Kempen European High Dividend Fund NV - Class X

Profile

Kempen European High Dividend Fund N.V. (KEHDF) offers a diversified portfolio of European listed companies with an expected dividend yield of 2.75% 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 55 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. Share class X will only be available for distributors who submit orders on behalf of their clients, and who have been selected by the management company.

Management team

Jorik van den Bos, Joris Franssen, Joost de Graaf, Dimitri Willems, Luc Plouvier, Marius Bakker

Performance per 2021-03-31 (rebased)

No chart data available

Performance per 2021-03-31

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  Fund Benchmark
1 month 6.6 % 6.5 %
3 months 10.8 % 8.4 %
This year 10.8 % 8.4 %
2018 -7.8 % -10.6 %
2019 18.1 % 26.0 %
2020 -10.7 % -3.3 %
1 year (on annual basis) 40.1 % 35.3 %
3 years (on annual basis) i 4.0 % 7.3 %
5 years (on annual basis) i 5.7 % 7.5 %
Since inception (on annual basis) i 1.8 % 2.0 %
The results shown of the periods before 7 September 2016, the inception date of Kempen European High Dividend Fund N.V. class X, are those of Kempen European High Dividend Fund N.V. class N. 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 202.63 M 2021-03-31
Share class size
EUR 29.17 M 2021-03-31
Number of shares
4,315,032 2021-03-31
Net Asset Value i
EUR 6.82 2021-04-16
Transaction price i
EUR 6.81 2021-04-16
Morningstar rating â„¢
Morningstar Analyst rating
Bronze

Fund characteristics per 2021-03-31

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  Fund Benchmark
Number of holdings 52 434
Dividend yield i 3.66 % 2.33 %
Weighted average market capitalization i EUR 43,023 M EUR 72,427 M
P/E ratio i 13.29
Active share i 83.09 %
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 2021-03-31

The positive sentiment in the financial markets and the rotation towards value equities that started in November 2020 with the announcement of a working COVID vaccine, has continued in 2021. This trend has so far benefitted KEHDF, as March was another strong month for KEHDF in absolute terms, while it also slightly outperformed the broader market (as measured by the MSCI Europe Index). The market remains optimistic that during this year economies will normalize as an increasing amount of people receive a COVID vaccine. This despite the more negative short-term news that in particular many European countries were renewing lockdown measures due to increasing number of infections. Another trend supporting equity markets is the increased amount of new retail investors that is starting to invest. Reasons are the lack of investment alternatives and less opportunities to spend money on other items during the COVID crisis.

Also in March, value stocks outperformed growth stocks, which contributed to the relative outperformance of KEHDF. Stock selection was positive, while sector allocation was neutral. Stock selection within financials was very strong as one the best performers was Dutch bank ING. The shares hit a year high without company specific news, but banks in general benefited from the increase in interest rates. At the end of the month ING announced that it will close more than half of its Dutch bank branches. ING remains an attractively valued bank in the European context with a good return on equity and strong solvency.

We implemented the quarterly rebalance this month. We sold four positions completely, while adding three new investments to the portfolio. The main reason behind most of the disposals was a very strong share price performance. As a result of that, the valuation and dividend yield were not attractive anymore. Examples were ABB and Swatch. The three new holdings added were UK homebuilder Taylor Wimpey, French bank BNP Paribas and RELX. All these shares have an attractive valuation and the prospects of a growing dividend. RELX, formerly known as Reed Elsevier, is a global provider of information-based analytics and decision tools to academic institutions and specific industries like healthcare, insurance and legal. Furthermore, the company offers tools to identify fraud and cybercrime. Due to a significant degree of subscription revenues and the must-have nature of the information the business is viewed as defensive and offers steady growth. A small part of the business is related to exhibitions. This business is significantly impacted by COVID. We expect a recovery when markets re-open and business travel re-emerges.

Over the past few years, the equity market has favored companies with short-term earnings predictability rather than look at the potential to add value over the cycle. Given the uncertain outlook, part of that short-termism was certainly justified. This has resulted in a large valuation gap in the market as a handful of well-known names appear priced for perfection, while others look priced for a deep depression. We agree that several of those ‘quality’ companies were an attractive proposition, either because of their defensive nature or a long-term growth opportunity regardless of the current economic situation. However, in our view even the best company is not a good investment at any price. Since November last year, the valuation gap slightly narrowed as the vaccine greatly raised the odds of the economic situation normalizing in 2021. When the situation normalizes further this should be very positive for both the absolute and relative performance of KEHDF. The first signs of this have continued so far this year.

We currently expect a dividend yield of around 4% for KEHDF. This number is indicative and based on current figures with an outlook filled with uncertainties and therefore based on conservative estimates. Based on those estimates we foresee a 15-20% increase in dividends in 2021.

KEHDF still trades at an 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 on 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. A positive ESG development can add value to the investment case.

