Hello, and welcome to the WD-forty Company's 2020 Annual Meeting of Stockholders. Please note that today's meeting is being recorded. During the meeting, we will have a question and answer session. You can submit questions or comments at any time by clicking on the message icon. It is now my pleasure to turn today's meeting over to Gary Ridge, Chairman and CEO of WD-forty Company.
Mr. Ridge, the floor is yours.
Good day, and welcome to WD-forty Company's 2020 Annual Meeting of Stockholders. Today, we may be a little muffled, even though we are practicing social distancing here in our office, we've chosen to wear masks as the safety and the well-being of our tribe is our number one priority. I'm very happy to welcome you to our first ever virtual Annual Meeting of Stockholders. We believe that the in engaging with shareholders and we hope that this virtual meeting will maximize the participation of shareholders while keeping the health and well-being of our meeting participants as a top priority. Before calling the meeting to order, I'd like to introduce other participants who are in attendance at our annual virtual meeting.
To begin, I'd like to welcome and introduce you to Lara Lee, a nominee for election to the Board at today's meeting. Lara served as President of Orchard Supply Hardware, a subsidiary of Loews Companies from 2016 to 2018 and as Senior Vice President of Loews from 2013 to 2018. Her career experience includes 6 years for innovation consulting firms Continuum and Jump Associates as well as 15 years with Harley Davidson Motor Company. Lara's international and management experience, including expertise in strategic marketing and innovation provides an excellent complement to our Board's diverse range of skills and management experience. The following directors are also in virtual attendance today.
Daniel Carter served as Executive Vice President and Chief Financial Officer of BevMo. Dan is the Chair of our Audit Committee. Melissa Klassen is Vice President, Finance, Emerging Markets of the Adidas Group and she is stationed in Dubai. Eric Eckard served as Senior Vice President for the Manitoba Company. Eric is Chair of our Corporate Governance Committee.
Trevor Mihalik is Executive Vice President and Chief Financial Officer at Sempra Energy. Trevor is Chair of our Finance Committee. Graciela Monteguro was elected to the Board in June. Graciela served as President and CEO of Lara U. S.
David Pendarvis is Chief Administration Officer and General Counsel of ResMed. Gregory Sandfoot served as President and Chief Executive Officer of Tractor Supply Company. Greg is the current Chair of our Compensation Committee, and he was designated as our Lead Independent Director in October. Ann Saunders served as President U. S.
Of nakedwines dotcom. The Board intends to appoint Anne as Chair of our Compensation Committee immediately after today's meeting. Also with us today are Neill Schmoorley and Dan Pittard, who are not standing for reelection this year. On behalf of the Board, I'd like to express tremendous gratitude to Neil and Dan for their many contributions to the company's success. Also participating on our call today is Jay Rembold, our Chief Financial Officer Steve Brass, our President and Chief Operating Officer Rich Clampett, our Vice President, General Counsel and Corporate Secretary and Wendy Kelley, our Director of Investor Relations and Corporate Communications.
Last, but certainly not least, Sarah Heizer is in attendance representing PricewaterhouseCoopers, the company's auditors. For the business matters to be conducted here today, I will act as Chairman of this meeting. Rich Clampett will act as Secretary of the meeting. We will now officially start the meeting by confirming that the proper notice of the meeting has been given and that we have a quorum.
Thank you. I'm pleased to announce that proper notice of the meeting has been given and that at least 12,750,000
shares are represented in person or by proxy constituting a quorum. Thank you. I now call this meeting to order. Following the secretary's introduction of the matters to be acted upon by stockholders vote, At this meeting, our management team will share a brief business update, then we'll take questions from online audience, and thereafter, the formal meeting of stockholders will adjourn.
There are 4 meetings 4 matters for stockholder consideration and voting at today's meeting: the election of directors, an advisory vote to approve executive compensation, the ratification of the selection of our independent auditors and a shareholder proposal to adopt a policy to include non management employees as prospective director candidates. The shareholder proposal proponent, Mr. Mick Ritchie, is in attendance at today's meeting and will be afforded an opportunity to speak in support of his proposal. Stockholders have been encouraged to vote in advance of the meeting. However, if you have not yet voted or would like to change your vote, any stockholder attending the virtual meeting today who has entered the meeting with a control number may vote any time prior to the adjournment of today's meeting.
