Good morning, ladies and gentlemen. I'm Rob Sindel, Chair of Orora Limited, and I will chair the meeting today. On behalf of the Board of Directors, I'm pleased to welcome you to the tenth Annual General Meeting of the company. We're holding today's meeting as a hybrid meeting, so I welcome shareholders joining us online and those of us in here in person today. I appreciate you, spending the time with us. Firstly, if you have a mobile phone, please ensure it's switched to silent for the duration of the meeting. Could I also ask that no photographs or recordings of the meeting be taken? A recording of the presentation will be made available on the Orora website shortly. As we have a quorum, I now declare the AGM open. A notice of meeting has been distributed to shareholders, and I'll take this notice as read.
In attendance today and present in the room are Brian Lowe, Orora's Managing Director and CEO; Ann Stubbings, Company Secretary and Group General Counsel, and my fellow directors, Abi Cleland, who's standing for re-election today and will address the meeting shortly. Also, Tom Gorman, Sam Lewis, and Michael Fraser, whom shareholders will know. We also have some members of the Orora senior executive team here, and I invite each of them to stand as I introduce them. Shaun Hughes, our Chief Financial Officer. Thank you, Shaun. Matt Wilson, our Chief Strategy and Corporate Development Officer. We also have our company auditor, Penny Stragalinos , joining us here today from KPMG. Thanks, Penny. And Penny will answer any questions for the auditor at the appropriate time during the meeting.
Before addressing the formal items in business, I will recap on the major company achievements during the 2023 financial year, including our financial highlights, our approach and progress on our sustainability goals, and an update on our strategic initiatives, including our recently announced acquisition of Saverglass. Brian will also provide additional comments on our safety and operational performance, sustainability achievements, and progress against our strategic roadmap. Brian will also provide an outlook for our financial year 2024. Two of our directors, Abi Cleland and Sam Lewis, will have accumulated 10 years of committed service to Orora during this current financial year. Our board charter provides that non-executive directors will resign at the AGM following the 10th year of service, except in exceptional circumstances.
In light of the recently announced acquisition of Saverglass, we are mindful of ensuring an orderly board succession and transition. Therefore, Abi, who is standing for re-election today, will remain on the board past the next annual general meeting. However, will not stand for re-election at the end of her three-year term. Having stood for the re-election at the last AGM and to ensure orderly board succession, Sam Lewis will step down from the board before the next AGM. Our overriding objective is to ensure we continue to have an appropriate mix of skills, experience, knowledge, and diversity. Turning briefly to our financial results for the year ended June 30th, 2023. Orora again delivered on its operating plans and strategy, reporting another solid increase in group earnings and underlying earnings per share.
This was driven by double-digit earnings growth in North America and another resilient in earnings performance by our beverage business in Australasia. Underlying earnings before interest and tax increased by 12.3% on a reported basis, driven by a significant increase in North American earnings, up by 23.9%. Underlying net profit after tax was up 8.5% to AUD 203 million, and underlying earnings per share increased 11.1% to AUD 0.241 per share. Cash generation remains strong, with underlying operating cash flow in line with the prior year at AUD 270 million and cash conversion of 70%. The board declared a final ordinary dividend of AUD 0.09 per share, unfranked.
This brought the total dividend in FY 2023 to AUD 0.175 per share, a 6.1% increase in FY 2022. This represented a total dividend payout ratio of 72.6%. Post the sale of our fiber business in 2020, underlying EBIT and underlying EPS have delivered compound annual returns of 12.6% and 22.2% respectively. Over the same period, Orora has grown revenue to almost AUD 4.3 billion and delivered strong growth in dividends. This strong operational performance, combined with our growth in earnings and dividends, has enabled us to continue our capital investment program, particularly in new aluminum can capacity. This has delivered solid growth in volumes, which continues to grow our cans earnings as additional capacity comes online over the next few years.
