Price and Performance

For the month of September, the Company’s Total Shareholder Return and NAV Total Return were -2.0% and -2.5% respectively, while the MSCI All Country World Index (ACWI) returned -2.1%.

Over the month, Salesforce.com Inc was the biggest contributor, with an absolute return of 4.3%. The global leader in Consumer Relationship Management technology increased its revenue forecasts for the fiscal year 2022 and released an outlook for FY2023 which exceeded analyst expectations. This was mainly driven by the acquisition of Slack by Salesforce in July, which boosted revenues for the company. The biggest detractor from performance this month was Facebook, with an absolute return of -8.7%. Tech stocks fell sharply towards the end of the month due to concerns over rising Treasury yields, which also explains the other major detractors including Alphabet and Microsoft.

The Company’s position in SunCor Energy (a Canadian integrated energy company) was eliminated due to the decision to exclude stocks with significant exposure to tar sands and thermal coal from the portfolio to reduce ESG risks. In addition, the positions in the kitchen supplier Howden Joinery, and information provider IHS Markit were exited as they approached their fair value estimates. Furthermore, the position in the biotechnology company Illumina was exited due to concerns around growing competition, and potential Federal Trade Commission interventions in future acquisitions. A position in Heineken was initiated, as it is expected to deliver attractive growth over our longer-term investment horizon. The company benefits from two key secular trends – the increasing demand for premium brands and the growth of middle-class consumers in emerging markets.

At the beginning of September, the portfolio was rebalanced to reallocate 2.5% of capital away from the value managers following the significant value rally in the market, and towards the quality style.