1909 Ausbil Unitholder Report PDF

Ausbil Funds Ausbil Investment
Management Limited
ABN 26 076 316 473
ACN 076 316 473
Unitholder Quarterly Report AFSL 229722
September 2019
Economic review
and outlook
Economic Review
The quarter ending September saw the recessionary mindset that gripped markets unwind with
bond yields rising and equities outperforming. There was significant movement in monetary policy
and a first response in fiscal policy aimed at addressing softer growth. The major central banks
deployed comprehensive monetary easing measures to offset the risks from increased uncertainty
and trade disputes. Global fiscal policy saw the Dutch government announce an expansionary
package for 2020, a significant departure from years of austerity. India surprised with a US$20bn
corporate tax cut, and the German deputy finance ministry may consider reviewing fiscal plans
through to 2023 should economic conditions deteriorate.
Geopolitics remained a major concern. The UK High Court ruled unanimously that PM Johnson’s
decision to prorogue parliament for five weeks was unlawful. In the final week, US House speaker
Pelosi announced a formal impeachment inquiry into President Trump amid allegations that he
pressured Ukraine to investigate former Vice President Biden and his son.
Trade uncertainty continued. President Trump announced that the US and Japan have reached an
initial trade agreement. The World Trade Organisation ruled in favour of the US against the European
Union for illegal subsidies granted to Airbus aerospace industries. US Treasury Secretary Steven
Mnuchin said principal level China trade talks will resume in the second week of October. China’s
Customs Tariff Commission announced a number of US goods imports that would be exempt from
the 25% tariff, with the government encouraging companies to buy more US farm products.
The US Federal Reserve cut rates by 25 basis points for the second consecutive time, taking the
Fed Funds rate down to 1.75%-2%. The Fed also lowered the rate on excess reserves by 30bps
to 1.80%. On forward guidance, the Fed’s dot plot showed the current Fed funds rate unchanged
through the remainder of 2019 and 2020.
The European Central Bank announced five new monetary policy measures despite opposition from
France, Germany and the Netherlands regarding the re-starting of quantitative easing at €20bn per
month. President Draghi, in his post meeting press conference, called for fiscal assistance going
forward, stating that “governments with fiscal space should act in an effective and timely manner.”
The People’s Bank of China reduced the prime interest rate to 4.20% from 4.25% and lowered the
required reserve ratio by 50bps for all banks, and by 100bps for urban commercial banks, which is
estimated to release 900 billion yuan (US$126bn) in liquidity.
The Reserve Bank of Australia lowered the cash rate to a historic low level of 0.75%, reflecting the
pressures of the global trend to lower interest rates, and to provide greater confidence in a “gentle
turning point” in the economy.
2 Ausbil Unitholder Report l September Quarterly 2019

Economic review and
outlook
Economic Outlook
The US/China diplomatic standoff sees any trade agreement in a state of flux, potentially up until
the November 2020 US Presidential election. A global easing cycle is underway to counter the risks
of uncertainty from further undermining global investor confidence, reducing trade volumes and
delaying capital investment plans. The macro-environment is supportive of global growth recovering
to trend levels as cash rates and bond yields remain lower for longer, whilst inflationary expectations
persist well below official target levels.
Against the backdrop of slowing momentum in global growth, we see the US Federal Reserve
cutting rates to curtail a recessionary mindset and to normalise the inverted yield curve. We are
forecasting, at a minimum, three rate cuts (75 basis points), taking the Fed funds rate down to the
range 1.50%-1.75% from a starting point of 2.25%-2.50%. The Fed has also elected to hold a
much larger balance sheet to assist with reserve and liquidity management. The European Central
Bank and the Bank of Japan will both maintain easier monetary conditions for a much longer period.
We expect US GDP to slow to 2.2% this year, then expand towards its long-run trend of 2% in both
2020 in 2021. Eurozone growth slows to 1.3% with a downside risk, before recovering to its trend
pace of 1.5% in both 2020 and 2021. Japan slows to 0.9% this year, and October’s increase in the
consumption sales tax, sees growth average 0.6% in both 2020 and 2021. China’s response to
US tariffs with aggressive stimulus measures should see growth at the low end of the official target
range at 6.1% out to 2021.
The Australian economy is in a record 28th year of uninterrupted growth, with monetary and fiscal
policy stimulus recently injected. GDP slows to 2.1% this year before recovering to 2.7% in 2020
and 2.9% in 2021. The Reserve Bank has factored into its outlook the household income tax cuts
and successive reductions in the cash rate to 0.75%. At this stage, further interest rate cuts are
likely, and the implementation of “quantitative easing” as a policy tool cannot be ruled out. Forward
policy guidance repeated that an extended period of low interest rates will be required, and that
the Bank stands ready to ease further in meeting their goals of full employment and achieving their
inflation target. The Australian dollar is anchored, for now, at around 67 cents, with a downside
break likely should rate cuts continue.
Downside risks to the global economy include prolonged trade uncertainty, instability in the Euro
area triggered by Brexit, a tightening of financial conditions impacting growth, and geopolitical
uncertainty. The Australian economy’s downside tail risks, from the consumer and the housing
sectors, have been reduced with the lowering of the cash rate, income tax cuts, ongoing spending
on infrastructure, signs of stabilisation in some established housing markets, and through an
improving outlook for the resources sector.
Ausbil Unitholder Report l September Quarterly 2019 3

Performance details and
unit prices
Ausbil Australian Active Equity Fund
Period Fund Benchmark** Out/Under

Return* % Performance
% %
3 months 4.82 2.55 2.27
6 months 11.66 10.80 0.86
FYTD 4.82 2.55 2.27
CYTD 25.80 22.90 2.90
1 year 9.20 12.57 -3.37
3 years pa 12.27 11.85 0.41
5 years pa 9.38 9.55 -0.17
7 years pa 11.67 10.89 0.78
10 years pa 7.96 8.05 -0.09
15 years pa 9.66 8.67 0.99
20 years pa 10.25 8.73 1.52
Since inception pa 10.32 8.50 1.82
Date: July 1997
* Returns are after fees but before taxes.

** S&P/ASX 300 Accumulation Index.
Price* $ Distribution CPU

30 September 2019 3.783603 0.000000
* Redemption Ex-dist price.
Fund performance for the quarter ending September 2019 was +4.82% (net of fees) versus
the benchmark return of +2.55%, as measured by the S&P/ASX 300 Accumulation Index.
Over the quarter, at a sector level, the Fund’s overweight positions in the Consumer Staples,
Financials and Health Care sectors contributed to relative performance. The underweight
positions in the Energy, Industrials, Information Technology and Utilities sectors also added
value. Conversely, the overweight positions in the Materials and Communication Service
sectors detracted from relative performance. The underweight positions in the Consumer
Discretionary and Real Estate sectors also detracted value.
At a stock level, the overweight positions in Lendlease, Independence Group, JB Hi-

Fi, Treasury Wine Estates, Santos, QBE Insurance, National Australia Bank and Aurizon
Holdings contributed to relative performance. The nil positions in Woodside Petroleum and
Amcor also added value. Conversely, the overweight positions in Iluka Resources, BHP, Rio
Tinto, Goodman Group, Brambles, Aristocrat Leisure and Telstra detracted from relative
performance. The nil positions in Wesfarmers, Coles and James Hardie also detracted
value.

unit prices
Fund activity
Major Purchases and Sales
Purchases Sales
Altium Dexus Property Group
Lynas Downer EDI
Ramsay Health Care Link Administration
Stockland ResMed Inc
South32
The a2 Milk Company
Over the quarter, the Fund purchased holdings in Altium, Lynas, Ramsay Health Care and Stockland.
The positions held in Dexus Property Group, Downer EDI, Link Administration, ResMed Inc, South32
and The a2 Milk Company were sold during the period.
Altium (ALU) is an Australian multinational software corporation that focuses on electronic design
systems for printed circuit board (PCB) design and embedded system development. The pursuit of
PCB market dominance by 2025 is a strong focus for ALU in order to fulfil the vision of transforming
the collaboration within the electronics industry. The company is rolling out new products, pursuing
strategic partnerships and executing an M&A strategy to increase its market reach. ALU is well
positioned to benefit from the rise of smart connected devices and the emerging market for the
‘Internet-of-Things’. ALU will continue to drive top-line growth and expand operating margin, and is
confident of achieving its 2020 targets of US$200m revenue and an EBITDA margin of 35% or better.
Balance sheet is strong, with strong cash generation.
Lynas (LYC) is an integrated source of rare earths from mine to customer. The company’s resource
deposit in Mt Weld, Western Australia. Lynas rare earth minerals are mined and initially processed at
the Mt Weld Concentration Plant. The materials are then shipped to the Lynas Advanced Materials
Plant in Kuantan, Malaysia for refining/concentration in order to produce high quality rare earth oxides.
Lynas is the only rare earths producer to produce finished product outside China, which is a strategic
advantage in global supply chains seeking surety of supply outside China.
Ramsay Health Care (RHC) is is a global health care company offering a range of acute and primary
healthcare services from 480 facilities across 11 countries. RHC is a quality healthcare services
company with a solid and predictable outlook for earnings growth. Amongst some of its healthcare
peers, RHC offers a lower multiple with a PE of 22x, and ongoing earnings growth in the mid-single
digits. Growth continues to be generated through brownfields expansion in Australia and a growing
exposure to Europe and the United Kingdom.
Stockland (SGP) is a diversified property developer, owner and manager across retail industrial,
office, residential and retirement. Given the recent election result, APRA changes, lower interest rates
and a greater willingness for the banks to lend, it appears the residential market in Sydney and
Melbourne is seeing an inflection point and will begin to move higher. Given Stockland’s exposure
to the affordable housing market, they will be a major beneficiary from the turnaround in pre-sales,
which will be largely driven by First Home Buyers. Stockland are also working towards deleveraging
the balance sheet with the sell-down in retirement and capital partnering in the retail and residential
business.

