01 Investment Process

Our
investment process emphasises both bottom-up and top-down research, using quantitative and qualitative processes to filter investment worthy businesses.

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02 Forensic Analysis

Our
investment approach focuses our capital on our best ideas.

We are patient and highly selective in the investments we choose. We are under no pressure, time constraints or institutional imperative to force investment decisions. Patience pays in this business.

Business Quality

  • Is the business solving a worthy problem
  • Industry fundamentals. Durability of business
  • Quality earnings, ROIC, ROE and FCF growth
  • Competitive advantages, internally funded growth
  • Pricing power advantages
  • Brand loyalty and low customer turnover
  • Quality resource allocation

Management Quality

  • Have exceptional leadership skills and integrity
  • Look at shareholders like silent partners
  • Independent thinkers that are indifferent to Wall Street's short-term narratives
  • Nurture high performance and accountability
  • Compensation is proportionate to the value
  • Management invest in their people, creating a strong company culture

Robust Capital Structure

  • Debt and equity must support the strategy
  • A well capitalised business
  • Minimal or proportionate leverage
  • Free cash returns in excess of cost of capital
  • Sustainable scale. Long term business growth potential
  • Financial flexibility and fiscal discipline

Reinvestment Quality

  • Pattern of disciplined reinvestment
  • Extensive opportunities to reinvest free cash flow organically or through acquisitions.
  • Strong reinvestment rates of return
  • Can the business grow with internal free cash without further need to raise capital from the markets.
  • Long term scale in markets where capital is reinvested

Accounting Integrity

  • Making ongoing adjustments in the areas of accounting that require rebalancing
  • Stock Options accounting
  • Cost of Dilution
  • Cost of compensation to ancillary service providers
  • Implications of overstated short term profitability
  • Unfunded obligations
03 Qualitative Analysis