KFL – March 2017 monthly update

A word from the Manager — Meeting expectations
Actress Pamela Anderson famously said “It’s great to be a
blonde. With low expectations it’s very easy to surprise people”.
I can attest to the fact that brunettes rarely get away with low
expectations; neither do redheads or chief executives of listed
companies (most of whom are grey haired these days).
At this time of the year, managing expectations is what it’s
all about for listed companies, and it is always with a little
trepidation that we await the profit reporting season. Have
our companies done what they said they’d do? Have they
communicated openly to the investment community in the past
six months to manage expectations and guide profit forecasts to
within cooee of actual results? And are their outlook statements
positive enough to prompt analysts to raise expectations for the
next round of profit results?
Unfortunately, the job of chief executives has become even harder
in recent times because a) analysts remain fixated on the bottom
line of company results even though earnings often tell only a
partial story and b) reactions are often outsized compared to
results, such as a 2% profit “miss” against forecasts resulting in a
10% plus share price fall.
It’s fair to say that our expectations of our portfolio companies
have not been dashed so far in the first two months of the year,
but neither have we been blown away by companies over-
delivering. We fared well through the recent profit result round
and have enjoyed exploiting opportunities when the market either
had the wrong expectations or reacted inappropriately to what
were actually good results.
Managing expectations is a year-round job for politicians and
central bankers. Talk of what we might expect from President
Trump and, to a lesser extent, the Federal Reserve has been a
significant distraction and pastime for market participants this
year. But a distraction is all it is.
The economic and political environment has so far not proven
contrary to expectations; the world is rolling along mostly as
anticipated, despite all the daily noise suggesting otherwise. Just
as company earnings should not be viewed in a vacuum (but in the
context of the underlying business fundamentals and long-term
strategy) economic and political news needs to be considered in
the context of the broad economic outlook which, so far this year,
remains positive and entirely consistent with expectations.
I was very pleased last week to announce the appointment
of Bruce McLachlan as our new Chief Executive Officer, to
take over the reins as I retire from my executive role. Bruce
will be joining Fisher Funds from 18 April 2017 and I really am
delighted as he has a wealth of experience in the financial
sector and importantly, a passion for client service.
When we began our search for a new chief executive,
we knew we wanted someone who understood and was
excited about maintaining and growing the wealth of New
Zealanders. We looked for someone who would continue our
longstanding performance record and our commitment to
exceptional client service. Bruce was an obvious choice for
the role.
Bruce has been CEO of The Co-Operative Bank for the past
four years. Under his leadership, the bank has consistently
achieved top rankings in customer satisfaction and client
service. Previously, Bruce worked for 10 years at Westpac NZ,
where his roles included leading both its business banking
and retail banking businesses; he was also Westpac NZ’s
acting CEO during 2008/9.
I will remain a director of the Kingfish Board and a member of
the Board sub-committees, including the
Kingfish Investment Committee and
look forward to seeing you at the
Annual Shareholder Meeting later
this year.
