Good morning, ladies and gentlemen. On behalf of your Directors, welcome to the GUD Holdings Limited AGM for the year 2021. My name is Graeme Billings, Chairman of your Board of Directors, and with me today is our Managing Director and Chief Executive Officer, Mr. Graeme Whickman. Graeme and I are hosting this virtual AGM from the company's head office in Altona North, Melbourne. I'd like to begin by acknowledging the traditional owners of the land on which we meet today, the Wurundjeri Woi Wurrung People of the Kulin Nation, and pay my respects to elders past, present, and emerging. The Company Secretary has advised me. I declare a quorum is present and open the 64th AGM of GUD Holdings Limited.
The Notice of Meeting was distributed to all shareholders in excess of 28 days ago, along with the company's AGM Annual Report for the year ended 30 June 2021. With your consent, I will take it as read. Ladies and gentlemen, we meet again in a manner unusual for most of us due to the prolonged and challenging circumstances of the COVID-19 pandemic. The virus continues to have considerable and distressing impact on all our lives. We have hope that with the vaccine rollouts, we may soon begin to live an almost normal life. This is the second virtual AGM of the company. By reason of the travel restrictions currently in place, in particular in Victoria, your Board is not assembled in the one place, and of course, we are again unable to meet and speak with each of you personally.
There are other format changes which I will speak to shortly. Firstly, please allow me to introduce your Directors. Most of your Directors are attending these proceedings just as you are, online. They will be available to answer questions you may ask. With me today is our Managing Director and CEO, Graeme Whickman. Graeme Whickman joined the Board on 1 October 2018 following his appointment as Managing Director and CEO. He will address us later in the meeting. Online is Jennifer Douglas, residing in Melbourne. Jen was appointed a Non-Executive Director on 1 March 2020, and elected by you at the AGM last year. She is an Independent Director and Chair of the Board Risk and Compliance Committee. Also online is David Robinson, based in Houston, Texas. David was appointed a Non-Executive Director on 20 December 2011.
He's also an Independent Director and is Chair of the Board Remuneration, People and Culture Committee. David will stand for re-election by shareholders later in the meeting. We have two new recently appointed Directors also online. Carole Campbell was appointed a Non-Executive Director on 16 March 2021. She is an Independent Director and Chair of the Board Audit Committee. Professor John Pollaers was appointed a Non-Executive Director on 23 June 2021. He's an Independent Director. In accordance with the law and our constitution, both Carole and John will be standing for election as a Director by the shareholders later in the meeting. I will invite both Carole and John to address you when standing for election. We also have present online Martin Fraser, CFO, and our Company Secretary, Malcolm Tyler. Chris Sargent of KPMG, the company's Auditors, is also online present at this meeting.
KPMG have been our audit firm since the 2007 financial year. There is a rotation of audit partner every five years. As a result, Chris Sargent completed his fifth and final year as audit partner in the 2021 financial year. Thank you very much, Chris. Maritza Araneda takes over as audit signing partner from the close of this meeting. I welcome Maritza. Before we begin with the formal Business of the Meeting, I would like to make you aware of some housekeeping matters. Only shareholders and proxies have the ability to ask questions and submit votes. In about 30 minutes, after myself and Graeme have addressed the meeting, we will turn to the Business of the Meeting.
At that time, we look forward to taking your questions using either the Questions tab on the Lumi app or by phone using the number provided in your Notice of Meeting. If you choose to ask your question by phone, please have your details ready to supply to the operator to verify you as a shareholder. You will need your name, the entity holding the shares, if applicable, and your SRN/HIN. While you are on the phone waiting to speak, you'll be able to hear the live meeting audio while you're on hold. Therefore, you won't miss any of the meeting during your call. I will provide more specific advice on the Q&A as we get to it, but you can ask your written questions any time from now on. To ask a question in the Lumi app, press on the speech bubble icon.
This will open a new screen. At the bottom of that screen, there's a section for you to type your question. Once you have finished typing, please hit the arrow symbol to send. Please note that while you can submit questions from now on, I will not address them until the relevant time in the meeting, either when the particular item of business is open for discussion or after the close of business, but before the close of the voting polls. I ask that in the interest of time, and in order to allow as many questions to be addressed as possible, please try to keep your questions to a moderate length. Please also note that your questions may be moderated, or if we receive multiple questions on one topic, amalgamated together.
Finally, due to time constraints, we may run out of time to answer all your questions. If this happens, we will answer them in due course via email or via posting responses to our website. If you're asking verbal questions by phone, in the interest of all shareholders present, I ask that you ask only one question at a time. Keep your questions and comments to no more than two minutes to allow as many shareholders as possible to speak, and confine your questions to this particular item of business and matters relevant to shareholders as a whole. If your question or comment relates to another item on the agenda, please wait and raise it when we come to that item of business later in the meeting. Now, a word on voting.
In accordance with current practice, voting today will be conducted by way of a poll on all items of business. Voting on every resolution is held over until the end of the meeting. However, in order to provide you with enough time to vote, I will shortly open voting for all resolutions. At that time, if you're eligible to vote at this meeting, a new polling icon will appear. Selecting this icon will bring up a list of resolutions and present you with voting options. To cast your vote, simply select one of the options. There is no need to hit a Submit or Enter button as the vote is automatically recorded. You have the ability to change your vote up until the time I declare voting closed.
In the unlikely event that we experience a loss of signal with the webcast, please do not log out of your Lumi app. We have a backup webcast stream running which will automatically appear in your Lumi app within about 30 seconds of the initial loss of signal. This will restore your video, audio, and slides of the meeting. Fingers crossed. I now declare voting open on all items of business. The polling icon will soon appear. Please submit your votes at any time. I'll give you a warning before I move to close voting. I advise shareholders that the status of proxies on each item of business will be shown on the screen as we address each item in turn.
To the extent that there are open proxies available to be voted by me on any item, I advise the meeting that I will vote them for each of those items on the agenda. The Board unanimously recommends that you vote in favour of all resolutions. This meeting is being webcast live today to shareholders, staff, and other stakeholders of GUD Holdings Limited. At the conclusion of this meeting, an on-demand version will be available on the company's website for playback to interested parties who could not be available for the live stream. Today's proceedings will commence with my address to shareholders. A copy of my address will be available later today on the ASX and on the company's website. Following my address, I will ask our Managing Director and CEO, Graeme Whickman, to address you on key operational and financial highlights and provide commentary on the business.
We will then turn to the formal Business of the Meeting, including consideration of the financial statements and reports, the election or re-election of three Directors, the approval of the remuneration report, the special Business of the Meeting, which includes the grant of performance share rights under the company's long-term equity plan to the Managing Director, Graeme Whickman, and the approval of financial assistance to be provided by Australian Clutch Services Proprietary Limited, a subsidiary acquired earlier this year. Ladies and gentlemen, my address to you today covers five key topics. I will firstly speak about the importance of safety at GUD. I would then like to address the strategy, the positioning of the portfolio of the group, the efforts that are being made to ensure sustainability of the business, identifying and managing risk, and the development of our people.
I will then touch on the financial performance of GUD in the 2021 financial year, a performance in difficult and variable trading conditions. However, it demonstrates the resilience of our portfolio of businesses. I'll also talk about Board developments. Finally, following presentations on the operations and financial position of the company from our managing Director, I will provide commentary on the outlook for the current financial year. Firstly, safety. Safety is a key priority for the company. Throughout the year, the Directors and management continued monitoring and enhancing our safety practices and actions across the company. As a Board, we encourage management to maintain the physical and mental welfare of our employees, in which COVID-19 has been such a significant factor. We maintained a strong safety focus and continued to develop and implement initiatives intended to drive a strong level of engagement, ownership, and accountability for health and safety.
