Kempen (Lux) Global Small-cap Fund - Class A

Profile

Kempen (Lux) Global Small-cap Fund (the Fund) invests primarily in global smaller listed companies, with maximum market value at the time of the initial purchase of €4bn, or the highest value of any company included in the benchmark, whichever is greater. The benchmark is the MSCI World Small Cap Index. The Fund primarily aims to generate a better long-term return than the benchmark.

The portfolio construction process involves a disciplined end to end framework initially utilizing proprietary in-house stock filters screening for high quality and attractively valued stocks. Thereafter, fundamental in-house research is carried out to identify high conviction investment ideas. The end result is a portfolio of approximately 60 - 90 stocks, well diversified across all regions and sectors.

Management team

Jan Willem Berghuis, Maarten Vankan, Chris Kaashoek, Luuk Jagtenberg

Performance per 2019-03-31 (rebased)

No chart data available

Performance per 2019-03-31

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  Fund Benchmark
1 month 0.9 % 0.8 %
3 months 15.3 % 15.8 %
This year 15.3 % 15.8 %
2018 -1.2 % -5.8 %
1 year (on annual basis) 12.2 % 7.9 %
Since inception (on annual basis) i 13.7 % 9.0 %
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. As of 30 June 2018 a deviating Net Asset Value (NAV) is used for the calculation of the performance figures. This NAV is calculated based on closing prices of the Fund investments thereby deviating from the NAV which was originally issued and partly calculated based on snapshots (Asia & Pacific investments). The deviating NAV is used to make a better comparison with the benchmark, which is also solely based on closing prices of the investments.
More information can be found on the documents page of this fund

Key figures

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Total fund size
EUR 461.62 M 2019-03-31
Share class size
EUR 6.43 M 2019-03-31
Number of shares
226,480 2019-03-31
Net Asset Value i
EUR 29.55 2019-04-18

Fund characteristics per 2019-03-31

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  Fund Benchmark
Number of holdings 77 4329
Dividend yield i 2.44 % 2.04 %
Weighted average market capitalization i EUR 2,427 M EUR 3,040 M
P/E ratio i 15.08 16.55
Active share i 97.71 %
Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Market developments per 2019-03-31

During the month of March the Fund (I-class) was up 1.0% and the MSCI World Small-cap index was up 0.8%. The Fund (I-class) booked an outperformance versus the benchmark of 0.2% over the month, mostly driven by stock selection in the sector financials. For the first quarter of 2019, the Fund (I-class) is up 15.5% slightly underperforming the benchmark that was up 15.8%. The first quarter performance of the MSCI World Small cap Value index was 13.7% versus 17.8% for the MSCI World Small cap Growth index. Given our value tilt and our significant Q4 2018 outperformance we think the portfolio showed a solid performance in the first quarter. Looking forward it is evident that valuations levels are somewhat higher than three months ago, however due to our large universe we are still able to find very attractive (new) investment opportunities.

Three top contributing stocks during the month of March were Luxfer (+34%), Abercombie & Fitch Co (+28%) and Mizrahi (+9%). The share price of Luxfer was up almost 34% in the month. Luxfer published its decision to terminate the acquisition of Neo, which was initially announced in December. The market responded positively to this deal being terminated, as the proposed acquisition was considered sizable and risky. Later in the month, the shares reacted positively after a brokerage research note suggesting that Luxfer would be one of the new candidates potentially to be included in the Russel 2000 index. Abercrombie & Fitch Co's stock was up 28% in March after reporting strong Q4 results, particularly in the light of the weaker results reported by many competitors. We are impressed by the performance of the new management team and our conviction has gone up almost every single quarter for the last 2 years. In our view the market does not discount a complete turnaround. We still like the risk/reward of the stock at the current levels. Mizrahi’s share price was up 9% in March after the company settled a US tax case with the US authorities on the 12th of March. The company already largely provisioned for the US$195m settlement, which ended up slightly lower than anticipated. The bank also announced solid Q4 results in the last week of March. Mizrahi trades at just 10x 2019 P/E which is attractive given the growth profile of the company. Following the settlement the company now also plans to resume paying dividend in 2019 after it refrained from paying dividend in the past 3 quarters.