Carmel Fisher
Managing Director,
Fisher Funds
1
Monthly Update
March 2017
KFL NAV
$
1.40
SHARE PRICE
$
1.33
WARRANT PRICE
$
0.06
DISCOUNT
5.3
%
as at 28 February 2017
Introducing Fisher
Funds’ new CEO:
Bruce McLachlan

Sector Split
as at 28 February 2017
Key Details
as at 28 February 2017
FUND TYPE
Listed Investment Company
INVESTS IN
Growing New Zealand companies
LISTING DATE
31 March 2004
FINANCIAL YEAR END
31 March
TYPICAL PORTFOLIO SIZE
15-25 stocks
INVESTMENT CRITERIA
Long-term growth
PERFORMANCE
OBJECTIVE
Long-term growth of capital and
dividends
TAX STATUS
Portfolio Investment Entity (PIE)
MANAGER
Fisher Funds Management
Limited
MANAGEMENT
FEE RATE
1.25% of gross asset value
(reduced by 0.10% for every 1% of
underperformance relative to the
change in the NZ 90 Day Bank Bill
Index with a floor of 0.75%)
PERFORMANCE
FEE HURDLE
Changes in the NZ 90 Day Bank
Bill Index + 7%
PERFORMANCE FEE
15% of returns in excess of
benchmark and high water mark
HIGH WATER MARK
$1.27 per share
SHARES ON ISSUE
156m
MARKET CAPITALISATION
$208m
GEARING
None (maximum permitted 20%
of gross asset value)
1 Month3 Months1 Year3 Years
(accumulated)
5 Years
(accumulated)
KFL Adjusted NAV*+1.4%+4.3%+15.6%+37.5%+98.9%
Total Shareholder Return*(2.2%)(2.8%)+13.2%+34.1%+126.8%
Gross Performance^+1.8%+5.0%+19.0%+48.4%+132.5%
S&P/NZX50G Index+1.7%+3.9%+15.0%+43.6%+115.7%
Performance
to 28 February 2017
^ Gross of fees and tax and adjusting for capital management initiatives
*Definitions of non-GAAP measures:
Adjusted Net Asset Value (Adjusted NAV)
The adjusted NAV per share represents the total assets of Kingfish (investments and cash) minus any
liabilities (expenses and tax), divided by the number of shares on issue. It adds back dividends paid to
shareholders and adjusts for:
»the impact of shares issued under the dividend reinvestment plan at the discounted
reinvestment price;
»shares bought on-market (share buybacks) at a price different to the NAV, and;
»warrants exercised at a price different to the NAV at the time exercised.
Adjusted NAV assumes all dividends are reinvested in the company’s dividend reinvestment plan and
excludes imputation credits.
The directors believe this metric to be useful as it reflects the underlying performance of the investment
portfolio adjusted for dividends, share buybacks and warrants, which are capital allocation decisions and
not a reflection of the portfolio’s performance.
2
3
%
ENERGY
32
%
INDUSTRIALS
11
%
CONSUMER
DISCRETIONARY
2
%
INFORMATION
TECHNOLOGY
34
%
HEALTHCARE
5
%
CONSUMER
STAPLES
11
%
UTILITIES
The Kingfish portfolio also holds cash.
Total Shareholder Return (TSR)
The TSR combines the share price performance, the warrant price performance (when warrants are on
issue), the net value of converting warrants into shares and dividends paid to shareholders.
TSR assumes:
»all dividends paid are reinvested in the company’s dividend reinvestment plan at the
discounted reinvestment price and exclude imputation credits, and;
»all shareholders that have received warrants (for free), have subsequently exercised their
warrants at the warrant expiry date and bought shares (if they were in the money).
The directors believe this metric to be useful as it reflects the return of an investor who reinvests their
dividends and, if in the money, exercises their warrants at warrant maturity date for additional shares.
No metric has been included for investors who choose other investment options.
Comparative information
Kingfish’s TSR and Adjusted NAV historical information has been restated. The restated values are
based on the methodology described above. This methodology has resulted in some differences
between the TSR and Adjusted NAV reported in this communication compared to previous
communications. Please note this methodology will be used for all future communications.

February’s Biggest Movers
Typically the Kingfish portfolio will be invested 90% or more in equities.
The remaining portfolio is made up of another 15 stocks and cash.
