Bell Potter Dec 2015

10 February 2016

December Quarter 2015

LISTED INVESTMENT COMPANIES.

Nathan Umapathy [email protected]

Opinion Piece: Don’t forget about those options In recent times, we have seen the resurgence of the Listed Investment Companies (LICs) sector with a strong flow of new LICs listing on the ASX. In the last 2 years alone, $2.0bn has been raised in the LIC initial public offerings (IPO). Nearly all the LICs that are listed on the ASX, come with an attaching bonus option. These options tend to expire 18 to 24 months after issue. A large number of these bonus options are due to expire in 2016 and in this opinion piece, we discuss bonus options and what shareholders can do with these options.

Inside this edition


Opinion piece




Market update




(continued page 3).


Investment Highlights


Coverage of 42 securities New LICs - ALI, BTI, CBC, FGG & QVE New Hybrid - CTNG

As at the end of the Quarter, our key picks across pre-tax NTA and share price performance, distribution yield (based on the previous 12 months and including Special Dividends) and valuation were as follows. Please note that historical performance is no guarantee of future performance.

Index Table of Contents

2

Table 1: Quarter Highlights

Opinion Piece

3

Market Update

7

Pre-Tax NTA Perform ance (p.a.) Large 31-Dec-15

Summary

Lrg/Medium

Med/Sm all

Alternative

Intl

Universe Summary

10 11

(%) 5 years

AFI

AMH

CTN

FGX

MFF

Investment Performance

7.3

9.4

-1.1

n/a

24.5

Historical Gross Dividend Yield

12

7 years

10.4

13.1

7.7

n/a

18.2

Premium/Discount to NTA

13

10 years

6.5

8.0

4.9

n/a

n/a

Weekly Indicative NTA

18

Liquidity

21

Indirect Cost Ratio

22

Share Price Perform ance (p.a.) Large

Lrg/Medium

Med/Sm all

Alternative

Intl

AFI

AMH

CTN

WMK

MFF

5 years

8.2

12.3

2.1

n/a

25.8

7 years

10.6

14.5

13.4

n/a

21.2

10 years

7.6

10.5

6.8

n/a

n/a

31-Dec-15 (%)

Distribution 31-Dec-15 (%)

Large

Lrg/Medium

Med/Sm all

Alternative

Intl

AFI

AMH

CTN

ALF

HHV

Net Yield

3.9

4.5

8.1

7.2

10.2

Franking

100.0

100.0

50.0

100.0

6.0

5.5

6.4

9.8

10.2

10.4

Gross Yield Valuation 31-Dec-15 (%)

Large

Lrg/Medium

Med/Sm all

Alternative

Intl

AFI

AMH

CTN

FGX

GVF

Current Disc/Prem

5.7

-3.8

-16.5

-2.5

-11.2

3 year avg 5 year avg

3.8 0.7

-4.0 -9.7

-10.0 -15.0

n/a n/a

n/a n/a

10 year avg

1.3

-13.9

-20.7

n/a

n/a

LIC Profiles Domestic Equity Large Capitalisation

23

Large to Medium Capitalisation

28

Medium and Small Capitalisation

38

Small Capitalisation

43

Long/Short

46

Market Neutral

50

International Equity Global

51

Asia

58

Country

59

Specialist Investment

60

Hybrid

65

Appendix A: Glossary of terms Appendix B: Legend to Performance Measures Appendix C: Disclosures

68 70 72

SOURCE: COMPANY DATA, IRESS & BELL POTTER

It is important that clients are aware that the share price of a LIC is impacted by the oscillation of the discount or premium to NTA, which should be taken into consideration when investing in LICs. We therefore advise clients to view this report in conjunction with the Bell Potter Weekly Indicative NTA. For further information please speak to your Bell Potter Adviser.

Bell Potter Securities Limited

[email protected] www.bellpotter.com.au

ABN 25 006 390 772 AFSL no. 243480

LISTED INVESTMENT COMPANIES.

2

Table of Contents Opinion Piece

3

Market Update

7

Summary Universe Summary

10

Investment Performance

11

Historical Gross Dividend Yield

12

Premium/Discount to NTA

13

Weekly Indicative NTA

18

Liquidity

21

Indirect Cost Ratio

22

LIC Profiles Domestic Investment Focus Large Capitalisation (AFI, ARG, DJW, AUI, CYA)

23

Large to Medium Capitalisation (MLT, BKI, CIN, DUI, WHF, AMH, QVE, CAM, FSI, CBC)

28

Medium to Small Capitalisation (WAM, MIR, WIC, WAX, OZG)

38

Small Capitalisation (CTN, ACQ, BTI)

43

Long/Short (ALF, CDM, WAA, NCC)

46

Market Neutral (WMK)

50

International Investment Focus Global (MFF, PMC, TGG, HHV, PGF, GVF, ALI)

51

Asia (PAF)

58

Country (AGF (china))

59

Specialist Investment Focus Fixed Income (HHY (wind-up))

60

Income (ABW)

61

Fund of Funds (FGX, FGG)

62

Activist (SNC)

64

Hybrids Convertible Note (AFIG, CTNG)

65

Preference Share (WHFPB)

67

Appendix A: Glossary of terms

68

Appendix B: Legend to Performance Measures

70

Appendix C: Disclosures

72

LISTED INVESTMENT COMPANIES.

3

Opinion Piece: Don’t forget about those options In recent times, we have seen the resurgence of the Listed Investment Companies (LICs) sector with a strong flow of new LICs listing on the ASX. In the last 2 years alone, $2.0bn has been raised via LIC initial public offerings (IPO). We believe this growing demand stems from investors increasing interest in listed managed product. LICs are professional managed investment portfolios that offer immediate diversification and access to top quality fund managers, while also being transparent and liquid. At the same time, LICs are also strongly supported by brokers and increasingly used by financial planners post FoFA, as LICs offer varying exposures that compliment an existing portfolio of listed assets and can materially enhance risk adjusted outcomes for clients. Nearly all the LICs that are listed on the ASX, come with an attaching bonus option. These options tend to expire 18 to 24 months after issue. A large number of these bonus options are due to expire in 2016 and in this opinion piece, we discuss bonus options and what shareholders can do with these options. What is a LIC Bonus Option? A bonus option issued by a LIC is offered to security holders that participate in an IPO. The option holder is able to purchase additional shares of the underlying security at a fixed price (strike price) until a specified date (expiry date). The bonus option is usually listed and can be sold on the ASX. This allows the holder of the bonus option to monetise the option value by selling the option on market if they do no want to exercise the option (buy more of the security) themselves. Bonus Option compensate for Initial NTA reduction Similar to managed funds and all investment products there is a cost of participating in an investment in the form of a transaction fee. In a LIC this fee is embedded in the Net Tangible Asset (NTA). Generally this fee is 2-3% and covers all the transactional costs including the cost of advice, and for a $1.00 IPO this will see an opening NTA of $0.97-$0.98. Options were introduced to provide an incentive for investors to participate in the IPO and place them at a significant advantage to those who purchase these securities in the secondary market. These options are usually listed on the ASX and are priced in the market using a formula called Black-Scholes. However, they trade on market and are exposed to the vagaries of supply and demand which usually sees them trade between $0.04 to $0.05 on day 1. Table 2: LIC Initial Public Offering—2015 Name (ASX/Option Code) Wealth Defenders Equity (WDE/WDEO) Argo Global Listed Infrastructure (ALI/ALIO) Contango Incom e Generator (CIE/CIEO)

Listing Date

Issue Price

Initial NTA

Listing Price

Option Ratio Bonus

Exercise Price

Expiry

May-15 $

1.000

$

0.976

1 Option for 1 Share

$

0.010

$

1.000

Jul-15 $

2.000

$

1.965

1 Option for 1 Share

$

0.027

$

2.000

Nov-16 Mar-17

Aug-15 $

1.000

$

0.986

1 Option for 2 Shares

$

0.050

$

1.000

Mar-18

Glennon Sm all Com panies (GC1/GC1O)

Aug-15 $

1.000

$

0.971

1 Option for 1 Share

$

0.040

$

1.000

Aug-16

Future Gen Global Investm ent Com p (FGG/FGGO)

Sep-15 $

1.100

$

1.087

1 Option for 1 Share

$

0.050

$

1.100

Sep-17

Ellerston Asian Investm ents (EAI/EAIO) Platinum Asia Investm ents (PAI/ PAIO)

Sep-15 $

1.000

$

0.972

1 Option for 2 Shares

n/a*

$

1.000

Feb-19

Sep-15 $

1.000

$

0.985

1 Option for 1 Share

$

0.048

$

1.000

May-17

Absolute Equity Perform ance Fund (AEG/AEGO) 8Ip Em erging Com panies (8EC/8ECO)

Dec-15 $

1.100

$

1.075

1 Option for 1 Share

n/a*

$

1.100

Nov-17

Dec-15 $

1.000

$

0.979

1 Option for 2 Shares

$

0.040

$

1.000

Dec-16

*Options will be listed 6 months after shares quoted on ASX. SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

4

Opinion Piece (cont.) As an example, lets assume the options are priced at $0.04 and the NTA is $0.98 on day 1 of its listing. If the share price trades at the asset backing of $0.98 and the option trades at $0.04, the investors effective traded value is $1.02. This option will likely trade at a higher value if the share price increases, and those that own the options can potentially exercise that right and buy into the security at $1.00. However, those that participate in the secondary market will not pick up the option unless they buy it separately, and their returns may be impacted by the dilution associated with the options exercise. What to consider when you hold a LIC Bonus Option Investors holding options have 3 choices to consider: exercise the option, sell the option or do nothing. Table 3: What Investor can do with Options Exercise the option

Sell the option

Do nothing

• An option entitles the holder to one share in the underlying security at the exercise price.

• As most bonus options are listed on the ASX, they • Options holders that do not exercise their right to can be bought and sold on market. buy more shares or sell the option on market will expire on the expiry date. • Once exercised, the option will convert to fully paid • Options holders that are not interested in buying ordinary share and rank equally with existing share. more securities in the underlying security can sell • As the holder of an option, there is no obligation to their options on market to compensate them for the exercise or sell the option on market, however, the • Options should only be exercised when the share dilution associated with option holders that do option will expire worthless and the investors return price trades at a higher price than the exercise price, exercise their right. will not be compensated for the dilution associated otherwise it would be cheaper to purchase the share with any options that are exercised. on the ASX.

Don’t let options lapse Whether or not an option holder decides to exercise or sell an option, largely depends on the investors individual circumstances. However, an option holder should only exercise an option if it is ‘in the money’ i.e. the share price is higher than the exercise price. We would advise investors that have no intention of exercising to sell these options on market to unlock some value. Holders that ‘do nothing’ will not be compensated for any dilution that occurs as other investors exercise their options. The value of these options will vary depending on the underlying share price. However, it is worth noting that as the options reach expiry they generally tend to drop in value. The reasoning is that if they are ‘in the money’ some investors may be tempted to ‘sell the share’ and ‘buy the option’, if the option price plus the exercise price is lower than the current share price. This has a tendency to drive down the share price as the expiry date approaches, and this in-turn reduce the value of the option. On the positive side, it can also make for good buying if it does push an LIC into a deeper than ordinary discount.

LISTED INVESTMENT COMPANIES.

5

Opinion Piece (cont.) Bonus Options expiring in the next 6 months The table below lists LIC Options that will expire within the next 6 months. We have also calculated the current fully diluted discount, and the average fully diluted discount post listing. Table 4: Outstanding options expiring within the next 6 months ASX Code

Stock Price

Options Code

Exercise Price

Outstanding Options

Expiry

QV Equities

QVE

$1.01

QVEO

$1.00

165,804,081

15-Mar-16

Global Value Fund

GVF

$1.01

GVFO

$1.00

50,623,734

17-Mar-16

BTI

$0.96

BTIO

$1.00

58,336,509

31-Mar-16

PM Capital Asian Fund

PAF

$0.87

PAFO

$1.00

55,087,500

31-May-16

Perpetual Equity Investm ent Com p

PIC

$0.95

PICO

$1.00

249,712,777

10-Jun-16

Bailador Technology Investm ent

Data as at close of business 29 Jan 2016. SOURCE: COMPANY DATA, IRESS & BELL POTTER

Table 5: Effective impact to share price if premium or discount normalize

ASX Code

Stock Price

Fully Diluted Indicative Pre Tax NTA

Indicative Premium/ Discount

QV Equities

QVE

$1.01

$1.04

Global Value Fund

GVF

$1.01

$1.09

BTI

$0.96

PM Capital Asian Fund

PAF

Perpetual Equity Investm ent Comp

PIC

Bailador Technology Investm ent

Ave Premium/ Discount since Incept.

Investment return if Premium/Discount normalise

-2.88%

1.20%

4.08%

-7.80%

-2.44%

5.36%

$1.13

-15.04%

-18.90%

-3.86%

$0.87

$1.02

-15.20%

-10.40%

4.80%

$0.95

$1.01

-5.94%

-3.30%

2.64%

Data as at close of business 29 Jan 2016. SOURCE: COMPANY DATA, IRESS & BELL POTTER

QVE and GVF are both trading above the exercise price which suggests that there is value in the option. QVE has an average fully diluted premium to NTA of 1.20% compared to the 2.88% discount presently, suggesting reasonable value. This is replicated with GVF also indicating value with the current discount at 7.80% compared with the average discount at 2.44%. If the discount were to normalise this would suggest a 5.36% investment return alone. BTI, PAF and PIC share prices are all trading below their $1.00 exercise price suggesting that there is no value in exercising the option presently, and that you may be better off selling the option (admittedly at a limited value) and potentially buying on market. It is interesting to note that all 3 appear to offer value presently, suggesting good buying at these levels.

LISTED INVESTMENT COMPANIES.

6

Opinion Piece (cont.) Strong investment performance from GVF, BTI, PIC and QVE It is also worth considering the NTA investment performance of these LICs. Most notably GVF, BTI, PIC and QVE have delivered solid NTA growth (options dilution removed), outperforming their respective benchmarks 8.6%, 6.4%, 6.0% and 2.1% since inception. This strong investment performance should give these managers a competitive angle to market the LIC to investors. Further the absence of options is also likely to enhance each LICs trading in the secondary market given no upside dilution which does tend to weigh on the share price. In conjunction with a credible communications strategy we suspect this LICs may be able to generate more demand for the stock and arguably drive share price appreciation. Table 6: Pre-Tax NTA Performance ASX Listed Investment Companies

ASX Code

Investment Mandate

Pre-tax NTA Peformance (%) 3-mth 6-mth 1 Year Incept.

Benchmark

3-mth

Value Add + (%) 6-mth 1 Year

Incept.

Dom estic Equity

QVE

QV Equities

Large/Medium

PIC

Perpetual Equity Investment Comp

Large/Medium

BTI

Bailador Technology Investment

Unlisted Tech

6.3 6.4 14.6

3.9 6.7 15.5

9.0 8.8 14.4

9.4 8.8 14.4

S&P/ASX 300 Ex 20 Accum

-0.2 6.0

1.2 -2.6

12.2 2.8

15.0 6.9

BBSW 1 Year Rate + 4%

S&P/ASX 300 Accum 8.00% p.a

-1.4 -0.1 12.7

-0.9 7.1 11.6

-1.4 6.0 6.4

2.1 6.0 6.4

-1.7 6.1

-1.9 6.3

6.0 1.1

8.6 -3.4

International Equity

GVF

Global Value Fund

Global

PAF

PM Capital Asian Fund

Asia

MSCI Asia (Ex-Jpn) Accum

Data as at 31 Dec 2015. SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

7

Market Update Initial Public Offering After a stellar 2014, the LIC sector followed that up with another strong year in 2015 with 9 new LICs coming to market and raising over $1.4bn. The largest LIC to list in 2015 was Future Generation Global Investment Company (ASX: FGG), which secured $302.1m, followed by Platinum Asia Investments (ASX:PAI) and Argo Global Listed Infrastructure (ASX:ALI) both raising just under $300m. Once again International LICs drove the bulk of the money raised within this sector. Out of the 9 new LICs, 4 LICs offered direct exposure to international equities. The prospect of gaining more offshore exposure and potential depreciation of the Australian dollar could lead to more LICs with international mandates. Especially as we still see a demand for these products from managers with propelling investment strategies and a proven track record. Table 7: IPOs for 2015

Graph 1: Money raised from LIC IPOs - ‘03 to ‘15

Listed Shares Issued

Price

Raised

May-15

125,699,581 $

1.00

$ 125,699,581

ALI

Jul-15

143,063,314 $

2.00

$ 286,126,628

GC1

Apr-15

21,687,114 $

1.00

$

21,687,114

CIE FGG

Aug-15

71,451,002 $

1.00

$

71,451,002

Sep-15

274,672,167 $

1.10

$ 302,139,384

EAI

Sep-15

120,000,001 $

1.00

$ 120,000,001

PAI

Sep-15

292,869,649 $

1.00

$ 292,869,649

AEG 8EC

Dec-15

90,909,090 $

1.10

$

99,999,999

Dec-15

33,067,013 $

1.00

$

33,067,013

WDE

$1,353,040,371

$(m)

1500

1200

900

600

300

0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 SOURCE: COMPANY DATA, IRESS & BELL POTTER

Capital Raising A total of $1.2bn was raised in the secondary markets through a range of Dividend Reinvestment Plans (DRPs), Placements, Rights Issues, and Entitlement Offerings. Australian Foundation Investment Company (ASX: AFI) was the largest player raising $154m through a Share Purchase Plan and $51m from DRPs. However, MFF also came to market with sizeable raisings of ~ $130m. Table 8: CY15 Dividend Reinvestment Plans

Shares Issued

Raised

Shares Issued

Raised

81,362 $

79,321

DUI

1,107,869 $

3,820,554

AFI

8,631,441 $

51,844,830

EGI

55,495 $

57,160

AGF

8,798,021 $

9,929,447

EMF

633,072 $

1,107,876

AIB

68,628 $

58,157

FGX

236,065 $

251,386

ALF

13,768,793 $

18,240,577

FSI

242,686 $

398,473

ALR

85,493 $

97,259

1,955,263 $

2,184,600

AMH

4,133,137 $

3,513,166

HHV MFF

789,941 $

1,431,585

AQF ARG

426,766 $

749,638

MIR

1,827,620 $

4,454,835

4,723,217 $

37,300,556

MLT

1,711,152 $

7,633,044

282,298 $

2,297,757

PIC

7,784 $

42,456

AYF

22,114 $

138,933

BEL

645,290 $

89,136

BKI

3,472,567 $

5,987,616

CAM

830,833 $

750,070

CBC CDM

48,998 $

COT CTN

ABW

AUI AUP

77,096 $

71,699

PMC

2,380,958 $

4,231,225

SNC

211,743 $

186,334

TGG

925,484 $

1,165,277

TOP

698,933 $

321,509

WAA

215,968 $

208,409

47,871

WAM

20,791,814 $

39,878,900

4,757,660 $

6,638,887

WAX

8,865,079 $

10,497,959

7,500,000 $

600,000

WHF

797,439 $

3,388,624

2,269,913 $

2,195,817

$

221,890,943 SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

8

Market Update Table 9: CY15 Share Purchase Plans, Placements & Entitlements

Method

Shares Issued

Price

Raised

AFI

SPP

27,839,301 $

5.51

$ 153,394,549

AFI

Conversion

2,047,700 $

5.09

$

10,415,421

SPP

7,787,690 $

7.75

$

60,354,598

AUI

Entitlem ent

13,692,944 $

6.50

$

89,004,136

BAF

Entitlem ent

7,691,243 $

1.00

$

7,691,243

BAF

Shortfall

12,440,691 $

1.00

$

12,440,691

CDM

Placem ent

12,793,415 $

1.43

$

18,294,583

CYA

Entitlem ent

13,644,284 $

0.85

$

11,543,064

SPP

717,154 $

1.51

$

1,082,903

GVF

Placem ents

6,881,512 $

1.11

$

7,638,478

HHV

Placem ents

28,300,000 $

1.26

$

35,658,000

MFF

Entitlem ent

79,778,586 $

1.60

$ 127,645,738

ARG

FSI

MIR

SPP

11,867,227 $

2.20

$

26,107,899

MLT

SPP

7,746,892 $

4.18

$

32,382,009

SNC

SPP

3,629,251 $

0.88

$

3,193,741

SNC

Placem ent

4,204,164 $

0.88

$

3,699,664

TGG

Entitlem ent

49,747,731 $

1.30

$

64,672,050

TGG

64,672,050

Entitlem ent

49,747,731 $

1.30

$

WAM

SPP

54,369,870 $

1.90

$ 103,302,753

WAM

Placem ents

47,440,000 $

1.90

$

90,136,000

SPP

2,943,611 $

4.64

$

13,658,355

WHF

$ 936,987,925

SOURCE: COMPANY DATA, IRESS & BELL POTTER

Options Options continue to be a fantastic source of capital for LICs in 2015. A total of $372m was gain through the exercise of options in what was a volatile year for investors. Nearly half the funds raised were driven by PM Capital Global Opp Fund (ASX:PGF) who managed to get all its listed options exercised (some via a shortfall placement after its options expired), essentially doubling the size of the fund. Unfortunately, fair chunk of options were not exercised before exipiry as many of these stocks traded below its exercise price. Table 10: CY15 Lapsed Options Exercise Price

Not Exercised

Potential Capital Lost

Expiry

NCCO

$

1.00

1,384,311 $

1,384,311

01-Feb-15

WAXO

$

1.20

45,367,797 $

54,441,356

17-Jun-15

SNCO

$

1.00

33,922,644 $

33,922,644

24-Jul-15

NCCOA

$

1.13

11,789,026 $

13,321,599

01-Aug-15

CDMO

$

1.43

81,007,591 $

115,840,855

31-Aug-15

WICO

$

1.30

12,119,213 $

15,754,977

31-Aug-15

OZGO

$

0.23

34,476,161 $

7,929,517

31-Aug-15

CAMO

$

1.04

80,727,919 $

83,957,036

20-Oct-15

BAFO

$

0.98

13,177,310 $

12,949,343

16-Dec-15

$

339,501,638 SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

9

Market Update Table 11: CY15 Options Exercised Exercise Price

Exercised

Raised

Expiry

NCCO

$

1.00

9,968,027 $

9,968,027

01-Feb-15

WAXO

$

1.20

20,511,372 $

24,613,646

17-Jun-15

PGFO

$

1.00

173,181,200 $

173,181,200

30-Jun-15

SNCO

$

1.00

1,076,356 $

1,076,356

24-Jul-15

CDMO

$

1.43

50,922,186 $

72,818,726

31-Aug-15

CAMO

$

1.04

898 $

934

20-Oct-15

BAFO

$

0.98

39,795,493 $

39,107,317

16-Dec-15

QVEO

$

1.00

18,334,491 $

18,334,491

15-Mar-16

GVFO

$

1.00

11,083,878 $

11,083,878

17-Mar-16

PICO

$

1.00

667,500 $

667,500

10-Jun-16

OZGO

$

0.18

5,790 $

1,143

31-Aug-16

WICOA

$

1.30

275 $

326

31-Aug-16

FGXO

$

1.10

2,152,877 $

2,368,165

16-Sep-16

CBCO

$

1.00

25,100 $

25,100

30-Sep-16

NACO

$

1.00

7,500 $

7,500

30-Nov-16

ALIO

$

2.00

19,000 $

38,000

31-Mar-17

PAIO

$

1.00

241,600 $

241,600

15-May-17

FGGO

$

1.10

507,000 $

557,700

15-Sep-17

MFFO

$

1.00

17,315,096 $

17,825,885

31-Oct-17

EGIO

$

1.00

529,000 $

529,000

10-Apr-18

$

372,446,494 SOURCE: COMPANY DATA, IRESS & BELL POTTER

Table 12 highlights the potential capital to be raised from the remaining outstanding LIC options. Twelve out of the eighteen LICs will be expiring in 2016, however, majority of these options (ASX: 8EC, BTI, BST, CBC, PAF, PIC, WDE) are trading below the exercise price. This would suggest that only a fraction of these options will be exercised within this period. Table 12: Outstanding Options Stock Price Exercise Price

Outstanding Options

Potentially Raise

Expiry

QVEO

$

1.04

$

1.00

166,278,909 $

166,278,909

15-Mar-16

GVFO

$

1.02

$

1.00

50,740,734 $

50,740,734

17-Mar-16

BTIO

$

1.00

$

1.00

58,336,509 $

58,336,509

31-Mar-16

PAFO

$

0.96

$

1.00

55,087,500 $

55,087,500

31-May-16

PICO

$

0.98

$

1.00

249,726,777 $

249,726,777

10-Jun-16

BSTO

$

1.00

$

1.00

16,022,500 $

16,022,500

17-Aug-16

GC1O

$

1.01

$

1.00

21,687,113 $

21,687,113

18-Aug-16

FGXO

$

1.16

$

1.10

179,482,847 $

197,431,132

16-Sep-16

CBCO

$

0.95

$

1.00

24,214,499 $

24,214,499

30-Sep-16

WDEO

$

0.82

$

1.00

115,904,462 $

115,904,462

23-Nov-16

NACO

$

1.01

$

1.00

21,492,500 $

21,492,500

30-Nov-16

8ECO

$

0.97

$

1.00

16,528,506 $

16,528,506

12-Dec-16

ALIO

$

1.75

$

2.00

143,044,214 $

286,088,428

31-Mar-17

PAIO

$

1.03

$

1.00

292,628,046 $

292,628,046

15-May-17

FGGO

$

1.17

$

1.10

274,165,166 $

301,581,683

15-Sep-17

MFFO

$

2.10

$

0.9964

78,240,077 $

77,958,413

31-Oct-17

CIEO

$

0.99

$

1.00

50,000,000 $

50,000,000

30-Mar-18

EGIO

$

1.05

$

1.00

33,599,177 $

33,599,177

10-Apr-18

$

2,035,306,887 SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

10

Universe Summary We note we have included 5 new LICs into our coverage - 3 with domestic mandates (BTI, CBC and QVE) and 2 with international exposure (ALI and FGG). On a Weighted Average basis, the LICs within the Bell Potter universe are trading at an average premium to pre-tax NTA of 4.0% as at 31 Dec 2015, a slight fall from the previous quarter. We saw the Weighted Average premium of Domestic LICs contract from the prior quarter, 6.4% to 5.0% premium. International LICs also saw its discount contract from the previous quarter– going from a 8.1% discount to 3.6% discount. Table 13: Current Share Price Premium/Discount to NTA and Yield

ASX Code Company name Domestic Equity AFIC AFI

Market Cap Investment Mandate ($m)

Price ($)

Prem/ Prem/ 12 Mth Net Gross Indirect Pre-tax (Disc) to (Disc) to Dividend Dividend Dividend Cost NTA pre-tax Post-tax post-tax Per Share Yield Franking Yield Ratio ($) NTA (%) NTA ($) NTA (%) ($)* (%)* (%) (%)* (%)

Large

6,529

5.95

5.63

5.7

4.87

22.2

0.230

3.9

100

5.5

0.16

ARG

Argo Investments

Large

5,416

8.00

7.28

9.9

6.47

23.6

0.295

3.7

100

5.3

0.15

DJW

Djerriw arrh Investments

Large

940

4.30

3.21

34.0

3.27

31.5

0.260

6.0

100

8.6

0.45

AUI

Australian United

Large

811

7.40

7.83

-5.5

6.93

6.8

0.340

4.6

100

6.6

0.10

CYA

Century Australia

Large

68

0.83

0.90

-8.0

0.93

-11.4

0.033

3.9

100

5.6

1.15

MLT

Milton Corporation

Large/Medium

2,972

4.58

4.50

1.8

3.98

15.1

0.188

4.1

100

5.9

0.12

BKI

BKI Investment

Large/Medium

958

1.69

1.61

4.7

1.51

11.6

0.072

4.3

100

6.1

0.18

CIN

Carlton Investments

Large/Medium

898

33.91

38.66

-12.3

31.54

7.5

1.080

3.2

100

4.5

0.09

DUI

Diversified United

Large/Medium

706

3.41

3.59

-5.0

3.18

7.2

0.140

4.1

100

5.9

0.14

WHF

Whitefield

Large/Medium

348

4.34

4.79

-9.4

4.39

-1.1

0.170

3.9

100

5.6

0.38

AMH

AMCIL

Large/Medium

220

0.90

0.93

-3.8

0.86

4.1

0.040

4.5

100

6.4

0.65

QVE

QV Equities

Large/Medium

210

1.04

1.08

-3.8

1.05

-1.5

0.020

1.9

100

2.8

1.04

CAM

Clime Capital

Large/Medium

71

0.88

0.94

-6.9

0.94

-6.9

0.047

5.4

100

7.7

1.79

FSI

Flagship Investments

Large/Medium

36

1.43

1.86

-23.2

1.75

-18.3

0.073

5.1

100

7.3

1.43

CBC

CBG Capital

Large/Medium

23

0.95

1.06

-10.2

1.03

-7.4

0.015

1.6

100

2.3

1.36

WAM

WAM Capital

Medium/Small

992

2.12

1.97

7.7

1.88

12.8

0.140

6.6

100

9.4

2.67

MIR

Mirrabooka

Medium/Small

369

2.58

2.43

6.2

2.18

18.3

0.170

6.6

100

9.4

0.66

WIC

WestOz Investment Co.

Medium/Small

110

0.85

0.96

-11.1

1.01

-15.8

0.090

10.6

100

15.1

1.31

WAX

WAM Research

Medium/Small

223

1.29

1.20

7.3

1.20

7.4

0.080

6.2

100

8.9

4.31

OZG

Ozgrow th

Medium/Small

43

0.12

0.15

-19.5

0.16

-24.1

0.015

12.5

100

17.9

1.51

CTN

Contango Microcap

Small/Micro

153

0.95

1.14

-16.5

1.08

-11.9

0.077

8.1

50

9.8

+n/a

ACQ

Acorn Capital

Small/Micro

42

0.85

1.02

-16.3

0.99

-14.0

0.000

0.0

0

0.0

1.78

BTI

Bailador Tech Investments Unlisted Tech

ALF

Australian Leaders Fund

62

1.00

1.25

-20.4

1.13

-11.8

0.000

0.0

0

0.0

3.49

Long/Short

375

1.40

1.36

2.6

1.37

1.8

0.100

7.2

100

10.2

1.25

CDM

Cadence Capital

Long/Short

412

1.54

1.34

14.4

1.37

12.0

0.110

7.2

100

10.2

2.20

WAA

WAM Active

Long/Short

37

1.07

1.05

2.0

1.05

2.1

0.025

2.3

100

3.3

2.70

NCC

Naos Emerging OpportunitiesLong/Short

46

0.98

1.12

-12.9

1.09

-10.6

0.063

6.4

100

9.2

2.58

WMK

Watermark Market Neutral

85

0.98

1.08

-9.7

1.07

-8.9

0.045

4.6

59

3.9

1.82

0.0

0.01

0.0

Global

975

2.10

2.10

-0.1

1.82

15.6

0.020

1.0

50

1.1

1.61

0.110

5.8

100

8.3

1.94

International Equity Magellan Flagship Fund MFF

Market Neutral

0.0

0.01

PMC

Platinum Capital

Global

446

1.90

1.58

20.3

1.55

22.6

TGG

Templeton Global Grow th

Global

307

1.23

1.39

-11.8

1.35

-9.1

0.041

3.3

17

3.6

1.14

HHV

Hunter Hall Global Value

Global

286

1.18

1.34

-12.2

1.28

-7.6

0.120

10.2

6

10.4

1.90

PGF

PM Capital Global Opp

Global

351

1.01

1.13

-10.7

1.11

-8.9

0.000

0.0

n/a

0.0

1.52

GVF

Global Value Fund

Global (Multi Assets)

74

1.02

1.15

-11.2

1.11

-7.8

0.020

2.0

100

2.8

4.81

ALI

Argo Global Infrastructure Global (Listed Infra)

250

1.75

1.87

-6.4

1.89

-7.4

0.000

0.0

n/a

0.0

n/a

PAF

PM Capital Asian Opp

53

0.96

1.07

-10.6

1.09

-12.0

0.000

0.0

n/a

0.0

2.09

AGF

AMP Capital China Grow th China

429

1.11

1.31

-15.3

1.31

-15.3

0.339

30.5

0

30.5

1.97

0.0

0.01

0.0

Asia

Specialist

0.0

HHY

Hastings High Yield

Fixed income

10

0.10

0.12

-18.8

0.12

-18.8

0.000

n/a"

0

n/a"

2.77

ABW

Aurora Absolute

Income

16

0.95

0.95

-0.3

0.95

-0.3

0.044

4.7

0

4.7

1.07

FGX

Future Gen Invest Co

Fund of Funds

217

1.16

1.19

-2.5

1.18

-1.3

0.020

1.7

100

2.5

0.16

FGG

Future Gen Global Invest

Gbl Funds of Funds

322

1.17

1.07

9.5

1.07

8.9

0.000

0.0

n/a

0.0

n/a

SNC

Sandon Capital

Activist

38

0.85

0.98

-13.2

0.97

-12.2

0.050

5.9

100

8.4

2.60

6.3 6.1 5.9 8.1 6.1 7.0 3.4

1.59 0.59 0.28 1.76 0.46 1.63 0.55

Arithm etic Average (All) Weighted Average (All) Weighted Average (Domestic Market Cap - Over $500m) Weighted Average (Domestic Market Cap - Under $500m) Weighted Average (Domestic All) Weighted Average (International Equity) Weighted Average (Specialist)




-4.3 4.0 6.0 -1.5 5.0 -3.6 7.3

-0.3 15.0 19.2 1.5 17.0 2.4 7.9

4.8 4.5 4.1 5.8 4.3 6.5 2.5

*12 month historical dividends including Special Dividends. *ICR with performance fee. “HHY distributed a return of capital in the last 12 months. CTN has purchased the rights of CAML(which is an assets manager) - as such the ICR is not reflective of the underlying vehicle SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

11

Investment Performance In the Table below, we have evaluated our LICs using the performance of both the pre-tax NTA and share price. The pre-tax NTA data seeks to measure the performance of the underlying investments of the Fund. Whereas, the share price data measures the performance of the security as it trades on the ASX. However, some of this terminology is a little misleading as the pre-tax NTA actually reflects tax associated with realised capital gains (tax applicable on positions that have been exited) but not unrealised capital gains (tax applicable on positions that have not been exited). The measurement of a LIC’s performance is calculated after all operating expenses, provision and payment of both income and realised capital gains tax and the reinvestment of dividends, but does not incorporate franking. LIC returns will consequently be understated relative to the Index return given that the Benchmarks do not factor in operating costs or taxation. The performance of Unlisted Unit Trusts are not measured on an after tax basis and are therefore, generally, not a valid comparison. Table 14: Pre-tax NTA and Share Price Performance Pre-tax NTA ASX Code

ASX Listed Investment Companies

Domestic Equity AFIC AFI ARG

ASX Code

Performance (%) Yr 1

Yr 3

Yr 5

Share price Value-add+ (%)

Performance (%)

Yr 7 Yr 10

Yr 1

Yr 3 Yr 5 Yr 7 Yr 10

Yr 1

Yr 3

Yr 5

Value-add+ (%)

Yr 7 Yr 10

Yr 1

Yr 3 Yr 5 Yr 7 Yr 10

AFI

1.0

8.7

7.3

10.4

6.5

-1.6

-0.5

0.3

0.4

0.9

2.1

9.7

8.2

10.6

7.6

-1.7

0.4

1.7

0.4

1.9

Argo Investments

ARG

2.8

9.3

7.3

10.2

5.6

0.2

0.1

0.3

0.2

0.0

7.0

13.3

9.2

10.5

6.4

3.2

4.0

2.7

0.3

0.7

DJW

Djerriw arrh Investments

DJW

-2.6

5.0

4.7

8.0

4.6

-5.2

-4.2

-2.3

-2.0

-1.0

-1.2

7.8

6.8

9.5

6.7

-5.0

-1.5

0.3

-0.7

1.0

AUI

Australian United

AUI

-2.2

7.7

5.6

9.7

5.1

-5.0

-1.3

-1.1

-0.2

-0.4

-1.9

8.9

6.6

9.6

5.6

-5.7

-0.4

0.1

-0.6

-0.1

CYA

Century Australia

CYA

1.2

7.5

3.8

6.8

3.2

-1.6

-1.5

-2.9

-3.1

-2.3

-2.6

9.7

5.2

10.0

4.1

-6.4

0.4

-1.3 -0.2

-1.6

MLT

Milton Corporation

MLT

9.5

11.4

9.5

11.4

6.5

5.7

2.1

3.0

1.2

0.8

6.5

13.6 11.7

11.8

6.3

2.7

4.3

5.2

1.6

0.6

BKI

BKI Investment

BKI

3.1

8.3

7.4

10.3

6.1

0.3

-0.7

0.7

0.4

0.6

10.9

11.9 11.4

14.0

8.1

7.1

2.6

4.9

3.8

2.4

CIN

Carlton Investments

CIN

24.7

22.2

16.0 17.1

11.3

22.1

13.0

9.0

7.1

5.7

24.2

24.3 18.3

17.8

11.6

20.4

15.0 11.8 7.6

5.9

DUI

Diversified United

DUI

1.3

9.9

7.2

5.7

-1.5

0.9

0.5

0.3

0.2

4.4

11.6

10.1

7.0

0.6

2.3

10.2

8.5

2.0

-0.1

1.3

WHF

Whitefield

WHF

8.8

16.5

12.8 12.8

5.8

0.7

1.3

-0.7

-0.9

-1.5

6.6

16.7 13.9

12.8

6.6

-1.5

1.5

0.4

-0.9

-0.7

AMH

AMCIL

AMH

12.2

10.9

9.4

13.1

8.0

9.6

1.7

2.4

3.1

2.4

6.0

11.0 12.3

14.5

10.5

2.2

1.7

5.8

4.3

4.8

QVE

QV Equities

QVE

9.0

n/a

n/a

n/a

n/a

-1.4

n/a

2.4

3.1

n/a

1.4

n/a

n/a

n/a

n/a

-1.4

n/a

n/a

n/a

n/a

CAM

Clime Capital

CAM

0.6

-0.7

1.2

7.9

5.6

-3.2 -10.0 -5.3

-2.3

-0.1

-4.1

0.2

6.2

11.1

6.4

-7.9

-9.1 -0.3

0.9

0.7

FSI

Flagship Investments

FSI

12.0

13.7

9.7

11.2

6.3

8.2

4.4

3.2

1.0

0.6

-0.1

9.6

6.0

8.3

5.6

-3.9

0.3

-0.5 -1.9

-0.1

CBC

CBG Capital

CBC

8.7

n/a

n/a

n/a

n/a

6.1

n/a

n/a

n/a

n/a

-0.9

n/a

n/a

n/a

n/a

-4.7

n/a

n/a

n/a

n/a

WAM

WAM Capital

WAM

18.2

11.7

10.2 13.5

10.3

14.4

2.4

3.7

3.3

4.6

13.2

15.8 15.6

21.9

12.2

9.4

6.5

9.1 11.7

6.5

MIR

Mirrabooka

MIR

17.7

14.8

11.9 14.1

8.8

6.9

6.8

9.7

5.6

5.7

7.8

13.4 14.5

16.4

10.3

4.0

4.1

8.0

WIC

WestOz Investment Co.

