Listed investment company, AMCIL (AMH), has sold its holdings in some of the biggest companies on the ASX, such as the ANZ and Woodside to refocus its investment portfolio on small to medium stocks.
In its 2013-14 profit report, AMCIL (which was associated with the old JBWere broking house) revealed the rebalancing after a solid performance in the financial year.
As well as the ANZ Banking Group shares, other sales included, Rio Tinto, National Australia Bank, Amcor and Woodside Petroleum.
These holdings were sold, not because the company was worried about them, but because their share prices had risen to the point where the overall portfolio was overbalanced.
Directors explained in yesterday’s statement that "during the year the strong performance of some of the larger cap stocks in the portfolio meant the AMCIL portfolio had become more concentrated in these holdings."
"In general AMCIL seeks to have a portfolio where small companies by market size can have as significant an impact on portfolio returns as larger companies in the Australian market. To this end a number of adjustments were made," directors said.
Directors said that the company will continue looking to invest in smaller companies.
"AMCIL held a relatively high level of cash over the year reflecting our view it has been generally more challenging to find compelling value at these market levels."
AMCIL’s figures follows the annual result from the biggest of the quartet, Australian Foundation Investment Co on Monday and results last week from Djerriwarrh Investments and Mirrabooka.
AMCIL said net profit attributable to members was $6.3 million, down from last year’s result of $7.6 million.
But the 2012-13 was boosted by $1.1 million after tax from the takeover of Hastings Diversified Utilities Fund
The net operating result of $6.3 million (which covers the flow of income from the company’s investment portfolio) was down slightly from the, last year’s result of $6.5 millio
The total dividend 6.5 cents per share fully franked.This includes a final dividend of 2.5 cents per share fully franked plus a special dividend of 4 cents per share fully franked.
Directors said the special dividend was being paid from available franking credits each year.
"Accordingly, AMCIL will pay a final dividend of 2.5 cents per share fully franked from operating earnings and a special dividend of 4 cents per share fully franked sourced from after-tax realised gains of $11.4 million."
That’s lower than the 8 cents a share paid for 2012-13 with the final of 3 cents a share and the special payout of 5 cents a share.
That’s due to more franking credits being available in the 2012-13 financial year.
Amcil said that new companies added to AMCIL portfolio over year to June included Qube Holdings, Treasury Wine Estates, SAI Global, ResMed, TPG, Lifestyle Communities, Japara Healthcare and Transfield Services.
"Selective opportunities have been available in smaller companies, including some IPO’s such as Japara Healthcare and Beacon Lighting. We will continue to look at smaller companies where better value appears to be on offer," directors said.
AMCIL shares rose 2% yesterday to $1.02.
