Good afternoon, ladies and gentlemen and fellow shareholders. I'm Liz Coutts, Chair of Skellerup Holdings Limited. Thank you for joining us for the 2021 annual meeting of Skellerup Holdings Limited, albeit in different circumstances to how we normally convene. The notice of meeting and 2021 annual report have been circulated and made available to all shareholders. You can also access these at any time via our website. Today's meeting is being held online by the Computershare online meeting platform. If you are here, congratulations. You have successfully negotiated entry. To begin, I would like to introduce your board. First, Alan Isaac, John Strowger, David Cushing, and Paul Shearer join us virtually. David Mair, Director and CEO, and Graham Leaming, CFO, are with me here in Auckland, suitably spaced, I should add.
In virtual attendance are representatives of our auditors, Ernst & Young, including our lead audit partner, Simon O'Connor, and our lawyers, Chapman Tripp. Finally, a number of our leaders across the Skellerup group have also joined online. Welcome to you all. Before I summarize the order of events for today, I will explain how you may vote on resolutions and how you may submit questions. Voting today will be conducted by way of poll on all items of business. In order to provide you with enough time to vote, I will shortly open the voting for all resolutions. At that time, if you are eligible to vote at this meeting, you will be able to cast your vote under the Vote tab on your screen. Once the voting has opened, the resolutions will allow votes to be submitted.
To vote, simply select your voting direction from the options shown on screen. You can vote for all resolutions at once or each resolution in turn. Your vote has been cast when a tick appears. To change your vote, simply select Change Your Vote. You have the ability to change your vote up until the time I declare voting closed. You can submit a question at any time. To do so, select the Q&A tab at the right half of your screen. Type your question into the field and press Send. Your question will immediately be submitted. Should you require assistance, you can type your query, and one of the Computershare team will assist and reply via the chat function. Alternatively, you may call Computershare on 0800 650 034.
Please note that while you can submit your questions from now on, I will not address them until the relevant time in the meeting. Please note that your questions may be moderated or, if we receive multiple questions on one topic, amalgamated together. Finally, due to time constraints, we may run out of time to answer all questions. If this happens, we will answer them in due course by email. We will now move to the business of the meeting. I now declare voting open on all items of business. The resolutions will now be open in the Vote tab. Please submit your votes at any time. I will give you warning before I move to close voting. I will shortly provide a summary of Skellerup highlights and then hand over to David Mair to give a more detailed presentation on Skellerup.
Following David's address, we will respond to questions from you on our presentations. I will then put the resolutions outlined in the notice of meeting to vote. We will cover each resolution in turn and respond to questions specific to each of those resolutions. Finally, I will provide a further opportunity for general questions on Skellerup as part of general business towards the end of the meeting. Well, good afternoon and welcome to Skellerup's 2021 annual meeting, our first virtual one. I would love nothing more than to be celebrating in our traditional way over afternoon tea with a glass of wine and another beverage here. With things being what they are, today's celebration is necessarily more muted. I'm nonetheless confident that when we get together next year, we can not only make up for lost time, but we'll also have fresh cause to raise our glasses.
Let's start in the now. We are now more than 18 months into the global pandemic and are living with the massive disruption it has created. This has forced the value of having a solid foundation, one that has allowed us to adapt to the unique and complex challenges posed by the pandemic. The FY 2021 result reveals that the continuing strength of our strategy and business model is our solid foundation. The leadership of our management team and the skill and adaptability of all our people, combined with the unrelenting customer focus, has allowed us to keep growing that foundation. It is therefore with real pride that Skellerup can report another record year. That record is across the board. Net profit after tax is NZD 40.2 million, up 38%, which beats our recent record results.
