Information Meetings – Presentation

13 March 2024


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
Information Meetings – Presentation


Dear Sir / Madam


Please find attached the presentation to be given at the Information Meetings being
held in March 2024.


Yours faithfully


Matthew Rowe
Company Secretary

ASX Release authorised by the Company Secretary.

Shareholder Meeting
March 2024

Shareholder Meeting / March 2024
Australian Foundation Investment Company Limited and its subsidiary (AICS) (AFSL 303209), its
related entities and each of its respective directors, officers and agents (together the Disclosers)
have prepared the information contained in these materials in good faith. However, no warranty
(express or 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
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Shareholder Meeting / March 2024
Overview and Investment Objectives Mark Freeman
Markets and the Portfolio David Grace and Nga Lucas
Outlook David Grace
Agenda
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Shareholder Meeting / March 2024
Overview and Investment
Objectives

Shareholder Meeting / March 2024
Invests in Australian and New Zealand companies
Largest listed investment company on the ASX, over 160k shareholders, independent Board of Directors
Shareholders own the ‘management rights’ to the portfolio
Management expense ratio of 0.14% with no additional fees
Long term investor with low turnover (tax effective). Portfolio and share price returns less volatile than the index
Long history of growing/stable fully franked dividends
Team manages three other funds – Djerriwarrh, Mirrabooka and AMCIL
Our Company
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Shareholder Meeting / March 2024
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 provide attractive total returns over
the medium to long term; and
• to pay dividends which, over time, grow
faster than the rate of inflation.
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Shareholder Meeting / March 2024
Attractive Total Returns over the Long-term
AFIC NTA vs ASX 200 Accumulation Index
$10k in AFIC  $152k
$10k in the Index  $123k
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Excludes the benefit of franking

Shareholder Meeting / March 2024
Ensuring a Consistent to Growing Dividend for Shareholders
AFIC’s franking reserve
balance ensures we can
pay a consistent dividend
even through volatile
times – full year dividends
last five financial years.
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AFIC’s franking reserve balance ensures we can pay a consistent dividend even through
volatile times – full year dividends last 5 financial years
In 2019 AFIC also paid a special fully franked dividend of 8 cents per share

Shareholder Meeting / March 2024
Share Price Relative to NTA
29 Feb 2024
NTA: $7.77
Share price: $7.39
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Shareholder Meeting / March 2024
Markets and the Portfolio
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Shareholder Meeting / March 2024
February 2024 Reporting Season Review
Overall reported company results were in line or slightly ahead of market expectations.
Revenue growth is slowing but margins are proving resilient as corporates cut costs.
Increasing risk of regulation for large consumer facing companies as the cost of living
remains elevated.
Balance sheets remain in strong shape.
Increasingly, companies are looking to acquisitions to deliver earnings growth.
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Shareholder Meeting / March 2024
Valuation in a Long Term Context
Price to Sales – S&P/ASX 200 Index
Price to Book – S&P/ASX 200 Index
Average1.9
Average 1.9
Source: FactSet
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Shareholder Meeting / March 2024
Portfolio* and Sector Performance to 29 February 2024
12 Month Sector Performance
* Per annum returns. Assumes the full benefit of franking credits.
Past performance is not indicative of future performance.
Includes dividends but not franking.
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Shareholder Meeting / March 2024
Portfolio Set to Perform in Most Economic Settings
AFIC
Stalwarts
Growth Companies
IncomeCyclicals
14
16%
34%
24%
26%

Shareholder Meeting / March 2024
Quality Growth Companies
Growth Companies
Structural growth companies in large growing markets
Generate free cash flow that is reinvested in growth and efficiency
Strong customer proposition driving share gains
CSL - Plasma, capital allocation, capacity and efficiency
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Xero - Cloud accounting software, global opportunity, focused
efficient growth
16%
34%
24%
26%

Shareholder Meeting / March 2024
Quality Stalwart Companies
Stalwart Companies
Highly strategic, difficult to replicate assets with a market
leadership position.
Consistent earnings growth leading to a growing dividend profile.
Wesfarmers – Bunnings, Kmart, Industrial and Healthcare
Transurban – Core road network in markets with population
growth
16
16%
34%
24%
26%

Shareholder Meeting / March 2024
Quality Income Companies
Income Companies
Regulatory or asset-based barriers against new entrants.
Attractive dividend profile (preferably fully franked) with modest
earnings growth.
Strong balance sheets
Banks – benign bad debt environment, secure dividend
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Telstra – mobile growth, improving returns, infrastructure assets
16%
34%
24%
26%

Shareholder Meeting / March 2024
Quality Cyclical Companies
Cyclical Companies
Long life assets with low costs to operate.
Ability to generate a meaningful return in low points of the cycle.
Balance sheets in strong shape with the ability to invest in
growth projects as they emerge.
BHP & RIO. High cash generation. Maturing end market demand.
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16%
34%
24%
26%

Shareholder Meeting / March 2024
Active Portfolio Management – Recent Transactions
New Purchases
Trimmed Holdings
Additions to Existing Holdings
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Shareholder Meeting / March 2024
Outlook

Shareholder Meeting / March 2024
Outlook
The rate of inflation is declining yet the cost of living remains elevated.
Challenging environment for companies to deliver meaningful near term earnings
growth.
We remain focused on companies well positioned to create long term shareholder
value.
The portfolio is invested in well managed companies with proven track records of
financial discipline capturing value-accretive opportunities as they arise.
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