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 2021-03-31 (rebased)

No chart data available

Performance per 2021-03-31

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  Fund Benchmark
1 month 6.6 % 6.5 %
3 months 10.8 % 8.4 %
This year 10.8 % 8.4 %
2018 -7.8 % -10.6 %
2019 18.1 % 26.0 %
2020 -10.7 % -3.3 %
1 year (on annual basis) 40.1 % 35.3 %
3 years (on annual basis) i 4.0 % 7.3 %
5 years (on annual basis) i 5.7 % 7.5 %
Since inception (on annual basis) i 1.8 % 2.0 %
The results shown of the periods before 7 September 2016, the inception date of Kempen European High Dividend Fund N.V. class X, are those of Kempen European High Dividend Fund N.V. class N. 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 0.06
Ex-date last dividend
2021-02-26
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 2021-03-31

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  3 years Since inception
Maximum drawdown i -29.33 % -56.33 %
Tracking error i 4.90 % 3.32 %
Information ratio i -0.67 -0.07
Beta i 1.18 0.97
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 (2021-03-31)

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  Contribution i Performance i
AIB Group 0.35 % 20.17 %
ING Groep 0.34 % 15.41 %
Deutsche Post 0.25 % 13.78 %
A2A SPA 0.23 % 11.27 %
Telenor 0.22 % 11.89 %

Bottom 5 contribution (2021-03-31)

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  Contribution i Performance i
Wood Group -0.11 % -8.24 %
Wartsila OYJ -0.11 % -4.95 %
Rio Tinto -0.05 % -4.12 %
Hennes & Mauritz -B- -0.03 % -1.58 %
Valeo -0.01 % -1.32 %

Geographic allocation (2021-03-31)

23.3 %
United Kingdom
16.2 %
France
8.4 %
Germany
8.3 %
Netherlands
6.2 %
Switzerland
5.2 %
Italy
4.2 %
Spain
4.2 %
Belgium
4.2 %
Portugal
3.9 %
Sweden
3.3 %
Norway
2.9 %
Cash
2.3 %
Greece
2.0 %
Finland
1.7 %
Austria
1.6 %
Russia
2.0 %
Other
Total
100 %

Top 10 holdings (2021-03-31)

2.5 %
Sanofi
2.5 %
GlaxoSmithKline
2.5 %
Danone
2.3 %
ING Groep
2.3 %
Allianz
2.3 %
Nationale Nederlanden Group
2.3 %
Roche Holding
2.3 %
Hellenic Telecomm. Organization
2.3 %
Unilever PLC
2.2 %
Groupe Bruxelles Lambert
Total
23.3 %

Sector allocation (2021-03-31)

27.0 %
Financials
13.5 %
Consumer goods
12.0 %
Utilities
10.1 %
Oil & gas
8.5 %
Telecommunications
8.0 %
Industrials
7.9 %
Consumer services
7.3 %
Health Care
2.9 %
Other
2.9 %
Basic Materials
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.

 

SWING FACTORS

An overview of the current swing factors are available here.

Ongoing charges

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Management fee i
0.400 %
Service fee i
0.20 %
Expected ongoing charges i
0.60 %
Ongoing charges last financial year i
0.55 %
The Ongoing Charges Figure of the last financial year relates to 2019/2020.

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%

Performance fee

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Potential performance fee
0 % - 0.20 %
Current performance fee
0 % per March 2021
Performance fee last financial year
0.00 %
The level of the performance fee is determined on a montly basis, based on the performance relative to the benchmark and does not exceed 0,20%.

Please note that a performance fee is charged in case when the fund has positive return, which is more than the benchmark, but also when the fund has a negative return, which is less negative than the benchmark.
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
X
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
2016-09-06
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.
Management company
Kempen Capital Management N.V.
Depositary and custodian
BNP Paribas Securities Services S.C.A.
Morningstar rating â„¢
Morningstar Analyst rating
Bronze

Tradability

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Listed
no
Subscription/Redemption Frequency
Daily
ISIN i
NL0011843164
Details
Orders must be submitted via Vestima.
Class X of Kempen European High Dividend Fund N.V. will only be available for orders submitted via the Vestima platform. Share class X will only be available for distributors who submit orders on behalf of their clients, and who have been selected by the management company.
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.

Kempen's vision & mission

Kempen Capital Management is an asset manager that believes in stewardship and investment focusing on the long-term for the benefit of all stakeholders. Value creation is at the heart of the services we provide to our clients. We believe that being an engaged shareholder on environmental, social and governance (ESG) issues and retaining a long-term focus, is critical to helping our clients to preserve and create sustainable wealth that has positive real world impact and economic returns.

Kempen wide approach to responsible investment

We are committed to create sustainable alpha. The four pillars of our ESG-policy are:

  • ESG integration: Ensuring sustainability risks and opportunities are adequately considered in our investment analysis and processes.

  • Exclusion & avoidance: Not investing in companies involved in controversial activities or conduct.

  • Active ownership: Being responsible stewards of our clients’ capital and using our influence through engagement and voting to improve corporate behaviour on specific ESG issues and achieve positive change

  • Positive impact: Investing with an objective to achieve positive real world outcomes and impact, such as contributing to the UN Sustainable Development Goals.

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To put our mission and vision into practice we engage with our investee companies on a wide array of strategic, financial, and ESG topics. As an active owner we use our influence to improve our investee companies’ ESG performance.  This helps us address some of the most pressing and important sustainability issues facing business and the world. Our focus themes for engagement are: human rights, labour rights, climate change and governance.

