BRM – February 2023 monthly update

1
A WORD FROM THE MANAGER
In January, Barramundi’s gross performance return was up 9.8%
and the adjusted NAV return was up 10.0%. This compares to
the S&P/ASX200 Index (70% hedged into NZ$) which was up
6.9%.
The ASX 200 Index started the year strongly. Globally, share
markets have been buoyed by an unexpected speedy re-opening
of China and a warmer European winter providing relief for the
European energy crunch. In addition, there have been further
signs recently that the post-pandemic increase in inflation may
have reached its zenith and is beginning to subside. In response
to this data, the market has tempered its expectations about the
number (and magnitude) of future interest rate increases that
might still be in store for central banks in this interest rate hiking
cycle. This has seen interest rates stabilise, with the Australian
10yr Government bond yield in fact falling from 4.05% to 3.55%
across the month.
This has allayed a key concern of the market and resulted in a
broad-based rally across the ASX. Apart from Utilities (-2.9%),
all sectors rose in the month. The consumer discretionary sector
(+10.3%) was the best performing sector, helped by positive
trading updates from some retailers in the month. Materials
(+10.2%) also led the market higher, assisted by China’s moves
to abandon its remaining domestic COVID restrictions.
Portfolio News
The subsidence of some inflationary pressures supported global
technology shares, with the tech-heavy NASDAQ index rising
+10.7% in the month. This dynamic also supported our software
and internet related holdings. Although there was no material
company specific news, Wisetech (+19.3% in A$), REA Group
(+13.4%), Carsales (+9.3%) and Xero (+9.3%) all rose strongly
in the month.
SEEK’s (+15.6%) share price similarly rose strongly and was also
helped by a continuation of strong job advertising volumes in
Australia in December.
Insurance claims software provider, Fineos (+26.2%), also
benefitted from this dynamic. It was also buoyed by the
acquisition by a private equity party of its closest listed peer, US
based Duck Creek Technologies. The acquisition price for Duck
Creek was at a substantial premium to Fineos’ current implied
valuation. This likely influenced Fineos’ share price performance
in the month.
During the month, Fineos also released its December quarter
results. Subscription revenues grew +19% over the same period
in 2021. Importantly the first Australian customer (QSuper) began
the migration from Fineos’ on-premise software to Fineos’ Cloud
based software. We expect other customers in Australia and NZ
to follow suit. This transition to the cloud is helpful for Fineos’
future revenue growth.
Credit Corp’s share price rose 15.1% in January, suggesting
a good earnings result was expected by the market. In early
February, Credit Corp missed investors’ expectations when
reporting earnings that were 30% below the same period in
FY22. However, the ‘miss’ is explained by the fact that Credit
Corp has grown a lot faster in its consumer lending book than
anticipated. Because it takes an up-front provisioning loss on new
lending originations, this faster growth inflated its provisioning
costs, thereby reducing its profitability over the past six months.
Similarly, its purchases of US Purchased Debt Ledgers (“PDL”)
was also higher than anticipated, remaining at record levels
over the six-month period to December. While this has no direct
accounting implications, recruiting and training the staff required
to collect these PDLs has an upfront cost, and it takes time for
people to become fully productive.
The faster growth in activity in both these divisions therefore
elevated the costs for Credit Corp in the period. But the revenue
benefits from this faster growth will only be realised over the
next few months. The company has also signalled that lending
activity over the next six months and US PDL purchases will
be markedly lower than the first half. Consequently, with a
lower lending provision headwind and improving US collection
productivity from its increased staffing levels, Credit Corp expects
a strong uplift in profitability over the remainder of the financial
year. After digesting the subtleties of this earnings result, the
market seemed satisfied that Credit Corp has sensibly sacrificed
short-term reported profitability in order to grow faster while the
opportunity existed within these divisions.
PWR Holdings (+14.2%) announced the acquisition of UK based
Bespoke Motorsport Radiators. This follows the acquisition of
UK based Docking Engineering in August 2022. Together the
businesses will expand PWR’s manufacturing capabilities and
capacity to service its existing and new European customers.
1
Share Price Discount to NAV (including warrant price on a pro-rated basis and using the net asset value per share, after expenses, fees and tax, to four decimal places).
MONTHLY UPDATE
February 2023
Warrant Price
$
0.00
$
0.70
Share Price
DISCOUNT
1
(2.7
%
)
as at 31 January 2023
BRM NAV
$
0.72

