WAM Microcap (WMI) investor relations material

Executive summary

• Interim results for four managed funds were presented, highlighting WAM Capital, WAM Microcap, and WAM Research, with a focus on recent performance, market challenges, and a total shareholder return of 16.2% for the half-year including franking credits.

• Operating profit before tax for the half year ended 31 December 2025 was $43.2 million, down from $45.1 million in the prior year period, with after-tax profit at $31.0 million.

• Investment portfolio increased 11.4% over the six months, underperforming the S&P/ASX Small Ordinaries Accumulation Index, which rose 17.4%.

• An increased fully franked interim dividend of 5.35 cents per share was declared, with a final dividend of 5.3 cents per share paid during the period.

• The period since October has been described as the toughest in over a decade, with rapid market shifts, high inflation, and significant impacts from AI and geopolitical risks.

Financial highlights

• Net realised and unrealised gains on financial investments and foreign currency totaled $42.7 million (2024: $49.9 million).

• Cash and cash equivalents at period end were $34.2 million (June 2025: $33.9 million), with net assets increasing to $412.7 million (June 2025: $394.9 million).

• WAM Capital's share price premium to NTA reached 30% by February, despite a decline in net tangible assets.

• In 2022, the firm underperformed the market by 11%, but outperformed by 3%, 14%, and 9% in the subsequent three years.

• Paid 75.35 cps in dividends since inception, with 32.29 cps in franking credits.

Outlook and guidance

• The Board remains committed to paying a stream of fully franked dividends, subject to profits reserves and franking credits.

• Portfolio remains underweight in resources and financials, which drove recent index outperformance, but sees attractive opportunities in micro-cap industrials.

• Valuations are seen as depressed, presenting significant investment opportunities once market stability returns.

• Long-term investment process and focus on fundamentals are emphasized as key to navigating current volatility.

• No change in principal investment activity is expected in the future.