WIC

2.0

-6.0

-4.2

-1.6

n/a

-8.2

-7.7

-1.7

-8.2

n/a

-11.7

0.3

2.5

2.8

n/a

WAX

WAM Research

WAX

17.6

15.2

12.5 12.2

6.9

13.8

5.9

6.0

2.0

1.2

18.7

19.8 20.8

22.3

OZG

Ozgrow th

OZG

-6.1

-8.1

-4.4

5.5

n/a

-16.3 -9.8 -10.9 -1.1

n/a

-26.3

-4.9

1.0

10.4

CTN

Contango Microcap

CTN

11.2

6.1

-1.1

7.7

4.9

1.0

4.4

1.4

1.1

3.5

-1.8

6.3

2.1

ACQ

Acorn Capital

ACQ

16.8

n/a

n/a

n/a

n/a

6.6

n/a

n/a

n/a

n/a

16.4

n/a

n/a

6.2

4.6

-15.5 -9.0 -4.0 -7.4

n/a

10.7

14.9

5.0

n/a

-30.1 -14.2 -5.5

0.2

13.4

6.8

-5.6

-3.0 -4.4

3.2

1.1

n/a

n/a

6.2

n/a

n/a

n/a

n/a

10.5 14.3 12.1

n/a

BTI

Bailador Tech Investments

BTI

14.4

n/a

n/a

n/a

n/a

6.4

n/a

n/a

n/a

n/a

17.1

n/a

n/a

n/a

n/a

13.3

n/a

n/a

n/a

n/a

ALF

Australian Leaders Fund

ALF

13.6

9.5

8.9

15.2

10.3

9.8

0.2

2.4

5.0

4.6

5.5

10.8 14.1

22.3

13.7

1.7

1.5

7.6 12.1

8.0

CDM

Cadence Capital

CDM

7.5

8.7

9.8

16.8

n/a

3.7

-0.6

3.3

6.6

n/a

16.4

10.8 20.5

22.0

n/a

12.6

1.5

14.0 11.8

n/a

WAA

WAM Active

WAA

9.6

6.4

5.2

9.1

n/a

5.8

-2.9

-1.3

-1.1

n/a

0.5

5.8

8.9

13.3

n/a

-3.3

-3.5

2.4

3.1

n/a

NCC

Naos Emerging Opportunities

NCC

1.3

n/a

n/a

n/a

n/a

-8.9

n/a

n/a

n/a

n/a

-0.4

n/a

n/a

n/a

n/a

-4.2

n/a

n/a

n/a

n/a

WMK

Watermark Market Neutral

WMK

18.8

n/a

n/a

n/a

n/a

16.7

n/a

n/a

n/a

n/a

15.1

n/a

n/a

n/a

n/a

11.3

n/a

n/a

n/a

n/a

International Equity MFF

Magellan Flagship Fund

MFF

13.3

31.8

24.5 18.2

n/a

4.4

10.9 11.7

9.9

n/a

16.8

32.8 25.8

21.2

n/a

7.9

11.9 13.0 12.9

n/a

PMC

Platinum Capital

PMC

2.3

15.8

9.5

9.1

4.9

-7.1

-5.4

-4.0

-1.1

0.1

10.7

27.7

12.3

4.5

1.3

6.5

2.1

-0.3 -0.1

9.9

-3.6

TGG

Templeton Global Grow th

TGG

3.3

17.4

12.2

7.5

2.8

-6.1

-3.8

-1.3

-2.7

-2.0

-9.5

20.3 12.1

9.2

6.8

-18.9 -0.9 -1.4 -1.0

HHV

Hunter Hall Global Value

HHV

8.4

18.5

11.2 14.6

4.8

-2.6

-4.9

-3.9

4.0

-0.2

0.4

21.2 12.1

16.1

6.5

-10.6 -2.2 -3.0

5.5

1.5

PGF

PM Capital Global Opp

PGF

-0.5

n/a

n/a

n/a

n/a

-11.5

n/a

n/a

n/a

n/a

-5.2

n/a

n/a

n/a

-16.2

n/a

n/a

GVF

Global Value Fund

GVF

12.2

n/a

n/a

n/a

n/a

6.0

n/a

n/a

n/a

n/a

-0.5

n/a

n/a

n/a

n/a

-9.4

n/a

n/a

n/a

n/a

ALI

Argo Global Infrastructure

ALI

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

PAF

PM Capital Asian Opp

PAF

2.8

n/a

n/a

n/a

n/a

1.1

n/a

n/a

n/a

n/a

0.0

n/a

n/a

n/a

n/a

-1.7

n/a

n/a

n/a

n/a

AGF

AMP Capital China Grow th

AGF

12.2

26.3

13.0

7.7

n/a

-3.0

-3.4

-0.4

-5.5

n/a

34.1

31.8 15.1

11.7

n/a

18.9

2.1

1.7

-1.5

n/a

n/a

n/a

n/a

n/a

Specialist HHY

Hastings High Yield

HHY

-51.3

-7.3

-4.1

-2.2

n/a

-61.3 -17.3 -14.1 -12.2

n/a

-45.7

0.4

3.5

10.1

n/a

-52.2 -13.6 -8.6 -1.4

ABW

Aurora Absolute

ABW

1.4

1.7

n/a

n/a

n/a

-2.4

-7.6

n/a

n/a

n/a

-4.0

1.4

n/a

n/a

n/a

-7.8

-7.9

n/a

n/a

n/a

FGX

Future Generation Invest Co

FGX

12.4

n/a

n/a

n/a

n/a

8.6

n/a

n/a

n/a

n/a

13.0

n/a

n/a

n/a

n/a

9.2

n/a

n/a

n/a

n/a

FGG

Future Gen Global Invest

FGG

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

SNC

Sandon Capital

SNC

2.6

n/a

n/a

n/a

n/a

-7.6

n/a

n/a

n/a

n/a

-1.6

n/a

n/a

n/a

n/a

-11.8

n/a

n/a

n/a

n/a

CDM: In May 2011 CDM received $0.22 per CDM share of franking credits when RHG returned the majority of its assets in the form of a fully franked dividend. At the time, CDM shares were trading at $1.25. These franking credits were worth 17.6% of the CDM share price at the time and are not reflected in our performance calculations as the calculations are based on pre-tax NTA and not post-tax NTA. SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

12

Investment Performance (continued) In order to assess a LIC’s performance, NTA and share price need to be evaluated with respect to the relative mandate and/or benchmark, given varying outcomes from different styles of investment. Hence, for the Domestic LICs we have categorised the LIC’s Mandate into those with a Large, Large to Medium, Medium to Small, and Small Market Capitalisation investment focus, Long/Short/Market Neutral, International, and Specialist investment focuses following an analysis of the LIC’s Top Stock Holdings. In general, the NTA has been benchmarked against the relative indices preferred by the Manager and these should be most reflective of its mandate. The share price of each LIC, apart from International and Specialist LICs, has been benchmarked against the All Ordinaries Accumulation Index, given this is the broadest index on the ASX and the exchange in which each LIC trades. This is arguably a less relevant benchmark. Our value-add columns seek to quantify the value generated by the Manager. It is the difference between the performance of the share price and pre-tax NTA against the relevant benchmark. A positive value indicates outperformance against the Benchmark and a negative value indicates an underperformance. We view the pre-tax NTA value-add as the most relevant measure of management performance.

Historical Gross Dividend Yield Dividends are an important aspect of any investment decision. In the Graph below, we have included historical Net Dividend Yield and Gross Dividend Yield for the LICs in our universe. Nonetheless, investors must realise that although historical yield is clearly a key consideration when selecting a LIC, it is no guarantee of future yield. Please note several LICs have recently entered the market and have not distributed a dividend yet. Graph 2: Historical Dividend Yield (Net and Gross) 35% Lrg Cap mandate

30%

Med/Sml Cap mandate

Lrg/Med Cap mandate

Long/Short & Neutral

Small

Specialist

International

Dividend Yield

25%

20%

15%

10%

Gross Yield

SNC

FGX

FGG

ABW

AGF

HHY*

ALI

PAF

GVF

PGF

HHV

TGG

MFF

PMC

NCC

WMK

WAA

CDM

BTI

ALF

CTN

ACQ

OZG

WAX

MIR

WIC

WAM

FSI

CBC

QVE

CAM

AMH

DUI

WHF

BKI

CIN

MLT

AUI

CYA

DJW

AFI

0%

ARG

5%

Net Yield *No dividend yield as HHY distributed a capital return over the last 12 months *Includes Special Dividends SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

13

Premium/Discount to NTA We have categorised our universe of LICs according to the percentage premium or discount the share price trades at relative to the pre-tax NTA. Table 15: Share Price Premium/Discount versus Pre-Tax NTA Substantial premium

%

DJW PMC CDM ARG WAM WAX MIR

Djerriw arrh Investments Platinum Capital Cadence Capital Argo Investments WAM Capital WAM Research Mirrabooka

AFI

AFIC

34.0 20.3 14.4 9.9 7.7 7.3 6.2 5.7

Approximately in line

%

BKI ALF WAA MLT MFF ABW FGX

BKI Investment Australian Leaders Fund WAM Active Milton Corporation Magellan Flagship Fund Aurora Absolute Future Gen Invest Co

AMH QVE

AMCIL QV Equities

DUI AUI

Diversified United Australian United

CAM WHF

Clime Capital Whitefield

4.7 2.6 2.0 1.8 -0.1 -0.3 -2.5 -3.8 -3.8 -5.0 -5.5 -6.9 -9.4

Substantial discount CYA

%

HHV CIN

Century Australia Watermark Market Neutral PM Capital Asian Opp PM Capital Global Opp WestOz Investment Co. Global Value Fund Templeton Global Grow th Hunter Hall Global Value Carlton Investments

NCC SNC

Naos Emerging Opportunities Sandon Capital

AGF ACQ

AMP Capital China Grow th Acorn Capital

CTN HHY

Contango Microcap Hastings High Yield

-8.0 -9.7 -10.6 -10.7 -11.1 -11.2 -11.8 -12.2 -12.3 -12.9 -13.2 -15.3 -16.3 -16.5 -18.8

OZG FSI

Ozgrow th Flagship Investments

-23.2

WMK PAF PGF WIC GVF TGG

-19.5

SOURCE: COMPANY DATA, IRESS & BELL POTTER

LICs often trade at a consistent premium or discount to NTA, with the standard deviation providing a measure of the range in which a LIC’s premium/discount normally falls. By determining each LIC’s average premium/discount we can look for anomalies between average premiums/discounts to NTA and current premiums/discounts to NTA. We have calculated each LIC’s 5-year average (please note a number of LICs have a history less than 5 years and therefore not included in the graph) share price premium/discount to reported pre-tax NTA as well as its standard deviation from that average, which we portray in the below graph. Here, we are trying to convey whether or not a LIC is cheap or expensive compared to its historical average. Graph 3: Share Price Premium/Discount to Pre-Tax NTA Relative to 5-year Average 3.0x

1.0x

0.0x

HHY*

AGF

HHV

TGG

PMC

MFF

WAA

CDM

ALF

CTN

OZG

WAX

WIC

MIR

WAM

FSI

International/Specialist

Long/Short/ Neutral

Med-Sml Cap mandate

CAM

AMH

WHF

DUI

CIN

MLT

CYA

AUI

DJW

AFI

-2.0x

BKI

Lrg-Med Cap mandate

Lrg Cap mandate

-1.0x

ARG

Standard Deviation

2.0x

SOURCE: COMPANY DATA, IRESS & BELL POTTER

The average share price discount to pre-tax NTA remained steady from the previous quarter at 0.7x. In the Large Market Capitalisation investment focus, AUI looked the most reasonably valued. LICs with Large to Medium Capitalisation investment mandates continue to trade at substantial premiums, apart from FSI and WHF. Medium to Small and Long/Short mandates are now starting to look slightly attractive on a historical premium/discount basis. International focused LICs have performed exceptionally well over the past year in particular, and have traded at historical highs in comparison to their NTAs.

LISTED INVESTMENT COMPANIES.

14

Premium/Discount to NTA (continued) In Graph 4 we have provided some context to the share price premium or discount to pre-tax NTA. Pre-tax NTA reflects realised capital gains (tax applicable on positions that have been exited) but not unrealised capital gains (tax applicable on positions that have not been exited). Graph 4: Share Price Premium/Discount versus Pre-Tax NTA

Specialist

30% Med-Sml Cap mandate

20% 10% 0% -10%

FGX FGG SNC

PAF AGF HHY ABW

International

WMK MFF PMC TGG

ALF CDM WAA NCC

OZG CTN ACQ BTI

MIR WIC WAX

CAM FSI CBC WAM

Long/Short/ Neutral

HHV PGF GVF ALI

Lrg-Med Cap mandate

DUI WHF AMH QVE

-30%

Lrg Cap mandate

CYA MLT BKI CIN

-20%

AFI ARG DJW AUI

Share Price Prem/Disc to Pre-tax NTA

40%

SOURCE: COMPANY DATA, IRESS & BELL POTTER

Graph 5 shows the share price premium/discount against post-tax NTA. Post-tax NTA reflects realised (tax applicable on positions that have been exited) and unrealised capital gains (tax applicable on positions that have not been exited). While this measure is arguably less relevant, it does provide additional comparison, particularly when viewed with Graph 4. Post-tax NTA is most useful in a wind-up scenario. Graph 5: Share Price Premium/Discount versus Post-Tax NTA

25% Specialist

15% 5% -5% -15%

FGG SNC

HHY ABW FGX

ALI PAF AGF

HHV PGF GVF

PMC TGG

NCC WMK MFF

ALF CDM WAA

CTN ACQ BTI

WAX OZG

International

Long/Short/ Neutral

Med-Sml Cap mandate

CAM FSI CBC

WHF AMH QVE

CIN DUI

CYA MLT BKI

AFI

-35%

Lrg-Med Cap mandate

WAM MIR WIC

Lrg Cap mandate

-25%

ARG DJW AUI

Share Price Prem/Disc to Post-tax NTA

35%

SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

15

Premium/Discount to NTA (continued) Graphs 6 & 7 show the pre-tax NTA performance of each LIC, assuming dividends are reinvested, over the past 3 and 5 years. This is reflected by its position along the horizontal axis, with LICs further to the right having achieved higher returns. The Graphs also highlight the share price premium or discount to pre-tax NTA at which each LIC was trading at Quarter End. This is reflected by each LIC’s position along the vertical axis. Graphs 6 & 7: Share Price Premium/Discount vs Pre-Tax NTA Performance 40%

40%

30% PMC

20% CDM

WAA AUI

10% MFF

0%

MLT DUI AMH WHF TGG

PGF

CIN

CYA

PAF WIC

Premium to pre-tax NTA

WAM AFI WAX ALF BKI MIR

ABW FGX

CAM

ARG

CTN

GVF

HHV

HHY*

FSI

-20%

OZG

-15%

-10%

-10%

AGF

DJW

Premium/Discount to pre-tax NTA

Premium/Discount to pre-tax NTA

DJW

30%

PMC

20% CDM ARG AFI WAA

WAM BKI

WIC

DUI

WHF

0%

5%

10%

15%

20%

25%

30%

-30% 35%

CTN

-5%

Discount to pre-tax NTA

AGF

-20%

FSI

0%

3 Year pre-tax NTA return

-10%

TGG

HHV

HHY*

-10%

CIN

CYA

Discount to pre-tax NTA

-5%

0%

AMH

GVF PAF OZG

MFF

MLT

AUI

PGF

10%

MIR

ALF

FGX CAM

Premium to pre-tax NTA WAX

5%

10%

15%

20%

25%

-30% 30%

5 Year pre-tax NTA return SOURCE: COMPANY DATA, IRESS & BELL POTTER

Pre-tax NTA performance is one way of reflecting the performance of a LIC’s management and the standard deviation of the pre-tax NTA performance can be used as a measure of risk by reflecting the movement or dispersion from the average return. The below graphs can therefore give an indication of a LIC’s risk-return over the time periods.

16%

5 year pre-tax NTA performance St. Dev.

3 year pre-tax NTA performance St. Dev.

Graphs 8 & 9: Pre-Tax NTA Performance Standard Deviation vs Pre-Tax NTA Performance

CTN AUI

14%

CYA DJW

12%

WHF DUI TGG

AFI PMC

XAOAI MLT BKI

WMK

FSI

CIN

ARG AMH

10%

HHV MIR

CDM ALF

8%

WAM

WAA WAX

6% 4% 0%

5%

10%

15%

20%

25%

3 year pre-tax NTA performance Outliers: Stock (perf, std dev) WIC (-6.0%, 16.1%) OZG (-8.1%, 18.3%) AGF (26.3%, 30.6%) MFF (31.8%, 13.2%)

16% 14%

CYA

AUI

DUI WHF

ALF DJW

12%

AFI XAOAI

TGG PMC

ARG

FSI

HHV

MLT

WMK CIN

BKI

10%

CAM

AMH CDM

MIR

WAM

8% WAA

6%

WAX

4% 0%

5%

10%

15%

20%

5 year pre-tax NTA performance Outliers: Stock (perf, std dev) CTN (-1.1%, 17.3%) WIC (-4.2%, 16.6%) OZG (-4.4%, 18.0%) AGF ( 13.0%, 26.9%) MFF (24.5%, 12.9%) SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

16

Premium/Discount to NTA (continued) LICs by their very nature can trade at either a premium or discount to pre-tax NTA. However, from a quantitative perspective, we have noted a tendency for LICs to revert to their mean premium or discount through the Cycle. As such, investors need to be cognisant of how a LIC trades through the Economic Cycle to ensure an investment is timed appropriately. As noted in our quarterly in September 2015, Large LICs (Market Cap > $500m) appear to behave differently from Small LICs (Market Cap < $500m) through the Economic Cycle. Large LICs tend to trade at a substantial premium to pre-tax NTA in perceivably difficult or uneasy market conditions and a lower premium to pre-tax NTA in perceivably improving market conditions. One could argue that during uneasy market conditions investors prefer the safety of Large LICs with an established track record and hence push them up into substantial premiums. Whereas, in more favourable market conditions, investors have a tendency to view large LICs as a lower return investment alternative and instead favour smaller and more exotic LICs, hence driving large LICs’ premiums lower. Graph 10: Large Cap Focused LICs’ Average Share Price Premium/Discount to Pre-tax NTA 8,000

20%

All
Ords
(LHS)

Oct 2007: Market peak

15%

6,000

10%

5,000

5%

4,000

0%

3,000

-5%

2,000

Sept 2001: Sept 11 attacks

1,000

0 Dec
00

Dec
01

Sept 2008: Lehman Apr 2007: US subprime Brothers collapse crisis

Mar 2003: Iraq war begins Dec
02

Dec
03

Dec
04

Dec
05

Dec
06

Dec
07

Dec
08

May 2010: First Greek Bailout Dec
09

Dec
10

Jun 2015: Chinese Share Market Crash

Feb 2012: Second Greek Bailout Dec
11

Dec
12

Dec
13

Dec
14

Premium/Discount

7,000

All Ordinar ies Index

Average
Premium/Discount
(RHS)

Feb 2003: Market trough

-10%

-15%

-20% Dec
15

SOURCE: COMPANY DATA, IRESS & BELL POTTER

However, it is interesting to note, that we are currently in a period where Large LICs are deviating from its norm. Since early 2013, we see Large LICs trading at a premium to pre-tax NTA - even in a rising market. This phenomenon exist due to an increase of demand for Large LICs. We associate this greater demand to two underlying factors.

• Future of Financial Advice (FoFA) reforms. Since July 2013, commissions paid to financial planners by providers of managed fund have been banned going forward. This has removed the incentive for financial planners to use Managed Funds over LICs or ETFs.

• A competitive dividend yield in comparison to the ASX200. In July 2010, there was a significant change in the Corporation Act that have paved the way for LICs to offer greater consistency in dividends. Previously, companies could only pay a dividend if they had an accounting profit, which saw a number of LICs being unable to pay dividends through the GFC. However, following the introduction of the solvency test, LICs now have greater flexibility to offer sustainable dividend polices even with the absence of an accounting profit.

LISTED INVESTMENT COMPANIES.

17

Premium/Discount to NTA (continued) Small LICs tend to operate in almost an opposing fashion. In general, Small LICs trade at a larger discount to pre-tax NTA, averaging an 10.9% discount over the last 8 years, which compares to the Large LICs 2.5% premium over the same period. Broadly speaking, as market confidence rises, Small LICs tend to trade at a smaller discount as investors’ confidence rises. However, as market conditions turn, these small discounts tend to turn into deep discounts. Graph 11: Small Cap Focused LICs’ Average Share Price Premium/Discount to Pre-tax NTA 8,000

20%

Average
Premium/Discount

Oct 2007: Market Peak

15%

Sept 2008: Lehman Br others collapse

All Ordinar ies Index

6,000

May 2010: First Greek Bailout

Feb 2012: Second Greek Bailout

10%

5,000

5%

4,000

0%

3,000

-5%

Jun 2015: Chinese Share Market Crash

2,000

Apr 2007: US subprime crisis

1,000

0 Dec
05

Dec
06

Feb 2009: Market Through Dec
07

Dec
08

Dec
09

Dec
10

Dec
11

Dec
12

Dec
13

Dec
14

Premium/Di scount

7,000

All
Ords

-10%

-15%

-20% Dec
15

SOURCE: COMPANY DATA, IRESS & BELL POTTER

The graph below shows International LICs’ discounts have historically been pretty much correlated with the global markets. These LICs traded at varying deep discounts when first introduced, for a combination of both the GFC made investors reluctant to hold international assets and international vehicles were originally not viewed as the yield making machines as domestic stocks. However as global share markets rose, so did the demand for these LICs—narrowing these discounts. While, as confidence falls within the global markets, we tend to see these discounts expand. Graph 12: International Cap Focused LICs’ Average Share Price Premium/Discount to Pre-tax NTA 7,000

20%

6,500

Sept 2008: Lehman Br others collapse

6,000

Average
Premium/Discount

MSCI

15%

Feb 2012: Second Greek Bailout

May 2010: First Greek Bailout

10%

5,500

0% 4,500 -5% 4,000

Jun 2015: Chinese Share Market Crash

3,500 3,000 2,500

Apr 2007: US subprime crisis

2,000 Dec
06

-10%

Premium/Di scount

MSCI World Index

5% 5,000

-15% -20%

Dec
07

Dec
08

Dec
09

Dec
10

Dec
11

Dec
12

Dec
13

Dec
14

-25% Dec
15

SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

18

LIC Indicative NTA LICs are only obligated to disclose their NTA at the end of each month and have 14 days to disclose this information to the Market. This means that an investor is only able to retrospectively gauge the value of the underlying NTA and for the remainder of the month be ignorant to the underlying value of the NTA. Bell Potter has sought to address this gap by providing an Indicative Live NTA. We calculate the Indicative NTA by tracking the underlying NTA each week. This is achieved by monitoring the percentage movements of the Disclosed Holdings and using an appropriate proxy to track the movement of the remaining positions. We also adjust the NTA when the security goes ex-dividend. The Indicative NTA works best with LICs that have a high percentage of investments concentrated in its Top 20 Holdings, regular disclosure of its holdings and cash position, lower turnover of its investments, and the absence of a performance fee.

Table 16: Indicative Premium/Discount to Pre-Tax NTA (as at 9 February 2016) Investment ASX Code Company Name

Share Fully Diluted Ind.

Mandate

Price

Pre-Tax NTA"

Indicative Prem/Disc"

Average Premium/Discount+ 1 year

3 years

5 years

10 years

AFI

AFIC"

Large

$

5.46 $

5.02

8.8%

3.4%

3.8%

0.7%

1.3%

ARG

Argo Investments

Large

$

7.58 $

6.66

13.9%

5.5%

2.3%

-0.9%

1.4%

DJW

Djerriwarrh Investments

Large

$

4.06 $

2.76

47.0%

30.3%

25.1%

20.5%

13.6%

AUI

Australian United Investments

Large

$

7.22 $

6.78

6.5%

-4.5%

-5.2%

-7.3%

-5.2%

CYA

Century Australia

Large

$

0.83 $

0.79

5.4%

-8.8%

-8.4%

-14.2%

-15.0%

MLT

Milton Corporation

Large/Medium

$

4.40 $

4.05

8.6%

2.1%

0.1%

-3.2%

-1.2%

BKI

BKI Investment

Large/Medium

$

1.62 $

1.44

12.3%

2.0%

-1.2%

-5.6%

-9.0%

CIN

Carlton Investments

Large/Medium

$

30.25 $

36.86

-17.9%

-10.7%

-11.7%

-15.6%

-14.9%

DUI

Diversified United Investments

Large/Medium

$

3.23 $

3.26

-1.0%

-5.6%

-6.3%

-8.3%

-6.1%

WHF

Whitefield

Large/Medium

$

4.18 $

4.33

-3.4%

-7.0%

-6.5%

-8.4%

-9.0%

AMH

AMCIL

Large/Medium

$

0.87 $

0.86

0.9%

-4.1%

-4.0%

-9.7%

-9.7% -15.0%

CAM

Clime Capital"

Large/Medium

$

0.78 $

0.93 ^

-15.9%

-7.1%

-6.3%

-10.9%

FSI

Flagship Investments

Large/Medium

$

1.34 $

1.86 ^

-27.8%

-14.0%

-7.7%

-6.9%

-6.1%

WAM

WAM Capital

Medium/Small

$

2.17 $

1.85

17.3%

6.6%

4.9%

0.1%

-9.2%

MIR

Mirrabooka Investments

Medium/Small

$

2.51 $

2.19

14.6%

9.3%

9.9%

3.0%

-2.9%

WIC

WestOz Investment Co.

Medium/Small

$

0.73 $

0.91 #

-19.4%

-10.2%

-10.5%

-18.3%

-21.1%

WAX

WAM Research"

Medium/Small

$

1.36 $

1.14

19.4%

5.6%

4.7%

-4.2%

-14.0%

OZG

OzGrowth

Medium/Small

$

0.11 $

0.15 #

-26.2%

-12.1%

-15.4%

-22.3%

n/a

WAA

WAM Active

Medium/Small

$

1.06 $

0.98

7.3%

1.8%

7.0%

0.7%

n/a -20.7%

CTN

Contango Microcap

Small/Micro

$

0.95 $

1.07 ^

-12.0%

-7.8%

-10.0%

-15.0%

ACQ

Acorn Capital Invst Fund"

Small/Micro

$

0.82 $

0.97 ^

-16.3%

-18.0%

n/a

n/a

n/a

ALF

Australian Leaders Fund"

Long/Short

$

1.47 $

1.36 ^

8.1%

6.9%

-2.9%

-9.0%

-13.8%

CDM

Cadence Capital"

Long/Short

$

1.42 $

1.34 ^

5.8%

0.4%

-3.3%

-13.5%

n/a

NCC

NAOS Emerging Opp"

Long/Short

$

0.93 $

1.08 ^

-13.9%

-8.6%

n/a

n/a

n/a

FGX

Future Generation Investment Company Fund of Funds

$

1.14 $

1.15 ^

-0.6%

-1.7%

n/a

n/a

n/a

WMK

Watermark Market Neutral"

Market Neutral

$

1.00 $

1.08 ^

-7.4%

-11.3%

n/a

n/a

n/a

SNC

Sandon Capital"

Activist

$

0.82 $

0.98 ^

-16.3%

-7.7%

n/a

n/a

n/a

MFF

Magellan Flagship Fund"

International

$

1.82 $

1.77 #

2.6%

2.6%

-6.1%

-9.9%

n/a

PMC

Platinum Capital

International

$

1.62 $

1.48 ^

9.7%

0.6%

-4.3%

2.5%

11.4%

TGG

Templeton Global Growth

International

$

1.11 $

1.32 ^

-15.8%

-9.8%

-8.9%

-13.7%

-15.1%

HHV

Hunter Hall Global Value

International

$

1.09 $

1.29 ^

-15.6%

-11.2%

-12.9%

-13.9%

-14.2%

PGF

PM Capital Global Opp"

International

$

0.89 $

1.02 ^

-12.8%

-12.8%

n/a

n/a

n/a

GVF

Global Value Fund

International (Multi Asset) $

1.00 $

1.15 ^

-12.9%

-10.2%

n/a

n/a

n/a

AGF

AMP Capital China Growth

Asia

$

0.78 $

1.01 ^

-23.3%

-21.9%

-20.8%

-21.8%

n/a

PAF

PM Capital Asia

Asia

$

0.87 $

1.01 ^

-13.9%

-13.1%

n/a

n/a

n/a

" The Fully Diluted Indicative NTA has been adjusted for options dilution (100% excercise) and dividends. Dividends are removed from the NTA once the security goes ex-date and until the receipt of the new ex-dividend NTA . # The Indicative NTA is the actual reported weekly pre-tax NTA as we have been unable to calculate the Indicative NTA within a reasonable level of accuracy. ^ The Indicative NTA is the actual reported weekly pre-tax NTA as we have been unable to calculate the Indicative NTA within a reasonable level of accuracy.* Average premium/discounts as at end of the previous month. +Prem/Disc does not adjust for the dilution of unexcercised options. SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

19

LIC Indicative NTA (continued) Using the Bell Potter Indicative NTA, we calculate the effective impact on the share price if the premium or discount were to normalise to the 1, 3, 5 and 10 year average. We have also calculated this figure on an annualised basis. The Indicative NTA is not without error and clearly susceptible to higher turnover, tax realisation, receipt and payment of dividends and accrued performance fees. As such, variations will occur across LICs and different market conditions. We have included the Average Error (average of the monthly NTA less Indicative NTA), Average Absolute Error (average of the monthly NTA less Indicative NTA on an absolute basis), and the range of Minimum and Maximum Errors over the previous 12-month period. Table 17: Premium/Discount Normalisation and Error Tracking (as at 9 February 2016) Investment

Share Price Impact if Premium/Discount normalises*

ASX Code Company Name

Mandate

1 year

AFI

AFIC"

Large

-5.4%

-5.0%

ARG

Argo Investments

Large

-8.3%

-11.6%

DJW

Djerriwarrh Investments

Large

-16.7%

-21.9%

AUI

Australian United Investments Large

-10.9%

-11.7%

CYA

Century Australia

Large

-14.1%

-13.8%

MLT

Milton Corporation

Large/Medium

-6.5%

-8.5%

BKI

BKI Investment

Large/Medium

-10.2%

CIN

Carlton Investments

Large/Medium

7.3%

DUI

Diversified United Investments Large/Medium

-4.6%

3 years

5 years

Share Price Impact if Premium/Discount normalises is annualised+ Avg Error

10 years

1 year

3 years

5 years

10 years

-8.1%

-7.5%

-5.4%

-1.7%

-1.7%

-0.8%

-0.5%

-14.8%

-12.5%

-8.3%

-4.0%

-3.2%

-1.3%

-0.3%

-26.5%

-33.4%

-16.7%

-7.9%

-6.0%

-4.0%

0.2%

-13.7%

-11.7%

-10.9%

-4.1%

-2.9%

-1.2%

-0.2%

-19.5%

-20.4%

-14.1%

-4.8%

-4.3%

-2.3%

-0.2%

-11.8%

-9.8%

-6.5%

-2.9%

-2.5%

-1.0%

-0.3%

-13.5%

-17.9%

-21.2%

-10.2%

-4.7%

-3.9%

-2.4%

-0.2%

6.2%

2.3%

3.0%

7.3%

2.0%

0.5%

0.3%

-0.4%

-5.3%

-7.3%

-5.1%

-4.6%

-1.8%

-1.5%

-0.5%

-0.1%

WHF

Whitefield

Large/Medium

-3.6%

-3.2%

-5.1%

-5.6%

-3.6%

-1.1%

-1.0%

-0.6%

-0.1%

AMH

AMCIL

Large/Medium

-5.0%

-4.9%

-10.6%

-10.6%

-5.0%

-1.7%

-2.2%

-1.1%

0.3%

CAM

Clime Capital"

Large/Medium

8.9%

9.7%

5.1%

0.9%

8.9%

3.1%

1.0%

0.1%

0.5%

FSI

Flagship Investments

Large/Medium

13.8%

20.1%

20.9%

21.6%

13.8%

6.3%

3.9%

2.0%

n/a

WAM

WAM Capital

Medium/Small

-10.7%

-12.4%

-17.2%

-26.5%

-10.7%

-4.3%

-3.7%

-3.0%

-1.0%

MIR

Mirrabooka Investments

Medium/Small

-5.3%

-4.7%

-11.6%

-17.5%

-5.3%

-1.6%

-2.4%

-1.9%

-0.5%

WIC

WestOz Investment Co.

