We're ready to start. If I could just ask everyone to turn their mobiles off to start with. Thank you. So good morning, everyone. My name's Fiona Mead. I'm the Company Secretary here at CSL. It's a pleasure to welcome you to our twenty twenty-four annual general meeting. I'm going to run through the procedural aspects of the meeting, and I note that it's being held in a hybrid format. Thank you to all of you in the room today. We're in a new venue, so I hope you enjoy that. And I also welcome everybody who's joining remotely as well. For those that are here, if we do have an emergency, which I think will be unlikely, we ask that you follow the instructions from the RACV staff and listen to all announcements that come over the PA system.
If we do have to evacuate, please calmly use the stairs, which are located next to the lifts. There are assembly points on either corner of Bourke Street or William Street or on Queen Street, and if first aid's needed, please see the venue supervisor or RACV staff members for assistance. Shareholders and proxy holders present in the room can ask questions during the meeting by lining up at one of the microphones located in the aisles when we get to questions, which the chair will invite. We ask that you advise the Computershare representative of your name and show them either your red or green voting card to indicate you are either a shareholder or a proxyholder.
If you are a shareholder or proxyholder and you're participating remotely, you can also submit a written question online by clicking the messaging tab at the top of the Lumi Platform. You type your question in the box towards the top of the page and then press the arrow symbol to send. A copy of your submitted questions, along with any written responses from our meeting team, can be viewed by selecting My Messages. Online written questions can be submitted at any time. To ask your question verbally, click on the Request to Speak button at the bottom of the broadcast window. You'll be prompted to confirm your name and enter the topic of your question. Submit your request, and follow the instructions to allow access to your microphone and join the queue.
Please note that while you can submit questions from now on, they won't be addressed until the relevant time in the meeting, and if you have any difficulties, please call our AGM helpline number, which is up on the screen now. Now, I just will say, questions may be moderated for inappropriate language, and if we receive a few questions that are similar, we may answer those together. If questions are too lengthy, we may need to summarize them in the interest of time, and also, to ensure that everyone here and online has the opportunity to ask questions, we ask that shareholders restrict themselves to no more than two questions or comments initially. The chair will take questions from shareholders in the room. We will then take questions from the online platform in writing, and then lastly, we'll take verbal questions from the online platform.
Persons entitled to vote today are all shareholders, representatives, and attorneys, proxies and proxyholders who hold red admission cards. On the reverse of your red admission card is your voting paper. Please vote by marking a box beside each resolution to indicate how you wish to vote. Proxyholders have attached to their admission card a summary of proxy votes, which details the voting instructions, if any, for business items. You must vote in accordance with those instructions. In respect of any open votes a proxyholder may be entitled to cast, you need to mark a box next to the motion to indicate how you wish to cast your open votes. Please ensure you print your name where indicated and sign the voting paper.
When you've finished filling in the voting paper, please lodge it in a ballot box before leaving the meeting to ensure your vote's counted, and the Computershare representatives will come around with the ballot boxes. Voting on all items of business will close ten minutes after the meeting ends, during which time you have an opportunity to finalize your voting paper and lodge it in the ballot box. Please put your hand up if you need any help at all, and a Computershare staff member will come and help you. For our online shareholders, once we declare voting is open on all items of business, and if you are eligible to vote at this meeting, a new Voting tab will appear. Selecting this tab will bring up a list of resolutions and present you with voting options. To cast your vote, simply select one of the options.
Your vote will be automatically recorded. There's no need to press Submit or Enter button. You do, however, have the ability to change your vote up until the time we declare voting is closed. And lastly, I will just say that there are forward-looking statements throughout today's presentation. On the screen behind me here is the relevant disclaimer, which is also available on the ASX website as part of the documents we've lodged this morning. That covers the logistics of the meeting, and I'll now hand over to our chair, Dr. Brian McNamee.
Thank you, Fiona, and again, good morning, ladies and gentlemen. Thank you for joining us today, those both here present and those online. I do like this new venue, and I've noticed, I think, the food beforehand was well-received, so I'm quite pleased with this venue. There is a quorum present, and I'm delighted to open the meeting. I would now like to introduce your board of directors. To my right, our Company Secretary, Ms. Fiona Mead. You've already heard from Fiona. Next is Ms. Elaine Sorg. Elaine is standing for election at this meeting, and you'll have an opportunity to hear from her later in the proceedings. Professor Andrew Cuthbertson is next and is standing for re-election at this meeting, and Ms. Carolyn Hewson. And to my left, Dr. Paul McKenzie, our Chief Executive Officer and Managing Director. Ms.
Alison Watkins, also standing for re-election at this meeting. Ms. Samantha Lewis is standing for election at this meeting, and we'll have an opportunity to hear from her later. Dr. Megan Clarke and Professor Duncan Maskell, and finally, Ms. Marie McDonald. I have trouble seeing Marie there. Thank you. Voting on all items of business will be conducted by poll, and I'm now declaring the poll open. As Fiona said, the poll will close ten minutes after I declare the business of the meeting to be closed. Before we move to the formal business of the meeting, I will first provide some observations about your company and the environment in which we operate. I'll then hand over to CSL's CEO and Managing Director, Dr. Paul McKenzie, who will provide a review of the business and performance for the financial year twenty twenty-four.
We'll then move on to the procedural matters of today's meeting. And finally, as mentioned, we will take questions from those both in the room and online. So today, I want to provide a short commentary on your company. Firstly, though, a reminder about who we are. CSL is an established global leader in plasma-derived therapies, influenza vaccines, and iron therapies. We operate globally in large and growing markets, and we deliver innovative, life-saving medicines to patients in more than a hundred countries. Since 1994, our culture has been integral to our success. It is founded on putting the patient first in all that we do and having the best people who are empowered to make smart decisions. This culture keeps us intensely focused, and as you can see on the slide, highly competitive.
This formula delivered $2.64 billion of net profit after tax in the financial year 2024, and we declared a final dividend of $2.64 a share, which is equivalent to around AUD 4 per share. I'd like to extend my thanks to Paul and his leadership team, many of whom are in the room today, for their hard work, as well as all our people around the world. Thank you. Capital and capability are two topics that I'd now like to discuss. Over the past decade, we've invested in building of scale of CSL's global business and in our people and in our R&D pipeline. The intent has always been to invest for our patients, for public health, and for our shareholders. We work diligently to evaluate the risk and opportunity associated with all options available to us.
Over the past decade, we have completed our base fractionation facility down the freeway in Broadmeadows, upgraded our CSL Behring manufacturing sites in Switzerland and Germany, and CSL Seqirus Influenza Facility in Holly Springs, United States. We've upgraded our R&D facilities in Marburg, Germany, and Waltham in the United States. We've progressed construction of CSL's Seqirus cell culture-based influenza vaccine facility in Tullamarine and opened our brand-new global headquarters in Parkville Precinct here in Melbourne, containing R&D labs and clinical scale manufacturing. Whilst we're now entering a period of less capital-intensive growth, we will continue to grow as demand for our products increases, and we may need to further add capacity to our network before the end of the decade. The other side of the equation is capability.
Specifically, we need the right people with the right capability to guide the execution of our strategy and lead our operations, and certainly those who are committed to that culture I outlined earlier. This begins at the board level. A constant priority for us is to ensure we have the right skills and competencies that, in aggregate, can help us successfully navigate what is an increasingly complex global operating environment. These include traditional must-haves, such as risk management, scientific, and significant commercial aptitude, as well as emerging skills, such as digital and cybersecurity experience. This year, we welcomed two new board members. In January, Ms. Samantha Lewis joined. Where is Samantha? There you are. Joined as a non-executive director. Samantha is a diligent and experienced board member with deep financial, audit, and risk management knowledge. In September, we welcomed Ms. Elaine Sorg as a non-executive director.
Elaine is based in the United States and is a well-respected global leader in the biopharmaceutical industry, with a track record of successfully building franchises and brands across therapeutic areas and segments. I'm sure you'll enjoy hearing from both Elaine and Sam later in the meeting. I'm also pleased to announce that Dr. Brian Daniels will be joining our board of directors from the first of December this year. Brian is also based in the United States, is a highly credentialed director with over 30 years of experience in the pharmaceutical industry across clinical development, medical affairs, and commercializations of medicines. Finally, Professor Duncan Maskell, who was appointed to the board in 2021, is relocating to the United Kingdom, where his family resides. For this reason, he'll be not standing for re-election and will retire from the board at the end of this meeting.
