WAM Active Limited delivered a historic 75.5% investment portfolio return in FY2026, driving net profit after tax up 355% to $33.8 million and declaring fully franked dividends totaling 9.4 cents per share.
- Investment portfolio up 75.5% in FY2026
- Net profit after tax surges 355%
- Fully franked dividends total 9.4 cents per share
- Oversubscribed $70.7 million entitlement offer
- Portfolio focused on AI, electrification, and critical minerals
Record-Breaking Investment Performance
WAM Active Limited (ASX:WAA) has delivered its strongest financial year since inception, with its investment portfolio soaring 75.5% in the 12 months to 30 June 2026. This staggering gain dwarfed the S&P/ASX All Ordinaries Accumulation Index’s 5.7% return and the Bloomberg AusBond Bank Bill Index’s 3.9%, outperforming them by nearly 70% and 72% respectively. The portfolio’s surge propelled net profit after tax to $33.8 million, a 355% increase on the prior year’s $7.4 million.
This exceptional performance was achieved while maintaining an average cash weighting of 9.3%, underscoring the investment team’s disciplined, flexible approach to capital allocation. The portfolio’s gains translated into a 51.7% growth in net tangible assets (NTA) before tax, lifting it from $0.86 to $1.15 per share.
Generous Fully Franked Dividends and Strong Shareholder Returns
Reflecting its record earnings, WAM Active declared a fully franked final dividend of 3.2 cents per share and a special fully franked dividend of 2.0 cents per share, payable in November and December 2026. These, combined with interim dividends and prior special dividends, bring the total fully franked dividend for FY2026 to 9.4 cents per share; a yield of 9.0% on the 30 June 2026 share price of $1.045. Including franking credits, the grossed-up dividend yield rises to an impressive 12.9%.
The company’s total shareholder return (TSR), which factors in share price appreciation and dividends including franking credits, reached 44.4% for the year. This was despite the widening of the share price discount to NTA from 7.0% to 9.5%, indicating robust underlying value creation.
Capital Raise Enhances Market Presence and Investment Capacity
In February 2026, WAM Active completed an oversubscribed 2 for 3 pro-rata entitlement offer, raising $70.7 million through a combination of existing shareholder participation and a shortfall placement to professional investors. This capital injection expanded the company’s asset base to $185.3 million and boosted market capitalisation to $155.3 million, improving liquidity and the company’s profile among financial planners and institutional investors.
The freshly raised funds were promptly deployed into market opportunities that contributed to the record investment performance. The larger capital base also positions WAM Active to engage more meaningfully in corporate transactions and capital raisings, a key component of its market-driven investment strategy.
Portfolio Positioned on Structural Growth Themes
Lead Portfolio Manager Oscar Oberg highlighted artificial intelligence (AI), electrification infrastructure, and critical minerals as dominant investment themes underpinning FY2026’s success. High-conviction holdings included Lindian Resources, advancing a rare earths development outside China, and Echo IQ, which benefits from AI-driven hospital productivity improvements. The portfolio also featured key positions in Megaport and Southern Cross Electrical Engineering, companies capitalising on data centre expansion and grid infrastructure growth.
Oberg noted an active rotation away from small industrials towards sectors with stronger growth catalysts, managing cash levels dynamically to exploit market dislocations. The portfolio’s diversification spans materials (40.5%), information technology (20.5%), and industrials (12%), among others, reflecting a balance between growth and risk management.
Robust Governance and Risk Management Framework
WAM Active’s Board, led by Chairman Geoff Wilson AO, maintains a strong governance framework with a focus on risk management, compliance, and shareholder engagement. The company continues to disclose material risks including market volatility, concentration risk, and operational risks associated with external service providers and cybersecurity.
The Board also reaffirmed its commitment to paying fully franked dividends, supported by a profits reserve of 25 cents per share and ongoing generation of franking credits through tax payments on realised profits.
Ongoing Advocacy and Philanthropy
Beyond financial results, WAM Active and its investment manager, Wilson Asset Management, continue advocacy efforts against proposed tax reforms affecting unrealised gains and capital gains tax, citing potential adverse impacts on innovation and investment. The company also supports philanthropic initiatives, including Future Generation Australia and Future Generation Women, which combine investment returns with social impact.
With a record FY2026 behind it and a flexible mandate, WAM Active enters FY2027 optimistic but mindful of market volatility and evolving economic conditions.
Bottom Line?
WAM Active’s record FY2026 performance and capital raise set a high bar, but sustaining such momentum amid market shifts will test its nimble, theme-driven strategy.
Questions in the middle?
- How will WAM Active navigate potential volatility in AI and critical minerals sectors?
- What impact will ongoing tax reforms have on the company’s ability to generate franking credits?
- Can the company maintain its dividend yield if market conditions tighten or investment opportunities wane?