BB Entrepreneur Europe (Lux)
Owner-operated or family-run companies think in generations, not in quarters
Solid balance sheets, high innovative strength and safety awareness have a positive effect on the share price
Companies impress with high ESG scores
Please find a more detailed description of share classes here.
The Fund invests in listed owner-managed companies in Europe where an entrepreneur or a founder family holds at least a 20% of a company’s voting rights, thereby exerting significant influence. The Management Team pursues a fundamental, bottom-up approach in identifying the most attractive founder-controlled companies while maintaining an investment portfolio diversified by country and sector.
Indexed performance (as at: 24.09.2021)
NAV: EUR 154.44 (23.09.2021)
Rolling performance (23.09.2021)
|23.09.2020 - 23.09.2021||29.88%||32.84%|
|23.09.2019 - 23.09.2020||-2.05%||-5.75%|
|23.09.2018 - 23.09.2019||-9.06%||4.49%|
Annualized performance (23.09.2021)
|Since Inception p.a.||5.70%||7.82%|
Cumulative performance (23.09.2021)
Facts & Key figures
The Fund invests in listed owner-managed companies in Europe where an entrepreneur or a founder family holds at least a 20% of a company’s voting rights, thereby exerting significant control and influence. The typical qualities of these companies – a focused business model, fast decision-making processes, sustainable business policies and a strong corporate culture – go hand in hand with efficient innovation, high product quality and strong customer loyalty. The corresponding impact on the share price is demonstrably positive. The Fund’s Management Team offers a wealth of experience in this investment segment and has built up an extensive network with executives throughout the sector. It pursues a fundamental, bottom-up approach in identifying the most attractive founder-controlled companies with a small, mid as well as large market capitalization while maintaining an investment portfolio of 30 to 40 stocks diversified by country and sub-sector.Show moreShow less
Investment suitability & Risk
|Investment Manager||Bellevue Asset ManagementAG|
|Custodian||RBC Investor Services, Luxembourg|
|Fund Administrator||RBC Investor Services, Luxembourg|
|Year end closing||30. Jun|
|NAV Calculation||Daily "Forward Pricing"|
|Cut of time||15:00 CET|
|Subscription Fee (max.)||5.00%|
|Total expense ratio (TER)||2.25% (31.08.2021)|
|Legal form||SICAV Luxembourg jurisdiction|
|SFDR category||Article 8|
Key data (31.08.2021, base currency EUR)
|No. of positions||46|
Top 10 positions
Breakdown by sector
Opportunities & Risks
- Owner and family-run businesses think in generations, not in quarters.
- Focus, a sense of responsibility, strong identification with the company, and personal financial commitment have a positive impact on the share price.
- More conservatively financed, lower debt exposure and a higher risk capacity compared to non-family businesses.
- Multi-award-winning management team with a long and successful track record investing in owner-run firms.
- Entrepreneurs for entrepreneurs – the Bellevue Group is itself an owner-run company with the majority of shares held by employees.
- The fund invests in equities. Equities are subject to price fluctuations and so are also exposed to the risk of price losses.
- The fund may invest a proportion of its assets in financial instruments that might under certain circumstances have a relatively low level of liquidity, which can in turn affect the fund’s liquidity.
- The fund invests in foreign currencies, which means a corresponding degree of currency risk against the reference currency.
- Succession planning poses an additional risk for owner-run companies.
- The fund may engage in derivatives transactions. The increased opportunities gained come with an increased risk of losses.
Review / Outlook
European equities, as measured by the SXXR, returned 2.2% in August. Despite the slowdown in global growth momentum caused by the Delta variant as well as some tightness in supply chains, markets were underpinned by the outstanding reporting season and the more relaxed stance of Central Banks. In term of macro surveys, the Eurozone PMI Composite slightly eroded to 59.5 in August from 60.6 in July. Eurozone inflation rose to 3%, above expectations of +2.7%, with limited impact on yields yet, suggesting that the narrative for temporary inflation remains the central one. In terms of sectors, information technology (+7.0%), utilities (4.0%) and healthcare (+3.4%) performed best, while Consumer discretionary (-2.3%), consumer staples (+0.3%) and materials (+0.6%) lagged the most.
Against this backdrop, the fund was flat, underperforming the SXXR by 217 bps. Main detractors in the month were Swatch (-15.2%), GN Store (-13.8%) and Richemont (-13.5%). Recent China news flow took a toll on luxury sector, which was down double digit during the month. In focus was President Xi Jinping’s comments emphasizing the need for “common prosperity” and mentioning plans to regulate and redistribute excessive wealth. While Chinese nationals represent a third of global luxury spend, the emerging middle class is a lot more important than UHNWIs, who represent ca. 5% of spend. The overall insecurity led to some profit taking after a strong ytd performance. We lowered our overall sector exposure in the wake of the news. Although up 49%, GN Store Q2 sales missed estimates due to a sequential slowdown in Audio (+32% after +82% at Q1) and market share loss in Hearing (+95%, but still 10% below Q2 2019). Profitability was also below expectations due to lower sales and higher R&D and freight costs. We deem the stock attractively values at these levels.
Top contributors in the month were Merck (+16.5%), ASM International (+9.9%) and Novo Nordisk (+8.8%). Merck reported Q2 results 2% above on revenues, 8% on EBITDA and 9% on EPS, driven by beats in both Healthcare and Life Science divisions. FY21 guidance was raised promoting further positive revision of the consensus. ASM Int. share price continued its upward trend following Q2 results having shown revenues at the top end of expectations and very strong orders. Worth noting was the 48% gross margin, once again above the historical official “low-to-mid 40%” range, suggesting that high 40ies% may become ASM Int. new normal. Novo Nordisk, the Danish drug maker raised its 2021 sales and profit forecasts, reflecting higher than expected Q2 results and strong demand for Wegovy, its new obesity medication recently launched.
While the absolute valuation level of the equity market is high, it is absolutely warranted by the low interest rate environment, the stance of Central Banks and the amount of liquidity in the system. Money supply today is higher than before the pandemic. Interestingly, forward P/E’s multiples have declined in Europe as positive EPS revisions are running quicker than market prices. On average and despite the strong market performance, 12 mn forward P/E’s have contracted since the start of the year. Central Bank’s are modulating their exit strategies considering the Delta slow down and reemployment trends, which should promote a slower but longer lasting recovery. Our portfolio is therefore exposed to ca. 35% Value and 65% Growth with a continuous focus on fundamental stock picking.
Past performance is not a reliable indicator of future results and can be misleading. As the sub-fund is denominated in a currency that may differ than an investor’s base currency, changes in the rate of exchange may have an adverse effect on prices and incomes. Performance is shown net of fees and expenses for the relevant share class over the reference period. All performance figures reflect the reinvestment of dividends and do not take into account the commissions and costs incurred on the issue and redemption of shares, if any. Individual costs are not taken into account and would have a negative impact on the performance. With an investment amount of EUR 1,000 over an investment period of five years, the investment result in the first year would be reduced by the front-end load of up to EUR 50 (5%) as well as by additional individual custody charges. In subsequent years, the investment result would also be reduced by the individual custody account costs incurred. The reference benchmark of this class is used for performance comparison purposes only (dividend reinvested). No benchmark is directly identical to a sub-fund, thus the performance of a benchmark is not a reliable indicator of future performance of the sub-fund it is compared to. There can be no assurance that a return will be achieved or that a substantial loss of capital will not be incurred. All figures in base currency in %, calculated by the total return / BVI method.Show moreShow less