 months in the U.S. market, for example, our estimate of the market share movement between us and PECO, who obviously the major competitor, it's minimal. I mean it's almost 0.

So yes, there have been some ups and downs, but over that 18-month period, the relative market shares haven't changed. And that's obviously our analysis is hard to get the numbers because they're not a public company, but that should give you some confidence that it's largely coming from whitewood and other lines.

.

Your next question is from Cameron McDonald from E&P.

Two questions from me. Firstly, just in that outlook with the improved volumes that you're expecting to see gather the -- we've got the point about the weaker PCP in the second half as well. But we've seen a range of companies come out in that CPG space. talking about having to discount to drive volume growth. What are you seeing and what engagement are you having with some of those customers around their expectations around discounting or promotion?

So when we talk to them, I mean, one of the interesting things is we're interested in what their volume view is and whether it's coming from discounting or not, is not irrelevant to us, but certainly, we just want to know what they think the volume pattern is going to be like. And I have to say the majority of the ones that we talk to don't actually know. I mean I think it's such a volatile environment out there that it's very hard for them to predict and therefore, it's hard for us to predict.

The only sort of signs that we see are that there seems to be a slight uptick in U.S. consumption. It was looking very good in January and then they had the big winter storm snowstorm, which may put a bit of funds into the equity of the data. But again, looking into February, I think it's beginning to look good back on track again. So that's very, very green shoots, I wouldn't want to call that yet, but it feels like -- if you put that in conjunction with potentially some of the tax changes in the U.S. and the World Cup coming up, which sort of gives us a bit more confidence that the U.S. certainly appears to be going the right momentum.

Europe is very difficult because it's not 1 market. Some parts of the continent doing pretty well like Iberia, others not so well like the U.K. and Germany. So it's very mixed in Europe, much harder to predict. But that's -- and yes, our customers are saying the same thing it's hard for them to predict.

And you've mentioned the weather, Graham. I mean a few companies have called that out. What do you think that headwind for the has been in terms of sales in -- early in the second half?

I don't think -- so it's U.S., clearly. I don't think it's been more about disruption to the supply chain and cost to then catch up. I think -- some of the sales I've been hearing you, they are catching up in February. So they're not lost forever. Some of them will be, undoubtedly. But it's not going to be material from what I see at the moment.

Okay. And can I also ask about serialization+ in Chile. And thanks for the examples of some of the benefits. Joaquin, you're probably going to expect this question, but can you actually give me some quantification of what those benefits have been either numeric or operationally in terms of what the improvement in either the turn rates or the margin or anything other than just anecdotes?

I'll do my best here, although as Graham talked about, we're really keen to see a few more turns in the Chile market. But I think Slide 8 was our attempt to give you when you look at the serialization plus value scorecard areas where you might see value. And I think, Graham, in the answer to one of his earlier questions, is a really good example of that. If you think about damage rate in the market, -- it's been very hard to know where has damage occurred.

So it comes back, but that pallet may have gone from a manufacturer to a retailer and back to us. what the team have now been able to do in Chile is you can map essentially the flows so you can understand in this leg of the journey, the pallets being damaged. So then that allows us to take action either training of staff, thinking about how we do it. So I think that's one. Net new wins. We've seen some progress there, where customers have converted to our offering in that market because of the lessening of the administration burden and the insights that we can provide.

So I think for me, there's a whole range of benefits, but before we wanted to put numbers on a page and say this is what it looks like, we need to see a few more turns. And then obviously, before we made it full decision to roll out in the U.S. will present an update on what's happening in Chile and why we have confidence in returns. So it may not have fully helped to Cameron, but hopefully a start down that journey.

Yes. Well, I think to put you on notice, you're going to -- if you come back and ask for a couple of hundred million dollars worth of support investment, you're going to have to give us some actual data, right, in terms of what the returns have actually been.

And so just in terms of the hurdle of presumably because you haven't either had enough turns or you have not decided yet to execute the full rollout -- can we read that as being you have not reached a 15% return or you do not see an immediate pathway to 15%.

So a couple of things, if I can just chip in. One was, firstly, I'd expect nothing less than the staff to give you a really solid proposal. And let's be honest, Cameron, I wouldn't approve it if there wasn't a solid proposal. So I think that's a very reasonable ask go and you have our commitment on that.

And then I think what we talked about on the 15% return is that was annualized after a pool that's been fully serialized. So when you think of Chile, Graham touched on it earlier, we're essentially fully at the ESO offering. So that's why we think we need another 9 months or so to be able to show the returns and have confidence in that number.

Okay. Great. So halfway through first half '27. So at half year '27 results, you're going to have -- it's a decision point effectively. SP1 Yes, I'd say somewhere between sort of that point and 30th of June, let's say, roughly, right? So very hard to be fully specific. 9 months from now, it's a little longer. But obviously, if we had enough information at the February results, we would share it. I mean, we're very conscious that once we're in a position and we have the information, then we will share it with the market.

Your next question is from Scott Ryall from Rimor Equity Research.

Perfect. -- an -- can just noted down 19 November, just so you -- now I had a question on Slide 8 as well, and it's not for quantification, but I think Casson the right-hand side of your progress today, you talk about customer conversions and mine expansions. You've talked about the customer experience, and I'm wondering if this -- and then you've also talked about insights. Could you just talk about the noncustomer experience. And I guess that the reduced admin burden simplified billing model, I get that, that's pretty clear when you do serialization. But -- just what are the other benefits that you're seeing in the early stages that customers are finding that's helping you win business, please?

I think, Scott, the main one is it's easier to do business with us. I think that is the main one. I think as we start using the tools at S+ and ESO is giving us in terms of working with the customers to show them exactly where some of the damage is occurring or where some of the losses occurring so that we can then work with them to improve their supply chains, their businesses, take waste out of their operations. That is what I think that will start making a big difference for them and for us. But at the initial go-to-market proposition is -- you don't have to do with these audits and declarations. That's what's got us to the business so far.

Okay. So it's still pretty preliminary on those further assets around helping customers take out ways for most things.

Yes.

And then I'm just coming back to the pallet balance being optimized in your comments about the U.S. pallet balance being optimized by the end of first half '27, so end of calendar year. Does that -- what's the implications with respect to CapEx levels once that happens, please?

Yes. I think we -- that's why we've really tried Scott to quantify the CapEx benefit. So -- in this half, we haven't had any. I think if you look back on what we said for the full year FY '25, roughly quantified that as 0.5 point. But obviously, that will vary depending on volume growth, et cetera. But I think the key message that I would take away from this is the asset productivity and cash flow performance is sustainable. It's not driven by the use of excess pallets.

