ACCENT GROUP LIMITED — Call Transcript 2025

Thank you, Chiara. Good morning, everyone, and thank you for taking the time to attend the call today. We will now take you through the results for the full year ended June 29, 2025, and a trading update for the first seven weeks of the H1 FY 2026 year. There will be an opportunity to ask some questions at the end. Accent, again, delivered sales, growth, and profitability in the FY 2025 year. I'm pleased with the Accent team's ongoing focus on our customers, product innovation, and high standards of retail execution online and in stores. We continue to make progress against our strategic objectives. If I can now refer you to the operational highlights on page four of our investor presentation, which was released to the ASX this morning. The key highlights include the opening of 54 new stores, bringing the total number of stores to 903, inclusive of our online websites. Vertical owned brands and product sales have grown to more than AUS 130 million, a mix of around 9% of our total sales. New distribution agreements signed with Lacoste and Dickies, with Merrell and Timberland agreements also renewed for further terms. Our long-term Skechers distribution agreement was extended to a 10-year term out to 2035. Skechers is our most important distribution agreement, where we currently have more than 200 stores and a large online and wholesale business. In April, the company signed a long-term strategic partnership with Frasers Group to bring Sports Direct stores to the ANZ retail market. I'm pleased to report that the Sports Direct rollout is on track with our first store due to open in Melbourne in November. I will now hand you over to Matthew Durbin to talk through the details of the result. Thanks, Daniel. Turning on to page five, total sales for the year, including to franchisees, were AUS 1.6 billion. EBIT of AUS 110 million was in line with prior year and at the upper end of the guidance of AUS 108 million-AUS 111 million provided in the June trading update. Inventory levels were in line with plan, with aged levels clean. The year-on-year increase in inventory reflects the timing of stock in transit, converting The Athlete’s Foot franchise stores and inventory acquired in conjunction with the Frasers transaction, along with opening inventory for Lacoste and Dickies. In terms of the summary of financial performance on slide six, gross margin was down 85 basis points to 54.9%, reflecting the more promotional consumer environment and in half to the impact of lower sales and disciplined approach taken to managing inventory. Cost of doing business of 46.6%, including list appreciation and interest, was an increase on prior year, arising from low LFL sales in half two and continuing inflationary pressure in store team wages and annualizing rent reviews. Net profit after tax was AUS 57.7 million. Coming on to retail and wholesale on slide eight, owned retail sales grew by 2.5% to AUS 1.3 billion. During the year, 54 new stores were open. New store performance remained strong, with sales and return metrics in line with expectations. Of the 57 stores closed or divested, 39 of these related to divestments and discontinued brands, with a further 18 stores closed where sustainable renewal terms could not be agreed. Wholesale sales of AUS 155 million reflected the challenging macro and consumer conditions in the broader lifestyle footwear market. Sales of vertical owned brands and products grew to nearly AUS 130 million, continuing to improve underlying gross margins. The key contributors to the growth were Nude Lucy, Nils, Stylerunner, and Ode. Turning to the growth plan on pages nine and ten, the company continues to have a strong pipeline of growth opportunities. The Sports Direct rollout is on track, with the first Australian Sports Direct store planned to open in Melbourne in November. At least four stores, including online, are planned in FY 2026. At least 50 Sports Direct stores are planned over the next six years. The Lacoste and Dickies distribution agreements both commenced on the 1st of July, with sales starting to grow in FY 2026. There are further store rollout opportunities across the portfolio, with at least 30 stores, excluding Sports Direct, planned to open in FY 2026, including more new stores in Skechers, Nude Lucy, Hoka, Stylerunner, and others. The all-important Skechers distribution agreement has been extended to a 10-year term out till 2035, reinforcing the position that Accent Group Ltd holds as the distribution partner of choice for global brands in the ANZ retail market. The Athlete’s Foot franchise reacquisition program remains on track. On an annualized basis, the 15 The Athlete’s Foot stores reacquired in FY 2025 generated around AUS 43 million of sales, all strongly profitable. A further 13 reacquisitions are planned in FY 2026. Turning to dividends and the trading update, the company has announced a fully franked dividend of AUS 0.015 per share, bringing total dividends for the year to AUS 0.07 per share. The full year dividends represent a payout ratio of around 70% of earnings per share for the year. Total owned sales for the first seven weeks of FY 2026 are up 2% to last year. Like-for-like retail sales for the first seven weeks are up 0.8%. For the year, the company is targeting low single-digit EBIT growth in FY 2026. This is inclusive of the startup costs expected to be associated with Sports Direct. The outlook for half one FY 2026 EBIT is for a similar level of EBIT to half one FY 2025, with growth in half two FY 2026. This target is based on achieving low single-digit like-for-like sales growth, growth from new and annualizing stores, incremental profit from The Athlete’s Foot franchise reacquisition program, new distributed brands, and continued growth in Hoka and Nude Lucy. Gross margin percentage and cost of doing business percentage are planned to be broadly flat to FY 2025. The projection includes the impact of startup costs for Sports Direct. Now back to Daniel to wrap up. Thanks, Matt. We are pleased with trading the opening weeks of FY 2026. In particular, there are returns of positive like-for-like retail sales growth. Wholesale sales have traded in line with prior year, with strong forward wholesale orders. We're very pleased with what's happening in wholesale. The Accent team is focused on executing our plan for FY 2026, including innovative new product, new stores, launching Sports Direct, growth from our existing and new distributed brands, and a continued drive on cost efficiency, underlining gross margin improvement. The Sports Direct rollout, in particular, is a major growth opportunity for our company over the coming years. Finally, I would also like to take this opportunity to personally acknowledge and thank our Chairman, David Gordon, for his support, leadership, and stewardship of the company over the past 19 years. David has announced his intention to retire at the company's AGM in November, and we wish him all the very best for the future. That concludes our presentation today, and we would be happy to take any questions. Thank you. Thank you. We will now begin the Q&A session. As a reminder, if you would like to ask a question, please select the raised hand button to be placed in the virtual queue. Our first question comes from Garth. Garth, please go ahead and unmute yourself to ask your question. Good day. Can you guys hear me? We can. Thanks, Garth. Terrific. Good day. Congratulations on the result. Thanks for taking my questions. Just on the trading updates, could you just sort of break down the difference in the lifestyle and performance of lifestyle and the performance of your performance banners? Just that the performance had previously been quite strong, and I just wanted to assess whether that was still a lifestyle that was dragging that down. Yeah, Garth, thematically, that trend continues. You know the banners like The Athlete’s Foot, Hoka, and Merrell, this is a trend we've talked about now for at least 12 months, continue to perform strongly. The more lifestyle-oriented banners are definitely softer in terms of the growth, albeit, as we called out, what we're starting to see is a strong forward pipeline of wholesale orders, which gives us confidence as a forward read that some strength might be returning in that part of the business. Okay, great. Thanks. Just on that, I think the inventory growth was well above the revenue growth. How confident are you that you're not going to have to discount with that stock that you've got? I know you mentioned it was clean, but is that just related to the new store openings, or is there something that we need to just be conscious of there? No, there's no issues in terms of the composition of our inventory or the levels. That's why we specifically called out the sort of year-on-year, I'm going to say, one-off impacts, which is new inventory that's coming in for The Athlete’s Foot franchise stores that have converted. We've got opening inventory levels from Lacoste and Dickies, which will translate into sales. You know we haven't made much of a deal about it. We acquired quite a bit of inventory, which you can see in our combinations note there as part of the Frasers deal, part of which will be inventory for wholesale and part for Sports Direct. All right, terrific. Maybe one more if I can. Just theft has been an issue with one of your peers that was called out yesterday. Are you seeing similar levels, and have you sort of had to factor in any measures to protect staff and stock? are two aspects to that, Garth. I might just talk to the financials around shrink and then Daniel can talk to the team. It's a bit easier for us, I think, than others. We're very diligent on it. You know, when you've got one shoe out on the wall, we're a little bit more protected in the way our business model works. We're not seeing any dramatic increases in shrinkage, to be honest, in our business. Terrific. Thank you. On the people side, Garth, absolutely. We're spending a lot of time making sure that our team is safe. We're doing all we can to advise the shopping centers, in the main, the landlords, that more has to be done in this space. Hopefully, it all goes away for everyone. Certainly, there's been a little bit of a spike, but we've not had incidents that we've heard that others have had to date. Hopefully, we won't. Sure. I guess that just means that you wouldn't be able to reduce the number of staff in store just from a safety aspect. That probably gives you a little bit less flex on wage costs looking forward. I think so. We very rarely have any store with just, you know, a single person in store at any rate. Yes, I mean, so far, it has not affected our rostering methodology to this point. Terrific. Thank you very much. Thanks, Garth. Thank you. Our next question comes from Jamie. Jamie, please go ahead and unmute yourself to ask your question. Thank you. Good morning, Matt and Dan. Congratulations on some of the announcements today. Good to see. Maybe starting off with the outlook, just to add on to the previous question as well, considering the a bit more than usual skew in FY 2025, could you talk to sort of, you know, when you earlier said first half to be a bit consistent and then second half growth, could you elaborate here? Thank you for EBIT. Yeah, look, there's not much more to say, Jamie. I think, if we look at a, I'm going to say, a normal split of first half, second half profit, and we have a look at what happened in the second half last year, and I'm going to say project through based on the comp sales that we're expecting in the first half and margin and cost of doing business, that growth in the first half on the first half last year, which was actually pretty solid, particularly in hindsight, we think will be challenging. We're just trying to set expectations. First half this year, we're expecting to be flat, and that's what we're targeting. Growth in the second half last year, sorry, the second half of this year against what was, frankly, a disappointing second half. Also, Jamie, I can add that, as I said, we're quite pleased with what we're seeing with forward orders on wholesale. It's been quite positive. Hopefully, that'll hold up, obviously led with Skechers and Hoka being our two biggest brands. That's really a good sign for us. Great. Just on that lifestyle, obviously, macro would be a bigger beneficiary there than the sports brands. How do you feel about the outlook through the next few months or even a bit longer term? Look, I think it all comes down to, you know, what's the economy doing and so on. There's good momentum. Certainly, we've seen good momentum. One of our strongest banners at the moment, Jamie, is Platypus. In the past seven weeks, we're very pleased with that. Our Hype business continues to hold, which is great. Where we are facing some challenges is with Vans, which we've called out over the last couple of years. It's been very soft. Thankfully, the new products that have come in, like Hoka and so on, have been really, really, really positive. Perfect. Thanks for that. Secondly, from me, looking at the new store number for FY 2026 out of Sports Direct, at least 30. What are you prioritizing here outside that key banner, outside the key Sports Direct banner? I think there's still great growth in larger Skechers stores. Where we've tried a couple, they've been solid. Given what's going on with anything sport, and we're very happy with what's going on in The Athlete’s Foot, we will look to convert some of our current biggest stores into The Athlete’s Foot and indeed look for new ones based on what we're seeing. I guess that's where the growth will be. By the time you get four or five Stylerunners, four or five Nude Lucys, there's 10 stores right there. I think it's going to get down to, Jamie, we're driving pretty hard negotiations with our landlords that if we can't get the right metrics, we simply won't do it. We're in no rush to just be out on a mad run to open more stores. They have to hit the metrics. There's great opportunity. On top of that, we've opened a couple of Hoka stores in the last couple of weeks. One we opened yesterday, and we're seeing pretty strong results out of those stores. There's a pipeline of stuff that we can do there. Also, I can add that we're in the market at the moment looking for Lacoste stores. By the time you add all of those up, we should easily achieve what our aspirations are in new store openings. Perfect. Thanks, Dan. Thanks, Matt. I'll jump back in the queue. Thanks, Jamie. Thank you. Our next question comes from Sam. Sam, please go ahead and unmute yourself to ask your question. Oh, hi, Daniel. Hi, Matt. Just on the guidance, just to be firm. It sounds like in the region of AUS 118 million-AUS 120 million of EBIT on the AUS 110 million is what you're thinking as high single digit, just given there was a one-off on the AUS 110 million. We're all on the same page. Yep. That's a fair assumption, Sam, given the projection there for high single digit growth into FY 2026. Yep. Mathematically, 118 is high single digit growth. Can you sort of give further color on the startup costs, what that includes, marketing, team, and other components, and any numbers around that just to help us understand what that is within that guidance? Thank you. Yeah, no problem, Sam. Look, I won't provide any numbers. However, the types of costs that are incurred ahead of the curve are clearly standing up a team to get the stores launched. There's buying teams, there's planning that needs to be done, there's store operations, backend warehouse operations. There's quite a bit of investment that goes into that. Some of it CapEx, some of it OpEx. Marketing is also a big cost when you're trying to establish a brand. In terms of the, I'm going to say, the ahead of the curve components, those are the two you're dealing with. If we're aiming to open 30 stores over the next sort of three years, you can imagine that marketing is insignificant in terms of what we're thinking about over that period of time. When will that marketing start before the first launch, or will you wait till you get a few stores under your belt? Concurrently, it'll start with the first launch, but the investment around that first launch will be localized, very focused on that store opening and then digital. We expect the online site will open at around the same time, if not a bit earlier than the store. Performance marketing, other digital marketing, and then as the network starts to grow, we'd expect that that marketing will be more broad-based. Just encouraging that you've locked in all your called out four stores and at least four stores. It sounds like securing site so far is, you know, you've got a good line of sight there. Yeah, Sam, I've been quite surprised. It's amazing when there's no space, but then you get a hot business coming to the market, they tend to find the space. Yes, we've got many we're negotiating on at the moment, but we're really, we're being very picky, to be honest, where we'd like to open. Of course, we need the metrics to match. At the end of the day, the consumer's going to vote. I think what we've put together and what we're seeing coming from the Frasers Group internationally, we're excited about getting this one open. Final question from me, just on the, it's encouraging to see lifestyle improve. Can you talk about whether that's product-driven, macro-driven, execution-driven, or a combination? I think it's a combination, Sam. There's definitely more momentum. We felt it coming for the past six or seven weeks. Our comps have improved, and there has been a little bit more of product innovation. We're fairly confident of what we've seen in the forward pipeline from all of our brands that there's good innovation coming, albeit a lot of it is sport-inspired and that's sort of what the market's wanting at the moment. That's starting to bleed into the lifestyle space, which is good news. Part of the great results coming out of Hype is purely chasing that trend, and the likes of Platypus and so on are very close behind that now, growing in that area fast. Thank you. Thank you very much, Sam. Our next question comes from Ed. Ed, please go ahead and unmute yourself to ask your question. Hey, Tim, can you hear me okay? One more time. Yep, thanks, Ed. Hi, thanks for taking the question. It was good to see the EBIT coming in at the top end of the guidance range. I was just curious, given that you provided that in June, did anything change through June? Was there any improvement in the macro environment? Have you seen any improvement in the gross margin environment, or is it too early to say yet? A couple of comments around June. You can deduct fairly easily looking at our trading update in June and then the final comp number for the second half that the last three weeks of June were very challenging. That's like a little bit of a trend of what we're seeing in that lifestyle period. When we go on sale, we're not getting the uplifts that we have seen in the past year or two. That certainly happened. We'd seen that trend and factored that in. Part of the reason I'm going to say that that guidance range was a surprise to everyone at the time was there was a projection in that that ended up coming true. We didn't see anything we didn't expect, I'm going to say, in that last three weeks of June, which is why we were able to hit the top end of guidance. Look, I'm very reluctant to call out margin at the moment. We've said that we expect it to be around the same level as last year. As we sit here right now, I'm very confident of that projection, but we're only seven weeks in. Okay, no, that's helpful. You've also talked to like-for-like retail sales retaining growth in FY 2026. Just talk through what you think drives that. Is it more full price sales, more foot traffic? Which way should we be thinking there? I know you're kind of careful to say pull out margin now, but yeah, what's implicit in that? I think there's a couple of things going on in the macro. I think certainly interest rates are going to start to help us. In the back end of last year, in particular, we were cycling some pretty strong comps in Skechers from the prior year. That's now out of the base, so that's positive. We're starting to see, as Daniel said, some positive momentum in Platypus. There's a