would now like to hand the conference over to Mr.
Hugh Killen, Managing Director and Chief Executive Officer. Please go ahead.
Good morning, and thanks for joining us to discuss AA Co's full year results for financial year 2021. I'm Hugh Killam, Managing Director and CEO of AECO. And with me today is our Chief Financial Officer, Nigel Simmons. I'm going to start by taking you through some of our key outcomes across our full year performance. I then want to go through the progress we've made in FY 2021.
I'll provide a commercial overview and drill down into how our brands are driving progress. And we'll then have a look at how this is playing out by region around the world. I will hand over to Nigel to take us through the financials in more detail and I'll finish with an update on our operating environment as we move into FY 2022. Let's turn now to the executive summary on slide number 4. I'm pleased to report that we've consolidated our first half performance across the full year.
FY 2021 has been dominated by uncertainty across many industries. In particular, food services face ongoing disruption across our key markets around the world. These risks continue despite progress in virus suppression and vaccination in parts of the world. In FY 2021, our commitment to a simpler and more efficient AATO has been critical to navigating this uncertainty. This has helped us improve operating profit and statutory EBITDA in FY 2021 compared to FY 2020.
And we've been able to deliver a positive operating cash flow result. Our strong brand portfolio and distribution partnerships have also helped us connect with new customers and respond to changes in our markets. Overall, this has helped improve our average price per kilo. And this has been driven by increasing proportion of meat sold through our West Home and Darling Downs brands. The enduring value of our underlying assets has also delivered important stability through this period.
We continue to see strong improvement in our property values, which can continue to strengthen over the longer term. And this has translated into a solid increase in the net tangible asset value of the business. Turning to Slide 5. External forces in recent years continue to impact our results. Australia's overall cattle herd has declined in response to successive drought and flood challenges.
This is reflected in a marginally lower A acre herd size in FY 2021. While drought conditions have been eased, we continue to see below average rainfalls across our properties. And 3 years on from the devastating Gulf floods, our properties there are still recovering with limited pasture response. One of the consequences of these seasonal impacts is lower calving rates. These take time to flow through our supply chain before impacting mature animal numbers.
In FY 2021, our lower calving rates over the last 3 years have resulted in reduced overall meat production volumes. And lower volumes have primarily driven a 21% or $68,600,000 decline in FY 2021 revenue compared to FY 2022. Lower volumes are expected to remain into FY 2022. Importantly, our herd rebuild has commenced with a 47% increase in carbs in FY 2021 compared to the prior year. As this rebuild flows through our supply chain, we are likely to continue with some supplemental cattle purchases.
More broadly, the uncertainty which has impacted FY 2021 is likely to continue through FY 2022. We will continue to monitor and adjust the changes in our markets and in the wider economy. In this context, the key drivers of shareholder value at Aaco remain strong brands supported by simpler and more efficient business. Turning now to slide 6 and progress made in a challenging year. I want to go into more detail about these key value drivers and the progress we've made in FY 2021.
The pillars for our business remain our values, our team, our operations, our focus on customers and consumers and respecting what makes it possible. The key elements of our strategy remain connecting with our customers and consumers by strengthening our brand portfolio, delivering for our customers by building the best routes to market maximizing revenue through strategic growth and investment getting the most out of our assets and operations to optimize the value of every part of our business investing in AA Co's next 200 years through a company wide focus on sustainability and continuing to strengthen the AA Co team through our high performance culture. Each of these elements have been critical to helping AA Co navigate uncertainty in FY 2021. We've continued to improve product allocation across our brands and markets to secure our maximum returns. This has included further streamlining our brand portfolio.
In FY 2021, West Ham and Darling Downs represented 74% of our branded meat sales. In parallel, strength of our global distribution network has enabled us to access new retail channels and online gourmet marketplaces. This has been vital to connecting with new customers despite the impact of COVID-nineteen on foodservice and international travel. And we have strengthened our talent and leadership capability in key functional roles across the business to keep supporting our branded based strategy. As a result of this work, we've driven an 8% improvement in overall price per kilo.
We've generated $76,000,000 in reduced operating expenditure compared to FY 2020. And we have progressed our sustainability agenda in FY 2021, including launching our beef cattle herd management carbon projects. Turning now to Slide number 7. Through the challenges of FY 'twenty one, we're focused on maximizing returns from every cut of meat we produce. This means ensuring the right cuts are available for the right market opportunities at the right time.