So Joaquin, just to follow up on that. So because I remember that feedback you gave at the full year. And that was I was a bit confused with the fact you've still got surplus pallets, but you've had no benefit in this half, but yet that the surplus will be will be optimized by the end of this calendar year. So why is it.

So that means relative to the fiscal '25 number, it's kind of 0.5% or is it -- is there another way of thinking about it on now? Just confused about what you're saying.

Yes. I think another way maybe that might be simpler is we've often quoted a rough rule of thumb that is 1% of volume growth is 1% of pooling CapEx to sales. So the way I look at it is the business delivered 11.8% pooling CapEx to sales with essentially flat volume. So then if you forecast volume growth at a group level, let's say volume was 2%, then you would add 2%.

So -- for me, it's got another way just linking back to that is if you think about Investor Day, what we said is you should expect pulling CapEx to sales to be in the $15 million to $17 range, and that was based on 2% to 4% volume growth. So were essentially in line with that, if that takes all the noise away of excess pellets, et cetera.

Your next question is from Niraj Shah from Goldman Sachs.

Just another question on Chile, following up on Matt's earlier question on the differences between Chile and say, the U.S., for example. Graham, I think you said that the biggest difference is scale, I guess, both of the market and the competitors. Does that mean the market structure is similar like is the pooled solution roughly half the market and you guys are kind of 80% of that? I'm just curious.

Our -- we are -- of the pooled market, we are bigger than 80%. We've got a small competitor in July, not a PC-like competitor. And the penetration of the market, I'd have to double check, but I would think it's probably a bit more penetrated actually, maybe it's not. I mean maybe it's probably about the same as U.S., I would guess, but we'll have to check that out.

[Operator Instructions]. There are no further questions at this time. I'll now hand back to Mr. Chipchase for closing remarks.

Well, thanks, everyone, for your questions and for joining the call. Looking forward to seeing, I think, most of you over the next few days. So we'll have more questions then I'm sure. Thank you very much.

Well, good afternoon, ladies and gentlemen. So my name is John, John Mullen, and it's a great privilege as Chair of Brambles to welcome you to the 2025 AGM and to declare the meeting open.

There are copies of the notice of meeting and of the minutes of our last AGM in the registration area. And our Company Secretary has advised me that there is a quorum for the meeting, and I propose to take the notice of meeting as read. Thank you.

I'll start by introducing your directors. I will then take you through the process for asking questions. Our CEO, Graham Chipchase, is not with us today. This is due to the exciting news of a very recent arrival of a baby daughter, for which we congratulate him and his wife, Sarah. As a result, instead of a separate Chair and CEO address, as would normally be the case, I will try to cover both agendas myself. However, Graham will be available via telephone during the Q&A session, if there are any questions that are directed specifically to him.

Maxine Brenner, Chair of our Remuneration Committee, will also address the company's remuneration policy, and I will then take you through the voting procedure and answer questions from shareholders. We'll then move to the formal part of the meeting.

So I'd now like to introduce your Board. So joining me here today on my far left is Cameron McIntyre; Kendra Banks; Ken McCall; Elizabeth Fagan; and Maxine Brenner, Chair of our Remuneration Committee. On the right is Vik Bansal; Priya Rajagopalan; Jim Miller; Nora Scheinkestel, Chair of our Audit and Risk Committee; and Carina Thuaux, our Company Secretary. Tony Palmer, as our other director, he will not be joining us today as for personal reasons, unable to travel from the U.S. today. Also with us today sitting in the front row, are Debbie Smith and Natalie Maxwell from our external auditors, PwC.

Then please see on the screen, the evacuation map for the Paradox Hotel. I would note that there are no planned evacuation tests scheduled for today. But in the event of any alarms or emergencies, all attendees, obviously, should follow the instructions of the Paradox Hotel supervisors and staff. They are fully trained to manage any such situations and ensure everybody's safety.

Now we are webcasting this meeting for the benefit of shareholders who could not attend in person, and we will retain an archived version of that webcast on our website.

There are 2 ways to ask a question today. If you're attending in person, you can ask a question from the floor. If you'd like to do that at the relevant time, please approach the microphone, show your green voting card or blue nonvoting shareholder card and give the attendant your name. When the attendant announces you to the meeting, you may then ask your question. If you're unable to get to a microphone, then please raise your hand and an attendant will bring a microphone to you.

If you're a shareholder viewing our webcast, you can ask a question by selecting the blue hand icon at the top right-hand side of the webcast window. This function is available now, and questions can be submitted at any time. You will not be able to vote on any of the items of business via the webcast. So although you may start submitting questions via the webcast at any time from now, I will not answer those questions until the relevant time in the meeting. And the company secretary will read out questions verbatim on your behalf. Although questions may be moderated, and if we receive multiple questions on the same topic, amalgamated together. We do appreciate the time that it takes to type in a question. So if we move on in the agenda before you've submitted your question, we will answer it at the end of the meeting.

And as I mentioned earlier, Debbie Smith from PwC is in attendance and available if any shareholder wishes to ask her any questions about the conduct of PwC's audit, their audit report, the company's accounting policies or the auditor's independence. You can ask Debbie a question using the same function, which I just outlined.

We will be holding a poll on all the resolutions before this meeting. Any shareholders attending the meeting in person and who wish to leave early, may place their completed voting cards in the ballot boxes by the exit doors. I'll explain the voting procedures when we get to the formal part of the meeting. So I'll now open the poll and turn to my address.

So as we reflect on the past fiscal year, I'm really truly proud of the progress that we have made in transforming Brambles into a digitally enabled organization that is more customer-centric, financially robust and sustainable than ever. Through our Shaping Our Future Transformation program, which we announced back in 2019, we have structurally improved the fundamentals of our business, enhancing Brambles' value proposition to our customers, increasing our competitive advantage and resilience while establishing the foundations in data and digital that are critical to our future success.

This year also marked the conclusion of our ambitious 2025 sustainability program, which has demonstrated the clear and enduring business value of our circular model, reaffirmed our leadership in sustainability and paved the way for the next phase of our regenerative ambition as embodied in our 2030 sustainability targets. Together, the benefits of our transformation and sustainability programs not only delivered strong financial, operational and sustainability outcomes in 2025, but also created a step change in the value that Brambles creates for our stakeholders.

