Mirrabooka Investments Ltd · ASX:MIR
Mirrabooka Investments — Shareholder Meeting (October 2016)
29 slides from Mirrabooka Investments's shareholder meeting presentation, Oct 10, 2016
Slide 1: 2016 Annual General Meeting Presentation
10 October 2016 For personal use only The Manager ASX Market Announcements Australian Securities Exchange Exchange Centre Level 4 20 Bridge Street Sydney NSW 2000 Electronic Lodgement Mirrabooka Investments Limited 2016 Annual General Meeting Presentation Dear Sir / Madam The following presentation
Slide 2: Annual General Meeting October 2016
For personal use only ANNUAL GENERAL MEETING OCTOBER 2016
Slide 3: Disclaimer
DISCLAIMER For personal use only Mirrabooka Investments Limited, its related entities and each of their respective directors, officers and agents (together the Disclosers) have prepared the information contained in these materials in good faith. However, no warranty (express or implied) is made as t
Slide 4: Overview of Mirrabooka
For personal use only OVERVIEW OF MIRRABOOKA ANNUAL GENERAL MEETING 2016
Slide 5: Mirrabooka's Investment Approach
MIRRABOOKA’S INVESTMENT APPROACH • Small and Mid Cap listed companies in Australia and NZ. For personal use only • Seek companies with strong industry positions, quality balance sheets and good management – often with some ‘skin in the game’. • Typically do not invest in resources and more speculati
Slide 6: How Risk Is Managed Within the Portfolio
HOW RISK IS MANAGED WITHIN THE PORTFOLIO • Limit financial risk by focusing on balance sheet strength. For personal use only • Invest in some companies with high ownership by those running the business. • Take small starting positions and add in any weakness. • Sell when there is an adverse change f
Slide 7: Full Year Financial Summary – June 2016
FULL YEAR FINANCIAL SUMMARY – 30 JUNE 2016 For personal use only ANNUAL GENERAL MEETING 2016
Slide 8: Earnings Per Share and Dividends Per Share
EARNINGS PER SHARE AND DIVIDENDS PER SHARE For personal use only ANNUAL GENERAL MEETING 2016
Slide 9: Share Price Remains at a High Premium to Net Asset Backing
SHARE PRICE REMAINS AT A HIGH PREMIUM TO NET ASSET BACKING For personal use only ANNUAL GENERAL MEETING 2016
Slide 10: Cumulative Share Price Return Including Franking Credits – 10 Years
CUMULATIVE SHARE PRICE RETURN INCLUDING FRANKING CREDITS* – 10 YEARS TO 30 SEPTEMBER 2016 For personal use only * Assumes the reinvestment of dividends. This chart calculates the benefit of franking credits at the time dividends are paid for both Mirrabooka and the index. In practice there is a timi
Slide 11: Market and the Portfolio
For personal use only MARKET AND THE PORTFOLIO ANNUAL GENERAL MEETING 2016
Slide 12: Small and Mid Cap Sectors Have Had Strong Tail Winds With Valuations Expanding
THE SMALL AND MID CAP SECTORS HAVE HAD VERY STRONG TAIL WINDS WITH VALUATIONS EXPANDING Small Ordinaries Price Earnings Ratio Mid Cap Price Earnings Ratio For personal use only Source: FactSet. Source: FactSet. ANNUAL GENERAL MEETING 2016
Slide 13: Mirrabooka's Investment Universe in Small and Mid Caps Has Performed Strongly
AS A RESULT MIRRABOOKA’S INVESTMENT UNIVERSE IN SMALL AND MID CAPS HAVE PERFORMED STONGLY For personal use only Source: FactSet. ANNUAL GENERAL MEETING 2016
Slide 14: Mirrabooka's Portfolio – Per Annum Returns Including Franking Credits
MIRRABOOKA’S PORTFOLIO – PER ANNUM RETURNS TO 30 SEPTEMBER 2016, INCLUDING FRANKING CREDITS* For personal use only After tax and expenses. Ignores benefits of LIC tax credits. *Assumes an investor can take full advantage of the franking credits. ANNUAL GENERAL MEETING 2016
Slide 15: Not a Significant Investor in Resources – 1 Year
