Diversified United Investment Posts 5.4% Profit Rise, Zero Debt, and Stable Dividends

Solid Financial Performance Amid Market Volatility

Diversified United Investment Limited (DUI) has released its audited results for the year ended 30 June 2025, reporting a statutory profit after tax of $38.0 million, up 5.4% from the previous year. This modest profit growth comes despite a slight 0.4% increase in revenue to $46.7 million, reflecting the company’s steady income generation from its diversified investment portfolio.

The company’s earnings per share (EPS) also improved, rising 6.0% to 17.6 cents, signaling enhanced profitability on a per-share basis. Excluding special income items such as fair value movements on unlisted managed funds and special dividends, EPS rose by a more moderate 3.1% to 16.5 cents, underscoring the underlying strength of the core portfolio.

Balance Sheet Strengthened by Debt Reduction and Asset Growth

DUI’s balance sheet shows marked improvement, with the Pre-tax Net Tangible Asset (NTA) backing increasing to $6.40 per share from $5.83 in 2024. This growth reflects both market appreciation and the company’s disciplined capital management. Notably, DUI has fully repaid its borrowings by year-end, reducing drawn debt from $77.5 million to nil and significantly lowering interest expenses.

The company’s conservative approach to leverage is evident in its net debt ratio dropping to zero, compared to 4.9% the previous year. This deleveraging enhances financial flexibility and reduces exposure to interest rate fluctuations, a prudent move given the uncertain economic outlook.

Dividend Stability and Shareholder Returns

Maintaining its long-standing commitment to shareholders, DUI declared a final fully franked dividend of 9.0 cents per share, unchanged from the prior year. Combined with the interim dividend of 7.0 cents, total dividends for the year remain at 16.0 cents per share, fully franked at 30%. The company’s Dividend Reinvestment Plan (DRP) continues to offer shareholders the option to reinvest dividends at market prices without discount.

DUI’s consistent dividend policy reflects confidence in its income-generating portfolio, which remains heavily weighted towards Australian equities (77.1%) and international equities (20.4%). The portfolio turnover was modest at 10.5%, with key acquisitions including Challenger Ltd and APA Group, while positions in BHP and Commonwealth Bank were partially or fully reduced.

Outlook – Cautious but Stable

Looking ahead, DUI’s directors express a cautious stance amid ongoing market volatility and geopolitical uncertainties. While the Australian economy is expected to remain resilient with low growth and modest inflation, international trade tensions and tariff uncertainties cloud the global outlook. The company foresees little change in its portfolio composition and expects to maintain dividend levels, although net income may be slightly lower due to reduced dividends from major resource companies.

Overall, DUI’s FY2025 results demonstrate disciplined portfolio management, strong capital position, and a commitment to steady shareholder returns despite a challenging environment.