AUI - Australian United Investment Company

[System]

Australian United Investment Company Limited (AUI) is an investment company through portfolio management. AUI's funds are invested predominately in the shares of companies listed on the ASX.

http://www.aui.com.au

 

[piggybank]

 

[Beau]

View attachment 56112

Whats your blue line stand for on the chart?

Im in very early stages of reading these charts and yours keep showing up, so i would be good to know.

 

[piggybank]

Whats your blue line stand for on the chart?

Im in very early stages of reading these charts and yours keep showing up, so i would be good to know.

The blue lines on this chart is to show that resistance was encountered at that price.

 

[divs4ever]

HALF YEARLY REPORT TO SHAREHOLDERS
Dear Shareholder,
Dividend Payment
The 17.0 cent per share fully franked interim dividend has been paid today, by way of cheque,
notification of direct banking, or notification of allotment of shares under the Dividend Reinvestment
Plan, according to your instructions.
Net Asset Backing 28 February 2022: $10.02 per share
At 28 February 2022 the unaudited net tangible asset backing of the Company’s ordinary shares,
based on investments at market value, after tax on realised gains, before any future tax benefit of
realised losses, and before estimated tax on net unrealised gains and losses and after provision for
the interim dividend of 17.0 cents per share, was $10.02 per share, or $8.46 per share after
providing for estimated tax on unrealised portfolio gains.
Results for Half Year Ended 31 December 2021
On 18 February 2022, the Directors made the following report to the Australian Securities Exchange
concerning the Company’s performance and the interim dividend:
Financial Results and Dividend Announcement
for the Half Year Ended 31 December 2021
The Directors make the following report concerning the Company’s performance and interim
dividend.
Profit and Realised Capital Gains/Losses
Profit after income tax for the half year ended 31 December 2021 was $26,995,000 (previous
corresponding period: $14,113,000).
Profit after tax includes special dividends of $1,880,000 (previous corresponding period:
$249,000). Excluding these items profit after tax rose 81.2%1
.
1 Additional non-IFRS information.
Australian United Investment Company Limited
Half Yearly Report to Shareholders 2
Net profit has improved as a result of the broader recovery in dividend income seen throughout the
market and significant dividends received from BHP and Rio Tinto following strong commodity
prices.
Net realised gains on the investment portfolio after tax were $1,400,000 (previous corresponding
period: losses of $10,845,000), which under accounting standards are transferred directly to the
Realisation Reserve and are not included in Net Profit.
Earnings Per Share
Earnings per share based on the weighted average number of shares on issue for the half year
were 21.6 cents per share compared to 11.3 cents for the previous corresponding period.
Excluding special dividends, earnings per share rose 81.1% to 20.1 cents1
.
The weighted average number of ordinary shares for the half year rose 0.3% to 125,044,480 after
taking into account the shares issued in the dividend reinvestment plan.
Dividends
The Directors declare an interim dividend of 17.0 cents per share fully franked at 30% to
shareholders registered on 24 February 2022, to be paid on 18 March 2022. The comparable 2021
interim dividend was 17.0 cents per share fully franked at 30%.
LIC Capital Gains
The interim dividend will not include any Listed Investment Company capital gain dividend.
Dividend Reinvestment Plan
The Company operates a Dividend Reinvestment Plan (“DRP”) under which shareholders may
elect to have all or part of their dividend payment reinvested in new ordinary shares. Pricing of the
new DRP shares will be at the volume weighted average selling price of shares traded on the
Australian Securities Exchange in the five trading days beginning from the day the shares start
trading on an ex-dividend basis, without any discount. The last day for the receipt of an election
notice for participation in the plan is 25 February 2022.
Asset Backing
The net tangible asset backing per share based on the market valuation of investments was
$10.49 at 31 December 2021 and $9.94 at 31 January 2022. These calculations are after tax on
net realised gains, before any future tax benefit of net realised losses, before estimated tax on net
unrealised gains/losses, and before provision for the interim dividend.
The Company is a long-term investor and does not intend disposing of its total portfolio. If
estimated tax on unrealised portfolio gains were to be deducted, the above figures would be $8.81
at 31 December 2021 and $8.42 at 31 January 2022.
Australian United Investment Company Limited
Half Yearly Report to Shareholders 3
Performance
The Company’s net asset backing accumulation performance for the six months to 31 December
2021 (assuming all dividends were reinvested) was a rise of 2.1%, compared to the rise of 3.8% in
the S&P ASX 200 Accumulation index. The Company’s returns are after tax and expenses and the
impact of the Company’s gearing for which no allowance is made in the index.
Including the value of franking credits for shareholders who can fully utilise them, the Company’s
accumulation return for the half year to 31 December 2021 was an increase of 2.8% compared to
an increase of 4.6% in the S&P/ASX 200 Franking Credit Adjusted Total Return Index.
The Company’s relative performance for the half year was assisted by overweight allocations to
Sydney Airport, Carsales and Event Hospitality, and underweight allocation to the Information
Technology sector.
Relative performance was held back by overweight allocations to Rio Tinto, Washington Soul
Pattinson and Transurban, and underweight allocation to the Utilities and Real Estate sectors.
Management Expense Ratio
At 31 December 2021, annualised operating expenses (excluding finance costs) were 0.10% of the
average market value of the portfolio (previous corresponding period: 0.12%), reflecting the
increased value in the share portfolio.
Portfolio
The Company made net investments during the half year of around $40M financed by an increase
in borrowings of $30M and available cash of $10M.
Portfolio turnover for the half year to 31 December 2021 was 3.2%. The largest additions to and
sales from the portfolio for the half year were as follows:
Purchases
Northern Star (1) $12.1M
Worley (1) $10.7M
Aristocrat (1) $8.7M
BHP (1) $7.6M
Ramsay Healthcare (1) $7.0M

