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WCM GLOBAL GROWTH LIMITED — Net Asset Value 2017
Aug 8, 2017
66077_rns_2017-08-08_2381c05a-6560-4928-9cf8-bd45ad549cd1.pdf
Net Asset Value
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CONTANGO GLOBAL GROWTH (CQG)
MONTHLY NTA STATEMENT 31 JULY 2017
Contango Global Growth Limited’s investment objective is to seek quality growth businesses with high returns on invested capital, superior growth prospects and low or no debt. The Portfolio’s Benchmark is the MSCI All Country World Index exAustralia with gross dividends reinvested reported in Australian Dollars and unhedged. The portfolio targets capital growth over dividends.
The Company’s Investment Strategy is to have an actively managed long only global equities Portfolio invested in listed securities of developed and emerging markets, with the exclusion of investments in Australian securities.
The Investment Strategy will take a high conviction, active approach. The Portfolio will be concentrated across 20 – 40 high quality global growth companies. The Portfolio will be further diversified across global sub-sectors and countries, both developed market and emerging market, based upon the rigorous bottom-up analysis undertaken by the Adviser. Up to 7% of the Portfolio Value may be held in cash or cash equivalents from time to time.
| KEY DETAILS | ||
|---|---|---|
| Report Date: | 31 July 2017 | |
| ASX Code: | CQG / CQGO | |
| Listed on ASX: | 23 June 2017 | |
| Fund Manager: | Contango International Management Pty | |
| Limited | ||
| Investment Adviser: | WCM Investment Management | |
| Benchmark: | MSCI All Country World Index ex- | |
| Australia with gross dividends reinvested reported in Australian dollars |
||
| and unhedged | ||
| Number of stocks: | 20 – 40 | |
| Maximum cash | 7% | |
| position: | ||
| Stock universe: | Global (ex-Australia) | |
| Portfolio size: | $93.68 million | |
| Shares on issue: | 90.936 million | |
| Share Price: | $1.115 |
ASSET COMPOSITION
NET TANGIBLE ASSETS
| ASSET COMPOSITION |
JUNE 2017 | JULY 2017 |
|---|---|---|
| Investment Type $m % |
$m % |
|
| Listed shares 87.84 92.0 |
88.76 94.7 |
|
| Liquidity 5.74 6.0 |
2.20 2.4 |
|
Tax asset (liability) 1.93 2.0 |
2.72 2.9 |
|
| Net Assets After Tax $95.51 100.0% |
$93.68 100.0% |
|
| Ordinary Shares on Issue 90.926m |
90.936m | |
| Options on issue 90.926m |
90.916m |
| NET TANGIBLE ASSETS | 30 JUNE 2017 | JULY 2017 |
|---|---|---|
| NTA of investments before tax $1.029 |
$1.000 | |
| NTA of investments before tax on unrealised gains $1.043 |
$1.024 | |
| NTA after tax $1.051 |
$1.030 | |
| Month-end closing share price (CQG.ASX) $1.100 |
$1.115 | |
| Month-end closing option price (CQGO.ASX) $0.033 |
$0.055 |
Contango Global Growth Limited ACN 617 281 268 Phone: +61 3 9222 2333 Address: Level 27, 35 Collins Street, MELBOURNE VIC 3000 E: [email protected] | W: www.contango.com.au
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MONTHLY PORTFOLIO UPDATE
The Contango Global Growth portfolio returned -2.1% for the month of July 2017, underperforming the benchmark index the MSCI All Country World Index ex-Australia that returned -1.2% by 0.9%, reported in Australian dollars and unhedged. Over the month, the Australian dollar appreciated against the USD from USD 0.77 to USD 0.80, detracting 4% from the portfolio’s performance. A strong contributor to performance was the portfolio’s exposure to emerging markets equities (i.e. companies domiciled in countries that includes Argentina, China and India) because emerging markets out performed developed markets (i.e. companies domiciled in countries that includes USA, Japan, Germany, United Kingdom). The global equities portfolio’s exposure to globally listed companies listed in developed markets was 81.5% and 15.8% to emerging markets and 2.7% invested in cash. Over the year major global equity markets have generated strong double digit returns of USA (+13.6%), Germany (+13.4%), France (+15.8%), UK (+9.4%), Japan (+20.8%) and China (+37.3%).
The portfolio continues to have significant investments in growing industry sectors of technology of 25.9%, healthcare of 15.5%, consumer discretionary of 16.6% and nil allocations to low growth sectors of utilities and telecoms. Companies held in these growing sectors have strong qualities wide and growing competitive economic advantages supported by high returns on invested capital, superior growth prospects and low or no debt. These qualities help to protect the company from competition and maintain pricing power in their products, assisting them to continue to generate growing profits across a variety of market conditions. The companies selected for the final portfolio also have strong long term track records of generating profits for shareholders and stable management teams that provide the right cultures to support the business.
