Good morning, welcome to the WAM Strategic Webinar. Myself, you can see my fellow workers, Martyn McCathie and Jesse Hamilton are here with us. Also, Olivia Harris, from our corporate affairs will be doing the Q&A. Look, for us, it's a slightly new format this time. We're all, we're all in one room. Historically, we've been in different locations. Bear with us if it takes us a little while to work in this new environment. As you're all aware, I mean, the reason we're doing this webinar is you own the company. We love investing this money on your behalf. You know what we're doing, or what we're trying to do, we're buying undervalued companies and then when we can see a catalyst that we believe will change the value, and then we're holding them till that, you know, value is realized. With WAM Strategic, we take a medium-term view. You might think from the outside, you know, that the portfolio doesn't change much. We'll highlight with you today how where the opportunities present themselves, how, you know, we are very active. In terms of the performance of WAM Strategic, we're very, you know, we're very comfortable with the performance of the underlying portfolio over the last 12 months. You know, it's a little over, yeah, over the last 12 months, a little over 14%- odd, the portfolio is up. Over the last six months, the, you know, it's up about 9.8%. The last month, you know, there's been, you know, some of the stocks have come back a little bit. You know, we take a long-term view, sometimes the catalysts that we need take time to eventuate. The, in terms of the share price, our goal is to have it, the share price trading at a premium to NTA. The reason I say that is, you know, on a monthly basis, when we announce our NTAs, we show you the actual NTA, but also the look-through NTA. This was, again, thank you know, one of our investors suggested we do this. And we think that the right price for the share price should be sort of in between the pre-tax NTA and the look-through NTA. If you're looking at it today, you know, you're talking about, you know, a fair value of a share price, you know, closer or slightly above that 140 level. Now, the discount to actual hard NTA, you know, which did get out to the high teens, is now into about 10%. We expect that discount to continue to narrow until it gets to the premium. In terms of the dividends, you'd see, you know, the great thing about the listed investment company structure is, you know, that we might have a really good year this year. We can, you know, we can smooth the dividends and provide it to shareholders over time. You'd see as a board, you know, the board's decided to increase the dividend again for this last six months. That is our plan, is to continue to increase that dividend over time, and, you know, and to give you a really good, fully frank return. You'll see also, I think, Martyn, I think you're talking about it, or Jesse, how the flow-through yield from the companies we've invested in is high. Our ability to sustain that dividend with our profit reserve, you know, we're in a great space for that. Look, why don't I pass over to. To me Martyn? Yep. Yeah. Thanks. He'll take us through the next part. Yeah, I mean, we're just touching on the yield there. If we move on to the next slide, as Geoff said, the dividends that we're receiving from our investment portfolio, currently around about AUD 0.078 per share, grossed up to include the benefit of franking credits. That provides us with about 80% dividend coverage for the dividends that we are paying to shareholders. With the profit reserve mechanism and that look-through yield we're receiving, it means that that dividend that we're paying to end investors is very sustainable. We wanted to just highlight the defensive characteristics of the investment portfolio and how the portfolio has performed through volatile markets. Obviously, we're in the midst of a bit of a market shakeout at the moment. If we look at calendar year 2025, portfolio performed favorably when there was a market drawdown. As those of you watching, live can see on screen with the slides, the investment portfolio performed around about 1% through those four market drawdowns, compared to the market of slightly over 10%. Net positive outperformance in that period. What we're providing shareholders there is a downside capture ratio of around about 8.2%. When the market's falling, we're giving you 8.2% of the market fall. If you look at that over a. Which is good, because I'd prefer none of the market fall. Well, yeah, it's great. If we look at over a two-year period, it's around a similar number. It's about 8.8% drawdown. On the flip side, we're giving you 80% of the market upside, and so we're protecting the money. Obviously, if you fall 50% on the downside, you've got to make 100% to get back to equilibrium. If we're only doing 8% on the downside and we're doing 80% on the upside, in an undulating market like we are now, we'll be able to compound those returns really nicely, taking significantly less risk than the market. If we kind of step back and kind of zone out a little bit and look at the LIC sector more broadly... The sector has been, you know, there has been tailwinds into the sector. We'll touch on some capital reasons, the primary and secondary market. Discounts are narrowing. We've seen the weighted average discount across the sector narrowing, which is obviously favorable for our investment process, there is still opportunities. If we go on to the next slide, there's a bit of a splatter graph of where premiums and discounts are within the LIC sector. Average discounts are still around those kind of mid to high teens. With there's plenty of opportunities around about that, you know, 20, 25, even up to 40% discounts that we will look to take advantage of on behalf of investors. If we just look at the sector more broadly, as I said, there has been a net increase number of LICs in the market, the market capitalization of the LIC sector has hit all-time highs at the end of December. The structure, LICs and LITs, very much back in vogue. We've seen five to six new listings in the last 12 to 15 months. With some more to come this year. Yeah, the pipeline's looking really healthy. We'll touch on how that's a benefit for us as well as we go through. Just more to buy at a discount. Yeah, at over time. The option, you know, with the secondary market capital reasons as well, there was five IPOs, but there was a number of secondary market capital reasons. I think it was about AUD 1.4 billion-AUD 1.5 billion in primaries, and similar numbers in secondaries. obviously, as an institutional investor, we're able to participate in those secondaries, usually raised at a discount to current share price, so an arbitrage for us to be able to add value for our investor base. Was there any other slide? Oh, yeah, slide two. Yeah, look at the stocks. Yeah, looking at the portfolio, sorry. Our portfolio from a cash perspective, we're still sitting on 16% cash, and that has drawn down quite materially. I think the last webinar we did, we were sitting around with 30% cash after the full year. We have been a net deployer of capital in this environment, but very much, I think, as we