Good afternoon, ladies and gentlemen. My name is Stuart McLachlan, and I'm the Chair of Scott Technology Limited's board. I would like to welcome you all to the 28th Annual Meeting of Scott Technology Limited. I'd like to acknowledge John Marsh, the Marsh family, our second largest shareholders, and many of you know that the late Graham Marsh chaired this company and was director for many, many years. I would also like to acknowledge Graham Batts, who also served 60 years in various capacities, and if Graham remembers, I wouldn't let him retire until he had served the 60 years. Today's meeting has been conducted both in person and online. We're very pleased to welcome those of you participating online through the virtual meeting platform provided by our share registrar, MUFG Corporate Markets, formerly Link Market.
I'll provide you with further instructions as we progress through the meeting, but if you encounter any issues, please refer to the virtual meeting online portal guide, or you can phone the helpline on 0800 200 220. So that's for external people because I'm going to ask everyone here to have their cell phones off. For those of you here in attendance, firstly, can I ask you to turn off the phone, and then, in the event of an emergency, please follow directions from staff. Exits are clearly marked, and the assembly point is in the car park at the front of the building. Before we formally begin, I would like to introduce you to my fellow board members. So John Foreman to my left, Brent Eastwood, and John Berry and Al Byers, and Derek Charge are online.
And just with our company policy, we don't have people flying around in jets, so it's better for our carbon footprint. And of course, they're busy execs in their own rights. And then our Emerging Director, Penny Ford. Finally, I'd like to welcome Andrew Dick and Scott Hawkins from Deloitte, our company's auditor, and to the team from our share registrar, MUFG. They will also help conduct the voting on the business, the formal business, later in the meeting and also act as scrutineer. As with the normal annual meeting, anyone in the room or online will be able to ask questions and vote. I encourage you to do so. For those of you online, can you send through your questions at any time through the online portal by clicking the Ask a Question button?
And I'd encourage you to do so as early as possible, as this will allow us to answer these questions at the appropriate time of the meeting. The notice of meeting has been sent to shareholders and other persons entitled to receive it. I've been advised that there is a quorum present, and so I can declare the meeting open. Proxies have been appointed for the purposes of this meeting in respect of approximately 53.8 million shares, representing over 66% of the total number of shares. I'd like to thank the shareholders for the level of participation in today's meeting. Alex Ball is attending online, representing the New Zealand Shareholders Association. My fellow directors and I intend to vote all discretionary proxies we have received in favour of the resolutions as set out in the notice of meeting.
The agenda for this afternoon's meeting will be as follows: Chairman's Address, Strategy and Performance, Core Business Highlights, Sustainability, People and Planet, General Business Questions, and the formal business of the meeting, which includes the resolutions of the meeting. I wish to note apologies have been received from Jack Allen and Lynley McLachlan. We have approximately 100 shareholders online today. Today, you'll hear from myself, our CEO, Mike Christman, our President of Europe and North America, Aaron Vanwalleghem, who was the Interim CEO during the leadership transition period, Casey Jenkins, our Group GM of ESG, People, Marketing, and President of Minerals, and our Co-CFOs, Anthony Wesney and Mark O'Malley. On behalf of the Board of Directors, I'm pleased to welcome you to Scott Technology's 2024 Annual Shareholders Meeting and present the results and highlights of Scott's financial year.
Today, we celebrate the achievements of the past year and share our vision for continued growth and value creation in the years ahead. The resilience and success we've demonstrated in 2024 reflects the dedication and excellence of our employees worldwide, as well as the strength of our world-class products and innovative technology. As we reflect on our achievements, it's also important to acknowledge the broader business landscape in which we operate. The global environment remains complex, and several persistent trends are shaping the way we navigate our markets. Though interest rates are starting to ease, they remain elevated compared to pre-pandemic levels. Inflation has moderated but still hovers above targets in many regions. Economic growth varies significantly across regions, adding to market unpredictability. Ongoing geopolitical tensions continue to drive companies towards nearshoring to strengthen supply chain resilience.
Yet amid these challenges, we see strong opportunities, and Scott is well positioned to adapt and thrive. Our global footprint empowers us to support customers as they adjust their operations to meet economic and geopolitical shifts, offering solutions that enhance resilience and responsiveness in an ever-evolving market. As businesses increasingly bring production closer to their core markets, Scott's product-led solutions remain critical assets in creating efficient, localized operations. Our strategic presence across North America, Europe, Australasia, and China allows us to partner closely with companies focused on strengthening their regional supply chains, helping to enhance their productivity, security, and long-term stability. As we continue to navigate the complexities of the global business environment, Scott's focus on innovation and operational excellence has positioned us well to capture growth opportunities.
Despite inflationary pressures and rising costs, Scott achieved strong results in FY2024, with revenues of NZD 276 million, a 3% increase year on year, and a stable EBITDA of NZD 30.2 million. This growth reflects the demand for our solutions and the effectiveness of our strategic initiatives. Our success is driven by a commitment to building authentic customer partnerships, leveraging cutting-edge technology, and upholding operational excellence. Looking ahead, we're excited to extend the Scott 2025 strategy through to 2027, providing a foundation for sustainable, long-term growth in the dynamic field of smart, product-led automation. Our forward work pipeline remains solid, with NZD 160 million in orders and service agreements across core sectors, including materials handling, minerals, and protein.
