Half Yearly Report and Accounts as at 31 December 2024

Australian Foundation Investment Company Limited



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
2024 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
1

Australian Foundation Investment Company Limited
Results for Announcement to the Market
The reporting period is the half year ended 31 December 2024, with the prior corresponding period being
the half year ended 31 December 2023.
The half year financial report has been reviewed by the Company’s auditors.
> Profit after tax was $154.2 million, up 2.7% on
the previous corresponding period’s $150.1
million.
> Profit after tax attributable to members was
$154.2 million (up 2.8% on the previous
corresponding period’s $150.0 million).
> Revenue from operating activities was $173.5
million, up $5.1 million or 3.0% from the previous
corresponding period. This excludes capital
gains on investments.
> Investment income for the six months to 31
December 2024 was $166.3 million, up from
$162.7 million in the corresponding period last
year. The increase was largely because of a
special dividend from Woolworths Group and
increased holdings in BHP, Woodside Energy
Group and Telstra Group over the course of the
calendar year. These dividend increases offset
the lower contribution from major bank dividends
as holdings were reduced through the period.
> The interim dividend is 12.0 cents per share, fully
franked, up 0.5 cents from the previous
corresponding period. The dividend will be paid
on 25 February 2025 to ordinary shareholders on
the register on 4 February 2025, and the shares
are expected to commence trading on an ex-
dividend basis on 3 February 2025. There is no
conduit foreign income component of the
dividend. No LIC gains are attached to the
interim dividend.
> A Dividend Reinvestment Plan (DRP) and
Dividend Substitution Share Plan (DSSP) are
available, the price for which will be set at a nil
discount to the Volume Weighted Average Price
of the Company’s shares traded on the ASX and
Cboe 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 and
DSSP is 5pm (AEDT) on 5 February 2025.
> The final dividend for the 2024 financial year was
14.5 cents per share (fully franked), and it was
paid to shareholders on 30 August 2024.
> Portfolio return for the half year was 7.2%,
including franking. The return for the S&P/ASX
200 Accumulation Index was 7.6% including
franking over this period. In the 12 months to 31
December 2024 the portfolio return was 13.2%,
ahead of the S&P/ASX 200 Accumulation Index
return over this period including franking of
12.7%. AFIC’s performance returns are after
costs.
> 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 2024 were $8.24, up from $7.62 at 31
December 2023 (both before allowing for any
announced dividends).
> The Company will be providing an update on
these results via a webcast for shareholders on
Wednesday 22 January 2025 at 3.30 p.m.
(AEDT). Details are on the website at afi.com.au.
2

Australian Foundation Investment Company Limited
12-month portfolio return outperforms in strong market
conditions. Increase in the interim dividend.
Half Year Report to 31 December 2024
AFIC’s investment focus is on a diversified portfolio of Australian equities, seeking to
provide attractive income and capital growth to shareholders over the medium to long
term. This is achieved at a low cost, with lower volatility than the market, and with low
portfolio turnover which produces tax-effective outcomes for shareholders. AFIC’s
management expense ratio is 0.15% (annualised) with no additional fees.
Half Year Profit was $154.2 million. In the corresponding period last year, Half Year Profit was $150.1
million.
Earnings per share for the half year was 12.3 cents per share. The interim dividend declared is 12.0 cents
per share fully franked, an increase from 11.5 cents per share from the corresponding period last year.
Increasing the interim dividend is in line with our long term objective of seeking to equalise the quantum of
the interim and final dividends over time.
During the period a significant amount of realised taxable gains were incurred from sales as market
valuations became stretched and some portfolio positions were reduced. The largest sale in this context
was a small proportion of the holding in the Commonwealth Bank of Australia. These sales
will
generate
franking credits from the tax payable on these transactions which further reinforces AFIC’s franking
reserves. However, the trimming of portfolio positions where tax is payable also impacts
reported portfolio
returns as AFIC’s performance is reported after tax paid and costs.
Portfolio return for the half year was 7.2%, including franking. The return for the S&P/ASX 200
Accumulation Index was 7.6% including franking over this period. In the 12 months to 31 December 2024
the portfolio return was 13.2%, ahead of the S&P/ASX 200 Accumulation Index return over this period
including franking of 12.7%.
Portfolio return* (including the full benefit of franking) to 31 December 2024.
*Per annum returns other than for six months. AFIC’s performance figures are after costs and tax.
Past performance is not indicative of future performance.
3

