MLN - March 2025 Quarter Newsletter

1
Macro crosswinds drive sharp moves in growth
expectations and markets
Marlin ended the March quarter with gross performance down (7.9%)
and the adjusted NAV return was down (8.1%), compared with our
global benchmark which was down (3.5%).
Global stock markets and in particular US stock markets were
impacted by multiple macro crosswinds during the quarter.
First, exceptional US policy uncertainty around trade and federal
government spending sent policy uncertainty surveys to their highest
level in 50 years.
While this is unnerving for share-markets, it is unnerving for
companies too as they plan for the future, and this drove a sharp
re-pricing lower of US economic growth expectations. For example,
the real time Atalanta Fed “GDPNow” tracker shows the US already in
recession. While this is an inherently volatile series (attempting to track
GDP daily), we have only seen this sharp of a move lower in real time
growth indicators in the past 25 years during the COVID lockdowns.
In addition, the Department of Government Efficiency (DOGE), run
by Elon Musk is in “slash and burn” mode and that impacted several
sectors (healthcare & IT) that have the US Government as a customer.
On top of this, the ongoing China vs US AI arms race has caused the
market to question the return on the rapid investment in AI US tech
companies are making.
This caused global growth stocks (and especially US growth stocks)
to underperform global value stocks by 12%, the sharpest quarterly
move in 25 years.
Against this backdrop and considering this is the perfect storm for
our style, more than all the underperformance was explained by the
underperformance of growth stocks.
Overall, this extreme lack of clarity on US and therefore global policy,
exacerbated as I type by the “Liberation Day” reciprocal tariffs, plus
the speed of the global sector rotations, is throwing up opportunities.
However, it is also causing us to be extra vigilant.

Portfolio update
Tencent’s (+19%) sharp rally was kick-started by Chinese AI startup
DeepSeek’s release of an AI model in January that performed on
par with leading US AI models. This ignited investor enthusiasm for
the sector, and the Chinese tech companies launched their own AI
models shortly after. While there was some concern in the quarter
around Tencent ramping investment in AI, we view it as a positive.
With over one billion users on its Weixin social media app, Tencent
is arguably one of the best positioned companies in China to
benefit from AI. This massive user base offers unmatched potential
to monetise AI through multiple avenues including improved user
engagement and increased advertising revenue in its social media
and video products; consumer facing AI applications; and AI search.
Coupled with strong growth in the core gaming and advertising
segments, Tencent is executing well, despite a softer economic
backdrop in China. Sentiment was further boosted by a more
supportive stance from the Chinese government, with President Xi
Jinping meeting tech leaders during the month. This follows several
years of intense regulatory oversight on the private tech sector.
Boston Scientific (+13%) came out of the quarter relatively
unscathed against a backdrop of potential tariffs and proposed
cuts to US healthcare spend. While tariffs have raised concerns for
medical device companies that manufacture offshore, Boston did
not expect any material impact to the business, but that may change
with the 2nd April tariff announcements. The Trump administration
is also looking to take over $1 trillion of costs out of the Government
budget over the next 10 years. At nearly 30% of Government spend,
healthcare is in the crosshairs, particularly the Government funded
Medicaid program. If these cuts are made, expectations are that
hospitals may reduce large capital expenditures, however BSX has
little to no exposure here. Boston’s devices are typically used for non-
elective procedures that are less likely to be deferred.
Netflix (+5%) had a strong start to 2025, building on record-breaking
performance in late 2024. The company reported impressive
subscriber growth in Q4 2024, adding nearly 19 million new members
to surpass the 300 million subscriber mark. Notably, this growth was
robust even in highly saturated markets like the US and Canada,
underscoring the enduring appeal of the platform. In January, Netflix
implemented price increases for all three plans which is expected
to support operating profitability grow of 24% in 2025. Netflix’s
robust lineup of new content releases, coupled with its significant
increase in the content budget to $18 billion for 2025, further solidifies
its industry-leading content offerings and reinforces its strong
competitive position in the streaming market.
Mastercard (+4%) reported robust consumer spending earlier in
the quarter. This flew in the face a little bit of the market’s growing
concerns about US economic growth later in the quarter. Mastercard
continues to penetrate the global payments market as consumers
are increasingly using card payments over cash and cheques for
traditional consumer-to-business payments and is penetrating other
payment flows such as business-to-business.
Alphabet (-18%) and Amazon (-13%) shares were weak driven by
softer than expected reported cloud datacentre growth coupled
with larger than expected capital expenditure. While the weaker
cloud datacentre revenue was caused by capacity constraints due
to excess AI demand, sentiment soured on AI generally later in the
quarter, kick-started by the release of China based DeepSeek’s
efficient AI models. And the market is questioning the potential return
on this elevated capital expenditure.
¹
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).
as at 31 March 2025
1 January 2025 – 31 March 2025
MLN NAVDISCOUNT
1
$
0.923.2
%$
0.89
Share Price
QUARTERLY NEWSLETTER
$
0.00
Warrant Price

