[Foreign language] Tena koutou, tena koutou, tena koutou katoa. Kia ora.
And good morning, everyone, and welcome to AFT Pharmaceuticals Limited's annual meeting. I'm David Flacks, Chair of AFT. I hope you're all well, COVID-free, and flu-free. First of all, I'd like to draw your attention to this important notice on the presentation, which along with my prepared remarks and the slide presentation, has today been released to both the NZX and ASX. On behalf of the board, thank you very much for attending the 2022 annual meeting. This year we have enabled the option to join the meeting by audio, and we extend our thanks to those of you who have joined by this means. We will be presenting with the slides and as well as being released to NZX and ASX, these are now also available on AFT's investor website.
For those of you who have joined by audio, you'll be able to see these and follow along. Before we start with the formal business of the meeting, a couple of housekeeping points. First of all, I'd be very grateful if you could make sure that your phone is switched to silent, and in the event of an emergency, please make your way through the door which you came through and follow the instructions of the staff. Let me begin, please, by introducing those on stage to you. First of all, Hartley Atkinson, who'll be presenting to you shortly. Marree Atkinson, Anita Baldauf, and Ted Witek. Ted has traveled to us from Canada.
He's visited New Zealand a number of times in the past, but this is the first time that he's been able or allowed to visit us at AFT, so it's been great to have him here for the last few days. Now, Doug Wilson, who's retiring today, is unfortunately not well, so he's not able to be with us. Jon Lamb also is not well today, so could not make it here, but he's listening in to the meeting. Our auditors, Deloitte, are here and available to respond to questions later in the meeting. Actually, I would just like to acknowledge Jason Stachurski, who has completed his five years as our audit partner. We've appreciated his wise counsel and look forward to working with Bryce Henderson, who's here as well. Our lawyers, Palmer Thorntones, are also present.
I'd like to introduce you to some of our management team, our senior management team who are here today as well. Perhaps as I call your name, you could stand up, please. Malcolm Tubby, CFO and Company Secretary. Ioana Stanescu, Director of Research and Development. Vladimir Ilievski, Regulatory Affairs Manager. Louise Clayton, Director of International Business. Marie Keith, our Group Marketing Manager. Thanks, guys. You can find details of all our directors and senior management team in the annual report and also on our website. In terms of today's agenda, the company's constitution prescribes a quorum requirement of five shareholders. As you can see, this requirement's been met. Accordingly, I declare the meeting formally open.
The items of business for this meeting and the resolutions to be considered by shareholders are contained in the notice of meeting, which was sent to shareholders on fifth of July. In terms of the order of meeting, to start with, I'm gonna say a few words, following which Hartley is going to give a presentation, and then we'll then consider the formal business of the meeting and resolutions. In relation to the resolutions, there will be opportunities for shareholders to ask specific questions as we address each resolution in the formal part of the meeting. There'll also be an opportunity to ask general questions after Hartley's given his presentation. At the close of the meeting, we hope that you will join us for refreshments. It's a pleasure again to report to shareholders on another record year for AFT.
Given our consistent record, it's tempting to look back on the year and see AFT's continued growth as a foregone conclusion. While the board and management have always been confident in our strategy and ability to execute, the uncertainty of the past few years have required resilience and resolve. It is also tempting to gloss over the ongoing impacts of COVID-19 as we all seek to move on from the pandemic. While I certainly don't wish to dwell on it, I do wish to acknowledge the many unexpected challenges we have all experienced, not least of which our team here at AFT. The last financial year has not been easy. If there is one message that I'd like you to take from AFT's performance during the 2022 financial year, it is our resilience and ability to continue to grow in the face of adversity.
At the heart of our continued strong performance is our growing and highly defensible Australasian business, which is founded on a broad portfolio of more than 130 clinically proven products for a diverse spectrum of therapeutic applications. As you know, this success has not occurred overnight. This expanding portfolio is a result of more than two decades of careful and deliberate analysis, and then the identification of medicines that will improve patient health outcomes. Maxigesic is a standout success, but we have a broad portfolio of products. For you, our shareholders, our consistent record of success in both in-licensing and the development and commercialization of our own intellectual property has continued to offer investors a rare proposition in New Zealand capital markets. Highly defensible revenue streams with strong growth prospects.
This has enabled directors to announce a dividend policy and indicate that we expect to declare a maiden dividend to shareholders for the 2023 financial year. This is a strong statement of confidence in AFT's future. I'll speak specifically about this further in a few moments, but first I want to turn to the highlights of the 2022 financial year. Despite significant headwinds in all markets due to the pandemic, all regions posted strong revenue growth, and we announced results in line with our earlier forecasts. Annual operating revenue grew by 15.2% to NZD 130.3 million from NZD 113.1 million in the previous year, and net profit after tax rose 153.8% from NZD 7.8 million to NZD 19.8 million. We remain well-funded.
The company has met its targeted net debt of NZD 25 million-NZD 30 million, and we've also continued to retain higher than normal inventory levels as a buffer against the ongoing disruption in the global supply chain. This approach, despite the additional holding costs, has provided considerable support to the company over the last year, largely ensuring continuity of supply across our distribution networks and ongoing sales. We believe this has been a good decision, and we will continue to monitor supply chains as they start to improve globally. Our long-term success is thanks to our people. Fundamentally, AFT is a lean asset-light company that succeeds on the strength of its intellectual property and the relationships our people have with a broad range of organizations around the world, from licensees and distributors through to manufacturers, regulators, and research and development collaborators.
We're proud to have a workforce consisting of many individuals with diverse skills, values, backgrounds, ethnicities, and experience. We employ nearly 100 people around the world, with just over half in New Zealand, about 40 in Australia, and the remainder in Asia and Europe. They come from 30 different cultural backgrounds with a gender split of 61% women and 39% men. They're a talented team that punches above their weight, particularly in relation to medicine development, engagement with global regulators, and product commercialization. Your board has always been impressed by what they've achieved, but more so over the last two years of the pandemic. In the face of COVID restrictions, they've adapted and developed new ways of working and ensured that AFT, as a global pharmaceutical company, has not been disadvantaged by the location of its operations. They've made a tremendous effort, and we thank them.
Today also represents a landmark change in the governance of AFT. A fortnight ago, we announced that independent director, Dr. Doug Wilson, was retiring from the board today. Doug came to AFT in 2012 after a diverse and distinguished career. His first job in medicine was as a nurse at Auckland Hospital during a student vacation. Upon graduating from University of Otago Medical School, he undertook postgraduate training in medicine, blood and kidney diseases, and research. After moving to the U.K., he gained a PhD in hematology and immunology. He returned to New Zealand and was appointed associate professor at University of Auckland School of Medicine, and this was followed by other academic roles. At the age of 50, he had.
He opted for a new career in business, joining the German pharmaceutical company Boehringer Ingelheim, first as its New Zealand medical director and ending his tenure as the company's worldwide head of medical research and regulatory affairs. I list these achievements only to demonstrate the depth and breadth of expertise and capability that Doug brought to the AFT board table when he joined the company. Since then, he has played a pivotal role in AFT's development and success. His pharmaceutical research development and commercialization expertise has been of enormous value to Hartley and the board, and he's also brought to the board table a worldview and a genuine and abiding care for people. He's a prolific author, writing on subjects ranging from the management of asthma and allergic diseases through to children's books and how to age.
He's also a frequent and respected commentator in New Zealand's national media, especially Kim Hill. Doug has brought real insights and commitment to AFT, and it's been a real pleasure to work with him. Each year, as detailed in the board's governance statement, which is published in the notice to the NZX, ASX, and our website, we undertake a rigorous process of self-review. This includes the development of a comprehensive skills matrix to inform board succession planning. It considers each director's experience against identified specific skills as set out in this slide, and also broader governance-related skills.