Australian Foundation Investment Company Limited
Market Commentary and Portfolio
Performance
The S&P/ASX 200 Accumulation Index including
the benefit of franking, rose 12.7% in the calendar
year to 31 December 2024 driven by the very
strong performance of the Information Technology
and Banking sectors. Throughout the year,
valuations in both sectors saw a significant re-
rating higher in price earnings multiples as investor
confidence increased around their perceived lower
earnings risk relative to the broader market. Both
sectors ended the year with valuations at very high
levels. The Resources sector underperformed in
2024 as softening demand from China significantly
weighed on commodity prices. To date, China’s
easing policy stance is yet to materialise in
accelerating economic growth.
AFIC’s portfolio outperformed the Index with a
return of 13.2% including franking for the 12
months to 31 December 2024 (return figures
including franking only include the benefit of
franking which AFIC has distributed to
shareholders).
The portfolio relative outperformance over the
twelve-month period can be largely attributed to
holdings in Netwealth Group, Fisher & Paykel
Healthcare, ResMed, Wesfarmers, JB Hi-Fi,
Goodman Group and Macquarie Group.
Meaningful detractors to performance came from
IDP Education, Domino’s Pizza Enterprises, and
long-term core holdings James Hardie Industries
and Transurban Group.
The underweight portfolio position in the Resources
sector, which has underperformed, also contributed
to relative outperformance. It has been a conscious
decision to be underweight in this sector for some
time given our concerns about the outlook for
growth in China.
Five and 10-year portfolio return figures to 31
December 2024 including franking were 9.7% and
9.4% per annum respectively. The S&P/ASX 200
Accumulation Index over these corresponding
periods including franking were 9.4% and 10.0%
per annum. These figures include the full benefit
of franking, with AFIC’s return after costs. This
performance has been achieved with lower
portfolio volatility than the market and more
consistent dividend income.
Portfolio Adjustments
During the year, we increased our holdings in BHP,
Woodside Energy Group, Telstra Group, Cochlear,
James Hardie Industries and WiseTech Global.
We consider long term prospects for all these
companies remains strong. These purchases were
transacted during periods of short term negative
news flow, providing attractive buying opportunities
for long term investors. All these companies hold
strong market positions and generate meaningful
free cash flow enabling reinvestment into their
asset base for future earnings growth.
We initiated positions in five companies during the
12 month period: Ampol, Worley, Macquarie
Technology, BlueScope Steel, and Sigma
Healthcare. Ampol is Australia’s leading integrated
energy company engaged in refining, supply and
marketing of petroleum and maintains a significant
convenience retail footprint. Worley is a market
leader in engineering and consulting services to the
global energy, chemical and resources industries.
Macquarie Technology is a data centre, cloud and
telecommunications business. BlueScope Steel is
a global leader in metal coating and painting
products servicing a wide range of end markets
and Sigma Healthcare operates in wholesale and
community pharmacy with a proposed merger with
Chemist Warehouse, a market leader in operating
retail pharmacies.
We exited Ramsay Health Care as significant
structural changes in the industry are likely to
continue to undermine their competitive position,
and Domino’s Pizza Enterprises considering their
long-term prospects appear to be increasingly
challenged. Mineral Resources was sold because
of the disappointing corporate governance
practices that have emerged.
International Portfolio
We have continued to manage the global portfolio
(within the AFIC portfolio) over the period. This
portfolio was first initiated in May 2021. We have
been trialling this portfolio for over three years.
AFIC has invested a total of $106.8 million of
shareholder capital in the global portfolio, which is
valued at $164.2 million as at 31 December, 2024.
At current value, the global portfolio represents
about 1.6% of the overall AFIC portfolio.
4

