KFL – August 2019 monthly update

1
Monthly Update
August 2019
A word from the Manager
Market Environment
Kingfish achieved an adjusted NAV return of 4.3% in
July. The New Zealand market continued its 2019 ‘clean
sheet’ with a 3.4% return in July (S&P/NZX50G) – so far
every month has been positive for the calendar year. New
Zealand continues to perform well compared to global
markets, supported by low interest rates. It’s worth noting
however that at the time of putting this monthly update
together higher levels of volatility have returned to the
markets in early August.
The Portfolio
It was a relatively quiet month in terms of news flow ahead
of the August reporting season.
a2 Milk shares returned a stellar 22.8% in the month,
justifying our decision to top up our position on weakness
in the preceding months. We attended Synlait’s investor
day, which showcased that a2 has a best-in-class
manufacturing partner. The Dunsandel plant where most
of a2’s infant formula is manufactured is very impressive in
terms of its cleanliness, newness, and levels of automation.
It was great to see the infant formula canning line rapidly
firing through tin after tin of a2’s Stage 3 product. Synlait
commented that unplanned stoppages are now more
infrequent which we think significantly increases the actual
capacity of the plant. This should support a2’s strong
volume growth and also creates cost benefits for a2.
Mainfreight released its semi-annual newsletter and
provided a trading update at its Annual Meeting of
Shareholders. The company is continuing to get traction
with its sales efforts in the US and Europe and has a
strong forward looking pipeline of opportunities to add
new customers. These addressable markets are huge,
with Mainfreight’s current operations barely scratching
the surface, and represents long duration growth
opportunities.
Auckland Airport dipped 5.5% during the month, giving
back some of the strong recent gains. New Zealand will
introduce a $35 International Visitor Conservation and
Tourism Levy (IVL) later in 2019 on all international visitor
arrivals excluding Australia and the Pacific. At the margin
we think this may dampen tourism flows and it would
appear that the market has adopted a similar view, given
the recent share price weakness.
Portfolio Changes
We added slightly to the position in Mainfreight
during the month and trimmed Freightways. We think
Mainfreight’s prospects in the US and Europe remain
under-appreciated.
1
Share Price Discount to NAV (including warrant price on a pro-rated basis)
KFL NAV
$
1.62
SHARE PRICE
$
1.46
DISCOUNT
1
10.0
%
as at 31 July 2019
Sam Dickie
Senior Portfolio Manager
Fisher Funds Management Limited

Key Details
as at 31 July 2019
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
10% of returns in excess of
benchmark and high water mark
HIGH WATER MARK
$1.47
PERFORMANCE FEE CAP
1.25%
SHARES ON ISSUE
242m
MARKET
CAPITALISATION
$354m
GEARING
None (maximum permitted 20%
of gross asset value)
Sector Split
as at 31 July 2019
1
%
27
%
HEALTH CARE
19
%

UTILITIES

MATERIALS
28
%
INDUSTRIALS
11
%
CONSUMER
STAPLES
1
%
CONSUMER
DISCRETIONARY
7
%
INFORMATION
TECHNOLOGY
2
Performance
to 31 July 2019
1 Month3 Months1 Year3 Years
(annualised)
5 Years
(annualised)
Company Performance
Total Shareholder Return+2.4%+4.7%+16.0%+13.5%+12.6%
Adjusted NAV Return+4.4%+8.1%+20.5%+14.7%+14.5%
Portfolio Performance
Gross Performance Return+5.0%+9.1%+24.9%+17.6%+17.4%
S&P/NZX50G Index+3.4%+8.4%+21.7%+13.9%+16.0%
Non-GAAP Financial Information
Kingfish 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 after fees and tax,
»adjusted NAV return – the net return to an investor after fees and tax,
»gross performance return – the Manager’s portfolio performance in terms of stock selection, 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 Kingfish Non-GAAP Financial Information Policy. A copy of the policy is available at http://kingfish.co.nz/about-kingfish/kingfish-policies/
The Kingfish portfolio also holds cash

3
Total Shareholder Return
to 31 July 2019
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
$
4.50
$
5.00
$
0.50
$
0.00
Mar
2017
$
3.50
Mar
2018
$
4.00
Mar
2019
July’s Biggest Movers
Typically the Kingfish portfolio will be invested 90% or more in equities.
The remaining portfolio is made up of another 10 stocks and cash.
5 Largest Portfolio Positions
as at 31 July 2019
THE A2 MILK
COMPANY
+23
%
RYMAN HEALTHCARE
+10
%
FISHER & PAYKEL
HEALTHCARE
+7
%
AUCKLAND
INTERNATIONAL
AIRPORT
-6
%
PUSHPAY HOLDINGS
-13
%
THE A2 MILK
COMPANY
15
%
FISHER & PAYKEL
HEALTHCARE
14
%
INFRATIL
13
%
MAINFREIGHT
8
%
FREIGHTWAYS
7
%

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 quality
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
»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 9.7m 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
Warrants
»Warrants put Kingfish in a better position to grow
further, operate efficiently and pursue other capital
structure initiatives as appropriate
»A warrant is the right, not the obligation, to purchase
an ordinary share in Kingfish at a fixed price on a
fixed date
»There are currently no warrants on issue
Management
Kingfish’s portfolio is managed
by Fisher Funds Management
Limited. Sam Dickie (Senior
Portfolio Manager), Zoie Regan
(Senior Investment Analyst) and
Matt Peek (Investment Analyst)
have prime responsibility for
managing the Kingfish portfolio.
Together they have over 40 years
combined experience and 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.