Acorn Capital Investment Fund Posts $9.67M Profit, 15.1% Return in FY25
Acorn Capital Investment Fund Limited reported a robust FY25 with a $9.67 million profit after tax, a significant leap from $1.77 million the prior year, while delivering a 15.1% portfolio return that outperformed its benchmark.
- Profit after tax jumps to $9.67 million, up 420% year-on-year
- Portfolio return of 15.1% beats S&P/Small Ordinaries Accumulation Index at 12.3%
- Final dividend declared at 2.75 cents per share, partially franked
- Net tangible asset backing per share rises to $1.1113 post-tax
- Portfolio includes 77 stocks with 21.1% in unlisted microcap investments
Strong Financial Performance and Dividend
Acorn Capital Investment Fund Limited (ASX – ACQ) has delivered a standout financial year ending 30 June 2025, reporting a profit after tax of $9.67 million, a remarkable increase from $1.77 million in the previous year. This surge reflects the fund's effective investment strategy and market positioning.
The company declared a final dividend of 2.75 cents per share, partially franked at 50%, maintaining a consistent dividend policy with the interim dividend also at 2.75 cents. The Dividend Reinvestment Plan (DRP) remains active, offering shareholders an option to reinvest dividends, which saw $565,290 reinvested during the year.
Portfolio Outperformance and Composition
ACQ’s portfolio returned 15.1% for FY25, outperforming the S&P/ASX Small Ordinaries Accumulation Index’s 12.3% return. This outperformance was primarily driven by strong stock selection in the Industrials (excluding Capital Goods), Materials (Resources), and Communication Services sectors. However, some sectors such as Financials (excluding AREITs), Industrials (Capital Goods), and Health Care had marginal negative contributions.
The fund’s portfolio is diversified across 77 stocks, including both listed and unlisted microcap companies, with unlisted investments comprising approximately 21.1% of gross portfolio assets. This allocation to unlisted securities remains a distinctive feature of ACQ’s investment approach, aiming to capture long-term capital appreciation opportunities beyond the listed market.
Net Tangible Asset Growth and Governance
Net tangible asset (NTA) backing per share increased to $1.1113 post-tax, up from $1.0587 in the prior year, reflecting the fund’s capital growth and effective management of its portfolio. The company holds $30.1 million in reserves to support future dividend payments, underscoring its commitment to delivering income alongside capital growth.
Governance remains robust with recent board changes including the appointment of Clark Morgan and Maureen Baker, both bringing extensive financial services experience. The Audit Committee continues to oversee financial reporting integrity and risk management, supported by external audits from Ernst & Young, which provided an unqualified opinion on the FY25 financial statements.
Outlook and Risk Considerations
While ACQ’s disciplined investment strategy has yielded strong returns, the company cautions that future performance is subject to market conditions and inherent investment risks. The valuation of unlisted investments involves significant judgment and may introduce volatility. The fund’s diversified approach and active management aim to mitigate these risks, but investors should remain mindful of market uncertainties.
Bottom Line?
Acorn Capital’s FY25 results highlight strong growth and resilience, but investors should watch how unlisted assets and market shifts shape future returns.
Questions in the middle?
- How will ACQ’s unlisted investments perform amid changing market conditions?
- What impact will sector rotations have on ACQ’s portfolio in FY26?
- Will the Dividend Reinvestment Plan attract increased shareholder participation?
