It is now my pleasure to turn today's meeting over to Mr. Steve Brass, President and Chief Executive Officer of WD-40 Company. Mr. Brass, the floor is yours.
Good morning and welcome to WD-40 Company's 2024 annual meeting of stockholders. I'm Steve Brass, WD-40 Company's President and CEO, and I will preside at today's meeting. I'm very happy to welcome you to this year's annual meeting of stockholders. Before calling the meeting to order, I'd like to introduce today's meeting participants.
The following directors are in virtual attendance today: Cynthia Burks, served most recently as Chief People and Culture Officer of Genentech, Inc. Daniel Carter, served as Executive Vice President and Chief Financial Officer of BevMo! Inc. Dan is the Chair of our Audit Committee. Eric Etchart, served as Senior Vice President of the Manitowoc Company, Inc. Eric is the Chair of our Corporate Governance Committee. Lara Lee served as President of Orchard Supply Hardware. Edward Magee currently serves as Vice President of Strategic Operations for Belmont University. Trevor Mihalik is Executive Vice President and Group President at Sempra.
Trevor is the Chair of our Finance Committee. Graciela Monteagudo served as President and CEO of Lala U.S., Inc. David Pendarvis served as Chief Administrative Officer, Global General Counsel, and Secretary of ResMed Inc. Anne Saunders served as President of U.S. NakedWines.com. Anne is the Chair of our Compensation Committee. Greg Sandfort served as CEO of Tractor Supply Company. Greg is the outgoing Chairman of our board. On behalf of the company, we extend our deepest gratitude to Greg for his exceptional leadership, insight, and unwavering commitment to sound corporate governance, which have been instrumental in guiding the company over the last decade. Also participating on our call today are Phenix Kiamilev, our General Counsel and Corporate Secretary; Sara Hyzer, our Chief Financial Officer; and Wendy Kelley, our Vice President of Stockholder and Investor Engagement. I would also like to introduce Jessica Allen from PricewaterhouseCoopers, the company's auditors.
She will be available to answer questions during the question-and-answer session of the meeting. Ms. Kiamilev will act as Secretary of the meeting. We will now officially start the meeting by confirming that proper notice of the meeting has been given and that we have a quorum.
Thank you. I've been informed by the Inspector of Election that there are present, in person, or by proxy, stockholders entitled to vote holding at least a majority of outstanding shares of common stock on the record date, November 1st, 2024. Accordingly, a quorum is present and the meeting is duly convened for purposes of transacting such business as may properly come before it.
Thank you. I now call this meeting to order. Following the Secretary's introduction of the matters to be acted upon by stockholder vote at this meeting, Sara and I will share a strategic business update. Then we will take questions from the online audience and thereafter the formal meeting of stockholders will adjourn.
There are three matters for stockholder consideration and voting at today's meeting: the election of directors, an advisory vote to approve executive compensation, and the ratification of the selection of our independent auditors. Stockholders have been encouraged to vote in advance of the meeting. However, if you've 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 at 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 in the online meeting center. Instructions for voting and/or changing a previously submitted vote are provided on the Computershare meeting center website as well. The following matters are presented for stockholder approval. The first matter is the election of directors.
I'm 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'm pleased to announce that at least 9,671,723 shares have been voted to approve executive compensation. The third matter presented for stockholder approval is the ratification of the audit committee selection of PricewaterhouseCoopers LLP as the company's independent accountants for fiscal year 2025. 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 adjournment of the meeting, a PricewaterhouseCoopers representative will respond.
I'm pleased to announce that at least 9,874,978 shares were voted in favor of ratification of the selection of PricewaterhouseCoopers as the company's independent accountants for the current fiscal year. A current report on Form 8-K will be filed with the SEC within four business days reporting the final results of the voting at today's meeting, a copy of which will be available on the company's website.
I'd like to thank all of our stockholders for their continued support. We will now share an update with you on the company and where it's headed in the future. Following management's presentation, we will answer questions from stockholders in attendance. Questions or comments may be submitted at any time during the virtual meeting by clicking on the Q&A message icon on the right-hand side of 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 update and provide our required notices.
Thank you, Steve. 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. Next slide, please. 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 will 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 presentations.