This growth trajectory is supported by innovative, scalable solutions such as the BladeStop T300, poultry trussing system, Automated Modular S olution for minerals, a new modular automated guided vehicle, new palletizing solutions, and advanced processing solutions for both beef and lamb, which are progressing through key development stages. This diversified product portfolio has provided us stability and growth across key markets, supported by our focus on cultivating authentic customer partnerships, adopting leading-edge technologies, and maintaining high standards of operational performance. Additionally, our investments in people and infrastructure remain core to our strategy. This year saw the successful launch of the new Rocklabs facility, investment in our Czech Republic site, and an expansion of our North American presence. These developments reinforce our commitment to supporting customers and positioning Scott for future growth, as well as responsible and sustainable operations.
This year marks an important milestone for Scott Technology as we release our first sustainability report, a significant step three years into our environmental, social, and governance, we call it ESG journey. This report reflects our evolution as a company, our commitment to climate-related disclosures, and progress on key ESG initiatives, including setting our ambitious carbon reduction target of 30% by 2030. We recognize our role in advancing a low-carbon, climate-resilient future and our responsibility to be a positive force in business. With industry-leading customers across multiple sectors, we understand the impact we can have in supporting their decarbonization journeys and the ripple effect this creates across industries.
The sustainability report provides an in-depth look at our team's work in mapping Scope 1 and 2 emissions, a complex yet essential endeavor across our global operations, and details our progress with the double materiality assessment, a comprehensive study to ensure our sustainability priorities align with those of our stakeholders. By carefully aligning our ESG initiatives with our core purpose and the needs of our stakeholders, we have built a robust ESG framework centered on our foundational pillars of people, purpose, and place, as outlined in this report. Among our significant achievements, the sustainability report highlights a major milestone: reaching a lost-time injury frequency rate, better known as LTIFR, of zero in FY24. So congratulations to our team. It's a very, very good thing. This accomplishment exemplifies our commitment to safety and reflects the high-performance culture that is embedded at Scott.
In line with our commitment to delivering consistent returns to shareholders while supporting reinvestment for long-term growth, we've declared a final dividend of NZD 0.03 per share, bringing the full year total to NZD 0.08 for FY24. Looking ahead, we're confident in Scott's ability to maintain its growth trajectory, bolstered by the recent appointment of Mike Christman as our CEO on the 29th of October. Mike, you'll hear from him shortly. With his extensive experience and fresh perspectives, Mike is exceptionally well positioned to lead Scott toward continued success in the years to come. Our robust order book and the strong ongoing interest from our global customer base highlight the sustained demand for our market-leading products and solutions. Moreover, the substantial investments we've made into the business, along with the strategic initiatives outlined in Scott 2027, provide a solid foundation for sustained growth in FY2025 and beyond.
These efforts reflect our dedication to both strengthening our core capabilities and exploring new avenues for value creation. On behalf of the board, I'd like to thank our shareholders for your continued support of our company, the board, and management. I'd like to thank my fellow directors, Al Byers, Brent Eastwood, John Berry, Derek Charge, and John Foreman, who are always available to provide assistance and wise counsel when needed. Penny Ford, our emerging director, has brought her extensive experience and skills to the board, which has been well received. Finally, I would like to thank and acknowledge our outgoing CEO, John Kippenberger, for his significant contribution and leadership of the business through to FY24. I'd now like to note and adopt the annual report, including the chairman's report, financial statements, and auditor's report of Scott Technology Limited for the year 31st of August 2024.
Thank you, and I'll now pass over to our new CEO, Mike Christman. Please give him a warm welcome.
Thank you. Thank you very much, Stuart. Good afternoon, everybody. As Stuart introduced, my name is Mike Christman, and it really is my absolute pleasure to be with you here today, and I really am incredibly proud and honored to be standing here as the new CEO of Scott Technology alongside other members of the management team. As you're probably aware, I joined Scott just a few short weeks ago, relocating from the United Kingdom, so quite a journey over here. It's been truly amazing to look back at some of Scott Technology's very rich history, and I have to say, I'm extremely impressed by the company's innovation, mindset, and drive to win.
Something that I've seen and felt firsthand myself as I've been around the various sites here in New Zealand only at the moment. It's been amazing, really, to witness and see that. I now have the privilege to become part of Scott's history by leading the organization in its future. A future of continued innovation, a future of deepened customer intimacy and value, a future of well-being for our people and our planet, a future of growth, and a future of being the employer of choice. But just a little background on myself, if I may. I bring experience in automation systems and the full life cycle and a deep understanding of customer-first thinking.