As a growth business, achieving a record operating cash flow of NZD 58.8 million, up 22% from the prior record in FY 2020, is also a standout measure of performance. This enabled us to fund our capital expenditure requirements, reduce debt down NZD 19.8 million to net debt of NZD 8.7 million, and substantially lift our final dividend. The final dividend imputed to 50% increased from NZD 0.075 to NZD 0.105 per share, and was paid to shareholders on the 15th of October, 2021, with a record date of 1st of October, 2021. This brought the total dividend payout for the financial year ending in the 30th of June, 2021 to NZD 0.17 per share, up 31% on the prior year. Rewarding shareholders is a vital metrics for us, and over the past 10 years, the payout has almost tripled.
The board is delighted with this level of growth, and we are pleased your loyalty to Skellerup has been rewarded so well. Skellerup is a New Zealand success story and a global company with businesses in New Zealand, Australia, China, Italy, the United Kingdom, and the United States. 80% of our revenue is derived offshore. With a strong domestic presence and global reach comes great growth opportunities, but also greater complexity. Our strong balance sheet has allowed Skellerup to take advantage of growth opportunities, and in August, we acquired Talbot Technologies, a 25-year-old well-established business that designs, develops, and manufactures highly engineered plastic products for domestic and international markets. That acquisition strengthens and broadens Skellerup's capability with the proven expertise of the Talbot team, so adds value to our business. Our growth business would face complexity under benign conditions.
With the disruptions caused by the global pandemic, we and our workforce faced an enormously trying year. What last year seemed novel and therefore tinged with the challenge to overcome, as well as a lot of uncertainty, has given way to the sustained grind of the pandemic, both physically and psychologically. In some countries, the disruption has been extreme, with long and more restrictive work conditions for our people, prolonged periods of working from home, and more recently, supply chain challenges, testing our relationships with customers. Our workforce has risen to the challenge, and we cannot speak highly of them. They have shown remarkable adaptability. We've supported their collective effort and responsibility to work safely. They have supported Skellerup by keeping their focus, notwithstanding the disruptive challenge faced in satisfying customers. Working closely with key customers is the foundation to Skellerup's success.
The adaptability of our people to maintain that focus, be flexible in planning, and be responsive to the changing needs of customers to ensure those needs are met, is a testament to their tenacity and quality. Our record result this year is a result of their collective effort, and we thank them for it. Skellerup takes seriously its responsibility to grow our business sustainably. Reducing waste and our environmental impact domestically and overseas forms part of Skellerup's commitment to continuous improvement on sustainability. Because we review sustainability widely, that is working closely with customers, developing and investing in our people, and minimizing emissions and waste, it is not an either/or proposition for us. Growing a sustainable business is core philosophy to Skellerup. Our directors have also faced a challenge. I've spoken of the increasing complexity of the business.
The board has a wealth of commercial and governance experience, and we have worked hard to ensure thorough oversight, visibility, and provide strong governance to support David and his team. Despite being unable to travel to our international businesses, we have been active visiting our domestic sites to observe and understand our operating environments and meet with our people. We've also invited leaders in both our domestic and overseas businesses to join our virtual board meetings to present and discuss their plans, risks, and opportunities with us. The increase in workload and time commitment of directors, together with the need to plan succession, given the substantial institutional and industry knowledge of our long-serving directors, means the board is considering both the size of the board and the directors' skills needed to maintain strong board oversight and governance into the future. Skellerup's future is positive.
Our strategy and business model were tested by the global pandemic and they not just survived, they thrived, as our record result shows. To reinforce our confidence and optimism, I'll make a comment on our current trading performance. We have made a strong start to FY 2022. We have met continued high customer demand despite the constraints of elongated shipping transit times. We expect our net profit after tax for the first half of FY 2022 to be in excess of 10% above the prior comparative period. In closing, on behalf of the board, I want to emphasize the board's pleasure at the FY 2021 result, express our optimism for the future. I would like to thank David and his team for their leadership. Most of all, I want to thank you, our shareholders, for your encouragement and support. To David.
