NAV on 2019/01/18
|NAV on 2019/01/17
|52 week high on 2018/01/23
|52 week low on 2018/10/30
|Total Expense Ratio on 2018/09/30
|Total Expense Ratio (performance fee) on 2018/09/30
Old Mutual Unit Trust Managers (RF) (Pty) Ltd.
The fund aims to outperform the ASISA category average
Brian joined Old Mutual in 1998 and moved to Old Mutual Equities in 2012. In addition to his role as portfolio manager, Brian is the assigned analyst of many companies within the consumer and industrial sectors. Before joining Old Mutual Equities, Brian headed up Old Mutual Investment Group's Equity Research Unit, where he had oversight of a team of specialist equity portfolio managers and analysts. Brian has 19 years of industry experience.
Brian is currently the portfolio manager of the Old Mutual Industrial Fund, an SA based mutual fund. He is also an analyst for the industrial sector.
Old Mutual Industrial comment - Sept 18
The FTSE/JSE All Share Index retraced some of the gains made in the second quarter by posting a -3.3% return in the third quarter of 2018. During this period, the rand weakened from R13.71 against the US dollar to R14.15/US$. The FTSE/JSE All Share Industrials Index (J257) was particularly weak, posting a -8.4% return. A big influence on the indices in this quarter was heavyweight Naspers, which moving down 12.4% from R3 485 to R3 051 a share. Last quarter we reported on the fact that many shares exposed to SA Inc. saw their share prices move lower off the back of a reversal in sentiment towards shares exposed to the SA economy. This quarter, many of those companies reported results to the end of June 2018. Almost without exception, these results confirmed that the positive sentiment earlier in the year did not translate into any real earnings boost. Our interactions with management, customers and suppliers would suggest that growth will be hard to come by for the year ahead.
During this quarter we attended the Anheuser-Busch Inbev (ABI) Capital Markets event in Johannesburg. This event is hosted in a different city every third year and attended by around 200 global investors. The conference was hosted very soon after the FIFA World Cup Football tournament, so one of the themes that they communicated was how they used this worldwide event as an opportunity to launch Budweiser (one of their global brands) on an international scale. While we are excited about the investment case for ABI in the longer term, over the short term the weakness in emerging market currencies (where they earn a lot of their revenue), combined with a lot of euro-denominated debt, will dampen earnings growth. The Old Mutual Industrial Fund has relatively small exposure to ABI, at 2.5% of the fund’s portfolio, but we will be closely monitoring the share price, currencies, company results and the global growth environment for an opportunity to increase the fund’s exposure to this market leader.
Based on our earnings estimates, the fund is trading on a forward price-earnings (PE) ratio of 14.6 times and a forward dividend yield of 2.6%. The PE of the Industrials Index has decreased over the last quarter, but continues to trade at higher levels than the long-term average of 19.8 times historic earnings.
The fund aims to offer superior returns over the medium to longer term. It achieves this by selectively investing in a focused portfolio of listed industrial companies. The fund aims to achieve its performance objective through well researched and superior share selection.
The fund is for investors wishing to diversify their portfolio to include a specialist fund and who believe the consumer sector offers strong growth opportunities.
This is an aggressive risk fund (risk rating 5). With its exclusive exposure to the consumer sector, it may be more volatile than a fully diversified general equity portfolio. The fund is exposed to share price movements, which are affected by the performance of individual companies, general market conditions as well as political and economic changes. In addition, this fund may hold a greater risk as exposure limits to a single security may be higher. Risk is minimised through a diversified portfolio of shares. Poor performance of one share may be offset by stronger performance of other shares.