WAM Income Maximiser Limited (ASX:WMX) pays fully franked dividends monthly, and its Dividend Reinvestment Plan (DRP) gives shareholders the option of receiving additional shares instead of cash. The DRP operated for the September dividend of 0.65 cents per share, fully franked, with no discount applied.

Latest developments

The listed investment company (LIC) reported results for its first full financial year. For FY26, operating profit before tax was $19.6 million and operating profit after tax was $14.3 million. The investment portfolio increased 19.2% over the 12 months, outperforming its benchmark by 13.4 percentage points. The company paid fully franked dividends of 4.83 cents per share during FY26, equivalent to 6.9 cents per share including the value of franking credits.

The company has also expanded its Capital base. After raising about $148 million through a share purchase plan and Placement in late 2025, WAM Income Maximiser launched a 2-for-5 non-renounceable entitlement offer at $1.62 per share during FY27, alongside a placement. It subsequently reported that it had raised $172.4 million across the entitlement offer, top-up facility, placement and shortfall offer, lifting Assets to about $500 million.

Key numbers

The September dividend of 0.65 cents per share is fully franked at the 30% company tax rate. Monthly dividends have increased in steps since the inaugural payment of 0.20 cents per share in August 2025.

About the company

WAM Income Maximiser listed on the ASX in April 2025 and is managed by Wilson Asset Management, whose Chairman and Chief Investment Officer is Geoff Wilson AO, with Matthew Haupt as Lead Portfolio Manager. It invests in a mix of Australian equities, focused on profitable, cash-generative companies in the S&P/ASX 300, and corporate debt, including hybrids.

Its stated objectives are to deliver a monthly stream of franked dividends, provide capital growth over the medium to long term and preserve capital.

How the DRP works

According to the company's dividend notice lodged with the ASX, the DRP price is the volume-weighted average price (VWAP) of WAM Income Maximiser shares sold on the ASX over the four trading days commencing on the ex-dividend date, and the plan operates without a discount. The DRP price for the September dividend was set in accordance with this methodology and confirmed in an updated dividend notice. Shareholders who do not make an election receive their dividend in cash.

How DRP shares are supplied can vary between dividends. For the September dividend, the notice indicates that the DRP shares will not be a new issue, meaning they are expected to be acquired on market. The latest DRP rules and dividend notice set out the current terms.

Why it matters for income investors

The DRP allows participating shareholders to receive dividends as additional shares rather than cash, with each new parcel eligible for subsequent dividends. Because no discount applies, participants acquire shares at a market-based price. The plan also provides a mechanism for reinvesting small monthly amounts without brokerage.

The company has declared fully franked dividends of 0.66, 0.67 and 0.68 cents per share for October, November and December 2026.

What comes next

The September dividend is scheduled to be paid shortly, with the October, November and December dividends to follow.

Future developments include how the new capital is deployed across equities and credit, portfolio performance relative to the benchmark, and whether monthly dividends continue at or above declared levels. Any change to the dividend or DRP terms would be announced to the ASX. The company's monthly investment updates report NTA and portfolio positioning.

Risks and context

Past dividends are not a forecast. Future dividend increases are not assured and depend on the company's profits and available franking credits.

LIC shares can trade at a discount to NTA. Large capital raisings can dilute holders who do not take up offers, and both Equity and Credit markets can fall, with hybrids and corporate bonds exposed to Interest Rate changes and credit risk. Reinvested dividends remain assessable income, and each DRP parcel establishes a separate cost base for Capital Gains Tax purposes.

Conclusion

WAM Income Maximiser (ASX:WMX) operates a no-discount DRP alongside monthly fully franked dividends that have increased from 0.20 cents to 0.65 cents per share since its first payment. FY26 portfolio returns and an enlarged asset base form part of the company's reported position, while dilution from capital raisings and Market Risk remain relevant considerations.

Key Insights

WAM Income Maximiser (ASX:WMX) reported FY26 operating profit after tax of $14.3 million and portfolio returns of 19.2%, ahead of its benchmark, while paying 4.83 cents per share in fully franked dividends during the year. Its asset base expanded to about $500 million following successive capital raisings.

The DRP operates at no discount, with pricing based on a four-trading-day VWAP from the ex-dividend date, and for the September dividend the shares were not newly issued. Declared dividends for October to December continue the monthly pattern, although future dividends remain subject to profits and franking capacity.