Bill Bonner President, Portfolio Manager Evan Spiropoulos Managing - - PowerPoint PPT Presentation
Bill Bonner President, Portfolio Manager Evan Spiropoulos Managing - - PowerPoint PPT Presentation
Bill Bonner President, Portfolio Manager Evan Spiropoulos Managing Director, Portfolio Manager Martin Davies Managing Director, Portfolio Manager FORWARD-LOOKING STATEMENT DISCLAIMER This presentation may contain forward-looking statements
Brickburn Investment Funds Brickburn Investment Funds
FORWARD-LOOKING STATEMENT DISCLAIMER
This presentation may contain forward-looking statements including Management's assessments
- f future plans and operations, intentions, expectations of returns, growth, business prospects,
cash flow and earnings. No person should rely on these forward-looking statements because they involve known and unknown risks, uncertainties and other factors which are, in many cases, beyond the control of Management and may cause the Fund’s actual results, performance or achievements to differ materially from anticipated future results, performance or achievements expressed or implied by the forward-looking statements. Forward looking statements are based
- n certain assumptions, including, without limitation, the ability of the Fund to raise funds, locate
and complete desirable investments, the amount and timing of such investments and the outcome
- f such investments. While the Fund considers the assumptions it has utilized to be based on
available information, these assumptions may prove to be incorrect. Further, these forward- looking statements are made as of the date of this presentation, are not intended to give any assurance as to future results of the Fund and Management does not assume any obligation to update these statements. Prospective investors should carefully consider, among other things, the risk factors inherent in the business of the Fund (such as general and economic business conditions, volatility of markets, lack of a market for the Units, competition and other factors) before making an investment
- decision. Investors should review the funds prospectus and consult professional advise as it
pertains to there own investment objectives and risk tolerances.
Brickburn Investment Funds Brickburn Investment Funds
Willia liam D. Bonner er, , B.Comm
- mm,
, Finance Presid siden ent and Portfoli
- lio
- Manager
ager
- 31 years of capital markets experience, co-founder and President of Brickburn Asset Management Inc.. in 1997
- Chairman & Director WCSB OIL & Gas Royalty Interest LPs
- Co-managed the Network Capital 1997 Limited Partnership - 30% IRR over 7 years
- 14 years with Peters & Co. Limited as a Managing Director and Executive Committee Member
Evan an Spiropou
- poulos,
los, B.A. Economic
- nomics,
s, CFA Portf tfoli
- lio
- Manager/Ma
ager/Managin aging Direc ector
- r
- Founder, Chief Investment Officer of Sophina Capital Management from 2004 – 2012
- 17 years of retail investment management and business management
- Partner and Portfolio Manager with Hesperian Capital Management, and a manager of the Norrep Small Cap Fund 1999 – 2004
- Burns Fry/ Nesbitt Burns 7 years private client experience
- T. Marti
tin Davies, ies, B.A. Economic
- nomics
s Portf tfoli
- lio
- Manager/
ager/ Manag aging ing Direc ector
- r
- Managing Director, Portfolio Manager, Chief Compliance Officer of Brickburn Asset Management Inc. since 2004
- 33 years capital markets experience, including 22 years with Peters & Co. Limited as senior partner
- Former chairman and member of the Alberta District Council of the IDA
BRICKBURN INVESTMENT TEAM
Brickburn Investment Funds Brickburn Investment Funds INVESTMENT STYLE
- Focused fund with a maximum of 20 core investments
- Predominately Canadian, but investors should expect some global
securities
- Invest in companies that have Growth At a Reasonable Price (GARP)
- Bottom up “stock picking” style
- Long-term investment style with low turnover (15%)
- Small Cap is defined as Canadian companies with a market cap under $1.5
billion and $3 billion for global securities Since its formation in 1997, Brickburn Asset Management Inc. has been creating investor wealth through a unique and extensive blend of expertise in Canadian
- equities. Over the years, Brickburn has expanded its offerings to include a family
- f public mutual funds, private equity, and now Oil and Gas Royalty Income LPs.