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Through collaboration with other investors and industry think tanks we contribute to the development of principles and standards of corporate responsibility both at sector levels, as well as investee company level.Â

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Our full voting records are available here.

Climate change

As a long-term investor, we believe climate change represents a systemic risk facing the economy, society and environment. We want to consider the risks and opportunities this presents to our investments in the coming decades. We have therefore set a long-term commitment (2050), a mid-term ambition (2030) and short-term objectives (2025).

  • 2050 commitment: Net-zero investor.  Â
  • 2030 ambition: To align with a Paris Agreement pathway (listed and non-listed investments) and Dutch Klimaatakkoord.  Â
  • 2025 objectives: To align with a pathway towards achieving the Paris Agreement (listed investments) and Dutch Klimaatakkoord goals.[1]

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The Kempen climate change policy can be found here (under climate change policy).

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[1]We use carbon intensity as a metric to come to the pathway of net-zero emissions. As we care about the direction of travel and reduction of carbon emissions in the economy, it might be that the actual reducing trend may deviate from the suggested average trend line. The pathway is derived from the pathway of the EU Benchmarks.

Our fund approach to responsible investment

Kempen’s ESG policy is fully implemented in our fund’s investment process across the three relevant pillars of:  Exclusion, Integration and Active ownership.

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1. Exclusion

The fund follows the clear and transparent exclusion framework developed by Kempen. According to the framework the fund currently excludes companies involved in the production of controversial weapons and tobacco. In addition, we exclude pure coal players and pure players involved in tar sands, as these activities have an adverse impact on climate change. Furthermore, the strategy avoids investments in companies that structurally violate ESG criteria, with no willingness to improve. In total 13 companies are excluded from the fund’s European equity universe.

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2. ESG integration

ESG criteria are an integral part of the investment process. The aim is to incorporate material ESG issues in our fundamental analysis. With regard to climate change, we prefer to invest in companies that integrate climate risks and opportunities into their organisation, and are able to move towards a low-carbon economy. This means that portfolio managers perform an in-depth analysis of ESG data and material ESG risks and reflect them in the assumptions used in the valuation assessment. For example, as demonstrated in the chart on the right side, the ESG impact forms part of our Earnings Power Value (EPV) valuation model.

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3. Active ownership: Engagement

The aim of the engagements our fund participates in is to use our influence as a shareholder to encourage the companies we invest in to improve policies and practices in specific ESG issues. With regard to climate change, we engage generally and take a sector-specific approach for the most carbon-intensive companies and sectors (oil and gas, utilities), as these count for the largest part of the global carbon emissions. A successful engagement reduces the ESG risk and as a result unlocks value in the interest of our clients. In 2018 we held as a team over 200 company engagements on a range of topics. Â

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In order to lay out our guiding investment principles, we send a “welcome letter” to most of the companies we invest in. In this letter, we explain to the company why we made the decision to invest and what our long-term expectations are, including those in the areas of social and environmental responsibilities and corporate governance.Â

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Our fund also believes in the strength of collaborative engagement. Through cooperation with other investors and fund managers, we can increase the leverage of our engagement activities. In 2018, for example, we participated in the CIO Exchange Collaboration on Energy transition and, since last year we have been an active participant in the Climate Action 100+ initiative.

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Our engagement focus is on: climate change and energy efficiency, and corporate governance. For example recent activities include:Â

  • Shell: We engaged with senior management to set carbon targets with success as Shell announced that it will link its scope 1, 2 and 3 carbon targets to its remuneration. You can find the engagement factsheet here.

  • Severstal: We are monitoring Severstal’s health & safety efforts and encouraging the company to establish health & safety best practices that set an example to other Russian steel producers. As a result of the engagement, the company is working on a revised policy and process on labour. You can find the engagement factsheet here.

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3. Active ownership: Voting

Exercising our voting rights is also an essential part of the responsible investment philosophy of our fund. We analyse each vote on a case by case basis and often inform the company about our voting intention ahead of the meeting. Where there is a recommendation to vote against management, we ask the company to clarify their viewpoints. In 2018 we voted at a total of 104 shareholder meetings.

Risks

For more information about the mid and long term risks associated with the investments:

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Although Kempen Capital Management N.V.’s information providers, including without limitation, MSCI ESG Research LLC and its affiliates (the “ESG Parties”), obtain information from sources they consider reliable, none of the ESG Parties warrants or guarantees the originality, accuracy and/or completeness of any data herein. None of the ESG Parties makes any express or implied warranties of any kind, and the ESG Parties hereby expressly disclaim all warranties of merchantability and fitness for a particular purpose, with respect to any data herein. None of the ESG Parties shall have any liability for any errors or omissions in connection with any data herein. Further, without limiting any of the foregoing, in no event shall any of the ESG Parties have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.

ESG Report
Screening MSCI ESG research
Screening MSCI ESG research
UN global impact
ESG integration in the EPV valuation model
ESG integration in the EPV valuation model
Bron EN
disclaimer
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.