Jupiter Green’s interim report, covering the six month ended 30 September 2015, shows the fund’s net asset value falling by 10.8% on a total return basis and a share price return of -11.5%. These figures compare to a -10.9% return on the MSCI World Small Cap Index.
The manager’s report says “The Company lost ground, underperforming the MSCI World Small Cap Index, but faring better than the environmental-focused FTSE ET100 Index.
In a world of low economic growth, companies have sought to expand their operations through mergers and acquisitions, and this benefited the portfolio during the period, with Latchways receiving a successful takeover bid. Elsewhere, high-welfare pork business Cranswick made solid progress after it announced market-beating results: the company’s acquisition of cooked poultry business Benson Park helped lift revenues, and despite this acquisition, the company paid down some of its debt. Meanwhile, a number of waste and recycling holdings made solid contributions to performance, including Veolia Environnement and Tomra Systems.
In contrast, a key impediment during the period was the poor performance of our US organic food holdings, United Natural Foods and Whole Foods Market, which suffered mainly due to concern about increasing competition in the market. Industrial recycling business Horsehead was also a disappointment after the company announced further delays to the start date of a new production facility. We sold out of our holding in this company after the end of the period.
The VW emissions scandal in late-September weighed on a range of holdings across the auto sector. These included ball bearing specialist SKF and engine efficiency companies BorgWarner and Johnson Matthey. The VW scandal has highlighted the challenges car manufacturer’s face in trying to meet complex global auto emissions regulation. The greater transparency on vehicle performance that the incident may produce could, in our view, lead to stronger demand for the products offered by some of these businesses. As discussed below, we added to some of our holdings in this area during the period.”
JGC : Jupiter Green interims in-line with global small cap index