As ever, we remain vigilant on matters impacting the safety of our employees. Due to COVID-19, your Board has had little opportunity to visit operational facilities in FY 2021. This has been unfortunate because these visits combine the holding of town hall meetings with all available staff and Directors conducting site safety walks. These opportunities allow Board members to get closer to the people and operations, understand the cultural aspects, and hear from staff members on a range of matters and views held in the workplaces. We look forward to re-engaging in these visits when permitted under government restrictions. Unfortunately, safety performance slipped during the year. We knew that this year was going to be particularly tough for two reasons. COVID meant some people were distracted and, in some cases, tired, despite management's focus on ensuring safety messaging and activities were increased.
The second reason was that many of the acquired businesses were not at a level of safety awareness and discipline that we expect in the GUD businesses. Indeed, we've invested heavily in upskilling personnel in these businesses. We are pleased that employees, through the annual employee engagement survey, continue to rate GUD very highly in terms of safety emphasis and concern for employee welfare. Now turning to strategy. The GUD business portfolio is centered on the core automotive and water businesses. We continue to grow organically. Innovation plays a big role in our future plans. Additionally, as witnessed this past year, we remain willing to make logical automotive acquisitions. While the slowdown in new vehicle sales has been experienced in recent years, exacerbated by the impacts of COVID, the automotive aftermarket has shown some resilience. The Board firmly believes the company remains well-positioned in the medium to long term.
Together with management, we continued our focus on the operational fitness of our businesses and innovation efforts, as well as new product introductions from the prior year. We saw a number of opportunities to acquire businesses that were a strategic fit. We increased our exposure to the four-wheel drive SUV market with the acquisition of a number of business units from AMA Group. We also acquired Australian Clutch Services, a leading player in the replacement and performance clutch market. Our acquisition tempo has been further evidenced by announcement late yesterday that GUD Holdings has entered into an agreement to acquire Vision X Group of lighting businesses from the company's U.S. and Korean founders. Vision X was founded in 1997 and has grown to be a global manufacturer and distributor of niche lighting products and engineered solutions.
We are so excited at this prospect as the acquisition of Vision X is an important pillar in one of GUD's longer term portfolio aspirations of becoming a global niche leader in automotive lighting. Vision X manufactures and distributes a range of lighting products that is highly complementary to BWI's existing products and will extend BWI's reach to all continents, including the two largest lighting markets, the U.S. and Europe, and the acquisition has compelling financial outcomes and interesting longer term potential synergies. Graeme will speak further to Vision X in his address, and I welcome Vision X's founders, Tony and David, along with the rest of the employees, to the GUD team. The focus on strategic planning continues.
While the Board expects management to drive the operational delivery in the short term, over the last two years, there has been increasing emphasis on developing, renewing, and implementing clear individual business unit strategies for the medium to long term. We are evolving our corporate strategy, identifying the drivers of portfolio vision and ensuring this is understood at Board level and with management as a cohesive, rational prescription for the growth of our portfolio. This work allows us to be deliberate and strategic in capital allocation decisions. Broadly speaking, our strategy addresses maximizing shareholder value by focusing on group-wide initiatives such as operational matters, business unit strategies such as innovation, product development, M&A, et cetera, and portfolio vision. This is underpinned by sustainability goals, having a social license to operate in resilient markets.
Embedded in our strategy are the principles of environment, social, and governance, ESG. We acknowledge our role and impact in society, knowing we have a dual responsibility to ensure the long-term health and sustainability of our company. As such, the Board has broadened the short-term incentive structure, introducing non-financial metric targets, encouraging and rewarding executives for effort focused on ESG priorities. As our ESG strategy and targets evolve, we will continue to align our STI structure. As part of the GUD portfolio vision efforts, we recognize there is further work on our ESG strategy to be completed, and have committed to allocate human and financial resources reflecting the group's ESG aspirations. This will ensure GUD understands the impact of our footprint and takes a clear view on our part of the solution, whether it be the way we operate or the products and services we provide.
I should mention our risk management framework. Our resilience throughout COVID-19 demonstrates the importance and value of our focus on risk management and mitigation. Your Board is increasingly aware of the risk posed by cyber. As we have seen, no business is immune. We are pleased that management is taking a proactive and determined effort to secure our IT operating environments. Our highly engaged employees enable us to deliver positive outcomes to our stakeholders. We also believe that diversity and inclusion is seen as a key driver of innovation and company performance. Our focus over many years has been to ensure that our culture fosters a high-performing and engaged workforce within each of our businesses. More recently, we have turned our attention to greater emphasis on diversity and inclusion, talent development, and to realizing the full potential of the human capital of GUD.
This year, because of COVID-19, we have taken our training and development online, continuing with our leadership development program and beginning a program for future leaders. Now, to talk about financial performance. FY 2021 was unprecedented. The impact of COVID-19 has been immense. Fortunately, the industries represented in GUD's portfolio have shown enormous resilience throughout the various government-imposed lockdowns, especially when operating norms have been really tested. FY 2021 began with much uncertainty surrounding our business and the customers we serve. Management of our businesses continued with the same level of focus, employing our well-documented COVID-19 response plan framework, with a view to managing our business in a responsible, deliberate, and if required, tactical and nimble manner. Credit is due to our management and our people adapting to the vagaries we are living through.
They have shown resilience, care and compassion, and yet have delivered for all of our shareholders, employees, customers, suppliers, and shareholders. The year was particularly rewarding in a financial sense, with the group achieving a record financial performance, with underlying EBIT exceeding AUD 100 million for the first time ever. As a result, we restored the final dividend to levels seen prior to COVID-19. During the year, we had a capital raising to part-fund the acquisition of the G4 group of businesses from the AMA Group. The capital raising was a combination of a placement to institutions and a share purchase plan offered to existing shareholders. The Board is conscious of the need to balance shareholder pro rata access to these offers of additional equity with the need to ensure a successful capital raising.
We calculated that all shareholders with up to a holding of 30,000 shares in the company, which would cover most, if not all retail investors, would not be diluted if they fully participated in the AUD 30,000 cap on the SPP. Last year, the Board reintroduced the dividend reinvestment plan, which has been very well received with a participation rate above 20%. The DRP enables the company to raise incremental additional equity to bolster the balance sheet and conserve cash at a time of acquisition activity. In all, we have saved over AUD 15 million in cash flow and issued an additional 1.38 million shares. In March 2021, we were joined on the Board by Carole Campbell. Carole has over 30 years financial executive experience in a range of industries, including professional services, financial services, media, mining, and industrial services.
Carole is the Non-Executive Director on two other listed companies and serves the community in not-for-profit roles. In June 2021, we welcomed Professor John Pollaers to the Board. John has over 30 years experience in fast-moving consumable goods and healthcare sectors, as well as considerable manufacturing experience. He also has experience on government advisory committees in the education sector and not-for-profit space. We look forward to our shareholders approving the election of both Carole and John later today. After the end of the financial year, Anne Templeman-Jones retired from her role as Non-Executive Director of GUD to enable her to devote more time to her Board commitments. Anne has been a tremendous asset to the GUD Board in the six years where she has had roles as Chair of Remuneration Committee, Chair of the Risk and Compliance Committee, as well as the Audit Committee Chair.
We thank her for her contribution to GUD and wish her much success in the future. I should elaborate on our approach to Board development and recruitment. Two years ago, we undertook an externally facilitated Board performance review, which enabled the then Board to identify a number of areas where it was considered Board skills and experience could be enhanced. This led to the appointment of a well-recognized executive and Board recruitment firm, with whom I have worked with over the past two years to bring to the Board excellent candidates we have appointed, including Jennifer Douglas in March 2020, and our recent appointees, Carole Campbell and John Pollaers. The process was robust and lengthy in the case of each appointment.