Starting with the value that we have created for you, our shareholders, a core commitment was made for our transformation to ensure that Brambles consistently delivered operating leverage and sustainable free cash flow generation. I'm very pleased to report that we have delivered on that promise. Over the past 4 years, at constant currency, we have achieved a compound annual growth rate in revenue of 8% and an underlying profit of 14%. In the same period, we generated an average annual free cash flow before dividends of USD 640 million, up USD 170 million on the average of the 4 years prior to the transformation. And for the first time this year, free cash flow before dividends exceeded USD 1 billion. So this sustained improvement in financial performance translated to total value creation for shareholders of approximately 17% in 2025. This was achieved through growth in basic earnings per share from continuing operations of 14% at constant currency, which included a 1 point benefit from USD 403 million on market share buyback that we completed during the year.

In addition, the dividend yield for the year was approximately 3%, with total dividends declared increasing 17% year-on-year to USD 0.3983 per share.

Of course, these financial outcomes would not be possible without increasing the value that we create for our customers, our employees and the environment and communities which we serve. Our commitment to our customers has been unwavering. And while there is more to do, we have significantly improved their overall experience and increased the value that we bring to their supply chains. We have enhanced service levels, simplified customer interactions and use data analytics to deliver insights that enhance the efficiency of their supply chains. Importantly, we also continue to invest in the quality of our platforms and are increasingly applying digital insights to identify opportunities for collaboration to unlock shared value and efficiency. And this focus on enhancing the customer experience has led to strong improvements across core customer performance metrics, including a significant increase in our Net Promoter Score against the FY '21 baseline.

For our people, safety is paramount. And the reason we focus on the critical importance of having the right culture around it. Our safety-first strategy and investments in our service center network have reduced Brambles' injury frequency rate by more than half since FY '21. And we continue to target zero harm for all our employees.

We have also strengthened the diversity of our business, including a 7% increase in the percentage of women in management to 38.8% at the end of FY '25 as compared to FY '21. We're very encouraged that our efforts to make Brambles a safer, more diverse and rewarding place to work have been recognized globally, with Brambles named a top global employer for a third consecutive year and maintaining this certification in 26 countries.

For the environment and the communities we serve, our transformation, combined with our 2025 sustainability targets, have strengthened the inherent sustainability of our circular share and reuse model and delivered more positive impacts in every region that we operate. During the year, we maintained the use of 100% certified timber globally. We enabled the sustainable growth of 2 trees for every tree that we use in our business, and we continue to actively work to expand forestry certification uptake in all regions.

Strong progress has also been made against our decarbonization plans, and we remain on track to achieve our 2030 science-based targets.

Having reduced our Scope 1 and 2 emissions by 32% and Scope 3 emissions by 17% against an FY '20 baseline, we continue to progress towards our ultimate ambition of reaching net zero emissions by 2040.

Over the course of our 5-year program, we've also demonstrated the value that our sustainability leadership brings to customer engagement. The number of customers collaborating with us on sustainability projects has more than doubled since FY '21, while the number of sustainability certificates provided to customers has grown from 684 in FY '21 to more than 11,000 in FY '25. And while we judge our performance based on how we track and measure against our ambitious targets, it's always validating and a deep source of pride for our people to see the ongoing external recognition of Brambles' sustainability credentials, including by TIME Magazine, which ranked Brambles the third most sustainable company in the world.

These results underscore the collective benefits of our transformation and sustainability programs in delivering structural improvements across our organization that support value creation over the long term.

Looking ahead, our vision for the Brambles of the future is to connect and illuminate the world's supply networks, making them more resilient and regenerative. Customers remain at the center of our strategy as we continue building an unrivaled experience that is truly effortless, reliable and anticipates their needs. From quality platforms and exceptional service to our use of technology to create effortless interactions, we will ensure our offering is seamless, flexible and fosters collaborative partnerships with our customers.

Our ongoing focus on operational efficiency will see us continuing to raise the standard for our share and reuse model that minimizes waste and improves the cost to serve. Advanced technologies, digital insights and best practice processes will help drive improvements in platform quality, increased productivity and enhance safety across our operations.

In continuing our sustainability journey, we will further integrate regenerative thinking across our value chain and move beyond zero impact to create supply networks that aim to replace what we take and create more than we need. We will also leverage our unique position at the center of global supply networks to better use our data to illuminate the flow and movement of our assets and our customers' goods. And this strategic element includes the work that we are undertaking to develop innovative digital customer solutions that reduce waste in supply chains, enhance operational performance and support the long-term sustainability of our customers' operations.

In fact, data and digital capabilities are integral to every aspect of this strategy and to our future success. And for this reason, we're encouraged by the progress that we're making with our serialization+ program. In Chile, where the read infrastructure is in place and the pool is now fully serialized, our focus has shifted to value creation. In this market, we have introduced an effortless service offer, which removes the need for pallet declarations and audits, eliminating a major friction point for our customers. Today, approximately 85% of our customers in Chile are already using this new model with the balance expected to move to the model by the end of this calendar year.

And in addition to transforming the customer experience, we have identified 4 additional sources of value across the business, including net new business growth and pricing optimization as well as asset and supply chain efficiency, which we plan to test and prove out during FY '26. We also continue to advance serialization+ in North America, where good progress has been made to date. In FY '26, we will expand our read infrastructure to target 2/3 of our asset flows as we evaluate the optimal technology mix and the associated investment required to implement serialization+ in this market.

The valuable learnings from Chile have reinforced the benefits that serialization+ can deliver for both our customers and our businesses and its potential to further strengthen our competitive advantage and reinforce our position as leaders in supply networks. We look forward to keeping the market updated on our progress with this very exciting initiative.

Building on the success of the 2025 sustainability program, we are proud to be renewing our regenerative ambition under the new 2030 sustainability program. While our vision remains the same, we now deepen our focus on nature-positive outcomes as a core principle of regeneration, while also pushing to expand our scope and impact beyond our operational boundaries.

This approach is reflected in our main targets, including the regeneration of 2 hectares of land for every 1 hectare required for our timber needs, shifting from the 2025 program's tree-based metrics to holistic nature-based metrics. Our focus on boosting circularity in our assets has seen us set a target of turning 80% of product waste into net positive solutions while substituting 80% of virgin plastics in new products with circular materials or solutions.

Turning then to our business positive goals and reflecting our desire to broaden the reach of our program. We will continue activating sustainability collaborations, aiming to reach 1,000 partners across Brambles Supply Network by building on collaborations achieved to 2025.

In our workplace, we are embedding diversity, equity and inclusion at the core of a new employee experience framework that boosts efforts to further increase the representation of women across all roles and levels, ensure equity and transparency in pay and strengthen accessibility and inclusion throughout our workplace. For communities, we will aim to drive positive policy impact by engaging and advocating on issues central to our business. And this includes promoting and accelerating the adoption of policies and programs that advance the circular economy and promote responsible business practices. Building on the core regenerative themes of the 2025 sustainability program, we're very excited about our ambitions and delivering our 2030 targets to extend our global leadership in sustainability.