PERFORMANCE
as at 31 March 2025
Disclaimer: The information in this newsletter 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 newsletter 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 newsletter
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, New Zealand
Phone: +64 9 484 0365
Email: enquire@marlin.co.nz | www.marlin.co.nz
Headquarters Company
%
Holding
China
Tencent Holdings3.0%
France
Hermes International3.0%
Ireland
Icon3.8%
United Kingdom
Greggs Plc2.9%
United States
Alphabet4.8%
Amazon.Com8.0%
ASML Holding NV6.2%
Boston Scientific5.0%

Danaher Corporation5.4%
Dexcom Inc5.0%

Edwards Lifesciences Corp.2.7%
Floor & Décor Holdings5.3%
Gartner Inc3.7%
Intuitive Surgical Inc4.2%
Mastercard5.7%
Meta Platforms Inc3.9%
Microsoft8.4%
MSCI Inc3.4%
Netflix3.7%
Nvidia Corp2.0%
salesforce.com2.5%
UnitedHealth Group Inc3.3%
Zoetis Inc3.1%
Equity Total99.0%
New Zealand dollar cash0.5%
Total foreign cash1.1%
Cash Total1.6%
Forward Foreign Exchange(0.6%)

TOTAL100.0%
PORTFOLIO HOLDINGS
SUMMARY
as at 31 March 2025
COMPANY NEWS
If you would like to receive future
newsletters electronically please email us
at enquire@marlin.co.nz
Dividend Paid 28 March 2025
A dividend of 2.05 cents per share was paid to Marlin
shareholders on 28 March 2025, under the quarterly distribution
policy. Interest in Marlin’s dividend reinvestment plan (DRP)
remains high with 38% of shareholders participating in the plan.
Shares issued to DRP participants are at a 3% discount to
market price. If you would like to participate in the DRP, please
contact our share registrar, Computershare on 09 488 8777.
3 Months
3 Years
(annualised)
5 Years
(annualised)
Company Performance
Total Shareholder Return(4.5%)(2.6%)+11.2%
Adjusted NAV Return (8.1%)+3.7%+9.9%
Portfolio Performance
Gross Performance Return(7.9%)+5.8%+13.2%
Benchmark Index¹(3.5%)+8.3%+14.6%
1
Benchmark index : S&P Large Mid Cap/S&P Small Cap Index (hedged 50% to NZD)
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 expenses, fees and tax,
»adjusted NAV return – the percentage change in the adjusted NAV value,
»gross performance return – the Manager’s portfolio performance in terms of stock selection and
currency hedging 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 newsletter 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
marlin.co.nz/about-marlin/marlin-policies.
SIGNIFICANT RETURNS IMPACTING
THE PORTFOLIO DURING THE
QUARTER IN LOCAL CURRENCY
GREGGS
-38
%
SALESFORCE
-20
%
FLOOR & DÉCOR
-19
%
NVIDIA
-19
%
ALPHABET
-18
%
Sam Dickie
Senior Portfolio Manager
Fisher Funds Management Ltd
14 April 2025
Floor & Decor (-19%) shares were weak during the quarter as it was
caught up in President Trump’s tariff announcement (it imports 70%
of its flooring) and potential demand weakness as a result. Floor &
Decor’s superior value proposition (cheapest price, widest selection,
direct sourcing) has driven ongoing market share gains in a weak
housing market and should ensure it is in a better position than most
of its competitors.
Greggs (-38%) shares fell sharply in the quarter in sympathy with
the weakening broad UK consumer, driven by low consumer
confidence and a deteriorating economic growth outlook. While
Greggs has been taking market share in the UK food-to-go sector,
it is struggling to pass on higher costs driven by the expansion of its
food manufacturing plants and distribution in a weak consumption
environment.
.