Fund Objectives
Brickburn Investment Funds Brickburn Investment Funds BUY DISCIPLINE
Understand global market currents Determine how those currents will change corporate profit Identify the best
- f breed
companies to benefit Be patient, be early and pay low Monitor management to continue to execute
Brickburn Investment Funds Brickburn Investment Funds SELL DISCIPLINE
- The company fails to execute its business plan
- A fundamental change in the global market
- Position becomes greater than 10% of the portfolio
- Valuation remains significantly over valued
What makes us sell?
Brickburn Investment Funds Brickburn Investment Funds
Highlights:
- Outperformed
benchmark for 1, 3, and 5 year time periods
- We are in the top
quartile of funds in our category since inception
- We have 100% tax
efficiency
HOW WE HAVE DONE
Nov 5th. 2014 chart provided by Globefund
Brickburn Investment Funds Brickburn Investment Funds
8
Nov 5th. 2014 chart provided by Globefund
Highlights:
- Evan Spiropoulos took
- ver Spring of 2014
- Outperformed the
benchmark since taking
- ver
- 5.6% dividend yield
- Lower than market
volatility
- Highly tax efficient
Brickburn Investment Funds Brickburn Investment Funds HOW WE HAVE DONE – SMALL CAP
- Sept. 30, 2014
Column1 Fund Return Group Average NB WSC* TSX Completion TR Added Value
- ver TSX
Comp 1 Month
- 2.67%
- 4.68%
- 9.20%
- 5.30%
2.63% 3 Months
- 1.45%
- 3.17%
- 9.48%
- 3.40%
1.95% 6 Months
- 2.08%
0.72%
- 1.35%
3.04%
- 5.12%
1 Year 17.11% 15.27% 15.55% 17.67%
- 0.56%
2 Years 19.16% 15.62% 7.34% 11.54% 7.62% 3 Years 17.67% 15.61% 7.33% 11.30% 6.37% 4 Years 11.46% 10.01% 4.75% 7.96% 3.50% 5 years 12.36% 11.36% 9.24% 11.27% 1.09%
Since Inception (5/08)
8.34% n/a 1.85% 5.50% 2.84% Annual 2011
- 13.21%
- 16.93%
- 11.02%
- 7.85%
- 5.36%
2012 10.50% 6.83% 2.46% 4.75% 5.75% 2013 30.24% 22.82% 7.76% 12.22% 18.02%
Brickburn Investment Funds Brickburn Investment Funds HOW WE HAVE DONE – LARGE CAP
- Sept. 30, 2014
Fund Return Group Average TSX TR Value Added
1 Month
- 2.24%
- 2.83%
- 3.99%
1.75% 3 Months 2.95% 0.17%
- 0.59%
3.54% 6 Months 3.92% 4.86% 5.79%
- 1.87%
1 Year 18.17% 17.02% 20.38%
- 2.21%
2 Years 16.55% 14.18% 13.56% 2.99% 3 Years 10.13% 12.64% 12.07%
- 1.94%
4 Years 5.46% 9.22% 7.94%
- 2.48%
5 years 6.72% 9.42% 8.67%
- 1.95%
Since Inception (5/08)
- 1.64%
n/a n/a Annual 2011
- 12.48%
- 1.60%
- 8.71%
- 3.77%
2012
- 5.85%
7.53% 7.19%
- 13.04%
2013 22.49% 16.60% 12.99% 9.50%
Brickburn Investment Funds Brickburn Investment Funds OUR TOP TEN – SMALL CAP
Be Aerospa space ce Inc. WestJe tJet t Airlin lines es Ltd. Transf ansfor
- rce Inc
nc. ATS Automation mation Inc. Sierra erra Wireless less Absolut lute e Softwar tware WS WSP P Global l Inc. Descar artes es Systems ems AG Growth h Internation ernational al Inter ertap tape Polymer ymer
Sector Weightings
- Nov. 2014
Brickburn Investment Funds Brickburn Investment Funds OUR TOP TEN –LARGE CAP
Magna a Internation ernational al Met etha hane nex Corp rp Sun unLif Life Fina nancial ncial CSX X Corp rp AltaGas aGas Inc Royal yal Bank George rge Weston
- n
Raytheon theon Corp rp TransCan ansCanada ada Corp rp Spirit irit Aerosyst system ems Inc.
