Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Shareholder Meeting (September 2025)
35 slides from Australian Foundation Investment's shareholder meeting presentation, Sep 30, 2025
Slide 1: 2025 Annual General Meeting Presentation
30 September 2025 The Manager ASX Market Announcements Australian Securities Exchange Exchange Centre Level 4 20 Bridge Street Sydney NSW 2000 Electronic Lodgement For personal use only Australian Foundation Investment Company Limited 2025 Annual General Meeting Presentation Dear Sir / Madam The fol
Slide 2: Annual General Meeting Presentation
For personal use only Annual General Meeting Presentation September 2025
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: Agenda
Agenda For personal use only Overview and Investment Objectives Mark Freeman Financial Results Andrew Porter Markets and the Portfolio David Grace Recent portfolio activity Winston Chong Outlook David Grace Annual General Meeting / September 2025 2 7
Slide 5: Overview and Investment Objectives
For personal use only Overview and Investment Objectives Annual General Meeting / September 2025
Slide 6: Our Company
Our Company For personal use only Predominantly invests in Australian and New Zealand companies Largest listed investment company on the ASX, 150k shareholders, independent Board of Directors Shareholders own the ‘management rights’ to the portfolio Management expense ratio of 0.16% with no performa
Slide 7: Investment Objectives
For personal use only 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 / September 2025 10
Slide 8: Stable to Growing Dividend for Shareholders
Stable to Growing Dividend for Shareholders AFIC’s franking reserve balance ensures we can pay a consistent dividend even For personal use only through volatile times – full year dividends for the last 7 financial years. Current franking credit balance sufficient to pay 55c Dividend Annual General M
Slide 9: Attractive Total Returns Over the Long-Term
Attractive Total Returns Over the Long-Term AFIC NTA vs S&P ASX 200 Accumulation Index For personal use only $10k in AFIC $178k $10k in the Index $146k Excludes the benefit of franking. Annual General Meeting / September 2025 12
Slide 10: Financial Results
For personal use only Financial Results Annual General Meeting / September 2025
Slide 11: Summary Full Year Results
Summary Full Year Results For personal use only Annual General Meeting / September 2025 14
Slide 12: Share Price Relative to Net Tangible Asset (NTA)
Share Price Relative to Net Tangible Asset (NTA) For personal use only 31 August 2025 NTA: $8.34 Share price: $7.33 Annual General Meeting / September 2025 15
Slide 13: Markets and the Portfolio
For personal use only Markets and the Portfolio Annual General Meeting / September 2025
Slide 14: Portfolio Performance to August 2025
Portfolio Performance to 31 August 2025 For personal use only Per annum returns. Assumes the full benefit of franking credits. Only includes franking that has been paid out. Past performance is not indicative of future performance. Annual General Meeting / September 2025 17
Slide 15: Factors Behind Recent AFIC Portfolio Performance
Factors Behind Recent AFIC Portfolio Performance Portfolio Factors For personal use only Portfolio: Key Contributors +0.9% Portfolio: Key Detractors -4.0% Index Winners Missed: Gold -1.1% Non-Portfolio Factors CGT not yet paid out as franking -0.74% Management expenses -0.16% Annual General Meeting
Slide 16: Despite Near Term Headwinds Long-Term Opportunity Remains Significant
Despite Near Term Headwinds Long-Term Opportunity Remains Significant. For personal use only • Strong market position in all business units. • Demand for core IG product remains resilient and strong. •• The outlook for US healthcare funding remains highly uncertain • Highly cash generative business
Slide 17: Share Prices Have Diverged From Earnings Growth
Share Prices Have Diverged From Earnings Growth For personal use only 800 200 800 250 160 200 600 600 120 150 400 400 80 100 200 200 40 50 - - - - 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 202
Slide 18: Valuation Metrics – Price to Earnings of CBA vs. CSL
Valuation Metrics – Price to Earnings of CBA vs. CSL For personal use only 30x 50x 28x 45x 26x 26.3x 40x 24x 35x 22x 30x 20x 25x 18x 16x 20x 17.9x 14x 15x 2020 2021 2022 2023 2024 2025 2020 2021 2022 2023 2024 2025 Source: FactSet Annual General Meeting / September 2025 21
Slide 19: Mainfreight – Share Price Tracks Earnings
Mainfreight – Share Price Tracks Earnings For personal use only 5.0 90 80 4.0 70 60 3.0 50 40 2.0 30 1.0 20 10 0.0 0 EPS NZD (LHS) Share Price NZD (RHS) Source: FactSet Annual General Meeting / September 2025 22
Slide 20: A Cyclical Downturn Causing Short-Term Headwinds
A Cyclical Downturn Causing Short-Term Headwinds For personal use only • Market leader in a large, growing market • Founder led. Market leader in Australia • Debt-funded acquisition has weighed on the share price • Less established US business facing cyclical headwinds • Market opportunity remains u
Slide 21: The Gold Price Has Run to All Time Highs
The Gold Price Has Run to All Time Highs For personal use only 3,500 3,000 The gold price has reached record highs, driven by geopolitical uncertainty, Central 2,500 Bank Buying, rising Government debt, and Price (USD) easing monetary conditions (rate cuts) 2,000 History shows these moves are often
Slide 22: Recent Portfolio Activity
For personal use only Recent Portfolio Activity Annual General Meeting / September 2025
Slide 23: Active Portfolio Management – Recent Transactions
Active Portfolio Management – Recent Transactions For personal use only Additions to Existing Holdings Trimmed Holdings New Purchases Complete Disposals Nil. Annual General Meeting / September 2025 26
Slide 24: Why Are We Trimming Wesfarmers?
