WAM ACTIVE LIMITED — Net Asset Value 2014

Aug 12, 2014

AS AT 31 JULY 2014

Investment Update & Net Tangible Assets Report

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Performance

Performance
Performance at				3 Yrs	5 Yrs	Since Inception %pa
31 July 2014	1 Mth	6 Mths	1 Yr	%pa	%pa	(Jan-08)
WAA Investment Portfolio* S&P/ASX All Ordinaries Accumulation Index	2.2% 4.5%	8.1% 10.3%	18.9% 16.6%	14.1% 12.6%	13.1% 10.3%	13.3% 2.3%
Outperformance	-2.3%	-2.2%	+2.3%	+1.5%	+2.8%	+11.0%
UBS Bank Bill Index	0.2%	1.3%	2.7%	3.5%	3.9%	4.4%
Outperformance	+2.0%	+6.8%	+16.2%	+10.6%	+9.2%	+8.9%

• Investment performance and Index returns are before expenses, fees and taxes.

WAM Active Limited

WAM Active Limited
ASX Code	WAA
Listed	Jan 2008
Gross assets	$38.5m
Market cap	$44.6m
Share price	$1.30
NTA before tax	$1.08
Shares on issue	34,316,532
Fully franked dividend (FY2014)	9.6c
Dividend yield	7.4%

Net Tangible Assets (NTA) figures

Net Tangible Assets (NTA) figures
NTA before tax 107.67c
NTA after tax and before tax on unrealised gains 107.21c
NTA after tax 107.16c

Investment objectives

• Deliver a regular income stream via fully franked dividends

• Provide a positive return with low volatility, after fees, over most periods of time

• Preserve capital

Market overview

The new financial year got off to a strong start with the S&P/ASX All Ordinaries Accumulation Index (‘Index’) rising 4.5% in July. After hitting a six year high, the Index recorded its strongest monthly gain since July 2013. The market was driven higher primarily by the strong performance of local mining stocks. Investor confidence in the sector was bolstered following confirmation by Chinese authorities that the world’s second largest economy was on track to achieve growth of 7.5% and allaying concerns of a ‘hard landing’. The local Index has now risen 50% over the last 25 months since its low in June 2012.

Company overview

WAM Active Limited (ASX: WAA) is a Listed Investment Company managed by Wilson Asset Management Group. Listed in January 2008, WAA provides investors with exposure to an active trading style with the aim of achieving a sound return with a low correlation to traditional markets.

Investment & Management Team

The United States’ recovery continues to gather pace with figures out during the month showing their economy had expanded in the second quarter while unemployment had fallen to 6.1%, its lowest level since September 2008. The June US Federal Reserve Board minutes (out in July) revealed that the US Central Bank plans to stop its program of quantitative easing in October, reflecting improved economic conditions. US investors are now grappling with the growing expectation that interest rates will move higher in early 2015.

We continue to be cautious in our short term view of Australia’s equity market. Reporting season, which has commenced, will provide a good opportunity to discuss current conditions with corporates along with their outlook for the next 12 months. While the May Federal Budget dampened consumer confidence and stifled growth, we expect historically low interest rates to stimulate economic activity over the longer term.

Geoff Wilson Chairman/Portfolio Manager

Kate Thorley Chief Executive Officer/ Company Secretary

Chris Stott Chief Investment Officer/ Portfolio Manager

Martin Hickson Senior Equity Analyst/Dealer

Matthew Haupt Senior Equity Analyst

Tobias Yao Equity Analyst

Judith Buchan Head of Corporate Affairs

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AS AT 31 JULY 2014

Investment Update & Net Tangible Assets Report

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Diversified portfolio

Diversified portfolio
June 2014 Investment Type $m %	July 2014
	$m %
Listed Equities 20.8 53.5	28.8 74.7
Fixed Interest & Cash 18.1 46.5
	9.7 25.3
Long Portfolio 38.9 100.0%
	38.5 100.0%
Short Portfolio (1.1) (2.8)	(0.0) (0.0)
Gross Assets $37.8m
	$38.5m
Total shares on issue 34,316,532
	34,316,532

Top holdings

		Market Value as %
Code	Company	Gross Assets
MQA	Macquarie Atlas Roads Group	4.6%
CYA	CenturyAustralia Investments Limited	4.3%
CBAPA	CBA Perpetual Exc Resale Listed Sec - PERLS V	4.2%
CGF	Challenger Limited	3.3%
MYR	Myer Holdings Limited	3.1%
IPE	IPE Limited	3.0%
HIL	Hills Limited	2.9%
HHV	Hunter Hall Global Value Limited	2.7%
WIC	Westoz Investment CompanyLimited	2.6%
GMA	Genworth Mortgage Insurance Australia Limited	2.4%
CYG	CoventryGroupLimited	2.3%
CCP	Credit Corp Group Limited	2.2%
SVW	Seven GroupHoldings Limited	2.2%
IVC	Invocare Limited	2.1%
TLS	Telstra Corporation Limited	2.1%
RMD	Resmed Inc	2.0%
EGP	Echo Entertainment Group Limited	2.0%
SAI	SAI Global Limited	1.9%
IBC	Ironbark Capital Limited	1.8%
WBCPB	WBC Stapled Preferred Security II	1.7%

Sector allocation

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25.3%
32.4%
0.3%
0.9%
1.4%
1.6%
2.1%
3.8%
21.4%
10.8%
Financials 32.4%
Industrials 21.4%
Consumer Discretionary 10.8%
Telecommunication Services 3.8%
Health Care 2.1%
Information Technology 1.6%
Consumer Staples 1.4%
Materials 0.9%
Energy 0.3%
Cash and Fixed Interest 25.3%
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AS AT 31 JULY 2014

Investment Update & Net Tangible Assets Report

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Dividend growth

The Board is committed to paying an increasing stream of fully franked dividends to shareholders, provided the Company has sufficient profit reserves and franking credits, and it is within prudent business practices. The Company’s ability to generate franking credits is dependent upon the receipt of franked dividends from investments and the payment of tax. Dividends are paid on a six-monthly basis and the dividend reinvestment plan is available to shareholders for both the interim and final dividend.

WAM Active dividends since inception

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Cents per share
12.0
10.0
8.0
6.0
4.0
2.0
0.0
2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Fully franked dividends
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On 5 August 2014, the Company announced a fully franked final dividend of 4.8 cents per share. This brings the FY14 full year fully franked dividend to 9.6 cents per share.

The dividend reinvestment plan (DRP) will operate at a 5% discount for the final dividend. To participate in the DRP, shareholders should send their election to the Company’s share registrar (Boardroom) no later than 16 October 2014.

Key dividend dates

Ex date: 13 October 2014 Record date: 15 October 2014 Last election date for the DRP: 16 October 2014 Payment date: 24 October 2014

Priority offer to WAM Active shareholders in Future Generation Investment Fund Limited

WAM Active shareholders are entitled to a priority allocation to invest in the new Future Generation Investment Fund Limited. In a first for the Australian market, investors can now gain unprecedented access to Australia’s best fund managers for 0.0% performance fees and 0.0% management fees. As fund managers, and many service providers, will be providing their services on a pro bono basis, this will allow the company to donate 1.0% of assets each year to children’s charities to invest in Australia’s future generation. Where the balance of the forgone fees is greater than the amount paid to charities, the balance will be for the benefit of shareholders.

The priority allocation closes on 28 August 2014.

For further information, including the prospectus and online application form, visit www.futuregeninvest.com.au. If you have any queries relating to the Offer, call (02) 9247 6755 or email info@wamfunds.com.au.

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