Solaris Australian Equity Income Plus Limited Reports Pre-Tax Net Tangible Asset Backing of $1.999 Per Share

Understanding Solaris Australian Equity Income Plus Limited’s Business Model

Solaris Australian Equity Income Plus Limited operates as a listed investment company on the Australian Securities Exchange under the ticker SET. The company is headquartered in Brisbane, Queensland, and is structured to generate income for shareholders through exposure to Australian equities. As an income-focused fund, SET manages a portfolio of stocks selected with the objective of delivering regular dividend income and capital growth to its unitholders. The company’s investment strategy centres on identifying and holding Australian securities that offer attractive income yields while maintaining a diversified exposure across sectors of the domestic market.

The fund is managed by Pinnacle Investment Management, which provides ongoing portfolio management, investment advice, and operational support services. The company’s structure as a listed investment company allows retail and institutional investors to gain exposure to a professionally managed portfolio of Australian equities without the need to construct and maintain such a portfolio individually. By investing in SET, shareholders participate in the income streams generated by the company’s underlying holdings, which typically include dividend-paying stocks and other income-generating securities drawn from the Australian market.

What the Pre-Tax NTA Backing of $1.999 Per Share Represents

The estimated pre-tax Net Tangible Asset backing per share of $1.999 represents the underlying asset value attributable to each share in Solaris Australian Equity Income Plus Limited as at 23 July 2026. This figure is calculated on a daily basis and reflects the net value of the company’s investment portfolio, cash holdings, and other tangible assets, less any liabilities. For equity income funds like SET, the NTA is a critical metric that provides investors with visibility into the fundamental per-share value of their investment, allowing them to assess whether the share price trades at a premium or discount to the underlying asset value.

The pre-tax NTA calculation adjusts for management fees, which are deducted regularly from the fund’s assets, and accounts for estimated movements in operating costs payable and income tax balances. According to the company update, the pre-tax NTA includes tax on realised gains and losses and other earnings, but excludes any provision for tax on unrealised gains and losses. This methodology provides investors with a clearer picture of the tax impact on realised transactions, while the exclusion of provisions for unrealised tax liabilities reflects conservative accounting practice where potential future tax on paper gains is not accrued until those gains are crystallised through sale.

Important Limitations and Caveats Regarding NTA Reporting

The company has clearly noted that the pre-tax NTA figure of $1.999 per share is unaudited and approximate only. This designation is significant for investors, as it indicates that the figure has not been subject to the rigorous verification processes that accompany formal audited financial statements. The unaudited nature of the daily NTA reflects the practical reality that producing a fully audited per-share valuation on a daily basis would be operationally impractical and costly. Instead, the figure represents an estimate based on the valuation methodology employed by the fund manager using available market data and valuation techniques appropriate to the asset types held in the portfolio.

Additionally, the company has explicitly stated that the reported NTA does not include any franking account balance held by the company. Franking credits are an important component of the total investment value for Australian equity investors, as they represent tax paid by companies on dividends distributed to shareholders. The exclusion of the franking account balance from the NTA figure means that investors should separately track the company’s franking position if they wish to understand the full tax-adjusted value of their investment. Furthermore, the NTA calculation excludes any deferred tax asset relating to income tax losses that the company may carry forward. These exclusions are standard practice in NTA reporting for listed investment companies and serve to present a conservative view of asset backing per share.

Portfolio Valuation Methodology and Daily Updates

The NTA calculation for Solaris Australian Equity Income Plus Limited is based on the daily value of the company’s investment portfolio, which comprises holdings of Australian equities and cash balances. Each trading day, the fund manager revalues the portfolio at current market prices, using official exchange closing prices for listed securities. This daily valuation approach ensures that investors have access to up-to-date information about the net asset value of their holdings, enabling them to make informed decisions about buying, selling, or holding their shares in SET. The daily update mechanism also promotes transparency and allows investors to compare the share price to the reported NTA to identify any trading premium or discount.

The portfolio valuation is adjusted for various accruals and liabilities to arrive at the net tangible asset figure. Management fees, which are charged regularly by Pinnacle Investment Management for overseeing the fund, are deducted in the calculation. Estimated movements in operating costs payable are also factored in, recognising that the company incurs ongoing expenses for administration, compliance, regulatory reporting, and other operational matters. The inclusion of movements in income tax balances reflects the fact that the company must provision for tax liabilities arising from investment income and realised capital gains, and these provisions are reflected in the NTA calculation to give investors a more accurate picture of the after-cost, after-tax value available to shareholders.

Distinction Between Pre-Tax and Post-Tax NTA Reporting

The company update specifies that the reported NTA is presented on a pre-tax basis, which has specific technical implications for how investors should interpret the figure. Pre-tax NTA includes provisions for tax on realised gains and losses and other earnings, reflecting the actual tax liability the company has incurred or expects to incur from transactions already completed or income already earned. This approach acknowledges that the company has genuine tax obligations that reduce the assets available to shareholders. However, the pre-tax NTA excludes provisions for tax on unrealised gains and losses, meaning that if the portfolio contains securities that have appreciated in value but have not yet been sold, no tax provision is made for the potential future tax liability that would arise if those securities were sold.

