1. business and industrial
2. business operations
3. management
4. supply chain management

Ironbark GTP Global Equity Thematic Fund
Monthly Investment Report
March 2015
The Fund returned -0.06% gross (-0.14% net) for the month, underperforming the benchmark by 0.95% gross
(1.03% net)
Performance review and outlook
After a positive start to the year, the Fund lagged global markets in March, posting returns in line with its respective benchmark for the first
quarter. For the month, Supply Chain Dominance, Market Hedge and Bottom Billion were the primary detractors with Real-Life
Renaissance and Personalised Medicine being among the contributors.
The Supply Chain Dominance theme primarily detracted due to the Fund’s holdings in iron ore producer Vale and copper miner Freeport
McMoRan. These were offset by positive developments from Samsung Electronics and Westlake Chemical Corp. Vale shares dropped amid
continued decline in the iron ore price. Prices have been falling due to the continued deterioration in Chinese economic data and the lack
of visible restocking. Balance sheet concerns have come to the forefront given the decline in margins, reducing the free cash flow available
for deleveraging. Vale is working on a number of divestitures to raise cash this year, and its cost position has already started to improve.
Freeport shares were also affected by Chinese economic concerns and by falling US oil prices that adversely impacted the company’s
energy business. The investment manager believes that these near term demand concerns overshadow the continued downward revisions
in copper supply forecasts. The investment manager believes the market will move into a deficit in the second half of 2015, boding well for
future copper price rises. Elsewhere, Samsung Electronics outperformed after unveiling its latest smartphone, the Galaxy S6 Edge, which
highlighted the innovation potential within the company and the expectation for margin expansion. Westlake performed well as the
decline in US crude prices decelerated and the ethylene market tightened, with significant supply outages. Westlake should also benefit
from the impact of previously announced price hikes in the vinyls chain. The investment manager believes that the company is well
positioned from an earnings perspective, even in a low energy price environment and that its valuation has significant scope to expand.
Newmont Mining, the major gold miner and part of the Fund’s Market Hedge theme, declined during the month following profit taking
with market expectations of an interest rate hike in the US occurring sooner than previously expected following strong payroll numbers.
The shares have performed strongly since the beginning of the year, following the announcement of further quantitative easing by the
European Central Bank. Furthermore, Newmont has been reacting to lower gold prices by reducing costs. If gold stays at or above the
current range there is, in the investment manager’s view, upside to consensus estimates leading to good free cash flow generation, which
can reduce leverage further.
The Bottom Billion theme was negatively impacted by its holdings in Ambev, the Brazilian based brewer with operations in various
emerging countries. This was principally due to a weakening Brazilian Real although the share price in local currency terms continued to
rise. Management remains confident of reaching full year targets of mid to high single digit revenue growth, which could translate into
double digit EBITDA growth.
Performance
Fund size:
$689.0 million
Exit Price:
$1.9460
Inception date:
4 Oct 1996
1 month
3 months
6 months
Calendar year to date
Financial year to date
1 year
2 years (pa)
3 years (pa)
5 years (pa)
7 years (pa)
10 years (pa)
Since commencement of Fund* (pa)
Gross Fund Return (%)
-0.06
9.68
18.47
9.68
21.89
26.01
29.51
22.01
12.05
6.29
7.58
8.52
Net Fund Return (%)
-0.14
9.44
17.94
9.44
21.07
24.88
28.36
20.92
11.05
5.34
6.62
7.55
Benchmark (%)
0.89
9.57
18.51
9.57
25.31
29.11
31.89
24.44
14.32
7.77
6.48
6.35
Past performance is not an indicator of future performance. Gross performance figures are calculated using exit prices, pre-fees and reflect the
annual reinvestment of distribution. Net performance figures are calculated using exit prices, net of fees and reflect the annual reinvestment of
distribution. Retail investors should refer to net returns. If investing through an IDPS Provider, the total after fees performance return of your
investment in the Fund may be different from the information in this report.
*This figure represents the annualised performance of the Fund from the first full month of operation. Inception date: 4 December 1996.
