How AFIC Invests

We invest in Australian companies that have unique high-quality assets, brands and/or business footprints that can withstand economic cycles. When selecting investments for our portfolio, we look for management and board strength, and sound financial metrics covering returns on investment, profit margins, cash flow and gearing.

We believe that these businesses generate superior returns over the long term.

If you’re an AFIC shareholder, it’s optional to participate in the DRP. You can choose whether to reinvest all or part of your dividends in the plan. Participants enjoy the benefits of compound returns over time with no brokerage costs when acquiring additional shares. It’s entirely flexible, allowing you to join or withdraw at any time.

For more information on the DRP, please read the DRP Rules.

When Australian resident taxpayers receive DSSP shares, no income tax is payable until the shares are sold.

The DSSP may be suitable for Australian taxpaying shareholders who:

• Want to defer tax-payable until selling their AFIC shares
• Are on a high marginal income tax rate
• Shareholders that pay tax at a lower rate (e.g. SMSF) may prefer the DRP.

Australian resident participants in the DSSP do not receive a dividend but in lieu of that, are issued shares. As they do not receive a dividend, they will not get franking credits or LIC capital gains tax deductions and will usually not be subject to income tax. The receipt of the substitute shares will change the tax cost base of the AFIC shares that participate in the DSSP and may therefore increase any capital gains tax paid on any subsequent disposal. For more details read the attached explanation.

Shareholders should in all cases seek their own advice as to whether or not participation in the DSSP is suitable for them.

For more information on the DSSP, please read the DSSP Rules. We have also included a link to the Australian Tax Office Class Ruling regarding the AFIC DSSP (refereed to in the document as a bonus share plan).

The Company has received advice that confirms that shares issued under the DSSP are treated as dividend distributions under New Zealand taxation law.

Consequently, participants should note that they continue to be able to claim New
Zealand imputation credits when completing a New Zealand tax return that includes
this distribution.

Shareholders should consult their own accountants and tax advisers as to the impact
that this may have on them, particularly with regard to their New Zealand tax returns.

Please note that the ASX announcements refers to the DSSP as a Bonus Security Plan (BSP).

Sign into Computershare – a secure shareholding administration platform – with your Shareholder Reference Number (SRN) or Holder Identification Number (HIN).

Alternatively, complete and return the forms below.

Key Dates

Final Financial Results and Final Dividend Payments 2020

* these dates may be subject to change

2020 Annual General Meeting

To give shareholders a reasonable opportunity to participate without being physically present in the same place, all shareholders and proxyholders will be able to participate in the AGM via the online platform or telephone:

Via the online platform https://web.lumiagm.com/ using code 360 460 979 or by using the Lumi AGM app, which is available by downloading the app from the Apple App Store or Google Play Store.

Using an online platform via a computer, mobile phone or iPad/tablet device with internet access you will be able to join and participate in the meeting.

Shareholders and proxyholders will have the ability to vote and ask questions in real time during the AGM and to hear all of the discussion via the online platform, subject to connectivity of your device. You will need to provide your shareholder details (including your SRN or HIN and postcode) to be verified as a shareholder.

Proxy holders will need to phone the Computershare call centre 1 hour before the meeting to obtain their login details.

Via telephone

To join via the teleconference, please use the details below:

Telephone: Conference ID: 8066738

1800 175 864 (free call within Australia)

1300 212 365 (mobile, free call within Australia)

+61 2 8373 3550 (outside Australia)

Shareholders and proxyholders will be able to listen into the presentation and discussion and ask questions via telephone. Participants cannot vote using the teleconference facility.

The Company encourages all shareholders to submit a proxy vote ahead of the meeting, this can be done using the paper form or online via investorvote.com.au. Questions may also be asked in advance of the meeting via email to [email protected]