Looking then at FY '25 financial performance in a bit more detail. Sales revenue on a constant currency basis increased by 3% and was achieved through price realization of 2% as cost to serve increases moderated across all regions and a 1% increase in volumes. Encouragingly, volume growth was driven by net new business growth of 2%, which accelerated to 3% in the fourth quarter as more manufacturers recognize the benefits of switching to Brambles' pooled solutions. This growth in new business offset a 1% decline in like-for-like volumes as increasingly challenging macroeconomic conditions led to softening consumer demand, particularly in the second half of FY '25.

Despite softer-than-expected revenue growth, the business generated significant operating leverage with underlying profit increasing 10% on a constant currency basis and margin expansion of 1.3 percentage points in FY '25. This reflected significant benefits from asset efficiency initiatives and activities to improve supply chain and overhead productivity.

Considering the strong margin improvement this year and the further efficiency opportunities across supply chain and overheads, we now expect the business to deliver at least 3 percentage points of margin expansion by FY '28 compared to the FY '24 baseline. And this represents an increase of 1 percentage point compared to the margin improvement target we set at our Investor Day in September last year.

Finally, free cash flow before dividends of USD 1.095 billion increased USD 212 million. This was primarily driven by lower capital expenditure, which benefited from a significant improvement in uncompensated pallet losses.

Despite ongoing macroeconomic uncertainty in key markets, we remain focused on key factors within our control, including maintaining our focus on commercial discipline, converting new business and delivering efficiencies across our operations. We are very pleased to reconfirm our FY '26 outlook expectations outlined in August 2025 of constant currency sales revenue growth between 3% to 5%, underlying profit at constant currency growth between 8% to 11% and free cash flow before dividends between USD 850 million to USD 950 million.

These financial outcomes, of course, are dependent on a number of factors. These factors include prevailing macroeconomic conditions, customer demand, the price of lumber and other key inputs, the efficiency of global supply chains, including the extent of retailer and manufacturer inventory optimization and movements in foreign exchange rates.

Before closing them, I want to touch on Board renewal. The stewardship of Brambles in support of its long-term strategic goals is obviously a vital part of the Board's role. To this end, we are grateful to have had 3 new nonexecutive directors join the Brambles Board in FY '25, who are up for election today. Vik Bansal, Maxine Brenner and Tony Palmer, offering their diverse perspectives and experience. We're very confident that their contributions will enhance our Board's effectiveness and support our long-term strategic goals.

As advised in September, Cameron McIntyre will step down from his role as nonexecutive director at the conclusion of our meeting today. We thank Cameron for his tremendous contribution to Brambles in a short time, and he leaves us with our best wishes for his new executive responsibilities as the CEO of the REA Group.

With the transformation journey, having delivered enduring benefits, our focus now turns to building the Brambles of the future, and we are more confident and excited than ever about the role our business will play in leading global supply networks over the years to come. We extend our gratitude to our dedicated team of 12,000 employees for their contributions and commitment to our customers, this business and each other every day.

To our loyal customers, we deeply appreciate your ongoing support and trust in our partnership.

And finally, we acknowledge our shareholders for your confidence in the work that we do and the value that we deliver. You can be assured that our focus remains on delivering value for our customers, our shareholders and our employees.

Thank you.

Good morning. At Brambles, we have a remuneration structure and set remuneration levels to ensure we can attract, retain and motivate high-caliber executives and talent throughout the company. Our objective is to align executive reward with the creation of sustainable shareholder value and align executive behavior with Brambles' strategic objectives, our code of conduct, our shared values and our risk appetite.

Remuneration is divided into 2 components, being fixed and at-risk remuneration. Fixed remuneration is not directly linked to performance, while at-risk remuneration is variable and directly linked to Brambles' performance.

At-risk remuneration has 2 elements. The first is the short-term incentive, half of which is received in cash, with the other half being received in deferred shared awards, which vest 2 years from the date of grant.

The second is the long-term incentive share rights, which vest 3 years from the date of grant, subject to the satisfaction of performance conditions, but they remain subject to a further 12-month holding lock period after vesting.

Half of the LTIs are subject to financial performance conditions. The other half are subject to relative total shareholder return performance against 2 external indices. As part of our review of 2025 remuneration outcomes, the Remuneration Committee carried out its annual assessment of any behavioral events or incidents, which occurred during the year that might warrant adjustments to all or part of an executive's incentive-based remuneration. I am pleased to report that no such incidents or events were identified through this process.

Given the strong operational performance and transformation momentum this year, the STI outcomes reflecting underlying profit, cash flow from operations and personal objectives were assessed at up to 127% of target. Similarly, given significant increases in total shareholder return and sales growth to return on capital invested performance, an outcome of 95% of the long-term incentive opportunity vested.

For executive leadership team roles, the Remuneration Committee undertakes an annual benchmarking exercise to ensure that executive pay is aligned to the company's objectives and performance while also maintaining our ability to attract and retain the right talent in the geographies in which we operate.

Following the annual benchmarking exercise and a 2-year base salary freeze covering F '24 and F '25, the committee approved an average increase to base pay of 3%, aligned with relevant geographical market movements. This applied to the CEO and members of the executive leadership team, including executive key KMPs.

During F '26, the Remuneration Committee will undertake a comprehensive review of the appropriateness of our current executive remuneration framework, particularly in the context of our operations and earnings in both the European and U.S. markets. In addition, consideration will be given to how a revised remuneration framework supports our investor value proposition and future business growth.

For those of you who would like more information on our remuneration strategy, further details can be found in the remuneration report on Pages 56 to 77 of our annual report, which is here and which will be subject to shareholder approval later in the meeting. Thank you.

That wasn't the result of a disagreement in the boardroom. Great. Thank you. Thank you very much, Maxine.

So I will now take you through how to vote. If you're entitled to vote, you will have been given a green voting card. You can vote on each resolution by placing a cross in the for, against or abstain box for the resolution.

And ladies and gentlemen, before moving to the formal part of the meeting, I will now answer questions from shareholders. I remind you that only shareholders or their proxies or company representatives that are attending here in person are entitled to speak at this meeting. And to maximize the opportunity for all shareholders, I request that you ask only one question at a time.

For our shareholders viewing the meeting via our webcast, I remind you that you can ask a question by clicking on the blue hand icon at the top right-hand corner of the webcast window.

I will answer questions in the following order. First, from those attending the meeting in person; and second, those asking questions via the webcast.