Professor Maskell has been a highly respected and valued member of the board. I'd like to thank him for his valuable contribution to CSL during his time as a director and wish him well for the future. While we're on the subject of capability, I want to discuss our approach to remuneration, as it is aligned to who we are and what we do as a unique ASX-listed company. Although our heritage is proudly Australian, the global biotechnology sector and many of our executives are based in the United States. We compete for talent in that context. It is essential to our performance and long-term growth. Our remuneration structure needs to attract and retain talented people across the globe, including those who can navigate the complex science and manufacturing that underpins CSL.
Your board strongly believes our overall remuneration framework is aligned with this goal and fit for purpose of attracting top-tier global leaders who will steer the next growth for our shareholders. But we hear your discontent this year with some aspects of our approach, and of course, I'm disappointed in that. I want you to know that we're listening, and we will carefully consider the feedback we receive. Coming back to the people and talent, Paul has had his leadership team in Melbourne this past week to discuss strategy with us. He will speak about this more shortly, but we're confident he has the right team and the right strategy in place to deliver on our shared growth aspirations. Finally, as we get closer to our labs, manufacturing sites, and functional offices, capability is equally important. This year, the board traveled to Europe and the United States.
As we visit our sites, we're impressed by the individuals and teams that run CSL on a day-to-day basis. Growth and opportunity are what I want to talk about next. Our investment has laid the foundation with the right skills and talent, our people will maximize the value from them. This will put us in an excellent position to continue to deliver our medicines to our patients while maintaining sustainable, profitable growth into the future. This will come from the therapeutic areas in which we focus on. There remains significant unmet needs across these patients who are not being helped, and communities that need protection against infectious disease. Patients like Logan and Peter, you'll hear from later. We're dedicated to better serving these people. Sometimes it works out. Hearing the testimonials from patients dosed with Hemgenix, our gene therapy for those suffering from hemophilia B, attest to that.
However, there is inherent risk with any investment we make, and at times, things don't work out the way we hoped. At our R&D briefing last week, we informed the market that we're making the difficult but necessary decisions to stop some programs. This is unfortunate, but it is the nature of the research we do. CSL continues to invest and innovate in our core immunoglobulin, plasma, and vaccine platforms to support future growth and we're focused on the rapid advancement of our research and early development programs towards late-stage development and registration. Finally, I want to speak to the opportunity within CSL Vifor. It's been two years since we closed the acquisition of Vifor Pharma. We saw then, as we do now, a company that has the capabilities and competencies and clinical adjacencies to CSL that would contribute to our long-term growth agenda.
This view has not changed, but shareholders will be aware that the business has experienced several near-term challenges. We were prepared for some, but others were not expected. This is disappointing, but we remain confident that the leadership group have the right plans in place to deliver growth from CSL Vifor over the long term. I will hand over to Paul shortly, and he will detail the outlook for the business units. But before I do, I'd like to summarize my view to our shareholders. Our desire to remain leaders in the markets where we operate remains unchanged. We've implemented a strategy where, over the past decade, we've invested in our operations for growth. The capabilities of people are critical to getting the best out of these.
With these elements in place, along with the culture we have built at CSL, we can take advantage of the immense opportunities across CSL Behring, Seqirus, and Vifor, as well as our R&D pipeline. We're confident in delivering on this vision and delivering ongoing value for our shareholders. Thanks again for your support. I'll now hand over to Paul. Thank you.
Thanks, Brian.
Thank you.
Thank you, Brian, and good morning, everyone. I traveled to Melbourne several times during the year, and it truly has become my home away from home. This is my favorite time of year to come to Melbourne 'cause the weather's starting to turn, and it makes my morning swims at MSAC a little more enjoyable than in August. Most of you know I enjoy swimming, and as I do my morning laps, it always gives me a great chance to reflect on our journey here at CSL. I think about all of our colleagues, all thirty thousand of them across the world. I think about our patients and whether we can do more to serve them around the globe. I think hard about the opportunities that Brian just described, and whether we are executing ruthlessly on our strategy.
In October last year, we held our first-ever Capital Markets Day, a chance to take a look and a deep dive into the various parts of our business. As a team, the CSL Global Leadership Group made several commitments to our investors. These were the priorities and plans that would underpin double-digit earnings growth over the medium term. I am pleased to report that we've made excellent progress across all fronts in fiscal year 2024. Some of the highlights of that progress: We've been rolling out our new plasmapheresis devices, known as Rika. It's ahead of plan, with deployment in 134 centers as of the end of September. Our partner Terumo's individualized nomogram also received clearance from the FDA and has been released to CSL Plasma for introduction into our centers.
Our CSL Plasma mobile app that our donors use continues to grow in popularity, and we just passed our four millionth download. I'm pleased to say that our yield initiatives, affectionately known as Horizon One and Horizon Two, are progressing to plan. These are a key lever for efficiency for our CSL Behring business. And on that topic, we've delivered on what we said we would do, with a 120 basis point increase in CSL Behring's gross margin at constant currency as compared to fiscal year 2023. This is a tremendous effort from the team. However, we all know there's much more to be done. We continue to expand our geographic footprint with the EU launches of Hemgenix and Tavneos, as well as the launch of Ferinject in both China and Canada.
Developing innovative products is at the very core of why we exist, so we are committed to advancing our R&D pipeline, which I will speak about shortly. As you can see, we've made significant progress on all the strategic priorities outlined at our Capital Markets Day. This is a testament to all the hard work of all of our people around the world, but everyone is truly aware that there's more hard work to be done. We hope this progress to date demonstrates our ability to execute to plan, and we believe, with these foundations established, CSL is in a strong position to continue to deliver annualized double-digit earnings growth over the medium term.... As Brian mentioned, a key to achieving these goals is the quality of our leadership team.
I have made several appointments over the last eighteen months, and am thrilled with the caliber of talent we have leading CSL, many of whom are here with us in the room today. This includes people who have deep CSL knowledge and experience, as well as talent we've attracted from other global pharmaceutical companies. I'd like to thank them for their collaboration and leadership throughout the year. Now, let's turn to the headline figures and operational highlights of fiscal year 2024. As Brian mentioned, CSL has delivered an excellent result for fiscal year 2024. It was really driven by the strong performance of CSL Behring business. First, the headline numbers. Revenue was AUD 14.8 billion, up 11% at constant currency. NPAT A was AUD 3 billion, up 15%. Net profit after tax was AUD 2.6 billion, up 25%.
For CSL Behring, where revenue was up 14% at constant currency, our IG franchise continued to show its strength. Sales were up 20%, with strong growth recorded across all geographies. Underlying demand for IG continues to be robust across our core indications of PID, SID, and CIDP. In CSL Plasma, the underlying fundamentals of plasma collection remain strong, with continued momentum in donation growth. We remain focused on our gross margin recovery, and as I highlighted earlier, we are making good progress. We continue to expand the geographic footprint of our plasma center network, having opened three centers in Puerto Rico this past year. CSL Seqirus delivered solid sales growth, outperforming the market in a challenging season. Growth was primarily driven by our differentiated portfolio and led by our adjuvanted Fluad product.
I am very proud to let you know that this drug is now a blockbuster, with vaccine sales over $1 billion last year. In partnership with Meiji, regulatory approval was received for the world's first-ever self-amplifying mRNA vaccine, Kostaive, for the prevention of COVID-19 in adults. The first dose was recently administered, and we expect sales from the Japan launch in this fiscal year. The phase III clinical trial for aTIVc completed enrollment earlier this calendar year, and the phase I study for self-amplifying mRNA in influenza is enrolling patients now. CSL Vifor continues to grow volumes in Europe, despite the impact of generic competition on Ferinject. We remain confident in our plan to drive long-term value from the business. Moving on to the financial highlights, total revenue was up 11%- $14.8 billion.
The group operating result was up 13% to $6.5 billion. Research and development costs were at 12%, largely in line with our sales growth. General and administration costs were down 6% due to the efficiencies that we have generated from our enabling functions and some FX impacts relative to the prior year. Net finance costs increased 7% due to the full 12-month impact of the Vifor debt and higher interest rates on our floating debt. NPAT A, attributable to shareholders of CSL, was up 15%. Return on invested capital was lower at 10.5%, as we foreshadowed, and this was due to the full year impact of the Vifor acquisition.
