selector march 2013 quarterly newsletter
TRANSCRIPT
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8/13/2019 Selector March 2013 Quarterly Newsletter
1/19
In this quarterly edition we review performance and attribution. We do a roundup of the recent reporting season. Our macro focus is on the new global war. At home we take a look at the Federal Government and our miners and finally we discuss some global developments in executive pay. Photo: Currency Wars.
Selector Funds Management Limited ACN 102756347 AFSL 225316 Level 3, 10 Bridge Street Sydney NSW 2000 Australia Tel 612 8090 3612 www.selectorfund.com.au
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8/13/2019 Selector March 2013 Quarterly Newsletter
2/19
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8/13/2019 Selector March 2013 Quarterly Newsletter
3/19
March 20
Selector ACN 102Level 3, Telepho
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Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
vestor,
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Newsletter #33
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-
8/13/2019 Selector March 2013 Quarterly Newsletter
4/19
March 20
Selector ACN 102Level 3, Telepho
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.au
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-
8/13/2019 Selector March 2013 Quarterly Newsletter
5/19
March 20
Selector ACN 102Level 3, Telepho
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Newsletter #33
.au
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-
8/13/2019 Selector March 2013 Quarterly Newsletter
6/19
March 20
Selector ACN 102Level 3, Telepho
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13 Selector Aus
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and AMP. S
Newsletter #33
.au
Top 5 stPharmax
Sirtex M
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test reporti
d a number
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quarter wer
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-
8/13/2019 Selector March 2013 Quarterly Newsletter
7/19
March 20
Selector ACN 102Level 3, Telepho
Reporti
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13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
ng season ro most part,
lders on ho
ment to spi
are down.
e surprises.
y and prepa
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he heading
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Newsletter #33
.au
es business
e say for t
stor wants t
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ooking up ra
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-
8/13/2019 Selector March 2013 Quarterly Newsletter
8/19
March 20
Selector ACN 102Level 3, Telepho
1. SAI Busine
with in
improv
endors
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13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
lobal (SAI): ss backgroun
SAI Glob
ormation ser
ment.” Eve
s independ
onto the sto
ks of a great
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require cons
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give
m
it stumble
Newsletter #33
.au
capitalisatio
usiness as “
naging risk,
SAI would r
cts and serv
was much to
opoly and an
or execution
s of acquisiti
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ly a
the
-
8/13/2019 Selector March 2013 Quarterly Newsletter
9/19
March 20
Selector ACN 102Level 3, Telepho
2. Jum Busine
activiti
online l
largest
playing
busines
billion
wager t
For gov
in tech
provide
Australi
relation
a risk t
cannot
In the
current
global
lottery
require
Our vieWe ack
their c
investe
remain
3. IRES
Busine
who op
core o
market
and ma
of the
the low
A case i
of mon
excelle
13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
o Interactivs backgrous, other tha
ottery busin
shareholder
in much the
s is valued a
f this total. I
o earn a con
ernments it r
ology, the
rs to
exploit
a, Jumbo ha
ship with lot
hat future a
be ruled out,
ean time, t
cash balanc
arkets of th
playing is gr
ments are rel
w nowledge th
re compete
d in Jumbo s
on board.
(IRE): shars backgrounerate in fina
fering as a
s. The busine
rket incumb
usiness des
er full year r
n point is th
ey to execut
t financial o
tralian Equities
ent Limited 5316 Sydney NSW 22 Web www.se
(JIN): share d : The na
to suggest
ss that has
Mike Vever
same way th
$250 billio
mportantly, l
iderable pay
epresents a
mergence o
this significa
built a $100
tery provide
greements
although th
e business
e of $16 mil
e US, Mexic
wing in size
atively small
at the risks i
cy, remaine
me time ba
e price $7.75
: We profile
cial markets
leading soft
ss has evolv
ncy. Manag
ite the shor
ported profi
group’s pre
e the plan.
