Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Investor Presentation (March 2010)
29 slides from Australian Foundation Investment's investor presentation, Mar 15, 2010
Slide 1: ASX cover letter: Shareholder Information Meetings
15 March 2010 For personal use only The Manager Company Announcements Office Australian Securities Exchange Limited Exchange Centre Level 4 20 Bridge Street Sydney NSW 2000 Electronic Lodgement Australian Foundation Investment Company Limited Shareholder Information Meetings Dear Sir or Madam Please
Slide 2: Australian Foundation Investment Company Shareholder Meetings March 2010
For personal use only Australian Foundation Investment Company Shareholder Meetings March 2010
Slide 3: Disclaimer
Disclaimer For personal use only Australian Foundation Investment Company Limited, its related entities and each of its respective directors, officers and agents (together the Disclosers) have prepared the information contained in these materials in good faith. However, no warranty (express or impli
Slide 4: Directorship
Directorship For personal use only Appointment of Peter Williams as a Director on 3 February Previously Managing Director of Equity Trustees Over 40 years experience in the financial services industry Broad experience in investments, insurance and superannuation Appointment is part of the
Slide 5: Overview
For personal use only Overview
Slide 6: What Happened in the Market - All Ordinaries
What Happened in the Market - All Ordinaries For personal use only 5200 Price Index 5000 4800 4600 4400 4200 Value 4000 3800 3600 Strong recovery but some uncertainty persists, 3400 market has tended to trade in a range more 3200 recently 3000 9 9 9 9 9 9 09 9 10 09 9 09 10 9 -0 -0 -0 -0 -0 -0 l-0 -
Slide 7: All Ordinaries Price Index – A Long Term View
All Ordinaries Price Index – A Long Term View For personal use only
Slide 8: Key Investment Themes over the financial year to date
Key Investment Themes over the financial year For personal use only to date Ongoing participation in discounted placements/dividend reinvestment plans Added to holdings on our ‘watch list” during specific weakness Utilising attractive buy/write opportunities in the Trading Portfolio Now clos
Slide 9: Financial Results
For personal use only Financial Results
Slide 10: Financial Highlights - Half Year to December 2009
Financial Highlights - Half Year to 31 December 2009 For personal use only 2008 2009 Change Operating Profit After Tax $107.8m $94.1m -12.8% Reported Profit After Tax* $110.2m $93.6m -15.1% Operating Profit Per Share 11.1c 9.6c -13.7% Interim dividends per share 8.0c 8.0c - * This figure includes re
Slide 11: Total Income - Half Year to December 2009
Total Income - Half Year to 31 December 2009 For personal use only 2008 2009 Change Dividends and distributions $123.9m $90.5m -27.0% Revenue from Deposits $8.4m $2.3m -72.7% Other Revenue $1.7m $2.1m 20.9% Net losses/gains on Trading -$21.6m $12.4m Large +ve Portfolio Total Income $112.4m $107.3m -
Slide 12: Earnings Per Share and Dividends Per Share
Earnings Per Share and Dividends Per Share For personal use only 24.00 22.00 20.00 18.00 12.3 16.00 9.7 Cents per share 9.4 14.00 9.9 13.0 13.0 13.0 8.4 12.00 10.5 10.0 10.00 8.00 6.00 11.4 11.5 11.1 8.9 9.5 9.6 4.00 8.0 8.0 8.0 8.0 6.0 6.5 2.00 0.00 2005 2006 2007 2008 2009 2010 Financial year Earn
Slide 13: The Portfolio
For personal use only The Portfolio
Slide 14: Major Acquisitions in the Investment Portfolio
Major Acquisitions in the Investment Portfolio For personal use only (above $5m) Six Months to 31 December 2009 $m Hastings Diversified Utilities Fund 15.6 Oil Search 11.8 Amcor 11.0 Westpac Banking Group 9.9 Woodside Petroleum 9.8 Eastern Star Gas 9.2 Perpetual Limited 7.7 National Australia Bank 6
Slide 15: Major Sales in the Investment Portfolio
Major Sales in the Investment Portfolio (above $5m) For personal use only Six Months to 31 December 2009 $m Santos FUELS (a) 13.2 (a) Redeemed by the Company
