Genesis Energy Stock

Thank you for standing by, and welcome to Genesis Energy Full Year Results for the 2026 Analyst Briefing. [Operator Instructions]

I would now like to hand the conference over to Mr. Malcolm Johns, Chief Executive Officer. Please go ahead.

Welcome, everybody, and thank you for your time. It is a pleasure to be here today to talk you through our FY '26 results. My name is Malcolm Johns, Chief Executive of Genesis, and I'm pleased to be joined today by Emma Oettli, our CFO; and Michael Hunter, our GM, Investor Relations. I'd also like to introduce you to the wider executive team doing an awesome job.

Claire Walker, our Chief People Officer, has worked hard to strengthen our leadership bench through a combination of building and buying talent, setting up strong internal succession lines. Stephen England-Hall, our Chief Revenue Officer, leads our trading portfolio and customer teams, driving commercial performance and customer value to a strong result in this past year. He also led the final stages of our move to a single repositioned Genesis brand, which went live in August. Matthew Osborne is our Chief Corporate Affairs Officer, a busy year with a number of regulatory and policy matters in play. Ed Hyde, our Chief Technology and Transformation Officer, delivering our 3 major platform upgrades on time and within budget. Tracey Hickman, our Chief Operating Officer, excellent execution of existing asset upgrades and delivery of our pipeline of new renewable generation. Every part of our business is delivering our strategy well, and you will see the proof points as we talk through our FY '26 results and then look out to FY '28 and FY '32.

On the screen now is today's agenda. We will spend about 20 minutes talking through FY '26 before touching on our outlook to '28 and '32 and then moving to your questions. Our strategy remains Gen35, and we are delivering Horizon 2, the period out to FY '32 or what we call the FY '32 growth plan. At Genesis, we believe electricity is the solution to New Zealand's energy challenge. It's efficient, it's increasingly renewable. And because it's made in New Zealand, it provides greater energy security and independence. However, today it only makes up around 30% of New Zealand's total annual energy. 70% comes from fossil fuels. And as we have seen since the Iran conflict began, this can have a material impact on the total energy costs for Kiwi homes and businesses.

If electricity made up 60% of New Zealand's total annual energy today, the average household would save up to $3,000 per annum on their total energy costs or New Zealand's total annual energy bill would be around $10 billion a year less than it is today. This is why our vision is a country that lives life at full power, homes, businesses and the country leveraging our natural renewable electricity advantage to thrive at full power for this generation and the generations that come after us. Achieving this is about the electrification of transport and heat. This will not only lower the total cost of energy for our customers, it will also grow demand for our products and services.

As a sector, we must deliver the 60, 95, 100 formula. 60% electrification of New Zealand's total energy, at least 95% renewable generation and electricity that is available 100% of the time regardless of the weather or customer demand outcomes. For Genesis, Gen35 is about growing customer demand for electricity through electrification, reducing average generation costs from increased renewable generation investment and energy security and flexibility from Huntly Power Station. For our investors, we are focused on embedding 3 commercial foundations in our culture: margin quality, cost discipline and strong capital management. Gen35 life at full power delivers for our customers, our investors and for our country.

Can I now hand to Emma to talk you through FY '26. Emma?

Thanks, Malcolm, and cure, everyone. FY '26 provides a number of important proof points that Gen35 is translating into financial outcomes. At the heart of our strategy, we are focused on 3 commercial disciplines: margin quality, cost discipline and strong capital management. On margin quality, group gross margin increased to $949 million, our strongest result to date, reflecting improved customer netback and lower generation cost.

On cost discipline, cost to serve reduced as planned and investment within our Big Rock program remains within the overall $145 million program envelope. And on capital management, the March equity raise materially strengthened our balance sheet and provides funding capacity to fund the next stage of our growth program while retaining investment-grade credit metrics. Together, these highlights demonstrate tangible progress in executing Gen35.

I'll now take you through our FY '26 business performance and the progress we've made across customer, renewables, Huntly and our Big Rocks technology program. In customer, our strategy over the past 18 months has deliberately prioritized value over volume to support margin quality and cost discipline. We have repositioned the portfolio while simplifying our brands, products and operating model. This did result in lower customer numbers during FY '26, but the economic outcome was strong. Electricity netback increased to around $176 per megawatt hour, cost to acquire reduced materially and cost to serve also declined.

At the same time, we continue to build higher value relationships around electrification. EV plan connections increased, rooftop solar connections grew and flexible customer demand reached 58 megawatts. The final stage of our move to a single brand strategy was completed in the fourth quarter. And since June, ICPs have returned to growth. The important point is we are targeting profitable customer growth that supports both margin quality and cost discipline.

Alongside customer, we are investing to structurally lower the cost of our generation portfolio. Our FY '32 growth plan targets more than 2 terawatt hours of additional renewable generation, allowing us to progressively displace higher cost baseload thermal generation. During FY '26, Tihori solar farm moved into construction. And today, we are pleased to announce the final investment decision for the Leeston solar farm in Canterbury. Lauriston completed its first full year of operation, and we have also secured additional geothermal supply from Ngawha from 2029, further strengthening and diversifying our renewable supply. And we continue to progress a broader pipeline across wind and solar. Investment decisions remain subject to our capital management framework. They need to improve portfolio economics and meet our target returns.

As our renewable portfolio grows, Huntly continues to evolve alongside it. We're positioning Huntly for the future needs of Genesis, transitioning away from baseload gas generation by around FY '29 or earlier, adding Huntly firming options, increasing our asset-backed trading activity and firming Genesis customer needs. Based on current market conditions and assuming no major outages or significant regulatory change, we are confident that Huntly, together with our hydro assets can provide all the flexibility, firming and peaking capacity Genesis will need to grow securely for the foreseeable future.

We see Huntly centered around our new batteries, 3 upgraded ranking units and our fast-start peaker. We retained the option for a second fast-start peaker, although there is no commercial case for that investment today. Those assets will be supported by diversified fuels of coal, gas and diesel, with biomass remaining an option as economics improve into the 2030s. Should imported gas become an option, fuel pricing will determine which fuels are dispatched at what times. We continue to engage on gas storage. However, while this may be helpful, it is not fundamental to delivering our FY '32 growth plan.

We plan to continue contracting minimum levels of take-or-pay gas except where price and volume is commercially attractive. As we have done over recent years, we will continue to leverage our fuel diversity alongside the wholesale electricity market and tactical short-term gas contracts to drive margin quality. Unit 5 is a large, well-maintained generation asset. However, its size and minimum operating range of 180 megawatts makes it increasingly challenging to see a commercial case to support it once baseload gas generation is displaced. We have been clear since we launched Gen35 in FY '24 that we will only maintain assets with clear and reliable commercial business cases. Over the next 12 months, we will be undertaking a review of Unit 5's commercial future. All options will be considered, including offshore sale.

Finally, a quick update on our technology program. As we set out at our 2024 Investor Day, we're delivering 3 major technology programs; a new billing and CRM system, a new financial management system and a new electricity trading and risk management platform. These are complex programs, but we remain on track to complete them by the end of FY '27 within a total cash envelope of $145 million.

Turning now to our group financial performance. FY '26 delivered strong earnings, strong cash generation and a stronger balance sheet, reflecting the disciplined execution I've discussed. In FY '26, we delivered our strongest gross margin to date, up 10% on the prior year, reflecting improvement in margin quality in our customer book and lower generation costs. This translated into reported EBITDAF of $518 million and normalized EBITDAF of $522 million, while also funding around $56 million of operating expenditure associated with our Big Rock technology investment and single brand strategy.

Looking at the $85 million increase in gross margin, the 2 largest drivers were improved margin quality in our customer book and lower generation costs as a result of increased hydro and a full year of Tauhara and Lauriston. Market conditions provided less opportunity to add value through length. That lower contribution was partly offset by Huntly firming option premiums in the second half. On operating expenditure, normalized OpEx increased $16 million to $377 million. The increase reflects wage inflation, technology support, a full year of Ecotricity OpEx and $5 million associated with the single brand strategy. Note, there has been a $15 million reclassification of metering costs to gross margin during the year.

As the major technology and single brand programs conclude in FY '27, the focus increasingly shifts towards converting these investments into ongoing margin quality and productivity benefits. The operating result translated strongly into cash. Operating free cash flow was $322 million, which is the equivalent of a 62% cash conversion ratio. Working capital was a positive contributor, including payments from counterparties supporting the strategic coal stockpile under our Huntly firming options. Our capital program remains balanced between maintaining the resilience of existing assets and investing in growth. Same business CapEx was $119 million. This included investment in the Rankines as part of the Huntly life extension program. This multiyear program supports the continued availability of Rankines through the FY '35, consistent with the Huntly firming options.

Growth CapEx was $182 million, concentrated on solar development and BESS, which will progressively displace higher cost thermal generation and structurally lower our long-term cost of generation. Our strong cash generation, together with the $400 million equity raise has materially strengthened the balance sheet. Net debt has reduced to approximately $940 million, and our debt-to-EBITDAF ratio has reduced to 1.6x. This gives us the financial capacity to execute the FY '32 growth plan while maintaining resilience through energy market cycles. The Board has declared a final dividend of $0.0758 per share, taking the full year dividend to $0.1488 per share. The Board has set a fixed dividend policy through to FY '28. We expect to provide an update on our dividend policy beyond FY '28 at the FY '27 half year results.

Turning now to FY '27. For FY '27, we are guiding to normalized EBITDAF of $480 million to $520 million, assuming P50 hydro, wind and solar conditions. As always, guidance remains subject to hydrology, fuel availability and plant reliability. Our digital Big Rocks program will conclude in FY '27 with around $45 million of final program spend. Stay in business CapEx is expected to increase to $140 million to $150 million, reflecting the second year of the Huntly life extension program. And growth investment is expected to be up to $325 million, predominantly supporting battery and solar developments.

I'll now pass back to Malcolm to discuss the group outlook and closing remarks.

Thank you, Emma. A solid year with good proof points, our strategy delivery as we balance the needs for our customers and investors. We have balanced investment well between supporting better services and products for our customers and to set the business up for competitive returns and growth for our shareholders. FY '28 remains our target year for being clear of major technology investment.

Current wholesale electricity prices present a potential near-term opportunity and risk. However, our outlook to FY '28 continues to see credible pathways to EBITDAF in the upper $500 million range. That outlook is based on P50 generation assumptions, no major changes to regulatory or market settings and no significant unplanned outages or fuel disruptions. Importantly, it reflects the continued benefits to our customers and investors from executing our strategy to deliver improved margin quality, cost discipline and strong capital management.

If we now look beyond FY '28 and out to FY '32, this is Horizon 2 of Gen35, the period from now out to FY '32. We first shared this framework during our successful capital raise earlier in the year. The FY '32 growth plan has 5 commercial pillars to it: customer, where we are focused on growing demand through electrification of transport and heat along with new and emerging demand sources. This will also lower the total cost of energy for our customers, as I mentioned earlier. Renewables, where our focus is structurally lowering our long-term average generation cost through investing in new renewable generation. Huntly, where we are leveraging the existing and emerging growth opportunities the Huntly site offers us to firm our portfolio and increase asset-backed trading. OpEx, returning to core operating cost levels from FY '28 and delivering ongoing productivity gains and our headwinds, the cost of maintaining a future development pipeline of around 2,500 megawatts and the known and planned decline of Kupe out to around FY '34.

So to recap, we are building a culture focused on margin quality, cost discipline and strong capital management to deliver demand growth, a lower average generation cost, leveraging the opportunities from the Huntly site, deliver a competitive operating cost base and lean into our known headwinds.

Thank you for your time today. We will now move to your questions.

[Operator Instructions] Our first question is from Grant Swanepoel with Jarden.

So you've started the year really well from a hydro perspective. Your guidance is sitting midrange at $500 million. Does that mean that because it's a P50 actually, at the moment, we're tracking above mid guidance? And on that front, the gas that you're on selling, is there a bit of a loss in that through winter? And how do you mitigate that going forward? And with that in mind, is the Tariki gas storage potential still looking good, even though you are saying you haven't committed to that yet?

Thanks, Grant. Obviously, we've guided based on P50 hydro, wind and solar and hydro conditions will play a role in terms of where our final result lands as they did in FY '26. We also, of course, have the remainder of the tech project OpEx in there and the remainder of the single brand OpEx in there as well. So that's where we've come to the $480 million, $520 million is based on P50 hydro, wind and solar and with those known big project costs in there.

In terms of gas, I'm not sure I understood your question correctly. Could you just repeat it?

Well, you would normally have to use a lot more gas and you've sold that gas on through winter because you've had so much water. Is that gas being sold at a material loss to what you're paying for it?

No. In terms of our net position, no.

And Tariki? How is that developing?

And Tariki, so we'll continue to have engagement with the joint venture partners that own Tariki. They're in subsurface work at this point in time. Quite clearly, as we said, gas storage is helpful, not essential to Genesis' FY '32 position, but potentially material to the long-term viability of Unit 5.

Second question is around IT delivery. You're saying that most of that will be done by the end of FY '27. Is there quite a bit of slippage in that or is the slippage under your control?

The slippage is under our control at the moment. As we said, I think at results last year, the 3 big systems we're replacing is like a heart and lung transplant for the business. The financial management system is now in. The electricity trading and risk management system is well advanced. We're through the first phase of the billing and CRM system. The big migration will occur in the second half of this financial year. And once that's complete, then all 3 systems will be in place. But we would consider it at this point in time to be under our control, Grant.

Our next question is from Joshua Dale with Craigs Investment Partners.

Just on your FY '28 EBITDAF target for $500 million, stay on track with commissioning of Leeston and Edgecumbe solar is pretty critical to reaching that target in that specific time frame. What gives you confidence those are going to come in on time? And what is the risk of slippage?

We're working with reputable EPCs. And so on that basis and based on our experience to date, we see no reason for slippage in COD in those projects. As with all of these projects, that's based on our knowledge today. If we encounter problems, there's always a risk of that, but we don't see it as a high risk at this point in time, Josh.

Okay. That's great. Second question, just around gas. If we look at Slide 31, it shows your equity ownership in Kupe dropping to 0 in the middle of 2029. If you are off baseload gas by then, I guess, perhaps, it's less important to have. What is your thinking around keeping Kupe? And I suppose also if you are exploring an offshore sale of Unit 5, have you done any preliminary work around what price per megawatt might be achievable? I appreciate it's conditional on LNG.

Yes. So those dips that you can see, in particular, in November '25 are the planned outages for Kupe gas field, and they normally occur in November each year and they coincide with the planned outages of Unit 5. So that's why you see that. But in essence, I'm not actually 100% sure why our equity gas drops to 0 then. Let us find out the answer to that and come back to you, Josh.

In terms of your second question, which was about offshore sales, we have done some preliminary work around what the international market for units like Unit 5 is. And you can do the same thing yourself if you want to, just basically Google them and there's a number of different purveyors of these machines. And I wouldn't want to put a price on it at the moment, but the 4-year time line that -- the wait list, sorry, that's in the market at the moment means there is a demand for these machines and people are paying attractive prices for them.

Our next question is from Andrew Harvey-Green with Forsyth Barr.

First question I just have, I guess, following on from Joshua here, just on Unit 5. And I'm assuming the LNG decision is very tightly tied to what happens with Unit 5. Is that presumably a precondition to Unit 5 staying around?

As we've said since 2024, we won't maintain assets that don't have a compelling commercial case to maintain. In the case of Unit 5, you essentially need 3 things. One is you need committed demand for it. The second is you need cost competitive fuel for it. And the third is you need to be able to match the flexibility that will come into the market, in other words, gas storage. And so to build a commercial case for Unit 5 domestically, you need to tick those 3 boxes. And we're at a point now where whilst there's work going on around those 3 boxes, it's incumbent on us to start investigating other options beyond 2029.

Yes. And next question I just had was around your CapEx guidance in particular. So are you able to just give a bit more color in terms of the Huntly work that's ongoing? How much is included in the SIB CapEx number for this year? And what we can expect for this probably in the next 2 or 3 years if it's a multiyear program?

We've provided stay in business CapEx guidance this year between $145 million and $155 million. This is elevated. And if you look across the FY '32 growth plan, what we've also included in the integrated report is up to $800 million will be spent on stay in business across this time period. So that's now out there as an outlook to point to. Huntly life extension continues for the next maybe 2 to 3 years. But at the same time, we've also got midlife CapEx programs across generators and turbines out in our hydros, and that's underpinning the elevated forward view.

So in essence, if you take that $800 million, remove the Huntly life extension and the replacement of turbines and generators, you get to our long-run average of about $80 million a year of stay in business CapEx.

[Operator Instructions] Our next question is from Stephen Hudson with Macquarie Group.

Just on Kupe, can you discuss EBITDAF improvement in a little bit more detail over FY '26 and what you're sort of baking in for FY '27?

Is that from the segment note, Stephen? When you look at EBITDAF improvement?

Yes, yes.

Yes. That is probably the gas price that's transferring between the 2 business units. So there has been an increase in that price year-on-year and that's what's increased. That's what's driving it. Production is down, pricing is up.

And what you're expecting sort of into FY '27? I think it's what, 36 to 69 and then sort of a more normalized number in '27?

We don't provide guidance, I guess, at an individual segment level. But what we can say is that in the FY '28 number and the FY '32 growth plan, we have included that headwind that comes from our Kupe asset long term.

Would you still expect '27 to be sort of an elevated EBITDAF number, I guess? Or should we expect a large normalization back to the '25 kind of level, just broadly speaking, given it was such a large movement in '26?

