Fat Prophets Global Contrarian Fund Ltd reported a dramatic turnaround with a $9.3 million profit for the half-year ended December 2025, up from just $14,000 a year earlier, alongside a declared interim dividend.
- Revenue jumps to $16.8 million, a 1,653% increase
- Profit after tax rises to $9.3 million from $14,000
- Interim unfranked dividend of 2 cents per share declared
- Portfolio heavily invested in global listed equities (125%)
- Performance fees total $3.23 million for the period
Robust Financial Performance
Fat Prophets Global Contrarian Fund Ltd (ASX: FPC) has delivered a striking financial performance for the half-year ended 31 December 2025, reporting a profit after tax attributable to members of $9.285 million. This marks a remarkable increase from the previous corresponding period’s modest $14,000 profit. Revenue surged to $16.845 million, reflecting a 1,653% rise, underpinned by strong investment income and realised gains.
Investment Portfolio and Strategy
The fund maintains a concentrated portfolio predominantly invested in listed global equity securities, with 125% of its portfolio allocated to equities and 11% held in cash and equivalents. This leveraged positioning suggests an aggressive stance aimed at capitalising on market opportunities. The company’s investment manager, Fat Prophets Funds Management Pty Limited, continues to execute a contrarian strategy focused on long-term capital growth.
Dividend and Shareholder Returns
In line with its improved earnings, Fat Prophets declared an interim unfranked dividend of 2 cents per share, payable on 9 April 2026 to shareholders on record as of 25 March 2026. This dividend announcement signals confidence in the fund’s cash flow and ongoing profitability, providing a tangible return to investors amid a volatile market environment.
Fee Structure and Expenses
The half-year saw management fees of approximately $322,000 and performance fees of $3.23 million, reflecting the fund’s strong relative performance. Performance fees are calculated as 20% of the increase in net portfolio value above previous highs, aligning the manager’s incentives with shareholder returns. Operating expenses remained controlled, supporting the fund’s robust bottom line.
Governance and Compliance
The financial statements were independently reviewed by PKF(NS) Audit & Assurance Limited Partnership, with no issues raised. The directors confirmed the company’s status as a going concern and its ability to meet debts as they fall due. Notably, the company restated prior period figures to reverse a previously recognised tax provision, improving retained earnings by $1.18 million.
Bottom Line?
Fat Prophets’ strong half-year results and dividend declaration set a positive tone, but investors will watch closely for sustainability amid market fluctuations.
Questions in the middle?
- How will the fund manage risk given its leveraged equity exposure?
- What are the prospects for maintaining or growing dividends in the next reporting period?
- How might the performance fee structure impact net returns if market conditions change?