This distinction is important for investors to understand, as it means the pre-tax NTA figure represents a middle ground between a fully pre-tax view (which would ignore all tax considerations) and a fully post-tax view (which would provision for tax on all gains, realised and unrealised). The approach reflects the reality that realised gains represent definite tax liabilities, whereas unrealised gains may never result in tax payments if the securities are held indefinitely or bequeathed to beneficiaries who receive a step-up in cost base at death. Investors seeking to understand the tax-adjusted value of their investment should consider both the pre-tax NTA and the company’s franking account balance, which together provide a more complete picture of the after-tax investment value.

Factors Influencing NTA Movements and Portfolio Performance

The pre-tax NTA per share of $1.999 reflects the combined performance of all securities held within Solaris Australian Equity Income Plus Limited’s portfolio as at the reporting date of 23 July 2026. Movements in the NTA from day to day are driven by multiple factors, including changes in the market prices of the equity holdings, dividend income received and accrued, realised and unrealised gains and losses on securities, management fee deductions, and changes in cash balances. For an equity income fund like SET, the portfolio is typically weighted toward dividend-yielding stocks, which means that regular dividend income forms a significant component of the portfolio’s total return alongside capital appreciation or depreciation of the underlying securities.

The NTA can also be influenced by broader market movements affecting Australian equities. When the Australian equity market strengthens, portfolio holdings generally increase in value, and the NTA per share typically rises. Conversely, during periods of market weakness or economic uncertainty, equity valuations may decline, putting downward pressure on the NTA. The composition of the portfolio and the fund manager’s stock selection decisions also play a material role, as outperformance or underperformance of individual holdings relative to market benchmarks will drive NTA divergence from the broader market indices. Additionally, management decisions such as dividend reinvestment, rebalancing between securities, or adjustments to asset allocation in response to market conditions can affect the NTA trajectory. Investors monitoring SET should recognise that daily NTA figures may fluctuate based on these various drivers, and short-term movements should be viewed in the context of the fund’s longer-term investment objectives and performance track record.

NTA Premium and Discount Analysis for Share Price Evaluation

The reported pre-tax NTA of $1.999 per share provides investors with a benchmark against which to evaluate the share price of SET at any given point. Listed investment companies often trade at a premium to NTA when investor demand is strong and sentiment toward the fund is positive, or at a discount to NTA when demand is weak or sentiment is negative. Comparing the current share price to the latest reported NTA allows investors to identify whether SET is trading above or below its underlying asset value. A significant and persistent premium may suggest that investors are willing to pay extra for the active management, portfolio construction, or franking benefits provided by the fund. Conversely, a discount may indicate an opportunity to purchase assets at below their stated value, though persistent discounts can also reflect concerns about management, performance, or fees.

The NTA-to-share-price analysis is particularly relevant for income-focused funds like SET, where the combination of capital value and income distribution is central to the investment proposition. Some investors may be attracted to a fund trading at a discount to NTA if the discount appears temporary and the fund is generating attractive dividend yields. Others may prefer to invest in funds trading at a modest premium if they believe the manager can generate outperformance sufficient to justify the extra cost. The regular publication of NTA updates, as evidenced by the company’s current update, enables investors to track the fund’s net asset backing over time and assess whether any premium or discount is widening or narrowing, which can signal shifts in investor perception or changes in the underlying portfolio value.

Administrative Details and Authorisation of the Update

The company update regarding the pre-tax NTA per share was authorised by Terence Kwong, who holds the position of Company Secretary at Solaris Australian Equity Income Plus Limited. The update was lodged electronically with the ASX on 24 July 2026, one business day after the NTA calculation date of 23 July 2026. The company is registered with the ABN 21 695 278 810 and maintains its registered office at Level 20, 66 Eagle Street in Brisbane, Queensland. The company can be contacted via email at [email protected] for further information or inquiries regarding the fund and its operations.

The timely release of the NTA update reflects the company’s commitment to transparency and regular communication with investors. By publishing the daily NTA figure, the fund provides investors with frequent reference points for understanding the value of their investment and tracking the performance of the underlying portfolio. This regular reporting practice is common among Australian listed investment companies and mutual funds, as it supports informed investment decision-making and allows the market to efficiently price the shares of the fund based on the latest available asset value data. Investors should note that these updates are provided for information purposes and should be viewed as one component of a broader information set that includes periodic financial reports, performance updates, and other disclosures required by the ASX and relevant financial services laws.

What Investors Should Monitor Going Forward

Investors holding shares in Solaris Australian Equity Income Plus Limited or considering an investment in SET should monitor the regular NTA updates that the company publishes to track the trajectory of the fund’s underlying asset value. Changes in the NTA over time will reflect the combined impact of portfolio performance, dividend receipts, fee deductions, and market movements. Comparing successive NTA figures will provide insight into whether the fund is delivering positive or negative returns and how its performance compares to relevant benchmarks such as the ASX 200 Dividend Yield Index or other Australian equity indices. Additionally, investors should track the share price relative to the NTA to identify whether the fund is trading at an attractive valuation.

Beyond NTA monitoring, investors should remain aware of the fund’s dividend distribution schedule and yield, as income generation is a core objective of the SET investment proposition. Changes in the fund’s dividend policy, management team, or investment strategy may also have implications for future NTA growth and investor returns. The company’s periodic financial reports, annual reports, and any other regulatory announcements will provide additional context for understanding the fund’s performance and prospects. Investors seeking detailed information about the fund’s holdings, performance attribution, or investment strategy should consult the company’s website and published materials, and should seek personalised financial advice from a qualified financial adviser before making investment decisions.