- International markets rose in Q4 driven by strong performance in Developed Markets offsetting weakness in Emerging Markets.
- The SGA International portfolio trailed its benchmark modestly in Q4 but outperformed in 2021 despite headwinds from a more cyclical market environment.
- Turnover was below-average in Q4 with a new position in Indian payments and financial services company PayTM initiated while no positions were sold. Several positions were added to on weakness and trimmed on strength.
- The portfolio is forecasted to deliver 13% revenue growth and 18% earnings growth over the next three years, much higher than the broad markets, with greater predictability and stronger quality characteristics.
- Co-founder, Portfolio Manager and Analyst Gordon Marchand has announced that he will retire from the firm at the end of Q2 2023 as he turns 68 years old. Gordon will relinquish his portfolio management responsibilities to Kishore Rao who will join Alexandra Lee and Tucker Brown on the International Portfolio Management Team on July 1, 2022. Further details regarding the change are provided at the end of this commentary.
The opinions expressed herein reflect the opinions of Sustainable Growth Advisers, LP and are subject to change without notice. Past performance is no guarantee for future results. This information is supplemental and complements a GIPS Report that can be found with composite performance. The securities referenced in the article are not a solicitation or recommendation to buy, sell or hold securities. This commentary is provided only for qualified and sophisticated institutional investors.
Results are presented gross and net of management fees and include the reinvestment of all income. The Net Returns are calculated based upon the highest published fees. The net performance has been reduced by the amount of the highest published fee that may be charged to SGA clients, 0.85%, employing the International Growth equity strategy during the period under consideration. Actual fees charged to clients may vary depending on, among other things, the applicable fees schedule and portfolio size. SGA’s fees are available upon request and also may be found in Part 2A of its Form ADV. Policies for valuing investments, calculating performance, and preparing GIPS Reports are available upon request. Upon request, free of charge, SGA can provide a list of all portfolio holdings held in SGA’s International portfolio for the past twelve months. Past performance is not indicative of future results. SGA’s earnings growth forecast data is based upon portfolio companies’ Non-GAAP operating earnings.