I had the pleasure to lead teams of around 2,000 employees with revenues of around NZD 800 million for a company called Vanderlande Industries, a subsidiary of the Toyota Industries Corporation in Japan. I was accountable for driving the market strategy, the technology roadmaps, and the people development side of things. Whilst you're used to these events being led by the chairman and the CEO, given that I've only been here just for four weeks, today you'll primarily hear from other members of my executive management team. Aaron, as introduced by Stuart earlier on, the President of EU and US, will update you on our current strategy, business performance, our safety position, and innovation developments. We'll then move over to Mark O'Malley, Co-CFO, who will talk you through the financial overview and the key updates of the organization.
We'll then dive into specific business group updates. So again, Aaron will come back and cover material handling. Casey Jenkins will cover the people side of things, global, environmental, social, and governance, with an update from our minerals division. And then Anthony Wesney, Co-CFO, will also provide insights on the protein side of the organization and the strong growth in our service sector. Following these updates, and as Stuart mentioned earlier on, I'm really proud to share that Casey will present a top-level overview of our environmental, social, and governance report, including the milestone of that report being published for the first time today, I believe, Casey. I will then come back to you just to summarize before passing back to Stuart to close the proceedings. But I think it's also really good for me to just pause for a second and recognize something.
In the short weeks that I've been here, I've really been genuinely impressed by what I've seen. The technology and the customer-first mindset. It really is remarkable. The commitment to safety is something that I've never experienced in any organization that I've worked for before. It truly lives in everybody's heart, but it's the passion and the dedication of the teams that really, truly stand out to me. They're not just developing cutting-edge solutions, but they really are forging the market for the future. Over the next short period, my focus will be on the evolution of our long-term strategy, along with the alignment and the direction of our incredible global teams, and together, we will drive growth. We will maintain our leadership in automation. We will deliver market-changing innovations to our customers and bring value.
But before I pass over to Aaron, I really would like to express my sincere gratitude for his exceptional leadership and stewardship as the interim CEO. And I think that needs to be recognized. His efforts have ensured stability, continuity during what is a really important time for us. And for that, I am deeply grateful. So I'd like to pass over to Aaron for Aaron's update.
Thank you. Thank you for that, Mike. Good day, everyone. So my name is Aaron Vanwalleghem, and I'm Scott's President of Europe and North America. As Stuart and Mike already mentioned, I had the privilege to serve as Scott's interim CEO from when John Kippenberger stepped down in August until Mike took the reins on the 29th of October.
After a strong fiscal year 2023, we are pleased to report continued steady growth in the fiscal year 2024, with revenue reaching NZD 276 million , up 3% despite the challenging macroeconomic environment. While growth was more measured this year, our focus on long-term strategy and disciplined execution has ensured we stayed on course. Our EBITDA remained stable at NZD 30.2 million , with margins at 27%. This resilience reflects strong performances in our material handling and minerals business. Our strategic focus on core sectors, material handling, minerals, and protein has paid off, with sales and services in these areas now accounting for 85% of our total revenue. This represents a 6% year-over-year increase, demonstrating the strength of our market positioning. Looking ahead, we are well positioned for sustained growth with a strong sales pipeline of NZD 160 million in forward work.
This includes significant MHL projects, strong orders in minerals and protein, and continued momentum in secured service contracts. We are also extending the award-winning Scott strategy through to 2027, making key investments in our global operations to ensure sustainable progress in the years ahead. By strategically investing in our capabilities and aligning with our long-term vision, we are confident in our ability to navigate the challenges ahead and capitalize on new opportunities for growth. As our Chairman, Stuart, highlighted earlier, we are extremely proud to sign off on extending our strategy into 2027. These are the key focus areas driving our business forward, our pillars of strength that define where we are headed. First, let's talk about our leading-edge technology pillar. Here, we're focusing on three main areas. First, productization.
We're channeling our efforts into high-demand solutions like BladeStop, Poultry Trussing, AMS in minerals, and the NexBot in material handling, solutions that meet market needs and push us forward. Sustainability leadership, innovation and energy efficiency, and environmental responsibility is at the core of what we are developing. We are prioritizing technology that has a positive impact on the environment. Leveraging data, we are increasingly exploring ways to harness and integrate data to grow efficiency and broaden our product offerings. By leveraging advanced tools such as our Maestro + software to optimize material handling operations and employing machine learning and X-ray technology to improve yields in meat processing, we ensure we remain on the forefront of innovation in our industry. Next, there's the one Scott pillar, which is vital to our future.
This is all about our people, upscaling, retaining, and engaging our workforce to build a strong, united team that drives our mission forward. Operational excellence is another focus area. Here, we're refining our processes to ensure each project is delivered on time, within budget, and up to the highest standards. This is about creating a reputation for reliability and quality in everything we do. When it comes to authentic customer partnerships, we're committed to collaborating with leading companies around the world. These partnerships aren't just about one-off transactions. They're about fostering long-term, repeat business that fuels mutual growth. And finally, robust global platforms. We're investing in the infrastructure that will support and sustain our growth, building the foundation for our future as a global leader. At Scott, safety isn't just a policy. It's a part of our culture.