said six months ago, selective in the opportunities that we're taking. Given the volatility in the market, very much the barrier for entry for new positions coming into the portfolio, is elevated at the moment, and we're looking for larger discounts to be able to participate. When we look at the kind of actively trading positions, again, as Geoff touched on at the start, we just wanted to highlight some of the positions that we are. You know, month to month reading NTAs, you might not be aware that we are active in managing these positions. A couple where we've taken, you know, increased positions, Carlton, LRT, and obviously Salter Brothers. You know, SB 2, Salter Brothers, those of you that watch the market of announcements will have seen that we have continued to increase our substantial shareholding in there. I think the last announcement we were at 19 point something% of the company, just before Christmas. Material position for us. Pleasingly had a positive release this week, and they were able to exit two of their unlisted investments. You know, the unlisted investments always carry a little bit of uncertainty, and they exited them at a meaningful premium to 31 December carrying value. There's about a AUD 7.8 million uplift or about AUD 0.088 per share. The share price responded positively, not all of that AUD 0.088. Per day. It was down yesterday. Yeah. short period, on relatively low volume, but it's, you know, the NTA has firmed up there. We had a positive view on the unlisted investments from doing work on the asset, and it's pleasing that's played out, and providing a bit of liquidity for those unlisted investments. The other two, Perpetual and NAOS, you know, Perpetual's a really interesting one pick. It's currently trading at a very small discount, 20, 30 basis points to live NTA on our internal models. It's one that we're trimming at the moment. It's a position that we've had in and out of the portfolio four times since IPO. That one in particular has provided us with lots of opportunities to buy when the discount at or around 10%, unlike it is at the moment, trim, as that discount reaches NTA parity. As I said, we touched on secondary market capital raisings and sell downs and liquidity events. Again, we have been active in that realm as well. Being able to participate in discounts to current trading value. Not long-term holdings for us, but the ability to generate annualized really strong returns from a small holding period. Was there any. Yeah. Jump to the Q&A. Jump to the Q&A, I think. Yeah. Sorry, right. Great. Thanks, everyone, thanks for sending in your questions. Just before we get into the Q&A, we have announced our 2026 national shareholder presentations, so there's a slide up on the screen. We would love to see you in a city that's closest to you. You can scan the QR code or visit the Events page on our website. The first question that we have is from George. He's asked if you have any further update on AOF. Does it intend selling its last remaining property as is, or is there consideration being given to refurbishing the building before reselling it at a potentially higher valuation? What does Moore intend to do with its AOF holding? Yeah. Well, yeah. National problem, isn't it? The problem with being in the middle is everybody looks at you. AOF, you know, for anybody that's not aware of AOF or just a little bit of the history, Property Investment Trust was divesting assets, it had contracts to sell all of its assets through FY 2025. One of the sales failed to settle, at a price of. It was AUD 31.5 million. The settlement was delayed, and the price was increased to, sorry, AUD 63.5 million, and it failed. The, the purchaser forgo their deposit, which is about AUD 4.5 million, AUD 4.7 million to the benefit of AOF, but it is now left with that remaining asset, 150 Charlotte Street in Brisbane. The live NTA at 30 June for the company was about AUD 0.44. It's currently trading about AUD 0.38, so trading at a discount to that stated NTA. For us, at the moment, you know, the strategy and the company are working through a campaign to exit that investment. It's interesting, you know, there is tax advantages from holding a property trust in Queensland with a single asset. So there's CGT, no, stamp duty- Stamp duty concessions by holding a single asset property trust. I guess whether the asset will be disposed of as a single asset or whether the trust will be acquired because of that CGT benefit, we're unknown, but the property is being actively marketed. Its valuation at the moment is AUD 52.5 million. AOF haven't released their half-year accounts yet. That's expected to be tomorrow, and we'll see where the valuation comes in there. I'm by no means a Brisbane property expert, but I know it is tough in that market at the moment, when you're looking at refurbishing properties. With the Olympics coming up, you know, material costs and all labor costs have gone up quite materially. Just a couple of risks there that we're actively watching. At AUD 0.38, it is at a discount to last stated NTA, and one we'll continue to monitor. If the share price falls, there's obviously opportunity. If someone comes in and bids for it, then we'll see where we go. We can't, like we're a big shareholder, but we're not, we're not managing it. Yeah We're not making the decisions in terms of whether it's spend the money and refurbish-. Yeah, sell. Yeah, or sell. We'll as investors, we'll see what the manager decides. If we think it's in shareholders' interest and our interest, then we'll support it. If we think it's not, then we'll have a different view. Have a different conversation. Yeah. Yeah. Thanks, guys. We have a couple questions on the discount from Jeremy and from Peter. Jeremy's asked: "What steps are you planning to reduce the substantial discount of the share price to NTA?" He says that, "Moving to pay dividends quarterly might be a catalyst to close that gap. Yeah, sort of the logic of going quarterly, I actually don't think. Sorry, if Jeremy has any evidence of how it helps, then please send it to me. Probably in the U.K., you know, to me, the bigger debate is whether you do six monthly or whether you do monthly. I think that's sort of the debate. Because quarterly, you know, I've seen various players in Australia go to quarterly. Does that help their, you know, the discount? It doesn't. In the U.K., I think over time, about half of the 400 listed, you know, sort of trust/company structures over there are quarterly. Does that solve the problem of discounts? It doesn't. That's one thing. In terms of. You look at the WAM entities, of our, is it nine listed investment companies, I think, six of them are trading at premiums, one's trading around NTA, and two are at discounts. Those two are at discounts is WAM Alternative Assets and WAM Capital. The discount on WAM Capital has declined recently. In the end, it is a supply/demand opportunity. In terms of, you know, how do you reduce the discount is, you know, you perform, you pay good dividends. You know, whether you. I don't think paying quarterly, or half-yearly makes any great difference. You know, monthly, maybe, but that's, it's an additional cost to shareholders, and it's