Australian Foundation Investment Company Limited

We are encouraged by the performance of this
portfolio which has exceeded its benchmark index
(the MSCI World Index ex Australia) since its
inception.
We are currently working through the most
appropriate next steps for this initiative, including
the options for establishing a separate low-cost
global investment company in the future.
Outlook
The outlook for equity markets remains highly
uncertain. Heightened geopolitical tensions
coupled with election outcomes in many developed
markets may lead to a wide dispersion of potential
investment outcomes in the near term. Accordingly,
equity market volatility is expected to remain a
feature.
The operating environment for many companies
appears set to become increasingly challenged.
Sales growth appears set to slow as economic
growth and consumer confidence remain subdued
while cost inflation remains elevated, albeit now
growing at a slower rate.
Following two strong years of performance, the
Australian equity market now appears more fully
priced. In this environment, we are cautiously
allocating capital as the price you pay for any
investment plays a large role in investment returns,
even over extended time periods.
As long term investors, we are looking to utilise
prevalent share price volatility to allocate capital to
quality companies at attractive prices, where long
term growth prospects remain strong. Our focus
remains on quality companies that maintain a
strong balance sheet, operate unique assets and
are run by highly capable boards and management
teams.
Please direct any enquiries to:


Mark Freeman Geoff Driver
Managing Director General Manager
(03) 9225 2101 (03) 9225 2102



22 January 2025
5

Australian Foundation Investment Company Limited
Major Transactions in the Investment Portfolio (6 months to end
December 2024)
Acquisitions
Cost

($’000)
BHP 95,416
Worley 45,163
BlueScope Steel 27,868

Ampol 21,905
Cochlear 20,310

Disposals
Proceeds

($’000)

Commonwealth Bank of Australia 190,178
Ramsay Health Care* 51,040
Mineral Resources* 35,342

Westpac Banking Corporation 35,089
Domino’s Pizza Enterprises* 31,879
*Complete disposal from the portfolio.

New Companies Added to the Portfolio
Worley
BlueScope Steel
Sigma Healthcare

6

Australian Foundation Investment Company Limited

Top 25 Investments at 31 December 2024
Includes investments held in both the investment and trading portfolios.
Value at Closing Prices at 31 December 2024

Total Value

$ Million
% of the
Portfolio
1
Commonwealth Bank of Australia 975.4

9.7%

2
BHP Group 820.8

8.1%

3
CSL 722.0

7.2%

4
Macquarie Group* 476.0 4.7%
5
National Australia Bank* 457.3

4.5%

6
Wesfarmers 454.2

4.5%

7
Westpac Banking Corporation 429.3

4.3%

8
Transurban Group 363.3

3.6%

9
Goodman Group 361.9 3.6%
10
Telstra Group 262.5

2.6%

11
James Hardie Industries 229.2

2.3%

12
Rio Tinto 218.7

2.2%

13
ResMed 214.8

2.1%

14
ANZ Group Holdings 211.6 2.1%
15
CAR Group* 205.0

2.0%

16
Woolworths Group 203.3

2.0%

17
Woodside Energy Group 200.9

2.0%

18
Coles Group* 183.4

1.8%

19
Mainfreight 160.0 1.6%
20
ARB Corporation
150.5

1.5%

21
Amcor
144.0

1.4%

22
Xero 140.7

1.4%

23
REA Group 134.6

1.3%

24
Reece 126.0 1.2%
25
Fisher & Paykel Healthcare 125.8

1.2%

Total

7,971.1

As percentage of total portfolio value (excludes cash)

79.0%
* Indicates that options were outstanding against part of the holding.

7

Australian Foundation Investment Company Limited

Portfolio Performance to 31 December 2024
Performance Measures to 31 December 2024 6 Months

1 Year

3 Years

% pa

5 Years

% pa

10 Years

% pa

Portfolio Return – Net Asset Backing Return
Including Dividends Reinvested

6.4%


11.7%


5.5%


8.1%


7.7%

S&P/ASX 200 Accumulation Index 6.9%

11.4%

7.4%

8.1%

8.5%



Portfolio Return – Net Asset Backing Gross
Return Including Dividends Reinvested*

7.2%


13.2%


7.0%


9.7%


9.4%

S&P/ASX 200 Gross Accumulation Index* 7.6%

12.7%

8.9%

9.4%

10.0%

* Incorporates the benefit of franking credits for those who can fully utilise them.
Note: AFIC net asset per 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.