unit prices
Ausbil Australian Geared Equity Fund

% %
3 months 8.67 2.55 6.12
6 months 21.18 10.80 10.38
FYTD 8.67 2.55 6.12
CYTD 50.18 22.90 27.28
1 year 14.84 12.57 2.27
3 years pa 22.03 11.85 10.17
5 years pa 15.14 9.55 5.60
7 years pa 20.15 10.89 9.26
10 years pa 10.17 8.05 2.12
Since inception pa 3.08 5.02 -1.93
Date: May 2007
* Returns are after fees and interest costs but before taxes.
Over the quarter, at a sector level, the Fund’s overweight positions in the Consumer Staples,
Financials and Health Care sectors contributed to relative performance. The underweight
positions in the Energy, Industrials, Information Technology and Utilities sectors also added
value. Conversely, the overweight positions in the Materials and Communication Services
sectors detracted from relative performance. The underweight positions in the Consumer
Discretionary and Real Estate sectors also detracted value.
At a stock level, the overweight positions in Lendlease, Independence Group, JB Hi-

Fi, Treasury Wine Estates, Santos, QBE Insurance, National Australia Bank and Aurizon
Holdings contributed to relative performance. The nil positions in Woodside Petroleum and
Amcor also added value. Conversely, the overweight positions in Iluka Resources, BHP, Rio
Tinto, Goodman Group, Brambles, Aristocrat Leisure and Telstra detracted from relative
performance. The nil positions in Wesfarmers, Coles and James Hardie also detracted
value.

30 September 2019 0.963068 0.000000

unit prices
Fund activity
Major Purchases and Sales
Purchases Sales
Altium Dexus Property Group
Lynas Downer EDI
Ramsay Health Care Link Administration
South32
The a2 Milk Company
Over the quarter, the Fund purchased holdings in Altium, Lynas, Ramsay Health Care and Stockland.
The positions held in Dexus Property Group, Downer EDI, Link Administration, ResMed Inc, South32
and The a2 Milk Company were sold during the period.
Altium (ALU) is an Australian multinational software corporation that focuses on electronic design
systems for printed circuit board (PCB) design and embedded system development. The pursuit of
PCB market dominance by 2025 is a strong focus for ALU in order to fulfil the vision of transforming
the collaboration within the electronics industry. The company is rolling out new products, pursuing
strategic partnerships and executing an M&A strategy to increase its market reach. ALU is well
positioned to benefit from the rise of smart connected devices and the emerging market for the
‘Internet-of-Things’. ALU will continue to drive top-line growth and expand operating margin, and is
confident of achieving its 2020 targets of US$200m revenue and an EBITDA margin of 35% or better.
Balance sheet is strong, with strong cash generation.
Lynas (LYC) is an integrated source of rare earths from mine to customer. The company’s resource
deposit in Mt Weld, Western Australia. Lynas rare earth minerals are mined and initially processed at
the Mt Weld Concentration Plant. The materials are then shipped to the Lynas Advanced Materials
Plant in Kuantan, Malaysia for refining/concentration in order to produce high quality rare earth oxides.
Lynas is the only rare earths producer to produce finished product outside China, which is a strategic
advantage in global supply chains seeking surety of supply outside China.
Ramsay Health Care (RHC) is is a global health care company offering a range of acute and primary
healthcare services from 480 facilities across 11 countries. RHC is a quality healthcare services
company with a solid and predictable outlook for earnings growth. Amongst some of its healthcare
peers, RHC offers a lower multiple with a PE of 22x, and ongoing earnings growth in the mid-single
digits. Growth continues to be generated through brownfields expansion in Australia and a growing
exposure to Europe and the United Kingdom.
office, residential and retirement. Given the recent election result, APRA changes, lower interest rates
and a greater willingness for the banks to lend, it appears the residential market in Sydney and
Melbourne is seeing an inflection point and will begin to move higher. Given Stockland’s exposure
to the affordable housing market, they will be a major beneficiary from the turnaround in pre-sales,
which will be largely driven by First Home Buyers. Stockland are also working towards deleveraging
the balance sheet with the sell-down in retirement and capital partnering in the retail and residential
business.

unit prices
Ausbil Australian Emerging Leaders Fund

% %
3 months 0.49 3.25 -2.76
6 months 3.62 8.00 -4.38
FYTD 0.49 3.25 -2.76
CYTD 17.92 19.52 -1.60
1 year -4.02 3.64 -7.66
3 years pa 6.17 10.12 -3.96
5 years pa 8.29 12.52 -4.23
7 years pa 11.20 12.04 -0.84
10 years pa 7.40 7.64 -0.24
15 years pa 8.97 7.96 1.01
Date: April 2002

** 70% S&P/ASX Midcap Accumulation Index and 30% S&P/ASX Small Ordinaries Accumulation Index.

30 September 2019 3.163495 0.000000
Fund performance for the quarter ending September 2019 was +0.49% (net of fees) versus the
benchmark return of +3.25%. The benchmark is represented by a composite, 70% of the S&P
/ASX MidCap 50 Accumulation Index and 30% of the S&P/ASX Small Ordinaries Accumulation
Index.
Over the quarter, at a sector level, the Fund’s overweight positions in the Information Technology
and Communication Services sectors contributed to relative performance. The underweight
positions in the Consumer Staples and Financials sectors also added value. Conversely, the
overweight positions in the Materials, Industrials, Health Care and Utilities sectors detracted
from relative performance. The underweight positions in the Energy and Consumer Discretionary
sectors also detracted value.
At a stock level, the overweight positions in JB Hi-Fi, Independence Group, Mesoblast, Afterpay
Touch, ResMed Inc, Fineos Corporation and Downer EDI contributed to relative performance.
The nil positions in Cimic Group, Orora and Whitehaven Coal also added value. Conversely,
the overweight positions in Cleanaway Waste Management, Clydesdale Bank, Appen, Webjet,
Iluka Resources, Sims Metal Management, Mineral Resources, Spark Infrastructure Group and
BlueScope Steel detracted from relative performance.

unit prices
Fund activity
Major purchases and sales
Purchases Sales
Challenger Atlas Arteria
Clydesdale Bank Boral
Emeco Holdings Charter Hall Group
Fineos Spark Infrastructure Group
Flight Centre Travel Group WiseTech Global
Healius
Magellan Financial Group
Seven West Media
Over the quarter, the Fund purchased holdings in Challenger, Flight Centre Travel Group, Sims Metal
Management, Emeco Holdings, Fineos, Healius, Magellan Financial Group, Seven West Media and
Clydesdale Bank. The positions held in Charter Hall Group, Atlas Arteria, Boral, Spark Infrastructure
and WiseTech Global were sold during the period.
Challenger (CGF) is diversified investment company secialising in annuities and funds management.
Thematically, CGF is in a sweet-spot. Effectively, the company is the monopoly provider of
retirement product in the form of annuities – the by-product of our ageing population thematic is
that more people are now retiring from the workforce and the pension phase is now switching from
accumulation to the retirement, or dis-accumulation, phase. Concurrently, the company has had to
downgrade margins as, in the current low-rate environment, the longer-term nature of the product
has proven to be increasingly less attractive. We sense that the interplay between retires and short-
term investment gains is now swinging back in favour of CGF and the pricing of their product. Add to
this the quota-share reinsurance tie-up with MS&D and there is a steady aspect to earnings growth
which, given where the stock is trading, presents real value.
Clydesdale Bank (CYB) is a diversified bank servicing the United Kingdom through the Clydesdale
and Yorkshire banks, and the digital banking and financial services platforms, B and Virgin Money.
CYB was owned by NAB from 1987 until 2016 when it was demerged and dual listed on both the
LSE and ASX. Ausbil has opportunistically initiated a small position in CYB at attractive valuation
levels, with a number of near-term catalysts that may potentially realise shareholder value, such as
the successful rebranding of the business as Virgin Money.
Emeco (EHL) is an equipment rental business that provides heavy earthmoving equipment solutions
to the resource industry throughout Australia. With mining companies taking a more conservative
approach to their balance sheets and the increase in mining production levels following the lows
of the cycle 4 years ago, Emeco is set to be a major beneficiary given the positive outlook for
resources. Following some weakness in the share price since the 1H19 result and the positive
earnings outlook makes Emeco an attractive addition to the portfolio.
Fineos Corporation (FCL) is a global vendor of core system software to the Life Accident & Health
Insurance industry. Fineos provides an end-to-end cloud enabled software solution to manage
claims. FCL listed on the ASX in August. Fineos is positioned to benefit from developments in the
insurance industry, and the burgeoning growth in the cloud software and services market. The
strong growth is driven by market share gain as the industry moves from legacy on premise systems
to the cloud, and an increase in product uptake. Margins should continue to improve given the
significantly higher incremental margin for cloud and SaaS product. The balance sheet is healthy
and the company continues to invest in research and development to drive future growth.
Flight Centre Travel Group (FLT) provides travel retailing, wholesaling and corporate travel
management services as well as tour operations. Leisure travel demand has been relatively weak
due to weak consumer spending and that has an impact on commissions and overrides. We
are starting to see some improvement or stabilisation in airfares which is encouraging. Given the
leverage in the business from a high fixed costs base, upgrades to earnings are significant even from
a small move in volume. The corporate division is doing better with FLT continuing to win market
share in the SME market. Corporate is likely to be the key growth driver for FLT going forward. FLT is
also undergoing a cost out initiative which will help to reduce the pressure on earnings from a weak
top-line. The balance sheet is strong and FLT’s valuation remains attractive.

