KFL – August 2023 monthly update

1
A WORD FROM THE MANAGER
In July, Kingfish’s gross performance return was up
0.4% and the adjusted NAV return was up 0.3%. This
compares to the benchmark S&P/NZX50G, which
was up 1.2%.
Portfolio News
Contact Energy (+3%) delivered a positive finish to
its financial year, with its operating statistics showing
a record June operating performance. This has
resulted in a one-off uplift in expected earnings for the
year ended June 2023, ahead of earlier company
guidance. The result was enabled by strong hydro
inflows into its Clutha catchment which allowed for
more high margin hydro generation. Contact has also
continued to gain retail customers and fixed pricing
continues to track upward as it reflects previous large
increases in wholesale prices.
Infratil (-2%) announced the acquisition of Console
Connect, a provider of connectivity and networking
solutions, for US$160 million. This provides another
growth platform in the data and connectivity sector
with global potential. Its investment thesis is to
accelerate growth through investment in enhancing
the technology platform and sales team, whilst
reducing direct costs by progressively owning more
of the network (via taking stakes in international
submarine data cables). Console Connect is being
spun out of Hong Kong’s PCCW
2
, one of only a select
number of top tier telecommunications companies
globally. PCCW will maintain minority ownership
and allow Console Connect to use its network, which
is a source of competitive advantage. We like the
opportunity, and it continues Infratil's track record of
creating value in complex niche areas with strong
growth prospects.
Mainfreight (-4%) delivered a trading update for
the first quarter of its 2024 financial year, the three
months to the end of June. The update was weaker
than expected, with a deterioration in revenues
and profits below expectations due to weaker
freight volumes linked to economic conditions. The
Transport division held revenue at last year's level,
with rate increases offsetting volume pressures from
weaker trading conditions in the quarter. However,
lower utilisation of line haul services weighed on
gross margins and inflationary cost growth such as
annual wage increases and other fixed costs such
as insurance meant a sharp decline in weekly profits
(-36% versus the same period last year). Warehousing
revenue continued to grow (+15%) at a similar rate
to the most recent periods, however weekly profits
declined (-9%). In Air & Ocean international freight
forwarding, weekly profits had been reducing as
expected as ocean freight rates fell from recent
elevated levels towards more normal levels. However,
weekly profits reduced more sharply than we
expected, to $2.9 million per week, from $5.0 million
per week in the second half of the 2023 financial
year. The Mainfreight team are continuing to look for
ways to bolster profitability, including a hiring freeze
and efficiencies at the branch level. Heading into the
update, we thought that the share price was implying
a relatively pessimistic near-term earnings outcome
and was confirmed with the muted share price fall
subsequent to the trading update. There is nothing to
suggest the company's positive long-term prospects
have changed.
1
Share Share Price Discount to NAV (including warrant price on a pro-rated basis and using the net asset value per share, after expenses, fees and tax, to four decimal places).
2
Pacific Century CyberWorks Limited is a Hong Kong based information and communication technology (ICT) company.
MONTHLY UPDATE
August 2023
KFL NAV
$
1.40
$
1.33
Share Price
DISCOUNT
1
5.0
%
as at 31 July 2023
Warrant Price
$
0.0 7

2
KEY DETAILS
as at 31 July 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
$1.45
PERFORMANCE FEE CAP
1.25%
SHARES ON ISSUE
332m
MARKET CAPITALISATION
$442m
GEARING
None (maximum permitted 20%
of gross asset value)
SECTOR SPLIT
as at 31 July 2023
4
%
31
%
7
%
MATERIALS
HEALTH CARE
6
%
UTILITIES

CONSUMER
STAPLES
CASH
1
%
INFORMATION
TECHNOLOGY
4
%
Vulcan Steel (-7%) delivered a trading update, with
profits for the 2023 financial year to June coming
in below its guidance range. The company saw
weaker trading in its New Zealand steel distribution
operations in June. It cited that some projects are
not progressing as quickly as anticipated because of
uncertainty ahead of the general election in October.
Trading conditions in the other parts of the business
remain more reasonable (steel in Australia, stainless
and engineering steel, and aluminium). Positively,
the company called out its number of Active Trading
Accounts reached record levels in May, which means
it is continuing to gain customers and take market
share. This will become a positive tailwind when the
challenging market conditions stabilise.
Matt Peek
Portfolio Manager
Fisher Funds Management Limited
47
%
INDUSTRIALS

33
TOTAL SHAREHOLDER RETURN to 31 July 2023
JULY'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 July 2023
SUMMERSET GROUP
+7
%
DELEGAT GROUP
+7
%
VISTA GROUP
+6
%
EBOS GROUP
+5
%
VULCAN STEEL
-7
%
INFRATIL
17
%
FISHER & PAYKEL
HEALTHCARE
16
%
SUMMERSET
13
%
MAINFREIGHT
9
%
AUCKLAND
INTERNATIONAL
AIRPORT
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+0.6%+6.0%(8.6%)+1.4%+9.1%
Adjusted NAV Return+0.3%+1.5%+4.3%+1.9%+8.1%
Portfolio Performance
Gross Performance Return+0.4%+1.9%+5.5%+3.2%+10.3%
S&P/NZX50G Index+1.2%+0.3%+4.9%+0.9%+6.2%
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 July 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
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
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.
Warrants
»Kingfish announced an issue of warrants (KFLWH) on 20
June 2023
»Information pertaining to the warrants was mailed/
emailed to all shareholders on Tuesday 27 June 2023
»The warrants were issued at no cost to eligible
shareholders in the ratio of one warrant for every four
Kingfish shares held based on the record date of
5 July 2023
»The warrants were allotted to shareholders on 6 July 2023
and listed on the NZX Main Board from 7 July 2023
»The Exercise Price of each warrant is $1.37, adjusted
down for the aggregate amount per Share of any cash
dividends declared on the shares with a record date
during the period commencing on the date of allotment of
the warrants and ending on the last Business Day before
the final Exercise Price is announced by Kingfish.
»The Exercise Date for the warrants is 26 July 2024