few things pointing to that lifestyle side of the business starting to recover. Certainly the forward wholesale pipeline being strong, we feel gives us a forward read. It's as strong as we've seen it for 18 months. That's probably, that's reflective of how others are sort of thinking about the next 6-9 months as well. The other thing that we've been experiencing, which is great news for us in the industry, is the average transaction has gone up in many of our banners, particularly in the Hype and Stylerunner business. That's really positive for us. A lot of the reason for that is because some of the shoes and the styles that are coming in have got some performance within them. That obviously causes an extra cost and price, but there hasn't been the resistance that I thought we may get, particularly in the last, you know, call it a couple of months. That hopefully will lead to an easier manner to chase the comps. All right, thanks for the color. Maybe just one last one from me, and apologies if you've addressed this somewhere in the materials already, just on your new comments, the FX rate that you seem to hedge for for 2026, is there any quality you can provide there? If you go to the chart that we provided in the back end of the slide pack, you can see that for the FY 2025 year, we actualized at around that 66, 65 level. Everyone could observe as well as I can that over the last six months, the dollar's been bouncing around between 63-65. You can imagine that any hedging that we've done would be at around those levels. Right now, if we're buying spot, we're buying it around those levels as well. As we come into this year, it's fair to say that currency will be a headwind year on year. When we talk about maintaining the percentage margin, what's feeding into that is we are hopeful at this point that the promotional environment won't be as severe as it was last year with interest rate cuts and hopefully the household budgets starting to feel a bit better. At the same time, we talked about, Daniel talked there about ATVs increasing, so some price increases. The other element is we're continuing to get benefits under the covers from the work that we're doing around vertical and distributed. As Hoka grows, Skechers returns to growth this year, and with some other distributed brands coming in and the strength of Nude Lucy, that helps the underlying margin in the mix. All right, thanks, Matt. Yep. Thank you. Our next question comes from Sean. Sean, please go ahead and unmute yourself to ask your question. Great. Good morning. Can you hear me? Thanks, Sean. Fantastic. Thank you. Maybe just to clarify the first half 2026 guidance to be in line with first half 2025. I think this might have been addressed, but just to make it really clear, your first half 2025 was AUS 80.653 million. That included a AUS 9.7 million gain on a reversible impairment, a AUS 3.8 million impairment, and a AUS 2.6 million one-off. What is the dollar base that we should be looking for, please? Maybe you could just, it's a busy morning, so there's a good chance that I and others may, but certainly me, will get this wrong. That's a good question, Sean. When we talk about our results, we don't sort of talk in relation to underlying. It's just too complicated for everyone. When we talk about flat, I'm talking about an ambition to be flat to the dollars that were delivered or the result that was delivered. You could say that there's a small amount of underlying growth in that, but to not confuse everyone, it's the AUS 80 million. When we say that's there or thereabouts what we're targeting, that's the number. Perfect. No, thank you for the clarity. Maybe just on cost of doing business reductions, the company had embarked on several sort of quite effective reductions in cost of doing business above the store level. I'm just curious around the degree of cost savings that had been possibly realized. Maybe they needed to be reinvested in fiscal 2025 and the degree to which any may come through in fiscal 2026, please. We continue to drive cost efficiencies in a number of areas of our business. Through the period this year, we were cycling through the benefits of a support office headcount reduction, and we will get some benefits of that indeed. In the core business in the first quarter of this year, offsetting that is that we've got startup costs associated with Sports Direct that are coming into the first half. The program continues to try to drive costs and aim to drive costs, and we're having success in distribution costs, in marketing costs, in particular digital marketing costs, the amount we spend with Google and TikTok and so forth. As we have improved our own channel data analytics, that's helping us target the 10 million customers that we have in our database. There is a constant battle at lease renewal that goes on to make sure that our occupancy costs remain in line as a percent to sales. You will see in the result there was deleverage in that in the second half. As I've maintained, if we're not achieving low single-digit like-for-like retail sales growth where you have 3%-4% inflationary factors, it's quite difficult to drive leverage on that. If you think about our cost of doing business and the statement that we are aiming to have cost of doing business broadly in line as a percentage with FY 2025, as we go into FY 2026, there continues to be a lot of work that has to be done under the covers to achieve that, albeit some of the inflationary pressures are starting to moderate a little. Having said that, it's a fact that the frontline team costs are going to go up at 3%-3.5% again this year. You need a couple of percent of comp sales, otherwise you have to take team off the floor. As we heard from an earlier question, we're not in the business of taking team off the floor for safety, but as much as anything for customer execution and good store execution. Great. My final question is just on Sports Direct. Can I ask how you balance the requirement, and then maybe if you could amplify the requirement for Sports Direct for you to sort of sell brands that, be it sort of Slazenger, Everlast, Lonsdale, which have sort of more of a mixed reputation in this market? How do you manage the requirement to sell those brands with selling the leading brands and particularly doing the right thing by your own distributors in terms of sort of Deckers for the Hoka brand, which has been very well, in terms of the distribution's been very judiciously managed in the appropriate sort of channels? I'm just curious how you sort of manage those different requirements and how you put that into a store where you're making each of those different parties happy and having an attractive offer for the consumer. I'm just curious if you could talk a bit about that predicament that you face merchandising the store, please. I might have the first go at that. I think the best thing to do is to sort of reference the Sports Direct global model. They're very much about premium branded and value. What you will find in a Sports Direct store is you'll find a terrifically branded Nike concept footy area, which is going to have the best Nike boot on the wall. We will have that in Sports Direct. For the parent that comes in and then wants a kid's boot, we will have a very keenly priced Sondico footy boot, which is a brand that we're going to make great margin on, and the customer will see the value. That's the global model, Sean. I don't want to say too much more other than we're going to execute what Sports Direct do and what the brands around the world appreciate them doing. I think it's a good question too. Obviously, that was one we looked at before doing anything. The support from all the brands, including the distributed brands that we distribute, has been nothing short of great. From our own point of view, the brands that we sell, the buyers will simply go and buy it based on the merit of the product. All of our brands that should be in a sport store will be in the store and very strongly represented. Fantastic. Thanks so much, Matt. Thanks, Daniel. Yep, thanks, Sean. Thank you. Our next question comes from Sam. Sam, please go ahead and unmute yourself to ask your question. Thank you very much. Hi, Daniel. Hi, Matt. Thanks for the presentation this morning. This is probably one of the softest periods I've seen Accent go through for some time outside of COVID. To your credit, you've managed costs very, very well in this period. My sense is a lot of people have left the business recently. From all the broader cost-out initiatives undertaken, what's the risk here that when conditions rebound in the lifestyle footwear space, you won't have enough people to see the leverage and execute on the way back up? Will you end up having to put back in a lot of the costs that you've taken out in recent times? Sam, that's a great question. There are a couple of aspects to that question. If I think about the customer-facing aspects of our business and the engine that drives what we do with customers, both being retail customers and wholesale customers every day, that's not the areas that we've pulled back. In fact, our team levels in store, store managers, assistant store managers, area managers, we haven't touched those ranks at all. What we've aimed to do is look at support office functions predominantly, where we've been able to put in more efficiency initiatives. We've been doing offshoring as well into Vietnam and, in fact, more recently into Manila in the Philippines. We're finding great cost efficiencies in, I'm going to say, support office team doing repetitive type tasks, data-driven tasks, and we've found some great savings through that area. I don't think we'd feel uncomfortable that where like-for-like retail sales go, there should be good leverage on that for us. Okay. Yeah. Sam, I can only add that I don't think the exercise was simply just to take people out. It was more of an exercise to say, what do we look like if we start thinking about right-sizing the business from a people point of view? I think we're largely there, and I think particularly my management team, we're in a great place. I don't think that that certainly won't be an excuse if we can't execute. It won't be from lack of people. Sure. Can we explore the theft issue a bit more? How's this Victorian crime situation impacting your thinking around how many Sports Direct stores you want in Victoria or the rents you can afford to pay in Victoria unless the police and courts start to clamp down on this issue, given the types of products in a Sports Direct will be much more susceptible to theft than your pure play footwear banners? Daniel, maybe it'd be good to get your thoughts on, do you think the retail industry is doing enough effective lobbying of government to take this issue more seriously? I don't think we've done enough as an industry, no. I think we need to do more. It's all over the news. It's all over the social media. There's, without any doubt, issues, particularly in Victoria. I hope the people that are qualified will do something about it. Like all the other retailers out there, the likes of JD Sports, Anaconda, and so on, we will simply follow the model of what Sports Direct are doing internationally. On the main days, I dare say we may end up employing a security guard, a security at the front of stores. That seems to be a model worldwide for these big stores. It's an area that we're going to learn and fall in line with. However, a lot of the stores, the way they've been designed, we will have team placed at the front of the store as well, proper rostered teams. Again, it's nothing new for us. It's where we're taking lead here from Sports Direct International. Got it. All right. Thank you. Thanks, Tim. Thank you. Our next question comes from Wei Wang. Wei Wang, please unmute yourself to ask your question. Thanks, guys. Apologies if this has been asked before. On your guidance assumption of flat gross margins, what have you assumed regarding promotional activity in FY 2026? Is it flat because you're comping an equally promotional FY 2025, or are you assuming in flat guidance that FY 2026 will be less promotional? Look, it's impossible to know, but broadly flat. We think we might get some benefits in some periods in respect to margin against last year, but broadly flat. I'll tell you in January. Okay. With the Sports Direct rollout, I appreciate you haven't even got a store up and running yet, but have you seen or heard of any sort of competitive response to the planned rollout? No, not at all. We still supply competitors in the space, and there are many. If anything, forward orders are being quite strong. I think we will have a point of difference of what we're going to market with. We're currently very excited about what's going on with Sports Direct. I'm not sure we've sold how good we think it is based on what we're seeing overseas, but it's terribly exciting what's happening in that space for us. Okay, cool. Thanks. That's all from me. Thanks, Wei Wang. Thank you. Our next question comes from Ayan. Ayan, please go ahead and unmute yourself to ask your question. Hey, guys. Can you hear me? Yep. I hope you're well. Just one for me. Just the store guidance, 30 new stores. What's the assumption around store closures into 2026? Sorry if you've already answered this. No, that's a good question, and we haven't answered it. We haven't put out any particular targets around store closures. The way we think about store closures and the way to think about them is as follows. Mathematically, with our portfolio size every year, we have 150+ renewals that have to be negotiated store by store and site by site with our landlords. Our objective is that as we project out the sales of that store over the renewal period and what we think the EBIT's going to be, we have to be confident we can make a return on investment. Ultimately, we know pretty well what the sales are going to be. The balancing number is the rent, and where we can't achieve the rental outcomes that we need, that store has to close. We're quite disciplined about that. One of the reasons for breaking down the closures we had in FY 2025 was to give you a sense that roughly 18 stores closed in FY 2025 as an outcome of those negotiations. As a portion of the renewals we were doing, you can estimate that that's about 10%. I can't project what is actually going to close because it'll be an outcome of all of those negotiations as we get into this next year. They're going well, we're actually getting more wins than not in that space, which is terrific. There will be some that close. We've got another 150 renewals to do over the next 12 months. With those stores that you're closing and you typically close, are they EBIT positive stores? Are they all loss-making and so you actually get a benefit in the P&L when you close it? Yeah, look, typically they're loss-making or very marginally profitable is the answer. That's where you close out in stores that aren't great and you open, you know, you open 54 that theoretically should be and generally are. You should get a benefit from that overall. In the accounts, there's a AUS 3.5 million gain on lease modification. Is that, what's that in this year? Is that factored into guidance when you're looking at the growth and the sort of drag you have on year-on-year growth, please? Look, without speaking specifically to that gain or other, I'm going to say one-offs that were in the P&L. That goes back to the answer that I gave earlier. We don't tend to look at one-offs and worry too much about them at that level. In terms of the guidance for next year, again, it's on the dollars that we delivered this year. In any given year in a business our size, you're going to have some things that are positive and some things that go against you. On balance, they tend to even out over the continuum. Great. Last one quickly. The second half 2025 result, in my mind, you would have had costs associated with Sports Direct in terms of just the due diligence ramp-up of it. To what extent did that dilute your performance? That's not an underlying cost. I guess you haven't generated revenue out of that yet. To what extent is Glue a drag on your EBIT this year as well, please? Yep. In respect of Sports Direct, immaterial in the second half, which is why we sort of haven't called anything out in the accounts in respect to that. Clearly, there'll be some transaction costs associated and so forth, but nothing that's worth shouting out. Glue remains a drag on the EBIT for the second half. You know, we'd like to be able to say that it's better, but it was loss-making in the second half. Great. Thanks, guys. Appreciate it. Thanks. Thank you. We have a follow-up question from Garth. Garth, please unmute yourself to ask your question. Garth, can you hear me? You just unmute if you can hear me. It looks like Garth might be having some audio issues. I will just remind our attendees, if you did have a question, please use the raised hand function. I'll just pause briefly to see if we have any additional questions from our attendees. Hello. Hi, Garth. We can hear you now. Thank you. You can hear me? Oh, terrific. Thanks for taking the call, guys. Just on the loyalty program, it looked like there was a partnership with Live Nation recently. Could you just talk to whether there's a big cost to yourselves to do that and any margin impact that we should expect? If that is, just how your, maybe, the response to that has been? Yes, there is a cost to that. It's within the Platypus budget in terms of what they're doing with their marketing spend. In terms of what it'll do for us, it's essentially Platypus teaming up with the music side of what happens in the youth market, in the youth area. Platypus has always been synonymous with what goes on with music. It's just an exciting time. Yes, there is a cost going. Okay. Maybe if you could just, one last one on Sports Direct, just the license, although the royalty fee that you've got to pay them, can you give us a sense of how impactful that is going to be to your gross margin going forward? Previously, you'd highlighted a goal of hitting 57%. Is that 56.5% as a result, or can you give us a sense of that? That target that you referred to is at a group level being 57%. I don't think we're backing away from that ambition in the mix of our overall business. Having said that, if Sports Direct does what we want, it may well be difficult to get to that sort of percent, but that won't be a bad thing. I'm not going to comment on the royalties other than we feel as though we're going to be able to generate a decent gross margin in the Sports Direct business because of the mix of our distributed brands and the Frasers brands and what they'll do in that business. Terrific. Thank you. Thank you very much. We do have a follow-up question from Wei Wang. Wei Wang, please unmute yourself to ask your question. Hi, guys. I just wanted to go back to guidance again very quickly. High single-digit growth, it's not necessarily dissimilar to kind of where the market is at the moment. I just really want to understand, I guess, what your confidence level is of achieving that. The other thing, follow-up question was, you guys don't typically give guidance a year ahead. I guess, why have you decided to give guidance this time around? Yeah, that's a really good question. I'm happy to answer that part of the confidence level. I'll tell you in January that if we didn't have some confidence, it would be irresponsible for us to put that out today, Wei Wang. I'll leave that there. The reason that we've elected to put guidance out this time is to make sure that we're not dealing with, I'm going to say, overambitious forecasts. We wanted to base everyone realistically around last year is seen as a new base for us. We had hoped that wasn't the case as we set our objectives for FY 2025 off FY 2024. However, it's clear that it is. We wanted to flag very strongly that people should only expect high single-digit growth off that and not more. Indeed, not less so than the other way. Yep. Okay, cool. Thanks so much. No problem. Thank you very much. As we have no additional questions, that brings our Q&A session to a close. I'll hand back to the Accent Group team for any closing remarks. Thank you all for your time. I hope you have a great day and a great weekend. Thank you.