So let's start here with the room. Are there any general questions in the room?

Mr. Chairman, we have a question from Mr. Don Adams. He's a proxy holder representing the Australian Shareholders' Association.

Thank you. Yes. Well, you've heard my name. I've got proxies from 180 retail shareholders today. Mr. Chairman, I wanted to ask you a question. Before we met you, we researched your background and saw that you have a very impressive record as a company chairman, and it's no wonder that you're in high demand as a company chairman.

Nevertheless, last week at the TWE Annual General Meeting, there was a 14-odd percent voted vote against your reelection to the Board. Do you think this was just a tick a box exercise? Or do you think there's a substantive issue involved there?

Well, thank you. I anticipate you might ask me that. Look, last year, I said that I would reduce my workload. And while I have finished 2 commitments during the year, being those of my time at Toll and also the National Maritime Museum, for a number of reasons, some public and some private, I did not reduce as far as I had intended. I intend to continue to further reduce my workload during this coming year. But in the interim, I'm very comfortable that I can fully discharge my responsibility as Chairman of Brambles. And this is a Brambles meeting, not a TWE meeting, but the comments I made at TWE were that there are really 2 issues. My workload and that of other directors is a very valid subject for discussion with all stakeholders.

The point at the time was my election as a Director and Chairman of TWE, where the industry is going through a very difficult time. We have just had some challenging economic conditions in China and elsewhere. Our CEO had retired, and the new CEO doesn't start for another month -- at the time, another month. And then it was suggested that it would be in shareholders' interest that the Chairman left as well. I just found that rather strange to understand and a very different issue from whether one should have 1 Board, 5 Boards or the rest.

I have another question, but...

Yes, fire away, fire away.

The other question is concerns another unrelated company, namely Woolworths. I understand that Brambles is a large provider of pallets to Woolworths. The Wilderness Society has accused Woolworths of using dodgy certification to harvest native timbers to make pallets. Can you refute that allegation as far as Brambles is concerned?

Well, I don't think it's for me to speak on behalf of Woolworths. I don't know exactly what they do or don't do. What I do know is that 100% of our lumber is fully certified. And that includes the lumber that is provided to -- in pallets provided to Woolworths. And we have 2 -- there are 2 -- I think there was a mention I read there. There are 2 certification authorities, which I think PEFC and FSC. And some people feel that one is less reputable perhaps than the other. We use both societies. They -- and we need to do that because we have operations all around the world, and they're not both present in all regions. So approximately across our worldwide operations, we're around 50-50 certification from both of those 2 organizations. But I can absolutely assure you, sir, that our number is 100% certified. Please?

We have our next question from [ William Prince ].

Thank you, Mr. Chairman. I just want to say congratulations on doing such a fine job. And I love Brambles because it's a simple product and even I can understand it. Like a lot of other things, you can't understand. And in relation to that first question, with your workload, I have come to the conclusion you're not a mere mortal like the rest of us, that you're able to do all these different things. I was just wondering if you could -- can I ask 2 questions or...

Yes.

He did. The first is on the buyback. Just what's your criteria for the buyback? Is it at a certain price or a certain level or whatever? And is that going to continue? And I guess with the buyback, what you're sort of saying, well, this is surface to add our needs. And so we don't really have any other, let's say, capital management initiatives that we might be looking at, adding on acquisitions, that sort of thing. So that's the first question.

Can I answer that first? So I can...

Yes, you can reply.

I'll forget what you said. So yes, look, you're right on the money there. So the criteria for a buyback -- at first, obviously, that you have the cash available. You're not stretching the balance sheet. You're not preventing the company from making other investments and doing things that it should be doing to sustain ongoing performance. So if you are in that fortunate situation, then you've got a number of options, and like increasing dividends or doing other things, but we think that a share buyback, provided you're buying shares at a value that's accretive to what we believe is the long-term value of the company, then it makes very good sense for shareholders that we buy back shares.

And so we will continue with that policy. I mean, occasionally, in the event of -- like if you have a major sale of a business part or something, you might use a special dividend or something like that. But I think on the regular course of business like we are today, the buyback is the best solution.

Just a follow-up on that then. Sorry.

Can you stand a little close?

A little closer. Sorry. Just a follow-up on that. Does that mean that at this stage, you have no, let's say, acquisitions you're looking at or other growth? Like at the moment, we're a fairly focused company in one area. Is there plans to diversify Brambles? Or where is the growth coming from? Is it just basically well, we're going to continue on pallets to do that well, and we're going to have that natural growth there.

Yes. Again, I think you're quite right there. So if you don't see long-term value in your core business, then you perhaps would look at acquisitions, et cetera. We still see a huge amount of value in our core business. particularly as we move into this digital age of the digitalization of our pallets, we think there's a lot of growth from our core business. So we will continue to focus mainly on that. That said, we're always looking at opportunities. And if the right one comes along, it makes sense for shareholders, we would consider it. But that's not the case at the moment.

Just a question on the digitalization of your pallets. Can you just give an idea of the life cycle of a pallet? There's someone that got a hammer and nail and he builds a bit of a wooden pallet, and then at the end of its life, it probably ends up in New York in a 44-gallon drum fire, keeping people warm there in winter. And how is the digitalization working out? Are you able to track -- better track your pallets? Have we had significant -- because a lot of the times, the pallets went missing and many a time, I had a barbecue with a good Brambles pallet, a chef pallet or something like that. And...

I'll let people run at your place next week.

No, you're always welcome. But that was always like a standing joke that -- and also I guess most are made out of wood. Has there been any thought of different types of materials used? Or maybe there are already, and what sort of R&D do you do in that respect?

Yes. No, really good questions. So I mean, theoretically, a pallet will last forever if you keep replacing the boards on it and ultimately, down the track, it's basically a new pellet. But we depreciate them working over 10 years, I think, yes. And they -- after each cycle, it's been out in the field, they come back into our repair and maintenance centers where broken boards are replaced, locks are changed, et cetera. So they're actually very durable and last a long time.

How many go missing that? Like how many pallets have you got at the moment? Do you know that? How many pallets you have? And do you know where they are? And has the digitalization program helped you sort of say, well, Woolworths has got so many of them and Coles has got so many and somebody else has got so many. So do you have that level of specificity on that?

So that's the holy grail and it's been talked about in this industry for decades. And it's very easy to put some form of a tracker on a pallet, but to do so cost effectively has been the challenge. Pallet costs, say, $20 and you can buy a GPS tracker for $80. But if you put $80 on every $20 pallet and continue to charge $20, I wouldn't be standing here in front of you for very long. So that's been the dynamic. But we've made huge progress in the last few years.

