Kempen European High Dividend Fund NV - Class N

Profile

Kempen European High Dividend Fund N.V. (KEHDF) offers a diversified portfolio of European listed companies with an above-average dividend yield at the time the company purchased for the first time. KEHDF invests in companies that are listed or do business in geographical Europe including Eastern Europe and Russia. The portfolio contains around 40 investments, which are approximately equally weighted. The environmental, social and governance (ESG) criteria are incorporated in the investment process.

KEHDF primarily aims to generate a better long-term total return than the MSCI Europe Total Return Index (net dividends reinvested), comprising capital gains plus net dividends. This index consists of about 500 companies in 15 countries.

KEHDF pays its dividend on a quarterly basis and aims to pay all the received net dividends to the shareholders.

Management team

Joris Franssen, Luc Plouvier, Marius Bakker, Robert van den Barselaar, Reineke Davidsz, Roderick van Zuylen

Performance per 2022-04-30 (rebased)

No chart data available

Performance per 2022-04-30

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  Fund Benchmark
1 month 2.8 % -0.6 %
3 months -4.4 % -2.8 %
This year -2.4 % -5.9 %
2019 17.8 % 26.0 %
2020 -11.0 % -3.3 %
2021 24.6 % 25.1 %
1 year (on annual basis) 8.6 % 6.5 %
3 years (on annual basis) i 3.6 % 7.0 %
5 years (on annual basis) i 4.1 % 5.6 %
Since inception (on annual basis) i 2.1 % 2.3 %
The performance track-record of KEHDF is based on the Orange European Large Cap Fund until ultimo February 2007 including the corresponding benchmark (Dow Jones STOXX 50 Index). As of February 2007 the return data of KEHDF with the current benchmark are shown. Performance is shown after deduction of ongoing charges and including the reinvestment of dividend that has been paid out. The value of your investments may fluctuate. Past performance provides no guarantee for the future. The dividend distribution of KEHDF (ex-date 01-08-2018) is included in the NAV per 31 July 2018 and is therefore included in the performance figures of July.
More information can be found on the documents page of this fund

Key figures

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Total fund size
EUR 226.67 M 2022-04-30
Share class size
EUR 112.48 M 2022-04-30
Number of shares
15,983,321 2022-04-30
Net Asset Value i
EUR 7.08 2022-05-18
Transaction price i
EUR 7.07 2022-05-18
Morningstar rating â„¢
Morningstar Analyst rating
Neutral

Fund characteristics per 2022-04-30

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  Fund Benchmark
Number of holdings 47 428
Dividend yield i 4.70 % 2.93 %
Weighted average market capitalization i EUR 50,330 M EUR 89,250 M
P/E ratio i 9.74
Active share i 84.81 %
Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Developments per 2022-04-30

April was a positive month in absolute terms for KEHDF. In addition, the relative performance versus our investment universe (Morningstar Developed Europe Dividend Yield > 2.5% Index) was positive as the benchmark was up only modestly in April. KEHDF also outperformed the broader market index. The broader market index (MSCI Europe Index) was down, mostly driven by weak performance of the technology sector. The sector that contributed most to the absolute performance of KEHDF was the consumer staples sector (Danone did well). From a relative perspective, the financials sector performed well. Especially banks like Svenska Handelsbanken and ABN AMRO were in favor. The sector that detracted most from the absolute and relative performance was the materials sector (Rio Tinto declined modestly).

One of the best contributors was Repsol (+20% in April). This integrated energy company reported strong first quarter results. Production is increasing and refining utilization rates are moving up. These developments lead to higher than expected free cash flows. The company positively surprised investors by announcing additional share buy backs. Consensus earnings estimates for 2022 and 2023 have been rising for several months now . Despite the 67% strong run-up of the shares since the summer of 2021, the shares still only trade at 6 times 2023 earnings.

One of the detractors from performance was Rio Tinto, declining 6%. Reported production numbers fell short of expectations. However, the company is still confident that it will meet the full year targets. Driven by a strong mining cycle, Rio Tinto is generating large sums of free cash flow, which are allocated wisely. The shares currently trade at a price/earnings ratio of 7 times 2023 consensus earnings. The dividend yield of around 13% is highly attractive. Given the strong earnings and free cash flows, we believe that the dividend will be sustained for longer. Despite the strong 20% return over the past months, the shares are therefore still undervalued.