Speaker 7: Thank you, Chiara. Good morning, everyone, and thank you for taking the time to attend the call today. We will now take you through the results for the full year ended June 29, 2025, and a trading update for the first seven weeks of the H1 FY 2026 year. There will be an opportunity to ask some questions at the end. Accent, again, delivered sales, growth, and profitability in the FY 2025 year. I'm pleased with the Accent team's ongoing focus on our customers, product innovation, and high standards of retail execution online and in stores. We continue to make progress against our strategic objectives. If I can now refer you to the operational highlights on page four of our investor presentation, which was released to the ASX this morning. Thank you, Chiara. thank you chiara Good morning, everyone, and thank you for taking the time to attend the call today. good morning everyone and thank you for taking the time to attend the call today We will now take you through the results for the full year ended June 29, 2025, and a trading update for the first seven weeks of the H1 FY 2026 year. we will now take you through the results for the full year ended june 29 2025 and a trading update for the first seven weeks of the h1 fy 2026 year There will be an opportunity to ask some questions at the end. there will be an opportunity to ask some questions at the end Accent , again, delivered sales, growth, and profitability in the FY 2025 year. accent again delivered sales growth and profitability in the fy 2025 year I'm pleased with the Accent team's ongoing focus on our customers, product innovation, and high standards of retail execution online and in stores. i'm pleased with the accent team's ongoing focus on our customers product innovation and high standards of retail execution online and in stores We continue to make progress against our strategic objectives. we continue to make progress against our strategic objectives If I can now refer you to the operational highlights on page four of our investor presentation, which was released to the ASX this morning. if i can now refer you to the operational highlights on page four of our investor presentation which was released to the asx this morning The key highlights include the opening of 54 new stores, bringing the total number of stores to 903, inclusive of our online websites. Vertical owned brands and product sales have grown to more than AUS 130 million, a mix of around 9% of our total sales. New distribution agreements signed with Lacoste and Dickies, with Merrell and Timberland agreements also renewed for further terms. Our long-term Skechers distribution agreement was extended to a 10-year term out to 2035. Skechers is our most important distribution agreement, where we currently have more than 200 stores and a large online and wholesale business. In April, the company signed a long-term strategic partnership with Frasers Group to bring Sports Direct stores to the ANZ retail market. I'm pleased to report that the Sports Direct rollout is on track with our first store due to open in Melbourne in November. The key highlights include the opening of 54 new stores, bringing the total number of stores to 903, inclusive of our online websites. the key highlights include the opening of 54 new stores bringing the total number of stores to 903 inclusive of our online websites Vertical owned brands and product sales have grown to more than AUS 130 million, a mix of around 9% of our total sales. vertical owned brands and product sales have grown to more than aus 130 million a mix of around 9% of our total sales New distribution agreements signed with Lacoste and Dickies, with Merrell and Timberland agreements also renewed for further terms. new distribution agreements signed with lacoste and dickies with merrell and timberland agreements also renewed for further terms Our long-term Skechers distribution agreement was extended to a 10-year term out to 2035. our long-term skechers distribution agreement was extended to a 10-year term out to 2035 Skechers is our most important distribution agreement, where we currently have more than 200 stores and a large online and wholesale business. skechers is our most important distribution agreement where we currently have more than 200 stores and a large online and wholesale business In April, the company signed a long-term strategic partnership with Frasers Group to bring Sports Direct stores to the ANZ retail market. in april the company signed a long-term strategic partnership with frasers group to bring sports direct stores to the anz retail market I'm pleased to report that the Sports Direct rollout is on track with our first store due to open in Melbourne in November. i'm pleased to report that the sports direct rollout is on track with our first store due to open in melbourne in november I will now hand you over to Matthew Durbin to talk through the details of the result. I will now hand you over to Matthew Durbin to talk through the details of the result. i will now hand you over to matthew durbin to talk through the details of the result

Speaker 3: Thanks, Daniel. Turning on to page five, total sales for the year, including to franchisees, were AUS 1.6 billion. EBIT of AUS 110 million was in line with prior year and at the upper end of the guidance of AUS 108 million-AUS 111 million provided in the June trading update. Inventory levels were in line with plan, with aged levels clean. The year-on-year increase in inventory reflects the timing of stock in transit, converting The Athlete’s Foot franchise stores and inventory acquired in conjunction with the Frasers transaction, along with opening inventory for Lacoste and Dickies. In terms of the summary of financial performance on slide six, gross margin was down 85 basis points to 54.9%, reflecting the more promotional consumer environment and in half to the impact of lower sales and disciplined approach taken to managing inventory. Thanks, Daniel. thanks daniel Turning on to page five, total sales for the year, including to franchisees, were AUS 1.6 billion. turning on to page five total sales for the year including to franchisees were aus 1.6 billion EBIT of AUS 110 million was in line with prior year and at the upper end of the guidance of AUS 108 million -AUS 111 million provided in the June trading update. ebit of aus 110 million was in line with prior year and at the upper end of the guidance of aus 108 million -aus 111 million provided in the june trading update Inventory levels were in line with plan, with aged levels clean. inventory levels were in line with plan with aged levels clean The year-on-year increase in inventory reflects the timing of stock in transit, converting The Athlete’s Foot franchise stores and inventory acquired in conjunction with the Frasers transaction, along with opening inventory for Lacoste and Dickies. the year-on-year increase in inventory reflects the timing of stock in transit, converting the athlete’s foot franchise stores and inventory acquired in conjunction with the frasers transaction along with opening inventory for lacoste and dickies In terms of the summary of financial performance on slide six, gross margin was down 85 basis points to 54.9%, reflecting the more promotional consumer environment and in half to the impact of lower sales and disciplined approach taken to managing inventory. in terms of the summary of financial performance on slide six gross margin was down 85 basis points to 54.9% reflecting the more promotional consumer environment and in half to the impact of lower sales and disciplined approach taken to managing inventory Cost of doing business of 46.6%, including list appreciation and interest, was an increase on prior year, arising from low LFL sales in half two and continuing inflationary pressure in store team wages and annualizing rent reviews. Net profit after tax was AUS 57.7 million. Coming on to retail and wholesale on slide eight, owned retail sales grew by 2.5% to AUS 1.3 billion. During the year, 54 new stores were open. New store performance remained strong, with sales and return metrics in line with expectations. Of the 57 stores closed or divested, 39 of these related to divestments and discontinued brands, with a further 18 stores closed where sustainable renewal terms could not be agreed. Wholesale sales of AUS 155 million reflected the challenging macro and consumer conditions in the broader lifestyle footwear market. Cost of doing business of 46.6%, including list appreciation and interest, was an increase on prior year, arising from low LFL sales in half two and continuing inflationary pressure in store team wages and annualizing rent reviews. cost of doing business of 46.6% including list appreciation and interest was an increase on prior year arising from low lfl sales in half two and continuing inflationary pressure in store team wages and annualizing rent reviews Net profit after tax was AUS 57.7 million. net profit after tax was aus 57.7 million Coming on to retail and wholesale on slide eight, owned retail sales grew by 2.5% to AUS 1.3 billion. coming on to retail and wholesale on slide eight owned retail sales grew by 2.5% to aus 1.3 billion During the year, 54 new stores were open. during the year 54 new stores were open New store performance remained strong, with sales and return metrics in line with expectations. new store performance remained strong with sales and return metrics in line with expectations Of the 57 stores closed or divested, 39 of these related to divestments and discontinued brands, with a further 18 stores closed where sustainable renewal terms could not be agreed. of the 57 stores closed or divested 39 of these related to divestments and discontinued brands with a further 18 stores closed where sustainable renewal terms could not be agreed Wholesale sales of AUS 155 million reflected the challenging macro and consumer conditions in the broader lifestyle footwear market. wholesale sales of aus 155 million reflected the challenging macro and consumer conditions in the broader lifestyle footwear market Sales of vertical owned brands and products grew to nearly AUS 130 million, continuing to improve underlying gross margins. The key contributors to the growth were Nude Lucy, Nils, Stylerunner, and Ode. Turning to the growth plan on pages nine and ten, the company continues to have a strong pipeline of growth opportunities. The Sports Direct rollout is on track, with the first Australian Sports Direct store planned to open in Melbourne in November. At least four stores, including online, are planned in FY 2026. At least 50 Sports Direct stores are planned over the next six years. The Lacoste and Dickies distribution agreements both commenced on the 1st of July, with sales starting to grow in FY 2026. There are further store rollout opportunities across the portfolio, with at least 30 stores, excluding Sports Direct, planned to open in FY 2026, including more new stores in Skechers, Nude Lucy, Hoka, Stylerunner, and others. Sales of vertical owned brands and products grew to nearly AUS 130 million, continuing to improve underlying gross margins. sales of vertical owned brands and products grew to nearly aus 130 million continuing to improve underlying gross margins The key contributors to the growth were Nude Lucy, Nils, Stylerunner, and Ode. the key contributors to the growth were nude lucy nils stylerunner and ode Turning to the growth plan on pages nine and ten, the company continues to have a strong pipeline of growth opportunities. turning to the growth plan on pages nine and ten the company continues to have a strong pipeline of growth opportunities The Sports Direct rollout is on track, with the first Australian Sports Direct store planned to open in Melbourne in November. the sports direct rollout is on track with the first australian sports direct store planned to open in melbourne in november At least four stores, including online, are planned in FY 2026. at least four stores including online are planned in fy 2026 At least 50 Sports Direct stores are planned over the next six years. at least 50 sports direct stores are planned over the next six years The Lacoste and Dickies distribution agreements both commenced on the 1st of July, with sales starting to grow in FY 2026. the lacoste and dickies distribution agreements both commenced on the 1st of july with sales starting to grow in fy 2026 There are further store rollout opportunities across the portfolio, with at least 30 stores, excluding Sports Direct, planned to open in FY 2026, including more new stores in Skechers, Nude Lucy, Hoka, Stylerunner, and others. there are further store rollout opportunities across the portfolio with at least 30 stores excluding sports direct planned to open in fy 2026 including more new stores in skechers nude lucy hoka stylerunner and others The all-important Skechers distribution agreement has been extended to a 10-year term out till 2035, reinforcing the position that Accent Group Ltd holds as the distribution partner of choice for global brands in the ANZ retail market. The Athlete’s Foot franchise reacquisition program remains on track. On an annualized basis, the 15 The Athlete’s Foot stores reacquired in FY 2025 generated around AUS 43 million of sales, all strongly profitable. A further 13 reacquisitions are planned in FY 2026. Turning to dividends and the trading update, the company has announced a fully franked dividend of AUS 0.015 per share, bringing total dividends for the year to AUS 0.07 per share. The full year dividends represent a payout ratio of around 70% of earnings per share for the year. Total owned sales for the first seven weeks of FY 2026 are up 2% to last year. Like-for-like retail sales for the first seven weeks are up 0.8%. The all-important Skechers distribution agreement has been extended to a 10-year term out till 2035, reinforcing the position that Accent Group Ltd holds as the distribution partner of choice for global brands in the ANZ retail market. the all-important skechers distribution agreement has been extended to a 10-year term out till 2035 reinforcing the position that accent group ltd holds as the distribution partner of choice for global brands in the anz retail market The Athlete’s Foot franchise reacquisition program remains on track. the athlete’s foot franchise reacquisition program remains on track On an annualized basis, the 15 The Athlete’s Foot stores reacquired in FY 2025 generated around AUS 43 million of sales, all strongly profitable. on an annualized basis the 15 the athlete’s foot stores reacquired in fy 2025 generated around aus 43 million of sales all strongly profitable A further 13 reacquisitions are planned in FY 2026. a further 13 reacquisitions are planned in fy 2026 Turning to dividends and the trading update, the company has announced a fully franked dividend of AUS 0.015 per share, bringing total dividends for the year to AUS 0.07 per share. turning to dividends and the trading update the company has announced a fully franked dividend of aus 0.015 per share bringing total dividends for the year to aus 0.07 per share The full year dividends represent a payout ratio of around 70% of earnings per share for the year. the full year dividends represent a payout ratio of around 70% of earnings per share for the year Total owned sales for the first seven weeks of FY 2026 are up 2% to last year. total owned sales for the first seven weeks of fy 2026 are up 2% to last year Like-for-like retail sales for the first seven weeks are up 0.8%. like-for-like retail sales for the first seven weeks are up 0.8% For the year, the company is targeting low single-digit EBIT growth in FY 2026. This is inclusive of the startup costs expected to be associated with Sports Direct. The outlook for half one FY 2026 EBIT is for a similar level of EBIT to half one FY 2025, with growth in half two FY 2026. This target is based on achieving low single-digit like-for-like sales growth, growth from new and annualizing stores, incremental profit from The Athlete’s Foot franchise reacquisition program, new distributed brands, and continued growth in Hoka and Nude Lucy. Gross margin percentage and cost of doing business percentage are planned to be broadly flat to FY 2025. The projection includes the impact of startup costs for Sports Direct. Now back to Daniel to wrap up. For the year, the company is targeting low single-digit EBIT growth in FY 2026. for the year the company is targeting low single-digit ebit growth in fy 2026 This is inclusive of the startup costs expected to be associated with Sports Direct. this is inclusive of the startup costs expected to be associated with sports direct The outlook for half one FY 2026 EBIT is for a similar level of EBIT to half one FY 2025, with growth in half two FY 2026. the outlook for half one fy 2026 ebit is for a similar level of ebit to half one fy 2025 with growth in half two fy 2026 This target is based on achieving low single-digit like-for-like sales growth, growth from new and annualizing stores, incremental profit from The Athlete’s Foot franchise reacquisition program, new distributed brands, and continued growth in Hoka and Nude Lucy. this target is based on achieving low single-digit like-for-like sales growth growth from new and annualizing stores incremental profit from the athlete’s foot franchise reacquisition program new distributed brands and continued growth in hoka and nude lucy Gross margin percentage and cost of doing business percentage are planned to be broadly flat to FY 2025. gross margin percentage and cost of doing business percentage are planned to be broadly flat to fy 2025 The projection includes the impact of startup costs for Sports Direct. the projection includes the impact of startup costs for sports direct Now back to Daniel to wrap up. now back to daniel to wrap up