Why Are We Trimming Wesfarmers? For personal use only Price to Earnings Dividend yield 40x 36.3x 8.0% 35x 7.0% 30x 6.0% 25x 5.0% 20x 4.0% 15x 10x 3.0% 2.7% 5x 2.0% 2005 2010 2015 2020 2025 2005 2010 2015 2020 2025 Source: FactSet Annual General Meeting / September 2025 27
Slide 25: Goodman Group
Goodman Group For personal use only The Long Term Opportunity Short Term Weakness Significant data centre development pipeline Concerns about slowing capex by hyperscalers Continental GMG Share Price (A$) Europe/UK 45 2.0 GW 40 GREATER LONDON AMSTERDAM TOKYO 35 Japan LOS ANGELES MARDID FRANKFURT OSA
Slide 26: ARB Corporation
ARB Corporation For personal use only The Long Term Opportunity Short Term Weakness Growing traction in US export sales Soft Australian vehicle market and US tariff concerns ARB Export Sales (A$m) ARB Share Price (A$) 350 60 300 50 250 40 200 30 150 100 20 50 10 0 0 FY18 FY19 FY20 FY21 FY22 FY23 FY2
Slide 27: Outlook
For personal use only Outlook Annual General Meeting / September 2025
Slide 28: Our Confidence in the Long-Term Portfolio Outlook Remains Strong
Our Confidence in the Long-Term Portfolio Outlook Remains Strong For personal use only Growth Companies Stalwarts 24% 32% AFIC Cyclicals 27% Income 17% Excludes cash. Annual General Meeting / September 2025 31
Slide 29: US Market – Market Valuation Following Earnings Higher
US Market – Market Valuation Following Earnings Higher For personal use only S&P 500 Price / Earnings NTM S&P 500 EPS (USD $/Share) 25x 300 22x 250 19x 200 16x 150 13x 100 10x 50 2005 2009 2013 2017 2021 2025 2005 2009 2013 2017 2021 2025 Source: FactSet Annual General Meeting / September 2025 32
Slide 30: Australian Market – Market Valuation and Earnings Disconnected
Australian Market – Market Valuation and Earnings Disconnected For personal use only S&P/ASX 200 Price / Earnings NTM S&P/ASX 200 EPS (AUD $/Share) 21x 600 19x 550 17x 500 15x 450 13x 400 11x 350 9x 300 7x 250 2005 2009 2013 2017 2021 2025 2005 2009 2013 2017 2021 2025 Source: FactSet Annual General
Slide 31: Summary
Summary For personal use only Performance has been disappointing the last 12 months. It’s not where we expect it to be. A small number of stocks have significantly underperformed. We have reviewed all portfolio holdings and believe the portfolio remains well positioned to deliver our investment obje
Slide 32: Outlook
Outlook For personal use only Low economic growth is providing an increasingly challenging environment for companies to grow earnings. Slowing revenue growth means cost out initiatives increasingly required. In many cases, the valuations of companies with perceived earnings certainty is now at extre
Slide 33: International Portfolio
International Portfolio For personal use only • Portfolio was first initiated in May 2021. At 30 June 2025 valued at $168.1 million (1.6% of the AFIC total portfolio). • Significant preparatory work has been done for establishing a separate global investment company in the future. • We are still con
Slide 34: Snapshot of the International Portfolio
Snapshot of the International Portfolio which has 43 holdings For personal use only Annual General Meeting / September 2025 37
Slide 35: For personal use only
AUSTRALIAN FOUNDATION INVESTMENT COMPANY
Australian Foundation Investment Company — Shareholder Meeting (September 2025) on 6ix