Half Yearly Report and Accounts as at 31 December 2020

Appendix 4D Statement
for the Half-Year ending
31 December 2020
20
20
Contents
• Results for Announcement to the Market
• Media Release
• Appendix 4D Accounts
• Independent Auditors’ Review Report
This half-year report is presented under listing rule 4.2A
and should be read in conjunction with the Company’s
2020 Annual Report.
This announcement was authorised for release by the
Board of Australian Foundation Investment Company Limited.
Australian Foundation Investment Company Limited
ABN 56 004 147 120

RESULTS FOR ANNOUNCEMENT TO THE MARKET
The reporting period is the half-year ended 31 December 2020 with the previous corresponding
period being the half-year ended 31 December 2019. The results have been reviewed by the
Company’s auditors.
Results for announcement to the market
Revenue from operating activities was $96.2 million, down $61.3 million or 38.9% from the
previous corresponding period. This excludes capital gains on investments.
Profit after tax was $84.1 million (down 42.4% on the previous corresponding period’s
$146.1 million).
Profit after tax attributable to members was $83.7 million (down 42.6% on the previous
corresponding period’s $145.7 million).
The interim dividend is 10 cents per share, fully franked, the same as last year. The dividend
will be paid on 23 February 2021 to ordinary shareholders on the register on 9 February
2021 and the shares are expected to commence trading on an ex-dividend basis on 8
February 2021. There is no conduit foreign income component of the dividend.
A Dividend Reinvestment Plan (DRP) and Dividend Substitution Share Plan (DSSP) are
available, the price for which will be set at a 5% discount to the Volume Weighted Average
Price of the Company’s shares traded on the ASX and Chi-X automated trading systems
over the five trading days from when the shares trade ex-dividend. The last date for the
receipt of an election notice for participation in the DRP & DSSP is 5.00 pm (Melbourne
time) on 10 February 2021.
The final dividend for the 2020 financial year was 14 cents per share (fully franked), and it
was paid to shareholders on 1 September 2020.
Net tangible assets per share before any provision for deferred tax on the unrealised gains
on the long-term investment portfolio as at 31 December 2020 were $6.64, up from $6.63 at
31 December 2019 (both before allowing for any announced dividends).
2

Half Year Report to 31 December 2020
AFIC invests in a diversified portfolio of Australian equities, seeking to provide
attractive income and capital growth to shareholders over the medium to long term at a
low cost.
Half Year Profit was million $84.1, down from $146.1 million in the corresponding period
last year.
Difficult operating conditions arising from the COVID-19 pandemic meant investment
income for the six months to 31 December 2020 was $95.2 million, down from $164.1
million in the corresponding period last year. The biggest reductions came from the
major banks, BHP, Macquarie Group and Transurban, while a number of companies in
the portfolio did not pay a dividend during the half.
Despite the fall in the half year earnings per share to 6.9 cents, the interim dividend for
the half year is 10 cents per share, fully franked, the same as the previous
corresponding period. Part of the interim dividend this year has been funded from
reserves.
The six-month portfolio return, including franking, was 15.2% compared with the
S&P/ASX 200 Index, including franking, which was up 13.7% over the same period.
For the 12 months to 31 December 2020, the portfolio return, including franking, was
5.8%. The return from the S&P/ASX 200 Accumulation Index over this period, including
franking, was 2.4%.
The management expense ratio for AFIC is 0.10% (annualised), with no performance fees.
Moving into the remainder of the financial year, we consider the portfolio is relatively
well positioned in high quality companies which we believe are well placed to deliver
earnings growth over the long term.