Speaker 7: Thanks, Matt. We are pleased with trading the opening weeks of FY 2026. In particular, there are returns of positive like-for-like retail sales growth. Wholesale sales have traded in line with prior year, with strong forward wholesale orders. We're very pleased with what's happening in wholesale. The Accent team is focused on executing our plan for FY 2026, including innovative new product, new stores, launching Sports Direct, growth from our existing and new distributed brands, and a continued drive on cost efficiency, underlining gross margin improvement. The Sports Direct rollout, in particular, is a major growth opportunity for our company over the coming years. Finally, I would also like to take this opportunity to personally acknowledge and thank our Chairman, David Gordon, for his support, leadership, and stewardship of the company over the past 19 years. Thanks, Matt. thanks matt We are pleased with trading the opening weeks of FY 2026. we are pleased with trading the opening weeks of fy 2026 In particular, there are returns of positive like-for-like retail sales growth. in particular there are returns of positive like-for-like retail sales growth Wholesale sales have traded in line with prior year, with strong forward wholesale orders. wholesale sales have traded in line with prior year with strong forward wholesale orders We're very pleased with what's happening in wholesale. we're very pleased with what's happening in wholesale The Accent team is focused on executing our plan for FY 2026, including innovative new product, new stores, launching Sports Direct, growth from our existing and new distributed brands, and a continued drive on cost efficiency, underlining gross margin improvement. the accent team is focused on executing our plan for fy 2026 including innovative new product new stores launching sports direct growth from our existing and new distributed brands and a continued drive on cost efficiency underlining gross margin improvement The Sports Direct rollout, in particular, is a major growth opportunity for our company over the coming years. the sports direct rollout in particular is a major growth opportunity for our company over the coming years Finally, I would also like to take this opportunity to personally acknowledge and thank our Chairman, David Gordon, for his support, leadership, and stewardship of the company over the past 19 years. finally i would also like to take this opportunity to personally acknowledge and thank our chairman david gordon for his support leadership and stewardship of the company over the past 19 years David has announced his intention to retire at the company's AGM in November, and we wish him all the very best for the future. That concludes our presentation today, and we would be happy to take any questions. Thank you. David has announced his intention to retire at the company's AGM in November, and we wish him all the very best for the future. david has announced his intention to retire at the company's agm in november and we wish him all the very best for the future That concludes our presentation today, and we would be happy to take any questions. that concludes our presentation today and we would be happy to take any questions Thank you. thank you

Speaker 8: Thank you. We will now begin the Q&A session. As a reminder, if you would like to ask a question, please select the raised hand button to be placed in the virtual queue. Our first question comes from Garth. Garth, please go ahead and unmute yourself to ask your question. Thank you. thank you We will now begin the Q&A session. we will now begin the q&a session As a reminder, if you would like to ask a question, please select the raised hand button to be placed in the virtual queue. as a reminder if you would like to ask a question please select the raised hand button to be placed in the virtual queue Our first question comes from Garth. our first question comes from garth Garth, please go ahead and unmute yourself to ask your question. garth please go ahead and unmute yourself to ask your question Good day. Can you guys hear me? Good day. good day Can you guys hear me? can you guys hear me

Speaker 7: We can. Thanks, Garth. We can. we can Thanks, Garth. thanks garth Terrific. Good day. Congratulations on the result. Thanks for taking my questions. Just on the trading updates, could you just sort of break down the difference in the lifestyle and performance of lifestyle and the performance of your performance banners? Just that the performance had previously been quite strong, and I just wanted to assess whether that was still a lifestyle that was dragging that down. Terrific. terrific Good day. good day Congratulations on the result. congratulations on the result Thanks for taking my questions. thanks for taking my questions Just on the trading updates, could you just sort of break down the difference in the lifestyle and performance of lifestyle and the performance of your performance banners? just on the trading updates could you just sort of break down the difference in the lifestyle and performance of lifestyle and the performance of your performance banners Just that the performance had previously been quite strong, and I just wanted to assess whether that was still a lifestyle that was dragging that down. just that the performance had previously been quite strong and i just wanted to assess whether that was still a lifestyle that was dragging that down

Speaker 3: Yeah, Garth, thematically, that trend continues. You know the banners like The Athlete’s Foot, Hoka, and Merrell, this is a trend we've talked about now for at least 12 months, continue to perform strongly. The more lifestyle-oriented banners are definitely softer in terms of the growth, albeit, as we called out, what we're starting to see is a strong forward pipeline of wholesale orders, which gives us confidence as a forward read that some strength might be returning in that part of the business. Yeah, Garth, thematically, that trend continues. yeah garth thematically that trend continues You know the banners like The Athlete’s Foot, Hoka, and Merrell, this is a trend we've talked about now for at least 12 months, continue to perform strongly. you know the banners like the athlete’s foot hoka and merrell this is a trend we've talked about now for at least 12 months continue to perform strongly The more lifestyle-oriented banners are definitely softer in terms of the growth, albeit, as we called out, what we're starting to see is a strong forward pipeline of wholesale orders, which gives us confidence as a forward read that some strength might be returning in that part of the business. the more lifestyle-oriented banners are definitely softer in terms of the growth albeit as we called out what we're starting to see is a strong forward pipeline of wholesale orders which gives us confidence as a forward read that some strength might be returning in that part of the business Okay, great. Thanks. Just on that, I think the inventory growth was well above the revenue growth. How confident are you that you're not going to have to discount with that stock that you've got? I know you mentioned it was clean, but is that just related to the new store openings, or is there something that we need to just be conscious of there? Okay, great. okay great Thanks. thanks Just on that, I think the inventory growth was well above the revenue growth. just on that i think the inventory growth was well above the revenue growth How confident are you that you're not going to have to discount with that stock that you've got? how confident are you that you're not going to have to discount with that stock that you've got I know you mentioned it was clean, but is that just related to the new store openings, or is there something that we need to just be conscious of there? i know you mentioned it was clean but is that just related to the new store openings or is there something that we need to just be conscious of there No, there's no issues in terms of the composition of our inventory or the levels. That's why we specifically called out the sort of year-on-year, I'm going to say, one-off impacts, which is new inventory that's coming in for The Athlete’s Foot franchise stores that have converted. We've got opening inventory levels from Lacoste and Dickies, which will translate into sales. You know we haven't made much of a deal about it. We acquired quite a bit of inventory, which you can see in our combinations note there as part of the Frasers deal, part of which will be inventory for wholesale and part for Sports Direct. No, there's no issues in terms of the composition of our inventory or the levels. no there's no issues in terms of the composition of our inventory or the levels That's why we specifically called out the sort of year-on-year, I'm going to say, one-off impacts, which is new inventory that's coming in for The Athlete’s Foot franchise stores that have converted. that's why we specifically called out the sort of year-on-year i'm going to say one-off impacts which is new inventory that's coming in for the athlete’s foot franchise stores that have converted We've got opening inventory levels from Lacoste and Dickies, which will translate into sales. we've got opening inventory levels from lacoste and dickies which will translate into sales You know we haven't made much of a deal about it. you know we haven't made much of a deal about it We acquired quite a bit of inventory, which you can see in our combinations note there as part of the Frasers deal, part of which will be inventory for wholesale and part for Sports Direct. we acquired quite a bit of inventory which you can see in our combinations note there as part of the frasers deal part of which will be inventory for wholesale and part for sports direct All right, terrific. Maybe one more if I can. Just theft has been an issue with one of your peers that was called out yesterday. Are you seeing similar levels, and have you sort of had to factor in any measures to protect staff and stock? All right, terrific. all right terrific Maybe one more if I can. maybe one more if i can Just theft has been an issue with one of your peers that was called out yesterday. just theft has been an issue with one of your peers that was called out yesterday Are you seeing similar levels, and have you sort of had to factor in any measures to protect staff and stock? are you seeing similar levels and have you sort of had to factor in any measures to protect staff and stock are two aspects to that, Garth. I might just talk to the financials around shrink and then Daniel can talk to the team. It's a bit easier for us, I think, than others. We're very diligent on it. You know, when you've got one shoe out on the wall, we're a little bit more protected in the way our business model works. We're not seeing any dramatic increases in shrinkage, to be honest, in our business. are two aspects to that, Garth. are two aspects to that garth I might just talk to the financials around shrink and then Daniel can talk to the team. i might just talk to the financials around shrink and then daniel can talk to the team It's a bit easier for us, I think, than others. it's a bit easier for us i think than others We're very diligent on it. we're very diligent on it You know, when you've got one shoe out on the wall, we're a little bit more protected in the way our business model works. you know when you've got one shoe out on the wall we're a little bit more protected in the way our business model works We're not seeing any dramatic increases in shrinkage, to be honest, in our business. we're not seeing any dramatic increases in shrinkage to be honest in our business Terrific. Thank you. Terrific. terrific Thank you. thank you

Speaker 7: On the people side, Garth, absolutely. We're spending a lot of time making sure that our team is safe. We're doing all we can to advise the shopping centers, in the main, the landlords, that more has to be done in this space. Hopefully, it all goes away for everyone. Certainly, there's been a little bit of a spike, but we've not had incidents that we've heard that others have had to date. Hopefully, we won't. On the people side, Garth, absolutely. on the people side garth absolutely We're spending a lot of time making sure that our team is safe. we're spending a lot of time making sure that our team is safe We're doing all we can to advise the shopping centers, in the main, the landlords, that more has to be done in this space. we're doing all we can to advise the shopping centers in the main the landlords that more has to be done in this space Hopefully, it all goes away for everyone. hopefully it all goes away for everyone Certainly, there's been a little bit of a spike, but we've not had incidents that we've heard that others have had to date. certainly there's been a little bit of a spike but we've not had incidents that we've heard that others have had to date Hopefully, we won't. hopefully we won't Sure. I guess that just means that you wouldn't be able to reduce the number of staff in store just from a safety aspect. That probably gives you a little bit less flex on wage costs looking forward. Sure. sure I guess that just means that you wouldn't be able to reduce the number of staff in store just from a safety aspect. i guess that just means that you wouldn't be able to reduce the number of staff in store just from a safety aspect That probably gives you a little bit less flex on wage costs looking forward. that probably gives you a little bit less flex on wage costs looking forward I think so. We very rarely have any store with just, you know, a single person in store at any rate. Yes, I mean, so far, it has not affected our rostering methodology to this point. I think so. i think so We very rarely have any store with just, you know, a single person in store at any rate. we very rarely have any store with just you know a single person in store at any rate Yes, I mean, so far, it has not affected our rostering methodology to this point. yes i mean so far it has not affected our rostering methodology to this point Terrific. Thank you very much. Terrific. terrific Thank you very much. thank you very much Thanks, Garth. Thanks, Garth. thanks garth

Speaker 8: Thank you. Our next question comes from Jamie. Jamie, please go ahead and unmute yourself to ask your question. Thank you. thank you Our next question comes from Jamie. our next question comes from jamie Jamie, please go ahead and unmute yourself to ask your question. jamie please go ahead and unmute yourself to ask your question Thank you. Good morning, Matt and Dan. Congratulations on some of the announcements today. Good to see. Maybe starting off with the outlook, just to add on to the previous question as well, considering the a bit more than usual skew in FY 2025, could you talk to sort of, you know, when you earlier said first half to be a bit consistent and then second half growth, could you elaborate here? Thank you for EBIT. Thank you. thank you Good morning, Matt and Dan. good morning matt and dan Congratulations on some of the announcements today. congratulations on some of the announcements today Good to see. good to see Maybe starting off with the outlook, just to add on to the previous question as well, considering the a bit more than usual skew in FY 2025, could you talk to sort of, you know, when you earlier said first half to be a bit consistent and then second half growth, could you elaborate here? maybe starting off with the outlook just to add on to the previous question as well considering the a bit more than usual skew in fy 2025 could you talk to sort of you know when you earlier said first half to be a bit consistent and then second half growth could you elaborate here Thank you for EBIT. thank you for ebit

Speaker 3: Yeah, look, there's not much more to say, Jamie. I think, if we look at a, I'm going to say, a normal split of first half, second half profit, and we have a look at what happened in the second half last year, and I'm going to say project through based on the comp sales that we're expecting in the first half and margin and cost of doing business, that growth in the first half on the first half last year, which was actually pretty solid, particularly in hindsight, we think will be challenging. We're just trying to set expectations. First half this year, we're expecting to be flat, and that's what we're targeting. Growth in the second half last year, sorry, the second half of this year against what was, frankly, a disappointing second half. Yeah, look, there's not much more to say, Jamie. yeah look there's not much more to say jamie I think, if we look at a, I'm going to say, a normal split of first half, second half profit, and we have a look at what happened in the second half last year, and I'm going to say project through based on the comp sales that we're expecting in the first half and margin and cost of doing business, that growth in the first half on the first half last year, which was actually pretty solid, particularly in hindsight, we think will be challenging. i think if we look at a i'm going to say a normal split of first half second half profit and we have a look at what happened in the second half last year and i'm going to say project through based on the comp sales that we're expecting in the first half and margin and cost of doing business that growth in the first half on the first half last year which was actually pretty solid particularly in hindsight we think will be challenging We're just trying to set expectations. we're just trying to set expectations First half this year, we're expecting to be flat, and that's what we're targeting. first half this year we're expecting to be flat and that's what we're targeting Growth in the second half last year, sorry, the second half of this year against what was, frankly, a disappointing second half. growth in the second half last year sorry the second half of this year against what was frankly a disappointing second half