Medium/Small

9.2%

8.9%

1.1%

-1.6%

9.2%

2.9%

0.2%

-0.2%

n/a

WAX

WAM Research"

Medium/Small

-13.8%

-14.7%

-23.7%

-33.5%

-13.8%

-5.2%

-5.3%

-4.0%

0.6%

OZG

OzGrowth

Medium/Small

14.1%

10.7%

3.9%

n/a

14.1%

3.5%

0.8%

n/a

n/a

WAA

WAM Active

Medium/Small

-5.5%

-0.3%

-6.6%

n/a

-5.5%

-0.1%

-1.4%

n/a

0.1%

CTN

Contango Microcap

Small/Micro

4.3%

2.0%

-3.0%

-8.7%

4.3%

0.7%

-0.6%

-0.9%

-1.6%

ACQ

Acorn Capital Invst Fund"

Small/Micro

-1.8%

n/a

n/a

n/a

-1.8%

n/a

n/a

n/a

n/a

ALF

Australian Leaders Fund"

Long/Short

-1.2%

-11.0%

-17.1%

-21.9%

-1.2%

-3.8%

-3.7%

-2.4%

n/a

CDM

Cadence Capital"

Long/Short

-5.4%

-9.1%

-19.3%

n/a

-5.4%

-3.1%

-4.2%

n/a

n/a

NCC

NAOS Emerging Opp"

Medium/Small

5.2%

n/a

n/a

n/a

5.2%

n/a

n/a

n/a

n/a

FGX

Future Generation Invst Comp Fund of Funds

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

n/a

WMK

Watermark Market Neutral"

-3.9%

n/a

n/a

n/a

-3.9%

n/a

n/a

n/a

n/a

Market Neutral

SNC

Sandon Capital"

Activist

8.5%

n/a

n/a

n/a

8.5%

n/a

n/a

n/a

n/a

MFF

Magellan Flagship Fund"

International

0.0%

-8.7%

-12.5%

n/a

0.0%

-3.0%

-2.6%

n/a

n/a

PMC

Platinum Capital

International

-9.1%

-14.0%

-7.2%

1.7%

-9.1%

-4.9%

-1.5%

0.2%

n/a

TGG

Templeton Global Growth

International

6.1%

7.0%

2.2%

0.8%

6.1%

2.3%

0.4%

0.1%

n/a

HHV

Hunter Hall Global Value

International

4.4%

2.7%

1.7%

1.4%

4.4%

0.9%

0.3%

0.1%

n/a

PGF

PM Capital Global Opp"

International

0.0%

n/a

n/a

n/a

0.0%

n/a

n/a

n/a

n/a

GVF

Global Value Fund

Intl (Multi Asset)

2.7%

n/a

n/a

n/a

2.7%

n/a

n/a

n/a

n/a

AGF

AMP Capital China Growth

Asia

1.4%

2.5%

1.4%

n/a

1.4%

0.8%

0.3%

n/a

n/a

PAF

PM Capital Asia

Asia

0.8%

n/a

n/a

n/a

0.8%

n/a

n/a

n/a

n/a

* Refers to the current share price divided by the indicative pre-tax NTA as compared to the average 1, 3, 5 and 10 year Discount/Premium share price to pre-tax NTA as at end of the previous month, over the relevant time period of 1, 3, 5 and 10 years. * Refers to the current share price divided by the indicative pre-tax NTA as compared to the average 1, 3, 5 and 10 year Discount/Premium share price to pre-tax NTA as at end of the previous month, annualised over the relevant time period of 1, 3, 5 and 10 years.

SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

20

LIC Indicative NTA (continued) A number of LICs under our coverage currently have options outstanding. Options dilute the NTA when exercised and therefore have an impact on the premium or discount. Table 18: Dilution Effect of Outstanding Options on Indicative NTA (as at 9 February 2016) Share Indicative ASX CodeCompany Name

Code

SOI

Options

Strike

AFI

AFIC"

AFIG

1,125,166,196

1,940,169

5.09 $

ARG

Argo Investments

n/a

676,959,075

n/a

n/a $

DJW

Djerriwarrh Investments

n/a

218,589,718

n/a

AUI

Australian United Investments n/a

109,532,911

n/a

$

Price

NTA after % Excercised

Option Expiry

NTA^

Price

5.46 $

5.12

$ 110.50

7.58 $

6.66

n/a

n/a

n/a $

4.06 $

2.76

n/a

n/a

n/a $

7.22 $

6.78

n/a

28-Feb-17 $

CYA

Century Australia

n/a

81,865,704

n/a

n/a $

0.83 $

0.79

n/a

n/a

Milton Corporation

n/a

649,001,426

n/a

n/a $

4.40 $

4.05

n/a

n/a

BKI

BKI Investment

n/a

568,700,054

n/a

n/a $

Carlton Investments

n/a

26,474,675

n/a

n/a $

DUI

Diversified United Investments n/a

206,928,779

n/a

n/a $

1.62 $

1.48

n/a

n/a

$

36.86

n/a

n/a

3.23 $

3.26

n/a

n/a

30.25

WHF

Whitefield

n/a

80,208,773

n/a

n/a $

4.18 $

4.33

n/a

n/a

AMH

AMCIL

n/a

246,006,664

n/a

n/a $

0.87 $

0.86

n/a

n/a

CAM

Clime Capital"

n/a

80,751,049

n/a

n/a $

0.78 $

0.94

n/a

FSI

Flagship Investments

n/a

25,338,038

n/a

n/a $

1.34 $

1.86

n/a

n/a

WAM

WAM Capital

n/a

468,006,885

n/a

n/a $

2.17 $

1.85

n/a

n/a

MIR

Mirrabooka Investments

n/a

154,744,788

n/a

WIC

WestOz Investment Co.

WICOA

129,251,548

12,904,671

WAX

WAM Research"

n/a

172,768,120

OZG

OzGrowth

OZGOA

361,000,816

WAA

WAM Active

n/a

CTN

Contango Microcap

CTNG

ACQ

Acorn Capital Invst Fund" n/a

n/a $

2.51 $

2.19

1.05 $

0.73 $

0.91

n/a

n/a $

1.36 $

1.14

36,054,213

$ 0.180 $

0.11 $

0.15

34,909,728

n/a

161,151,241

265,000

49,889,707

n/a

$

$

n/a $

0.001 n/a

$

0.005

n/a $

1.06 $

0.98

n/a

1.30 $

0.95 $

1.07

$ 100.000

n/a $

0.82 $

0.97

n/a

31-Aug-16 $

268,524,479

n/a

$

1.37 $

1.47 $

1.36

n/a

n/a

268,383,269

n/a

$

1.43 $

1.42 $

1.34

n/a

n/a

n/a

n/a $

0.93 $

1.08

$

1.10 $

1.14 $

1.19

n/a $

1.00 $

1.08

WMK

Watermark Market Neutral"n/a

SNC

Sandon Capital"

MFF

Magellan Flagship Fund" MFFO

n/a

46,918,297

n/a 176,272,603

87,610,397

n/a

44,260,206

n/a

464,160,512

78,010,297

n/a $

0.82 $

0.98

$

1.00 $

1.82 $

1.90

n/a $

0.039 n/a n/a

$

0.820

Platinum Capital

n/a

234,571,212

n/a

n/a $

1.62 $

1.48

n/a

n/a

249,660,311

n/a

$

1.00 $

1.11 $

1.32

n/a

n/a

$

1.00 $

1.09 $

1.29

n/a

n/a

n/a $

0.89 $

1.02

n/a

n/a

1.00 $

1.00 $

1.15

n/a $

0.78 $

1.01

1.00 $

0.87 $

1.01

Hunter Hall Global Value n/a

242,433,553

n/a

n/a

347,344,401

n/a

GVF

Global Value Fund

GVFO

AGF

AMP Capital China Growthn/a

PAF

PM Capital Asia

PAFO

73,062,491

50,623,734

386,294,100

n/a

55,087,501

55,087,500

$

$

$

0.002 n/a

$

0.001

6.7%

0.906

$

0.906

$

0.906

-19.4%

-19.4%

-19.4%

0.149

$

0.149

$

0.149

-26.2%

-26.2%

-26.2%

1.07 $

1.07 $

1.07

-12.0%

-12.0%

-12.0%

1.15 $

1.15 $

1.16

-0.6%#

-1.3%#

-1.9%#

1.77 $

1.80 $

1.83

2.6%#

0.6%#

-0.8%#

1.15 $

1.15 $

1.15

-12.9%

-12.9%

-12.9%

1.01 $

1.01 $

1.01

-13.9%

-13.9%

-13.9%

n/a 31-Oct-17 $

Templeton Global Growth n/a

PM Capital Global Opp"

6.7%

n/a

PMC

HHV

6.7%

n/a 16-Sep-16 $

TGG

PGF

5.12

n/a

n/a

189,435,053

50%

n/a 31-Mar-20 $

Australian Leaders Fund" n/a

Future Generation Invst Comp FGXO

70%

n/a

Cadence Capital" NAOS Emerging Opp"

5.12 $

100%

n/a 31-Aug-16 $

ALF

NCC

5.12 $

Eff. Prem/Disc after % Exc. 50%

n/a

CDM

FGX

70%

n/a

MLT

CIN

100%

17-Mar-16 $ n/a 31-May-16 $

^ The Indicative NTA has been adjusted for dividends once the security goes ex-date and until the receipt of the new ex-dividend NTA . # The Indicative NTA is the actual reported weekly or monthly pre-tax NTA as we have been unable to calculate the Indicative NTA within a reasonable level of accuracy. * Average premium/discounts as at end of the previous month.

SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

21

Liquidity Liquidity is an important characteristic to consider when making an investment. Liquidity is the ability to buy or sell a particular security . Unfortunately, the volume traded among some LICs can be quite thin at times and may be difficult to trade larger lines Therefore, liquidity needs to be taken into consideration when investing in this asset class. In the table below, we have a look at the 3 year Weekly and Monthly Averages for the LICs in our coverage. Table 19: Liquidity Investment ASX Code

Company Nam e

Mandate

3 yr Average

3 yr Average

3 yr Average

3 yr Average

On Issue

Shares Options

Weekly Volume

Weekly Value

Monthly Volume

Monthly Value

1,940,169

Dom estic Equities AFI

AFIC"

Large

1,097,326,895

1,645,218

9,720,557

7,129,278

42,122,413

ARG

Argo Investments

Large

676,959,075

-

862,059

6,346,067

3,735,589

27,499,622

DJW

Djerriw arrh Investments

Large

218,589,718

-

512,434

2,301,063

2,220,546

9,971,273

AUI

Australian United Investments

Large

109,532,911

-

62,904

485,665

272,584

2,104,547

CYA

Century Australia

Large

81,865,704

-

312,746

265,972

1,355,232

1,152,546

MLT

Milton Corporation

Large/Medium

649,001,426

-

745,613

3,168,004

3,230,988

13,728,015

BKI

BKI Investment

Large/Medium

568,700,054

-

1,057,661

1,681,360

4,583,198

7,285,892

CIN

Carlton Investments

Large/Medium

26,474,675

-

10,582

281,697

45,857

1,220,686

DUI

Diversified United Investments Large/Medium

206,928,779

-

209,384

702,292

907,333

3,043,263

WHF

Whitefield

Large/Medium

80,208,773

-

132,141

534,308

572,609

2,315,335

AMH

AMCIL

Large/Medium

246,006,664

-

331,187

289,601

1,435,145

1,254,936

QVE

QV Equities

Large/Medium

202,962,892

902,374 *

928,189 *

3,910,289 *

4,022,151 *

CAM

Clime Capital

Large/Medium

80,751,049

-

292,358

283,894

1,266,883

1,230,208

FSI

Flagship Investments

Large/Medium

25,338,038

-

60,112

86,162

260,487

373,370

CBC

CBG Capital

Large/Medium

24,313,698

68,402 *

65,957 *

296,409 *

285,813 *

WAM

WAM Capital

Medium/Small

468,006,885

-

2,164,307

4,099,642

9,378,662

17,765,115

MIR

Mirrabooka Investments

Medium/Small

154,744,788

-

260,532

647,233

1,128,973

2,804,678

WIC

WestOz Investment Co.

Medium/Small

129,251,548

456,956

510,102

1,980,142

2,210,443

WAX

WAM Research

Medium/Small

172,768,120

587,321

676,980

2,545,056

2,933,582

OZG

OzGrow th

Medium/Small

CTN

Contango Microcap

Small/Micro

161,151,241

ACQ

Acorn Capital

Small/Micro

49,889,707 *

BTI

Bailador Tech Investments

Unlisted Tech

58,336,510 *

ALF

Australian Leaders Fund

Long/Short

268,524,479

-

1,743,875

2,663,051

7,556,790

11,539,889 8,089,267

361,000,816

166,278,909

24,214,499

12,904,671 36,054,213 265,000 58,336,509

1,065,739 1,027,102

194,273 1,075,864

4,618,201

841,852

4,450,774

4,662,079 1,196,928 *

345,420 *

276,214 *

1,496,819 *

158,228 *

143,737 *

685,655 *

622,862 *

CDM

Cadence Capital

Long/Short

268,383,269

-

1,299,733

1,866,754

5,632,175

WAA

WAM Active

Long/Short

34,909,728

-

254,808

296,620

1,104,168

NCC

Naos Emerging Opportunities

Long/Short

46,918,297 *

-

223,521 *

230,935 *

968,592 *

1,000,718 *

WMK

Watermark Market Neutral

Market Neutral

87,610,397 *

-

546,224 *

522,122 *

2,366,969 *

2,262,530 *

1,285,352

International Equities MFF

Magellan Flagship Fund

International

464,156,179

1,974,061

2,933,849

8,554,265

12,713,344

PMC

Platinum Capital

International

234,571,212

-

1,281,861

2,175,797

5,554,732

9,428,452

TGG

Templeton Global Grow th

International

249,660,311

-

1,173,656

1,414,308

5,085,843

6,128,669

HHV

Hunter Hall Global Value

International

242,433,553

-

1,299,160

1,397,803

5,629,695

6,057,146

PGF

PM Capital Global Opp

International

347,344,401 *

-

1,913,066 *

1,955,479 *

8,289,951 *

8,473,740 *

GVF

Global Value Fund

International

ALI

Argo Global Infrastructure

Intl Infra

PAF

PM Capital Asian Opp

Asia

55,087,501 *

AGF

AMP Capital China Grow th

China

386,294,100

-

3,272,208

3,577,520

103,070,369

-

1,835,782

248,373

7,955,053

1,076,282

29,886,828

-

298,323

306,756

1,292,734

1,329,275

72,961,491 *

78,014,630

50,724,734

329,931 *

340,974 *

1,429,702 *

1,477,556 *

143,082,314 * 143,044,214

602,671 *

1,149,949 *

2,611,574 *

4,983,112 *

310,144 *

295,071 *

1,343,956 *

1,278,643 *

14,179,568

15,502,586

55,087,500

Specialist HHY

Hastings High Yield

Fixed income

ABW

Aurora Absolute

Income

FGX

Future Gen Investment Comp

Fund of Funds

184,253,715

181,217,876

1,017,792 *

1,109,106 *

4,410,433 *

4,806,125 *

FGG

Future Gen Global Invest

Gbl Fnd of Fnd

275,179,167

274,165,166

1,125,044 *

1,247,921 *

4,875,190 *

5,407,658 *

SNC

Sandon Capital

Activist

156,917 *

145,543 *

679,975 *

630,688 *

44,260,206

-

* History less than 3 years SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

22

Indirect Cost Ratio: Fees and Expenses In the Graphs below, we have provided the Indirect Cost Ratio (ICR) for LICs in our coverage for the full year ending 30 June 2015. The ICR has been calculated both with and without performance fees. We are using this method of calculation to standardise the cost ratios across our LIC universe given the many different interpretations of the Management Expense Ratio, which is a frequently used expense calculation. ICR is generally accepted as the principal expense ratio calculation for the Managed Funds industry. Note, a number of LICs have been on the market for less than a year, therefore ICR is non-applicable. Graph 13: Indirect Cost Ratio 6% Lrg Cap mandate

Lrg/Med Cap mandate

Med/Sml Cap mandate

Long/Short/ Neutral

Specialist

International

5%

3%

2%

N/A

0%

N/A

N/A

1%

AFI ARG DJW AUI CYA MLT BKI CIN DUI WHF AMH QVE CAM FSI CBC WAM MIR WIC WAX OZG CTN ACQ BTI ALF CDM WAA NCC WMK MFF PMC TGG HHV PGF GVF ALI PAF AGF HHY ABW FGX FGG SNC

ICR

4%

ICR - with performance fee

ICR - w/out performance fee SOURCE: COMPANY DATA, IRESS & BELL POTTER

LISTED INVESTMENT COMPANIES.

23

AUSTRALIAN FOUNDATION INVESTMENT CO (AFI) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Internal

Indirect cost ratio w it h p er f .

S&P/ASX 200 Accumulation

Listed:

1936

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

0.16%

Share price

$5.95

0.16%

Pre-tax NTA

$5.63

Post-tax NTA

$4.87

Investment Strategy AFI takes a medium to longer term view of value w hich means that the aim is to buy and hold individual stocks for the long term based on selection criteria w hich, in summary, include: formulation and execution of the business strategy and its underlying business value; key financial indicators, including cash flow , prospective price earnings relative to projected grow th, sustainability of earnings and dividend yield; and corporate governance practices.

Premium/(Discount) share price to: Pre-tax NTA

5.7%

Post-tax NTA

22.2%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel: Ross Barker (MD) and Mark Freeman (CIO). Directors: Terrence Campbell (Chairman), Ross Barker, Jacqueline Hey, John Paterson, David Peever, Catherine Walter, Peter Williams and Graeme Liebelt.

Yield

3.9%

Franking

100%

Grossed up yield

5.5%

$0.23

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Small Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: Options used to generate additional income in its short-term trading portfolio.

Options/other

Cash/Debt: $164m cash, $202m debt/hybrid (30 Jun 2015)

Fully diluted

1099.4m

Dividend reinvestment plan: Yes, 2.5% discount to 5 day average price post ex-date

Market capitalisation

6529.1m

1097.3m 2.0m

Other: Affiliated w ith AMCIL (AMH), Djerriw arrh (DJW) and Mirrabooka (MIR).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

4.4%

-0.5%

2.1%

9.7%

8.2%

7.6%

Share price* Performance Index

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-2.2%

-0.9%

-1.7%

0.4%

1.7%

1.9%

Performance

6.0%

-1.3%

1.0%

8.7%

7.3%

6.5%

Benchmark

6.5%

-0.5%

2.6%

9.2%

7.0%

5.6%

-0.5%

-0.8%

-1.6%

-0.5%

0.3%

0.9%

Active return NTA+

Active return

AFI share price v ASX All Ords $7.50

6,000

$7.00

5,600

$6.50

5,200

$6.00

4,800

$5.50

4,400

$5.00 Jan-15

May-15 AFI

Share Price and NTA $7.00

40% Prem/Disc (RHS)

$6.50

Pre- Tax NTA (LHS)

Share Price (LHS)

30%

$6.00

Aug-15

4,000 Dec-15

ALL OR DINAR IE S

Top 20 Holdings

%

as at 31-Dec-15 Commonw ealth Bank

11.3

20%

Westpac Bank

9.0

$5.00

10%

National Australia Bank

4.8

$4.50

0%

$4.00

Wesfarmers

4.7

-10%

Telstra

4.7

BHP Billiton

4.0

ANZ Bank

3.8

$5.50

$3.50

-20%

$3.00 $2.50

-30%

$2.00 2006

-40% 2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Exposure (Top 20)

Inform ation Share price*

2013

Sharpe

Transurban Group

3.1

CSL

2.7

Amcor

2.6

Standard

Rio Tinto

2.6

Deviation

Brambles

2.3 2.0

Ratio

Ratio

Year 1

-0.22

-0.06

9.6%

Woolw orths

Year 3

0.06

0.73

8.8%

AMP

1.9

Year 5

0.21

0.39

11.4%

Oil Search

1.8

Year 1

-1.26

-0.12

14.5%

Year 3

-0.47

0.43

12.5%

Woodside Petroleum

1.6

Year 5

0.28

0.30

12.0%

Ramsay Health Care

1.5

Industrial

Financials

NTA+ Resources

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ASX 200 Accumulat ion.

QBE Insurance Group

1.8

AGL Energy

1.8

Incitec Pivot

1.4

% of Total

69.4

*+ M easurement of a LIC’s performance is calculated after all operat ing expenses, provision and payment of both income and capital gains tax and the reinvestment of dividends, and do not incorporate franking. Index returns however are ent irely bef ore any operat ing expenses or taxation. LIC returns will consequent ly be understated relat ive to the Index return.

LISTED INVESTMENT COMPANIES.

24

ARGO INVESTMENTS (ARG) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Internal

Indirect cost ratio

wi t h p er f . f ee:

S&P/ASX 200 Accumulation 0.15%

Share price

$8.00

Listed:

1946

Indirect cost ratio

w/ o ut p er f . f ee:

0.15%

Pre-tax NTA

$7.28

Post-tax NTA

$6.47

as at 31-Dec-15

Investment Strategy ARG's objective is to maximise long-term returns to shareholders through a balance of capital and dividend grow th. The Group seeks to invest in quality companies that display sound management and a capability to grow profitability to fund increasing dividend payments. ARG is a value orientated, bottom-up stock picker w hose objective is to buy on price w eakness and hold for the long-term. ARG characterises itself as moderately benchmark aw are, value driven and fundamentally based.

Premium/(Discount) share price to: Pre-tax NTA

9.9%

Post-tax NTA

23.6%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel: Jason Beddow (MD), Andy Forster (SIO), Brydie Lloyd-Roberts, Paul Frost, Daniel Cuthbertson and Colin Whitehead. Directors: Ian Martin AM (Chairman), Russell Higgins AO, Anne Brennan, Jason Beddow , Robert Patterson, Joycelyn Morton and Roger Davis.

Yield

3.7%

Franking

100%

Grossed up yield

5.3%

$0.295

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Small Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: Options used to generate additional income in its short-term trading portfolio.

Options/other

Cash/Debt: $98.6m cash (31 Dec '15), $0m Debt (30 June '15)

Fully diluted

Dividend reinvestment plan: Yes, 2% discount to 4 day VWAP post ex-date

Market capitalisation

677.0m 0.0m 677.0m 5415.7m

Other: n/a

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

5.4%

2.4%

7.0%

13.3%

9.2%

6.4%

Index

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-1.2%

2.0%

3.2%

4.0%

2.7%

0.7%

Share price*

Active return

ARG share price v ASX All Ords $9.00

6,000

$8.25

5,500

$7.50

5,000

$6.75

4,500

NTA+ Performance

5.7%

-1.1%

2.8%

9.3%

7.3%

5.6%

Benchmark

6.5%

-0.5%

2.6%

9.2%

7.0%

5.6%

-0.8%

-0.6%

0.2%

0.1%

0.3%

0.0%

Active return

$6.00 Jan-15

May-15 AR G

Share Price and NTA $9.00

Prem/Disc (RHS)

Pre-Tax NTA (LHS)

40%

Share Price (LHS)

30%

$7.00 $6.00 $5.00

2009

2010

2011

2012

Risk/Return Indicators

2013

2014

7.5 5.5

10%

ANZ Bank

5.5

0%

Telstra

4.9

-10%

Wesfarmers

4.6

Macquarie Group

3.9

National Australia Bank

3.7

BHP Billiton

3.1

-40% 2008

%

20%

-30% 2007

as at 31-Dec-15 Westpac Bank Commonw ealth Bank

-20% $4.00

4,000 Dec-15

AL L OR DIN AR IE S

Top 20 Holdings

$8.00

$3.00 2006

Aug-15

2015

Exposure (Top 20)

Milton Corp

2.8

Australian United Investment

2.6

Sharpe

Standard

Rio Tinto

2.3

Ratio

Ratio

Deviation

CSL

2.2

Year 1

0.35

0.46

9.3%

Woolw orths

2.0

Year 3

0.47

1.07

9.3%

Ramsay Health Care

1.9

Year 5

0.36

0.53

10.6%

Inform ation Share price*

Industrial Financials

NTA+

Sydney Airport

1.9

APA Group

1.8

Year 1

0.17

0.01

13.5%

AMP

1.5

Year 3

0.04

0.51

11.5%

Amcor

1.3

Year 5

0.17

0.32

11.2%

Resources

* The share price benchmark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ASX 200 Accumulation Index.

AGL Energy

1.3

Brambles

1.3

% of Total

61.6

*+ M easurement of a LIC’s performance is calculated aft er all operating expenses, provision and payment of both income and capital gains tax and the reinvestment of dividends, and do not incorporate f ranking. Index ret urns ,however, are entirely before any operat ing expenses or t axation. LIC returns will consequently be underst ated relative t o t he Index return.

LISTED INVESTMENT COMPANIES.

25

DJERRIWARRH INVESTMENTS (DJW) Domestic Focussed

Share Price and NTA Summary

Mandate: Australian listed equities

Benchm ark:

Manager: Internal

Indirect cost ratio

wit h p er f . f ee:

0.45%

Share price

$4.30

Indirect cost ratio

w/ o ut p er f . f ee:

0.45%

Pre-tax NTA

$3.21

Post-tax NTA

$3.27

Listed:

1995

S&P/ASX 200 Accumulation

as at 31-Dec-15

Investment Strategy DJW invests in Australian equities w ith a focus on stocks w here there is an active options market and/or sustainable dividend yield. The company aims to provide shareholders w ith attractive investment returns through an enhanced level of dividends and attractive total returns over the medium to long term. It takes a medium to longer term view of value w hich means that the aim is to buy and hold individual stocks for the long term based on selection criteria w hich, in summary, include: formulation and execution of the business strategy and its underlying business value; and key financial indicators, including prospective price earnings relative to projected grow th, sustainability of earnings and dividend yield (including franking) and balance sheet position including gearing, interest cover and cash flow .

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment personnel: Ross Barker (MD) and Mark Freeman (CIO). Directors: John Paterson (Chariman), Ross Barker, Graham Kraehe, Andrew Guy, Alice Williams, Graham Goldsmith, Kathryn Fagg, and Robert Edgar.

Yield

6.0%

Franking

100%

Grossed up yield

8.6%

Pre-tax NTA

34.0%

Post-tax NTA

31.5%

Historic Dividend (prior 12-mths) $0.26

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Small Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: Options typically w ritten on betw een 20-50% of the Portfolio.

Options/other

Cash/Debt: $0.6m cash, $86.5m debt (31 Dec 2015)

Fully diluted

218.6m

Dividend reinvestment plan: Suspended

Market capitalisation

939.9m

218.6m 0.0m

Other: Affiliated w ith AMCIL (AMH), AFIC (AFI) and Mirrabooka (MIR).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

4.6%

-5.0%

-1.2%

7.8%

6.8%

6.7%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-2.0%

-5.4%

-5.0%

-1.5%

0.3%

1.0%

4.9%

-4.2%

-2.6%

5.0%

4.7%

4.6%

6.5%

-0.5%

2.6%

9.2%

7.0%

5.6%

-1.6%

-3.7%

-5.2%

-4.2%

-2.3%

-1.0%

Share price*

Active return

DJW share price v ASX All Ords $6.00

6,000

$5.50

5,500

$5.00

5,000

$4.50

4,500

NTA+ Performance Benchmark Active return

$4.00 Jan-15

May-15 D JW

Aug-15

4,000 Dec-15

AL L OR DIN AR IE S

Share Price and NTA

Top 20 Holdings

$6.00

as at 31-Dec-15 Commonw ealth Bank

9.1

20%

Westpac Bank

7.7

10%

National Australia Bank

6.8

0%

ANZ Bank

5.9

-10%

Telstra Corporation

5.1

-20%

BHP Billiton

5.1

Pr em/Disc (RHS)

Pr e- Tax NTA (LHS)

40%

Share Price (LHS)

30% $5.00 $4.00 $3.00 $2.00

-30% $1.00 2006

-40% 2007

2008

2009

2010

2011

Risk/Return Indicators Inform ation

2012

2013

2014

2015

Exposure (Top 20)

%

CSL

3.7

Oil Search

3.3

Wesfarmers

3.0

Brambles

2.5

Sharpe

Standard

Rio Tinto

2.3 2.3

Share price*

Ratio

Ratio

Deviation

Woodside Petroleum

Year 1

-0.42

-0.35

11.2%

QBE Insurance Group

1.8

Year 3

-0.14

0.42

10.5%

AMP

1.7

Year 5

0.02

0.22

14.3%

Industrials Financials Resources

NTA+

Woolw orths

1.6

Suncorp Group

1.5

Year 1

-1.79

-0.38

13.9%

Mirrabooka Investments

1.5

Year 3

-1.71

0.14

11.9%

Incitec Pivot

1.4

Year 5

-0.76

0.09

11.9%

Seek

1.4

Qube Holdings

1.3

* The shareprice benchmark has been compared against t he S&P/ ASX A ll Ordinaries Accumulation Index. + The NTA has been compared against the S&P/A SX 200 A ccumulation.

% of Total

*+ M easurement of a LIC’s performance is calculated af ter all operating expenses, provision and payment of bot h income and capit al gains tax and the reinvest ment of dividends, and do not incorporate franking. Index ret urns however are ent irely bef ore any operating expenses or t axat ion. LIC ret urns will consequent ly be understated relat ive to t he Index return.

69.1

LISTED INVESTMENT COMPANIES.

26

AUSTRALIAN UNITED INVESTMENT CO (AUI) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Internal

Indirect cost ratio

wit h p er f . f ee:

S&P/ASX 300 Accumulation 0.10%

Share price

$7.40

Listed:

1953

Indirect cost ratio

w/ o ut p er f . f ee:

0.10%

Pre-tax NTA

$7.83

Post-tax NTA

$6.93

as at 31-Dec-15

Investment Strategy AUI is an investment company w hich seeks, through careful portfolio management, to reduce risk and improve income from dividends and interest so as to maintain and grow dividend distributions to shareholders over the long term. AUI w as founded in 1953 by the late Sir Ian Potter and The Ian Potter Foundation Ltd is today the Company's largest single shareholder.

Premium/(Discount) share price to: Pre-tax NTA

-5.5%

Post-tax NTA

6.8%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel/Directors: Charles Goode AC (Chairman), Peter Wetherall, Frederick Grimw ade and Jim Craig.

Yield

4.6%

Franking

100%

Grossed up yield

6.6%

$0.34

Key Information Capital Structure

Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short Derivatives: n/a

Ordinary shares

Cash/Debt: $9.9m cash, $119.0m Debt (30 Jun. '15)

Fully diluted

109.5m

Dividend reinvestment plan: 5 day average price from ex-date.

Market capitalisation

810.5m

109.5m

Options/other

0.0m

Other: AUIN not entitled for next dividend

Performance

3-m th

6-mth

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

1.0%

-6.0%

-1.9%

8.9%

6.6%

5.6%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-5.6%

-6.4%

-5.7%

-0.4%

0.1%

-0.1%

6.3%

-3.1%

-2.2%

7.7%

5.6%

5.1%

6.5%

-0.4%

2.8%

9.0%

6.7%

5.5%

-0.2%

-2.7%

-5.0%

-1.3%

-1.1%

-0.4%

Share price*

Active return NTA+ Performance Benchmark Active return

AUI share price v ASX All Ords $ 12 .0 0

6 ,0 00

$ 10 .0 0

5 ,0 00

$ 8.00

4 ,0 00

$ 6.00 Ja n-1 5

Ma y-1 5

AU I

Share Price and NTA $11.00

Prem/Disc (RHS)

Pr e-Tax NTA (LHS)

40%

Share Price (LHS)

Au g-1 5

3 ,0 00 D ec-1 5

AL L OR DIN AR IE S

Top 20 Holdings

%

as at 31-Dec-15 Commonw ealth Bank

9.3

Westpac Bank

7.7

$10.00

30%

$9.00

20%

$8.00

10%

ANZ Bank

7.3

$7.00

0%

National Australia Bank

6.3

$6.00

-10%

$5.00

-20%

Wesfarmers

5.4

$4.00

-30%

Diversified United Investment

$3.00

-40%

Transurban Group

4.1

Rio Tinto

3.9

BHP Billiton

3.9

2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2013

2014

2015

Exposure (Top 20)

4.5

CSL

3.4 3.3 2.7

Sharpe

Standard

Woodside Petroleum

Ratio

Ratio

Deviation

Woolw orths

Year 1

-0.72

-0.40

11.5%

Brambles

2.2

Year 3

-0.04

0.42

13.3%

Event Hospitality & Ent

2.2

Year 5

0.01

0.21

13.8%

Ramsay Health Care

1.7

Sonic Healthcare

1.6

-1.56

-0.30

16.1%

Washington H Soul Pattinson

1.6 1.6 1.5

Inform ation Share price*

Industrial Financials

NTA+ Year 1

Resources

Year 3

-0.43

0.32

13.8%

Telstra

Year 5

-0.40

0.14

13.5%

BT Investment Management Orica

* The shareprice benchmark has been compared against t he S&P/ ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ASX 300 Accumulation Index.