EBOS GROUP
+9
%
AUCKLAND
INTERNATIONAL AIRPORT
+7
%
DELEGAT
GROUP
+6
%
SUMMERSET
GROUP
+5
%
METRO
PERFORMANCE GLASS
-23
%
5 Largest Portfolio Positions
as at 28 February 2017
MAINFREIGHT
12
%
FISHER & PAYKEL
HEALTHCARE
11
%
FREIGHTWAYS
10
%
RYMAN HEALTHCARE
9
%
INFRATIL
7
%
Total Shareholder Return
to 28 February 2017
3
Mar
2004
Mar
2005
Mar
2006
Mar
2007
Mar
2008
Mar
2009
Mar
2010
Mar
2011
Mar
2012
Mar
2014
Mar
2015
Mar
2013
Mar
2016
Share Price/Total Shareholder Return
$
2.50
$
3.00
$
2.0 0
$
1.50
$
1.00
Share PriceTotal Shareholder Return
$
3.50
$
0.50
$
0.00

Disclaimer: The information in this update has been prepared as at the date noted on the front page. The information has been prepared as a general summary of the matters covered only, and it is
by necessity brief. The information and opinions are based upon sources which are believed to be reliable, but Kingfish Limited and its officers and directors make no representation as to its accuracy
or completeness. The update is not intended to constitute professional or investment advice and should not be relied upon in making any investment decisions. Professional financial advice from an
authorised financial adviser should be taken before making an investment. To the extent that the update contains data relating to the historical performance of Kingfish Limited or its portfolio companies,
please note that fund performance can and will vary and that future results may have no correlation with results historically achieved.
Kingfish Limited
Private Bag 93502, Takapuna, Auckland 0740
Phone: +64 9 489 7094 | Fax: +64 9 489 7139
Email: enquire@kingfish.co.nz | www.kingfish.co.nz
4
Computershare Investor Services Limited
Private Bag 92119, Auckland 1142
Phone: +64 9 488 8777 | Fax: +64 9 488 8787
Email: enquiry@computershare.co.nz | www.computershare.com/nz
About Kingfish
Kingfish is an investment company
listed on the New Zealand Stock
Exchange. The company gives
shareholders an opportunity to
invest in a diversified portfolio of
between 15 and 25 growing New
Zealand companies through a
single, professionally managed
investment. The aim of Kingfish
is to offer investors competitive
returns through capital growth
and dividends.
Capital Management Strategies
Regular Dividends
»Quarterly distribution policy introduced in
June 2009
»Under this policy, 2% of average NAV is targeted
to be paid to shareholders quarterly
»Dividends paid by Kingfish may include dividends
received, interest income, investment gains
and/or return of capital
» This policy is well received by shareholders as it
provides an attractive and regular return that is
referable to the NAV
»Shareholders who prefer to have increased
capital rather than a regular income stream have
the opportunity to participate in the company’s
dividend reinvestment plan (DRP)
»Shares issued to DRP participants are at a 3%
discount to market price
»Kingfish became a portfolio investment entity on
1 October 2007. As a result, dividends paid to
New Zealand tax resident shareholders have not
been subject to further tax
Share Buyback Programme
»Kingfish has a buyback programme in place allowing
it (if it elects to do so) to acquire up to 7.7m of its
shares on market in the year to 31 October 2017
»Shares bought back by the company are held as
treasury stock
» Shares held as treasury stock are available to be
re-issued for the dividend reinvestment plan and to
pay performance fees
Warrants
»On 19 April 2016, a new issue of warrants (KFLWD)
was announced
» The warrants were issued at no cost to shareholders
and in the ratio of one warrant for every four Kingfish
shares held
»Exercise Price = $1.32 per Share on the exercise of
each Warrant (adjusted for dividends declared during
the period up to the Exercise Date)
»Exercise Date = 5 May 2017
» The final Exercise Price will be announced and an
Exercise Form will be posted to warrant holders in
April 2017
Management
Kingfish’s portfolio is managed
by Fisher Funds Management
Limited. Sam Dickie (Senior
Portfolio Manager) and Zoie
Regan (Senior Investment Analyst)
have prime responsibility for
managing the Kingfish portfolio
and with over 30 years combined
experience, are very capable of
researching and investing in the
quality New Zealand companies
that Kingfish targets. Fisher Funds
is based in Takapuna, Auckland.
Board
The Manager has authority
delegated to it from the
Board to invest according to
the Management Agreement
and other written policies.
The Board of Kingfish
comprises independent
directors Alistair Ryan (Chair),
Carol Campbell and Andy
Coupe; and non-independent
director Carmel Fisher.