Speaker 7: Also, Jamie, I can add that, as I said, we're quite pleased with what we're seeing with forward orders on wholesale. It's been quite positive. Hopefully, that'll hold up, obviously led with Skechers and Hoka being our two biggest brands. That's really a good sign for us. Also, Jamie, I can add that, as I said, we're quite pleased with what we're seeing with forward orders on wholesale. also jamie i can add that as i said we're quite pleased with what we're seeing with forward orders on wholesale It's been quite positive. it's been quite positive Hopefully, that'll hold up, obviously led with Skechers and Hoka being our two biggest brands. hopefully that'll hold up obviously led with skechers and hoka being our two biggest brands That's really a good sign for us. that's really a good sign for us Great. Just on that lifestyle, obviously, macro would be a bigger beneficiary there than the sports brands. How do you feel about the outlook through the next few months or even a bit longer term? Great. great Just on that lifestyle, obviously, macro would be a bigger beneficiary there than the sports brands. just on that lifestyle obviously macro would be a bigger beneficiary there than the sports brands How do you feel about the outlook through the next few months or even a bit longer term? how do you feel about the outlook through the next few months or even a bit longer term Look, I think it all comes down to, you know, what's the economy doing and so on. There's good momentum. Certainly, we've seen good momentum. One of our strongest banners at the moment, Jamie, is Platypus. In the past seven weeks, we're very pleased with that. Our Hype business continues to hold, which is great. Where we are facing some challenges is with Vans, which we've called out over the last couple of years. It's been very soft. Thankfully, the new products that have come in, like Hoka and so on, have been really, really, really positive. Look, I think it all comes down to, you know, what's the economy doing and so on. look i think it all comes down to you know what's the economy doing and so on There's good momentum. there's good momentum Certainly, we've seen good momentum. certainly we've seen good momentum One of our strongest banners at the moment, Jamie, is Platypus. one of our strongest banners at the moment jamie is platypus In the past seven weeks, we're very pleased with that. in the past seven weeks we're very pleased with that Our Hype business continues to hold, which is great. our hype business continues to hold which is great Where we are facing some challenges is with Vans, which we've called out over the last couple of years. where we are facing some challenges is with vans which we've called out over the last couple of years It's been very soft. it's been very soft Thankfully, the new products that have come in, like Hoka and so on, have been really, really, really positive. thankfully the new products that have come in like hoka and so on have been really really really positive Perfect. Thanks for that. Secondly, from me, looking at the new store number for FY 2026 out of Sports Direct, at least 30. What are you prioritizing here outside that key banner, outside the key Sports Direct banner? Perfect. perfect Thanks for that. thanks for that Secondly, from me, looking at the new store number for FY 2026 out of Sports Direct, at least 30. secondly from me looking at the new store number for fy 2026 out of sports direct at least 30 What are you prioritizing here outside that key banner, outside the key Sports Direct banner? what are you prioritizing here outside that key banner outside the key sports direct banner I think there's still great growth in larger Skechers stores. Where we've tried a couple, they've been solid. Given what's going on with anything sport, and we're very happy with what's going on in The Athlete’s Foot, we will look to convert some of our current biggest stores into The Athlete’s Foot and indeed look for new ones based on what we're seeing. I guess that's where the growth will be. By the time you get four or five Stylerunners, four or five Nude Lucys, there's 10 stores right there. I think it's going to get down to, Jamie, we're driving pretty hard negotiations with our landlords that if we can't get the right metrics, we simply won't do it. We're in no rush to just be out on a mad run to open more stores. They have to hit the metrics. There's great opportunity. I think there's still great growth in larger Skechers stores. i think there's still great growth in larger skechers stores Where we've tried a couple, they've been solid. where we've tried a couple they've been solid Given what's going on with anything sport, and we're very happy with what's going on in The Athlete’s Foot, we will look to convert some of our current biggest stores into The Athlete’s Foot and indeed look for new ones based on what we're seeing. given what's going on with anything sport and we're very happy with what's going on in the athlete’s foot we will look to convert some of our current biggest stores into the athlete’s foot and indeed look for new ones based on what we're seeing I guess that's where the growth will be. i guess that's where the growth will be By the time you get four or five Stylerunners, four or five Nude Lucys, there's 10 stores right there. by the time you get four or five stylerunners four or five nude lucys there's 10 stores right there I think it's going to get down to, Jamie, we're driving pretty hard negotiations with our landlords that if we can't get the right metrics, we simply won't do it. i think it's going to get down to jamie we're driving pretty hard negotiations with our landlords that if we can't get the right metrics we simply won't do it We're in no rush to just be out on a mad run to open more stores. we're in no rush to just be out on a mad run to open more stores They have to hit the metrics. they have to hit the metrics There's great opportunity. there's great opportunity On top of that, we've opened a couple of Hoka stores in the last couple of weeks. One we opened yesterday, and we're seeing pretty strong results out of those stores. There's a pipeline of stuff that we can do there. Also, I can add that we're in the market at the moment looking for Lacoste stores. By the time you add all of those up, we should easily achieve what our aspirations are in new store openings. On top of that, we've opened a couple of Hoka stores in the last couple of weeks. on top of that we've opened a couple of hoka stores in the last couple of weeks One we opened yesterday, and we're seeing pretty strong results out of those stores. one we opened yesterday and we're seeing pretty strong results out of those stores There's a pipeline of stuff that we can do there. there's a pipeline of stuff that we can do there Also, I can add that we're in the market at the moment looking for Lacoste stores. also i can add that we're in the market at the moment looking for lacoste stores By the time you add all of those up, we should easily achieve what our aspirations are in new store openings. by the time you add all of those up we should easily achieve what our aspirations are in new store openings Perfect. Thanks, Dan. Thanks, Matt. I'll jump back in the queue. Perfect. perfect Thanks, Dan. thanks dan Thanks, Matt. thanks matt I'll jump back in the queue. i'll jump back in the queue

Speaker 3: Thanks, Jamie. Thanks, Jamie. thanks jamie

Speaker 8: Thank you. Our next question comes from Sam. Sam, please go ahead and unmute yourself to ask your question. Thank you. thank you Our next question comes from Sam. our next question comes from sam Sam, please go ahead and unmute yourself to ask your question. sam please go ahead and unmute yourself to ask your question Oh, hi, Daniel. Hi, Matt. Just on the guidance, just to be firm. It sounds like in the region of AUS 118 million-AUS 120 million of EBIT on the AUS 110 million is what you're thinking as high single digit, just given there was a one-off on the AUS 110 million. We're all on the same page. Oh, hi, Daniel. oh hi daniel Hi, Matt. hi matt Just on the guidance, just to be firm. just on the guidance just to be firm It sounds like in the region of AUS 118 million -AUS 120 million of EBIT on the AUS 110 million is what you're thinking as high single digit, just given there was a one-off on the AUS 110 million. it sounds like in the region of aus 118 million -aus 120 million of ebit on the aus 110 million is what you're thinking as high single digit just given there was a one-off on the aus 110 million We're all on the same page. we're all on the same page

Speaker 3: Yep. That's a fair assumption, Sam, given the projection there for high single digit growth into FY 2026. Yep. Mathematically, 118 is high single digit growth. Yep. yep That's a fair assumption, Sam, given the projection there for high single digit growth into FY 2026. that's a fair assumption sam given the projection there for high single digit growth into fy 2026 Yep. yep Mathematically, 118 is high single digit growth. mathematically 118 is high single digit growth Can you sort of give further color on the startup costs, what that includes, marketing, team, and other components, and any numbers around that just to help us understand what that is within that guidance? Thank you. Can you sort of give further color on the startup costs, what that includes, marketing, team, and other components, and any numbers around that just to help us understand what that is within that guidance? can you sort of give further color on the startup costs what that includes marketing team and other components and any numbers around that just to help us understand what that is within that guidance Thank you. thank you Yeah, no problem, Sam. Look, I won't provide any numbers. However, the types of costs that are incurred ahead of the curve are clearly standing up a team to get the stores launched. There's buying teams, there's planning that needs to be done, there's store operations, backend warehouse operations. There's quite a bit of investment that goes into that. Some of it CapEx, some of it OpEx. Marketing is also a big cost when you're trying to establish a brand. In terms of the, I'm going to say, the ahead of the curve components, those are the two you're dealing with. If we're aiming to open 30 stores over the next sort of three years, you can imagine that marketing is insignificant in terms of what we're thinking about over that period of time. Yeah, no problem, Sam. yeah no problem sam Look, I won't provide any numbers. look i won't provide any numbers However, the types of costs that are incurred ahead of the curve are clearly standing up a team to get the stores launched. however the types of costs that are incurred ahead of the curve are clearly standing up a team to get the stores launched There's buying teams, there's planning that needs to be done, there's store operations, backend warehouse operations. there's buying teams there's planning that needs to be done there's store operations backend warehouse operations There's quite a bit of investment that goes into that. there's quite a bit of investment that goes into that Some of it CapEx, some of it OpEx. some of it capex some of it opex Marketing is also a big cost when you're trying to establish a brand. marketing is also a big cost when you're trying to establish a brand In terms of the, I'm going to say, the ahead of the curve components, those are the two you're dealing with. in terms of the i'm going to say the ahead of the curve components those are the two you're dealing with If we're aiming to open 30 stores over the next sort of three years, you can imagine that marketing is insignificant in terms of what we're thinking about over that period of time. if we're aiming to open 30 stores over the next sort of three years you can imagine that marketing is insignificant in terms of what we're thinking about over that period of time When will that marketing start before the first launch, or will you wait till you get a few stores under your belt? When will that marketing start before the first launch, or will you wait till you get a few stores under your belt? when will that marketing start before the first launch or will you wait till you get a few stores under your belt Concurrently, it'll start with the first launch, but the investment around that first launch will be localized, very focused on that store opening and then digital. We expect the online site will open at around the same time, if not a bit earlier than the store. Performance marketing, other digital marketing, and then as the network starts to grow, we'd expect that that marketing will be more broad-based. Concurrently, it'll start with the first launch, but the investment around that first launch will be localized, very focused on that store opening and then digital. concurrently it'll start with the first launch but the investment around that first launch will be localized very focused on that store opening and then digital We expect the online site will open at around the same time, if not a bit earlier than the store. we expect the online site will open at around the same time if not a bit earlier than the store Performance marketing, other digital marketing, and then as the network starts to grow, we'd expect that that marketing will be more broad-based. performance marketing other digital marketing and then as the network starts to grow we'd expect that that marketing will be more broad-based Just encouraging that you've locked in all your called out four stores and at least four stores. It sounds like securing site so far is, you know, you've got a good line of sight there. Just encouraging that you've locked in all your called out four stores and at least four stores. just encouraging that you've locked in all your called out four stores and at least four stores It sounds like securing site so far is, you know, you've got a good line of sight there. it sounds like securing site so far is you know you've got a good line of sight there

Speaker 7: Yeah, Sam, I've been quite surprised. It's amazing when there's no space, but then you get a hot business coming to the market, they tend to find the space. Yes, we've got many we're negotiating on at the moment, but we're really, we're being very picky, to be honest, where we'd like to open. Of course, we need the metrics to match. At the end of the day, the consumer's going to vote. I think what we've put together and what we're seeing coming from the Frasers Group internationally, we're excited about getting this one open. Yeah, Sam, I've been quite surprised. yeah sam i've been quite surprised It's amazing when there's no space, but then you get a hot business coming to the market, they tend to find the space. it's amazing when there's no space but then you get a hot business coming to the market they tend to find the space Yes, we've got many we're negotiating on at the moment, but we're really, we're being very picky, to be honest, where we'd like to open. yes we've got many we're negotiating on at the moment but we're really we're being very picky to be honest where we'd like to open Of course, we need the metrics to match. of course we need the metrics to match At the end of the day, the consumer's going to vote. at the end of the day the consumer's going to vote I think what we've put together and what we're seeing coming from the Frasers Group internationally, we're excited about getting this one open. i think what we've put together and what we're seeing coming from the frasers group internationally we're excited about getting this one open Final question from me, just on the, it's encouraging to see lifestyle improve. Can you talk about whether that's product-driven, macro-driven, execution-driven, or a combination? Final question from me, just on the, it's encouraging to see lifestyle improve. final question from me just on the it's encouraging to see lifestyle improve Can you talk about whether that's product-driven, macro-driven, execution-driven, or a combination? can you talk about whether that's product-driven macro-driven execution-driven or a combination I think it's a combination, Sam. There's definitely more momentum. We felt it coming for the past six or seven weeks. Our comps have improved, and there has been a little bit more of product innovation. We're fairly confident of what we've seen in the forward pipeline from all of our brands that there's good innovation coming, albeit a lot of it is sport-inspired and that's sort of what the market's wanting at the moment. That's starting to bleed into the lifestyle space, which is good news. Part of the great results coming out of Hype is purely chasing that trend, and the likes of Platypus and so on are very close behind that now, growing in that area fast. I think it's a combination, Sam. i think it's a combination sam There's definitely more momentum. there's definitely more momentum We felt it coming for the past six or seven weeks. we felt it coming for the past six or seven weeks Our comps have improved, and there has been a little bit more of product innovation. our comps have improved and there has been a little bit more of product innovation We're fairly confident of what we've seen in the forward pipeline from all of our brands that there's good innovation coming, albeit a lot of it is sport-inspired and that's sort of what the market's wanting at the moment. we're fairly confident of what we've seen in the forward pipeline from all of our brands that there's good innovation coming albeit a lot of it is sport-inspired and that's sort of what the market's wanting at the moment That's starting to bleed into the lifestyle space, which is good news. that's starting to bleed into the lifestyle space which is good news Part of the great results coming out of Hype is purely chasing that trend, and the likes of Platypus and so on are very close behind that now, growing in that area fast. part of the great results coming out of hype is purely chasing that trend and the likes of platypus and so on are very close behind that now growing in that area fast Thank you. Thank you. thank you

Speaker 8: Thank you very much, Sam. Our next question comes from Ed. Ed, please go ahead and unmute yourself to ask your question. Thank you very much, Sam. thank you very much sam Our next question comes from Ed. our next question comes from ed Ed, please go ahead and unmute yourself to ask your question. ed please go ahead and unmute yourself to ask your question Hey, Tim, can you hear me okay? One more time. Hey, Tim, can you hear me okay? hey tim can you hear me okay One more time. one more time

Speaker 3: Yep, thanks, Ed. Yep, thanks, Ed. yep thanks ed Hi, thanks for taking the question. It was good to see the EBIT coming in at the top end of the guidance range. I was just curious, given that you provided that in June, did anything change through June? Was there any improvement in the macro environment? Have you seen any improvement in the gross margin environment, or is it too early to say yet? Hi, thanks for taking the question. hi thanks for taking the question It was good to see the EBIT coming in at the top end of the guidance range. it was good to see the ebit coming in at the top end of the guidance range I was just curious, given that you provided that in June, did anything change through June? i was just curious given that you provided that in june did anything change through june Was there any improvement in the macro environment? was there any improvement in the macro environment Have you seen any improvement in the gross margin environment, or is it too early to say yet? have you seen any improvement in the gross margin environment or is it too early to say yet A couple of comments around June. You can deduct fairly easily looking at our trading update in June and then the final comp number for the second half that the last three weeks of June were very challenging. That's like a little bit of a trend of what we're seeing in that lifestyle period. When we go on sale, we're not getting the uplifts that we have seen in the past year or two. That certainly happened. We'd seen that trend and factored that in. Part of the reason I'm going to say that that guidance range was a surprise to everyone at the time was there was a projection in that that ended up coming true. We didn't see anything we didn't expect, I'm going to say, in that last three weeks of June, which is why we were able to hit the top end of guidance. A couple of comments around June. a couple of comments around june You can deduct fairly easily looking at our trading update in June and then the final comp number for the second half that the last three weeks of June were very challenging. you can deduct fairly easily looking at our trading update in june and then the final comp number for the second half that the last three weeks of june were very challenging That's like a little bit of a trend of what we're seeing in that lifestyle period. that's like a little bit of a trend of what we're seeing in that lifestyle period When we go on sale, we're not getting the uplifts that we have seen in the past year or two. when we go on sale we're not getting the uplifts that we have seen in the past year or two That certainly happened. that certainly happened We'd seen that trend and factored that in. we'd seen that trend and factored that in Part of the reason I'm going to say that that guidance range was a surprise to everyone at the time was there was a projection in that that ended up coming true. part of the reason i'm going to say that that guidance range was a surprise to everyone at the time was there was a projection in that that ended up coming true We didn't see anything we didn't expect, I'm going to say, in that last three weeks of June, which is why we were able to hit the top end of guidance. we didn't see anything we didn't expect i'm going to say in that last three weeks of june which is why we were able to hit the top end of guidance Look, I'm very reluctant to call out margin at the moment. We've said that we expect it to be around the same level as last year. As we sit here right now, I'm very confident of that projection, but we're only seven weeks in. Look, I'm very reluctant to call out margin at the moment. look i'm very reluctant to call out margin at the moment We've said that we expect it to be around the same level as last year. we've said that we expect it to be around the same level as last year As we sit here right now, I'm very confident of that projection, but we're only seven weeks in. as we sit here right now i'm very confident of that projection but we're only seven weeks in Okay, no, that's helpful. You've also talked to like-for-like retail sales retaining growth in FY 2026. Just talk through what you think drives that. Is it more full price sales, more foot traffic? Which way should we be thinking there? I know you're kind of careful to say pull out margin now, but yeah, what's implicit in that? Okay, no, that's helpful. okay no that's helpful You've also talked to like-for-like retail sales retaining growth in FY 2026. you've also talked to like-for-like retail sales retaining growth in fy 2026 Just talk through what you think drives that. just talk through what you think drives that Is it more full price sales, more foot traffic? is it more full price sales more foot traffic Which way should we be thinking there? which way should we be thinking there I know you're kind of careful to say pull out margin now, but yeah, what's implicit in that? i know you're kind of careful to say pull out margin now but yeah what's implicit in that I think there's a couple of things going on in the macro. I think certainly interest rates are going to start to help us. In the back end of last year, in particular, we were cycling some pretty strong comps in Skechers from the prior year. That's now out of the base, so that's positive. We're starting to see, as Daniel said, some positive momentum in Platypus. There's a few things pointing to that lifestyle side of the business starting to recover. Certainly the forward wholesale pipeline being strong, we feel gives us a forward read. It's as strong as we've seen it for 18 months. That's probably, that's reflective of how others are sort of thinking about the next 6-9 months as well. I think there's a couple of things going on in the macro. i think there's a couple of things going on in the macro I think certainly interest rates are going to start to help us. i think certainly interest rates are going to start to help us In the back end of last year, in particular, we were cycling some pretty strong comps in Skechers from the prior year. in the back end of last year in particular we were cycling some pretty strong comps in skechers from the prior year That's now out of the base, so that's positive. that's now out of the base so that's positive We're starting to see, as Daniel said, some positive momentum in Platypus. we're starting to see as daniel said some positive momentum in platypus There's a few things pointing to that lifestyle side of the business starting to recover. there's a few things pointing to that lifestyle side of the business starting to recover Certainly the forward wholesale pipeline being strong, we feel gives us a forward read. certainly the forward wholesale pipeline being strong we feel gives us a forward read It's as strong as we've seen it for 18 months. it's as strong as we've seen it for 18 months That's probably, that's reflective of how others are sort of thinking about the next 6-9 months as well. that's probably that's reflective of how others are sort of thinking about the next 6-9 months as well