The team have been really working over time on different technologies. So what I referred to in my speech in serialization+ is where there is, in our case, a QR code, so an individual identifier on every single pallet in the pool. And we've done that now in the whole pool in Chile. So we now know every pallet where it goes, who it goes to, when it comes back.

Is that a $80 digitization thing? Or is it a...

No. So it's a combination. So that is just an identifier, which is basically a QR code stuck on the side of the wood. But we also put -- we do put the $80 trackers in periodically, if we see that there's an issue arising in a certain part of the supply chain or a certain customer. We can put some $80 tracker pellets in that will actually tell us real time, like following an Uber blip on your phone or exactly where that pallet goes. It's obviously expensive, but it returns a huge benefit because you now know and you can sit down with the client and say, I can tell you why you're losing so many pallets, this is where they're going.

I'm very impressed with your level of detail, Mr. Chair.

Yes, no problem.

And just what was the last question. Congratulations to Graham on his child. Well, I'm trying to think of the other thing, but I'll leave it. I can't remember it so...

Come back if you do. Good. Any more questions in the room? No, it looks like no. Carina, are there any questions on the webcast?

No, there are no questions.

Wow. Okay. So we will now then turn to the items of business. Items 2 to 10 on the agenda will be proposed as ordinary resolutions. As stated in the notice of meeting, I will be casting any discretionary proxy votes that have been given to me in favor of each of the items of business. The proxy and direct vote position for each resolution will be shown on the screen. I remind you that if you're attending here today, please cast your vote by marking your green voting card. We will announce the poll results to the ASX later today and also post them on our website.

Steve Hodkin of Boardroom has been appointed returning officer.

The first item of business is to consider and receive the financial report, directors' report and auditor's report for Brambles and for the group for the year ended 30th of June 2025.

There's no vote on this item. Are there any questions for item 1 from the floor?

Can I just ask the other question?

Absolutely. No problem.

I was just going to ask you -- and I mean, I'm sure there's been no corporate approaches to the company. Otherwise, you'll tell us about that. But can you just sort of comment on that, who would be interested in Brambles? It seems to be a very specific type of business. And would a Microsoft or something like that, they have their pallets everywhere. Is Brambles an attractive business to some corporations or none?

Well, we think it's an attractive business. No, yes, look, it is because I liken Brambles to being the sort of biggest company that no one's ever heard of. So you guys as shareholders probably have, but the average person in the street has never -- has unlikely -- they may have heard of the word CHEP, but they probably haven't heard of Brambles, and yet it's a very large, successful global success story for Australia.

So yes, we are obviously attractive. I think that's why we've got a large institutional set of investors in our stock and why the share price has risen as strongly as it has over recent times. And I think we're seeing there's probably a mix between the defensive stock and a growth stock. And we sort of depending on cycles and times, that the orientation moves a bit more one way or the other. But our basic business is in FMCG dependable commodities that people eat and drink, which obviously go up and down with economic growth, but people don't stop eating.

And so it's a secure investment, and it's an investment that's been returning through thick and thin, a very good return to shareholders. And increasingly, I think we're seeing there's a little bit of growth stock. And I'm really, really excited about this digitization story. I'd probably want my colleagues not talking about it. But if we get this right, I think the growth potential for Brambles out into the next decade is second to none.

So no more questions out there? Carina, anything from the webcast?

No, nothing from the webcast.

No. Okay. Item 2 asks shareholders to adopt the remuneration report for Brambles and the group for the year ended 30th of June 2025. Are there any questions for item 2 from the floor? I take that as not. So Carina, any questions from the webcast?

No, nothing from the webcast.

Fine. The resolution and the direct vote and proxy positions are now on the screen. Please now cast your vote for item 2.

[Voting]

Item 3 asks that Vik Bansal be elected to the Board of Brambles. Vik's biographical details are set out in both the notice of meeting and the annual report. And I now invite Vik to speak briefly on his election.

Thank you, John. Fellow directors and valued shareholders. It's a privilege to stand before you today -- or sitting before you today, seeking your support for the election to the Brambles Board. Having served as a director over the last 6 months, I've developed a deep appreciation for the strength of this company, its purpose, its people and its culture.

Over the past 3 decades, my career has spanned the industrial manufacturing, distribution and logistics sectors, leading large and complex organization through the periods of transformation and growth. I've had the opportunity to serve as the Chief Executive Officer of Boral, Cleanaway Waste Management and InfraBuild and a Chief Operating Officer of New York's NYSE-listed Valmont based out of Omaha. I've lived and worked in U.S., Asia and Australia. I'm also a current nonexecutive director at Washington Soul Patts and Orica. I'm a Chair of LGI Limited.

These experiences have shaped my commitment to industrial excellence, sustainability, value focus and good governance, all of which I see as central to Brambles' long-term success. Brambles' circular business model, as John just mentioned, is one of the most compelling in the industrial world. It demonstrates that sustainability and commercial performance are not opposing forces, but in fact, complementary strengths.

As a Board member, I'm focused on contributing to continue to build on this foundation, scaling our sustainability leadership while maintaining the operational rigor that drives shareholder value. In my Board and executive experience, I've seen how transparency, accountability and clarity of purpose enable organizations to navigate complexity and build trust with all stakeholders. I am committed to upholding those standards at Brambles.

Finally, I believe digitization will define the next phase of our growth, leveraging data and technology to optimize supply chains, enhance customer value and improve asset efficiency will be key to keeping Brambles at the forefront of our industry. If elected, I will continue to bring an industrial operators mindset, global outlook, sustainability and governance to the Board, ensuring Brambles remains a global leader and continues to deliver value for shareholders, customers and communities alike. Thank you for your trust, and I look forward to the opportunity to contribute to this exceptional company's ongoing success.

Thank you, Vik. Are there any questions for item 3 from the floor? I take that as no. Carina, any questions from the webcast?

No questions.

The resolution and direct vote and proxy position are now on the screen. So please now also cast your vote for item 3.

[Voting]

Item 4 asks that Ms. Maxine Nicole Brenner be elected to the Board of Brambles. Maxine's biographical details are set out in both the notice of meeting and the annual report. And I'll now invite Maxine to speak briefly on her election.

Good afternoon, again. It's a great privilege to have the opportunity to put myself forward for election to the Brambles Board. Brambles is one of Australia's leading global companies, a business that fuels the world's supply chains while leading the way in the circular economy. Brambles moves millions of pallets and containers every day and does so in a way which reduces waste, improves efficiency and helps customers meet their own sustainability goals. This combination of scale, purpose and innovation is what really drew me to Brambles and what continues to inspire me today.

