Dear fellow shareholders,

For the financial year ending 30 June 2024 (FY24), the NSC Investment Portfolio fell by –22.93%, compared to the Benchmark S&P/ASX Small Ordinaries Accumulation Index (XSOAI), which increased by +9.34%. FY24 marked the worst financial year return of NSC by some margin since its inception in 2017.

I want to be very clear and acknowledge this performance is not an acceptable return, and heading into FY24, we did not think producing such a poor result was even a remote possibility. My fellow Directors and I, many of our staff, and our extended networks and families are some of the largest investors in each of the NAOS LICs, so this underperformance hits home in a profound way.

As I will elaborate in this letter, I firmly believe the current share prices of many of our core investments do not truly reflect their long-term value. We remain steadfast in our view that the true value of these investments are significantly higher than where they stand today. Throughout the year, we have spoken with many sources to stress test our investment thesis for each of these investments, who have overwhelmingly corroborated our viewpoint regarding long-term value. As an investor in emerging companies, we expect these businesses should be able to substantially grow their earnings per share (EPS) over time, and frankly, most of our core investments have not hit our internal growth hurdles this financial year. However, this is not to say these businesses will not be able to grow EPS to substantially higher levels in FY25 or FY26. If this occurs and the macro environment becomes more favourable for such businesses, we believe the
re-rate to fair value will be significant.

We believe we are business owners, and our investing mentality should be aligned to this. That is why we will often seek board representation on the companies we invest in, through a NAOS representative. At present, a NAOS representative sits on the board of eight of our investments, which we believe helps to support the respective executive teams and ensure they are taking the right steps to achieve their long-term strategic goals. If they successfully execute, this should lead to maximised shareholder value over the long term.

Has The Market Structure Changed Investing Forever?

Earlier in the year, highly regarded US-based investor, David Einhorn gave an excellent analysis on what is moving markets today, particularly on the changing structure of the market.

He argues that a significant portion of investment capital in the market either cannot assess valuations due to a lack of training, does not care about valuations (i.e. passive index funds or ETFs), or intentionally ignores valuations in favour of price-focused strategies (i.e. technical or quantitative strategies).

Einhorn illustrates this with an example of two companies both having a fair value of $1 billion. If one is undervalued by the market and has a market capitalisation of $500 million, and the other is overvalued with a market capitalisation of $2 billion, a market capitalisation-weighted index fund investing $5 will allocate $4 to the overvalued company and only $1 to the undervalued one. This leads to the overvalued stock receiving disproportionately more investment, causing it to outperform, while the undervalued stock underperforms.

This issue is compounded when new investments into index funds come from redemptions from active managers who had previously allocated more to undervalued stocks. When money is withdrawn from these active managers and reinvested in index funds, the undervalued stock faces net selling, and the overvalued stock sees net buying, driving their valuations further apart.

The rise of passive investing over recent years has seen several trillion dollars redeployed in this fashion, which in Einhorn’s words “has fundamentally broken the market”.

Looking at the ASX, Commonwealth Bank of Australia (ASX: CBA) would be the prime example of this in the domestic market. As at 30 June, CBA shares were trading at $127.38, just below their record high. The share price has increased by +26.2% over the last 12 months and inclusive of dividends, has delivered a total shareholder return of +31.7%, markedly higher than the S&P/ASX 200 Accumulation Index FY24 return of +11.4%. Where the increase in CBA shares ties in with Einhorn’s comments is in relation to its EPS growth. FY24 EPS is expected to decrease by –1%, then looking ahead to FY25, consensus estimates are forecasting earnings growth to be negative again, circa –3%. As such, CBA currently trades on a price-to-earnings (P/E) multiple of 21.9x, and given the decrease in EPS for FY25, this will increase to 22.7x.

Based on these metrics, I would argue the investment case for CBA goes against many of the fundamentals of investment analysis, such as looking for businesses that can provide sustainable EPS growth, as well as seeking businesses that do not require an ever-increasing amount of capital to achieve this, which leads to a reducing return on equity (ROE).