8

AUSTRALIAN
FOUNDATION
INVESTMENT
COMPANY
LIMITED
ABN 56 004 147 120








HALF-YEAR REPORT
31 DECEMBER 2024




9

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:
Craig M. Drummond, Chairman
Rebecca P. Dee-Bradbury
Julie A. Fahey
Katie M. Hudson
Graeme R. Liebelt
Richard L. Murray
David A. Peever
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
invest@afi.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: MUFG Corporate Markets (AU) Limited
Mail Address:

AFIC Shareholder
enquiry lines :

E-mail:
Facsimile:
Internet:
Locked Bag A14, Sydney South, NSW, 1235

1300 857 499 (Aus)
+64 9375 5998 (NZ)

afi@cm.mpms.mufg.com
(02) 9287 0303
au.investorcentre.mpms.mufg.com

For all enquiries relating to shareholdings, dividends and related matters, please
contact the share registrar.

Securities Exchange
Codes:

AFI Ordinary shares (ASX and NZX)


10

DIRECTORS' REPORT

The Directors present their report in relation to the half-year to 31 December 2024 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:

C.M. Drummond (appointed July 2021, appointed Chairman October 2023)
R.P. Dee-Bradbury (appointed May 2019)
J.A. Fahey (appointed April 2021)
K.M. Hudson (appointed January 2024)
G.R. Liebelt (appointed June 2012)
R.L. Murray (appointed January 2024)
D.A. Peever (appointed November 2013)
R.M. Freeman (appointed January 2018)

Review of the Group's operations and results
Overview
AFIC’s investment focus is on a diversified portfolio of primarily Australian equities. 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 $154.2 million, up 2.7% from the previous corresponding period.
The net profit per share for the six months to 31 December 2024 was 12.3 cents per share with an
interim dividend declared of 12.0 cents per share fully-franked, an increase of 0.5 cents on the
previous corresponding period.
The portfolio return for the 6 months (measured by change in net asset backing per share plus
dividends reinvested) was 6.4% compared to the return of the S&P/ASX 200 Accumulation Index
for the same period which was 6.9%. 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 $39.5 million of capital (after costs). In addition, 4.8 million shares were bought back
under the Company’s on-market buy-back programme.


11

Auditors’ independence declaration
A copy of the auditors’ independence declaration as required under section 307C of the
Corporations Act 2001 is set out on page 13.

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.



C.M. Drummond
Chairman

Melbourne
22 January 2025

12

13

CONSOLIDATED INCOME STATEMENT FOR THE HALF-YEAR ENDED 31
DECEMBER 2024
Note

Half-year
2024

Half-year

2023

$’000 $’000

Dividends and distributions 166,298

162,673

Revenue from deposits and bank bills 4,126

3,263

Other revenue 3,113

2,491


Total revenue
173,537


168,427


Net gains/(losses) on trading portfolio
1,892


1,332


Income from operating activities 3 175,429 169,759

Finance & related costs (631)

(700)

Administration expenses (10,900)

(8,691)

Profit before income tax expense

163,898

160,368

Income tax expense (9,734)

(10,289)

Profit for the half-year 154,164

150,079



Profit is attributable to :
Equity holders (members) of Australian Foundation
Investment Company Ltd
154,162

149,997

Minority Interest 2

82


154,164 150,079


Cents

Cents
Basic earnings per share 8


12.29

12.05






This Income Statement should be read in conjunction with the accompanying notes.

14

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE
HALF-YEAR ENDED 31 DECEMBER 2024


Half-Year to 31 December 2024
Half-Year to 31 December 2023

Revenue Capital Total
Revenue

Capital

Total


$’000 $’000 $’000
$’000

$’000

$’000


Profit for the half-year 154,164 - 154,164 150,079 - 150,079


Other Comprehensive Income
Items that will not be recycled through the Income Statement

Gains for the period on equity securities in
the investment portfolio
-
531,401
531,401

-

582,535582,535

Tax on above -
(162,605)(162,605)
-

(176,807)
(176,807)
Total other comprehensive income
1
-
368,796
368,796

-

405,728 405,728



Total comprehensive income
2
154,164
368,796
522,960

150,079

405,728 555,807


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 2024
Half-Year to 31 December 2023

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
154,162

368,796

522,958

149,997

405,728

555,725

Minority Interest 2

-
2
82

-
82

154,164 368,796 522,960

150,079 405,728 555,807



This Statement of Comprehensive Income should be read in conjunction with the accompanying notes.