This process has informed the succession planning of the last few years, including the appointment of Anita and Ted, who bring to the board the international healthcare regulatory and sales and marketing perspectives that have complemented the skills which Doug has brought to the table. Ted actually worked with Doug at Boehringer, and we're very fortunate that he has a broad range of those relevant skills. We also continue to review potential director appointees, particularly those with complementary skills such as regulatory expertise and medical efficacy. Another key development in AFT's governance has been the ongoing evolution of our governance framework to acknowledge and report on the environmental, social, and governance factors that are material to our performance.
This year, we undertook a detailed analysis of the ESG matters that are relevant to our business, and we've established a framework that will drive our efforts to manage the risks to our business and ensure that we're meeting the expectations of our stakeholders. There are opportunities for us to continue to make progress, but undertaking this review has demonstrated to the board that we are effectively managing our ESG risks. Key achievements in the past year relate to governance and supply chain. Specifically, we introduced and implemented a modern slavery policy and an anti-bribery and anti-corruption policy as a supplement to our code of culture and ethics. These changes do not reflect any concern across the supply chain or in our business.
Rather, it is an acknowledgment that codifying and embedding such practices are fundamental to providing assurance to our customers, our people, and our shareholders that ethical, responsible behavior is in our corporate DNA. As an example, and as set out in our modern slavery statement, which is set out on our website, we've been in contact with all our suppliers and partners globally for confirmation of compliance with our modern slavery policy, and we've embedded these principles in our supply and other contracts with third parties. We also monitor existing and new suppliers and partners on an ongoing basis. I would also like to call out our ongoing focus on improving the health of our customers and our continual search for new products and medicines.
We spent over NZD 10 million on further research and development last financial year, and we continued to work with educational and research institutions, including contributing NZD 100,000 to the University of Auckland Medical and Health Sciences Foundation for anesthesiology research. A key focus in the current year is preparation to report our carbon footprint under the new Financial Sector (Climate-related Disclosures and Other Matters) Act, and that'll be in the 2024 financial year. Again, I encourage shareholders to review our annual report, which sets out our priorities and the important work that we are doing to ensure that AFT is contributing to ESG issues. As announced at our annual results, AFT's strong, defensible and growing core and growing international business, built on our unique intellectual property, has allowed the board to announce the introduction of a dividend policy.
The directors expect to declare a maiden dividend to shareholders for the 2023 financial year. This is a strong statement of confidence in our future. The board believes this policy allows the company sufficient headroom to fund ongoing significant growth opportunities that we continue to see. It's also a strong signal to you as shareholders and to future investors of our expectations of the returns that they can expect from their investment in the company. Turning to the outlook for the year ahead. We continue to see considerable opportunities to accelerate growth, and we have significantly increased both our in-licensing and product R&D pipeline activities. We also believe the gradual move worldwide to living with COVID and our ability to now travel across borders to meet with both existing and new customers will allow a gradual return to a more normal trading environment.
There is no doubt that there will be ongoing challenges, particularly around the timing of regulatory approvals and clinical trials, which Hartley will talk more about. At this stage, we continue to expect an operating profit for the year to 31 March 2023 to range between NZD 27 million and NZD 32 million. On behalf of shareholders, I want to thank the AFT team for all they do and what they've delivered. Thank you to my colleagues on the board, including Hartley, for their efforts and commitment to the company's success. On behalf of the board and the company, I'd also like to thank you, our shareholders, for your continued support. I will now invite Hartley to address the meeting.
Thank you, David. Thanks everyone for coming. I'm certainly pleasantly surprised to talk to a gentleman from Nelson, so it's really good that people have come from not just local as well. Look, just to kind of try and give you an overview and not just looking at repeating our prior end of fiscal year kind of results. I'd like to sort of just also add a few details as well. Look, this one, we have put that in before. It's looking at our growth and what was pleasing was despite challenges, we did have growth across all of our territories, be it Asia, International, Australia and New Zealand. It was a challenge with COVID and the shutdowns across our local markets, but also internationally as well.
Things like launching products in new markets, like in Europe, when hospitals were all closed down, was actually very difficult looking back. A lot of that obviously is clearing away now, and we're certainly noticing that, which is important. What we've seen in terms of the revenue by region, at this stage, it is starting to slowly expand on that ex-ANZ part of it. We expect over time, that'll actually pick up. It's not to say that we don't see further growth opportunities in Australia and in the New Zealand market. In terms of profit, as David's touched on, you know, you could see that we sort of had ongoing progress. I mean, clearly, we do have some licensee income that can be a bit lumpy.
We're getting growing gross profit from our trading operations, which are growing quite strongly over a period of time, and that's a more even income. We do also have licensee income as well, which is a relatively lumpy influence. What's been important was really having this strong, diverse Australasian portfolio of products. This particular slide, during the pandemic, we've made pretty good progress with our liposomal vitamin products. That Tesla was a Chemist Warehouse promotion where people buy one of our products, they can go in the draw to win themselves a Tesla, which a lot of people I talked to are certainly very interested in. I mean, it really brought it home, though, that it's very hard to predict going into the pandemic which products would go really well and which ones wouldn't.
You know, some of our very stable products, like Crystaderm, that sell well all the time in pretty good volume, sales actually halved. Because what happened is people didn't wanna go to the doctor. The Crystaderm, you know, it's not a life-saving medicine, but it treats wounds and infections and things like that. But really, a lot of people made the decision that their child had a bit of a scrape, it wasn't too bad, they weren't going to the doctor to sit in the waiting room where they all might catch COVID. So actually the sales halved. While other products, the sales actually improved, like, you know, the liposomal vitamins. So what it really stresses is it was important to have a range of products rather than just relying on kinda one particular product.
Even things, for example, like eye care products, grew really strongly in Australia, and also here. Probably what happened, I think, is people spent a lot of screen time sitting at home on their computers. They got dry eye, and they used more eye drops, you know? It's kind of I mean, if people had asked me and said, "What exactly do you think, you know, based on your knowledge, will happen?" To be honest, we didn't really know. Regardless, having that broad portfolio really helped to give us, you know, protection going forward. And that's important. You know, has been very important. One of our main market at the moment is the Australian market, and we still see a lot of potential for growth.
What happened during lockdown, actually, interestingly enough, was we couldn't travel, as you all know. We actually did a lot of in-licensing work. We got on Zoom, we chased people. They chased us actually as well. We did some out-licensing agreements as well, the other way with people that we'd never met in France, which I had the pleasure of meeting in the middle of February, which is really nice to meet people you've done a deal with, but actually never met them. Importantly, though, we did a lot of in-licensing. We've got 78 new products in-licensed to come over the next kinda three to four years. Even this financial year, going from July till the end of March in the Australian market, we got 24 new products.
That's a big focus of ours, 'cause that's not just something you can kinda click your fingers and say, "We're gonna bring 24 new products in." Yeah, we have done things like we've hired an NPD, a new product development manager, and he's now mainly our launch manager, so he's working on that. We've hired another person to do deals for us, so he's got a legal background. He's a lawyer. You know, so we've made a lot of steps like that, and we see going forward, there is potential to keep on with this in-licensing work on top of our own R&D. We obviously have a lot of R&D ourselves, and we are accelerating that. Basically, if you really wanna go for it, you've got to in-license products in.
You can't develop enough products that you can really go for it within our local markets, especially Australia, and New Zealand. That's really what we've been doing. In the Australian market, we've increased our resources. We do have a lot of resources there. We have 25 pharmacy reps visit pharmacies. We have six merchandisers. We increased our number of hospital reps to six. We originally had about two, so we've increased them to six. We've hired another team as well, who at the moment are a contract team, so they don't appear on our books. We've got another 12 salespeople that visit doctors in the Australian market, and we see that as very important as well. We also have two key account managers that deal with the big clients, say, like Chemist Warehouse or Terry White, those sort of people.