Thanks, Liz. Last year, I was proud of how well Skellerup managed to perform despite the disruption caused by COVID. The strength of our strategy and business model was tested, as was the resilience of our customer base. Excuse me. Skellerup rose to its challenge and passed its test with record results. One year on, I'm pleased with the excellent results our team have delivered and hugely optimistic about our future. The record result across the board is a testament to the skill and commitment to Skellerup's ambition for global leadership in the design, manufacturing, and distribution of precision engineered products. Record revenue, record earnings before interest and tax, record net profit after tax, and record cash flow and dividends were not accidental.
They were the culmination of years of thinking hard about the essence of our business and years of making deliberate choices to lay a solid foundation and build a stronger business. Build it even stronger we will, because we are focused always on Skellerup's ongoing success. The COVID-19 marathon. One of the true truisms that has emerged about COVID is that responding to it is a marathon, not a sprint. A company with the history of Skellerup is built for marathon running, the long haul. Skellerup's success in responding to the global disruption is not surprising. Over many decades, we've built our endurance and speed, clocking up the miles, training smart in often difficult conditions while we worked on our race strategy. FY 2021 is a testament to all the preparation and hard work that has gone before.
We've run a winning race, but I'm here to tell you today that our ambition is to keep performing, maintain our strategy, and keep succeeding whatever the conditions. Also, like a marathon runner, we couldn't have achieved our record result without our support team. Skellerup is essentially a people business. Our customers, suppliers, employees, the communities we influence, and you, our shareholders, have all contributed to our success. It's your success too, and we thank you for your ongoing support and confidence in us. Skellerup is a great global growth-oriented business. Skellerup's business foundation, our strategy and business model is strong. The essence of Skellerup is combining deep material expertise that is hard to reverse engineer, strong product and tool design capability, and proven scalable manufacturing process knowledge.
Our ability to deliver critical and essential products that often bundle multiple materials to meet demanding and ever-shifting regulatory standards is our competitive advantage, and one we believe is not easily replicated. We have built on our foundation and competitive advantage through Skellerup's unwavering focus on our customers. We stay close to them so that we can understand their challenges and can respond with new approaches and innovative products that make a positive difference to their businesses. Our customers' needs are central to all our development work. We develop products for predominantly original equipment manufacturers customers. From our technical salespeople to our engineers and chemists, we work closely with our customers to develop and deliver reliable products that meet their needs. As I said in the annual report, without demanding customers, we have no business and no opportunities to develop new solutions.
Maintaining our laser-like customer focus is good for them and good for Skellerup. In the same way we strive to be the best supplier to our customers, we also want to be the best customer for our suppliers. We are demanding of them, but fair. Skellerup has a global reach and ambition. Approximately 80% of our revenue is generated in international markets, and 70% of our revenue is generated from products manufactured outside New Zealand. Our products are critical to the supply of safe potable water, the production of milk and milk products, the performance of appliances in home and workplaces, health and hygiene in hospitals, shops, and homes, the safety and comfort of sporting and leisure equipment, and the integrity of roofing systems on homes and workplaces.
We employ over 800 people spanning five continents with businesses in New Zealand, Australia, China, Italy, the United Kingdom, and the United States. As a growth-oriented international company, I am especially pleased with our cash flow position. With net debt down NZD 19.8 million to NZD 8.7 million, our balance sheet is strong. One benefit of a strong balance sheet is being able to reward our shareholders by lifting dividends. A second benefit is enabling Skellerup's growth strategy. Since our annual report was published, and as Liz mentioned earlier, Skellerup acquired Talbot Technologies in August. Acquisitions are very carefully evaluated to ensure alignment with our business to enable Skellerup to enhance the value we deliver to customers.
Talbot, with its demonstrated expertise in supplying plastic products for domestic and international companies specializing in health, technology, and electronics applications, was a natural fit for us. The industrial division results from our industrial division were outstanding, showing a revenue increase for the fifth consecutive year. Sales growth and gross margin improvements combined to increase earnings before interest and tax by 57% to a record NZD 32.7 million. That revenue growth was broad-based and across product lines and in different markets. Working closely with our customers to understand their needs in designing products that perform is the hallmark of our industrial division's businesses. That focus, I should add, is paying dividends. One example, our expertise in deep material science is also paying off. During this last financial year, we completed a project to reformulate compounds for a range of potable water products in Australia.