We'd come back to on, Stephen. Sitting here, we don't have that information at hand, sorry.

Yes. No problem. And then just on HFO, can you -- I mean, there's obviously been a bit of talk about the LNG terminal and what it may mean for all sorts of dry year energy swings. I understand there's a 5-year break on the HFO. Is that correct? And if so, how does the break clause work?

We're bound by confidentiality on that. There is a review midway through the contract. That has a number of aspects to it, but we can't go into detail on that, Stephen.

Okay. All right. I'm going to sneak in a third, if you don't mind. Just in terms of normalization, it was obviously a fairly quiet year in terms of normalization this year. Can you call out any kind of expected normalization that you're expecting over FY '27?

No. Looking forward, we see normalization becoming quite a small number -- quite a small part of those numbers. So again, we'll probably revisit across the year to understand if that's helpful or not.

There are no further questions at this time. This will conclude today's conference. Thank you for your participation. You may now disconnect.

Thank you for standing by. Welcome to Genesis Energy Half Year Results 2026 Analyst Briefing. [Operator Instructions]

I would now like to hand the conference over to Mr. Malcolm Johns, Chief Executive Officer. Please go ahead.

Good morning, and thank you for joining us. Before we get into the detail, let me briefly outline how we will run today's session. I'll start by covering a quick snapshot of the half year FY '26, and our core investor value proposition before stepping through progress on our Gen35 strategy delivery. Julie will then take you through the group financial performance, FY '26 guidance and our outlook to FY '32. We will then move to the equity raise we announced to the market today before we open for questions.

Let me start by recapping the highlights of our record first half earnings performance. Our FY '26 half year normalized EBITDAF was a record $307 million. Over the past 18 months, we have stepped up leveraging our market-leading flexibility to drive earnings outcomes. Across FY '25, we leveraged our flexibility to defend earnings during periods of low hydro and low wind. For the first half of FY '26, we again leveraged our flexibility, but this time to optimize earnings during periods of high hydro and high wind. This is Genesis' competitive advantage and core investor proposition, earnings resilience no matter the weather.

Group operating cash flow for the half was $183 million, up 298% on the prior period. Net debt remains well managed and within our target range to support our BBB+ investment-grade credit rating. Over the last calendar year, we delivered total shareholder return of over 13%, and the Board has declared a half year dividend of $0.073 per share, in line with current dividend policy.

Gen35 is focused on building new renewables into our large already established customer book, displacing baseload gas generation as quickly as we can and further leveraging our market-leading flexibility to drive growth. Today, we are updating our outlook for FY '28 to upper $500 million EBITDAF and extending our outlook out to FY '32. Our FY '32 outlook is driven by growing cash from our customer, renewables and flexibility COGS in our strategy, which we will speak to further shortly. As we have previously indicated, once we have embedded our new financial management system, we will be evolving our reporting to reflect these 3 value pools. This is most likely to be the FY '27 half year results.

Margin quality uplift is a strategic deliverable. And during the half, we continued to optimize our customer book through the integration of Frank into Genesis and the full purchase of Ecotricity. Customer churn and netback uplift during this transition played out as expected. A major milestone this half was the first cohort of around 50,000 customers successfully migrating onto Gentrack's G2 platform. The transition went well, and we are quickly seeing encouraging operational and customer benefits. Release 2 is on target for delivery late this calendar year, early next calendar year.

Moving now to delivering our renewable generation. In FY '23, our development pipeline stood at around 364 megawatts. Today, it is around 2,500 megawatts and will continue to grow. We are on track to deliver our renewables growth objectives of around 500 megawatts of solar, 200 megawatts of BESS through advanced stage and consented sites with grid connections.

We completed a partnership agreement with Yinson Renewables for first mover options on PPAs and joint venture wind developments across their 1,000 megawatt wind pipeline. This is in addition to the offtake agreement we have with Yinson for 70% of the Mount Cass wind farm in Canterbury. That's scheduled to start construction in quarter 3 FY '26, with supply expected in quarter 1 FY '29. Noting that we also have our own existing wind options at Castle Hill, which we are progressing.

Defending our earnings in dry, low wind periods, and optimizing them in wet, high wind periods, is driven by our market-leading flexibility. We are delivering BESS 1, a $135 million, 100 megawatt 2-hour battery, which is on track and tracking within budget. BESS 2 business case is progressing on track. Adding solar and BESS developments will drive margin uplift across our 3 hydro schemes, which can store around 500 gigawatt hours in total.

Turning now to the delivery of our major technology upgrades. We remain within our target total cost envelope of $145 million. Phasing is currently as indicated, however, there may be some movement between FY '26 and '27 for spend that is currently scheduled around the middle of the calendar year. In addition to being live on Stage 1 of G2, we are also now live on our new financial management system, and we are well into delivering our electronic trading and risk management system upgrades. I would now like to hand over to Julie to run through group performance. Julie?

Kia ora Malcolm, and morena to everyone on the line. As Malcolm outlined earlier, we have delivered a record half-year earnings, with our Gen35 initiatives continuing to deliver well, and the business making good progress as we move through Horizon 2 of Gen35.

Our value proposition that we shared at our Investor Day in November remains strong. And in support of that, you will all now be aware of our most recent capital management strategy activation, being the equity raise offer that we put into the market today. This is an opportunity for our shareholders to invest with us in the acceleration of our growth pipeline of dispatchable firming capacity and new renewable generation, displacing gas from our baseload generation while sustaining our well-established customer position. We will talk more to this offer shortly, but first let me take you through our half-year results for financial year '26, our guidance for the remainder of the financial year, and our outlook to financial year '32.

As you will see on Slide 12 of the results presentation, Genesis delivered a reported EBITDAF of $303 million and a reported net profit of $95 million, both significantly up on the prior comparable period. This strong financial outcome was delivered through a period of significant supply across the sector due to the extreme weather conditions, driving lower wholesale prices and reducing the need for thermal generation as we bought off the market to meet our customer demand.

Our revenue was down 13% overall, largely reflecting lower wholesale prices and reduced generation, while noting that the tactical activity undertaken to rebalance our customer demand mix has delivered higher quality retail margins.

Before I speak in more detail about our group gross margin and operating costs, I do want to call out that the half-year results now reflect the accounting for the new long-term Huntly firming options. Our Rankine units are now valued as capacity assets, and we have also brought in a new derivative position for the long-term HFO calls that we expect from our counterparties, along with their associated coal and carbon obligations.

So moving on to Slide 13, our group gross margin was up 27% on the prior period, with a notable uplift from our generation mix and overall lower cost of fuel, coupled with an 8% increase in retail margin contribution. Our hydro generation increased by 17% against PCP as we responded to the weather conditions, which gave rise to an uplift in gross margin from displacing thermal generation. This was supplemented by around 250 gigawatt hours of higher generation from our renewable energy PPAs.

The dry winter conditions and gas scarcity that featured in the prior comparable period saw a gas price rebalance in the current half, with the average cost of gas reducing by around $3 a GJ. This upside was partially offset by an increase in the cost of coal and carbon.

Another call out is our higher wholesale gas margin, which was enabled in part by tactically extending the shutdown of Unit 5 in a lower price environment and redirecting the gas to industrials in Q2.

The strong contribution from retail reflects our continued focus on margin improvements. Also noting that this result includes a full half-year of Ecotricity gross margin of around $10 million. And also of note during the half is that we saw a 15% increase in lines and distribution fees against PCP, with these costs being passed through to our customers.

Moving across to operating cost, we had a 7% increase in spend against PCP excluding digital projects. We have taken out around $5 million of costs from multiple initiatives, including our retail operating model reset and changing our insurance structure. However, we also have around $2 million of higher costs across the period as we continue to activate our productivity initiatives with temporary resourcing, and we work through realizing the synergies from our one brand strategy.

As Malcolm mentioned, our major digital transformation projects are tracking well, with financial year '26 being a peak year for this spend. During the half, we incurred around $14 million for our retail billing system and spent around $10 million on our finance system replacement, which went live on the 2nd of February. We continue to prioritize our maintenance projects, with a slight ramp-up in spend during the half in support of our Rankine units' activity to ensure they are stand-by ready for calls under the new LT long-term HFOs.

Moving to capital management on Slide 14, we generated $183 million of operations free cash flow after stay-in-business CapEx. This cash was utilized to fund our dividend commitments and progress our growth investment pipeline in alignment with our capital allocation framework that I shared with you at Investor Day '25.

We successfully released around $95 million of cash from our working capital, with the establishment of the new coal energy reserve stockpile that is funded by our HFO counterparties. We are now working towards reducing our operational coal stockpile further as our growth investment opportunities advance.

Our stay-in-business CapEx spend of $43 million for the half remains in line with our expectation for financial year '26 of $130 million to $140 million. This spend is elevated in the latter part of the financial year as we ramp-up activity, including overhaul and upgrade works for our hydro assets, and activity in support of prolonging the life of the Huntly scheme.

Our growth investment spend of $70 million was directed to advancing our Huntly BESS construction, which is progressing well, and our solar pipeline, including the acquisition of the rights for Rangiriri solar farm.

Moving to Slide 15. We continue to remain focused on our balance sheet and the strengthening of our capital management framework as a key enabler for Gen35. The activation of our capital management strategy is well underway, and we are confident that funding will not be an impediment to accelerating our growth investment pipeline and the associated returns growth.

We remain focused on financial resilience and our investment-grade credit rating, which was recently reaffirmed by Standard & Poor's at BBB+.

The Board has declared a financial year '26 interim dividend of $0.073 per share, in alignment with our dividend policy, with a record date of 26th of February 2026 and a payment date of 25th of March 2026. Our dividend reinvestment plan remains in place as a valuable tool to manage our balance sheet through the cycle, and this will continue to be operational alongside the equity raise due to the Crown's ongoing formal commitment to participate. To ensure fairness for shareholders, we have adjusted the DRP pricing mechanism as you see summarized on the slide.

Moving out to our retail business. Our focus on margin quality is reflected in the 19% increase in total retail netback across all segments. This is a key financial metric that we remain focused on, with disciplined pricing, improved customer mix and reduced cost to serve.

The reliability of our schemes and operations is another focus area to ensure our generation assets are available to us and to the market when needed, regardless of the season and the shape of the demand. This is a key enabler for unlocking flex for an optimized portfolio position.

And on -- as Slide 19 shows how our generation played out across the half, with more hydro and increased PPA volumes, and a material reduction in thermal, demonstrating how our portfolio flexes to market and weather conditions to protect our margin. And notably, we delivered a 21% reduction in the average cost of generation per megawatt hour against the PCP. As our investment pipeline matures, we will further optimize our portfolio and reduce the cost of generation.

So in summary, the financial year '26 half-year financial performance saw us deliver a strong uplift in earnings through margin quality, while maintaining cost discipline, and a critical focus on the strength of our capital management. Our retail netbacks improved across all segments, our asset reliability was high, and we demonstrated market-leading flexibility across the portfolio. We continue to deliver on what we said we would, and we are focused on uplifting our earnings out to financial year '32, enabled by our pipeline of growth opportunities and our continued focus on productivity initiatives across the group.

So moving on to the outlook for financial year '26. Our normalized EBITDAF range remains unchanged from the upgrade we issued in January, that took our guidance to $490 million to $520 million. The outlook for the second half of the financial year is premised on P50 hydro inflows and features more thermal generation as seasonal demand increases and brings generation cost pressure on gross margin. This all remains subject to hydrology, gas dynamics, plant performance and market conditions.

I want to speak now to our outlook for financial year '32, as this is a critical year for Genesis as our growth investment pipeline of opportunities are delivered and activated. As Malcolm shared earlier, we now have a growth pipeline of around $2 billion that is enabling a financial year 32 EBITDAF range of between $650 million and $750 million. This pipeline includes a range of advanced stage renewable developments that displace baseload gas generation, significantly reducing our total cost of generation as indicated on the slide, while leveraging our flexibility and customer demand position.

We also continue to progress other Gen35 initiatives that are enabling productivity gains and driving our like-for-like OpEx target of around $380 million in real terms. While noting though, that there will also be incremental OpEx coming into the business when our investments are operationalized, and they start generating the EBITDAF uplift and returns growth.

Our primary source of funding over the period to financial year '32 is our own operating free cash flow, which also includes a range of self-help measures, including working capital and inventory management. Operations free cash flow funds our stay-in-business CapEx, and includes all planned major hydro and Huntly maintenance, and it also funds our dividend policy. Any surplus cash will contribute to the funding of our growth investment pipeline, alongside the funding toolkit pathways, which now includes our equity raise offer of $400 million. Our capital management framework ensures a credible pathway to accelerate the delivery and returns from our financial year '32 growth pipeline, while maintaining our investment-grade credit rating of BBB+.

Serving our customers well and growing our total shareholder returns remain at the center of our thinking. We have delivered what we said we would over the past 2 years, and we are confident we will deliver what we say over the coming years.

I am now going to hand back to Malcolm to talk in more detail about our equity raise offer. Malcolm.

Thank you, Julie. The results we've just walked through are not the end point. They are a proof point that the platform is working and that we now have momentum. With a maturing pipeline of consented and advanced stage projects, and clear line of sight to higher earnings through to FY '32, the question becomes one of timing and capital allocation. To bring forward the highest return elements of that pipeline, while preserving our balance sheet settings and dividend framework, we have today announced a $400 million equity raise.

Our FY '32 growth pipeline is around $2 billion of growth CapEx, and focuses on lowering our average cost of generation and displacing baseload gas to deliver EBITDAF uplift of between $650 million and $750 million.

Our growth plan is derisked because Genesis has an already established large customer demand position of around 6.2 terawatt hours per annum, and market-leading flexible generation of 1,270 megawatts. Equity from this raise will be used as part of our overall funding toolkit to accelerate delivery of our growth pipeline and drive competitive shareholder returns.

The Board believes that purposefully accelerating our growth opportunities while maintaining competitive returns for shareholders is prudent at this time. That is the context for the equity raise and size we are proposing.

Today's raise is to support accelerating delivering new renewables from the pipeline. With initial focus being on completing the circa 500 megawatts of solar, 200 megawatts of BESS, and life extension of the Rankines we have previously signaled. For investors, our existing large customer book, 3 well-placed hydro schemes, and market-leading flexibility offers the opportunity to invest into an earnings growth outlook in a derisked way. That also supports New Zealand's wider energy security and transition. The Crown has agreed to support the raise by pre-committing to subscribe for shares to ensure it retains a 51% shareholding. This support is a reflection of the government's goals for secure and affordable energy in New Zealand, as well as seeing value in the commercial proposition on offer under our FY '32 growth plan.

Let me recap Genesis today and the context for an equity raise. Genesis is an integrated generator and retailer supplying electricity, gas and LPG, with a large established customer book of around 500,000 customers that is geographically spread across New Zealand and all market segments. Three well-placed and geographically spread hydro schemes that can store around 500 gigawatt hours. Market-leading flexibility of around 1,270 megawatts, growing to around 1,370 megawatts.

Competitive PPAs across solar, wind and geothermal. As we have demonstrated across FY '25 and '26, we are now leveraging our large customer book and market-leading flexibility to defend our earnings in dry and low wind periods and optimize our earnings in wet and high wind periods. Genesis offers investors earnings reliability and energy transition risk management in a growing market.

As we roll out our FY '32 outlook and growth pipeline, we will deliver growing cash from the 3 COGS in our portfolio of customers, renewables and flexible generation. We are converting that growing margin into operating free cash flow uplift by building cultural foundations around continuous improvement in margin quality, cost discipline, and strong capital management. We have delivered over the past 2 years, and we are confident we can deliver our growth plan.

We are in a growth market. By 2050, electricity must be 60% of New Zealand's total energy. That is 30% today. At least 95% of that electricity needs to come from renewable sources. That is around 90% today, available 100% of the time regardless of the weather or demand patterns. Interestingly, moving New Zealand to 60% electrification would save Kiwi homes and businesses around $8 billion to $9 billion per annum in today's dollars. Electrification is the quickest way to lower total energy bills for Kiwi homes and businesses. Household and business economics will be the primary driver of growth in electricity demand over the next 2 decades.

The 3 COGS of Gen35 align to the 60, 95, 100 deliverables for the electricity sector and New Zealand. Incremental capital allows us to deliver for our customers, our shareholders, and New Zealand quicker. The investments proposed in our growth pipeline align with stated government priorities around security of supply, dispatchable capacity, and firming, and provide attractive commercial returns for shareholders.

As we have outlined, electricity demand in New Zealand is forecast to grow by around 25% over the next decade. This growth is structural and broad-based. It is driven by mass-market electrification, EV uptake and large new flexible loads, such as data centers and large-scale industrial electrification.

Importantly, this is not low-margin commodity growth. This isn't just more load, it is new types of load. Our large established customer book, advanced pipeline, and market-leading flexibility will allow Genesis to catch emerging value pools and manage risk within this market growth outlook.

As renewables grow, so does intra-hour, day and week volatility. Solar and wind already require growing levels of firming today, and Huntly is being used more to firm wind than in dry year cycles. Increased energy storage and dispatchable capacity remains essential in the New Zealand market across short, medium, and long-duration periods. Not only can Genesis firm its own current and future requirements across these periods, it can also provide a growing volume of energy and capacity products to the wider market, as we are already demonstrating. Our large established customer book underpins demand growth for Genesis. We are building new renewables in support of that, delivering earnings growth by further leveraging our market-leading flexibility.