We're increasing that now to three. You know, we have done a lot of investment within that Australian market to build up a strong team because that really will be one of our growth engines going forward. In terms, not to forget New Zealand, where we all live. New Zealand is a smaller market, you know, so we're never going to make or break it based on just the New Zealand market. We have done and we always do long-term plans. We started this years ago. It was something Jon Lamb impressed upon us when he kind of started to work with us. Also, I always knew you had to do it when I was at Roche, and worked there. It was something they always did well.
We'd seen a few years ago, we actually thought New Zealand growth might have leveled out a bit actually, and we thought, "Look, maybe we could sell about NZD 40 million or something like that." Actually, we've realized just recently, actually, that was wrong. There is quite a lot more growth potential. We were pleased to see New Zealand, despite the lockdown, grew from NZD 30 million to NZD 35 million, and we still see there's a lot of growth potential. We're launching 12 new products in New Zealand from July to the end of the financial year. They're not quite as many as Australia, but those products will follow, and we will get further launches in the New Zealand market. We're really pleased with the progress, you know, that we're making here as well.
Certainly, it's made a big difference now the lockdowns have kind of come off. Because what happened is a lot of the pharmacies closed their doors. They'd only let people in one by one. They roped off all the OTC aisles. You couldn't get near them, you know. Then, not surprisingly, OTC sales slowed down. Despite that, we were still able to grow from NZD 30 million to NZD 35 million, which is a really good effort by our sales team and everyone that was involved in that side of the business. Asia. This is probably the one area where we still are getting impacted with lockdowns. Like, we have got a regional office in Hong Kong, which is one of the decisions that we made to open that up. Hong Kong is still, unfortunately, quite restricted.
Like, if you want to go there, you have to go into quarantine. Actually, there's a proper quarantine when they close the hotel door, and they don't let you out at all, for a period of time. It's actually pretty tough. Our person in Hong Kong really has been quite restricted. We're doing the best we can. We are getting growth out of Asia this year. I think, you know, once things ease up, we will get a lot more growth out of Asia. You know, this is our kind of long-term plan. We are getting growth. We've got growth last year, and we are getting growth this year, but I think this one will be the lag one. It'll pick up more kind of, you know, the year after.
We've made a few decisions, like we're pushing the OTC side in Singapore. We've hired a very well-known and very good sales broker called McPherson's, and they're helping us really push our OTC products. We've seen our OTC sales growth pick up quite a lot in that market. We've had good sales in Malaysia as well. You know, just even a couple days ago, we got a quarter of a million NZD order for Maxigesic from our distributor there. You know, certainly things are going okay, but we do see that it'll pick up more. What you can see in Asia, if you're looking at the pie graphs on the right, is you'll see at the moment quite a lot of the business is hospital. Generally, that's sort of what we do.
The hospital business, normally, you can make quicker money, so we start off with that. The OTC is kind of a slower burn, but very sticky business once the brand gets established. The trick is, though, it costs money to get there. If you do hospital and OTC, it's kind of a really nice mix, where you fund the OTC from the hospital, and then the OTC grows over time. We see in Asia, when we look at our longer-term plans, we see the OTC business growing quite a lot. At this stage, you'll notice obviously on the pie chart that it's mainly the hospital. What we've also done is we've started up our Tmall site. Very few companies actually have this. We got a range of about 15 of our OTC medicines approved for official cross-border sale into China.
To say someone like Chemist Warehouse, they might sell vitamins and skin moisturizers, but they can't actually sell the medicines. We actually are allowed to sell the medicines into China. China is one of the world's largest OTC markets, probably the second. Well, not probably. It is the second after the USA. They buy about 28% of their medicines are bought online. Because to be frank, they long before COVID, they had SARS, so they've actually been more used to this sort of thing where they have to buy stuff online. They are a more advanced online economy than we are in terms of the e-commerce part. We do see a good potential. It's sort of a slow build as well.
We've introduced two or three products about nine months ago, and we've been selling those, measuring what sort of things work, what sort of things don't. We're launching another group of products about now, and then we're launching some further products in another few months. We do see good potential. Quite difficult to give someone an exact figure and say, "We're gonna sell exactly this much." Because with China, it tends to be often you get a few hero products, and it is actually very challenging to predict exactly what those hero products will be, 'cause it could be something you're really not expecting, to be honest. Therefore, you build it slowly because if they really like something, they clean you out of stock. Because obviously, it's such a big country. Australia, New Zealand collectively are actually very small in comparison with China. That's that one.
In terms of international, we're continuing to grow revenue. A chunk of this was actually licensing income as well, so there is an element of lumpiness at the moment in the international until it grows bigger, which we do believe it will grow a lot bigger. Basically, it was a tough year with international because especially in things like Europe, we did a few Maxigesic IV launches, for example, into Germany and Austria. Really most of the hospitals in Germany and Austria were pretty much closed down last year because they were busy with COVID and people being sick, obviously, and things like that. Really, it's not a good time to launch a new hospital product to doctors in territories like that. What we've seen, obviously, is that has come back this year as everything's opened up.
I mean, I certainly personally noticed that. I spent five weeks in Europe in February and March and visited a lot of our main customers and manufacturers, et cetera, and things were really moving on fast. We are seeing a big difference now, that is sort of passing. I think almost sitting here wasn't as obvious, you know, that things really were kind of quite stymied in Europe last year. You can see the number of countries where Maxigesic is sold and ordered. Last year was actually relatively flat, to be frank, and this year we're looking to accelerate, and certainly we see, that's what's happening. We are rolling out additional Maxigesic line extensions like the hot drink sachet. In fact, in this case, the first country was Australia, and that's gone really well actually.
We did a lot of work on forecasting, and actually, embarrassingly enough, it sold out in about five seconds flat. Literally despite what we believe was a, you know, pretty reasonable forecast. We've urgently been having to get more stock and kinda air freight it in. It was really nice for us to see that line extension kinda worked really well. Obviously with the moment the cold and flu season actually being pretty good, that's obviously contributed to that, where during the lockdown periods, cold and flu seasons were actually pretty muted really. In fact, they come back with a vengeance, which isn't good for any of us, but as a drug company, it's not all bad, I hate to say, but you know. That's certainly what we've seen.
We've had our Maxigesic IV launches. We've had some additional tablet launches, and it's really just getting those bedded in and then new ones happening. That's what we're working on presently. What the team's really said to me is, gosh, you know, actually being able to get there, get out and meet people again, it makes a huge difference, you know. It kinda sounds silly, but you kinda really notice it. I think our head of R&D, she spent a couple of weeks in the U.S. and the comment Ioana made when she came back is it's just so much easier when you're meeting people face-to-face at the factory that's making our product to discuss the details with them, you know. It really has sort of made a difference. In terms of...
Look, this is the map we show, where how we're progressing. We are getting more yellow over time, where yellow's where Maxigesic has launched. Blue is where it's licensed. We've got a few things in progress presently, where clearly you will look at the map and sort of say, "Oi, there's still a couple of white bits. What are you doing?" We are working on Brazil. We recently had a big American licensing meeting in San Diego called BIO, and we met with a number of parties from Brazil, so we're working on that at the moment.
China, we also are working on that, and we've got various term sheet agreements, and we're meeting with the regulators over there as kind of the first step, and a similar sort of process in Japan as well. Those are really the main sorta areas we're looking to pick up where we're not presently. Obviously it's rolling out across to other areas. I mean, I guess the obvious area that at the moment is a little bit parked is Russia. Probably stay that way for a wee while. You know, look, and just in terms of the new dose forms, we've got a number of them. We've got some new patent positions as well for the line extensions, which is useful. The Maxigesic tablets, the IV, oral liquids.
We had our first European approvals, and we're getting a whole lot more European approvals at the moment, and also finishing off locally in Australia and sort of NZ where the oral liquid is a product a lot of customers ask us about. Certainly I think I mentioned to our staff the other day. I know what struck me is one of our children had their tonsils out and man, they were in pain and actually cried for three days. This is the sort of product that could really help, you know, young patients with a better form of pain relief. We still see it as something really useful. Medicines for kids are very challenging from a regulatory perspective.