Orora redefined our sustainability framework in FY 2022, defining clear goals under the pillars of circular economy, climate change, and community. During the year, we continued to make progress against all three of these goals. Under the circular economy pillar, we invested AUD 25 million to increase our recycled glass content at our Gawler glass manufacturing plant in South Australia. In North America, further progress was achieved on recycled content, particularly in corrugated board, board manufacture. Transitioning to a low carbon future is a challenge for many manufacturing companies. Financial year 2023 data shows further decreases by Orora against our baseline of FY 2019, and a marginal decrease in emissions compared with those recorded in the previous year. We remain on track to achieve our interim goal of a 40% reduction in greenhouse gas emissions for Scope 1 and Scope 2 emissions by 2035.
During financial year 2023, we began our examination of Scope 3 emissions for Orora, and we'll continue this work during the next 12 months. Step change, however, will come through investment in new technologies, and pleasingly, we have begun construction to upgrade the G3 furnace to oxy-fuel technology at Gawler. This upgrade will position the G3 furnace in the top 10% energy efficient glass furnaces worldwide, delivering a 20% reduction in CO2 emissions. Construction of the oxygen plant is due for completion in FY 2025. We also welcomed government funding of AUD 12.5 million through the Modern Manufacturing Initiative to support this project. Our review and implementation of findings from the Task Force on Climate-related Financial Disclosures was published during the year. No material risks were identified, with our strategy determined to be fit for purpose and supportive of Orora's long-term sustainable growth.
Brian will shortly provide further details on our sustainability achievements during the last financial year. As with sustainability, good corporate governance is integral to the culture and business practices at Orora. It enhances performance, creates value, and supports an appropriate risk and return framework. Orora's governance practices are summarized in our corporate governance statement, which you can find in our FY 2023 annual report or on our website. Now, Orora continues to present compelling investment proposition to our valued shareholders and investors. This is underpinned by our company's clear strategy and consistent performance, and the differentiated value we offer as a design-led, sustainable packaging solutions provider. On that note, the board are very supportive of the recently announced acquisition of the premium global glass manufacturer, bottle manufacturer, Saverglass.
This marks a significant milestone for the company, representing a unique acquisition of a market-leading business with a consistent growth profile and robust financial performance. The addition of Saverglass is set to offer a significant growth platform and value creation opportunity for our shareholders. In September, the company successfully completed the fully underwritten equity raising comprising 450 million in an institutional placement and 895 million pro rata entitlement offer, raising of AUD 1.35 billion. We very much appreciate the support shown by existing and new shareholders for the acquisition of Saverglass. Our CEO, Brian, will talk further about this exciting news shortly. In closing, despite continuing global economic challenges, Orora remains well positioned to achieve long-term growth for shareholders, as we have done since our inception a short 10 years ago.
The acquisition of Saverglass represents the next significant step in the company's evolution, and I extend my gratitude to Orora's executive and its leadership team, and all of our global team members for the outstanding contribution and the delivery on the strong results in FY 2023, including an enormous amount of work on the Saverglass transaction. As Orora approaches its tenth anniversary, the board is very excited as we move into the next chapter of growth for the company. I'll now hand over to Brian for his comments. Thanks, Brian.
Thank you, Rob, and thank you all for your continued support of Orora. The health, safety, and wellbeing of our people remains a fundamental and ongoing commitment at Orora. Lost time injury rates remained relatively stable year-on-year. However, we experienced a disappointing increase in the frequency of largely preventable, low severity injuries in FY 2023. One serious injury was regrettably recorded at our glass facility. Extensive risk assessments have been undertaken and proactive controls implemented. In FY 2023, we embedded the final elements of the Global Integrated Safety Improvement Program, or GISIP, into our FY 2023-FY 2025 global health and safety strategy, which is focused on high-risk activities, improving effectiveness of critical controls, incident reporting, and governance processes.
Our Stay Safe rules were also communicated across all of our global operations this year, targeting ten high-risk activities to reduce and empower team members to stop work and speak up at any time if they believe conditions are unsafe. We are confident safety performance will improve through focused, continuous improvement and driving existing programs. This includes the implementation of critical control checklists in FY 2024, to verify critical controls for our highest risk activities are in place and effective. I am pleased to report the first three months of FY 2024 has seen a substantial reduction in both lost time and recordable case injuries. This result again demonstrates the continued execution of our strategy, strategic priorities, and embedded pricing discipline. In North America, we delivered another strong earnings performance, with EBIT up 15% in local currency terms, largely driven by strong performance in our OPS distribution business.
