WAM Alternative Assets Posts 9.1% FY 2026 Return, Outperforming Index

WAM Alternative Assets, an Australian alternative investment manager, delivered a 9.1% underlying portfolio return for fiscal 2026, marking a notable improvement over recent years and outperforming the All Ordinaries Accumulation Index’s 5.7% gain. Total shareholder return stood at 8.7%, supported by a final dividend of AUD 0.03 per share, bringing the full-year payout to AUD 0.06—a yield of approximately 6% (grossed up to 7.5%). The company traded at an 18% discount to net tangible assets, the widest among Wilson Asset Management’s listed investment companies. Stocks initially dipped 2.48% on earnings day but later rebounded 1.55% to settle at $0.985, within a 52-week range of $0.95 to $1.06. Portfolio risk remained low, with 12-month volatility at 2.7%, compared to over 10% for the broader market index. The firm’s cumulative return since inception in October 2020 approached 8.9%, nearing its 10% target. Contributions to returns included new investments (11.3 pp), legacy asset adjustments (–2.2 pp), income (2.5%), and asset revaluations (6.6%). Private equity exposure grew to 36% (from 26%), with 96% of allocations in Australian-based funds. Water and agriculture assets were reduced to 12.5% and 10%, respectively, while real estate and infrastructure remained stable at ~15%. Private debt rose to 8.4% (target: 10% or less), and cash reserves were streamlined to a low-risk treasury tool yielding 2.9% with daily liquidity. Twenty-four exits were completed at an average 28.3% premium to net tangible assets, with legacy assets now constituting just over 10% of the portfolio. Management emphasized disciplined valuations, noting no exposure to defaults like Bathla’s real estate debt, despite citing Bathla as a case study for credit stress. Dividend coverage remained robust, covering approximately 2.3 years of payouts, with a focus on maintaining fully franked distributions. Portfolio managers highlighted the portfolio’s ability to deliver strong returns with lower volatility, citing exits and strategic reallocations as key drivers of performance.