Artemis UK Special Situations Fund
Fund Manager's Comment
Data as at 30 April 2012
Unilever is one of our older holdings in terms of management change. However it has lost none of its excitement or potential. Paul Polman took over a business that was already changing, but he has pushed it further. The results: group revenue growth of 8.4% in the first quarter, with its emerging markets business delivering nearly 12%. This is a great achievement in a world where growth is not as abundant as it used to be and it is a testament to the company’s management team and brands. We continue to hold the shares and look forward to continued growth.
From the old to the new. We initiated a holding in specialty chemical producer AZ Electronics earlier last year. The position had until recently remained modest, reflecting difficult trading in the semi-conductor market and the overhang of stock from the venture capitalists that brought it to market. We have recently doubled our position following the placing of the last of this overhang and on the belief that recent lacklustre trading will improve. The company’s chemicals are used to enhance the functionality of integrated circuits, flat panel displays and LEDs. These are in turn supplied to the producers of computers, tablet devices and flat screen televisions. These are structural growth markets which are impacted over short time periods by the cyclicality of the semiconductor market. The company enjoys high market shares and this, combined with the low overall cost of their chemicals as a percentage of their customers’ costs, allows them to earn a very healthy margin. These attributes should support a much higher rating on the shares.
Finally we conclude with the end of a long saga. Omega Insurance seems to have been in more bid situations than the rest of the stock market put together. None has so far succeeded in a takeover of the company. Hopefully the current offer on the table will be the real deal. On completion of the transaction we may crack open a bottle of fizz – not to rejoice at a profitable outcome but in celebration that the company will no longer be on the valuation of the fund.
Fund Manager
Derek Stuart
Manager of the Artemis UK Special Situations Fund Fund since launch
Co-Fund Manager
Ruth Keattch
Co-Manager of the Artemis UK Special Situations Fund Fund since 1 December 2008
Awards
UK Special Situations PDFKey Facts
| IMA Sector | UK All Companies |
|---|---|
| Sedol Number | 0219226 |
| Fund Size (offer basis) | £1040.3m |
| Historic yield | 1.4% |
| Unit offer price | 384.44p |
| Unit bid price | 360.67p |
| Valuation (UK business days) | 12:00 |
| Minimum lump sum investment | £1,000 |
|---|---|
| Minimum monthly investment | £50 |
| Launch | 9 March 2000 |
| Launch price | 100p |
| Preliminary charge | 5.25% |
| Annual Management Fee | 1.50% |
| Unit type | Accumulation |
| Accumulation date | 28 February |
| Total Expense Ratio | 1.57% |
Data as at 30 April 2012.
Performance
| Since Launch* | 5 Years | 3 Years | 1 Year | 6 Months | |
|---|---|---|---|---|---|
| UK Special Situations Fund (TR)† | 279.6 | 3.5 | 42.6 | -4.3 | 5.1 |
| FTSE All-Share (TR)† | 41.6 | 6.5 | 52.2 | -2.0 | 6.3 |
| FTSE 100 (TR)† | 32.3 | 7.2 | 50.4 | -2.0 | 5.5 |
| Sector Average | 32.6 | 0.7 | 49.9 | -2.4 | 5.9 |
| Position in Sector | 1 | 111 | 214 | 222 | 161 |
| Funds in Sector | 136 | 251 | 273 | 288 | 291 |
| Quartile | 1 | 2 | 4 | 4 | 3 |
Please remember that past performance is not a guide to the future.
* Data from 9 March 2000. Source: Lipper Limited, bid to bid in sterling with net income reinvested to 30 April 2012. All figures show total returns. †Percentage Growth. Sector is IMA UK All Companies.
Percentage Growth
Artemis UK Special Situations Fund Fund 12 Months to 31 December 2009
| 2012 | 2011 | 2010 | 2009 | 2008 |
|---|---|---|---|---|
| -0.8 | 14.6 | 40.5 | -22.5 | -12.5 |
Source: Lipper Limited, bid to bid in sterling with net income reinvested. All figures show total returns.
Value of £1,000 invested at Launch to 30 April 2012.
Data from 9 March 2000. Source Lipper Limited, bid to bid in sterling with net income reinvested to 30 April 2012.
Asset Allocation*
*Without cash. Source: Internal
Top Ten Holdings*
| BP | 4.9% |
|---|---|
| BT | 4.4% |
| ITV | 4.2% |
| GlaxoSmithKline | 4.2% |
| Micro Focus | 3.7% |
| Unilever | 3.2% |
| Devro | 3.2% |
| BG Group | 3.1% |
| Smith & Nephew | 3.1% |
| Premier Oil | 3.1% |
* Without cash.
Source: Internal.
Market Sector Split*
| Industrial Goods & Services | 19.2% |
|---|---|
| Oil & Gas | 17.5% |
| Healthcare | 13.7% |
| Media | 9.4% |
| Food & Beverage | 8.9% |
| Technology | 8.1% |
| Insurance | 5.2% |
| Telecommunications | 4.4% |
| Travel & Leisure | 3.7% |
| Other | 9.9% |
* Without cash.
Source: Internal.
% Variance†*
† Positive variance between stock % held in the Fund versus FTSE All-Share.
Risk Warning
Issued by Artemis Fund Managers Ltd which is authorised and regulated by the Financial Services Authority (www.fsa.gov.uk), 25 The North Colonnade, Canary Wharf, London E14 5HS and is a member of the IMA. Artemis Fund Managers Ltd is a member of the Artemis Marketing Group. We only market our own unit trusts. The value of an investment, and any income from it, can fall as well as rise as result of market and currency fluctuations and you may not get back the amount originally invested. Investment in the securities of smaller and/or medium sized companies can involve greater risk than is customarily associated with investment in larger, more established companies. The market for securities in smaller companies is often less liquid than that for securities in larger companies, meaning above average price movements both positive and negative can be expected.
All data is sourced internally unless otherwise stated.
The historic yield reflects distributions declared over the past twelve months as a percentage of the mid-market unit price, as at the date shown. It does not include any preliminary charge and investors may be subject to tax on their distributions.
