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Half Year ResultsJanuary 2025
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Half Year Briefing / January 2025 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 warranty (express or implied) is made as to the accuracy, completeness or reliability of any statements, estimates or opinions or other information contained in these materials (any of which may change without notice) and to the maximum extent permitted by law, the Disclosers disclaim all liability and responsibility (including, without limitation, any liability arising from fault or negligence on the part of any or all of the Disclosers) for any direct or indirect loss or damage which may be suffered by any recipient through relying on anything contained in or omitted from these materials.This information has been prepared and provided by AICS. To the extent that it includes any financial product advice, the advice is of a general nature only and does not take into account any individual’s objectives, financial situation or particular needs. Before making an investment decision an individual should assess whether it meets their own needs and consult a financial advisor.ABN: 56 004 147 1202 Disclaimer
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Half Year Briefing / January 2025 Overview and Investment ObjectivesMark FreemanFinancial ResultsAndrew Porter Markets and the PortfolioDavid Grace Recent portfolio activityWinston ChongOutlookDavid Grace 2 Agenda 3
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Full Year Results Overview and Investment Objectives
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Half Year Briefing / January 2025 Invests in Australian and New Zealand companiesLargest listed investment company on the ASX, 160k shareholders, independent Board of DirectorsShareholders own the ‘management rights’ to the portfolioManagement expense ratio of 0.15% (annualised) with no performance feesLong term investor with low turnover (tax effective). Portfolio and share price returns less volatile than the indexLong history of growing/stable fully franked dividendsTeam manages three other funds – Djerriwarrh, Mirrabooka and AMCIL 5 Our Company 5
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Half Year Briefing / January 2025 6 Investment ObjectivesThe 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.
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Half Year Briefing / January 2025 Attractive Total Returns Over the Long-term 7 $10k in AFIC $186k$10k in the Index $150kExcludes the benefit of franking. AFIC NTA vs S&P ASX 200 Accumulation Index
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Half Year Briefing / January 2025 Financial Results
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Half Year Briefing / January 2025 * Assumes an investor can take full advantage of the franking credits. Financial Half Year in Summary 9
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Half Year Briefing / January 2025 Ensuring a Stable to Growing Dividend for Shareholders 10 AFIC’s franking reserve balance ensures we can pay a consistent dividend even through volatile times – full year dividends last six financial years.
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Half Year Briefing / January 2025 Share Price Relative to NTA 1131 December 2024NTA: $8.24Share price: $7.41
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Half Year Briefing / January 2025 Markets and the Portfolio
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Half Year Briefing / January 2025 Portfolio* and Sector Performance to 31 December 20246 Month Sector Performance * Assumes the full benefit of franking credits. Per annum returns other than for six months. Past performance is not indicative of future performance.Includes dividends but not franking.13
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Half Year Briefing / January 2025 23%26%16%35%Portfolio Set to Perform in Most Economic SettingsAFICStalwartsGrowth Companies IncomeCyclicals 14 Portfolio at 31 December 2024, excludes cash.
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Half Year Briefing / January 2025 17.5%15.6%12.2%11.9%10.8%10.4%9.7%8.3%6.9%Quality Companies Find a Way to Grow 15 Holding since 2015 Holding since 2014 Holding since 2010 Holding since 2013Holding since 2013 Holding since 2016 Holding since 2013 Holding since 1999 S&P/ASX 20010 Year Sales CAGR Sales Growth Per Annum Since Our First Purchase 3.6%Holding since 2016 Source: Goldman Sachs
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Half Year Briefing / January 2025 Market Valuation in a Long Term Context 16Source: FactSet ASX 200 Firms Trade at an Average Forward PE of 17.6x, which is 20% Above the 20-yr Average
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Half Year Briefing / January 2025 Recent Portfolio Activity
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Half Year Briefing / January 2025 Active Portfolio Management – Recent Transactions 18 Additions to Existing HoldingsNew Purchases Trimmed HoldingsComplete Disposals
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Half Year Briefing / January 2025 Goodman Group 19• Global property company specialising in industrial property and digital infrastructure.• Founder led business with strong focus on highest and best use of sites. • Strategically located sites with access to power are well placed to meet growing demand for data centres. EPS vs Share Price 0.2 GW2.0 GWNorthAmericaContinental Europe/UK0.5 GWHong Kong1.0 GWAustralia &New Zealand1.3 GWJapanGlobal Power Bank: 5.0 GWSource: Goodman Group FY24 Presentation Source: Diogenes Research
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Half Year Briefing / January 2025 Amcor 20• Global packaging company with market leading positions exposed to consumer staples.• Capable management team with track record of delivering margin improvement. • Merger with Berry accelerates earnings growth, largely underwritten by synergies. AMC US¢ EPSSource: Diogenes ResearchAlcan acquisitionBemis acquisition0102030405060708090 Berry acquisition(announced Nov-24)
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Half Year Briefing / January 2025 Outlook
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Half Year Briefing / January 2025 Outlook 22 The valuation of the market is high at a time when earnings growth appears likely to slow. Heightened geopolitical tensions coupled with an election cycle in many developed markets may lead to a wide dispersion of potential investment outcomes in the near term. Maintaining a balanced portfolio remains appropriate. We remain focused on companies well positioned to create long term shareholder value. The portfolio is invested in well managed companies with proven track records of financial discipline capturing value-accretive opportunities as they arise.
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AUSTRALIAN FOUNDATION INVESTMENT COMPANY