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WAM ACTIVE LIMITED — Net Asset Value 2012
Dec 10, 2012
66032_rns_2012-12-10_7d5eb28b-c599-44fd-beda-496c5783d8ce.pdf
Net Asset Value
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WAM ACTIVE LIMITED (WAA) ABN 49 126 420 719 INVESTMENT UPDATE & NET TANGIBLE ASSETS REPORT NOVEMBER 2012
Company overview
WAM Active Limited (WAA) is a listed investment company that provides investors exposure to an active trading style with the aim of achieving a sound return with a low correlation to traditional markets.
Investment objective
The investment objectives are to deliver investors a growing income stream in the form of fully franked dividends and to preserve capital.
Outperformance against sharemarket
Since inception, the WAA investment portfolio has outperformed the overall sharemarket – its performance against the S&P/ASX All Ordinaries Accumulation Index is set out in the table below. The investment performance is before expenses, fees and taxes.
| Performance as at 30 November 2012 |
1 Mth % |
6 Mths % |
Fin YTD % |
1 Year % |
2 Yrs %pa |
3 Yrs %pa |
Since Inception (Jan-08) %pa |
|---|---|---|---|---|---|---|---|
| WAA Investment Portfolio S&P/ASX All Ordinaries Accumulation Index Outperformance |
+0.7% +0.3% +0.4% |
+8.7% +12.0% -3.3% |
+7.5% +11.7% -4.2% |
+12.0% +13.1% -1.1% |
+8.1% +2.8% +5.3% |
+6.6% +2.9% +3.7% |
+11.9% -2.7% +14.6% |
Net Tangible Asset (NTA) figures
The following NTA figures are after the payment of a fully franked final dividend of 4.5 cents per share paid on the 19 October 2012. The figures below have not been adjusted for the 13,058,342 remaining options on issue with an exercise price of $1.08 per share.
per share. |
|
|---|---|
| NTA before tax | 107.04c |
| NTA after tax and before tax on unrealised gains | 108.27c* |
| NTA after tax | 106.21c** |
- Includes tax assets of 1.23 cents per share.
**Includes the net effect of 1.23 cents of tax assets and 2.06 cents of deferred tax liabilities.
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WAM Active Limited| ABN 49 126 420 719 Phone 02 9247 6755 | Fax 02 9247 6855 | [email protected] | www.wamfunds.com.au
Market outlook
November keeps positive momentum going - just!
The ASX S&P All Ordinaries Accumulation Index finished up 0.27% for November. The market rallied strongly in the second half of the month to recover its early losses and eke out a small gain. This continued its positive momentum in 2012. We have now registered 10 positive months in the last 11. There was also another 0.25% cash rate cut from the RBA just after the month’s end, returning the cash rate to the same level as during the GFC. These low interest rates should help stimulate merger and takeover activity as their cost of capital for funding corporate activity has now fallen significantly. At some point this low interest rate environment should also stimulate the broader economy.
AGM season reflections
The number and breadth of earnings downgrades announced during the AGM season in November was the most notable in memory. This suggests that, even after the recent interest rate cuts, there could be more reductions by the RBA in 2013. Company feedback suggests economic conditions remain tough.
Miners digging for savings
Rio Tinto announced a major cutback in their capital expenditure and exploration budget during the month. This follows similar moves by BHP Billiton and Fortescue Metal Group a few months ago. The brunt of these cuts will be felt by many mining services companies who work with the major miners. Although companies in the sector have experienced big declines in their share prices over the last 6 months, they may have further falls based on these cost reduction programs. As new contracts are negotiated and current contracts come up for renewal, profit margins may be squeezed and revenue could fall as less work is undertaken. As these mining services companies are smaller in size they may provide us with trading opportunities as this new phase of the resources story plays out.
Dividends – 4.5 cents per share fully franked final
On 19 October 2012, the Company paid a fully franked final dividend of 4.5 cents per share. This is a 12.5% increase on the previous year’s final dividend.
The Board is committed to paying an increasing stream of fully franked dividends to shareholders provided the Company has sufficient franking credits and it is within prudent business practices. It must also comply with Government legislation and the ATO’s interpretation of a company’s ability to pay franked dividends. Dividends are paid on a six-monthly basis. Dividend payments will also be made with consideration to cash flow and cash holdings.
