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Future Generation Australia's investment portfolio outperformance drives increased fully franked full year dividend
The Future Generation Australia investment portfolio outperformed both the S&P/ASX All Ordinaries Accumulation Index and the S&P/ASX Small Ordinaries Accumulation Index increasing 13.0%* in 2024, compared to 11.4% and 8.4% respectively.
This investment portfolio outperformance allowed the Board of Directors to increase the fully franked final dividend to 3.5 cents per share, bringing the fully franked full year dividend to 7.0 cents per share. This provides a dividend yield of 5.5%^ and a grossed-up dividend yield of 7.9%^^.
Total shareholder return (TSR) for the period was 20.6%, or 23.5% when including the value of franking credits. This was driven by the strong investment portfolio performance of 13.0%* and the narrowing of the share price discount to net tangible assets (NTA) over the year. During the financial year, the share price increased from $1.105 at 31 December 2023 to $1.26 at 31 December 2024, and the share price discount to NTA narrowed to 10.0% at 31 December 2024 from 17.1% at the start of the year.
The strong investment portfolio outperformance contributed to an operating profit before tax of $62.8 million and an operating profit after tax of $47.9 million.
Dr Philip Lowe, Chair of Future Generation Australia, said: “2024 marked my first year as Chair and I am proud of the performance we have achieved for shareholders. With a total shareholder return exceeding 20% and more than $5 million donated to our non-profit partners, Future Generation Australia is well positioned to deliver strong returns for shareholders while making a meaningful difference to children facing adversity.”
Caroline Gurney, CEO of Future Generation, said: "This year’s strong performance reflects the expertise of our leading fund managers. Their active management has been instrumental in Future Generation Australia's track record of investment portfolio outperformance since inception ten years ago. The Investment Committee remains confident that our portfolio of 17 boutique fund managers will continue to deliver superior returns with lower risk#.
“Over the past ten years, Future Generation Australia has paid an increasing stream of fully franked dividends to shareholders. With more than five years of coverage in our profits reserve, we are confident in the sustainability of future dividends. We aim to unlock further value for shareholders as the share price moves to NTA, or a premium, from its current discount.”
*Investment portfolio performance is before expenses, fees and taxes to compare to the relevant indexes which are also before expenses, fees and taxes.
^Based on the 27 February 2025 closing share price of $1.27 per share and the FY24 fully franked full year dividend of 7.0 cents per share.
^^Grossed-up dividend yield includes the value of franking credits and is based on a tax rate of 30.0%.
#Risk is measured by volatility. Volatility is a statistical measure of the dispersion of returns for a given security or market index. Volatility is measured by standard deviation, and can be thought of as an assessment of the risk in the investment portfolio. In most cases, the higher the volatility, the riskier the investment.
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The Future Generation Companies, Future Generation Australia (ASX: FGX) and Future Generation Global (ASX: FGG), are Australia’s first listed investment companies to provide investment and social returns.
Future Generation provides shareholders with exposure to leading Australian and global fund managers who deliver a stream of fully franked dividends and capital growth to investors. This group of leading fund managers manages $1.3 billion in assets on a pro-bono basis, waiving their performance and management fees. Their generosity allows the Future Generation companies to invest 1% of net tangible assets each year in not-for-profit organisations.
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Future Generation
The Future Generation Companies, Future Generation Australia (ASX: FGX) and Future Generation Global (ASX: FGG), are Australia’s first listed investment companies to provide investment and social returns. Future Generation provides shareholders...
Expertise
Future Generation
The Future Generation Companies, Future Generation Australia (ASX: FGX) and Future Generation Global (ASX: FGG), are Australia’s first listed investment companies to provide investment and social returns. Future Generation provides shareholders...
Expertise
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