% of Total

*+ M easurement of a LIC’s performance is calculat ed after all operating expenses, provision and payment of both income and capit al gains tax and the reinvestment of dividends, and do not incorporate f ranking. Index returns however are entirely before any operat ing expenses or taxation. LIC ret urns will consequent ly be understated relative to the Index return.

1.4 75.6

LISTED INVESTMENT COMPANIES.

27

CENTURY AUSTRALIA INVESTMENTS (CYA) Domestic Focussed Mandate:

Share Price and NTA Summary

Australian listed equities

Benchm ark:

S&P/ASX 300 Ac c umulation

Manager:

Perennial Value Management

Indirect cost ratio wit h p erf .

Listed:

2004

Indirect cost ratio w/ o ut

f ee:

p erf . f ee:

as at 31-Dec-15

1.15%

Share price

$0.83

0.97%

Pre-tax NTA

$0.90

Post-tax NTA

$0.93

Investment Strategy CYA aims to provide long-term capital grow th and income by investing in quality, undervalued Australian companies. Companies must display financial strength, proven management and an established and sustainable business model based on a strong 'bottom-up' approach.

Premium/(Discount) share price to: Pre-tax NTA

-8.0%

Post-tax NTA

-11.4%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel: Perennial Value Management. Directors: Robert Turner (Chairman), Stephen Menzies, Geoff Wilson and Ross Finley.

Yield

3.9%

Franking

100%

Grossed up yield

5.6%

$0.0325

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Small Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: Yes.

Options/other

Cash/Debt: $2.13m cash (31 Dec. '15), $0 debt (30 Jun. '15)

Fully diluted

81.9m

Dividend reinvestment plan: No

Market capitalisation

67.5m

81.9m 0.0m

Other: No.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

4.4%

-1.9%

-2.6%

9.7%

5.2%

4.1%

Share price* Performance Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-2.2%

-2.3%

-6.4%

0.4%

-1.3%

-1.6%

Performance

6.5%

-3.1%

1.2%

7.5%

3.8%

3.2%

Benchmark

6.5%

-0.4%

2.8%

9.0%

6.7%

5.5%

Active return

0.0%

-2.7%

-1.6%

-1.5%

-2.9%

-2.3%

Active return NTA+

CYA share price v ASX All Ords $1.20

6,000

$1.00

5,000

$0.80

4,000

$0.60 Jan-15

May-15 C YA

Returns have been calculat ed on the share price on an accumulation basis

Share Price and NTA $2.00 Pre-Tax NTA (LHS)

Share Pr ice (LHS)

$1.50

$1.00

$0.50

%

30%

10.0

20%

Westpac Bank

9.3

10%

National Australia Bank

7.4

0%

ANZ Bank

6.7

-10%

Telstra

6.1

BHP Billiton

4.6

Wesfarmers

4.1

Woolw orths

3.2

AGL Energy

2.6

Macquarie Group

2.5

-30% -40% 2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Exposure (Top 10)

Inform ation

Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

-0.80

-0.44

12.1%

Year 3

0.06

0.57

11.2%

Year 5

-0.14

0.11

13.9%

Share price*

2013

NTA+ Year 1

-0.41

-0.09

Year 3

-0.42

0.33

12.8%

Year 5

-0.44

0.01

13.3%

ALL OR DIN ARIE S

Top 10 Holdings

-20%

$0.00

3,000 Dec-15

as at 31-Dec-15 Commonw ealth Bank

40% Prem/Disc (RHS)

Aug-15

% of Total

56.5

Industrial

Resources

Financials

16.3%

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against t he S&P/ ASX 300 Accumulation. M easurements of a list ed investment company’s perf ormance based on pre-t ax asset backing or share price represent aft er tax measures, and are af ter the payment of company tax on capit al gains and unfranked income. Index returns however are entirely before t ax measures. Listed invest ment company ret urns will consequent ly be understated relat ive t o the Index return.

LISTED INVESTMENT COMPANIES.

28

MILTON CORPORATION (MLT) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Internal

Indirect cost ratio

wit h p er f . f ee:

0.12%

Share price

$4.58

Listed:

1958

Indirect cost ratio

w/ o ut p er f . f ee:

0.12%

Pre-tax NTA

$4.50

Post-tax NTA

$3.98

All Ordinaries Accumulation

as at 31-Dec-15

Investment Strategy MLT is a long-term investor in companies, trusts, stapled securities and property. MLT seeks to invest in w ell-managed companies and trusts w ith a profitable history and w ith the expectation of sound dividend grow th. MLT is not a speculative investor and does not sell its assets to increase profit for distribution to shareholders. Capital profits are reinvested by the Company for the benefit of shareholders.

Premium/(Discount) share price to: Pre-tax NTA

1.8%

Post-tax NTA

15.1%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel: Frank Gooch (MD), Sharon Johnson, Michael Borg and Michelle Wigglesw orth. Investment Commitee: Rob Millner, Kevin Eley, John Church and Frank Gooch. Directors: Robert Millner (Chairman), Kevin Eley, Ian Pollard, Frank Gooch, John Church and Graeme Crampton

Yield

4.1%

Franking

100%

Grossed up yield

5.9%

$0.188

Key Information

*included a 0.4 cent special dividend

Exposure: International/Domestic,
Equities/Fixed Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: n/a

Options/other

Cash/Debt: $140.9m Cash (31 Dec '15)

Fully diluted

Dividend reinvestment plan: Yes, 5 day VWAP post record date

Market capitalisation

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

7.3%

4.1%

6.5%

13.6%

11.7%

6.3%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

0.7%

3.7%

2.7%

4.3%

5.2%

0.6%

Performance

9.8%

5.0%

9.5%

11.4%

9.5%

6.5%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

3.2%

4.6%

5.7%

2.1%

3.0%

0.8%

Share price*

649.0m 0.0m 649.0m 2972.4m

MLT share price v ASX All Ords $7.00

7,000

$6.00

6,000

$5.00

5,000

$4.00

4,000

NTA+ $3.00 Jan-15

May-15

Aug-15

M LT

Share Price and NTA

Top 20 Holdings

$6.00

as at 31-Dec-15 Westpac Bank

40% Prem/Disc (RHS)

Pr e-Tax NTA (LHS)

Share Price (LHS)

30%

$5.00

3,000 Dec-15

ALL
OR DI NAR IES

% 12.0

Commonw ealth Bank

9.1

10%

W H Soul Pattinson

5.5

0%

National Australia Bank

4.9

-10%

Wesfarmers

4.0

Bank of Queensland

3.5

ANZ Bank

3.2

Telstra

2.8

Blackmores

2.7

AP Eagers

2.5

Woolw orths

2.4

Bendigo and Adelaide Bank

2.3

BHP Billiton

2.2

Perpetual

2.2

CSL

2.1

NTA+

Brickw orks

1.7

Year 1

Macquarie Bank

1.7

AGL Energy

1.7

Suncorp Group

1.3

20% $4.00 $3.00 $2.00

-20% $1.00

-30%

$0.00

-40% 2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Exposure (Portfolio) Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

0.24

0.32

11.8%

Year 3

0.45

0.81

12.7%

Year 5

0.60

0.61

13.3%

Inform ation Share price*

2013

2.35

0.50

13.5%

Year 3

0.80

0.67

12.0%

Year 5

0.98

0.52

11.3%

Cash Property Healthcare Financials Industrials

Energy

Staples Materials

* The shareprice bench mark has been compared against the S&P/ASX A ll Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ ASX All Ordinaries Accumulation Index.

TPG Telecom % of Total

1.3 69.1

*+ M easurement of a listed investment company’s performance is calculat ed after all operating expenses, provision and payment of both income and capital gains tax and the reinvestment of dividends, however, does not incorporate franking. Index returns however are entirely before tax measures. Listed investment company returns will consequently be understated relative to the Index return.

LISTED INVESTMENT COMPANIES.

29

BKI INVESTMENT CO (BKI) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Internal

Indirect cost ratio

wit h p er f . f ee:

0.18%

Share price

$1.69

Listed:

2003

Indirect cost ratio

w/ o ut p er f . f ee:

0.18%

Pre-tax NTA

$1.61

Post-tax NTA

$1.51

S&P/ASX 300 Acc umulation

as at 31-Dec-15

Investment Strategy BKI invests w ith a long-term horizon in companies, trust and interest bearing securities, w ith a focus on w ell-managed businesses w ith a profitable history and sound dividend or distribution grow th prospects. The portfolio had been built over 15 years, prior to being acquired by BKI and listed in 2003.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Tom Millner (CEO), Robert Millner, Alexander Payne, Ian Huntley, Will Culbert. Directors: Robert Millner (Chairman), Alexander Payne, David Hall, Ian Huntley

Yield

4.3%

Franking

100%

Grossed up yield

6.1%

Pre-tax NTA

4.7%

Post-tax NTA

11.6%

Historic Dividend (prior 12-mths) $0.072

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: n/a

Options/other

Cash/Debt: $50m cash (31 Dec' 15)

Fully diluted

568.7m

Dividend reinvestment plan: Yes, 5 day VWAP post record date

Market capitalisation

958.3m

568.7m 0.0m

Other: n/a

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

5.6%

3.4%

10.9%

11.9%

11.4%

8.1%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-1.0%

3.0%

7.1%

2.6%

4.9%

2.4%

Performance

5.9%

-0.1%

3.1%

8.3%

7.4%

6.1%

Benchmark

6.5%

-0.4%

2.8%

9.0%

6.7%

5.5%

Share price*

Active return NTA+

Active return

-0.6%

0.3%

0.3%

-0.7%

0.7%

BKI share price v ASX All Ords $ 2.00

6 ,0 00

$ 1.75

5 ,2 50

$ 1.50

4 ,5 00

$ 1.25

3 ,7 50

$ 1.00 Ja n-1 5

Ma y-1 5 BKI

0.6%

Au g-1 5

3 ,0 00 D ec-1 5

ALL ORDINARIES

Share Price and NTA

Top 20 Holdings

%

$2.00

as at 31-Dec-15 Commonw ealth Bank

9.7

National Australia Bank

8.8 7.7

40% Pr em/Disc (RHS)

$1.80

Pre-Tax NTA (LHS)

Share Price (LHS)

30%

$1.60

20%

$1.40

10%

Westpac Bank

$1.20

0%

Telstra

5.4

$1.00

-10%

TPG Telecom

4.8

$0.80

-20%

ANZ Bank

4.6

$0.60

-30%

Wesfarmers

4.5

APA Group

3.5

New Hope Corp

3.0

BHP Billiton

2.9

Standard

Woolw orths

2.7

Deviation

Transurban Group

2.5

AGL Energy

2.5

IAG Limited

1.9

Invocare

1.8

Ramsay Healthcare

1.7

$0.40

-40% 2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Exposure (Top 20)

Inform ation Share price*

2013

Ratio

Sharpe Ratio

Year 1

1.22

0.65

12.5%

Year 3

0.34

0.69

12.3%

Year 5

0.59

0.58

13.2%

Financials Industrial

NTA+ Year 1

0.13

0.03

13.3%

ARB Corporation

1.7

Year 3

-0.30

0.43

11.5%

Suncorp

1.5

Year 5

0.23

0.33

11.2%

ASX

1.5

Resources

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ ASX 300 Accumulation.

Sydney Airports % of Total

1.4 74.1

*+ M easurement of a listed investment company’s performance is calculated after all operat ing expenses, provision and payment of both income and capital gains tax and the reinvestment of dividends, however, does not incorporat e franking. Index returns however are ent irely before tax measures. Listed investment company returns will consequently be understated relative to the Index return.

LISTED INVESTMENT COMPANIES.

30

CARLTON INVESTMENTS (CIN) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Internal

Indirect cost ratio wit h p er f .

Listed:

1970

Indirect cost ratio w/ o ut

S&P/ASX 200 Accumulation f ee:

p er f . f ee:

as at 31-Dec-15

0.09%

Share price

$33.91

0.09%

Pre-tax NTA

$38.66

Post-tax NTA

$31.54

Investment Strategy CIN's investment strategy is to invest in established listed blue chip stocks that provide high levels of sustainable income through fully franked dividends. It is the mandate of the LIC to only dispose of investments through takeovers, mergers or other exceptional circumstances that may arise from time to time.

Premium/(Discount) share price to: Pre-tax NTA

-12.3%

Post-tax NTA

7.5%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Directors: Mr Alan Rydge (Chairman), Mr Anthony Clark and Mr Murray Bleach.

Yield

3.2%

Franking

100%

Grossed up yield

4.5%

$1.08

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: n/a

Options/other

Cash/Debt: $19.9m cash(31 Dec. '15), $0 Debt (30 Jun '15)

Fully diluted

Dividend reinvestment plan: Suspended

Market capitalisation

26.5m 0.1m 26.6m 897.8m

Other: Share buy-back currently in place.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

16.9%

9.3%

24.2%

24.3%

18.3%

11.6%

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

10.3%

8.9%

20.4%

15.0%

11.8%

5.9%

17.0%

14.2%

24.7%

22.2%

16.0%

11.3%

6.5%

-0.5%

2.6%

9.2%

7.0%

5.6%

10.5%

14.7%

22.1%

13.0%

9.0%

5.7%

Share price* Performance Benchmark Active return

CIN share price v ASX All Ords $40.00

7,200

$35.00

6,300

$30.00

5,400

$25.00

4,500

NTA+ Performance Benchmark Active return

$20.00 Jan-15

CI N

Ret urns have been calculated on t he share price on an accumulation basis

Share Price and NTA Pre-Tax NTA (LHS)

Share Price (LHS)

$30.00 $25.00 $20.00 $15.00

2008

2009

2010

2011

2012

Risk/Return Indicators

Year 1

2013

2014

% 49.5 6.5

10%

Westpac Bank

5.8

0%

Commonw ealth Bank

4.8

-10%

AGL

2.8

-20%

ANZ Bank

2.7

-30%

Wesfarmers

2.5

-40%

Telstra

2.4

Bank of Queensland

1.9

Perpetual

1.8

2015

Exposure (Top 20) Sharpe

Standard

Gow ing Bros

1.5

Ratio

Ratio

Deviation

BHP Billiton

1.4

2.50

1.50

14.3%

Bendigo & Adelaide Bank

1.3

James Hardie

1.1

Orica

1.1

James Hardie

0.8

APA Group

0.8

Lend Lease

0.7

Origin Energy

0.5

Inform ation Share price*

ALL
OR DINAR IES

National Australia Bank

30% 20%

2007

3,600 Dec-15

as at 31-Dec-15 Event Hospitality & Ent

40% Prem/Disc (RHS)

$35.00

$10.00 2006

Aug-15

Top 20 Holdings

$45.00 $40.00

May-15

Year 3

1.26

1.32

15.9%

Year 5

1.11

0.95

15.5%

Financials

NTA+ Year 1

3.44

1.72

12.8%

Year 3

1.63

1.75

10.8%

Year 5

1.20

1.23

10.0%

Resources Industrial

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ASX 200 Accumulation.

Rio Tinto % of Total

0.5 90.4

*+ M easurement of a listed investment company’s perf ormance is calculated aft er all operating expenses, provision and payment of both income and capital gains tax and t he reinvestment of dividends, however, does not incorporat e franking. Index returns however are entirely before tax measures. Listed invest ment company returns will consequent ly be understated relative t o the Index return.

LISTED INVESTMENT COMPANIES.

31

DIVERSIFIED UNITED INVESTMENT (DUI) Domestic Focussed

Share Price and NTA Summary

Australian listed equities

Mandate:

Benchm ark:

S&P/ASX 300 Ac c umulation

as at 31-Dec-15

Manager:

Internal

Indirect cost ratio

wit h p er f . f ee:

0.14%

Share price

$3.41

Listed:

1991

Indirect cost ratio

w/ o ut p er f . f ee:

0.14%

Pre-tax NTA

$3.59

Post-tax NTA

$3.18

Investment Strategy DUI seeks a mixture of current income and longer term capital gains w ithin acceptable levels of risk. It takes a medium to longer term view , investing in a diversified portfolio of Australian equities, listed property trusts, short term deposits and international equity via exchange traded funds.

Premium/(Discount) share price to: Pre-tax NTA

-5.0%

Post-tax NTA

7.2%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Directors: Charles Goode AC (Chairman), Stephen Hiscock (Non-Executive Director), Andrew Larke (Non-Executive Director) and Anthony Burgess (Non-Executive Director).

Yield

4.1%

Franking

100%

Grossed up yield

5.9%

$0.14

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: n/a

Options/other

Cash/Debt: $21.0m cash, $85.2m Debt (30 Jun '15)

Fully diluted

206.9m

Dividend reinvestment plan: Yes, 5 day average price from ex date

Market capitalisation

705.6m

206.9m 0.0m

Other: Affiliated w ith AUI

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

4.0%

-0.6%

4.4%

11.6%

8.5%

7.0%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-2.6%

-1.0%

0.6%

2.3%

2.0%

1.3%

Performance

5.6%

-0.3%

1.3%

9.9%

7.2%

5.7%

Benchmark

6.5%

-0.4%

2.8%

9.0%

6.7%

5.5%

-0.9%

0.1%

-1.5%

0.9%

0.5%

0.2%

Share price*

Active return NTA+

Active return

DUI share price v ASX All Ords $4.50

6,000

$4.20

5,600

$3.90

5,200

$3.60

4,800

$3.30

4,400

$3.00 Jan-15

May-15 DU I

Aug-15

4,000 Dec- 15

ALL
ORDI NAR IES

Share Price and NTA

Top 20 Holdings

%

$5.00

as at 31-Dec-15 Commonw ealth Bank

8.9

CSL

7.6

10%

Westpac Bank

7.6

0%

ANZ Bank

6.6

-10%

Transurban Group

5.0

-20%

National Australia Bank

4.7

Vanguard VEU ETF

3.5

Woodside Petroleum

3.4

BHP Billiton

3.4

Rio Tinto

3.2 2.6

40% Prem/Disc (RHS)

Pre- Tax NTA (LHS)

Share Price (LHS)

30%

$4.00

20%

$3.00

$2.00

-30% $1.00 2006

-40% 2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2013

2014

2015

Exposure (Top 20)

Inform ation

Sharpe

Standard

Vanguard VTS ETF

Deviation

Ratio

Ratio

Medibank Private

2.6

Year 1

0.10

0.14

12.1%

Washington H Soul Pattinson

2.3

Year 3

0.28

0.59

14.1%

Wesfarmers

2.2

Year 5

0.24

0.32

15.2%

Asciano

2.1

Woolw orths

2.1

BT Investment Management

1.8 1.7 1.6

Share price*

Industrial Financials

NTA+ Year 1

-0.49

-0.09

14.5%

Resources

Year 3

0.23

0.47

13.7%

AMP

Year 5

0.17

0.27

13.4%

Oil Search

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against t he S&P/ASX 300 Accumulation.

Computershare % of Total

*+ M easurement of a LIC’s performance is calculat ed after all operating expenses, provision and payment of both income and capital gains t ax and t he reinvest ment of dividends, and do not incorporat e f ranking. Index returns however are entirely before any operating expenses or taxation. LIC ret urns will consequent ly be underst at ed relative to t he Index return.

1.5 74.4

LISTED INVESTMENT COMPANIES.

32

WHITEFIELD (WHF) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

White Funds Management Pty Ltd

Indirect cost ratio w it h p er f .

Listed:

1923

Indirect cost ratio w / o ut

S&P/ASX 200 Ind Ac c umulation f ee:

p er f . f ee:

as at 31-Dec-15

0.38%

Share price

$4.34

0.38%

Pre-tax NTA

$4.79

Post-tax NTA

$4.39

Investment Strategy WHF seeks to ow n a portfolio of attactively priced businesses w ith a proven or strengthening ability to deliver shareholder value. Its investment strategy utilises a disciplined quantitative and qualitative process to identify and assess Quality, Intrinsic Value and Mispricing, and w ill seek to invest w here these elements favour their shareholders. It takes a style neutral approach w hich is designed to provide a diversified return despite their focus on industrials.

Premium/(Discount) share price to: Pre-tax NTA

-9.4%

Post-tax NTA

-1.1%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel: Angus Gluskie (Chief Executive Officer). Directors: David Iliffe (Chairman), Angus Gluskie, Martin Fow ler and Graeme Gillmore.

Yield

3.9%

Franking

100%

Grossed up yield

5.6%

$0.17

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: n/a

Options/other

Cash/Debt: $2.0m Cash (31 Dec '15), $0.0m Debt, $41.3m Hybrid (30 Sept '15)

Fully diluted

Dividend reinvestment plan: Yes, 2.5% discount to a 5 day VWAP from (and including) ex-date

Market capitalisation

80.2m 0.4m 80.6m 348.1m

Other: N/A

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

6.7%

-1.2%

6.6%

16.7%

13.9%

6.6%

Benchmark

9.1%

3.9%

8.1%

15.2%

13.5%

7.3%

-2.4%

-5.1%

-1.5%

1.5%

0.4%

-0.7%

10.9%

4.7%

8.8%

16.5%

12.8%

5.8%

Benchmark

9.1%

3.9%

8.1%

15.2%

13.5%

7.3%

Active return

1.8%

0.8%

0.7%

1.3%

-0.7%

-1.5%

Share price*

Active return

WHF share price v ASX All Ords $6.00

6,000

$5.50

5,500

$5.00

5,000

$4.50

4,500

NTA+ Performance

$4.00 Jan-15

May-15

Aug-15

WHF

Share Price and NTA $7.00

40% Prem/Disc (RHS)

Pre- Tax NTA (LHS)

Share Pr ice (LHS)

30%

$6.00

20% $5.00

$3.00 $2.00 $1.00 2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

-0.18

0.35

11.4%

Year 3

0.18

1.17

11.4%

Year 5

0.05

0.86

11.9%

NTA+ Year 1 Year 3 Year 5

2014

0.59 -0.29

0.36 0.92 0.70

17.0% 14.2%

11.5

Westpac Bank

7.9 6.1 5.7

-10%

Telstra

5.5

-20%

CSL

3.8

-30%

Wesfarmers

3.1

-40%

Macquarie Group

2.4

Scentre Group

2.0

Woolw orths

1.9

2015

T ech Util Cash Prop Hlth Fin Mat

Stap Disc

%

as at 31-Dec-15 Commonw ealth Bank

ANZ Bank

Tel

0.21

Top 20 Holdings

National Australia Bank

Exposure (Portfolio)

Inform ation Share price*

2013

ALL
OR DI NAR IES

0%

10%

$4.00

4,000 Dec-15

Ind

13.0%

* The shareprice bench mark has been compared against the S&P/ASX 200 Industrials Accumulat ion Index. + The NTA has been compared against the S&P/ASX 200 Industrials Accumulat ion.

Transurban Group

1.8

Brambles

1.7

Westfield

1.5

Amcor

1.5

Sydney Airport

1.4

QBE Insurance Group

1.3

Ramsay Health Care

1.3

AGL Energy

1.1

Insurance Australia Group

1.0

ResMed % of Total

1.0 63.5

*+ M easurement of a LIC’s performance is calculated aft er all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvestment of dividends, and do not incorporat e f ranking. Index returns however are ent irely before any operating expenses or taxation. LIC ret urns will consequently be underst ated relat ive to the Index return.

LISTED INVESTMENT COMPANIES.

33

AMCIL (AMH) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

S&P/ASX 200 Accumulation

Manager:

Internal

Indirect cost ratio

wit h p er f . f ee:

0.65%

Share price

$0.90

Listed:

2000

Indirect cost ratio

w/ o ut p er f . f ee:

0.65%

Pre-tax NTA

$0.93

Post-tax NTA

$0.86

as at 31-Dec-15

Investment Strategy AMCIL’s concentrated portfolio covers both large and small companies. The number of companies in the portfolio w ill usually comprise 30 to 40 stocks depending on market conditions and thematic investment opportunities. The selection of stocks in the portfolio is based on attractive valuations as w ell as the outlook for grow th and the competitive structure of the industry.

Premium/(Discount) share price to: Pre-tax NTA

-3.8%

Post-tax NTA

4.1%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)*

Investment Personnel: Ross Barker (Managing Director) and Mark Freeman (Chief Investment Officer). Directors: Bruce Teele (Chairman), Ross Barker, Rupert Myer, Roger Brow n and Bob Santamaria.

Yield

4.5%

Franking

100%

Grossed up yield

6.4%

$0.040

*included a 4c special

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

246.0m

Derivatives: Options occasionally used to generate additional income.

Options/other

Cash/Debt: $4.4m cash (30 Sept '15), $0m Debt (30 Jun '15)

Fully diluted

246.0m

Dividend reinvestment plan: 2.5% discount to 5 day average price post ex-date

Market capitalisation

220.2m

0.0m

Other: Affiliated w ith AFIC (AFI), Djerriw arrh (DJW) and Mirrabooka (MIR).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

9.8%

4.2%

6.0%

11.0%

12.3%

10.5%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

3.2%

3.8%

2.2%

1.7%

5.8%

4.8%

Share price*

AMH share price v ASX All Ords $1.20

6,000

$1.10

5,500

$1.00

5,000

$0.90

4,500

NTA+ Performance

6.9%

7.4%

12.2%

10.9%

9.4%

8.0%

Benchmark

6.5%

-0.5%

2.6%

9.2%

7.0%

5.6%

Active return

0.4%

7.9%

9.6%

1.7%

2.4%

2.4%

$0.80 Jan-15

May-15 AMH

Share Price and NTA 40%

$1.20 Prem/Disc (RHS)

Pr e-Tax NTA (LHS)

Share Pr ice (LHS)

30%

$1.00

20% 10%

$0.80 $0.60 $0.40 $0.20 2006

2008

2009

2010

2011

2012

Risk/Return Indicators

Year 1 Year 3 Year 5

Top 20 Holdings

%

as at 31-Dec-15 Commonw ealth Bank

5.5

Brambles

4.5

Oil Search

4.3 3.8

-10%

Telstra

3.3

-20%

Qube Holdings

3.2

-30%

Incitec Pivot

3.0

QBE Insurance Group

3.0

2015

TPG Telecom

2.8

National Australia Bank

2.8

Sharpe

Standard

Treasury Wine Estate

2.8

Ratio

Ratio

Deviation

Lifestyle Communities

2.7

0.23

0.29

Transurban Group

2.5

BHP Billiton

2.3

Mainfreight

2.3

0.12 0.48

0.46 0.58

11.3%

Financials

16.6% Resources

14.7% Industrial

Japara Healthcare

2.3

12.2%

The Citadel Group

2.2 2.1

NTA+ Year 1

2014

ALL ORDINARIES

0%

Exposure (Top 20)

Inform ation Share price*

2013

4,000 Dec-15

CSL

-40% 2007

Aug-15

1.53

0.75

Year 3

0.29

0.68

10.8%

James Hardie Industries

Year 5

0.43

0.53

10.4%

CSG

2.0

ResMed

2.0

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ASX 200 Accumulation.

% of Total

*+ M easurement of a LIC’s performance is calculat ed after all operating expenses, provision and payment of both income and capital gains tax and the reinvestment of dividends, and do not incorporat e franking. Index returns however are entirely before any operating expenses or taxation. LIC returns will consequently be understat ed relative to the Index ret urn.

59.4

LISTED INVESTMENT COMPANIES.

34

QV EQUITIES (QVE) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian Listed Equities

Benchm ark:

S&P/ASX 300 Ex-20 Accum

Manager:

Investors Mutual

Indirect cost ratio w it h p er f .

Listed:

Aug-14

Indirect cost ratio w / o ut

1.04%

f ee:

1.04%

p er f . f ee:

as at 31-Dec-15 Share price

$1.04

Pre-tax NTA

$1.08

Post-tax NTA

$1.05

Investment Strategy QVE’s primary objective is to achieve long term value through a combination of capital grow th and income. This w ill be established by holding a diversified portfolio outside the S&P/ASX 20 Index. QVE w ill hold 20-50 stock predominately from the S&P/ASX 300 –ex Top 20. The Company seeks to invest in quality companies that display four key characteristics; an established competitive advantage, recurring and predictable earnings, strong management, and ability to grow over time. QVE characterises itself as value-driven investor, w ith a bottom-up research approach.

Premium/(Discount) share price to:

Personnel

Dividends (net)

$0.02

Investment Personnel: Anton Tagliaferro, Simon Conn. Directors: Don Stammer (Chairman), Anthony McKillop, John McBain, Graham Hook, Anton Tagliaferro.

Yield

1.9%

Franking

100%

Grossed up yield

2.8%

Pre-tax NTA

-3.8%

Post-tax NTA

-1.5%

Historic Dividend (prior 12-mths)

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

202.9m

Derivatives: Used for arbitrage or to replicate underlying positions

Options/other

166.3m

Cash/Debt: $46.2m cash (31 Dec '15) $0m Debt (30 Jun '15)

Fully diluted

369.2m

Dividend Reinvestment Plan: No

Market capitalisation

210.0m

Other: n/a

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

2.5%

-0.9%

1.4%

n/a

n/a

n/a

Index

6.5%

-0.4%

2.8%

n/a

n/a

n/a

-4.0%

-0.5%

-1.4%

n/a

n/a

n/a

Performance

6.3%

3.9%

9.0%

n/a

n/a

n/a

Benchmark

7.7%

4.8%

10.4%

n/a

n/a

n/a

-1.4%

-0.9%

-1.4%

n/a

n/a

n/a

Share price*

Active return NTA+

Active return

QVE share price v ASX All Ords $1.20

6,000

$1.08

5,400

$0.96

4,800

$0.84

4,200

$0.72

3,600

$0.60 Jan-15

May-15 QVE

Share Price and NTA

3,000 Dec-15

ALL OR DIN AR IE S

Top Holdings

$1.50

40% Pr em/Disc (RHS)

Pre- Tax NTA (LHS)

Share Price (LHS)

30%

$1.25 $1.00 $0.75 $0.50

$0.00 2012

2013

2014

as at 31-Dec-15 Bank of Queensland

20%

Sonic Healthcare

10%

Fletcher Building

0%

Orica

-10%

AGL Energy

-20% $0.25

2011

Aug-15

-30%

Steadfast

-40%

ASX

2015

Ausnet Services Aurizon

Risk/Return Indicators

Exposure (Portfolio)

Inform ation Sharpe Share price*

Trade Me

Standard

Ratio

Ratio

Year 1

0.55

0.90

0.15

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Others

Deviation

NTA+ Year 1

0.75

1.26

Year 3

n/a

n/a

0.11 n/a

Year 5

n/a

n/a

n/a

Cash

Health Care Utilities

Cons Disc Materials Industrials

Financials

* The share price benchmark has been compared against the S&P/ ASX 300 Accumulat ion Index. + The NTA has been compared against the S&P/ ASX 300 ex 20 Accumulat ion Index. *+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

LISTED INVESTMENT COMPANIES.

35

CLIME CAPITAL (CAM) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Clime Asset Management

Indirect cost ratio w it h p er f .

Listed:

Apr-04

Indirect cost ratio w / o ut

All Ordinaries Accumulation f ee:

p er f . f ee:

as at 31-Dec-15

1.79%

Share price

1.79%

Pre-tax NTA

$0.88 $0.94

Post-tax NTA

$0.94

Investment Strategy CAM offers investors the opportunity to invest in a value focused closed end Investment Company managed by a top performing Australian Value Equity Manager Clime Asset Management. CAM applies a four tier investment strategy: Acquire securities in attractive companies w hen the market price on offer trades at a discount to their assessed value; reduce or close positions w hen the market price is w ell above the assessment of value; ensure each investment meets a realistic required return to ensure the risk and return of the portfolio is properly balanced to achieve returns w ithout risking capital; seek investments w ith an enhanced yield; and maintain a high cash position w hen prices are expensive and value is not readily available in the market.

Premium/(Discount) share price to:

Personnel

Dividends (net)*

Investment Personnel: John Abernethy (Chief Investment Officer). Directors: John Abernethy (Chairman), Geoff Wilson, Julian Gosse and Brett Spork

Yield*

5.4%

Franking*

100%

Grossed up yield*

7.7%

Pre-tax NTA

-6.9%

Post-tax NTA

-6.9%

Historic Dividend (prior 12-mths) $0.047

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap, Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: The manager has the ability to use derivatives to manage excessive risk concentrations.

Options/other

Cash (Fixed Income)/Debt: Cash $15.92m (31 Dec '15), Debt $0.0m (30 Jun '15)

Fully diluted

88.5m

Dividend reinvestment plan: Yes, at 1% discount to 4-day VWAP from (and incl.) record date.

Market capitalisation

70.7m

80.8m 7.7m

Other: On market buy-back

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

1.9%

-0.7%

-4.1%

0.2%

6.2%

6.4%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-4.7%

-1.1%

-7.9%

-9.1%

-0.3%

0.7%

2.4%

-0.7%

0.6%

-0.7%

1.2%

5.6%

Share price*

Active return

CAM share price v ASX All Ords $1.20

6,000

$1.10

5,500

$1.00

5,000

$0.90

4,500

NTA+ Performance Benchmark Active return

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-4.2%

-1.1%

-3.2%

-10.0%

-5.3%

-0.1%

$0.80 Jan-15

May-15

Aug-15

CA M

Share Price and NTA

ALL
OR DI NAR IES

Top Holdings

$1.40

40% Prem/Disc (RHS)

$1.30

4,000 Dec-15

Pre-Tax NTA (LHS)

Share Price (LHS)

30%

$1.20

%

as at 31-Dec-15 Domestic Equities

20%

National Australia Bank

5.2

$1.00

10%

Commonw ealth Bank

4.6

$0.90

0%

$0.80

Telstra

3.8

-10%

Computershare

3.4 3.3

$1.10

$0.70

-20%

$0.60 $0.50

-30%

Woolw orths

$0.40

-40%

Retail Food Group

3.0

Flight Centre

2.8

2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Exposure (Net portfolio)

Inform ation

Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

-0.73

-0.83

8.2%

Year 3

-0.77

-0.30

10.4%

Year 5

-0.03

0.23

10.8%

Share price*

2013

NTA+ Year 1

-0.61

-0.21

10.0%

Year 3

-1.33

-0.43

9.3%

Year 5

-0.66

-0.26

9.4%

USD
Cash
&
Equil

2.6

NAB Perpetual Notes Multiplex Convertible Notes

2.5 2.5

International Equities

Hybrids

AUD
Cash
&
Equil

Macquarie Perpetual Notes

Domestic
Equities

American Insurance Group

1.8

Procter & Gamble

1.6

Diageo % of Total

1.6 38.4

In'tl
Equities

*+ The investment performance calculation has been impacted by the initial uplift associated with the 1 for 4 Renounceable Right s issue (CAM PA) issued in April 2007. However, this is offset by the ongoing cost of the issue which has an effective 7.5%fully franked coupon. CAM PA converts into ordinary equity in April 2017. *+ M easurement of a LIC’s performance is calculated after all operating expenses, provision and payment of both income and capital gains tax and the reinvest ment of dividends, and do not incorporate franking or the issue of options. Index returns however are entirely before any operating expenses or taxation. LIC returns will consequently be understated relative t o the Index return.