This result reflects the continued improvements in operating efficiency and cost to serve, while ensuring strong pricing disciplines to manage inflation. Sales revenue was down in the OPS manufacturing business, having experienced 12 months of lower volumes, reflecting the decline in the broader North American manufacturing industry, and the flow-through impact of lower paper prices. The distribution business also saw volume softness in the second half of FY 2023. This was partially offset by some price increases, as well as cost management activities, which were proactively deployed to partially reduce the earnings decline. While softer trading conditions impacted OPS volumes in FY 2023, the business remains well-positioned to drive earnings growth from any improvement in the U.S. economy.
Importantly, the benefits of our sustained and disciplined approach to operating efficiency and tight management of inflationary pressures increased the North American segment EBIT margins by 90 basis points to 5.1%, with the OPS business now at 5.9%. In Australasia, revenue was up 14.1%, driven by 2.7% net volume growth, 3.5% relating to higher aluminum costs that are passed through to customers, and 7.9% from price increases and positive product mix. Australasia's EBIT was in line with forecast, up 1.8% on the prior year. This was driven by approximately 10% sales volume growth in cans across all formats, which offset the softness in glass volumes. Pleasingly, revenue and earnings from new glass products were all higher than the prior year.
Importantly, the Australasian business returned to growth in the second half of 2023, growing underlying EBIT by 8.5%, primarily from cost inflation recoveries. The FY 2023 result underscores the resilience and diversified strength of the Orora Beverage business in Australasia, with strong consumer demand for cans driving volume gains and product mix improvements. This offset a softness in glass due to a slowdown in domestic and export consumer demand for Australian commercial wine and beer. Our strategy continued to guide our actions, supporting the delivery of our achievements in FY 2023. In North America, OPS has driven further improvements in financial performance and operating discipline, and is investing to drive long-term volume growth with an increase in sales resources.
Our beverage business in Australasia has focused on operational excellence, automation, and lean manufacturing programs, which have led to productivity gains to deliver strong volume growth in cans. Our cans growth investments are well advanced, with stages 1 and 2 completed, comprising the cans ends capacity increase at Ballarat, and our new multi-size canning line at Dandenong, both now operational. Looking at our FY 2024 priorities, OPS will continue to optimize the business and focus on driving customer account profitability, as well as leveraging digital platforms to further streamline processes. Continuing to invest in the OPS sales force remains a focus to drive long-term growth. The beverage business in Australasia will further its cans capacity expansion, with the second canning line at Revesby in New South Wales progressing well and due to come online in the second half of FY 2025.
Product mix will continue to be optimized as the business diversifies its portfolio, and the business will benefit from the ongoing preference shift towards canned formats. And as Rob mentioned, a significant development was the announcement on September 5th, that Orora will acquire premium global glass packaging business, Saverglass. This is the culmination of four years of disciplined execution of our strategy, positioning Orora for the next phase of growth. This is a particularly exciting milestone that will establish Orora as a truly global, diversified, sustainable packaging solutions provider. Saverglass is a global leader in the design, manufacturing, and decoration of high-end bottles for the premium and ultra-premium spirit and wine markets. It has an extensive manufacturing footprint with specialized assets and technical capabilities across six sites in Europe, North America, and the UAE, in close proximity to key global production regions and customers worldwide....
With over 50 years of craftsmanship, Saverglass is a long-term partner for some of the world's most well-known names in luxury wines and spirits, many of which you will instantly recognize. Their exclusive designs, quality, and craftsmanship are critical to the brand recognition and success of their customers. The acquisition price is EUR 1.29 billion, or approximately AUD 2.15 billion. As Rob mentioned, we have successfully completed the AUD 1.35 billion equity raising and are well progressed on the acquisition debt financing. The Works Council consultation processes have successfully completed. The share purchase agreement has been executed, and we are working towards completion of the acquisition in the final quarter of calendar 2023, and we will update the market in due course.