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WAM Active Limited| ABN 49 126 420 719 Phone 02 9247 6755 | Fax 02 9247 6855 | [email protected] | www.wamfunds.com.au
Dividends (continued)
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Option issue – 1 for 1 bonus issue
On 4 May 2012, the Board announced a 1 for 1 bonus issue of options to acquire ordinary shares in the capital of the Company. The options were allotted to shareholders on 25 June 2012. The options have an exercise price of $1.08 per share and can be exercised at any time on or before 12 December 2013. The options are currently trading on the ASX under the code WAAO.
As at 30 November 2012, 3,251,603 options have been exercised for a total consideration of $3,511,731 with a remaining balance of outstanding options being 13,058,342.
Portfolio structure
| As at 31 Oct 2012 | As at 31 Oct 2012 | As at 30 Nov 2012 | As at 30 Nov 2012 | ||
|---|---|---|---|---|---|
| Investment Type | $m % |
$m % |
|||
| Australian Equities | 15.8 | 73.3% | 14.2 | 65.9% | |
| Fixed Interest and Cash | 5.8 | 26.7% | 7.3 | 34.1% | |
| Total Long Portfolio | 21.6 | 100.0% | 21.5 | 100.0% | |
| Total Short Portfolio | (0.2) | (1.0%) | (0.0) | (0.0%) | |
| Total Fund Size | $21.4m | $21.5m | |||
| No. | No. | ||||
| Total ordinary shares on issue | 19,737,085 | 19,737,085 | |||
| Total options on issue | 13,058,342 | 13,058,342 |
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WAM Active Limited| ABN 49 126 420 719 Phone 02 9247 6755 | Fax 02 9247 6855 | [email protected] | www.wamfunds.com.au
Portfolio structure (continued)
At 30 November 2012 the major securities held in the portfolio were as follows:
| Code | Company | Market Value $ |
Market Value as % Gross Assets |
|---|---|---|---|
| INA | Ingenia Communities Group | 746,161 | 3.5% |
| RHG | RHG Limited | 676,495 | 3.1% |
| CYG | CoventryGroupLimited | 636,120 | 3.0% |
| BKW | Brickworks Limited | 619,223 | 2.9% |
| CRZ | Carsales.Com Limited | 611,098 | 2.8% |
| CCQ | Contango Capital Partners Limited | 580,254 | 2.7% |
| ALS | Alesco Corporation Limited | 535,048 | 2.5% |
| FXJ | Fairfax Media Limited | 453,184 | 2.1% |
| CLO | Clough Limited | 435,614 | 2.0% |
| TLS | Telstra Corporation Limited | 429,823 | 2.0% |
| PRV | Premium Investors Limited | 421,224 | 2.0% |
| SDG | Sunland GroupLimited | 391,700 | 1.8% |
| AGF | AMP Capital China Growth Fund | 363,645 | 1.7% |
| RIC | RidleyCorporation Limited | 361,663 | 1.7% |
| CSR | CSR Limited | 360,651 | 1.7% |
| MYR | Myer Holdings Limited | 352,625 | 1.6% |
| QAN | Qantas Airways Limited | 349,177 | 1.6% |
| IVA | Ivanhoe Australia Limited | 311,564 | 1.4% |
| SHV | Select Harvests Limited | 308,411 | 1.4% |
| CTN | Contango Microcap Limited | 294,986 | 1.4% |
Portfolio structure – sector allocation
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WAM Active Limited| ABN 49 126 420 719 Phone 02 9247 6755 | Fax 02 9247 6855 | [email protected] | www.wamfunds.com.au
Positive performance – yearly comparison to S&P/ASX All Ordinaries Accumulation Index
Set out below is the performance of WAA’s investment portfolio since listing to 30 November 2012 on a financial year basis. The performance data is before all expenses, fees and taxes and is used as a guide to how the Company’s investment portfolio has performed against the S&P/ASX All Ordinaries Accumulation Index which is also a before tax and expenses measure.
