MLN – November 2019 monthly update

1
A word from the Manager
October was a good month for global equity markets,
driven by signs of an improving geopolitical backdrop.
Tensions between the US and China appear to be
improving, with signs their trade delegations are edging
closer to a partial trade deal. In the UK a hastily arranged
snap election has seen the country step back from the
precipice of a no-deal Brexit (for now). The US S&P 500
Index gained 2.2% in October, hitting fresh all-time highs,
driven by this improved backdrop and a better than feared
US corporate reporting season.
Marlin gained 0.3% (gross performance) for the month,
compared with our global benchmark which gained 1.3%.
The Marlin Adjusted NAV return for October was -0.2%.
Portfolio Company Developments
Facebook (+8%) was a strong performer in the portfolio this
month, reporting better than expected third-quarter results.
Facebook and Instagram continue to attract more users and
Instagram’s Stories format continues to grow in popularity
with both users and advertisers. Despite Facebook’s size,
advertising revenues grew a massive 28% on the prior year
and profits increased 19%. While Facebook continues to
garner a lot of newspaper headlines and political attention,
the product teams have continued to focus on innovating
and making their products more useful for both users and
advertisers. A good example of this is the new Checkout
for Instagram, which allows users to shop, purchase and
track orders directly in the Instagram app. The popularity
of Instagram Stories and other platform improvements are
driving increased user engagement and advertisers continue
to flock to the platform to reach consumers no longer
watching TV or reading the newspaper. While we believe
Facebook must continue to address the myriad of issues
associated with running a social network (user safety, privacy
concerns, security, election interference etc), they continue
to build a strong business with a lot of growth potential. We
believe the business is still materially undervalued despite
the 46% increase in share price so far this year.
LKQ Corp (+8%) a distributor of replacement auto parts,
gained in October after reporting strong cash flow growth.
LKQ’s European business has struggled over the last two
years, with the weak European economic environment
weighing on revenue growth and the integration of a
number of acquisitions crimping profit margins. Evidence
that management’s recent actions to streamline the
business, improve margins and enhance cash flow
generation saw its share price spike. LKQ has now gained
over 40% this year.
Fresenius Medical Care (+5%) the German kidney
dialysis service provider, continues to execute strongly in
an environment of uncertainty for dialysis providers in the
US. During the last quarter, Fresenius saw an acceleration
in growth of dialysis patients coming to its clinics and a
pick-up in dialysis equipment sales. Fresenius’s US dialysis
services growth continues to outpace peers, with home
dialysis in particular seeing strong growth rates. These
strong results came at a time of increasing regulation
in the US dialysis sector, with the Trump administration
introducing regulation to push for an increase in home
dialysis over in-clinic care. The proposed regulations are
still in the consultation phase, but we believe Fresenius
is well positioned for these changes due to its proactive
investments in home dialysis in recent years.
EssilorLuxottica (+3%) the eyewear and optical lens
giant, reported a similar story of strong execution and
accelerating growth. The Essilor lenses business saw
growth hit the top end of its 4-6% medium-term target
range, while the Luxottica eyewear business also saw
good growth. The company, which was created through
the merger of Luxottica and Essilor in 2018, reconfirmed
its synergy targets and is already seeing the benefits of
early initiatives such as increasing sales of Essilor lenses in
Luxottica’s retail stores. The recently announced acquisition
of Grandvision further consolidates the company’s position
as the global leader in eyewear.
1
Share Price Discount to NAV (using NAV to four decimal places)
Monthly Update
November 2019
MLN NAV
$
1.00
SHARE PRICE
$
0.95
DISCOUNT
1
5.3
%
as at 31 October 2019

2
Sector Split
as at 31 October 2019
Key Details
as at 31 October 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
$0.94
PERFORMANCE FEE CAP
1.25%
SHARES ON ISSUE
148m
MARKET
CAPITALISATION
$141m
GEARING
None (maximum permitted 20%
of gross asset value)
29
%
CONSUMER
DISCRETIONARY
9
%
FINANCIALS
17
%

HEALTH CARE
18
%
INFORMATION
TECHNOLOGY
Geographical Split
as at 31 October 2019
16
%
WEST EUROPE
74
%
NORTH AMERICA
8
%
INDUSTRIALS
10
%

ASIA
The Marlin portfolio also holds cash.
18
%
COMMUNICATION
SERVICES
Hexcel (-9%) the carbon fibre composites supplier, fell in October due to continued issues with its large customer Boeing. The
main issue is the continued grounding of Boeing’s 737 Max aircraft, following two fatal crashes caused by faults in Boeing’s plane
design. Delays getting the 737 Max back into the air have now forced Boeing to reduce production rates, which is having a
knock-on effect for suppliers like Hexcel. While Boeing is confident that the 737 Max will return to service by the end of the year,
this will have a short-term impact on Hexcel’s growth.
Ashley Gardyne
Senior Portfolio Manager
Fisher Funds Management Limited

3
October’s Biggest Movers in local currency terms
Typically the Marlin portfolio will be invested 90% or more in equities.
EDWARD
LIFESCIENCES CORP
+8
%
LKQ CORPORATION
+8
%
FACEBOOK
+8
%
HEXCEL CORP
+6
%
5 Largest Portfolio Positions as at 31 October 2019
ALPHABET
8
%
ALIBABA GROUP
6
%
FACEBOOK
6
%
TJX COMPANIES
5
%
MASTERCARD
5
%
The remaining portfolio is made up of another 21 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 October 2019
Performance to 31 October 2019
1 Month3 Months1 Year3 Years
(annualised)
5 Years
(annualised)
Company Performance
Total Shareholder Return+2.2%+2.1%+13.4%+17.4%+13.0%
Adjusted NAV Return(0.2%)+3.0%+18.8%+16.5%+11.5%
Portfolio Performance
Gross Performance Return +0.3%+3.4%+22.4%+20.3%+15.3%
Benchmark Index^+1.3%+3.0%+10.8%+12.6%+12.0%
^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/
ALIBABA GROUP
-9
%

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 7.3m of its
shares on market in the year to 31 October 2020
»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
»New warrants (MLNWD) have been issued by Marlin
in early November 2019

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.