probably a slightly different tweak. You know, with WMX, our WAM Income Maximiser, that's a monthly income product, and we're watching that closely, and that's done very well, even though at the moment it's a slight discount. Then in terms of its communication with your shareholders, its marketing, it's really aligning all your shareholders with what you're doing. It takes time. You'll see, you know, obviously, the aligning is occurring, because the discount over the last probably, I think since we announced our result, it's come in by about, you know, 4% or 5%, which in percentage terms, it's come in by about 30%. Yeah. You know, so. To me, you don't know exactly when that, you know, when the supply/demand equation will change. You know, what is equilibrium? In theory, you'd say equilibrium is a state of NTA, and last month it was- AUD 130, AUD 132. Yeah, AUD 132, and the look-through was, what was that? AUD 151. AUD 151. In theory, it should be trading at around AUD 132, you'd say. That's just as of the end of last month. Then you'll say, "Well, actually, I can look through and see what the investments are, so I'd probably pay a premium for that." That's why, you know, I was saying, it's probably a, you know, it's closer to AUD 140, in theory, you know, what the theoretical value is. I mean, if you, I mean, I know Buffett in the early days when he started, you know, his early investing was in closed-end funds. Yeah, because it's very easy to value closed-end funds. He started buying 100% of businesses, I remember when the market wasn't fully appreciating, in theory, he was trading at a discount to the value of the assets. He started valuing those businesses. In theory, he's, he was doing the look-through value, so we're sort of copying a few little things from the, from the big fella. I think a big- Yeah. A big thing on that is also investors understanding exactly what's in the portfolio and what we're doing, and you've got discounted assets with catalysts that sometimes take a while to come to fruition. We've got more active sort of trading opportunities as well. I do remember when we did the IPO, that people thought there was gonna be successive takeover bids- Yeah Lots of corporate activity. Well, Piggy sits right in the next month. Yeah. That's why we went to that big premium. Yeah. There were two, and so everyone thought it'd happen every week, but yeah. If you think, if you want short-term trading and that, then my recommendation is sell. Now, because the quicker those people leave, and the quicker you get everyone who's aligned with what you're doing, the quicker it'll trade at NTA. We found that with our WAM Research, it took us seven years to get that to trade at NTA, to get, you know, to explain to the investors what they've invested in. The crazy thing is, because we're so successful in terms of explaining it to them, they're all very happy, so none of them wanted to sell. It was only, what? Three or four years ago, I think it got to a 58% premium, which is ridiculous. That's ridiculous. Trading at a 58% premium is ridiculous, something trading at a 10% discount. I mean, one of the things we all learn, and I know it's frustrating, that it's not trading at NTA, and then would feel a lot better or a premium to NTA. patience is very important. Yep. Thanks, guys. The next question is from Colin on WAM Global. He's asked if you are now selling WAM Global as it is trading at a premium to NTA. Yeah. He also said, "Thanks for the great work the whole team is doing there. Um- Thank you. Happy to- Thank you. take that one. I mean, we've sold probably at least a third of the position. Yep. We have been selling. Obviously, we're in a bit of a blackout period at the moment with interim results and WAM Global putting out its announcement this week. Yes, we have been selling the position and taking advantage of that opportunity. Thanks, Jesse. The next question is from Barry. He's asked: "Why not hold VAS and VGS instead of cash? It would make for track benchmarks better. Yeah, well, the, I mean, fair question. If you want to track benchmarks, you're probably better off buying those entities. Or buy, you know, some of the, or, you know, buy an AFIC or an Argo, which is trading at a, well, 12.5%. Yeah Discount to NTA. You know, what our investment process is to buy those discounted asset plays. When we believe that at some point in time, the, you know, the assets and the share price will align, so we'll make. Yeah, we'll get exposure to the market, then we'll get that uplift of the discounts evaporating. In terms of, you know, whether we put, you know, the logic of putting our cash into the market means then we're just taking market risk. How we've always managed the money is we'd like to have a little bit of flexibility around deciding to increase our cash levels or not. Now, whether over time, yeah, because the market goes up over time, now, whether we can add value with that, then to me, that's, you know, you've got to assess that over time. It's just not, yeah, how we have decided to manage the money and how we've always historically managed the money. To me, you know, the important thing is we stay sort of true to life. If we do decide to do any of that, we'll clearly articulate that to you. Thanks, Geoff, and the next question is from Michael. He's asked if you can touch on succession planning. Succession planning? Well, yeah. Well, we're, yeah, well, Martyn, where are you going? You're the youngest. No. Jesse, where are you going? I know, I look the youngest. Like, how many people are in asset management now? Over 70 now. Yeah. yeah, 70 people, so there's, besides what you can see here, on the investment side, what have we got? Over 20. Yeah, over 20. There's, you know, a lot of bench strength. Hey, if I get hit by a bus, then I'm gone, so I don't have to worry about it. In terms of everyone else, we've got a sort of a protocol, you know, that everyone knows what their job is. You know, we've, yeah, I mean, Mike Cannon-Brookes Sr. had been, you know, working with us for quite a while, on sort of, you know, structuring the business. One of his big things is always, you know, "Who's gonna step into your spot if you get knocked over by a bus?" To me, at all the senior levels, you know, we've got, you know, someone to take over. We're all replaceable. All replaceable, yeah. Yeah, it could be by AI. Yeah. Thanks, Geoff. The next question is from Bruce in relation to the cash. He's asked: "What is a typical cash position as a% allocation for the fund versus minimum cash and maximum cash?" He says it will help him understand how we view opportunities. Yeah, well, it, I mean, it's part review opportunities, but also you've got to remember, we're taking a medium long-term view, so it's really having the cash for the opportunity to present itself. Now, one of the great things, and, you know, I've observed this over a long period of time, you know, with Soul Pattinson, you know, they've always had a little bit of a cash amount, so then when there's a real crisis, then you've got cash, you know, to, you know, to seize the opportunity. To me, it's really our cash level tends to be a function of the opportunities we see in front of us at that