My executive career included acting as Managing Director of Investment Banking at Investec Bank, working as a lawyer at Herbert Smith Freehills and various other governance roles. These roles taught me how strategy, capital and governance intersect to create long-term value and sustainable outcomes and are key to many of the Board discussions we share at Brambles. Over the past decade, I've also had the privilege of serving on some of the largest Australian companies, including Origin Energy, Woolworths, Qantas, Telstra and Orica.

Companies like Brambles that operate globally or at scale face rapid change and must deliver both on performance and purpose. Through that experience, I hope to contribute to our ongoing focus around disciplined growth, innovation and sustainable outcomes. In my role as Chair of the Brambles Rem Committee, I'm particularly focused on culture, performance and leadership. Brambles has a strong values-based culture. And the alignment between purpose, performance and reward is an area we will continue to test going forward.

Brambles stands on firm foundations, operationally strong, strategically ambitious and grounded in purpose. I have been very impressed with the strength and values of the management team led by Graham Chipchase. With your support, I look forward to working with management and my Board colleagues to help Brambles remain the global leader it is today. Thank you for your support.

Thank you, Maxine. Are there any questions for item 4 from the floor? It looks like there are not. Carina, are there any questions on the webcast?

No questions.

Thank you. So the resolution and direct vote and proxy position are now on the screen. Please also now cast your vote for item 4.

[Voting]

Item 5 asks that Anthony John Palmer be elected to the Board of Brambles. Tony's biographical details are set out in both the notice of meeting and the annual report. And as Tony is unable to join us here today in person, he has prerecorded an address on his election.

As an Australian-born son of a sheep shearer, who spent most of my career outside Australia, I really have difficulty expressing in words just how excited I am to serve on the Board of Brambles, which I regard and always have as an iconic Australian-listed company. I started my business career in operations, consulting and strategy consulting at [ Alikay ] Partnership and PA Consulting, respectively. Over the course of my career, I've had the good fortune as an executive to serve in the chocolate wars as a brand leader at M&M Mars and more recently as a Board member at Hershey.

I served in the juice wars as the General Manager of Kids Beverages at the Minute Maid division of the Coca-Cola Company in the U.S. I served in the cola wars as Managing Director, Australasia for Coca-Cola Company; and the cereal wars as Managing Director of Kellogg U.K. and Ireland; and most recently, in the diaper wars as the very first global CMO and then Global President of Brands and Innovation at Kimberly-Clark in the U.S.

I had the very good fortune to found a digitally driven re-friendly high-performance sunscreen business, which gave me hands-on digital and entrepreneurial experience.

Over the past 3.5 years, I've served as a senior adviser to One Rock Capital, a mid-market private equity firm with offices in New York, London and Los Angeles; and my focus at One Rock is on diligence and value creation in the food and CPG industries.

Over my career, I've lived and worked or studied in Japan, in Hong Kong, in the U.S., the U.K., France, Switzerland and of course, Australia.

With regard to governance, for 14 years, I was an Independent Director of the Hershey Company, which is a Fortune 500 sweet and salty snacks company. I served as the Chair of the Compensation and Executive Organization Committee. I spent 5 years as Lead Independent Director and Chair of the Executive Committee. And at various times, served on the Finance and Risk, the Governance and the Audit committees.

The course of my career has given me an in-depth perspective of government and value creation in CPG across the globe, and it's included strategy, capital management, M&A, general management, marketing and innovation, human capital management and supply chain.

I want to leave you with the thought that if elected, I would be honored and privileged to apply this experience to the singular focus of helping make the Brambles team spectacularly successful. And as a result, the Brambles investors, you, extremely happy and satisfied.

Thank you for your time, and I hope to be working with you in the future.

Great. Thank you, Tony. Are there any questions for item 5 from the floor? Looks, again, not the case. Carina, any from the webcast?

No questions.

Wow. Breezing through it. The resolution and direct vote and proxy position are now on the screen. Please now cast your vote as well for item 5.

[Voting]

Item 6 asks that Ms. Kendra Fowler Banks be elected -- reelected, sorry, to the Board of Brambles. Kendra's biographical details are set out in both the notice of meeting and the annual report. And I now invite Kendra to speak briefly on her reelection.

Thank you, John, and good afternoon, Brambles shareholders. I'm very pleased to be with you today to have served on the Board for the last 3 years and to be standing for reelection to your Board.

I'm currently the Chief Financial Officer of SEEK Limited, an ASX 100 company, which operates market-leading digital employment marketplaces in Australia, New Zealand and across Southeast Asia. I have spent nearly 10 years at SEEK as a digital executive, first as Marketing Director and then as the Managing Director for Australia and New Zealand, prior to my appointment as CFO in 2024.

Before SEEK, I spent 11 years working in the retail sector at both Coles here in Australia and at Tesco in the U.K. across various senior commercial and marketing roles, including in digital marketing and pricing. I started my career in strategy consulting with McKinsey & Company.

Over the last 3 years, it has been a privilege to serve on the Brambles Board and to support the ongoing transformation of the business. The trajectory of the business on financial, customer, people, sustainability and shareholder metrics has been extremely positive, and there still remains so much opportunity. If reelected, I look forward to being part of the next phase of Brambles transformation, bringing further value to our customers, communities and shareholders. I will continue to bring my skills, experience and insights in retail and digital markets in realizing these opportunities on behalf of all of you, Brambles shareholders. Thank you.

Thank you, Kendra. Are there any questions for item 6 from the floor?

Sorry, I just want to clarify something. You've got a full-time job at the moment?

Perhaps I can answer that. Has Kendra got a full-time job at the moment? That very highly as a Chair to have serving executives on your Board is invaluable. You get out of date very quickly when you retire from a full-time executive position. Although you may have many years of wisdom and experience, hopefully, you can lose to...

Most of your Board have retired from their full-time job, haven't they?

Sorry?

Most of your Board have retired from their full-time jobs?

Yes, yes. But I think it's really important you have a balance. And I know sometimes guidelines in Australia are that you shouldn't have a full-time serving executive on your Board. I disagree with that. I think it brings huge value.

Okay.

Thanks. Okay. Carina, any questions from the webcast?

No questions.

No, very good. The resolution and direct vote and proxy position are now on the screen. So please again, cast your vote for item 6.

[Voting]

Item 7 asks that Mr. James Richard Miller be reelected to the Board of Brambles. Jim's biographical details are set out in both the notice of meeting and the annual report. And I now invite Jim to briefly speak on his reelection.