This strategic market allocation has helped drive an 8% improvement in price per kilo compared to FY 'twenty. In particular, we are focused on adapting to increasing at home consumption and the rise of the home chef including partnering with gourmet marketplaces and premium retail specialists. Targeted digital marketing campaigns and improved product branding on menus and also in store. An increase in the proportion of AA Co product moving through West Home and Darling Downs to 74% of all branded base sales. Today 80% of our higher value loin rump cuts are sold under our West Home and Darling Downs brands.
This is important because West Home and Darling Downs have together achieved annualized price per kilo growth of 17% since FY 2019. And this has underpinned our overall annualized price per kilo growth of 8% over the same period. In addition to West Ham and Darling Downs, our Wallara brand focuses on the top on the world's top fine dining restaurants. This market has been directly impacted by COVID-nineteen in FY 'twenty one. Wallara remains a key strategic priority for AOCO as the foodservice sector begins to rebuild.
Getting maximum price per kilo has been even more important in FY 2021 as we face headwinds impacting overall meat volumes. The average F1 wager life cycle is long at 3.5 years from conception and birth through to meat production. This means that when flat and drought impact our calving rates, this takes time to flow through to reduce meat production volumes. In FY 2021, we really began to feel the effects of successive years of drought and the flood on calving rates, with overall meat sales volume down 19% compared to FY 2020. Securing premium prices for product through our quality brands is even more important under these circumstances.
Moving on to slide 8. On this next slide, I want to explore the benefits of branded beef sales a little more and discuss what this means to AYCO moving forward. As a general rule, 15% to 20% of meat from an animal is a high quality loins and rums category. These cuts can be sold at a premium price through strong brands like West Home and Darling Downs. Since 2019, Aaco's price per kilo for loins and runts has improved 10% each year on a compound basis.
And in FY 2021, 80% of Ayako loins and rums are sold under West Home and Darling Downs. Further down the carcass, 35% to 45% of meat fits into the barbecue and secondary cut category. So far, 63% of Ayako's barbecue and secondary cuts are sold under brands. 59% of barbecue cuts are now sold under Darling Downs and 55% of secondary cuts go into branded sales. AYATO has achieved 7% annual compound growth in price per kilo for barbecue and secondary cuts since 2019.
And we'll continue to increase the proportion of these cuts sold through branded channels. The remaining 35% to 40% of meat producers in the trim category. At present, the vast majority of trim is sold as a commodity with little product innovation or added brand value. This suggests there's potential to improve value derived from this category. And this is an area of potential growth, which we'll be exploring in the future.
Turning now to slide number 9. You can see how important our brands are to realizing the value of the beef we produce. I want to delve a little deeper into how we have built the value of our West Home and Darling Downs brands in FY 2021. As mentioned above, West Home has grown from 11% of our overall meat sales to 25% in FY 2021. The team has worked hard to build brand equity and drive awareness particularly in key markets in the U.
S. As you can see, Westside more than tripled its following on Instagram this year with the majority of the audience been in the U. S. And in the year just gone, we launched our 1st paid digital marketing campaign in partnership with chefs in Australia and also the U. S.
We've also pursued new direct to consumer channels during COVID-nineteen. We've made West Home available via the Gold Belly online gourmet marketplace in the U. S. And in FY 2021, we partnered with Gold Belly to create online brand content, including using Gold Belly influences to engage customers. Jumping now to slide 10.
In FY 2021, we've seen the results of the work I discussed last year to refresh our brand in Korea. The team have rolled out new packaging and in store activation across all 141 E Mart stores in South Korea. We still supported this with a digital campaign to improve brand awareness with really significant results. And we've seen higher average consumer sales prices in FY 2021. As we build the value of these brands and deliver more products through them, we will realize more value for our investors.
And this is particularly important in the face of market uncertainty and headwinds in our wider industry. Turning now to slide number 11. Through FY 2021, this approach has driven positive outcomes across all our regions with the exceptions of China, Europe and the Middle East. In North America branded beef price per kilo was up 14% compared to FY 2020. This has been driven by successful growth into retail channels during COVID-nineteen.
As discussed above, the U. S. Has been a major focus for digital and social campaigns to drive brand awareness around West Home. And we continue to focus on at home chefs for meal kit product innovations and online marketplace partnerships, including with high profile shares. In FY 2021, we sold 19% of A8O meat in North America compared to 7% in FY 2020.