Negative contributors in March were Tenneco (-35%), American Equity Investment Life (-13%), and Enersys (-10%). Tenneco’s stock price was down 35% in March after the company reported a soft Q4 and disappointing guidance for 2019. In addition, global light vehicle production during the quarter was also softer than expected, led by weakness in China and Europe. Tenneco’s soft 2019 guidance led to particular anxiety in the stock market because of Tenneco’s material financial leverage subsequent to the transformative acquisition of Federal-Mogul. In our view, the market prices in a very high risk of a severe slowdown in the company’s end-markets, are higher than we think realistic at this point. In addition, we believe Tenneco’s debt level, though high, is manageable. We have retained a below-average position in the stock and will follow-up with Tenneco’s management next week. American Equity Investment Life’s share price dropped 13% in March on the back of a lower 10-year Treasury yield which dropped from 2.74% to 2.42%. A lower yield makes it more difficult for the company to achieve a spread on it fixed index annuities products. We believe American Equity is attractively valued at just 1.0x book value. In 2018 the company was in preliminary discussion regarding a potential transaction. We believe the company remains an attractive take-over candidate for private equity or industry peers. We met with the company in March at the Raymond James conference, where we also met many of our other US portfolio holdings. Similar to the prior month, Enersys (-10%) was a detractor to the performance in March. EnerSys, a global leader in battery solutions for electric forklift trucks and reserve power for telecom operators, reported disappointing quarterly results. This disappointment was, in our view, mainly explained by telecom operators delaying their 5G investments. While we anticipate increased demand for data and speed in telecom and broadband applications, we believe these investments are needed and hence the current depressed spending level is merely a temporary effect.

 

The latest Quarterly you will find here.

Portfolio developments per 2019-03-31

The Fund invests world-wide in smaller companies (small-caps). One attractive feature of small-caps is that they are generally monitored by a small number of analysts, which leaves plenty of opportunity to add value as active investors. When looking for new investment opportunities, screening is applied to reduce the investment universe to a manageable size of 500 companies. We screen for companies that are of above-average quality and that are attractively valued. Extensive fundamental analysis is done on both existing portfolio companies and new portfolio candidates. This includes analysis of the company’s public filings (like annual reports) and comprehensive dialogues with the management teams of companies that we invest in. For each stock we base our investment decision on an extensive investment case, which is supported by a proprietary financial model. ESG topics (Environmental, Social and Governance) are fully integrated in our investment process. The result is a well-diversified portfolio of 60-90 companies spread across sectors and regions. Many portfolio companies have leading positions in the niche markets in which they operate. The companies in the portfolio typically have robust balance sheets and high returns on capital employed, which indicates that these companies are structurally capable of increasing shareholder value via their operations. The portfolio has a more attractive price earnings ratio versus the benchmark.
Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Performance per 2019-03-31 (rebased)

No chart data available

Performance per 2019-03-31

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  Fund Benchmark
1 month 0.9 % 0.8 %
3 months 15.3 % 15.8 %
This year 15.3 % 15.8 %
2018 -1.2 % -5.8 %
1 year (on annual basis) 12.2 % 7.9 %
Since inception (on annual basis) i 13.7 % 9.0 %
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. As of 30 June 2018 a deviating Net Asset Value (NAV) is used for the calculation of the performance figures. This NAV is calculated based on closing prices of the Fund investments thereby deviating from the NAV which was originally issued and partly calculated based on snapshots (Asia & Pacific investments). The deviating NAV is used to make a better comparison with the benchmark, which is also solely based on closing prices of the investments.

