KFL - discount to diluted NAV

[Sideshow Bob]

Kingfish delivers a record result - NZX, New Zealand’s Exchange

Results for announcement to the market

Name of issuer Kingfish Limited
Reporting Period 12 months to 31 March 2021
Previous Reporting Period 12 months to 31 March 2020
Currency NZ$
Amount (000s) Percentage change

Revenue from continuing operations $155,966 +1,918%
Total Revenue $155,966 +1,918%
Net profit/(loss) from continuing operations $142,713 +8,092%
Total net profit/(loss) $142,713 +8,092%
Interim/Final Dividend
Amount per Quoted Equity Security $NZ 3.60 cents per share
Imputed amount per Quoted Equity Security $NZ 0.00072607

Record Date 10 June 2021
Dividend Payment Date 25 June 2021

Current period Prior comparable period

Net tangible assets per Quoted Equity Security $1.77 $1.39

A brief explanation of any of the figures above necessary to enable the figures to be understood The financial statements attached to this report have been audited by PricewaterhouseCoopers and are not subject to a qualification. A copy of the auditor’s report applicable to the financial statements is attached to this announcement.
Authority for this announcement
Name of person authorised to make this announcement W.A. Burns
Contact person for this announcement W.A. Burns
Contact phone number (09) 4840352
Contact email address enquire@kingfish.co.nz
Date of release through MAP 27 May 2021
Audited financial statements accompany this announcement.

For immediate release:
27 May 2021

Kingfish delivers a record result

•Net profit after tax for year ended 31 March 2021 $142.7m
•Total shareholder return * +65.1%
•Adjusted NAV return (after expenses, fees and tax) ** 41.1%
•Dividend return *** +7.7% (13.48cps)

NZX-listed investment company Kingfish Limited (NZX:KFL) today announced a net operating after tax profit for the year ended 31 March 2021 of $142.7 million, in contrast with last year’s COVID-19 impacted profit of only $1.7 million. The result, driven by the recovery of key portfolio stocks, demonstrates the sharemarket recovery post the initial COVID pandemic shock, which had materially impacted Kingfish’s prior year March 2020 result.

Key elements of the FY21 result include gains on investments of $150.5m, dividend and interest income of $5.4m, offset by fees and expenses of $13.2m.

The Kingfish portfolio achieved a gross performance return**** before fees and expenses of +46.0% and an Adjusted net asset value (NAV) return** of +41.1%, compared to the S&P/NZX50G which reported +28.2% for the 12 month period. Total shareholder return* of +65.1% included share price increase, dividends paid, and the impact of the warrants that were exercised during the year.

In accordance with Kingfish’s quarterly distribution policy (2.0% of average NAV per quarter), the company paid a total of 13.48 cents per share to shareholders during the year ended 31 March 2021. On 27 May 2021, the board declared a dividend of 3.60 cents per share, payable on 25 June 2021 with a record date of 10 June.

Chair Alistair Ryan said “Kingfish has experienced a year of recovery after the COVID impacted performance of the previous financial year. The Manager’s focus on investing in quality and growing companies has again demonstrated the benefits of active investment management and rewarded shareholders with very strong returns.”

Kingfish’s Manager, Fisher Funds, will be paid a performance fee of $6.2m plus GST, as the Kingfish portfolio achieved a return in excess of both the performance fee hurdle (the change in the Bank Bill Index rate plus 7%) and the High Water Mark (the highest net asset value at the end of the previous financial year in which a performance fee was paid, adjusted for changes in capital). The performance fee earn rate was renegotiated down from 15% to 10% in FY19 and capped at 1.25%. The performance fee cap applies for FY21.

Senior Portfolio Manager Sam Dickie noted that “It is rare as investors that we get to test our investment process in very different market conditions over the course of a year. It was pleasing to see Kingfish outperform the benchmark index in each of the distinct market phases.”

For further information please contact:

Corporate Manager
Kingfish Limited
Tel: (09) 484 0352

[Sideshow Bob]

.............

[justakiwi]

This is why some of us are willing to break our own investing rules, and accept the high management/performance fees. As long as they continue as they have been, I’m a happy long term holder.

[winner69]

As of yesterday 17% premium to NAV

Must be a record high?

[Beagle]

I think that is a record. Just a thought...its really easy to replicate their KFL holdings and relative weightings and there are no overseas tax implications to worry about, unlike with replicating Barramundi and Marlin portfolio's which will involve purchasing shares on overseas bourses and considerable CFC and FIF accounting compliance work, (much harder).

That said, I can understand why people have stuck with them over the years, its easy diversification, tax free distributions of 2% per quarter, regular warrant issues, nice lunch at the annual meeting and last but certainly not least, decent market outperformance (even after fees and expenses) in recent years.

[tango]

I think that is a record. Just a thought...its really easy to replicate their KFL holdings and relative weightings and there are no overseas tax implications to worry about, unlike with replicating Barramundi and Marlin portfolio's which will involve purchasing shares on overseas bourses and considerable CFC and FIF accounting compliance work, (much harder).

That said, I can understand why people have stuck with them over the years, its easy diversification, tax free distributions of 2% per quarter, regular warrant issues, nice lunch at the annual meeting and last but certainly not least, decent market outperformance (even after fees and expenses) in recent years.

I have used that strategy about 20 years ago. I bought into MFT, RYM, FRE and a couple of other stocks that KFL were bullish on. Never regretted it. Sold MFT too early but that's life

The premium to NAV is eye watering but people want the 8% dividends and have nowhere else to park their money

I see SPK has an attractive div yield if that's what you are chasing

[alokdhir]

Expecting to see KFL new warrant issue announcement in coming qtr ...July to Sept . So now maybe the time premium starts expanding slowly to peak before it goes ex - warrant .

[justakiwi]

Can someone please help me understand this? The $0.15 DRP remainder from previous dividend + the $1.95 DRP remainder carried forward, equals more than the strike price. Shouldn’t they have given me 44 shares? Sharesight thinks so

8023F138-F6DD-472B-A865-9A2E2455A33C.jpg

[winner69]

Can someone please help me understand this? The $0.15 DRP remainder from previous dividend + the $1.95 DRP remainder carried forward, equals more than the strike price. Shouldn’t they have given me 44 shares? Sharesight thinks so

8023F138-F6DD-472B-A865-9A2E2455A33C.jpg

On the face of it seems that 44 shares

But I think it's all about calculations being done to 4 decimal points

Bloody maths eh

The 85.64 plus 0.15 from last time is 85.79 which entitles you to 43.9998 shares ...so 43 is what you get and the .9998 is carried forward to next time

If next DRP is 2.4o say you won't be getting that extra share then either .....

[justakiwi]

Clearly not a big deal as only one share, but in principle I think it kind of sucks. Thanks!

On the face of it seems that 44 shares

But I think it's all about calculatons being done to 4 decimal points

The 85.64 plus 0.15 from last time is 85.79 which entitles you to 43.9998 shares ...so 43 is what you get and the .9998 is carried forward to next time

If next DRP is 2.4o say you won't be getting that extra share then either .....