To reiterate our statements from the capital markets day, this is a low point, and ROIC is expected to improve over the medium term, driven by our annual double-digit earnings growth. NPAT A EPS was 11%, and NPAT EPS was up 20%. The total dividend was up 12% to $2.64 per share. And as Brian mentioned, this translates to approximately AUD 4, which is up 10% on the previous year. Developing innovative products is at the very core of why we exist, so we are committed to advancing our R&D pipeline. A few highlights from fiscal year 2024. In CSL Behring, garadacimab provides a great example of our innovative approach as we aim to build on our ongoing strength in HAE.... We are working towards approval in multiple markets before the end of this fiscal year.
We continue to reinforce our leadership position in IG as we execute studies to expand indications that will benefit more patients around the world. For CSL Seqirus, product innovation remains a core focus, with phase III clinical work progressing well for our aTIVc product in seasonal influenza. At CSL Vifor, Filspari was approved in Europe, which is exciting for us to have a new treatment option for adults with kidney disease. On the sustainability front, we continue to make good progress. Since first announcing our sustainability strategy in 2021, we have evolved our approach and are focused on our sustainability vision for a healthier world. This year, we repositioned our sustainability strategy, taking a focus area approach across the pillars of healthier communities and healthier environment.
Additionally, we have identified strategic themes of health equity and empowerment, of inclusion and belonging, where actions through our focus areas can drive real outcomes across these pillars. As you have seen in our annual report, we have made clear our ambition across each focus area, including some new goals. For example, we've announced new targets for waste and water. We continue to execute against our emissions reduction targets and reinforce our commitment to patient communities and plasma donors via our focus area ambitions. I'd now like to finish with a few comments on our outlook. Looking by business unit and starting at CSL Behring. We continue to expect strong demand for IG across all of its core indications. With various positive global reimbursement decisions now in place, we look forward to increasing Hemgenix patient uptake in fiscal year 2025.
We are preparing for regulatory approval for garadacimab, which, if achieved, will make this the next CSL product, homegrown here in Australia, to come to market. We will progress to full deployment of the ReCa technology and the individualized nomogram. Horizon One and Two yield initiatives will continue to advance to plan. All these factors will drive the expansion of CSL Behring's gross margin contribution to the business. For CSL Seqirus, we expect continued market outperformance, driven by our differentiated portfolio, albeit in tough operating conditions across the world. Commercialization of Kostaive in Japan, while continuing to progress registration for Kostaive in both Europe and U.S. We remain prepared to deliver vaccines and adjuvants to be used against any potential outbreak of avian flu.
For CSL Vifor, we are operating within an evolving iron market, and while there are pricing challenges for the near-term revenue growth, volume growth remains strong, and we continue to be the largest and most significant player in Europe iron market, and will continue to expand our geographic footprint with iron around the world. We will maintain growth momentum across our nephrology pipeline, capitalizing on the recent launches of TAVNEOS and Kapruvia, and the just-commenced launch of Filspari. We remain focused on identifying and unlocking value by leveraging capabilities across the entire CSL group. In collaboration with CSL Behring, CSL Vifor will continue to advance the significant public health need in patient blood management. For CSL at the group level, I am pleased to reaffirm our financial guidance for fiscal year twenty-five.
Revenue growth is expected to be approximately 5-7% at constant currency, with NPATA expected to be in the range of approximately $3.2-$3.3 billion at constant currency, growth of between 10-13%. Importantly, I reaffirm our annual double-digit earnings growth outlook over the medium term. I will now hand back to the chair.
Hopefully, I don't need to use that. Fine. Thank you, Paul.
Thank you, Brian.
Thank you, Paul. So we'll now move to the formal part of the meeting. The items of business for consideration today are described in the notice of meeting, which I will take as read. In terms of running the AGM efficiently, we will read through all the items of business set out in our notice of meeting, following which we will address all shareholder questions at one time.... I confirm that I'm holding available undirected proxies in my capacity as chair of the meeting, and will vote all available proxies in favor of each resolution. The board recommends that shareholders vote in favor of each resolution, with interested directors abstaining from making a recommendation in respect to the resolution that they have an interest in. In order to conduct the poll, I appoint Michael Hutchinson of Computershare Investor Services to act as a returning officer, Ms.
Ginevra Cavallo and Ms. Thea Cook of Deloitte to act as scrutineers. Voting is now open on all resolutions. We come to item one in the notice of meeting, which is to receive and consider the financial statements and the reports of the directors and auditors for the year ended thirtieth of June 2024. The item of business does not require shareholder approval. However, shareholders have an opportunity to ask questions on the reports and about management of the company. Ms. Ginevra Cavallo and Ms. Thea Cook of Deloitte are also present today and available to answer questions in relation to the conduct of the audit, the preparation and content of the auditor's report, the accounting policies adopted by the company in relation to the preparation of the financial statements, and the auditor's independence in relation to the conduct of the audit.
As there is no resolution required to be put to the meeting in respect of item one, I move to the second item of business, which is the re-election and election of directors. The qualifications and expertise of each of the candidates seeking election or re-election are outlined in the notice of meeting. Having reviewed the candidates' performance, the board supports their re-election or election. Today, you'll hear from Ms. Sorg and Ms. Lewis, our new directors seeking election to the board. I will now stand aside as chair, and Ms. Carolyn Hewson will take the role of chair of the meeting for the re-election of the directors for the items of business at two A, two B, and two C. I will then step back to introduce new directors and the items for two D and two E.
Thank you, Brian. Hello, everyone. Items 2A, 2B, and 2C relate to the re-election of Dr. Brian McNamee, Professor Andrew Cuthbertson, and Alison Watkins, who are all existing directors. Brian is the chair of the board, Andrew is the chair of the Innovation and Development Committee, and Alison is the chair of the Audit and Risk Management Committee. You can read their resumes and details in the 2024 notice of meeting, and also on CSL's website. Brian, Andrew, and Alison submit themselves for re-election pursuant to Clause 67A of CSL's constitution, and will retire at this meeting under the company's constitution, and are eligible and willing to stand for re-election.
The board has determined that they are all independent directors. The board, with Dr. McNamee, Professor Cuthbertson, and Ms. Watkins abstaining, recommends that shareholders vote in favor of the re-election of these directors. I refer to the slide that has the details of the proxy position for these resolutions. As we are holding all our questions until the end, I will invite Brian to resume his role of chair of the AGM and move to the items relating to the election of the new directors. Thank you.
Thank you, Caroline. We now move on to item two D, which relates to the election of Ms. Samantha Lewis, who is an existing director of the board and is submitting herself for election pursuant to Clause 65 C of CSL's constitution. Samantha retires at this meeting, and under the company's constitution, is eligible and willing to stand for re-election. Ms. Lewis' resume and details are contained in the twenty twenty-four notice of meeting and on CSL website. I'll now invite Samantha to briefly introduce herself to you. Thank you.
Thank you, Brian, and good morning to you all. And Brian, I did get the brief message. As we all know, CSL is a company that improves the lives of people with serious medical conditions and protects public health. It also has a successful history of delivering strong financial returns. It's therefore an enormous privilege and honor to be standing here with you all today for election to the CSL board. I've been a non-executive director for over a decade, serving large ASX-listed companies in the capacity of director and audit committee chair. Prior to this, I was a partner at Deloitte in its Assurance and Advisory division, where I acted as auditor and advisor to a number of major Australian-listed entities.
I bring deep financial and accounting expertise to the board and to the Audit and Risk Management Committee, as well as strong experience in capital management and capital allocation, internal audit, risk management and compliance, M&A, and ESG. My experience spans a variety of industries, including manufacturing, retail, infrastructure, and industrial. I feel that my skills and experience are complementary to those of the existing and incoming board members, and that I can make a significant contribution to the governance priorities of CSL. In the short period I've been on the board, I've appreciated the depth and talent of the management team, the collegiality and wisdom of its board members, and the deep focus on innovation, excellence, and continual improvement. And above all, the passion and commitment of all of the team members to the core purpose of the organization.
I understand the responsibility of being a board member of CSL, one of Australia's most successful organizations, but operating in a highly dynamic and challenging industry. I'm committed to serving your interests diligently and with integrity, and I look forward to positively contributing to CSL's journey ahead with your support as shareholders. Thank you.