Slide 16: Major Purchases in the Investment Portfolio
Major Purchases in the Investment Portfolio For personal use only (above $1m) from 1 January to 28 February 2010 $m Trust Company 4.1 Healthscope 1.3 CFS Retail Property 1.2
Slide 17: AFIC's Investment Structure – February 2010
AFIC’s Investment Structure – For personal use only 28 February 2010 Long Term Investment portfolio: ¾ A$4.7 billion ¾ Approximately 75 securities ¾ Focus on S&P/ASX 200 Trading portfolio: ¾ Up to 10% of total portfolio – currently A$56 million or 1.2% ¾ Short term positions ¾ Options writing st
Slide 18: Top Ordinary Securities – February 2010
Top 25 Ordinary Securities – 28 February 2010 For personal use only % of portfolio $million (excl. cash) * 1 BHP Billiton 585.9 12.4% 2 Westpac Banking Corporation 476.5 10.1% 3 Commonw ealth Bank of Australia 456.9 9.7% 4 Rio Tinto 251.9 5.3% 5 Wesfarmers (a) 235.6 5.0% * 6 National Australia Bank
Slide 19: Comments on Telstra and the NBN
Comments on Telstra and the NBN For personal use only ¾ Telstra is entitled to get appropriate value for its assets, including its customer traffic ¾ Shareholders are entitled to a fair outcome ¾ Are we in danger of establishing a new government legislated monopoly? ¾ Are there more cost effective a
Slide 20: Top Ordinary Securities – February 2010 con't
Top 25 Ordinary Securities – 28 February 2010 For personal use only con’t. % of portfolio $million (excl. cash) 11 Computershare 95.0 2.0% * 12 QBE Insurance Group 90.6 1.9% * 13 Santos 88.2 1.9% 14 Amcor 84.4 1.8% 15 Origin Energy 81.6 1.7% * 16 Oil Search 72.8 1.5% 17 Orica 62.8 1.3% 18 AGL Energy
Slide 21: Top Ordinary Securities – February 2010 con't
Top 25 Ordinary Securities – 28 February 2010 For personal use only con’t. % of portfolio $million (excl. cash) 21 West Australian New spapers Holdings 59.5 1.3% 22 Incitec Pivot 58.6 1.2% 23 Toll Holdings 54.4 1.1% * 24 Transurban Group 53.4 1.1% 25 Australian Infrastructure Fund 52.4 1.1% Total 3,
Slide 22: Annualised Portfolio Returns – to February 2010
Annualised Portfolio Returns –to 28 February 2010 For personal use only 50% 45.2% 44.7% 40% 30% 20% 11.1% 10% 8.0% 6.7% 8.4% 0.1% 0% -3.2% 1 year return 3 year return 5 year return 10 year return -10% Net Asset per share growth plus dividends S&P/ASX 200 Accumulation Index * After tax and expenses.
Slide 23: Share Price Relative to Net Asset Backing (before tax)
Share Price Relative to Net Asset Backing (before tax) For personal use only 20% Premium 15% 10% 5% 0% -5% -10% Discount -15% -20% Feb-00 Feb-02 Feb-04 Feb-06 Feb-08 Feb-10
Slide 24: The Market
For personal use only The Market
Slide 25: Outlook
Outlook For personal use only ¾ Australian economy benefiting from ongoing demand for resources and growth in Asia ¾ Recent reporting season has shown the benefit of investing in companies with quality franchises and management ¾ Equity markets have recovered to a point where valuations look reasona
Slide 26: ASX 200 Industrials Prospective PER - Rolling 12 Months Forward
For personal use only A u g Fe -8 8 10 12 14 16 18 20 22 b 9 A -9 u 0 g Fe -9 b 0 A -9 u 1 g Fe -9 b 1 Source: GSJBW Research estimates A -9 u 2 g Fe -9 b 2 A -9 u 3 g Fe -9 b 3 A -9 u 4 g Fe -9 b 4 A -9 u 5 g Fe -9 b 5 A -9 u 6 g Fe -9 Average: 14.5 b 6 A -9 u 7 g Fe -9 b 7 A -9 u 8 g Fe -9 b 8 A -
Slide 27: Expectations of strong earnings growth
Expectations of strong earnings growth For personal use only EPS GROWTH FORECASTS Core - ASX 300 Industrials (ex loss makers) (%) 25.0 FY 2011 20.0 15.0 FY 2007 10.0 FY 2010 5.0 FY 2008 ` 0.0 -5.0 -10.0 2007 2008 2009 FY 2009 2010 2011 -15.0 -20.0 6 7 8 9 6 7 8 9 6 7 8 9 6 7 8 9 0 0 0 0 0 -0 -0 -0 -
Slide 28: Our New Website
For personal use only Our New Website
Slide 29: Australian Foundation Investment Company Shareholder Meetings
For personal use only Australian Foundation Investment Company Shareholder Meetings
Australian Foundation Investment Company — Investor Presentation (March 2010) on 6ix