Interim Results Webcast Presentation

20 January 2021


The Manager
ASX Market Announcements
Australian Securities Exchange
Exchange Centre
Level 4
20 Bridge Street
Sydney NSW 2000

Electronic Lodgement



Australian Foundation Investment Company Limited
Interim Results Webcast Presentation

Please find attached the presentation to be given at the Shareholder Teleconference/
Webcast being held today, Wednesday 20 January 2021 at 4.00 p.m. (AEDT)

To join the webcast please use the below link (also available on the afi.com.au
website).

Webcast Link: Please register for the results webcast here (This link will open directly
in your internet browser).

Alternatively to join via the teleconference, please use the details below:

Telephone: 1800 175 864 (free call within Australia)
1300 212 365 (mobile, free call within Australia)
+61 2 8373 3550 (outside Australia)

Conference ID: 5088347

Joining the Conference Call:

1. In the 10 minutes prior to the call start time, call the appropriate dial-in number.
2. Enter the Event Plus passcode 5088347, followed by the pound or # key and leave
any information requested after the tone. You will be joined automatically to the
conference. During the call you can indicate if you would like to ask a question by
pressing (*1) on your telephone keypad and wait for your name to be announced.


International Dial-In Numbers and shareholder presentation material will be available
via the Company’s website www.afi.com.au.

ASX Release authorised by the Company Secretary, Matthew Rowe.

Interim Results
Presentation
20 January 2021

Australian Foundation Investment Company Limited and its subsidiary AICS (AFSL 303209), their
related entities and each of their respective directors, officers and agents (together the Disclosers)
have prepared the information contained in these materials in good faith. However, no warranty
(express or implied) is made as to the accuracy, completeness or reliability of any statements, estimates
or opinions or other information contained in these materials (any of which may change without notice)
and to the maximum extent permitted by law, the Disclosers disclaim all liability and responsibility
(including, without limitation, any liability arising from fault or negligence on the part of any or all of the
Disclosers) for any direct or indirect loss or damage which may be suffered by any recipient through
relying on anything contained in or omitted from these materials.
This information has been prepared and provided by AICS. To the extent that it includes any financial
product advice, the advice is of a general nature only and does not take into account any individual’s
objectives, financial situation or particular needs. Before making an investment decision an individual
should assess whether it meets their own needs and consult a financial advisor.
Disclaimer
2

Our Company
Invests in Australian and New Zealand companies – looking for quality for the long term.
Largest listed investment company on the ASX at $8.1bn (also listed on NZX), 160k shareholders, full transparency
through being listed, independent Board of Directors providing strong governance.
Shareholders own the ‘management rights’ to the portfolio – no external funds management business deriving
an income from the portfolio.
Management expense ratio of 0.10% (annualised at 31/12/2020), no performance fees.
Long term investor with low portfolio turnover – tax has less of a negative impact on shareholder returns compared with
high turnover funds.
Long history of growing/stable fully franked dividends.
Team manages three other funds – Djerriwarrh, Mirrabooka and AMCIL which adds significantly to the effectiveness
of the investment process and idea generation.
3

Investment Objectives
The Company aims to provide
shareholders with attractive investment
returns through access to a growing
stream of fully franked dividends
and growth in capital invested.
The Company’s primary investment goals are:
• to pay dividends which, over time, grow
faster than the rate of inflation; and
• to provide attractive total returns over
the medium to long term.
4

Interim Result Summary – 6 months to 31 December 2020
* Assumes a shareholder can take full advantage of the franking credits.
5

Sustainable competitive
advantage – unique
assets producing strong
returns on capital
AFIC offers a diversified portfolio of quality stocks – what we look for
Strong management
team and board
Recurring, predictable
earnings are preferred
Financial strength
– strong cash flow
and balance sheet
6

Businesses that can
grow over the long
term, producing
growing dividends
AFIC offers a diversified portfolio of quality stocks – what we look for
continued
Nursery stocks
– developing the
preceding attributes
Look to buy when we
see long term value
7

Market and Selected Sector Performances
S&P/ASX 200 Index
Selected Sector Performance
8

Relative portfolio performance, including franking*
– returns to 31 December 2020
AFIC portfolio returns have a lower
level of volatility (Beta of 0.91) than
the Index.
Returns include growing/stable
fully franked dividends over
a 10 year period.
9
* Assumes an investor can take full advantage of the franking credits.
Per annum returns other than for 6 months. Past performance is not indicative of future performance.

Winners and losers* – 6 months to 31 December 2020
10
Losers
Missed
Winners
* Percentage gain/loss over the period.

Major portfolio changes
Purchases
Sales
Included participation in placement
New Additions
in the half
11
Top up transactions
for the half
Transactions that demonstrate
the investment process
Included participation in placement

Top 30 holdings – 31 December 2020
Rank Company% of Portfolio
1
Commonwealth Bank of Australia8.1%
2
CSL 7.7%
3
BHP Group* 7.4%
4
Wesfarmers 4.7%
5
Transurban Group 4.1%
6
Westpac Banking Corporation3.8%
7
Macquarie Group 3.8%
8
National Australia Bank* 3.4%
9
Woolworths Group 3.1%
10
Rio Tinto* 2.9%
* Options were outstanding against part of the holding.
Total Portfolio 61 Holdings
12

Top 30 holdings – 31 December 2020
continued
Rank Company% of Portfolio
11
Mainfreight 2.7%
12
Australia and New Zealand Banking Group 2.4%
13
Amcor2.2%
14
James Hardie Industries*2.2%
15
Sydney Airport*2.1%
16
Telstra Corporation 2.0%
17
Brambles 1.6%
18
Coles Group 1.6%
19
Xero 1.6%
20
Goodman Group1.6%
Total Portfolio 61 Holdings
13
* Options were outstanding against part of the holding.

Top 30 holdings – 31 December 2020
continued
Rank Company% of Portfolio
21
Sonic Healthcare 1.5%
22
Ramsay Health Care 1.5%
23
Seek 1.5%
24
Reece 1.5%
25
ResMed1.4%
26
ARB Corporation 1.4%
27
Fisher & Paykel Healthcare1.4%
28
Qube Holdings 1.3%
29
Carsales.com 1.3%
30
NextDC1.2%
Total Portfolio 61 Holdings
14

The onset
of COVID-19
means low
interest rates
and significant
government
stimulus for the
foreseeable
future.
Full impact
of economic
conditions
on company
earnings and
dividends still
to play out.
Difficult to reconcile
expansion of market
valuations, although
it is being driven by
a small number of
stocks – particularly
Information
Technology and
Healthcare.
We believe the
portfolio is well
positioned given
the quality of
the holdings
and further
adjustments
made through
the March/April
downturn.
New administration
in the US and
Australia's position
with China may
provide further
volatility.
We can remain
patient.
Outlook
15

Questions
16