point in time. And also, can be of what the opportunities we think will present themselves. To me, the. We haven't got, you know, exact visibility of when the catalysts that, you know, we buy into play out. I suppose, you know, one example is, you know, Martyn, you mentioned, you know, we did have a small position in Carlton- Mm. Investments, you know, trading at a, was it 20%, you know, 25% off discount. Discount To NTA. Yeah, at some point in time, that will disappear. How will that happen? We don't know. When will that happen? We don't know, but it will. To me, it's utilizing the cash for the opportunities, but also having some cash back for the opportunities that haven't even presented themselves yet. You know, what have we got up to? Before, you know, what are we at? Probably 40% is the highest we've been. I think the highest has been about 40% since I've- And, and the lowest- That was still deploying opportunities, and then I think the lowest would've been sub-10%. Yeah, sub-10, some of the, you know, some of the opportunities, you know, the share price has got to NTA, or there's a catalyst or things changed, and we sold. Yeah, at the moment, like, having that about. You know, if you think 15%-20%, or sort of 10%-20%, we're comfortable, that's sort of. You know, that's, you know, sort of 80%-90% invested, with, you know, that 10%-20% if a real opportunity presents themselves. The reason why we're holding probably a little bit of more cash at the moment, we think there's some very clear opportunities right in front of us. We're just working on timing of that. Thanks, Geoff. That might, that might utilize all the cash at the moment. Yeah. Thanks, guys. The next question is from Chris. He's actually asked a question on WAM Capital, but we can still address it here. He says that he purchased WAM Capital many years ago for over AUD 2 a share, and it's now trading under AUD 2 a share. He says he's disappointed with the stagnant dividend, which is no longer fully franked, given the high inflationary environment. Could you provide some comment on WAM Capital? Yeah, all right. Well, I mean, I if you can please send in when you bought it, then we can give you a bit more context. If you bought it over AUD 2 a share, the probability is you paid a premium to NTA. Because if you go back, I think, four or so years ago, it was trading at about. I think it got to about a 32% premium to NTA. That broadly means you're buying AUD 1 of assets, and you're paying AUD 1.32 for something that's worth AUD 1. Then you talk about the dividend. You know, you've got to remember. We can actually work it out for you. The dividend is so high, then you're actually getting, The height of the dividend is a function of the fact that we didn't cut the dividend when COVID started, so we were already paying a high dividend, and the logic was to keep paying that high dividend while we had a profit reserve to pay it. Whether it's franked, you know, then it depends how much franking we've got. You know, at the moment, it's 60-odd% franked. Now, in terms of getting your return, what a lot of people do is they assume they get the dividend for free. I mean, at the moment, the market's. What's the market yield? Is it 3.8%? Probably something around there, and I think it's 70%. 60%, 70%. I think it last time I looked, yeah, it was 72% or 73% franked. Mm-hmm. You're getting about a 3% fully franked dividend, where WAM Capital, like, broadly, WAM Capital, if WAM Capital didn't pay you. You know, what's the trading, around AUD 1.70 something, you know, mid-70s? If it didn't pay you a dividend for the last or paid you just the market dividend for the last four- years, then the NTA. Sorry, then the share price would be over AUD 2. You've got to remember your return you've got, you know, you're getting a, you know, nearly a 10%, well, grossed up, you know, because we've got to pay tax to pay the franking, you're getting about a 12% annualized return. You're getting it all as dividend. That's. You know, a lot of people get confused with that. Please send in your details, and we can give you the return of the market or a little bit better than the market return, in terms of dividends, and tell you what your capital would be. Thanks, Geoff. The next question is from Rodney. He's asked, "What percentage of profits, or is there a percentage of profits that are reinvested? Yeah, effectively, everything's reinvested. Mm-hmm. Yep. Yeah, I mean, even though we've got a profit reserve, that's accounting. That's for accounting reasons. You know, like, you'll say, "How, what's the profit reserve at the moment?" It's, yeah, AUD 0.20, AUD 0.18 or something like that, AUD 0.18 odd? Yeah. We'll get you the exact figure. You know, a lot of people think that we put that sort of you know, sort of somewhere special, you know, and keep it in cash to give out to shareholders. No, we don't. We see the portfolio of our, what, AUD 250 million of assets? We just invest the portfolio, the AUD 250 million. Even though, you know, sort of, say, what's that, percentage? You know, say, 13%, 14% of it's in the profit reserve, we don't say, "Oh, we're gonna keep that 14% in cash, so we can pay it out in div- The profit reserve is just an accounting concept. We reinvest the profits, and then obviously, when we pay dividends, we rely on the profit reserve to frank the dividends, and then make available the cash that we have in the portfolio for the payment to shareholders. Thanks, Geoff and Jesse. The next question is from Jay. He's asked: "What is the outlook for the share price for WAR, which is currently below the issue price of $1.25? Well, I think the outlook's very positive. I mean, the issue price of AUD 1.25, the NTAs, you know, the last stated. 1.33. Yeah, AUD 1.33, and the look-through was AUD 1.51. That's the last stated one. The, you know, in terms of where should it eventually land, the share price, you know, I think it should be between that, you know, the pre-tax NTA and the look-through NTA. It's around that, you know, the high, you know, around that AUD 1.40, you know, low AUD 1.40 mark. Yeah, echoing your point there on talking about WAM Capital and talking about investor returns, we have paid almost AUD 0.27 in fully franked dividends to shareholders as well. Yeah. If we were trading at NTA, which is obviously our kind of current goal, is to at least get it to NTA parity, and we're trading at that AUD 1.33, obviously you'd have small capital growth, but your net return as an investor would be around about that AUD 1.60 mark when you include the AUD 0.27 that we've paid in dividends. Yeah. I think everybody would feel, you know, a bit happier if the share price was at AUD 1.33. Yeah, of course, of course. And you've had a reasonable income in a period... Yeah Where interest rates were a lot lower than they are today. Yeah. I think, you know, that's first our priority-. then- We'll get it sorted. Yeah, and the, and the offset against that is, "Hey, if I invest into something else, I get the yield. If I invest in the market, I get the yield. Get a yield, yeah. Yeah. Thanks, guys, and we have a couple questions on some specific LICs. Andrew, Sue, and Cam have asked about AFIC and Argo and AUI. Are they