Thank you, Samantha. The board, with Ms. Lewis abstaining, recommends the shareholders vote in favor of the election of Ms. Lewis. I refer to the screen behind me that has details of the proxy position for this resolution. Congratulations. I will now move to item two E, which relates to the election of Ms. Elaine Sorg, who is an existing director of the board and submitting herself for election pursuant to Clause 65 C of CSL's constitution. Elaine retires at the meeting under the company's constitution and is willing and eligible to stand for re-election... For election, sorry. Ms. Sorg's resume and details are contained in the twenty twenty-four notice of meeting and on the CSL's website. I will now invite Elaine to briefly also re-introduce herself to you. Thank you.
Thank you, Chair, and good morning, shareholders. Today, I stand for election as a non-executive director of CSL. I have spent my entire career involved with companies that bring people and science together to improve the lives of patients. This purpose was the reason I chose to pursue a degree in pharmacy and to dedicate my life's work to improving the health of others, and it remained my motivation throughout my 35 year long career at biopharmaceutical companies like Eli Lilly, Abbott, and AbbVie. I want to continue to contribute to this purpose with CSL, a company that I have long admired. Viewing the company from the United States, it truly has been the quiet overachiever. CSL has a proud Australian heritage and a track record of delivering for patients and shareholders alike. I share your board's optimism for the future as the company looks to build on its tremendous legacy.
Governance and stewardship are essential to this ambition. The skills I have developed in similar global organizations will complement those of your existing board members. Specifically, I have been involved in commercial operations, strategy, cross-functional R&D and drug development, and proudly bringing several groundbreaking medicines to patients in need. In my final role before retirement at the beginning of this year, and as an executive of AbbVie, I served as president of their U.S. organization and was accountable for 13,000 employees and contractors in delivering annual sales in excess of $40 billion. I also served on the board of the Biotechnology Industry Organization, the largest advocacy organization in the world representing the biotechnology industry.
More recently, I have acted as a senior advisor to the Boston Consulting Group's healthcare practice, where I help multinational organizations navigate the complexities of the healthcare sector. I believe that these skills and global perspectives will be valuable in helping steer CSL through its next phase of growth. I am acutely aware of the responsibility involved in serving such a well-respected, value-led organization, and it would be my privilege to be elected to your board. Thank you for your consideration.
Thank you, Elaine. The board, with Ms. Sorg abstaining, recommends the shareholders vote in favor of this, of electing Ms. Sorg to the board. I refer to the screen behind me that has details of the proxy position for this resolution. Congratulations. We now come to item three of the notice of meeting, which is advisory vote on the remuneration report.... To deliver on our promise to patients and to protect public health, we rely on our people and need to ensure a strong global talent supply. Our executive remuneration framework enables us to attract, engage, retain talent, provide us with the flexibility to address talent challenges in various markets, and it allows us to compete with larger global pharmaceutical companies.
The board is committed to an executive remuneration framework that is focused on deriving a performance culture and linking pay to the achievement of CSL's long-term strategy and business objectives. These, in turn, drive shareholder value. Under the Corporations Act, the company is required to include in the directors' report a detailed remuneration report setting out certain prescribed information relating to the director and executive remuneration. The company is also required to submit this for adoption by resolution of shareholders at the annual general meeting. The vote on this resolution on this item is advisory and will not bind the directors of CSL. However, we will take the outcome of the vote into consideration when reviewing remuneration practices and policies of the company. The screen behind me displays details of the proxy position for this resolution.
We are disappointed we did not receive more support for our remuneration report today, and hear the concerns that have been raised by some shareholders. We'll revisit our remuneration process in the coming year and continue to engage with our shareholders to address these issues. The board unanimously recommends that shareholders vote in favor of the adoption of the remuneration report. We'll now come to item four, which seeks approval for the purpose of ASX Listing Rule 1014 and other purposes, for the grant of 38,065 performance share units under the company's executive performance and alignment plan to Dr. Paul McKenzie, CSL's Chief Executive Officer and Managing Director. The board believe it is in the interests to provide Dr. McKenzie with an equity-based incentive to ensure there's alignment between satisfactory returns for shareholders and Dr. McKenzie's reward.
It also considers important to obtain shareholder consent to the grant of performance share units to Paul. The board, with Dr. McKenzie abstaining, recommends that shareholders vote in favor of the grant of performance units to Dr. McKenzie. I refer to the screen behind me that has details of the proxy position for these resolutions. We now move to item five, which is a special resolution. The Corporations Act permits a company to include a provision in its constitution prohibiting the registration of or a transfer of securities resulting from a proportional takeover bid, unless the relevant holders of the securities in the meeting approve the bid. Under the Corporations Act, these provisions must be renewed every three years, or they cease to have effect. The directors consider that it's in the best interest of shareholders to renew these provisions in their existing form.
A special resolution is being put to shareholders under Section 648G of the Corporations Act to do this. More details on the reasons for renewing the proportional takeover provisions are set out in the notice of meeting. I refer to the slide that has details of the proxy positions for this resolution. We now move to Item 6 of the notice of meeting, which relates to the Australian law, which restricts the benefits that can be given without shareholder approval to individuals who hold management or executive office, or have held such an office in the past three years, in connection with the cessation of employment or retirement from their office with a CSL subsidiary entity.
Shareholder approval is sought in relation to the to potential leaving entitlements for CSL subsidiary directors and CSL subsidiary entities, to which Sections 200B and 200E of the Corporations Act apply. The full details of this resolution are contained in the 2024 notice of meeting. To be clear, a CSL subsidiary director excludes CSL Limited directors or its executive leaders. The board considers that it is appropriate that shareholder approval for termination benefits for CSL subsidiary directors, as described in the 2024 notice of meeting, is supported. I refer to the slide that has been detailed, the proxy positions of this resolution, and now we move to the final resolution of today's meeting. Shareholder approval is being sought to approve an increase in the maximum aggregate amount which may be paid to non-executive directors' fees in any financial year.
The NED fee cap by AUD 500,000 from AUD 4 million to AUD 4.5 million. Under Rule 68B of the CSL's Constitution and ASX Listing Rule 10.17, the NED fee cap may only be increased with shareholder approval. The current NED fee cap was approved at the AGM in 2016. Since that time, as CSL's continued its international expansion of its business, and continues to be particularly important that CSL remains able to attract and retain directors with the appropriate experience, expertise, skill, diversity to oversee CSL's business and strategic direction. Further details of this resolution are contained in the notice, 2024 notice of meeting. Again, the board considers it appropriate to put this proposed increased NED fee cap to our shareholders.
The amendment will be treated as applying in respect of each financial year of the company, commencing on or after the first of July, 2024. If shareholder approval is not obtained, then the NED fee will remain at the current amount of AUD 4 million. The remuneration of non-executive directors for the year ending 30th June, 2024, is detailed in the remuneration report. No securities have been issued to any non-executive director under ASX Listing Rules 10.11 or 10.14, with shareholder approval within the last three years. I refer to the slide that has the details of the proxy position for this resolution. Thankfully, that completes the items of business, which we now require, and so we can now move to shareholder questions. So please remember to cast your votes on each resolution.
To allow shareholders extra time to submit their questions, we'll now move to address questions from shareholders here at the venue. And next, we will address written questions, noting those questions may be moderated for appropriate language or content. And finally, we'll hear from shareholders' verbal questions from online. Are there any questions from the floor?
Mr. Chairman, Mr. Michael Muntisov, representing the Australian Shareholders' Association, wishes to pose a question.
Good morning. My name is Mike Muntisov. I'm from the Australian Shareholders' Association. Today, I hold proxies from 688 shareholders, representing an aggregate of 1.1 million shares, which is equivalent to the 15th largest shareholder in the company. Mr. Chair, I have two questions, one on item one and one on item three. How would you like to deal with that?
I think two questions, and I'll try and answer them or get others to answer them. Thank you.
Okay. You mentioned, CSL Vifor had near-term challenges. You said, some of these were expected, but some were unexpected. Could you share with us what the challenges are and how CSL is responding?
Is there a second question?
Answer that one first.
Oh, sure. Okay. Thank you, Mike. Well, and again, thank you. We've always appreciated our relationship with the ASA, so thank you for coming here representing them. I mean, Vifor. I mean, we can describe the things that we like and the things that we've been disappointed in. I think if we start at the latter, we would. We've been disappointed with two matters that I think we didn't get right. And they related to the impact in the U.S. market of a thing called step edit, which is a way in which the insurers try to prioritize less expensive iron replacement medicines before they could go on to the more expensive but more effective Vifor products. So there was a lack of detailed understanding of the impact that occurred as we were making, doing the transaction, was the first thing.