tcomes wit
Fund Quarterly
00, Australialectorfund.com
price $2.50 |
e Jumbo In
something b
een in oper
a is successf
at online has
, while onlin
ottery playin
out, despite
aluable sou
online playi
nt global
op
million loca
Tatts Grou
ay not be
group is pr
as grown ra
lion, CEO Ve
and Germa
and Jumbo s
and the busi
n Jumbo are
d debt free
ck and despi
|market cap
d the IRESS b
or financial
are supplie
d since its fo
ment is
not
term finan
t for 2012.
paredness t
his is a stra
out taking u
Newsletter #33
.au
market capi
teractive gi
ig. In short,
tion for ove
ully exploitin
emerged in
e is currentl
g is played s
he long odd
ce of revenu
ng has open
ortunity. Fr
l online lotte
under existi
enewed. M
pared shoul
pidly over th
verka has m
ny. These ar
eems to hav
ness is in str
higher but a
nd executed
e the strong
italisation $9
usiness in ou
lanning busi
r of service
unding in 19
ashamed of
ial impacts t
target new
egy that has
due risk. To
alisation $1
es little aw
the compan
a decade. T
g the growi
most walks
in its infan
cially and a
.
e and in kee
ed the door
m its
origins
ry business.
ng reseller a
nagement i
this ever ev
e past five y
oved to sec
early days
e a well tho
ng shape to
lso note tha
on a strate
move in the
92 million
r March 201
nesses woul
and tradin
93 and impo
oing what’s
hat such dec
overseas ma
served the
ay, the IRES
0 million ay to the g
has develo
he group’s fo
g adoption
f life. The to
y and repre
cepted for
ing with the
for Jumbo a
stretching
s
he group en
greements, a
candid tha
entuate.
ears and wit
re new opp
but the onli
ght out stra
undertake th
manageme
y that appe
company’s
quarterly n
be familiar
g platforms
tantly now e
right for
the
isions carry,
rkets by inve
company w
S trading plat
roup’s busi
ed a succes
unding CEO
of online lot
al global lot
ents about
hat it is, a s
changing tre
nd other lot
ome 13
year
joys a long t
lthough ther
such an e
h no debt a
ortunities in
e emergenc
egy. The ca
e task.
nt have stuc
ars realistic.
arket value
ewsletter. Th
with the gro
to the finan
njoys both s
long term
he
as evidence
sting small s
ll and deliv
form domin
7
ess
sful
and
ery
ery
2.5
all
nds
ery
s in
rm
e is
ent
d a
the
of
ital
to
We
we
ose
p’s
cial
ale
alth
by
ms
red
tes
-
8/13/2019 Selector March 2013 Quarterly Newsletter
10/19
March 20
Selector ACN 102Level 3, Telepho
the loc
gain ac
key to t
As such
compa
On this
reflecte
IRESS h
manag
a mark
the mo
Our vieWe ap
long te
focus a
2008 in
have c
stream
that cu
4. Com In man
has no
net pro
the bu
allowe
group s
registry
At its
charges
and w
increasi
last fe
positivenjoys
the glo
Our vieWe ha
and a
13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
l market, all
cess to live d
he IRESS bus
IRESS is a m
y delivers.
point, the c
d in the mo
as beaten th
ment group
t opportunit
ey thus far i
w laud the bus
m and their
nd a conserv
very good s
ntinued to i
has allowed
rently repre
utershare ( areas Com
become
th
fits exceedin
iness but hi
the group t
ervices over
managemen
eart, the C
on a per cus
en financial
ng numbers
years have
health of
t
scale, incum
al financial c
w e held a pos
usiness like
tralian Equities
ent Limited 5316 Sydney NSW 22 Web www.se
owing stock
ata feeds w
iness is that
ust have ser
mpany has
st recent an
e incumbent
in the coun
y multiple ti
nvested will
iness ethos t
financial rec
ative approa
ape, despit
vest for to
the group t
ents a 5.0%
PU): share utershare h
e largest
glo
$300 millio
s initial app
act as an a
30,000 glob
t.
mputershar
tomer basis.