Sales
Aurizon (3) $15.7M
Invocare (3) $11.9M
Santos (3) $6.8M
Napier Ports (3) $6.0M
Washington Soul Pattinson (2) $5.4M


(1) Additions to existing positions.
(2) Partial disposal of holding.
(3) Fully disposed of holding.
At 31 December bank facilities were $170M drawn to $165M and cash and short term receivables
were $5.9M.
Australian United Investment Company Limited
Half Yearly Report to Shareholders 4
Outlook
We are transitioning from an unreal environment of money creation, record low interest rates and
negative real interest rates, large government deficits and asset inflation to a more “normal world”
of 2% - 3% inflation, 2% - 3% interest rates and lower government deficits.
The transition to “normal conditions” can be uncomfortable and it also contains the risks of higher
inflation and stagnation.
We are cautious on the outlook for the Australian share market this financial year as it is at
historically high levels in an environment of broad economic growth but with worries in respect to
inflation, interest rates, government deficits, COVID and geopolitical tensions.
We believe the AUI portfolio is well positioned for the environment described. The portfolio is
conservatively positioned and has significant holdings in Resources and Banks which typically
benefit from rising rates and inflation and is underweight high priced technology stocks.

DYOR

i do not hold AUI ( but MIGHT buy into them sometime in the future )

of the shares mentioned

i hold NST ( added to in the last 6 months )

i hold WOR ( bought into during the last 6 months )

i hold BHP ( no recent moves )

i hold SOL ( no recent moves )

 

[Dona Ferentes]

in the lst 6 months, Argo Investments (ARG) reduced its holding through steady selling of AUI Fully paid ordinary shares
from 13,264,840 or 10.62%
.... to 12,040,025 or 9.62%

 

[divs4ever]

am not that excited with the AUI ( and DUI ) practice of using a drawing facility to purchase shares , but that is the shareholders business

but look at these reports ( AUI and DUI ) and consider if the strategy has any useful hints for me , i notice the BHP buying ( in both LICs ) for example , so far i have resisted adding ( or reducing ) but will revisit that decision over the weekend ( i , SO FAR , would be rather adding carefully NST )

 

[Dona Ferentes]

 

[Belli]

Against its stable-mate.

