Future Generation Australia (FGX) H2 2024 earnings summary

Executive summary

• Total shareholder return reached 23.5% including franking credits for 2024, with investment portfolio up 13.0%, consistently outperforming the ASX 200, All Ordinaries, and Small Ordinaries indices.

• Fully franked full year dividend of 7.0 cents per share paid, resulting in a grossed-up yield of 8.0% and 5.4 years of dividend coverage in profits reserve.

• Social investment totaled $5.4m in 2024, with over $43m donated since inception to nonprofits supporting vulnerable children.

• Appointment of the first Chief Investment Officer and transition of Chair to Dr Philip Lowe in March 2024.

• Significant cost savings from pro bono fund manager and service provider support, with $9.5m in 2024 and $152.1m since inception.

Financial highlights

• Investment portfolio performance grew by 13.0% in 2024, outpacing the S&P/ASX All Ordinaries by 1.6% and Small Ordinaries by 4.6%.

• Since inception, the portfolio has delivered 9.3% annualized growth, beating both major indices.

• Net Tangible Asset (NTA) growth was 11.8% for 2024; pre-tax NTA per share at $1.40 and post-tax NTA at $1.34.

• Share price discount to NTA narrowed from 17.1% to 8.63% (or 10.0%) over the year.

• Profits reserve at year-end was 37.9 cents per share, covering 5.4 years of dividends.

Outlook and guidance

• Commitment to further narrowing the share price discount to NTA and sustaining future dividends, supported by profits reserve and franking credits.

• Portfolio remains overweight in small, mid, and micro-cap companies, with optimism for further growth as these sectors recover.

• Expectation of further interest rate cuts in Australia, supporting consumer confidence and company earnings.

• New social impact partners to be announced in 2025 following a strategic review.