15

CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2024

31 Dec

30 June


2024

2024

Note $’000 $’000
Current assets

Cash

294,114

166,499

Receivables

12,775

42,425

Trading portfolio
4
5,641

5,387

Total current assets 312,530 214,311

Non-current assets

Deferred tax assets - other 1,328

-

Investment portfolio 10,081,228

9,703,558

Total non-current assets 10,082,556 9,703,558

Total assets 10,395,086 9,917,869


Current liabilities

Payables

1,661

1,256

Borrowings – bank debt 10,000 10,000
Tax payable

53,093

34,105

Provisions

4,389

6,014

Total current liabilities 69,143 51,375


Non-current liabilities

Provisions 151 154
Deferred tax liabilities - other

-

1,237

Deferred tax liabilities - investment portfolio
5
1,712,903

1,603,716

Total non-current liabilities 1,713,054 1,605,107


Total liabilities 1,782,197 1,656,482

Net Assets 8,612,889 8,261,387


Shareholders' equity

Share Capital
6
3,208,290

3,204,950

Revaluation Reserve

3,679,098

3,449,280

Realised Capital Gains Reserve

631,683

546,953

General Reserve 23,637 23,637
Retained Profits

1,068,406

1,034,794

Parent Entity Interest 8,611,114 8,259,614
Minority Interest 1,775

1,773

Total equity 8,612,889 8,261,387



This Balance Sheet should be read in conjunction with the accompanying notes.
16

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2024


Attributable to members of Australian Foundation Investment Company
Ltd

Half-Year to 31 December 2024


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

3,204,950

3,449,280

546,953

23,637

1,034,794

8,259,614

1,773

8,261,387

Dividends paid
7
-

-

(54,248) -

(120,550)
(174,798)
-
(174,798)
Shares issued - Dividend Reinvestment Plan
6
39,650

-

-

-

-
39,650
-
39,650
Shares bought-back
6
(36,156)

-

-

-

-
(36,156) (36,156)
Other Share Capital Adjustments
6
(154)

-

-

-

-
(154)
-
(154)
Total transactions with shareholders

3,340

-

(54,248)

-

(120,550)

(171,458)

-

(171,458)

-
Profit for the half-year

-

-

-

-

154,162
154,162
2
154,164


Net gains for the period on equity securities in
the investment portfolio - 368,796 - - - 368,796 - 368,796
Other Comprehensive Income for the half-
year

-

368,796

-

-

-

368,796

-

368,796

Transfer to Realised Capital Gains Reserve
of net cumulative gains (after tax) on
investments sold

-

(138,978)

138,978

-

-
-
-
-


Total equity at the end of the half-year

3,208,290

3,679,098

631,683

23,637

1,068,406

8,611,114

1,775

8,612,889


This Statement of Changes in Equity should be read in conjunction with the accompanying notes.



17

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2023


Attributable to members of Australian Foundation Investment Company
Ltd
Half-Year to 31 December 2023


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

3,136,282

2,926,191

509,741

23,637

960,171

7,556,022

1,534

7,557,556

Dividends paid
7
- - (83,588) - (83,588) (167,176) -
(167,176)
Shares issued - Dividend Reinvestment Plan

37,121

-

-

-

-
37,121
-
37,121
Other Share Capital Adjustments

(90)

-

-

-

-
(90)
-
(90)
Total transactions with shareholders

37,031

-

(83,588)

-

(83,588)

(130,145)

-

(130,145)

Profit for the half-year

-

-

-

-

149,997

149,997

82
150,079
Other Comprehensive Income for the half-year



Net gains for the period on equity securities in
the investment portfolio

-

405,728

-

-

-
405,728
-
405,728
Other Comprehensive Income for the half-
year

-

405,728

-

-

-

405,728

-

405,728

Transfer to Realised Capital Gains Reserve
of net cumulative gains (after tax) on
investments sold

-

(59,469)

59,469

-

-
-
-
-


Total equity at the end of the half-year 3,173,313 3,272,450 485,622 23,637 1,026,580 7,981,602 1,616 7,983,218
This Statement of Changes in Equity should be read in conjunction with the accompanying notes