SECTOR SPLIT
as at 31 January 2023
KEY DETAILS
as at 31 January 2023
FUND TYPE
Listed Investment Company
INVESTS IN
Growing Australian companies
LISTING DATE
26 October 2006
FINANCIAL YEAR END
30 June
TYPICAL PORTFOLIO SIZE
20-35 stocks
INVESTMENT CRITERIA
Long-term growth
PERFORMANCE OBJECTIVE
Long-term growth of capital and
dividends
TAX STATUS
Portfolio Investment Entity (PIE)
MANAGER
Fisher Funds Management Limited
MANAGEMENT FEE RATE
1.25% of gross asset value
(reduced by 0.10% for every 1%
of underperformance relative to
the change in the NZ 90 Day Bank
Bill Index with a floor of 0.75%)
PERFORMANCE FEE
HURDLE
Changes in the NZ 90 Day Bank
Bill Index + 7%
PERFORMANCE FEE
10% of returns in excess of
benchmark and high water mark
HIGH WATER MARK
$0.73
PERFORMANCE FEE CAP
1.25%
SHARES ON ISSUE
272m
MARKET CAPITALISATION
$190m
GEARING
None (maximum permitted 20%
of gross asset value)
3
%
18
%
19
%

INDUSTRIALS
18
%
COMMUNICATION
SERVICES

HEALTH CARE
27
%
1
%
3
%

FINANCIALS
CASH &
DERIVATIVES
CONSUMER
STAPLES
4
%
Nanosonics (+12.6%) provided a strong trading update and
revised its earnings outlook up for the year. Revenues for the
six months ended December 2022 increased +35% on the prior
comparable period. The increase was largely driven by favourable
pricing of its Trophon units and related consumables. This is the
result of the successful completion of the transition to a more
direct sales model in its core North American market. Nanosonics
increased its full year revenue growth guidance from +20% to
25%, to +36% to 41%, and expects higher profit margins for
the year.
Resmed (+3.7%) reported a solid result for its December 2022
quarter in January. Revenue growth of 20% on a constant
currency basis (+16% actual) was slightly stronger than expected.
This was due to the on-going acceptance of the company’s
stopgap card-to-cloud devices in the US market and an improving
supply of communications chips that enabled the shipment of
more of its state-of-the-art cloud-connected devices. Earnings
growth of 4% lagged the top line increase. This was primarily
due to a contraction in gross margin reflecting shifts in the
Robbie Urquhart
Senior Portfolio Manager
Fisher Funds Management Limited
product mix, higher shipping costs and adverse FX movements.
None of these headwinds were surprising and we anticipate
they will moderate over coming periods. Resmed’s expectation
of sequential quarter by quarter revenue growth as component
supply constraints ease, and the prospect of improving margins,
suggest to us that healthy earnings increases should be delivered
for the remainder of its financial year.
Portfolio Changes
There were no substantive changes to the portfolio in the month.
2
INFORMATION
TECHNOLOGY
7
%
CONSUMER
DISCRETIONARY
MATERIALS

JANUARY’S SIGNIFICANT RETURNS IMPACTING
THE PORTFOLIO
during the month in Australian dollar terms
FINEOS
+26
%
WISETECH
+19
%
JAMES HARDIE
INDUSTRIES
+19
%
CREDIT CORP
+15
%
SEEK
+16
%
5 LARGEST PORTFOLIO POSITIONS as at 31 January 2023
WISETECH
7
%
CSL LIMITED
9
%
CARSALES.COM
6
%
AUB GROUP
5
%
CBA
5
%
The remaining portfolio is made up of another 21 stocks and cash.
Oct
2006
Oct
2007
Oct
2008
Oct
2009
Oct
2010
Oct
2011
Oct
2012
Oct
2013
Oct
2015
Oct
2016
Oct
2014
Share Price/Total Shareholder Return
Share PriceTotal Shareholder Return
$
0.00
$
0.50
$
1.00
$
1.50
$
2.00
$
2.50
$
3.00
$
3.50
Oct
2017
Oct
2018
Oct
2019
Oct
2020
Oct
2021
Oct
2022
1 Month3 Months1 Year3 Years
(annualised)
5 Years
(annualised)
Company Performance
Total Shareholder Return(1.4%)+0.3%(6.6%)+8.7%+14.1%
Adjusted NAV Return+10.0%+7.0%+3.1%+8.9%+11.2%
Portfolio Performance
Gross Performance Return+9.8%+7.6%+4.6%+10.9%+14.0%
Benchmark Index^+6.9%+9.5%+13.2%+6.9%+8.8%
PERFORMANCE to 31 January 2023
3
TOTAL SHAREHOLDER RETURN to 31 January 2023
^Benchmark Index: S&P/ASX 200 Index (hedged 70% to NZD)
Non–GAAP Financial Information
Barramundi uses non–GAAP measures, including adjusted net asset value, adjusted NAV return, gross performance return and total shareholder return. The rationale for using such non–GAAP measures is as follows:
»adjusted net asset value – the underlying value of the investment portfolio adjusted for dividends (and other capital management initiatives) and after expenses, fees and tax,
»adjusted NAV return – the percentage change in the adjusted NAV,
»gross performance return – the Manager’s portfolio performance in terms of stock selection and currency hedging before expenses, fees and tax, and
»total shareholder return – the return combines the share price performance, the warrant price performance, the net value of converting any warrants into shares, and the dividends paid to shareholders. It assumes
all dividends are reinvested in the company’s dividend reinvestment plan, and that shareholders exercise their warrants, (if they were in the money), at warrant expiry date
All references to adjusted net asset value, adjusted NAV return, gross performance return and total shareholder return in this monthly update are to such non–GAAP measures. The calculations applied to non–GAAP
measures are described in the Barramundi Non–GAAP Financial Information Policy. A copy of the policy is available at https://barramundi.co.nz/about-barramundi/barramundi-policies