In Asia, we achieved 5% improvement in price per kilo compared to FY 2020. This was driven primarily by the strength of our Darling Downs brand presence in Korea. Strong distributor relationships in other markets continue to support sales. We continue to respond to uncertainty in the Chinese market, which has been traditional destination for Aaco's trim product. To date, we've been effective in redistributing retail product to other markets, and we'll continue to explore these opportunities.
You can see the proportion of AOCO products sold in China decreased in FY 2021, offset by growth in the rest of Asia and also in North America. In Australia, we achieved a similar 5% improvement in bus per kilo compared to FY 2020. This driver has been continued improvements in our market allocation and mix. This has involved focusing on high quality branded products for the Australian market and reallocating other products to high value markets around the world. We continue to refine and build the value of our quality brands in Australia.
This is important for the Australian market, but also because Australia is AAK's spiritual home. Our brand and success in this market is the core objective of our global branded beef strategy. In Europe and the Middle East, AYOKO sales directly felt the impact of COVID-nineteen on foodservice in FY 2021. Our major retail focus in the last year has been in Asia and North America. This has resulted in the drop in the proportion of AOCO meat sales going through to Europe.
We'll continue to monitor foodservice opportunities in the region and we are looking forward to the conclusion of free trade negotiations with the U. K. With that, I'll now hand over to our CFO, Michael Simmons, who will take you through the financials in some more detail.
Thank you, and good morning, everyone. And thank you all for your interest in what has been a year of resilience in the face of significant disruption and uncertainty across our key markets. I will now take you through the financial highlights and provide some additional context. I can report that we have consolidated our good first half performance through the full year. And in the full year just gone, AAICO delivered positive operating profit and cash flow.
This is significant given the continuing impacts of COVID-nineteen and the impact of recent drought and flood events on overall meat volumes. Our improved operating profit result reflects ongoing progress against our strategy. And of note, we have realized an 8% improvement in price per kilo, which reflects continued growth in our brand value. This improvement was offset by 19% lower meat volume available for sale in FY 2021 compared to the prior year. And we have also achieved a reduction in expenditure of approximately $76,000,000 which includes $29,000,000 of reduced adverse seasonal costs, dollars 24,000,000 of lower external backgrounding, external feedlot and processing costs as a result of lower volumes, and further significant cost savings realized across the business.
Our progress has been supported by our strong balance sheet. Our net assets position remains strong, driving significant improvement in net tangible asset value per share. And AECO's gearing ratio remains well within our covenants, improving 3.1% year on year. We achieved a statutory EBITDA result of $99,300,000 and an improved statutory profit of $45,500,000 up from $31,300,000 in FY 2020. And now moving on to our profit and loss statement on slide 14.
Firstly, in regard to revenue, you can see an overall decrease of $68,600,000 compared to the prior year, which includes a CAD 29,600,000 decrease in total meat sales in FY 2021. This reflects a 19% drop in meat volume available for sale, which is the result of lower calving in response to recent drought and flood events, which has started to flow through to meet production levels. In this context, Aaco's overall 8% improvement in price per kilo has been very important to our end of year position. This has allowed the company to report a positive operating profit of $24,400,000 in FY 2021 and $17,700,000 excluding JobKeeper. AACo's cattle sales volume was lower in FY 2021 compared to the prior year.
This reflects elevated cattle sales last year as a strategic response to drought conditions. And these lower sales volumes were offset by higher prices in the market. On the cost side, we have seen the positive effects of our disciplined approach to operating expenditure as well as more favorable seasonal conditions. This has resulted in a combined $76,000,000 reduction in expenditure overall. And as noted earlier, in part, this is a result of streamlining costs across the supply chain, including backgrounding, feeding, cattle transport and processing.
We've also had an unrealized fair value gain of $64,300,000 this year versus $49,600,000 last year. The gain in FY 2021 was driven mainly by a $91,000,000 increase in cattle values off the back of record prices in the Australian cattle market. And this was offset by lower overall kilograms produced as our herd enters the rebuild phase. Turning now to our next slide, where we detail our positive cash flow results. In all, AECO achieved $18,400,000 in operating cash flow compared to $20,100,000 in the prior year.
