Annual Shareholders Meeting 2006 Chairmans Review As at 31 March - - PDF document

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Annual Shareholders Meeting 2006 Chairmans Review As at 31 March - - PDF document

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Annual Shareholders Meeting 2006 Chairmans Review As at 31 March 2006 Net Asset Value up 24% to $1.5888 $18.8 million surplus after taxation Total increase in NAV per share since IPO of 64% NAV increase of 24% vs. 14% benchmark increase

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SLIDE 1

2006 Annual Shareholders Meeting

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SLIDE 2

Chairman’s Review

As at 31 March 2006

Net Asset Value up 24% to $1.5888 $18.8 million surplus after taxation Total increase in NAV per share since IPO of 64% NAV increase of 24% vs. 14% benchmark increase Combined market value of shares and warrants 36% above the issue price Core portfolio of 7 stocks established, with 96%

  • f funds invested
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SLIDE 3

Chairman’s Review

Update since balance date

31 March 2006 30 June 2006 Net Asset Value increase from initial IPO level of $0.97 64% 84% Net Asset Value increase versus Benchmark increase 24% 14% 12% 9% Increase in combined value of shares and warrants over issue price 36% 56% Dividend paid / payable 2cps 2.5cps Dividends reinvested 38% 37%

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SLIDE 4

Chairman’s Review

Share price and NAV performance

SHARE PRICE, COMBINED WARRANT AND SHARE PRICE AND NET ASSET VALUE PERFORMANCE

$0.80 $1 .00 $1 .20 $1 .40 $1 .60 $1 .80 M ar- 04 M ay- 04 Jun- 04 Jul- 04 A ug- 04 S ep- 04 Oct- 04 N

  • v-

04 D ec- 04 Jan- 05 F eb- 05 M ar- 05 Apr- 05 M ay- 05 Jun- 05 Jul- 05 A ug- 05 S ep- 05 N

  • v-

05 D ec- 05 Jan- 06 F eb- 06 M ar- 06 Apr- 06 M ay- 06 Jun- 06

KFL + KFLWA Price KFL NAV KFL Price

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SLIDE 5

The Kingfish Board is pleased to declare a fully imputed Special Dividend of 2.5 cents per share, payable 4th August 2006 based on eligible shares held

  • n 21st July 2006.

Chairman’s Review

Special Dividend Announcement

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SLIDE 6

Manager’s Review

Carmel Fisher Fisher Funds

Another year of impressive performance A portfolio of quality businesses Good results in spite of a challenging climate

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SLIDE 7

Agenda

Review of March 2006 year Review since balance date Outlook for March 2007 year Dealing with the discount

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SLIDE 8

Manager’s Review

Portfolio activity during 2006 year Trophies landed

Michael Hill Ryman Healthcare Software of Excellence

Caught and released

Just Water Pod Turners Auctions Turners & Growers Steel & Tube

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SLIDE 9

Our performance

exceeded a buoyant share market

Resilient and growing

profits in our companies

Ryman Healthcare

and Mainfreight were star performers, each lifting more than 70% in twelve months

The financial year

began badly with an 11% drop in NAV in April 2005

We exited Turners

Auctions after they failed to meet our growth expectations

Highlights: Lowlights:

Manager’s Review

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SLIDE 10

Where did our performance come from?

Year to 31 March 2006

  • 3%
  • 2%
  • 1%

0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%

C a d m u s T e c h n

  • l
  • g

y C

  • m

v i t a F r e i g h t w a y s J u s t W a t e r K i d i c

  • r

p M a i n f r e i g h t M e t l i f e c a r e M i c h a e l H i l l N Z E x c h a n g e P

  • d

P u m p k i n P a t c h R y m a n H e a l t h c a r e S

  • f

t w a r e S t e e l & T u b e T u r n e r s A u c t i

  • n

s T u r n e r s G r

  • w

e r s W a s t e M a n a g e m e n t

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SLIDE 11

Year-end Portfolio

Freightways 12% Cadmus 1% Kidicorp 1% Comvita 1% NZ Exchange 2% Software of Exc 1% Cash 2% Mainfreight 15% Waste Management 17% Ryman Healthcare 18% Metlifecare 10% Michael Hill 9% Pumpkin Patch 11%

