MLN – September 2019 monthly update

1
A word from the Manager
Market Overview
The tone for markets in August was set on its first day, when
President Trump announced a 10% tariff on all remaining
Chinese imports. The decision came as a surprise given the
ceasefire agreed at the G20 in May, driving global equities
lower. The US S&P 500 Index fell 1.8%, the European Stoxx
600 Index dropped 1.6% and the Hong Kong Hang Seng
Index fell 7.4% for the month.
Global interest rates also headed lower in August. By the
end of the month the US 10-year bond rate had fallen to
1.5% and almost half of all European investment grade
bonds now have negative yields. The recent drop in interest
rates reflects investor concern about the global economic
outlook, with a weak global manufacturing sector and a
handful of European countries close to recession. This
includes Germany, which had been a bright spot in Europe
until recently. However, while global growth is weaker than
last year, unemployment is still low and consumer spending
is robust in many countries. Corporate earnings also
continue to grow, with the recent US earnings season better
than many feared.
When global investor fears spike the New Zealand Dollar
often falls and acts as a shock absorber for the Marlin
portfolio. This helped in August, with our weak currency
boosting Marlin’s New Zealand Dollar returns for the month.
A strong reporting season for our portfolio companies also
contributed to Marlin’s outperformance over the month.
Marlin’s gross performance return was +2.2% in August,
while our global benchmark fell 0.5%.
Portfolio Company Developments
Two of our more defensive portfolio holdings, Dollar
General and Zoetis, contributed strongly to returns in a
difficult market.
Dollar General (+16%) rallied sharply following second
quarter earnings. The company continues to capture
a greater share of low and middle-income consumers’
budgets, while internal initiatives including DG Fresh and
Fast Track are showing promise. DG Fresh is accretive to
gross margin. It brings the distribution of fresh and frozen
products in-house, lowering procurement costs and fees
paid to distributors. Fast Track involves using shelf-ready
containers to reduce the time required to stock shelves
and reduce out-of-stock occurrences. Early results have
shown a 20% increase in item availability.
Zoetis (+10%) continues to deliver for the portfolio,
buoyed by strong trends in animal health spending.
Revenue was up across all segments, with companion
animal again the standout. Zoetis’s novel dermatology
products grew around 30%, and with a strong pipeline
of new products over the next few years we expect this
growth to be sustained. Fears of a negative impact
from the African Swine flu did not eventuate, reflecting
the benefit of Zoetis’ diversified drug portfolio. With
exposure to all regions and animal species – weakness in
one area is typically offset by strength in another.
While investors have been nervous about the Chinese
economy, Alibaba (+1%) shrugged off these concerns
and delivered another strong quarter of growth. The
Chinese consumer continues to spend and this spending
continues to shift online. Alibaba’s core commerce
business grew 44% over last year, driven by advertising
and commission revenue in its ecommerce marketplaces
and 137% growth in its food delivery business. User
numbers grew 17% as Alibaba continues to penetrate
lower-tier cities and less developed regions. Retail
consumption from these regions is expected to triple
over the next ten years, which should sustain growth in
Alibaba’s business for years to come.
Tencent (-12%) was the only company to drag
materially on performance in the month. While the
overall result was solid, weakness in its advertising
business disappointed some investors. The company
delivered 21% revenue growth, supported by its
mobile gaming business. While gaming is the largest
segment, Tencent continues to diversify into the fast
growing cloud computing and financial technology
businesses, which together grew 37% over last year.
While advertising revenue growth has slowed due to
1
Share Price Discount to NAV (using NAV to four decimal places)
Monthly Update
September 2019
MLN NAV
$
1.02
SHARE PRICE
$
0.94
DISCOUNT
1
7.7
%
as at 31 August 2019

2
Ashley Gardyne
Senior Portfolio Manager
Fisher Funds Management Limited
the uncertain macro environment, we still see good growth
ahead for Tencent’s advertising business as it increases the
ad-load on the WeChat app and gives advertisers greater
access to its one billion users.
With the bulk of the Marlin portfolio having now reported
second quarter earnings we are pleased with how the
companies are tracking. With reporting season in the rear-view
mirror we have returned to our favourite pastime of looking for
new investment ideas. While markets are certainly not cheap,
we are still finding a small number of prospective investments
that we believe will make attractive investments. Our Senior
Sector Split
as at 31 August 2019
Key Details
as at 31 August 2019
FUND TYPE
Listed Investment Company
INVESTS IN
Growing international companies
LISTING DATE
1 October 2007
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
FEE HURDLE
Changes in the NZ 90 Day Bank
Bill Index + 5%
PERFORMANCE FEE
10% of returns in excess of
benchmark and high water mark
HIGH WATER MARK
$0.96
PERFORMANCE FEE CAP
1.25%
SHARES ON ISSUE
147m
MARKET
CAPITALISATION
$138m
GEARING
None (maximum permitted 20%
of gross asset value)
27
%
CONSUMER
DISCRETIONARY
9
%
FINANCIALS
18
%

