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WAM ACTIVE LIMITED — Net Asset Value 2012
Oct 9, 2012
66032_rns_2012-10-09_4f93a9a9-eba3-4c00-867c-f0835b1f0b1e.pdf
Net Asset Value
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WAM ACTIVE LIMITED (WAA) ABN 49 126 420 719 INVESTMENT UPDATE & NET TANGIBLE ASSETS REPORT SEPTEMBER 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 in both the short term and long term.
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.
| Since Inception (Jan-08) %pa |
|||||||
|---|---|---|---|---|---|---|---|
| Performance as at 30 September 2012 |
|||||||
| 1 Mth % |
6 Mths % |
Fin YTD % |
1 Year % |
2 Yrs %pa |
3 Yrs %pa |
||
| WAA Investment Portfolio S&P/ASX All Ordinaries Accumulation Index Outperformance |
+1.4% +2.1% -0.7% |
+4.2% +2.1% +2.1% |
+4.7% +8.2% -3.5% |
+11.0% +13.4% -2.4% |
+8.6% +1.9% +6.7% |
+6.5% +1.8% +4.7% |
+11.7% -3.4% +15.1% |
NTA figures
The following Net Tangible Asset (NTA) figures are before the payment of a fully franked final dividend of 4.5 cents per share payable on the 19 October 2012. The shares traded ex dividend on 8 October 2012. The figures below have not been adjusted for the 14,963,616 remaining options on issue with an exercise price of $1.08 per share.
| per share. | |
|---|---|
| NTA before tax | 109.73c |
| NTA after tax and before tax on unrealised gains | 111.42c* |
| NTA after tax | 109.37c** |
- Includes tax assets of 1.69 cents per share.
**Includes the net effect of 1.69 cents of tax assets and 2.05 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
Index up for the month
The ASX S&P All Ordinaries Accumulation Index finished the month up 2.1% and up 8.2% for the first quarter of the new financial year. The September quarter was the best for the Australian market in three years. The market was boosted by the US and European central banks announcing further monetary stimulus. Expectations of interest rate cuts domestically also improved market sentiment. A cut of 0.25% was delivered in early October with further rate cuts expected over the next 12 months.
Iron ore still rusting
While iron ore prices recovered somewhat during September there was no respite for companies in the mining services sector. Macmahon Holdings downgraded its FY13 profit forecast by 40% - 70%. This was one month after their full year result when a 20% rise in FY13 profits was forecast. Fortescue Metals Group cut staff numbers, announced asset sales, cut capital expenditure and refinanced debt to relieve pressure on its balance sheet. The reduction in capital expenditure by the major mining companies is slowly filtering through the mining services sector. We expect further downgrades in the coming months.
Waiting for guidance
We still believe analysts’ expectations for FY13 earnings are too high and that further earnings downgrades will be announced. Annual General Meeting (AGM) season is only a few weeks away and the profit guidance provided will be watched closely. Many companies provided little or no guidance with their results in August, where they would have normally done so. Thus there will be added emphasis on the updates provided at this year’s AGMs.
Dividends – 4.5 cents per share fully franked final
On 10 August 2012, the Board announced a fully franked FY2012 final dividend of 4.5 cents per share. This was a 12.5% increase on the previous year’s dividend.
| | Dividend ex date | 8 October 2012 |
|---|---|---|
| | Dividend record date | 12 October 2012 |
| | DRP election date | 12 October 2012 |
| | Dividend payment date | 19 October 2012 |
| | Last day for Option holders to exercise options in | |
| order to be eligible for the dividend | 5 October 2012 |
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, cash holdings and available franking credits.
The dividend re-investment plan will operate at a 2.5% discount to the weighted average market price of shares sold on the ASX on the books closing date (12 October 2012) and the three trading days preceding that date.
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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)
To participate in the dividend re-investment plan, please send your election form to our share registrar no later than 12 October 2012.
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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 September 2012, 1,346,329 options have been exercised for a total consideration of $1,454,035 with a remaining balance of outstanding options being 14,963,616.
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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
| As at 31 Aug 2012 | As at 31 Aug 2012 | As at 30 Sep 2012 | As at 30 Sep 2012 | ||
|---|---|---|---|---|---|
| Investment Type | $m % |
$m % |
|||
| Listed Equities | 9.7 | 52.1% | 11.6 | 57.3% | |
| Fixed Interest and Cash | 9.0 | 47.9% | 8.6 | 42.7% | |
| Total Long Portfolio | 18.7 | 100.0% | 20.2 | 100.0% | |
| Total Short Portfolio | (0.5) | (2.8%) | (0.3) | (1.7%) | |
| Total Fund Size | $18.2m | $19.9m | |||
| No. | No. | ||||
| Total ordinary shares on issue | 16,480,909 | 17,656,274 | |||
| Total options on issue | 16,138,981 | 14,963,616 |
At 30 September 2012 the major securities held in the portfolio were as follows:
| Market Value as % Gross Assets |
|||
| Market Value $ |
|||
| Code | Company | ||
| CBAPB | CBA Perpetual ExcResaleListed Sec- PERLSIV | 710,301 | 3.5% |
| ALS | Alesco Corporation Limited | 657,237 | 3.2% |
| INA | Ingenia Communities Group | 629,602 | 3.1% |
| CCQ | Contango Capital Partners Limited | 580,254 | 2.9% |
| RHG | RHG Limited | 553,341 | 2.7% |
| SDG | Sunland Group Limited | 540,060 | 2.7% |
| CYG | Coventry Group Limited | 529,533 | 2.6% |
| CIF | Challenger Infrastructure Fund | 427,639 | 2.1% |
| PRV | Premium Investors Limited | 410,950 | 2.0% |
| RIC | Ridley Corporation Limited | 402,857 | 2.0% |
| CRZ | Carsales.Com Limited | 401,450 | 2.0% |
| GLG | Gerard Lighting Group Limited | 383,097 | 1.9% |
| DJS | David Jones Limited | 367,213 | 1.8% |
| BOQ | Bank Of Queensland Limited | 332,686 | 1.6% |
| CLO | Clough Limited | 322,194 | 1.6% |
| AGF | AMP Capital China Growth Fund | 321,865 | 1.6% |
| FRI | Finbar Group Limited | 296,633 | 1.5% |
| SHV | Select Harvests Limited | 270,193 | 1.3% |
| CDA | Codan Limited | 237,253 | 1.2% |
| CND | Clarius Group Limited | 222,608 | 1.1% |
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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 – sector allocation
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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 September 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.
| S&P/ASX All Ordinaries Accumulation Index |
|||
WAA Investment Portfolio |
|||
| Financial Year | Outperformance | ||
| 2007/2008 2008/2009 2009/2010 2010/2011 2011/2012 2012/2013 YTD |
+2.2% +9.6% +22.7% +11.5% +5.5% +4.7% |
-15.2% -22.2% +13.8% +12.2% -7.0% +8.2% |
+17.4% +31.8% +8.9% -0.7% +12.5% -3.5% |
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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
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 | Since Inception |
||||||
| Investment Portfolio* | +1.4% | +69.3% | |||||
| All Ords Accum. | +2.1% | -15.3% |
*The change in the portfolio before all expenses, fees and taxes.
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