Dividends

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Distributing
No
Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Top 5 contribution (2019-03-31)

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  Contribution i Performance i
Luxfer (US) 0.57 % 33.95 %
Abercrombie & Fitch 0.44 % 27.42 %
Mizrahi Tefahot Bank 0.15 % 8.79 %
U.S. Silica 0.15 % 18.30 %
Sanderson Farms 0.15 % 16.06 %

Bottom 5 contribution (2019-03-31)

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  Contribution i Performance i
Tenneco -0.52 % -34.11 %
American Equity Invt Life -0.23 % -13.06 %
Enersys -0.20 % -10.24 %
Cabot -0.17 % -9.96 %
Del Frisco's Restaurant -0.15 % -23.32 %

Geographic allocation (2019-03-31)

53.4 %
North America
28.6 %
Europe Middle East and Africa (EMEA)
12.2 %
Japan
3.1 %
Other
2.6 %
Asia Pacific ex Japan
Total
100 %
The cash position is included in ‘Other’.

Top 10 holdings (2019-03-31)

3.0 %
Brunswick
2.8 %
Dena
2.8 %
First Solar
2.5 %
Thermon Group
2.4 %
Fujitec
2.3 %
Western Forest Products
2.1 %
LHC Group
2.0 %
RenaissanceRe
2.0 %
Vesuvius
1.9 %
Abercrombie & Fitch
Total
23.9 %

Sector allocation (2019-03-31)

24.6 %
Industrials
23.5 %
Financials
12.5 %
Technology
10.0 %
Consumer goods
9.9 %
Consumer services
7.0 %
Basic Materials
5.1 %
Health Care
3.1 %
Oil & gas
3.1 %
Other
1.1 %
Telecommunications
Total
100 %
The cash position is included in ‘Other’.
Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Ongoing charges

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Management fee i
1.50 %
Service fee i
0.20 %
Taxe d'abonnement i
0.05 %
Expected ongoing charges i
1,75%

Other costs

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Upward swing factor i
0.30 %
Downward swing factor i
0.25 %
Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Share class details

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Share class
A i
Investor type
Private
Distributing
No
Benchmark i
MSCI World Small Cap Index
Investment category
Small-caps
Universum
Global Small- & Mid-caps
Inception date
2018-03-26
Domicile
Luxembourg
May be offered to all investors in
Belgium, Finland, France, Germany, Italy, Luxembourg, Norway, Spain, Sweden, Switzerland, The Netherlands
UCITS status i
Yes
Status
Open-end i
Base currency
EUR
Share class currency
EUR
Management company
Kempen Capital Management N.V.
Depositary and custodian
J.P. Morgan Bank Luxembourg S.A.

Tradability

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Minimum subscription
Initial subscription €1
Listed
no
Subscription/Redemption Frequency
Daily
ISIN i
LU1078120166
Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.
Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

KCM Vision

Kempen Capital Management is an asset manager with a long-term investment approach. We strongly believe in engaged shareholdership that benefits all stakeholders. As a long-term responsible investor, we firmly believe that active ownership and shareholder engagement contribute to positive change across the board.

Our KCM wide approach to responsible investment

To put our vision into action we engage with our investment targets on a wide array of strategic, financial, environmental, social and governance (ESG) topics. Our long-term investment worldview paired with thorough analysis and an experienced and diverse ESG team allow us to use both voting and engagement as means to consistently encourage positive change. Through this process of constructive engagement, we are able to contribute to the development of principles and standards of corporate responsibility within companies that we invest in. Our full voting records are available here.

Our fund approach to Responsible Investment

Exclude

Screen on controversies using MSCI ESG research

Exclude companies based on UNGC criteria

Exclude tobacco, weapons producers, pornography and gambling companies.

Avoid companies with high ESG risk in Quick Scan

Integrate

Form own ESG opinion and score in investment case (1-5)

Look for sustainable business models and practices

Require higher return for lower ESG score

Engage

Review ESG profile of portfolio on quarterly basis

Take responsibility by engaging with companies

Document all engagement and controversial voting items

Kempen (Lux) Global Small-cap Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Bleicherweg 7, CH-8027 Zurich, Switzerland. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents of the Fund are available at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future.