on WAR's radar? Well, they trade at a discount to NTA, so they have to be on the, on the radar. On the radar. Yeah, yeah. Any listed company that's trading below NTA or below what we believe is the NTAs on the radar. Yeah, I mean, we focus on listed investment companies, listed investment trusts, but we can, you know, have, you know, we have positions in operating companies if we think they're trading, you know, below, you know, what we believe is their, is the look-through assets. AFIC and Argo Investments trading at. You know, they're incredibly, you know, they're very well-managed companies. They're currently trading at discounts. If I wanted that style of investment, to me, it's, to me, they're great, investment opportunities. The other one was Australian United Investment Company Limited. Mm. Yeah. I mean, it'll be interesting, AUI and DUI merging. Mm. The, you know, I think that's probably positive. You know, one bigger entity. You tend to find that the financial planners, et cetera, like big, bigger, more liquid entities. Mm. You know, because if they want to buy AUD 10 million, AUD 20 million worth of stock for their clients, you know, they can. Yeah. That, I think that should be a positive. Yeah, I mean, we look at them, and we look at them closely. We think, you know, we think, you know, that they are, they look good value from a buyer perspective. Like, in terms of the catalysts, you know, what's the catalyst gonna change? You know, the discount. I think the discounts will narrow over time and go back to trade around NTA, and at some point in time, they'll trade at a premium, like they have historically. Thanks, Geoff. The next question is from James. He's asked: "Other than WAR, which LIC would you rate as the most undervalued and likely to return to NTA?" I think that's in relation to our LICs. It's a Dorothy Dixer from Jim. Jim knows the answer to that one. Yeah. Jim knows the answer. He just wants us to tell everybody else. Yeah. Yeah. 'Cause he's set. 'Cause he's set. He wants the share price to go. Yeah. We, as Geoff said, we've got two listed investment companies trading at a discount to NTA, WAR, which has been narrowing, the other one is WAM Alternative Assets. Again, using the LIC structure to provide retail shareholders with access to an institutional quality portfolio of unlisted investments. It's trading around about a 13%-14% discount to NTA. The 6 months to December investment portfolio performance was about 4.9%. Annualized, about 10%, which is what they're looking to deliver regardless of prevailing equity market conditions. The share price was a bit stronger than that, though. Share price, including the benefit of franking, was slightly over 10%, as that discount, like WAR, has started to narrow. Really interesting investment portfolio, with 40% private equity. It also includes water rights, which are a really interesting dynamic with the, with the government buyback and how dry it has been in South Australia for those water rights held in the Murray-Darling Basin. Also unlisted infrastructure, unlisted real estate, a little bit of private debt. Nick Kelly joined us 12 months ago. It's his anniversary just passed. Nick's been managing the portfolio for the last 12 months, and he's kind of made a couple changes just to make that portfolio work a little bit harder for investors. Something a little bit different, but unique, and the discount there, we think is really attractive. Yeah, the tough thing is, you know, there was a question earlier about what makes them trade at premiums and discounts around there, is if all of ours are trading at premiums, when someone asks that question, we couldn't answer it. Mm. It'll be a relative, that'll be a relative, yeah. Thanks. The next question is from Bill. He's asked, well, he says: "You mentioned WAR's recent outperformance, but, how far has it recouped earlier underperformance? In terms of the performance of the portfolio since... What is the performance of the portfolio since- 7% or 8%, approximately. Yeah, are we? Since IPO, a little bit under the market. Yeah, a little bit under the market. Strong in the last two, three- years. You gotta remember, you know, we're buying those discounted asset plays, which the discounted asset plays, a number of them are still trading at discounts. If we're using the AUD 1.51- Yeah For the performance number rather than AUD 1.33, then, yeah, it would be a different, yeah, it'd be a different result. Yeah. Um. Yeah, I think the answer is, as hopefully I said earlier. Mm-hmm Before the question, or after the question came in, is NTA is at AUD 1.33 above issue price, and we paid AUD 0.27 in dividends. All up, AUD 1.60 worth of value on a AUD 1.25 cost base. You've gotta remember, we're also. Yeah, a sort of risk reward. You know, Martyn said before, you know, historically, when the market's fallen, we haven't even fallen 10% of the market. Yep Fall. When the market's risen, we've risen more than that. you know, in terms of the risk you're taking in buying into this portfolio, it's not, you know, you're not buying into into a the technology companies or you're not buying into the different. You're buying into high growth, high risk. Yeah, yeah, a different portfolio. you know, like, we're not, you know, in terms of resource exposure, you know, where has a lot of the performance been over the last 12 months? In the Australian market, it's been resources, particularly mid and small-cap resources. Mm Been exceptional. Yep. That has been a big driver. You know, what exposure do we have to resources? We have, what would it be, 1% or 2%? 'Cause we've got that position. In LRT. Yeah, in LRT. You know, we've virtually gotten that. Yeah. Thanks, Geoff, and the next question is from Mahdi. He's asked: "What is your view on OPH, and do you plan to add more of it to WAR's portfolio? Well, we. We just, yeah, we just had an opportunity. We've had a couple of opportunities. We've probably traded AUD 25 million worth of the stock, you know, a AUD 15 million block and a AUD 10 million block. There was just, there was a seller, and, you know, we were able to make a market, as in, you know, bid for it at a low price, at a good discount to NTA, and then we sold out. You know, we're pretty much out at the moment. Now, if it was trading at a big discount, and there was a catalyst where... The catalyst for that was, A, it was trading at a discount, and B, we could buy it at a bigger discount, and then we believed we could sell it. Each time we made... We probably made, what is it, 4% or 5%? Yeah in probably a month each time we did it. Annualize that, and it's very, you know, it's a great result. Yeah. Thanks, the next question is from James. He said that Lowell and Tribeca were both available as resources at big discounts. Why did you pick Lowell over the other? The Lowell guys, we just thought the discount was big enough. It did have, like, exposure to smaller companies, you know, we just thought there was a better chance of the because of the size, the discount, narrowing. I mean, I think with both of them. Well, definitely Tribeca, I think, you know, we, and we said that publicly, you know, when they raised money a while back, you know, They didn't