Contributors and detractors

The Fund fell 3.5% percent in the month of August.

Top Holdings (alphabetically)

Ciena Corp

United States

Information Technology

Ciena Corporation develops and markets communications network platforms, software, and offers professional services. The Company's broadband access, data and optical networking platforms, software tools, and global network services support worldwide telecom and cable/MSO services providers, and enterprise and government networks.

Eckert & Ziegler Strahlen- und

Germany

Health Care

Eckert & Ziegler AG manufactures equipment for the pharmaceutical industry. The Company produces low-level radiation sources used to treat cancer, heart and other diseases, and in equipment used to calibrate gamma cameras and positron emission computer tomographs. Eckert & Ziegler also develops cancer drugs. The Company markets its products worldwide.

Kornit Digital Ltd

United States

Industrials

Kornit Digital Ltd. manufactures digital inkjet printers. The printers are used by the textile industry to print directly onto cloth. The Company also produces textile inks and other supplies.

Lumentum

United States

Information Technology

Lumentum Holdings Inc. operates as a holding company. The Company, through its subsidiaries, supplies optical and photonic products. Lumentum Holdings serves customers worldwide.

Telix Pharmaceuticals Ltd

Australia

Health Care

Telix Pharmaceuticals Limited operates as a biotechnology company. The Company develops and commercializes molecularly-targeted radiation therapy for the treatment of prostate, renal, and brain cancer. Telix Pharmaceuticals serves patients worldwide.

Strong performance was recorded by US software company Walkme, which rose 27% after quarterly results highlighted plans to reach free cashflow breakeven in 2023. We like the company, it is trading on a low multiple of sales compared to peers and one third of its market cap is in cash, which is far more than it needs to reach breakeven. The company expects to achieve US federal government certification for its products at the end of 2022, which will create significant future opportunities.

Ardent Leisure, owner of the Dreamworld theme parks, rose 19% in the month after selling its US business and returning capital to shareholders. Visits to Dreamworld are running well ahead of 2019 levels despite poor weather and lack of some foreign tourists, which in aggregate account for 20% of revenue, although New Zealand represents the largest portion of this.

US listed fabric and fashion printer company Kornit Digital rose 16% after reporting results that exceeded low expectations following a profit warning in July. The company has 50% of its market cap held in cash, which allowed it to announce a $75mln share buy back. The company will benefit from internet and fashion groups shortening their supply chains.

On the negative side, our healthcare holdings performed poorly following a strong previous month including Photocure -9%, Immutep -16%, Tenant Healthcare -13%, Eckert and Ziegler -8% and Telix -16%.

Australian listed radiation therapy and diagnostic producer Telix was the largest detractor after announcing full year results in which the company reported sales of its newly reimbursed prostate cancer diagnostic Illucix only for the first month of the new financial year, namely July, rather than give any forecasts. We expect sales of the product will continue to ramp strongly over the coming months and look forward to the company’s update for the September quarter late in October. We also expect the approval of the product in Europe by the end of September, and data from the Phase 3 renal cancer diagnostic study and Phase 2 data from the brain cancer therapeutic study provide additional short-term catalysts. Brain cancer has a high unmet need for new therapies given the limited treatment options and poor prognosis which could potentially make this their first therapeutic product to reach the market. We still view Telix’ market value of USD1.2bn as being greatly undervalued compared to its main competitor Lantheus, which has a market cap of USD5.8bn. Although Lantheus had a 7 month head start in the prostate cancer diagnostic market, we believe Telix can close the gap and has a much stronger pipeline of products.