Kingfish portfolio at 31 March 2006

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SLIDE 12

Manager’s Review

Review since balance date

NZ share market was lower for the quarter, weighed down by Telecom News flow was mediocre rather than alarming Kingfish NAV per share increased 14% from $1.5888 at 31 March to $1.7825 at 30 June, allowing for 2.5cps div paid on 16 June 13 of the 14 stocks in portfolio had share price gains, just Freightways declined 2% Strong profit results from retirement village stocks Ryman Healthcare and Metlifecare led to share price gains of 28% and 30% respectively

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SLIDE 13

Where did our performance come from?

3 Months to 30 June 2006

  • 1%

0% 1% 1% 2% 2% 3% 3% 4% 4% 5% Ryman Healthcare Metlifecare Mainfreight Rakon Pumpkin Patch Delegats NZ Exchange Comvita Michael Hill Waste Management Kidicorp Software Cadmus Technology Freightways

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SLIDE 14

Manager’s Review

Review since balance date

We were pleased to participate in Rakon and Delegats IPOs The Waste Management amalgamation was completed during the quarter and the shares de-listed late June The Board utilised the Kingfish debt facility to enable purchases of Delegats and Rakon ahead of the Waste Management proceeds being received We purchased additional Rakon, Delegats, Pumpkin Patch and Michael Hill Buy back continued with 2.65m purchased at an average price of $1.06 , and 3.3m warrants at an average price of $0.19 as at 30 June 2006

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SLIDE 15

Manager’s Review

Outlook for year ahead

We remain very comfortable with the outlook for the portfolio Many of our companies have significant

  • ffshore operations (eg. Michael Hill, Pumpkin

Patch) which will protect earnings from slowing NZ economy We have been vigilant in trying to find looming problems or surprises, and believe the coast is clear We continue to believe that good companies will perform in good times and bad

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SLIDE 16

Manager’s Review

Dealing with the discount

The most appropriate measure of the skill of the Manager is the growth in the NAV However, the share price performance continues to lag that of the NAV Why does the discount prevail?

– Poor performing investment manager? – Poor outlook for underlying companies? – Obscure or illiquid portfolio of investments? – Structure of Kingfish is expensive or unwieldy? – Out of sight, out of mind? – Dilutionary impact of warrants?

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SLIDE 17

Manager’s Review

Dealing with the discount

What has the Kingfish board/manager done to ‘manage’ the discount?

– Buyback of 1.5m shares representing 2.5% of Kingfish shares on issue – Encouraged share broker analysts to review the company – positive research reports produced by First NZ Capital – Developed a media campaign to promote coverage of Kingfish (more work still to be done in this regard) – Most importantly, managed the portfolio to ensure that the NAV moves in the right direction! – The discount has closed from 19% in October 2005 to 12% in June 2006

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SLIDE 18

Manager’s Review

A reiteration of why Kingfish remains attractive

Transparency Consistent investment performance Portfolio of great stocks through one investment Share price performance Corporate governance Discount not unusual Discount provides opportunity

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SLIDE 19

Manager’s Review

A reiteration of why Kingfish remains attractive

“For those who believe that the NZ sharemarket has longer term growth prospects, that the company’s core shareholdings will continue to prosper and that Fisher Funds will continue to excel at stockpicking, then Kingfish shares at current prices should be seen as a highly appropriate way to access that upside potential.”

Barry Lindsay, First NZ Capital Kingfish Research Note 21 June 2006

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SLIDE 20

Manager’s Review

Thank you for your continued support

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SLIDE 21
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SLIDE 22

Kingfish Proxy Summary

Resolution For Against Discretionary Abstain Total

  • 1. Re-elect Rob

Challinor 2,285,644 74,975 3,289,566 10,210 62,366 250 5,660,395

  • 2. Revocation and

Adoption of New Constitution 2,275,707 16,476 3,305,846 5,660,395

  • 3. Re-appointment
  • f PWC

2,296,106 62,366 3,301,673 5,660,395