MIRRABOOKA IS NOT A SIGNIFICANT INVESTOR IN RESOURCES. THIS CAN EFFECT PERORMANCE – 1 YEAR For personal use only ANNUAL GENERAL MEETING 2016
Slide 16: Not a Significant Investor in Resources – 10 Years
MIRRABOOKA IS NOT A SIGNIFICANT INVESTOR IN RESOURCES. THIS CAN EFFECT PERORMANCE – 10 YEARS For personal use only ANNUAL GENERAL MEETING 2016
Slide 17: Portfolio at September 2016 (Excluding Cash)
PORTFOLIO AT 30 SEPTEMBER 2016 (EXCLUDING CASH) Diversification of the Portfolio Top 10 Holdings For personal use only – 82 holdings in total Rank Company % of Portfolio 1 Treasury Wine Estates* 4.0% 2 Lifestyle Communities 3.4% 3 Qube Holdings* 3.0% 4 Healthscope 2.8% 5 IRESS 2.7% 6 ALS 2.5% 7 Free
Slide 18: Portfolio at September 2016 (Excluding Cash) continued
PORTFOLIO AT 30 SEPTEMBER 2016 (EXCLUDING CASH) continued Diversification of the Portfolio Next 10 Holdings For personal use only – 82 holdings in total Rank Company % of Portfolio 11 Nufarm 2.2% 12 ARB Corporation 2.2% 13 Seek* 2.1% 14 Challenger* 2.1% 15 ASG Group 2.0% 16 ResMed* 2.0% 17 Reece 1.9
Slide 19: Alignment of Interests Is a Feature of Our Investment Approach
ALIGNMENT OF INTERESTS IS A FEATURE OF OUR INVESTMENT APPROACH Profile of Mirrabooka Portfolio For personal use only ANNUAL GENERAL MEETING 2016
Slide 20: Examples of Companies Where We Are Investing Alongside Business Owners
EXAMPLES OF COMPANIES WHERE WE ARE INVESTING ALONGSIDE THE BUSINESS OWNERS For personal use only ANNUAL GENERAL MEETING 2016
Slide 21: Featured Holdings
FEATURED HOLDINGS What we like: For personal use only • US asset base has capacity for further growth, at high returns. • Management very astute in deploying capital. • Very focused on harder to make products = relatively less competition. ANNUAL GENERAL MEETING 2016
Slide 22: Featured Holdings
FEATURED HOLDINGS What we like: For personal use only • Focusing on crops/markets where they have strongest competitive position. • Further cost reductions to drive profit growth. • Rapidly consolidating industry may throw up opportunities. ANNUAL GENERAL MEETING 2016
Slide 23: Portfolio Activity
PORTFOLIO ACTIVITY New holdings added last year: New holdings added this year: For personal use only ANNUAL GENERAL MEETING 2016
Slide 24: Portfolio Activity – Major Sales
PORTFOLIO ACTIVITY Major sales this financial year: For personal use only • CSG (complete disposal) • Ansell • Pacific Brands (takeover) • Adairs (complete disposal) • Generation Healthcare REIT (complete disposal) • Flight Centre Travel Group (complete disposal) • Silver Chef (complete disposal) •
Slide 25: Number of IPOs a Feature of the Strong Small and Mid Cap Market
A FEATURE OF THE VERY STRONG MARKET IN SMALL AND MID CAPS HAS BEEN THE NUMBER OF IPO’S For personal use only Investment team has met with over 150 IPO’s in the last 5 years. Of these: • participated in 32, • purchased another 7 soon after their listing; and • still hold 22 of these today. ANNUAL GEN
Slide 26: Assessing These IPOs, Our Process Is Working
IN ASSESSING THESE IPO’S WE ARE GENERALLY PLEASED THAT OUR PROCESS IS WORKING For personal use only In the portfolio Did not participate or buy subsequently ANNUAL GENERAL MEETING 2016
Slide 27: Outlook
For personal use only OUTLOOK ANNUAL GENERAL MEETING 2016
Slide 28: Outlook
OUTLOOK • On a positive note the domestic economy is showing some improvement. For personal use only • However, many companies in Mirrabooka's investment universe are trading at high prices. • If valuations become too high we will reduce positions to manage risk. • Given the current pricing for perf
Slide 29: For personal use only
Pa ¢-. % MIRRABOOKA Investments Limited
Mirrabooka Investments — Shareholder Meeting (October 2016) on 6ix