Speaker 7: The other thing that we've been experiencing, which is great news for us in the industry, is the average transaction has gone up in many of our banners, particularly in the Hype and Stylerunner business. That's really positive for us. A lot of the reason for that is because some of the shoes and the styles that are coming in have got some performance within them. That obviously causes an extra cost and price, but there hasn't been the resistance that I thought we may get, particularly in the last, you know, call it a couple of months. That hopefully will lead to an easier manner to chase the comps. The other thing that we've been experiencing, which is great news for us in the industry, is the average transaction has gone up in many of our banners, particularly in the Hype and Stylerunner business. the other thing that we've been experiencing which is great news for us in the industry is the average transaction has gone up in many of our banners particularly in the hype and stylerunner business That's really positive for us. that's really positive for us A lot of the reason for that is because some of the shoes and the styles that are coming in have got some performance within them. a lot of the reason for that is because some of the shoes and the styles that are coming in have got some performance within them That obviously causes an extra cost and price, but there hasn't been the resistance that I thought we may get, particularly in the last, you know, call it a couple of months. that obviously causes an extra cost and price but there hasn't been the resistance that i thought we may get particularly in the last you know call it a couple of months That hopefully will lead to an easier manner to chase the comps. that hopefully will lead to an easier manner to chase the comps All right, thanks for the color. Maybe just one last one from me, and apologies if you've addressed this somewhere in the materials already, just on your new comments, the FX rate that you seem to hedge for for 2026, is there any quality you can provide there? All right, thanks for the color . all right thanks for the color Maybe just one last one from me, and apologies if you've addressed this somewhere in the materials already, just on your new comments, the FX rate that you seem to hedge for for 2026, is there any quality you can provide there? maybe just one last one from me and apologies if you've addressed this somewhere in the materials already just on your new comments the fx rate that you seem to hedge for for 2026 is there any quality you can provide there

Speaker 3: If you go to the chart that we provided in the back end of the slide pack, you can see that for the FY 2025 year, we actualized at around that 66, 65 level. Everyone could observe as well as I can that over the last six months, the dollar's been bouncing around between 63-65. You can imagine that any hedging that we've done would be at around those levels. Right now, if we're buying spot, we're buying it around those levels as well. As we come into this year, it's fair to say that currency will be a headwind year on year. If you go to the chart that we provided in the back end of the slide pack, you can see that for the FY 2025 year, we actualized at around that 66, 65 level. if you go to the chart that we provided in the back end of the slide pack you can see that for the fy 2025 year we actualized at around that 66 65 level Everyone could observe as well as I can that over the last six months, the dollar's been bouncing around between 63- 65. everyone could observe as well as i can that over the last six months the dollar's been bouncing around between 63- 65 You can imagine that any hedging that we've done would be at around those levels. you can imagine that any hedging that we've done would be at around those levels Right now, if we're buying spot, we're buying it around those levels as well. right now if we're buying spot we're buying it around those levels as well As we come into this year, it's fair to say that currency will be a headwind year on year. as we come into this year it's fair to say that currency will be a headwind year on year When we talk about maintaining the percentage margin, what's feeding into that is we are hopeful at this point that the promotional environment won't be as severe as it was last year with interest rate cuts and hopefully the household budgets starting to feel a bit better. At the same time, we talked about, Daniel talked there about ATVs increasing, so some price increases. The other element is we're continuing to get benefits under the covers from the work that we're doing around vertical and distributed. As Hoka grows, Skechers returns to growth this year, and with some other distributed brands coming in and the strength of Nude Lucy, that helps the underlying margin in the mix. When we talk about maintaining the percentage margin, what's feeding into that is we are hopeful at this point that the promotional environment won't be as severe as it was last year with interest rate cuts and hopefully the household budgets starting to feel a bit better. when we talk about maintaining the percentage margin what's feeding into that is we are hopeful at this point that the promotional environment won't be as severe as it was last year with interest rate cuts and hopefully the household budgets starting to feel a bit better At the same time, we talked about, Daniel talked there about ATVs increasing, so some price increases. at the same time we talked about daniel talked there about atvs increasing so some price increases The other element is we're continuing to get benefits under the covers from the work that we're doing around vertical and distributed. the other element is we're continuing to get benefits under the covers from the work that we're doing around vertical and distributed As Hoka grows, Skechers returns to growth this year, and with some other distributed brands coming in and the strength of Nude Lucy, that helps the underlying margin in the mix. as hoka grows skechers returns to growth this year and with some other distributed brands coming in and the strength of nude lucy that helps the underlying margin in the mix All right, thanks, Matt. All right, thanks, Matt. all right thanks matt Yep. Yep. yep

Speaker 8: Thank you. Our next question comes from Sean. Sean, please go ahead and unmute yourself to ask your question. Thank you. thank you Our next question comes from Sean. our next question comes from sean Sean, please go ahead and unmute yourself to ask your question. sean please go ahead and unmute yourself to ask your question Great. Good morning. Can you hear me? Great. great Good morning. good morning Can you hear me? can you hear me

Speaker 7: Thanks, Sean. Thanks, Sean. thanks sean Fantastic. Thank you. Maybe just to clarify the first half 2026 guidance to be in line with first half 2025. I think this might have been addressed, but just to make it really clear, your first half 2025 was AUS 80.653 million. That included a AUS 9.7 million gain on a reversible impairment, a AUS 3.8 million impairment, and a AUS 2.6 million one-off. What is the dollar base that we should be looking for, please? Maybe you could just, it's a busy morning, so there's a good chance that I and others may, but certainly me, will get this wrong. Fantastic. fantastic Thank you. thank you Maybe just to clarify the first half 2026 guidance to be in line with first half 2025. maybe just to clarify the first half 2026 guidance to be in line with first half 2025 I think this might have been addressed, but just to make it really clear, your first half 2025 was AUS 80.653 million. i think this might have been addressed but just to make it really clear your first half 2025 was aus 80.653 million That included a AUS 9.7 million gain on a reversible impairment, a AUS 3.8 million impairment, and a AUS 2.6 million one-off. that included a aus 9.7 million gain on a reversible impairment a aus 3.8 million impairment and a aus 2.6 million one-off What is the dollar base that we should be looking for, please? what is the dollar base that we should be looking for please Maybe you could just, it's a busy morning, so there's a good chance that I and others may, but certainly me, will get this wrong. maybe you could just it's a busy morning so there's a good chance that i and others may but certainly me will get this wrong

Speaker 3: That's a good question, Sean. When we talk about our results, we don't sort of talk in relation to underlying. It's just too complicated for everyone. When we talk about flat, I'm talking about an ambition to be flat to the dollars that were delivered or the result that was delivered. You could say that there's a small amount of underlying growth in that, but to not confuse everyone, it's the AUS 80 million. When we say that's there or thereabouts what we're targeting, that's the number. That's a good question, Sean. that's a good question sean When we talk about our results, we don't sort of talk in relation to underlying. when we talk about our results we don't sort of talk in relation to underlying It's just too complicated for everyone. it's just too complicated for everyone When we talk about flat, I'm talking about an ambition to be flat to the dollars that were delivered or the result that was delivered. when we talk about flat i'm talking about an ambition to be flat to the dollars that were delivered or the result that was delivered You could say that there's a small amount of underlying growth in that, but to not confuse everyone, it's the AUS 80 million. you could say that there's a small amount of underlying growth in that but to not confuse everyone it's the aus 80 million When we say that's there or thereabouts what we're targeting, that's the number. when we say that's there or thereabouts what we're targeting that's the number Perfect. No, thank you for the clarity. Maybe just on cost of doing business reductions, the company had embarked on several sort of quite effective reductions in cost of doing business above the store level. I'm just curious around the degree of cost savings that had been possibly realized. Maybe they needed to be reinvested in fiscal 2025 and the degree to which any may come through in fiscal 2026, please. Perfect. perfect No, thank you for the clarity. no thank you for the clarity Maybe just on cost of doing business reductions, the company had embarked on several sort of quite effective reductions in cost of doing business above the store level. maybe just on cost of doing business reductions the company had embarked on several sort of quite effective reductions in cost of doing business above the store level I'm just curious around the degree of cost savings that had been possibly realized. i'm just curious around the degree of cost savings that had been possibly realized Maybe they needed to be reinvested in fiscal 2025 and the degree to which any may come through in fiscal 2026, please. maybe they needed to be reinvested in fiscal 2025 and the degree to which any may come through in fiscal 2026 please We continue to drive cost efficiencies in a number of areas of our business. Through the period this year, we were cycling through the benefits of a support office headcount reduction, and we will get some benefits of that indeed. In the core business in the first quarter of this year, offsetting that is that we've got startup costs associated with Sports Direct that are coming into the first half. The program continues to try to drive costs and aim to drive costs, and we're having success in distribution costs, in marketing costs, in particular digital marketing costs, the amount we spend with Google and TikTok and so forth. As we have improved our own channel data analytics, that's helping us target the 10 million customers that we have in our database. We continue to drive cost efficiencies in a number of areas of our business. we continue to drive cost efficiencies in a number of areas of our business Through the period this year, we were cycling through the benefits of a support office headcount reduction, and we will get some benefits of that indeed. through the period this year we were cycling through the benefits of a support office headcount reduction and we will get some benefits of that indeed In the core business in the first quarter of this year, offsetting that is that we've got startup costs associated with Sports Direct that are coming into the first half. in the core business in the first quarter of this year offsetting that is that we've got startup costs associated with sports direct that are coming into the first half The program continues to try to drive costs and aim to drive costs, and we're having success in distribution costs, in marketing costs, in particular digital marketing costs, the amount we spend with Google and TikTok and so forth. the program continues to try to drive costs and aim to drive costs and we're having success in distribution costs in marketing costs in particular digital marketing costs the amount we spend with google and tiktok and so forth As we have improved our own channel data analytics, that's helping us target the 10 million customers that we have in our database. as we have improved our own channel data analytics that's helping us target the 10 million customers that we have in our database There is a constant battle at lease renewal that goes on to make sure that our occupancy costs remain in line as a percent to sales. You will see in the result there was deleverage in that in the second half. As I've maintained, if we're not achieving low single-digit like-for-like retail sales growth where you have 3%-4% inflationary factors, it's quite difficult to drive leverage on that. If you think about our cost of doing business and the statement that we are aiming to have cost of doing business broadly in line as a percentage with FY 2025, as we go into FY 2026, there continues to be a lot of work that has to be done under the covers to achieve that, albeit some of the inflationary pressures are starting to moderate a little. There is a constant battle at lease renewal that goes on to make sure that our occupancy costs remain in line as a percent to sales. there is a constant battle at lease renewal that goes on to make sure that our occupancy costs remain in line as a percent to sales You will see in the result there was deleverage in that in the second half. you will see in the result there was deleverage in that in the second half As I've maintained, if we're not achieving low single-digit like-for-like retail sales growth where you have 3 %- 4% inflationary factors, it's quite difficult to drive leverage on that. as i've maintained if we're not achieving low single-digit like-for-like retail sales growth where you have 3 %- 4% inflationary factors it's quite difficult to drive leverage on that If you think about our cost of doing business and the statement that we are aiming to have cost of doing business broadly in line as a percentage with FY 2025, as we go into FY 2026, there continues to be a lot of work that has to be done under the covers to achieve that, albeit some of the inflationary pressures are starting to moderate a little. if you think about our cost of doing business and the statement that we are aiming to have cost of doing business broadly in line as a percentage with fy 2025 as we go into fy 2026 there continues to be a lot of work that has to be done under the covers to achieve that albeit some of the inflationary pressures are starting to moderate a little Having said that, it's a fact that the frontline team costs are going to go up at 3%-3.5% again this year. You need a couple of percent of comp sales, otherwise you have to take team off the floor. As we heard from an earlier question, we're not in the business of taking team off the floor for safety, but as much as anything for customer execution and good store execution. Having said that, it's a fact that the frontline team costs are going to go up at 3%- 3.5% again this year. having said that it's a fact that the frontline team costs are going to go up at 3%- 3.5% again this year You need a couple of percent of comp sales, otherwise you have to take team off the floor. you need a couple of percent of comp sales otherwise you have to take team off the floor As we heard from an earlier question, we're not in the business of taking team off the floor for safety, but as much as anything for customer execution and good store execution. as we heard from an earlier question we're not in the business of taking team off the floor for safety but as much as anything for customer execution and good store execution Great. My final question is just on Sports Direct. Can I ask how you balance the requirement, and then maybe if you could amplify the requirement for Sports Direct for you to sort of sell brands that, be it sort of Slazenger, Everlast, Lonsdale, which have sort of more of a mixed reputation in this market? How do you manage the requirement to sell those brands with selling the leading brands and particularly doing the right thing by your own distributors in terms of sort of Deckers for the Hoka brand, which has been very well, in terms of the distribution's been very judiciously managed in the appropriate sort of channels? I'm just curious how you sort of manage those different requirements and how you put that into a store where you're making each of those different parties happy and having an attractive offer for the consumer. Great. great My final question is just on Sports Direct. my final question is just on sports direct Can I ask how you balance the requirement, and then maybe if you could amplify the requirement for Sports Direct for you to sort of sell brands that, be it sort of Slazenger, Everlast, Lonsdale, which have sort of more of a mixed reputation in this market? can i ask how you balance the requirement and then maybe if you could amplify the requirement for sports direct for you to sort of sell brands that be it sort of slazenger everlast lonsdale which have sort of more of a mixed reputation in this market How do you manage the requirement to sell those brands with selling the leading brands and particularly doing the right thing by your own distributors in terms of sort of Deckers for the Hoka brand, which has been very well, in terms of the distribution's been very judiciously managed in the appropriate sort of channels? how do you manage the requirement to sell those brands with selling the leading brands and particularly doing the right thing by your own distributors in terms of sort of deckers for the hoka brand which has been very well in terms of the distribution's been very judiciously managed in the appropriate sort of channels I'm just curious how you sort of manage those different requirements and how you put that into a store where you're making each of those different parties happy and having an attractive offer for the consumer. i'm just curious how you sort of manage those different requirements and how you put that into a store where you're making each of those different parties happy and having an attractive offer for the consumer I'm just curious if you could talk a bit about that predicament that you face merchandising the store, please. I'm just curious if you could talk a bit about that predicament that you face merchandising the store, please. i'm just curious if you could talk a bit about that predicament that you face merchandising the store please I might have the first go at that. I think the best thing to do is to sort of reference the Sports Direct global model. They're very much about premium branded and value. What you will find in a Sports Direct store is you'll find a terrifically branded Nike concept footy area, which is going to have the best Nike boot on the wall. We will have that in Sports Direct. For the parent that comes in and then wants a kid's boot, we will have a very keenly priced Sondico footy boot, which is a brand that we're going to make great margin on, and the customer will see the value. That's the global model, Sean. I don't want to say too much more other than we're going to execute what Sports Direct do and what the brands around the world appreciate them doing. I might have the first go at that. i might have the first go at that I think the best thing to do is to sort of reference the Sports Direct global model. i think the best thing to do is to sort of reference the sports direct global model They're very much about premium branded and value. they're very much about premium branded and value What you will find in a Sports Direct store is you'll find a terrifically branded Nike concept footy area, which is going to have the best Nike boot on the wall. what you will find in a sports direct store is you'll find a terrifically branded nike concept footy area which is going to have the best nike boot on the wall We will have that in Sports Direct. we will have that in sports direct For the parent that comes in and then wants a kid's boot, we will have a very keenly priced Sondico footy boot, which is a brand that we're going to make great margin on, and the customer will see the value. for the parent that comes in and then wants a kid's boot we will have a very keenly priced sondico footy boot which is a brand that we're going to make great margin on and the customer will see the value That's the global model, Sean. that's the global model sean I don't want to say too much more other than we're going to execute what Sports Direct do and what the brands around the world appreciate them doing. i don't want to say too much more other than we're going to execute what sports direct do and what the brands around the world appreciate them doing