You'll notice on the chart, our proactive efforts to increase lead indicators on the bottom, such as safety conversations, near-miss reporting, and hazard identification, have led to a reduction in lag indicators on the top, such as lost-time injuries. By focusing on proactive safety measurements, we're seeing tangible improvements in overall safety outcomes. We're proud to report a 100% reduction in lost-time injuries this year, a clear outcome of our commitment and strategy to develop a safe and healthy workplace. Our Safe Mate program and Be Safe, Be Well, Be Scott framework are central to this achievement, fostering a safety-first mindset across all our teams. This work is supported by our Be Scott reporting app, which is fully integrated globally. Engagement has been strong, and with more employees actively participating in safety discussions and initiatives.
We also held our third global Stop for Safety moment and have continued to reduce hazards while increasing near-miss reporting. With ISO 45001 certification now achieved across six key sites, we're further strengthening our foundation to a safer future. At Scott, innovation is at the heart of what we do, and we're thrilled to see our developments resonating with customers around the world. Here are a few of the exciting projects currently shaping our future. First of all, beef processing. Building on the success of our lamb processing system, we're taking our expertise to the beef industry. This new venture is about more than just automation. It's about creating precision engineered solutions that open doors in global markets. Next to that, we have the Energize project. Just last September, Caterpillar introduced their automated energy transfer system in Arizona.
This game-changing technology, which we're proud to be part of, is set to automate charging for large electric mining vehicles, making a huge step towards greener, more sustainable operations in the mining industry. The Poultry Trusser, our latest trusser system with the third line deployed by Costco, is setting new standards with world-first technology. This isn't just another installation. It strengthens Scott's position as the go-to partner for industry leaders around the world. The BladeStop T300 expansion, with the first installation of our T300 in North America. We're reaching new markets, including grocery stores and independent butchers. This is a strategic move that broadens our impact and increases our total addressable markets. And last, the modular AGVs, our new modular automated guided vehicles called NexBots, are built on a flexible, repeatable platform that enables customized solutions with up to 80% lower engineering cost.
This product-led approach allows us to efficiently tailor solutions to diverse customer needs, giving us a competitive advantage. Set to launch at the end of Scott's H1 2025, so at the end of February, beginning of March, we have already secured pre-orders from a major North American food processing company expanding into France. I will now pass over to our co-CFO, Mark O'Malley, who will take you through the financial performance.
Thanks, Aaron. Scott has demonstrated financial resilience and discipline as we navigated a complex global environment with inflationary pressures, rising interest rates, and political uncertainty. Despite these headwinds, I'm pleased to report that we achieved 3% revenue growth, a solid result, particularly following last year's strong performance. This growth shows that we've been able to balance stability with strategic investments that strengthen our core business and position us for future opportunities, even in uncertain times.
We reported NPAT of NZD 7.7 million, down on prior year. This was partly driven by the one-off costs associated with the strategic review and restructuring cost aimed at refining our core business focus. Additionally, we incurred higher depreciation and amortization expenses due to our investments in expanding operational facilities and acquiring new fabrication equipment, both to position the business for sustainable growth. To give you a sense of scale and purpose of these investments, we've expanded our facility in Czech Republic with an additional 3,000 sq m of assembly space to support the increased output of MHL and BladeStop products. The space will enable us to handle rising volumes with efficiency. In Auckland, we've established a new Rocklabs facility to bolster the growth of our core Rocklabs product range, covering crushing, pulverizing, and dispensing equipment, and to accommodate future growth in our automated modular solutions portfolio.
These major facility investments go beyond our typical R&D expenditure, reinforcing our commitment to long-term growth. Finally, our financing costs increase, a mix of higher effective interest rate and increased net debt levels, alongside an additional NZD 0.8 million of deferred tax expense related to the change in legislation around building depreciation during the period. On net debt, we had a closing total net debt position of NZD 20.1 million. The increase was driven due to cycling some significant cash deposits for key projects in prior years, the strategic focus on investing in our operations, pre-build on equipment and advance of orders, which we have subsequently secured in FY25, and higher interest tax and dividends paid out during the period. On a positive note, operating cash in the second half was strong at NZD 13.7 million, offsetting negative cash in the first half.
We're starting to see operating cash normalize following some anomalies in prior periods, and we expect to see this continue into FY25. Scott's strategy of generating more revenue from proven systems, products, and services has delivered another strong period of growth. Scott's core sector has now achieved 19% compound annual growth against FY2022 and accounts for 85% of our group revenue, up from 79%. Key partnerships with global customers have driven a 35% increase in MHL, particularly in the U.S., and continued expansion in the European market. The launch of the Rocklabs AMS line boosted minerals revenue by 19%. Despite recent challenges, the protein division is poised to leverage new opportunities in FY25, including a significant lamb primal order from JBS in Australia. Additionally, Scott's emphasis on service and aftermarket support continues to build a sustainable and recurring revenue stream, enhancing value for our expanding installed base.
