# Fiske plc pleased with Ocean UK Equity Fund performance

- Link: https://www.directorstalkinterviews.com/fiske-pleased-with-ocean-uk-equity-fund-performance/412838757
- Published: 2020-07-02T12:47:57+01:00
- Author: Amilia Stone

**MONTHLY FACTSHEETat last valuation point in May 2020 unless otherwise stated

**MANAGER COMMENTARY**

May 2020 saw equity markets continue their recovery boosted by the co-ordinated 
monetary and fiscal stimulus measures deployed by central banks in order to keep
economies and confidence alive. In addition, with Covid-19 seeming to be coming 
under some semblance of control in Europe, there has been a general easing of the
lockdown measures and the partial reopening of economies. Portfolio companies are
taking measures to future proof their operations. Further issues are likely to arise
in winter when colder weather could cause another increase in Covid-19 infection
rates, subsequently forcing the authorities to implement further lockdown measures.
Similarly, the US Presidential election in November and the increasingly hostile
dialogue between the US and China over issues such
as Hong Kong and trade tariffs
will only act as a drag on markets.

We have now been managing Ocean UK Equity for two years – launched on the 14th of
May 2018 – and this is the third challenging economic period we have faced. The 
first was the sharp sell-off in Q4 2018. The second was the final third of 2019 
when domestic and value stocks rebounded and international stocks came under intense
pressure as sterling strengthened.
Now we are all facing the impacts of Covid-19
not only on domestic and commercial life but also particularly on the economy. During
each of these three different situations we have stayed calm and rational. We have
been reassured by the fact that we own a selection of quality companies that have
strong competitive positons and that are managed by teams who appear to navigate
difficult environments effectively and efficiently. The unit price is marginally
back over £1 and we are focused on trying to move it higher over the longer-term.
We are pleased with our relative performance, and thank all our coinvestors for 
their patience and continued support.

**COMPANY NEWS**

Intertek, the testing and quality assurance provider for items such as cargos as
they cross borders and checking the skills of workers who handle food, has released
a trading update. Revenues fell 4.6% across the group in the context of the market
anticipating a 10% decline. The final dividend is being paid, demonstrating the 
cash generative nature of the business. The balance sheet is strong with net debt
of circa £629m, which is roughly matched by its annual earnings before tax. During
the crisis it has developed a programme, Protek, which provides tailored health 
and hygiene testing for companies and government agencies, including hotel and restaurant
operators who are keen to provide reassurance to much needed returning customers.
The crisis should only accelerate the increasing trends towards greater quality 
control which provides interesting structural growth opportunities for Intertek 
and could increase its competitive position within the $250 billion global quality
assurance market.

Experian, the global information services company, released prelims for the year
ending 31st March 2020. Organic revenues were up +8% and, EPS up +3% whilst the 
dividend was held at the same level as 2019 and the balance sheet remains robust.
Since the year end, Covid-19 has had an impact across the business with trading 
in April down -5% and FY21 guidance has been withdrawn. Experian have implemented
a range of short-term costs mitigation actions such as directors taking a 25% pay
cut for six months. It has also helped small businesses in the US and the UK by 
providing free Experian credit reports. Operationally, the focus has been on maintaining
appropriate levels of organisational capacity in order to serve customers and communities
when conditions improve. Covid-19 has highlighted the fundamental importance of 
data and its value to society. Experian is in a strong position, and as the crisis
abates, they should continue to deliver long-term revenue and profit growth.

**INVESTMENT OBJECTIVE**

The Fund aims to achieve capital and income growth, and to provide a return (after
fees, charges and other expenses payable out of the Fund) in excess of that of the
CBOE UK All Companies Total Return Index over the long-term.

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