WAM CAPITAL LIMITED — Capital/Financing Update 2012

Aug 15, 2012

WAM Capital Limited (WAM)

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Placement

• Placement to raise up to $25.9 million

• Issue price 161.59 cents - the pre-tax Net Tangible Asset (NTA) per share as at 31 July 2012

• Investors in the placement receive one share plus one listed option

• Investors are entitled to the fully franked final dividend of 5.5 cents which will be paid on 28 September 2012

• Funds raised via the Placement to be invested as p er investment p rocess:

• Market Driven

• Research Driven

• Board expects no impact on dividend policy

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Aims of placement

• A reduction in fixed administrative expenses as they are spread across a larger pool of assets

• An increase in the liquidity of the company’s shares

• An increase in the size of the company, making it more significant in the market and p otentiall y im p rovin g the covera g e b y research firms , dealer groups and financial advisers

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Placement - timetable

	Announce NTA per share as at 31 July 2012 2 August 2012 Lode Prospectus with ASIC 2 Auust 2012	Announce NTA per share as at 31 July 2012 2 August 2012 Lode Prospectus with ASIC 2 Auust 2012	Announce NTA per share as at 31 July 2012 2 August 2012 Lode Prospectus with ASIC 2 Auust 2012	Announce NTA per share as at 31 July 2012 2 August 2012 Lode Prospectus with ASIC 2 Auust 2012
	Announce NTA per share as at 31 July 2012		2 August 2012
	Lode Prospectus with ASIC		2 Auust 2012
	g		g
	Placement offer opens		10.00am 3 August 2012
	Placement offer closes		5.00pm 24 August 2012
	Date of allotment		31 August 2012
	Expected date of despatch of holdings		31 August 2012
	statements
	Date new shares and options commence trading on the ASX		4 September 2012

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WAM Capital: superior returns from growth companies

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WAM provides…

• Exposure to a diversified portfolio of growth companies, primarily small to me di i d t i l i li t d on th e ASX um cap n us r a compan es s e

• Exposure to market mispricings and relative value arbitrages

Delivers strong and consistent returns

• Average investment return of 17.5% p.a. since inception outperforming the 10.6%

• S&P/ASX All Ordinaries Accumulation Index by p.a.

Delivers consistent stream of fully franked dividends

• R ecen t 10% i ncrease n i th e FY2012 f u ll f k e d di v id en d o f 11 . 0 t y ran cen s per

• share

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Outperformance since inception

WAM Capital has outperformed the market by 10.6% p.a. over 13 years

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Index re-based
800
700
600
500
400
300
200
100
-
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WAM Capital Ltd - Investment Portfolio (before all expenses, fees, taxes and dividends) S&P/ASX All Ordinaries Accumulation Index

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Outperformance: fi i l nanc a year

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	Fiil Y	I Pfli	S&P/ASX All Od	Of
	nanca ear	nvestment ortoo	rs Accumulation Index	utperormance
	1999/2000	+33.3%	+11.3%	+22.0%
	2000/2001	+30.2%	+8.9%	+21.3%
	2001/2002	+32.7%	-4.5%	+37.2%
	2002/2003	+12 3% .	1 1% - .	13 4% + .
	2003/2004	+27.3%	+22.4%	+4.9%
	2004/2005	+13.9%	+24.8%	-10.9%
	2005/2006	+27.4%	+24.2%	+3.2%
	2006/2007	+44.1%	+30.3%	+13.8%
	2007/2008	230%	121%	10 9%
		- .	- .	- .
	2008/2009	-3.2%	-22.2%	+19.0%
	2009/2010	+29.8%	+13.8%	+16.0%
	2010/2011	+17.9%	+12.2%	+5.7%
	2011/2012	+4.2%	-7.0%	+11.2%

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Consistent outperformance

	Performance 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception	Performance 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception	Performance 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception	Performance 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception	Performance 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception	Performance 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception	Performance 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception
	Performance	1 Yr	3 Yrs	5 Yrs	10 Yrs	Since Inception
	as at 30 June 2012	%	%pa	%pa	%pa	%pa (Aug-99)
	WAM Investment
	Portfolio S&P/ASX All Ordinaries	+4 2% .	+16 8% .	+3 5% .	+13 5% .	+17 5% .
	Accumulation Index	% -7.0	% +5.9	% -4.1	% +7.1	% +6.9
	O f utper ormance	11 2% + .	10 9% + .	6% +7.	6 4% + .	10 6% + .

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Dividend growth

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Final fully franked dividend
Cents per share
5.5 cents per share
18.0 Ex date: 17 Sept 2012
Record date: 21 Sept 2012
16.0
Payment date 28 Sept 2012
14.0
12 . 0
10.0
8.0
6.0
4.0
2.0
0.0
Ordinary Fully Franked Dividend Special Fully Franked Dividend Equal Access Share Buy-Back
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Who is Wilson Asset Management?