Now, the team will take you through our core business highlights, which covers materials handling, minerals, protein, and service and aftermarket. I'll now pass you back to Aaron, who will take you through the key highlights of MHL.
Thank you, Mark. Moving on to our materials handling business, we've seen strong growth driven by high demand for automated palletizing solutions. We achieved an impressive 35% revenue growth as Scott Material Handling's presence continues to expand across Europe and North America, with over 40 projects currently in progress. This includes significant milestones like the completion of the ASRS system for Alliance here in New Zealand, progress on major projects for JBS Brooks and McCain in Canada, and a solid execution in Europe, where we completed Incom Leone multi-line palletizing system for ice cream in Slovenia.
Our forward order book remains robust at NZD 95 million, and in Q4 of fiscal year 24, we secured important deals with clients like Agristo, Danone, Cranswick, and a major global potato processing company in North America. In terms of profitability, our material handling margins have grown by 31%, which is a strong result. While our margin percentage was influenced by the strategic project at JBS Brooks in Canada, excluding this, we saw solid margin growth, a reflection of our strategic focus on growing profitability in material handling and logistics. I'll now pass you over to Casey Jenkins, who will take you through the key highlights for the minerals business.
Thanks, Aaron. Our minerals business has achieved strong growth of 19% in FY24.
This growth has been driven by the positive delivery of Rocklabs' first automated modular solution, or AMS, and Caterpillar's automated energy transfer system, known as Energize. Despite macroeconomic challenges and price pressures in the global commodities market, we've been able to grow our minerals sector by introducing new products, engaging blue-chip customers, and strengthening our distributor network. It's been a solid year for Rocklabs' standard equipment business. This is our core range of our crushers, pulverizers, and splitters. We have, however, seen softer demand for our spare parts business due to reduced exploration and lower sample throughput in commercial labs. This year, we've strategically invested in our new world-class Rocklabs facility in Auckland. This not only allows us to grow our core product range, but it also enables a stronger focus on product innovation and positions us for future growth, especially with AMS.
In terms of margins, we've seen a 5% growth overall. However, there's been a slight dip in margin percentage, mainly due to a shift in our product mix towards new solutions, as well as added development costs for our AMS line and a softer demand for parts. I'll pass over to Anthony now to take us through protein.
Thanks, Casey. So let's start with our protein sector. Revenue in our protein sector has seen a 21% decline to NZD 60 million for FY2024. This was largely due to tough conditions in the North American beef market and challenges in the lamb markets across Australia and New Zealand. These market dynamics impacted our lamb equipment and BladeStop's saw volumes, especially in the second half of the year. However, our service teams achieved 20% growth, focusing on delivering strong customer value and servicing our expanding installed base.
A big contributor was New Zealand, where a number of service-level agreements were signed with major plant clients. This not only boosted revenue this year, but it also positions us well for continued aftermarket success. The drop in equipment sales volumes and shifts in product mix did put some pressure on margins, but looking forward, we're seeing positive signs, particularly in Australia, where rising confidence in the lamb market is sparking capital investment. A prime example of this is our recent lamb palletiser order with JBS. In North America and Europe, there's growing interest in our poultry trussers and BladeStop products across meat processing, retail, and industrial segments. With Mark Host, our new Vice President of Protein Sales, joining in June, we're building a strong sales pipeline for both existing products and the new BladeStop T300, where we're targeting supermarkets, butcheries, and grocery stores.
Now, our service and aftermarket business wasn't just strong in our protein area, but was a significant contributor to Scott's financial performance during the year. The segment is now contributing 28% of our total revenue and is truly transformative for Scott. It's not just a reliable, recurring revenue stream. It's cornerstone of our long-term growth. With our installed base expanding, more customers are relying on our expert technicians and consumables to keep their operations running smoothly. This translates into more customer touchpoints, stronger relationships, and new opportunities for innovation. Our service and aftermarket business is set to be a powerhouse for Scott's future. And speaking of the future, I'd like to hand back to Casey to update us on our ESG initiatives.
Thanks, Anthony. As John mentioned, today is a significant milestone for Scott.
Three years into our ESG journey, we're proud to present our first-ever sustainability report alongside our climate-related disclosures. Our commitment to sustainability is about taking responsibility for our social and environmental impacts while ensuring sustainable, profitable growth for all stakeholders. Since launching our ESG strategy in FY 2021, we've made consistent progress driven by strong engagement throughout the entire business and ongoing support from the board. I'm proud to share some of the progress that we've made with you today. Over the past 12 months, we've been diligently working on our carbon management plan, collating and analyzing data to measure both our FY 2023 and 2024 carbon emissions. Through this work, today we can announce our carbon reduction target that we're calling 30 by 30. This ambitious target will see us work towards a 30% reduction in our Scope 1 and Scope 2 emissions by 2030.