Through our growth pipeline, baseload gas generation is being displaced as quickly as we can, and Huntly is monetized through short, medium, and long-duration firming for the Genesis customer book through more energy and capacity products to the wider market. As we outlined at Investor Day, greater energy storage and fuel flexibility options improve the GWAP-TWAP outcomes of our thermal assets. We continue to work through gas storage options at the Tariki field.

Firming is Genesis's competitive advantage. We can firm our customer book through all of New Zealand's hydro and wind cycles across minutes, hours, days, weeks and months. This slide sets out our view of unfirmed LCOE for intermittent renewables, our experience of the real firming cost ranges for intermittent renewables through both energy and HFO style products in dry and wet market conditions. As we outlined at Investor Day, we continue to see firming value pools as growing over the next decade.

In FY '24, Genesis had a pipeline of around 364 megawatts of solar and wind. Today, we have put in place a pipeline of around 2,500 megawatts, and this is growing. As we have indicated before, we will increase generation supply using on-balance sheet, joint venture, and pure PPA structures. On-balance sheet will prioritize, but not be limited to, energy storage and dispatchable assets. Joint ventures will be used to leverage third-party capital. PPAs will be used tactically to support demand growth and for strong capital management.

This slide sets out further detail on our overall development pipeline. The key message for investors is that Genesis has strong optionality, and optionality offers flexibility and value in a transition, overlaid by New Zealand's changing weather patterns. Our capital plan is phased to balance delivering growing operating free cash flows, options for strong capital management, and flexibility to drive competitive shareholder returns. This equity raise and our broader funding toolkit provide a solid foundation for Genesis to accelerate delivery of these outcomes.

Solar and BESS are being developed to drive improved GWAP-TWAP into our generation fleet, especially our 3 hydro schemes. Or we are investing to better leverage our dispatchable assets into higher-priced periods and to lower our overall average generation cost. Incremental capital will be used to accelerate delivery of this. By FY '32, we expect to deliver the following wind uplifts: the Kaiwaikawe PPA around 220 gigawatt hours per annum from quarter 3 FY '27. Mount Cass PPA around 210 gigawatt hours per annum from quarter 1 FY '29. Castle Hill not less than 800 gigawatt hours per annum from FY '32. Noting the FY '32 modeling assumes a low case of around 170 megawatts built. We expect to progress further wind options and will update the market in due course.

Huntly is not a legacy asset. It is a consented site with a 1,400 megawatt grid connection and a unique skilled resident workforce. On that site is a collection of assets, some legacy, some new, alongside a collection of fuels, some legacy and some future focused. When we launched Gen35, we were clear we would not maintain assets that we could not drive a commercially acceptable return from, and we have, and will remain true to this philosophy.

Over the past 2 years, we have demonstrated how we are now using the market-leading flexibility we have to defend our earnings during dry, low wind periods, and maximize our earnings through wet, high wind periods. We have also delivered 2 and 10-year HFO products. HFOs are a fixed annual revenue stream with pricing on a return on and return of capital over the contract period, and fuel and carbon costs borne by the HFO holder.

We are well into transitioning Huntly into a generation site that supports Genesis's large customer book and the wider sector's firming and security needs. This is good for customers, shareholders and New Zealand.

As we displace baseload gas generation, we intend to bring further HFO products to market on Unit 5. The structure of these will align to the Rankine HFO products and they will be available to all market participants. LNG, should it be developed, would be another fuel type that would be available to holders of future HFOs on Unit 5. Huntly will continue to play a firming role for Genesis and the wider sector, funded through both energy and capacity products.

Asset and fuel flex are central to our market-leading flexibility, leveraging it into earnings, as we have demonstrated over FY '25 and '26, is how we are deploying it. Key price points to be aware of are as follows. Gas at around $8 to $10 a GJ through Unit 5 beats current LCOEs for solar, wind and geothermal. Gas between $10 and $18 a GJ through Unit 5 delivers lower current generation costs than coal through Rankines. Above that, coal through Rankines deliver lower generation costs than gas through Unit 5. The economics of biomass remain currently above coal. LNG will be a fuel in our overall fuel portfolio optionality, should it become available.

I will now hand back to Julie to step through our capital management and equity offer details. Julie?

Thank you, Malcolm. So our approach to capital management remains unchanged from what I shared with you at Investor Day in November. Each investment we make must enhance our overall portfolio by maximizing our risk-adjusted returns across our integrated value chain, while maintaining our BBB+ credit rating and our commitment to our dividend policy.

As we shared at Investor Day, a critical enabler for strong capital management is ensuring a diverse and flexible funding toolkit that allows tailored capital solutions within the group's overall financial settings. Each funding pathway within our toolkit is used selectively to ensure it is the most credible and appropriate structure for the opportunity. And we are now in the phase of our Gen35 journey whereby we believe it is the right time for an equity raise offer of this size to supplement our operating free cash flow and enable the acceleration of the delivery of our growth investment pipeline, bringing forward funding certainty and working within the financial settings of the group.

We operate in a dynamic and cyclical environment, and this equity raise ensures that we have the resilience and flexibility to continue to invest and grow through volatile cycles to ensure strong returns well into the future.

Moving to our pro forma balance sheet. Under a mixed ownership model, it is important that this equity raise considers fairness for all of our investors while providing us with certainty to accelerate our growth investment pipeline. Initially, the cash proceeds from the equity raise will significantly reduce our leverage metrics before being deployed in alignment with the phasing of our growth investment schedule, as projects meet the requirements of our framework that ensures the best use of the funds for the targeted returns.

So coming back to our financial year '32 outlook that I spoke to earlier. Our normalized EBITDAF guidance for financial year '26 remains in the range of $490 million to $520 million. Our normalized EBITDAF for financial year '28 is increased to upper $500 million from the previously indicated mid to upper $500 million. This increase reflects our delivery to date and our confidence in the initiatives and the investments that we are progressing.

And today, we share our EBITDAF outlook range for financial year '32 of $650 million to $750 million, enabled by our growth investment pipeline of around $2 billion. This is a growth plan, and we will be growing our cash flow and our returns.

The Board continues to believe that the current fixed dividend policy remains appropriate and is likely to continue as we move through Horizon 2 of our Gen35 toward financial year 28, with an expectation that Genesis may return to a more market-aligned dividend policy beyond that, although noting that this will be a decision for the Board at that time.

This outlook and the opportunities that it is premised on are all about driving accelerated growth, both in the business and in the returns to our shareholders.

The $400 million equity raise is structured as a placement and a pro rata renounceable rights offer with the Crown commitment to participate to maintain a majority shareholding of 51%. The balance of the offer is underwritten. The rights offer is renounceable to ensure that those shareholders who cannot participate have the opportunity to realize value for their rights through the shortfall bookbuild.

There are a few key equity raise terms that I want to call out now. All shares issued under the placement and rights offer will not be entitled to the financial year '26 interim dividend. The placement share price is $2.15 per share, reflecting an 8% discount to the ex-dividend adjusted NZX last close price prior to the announcement. The rights offer share price is $2.05 per share, reflecting a 10.8% discount to the theoretical ex-rights price. Eligible shareholders that take up their entitlements in full may apply for additional new shares to be sold under the shortfall bookbuild.

Details of the timetable are offered in the offer prospectus, but I want to call out the key decision points for investors. For the placement bookbuild, we commence the trading halt today and placement bookbuild has started. Investors that wish to participate should contact their broker or Jarden today. Trading is expected to resume tomorrow, Tuesday the 24th of February, with settlement of placement shares happening later this week.

For the rights offer, shares will trade ex-rights from Friday the 27th of February, with the record date for determining entitlement being 7:00 p.m. on Monday the 2nd of March. The rights offer will open on Wednesday the 4th of March and close on Tuesday the 17th of March, giving shareholders just under 2 weeks to participate. Shareholders that wish to participate in the rights offer should visit the offer website for details.

So in summary, this equity raise provides shareholders with the opportunity to invest in a structurally growing electricity market with a differentiated portfolio built around flexibility and reliability. All with disciplined capital deployment and clear pathways to value realization. Genesis is not waiting for the energy transition, we are already monetizing it. And this equity raise allows us to do so faster, at scale and with confidence.

So thank you all for listening, and we're now going to hand back to the operators to take questions.

[Operator Instructions] Your first question comes from Grant Swanepoel with Jarden.

Great presentation. First question on your FY '28 dividend, still being on this incremental policy. If you, as a team have such strong conviction on high $500 million of EBITDAF, that strong cash flow conversion at that point, and you've also raised this $400 million, why aren't you considering revising that dividend policy at that point, assuming you have such a strong conviction all of those numbers at this stage?

Thanks Grant. Ultimately the Board felt that in this transition period and heavy investment period, that the philosophy they took into the fixed dividend held until FY '28. As we have indicated, as a matter of good governance, that is reviewed annually. The Board is very focused on ensuring competitive shareholder returns, maintaining BBB+ and accelerating our growth investment pipeline. And as indicated at Investor Day, we move back to a more market-aligned policy beyond from FY '29, subject to Board decisions at the time.

So could it be reviewed ahead of that if it's every year they review it? Last question, just on your FY '22 -- '32 guidance, that free cash flow conversion of 45% to 55% seems a bit conservative. And unless you're using a material maintenance CapEx. Can I ask you what maintenance CapEx you are assuming in FY '32?

Yes. So there are 2 parts to that one, Grant. The one is that we are still keeping within our $70 million to $80 million annualized stay-in-business CapEx. But what we have in there as well is the CapEx spend that prolongs the life of Huntly that was committed under the long-term HFOs, which to the round. What do we say now for the round.

What is that number for the Huntly maintenance CapEx in that year?

In that year or overall?

For your 2032 guidance?

Yes, across that period, it's in a range of around $100 million.

So it's $100 million over and above the $70 million to $80 million?

Yes, definitely above that, yes.

Our next question is going to be from Andrew Harvey-Green with Forsyth Barr.

A couple of questions from me. So first one is looking at the FY '32 EBITDAF assumption, I guess the earnings uplift would depend to some extent how you do the investment. So if you -- investments going forward, if you invest in joint ventures -- by joint venture, that doesn't go through EBITDAF. If you go with offtake agreements, it has a small uplift. And if you do it on balance sheet, it has a more substantial uplift. Can you give us a sense of, I guess, that renewable development total, I think, a 6 terawatt hour goal, how much of that development you expect to do on balance sheet versus, I guess, other mechanisms?

Yes, that's right, Andrew. Your statement is correct. And so the base assumption is that we will build Edgecumbe, Leeston and Rangiriri on balance sheet, best 2 on balance sheet. We have recycled -- we assume that we will recycle Edgecumbe and Leeston to fund wind development. And so they move from on balance sheet to a PPA structure. And we're assuming the wind in FY '32 is on balance sheet. So we haven't assumed any joint ventures with Yinson in that. And any joint ventures with Yinson would accelerate baseload gas displacement. And so it would be on a simple assessment of what is the highest and best use of capital around Unit 5 and investing in further wind joint ventures.

Okay. That's good color. Next question, I guess, is, I mean the government, when they sort of announced to support capital raises had some expectations around -- they're quite keen, I guess, on firming investments. You've announced or indicated you've got the second stage of the best. Have they placed any expectations on Genesis around how that $400 million will be spent?

No. We've put forward our strategy as articulated to the market and are investing into that strategy.

Our next question is from Vignesh Nair with UBS.

Congrats on the strong results team. First one is a clarification really. On your FY '32 outlook slide, you have a long-run wholesale price assumption midpoint of $123 per megawatt hour. It's a bit lower than the midpoint from Investor Day. Has your view on long-run price changed at all?

Yes. So in essence, we've done a -- because we're in a equity raise we've done a recalculation of that and we've adjusted our range, but we've also broken out in that slide that we spoke to with the LCOE and the firming costs, Vignesh. One thing I think is important to understand when you are analyzing the forward price curve is everyone analyzes it on a P50. And firming becomes materially more expensive when you drop below P40. So what we've tried to display on that slide is the underlying LCOE for solar and wind, that we see in the market today, and then a dark grey box which shows you what a P50 style firming cost range might be, and then there's a lighter grey box which shows you what a below P40 firming price range might be. So obviously, firming becomes more value accretive in lower hydro cycles. Does that answer your question?

Yes. Yes, so is it fair to say your long-run price is now $123 midpoint versus $125 last time?

Correct, and that's the figure we've taken into the FY '32 modeling.

Okay. And second question, I suppose just a bit of commentary around Tariki would be helpful. I understand it's a bit of a moving piece at the moment, but just sort of commentary around timing, what maybe the preliminary findings and discussions have sort of led to would be quite helpful.

Yes. As we said at Investor Day, we have an option on Tariki for this year, and the team are continuing to engage on that. There's substantial subsurface work that needs to be done to establish that it is a viable option as a gas storage facility. At Investor Day, I think we estimated at 8 to 10 PJs in size. And so that work is continuing. We are continuing at pace at the moment. And so we want to drive to decisions this year on it.

And finally, if I might, just around the capital management plan. Where do you see net debt peaking and when?

Thanks for that. So wind is a big build for us. So really, wind is probably where it gets up the highest, so towards the latter end of the period, but it doesn't go over -- we're keeping it within our 2 to 3 range at the moment. So that's what we've been modeling on and our sensitivities are around that.

And as I mentioned, that capital recycling out of Edgecumbe and Leeston is focused on that managing inside that 2 to 3 range for the wind build.

Our next question is from Joshua Dale with Craigs Investment Partners.

Just first question, working through a bit of math here. Let's say you do come in at up to $500 million for FY '28, call it, $590 million or so. If you compound that by inflation at 2% to FY '32, you get to EBITDAF of $640 million, which is fairly close to the bottom of your FY '32 target range. Did you set the bottom of that range such that no new developments need to come online from FY '28 onwards?

No, is the short answer. No.

It looks like you get there on inflation alone, I guess, is what I'm saying.

Yes. But what you have to factor in is the decline in Kupe. Kupe is down to around $20 million by FY '32 and the displacement in baseload generation. And so -- but once you -- once we've finished the solar developments, the next large development is wind, and that's FY '30 to '32. So FY '32 is the first year you get the benefit of that.

So I guess what I'm saying Josh is -- sorry, what I'm saying is just a blunt inflation adjusted. You've got to also adjust for the decline in Kupe earnings and the forward pricing.

Got it. That's helpful. And on Slide 22 of your capital raise presentation, it lists your development pipeline. Just to keep things simple, if at all possible, is there a cutoff on that list that you see in terms of what developments drive your FY '32 targets? Or is it everything on there needs to happen?

No. So FY '32 assumes that we complete the building of Edgecumbe, given we've started it, that we progress with the building of Leeston and run at 0 solar farms and that we progress with BESS 2 and we progress with Castle Hill. Those are the underlying development assumptions. Obviously, the Rankine life extension sits in there as well.

Great. And just interested in -- any comments on the dependence on recycling capital out of solar projects to get to your FY '32 targets? How comfortable are you you can find a partner or buyer for those? And I guess, what are the risks to your targets if you can't?

Yes. So there are 2 dimensions to that. One is based on the discussions we've had in the market, we are confident that we could find capital recycling options. The second is that we have sufficient headroom that if we chose to manage our debt differently, we would still be able to progress even if we couldn't.

Your next question is from Stephen Hudson with Macquarie Equities.

Just on the gas diversion, was all of the EBITDAF impact there taken in the Kupe EBITDAF line?

Yes.

So the second half would kind of like a more normalized sort of $10 million of EBITDAF be a decent guess there?

Yes. So the difference between the first and the second half of FY '26 is current gas spot prices aren't conducive to getting that gas away to industrials, so it will go into generation.

Got you. And just a question on Huntly. There's a sort of myth, perhaps I perpetuated it, but that you have to burn an ultra-low spec fuel through Huntly to satisfy your conditions of operation, ultra-low ash content coal and the PT Adara is the only company that can supply you with that, and you've been busy sort of trying to find another supplier, I guess, from a security of supply point of view. Can you kind of pop that myth or validate?

Yes. So in answer to the first part of your question, there is an envelope for ash, which we have to remain inside, and that does influence where we can buy coal from. Indonesia sits inside that at the moment. We've obviously signed an agreement with BT Mining for 10,000 tonnes a month from the mine behind Huntly, which also sits inside that. And we have 2 other mines internationally that we've identified that we can take coal from and blend with other coal into that. So the diversification of the coal supply chain is well underway.

So the answer to the second part of your question is no, we're not solely reliant on Indonesia, and we are opening up other options in New Zealand and other international countries.

And what's sort of PT Adara like to deal with? I mean, have they flirted with or being instructed by the Indonesian government to adhere to coal export bans? Or are they relatively free of those kinds of interferences?

So the Indonesian government has export controls on coal and their negative export controls. So they relate to the requirement to sell a percentage of coal extracted to the domestic market. I think that's at 15% or 20% at the moment. And so the fact that it's a negative control means that an increased volume of coal production just means that 20% has to go to Indonesia, 80% to the -- can be exported. And we're obviously a very small buyer in the context of that. Japan is the largest buyer in the context of coal exports from Indonesia.

Okay. That's useful. Just a couple more. Just on S&P. I see that you're calculating the leverage ratio, including capital bonds and your remediation cost or likely remediation cost for Huntly and Kupe, I suppose. And you're doing that on a 12-month trailing basis. Is that the way Standard & Poor's looks at you? Or is it -- I know for sort of other companies, they look at sort of 3-year forward ratios, for instance?