Portfolio Performance (including the full benefit of franking) − to 31 December 2020
Per an
num returns other than for 6 months. AFIC’s performance numbers are after costs.
3

Portfolio Performance


The Australian equity market was pushed higher in the first half of the financial year as global
markets rallied on the back of very low interest rates, significant government stimulus and
increased confidence about effective vaccines for the Coronavirus pandemic. This is despite the
negative impact the pandemic is having on corporate earnings and renewed outbreaks of the virus
in key global economies.
Through this period, AFIC has continued to focus the portfolio on quality businesses with a
competitive advantage, strong returns on invested capital and resilient balance sheets. This has
delivered a satisfactory portfolio performance despite not being in some of the more cyclical
sectors of the market which have rebounded more recently as investors look for value in previously
underperforming sectors, such as travel.
AFIC’s portfolio was up 15.2% for the six months to 31 December 2020 compared with the S&P/ASX
200 Accumulation Index, which was up 13.7% over the same period. These figures include the benefit
of franking credits, with AFIC’s performance numbers after costs.
Companies in the portfolio that contributed strongly to returns through the 6 month period were
Commonwealth Bank, BHP, Mainfreight, Xero, Wesfarmers, James Hardie Industries, ARB
Corporation and Reece.
Portfolio Adjustments

Portfolio turnover was lower during the past six months than in previous periods. Repositioning of the
portfolio in prior years has produced an increased weighting toward our preferred companies with little
need for extensive adjustments. At 31 December 2020, there were 61 companies in the portfolio.
Having taken advantage of the large market falls in March and April 2020 to participate in selected
capital raisings, further volatility during the past six months has provided opportunities to add to
holdings in Woolworths, CSL and ASX. The purchase of Sydney Airport stock was through the
participation in their entitlement issue. Two new companies were also added: Fineos, a software
business for insurance, and Nanosonics, a medical device company.
Major sales included the complete disposal of South32, reduction of the holding in Alumina and a
trimming of the holdings in Oil Search and Cleanaway Waste Management. Other sales included a
reduction in James Hardie Industries, as the share price ran up very strongly through the period, and
National Australia Bank, as the share price made strong gains following its capital raising in May 2020.

Outlook

The immediate course of the pandemic remains uncertain as does the outlook for corporate earnings
and dividends. The longevity and effectiveness of monetary policy and fiscal stimulus appear to
remain key to underlying economic conditions, as does the potential effectiveness of Coronavirus
vaccines moving into the new calendar year. While equity markets are continuing to be heavily
influenced by low interest rates, and with valuations for many companies at a high point, any negative
sentiment could produce significant volatility. We believe the portfolio is well positioned for the long
term should this occur. AFIC has sufficient funds available should good buying opportunities arise in
the second half of the financial year during any market weakness.

Please direct any enquiries to:
Mark Freeman Geoff Driver
Managing Director General Manager
(03) 9225 2122(03) 9225 2102

20 January
2021
4

MAJOR TRANSACTIONS IN THE INVESTMENT PORTFOLIO
Acquisitions
Cost
($’000)
Woolworths Group 25,158
Fineos Corporation 20,998
Sydney Airport
(1 for 5.15 entitlement offer) 18,986
Nanosonics 18,518
CSL 15,071
ASX 14,808
Disposals
Proceeds
($’000)
South32
#
35,848
Alumina 22,869
Oil Search 21,471
James Hardie Industries 18,949
Cleanaway Waste Management 17,961
National Australia Bank 15,456
#
Complete disposal from the portfolio.
New Companies Added to the Investment Portfolio
Fineos Corporation
Nanosonics
5

TOP 25 INVESTMENTS AS AT 31 DECEMBER 2020
Includes investments held in both the Investment and Trading Portfolios.
Total Value
$ million
1 Commonwealth Bank of Australia648.78.1%
2 CSL 615.77.7%
3 * BHP Group590.67.4%
4 Wesfarmers 371.54.7%
5 Transurban Group 322.94.1%
6 Westpac Banking Corporation301.13.8%
7 Macquarie Group 300.43.8%
8 * National Australia Bank271.53.4%
9 Woolworths Group 249.23.1%
10 * Rio Tinto227.32.9%
11 Mainfreight 211.92.7%
12 Australia and New Zealand Banking Group 192.72.4%
13 Amcor177.92.2%
14 * James Hardie Industries175.42.2%
15 * Sydney Airport163.92.1%
16 Telstra Corporation 162.42.0%
17 Brambles 128.71.6%
18 Coles Group 128.21.6%
19 Xero 127.81.6%
20 Goodman Group126.41.6%
21 Sonic Healthcare 119.11.5%
22 Ramsay Health Care 119.11.5%
23 Seek 118.71.5%
24 Reece 117.71.5%
25 ResMed110.31.4%
6,079.1
As % of Total Portfolio Value 76.3%
(excludes Cash)
* Indicates that options were outstanding against part of the holding
Valued at closing prices at 31 December 2020
% of
portfolio
6