If you need a copy of the annual report or the proxy statement, the links are provided online as well. Instructions for voting and or changing a previously submitted vote are provided on the Computershare Meeting Center website. The following matters are presented for stockholder approval. First matter is the election of directors. I am pleased to report that all of the nominees have received sufficient votes to be elected to serve as directors until their successors are elected and qualified.
With respect to the advisory vote to approve executive compensation, I am pleased to announce that at least 10,450,000 shares have been voted to approve executive compensation. The 3rd matter presented for stockholder approval is the ratification of the Audit Committee's selection of PricewaterhouseCoopers LLP as the company's independent accountants for the next fiscal year. A representative of PricewaterhouseCoopers is in attendance and has been offered the opportunity to make a statement and can respond to appropriate questions. If any questions for the auditors are submitted prior to the adjournment of the meeting, a PricewaterhouseCoopers representative will respond. I am pleased to announce that at least 11,550,000 shares were voted in favor of ratification of the selection of PricewaterhouseCoopers LLP as the company's independent accountants for the current fiscal year.
Mr. McGritchie will now be invited to introduce the shareholder proposal for adoption of a resolution to urge the Board of Directors to adopt a policy to include non management employees as prospective director candidates. For the reasons outlined in the Board of Directors' statement in opposition to the shareholder proposal included in the proxy statement relating to this meeting, the Board has unanimously recommended against this shareholder proposal. Mr. McRitchie, you will now have 3 minutes to speak in support of the shareholder proposal.
Great. Has my line been unmuted?
Your line is unmuted, sir.
Okay. All right. Well, thank you. Proposal number 4 would increase the potential diversity of director nominees by considering non management employees, the initial pool of candidates. I want to be clear, I'm not an expert in how engaged employees are at WD-forty.
However, decades ago, I spent 2 years as a fellow with the National Institute For Mental Health studying what type of workplaces and what type of corporate governance was best both for productivity and for mental health. We found that although the evidence supports that ownership of the workplace as well as the work itself by the workers is both good for workers and companies, Businesses have been reluctant to move in that direction. It turns out that creating participatory structures runs contrary to the desires of most current decision makers whose status is derived from dominating their subordinates. Too little progress has been made at most companies to give real voice to workers beyond surveys and suggestion box. In reviewing the 150 companies in my portfolio, I thought WD-forty with its tribal culture might be among the most likely to embrace a more participatory workplace.
Experiments at 1 small innovative company might not only improve our situation at WD-forty, but might also set an example that could be replicated at larger companies. My proposal has to include non management employees in the pool of potential director candidates. Alternatively, the Board could form an advisory council of employees, appoint a director to be a liaison to the workforce or create a substantial employee stock ownership plan take any such action. But the Board is apparently satisfied with its current engagement efforts and has so far rejected any such measures. WD-forty is a good company.
Our current engagement efforts appear to be substantially better than average. However, they could be better still by increasing the ability of employees to speak directly with the Board. By voting for proposal number 4, you can send a message to the Board that increasing the voice of employees and their ability to speak to the Board is worth further consideration. Thank you very much.
Thank you very much, Mr. MacRitchie. Less than 300,000 shares have been voted for the shareholder proposal adopt the policy to include non management employees as prospective director candidates. As noted earlier, stockholders in attendance today's meeting may vote or change a previously submitted vote at any time prior to adjournment of the meeting.
Thank you for your votes in support of our good corporate governance. Following management's presentation, we'll answer questions from stockholders in attendance. Questions or comments may be submitted at any time during the virtual meeting by clicking on the message icon in the Computershare Meeting Center website. We will collate all appropriate questions for a response. Before we proceed, I'm going to ask Wendy to get us started on our business updates and provide our required notices.
Thanks, Wendy.
Thank you, Gary. Good morning and thanks to everyone for joining us today. I would like to ask our virtual audience to please turn your attention to the slides being webcast simultaneously through the Computershare Meeting Center website. As a reminder, today's call includes forward looking statements about our expectations for the company's future performance. Of course, actual results could differ materially.
The company's expectations, beliefs and projections are expressed in good faith, but there can be no assurance that they will be achieved or accomplished. Please refer to the risk factors detailed in our SEC filings for further discussion. On today's call, we'll discuss certain non GAAP measures. The descriptions and reconciliations of these non GAAP measures are available in our SEC filings as well as our earnings presentation. Finally, for anyone listening to a webcast replay or reviewing a written transcript of this call, please note that all information presented is current only as of today's date, December 8, 2020.