Speaker 7: I think it's a good question too. Obviously, that was one we looked at before doing anything. The support from all the brands, including the distributed brands that we distribute, has been nothing short of great. From our own point of view, the brands that we sell, the buyers will simply go and buy it based on the merit of the product. All of our brands that should be in a sport store will be in the store and very strongly represented. I think it's a good question too. i think it's a good question too Obviously, that was one we looked at before doing anything. obviously that was one we looked at before doing anything The support from all the brands, including the distributed brands that we distribute, has been nothing short of great. the support from all the brands including the distributed brands that we distribute has been nothing short of great From our own point of view, the brands that we sell, the buyers will simply go and buy it based on the merit of the product. from our own point of view the brands that we sell the buyers will simply go and buy it based on the merit of the product All of our brands that should be in a sport store will be in the store and very strongly represented. all of our brands that should be in a sport store will be in the store and very strongly represented Fantastic. Thanks so much, Matt. Thanks, Daniel. Fantastic. fantastic Thanks so much, Matt. thanks so much matt Thanks, Daniel. thanks daniel

Speaker 3: Yep, thanks, Sean. Yep, thanks, Sean. yep thanks sean

Speaker 8: Thank you. Our next question comes from Sam. Sam, please go ahead and unmute yourself to ask your question. Thank you. thank you Our next question comes from Sam. our next question comes from sam Sam, please go ahead and unmute yourself to ask your question. sam please go ahead and unmute yourself to ask your question Thank you very much. Hi, Daniel. Hi, Matt. Thanks for the presentation this morning. This is probably one of the softest periods I've seen Accent go through for some time outside of COVID. To your credit, you've managed costs very, very well in this period. My sense is a lot of people have left the business recently. From all the broader cost-out initiatives undertaken, what's the risk here that when conditions rebound in the lifestyle footwear space, you won't have enough people to see the leverage and execute on the way back up? Will you end up having to put back in a lot of the costs that you've taken out in recent times? Thank you very much. thank you very much Hi, Daniel. hi daniel Hi, Matt. hi matt Thanks for the presentation this morning. thanks for the presentation this morning This is probably one of the softest periods I've seen Accent go through for some time outside of COVID. this is probably one of the softest periods i've seen accent go through for some time outside of covid To your credit, you've managed costs very, very well in this period. to your credit you've managed costs very very well in this period My sense is a lot of people have left the business recently. my sense is a lot of people have left the business recently From all the broader cost-out initiatives undertaken, what's the risk here that when conditions rebound in the lifestyle footwear space, you won't have enough people to see the leverage and execute on the way back up? from all the broader cost-out initiatives undertaken what's the risk here that when conditions rebound in the lifestyle footwear space you won't have enough people to see the leverage and execute on the way back up Will you end up having to put back in a lot of the costs that you've taken out in recent times? will you end up having to put back in a lot of the costs that you've taken out in recent times

Speaker 3: Sam, that's a great question. There are a couple of aspects to that question. If I think about the customer-facing aspects of our business and the engine that drives what we do with customers, both being retail customers and wholesale customers every day, that's not the areas that we've pulled back. In fact, our team levels in store, store managers, assistant store managers, area managers, we haven't touched those ranks at all. What we've aimed to do is look at support office functions predominantly, where we've been able to put in more efficiency initiatives. We've been doing offshoring as well into Vietnam and, in fact, more recently into Manila in the Philippines. We're finding great cost efficiencies in, I'm going to say, support office team doing repetitive type tasks, data-driven tasks, and we've found some great savings through that area. Sam, that's a great question. There are a couple of aspects to that question. sam that's a great question. there are a couple of aspects to that question If I think about the customer-facing aspects of our business and the engine that drives what we do with customers, both being retail customers and wholesale customers every day, that's not the areas that we've pulled back. if i think about the customer-facing aspects of our business and the engine that drives what we do with customers both being retail customers and wholesale customers every day that's not the areas that we've pulled back In fact, our team levels in store, store managers, assistant store managers, area managers, we haven't touched those ranks at all. in fact our team levels in store store managers assistant store managers area managers we haven't touched those ranks at all What we've aimed to do is look at support office functions predominantly, where we've been able to put in more efficiency initiatives. what we've aimed to do is look at support office functions predominantly where we've been able to put in more efficiency initiatives We've been doing offshoring as well into Vietnam and, in fact, more recently into Manila in the Philippines. we've been doing offshoring as well into vietnam and in fact more recently into manila in the philippines We're finding great cost efficiencies in, I'm going to say, support office team doing repetitive type tasks, data-driven tasks, and we've found some great savings through that area. we're finding great cost efficiencies in i'm going to say support office team doing repetitive type tasks data-driven tasks and we've found some great savings through that area I don't think we'd feel uncomfortable that where like-for-like retail sales go, there should be good leverage on that for us. I don't think we'd feel uncomfortable that where like-for-like retail sales go, there should be good leverage on that for us. i don't think we'd feel uncomfortable that where like-for-like retail sales go there should be good leverage on that for us

Speaker 7: Okay. Yeah. Sam, I can only add that I don't think the exercise was simply just to take people out. It was more of an exercise to say, what do we look like if we start thinking about right-sizing the business from a people point of view? I think we're largely there, and I think particularly my management team, we're in a great place. I don't think that that certainly won't be an excuse if we can't execute. It won't be from lack of people. Okay. okay Yeah. yeah Sam, I can only add that I don't think the exercise was simply just to take people out. sam i can only add that i don't think the exercise was simply just to take people out It was more of an exercise to say, what do we look like if we start thinking about right-sizing the business from a people point of view? it was more of an exercise to say what do we look like if we start thinking about right-sizing the business from a people point of view I think we're largely there, and I think particularly my management team, we're in a great place. i think we're largely there and i think particularly my management team we're in a great place I don't think that that certainly won't be an excuse if we can't execute. i don't think that that certainly won't be an excuse if we can't execute It won't be from lack of people. it won't be from lack of people Sure. Can we explore the theft issue a bit more? How's this Victorian crime situation impacting your thinking around how many Sports Direct stores you want in Victoria or the rents you can afford to pay in Victoria unless the police and courts start to clamp down on this issue, given the types of products in a Sports Direct will be much more susceptible to theft than your pure play footwear banners? Daniel, maybe it'd be good to get your thoughts on, do you think the retail industry is doing enough effective lobbying of government to take this issue more seriously? Sure. sure Can we explore the theft issue a bit more? can we explore the theft issue a bit more How's this Victorian crime situation impacting your thinking around how many Sports Direct stores you want in Victoria or the rents you can afford to pay in Victoria unless the police and courts start to clamp down on this issue, given the types of products in a Sports Direct will be much more susceptible to theft than your pure play footwear banners? how's this victorian crime situation impacting your thinking around how many sports direct stores you want in victoria or the rents you can afford to pay in victoria unless the police and courts start to clamp down on this issue given the types of products in a sports direct will be much more susceptible to theft than your pure play footwear banners Daniel, maybe it'd be good to get your thoughts on, do you think the retail industry is doing enough effective lobbying of government to take this issue more seriously? daniel maybe it'd be good to get your thoughts on do you think the retail industry is doing enough effective lobbying of government to take this issue more seriously I don't think we've done enough as an industry, no. I think we need to do more. It's all over the news. It's all over the social media. There's, without any doubt, issues, particularly in Victoria. I hope the people that are qualified will do something about it. Like all the other retailers out there, the likes of JD Sports, Anaconda, and so on, we will simply follow the model of what Sports Direct are doing internationally. On the main days, I dare say we may end up employing a security guard, a security at the front of stores. That seems to be a model worldwide for these big stores. It's an area that we're going to learn and fall in line with. However, a lot of the stores, the way they've been designed, we will have team placed at the front of the store as well, proper rostered teams. I don't think we've done enough as an industry, no. i don't think we've done enough as an industry no I think we need to do more. i think we need to do more It's all over the news. it's all over the news It's all over the social media. it's all over the social media There's, without any doubt, issues, particularly in Victoria. there's without any doubt issues particularly in victoria I hope the people that are qualified will do something about it. i hope the people that are qualified will do something about it Like all the other retailers out there, the likes of JD Sports, Anaconda, and so on, we will simply follow the model of what Sports Direct are doing internationally. like all the other retailers out there the likes of jd sports anaconda and so on we will simply follow the model of what sports direct are doing internationally On the main days, I dare say we may end up employing a security guard, a security at the front of stores. on the main days i dare say we may end up employing a security guard a security at the front of stores That seems to be a model worldwide for these big stores. that seems to be a model worldwide for these big stores It's an area that we're going to learn and fall in line with. it's an area that we're going to learn and fall in line with However, a lot of the stores, the way they've been designed, we will have team placed at the front of the store as well, proper rostered teams. however a lot of the stores the way they've been designed we will have team placed at the front of the store as well proper rostered teams Again, it's nothing new for us. It's where we're taking lead here from Sports Direct International. Again, it's nothing new for us. again it's nothing new for us It's where we're taking lead here from Sports Direct International. it's where we're taking lead here from sports direct international Got it. All right. Thank you. Got it. got it All right. all right Thank you. thank you

Speaker 3: Thanks, Tim. Thanks, Tim. thanks tim

Speaker 8: Thank you. Our next question comes from Wei Wang. Wei Wang, please unmute yourself to ask your question. Thank you. thank you Our next question comes from Wei Wang. our next question comes from wei wang Wei Wang, please unmute yourself to ask your question. wei wang please unmute yourself to ask your question Thanks, guys. Apologies if this has been asked before. On your guidance assumption of flat gross margins, what have you assumed regarding promotional activity in FY 2026? Is it flat because you're comping an equally promotional FY 2025, or are you assuming in flat guidance that FY 2026 will be less promotional? Thanks, guys. thanks guys Apologies if this has been asked before. apologies if this has been asked before On your guidance assumption of flat gross margins, what have you assumed regarding promotional activity in FY 2026? on your guidance assumption of flat gross margins what have you assumed regarding promotional activity in fy 2026 Is it flat because you're comping an equally promotional FY 2025, or are you assuming in flat guidance that FY 2026 will be less promotional? is it flat because you're comping an equally promotional fy 2025 or are you assuming in flat guidance that fy 2026 will be less promotional

Speaker 3: Look, it's impossible to know, but broadly flat. We think we might get some benefits in some periods in respect to margin against last year, but broadly flat. I'll tell you in January. Look, it's impossible to know, but broadly flat. look it's impossible to know but broadly flat We think we might get some benefits in some periods in respect to margin against last year, but broadly flat. we think we might get some benefits in some periods in respect to margin against last year but broadly flat I'll tell you in January. i'll tell you in january Okay. With the Sports Direct rollout, I appreciate you haven't even got a store up and running yet, but have you seen or heard of any sort of competitive response to the planned rollout? Okay. okay With the Sports Direct rollout, I appreciate you haven't even got a store up and running yet, but have you seen or heard of any sort of competitive response to the planned rollout? with the sports direct rollout i appreciate you haven't even got a store up and running yet but have you seen or heard of any sort of competitive response to the planned rollout

Speaker 7: No, not at all. We still supply competitors in the space, and there are many. If anything, forward orders are being quite strong. I think we will have a point of difference of what we're going to market with. We're currently very excited about what's going on with Sports Direct. I'm not sure we've sold how good we think it is based on what we're seeing overseas, but it's terribly exciting what's happening in that space for us. No, not at all. no not at all We still supply competitors in the space, and there are many. we still supply competitors in the space and there are many If anything, forward orders are being quite strong. if anything forward orders are being quite strong I think we will have a point of difference of what we're going to market with. i think we will have a point of difference of what we're going to market with We're currently very excited about what's going on with Sports Direct. we're currently very excited about what's going on with sports direct I'm not sure we've sold how good we think it is based on what we're seeing overseas, but it's terribly exciting what's happening in that space for us. i'm not sure we've sold how good we think it is based on what we're seeing overseas but it's terribly exciting what's happening in that space for us Okay, cool. Thanks. That's all from me. Okay, cool. okay cool Thanks. thanks That's all from me. that's all from me

Speaker 3: Thanks, Wei Wang. Thanks, Wei Wang. thanks wei wang

Speaker 8: Thank you. Our next question comes from Ayan. Ayan, please go ahead and unmute yourself to ask your question. Thank you. thank you Our next question comes from Ayan. our next question comes from ayan Ayan, please go ahead and unmute yourself to ask your question. ayan please go ahead and unmute yourself to ask your question Hey, guys. Can you hear me? Hey, guys. hey guys Can you hear me? can you hear me