P
ORTFOLIO
P
ERFORMANCE TO
31

D
ECEMBER
2020

P
ERFORMANCE
M
EASURES TO
31

D
ECEMBER
2020
6

M
ONTHS

1
YEAR

5
YEARS
%PA
10
YEARS
%PA
P
ORTFOLIO
R
ETURN
–

N
ET
A
SSET
B
ACKING
R
ETURN INCLUDING
DIVIDENDS REINVESTED
14.1% 4.1%
7.9% 7.6%
S&P/ASX

200

A
CCUMULATION
I
NDEX
13.2%
1.4%
8.7%
7.8%
P
ORTFOLIO
R
ETURN
–

N
ET
A
SSET
B
ACKING
G
ROSS
R
ETURN
INCLUDING DIVIDENDS REINVESTED
*

15.2% 5.8% 9.8% 9.5%
S&P/ASX

200
GROSS
A
CCUMULATION
I
NDEX
*
13.7%
2.4%
10.2%
9.4%
* Incorporates the benefit of franking credits for those who ca
n fully utilise them.
Note: AFIC net asset p
er share growth plus dividend series is
calculated after management expenses, income tax and
capital gains tax on realised sales of investments. It should also be noted that Index returns for the market do not include the impact of management expenses and tax on their
performance.
Past performance is not indicative of future performance.
7

A
USTRALIAN
FOUNDATION
INVESTMENT
C
OMPANY
LIMITED
ABN 56 004 147 120
HALF-YEAR REPORT
31 DECEMBER 2020
8

COMPANY PARTICULARS
Australian Foundation Investment Company Limited (“AFIC”)
ABN 56 004 147 120
AFIC is a Listed Investment Company. As such it is an investor in equities and similar securities on the
stock market primarily in Australia.
Directors:
John Paterson, Chairman
Ross E. Barker
Rebecca P. Dee-Bradbury
Graeme R. Liebelt
David A. Peever
Catherine M. Walter AM
Peter J. Williams
R. Mark Freeman, Managing Director
Company Secretaries:
Matthew J. Rowe
Andrew J.B. Porter
Auditor:
PricewaterhouseCoopers, Chartered Accountants
Country of
incorporation:
Australia
Registered office: Level 21
101 Collins Street
Melbourne, Victoria 3000
Contact Details: Mail Address:
Telephone :
Facsimile:
Email:
Internet address:
Level 21, 101 Collins St., Melbourne, Victoria 3000
(03) 9650 9911
(03) 9650 9100
inv
est@af
i.com.au
afi.com.au
For enquiries regarding net asset backing (as advised each month to the
Australian Securities Exchange):
Telephone: 1800 780 784 (toll free)
Share Registrar: Computershare Investor Services Limited
Mail Address:
AFIC Shareholder
enquiry lines :
Facsimile:
Internet:
GPO Box 2975, Melbourne, Victoria 3001
Yarra Falls, 452 Johnston Street, Abbotsford, Victoria
3067
1300 662 270 (Aus)
0800 333 501 (NZ)
+613 9415 4373 (from overseas)
(03) 9473 2500
www.investorcentre.com/contact
For all enquiries
relating to shareholdings, dividends and related matters, please
contact the share registrar.
Securities Exchange
Codes: AFI Ordinary shares (ASX and NZX)
9

