Portfolio Update November 2023
General update, portfolio movements, geographical and industry analysis, Supreme plc
Nothing on here is investment advice. Do your own due dilligence.
General
I removed undisclosed positions (only one, which I promised a friend I would not publicly discuss, at least for now) and dropped the percentages in the overview. I also, excluded delisted companies from the overview (currently: Pelatro plc and iEnergizer plc) but will post an update should something happen.
The portfolio of listed companies now has a really nice concentration of 10 companies with the top 3 representing around 55%. I have wanted to bring it down to this number for years but always succumbed to the temptation of adding a small, interesting opportunity here and there instead of really focussing on the best ideas.
Portfolio movements
Sold Chapters Group → relatively expensive but still interesting to follow if you like M&A compounders
Sold 4Mass → nice return, still cheap but like other investments more
Sold EROAD → management anti-shareholder + Volaris apparently decided to take the loss instead of going activist
Sold NZME → ad revenues already impacted by economic development, decided to sell out and redeploy in better opportunities
Increased Bravura → looks like Pinetree is really hands-on here. I think numbers will improve very soon
Increased Supreme → good update, see below
Bought Cab Payments → Crown Agents Bank has a long tradition as an FX/payments provider for emerging markets. Nicely growing, some problems in Nigeria at the moment. Very cheap valution.
Supreme plc update
Supreme recently published really good financials. In the 6 months ended end of September revenues grew by 55% yoy and EBITDA went from GBP 8.1m to 15m. FY revenues should now be above GBP 200m and EBITDA around GBP 30m. Based on the company forecast for the FY23/24 (which is usually quite conservative), Supreme currently trades at 4.4x EV/EBITDA or 7x P/E. For a growing, high quality company with a great capital allocator at the helm this still does not seem right to me.
Geographical and industry analysis of portfolio
I tend to be relatively agnostic (however, still mindful) of geography and industry. Nonetheless, I recently thought I would have a look at it.
My portfolio currently consists of UK 29%, Poland 22%, Singapore 19%, Australia 10%, Italy 8%, Slovenia 7%, France 3%, Germany 2%. This is a bit sad really as I would love to invest more in my home country. However, I just find there are a lot better opportunities abroad, especially in the UK currently.
About 50% of the portfolio is in the software space. The rest is sometimes a bit hard to define but generally for the most part in consumer goods. This is a bit closer to home as I also work in the software industry.
Dividends
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Current portfolio overview (by size of position):
SUTL Enterprise
Supreme plc
Sygnity SA
Bravura Solutions
RCS MediaGroup
Datalab Tehnologije (potential delisting soon)
itim Group plc
Cab Payments
Onlineformapro SA
bet-at-home.com AG
Doesn't this worry you?
https://www.gov.uk/government/news/government-drive-to-phase-out-smoking-and-tackle-youth-vaping-attracts-large-response
https://www.theguardian.com/world/2023/oct/04/vaping-and-de-nicotinisation-what-uk-can-learn-from-new-zealands-smoking-crackdown
"New Zealand’s law will also be accompanied by a slew of other measures to make smoking less affordable and accessible, including dramatically reducing the legal amount of nicotine in tobacco products and forcing them to be sold only through specialty tobacco stores, rather than corner stores and supermarkets."
I wonder what reducing nicotine in vapes will do, maybe it will increase consumption because people need to vape more to get their fix?