WAM Strategic Value (WAR) H1 2025 earnings summary

Executive summary

• Interim dividend increased by 33.3% to 3.0 cents per share, fully franked, for FY2025.

• Operating profit after tax for the half year ended 31 December 2024 was $4.96 million, down from $6.40 million in the prior year period.

• Investment portfolio delivered a 16.9% return in the 12 months to 31 December 2024, with a 3.8% gain over the half year.

• Total shareholder return for the half year was 7.9%, including franking credits.

• Since inception in June 2021, 12.75 cps in fully franked dividends paid, 18.2 cps including franking credits.

Financial highlights

• Annualised fully franked interim dividend yield is 5.3%, grossed-up yield 7.6%.

• Revenue from operating activities was $11.59 million, up from $5.56 million in the prior year period.

• Profit after tax was $4.96 million (2023: $6.40 million); basic and diluted EPS were 2.75 cents.

• Net cash provided by operating activities was $24.5 million, with cash and cash equivalents at $35.2 million at period end.

• Profits reserve at 31 January 2025 was 17.1 cps, covering 2.9 years of dividends.

Outlook and guidance

• Board remains focused on narrowing the share price discount to NTA and returning to a premium.

• Commitment to paying a stream of fully franked dividends, subject to profits reserves and franking credits.

• Portfolio positioned to benefit from continued narrowing of discounts in global LICs and LITs.

• No change in principal investment activity is expected in the future.

• Expectation to continue gently increasing dividends, with a focus on capital growth.