BRM – April 2019 monthly update

1
Monthly Update
April 2019
BRM NAV
$
0.65
SHARE PRICE
$
0.57
WARRANT PRICE
$
0.01
as at 31 March 2019
A word from the Manager
Market Overview
The ASX 200 returned +0.7% (in A$) in March. With global
interest rates falling during the month, yield sensitive sectors
such as Real Estate (+5.5%) and Communication Services
(+4.0%) led the index higher, with strong support from
Consumer Staples (+3.9%) and the Materials sector (+3.5%)
which continues to benefit from the Vale-driven disruption
to the iron ore market. Energy (-4.1%) and Financials (-2.7%)
sectors were the only two sectors closing the month in the
red. The former was weighed down by poor performances
from oil focussed companies, while the latter was impacted
by the banks which gave up a portion of their Royal
Commission relief rally.
Portfolio News
Following the end to reporting season, March proved to be a
relatively quiet month on the news flow front for our portfolio
companies.
After falling a few percent in February, Wisetech (+20%
in A$ for the month) rebounded strongly in March. The
company raised $300m in an equity placement during the
month. Prior to this, Wisetech’s cash balance was running
low. The company does have undrawn debt facilities at its
disposal. However, management has been clear that they
are still focussed on their strategy of investing heavily in
organic growth as well as through acquisitions (which they
have signalled will be bigger than the acquisitions in recent
years). The market is pleased that balance sheet flexibility
and funding optionality has been replenished through this
capital raising. Wisetech re-affirmed full year guidance during
the month as well.
Ooh Media! (+11.9%) rose strongly during the month.
Outdoor Media Association industry data released in
March showed double digit increases in growth across
the December quarter in 2018 in a number of key outdoor
advertising categories for Ooh Media! including roadside
billboards and street furniture/buses. Retail, which was down
-1.7% was the one notable laggard. The company faces some
nearer term headwinds given outdoor advertising spending
can be adversely affected by the uncertainty in the run up
to elections, (a general election is expected in Australia in
May). However this industry data released in March provided
further reinforcement of the longer term positive structural
trends for the outdoor advertising industry.
Ansell (+3.3%) announced an orderly re-organisation of
some of its senior leadership team in March with the heads of
its two major business units (industrial and healthcare) both
departing to make way for internally appointed successors.
The successors’ existing roles (CFO, and VP of Global
Operations respectively) are being filled by two external
appointments. CEO Magnus Nicolin is scheduled to retire in
2021 and the company has flagged that these changes are
being made to further strengthen the executive team ahead
of the CEO succession. There is speculation that the new
business unit appointments are both potential candidates to
replace him and are being tested for suitability through being
given line management experience in the interim.
Our bank shareholdings gave up a meaningful portion of
their Royal Commission relief rally in March with CBA (-4.5%)
and WBC (-3.9%) both falling. NAB (+0.6%) rose during the
month but underperformed the index. Operating conditions
are showing few signs of improving with soft house price
and credit lending data, and the prospect of higher capital
requirements in their NZ subsidiaries all continuing to weigh
on performance.
Portfolio Changes
In a key change during the month we sold our BHP position
because we deemed it to be in contravention of our
Responsible Investing Policy by virtue of being a significant
producer of thermal coal.
One of our core investment beliefs at Fisher Funds is to
only invest in companies that act responsibly. As articulated
in our Responsible Investing Policy, this means that we will
not maintain an investment in a company that engages in
behaviour that compromises acceptable environmental,
social or governance standards. This includes companies that
are significant producers of thermal coal.
DISCOUNT
1
12.2
%
1
Share Price Discount to NAV (including warrant price on a pro-rated basis).

Sector Split
as at 31 March 2019
Key Details
as at 31 March 2019
FUND TYPE
Listed Investment Company
INVESTS IN
Growing Australian companies
LISTING DATE
26 October 2006
FINANCIAL YEAR END
30 June
TYPICAL PORTFOLIO SIZE
25-35 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
BENCHMARK
Changes in the NZ 90 Day Bank
Bill Index + 7%
PERFORMANCE
FEE HURDLE
15% of returns in excess of
benchmark and high water mark
HIGH WATER MARK
$0.67
SHARES ON ISSUE
171m
MARKET CAPITALISATION
$97m
GEARING
None (maximum permitted 20%
of gross asset value)
11
%
INFORMATION
TECHNOLOGY
20
%
11
%

INDUSTRIALS
19
%
COMMUNICATION
SERVICES

FINANCIALS
20
%
HEALTH CARE
6
%

CASH
9
%
CONSUMER
DISCRETIONARY
When we built our positions in BHP and Rio Tinto in
2016, both companies were producers of thermal coal.
At the time it looked to us as if they were actively exiting
their thermal coal operations. For this reason, we felt
both companies were permissible holdings under our
Responsible Investing Policy.
Since then, Rio Tinto has exited thermal coal completely,
selling its last mine in 2018 and we continue to maintain a
shareholding in the company.
While BHP had exited a number of thermal coal assets
when it de-merged the South32 operation in 2015, it has
however, hung onto its remaining assets in Colombia and
Australia. Recent commentary from the company indicates
that it is happy with its remaining thermal coal exposure.
This was a big red flag for us.
2
%