markets are
of sharehold
een tough o
he equity
m
ency and an
risis whilst al
itive view on
Computersh
Fund Quarterly
00, Australialectorfund.com
rokers, fun
ile also pro
it is a subscri
vice that will
orked hard
nouncement
s to supply S
ry, with IRE
es larger th
eliver excell
hat underpi
ord stands a
ch is applied
the drop in
orrow, a de
reward exi
ield.
rice $10.10|
s similarities
bal share
re
n. The found
roach to bui
ggregator of
al clients, pr
business i
As such, the
positive, as
ers that req
n companies
arkets. How
annuity typ
so taking ad
global shar
are is not o
Newsletter #33
.au
managers, f
iding all the ption based
live or die b
to develop lo
s from its n
esame Bank
S’s XPLAN fi
an Australia
ent returns o
s IRESS and i
s public reco
sensibly. Th
client dema
t free balan
sting shareh
market capit
to IRESS. A
istry player
er and now c
ld and oper
registry busi
dominately
volves a sca
company be
this invaria
ire the servi
like IRESS an
ver unlike
e income str
antage of ac
markets an
ly a best of
inancial plan
necessary c
odel delive
ased on wh
ng lasting re
west marke
all and Tow
ancial plann
nd provides
ver the ensu
ts managem
rd of what c
e business s
d. More im
e sheet and
lders with a
alisation $5,
business whi
ith revenue
hairman Chri
te a propri
esses both
around fina
lable inform
nefits enorm
ly leads to
ce. It would
d Computers
ther cyclical
am. This ha
quisition opp
d in particul
breed busin
ners and ind
mpliance re
ing time crit
t the client
lationships a
t the United
ry, two of th
ing business
considerable
ing years.
ent team. Th
an be achie
urvived the f
ortantly, wh
a high annui
n attractive
17 million ch had its or
s approachi
s Morris is n
tary softwa
ere and abr
cial markets
ation gather
ously from e
more corpor
come as no
hare, who re
businesses,
s seen the c
ortunities.
r the US for
ss, it also e
ividual client
quirements. ical informat
equires and
nd this has b
Kingdom. H
e largest we
software. Th
confidence
ey think and
ed when vis
inancial crisi
ile managem
ty type earni
dividend str
igins in Austr
g $2
billion
o longer run
re platform
oad. Today,
and specific
ing service
conomic gro
ate activity
urprise that
ly heavily on
Computersmpany weat
some time
njoys wonde
8
s to
The ion.
the
een
ere
alth
is is
hat
act
ion,
s of
ent
ngs
am
alia
and
ing
has
the
ally
hat
th
and
the
the
are
her
ow
rful
-
8/13/2019 Selector March 2013 Quarterly Newsletter
11/19
March 20
Selector ACN 102Level 3, Telepho
earning
capital season
5. Skill
Busine
service
require
speciali
infrastr
expand
CEO un
A serie
resultin
during
equity
current
group.
With a
McMah
financi
impres
A no n
structu
McMah
below
and the
Our vieThis is
attenti
custom
five yea
cash.
efficien
the eco
come.
13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
s leverage
employed th
.
d Engineerins backgroun. A national
ments and s
sts covering
ucture. The
ing nationall
il retiring an
of acquisitio
g in a geari
008 severel
t $1.50 per
CEO Mick M
background
on appears t
lly prepare
ed us but his
nsense app
e and drivi
on’s tenure
70 million, n
recommenc
w a tough busi
n. That sai
er contracts
rs. The busin
cMahon cle
cy, lowering
nomic swing
tralian Equities
ent Limited 5316 Sydney NSW 22 Web www.se
hen conditi
us far and o
g (SKE): shar: The Skille
operator w
killed labour
a wide range
business w
in subsequ
d passing the
ns during th
g ratio of o
tested the
share. CEO
cMahon has
that includ
o have the
it for the
actions to d
oach exemp
g greater
to date. His
et profits are
ement of divi
ness, where
, Skilled do
xtending ou
ess requires
rly underst
cost and kee
, we suggest
Fund Quarterly
00, Australialectorfund.com
ons allow.