Speaker 3: Yep. Yep. yep I hope you're well. Just one for me. Just the store guidance, 30 new stores. What's the assumption around store closures into 2026? Sorry if you've already answered this. I hope you're well. i hope you're well Just one for me. just one for me Just the store guidance, 30 new stores. just the store guidance 30 new stores What's the assumption around store closures into 2026? what's the assumption around store closures into 2026 Sorry if you've already answered this. sorry if you've already answered this No, that's a good question, and we haven't answered it. We haven't put out any particular targets around store closures. The way we think about store closures and the way to think about them is as follows. Mathematically, with our portfolio size every year, we have 150+ renewals that have to be negotiated store by store and site by site with our landlords. Our objective is that as we project out the sales of that store over the renewal period and what we think the EBIT's going to be, we have to be confident we can make a return on investment. Ultimately, we know pretty well what the sales are going to be. The balancing number is the rent, and where we can't achieve the rental outcomes that we need, that store has to close. We're quite disciplined about that. No, that's a good question, and we haven't answered it. no that's a good question and we haven't answered it We haven't put out any particular targets around store closures. we haven't put out any particular targets around store closures The way we think about store closures and the way to think about them is as follows. the way we think about store closures and the way to think about them is as follows Mathematically, with our portfolio size every year, we have 150+ renewals that have to be negotiated store by store and site by site with our landlords. mathematically with our portfolio size every year we have 150+ renewals that have to be negotiated store by store and site by site with our landlords Our objective is that as we project out the sales of that store over the renewal period and what we think the EBIT's going to be, we have to be confident we can make a return on investment. our objective is that as we project out the sales of that store over the renewal period and what we think the ebit's going to be we have to be confident we can make a return on investment Ultimately, we know pretty well what the sales are going to be. ultimately we know pretty well what the sales are going to be The balancing number is the rent, and where we can't achieve the rental outcomes that we need, that store has to close. the balancing number is the rent and where we can't achieve the rental outcomes that we need that store has to close We're quite disciplined about that. we're quite disciplined about that One of the reasons for breaking down the closures we had in FY 2025 was to give you a sense that roughly 18 stores closed in FY 2025 as an outcome of those negotiations. As a portion of the renewals we were doing, you can estimate that that's about 10%. I can't project what is actually going to close because it'll be an outcome of all of those negotiations as we get into this next year. They're going well, we're actually getting more wins than not in that space, which is terrific. There will be some that close. We've got another 150 renewals to do over the next 12 months. One of the reasons for breaking down the closures we had in FY 2025 was to give you a sense that roughly 18 stores closed in FY 2025 as an outcome of those negotiations. one of the reasons for breaking down the closures we had in fy 2025 was to give you a sense that roughly 18 stores closed in fy 2025 as an outcome of those negotiations As a portion of the renewals we were doing, you can estimate that that's about 10%. as a portion of the renewals we were doing you can estimate that that's about 10% I can't project what is actually going to close because it'll be an outcome of all of those negotiations as we get into this next year. i can't project what is actually going to close because it'll be an outcome of all of those negotiations as we get into this next year They're going well, we're actually getting more wins than not in that space, which is terrific. they're going well we're actually getting more wins than not in that space which is terrific There will be some that close. there will be some that close We've got another 150 renewals to do over the next 12 months. we've got another 150 renewals to do over the next 12 months With those stores that you're closing and you typically close, are they EBIT positive stores? Are they all loss-making and so you actually get a benefit in the P&L when you close it? With those stores that you're closing and you typically close, are they EBIT positive stores? with those stores that you're closing and you typically close are they ebit positive stores Are they all loss-making and so you actually get a benefit in the P&L when you close it? are they all loss-making and so you actually get a benefit in the p&l when you close it Yeah, look, typically they're loss-making or very marginally profitable is the answer. That's where you close out in stores that aren't great and you open, you know, you open 54 that theoretically should be and generally are. You should get a benefit from that overall. Yeah, look, typically they're loss-making or very marginally profitable is the answer. yeah look typically they're loss-making or very marginally profitable is the answer That's where you close out in stores that aren't great and you open, you know, you open 54 that theoretically should be and generally are. that's where you close out in stores that aren't great and you open you know you open 54 that theoretically should be and generally are You should get a benefit from that overall. you should get a benefit from that overall In the accounts, there's a AUS 3.5 million gain on lease modification. Is that, what's that in this year? Is that factored into guidance when you're looking at the growth and the sort of drag you have on year-on-year growth, please? In the accounts, there's a AUS 3.5 million gain on lease modification. in the accounts there's a aus 3.5 million gain on lease modification Is that, what's that in this year? is that what's that in this year Is that factored into guidance when you're looking at the growth and the sort of drag you have on year-on-year growth, please? is that factored into guidance when you're looking at the growth and the sort of drag you have on year-on-year growth please Look, without speaking specifically to that gain or other, I'm going to say one-offs that were in the P&L. That goes back to the answer that I gave earlier. We don't tend to look at one-offs and worry too much about them at that level. In terms of the guidance for next year, again, it's on the dollars that we delivered this year. In any given year in a business our size, you're going to have some things that are positive and some things that go against you. On balance, they tend to even out over the continuum. Look, without speaking specifically to that gain or other, I'm going to say one-offs that were in the P&L. look without speaking specifically to that gain or other i'm going to say one-offs that were in the p&l That goes back to the answer that I gave earlier. that goes back to the answer that i gave earlier We don't tend to look at one-offs and worry too much about them at that level. we don't tend to look at one-offs and worry too much about them at that level In terms of the guidance for next year, again, it's on the dollars that we delivered this year. in terms of the guidance for next year again it's on the dollars that we delivered this year In any given year in a business our size, you're going to have some things that are positive and some things that go against you. in any given year in a business our size you're going to have some things that are positive and some things that go against you On balance, they tend to even out over the continuum. on balance they tend to even out over the continuum Great. Last one quickly. The second half 2025 result, in my mind, you would have had costs associated with Sports Direct in terms of just the due diligence ramp-up of it. To what extent did that dilute your performance? That's not an underlying cost. I guess you haven't generated revenue out of that yet. To what extent is Glue a drag on your EBIT this year as well, please? Great. great Last one quickly. last one quickly The second half 2025 result, in my mind, you would have had costs associated with Sports Direct in terms of just the due diligence ramp-up of it. the second half 2025 result in my mind you would have had costs associated with sports direct in terms of just the due diligence ramp-up of it To what extent did that dilute your performance? to what extent did that dilute your performance That's not an underlying cost. that's not an underlying cost I guess you haven't generated revenue out of that yet. i guess you haven't generated revenue out of that yet To what extent is Glue a drag on your EBIT this year as well, please? to what extent is glue a drag on your ebit this year as well please Yep. In respect of Sports Direct, immaterial in the second half, which is why we sort of haven't called anything out in the accounts in respect to that. Clearly, there'll be some transaction costs associated and so forth, but nothing that's worth shouting out. Glue remains a drag on the EBIT for the second half. You know, we'd like to be able to say that it's better, but it was loss-making in the second half. Yep. yep In respect of Sports Direct, immaterial in the second half, which is why we sort of haven't called anything out in the accounts in respect to that. in respect of sports direct immaterial in the second half which is why we sort of haven't called anything out in the accounts in respect to that Clearly, there'll be some transaction costs associated and so forth, but nothing that's worth shouting out. clearly there'll be some transaction costs associated and so forth but nothing that's worth shouting out Glue remains a drag on the EBIT for the second half. glue remains a drag on the ebit for the second half You know, we'd like to be able to say that it's better, but it was loss-making in the second half. you know we'd like to be able to say that it's better but it was loss-making in the second half Great. Thanks, guys. Appreciate it. Great. great Thanks, guys. thanks guys Appreciate it. appreciate it Thanks. Thanks. thanks

Speaker 8: Thank you. We have a follow-up question from Garth. Garth, please unmute yourself to ask your question. Garth, can you hear me? You just unmute if you can hear me. It looks like Garth might be having some audio issues. I will just remind our attendees, if you did have a question, please use the raised hand function. I'll just pause briefly to see if we have any additional questions from our attendees. Thank you. thank you We have a follow-up question from Garth. we have a follow-up question from garth Garth, please unmute yourself to ask your question. garth please unmute yourself to ask your question Garth, can you hear me? garth can you hear me You just unmute if you can hear me. you just unmute if you can hear me It looks like Garth might be having some audio issues. it looks like garth might be having some audio issues I will just remind our attendees, if you did have a question, please use the raised hand function. i will just remind our attendees if you did have a question please use the raised hand function I'll just pause briefly to see if we have any additional questions from our attendees. i'll just pause briefly to see if we have any additional questions from our attendees Hello. Hello. hello Hi, Garth. We can hear you now. Thank you. Hi, Garth. hi garth We can hear you now. we can hear you now Thank you. thank you You can hear me? Oh, terrific. Thanks for taking the call, guys. Just on the loyalty program, it looked like there was a partnership with Live Nation recently. Could you just talk to whether there's a big cost to yourselves to do that and any margin impact that we should expect? If that is, just how your, maybe, the response to that has been? You can hear me? you can hear me Oh, terrific. oh terrific Thanks for taking the call, guys. thanks for taking the call guys Just on the loyalty program, it looked like there was a partnership with Live Nation recently. just on the loyalty program it looked like there was a partnership with live nation recently Could you just talk to whether there's a big cost to yourselves to do that and any margin impact that we should expect? could you just talk to whether there's a big cost to yourselves to do that and any margin impact that we should expect If that is, just how your, maybe, the response to that has been? if that is just how your maybe the response to that has been

Speaker 7: Yes, there is a cost to that. It's within the Platypus budget in terms of what they're doing with their marketing spend. In terms of what it'll do for us, it's essentially Platypus teaming up with the music side of what happens in the youth market, in the youth area. Platypus has always been synonymous with what goes on with music. It's just an exciting time. Yes, there is a cost going. Yes, there is a cost to that. yes there is a cost to that It's within the Platypus budget in terms of what they're doing with their marketing spend. it's within the platypus budget in terms of what they're doing with their marketing spend In terms of what it'll do for us, it's essentially Platypus teaming up with the music side of what happens in the youth market, in the youth area. in terms of what it'll do for us it's essentially platypus teaming up with the music side of what happens in the youth market in the youth area Platypus has always been synonymous with what goes on with music. platypus has always been synonymous with what goes on with music It's just an exciting time. it's just an exciting time Yes, there is a cost going. yes there is a cost going Okay. Maybe if you could just, one last one on Sports Direct, just the license, although the royalty fee that you've got to pay them, can you give us a sense of how impactful that is going to be to your gross margin going forward? Previously, you'd highlighted a goal of hitting 57%. Is that 56.5% as a result, or can you give us a sense of that? Okay. okay Maybe if you could just, one last one on Sports Direct, just the license, although the royalty fee that you've got to pay them, can you give us a sense of how impactful that is going to be to your gross margin going forward? maybe if you could just one last one on sports direct just the license although the royalty fee that you've got to pay them can you give us a sense of how impactful that is going to be to your gross margin going forward Previously, you'd highlighted a goal of hitting 57%. previously you'd highlighted a goal of hitting 57% Is that 56.5% as a result, or can you give us a sense of that? is that 56.5% as a result or can you give us a sense of that

Speaker 3: That target that you referred to is at a group level being 57%. I don't think we're backing away from that ambition in the mix of our overall business. Having said that, if Sports Direct does what we want, it may well be difficult to get to that sort of percent, but that won't be a bad thing. I'm not going to comment on the royalties other than we feel as though we're going to be able to generate a decent gross margin in the Sports Direct business because of the mix of our distributed brands and the Frasers brands and what they'll do in that business. That target that you referred to is at a group level being 57%. that target that you referred to is at a group level being 57% I don't think we're backing away from that ambition in the mix of our overall business. i don't think we're backing away from that ambition in the mix of our overall business Having said that, if Sports Direct does what we want, it may well be difficult to get to that sort of percent, but that won't be a bad thing. having said that if sports direct does what we want it may well be difficult to get to that sort of percent but that won't be a bad thing I'm not going to comment on the royalties other than we feel as though we're going to be able to generate a decent gross margin in the Sports Direct business because of the mix of our distributed brands and the Frasers brands and what they'll do in that business. i'm not going to comment on the royalties other than we feel as though we're going to be able to generate a decent gross margin in the sports direct business because of the mix of our distributed brands and the frasers brands and what they'll do in that business Terrific. Thank you. Terrific. terrific Thank you. thank you

Speaker 8: Thank you very much. We do have a follow-up question from Wei Wang. Wei Wang, please unmute yourself to ask your question. Thank you very much. thank you very much We do have a follow-up question from Wei Wang. we do have a follow-up question from wei wang Wei Wang, please unmute yourself to ask your question. wei wang please unmute yourself to ask your question Hi, guys. I just wanted to go back to guidance again very quickly. High single-digit growth, it's not necessarily dissimilar to kind of where the market is at the moment. I just really want to understand, I guess, what your confidence level is of achieving that. The other thing, follow-up question was, you guys don't typically give guidance a year ahead. I guess, why have you decided to give guidance this time around? Hi, guys. hi guys I just wanted to go back to guidance again very quickly. i just wanted to go back to guidance again very quickly High single-digit growth, it's not necessarily dissimilar to kind of where the market is at the moment. I just really want to understand, I guess, what your confidence level is of achieving that. high single-digit growth it's not necessarily dissimilar to kind of where the market is at the moment. i just really want to understand i guess what your confidence level is of achieving that The other thing, follow-up question was, you guys don't typically give guidance a year ahead. the other thing follow-up question was you guys don't typically give guidance a year ahead I guess, why have you decided to give guidance this time around? i guess why have you decided to give guidance this time around

Speaker 3: Yeah, that's a really good question. I'm happy to answer that part of the confidence level. I'll tell you in January that if we didn't have some confidence, it would be irresponsible for us to put that out today, Wei Wang. I'll leave that there. The reason that we've elected to put guidance out this time is to make sure that we're not dealing with, I'm going to say, overambitious forecasts. We wanted to base everyone realistically around last year is seen as a new base for us. We had hoped that wasn't the case as we set our objectives for FY 2025 off FY 2024. However, it's clear that it is. We wanted to flag very strongly that people should only expect high single-digit growth off that and not more. Indeed, not less so than the other way. Yep. Yeah, that's a really good question. yeah that's a really good question I'm happy to answer that part of the confidence level. i'm happy to answer that part of the confidence level I'll tell you in January that if we didn't have some confidence, it would be irresponsible for us to put that out today, Wei Wang. i'll tell you in january that if we didn't have some confidence it would be irresponsible for us to put that out today wei wang I'll leave that there. i'll leave that there The reason that we've elected to put guidance out this time is to make sure that we're not dealing with, I'm going to say, overambitious forecasts. the reason that we've elected to put guidance out this time is to make sure that we're not dealing with i'm going to say overambitious forecasts We wanted to base everyone realistically around last year is seen as a new base for us. we wanted to base everyone realistically around last year is seen as a new base for us We had hoped that wasn't the case as we set our objectives for FY 2025 off FY 2024. we had hoped that wasn't the case as we set our objectives for fy 2025 off fy 2024 However, it's clear that it is. however it's clear that it is We wanted to flag very strongly that people should only expect high single-digit growth off that and not more. we wanted to flag very strongly that people should only expect high single-digit growth off that and not more Indeed, not less so than the other way. indeed not less so than the other way Yep. yep Okay, cool. Thanks so much. Okay, cool. okay cool Thanks so much. thanks so much No problem. No problem. no problem

Speaker 8: Thank you very much. As we have no additional questions, that brings our Q&A session to a close. I'll hand back to the Accent Group team for any closing remarks. Thank you very much. thank you very much As we have no additional questions, that brings our Q&A session to a close. as we have no additional questions that brings our q&a session to a close I'll hand back to the Accent Group team for any closing remarks. i'll hand back to the accent group team for any closing remarks

Speaker 7: Thank you all for your time. I hope you have a great day and a great weekend. Thank you. Thank you all for your time. thank you all for your time I hope you have a great day and a great weekend. i hope you have a great day and a great weekend Thank you. thank you