Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Investor Presentation (March 2024)
23 slides from Australian Foundation Investment's investor presentation, Mar 13, 2024
Slide 1: ASX cover letter: Information Meetings Presentation
13 March 2024 The Manager ASX Market Announcements Australian Securities Exchange Exchange Centre Level 4 20 Bridge Street Sydney NSW 2000 For personal use only Electronic Lodgement Australian Foundation Investment Company Limited Information Meetings – Presentation Dear Sir / Madam Please find atta
Slide 2: Shareholder Meeting March 2024
Shareholder Meeting For personal use only March 2024
Slide 3: Disclaimer
Disclaimer For personal use only Australian Foundation Investment Company Limited and its subsidiary (AICS) (AFSL 303209), 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
Slide 4: Agenda
Agenda For personal use only Overview and Investment Objectives Mark Freeman Markets and the Portfolio David Grace and Nga Lucas Outlook David Grace Shareholder Meeting / March 2024 3
Slide 5: Overview and Investment Objectives
For personal use only Overview and Investment Objectives Shareholder Meeting / March 2024
Slide 6: Our Company
Our Company For personal use only Invests in Australian and New Zealand companies Largest listed investment company on the ASX, over 160k shareholders, independent Board of Directors Shareholders own the ‘management rights’ to the portfolio Management expense ratio of 0.14% with no additional fees L
Slide 7: Investment Objectives
For personal use only Investment Objectives The Company aims to provide The Company’s primary investment goals are: shareholders with attractive investment • to provide attractive total returns over returns through access to a growing the medium to long term; and stream of fully franked dividends an
Slide 8: Attractive Total Returns over the Long-term
Attractive Total Returns over the Long-term AFIC NTA vs ASX 200 Accumulation Index For personal use only $10k in AFIC $152k $10k in the Index $123k Excludes the benefit of franking Shareholder Meeting / March 2024 7
Slide 9: Ensuring a Consistent to Growing Dividend for Shareholders
Ensuring a Consistent to Growing Dividend for Shareholders For personal use only AFIC’s franking reserve balance ensures we can pay a consistent dividend even through volatile times – full year dividends last 5 financial years AFIC’s franking reserve balance ensures we can pay a consistent dividend
Slide 10: Share Price Relative to NTA
Share Price Relative to NTA For personal use only 29 Feb 2024 NTA: $7.77 Share price: $7.39 Shareholder Meeting / March 2024 9
Slide 11: Markets and the Portfolio
For personal use only Markets and the Portfolio Shareholder Meeting / March 2024 10
Slide 12: February 2024 Reporting Season Review
February 2024 Reporting Season Review For personal use only Overall reported company results were in line or slightly ahead of market expectations. Revenue growth is slowing but margins are proving resilient as corporates cut costs. Increasing risk of regulation for large consumer facing companies a
Slide 13: Valuation in a Long Term Context
Valuation in a Long Term Context For personal use only Price to Book – S&P/ASX 200 Index Price to Sales – S&P/ASX 200 Index Average 1.9 Average 1.9 Source: FactSet Shareholder Meeting / March 2024 12
Slide 14: Portfolio and Sector Performance to February 2024
Portfolio* and Sector Performance to 29 February 2024 12 Month Sector Performance For personal use only * Per annum returns. Assumes the full benefit of franking credits. Past performance is not indicative of future performance. Includes dividends but not franking. Shareholder Meeting / March 2024 1
Slide 15: Portfolio Set to Perform in Most Economic Settings
Portfolio Set to Perform in Most Economic Settings For personal use only Growth Companies Stalwarts 24% 34% AFIC Cyclicals 26% Income 16% Shareholder Meeting / March 2024 14
Slide 16: Quality Growth Companies
Quality Growth Companies For personal use only Growth Companies Structural growth companies in large growing markets 34% 24% Strong customer proposition driving share gains Generate free cash flow that is reinvested in growth and efficiency 26% 16% CSL - Plasma, capital allocation, capacity and effi
Slide 17: Quality Stalwart Companies
Quality Stalwart Companies For personal use only Stalwart Companies Highly strategic, difficult to replicate assets with a market leadership position. 24% 34% Consistent earnings growth leading to a growing dividend profile. Wesfarmers – Bunnings, Kmart, Industrial and Healthcare 26% 16% Transurban
Slide 18: Quality Income Companies
Quality Income Companies For personal use only Income Companies Regulatory or asset-based barriers against new entrants. 24% Attractive dividend profile (preferably fully franked) with modest 34% earnings growth. Strong balance sheets 26% 16% Banks – benign bad debt environment, secure dividend Tels
Slide 19: Quality Cyclical Companies
Quality Cyclical Companies For personal use only Cyclical Companies Long life assets with low costs to operate. 24% 34% Ability to generate a meaningful return in low points of the cycle. Balance sheets in strong shape with the ability to invest in 26% growth projects as they emerge. 16% BHP & RIO.
Slide 20: Active Portfolio Management – Recent Transactions
Active Portfolio Management – Recent Transactions For personal use only Additions to Existing Holdings Trimmed Holdings New Purchases Shareholder Meeting / March 2024 19
Slide 21: Outlook
For personal use only Outlook Shareholder Meeting / March 2024
Slide 22: Outlook
Outlook For personal use only The rate of inflation is declining yet the cost of living remains elevated. Challenging environment for companies to deliver meaningful near term earnings growth. We remain focused on companies well positioned to create long term shareholder value. The portfolio is inve
Slide 23: Australian Foundation Investment Company
AUSTRALIAN FOUNDATION INVESTMENT COMPANY
Australian Foundation Investment Company — Investor Presentation (March 2024) on 6ix