unit prices
Healius (HLS) is one of Australia’s largest providers of pathology, medical and general
practitioner services, and diagnostic imaging. The Health Care sector is well positioned to
benefit from low interest rates and provides steady, longer term earnings streams that the
market is increasingly valuing. Ausbil has established a position on the back of an improving
earnings outlook and the potential for corporate activity.
Magellan Financial Group (MFG) is an investment manager that, like competitor Platinum
Asset Management, has built a global investment platform for investors that is benefitting from
strong growth in offshore investing. This is has been supported by global market returns,
and a rapidly expanding superannuation asset pool that has exceeded the capacity available
in the Australian sharemarket, and created significant demand for global assets. Magellan
offers strong earnings and cashflow with a high margin conversion to net earnings based FUM
growth, and a relatively low cost base as with asset management businesses. Magellan have
embarked on the next stage of their development–they are expanding their distribution into the
self-directed segment and are unveiling new funds (high conviction, low carbon, and a product
for retirees) over the next few months. Combine this with a raise for another LIT (“costless” to
retail investors/shareholders) and the stock-price is likely to maintain its upward impetus over
the next 24 months.
Seven West Media (SWM) is a multi-platform media company that engages in broadcasting
television, magazine, newspaper publishing and digital media. The stock has been under
significant pressure partly due to a weak advertising market and partly due to previous
management losing focus on the business. The recent management change is positive. We
should see a strategy to improve TV earnings through cost cutting and refocus on content and
asset sales to improve the balance sheet, and acquisitions to improve the business model.
Leverage in the business is significant given the high fixed cost base. The stock is relatively
cheap due to the weak ad market, share losses and high debt levels, however the outlook from
here is more favourable.

unit prices
Ausbil MicroCap Fund

% Performance
%
3 months 5.03 13.69 -8.66
6 months 12.05 20.59 -8.54
FYTD 5.03 13.69 -8.66
CYTD 29.79 35.43 -5.63
1 year 11.44 13.24 -1.80
3 years pa 11.25 6.15 5.10
5 years pa 17.58 9.17 8.41
7 years pa 20.86 3.30 17.57
Date: February 2010

** The S&P/ Emerging Companies Accumulation Index.

30 September 2019 3.535083 0.000000
The Fund produced a respectable return of +5.03% (net of fees) in the September quarter taking
the CYTD return to 29.8%. Despite this, the Fund was unable to keep pace with the extraordinary
+13.7% rise in the benchmark. While disappointing, it is worth noting that the broader market
posted more modest returns across the market cap spectrum, ranging from 1.0% for the S&P/
ASX 20 Accumulation Index to 3.1% for the S&P/ASX Small Ordinaries Accumulation Index.
Benchmark positions in Ramelius, Avita Medical, Paradigm Pharmaceuticals and Electro Optic
Systems together accounted for over 4.2% of the underperformance. The top ten performing
stocks in the index delivered an average absolute return of +85%. The ten largest index positions
delivered an average absolute return of 31.8%. Many of these names failed to meet our core
investment criteria in one way or another, either due to poor liquidity, unprofitable operations,
governance issues or valuation concerns.
Among the largest positive contributors to performance for the quarter were Baby Bunting,
EML Payments and Polynovo. Negative contributors included Rural Funds Group, Silver Lake
Resource and Nearmap.
Baby Bunting (BBN) rose +66.7% for the quarter (+19.1% in September), continuing its strong
performance following an outstanding result – capturing market share, delivering strong same
store sales growth (+8.7%), expanding gross margins and providing a strong outlook. Following
a period of intense competition, management have begun to capitalise on a well-articulated
strategy. Prior to the result, market expectations were low with the stock trading on around
16x PE for FY20 with +30% EPS growth. The result beat on both FY19 and FY20 consensus,
resulting in positive earnings revisions. Baby Bunting is a category killer in the baby goods
retailing segment and offers defensive growth characteristics with further potential upside from
a revised store network plan currently under review and continued execution on its strategy.
EML Payments (EML) returned +44.9% in the quarter (+11.4% in September) after an
impressive FY19 result that exceeded both consensus estimates and company guidance. The
result was strong across the board with all divisions delivering solid growth. Notable areas of
strength that captured investors’ attention included the momentum building in the US gaming
segment, very strong growth in virtual account numbers and solid performance in the high
yielding gift and incentive cards segment. With healthy momentum across the business, and a
large opportunity set ahead of it, the outlook for EML remains promising.

unit prices
Polynovo (PNV) rallied in the September quarter rising +39.0% (+5.4% in September) on the
back of strong business momentum as detailed to the market during the August reporting season,
positive discussions with the US FDA with respect to PNV’s full thickness burns pivotal trial and also
partly supported by its recent inclusion within the S&P/ASX 200 index. Polynovo’s (PNV) primary
product is a biodegradable temporising matrix (BTM) developed for use as an implantable dressing
on complex open wounds and major burns. The BTM provides a form of non-organic scaffold that
supports the regeneration of the dermis prior to skin grafting. As the dermis regenerates it replaces
the biodegrading BTM. Compared to competing products based on organic materials, PNV’s BTM
results in much lower rates of infection and a more durable and aesthetic skin reconstruction. PNV
is actively exploring opportunities to commercialise its Novosorb technology in the large markets
for hernia repair and breast reconstruction. Revenue growth is accelerating and the company is
expected to deliver positive operating earnings in FY20.
Rural Funds Group (RFF) fell -25.1% for the quarter (-19.9% in September) despite a solid earnings
result with guidance reiterated for growth in both its distribution and adjusted funds from operations
(AFFO). Unfortunately the solid earnings result was completely overshadowed by the release of a
document early in the August by an obscure investment group based in the US suggesting, on the
basis of their research, that RFF was a “fraud” and its equity “ultimately worthless”. The authors of
the report had short-sold RFF stock and stood to benefit from instigating panic and heavy selling
in the shares. On the day the report was released, RFF shares fell more than 40%. The report itself
was very poorly researched and of low quality. Most of the major assertions could be easily dispelled
with a casual inspection of RFF’s accounts. RFF’s response to the document was ultimately effective
and included an independent review of each major assertion in the report against RFF’s accounts
conducted by global top four accounting firm, EY. By the end of August, the panic had subsided
and the shares recovered to post a more modest loss of 6.9%. In September, RFF was subject
to another attack on the company by a research group based in Hong Kong with claims that RFF
was running a “Ponzi scheme”. We reviewed the major assertions made by this group in detail and
concluded that none of them had merit, most demonstrated a very poor understanding of RFF’s
operations and some highlighted a basic misunderstanding of accounting principles. Neither group
have sought to verify their assertions with the company and are essentially self-serving.
Silver Lake Resources (SLR) fell -25.5% in the September quarter (-12.2% in September) after
almost doubling in price between early May and the end of July. The strong surge in the US$ gold
price was the primary catalyst for the surge in the share price, however it is hard to rationalise a
return of more than 100% in the shares with a c15% rally in the gold price over the same period.
SLR’s quarterly report released on the last day of July was largely benign however it did reveal cost
creep, lower full year gold production than the company had guided and a slightly disappointing
outlook. With the strong run in the share price and the valuation looking stretched, any indications
of weakness in the result and outlook was always going to be received poorly.
Nearmap (NEA) fell -31.8% in the quarter (-5.5% in September) after reaching an all-time high of
$4.23 in late June, representing a 300% return over the preceding 12 months. After such a strong
performance, and with the valuation showing signs of stress, we had anticipated selling pressure
and had been lightening the position accordingly. The company provided earnings guidance in early
July to help temper some of the more bullish expectations amongst the sell-side analyst community
which took some steam out of the surging share price. This was followed up in August with a
results release that was solid but slightly underwhelming. Combined with an accounting policy
change that resulted in a significant increase in amortisation expenses (albeit with no cash impact),
commentary on the analyst call indicated that the company was seeing increased competition in
the domestic market and outlook guidance that included material reinvestment in the business
(negatively impacting short term operating metrics), the shares beat a sharp retreat as investors
struggled to marry up the company’s high trading multiples with a softer short-term growth outlook.
We think NEA still offers investors years of strong growth as it penetrates a large global market that
is fragmented and still in its early stages of development and we remain positively disposed to the
name.

unit prices
Significant Fund Activity

Purchases Sales
Cedar Woods Properties Imdex
Fineos Corp Holdings Kidman Resources
Infomedia OceanaGold
Kogan Pacific Energy
Mount Gibson Silver Lake Resources
Opticomm Vista Group
Pointsbet Zip Co
Ramelius Resources
Superloop
Uniti Wireless
During the September quarter, the Fund initiated positions in Cedar Woods Properties, Fineos Corp
Holdings, Infomedia, Kogan, Mount Gibson, Opticomm, Pointsbet, Ramelius Resources, Superloop
and Uniti Wireless. The positions held in Imdex, Kidman Resources, OceanaGold, Pacific Energy,
Silver Lake Resources, Vista Group and Zip Co were exited.
Cedar Woods Properties (CWP) is a developer, constructor and manager of Australian residential
and commercial properties. CWP has demonstrated operational resilience through the cycle with
consistent NPAT and dividends since 2011. Since the 2019 Federal Election, property prices have
shown early signs of improvement. CWP is well placed to capture the effects of improving operating
conditions which we believe will lead to positive earnings revisions. CWP’s current gearing is at the
lower end of the company’s stated target range, which provides additional flexibility to take advantage
of opportunities and accelerate future growth.
Fineos Corporation (FCL) is a global vendor of core system software to the Life Accident & Health
Insurance industry. Fineos provides an end-to-end cloud enabled software solution to manage
insurance claims. FCL listed on the ASX in August. Fineos is positioned to benefit from developments
in the insurance industry and the industry’s adoption of cloud software solutions. Strong anticipated
growth is driven by market share gains as the industry moves from legacy on premise systems to
the cloud, and increased consumption from existing customers. Margins should continue to improve
given the inherent scalability of SaaS business models. The balance sheet is healthy and the company
continues to invest in research and development to expand and improve the product suite and drive
future growth.
Infomedia (IFM) is a leading software as a service (SaaS) provider to the automotive aftermarket
focusing on parts and servicing with over 150,000 users in more than 186 countries worldwide. The
largest division, Microcat, provides Original Equipment Manufacturer (OEM) dealers an Electronic
Parts Catalogue (EPC), as well as Collision Parts Orders, Independent Repairers, Wholesale Parts
CRM and a Mobile Chat app. The Super Service division is growing strongly, in excess of 25%
organic revenue growth through service quoting, vehicle health check and online service booking
amongst other offerings. The acquisition of Nidasu in November 2018 compliments IFM’s existing
core business by enhancing its data and insights capability.
Kogan (KGN) is a multi-product, pure online retailer. Kogan is well known for its Kogan branded
exclusive products (primarily in-demand electronics), third-party brands, its Marketplace capability
(akin to Amazon’s marketplace), as well as Kogan branded mobile telephony, internet, health, and
Insurance offerings. Kogan is well known for its price leadership and serves over 1.6 million active
customers. This customer base provides a large source of potential subscribers for Kogan’s multitude
of products with the benefit of very low customer acquisition costs. With continued strong growth
in legacy offerings and the opportunity to monetise a large, loyal and growing customer base with a
multitude of high margin branded subscription services the outlook looks positive for Kogan.