Once a detailed profile had been created, including critical skills and experience required, the external executive recruitment firm was instructed to develop a list of potential candidates, both from Australia and internationally. At the same time, a Board subcommittee was formed, led by me, to review a long list of candidates, followed by a detailed interview process. A short list was then formulated, and the rest of the Board was then given the opportunity to meet with the candidates. On behalf of your Directors, I thank all staff for their effort, contribution, achievements over the years. I also thank shareholders for their ongoing support. Before addressing our outlook, I invite our Managing Director, Graeme Whickman, to provide you with some more perspectives on the financial, people, and operational performance of the business.
Just before we do that, I'd like to share this one-minute video that shows the Intelli-Start car battery charger from Projecta. Let's take a look at that video right now.
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Well, good morning, ladies and gentlemen. Thank you for the opportunity to address you today. I'm pleased to be able to provide comments on our safety, operating, and financial performance, including our continuing responses to the COVID-19 pandemic. I'll also touch on comments around our ongoing efforts to strengthen our business foundations, evolve ESG and portfolio vision work, as well as business unit strategies. Let me start with safety. You've heard from Graeme. GUD really does take safety clearly very seriously, not just this year, but also every year. Now, we're proud of our businesses, all of which remained operational through each of the lockdowns. Our commitment then and now is to maintain a safe working environment. Now, GUD's overall LTI frequency rate performance remains significantly better than the Safe Work Australia industry benchmarks.
However, we did see our performance drop as a result of two changes. Now, we've reclassified our physiotherapy-treated injuries as medically-treated injuries. The increase in LTI frequency rate was predominantly a trend of strains and sprains, which has driven a bespoke work stream to review and improve across the business units. We also need to recognize the profile of our newly acquired businesses, which, by nature of their manufacturing operations, also carry a greater injury risk potential to our employees. Now, there is a significant level of focus in the acquisition management teams on the work to deliver and achieve the GUD level of health and safety expectations. Now, positively, our employees again rated our strong commitment to safety as the highest attribute at about 94% in the FY 2021 Qualtrics employee satisfaction survey.
However, efforts in the matter of safety are never complete, and we challenge ourselves to maintain a chronic unease and have further plans for ongoing health and safety enhancements. Now, as we entered 2021, we faced ongoing COVID challenges continuing from the second half of 2020. Now, the entire GUD leadership team worked hard to remain operational. We maintained our focus in three areas, which were people health, operational health, and financial health. We doubled down on our mantra to be a good partner to our suppliers, employees, and customers. We also worked hard on the offense as much as defense, which resulted in many positive outcomes ranging from employee engagement, product launches, market share gains, customer acquisition, and our record financial results.
The health and safety and well-being of our employees continued to be a key priority as COVID impacted our people and businesses. The collaborative health, safety, and well-being subgroup formed in the early stage of COVID is comprised of a number of members from each of the business units, and this continued to be very active over 2021. The group has been instrumental in supporting communication campaigns on health and hygiene matters, tailored plans meeting the needs of our people returning to our workplaces, and a comprehensive mental health and well-being program, including the establishment of a peer support program. Operationally, the continued efforts to maintain a strong inventory position allowed us to respond to the increased demand caused in part by the restocking at our customers and in part due to the strengthening end-user demand. However, high operational costs were experienced to ensure we could meet elevated demand.
There were periods where constrained employee numbers were in place due to the mandated lockdowns and other times where we had semi-permanent overtime hours and were employing incremental casual labor to keep pace with the order backlogs and rebounding demand. The significant effort shown by the many manufacturing, warehouse, and logistics employees was commendable. Our supply base provided tremendous support in ensuring our demand forecasts were met. However, an unparalleled amount of time and energy was employed managing the logistics chains to support a constant supply of our goods getting to customers. This often resulted in a difficult balance of sea and airfreight logistics. A clear challenge was the unprecedented increases in shipping costs, which began to emerge early in the year. Now, these escalated late in the second quarter and really continued to hit hard in the third and fourth quarters.
Now, we chose to take a strong inventory position to avoid disappointing our customers, knowing that the upside in customer relationships could manifest in broader share of wallet and market share opportunities. The financial health efforts from the prior year remained. Some businesses continued to qualify for JobKeeper or its equivalent in the first quarter of FY 2021. Those subsidies amounted to about AUD 2.8 million. Now, we've not returned any of that money to the government, or the equivalent subsidies. Critically, these amounts have been more than absorbed by higher operational costs and maintaining the pay and care levels for staff who are underemployed or unable to do their job as a result of the government-mandated COVID-19 shutdowns.
To be clear, we made no employee redundant by COVID through the COVID period, and we kept all in employment and treated employees at an exceptionally high standard. Now, let's turn to our financial results for FY 2021. The financial results for GUD were very strong, and we delivered record-setting revenue, EBIT, and net profit after tax operating results. Revenue grew by 27.2% to AUD 557 million. Encouragingly, organic growth was 15.2%. Underlying EBIT increased 25.4% to just above AUD 101 million, underpinned by organic growth of 17.1%. Now, that result was slightly higher than our guidance range put forward earlier in the year, and our shareholders were rewarded with dividend growth. The final dividend payment was AUD 0.32 per share, bringing the full year total to AUD 0.57 per share.
The full year dividend represents circa 2% growth over FY 2019, sort of pre-COVID levels, which is pleasing considering the expanded capital base following the capital raise and the acquired businesses only contributing six and four months respectively to the FY 2021 result. Our balance sheet remains strong with gearing of approximately 27% and robust interest cover. Therefore, our publicly stated acquisition tempo can clearly be supported with the current low levels of debt. Reported cash flow from operating activities was AUD 74.4 million, up AUD 8.9 million from the AUD 65.5 million reported in the prior year. The cash conversion result of 86.5% was slightly above our internal expectation. As mentioned, running higher inventory levels was part of the COVID response plan, and the conversion performance is a reflection of this.
During the year, the company completed an equity raise of AUD 75.7 million in support of the G4 acquisition, which involved a net cash outflow of AUD 66.5 million. In the second half, we announced and completed the acquisition of the ACS business, which involved a net cash outflow of AUD 30.1 million. At year-end, our net debt was at AUD 146.6 million, an increase of just AUD 4.5 million over the prior year. Now, the year wasn't all about acquisitions. The leadership group continued working hard to strengthen their business foundation in five key areas: customer relationships, supplier engagement, people cycle planning, product cycle planning, and operational efficiency. That attention continued, and further improvements have been made. In terms of customer relationships and relationships, we experienced positive growth in a number of our own brands.
saw the take-up of new products, gained market share, and in a few cases, saw our customers turn to us for house brand supply and management. We added additional OEM customers both domestically and internationally, and worked tirelessly through COVID to assist our customers in creative ways. In terms of suppliers, well, we continue to work with those critical suppliers to confirm source and security as a priority. GUD's ethical sourcing program reflects a commitment to sustainable procurement across a broad range of areas, and it's now well established. The program is built on GUD's ethical sourcing code, which seeks assurances from suppliers in relation to their operations on safety, environmental sustainability, and business ethics. It also explicitly prohibits human rights abuse, requiring commitment to respect worker welfare. In cycle planning for people, well, we've been working diligently to develop future leaders for our current businesses and future acquisitions.
Quite a topical moment actually, COVID resulted with an initial temporary pause in the inaugural program. That program is a two-year, 12-module emerging leaders program, and it concentrates on the emerging leaders across GUD's two cohorts of about 18 people per cohort. It's facilitated by a selection of external leadership and business experts. Later in the year, we restarted that leadership program online to ensure we didn't pull back from investing in helping our people be the best version of themselves. Equally, GUD is committed to be a diverse and inclusive organization which treats all our people fairly and equitably.
