Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Investor Presentation (April 2008)
26 slides from Australian Foundation Investment's investor presentation, Apr 21, 2008
Slide 1: ASX lodgement cover letter - Shareholder Information Meetings Tasmania
For personal use only 21 April 2008 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 – Tasmania Dear Sir or M
Slide 2: Shareholder Meetings Tasmania - April 2008
For personal use only Australian Foundation Investment Company Shareholder Meetings Tasmania April 2008 Presentation
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: Australian Foundation Investment Company
Australian Foundation Investment Company For personal use only We invest shareholders’ capital in a diversified portfolio of quality Australian Companies to achieve: Dividends which, over time, grow faster than the rate of inflation; and Attractive total returns over the medium to long term
Slide 5: Our Approach to Investing
Our Approach to Investing For personal use only We BUY to hold for the medium to long term not resale SALES are not frequent, often driven by takeovers Not pressured from fund flows or the index
Slide 6: Comparative Price Index Returns Since July 2007
Comparative Price Index Returns For personal use only Since 1 July 2007 25% 15% 5% Resources -5% 8 7 7 08 7 -0 l-0 0 -0 n- p- ar ov Ju Se Ja M S&P/ASX 200 N -15% Industrials -25% Financials -35%
Slide 7: All Ordinaries Price Index - Monthly
For personal use only Value Ju n- 0 2500 3000 3500 4000 4500 5000 5500 6000 6500 7000 Se 2 p- 0 D 2 ec -0 M 2 ar -0 Ju 3 n- 0 Se 3 p- 0 D 3 ec -0 M 3 ar -0 Ju 4 n- 0 Se 4 p- 0 D 4 ec -0 M 4 ar -0 Ju 5 n- 0 Date Se 5 p- 0 increase of 1.7% D 5 ec -0 M 5 ar -0 Ju 6 n- 0 Se 6 1 July 07 to 31 December 07
Slide 8: All Ordinaries Price Index - A Long Term View
All Ordinaries Price Index – A Long Term View For personal use only
Slide 9: AFIC's Investment Structure - March 2008
AFIC’s Investment Structure – For personal use only 31 March 2008 Long Term Investment portfolio: A$4.8 billion Approximately 100 securities Focus on S&P/ASX 200 Trading portfolio: Up to 10% of total portfolio - A$139 million or 2.9% Short term positions Options writing strategies Fixed rate borrowi
Slide 10: Financial Highlights - Half Year to December 2007
Financial Highlights - Half Year to 31 December 2007 For personal use only 2007 2006 Change Operating Profit After Tax $110.7m $ 106.8m +3.7% AIFRS Reported Profit After Tax* $326.1m $114.4m Large Operating Profit Per Share 11.5c 11.4c +0.7% Interim dividends per share 8.0c 8.0c - * Includes realise
Slide 11: Major Acquisitions Investment Portfolio
Major Acquisitions Investment Portfolio For personal use only Six Months to 31 December 2007 $million Notes Wesfarmers 65.2 Takeover of Coles Group Wesfarmers PPS 55.6 Takeover of Coles Group Equity Trustees 9.8 Campbell Brothers 9.7 OneSteel 9.5 Takeover of Smorgon Steel
Slide 12: Major Disposals Investment Portfolio
Major Disposals (above $10m) Investment Portfolio For personal use only Six Months to 31 December 2007 $million Notes Coles Group 149.9 Takeover by Wesfarmers Rinker Group 114.2 Due to takeover by CEMEX Alinta 37.0 Sold prior to takeover Centro Properties 18.7 Southern Cross Broadcasting 18.6 Takeov
Slide 13: Comparative Price Index Returns Since January 2008
Comparative Price Index Returns For personal use only Since 1 January 2008 5% 31 January 29 February 31 March 0% -5% Resources -10% -15% S&P/ASX 200 Industrials -20% Financials -25% -30% -35%
Slide 14: Major Acquisitions in the Investment Portfolio
Major Major Acquisitions Acquisitions in in the the Investment Investment Portfolio Portfolio For personal use only Since131 (above $1m) December January to 312007 March 2008 $million QBE Insurance Group 11.4 National Australia Bank 10.3 Commonwealth Bank 5.9 Westpac Banking Corp 5.0 Bradken 3.7 BHP
Slide 15: Major Sales in the Investment Portfolio
Major Sales in the Investment Portfolio For personal use only (above $1m) 1 January to 31 March 2008 $million Asciano Group 32.0 Symbion Health 8.5 Bunnings Warehouse 5.5 Macquarie Group 4.7 Spotless Group 2.1
Slide 16: For personal use only
For personal use only 20% 18.0% 17.1% 15% 14.0% 12.2% 11.4% 10.8% 10% 5% 0% 1 year return 5 year return 10 year return -5% -4.3% -4.4% -7.0% -10% Net Asset per share growth plus dividends Share Price growth plus dividends S&P/ASX 200 Accumulation Index ! " #$
Slide 17: AFIC Share Price Relative to Net Asset Backing
AFIC Share Price Relative to Net Asset Backing For personal use only 20% Premium 15% 10% 5% 0% -5% -10% -15% Discount -20% Mar-98 Mar-00 Mar-02 Mar-04 Mar-06 Mar-08
Slide 18: Top Ordinary Securities - March 2008
Top 25 Ordinary Securities – 31 March 2008 For personal use only % of $million portfolio * 1 BHP Billiton 512.5 10.4% * 2 Commonwealth Bank of Australia 333.9 6.8% * 3 Wesfarmers (a) 320.8 6.5% * 4 Rio Tinto 306.7 6.2% 5 Westpac Banking Corporation 296.4 6.0% * 6 National Australia Bank 222.0 4.5% *
Slide 19: Top Ordinary Securities - March 2008 (cont.)
Top 25 Ordinary Securities – 31 March 2008 For personal use only con’t. % of $million portfolio 11 Incitec Pivot 91.4 1.9% 12 West Australian Newspapers Holdings 86.4 1.8% * 13 Toll Holdings 82.3 1.7% * 14 Alumina 78.0 1.6% * 15 AMP 74.8 1.5% * 16 Amcor 74.4 1.5% * 17 Brambles 72.5 1.5% * 18 Westfie
Slide 20: Top Ordinary Securities - March 2008 (cont.)
Top 25 Ordinary Securities – 31 March 2008 For personal use only con’t. % of $million portfolio 21 QBE Insurance Group 67.1 1.4% 22 St George Bank 65.4 1.3% 23 Orica 65.0 1.3% 24 Transurban Group 57.2 1.2% * 25 Oil Search 56.5 1.2% Total 3,684.2 As % of Total Portfolio Value 75.0% (excludes Cash & B
Slide 21: For personal use only
For personal use only ! Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- Feb- 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08
Slide 22: For personal use only
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Slide 23: For personal use only
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Slide 24: For personal use only
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Slide 25: Outlook
Outlook For personal use only Markets nervous about the flow-on effects of a US slowdown Inflationary pressures still of concern Earnings outlook is subdued Interest coverage/debt maturity is a key issue Equity market down significantly from record highs but value starting to emerge Australia has tw
Slide 26: Australian Foundation Investment Company - Shareholder Meetings Tasmania
For personal use only Australian Foundation Investment Company Shareholder Meetings Tasmania April 2008
Australian Foundation Investment Company — Investor Presentation (April 2008) on 6ix