ur view rem
e price $3.50
group is Au
ith over 17
needs. As s
of industrie
s founded
ent years. T
baton onto
period 200
ver 50%. Th
usiness and
reg Hargrav
restored mu
s food grou
ecessary skil
ore difficul
te are what
lified by a f
se of tech
success can
set to hit a
dend payme
managing p
minates in
t two years f
little in the
nds what
n
ping debt to
that having
Newsletter #33
.au
anagement
ains that Co
|market capi
tralia’s and
offices, Ski
uch Skilled
s including m
by Frank Ha
e company
son Greg Har
and 2008 s
financial cr
managemen
es resigned i
ch needed fi
p Coles Gro
l sets to not
t times ahe
counts and t
cus on cutti
ology to lif
be seen in t
ew high of o
nts.
ople and m
any segme
or 50% of cli
ay of capital
eds to
be
d
a minimum.
placed the g
has deliver
mputershare
talisation $8
ew Zealand
lled assists
mploys ove
ining, oil an
rgraves in
listed in 199
graves in 200
w company
isis and do
t was forced
n 2010 and
ancial discip
up and priv
only run a la
d. Our me
that end he
ng waste, r
efficiency
e numbers,
ver $50 milli
eting custo
ts of the
nts, with an
and generat
one and
the
While Skilled
oup on a fir
d excellent
is a share t
47 million
s leading pr
clients with
50,000 tra
gas, transp
964, in Me
4, with Harg
3.
net debt blo
nturn that
to restructu
the external
line and busi
te equity fi
rge people b
tings with
has not disa
moving a bl
has been t
with debt l
n, along wit
er needs r
arket and
other 18% st
s significant
importance
will always
er footing, t
returns on
o own for
vider of staf
their workf
e and techn
rt, defence
lbourne, be
raves remai
out to $30
it the econ
e and raise
appointmen
ness rigor to
rm TPG Cap
usiness but
McMahon h
ppointed.
oated corpo
e hallmarks
vels now sit
higher mar
quires const
olds long t
retching bey
amounts of
of driving
m
e susceptibl
he best is ye
9
the
ost
fing
rce
ical
and
ore
ing
0m,
my
ew
t of
the
ital,
lso
ave
ate
of
ing
ins
ant
rm
ond
ree
ore
to
t to
-
8/13/2019 Selector March 2013 Quarterly Newsletter
12/19
March 20
Selector ACN 102Level 3, Telepho
6. Supe
Backgr
the diff
kicked
Super
The rol
and led
market
expect
The ab
survey
with th
over fi
The rol
named
attenti
The gr
accordi
retail c
where
the wa
improv
It might
Over th
the ma
million.
transac
this pu
market
Howev
Manag
tomorr
is too
e
Retail
establis
Even m
conser
receive
13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
r Retail Grouund busineerence betw
off a mail or
heap Auto b
lout model,
to the com
capitalisatio
tions were h
upt departu
d the circu
e appointme
e years and
lout of Supe
Boating, Ca
n.
up underto
ng to plan. It
nditions pos
irtles and hi
they appro
on costs an
sound
simpl
e ensuing ye
rket with th
Accompany
tion. In short
rchase. Desp
s applause. B
r, things are
ment has sh
w. The inter
arly to
deter
roup has co
hed retail b
ore impressi
atively gear
s.
tralian Equities
ent Limited 5316 Sydney NSW 22 Web www.se
p (SUL): shars: The story
een a busine
der automot
usiness that
hich typifie
pany listing
n of $210 m
igh that the
re of respect
stances beh
t of
the
gro
ith strong
Cheap Aut
ping and
k acquisitio
s move into
t the 2008 gl
s team have
ach their tas
d lift margin
e but
many
r
ars, the grou
purchase o
ing the bu
, the compa
ite initial in
irtles is quick
never that si
own an abilit
net’s growin
mine how
w
ntinued to
ands includi
e, they have
d balance s
Fund Quarterly
00, Australialectorfund.com
e price $12.2
of Super Ret
ss that is go
ives busines
eventually e
s most retail
onto the sto
illion and 2
est was yet
ed CEO Tho
ind the mo
p’s CFO
Pet
etail experie
continued
ishing (BCF)
ns to provid
cycling in 2
obal crisis ha
really excell
k. No big ba
by adoptin
etailers fail
t
p continued
Rebel Spor
, the group
ny was askin
estor conce
to point out
mple.