unit prices
Mount Gibson (MGX) is an Australian explorer and producer of high quality iron ore. MGX
operates the high grade Koolan Island mine in the Kimberley region within Western Australia
which boasts approximately 21 million tonnes of hematite ore reserves with a grade averaging
65.5% iron. Mining production was recently resumed in April 2019 following the reconstruction
of the seawall and mine restoration. Given a favourable outlook for Iron Ore, the Fund has re-
established a position in MGX having earlier exited at materially higher prices.
Opticomm (OPC) designs, builds, operates and maintains fibre based wholesale
telecommunications networks to predominately residential but also commercial premises.
OPC listed on the ASX in August, returning +54% on the day of the IPO. As a wholesale
access provider, Opticomm provides Retail Service Providers (RSPs) wholesale access to its
predominantly fibre-based telecommunications infrastructure to provide its customers with
telecommunication services such as internet and voice. OPC currently has over 60,000 active
premises out of a total 106,000 installed services. As customers continue to connect to RSP
services, they will move from installed to active premises. In addition, OPC has a strong pipeline
of over 100,000 lots contracted but not under construction providing a healthy outlook for future
growth.
PointsBet (PBH) is a licensed provider of online sports betting services in Australia and the US.
PointsBet established itself in the relatively sophisticated Australian online sports betting market
with consumer offerings in the fixed odds, spread-betting and horse racing categories. The
company owns the core software IP behind each of its products which enhances its ability to
respond quickly to changes in consumer trends and competitor behaviour. Whilst the Australian
operations have provided a proving ground for the company’s technology and go-to-market
strategies, the bigger prize has always been the vast online sports betting market in the US.
Until recently, online sports betting in the US was illegal at the Federal level, but is now being
progressively opened up on a state-by-state basis following the successful challenge to the
PASPA Act. Each state in the US now has jurisdiction over the decision to legalise (or not) online
sports betting. States such as New Jersey, Pennsylvania, Delaware and West Virginia have
moved quickly to legalize sports betting and as more states progressively legislate in favour of
it, PointsBet is well placed to play a leading role as an early mover.
Ramelius Resources (RMS) is predominantly a gold explorer and producer within Western
Australia. Ongoing explorations are currently located in Western Australian and Nevada (USA).
Operations are based in Mt Magnet, Edna May and the Vivien mine near Leinster. The current
mine plan calls for production in excess of 200,000 ounces per annum over 5 years at a margin
approaching A$1,000/oz at current A$ spot rates. Reserve life is relatively short at 3.5 years,
however the resource base offers almost 30 years of production at current rates assuming it can
all be converted to reserves.
Superloop (SLC) is a specialist telecommunications company with strategically positioned fibre

network assets across the Asia pacific in Australia, Singapore and Hong Kong. The assets are
positioned in areas subject to strong growth in IP traffic as demand for data intensive applications
such as cloud computing, video and mobile continue to grow exponentially. SLC’s under-utilised
but well placed assets offer a high degree of operating leverage which should underpin strong
earnings growth for a number of years. With the balance sheet restored to strength following a
recent capital raise we see the path clear for SLC to focus on leveraging its core fixed assets to
deliver earnings and cash flow growth.
Uniti Wireless (UWL) is a fast growing full service telecommunications company focused on
the ownership, operation and provision of wireless networks, fibre networks and specialist
telecommunications products throughout Australia. UWL recently completed the acquisition of
LBN Co which has 418 estates / buildings contracted nationwide with a strong pipeline of lots
under construction. UWL has significant organic and acquisitive growth opportunities backed
by former M2 Telecommunications and TPG Telecom executives.

unit prices
Candriam Sustainable Global Equity Fund

% %
3 months 4.92 4.60 0.32
6 months 9.30 10.12 -0.82
FYTD 4.92 4.60 0.32
CYTD 21.49 22.76 -1.26
1 year 8.92 9.24 -0.32
3 years pa 12.34 14.94 -2.60
5 years pa 10.77 12.91 -2.14
7 years pa 15.52 16.67 -1.15
10 years pa 10.93 11.98 -1.05
15 years pa 6.49 7.65 -1.16
Since inception 5.85 6.82 -0.97
Date: December 2002

** MSCI World Index (unhedged in AUD).

30 September 2019 0.904573 0.000000
Market Review
Subsequent to a difficult summer for risk assets, investors returned from their holidays in a bullish
mood and drove US equities higher in September, leaving global equities broadly flat for the
quarter. The quarter was marked by a continued slowdown in the global economic data, offset
by further monetary easing from the US and Europe.
In the US, the Federal Reserve cut interest rates in July and September in an attempt to prolong
economic expansion in the face of a slowdown in the pace of growth and hiring. While the
economy continued to add jobs, the pace in growth of aggregate hours worked in the economy
has slowed meaningfully. Consumer confidence also declined from elevated levels.
In Europe, the ECB responded to the weaker economic outlook by cutting interest rates further
into negative territory, restarting quantitative easing and committing to continue with asset
purchases until it achieves its inflation target. The ECB’s policy easing came against a backdrop
of weakening growth, particularly in the manufacturing sector.
In the UK, the Brexit saga dragged on, with parliament passing legislation that will force the
government to ask for an extension if it cannot agree to a deal with the EU. This sent sterling
higher, before the prime minister suspended parliament, only for the suspension to be ruled
unlawful. A highly unpredictable election remains the most likely outcome if a deal cannot be
reached in the coming weeks. The Bank of England remained on hold as Brexit uncertainty
continued to cloud the outlook for the UK economy.
In Japan, the consumption tax hike has just come into place, posing a risk to an economy that is
already feeling the effects of the global slowdown in manufacturing. The Bank of Japan resisted
the temptation to join in the easing game, but said it would review the outlook at its next meeting,
perhaps hinting at further easing to come.
The trade war also continued to play a prominent role in financial headlines. Further tariffs are
due to come into place by the end of the year unless renewed talks between the US and China
make sufficient progress.
China’s economy continued to slow. However, with growth still comfortably above that in the US,
and given that the US economy is also slowing as a result of the trade dispute, together with a
US election next year, it’s far from clear that China will concede to US demands on trade.

unit prices
Key Stock Contributors and Detractors

The top three contributors in Q3 were Sherwin-Williams, Procter & Gamble and OMV AG:
Sherwin-Williams Company is an overweight position in Materials, thanks to its good scores
on Capital Spending Discipline, Growth Potential and Profitability. The Sherwin-Williams Company
manufactures, distributes, and sells paints, coatings, and related products. Stocks climbed (+18%)
in relative terms over the quarter. This was mainly driven by the announcement of the Group’s Q2
results which were well above analyst expectations. Candriam’s ESG rating is ‘Advanced’.
Procter & Gamble is an overweight position in Consumer Staples due to its good scores on
Earnings Reliability, Profitability and Solvency. Procter & Gamble manufactures and markets
consumer products in countries throughout the world. Shares rose over (+11%) in relative terms
across the 3rd quarte, following the company’s announcement of its best quarter of organic sales
in more than a decade. Shares finished the quarter at a year to date high. Candriam’s ESG rating
is ‘Leading’.
OMV AG is an overweight position in Energy, thanks to its good score on Valuation. OMV AG
explores and refines crude oil and natural gas. OMV shares climbed over (+6%) in relative terms
in the 3rd quarter. This was driven by the release of robust Q2 results, most notably the sharp rise
in oil prices following the Saudi oil attacks which injected a short-term risk premium into crude oil
and oil equities. Candriam’s ESG rating is Advanced.
Three stocks that detracted from relative performance in Q3 were Apple Inc, Amazon.com and
BHP Group.
Apple Inc is an underweight position in Information Technology as it is not ESG eligible. Apple
designs, manufactures, and markets personal computers and mobile communication devices,
along with a variety of related software and services. Over the third quarter, the share price
increased by (+6.5%) in relative terms due to the announcement of good Q3 revenue figures, the
launch of new phones, and the delay of new tariffs on some items. Candriam’s ESG rating is ‘Not
Eligible’.
Amazon.com is an overweight position in the Consumer Discretionary sector, scoring well on