LISTED INVESTMENT COMPANIES.

36

FLAGSHIP INVESTMENTS (FSI) Domestic Focussed Mandate:

Share Price and NTA Summary

Australian listed equities

Benchm ark:

All Ordinaries Ac cumulation

Manager:

EC Pohl & Co Pty Ltd

Indirect cost ratio w i t h p er f .

Listed:

2000

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

1.43%

Share price

$1.43

1.02%

Pre-tax NTA

$1.86

Post-tax NTA

$1.75

Investment Strategy FSI provides investors w ith access to a diversified Australian investment portfolio. It aims to maintain 90% of available funds in equity investments w ith the balance in cash and equivalent. FSI is best suited to investors w ith a medium to long-term time horizon. FSI’s central investment strategy is to invest in high quality business franchises that have the ability to grow sales and earnings at rates above GDP, producing superior investment returns over the long-term. The company adopts an active investment strategy comprising a broad spectrum of w ell managed companies.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Emmanuel Pohl (Managing Director). Directors: Henry Smerdon AM (Chairman), Emmanuel Pohl, Dominic McGann and Sophie Mitchell

Yield

5.1%

Franking

100%

Grossed up yield

7.3%

Pre-tax NTA

-23.2%

Post-tax NTA

-18.3%

Historic Dividend (prior 12-mths) $0.0725

Key Information

*included a 0.5cent special dividend

Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: n/a

Options/other

Cash/Debt: $0.9m Cash, $0.0m Debt (30 Jun. '15)

Fully diluted

25.3m

Dividend reinvestment plan: Yes.

Market capitalisation

36.1m

25.3m 0.0m

Other: n/a

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

1.8%

6.9%

-0.1%

9.6%

6.0%

5.6%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-4.8%

6.5%

-3.9%

0.3%

-0.5%

-0.1%

12.4%

10.3%

12.0%

13.7%

9.7%

6.3%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

5.8%

9.9%

8.2%

4.4%

3.2%

0.6%

Share price*

Active return

FSI share price v ASX All Ords $1.80

6,000

$1.65

5,500

$1.50

5,000

$1.35

4,500

NTA+ Performance

$1.20 Jan-15

May-15 FSI

Share Price and NTA 40% Prem/Disc (RHS)

Pre-Tax NTA (LHS)

Share Price (LHS)

30%

$2.50 $2.00 $1.50

2010

2011

2012

Risk/Return Indicators

2014

Ratio

Sharpe

Standard

Ratio

Deviation

Year 1

-0.36

-0.19

14.8%

Year 3

0.03

0.40

15.5%

Year 5

-0.03

0.13

17.5%

8.6 6.5

REA Group

5.9

0%

Telstra

5.3

-10%

Westpac Bank

5.3

2015

Exposure (Portfolio)

Inform ation Share price*

2013

%

10%

-40% 2009

as at 31-Dec-15 Macquarie Group

20%

-30% 2008

AL L OR DIN AR IE S

Commonw ealth Bank

-20%

$1.00

2007

4,000 Dec-15

Top 10 Holdings

$3.00

$0.50 2006

Aug-15

CSL

5.0

AMP

4.9

Catapult Group

4.6

Seek

4.4

Carsales.com

4.1

% of Total

54.6

Health Engy Stapl Cash

Fin

Telco

NTA+ Year 1

1.95

0.71

13.1%

Year 3

0.92

0.85

12.1%

Year 5

0.60

0.54

11.0%

IT Mat

Ind

Disc * The shareprice benchmark has been compared against t he S&P/ ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against t he S&P/ ASX All Ordinaries Accumulat ion Index. *+ M easurement of a LIC’s performance is calculat ed af t er all operat ing expenses, provision and payment of bot h income and capit al gains t ax and the reinvest ment of dividends, and do not incorporat e f ranking. Index ret urns however are ent irely bef ore any operat ing expenses or t axat ion. LIC ret urns will consequently be underst at ed relative t o t he Index ret urn.

LISTED INVESTMENT COMPANIES.

37

CBG CAPITAL (CBC) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian Listed Equities

Benchm ark:

S&P/ASX 200 Accum

Manager:

CBG Asset Mgmt

Indirect cost ratio w it h p er f .

Listed:

Dec-14

Indirect cost ratio w / o ut

1.36%

f ee:

1.36%

p er f . f ee:

as at 31-Dec-15 Share price

$0.95

Pre-tax NTA

$1.06

Post-tax NTA

$1.03

Investment Strategy CBC invests in portfolio of listed securities predominately in S&P/ASX200, w ith an emphasis on exS&P/ASX100 securities. The mandate is index unaw are and style neutral. The Manager applies a disciplined investment process, using fundamental analysis to assess each securities’ drivers, and then follow ed up by meeting w ith management. The portfolio w ill typically consist of 30-60 securities and is expected to take material underw eight or overw eight sector positions versus the index.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Ronni Chalmers, Robert Gregory, Vincent Cook, Michael New bold. Directors: Ronni Chalmers (Chairman), Robert Sw il, James Beecher.

Yield

1.6%

Franking

100%

Grossed up yield

2.3%

Pre-tax NTA

-10.2%

Post-tax NTA

-7.4%

Historic Dividend (prior 12-mths) $0.015

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Small Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

24.3m

Derivatives: Used for arbitrage or hedging

Options/other

24.2m

Cash/Debt: $1.26m cash (31 Dec '15) $0m Debt (30 Jun '15)

Fully diluted

48.5m

Dividend Reinvestment Plan: Yes, 2% discount from Oct 15 NTA

Market capitalisation

23.1m

Other: n/a

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

2.8%

1.7%

-0.9%

n/a

n/a

n/a

Index

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-3.8%

1.3%

-4.7%

n/a

n/a

n/a

11.6%

10.6%

8.7%

n/a

n/a

n/a

Benchmark

6.5%

-0.5%

2.6%

9.2%

7.0%

5.6%

Active return

5.1%

11.1%

6.1%

n/a

n/a

n/a

CBC share price v ASX All Ords

Share price*

Active return NTA+ Performance

$1.20

6,000

$1.08

5,400

$0.96

4,800

$0.84

4,200

$0.72

3,600

$0.60 Jan-15

May-15 cb c

Share Price and NTA Pr e- Tax NTA (LHS)

Share Pr ice (LHS)

$1.00 $0.75

$0.25 $0.00 2012

2013

2014

Risk/Return Indicators

%

30%

9.8

20%

Westpac

7.6

10%

ANZ Bank

7.2

0%

Transurban Group

5.3

-20%

Henderson Group

4.8

-30%

BT Investment Mgmt

4.4

-40%

Macquarie Atlas Roads

4.0

National Australia Bank

3.9

Magellan Financials Group

3.9

-10%

$0.50

2015

Exposure (Portfolio)

Inform ation Sharpe

Standard

Ratio

Ratio

Year 1

-0.35

-0.28

0.13

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Deviation

1.00

0.44

0.13

NTA+ Year 1

AL L OR DIN AR IE S

as at 31-Dec-15 Commonw ealth Bank

40% Pr em/Disc (RHS)

$1.25

Share price*

3,000 Dec-15

Top Holdings

$1.50

2011

Aug-15

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

% of Total

Others Insurance Real Estate Utilities IT

Financials

Cons. Disc

Industrials

* The share price benchmark has been compared against t he S&P/ ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ ASX 200 Accumulat ion Index. *+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

50.9

LISTED INVESTMENT COMPANIES.

38

WAM CAPITAL (WAM) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Wilson Asset Management

Indirect cost ratio w it h p er f .

Listed:

1999

Indirect cost ratio w / o ut

All Ordinaries Accumulation f ee:

p erf . f ee:

as at 31-Dec-15

2.67%

Share price

$2.12

1.18%

Pre-tax NTA

$1.97

Post-tax NTA

$1.88

Investment Strategy WAM Capital Limited (WAM) provides investors w ith exposure to a listed investment company w ith an actively managed diversified portfolio of undervalued grow th companies. These are primarily found in the small to mid cap industrial sector. WAM also provides exposure to relative value arbitrage and market mispricing opportunities. The investment objectives are to deliver a grow ing stream of fully franked dividends, to provide capital grow th and to preserve capital. WAM has a tw o fold investment strategy. Research driven: extensive research, focusing on free cash flow , then rating the company’s management, earnings grow th potential, valuation, industry position and catalyst for share price grow th. Market driven: aims to take advantage of short-term relative arbitrage opportunities and mispricing in the market.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Geoffrey Wilson, Chris Stott, Martin Hickson, Matt Haupt and Tobias Yao. Directors: Geoffrey Wilson, Matthew Kidman, James Chirnside, Paul Jensen, Chris Stott and Lindsay Mann.

Yield

6.6%

Franking

100%

Grossed up yield

9.4%

Pre-tax NTA

7.7%

Post-tax NTA

12.8%

Historic Dividend (prior 12-mths) $0.14

Key Information Capital Structure

Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash Style: Large/Medium/Small
Cap, Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: Used for arbitrage and in anticipation of a decline in the market value of that security.

Options/other

Cash (Fixed Income)/Debt: Cash $303.2m (31 Dec. '15)

Fully diluted

468.0m

Dividend reinvestment plan: Yes, 2.5% discount to 4 day VWAP from (and including) ex-date

Market capitalisation

992.2m

468.0m 0.0m

Other: Affiliated w ith WAM Research (ASX code: WAX) and WAM Active (ASX code: WAA).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

9.8%

14.4%

13.2%

15.8%

15.6%

12.2%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

3.2%

14.0%

9.4%

6.5%

9.1%

6.5%

Performance

7.7%

12.1%

18.2%

11.7%

10.2%

10.3%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

1.1%

11.7%

14.4%

2.4%

3.7%

4.6%

Share price*

WAM share price v ASX All Ords $2.40

6,000

$2.20

5,500

$2.00

5,000

$1.80

4,500

NTA+

$1.60 Jan-15

May-15

Aug-15

WAM

4,000 Dec-15

ALL
OR DI NARIES

Share Price and NTA

Top 20 Holdings

$3.00

as at 31-Dec-15 Hunter Hall Global Value

3.4

20%

Smartgroup Corporation

2.6

10%

The A2 Milk Company

2.3

0%

IPH

2.1

-10%

Century Australia

1.9

Eclipx Group

1.8

Treasury Wine Estates

1.6

Myer Holdings

1.6

Mayne Pharma Group

1.5 1.4

40% Prem/Disc (RHS)

Pr e-Tax NTA (LHS)

Share Pr ice (LHS)

30%

$2.50 $2.00 $1.50

-20%

$1.00

-30% $0.50

-40% 2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Exposure (Portfolio)

Inform ation Share price*

2013

Sharpe

Standard

Ratio

Ratio

Deviation

Other

Mantra Group

Fin

%

CSG

1.4

Aveo

1.4

Year 1

0.78

1.35

7.8%

RCG Corporation

1.4

Year 3

0.61

1.40

8.9%

SG Fleet Group

1.3

Year 5

0.94

1.28

9.3%

Cash


Telco

NTA+ Year 1

1.49

1.75

8.8%

Year 3

0.26

0.98

8.5%

Year 5

0.39

0.80

8.1%

Disc

Staples IT

Hlth

Ind

* The shareprice bench mark has been compared against t he S&P/ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against t he S&P/ASX All Ordinaries Accumulation Index.

Bega Cheese

1.1

Domino's Pizza

1.1

iProperty Group

1.1

Nufarm

1.1

JB Hi-Fi

1.1

Super Retail Group % of Total

*+ M easurement of a LIC’s performance is calculat ed af t er all operating expenses, provision and payment of both income and capital gains tax and t he reinvestment of dividends, and do not incorporat e f ranking. Index returns however are ent irely bef ore any operat ing expenses or taxation. LIC ret urns will consequent ly be understated relative to the Index return.

1.1 32.3

LISTED INVESTMENT COMPANIES.

39

MIRRABOOKA INVESTMENTS (MIR) Domestic Focussed

Share Price and NTA Summary

Mandate: Australian listed equities

Benchm ark: S&P Midc ap (50%); Small Ac c (50%)

Manager: Internal

Indirect cost ratio wi t h p erf .

Listed:

2001

Indirect cost ratio w/ o ut

f ee:

p erf . f ee:

as at 31-Dec-15

0.66%

Share price

$2.58

0.66%

Pre-tax NTA

$2.43

Post-tax NTA

$2.18

Investment Strategy MIR objectives are to provide attractive investment returns over the medium to long term through holding core investments in selected small and medium sized companies and to provide attractive dividend returns. MIR focuses on attractive valuations, prospects for strong grow th and the potential to benefit from takeover activity.

Premium/(Discount) share price to: Pre-tax NTA

6.2%

Post-tax NTA

18.3%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel: Ross Barker (Managing Director) and Mark Freeman (Chief Investment Officer). Directors: Terrence Campbell (Chairman), Ian Campbell, David Meiklejohn, Graeme Sinclair, Ross Barker

Yield

6.6%

Franking

100%

Grossed up yield

9.4%

$0.17

*included a 7 cent special dividend

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short Derivatives: Options occasionally used to generate additional income.

Options/other

Cash/Debt: $17.8m cash and $0m debt (31 Dec 2015)

Fully diluted

142.9m

Dividend reinvestment plan: 5% discount to 5 day average price from ex-date

Market capitalisation

368.6m

Ordinary shares

142.9m 0.0m

Other: Affiliated w ith AMCIL (AMH), AFIC (AFI) and Djerriw arrh (DJW).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a. 10 yr p.a.

Performance

4.5%

4.3%

7.8%

13.4%

14.5%

10.3%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-2.2%

3.9%

4.0%

4.1%

8.0%

4.6%

Performance

9.4%

12.5%

17.7%

14.8%

11.9%

8.8%

Benchmark

9.8%

7.4%

10.8%

8.0%

2.2%

3.1%

-0.4%

5.1%

6.9%

6.8%

9.7%

5.7%

Share price*

Active return NTA+

Active return

Share Price and NTA Pre- Tax NTA (LHS)

Share Pr ice (LHS)

$2.00 $1.50

5,6 00

$ 2.60

5,2 00

$ 2.40

4,8 00

$ 2.20

4,4 00

$ 2.00 Jan -15

May-15

Aug-1 5

MIR

ALL
OR DI NARIES

4,0 00 Dec-15

2008

2009

2010

2011

2012

Risk/Return Indicators Inform ation Ratio

2013

2014

% 3.3

20%

3.3

10%

Tassal Group

2.6

0%

Event Hospitality & ENT

2.4

-20%

Lifestyle Com

2.4

-30%

iProperty Group

2.4

-40%

IRESS

2.3

Incitec Pivot

2.2

Vocus Communications

2.2

-10%

$1.00

Share price*

$ 2.80

Qube Holdings

30%

2007

6,0 00

as at 31-Dec-15 Treasury Wine Estates

40%

$2.50

$0.50 2006

$ 3.00

Top 20 Holdings

Pr em/Disc (RHS)

$3.00

MIR share price v ASX All Ords

2015

Exposure (Top 20)

Freedom Foods Group

2.2

ResMed

2.2

Sharpe

Standard

Ratio

Deviation

Nufarm

2.1

Property

Financial

Year 1

0.12

0.27

8.8%

Ansell

2.0

Year 3

0.24

0.65

13.8%

ALS

2.0

Year 5

0.58

0.67

15.2%

Seek

2.0

ARB Corporation

1.9

Wellcom Group

1.9

NTA+ Year 1

0.56

1.06

11.1%

Year 3

0.87

0.95

10.4%

Year 5

1.40

0.70

Industrial

10.5%

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against t he S&P/ M id-cap (50%) and S&P/Small-cap (50%)

Perpetual

1.9

Japara Healthcare

1.8

AMA Group

1.8

% of Total

44.7

*+ M easurement of a LIC’s performance is calculated af ter all operating expenses, provision and payment of both income and capital gains tax and the reinvestment of dividends, and do not incorporat e f ranking. Index returns however are entirely bef ore any operat ing expenses or taxation. LIC returns will consequently be understated relative to the Index return.

LISTED INVESTMENT COMPANIES.

40

WESTOZ INVESTMENT COMPANY LIMITED (WIC) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Westoz Funds Management

Indirect cost ratio w it h p er f .

S&P/ASX Small Ords Accum

Listed:

Sep-09

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

1.31%

Share price

1.31%

Pre-tax NTA

$0.85 $0.96

Post-tax NTA

$1.01

Investment Strategy WIC invests in small to medium sized companies, generally w ith some connection to Western Australia. Its investment objective is to generate consistent positive returns over the medium term, thereby providing a reliable stream of dividends and capital grow th for investors. A concentrated portfolio (generally 10 to 20 stocks) is held and given the focus on Western Australia, above average exposure to the resources sector is a feature. If suitable equity investments are not available, large cash positions may be held from time to time.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Key Personnel: Philip Rees (Executive Director), Dermot Woods, Jay Hughes. Directors: Philip Rees, Jay Hughes (Chairman), Terry Budge, Stephen Tucker, Dermot Woods.

Yield

Pre-tax NTA

-11.1%

Post-tax NTA

-15.8%

Historic Dividend (prior 12-mths) $0.09 10.6%

Franking

100%

Grossed up yield

15.1%

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

129.3m

Derivatives: No (allow ed but not used).

Options/other

Cash/Debt: $43.1m Cash (31 Dec '15) , $0.0m Debt (30 Jun '15)

Fully diluted

142.2m

Dividend reinvestment plan: Yes.

Market capitalisation

109.9m

12.9m

Other: Affiliated w ith Ozgrow th (ASX code: OZG).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

4.3%

-3.2%

-11.7%

0.3%

2.5%

n/a

Share price* Performance Benchmark Active return

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-2.3%

-3.6%

-15.5%

-9.0%

-4.0%

n/a

0.5%

-0.9%

2.0%

-6.0%

-4.2%

n/a

11.3%

7.0%

10.2%

1.7%

-2.5%

1.4%

-10.8%

-7.9%

-8.2%

-7.7%

-1.7%

n/a

NTA+ Performance Benchmark Active return

WIC share price v ASX All Ords $1.20

6,000

$1.00

5,000

$0.80

4,000

$0.60 Jan-15

May-15

Aug-15

WIC

3,000 Dec-15

ALL ORDINARIES

Share Price and NTA

Top Holdings

%

$3.00

as at 31-Dec-15 Finbar Group

7.0

20%

Cedar Woods Properties

7.0

10%

Mount Gibson Iron

6.0

0%

Broadspectrum

5.0

40% Pr em/Disc (RHS)

Pre- Tax NTA (LHS)

Share Pr ice (LHS)

30%

$2.50 $2.00 $1.50

-10% -20%

$1.00

-30% $0.50

-40% 2010

2011

2012

2013

2014

Risk/Return Indicators

Exposure (Portfolio)

Inform ation Share price*

2015

Ratio

Western Areas

4.0

Credit Corp Group

3.0

Programmed Maintenance

3.0

Villa World

3.0

McMillan Shakespeare

3.0

IMF Bentham

3.0

Sharpe

Standard

Other

19.0

Ratio

Deviation

% of Total

63.0

Year 1

-1.63

-1.51

9.5%

Year 3

-0.69

-0.19

16.4%

Year 5

-0.28

-0.07

18.3%

Cash

Industrials

NTA+ Year 1

-0.88

-0.05

14.7%

Year 3

-0.80

-0.58

16.1%

Year 5

-0.19

-0.47

16.6%

Resources

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ ASX Small Ordinaries Accumulat ion Index. *+ M easurement of a LIC’s perf ormance is calculated aft er all operating expenses, provision and payment of bot h income and capital gains t ax and the reinvestment of dividends, and do not incorporat e f ranking. Index returns however are ent irely before any operat ing expenses or t axation. LIC ret urns will consequent ly be underst at ed relat ive to the Index return.

LISTED INVESTMENT COMPANIES.

41

WAM RESEARCH (WAX) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Wilson Asset Management

Indirect cost ratio wi t h p er f .

Listed:

2003

Indirect cost ratio w/ o ut

All Ordinaries Accumulation f ee:

p er f . f ee:

as at 31-Dec-15

4.31%

Share price

$1.29

1.38%

Pre-tax NTA

$1.20

Post-tax NTA

$1.20

Investment Strategy WAM Research Limited (WAX) is a LIC primarily investing in small to medium industrial companies listed on the ASX. The investment objectives are to provide a grow ing stream of fully franked dividends and to achieve a high real rate of return, comprising both income and capital grow th w ithin risk parameters acceptable to the Directors. WAX has a research driven investment strategy, focussed on identifying free cash flow , then rating the company’s management, earnings grow th potential, valuation, industry position and catalyst for share price grow th.

Premium/(Discount) share price to: Pre-tax NTA

7.3%

Post-tax NTA

7.4%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Investment Personnel: Geoffrey Wilson, Chris Stott, Martin Hickson, Matt Haupt and Tobias Yao. Directors: Geoffrey Wilson, Matthew Kidman, Julian Gosse, Chris Stott, Kate Thorley and John Abernethy.

Yield

6.2%

Franking

100%

Grossed up yield

8.9%

$0.08

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: Used for arbitrage and in anticipation of a decline in the market value of that security.

Options/other

Cash (Fixed Income)/Debt: Cash $90.6m (31 Dec. '15)

Fully diluted

172.8m

Dividend reinvestment plan: Yes, 2.5% discount to 4 day VWAP from (and including) ex-date

Market capitalisation

222.9m

172.8m 0.0m

Other: Affiliated w ith WAM Capital (ASX code: WAM) and WAM Active (ASX code: WAA)

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

6.2%

14.9%

18.7%

19.8%

20.8%

10.7%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-0.4%

14.5%

14.9%

10.5%

14.3%

5.0%

Share price*

Active return NTA+ Performance

5.9%

Benchmark Active return

10.6%

WAX share price v ASX All Ords $1.50

6,000

$1.40

5,600

$1.30

5,200

$1.20

4,800 4,400

17.6%

15.2%

12.5%

6.9%

$1.10 $1.00 Jan
15

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-0.7%

10.2%

13.8%

5.9%

6.0%

1.2%

May
15 WAX

Aug
15

4,000 Dec
15

ALL
OR DINAR IES

Returns have been calculat ed on the share price on an accumulat ion basis

Share Price and NTA

Top 20 Holdings

$1.50

as at 31-Dec-15 Smartgroup Corporation

5.2

The A2 Milk Company

4.7

Pr em/Disc (RHS)

Pr e- Tax NTA (LHS)

35%

Share Pr ice (LHS)

25% 15%

$1.00

$0.50

5%

IPH

3.5

-5%

Eclipx Group

3.3

-15%

Mantra Group

2.9

CSG

2.9

RCG Corporation

2.7

-25% -35% -45%

$0.00 2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

Year 1

2014

2015

Exposure (Portfolio)

Inform ation Share price*

2013

Ratio 0.91

Sharpe

Standard

Ratio

Deviation

2.01

Stap

8.0%

Year 3

0.92

1.55

10.6%

Year 5

1.30

1.48

11.6%

1.16

2.29

6.5%

Others Hlth

Disc

IT

NTA+ Year 1 Year 3

0.61

2.12

5.6%

Year 5

0.66

1.62

5.4%

Ind

Cash

%

Fin

* The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ ASX All Ordinaries Accumulation Index.

FlexiGroup

2.1

Sirtex Medical

1.9

Baby Bunting Group

1.9

The Reject Shop

1.9

Event Hospitality and ENT

1.7

Southern Cross Media Group

1.7

Collins Foods

1.6

Austal

1.6

Beacon Lighting Group

1.5

Pro Medicus

1.5

PSC Insurance Group

1.4

Credit Corp Group

1.0

Clime Investment Mgmt % of Total

*+ M easurement of a LIC’s performance is calculated aft er all operat ing expenses, provision and payment of both income and capit al gains t ax and the reinvestment of dividends, and do not incorporat e franking. Index ret urns however are entirely before any operat ing expenses or t axat ion. LIC ret urns will consequent ly be underst at ed relative t o t he Index return.

1.0 46.0

LISTED INVESTMENT COMPANIES.

42

OZGROWTH (OZG) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed

Benchm ark:

S&P/ASX Small Ords Accum

Manager:

Westoz Funds Management

Indirect cost ratio wit h p er f .

Listed:

Jan-08

Indirect cost ratio w/ o ut

f ee:

p er f . f ee:

as at 31-Dec-15

1.51%

Share price

$0.12

1.51%

Pre-tax NTA

$0.15

Post-tax NTA

$0.16

Investment Strategy OZG invests in small to medium sized companies, generally w ith some connection to Western Australia. The group's investment objective is to generate a consistent positive return over the medium term. OZG w ill hold a concentrated portfolio of securities and a variable but significant amount of cash. It w ill also invest in smaller situations (sub $100m market cap) and consider unlisted opportunities.

Premium/(Discount) share price to: Pre-tax NTA

-19.5%

Post-tax NTA

-24.1%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

$0.015

Key Personnel: Philip Rees, Dermot Woods, Jay Hughes. Directors: Michael Jefferies, Philip Rees, Jay Hughes (Chairman), Dermot Woods, Stephen Tucker.

Yield

12.5%

Franking

100%

Grossed up yield

17.9%

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: No (allow ed but not used).

Options/other

Cash/Debt: $11.3m cash (31 Dec. '15), $0 debt/hybrid (30 Jun '15)

Fully diluted

Dividend Reinvestment Plan: Yes

Market capitalisation

361.0m 36.1m 397.1m 43.3m

Other: Affiliated w ith Westoz Investment Company (ASX code: WIC).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

-7.7%

-20.8%

-26.3%

-4.9%

1.0%

n/a

Share price* Performance Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-14.3%

-21.2%

-30.1%

-14.2%

-5.5%

n/a

Performance

-0.7%

-10.3%

-6.1%

-8.1%

-4.4%

n/a

Benchmark

11.3%

7.0%

10.2%

1.7%

6.5%

1.4%

-12.0%

-17.3%

-16.3%

-9.8%

-10.9%

n/a

Active return NTA+

Active return

OZG share price v ASX All Ords $0.20

6,000

$0.18

5,400

$0.16

4,800

$0.14

4,200

$0.12

3,600

$0.10 Jan-15

May-15

Aug-15

OZG

3,000 Dec-15

AL L OR DIN AR IE S

Share Price and NTA

Top Holdings

$0.50

40%

as at 31-Dec-15 Cedar Woods Properties

30%

Cooper Energy

5.0

Mount Gibson Iron

5.0

Automotive Holdings Group

5.0

-20%

Seafarms Group

4.0

-30%

Finbar Group

4.0

QMS Media

3.0

50% Pr em/Disc (RHS)

Pre- Tax NTA (LHS)

Share Price (LHS)

20% 10% 0%

$0.25

-10%

-40% $0.00

-50% 2009

2010

2011

2012

2013

2015

3.0

Vita Group

3.0

Broadspectrum

3.0

Standard

Energia Minerals

3.0

Deviation

Troy Resources

2.0

Southern Cross Electrical

2.0

Exposure (Portfolio)

Inform ation Sharpe

18.0

Western Areas

Risk/Return Indicators Share price*

2014

%

Ratio

Ratio

Year 1

-1.57

-1.74

0.17

Year 3

-0.77

-0.39

0.21

Year 5

-0.32

-0.13

0.20

Year 1

-0.50

0.18

0.18

Year 3

-0.63

0.18

0.18

Year 5

-0.45

0.18

0.18

Cash

% of Total Industrial

NTA+

Resources

The shareprice bench mark has been compared against the S&P/ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ ASX Small Ordinaries Accumulation Index. *+ M easurement of a LIC’s performance is calculated aft er all operating expenses, provision and payment of both income and capital gains tax and t he reinvest ment of dividends, and do not incorporate franking. Index ret urns however are ent irely before any operat ing expenses or taxation. LIC ret urns will consequent ly be understated relat ive to t he Index ret urn.

60.0

LISTED INVESTMENT COMPANIES.

43

CONTANGO MICROCAP (CTN) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities

Benchm ark:

Manager:

Contango Asset Management Ltd

Indirect cost ratio w it h p er f .

Listed:

2004

Indirect cost ratio w / o ut

All Ordinaries Ac cumulation f ee:

p er f . f ee:

as at 31-Dec-15

n/a

Share price

$0.95

n/a

Pre-tax NTA

$1.14

Post-tax NTA

$1.08

+CTN has purchased the rights of CAML(which is an assets manager) - as such the ICR is not reflective of the underlying vehicle

Investment Strategy CTN invests in small and microcap ($10m - $350m at the time of acquisition) companies. Its objective is to outperform its benchmark over the medium to long-term w hile providing for the payment of regular franked dividends. The Manager uses the ‘business cycle’ approach to identify themes that w ill be important drivers of performance for particular sectors and industries. The top dow n research is combined w ith rigorous company analysis to identify stocks that are likely to deliver strong results and out perform. The portfolio typically holds around 60 - 100 stocks.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Key Personnel: George Boubouras (CIO), Bill Laister (Portfolio Manager), Carol Austin, Bill Laister, Justin Farley, Paul Davoren, Stephen Scott, Justin Puli, Jarrod Deakin, Alistair Drummond and Craig Allen. Directors: Mark Kerr (Chairman), David Stevens, Ian Ferres and Glenn Fow les.

Yield

Pre-tax NTA

-16.5%

Post-tax NTA

-11.9%

Historic Dividend (prior 12-mths) $0.077 8.1%

Franking

50%

Grossed up yield

9.8%

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: Portfolio can buy or sell futures to manage market exposure

Options/other

Cash: $4.9m (31 Dec '15) Debt/Hybrid: $25.9m (30 Jun. '15)

Fully diluted

161.4m

Dividend reinvestment plan: Yes, 3% discount to 4 day average price from ex-date

Market capitalisation

153.1m

161.2m 0.3m

Other: Convertible note currently on market. Mature Mar-2020.

Performance

3-m th

6-m th

1 yr

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

3.8%

-8.1%

-1.8%

6.3%

2.1%

6.8%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-2.8%

-8.5%

-5.6%

-3.0%

-4.4%

1.1%

Performance

13.0%

10.4%

11.2%

6.1%

-1.1%

4.9%

Benchmark

11.3%

7.0%

10.2%

1.7%

-2.5%

1.4%

1.7%

3.4%

1.0%

4.4%

1.4%

3.5%

Share price*

Active return

CTN share price v ASX All Ords $1.20

6,000

$1.10

5,500

$1.00

5,000

$0.90

4,500

NTA+

Active return

$0.80 Jan-15

May-15 C TN

Aug-15

4,000 Dec-15

ALL OR DINARIE S

Share Price and NTA

Top 20 Holdings

$2.50

as at 31-December-15 Mayne Pharma

4.3

10%

HUB24

4.1

0%

SG Fleet Group

3.9

-10%

Saracen Minerals

3.0

-20%

QMS Media

2.9

-30%

Automotive Holdings

2.8

Altium

2.5

The A2 Milk Comp

2.3

30% Pr em/Disc (RHS)

Pre- Tax NTA (LHS)

Share Price (LHS)

20%

$2.00 $1.50 $1.00 $0.50

-40% $0.00

-50% 2006

2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Exposure (Top 20)

Inform ation Share price*

2013

Ratio

%

Elanor Investors

2.3

Austal

2.2 2.0

Sharpe

Standard

Villa World

Ratio

Deviation

Orocobre

2.0

GPT Metro Office

2.0

Catapult Group

2.0

Year 1

-0.69

-0.37

12.1%

Year 3

-0.29

0.20

14.7%

Year 5

-0.31

-0.08

20.4%

Financials Industrial

NTA+

Resources

Webjet

1.9

Village Roadshow

1.9

Collins Foods

1.8

Year 1

0.14

0.54

15.9%

Year 3

0.63

0.18

15.2%

360 Capital

1.8

Year 5

0.20

-0.28

17.3%

Mobile Embrace

1.8

* The share price benchmark has been compared against the S&P/ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ASX Small Ordinaries Accumulat ion Index.

Empired % of Total

*+ M easurement of a LIC’s performance is calculat ed af ter all operating expenses, provision and payment of both income and capit al gains tax and the reinvest ment of dividends, and do not incorporat e f ranking. Index ret urns however are entirely bef ore any operating expenses or taxation. LIC ret urns will consequently be understated relative to the Index ret urn.

1.7 49.3

LISTED INVESTMENT COMPANIES.

44

ACORN CAPITAL INVESTMENT FUND (ACQ) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed/unlisted equities

Benchm ark:

S&P/ASX Small Ords Accum

Manager:

Acorn Capital

Indirect cost ratio w it h p er f .

Listed:

May-14

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

1.78%

Share price

1.78%

Pre-tax NTA

$0.85 $1.02

Post-tax NTA

$0.99

Investment Strategy ACQ invests in Listed and Unlisted Microcaps. The manager believe that through an in-house research driven investment process, the pricing inefficiencies that exist in both listed and unlisted microcaps can be exploited to earn returns superior to those available in the broader market.

Premium/(Discount) share price to: Pre-tax NTA

-16.3%

Post-tax NTA

-14.0%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

$0.00

Investment Personnel: Barry Fairley (MD), Robert Routley, Matthew Sheehan, Ben Dalling, David Ransom, Karina Bader, Kylie Molinaro, Robert Bruce, Tony Pearce, Xing Zhang. Directors: Barry Fairley, Robert Brow n, Judith Smith, John Steven (Chairman), David Trude.

Yield

0.0%

Franking

n/a

Grossed up yield

n/a

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: n/a.

