Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Shareholder Meeting (October 2013)
34 slides from Australian Foundation Investment's shareholder meeting presentation, Oct 9, 2013
Slide 1: 2013 AGM Presentation ASX lodgement
For personal use only 9 October 2013 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 2013 AGM Presentation Dear Sir / Madam Please find attached a presen
Slide 2: Annual General Meeting 2013
For personal use only ANNUAL GENERAL MEETING 2013
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 Over the Year
For personal use only 1. THE MARKET OVER THE YEAR ANNUAL GENERAL MEETING 2013
Slide 5: The S&P/ASX Index Has Rebounded Strongly Over the Year
THE S&P/ASX 200 INDEX HAS REBOUNDED STRONGLY OVER THE YEAR For personal use only ANNUAL GENERAL MEETING 2013
Slide 6: Change in Relative Returns: Yield on Australian Shares Versus Bank Deposits
A LARGE FACTOR HAS BEEN THE CHANGE IN RELATIVE RETURNS – YIELD ON AUSTRALIAN SHARES VERSUS BANK DEPOSITS For personal use only Source: RBA, IRESS. ANNUAL GENERAL MEETING 2013
Slide 7: Other Key Trends for the Year
OTHER KEY TRENDS FOR THE YEAR For personal use only ANNUAL GENERAL MEETING 2013
Slide 8: Putting the Year into Perspective: All Ordinaries Long Term Performance
PUTTING THE YEAR INTO PERSPECTIVE ALL ORDINARIES PRICE INDEX – LONG TERM PERFORMANCE For personal use only ANNUAL GENERAL MEETING 2013
Slide 9: 2. Results & Shareholder Returns
For personal use only 2. RESULTS & SHAREHOLDER RETURNS ANNUAL GENERAL MEETING 2013
Slide 10: Year in Summary
YEAR IN SUMMARY For personal use only June 2013 Reported profit ($m) 242.8 10.4% Net operating result ($m) 234.3 14.4% Dividend per share (cents) 22.0 + 1 cent Total portfolio ($bn) 5.7 Last year 4.7 MER (%) 0.18 Last year 0.19 Number of holdings 73 No change ANNUAL GENERAL MEETING 2013
Slide 11: AFIC Dividends vs Dividends for the S&P/ASX Index
AFIC DIVIDENDS VS DIVIDENDS FOR THE S&P/ASX 200 INDEX For personal use only ANNUAL GENERAL MEETING 2013
Slide 12: Share Price Performance to June 2013 - Per Annum Return
SHARE PRICE PERFORMANCE TO 30 SEPTEMBER 2013 – PER ANNUM RETURN For personal use only After tax and expenses. Ignores benefits of franking and LIC tax credits. ANNUAL GENERAL MEETING 2013
Slide 13: Share Price Is Trading at a Premium
SHARE PRICE IS TRADING AT A PREMIUM For personal use only ANNUAL GENERAL MEETING 2013
Slide 14: 3. Portfolio Highlights
For personal use only 3. PORTFOLIO HIGHLIGHTS ANNUAL GENERAL MEETING 2013
Slide 15: Portfolio Performance - Per Annum Return
PORTFOLIO PERFORMANCE – PER ANNUM RETURN TO 30 SEPTEMBER 2013 For personal use only After tax and expenses. Ignores benefits of franking and LIC tax credits. ANNUAL GENERAL MEETING 2013
Slide 16: Franking Provides an Important Addition to Returns
FRANKING PROVIDES AN IMPORTANT ADDITION TO RETURNS – PER ANNUM RETURN TO 30 SEPTEMBER 2013 For personal use only Assumes an investor can take full advantage of the franking credits. ANNUAL GENERAL MEETING 2013
Slide 17: Recent Purchases
RECENT PURCHASES For personal use only ANNUAL GENERAL MEETING 2013
Slide 18: Recent Disposals
RECENT DISPOSALS For personal use only Australian GUD Holdings Bradken Infrastructure Fund CFS Retail Property Trust Fleetwood Corporation ANNUAL GENERAL MEETING 2013
Slide 19: Top Holdings - Banks
TOP 25 AT 30 SEPTEMBER 2013 – BANKS For personal use only ANNUAL GENERAL MEETING 2013
Slide 20: Top Holdings - Resources
TOP 25 AT 30 SEPTEMBER 2013 – RESOURCES For personal use only ANNUAL GENERAL MEETING 2013
Slide 21: Top Holdings - Energy
TOP 25 AT 30 SEPTEMBER 2013 – ENERGY For personal use only ANNUAL GENERAL MEETING 2013
Slide 22: Top Holdings - Industrial
TOP 25 AT 30 SEPTEMBER 2013 – INDUSTRIAL For personal use only ANNUAL GENERAL MEETING 2013
Slide 23: Top Holdings - Mining Services
TOP 25 AT 30 SEPTEMBER 2013 – MINING SERVICES For personal use only ANNUAL GENERAL MEETING 2013
Slide 24: Top Holdings - Retail
TOP 25 AT 30 SEPTEMBER 2013 – RETAIL For personal use only ANNUAL GENERAL MEETING 2013
Slide 25: Top Holdings - Non Bank Financial Services
TOP 25 AT 30 SEPTEMBER 2013 – NON BANK FINANCIAL SERVICES For personal use only ANNUAL GENERAL MEETING 2013
Slide 26: Top Holdings - Infrastructure
TOP 25 AT 30 SEPTEMBER 2013 – INFRASTRUCTURE For personal use only ANNUAL GENERAL MEETING 2013
Slide 27: Top Holdings - Healthcare
TOP 25 AT 30 SEPTEMBER 2013 – HEALTHCARE For personal use only ANNUAL GENERAL MEETING 2013
Slide 28: 4. Looking Ahead
For personal use only 4. LOOKING AHEAD ANNUAL GENERAL MEETING 2013
Slide 29: Recent Reporting Season Feedback from Companies
RECENT REPORTING SEASON FEEDBACK FROM COMPANIES For personal use only • Companies in good shape – sound balance sheets • Revenue growth is challenging • Focus on cost reductions/ efficiencies • Change in government likely to be positive for business over the medium term • Concerns remain around oper
Slide 30: Recent Reporting Season Feedback from Companies (cont.)
RECENT REPORTING SEASON FEEDBACK FROM COMPANIES CON’T. For personal use only • Mining services sector environment is tough • Consumers still have conservative setting • Outlook is for positive earnings growth ANNUAL GENERAL MEETING 2013
Slide 31: Outlook
OUTLOOK For personal use only • The Australian economy still adjusting to changing mix of growth • Falling $A and interest rates will provide some support • Developed markets showing improvement in growth • Long term structural issues in Australia need to be addressed • Eventual removal of global in
Slide 32: Observations
OBSERVATIONS For personal use only • Corporate memory is a valuable asset that many companies ignore • Government levies are being used to undermine the franking system • Long term productivity improvement is required • Australia needs to encourage overseas investment • Looking to the new government
Slide 33: Board Succession and Renewal
BOARD SUCCESSION AND RENEWAL For personal use only • Well established process through the Nominations Committee • Our obligation is to protect and grow the wealth and income of shareholders • Seeking a balance of deep investment and strong business experience • Board seeks to facilitate orderly rene
Slide 34: Australian Foundation Investment Company
AUSTRALIAN FOUNDATION INVESTMENT COMPANY
Australian Foundation Investment Company — Shareholder Meeting (October 2013) on 6ix