AGM recap: FY27 dividend guidance, CEO observations and portfolio update
Quick Read:
- The Board announced its intention to determine total FY27 dividends of 37 cents per share, fully franked, comprising an ordinary dividend of 27 cents per share and a special dividend of 10 cents per share, subject to no material unforeseen adverse market conditions and final Board approval.
- The Board also announced the Company is moving to quarterly dividend payments effective immediately, with the first payment of 9.25 cents per share, fully franked, scheduled for November 2026.
- Alison Gibson, CEO and Managing Director of AFIC, outlined why she rejoined the business and the areas identified for improvement.
- Key portfolio changes included increased exposure to consumer staples and telecommunications, new investments in technology and gold, and selective reductions and exits based on valuation and quality considerations.
At our 2026 Annual General Meeting (AGM) held on 1 October, CEO and Managing Director of AFIC, Alison Gibson, outlined her observations since starting in July and areas of focus that have been identified. The Board and investment team also provided an update on FY27 dividend guidance, FY26 performance and recent portfolio activity. In this article, we recap the key discussion points.
FY27 dividend guidance and move to quarterly dividends
At the AGM, the Board announced its intention to determine a total dividend of 37 cents per share, fully franked, for FY27. The dividend will comprise an ordinary dividend of 27 cents per share and a special dividend of 10 cents per share. Final determination of the dividends remains subject to no material unforeseen adverse market conditions and final Board approval.
The approach reflects AFIC’s objective of providing shareholders with a stable to growing stream of ordinary franked dividends, while returning surplus franking credits and maintaining adequate reserves.
*Final determination of the dividends remains subject to no material unforeseen adverse market conditions and final Board approval.
The Board also announced that the Company will be moving to quarterly dividends, effective immediately, following shareholder feedback for more frequent payments. The first payment of 9.25 cents per share will be paid in November, followed by payments in February, May and August 2027.
Further details on the FY27 dividend guidance and quarterly payment schedule are available here.
CEO Address
A central theme of this year’s AGM was Alison Gibson’s vision of building on the Company’s strong foundations to deliver improved outcomes for shareholders.
AFIC continues to be guided by its purpose: to work solely for shareholders and to provide them with an actively managed portfolio at a low cost. For Alison, that purpose, AFIC’s people and its nearly 100-year history were important reasons for returning to the Company.
While acknowledging recent returns have been below expectations, Alison reinforced that AFIC’s investment philosophy remains focused on quality companies with strong management, sound balance sheets, and attractive returns on capital in the medium to long term.
Another area of focus is communicating AFIC’s value more effectively to the market. AFIC’s experience through market cycles, low-cost active management and ability to take a genuinely long-term view remain important strengths and differentiators. With AFIC trading at a discount to net asset backing, investors currently have the opportunity to buy a portfolio of quality companies at 85 cents in the dollar (as at 1 October).
For Alison, AFIC’s structure provides an opportunity to help shareholders build prosperity at every stage of life through ownership of quality businesses and the power of compounding.
“My focus now is to set the business up for the next 100 years and for the next generation of Australian shareholders”, Alison concluded.
Portfolio update
Portfolio Manager, Brett McNeill, outlined several recent changes to the portfolio, reflecting AFIC’s continued focus on quality, growth, income and valuation.
New positions included Pro Medicus and TechnologyOne, where market weakness provided an opportunity to invest in high-quality businesses at attractive valuations. Brett pointed to their strong management teams, balance sheets and long-term growth potential as key attributes. AFIC also introduced gold exposure through Newmont Corporation and Evolution Mining, two well-managed companies with strong balance sheets that add further diversification to the portfolio.
Positions in Woolworths and Telstra were increased, with Brett noting their importance to AFIC’s dividend income and the potential for dividend growth over time.
AFIC reduced positions in NAB, Westpac, BHP, Brambles, James Hardie and Ampol, largely reflecting valuation, position sizing and updated views on company prospects. The exits from Sonic Healthcare, Worley, PEXA and IDP Education reflected quality considerations, including cases where the original investment case had not played out.
Following the decision not to proceed with a separate international LIC, AFIC has retained a modest international allocation for diversification and exposure to companies and sectors not readily available in Australia. This includes exposure to the growth of AI through holdings such as Microsoft and Amazon, while maintaining AFIC’s focus on quality and valuation. As of 31 August 2026, the international portfolio represented 1.6% of AFIC’s total portfolio across 20 holdings.
Share buybacks also remain an important part of AFIC’s approach when shares trade at a material discount to net asset backing. During FY26, $243 million of shares were bought back, reflecting the value available at the prevailing discount.
Looking ahead
AFIC enters the new financial year with a clear focus on improving performance and investment outcomes while continuing the long-term, quality-focused approach that has served shareholders for almost a century. Its low-cost structure, active management, and focus on dividends remain central to delivering value for shareholders.
Shareholders can view the full AGM presentation for further information.