The representation of women within the senior management group has increased 4 percentage points to 20% during 2021, underlined by the appointment of two business unit leads, Valentina Tripp at Davey and Gemma Collins, who leads our New Zealand business, Griffiths Equipment. The overall employee score, engagement score that has improved from the prior year and cemented our place again in the top quartile of the Qualtrics global study. We actually saw improvement in 15 of the 17 dimensions in our annual employment engagement, while the other two dimensions remained at the same 2020 level. We're also proud to have Ryco Filters recognized as Australia and New Zealand's 7th best place to work in the manufacturing and consumer goods section of the AFR BOSS Best Places to Work list.
Now moving to product cycle plan, where we continue to bolster our innovation and product creation focus. Product cycle planning and innovation are the critical work streams to drive organic growth. GUD increased the product development investment in 2021 over the prior year. Multiple GUD businesses derived in excess of 10% of their FY 2021 revenue from products that didn't exist 24 months ago, a testament to their product creation and commercialization capability. With innovation at its core, two GUD businesses have placed in the top 10 of the manufacturing consumer goods section of the AFR BOSS Most Innovative Companies Awards. GUD's filter business, Ryco Filters, took out second place, and Brown & Watson International, BWI, third place in the 2021 awards.
Receiving their award for their N99 MicroShield medical grade air filter, Ryco Filters's work to develop a world-first medical grade air filtration for vehicles was driven by a desire to, you know, protect the health and safety of vehicle occupants from hazardous pollution, allergens, bacteria, and viruses. BWI's third place is attributed to their creation of a full program of jump starters utilizing Projecta's well-patented Rapid Recharge Technology. The technology uses a vehicle's alternator to recharge the jump starter battery, taking only 40 seconds to fully replenish any charge lost in the jumpstart process. We're really proud of the work done by the teams at Ryco Filters and BWI. Their desire to push for better ways to serve the people who use our products and our customers is second to none.
We're also particularly excited about the launch of IM Group's battery refurbishment program for hybrid electric vehicles and the imminent pilot with Relectrify to repurpose battery packs from electric vehicles for use in industrial energy storage solutions. The latter partnership with Relectrify is supported by the Circular Economy Business Innovation Center. It has a Recycling Victoria Business Support Fund, which is delivered by Sustainability Victoria on behalf of the Victorian Government. Let's talk about operational fitness. Well, the need for operational efficiencies remained of paramount importance in a year of multiple acquisitions. The fitness work has been to look across the GUD group to achieve efficiencies for the future through leveraging greater commonality and scale. Over the last 12 months, we've completed operational fitness actions such as the establishment of an additional warehouse for IM Group, giving room for its growth aspirations, some of which I've just mentioned.
Consolidation of Ryco Filters, AAG, IM Group, and DBA into the Auckland Distribution Center facility with other GUD businesses now operating from those premises. Wesfil setting up a warehouse west of Melbourne to service the growing needs of that side of the city, and the completion of the AAG operation for a full co-location to Ryco Filters facility in Altona. Now, let me touch on strategy. Throughout the year, the Board and the management continued to refresh individual business unit strategies. Two years ago, we introduced the Roger Martin Where to Play and How to Win framework to guide strategy development. This remains critical as we reinforce the need to future-proof our individual businesses.
Now, as we move through the COVID period and also gain more comfort in the individual business unit strategies, the need to come forward with a comprehensive portfolio vision is never more timely. Management have been working through Q4 and Q1 to formulate that vision, with details which detail the size, the shape, and the quality of the GUD portfolio through to 2025. We look forward to articulating the future of GUD portfolio at our pending Investor Day. Now, talking portfolio, as Graeme Billings mentioned earlier, during the year, we separately announced the purchase of a four-wheel drive business in January and the ACS business in March 2021. ACS forms a friction division along with Disc Brakes Australia, and G4 marks the beginning of a four-wheel drive division within GUD.
These acquisitions are directly in line with the acquisition strategy detailed in the last Investor Day in October 2019, where we spoke about the interest in the four-wheel drive thematic and product categories where we currently don't play in the traditional automotive aftermarket. Now, the acquisition tempo hasn't slowed, and Graeme has already mentioned we announced an exciting new acquisition opportunity of Vision X Lighting, and I am absolutely delighted to talk about our newest acquisition. Frankly, it even trumps the record profits I've just spoken of. The acquisition of Vision X is an important pillar in one of GUD's longer term portfolio aspirations of becoming a global leader in niche automotive lighting, and it'll sit in BWI business portfolio.
Vision X manufactures and distributes a range of lighting products that is highly complementary to BWI's existing products and will extend BWI's reach to all continents, including the two largest lighting markets of U.S. and Europe. Now, we entered into the agreement to acquire Vision X business for an enterprise value of about $52 million-$53 million, representing circa about 6x the calendar year EBITA. The GUD expects the acquisition to be single digit, I mean high single digit pro forma FY 2022 EPS accretive, and that's pre-synergies. The acquisition is to be debt-funded, leaving a solid balance sheet with still a forecast pro forma FY 2021 leverage of circa 1.7x. Vision X is forecast to deliver double-digit EBITA growth in calendar year 2021. Now, we're really energized by what Vision X acquisition can bring, such as important diversification by product, customer, and geography.
Vision X products are powertrain agnostic and EV ready. Furthermore, circa 80% of Vision X customers are new to BWI and are spread across all continents. Secondly, the addition of an offshore lighting manufacturing capability, while the Korean and Chinese factories bring state-of-the-art equipment and product development capabilities, adds diversity and supplier surety. It complements existing supply partners as well as providing for BWI's geographic expansion. Thirdly, it provides a compelling financial impact with longer-term potential synergies. Now, it's an attractive impact on the short-term financials, but those longer opportunities could exist in expanding Vision X's Australian revenue by leveraging BWI's marketing distribution capabilities. In addition, Vision X provides BWI with a platform to sell BWI lighting products to Vision X customers based in the U.S. and Europe. Longer-term upside exists from manufacturing some of BWI's lighting products, with potential to also improve margins.
Now, we'll introduce Vision X more comprehensively at our Investor Day, where I'm sure investors will see why we are so energized. Okay, well, I wanna touch about ESG and GUD continued its journey on ESG matters in 2021, including the release of our first modern slavery statement. Our ESG efforts will continue in earnest over the next 12-24 months as we embrace the externally facilitated materiality assessment currently in progress. From the work to date, the materiality assessment is validating the importance of climate strategy, ethical sourcing, and workplace health and safety to our business and to our stakeholders. This assessment will be instructive as we shape and finalize our next stage of ESG strategy, which importantly and naturally will work in concert with our portfolio plans.
In summary, 2021 was an exceptionally strong year, both in terms of financial and non-financial measures. This was delivered in a context of considerable operational change due to the backdrop of COVID-19. Our shareholders should have confidence in our ability to maintain an operational tempo while still delivering the right balance of short, mid-, and long-term deliverables. Now, in mid-October, we took the opportunity to release a trading update for the first quarter of FY 2022. Throughout the first quarter of FY 2022, we have seen demand remain resilient despite the widespread and protracted lockdowns. Those lockdowns in the first quarter have been localized and regionalized rather than universal. Importantly, our existing automotive businesses have achieved modest organic growth in the first quarter, even compared to what was a very strong FY 2021 first quarter.
The acquisitions we made in FY 2021 are performing in line with expectations despite ongoing capacity constraints. Davey Water Products revenue is up strongly over FY 2021 first quarter, and the new CEO's actions and her plan are well advanced. Pleasingly, export demand is strong across Davey, DBA, and ACS. Further, FY 2022's first quarter performance reflects our planned and implemented price rises, FX constraints, and cost management. The freight and supply cost increases experienced to date are broadly consistent with our internal forecasts. GUD's group revenue and EBIT is tracking in line with our management expectations, with margins, including our automotive organic margins, trending better in the first quarter versus the second half of FY 2021.
