14/08/2008 - 14:14

Ozgrowth earnings up despite volatility

14/08/2008 - 14:14

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Despite volatility dogging the markets since its debut on the ASX earlier this year, Perth-based investment company OzGrowth Ltd has posted a net profit of nearly $5 million.

Despite volatility dogging the markets since its debut on the ASX earlier this year, Perth-based investment company Ozgrowth Ltd has posted a net profit of nearly $5 million.

The Euroz Ltd spin-off recorded a net profit of $4.6 million in its first annual report with revenue at $8.1 million and a pre-tax operating profit of $6.5 million.

Directors declared a dividend of 0.2 cents while net assets per share grew from 20c to 20.9c after allowance for the dividend.

Chairman Peter Diamond said he was pleased with the company's performance given market instability.

"The six month period since commencement of the company's investment activity has been a particularly volatile one for global equity markets," Mr Diamond said.

"Our strategy has been to gradually invest in selected equities as value has emerged.

"I am particularly pleased that we have been able to report a level of return well above the level generated from a portfolio consisting solely of cash over the period."

However Mr Diamond conceded that the coming financial year did present challenges for equity market but that could present opportunities to the company.

"Whilst price falls in equity markets have improved relative value, broader concerns for the global economy overshadow the outlook for positive returns," he said.

"However, the volatility that this environment produces can present us with attractive opportunities. The underlying fundamentals of Western Australia remain generally sound and our concentration on companies with some connection to this economy underpins their activity."

"We remain focused on investing in a small number of situations where we have a high conviction in the prospect for attractive medium to long term returns."

Ozgrowth listed in January this year after raising $80 million in its initial public offer.

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