Options/other

Cash/Debt: $2.03m cash (31 Dec. '15) $0m Debt (30 Jun '15)

Fully diluted

49.9m

Dividend Reinvestment Plan: No

Market capitalisation

42.4m

49.9m 0.0m

Other: On-market share buy-back

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

17.2%

21.4%

16.4%

n/a

n/a

n/a

Index

11.3%

7.0%

10.2%

1.7%

-2.5%

1.4%

Share price*

5.9%

Active return

14.4%

6.2%

n/a

n/a

n/a

NTA+ Performance

12.8%

11.7%

16.8%

n/a

n/a

n/a

Benchmark

11.3%

7.0%

10.2%

1.7%

-2.5%

1.4%

1.5%

4.7%

6.6%

n/a

n/a

n/a

Active return

ACQ share price v ASX All Ords $1.00

6,000

$0.90

5,400

$0.80

4,800

$0.70

4,200

$0.60

3,600

$0.50 Jan-15

May-15 AC Q

Share Price and NTA

AL L OR DIN AR IE S

Pre- Tax NTA (LHS)

Share Price (LHS)

6.3

20%

Hub24

6.1

10%

Servcorp

4.0

0%

Genea

3.3

-10%

IPH

2.4

-30%

Burson Group

2.3

-40%

Fiducian Group

2.1

30%

$1.25 $1.00 $0.75 $0.50

-20% $0.25 $0.00 2012

2013

2014

Risk/Return Indicators

2015

Exposure (Portfolio)

Inform ation Sharpe Ratio

Ratio

Standard Deviation

Year 1

0.55

0.90

Year 3

n/a

n/a

0.15 n/a

Year 5

n/a

n/a

n/a

Others Healthcare Energy

0.75

1.26

0.11

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Orocobre

2.1

Generation Healthcare

2.0

Touchcorp

2.0

% of Total

32.5

Consumer Disc & Staples

Gross Portfolio Structure Materials

NTA+ Year 1

%

as at 31-Dec-15 RedBubble

40% Pr em/Disc (RHS)

Share price*

3,000 Dec-15

Top Holdings

$1.50

2011

Aug-15

IT Industrials

as at 31-Dec-15 Listed Securities

82%

Unlisted Investments

14%

Cash % of Total

4% 100.0%

Financials * The share price benchmark has been compared against t he S&P/ ASX Small Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ ASX Small Ordinaries Accumulation Index. *+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

LISTED INVESTMENT COMPANIES.

45

BAILADOR TECHNOLOGY INVESTMENT (BTI) Domestic Focussed

Share Price and NTA Summary

Mandate:

Aus/NZ Unlisted Internet Comp

Benchm ark:

8.0% p.a. Hurdle

Manager:

Bailador Investment Management

Indirect cost ratio w it h p er f .

Listed:

Nov-14

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

3.49% 2.34%

as at 31-Dec-15 Share price

$1.00

Pre-tax NTA

$1.25

Post-tax NTA

$1.13

Investment Strategy Offers investors a portfolio of unlisted internet related businesses founded in Aus and NZ. BTI focuses on private companies that are in the ‘expansion stage’ of their business cycle, w ith a demonstrated revenue lead and customer base as w ell as an enterprise value of betw een $10m and $200m. The Manager w ill seek to invest in companies that are looking for capital to grow the existing business, w ith no long term debt obligations. The Manager w ill also focus on companies that apply a subscription based or marketplace revenue model.

Premium/(Discount) share price to:

Personnel

Dividends (net)

$0.00

Investment Personnel: David Kirk, Paul Wilson, Andrea Kow alski, James Johnstone. Directors: David Kirk (Chairman), Paul Wilson, Andrew Bullock, Sankar Narayan, Heith Mackay-Cruise

Yield

0.0%

Pre-tax NTA

-20.4%

Post-tax NTA

-11.8%

Historic Dividend (prior 12-mths)

Franking

n/a

Grossed up yield

n/a

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

62.5m

Derivatives: The Company may use Financial Derivatives

Options/other

62.5m

Cash/Debt: $7.7m cash (31 Dec '15) $0m Debt (30 Jun '15)

Fully diluted

Dividend Reinvestment Plan: No

Market capitalisation

125.0m 62.2m

Other: Divs distributed only w hen investments are realised (after accrued per.fees deducted)

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

11.8%

9.3%

17.1%

n/a

n/a

n/a

Index

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

5.2%

8.9%

13.3%

n/a

n/a

n/a

14.6%

15.5%

14.4%

n/a

n/a

n/a

1.9%

3.9%

8.0%

8.0%

8.0%

8.0%

12.7%

11.6%

6.4%

n/a

n/a

n/a

Share price* Performance

NTA+ Performance Benchmark Active return

BTI share price v ASX All Ords $1.20

6,000

$1.08

5,400

$0.96

4,800

$0.84

4,200

$0.72

3,600

$0.60 Jan-15

May-15 BTI

Share Price and NTA

3,000 Dec-15

AL L OR DIN AR IE S

Top Holdings

$1.50 Pre- Tax NTA (LHS)

Share Price (LHS)

$1.00 $0.75 $0.50

40.1

20%

Viocorp

25.8

10%

Standard Media Index

7.0

0%

iPro Solutions

7.9

-10%

Straker

5.8

-30%

Stackla

3.3

-40%

Rezdy

30%

-20% $0.25 $0.00 2012

2013

2014

2015

% of Total

Risk/Return Indicators Inform ation Sharpe Share price*

Standard

Ratio

Ratio

Year 1

0.55

0.90

0.15

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Year 1

0.75

1.26

0.11

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

%

as at 31-Dec-15 SiteMinder

40% Pr em/Disc (RHS)

$1.25

2011

Aug-15

Deviation

NTA+

* The share price benchmark has been compared against t he S&P/ ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against the 8.0%p.a perf ormance benchmark. *+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

3.3 93.2

LISTED INVESTMENT COMPANIES.

46

AUSTRALIAN LEADERS FUND (ALF) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities, Long/Short Benchm ark:

Manager:

Watermark Funds Management

Indirect cost ratio

wit h p er f . f ee:

1.25%

Share price

$1.40

Listed:

Feb-04

Indirect cost ratio

w/ o ut p er f . f ee:

1.25%

Pre-tax NTA

$1.36

Post-tax NTA

$1.37

All Ordinaries Ac c umulation

as at 31-Dec-15

Investment Strategy ALF looks to invest in leading Australian companies, w ith strong business fundamentals on attractive terms. The group has a long/short mandate that allow s the company to take advantage of both undervalued and overvalued securities. The proceeds raised from short selling securities provides an additional source of funding for the group. These funds are either retained in cash or re-invested into the investment portfolio of shares w e expect to outperform.

Premium/(Discount) share price to: Pre-tax NTA

2.6%

Post-tax NTA

1.8%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)*

Investment Personnel: Justin Braitling (Chief Investment Officer), Tom Richardson (Senior Analyst), Joshua Ross (Analyst), Omkar Joshi (Analyst), Delian Entchev (Analyst), Nick Cameron (Analyst). Directors: Justin Braitling (Chairman), Julian Gosse, John Abernethy and Geoff Wilson.

Yield*

7.2%

Franking*

100%

Grossed up yield*

10.2%

$0.10

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap, Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: The manager has the ability to short-sell securities.

Options/other

Cash/Fixed Income: $421.8m (31 Dec '15), Debt: $0.0m (30 Jun '15)

Fully diluted

268.6m

Dividend Reinvestment Plan: Yes, 3% discount to the 5 day VWAP from (and incl.) ex-div date.

Market capitalisation

374.7m

268.6m 0.0m

Other: affiliated w ith Watermark Market Neutral Fund (WMK)

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

0.4%

17.5%

5.5%

10.8%

14.1%

13.7%

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-6.2%

17.1%

1.7%

1.5%

7.6%

8.0%

-0.7%

6.9%

13.6%

9.5%

8.9%

10.3%

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-7.3%

6.5%

9.8%

0.2%

2.4%

4.6%

Share price*

Active return

ALF share price v ASX All Ords $2.00

6,000

$1.75

5,250

$1.50

4,500

$1.25

3,750

NTA+ Performance Benchmark Active return

$1.00 Jan-15

May-15 ALF

Share Price and NTA

Aug-15

3,000 Dec-15

ALL
ORDI NAR IES

Top Holdings

%

not disclosed $2.00 Prem/Disc (RHS)

$1.80

Pr e-Tax NTA (LHS)

50% 40% 30% 20% 10% 0% -10% -20% -30% -40% -50%

Share Price (LHS)

$1.60 $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Risk/Return Indicators Sharpe

Standard

Ratio

Ratio

Deviation

0.09

0.17

Inform ation Share price* Year 1

16.6%

Gross Portfolio Structure as at 31-Dec-15 Listed Securities (long)

Year 3

0.11

0.49

15.2%

Year 5

0.58

0.75

13.9%

Year 1

0.59

1.77

6.2%

Net exposure

Year 3

0.02

0.69

8.9%

Hybrids/Bonds (long)

Year 5

0.17

0.41

12.7%

Listed Securities (short)

NTA+

* The shareprice benchmark has been compared against the S&P/ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against t he S&P/ASX All Ordinaries Accumulation Index.

90% -105% -16% 0%

Cash

116%

Gross Assets

100%

*+ M easurement of a LIC’s performance is calculat ed after all operating expenses, provision and payment of both income and capital gains t ax and t he reinvest ment of dividends, and do not incorporat e f ranking or the issue of opt ions. Index returns however are entirely before any operating expenses or t axat ion. LIC returns will consequent ly be understated relat ive t o the Index ret urn.

LISTED INVESTMENT COMPANIES.

47

CADENCE CAPITAL (CDM) Domestic Focussed

Share Price and NTA Summary

Mandate:

Aus / Intl listed equities, Long/Short

Benchm ark:

Manager:

Cadence Asset Management

Indirect cost ratio

wi t h p erf . f ee:

2.20%

Share price

Listed:

Dec-06

Indirect cost ratio

w/ o ut p er f . f ee:

1.29%

Pre-tax NTA

$1.34

Post-tax NTA

$1.37

All Ordinaries Ac cumulation

as at 31-Dec-15 $1.54

Investment Strategy

Premium/(Discount) share price to:

CDM is a long-short Australian equities fund, w ith a long bias, that invests predominatly in equities listed on the ASX. More recently, the manager has taken advatange of opportunities in the international markets. The manager uses both fundamental and technical analysis in making investing decisions, employing bottom up research and a disciplined 'Entry and Exit' strategy. Both strategies seek to exploit the inefficient flow of information through the market, individual equity momentum and the cyclical nature of markets.

Pre-tax NTA

14.4%

Post-tax NTA

12.0%

Yield

7.2%

Personnel

Franking

100%

Investment Personnel: Karl Siegling, Wayne Davies, Christopher Garrard, Simon Bonouvrie. Directors: Karl Siegling (Chairman), Wayne Davies, James Chirnside, Ronald Hancock.

Grossed up yield

10.2%

Historic Dividend (prior 12-mths) Dividends (net)

$0.11

*included a 1 cent special dividend

Capital Structure Key Information

Ordinary shares

Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Options/other

Style: Large/Medium/Small
Cap, Balanced/Value/Growth,
Passive/Active,
Long/Short

Fully diluted

268.4m

Derivatives: n/a

Market capitalisation

412.0m

Cash (Fixed Income)/Debt: Cash $87.4m (31 Dec. '15), Debt $0.0m (30 Jun. '15)

CDM share price v ASX All Ords

Dividend reinvestment plan: Yes, 3% discount to 4 day VWAP post ex-date

$2.00

Other: n/a

$1.80

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

7.2%

15.7%

16.4%

10.8%

20.5%

n/a

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

0.6%

15.3%

12.6%

1.5%

14.0%

n/a

2.0%

-0.1%

7.5%

8.7%

9.8%

n/a

6,000 5,250

$1.60 4,500

6.6%

0.4%

3.8%

9.3%

6.5%

-4.6%

-0.5%

3.7%

-0.6%

3.3%

Performance Benchmark Active return

11.4 7.4

Melbourne IT

6.5

Share Pr ice (LHS)

3.6 3.2

0%

Facebook (US)

3.2

-20%

Alphabet (US)

3.1

-30%

Samsung Electronics (KOR)

3.0

National Australia Bank

2.7

-40%

$0.40

-50%

$0.20

-60%

Risk/Return Indicators

2014

2015

Exposure (Net)

Inform ation Sharpe Ratio Ratio

Standard Deviation

Year 1

0.93

1.69

8.1%

Year 3

0.14

0.66

11.2%

Year 5

1.07

1.32

12.8%

Year 1

0.63

0.37

12.9%

Year 3

-0.08

0.56

9.5%

Year 5

0.35

0.59

10.3%

Others Bank

5.4

ANZ Bank

$0.60

2013

5.4

Mastercard (US) Gilead Sciences (US)

-10%

$0.80

Luxottica Group (EUR)

10%

20%

$1.00

2012

3,000 Dec-15

ALL
OR DI NAR IES

Henderson Group

$1.20

2011

Aug-15

n/a

$1.40

2010

CD M

5.7%

30% Pr e-Tax NTA (LHS)

May-15

%

$1.80 Prem/Disc (RHS)

$1.00 Jan-15

Top Holdings

Share Price and NTA

$1.60

3,750

$1.20

as at 31-Dec-15 Macquarie Group

NTA+

Share price*

0.0m

$1.40

Share price*

2009

268.4m

Div
Fin

IPH

2.6

Retail Food Group

2.6

Commonw ealth Bank

2.5

AIG (US) Citigroup (US)

2.4 2.0

Westpac Bank

2.0

% of Total

Telco

69.0

Gross Portfolio Structure

NTA+

Financials Cons

Con
S Software

*+ In M ay 2011CDM received $ 0.22 per CDM share of franking credits when RHG returned the majority o f its assets in the form o f a fully franked dividend. A t the time CDM shares were trading at $ 1.25. These franking credits were worth 17.6% of the CDM share price at the time and are no t reflected in o ur perfo rmance calculations as the calculations are based on pretax NTA and no t po st-tax NTA . * The share price benchmark and NTA have been co mpared against the S&P /A SX A ll Ordinaries A ccumulatio n Index.

as at 31-Dec-15 Listed Securities (long) Listed Securities (short)

83% 8%

Net exposure

76%

Cash

24%

Gross Assets

100%

*+ M easurement of a LIC’s perf ormance is calculat ed aft er all operating expenses, provision and payment of both income and capit al gains t ax and the reinvest ment of dividends, and do not incorporat e f ranking or t he issue of opt ions. Index returns however are ent irely bef ore any operat ing expenses or t axat ion. LIC ret urns will consequent ly be underst at ed relative t o t he Index ret urn.

LISTED INVESTMENT COMPANIES.

48

WAM ACTIVE (WAA) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed equities, Long/Short Benchmark:

Manager:

Wilson Asset Management

Indirect cost ratio

wi t h p er f . f ee:

2.70%

Share price

$1.07

Listed:

2008

Indirect cost ratio

w/ o ut p er f . f ee:

2.01%

Pre-tax NTA

$1.05

Post-tax NTA

$1.05

All Ordinaries Acc umulation

as at 31-Dec-15

Investment Strategy WAM Active Ltd (WAA) offers investors exposure to an active trading style w ith the aim of achieving a sound return w ith a low correlation to traditional markets. The investment objectives are to deliver investors a grow ing income stream in the form of fully franked dividends and to preserve capital in both the short term and long term. WAA uses a market driven approach to investing - it aims to take advantage of short-term relative arbitrage and mispricing in the market. The manager participates in IPOs, rights issues, placements, schemes of arrangement and looks for arbitrage opportunities and discount to asset plays, along w ith other market events view ed as favourably priced.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Geoffrey Wilson, Chris Stott, Martin Hickson, Matt Haupt and Tobias Yao. Directors: Geoffrey Wilson, Matthew Kidman, Chris Stott, Kate Thorley and John Abernethy.

Yield

2.3%

Franking

100%

Grossed up yield

3.3%

Pre-tax NTA

2.0%

Post-tax NTA

2.1%

Historic Dividend (prior 12-mths) $0.025

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap, Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: Used for arbitrage and in anticipation of a decline in the market value of that security.

Options/other

Cash (Fixed Income)/Debt: Cash $8.0m (31 Dec '15)

Fully diluted

Dividend reinvestment plan: Yes, 4 day VWAP from (and including) ex-date

Market capitalisation

34.9m 0.0m 34.9m $37.3m

Other: Affiliated w ith WAM Research (ASX code: WAX) and WAM Capital (ASX code: WAM).

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

12.0%

11.4%

0.5%

5.8%

8.9%

n/a

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

5.4%

11.0%

-3.3%

-3.5%

2.4%

n/a

Performance

5.6%

7.5%

9.6%

6.4%

5.2%

n/a

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-1.0%

7.1%

5.8%

-2.9%

-1.3%

n/a

Share price*

WAA share price v ASX All Ords $1.60

Performance

6,000 5,500

$1.40 5,000 $1.20

4,500

NTA+

4,000

Active return

$1.00 3,500 $0.80 Jan-15

May-15 WAA

Share Price and NTA 40% Prem/Disc (RHS)

Pr e-Tax NTA (LHS)

Share Pr ice (LHS)

30%

4.0

Myer Holdings

3.3

0%

Treasury Wine Estates

3.2

-10%

Mayne Pharma Group

3.0

-20%

Aveo Group

2.8

SG Fleet Group

2.7

Bega Cheese

2.3

Domino's Pizza

2.3

iProperty Group

2.2

Nufarm

2.2

-40% 2011

2012

2013

2014

Risk/Return Indicators Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

-0.15

-0.11

19.5%

Year 3

-0.20

0.15

16.5%

Year 5

0.16

0.37

14.0%

Share price*

2015

Exposure (Portfolio)

Information

Others Fin

Cash

NTA+ Year 1

0.50

1.82

3.8%

Year 3

-0.28

0.47

6.4%

Year 5

-0.13

0.28

5.7%

6.9

10%

-30% $0.50

as at 31-Dec-15 Hunter Hall Global Value

%

Century Australia Investment

20%

$1.00

3,000 Dec-15

ALL
OR DI NAR IES

Top 20 Holdings

$1.50

2010

Aug-15

Tech Health Ind Disc

* The shareprice bench mark has been compared against t he S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against the S&P/ASX All Ordinaries Accumulation Index.

JB Hi-Fi

2.1

Super Retail Group

2.1

National Australia Bank

2.1

Aristocrat Leisure

2.1

Perpetual

2.0

Veda Group

1.9

Galileo Japan Trust

1.9

Templeton Global Grow th Fund

1.6

Henderson Group % of Total

1.6 52.3

*+ M easurement of a LIC’s performance is calculated after all operating expenses, provision and payment of both income and capital gains t ax and the reinvestment of dividends, and do not incorporate f ranking. Index returns however are entirely before any operat ing expenses or taxat ion. LIC ret urns will consequently be understat ed relative to the Index return.

LISTED INVESTMENT COMPANIES.

49

NAOS EMERGING OPPORTUNITIES (NCC) Domestic Focussed Mandate:

Share Price and NTA Summary

Australian listed equities/ Long/Short Benchm ark:

S&P/ASX Small Ords Accum

Manager:

NAOS Asset Management

Indirect cost ratio wit h p erf .

Listed:

Feb-13

Indirect cost ratio w/ o ut

f ee:

p erf . f ee:

as at 31-Dec-15

2.58%

Share price

2.58%

Pre-tax NTA

$0.98 $1.12

Post-tax NTA

$1.09

Investment Strategy NCC invests in Emerging Companies that are listed outside the S&P/ASX 100 Index. The Portfolio w ill hold a concentrated number of positions, w hich on average w ill be 0-15 positions w hen fully invested. Many of these Emerging Companies are often overlooked by the Market and therefore potentially inefficiently priced. The Manager w ill carefully select investment opportunities to create a Portfolio that seeks to exploit market inefficiencies and structure a Portfolio w ith a disciplined and risk controlled approach.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Sebastian Evans (Managing Director), Jeffrey Kim, Robert Miller, Ben Rundle. Directors: David Rickards (Chairman), Warw ick Evans, Sebastian Evans.

Yield

6.4%

Franking

100%

Grossed up yield

9.2%

Pre-tax NTA

-12.9%

Post-tax NTA

-10.6%

Historic Dividend (prior 12-mths) $0.0625

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: used for investment, leverage and hedging purposes.

Options/other

Cash/Debt: $0.3m cash (31 Dec '15), $0 debt/hybrid (30 Jun '14)

Fully diluted

46.9m

Dividend Reinvestment Plan: Yes

Market capitalisation

45.7m

46.9m 0.0m

Other: n/a

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

7.4%

0.9%

-0.4%

n/a

n/a

n/a

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

0.8%

0.5%

-4.2%

n/a

n/a

n/a

9.7%

6.6%

1.3%

n/a

n/a

n/a

Share price*

NCC share price v ASX All Ords $1.20

6,000

$1.10

5,500

$1.00

5,000

$0.90

4,500

NTA+ Performance Benchmark

11.3%

7.0%

10.2%

1.7%

-2.5%

1.4%

Active return

-1.6%

-0.4%

-8.9%

n/a

n/a

n/a

$0.80 Jan-15

May-15 NCC

Share Price and NTA

Aug-15

AL L OR DINARIE S

Top 20 Holdings Not disclosed

$1.50

40% Pr em/Disc (RHS)

Pre-Tax NTA (LHS)

Share Pr ice (LHS)

30%

$1.25

20% 10%

$1.00

0% -10%

$0.75

-20% -30%

$0.50

-40% 2010

2011

2012

2013

2014

Risk/Return Indicators

2015

Net exposure

Inform ation

Sharpe

Standard

Ratio

Ratio

Deviation

Comm Serv

Year 1

-0.33

-0.22

14.2%

Resources

Year 3

n/a

n/a

n/a

Transport

Year 5

n/a

n/a

n/a

Div Fin

Year 1

-0.85

-0.13

11.0%

Cons Serv

Year 3

n/a

n/a

n/a

Med ia

Year 5

n/a

n/a

n/a

Share price*

NTA+

Telco

0

0.1

0.2

4,000 Dec-15

0.3

* The share price benchmark has been compared against t he S&P/ASX All Ordinaries Accumulation Index. + The NTA has been compared against t he S&P/ ASX Small Ordinaries Accumulation Index. *+ M easurement of a LIC’s perf ormance is calculat ed aft er all operat ing expenses, provision and payment of both income and capital gains tax and the reinvestment of dividends, and do not incorporat e franking. Index returns however are entirely before any operating expenses or t axat ion. LIC returns will consequently be understated relative to the Index return.

%

LISTED INVESTMENT COMPANIES.

50

WATERMARK MARKET NEUTRAL (WMK) Domestic Focussed

Share Price and NTA Summary

Australian listed equities

Benchm ark:

Manager:

Watermark Funds Management

Indirect cost ratio

Listed:

Jul-13

Mandate:

RBA Cash Rate

Indirect cost ratio

as at 31-Dec-15

wit h p er f . f ee:

1.82%

Share price

$0.98

w/ o ut p er f . f ee:

1.82%

Pre-tax NTA

$1.08

Post-tax NTA

$1.07

Investment Strategy WMK identifies "strong" companies to invest in, or 'long', and "w eaker" companies to sell, or 'short', w ithout being fully exposed to the volatility and risks of the broader share market. The Manager looks to profit from the mispricing of shares by taking advantage of the natural hedge betw een long and short positions. The longs and shorts are approximately of equal value, w hile investors' capital is retained in cash earning interest. The performance of WMK w ill be the interest on the cash at bank plus the difference in the performance of the Long and Short portfolios.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Justin Braitling (Chief Investment Officer), Tom Richardson (Senior Analyst), Joshua Ross (Analyst), Omkar Joshi (Analyst), Delian Entchev (Analyst), Nick Cameron (Analyst). Directors: Matthew Kidman (Chairman), Justin Braitling, John Abernethy, Rob Ferguson, Stephen van Eyk.

Yield

4.6%

Franking

59%

Grossed up yield

3.9%

Pre-tax NTA

-9.7%

Post-tax NTA

-8.9%

Historic Dividend (prior 12-mths) $0.045

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: used for investment, leverage and hedging purposes.

Options/other

Cash/Debt: $95.5m cash (31 Dec. '15), $0 debt/hybrid (31 Dec. '14)

Fully diluted

87.6m

Dividend Reinvestment Plan: No.

Market capitalisation

85.4m

87.6m 0.0m

Other: affiliated w ith Australian Leaders Fund (ALF)

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

2.1%

23.5%

15.1%

n/a

n/a

n/a

Share price* Performance Index

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

-4.5%

23.1%

11.3%

n/a

n/a

n/a

Performance

1.5%

11.7%

18.8%

n/a

n/a

n/a

Benchmark

0.5%

1.0%

2.1%

2.5%

3.2%

4.3%

Active return

1.0%

10.7%

16.7%

n/a

n/a

n/a

Active return NTA+

WMK share price v ASX All Ords $1.20

6,000

$1.00

5,000

$0.80

4,000

$0.60 Jan-15

May-15

Aug-15

WMK

Share Price and NTA

3,000 Dec-15

ALL ORDIN AR IE S

Top 10 Holdings

%

not disclosed $1.25

40% Prem/Disc (RHS)

Pre-Tax NTA (LHS)

Share Price (LHS)

30% 20%

$1.00

10% 0% -10%

$0.75

-20% -30% $0.50

-40% 2011

2012

2013

2014

Risk/Return Indicators

Net exposure

Inform ation Share price*

2015

Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

0.53

0.76

16.2%

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

NTA+ Year 1

2.59

2.51

6.4%

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Cons Disc Cons Staples Energy Banks Real Estate Other Financials Health Care Industrials Materials Util & Telco

-0.2

Gross Portfolio Structure as at 31-Dec-15 Listed Securities (long) Listed Securities (short) Net exposure Hybrids/Bonds (long)

0

0.2

* The share price benchmark has been compared against the S&P/ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against t he RBA Cash Rate.

98% -103% -5% 0%

Cash

105%

Gross Assets

100%

*+ M easurement of a LIC’s performance is calculat ed after all operating expenses, provision and payment of both income and capital gains t ax and t he reinvest ment of dividends, and do not incorporat e f ranking. Index returns however are entirely before any operating expenses or taxation. LIC ret urns will consequently be underst at ed relative to t he Index return.

LISTED INVESTMENT COMPANIES.

51

MAGELLAN FLAGSHIP FUND (MFF) International Focussed

Share Price and NTA Summary

Mandate:

International Equities (US focus)

Benchm ark:

Manager:

Magellan Asset Management

Indirect cost ratio

wi t h p er f . f ee:

1.61%

Share price

$2.10

Listed:

2006

Indirect cost ratio

w/ o ut p er f . f ee:

1.61%

Pre-tax NTA

$2.10

Post-tax NTA

$1.82

MSCI World Index (AUD)

as at 31-Dec-15

Investment Strategy The primary focus of the portfolio is to invest in large listed international companies assessed to have attractive business characteristics at a discount to their assessed intrinsic values. The Directors believe that this w ill generate superior risk adjusted returns over the medium to long term, w hile minimising the risk of permanent capital loss.

Premium/(Discount) share price to: Pre-tax NTA

-0.1%

Post-tax NTA

15.6%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

$0.02

Investment Personnel: Chris Mackay (MD & Portfolio Manager), Gerald Stack, Dom Giuliano and Nikki Thomas. Directors: Dick Warburton (Chairman), John Ballard, Andy Hogendijk, Chris Mackay

Yield

1.0%

Franking

50%

Grossed up yield

1.2%

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: n/a

Options/other

Cash/Debt: $57.3m cash and $0.0m debt (30 Jun.' 15)

Fully diluted

542.2m

Dividend reinvestment plan: Yes

Market capitalisation

974.8m

464.2m 78.0m

Other: n/a

Performance Performance Benchmark Active return

MFF v MSCI World Index (AUD)

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

$2.40

7,000

12.9%

19.3%

16.8%

32.8%

25.8%

n/a

$2.20

6,300

1.1%

1.3%

8.9%

20.9%

12.8%

2.9%

$2.00

11.8%

18.0%

7.9%

11.9%

13.0%

n/a

$1.80

Share price*

NTA+

5,600 4,900

$1.60

Performance

2.3%

5.8%

13.3%

31.8%

24.5%

n/a

Benchmark

1.1%

1.3%

8.9%

20.9%

12.8%

2.9%

Active return

1.2%

4.5%

4.4%

10.9%

11.7%

n/a

4,200

$1.40 $1.20 Jan-15

May-15

Aug-15

MFF

Share Price and NTA 40% Prem/Disc (RHS)

Pr e- Tax NTA (LHS)

Share Pr ice (LHS)

30%

$2.20 $1.70 $1.20

$0.20 2011

2012

2013

2014

11.0

Low e's

10.7

0%

MasterCard

10.0

-10%

Wells Fargo

10.0

-30%

Bank of America

8.7

-40%

HCA Holdings

6.7

US Bancorp

5.8

2015

Lloyds Banking Group

4.8

Blackrock

4.1

Standard

Bank of New York Mellon

2.9

Deviation

McGraw Hill Financial

2.8

Microsoft

2.3

State Street

2.1

Risk/Return Indicators

Exposure (Top 20)

Inform ation Sharpe Share price*

Ratio

Ratio

12.8

10%

-20%

$0.70

as at 31-Dec-15 Visa

%

Home Depot

20%

2010

M SCI
Wo rl d
In de x
AU D

Top Holdings

$2.70

3,500 Dec-15

Year 1

0.49

0.83

17.0%

Year 3

0.72

1.64

18.0%

Year 5

0.89

1.34

16.5%

NTA+

Industrial

Financials

Year 1

0.75

0.86

Year 3

1.40

2.16

13.2%

Year 5

1.28

1.62

12.9%

JP Morgan Chase

2.0

Schroders

1.2

% of Total

97.9

12.4%

* The shareprice bench mark has been compared against the M SCI World price index in AUD. + The NTA has been compared against the M SCI World price index in AUD.

*+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capit al gains t ax and the reinvestment of dividends, and do not incorporate f ranking. Index returns however are entirely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst at ed relative to the Index ret urn.

LISTED INVESTMENT COMPANIES.

52

PLATINUM CAPITAL (PMC) International Focussed

Share Price and NTA Summary

Mandate:

Absolute Return

Benchm ark:

Manager:

Platinum Asset Management

Indirect cost ratio wi t h p er f .

Listed:

1994

Indirect cost ratio w/ o ut

MSCI All Country World Net Index f ee:

p er f . f ee:

as at 31-Dec-15

1.94%

Share price

$1.90

1.94%

Pre-tax NTA

$1.58

Post-tax NTA

$1.55

Investment Strategy PMC utilises a bottom-up, stock selection methodology and is focused on absolute returns over returns relative to any index. Investments may be in global equities (including Australia), perceived by the Manager as being inappropriately valued by the market. This is combined w ith screening softw are that allow s the Company to select stocks for further evaluation based on a specific criteria. The Criteria is determined by the Manager’s hypothesis regarding social, political or economic change. These factors are intended to bring together a portfolio of stocks w ith a below average risk.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Directors: Bruce Coleman (Chairman), Jim Clegg, Richard Morath.

Yield

5.8%

Franking

100%

Grossed up yield

8.3%

Pre-tax NTA

20.3%

Post-tax NTA

22.6%

Historic Dividend (prior 12-mths) $0.11

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: Yes

Options/other

Cash/Debt: $37.1m cash, $0.0m debt (30 Jun. '15)

Fully diluted

234.6m

Dividend reinvestment plan:Yes, 2.5% discount to 5 day average price post ex-date.

Market capitalisation

445.7m

234.6m 0.0m

Other: n/a

Performance

PMC v MSCI World Index

3-m th

6-m th

1 year

3 Yr p.a.

5 yr p.a.

10 yr p.a.

$ 2.40

7,0 00

Performance

2.2%

10.7%

10.7%

27.7%

9.9%

4.5%

$ 2.20

6,5 00

Benchmark

1.1%

0.6%

9.4%

21.2%

13.5%

4.8%

$ 2.00

Active return

1.1%

10.1%

1.3%

6.5%

-3.6%

-0.3%

$ 1.80

Share price*

6,0 00 5,5 00 5,0 00

NTA+

$ 1.60

Performance Benchmark Active return

-1.4%

-3.5%

2.3%

15.8%

9.5%

4.9%

1.1%

0.6%

9.4%

21.2%

13.5%

4.8%

-2.5%

-4.1%

-7.1%

-5.4%

-4.0%

0.1%

4,5 00

$ 1.40 $ 1.20 Jan -15

4,0 00

May-15 PM C

Share Price and NTA

Aug-1 5

3,5 00 Dec-1 5

M SCI
Worl d
inde x

Top 10 Holdings

%

as at 31-Dec-15 $3.00

60% Prem/Disc (RHS)

Pr e- Tax NTA (LHS)

Share Price (LHS)

Samsung Electronics

3.4

40%

China Pacific A Share

2.8

30%

Ericsson LM-B

2.6

20%

Alphabet

2.6

Tencent Holdings AstraZeneca Carnival

2.5 2.5 2.4

Intesa Sanpaolo

2.2

Eni SpA Cisco Systems

2.0 1.8

50%

$2.50 $2.00 $1.50

10% 0%

$1.00

-10% $0.50 2006

-20% 2007

2008

2009

2010

2011

2012

Risk/Return Indicators

2014

2015

Regional Exposure

Inform ation Sharpe Share price*

2013

Standard

Ratio

Ratio

Year 1

0.09

0.62

Deviation 12.8%

Year 3

0.44

1.65

14.7%

Year 5

0.35

0.39

16.0%

Year 1

-1.21

-0.04

10.7%

Year 3

-0.85

1.05

11.9%

Year 5

-0.68

0.52

11.2%

% of Total

Cash Australia Russia Africa Asia Japan

NTA+ North
America

Europe * The shareprice bench mark has been compared against t he M SCI All Country World Net Index. + The NTA has been compared against t he M SCI All Country World Net Index. *+ M easurement of a LIC’s performance is calculated after all operat ing expenses, provision and payment of bot h income and capit al gains tax and the reinvest ment of dividends, and do not incorporat e franking. Index ret urns however are entirely before any operating expenses or taxation. LIC ret urns will consequent ly be understated relative to t he Index ret urn.

24.8

LISTED INVESTMENT COMPANIES.

53

TEMPLETON GLOBAL GROWTH FUND (TGG) International Focussed

Share Price and NTA Summary

Mandate:

Absolute return

Benchm ark:

Manager:

Templeton Global Equity Group

Indirect cost ratio w it h p erf .

Listed:

1987

Indirect cost ratio w / o ut

MSCI All Country World TR (AUD) f ee:

p er f . f ee:

as at 31-Dec-15

1.14%

Share price

1.14%

Pre-tax NTA

$1.23 $1.39

Post-tax NTA

$1.35

Investment Strategy TGG’s investment process endeavours to identify undervalued equity securities through fundamental company analysis, using a global industry focus and a long-term investment horizon. The investment approach can be characterised by three underlying tenets: Value, Patience and Bottom-Up Analysis. The portfolio of investments is unhedged.

Premium/(Discount) share price to: Pre-tax NTA

-11.8%

Post-tax NTA

-9.1%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

Directors: Tony Killen (chairman), Gregory McGow an, Jennifer Johnson, Martin Warw ick, Michael O'Brien and Joanne Daw son.

Yield

$0.041 3.3%

Franking

17%

Grossed up yield

3.6%

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: none.