Commonwealth Bank – Share Price vs. EPS

Commonwealth Bank – Key Metrics‍

So, why is the price of CBA shares at a record high? When considering the current macro environment, one that is more conducive to low credit growth and increasing bad debts, this appears illogical. However, let us not forget, CBA is the second-largest business on the ASX by market capitalisation, and also a highly liquid one. It has provided investors with a relatively stable stream of dividends and in theory should continue to do so. If you have exposure to an exchange traded fund (ETF) that seeks to provide exposure to the ASX 100, Australian financials, or even large, listed businesses in Asia, chances are CBA will form part of that exposure. As these ETFs continue to increase in size and popularity, many of them will continue to acquire CBA shares regardless of price and/or value.

Interestingly, when looking at global banking peers, CBA would rank the fifth most expensive in terms of valuation. This is out of 120 banks that have a market capitalisation greater than $85 billion (for context, ANZ Group has a market capitalisation of $86 billion).

Looking to the S&P 500 in the US, a notable trend that has been occurring for some time now is the market breadth (or the number of stocks moving up versus those declining) has been decreasing at an ever-accelerating rate. Despite this, the S&P 500 has already set 30 all-time highs so far in CY24. The S&P 500 recorded a gain of +22.7% in FY24, but as we can see from the chart overleaf, the major contributors to this performance were five of the so-called “Magnificent 7”, namely NVIDIA, Microsoft, Amazon, Alphabet and Meta Platforms. Due to their already large market capitalisations, given their substantial returns, we estimate they have contributed >95% of the S&P 500’s FY24 return.

S&P 500 vs. Magnificent 7 - FY24 Share Price Return

While this may seem like a bubble, we believe it is in fact hard to justify current prices as such when we look at the current earnings and EPS% growth of each of these businesses. As an example, NVIDIA has a P/E of 50x, but its forecasted EPS is expected to grow ~120% for CY24, which will see the P/E halve. For Meta, the current P/E is 25x, with forecasted CY24 EPS growth of +30%. When you then overlay the average market capitalisations of the Magnificent 7 of $2.2 trillion with their average cash balances of US$32.3 billion, you can argue the current valuations are justifiable. The trends these businesses are exposed to are high growth in nature, generally scalable (globally) and have a market dominance that gives them a high level of pricing power. All these characteristics are very hard to find in one business, let alone seven.

EPS Growth Expectations – Magnificent 7 vs. S&P 500

So, what does all of this mean for investing in emerging companies, especially those outside the resources and technology sectors? The answer is not simple. In very basic terms, investment in such businesses needs to be attractive relative to all other investment options. In a world where we have mega-tech businesses, significant expansion of private credit (non-bank lending) and more speculative investments such as venture capital, various options are available to all investors.

For investors in emerging companies, returns are driven by three key outputs:

• earnings per share;
• the valuation multiple applied to these earnings; and
• dividends.

If an emerging company is unable to grow its earnings at a reasonable rate, then the valuation multiple applied by investors to these earnings will reduce. For example, if earnings remain flat, and the P/E multiple falls from 12x to 9x, this will lead to a 25% reduction in share price. Investors will then be reliant on dividend yields for any return.

In the current environment, many investors focus on short-term news flow and extrapolate these findings. For many businesses with cyclical attributes this had led to significant downside share price movements. I would argue this becomes self-fulfilling, as falling share prices result in smaller market capitalisations and often reduced liquidity, as investors move up the liquidity curve. This in turn makes it less attractive for the company to remain a listed business as the valuation premium reduces (or evaporates), leading to an inability to raise funds and further reduced liquidity for shareholders.

At NAOS, we continue to believe that investing in emerging companies that have a clear moat, are run by proven and aligned management teams, coupled with a long runway of growth in favourable industries, will ultimately yield strong long-term results. Economic cycles will impact earnings in the short term, but in our view, it is important to remember many large and successful businesses, such as Reece Ltd (ASX: REH), have experienced periods where their share price flatlines or even falls (especially in their early years). Acquiring shares in times such as these can yield tremendous results and we would argue such opportunities exist today.

Events of Significance for Investee Companies in FY24

Given the FY24 Investment Portfolio performance, it is easy to assume there were no significant events that may lead to strong shareholders returns in the upcoming year. However, in our view, there were a number of notable events that could shape the respective businesses for many years to come. They have not yet led to a change in the share prices of these investments, mainly due to their minimal impact on short-term profitability, but in our view a significant potential upside exists.

