Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Investor Presentation (March 2014)
31 slides from Australian Foundation Investment's investor presentation, Mar 11, 2014
Slide 1: ASX cover letter: Information Meetings – Presentation
For personal use only 11 March 2014 The Manager ASX Market Announcements Australian Securities Exchange Exchange Centre Level 4 20 Bridge Street Sydney NSW 2000 Electronic Lodgement Australian Foundation Investment Company Limited Information Meetings – Presentation Dear Sir / Madam Please find atta
Slide 2: Shareholder Meeting March 2014
For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 3: Disclaimer
DISCLAIMER For personal use only Australian Foundation Investment Company Limited and its subsidiary AICS (AFSL 303209), their related entities and each of their respective directors, officers and agents (together the Disclosers) have prepared the information contained in these materials in good fai
Slide 4: 1. The Market
For personal use only 1. THE MARKET SHAREHOLDER MEETING MARCH 2014
Slide 5: The Australian market has matched the strong performance of the US over the year
THE AUSTRALIAN MARKET HAS MATCHED THE STRONG PERFORMANCE OF THE US OVER THE YEAR For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 6: Resources have driven a large part of this gain
RESOURCES HAVE DRIVEN A LARGE PART OF THIS GAIN For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 7: The S&P/ASX index has responded positively to recent reporting season
THE S&P/ASX 200 INDEX HAS RESPONDED POSITIVELY TO RECENT REPORTING SEASON For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 8: Recent reporting season feedback from companies
RECENT REPORTING SEASON FEEDBACK FROM COMPANIES For personal use only • Cost efficiency generally driving earnings improvement • Top line revenue growth remains challenging • Company balance sheets are strong • Overall earnings and dividends better than first expected • Business conditions are mixed
Slide 9: 2. Half Year Results & Shareholder Returns
For personal use only 2. HALF YEAR RESULTS & SHAREHOLDER RETURNS SHAREHOLDER MEETING MARCH 2014
Slide 10: Half year in summary
HALF YEAR IN SUMMARY For personal use only Dec 2013 Reported profit ($m) 137.0 Up 3.7% Net operating result ($m) 137.0 Up 10.8% Dividend per share (cents) 8.0 No change Total portfolio ($bn) 6.3 Last year 5.4 MER (%) 0.18 Last year 0.20 SHAREHOLDER MEETING MARCH 2014
Slide 11: Earnings per share vs dividends
EARNINGS PER SHARE VS DIVIDENDS For personal use only Note: Earnings per share figure is based on net operating result per share. SHAREHOLDER MEETING MARCH 2014
Slide 12: Share price performance – per annum return to January
SHARE PRICE PERFORMANCE – PER ANNUM RETURN TO 31 JANUARY 2014 For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 13: Share price is trading at a premium
SHARE PRICE IS TRADING AT A PREMIUM For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 14: 3. Portfolio Highlights
For personal use only 3. PORTFOLIO HIGHLIGHTS SHAREHOLDER MEETING MARCH 2014
Slide 15: Portfolio performance – per annum return
PORTFOLIO PERFORMANCE – PER ANNUM RETURN TO 31 JANUARY 2014 For personal use only After tax and expenses. Ignores benefits of franking and LIC tax credits. SHAREHOLDER MEETING MARCH 2014
Slide 16: Franking provides an important addition to returns
FRANKING PROVIDES AN IMPORTANT ADDITION TO RETURNS – PER ANNUM RETURN TO 31 JANUARY 2014 For personal use only Assumes an investor can take full advantage of the franking credits. SHAREHOLDER MEETING MARCH 2014
Slide 17: Top holdings – Banks
Top 25 at 31 JANUARY 2014 – BANKS For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 18: Top holdings – Resources
Top 25 at 31 JANUARY 2014 – RESOURCES For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 19: Top holdings – Mining Services
Top 25 at 31 JANUARY 2014 – MINING SERVICES For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 20: Top holdings – Energy
Top 25 at 31 JANUARY 2014 – ENERGY For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 21: Top holdings – Industrial
Top 25 at 31 JANUARY 2014 – INDUSTRIAL For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 22: Top holdings – Retail
Top 25 at 31 JANUARY 2014 – RETAIL For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 23: Top holdings – Infrastructure
Top 25 at 31 JANUARY 2014 – INFRASTRUCTURE For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 24: Top holdings – Non Bank Financial Services
Top 25 at 31 JANUARY 2014 – NON BANK FINANCIAL SERVICES For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 25: Top holdings – Healthcare
Top 25 at 31 JANUARY 2014 – HEALTHCARE For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 26: Recent purchase - Auckland International Airport
RECENT PURCHASE - AUCKLAND INTERNATIONAL AIRPORT For personal use only • Largest and busiest airport in New Zealand • Operates retail, commercial and industrial properties • Tapping into growing passenger numbers to New Zealand • Conservative balance sheet • Owns a large land bank surrounding the ai
Slide 27: Allocation of funds to buy and write strategies - currently less than 5%
ALLOCATION OF FUNDS TO BUY AND WRITE STRATEGIES - CURRENTLY LESS THAN 5% For personal use only • Buying stock and writing call options to enhance income returns • Different accounting treatment to the trading portfolio • Currently a small portfolio but nevertheless useful supplement to income • Main
Slide 28: 4. Looking Ahead
For personal use only 4. LOOKING AHEAD SHAREHOLDER MEETING MARCH 2014
Slide 29: Outlook
OUTLOOK For personal use only • The Australian economy facing a number of challenges: - post mining investment boom - government needs to live within its means - need to create new jobs and foster new industries • Some economic light in US and European markets • Australian market appears fully value
Slide 30: Putting the year into perspective: All Ordinaries price index long term performance
PUTTING THE YEAR INTO PERSPECTIVE ALL ORDINARIES PRICE INDEX – LONG TERM PERFORMANCE For personal use only SHAREHOLDER MEETING MARCH 2014
Slide 31: Australian Foundation Investment Company
AUSTRALIAN FOUNDATION INVESTMENT COMPANY
Australian Foundation Investment Company — Investor Presentation (March 2014) on 6ix