Often the regulators complain that drug companies don't provide enough products for children, but they actually also make it very challenging from a regulatory development point of view and pathway to get the products approved. It isn't a simple walk in the park kind of exercise. We are making good progress, and we have at least achieved our first European registrations, and we will get more. As I mentioned, the hot drink sachet we've got a rapid formulation which is a nanotechnology formulation we licensed from a company in the United States. It's faster dissolving is how it works. Generally, paracetamol actually dissolves relatively quickly. Ibuprofen does dissolve slower, and one way to get around that is to have it ground down into nanoparticles formulation. That's what Maxigesic Rapid is.
We've got cold and flu kit, which we recently got approved in Australia. I'm just preparing around that, and had additional patent granted out till 2042, which was nice. We're also completing a dry stick sachet as well, which is quite popular in parts of Europe, like France, North Africa, places like that. They're very keen on these dry stick kind of formulations. That one did definitely get slowed down, unfortunately by COVID. Slowed a few things down, but you know, we're still on track to file that next year. That's kind of the last one. Just in terms then to talk a little bit about kind of new product development, international markets, sort of what's happening to drive growth. As I mentioned before, this NPD, new product development side, has been pretty significant.
When we do sort of look at our plans, we do see we do get existing product growth, obviously, where products are growing and will carry on growing. We do see quite a lot of growth being driven by new launches as well. When we do work it out, potentially, at least 50% or more is driven by NPD. That's been pretty significant. As I mentioned before, we literally have 78 new products coming over the next three to four years into our Australasian market. Some of those products will then go into Asia as well, and with our own R&D, we then use that for the global market as well, outside Australia, New Zealand, and Asia. That's really what we see as growing there.
You can see, we just provide you with a bit of a graph. The pies on the left, we're not random the way we do things. Like, we are working on certain targeted therapeutic categories. We have about seven different areas that we're plugging products into for Australia and New Zealand. Sort of big chunks are like eye care, pain, cold and flu, and then also dermatology is pretty big. In the rest of it, we do have other things like gastrointestinal, medicated vitamins, and allergy. Like, certainly in different markets like New Zealand, we're really strong in the allergy category. Australia, we're really strong in the eye care category, where we have the largest-selling eye drop, lubricating eye drop in the whole of the Australian market. We're number two eye care company.
Even though we're not really a specialist eye care company, we still actually beaten Allergan, which is a very well-known and established eye care company. We're busy trying to catch up Alcon, which is kind of the global giant. You know, we've certainly done very well in that area. That's one of the things that's important, that we're focusing on the drug development side and in-licensing, but we also have to focus and be good at sales and marketing. We're not just sort of looking at one bit or the other. We have to focus on trying to be as good as we can across the whole range. You can see on the geography side, we are predominantly, at this point in time, on that top one, you can see 62% in an Australian business.
I mean, in many ways, I do say to people, and it's not really tongue in cheek. I mean, we are really an Australian company that happens to sit here in Takapuna on the North Shore because we like living here. You know, we are predominantly and think very much as an Australian company. When we license products in, first thing we look at is could this sell in Australia? If it sells in New Zealand as well, that's a nice to have, but number one is, can it sell in Australia? We do totally look at things with our Australian blinkers on, and that's pretty important actually. Over time, though, we see Australia shrinking a wee bit. It's not because the sales go down, in our opinion.
We see that we have got relatively greater growth potential in international and Asia, which split out to be bigger parts of the pie. Look, hopefully that's just given you some idea. I appreciate how some people may get their calculators out and try and work out what the exact number is, et cetera. We're trying to. I guess I would like to give you our exact forecast. We do work on these longer-term plans. Look, I think I'm just trying to give you a bit of an idea without necessarily floating the exact number around, 'cause these things are never cast in stone. We definitely do work to these long-term plans. They're literally product by product, market by market, and we build them up, and we keep coming back to them saying, "How are we going?
What are we doing?" If something's not working as well, we are trying to address it then. We do have quite a rigorous kind of process that we follow. In terms of investing in R&D, this is pretty important. What we've seen is, we were able to finish quite a lot of our Maxigesic R&D, but we don't wanna stop there. We have actually been padding out our R&D portfolio with new projects. We have got actually quite a list of quite low-risk projects, which are the ones we put down here. We are now in-licensing maybe some slightly more early-phase projects that arguably some might say, because they're early phase, could be a bit riskier.
We're trying to balance things out where we have some big shots, which may be a bit riskier. Also, we've got some things that are relatively low risk and relatively simple. There are some quite good things at the moment with the way the climate is that, for example, when we went to the U.S., we met with quite a few people there. And people like the venture capital people and the licensing people said, "Look, there's loads of companies in the United States that normally just keep raising money 'cause they're loss-making. The problem is, now they can't raise any money. The market's really tight." So for us, that's actually a positive thing because we can get much better deals than we ever used to be able to do.
Now is the time to get out your shopping bag and go shopping, and we are shopping. Just to give you one example, I think we've got a project down there. Look, we have kinda coded them because there are some commercial sensitivities, but there's one. Say, if you look at that one in the middle on the bottom called BT, that was a nice example. I mean, that was a product that we acquired the rights for globally. Yeah, it's about a $200 million market. There are very few competitors to it, very few. Really we're not competing against hordes of other products. But literally, we picked up those rights, including all the development work for about three-quarters of a million dollars. It's very cheap.
You know, that was one of the advantages at the moment where the guys we talked to needed the money for various reasons, and we were able to come along and do a deal on very favorable terms, you know. That's really sort of approach where it's nice being profitable, it's nice being cash flow positive. All those sort of things actually give you a lot more opportunities, and we're really trying hard to take advantage of that. Going forward, we typically said we see we'll probably spend about NZD 12 million on R&D. We're not really saying. Some of the big pharma's sometimes take a percentage and say, "We're gonna spend 15% of our turnover on R&D every year. You know, whether we sell NZD 10 billion or NZD 50 billion, we'll spend that much." We're not really doing that.
We're just sort of doing a bottom-up approach. We see about 12 at the moment, but in future, we do have to increase that to 15 or something like that, I think. You know, we certainly would, as long as that turnover has gone up and, you know, profitability is looking all right. That's the R&D side. Just recently, to talk a little bit about this too, I don't know if you saw it or not, but Pascomer is our orphan drug for treatment of facial angiofibromas. We did finish our first clinical study. There was a few things in it that, there was a, actually a very tough FDA-mandated endpoint that we basically didn't statistically meet. But all the other data was actually very, very strong.
What we were pleased to see was on all the other ones bar one, which was related to the primary endpoint, basically we were highly statistically significant improvements. Just look, to give you a feel about what does that really mean. If they have sort of rating scales. In this disease, you can see in this lady, they get like growths on their face. It kinda looks like really bad acne, and it actually gets a lot worse than that and can block up your nostrils and all sorts of things. But you can see this is what was a one-point improvement on most of the rating scales. There's a couple of rating scales. One's called IGA, which is an FDA one. Another's called VASI, which is one they use in Europe.
It was invented in Europe, and they like to use that one. This was using the IGA scale. This lady was a pretty typical example. She had 26 weeks of treatment with Pascomer cream, and she literally went from the one on the left to the one on the right. That is a one-point improvement and typically what that means. I mean, personally, I don't know what you think, but from my point of view and from physicians we've talked to, you know, people say, "If that was your daughter or that was you would think that that's kind of a clinically useful difference for 26 weeks." We're actually pleased with that, even though we didn't meet the FDA endpoint.
