Excelsior’s Profit Collapse Raises Questions on Future Dividend Sustainability
Excelsior Capital reported a sharp fall in net profit after tax for FY25 despite a 74% rise in investment income, reflecting the absence of last year’s one-off asset sale gain. The company declared a higher fully franked final dividend, signalling confidence in its portfolio.
- Investment income up 74% to $5.9 million in FY25
- Statutory net profit after tax down sharply to $1.0 million
- FY24 included a $47.2 million gain from sale of CMI Operations
- Investment portfolio value increased to $46.2 million
- Final fully franked dividend raised to 4.0 cents per share
Context Behind the Numbers
Excelsior Capital Limited (ASX – ECL) has released its audited financial results for the full year ended 30 June 2025, revealing a mixed performance shaped largely by the absence of a significant one-off gain recorded in the prior year. While the company’s investment income surged by 74% to $5.9 million, statutory net profit after tax (NPAT) plunged to $1.0 million from $50.4 million in FY24. This stark contrast is primarily due to the prior year’s $47.2 million gain on the sale of CMI Operations Pty Ltd, a transaction that no longer influences the current year’s results.
Investment Portfolio and Income Growth
Excelsior’s core business as a listed investment company is reflected in its continuing investment activities. The portfolio’s value rose by $16 million to $46.2 million by the end of FY25, signaling ongoing asset growth and active management. Investment income, which includes interest, fund distributions, and fair value gains, climbed to $5.8 million, underscoring the company’s ability to generate recurring returns despite the absence of asset sales.
Profit and Dividend Dynamics
The net profit before tax for FY25 stood at $1.4 million, a significant drop from $49.3 million in FY24, again reflecting the prior year’s exceptional sale proceeds. Earnings per share fell dramatically to 0.035 cents from 173.89 cents, a figure heavily skewed by the previous year’s one-off event. Despite this, the board has declared a fully franked final dividend of 4.0 cents per share, up from 3.5 cents last year, bringing the total dividend for FY25 to 8 cents per share. This move suggests confidence in the company’s ongoing cash flow and investment strategy.
Looking Ahead
Excelsior’s net tangible assets (NTA) per share remain robust at approximately $3.90, providing a solid base for shareholder value. The company’s focus now appears to be on leveraging its growing investment portfolio to deliver steady income streams and dividends. Investors will be watching closely to see if this strategy translates into improved profitability in the absence of further large asset disposals.
Bottom Line?
Excelsior’s FY25 results mark a transition from one-off gains to steady investment income, setting the stage for a test of its portfolio’s resilience.
Questions in the middle?
- Can Excelsior sustain its investment income growth without further asset sales?
- What sectors or asset classes are driving the portfolio’s recent $16 million increase?
- Will the company maintain or increase dividends amid lower net profits?