DIRECTORS' REPORT
The Dire
ctors present their report in relation to the half-year to 31 December 2020 on the
consolidated entity (“the Group”) consisting of Australian Foundation Investment Company Limited
(“the Company” and “AFIC”) and its subsidiary, Australian Investment Company Services Limited
(“AICS”).
Directors
The following persons were Directors of the Company during the half-year and up to the date of
this report:
J. Paterson (appointed June 2005)
R.E. Barker (appointed
October 2001)
R.P. Dee-Bradbury (appointed May 2019)
G.R. Liebelt (appointed June 2012)
D.A. Peever (appointed November 2013)
C.M. Walter AM (appointed August 2002)
P.J. Williams (appointed February 2010)
R.M. Freeman (appointed January 2018)
Review of the Group's operations and results
Overview
The Company maintains a diversified portfolio of equity and similar securities, predominantly in
entities listed on the Australian Securities Exchange. There has been no change in the nature of
the Company’s activities during the period. Its primary objectives are to pay dividends which, over
time, will grow at a faster rate than inflation, and to generate attractive total returns in terms of
growth in net asset backing plus dividends.
Profit Performance and Dividend
Profit for the half-year was $84.1 million, down 42% from the previous corresponding period. The
decrease was predominantly due to a fall in dividends received as a consequence of the
coronavirus pandemic and the governmental and economic reaction to it.
The net profit per share for the six months to 31 December 2020 was 6.9 cents per share with an
interim dividend declared of 10 cents per share fully-franked, the same as last year.
The portfolio return for the 6 months (measured by change in net asset backing per share plus
dividends reinvested) was 14.1% compared to the return of the S&P/ASX 200 Accumulation Index
for the same period which was 13.2%. AFIC’s portfolio return is calculated after management
fees, income tax and capital gains tax on realised sales of investments and does not reflect the
value of franking credits or LIC credits attached to the dividends. Index returns for the market do
not include the impact of management expenses and tax on their performance.
During the half-year 6.4 million shares were issued under the DRP and the DSSP resulting in an
additional $35.1 million of capital (after costs).
10

Auditors’ inde
pendence declaration
A copy of the auditors’ independence declaration as required under section 307C of the
Corporations Act 2001 is set out on page 12.
Rounding of amounts to nearest thousand dollars
The Group is of a kind referred to in the ASIC Corporations’ (Rounding in Financial/Directors’
Reports) Instrument 2016/191, relating to the "rounding off" of amounts in the directors' report and
financial report. Unless specifically stated otherwise, amounts in the directors' report and financial
report have been rounded off to the nearest thousand dollars in accordance with that Instrument.
This report is made in accordance with a resolution of the Directors.
J. Paterson
Chai
rman
Melbourne
20 January 2021
11

PricewaterhouseCoopers, ABN 52 780 433 757
2 Riverside Quay, SOUTHBANK VIC 3006, GPO Box 1331, MELBOURNE VIC 3001
T: 61 3 8603 1000, F: 61 3 8603 1999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.

Auditor’s Independence Declaration
As lead auditor for the review of Australian Foundation Investment Company Limited for the half-year
ended 31 December 2020, I declare that to the best of my knowledge and belief, there have been:
(a)no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the review; and
(b)no contraventions of any applicable code of professional conduct in relation to the review.
This declaration is in respect of Australian Foundation Investment Company Limited and the entity it
controlled during the period.
Nadia Carlin Melbourne
Partner
PricewaterhouseCoopers
20 January 2021
12

CONSOLIDATED INCOME STATEMENT FOR THE HALF-YEAR ENDED 31
DECEMBER 2020
Note Half-year
2020
Half-year
2019
$’000 $’000
Dividends and distributions 93,837 153,929
Revenue from deposits and bank bills 95 1,109
Other revenue 2,278 2,423
Total revenue
96,210 157,461
Net gains/(losses) on trading portfolio
(1,009) 6,628
Income from operating activities 3 95,201 164,089
Finance & related costs (1,122) (462)
Administration expenses (5,958) (6,276)
Profit before income tax expense 88,121 157,351
Income tax expense(3,987) (11,250)
Profit for the half-year 84,134 146,101
Profit is attributable to :
Equity holders (members) of Australian Foundation
Investment Company Ltd
83,664 145,709
Minority Interest 470 392
84,134 146,101
Cents
Cents
Basic earnings per share 8 6.89 12.10
This Income Statement should be read in conjunction with the accompanying notes.
13