The top 5 best stock contributors to performance for the month of July on an absolute basis were: MercadoLibre (+10.5%), provides internet e-commerce trading services in South America. HDFC Bank (+6.9%), provides commercial and international banking services in India. Tencent Holdings (+7.8%), a diversified Chinese e-commerce company providing internet, mobile and telecom services. Facebook (+7.7%), a USA based global social media company. Ctrip (+6.6%), operates an internet travel planning, hotel and air ticket reservations business in China.
The bottom 5 stock detractors to performance for the month of July on an absolute basis were: Atlas Copco (-9.3%), a globally diversified manufacturer of heavy duty industrial equipment based in Sweden. Reckitt Benckiser (-7.7%), a UK
headquartered company that is a leading global manufacturer and marketer of household cleaning, health and personal care products. Boston Scientific (-7.7%), a global developer and seller of medical devices for used to diagnose and treat various medical conditions, based in the USA. Techtronic Industries (-7.0), engages in the manufacture of various electrical power tools under well-known brands of AEG, Homelite, Ryobi and Hoover. Headquartered in Hong Kong. Canadian National Railways (-6.3%), a freight railway company, headquartered in Montreal, that carries railroad freight throughout Canada, the mid-west and southern USA.
PERFORMANCE
| Performance | Contango Global Growth Ltd % MSCI ACWI (ex- Australia)% Value Add % |
|---|---|
| 1 Month -2.1 -1.2 -0.9 |
MARKETS ALLOCATIONS
| Developed & Emerging Markets Allocations |
Contango Global Growth Fund % |
|---|---|
| Developed Markets 81.5 |
|
| Emerging Markets 15.8 |
|
| Cash 2.7 |
REGIONAL ALLOCATIONS
| Developed & Emerging Markets Allocations |
Contango Global Growth Fund % |
|---|---|
| Americas 63.7 |
|
| Europe 17.8 |
|
| Asia/Pacific 15.8 |
|
| Cash 2.7 |
TOP 10 HOLDINGS
| STOCK | Weight (%) |
|---|---|
| Cooper Companies 3.9 |
|
| HDFC Bank 3.7 |
|
| Reckitt Benckiser 3.4 |
|
| Canadian National Railway 3.3 |
|
| Visa Inc 3.2 |
|
| Amphenol 3.2 |
|
| Keyence Corp 3.1 |
|
| Quintiles Transnational Hold 3.1 |
|
| Tencent Holdings Ltd 3.1 |
|
| Boston Scientific Corp 3.0 |
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COUNTRY ALLOCATIONS
| Country | Contango Global Growth Fund % |
|---|---|
| USA 57.8 |
|
| Switzerland 2.7 |
|
| Argentina 2.7 |
|
| United Kingdom 6.2 |
|
| Canada 3.3 |
|
| India 3.7 |
|
| Hong Kong 6.0 |
|
| Taiwan 3.0 |
|
| Japan 3.1 |
|
| Sweden 2.4 |
|
| Denmark 2.4 |
|
| France 1.7 |
|
| Italy 2.3 |
|
| Cash 2.7 |
SECTOR ALLOCATIONS
| Sector | Weight (%) |
|---|---|
| Technology 25.9 |
|
| HealthCare 15.5 |
|
| Consumer Discretionary 16.6 |
|
| Financials 10.5 |
|
| Consumer Staples 8.2 |
|
| Industrials 8.1 |
|
| Materials 5.4 |
|
| Energy 4.3 |
|
| Telecom Services 0.0 |
|
| Real Estate 2.9 |
|
| Utilities 0.0 |
|
| Cash 2.7 |
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DISCLAIMER:
- Gross performance does not reflect the impact from fees, taxes and charges. Past performance is not a predictor of future returns.
DISCLAIMER:
Contango Global Growth Ltd (CQG) has prepared this update for information purposes only related to the underlying investment portfolio. The NTA figures provided in this document are unaudited and approximate. This document does not contain investment recommendations nor provide investment advice. Investors in LICs should understand the distinction between Investment Portfolio Performance, NTA Performance and Share Price return. Neither CQG nor its related entities, directors or officers guarantees the performance of, or the repayment of capital or income invested within CQG or any associated product. Contango International Management Limited ACN 617 319 123 AFSL No. 237119 is the investment manager of CQG. We strongly encourage you to obtain detailed professional advice and to read any relevant offer document in full before making any investment decision. CQG may not be suitable for your investment needs. This is not an offer to invest in any financial product.