New Zealand Professional Investment Services Firm

Forsyth Barr

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

New Zealand Professional Investment Services Firm, Forsyth Barr

Equity Bottom-Up

<ul><li>Despite confirming consensus expectations less than three months ago, Synlait Milk's (SML) -60% FY23 NPAT downgrade again highlights (1) the high degree of operating leverage within the business, and (2) transparency on key drivers remains very limited</li><li>Headline valuation multiples (~11x FY24 PE and ~0.9x FY24 EV/IC) are not overly demanding, particularly relative to its own history.</li><li>To justify a change in investment view we require evidence of strategic execution to gain confidence in SML's earnings and returns trajectory.</li></ul>

Despite confirming consensus expectations less than three months ago, Synlait Milk's (SML) -60% FY23 NPAT downgrade again highlights (1) the high degree of operating leverage within the business, and (2) transparency on key drivers remains very limitedHeadline valuation multiples (~11x FY24 PE and ~0.9x FY24 EV/IC) are not overly demanding, particularly relative to its own history.To justify a change in investment view we require evidence of strategic execution to gain confidence in SML's earnings and returns trajectory.

Synlait Milk

Synlait Milk: As Clear As Milk