Investment Matters

Portfolio changes: CML and Australasian Foods

Clients will notice two changes to their portfolios in the past week.

We have added a short term investment in CML Group debt to clients' equity portfolios.  CML Group is trading very strongly, and as a result we have taken a limited opportunity to invest in their debt (for up to 12 months).  This investment will yield a cash interest return of 9% p.a. for its duration, helping boost income. 

Unfortunately we do not expect this investment to last more than a year as the company is likely to seek to refinance its entire debt package to a new larger facility to set them up for the next several years growth.  We remain very comfortable with the performance and outlook for CML Group.

Those clients with an Alternative allocation will notice the addition of Australasian Foods Holdco Proprietary Limited Class B to their portfolio.  This is the remaining holding of what was Patties Foods Ltd, which we have elected to follow in its unlisted (private) form under the control of Pacific Equity Partners. 

We expect this to be in clients' portfolios until such time as 'Patties' relists or is transacted (i.e. sold) by PEP.  We remain very comfortable with its prospects (and the prospects of PEP building an even better business, for you).