Finally, I wanna say thank you for the hard work and dedication shown by our 1,100 or so team members, which hasn't faltered in even the most challenging of times. Actually has strengthened with flexibility, resilience, and their commitment. Thank you also to the leadership team for displaying great resilience. You've been leading your teams in a way that has been recognized so positively in the employee surveys and ongoing anecdotal employee feedback. I know we have an engaged workforce due to you striking the right balance of people and business outcomes. Thank you. Then I'll hand back to our Chairman.
Thanks very much, Graeme. Again, great news on the acquisition of Vision X. Fantastic. Now, prior to addressing the various items in the Business of the Meeting, I will provide the customary outlook for the current financial year. Graeme spoke to the trading update earlier and noted the improving mobility trends as lockdowns start to ease. Our point of view remains the COVID headwinds and tailwinds still will result in a net positive for GUD. With the rise in miles driven due to heightened domestic tourism, used car sales velocity, and older average fleet age, and aversion to ridesharing and public transport, all will culminate to be supportive of the GUD automotive businesses and ultimately our end users at the workshop level. We may experience reseller demand volatility in Q2 as the lockdowns and movement restrictions move about.
However, the group is positioning for increased end user demand in terms of inventory and general operations as lockdown restrictions ease across the country and mobility snaps back late in Q2 and onwards. In terms of our financial expectations, we have actions well underway to address inflationary pressures and margins. The smaller automotive businesses have implemented their first round price rises in Q2. No further price rises are expected by these businesses in FY 2022, given the robust increases they achieved. A second round of price increase is planned for our larger automotive businesses to largely take effect in Q3 of this financial year. In terms of Davey, we are reviewing selective second round price increases or surcharges for Q3. Graeme also mentioned earlier the update about the unprecedented level of effort to manage supply chain and logistics.
The level of inventory on ground and in transit will likely be higher than usual at certain points in the year. This is critical to ensure we don't miss any sales, particularly as the lockdown eases, although this may impact short-term cash conversion performance. We are cognizant of the complex and dynamic operating environment. Absent of any further significant mobility restrictions or unforeseen economic circumstances, our earnings view of the FY 2022 year at present assumptions would see a range of AUD 112 million-AUD 116 million dollars underlying EBITA, before considering the incremental contribution, of course, of the acquisition of Vision X. Turning now to the Business of the Meeting. There are four items of ordinary business and two items of special business to be put to the meeting. The company has received some written questions from shareholders in advance of the meeting.
I trust that the presentations today contain responses adequately addressing those questions. I thank shareholders for their questions and their interest. I also invite questions on each of the items of business. You may ask your questions from now through the Lumi app. They will be addressed at the relevant item during the Business of the Meeting or at the end of the Business of the Meeting. I ask that you indicate at the start of your question what particular item of business your question relates. Our company secretary, Malcolm Tyler, will be receiving your questions lodged through the Lumi platform and will curate them. I will ask the moderator to read out your questions as we get to each item of business. Alternatively, you can use our dedicated phone line to call us and ask your question live on the webcast.
The number to call was provided to you in the Notice of Meeting and also appears here on the screen. If you are dialing from within Australia, please use the toll-free number 1-800-271-192. If you're calling from overseas, please use the country code 61, then 2-9189-6788. Again, in the interest of all shareholders, I ask that you ask only one question at a time, keep your questions and comments to no more than two minutes to allow as many shareholders as possible to speak, and confine your questions to this particular item of business and matters relevant to the shareholders as a whole. If your question or comment relates to another item on the agenda, please wait and raise it when we come to that item of business later in the meeting. Ladies and gentlemen, in accordance with current practice, I will call for a poll on each resolution.
I will hold voting on every resolution over until the end of the meeting. The status of proxies on each item of business will be shown on the screen as we address each item in turn. To the extent that there are open proxies available to be voted by me on any item, I advise the meeting that I will vote them for each of these items on the agenda. I advise that only shareholders and proxy holders can ask questions and vote on any of the agenda items. The Board unanimously recommends that you vote in favor of all resolutions. Okay, now to Item 1. Item one is to receive and consider the financial report of the company and the reports of the Directors and Auditor for the year ended 30 June 2021. No vote is required on this item of business.
However, it provides shareholders an opportunity to ask questions relating to the financial statements and reports, as well as more general questions about the management and operations of the company. You may also ask questions in relation to the conduct of the audit, the content of the Auditor's report, the company's accounting policies, and the Auditor's independence. The company's Auditor is here online today to help answer any of your questions. If you have a question for the Auditor, please initially address it to me as Chairman of the meeting. The company did not receive any written questions addressed to the Auditor submitted by shareholders prior to the meeting. I'll now ask, do we have any questions?
Yes, we do, Graeme. We have a question from shareholder Greg Musick, who asks, "Water supply is such a huge issue in Australia and around the world. You have a pumps division. What more could you do to expand this division by joint ventures or acquisitions and seeking government grants and collaboration with universities and CSIRO? Not only could this be a profit generator, but it could also lift the image of the proud, rather lackluster company and thereby attract new talent and new investors.
Thanks for this question, Greg. Davey has a rich history of innovation with iconic products such as RainBank and the remote start Firefighter. That level of innovation has been fostered and rejuvenated by the Board in recent times. You may be aware of the launch of connected pool products such as Nipper and Lifeguard delivering pleasing results. In fact, in excess of 10% of Davey's revenue comes from products that did not exist just 24 months ago. In addition, our Chief Innovation Officer, Bart Moonen, works closely with all of our businesses, including Davey, to develop their product cycle and innovation plans. This work includes actively developing opportunities for collaboration with industry and publicly funded research organizations like universities and the CSIRO. For example, the company already has a graduate program with a leading Victorian university to bring fresh ideas and talent into the business.
David, do we have another question?
Yes, we do, Graeme. A shareholder from Faircase Proprietary Limited asks, "Why has the five-year comparison details of profit been deleted from the Annual Report?
Thank you for your question. They are included in the section headed Financial Summary and Ratios, which is found in the Annual Report towards the back of that publication. As a matter of fact, at page 32 in the FY 21 report. This has been the case for the last seven years. David, do we have any other questions?
Yes, one more question, Graeme. Shareholder CJ Searle says, "Please start making more products in Australia. They will be more expensive but advertise them widely as they'll all be better for being Aussie made. Many Australians wanna see Australian made.
Thanks for your question, Mr. Searle. Where GUD elects to manufacture all sourced products, that's determined by a number of factors. That includes price, quality, supply chain considerations, including ethical sourcing, time to market, flexibility, brand image, market dynamics, and of course, innovation and technology. Ryco Filters is a classic example of that. Many of GUD's businesses are a product sourcing model, which means they design and specify product which is made by quality assured suppliers, many of which are offshore. A number of GUD businesses are a manufacturing or assembly model, sourcing parts from a range of manufacturers, both local and offshore, which are assembled or finished in our offshore facilities. Davey is an example of that. Additionally, a number of our recent acquisitions are manufacturers. For example, ECB makes frontal protection, bull bars, and other accessories.
CSM fabricates aluminium service bodies, and Fully Equipped molds fiberglass canopies for four-wheel drive vehicles. GUD is a proud supporter of Australian Made when the long-term sustainable business case supports that approach. The factors noted above will drive such decision-making. Thanks, David. I remind you that if you have any questions you wanna put to the company, you may submit them now. To ask a question, press on the speech bubble icon in the Lumi app. This will allow a new screen to open. At the bottom of that screen, there is a section for you to type your question. Please indicate in your question the item of business relevant to your question. This will assist in responding to the question. Once you have finished typing, please hit the arrow symbol to send. Please note that you can submit questions at any time on any item of business.