I've no idea what the Total Return would be if dividends were thrown into the mix.

 

[monkton]

View attachment 144401

Macquarie not in this list, surprise for me at least.

 

[Belli]

While I don't hold the reporting season for LICs is interesting as each does not exactly do the same thing.

AUI has increased its dividend to 20c ff. No LIC Capital Gain is included. What is interesting is it also announced an SPP and it brought forward the payment date to coincide with the opening of the SPP. Its stable mate, DUI, reports tomorrow and it also announced it has brought forward its payment date to 9 September. What are the chances DUI will also announce an SPP?

Major transactions

 

[monkton]

While I don't hold the reporting season for LICs is interesting as each does not exactly do the same thing.

AUI has increased its dividend to 20c ff. No LIC Capital Gain is included. What is interesting is it also announced an SPP and it brought forward the payment date to coincide with the opening of the SPP. Its stable mate, DUI, reports tomorrow and it also announced it has brought forward its payment date to 9 September. What are the chances DUI will also announce an SPP?

View attachment 145555

Major transactions

View attachment 145556

A pay rise, happy days

 

[Belli]

A pay rise, happy days

I assume you hold. A few years ago I looked at both AUI and DUI but decided against them. The decision wasn't because I thought these LICs were bad or anything but I didn't want to add more holdings to those I already have. Both seem to be consistent payers and conservative with nothing fancy about them but that generally applies to the older LICs anyway.

 

[So_Cynical]

From memory 1 or both these LICs have never reduced their dividend, always paid the same or higher but mostly higher.

 

[divs4ever]

but that generally applies to the older LICs anyway.

but if you have bought in years back ( or averaged down the share price average over the years ) surely there would be less incentive to grab quick capital gains ( without an additional compelling reason )

i know Geoff Wilson is a big fan of measuring LICs by NTA but several of his LICs have very high portfolio turnover , surely a conservative LIC would value a low entry price and solid returns more highly

older-style LICs have charms of their own ( i suspect many holders have stuck with them for a long time as well )

 

[Belli]

From memory 1 or both these LICs have never reduced their dividend, always paid the same or higher but mostly higher.

I didn't know that. Done well for their shareholders in that case.

As for the post preceding this one, the usual ramble of cobbled together random and momentary thoughts which completely miss the point.

 

[Dona Ferentes]

From memory 1 or both these LICs have never reduced their dividend, always paid the same or higher but mostly higher.

last 9 years, agrregate of Half andd Final dividends

Dividends ($)

0.29

0.32

0.33

0.34

0.34

0.35

0.36

0.36

0.36

 

[monkton]

I assume you hold. A few years ago I looked at both AUI and DUI but decided against them. The decision wasn't because I thought these LICs were bad or anything but I didn't want to add more holdings to those I already have. Both seem to be consistent payers and conservative with nothing fancy about them but that generally applies to the older LICs anyway.

Yes @Belli I do hold AUI ( one of my larger holdings) but not DUI & as others have now stated they have not reduced their dividend. Smaller than AFI & ARG & I think a slightly better performer than those 2 as well over the longer period. Nearly always trades below NTA & appears tightly held. Unfortunately it appears to have become a bit more popular lately .

 

[Belli]

Yes @Belli I do hold AUI ( one of my larger holdings) but not DUI & as others have now stated they have not reduced their dividend. Smaller than AFI & ARG & I think a slightly better performer than those 2 as well over the longer period. Nearly always trades below NTA & appears tightly held. Unfortunately it appears to have become a bit more popular lately .

The holding is doing the task you want it to do by the look of it and that is all that matters in my view.

I got curious and looked at the latest holdings for the older LICs. AUI has more CSL than AFI but DUI certainly beats the lot (ARG doesn't give the valuation just % of assets.)

 

[monkton]