Our current expectation is that due to the timing of regulatory approval processes, completion is likely to occur at the end of December, with earnings to flow from January 2024. Orora's acquisition of Saverglass is strongly aligned to our growth strategy and provides valuable future growth avenues for the combined group. It grows our core competencies in premium, value-added beverage packaging capabilities and provides geographical diversification and meaningful scale benefits to our existing glass assets. Saverglass unlocks significant value creation opportunities for the combined group, leveraging complementary operational footprint, sustainability practices, and customer network. We also gain access to a highly capable management team with significant experience in leading a global network of glass manufacturing sites. Importantly, this is the acquisition of a well-invested, established business model with a historically consistent long-term growth profile and robust financial performance.
This will enable us to optimize production and leverage the combined expertise. During FY 2023, we continued to make progress towards our Promise to the Future sustainability goals under the pillars of circular economy, climate change, and community that we announced back in FY 2022. Key sustainability achievements included: under circular economy, we achieved 38% recycled content in our glass manufacturing. This was in line with the prior reported period. However, more than 30,000 tons of new cullet sources were developed during FY 2023, with our cullet sourcing program now active in all mainland Australian states. This will further increase levels of recycled cullet in our glass containers during FY 2024, as we strive towards our target of 60% recycled content by 2025.
In North America, OPS averaged 57% recycled content in our corrugated board manufacturing, an increase of 3% from FY 2022. We also continued to explore new ways to utilize and maximize recycled content across the range in OPS. Under climate change, total Scope 1 and 2 greenhouse gas emissions decreased by 4.84%, utilizing market-based factors for Scope 2, and 12.98%, using location-based factors for Scope 2 from our FY 2019 baseline year. We have also begun our examination of Scope 3 requirements for Orora, and this will continue during FY 2024. We also commenced our G3 furnace rebuild, utilizing an Australian-first oxy-fuel technology at our glass manufacturing plant in Gawler. When commissioned, this will deliver a step-change reduction in greenhouse gas emissions for that furnace.
Along with the board and the executive leadership team, I am extremely proud of the dedication from our people in executing our Promise to the Future. Finally, before I hand back to the Chair for the procedural part of the meeting, I'd like to cover Orora's outlook for FY 2024. In North America, as anticipated, volume softness in the second half of FY 2023 has continued in the first quarter of FY 2024, and these trading conditions are expected to continue into the second quarter. This reflects the ongoing slowdown in the broader North American manufacturing industry. OPS remains well positioned to drive earnings growth from any improvement in the US economy, with further margin accretion through account profitability programs and the continued focus on cost management expected to be largely offset by ongoing volume softness.
In Australasia, continued strength in cans with incremental volume growth from recent investments is expected to offset the ongoing softness in glass from lower commercial wine volumes. While global and domestic economic conditions remain uncertain, Orora Group earnings are expected to be higher in FY 2024, and this statement excludes the impact of earnings from Saverglass, which are expected to flow once the transaction completes. This outlook remains subject to global and domestic economic conditions and currency fluctuations. With that, I'm going to hand you back to the Chair for the procedural part of the meeting. Thank you all.
Thanks, Brian. Well, I'll shortly introduce and invite questions from the floor and those online. We have people joining on the platform, we have telephone, and we obviously have you in the room. So we've tried to provide maximum access for our shareholders to be part of the meeting today. However, before we jump into it, I'll give you a bit more detail of how that's going to work, and both in terms of voting and the procedure for that. For those attending in person, you in the room, when you registered this morning, you have received an admittance card. Yellow cards were issued to shareholders and proxy holders who are entitled to vote today. Blue cards are for those shareholders entitled to speak, but not to vote.
You will all need to have either of these cards to ask a question or reenter the meeting. The yellow card displays a series of boxes for voting. Please remember to indicate on your card how you wish to vote by marking the appropriate box. Visitors at today's meeting have been issued with red cards. That doesn't sound like a very good color, does it? I remind visitors that they're not entitled to speak or vote at the meeting. The resolution at today's meeting will be decided by a poll. For those attending virtually, if you're eligible to vote, you have registered online as detailed in the virtual meeting online guide. If you are eligible to vote, you will also have received a virtual voting card.