And the second one really related to the generic pathways, which we understood as the main Ferinject product was going to lose exclusivity in Europe and the US market. We did not correctly anticipate the mechanism by which the regulators would approve it, the generic competitions. We thought it would be a more cumbersome, complex generic pathway for those drugs. So those are an example of two things we didn't get right, and clearly, that has had an impact on the speed and some of the economics of the business. So what do we like about Vifor still? And 'cause we do like things about... I mean, I like the fact it generates, it's a really positive cash-generative business.
So if you look at the history of CSL Behring and CSL Seqirus, it tends to be a really good business, but they're capital-intensive business as well. We build big plants. We have to continue to reinvest. Vifor is a slightly different model, where they have, they're more capital light, it's more cash generative. And I think if you look at the de-gearing of the CSL balance sheet, starting after the acquisition, as we're seeing happening now and will happen over the next few years, CSL Vifor has contributed significantly to the cash-generating, free cash-generating capacity for us to reduce our debt. So I like the cash-generative nature of the business. What else do we like about it? I mean... We do believe the iron market is an underserved market.
We accept that we're dealing with loss of exclusivity, but we, the team, I believe, has a strong plan to sustain significant volume growth in that business in many markets around the world. And in fact, we're now launching Ferinject in Canada. We have recent registration in China. So we're trying to balance the competitive pressures that we're seeing in the iron market with growth internationally. So we do like iron, and we do see good future in iron, but we're accepting we have had pressures. And then we move to nephrology and the whole area of renal disease, and I think that it has an excellent joint venture in North America with Fresenius. It has excellent pipeline of new products, some of which we described today that we're launching.
So we see optionality in the business model, but we all understand it hasn't delivered the growth that we were looking for when we made the transaction, we talked about a transaction in the first five years. It's not. But we do believe that with investment in our own R&D, complemented by their work and some of the partnering arrangements we have with them, I believe Vifor can be a very fine asset for the company. As I said, we already like its cash generative capacity. We just have to now invest in its growth phase.
Thank you. I have a comment or question and comment on item three, remuneration. We understand that CSL may be aiming to increase the CEO's long-term incentive opportunity to better match global standards over time. Based on the figures in the remuneration report, that implies a possible increase from the current long-term incentive of around AUD 12 million to AUD 19 million, which is a very significant increase. Perhaps you could confirm that that is your thinking, and if so, we would like to suggest that the stretch performance targets to achieve that award should be significantly increased so that the target and stretch target levels are much more challenging than current levels.
Look, I think we'll answer that. Thank you for the questions 'cause it's sort of that question that always hangs out there the whole time, you know? I'll answer it at a high level, and I'd love Megan to comment specifically. Look, at a high level, the challenge for us is we've evolved from essentially when I joined CSL, Commonwealth Serum Labs, heaven forbid, we were 100% local company. If you look at us now, we generate 10% of our revenue from Australia, and in fact, far less of our profitability, partly because we invest here. So, and then where do we do our business? We operate so strongly in North America and Europe that we. And that's, you see it with some of the new directors we're recruiting.
We need to complement what we do, and we need to ensure that we have the best people we can find to do the job. These people, they live in America. We're not employing Australians to move to America to run the company. So it's a complicated thing, and the reality is, on the ASX, putting News Corp to one side, I'm not sure what News Corp is, but it's certainly a very massive global company. We're really the only truly global Australian company in some ways. We truly operate globally. We're not, you know, my friend Megan here, we don't dig it out of the ground and ship it to China. That's not our business model. I'm not even sure that's global. I mean, they do it.
They do a good job, and thank goodness the miners do their good job. Don't get me wrong, but that's not us. We have to operate in the market. We have to recruit great people. We've got to retain them. We've got to motivate them. So I hear what you're saying, but it's, I also get a lot of feedback, "Well, why can't we just get Australians to do the job?" Well, the reality is, these are eminently well-qualified, experienced people, and we have to match the market. That's a reality. Megan.
Thank you very much, Brian, and thank you very much, Brian, and lovely to see you, Mike, and we, as I said, we do appreciate the engagement that we have with ASA each year. I think taking the first point that you wanted to raise, which is in relation to how do we position our remuneration of our CEO. So we look at a set of global peers in the biotechnology sector. As the Chairman has outlined, we compete for our talent and particularly for our key KMP in the U.S., and therefore, we need to make sure that our remuneration package can attract and retain that.
As we look at the CEO's remuneration, if you look at the long-term incentive, and as you know, our remuneration is certainly geared to the long-term performance, shares in the long-term incentive, our CEO sits at 69% of the median, so, so below the median in that, in that sector. So you can see that for a performing company of ours, and for the caliber of CEO, the caliber of our executive, we look at. We don't aim to go above the median, but we do look to be fair, to make sure that our executives are paid appropriately. And we also look at where we sit relative, in that peer group in terms of market capitalization.
In terms of any increase, that's actually a discussion that we will have over several years, which I highlighted in the remuneration report. It's not something that we would do overnight. It must be linked to performance, but we would certainly, as a principle, look to pay our executives fairly and equitably in relation to the pharmaceutical market. So I think that's your first question, and as I said, we will engage slowly and year by year with the shareholders on that particular issue. In relation to the targets, we set the targets consistent with our long-term plan. And as both the Chairman and the CEO have been clear, if you look at our long-term targets, they require the company to deliver double-digit earnings growth over the medium term, year on year.
That is an, that's extremely challenging target for the executives, and we also make sure that when we look at those targets, we talk them through, of course, with the shareholders as well, but it's very challenging for the executive, and as we set the boundaries around that, this year we've actually set the lower boundary. We've tightened that up as well, just to really focus on the growth elements. Our long-term incentive, coupled with our short-term incentive, short-term focusing on the delivery and execution of the plan, but the long-term incentive is really looking at, as our chairman outlined, how do we actually deliver that growth that you as shareholders expected? So we focus those targets very clearly on growth metrics of return on invested capital and earnings per share growth. Thanks, Mark.
Next question from the floor. Thank you.
I have a question-
Oh, sorry.
for Alan King over here.
Thank you.
Thank you very much, McName e. I'm asking a question totally differently to what the others are. I note in your annual really that you are doing blood management technology. Is this the only area that you're focused on and probably have a relative advantage in worldwide? But I was wondering, in the newer area of better take note of all of this, muco- in the mucosal system, there seems to be such a huge area of, in the future, to do work that would be. It's a new frontier, I suppose. Had there been any scoping study about any of this area, or are you really very focused on your own area? Thank you very much.
Thank you. Look, thank you for the question. We're always looking for other areas in which we can compete and create a sustainable business model around. You know, the human body has a number of mucosa as well. I mean, there's a lot of work in the gut that we're certainly aware of, and we're also looking at our respiratory medicines. We're looking at delivering our immunoglobulin inhaled for certain chronic bacterial diseases, particularly in the lungs. So certainly, the mucosa is a reasonable target. And look, I think that we, our R&D folk, you know, diligently look for areas in which we can compete effectively. So we try to be broad, but also make sure we can be competitive. Thank you.
Mr. Chairman, a question from Mr. Chris Maxworthy, a shareholder.
Good morning, Chair. Good morning, Board. Well, Mr. Chair, first thing, thirty years ago, the IPO for CSL, June, do we celebrate?
You just reminded me. Yeah, that's funny, eh? Did we?
Sixth of June it was.
Sixth of June. Look, it's it was... What a-
Great night
... yeah, great memory. Great memory. It's flown. Yeah. So, look, thank you for reminding me. We are doing a celebration. I know next year I'm going back to Bern to celebrate our twenty-fifth anniversary of buying ZLB, the Swiss company. So-
Yes
... that's a big thing. It is interesting, you know, I mean, we love being a public company compared to what Commonwealth Serum Laboratories was like under the dead hand of government ownership. Let's be clear.
The dead hand.
The dead... That's the kindest thing I can say. So in any event, I mean, it's sort of interesting. We love growth. We wanna keep growing. I mean, so it's nice to look back and, yeah, I can, you know, I just was sitting there hearing, you know, we paid AUD 4 Aussie dividend last year, and we listed at AUD 0.76. People think it was AUD 3. They forget about the split. We listed at AUD 2.40, and but essentially it's pre-split, it was at AUD 0.76. So it's been a great journey. So thank you for reminding me.