Big River Industries (ASX: BRI)

Acquisition of Specialised Laminators

During FY24 BRI announced the acquisition of Specialised Laminators (SL), a distributor and manufacturer of specialised panels mainly for use in a commercial environment, which has been operating since 1977. The business was acquired for an initial payment of $10 million, split 70/30 between cash and BRI scrip. Using a crude 10% EBITDA margin against its $27 million of revenue implies the business is being acquired on an EBITDA multiple of 3.70x. This was the first acquisition completed by new CEO, John Lorente, and in our view highlights one of the key attributes of our BRI investment thesis; namely, the opportunity for consolidation in a highly fragmented market that is dominated by baby boomers with limited succession options.

We believe this acquisition has a high level of strategic merit for BRI. The products distributed and, in some cases, manufactured by SL are of a more specialised and customised nature compared to typical laminates and veneers. The products are used in commercial applications, for example, coffins, boats, recreational vehicles and public bathrooms and amenity areas. With BRI now growing to 26 distribution sites across Australia and New Zealand, this extensive network provides SL with a unique platform to market and stock its product across the entire BRI network.

BRI’s network, predominately via its panels division, serves thousands of commercial clients and joiners/cabinet-makers, all of whom are potential customers for SL’s unique products, although they may currently be unaware of them. Additionally, BRI’s acquisition of SL enhances its capability to develop new products to meet market demands and innovate to a level where there are fewer competing products. These products can then be effectively marketed and distributed throughout BRI’s entire network, further strengthening its value proposition.

The decorative panels market in Australia and New Zealand is one that is not well understood by the wider market, and we estimate that post this acquisition, the total panels market that BRI has exposure to is worth approximately $2 billion in sales annually, comprising a mix of high-value and lower value products. The two major players in the space are the family-owned Borg, and Fletcher Building (ASX: FBU), which owns the Laminex Group. Both companies primarily focus on manufacturing rather than distribution, particularly when dealing with smaller commercial clients. BRI has the ability to cater to these smaller commercial clients, and also offer a national network with a wide range of products, including specialised veneers and panels. In our view, this gives BRI a unique moat and a long runway for growth both organically and via M&A.

MOVe Logistics (ASX/NZX: MOV)

2H Trading Update & Business Observations

Sometimes a business does not make one significant announcement that impacts the long-term investment thesis, but rather a subtle market release that suggests a pivotal moment has occurred and a business has turned a corner. In the case of MOV, this may be its update in late May, which simply stated “MOVe continues to expect 2H24 Normalised EBITDA to be ahead of 1H24”, making it the first measurement positive outcome since we became shareholders. With 1H EBITDA of just $13.2 million (and EBIT –$8.6 million), an improvement may seem like a given. The sole analyst who covers MOV has a 2H FY24 EBITDA of $15.8 million, or an improvement of ~20%, which is likely still loss-making at the EBIT line. We believe it is possible MOV may surprise slightly to the upside and deliver an EBIT result that is closer to breakeven.

Context is important when analysing the above improvement. The New Zealand economy has twice entered recession since December 2022, although the March 2024 quarter showed positive GDP of 0.2%. As a large portion of MOV’s customer-base exposure is building, construction and consumer discretionary sectors, such a weak economic backdrop is going to be extremely challenging for a logistics business with a large fixed-asset base.

So, if MOV has been able to make financial progress when the macro backdrop should have resulted in more earnings pressure over 2H FY24, it would suggest the large number of internal business improvement projects are starting to bear fruit. Some examples of these improvement initiatives include:

• Effective Sales Team/Function – Previously, we did not believe MOV had a credible sales function that was able to design and implement a sales strategy that best suited the MOV asset base and led to profitable work. Today MOV has a sales team of >15 people, and recent wins such as The Warehouse Group (NZX: WHS), suggest momentum is starting to grow.
• Legitimate Less than Container Load (LCL) Offering – Historically, MOV has been known as a traditional line-haul and full truckload business. However, it has one of the largest logistics networks in New Zealand, with a strong regional presence and warehouse offering. This positions MOV well to handle LCL freight, which can be higher margin if managed effectively while also reducing customer concentration.
• Move to Owner-Driver Model – MOV has always been an owner of all of its trucks and associated equipment, whereas in contrast Mainfreight (NZX: MFT) owns very few, if any, trucks and uses an owner-driver model. MOV is transitioning to this model where it makes sense, which should lead to greater efficiencies and a smaller asset base.
• Lower Repair & Maintenance (R&M) Costs – As a significant owner of trucking assets, MOV faced high ongoing R&M costs due to the sub-optimal age of many trucks. By selling older trucks, moving to an owner-driver model, and leasing company equipment with fixed-cost servicing, R&M costs should reduce significantly and align more closely with MOV’s revenue base.
• Implementation of Company Transport Management System – MOV has never had a company-wide IT system that provides real-time data useful for both the business and its customers. Basic metrics such as the average spend of a customer would be hard or impossible to gather in real time. The implementation of this system, expected to be fully operational by mid-FY25, will provide valuable insights for strategic improvements and to better understand customer needs.