Yes. So thanks for that question. No, that is the way that they are looking at us. So it's an EBITDAF backward of 12 months and then those adjustments that you see in there are the adjustments they do.

Got you. And that includes both Kupe and the Huntly ash cost...

Yes. All Yes, our total restoration costs that we're providing for.

Yes. And then just back to -- well, sort of 2 quick ones. Yinson, what's their appetite to put capital to work in renewables? Or are they just sort of an EPC player?

No. They are Malaysian-based, and they are very committed to deploying capital into renewables. Obviously, Mount Cass wind farm in Canterbury is the first wind farm that they're deploying in New Zealand. We don't have an equity stake in that. We have a 70% offtake. Principal reason is that happened after we had executed the original agreement and Mount Cass wasn't part of it. So both parties agreed to leave it out of the original agreement. And we've obviously had quite substantial discussions with them around our right of first refusal on co-investment and offtake.

Got you. That's useful. Last one, I promise. Your dividend policy is sort of flat or flat in real terms. So kind of 2% growth out to 2028, I think you're alluding to. So -- and then kind of presumably a percentage of free cash flow from there is what the Board will consider. From 2026 to 2032, you've got $2 billion of CapEx as a previous question sort of posed. Yes, you've got some revenue streams declining. But what's your best guess as to organic growth in the utility part of your business over that horizon? So ex Kupe, what's your underlying EBITDAF growing for the next sort of 6 or so years?

So sort of building it up, we see demand growth in electricity between 0.5% and 1% out to FY '30, a tick over 2% beyond FY '30. That's primarily driven by our belief that EV ICE crossover will happen around FY '30. And FY '30 plan assumes that our average cost of generation will come down by about $25 a megawatt hour based on the building of the renewables. Baseload gas generation will be gone from around FY '30 and Kupe will contribute about $20 million of EBITDAF in FY '32. So if you take $20 million off the FY '32 number, then you get the ex Kupe range.

So it's going to be -- I mean, excluding the sort of return on your $2 billion, it is actually going to be a pretty flat EBITDAF.

Well, that's at the bottom end of the range, not the midpoint or the upper end.

Maybe we'll take it offline anyway. It's a long...

We can take it out with you. We can help each other.

There are no further questions at this time. I'll now hand the call back to Mr. Johns for closing remarks.

Thanks, everybody, for listening in. I look forward to catching up with everybody in the next couple of days.

Thanks, everyone.

That does conclude our conference for today. Thank you for participating. You may now disconnect.

[Foreign Language] Good afternoon, everyone. I'm Barbara Chapman, Chair of the Board of Genesis Energy. On behalf of my fellow directors, our Chief Executive and the executive team and all Genesis employees around New Zealand, welcome to our 2025 Annual Shareholder Meeting. We continue to hold this meeting in a hybrid form and very much appreciate those shareholders who are able to attend.

As always, our online streaming facility is available for those who couldn't be here in the room today. It's great to host this event in Otautahi Christchurch as part of our plan to move around New Zealand's major centers each year. It's off script, but I'm from Christchurch. I went to school in Uni down here, so it's great to be back. Before we start, just some quick housekeeping for those in the room. The bathrooms and fire exits are all down the hall. If we hear a fire alarm and a request to evacuate, please follow the hotel staff and use the stairs, assembling in the courtyard outside towards the airport terminal.

In the event of an earthquake, stay put, drop, cover and hold. For those joining online, today's meeting is held via the Computershare online meetings platform. This enables you to read the company documents associated with the meeting and ask questions through the platform. Online attendees can submit questions during the meeting by selecting the Q&A tab on the right half of your screen at any time. [Operator Instructions] Alternatively, you can call Computershare on 0800-650-034. Please note that while you can submit questions online from now on, I will not address them until the relevant time in the meeting.

Please also note that your questions may be moderated or if we receive multiple questions on one topic, amalgamated. Due to time constraints, we may run out of time to answer all your questions. If this happens, we'll answer them in due course via e-mail. For those present in person, during question time, simply raise your hand, and one of our attendees will bring a microphone to you. As this is streamed online, it is important that you wait for that microphone.

Turning now to today's agenda. We will move through the Board highlights from the year, the Chief Executive's overview and the Q&A session, the resolutions and then general business. If there are any discussion points that you feel haven't been covered in today's meeting, please reach out to our Investor Relations team at the e-mail address [email protected].

Four directors require reelection this year under the NZX director rotation rules. They are Catherine Drayton, Warwick Hunt, Hinerangi Raumati-Tu'ua, and Tim Miles. We are seeking a fourth term for Tim as we're in the midst of some significant technology projects and Tim's expertise has and will continue to be valuable as we bring those to a conclusion over the next 12 to 24 months.

We also put forward David Baldwin for election as a director following his appointment by the Board effective from the 1st of October. You will be able to vote on today's resolutions, either in person or for those online using the Computershare platform. I will refer to the instructions on how to vote when we reach that part of today's meeting. With us today are members of our executive team, including our Chief Corporate Affairs Officer, Matthew Osborne, who will fulfill the role of Secretary for this year's meeting. Silvio Bruinsma is here representing our external auditor, Deloitte.

Notice of the meeting has been duly given to shareholders, and we have the required quorum. I now declare the 2025 Annual Shareholder Meeting of Genesis Energy Limited officially open. Thank you all for joining us here today. To begin, let me introduce your Board of Directors. You will note that the names of the committees of which they are a member have changed. In June this year, the decision was made to separate the Audit and Risk Committee into 2 discrete committees, an Audit Committee and a Markets and Risk Committee.

The Markets and Risk Committee was established to assume the risk and market trading responsibilities from the Audit and Risk Committee. The role of committees is to enhance the effectiveness of the Board in key areas while still maintaining Board accountability. Dividing the Audit and Risk Committee into 2 separate committees did not result in an overall increase in directors' fees.

So I'll start with Hinerangi Raumati-Tu'ua. Hinerangi joined the Board in March 2022, She's a member of the Audit Committee. Hinerangi is Chair of Tainui Group Holdings and serves on the boards of a number of entities, including Taranaki Iwi Holdings Limited and Guardians of New Zealand Superannuation. She brings extensive governance experience, having chaired on and served on Iwi Boards and those in various sectors, including water, fisheries, local government, public trust and the Reserve Bank of New Zealand. In addition to her strong commercial investment and corporate governance background, Hinerangi was named Maori Business Leader of the Year in 2016 and served on the Cullen Tax Working Group in 2019. Last year, she won the Maori Leadership and Finance award at the Institute of Finance Professionals Awards. Thank you, Hinerangi.

Warwick Hunt. Warwick joined the Board in October 2022. He is a member of the Audit Committee and the Markets and Risk Committee. Warwick brings over 30 years leadership and governance experience as a partner and then managing partner of PwC New Zealand, Europe, Middle East, Africa and U.K. Warwick has worked across a range of sectors, including energy, professional services, financial services, agribusiness and aviation. He is Chair of the Bank of New Zealand, a Non-Executive Director of National Australia Bank and an executive fellow of King's College London Business School. He's a fellow chartered accountant in Australia and New Zealand and an honorary fellow of King's College London. Warwick is a member of the New Zealand Order of Merit for services to business. Thanks, Warwick.

Tim Miles. Can I just get this moving a little faster, please? Tim joined our Board in 2016, coming to us from his previous role as Chief Executive of Spark Digital. He is Chairman of the Human Resources and Remuneration Committee and a member of the Nominations Committee. Tim has had a long executive career in customer and technology-focused roles both in New Zealand and internationally. He is Chairman of Fortysouth Limited, a Director of ASX-listed company, oOh!media Limited. Tim has served as a director of companies in the fields of technology, finance and property. Thank you, Tim.

Catherine Drayton. Catherine joined the Genesis Board in March 2019. She is Chair of the company's Audit Committee and a member of the Markets and Risk Committee. Catherine is a former senior partner at PwC, specializing in mergers and acquisitions, culminating in her leading the assurance and advisory divisions in Central and Eastern Europe. Her extensive cross-sector governance experience includes multiple directorships across Iwi organizations in the energy, health care and infrastructure sectors. She is a former Chair of Guardians of New Zealand Superannuation. She is currently Chair of Mint Innovation Limited and Connexa Limited, and a Director of IAG New Zealand Limited and Warren and Mahoney Limited. Catherine is a fellow chartered accountant in the New Zealand and Australia. Thanks, Catherine.

James Moulder. James joined the Board in 2018. He is Chair of the Markets and Risk Committee and a member of the Audit Committee. James has strong governance experience, having held a number of nonexecutive board and advisory positions in the electricity and carbon industries. He has previously held executive management positions at Mighty River Power, which is now known as Mercury Energy. Prior to joining the Genesis Board, James advised the Singaporean government in the development of electricity hedge trading markets. More recently, he's been involved in the development of carbon and environmental markets in Asia. James' background advising the New Zealand electricity sector's regulatory bodies also strengthens the depth of our sector experience. Thanks, James.

David Baldwin. I'd like to introduce our new Director, David Baldwin, who joined us on 1 October. Just need to speed this up, please. David brings more than 35 years of international leadership and governance experience across Asia Pacific, Europe and North America. He has held senior executive and director roles spanning renewables, gas and LNG, utilities, chemicals and infrastructure asset management. His career includes leadership positions with Contact Energy, Origin Energy, Shell and Berkshire Hathaway Energy. Most recently, David was a Senior Managing Director with Macquarie Asset Management, where he advised and served on the Boards of energy, infrastructure and private equity portfolio companies.

David is currently a Non-Executive Director of energy companies in the Philippines and the United States both in the Macquarie Asset Management portfolio. You'll have the opportunity to meet David later and vote for his election. Thanks, David.

I'd like to take this opportunity to acknowledge former Director Paul Zealand, who retired from the Board after 9 years of service. Paul was a member of the Human Resources and Remuneration Committee and the Nominations Committee. Paul's input to the direction of Genesis, his skills in health and safety and his careful stewardship was invaluable. We thank him for his expertise and dedication to the company and wish him all the best.

On the screen now is our Board skills matrix, a summary of the skills we consider necessary for the company's success and an assessment of the skills held by directors. The matrix shows a very strong breadth and depth of expertise and secondary skills held by your Board. Succession planning is important. With Paul's departure, we assessed the skills we needed in a new director and undertook an external search. As mentioned, David Baldwin brings wide experience in renewables, gas and LNG, utilities, chemicals and infrastructure asset management and has a particular interest in health and safety. His expertise will greatly assist the Board in decisions we need to make in those areas in the years ahead. We're committed to being transparent about our opportunities, targets, strategy and progress and also about our challenges, the impacts we have and how we address those.

At its core, Genesis is an electricity generator with strong commercial investments adjacent to and in support of this. We deliver shareholder value through 4 primary areas, our large and loyal customer base, growing our renewable generation supply, monetizing energy security through our substantial flexible generation assets and fuel diversity and our commercial investments. Through our reporting, we seek to present a balanced view of how we create value over the short, medium and long-term.

Our annual reporting suite includes a fully integrated report where our commercial performance is supported by relevant environmental, social and governance metrics, a climate statement, a sustainable finance report. They can be found in the investment center on our website. The Board has a strong and effective working relationship with the company's Chief Executive and the executive team. It's pleasing to see the progress Malcolm and the team have made in the delivery and execution of our Gen35 strategy to deliver earnings growth and sector-leading yields.

The business performance in FY '25 and accelerating delivery of key strategic outcomes is a testament to the strength of the executive and the senior leadership teams. Directors' remuneration was reviewed in the FY '25 year as part of the previously committed biennial review cycle. No increase in director fees pool was sought. Rather, directors achieved a modest increase in fees through reallocating the existing pool. As this reallocation was within the envelope of the current fees pool, shareholder approval was not required. Directors' remuneration will be reviewed again in FY '27. I'm proud to lead a strong and capable Board of Directors who provide their extensive experience and specialist skills for the benefit of the company, our stakeholders, the wider community and you, our shareholders.

During FY '25, the government undertook 2 areas of review. Firstly, the Commerce Commission and the Electricity Authority undertook a review of market competition. Then Frontier Economics was commissioned to undertake a review of the electricity market. That was peer reviewed and the government announced its response on 1 October. In addition, we received a letter from the Minister of Finance sent to all gentailers clarifying the government's position on gentailer capital structures. We welcome the clarification delivered with these announcements.

Gen35 is very much aligned to the government's objectives, and the Board is now looking at ways we can accelerate the delivery of our strategy to further support those objectives. Malcolm will speak more to this soon. FY '25 was a challenging year with 4 very different quarters. Gas declining faster than forecast and other generators being caught short during winter 2024. We're proud that Genesis was able to support all our customers with our own generation across FY '25 and that none of our customers were exposed to the wholesale electricity market prices of winter 2024. This is the advantage of an integrated model and Genesis' flexible generation portfolio. For shareholders, our flexible generation portfolio links directly to earnings resilience as shown in FY '25. We acknowledge that recent price changes have been felt by our customers, and we're doing all we can to minimize these.

However, around 60% of the FY '25 price rises were driven by increases in regulated power line charges which we pass through on behalf of the power lines companies. Those increases are not increases from Genesis. They are approved by the Commerce Commission every 5 years and all retailers pass them on. There are further lines increases from the lines companies still to come, and these will impact customer price rises over the next few years. Notwithstanding those increases, we believe wholesale electricity prices are now past their peak.

The announced pipeline of new generation out to 2030, coupled with increased firming products we've brought to the market will bring downward price pressures to the market. Normalized EBITDAF was up 15% to $470 million, and reported net profit after tax was up 29% to $169 million. This result was driven by improved margin outcomes from our retail business, resulting from the transformation program we are successfully executing. This was further supported by improved trading and operational outcomes of Genesis' generation and fuel flexibility.

Normalized EBITDAF is showing pleasing improvement when you look through the technology replatforming projects, but we do expect NPAT will continue to move around, driven by electricity derivative valuations. As a result of our solid EBITDAF and net profit after tax, the Board declared a dividend of $0.143 per share. This provides a return on investment to shareholders while also enabling progress on our capital program to support future growth.

Looking ahead, as announced on Tuesday, FY '26 normalized EBITDAF is expected to be between $455 million and $485 million. This remains subject to hydrology conditions, gas availability and price, plant reliability and stable market conditions. Our digital investment will peak in FY '26 before returning to a stay-in business level of around $15 million to $20 million per annum by FY '28. We have 3 critical technology platform upgrades being delivered, our retail billing system, our financial management system and our electricity trading and risk management system.

In addition, we have an increase in forecast carbon costs in FY '26, driven by historic carbon hedges, which are currently above the depressed carbon spot market. We're also budgeting for increased gas costs in the second half of FY '26 as existing contracts expire and new contracts reprice accordingly.

Safety is a whole of business focus and the Board plays an active role. We are pleased to attain ISO 45001 accreditation during FY '25. Reaching this international standard confirms our commitment to maintaining and improving safety standards for our people.

Overall, safety performance improved across the business in FY '25. However, LPG remains a focus for further work. We have a proactive plan in place to keep driving overall performance, which includes our focus around our critical safety risks and on LPG outcomes. After launching our Gen35 strategy in November 2023, we're delivering what we said we would. Gen35 is focused on 3 key things: firstly, optimizing our large customer demand position. Secondly, building renewables to support our 3 hydro generation schemes. And thirdly, monetizing our competitive advantage in flexible generation.

Through these 3 key focus areas, we will deliver sector-leading yields while strongly managing our capital. We are in horizon 2 of Gen35, which covers FY '25 to '28. The key deliverables are the 8x8 initiatives and a general uplift in business as usual.

Customers remain a critical focus. We want to offer our customers simple but innovative products using efficient operating structures and keep introducing ways for them to lead their own energy transition. We are delivering our strategy and have growing confidence in providing earnings uplift to upper to mid-$500 million EBITDAF by FY '28, subject, of course, to hydrology conditions, no major unplanned outages or any major changes in operating context.

We opened our first solar farm at Lauriston here in Canterbury, which is now generating up to 100 gigawatts of electricity a year, enough to power around 12,500 households. We expect to reach final investment decision on 2 more solar farms during FY '26. Edgecumbe in the Bay of Plenty and Leeston in Canterbury and the Foxton solar farm is currently in the fast track consenting process. We are also well advanced in the construction of our first 200-megawatt hour battery at Huntly Power Station, capable of powering about 60,000 average households for 2 hours a day. The battery is expected to be operational by early FY '27.

It will cost around $135 million compared to other similar battery systems being quoted as costing up to $180 million. This illustrates the benefits of a strong capital management approach and developing at the established Huntly site. The swift delivery of new generation assets and valuable PPAs since we launched Gen35 is a testament to how we have quickly put in place the capability to procure, build and deliver new generation. Gen35 is focused on putting place the platform for ongoing earnings growth while retaining strong management of our capital.

As I have outlined, we are building new renewable generation and contracting new renewable supply where it is value accretive to shareholders to do so. The capital management approach to delivering new generation is comprised of 3 solutions: One, direct on-balance sheet investment, where we will generally prioritize assets that store energy are dispatchable or also provide second order portfolio benefits. The Huntly battery project is an example of that.

Secondly, directly leveraging third-party capital, where we form joint ventures with third-party capital providers to build new renewable generation and Lauriston solar farm, which opened in FY '25, is an example of that.

