AFIC’s full-year net profit up 13.7pc to $279m
Australian Foundation Investment Company (AFIC) has posted a 13.7 per cent year-on-year growth in net profit to $279 million driven by a lift in dividends across its investments, particularly resource companies.
At the same time, revenues from operating activities stood at $308.5 million, which translated into an 11.1 per cent growth on to the prior year.
The board decided that the final dividend would be maintained at 14 cents a share fully franked, bringing total dividends for the year to 24 cents a share fully franked.
AFIC benefited from ongoing growth across global companies, particularly in the United States and China, which pushed up commodity prices and saw the Australian resources index up 41 per cent over the twelve-month period.
On top of that, there were increased flows of funds into the small and mid-cap section of the market as larger companies faced subdued growth.
Favourable market trends also saw AFIC’s portfolio grow 10.8 per cent for the twelve months to 30 June 2018, compared with the S&P/ASX 200 Accumulation Index’s growth of 13 per cent.
Apart from the large resource companies, the best performers in its portfolio were CSL, Wesfarmers, Macquarie Group, Oil Search and Woolworths.
However, AFIC warned many large Australian companies were currently facing a subdued growth outlook, which could be a key restraint on the market.
The firm said it would continue to adjust its portfolio, with major purchases including additions to holdings in Macquarie Group, CSL, Sonic Healthcare, James Hardie and Alumina, as well as Sydney Airport and Boral.
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