I encourage you to review the online platform available on the Orora AGM link or on our website for further information. Julie Stokes. Where are you, Julie? Julie Stokes of Link Market Services will act as the Returning Officer in relation to the poll. The results of the poll can be obtained later today by visiting the company's website or the ASX website. So also, as usual, subject to a director having a personal interest in the outcome of the resolution, I confirm that the board recommends that shareholders vote in favor of all resolutions today. As Chair of the meeting, I intend to vote all undirected proxies given to me in favor of each resolution. Now, I will invite questions from shareholders and proxies on all items of business. However, we will not pause between each resolution.
We'll do that at the end of the resolutions that I'll put to the meeting. If you wish to ask a question, please ensure they are relevant to the meeting today. Questions on all items of business will be fielded through me as the chair, and I'll direct it to the appropriate person if, if I'm struggling. I'll first invite questions from those present today, followed by written questions from shareholders joining the meeting via the webcast, and then any telephone questions. So for those shareholders present today, if you would like to ask a question, please move to one of the two microphones at the side of the room and show your card to the microphone attendant. The microphone attendant will invite you to speak when your turn comes.
If you have more than one or two questions, I ask that you allow others to ask questions before returning to the microphone. Again, for shareholders joining us via the webcast, all the information you need is on your screen. If you're having any trouble using the online platform, please refer to the guide or call the telephone number shown on the assistance screen, shown on the screen for assistance. If you'd like to ask a question online, I encourage you to do so as soon as possible so that it can be addressed at the relevant time. Please click the Ask a Question button and follow the instructions. We will endeavor to answer all questions. However, if there is repetition in any questions lodged, we may consolidate these questions via the telephone line.
Penny, as I said earlier, Penny Stragulinas from KPMG is also available to answer any questions of the auditor. I will now, meeting as set out in the notice. I also declare the poll open, so that those of you who need to leave early can complete your voting card and place it in one of the ballot boxes near the exit doors. The first item of ordinary business is the tabling of the financial statements for the year ending June 30, 2023, and the report of the directors and the auditors of the company. These reports will be tabled but are not subject to a resolution. We'll now move to the second item of business, the re-election of Abi Cleland. As stated in the notice, Abi Cleland retires by rotation and being eligible, has nominated herself for re-election.
The details of Abi's qualifications and experience are set out in the notice. However, I'd like to ask Abi to say a few words.
Good morning, shareholders. It's been more than nine years since I joined the board of Orora, just after the demerger from Amcor. It has been an honor to represent shareholders during this time. The business looks quite different today than back then. We've invested in our people and culture. We've expanded and strengthened the Australian glass and cans business, as well as successfully sold a low-returning cartons business. The North American OPS business now has much stronger foundations after investing in our core systems and processes. Recently, we bought the Saverglass business, which builds on the 50% of Orora's profit already offshore. Our focus now is to successfully integrate and run the business, and our CEO and the executive team are motivated and committed. I'm currently a full-time non-executive director, and I'm also on the boards of Coles and Computershare.
Prior to this, I built a global career driving strategy, M&A, digital, and running businesses for large corporates in industrial and retail sectors, as well as running a successful advisory firm. With your support, I look forward to continuing to work with my fellow board members, CEO, and executive team as we embark on Orora's next-gen phase of the journey. Given my tenure, as Rob said, I will retire during this term. Thank you.
Thanks, Abi. It's a really good summary of where you've seen the progression of the company over the last 9 years. So I put the motion that Abi Cleland be reelected as a director. So shareholders, will you please complete your yellow voting card in relation to item 2, or those of you voting online, please submit your votes virtually. Anyone who needs assistance with the voting process, please raise your hand to attract the attention of Julie Stokes or one of the team. Great. Julie, up the front here. Thank you. So we've seen the proxies, the votes up there. Good support for Abi. Well done. So moving to item 3 in the notice of meeting, the incentive grants to Brian Lowe. The board proposes a grant to Mr.
Lowe under the terms of the company's short-term and long-term incentive plans, as summarized in the notice. As required by the ASIC listing rules, shareholder approval is being sought in order to grant the proposed securities to Mr. Lowe. Mr. Lowe has not participated in board discussions on resolutions concerning these grants. Each of these grants will be considered separately. Turning first to the short-term incentive grant to Mr. Lowe. Shareholders are asked to approve a grant of deferred share rights to Mr. Lowe, as set out in the meeting. This grant is designed to reward the achievement of specific objectives for the 2024 financial year. Any short-term incentive granted to Mr. Lowe is also subject to Orora's safety performance. Importantly, the board has overall discretion in granting the proposed short-term incentive grants to Mr. Lowe.