This project required a mix of deep material science, engineering, tooling, and process expertise. By working closely with our customer and regulators, we demonstrated our expertise. This enhanced customers' trust in our products and is resulting in further growth opportunities for Skellerup, our agri business. Earnings before interest and tax in our agri division increased by 20% to a record NZD 30.5 million. This was on the back of both sales growth and gross margin improvements. We are the second-largest manufacturer of food-grade dairy rubberware globally. While our strength remains in the U.S. and New Zealand markets, Europe and Asia were our fastest-growing regions last financial year. Continuous process improvement underpins our ability to meet our increasing demand without significant capital investment or increased operating costs. Now our people. Our people have risen magnificently to the challenges they've faced since COVID struck.
They are spread geographically, so each has faced a different quality of disruption. It's humbling as chief executive to see their tenacity, adaptability, and loyalty in the face of a disruption that severely impacted our people's working and personal lives. We acknowledge, too, their families and their support. They have shared in the sacrifices that have been made, and we thank them for it. These qualities are irreplaceable and are further evidenced by Skellerup suffering no significant redundancies since COVID began over 18 months ago. In fact, we've grown our workforce 2% in FY 2021. Skellerup's leaders and our teams have performed with great skill and tenacity. We have supported them by investing significant financial and human capital in upgrading our information systems to help them work even better with our customers, to develop more innovative solutions, and to drive greater efficiency.
We have lifted our minimum wages for workers across several jurisdictions. We are proud to be able to reward our team well for the work they do. Our stable and focused team are a true asset of the business. At Skellerup, we regard health and safety as our highest priority. Every Skellerup site globally has an active health and safety committee that meets monthly. The board has oversight of our health and safety programs. We report to it monthly. A collaborative approach works, as evidenced by for the second successive year, no serious harm injuries. Because we are an international business, one working with a complex web of suppliers and customers around the globe, maintaining the highest standard of ethics is also important to us.
We work with our leaders to discuss the behaviors required and outlined in our code of ethics and, as importantly, how they and we respond to any reported violations. I'm pleased to report we did not receive any reports in this regard in FY 2021. As proud as I am of our performance last year, and I'm immensely proud, it is no time to rest on our laurels. We'll learn from our successes, but we are not just a customer-oriented business, we are also a future-oriented one. We have a lot of optimism about that future. We have proven confidence in the strategy and business model that has fueled our growth and performance. Our fundamentals for operating a sustainable business, working closely with customers and investing in our people, are strong.
Liz has commented on the strong start we have made to FY 2022 and our expectation that NPAT for the first half of FY 2022 will be in excess of 10% above prior corresponding period. Staying close to our customers and our suppliers and adjusting our actions in response to changes and expected changes will be critical to achieving continued growth. In closing, I'd like to thank Liz and the board for their ongoing support. Thanks again to the Skellerup team for their commitment and determination to making this a great global business. Thank you to you, our shareholders, for your support and confidence. We are optimistic about our ability to continue delivering strong returns. Thank you.
Thank you, David.
Thanks, Liz.
We will now take questions from you on our presentation. Graham, is there any questions?
No questions at this time, Liz.
Thank you, Graham. We will now vote on the resolutions contained in the notice of meeting. We have four resolutions to be voted on today. The first two relating to the re-election of John Strowger and Alan Isaac as directors, and the third to directors' fees, and the fourth being the auditors' fees. As noted earlier, in accordance with the NZX listing rules, voting will be by poll. A number of shareholders have cast a postal vote or have appointed proxies to cast their vote ahead of today's meeting. I advise the board is holding discretionary proxies that will be voted in favor of all the resolutions. The results of the meeting will be published to the market later today. Resolution one, re-election of John Strowger. In accordance with the company's constitution, John Strowger retires at this meeting and being eligible, offers himself for re-election.