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Top 10 holdings
Stock
Samsung Electronics Co
Ambev
adidas
Dow Chemical Company
Amazon.com Inv
Freeport-McMoRan Inc
Vodafone Group
Vale
UniCredit
Thermo Fisher Scientific
Country
South Korea
Brazil
Germany
United States
United States
United States
United Kingdom
Brazil
Italy
United States
Theme
Supply Chain Dominance
Bottom Billion
Real Life Renaissance
Supply Chain Dominance
Supply Chain Dominance
Supply Chain Dominance
Disequilibria
Supply Chain Dominance
Market-Implied Distress
Personalised Medicine
% of equity
2.91
2.66
2.64
2.61
2.47
2.33
2.16
2.14
2.12
1.89
(Data in AUD)
Key contributors and detractors for the month
Contributors
Detractors
Stock
Samsung Electronics Co
Ping An Insurance Group
UBS Group
Westlake Chemical Corporation
Starwood Hotels & Resorts
Adidas
Thermo Fisher Scientific
Julius Baer Gruppe
Roche Holding Ltd
JD.com Inc
Theme
Supply Chain Dominance
Bottom Billion
Disequilibria
Supply Chain Dominance
Real Life Renaissance
Real Life Renaissance
Personalised Medicine
Disequilibria
Personalised Medicine
Supply Chain Dominance
Contribution (%)
0.21
0.17
0.17
0.12
0.11
0.11
0.11
0.11
0.10
0.10
Stock
Vale
Freeport-McMoRan
Ambev SA Sponsored
Newmont Mining Corporation
Deutsche Post
Potash Corporation of Saskatchewan
Tullow Oil
Barrick Gold Corporation
LATAM Airlines Group
Vodafone Group
Theme
Supply Chain Dominance
Supply Chain Dominance
Bottom Billion
Market Hedge
Supply Chain Dominance
Global Agribusiness
Disequilibria
Market Hedge
Supply Chain Dominance
Disequilibria
Contribution (%)
-0.57
-0.28
-0.24
-0.17
-0.13
-0.13
-0.13
-0.10
-0.09
-0.09
(Data in AUD)
Theme distribution & contribution
Theme
Real Life Renaissance
Personalised Medicine
Disequilibria
Market-Implied Distressed
Future Of Money
Sufficiency
Talent & Ingenuity
Indian Ocean
Bottom Billion
Market Hedge
Global Agribusiness
Supply Chain Dominance
% of Fund
8.88
10.26
20.01
4.32
1.81
2.28
6.99
0.78
14.08
3.12
3.90
23.57
(Data in AUD, ex cash)
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Contribution to return (%)
0.39
0.37
0.18
0.16
0.06
0.05
-0.04
-0.06
-0.11
-0.19
-0.20
-0.60
Performance review and outlook (continued)
Furthermore, the investment manager sees significant opportunity to decrease costs in some areas. Ping An and China Life, both major
Chinese insurance companies, were among the positive contributors to performance after reporting strong growth in earnings, embedded
value and new business gains for 2014. The investment manager expects this to continue with structural changes between Mainland China
and Hong Kong trading to add to the catalysts.
The Real Life Renaissance theme benefited from its holdings in Starwood Hotels & Resorts and Moncler. A change of management at
Starwood raised expectations for a shift towards an asset light business model through the accelerated sale of hotel properties. Moncler,
the high end Italian winter outerwear manufacturer and retailer, outperformed after reporting strong earnings for last year and own store
sales well above market expectations.
The Personalised Medicine theme contributed to performance due to its holdings in Thermo Fisher Scientific and Intrexon, among others.
Thermo Fisher reported organic sales growth of 6% for quarter four 2014, the highest in the industry and the company’s management
expects further market share gains based on its product portfolio and geographic reach. Intrexon, the provider of synthetic biology
services, announced an exclusive strategic collaboration and license agreement to develop and commercialise particular targeted cancer
therapies with Merck Serono, the biopharmaceutical business of Merck KGaA. Merck Serono agreed to pay Intrexon $115 million upfront,
with potential for a further $826 million in respect of development, regulatory and commercial milestones and tiered royalties on product
sales.
Geographical distribution
Country
Austria
Bahrain
Belgium
Bermuda
Brazil
Canada
Chile
China
Colombia
Denmark
Egypt
Finland
France
Germany
Hong Kong
India
Ireland
Israel
% of Fund
0.29
0.20
0.00
0.90
7.63
2.51
0.29
5.85
0.38
0.00
0.27
0.00
0.23
11.19
0.00
0.99
0.00
0.00
% of Benchmark
0.08
0.00
0.52
0.00
0.00
3.78
0.00
0.00
0.00
0.66
0.00
0.35
3.88
3.80
1.25
0.00
0.14
0.24
Country
Italy
Japan
Korea
Netherlands
New Zealand
Norway
Peru
Philippines
Portugal
Singapore
South Africa
Spain
Sweden
Switzerland
Turkey
United Kingdom
United States
Cash
% of Fund
3.19
0.00
3.63
0.92
0.00
0.00
0.75
0.50
0.00
0.00
1.25
0.00
0.68
6.51
0.29
6.77
43.14
1.64
% of Benchmark
0.93
8.86
0.00
1.09
0.06
0.25
0.00
0.00
0.06
0.58
0.00
1.42
1.23
3.69
0.00
7.88
59.25
0.00
(Data in AUD)
Important information
Contact details
Client Services:
1800 034 402
Client.Services@
ironbarkam.com
www.ironbarkam.com
Issued by Ironbark Asset Management Pty Limited ABN 53 136 679 420 AFSL 341020 (“Ironbark”). Data as at 31 March 2015. This document is
not an offer of securities or financial products, nor is it financial product advice. As this document has been prepared without taking account of
any investors’ particular objectives, financial situation and needs, you should consider its appropriateness having regard to your objectives,
financial situation and needs. The Ironbark GTP Global Equity Thematic Fund is issued by Ironbark Asset Management (Fund Services) Limited
ABN 63 116 232 154 AFSL 298626. To acquire units in the Fund, complete the application form that accompanies the current PDS, which you
can obtain from www.ironbarkam.com or by calling client services on 1800 034 402. You should consider the PDS in deciding to acquire or to
continue to hold units in the Fund. Although specific information has been prepared from sources believed to be reliable, we offer no
guarantees as to its accuracy or completeness. The information stated, opinions expressed and estimates given constitute best judgement at
the time of publication and are subject to change without notice to you. Consequently, although this document is provided in good faith, it is
not intended to create any legal liability on the part of Ironbark or any other entity and does not vary the terms of a relevant disclosure
statement. Past performance is not an indicator of future results. All dollars are Australian dollars unless otherwise specified.
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