The Hague – April 2020 – The Juno Selection Fund ended the first quarter of 2020 with a net asset value of €346.90 per participation, a decrease of -15.9% since the end of last year. Whereas the fund, which specializes in investments in European small and medium-sized (family-owned) companies, ended 2019 with an excellent result of +33.8%, it now also has to face the consequences of the COVID-19 virus.

Over the past quarter, the EMIX Smaller Europe Index lost -27.7% and the AEX (dividend reinvested) also fell sharply by -19.8%. Since its inception in January 2008, the Juno Selection Fund has shown an average performance of +10.7% net per annum. This means that the fund is still well ahead of the EMIX Smaller Europe Index, which achieved a compound annual net result of +3.5% over the same period.

The pandemic that is currently gripping the world has forced Juno’s portfolio managers to intervene rigorously in the portfolio in February and March. Frans Jurgens, director and co-founder of Juno: “It is not our expertise to make macroeconomic forecasts, but we strongly believe that once we put this pandemic behind us, it will leave us with a very deep scar in the economy. In our opinion, demand for services and products will not suddenly bounce back and we must also consider the very large government deficits and resulting tax measures. With that scenario in mind, we have concluded that some Juno companies are now suddenly lacking their usual predictable earnings growth, a cornerstone of our investment policy. We have rigorously reduced or completely sold those positions. Fortunately, there are also companies that are barely affected and even a few that will take advantage of the current circumstances. We were able to act on share price weakness and selectively increase the holding of those companies in our portfolio”.

Lennart Smits, director and co-founder of Juno: “The timely switch in the portfolio to cash has certainly helped us in this past period. But especially the low dependency on economic cycles, a core selection criterion at Juno, makes our companies less vulnerable. We also benefited from the healthy financial structures of our companies: where cash on the balance sheet still cost money a few months ago and caused derision from bankers, our (family-owned) companies now hold the trump cards. Juno will try to continue to make smart, selective and disciplined use of the high volatility in the markets to get the cash we hold in the portfolio today back to work”.

The quarterly report can be found here and the most recent factsheet here.

About Juno Investment Partners

Juno Investment Partners was established in 2007 as a fully independent fund manager and has an AIFM license (as referred to in Section 2:65 of the Wft), issued by the Dutch regulator AFM. Juno specializes in the selection of exceptional listed (family owned) companies in Europe. Companies that are able to achieve predictable and stable earnings growth year after year are considered for investment. The selection process focuses on the return on invested capital, a low debt ratio and free cash flows of a highly predictable nature. The analysts/portfolio managers compile a highly concentrated portfolio of approximately fifteen companies that they identify, analyze and visit regularly. Selected companies remain in the portfolio for a longer time period (usually more than five years). All analysts/portfolio managers have themselves invested in the Juno funds.

Juno offers three products: The Juno Selection Fund, which focuses on the selection of smaller and medium-sized listed companies, the Juno Continuation Fund for medium-sized companies and individual asset management using the same investment style, for larger clients through managed segregated accounts.

– The Juno Selection Fund was launched in 2008. This mutual fund invests in distinctive European small and medium-sized companies with an initial market capitalization of €250 million to €4 billion. In recent years, this investment style has resulted in above average investment returns for participants in the Juno Selection Fund. This fund has been hard closed for further (follow on) subscriptions since 2018.

– The same investment strategy is applied in the Juno Continuation Fund, which was launched on February 1, 2020. This fund focuses on unique, medium-sized European companies with a market value between €4 billion and €20 billion at the time of initial purchase. As is the case with the Selection Fund, the Continuation Fund also has a strong preference for investments in businesses that are family owned, or companies in which a family or management itself is also a shareholder.