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE
HALF-YEAR ENDED 31 DECEMBER 2020
Half-Year to 31 December 2020
Half-Year to 31 December 2019
Revenue Capital Total
Revenue Capital Total
$’000 $’000 $’000
$’000 $’000 $’000
Profit for the half-year 84,134 - 84,134146,101 - 146,101
Other Comprehensive Income
Items that will not be recycled through the Income Statement
Gains for the period on equity securities in
the investment portfolio
- 908,353
908,353
- 219,411
219,411
Deferred tax on above - (274,013)
(274,013)
- (68,366)
(68,366)
Total other comprehensive income
1
- 634,340 634,340- 151,045 151,045
Total comprehensive
income
2
84,134 634,340 718,474 146,101 151,045 297,146
1
Net capital income not accounted for through the Income Statement
2
This is the company’s Net Return for the half-year, which includes the Net Profit plus the net realised and
unrealised gains or losses on the Company’s investment portfolio.
Half-Year to 31 December 2020
Half-Year to 31 December 2019
Revenue Capital Total Revenue Capital Total
$’000 $’000 $’000
$’000 $’000 $’000
Total Comprehensive Income is
attributable to:
Equity holders of Australian Foundation
Investment Company Ltd
83,664 634,340
718,004
145,709 151,045
296,754
Minority Interest 470 -
470
392 -
392
84,134 634,340 718,474 146,101 151,045 297,146
This Statement of Comprehensive Income should be read in conjunction w
ith the accompanying

notes.
14

CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2020
31 Dec 30 June
2020 2020
Note $’000 $’000
Current assets
Cash 103,222 111,318
Receivables 6,545 17,347
Trading portfolio
4
2,157 4,304
Tax refund due 3,802 -
Total current assets 115,726 132,969
Non-current assets
Investment portfolio 7,969,157 7,117,970
Deferred tax assets 4,119 872
Total non-current assets 7,973,276 7,118,842
Total assets 8,089,002 7,251,811
Current liabilities
Payables 1,427 884
Tax payable -30,771
Provisions 3,402 4,765
Total current liabilities 4,829 36,420
Non-current liabilities
Provisions 667 1,375
Deferred tax liabilities - investment portfolio
5
1,253,986 973,499
Total non-current liabilities 1,254,653 974,874
Total liabilities 1,259,482 1,011,294
Net Assets 6,829,520 6,240,517
Shareholders' equity
Share Capital
6
2,982,328 2,947,243
Revaluation Reserve 2,795,749 2,166,030
Realised Capital Gains Reserve 343,563 397,712
General Reserve 23,637 23,637
Retained Profits 683,151 705,273
Parent Entity Interest 6,828,428 6,239,895
Minority Interest 1,092 622
Total equity 6,829,520 6,240,517
This Balan
ce Sheet should be read in conjunction with the accompanying notes.
15

C
ONSOLIDATED
S
TATEMENT OF
C
HANGES IN
E
QUITY FOR THE
H
ALF
-Y
EAR ENDED
31

D
ECEMBER
2020

Attributable to members of Australian Foundation Investment Company
Ltd
Half-Year to 31 December 2020
Note
Share
Ca
pital
$’000
Revaluation
Reserve
$’000
Realised
Capital
Gains
$’000
General
Reserve
$’000
Retained
Profits
$’000
Total
Parent
Entity
$’000
Minority
Interest
$’000
Total
$’000
Total equity at the beginning of the half-year
2,947,243 2,166,030 397,712 23,637 705,273 6,239,895
622 6,240,517
Dividends paid
7
-
- (58,770)
- (105,786)
(164,556)
-
(164,556)
Shares issued - Dividend Reinvestment Plan
6
35,165 - - - -
35,165
-
35,165
Other Share Capital Adjustments
6
(80) - - - -
(80)
-
(80)
Total transactions with shareholders
35,085
- (58,770)
- (105,
786) (129,471)
- (129,471)
Profit for the half-year
-
-
-
- 83,664
83,664
470
84,134
Net gains for the period on equity securities in the investment portfolio
-
634,340
-
-
-
634,340
-
634,340
Other Comprehensive Income for the half-year
-
634,340
-
-
- 634,340
- 634,340
Transfer to Realised Capital Gains Reserve of net cumulative gains (after tax) on investments sold
-
(4,621)
4,621
-
-
-
-
-
Total equity at the end of the half-year
2,982,328 2,795,749 3
43,563 23,637 683,151 6,828,428 1,092 6,829,520
This Statement of Changes in Equity should be read in conjuncti
on with the accompanying notes.
16

C
ONSOLIDATED
S
TATEMENT OF
C
HANGES IN
E
QUITY FOR THE
H
ALF
-Y
EAR ENDED
31

D
EC
.