Sector Weightings
- Nov. 2014
Brickburn Investment Funds Brickburn Investment Funds WHAT HAS HAPPENED
- The bear market started in
2000 for non-commodity investors
- Real bull markets go up
500-700%
- The rally between 2001
and 2007 was just a bear market rally, not a bull market
- Bull markets last for
multiple years and start
- ut of investor apathy
S&P 500 Bear Market Bull Market
Brickburn Investment Funds Brickburn Investment Funds WHAT WILL SHAPE 2015
- 1. Increasing interest rates
- 2. Reversion to the mean in valuations between
Canada vs U.S. and Small vs Large Cap
- 3. The expansion of the Panama Canal
- 4. The Return of Europe
Brickburn Investment Funds Brickburn Investment Funds INCREASING INTEREST RATES
- Rising interest
rates do not necessarily mean declining markets
- In the 50’s and
60’s we had great market moves
Brickburn Investment Funds Brickburn Investment Funds RETURN TO THE MEAN
- The Small vs the
Large generally go in cycles, we are entering a positive Small Cap cycle
- For this current cycle
to start the Russell 2000 had to hold 1080 (it did)
Brickburn Investment Funds Brickburn Investment Funds CANADA VS U.S.
- After 2-3 years of
underperformance we are going to see certain Canadian markets come back
- Canadian Tech and
Industrials are cheap compared to the U.S. and now have a lower dollar
Brickburn Investment Funds Brickburn Investment Funds EXPANSION OF THE PANAMA CANAL
- Ship size increases from
4,000 TEU to 16,000 TEU (average ship size is currently 14,000 TEU)
- The savings to ship to
the U.S. Northeast is nearly 10%
- This will open up Gulf
Coast liquids sales
Brickburn Investment Funds Brickburn Investment Funds THE RETURN OF EUROPE
- 35% of northern
Europe’s GDP is based
- n Exports
- German Industrial
Production looks to have bottomed
- EU is getting aggressive
- n monetary policy
Brickburn Investment Funds Brickburn Investment Funds INVESTMENT IDEAS
- U.S. regional bank
focused in the Southeast
- Just announced the final
payment of TARP Funds
- Book value of $21/share
- Very profitable wealth
management business
- Region where it operates
is starting to turn around Synovus Financial Corp (snv.n)
Brickburn Investment Funds Brickburn Investment Funds INVESTMENT IDEAS
- Two of three business
units are running ahead
- f expectations
- Third unit is tied to U.S.
military spending which is expected to come back in 2015
- ExactEarth group
continues to be undervalued
- Company just reported
highest book to bill of 1.6x
- Activist shareholders
have a large position in the company ComDev International
Brickburn Investment Funds Brickburn Investment Funds INVESTMENT IDEAS
- Premier Defence company
in the world
- This will be a
consolidation year for Revenue and EPS
- Entering a new growth
cycle in missile technology
- World leader in shoulder
mounted missiles
- This is the key of our
growth expectations
- Defence is really a better
place than gold. Raytheon Company
Brickburn Investment Funds Brickburn Investment Funds INVESTMENT IDEAS
- Global leader in
hardware tracking for mobile devices
- Free cash flow yield of
- ver 10%
- 4% dividend yield
- $1.85 per share in cash
- 15% revenue growth
- ver next 2 years
- A dynamic new CEO with
a strong sales background Absolute Software Corp
Brickburn Investment Funds Brickburn Investment Funds INVESTMENT IDEAS
- Phase II of the
turnaround
- Continues to have cost
cutting opportunities ahead
- Input costs continue to
decline
- Either #1 or #2 in its
top products
- Exposure to the U.S.