And then thirdly, indirectly leveraging third-party capital, where we write long-term PPAs with third-party generators. Those are power purchase agreements. The start of our Tauhara geothermal power purchase agreement in FY '25 is an example of that. These 3 types of growth capital structure will form the foundation of how we deliver new generation that is value accretive to Genesis shareholders.

We have a number of investment opportunities to explore. We're reviewing them carefully, and we'll decide on funding requirements once that part of the job is completed, and we're moving at pace in that regard. As I said before, it's good to have clarity on the government's willingness to participate in potential equity raisings that may be required to support energy security and affordability objectives. We're currently reviewing all our options, including potential additional equity requirements, and we'll do what's necessary and appropriate to support the execution of our strategy at the relevant time. We're very aware of the importance shareholders place on dividends. And the Board is continually reviewing the balance between investing for the future, maintaining sector-leading yields and retaining our BBB+ credit rating over the long-term.

The Board is also conscious of delivering total shareholder returns overall. The share price growth of around 19% over the past year has been pleasing to see. We expect the delivery of Gen35 to become more evident in our earnings and shareholder returns over the few years. While we met our emissions reduction target for sold products in FY '25, we faced several challenges that affected our ability to achieve our target of emissions reduction from generation. Generation emissions were 6% lower than the FY '20 baseline compared to a target of 36%. And as we've said before, our missions will inversely reflect wind and rain conditions in New Zealand for some years to come. We remain committed to net-zero by 2040, focusing on building new renewables to serve our customers in fuel transition, in our thermal generation, including biomass to lower our future emissions outcomes.

We will continue to report transparently on progress, challenges and assumptions regarding emissions as the business activates Gen35. This approach ensures stakeholders understanding both the ambition and the practical realities of delivering a low emissions future.

Our business relies on the expertise and commitment of our people. To attract and retain the best, we need high engagement and alignment in a culture of high performance and trust. So it was pleasing to see many of our employee survey results remain above the national benchmark despite the major structural changes that occurred during FY '25.

The survey's overall engagement score was 79%. Of these, 87% have a high level of trust in our leaders and 91% feel safe at work. We thank all our people for their dedication to our customers and the business through what has been a demanding year. Care for our people extends to those in the communities in which we interact. Genesis invested $5.6 million in community initiatives during the year, more than doubling the prior year's contribution. This coincided with the launch of our community investment framework aligned with our long-term objectives, focusing on positive social and environmental outcomes for communities connected to Genesis' generation assets.

Iwi relations are important to us, and this year, we welcomed Kruger Wetere as Pouhere Maori or General Manager, Maori. Kruger supports the development and enhancement of relationships with Iwi around our existing and developing generation sites, including exploring opportunities to develop commercial partnerships and our implementation of a Rautaki Maori or Maori strategy to lift the cultural capability of our people and define our areas of commitment with internal and external stakeholders.

In conclusion, along with my fellow directors and our Genesis Energy team, I would like to thank you for your ongoing support of our company. FY '25 has been a challenging year in a dynamic decade for the energy sector. This year's events have underlined our long-held view that a renewable transition must also deliver energy security and reliability. We will continue to engage constructively with regulators to help ensure a workable pathway for new renewable generation while maintaining our focus on security of electricity supply and affordability for our customers.

I have every confidence that your Board, overseeing our strong executive team will maintain the company's position as an essential and profitable part of New Zealand's energy future, while at the same time, living up to the company's purpose and vision.

Finally, I do want to acknowledge the awards that Genesis has been recognized for in the past year across our wholesale and retail segments. This included being named Energy Retailer of the Year at the Energy Excellence Awards. This is a credit to the whole team and the valuable contribution they make to our customers in the sector.

It's now my pleasure to invite your Chief Executive, Malcolm Johns, to address our shareholders. Welcome. Malcolm.

[Foreign Language] to everybody [Foreign Language]. From whenever you are listening around the country or offshore, a warm welcome, and thank you very much, Barbara. It's a pleasure to speak to you today and review both our FY '25 performance, what we have delivered to date and what we will deliver over the next few years through our strategy, Gen35. Let me first start by introducing our executive leadership team. Tracey Hickman is our longest-serving executive leader, having been with Genesis since it was first formed. Tracey leads our operations, asset development, fuels, environmental, sustainability and Iwi and community relationships functions.

Matthew Osborne has been with Genesis for over 5 years, and leads our legal, government relations, procurement and communication teams. Ed Hyde joined Genesis in 2023 and leads our strategy, technology and transformation teams. Julie Amey joined us in November last year as our Chief Financial Officer and leads our finance team, including reporting, risk management, performance and capital market functions.

Stephen England-Hall joined us in 2023 and leads our commercial business units, including the customer, trading and portfolio teams. Claire Walker joined us in 2023 and leads our people and culture areas, which include culture, safety, wellness and our talent development units. This team has largely been in place since we launched Gen35, and I'm proud of what we have delivered over the last 2 years. Genesis is a transition within the energy transition. Since we launched Gen35 in November 2023, both transitions have gathered pace. Delivery has and will remain at the center of this team's focus.

Core to Genesis' portfolio is our large customer position of around 520,000 customers spread across the whole of New Zealand. Our 3 hydro schemes producing around 2.8 terawatt hours of electricity on average each year, and our very large flexible generation and fuels portfolio. This provides a generating cost ceiling to our -- through all national hydro cycles. These elements of our portfolio drove FY '25 solid EBITDAF performance of $470 million in what has been a very challenging year for the sector. This was an excellent result, and I'm proud of how our team navigated the business through all 4 quarters of FY '25. We are delivering our strategy and seeing commercial uplift in all areas of the business.

Operations free cash flow was $147 million. This, coupled with our accumulated cash reserves, were used to fund our growth investments of $165 million and to finance our dividend distribution of $116 million. No new debt was needed, moving our EBITDAF to debt ratio down slightly from 2.8x to 2.7x, remaining within the 2x to 3x range targeted for our BBB+ credit rating.

Genesis' competitive advantage is the flexibility in our generation assets and fuels, with our 3 hydro schemes and Huntly Power Station at the core of this. Our flexibility allows us to generate when the wholesale electricity market is high, actively providing a ceiling on generation costs for our energy sales to our customers and protecting our margin as we did through FY '25. We can then turn that generation down when the market is priced low. Purchasing cheaper electricity to supply our customers and increasing our margin as we have been doing during FY '26. This is what drives our excellent margin resilience. Our teams are mastering this flexibility and how to turn this competitive advantage into real cash returns for our shareholders through both the wholesale electricity market and the capacity contract market that we have created for Huntly Power Station.

The market doesn't always need our flexible generation, and that has meant previously we weren't getting paid for being on standby. We have now Introduced both 2-year and 10-year capacity contracts for our generation to be on standby. These are known as Huntly firming options or HFOs. HFOs attract a fixed annual payment to Genesis from the HFO holder for us to be on standby. This means Genesis now gets paid for HFO standby generation regardless of whether the market needs that generation or not. HFO holders also pay directly for fuel and carbon costs releasing working capital back to Genesis. The 10-year HFOs we have agreed with Mercury, Meridian and Contact Energy will see a reserve coal stockpile of 600,000 tonnes put in place at Huntly Power Station, funded equally 4 ways between the 4 companies.

This will release around $100 million in working capital back to Genesis in FY '26. We will maintain an operational coal stockpile at Huntly of between 350,000 and 550,000 tonnes to directly support Genesis customers over and above that 600,000 tonne reserve stockpile. Currently, there is around 1.1 million tonnes of coal on site at Huntly. 600,000 tonnes for the reserve stockpile and 500,000 tonnes for the Genesis' operational stockpile.

If you look at the graph on the screen, you can see our customer demand on the left-hand side and our FY '25 generation in the middle. You can see the market didn't need all the generation we had to offer, so we didn't get paid for having this on standby for the system. The FY '28 column shows the impact of the 2- and 10-year HFOs I have just mentioned. We will now get paid to have this generation on standby regardless of the national wind and rain conditions. You can also see that we can offer the market more short, medium and long-dated electricity security products, which we intend to do.

This will offer generators, retailers and industrials, a choice of products to add price stability to their future electricity demand and avoid the consequences of winter 2024. System security needs to be funded fairly by all market participants. This hasn't been the case in the past, and the system got caught out in winter 2024. We welcome the government's recent announcements that it wishes to put in place a more structured and monitored regime for market participants to hold appropriate standby generation contracts for long-duration energy security. Fuel and reserves are the key elements of having Huntly Power Station on standby for the country and for energy security. Optimizing working capital deployed for fuel reserves is critical to Genesis.

And during FY '25, we have built a formidable fuels team to drive this commercial uplift. The team has already introduced new coal management systems and contracts and enhanced our domestic supply of coal from new contracts with BT Mining for around 120,000 tonnes per annum. We are also well into work on diversifying our international supply options from mines outside of Indonesia, and we'll be trialing an option from Australia in 2026. We are also currently exploring multiple options from other countries in addition to this. However, these are in the early stages of engagement. Our team has introduced more dynamic management of our gas position with increased flexibility through FY '25 being a major contributor to our EBITDAF resilience. They are stepping up to another level in FY '26.

While hydro at our battery are well suited to supporting firming of the system across minutes and hours, coal is well suited to firming across weeks and months. However, New Zealand is not well served across days and weeks. Gas has traditionally played this role, but it is declining faster and is more expensive than forecast. There are now increasing uncertainties on both the supply and the demand sides for gas over the coming years. Methanex and Genesis, our 400-megawatt turbine, Unit 5 at Huntly Power Station are the 2 largest gas users in New Zealand and have served to underpin the upstream sector for some decades.

Gas decline for other customers has essentially been cushioned first by Methanex until it reached its minimum operating levels last year and now by Unit 5 at Huntly. Unit 5 can produce up to 3.5 terawatt hours of electricity a year. That's about 8% of New Zealand's current electricity demand. However, in FY '25, Unit 5 only produced 1.8 terawatt hours of electricity or 55% of its total capacity. And that is because gas was prioritized to Genesis' gas customers over our own generation. We expect the output from Unit 5 to fall further in FY '26 as industrial companies outbid electricity generators for gas supply, and we use coal when it is a cheaper fuel. The team is mastering how to use Unit 5 on a more seasonal basis and less of a year-round generation baseload basis.

Unit 5 will be fully depreciated by 2032, and offers the country substantial intraday and intra-season generation options for energy security, but that is subject to fuel availability, flexibility and pricing. We are following the government's recent announcements on LNG and retain our contract option on gas storage at the Tariki reservoir in Taranaki. Overall, Genesis used around 25 PJs of gas in FY '25. About 30% of this went to our customers across both homes and businesses. The remaining 66% went to electricity generation, which is currently acting as the buffer between a declining gas market and our customers' stable demand for gas.

The market is now allocating gas to the highest and best use, and we are now seeing regular examples of industrial companies outbidding electricity generators for that gas. We expect to see the customer share of our gas allocation increase into the future as this trend continues. As this graph shows, Genesis' ability to pivot between gas and coal is a major advantage currently. Our teams are managing this with increasing dexterity, and this is evident in our improving margin resilience. Kupe production remains broadly in line with forecast, and the joint venture has a capital plan to address the future changes as the field declines. Our position on Kupe remains the same as it was last year. We need the gas supply, but we do not need to own the asset.

However, there are no current live engagements around exiting our 46% holding in the asset. As Barbara mentioned, a key aspect of delivering Gen35 is building new renewable generation. We now have a solid pipeline over the next few years, as you can see on the screen. We will deliver this through the 3 capital management structures Barbara has outlined earlier. However, our learnings from the Lauriston solar farm have seen a small change in how we will directly leverage third-party capital.

Going forward, we will now develop and hold our own pipeline of future development options ourselves. We will build these options on our balance sheet and hold them until we decide it makes commercial sense to recycle the capital into the next development to grow earnings. This means we will begin recycling capital off the back of new developments rather than at the front as we did with Lauriston. This provides Genesis with more direct control over development optionality, time lines for development, capital management and cash flow benefit. We want to capture development margins and the government's 20% investment boost tax credit for our shareholders directly. It is this change of approach, which underpinned our mutual agreement with FRV to move in different directions going forward and to end our joint venture.

We are on target to deliver options to build up to 500 megawatts of solar generation, primarily to increase the value of our water and displace baseload gas generation in our portfolio. However, we do see some risk of solar being overbuilt. So we intend to maintain some flexibility in this objective. We are putting in place wind options, and we will continue to do so. Stage 1 of our grid scale battery project at Huntly is underway, and we are well into reviewing Stage 2. The balance of plant we purchased for Stage 1 was purchased to a level so it could accommodate Stage 2.

So we are well placed to deliver a Stage 2 battery at the most market competitive CapEx available. As many of you will have read, we are now extending the life of the Rankine units at Huntly out to 2035. Key to this investment are the 10-year Huntly firming options we have agreed with Contact, Mercury and Meridian. These are calculated based on a full thermal appropriate return on and return of capital over the contract period. Rankine Unit 2 was scheduled to go into retirement in February 2026. And we were well advanced with planning for this to occur when the interest arose to keep this unit in the market until 2035.

Subject to the Commerce Commission's final decision on the 10-year HFOs, we will now spend around $70 million over the next 2 years to extend the life of the Rankines out to 2035. As Barbara outlined, we are delivering 3 new performance-enhancing technology platforms, our retail billing and customer management system, our financial management system and our electricity trading and risk management systems. These are big technology projects equal to a heart and lung transplant for the business. They are never easy projects.

However, our teams are doing an excellent delivery job. Technology provides the opportunity to step-change productivity within the business, facilitating an uplift in our drive for a performance-based culture. In 2023, we set ourselves the ambitious objective of delivering these 3 technology projects within an overall envelope of $145 million, made up of around $18 million of capital investment and around $127 million of operating costs. We remain within the overall envelope and on time for overall delivery.

However, as the table on screen shows, the phasing of this spend has evolved as we deliver the different phases of the technology projects, and we expect this phasing to continue to evolve over FY '26 and '27 within the overall envelope. However, we do not expect any material changes in phasing at this time. We will update that any phasing changes in our normal reporting cycles. Once these large technology projects have moved through the system, we expect our technology spend to return to more stay in business levels of around $15 million to $20 million a year in today's dollars.

We believe AI can help unlock further productivity gains in all areas of our business, not just technology. This year, we continue to upskill our people in how to use AI effectively and continued applying it for use in generation, finance, retail, leadership development and customer service. We have governance in place to ensure consistency as we deploy AI across the business.

Moving now to retail. Genesis has built a strong customer demand position in what is a very competitive retail market. Our transformation process of retail is well underway to deliver our customers the services and products they need to help drive New Zealand's energy transition. We have seen pleasing improvements in our netback performance and very pleasing improvements in our productivity with a 22% growth in netback per full-time employee over FY '25.

As we have signaled, we are moving to a single brand strategy as part of that retail transformation. During FY '25, we completed the purchase of the remaining 30% of Ecotricity to take full ownership. We are also well into merging the Frank brand into Genesis. Overall, we see our customer demand position within the band of 6 to 6.5 terawatt hours per annum today, growing to between 7.5 and 8.3 terawatt hours per annum by 2035. One of our highest value channels to market is through EV customers or electric vehicle customers.

As we highlighted when we launched Gen35 in 2023, Genesis has a market-leading position regarding high-value EV customers. And during FY '25, we took a majority position in New Zealand's largest and fastest-growing rapid charging network, ChargeNet. We will have more to say about this at our Investor Day in November later this year. Genesis is proud to be New Zealand's largest distributed energy retailer with around 27,000 household customers with rooftop solar. Some 14,000 of these also now have household batteries. Combined, these households have a peak generation of around 189 megawatts and current total battery storage capacity of around 68 megawatts.

In January this year, a record 5% of our electricity generation duration was purchased from household customers. We expect this to grow as we are currently acquiring around 250 household solar customers a month with a much higher percentage of batteries. Our team is well placed and leaning into how we use this growing distributed energy resource within our overall portfolio flexibility to deliver our shareholders and our customers increased value. This is a key aspect of why we are upgrading our technology platforms.

Our relationship with our customers is changing, and we are changing as a retailer too. The Salesforce Gentrack customer billing platform upgrade will undertake its first live trial with a small cohort of customers in a few weeks time. Early testing is showing pleasing productivity advances from the customer resource management section of the software used by our call center and customer care teams. The utility technology space has become very competitive. Optionality has grown considerably in New Zealand over recent years and mature systems are advancing fast to support new services and products for our customers' energy transition.

Ecotricity has developed an impressive technology platform for solar and large commercial and industrial customers using Robotron software from Europe tailored to the New Zealand market. Now that we have this platform available to us, we are reviewing the opportunities to deliver technology benefits faster to our customers and to our business.

I would like to acknowledge some changes in our safety leadership this year. Claire Walker has become our Executive safety lead, bringing people, culture and safety into the same leadership team. Our long-serving General Manager of Safety and Wellness, Jarrod Bowler, retired during FY '25, and we would like to acknowledge Jarrod's extensive service and passion for all things safety inside Genesis.

Will Eastgate has joined us as a General Manager, Safety and Wellness. Will has a successful career in safety with excellent skills in safety culture development, safety risk management and process safety systems. As Barbara mentioned, we have maintained strong engagement, alignment and trust within the culture as we have embarked on one of Genesis' largest change programs ever. We made some reporting line changes at executive level during FY '25 to better support our people in accelerating the delivery of our strategy, including increasing our focus on core deliverables and making the most of the opportunities that have surfaced during our Gen35 journey. The executive has lent right into this and each member is delivering impactful change for our customers and our shareholders. We have also strengthened our senior leadership bench, as we build a delivery culture deeper into Genesis. We have a number of new senior leaders some are in the room today. We are investing strongly in developing our existing senior leadership team, and we are building resilience and performance and delivering commercial outcomes.