2019

(
CONT
)
Attributable to me
mbers of Aus
tralian Foundation Investment
Company Ltd
Half-Year to 31 December 2019
Note
Share

Capital
$’000
Revaluation
Reserve
$’000
Realised
Capital
Gains
$’000
General
Reserve
$’000
Retained
Profits
$’000
Total
Parent
Entity
$’000
Minority
Interest
$’000
Total
$’000
Total equity at the beginning of the half-year
2,888,136 2,561,314 462,257 23,637 688,244 6,623,588 1,158 6,6
24,746
Dividends
p
aid
7
-
-
(
58
,
625
)
-
(
105
,
525
)

(
164
,
150
)
-
(164,150)
Shar
es issued - Dividend Reinvestment Plan
34,407
-
-
-
-
34,407
-
34,407
Other Share Capital Adjustments
(76) - - - -
(76)
-
(76)
Total transactions with shareholders
34,331
- (58,625)
- (105,525) (129,819)
- (129,819)
Profit for the half-year
-
-
-
- 145,709
145,709
392
146,101
Other Comprehensive Income for the half-year Net gains for the period on equity securities in the investment portfolio
-
151,045
-
-
-
151,045
-
151,045
Other Comprehensive Income for the half-year
151,045
-
-
- 151,045
- 151,045
Transfer to Realised Capital Gains Reserve of net cumulative losses on investments sold
-
5,188 (5,188)
-
-
-
-
-
Total equity at the end of the half-year
2,922,467 2,717,547 3
98,444 23,637 728,428 6,790,523 1,550 6,792,073
This Statement of Changes in Equity should be read in conjuncti
on with the accompanying notes

17

CONSOLIDATED CASH FLOW STATEMENT FOR THE HALF-YEAR
ENDED 31 DECEMBER 2020
Half-yearHalf-year
2020 2019
$’000$’000
INFLOWS/ INFLOWS/
(OUTFLOWS) (OUTFLOWS)
Cash flows from operating activities
Sales from trading portfolio 12,258 34,371
Purchases for trading portfolio (687)(19,572)
Interest received 95 1,117
Dividends and distributions received 93,509 159,880
105,175 175,796
Othe
r receipts 2,279 2,419
Administration expenses (7,938) (7,230)
Finance costs paid (1,122) (462)
Taxes paid (12,036) (3,723)
Net cash inflow/(outflow) from operating activities 86,358 166,800
Cash flows from investing activities
Sales from investment portfolio 213,667 249,671
Purchases for investment portfolio (156,502) (294,272)
Taxes paid on capital gains (22,648) (20,101)
Net cash inflow/(outflow) from investing activities 34,517 (64,702)
Cash flows from financing activities
Share issue costs (80)(76)
Dividends paid (128,891) (129,427)
Net cash inflow/
(outflow) from financing activities (128,971) (129,503)
Net increase/(decrease) in cash held (8,096) (27,405)
Cash at the beginning of the half-year 111,318 206,429
Cash at the end of the half-year 103,222 179,024
This Cas
h Flow Statement should be read in conjunction with the accompanying notes.
18

