Perpetual’s publicly traded Forager Australian Shares fund shared some of the “bargains” it found when the COVID market panic was in full swing in March 2020.
The fund today reported an annual return of 87 percent for the full year to June 30, its best performance in 12 years, although its five-year return still lags 1.2 percent compared to the All Ordinaries accumulation index.
“British bank Virgin Money was only trading a quarter of the value of its tangible net assets after falling 70% as the pandemic set in,” note the annual results of Forager.
But British authorities acted quickly, and with the bulk of its loans in the form of less risky mortgages, Virgin bounced back quickly. Its shares reached $ 1.07 in March of last year and are trading at $ 4.02 today.
Forager shares are down 1.7 percent today at $ 1.74, from $ 1.39 at the start of the year. At a market low in March 2020, it announced a huge market buyback of 4.5 million shares, and repeated it with a more modest buyback in March 2021.
Other bargains include Star Entertainment and Skycity, which lost 60% of their market value, managed to bounce back even though international borders remained closed. Forager sold out in July 2021.
The main contributor to Forager’s bottom line was Mainstream Group, which never traded above 80c until October 2020, when it suddenly became a takeover target. Shares are at $ 2.75 today. He currently owns $ 23.2 million in Mainstream Group shares, the largest stake in his $ 201.6 million fund headed by Steve Johnson.
“With a number of recently sold underperforming investments and buyback offers received for some of the Fund’s largest investments, the fund has significant capital to deploy into new ideas or to take advantage of everything. market dysfunction, ”the fund told shareholders today. .
Meanwhile, NZME recorded a 180 percent gain.
“Few would have thought that NZME’s print, radio and online businesses would have rebounded so well under the clutches of COVID… Still valued as a business in perpetual decline, investors might one day wake up to find that overall revenues returned to steady growth. ”
Forgager noted a $ 20 million cost reduction, an increase in digital subscriptions and an online real estate portal helped offset the declines. However, shares exposed to Travel Experience Co and caravan rental company Apollo cost the fund in 2020.
Macmahon and Perenti Global, which recently returned to its March 2020 lows, pulled on the fund.