WAM Capital (WAM) Status Update summary

Fund and Portfolio Performance

• Achieved 43.0% investment portfolio performance in the 12 months to 30 November 2024, outperforming the S&P/ASX All Ordinaries Accumulation Index by 19.5% and the S&P/ASX Small Ordinaries Accumulation Index by 23.1%.

• All four funds outperformed in the first five months to November, with WAM Capital and WAM Microcap up over 6%, and WAM Research and WAM Active up over 12%.

• Since inception in August 1999, delivered an annualized investment portfolio performance of 15.8% per annum before expenses, fees, and taxes.

• Despite strong performance, share prices have underperformed, with WAM Capital trading at a 7% discount to NTA, a level not seen in over a decade, and WAM Microcap and WAM Active at 2% and 9% discounts respectively.

• Pre-tax NTA per share stood at $1.62 as of 30 November 2024, with a closing share price of $1.525 on 16 December 2024.

Dividend, Profit Reserve, and Franking Credits

• WAM Capital's profit reserve stands at AUD 0.224 per share as of 30 November 2024, supporting a FY2024 full year dividend of 15.5 cents per share, 60% franked.

• The profit reserve is 20% higher than during previous premium trading periods, yet shares are at a discount.

• Total dividends paid since inception, including franking credits, reached 448.8 cents per share.

• Restoring fully franked dividends depends on continued strong performance and realizing gains to generate franking credits.

• The board cut franking to 60% to avoid a potential drop to zero, but a return to 100% is possible with further gains.

Investment Strategy and Market Positioning

• The team focuses on companies with strong balance sheets, low debt, and clear catalysts for earnings upgrades.

• High conviction picks include TPG Singapore, a2 Milk, G8 Education, and AMP, with detailed rationale for each.

• AI innovation is being leveraged by portfolio companies like Temple & Webster and AI-Media.

• The investment process includes rigorous target price modeling and catalyst identification.

• The investment team is well-positioned to capitalize on anticipated interest rate cuts and a strong IPO pipeline in 2025.