And our FY 2021 result was $11,700,000 excluding JobKeeper. The key drivers of these results have been better revenue management through strategic market allocation, in turn driving higher prices, continued focus on costs across the supply chain and progress towards a simpler and more efficient AA code right across the business. You will also see on this slide a $33,800,000 reduction year on year in net financing cash flow. This reflects a deliberate strategy to optimize finance cost payable with no impact on total available borrowing capacity. And now turning to slide 16 and our balance sheet.
AECO ended FY 2021 with a very strong balance sheet position, including over $1,000,000,000 in net assets. This is underpinned by strong growth in the value of our land and herd. Wider market forces have driven higher lost livestock prices in the short term with positive impacts on rural land values as well. But Aaco's overall strategy has been critical in growing the value of these assets over time. This strong balance sheet position means AECO retains comfortable headroom in our existing bank covenants, and this includes approximately $185,000,000 in available borrowing capacity across our debt facilities.
And our gearing ratios remain well within our target range. And with that, I'll now hand back to Hugh.
Thanks, Nigel. On slide 18, as a nearly 200 year old pass through business, sustainability is at the core of what we do at AA Co. This year, we made progress on our sustainability agenda, including greenhouse gas abatement under our Beef Cattle Herd Management Carbon Project. This project is formally registered with the Australian Clean Energy Regulator. Our main focus is improving animal productivity to reduce lifetime emissions by improving how we breed, raise and handle our cattle.
We've identified core activities to drive carbon abatement under this project including improving animal conversion through genomic selection, increasing grazing areas through improved water access points, better pasture control through fencing infrastructure and reduced cattle handling through improved yard infrastructure. This work aligns with AOCO's Animal Health and Welfare Committee, which we also launched in FY 2021, as well as ongoing progress on our poll program. And in parallel, we're also reducing our reliance on fossil fuels. This includes more than doubling the number of solar powered bores on our properties. There's more to come in this space for 8AK, And we look forward to talking more about this work in our 2nd sustainability benchmarking report, which will be released later this year.
Turning now to slide 19 and changing consumer dynamics impacting our business. As we've talked about previously, long term growth in the global middle class is driving sustainable demand for quality beef. This includes the continued focus on provenance and traceability. More recently, COVID-nineteen has precipitated growth in the home chef market, bringing high quality branded beef into the home. Direct to consumer channels are also growing through digital platforms, virtual booking classes and restaurant quality meal kits.
These consumer trends are likely to continue during COVID-nineteen and also beyond. The vaccine rollout is also continuing around the world and we are watching the impact this is having on the foodservice market. At the same time, geopolitical uncertainty remains a feature of our market and this includes Chinese processing restrictions impacting these sales. We'll continue to monitor these changes as they roll out in FY 2022 and beyond. Within this context, global beef demand remains robust and the long term outlook is largely positive.
Population growth and rising household wealth are forecast to continue particularly in Asia. In 2021, beef exports are forecast to grow by 2% to 11,100,000 tonnes following declines in 2020. This includes growth in Brazil, India and the U. S, which will offset declines in Argentina, Australia and New Zealand. And this has been driven in part by Chinese demand, where the ongoing impact of African swine fever continues to drive imports.
Beyond 2021, cyclical forces in the U. S. And Brazil are likely to limit growth in production and export, as those herds move into a rebuild phase. We expect sustainable consumers demand will continue to grow. There will be there will continue to be a premium on provenance, traceability, quality and product innovation.
Australian producers will be well positioned as our local herd rebuilding progresses. Within this context, the cattle industry in Australia is facing a unique set of challenges and also opportunities. Our national herd contracted in 2020 to the lowest level in 25 years. Evidence suggests we have turned the corner and the national herd is now expected to grow by 5% in 2021. As producers look to retain their herd in better seasonal conditions, cattle slaughter levels are forecast to reach 36 year lows in 2021.
These slaughter rates are not expected to return to average levels until 2023. In April, we saw these supply constraints drive the equity above $900 per kilo for the first time in history. And upward pressure on prices was likely to continue as Florida rates returned to average levels. Looking forward, external forces will continue to impact AOK's overall meat production volumes in FY 'twenty two. This will be in the back of the 19% lower meat sales volumes achieved in FY 'twenty one compared to FY 'twenty.
