Cadence Capital Limited · ASX:CDM
Cadence Capital — Shareholder Meeting (November 2009)
12 slides from Cadence Capital's shareholder meeting presentation, Nov 19, 2009
Slide 1: AGM 19th November 2009
For personal use only AGM 19th November 2009 10.00 – 11.00 am History House
Slide 2: All Ordinaries Index
All Ordinaries Index For personal use only Î The market has now risen more than 50% since it reached a low point in March 2009. Î We are approximately half way between the ‘point point of maximum optimism’ and the ‘point of maximum pessimism’ in the last seven years Page 2
Slide 3: October 2005 - Now
October 2005 - Now For personal use only Î The All Ordinaries Accumulation Index is 24% below its high and 20% higher than when we commenced our fund in October 2005 Î The market falls during g the time pperiod 2005 to 2009 are amongst g the worst experienced since the Great Crash of 1929 Î Recent p
Slide 4: Fund Performance
Fund Performance For personal use only Performance to 31st October 2009 CDM All Ords Outperformance 1 Month -0.10% -1.89% 1YYear 39 97% 22.41% 39.97% 22 41% +17 56% +17.56% Annualised return since inception (49 months) 16.23% 4.58% +11.65% Inception to date accumulated return (49 months) 84.79% 20.0
Slide 5: Exposure Summary
Exposure Summary For personal use only 160% 140% 120% 100% 80% 60% Long Exposure Short Exposure 40% Net Exposure p 20% 0% -20% -40% -60% Î In the past 12 months net long exposure has ranged from 24% to 123% Î In the past 12 months gross exposure has ranged from 41% to 129% Î In the past 12 months sh
Slide 6: Fundamental Analysis
For personal use only Fundamental Analysis Templates Long positions Short positions ’08 ‘09 ’10 ’08 ‘09 ’10 EPS Growth 20 16.5 22 EPS Growth 10 5 5 PE 10 11 11 PE 20 15 15 PEG 2 1.5 2 PEG 0.5 0.3 0.3 OCF yield 12-15 % OCF yield -ve % to 8 % FCF yield 8% -10% FCF yield -ve % to 3% C h Cash Y Yes Cash
Slide 7: Technical analysis
Technical analysis For personal use only Do not short Do not buy Entering Longs Entering Shorts 1% 2% 3% 4% 4% 3% 2% 1% Î the short-term (one year) share price and share volume indicators (short term trend) Î the long-term (five year) share price and share volume indicators (long term trend) Î the a
Slide 8: Fundamental and technical analysis combined
For personal use only We believe that the use of both fundamental and technical analysis has a greater probability of producing superior returns than using either form of analysis in isolation Page 8
Slide 9: It's happening all over again
For personal use only It happening Its h i all ll over again i 2003 003 2009 Î RKN cost 12c with 15c of cash Î RHG 62c with 85c of NTA (mostly cash) Now $ 1 1.79 79 Î CUS in excess of 10% OCF Î MLB cost 33c with 36c of cash yield with no capital expenditure Now $ 1.74 Î HSKG notes: 34% annualised Î
Slide 10: Lessons Learnt this Year
For personal use only L Lessons Learnt L t this thi Year Y Î Fundamental information comes out longg after the market has crashed and markets often predict recovery before analysts ‘revise’ the fundamentals Î Strict risk measures and exposure measures can be more important than fundamental analysis
Slide 11: The Current situation
The Current situation For personal use only Some of the Issues: Î The recapitalisation p of the large g cap p stocks we saw last yyear is now occurring in the middle and smaller cap stocks Î Bank debt and access to capital, whilst improving, is still problematic especially for the smaller companies
Slide 12: Outlook and Questions
Outlook and Questions For personal use only Î Last year we wrote ‘there is likely to be a great deal of uncertainty in the near term, term leading to continued high levels of volatility. volatility In this environment valuations can reach extreme levels and opportunities pp will emerge g in this env
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