2026 AGM - Chairman's Address and Presentation

1 October 2026



The Manager
ASX Market Announcements
ASX Limited
Level 27,
39 Martin Place,
Sydney NSW 2000


Electronic Lodgement




Australian Foundation Investment Company Limited
2026 Annual General Meeting – Chairman’s Address and Presentation




Dear Sir / Madam


The following presentation will be delivered to shareholders at the Company’s Annual
General Meeting to be held today.



Yours faithfully,


Matthew Rowe
Company Secretary



ASX Release authorised by the Company Secretary, Matthew Rowe.

Chairman’s Address

Ladies and gentleman, the investment team will talk in detail about the portfolio
and performance shortly, but I wanted to acknowledge that performance of the
portfolio for the financial year was below expectations, particularly in the first
half of the year due to a lack of exposure to small and mid cap resources
companies, quality being out of favour and a number of individual stock
positions which the team will talk to in the presentation. Improvement of
performance is a key focus for the Board and we have taken steps to address
this.

There were a number of significant changes in the last 12 months, including
the appointment of Alison Gibson as CEO in July 2026 and Brett McNeill was
appointed as Portfolio Manager late last year.

Alison is well placed to lead the company given her investment expertise
combined with the knowledge and passion for the investment approach of
AFIC. Alison will talk about what she sees as the key areas of improvement
shortly, however she has already made strong progress enhancing the
processes that equip our investment team to deliver on AFIC’s investment
objectives.

One of the key objectives of AFIC is to provide shareholders with a stable to
growing stream of franked dividends. We are proud of the fact we have not cut
the dividend in times of stress such as Covid and the GFC and that
shareholders were able to rely on their AFIC dividend at these times. To meet
this objective the Board has made the following decisions:

1. Move to quarterly dividends with the first quarterly ordinary dividend of
6.75 cents per share and a special dividend of 2.5 cents per share being
determined this morning to be paid in November, with subsequent
equivalent dividends being paid in February, May and August subject to
no material unforeseen adverse market conditions and final Board
approval.

2. The Board intends to return surplus franking credits to shareholders in a
timely manner whilst maintaining an adequate level of franking reserves.
This is reflected in this morning’s announcement in which the Board
noted its intention to determine a special dividend of 10 cents per share
to be paid in equal quarterly instalments for the FY27 period.

The company currently intends to buy back shares in a meaningful way when
trading at a material discount as this is value accretive for shareholders. To
that end, $243 million of shares were bought back in FY26 reflecting the extent
of the value that the discount to net tangible assets offered

As announced in the Interim results in January 2026, the Board made the
decision not to proceed with the establishment of a separate international listed
investment company at this stage predominantly due to market conditions. On
the back of this decision, we have revised our investment approach by
increasing the concentration of the portfolio to increase the allocation to our
highest conviction positions.

We have retained the international exposure in the AFIC portfolio for three rea-
sons:
1) the portfolio provides diversification to companies and sectors that are
not available on the domestic market.
2) It provides options in the event that the ASX continues to reduce in size
and breadth.
3) The research provides valuable insights for companies in the domestic
portfolio.
The portfolio remains small in size at 1.5% of the AFIC portfolio at 30 June
2026. This will remain while the strategy proves itself to earn a greater alloca-
tion of capital.

The international investment team are here today and will be around after
the meeting if shareholders have any questions.

We thank shareholders for their continued support and are committed to
deliver improved outcomes. We continue to believe AFIC provides an
attractive investment option for all investors with access to a low cost, actively
managed portfolio with an investor friendly structure.

