KFL – June 2023 monthly update

1
A WORD FROM THE MANAGER
In May, Kingfish’s gross performance return was down 0.5%
and the adjusted NAV return was down 0.6%. This compares
to the benchmark S&P/NZX50G, which was down 1.7%.
Several key investments reported their 2023 financial year
results during the month.
Fisher & Paykel Healthcare (-16%) weighed on performance
for the month, giving up some of its share price gains of
recent months. After several ups and downs during COVID,
the company is now seeing consistent growth in demand for
its respiratory products. This meant it was able to provide
guidance for revenue in the new 2024 financial year of $1.7
billion, in line with our expectations. The company reiterated
prior messaging that it expects to return to its targeted gross
profit margin of 65% and its operating margin target of 30%,
although this will take multiple years. While the medium-term
targets haven’t changed, in the next year it expects operating
expenses to increase by 12%, ahead of sales growth of
around 8%, as it has recently filled a large number of vacant
positions. This means that profit margins are not expected to
improve in the new 2024 financial year.
Infratil (+6%) reported its results in line with overall
expectations. Canberra Data Centres (CDC) reported 33%
growth in EBITDA (earnings before interest, tax, depreciation,
and amortisation), its key profit measure. This was in line with
expectations and Infratil expects around 23% further growth
in the coming year from CDC. To extend its pipeline of future
data centres, CDC has also purchased new sites in Sydney
and Melbourne. One NZ (formerly Vodafone NZ) reported
a strong result, with 11% growth in EBITDA, supported by
improved cost efficiency despite the inflationary environment.
Infratil’s US renewable energy business Longroad is working
towards building out its 8-gigawatt renewable development
pipeline, with 1.3 gigawatts currently under construction.
Recent legislation is supportive, with the Federal Government
providing around US$370 billion of subsidies via the Inflation
Reduction Act to lower the cost of renewable development.
This will accelerate demand for Longroad's offering.
Wellington Airport expects an uplift in aeronautical pricing
this year and passenger volumes to continue to improve.
Infratil’s diagnostic imaging business expects a return to pre-
COVID volumes as visits to general practitioners, which is a
key referral channel, return to normal.
Mainfreight (-3%) delivered its financial results in line with
expectations, albeit provided a relatively conservative outlook.
Consistent with its early February update, the company is
seeing more subdued conditions in all its markets than in
previous years. For the year, the Transport division grew
profit before tax +17%, although profit growth slowed in the
second half to +7%. Warehousing growth also decelerated
from strong growth rates (+31% in first half), particularly due
to some one-off costs, but after adjusting for these still grew
over +20% in the second half. Mainfreight’s ocean freight
volumes in the March quarter were -17% below the same
period a year ago, versus -8% for the full financial year. This
highlights that we are in a destocking period as customers
continue to transition from “just in case” to more cost effective
“just in time” inventory management. Outlook commentary
was cautious, given the company habitually measures itself
versus the previous year, when trading conditions were much
stronger, and volumes were higher. The company remains
very focused on managing costs tightly at the branch level
but continues to invest in growing its network and investing in
larger properties, which means it will be well placed to benefit
when trading conditions inevitably improve.
Ryman Healthcare (+20%) announced its full year results
during the month, with underlying profit of $302 million
ahead of expectations of $280-290 million at the time of
equity raising in February. The result saw strong margins for
both resales of existing units (31%) and new units developed
(29%), particularly new units in Australia (33%). Debt levels
were around $100 million better than expected, even
adjusting for the equity raising, with debt down to $2.3
billion. As a result, the company’s gearing had reduced to
33.1%, within its target range of 30-35%. The company has
also done a better job at managing costs.
Portfolio activity
The takeover of Pushpay concluded during the month, with
Kingfish receiving $1.42 per share for its shareholding.
1
Share Price Discount to NAV (using the net asset value per share, after expenses, fees and tax, to four decimal places).
MONTHLY UPDATE
June 2023
KFL NAV
$
1.40
$
1.35
Share Price
DISCOUNT
1
3.5
%
as at 31 May 2023

2
KEY DETAILS
as at 31 May 2023
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
$1.49
PERFORMANCE FEE CAP
1.25%
SHARES ON ISSUE
330m
MARKET CAPITALISATION
$445m
GEARING
None (maximum permitted 20%
of gross asset value)
SECTOR SPLIT
as at 31 May 2023
6
%
29
%
INDUSTRIALS
23
%
MATERIALS
31
%
HEALTH CARE
7
%
CONSUMER
STAPLES

