Sandon Capital Investments reported a robust 17.1% total shareholder return for the half-year ending December 2025, underpinned by rising dividends and a narrowing discount to net tangible assets. The shift to monthly fully franked dividends signals a strategic focus on steady income for investors.
- 17.1% total shareholder return for six months to December 2025
- 18.7% increase in dividend income to $8.8 million
- Significant reduction in discount to net tangible assets from 16.2% to 5.9%
- Introduction of monthly fully franked dividends starting October 2025
- Strong profit reserves supporting dividend sustainability
Solid Half-Year Performance
Sandon Capital Investments Limited (ASX, SNC) has delivered an impressive 17.1% total shareholder return (TSR) for the six months ending 31 December 2025. This performance was driven by a combination of an 18.7% increase in dividend income, reaching $8.8 million, and a net profit after tax of $4.2 million. Notably, the company’s discount to net tangible assets (NTA) narrowed significantly from 16.2% to 5.9%, reflecting growing investor confidence in SNC’s portfolio and valuation.
Monthly Dividends Enhance Income Stream
In a strategic move to provide shareholders with more frequent income, Sandon Capital introduced monthly fully franked dividends starting October 2025. The company announced a monthly dividend of 0.47 cents per share, equating to an annualised fully franked yield of approximately 6.4%, or 8.5% when including franking credits. This approach aligns with investor demand for steady cash flow and enhances the attractiveness of SNC shares, which currently trade at a modest 3.3% discount to pre-tax NTA.
Portfolio Performance and Market Context
The investment manager’s commentary highlights a tale of two halves during the period. The first three months saw solid earnings growth across the portfolio, outperforming broader market indices that have experienced earnings declines over recent years. However, the latter half was marked by market volatility driven by concerns over potential interest rate hikes and a surge in speculative 'story stocks'; thematic investments with little earnings history. Sandon Capital notably avoided such speculative bets, focusing instead on companies with proven earnings growth and fundamentals.
Strong Reserves Support Dividend Sustainability
With profit reserves totaling 44.8 cents per share and a franking credit balance of 7.5 cents per share as of January 2026, Sandon Capital is well-positioned to maintain its dividend payments. The company has the capacity to pay fully franked dividends amounting to 22.5 cents per share, equivalent to four years of dividends at the current rate, providing a solid buffer against market uncertainties.
Looking Ahead
As the reporting season unfolds, Sandon Capital plans to provide further updates on portfolio performance and company results in its February NTA report. The company remains confident in its disciplined investment approach amid a market environment that continues to reward earnings quality over speculative narratives.
Bottom Line?
Sandon Capital’s disciplined strategy and steady dividend policy position it well for resilient returns amid market uncertainties.
Questions in the middle?
- How will Sandon Capital navigate potential interest rate hikes in the coming months?
- Will the company maintain its monthly dividend pace if market volatility persists?
- How might Sandon Capital’s portfolio adjust to evolving investor appetite for speculative versus earnings-driven stocks?