Profitability. Amazon is an online retailer that offers a wide range of products. Despite strong
results with accelerating revenues, the share price decreased by (-14%) in relative terms. Investors
showed concerned regarding the surge in costs linked to the Prime 1-day shipping services,
which was the key driver of top-line acceleration. Candriam’s ESG rating is ‘In Line’.
BHP Group is an overweight position in Materials. BHP scored well on Profitability and Solvency.
BHP operates as a resource mining company. The share price declined by (-19%) in relative terms
over the quarter. BHP’s Q4 FY19 production release was solid, with output beating estimates
across all assets except Copper. However, FY19 coal output fell short, FY20 guidance looks soft
for a certain metals, and the Iron Ore price in the quarter was below the average benchmark price.
Candriam’s ESG rating is ‘Runner Up’.

unit prices
Ausbil 130/30 Focus Fund

% %
3 months 1.72 2.37 -0.65
6 months 9.62 10.53 -0.91
FYTD 1.72 2.37 -0.65
CYTD 20.59 22.56 -1.97
1 year 10.64 12.47 -1.83
3 years pa 11.97 11.88 0.10
5 years pa 10.40 9.50 0.90
7 years pa 12.72 10.97 1.75
Date: July 2010
* Returns are after fees but before taxes for the class.
** S&P/ASX 200 Accumulation Index,

30 September 2019 1.711307 0.000000
benchmark return of +2.37%, as measured by the S&P/ASX 200 Accumulation Index.
Over the quarter, at a sector level, the Fund benefited from underweight positions in the Energy,
Materials, Industrials, Financials, Information Technology and Communication Services Sectors.
Conversely, the overweight positions in the Health Care, Utilities and Real Estate sectors
detracted from relative performance. The underweight positions in the Consumer Discretionary
and Consumer Staples sectors detracted value.
The Fund’s largest short positions were in selected stocks within the Consumer Staples, Materials
and Industrials sectors.
At a stock level, the Fund benefited from overweight positions in Treasury Wine Estates, The
a2 Milk Company, Charter Hall Group, Santos, Aurizon Holdings and National Australia Bank.
The underweight positions in Cimic Group, Brambles and Ramsay Health Care as well as the nil
holding in South32 also added value. Conversely, the overweight positions in Goodman Group,
Northern Star Resources, Dexus Property Group, BHP, Synlait Milk, Seven Group and Medibank
detracted from relative performance. The underweight positions in Wesfarmers, Coles and
Afterpay Touch also detracted value.

unit prices
Fund activity
Over the quarter, the Fund purchased holdings in Cleanaway Waste Management, Computershare,
Healius, Northern Star Resources, Origin Energy, OZ Minerals, Ramsay Health Care and Wesfarmers.
The following holdings were sold during the period, Afterpay Touch, Austal, BlueScope Steel, Iluka
Resources, Magellan Financial Group, Sydney Airport, The a2 Milk Company and WorleyParsons.
Cleanaway Waste Management (CWY) is a leading Australian waste management company,

incorporating the recently acquired TOX, now offers total waste solutions from general waste,
recycling and industrial services to liquid and hazardous waste, used oil and oily water, and
construction and demolition waste. The Australian waste market is arguably still in the emerging
phase versus mature phase (compared to global peers), and CWY is strategically well positioned
to capitalise on that structural market transformation. We estimate CWY has the capacity to
deliver growing free cash flow which should support positive earnings revisions and, potentially, an
increase in the dividend payout ratio. The investment case for CWY is compelling in both absolute
and relative terms.
Healius (HLS) is one of Australia’s largest providers of pathology, medical and general practitioner
services, and diagnostic imaging. The Health Care sector is well positioned to benefit from low
interest rates and provides steady, longer term earnings streams that the market is increasingly
valuing. Ausbil has established a position on the back of an improving earnings outlook and the
potential for corporate activity.
Northern Star Resources (NST) is a global gold miner with operations in Australia and the
United States. The company has a diverse production base, with gold production from three tier-
1 world-class mining operations. NST are Australia’s second largest gold producer with Group
FY20 production guidance of 800,000-900,000oz. The company are a best-in-class underground
miner, with low cost operations. Group FY20 AISC guidance is for A$1,200-1,300/oz. The existing
resource potential, combined with cost efficiency and a strong outlook for gold is expected to
support strong earnings growth.
Origin Energy (ORG) is an integrated energy company, with two core businesses: Energy Markets
and Integrated Gas. The Energy Markets segment includes Australian energy retail operations,
including energy related products and services, power generation activities and LPG operations.
The company also has renewable energy investments, including wind, geothermal, solar and
hydro. The Liquefied Natural Gas (LNG) segment covers the company’s investment in the Australia
Pacific LNG project in Gladstone.
Ramsay Health Care (RHC) is is a global health care company offering a range of acute and
primary healthcare services from 480 facilities across 11 countries. RHC is a quality healthcare
services company with a solid and predictable outlook for earnings growth. Amongst some of its
healthcare peers, RHC offers a lower multiple with a PE of 22x, and ongoing earnings growth in
the mid-single digits. Growth continues to be generated through brownfields expansion in Australia
and a growing exposure to Europe and the United Kingdom.
Wesfarmers (WES) is one of Australia’s largest companies, employing over 490,000 staff,
with diverse business operations in home improvement and outdoor living, apparel and general
merchandise, office supplies and in chemicals, energy, fertilisers, and industrial and safety products.
Following the demerger of Coles, over half of Group EBIT is now generated by Bunnings. Bunnings
is leveraged to the Australian housing market and given Ausbil’s view that the housing market has
stabilised and set for moderate growth, WES and Bunnings specifically will benefit. The earnings
strength from Bunnings should counter any weakness in the other parts of the Group particularly
the Group’s discount department stores businesses.

unit prices
Ausbil Active Dividend Income Fund

% %
3 months 2.64 2.37 0.27
6 months 10.35 10.53 -0.17
FYTD 2.64 2.37 0.27
CYTD 25.07 22.56 2.51
1 year 14.16 12.47 1.69
Date: July 2017

31 July 2019 1.037503 0.458599
31 August 2019 1.021137 0.459000
30 September 2019 1.033794 0.459000
At a sector level, the Fund benefited from overweight positions in the Industrials, Health
Care and Financials sectors. The underweight position in the Communication Services
sector also added value. Conversely, the overweight positions in the Energy, Utilities and
Real Estate sectors detracted value. The underweight positions in the Materials, Consumer
Discretionary, Consumer Staples and Information Technology sectors also detracted value.
At a stock level, the overweight positions in JB Hi-Fi, Aurizon Holdings, Genworth Mortgage
Insurance Australia, Lendlease, Charter Hall Long Wale REIT, Charter Hall Group and ResMed
Inc contributed to relative performance. The underweight positions in Brambles, Telstra and
Transurban also added value. Conversely, the overweight positions in Rural Funds Group, Rio
Tinto, Woodside Petroleum and Commonwealth Bank detracted from relative performance.
The underweight positions in Wesfarmers and Woolworths, and the nil holdings in James
Hardie, Afterpay Touch and Newcrest Mining also detracted value.

unit prices
Fund activity
Purchases Sales
ASX Amcor
Bendigo and Adelaide Bank Dexus Property Group
Brambles DuluxGroup
Coles Group Genworth Mortgage Insurance Australia
Evolution Mining Metcash
Insurance Australia Group ResMed
Investec Australia Property Fund Stockland
Medibank Telstra
Origin Energy Transurban Group
Qantas Woodside Petroleum
Ramsay Health Care
Regis Resources
Spark New Zealand
Tabcorp Holdings
Wesfarmers
Woolworths
Over the quarter, the Fund purchased holdings in ASX, Bendigo and Adelaide Bank, Brambles, Coles
Group, Evolution Mining, Insurance Australia Group, Investec Australia Property Fund, Medibank,
Origin Energy, Qantas, Ramsay Health Care, Regis Resources, Spark New Zealand, Tabcorp Holdings,
Wesfarmers and Woolworths. The positions held in Amcor, Dexus Property Group, DuluxGroup,
Genworth Mortgage Insurance Australia, Metcash, ResMed, Stockland, Telstra, Transurban Group
and Woodside Petroleum were sold over the period.
Brambles (BXB) is one of the world’s most sustainable logistics and supply-chain companies,
offering reusable pallets, crates and containers. BXB is in a transitionary period as it navigates near-
term headwinds which are, for the most part, cyclical as opposed to structural. Strategies are in
place to cushion the impact on bottom line profitability, however our analysis suggests that operating
leverage is unlikely to eventuate until at least the 2020 financial year. The sale of the IFCO business
was above expectations and proceeds will be applied to an on-market buyback. In conjunction with
the emerging opportunities and on-market buyback, we believe this will continue to support the
current multiple.
Coles Group (COL) is one of Australia’s largest supermarket and retail groups. Coles Group also
owns flybys, Coles Express, Coles Financial Services, Spirit Hotels and a range of liquor retailers
including Liquorland, First Choice and Vintage Cellars. The FY19 result was messy but not as bad
as feared, without the earnings disappointment or incremental capex spend the market feared and
included a special div. Recently disclosed a 1 billion dollar cost out program, with the proceeds to
mainly be re-invested to fight cost inflation, potential upside if the 1 b is not needed in entirety. The
food business lacks a clear position in the market, and industry feedback indicates the team is not
as proficient nor as experienced as its main competitor. Industry feedback is indicating the potential
for COL to post the first negative lfl for the first quarter in 47 quarters. Starting to see inflation come
through in long life which will benefit the industry. ADIF invested post result to harvest the dividend
yield.
Evolution Mining (EVN) is an Australian focused gold mining company. The company benefits
from a diverse group of longer-life assets, operating five 100%-owned gold mines located in NSW,
Queensland and Western Australia, plus an economic interest in the Ernest Henry Copper-Gold mine.
Following several transformative acquisitions, EVN is the third largest gold producer on the ASX.
FY20 Gold output guidance is for 725,000-775,000 oz at AISC of A$890-940/oz. The largest asset,
the acquired Cowal mine in NSW, is a high-quality, low-cost, long-life asset with further resource
potential that can deliver 250,000+ oz per annum at sub-A$1,000/oz over the medium-term.