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 12th, 2024. With that, I'd now like to turn the call back over to Steve.
Thank you, Wendy. The theme of our presentation today is Unlocking Value. As I look around the world today, all I see is growth opportunity for our iconic WD-40 brand. Leadership's task is to unlock that opportunity to create substantial value for stockholders by accelerating our global expansion. With our 4x4 framework, we have a really simple strategy: four Must-Win Battles to drive faster global revenue growth and four strategic enablers that support execution and drive operational excellence. Today, we will talk to all of our Must-Win Battles and strategic enablers, but with particular focus on our largest growth opportunity, geographic expansion of our Multi-Use Product. We will also give investors an update on progress made on gross margin and how we expect to drive operational efficiencies as we increasingly leverage global synergies going forward.
It is quite amazing to me that at 71 years young, the growth opportunity for WD-40 Multi-Use Product around the world remains so significant. To generate that growth opportunity, we use our own internal benchmark algorithm, which uses the USA as our benchmark market and illustrates the market potential around the world based upon purchasing power parity and adjusted GDP. The algorithm represents a long-term view of our growth opportunity and should be taken by investors as directional long-term potential. We have several other key markets that are approaching the benchmark level set by the USA, which gives us confidence in the benchmark. Basing our benchmark on the USA means the USA is excluded from the above growth opportunity. In reality, of course, we've continued to grow the USA with a past five-year compound annual growth rate on maintenance brand sales of 6.8%.
Indeed, the USA in dollar growth terms has been the fastest growing market for us in dollar growth terms, with revenue growth on maintenance product sales of $55 million over the past five years. The USA at 35% of global sales of Multi-Use Product gives us an extremely strong foundation to grow from internationally. Investors are likely already familiar with this slide showing the relative size of the growth opportunities we have around the world on our core product based upon our growth algorithm. The relative size of the bubble represents the size of the growth opportunity. At the very least, this analysis shows us where to allocate time, talent, and treasure in order to drive the fastest growth.
In the new emerging multipolar world we live in, we don't believe in putting all our eggs in one geographic basket, rather in a focused diversification strategy prioritizing the top 20 opportunities we highlight above. In recent years, we've taken several steps to accelerate growth in many of these high-potential markets, and I would like next to talk about progress made in several key markets for the future. I'd like to start with Mexico, detailed on the right of your screen. In 2020, we took the Mexico market direct, and since doing so, we've virtually quadrupled our Mexico business from $6.8 million to $25.5 million in FY 2024, and we're not done as we see Mexico as a $30 million-$40 million market over the coming years. Our success in Mexico gave us confidence to convert Brazil to a direct market in March of this year.
So far, we are extremely pleased with progress made in Brazil. In FY 2024, we grew Brazil by $7 million and expect a further $7 million-$9 million of growth in FY 2025. We expect Brazil to be a $20+ million market within three to five years and ultimately to grow to the same kind of size as Mexico over the coming years. Moving to the left of our screen, China has consistently delivered strong growth in recent years. We've been direct in China since 2006 with our highly capable team of approximately 60 and our simple but effective strategy of expanding distribution while sampling 20,000-plus industrial factories each and every year continues to deliver strong results despite a somewhat weaker economy. India is one of, if not the, most attractive growth markets in the world right now.
Since entering into our strategic partnership with our local partner, Pidilite, five years or so ago, we have more than doubled our sales in India. India is now our second-largest market in terms of unit sales after the USA, and we see huge potential for further growth ahead. Indonesia is another very fast-growing market for us with a compound annual growth rate of over 7% over the past five years. Indonesia is now one of our largest marketing distributor markets. Indonesia is a hybrid market for us, but we have both an outstanding local partner but also a small team in market, a formula that has really accelerated growth. In our fiscal year 2024, this increased focus on our key growth markets around the world yielded an impressive 10% growth for WD-40 Multi-Use Product. Our second revenue battle is to accelerate sales of premium formats of our Multi-Use Product.