We have added Telefonica to our portfolio. Telefonica is active in fixed and wireless telecommunication across Europe (Spain, Germany and UK) and Latin America. They currently are market leader in their home market Spain, which is also their largest market (~30% of revenue). The Spanish market is seeing consolidation in the market, which we believe this will lead to a more stable pricing environment. Brazil is also a consolidating market, which should eventually lead to improving profits. Telefonica has lowered its debt levels by selling infrastructure and non-core assets. These developments are not yet fully reflected in the share price. The current dividend yield of around 7% is attractive.

To finance our purchase of Telefonica, we have sold our shares in Telenor. The Norwegian telco has operations in the Nordics and in South East Asia (~40% of the company). In the Nordics, the company’s operating performance shows signs of weakness while the recovery of its Asian business is not as strong as expected.

We currently expect a dividend yield of around 5.2% for KEHDF. This number is based on the consensus estimate of dividends paid out over the next 12 months. Based on those estimates the annual growth in dividends for KEHDF will be 7%. KEHDF still trades at a strong discount versus the market (the average valuation of all the holdings in KEHDF versus the broader equity market). Historically, this has led to a strong relative performance in the medium term. Also, the absolute
valuation of the strategy is compelling. We continue to focus on attractively valued companies, that have good capital discipline and generate positive cash flows through the cycle. In summary, the current environment offers the opportunity to buy a well-diversified portfolio with solid earnings power at an attractive valuation. In addition, ESG (Environmental, Social and Governance) is fully incorporated in our investment process.

Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Performance per 2022-04-30 (rebased)

No chart data available

Performance per 2022-04-30

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  Fund Benchmark
1 month 2.8 % -0.6 %
3 months -4.4 % -2.8 %
This year -2.4 % -5.9 %
2019 17.8 % 26.0 %
2020 -11.0 % -3.3 %
2021 24.6 % 25.1 %
1 year (on annual basis) 8.6 % 6.5 %
3 years (on annual basis) i 3.6 % 7.0 %
5 years (on annual basis) i 4.1 % 5.6 %
Since inception (on annual basis) i 2.1 % 2.3 %
The performance track-record of KEHDF is based on the Orange European Large Cap Fund until ultimo February 2007 including the corresponding benchmark (Dow Jones STOXX 50 Index). As of February 2007 the return data of KEHDF with the current benchmark are shown. Performance is shown after deduction of ongoing charges and including the reinvestment of dividend that has been paid out. The value of your investments may fluctuate. Past performance provides no guarantee for the future. The dividend distribution of KEHDF (ex-date 01-08-2018) is included in the NAV per 31 July 2018 and is therefore included in the performance figures of July.

Dividends

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Distributing
Yes
Last dividend
EUR 0.08
Ex-date last dividend
2022-02-28
Number of distributions per year
4
Dividend calendar
The dividend distribution of KEHDF (ex-date 01-08-2018) is included in the NAV per 31 July 2018 and is therefore included in the performance figures of July.

Risk analysis (ex post) per 2022-04-30

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  3 years Since inception
Maximum drawdown i -29.38 % -19.34 %
Tracking error i 6.81 % 3.73 %
Information ratio i -0.50 -0.06
Beta i 1.15 0.96
Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Top 5 contribution (2022-04-30)

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  Contribution i Performance i
Repsol 0.55 % 19.80 %
Danone 0.36 % 15.21 %
Svenska Handelsbanken 0.30 % 15.47 %
Hellenic Telecommunications Organization 0.29 % 12.20 %
Sanofi 0.24 % 9.37 %

Bottom 5 contribution (2022-04-30)

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  Contribution i Performance i
Rio Tinto -0.16 % -5.63 %
Deutsche Post -0.13 % -6.11 %
Equinor -0.12 % -4.05 %
Telefonica -0.11 % -6.32 %
Siemens -0.09 % -6.45 %

Geographic allocation (2022-04-30)

30.0 %
United Kingdom
17.8 %
France
10.5 %
Germany
8.8 %
Netherlands
4.8 %
Spain
4.7 %
Belgium
3.8 %
Sweden
3.7 %
Switzerland
15.9 %
Other
Total
100 %

Top 10 holdings (2022-04-30)

