Mirrabooka Investments (MIR) H2 2024 earnings summary

Executive summary

• Focus remains on investing in companies outside the top 50 in Australia and New Zealand, aiming for returns via fully franked dividends and capital growth.

• Achieved a profit of AUD 10.7 million for FY2023/24, down from AUD 11.3 million in the prior year.

• Total portfolio return of 17.4% (including franking), outperforming the 8.7% return of the combined S&P/ASX Small Ordinaries and Mid Cap 50 Accumulation Index.

• Marked 25 years of successful investing, with AUD 10,000 invested at inception growing to AUD 135,000 by April 2024.

• Portfolio activity included significant trimming of top holdings and redeployment into new opportunities, with 14 new stocks added and 5 exited, expanding holdings to 66.

Financial highlights

• Net profit for the year was AUD 10.7 million, down from AUD 11.3 million the previous year, mainly due to lower trading portfolio gains.

• Options trading contributed an unprecedented AUD 2.5 million to income.

• Realized capital gains after tax were AUD 30.8 million from AUD 124 million in portfolio sales, bolstering franking reserves.

• Total dividend for the year is AUD 0.13 per share, including a special dividend of AUD 0.025; fully franked dividend was 6.5 cents per share.

• Management expense ratio (MER) decreased to 0.56% from 0.59% due to portfolio growth.

Outlook and guidance

• Long-term earnings growth outlook for core holdings remains positive, with continued focus on rotating capital into better medium-term value opportunities.

• Macro risks such as inflation, interest rates, and global elections are acknowledged, but confidence remains in the resilience of core portfolio companies.

• Near-term earnings risk from a slowing economy persists, but moderating global inflation is positive.