WAA Investment Portfolio |
S&P/ASX All Ordinaries Accumulation Index |
Outperformance |
|---|---|---|
| +2.2% +9.6% +22.7% +11.5% +5.5% +7.5% |
-15.2% -22.2% +13.8% +12.2% -7.0% +11.7% |
+17.4% +31.8% +8.9% -0.7% +12.5% -4.2% |
Performance - monthly comparison
The table below shows the month by month investment performance of WAA against the S&P/ASX All Ordinaries Accumulation Index.
| Jan 08 | Feb 08 | Mar 08 | Apr 08 | May 08 | Jun 08 | Jul 08 | |
|---|---|---|---|---|---|---|---|
| Investment Portfolio* | +0.3% | +1.2% | +0.5% | +1.6% | +2.4% | -3.7% | -1.1% |
| All Ords Accum. | -11.2% | +0.3% | -4.1% | +4.6% | +2.5% | -7.3% | -5.2% |
| Aug 08 | Sep 08 | Oct 08 | Nov 08 | Dec 08 | Jan 09 | Feb 09 | |
| Investment Portfolio* | +0.1% | -3.8% | -5.3% | -5.2% | +3.4% | -1.9% | +0.6% |
| All Ords Accum. | +4.0% | -10.6% | -13.9% | -7.2% | -0.1% | -4.9% | -4.3% |
| Mar 09 | Apr 09 | May 09 | Jun 09 | July 09 | Aug 09 | Sep 09 | |
| Investment Portfolio* | +4.5% | +7.6% | +5.0% | +6.2% | +9.6% | +7.5% | +6.2% |
| All Ords Accum. | +8.1% | +6.1% | +2.2% | +3.9% | +7.7% | +6.5% | +6.0% |
| Oct 09 | Nov 09 | Dec 09 | Jan 10 | Feb 10 | Mar 10 | Apr 10 | |
| Investment Portfolio* | +2.1% | +0.3% | +1.0% | -3.6% | +0.0% | +2.9% | +0.4% |
| All Ords Accum. | -1.9% | +1.9% | +3.7% | -5.8% | +1.8% | +5.8% | -1.2% |
| May 10 | Jun 10 | Jul 10 | Aug 10 | Sep 10 | Oct 10 | Nov 10 | |
| Investment Portfolio* | -4.0% | -0.9% | +1.6% | +0.1% | +2.7% | +1.3% | +2.3% |
| All Ords Accum. | -7.6% | -2.6% | +4.2% | -0.7% | +5.0% | +2.2% | -0.7% |
| Dec 10 | Jan 11 | Feb 11 | Mar 11 | Apr 11 | May 11 | Jun 11 | |
| Investment Portfolio* | +3.6% | +0.7% | -0.3% | +0.4% | +2.5% | -1.6% | -2.3% |
| All Ords Accum. | +3.8% | +0.1% | +2.2% | +0.6% | -0.6% | -1.9% | -2.4% |
| Jul 11 | Aug 11 | Sep 11 | Oct 11 | Nov 11 | Dec 11 | Jan 12 | |
| Investment Portfolio* | +0.0% | -1.2% | +0.7% | +2.1% | -0.4% | -1.0% | +1.0% |
| All Ords Accum. | -3.4% | -2.0% | -6.3% | +7.2% | -3.4% | -1.6% | +5.2% |
| Feb 12 | Mar 12 | Apr 12 | May 12 | Jun 12 | Jul 12 | Aug 12 | |
| Investment Portfolio* | +3.5% | +1.1% | +0.0% | -1.6% | +1.1% | +1.2% | +2.0% |
| All Ords Accum. | +2.4% | +1.2% | +1.1% | -6.9% | +0.3% | +3.7% | +2.1% |
| Sep 12 | Oct 12 | Nov 12 | Since Inception |
||||
| Investment Portfolio* | +1.4% | +1.9% | +0.7% | +73.8% | |||
| All Ords Accum. | +2.1% | +3.0% | +0.3% | -12.5% |
*The change in the portfolio before all expenses, fees and taxes.
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WAM Active Limited| ABN 49 126 420 719 Phone 02 9247 6755 | Fax 02 9247 6855 | [email protected] | www.wamfunds.com.au
For more information
Please contact Geoff Wilson, Chris Stott or Kate Thorley.
Wilson Asset Management Level 11, 139 Macquarie Street, Sydney NSW 2000 GPO Box 4658 Sydney NSW 2001
Phone 02 9247 6755 Fax 02 9247 6855 [email protected]
www.wamfunds.com.au
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WAM Active Limited| ABN 49 126 420 719 Phone 02 9247 6755 | Fax 02 9247 6855 | [email protected] | www.wamfunds.com.au