Genesis is delivering the change we said we would under Gen35 and doing it in a dynamic time in the electricity sector. In terms of transformation activity, we will peak in FY '26. And begin moving towards Genesis 2.0 across FY '27 and '28. We welcomed the clarity given by the government's response to the Frontier Report. And Gen35 is well aligned to supporting the objectives set out in those announcements and to deliver for the country and for our shareholders. There is an opportunity for Genesis and the government's announcements, and we are now actively reviewing how we can deliver our strategy faster and with more impact. The government announcements do come with processes that will play out over several months. And as these play out, we will gain greater clarity on the benefits that might arise for Genesis.

We will update investors on our strategy delivery at our planned Investor Days on 26 and 27 November this year. We will live stream the key parts of the first day and will be in touch soon with details on how you can join that broadcast. Right now, we have an awesome team doing some cool stuff, I am incredibly proud of them and what they are delivering for our customers and for our shareholders. Thank you to the Board for their support, wisdom and guidance as we build our team to deliver Gen35. Most of all, thank you for your support as we build an electricity company where energy never stops. I will now hand back to Barbara. Thank you, Barbara.

Thanks, Malcolm. There's some 3 steps left to go in this meeting just to keep you on track. The first is we -- you have an opportunity now if you would like to ask questions on the presentations that you've heard from myself and Malcolm. The second is the formal resolutions that we vote on, the team that are up for reelection this year. We get the chance to vote on that. And then there's a more general Q&A, the session that we can have after the formal resolutions.

So in relation to that first step, questions on -- from the floor are now open. If you'd like to indicate by raising your hand, we will bring a microphone to you. So please remember that this meeting is being webcast, so it's important to speak into the microphone, and we'll then take questions from our online shareholders. So are there questions from the floor on the presentations that you've heard? Keep rolling along. Are there online questions, Matthew?

Yes, there are quite a few online questions actually. I'm going to start rolling through those?

Yes, please.

Okay. The first question we have from the New Zealand Shareholders Association. We note that under the Public Finance Act of 2001 that the Auditor General appoints the auditor and ensures the lead audit partner is rotated every 5 years. There's no disclosure of the date the lead audit partner and audit firm was appointed nor the policy on audit firm rotation. In light of events overseas and recently within New Zealand, the NZSA believes it is important that companies have a clear audit firm rotation policy and a process to regularly test the market as regards audit fees. Can you please comment?

Look, I'd just like to comment that, of course, the New Zealand Shareholders' Association and others know that the audit company is appointed by -- not by us, but by Crown Entity. And so we are very comfortable with that. In terms of specificity around timeframes and things, I'm quite happy to include that in disclosures going forward, unless that causes Deloitte any concerns, Silvio. No. Okay.

Next question.

Yes.

The company does not participate in the IOD's future director program designed to develop and mentor the next generation of directors. The NZSA expects NZX 50 companies to participate as part of a responsibility to develop and mentor the next generation of directors. Can you please comment on this?

Thank you very much again. That concern is noted. Not every company in New Zealand appoints a future director. I think the balance of skills and the complexity we have with our business and the people we have around the table is an excellent combination. At a certain point in time, we -- I wouldn't rule it out. We might engage a future director, but it's not been on our horizon for the moment.

And the final question from the NZSA. Whilst the annual report includes a skills matrix, it does not attribute skill sets to individual directors to demonstrate how they individually contribute to the governance of the company and add value. Are you in a position to attribute skill sets individually in the future?

The Shareholders Association has sent me an example of what they believe is best practice around the skills matrix that was received after this year's skills matrix went into print. And so that's something that we can consider for next year.

Next question is from a shareholder, Gordon Lareau. What is the biggest cost saving for year 2026? Interested to hear comments from Board of Directors.

Malcolm, I might pass it to you.

We have an ongoing productivity program within Genesis. And so I would describe cost savings in Genesis as a bubble bath approach rather than a big bang approach. So there's no part of the business that is not undertaking some form of cost optimization at the moment. Artificial intelligence and the productivity gains that, that offers does represent our largest cost saving over the next 2 or 3 years. And you'll see that start to become more prominent in our reporting probably from FY '26 onwards.

And an evidence of that is if you look at the salary line for Genesis this year, we absorbed inflation inside that line, and we would expect to continue to improve our performance on that. That's the first year that we've been able to achieve that absorption. So the 22% productivity gain that I mentioned in my speech is indicative of the work that is going on to try and hold our OpEx line flat. And so if you look at our reporting, you'll see that we're reporting on core business, and we're reporting on projects. So we do have a large OpEx for the technology projects that are in play at the moment. We would expect to return to more normal business as usual levels in the years to come, but we are separating out what's happening at a core level versus a project level.

Next question is also from Gordon Lareau. What is the Board/Business doing about acquiring new customers that are shareholders, but not yet customers of Genesis? Does Genesis plan on offering some form of incentive for shareholders who are not customers to become Genesis customers?

The answer to that is no, we don't have that on our horizon. I think the customers that we attract, the team are very careful to make sure that we get the right customers into the company, customers who can actually support the company and add value in the long-term, but we don't have that kind of scheme in play, and it's not in the pipeline.

Next question is from Oliver and Hildegard Colman. Genesis owns Ecotricity, the only carbon positive certified electricity retailer in Aotearoa. What are your plans for Ecotricity with regards to consolidating your retail brands?

You will have read that we are consolidating our retail brands. For example, the Frank brand is being taken out of the market, and there's work going on in and around synergies for Ecotricity. That was a very good acquisition for the company. We're very pleased with how that is going, and we'll just keep moving forward with how we manage these brands together.

Next question is from Warrick Gould. Why the sudden drop in gas price between August and October 2024?

Not in my memory horizon, Malcolm?

As I mentioned in my presentation, the gas market is effectively out of balance. There's too much demand for the supply of gas in New Zealand. So very small movements, particularly on the demand side, can create very big movements in the price of gas in New Zealand at the moment. And so you've only got to get someone close a dairy factory somewhere in New Zealand and put that gas back into the market, you'll get a very big reaction from the market on that. And we can expect that volatility in the gas market to probably persist for the foreseeable future.

Next question is from Stephen Mayne, relates to Tim Miles' election. He notes that Tim sits on the board of ASX listed oOh!media, and that a remuneration report is typically presented and voted on Australian AGMs. Would Genesis consider doing similar and prepare an annual remuneration report similar to what the likes of Xero and Fletcher Building currently do? Could Barbara, please comment on this?

That's not on our horizon, Stephen.

Okay.

Just in the interest of time, Matthew, are there any more online questions?

There's 2 more, both from Stephen Mayne. Okay. Most New Zealand-domiciled dual-listed companies present a resolution at their ASM approving the audit fees. Why was this resolution not presented on the ballot today or at last year's AGM? Does it have any impact on the auditing process, pricing or tender regularity?

I'm very comfortable, Stephen, with where we are in terms of our audit fees. I think they are fair and reasonable to the company, and that is the test that my fellow directors and I will use when we consider audit fees.

And the third and final question from Stephen Mayne. It's a long one. What does the government's announcements about the potential sale of its shares in Chorus mean for Genesis? As an Australian-based shareholder, I'm not across the NZ privatization debate. So could the Chair please explain the history of the government's 51% stake in Genesis?

I think that, that's quite -- would be quite a long answer, Stephen. So I think that's something -- could I ask the Investor Relations team, please to take off-line and give Stephen a hand in just understanding how this place is set up.

Happy to do that. That's the end of the online questions.

Okay. Now let's move to the formal part of the meeting. We have resolutions on which to vote. For those present, if you do not have a pen or a voting paper and would like one, please raise your hand and a Computershare representative will come and hand you one.

For those of you online, you may cast your votes through the Computershare platform under the vote tab. Once voting has opened, the resolutions will allow votes to be submitted. To vote, simply select your voting direction from the options shown on the screen. You can vote for all the resolutions at once or by each resolution. Your vote has been cast when the tick appears. To change your vote, simply select change your vote. You may change your vote any time until I declare that voting has closed. You'll be able to raise questions before I formally put each resolution forward for voting. For those present in person, again, please raise your hand, and we'll bring a microphone to you.

So Resolution 1 proposes that Catherine Drayton be reelected as a Director of the company. The Board has confirmed that Catherine is standing as an independent director. The Board recommends Catherine to you as a Director of Genesis Energy Limited and unanimously supports her reelection.

I now invite Catherine to address the meeting.

[Foreign Language] I'm Catherine Drayton and thank you for the opportunity to stand for reelection. So whilst I've been on the Board for 6.5 years, I believe I still have a contribution to make, monitoring the prosecution of the Gen35 aspirations, emphasizing the importance of insightful stakeholder engagement; and finally, constructively challenging management team on critical business cases, the opportunities, the risks and the counterfactual. So I ask for your continued confidence as I seek reappointment. [Foreign Language]

Thank you, Catherine. Is there any discussion on this resolution? Okay. There appears to be no further discussion. I now put to the vote the ordinary resolution that Catherine Drayton be reelected as a Director of the company. Can the auto queue keep up with me, please? We'll give you a moment to mark your voting form or vote via the Computershare portal in relation to Catherine's reelection.

[Voting]

Thanks. Resolution 2 proposes that Warwick Hunt be reelected as a Director of the company. The Board has confirmed that Warwick is standing as an independent director. The Board recommends Warwick to you as a Director of Genesis Energy Limited and unanimously supports his reelection. I now invite Warwick to address the meeting.

[Foreign Language] I am Warwick Hunt and delighted to seek reelection as a Director of Genesis. In doing that and recognizing that I've been on the Board for the last 3 years, I thought it'd only fair to give you some brief views that I formed over that 3-year period. First comment would be the extremely challenging conditions that the company has actually worked its way through. I'd have to observe that as a Board, we have seen our management team handle that in a very sure-footed manner, while producing reasonable returns, and while at the same time, conceiving and then beginning to implement the Gen35 strategy. And as you heard, we are now well down the track in doing that. I've observed our Board operating effectively, strong teamwork, strong focus on oversight of our management team and ultimately, a very diverse set of skill sets being brought to play.

So having said that, I'm absolutely delighted to offer myself for reelection to the Board. One matter that I would draw to your attention relative to my own CV is that over that 3-year period, I've accepted appointment as Chair of Bank of New Zealand and to the Board of National Australia Bank. That gives me very good insights into both the New Zealand and Australian economies. But it means that if you do see fit to reelect me, I will simply have the 3 appointments and I have sufficient time to devote to the business of each 1 of those entities. So I'm excited at the prospect of reelection, and I hope to leverage the experience over the past 3 years. Thank you very much.

Thanks, Warwick. Is there any discussion or questions in relation to Warwick's reelection? There appears to be no further discussion. So I now put to the vote the ordinary resolution that Warwick Hunt be reelected as a Director of the company. And I'll give you a moment to mark your voting form or vote online.

[Voting]

I'd like to propose resolution #3 that Hinerangi Raumati-Tu'ua be reelected as a Director of the company. The Board has confirmed that Hinerangi is standing as an independent director. The Board recommends Hinerangi to you as a Director of Genesis Energy Limited and unanimously supports her reelection. I now invite Hinerangi to say some words.

[Foreign Language] Greetings to you all. As Barbara said, my name is Hinerangi Raumati-Tu'ua, and I have served on the Board of Genesis now for 3 years. It has been both a challenging and dynamic period of time. It's been really pleasing to see how well we have been led by our Chair and to welcome our CEO, Malcolm John during that period. My reflections on this time have been that is that we are well served by the Board that we have, and we are well served by the management team that we have.

It has been a real pleasure to work beside an incredibly talented team. I bring to the Board over 20 years of governance and executive experience across a wide range of sectors and entities. Predominantly, my experience has been in the Maori and Iwi commercial post-settlement economy, having contributed to both the growth and long-term sustainability of this sector over many years. That experience is invaluable in terms of the contribution that I make to Genesis. I've also dedicated my time and my career to thinking about place of Maori ways of thinking and knowledge in the management and governance of commercial entities in order to create shareholder value for the long-term.

It's a privilege to serve on the Board of Genesis Energy and to advance the strategy of the company, and I look forward to your continued support. [Foreign Language]

Thank you, Hinerangi. Is there any discussion on this resolution? There appears to be no further discussion. I now put to the vote the ordinary resolution that Hinerangi Raumati-Tu'ua be reelected as a Director of the company. And again, I'll give you a moment to mark your voting form or vote via the portal.

[Voting]

Resolution 4 proposes that Tim Miles be reelected as a Director of the company. The Board has confirmed that Tim is standing as an independent director. The Board recommends Tim to you as a director of Genesis Energy Limited and unanimously supports his reelection. I'd now invite Tim to address the meeting.

Thank you, Barbara. [Foreign Language] Fellow shareholders, it's been my privilege to represent shareholders over the past 9 years as a Director, as Chair of the HR and Remuneration Committee and as a member of the Nominations Committee. I enjoy working with my colleagues and the members of the Genesis team. As you've heard, your company has significant aspiration in its goals, delivering for both a better Aotearoa New Zealand and to deliver the pillars that will underpin enhanced financial performance.

As you've also heard, much progress has been made, but we are far from the end of this journey. My background is in digital technology and customer-focused organization, and this leads me to have a special interest in these areas at Genesis. The Genesis team have a number of key technology projects in train and the successful delivery of these are crucial to the support of our strategy and ongoing future shareholder returns. I would be very grateful for your support in continuing this work on your behalf here. [Foreign Language]

Thanks very much, Tim. Is there any discussion on the reelection of Tim? There appears to be no further discussion. So I now put to the vote, the ordinary resolution that Tim Miles be reelected as a Director of the company. And again, we'll give you a moment to mark your voting form or vote online.

[Voting]

Resolution 5 proposes that David Baldwin, who is eligible for election, be elected as a Director of the company. The Board has confirmed that David is standing as an independent director. The Board recommends David to you as a Director of Genesis Energy Limited and unanimously supports his election. David?

[Foreign Language] It's a privilege to be a member of your Board. Thank you for considering my election to the Board of Genesis. Over the last 30-plus years, I've had the opportunity of working around the world in different organizations, including here in Aotearoa, New Zealand. I was the CEO of Contact Energy for 5 years. And after that, I was the CEO of integrated gas business of Origin Energy in Australia, where -- which included the construction and operations of a very large liquified natural gas project in Queensland. Among other things, including operating onshore and offshore gas fields, including the Kupe gas field that now Genesis is a partner in.

Prior to that, I was an engineer and an executive with Shell and Berkshire Hathaway Energy in different parts of the world. And I've had a wonderful opportunity to see how things operate in that respect and bring all of that international experience into Genesis. Most recently, I've been a Senior Managing Director with Macquarie Asset Management based in Singapore up until 2 months ago when I retired from Macquarie. I still serve as a director on 2 Macquarie portfolio companies, both renewable energy. And again, that brings the opportunity of importing and sharing that experience with how renewables are built out across Asia and in the United States into Genesis. I've had other nonexecutive roles across the region from Korea to Indonesia to the Philippines and Australia as well, including energy utilities, electricity distribution, hydrogen and so on.

So one thing that I'm particularly pleased to be able to bring to Genesis is my experience in driving a culture that supports good performance in health and safety. That's been largely due to the fact that I've been responsible for leading the construction and operations of complex projects, LNG projects, oil and gas, generation, electricity distribution and so on. So that aspect of my career so far has been very important to me. There was a time I was a Global Head of Safety for Macquarie Asset Management, leading safety globally across the 180 portfolio companies that Macquarie has invested in around the world. And so all of that with your support, I'd be very happy to stand for election and with your support, contribute to the Genesis Board. Thank you.

Thank you very much, David. Are there any questions or comments on the resolution?

We have 1 online question from Stephen Mayne. Could David or the Chair, please comment on the recruitment process that led to David's appointment to the Board? What role did the shareholding ministers play in that process? And did they vote in favor of the resolutions put forward to the meeting today?

I said in my speech that we used an external firm to get to arrive at David. It was a very thorough process. We were given quite a few opportunities to talk to other people. And we had a very clear matrix of the kind of candidate that we wanted on the Board. As I said, Paul Zealand had retired from the Board and Paul bought specific engineering and health and safety qualifications to the Board. And so we were largely looking at how do we replicate and enhance on that. So we went through a very thorough process looking onshore and offshore for the right people, and we landed on David, and I'm very pleased we did.

I'm not going to comment on the Crown's position. I will say that the Crown does not nominate people for these Boards. So that's left to us. We are a commercial entity. And so we do this ourselves. And I'm not going to comment on whether the Crown has otherwise supported. You will see that when the votes come through as we show you the voting from today's session. I think that's the best way to do it rather than show in advance.

Any other questions? Okay. I now put to the -- Oh, I'm so sorry, I missed you. I will just wait for a mic so that the online people can hear.

Thank you. David, you appear to have been on many Boards and companies around the world. Have you any idea of how long you would like or maybe stay with Genesis?

As long as you'll have me. It's -- so I'm on the 3 Boards, including Genesis. So I do have the time and capacity. And it's important for me that, that is -- I have the ability to give all of myself to a governance role as important as Genesis and any other good governance role would be. But no, I'm thoroughly committed. I've moved back to New Zealand. I'm delighted to be living here again and established and thrilled to be part of your company.

