Australian Foundation Investment Company (AFI) H2 2025 earnings summary

Executive summary

• Largest listed investment company on the ASX with 150,000 shareholders, focused on long-term, low-turnover investing in Australian, New Zealand, and select international equities, with a management expense ratio of 0.16%.

• Emphasis on stable to growing, fully franked dividends, with a history of sustaining payouts even during downturns, supported by strong franking reserves.

• Primary objectives are stable to growing dividends and attractive total returns over the medium to long term.

• $10k invested since 1995 grew to $178k, outperforming the ASX 200 Accumulation Index ($146k).

• Portfolio and share price returns are less volatile than the index.

Financial highlights

• Full-year profit of AUD 285 million, down from AUD 296.4 million last year.

• Operating EPS declined 22.7%, returning to 2019 levels.

• Portfolio return (including franking) was 10.7%, underperforming the ASX 200 Accumulation Index at 15.1%.

• Fully franked dividend per share: 31.5¢ (14.5¢ final, 5.0¢ special, 12¢ interim), up from 26¢ in FY24.

• NTA at 30 June 2025: $8.33; share price: $7.35.

Outlook and guidance

• Market remains fully priced and resilient despite tariff uncertainty, geopolitical tensions, and global uncertainties.

• Company earnings outlook is less certain, prompting a disciplined focus on costs.

• Market valuation is polarised between expensive growth stocks and cheap stocks lacking catalysts.

• Focus remains on identifying quality companies temporarily mispriced due to short-term negative news.

• Maintaining a balanced portfolio and focus on long-term value creation.