In FY 2024, sales of our Smart Straw and EZ-Reach formats combined increased by 11% or approximately $20 million over prior year. We have consistently delivered strong growth in our premium formats with a five-year compound annual growth rate of 11%. Our expectations going forward are to continue to deliver double-digit growth of 10% plus on premium formats. Our premium formats delight our end users but also help us to drive margin expansion. With premium format sales representing approximately 40% of global unit sales on our core product, there is significant upside for growth, especially in Asia-Pacific and within our distributor markets. Through our WD-40 Specialist line, we aspire to achieve category leadership and increase our market share by leveraging our core brand equity. For fiscal year 2024, sales of WD-40 Specialist were up 11% or $7 million to $74 million.
Over the past five years, WD-40 Specialist has been our fastest-growing brand with a five-year compound annual growth rate of 14%. We target growth of 15%+ on a go-forward basis. We are only just really getting going on WD-40 Specialist. We deploy a similar growth benchmark algorithm on WD-40 Specialist, leveraging our success in Australia as our benchmark. Our Australian team have set the benchmark on what is possible on WD-40 Specialist with sales to our core Multi-Use Product of 38%. Our benchmark assumes all markets operating at that 38% Multi-Use Product sales level and generates a market potential on the WD-40 Specialist range of $605 million as compared to our FY 2024 sales of $74 million. We now have several key markets that are approaching similar penetration levels to Australia, which once again gives us confidence in the validity of this long-term potential for the battle.
We view digital commerce as the accelerator for all our other Must-Win Battles. Our digital commerce strategy is not just about driving online sales. It's about building our brand in the digital space and accelerating all our other Must-Win Battles. For fiscal year 2024, global sales within the pure-play e-commerce channel grew 12% over the prior year. A highlight of our digital efforts this year was the expansion of our global online marketing campaign, The Repair Challenge. This initiative, which now spans over 40 countries, exemplifies how we can leverage digital tools to build our brand globally while promoting sustainability. So what does that mean for our future growth ambitions? Going forward, we expect to build on our historic consistent delivery of growth on our focused maintenance products, which have delivered growth at constant currency over the past 10 years of 6.4%.
As we seek to divest most of our household brands and focus in even more on our significant organic growth opportunities around the world, we will target growth in the mid to high single digits. We're very clear where that growth will come from, with growth expected from our Americas division of 5%-8%, 8%-11% in our EMEA segment, and 10%-13% in Asia-Pacific. Of course, the real key to unlocking value is by taking care of our people. At WD-40 Company, we've long held the belief that first you build the people, then the people build the business. Our greatest asset is our 644 employees spread across 16 countries. We strive to be an employer of choice where all employees bring their best selves to work. In fiscal year 2024, we conducted our first biannual employee engagement survey since new leadership assumed their positions.
I'm very proud of our 93% engagement score, a testament to our strong culture and the opportunities we provide to our people to learn, grow, and succeed. Our success is accelerated through global collaboration and our bold ambition to become a true world-class global learning organization. I'm equally proud that we've now gone public with our sustainability targets after a very in-depth process putting together our science-based roadmap for achieving carbon reduction. Many of our global employees are passionate about pivoting our organization to a more sustainable future, and I strongly believe that setting external targets will galvanize the organization to make significant progress now in future-proofing the organization.
With that, I'll now hand over to Sara Hyzer, our CFO, to address how we intend to drive operational efficiencies in our business, as well as to address progress made on gross margin as well as other financial aspects of the business.
Thank you, Steve. Today, I will start with strategic enabler number three, Achieve Operational Excellence in Supply Chain. Through this enabler, we continue to pursue operational excellence, and this year, we adopted a truly global approach for our supply chain strategy for the first time. We've undertaken several key initiatives that support this approach, and an in-depth analysis revealed significant opportunities for cost reduction and efficiency gains. By strengthening global partnerships with key suppliers, we've driven efficiencies that translate into cost savings. Notably, we reduced our inventory by approximately $7 million and maintain an average on-time in full delivery rate of 95% for fiscal year 2024.
The cost of our can is impacted by various input costs from petroleum-based specialty chemicals and tin plate, both of which are subject to commodity price variability. In addition, with a fully outsourced model, we work with third-party manufacturers to build our cans all over the world. We have made significant strides in our gross margin recovery, achieving an increase of 240 basis points compared to the previous year. This improvement is largely attributed to our strategic focus on selling more products in higher margin regions and prioritizing the sale of higher margin premium products. We also saw a decrease in costs for our specialty chemicals compared to last year. Additionally, by reducing our inventory levels, we managed to lower our distribution and warehousing costs. We have numerous initiatives in our supply chain pipeline aimed at driving further efficiencies.