Options/other

Cash/Debt: $70.6m cash, $0.0 debt (30 Jun. '15)

Fully diluted

249.7m

Dividend reinvestment plan: Yes. 2.5% discount to the 5 day VWAP leading up to rec date.

Market capitalisation

307.1m

249.7m 0.0m

Other: On-market Buy-back.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

-5.4%

-2.8%

-9.5%

20.3%

12.1%

6.8%

1.1%

0.6%

9.4%

21.2%

13.5%

6.9%

Share price* Performance Benchmark Active return

-6.5%

-3.4%

-18.9%

-0.9%

-1.4%

-0.1%

NTA+ Performance Benchmark Active return

-0.3%

-4.3%

3.3%

17.4%

12.2%

2.8%

1.1%

0.6%

9.4%

21.2%

13.5%

4.8%

-1.4%

-4.9%

-6.1%

-3.8%

-1.3%

-2.0%

TGG v MSCI AC World (AUD) $2.00

7 ,000

$1.80

6 ,300

$1.60

5 ,600

$1.40

4 ,900

$1.20

4 ,200

$1.00 Jan-15

M ay-15 TG G

Share Price and NTA $1.70

Pr e- Tax NTA (LHS)

40%

Share Price (LHS)

30%

$1.50

20% $1.30 $1.10 $0.90

$0.50 2007

2008

2009

2010

2011

2012

2013

2014

Samsung Electronics Roche Holdings

0%

Amgen

-10%

Comcast

-20% $0.70

as at 30-Sep-15 Microsoft

10%

-30%

Sanofi

-40%

Citigroup

2015

JP Morgan Hyundai Motor Corp

Risk/Return Indicators

Regional Exposure

Inform ation

Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

-1.68

-0.82

15.0%

Year 3

-0.07

1.05

16.8%

Year 5

-0.12

0.59

15.9%

Year 1

-1.44

0.04

13.7%

Year 3

-0.82

1.11

12.7%

Year 5

-0.30

0.70

12.2%

Share price*

Other

3 ,500 Dec-15

M SCI
A ll
C ountry
Wo rld
TR
(AUD )

Top Holdings

Pr em/Disc (RHS)

2006

Au g-1 5

Nissan Motor

Holland UK

France

NTA+ US Japan Germany South
Korea China * The shareprice bench mark has been compared against the M SCI All Count ry World TR Index. + The NTA has been compared against t he M SCI All Country World TR Index. *+ M easurement of a LIC’s perf ormance is calculated aft er all operat ing expenses, provision and payment of bot h income and capit al gains t ax and t he reinvest ment of dividends, and do not incorporat e f ranking. Index ret urns however are ent irely bef ore any operat ing expenses or t axation. LIC ret urns will consequently be underst ated relative t o t he Index ret urn.

LISTED INVESTMENT COMPANIES.

54

HUNTER HALL GLOBAL VALUE (HHV) International Focussed

Share Price and NTA Summary

Mandate:

International Equities

Benchm ark:MSCI World Return Net Div Reinvested AUD

Manager:

Hunter Hall Investment Management

Indirect cost ratio w it h p er f .

Listed:

2004

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

1.90%

Share price

$1.18

1.90%

Pre-tax NTA

$1.34

Post-tax NTA

$1.28

Investment Strategy To outperform the MSCI in AUD by 5% pa on a rolling 5-year basis, w hile seeking to avoid significant risk to principal. HHV is managed using a value investment philosophy based on fundamental analysis. It primarily invests in companies listed on domestic and international stock exchanges, w ith a focus on under-researched and undiscovered businesses. HHV has a concentrated portfolio of generally no more than 60 stocks. It can invest up to 100% in international stocks and up to 100% of the foreign currency exposure may be hedged primarily through short-term forw ard contracts.

Premium/(Discount) share price to:

Personnel

Dividends (net)

$0.120

Investment Personnel: Peter Hall AM, James McDonald, Li Zhang, Yizhong Chan, Jonathan Rabinovitz, Simon Bridger. Directors: Paul Jensen(Chairman), Julian Constable, Peter Hall AM.

Yield

10.2%

Pre-tax NTA

-12.2%

Post-tax NTA

-7.6%

Historic Dividend (prior 12-mths)

Franking

6%

Grossed up yield

10.4%

Key Information

*included a 4.0cent special dividend

Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: Only used to hedge against foreign currency exposure.

Options/other

Cash/Debt: $72.0m cash (31 Dec. '15), $0m debt (30 Jun. '15)

Fully diluted

242.4m

Dividend reinvestment plan: Yes

Market capitalisation

286.1m

242.4m 0.0m

Other: Specialist fund investing in International Equities.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

8.8%

5.6%

0.4%

21.2%

12.1%

6.5%

Benchmark

1.5%

2.1%

11.0%

23.4%

15.1%

5.0%

Active return

7.3%

3.5%

-10.6%

-2.2%

-3.0%

1.5%

Performance

5.0%

2.3%

8.4%

18.5%

11.2%

4.8%

Benchmark

1.5%

2.1%

11.0%

23.4%

15.1%

5.0%

Active return

3.5%

0.2%

-2.6%

-4.9%

-3.9%

-0.2%

Share price*

HHV v MSCI World Index (AUD) $2.00

3,000

$1.50

2,000

NTA+

$1.00 Jan-15

1,000 Dec-15

May-15

Aug-15

HHV

MS CI Wor ld In de x (AU D)

Ret urns have been calculated on t he share price on an accumulation basis

Share Price and NTA

Top 10 Holdings 40%

$1.60 Pr em/Disc (RHS)

$1.40

Pre-Tax NTA (LHS)

Share Price (LHS)

30%

$1.00 $0.80 $0.60

% 10.4

Sirtex Medical

8.5

10%

M2 Telecommunications

4.6

0%

Prada

3.4

-10%

Viavi Solutions

2.8

20%

$1.20

as at 31-Dec-15 St Barbara

-20%

$0.40

-30%

Citigroup

2.7

$0.20

-40%

Viacom

2.5

2008

2009

2010

2011

2012

2013

Risk/Return Indicators

Year 1

2015

Regional Exposure Sharpe

Standard

Ratio

Ratio

Deviation

-0.55

-0.11

Inform ation Share price*

2014

-0.13

1.12

16.0%

Year 5

-0.21

0.54

15.6%

Year 1

-0.20

0.37

15.3%

Year 3

-0.48

1.38

10.9%

Year 5

-0.41

0.67

11.1%

2.4

Genw orth Financial

2.0

Gategroup

1.9

% of Total

41.2

Japan US

21.0%

Year 3

Lumentum

Cash

UK China

NTA+ Other

Italy Korea Aus
&
NZ

* The shareprice bench mark has been compared against t he M SCI World Acc Net Return ($A). + The NTA has been compared against the M SCI World Acc Net Return ($A). *+ M easurement of a LIC’s performance is calculated after all operating expenses, provision and payment of both income and capital gains tax and the reinvest ment of dividends, and do not incorporate franking. Index ret urns however are ent irely before any operating expenses or taxat ion. LIC returns will consequently be understated relat ive to the Index return.

LISTED INVESTMENT COMPANIES.

55

PM CAPITAL GLOBAL OPPORTUNITIES (PGF) International Focussed Mandate:

Share Price and NTA Summary

International Equities

Benchm ark:

MSCI World Index (AUD)

Manager:

PM Capital

Indirect cost ratio w it h p er f .

Listed:

Dec-13

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

1.52%

Share price

0.75%

Pre-tax NTA

$1.01 $1.13

Post-tax NTA

$1.11

Investment Strategy PGF offers investors w ith a diversified portfolio of around 40 listed global (including Australia) equities, w ith an objective to provide long term capital grow th to investors. The Manager utilises a fundamental bottom-up, research intensive investment process, investing in a portfolio of global companies w hich the Manager view s as undervalued. Also note, PGF invests on a long term basis w ith at least 7 year time horizon.

Premium/(Discount) share price to: Pre-tax NTA

-10.7%

Post-tax NTA

-8.9%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

$0.00

Investment Personnel: Paul Moore (CIO), Kevin Bertoli, Ashley Pittard, Jarod Daw son, John Whelan, Uday Cheruvu, Clement Tseung, Annabelle Symons, Chen Lin. Directors: Andrew McGill (Chairman), Tom Millner, Brett Spork, Ben Skilbeck

Yield

0.0%

Franking

n/a

Grossed up yield

n/a

Key Information Capital Structure

Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares Derivatives: The manager has the ability to borrow and short sell, w ith a max leverage of 30% of NAV. Options/other Cash/Debt: $0m cash (31 Dec '15), $11.2m Debt (30 Jun '15) Fully diluted

347.3m

Dividend Reinvestment Plan: No

350.8m

0.0m 347.3m

Market capitalisation

Other: The Manager actively manages currency exposure

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

2.0%

-1.0%

-5.2%

n/a

n/a

n/a

Index

1.5%

2.1%

11.0%

23.4%

15.1%

5.1%

Active return

0.5%

-3.1%

-16.2%

n/a

n/a

n/a

Share price*

PGF v MSCI World Index $1.20

7,000

$1.10

6,500 6,000

$1.00

5,500 $0.90 5,000

NTA+

$0.80

Performance Benchmark Active return

-1.0%

-2.8%

-0.5%

n/a

n/a

n/a

1.5%

2.1%

11.0%

23.4%

15.1%

5.1%

-2.5%

-4.9%

-11.5%

n/a

n/a

n/a

4,500

$0.70 $0.60 Jan-15

4,000 May-15

Aug-15

PGF

Share Price and NTA Pre- Tax NTA (LHS)

Share Price (LHS)

6.4

20%

Lloyds Banking Group

6.2

10%

Intercontinental Exchange

5.6

0%

ING Groep

5.6

-10%

Bank of America

5.3

-30%

JP Morgan Chase & Co

5.3

-40%

Bank of Ireland

4.8

30%

$1.25 $1.00 $0.75 $0.50

-20% $0.25 $0.00 2012

2013

2014

Risk/Return Indicators

2015

Portfolio Exposure

Inform ation Sharpe Ratio

Ratio

Year 1

-2.70

-0.57

0.14

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

NTA+ Year 1

-1.58

-0.19

0.16

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Pfizer

3.9

Barclays

3.9

Realogy Holdings

3.8

% of Total

Standard Deviation

%

as at 31-Dec-15 Alphabet

40% Pr em/Disc (RHS)

Share price*

MS CI Wor ld i nd ex

Top Holdings

$1.50

2011

3,500 Dec-15

Financials Services Housing Beverages Healthcare Technology Other Short equity Debt S Cash

-10%

50.8

Domicile of Listing

10%

30%

50%

* The shareprice bench mark has been compared against the M SCI World Accum Index in A UD. + The NTA has been compared against the M SCI World Accum Index in AUD.

as at 31-Dec-15 North America

53.0%

Europe

27.7%

United Kingdom

12.9%

Australia

2.9%

Asia (ex-Japan)

3.5%

% of Total

100.0%

*+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

LISTED INVESTMENT COMPANIES.

56

GLOBAL VALUE FUND (GVF) International Focussed Mandate:

Share Price and NTA Summary

I'ntl (Multi Assets)

Benchm ark:

BBSW 1 Year Rate + 4%

Manager:

Metage Capital Ltd

Indirect cost ratio w it h p er f .

Listed:

Jul-14

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

4.81%

Share price

2.33%

Pre-tax NTA

$1.02 $1.15

Post-tax NTA

$1.11

Investment Strategy GVF invests globally using a discount capture strategy. The fund ow ns a range of global assets classes all purchased at a discount to their intrinsic value. By capturing these discounts for its investors, the manager aims to provide an alternative source of market outperformance compared to more common stock selection strategies. The manager is based in London and has considerable experience in finding international assets trading at a discount to their intrinsic w orth, and in identifying or creating catalysts that w ill be used to unlock this value.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Miles Staude, Tom Sharp, Richard Webb (CEO). Directors: Jonathan Trollip (Chairman), Geoffrey Wilson, Chris Cuffe, Miles Staude.

Yield

2.0%

Franking

100%

Grossed up yield

2.8%

Pre-tax NTA

-11.2%

Post-tax NTA

-7.8%

Historic Dividend (prior 12-mths) $0.02

Key Information Exposure: International/Domestic, Equities/Fixed Incom e/Derivatives/Managed Funds, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

72.9m

Derivatives: Used for arbitrage and to manage currency exposures.

Options/other

50.7m

Cash/Debt: $2.52m cash (31 Dec '15), $0.0m Debt (30 Jun '15)

Fully diluted

Dividend Reinvestment Plan: No

Market capitalisation

123.6m 74.4m

Other: n/a

Performance

GVF v MSCI World Index

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

$1.40

7,000

Performance

1.4%

1.4%

-0.5%

n/a

n/a

n/a

$1.30

6,500

Index

1.1%

1.3%

8.9%

20.9%

12.8%

2.9%

$1.20

6,000

Active return

0.3%

0.1%

-9.4%

n/a

n/a

n/a

$1.10

5,500

$1.00

5,000

$0.90

4,500

$0.80

4,000

Share price*

NTA+ Performance Benchmark Active return

-0.2%

1.2%

12.2%

n/a

n/a

n/a

1.5%

3.1%

6.2%

6.7%

12.8%

8.7%

-1.7%

-1.9%

6.0%

n/a

n/a

n/a

$0.70 Jan-15

May-15

Aug-15

GVF

3,500 Dec-15

MS CI Wor ld i nd ex

Share Price and NTA Top Holdings 40%

$1.50 Pr em/Disc (RHS)

Pre- Tax NTA (LHS)

Share Price (LHS)

20% 10%

Boussard & Gavaudan

7.1

0%

Bluecrest AllBlue Fund

7.0

MS Emerg Market Debt Fun

5.9

30%

$1.25 $1.00 $0.75

-10%

$0.50

-20% $0.25 $0.00 2010

2011

2012

2013

2014

Risk/Return Indicators

Year 1

-30%

North Amer Income Trust

-40%

% of Total

Ratio

Ratio

-1.04

-0.42

Standard Deviation

Private Equity

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Currency Exposure

Other Cash Listed Equities

0.08

Year 3

Real Estate

NTA+ Year 1

0.68

1.08

0.09

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

8.3

5.8 34.1

2015

Exposure (Portfolio)

Inform ation Sharpe Share price*

%

as at 31-Dec-15 HSBC China Dragon Fund

Hedge Fund Fixed Income

%

as at 31-Dec-15 USD

41.0

EUR

20.0

GBP

12.0

CNY

9.0

AUD

10.0

VND

4.0

Other

4.0

% of Total

* The shareprice bench mark has been compared against the M SCI World price index in A UD. + The NTA has been compared against the BB SW 1 Year rate + 4 %. *+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

100.0

LISTED INVESTMENT COMPANIES.

57

ARGO GLOBAL LISTED INFRASTRUCTURE (ALI) Domestic Focussed

Share Price and NTA Summary

Mandate:

Global Listed Infrastructure

Benchm ark:

Manager:

Argo Service Company

Indirect cost ratio w it h p er f .

Listed:

Jul-15

Indirect cost ratio w / o ut

FTSE Infra 50/50 (90%); BoFA Fixed Rat e (10%) f ee:

p er f . f ee:

as at 31-Dec-15

n/a

Share price

$1.75

n/a

Pre-tax NTA

$1.87

Post-tax NTA

$1.89

+Insufficient data.

Investment Strategy ALI invests in listed global infrastructure. Its investment strategy involves a top dow n approach of their Global Investment universe – follow ed by a bottom up analysis of individual securities. The portfolio is concentrated across 50 – 100 stocks w ith a significant w eighting to US Infrastructure securities. The Manager believes this strategy offers a value add to investors as global infrastructure is an asset class that has historically been characterised by stable income, strong returns, low volatility and low correlation to broader equity and fixed income markets.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Rob Becker (PM), Ben Morton (PM), Grace Ding, Humberto Medina, Thuy Quynh Dang, Tyler Rosenlicht, Kathleen Morris, Saagar Parikh. Directors: Ian Martin AM (Chairman), Joycelyn Morton, Gary Simon, Andrea Slattery and Jason Beddow .

Yield

Pre-tax NTA

-6.4%

Post-tax NTA

-7.4%

Historic Dividend (prior 12-mths) $0.000 0.0%

Franking

n/a

Grossed up yield

n/a

Key Information Exposure: International/Domestic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium/Small Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

143.1m

Derivatives: Can hedge against extreme currency movements and enhance income.

Options/other

143.0m

Cash/Debt: $6.15m cash (31 Dec '15), $0m Debt (30 June '15)

Fully diluted

286.1m

Dividend reinvestment plan: No

Market capitalisation

250.4m

Other: Portfolio managed by Cohen & Steers, a leading global manager specialising in listed infrastrucutre.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

-11.2%

n/a

n/a

n/a

n/a

n/a

Share price* Performance Index

-3.3%

n/a

n/a

n/a

n/a

n/a

Active return

-7.9%

n/a

n/a

n/a

n/a

n/a

Performance

-4.6%

n/a

n/a

n/a

n/a

n/a

Benchmark

-3.3%

n/a

n/a

n/a

n/a

n/a

Active return

-1.3%

n/a

n/a

n/a

n/a

n/a

NTA+

ALI share price v MSCI World $2.40

3,000

$2.00

2,500

$1.60

2,000

$1.20 Jan-15

May-15

1,500 Dec-15

Aug-15

AL I

MS CI Wor ld

Share Price and NTA $2.50

Prem/Disc (RHS)

Pr e-Tax NTA (LHS)

40%

Share Price (LHS)

30% $2.00

20% 10%

$1.50

0% $1.00

-10% -20%

$0.50

-30% $0.00

-40% 2010

2011

2012

2013

2014

Risk/Return Indicators

Sector Exposure

Inform ation Share price*

Ratio

Sharpe

Standard

Ratio

Deviation

Year 1

n/a

n/a

n/a

Year 3

n/a

n/a

n/a

Year 5

2015

n/a

n/a

n/a

Regional Exposure

Others

Others

Airports France

Railways Electric Gbl Infra FI

US

NTA+ Year 1

n/a

n/a

n/a

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Spain UK Australia

Pipelines

Canada Com

Toll Roads Gas Distribution

Italy Japan

* The share price and NTA benchmark has been compared against t he FTSE Global Core Infrast ructure 50/ 50 Index(90%) and BoFA M errill Lynch Fixed Rate Preferred Securities Index (10%). *+ M easurement of a LIC’s performance is calculat ed aft er all operating expenses, provision and payment of both income and capital gains t ax and the reinvestment of dividends, and do not incorporate f ranking. Index ret urns ,however, are entirely before any operating expenses or taxation. LIC returns will consequently be underst ated relative to the Index return.

LISTED INVESTMENT COMPANIES.

58

PM CAPITAL ASIAN OPPORTUNITIES FUND (PAF) International Focussed

Share Price and NTA Summary

Mandate:

Asian (Ex- Jpn) Equities

Benchm ark: MSCI Asia (Ex-Jpn) Accumulation

Manager:

PM Capital

Indirect cost ratio w it h p er f .

Listed:

May-14

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

2.09%

Share price

2.09%

Pre-tax NTA

$0.96 $1.07

Post-tax NTA

$1.09

Investment Strategy PAF offers investors w ith a diversified portfolio of around 15-35 Asian listed equities (ex-Japan), of w hich the Manager considers to be undervalued. With a w ide investment universive, the Manager focuses on key thematics (like the gaming industry or the communications industry) that the Manager believes w ill provide long term grow th in Asia. The Manager's investment process is a research intensive, bottom up approach w hich identifies both risk and opportunity.

Premium/(Discount) share price to: Pre-tax NTA

-10.6%

Post-tax NTA

-12.0%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)

$0.00

Investment Personnel: Paul Moore (CIO), Kevin Bertoli, Ashley Pittard, Jarod Daw son, John Whelan, Uday Cheruvu, Clement Tsueng, Annabelle Symons, Chen Lin. Directors: Brett Sport (Chairman), Todd Barlow , Andrew Reeve-Parker, Ben Skilbeck

Yield

0.0%

Franking

n/a

Grossed up yield

n/a

Key Information Exposure: International/Domestic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

55.1m

Derivatives: The manager has the ability to indirectly gear the portfolio by short selling.

Options/other

55.1m

Cash/Debt: $2.4m cash (31 Dec '15), $1.8m Debt (30 Jun '15)

Fully diluted

Dividend Reinvestment Plan: No

Market capitalisation

110.2m 52.9m

Other: The Manager actively manages currency exposure.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

10.3%

1.1%

0.0%

n/a

n/a

n/a

Share price* Performance Index

-0.1%

-8.9%

1.7%

11.8%

6.9%

6.2%

Active return

10.4%

10.0%

-1.7%

n/a

n/a

n/a

6.0%

-2.6%

2.8%

n/a

n/a

n/a

-0.1%

-8.9%

1.7%

11.8%

6.9%

6.2%

6.1%

6.3%

1.1%

n/a

n/a

n/a

NTA+ Performance Benchmark Active return

PAF v MSCI Asia (ex Jpn) Index $1.50

600

$1.25

500

$1.00

400

$0.75 Jan-15

May-15 PA F

Share Price and NTA 40% Pr em/Disc (RHS)

Pre- Tax NTA (LHS)

Share Price (LHS)

$1.25 $1.00 $0.75 $0.50

30%

MS CI ASIA (E x-Jp n)

$0.00 2012

2013

2014

Risk/Return Indicators Ratio

Ratio

-0.12

-0.17

Deviation 0.16

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

NTA+ Year 1

0.11

0.01

0.15

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

10.2 8.1

10%

Mindray Medical

7.1

0%

Baidu Inc

6.2

-10%

HSBC

5.8

-30%

Genting Malaysia

4.5

-40%

Sinopec Kantons Holdings

4.2

Las Vegas Sands

4.2

2015

Zhaopin

4.1

Turquoise Hill

3.8

% of Total

Standard

Year 1

as at 31-Dec-15 Donaco International 51Job Inc

Regional Exposure

Inform ation Sharpe

%

20%

-20% $0.25

Share price*

300 Dec-15

Top Holdings

$1.50

2011

Aug-15

Gaming Internet Infrastructure Technology Consumer Healthcare Financials Commodities Other Cash

0%

58.2

Domicile of Listing

10% 20% 30%

* The shareprice bench mark has been compared against the M SCI Asia (Ex Japan) Net Index. + The NTA has been compared against the M SCI Asia (Ex Japan) Net Index.

as at 31-Dec-15 North America

40.1%

Hong Kong

29.2%

Australia

14.0%

Malaysia

12.7%

Korea % of Total

4.0% 100.0%

*+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

LISTED INVESTMENT COMPANIES.

59

AMP CAPITAL CHINA GROWTH FUND (AGF) International Focussed

Share Price and NTA Summary

Mandate:

China A shares

Benchm ark:

Manager:

AMP Capital Investors

Indirect cost ratio

wi t h p er f . f ee:

1.97%

Share price

$1.11

Listed:

2006

Indirect cost ratio

w/ o ut p er f . f ee:

0.20%

Pre-tax NTA

$1.31

Post-tax NTA

$1.31

S&P/CITIC 300 Total Return ($A)

as at 31-Dec-15

Investment Strategy AGF provides investors w ith access to China A shares, w hich are shares in companies listed on the Shanghai or Shenzhen stock exchanges. AGF’s investment objectives are to achieve long term capital grow th and to outperform the S&P/CITIC 300 Total Return Index. The fund’s manager utilises expert investment managers and Chinese brokers to identify suitable investment opportunities. NB: ‘China A’ shares are restricted to domestic Chinese investors, qualified foreign institutional investors w ho have been granted a Qualified Foreign Institutional Investors (QFII) Licence and approved foreign investors.

Premium/(Discount) share price to:

Personnel

Distributions (net)

$0.339

Investment Personnel: Patrick Ho (Head of Great China Equities) Directors: Stephen Dunne (Chairman), Margaret Payn, Douglas Talbot and Sharon Davis.

Yield

30.5%

Pre-tax NTA

-15.3%

Post-tax NTA

-15.3%

Historic Distribution (prior 12-mths)

Franking

0%

Grossed up yield

30.5%

Key Information Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash

Capital Structure

Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: May invest in futures contracts.

Options/other

Cash/Debt: Cash $2.0m, Debt $0.0m (30 Jun. '15)

Fully diluted

386.3m

Dividend Reinvestment Plan: Yes

Market capitalisation

428.8m

386.3m 0.0m

Other: Specialist fund investing in China A shares.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

18.3%

-0.1%

34.1%

31.8%

15.1%

n/a

Benchmark

8.5%

-15.3%

15.2%

29.7%

13.4%

20.2%

Active return

9.8%

15.2%

18.9%

2.1%

1.7%

n/a

Performance

8.5%

-14.6%

12.2%

26.3%

13.0%

n/a

Benchmark

8.5%

-15.3%

15.2%

29.7%

13.4%

20.2%

Active return

0.0%

0.7%

-3.0%

-3.4%

-0.4%

n/a

Share price* Performance

NTA+

Share Price and NTA 40% Pr em/Disc (RHS)

Pre-Tax NTA (LHS)

Share Pr ice (LHS)

30%

$2.00

20% 10%

$1.50 $1.00 $0.50 $0.00 2011

2012

2013

Risk/Return Indicators

900

$1.00

600

$0.50 Jan-15

May-15

Aug-15

AG F

300 Dec-15

S&P /C iti c300

2014

Sharpe

Standard

Ratio

Ratio

Deviation

0.89

0.82

Cons Stap

Year 3

0.12

0.86

33.1%

Year 5

0.11

0.40

28.9%

NTA+ Year 1

-0.53

0.31

31.0%

Year 3

-0.59

0.75

30.6%

Year 5

-0.08

0.36

26.9%

4.8

China Merchants Bank

3.8

China Minsheng Banking

3.2 2.8 2.7

-20%

China Vanke

2.3

Beijing Originw ater Tech

2.0

2015

Cash

Health Care IT Materials Cons Disc

%

Shanghai Pudong Development

Financials

38.3%

as at 31-Dec-15 Ping An Insurance Group

CRRC Corp

Exposure (Portfolio)

Inform ation Year 1

$1.50

-10%

-40%

Share price*

1,200

0%

-30% 2010

$2.00

Top 10 Holdings

$2.50

2009

AGF share price v S&P/CITIC 300

Industrials

* The shareprice bench mark has been compared against the S&P/CITIC 300 Tot al Ret urn Index ($A) + The NTA benchmark has been compared against S&P/CITIC 300 Total Return Index ($A)

Industrial Bank Co

2.0

Jiangsu Hengrui Medicine Co

2.0

China Everbright Bank

1.9

Ping An Bank Co

1.9

China UN Comm Group

1.8

China CYTS Tours Holding

1.6

GD Pow er Development Co

1.6

Poly Real Estate Group Co

1.6

CITIC Securities Co

1.6

China Merchants Property Dev

1.5

Gree Electric Appliances

1.5

Inner Mongolia Yii Industrials

1.5

Bank of Communications

1.5

% of Total

*+ M easurement of a LIC’s perf ormance is calculat ed aft er all operating expenses, provision and payment of both income and capital gains t ax and the reinvestment of dividends, and do not incorporate franking. Index ret urns however are entirely before any operating expenses or taxation. LIC ret urns will consequently be underst at ed relative to t he Index ret urn.

43.5

LISTED INVESTMENT COMPANIES.

60

HASTINGS HIGH YIELD FUND (HHY) International Focussed

Share Price and NTA Summary

Mandate:

Absolute return

Manager:

Hastings Funds Management

Indirect cost ratio

Listed:

2005

Indirect cost ratio

Benchm ark:

10% absolute return per annum

as at 31-Dec-15

w it h p er f f ee:

2.77%

Share price

$0.10

w / o ut p er f f ee:

2.77%

Pre-tax NTA

$0.12

Post-tax NTA

$0.12

Investment Strategy Historically HHY has provided investors w ith exposure to high yield securities in the infrastructure and essential services sectors. The investment strategy had been to target investments in unrated and noninvestment grade high yield securities in businesses w ith significant barriers to entry, strong financial ratios and a proven track record. Going forw ard, the fund w ill no longer consider further investment, and w ill return surplus cash to investors as assets are redeemed as part of an orderly run-off and w ind up of the fund.

Premium/(Discount) share price to:

Personnel

Dividends (net)"

Key Personnel: Ross Pritchard (Chief Operating Officer) Directors: Alan Cameron (Chairman), Jim Evans, and Anthony Masciantonio

Yield

Pre-tax NTA

-18.8%

Post-tax NTA

-18.8%

Historic Dividend (prior 12-mths) $0.000 0.0%

Franking

0%

Grossed up yield

0.0%

" Dividend is underpinned by capit al returns as assets mat ure. Includes special.

Key Information

Capital Structure

Exposure: International/Domestic, Equities/Fixed Income/Derivatives,
Cash Style: Large/Medium/Small
Cap,
Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: Cross-currency sw aps used for hedging purposes.

Options/other

Cash/Debt: $11.6m"" cash, $0.0m"" Debt (30 Jun. '15)

Fully diluted

Dividend reinvestment plan: Suspended

Market capitalisation

103.1m 0.0m 103.1m 9.8m

Other: Specialist fund investing in fixed income securities.

Performance

3-m th

6-mth

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

3.3%

-5.0%

-45.7%

0.4%

3.5%

n/a

-6.3%

-2.3%

6.5%

14.0%

12.1%

6.6%

9.6%

-2.7%

-52.2%

-13.6%

-8.6%

n/a

6.4%

6.4%

-51.3%

-7.3%

-4.1%

n/a

Share price* Performance Benchmark Active return NTA+ Performance Benchmark

2.4%

4.9%

10.0%

10.0%

10.0%

10.0%

Active return

4.0%

1.5%

-61.3%

-17.3%

-14.1%

n/a

HHY v MSCI World Index (AUD) $ 0.20

4 ,5 00

$ 0.15

3 ,5 00

$ 0.10

2 ,5 00

$ 0.05 Ja n-1 5

Ma y-1 5 H HY

Returns have been calculated on the share price on an accumulation basis

Au g-1 5

1 ,5 00 D ec-1 5

MS CI Wor ld In de x (AU D)

Share Price and NTA $0.70

20% Prem/ Di sc (RHS )

$0.60

Pre-Tax NT A (LHS)

Share P ric e (LHS)

10% 0%

$0.50

-10%

$0.40

-20% $0.30

-30%

$0.20

-40%

$0.10

-50%

$0.00

-60% 2009

2010

2011

2012

2013

2014

2015

Risk/Return Indicators Inform ation Share price*

Ratio

Sharpe

Standard

Ratio

Deviation

Year 1

-1.32

-1.31

37.1%

Year 3

-0.41

-0.09

31.8%

Year 5

-0.32

-0.01

25.3%

NTA+ Year 1

-1.12

-0.99

54.7%

Year 3

-0.40

-0.25

43.4%

Year 5

-0.42

-0.22

33.8%

* The share price benchmark has been compared against the M SCI Index (AUD). + The NTA has been compared against HHY stat ed absolut e return for t he perf ormance calculation and the M SCI Accumulation Index (AUD) for the Risk/ Ret urn calculations. M easurements of a listed invest ment company’s performance based on pre-tax asset backing or share price represent af ter tax measures, and are after the payment of company tax on capit al gains and unfranked income. Index returns however are entirely before tax measures. Listed investment company returns will consequently be understated relat ive to the Index return.

LISTED INVESTMENT COMPANIES.

61

AURORA ABSOLUTE RETURN FUND (ABW) Domestic Focussed

Share Price and NTA Summary

Mandate:

Absolute Return

Benchm ark:

Manager:

Fortitude Capital

Indirect cost ratio w it h p er f .

Listed:

Mar-11

Indirect cost ratio w / o ut

Cash Rate f ee:

p er f . f ee:

as at 31-Dec-15

1.07%

Share price

1.07%

Pre-tax NTA

$0.95 $0.95

Post-tax NTA

$0.95

Investment Strategy ABW has a long track record (unlisted) of providing consistent uncorrelated low volatility returns from investing in Australian equities. The strategy focuses on capital preservation and generating income from short term mispricing and arbitrage opportunities w ithin Australian equities. The strategy achieves absolute returns by applying a mix of different investment strategies that have very little correlation to equity indices. These investment strategies include M&A, Yield, Long/Short and Convergence w hich tend to provide consistent annuity like returns through normal market conditions. The manager has a strong belief that markets can be more volatile and random than expected and hence combines these annuity like strategies w ith a long volatility options overlay. The long volatility overlay provides returns w hen markets move strongly either up or dow n. The managers team varies the fund’s exposure to these strategies in response to market opportunities and risk.

Premium/(Discount) share price to:

Personnel

Dividends (net)*

Investment Personnel: John Corr (CIO), Sheriden Hure, Binh Le, Andrew Ward, Tom Gillespie. Directors: Betty Poon, John Corr, Simon Lindsay (MD).

Yield*

4.7%

Franking*

0.0%

Grossed up yield*

4.7%

Pre-tax NTA

-0.3%

Post-tax NTA

-0.3%

Historic Dividend (prior 12-mths) $0.044

Key Information Capital Structure

Exposure: International/Domestic,
Equities/Fixed
Income/Derivatives,
Cash Style: Large/Medium/Small
Cap, Balanced/Value/Growth,
Passive/Active,
Long/Short

Ordinary shares

Derivatives: The manager has the ability to short-sell securities.

Options/other

Cash (Fixed Income)/Debt: Cash $0.9m, Debt $0.0m (30 Jun. '15)

Fully diluted

17.1m

Dividend reinvestment plan: Yes.

Market capitalisation

16.2m

17.1m 0.0m

Other: n/a

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

-1.1%

2.0%

-4.0%

1.4%

n/a

n/a

6.6%

0.4%

3.8%

9.3%

8.8%

4.3%

-7.7%

1.6%

-7.8%

-7.9%

n/a

n/a

-2.0%

0.7%

1.4%

1.7%

n/a

n/a

6.6%

0.4%

3.8%

9.3%

8.8%

4.3%

-8.6%

0.3%

-2.4%

-7.6%

n/a

n/a

Share price* Performance Benchmark Active return

ABW share price v All Ords $1.20

6,000

$1.10

5,500

$1.00

5,000

$0.90

4,500

NTA+ Performance Benchmark Active return

$0.80 Jan-15

May-15 AB W

Aug-15

4,000 Dec-15

ALL
OR DI NAR IES

Share Price and NTA $1.20

10% Prem/Disc (RHS)

Pre-Tax NTA (LHS)

Share Price (LHS)

$1.10 0% $1.00

$0.90

-10% 2012

2013

2014

2015

Risk/Return Indicators Inform ation Share price*

Ratio

Sharpe

Standard

Ratio

Deviation

Year 1

-0.45

-0.94

7.1%

Year 3

-0.60

-0.37

5.3%

Year 5

n/a

n/a

n/a

NTA+ Year 1

-0.17

-0.45

2.9%

Year 3

-0.61

-0.57

2.9%

Year 5

n/a

n/a

n/a

* The shareprice benchmark has been compared against t he RBA Cash rate. + The NTA has been compared against the RBA Cash rat e. *+ M easurement of a LIC’s performance is calculated af ter all operating expenses, provision and payment of bot h income and capital gains t ax and the reinvestment of dividends, and do not incorporat e f ranking or t he issue of opt ions. Index ret urns however are ent irely before any operating expenses or taxation. LIC returns will consequently be understat ed relative to the Index ret urn.