With that, I'd now like to turn the call back over to Gary, who will provide you with an overview of our growth aspirations.
Thank you, Wendy. I'd like to start off the meeting by sharing some thoughts with you about who are we at WD-forty Company. So what does a good business look like? To us, a simple and easy to understand business model, dominant in its industry, superior returns on capital, sustainable competitive advantage, significant cash flows, generation, strong balance sheet, growth opportunities and a proven management team. If we look at our brands, 90% of our revenue comes from the brands that wear either the blue and yellow can with a little red top logo and trade dress or the 3 in 1 brand.
10% of our revenues come from a small section of our home care and cleaning products, which were available in niche markets and geographies. So let's take a minute to look at our how and our why and our what. Our purpose. We exist to create positive lasting memories in everything we do. We solve problems, we make things work smoothly, and we create opportunities.
How we do that is, we create positive lasting memories by cultivating a tribal culture of learning and teaching, which produces a highly engaged workforce who live our company's values every day. Our mission or what we do is to deliver unique, high value and easy to use solutions for a wide variety of maintenance needs in workshops, factories and homes. We market and distribute our products across 62 trade channels in 176 countries around the world, so many people get to touch what we do. The values at WD-forty Company are the true foundation. Our values are hierarchical.
We value doing the right thing. We value creating positive lasting memories. We value making it better than it is today. We value succeeding as a tribe while excelling as individuals. We value owning it and acting on it and we value sustaining the WD-forty company economy.
One of the things we are most proud of is our tribe. And in these difficult times, the resilience of our tribe has been a key attribute to our continuing success. Today, most companies have employee engagement of around 90 around 33%. We've been measuring employee engagement for over 20 years. Our employee engagement number is 93%.
What I also love is the fact that 98 0.3% of our tribe globally say they love to tell people that they work at WD-forty Company, 98% are clear about our goals and interesting 97% of our people say they respect their coach. We don't have managers at WD-forty Company. We call ourselves coaches because our job is to help people succeed. I'm very excited that earlier this year, in fact, in October, we published our first ESG report. If you haven't seen it, the full report can be downloaded at www.wd40company.com/ourcompanycorporatesresponsibility.
It covers 3 key areas our tribe, our products, and our sourcing and supply chain. I invite you to look at it. We have growth aspirations. Our growth aspirations are based on a fairly solid history. And as you will see, over the last 10 years, we've had continual growth across our maintenance products.
Even during some of the hard times of COVID, we've seen growth in many of our markets. For us to attain these goals going forward, we have to have clear strategic objectives, which we have. We have strategic objectives of 1, growing WD-forty multi use product to $530,000,000 in revenue. We have an objective to grow WD-forty Specialist products to $100,000,000 in revenue. Our other brands have not only home care, but our bike range, we see it to grow to $70,000,000 of value.
Our 4th strategic objective is to attract, develop and retain outstanding tribe members to succeed as a tribe while excelling as individuals. I don't think I have seen another company that actually has a stated goal to grow employee engagement to 95%. And finally, operational excellence to operate within our disciplined business model of a gross margin of 55% or more, operating costs of around 30% and finally to reach an EBITDA goal of 25%. We have this aspiration to grow over time. Certainly, with COVID, we believe we've been put somewhat in a parking lot.
However, we still believe that our long term goal of $700,000,000 is very attainable. And once we're through this time of uncertainty, we will be back on track to move towards our long term goal. This morning, I was watching the first vaccine administered in the U. K. To me, it was a bit like watching the man land on the moon.
A new horizon is in front of us. We're closer to the end of this than we are to the beginning and we're excited about us being able to get back to a new some sort of normal life as we travel down this path. For us to win in these areas, we must have must win battles. And I'm now pleased to pass over to Steve Brass, our President and Chief Operating Officer to share with you some of the details of our must win battles.
Thank you, Gary, and good morning. In order to deliver against our revenue expectations, we're laser focused on delivering what we call our global must win battles, of which we have 4. Our largest growth opportunity in number 1 first must win battle is a geographic expansion of the blue and yellow can with a little red top. We estimate the global market for WD-forty multi use product to be over $1,000,000,000 We're laser focused on delivering long term growth in our top 20 focused growth markets around the world. China remains our number one growth opportunity long term, and we see China becoming our number 2 market globally in the medium term.