18

CONSOLIDATED CASH FLOW STATEMENT FOR THE HALF-YEAR
ENDED 31 DECEMBER 2024
Half-year Half-year
2024 2023
$’000 $’000
INFLOWS/ INFLOWS/

(OUTFLOWS) (OUTFLOWS)
Cash flows from operating activities
Sales from trading portfolio 11,225 10,229
Purchases for trading portfolio

(9,586)

(6,240)

Interest received

4,215

3,340

Dividends and distributions received

194,598

190,537



200,452

197,866





Other receipts

3,108

2,470

Administration expenses (12,360) (10,903)
Finance costs paid

(631)

(700)

Taxes paid

(14,227)

(13,876)

Net cash inflow/(outflow) from operating activities

176,342

174,857

Cash flows from investing activities

Sales from investment portfolio

479,038

332,260

Purchases for investment portfolio

(325,306)

(281,529)

Taxes paid on capital gains (31,287) (26,246)
Net cash inflow/(outflow) from investing activities

122,445

24,485



Cash flows from financing activities

Share issue costs

(154)

(90)

Shares bought-back (36,156) -
Dividends paid

(134,862)

(129,557)

Net cash inflow/(outflow) from financing activities (171,172)

(129,647)

Net increase/(decrease) in cash held

127,615

69,695

Cash at the beginning of the half-year 166,499 165,385
Cash at the end of the half-year

294,114

235,080












This Cash Flow Statement should be read in conjunction with the accompanying notes.

19

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED
31 DECEMBER 2024
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 half-year 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 2024 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 2024 and 31 December 2023 were as follows:
2024

$



2023

$

Net tangible asset backing per share

Before Tax 8.24

7.62

After Tax 6.87

6.40



(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 two investments comprising more than 10% of the Group’s
income (including trading portfolio) for the half-year ended 31 December 2024 – BHP 13.3% and
Commonwealth Bank 10.2% (2023 : 2 – BHP 13.0% and Commonwealth Bank 11.0%).
20

3. Income from operating activities
Half-year

2024

$'000

Half-year

2023

$'000
Income from operating activities is comprised of the following:

Dividends & distributions

 securities held in investment portfolio
166,298

162,596

 securities held in trading portfolio
-

77

166,298

162,673

Interest income

deposits and income from bank bills
4,126

3,263

4,126 3,263
Net gains/(losses) and write downs


net gains from trading portfolio sales
1,004

2,039


unrealised gains/(losses) in trading portfolio 888

(707)

1,892

1,332



Administration fees received from other Listed Investment
Companies
3,017

2,458

Expenses recovered from other Listed Investment
Companies
85

4

Other expenses recovered 6

27

Sundry income 5 2


175,429 169,759



4. Trading 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 $95.6 million (30 June 2024: $34.5
million).








21

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 $1,712.9 million (30 June 2024 : $1,603.7 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
01/07/2024 Opening Balance

1,251,570 3,204,950
30/08/2024 Dividend Reinvestment Plan
i
5,461
7.26
39,650

30/08/2024 Dividend Substitution Share Plan
ii
920
7.26
n/a

Various On-market buybacks iii (4,831) (36,156)

Various Other Share Capital adjustments - (154)

31/12/2024 Balance
1,253,120
3,208,290

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 & Cboe 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. During the year, 4,831,108 shares were bought back at an average price of
$7.48.

7. Dividends
Half-year

2024

$’000
Half-year

2023

$’000




Dividends (fully franked) paid during the period 174,798

167,176

(excluding DSSP shares) (14.5 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 12.0 cents per share, fully franked. The
aggregate amount of the proposed interim dividend expected to
be paid on 25 February 2025, but not recognised as a liability at
the end of the half-year is 150,374


22

8. Earnings per Share
Half-year

2024


Half-year

2023


Number

Number

Weighted average number of ordinary shares used as the
denominator
1,254,483,603

1,244,426,335


$’000 $’000
Profit after tax for the half-year attributable to members of the
Company 154,162

149,997





Cents

Cents
Basic earnings per share 12.29

12.05



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 2024 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.
23

DIRECTORS' DECLARATION

In the Directors’ opinion:

(a) the financial statements and notes set out on pages 14 to 23 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 2024
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.



C.M. Drummond
Chairman

Melbourne
22 January 2025
24

25

26