LISTED INVESTMENT COMPANIES.

62

FUTURE GENERATION INVESTMENT CO (FGX) Domestic Focussed

Share Price and NTA Summary

Mandate:

Fund of funds

Benchm ark:

Manager:

Future Gen Investment Fund

Indirect cost ratio w it h p er f .

Listed:

Sep-14

Indirect cost ratio w / o ut

All Ordinaries Ac cumulation f ee:

p er f . f ee:

as at 31-Dec-15

0.16%

Share price

0.16%

Pre-tax NTA

$1.19

Post-tax NTA

$1.18

+The company does not charge a management fee of a performance fee.

$1.16

Investment Strategy The Company w ill invest in a portfolio of funds that are predominantly investing in Australian equities. The vehicle w ill aim to provide a stream of fully franked dividends, achieve capital grow th and to preserve capital. The managers are able to invest in any asset class and utilise any investment strategy in line w ith their investment mandate. Mandates include large-small cap, broad cap, deep value, active extension, absolute return and activism. The composition of the investment portfolio w ill vary over time, and the maximum allocation to a fund manager w ill be 20% of capital.

Premium/(Discount) share price to:

Personnel

Dividends (net)

Investment Personnel: Geoffrey Wilson, Gabriel Radzyminski, Matthew Kidman. Directors: Jonathan Trollip (Chairman), Geoffrey Wilson, Paul Jensen, Gabriel Radzyminski, David Paradice, David Leeton, Scott Malcolm & Kate Thorley.

Yield

1.7%

Franking

100%

Grossed up yield

2.5%

Pre-tax NTA

-2.5%

Post-tax NTA

-1.3%

Historic Dividend (prior 12-mths) $0.02

Key Information Exposure: International/Dom estic, Equities/Fixed Income/Derivatives/Managed Funds, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

187.3m

Derivatives: Used for arbitrage and in anticipation of a decline in the market value of that security.

Options/other

178.4m

Cash/Debt: $20.5m cash (31 Dec' 15)

Fully diluted

365.7m

Dividend Reinvestment Plan: No

Market capitalisation Other: Lieu of mgmt/perf. fees, a yearly donation of 1.0% of its NTA to support 'children at risk' charities.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

9.4%

5.0%

13.0%

n/a

n/a

n/a

Index

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

2.8%

4.6%

9.2%

n/a

n/a

n/a

Performance

7.5%

9.9%

12.4%

n/a

n/a

n/a

Benchmark

6.6%

0.4%

3.8%

9.3%

6.5%

5.7%

Active return

0.9%

9.5%

8.6%

n/a

n/a

n/a

Share price*

217.3m

FGX share price v ASX All Ords $1.20

6,000

$1.10

5,500

$1.00

5,000

$0.90

4,500

NTA+

$0.80 Jan-15

May-15

Aug-15

FGX

Share Price and NTA Pre- Tax NTA (LHS)

Share Price (LHS)

$1.25 $1.00 $0.75 $0.50

10.3

20%

Bennelong Aus Eq Fund

10.2

10%

Wilson Asset Mgmt Eq Fund

0%

Watermark Absolute Return

7.8

-10%

Eley Griffiths Small Comp

7.6

30%

-20% $0.25 $0.00 2012

2013

2014

Risk/Return Indicators

Tribeca Alpha Plus Fund

7.0

-40%

Paradice Aus Eq Mid Cap

5.4

CI Aus Equity Fund

5.0

Optimal Aus Absolute Trust

4.8

Paradice Large Cap Fund

4.7

2015

Standard

Ratio

Ratio

Year 1

0.82

1.13

0.09

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Cash

Deviation

Absolute Bias

8.3

-30%

Exposure (Portfolio)

Inform ation Sharpe

%

as at 31-Dec-15 Regal Aus Long Short Eq

40% Pr em/Disc (RHS)

Share price*

AL L OR DIN AR IE S

Top Holdings

$1.50

2011

4,000 Dec-15

Long Equities

Sandon Capital Activist

4.0

LHC Capital Aus High Convi

3.6

Discovery Aus Small Comp

3.5

Bennelong Long Short Equity Fund

3.1

Smallco Broadcap Fund

2.7

NTA+

Lanyon Aus Value Fund

1.5

Year 1

1.25

1.17

Qato Capital Market Neutral

1.3

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

0.08

% of Total Market Neutral

* The share price benchmark has been compared against t he S&P/ ASX All Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ ASX All Ordinaries Accumulat ion Index. *+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

90.8

LISTED INVESTMENT COMPANIES.

63

FUTURE GENERATION GLOBAL INVEST CO (FGG) International Focussed

Share Price and NTA Summary

Mandate:

Fund of funds

Benchm ark:

Manager:

Future Gen Global Invest Fund

Indirect cost ratio w it h p er f .

Listed:

Sep-15

MSCI World Index (AUD)

as at 31-Dec-15

n/a

Share price

n/a p er f . f ee: +The company does not charge a management fee of a performance fee.

Pre-tax NTA

$1.07

Post-tax NTA

$1.07

f ee:

Indirect cost ratio w / o ut

$1.17

Investment Strategy FGG w ill invest in a portfolio of funds that are predominantly investing in Global equities. The vehicle’s objective is to provide a stream of fully franked dividends and achieve capital grow th. The fund managers can invest in any asset class and utilise any investment style or strategy. Mandates include long equities, absolute bias and quantitative strategy. The composition of the investment portfolio w ill vary over time, and the maximum single allocation to a fund manager w ill be limited to 10%. The Company itself is also permitted to invest directly into global and domestic equities.

Premium/(Discount) share price to:

Personnel

Dividends (net)

$0.00

Investment Personnel: Geoffrey Wilson, Amanda Gillespie, Aman Ramrakha, Sean Webster. Directors: Belinda Hutchinson (Chair), Geoffrey Wilson, Frank Caserotti, Sue Cato, Karen Penrose, Sarah Morgan.

Yield

0.0%

Pre-tax NTA

9.5%

Post-tax NTA

8.9%

Historic Dividend (prior 12-mths)

Franking

n/a

Grossed up yield

n/a

Key Information Exposure: International/Domestic, Equities/Fixed Income/Derivatives/Managed Funds, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

275.2m

Derivatives: Used to enhanced or protect returns.

Options/other

274.1m

Cash/Debt: $14.1m cash (31 Dec' 15)

Fully diluted

549.3m

Dividend Reinvestment Plan: No

Market capitalisation

322.0m

Other: Lieu of mgmt/perf. fees, a yearly donation of 1.0% of its NTA to support 'mental health' charities.

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

7.3%

n/a

n/a

n/a

n/a

n/a

Index

1.5%

2.1%

11.0%

23.4%

15.1%

5.1%

Active return

5.8%

n/a

n/a

n/a

n/a

n/a

Share price*

FGG v MSCI World Index $1.20

7,000

$1.10

6,500 6,000

$1.00

5,500 $0.90 5,000

NTA+

$0.80

Performance

0.1%

n/a

n/a

n/a

n/a

n/a

Benchmark

1.5%

2.1%

11.0%

23.4%

15.1%

5.1%

-1.4%

n/a

n/a

n/a

n/a

n/a

Active return

4,500

$0.70 $0.60 Jan-15

4,000 May-15

Aug-15

FGG

Share Price and NTA Pre- Tax NTA (LHS)

Share Price (LHS)

$1.25 $1.00 $0.75 $0.50

10.2

20%

Magellan Global Fund

10.1

10%

CI Global Eq (Unhedged)

0%

Antipodes Global Fund

7.6

-10%

VGI Partners Fund

7.5

30%

-20% $0.25 $0.00 2012

2013

2014

Risk/Return Indicators

8.5

-30%

Marsico Global Fund

7.5

-40%

Nikko AM Global Share Fund

6.1

Manikay Global Opp USD

5.1

Ellerston Global Wholesale

5.0

Morphic Global Opp Fund

4.5

2015

Exposure (Portfolio)

Inform ation Sharpe

%

as at 31-Dec-15 Ironbridge Global Focus

40% Pr em/Disc (RHS)

Share price*

AL L OR DIN AR IE S

Top Holdings

$1.50

2011

3,500 Dec-15

NB Systematic Global Eq

3.9

Cooper Investor Asian Tiger Fund

3.4

n/a

Paradice Gbl Small Mid Cap

3.4

n/a

Antipodes Asia Fund

2.5

Tribeca Global TR Fund

2.6

Standard

Ratio

Ratio

Year 1

n/a

n/a

Year 3

n/a

n/a

Year 5

n/a

n/a

n/a

Cash

Deviation

Absolute Bias

NTA+ Year 1

n/a

n/a

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Long Equities

n/a Quant Strat

* The share price benchmark has been compared against the M SCI World Accum Index in AUD. + The NTA has been compared against the M SCI World Accum Index in AUD.

Optimal Jpn Absolute Long

1.6

Avenir Value Fund

1.5

InSync Global Titans Fund

1.5

Hunter Hall Global Eq Trust

1.4

EI Asian Dynamic Fund % of Total

*+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

1.3 91.0

LISTED INVESTMENT COMPANIES.

64

SANDON CAPITAL INVESTMENTS (SNC) Domestic Focussed

Share Price and NTA Summary

Mandate:

Australian listed

Benchm ark:

Manager:

Sandon Capital

Indirect cost ratio w it h p er f .

BBSW 1 Month Rate

Listed:

Dec-13

Indirect cost ratio w / o ut

f ee:

p er f . f ee:

as at 31-Dec-15

2.60%

Share price

2.60%

Pre-tax NTA

$0.85 $0.98

Post-tax NTA

$0.97

Investment Strategy The company’s investment philosophy is to build a concentrated portfolio of undervalued securities w here the manager believes that there are opportunities to encourage change to unlock the securities’ intrinsic value. SNC w ill aim to deliver an absolute positive return over the medium to long term w hile preserving capital and providing grow th.

Premium/(Discount) share price to: Pre-tax NTA

-13.2%

Post-tax NTA

-12.2%

Historic Dividend (prior 12-mths) Personnel

Dividends (net)*

Investment Personnel: Gabriel Radzyminski (Managing Director), Campbell Morgan. Directors: Gabriel Radzyminski (Chairman), Paul Jensen, Matthew Kidman.

Yield*

5.9%

Franking

100%

Grossed up yield*

8.4%

$0.05

Key Information

*included a 1 cent special dividend

Exposure: International/Dom estic, Equities/Fixed Income/Derivatives, Cash

Capital Structure

Style: Large/Medium /Sm all Cap, Balanced/Value/Grow th, Passive/Active, Long/Short

Ordinary shares

Derivatives: No derivatives currently employed

Options/other

Cash/Debt: $5.21m (31 Dec 15) cash, $0 debt/hybrid (30 Jun 15)

Fully diluted

44.3m

Dividend reinvestment plan: No

Market capitalisation

37.6m

44.3m 0.0m

Other: na

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

-1.1%

1.8%

-1.6%

n/a

n/a

n/a

Share price* Performance Index

11.3%

7.0%

10.2%

1.7%

-2.5%

1.4%

-12.4%

-5.2%

-11.8%

n/a

n/a

n/a

3.4%

7.0%

2.6%

n/a

n/a

n/a

Benchmark

11.3%

7.0%

10.2%

1.7%

-2.5%

1.4%

Active return

-7.9%

0.0%

-7.6%

n/a

n/a

n/a

Active return NTA+ Performance

SNC share price v ASX All Ords $1.20

6,000

$1.00

5,000

$0.80

4,000

$0.60 Jan-15

May-15 SN C

Share Price and NTA

Aug-15

3,000 Dec-15

ALL OR DIN AR IE S

Top 20 Holdings Not disclosed

$1.50

40% Pr em/Disc (RHS)

Pre- Tax NTA (LHS)

Share Price (LHS)

$1.25

30% 20%

$1.00

10%

$0.75

0% -10%

$0.50

-20% $0.25

-30%

$0.00

-40% 2012

2013

2014

2015

Risk/Return Indicators Inform ation

Sharpe

Standard

Ratio

Ratio

Deviation

Year 1

-0.85

-0.32

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Year 1

-0.57

-0.02

0.09

Year 3

n/a

n/a

n/a

Year 5

n/a

n/a

n/a

Share price*

0.13

NTA+

* The share price benchmark has been compared against t he S&P/ ASX Small Ordinaries Accumulat ion Index. + The NTA has been compared against the S&P/ ASX Small Ordinaries Accumulation Index. *+ M easurement of a LIC’s perf ormance is calculated af ter all operat ing expenses, provision and payment of both income and capital gains t ax and the reinvest ment of dividends, and do not incorporate f ranking. Index returns however are ent irely bef ore any operating expenses or taxation. LIC returns will consequent ly be underst ated relat ive t o t he Index ret urn.

%

LISTED INVESTMENT COMPANIES.

65

AFIC Notes (AFIG) Price:

Fixed Rate Debt

$113.20

Security view

Recommendation:

Buy Risk Rating:

Low Attractive

114.65

Fair

Expensive

115.49 116.33 117.19

Investment Data Securities on is sue Market capitalisation Face value Issue terms 52 week low/high Gross running yield Gross yield to maturity Swap rate (1.1 years) Trading margin (YTM-swap) Fair valuation margin

2.22m $251.4m $100.00 6.25% fixed $109.60/$123.30 5.52% -3.04% 2.20% -5.24% 0.80%

Issuer Details Issuer ASX code Franking balance (Jun 2015) Gearing (Jun 2015) Dividend Details Cum/ex dividend Ex dividend date Dividend payable Dividend amount (net) Franking Dividend frequency Cumulative/non cumulative Accrued income Redemption Maturity date Redemption value Parent share pric e Conversion price (optional) Conversion shares value Estimated option value Step-up margin

118.07

AFIC AFI $117m 4% Cum div 17 Feb 16 29 Feb 16 $3.0993 0% Half Yearly Mandatory $2.19 28 Feb 17 $100.00 $5.95 $5.0864 $116.98 $11.00 n/a

AFIG is a redeemable convertible note issued by Australia’s largest listed investment company (LIC). This investment is suitable for conservative investors seeking equity exposure with a conversion option that provides the potential for investors to participate in market upside if the AFI share price increases above the $5.0864 conversion price (i.e. 25% premium to the AFI share price at the Dec 2011 issue date). If the AFI share price tracks the performance of the All Ords, a compound annual return of 4.6% is required for the option to be in the money by Feb 2017. The rally in the AFI share price to $5.95 has increased our option value to $11, offsetting the negative yield to maturity. Downside risk is limited by the 6.25% fixed unfranked distribution with redemption in Feb 2017. As gearing is only 4% post the $222m AFIG raising, AFIG redemption risk is extremely low.

Redemption details Unless redeemed or converted earlier, AFIG will be redeemed for $100 on 28 February 2017. In addition, holders have a conversion option into AFI shares at $5.0864 at each half yearly interest payment date.

Parent view With a history dating back to 1928, AFI is Australia’s largest LIC with a $6.4bn portfolio spread over 75 ASX200 companies. AFI is an active manager with an investment philosophy built on taking a medium to longer term view of the quality of a business. AFIC also operates a trading portfolio of short term opportunities of up to 10% of total assets where it seeks to enhance returns by selling call and put options. The scale of the portfolio and management style results in AFI having one of the lowest annual management expense ratios of any LIC of 0.17% of AU M. AFI’s investment performance has also been solid, outperforming the S&P/ ASX200 Accumulation on a 3, 5 and 10 year basis. Security price and running yield Yield

Price

10%

$125 Security Price (RHS)

8%

$120

6%

$115

Gross Running Yield (LHS) 4%

$110

5 Year Swap (LHS) 2%

$105

0% Dec-11

Jun-12

Dec-12

Jun-13

Dec-13

Jun-14

Dec-14

Jun-15

Dec-15

Jun-16

Jun-13

Dec-13

Jun-14

Dec-14

Jun-15

Dec-15

Jun-16

$100 Dec-16

SOURCE: IRESS, BELL POTTER

Fixed distributions $4.00

$3.00

$2.00 Cash

$1.00

$0.00 Dec-11

Jun-12

SOURCE: IRESS, BELL POTTER

Dec-12

Dec-16

LISTED INVESTMENT COMPANIES.

66

Contango MicroCap Convertible Notes (CTNG) Price:

Fixed Rate Debt

$101.55

Security view

Recommendation:

Sell Risk Rating:

Medium Attractive

97.26

Fair

99.02

Expensive

99.91 100.82

102.66

CTNG is a redeemable convertible note, paying interest at a 5.50% fixed rate yield out until its 31 Mar 2020 maturity date. In addition, each CTNG security contains an unlisted option to convert into CTN shares on any half yearly interest payment date at a price of $1.30, compared with the current CTN price of $0.95. This currently requires an annualised CTN share price gain of at least 7.7% for the option to be in the money by the maturity date. We currently value this option at $0.25. The $26.5m CTNG issue is CTN’s only debt facility, representing a gearing ratio (interest bearing liabilities / total equity) of 15.3% at 30 June 2015 (covenant 25%). The key risk investing in CTNG is the impact from a decline in the market value and earnings of CTN’s investment portfolio. This may reduce the ability of CTN to pay scheduled interest and redeem CTNG at maturity, especially if this is associated with a material increase in gearing.

Redemption details Investment Data Securities on is sue Market capitalisation Face value Issue terms 52 week low/high Gross running yield Gross yield to maturity Swap rate (4.1 years) Trading margin (YTM-swap) Fair valuation margin Issuer Details Issuer ASX code Franking balance (Jun 2015) Gearing (Debt / Equity) (Jun 2015) Dividend Details Cum/ex dividend Ex dividend date Dividend payable Dividend amount (net) Franking Dividend frequency Cumulative/non cumulative Accrued income Redemption Maturity date Redemption value Parent share pric e Conversion price (optional) Conversion shares value Estimated option value Step-up margin

0.265m $26.9m $100.00 5.50% fixed $98.85/$103.20 5.42% 5.48% 2.49% 2.99% 3.40% Contango CTN $0.5m 15% Cum div 21 Mar 16 31 Mar 16 $2.7575 0% Half Yearly Mandatory $1.48 31 Mar 20 $100.00 $0.95 $1.30 $73.08 $0.25 n/a

Unless redeemed or converted earlier, CTNG will be redeemed for $100 on 31 March 2020. In addition, holders have a conversion option into CTN shares at $1.30 at each half yearly interest payment date.

Parent view Listing in 2004, CTN is the largest small cap LIC with an investment portfolio of $185m at Dec 2015. Its portfolio is currently diversified across 81 securities where the largest exposure to a single company represents 4.3% of the total portfolio. Its objective is to invest into small and microcap companies typically worth $10350m at the time of investment, seeking to outperform its benchmark of the medium to long term, while providing for the payment of regular franked dividends. The Manager uses the ‘business cycle’ approach to identify themes that will be important drivers of performance for particular sectors and industries. Security price and running yield Yield

Price

10%

$115

8%

$110

Gross Running Yield (LHS) 6%

$105

4%

$100 Security Price (RHS)

2%

$95 5 Year Swap (LHS)

0% Dec-14

$90 Mar-15

Jun-15

Sep-15

Dec-15

Mar-16

Jun-16

Sep-16

Dec-16

Mar-16

Jun-16

Sep-16

Dec-16

SOURCE: IRESS, BELL POTTER

Fixed distributions $3.00

$2.50

$2.00

$1.50 Cash $1.00

$0.50

$0.00 Dec-14

Mar-15

SOURCE: IRESS, BELL POTTER

Jun-15

Sep-15

Dec-15

LISTED INVESTMENT COMPANIES.

67

Whitefield Convertible Resettable Preference Shares (WHFPB) Price:

Fixed Rate Reset Preference Share

$110.00

Security view

Recommendation:

In a low interest rate environment, the 7.00% fully franked coupon fixed until Nov 2018 appears compelling. The investment metrics remain attractive at $110.00 with a gross running yield of 9.09% and a gross yield to first call of 6.37%. The operational risk of WHF is low with its conservative in vestment portfolio typically exposed to the top 100 ASX listed industrial companies, one third of which is weighted to the 4 major banks. With no debt, the $40m WHFPB issue represents 12% of WHF’s $333m of net assets at 30 Sep 2015. This places WHF in a very strong position to pay preference dividends and fund conversion / redemption.

Buy Risk Rating:

Low Attractive

Fair

Expensive

Conversion details 111.36

112.77 113.48 114.20

115.66

Investment Data Securities on is sue 0.40m Market capitalisation $44.0m Face value $100.00 Issue terms 7.0% fully franked 52 week low/high $109.25/$117.00 Gross running yield 9.09% Gross yield to first call 6.37% Swap rate (2.8 years) 2.23% Trading margin 4.14% Fair valuation margin 2.90% Issuer Details Issuer ASX code Franking balance (Mar 2015) Gearing (ND+Pref/E) (Sep 2015)

Whitefield WHF $15m 12%

Dividend Details Cum/ex dividend Ex dividend date Dividend payable Dividend amount (net) Franking Dividend frequency Cumulative/non cumulative Accrued income

Cum div 20 May 16 14 Jun 16 $3.50 100% Half Yearly Non $0.49

Conversion Exchange / reset Conversion discount Parent share pric e Conversion shares value Step-up margin

30 Nov 18 up to 3.5% $4.34 $103.63 n/a

At the first reset date (30 Nov 2018), if WHF wishes to amend WHFPB terms, it needs to provide holders with details of the new terms at least 50 business days prior to the reset date. WHF may also elect to convert or redeem WHFPB at the reset date. The reset date also provides WHFPB holders the option to elect for Holder Exchange, where WHF has the option to convert WHFPB into shares, or redeem for cash. All future reset dates post 2018 will occur at 3 year intervals. Non payment of scheduled WHFPB dividends provides investors with the right to request Holder Exchange. Investors may also request Holder Exchange under a Holder Trigger Event if WHF’s gearing (net debt + prefs / equity) exceeds 35%. WHF also has a conversion right under a Gearing Event if gearing exceeds 25%.

Parent view With a history dating back to 1923, WHF is one of Australia’s oldest listed investment companies. WHF’s investment portfolio at 30 Sep 2015 comprised $4m of cash and $385m of ASX listed securities across 63 industrial companies. Security price and running yield Yield

Price

12%

$120 Security Price (RHS)

10%

$115

8%

$110 Gross Running Yield (LHS)

6%

$105

5 Year Swap (LHS) 4%

$100

2% Aug-12

$95 Feb-13

Aug-13

Feb-14

Aug-14

Feb-15

Aug-15

Feb-16

Aug-16

Feb-16

Aug-16

SOURCE: IRESS, BELL POTTER

Fixed distributions $6.00

$5.00

$4.00

$3.00 Franking $2.00

$1.00 Cash $0.00 Aug-12

Feb-13

SOURCE: IRESS, BELL POTTER

Aug-13

Feb-14

Aug-14

Feb-15

Aug-15

LISTED INVESTMENT COMPANIES.

Appendix A: Glossary of terms Annualised Compound Total Returns: The Annualised Compound Total Return calculates the constant yearly return that would result in the initial value of an investment reaching its present value. Active Management: Investing with the goal of outperforming a benchmark index. Balanced Investing: Investing in securities with neither a preference for Growth or Value investing. Beta: In the context of this report, a Beta is a representation of the tendency of a company’s share price to respond to swings in the Market. A Beta of 1 indicates that a company’s share price will move in line with the Market. A Beta of greater than 1 indicates that a share’s price will be more volatile than the Market. Our Market Proxy is the All Ordinaries Accumulation Index. Dilutive Security: When a company issues additional shares in itself at a price below the current value of existing shares this will have a dilutive effect. Estimated Fully Diluted NTA: Some LICs have additional securities that have the ability to convert to, or create, new ordinary securities in the Company. If a security can be converted to ordinary securities at a price lower than the LIC’s NTA, this will dilute its NTA on a per share basis. Excess Return to Risk Ratio: This ratio, also known as the Sharpe Ratio (see Sharpe Ratio for definition), provides a measure of the return of each portfolio relative to the risk taken by the Investment Manager in achieving that return. A high return is only desirable if it does not come with too much additional risk (volatility of returns - see Standard Deviation). Grossed Up Dividend Yield: Dividends paid plus any franking credits passed on to shareholders. We have focused on this measure to enable valid comparison between LICs whose dividends are franked and those that are not. Growth Investing: Investing in securities with a bias towards higher projected Earnings Per Share growth rates and Return On Equity. Indirect Cost Ratio: The ICR, as defined in the Corporations Act 2001, is the ratio of the Fund’s management costs to average net assets. In layman's terms, it covers all expenditure, excluding transaction and finance costs, in the management of the Fund. This includes management fees, performance fees, marketing, audit, legal, rent, etc.

We are using this method of calculation to standardise the cost ratios across our LIC universe, given many different interpretations of the MER calculations by LICs and the inability to confirm the calculation. ICR is generally accepted as the principal expense ratio calculation for the Managed Funds industry. Net Tangible Assets (NTA): Total assets of the Company minus any intangible assets such as goodwill and trademarks, less all liabilities of the Company. This is calculated before any theoretical tax is payable if the entire portfolio was sold. The largest liability of most LICs is the Management Fee, while some LICs also provide for performance fees, should the LIC’s portfolio achieve certain benchmarks. Management fees are generally a reflection of how actively a portfolio is managed as well as its size. Option Adjusted Portfolio Return: A LIC’s calculated portfolio return over a period may be negatively impacted if there are new securities issued during a period. This is because the Manager will not have been able to generate returns off the new funds over the entire period, which will detract from the performance of the overall portfolio. Accordingly, where new securities have been issued in a LIC we will remove the impact of those securities creating an Option Adjusted Portfolio Return. Passive Management: Investing in an attempt to track the return of the underlying benchmark index. Typically a passively managed portfolio has good diversification, low turnover (good for keeping down internal transaction costs), and lower management fees. Premium/Discount to Pre-Tax NTA: While share prices of LICs are generally based around their NTA, the vagaries of supply and demand, as well as the market perception of a company's outlook, mean that a LIC’s share price may move substantially below (discount) or above (premium) its NTA.









68

LISTED INVESTMENT COMPANIES.

Appendix A: Glossary of terms (continued) Renounceable Rights Issue: This is an offer by the LIC to shareholders to purchase more shares in the Company. Given these rights are normally issued at a discount they have an inherent value that can be traded on the ASX. Stapled Options: These are options that cannot be traded individually. They are attached to a share or similar security and this combined security must be traded in a ‘bundle’. Total Shareholder Return (TSR): Highlights total increase in the value of $100 invested in a LIC over a given period by a shareholder on the assumption that dividends are reinvested. TSR takes into account grossed up dividends paid as well as share price appreciation and may differ from share price performance in this regard. Value Investing: Investing in securities that appear to be undervalued taking in to consideration certain valuation metrics.

69

LISTED INVESTMENT COMPANIES.

70

Appendix B: Legend to Performance Measures The following provides an explanation of each item contained within ‘our performance measures’. Figure - Historical Performance of Pre-Tax NTA and Security Price versus the Benchmark

Performance

3-m th

6-m th

1 year

3 yr p.a.

5 yr p.a.

10 yr p.a.

Performance

3.9%

-6.0%

-14.7%

5.4%

-0.6%

6.9%

Index

1.9%

-9.6%

-11.4%

8.5%

-2.1%

6.3%

Active return

2.0%

3.6%

-3.3%

-3.1%

1.5%

0.6%

Performance

3.4%

-7.8%

-7.8%

9.0%

0.1%

7.4%

Benchmark

2.1%

-9.7%

-10.5%

7.6%

-2.3%

6.2%

Active return

1.3%

1.9%

2.7%

1.4%

2.4%

1.2%

Share price*

NTA+

Performance - The Annualised Compound Total Return calculates the compound yearly return over a period, inclusive of dividends. Dividends are reinvested from the payment date using the most recent historical pre-tax NTA for the NTA performance calculation and the closing price of the security on the prepayment date for the security calculation. Where a LIC has been listed for less than three years each return has been adjusted to reflect the annualised return since its listing. Benchmark - The relevant benchmark has been selected by the Manager. In some instances, the exact Index as selected by a LIC will not be readily available. In such cases, we have determined the most appropriate surrogate index to provide readers with a reasonable guide as to the performance and volatility of that LIC’s benchmark. Active-return - Active Return is the difference between the pre-tax NTA or security price and the underlying benchmark. A positive difference indicates an outperformance versus the benchmark and a negative difference indicates an underperformance relative to the benchmark. Figure - Return and Premium/Discount to pre-tax NTA $250

30%

Prem/Disc (RHS)

Pre-Tax NTA (LHS)

Share Price (LHS)

$200

20%

$150

10%

$100

0%

$50

-10%

$0 2001 -$50

2002

2003

2004

2005

2006

2007

2008

2009

2010

-20% 2011 -30%

Share Price - The light grey line highlights the total increase in the value of $100 invested by that Investment Manager over the time period (assumes dividends reinvested) on a pre-tax basis. Portfolio performance is measured in dollars on the left-hand axis of the Graph. Pre-Tax NTA - The black line provides a total increase in the value of $100 if the investor were able to liquidate the investment at the underlying Pre-Tax NTA over the time period (assumes dividends reinvested). Performance is also referenced to the left-hand axis of the Graph. Premium/Discount to Pre-Tax NTA - The light green columns represent the share price premium/discount relative to month-end pre-tax NTA and is measured as a percentage on the right-hand axis.

LISTED INVESTMENT COMPANIES.

Appendix B: Legend to Performance Measures (continued) Figure 3 - Risk Return Indicators

Risk/Return Indicators Share price*

Information

Sharpe

Standard

Tracking

Ratio

Ratio

Deviation

Error

Year 1

0.18

-0.02

16.4%

15.0%

Year 3

-0.40

-0.62

33.2%

30.2%

Year 5

0.16

-0.18

32.1%

30.5%

NTA+ Year 1

2.21

0.99

11.4%

3.1%

Year 3

-0.60

-0.56

29.2%

7.2%

Year 5

-0.65

-0.33

25.8%

10.1%

Information Ratio - This Ratio is a measure of the risk adjusted return of the LIC. It is defined as the Active Return divided by the Tracking Error. Active Return is the difference between the return of the security and the return of a selected benchmark index. The Tracking Error is the standard deviation of the Active Return. Sharpe Ratio - This Ratio provides a measure of the return of each LIC’s portfolio relative to the risk taken by the Investment Manager in achieving that return. A high return is only desirable if it does not come with too much additional risk (volatility of returns - see Standard Deviation). A Sharpe Ratio is calculated by subtracting a selected Risk Free Rate (Aust. Govt 10-year Bond yield) from a return, and dividing that by the Standard Deviation of that return. Standard Deviation: This is a measure of the dispersion of a portfolio’s returns around its average return. A data set that has many monthly returns a long way from the average return will have a greater standard deviation than a set of monthly returns that are close to the average. In the context of this report, we calculate the average monthly return of each LIC, as represented by changes in its NTA, and from this we can calculate a standard deviation from its average. Theoretically, a LIC that achieves the exact same return every month would have a standard deviation of zero. Tracking Error: This measures how much the return of a portfolio deviates from the return of its benchmark index. A data set that has a low Tracking Error means that its returns are closely tracking the Portfolio’s benchmark. Tracking Error is the standard deviation of the differences between the return of the portfolio and the return of the benchmark.





71

LISTED INVESTMENT COMPANIES.

Appendix C: Disclosures












































WAM Research (WAX): WAX announced an Equity Raising on 28 October 2013. WAM paid a service fee equal to 1.0% (excluding GST) of the Application Monies provided. Bell Potter Securities and its Advisers shared in this Fee. Australian Leaders Fund (ALF): ALF announced an Equity Raising on 24 October 2013. ALF paid a service fee equal to 1.25% (excluding GST) of the Application Monies provided. Bell Potter Securities and its Advisers shared in this Fee. WAM Capital (WAM): WAM announced an Equity Raising on 14 October 2013. WAM paid a stamping fee equal to 1.0% (excluding GST) of the Application Monies provided. Bell Potter Securities and its Advisers shared in this Fee. Watermark Market Neutral Fund (WMK): WMK listed on 18 July 2013. WMK paid a stamping fee equal to 1.0% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Clime Capital (CAM): CAM announced a Renounceable Right Issue on 13 February 2013. CAM paid a stamping fee equal to 1.0% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Cadence Capital (CDM): CDM announced an Equity Raising on 14 January 2013. CDM paid a stamping fee equal to 2.0% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Australian Leaders Fund (ALF): ALF announced an Equity Raising on 19 December 2012. ALF paid a stamping fee equal to 1.0% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Cadence Capital (CDM): CDM announced an Equity Raising on 20 September 2012. CDM paid a stamping fee equal to 2.0% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. WAM Capital (WAM): WAM announced an Equity Raising on 23 July 2012. WAM paid a stamping fee equal to 1.0% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. PM Capital Global Opportunities Fund (PGF): Bell Potter Securities was a Joint Lead Manager of the PM Capital Global Opportunities Fund IPO on 12 December 2013. PGF paid a service fee equal to 1.25% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Platinum Capital (PMC): Bell Potter Securities was a Co-Manager of the Platinum Capital Placement in November 2013 and received a fee for the service. Watermark Market Neutral Fund (WMK): WMK announced a Placement on 24 March 2014. WMK paid a stamping fee equal to 1.0% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Clime Capital (CAM): CAM announced a Placement on 20 March 2014. CAM paid a service fee equal to 1.5% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Future Generation Investment Fund (FGX): FGX paid a service fee equal to 1.82% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. PM Capital Asia (PAF): PAF paid a service fee equal to 1.50% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Acorn Capital Investment Fund (ACQ): Bell Potter Securities was a Joint Lead Manager of the Acorn Capital Investment Fund IPO on 1 May 2014, but did not receive a Corporate Fee for this Service. ACQ paid a service fee equal to 1.5% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Global Value Fund (GVF): GVF paid a service fee equal to 2.50% (excluding GST) of the Application Monies provided with valid Application Forms bearing a Licensee’s stamp to the extent Shares were allotted. Bell Potter Securities and its Advisers shared in this Fee. Magellan Flagship Fund (MFF): Bell Potter Securities was a Co-Manager of the MFF Renounceable Rights issue in May 2015 and received a fee for the service. Argo Global Listed Infrastructure (ALI): Bell Potter Securities was a Co-Lead Manager for this IPO in July 2015 and received a fee for the service.

72