I will try and address them when we come to the relevant item of business or towards the end of the meeting, when we will have more time for questions. Alternatively, you may wish to ask a question verbally. The number to call was provided to you in the notice of the meeting and also appears here on the screen. If you are dialing from within Australia, please use the toll-free number 1-800-271-192. If you are calling from overseas, please use the country code 61, then 2-9189-6788. Are there any questions?
There are no more questions, Graeme.
Okay. Given the fact that there's no more questions at this time, we'll move to the next item of business. Turning now to item 2.1, which is the election of new Directors. In accordance with Rule 34B of the company's constitution, Carole Campbell, who was appointed as a Non-Executive Director of the company on 16th of March 2021, being eligible, offers herself for election by the shareholders. No other nomination has been received, and consequently, no other person is eligible for election as a Director. Details of Carole's experience and qualifications are set out in the Notice of Meeting. Carole has pre-recorded an address to the meeting in respect of the motion for her election. Of course, Carole is available online to answer any questions, but first, let's hear her address.
My name is Carole Campbell, and I'm pleased to be standing for election today as a Non-Executive Director of GUD Holdings. I'm a professional Company Director, and in addition to my role with GUD, I currently serve on the Boards of two other ASX-listed companies, Humm Group, where I chair the audit committee, and Southern Cross Media Group, where I chair the audit and risk committee. I'm also deputy chair of the Council of the Australian Film, Television and Radio School. Prior to working as a Company Director, I had a 30-plus year executive career in senior finance roles, including as a CFO, Treasurer, and Company Secretary. This experience allows me to contribute my deep experience in accounting, finance, risk management, and governance to GUD.
I've worked in a diverse range of industries, including professional accounting, financial services, media, mining, and industrial services, and accordingly, I can contribute to Board deliberations from a range of perspectives. I joined the Board of GUD in March this year, and I'm very pleased to be working with our highly motivated and talented executive team. Through our portfolio of automotive and water businesses, the company has a clear focus on our customers, product innovation, operational fitness, and the safety and development of our teams, all with the aim of driving strong and sustainable organic growth. We are also clearly focused on portfolio composition to build an even stronger and more sustainable business in the medium to long term.
With my finance background, I understand how critical it is to have disciplined capital allocation processes to maximize shareholder value, and I look forward to contributing to the success of your company in coming years. Thank you.
Thanks, Carole. The resolution for Item 2.1 is set out on the screen. It reads that Carole Campbell, who was appointed as a Non-Executive Director of the company on 16th of March 2021, and who, in accordance with Rule 34B of the company's constitution, holds office as a Director until conclusion of this meeting, and being eligible, offers herself for election be elected. Ladies and gentlemen, the details of the proxies received in relation to this item are now displayed on the screen. I remind shareholders that you may submit questions at any time by pressing on the speech bubbles icon in the Lumi app. To assist on the Lumi app, please indicate in your question the item of business relevant to your question. Additionally, you may verbally ask questions through the telephone line. Are there any questions of myself or Carole?
There are no further questions at the moment, Graeme.
Thanks, David. If there are no further questions, we'll proceed with the resolution. Your Directors, other than Carole Campbell, unanimously recommend that shareholders vote in favor of this resolution to elect Carole as a Director of the company. I'll now put the resolution to the meeting. In accordance with current practice, I call for a poll on this motion and hold voting on the resolution over until the end of the meeting. We will proceed to the next item on the agenda. Turning now to Item 2.2, which is the election of a new Director.
In accordance with Rule 34B of the company's constitution, Professor John Pollaers, who was appointed as a Non-Executive Director of the company on 23rd of June 2021, being eligible, offers himself for election by the shareholders. No other nomination has been received, and consequently, no other person is eligible for election as a Director. Details of John's experience and qualifications are set out in the Notice of Meeting. John has pre-recorded an address to the meeting in respect of the motion for the election. Of course, John is available online to answer any questions if need be. First, let's hear John's address.
Thanks, Graeme. Well, I'm delighted to be standing today for election to the GUD Board. To give you a little bit of background, I'm currently Chancellor of Swinburne University, which I affectionately refer to as the MIT of Australian universities. I chair the Australian Financial Complaints Authority. I chair Convergence.Tech, a global blockchain digital transformation and credentialing business based out of Canada. I'm Executive Chair of my own company, Leef Independent Living Solutions, which is one of the largest assisted technology providers in Australia, supporting those aging or living with disability. In recent years, I founded and chaired the Australian Advanced Manufacturing Council, which has led to a significant focus back on our opportunities around manufacturing in Australia, and particularly the opportunities now emerging in space technology. I chaired the Industry and Skills Committee for the federal government, bringing about reforms to the VET sector.
I chaired the Australian Taskforce Review into the Aged Care Workforce Strategy, again, for the federal government, leading to fundamental recommendations that were endorsed by the Royal Commission. I'm known as being results-oriented, strategically pragmatic. I believe in building strong and lasting relationships, and I'm also known for a strong sense of social conscience. The excitement for me in joining the GUD Board is underpinned by what I see as a strong leadership team, a strong Board, and a commitment to growth, and most importantly, a commitment to shareholder value. I very much look forward to playing my part and very much look forward to the next few years as we see this company grow and develop. Thank you.
Thanks very much, John. The resolution for Item 2.2 is set out on the screen. It reads that John Pollaers, who was appointed as a Non-Executive Director of the company on 23rd of June 2021, and who, in accordance with Rule 34B of the company's constitution, holds office as a Director until the conclusion of this meeting, and being eligible, offers himself for election, be elected. Ladies and gentlemen, the details of the proxies received in relation to this item are now displayed on the screen. I remind shareholders that you may submit questions at any time by pressing on the speech bubble icon in the Lumi app. To assist on the Lumi app, please indicate in your question the item of business relevant to your question. Additionally, you may verbally ask questions through the phone line. Are there any questions of myself or John Pollaers?
There are no questions, Graeme.
Okay. Ladies and gentlemen. Thanks, David. If there are no questions, we'll proceed with the resolution. Your Directors, other than John Pollaers, unanimously recommend that shareholders vote in favor of this resolution to elect Mr. John Pollaers as a Director of the company. I will now put the resolution to the meeting. In accordance with current practice, I call for a poll on this motion and hold voting on this resolution over until the end of the meeting. We will proceed to the next item on the agenda. In accordance with Rule 34C of the company's constitution, Mr. David Robinson retires by rotation and being eligible to do so, offers himself for re-election. As no other nomination has been received and consequently, no other person is eligible for election, we will proceed with the election of Director.
Details of David's experience and qualifications are set out in the Notice of Meeting. I invite David to address the meeting in respect of the motion for his re-election.
Thank you, Graeme. It is an honor to again be considered for re-election as a Non-Executive Director of GUD Holdings. I have served you, the shareholders, for almost 10 years now, and I feel I can continue to bring you value for another three going forward. My experience is primarily on the operating and technical side. I worked for over 40 years in a multitude of functional and international roles, which culminated in multiple top management positions. Also, that work experience was primarily in the vehicular components area for both the original equipment markets and the aftermarket. The aftermarket has become a key strategic component of GUD's future. I have lived and worked in three countries and travelled to over 40 during my working career.
I am an engineer by training, so I've always been oriented to the technical side of our business, and I've been able, I feel, to bring some insight in that area to our management team. I have no other Directorships currently, so GUD has my undivided attention. In conclusion, I would ask you for your vote, and thank you in advance for your continued support.