raise it in, you know, the best way possible in terms of looking after all shareholders. Yeah. Yeah. Thanks. The next question is from Bill. He's asked: "How do your views on AI influence your investment strategies and recent deployment of capital? Good question. Mm. We'll leave that to Martyn, we don't know the answer. Yeah. We will pass it down the line. Yeah. No, well, it hasn't, for me, it hasn't impacted in terms of managing parts of this portfolio- No ... it hasn't impacted at all. If anything, it, like, from a research perspective, it's impacted it. You know, in terms of... A classic example, a broker sent me an announcement the other day, and I went back to the broker and said, "Oh, what do you think of the announcement?" By the time... then he hadn't come back to me, so I just put it into, you know, the bot. And it came back and gave me a detailed analysis of the announcement, which I then sent to the CEO of the company and said, "Hey, what do you think of this?" He read it, and he said, "Wow, that's good." The broker still hadn't come back to me. That was probably a 10-minute turnaround. In terms of doing research- Yeah ... yeah, you know, it really does, it... Yeah, that's how I've found it to date. What about... Yeah, day-to-day operational efficiency... Yeah ... is improving. It doesn't necessarily change the implementation of our strategy and the deployment of capital. No. Have you guys used it for much else or? Yeah, just for. Yeah and sort of analysis. Yeah, you can, like, to me, anyone who's playing around, I know in theory they say we should be spending 1 hour a day on learning it. You know, I'm trying to spend, you know, a bit of time a day on it. To me, you can push it. You just keep trying to push it. You know, keep trying to ask it to do more things. Yeah, better analysis. Yeah, the numbers it gets. Yeah, that's where you've gotta check it. At the moment, it still gets the numbers wrong. Yeah, our business is a numbers business. You've gotta check it. Thanks, Geoff. The next question is from Andrew. He's asked if you can explain your exposure to Soul Patts. No, when they were doing Soul Patts, they were raising some money, and we just thought there was, you know, a shortish-term opportunity there. We participated in that placement, and then, and we made some money. Yeah. That was the... That was that one. Great. The next question is from Simon. He's asked: "Has the cash from the last half been deployed into new assets or used for adding to existing holdings? Good work, Simon. Yeah, the. A little bit of both, yeah. Yeah, a little bit of both. Yeah, like I said, we, you know, we, as Martyn said, we went to 19.9% in Salter. Oh, well, are we 19.9%? Broadly. I know we haven't announced. Broadly. Yeah, broadly. Broadly. In Salters. Carlton, there was an opportunity. Someone was selling a lot of Carlton at a discount they weren't selling at a discounted market. We bid at a discounted market, we bought it. What else have we been? Obviously, a few, that was a AUD 10 million, a AUD 15 million and a AUD 10 million trade in the last probably nine months. Yeah. What else have we been? What new ones? I don't think there's. There's one. Anyway, you've got to look further. I know you, Simon. You've got to look further down the list. Actually, you start at the start of the alphabet, and you'll get it. Yeah. We want a lot bigger position in that, but we just started there. Yeah, that one. That one. It was that one. Bailador was another one, where Soul's was actually selling out. They were cleaning up their peripheral holdings, and we bought them at a 30% discount, the NTA, and it's gone to a bigger discount to NTA. CD2? Yeah, exactly. CD2. CD2, yeah, we were. Yeah, unfortunately, they, well, fortunately, well, I don't know. We were active. We were, yeah, we're active building a bigger position there, then they paid back the capital. We probably would have preferred them, well, for us, because we're building a position not to pay back the capital initially. It would've been nice if we were at 19.9, then they paid back the capital. Yeah, there are a few. Thanks, Geoff. Thank you. The next question is from Bill. He's asked, "As the trust is now liquid, now being liquidated, is URF on your radar for investment? Yeah, sorry, we were a reasonable-sized shareholder in URF, and we sold out at AUD 41. AUD 41 near the highs. Yeah, yeah, we sold out at AUD 0.41. It was still trading at a discount then, but we just did some really detailed analysis, about, you know, their assets, and their ability to sell the assets, and also the value of the assets when they'd sold the bulk of them, and they were just left with the sort of the last 30%. We sort of came to the conclusion that it wasn't worth the risk. Yeah, now, what is it down to? AUD 0.18, AUD 0.19. Yeah, I think after the distributions they've paid- Yeah It's probably around about similar levels. Is it? Yeah. The discount's wider. Yeah Because it's lower asset base. It was the combination of the debt in the portfolio. Well, it was a leverage play, yeah, that's right. This was the debt when they were selling assets, and, you know, we I think we formed an assumption they were selling the better assets first. They were selling them at market value, less a 6% selling fee in the US. Just a different dynamic in how it sells. You're gonna 6% below cost, so with the leverage, it was kind of 10% off NTA, and then an assumption that, as Geoff said, to be left with a rump there, and you're gonna be stuck in and lose value there. Mm There was other opportunities that we thought there was more of an asymmetric return profile, so we took the opportunity to, when there was liquidity, to sell out of it and move on. It's interesting how often it comes up in conversation when we're talking to shareholders. Yeah. Everybody's got a little bit of it. Yeah. Yeah, not very good. Yeah, we, like, we, you know, we keep watching it, and if we think it makes sense, then, yeah, then we'll change our view. Thanks, Geoff. A little bit of a pivot here. We've got three questions on the CGT changes. One of them is from Sam. He's asked: "Are the capital gains tax changes the government is contemplating going to affect LIC shareholders or listed investments?" Graham has asked if you could share your thoughts on this CGT. Yeah, I hope not. I hope not. I'm in front of the Senate at. This afternoon. In three hours or in four hours. I don't think what they're contemplating is currently looking at investments from a listed perspective. You'd probably say. It's just property. Yeah. Yeah. They're looking at investment properties at the moment, in particular. Views, though, sort of how much detail? Yeah, well, yeah, to me. Well, what are the observations? One is the tax we pay on capital gains is high from global, you know, from a global perspective. Right. Yeah. I think, you know, that's one, that's on one hand, and on the other hand is, if you are gonna change, you know, change it, in theory, you know, we don't want it to be a cash grab by the government. Just to reduce it and take the money to use for something else. You actually want, yeah, if they are gonna change it, because in theory, what does a discount allow you to do? It