REAL ESTATE
Robbie Urquhart
Senior Portfolio Manager
Fisher Funds Management Limited
2
%

MATERIALS
So, notwithstanding that we still regard BHP’s portfolio
of businesses and management team highly, we have
drawn a line in the sand. Until the remaining thermal
coal assets are disposed of, we will no longer be
investing in BHP’s shares.
2

March’s Biggest Movers in Australian dollar terms
Typically the Barramundi portfolio will be invested 90% or more in equities.
WISETECH
+20
%
OOH MEDIA!
+12
%
TECHNOLOGY ONE
+8
%
AUB GROUP
+7
%
RIO TINTO
+8
%
5 Largest Portfolio Positions as at 31 March 2019
CSL LIMITED
7
%
SEEK
7
%
CARSALES.COM
7
%
COMMONWEALTH
BANK OF AUSTRALIA
5
%
XERO LIMITED
5
%
The remaining portfolio is made up of another 20 stocks and cash.
Oct
2006
Oct
2007
Oct
2008
Oct
2009
Oct
2010
Oct
2011
Oct
2012
Oct
2013
Oct
2015
Oct
2016
Oct
2014
Share Price/Total Shareholder Return
$
1.00
$
1.20
$
0.8 0
$
0.60
$
0.40
Share PriceTotal Shareholder Return
$
1.60
$
0.20
$
0.00
$
1.40
Oct
2017
Oct
2018
Total Shareholder Return to 31 March 2019
1 Month3 Months1 Year3 Years
(annualised)
Since Inception
(annualised)
Company Performance
Total Shareholder Return(1.4%)+0.3%+7.9%+7.0%+3.2%
Adjusted NAV Return+1.5%+10.9%+8.7%+7.4%+4.0%
Portfolio Performance
Gross Performance Return+1.9%+11.9%+13.3%+10.9%+7.3%
Benchmark Index^+0.7%+10.6%+11.5%+11.2%+3.1%
Performance to 31 March 2019
^Benchmark Index: S&P/ASX Small Ords Industrial Gross Index until 30 September 2015 & S&P/ASX 200 Index (hedged 70% to NZD) from 1 October 2015
Non–GAAP Financial Information
Barramundi uses non–GAAP measures, including adjusted net asset value, adjusted NAV return, gross performance return and total shareholder return. The rationale for using such non–GAAP measures is as follows:
»adjusted net asset value – the underlying value of the investment portfolio adjusted for capital allocation decisions,
»adjusted NAV return – the return to an investor after fees and tax,
»gross performance return – the Manager’s portfolio performance in terms of stock selection and currency hedging before fees and tax, and
»total shareholder return – the return to an investor who reinvests their dividends, and if in the money, exercises their warrants at warrant maturity date for additional shares.
All references to adjusted net asset value, adjusted NAV return, gross performance return and total shareholder return in this monthly update are to such non–GAAP measures. The calculations applied to non–GAAP
measures are described in the Barramundi Non–GAAP Financial Information Policy. A copy of the policy is available at http://barramundi.co.nz/about-barramundi/barramundi-policies/
3

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 Barramundi 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 Barramundi 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.
Barramundi Limited
Private Bag 93502, Takapuna, Auckland 0740
Phone: +64 9 489 7074 | Fax: +64 9 489 7139
Email: enquire@barramundi.co.nz | www.barramundi.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 Barramundi
Barramundi 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 25 and 35 quality
growing Australian companies
through a single, professionally
managed investment. The aim of
Barramundi is to offer investors
competitive returns through
capital growth and dividends.
Capital Management Strategies
Regular Dividends
»Quarterly distribution policy introduced in
August 2009
»Under this policy, 2% of average NAV is targeted
to be paid to shareholders quarterly
»Dividends paid by Barramundi may include
dividends received, interest income, investment
gains and/or return of capital
»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
»Barramundi 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
»Barramundi has a buyback programme in place
allowing it (if it elects to do so) to acquire up to 8.4m of
its shares on market in the year to 31 October 2019
»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 16 October 2018, a new issue of warrants (BRMWE)
was announced
»The warrants were issued 1 November 2018 at no cost
to eligible shareholders and in the ratio of one warrant
for every four Barramundi shares held
»Exercise Price = $0.64 per warrant, to be adjusted down
for dividends declared during the period up to the
Exercise Date
»Exercise Date = 25 October 2019
»The final Exercise Price will be announced and an
Exercise Form will be posted to warrant holders in
September 2019
Management
Barramundi’s portfolio is managed
by Fisher Funds Management
Limited. Robbie Urquhart
(Senior Portfolio Manager),
Terry Tolich (Senior Investment
Analyst) and Delano Gallagher
(Investment Analyst) have prime
responsibility for managing the
Barramundi portfolio. Together
they have significant combined
experience and are very capable
of researching and investing in the
quality Australian companies that
Barramundi 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 Barramundi
comprises independent
directors Alistair Ryan (Chair),
Carol Campbell, Andy Coupe
and Carmel Fisher.