unit prices
Medibank (MPL) is an integrated healthcare company providing private health insurance and health
solutions to 3.7 million Australians, accounting for a share of around 26% of the health insurance
market. In 2018, MPL posted an operating profit of $535.6 million, improving on the 2017 profit of
497.5 million, with level claims expenses being the stand-out components of the result; expense
management was strong and productivity benefits were extracted from streamlining and digitisation
initiatives. While 2018 was a challenging year for insurers, 2019 has seen strengthening in premium
income. MPL is the choice listed operator in this space with a highly competent and respected
management team, and a strong and improving earnings outlook.
Origin Energy (ORG) is an integrated energy company, with two core businesses: Energy Markets and
Integrated Gas. The Energy Markets segment includes Australian energy retail operations, including
energy related products and services, power generation activities and LPG operations. The company
also has renewable energy investments, including wind, geothermal, solar and hydro. The Liquefied
Natural Gas (LNG) segment covers the company’s investment in the Australia Pacific LNG project in
Gladstone.
Wesfarmers (WES) is one of Australia’s largest companies, employing over 490,000 staff, with diverse
business operations in home improvement and outdoor living, apparel and general merchandise,
office supplies and in chemicals, energy, fertilisers, and industrial and safety products. Following the
demerger of Coles, over half of Group EBIT is now generated by Bunnings. Bunnings is leveraged to
the Australian housing market and given Ausbil’s view that the housing market has stabilised and set
for moderate growth, WES and Bunnings specifically will benefit. The earnings strength from Bunnings
should counter any weakness in the other parts of the Group particularly the Group’s discount
department stores businesses.
Woolworths (WOW) is one of Australia’s leading supermarkets, with good returns and a strong
balance sheet. The demerger of Endeavour simplifies the business and creates capital management
potential. The new online strategy has the potential to create structural differences between it and COL
and may become a long term advantage. Starting to see inflation come through in long life which will
benefit the industry. Strong sales momentum across the Group in FY19 that improved in the second
half of FY19 and has carried into FY20, +7.5% LFL in Australian Food to date in 1Q20. This will likely
be followed up by a strong quarter 1Q due to a soft comp. and a strong 2Q off the back of Discovery
Garden and a weather affected comp. This strong growth will enable WOW to better get a handle for
the cost imposts coming in FY20 (new EBA).

unit prices
Ausbil Australian Concentrated Equity Fund

% %
3 months 5.61 2.55 3.06
6 months 12.70 10.80 1.89
FYTD 5.61 2.55 3.06
CYTD 27.08 22.90 4.18
1 year 10.88 12.57 -1.69
Date: December 2017


30 September 2019 1.174143 0.000000
Over the quarter, at a sector level, the Fund benefited from overweight positions in the
Communication Services, Financials and Health Care sectors. The underweight positions
in the Energy, Industrials, Materials and Utilities sectors also added value. Conversely, the
overweight position in the Real Estate sector detracted value. The underweight positions
in the Consumer Discretionary, Consumer Staples and Information Technology sectors
detracted from relative performance.
At a stock level, the overweight positions in Lendlease, Independence Group, JB Hi-Fi,

Treasury Wine Estates, Santos, Afterpay Touch, QBE Insurance, Aurizon Holdings and
National Australia Bank contributed to relative performance. The nil holding in Woodside
Petroleum also added value. Conversely, the overweight positions in Goodman Group, BHP,
Rio Tinto, Telstra, Aristocrat Leisure and Seven Group detracted from relative performance.
The nil holdings in Wesfarmers, James Hardie, Coles Group, Newcrest Mining and Seven
Group also detracted value.

unit prices
Fund activity
Purchases Sales
Altium ResMed Inc
Lynas Seven Group
Ramsay Health Care
Stockland
Over the quarter, the Portfolio purchased holdings in Altium, Lynas, Ramsay Health Care and
Stockland. The positions held in ResMed Inc and Seven Group were sold during the period.
Altium (ALU) is an Australian multinational software corporation that focuses on electronic

design systems for printed circuit board (PCB) design and embedded system development.
The pursuit of PCB market dominance by 2025 is a strong focus for ALU in order to fulfil the
vision of transforming the collaboration within the electronics industry. The company is rolling
out new products, pursuing strategic partnerships and executing an M&A strategy to increase
its market reach. ALU is well positioned to benefit from the rise of smart connected devices and
the emerging market for the ‘Internet-of-Things’. ALU will continue to drive top-line growth and
expand operating margin, and is confident of achieving its 2020 targets of US$200m revenue
and an EBITDA margin of 35% or better. Balance sheet is strong, with strong cash generation.
Lynas (LYC) is an integrated source of rare earths from mine to customer. The company’s
resource deposit in Mt Weld, Western Australia. Lynas rare earth minerals are mined and initially
processed at the Mt Weld Concentration Plant. The materials are then shipped to the Lynas
Advanced Materials Plant in Kuantan, Malaysia for refining/concentration in order to produce
high quality rare earth oxides. Lynas is the only rare earths producer to produce finished product
outside China, which is a strategic advantage in global supply chains seeking surety of supply
outside China.
Ramsay Health Care (RHC) is a global health care company offering a range of acute and
services company with a solid and predictable outlook for earnings growth. Amongst some of
its healthcare peers, RHC offers a lower multiple with a PE of 22x, and ongoing earnings growth
in the mid-single digits. Growth continues to be generated through brownfields expansion in
Australia and a growing exposure to Europe and the United Kingdom.
office, residential and retirement. Given the recent election result, APRA changes, lower interest
rates and a greater willingness for the banks to lend, it appears the residential market in Sydney
and Melbourne is seeing an inflection point and will begin to move higher. Given Stockland’s
exposure to the affordable housing market, they will be a major beneficiary from the turnaround
in pre-sales, which will be largely driven by First Home Buyers. Stockland are also working
towards deleveraging the balance sheet with the sell-down in retirement and capital partnering
in the retail and residential business.

unit prices
Ausbil Active Sustainable Equity Fund

% %
3 months 3.72 2.37 1.35
6 months 9.72 10.53 -0.81
FYTD 3.72 2.37 1.35
CYTD 25.41 22.56 2.85
1 year 9.66 12.47 -2.81
Since inception pa 10.57 11.38 -0.81
Date: Feb 2018

30 September 2019 1.137706 0.000000
benchmark return of +2.37%, as measured by the S&P/ASX 200 Accumulation Index.
Over the quarter, at a sector level, the Fund’s overweight positions in the Communication
Services, Financials, Health Care and Information Technology sectors contributed to relative
performance. The underweight positions in the Energy, Industrials, Materials and Utilities sectors
also added value. Conversely, the overweight position in the Real Estate sector detracted from
relative performance. The underweight positions in the Consumer Discretionary and Consumer
Staples sectors also detracted value.
At a stock level, the overweight positions in Lendlease Group, Independence Group, JB Hi-
Fi, Santos, QBE Insurance, CSL and Macquarie Group added to relative performance. The nil
positions in Woodside Petroleum, Resmed Inc and South32 also added value. Conversely, the
overweight positions in Appen, Cleanaway Waste Management, BHP Group, Godman Group
and Rio Tinto detracted from relative performance. The nil positions in Woolworths, Wesfarmers,
James Hardie Industries, Treasury Wine Estates and Coles Group also detracted value.

unit prices
Fund activity
Purchases Sales
Lynas Dexus Property Group
Ramsay Health Care OZ Minerals
The a2 Milk Company
Over the quarter, the Fund purchased holdings in Lynas, Ramsay Health Care and Stockland.
The positions held in Dexus Property Group, OZ Minerals, Resmed Inc and The a2 Milk
Company were sold over the period.
Lynas (LYC) is an integrated source of rare earths from mine to customer. The company’s
resource deposit in Mt Weld, Western Australia. Lynas rare earth minerals are mined and
initially processed at the Mt Weld Concentration Plant. The materials are then shipped to
the Lynas Advanced Materials Plant in Kuantan, Malaysia for refining/concentration in order
to produce high quality rare earth oxides. Lynas is the only rare earths producer to produce
finished product outside China, which is a strategic advantage in global supply chains seeking
surety of supply outside China.
Ramsay Health Care (RHC) is a global health care company offering a range of acute and
services company with a solid and predictable outlook for earnings growth. Amongst some
of its healthcare peers, RHC offers a lower multiple with a PE of 22x, and ongoing earnings
growth in the mid-single digits. Growth continues to be generated through brownfields
expansion in Australia and a growing exposure to Europe and the United Kingdom.
Stockland (SGP) is a diversified property developer, owner and manager across retail
industrial, office, residential and retirement. Given the recent election result, APRA changes,
lower interest rates and a greater willingness for the banks to lend, it appears the residential
market in Sydney and Melbourne is seeing an inflection point and will begin to move higher.
Given Stockland’s exposure to the affordable housing market, they will be a major beneficiary
from the turnaround in pre-sales, which will be largely driven by First Home Buyers. Stockland
are also working towards deleveraging the balance sheet with the sell-down in retirement and
capital partnering in the retail and residential business.

unit prices
MacKay Shields Unconstrained Bond Fund
Period Fund Benchmark** Out/under

return* % Performance
% %
3 month 0.81 0.32 0.49
6 months 2.06 0.84 1.23
FYTD 0.81 0.32 0.49
CYTD 4.91 1.40 3.51
1 year 2.74 1.86 0.88
2 years pa 2.24 1.85 0.39
3 years pa 3.16 1.85 1.31
Since inception 4.14 1.87 2.27
Date:1 June 2016

