Juno Selection Fund

Juno Selection Fund: Q4 2016

Juno Selection Fund managed to finish the year in the black and remains positive about the future

  • Underlying companies continue to show excellent operational performance
  • Total return since inception of +206% keeps market indices and peers at a distance
  • Juno lags market performance due to Trump-rally but manages to end the full year in the black with +2%.

Wassenaar – January 25, 2017 – The Juno Selection Fund, specialized in investments in European small- and midcap  (family-owned) companies, has managed to end 2016 with a positive result and closed 2% higher than the previous year. The equity markets have shown a a good performance since Trump’s election, but this resulted mainly from increased interest in cyclical sectors and financial values. This was at the expense of the high quality growth companies in Juno’s portfolio. The final quarter therefore ended with a -1% return. Over the full year 2016, Juno performed in line with the Euromoney Smaller Europe Index, returning +2%.

Total return since inception of the fund now stands at +206%. Over 2016, the assets under management in the fund once again strongly increased. With more than eighty new participants during the year, the total number of clients invested in the fund rose to 280, entrusting us to manage over €170 million in assets.

•    Return 2016: +2%

•    Return Q4 2016: -1%

•    Average annual return over the past five years: +20.2%

•    Assets under management in the fund 170 million euro*

Despite the less easily predictable economic and political developments in Europe and the rest of the world, Juno’s portfolio management team’s outlook for 2017 remains positive. Conversations with our portfolio companies’ management teams underline this confidence and they confirm that they should be able to generate a predictable earnings growth again this year. It is expected that the group of companies Juno is invested in, taken as a whole, will achieve growth between 10% and 15%. However, the portfolio companies’ earnings growth will not be translated into higher share prices in a predictable, direct linear fashion. According to Juno’s investors, this. This therefore offers attractive opportunities for patient and disciplined investors with a long term focus.

Frans Jurgens, director and co-founder of Juno: “Against a 2% earnings growth for the European market as a whole, the Juno Selection Fund portfolio companies were able to report an increase in earnings of (an expected) 12%. As the fund’s net asset value increased by only 2% in 2016, the portfolio became 10% less expensive over the year. Add that to the prospect of a predictable, healthy 10-15% earnings growth for 2017, and it becomes clear why we remain consistently positive about the coming year, and indeed the longer term.

Lennart Smits, director and co-founder of Juno: “Apart from new participants, the assets in the fund also increased because existing participants decided to entrust us with a larger part of their assets. Existing clients, making add-on investments, accounted for 40% of the inflow of these new assets. We consider this a token of continued trust in Juno, and carry this great responsibility with pride.”

*In total, Juno Investment Partners manages 240 million euro in this strategy, both through the Juno Selection Fund and via direct mandates from institutional clients.

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.

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