WAM CAPITAL LIMITED — Net Asset Value 2016

Jun 13, 2016

Investment Update & Net Tangible Assets Report

AS AT 31 MAY 2016

Performance

Performance
								Since
Performance at 31 May2016	1 Mth	6 Mths	Fin YTD	1 Yr	3 Yrs %pa	5 Yrs %pa	10 Yrs %pa	Inception %pa (Aug-99)
WAM Investment Portfolio* S&P/ASX All Ordinaries Accumulation Index	5.1% 3.1%	6.6% 6.7%	20.7% 4.4%	18.8% -1.2%	18.0% 8.1%	15.5% 7.3%	13.3% 5.4%	18.0% 8.1%
Outperformance	2.0%	-0.1%	+16.3%	+20.0%	+9.9%	+8.2%	+7.9%	+9.9%

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

Net Tangible Assets (NTA) figures

Net Tangible Assets (NTA) figures
NTA before tax	191.65c*
NTA after tax and before tax on unrealised gains	192.34c**
NTA after tax	185.57c**

~~~~ *These figures are all after the payment of $2.6m (0.5 cents per share) in tax during the month. Includes 0.9 cents of tax assets resulting from the merger with Premium Investors.

Market overview

The S&P/ASX All Ordinaries Accumulation Index gained 3.1% for the month.

Global equity markets fell early in the month but rallied following commentary from the US Federal Reserve, which indicated a possible rate hike in June. The comments spurred the domestic market, which was also boosted by a rate cut and dovish inflation outlook from the Reserve Bank of Australia (RBA).

Australia’s major banks reported interim results or trading updates, which showed structural and cyclical headwinds still remain in the sector. The bank sector outperformed on the back of the rate cut, lifting the overall index during the month.

We remain cautious on the short-term performance of the Australian equity market. Our cash levels ensure we are well positioned to find opportunities in the market as they arise.

Zenith Investment Partners Product Assessment

Last week WAM Capital was rated by independent research house Zenith Investment Partners. You can read the full report on our website at www.wamfunds.com.au.

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WAM Capital Limited

WAM Capital Limited
ASX Code	WAM
Listed	Aug 1999
Gross assets	$931.9m
Market cap	$1,009.0m
Share price	$2.14
NTA before tax	$1.92
Shares on issue	471,514,559
Fully franked annualised interim dividend (FY2016) Dividendyield	14.5c 6.8%

Investment objectives

• Deliver investors a rising stream of fully franked dividends

• Provide capital growth

• Preserve capital

Company overview

WAM Capital Limited (ASX: WAM), one of Australia’s leading Listed Investment Companies, is managed by Wilson Asset Management. Listed in August 1999, WAM Capital provides investors with exposure to an actively managed diversified portfolio of undervalued growth companies, which are generally small-to-medium sized industrial companies listed on the Australian Securities Exchange. WAM Capital also provides exposure to relative value arbitrages and market mispricing opportunities.

Investment & Management Team Geoff Wilson Chairman/Portfolio Manager

Kate Thorley Chief Executive Officer/ Company Secretary

Chris Stott Chief Investment Officer/ Portfolio Manager

Matthew Haupt Portfolio Manager

Martin Hickson Senior Equity Analyst/Dealer

Tobias Yao Senior Equity Analyst

John Ayoub Senior Equity Analyst

Oscar Oberg Equity Analyst

James McNamara Head of Corporate Affairs

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Investment Update & Net Tangible Assets Report

AS AT 31 MAY 2016

Diversified portfolio

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||||||
|---|---|---|---|---|
|April 2016|May 2016|
|Investment Type|$m|%|$m|%|
|Listed Equities|572.0|63.8|676.5|70.8|
|Fixed Interest & Cash|358.5|36.2|279.2|29.2|
|Long Portfolio|930.5|100.0|955.7|100.0|
|Short Portfolio|(14.0)|(1.6)|(23.8)|(2.5)|
|Gross Assets|$916.5m|$931.9m|[*]|
|Total shares on issue|468,006,885|471,514,559|

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~~*~~ This figure is after the payment of $2.6m (0.5 cents per share) in tax during the month as well as the payment of the $26.5m (7.25 cents per share) fully franked interim dividend which traded ex dividend 27 April 2016 and was paid on 13 May 2016.

**During the month, 13.1m shares were issued under the Dividend Reinvestment Plan (DRP) shortfall placement for the final dividend.

Top holdings

Sector allocation

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|||||||
|---|---|---|---|---|---|
|Market|Market|
|Value|Value|
|Code|Company|
|$|as % Gross|
|Assets|
|29.2%|22.9%|
|PBG|Pacific Brands Limited|46,292,446|5.0%|
|HHV|Hunter Hall Global Value Limited|34,331,803|3.7%|
|ECX|Eclipx Group Limited|25,315,197|2.7%|
|SIQ|Smartgroup Corporation Limited|21,206,108|2.3%|
|-2.5%|
|APN|APN News & Media Limited|18,758,165|2.0%|
|1.0%|
|21.1%|
|CYA|Century Australia Investments Limited|17,594,523|1.9%|1.7%|
|NCK|Nick Scali Limited|15,592,644|1.7%|2.6%|
|MYX|Mayne Pharma Group Limited|15,523,612|1.7%|3.9%|12.5%|
|5.1%|
|SXL|Southern Cross Media Group Limited|15,124,438|1.6%|
|RWC Reliance Worldwide Corporation Limited|14,871,065|1.6%|
|MTS|Metcash Limited|14,797,833|1.6%|
|Financials 22.9%|
|AAD|Ardent Leisure Group|14,753,356|1.6%|
|Consumer Discretionary 21.1%|
|CCP|Credit Corp Group Limited|14,713,801|1.6%|
|Industrials 12.5%|
|MQA Macquarie Atlas Roads Group|14,604,828|1.6%|
|Health Care 5.1%|
|VOC|Vocus Communications Limited|14,468,101|1.6%|
|Information Technology 3.9%|
|SGF|SG Fleet Group Limited|14,057,101|1.5%|
|Consumer Staples 2.6%|
|MVP|Medical Developments International Limited|13,243,600|1.4%|Telecommunication Services 1.7%|
|RCG|RCG Corporation Limited|13,060,741|1.4%|Utilities 1.0%|
|CL1|Class Limited|12,911,710|1.4%|Short stock: -2.5%|
|VTG|Vita Group Limited|11,948,232|1.3%|Cash and Fixed Interest: 29.2%|

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Investment Update & Net Tangible Assets Report

AS AT 31 MAY 2016

Dividend growth

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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 usually paid on a six-monthly basis and the dividend reinvestment plan is available to shareholders for both the interim and final dividend.

WAM Capital dividends since inception

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Cents per share
18.0
16.0
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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*Annualised interim dividend

On 13 May 2016, the Company paid a fully franked interim dividend of 7.25 cents per share, an increase of 3.6% on the previous corresponding period.

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