TIDMMAJE
Majedie Investments PLC
02 January 2024
Majedie Investments (MAJE)
02/01/2024
Results analysis from Kepler Trust Intelligence
Majedie Investments (MAJE) has released its annual results for
the year ending 30/09/2023, the first following the transfer of
portfolio management responsibilities to Marylebone Partners in
January 2023. Over the period, MAJE's NAV total return increased by
14.1%. The managers report that investment performance between
February 2023 (when they assumed investment management
responsibility) and the financial year-end was effectively
flat.
Over the course of the financial year, MAJE generated a share
price total return of 26.2%, which is reflected in the discount
narrowing from 25.8% to 18.7%. Subsequently, MAJE's discount has
narrowed to 12.1%, as at 29/12/2023.
The dividend policy has changed following the introduction of
the new investment policy which will see equal quarterly dividends
paid, equating to approximately 3% of NAV over the year - the board
hopes this will ensure greater clarity for shareholders.
Chairman Cristopher D Getley commented that MAJE's new
investment manager, Marylebone Partners, "believes that this is an
excellent juncture at which to be deploying capital." He also noted
that "the board expects the period ahead to be defined by
structurally higher rates, variable liquidity, more geopolitical
and cyclical volatility, and greater fundamental price dispersion
within markets", adding "this is precisely the sort of environment
in which a highly selective, fundamental approach that features
distinctive bottom-up investments should thrive."
Kepler View
Majedie Investments (MAJE) aims to provide investors with a
liquid endowment-like investment strategy. With the appointment of
the new investment manager, Marylebone Partners, in January 2023,
we believe MAJE now offers investors a truly differentiated
investment proposition. The managers' ambition over the long term
is to provide shareholders with an alternative to generic
investment strategies whose historic success depended on cheap
leverage, abundant liquidity, and rising asset prices. Although the
strategy is focused on equities, the managers have an unrestricted
multi-asset approach which could provide some stability and reduce
volatility over time. Although it is too early to analyse
performance, we think the portfolio includes some diversifying
allocations which we don't think many investors will have exposure
to, in addition to the prospect of new, alternative investment
ideas.
In our view, the narrowing of the discount since Marylebone took
over the management of the trust, reflects the interest in such a
differentiated strategy as investors have become more aware of what
MAJE now offers, and we note the incentive for the managers is to
maintain a narrow discount given the management fee is tied to the
market cap. We believe MAJE's mix of fundamental bottom-up ideas
with lower levels of cross-correlation to one another has the
potential to offer investors an investment proposition capable of
performing across the market cycle and acting as a complementary
investment for shareholders' often generic equity portfolios.
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