HEALTH CARE
18
%
COMMUNICATION
SERVICES
Geographical Split
as at 31 August 2019
16
%
WEST EUROPE
74
%
NORTH AMERICA
8
%
INDUSTRIALS
10
%

ASIA
The Marlin portfolio also holds cash.
18
%
INFORMATION
TECHNOLOGY
Investment Analyst, Harry Smith, is heading to Germany and
the UK shortly to meet with some of these businesses, and I
am planning a trip to the US later in the year.

August’s Biggest Movers in local currency terms
Typically the Marlin portfolio will be invested 90% or more in equities.
DOLLAR GENERAL
+16
%
ZOETIS INC
+10
%
ESSILORLUXOTTICA
SA
+9
%
TENCENT
HOLDINGS
-8
%
5 Largest Portfolio Positions as at 31 August 2019
ALPHABET
9
%
ALIBABA GROUP
6
%
FACEBOOK
6
%
MASTERCARD
5
%
PAYPAL
5
%
The remaining portfolio is made up of another 20 stocks and cash.
Nov
2007
Nov
2008
Nov
2009
Nov
2010
Nov
2011
Nov
2012
Nov
2014
Nov
2013
Share Price/Total Shareholder Return
Share PriceTotal Shareholder Return
Nov
2015
$
1.00
$
0.50
$
0.00
$
1.50
Nov
2016
Nov
2017
$
2.50
$
2.00
Nov
2018
Total Shareholder Return to 31 August 2019
Performance to 31 August 2019
1 Month3 Months1 Year3 Years
(annualised)
5 Years
(annualised)
Company Performance
Total Shareholder Return(1.1%)+10.6%+7.6%+15.6%+13.1%
Adjusted NAV Return+2.5%+10.3%+7.7%+15.8%+11.9%
Portfolio Performance
Gross Performance Return +2.2%+10.8%+10.5%+19.5%+15.7%
Benchmark Index^(0.5%)+5.1%(1.7%)+11.2%+11.9%
3
^Benchmark index: World Small Cap Gross Index until 30 September 2015 & S&P Large Mid Cap/S&P Small Cap Index (50% hedged to NZD) from 1 October 2015
Non-GAAP Financial Information
Marlin 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 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 Marlin Non-GAAP Financial Information Policy. A copy of the policy is available at http://marlin.co.nz/about-marlin/marlin-policies/
SIGNATURE BANK
-12
%

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 Marlin Global 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 Marlin Global 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.
Marlin Global Limited
Private Bag 93502, Takapuna, Auckland 0740
Phone: +64 9 484 0365 | Fax: +64 9 489 7139
Email: enquire@marlin.co.nz | www.marlin.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
Marlin Global
Marlin 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
international companies (excluding
New Zealand and Australia)
through a single, professionally
managed investment. The aim
of Marlin is to offer investors
competitive returns through capital
growth and dividends.
Capital Management Strategies
Regular Dividends
»Quarterly distribution policy introduced in
August 2010
»Under this policy, 2% of average NAV is targeted
to be paid to shareholders quarterly
»Dividends paid by Marlin 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
»Marlin 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
»Marlin has a buyback programme in place allowing
it (if it elects to do so) to acquire up to 5.9m 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 Marlin 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 Marlin at a fixed price
on a fixed date
»There are currently no warrants on issue

Management
Marlin’s portfolio is managed
by Fisher Funds Management
Limited. Ashley Gardyne (Senior
Portfolio Manager), Chris
Waters and Harry Smith (Senior
Investment Analysts) have prime
responsibility for managing
the Marlin portfolio. Together
they have significant combined
experience and are very capable
of researching and investing in
the quality global companies that
Marlin 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 Marlin
comprises independent
directors Alistair Ryan (Chair),
Carol Campbell, and Andy
Coupe; and non-independent
director Carmel Fisher.