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED
31 DECEMBER 2020
1. Basis of preparation of half-year financial report
This general purpose half-year financial report has been prepared in accordance with Accounting
Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001.
This interim financial report does not include all the notes of the type normally included in an
annual financial report. This report should be read in conjunction with the 2020 Annual Report
and public announcements made by the Group during the half-year, in accordance with the
continuous disclosure requirements of the Corporations Act 2001.
The accounting policies adopted are consistent with those of the previous financial year and
corresponding interim reporting period.
In the interests of transparency in its reporting, the Group uses the phrase “market value” in place
of the AASB terminology “fair value for actively traded securities.” The Company’s investments in
listed securities are valued at the closing price on the ASX on the last trading day before the
period end.
2. Financial reporting by segments
The Group consists of a Listed Investment Company and a subsidiary which provides
administration services to it and to other Listed Investment Companies in Australia. It has no
reportable business or geographic segments.
(a) Segment information provided to the Board
The internal reporting provided to the Board for the Group’s assets, liabilities and performance is
prepared on a consistent basis with the measurement and recognition principles of Australian
Accounting Standards, except that net assets are reviewed both before and after the effects of
capital gains tax on investments (as reported in the Group’s Net Tangible Asset announcements
to the ASX).
The relevant amounts as at 31 December 2020 and 31 December 2019 were as follows:
2020
$
2019
$
Net tangible asset backing per share
Before Tax 6.64 6.63
After Tax 5.61 5.63
(b) Other segment information
Segment Revenue
Revenues from external parties are derived from the receipt of dividend, distribution and interest
income, and income arising on the trading portfolio.
The Company is domiciled in Australia and the Group’s dividend and distribution income is
predominantly from entities which maintain a listing in Australia. The Group has a diversified
portfolio of investments, with only the Group’s investment in BHP comprising more than 10% of
the Group’s income (including trading portfolio) for the half-year ending 31 December 2020 –
10.6% (2019 : investment in Commonwealth Bank : 11.1%).
19

3. Income from operating activities
Half-year
2020
$'000
Half-year
2019
$'000
Income from operating activities is comprised of the following:
Dividends & distributions
securities held in investment portfolio
93,764 153,929
securities held in trading portfolio
73 -
93,837 153,929
Interest income
deposits and income from bank bills
95 1,109
95 1,109
Net gains/(losses) and write downs
net gains from trading portfolio sales
263 4,827
unrealised gains/(losses) in trading portfolio
(1,272) 1,801
(1,009) 6,628
Administrati
on fees received from other Listed Investment
Companies
2,176 2,201
Expenses recovered from other Listed Investment
Companies
38 136
Other expenses recovered 64 65
Sundry Income -21
95,201 164,089
4. Tradi
ng portfolio
As part of the activities of the trading portfolio, the Company enters into option contracts for the
purpose of enhancing returns, offsetting risk or providing opportunities to acquire or sell securities
at advantageous prices.
As at balance date there were call options outstanding which, if they were all exercised, would
require the Company to deliver securities to the value of $87.2 million (30 June 2020: $32.0
million).
20

5. Deferred tax liabilities – investment portfolio
In accordance with AASB 112 Income Taxes, deferred tax liabilities have been recognised for
Capital Gains Tax on the unrealised gain in the investment portfolio at current tax rates (30%)
totalling $1,254.0 million (30 June 2020 : $973.5 million). As the Directors do not intend to
dispose of the portfolio, this tax liability may not be crystallised at this amount.
6. Shareholders’ equity – share capital
Movements in Share Capital of the Company during the half-year were as follows:
Date Details Notes Number
of shares
’000
Issue
price
$
Paid-up
Capital
$’000
01/07/2020 Opening Balance
1,210,3642,947,243
01/09/2020 Dividend Reinvestment Plan
i
5,582
6.30
35,165
01/09/2020 Dividend Substitution Share Plan
ii
776
6.30
n/a
Various Other Share Capital adjustments -(80)
31/12/2020 Balance 1,216,7222,982,328
i The
Company has a Dividend Reinvestment Plan under which some shareholders elected to
have all or part of their dividend payment reinvested in new ordinary shares. Pricing of the
new DRP shares was based on the average selling price of shares traded on the Australian
Securities Exchange & Chi-X automated trading systems in the five days from the day the
shares begin trading on an ex-dividend basis.
ii The Company has a Dividend Substitution Share Plan under which some shareholders
elected to forego all or part of their dividend payment and receive shares instead. Pricing of
the new DSSP shares was done on the same basis as the DRP.
iii The Company introduced an on-market Buy-Back Programme in December 2000. This plan
remains active. No shares were bought back during the period.
7. Dividends
Half-year
2020
$’000
Half-year
2019
$’000
Dividends (fully franked) paid during the period 164,556 164,150
(excluding DSSP shares)
(14 cents per
share)
(14 cents per
share)
Dividends not recognised at period end
Since the end of the half-year the Directors have declared an
interim dividend of 10 cents per share, fully franked. The
aggregate amount of the proposed interim dividend expected to
be paid on 23 February 2021, but not recognised as a liability at
the end of the half-year is 121,672
21