FY25 will be a watershed year for MOV and its executive team. Many key strategic items should be fully implemented, and key executives will have been in their roles for a reasonable length of time. Clearly the resignation of CEO Craig Evans in July was unexpected, but we believe the executive team has the calibre to execute on the stated strategy without him at the helm. We also believe that with the improvements made to date, MOV should be able to promote or recruit a high-calibre CEO once again.

While we do not profess to be macro-economic experts, consensus expectations suggest a series of rate cuts in New Zealand starting as early as November, with a total reduction of 2.0% to 2.5% over the rate-cutting cycle. This should create a more accommodating macro environment for MOV to grow its revenue base with its overhauled go-to-market strategy. If MOV is able to successfully grow its revenue base, we expect the margin improvement to be significant over the coming years, but the business must be able to continue to weather the current extreme slowdown in New Zealand, to realise this value in years ahead.

MaxiPARTS (ASX: MXI)

Acquisition of Independant Parts

The management team of MXI continues with its strategy of providing the business with geographic reach, product diversification and financial scale, with the acquisition of Western Australia-based Independant Parts (IP). This acquisition solidifies MXI’s ambition to be one of the largest players in the aftermarket truck parts space with a nationwide presence, and in revenue terms puts it at a similar size to that of Supply Network Limited (ASX: SNL) and Bapcor’s (ASX: BAP) commercial division.

MXI paid ~$30 million for IP, which generated ~$45 million of revenue and $3.4 million of EBITDA (pre-AASB-16) in FY23. IP has four standalone branches but many more “embedded” sites. These embedded sites are essentially an IP store located within a client’s main operation. For example, a mining business that has the scale and requirement for an onsite parts provider to minimise any downtime to their mining operations. This set-up ensures a continuous supply of necessary parts, critical for mining operations. It also allows the parts provider to get a better understanding of its client’s needs on an ongoing basis, so they can ensure they always have the right parts in stock.

From our perspective, there were several positive and negative attributes of this deal.

Advantages:

• Increased WA Presence and Client Diversification – Prior to this acquisition, of all the states MXI operates in, it was weakest in Western Australia (WA). But as the acquisition of Forch has shown (>90% of its revenues were WA sourced prior to acquisition by MXI), WA is a state that has substantial demand for MXI’s products and services. The acquisition of IP now provides MXI with broader access to these markets across WA and the opportunity to expand its embedded business model. Clearly, many clients in WA operate in the resources industry, which diversifies MXI from the traditional eastern seaboard operators who rely on general logistics movement.
• Embedded Business Model – We believe that ~50% of IP’s revenue is derived from sites that are part of their embedded business model, a model MXI did not employ prior to the acquisition of IP. We would argue this embedded model provides MXI with a significant competitive advantage, allowing it to deal directly with the customer at their site, truly understand their needs, and tailor services to meet those needs. If MXI delivers high-quality service, is easy to do business with, and offers fair pricing, it becomes difficult to see MXI being displaced from these sites, especially due to the time-critical nature of many of these part requirements. Furthermore, this successful embedded business model in WA could potentially be replicated on the east coast, providing MXI with valuable optionality.
• Core Business Growth and Margin Expansion – As both margin and revenue growth formed the core part of our original investment thesis, it was pleasing to see MXI continue to grow revenue as well as margins. The increasing demand for non-genuine truck parts, as customers recognise the benefits of non-OEM products, plays a significant part in MXI’s top line growth. Additionally, compared to its closest listed peer, Supply Network Limited (ASX: SNL), the EBITDA margin differential is >8%. Although a number of variables mean this is not an “apples to apples” comparison, regardless we believe MXI has the opportunity for this margin profile differential to materially reduce over time.