However, I am particularly pleased to report a 430 basis point gross margin improvement over the past two years. And finally, strategic enabler number four is to drive productivity via enhanced systems. We've been laser-focused on identifying and implementing systems that streamline operations, deliver actionable insights, and drive value. By leveraging automation and AI, we aim to optimize our processes, reduce manual labor, and ultimately enhance our bottom line. A key milestone this year was the successful rollout of our new ERP system across 50% of our business. While we encountered some initial challenges, we've swiftly adapted and learned from the experience, which we expect will result in smoother implementations moving forward. This has led us to leverage WD-40 Company's long-standing strengths. Focus.
Few things, many places to drive bigger impact has historically been an approach central to our product strategy, and we continue to embrace it as we plan to divest our household brands in the Americas and the United Kingdom. We are now extending this mantra to our systems and processes, striving for greater global collaboration to enhance operational efficiencies. We are focused on standardization in processes like project and portfolio management, along with streamlined approaches to solution-driven decision-making. Lastly, we've established the foundation to move with more intent toward productivity improvement by establishing global centers of excellence along key areas of IT to bring once-disparate teams together to harness their collective skills and capacity to focus on our long-term growth objectives, and now a brief overview of the fiscal year 2024 financial performance.
These results highlight the company's strong financial performance, with significant growth in net sales, improved gross margins, and increased profitability. We experienced game-changing growth of 10% executing on our Brazil distributor acquisition, along with strong execution against our 4x4 strategy. As I mentioned previously, we saw strong gross margin recovery, which drove growth in our operating income of 7% over the prior year. The positive trends in operating income and net income further underscore the company's robust financial health and its ability to deliver value to stockholders. Turning to our capital allocation strategy, we begin by reviewing our overall growth targets, aiming for both revenue and earnings growth in the mid to high single digits. Following this, we assess our maintenance capital expenditure needs, which typically require only 1%-2% of net sales per fiscal year.
We then allocate funds for dividend payments, targeting distributions of more than 50% of earnings. Any remaining capital is directed towards the highest return alternatives. Our strategy is designed to balance long-term growth investments while delivering strong returns to our stockholders, with a target return on invested capital exceeding 25%. Our historical cash returns to stockholders have included regular dividends and share repurchases. At the top of this slide, you will see a history of our dividend payments over the last five years, including the dividend payout ratio for each of those years. The company has a long history stretching back over 40 years of paying dividends without interruption. We remain committed to returning capital to stockholders through regular dividends, and yesterday, we announced that our Board of Directors elected once again to increase our dividend.
At the bottom of this slide, you will see the amount of share repurchases we have completed over the same period. We have focused on using our cash in the most accretive manner, and over the past few years, we have opted to pay off much of our higher interest-rate short-term debt in lieu of buybacks. We have been and will continue to be active in the market, and we expect to repurchase at least enough shares to offset those issued for equity compensation. WD-40 Company delivers unique, high-value, and easy-to-use solutions for a wide variety of maintenance needs in workshops, factories, and homes. Our iconic brand and category leadership provide a solid foundation for resilient and sustainable profitable growth. Additionally, the company generates significant cash flow, follows an asset-light strategy, and maintains a strong balance sheet, which maximizes stockholder returns.
With our highly engaged culture and deep organizational talent, we are well-positioned to capitalize on significant growth opportunities. We believe WD-40 Company represents a compelling investment opportunity. With that, I now pass it back to Steve Brass.
Thank you, Sara. WD-40 has been monitoring the online questions being submitted. We would now be pleased to answer any questions from our virtual audience at this time.
Thank you, Steve. We have no questions from the virtual audience. Back to you.
Thank you, Wendy. This concludes WD-40 Company's 2024 annual meeting of stockholders. I'd like to thank everyone for their participation. The meeting is now adjourned.
Ladies and gentlemen, this does conclude the meeting. Thank you for your participation, and you may now disconnect.