Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Shareholder Meeting (October 2024)
27 slides from Australian Foundation Investment's shareholder meeting presentation, October 2024
Slide 1: Annual General Meeting Presentation October 2024
Annual General Meeting - Presentation October 2024
Slide 2: Disclaimer
Disclaimer 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 faith. However, no warran
Slide 3: Agenda
Agenda Overview and Investment Objectives Mark Freeman Financial Results Andrew Porter Markets and the Portfolio David Grace Recent portfolio activity Winston Chong Outlook David Grace International Portfolio Mark Freeman Annual General Meeting / October 2024 2 7
Slide 4: Overview and Investment Objectives
Overview and Investment Objectives Full Year Results
Slide 5: Our Company
Our Company Invests in Australian and New Zealand companies Largest listed investment company on the ASX, 160k shareholders, independent Board of Directors Shareholders own the ‘management rights’ to the portfolio Management expense ratio of 0.15% with no performance fees Long term investor with low
Slide 6: Investment Objectives
Investment Objectives The Company’s primary investment goals are: • to pay stable to growing dividends over time; and • to provide attractive total returns over the medium to long term. Annual General Meeting / October 2024 10
Slide 7: Ensuring a Stable to Growing Dividend for Shareholders
Ensuring a Stable to Growing Dividend for Shareholders AFIC’s franking reserve balance ensures we can pay a consistent dividend even through volatile times – full year dividends last six financial years. Annual General Meeting / October 2024 11
Slide 8: Attractive Total Returns Over the Long-term
Attractive Total Returns Over the Long-term AFIC NTA vs ASX 200 Accumulation Index $10k in AFIC $180k $10k in the Index $135k Excludes the benefit of franking. Annual General Meeting / October 2024 12
Slide 9: Financial Results
Financial Results Annual General Meeting / October 2024
Slide 10: Financial Year in Summary
Financial Year in Summary * Assumes an investor can take full advantage of the franking credits. Annual General Meeting / October 2024 14
Slide 11: Share Price Relative to NTA
Share Price Relative to NTA 31 August 2024 NTA: $8.20 Share price: $7.35 Annual General Meeting / October 2024 15
Slide 12: Markets and the Portfolio
Markets and the Portfolio Annual General Meeting / October 2024
Slide 13: Portfolio Set to Perform in Most Economic Settings
Portfolio Set to Perform in Most Economic Settings Growth Companies Stalwarts 24% 34% AFIC Cyclicals 26% Income 16% Annual General Meeting / October 2024 17
Slide 14: Portfolio and Sector Performance – to August 2024
Portfolio and Sector Performance – to 31 August 2024 Portfolio Return (Including the Full Benefit of Sector Performance 12 months to 31 August 2024 Franking) – Per Annum to 31 August 2024 Past performance is not indicative of future performance. Sector returns do not include franking. Annual General
Slide 15: Market Valuation in a Long Term Context
Market Valuation in a Long Term Context ASX 200 Firms Trade at an Average Forward PE of 17.2x, which is 19% Above the 20-yr Average Source: Goldman Sachs Research Annual General Meeting / October 2024 19
Slide 16: Market Conditions
Market Conditions What’s Occupying Our Mind Earnings growth becoming more challenging with price rises expected to slow. Consumer spending is softening. Employment trends to be important. China. Announced policy initiatives attempting to stabilise market conditions. Majority of the Central Banks mov
Slide 17: Labour Productivity Remains Weak. Cost-out to be a Focus?
Labour Productivity Remains Weak. Cost-out to be a Focus? Falling demand and a historically tight labour ASX 200 (ex-REITs) annual growth in labour market impacting labour productivity. costs far exceeding sales growth. % Source: Goldman Sachs Research Annual General Meeting / October 2024 21
Slide 18: Recent Portfolio Activity
Recent Portfolio Activity Annual General Meeting / October 2024
Slide 19: Active Portfolio Management – Recent Transactions
Active Portfolio Management – Recent Transactions Additions to Existing Holdings Trimmed Holdings New Purchases Complete Disposals Annual General Meeting / October 2024 23
Slide 20: Recent Transactions – A Spotlight on Bank Valuations
Recent Transactions – A Spotlight on Bank Valuations ASX 200 Banks Valuation vs Earnings Trend times Source: Goldman Sachs Research Annual General Meeting / October 2024 24
Slide 21: ARB Corporation
ARB Corporation EPS vs Share Price ARB Corporation is a founder led global business operating in the 4WD parts and accessories market. Vertically integrated controlling all aspects of its business – design, development, manufacturing, distribution and retail. EPS cents Share Price (RHS) ASX 200 – In
Slide 22: CAR Group
CAR Group EPS vs Share Price CAR Group holds market leading positions in auto classifieds in Australia, USA, South Korea and Brazil. Management team with a long-term track record of delivering strong returns for shareholders. EPS cents Share Price (RHS) ASX 200 – Indexed (RHS) Ability to leverage CA
Slide 23: Outlook
Outlook Annual General Meeting / October 2024
Slide 24: Outlook
Outlook Slowing economic growth providing an increasingly challenging environment for companies to deliver earnings growth. Investment markets been prepared to pay high prices where there is a high degree of confidence of earnings growth. Drivers of market performance expected to broaden. We remain
Slide 25: International Portfolio
International Portfolio Full Year Results
Slide 26: Snapshot of the International Portfolio
Snapshot of the International Portfolio which has 42 holdings Annual General Meeting / October 2024 30
Slide 27: Australian Foundation Investment Company
AUSTRALIAN FOUNDATION INVESTMENT COMPANY
Australian Foundation Investment Company — Shareholder Meeting (October 2024) on 6ix