Mirrabooka Investments reported a 93.6% jump in half-year profit to $8.9 million, maintaining its fully franked dividend despite portfolio returns trailing the small and mid-cap benchmark.
- Half-year profit rises 93.6% to $8.9 million
- Interim fully franked dividend held at 4.5 cents per share
- Portfolio return of 1.3% underperforms 14.3% benchmark
- Strong cash position following May 2025 rights issue
- Notable share price weakness in key holdings and Corporate Travel suspension
Mirrabooka’s Financial Performance
Mirrabooka Investments Limited has reported a significant increase in its half-year profit for the period ending 31 December 2025, with net profit soaring 93.6% to $8.9 million compared to $4.6 million in the prior corresponding period. This improvement was driven by higher revenue from operating activities, which rose 42.9% to $8.9 million, boosted by gains in the options and trading portfolios as well as increased interest income following a rights issue in May 2025.
Despite this profit growth, Mirrabooka’s portfolio return including franking credits was a modest 1.3% for the half-year, substantially lagging the combined Small Ordinaries and Mid Cap 50 benchmark return of 14.3%. Over the 12 months, the portfolio returned 1.2% versus the benchmark’s 22.5%, reflecting challenges in several core holdings.
Dividend and Shareholder Returns
The company declared an interim dividend of 4.5 cents per share, fully franked at 30%, maintaining the same payout as the previous year. Notably, the entire dividend is sourced from capital gains, with a pre-tax attributable gain of 6.43 cents per share, allowing some shareholders to claim tax deductions. Shareholders have the option to participate in a Dividend Reinvestment Plan and a Dividend Substitution Share Plan, both priced at nil discount to the volume weighted average share price.
Portfolio Composition and Market Context
Mirrabooka’s investment focus remains on small and mid-cap industrial stocks, deliberately avoiding heavy exposure to resource sectors which have seen extraordinary returns; up to 104.3% in mid-cap resources and 73.0% in small-cap resources over the year. The company’s largest holdings include Macquarie Technology Group and ARB Corporation, both of which experienced share price declines around 20% during the calendar year but remain core positions due to their long-term prospects.
Other portfolio challenges included share price weakness in companies such as IDP Education, James Hardie Industries, and Equity Trustees, alongside a write-down of Corporate Travel following its trading suspension due to accounting irregularities. While the holding in Corporate Travel was small, the incident has prompted a review of investment decision processes.
Outlook and Strategic Positioning
Looking ahead, Mirrabooka’s management remains cautiously optimistic. The company’s strong cash position post-rights issue and the availability of attractive valuations within its investment universe provide a foundation for pursuing value-adding opportunities in 2026. The firm acknowledges the cyclicality of the market, especially the resource sector’s influence on benchmarks, and continues to prioritise long-term growth and income through a diversified portfolio of quality small and mid-cap companies.
Mirrabooka will provide further insights into its half-year results during a shareholder webcast scheduled for 3 February 2026.
Bottom Line?
Mirrabooka’s profit surge contrasts with portfolio underperformance, setting the stage for a pivotal year of strategic investment decisions.
Questions in the middle?
- How will Mirrabooka adjust its portfolio strategy in response to resource sector volatility?
- What impact will the Corporate Travel suspension have on governance and risk controls?
- Can the company leverage its strong cash position to outperform benchmarks in 2026?