India too represents a substantial long term growth opportunity. And 2 years ago, we initiated our Indian step up program, which has already delivered impressive results. Substantial growth opportunities remain elsewhere in our EMEA segment with our largest growth opportunities being Russia and Turkey as well as the direct markets of Germany, Italy and Spain. Africa is one of the last frontiers for the WD-forty brand globally and we've started to deliver impressive growth in recent years. In Latin America, we transformed Mexico into a direct operation in May of this year, and we are set for very strong growth in Mexico over the coming years as well as in the broader Latin American market.
Asia Pacific, too, has significant growth opportunities with focused markets being Indonesia, South Korea, Malaysia and Thailand. Our second must win battle is premiumization of WD-forty multi use product. WD-forty Smart Straw, a delivery system innovation that permanently attaches a red straw to the can, has been our most successful ever innovation and is loved by end users who are prepared to pay a significant premium for it over classic can. Easy Reach is a more recent delivery system innovation that comes with a patented flexible straw that enables users to reach hard to reach places easily. We are in the process of upgrading Smart Straw to our Smart Straw next generation format, which delivers an even better quality product at lower cost and removes current capacity constraints.
We expect to leverage these premiumization strategies to drive Smart Straw to 60% of our global W-forty multiuse product revenues over the coming years and deliver $50,000,000 in incremental premiumization revenue. Our 3rd must win battle is to grow WD-forty Specialist. We debited the global rebrand of WD-forty Specialist in fiscal year 2020. Now for the first time ever, WD-forty Specialist is fully leveraging our most iconic asset, the blue and yellow cam with a little red top. The WD-forty Specialist range aims to provide specialist solutions to complement our iconic multi use product and make the WD-forty brand more relevant to more people in more places for more uses.
Sales have grown to $37,000,000 since launch and following the rebrand, we expect to see sales accelerate faster in the years ahead toward the $100,000,000 goal that Gary mentioned. Our final must win battle is digital commerce. 2.5 years ago, Gary set out our global digital ambition, which is to engage with end users at scale, becoming global leaders in our category by dominating the digital platforms they use and making it easy to access, learn about and purchase our brands online. Over the past few years, we've developed an impressive digital capability as a business and delivered very strong growth globally in e commerce, which has been by far our fastest growing channel, achieving global growth of 80% in our financial year 2019 and 58% in our fiscal 2020. With e commerce set to deliver over half of global retail growth by 2025 and digital interactions playing an increasingly important role in purchase journeys, we are well positioned to benefit from the significant shift to online behaviors in the years ahead.
We certainly see digital and e commerce as a strong accelerator of our future growth. With that, I'll hand over to our CFO, Jay Remmel.
Thank you, Steve. Let's first begin with a discussion of our fifty fivethirtytwenty five business model. This plays a very important role at our company and it helps us focus on the few simple metrics that we see as key to our success. It starts with the 55%, which represents gross margin. We target our gross margin to be at 55% or above.
Next is the 30%, which represents our cost of doing business. This is made up of all the other operating costs except depreciation and amortization. Our goal is to drive our cost of doing business over time towards 30% of net sales. And that leaves us with the 25%, which represents EBITDA. If we are able to keep our gross margin above 55% and continue to reduce our cost of doing business towards 30%, we'll be able to achieve a gross margin or excuse me, an EBITDA margin of about 25%.
This next slide shows our progress over the last 3 years. You may note that while on a quarterly basis, we've had fluctuations over this time, on an annual basis, our metrics have remained fairly consistent. As we look forward, we see improvements to our metrics that will allow us to get closer to the 25% EBITDA target. With our premiumization must win battle that Steve just shared, we expect to see our gross margin above its current level. Not only do we achieve higher sales price for our premium offerings, but they also contribute a higher gross margin percentage.
Along with the improvement in gross margin, our cost of doing business will likely improve as we leverage our infrastructure. We expect to move closer to the 30% over time as revenues grow. Now let's turn to our capital allocation. This slide describes our approach to capital allocation. And generally, we review targets for growth along with those for our liquidity, cash and debt.