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• Manager of three listed investment companies and one unlisted fund

• 3 Listed Funds:

• WAM Capital Ltd (ASX: WAM)

• WAM R esearc : h Ltd (ASX WAX)

• − WAM Active Ltd (ASX: WAA)

• Funds under management: approx $320 million

• Focuses on small to medium cap industrial growth companies

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Our funds

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Research Market
Driven Driven
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What distinguishes Wilson Asset Management

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• Over 50 years of experience in the Australian sharemarket with a high degree of street smarts

• A unique research rating process

• An intensive investee company visitation schedule (800+ meetings per year)

• A total focus on managing money

• A broad coverage of various industry sectors, especially at the small to medium end of the market

• Extensive network of contacts to provide ideas to the investment team

• Flexible investment mandate (ability to hold cash and short sell)

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Our Style

• Fundamental bottom up approach

• Absolute return focus, benchmark unaware

• Quick decision making resulting from a flat structure

• Increased flexibility due to the relatively small funds under management

• A focus on risk adjusted returns with above average cash positions

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Our business model

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Investment
process
LIC structure
benefits
Investment Superior
focus – long term
Flexible
growth performance
mandate
companies record
Experienced
team
Tight cost
control
+
+
+
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Research Driven rat ng processi

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Filtering

• On cashflow, return on equity, quality of business and management.

Rating Process

• Rate management

• Rate the industry/position

• • Forecast two year EPS growth

• • Valuation measure EPS/PE

Qualitative

Quantitative

Buy / Sell criteria

• Buy only when catalyst or event is identified

• Sell when valuation reached

Management meetings

• Meet with management of over 800 companies per year

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Market Driven investment process

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We scour the market for opportunities:

• Initial public offerings

• Capital raisings

• Block trades

• Oversold position

• Takeovers

• Listed Investment Companies (LIC) discount to net tangible assets (NTA)

• Stocks trading at a discount to their NTA

• Earnings momentum / surprise

• Short selling

• Market themes and trends

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LICs are superior investment vehicles

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Listed Investment Companies are very attractive investment vehicles

• LICs have outperformed the market[^]

• *^

• Studies show LICs outperform managed funds

• Closed end structure – no applications or redemptions

• The abilit to make lon er term investments y g

• Not beholden to short term performance: the Manager is focused on delivering long term sustainable performance

• Provide consistent flow of fully franked dividends

• Lower Management Expense Ratio (MER) compared to managed funds

• Provide opportunities – can trade at a premium/discount to assets

• Trades on the ASX which provides intra-day liquidity

• Public companies provide stringent corporate governance and accountability of Directors

^ Australian Study: Morgan Stanly Smith Barney and Bell Potter

• UK Study: Collins Stewart

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External research coverage

Research Houses covering listed investment companies & WAM Capital:

• Bell Potter Securities

• Morgan Stanley Smith Barney

• Zenith Partners

• Independent Investment Research

• APAM LIC Research

• Evans & Partners

• JBWere

• Morningstar

• E.L.&C. Baillieu

WAM Capital is on the approved product list of the Association of Independently Owned Financial Planners (AIOFP), and is listed on BT SuperWrap and BT Investment Wrap . platforms

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Investor communications

• Website – wamfunds.com.au

• Weekly emails – includes market update

• Monthly NTA and investment updates

• Half yearly shareholder briefings

• Half earl investor newsletters y y

• Half yearly results and media release

• Media – Sky Business, Switzer, CNBC, newspapers, industry magazines

• Attend and present at industry conferences – ASX, AIA, ASA

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Questions

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Disclaimer

This presentation has been prepared for use in conjunction with a verbal presentation and should be read in that context.

Information for the graphs, charts and quoted indices contained in this presentation has been sourced from IRESS Market Technology, WAM Capital Ltd, WAM Research Ltd and WAM Active Ltd unless otherwise stated.

The information in this presentation is only intended for Australian residents.

Th e purpose o f thi s presen a t ti on s o prov i t id e n orma i f ti on on y an l d th e con en s o t t f th e presen a t ti on oes no purpor d t t t o provide investment advice. We strongly suggest that investors consult a financial adviser prior to making any investment decision.

The presentation does not take into account the investment objectives, financial situation or particular needs of any person and should not be used as the basis for makin g investment , financial or other decisions. The information is selective and ma y not be complete or accurate for your particular purposes and should not be construed as a recommendation to invest in any particular investment or security, or Fund offered by Wilson Asset Management.

The information provided in the presentation is given in good faith and is believed to be accurate at the time of compilation. Neither Wilson Asset Management, WAM Capital Ltd, WAM Research Ltd and WAM Active Ltd nor its directors or employees make any representation or warranty as to the accuracy , reliability , timeliness or completeness of the information . To the extent permissible by law, Wilson Asset Management, WAM Capital Ltd, WAM Research Ltd and WAM Active Ltd and its director and employees disclaim all liability (whether arising in contract, tort, negligence or otherwise) for any error, omission, loss or damage (whether direct, indirect, consequential or otherwise).

Performance figures quoted in the report are past performance. Past performance is not an indicator of future performance. Neither Wilson Asset Management, WAM Capital Ltd, WAM Research Ltd and WAM Active Ltd nor its directors or employees guarantee or make any representation as to the performance of the Funds, the maintenance or repayment of capital, the price at which shares may trade or any particular rate of return.

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