allows you to invest in assets. What are the assets it allows you to invest in? Invest in, listed investment companies, trusts, equities, property, operating businesses. Now, if you wanted to, if increasing productivity is important, then would it make sense to use some of the benefit that's in, you know, the, that benefits property investment, which doesn't increase productivity or I think as the Greens say, help with that, what is it? The gap in, you know, help with younger affordability, then you're better off, if you can use that money on productivity, and then get, yeah, the people working, you know, getting paid more, and getting real wage growth rather than, not, then that helps the affordability side. Mm. That was sort of. That's the angle we're coming from. I think probably the biggest thing that everyone forgets is, the discount was introduced to simplify the tax system. The word discount is actually just a poor measure to account for inflation. We used to have a cost-based indexation method, where each year you would index the cost of your investment by the inflation rates. That got quite complicated if you held the asset for a long time. Mm. The government introduced the discount just as a simple measure to account for inflation. If we're looking at changing the discount, we probably need to get back to make sure we're sort of taxing real gains and not just nominal gains over the life of the asset. Depending on what asset you're in, and the return on that asset over that life of the holding period, will sort of sometimes impact the end result. I think property investments have done well, better than the share market, probably, over the medium term. The, maybe the discount could be adjusted, but we need to sort of look at the inflation rate and making sure we're accounting for that properly, versus just changing it to generate some additional income in the budget. Thanks for reminding me. I just had the mailing statement. I forgot to print that out. I'd better print that out for tonight. Thanks. Thanks, everyone. We've got three questions on Thorney. I'm gonna split them into two. The first one is, From Bill "You have a small holding in Thorney Technologies. Why is there not a holding in Thorney Opportunities, when it always seems to trade at a substantial discount? Well, we have a really small- Yeah. Yeah, we've got a small in both. Yeah. They're only small in both because they're trading at big discounts, and we haven't seen a catalyst. What was, Martyn, we were talking about which one yesterday and made the announcement they're reviewing? I think. The technology. Was the management team. Yeah, they said they're looking at the discount. Hey, if you're a shareholder, then, you know, then to me, I'd. Yeah, ask them. It's an opportunity- Ask them. To ask them. What you know, what they're doing. You find the discounts, they can't, they don't last forever. If you trade at a big discount for a long period of time, then eventually someone buys a position in you. Once they buy a position in, then it doesn't really matter if they're an activist or not. Once your register starts consolidating, it tends to continue to consolidate. They'll have to do something to, you know, deal with it at some point in time. For us, we just couldn't see the short-term catalyst, we just got a couple of little positions. Like, each position's about 0.3 or 1%. Really small positions. You know, if a catalyst becomes clear, we can build into it. Yeah, it's just finding that catalyst at the moment. Yeah. Yeah. Thanks, sticking with Thorney, James and Peter have followed up, said, "Thorney Technologies has had poor performance, yet you've invested. Have you engaged with them about their investment process, and what are the prospects for TEK? Well, you ask TEK about that. Like we, as we said, we've just got really small positions. You know, we're aware of the discount. We're broadly aware of their strategy. Of course, they would like the share price to trade at NTA at a premium. You know, the question is, are they spending enough effort to do that? You know, we've got how many people we've got in shareholder engagement, comms, and marketing now, Jesse? 15, 16. Yeah, we've got 15 to 16. Yeah, we've got a process that in terms of communicating with shareholders that to actually tighten up the share register to get the share price to trade at NTA. You know, you asked a question, well, why haven't you done it with WAR? I think, you know, it's happening now, and then we probably don't want to be in a position where everything's trading at a 10% premium to NTA. What would we do with those 15, 16 people? Exactly. That's right. That's right. Exactly. They'd be. Well. AI replaced. Yeah, yeah. Please not. The next question is from Kerry. The question is: "At the end of the first half, I see you have over 50% of your investments in global stocks. Will you expect this to increase or decrease in the next six months? Well, I think probably the, like, simple answer is we don't know yet. As we mentioned before, we're actively selling the WAM Global position, which is in that global bucket as well. There's a few other things in there that there's potential catalyst to play out, which could change the composition of the portfolio over the next six months. Yet to be seen at this stage. That poor, I guess, positions in the portfolio have been strong contributors to the performance for the last six and 12 months as well. Great. Thanks for that, Jesse. The next question is from Rob. He says he understands the strategy clearly on investing in LICs and LITs at a discount, but why do you own the whiskey play Lark? Yeah, well, in theory, it's buying asset plays at a discount. The focus, as we said in the prospectus, is listed investment companies, LICs and LITs. Yeah, we did own shares in AMP when they were trading at a discount to NTA, made good money, sold out. Global Data Centres. Global Data Centres, yeah, Well, it was an operating business. Private equity operating-type business. Yeah, type. Where we made, what, 30%, 40% on our money. Yeah. Lark, yeah, we put a small position in that. Yeah. Unfortunately, like, it's. Yeah, and the logic was discount assets. Yeah, we are valuing the, yeah, the inventory. Yeah, the whiskey under maturation. Exactly, that's right. I love that word. Yeah, the whiskey under maturation. Unfortunately, they've just had some real problems operationally. Yeah Haven't they? Management-wise, and, yeah, at various points in time, we've worked out, like. To me, it's been a bit of a value trap for us. You know, but we haven't sort of. Well, we bought some the other day. We actually just, and we traded them out. We made about a 10% return on- Yeah on that trade. That was just a- Yeah We had our little position. Then there was a block at a discount because someone knew that we were there. We just bought them and sold them. Yeah, like it's been a mistake to date. The share price is up 17% month to date, and what has been a. Not from what we paid. No, no. Exactly. Yes, yes. What has been a really difficult market. Yeah, yeah. Obviously, Stuart Vargas come in as Chief Executive Officer. Yeah. He's pretty impressive. Yeah. Yeah. Yeah, we had a quick meeting