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

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 2018-10-31 (rebased)

No chart data available

Performance per 2018-10-31

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  Fund Benchmark
1 month -6.6 % -7.6 %
3 months -6.5 % -6.3 %
This year 1.0 % -0.0 %
2015 11.6 % 11.0 %
2016 26.2 % 16.1 %
2017 12.6 % 7.7 %
1 year (on annual basis) 5.7 % 0.6 %
3 years (on annual basis) i 13.3 % 7.8 %
Since inception (on annual basis) i 12.3 % 10.1 %
Performance is shown after deduction of ongoing charges. 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 329.44 M 2018-10-31
Share class size
EUR 226.51 M 2018-10-31
Number of shares
137,106 2018-10-31
Net Asset Value i
EUR 1,647.16 2018-12-07
Morningstar rating â„¢

Fund characteristics per 2018-10-31

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  Fund Benchmark
Number of holdings 74 4333
Dividend yield i 2.25 % 2.02 %
Weighted average market capitalization i EUR 2,239 M EUR 2,850 M
P/E ratio i 9.48 15.39
Active share i 97.75 %
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. 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 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 2018-10-31

In October the Fund (I-class) was down 6.6% versus a 7.6% decline of the MSCI World small-cap index. This was the steepest monthly decline of the index since the start of the Fund. Life-to-date we have so far been able to, on average, outperform our benchmark in these down months. Despite some value style headwinds year-to-date the Fund showed a 1.0% performance versus a benchmark return of 0.0%. While we realize declines in the stock markets are always painful for our shareholders in the short-term, we also know from our experience that particularly in these markets an active manager can make a real difference. On average the small-cap universe declined 13% from the recent peak to through, however many stocks saw declines of 40-60%. We have added and will add to our portfolio stocks that are oversold and are focused to find a few new, high quality stocks that are heavily oversold.

Three top contributing stocks during the month of October were Dialog (+24%), Spirit Airlines (+13%) and Hitachi High Tech (+12%). Dialog, a European semiconductor company, saw its share price increase by 24% in October. The main reason for this was the announcement of a technology licensing agreement with Apple. We bought our initial position in Dialog on June 22 at EUR 13.8 per share. The stock had declined from a peak of EUR 50 per share in 2017. There was clearly a lot of uncertainty in June. However, what we saw fitted perfectly in the GSC playbook. We saw a company with leading positions in some niche parts of the semiconductor industry run by a strong and experienced management team. The balance sheet was rock solid with a lot of cash and no debt and the valuation significantly below intrinsic value. At the time of writing (November 6, 2018) the stock is up to a level above EUR 24 per share and in our view still undervalued. Spirit Airlines, a US ultra-low-cost carrier, was up 13% in October. The airline reported strong third quarter results and surprised the market with a better than expected guidance for Q4. Demand for air travel in the US is currently very strong, allowing airlines to pass higher jet fuel prices on to customers. In addition to a healthy fare environment, Spirit has executed well operationally and implemented various revenue initiatives that are starting to bear fruit. Hitachi High Tech's share price rose 12% last month, reversing some of the declines we have seen in previous months. Hitachi High Tech's fiscal Q2 results showed, as expected, some weakness in the semiconductor equipment division, while the medical equipment division continued to show a strong performance. Since 30% of the market cap is net cash the company's enterprise value is only 6x EBIT.

Negative contributors in October were Thermon (-14%), Trinity Industries (-20%), and Brunswick (-21%). Thermon reported quarterly results below expectations. While the company raised its guidance on revenues for the full year, the gross margin in the quarter was lower than anticipated by analysts. We believe this lower gross margin mainly reflects the lumpiness of the business and the large amount of mix effects. The quarterly results did not change our view on the business, its position within the value chain nor its (future) profitability. Trinity Industries reported quarterly results below expectations. Moreover, the company has been in the process of preparing a spin-off of part of its business as per 1 November, which created some noise. The share price has been partly rebounding in the first days of November. Brunswick's stock was down 21% in October. We view this sell-off as overdone. The company reported very strong Q3 results in its core Marine segment. The turnaround in the Fitness division takes longer than expected which is somewhat disappointing, but given the relatively small size of this division the impact on the stock price should be limited. The company also announced a leadership transition where the CEO Mark Schwabero will be succeeded by the internal candidate David Foulkes. We added to our position on the weakness.