Our focus on Scope 1 and Scope 2 emissions reflects our commitment to taking immediate and actionable steps, as these are the areas where we have transparency and control. We also recognize the importance of tackling Scope 3 emissions, and we're working hard to close the gaps to achieve a truly comprehensive carbon management strategy. By holding ourselves accountable to our 30 by 30 goal, we're not only future-proofing our business, but also driving meaningful change that will benefit generations to come. It is another step towards building a more sustainable, responsible, and climate-resilient future. After three years of executing our ESG strategy, we recognize the importance of working closely with our broader ecosystem. Recently, we conducted an external materiality assessment to ensure our sustainability efforts are aligned with stakeholder priorities.
As part of this assessment, Scott gathered valuable insights through surveys and interviews with a range of key external stakeholders, which included shareholders, customers, suppliers, employees, and directors. This has sharpened our focus on areas like climate change and product innovation to ensure our ESG strategy continues to evolve with our business. From here, we've evolved our ESG framework centered around our foundational pillars of people, purpose, and place. This framework now encompasses team focus areas, which range from safety and well-being, diversity and inclusion, right through to government and climate change, and of course, product innovation. Together, these focus areas guide us as a responsible business, ensuring we operate with integrity, responsibility, and transparency in our commitment to making a positive impact. Lastly, I want to highlight some of the achievements of our people. Because it's Scott, they truly are the heart of our business.
This year, we're proud to achieve an impressive employee engagement score of 85%, up from an already strong 83% last year, and more importantly, a really pleasing participation rate of 80%, and we continue to invest in our people. An example of this is our focus on leadership development. This year, 37 employees in New Zealand completed a comprehensive 16-week leadership development program. Our team in China ran a similar program, and we're now preparing to roll this training out to our other regions. We're also committed to building diverse and talented teams. We understand that diverse minds create diverse solutions, and this is critical to continuing to deliver world-leading technology. This year, we awarded our second Scott Technology Women in Engineering scholarship in partnership with the University of Canterbury, supporting more women into engineering and STEM pathways.
Alongside this, we offer a range of career pathways, and this year had 27 team members involved in graduate, apprenticeship, or internship programs. Our people are at the core of our business, and these initiatives are critical to ensuring Scott's ongoing success. I'd now like to pass back to Mike for his closing comments. Thank you.
Thank you, Casey. So, as you will have heard from Stuart and the other members of the management team, there have been significant investments in the organization, and great progress has been made on all fronts in the last year. Let me take the opportunity just to summarize some of those points. And I'm going to do these slightly out of order. Safety remains our top priority. With the rapidly evolving ESG scenario, we can't emphasize our commitment to safety.
Our 2027 strategy, which is designed to leverage our proven expertise, focuses on large, addressable markets where we can make the biggest impact. We've embedded commercial partnerships with top-tier blue-chip customers, which continue to be the cornerstone of our approach. As Casey said, at the heart of Scott is a highly engaged global team, supported by a well-invested footprint, which enables us to consistently deliver value. We're also focused on advancing our productization with scalable, repeatable solutions, which ensures that we are well-positioned for future growth in the market. And finally, it's worth noting the top-line growth trend that we've managed over the last four years. It's a testament to the collective effort of everybody at Scott.
The talented team have set up a very strong foundation for the future, and I am really excited to be able to work with the team and everybody to build upon this momentum as we together move forward. So I'd like to thank you very much and pass back to Stuart. Thank you.
Thank you, Mike. I would now like to give shareholders the opportunity to ask questions, whether related to the presentations, the financial statements, or the management of the company. Shareholders online can continue to provide questions through the portal, and we will also address questions from the room. When I call for questions, can shareholders present in the room please wait until a microphone is provided to you and clearly state your name before asking the question? I will take questions from those present in the meeting first before moving on to any questions from shareholders online.
I ask that in the interest of fairness to all shareholders attending this meeting, that anyone wishing to ask questions be as concise as possible and be considerate to other shareholders wishing to ask questions. Media will be given the opportunity to ask questions after the meeting. Are there any questions from shareholders? No? Okay. Are there any questions from shareholders and attendees online?
Yes. There's a few here. This is asked by David Tennyson. On page 52 of the annual report, the Australian goodwill was reduced from NZD 13.8 million to NZD 5 million over the year, yet there has been no write-off goodwill over that period. Where did the variance of the missing goodwill disappear to? Mark?
Yeah, thanks, Anthony. Nice technical question, but during the period, we changed from reporting five cash-generating units to six in our financial statements.
This was with the addition of Rocklabs as a separate cash-generating unit. This is in line with how we manage the business, how it's structured, and how we report. So effectively, there was goodwill transferred from both the New Zealand and Australian cash-generating units to Rocklabs in the period.
Thank you, Mark. Okay. Are there any further questions?
Yeah, there's a few here. This is from Martin Watson. The market value and Stuart? This is your way. The market value of Scott Technology has shown a 20-year pattern of mean reversion, which has meant that there's not been enduring growth in shareholder value. How does the board view this problem, and what plans are in place to break the company out of this cycle?
Interesting question. So Scott is about creating value, not only in its innovation for other businesses, but also in creating value for shareholders.