We're discussing filing it in Europe, with the European regulator, and we believe we can use the data in other regulatory jurisdictions. With orphan drugs, they do have a rule that, if you are the first one approved, you do get exclusivity for seven years, and that applies in Europe, and it applies in the U.S. We have not got exclusivity in the U.S., so we always did have a problem in the U.S. That doesn't stop us filing in other jurisdictions. Really, that's really what we're carrying on. As a result of the U.S. situation, we'd say, well, Timber Pharmaceuticals, who's our licensee in North America, did actually terminate their development licensing agreement. That might on one hand sound bad. The positive is they actually paid for most of
Well, all of the study, which is about $4 million. We got a free ride, and that's now our data. We did have an agreement with Timber that for outside the rest of the world, they did have a share of some of the sales and some of the royalties. Now because they've terminated, it becomes 100% AFT. It's not, in our opinion, it's not really a bad thing, actually, that Timber's decided they don't wanna carry on because they were very 100% focused on the U.S. and kinda nowhere else. For us, we're obviously still looking at Europe, Australia, New Zealand. Now look, just, quickly, in terms of some numbers.
Normally my CFO does this, so I don't really go in great detail, but obviously it's something that we pay a lot of attention to. The positive thing was, you know, the profit after tax has certainly went up two and a half times, which was nice on the back of 15% revenue growth. We did have some improvement in margin. Look, that's not from hiking prices and ripping people off or anything like that. It's very much a product mixing. As we're selling more OTC products, generally they do have superior margins.
We did improve a little bit the margin side due to product mix. We have had a few price rises, nothing too major, but I mean, one of the advantages of the OTC market is you can put your price up whereas government contracts, obviously, and things like that, you are more constrained. That's one of the reasons we do like to have a proportionate business in OTC, 'cause it tends to be very sticky business, and you do have some flexibility as well. That was useful.
We did have to use up the last of our tax losses as well, which is kind of interesting because in the past, a few years ago, when we were making losses, we could never do anything like that because there was always questions about going concern, and now they kinda turned around the other way to us and said, "Well, things are going okay. You actually got to use them." Anyway, it's sort of a nice thing. Cash is obviously really important. You know, like, everything runs on cash. We're very used to that. We spent quite a lot of money last year. Like, we spent $2.9 million filing Maxigesic IV in the United States.
Despite some quite big spends, we were really pleased to see the cash balances actually grew, you know? Basically, as you can see, they grew from, you know, about NZD 3.2 million to sort of NZD 7.9 million. That was positive. We are, you know, in a positive cash environment where cash is building, and obviously the old saying, cash is king, is certainly true. I mean, the one thing I do wanna say is that at the moment, you've obviously seen internationally, you know, the government in the United States is having debate about whether it's a recession or not, 'cause they're trying to redefine the fact that two negative quarters, despite the last 10 recessions over the last so many years, were defined as a recession.
They're trying to say, "No, that's not." Yeah, we see lots of negative news. The thing that we've always found that's really important is pharmaceuticals still sell, you know? It's like food and like booze really, that people still have to have their healthcare even if times are good or bad. Obviously, if you're selling Ferraris, it's a bit of a different scenario, but healthcare is a really good area to be in, you know, if the economy tightens up, which I think most people would kind of see there is a bit of tightening. We've seen it in the U.S., and I guess it's arguably, probably happening here a little bit as well. You know, for us, though, we're kinda quite relaxed about that, and in fact, when we go to the U.S., we see that as a positive.
It presents more opportunities to do R&D partnerships than there would have been if everything had been booming. In terms of balance sheet, the equity has grown. The net debt came back, which was good, especially considering we were spending quite a lot of money on things like the U.S. filing and also we were and still are holding about six months buffer on our stock. The reason why, I think as David alluded to, and probably most of you read about, there still are challenges with logistics. You know, in the past, it was very simple sometimes to get a container or whatever. It is more challenging now, but our team's done a really good job with that.
There are some quite crazy things actually, as I was mentioning to one of the people before. The other day, we actually shipped something from New Zealand to Australia. It was cheaper to do it by air freight than what it was to send on a boat. I mean, absolutely ridiculous, you know. It is what it is, and we do all the research, and we do things in the most cost-effective manner. You know, that was just an example. I mean, overall, we believe the balance sheet is looking in good condition. You know, the net debt rather has come down, and despite additional stock holdings and background of that, you know, we still had an improvement.
Last slide really just the outlook and you know talk about pipeline and kinda opportunities and the like. As I mentioned, what's been important for us was having this broad portfolio because if tricky things happen, like a pandemic, that gives you more buffer and makes things safer because some things maybe that don't sell that well, other things sell better, et cetera. It is good to have a broad portfolio, and that's something we've always tried to do, and we're trying to do that going forward and checking that, you know, we still have a good balance of OTC, et cetera. You know, we look at that to make sure nothing's happening to the business and our projections that aren't within what we think is a good idea.
The Maxigesic line extensions, it's really getting those out and registered in additional markets, both locally and internationally, is really important. Also expanded R&D pipeline and getting that into the market. We have also learned a lot. We've got a good now international network of good companies that we work with. In fact, I noticed that when we went to visit them, one of the things they say is they kinda eyeball you and say, "Okay, we're happy with Maxigesic, but what else have you got?" You know? To not have something else, I think we'll be missing a big opportunity. There's no way we're putting our feet up and saying, "Oh, you know, we've done our Maxigesic studies. This is game done," et cetera, et cetera.
I think really we're just at the start of really being able to roll things out and make some, you know, big kind of opportunities. We do see that opportunity to grow things, and we are aggressively pursuing that. That's why we've increased our e-commerce platforms. I've talked a little bit about the Tmall side. It's not just that, though. We've got other things that we want to talk to you about during the year. Just keep an eye on the news flow. You know, we've got other things that we're working on in that area. You know, it's really important then too, with our R&D, like I've said time and time again, we want to leverage the fact that we're not a loss-making R&D company.
We're profitable, cash flow positive, so we can pick up other opportunities and take advantage of them because we are very efficient at doing R&D. A lot of companies go straight to a CRO, and they pay them a whole lot of money and don't have a lot to do with it. We have our own R&D department, and we effectively run all the studies ourselves. Our Pascomer study was a 16-site global study run during COVID, and we managed to complete it. Took a little bit longer 'cause of COVID, but, you know, good example how a little company like ours can actually do a big study, multiple jurisdictions from Europe to the U.S. to Taiwan, Australia, New Zealand. That's one of our strengths, that we do have this background and this capability, and it's something that we don't want to leave.
We wanna really leverage it 'cause this is our opportunity. Look, I've probably talked enough, and I will hand back to David. Thank you very much for your attention.
Thanks, Hartley. Before I open up the floor for questions, I just want to introduce you again to Ted Witek, who has traveled here from Canada. He just wanted to say it was his first trip here for AFT that he just wanted to talk a few words. Over to you, Ted. Do you wanna-
Thank you very much, David. I'm happy with
I see. Are you wiser?
No, no. This'll be two minutes. I think I'll project a voice as well. You know, last year, Anita Baldauf and I were new board members, and you got to see a video about us, and that's fine, and that's written down. I just wanted to make a few comments about the retirement of Doug Wilson. David Flacks mentioned I've been down here a few times, and although I didn't know AFT during my first career or visit, there was a very interesting connection, and it was Doug Wilson. Doug invited me down here to meet your prominent asthma and allergy doctor several times and to lecture in the country, and also to help with some of the barrier issues that we've had here.
One very interesting visit is Doug invited my entire family to spend the week between Christmas and New Year's here back in 2003. Despite having volcanoes and beaches and beautiful surfers on the beaches, my three daughters only talk about their evening discussions with Doug till this day. He's that special person. He's a gem of your country, but he's also a gem of the global pharmaceutical industry. Standing here, there was no other person in my professional life that was more important to me than Doug. He took me in as a young scientist. He challenged me with amazing projects, gave me guardrails, you know, sometimes let them out a little bit, but there were times I remember he called me into his office and squeezed me back in.
As I spoke to Doug yesterday, we had some great discussions about those times. I know Doug well enough to say I'd be foolish to say I can fill his shoes on this board because I don't think anyone can. I am very pleased, and I am very proud to take the baton from him and to let you know that Doug had such influence in the way I think scientifically and behave in this industry that I couldn't be more pleased to be sitting in his chair on the board of AFT. Thank you for allowing me to share those personal discussions about Doug being one of the most important individuals in my life. Thank you.
