Melbourne-based listed investment company, Mirrabooka Investments yesterday reported a 37% lift in net profit to $10.4 million for the year to June 30.
Revenue from operating activities grew by 12% to $10.5 million in 2017-18, compared with the prior corresponding period.
The company will declare a final dividend of 6.5 cents fully franked, which is the same as last year, plus a 2 cent a a share special dividend. The interim dividend was an unchanged 3.5 cents a share.
Mirrabooka says the rise in full year profit is due to increased income from investments and a significantly higher contribution from the trading portfolio.
Mirrabooka shares ended down 1.4% at $2.75 as the wider market sold off on news of Donald trump’s latest trade war atrocity.
The company said its 12 month portfolio return was 14.7%; including franking it was 17.3%. That was less than the benchmark return of 20.4%, including franking.
"Mirrabooka has less exposure to speculative resource companies, which have been very strong this year,’ directors explained yesterday.
"Over the long term this has not hindered Mirrabooka’s performance with returns being consistently strong, whilst the small and mid cap resource indices have been volatile.
"Cash position is $28 million, 7% of the portfolio. We will be patient deploying this cash as valuations across most areas of the small and mid cap market remain very high.
"This cash gives Mirrabooka the capacity to add to selected holdings at lower prices should market volatility increase.,’ directors added.
"The most significant new additions to the portfolio were Boral, Webjet and Breville,’ directors said..
"More modest positions were also established in Reliance Worldwide, Dulux, Adelaide Brighton, Technology One and Corporate Travel.
"These are investments that we have the capacity to add to, particularly should prices fall with any increase in market volatility. In total, twenty new stocks were added to the Investment Portfolio over the year.
"Major sales included the complete disposal of Treasury Wine Estates, which had become very large in the portfolio and is now a top 50 company, Healthscope, Incitec Pivot and Japara Healthcare, as well as a reduction in the position of ALS.”