Again, I'll now disclose the way in which proxy votes have been directed on this item. Thank you. I put the motion under three, item 3A , that Brian Lowe be granted deferred share rights under the short-term incentive plan. Again, shareholders in the room, will you please complete your voting card in relation to item 3A , or on your online voting card for those virtually joining the meeting? Turning now to the long-term incentive grant to Mr. Lowe. Shareholders are asked to approve the grant of performance rights as set out in the notice of meeting. Again, I'll now disclose the way in which proxy votes have been directed on this item. I put the motion under item 3 B, that Brian Lowe be granted performance rights under the long-term incentive plan.
Would you please complete your yellow voting card in relation to item 3B, or your online voting card for you, those joining virtually? Thank you, shareholders. The fourth item in the notice of meeting is the remuneration report. In accordance with the Corporations Act, the directors have prepared a remuneration report for the financial year ended June 30th, 2023, which is included in the annual report that has been made available to shareholders. Orora's executives are rewarded for annual performance against business plans, as well as longer term returns for shareholders. Incentive planned outcomes for this year again reflect the strong alignment between Orora's financial performance, executive performance, and the execution of the company's strategic business objectives. This year in the remuneration report, we outlined modest adjustments to the executive remuneration framework for financial year 2024.
We've introduced cash-settled dividend equivalent payments on the deferred equity component of short-term incentives and removed the absolute total shareholder return gateway on long-term incentive plans. The long-term incentive plan will continue to have earnings per share growth, return on average funds employed, and relative total shareholder return performance metrics. These metrics align with Orora's goal to provide superior returns to shareholders. In accordance with the Corporations Act, the vote on the remuneration report is advisory and non-binding. I will now disclose the way in which proxy votes have been directed on this item. I put the motion that the remuneration report for the period ended June 30th, 2023, be adopted by passing an ordinary resolution, an ordinary advisory resolution, as set out in the notice of meeting. Shareholders, will you please complete your yellow voting cards in relation to item four?
Again, those online using the virtual tool. Great, thank you. I think that's the formal part of the business other than the question and answer. I encourage shareholders to ask as many questions or any questions on any topic, and we'll do our best to address those. So, are there any questions starting in the room? Yes, sir. If you could state your name to the moderator or state it at the microphone, that'd be very pleasing.
Chair, may I introduce Stuart Reid?
Good morning, Chair. Still morning, yes. I'd like to ask a question about the possibility of having a fully franked dividend rather than a partially franked dividend some time in the future.
Yeah.
I know the takeover of Saverglass will probably make it more difficult, but in terms of the takeover of Saverglass, is it intended that their management continue in Saverglass, or are we putting our own management team there?
Okay. Thank you, Mr. Reid. Appreciate both those questions. The first one, it's a couple of years before we'll pay a franked dividend. The reason is, the accelerated depreciation we get in Australia means that we're actually not paying tax in Australia, so that's a positive for shareholders, but it does mean that, franking will be a couple of years off, Shaun.
Yep.
On the second issue, on Saverglass, one of the key considerations that Brian and the management team had to think about was: how do we maintain what is a very stable and global management team? And we're very pleased to say that that entire management team is very excited to work for Orora. They see the opportunities, particularly in North America, where they now have a North American... It's based in Mexico, but it's a North American based glass business, and we have our big presence in North America. So that distribution business, we think will offer significant opportunities. In answer to your question, the entire management team has agreed to stay. We'll come up with some incentives, as we do for most of our management, to encourage that.
Early indications are very pleased to be joining Orora's global management team. Thank you, Mr. Reid, for your question.
Chair, may I introduce Brett Morris from the Australian Shareholders Association?
Thank you very much. Australian Shareholders Association, we're the voice of retail shareholders. Congratulations to the board and all the staff on a year of hard work and the results you have achieved. And thank you for Ann Stubbings for meeting us a few weeks ago and answering some questions, and she did the same thing last year, so we're always very grateful to meet before. My question is just in relation to the... Generally in relation to environmental reporting becoming a bigger and bigger issue.