The business has transformed itself from when we only produced - I shouldn't say only - Graham. It was appliance manufacturing, and that was the core of our business. And from there, we've developed other technologies. And I believe that we're on the brink of very exciting developments for the company, and you heard from both myself and the team of all the new innovative solutions we've got for the marketplace. So that should translate into steady profits and good returns for shareholders.
Okay. This is from Bruce Parks. To what degree is our presence in North America at risk from tariffs promised by the incoming administration in the USA?
I'd love this one. In fact, if you look back at my speeches back in, I think, 2016, I gave a warning back in those days for this fellow by the name of Trump.
It's interesting. There's been a fair bit of bluster from him, and I'm sure in his own mind he wants to bring these tariffs in. But if you read widely, it's not as straightforward as he thinks it is because China is a big part of the world now, and they can really punish America, especially in their agricultural products. So even if there are tariffs brought in, there will be retaliatory tariffs, and overall, it won't be good for New Zealand and smaller trading partners. Our major area of concern is China because China takes a lot of our production, not Scott, I'm talking about New Zealand Inc, and so any retaliation from America on China, they'll have less money to spend, and that could impact on our products. But we're well-insulated as a company. We've got footprint, as you know, in China, Europe, the U.S., Australia, and New Zealand.
So we will find ways to make sure that the impact of any tariffs will be minimal. But a good question, and it's. We don't know until he comes in. He's certainly making lots of noises. I'm told that one of his picks for his cabinet have already been rolled, so hopefully they roll a few more.
Okay. Stuart, this is from Alex Ball. Does Scott Technology publish its dividend and other forms of distribution policy, and does it also have a target range for net debt?
Well, when I first came as chairman, the range was zero. John's father was very conservative, and the first thing he said to me when I took over, he said, "You're allowed to take on some debt, and you're allowed to buy some goodwill, and you can grow the company." So I've never forgotten those words. But certainly, we manage our debt position.
We're fortunate, or we've been more fortunate in the past, in the nature of our business. We used to get large deposits upfront, 30% of the job. So often, we had a credit balance with a lot of the customers. So what was the first part of the question? Does Scott Technology publish its dividend and other forms of distribution policy? Right. Well, we should have a dividend policy as a board. Yep. I'm looking at mine.
Yeah. So we try to, we've got to retain profits for growth, and as set out by the team, we've invested heavily in equipment in the last 12 months and new facilities, but we'd like to also reward our shareholders. We have, in the past, had our DRP operating, and we've got it operating now. So there's a chance for further investment by shareholders.
But in terms of our debt levels, we're still conservative in our approach, and I think that the range that we're operating in is very comfortable. Unless our auditors disagree.
Another question from Bruce Parks. Issuing a sustainability report 30 minutes before the annual meeting is a high challenge, even for speed readers. Will the board ensure subsequent reports are issued with adequate time for shareholder perusal before an annual meeting?
Absolutely. The intention was to get it out earlier, but because it was the first time, and most corporates, and I'm involved in two other listed companies, we did not issue by the annual meeting. There's a four-month lag that you have to file within, so we've still got another month legally. But the team, being a small company, have done a fantastic job, led by Casey.
So yes, the answer is, having got the first one out, the subsequent ones will be hopefully released with our annual report, and that's what we targeted for this year.
Thanks. This is from Nitesh Verma, along the same lines. How do you see institutional investors rewarding your ESG disclosures? Can you point to specific funds or investors and their preferences, for example, standards for such disclosure?
Well, I can answer it with another hat on. I chair the University Foundation Trust, and we do a lot of investing in eco-friendly funds, and those funds, in a lot of cases, are outperforming the traditional funds. So hopefully, with the work that our team are doing and what we're doing in our ESG journey, we'll be rewarded by investment from funds and by investors who support what we're doing.
Okay. This is from Alex Ball again.
Is there any further update on the FY25 outlook that the company can provide beyond what was included in the annual report?
We've never given updates at this point, so the board won't change from there. Okay. And then the last one here. The strategic review of ownership structure consumed NZD 3.2 million of shareholder funds for no apparent outcome. This seems an extraordinary amount of money. It seems you paid a success fee with no success. What was the money used for, and what did you learn? What is next in terms of Scott's ownership structure, which you must agree is not optimal for shareholder value? So first of all, there was no success fee, so there were costs incurred. We had a number of leading consultants, and we did a full review, and it was about ownership.
JBS have confirmed their support for the company, and the management, of course, with Mike on board now, that has focused the areas that we intend to be playing in, and we're always looking at where we can release value for shareholders, and that will continue into the future, so I don't believe it was a waste of money. It has been unsuccessful, the outcome at that point, but it's ongoing,
and just to add to that, Stuart, there's kind of three main things that we've been working through as a leadership team. One of the outcomes from that was that we needed to grow margins in our MHL business, and Aaron's already talked to that today during the year. The second one was we need to increase our aftermarket and service business, and we've talked about that today, which we're doing.
And the third one was very much around continuing to streamline the business around its core sectors, and that has, to a lesser extent, but that is an ongoing process which I'm sure Mike will bring his lens to in due course.