The board recommends John to you as a director of Skellerup and unanimously supports his election. Before we consider the resolution, I would like to invite John to briefly talk in support of his re-election. John.
Thanks, Liz, and good afternoon, everybody. Perhaps it's my function here to buy time to give Graham a chance to receive some questions that we can speak to later. Good afternoon to you all. Hoping that you and all your families are safe and well in these rather unique times in which we live. For those of you who don't know me, I am John Strowger, a commercial lawyer at the law firm Chapman Tripp national law firm, where I practice primarily in the corporate and commercial areas involving mergers and acquisitions, equity capital markets and private equity. Also lead the firm's endeavors in relation to its China desk trade, both inbound and outbound with China.
I find, to my astonishment, I've been doing this job for 35 years, probably closer to the end of my career in this regard than I am the start. I'd like to think that I've spent most of that time trying to ensure in practice that the lawyer's function in life is to facilitate transactions, not let law get in the way of commerce. I'd like to think that I, to some degree at least, bring that perspective to my role with Skellerup. You would have thought with a 100% increase in share price and a 38% increase in NPAT in the last year, I probably present to you with the benefit of a favorable wind.
I'm reminded of a couple of other truisms in life which I think are particularly germane to Skellerup's current position and my candidacy. The first is that overnight success sure as hell took a long time. As David said in his presentation, and it's almost like I read it first. The results we're enjoying this year and last have been the cumulative effect of a serious amount of perspiration and effort by in particular our senior management team over a concerted period of time. There are no paradigm shifts with Skellerup. It's just the cumulative effect of a small number of incremental operational and market improvements which has seen us get to where we are today.
Now, the other phrase I'm reminded of is that success has many parents. Again, David has rightly referred to the tremendous efforts of our staff and senior people operating in a difficult environment in the last twelve months. It's entirely due to them that we find ourselves reporting to you today that the result that we have. If I reflect on where we are today and perhaps the cynic's proposition that in times of good a board should leave management alone and think about what the board's function as we sit here today looking forward really is at its most critical.
To me, it is to ensure that we seize the momentum that we've achieved over the last couple of years, institutionalize a lot of the gains and practices, and ensure that this business is not unique to any one individual. We'll continue when the marathoners amongst us have finished our runs, David, and the time comes for others to take the helm. I'm very anxious to ensure that the benefits of the last few years are not lost and that the momentum is maintained. Skellerup has had a long history, a proud history of entrepreneurialism and opportunism. We've been very light-handed in debt, and I don't want us to lose that. At the same time, I think we need to.
We are moving into a new phase in the organization where this is now a large institution. It's a group with a market cap of over NZD 1 billion, and we may as well start acting like we are. I would like to think that if I'm favored with your vote today, I can make a continuing contribution to ensure that. Thanks for your time.
Thank you, John. I now move as an ordinary resolution that John Strowger be re-elected as a director of the company. Graham, are there any questions on this resolution?
No, Liz, there's no questions in respect to this resolution.
Okay. Thank you. We are in favor. There's no questions. We'll move on to resolution two, re-election of Alan Isaac. In accordance with the company's constitution, Alan Isaac retires at this meeting and being eligible, offers himself for re-election. The board recommends Alan to you as the director of Skellerup and unanimously supports his election. Before we consider the resolution, I would like to invite Alan to briefly talk in support of his election. Alan.
Thanks, Liz. Good afternoon, everyone, wherever you are today. I welcome the opportunity to speak briefly to you. By profession, I'm a chartered accountant, but I've had significant commercial experience with a number of leadership roles both in New Zealand and internationally. I mention the commercial experience because in my opinion, experience is being undervalued today in the interest of a greater focus on diversity in many aspects of our life.
