Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — H1 2023 Earnings Presentation
24 slides from Australian Foundation Investment's earnings presentation, Jan 24, 2023
Slide 1: Half Yearly Results Webcast Presentation ASX cover letter
24 January 2023 The Manager ASX Market Announcements For personal use only Australian Securities Exchange Exchange Centre Level 4 20 Bridge Street Sydney NSW 2000 Electronic Lodgement Australian Foundation Investment Company Limited Half Yearly Results Webcast Presentation Please find attached the p
Slide 2: Half-Year Results January 2023
For personal use only Half-Year Results January 2023
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 Financial Results Andrew Porter Markets and the Portfolio David Grace Recent Portfolio Activity Nga Lucas Outlook David Grace Half-Year Results – January 2023 33 2
Slide 5: Overview and Investment Objectives
For personal use only Overview and Investment Objectives Half-Year Results – January 2023 4
Slide 6: Investment Objectives
For personal use only Investment Objectives The Company aims to provide The Company’s primary investment goals are: shareholders with attractive investment returns through access to a growing • to pay dividends which, over time, grow stream of fully franked dividends faster than the rate of inflatio
Slide 7: ESG Considerations are Integrated into Our Investment Framework
ESG Considerations are Integrated into Our Investment Framework For personal use only Approach to Environmental, Social and Engagement with Companies Governance (ESG) Factors • Long term sustainability of a company’s • We conduct our own evaluation of the merits business model is a key focus in our
Slide 8: Financial Results
For personal use only Financial Results Half-Year Results – January 2023 7
Slide 9: Interim Result Summary – Six months to December 2022
Interim Result Summary – Six months to 31 December 2022 For personal use only * Assumes a shareholder can take full advantage of the franking credits. Half-Year Results – January 2023 8
Slide 10: Share Price Relative to NTA
Share Price Relative to NTA For personal use only Half-Year Results – January 2023 9
Slide 11: Markets and the Portfolio
For personal use only Markets and the Portfolio Half-Year Results – January 2023 10
Slide 12: 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 Half-Year Results – January 2023 11
Slide 13: Portfolio Set to Perform in Most Economic Settings
Portfolio Set to Perform in Most Economic Settings For personal use only Growth Companies Stalwarts 33% 26% AFIC Cyclicals Income 17% 24% Half-Year Results – January 2023 12
Slide 14: Portfolio and Sector Performance to December 2022
Portfolio* and Sector Performance to 31 December 2022 12 Month Sector Performance For personal use only * Assumes the full benefit of franking credits. Per annum returns other than for six months. Includes dividends but not franking. Past performance is not indicative of future performance. Half-Yea
Slide 15: Reece: Long Term Investing
Reece: Long Term Investing For personal use only Reece Share Price vs S&P/ASX 200 Price Index 2,000 20 Year CAGR Reece: 13.7% 1,500 S&P/ASX 200 Price Index: 4.5% 1,000 500 0 Reece Share Price S&P/ASX 200 Price Index Half-Year Results – January 2023 14
Slide 16: Quality Companies Find a Way to Grow
Quality Companies Find a Way to Grow Sales Growth Per Annum Since Our First Purchase 14.2% 14.1% 3.2% For personal use only 13.2% S&P/ASX 200 10.7% 10.3% 9.7% 10 Year Sales CAGR 9.6% 7.2% 6.8% 6.6% Holding Holding Holding Holding Holding Holding Holding Holding Holding Holding since since since sinc
Slide 17: Recent Portfolio Activity
For personal use only Recent Portfolio Activity Half-Year Results – January 2023 16
Slide 18: Active Portfolio Management – Recent Transactions
Active Portfolio Management – Recent Transactions For personal use only Sales New Purchases Additions to Existing Holdings Complete Disposals Half-Year Results – January 2023 17
Slide 19: Wesfarmers
Wesfarmers For personal use only Wesfarmers is a conglomerate that operates a number of large, well known retail brands including Bunnings, Officeworks, Kmart and Target. Bunnings is one of the best retailers in the world generating very attractive shareholder returns. Bunnings is a key driver of ea
Slide 20: Auckland Airport
Auckland Airport For personal use only Auckland Airport owns a highly unique and strategic infrastructure asset. Freehold nature and large undeveloped landbank offers opportunity for long term growth. Expect post COVID international passenger recovery to drive earnings growth, currently at over 70%
Slide 21: PEXA
PEXA For personal use only A pioneer and leader in digital property settlements in Australia. Handles >80% of property transfer transactions and >90% of refinancing transactions in Australia. Has developed a deep network of practitioner firms, financial institutions, the RBA, land titles offices and
Slide 22: Outlook
For personal use only Outlook Half-Year Results – January 2023 21
Slide 23: Outlook
Outlook For personal use only The effects of inflation and high living costs are placing pressure on parts of the economy. Market valuations are slightly above long term averages with some downside risk. We remain focused on companies well positioned to create long term shareholder value. The portfo
Slide 24: For personal use only
For personal use only
Australian Foundation Investment Company — H1 2023 Earnings Presentation on 6ix