Thank you. Any more questions? That is it.
Well, that's the most I've had in all the time I've been chairman. So good questions. Okay. So shareholders joining us today here, and you've been given your shareholder voting card. If your shareholder did not register on arrival and wished to vote, please make your way to the registration desk, and staff from MUFG will assist you. Please mark your voting intention for each resolution, and the voting cards will be collected at the conclusion of the meeting. Shareholders joining online will be able to cast their vote using the electronic voting card received when online registration is validated.
To vote, you'll need to click "Get Voting Card" within the online meeting platform. You'll be asked to enter your shareholder or proxy number to validate. Please then mark your voting card in the way you wish to vote by clicking "For," "Against," or "Abstain" against each resolution on the voting card. Once you've made your selections, please click "Submit Vote" on the bottom of the card to lodge your vote. So just advice for people out there: get a grandchild. They'll sort it out for you. Voting will remain open until five minutes after the conclusion of the meeting. Results of the vote will be announced via the exchange.
Each resolution set out in the notice of meeting is to be considered as an ordinary resolution and, as such, must be approved by a simple majority of the votes cast by shareholders entitled to vote in voting on the resolution. The outcome of proxy votes will be displayed for your information after voting all of the resolutions. Ladies and gentlemen, we now come to the formal part of the business matters requiring resolution, which are outlined in the notice of meeting. There will be an opportunity for shareholders to ask questions on each matter put to shareholders. For the sake of good order, shareholders' questions raised should relate directly to the matter being considered. Now, moving to the resolutions, a poll will be held on each of these resolutions. Resolution One: Re-election of Director Brent Eastwood.
That Brent Eastwood, who retires as a director and being eligible, offers himself for re-election by shareholders to be re-elected as a director. Please now vote as you see fit. Are there any questions from shareholders on this resolution? But first of all, Brent unfortunately can't be with us today. He has business commitment, and straight after this meeting, which he's attending online, Brent's flying to Darwin, so out of Queensland. So Brent is Chief Executive Officer of JBS Foods Australia, a position he has held since September 2012. Prior to this, he was Chief Operating Officer of JBS Australia Northern. Brent has extensive international experience in business leadership and the sales and marketing of animal protein. He has worked in executive roles within JBS USA, including head of JBS Trading Worldwide, Vice President Beef Sales USA, and President of JBS Carriers USA.
His prior experience in Australia included time with JBS's predecessor company, Australian Meat Holdings, as General Manager of AMH Trading Division for five years, eight years in meat trading with the D.R. Johnston Group, and three years as CEO of the ConAgra Trade Group in Sydney. Brent is also a graduate and member of the Australian Institute of Company Directors. Brent won't mind me saying this, but he also started his life in the meat industry with Alliance, and he was involved with the Ocean Beach Freezing Works before he headed off overseas. Brent brings a wide range of business acumen to the board. Right. Are there any questions from shareholders on this resolution? Are there any questions from shareholders in attendance online? No. Right. Everyone's had time to... So election of Director John Foreman.
That John Foreman, who was appointed as a director by the board during the year, be elected as a director of the company. I'll now ask John to come forward and say a few words.
Thanks, Stuart. I've been a director of Scott Technology for six and a half years, and I'm also the Chair of the audit committee. Outside of Scott, I've worked for a number of professional service firms in New Zealand and also across Europe, helping businesses expand and operate around the world and also do acquisitions and integration of those acquisitions. I also have founded my own business called Corporate Services New Zealand, where I also provide directorship services to other multinational businesses who are operating in New Zealand.
Thank you, John. On that resolution, please now vote as you see fit. Are there any questions from shareholders present on this resolution?
Are there any questions from shareholders in attendance online?
No.
No. Okay. Resolution Three: To record the reappointment of Deloitte as auditor of the company and to authorize the directors to fix the auditor's remuneration. Please now vote as you see fit. Are there any questions from shareholders on this resolution? Are there any questions from shareholders in attendance online? No. Thank you. That completes voting on the resolutions. At this time, I'd like to advise the outcome of proxy votes that were lodged in respect of each of the resolutions. I will now read the proxy results for each resolution, but they are showing up on the screen. The registrar MUFG will now move through the room to collect your voting cards. For those shareholders online, you can now submit your vote if you haven't done so already.
Voting will be open until five minutes after the conclusion of the meeting. Are there any final questions before I close the mee ting?
There's one online.
One online?
From Chris Webb: Has Scott looked at putting in solar power and water recycling facilities on its buildings?
The answer is yes. Is it Auckland we're looking?
Yeah. So as part of our 30 by 30 commitment, we're looking into renewable energy options across the entire group, and obviously, solar panels are part of that. Yep.
And the chairman is staying in Halswell, along with his wife. We've got 28 panels, and we're self-sufficient and don't need them. If there's no further questions, I'll thank everyone for your attendance, and I'll close the meeting. So are we level?
Yes.
Next door.
Yep.
So once you've finished your voting, if you'd like to move through, and there'll be refreshments.