I retired from KPMG in 2006 after leading the firm in New Zealand for 10 years and have been a professional company director since then. In my governance roles, I chair a number of audit and risk committees as I do at Skellerup. In addition to my other current listed roles, Oceania and Scales, I have in recent times been on the board of other NZX-listed companies, Opus, Wakefield Hospital, and Freightways. For the past two years, up until the end of July, I was the president of the New Zealand Institute of Directors, which has facilitated me keeping up to date with many current and emerging governance issues.
I'd also note that personally, or through my family trust, I have an interest in 50,000 shares in Skellerup. I believe we have a great board with a high level of trust and respect in each other, and I look forward to your support so that I can continue to add value to Skellerup, which as David and Liz have mentioned, has a strong balance sheet and is well-placed to achieve profitable growth. Thank you.
Thank you, Alan. I now move as an ordinary resolution that Alan Isaac be elected as a director of the company. Graham, are there any questions on this resolution?
Again, Liz, no questions on this resolution.
Okay. Thank you, Graham. Okay. No, no questions. I'll now move to resolution three, director's fees. We now move to the resolution to increase the pool available for payment of director's fees. It is proposed to increase the total pool of director's fees by NZD 100,000 from NZD 550,000 to NZD 650,000 per annum. The director's pool, fee pool, was last reviewed in 2016. The board seek an increase in the total pool for the following reasons. The company has experienced significant growth and robust financial performance since the director fee pool was last approved five years ago in 2016. Secondly, the company continues to grow in complexity and has significant global operations with a consequent increasing workload for directors, including the workload of those directors appointed to committees of the board.
Directors' workloads will increase with more legislative and regulatory changes than proposed, stakeholders' expectations increasing to consider and monitor a broader range of non-financial measures together with governing through the ongoing uncertainties of COVID. Thirdly, to ensure the company can offer competitive fees to attract and retain non-executive directors of a high caliber. Lastly, to allocate all committee fees if and as required. The board considers, in light of the realities of the increased workloads and responsibilities undertaken by the board, in consideration of the independent report referenced in the notice of meeting and made available on our website, that the proposed increased fees pool is fair and reflective of market conditions. The present and planned allocation of fees is shown in the notice of meeting. The directors recommend that shareholders vote to approve this resolution.
However, directors and their associates will not be exercising their own voting, their own shareholder votes or discretionary proxy votes on this resolution at the annual meeting, and any such votes will be disregarded by the company. I now move that the directors' fees be increased from NZD 550,000 to NZD 650,000 per annum, being the aggregate amount payable to all directors of the company for their services as directors of the company, with such sum to be divided among the directors as the board may from time to time determine. Graham, are there any questions on this resolution, please?
Liz, no questions on this resolution either.
All right. Thank you, Graham. With that, I'll now move to resolution 4, remuneration of the auditor. Ernst & Young are the existing auditors of Skellerup. Pursuant to Section 207T of the Companies Act, Ernst & Young are automatically reappointed as auditors for the ensuing year. The board seeks the approval of shareholders to be authorized to fix the remuneration of Ernst & Young for the 2022 financial year. I now move as an ordinary resolution that the directors be authorized to fix the remuneration of the auditor for the year ended 30th of June 2022. Graham, are there any questions on this resolution, please?
No questions, Liz.
Thank you. We've reached the time in the meeting now. At this point, we will take any further questions on Skellerup's financial and operational performance and any other matters shareholders would like to raise. Graham, do we have any other questions on any other matters?
Liz, there's still no further questions.
Okay. Well, look, I'm going to just wait a little time before I close the voting. I'm gonna close the voting, probably in about a minute. Please ensure you cast your vote on all the resolutions, and we'll just take a moment to pause. I want to make sure that you get plenty of time to do that. Well, hopefully you've been able to navigate that voting system. Look, thank you for your attendance today, and hopefully next year we can resume having those that are able to join us in person so that you can have the opportunity to meet our people, see and discuss our products and the business we are so passionate about. I will now formally close the voting and declare the meeting closed. Thank you. We really appreciate your attendance.
Thank you.