UTILITIES
CASH
1
%
INFORMATION
TECHNOLOGY
3
%
Kingfish also added Vulcan Steel to the portfolio in May.
Vulcan is the leading steel distributor and value-add
processing player in New Zealand and Australia. It is an
impressive business in an unexciting industry.
Vulcan has a differentiated business model built around a
leading customer service proposition, in an industry where
customer service is typically poor. Vulcan’s ‘delivery in full and
on time’ metrics are far ahead of competitors, which enables
it to charge a premium for this reliability. This translates to
higher profit margins and returns on capital invested.
While it sounds simple, this high service model is driven by
Vulcan’s performance culture and customer-centric mentality.
It is enabled by its self-built technology platform and own
in-house fleet of delivery vehicles, but moreover by its people
and approach to customer service. The current management
team have grown the business organically and have a
business owner mentality with plenty of ‘skin in the game’.
This mentality is pushed down throughout the organisation
through its flat organisational structure and de-centralised
management approach, with its team members on the floor
also participating in the business’s success through profit share
incentives.
From its beginnings in the 1990s, Vulcan has grown to
command the leading position in the New Zealand steel
distribution market. Its growth journey in Australia is at an
early stage and there is ample runway to take market share in
the fragmented Australian market from a very low base using
its proven strategy. And it is succeeding; it is already larger in
Australia than New Zealand. It has also more recently moved
into aluminium by acquiring Ullrich Aluminium, the leading
trans-Tasman player in this space, at a reasonable valuation.
This increases the company’s growth opportunities moving
forwards in a variety of ways.
We have been following Vulcan since its IPO in late 2021.
The company has been building an emerging track record
of performance as a listed company. The recent share price
weakness has provided the opportunity to initiate a position
for Kingfish.
Matt Peek
Portfolio Manager
Fisher Funds Management Limited

33
TOTAL SHAREHOLDER RETURN to 31 May 2023
MAY'S SIGNIFICANT RETURNS IMPACTING
THE PORTFOLIO
during the month
The remaining portfolio is made up of another 10 stocks and cash.
5 LARGEST PORTFOLIO POSITIONS as at 31 May 2023
RYMAN HEALTHCARE
+20
%
SUMMERSET GROUP
+12
%
VISTA GROUP
+8
%
INFRATIL
+7
%
FISHER & PAYKEL
HEALTHCARE
-16
%
INFRATIL
17
%
FISHER & PAYKEL
HEALTHCARE
17
%
AUCKLAND
INTERNATIONAL
AIRPORT
13
%
MAINFREIGHT
9
%
SUMMERSET
8
%
Share Price/Total Shareholder Return
$9.00
$8.00
$7.00
$6.00
$5.00
$4.00
$3.00
$2.00
$1.00
$0.00
Mar
2004
Share Price Total Shareholder Return
Mar
2005
Mar
2006
Mar
2007
Mar
2008
Mar
2009
Mar
2010
Mar
2011
Mar
2012
Mar
2013
Mar
2014
Mar
2015
Mar
2016
Mar
2017
Mar
2018
Mar
2020
Mar
2019
Mar
2021
Mar
2023
Mar
2022
1 Month3 Months1 Year3 Years
(annualised)
5 Years
(annualised)
Company Performance
Total Shareholder Return+3.8%(3.6%)(16.1%)+3.5%+9.7%
Adjusted NAV Return(0.6%)(0.5%)+3.9%+4.5%+8.5%
Portfolio Performance
Gross Performance Return(0.5%)(0.1%)+4.9%+6.1%+10.8%
S&P/NZX50G Index(1.7%)(0.7%)+4.5%+2.8%+6.4%
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 dividends (and other capital management initiatives) and after expenses, fees and tax,
»adjusted NAV return – the percentage change in the adjusted NAV,
»gross performance return – the Manager’s portfolio performance in terms of stock selection, before expenses, fees and tax, and
»total shareholder return – the return combines the share price performance, the warrant price performance, the net value of converting any warrants into shares, and the dividends paid to shareholders. It
assumes all dividends are reinvested in the company’s dividend reinvestment plan, and that shareholders exercise their warrants, (if they were in the money), at warrant expiry date.
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/
PERFORMANCE to 31 May 2023

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 a 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 June have no correlation with results historically achieved.
Kingfish Limited
Private Bag 93502, Takapuna, Auckland 0740
Phone: +64 9 489 7094
Email: enquire@kingfish.co.nz | www.kingfish.co.nz
4
Computershare Investor Services Limited
Private Bag 92119, Auckland 1142
Phone: +64 9 488 8777
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
MANAGEMENT
The Manager has authority
delegated to it from the Board
to invest according to the
Management Agreement and
other written policies. Kingfish’s
portfolio is managed by Fisher
Funds Management Limited. Matt
Peek (Portfolio Manager) and
Michael Bacon and Zoie Regan
(Senior Investment Analysts) have
prime responsibility for managing
the Kingfish portfolio. Together
they have significant 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 Board of Kingfish
comprises independent
directors Andy Coupe
(Chair), Carol Campbell,
David McClatchy and Fiona
Oliver.
Share Buyback Programme
»Kingfish has a buyback programme in place allowing it (if
it elects to do so) to acquire its shares on market
»Shares bought back by the company are held as treasury
stock
»Shares held as treasury stock are available to be utilised
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 Kingfish warrants on issue