On the other hand, we're already seeing a rebound in carding rates, which jumped 47% in FY 'twenty one compared to FY 'twenty. And if we manage its herd rebuild, AOK will conduct some supplemental cattle purchases. As always, we'll focus on improving our genetics as well as our land and animal management as we rebuild our herd. To finish, I want to commend the AOK team for the results they have achieved in a really uncertain environment in FY 2021. We have faced lower calving rates between 2018 all the way through to 2020 in response to drought and flood events and in line with the wider industry.
These headwinds have started to impact our meat production in FY 2021 due to our average F1 Wagyu life cycle mix of 3.5 years. This has driven a 19% decline in meat volumes for sale compared to the prior year with consequent impacts on revenue. These lower volumes are expected to continue into FY 2022. Our herd rebuild has begun with a 47% increase in calving rates in FY 2021 compared to FY 2020. We've made important progress in FY 2021 in the face of significant disruption to the food service food service sector.
This is reflected in our strong price per kilo and our continued transition to high value brand sales. This progress puts us in a good position to drive more brand value benefits across more of our cuts and categories. Our strong balance sheet and positive full year results give us a solid platform, and we'll continue to focus on cost discipline and unlocking value across our entire supply chain. Overall consumer demand for beef remains strong. This is why it should continue to grow over short to medium term.
We'll continue to monitor market conditions and consumer trends on the ground. But our progress to date gives us confidence that Aeaco has a strong position to benefit from changing consumer demand and keep driving value for our shareholders. That ends our presentation. I'd like to thank you all for your time and Nigel and I are happy to take any questions.
Thank Your first question is a webcast question from David Fawcett with 10 World Party Limited. Please read, With Argentina banning beef exports for 30 days, what will this do to world markets and particularly AAC?
So I was trying to get some context around that in my prepared remarks. I think the Argentina situation is an interesting one. We've seen immediate moves in especially in the trim complex prices moved higher overnight. I think if I take a step back and look at where we're at from an Australian perspective, obviously, we're in the herd rebuild here. And so supply through the processing is extremely challenged.
And that will continue for a while longer. We've seen Brazil in particular killing 1.5 times its normal kill, so they've gone heavily into their cattle herd as well. And now we're seeing Argentina have significant issues with internal supply and food inflation going to an election year in Argentina. So I think these are all really positive aspects in terms of outlook for pricing in global red meat. The U.
S. On the other hand has been actually in a cold phase because they're going through quite a significant drought there and they've been killing off their herd at a very high rate, which has resulted in very good profits for processes over there. But there is forecast to be a break in the season there. So you could actually see a turnaround in those dynamics in the U. S.
As well. So when I put all of those together, including Argentina and the demand that we're seeing for red meat globally, in particular out of China, which has significant issues with ASF as we've talked about, I think there is a chance to see continued move higher in global red meat globally over the next 6 months.
Thank you. Your next question comes from Rodney Rodwell with Obin Rumford and reads, I get the feeling we sell all the products we produce and so increasing our market penetration adds little until we produce more. Is this true?
So demand for our product is extremely high, Rodney. And as I've been trying to explain in the remarks today, we will have lower supply as the impacts of the drought and the flood run through our system. So for us, the important thing is making sure we're getting the right price for every kilo of meat we sell, make sure we get our market allocation and our market mix absolutely correct, which is what we've been doing, which is why we've been able to grow our brand margins by our brand revenue by 17% this year. And I think there is no further opportunity for us to do that even in the environment where we have lower supply coming through. And I talked about value added product in our trim categories for instance and the opportunity to do more there.
So while there is more demand than we have from a supply perspective and that's obviously a good thing, there is opportunity for us in terms of our businesses and our brands to make sure we get our allocation, our mix even better than it is now and hopefully can drive prices higher as a result.
Thank you. Your next question comes from Phil Dunn with Dunn Holdings and reads, does AA Co offer direct online meat sales into Sydney? If not, who supplies this consumer market?
Phil, I get asked this question a lot. And one of the benefits I think of COVID-nineteen is you can actually get restaurant based more easily in other markets. So in Sydney in particular you can go to Havrick's meat and they've got an online marketplace and you can get Aaco product there or you can go into their shop and buy from them directly in a portion of food for you there. So there's a number of areas we can get it. Obviously, direct to consumer and online is an area that we're focusing in strongly, not just in Sydney, but more broadly as well.
And that will be an area for us to continue to think about and try and approach maybe in a different way going forward. And I've talked about this at the half year as well. There's an online marketplace in the U. S. As an example called Goldbelly, which is an example of where we're actually going direct to consumer.
Thank you.