L1 Global Long Short Fund Posts $121 Million Profit and Boosts Dividend Target
L1 Global Long Short Fund (ASX:GLS) reported a striking $121.3 million net profit for FY26 following its strategic reset, declaring a fully franked 2.00 cent final dividend and targeting 8.00 cents per share for FY27.
- FY26 net profit surges to $121.3 million
- Portfolio return of 11.9% outperforms MSCI World Index
- Completed $477 million equity raising, market cap surpasses $1 billion
- Final dividend declared at 2.00 cents fully franked
- Board targets minimum 8.00 cents fully franked dividends for FY27
Transformational Year Following Investment Management Change
L1 Global Long Short Fund Limited (ASX:GLS) has marked its first full financial year under L1 Capital’s stewardship with a dramatic turnaround. The fund posted a net profit after tax of $121.31 million for FY26, up from just $9.70 million the previous year. This leap reflects the successful transition from Platinum Investment Management Limited to L1 Capital Pty Ltd as investment manager on 28 November 2025, which brought a fresh global long-short equities strategy.
The portfolio delivered an 11.9% net return since L1 Capital took over, comfortably beating the MSCI World Accumulation Index’s 10.6% return over the same period. The fund’s approach, characterised by disciplined bottom-up stock selection and active portfolio management, capitalised on market volatility and dislocations, selectively increasing exposure to undervalued, high-conviction businesses across sectors like gold, copper, construction materials, travel, and financials.
Robust Capital Raise and Market Position
FY26 also saw GLS complete a significant equity raising of $477 million through entitlement, shortfall offers, and a placement, which expanded its shareholder base and pushed its market capitalisation beyond $1 billion. This capital injection underpinned the fund’s ability to fully invest its portfolio by January 2026 after liquidating the prior holdings under the old strategy.
Alongside the capital raise, GLS executed an on-market share buy-back program, repurchasing nearly 44 million shares during the year, reflecting management’s discretion to manage capital efficiently in line with market conditions.
Dividend Policy Signals Confidence
Reflecting the strong performance and the reset of the company, the Board declared a fully franked final dividend of 2.00 cents per share for FY26, payable on 23 September 2026. This follows an interim dividend of 1.00 cent per share paid in March 2026, bringing total dividends declared since the management change to 3.0 cents per share.
Looking ahead, the Board has set an ambitious target of at least 8.00 cents per share in fully franked dividends for FY27, to be paid quarterly at 2.00 cents per share. This commitment underscores the Board’s aim to provide shareholders with a sustainable and growing income stream, although each dividend payment remains contingent on Board approval, financial performance, and franking credit availability.
Portfolio Composition and Risk Management
GLS maintains a diversified global long-short portfolio with approximately 40-80 positions primarily in developed markets across North America, Europe, and Hong Kong. The portfolio exhibits a quality value bias, with median long positions trading on roughly 10 times earnings but offering double-digit forward growth and modest debt levels.
The fund’s key contributors in FY26 included stocks like Arizona Sonoran, Accor, BlueScope, CK Hutchison, ArcelorMittal, Piraeus Bank, and Lloyds, while gold equities and some industrials detracted amid a weaker gold price. The investment team leveraged periods of market volatility to adjust exposures dynamically, recycling capital from sectors with strong relative performance such as energy and infrastructure.
GLS’s risk management framework addresses market, credit, liquidity, derivative, and leverage risks, with oversight from an active Audit and Risk Committee. The fund’s use of derivatives, including equity swaps and commodity futures, is integral to its strategy, enabling hedging and efficient portfolio positioning.
Governance and Leadership Refresh
The year also brought significant governance changes. The Board was refreshed in late 2025 with new appointments including Chair Rachel Grimes AM and directors David Gray, Douglas Farrell, and Katrina Glendinning. The company also changed its name from Platinum Capital Limited to L1 Global Long Short Fund Limited, reflecting the strategic reset.
Ernst & Young replaced PricewaterhouseCoopers as auditor in May 2026, and the company maintains a strong focus on compliance, governance, and transparent communication with shareholders.
Dividend Reinvestment Plan Reinstated
GLS’s Dividend Reinvestment Plan (DRP) is operational, allowing shareholders to reinvest dividends into new shares without brokerage costs. The DRP price is set at the average market price over five trading days commencing on the ex-dividend date, with no discount applied. Shareholders wishing to participate in the upcoming dividend must elect by 3 September 2026.
This option complements the Board’s dividend growth strategy and offers investors a tax-efficient way to compound their holdings.
Bottom Line?
L1 Global Long Short Fund’s FY26 results and dividend guidance signal a confident reset, but sustaining outperformance and dividend growth will require navigating ongoing market volatility and execution of its long-short strategy.
Questions in the middle?
- Can L1 Capital sustain its portfolio outperformance amid evolving global macro risks?
- How will the targeted 8.00 cents per share dividend for FY27 impact GLS’s capital allocation and growth prospects?
- What are the potential risks if market volatility intensifies or valuation dislocations narrow?