y to deal wit
g penetratio
ell the
grou
eliver year
ng Harvey N
achieved th
eet. On this
Newsletter #33
.au
5|market ca
ail Group ex
d and one t
s from Quee
panded inte
concepts to
ck exchange
0 Super Ch
o come.
rn in 2006 p
e. However,
r Birtles
to
t
nce working
t pace, whil
, that began
e additional
08 has prov
s required a
d. If the Sup
ng sales pitc
better tech
jump
this
i
to lift reven
s from priva
also anno
g shareholde
rns, Birtles a
that what th
h the issues
is both a th
is
placed
to
n year, driv
orman, Mye
se results wi
score alone,
pitalisation $
emplifies wh
hat is great.
nsland. It b
rstate under
day, continu
in 2004. Wi
ap Auto sto
t a tempor
any concer
he top
job.
in the UK, Bi
e the newer
under Tho
scale althou
en a toughe
reater focus
er Retail Gro
h but a lon
ology and d
portant hur
es and mar
te equity fo
nced a larg
rs to trust
nd his team
ey have don
f today whil
reat and an
deal with
t
ing like for l
r and David
th a minimu
the group d
2,389 million
y managem
In 1972 Reg
came the fo
the leadersh
d well into
th a listing
res already
ry lid on thi
s should ha
aving worke
rtles hit the
outdoor ret
n’s watch,
gh not ever
ride while t
on costs. An
up has a key
term consis
elivering on
dle.
ins. In 2011
a total cas
e rights iss
anagement
have justifi
at Rebel is
t investing a
pportunity a
ese issues.
S
ike sales gro
Jones have
of fuss whi
eserves the
nt can ofte
and Hazel R
rerunner to
ip of Bob Th
the new dec
rice of $1.9
up and runn
ngs as inves
ve been alla
d with
Thorn
ground runn
il offering a
as given m
thing has g
he slowdow
d perhaps th
strength, it i
tent strateg
ustomer ne
Birtles surpri
outlay of $
e to fund
on the merit
ably earned
imply sales
nd preparing
nd once aga
o far,
the
Su
wth while m
stumbled ba
lst maintaini
attention it
10
be
we
the
rn.
ade
7, a
ing,
ors
yed
for
ing.
ptly
ore
one
in
is is
s in
to
ds.
sed
610
the
s of
the
01.
for
in it
per
ore
dly.
g a
ow
-
8/13/2019 Selector March 2013 Quarterly Newsletter
13/19
March 20
Selector ACN 102Level 3, Telepho
7. Brevi
Busine
you. Th
provide
with th
Howev
times a
penalty
The Br
home
Interna
Breville
At its c
mass m
the Kit
Cream
its role
Unfort
Breville
the eco
$12.5
coverinsome c
full yea
require
should
ones. T
brands,
Our vieManag
clearly i
group
sheet,
weaken
busines
13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
lle Group: shs Backgroune group’s we
r of small el
e brand wo
r, managem
head. Unde
, dropping th
ville busines
ares. It lis
ional in 200
Group name
re, manage
arket. Produ
hen Wizz Pr
Maker. In ad
as distributo
nately succe
’s distributio
nomics no l
illion in co
g overhead
c
ntext, Brevil
r, so the loss
managemen
’t come as
hese events
a point not l
w ment has d
s at a crossr
ontinues to
arrying net
ing share pr
s. SFM
tralian Equities
ent Limited 5316 Sydney NSW 22 Web www.se
are price $5.
d : If you are
bsite describ
ctrical appli
ld have not
ent’s comm
those circu
e shares fro
s has history,
ed in 1999,
1. The busi
was
restore
ent has set
cts that hav
o Food Proc
dition, the g
of Keurig’s s
ss can often
n margin eff
nger justifie
mission rev
osts, some
le is forecast
of the contr
t to restruct
complete s
however rei
ost on mana
livered exce
ads as it dea
invest and
ash of
$50
ice provides
Fund Quarterly
00, Australialectorfund.com
34|market c
a whiz in t
es itself as “
nces in the
iced the gro
entary at th
mstances it
a high of $
dating back
before it
ess focus s
.