Disclaimer: The information in this update has been prepared as at the date noted on the front page. The information has been prepared as a general summary of the matters covered only, and it is by
necessity brief. The information and opinions are based upon sources which are believed to be reliable, but Barramundi Limited and its officers and directors make no representation as to its accuracy or
completeness. The update is not intended to constitute professional or investment advice and should not be relied upon in making any investment decisions. Professional financial advice from a financial
adviser should be taken before making an investment. To the extent that the update contains data relating to the historical performance of Barramundi Limited or its portfolio companies, please note that
fund performance can and will vary and that future results may have no correlation with results historically achieved.
Barramundi Limited
Private Bag 93502, Takapuna, Auckland 0740
Phone: +64 9 489 7074
Email: enquire@barramundi.co.nz | www.barramundi.co.nz
4
Computershare Investor Services Limited
Private Bag 92119, Auckland 1142
Phone: +64 9 488 8777
Email: enquiry@computershare.co.nz | www.computershare.com/nz
ABOUT BARRAMUNDI
Barramundi is an investment
company listed on the New Zealand
Stock Exchange. The company
gives shareholders an opportunity
to invest in a diversified portfolio
of between 20 and 35 quality
growing Australian companies
through a single, professionally
managed investment. The aim of
Barramundi is to offer investors
competitive returns through capital
growth and dividends.
CAPITAL MANAGEMENT STRATEGIES
Regular Dividends
»Quarterly distribution policy introduced in
August 2009
»Under this policy, 2% of average NAV is targeted to be
paid to shareholders quarterly
»Dividends paid by Barramundi may include dividends
received, interest income, investment gains and/or
return of capital
»Shareholders who prefer to have increased capital rather
than a regular income stream have the opportunity to
participate in the company’s dividend reinvestment plan
(DRP)
»Shares issued to DRP participants are at a 3% discount
to market price
»Barramundi became a portfolio investment entity on
1 October 2007. As a result, dividends paid to New
Zealand tax resident shareholders have not been subject
to further tax
Share Buyback Programme
»Barramundi has a buyback programme in place allowing
it (if it elects to do so) to acquire its shares on market
»Shares bought back by the company are held as treasury
stock
»Shares held as treasury stock are available to be re-
issued for the dividend reinvestment plan
MANAGEMENT
The Manager has authority delegated
to it from the Board to invest according
to the Management Agreement and
other written policies. Barramundi’s
portfolio is managed by Fisher Funds
Management Limited. Robbie Urquhart
(Senior Portfolio Manager), Terry Tolich
and Delano Gallagher (Senior Investment
Analysts) have prime responsibility for
managing the Barramundi portfolio.
Together they have significant combined
experience and are very capable of
researching and investing in the quality
Australian companies that Barramundi
targets. Fisher Funds is based in
Takapuna, Auckland.
BOARD
The Board of Barramundi
comprises independent
directors Andy Coupe (Chair),
Carol Campbell, David
McClatchy and Fiona Oliver.
Warrants
»Barramundi announced a new issue of warrants on
27 April 2022
»Information pertaining to the warrants was mailed/
emailed to shareholders on 4 May 2022
»The warrants were issued at no cost to eligible
shareholders in the ratio of one warrant for every four
Barramundi shares held based on the record date of
13 May 2022
»The warrants were allotted to shareholders on
16 May 2022 and listed on the NZX Main Board from
17 May 2022
»The Exercise Price of each warrant is $0.89, adjusted
down for the aggregate amount per Share of any cash
dividends declared on the shares with a record date
during the period commencing on the date of allotment
of the warrants and ending on the last Business Day
before the final Exercise Price is announced by Barramundi
»The Exercise Date for the new warrants is 26 May 2023