WAM Active (ASX: WAA) has easily outperformed the Bloomberg AusBond Bank Bill Index and the S&P/ASX All Ordinaries Accumulation Index for the six months to 31 December.

The strong absolute performance saw an increase of 17.5% during the period and 32.5% for the 12 months to year-end, outstripping Bloomberg by 28% for the year and the All Ordinaries by 21.1%.

WAM Active has achieved an annualised investment portfolio return of 10.8% since its inception in 2008.

Financial metrics

The results contributed to a 34.9% increase in WAM’s operating profit before tax to $7.6 million, compared to $5.6m for the previous corresponding period.

Operating profit after tax increased 33.2% from $4m to $5.4m.

Directors declared a fully franked interim dividend of 3 cents per share, representing an annualised fully-franked dividend yield of 6.8%, or 9.7% including the value of franking credits at a 30% tax rate.

Flexible mandate

WAM lead portfolio manager Oscar Oberg said the results had been in line with expectations.

“Our flexible cash mandate and active investment process enable our team to navigate a wide range of market conditions, regardless of the economic environment,” he said.

With an interest rate cutting cycle expected by mid-year, Mr Oberg said the company foresaw increased capital markets activity, creating opportunities to pursue accretive acquisitions and capital management strategies, including initial public offerings.

Active trading style

WAM Active provides investors with exposure to an active trading style aimed at achieving a sound return with low correlation to traditional markets.

The company aims to deliver a regular income stream through the use of fully franked dividends and to provide a positive return with low volatility to preserve capital.

The fund has paid 98.7 cents per share in fully franked dividends to shareholders since its inception, which equates to $1.41 per share when including the value of franking credits.