Cadence Capital Limited · ASX:CDM
Cadence Capital — Investor Presentation (September 2019)
21 slides from Cadence Capital's investor presentation, Sep 10, 2019
Slide 1: Investor Presentations September 2019
Cadence Capital Limited For personal use only Investor Presentations September 2019
Slide 2: Agenda
Agenda For personal use only ▪ At today’s presentation we would like to cover: ▪ the past year’s performance ▪ the largest detractors and top performers ▪ the discount of our CDM share price to NTA ▪ 2019 final dividend ▪ the current portfolio & some of our top positions ▪ CDM as an investment oppor
Slide 3: Full Year Performance
Full Year Performance For personal use only Gross Net Performance Net Performance All Ords Accum Fund Performance - 30 June 2019 Performance Incl. Franking * (after fees) Incl. Franking (before fees) (after fees) 1 Month -4.3% -4.4% -4.3% 3.5% 1 Year -20.6% -21.3% -20.5% 12.5% 3 Years (per annum) 3.
Slide 4: Full Year Performance
Full Year Performance For personal use only ▪ In 2019 the fund delivered one of its worst performances since the company’s inception 13 years ago. ▪ There was significant volatility through the year with a 18% correction in global equities in the December quarter followed by a 21% rally back to prev
Slide 5: Full Year Performance - Detractors
Full Year Performance - Detractors For personal use only ▪ ARQ Group (ASX Code: ARQ) was the largest detractor to fund performance - currently a long investment ▪ Cadence first invested in 2013 pre a capital return and special fully franked dividend. ▪ We added to our position as the stock was trend
Slide 6: Full Year Performance - Detractors
Full Year Performance - Detractors For personal use only ▪ Emeco Holdings (ASX Code: EHL) was the second largest detractor - sold ▪ The stock price declined significantly in the fourth quarter after being one of the top performers in the market over the preceding 18 months. ▪ The EHL position was so
Slide 7: Full Year Performance - Contributors
Full Year Performance - Contributors For personal use only ▪ Bingo Industries (ASX Code: BIN) - currently a long investment ▪ Entered the position in February 2019 after the waste management business posted a downgrade to FY19 earnings guidance. ▪ We saw the imminent ACCC decision relating to the DA
Slide 8: Full Year Performance - Contributors
Full Year Performance - Contributors For personal use only ▪ Stanmore Coal (ASX Code: SMR) - currently a long investment ▪ We initiated a position last year through two sell-downs, whilst the share price was still going up. ▪ Management has done a good job at building shareholder value through incre
Slide 9: CDM Discount and Premium to NTA
CDM Discount and Premium to NTA For personal use only ▪ CDM shares now trade at roughly a 15% to 20% discount to pre-tax NTA. ▪ The 2019 Full year negative performance of the fund has resulted in a fall in NTA. ▪ By far the largest factor affecting the CDM share price over recent years, has been the
Slide 10: CDM Discount and Premium to NTA
CDM Discount and Premium to NTA For personal use only $0.40 $0.30 $0.20 $0.10 $0.00 -$0.10 -$0.20 -$0.30 -$0.40 -$0.50 -$0.60 Pre Tax NTA Post Tax NTA 10
Slide 11: Final Dividend
Final Dividend For personal use only Calendar Year Interim Final Special Total Gross (Inc. Franking) 2007 2.0c 2.0c 2.0c 6.0c 8.6c 2008 2.5c 2.2c* - 4.7c 5.8c 2009 - 2.0c - 2.0c 2.9c 2010 2.0c 2.0c - 4.0c 5.7c 2011 3.0c 3.0c 3.0c 9.0c 12.9c 2012 4.0c 4.0c 4.5c 12.5c 17.8c 2013 5.0c 5.0c 1.0c 11.0c 1
Slide 12: Top Holdings – 30th June 2019
Top 20 Holdings – 30th June 2019 For personal use only Top 20 Holdings Code Position Direction Currency Holding MNY Money3 Corp Ltd Long AUD 5.7% CIA Champion Iron Ltd Long AUD 5.0% MQG Macquarie Group Ltd Long AUD 4.7% STO Santos Ltd Long AUD 4.6% BIN Bingo Industries Ltd Long AUD 4.5% ARQ ARQ Grou
Slide 13: YTD Performance (31st August 2019)
YTD Performance (31st August 2019) For personal use only Gross Performance* to 31st August 2019 CDM All Ords Accum Outperformance 1 Month -0.7% -2.2% 1.5% YTD 1.6% 0.7% 0.9% 1 Year -17.2% 8.6% -25.8% 3 Years (per annum) 1.5% 11.1% -9.6% 5 Years (per annum) 1.4% 8.1% -6.7% 8 Years (per annum) 6.1% 10
Slide 14: Eclipx (ECX)- PM Karl Siegling
Eclipx (ECX)- PM Karl Siegling For personal use only Stock Profile ECX Fundamental Analysis ▪ ECX is one of Australia’s largest car leasing and fleet services businesses. Long Position ▪ After several earnings downgrades, the stock fell to levels EPS Growth 15% representing 4-5x PE, significantly ch
Slide 15: Bingo Industries (BIN) – PM Charlie Gray
Bingo Industries (BIN) – PM Charlie Gray For personal use only Stock Profile BIN Fundamental Analysis ▪ BIN is a waste management business with operations in metro NSW and VIC. Long Position ▪ At our initial purchase price around $1.30 BIN was EPS Growth 22% trading at 11x PE, a very low multiple gi
Slide 16: Alibaba (BABA US) – PM Jackson Aldridge
Alibaba (BABA US) – PM Jackson Aldridge For personal use only Fundamental Analysis Stock Profile BABA ▪ Alibaba Group is a Chinese multinational company specializing in e-commerce, retail, payments, cloud computing and other technologies. Long Position ▪ The company will directly benefit from the gr
Slide 17: Resimac (RMC) – PM Karl Siegling
Resimac (RMC) – PM Karl Siegling For personal use only Fundamental Analysis Stock Profile RMC ▪ In all the banking turmoil nonbanks have started to gain market share off a low base and grow earnings Long Position ▪ Similar to two other nonbank positions in our portfolio ECX and MNY, all growing in n
Slide 18: CDM as an investment
CDM as an investment For personal use only ▪ CDM is trading at a substantial discount to Pre-Tax and Post-Tax NTA. ▪ CDM has a history of paying a strong fully franked dividend yield. ▪ The Company implemented an on-market share buy-back of up to 10% of outstanding shares per annum, which is well ti
Slide 19: Outlook
Outlook For personal use only ▪ Investor sentiment continues to swing between optimism and pessimism. ▪ Central banks continue to play a significant role in financial markets. ▪ The return to cutting interest rates by the Federal Reserve has once again boosted share prices of companies which rely on
Slide 20: Keep up-to-date with Cadence
Keep up-to-date with Cadence For personal use only ▪ Make sure you are registered to receive our monthly newsletter, webcasts and periodic results ▪ To register visit www.cadencecapital.com.au/register-for-FREE-newsletter ▪ Read our articles 20
Slide 21: Disclaimer
Disclaimer For personal use only The information contained in this report has been prepared with all reasonable care by Cadence Asset Management Pty Ltd and is of a general nature only. It is provided for information purposes only and should not be construed as an offer or solicitation. Nothing cont
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