Thank you, David. Ladies and gentlemen, we will proceed with the resolution. The resolution for Item 3 is set out on the screen. It reads that Mr. David Robinson, who retires by rotation in accordance with Rule 34C of the company's constitution and being eligible offers himself for re-election, be re-elected. Ladies and gentlemen, the details of the proxies received in relation to this item are displayed on the screen. I remind shareholders that you may submit questions at any time by pressing on the speech bubble icon in the Lumi app. To assist on the Lumi app, please indicate in your question the item of business relevant to your question. Additionally, you may verbally ask questions through the phone line. Are there any questions of myself or David Robinson?
Yes, there is, Graeme. Next, we have a question on the phone. Let's go to the operator who will introduce that shareholder to us. It's over to you, Kaylee.
You have a question from Paul Fanning with the ASA. Please go ahead.
Thank you, Graeme. I represent the Australian Shareholders' Association, as I'm the incoming monitor this year. We have 427,000 open proxy votes from approximately 107 ASA shareholders. Look, we asked a question in terms of the election process for incoming Directors. We're wondering if you can give us a bit more color or detail about the recruitment process. Retail shareholders are concerned that many Director appointments perhaps fall into jobs for the mate categories. We believe the only way to address this is by transparency through the recruitment process.
Graeme, would you like to answer that or delegate that question accordingly, please? Thank you.
Welcome, Paul. Thanks for your question. No, I'll answer that question. I did address that, I thought, in my Chairman's address. Suffice to say, Paul, that very clearly it's not a jobs for the boys here. We went through a robust process, utilizing extensively an external executive recruitment firm. It was our two new Directors were selected from a very large list, both within Australia and internationally. As I said earlier in my address, we had a subcommittee of the Board to get it to a shortlist, and then it's fair to say the full Board gave us input into the selection process. I, as Chairman, feel very comfortable that the process was independent and objective and certainly very constructive.
Thanks for your question, Paul.
There are no more questions, Graeme.
Thanks, David. If there are no more questions, we'll proceed with the resolution. Your Directors, other than of course David Robinson, unanimously recommend that shareholders vote in favour of this resolution to elect Mr. David Robinson as a Director of the company. I will now put the resolution to the meeting. In accordance with current practice, I now call for a poll on this motion. I will hold voting on this resolution over until the end of the meeting, and we'll proceed to the next item on the agenda. We'll now move to the next item, which is Item 4, which is the adoption of the company's 2021 remuneration report. Please note that the vote on this item is advisory only. However, the Board takes the outcome of the voting into consideration when reviewing the remuneration practices and policies of the company.
The remuneration report is set out on pages 29 to 40 of the 2021 Annual Report. Additional statutory information in relation to the remuneration of key management personnel is included in note 32 to the financial statements. The remuneration of the Non-Executive Directors, as recommended in the ASX Corporate Governance Principles and Recommendations, is by way of fixed remuneration and has no incentive element. On the other hand, remuneration of the company's senior executives has a fixed element and variable elements comprising a short-term incentive based on achieving predetermined financial performance criteria and a long-term incentive related to the total shareholder return on the company's shares. Both the short-term and long-term performance incentives have considerable at-risk benefits. Your Board reviews the remuneration policy and the incentive elements annually.
While we believe that our remuneration policy and outcomes are appropriate, taking into consideration the feedback we received over time when speaking with major shareholders and proxy advisors, your Board regularly reviews the remuneration policy with a view to ensuring the most appropriate outcomes for shareholders, including alignment of executive interests with those of shareholders, most importantly. The most recent review concluded that the fixed element of remuneration was market competitive and that the variable components were, if anything, slightly below benchmarks. Your Board has not changed the remuneration structure in the last three years other than to introduce additional threshold hurdles into the STI and LTI schemes, and under the LTI scheme, introduced a mechanism to permit executives to defer receipt of shares for a period of up to 15 years from the date of original grant of underlying performance share rights.
While this has potential tax deferral benefits for executives, it comes at little or no cost to the company and means that executives potentially retain greater skin in the game. We recently introduced for the 2022 financial year an additional incremental element to the STI plan. This element allows executives to potentially earn an additional 20% of fixed remuneration in the form of deferred equity for meeting certain objectively measurable non-financial criteria. While these non-financial criteria may change at the discretion of the Board, three criteria have been selected to apply for FY 2022. They are broadly safety, employee engagement, and ethical sourcing. These measures and the achievement or otherwise of them will be described in more detail in next year's remuneration report.
We will continue to look for innovative ways to attract and retain talented executives to your company, including from time to time reviewing the remuneration structure, all the while with the interests of shareholders in mind. The resolution of item four appears now on the screen. It reads that the remuneration report for the year ended 30 June 2021, as set out in the Director's report on pages 29-40 of the 2021 Annual Report be adopted. The details of the proxies received in relation to this resolution are now displayed on the screen. I remind shareholders that you may submit questions at any time by pressing on the speech bubble icon in the Lumi app. To assist on the Lumi app, please indicate your question, the item of business relevant to your question. Additionally, you may verbally ask questions through the phone line.
David, are there any questions?
Yes, Graeme, we do have another question on the phone. Over to Kaylee, please.
Hi. Your next question comes from Paul Fanning with the ASA. Please go ahead.
Good morning, Graeme. Paul Fanning again, representing Australian Shareholders' Association. Graeme, I have a question in regard to the remuneration report. We note that the Board considers the measurement of executive performance for LTI purposes by using the group shareholder TSR relative to a comparator group of companies which aligns the LTI component of their remuneration with the interests of shareholders. We believe that the S&P/ASX Small Ordinaries Index used as a comparator group is far too broad for counting in too many companies and which is not niche, of which we agree GUD has some very special parties and niche businesses. Could an ASX index such as Consumer Discretionary or industrials be more representative of GUD business interests given the expansionary mode of the company? That is my question. Thank you.
Thanks, Paul, for your question. Let me talk about the LTI. It is, y ou're quite right when you say it is based on TSR, which is not without its challenges, without its issues. It has served us well, we think, over recent years. The share price has been volatile and that's caused some challenges around whether or not the TSR is actually mentioned. But there are a number of other things that are out of our control. I must say that the Board and the Remuneration Committee is intending to review our LTI program during FY 2022, with the view to if there are going to be any changes to the basis of LTI that would be implemented in the FY 2023 year.
There are no more questions, Graeme.
Thanks, David. As there's no other questions, we'll proceed with the resolution on Item 4. I advise that any votes by Directors and other key management personnel or any of their closely related parties will be disregarded except in relation to votes available to be cast as a proxy for another person who is entitled to vote. As your Directors are not eligible to vote on this item of business, they make no recommendation on it. I will now put the resolution to the meeting. In accordance with current practice, I call for a poll on this motion and hold voting on this resolution over until the end of the meeting. We will proceed to the next item on the agenda. We'll now move to the special Business of the Meeting.
Item five on the agenda is an ordinary resolution regarding the approval of an LTI equity grant to the Managing Director, Graeme Whickman, under the terms of the company's long-term incentive equity plan. A detailed explanation of this resolution was set out in the explanatory notes accompanying the Notice of Meeting. Under this structure, Graeme has a maximum long-term incentive set at 60% of his FY 2022 fixed remuneration, which subject to meeting the performance hurdle, will be delivered in three years' time. The maximum incentive grant for FY 2022 is 51,653 performance share rights, calculated as 60% of his FY 2022 fixed remuneration, divided by the volume-weighted average price of GUD shares in the month of June 2021, which was AUD 12.1657.