with him earlier this month. I think, you know, from a brand perspective, it's still Australia's premium whiskey brand. Yeah. The assets that they've got and the inventory they've got. It was a discount asset play. Yeah. It's another discount, and we can do that in operating businesses. You know, that's another area. Like, say, at the moment, you know, there's been a bit, there's a bit of carnage in technology. You could see a situation, you know, if I cast my mind back to the, you know, the, you know, back in the tech wreck or things like that, you know, we had. I remember Melbourne IT, you know, at one stage, you know, that got to AUD 9, you know, before the tech wreck, and then I think they fell, I think they were trading at a discount to cash. You're buying the operating business for nothing. Yeah in the tech wreck back in the early 2000s. You know, that'll be an opportunity for us. You know, like if there's real carnage, then we'll be scrounging around for those opportunities in technology companies. Historically, you know, not, it hasn't been recently, because, yeah, mining's had a big run, but, you know, those mining-type companies, yeah, they tend to be boom and bust. The ones that have raised a lot of capital, and then the bust comes, you can buy them. Discount a discount to cash. Yeah. Like in the, you know, I think in the GFC, when, you know, we're buying, you know, at one stage, we bought a fund manager. Mm. You know, Briscoe, Babcock & Brown. You know, when they were trading at a discount to cash. They had an operating business, but we could buy them at a discount to cash. Yeah. Of course, WAR wasn't around. We didn't buy them at WAR. We bought them one of the, in WAM Capital. Yeah. Thanks, we've got two questions on Cadence. The first one is from Peter. He said that, "CDM trades over a wide range. Why is it not in the portfolio?" Stuart has asked if you have any interest in Cadence Capital or Cadence Opportunities. No, we know them well. Like, to me, it's the catalyst, and, you know, it's one of the various opportunities, you know, that, you know, we can look at. You know, I mean, at the moment, what does Karl, like, Karl owns a big percentage of it, you know, so, who the manager is. In terms of what will the catalyst for change be, you know, to me, it's not that clear. Yeah. Thanks very much for that. The next question is from David. He's asked: "Have you looked at BTI and/or TOP? Yeah, BTI, we're in. You know, we bought the discount. Probably could have bought a little early, but, you know. We'll keep an eye on them. Mm. You know, I had a good chat with the, you know, the boss there, and just sort of explained how we communicate to shareholders, you know, strategy, and we're looking forward for them to do that. What was the other one? TOP. Which is in the portfolio. Yeah, yeah, Top. Oh, yeah, exactly. We just got a little bit. Yeah, we, which we mentioned earlier. Yeah. Thanks, Geoff. The next question is from James. He's followed up, actually: "What, other than Wilson LICs, is the most compelling to buy? I was wrong. What's your high- I was wrong. What's your high-conviction stock? We didn't want to know which other WAM LIC. Oh! He was a reverse road count. He's My answer was Future Gen Australia was gonna be my high conviction. What discount's that? It's just under 10%. Yeah. Yeah, well, like the both of Future Gens will get to NTA eventually. Yeah. You want a bigger discount than that. Yeah. I mean, the bigger ones would probably be looking at the top positions in our portfolio, so. What's that, the bigger? The big positions that we have in our portfolio trading at substantial discounts. Which are? Like SP Two. Yeah I s one. That's sort of one that I think we, yeah, have some more conviction in. Yeah. Well, there's gotta be something happen there eventually. Yeah. Yeah. Thanks. The next question is from Michael. He's asked if you can provide an update on Pengana, RG, and RG8. Okay, RG, RG1 and RG8? Yeah. Yeah. I mean, do you want to go through? We did, you know, how we did trade some, and how we did the switch, and then- Yeah. Yeah. Yeah, we have been active in both positions, you know, from around about March of last year. Both have performed strongly. Discounts have narrowed, the discounts have oscillated a little bit. Start of this year. VG or now named RG1, was trading at a much tighter discount than RGA. We were selling RG1 and redeploying the capital into RGA. Obviously, same investment manager, just playing the arb between the two discounts. Both narrowed, and we leaned into that, and we were trimming both. More recently, the discounts have widened again, when there's been a bit of a sell-off in the market. We have been pretty active with them, but they've both been really strong performers for us, which has been pleasing, which has been good. Pengana? Pengana, well, is one probably just to say wait for some updates. Obviously, Geoff and I are on the board. They're going through a strategic review process that Geoff and I are recused from. We are waiting, like other shareholders, to sort of hear the outcome of that at the moment. Yeah, I think the board indicated there might be an announcement the end of this week? Yeah, they said the end of February. It's probably something this week or next week. Thanks. The next question is from David. He said that some REITs are heavily discounted, like GDI, and HCW, and REP. Have you looked at them? HCW, that was the one I said on the other day. Yeah, yeah. Yeah. No, we're looking at them, and for us, it's, I mean, there's one thing buying the discounts, there's another thing if we can buy the discounts with a catalyst. Yeah. I mean, that's the harder part, to find the catalyst. Thanks, Geoff. Here's an interesting one from Graham. Will you set up a fund into cryptocurrencies minerals as a trading system in the very short term? Probably the answer is no, in the very short term. In the short term Probably not in the medium term, but who knows? Who knows. Yeah. Yeah. Thanks. The final question actually is from Barry. He's asked, "Has Wilson Asset Management considered a bid for DUI at around NTA? You'd be amazed at what we consider. Leave it there. Leave it. Thanks very much everyone for sending in your questions. Yeah. We got through all of them, and that was 40. Sorry, one's just come in from Eddie, who's asked, "When will the result for WAM and WAX be reported? They'll all be out before Friday. Yes. Yeah, yeah. Thanks. In the next sort of day or so. Yeah. That's all of them. Geoff, I'll pass it to you for any closing remarks. Yeah, look, hey, thank you, thank you, everyone. Thank you very much. I actually like this format, you know, when we're all in the one room. You know, it's probably easier to. Yeah bounce things off each other. Please, you know, you're the shareholders, you're the investors, you know, give us any feedback, you like. If you like this format better than the previous format, please. Any other suggestions, you know, as I mentioned, you know, the look-through NTA, you know, that was an investor's suggestion, and it is your company. You know, we love what we're doing, we'll continue to do it. Thank you for, you know, thank you for all the support. Bye.