 

The latest Quarterly you will find here.

Portfolio developments per 2018-10-31

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. 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 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 2018-10-31 (rebased)

No chart data available

Performance per 2018-10-31

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  Fund Benchmark
1 month -6.6 % -7.6 %
3 months -6.5 % -6.3 %
This year 1.0 % -0.0 %
2015 11.6 % 11.0 %
2016 26.2 % 16.1 %
2017 12.6 % 7.7 %
1 year (on annual basis) 5.7 % 0.6 %
3 years (on annual basis) i 13.3 % 7.8 %
Since inception (on annual basis) i 12.3 % 10.1 %
Performance is shown after deduction of ongoing charges. 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

Risk analysis (ex post) per 2018-10-31

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  3 years Since inception
Maximum drawdown i -10.21 % -12.98 %
Tracking error i 4.47 % 4.84 %
Information ratio i 1.23 -0.11
Beta i 1.00 0.85
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. 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 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 (2018-10-31)

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  Contribution i Performance i
Dialog Semiconductor 0.42 % 23.78 %
Spirit Airlines 0.29 % 13.25 %
Hitachi High Technologies 0.17 % 12.13 %
SmarTone Telecommunications 0.09 % 6.82 %
BE Semiconductor Industries 0.09 % 4.91 %

Bottom 5 contribution (2018-10-31)

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  Contribution i Performance i
Brunswick -0.58 % -20.15 %
Trinity Industries -0.56 % -19.83 %
Thermon Group -0.45 % -14.19 %
Western Forest Products -0.36 % -15.64 %
U.S. Silica -0.35 % -22.89 %

Geographic allocation (2018-10-31)

55.4 %
North America
29.5 %
Europe Middle East and Africa (EMEA)
11.1 %
Japan
2.9 %
Asia Pacific ex Japan
1.1 %
Other
Totaal
100 %
The cash position is included in ‘Other’.

Top 10 holdings (2018-10-31)

2.8 %
Thermon Group
2.8 %
Brunswick
2.7 %
LHC Group
2.7 %
Luxfer (US)
2.4 %
First Solar
2.4 %
Dena
2.3 %
Western Forest Products
2.2 %
Trinity Industries
2.1 %
Synaptics
2.0 %
Dialog Semiconductor
Totaal
24.4 %

Sector allocation (2018-10-31)

25.4 %
Industrials
22.2 %
Financials
14.5 %
Technology
11.0 %
Consumer goods
10.7 %
Consumer services
5.7 %
Basic Materials
5.6 %
Health Care
2.5 %
Oil & gas
1.4 %
Telecommunications
1.1 %
Other
Totaal
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. 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 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
0.70 %
Service fee i
0.20 %
Taxe d'abonnement i
0.01 %
Expected ongoing charges i
0,91 %

Other costs

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Upward swing factor i
0.30 %
Downward swing factor i
0.25 %
As of 1 January 2018 the swing factor has been adjusted from 0.30%/0.30% to 0.30%/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. 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 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
I i
Investor type
Institutional
Distributing
No
Benchmark i
MSCI World Small Cap Index
Investment category
Small-caps
Universum
Global Small- & Mid-caps
Inception date
2014-07-08
Domicile
Luxembourg
May be offered to professional investors only in
Belgium, Finland, France, Germany, Italy, Luxembourg, Norway, Sweden, Switzerland, The Netherlands, United Kingdom
UCITS status i
Yes
Status
Open-end i
Base currency
EUR
Share class currency
EUR
Management company
Kempen Capital Management N.V.
Custodian
J.P. Morgan Bank Luxembourg S.A.
Morningstar rating â„¢

Tradability

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Minimum subscription
Initial subscription €50,000, additional subscriptions €10,000
Listed
no
Subscription/Redemption Frequency
Daily
ISIN i
LU1078159883
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. 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 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. 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 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. 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 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.