8. Earnings per Share
Half-year
2020
Half-year
2019
Number Number
Weighted average number of ordinary shares used as the
denominator
1,214,545,486 1,204,301,645
$’000 $’000
Profit after tax for the half-year attributable to members of the
Company 83,664 145,709
Cents Cents
Basic earnings per share 6.89 12.10
There are no dilutive instruments on issue and consequently diluted earnings per share are the
same as basic earnings per share.
9. Events subsequent to balance date
Since 31 December 2020 to the date of this report there has been no event specific to the Group
of which the Directors are aware which has had a material effect on the Group or its financial
position.
10. Contingencies
At balance date Directors are not aware of any material contingent liabilities or contingent assets
other than those already disclosed elsewhere in the financial report.
22

DIRECTORS' DECLARATION
In the Director
s’ opinion:
(a) the financial statements and notes set out on pages 13 to 22 are in accordance with the
Corporations Act 2001, including:
(i) complying with Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting requirements; and
(ii) giving a true and fair view of the Group’s financial position as at 31 December 2020
and of its performance, as represented by the results of the operations, changes in
equity and cash flows, for the half-year ended on that date; and
(b) there are reasonable grounds to believe that the Company will be able to pay its debts
as and when they become due and payable.
This declaration is made in accordance with a resolution of the Directors.
J. Paterson
Chai
rman
Melbourne
20 January 2021
23

PricewaterhouseCoopers, ABN 52 780 433 757
2 Riverside Quay, SOUTHBANK VIC 3006, GPO Box 1331, MELBOURNE VIC 3001
T: 61 3 8603 1000, F: 61 3 8603 1999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Independent auditor's review report to the members of
Australian Foundation Investment Company Limited
Report on the half-year financial report
We have reviewed the accompanying half-year financial report of Australian Foundation Investment
Company Limited (the Company) and the entity it controlled during the half-year (together the Group),
which comprises the consolidated balance sheet as at 31 December 2020, the consolidated income
statement, consolidated statement of comprehensive income, consolidated statement of changes in
equity and consolidated cash flow statement for the half-year ended on that date, and the notes to the
financial statements and the directors’ declaration.
Directors' responsibility for the half-year financial report
The directors of the Company are responsible for the preparation of the half-year financial report that
gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the directors determine is necessary to enable the preparation of
the half-year financial report that gives a true and fair view and is free from material misstatement
whether due to fraud or error.
Auditor's responsibility
Our responsibility is to express a conclusion on the half-year financial report based on our review. We
conducted our review in accordance with Australian Auditing Standard on Review Engagements ASRE
2410 Review of a Financial Report Performed by the Independent Auditor of the Entity, in order to
state whether, on the basis of the procedures described, we have become aware of any matter that makes
us believe that the half-year financial report is not in accordance with the Corporations Act 2001
including giving a true and fair view of the Group's financial position as at 31 December 2020 and its
performance for the half-year ended on that date; and complying with Accounting Standard AASB 134
Interim Financial Reporting and the Corporations Regulations 2001. As the auditor of Australian
Foundation Investment Company Limited, ASRE 2410 requires that we comply with the ethical
requirements relevant to the audit of the annual financial report.
A review of a half-year financial report consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with Australian Auditing Standards
and consequently does not enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Independence
In conducting our review, we have complied with the independence requirements of the Corporations
Act 2001.
24

Conclusion
Based on our review, which is not an audit, we have not become aware of any matter that makes us
believe that the half-year financial report of Australian Foundation Investment Company Limited is not
in accordance with the Corporations Act 2001 including:
1.giving a true and fair view of the Group's financial position as at 31 December 2020 and of its
performance for the half-year ended on that da
te;
2.complying with Accounting Standard AASB 134 Interim Financial Reporting and the
Corporations Regulations 2001.
PricewaterhouseCoopers
Nadia Carlin Melbourne
Partner 20 January 2021
25