Such an incentive for the Managing Director and other senior executives for that matter is common in publicly listed companies, necessary to attract and retain the executive talent considered by the Board as crucial to the delivery of sustainable long-term shareholder wealth. Typically, these incentives are designed to align the interests of executives, in this case, the Managing Director, with the interests of the shareholders. That is, the benefit of this incentive will only vest for Graeme if the total shareholder return of GUD, that is the share price increase of GUD, plus dividends paid over the next three years, equals or exceeds the median total shareholder return of the comparator group. At equal to the median, one-half of the shares vest.
When the GUD total shareholder return significantly outperforms, Graeme Whickman receives an increasing amount of these shares up to the maximum amount of 51,653 shares at the 75th percentile. That is, the company has outperformed over three years 75% of the other stocks in the comparator group. It is clear that Graeme only benefits when he delivers significant value to the shareholders. That's the way it should be. Consequently, your Directors, other than the Managing Director, unanimously recommend that shareholders vote in favor of this resolution. The resolution for item five is set out on the screen, and it reads that approval is given for the grant of 51,653 rights to the company's Managing Director, Mr.
Graeme Whickman, under the company's Long Term Incentive Equity Plan, and on the terms summarized in the explanatory notes to this notice of annual general meeting. Ladies and gentlemen, the details of the proxies received in relation to this resolution are now displayed on the screen. I remind shareholders that you may submit questions at any time by pressing the speech bubble icon on the Lumi app or verbally on the phone line. David, are there any questions?
Yes, Graeme, we have another question on the phone. It's over to you, Kaylee.
Your next question comes from Paul Fanning with the ASA. Please go ahead.
Thank you, Graeme, for the opportunity once again to ask another question in regards to the approval of LTI grant to the managing Director. We, the ASA, prefer to see a lower vesting. Your current 50%, which is for nought to 30% seem to be probably more common. The ASA position is that LTI awards based on the relative TSR hurdle should not commence unless performance is above the 50th percentile of the peer group over a minimum four-year period. Our preference is for 30% vesting at the 51st percentile, rising with a sliding scale of 2% vesting for each additional percentile, such as only CEOs who exceed the 85th percentile will become 100% of the potential award available.
Can your vesting policy be amended or reviewed at some point in time to give a slightly more cogent appeal to the managing Director? We, the ASA, will be supporting this resolution. Thank you.
Thanks for your question, Paul. I'll answer it at the start, then I'll ask our Chair of the Remuneration Committee, David Robinson to add to my comments. Couple of observations, Paul. Firstly, we are reviewing our, as I said earlier, our LTI program during FY 2022, and if we do come up with changes, they will be implemented for the start of FY 2023. Just off the top of my head, going below 50% is unlikely, as is the four-year period. It has served us well, as I said in the past. Let me just ask David to add any further comments. David?
Thanks, Graeme. I really don't have any further comments. As you stated, our program has been in place for quite some time, and we've been very happy with the results for multiple MDs or managing Directors. As Graeme stated, we are under review in this coming year, this coming financial year, the LTI program for all executives, including the MD, executive as well. We will consider what the market is telling us as well in going forward with prospective changes. Back to you, Graeme.
Thanks, David Robinson. David, are there any further questions?
No, there are no further questions, Graeme.
Thank you. We'll now put the resolution to the meeting. In accordance with current practice, I call for a poll on this motion and hold voting on this resolution over until the end of the meeting. We'll now move to item six on the agenda, which is a special resolution regarding the approval by shareholders of the giving of financial assistance by Australian Clutch Services Proprietary Limited, a wholly owned subsidiary of the company, in support of the company's obligations under its banking facilities. Now, on the first of March 2021, the company acquired all of the shares in Australian Clutch Services Proprietary Limited. That company is to become guarantor under the company's banking facilities.
The banks are concerned that in doing so, the company may be in breach of the financial assistance provisions of the Corporations Act and hence requested that the company submit this resolution to shareholders to approve that financial assistance. The explanatory notes to the meeting have gone into some detail on this resolution, but I invite shareholders to ask any questions. Your Directors unanimously recommend that shareholders vote in favor of this resolution. The resolution for Item 6 is set out on the screen. It reads that for the purposes of Section 260B, subsection 2 of the Corporations Act 2001, approval is given for the financial assistance to be provided by Australian Clutch Services Proprietary Limited from time to time in connection with the acquisition as described in the explanatory notes to this notice of annual general meeting.
Ladies and gentlemen, the details of the proxies received in relation to the resolution are now displayed on the screen. I remind shareholders that you may submit questions at any time by pressing on the speech bubble icon in the Lumi app or verbally on the telephone line. Are there any questions, David?
There are no more questions, Graeme.
Thanks, David. As there are no other questions, I'll now put the resolution to the meeting. In accordance with current practice, I call for a poll on this motion and hold voting on this resolution over until the end of the meeting. Ladies and gentlemen, that concludes the resolutions to be put to the meeting. I will now proceed with the poll on all resolutions. I will give the meeting ample warning of the close of the polls. Now, in the meantime, we have further time now to devote to hearing and responding to any other questions that you may have. Are there any further questions, David?
There are no more questions, Graeme.
Okay. Thanks, David. Ladies and gentlemen, as there's no other questions, that concludes our discussion on the items of business. Shortly, I will close the voting system. Please ensure that you have cast your vote on all resolutions. I will now pause for a minute to allow you to finalize those votes. Whilst we give those shareholders time, here's a short video from our team at Davey, after which I will be back to close the meeting. Thank you. I will just check to see if there's any further questions. David?
Yes, Graeme, there is a question on the phone for you. It's once again, over to Kaylee.
Hi, Paul Fanning with the ASA. Please go ahead. Thank you.
Thank you. Graeme, Paul Fanning again.
Hello, Paul.
Representing Shareholders Association. Graeme, I have a question in regard to the placement and SPP for the purchase of ACAD from the AMA Group, earlier this year, which was successful. I might draw to you and to other shareholders' attention, the ASA's preference for capital raising is to use Pro rata renounceable entitlement offers as this method treats all shareholders equally, compensating non-participants and avoids any dilution for investors who choose to participate. Also, it appears that more could be done to promote the SPP offer to retail shareholders. We understand that there's only a participation rate of 14% in the SPP. What could you and the Board do to promote increased participation of retail shareholders in SPPs? Could it be in the future that you might consider pro rata renounceable entitlement offers as a further up your pecking order of relevancy when you're doing further cap raisings? That is my question. Thank you.
Thanks for your question, Paul. Look, we did a placement, we did an SPP for that acquisition. We felt it was very fair, given the caps on the SPP in particular. Did we, w as the communication appropriate? I think it was. Perhaps, you know, in these sorts of processes, I think you can always improve. We were quite satisfied that we got to the shareholders that we needed to, and that it was fair and reasonable for all in terms of dilution, non-dilution, et cetera. Graeme, I'm not sure whether you'd wanna add to that.
Well, we obviously put a hurdle there of AUD 30,000, which we felt that would cover by far the majority, up to, I think, 99% or 97%, I can't remember the exact number, of all of our retail shareholders. It was down to a handful. Clearly, in that situation, we're also trying to make sure that we were able to get the funding to complete what was a very quick process. We asked our lead manager to ensure that they worked very hard to ensure that they were able to support our shareholders with an SPP. We broadcast very broadly across many channels to ensure and held it open for quite some period of time. No entitlements were turned back. There was an oversubscription, which we supported as well.
In many cases, I think, hopefully our retail shareholders saw that we were acting in their best interests and weren't denied.
Thanks, Graeme. I hope that answers your question, Paul. Okay. Voting is now closed. The results of the poll will be announced via the ASX later today. Ladies and gentlemen, I thank you for your attendance, and I now declare the meeting closed. We certainly look forward to meeting with you next year under better circumstances. A copy of this webcast will be available for viewing on the company's website later today. Enjoy the rest of your day and thank you very much.