Thank you. Thank you, Ted. Okay, at this point, we are gonna open up the floor for questions. On the financial results and the business update and the other things that Hartley was talking about, directors and senior management team will also be happy to answer questions while refreshments are being served. Could I ask any person wanting to speak if they could raise their hand, and if you could wait for the microphone, please, because otherwise, those attending by audio won't be able to hear the question. If you could also state your name before asking your question, that would be great. Okay, thank you very much. Please. Good wait.
Yeah.
Welcome.
David, my name is Haylee Ching, and I've been an AFT shareholder for several years. Glad to see that the revenue rise and rise every year. I'm thinking of it can rise further, such as the Vitamin C little sachets. Now, Ukraine war is there. I wish the children suffering so much, they have something sweet to drink for vitamin C. Because I came from a pharmaceutical company. My parents were what should I say? Have pharmaceutical company when they were in their twenties, but that were destroyed by the communists that I don't want to spend time here. That made me sad. I just wish the children can have those drinks to lighten them up. I wish that the Jacinda government can give the money to AFT.
Yeah, because she's a Children's Commissioner. She always said, "Look after the children." Yeah. I wish that it can be another way to raise revenue. Another point is, because I'm an avid traveler, I have been to more than 50 countries, but as COVID lockdown, I haven't traveled for several years. I noticed, like, São Paulo, we have 12 million people in that city, and 30% of them are Japanese. I've been to the pharmacy there. I always like to visit things that I'm familiar with for my parents. Yeah. I think at that time, that is the year of 2008. At that time, the Brazilian money, I think, is higher than now.
They are similar products with some orders selling there and very busy. Yeah. That is a good point to expand in that market. Oh, by the way, for the Ukrainian vitamin C, because Ukrainians, they are not good at English, then how are they going to, what should I say? Have that product properly? Is there any Ukrainian version if you can send them with the government grant? Is there any-
Yeah. Well, look. Thank you. Look, thank you very much for your questions and comments. I'll take a couple of them. Firstly, with Brazil, we're not selling product into Brazil at the moment, but as I think Hartley mentioned, we are looking to try and develop a relationship with a Brazilian company who would be able to distribute our products. The Ukraine is a difficult one because, again, it's not easy right now to get product into the Ukraine. On the children's side, again, as Hartley said, it is difficult sometimes to develop children's products through the regulator.
Determines Lipo-Sachets.
Yeah. Well, Lipo-Sachets, again, that is available. I'm not sure whether we can get it into the Ukraine at the moment. Maybe, Hartley, you can comment on a couple of those things.
You know, I mean, just to touch on a couple of things. I mean, certainly in terms of Ukraine, we actually are obviously supportive, and we are working actually with a couple of companies in Ukraine, 'cause we see one of the best ways is to at least support and work with some Ukrainian companies. We actually have got a product from Ukraine approved. So we think as well, once things settle down, you know, obviously the best way, in many ways, to help is to work with them as well. We do certainly offer support, and we are working with our partners in Europe, where they are shipping some stuff into the Ukraine. So that's one of the other things. I think you touched on children.
I mean, look, clearly, as well, in terms of children's health, I mean, clearly that is an area that we feel quite strongly about. We are going the extra nine yards, you know, with the Maxigesic. Actually, I mean, we are working, say, and we are looking in the future, we're hoping to make an announcement around an actual children's medicine, because we do see. All our products, we actually look at them and say, "Are they things that are worthwhile, and will they help people?" Things we don't believe we won't sell. Like, we don't sell opioids. We don't sell codeine. We don't sell pseudoephedrine because it can be turned to methamphetamine and those sort of things.
You know, and we do have a specific big R&D thing we're working on at the moment that we would hope we can. There's a major children's problem. We would like to work on that. You know that kids' health is incredibly important, and we totally agree with that. Thank you.
Continue, because I have many other suggestions.
There may be other shareholders who would like to ask questions. Let's see how we go, and then thank you. Grant.
Yeah.
Thank you.
Hi. Lindley Naismith.
Oh, sorry.
Just wanted a comment or wondered if Hartley or David might like to comment on what they might see could be possible opportunities or roadblocks coming from our own government over the next year or so.
Okay. Well, Hartley, over to you.
That's a bit of a hospital pass question, Lindley. No, look, I think one of the important things is the thing we always work in in our business really is to put our own pathway out that we can follow, where we're not really reliant on the government or something like that. Really, you know, the pathway we've got, we are trying to be very much an outward-looking company, where the vast majority of our business comes actually from outside New Zealand. I mean, don't get me wrong, we love living here, et cetera. You know, on a business point of view, we see the world as a big place, and really, as a population of 5 million, we're always gonna be limited.
I guess, you know, government decisions can always have an impact, especially if you're very much a locally focused company, you know, maybe that makes GIB board or something like that, you know, or supermarket. I mean, that's why we've really focused outside, you know, to lessen that sort of risk. We spread our geographies, spread our products, you know, 'cause as we've seen, in Ukraine, for example, you know, we actually were supposed to be registered there, and we're supposed to be selling product there, hey, but we're not, you know, for obvious reasons. But obviously, there's much more serious things than.
Things like that. You know, but I mean, that's just our approach really is actually to minimize government risk, I suppose, by spreading our portfolio, our geographies. That's our approach really. Yeah. Thank you.
Grant Eagles, Shareholders Association. I was pleased, David, that you raised the matter of board succession and board planning. I'd also, first of all, like to say that it will be a great loss, of course, to lose Doug from the board. He's done sterling work and we know that. I'm sure that you'll be thinking about where you go to from here and hiring or looking to appoint a new director. Can I just also say that maybe you give some thought to the future and think about the IoD's Future Director program, which the Shareholders Association were involved in putting together 10 years ago, or even taking on the emerging director.
I mean, our thoughts are that certainly we put pressure on the top 50 NZX companies as part of their corporate social responsibility, because unfortunately, NZX directors are not getting any younger. The average age is 58, and the IoD tell us it's increasing. Now, maybe as a thought, you could think as well as an appointment of a director, looking at somebody like a young scientist who was looking to further their career and going into the area of governance. You know, we've found talking to the companies who have taken on young directors, and we're talking here by young, we're not talking that young. We're talking people in their thirties, mid-thirties to mid-forties.
That they've actually gained a lot from having the perspective of a younger person who is looking to further their career, as I say, particularly in the governance area.
Yeah.
If I can just make that.
No. Thank you.
Point to you that you do think about the benefit.
Thank you, Grant. Look, thank you. We have talked about the IoD Young Director program or Emerging Director program from time to time. It's never quite felt to be the right time to do that. We will continually look at director succession. We do talk about this, and we will definitely take that on board. Thank you for raising that. Yeah. Yeah.
Just a quick thought about, there's one or two other pharmaceutical companies listed in New Zealand, which are fairly specific in what they do. I just wondered if you ever think about the possibility of making a bigger New Zealand Australasian hub by acquisition?
Thank you. I'll pass that on to Hartley, but I will just say, look, we do obviously keep an eye on what other companies are doing. I mean, everyone's a little bit different and we've got our own focus, which is slightly different from some of the focus from some of the other companies. We always do keep an eye on things.
Yeah. No, look, thank you, David. I mean, we do and have discussed the kind of lens, you know, possibilities around acquisitions and things like that. Certainly, we do get quite a few things presented to us. I mean, our general view, though, is we think we can gain more by acquiring specifically R&D. It's the sort of projects really that we're looking at is doing a partnership agreement with a company. I mean, we would hope sometime this year, we have been talking to local universities, and we've certainly found one university that seems to have some very good IP, you know. We would like to work with them. That's kind of probably more that type of approach, looking to local universities.