Right. Okay. I'm one of those fortunate people that bought in forty, sorry, thirty years ago. So,
Well done
... the dividend pays for what I originally invested every year, so I'm grateful for that.
Thank you, Chris.
Okay. On previous occasions, I've commented that CSL under-promises and over-delivers. This year, not so much. ... Okay, so the thing that I'd like to clarify is, we all walked past some protesters downstairs-
Yeah
-that I presume are affected by hemophilia and perhaps contaminated blood products some years ago. I'd just be curious about what CSL is doing in relation to those people, because I recall that the United Kingdom, the government has settled in that regard, and I would look at CSL as being so large that if we were to hold out or to say, "Not our problem, it's a government problem," that could have adverse impact on our profile and our commitment to people and a healthier community. So I'd be interested in your comments.
Look, thank you for that. I mean, with regard to the matter downstairs, I mean, of course, in the '70s and '80s, it was a terrible time for the whole blood sector, whether it be the whole blood, you know, transfusion sector and whether it be the plasma fractionation industry, because none of us went into this industry contemplating that that would be the case. I mean, certainly I wasn't there, but it's still a, you know, a terrible thing to remind ourselves that every day we have to do things better. We have to, you know, ensure we put in place incredible checks and balances, whether it be the steps we take to check the blood and check the donors and manufacturing process and inactivation.
So we are very, very, very confident, of course, today of the quality of our products. If I go back to the 1970s and 1980s, remembering I was not there at Commonwealth Serum Labs, and this was a complicated relationship between the Australian Red Cross and then the Department of Health, Federal Department of Health, that was both our owner and our regulator and our funder. So we had a variety of things, and clearly, the pain and suffering is terrible, and, you know, I express my deep sympathies to that. That's so none of us want to be in that business. The challenge is, it is a long time ago, and as...
whether it be the transactions we've done subsequently in the plasma sector, let's say the Aventis Behring transaction, or whether it be the process by which we sold to the public, the IPO of CSL, indemnities were always given by the owners. That was just the way it was done. At this stage, it was Australian government, but it was also Aventis. They gave us indemnity with regard to historical, you know, viral transmissions. That's normal practice. So look, we, you know, we completely understand it. We have you know deep sympathy for them.
It's occasionally a little complicated to understand what they're asking of us, but they have our deepest sympathy, and our job is to just make sure this never happens again, and that we're putting processes in place to try and make our products as safe as possible. To be frank, and whether it's a plasma product or a new recombinant protein or whatever, that's our job. Thank you.
If I may. Okay, what I would like to suggest to the board and the senior leadership is that it's in the interest of CSL, particularly given our size in the Australian market, to not become a target, and I understand what you're saying, that perhaps leadership on our part, in order to pull together the various governments, the Australian Blood Authority, in order for us to find a way forward and in order for us to make this, as a risk to our reputation, go away, so I hear your words of sympathy, but I think that action of some form where we take the lead and are seen, not necessarily as the owners of the problem, but the people investing in an outcome, I think that would be helpful.
Look, I hear what you're saying. Thank you. Let's hope the other parties-
I think, I'd say, I think it's up to us. We have the marketing and political influence and the ability to connect at senior levels in order to have an outcome that politically works for those that are in power and works for us in terms of reputation. All right?
Thank you. Well, yep, good. Noted.
Thank you. And I think some people might agree here, too.
Well, look, I mean, I think it's fine. Let's see-
Actions. Actions, I think, will help. Okay. Thank you.
Thank you. Next.
Mr. Chairman, the next question is from Mr. Anton Nigro, a shareholder.
Hi, my name is Anton Nigro. I've been a shareholder since 2016. My question is in relation to CSL112. In February, CSL announced that the study didn't meet its endpoints. Since then, there hasn't been much said. Does the company believe anything positive come, will come from this study or is it at an end?
Look, I might hand it to the CEO to comment specifically on the 112, but in essence, significant investment went into the clinical trial. It didn't meet its primary endpoint. There is some interesting data, but we haven't yet seen anything in the data that would encourage us to put it back into development. Paul?
Thanks, Anton. Thanks for the question. As Brian said, we didn't meet our primary outcome, which was disappointing, right? We were going after a long-standing scientific hypothesis to see if we could really change the path of cardiac disease. But when we look at those results and we look at where the world has moved with other medicines that have come in, SGLT2s, GLP-1s, when we look at the data and the potential size of the investment that would be made against the potential commercial, we can't see a viable scientific or commercial pursuit that makes sense for the company at this point.
Thank you.
Thank you.
Mr. Chairman, the next question is from Mr. Vincenzo Nigro, a shareholder.
Oh.
Thank you. A bit nerve-wracking come up here. My name is Vincenzo Nigro, and myself and my family have been proud CSL shareholders for at least 10 years. Thank you for giving me the opportunity speaking. What are management's thoughts on the possible change of government in the U.S., especially under a Trump administration, making it harder for people to come into the U.S.? Could that affect plasma availability? Also, if the Trump administration introduces high tariffs on goods brought in from Europe, could that also affect CSL's revenue? And I've got one more, if I can, one other question.
Oh, yeah. You're on a roll, Vincenzo.
But I can't let it go without asking about Vifor, of course. Can management see the day or, say, the next two to five years, where they can see Vifor growing at high single digits, low double digits, going forward? Is that possible?
Look, thank you, and I'll start with Vifor, then go back to the simple matter of the U.S. politics. So look, I mean, Vifor, I think I set it out, that I think it's stable. I think the business is stable. And we need to create some new opportunities through R&D, business partnering, et cetera, and these things take a few years. So, as I said, I think it will continue to help us deliver and provide us with opportunities to invest because it throws off a lot of cash. It's very cash generative. Growth, we would like to see it, but we're being realistic. We're being realistic, given the challenges they have. The team have done, I think, a great job stabilizing the business.
With regard to U.S. politics, thank goodness I'm not a commentator, and it's probably a little too broad. I mean, you ask a relevant, narrow point, tariffs and donors. We don't believe there's really any questioning the ability of donors to move. Look, I think healthcare products have generally been well treated from a tariff perspective, but there's so far to go, and I can't imagine that's a high priority of any either of the administrations. So we're mindful, and we're aware, but we're selling life-saving medicines. So we're not Bunnings. We're not shipping stuff in, you know, that just gets made and sold to everybody. That's not our model.
Thank you, Brian. Appreciate it.
Cool.
Mr. Chairman, it's Mr. Peter Calamari, who would wish to ask a question. He's a shareholder of the company.
Thank you.
Hello, Peter Calamari. Like Chris, I'm a thirty-year shareholder, another one that got in the float and still own my shares. So thank you for all the work you've done in the last thirty years. I've been very fortunate. My question is to do with the Seqirus business. This year, when I had my flu shot, I got a quad flu shot. I've read somewhere that next year it's only gonna be a triple flu shot, and there won't be the availability of the quad. Is this true, and if so, why?
Well, well, it's sort of a good news story in one sense, that the vaccines have done part of their job, as well as the natural evolution of various strains. I think it's B/Yamagata, isn't it?
Yes, correct.
The B/Yamagata essentially isn't around anymore, so there's no point in vaccinating against that B strain that no longer exists. It's not being detected anywhere in the world. Now, is it possible another strain might come up, and then we'll go back from trivalent to quadrivalent again another time? Yes, absolutely. But these decisions are not made lightly by World Health Organization and the various other influencer expert groups. So yes, you'll get a trivalent until we're told it might need to be quadrivalent again.
Thank you.
If we have no other questions in the audience here... Oh, we have a waving hand at the back. Apologies for those, and you might have a written question there.
Mr. Shareholder, this is Patricia Kerr.
Excuse me, Mr. Chairman. This is Patricia Kerr, a shareholder, who'd like to ask a question.
Hello. I'm not sure how long I've been a member of CSL. I think I've got to look it up now, but it's been quite some time. And I love CSL, it's my favorite share. And thanks for all the work you've done. I heard something you were doing. I might have missed it, but you were doing some sort of research on kidneys. I'd like. Could you explain all that to me, please?
Well, yeah, thank you, Patricia, for the question. I was pointing out that Vifor is part of the therapeutic areas in which we operate. They have a very strong iron therapy franchise, and then nephrology or renal disease is their other, particularly in the dialysis, in and out of dialysis market, is the other area. So it's predominantly late-stage kidney disease that we've been operating in. We also may or may not do some other work in transplantation in that area. So that's where we're focusing in renal disease. Look, well, thank you for the audience questions. We apparently have a number of written questions, so this may take some time. Let's see.