Annual General Meeting
October 2026

Annual General Meeting – October 2026
Board Members
Craig Drummond
Chairman and Independent
Non-Executive Director
Alison Gibson
Managing Director
Julie Fahey
Independent Non-Executive
Director
Katie Hudson
Independent Non-Executive
Director
Richard Murray
Independent Non-Executive
Director
David A Peever
Independent Non-Executive
Director
Rebecca Dee-Bradbury
Independent Non-Executive
Director
Graeme Liebelt
Independent Non-Executive
Director
2

Annual General Meeting – October 2026
Asking Questions Online
Asking questions
Only Shareholders and Proxyholders
are able to ask questions
Click on “Ask a Question”
Select “General Business”
or a specific resolution
Type in your question and
click “Submit”
Comments on resolutions can also be
submitted through “Ask a Question”
3

Annual General Meeting – October 2026
Voting Online
Click “Get a Voting Card”
(top and bottom of platform)
Enter your SRN/HIN or
Proxy Number and Postcode
Click “Submit Details and Vote”
Fill out your voting card
for each item of business
Click “Submit Vote”
Lodging your votes
4

Annual General Meeting
Presentation
October 2026

Annual General Meeting – October 2026
Australian Foundation Investment Company Limited and its subsidiary Australian Investment Company Services
Limited (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.
ABN: 56 004 147 120
Disclaimer
6

Annual General Meeting – October 2026
Agenda
7
CEO Address and Dividend Update Alison Gibson
Financial Results Andrew Porter
Portfolio Update Brett McNeill
Market Update & Outlook Brett McNeill and Winston Chong

Annual General Meeting – October 2026
CEO Address
8

Annual General Meeting – October 2026
Why did I rejoin AFIC?
PurposePeople
Strong
foundations
Ability to make a
difference
9

Annual General Meeting – October 2026
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Aug-2006Aug-2011Aug-2016Aug-2021Aug-2026
AFIC NTA Total Return, including frankingS&P/ASX 200 Accumulation Index, including franking
What am I looking to improve?
1) Investment Performance
AFIC 5 year Annualised Portfolio Returns
Assumes investors can take full advantage of franking credits. AFIC’s portfolio is calculated after expenses, income tax and tax on
realised capital gains. It should be noted that the market returns do not include expenses or tax.
10

Annual General Meeting – October 2026
What am I looking to improve?
2) Communicating our value more effectively
AFIC Share Price relative to Net Asset Backing
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
20012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023202420252026
11

Annual General Meeting – October 2026
Embracing the future
1928
Founded on trust and patient,
long-term investing
Today
Nearly 100 years on
2028
Our centenary
The next 100 years
Building for the
next generation
Actively managed
Low cost
Structure designed
for patient investing
12

Annual General Meeting – October 2026
Dividend Update
13

Annual General Meeting – October 2026
Stable to growing dividends with growing franking credit reserves
Franking credit
reserve now
~2 x ordinary
dividend
-
10
20
30
40
50
60
FY01FY02FY03FY04FY05FY06FY07FY08FY09FY10FY11FY12FY13FY14FY15FY16FY17FY18FY19FY20FY21FY22FY23FY24FY25FY26
Cents per share
Ordinary DividendsSpecial DividendsFully Franked Dividend Reserves per share
14

Annual General Meeting – October 2026
Dividend update announced this morning
Proposed FY27 Dividend*Moving to Quarterly Dividends
Total FY27 Dividend
37 cents per share, fully franked
Ordinary Dividend 27 cents per share, fully
franked
Special Dividend 10 cents per share, fully
franked
15
Proposed Dividend Schedule (cents per share)
Payment Date
Ordinary
Dividend
Special
Dividend
Total
Dividend
November 20266.752.509.25
February 20276.752.509.25
May 20276.752.509.25
August 20276.752.509.25
Total27.0010.0037.00
* Final determination of the dividends remains subject to no material unforeseen adverse market conditions and final Board approval.

