Key Highlights

  • London City Equities (ASX:LCE) shares are unchanged at $0.85 at the time of writing on 17 July 2026, with zero volume traded on the session, reflecting the company's extremely low liquidity profile at a market capitalisation of approximately $26.98 million.
  • The company has reported record FY26 net assets of $29.03 million, up from $24.616 million in FY25, with net assets per share of 91.4 cents — a premium to the current trading price of $0.85.
  • A net gain during the year of $4.965 million reflects the realisation of $5.6 million in capital gains from the final sale of the Fiducian Group shareholding and the receipt of over $8 million from the Excelsior Capital liquidation.
  • The company now holds record liquid funds of $25.151 million in cash and cash equivalents, with the equity portfolio reduced to $3.706 million following the Fiducian exit, representing a significant shift in portfolio composition.

London City Equities Limited (ASX:LCE) presents an unusual profile in the context of 17 July 2026's broader market session: shares are unchanged at $0.85 on zero volume traded, against a backdrop where the S&P/ASX 200 (XJO) is off 0.65%. The company has released preliminary unaudited guidance on its FY26 annual results, which are described by directors as a "very satisfactory year" in which both assets and profits reached record levels. With a market capitalisation of approximately $26.98 million and net assets per share of 91.4 cents — above the current trading price — the results release brings into focus the discount at which the company's shares have historically traded relative to its underlying asset value.

FY26 Financial Highlights: A Record Year by Key Metrics

London City Equities has reported shareholders' equity of $29.03 million at 30 June 2026, up from $24.616 million at 30 June 2025. The net gain during the year was $4.965 million, comprising investment gains of $8.05 million offset by a dividend paid of $782,000 and a Future Income Tax Benefit reduction of $750,000, with $199,000 in new capital raised. On a per-share basis, net assets increased from 78.6 cents to 91.4 cents, a gain of approximately 16.3% over the year. Shares on issue rose marginally from 31.304 million to 31.742 million, reflecting the modest capital raising activity during the period.

Fiducian Group Exit: A 20-Year Investment Concludes

The most significant realisation event in FY26 was the completion of the sale of London City's remaining holding in Fiducian Group, which produced total proceeds across the company's involvement of approximately $21 million. The final October 2025 sale generated a capital gain of $5.6 million. Directors note that the company's involvement in Fiducian began two decades ago, representing a long-duration value-creating investment. The decision to exit was attributed to strong equity market conditions and an "overweight portfolio status," language that suggests the position had grown to represent a concentration risk relative to the company's overall portfolio. Directors describe the experience as confirming the validity of London City's investment criteria.

Excelsior Capital: Liquidation and Recovery

The second major event of the year was the resolution of the Excelsior Capital situation. London City, which held a 9% interest in Excelsior Capital, pursued Federal Court action that resulted in agreement for Excelsior to liquidate and return funds to shareholders. The internally managed liquidation produced two fully franked dividends in March and April, with London City receiving over $8 million. Directors note that they await news on remaining funds, suggesting the process may not yet be fully finalised. The receipt of fully franked dividends is a meaningful consideration for the company's tax position, given the associated franking credits.

Balance Sheet Composition: A Cash-Heavy Portfolio

The FY26 balance sheet reflects the twin effects of the Fiducian exit and the Excelsior recovery. Cash and cash equivalents at 30 June 2026 stand at $25.151 million — described by directors as a record — while the equity investment portfolio has been reduced to $3.706 million from $14.587 million at June 2025. This represents a fundamental shift in the portfolio's character: the company enters FY27 with a predominantly liquid balance sheet, with equities representing less than 15% of total assets compared to approximately 54% a year prior. Other liabilities of $320,000 are the only balance sheet obligation, with the provision for taxation reduced to zero from $2.240 million in FY25, reflecting the utilisation of the Future Income Tax Benefit.

NAV Discount and Liquidity Considerations

At the current trading price of $0.85 and net assets per share of 91.4 cents, London City Equities is trading at a discount of approximately 7% to reported net asset value. This discount is a common feature of listed investment companies and is influenced by factors including the liquidity of the underlying portfolio, management fees, and the general perception of the company's future capital deployment capacity. With the equity portfolio now concentrated and cash holdings at record levels, the question of how the company deploys that capital — and over what timeframe — is likely to be the central variable in any near-term assessment of the discount-to-NAV dynamic.

Conclusion

London City Equities (ASX:LCE) has delivered a record year by the measures it tracks most closely — net assets, net assets per share, and cash holdings — driven by the successful realisation of two long-standing investments in Fiducian Group and Excelsior Capital. The company enters FY27 with a predominantly liquid balance sheet and a modest equity portfolio, positioning it for a period of capital redeployment. The unchanged share price on 17 July 2026 reflects the company's extremely low trading liquidity rather than any negative market reaction. Investors interested in the company are encouraged to review its full-year results once audited and to seek professional financial advice.