Okay. We had a number of pre-submitted questions, and thank you to shareholders that took the time to do that. The first one is about holding an AGM outside of Melbourne. This shareholder says: "We held our AGM in Sydney a few years ago, which was very well attended, and wondering if we might do that again?
Look, thank you for the question. It's true, we did hold an AGM in Sydney some time ago. We try to balance operational efficiency, so we have many of our executives flying in from overseas here. We do a lot of work with them. So there is an efficiency to us in Melbourne here that is very helpful. We've had a lot of support from our Melbourne shareholders, which has also been real. We also hold annual shareholder briefings in different locations around Australia.
This year, we met our shareholders in Perth and Adelaide. And so I... Look, I think it's an interesting issue. It's not something we spend a lot of time on. To be frank, getting venues is one of the challenges, having to book it in advance, sufficiently advance, to try and get organized. So I hear you. I think it's something we could consider in the future. But as I said, there is a excellent operational efficiency for us doing it here in Melbourne that. And this is our home, and this is where our head office is, that makes it helpful. But thank you for the question.
The next question comes from Mr. Andrew Fitzsimmons. "How is our company collaborating with suppliers and customers to become more sustainable? For example, eliminating single-use plastic.
Look, thank you for the question, Andrew, and I will turn it over to our CEO, who is very committed and very expert in this field.
Great. Thank you for the question. I appreciate it, Andrew. If you look at our emissions, Scope 3 is the biggest part of our emissions, which takes, as you highlighted, partnering with partners around the globe in all parts of the supply chain. Not only the raw materials and the packaging components, but all the way through. So we have in our, as part of our sustainability effort, for all of the top suppliers, we work with them on their own individual emissions target programs, and that's part of our qualification of the suppliers, to make sure that they have a program to eliminate emissions where possible in the entire process. In addition, we look actively for substitutes in any part of the process we can do that will further enhance our commitment from a, from a healthier environment and community.
Thanks, Paul. Next question.
Our next question comes from one of our holders in a super fund, Fairlane Super. Another sustainability question, Mr. Chair. Sorry. "Can CSL source more of its power from renewable sources?
Paul?
Yes, we've been working very hard to look at renewable sources around the world. I'm pleased to say in 2024, we did sign a renewable linked power purchase agreement here in Australia with the Australian provider, AGL, and this agreement will commence in January of 2025, so that's part of our own commitment to reduce our Scope 1 and 2 emissions. So all of our Australian manufacturing facilities, which we have quite considerable investment here in Australia, in Broadmeadows, and soon in Tullamarine, these certificates and new power agreements will help us continue to reduce our Scope 1 and 2.
Likewise, we looked at other parts of the world where we have in the U.S. and Europe, and we're considering those renewable contracts. It's just a matter of balancing the timing of those against, you know, where the ecosystems of those individual plants are with the service that they can achieve.
Thanks.
All right, we have one more pre-submitted question. This is a question around our directors' fees. How much are our directors paid directly, and what are the committee fees?
My memory is that, Look, thank you for the question, Angie. That this is all in the annual report. But having said that, just to repeat it again, the directors are paid a base fee and in addition, receive a fee for any committee work they're members of. That's with the exception of the chair. Fees are inclusive of superannuation contributions. Non-exec directors must sacrifice at least 20% of their pre-tax base fee in return for grant of rights each year, entitling a NED to acquire one share at no additional cost. Details can be found in the remuneration report, pages 96 and 97. Thank you.
Okay, we have a question from Mr. Mark Randall: "Just curious, as a new shareholder, why has your share price dropped from AUD 308 to AUD 295?
You know, it's never wise to comment on share price. It's just a terrible thing to be asked to comment on. But look, Mark, thank you for the question. You know, I can be glib and say that, you know, we obviously had more sellers than buyers at that price, but that's probably a bit superficial. There's so many factors go into share price. For us, currency is a big one. If the Australian dollar starts appreciating against U.S. dollars, we report U.S. earnings, so we are very sensitive. I mean, currency's had a big impact on the company over the last, you know, three to five years.
So that's certainly one factor, and I think it's fair to say the more recently, when we updated the market from an R&D perspective, when we had some programs that we didn't go forward with, that may or may not have, you know, disappointed a couple of investors who bought on the back of that. So there's always factors, but I'd have to say that band is a bit narrow to really be, you know, overly worried about. I mean, we think performance. If we can perform every year, double-digit growth, generate cash, pay down our debt, invest sensibly, that will get reflected in the share price. But I, you know, there is no commenting on the share price exactly is too hard.
Okay, a question from Miss Anne Nankerville: "I've had CSL shares for over twenty years, so would appreciate more franking credits. Fully franked would be wonderful. Even partial franking consistently would be appreciated. Please let me know of your long-term plans for franking credits.
Look, and thank you for the question. The reality is, most of our business is offshore, and here in Australia, we have a significant expense base for R&D and corporate activities, which means that our Australian earnings are modest, and therefore, we pay tax consistent with our Australian earnings, not our global earnings. So I think we're really never likely to be a franking credit stock.
All right, we now have the questions that have come in online today. The first question is from Mr. Williamson: "Some more recently published analysis of the AEGIS-II trial data have demonstrated efficacy for 112 , including a multiple event analysis and for the patient subset who were baseline hypolipidemic." I hope I pronounced that right. "Does this not support submission of CSL 112 for registration? Why has there been no mention of CSL 112 by the company, and what are the plans?
I'll give this one to you, Paul, if you like. All right?
Sure. Thank you for the question. As I had said earlier, we looked at all of the results, both primary and secondary outcomes, and you're highlighting a potential secondary outcome, to Brian's point, that looked interesting. And when we looked at it, we tried to say: Well, how could we further prosecute that? And when you look at further prosecution of it, the number of patients involved and the healthcare outcome that would be there, just the investment versus the benefit, just when you weigh it out, wouldn't be there.
So at this point, we don't see pursuing CSL112 any further. That said, if new science presents itself, and if there's other actions, but the world and the cardiac space has changed quite a bit, and we don't see a motivating factor at this point. We do talk with our regulators about the data, both primary and secondary, and they concurred with our views on where we're at with the product.
Okay, next question. We've had two questions on the SA mRNA vaccines that have combined together. "If CSL determines that SA mRNA vaccine is not safe for continued use for few, with few adverse effects, will CSL stop introducing it? Has the SA mRNA vaccine produced adverse effects?
Look, we believe that the data from Kostaive, our COVID vaccine, is very good, particularly from an immunogenicity and durability perspective, compared to other vaccines. The data's good, and the side effect profile is comparable. So, the Japanese regulatory agencies do a very rigorous review, and it's clear by approving the drug, they believe that the risk-reward is heavily weighted to this being a very good vaccine for their market. So I don't quite understand the question, but clearly, all vaccine companies need to look at the risk-reward of vaccines, and the side effect profile, and we continue to invest in all our vaccine platforms, whether it be adjuvants, protein-based vaccines, and self-amplifying mRNA.
Okay. Our next question comes from Mr. Cody: Was it a mistake to buy Vifor Pharma for over eighteen billion? And if so, how can the board be sure such mistakes won't be made in the future? Is CSL ex-growth now? Our shares are worth less than they were five years ago.
Look, again, I'm trying not to comment on share price. Look, I think if we look back at the Vifor transaction, that value is Australian dollars, isn't it?
Yeah, we paid $12 billion.
Yeah, we paid $12 billion. I tried to answer it before. I think that we think Vifor has many features we like in the business that we operate. There were things that were not discovered in diligence, not provided to the company. Whatever the explanation means that the growth hasn't been what we'd hoped it to be in the first, in these years and probably for the next few years. But the reality is, we think it's a very good area for us to invest. It's highly complementary, and I think we've just got to make it perform. So is it... Has it had effect on the share price? It's possible, but there are many things that affect share prices, so I don't, I couldn't comment specifically on that.
Our job now is to make it work and do a great job with it, and I think, you know, we're really happy with the team we have, we're happy with the integration work we've done, and we believe we can make this a really successful growth engine for the company in the medium to long term, not in the short, short term.