3.1 %
Repsol
2.9 %
Rio Tinto
2.9 %
GlaxoSmithKline
2.9 %
Equinor
2.8 %
Sanofi
2.8 %
Danone
2.7 %
National Grid
2.7 %
Shell
2.7 %
Technip Energies
2.7 %
RELX
Total
28.2 %

Sector allocation (2022-04-30)

24.6 %
Financials
13.4 %
Energy
11.6 %
Telecommunications
10.4 %
Health Care
9.8 %
Consumer Staples
9.1 %
Industrials
8.5 %
Consumer Discretionary
8.0 %
Utilities
2.9 %
Basic Materials
1.8 %
Other
Total
100 %
The cash position is included in ‘Other’.
Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Environmental and/or social characteristics promoted

The Kempen European High Dividend Fund (the “Fund”) falls under the scope of article 8 of the SFDR which means that the fund promotes environmental and/or social characteristics. This fund will invest in a broad range of companies, of which some will have sustainability objectives.

We commit to the goals of the Paris Agreement. This encompasses short-term objectives (2025), a mid-term ambition (2030) and a long-term commitment to be a net zero investor by 2050. By 2025, we aim to be aligned with a path to achieving the Paris Agreement and Dutch Klimaatakkoord. We follow the market reduction, which assumes a pathway in line with the EU Benchmarks.

Fund carbon emission targets

Morningstar sustainability rating

ESG Investment process

The promotion of environmental and/or social characteristics is achieved through the consistent implementation of the funds ESG policy. The ESG policy is fully implemented in our strategy’s investment process across the three relevant pillars of: Exclusion, ESG integration and Active ownership.

In the investment process we assess the ESG profile of a company. We look at each company on a case-by-case basis, taking into account material risks in a given industry in combination with the company’s respective risk exposure, practices and disclosure. This includes an assessment of good governance practices. The investee companies are rated for governance aspects using external research as well as making internal assessments. Furthermore, we look into the company’s exposure to past controversies and future ESG opportunities. Based on the fundamental ESG analysis we form an opinion on the quality of a company’s ESG profile.

Exclusion

The Fund applies exclusion criteria. These take into account international standards, such as UN Global Compact Framework, the OECD Guidelines for Multinational Enterprises, UN Guiding Principles for Business and Human Rights, and our Principles for Responsible Investment commitments. The Fund applies additional exclusion criteria based on product involvement and business conduct.

Key figures

  Kempen criteria Additional criteria
Business conduct
Human Rights
Labour
Environment
Anti Corruption
Product involvement
Controversial Weapons
Tobacco
Thermal Coal
Tar Sands
Adult Entertainment
Alcohol
Animal Welfare & GMO
Gambling
Power Generation Nuclear
Power Generation Carbon Intensive
(Un)conventional Oil & Gas Extraction
Weaponry
Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

 

SWING FACTORS

An overview of the current swing factors are available here.

Ongoing charges

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Management fee i
0.630 %
Service fee i
0.15 %
Expected ongoing charges i
0.78 %
Ongoing charges last financial year i
0.83 %
The ongoing charges figure of the last financial year relates to 2020/2021.

The service fee is determined annually on basis of the net asset value as of the last day of the previous financial year:
< or equal to EUR 200 million: 0.20%
Between EUR 200 million and EUR 700 million: 0.15%
>EUR 700 million: 0.10%
Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Share class details

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Share class
N
Investor type
Institutional & Private
Distributing
Yes
Benchmark i
MSCI Europe Total Return Index (calculated in Euro)
Investment category
High Dividend Equity
Universum
European equities
Inception date
1998-04-01
Domicile
The Netherlands
May be offered to all investors in
The Netherlands
UCITS status i
Yes
Status
Open-end i
Base currency
EUR
Share class currency
EUR
Administrator
BNP Paribas Securities Services S.C.A., Amsterdam branch
Management company
Kempen Capital Management N.V.
Depositary and custodian
BNP Paribas Securities Services S.C.A., Amsterdam branch
Morningstar rating â„¢
Morningstar Analyst rating
Neutral

Tradability

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Listed
yes, listed on the NAV Trading Facility of Euronext
Subscription/Redemption Frequency
Daily
ISIN i
NL0000293348
Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.
Kempen Capital Management N.V. (KCM) is the management company of Kempen European High Dividend Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.