BKI Investment (BKI), a listed investment company (LIC) associated with the Brickworks-Washington H South Pattinson group of companies dominated by the Millner family, has joined the list of LICs reporting solid results for the year to June 30.
The four Melbourne LICs – AMCIL, Mirrabooka, Australian Foundation and Djerriwarrh Investments – have all revealed small improvements in earnings for 2013-14 in the past week or so.
BKI’s figures, released yesterday, are little different except there’s a small lift in the final and annual dividends.
BKI said net operating pesult before special dividend income increased 20% to $35.9 million, while basic earnings per share before special dividend income increased 5% to 7.15c per share (cps).
Special dividend income for the year totalled $1.5 million, taking the basic eps tp 7.45cps.
As a result of the improved headline numbers, the BKI Board was in a position to lift the Final Ordinary Dividend from 3.40cps to 3.50cps.
That took full year ordinary dividends to 6.95cps, up from 6.65cps in 2012-13.
BKI 2Y – BKI lifts dividend after higher dividend inflow
BKI CEO Mr Tom Millner said in a statement issued with the results yesterday, “We’ve been able to deliver to shareholders another solid result including a further lift in dividend distributions.
"We are conscious that many of our shareholders live on dividends that we provide and thus work extremely hard in trying to provide to them a growing income stream.
“We continue to be ruthless on costs, we don’t charge shareholders an external portfolio management or performance fee and we have kept BKI debt free. By doing this it lays a solid foundation for us to be able to manage the portfolio for the long term with a real focus on lifting dividend distributions to our shareholders.”
BKI said the improved result was driven by higher dividend distributions from Woodside Petroleum, Suncorp Group, BHP Billiton, TPG Telecom, ANZ Banking Group, National Australia Bank, Westpac Bank and Commonwealth Bank.
Lower dividend contributions were received from UGL Limited, GWA International and ALS.
BKI also received special dividend income from Westpac Bank, New Hope Corporation, Milton Corporation, Coca-Cola Amatil and Suncorp Group.
These special dividends helped lift the net profit attributable to shareholders by 11% to $37.4 million.
BKI’s investment portfolio was valued at $804 million, up from $634 million at the end of 2012-13, thanks to the rise in the market and around $140 million invested during the year.
A placement during the financial year raised around $59 million for BKI, while a further $48 million came from an issue to existing shareholders.
"The capital raising was a great opportunity to increase BKI’s exposure to the market and take advantage of dividend income and franking credits on offer by many stocks within the local market.
"BKI deployed funds of approximately $140m into the market over FY2014; whilst sales totalled approximately $25m," the company said yesterday.
Major investments during the year included ANZ, Westpac, Primary Health Care, APA Group, Telstra, Insurance Australia Group and Transurban Group. New positions in Duet Group, Toll Holdings, IOOF Holdings, Maxitrans Industries and Equity Trustees were established.
Disposals included Metcash Limited, Gazal Corporation, Tabcorp Holdings, Fleetwood Corporation, Recall Holdings and the balance of the QBE Insurance Group position.
Unlike AMCIL, Mirrabooka, Australian Foundation and Djerriwarrh Investments, BKI’s dividend reinvestment program is not being offered at a discount.
But like Australian Foundation, BKI is now offering a share purchase plan for shareholders of up to $15,000 worth of shares.
BKI shares closed up half a per cent at $1.70 yesterday.