Yeah.
I see that Orora has really gone to a great length to report on water use, emissions, recycling, and a whole range of other factors, not only in the report, but also on the website. I was having a chat to some other companies over the last few years, trying to encourage them to do that, and of course, Orora's got much bigger implications for emissions and recycling, and those sorts of things. So it's really good to see the reporting, and it appears that you've gone beyond the statutory requirements, which is great to see.
Just in relation to the hurdles that have been set, so just picking a few out, 60% recycled glass, recycled content for glass by 2025, 40% reduction in emissions by 2035, and zero emissions by 2050. I'm just interested in... They're obviously targets that are set to be achievable, but I'm just wondering whether they're ambitious enough in the-
Yeah
... in the world we now face. Shareholders are gonna be interested, how hard are we pushing to those? Can we do better? And it's not to say that Orora is not. It's certainly reporting on it. It's looking like it's doing the best job it can and really pursuing some great targets. But just, is there greater scope to work on that and achieve that sooner, I suppose?
Thank you, Mr. Morris. Appreciate the question. It's something that we focus on enormously as a board, and we have a sustainability and safety committees to... We formed that a couple of years ago to make sure the emphasis at board level was on the topics you're talking about. As it relates to Orora, our biggest emitter in Australia is the Gawler plant, and to give you an example of the decision the board had to make, we replace those furnaces or rebuild those furnaces about every five to seven years, depending on the work that's, you know, the volume that's gone through.
So we stared into a decision, AUD 90 million to do exactly the same thing and rebuild it, or AUD 140 million to take globally, the best technology globally, which is the oxy-fuel technology. So it's AUD 50 million of your money that we said, "This is a better decision because you'll only make big..."... change by technological change. The, the technology exists. So what gave us the confidence as a board to spend that additional AUD 50 million of shareholders' money? We think our consumers, ultimately, that buy those bottles, that buy that wine, that buy that beer, will be prepared to pay a little bit more on the basis that that is a more sustainable product.
So if we can have increased cullet content by container deposit schemes, which has just started in Victoria, which is fantastic, that cullet gets picked up at your home, hopefully ends up at our Gawler manufacturing plant, increases the recycled content to 60%, and then goes through a furnace that's 20% more, you know, lower emissions. So that's the way we think about it. That's the practical example. To do that every year is difficult. It's technological change. The next furnace, I can assure you, our thinking around the oxyfurnace is to make that big enough that we can then use our other furnaces to do the same thing. So that's a practical example. Anything you wanna add, Brian?
Just, just in terms of the, you know, trajectory for the reduction by 2035, you know, that's a well-planned-out process that we've got. So we've got clear line of sight of what we need to do to achieve that, and we want to make sure that we, we set a plan that we knew we could execute on, not just a, you know, aspirational target. You know, beyond that, a lot of work is going on alternate technologies. One of the benefits of the acquisition of Saverglass is we actually have a lot more scale now and a lot more technical capability that is being deployed to what are those next step technological changes that'll take us beyond that 40% reduction and towards zero. So I think that scale is a really positive thing for us.
There will need to be some technological advances to achieve that, but they're well in train, and particularly in Europe, so us having a European presence now, we think is a real positive.
Thank you, Mr. Morris. Appreciate the question. Any other in the room? Okay, we have you. We'll give you the opportunity at the end to come up if some of the others twig your interest. So we will go to the questions online. Angela?
Chair, there are no questions online or on the phone.
Thank you. Okay, are there any further questions from shareholders in the room? So Julie, I'll just ask that everyone's had the opportunity to cast their vote. Anyone still waiting to cast their vote, there's a-- I'd ask you to put your hand up so we can collect those voting cards as the share registry team move through the room. It feels a bit like the old church plate, Julie, doesn't it? Not as profitable, though. Exactly.
A challenge, is it?
Thank you. I think there's one team we have in place. We're looking forward to the acquisition of Saverglass. It is, as we said, during the meeting, a really key moment for the organization and will help deliver its next stage of growth. I'd invite all shareholders to join us for a cup of tea or coffee outside, and my colleagues will be available to ask any of those questions that you may like to ask them personally. So thank you again for your attendance, and we really appreciate it.