Thank you, John, and good afternoon, everyone. I'm delighted and honored to stand for election as a Director of Brambles. In addition to Brambles, I am on the Board of Directors of The RealReal, a U.S.-based e-commerce company. Additionally, I serve on the Board of Directors of LivePerson, a U.S.-based customer care software company; and serve on the Board of Directors of ServiceExpress, a private equity-owned company that provides third-party maintenance services to large data centers. I'm also a senior adviser to the Boston Consulting Group, where I provide consulting services related to digital transformation and artificial intelligence. Previously, I was the Chief Technology Officer for Wayfair, a large U.S.-based e-commerce company where I also served on the Board of Directors.

Prior to my roles at Wayfair, I was responsible for the worldwide operations at Google where I had responsibility for procuring, building, deploying and operating Google's worldwide compute capacity and cloud infrastructure. Additionally, I was the Managing Director of Google Energy LLC and had responsibility for sustainability and corporate and social responsibility at Google and its parent company, Alphabet. Additionally, I held executive roles at Cisco, Amazon.com, Intel and IBM in the areas of technology, operations, supply chain management and general management.

If reelected, I look forward to putting my global experience in the areas of strategy, sustainability, supply chain management and operations, information technology, artificial intelligence and data science to support Brambles in the next phase of our digital transformation. Thank you.

Thank you, Jim. Any questions for item 7 from the floor? Please, we have one here.

Mr. Chair, we have a question from a shareholder, Mark McCoy.

I'm very happy to support you and have already voted for your reelection. But I just wanted to clarify, you mentioned, if I understood correctly that you're on the Board of an e-commerce company. I'd just like to clarify whether that e-commerce company is a customer of Brambles?

The e-commerce company is The RealReal, and we are not a customer of Brambles.

Is that okay? Yes. Great. Thank you for the question. Carina, any questions from the webcast?

No questions.

No questions. Thank you. I have to say before we go to the next point, I feel very privileged to have a Board of the highest possible quality and to work with these teams. I think they're doing a good job on your behalf.

So the resolution, direct vote and proxy position again on the screen. Please cast your vote for item 7.

[Voting]

Item 8 asks shareholders to approve that the Brambles Limited MyShare Plan, as amended in the manner described in the explanatory notices accompanying the notice of meeting, the amended MyShare plan and the issue of shares under the amended MyShare Plan be approved for all purposes, including for the purposes of Australian Securities Exchange Listing Rule 7.2, Exception 13.

Are there any questions for item 8 from the floor? I take that as a no. Thank you, Carina. Any questions on the webcast?

No questions.

The resolution and direct vote and proxy position are now on the screen, and please, therefore, again, cast your vote for item 8.

[Voting]

Item 9 asks shareholders to approve the participation by Mr. Graham Chipchase until the 2026 Annual General Meeting in the Brambles Limited Performance Share Plan in the manner set out in explanatory notes accompanying the notice of meeting, and that be approved for all purposes, including for the purposes of Australian Securities Exchange Listing Rule 10.14. Are there any questions from item 9 on the floor? It looks like no as well. Carina, anything from the webcast?

Nothing from the webcast.

Thank you. The resolution and direct vote and proxy position are now on the screen. Please now cast your vote for item 9.

[Voting]

Item 10 asks shareholders to approve the participation by Mr. Graham Chipchase until the 23rd of October 2028 in the: a, Brambles Limited MyShare Plan, if approval to the amendment to the MyShare Plan under Resolution 8 is not obtained, which is not the case; and b, the amended MyShare plan, again, if the approval is obtained in the manner set out in the explanatory notes accompanying the notice of meeting be approved for all purposes, including for the purposes of Australian Securities Exchange Listing Rule 10.14.

Are there any questions for item 10 from the floor? It looks like there are not. Carina, any questions from the webcast?

No questions.

Let me go. The resolution and direct vote and proxy position are now on the screen. So please again, now cast your vote for item 10.

[Voting]

Are there any further questions from the floor? It would seem not. Carina, anything from the webcast?

We have a question from the webcast. From shareholder, Michael Cobin. The Chairman is very supportive of the digitization of Brambles. Perhaps he could share with us what is digitization as far as Brambles is concerned and the reason why it is so good for the company?

I'll have a go. Yes, certainly. Thank you for the question. So I think, to an earlier question, this holy grail of pallet industry has been to be able to digitally identify every pallet in the system. And that's been the goal for many years. We've now finally started to do that. And what does that mean? And what does that -- what benefit does that give? Well, we'll break probably into 3 layers.

Firstly, by actually knowing rather than having to guess or estimate as best you can how many pallets you have in a certain pool, you obviously start to get much better control of your business. I mean, as an example, in Chile, when we serialized all of the pallets, we finally actually had more pallets in the system than we thought we had because we were trying to make conservative estimations, all the time of losses and those sort of things. And with serialization+, we can actually now count how many we have. So that's the first benefit, operational at our level.

Second benefit is for the customer. Using Brambles over the years has been a very manual and generating a lot of work for customers. You have to physically count all the pallets and then they enter them into Excel spreadsheets. And then we come along 6 months later and now they can't find some of them. As a gentleman here said, some of them end up in the local garden center, et cetera. So for the management of the pallet pool for the customer is quite tedious, time consuming, labor intensive. By moving to a fully digital interaction, it takes all of that away from them, which is a huge positive for the customer.

And then the last layer is what we're calling digital customer solutions, and that's where we are actually associating a particular load with a numbered pallet, and we're following that pallet through the supply chain. We -- the whole Board, we were in New Zealand a couple of days ago, observing a movement of strawberries from the paddock all the way through to Woolworths DC and ultimately to the shelf. And with a digitally enabled pallet, we can tell both the grower as well as Woolworths and any other retailer exactly what's happened to those strawberries from start to finish, how long it took to get to the DC? Was it in temperature all the time? What was the humidity? All of those sort of details. So that then gives the retailer a much better control, quality control over the product that they receive. And we can now -- we can charge for that service because it's a real value add to the customer.

So those 3 levels of digitization, when you add them together, that's why I'm excited about the future. I hope that answers your question. Any others?

No further questions.

Ladies and gentlemen, that concludes our discussion on the items of business. Now please remember to place your voting cards in the boxes beside the exits. The poll will remain open for another 10 minutes. When the poll closes, you will be notified on the screen behind me. And we will announce the results of the poll to the ASX later today.

Ladies and gentlemen, thank you very much for your attendance today. I'm really grateful. And I remind you that copies of the sustainability review are available in the foyer. And I now declare the AGM closed, and I invite you to join us outside for tea and coffee. Thank you.