Key Highlights

  • WAM Microcap paid a fully franked final Dividend of 5.35 cents per share on 29 October 2026.
  • The FY26 dividend totalled 10.7 cents per share, fully franked.
  • The Dividend reinvestment plan applied a 2.5% discount.
  • The full-year payment was lifted despite an FY26 operating loss.

WAM Microcap Limited (ASX:WMI) paid a fully franked final dividend of 5.35 cents per share on 29 October 2026, taking its FY26 dividends to 10.7 cents per share, fully franked. The listed investment company announced the higher full-year dividend on 20 August 2026 in the same release that reported an operating loss for the year to 30 June 2026. For readers searching for the best dividend stocks ASX investors talk about, the WAM Microcap case shows how a listed investment company can keep paying dividends in a weak year by drawing on profits built up in earlier periods, and why that differs from a Business paying out of current earnings.

The Final Dividend Timetable and DRP Terms

The final dividend of 5.35 cents per share carried full franking. According to the company's announcement, the shares went ex-dividend on 16 October 2026, the Record Date was 19 October 2026 at 7:00pm Sydney time, the last day to elect into the dividend reinvestment plan was 21 October 2026, and payment was made on 29 October 2026.

The dividend reinvestment plan operated for the final dividend at a 2.5% discount. The issue price was set using the Volume weighted average price over the four trading days starting on the ex-dividend date, with any fractional entitlements rounded down. Shareholders who did not elect into the plan received cash.

The full-year figure of 10.7 cents means the interim and final dividends were each 5.35 cents per share. The company also reported that it has paid 80.7 cents per share in fully franked dividends since it listed, or 115.3 cents per share once franking credits are included.

Paying a Dividend in a Loss-Making Year

The more unusual part of the FY26 result is that the dividend increase came alongside an operating loss. WAM Microcap reported an operating loss before tax of $2.4 million and an operating loss after tax of $0.1 million for the 12 months to 30 June 2026. The investment portfolio returned 0.1% for the year before fees, expenses and taxes, compared with 8.1% for the S&P/ASX Small Ordinaries Accumulation Index.

A listed investment company's accounting profit is largely the result of gains and losses on its portfolio, which move from year to year with markets. To smooth dividends, companies of this type transfer profits into a profits reserve in good years and pay dividends from that reserve over time. The company's announcement referred to its profits reserve as the source that supports dividends, although it did not state the reserve balance in cents per share or the number of years of dividends it covers.

The key point is that a dividend paid during a loss-making year is not covered by that year's earnings. It is funded from past profits held in reserve. That approach can support steady payments, but the reserve is finite, and its size relative to the dividend rate becomes more important after a weak year.

Longer-Term Portfolio Performance Context

Over longer periods the portfolio's reported performance has been ahead of its benchmark. The company reported annualised portfolio performance of 13.0% over three years, 7.0% over five years and 13.4% over seven years, against 9.9%, 3.0% and 5.5% for the S&P/ASX Small Ordinaries Accumulation Index. Since inception, the portfolio has returned 14.4% a year compared with 7.0% for the index. All figures are before fees, expenses and taxes.

Those multi-year gains are what built the reserve now supporting dividends. The single weak year in FY26 did not remove the company's capacity to pay, but it did mean that FY26 itself added little to the pool available for future dividends.

How Franking Works on the 5.35c Final

Because the final dividend was fully franked at the 30% corporate tax rate, each 5.35 cents of Cash Dividend came with a franking Credit of about 2.29 cents. That gives a grossed-up value of roughly 7.64 cents per share. On the full-year dividend of 10.7 cents, the grossed-up value is about 15.29 cents per share.

Franking credits represent company tax already paid. Australian resident shareholders include the grossed-up amount in Taxable Income and then claim the credit as an offset against their tax. The value of that offset depends on each shareholder's own tax position, which is why the company presents figures both with and without franking credits.

For a listed investment company, the ability to frank dividends depends on the tax it pays on realised gains and income. A company can only attach franking credits it has accumulated, so franking capacity and the profits reserve both matter when assessing whether a fully Franked Dividend can continue.

Dividend Objective and the People Behind It

WAM Microcap's stated objectives are to deliver a stream of fully franked dividends, provide Capital growth over the medium to long term, and preserve capital. Chairman and Chief Investment Officer Geoff Wilson AO said in the announcement that the Board aims to keep paying fully franked dividends through market cycles. The company did not set out a formal payout ratio.

The portfolio is managed by Wilson Asset Management, with Oscar Oberg as Lead Portfolio Manager and Catriona Burns as Chief Executive Officer. The company invests in small and micro-cap companies listed on the ASX, a segment where portfolio results can swing more sharply from year to year than across the broader market.

The next dividend announcement from WAM Microcap is expected with its half-year result for the six months to 31 December 2026. That release will show how the portfolio has performed since June and what the profits reserve looks like after the 5.35 cent final dividend.

Key Takeaways

WAM Microcap paid a fully franked final dividend of 5.35 cents per share on 29 October 2026, after an ex-dividend date of 16 October and a record date of 19 October. The full-year FY26 dividend was 10.7 cents per share, fully franked, and the dividend reinvestment plan applied a 2.5% discount.

The dividend increase came in a year when the company reported a small operating loss and a portfolio return of 0.1%. The payment was supported by the company's profits reserve rather than FY26 earnings, which is the main feature to understand when looking at dividend consistency at a listed investment company. The half-year result due for the period to 31 December 2026 will provide the next update on both portfolio performance and dividend capacity.