I've always noticed in the United States, universities are a lot more engaged with industry than they are in New Zealand. It's really noticeable. I mean, places like some of these universities like Stanford and stuff, I mean, they might license out a patent, and they get, you know, 2%-2.5% or something, which might not sound a lot out of sales royalties. A pharmaceutical company sells a few billion. It's amazing the royalty stream that accrues to the university, you know. Our side are probably more looking at university kind of institutions for R&D, 'cause we personally believe there's more value. I mean, we personally believe that we'd rather have something that streams out the cash flow. I mean, yeah, 'cause if we did buy something too, we'd have to raise capital.
I mean, we personally don't feel our share price is overvalued at all. We really don't see the point in going to the market and raising capital at effectively a low price that, you know. We see we gain more by, hooking into some good R&D and really leveraging that. That, that's sort of been our strategy, rightly or wrongly. Thank you.
Yes. Have a go. Oh, this gentleman over here. Oh, a couple of other gentlemen. Yeah. There's a microphone over there.
Hello, can you hear me?
Yes.
I'm Tim Hamilton, Shareholder. Just a quick question about research and development. Whereabouts is your laboratory? Is it somewhere in the North Shore? How many people-
Takapuna.
What?
Takapuna.
All right. Start the recording from here. How many people have you got working there? Are you getting good people? You got a good number of scientists and good people who want to come and work for your company?
Yeah, good questions. A lot of our work is sort of not necessarily a scientific laboratory where one peers down microscopes. We have a few things. We have a device division, and they're probably the most scientific looking and boffin-like. They have a big.
Special fume cupboard and we're owner of a particle size measurement device. Apparently there's only two of them in the Southern Hemisphere. We do a little bit of laboratory work. In fact, Vlad's wife is an engineer, and she works in the device division as well. You know, we do have that side. Then on more the drug development side, most of that's conducted in clinics, really, literally around the world. That's actually quite important. If people come, I suppose, and expect to see lots of people in white coats bending over microscopes, I hate to say it's gonna be a bit disappointing 'cause you won't see that. You know, really it is people that run clinical studies, work closely with doctors.
As I was saying in that orphan drug study, we had five or six sites in the United States. We had another about five sites in Europe. There's people we work with very closely in Europe. There's a great lady dermatologist we work with in Barcelona, Marta, and she's like really up in her area. They have amazing hospitals there. Actually, they really are incredible. We do mainly work actually off-site is how our R&D works really. In terms of getting people, we find that we are able to find quite a lot of people, say, with pharmacy backgrounds and stuff that are maybe not that keen on working in the traditional pharmacy area, and they want to come and work in the pharmaceutical industry.
It does require quite a lot of work and training. Ioana sitting here is a very patient lady who trains up a lot of young staff, you know, and we have got and are really proud of the fact we're able to take these young people. We just recently employed a PhD pharmacy lady, and we're training Anusha up, you know. It is good to be able to take these people and kinda build them up. We are able to find them, but it takes a lot of legwork. Quite a lot of companies complain that, "Oh, you can't get staff. We need to do this, we need to do that." I suppose we do a lot of work, and it is a lot of work training up new people.
That's the approach that we've taken. Yeah. Hope that, touch wood, no. You know, there's obviously a challenge and always continues to be. Yeah. You know, no. We are able to get people. We generally have pretty low staff turnover, but obviously, we have some. You know, a lot of staff have been with us for good chunky periods, you know, 10 years sort of plus thing and stuff. Yeah. On-site really. We do a lot of kind of hands-on training, don't we? Really, you know, the thing I think we always say to people in guarantee staff at AFT is, "You won't get bored." There's lots of stuff happening.
We really prefer more of that kind of hands-on training where we're doing this project, "Okay, you don't know about it, but this is what you need to know." We kinda train them up on it, isn't it, Ioana? You know, they'll come, like Lily's one of our young ones, too, and she sort of traveled around America with you, and you taught her all about inspecting factories, say, and how to work out if it's rubbish or not rubbish, you know, sort of things, isn't it? Yeah. Yeah.
It's lovely to go with the younger generation and I could say from what I've done now, but.
Yeah.
more dedicated, I think, with AFT, I would say that it's gorgeous to have like even PhD students that we have working in different programs from the University of Auckland.
Yeah.
We have a very good relationship with different clinicians.
Yeah.
also we encourage their students or PhD students to work on certain programs, and then some of them might end up being recruited by us. I think it's gorgeous because in a way it keeps us all very young.
Yeah, yeah.
Enthusiastic as such.
Yeah.
Yeah.
Well, I mean, it was sort of, you know, kind of interesting the other day. We were at our kids' primary school reunion. I was talking to all the young guys there, and one of them was an engineer. I said, "Oh, you know, what's the age range like at your company?" This guy would've been 23 or something, 24 probably. He said, "Oh, the next youngest person was 40." You see, we don't have that. We have a really good range of kinda young people right the way through to experienced people, you know, i.e. older. You know, but it is actually good, and we do gain a lot out of hiring these young people, isn't it? It's fun. Yeah, we like it. Yeah. Yeah. Yeah, yeah. Yep.
Very good. What percentage of the company's products are produced in New Zealand, and what percentage is produced overseas, and what countries overseas are they produced in?
Good question. We do make some products here, like our Crystawash Xtend and our Hemptuary products are manufactured in New Zealand. The vast majority, though, are actually not made in New Zealand. I mean, also, too, with our markets generally being further away, it does unfortunately make logistical sense for them to be made elsewhere. We have a range of countries. We get quite a lot of product made in Europe actually, like Italy, Germany, Spain, Ireland, certain products made there. We get some products made in Malaysia, and we do get some made in India and China as well, where we work with very carefully vetted and actually very good manufacturing plants of a high standard. They work to U.S. FDA standards, et cetera. It is actually quite a broad geographical spread.
Generally as well, though, with something, say like Maxigesic, for example, we are trying to spread to get a number of factories, so we're not just working in one region 'cause we did find this a problem during the pandemic, where one country made a particular crazy rule and that did restrict manufacture.
Yeah.
We actually were fortunate that we also had manufacturing in another couple of countries. Some people don't like it. There are some elements too, where some jurisdictions prefer European-made product actually, including European-made over New Zealand-made product. They prefer it. But generally New Zealand-made though is pretty positive. We do try and make as much here, but it is difficult. You know, there's limited laboratories for testing and things, so there isn't a lot of infrastructure. That'll probably slowly change over time, but if you wanted to do a huge chunk of it here, yet you wouldn't be able to.
Thank you. Adam, would you? Yeah. Go ahead.
Hi. Is this on?
Yeah.
I'm Judi Hannah.
Welcome.
I must say that I was a pharmacist once. My question is, you're talking about you had a policy about modern slavery. Do you have a policy on pay equity?
We don't. Look, we don't have a policy as such on pay equity, but what we do have is a very broad range of employees, men and women, across ethnicities. We make sure that each employee is paid according to how good they are. Frankly, whether they are male, female or wherever they come from is completely irrelevant. We're a majority of women within our workforce. We also have, as you can see, women in our senior executive roles as well. We ensure that they're paid for the work that they do rather than for who they are.
We audit that every year across similar roles. We look at everybody's pay. We look at everybody's pay scales and ensure that the same people at the same skill level are earning the same money. It's quite a process, but we undertake that every year.
Marree, as Chief of Staff, feels rightfully strongly about it, and you monitor it.
Very strongly.
are closely involved in it.
It does fall under our ethics policy in a way, and we are bound by the board to check on equity every year.
I ask the question, Marree had pay equality.
Mm-hmm.
I resent the fact that people are still struggling with it after all these, gosh, it's 60 years or more since I started.
Yeah.
Well, we agree with that.
Yeah. Now would you like to ask one more question?