Annual General Meeting – October 2026
4.9%
5.8%
7.9%
S&P/ASX 200 IndexAFIC Ordinary DividendAFIC Ordinary + Special
AFIC Dividend Yield, including franking
Represents attractive yield for shareholders
AFIC dividend yields are based on the dividends the Board has announced that it intends to determine for the FY27 period, fully franked, and the share price at 30
September 2026. S&P/ASX 200 Index yield is based on Consensus estimates for the next 12 months and the Market Value at 30 September 2026 assuming a franking
rate of 70%. Final determination of the dividends remains subject to no material unforeseen adverse market conditions and final Board approval.
16

Annual General Meeting – October 2026
Financial Results
17

Annual General Meeting – October 2026
Results Summary for Financial Year 2026
18

Annual General Meeting – October 2026
Portfolio Update
19

Annual General Meeting – October 2026
AFIC’s investment approach
Our key competitive
advantages
Our approach
Long term focus
Permanent capital
Investor friendly structure
Focus on quality companies
Benefit from compounding returns
over the long term
Build a well diversified portfolio
with the right mix of income and
growth
20

Annual General Meeting – October 2026
Recent Buying: Woolworths and Telstra
Dividend Per Share
Dividend Per Share
$0.92
$1.04
$1.44
$0.84
$0.97
$1.07
FY22FY23FY24FY25FY26FY27e
$0.17$0.17
$0.18
$0.19
$0.21
$0.22
FY22FY23FY24FY25FY26FY27e
Source: FactSet, Company Reports; FY27e Dividends are Consensus FY27 estimates.
21

Annual General Meeting – October 2026
Recent Buying: ProMedicus and TechnologyOne
$0.43
$0.58
$0.79
$1.10
$1.39
$1.82
FY22FY23FY24FY25FY26FY27e
$0.23
$0.27
$0.32
$0.36
$0.42
$0.50
FY21FY22FY23FY24FY25FY26e
Source: FactSet, Company Reports; FY26e and FY27e Earnings are Consensus estimates; TNE has a 30 September fiscal year-end with full year results reported in November.
Earnings Per Share
Earnings Per Share
22

Annual General Meeting – October 2026
Recent Buying: Newmont and Evolution Mining
$4.3
$3.2
$2.8
$6.4
$10.3
$13.2
FY21FY22FY23FY24FY25FY26e
$0.8
$0.7
$1.3
$2.0
$2.6
$2.7
FY22FY23FY24FY25FY26FY27e
Source: FactSet, Company Reports; FY26e and FY27e Operating Cash Flow are Consensus estimates.
Operating Cash Flow (USD$b)
Operating Cash Flow (AUD$b)
23

Annual General Meeting – October 2026
Recent Selling
Complete Disposals
Trimmed Holdings
24
Source: Major transactions for Calendar Year 2026 to date.

Annual General Meeting – October 2026
International Portfolio
25
Based on the Portfolio as at 31 August 2026. Excludes
Cash.
$157m
Total Portfolio Value
Stocks in the Portfolio
1.6%
Total % of AFIC Portfolio Value
International Portfolio Holdings
Key Portfolio Statistics
20

Annual General Meeting – October 2026
Market Update & Outlook
26

Annual General Meeting – October 2026
August Results Season: Key themes
Relief Rallies
Consumer
Softness
Good Dividend
Growth
Takeover
Activity
27

Annual General Meeting – October 2026
+50%
+33%
+16%
+11%
+8%
+6%
+4%
0%
-3%
-8%
BHPRIOWOWTLSWESTCLCBAGMGWDSCSL
Good dividend growth from our largest holdings
28
August Reporting Season – Dividend Growth from some of AFIC’s largest holdings
Source: Factset, Company Reports; Dividend growth measured as ordinary dividends declared for the six months to June 2026 versus the prior
corresponding period.

Annual General Meeting – October 2026
Portfolio Summary
Constructing a diversified portfolio of high-quality companies across different sectors andwith the appropriate balance
ofIncome and Growthis the keyforAFICto deliver on itsInvestment Objectivesin a variety of market conditions.
*Portfolio Value is based on the Investment Portfolio plus the
Trading portfolio, including Cash.
**As at 31 August 2026 – Australia and New Zealand Portfolio.
$9.9b
Total Portfolio Value*
$8.06
Net Tangible Asset (NTA) Backing Per Share
Stocks in the Portfolio**
59
Top 25 HoldingsKey Portfolio Statistics
29