Okay, we have another question from Mr. Cody: In the last 10 years, CSL's return on capital has dropped in half, and return on equity has fallen from 40% to 15%. It appears that CSL is struggling to maintain its past superior performance and is now chasing unprofitable or low-returning growth opportunities. What went wrong, and how can the board right the ship before it is too late and shareholder value is permanently destroyed?
Look, I think that, It is true that, the Vifor transaction on our balance sheet is, has had a, a significant effect on our overall ROIC levels, which is still a decent level by most companies' perspective, but not where it used to be for us and not where we want it to be in the future. So this is a very long-term industry, and it's one that takes courage to invest, because we know pipeline activities take seven to 12 years. Bringing on new plants takes seven to 10 years. Developing markets can take three years. So we invest for the long term, and that's our intention. We believe that the ROIC will improve as our performance and returns improve, and that's what Paul talked about before.
And we've had currency headwinds, which has been our other reality, as we talk in U.S. dollars. So I think we're well-placed. I just think we ask shareholders to be patient on Vifor, but it's a big piece of our invested capital now, and it will take time to digest it, and help it perform and help our overall returns.
Okay. Our next question comes from Mr. Stephen Mayne: Australia... There's lots of words here. Australia is currently in the midst of an unprecedented deluge of takeovers that has contributed to listed entities on the ASX falling by 170, or 7.4%, since June 2022, including 20 straight months of declines. There have already been 27 major takeovers above AUD 200 million completed so far this calendar year, as the ASX loses many long-standing names such as CSR, Boral, Blackmores, Newcrest, and Crown.
Does the Chair agree there is a clear mispricing between public markets and private markets, as evidenced by the drought of floats to replenish the ASX ranks? In this current Darwinian environment, why should we still be legislatively and constitutionally protected from takeover, unlike 99% of other ASX-listed companies? Does the Chair agree the share price would be higher if these parochial and nationalistic provisions were removed? What would be wrong with a big pharma rival buying us, just like we can buy them? Which of our rivals have these sorts of protections?
Well, thank you, Mr. Stephen Mayne, which I didn't know your middle name, Stephen, so this is a first piece of new information. Look, I mean, I think there are two slight different points you're making in your lengthy question. One is, why is there a dearth of companies listing on the ASX? I mean, we just aren't producing enough innovative new companies, would be my simple summary to that. Are they staying private? It's possible. But I just don't think we have quite right, the right levers to create new entities, and therefore, it's proving difficult for the ASX to replenish those who were taken over.
Many of them taken over because the reality is they've got limited growth options, and they're geographically constrained, and there are larger competitors internationally who find an opportunity to buy them and help integrate them into a global framework, and you can't hide from globalization. You know, we're one of the few that escaped the traditional realities that you get bought. You get to a size, and you get bought. So the good news is, we escaped, and so, Stephen, it's nothing to do with the legislative protections. It's because we performed really well, and to be frank, my view is performance is the only protection, only protection for any company, including CSL. We must continue to perform.
Whether a big, big company one day, a mega company, turns up and makes an offer that the board and the shareholders feel are attractive, that may or may not occur. I think if, you know, this, it's a serious check to buy CSL. This is not. So there are only a small number of companies who could do it. But if you're that big, I'm pretty sure you'd be pretty influential in Canberra as well. So I would've thought if someone was to turn up, and they're pretty good, and they offer shareholders value, I, I think it's, it's all possible. So I don't see the narrow legislative limits on international investors, foreign shareholders, at all limiting someone buying us, particularly if we don't perform. Performance is the only protection. Thank you.
Okay, we have another question from Stephen Mayne. Over his 30 years plus at CSL as CEO and then chairman, why has re-election candidate Brian McNamee never done a material divestment or demerger? BHP has done three demergers of BlueScope, OneSteel, and South32 over the past 25 years. Does Brian agree that a demerger would be an easy way to get around the increasingly ridiculous and anachronistic legislative and constitutional takeover restrictions that apply, that tie CSL to the ASX, where we generate less than 10% of our revenue here? Also, as things stand today, health permitting, is Brian currently intending to stand for re-election again in 2027, or is this likely his final term on the board?
Stephen, you've been busy. So there are two comments I'd make. Actually, if you look back to the history of CSL, we made a couple of significant divestments as we narrowed our interests. Without going into too much detail, our first international expansion was in an activity called cell culture, which is a biotechnology activity. We bought a business in the U.S., then the U.K., and it was extremely successful for shareholders, where we probably invested 20 or 30 million dollars, and we sold these businesses to international companies for nearly $350 million. So I think we made 20 or 30 times our money on that. That's a lot better for shareholders than listing on the stock exchange, that business. Same with animal health. We had a great animal health business here in Australia.
I mean, I love the vets. Who doesn't like vets? You know, what good people they are, I think, anyhow. So we loved our vets. We loved our vets, and we really liked our animal health business, but it was really narrow and small, and, you know, we were sheep and cattle at best. So we really decided we had to, again, Australian market was competitive. We had a really good, difficult competitor in Sydney called Websters, another, Smith Kline were here as well. Competitive market, and I can assure you, there's no tougher customer than an Australian farmer. I mean, they're tough. They're tough people. They, you know, they buy cheap because it's a tough game. They do a great job. So we learned our animal health business in a really tough operating environment. That's the good news.
We'd learned how to be, run a business in that environment. We then expanded. We bought a business in New Zealand to complement it, and then the US. Again, but we ran out of runway against the larger international companies. What would've been better to do? List it to shareholders? I don't think so. We sold incredibly successfully to Pfizer at a huge premium that was very good for our shareholders. So I'd say, actually, I've done a couple of pretty good divestments in my time. And then we narrowed our focus to human health, and particularly biological products. I mean, people think plasma is different to vaccines. Well, they are and they aren't. I mean, they've both got similar competitive economic environments.
How you make the protein, whether it be a vaccine protein or a plasma protein through separation, the patient doesn't care, the customer doesn't care. You're still working in proteins. Same with monoclonal antibodies. So to some degree, how you make proteins was the convergence of the company, and that's how we ended up in plasma proteins, vaccinology, and then Vifor. We like these complex areas of manufacturing and proteins. So, look, I think that's how we ended up with our portfolio.
We're not in small molecules. We don't do skincare. We don't do lots of stuff we haven't done because we're quite clear what we're good at. As for me, goodness knows. I mean, in 2027, it's very nice Stephen's confident I'm gonna be well. So we'll see. We'll see what the board thinks. We've got great talent on the board. We're getting new talent on the board. This can't be for the term of my natural life. I think that would be unhealthy. So time will tell, I think, on what I do in twenty twenty-seven. Thank you.
We have one more question from Miss Kathy Skliros: Is there an opportunity or interest from CSL to look at rheumatic diseases? Thank you, and thank you for all you do.
Look, I think it's fair to say that we would see rheumatic diseases in the broader immunology inflammation area, and so in fact, we do have interest in that field. And to be honest, it often, you don't know where the science takes you sometimes. I mean, that's the other reality. As patients and clinicians, we look at diseases, but as scientists, they're looking at mechanism of action and trying to change what happens in the human body by affecting a receptor or an antibody or a protein or an enzyme. So it is certainly not out of the question that some of our work may well be relevant to rheumatology. But you don't see it because, as to date, the projects we're working on are probably more appropriate for other diseases at this stage.
Okay, that's all the questions that we have for the meeting today. We can-
Okay, fine. Thank you. Good. Where am I up to, then? Fiona, are there any verbal questions from the online platform?
No.
No. Fine. Thank you. We're good. Sorry, I'm just reading a little prompt here. Thank you. So, ladies and gentlemen, that concludes our discussion on the items of business. While we wait for those of you to finalize your voting, we will share with you a patient video. Please ensure that you have cast your votes on all resolutions. The video features Peter Dyson, who's a hemophilia patient of ours. Thankfully, Peter and many other hemophilia patients can manage their treatment with CSL products. You can read more about our purpose, including how the science and the people of CSL save lives, in our annual report, which is available on our website, csl.com. Thank you, Peter, for sharing your story with us today.
The poll will close formally 10 minutes from when I declare the business of the meeting closed, and the votes will then be counted, and the results of the poll will be reported back to me as required. We'll also put them on the ASX as soon as practicable following the meeting. For those in the room, I now ask the Computershare representatives to collect the red cards, which record the voting instructions on the poll. Please forward the red cards to the end of each row, if that's helpful, so they can be collected. There'll also be ballot boxes near the exit of this room if you need more time. I will now declare the meeting closed.