** BofA Merrill Lynch 3-Month LIBOR Constant Maturity Index (AUD).

30 September 2019 1.027480 0.000000
* Redemption Ex-dist price
The Unconstrained Bond strategy delivered an attractive nominal USD return for the third quarter of
2019 due to falling interest rates. The quarter ended with September proving to be a favorable month
for Investment Grade Credit, led by BBBs and Financials; and High Yield, led by BBs and Bs.
The Fund is positioned in multi-asset credit, including investment grade corporate debt, unsecured
high yield bonds, emerging market debt and securitised assets. We took advantage of an attractive
new issue calendar to selectively add several new issuers to the portfolio while maintaining our
current risk posture. We utilised cash, Treasuries, and fully valued Investment Grade securities to
finance the purchases. Within Structured Credit, an active supply calendar provided the opportunity
to participate in a couple of high quality CMBS deals. Lastly, we added to Agency CMOs, which offer
better convexity as low rates and higher prepayment speeds presented attractive opportunities. At
an issuer level, US Treasury Inflation Protected, Citigroup and Southwestern Electric Power were
among the top performers during the period, while Textron, MPH Acquisition, and BANK 2019-
BNK21 lagged.
We took advantage of an attractive new issue calendar to selectively add several new issuers to
the portfolio while maintaining our current risk posture. We utilised cash, Treasuries, and fully valued
Investment Grade securities to finance the purchases. Within Structured Credit, an active supply
calendar provided the opportunity to participate in a couple of high quality CMBS deals. Lastly, we
added to Agency CMOs, which offer better convexity as low rates and higher prepayment speeds
presented attractive opportunities.
Investment grade corporate spreads, as measured by the Bloomberg Barclays US Corporate Index
remained flat for the quarter. All major sectors performed positively during the full quarter, led by
the utility and telecommunications sectors. Energy and financial institutions lagged the most for the
quarter, albeit still performing positively. We maintain a defensive posture within the investment grade
corporate allocation by focusing on shorter duration, higher quality and less cyclical industries.
High yield spreads, as measured by the Bloomberg Barclays US High Yield Index, tightened 4
bps during the quarter. In percentage terms, the high yield market returned 1.33% for the quarter,
underperforming investment grade corporate bonds. Financial institutions was the top performing
sector in terms of total return, while energy was the worst laggard. Generally, across the ratings
cohorts, higher quality issuers performed the best during the quarter, led by BB issuers. Notably,
most of our portfolios have little to no exposure to CCC and stressed issuers.

unit prices
The Credit Suisse Leveraged Loan Index (CSLLI) returned 0.92% for the third quarter as loans
participated in the risk asset rally during the period, but underperformed relative to more interest
rate sensitive asset classes. Returns across the market by rating demonstrated noticeable
dispersion, with B and above-rated loans generating positive returns (Split BBB was highest with
1.82%), and Split B and below generating negative returns (Distressed was lowest with -3.85%).
During the quarter, returns by sector were generally positive, with the exceptions of energy, metals
& mining, retail and shipping. The highest returning sectors were wireless communications (2.26%)
and broadcasting (2.20%), while the lowest were metals & mining (-4.15%) and energy (-3.94%).
Hard currency (USD denominated) emerging market corporates and quasi-sovereign credit
spreads, as measured by the Bloomberg Barclays EM Corporate & Quasi-Sovereign Index,
returned 2.11% for the quarter. Performance was mixed across the ratings cohorts, with CCC
issuers performing the best and CC to D performing the worst, delivering 6.60% and -5.77%,
respectively. During the quarter, Argentina was by far the sector’s worst performing country in
terms of total return, following an August market sell-off amidst default fears. Our process notably
favors a modest exposure to relatively conservative positions in state-backed businesses and
higher quality corporates.
Securitised assets, including residential mortgage-backed securities (RMBS) and consumer-

related asset backed securities (ABS), underperformed the overall return of the markets, as
measured by the Barclays Aggregate Index. These securities are generally higher rated and
shorter duration in nature. We tend to favor consumer receivables given the relative health of
consumer balance sheets, particularly compared to corporate balance sheets. We also believe
that select securitised assets may provide an attractive relative value alternative to higher quality
corporates trading at tight valuations.

unit prices
Ausbil Balanced Fund

% %
3 months 3.64 2.82 0.82
6 months 9.01 8.10 0.91
FYTD 3.64 2.82 0.82
CYTD 20.06 17.43 2.63
1 year 8.27 10.32 -2.05
3 years pa 10.62 9.96 0.65
5 years pa 9.56 9.08 0.48
7 years pa 11.70 10.18 1.52
10 years pa 9.12 8.27 0.85
15 years pa 8.62 7.66 0.96
20 years pa 8.05 7.14 0.91
Date: July 1997

** The Balanced Fund’s neutral Strategic Asset Allocation Return (assuming passive benchmark returns).

30 September 2019 1.587984 0.000000
The September quarter saw growth assets perform strongly as the major Central banks deployed
comprehensive monetary easing measures with geopolitics remaining a major concern, and
trade uncertainty continuing to undermine confidence.
The Balanced Fund outperformed for the September quarter 2019, returning +3.64% (net of
fees) versus the benchmark return of +2.82%. Over the past 12-months, the Balanced Fund
underperformed, returning 9.24% (gross of fees) versus the benchmark return of 10.32%. Value
add for the quarter was derived primarily from global and domestic equities.
The Balanced Fund strategy remains overweight growth, and slightly underweight defensive
assets, relative to its strategic benchmark.
The US/China diplomatic standoff sees any trade agreement in a state of flux, potentially up until
the November 2020 US Presidential election. A global easing cycle is underway to counter the
risks of uncertainty from further undermining global investor confidence, reducing trade volumes
and delaying capital investment plans. The macro-environment is supportive of global growth
recovering to trend levels as cash rates and bond yields remain lower for longer, whilst inflationary
expectations persist well below official target levels.
US GDP is expected to slow to 2.2% this year, and expand at its long-run trend of 2% in both
2020 in 2021. Eurozone growth is likely to slow to 1.3% with downside risk, before recovering
to its trend pace of 1.5% in both 2020 and 2021. Japan is expected to slow to 0.9% this year,
with October’s increase in the consumption sales tax, however, growth is expected to average
0.6% in both 2020 and 2021. China’s response to US tariffs with aggressive stimulus measures is
expected to see growth, at the low end of the official target range, at 6.1% out to 2021.
The Australian economy is gradually responding to the monetary and fiscal policy stimulus injected
since the Federal election. At this stage, further interest rate cuts are likely, and the implementation
of ‘quantitative easing’ as a policy tool cannot be ruled out. Forward policy guidance repeated that
an extended period of low interest rates will be required and that the Bank stands ready to ease
further in meeting their goals of full employment and inflation within target. The Australian dollar is
anchored, for now, at around 67 cents, with a downside break likely, should rate cuts continue.

unit prices
Ausbil Global SmallCap Fund

% %
3 months 0.37 3.15 -2.79
6 months 5.25 6.48 -1.23
FYTD 0.37 3.15 -2.79
CYTD 15.24 20.00 -4.77
1 year -4.28 1.47 -5.75
Date: 31 May 2018

** MSCI World SmallCap Net total Return (TR) Index in AUD.

30 September 2019 1.044754 0.000000
Performance Review
Portfolio performance for the quarter ending September 2019 was +0.37% (net of fees)
versus the benchmark return of +3.15%, as measured by the MSCI Small Caps Index.
Our stock selection in the Information Technology and Consumer Discretionary sectors
contributed negatively to relative performance. The fund has a bias to high quality
companies delivering unrecognised growth and positive earnings revisions, factors that
were not rewarded by the equity market over the period.
The Real Estate and Utilities sectors posted the strongest gains. The Energy and Materials
sectors lagged the index though the market did rotate away from high growth momentum
stocks towards cheaper cyclical companies in September. Towards the end of the quarter,
the US 10-year yield rose as bond markets sold off over the period. This caused equity
market participants to lower their perceived value of high growth stocks, and increase their
relative valuation of cyclical businesses.
Outlook
Although economic data continues to deteriorate, the major central banks around the
world have entered significant easing cycles. This accommodative central bank policy is
synchronised worldwide. Policy response has proved effective at improving the economic
outlook in the past, and the market will be buoyed by more fiscal and monetary stimulus
from central banks and governments.
Given that the deterioration in economic data will be somewhat offset or reversed by fiscal
and monetary stimulus, the key question for the global outlook centres on foreign policy, and
specifically the US/China relationship. Should the US and China find a way to deescalate
their relationship in the October trade meetings, the market may price in a return to growth
seen in 2017, and the market post higher highs into the year end. This would see cyclical
and value stocks continue to outperform, as happened in September. Should the US and
China continue to erode trust and escalate tensions, then the market may become more
fearful on economic growth prospects. In this scenario, defensive growth assets and bond
proxies should continue to deliver outperformance.

unit prices
Ausbil Global Essential Infrastructure Fund

% %
3 months 6.72 1.78 4.94
6 months 13.70 3.53 10.17
FYTD 6.72 1.78 4.94
CYTD 30.08 5.23 24.85
Since inception 29.09 5.53 23.56
Date: December 2018