Disadvantages:

• Sophisticated Vendor, Price Paid and Deal Structure – The IP business was previously majority owned by a WA-based private equity firm. Sceptics will argue such an investor/owner would have ensured that the earnings potential of the business was maximised prior to sale. The fact MXI paid 100% cash for the business also lends to the argument MXI may have paid a full price with minimal protection if the forward earnings do not grow as expected. We should point out that during the trading update provided in May 2024, management flagged that “the trading results for IP are tracking in line with expectations, with the WA market still remaining buoyant”, so while we have high expectations for the newly acquired business, it will be a focal point during the FY24 results.
• Equity Raising – An attribute that first attracted us to MXI was the significant free cash-flow generation, driven in part by strong gross cash-flow conversion, minimal capex and approximately three years of income tax losses. As such, we found it a little disappointing that MXI’s board opted to fund the acquisitions with a $17.2 million placement (with no access to retail investors) at a 10% discount to the last share price. Looking forward, assuming management continues to execute as it has done so previously, we would expect the board to adopt a capital management strategy that is more aligned with MXI’s cash-flow generative nature and balance sheet strength.

MXI remains one of our highest conviction  investments held in the NSC Investment Portfolio, with Peter Loimaranta and his team doing an exceptional job in a short period of time. Despite a weaker than expected 2H FY24 from a trading perspective and some missteps in guiding the market regarding cost increases associated with new leases, MXI operates in an industry with strong long-term fundamentals and has significant opportunity to increase its margins over time.

FY25 Outlook

There is no doubt that being an index-unaware, active manager with a focus on emerging companies has never been more challenging. Despite this, we fundamentally believe and remain steadfast in the belief that investing in emerging companies, with a long-term and concentrated portfolio structure, can lead to substantial positive returns.

I would argue the current share prices applied to most, if not all of our core listed investments factor in no earnings growth or even negative growth over the long term. However, as history has shown us, extrapolating a current earnings profile can prove to be a misguided approach, when earnings are either depressed (and also valued on low earnings multiples) or at inflated levels (and also trading on lofty earnings multiples). This can explain why large amounts of variability can occur for a company’s share price over time.

In our view, three key factors will dictate the returns of the NSC Investment Portfolio over the next few years.

Firstly, economic conditions will change, and these changes may have significant impacts on some of our key investments, such as Big River Industries (ASX: BRI), COG Financial Services (ASX: COG) and MOVe Logistics (ASX/NZX: MOV). It may sound simplistic but for businesses such as BRI and MOV, the leverage to revenue growth is significant due to their respective fixed-cost bases. BRI’s ~40% exposure to residential construction is key, and with new housing approvals at very modest levels even in the face of government stimulus and a critical housing shortage, this provides a significant headwind for BRI. However, as activity starts to improve, we expect BRI to be a significant beneficiary.

For MOV, you will not find many businesses more correlated to economic activity. Many of their clients require their products to be transported all over New Zealand, but as their sales volumes fall, so do their transport needs, even for staple products. As the economy recovers from recession, increased movement and activity should benefit MOV significantly, especially as the company becomes more efficient and effective.

As the largest aggregator of asset finance, and a notable provider of novated leases, COG stands to benefit as businesses regain confidence and seek finance to fund their growth initiatives in a timely manner. As economic conditions improve, businesses tend to be less focused on the price of this finance, and more on the whole service offering. This backdrop should be more amenable for COG to grow its earnings organically.

Secondly, businesses will need to continually innovate and refine their strategies to ensure they meet their customers’ changing needs, and we are confident our investments are nimble enough to execute successfully in this regard. We also do not believe that many of our businesses reacted as effectively as they could have in 2H FY24 from an efficiency perspective. In FY25, they will need to ensure they are being as efficient as possible to maximise the value of their asset base, particularly if cost rationalisation activities have occurred in response to the more challenging economic climate of late.

Thirdly, as listed companies they also have the clear advantage over their private counterparts in being able to use their listed scrip to acquire businesses that bring with them a compelling strategic offering. Potential opportunities for strategic M&A activity are also likely to increase given the depressed valuations across many emerging companies.

There is no doubt that the above factors come with a significant amount of execution risk. However, due to the recent investor exodus from emerging companies, in our view the valuation multiples currently applied to many emerging companies have not been as depressed for 10 or even 20 years. Consequently, when these businesses grow their earnings base at a rate even slightly above market expectations (e.g. >5%), we would argue the re-rating of these businesses has the potential to be significant. As we have seen over the past 12 to 24 months, when a listed business remains undervalued over a significant timeframe, then there is a real possibility the company will be acquired and delisted. In 2024 alone, within the building materials sector, three of the largest listed businesses saw takeovers, namely Boral (ASX: BLD), Adelaide Brighton (ASX: ABC) and CSR Limited (ASX: CSR), all of which had been listed since the 1960s.