a strategy, t
flowed fro
essor, the Y
oup’s North
ingle serve c
bring its ow
ctively forc
d an ongoin
enue and fo
8 million
is
to generate
ct at the en
re its North
urprise that
force the i
ement.
llent results
ls with the lo
xpand the B
illion and
a
the ideal op
Newsletter #33
.au
pitalisation
e kitchen th
n Australian
consumer pr
up’s stellar
e interim so
didn’t take
.34. So what
to 1957 whe
as acquire
ifted towar
o develop pr
the group’s
uBrew Drip
America op
offee brewin
challenges.
d Breville m
investment.
r the full ye
xpected to
f
$73 million i
of 2013 wil
American op
distribution
portance of
or sharehold
ss of the Keu
reville owne
focus on
de
portunity to
694 million
e name Bre
publicly liste
oducts indus
inancial per
unded a wa
long for the
do we make
n it operate
by anothe
s electrical
emium bran
research an
Coffee Mak
rations hav
g system.
In the case
anagement t
During the
r close to $
lows to
the
n earnings b
l deliver a si
rations. Wh
eals can be
building and
ers over a n
rig distributi
d products.
livering long
re‐examine
ille may me
d company
try.” Even th
ormance ov
rning of pot
market to
of it?
as a small i
r listed gro
appliances a
ed products
d developm
er, and the
benefited e
f Keurig, th
o hand back
half, this bu
20 million is
ottom line.
efore interes
nificant dent
ile this has c
axed, partic
promoting
mber of yea
n deal. In th
With a cons
term sustain
the merits o
n somethin
hich is a lea
ose less fam
er recent ti
entially tou
impose its
porter of b
p, Housew
nd in 2008,
by avoiding
nt area incl
mart Scoop
normously f
decision to
the busines
iness genera
expected. A
To put
that
i
t and tax for
in earnings
me as a blo
ularly succes
ompany ow
rs. The busi
e meantime,
rvative bala
able earning
f this consu
11
to
ing
iliar
es.
her
wn
asic
res
the
the
de,
Ice
om
cut
s as
ted
fter
nto
the
and
, it
sful
ned
ess
the
nce
s, a
er
-
8/13/2019 Selector March 2013 Quarterly Newsletter
14/19
March 20
Selector ACN 102Level 3, Telepho
Govern
It may
BHP Bil
the att
Kloppe
outlinin
next th
to prot
As for
makes
positio
surplus
combin
So rath
big mi
expend
shareh
tomorr
that ou
should
more d
Table 1
Rio TintSales RNet ProEPS USDPS USPayout Net De
BHP BillSales RNet ProEPS USDPS USPayout Net De
Here it
cruisin
May an
13 Selector Aus
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Newsletter #33
.au
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8/13/2019 Selector March 2013 Quarterly Newsletter
15/19
March 20
Selector ACN 102Level 3, Telepho
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Newsletter #33
.au
of Rio, net p
old from US
rising from
illion.
coverage ap
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point of the
debt levels a
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8/13/2019 Selector March 2013 Quarterly Newsletter
16/19
March 20
Selector ACN 102Level 3, Telepho
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13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
doubt follo
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Newsletter #33
.au
but govern
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why help is
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8/13/2019 Selector March 2013 Quarterly Newsletter
17/19
March 20
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interest
things a
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13 Selector Aus
Funds Manage56347 AFSL 220 Bridge Street e 612 8090 361
, that gover
re escalating
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nd economy
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demand. The
to compete
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Newsletter #33
.au
ing somethi
ister Shinzo
central ban
or a weaker
tion have se
ning yen is
ons are high
rd to quanti
s to protect t
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8/13/2019 Selector March 2013 Quarterly Newsletter
18/19
March 20
Selector ACN 102Level 3, Telepho
Compa anuar
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13 Selector Aus
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