Are there any other questions around David's appointment election?

Two more have just come through online if you want to. David, how do you deal with resistance to change in culture. That's a question from Eva Quiding.

How do you deal with resistance to change in culture?

Well, so I've worked in many countries. I've lived in 8 countries for lengthy periods of time, most of which is across Asia, Indonesia, Philippines, Hong Kong. I've worked in all the countries in Asia, invested and be on the Boards of companies in China, Philippines all over the place. So one of the things I think New Zealanders that I found myself and other New Zealanders is that we're quite adaptable. And we accommodate the differences that exist across cultures and Asia has a vastly diverse set of cultures and make that work really well. And so I love difference. I run toward it, explore it, understand -- try to understand it as best as I could and work within that environment to make all the stakeholders who are part of that context, whether it's a business or a community successful.

There's 1 more question.

No, the rest of general business. I'll save them to offline.

Okay. Thanks very much. So I now put that David Baldwin be elected as a Director of the company. And again, I'll give you a moment to mark your voting papers or submit online.

[Voting]

So ladies and gentlemen, that concludes our discussion on the items of business. In a minute, I will close the voting system. Please ensure that you have cast your vote on all resolutions and I'll now pause for 20 seconds to allow you time to finalize those votes. I hope no one's been timing me. I think that was about 20 seconds. So the voting is now closed.

This slide, which is for your information, is a summary of the proxies received by the company before voting closed. Thank you all for casting your votes. Your votes will now be collected by Computershare and the full results of the voting will be announced to the market as soon as they are available. So there's -- so our colleagues from Computershare are walking around with a box. If you could put your voting forms in those boxes, please. Hand in the room, if you've not been picked up, thank you very much.

Thank you. Shareholders now have an opportunity to raise any items of general business that may lawfully be put to the meeting. Those online may use the Computershare site to do this, select the Q&A tab, type the item you wish to raise into the box and at the bottom of the screen, press submit. For those present, please raise your hands and a microphone will come around to you. I'll start in the room.

Are there any general questions from shareholders here today? Okay. Matthew, any online, please?

Yes, there's 1 online question. Eve Quiding is asking, does the company plan to lay off any staff in which -- in any department of the company in the name of cost saving?

You will have noted from -- as we went through last year, there was quite a bit of restructuring that went on in our retail division. And I have to say, all our staff across the company, all our leaders handled that incredibly well. That did lead to a reduction in FTE in some parts of the business. So some in retail, some in tech. We have no plans for large-scale layoffs. We -- obviously, like any company, we look at our workforce all the time and apply our resources to the right place at the right time. We've got very talented people. We've got very good ways of being able to train people internally and redeploy them into other places.

So we have no big large-scale retrenchment sitting on the horizon. We just manage -- we manage our workforce and our efficiency and effectiveness on a day-to-day basis every day. And I think the team are doing an excellent job in that.

Any other questions, Matthew?

There's 1 further question from Stephen Mayne regarding the proxy votes, he just asks how did the government vote their controlling stake? Do they vote it by proxy or were they in the poll today?

Matt, I think from memory, they handed the proxies to me, as Chair.

It was voted by proxy.

Yes. So I get to vote the government, the Crowns. So these people are in my hands at the moment. They don't look very terrified, do they. Any other questions?

Just to comment here from shareholder, Gordon Lareau to say thank you, David, for bringing experience and fresh ideas moving Genesis forward into the future and beyond.

Question in the room?

Yes, Andrew Hart. I'm just asking a very way out question. I've heard all the questions and the comments about the Huntly firming options and stuff like that. Do you ever see any option of shutting down Huntly and putting a nuclear power station in this place?

I remember when Jenny Shipley was the Chair of Genesis Energy and in her parting speech, Jenny said -- Dame Jenny said, look, she really felt that nuclear should be an option for New Zealand. Look, I think we are a long way away as a nation from even considering something like that. So like, I don't know, you never ever say never, but this country stands on nuclear positioning would not suggest that, that would be possible.

Malcolm, do you want to add anything?

No.

No. Thank you for the question. There's another question down the back and 1 over here on the side. We'll start down the back.

Good afternoon, and thanks for bringing the meeting to Christchurch. I just wondered, could you tell me what's the most cost efficient and profitable form of electricity generation?

Hydro water. Rain is free fuel as we like to describe it.

On that note then, the 3 hydro stations that Genesis have appear relatively old. How would you rate them in a seismic large earthquake?

We've spent quite a bit of time and money at Tekapo, which is the one that would be most prone to earthquakes given where it's located. And I think maybe Tracey helped me 3 years ago, 4 years ago. We put in a big -- what technically known as a plug. We put in a big plug, so that if there was an earthquake that stops the water from going down through our system into the lakes beyond. And so that effectively cushions the impact of an earthquake in that valley that the water goes down.

So we're very conscious of this. We get involved in thinking about seismic care around dams and all the dams around the hydro sites. It is not a set and forget process. So we are always mindful of those kinds of risk and the management team bring those risks to the Board.

On that note, then, with hydro is there any prospect of further hydro development?

Look, I think at a very large scale, it seems unlikely at the moment. There will be micro tweaks that make these systems more efficient as we go through in time. And we do that now. There's different ways that the team can manage to get these schemes running more efficiently and generating more power along the way. So I think it's more going to be how do we keep on tweaking the system to make hydro way more efficient and way more usable as we build out other renewables and then continue with the role of Huntly in firming and battery and those kinds of things.

There was a question over here. We'll just grab a microphone for you. Malcolm, jump in any time.

Malcolm, you mentioned in your presentation that most -- all of the coal that is coming -- will be used in Huntly will be sourced from overseas. Is there any movement towards sourcing that coal locally so that the dollars and employment, et cetera, could be retained in New Zealand?

So we just executed a deal with BT Mining to purchase 120,000 tonnes a year of New Zealand supplied coal. Up until this point, New Zealand has only been able to supply about 10,000 tonnes a year in the specifications that we need. The team has worked really hard to -- on those specifications to try and expand our opportunity domestically.

The reality is that Huntly was built for a very specific type of coal that was found in abundance just behind the current site. And that's largely been exhausted in terms of easy to access coal. And we have 2 mines in Indonesia at the moment that fit that specification. And what happens when you move out of specification is you end up having to burn a whole lot more coal for the same amount of energy. And so it's a price curve that you sit inside as well as a chemical curve inside the coal.

But rest assured that -- so for example, the West Coast coal here in the South Island is better suited to steelmaking than to producing electricity in Huntly. But rest assured that we purchase all the coal from New Zealand that we can.

There's another question down the back here, David.

[Foreign Language] You've commented on nuclear futures. Could you comment on waste-to-energy plants, which are very common overseas?

Yes. Very successful overseas. In fact, I've visited 1 in Denmark not too long ago. And these things are remarkable the way they use energy. I think the success in countries in Europe is the reticulation of the heat that can be used, and that's not something that we have in New Zealand. I think there is a bit of waste-to-energy going on. For example, Fletcher's are burning a lot of tires, old car tires to keep their Golden Bay furnace hot. So there's pieces like that going on around the country. But unless Malcolm knows more than me, there's no plan for any large-scale Denmark like facility here in New Zealand. There doesn't seem -- there's not the reticulation system to start with, but also there's actually to make these things work, you need a lot of waste. And the studies that have been done would suggest, we just don't have it at that scale here.

Look, technology changes, as you know, and that may change in the future. But right now, it's just not a viable thing, even though it's very attractive.

The more likely pathway is through a torrefied process where you take the waste and actually turn it into gas that you can use in gas turbines, but that is relatively expensive relative to other fuels that are available at the moment. However, but as Barbara said, as that technology rolls forward, you are coming down a technology curve. And so at some point in the future, that torrefaction pathway is probably more accessible to New Zealand than the Denmark-style example.

Any other questions? Any more online? No. Okay. Thanks, everybody.

Just to wrap up, this is my seventh year leading the Board as Chair. And I'd like to thank my colleagues on the Board for their support and the support and hard work of Malcolm and his executive team. I am proud to lead an organization committed to powering a sustainable and thriving Aotearoa. We've built strong foundations for future growth, and I look forward to continuing the good work for you, our shareholders, and for our customers and our wider stakeholders.

Thank you, everyone, for joining us here today. I'd like to invite those present to share some more refreshments, which I believe are outside and take the opportunity to interact with those of us who are here from the management team and Board. This concludes our 2025 Annual Shareholder Meeting. Thank you.

Thank you for standing by, and welcome to the Genesis Energy Full Year Results 2025 Analyst Briefing. [Operator Instructions] I would now like to hand the conference over to Mr. Malcolm Johns, Chief Executive. Please go ahead.

Welcome, everybody, and thank you for your time. It's a pleasure to be here today to walk you through our FY '25 results. My name is Malcolm Johns, Chief Executive, and I'm pleased to be joined today by Julie Amey, our CFO. Turning now to our first slide. Let me first recap our executive team and update you on some minor changes to our business unit structure as we accelerate strategy delivery.

Before I do, can I congratulate our team on receiving the electricity Retailer of the Year Award at the recent New Zealand Energy awards. Pleasingly, the judges noted the retail transformation, customer innovation and strong cost control demonstrated by Genesis. As we have mentioned before, the energy transition requires us to stay nimble and adapt as the market changes. As such, we have made minor adjustments to our executive accountabilities to accelerate strategy delivery and commercial outcomes across Genesis. Stephen England-Hall, having successfully driven our retail transformation, now leads our commercial business unit, focused on driving margin growth through the energy-only market. Tracey Hickman, having delivered both 2- and 10-year HFOs, continues to lead our operations and development business unit, focusing on development of new renewables, capacity products and Huntly firming options. HFOs are setting a pathway for us to leverage our high levels of dispatchable generation and stored energy.

Ed Hyde, who is successfully delivering our technology program continues to lead technology and transformation, but with added waiting on deploying data and AI to drive further improved productivity. Ed will now also lead group strategy and our LPG business, which we are moving into a new business unit. Julie Amey joined us as CFO in November 2024 and has immediately made a material impact, accelerating our powered finance transformation work program lifting risk and capital management and driving commercial performance across the business. Matthew Osborne continues to lead corporate services, navigating a busy policy and regulatory environment along with successfully completing the 10-year HFO agreements. Claire Walker continues to successfully lead our people, culture and safety functions, Claire has guided Genesis to excellent culture resilience and talent development during what has been a major period of structural change and commercial culture development, while also delivering safety outcome uplift across the business.

What is also important to note is the material capacity uplift across our senior leadership team, where we have invested heavily in developing our existing talent and move to bring in new talent to strengthen our bench across the business. Our executive team is delivering strategy, building uplifts in commercial culture and improved like-for-like EBITDAF outcomes.

Moving to our agenda today. We will cover FY '25 results, a brief strategy update, group and business unit performance before finishing with our outlook to FY '26 and then taking questions. Moving to our first slide. As many know, this past year was a story of 4 distinctly different quarters. It was a year of profound volatility with each quarter offering different challenges and opportunities. This environment demanded not just resilience but cultural agility to adapt and respond. Our highly flexible generation fleet, fuel -- flexible fuel options and strategy activations to date served us well. We delivered a reported normalized EBITDAF of $470 million and reported EBITDAF of $454 million after adjusting for nonroutine expenses incurred during the year, which Julie will touch on later.

This includes a net negative EBITDAF impact of $23 million from Methanex gas in quarter 1 as we outlined at our half year results. We continue to drive planned investment in our technology upgrades. These involve replatforming our billing and CRM systems, financial management system and core trading systems. These remain within the investment envelope and time lines indicated at Investor Day '23. We can clearly see the benefit from this investment flowing into current like-for-like EBITDAF and our FY '28 outlook.

At Investor Day 2023, we indicated we were targeting mid-$500 million for FY '28 EBITDAF. Today, we are updating this to mid- to upper $500 million. We have successfully completed 150 megawatts of 10-year HFOs, which will come into effect from January 1, 2026, subject to regulatory review. This brings total HFO capacity contracts to 235 megawatts, providing strong fixed annual premium income for Huntly Power Station regardless of hydro cycles.

Health and safety is a key focus for the Board and executive team. So it was pleasing to see the business achieved ISO 45001 accreditation this year and safety incidents declined across FY '25. We have continued to simplify our business through the rationalization of Frank and Ecotricity into Genesis, and we will see the operational benefits of this in the years to come. With the resilient earnings outcome from FY '25 and the outlook to earnings for FY '28, the Board has declared a dividend of $0.143 per share for FY '25 in line with expectations.

Moving to our next slide. Delivering our Gen35 shareholder proposition means focusing on earnings growth, earnings multiple growth and strong capital management. We are laser-focused on these 3 objectives. We are also conscious of maintaining our social license to operate. And this slide covers our 3 key pillars of performance. NPAT was $169 million, up 29% on the prior year off the back of how we leveraged our portfolio flexibility producing 30% more electricity than planned during winter '24, in addition to cost out and valuation changes. The modest improvement in debt leverage ratio to 2.6 from 2.7 demonstrates disciplined capital and cash flow management even as the company invested in growth initiatives.

Our stable Net Promoter Score was delivered during a challenging period in the industry and a time of great change across our business. It is also symbolic of the way we have supported our customers and protected them from last winter's wholesale electricity market challenges. This is how customers directly benefit from an integrated model. Employee engagement remains a key strength at 79%, which is notably above the 75% industry benchmark. This reflects a highly engaged workforce that is aligned to our mission and values even as we navigate transformation across the business and transition across the sector.

The launch of our Community Investment Framework sets a 10-year horizon designed to create real positive change for the people and places closest to our power schemes. We have lifted our investment to $5.6 million annually, doubling prior year investments and reflecting our commitment to partner for real long-term impact. Under our planet deliverables, we can see tangible progress in delivering new renewable generation, including new generation assets, new storage assets and new renewable PPAs. Winter 2024 proved that when it doesn't rain and the wind doesn't blow, New Zealand still relies on thermal generation, and our emissions profile will continue to be driven by this for a few years to come.

Moving to our next slide. If I can now move to how we have leveraged our competitive advantage in flexible assets and fuels to deliver our FY '25 gross margin outcomes. A notable aspect of this is how our teams have driven impressive gas flexibility across FY '25 by leveraging our overall fuel flexibility, taking advantage of multiple fuel markets and avoiding being a hostage to any one fuel type. Coal now influences the forward curve for marginal thermal fuel pricing more than gas does. And we believe the ASX forward curve has now reset to this change. Our asset and fuel flexibility has allowed us to move our generation mix across hydro, wind, solar, gas, coal and diesel to take the opportunities each quarter offered while managing our risks effectively.

The gas market is challenging and will remain so over the next few years. However, overall fuel portfolio will allow us to continue to take margin opportunity and manage risk as we have in FY '25. We intend to keep our portfolio structured to open our ability to leverage our flexibility for earnings growth and resilience over the long term. This graph also shows the generation profile from HFOs. Subject to regulatory review, this will grow from 2026 onwards.

Moving now to our next slide. Moving to our strategic positioning of Huntly. There is a difference between generation LCOE and system LCOE, which appears to be widely misunderstood in recent discourse on the electricity sector. Focusing solely on generation LCOE overlooks the real cost of energy security and the fact that one way or another, this has to be paid for by the system to be available. Our view is system LCOE is between $125 and $135 a megawatt real today or between $30 and $40 a megawatt above generation LCOE. This slide illustrates how we are transitioning Huntly from monetizing through just the energy-only market to greater income certainty through both the energy and capacity contract markets. We now have 235 megawatts of capacity contracts or HFOs in market, and we intend to expand the HFO product range over the next year or so, bringing more new products to market to produce energy security and price stability options for all market participants, gentailers, independent retailers, independent generators and industrials alike. However, energy security has a real cost and to deliver increased peaking and firming products to the market will require real cash investment.

Investment will only be made if the market settings are supportive and all market participants accept there is a real cost to secure the energy system. This graphic illustrates how existing versus future energy position under our current strategy will play out. On the left, we have FY '25 demand across our customer segments from residential and small businesses through to commercial and industrial, plus our new energy security capacity contracts, HFOs. In the middle, our current FY '25 supply mix shows our portfolio structure anchored by our hydro generation, complemented by renewables and flexed using our flexible generation and fuels. The key insight in the right column, our FY '28 targeted supply position. Here, we can see how we will monetize renewables and Flexgen through both the energy-only market and HFO capacity contracts.

Value growth in the energy transition is weighting more towards dispatchable generation and energy storage across minutes, hours, days, weeks and months. Huntly Power Station is the Swiss Army knife of firming in New Zealand, and we will be monetizing it across both the energy-only market and the emerging capacity contract market we have created with HFOs. Genesis has long-term competitive advantages in both dispatchable generation and energy storage, and this is where we will prioritize deploying our own capital. We will have more to say about this at our November Investor Day. Intermittent renewables are important to grow with the market, and we will deliver our new renewable supply through leveraging third-party capital and long-term PPA contracts.

Moving now to our 8 by 28, where we are on track to deliver mid- to upper $500 million EBITDAF by FY '28. This, of course, assumes P50 hydro, no major unplanned plant outages or unforeseen changes in our operating context. While we have made significant progress across all key deliverables in 8 by 28, including delivering our EV market share target and the majority of our pre-technology retail transition. However, I would like to comment specifically on our flexibility cog at the bottom of the slide.

