The 12-month portfolio return, including franking, was 7.1%; the combined Small and Mid Cap 50 benchmark return over the corresponding period, including franking, was negative 1.9%. This outperformance is a very pleasing result, and has further reinforced our investment approach, over what has been a very challenging period.
Full Year Profit was $6.4 million compared with $8.9 million last year. The fall in profit was due primarily to a reduced contribution from investment income as companies reduced or suspended dividend payments. This fall was partially offset by an improved contribution from the Trading Portfolio.
The final dividend was maintained at 6.5 cents per share fully franked. Total fully franked ordinary dividends for the year are 10 cents per share. No special dividend has been paid or declared for this financial year.
Strong contributors to Mirrabooka’s outperformance included Macquarie Telecom, Objective Corporation, Fisher & Paykel Healthcare, Breville Group and NEXTDC.
The extreme volatility and deteriorating economic outlook over the financial year saw Mirrabooka further consolidate its investment portfolio from 63 to 52 holdings. Tough calls were required on exiting some interesting early stage companies, as funds were required to buy higher quality companies that were also sold off heavily during the year and are better placed for the deteriorating economic outlook.
Much of our buying through the recent market correction came through discounted rights issues and placements, in total $20 million was invested in 13 share issues. Our largest participation was in raisings by Auckland International Airport, Atlas Arteria, InvoCare, Reece, NEXTDC, Oil Search and Qube Holdings. Other purchases in recent share price weakness included Netwealth, Realestate.com, Xero, Infomedia, Cleanaway Waste Management and Breville Group, all of which are quality businesses which have strong positions in their respective industries.
– battening down the hatches
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