It's not asking a question. It's just now Dr. Hartley Atkinson mentioned about having liaison with University of Auckland about research, et cetera. Because I'm a shareholder of Aroa Biosurgery Limited, which is an Auckland University academic company, but it was floated in Australia, but had not floated here. Then Australia, there are 1,300 companies there. This company actually did those, what should I say? Pitch scheme and then make it into a scaffolding and then for a surgery purpose and then match into the scheme much quicker. They are doing very well in America. Their revenue is now starting picking up double-digit, and they are building another factory in Mangere near the airport.
Next week, Wednesday, 1:00, there will be an annual shareholder meeting there. Because I live in Takapuna, won't be able to go travel so far. I don't drive at all. I don't know whether your company business development officer will be interested to go there so that have a chance of getting more business across the hospitals in various countries then. Yeah. Finally, mentioning about the Asian countries and I have been to Malaysia, only to Penang, not yet to Kuala Lumpur. Penang is a similar population as Auckland. Because is Malaysia is a Muslim country, then they have several hours that don't do business because they have to. The Muslim have to go to pray. Nothing to do during those spare hours. I went into the pharmacy.
I just like because my parents and three generations are doctors, surgeons. I'm very interested in this sort of thing. Then there's this company called Mannings. They're also very famous in Hong Kong, where I came from. Even though it's just 1.2 million people, business is very good. I bought things there as well. They are comparable prices to Hong Kong. Sometimes when you have nothing to do, just go shopping. Yeah. I think Malaysia can be another market to explore, to earn more revenue and do good for the society as well.
Thank you.
And-
Thank you.
Maybe Singapore as well, because they are open now.
We are.
Yeah.
Thank you very much.
Not at all. Yeah.
Hartley did mention.
Wish you good luck.
Thank you. Hartley did say, of course, that we have a, you know, a strong Asian presence, and, we certainly are-
Yeah.
We're looking toward that.
No, we are. We are selling in Malaysia, actually, so thank you for that. But no, we are. Actually, Marree myself did a launch tour for Maxigesic in Malaysia where we spoke and helped them in literally Penang, Ipoh, and Kuala Lumpur. Nice thing actually about New Zealand is that we were able to conduct our launch at the Ambassador's house. You know, I think if you're in the United States, you probably have to be Microsoft to do it. But in New Zealand, it's actually really great with NZTE. They're very supportive, and we're able to hold our launch meeting at the Ambassador's house, which a lot of the doctors thought was pretty good because they might have been to all the flash hotels in town, but no one had been to the Ambassador's house.
Yeah, just things like that were really nice. Anyway, yeah, thank you. I've certainly in terms of Aroa Biosurgery, I actually had dinner with Brian Ward the other day, so yeah, we are well aware of them. Thank you.
Thank you. Thank you very much. Any other questions or comments on the presentation? Okay. Well, thank you. As there are no further questions, I'm now gonna come to the formal matters requiring resolution, which are outlined in the notice of meeting. There'll be an opportunity to ask questions on each of those resolutions that are being put to shareholders. As is now required by the NZX listing rules, a poll will be conducted for each of these resolutions, and they'll be conducted all together at the end of the formal business. Your board supports each of the resolutions being put to the meeting, and as stated in the notice of meeting, each director intends to vote all their shares and their undirected proxies in favor of the resolutions.
Proxies have been appointed for the purposes of this meeting in respect of approximately 84 million shares, representing about 80% of the total number of shares on issue. We'll show the proxies cast for each resolution before we vote. Resolution one relates to the remuneration of AFT's auditors. The proposed resolution is to authorize the directors to fix the auditors' remuneration for the current year. In accordance with the Companies Act, Deloitte has been automatically reappointed as the company's auditor. Details of the statutory audit fees paid to Deloitte for the financial year ended 31 March 2022 are set out in the annual report. 2022 audit fees are expected to be comparable with last year's, with provision for an increase as the audit scope broadens with the company's expansion.
I now propose, as an ordinary resolution, that the directors are authorized to fix the fees and expenses of Deloitte as auditor for the 2023 financial year. Are there any questions concerning the motion? Thank you. The poll on this resolution will be conducted at the end of the formal business. We'll now move to the next resolution, which is that Dr. Hartley Atkinson be reelected as a director of AFT Pharmaceuticals. Hartley is retiring by rotation in accordance with the listing rules and offers himself for reelection. I'm pleased about that. The board recommends Hartley as a director and unanimously supports his reelection. His bio is set out in the notice of meeting. I will now invite Hartley to briefly address the meeting on his proposed reelection.
I probably feel as I've said much too much today, but, no, look, it's very much, I'd definitely very keen to stay on 'cause I still feel very much it's a job. I don't even wanna say half done. I reckon it's a third done, you know. There's a heck of a lot of opportunity and things to do. We don't wanna sit around and be passive and sort of be, you know, content with what we've got in terms of business. I think there's so much potential, and really, I think it's really important, that I can sit on the board and just make sure that we keep pushing that, you know, that sort of whole vision of where we can really end up, and that's what I really want to do. Thank you.
Thanks, Hartley. I now propose that Hartley Atkinson be reelected as a director of AFT. Are there any matters for discussion or questions concerning the motion? The poll on the reelection of Hartley will be conducted at the end of the formal business. We will now move to the next resolution. That Jon Lamb be reelected as a director. Jon is retiring by rotation in accordance with the listing rules and offers himself for reelection. As I mentioned at the beginning of the meeting, Jon has been unwell, but he is making good progress, and both he and the board are confident that Jon will continue to be a strong contributor to AFT. Now, Jon has prepared a statement, which I will read out for him, and his bio is set out in the notice of meeting.
The board recommends John as a director and unanimously supports his reelection. This is John's statement. "I apologize for not being able to join you at today's annual meeting, but look forward to seeing you all again soon. Although I've been unwell, I'm pleased to report that I'm making good progress, and I look forward to continuing to work with you and add value to Hartley, the board, and the AFT team. My background is in multinational pharmaceutical and FMCG businesses, developing and marketing products. I've worked in several countries around the world. In 2004, I was asked to review AFT by a government agency because AFT had applied for a grant to help clinical trials on the product that was to become Maxigesic. Having done an assessment of the company, I recommended that the grant be awarded.
AFT is one of the few New Zealand companies that has achieved double-digit growth year-over-year across the past decade. It now has a robust business in Australasia and is building in Asia and the rest of the world. There's considerable growth still in Australia. My aspirations for AFT going forward is to take its patented products to global markets and build the first New Zealand-based, homegrown, multinational pharmaceutical company. This journey has commenced. Maxigesic is now licensed in more than 100 countries. The Maxigesic range extensions are underway. The Crystaderm range is underway. We've launched the NasoSURF product. This is considered by many analysts as a substantial business. We are building on the company's allergy and eye care business.
I'm a member of the Institute of Directors in New Zealand and have undertaken various courses, including governance and financial essentials, leading in the digital area, audit and risk, and the five-day company directors course. I'm also a member of the Australian Institute of Company Directors and have completed its five-day course to upskill on the governance and regulatory issues in Australia. I look forward to continuing to represent you, the shareholders, on the board of AFT and request your vote on my reelection. Thank you. I now propose that Jon Lamb be reelected as a director of AFT. Are there any matters for discussion or questions concerning the motion relating to Jon? Thank you. You will now see on the screen the proxies that have been cast for each resolution.
Now, ladies and gentlemen, we'll conduct the polls on the matters described in the notice of meeting. Please use the voting card that you received when you registered on arrival. Please complete your voting paper by ticking for, against, or abstain in the appropriate place on the form for each resolution. If you have any difficulty, please raise your hand and someone will assist you. Please remain seated until your voting card has been collected. As you can see, our share registrar, Computershare, will come around with ballot boxes and collect the voting cards. Are there any items of general business to be discussed? On behalf of the board, I thank you all for your attendance at AFT's 2022 annual meeting. We will be announcing the results of the polls to the stock exchanges this afternoon.
I now invite you to meet directors and senior management and the auditors and have some refreshments. If you could stay seated until your voting papers have been collected, that would be great. I now declare the meeting closed. Thank you very much, everyone.