Stage 1 BESS construction is now well underway, and we can update project CapEx to $135 million, a reduction from our initial indication of $150 million. This reflects the benefits of building on an established site with a resident, skilled and experienced workforce and a strong procurement function. We are now actively working on BESS Stage 2. Fuel flexibility is our overall strategic objective. Gas flexibility and gas storage are part of this overall objective, and we continue to explore gas flexibility options, including gas storage.

We continue to progress commercial discussions to establish an initial supply of biomass with multiple parties. We will have more to say about all of these and our objectives beyond FY '28 at our November Investor Day. Moving to our next slide, the customer business unit. Our teams are well into delivering our retail transformation strategy. Our objective remains margin growth by focusing on value over volume and our netback uplift, cost out and productivity improvements are current evidence of this being delivered. We continue to make progress on the billing and CRM replatforming and expect our first small customer cohort go-live trial to occur in quarter 2 FY '26.

Moving to our renewables cog. As mentioned above, we are prioritizing our own capital to dispatchable and storage assets, intending to deliver new renewables long term through directly leveraging third-party capital and indirectly through contracting value-accretive PPAs. FY '25 is a working example of this. Stage 1 BESS is being delivered on balance sheet. Lauriston solar farm was developed with third-party capital in a joint venture and Tauhara geothermal is a value-accretive PPA. The Board declared a dividend in line with expectations and our debt leverage ratio improved to 2.6. We do not plan to develop assets that aren't funded through one of these options. This approach is the foundation of how we will deliver yield plus growth outcomes for shareholders.

Looking forward, Edgecumbe FID is targeted for quarter 2 FY '26 and Leeston in late quarter 3 or early quarter 4 FY '26. Moving now to how we will transition baseload gas through building new renewables and leveraging our assets and fuel flexibility. We have previously indicated that we expect baseload gas generation to decline from 2 terawatt hours per annum in FY '24 to around 1 terawatt per annum by FY '28 and to be around 500 gigawatt hours by FY '30. FY '25 was 1.8 terawatt hours of baseload gas generation. We are assuming a base case gas scenario of Kupe Gas, noting we have 3.65 PJ contracted outside of Kupe for calendar year 2026. Renewables growth in this illustration will come from our planned solar developments and the Kaiwaikawe wind PPA. Beyond this, we will leverage our fuel flexibility as we have in FY '25 to position ourselves to take advantage of fuel market upside opportunities as they present while managing downside risks in our portfolio. In line with this, we will be maintaining an increased operational coal stockpile of between 350 to 500 kilotons out to at least FY '30.

This will take the total coal stockpile to between 950,000 tonnes and 1.1 million tonnes, 450 kilotons of this will exist and be funded by counterparties as part of the 10-year HFOs, which remains subject to regulatory review.

Can I now hand to Julie to talk through the performance in more detail. Julie?

[Foreign Language] Malcolm and [Foreign Language] to everyone listening in. It's certainly been quite a journey since I joined Genesis a few months ago with my initiation being during a very intense period for Genesis and actually for the whole sector. But it is great to have come through the year with such strong financial performance, which is a true testament to our business' navigation of a very challenging and volatile operating environment. I refer you to Slide 15 in the presentation. And as Malcolm mentioned earlier, we delivered a reported EBITDAF of $454 million and a reported net profit of $169 million, both financial outcomes being materially higher than the previous financial year. This performance becomes even more meaningful when we look through our financial results to a more like-for-like basis. This takes our EBITDAF up to around $488 million after we adjust for a few nonroutine expenses, as noted in the slide, and also adjusting for the significant but temporary ramp-up in our digital investment OpEx, well above our normal annualized levels of around $15 million.

This outcome has been delivered across a year that has seen 4 quite distinct quarters and demonstrated the flexibility and resilience of our operations and our people to respond to significant volatility. We capitalize on tailwinds and offset as many of the headwinds as we could in order to minimize the downside impact on our customers and on our bottom line. Other items of note from our group financial performance include a 21% increase in revenue, which reflects the higher electricity spot prices and also includes the uplift from the Ecotricity sales since our acquisition in November 2024. This revenue uplift also includes a 12% increase in transmission and distribution charges that we have passed through to our customers at a total cost of around $695 million for the 2025 financial year. Before I move to our group gross margin and operating costs, I want to call out that as Malcolm has mentioned, our board declared a final dividend, taking the full year dividend for 2025 to $0.143 per share in alignment with our dividend policy and reinforcing our commitment to balance our growth investment trajectory with yield returns for our shareholders.

So moving now to Slide 16 and our value drivers behind our group gross margin and OpEx performance. Of note for gross margin, we experienced a significant increase in fuel costs against the previous financial year, largely driven by the higher gas and coal costs experienced within a very constrained gas market, which, of course, was heightened by winter 2024, resulting in a net gross margin loss of around $59 million. This effectively represents the level of the impact that we were unable to fully mitigate during the winter period. However, you will note that across the financial year, we were able to flex our portfolio to optimize our long and short positions and deliver meaningful gross margin upside against the prior financial year. In addition, we realized more margin from higher netbacks across our retail segments, reflecting our ongoing focus on more valuable volumes. Importantly, these results also reflect our continued focus on investing in our assets to ensure they are available when needed. You will see more details of this later in the presentation.

Moving to operating costs. Around 40% of our total OpEx spend was on our baseline workforce. The increase from the previous financial year also reflects our acquisition of Ecotricity in November 2024, as I referred earlier. We are now in the process of fully integrating Ecotricity to ensure that the synergies we have identified are fully realized. On a like-for-like basis, we have a 7% reduction in our core FTEs, reflecting the transformation activity that has been underway across our business to streamline our operations for further efficiency. We delivered around $14 million of annualized cost takeout in the financial year 2025, and this is an area of continued focus for the business. Finally, an important callout is the ramp-up in our investment in digital projects that I mentioned earlier and that we initially spoke to you about at Investor Day 2023.

This investment is pivotal to realizing future value from critical technology, digital systems and solutions across Genesis and the investment will ramp up and continue to ramp up with a peak in financial year 2026 before reducing back to an annualized average baseline of around $15 million. And while you will see some of the spend in CapEx, the bulk of this spend is reflected in our OpEx as it is largely classified as Software-as-a-Service in compliance with IFRS accounting conventions. Moving across to capital management on Slide 17 and 18. We continue to focus on the financial strength of our balance sheet, our cash generation capabilities and the utilization of the self-help from our operations free cash flow, which you will see is directed towards our growth investments and our dividends. We are making good progress on our capital management strategy and firming up credible options for our capital planning in support of Gen35 and our many growth opportunities. And we look forward to sharing further details of this with you later in the year at our Investor Day 2025.

As you will see on Slide 17, we committed a significant amount of our free cash flow during the year to replenish our coal stockpile and secure a strong energy reserve. The new HFO contracts that we entered in July will now enable us to share the cost of the stockpile, moving around 600 kt to our reserve, of which 450 kt is for our HFO counterparties. Our stay-in business CapEx spend of around $86 million is slightly above the prior financial year and reflects some of the ramp-up in digital projects that I referred to earlier. From a debt and liquidity headroom and leverage perspective, we continue to manage our financial resilience closely with a strong focus on our balance sheet and, of course, ensuring we maintain our investment-grade credit rating, which pleasingly was reaffirmed by S&P at BBB+ in December 2024. I now want to speak about the performance of our businesses.

Our retail strategy activation continues to progress at pace with focus on radical simplification of our operating model and driving higher margins through the optimization of our portfolio and channels. As you saw on the previous gross margin slide, we delivered a $65 million margin uplift during the financial year, demonstrating growth across all of our segments from a focus on valuable volumes and achieving a 22% improvement in our netback per FTE metric. The team led through a number of cost takeout initiatives, delivering some $12 million of annualized savings, representing a sustained reduction in core retail OpEx. Our retail rooftop solar ICPs grew by around 68% during the financial year, reflecting our customers' increasing adoption of low-carbon technologies and the Genesis stronghold position as the largest distributed solar energy retailer in New Zealand.

We also prioritized gas supply to our existing home and business customers during the year, putting our own customer needs ahead of the new commercial and industrial customer acquisitions and a head of new network connections. We will only revisit this position when additional gas supply availability is certain. Our EV plan connections rose 39% year-on-year, and we continue to see growing demand for these plants as EV sales rebound. This EV plan growth complements and strengthens our decision to invest in public charging through ChargeNet and for Genesis to be the #1 provider of EV charging for customer journeys.

We are now well into the second stage of delivering our retail strategy, moving to a single brand, a simplified range of products and a single operating structure across Genesis, Frank and Ecotricity. This will deliver the next wave of uplifts from across netback, customers and productivity, which then leads to the third wave of our retail strategy, bringing the scale that is enabled by technology, data and AI, which will deliver further value from the strong foundation that our new retail billing and CRM platform will bring. Genesis is delivering on its strategy in retail, and our shareholders and customers are benefiting.

Moving now to our operations. We continue to see strong reliability from our generation assets with both hydro and thermal reaping the benefits of our continued and proactive investment in asset maintenance and asset life cycle management. With the exception of Rankine Unit 2, our hydro and thermal assets remained highly reliable during the financial year. Over the past few years, Unit 2 has only been invested in as a backup unit. And in late financial year 2024, it suffered a significant turbine failure. Our team were able to skillfully complete a complex and courageous transplant of the turbine from the decommissioned Unit 3. We highly commend this team for their vision, for their dedication and the overall success of this operation. This ensured that all 3 Rankine units were available and running 24/7 for several weeks during the back end of winter '24 when the market was in a very stressed state and clearly needed them. And likewise, with the significant gas constraints in Winter '24, the team also took the initiative to carry out minor modifications to Unit 6 to enable a rapid switch from gas to diesel, if required. And in fact, this has been required for several days during stressed market conditions.

In addition, we also undertook further investment in all of our rankings in advance of Winter '25 to ensure they were all available should the market require them. Once we have the regulatory approval to progress our new HFOs, we will be embarking on a significant program of work to prolong the life of all of our Huntly Rankines out to 2035. So overall, our operational CapEx spend during the financial year remained in line with our annualized average target of around $50 million to $60 million, which included several major hydro asset upgrades with more significant upgrades planned for the upcoming financial year, and we've included more details in the appendix. I also want to take this opportunity to make special mention of our fuels and operations teams who really did bear the brunt of the record dry period that was compounded this year by the gas supply slump. These people really did take one for the team. And most importantly, through all of this, they achieved a reduction in the number of safety incidents and a lower injury severity rate than in prior years. This is truly exceptional performance.

So before I hand back to Malcolm to speak to our outlook and guidance, I do want to call out our businesses and investments that are commercially significant and have a strong value proposition, even though they sit outside of our core electricity business. Our highly resilient LPG distribution business consistently delivers strong margins and the reduction in natural gas availability has positioned LPG as a credible transition energy source for the future. Our focus remains on continuing to drive margin growth from ongoing optimization across our key customer segments. And of significant importance is the close management of the risks that are inherent in this business. We have experienced an increase in recordable injuries and are now actively addressing this through process improvements, training and other safety message -- measures such as equipment upgrades.

Now moving on to the Kupe joint venture. Our equity share participation secures our access to Kupe's natural gas and LPG reserves, which also -- while also providing a consistent source of earnings that are underpinned by solid reliability and a credible safety record. The JV remains focused on optimizing late-life field performance and managing costs effectively to maximize value for all participants.

Turning to Slide 23. Our forestry investments will provide us with access to around 300,000 NZUs annually from 2030, providing us with a valuable future carbon cost hedge. And finally, I want to call out again our investment in ChargeNet as an enabler for Genesis to accelerate our customer electrification strategy with EVs being a key high-value customer segment for rapid growth and ensuring that Genesis is well positioned for the future.

So with that, I will now hand back to Malcolm to speak to our outlook and for his closing remarks.

Thank you, Julie. Looking ahead to FY '26, we have started the year with a strong July, driven mainly by North Island hydro conditions. As the table indicates, FY '26 will continue to see progress in uplifting like-for-like EBITDAF, which we expect to be in a range of $470 million to $510 million. Normalized EBITDAF is guided in a range of $430 million to $460 million. The difference is digital investment peaking in FY '26 as outlined at Investor Day '23. We have also provided $22 million for increased fuel and carbon costs driven by lower opening lake levels in the South Island and Genesis' weighted average carbon cost. To summarize where we're at in our strategy delivery, we remain on track for yield plus growth investor propositions, delivering both consistent returns and sustainable long-term growth for our shareholders. We are progressing our capital management strategy and remain focused on strong capital management. We are demonstrably delivering strategy across BAU and our 8 by 28, and we can see the underlying uplift in like-for-like EBITDAF that is emerging.

FY '26 will see digital technology investment peak before declining back to stay in business levels, and we can see the benefits from this flowing into future earnings. We can also see a pathway to mid- to upper $500 million EBITDAF by FY '28 based on P50 hydro, subject to no major unplanned plant outages or material changes in our operating context. We look forward to hosting you at our Investor Day in Taupo on the 26th and 27th of November to set out this in more detail.

Thank you for your time today. We will now move to questions.

[Operator Instructions] And our first question comes from Grant Swanepoel with Jarden.

So my one question is one of many, many parts. It's on your guidance. So digital spend that you guys have put together, the extra $60 million for this year. When you add up the last 3 years, it comes to about $123 million, including this year. While your guidance in FY '23 for these 3 years was only $105 million. What has occurred in these costs and why the pickup is so materially.

So thanks for that, Grant. So the digital spend that we're referring to is that $146 million that we mentioned at Investor Day, that envelope for those 3 or 4 big rock projects. So we are within that envelope and our spend. The uplift isn't $55 million to $65 million. That's a total spend because we spent around $33 million in financial year '25. So the uplift is around $30 million on that. So we are tracking to that. We're just peaking in '26 at the moment, and then we go back down to our normal average spend of around $15 million.

So you can see it more as phasing grant rather than any movement in overall spend. We just got more in FY '26 than we outlined at Investor Day '23.

Our next question comes from Andrew Harvey-Green with Forsyth Barr.

My question, I just want to focus a little bit on the FY '28 targets and the increases that you've signaled there. Can you just give us a sense of what your base is -- I'm sorry, just getting to the page, Page 10. So you've got, I think, in the 3 buckets, $105 million to $160 million. Is that increasing on the FY '25 year? And I guess, how much of those COGS have you actually delivered so far and how much is still to go?

So the base year hasn't changed, Andrew. The base year is as we outlined in Investor Day '23, and neither have the totals. So at a like-for-like EBITDAF of around $500 million, you can say that we've delivered about 50% of that at the moment, and we can see a clear pathway to mid- to upper $500 million now, particularly once the technology projects have rolled through.

And I think I can add to that as well, Andrew. The challenge with this slide a little bit is that those are the 8 by 28 initiatives. Of course, there are initiatives outside of this slide as well, which are in our baseline, which is around our portfolio, which is also contributing to the EBITDAF target that we have as well. So it's not a straight mathematical calculation across there.

So what we plan to do at Investor Day this year, Andrew, is to rebase the next couple of years to make it clearer and to bring in those non 8 by 28 initiatives as well.

[Operator Instructions] We'll go next to Joshua Dale with Craigs Investment Partners.

Just on the move from going -- guiding to mid-$500 million to upper or mid- to upper $500 million, was the sole driver of that the 10-year HFOs being signed? Or were there other movements around that?

That was a contributor, but not the sole driver. So strategy delivery, we -- if you look at the 8 by 28 page, we always set down a range, and we're tracking on the mid- to upper end of those ranges, plus we've got other factors in play like the HFOs that are now coming into the mix, which weren't in the mix when we gave our initial outlook in Investor Day '23.

We go next to Vignesh Nair with UBS.

Just I suppose following on from the previous questions on OpEx. Post FY '26, which you've highlighted as a peak, I suppose can you just provide a bit of color on what the normalized level of OpEx will be in the business post FY '27. And I suppose maybe you can talk a little bit about what success actually looks like post all this digitization spend in that line.

Yes, sure. So as per Investor Day '23, we've got a target of $360 million core OpEx by FY '28. Noting that, that was pre the acquisition of Ecotricity and bringing Ecotricity in. That won't have a material impact on that $360 million, but we will update that at Investor Day with more accuracy, but it's probably more in the range now of $360 million to $370 million is where that target is sitting. Now in terms of the benefits of the digital transformation work that's being done, that's in the order of $38 million per annum once those are fully completed. And so by the time that's completed, by the time we're at $38 million of benefit, that will be around FY '30. But you'll see the benefits start to come in and ramp up from FY '28 onwards.

Moving on next to Stephen Hudson with Macquarie.

Just the wording around your final dividend seem to suggest that you're happy with the dividend policy that you have in place, whereas I think at the interim, you were sort of saying that the capital review would include a review of the dividend policy. Can you just clarify what is inbounds and out of bounds for the November Investor Day, what we should expect to hear on dividend policy?

Yes. Thanks for that, Stephen. So 2 things. We are certainly committed to the dividend and growing the dividend. So I think that's a given, and that is reflected in the dividend decisions the Board is making. The capital management strategy that is looking holistically at our options for being able to optimize across both yield and growth. That will, of course, consider what that dividend looks like and the trajectory around that and then the right policy around enabling that. But the dividend commitment is definitely there.

There are no further questions at this time. I'll now hand it back to Mr. Johns for closing remarks.

Thank you very much, everyone, for listening. I look forward to speaking more in the coming weeks and also updating everybody further at our Investor Day in November. Thank you. Thank you.

That does conclude our conference for today. Thank you for participating. You may now disconnect.