We then look to our maintenance CapEx needs and our dividend payments. Any excess is then allocated to alternatives with the highest return. While we have listed share repurchases as an alternative, it is important to note that we suspended share repurchases in April in response to the COVID-nineteen health crisis as we took measures to conserve cash and increase liquidity. Our capital allocation strategies works to both balance investing in the long term growth, while providing strong returns to our shareholders. This slide shows our historical cash returns to shareholders, which has included regular dividends and share repurchases.
The top section tracks our fiscal year dividend payments over the last 5 years and also shows our dividend payout ratio. We target the dividend payout ratio to be near 50%. The company has a history stretching back over 40 years of paying dividends without interruption. The bottom section of the slide shows the amount of share repurchases we've made over that same period. Last year, we were on pace with our historical share repurchase levels of between $20,000,000,000 $35,000,000,000 when we suspended our share repurchases under the plan.
Note that while the plan has expired the plan has expired at the end of August 2020. We have not yet replaced the plan and we'll wait on doing so until we have a clearer view of the future. Now I'll turn the presentation back to Gary for some final thoughts. Thank you, Jay.
Just to sum up, I'd like to talk about where we see our focus needs to be. We need to continue to live our values and enrich our tribal culture. We need to continue to have high levels of employee engagement. We need to ensure a steady growth of WD-forty multi use product across all markets. We need to continue to grow our specialist product line.
Innovation and premiumization is a key part of our to support our growth. A continued commitment to raising our digital IQ, focusing on our gross margin at 55% or higher, and managing our investments and on our cost of doing business to bring our cost of doing business towards our 30% goal and to protect the power of the shield and to mitigate any regulatory impacts. Now with every business comes risks. And if we didn't identify our risks, we wouldn't have focus upon them. So what are our biggest risks right now?
Global volatility, uncertainty, complexity and ambiguity. There was no way we could have predicted 2020 the way it's turned out. Again, I am so grateful for the resilience of our tribe who have carried us through these challenging times. We must make sure that we continue to live our values and enrich our tribal culture. We cannot lose focus.
We must not execute against our strategic drivers that do not focus on our must win battles. We have to watch out for complexity, operating our business that sells in 176 countries in 62 trade journals. We want to make sure we don't misalign compensation. We may not we must not move away from our pay for performance philosophy. We have to be deliberate and focused and we must make sure that we don't deviate away from best in class products that generate positive lasting memories for our end users.
We must resist the temptation to diversify, which we identify as bad capital allocation. We must make sure that we develop products that meet the support base that we have in our business model now and we've got to be very clear about who our targeted end users are. So, Wendy has been monitoring the online questions that have been submitted. We'd be now pleased, Wendy, to answer any questions from our virtual shareholders at this time. Thank you, Wendy.
Thanks, Gary. Our first question comes from Mr. Wesley Whitehead. Mr. Whitehead would like to know, would it be possible to make the straw on our easy reach product can spread?
Thank you, Mr. Whitehead. It certainly would be possible, but it certainly isn't practical. The EZ Reach Straw is a woven wire straw process, which is woven to ensure functionality at the same time being coded to be used to be able to ensure that our product is delivered in the way that we expect it to be delivered. WD-forty MAP and the products that are with that we put in EZ Reach are meant to creep.
So we have a coating on that straw and unfortunately it can't be read. So it would be possible, but unfortunately it's not practical.
Thanks, Gary. Our next question comes from Mr. Whitehead as well. He'd like to know, has a representative of WD-forty Company indicated to Computershare that the flaws in their virtual platform should be fixed, so that owners who hold their shares in street names can attend the meeting as an owner without having to deal with all the necessary difficulties. A proxy voting form should be sufficient to demonstrate partial ownership of the company?
Thanks for this question. We're really sorry that the steps required to obtain a legal proxy can be inconvenient. Our stock transfer agent Computershare has to maintain proper control of voting rights to assure that votes aren't counted twice. Computershare has no record of share ownership for shares held in street name or by brokers, and it's really just unfortunate that it can be difficult to obtain a required legal proxy for the from some of the brokers.
Thanks, Rich. We have no further questions from the virtual audience. Back to you, Gary.
Thank you, Wendy. That concludes WD-forty Company's 2020 Annual Meeting of Stockholders. I would like to thank all our stockholders for their continued support. We'd also like to thank our webcast audience for joining us for today's virtual meeting. The meeting is now adjourned.
Ladies and gentlemen, this concludes the meeting. You may now disconnect and have a pleasant day.