** OECD G7 CPI Index +5.5%pa.

30 September 2019 1.252892 0.000000
Performance Review
benchmark return of +1.78, as measured by the OECD G7 Index plus 5.5%.
Whilst this was a strong quarter for Essential Infrastructure, there was a wide dispersion between
the four major sectors. Communications Infrastructure (mobile phone towers) was the stand-out
performer, rising over +13%, closely followed by Utilities which were up just shy of +12%. Transportation
Infrastructure (airports and toll toads) rose by just over +2%, whilst Energy Infrastructure (regulated and
contracted pipelines) gained around +1.6%.
Regionally, returns were more similar, with North America, the United Kingdom and Europe all up by
between +6% and +8%, whilst Australia lagged, still rising, but only by around +1.8%.
The main negative detractor to the fund this quarter was The Williams Companies, primarily a natural
gas pipeline company that owns Transco, a 10,000 mile (16,000 km) natural gas pipeline system
between South Texas and New York City, one of the premier pieces of North American infrastructure.
Williams fell in sympathy with low natural gas prices and opposition to the development of pipelines to
take natural gas into New York, where there is a shortage of natural gas supply.
There were eleven stocks in the portfolio that rose by over +10% during the quarter – mainly a mixture
of North American Utilities and Communications Infrastructure companies. NextEra Energy, a Floridian
utility which also owns the world’s largest generator of renewable energy (wind and sun), was the
stand-out performer rising by nearly 19%. NextEra is a core holding in the fund and one of our top
positions. The company is benefitting from a positive regulatory environment and also the continued
rise of renewables. This is driven by the cost of renewables being lower than conventional generation
across many regions, a significant inflexion point, and one that is particularly inspiring from an ESG
perspective.
Outlook
Whilst the recent performance of Essential Infrastructure has continued to be strong, the longer-
term outlook remains very attractive. A continued low interest-rate environment around the world is
supportive for infrastructure valuations and also makes the dividend yield of infrastructure companies
appear relatively more appealing.
The cash level at the end of the quarter was a touch over 5%. Markets have recently seen an increase
in volatility. We are therefore keeping some dry powder in order to allow us to take advantage of
mispriced opportunities, but also to provide a measure of downside protection if markets fall.
As always, our process identifies high quality companies that offer good risk-adjusted returns above
our absolute performance objective. We will continue to diligently and consistently apply our investment
framework on behalf of our investors, and to protect the capital that they have entrusted us with.

unit prices
Ausbil Global Resources Fund

% %
3 months -3.79 0.29 -4.08
6 months 11.03 0.74 10.30
FYTD -3.79 0.29 -4.08
CYTD 11.93 1.26 10.67
1 year -1.57 1.74 -3.31
Date: May 2018

** OECD G7 CPI Index +5.5%pa.

30 September 2019 1.013792 0.000000
Performance Review
Fund performance for the quarter ending September 2019 was -3.79% (net of fees), versus the
Fund benchmark return of 0.29% as measured by the Bloomberg AusBond Bank Bill Index.
Key contributors for the month were broad-based, coming from the Copper (primarily First
Quantum), Iron Ore (primarily Fortescue Metals), Steel (short scrap positioning) and Battery
Materials sectors (long Lynas and short Lithium). At a sector level, the key detractor was Energy,
with the attack on key Saudi oil infrastructure failing to improve the outlook for the sector.
Commodity prices were mixed during the month. Base Metals were mixed with Copper up
+0.7%, Nickel consolidating after recent gains, down -4.4%, Zinc up +9.8% and Lead up +5.7%.
Precious metals were largely weaker, with Gold down -3.2%, Silver down -7.5% and Platinum
down -5.4% during the month. Iron Ore was stronger, up 10.6% during the month, with other
bulk commodities mixed, with Metallurgical Coal down -7.1% and Thermal coal up +6.5%. WTI
and Brent oil prices were also mixed (down -1.9% and up +1.4% respectively).
Outlook
Commodities markets are likely to remain dominated by global trade concerns in the short term.
This will continue to drive uncertainty around the economic growth outlook, translating into
uncertainty around commodity demand. We remain cautious on positioning, given the recent
history of false starts in negotiations between the US and China. In part, these concerns around
economic growth are being offset by an increasing probability of interest rate cuts, targeted at
stimulating economic conditions.
The Fund’s main long exposure is currently to Iron Ore, which to some extent is isolated from
trade concerns, with bulk commodities less leveraged to global trade than base metals. If
anything, Iron Ore and other steel-making raw materials are likely to benefit in an extended trade
war, as China looks to stimulate economic growth through areas such as infrastructure and
property which are highly steel intensive. Given the volatility in markets, a significant proportion of
our Iron Ore positioning is protected by put options over names in our portfolio (limiting potential
downside).

Ausbil Investment
Management Limited
Level 27
225 George Street
Sydney NSW 2000
Australia
Toll Free 1800 287 245
Unless otherwise specified, any information contained in this publication is current as at the date of this report and is prepared by Ausbil Investment
Management Limited (ABN 26 076 316 473 AFSL 229722) (Ausbil). Ausbil Australian Active Equity Fund (ARSN 089 996 127), Ausbil Australian
Geared Equity Fund (ARSN 124 196 407), Ausbil Australian Emerging Leaders Fund (ARSN 089 995 442), Ausbil MicroCap Fund (ARSN 130 664
872), Ausbil Balanced Fund (ARSN 089 996 949), Ausbil Active Dividend Income Fund (ARSN 621 670 120), Ausbil Australian Concentrated Fund
(ARSN 622 627 696), Ausbil Active Sustainable Equity Fund (ARSN 623 141 784), Ausbil Global SmallCap Fund (ARSN 623 619 625), Candriam
Sustainable Global Equity Fund (ARSN 111 733 898), Ausbil 130/30 Focus Fund (ARSN 124 196 621), Ausbil Global Essential Infrastructure Fund
(ARSN 628 816 151), Ausbil Global Resources Fund (ARSN 623 619 590) and MacKay Shields Unconstrained Bond Fund (ARSN 611 482 243)
(collectively known as ‘the Funds’). Ausbil is the issuer of the Funds. This report contains general information only and the information provided is
factual only and does not constitute financial product advice. It does not take account of your individual objectives, financial situation or needs.
Before acting on it, you should seek independent financial and tax advice about its appropriateness to your objectives, financial situation and
needs. Securities and sectors mentioned in this monthly report are presented to illustrate companies and sectors in which the Fund has invested
and should not be considered a recommendation to purchase, sell or hold any particular security. Holdings are subject to change daily. The value
of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested. Past performance is not
a reliable indicator of future performance. Unless otherwise stated, performance figures are calculated net of fees and assume distributions are
reinvested. Due to rounding the figures in the holdings, breakdowns may not add up to 100%. No guarantee or warranty is made as to the accuracy,
adequacy or reliability of any statements, estimates, opinions or other information contained herein (any of which may change without notice) and
should not be relied upon as a representation express or implied as to any future or current matter. You should consider the Product Disclosure
Statement which is available at www.ausbil.com.au before acquiring or investing in any of our products.
Contactus@
ausbil.com.au

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Ausbil Funds Ausbil Investment

Unitholder Quarterly Report AFSL 229722

2 Ausbil Unitholder Report l September Quarterly 2019

Ausbil Unitholder Report l September Quarterly 2019 3

Ausbil Australian Active Equity Fund

Period Fund Benchmark** Out/Under

* Returns are after fees but before taxes.

Price* $ Distribution CPU

At a stock level, the overweight positions in Lendlease, Independence Group, JB Hi-

4 Ausbil Unitholder Report l September Quarterly 2019

Ausbil Unitholder Report l September Quarterly 2019 5

Ausbil Australian Geared Equity Fund

At a stock level, the overweight positions in Lendlease, Independence Group, JB Hi-

Price* $ Distribution CPU

6 Ausbil Unitholder Report l September Quarterly 2019

Ausbil Unitholder Report l September Quarterly 2019 7

Ausbil Australian Emerging Leaders Fund

Period Fund Benchmark** Out/Under

* Returns are after fees but before taxes.

Price* $ Distribution CPU

8 Ausbil Unitholder Report l September Quarterly 2019

Ausbil Unitholder Report l September Quarterly 2019 9

10 Ausbil Unitholder Report l September Quarterly 2019

Ausbil MicroCap Fund

Period Fund Benchmark** Out/Under

* Returns are after fees but before taxes.

Price* $ Distribution CPU

Ausbil Unitholder Report l September Quarterly 2019 11

12 Ausbil Unitholder Report l September Quarterly 2019

Significant Fund Activity

Ausbil Unitholder Report l September Quarterly 2019 13

Superloop (SLC) is a specialist telecommunications company with strategically positioned fibre

14 Ausbil Unitholder Report l September Quarterly 2019

Candriam Sustainable Global Equity Fund

Period Fund Benchmark** Out/Under

* Returns are after fees but before taxes.

Price* $ Distribution CPU

Ausbil Unitholder Report l September Quarterly 2019 15

Key Stock Contributors and Detractors

Amazon.com is an overweight position in the Consumer Discretionary sector, scoring well on

16 Ausbil Unitholder Report l September Quarterly 2019

Ausbil 130/30 Focus Fund

Period Fund Benchmark** Out/Under

Price* $ Distribution CPU

Ausbil Unitholder Report l September Quarterly 2019 17

Cleanaway Waste Management (CWY) is a leading Australian waste management company,

18 Ausbil Unitholder Report l September Quarterly 2019

Ausbil Active Dividend Income Fund

Period Fund Benchmark** Out/Under

Price* $ Distribution CPU

Ausbil Unitholder Report l September Quarterly 2019 19

20 Ausbil Unitholder Report l September Quarterly 2019

Ausbil Unitholder Report l September Quarterly 2019 21

Ausbil Australian Concentrated Equity Fund

Period Fund Benchmark** Out/Under

* Returns are after fees but before taxes.

Price* $ Distribution CPU

At a stock level, the overweight positions in Lendlease, Independence Group, JB Hi-Fi,

22 Ausbil Unitholder Report l September Quarterly 2019

Altium (ALU) is an Australian multinational software corporation that focuses on electronic

Ausbil Unitholder Report l September Quarterly 2019 23

Ausbil Active Sustainable Equity Fund

Period Fund Benchmark** Out/Under