We also believe that in most cases the people who run our core investments are highly aligned, highly motivated and highly capable. This also gives us great confidence the strategies are being implemented with strong fundamentals behind them and a high level of energy to achieve the outcomes in a desirable timeframe. While some may argue executives/management teams have a poor ability to judge what fair value is for their respective businesses, we would argue these same people have a deep understanding of the long-term strategic value of their respective businesses.

In conclusion, we are striving for improved returns following the recent unsatisfactory performance. We take full responsibility for these results and remain committed to restoring value and delivering long-term performance.

My fellow NSC Directors and I continue to increase our shareholdings, and NAOS has also recently committed to reinvest up to 15% of its annual management fee into acquiring NSC shares on-market.

The entire team at NAOS is acutely aware of the trust you have placed in us to manage your capital and we greatly appreciate your ongoing support.

If shareholders have any questions, please do not hesitate to contact me directly.

Kind regards,

Sebastian Evans
Managing Director and Chief Investment Officer
NAOS Asset Management Limited 

What are Big River Industries’ current initiatives regarding sustainable forestry practices?

At Big River, we are dedicated to ensuring our timber products meet the highest standards of sustainable forestry practices. By partnering with leading global producers and supplier partners who are certified to internationally recognised forestry standards, including the Forest Stewardship Council (FSC), the Australian Forestry Standard (AFS), and the Program for Endorsement of Forest Certification (PEFC), we guarantee responsible tree harvesting with no net forest loss over time; the preservation of forests with irreplaceable values; the protection of plant and animal species; and engagement with local communities, respecting their legal and cultural rights to land and forest resources.

What strategies has Big River Industries implemented to minimise waste and maximise the reuse of timber products throughout their lifecycle?

Our commitment to sustainability is reflected through our ongoing initiatives aimed at enhancing sustainable forestry practices. One notable example is the recent upgrade of our Grafton Plywood facility, which now produces an increased percentage of higher value architectural products with longer product life cycles, contributing to extended carbon sequestration. Furthermore, we are consolidating and standardising our sustainable forestry processes and certifications, to implement best practices across our entire business.

Big River is focused on optimising productivity, enhancing product performance, and reusing materials to minimise environmental impact. In our production facilities, yield management is crucial for productivity, cost control, and waste minimisation. For example, our four frame and truss manufacturing facilities use advanced sawing technology to optimise timber cutting, maximising material usage and reducing waste. Alongside this, product design plays an important role, with our Australian-made formply products (Armourform) designed for maximum reuse, achieving high total-value extraction. We have also established reuse and recycle streams through partnerships with Men’s Shed, school programs, and resource-sharing platforms like CivilShare in New Zealand.

Can you discuss any partnerships or collaborations that Big River Industries has engaged in to enhance sustainability practices within the timber industry?

In line with our recent upgrade at the Grafton site, we collaborated closely with forestry stakeholders to enhance the site’s capability to process lower quality and smaller diameter logs, supporting more sustainable forestry practices. We continue to explore partnerships with industry bodies to investigate alternative sources of fibre and other sustainable substitutes, aiming to reduce reliance on more carbon-intensive options.

Does Big River Industries have key targets or milestones specifically related to renewable forests and recycling?

In 2020, our New Zealand panels business, Plytech, launched “Plytech Green,” an initiative highlighting our commitment to environmental and social sustainability. This initiative introduced a new naturally derived lignin-based glue system, significantly reducing the environmental impact of a third of our products sourced from Europe.

The glue system replaces fossil phenol with bio-based lignin – a recyclable and ecologically friendly product. It is a wood-based, non-toxic material from a managed resource, which can be sustainably sourced. This product reduces the use of volatile organic compounds (VOC) and formaldehyde emissions, from production to end-use.

Big River remains steadfast in our commitment to sustainable practices, continuously striving to balance environmental conservation with responsible forestry management.

Looking ahead, Big River is targeting a reduced carbon footprint by increasing our exposure to environmentally positive products and services. We are committed to sourcing from the most recognised sustainable sources, and promoting timber as a sustainable material capable of removing and storing greenhouse gases.