Several of Argo’s larger holdings increased dividends by more than 100 per cent, including Macquarie Group, BHP Group, Rio Tinto and National Australia Bank.
“The calendar year return of 22.7 per cent was even more impressive compared to the (ASX200) index return of 17.2 per cent, with Macquarie Group, Sydney Airport and our exposures to battery materials through IGO, Lynas Rare Earths and Novonix providing about half of the outperformance,” the company said in a statement to the ASX yesterday.
“The strong performance relative to the broader Australian share market reflects Argo’s focus on company fundamentals to identify high-quality companies with good long-term prospects.”
Argo’s share price gained 15.7 per cent for the six-month period and was up 25.5 per cent for the year, closing at $10.18 on December 31.
However, it has fallen slightly since, opening at $9.90 ahead of Monday’s announcement.
During the half-year, Argo made $301 million of investments and received $191 million from portfolio sales and takeovers.
It increased its investments in Lendlease Group, CSL and Macquarie Group during the period while the company also bought into RAMS Essential Services Property Fund for the first time.
It fully exited its investments in Crown Resorts, AGL Energy and Boral.
The company said the total number of stocks in its portfolio remained the same.
“A number of new stocks were added to the portfolio over the half-year, while other holdings were removed due to mergers or takeovers, including Oil Search, Spark Infrastructure and Milton Corporation.”
The half-year profit increase follows a 2020-21 financial year profit of $174 million and a full-year dividend of 28 cents perxjmtzyw share, announced in August.
Founded in Adelaide in 1946, Argo Investments is among the ASX’s largest 100 companies and is the third biggest company in South Australia with a market capitalisation of more than $7 billion.
However, the company warned that the ASX200 index had “retreated swiftly in the new year” and was down more than 5 per cent amid increasing volatility, particularly among technology stocks.
“In recent weeks, economic conditions have worsened as surging Omicron cases and isolation requirements created labour shortages, crippled supply chains and renewed fears leading to ‘shadow’ lockdowns,” the company said in its statement to the ASX yesterday.
