The Maple-Brown Abbott Global Listed Infrastructure Fund is an actively managed, high conviction fund that invests in global listed infrastructure equities with a focus on regulated, contracted and concession assets or networks that provide essential services. We believe that the benefits of investing in infrastructure overall is its ability to provide higher yield, inflation protection and portfolio diversification benefits to investors. Our Fund seeks to capture these attractive features but at a lower level of risk.
The Fund currently holds 29 global infrastructure stocks and returned -4.6% for September which was below the reference index. Calendar year to date the Fund has returned 1.7%, which compares to a return of -3.1% by the reference index. Global equities have been much stronger year to date, with the MSCI World in AUD up 16.7%.
The main positive stock attribution versus the reference index for the month came from a stock that isn’t held by the Fund, US clean energy and regulated utility Nextera Energy (NEE), which was down 14% for the month. NEE is the largest reference index constituent at approximately 4.5% and it was dragged down by news at its separately listed ‘YieldCo’ Nextera Energy Partners LP (NEP). NEP is a limited partnership that was formed to acquire and manage some of NEE’s clean energy projects. We have been suspicious of the governance structure of NEP for some time, hence we do not own NEP either. NEP announced it was halving its distribution growth as it was unsustainable in the higher interest rate environment.
Negative to Fund attribution were holdings in cell towers such as Cellnex which was down 7% and renewable energy companies such as Energias de Portugal (EDP) which was down 6%.
What is Maple-Brown Abbott Global Listed Infras Maple-Brown Abbott Global Listed Infras is an Managed Funds investment product that is benchmarked against Global Infrastructure Index and sits inside the Property - Global Listed Infrastructure Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The Maple-Brown Abbott Global Listed Infras has Assets Under Management of 1.46 BN with a management fee of 0.98%, a performance fee of 0.00% and a buy/sell spread fee of 0.4%.
How has the investment product performed recently?
The recent investment performance of the investment product shows that the Maple-Brown Abbott Global Listed Infras has returned 1.57% in the last month. The previous three years have returned 10.94% annualised and 10.76% each year since inception, which is when the Maple-Brown Abbott Global Listed Infras first started.
How is risk measured in this investment product?
There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since Maple-Brown Abbott Global Listed Infras first started, the Sharpe ratio is NA with an annualised volatility of 10.76%. The maximum drawdown of the investment product in the last 12 months is -3.15% and -21.03% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
What is the relative performance of the investment product?
Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The Maple-Brown Abbott Global Listed Infras has a 12-month excess return when compared to the Property - Global Listed Infrastructure Index of -0.08% and 1.65% since inception.
Does the investment product produce Alpha over its Peers?
Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. Maple-Brown Abbott Global Listed Infras has produced Alpha over the Property - Global Listed Infrastructure Index of NA% in the last 12 months and NA% since inception.
What are similar investment products?
For a full list of investment products in the Property - Global Listed Infrastructure Index category, you can click here for the Peer Investment Report.
What level of diversification will Maple-Brown Abbott Global Listed Infras provide?
Maple-Brown Abbott Global Listed Infras has a correlation coefficient of 0.85 and a beta of 1.08 when compared to the Property - Global Listed Infrastructure Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.
How do I compare the investment product with its peers?
For a full quantitative report on Maple-Brown Abbott Global Listed Infras and its peer investments, you can click here for the Peer Investment Report.
How do I compare the Maple-Brown Abbott Global Listed Infras with the Global Infrastructure Index?
For a full quantitative report on Maple-Brown Abbott Global Listed Infras compared to the Global Infrastructure Index, you can click here.
Can I sort and compare the Maple-Brown Abbott Global Listed Infras to do my own analysis?
To sort and compare the Maple-Brown Abbott Global Listed Infras financial metrics, please refer to the table above.
Has the Maple-Brown Abbott Global Listed Infras been independently verified by SMSF Mate?
This investment product is in the process of being independently verified by SMSF Mate. Once we have verified the investment product, you will be able to find more information here.
How can I invest in Maple-Brown Abbott Global Listed Infras?
How do I get in contact with the Maple-Brown Abbott Global Listed Infras?
Comments from SMSF Mates
SMSF Mate does not receive commissions or kickbacks from the Maple-Brown Abbott Global Listed Infras. All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - August 31, 2023 The Fund currently holds 30 global infrastructure stocks and returned -1.5% for August which was broadly in line with the reference index. Year to date the Fund has returned 6.6%, which compares to a return of 1.3% by the reference index. Global equities have been much stronger year to date, with the MSCI World in AUD up 21.6%.
Most of our listed infrastructure holdings were weaker over August as US long rates climbed higher. Mexican toll road holding Aleatica was the best performer as it neared takeover and delisting by IFM. Long cashflow duration stock underweights Transurban and Nextera Energy were the next largest adders versus the reference index (their shares were both off ~8%). Our transportation infrastructure holdings continued to report traffic recoveries post COVID. For example, Ferrovial’s largest toll road asset, the Toronto Highway 407, managed to get back to pre-COVID traffic in the month of June. Meanwhile Zurich Airport reported a better than expected first half result and said that passengers in the first half were at 88% of the level in 2019.
One of the smallest Fund positions offshore wind developer and operator Orsted was particularly weak, down 25% in local currency terms which is an unusually large move for a listed infrastructure stock. Orsted announced impairments to their US offshore wind portfolio. Supply chain impacts, outlook for tax credits and higher US interest rates all conspired to reduce future US project returns.
Performance Commentary - July 31, 2023 The Fund currently holds 32 global infrastructure stocks and returned 0.8% for July which was broadly in line with the reference index. Year to date the Fund has returned 8.3%, which compares to a return of 2.9% by the reference index. Global equities have been much stronger year to date, with the MSCI World in AUD up 19.7%.
Brazilian toll road holding Ecorodovias was the strongest performer over July (up 26%). Revenue and cashflows were reported ahead of expectations for the first half of the year. Total like-for-like traffic in the first half was 8% above the pre-COVID 2019 level and tolls saw strong inflation-driven increases.
European transport concessions Ferrovial and Getlink continued their strong start to the year (up 5% and 3% respectively for July). Some of our large US regulated utility holdings started to perform after a weak start to the year, with Ameren, Entergy and Duke Energy returning between 4 and 6%.
There was ongoing weakness in US cell-tower companies and our main holding in that sector, Crown Castle, was down 5.0% making it our weakest holding for the month. We are seeing attractively priced opportunities in the US cell-tower sector after a weak 18 month period. The towers have been weak due to concerns over rate increases, leverage and their growth outlook. We see these factors as being more than priced in currently with their strong business models, defensive contracted earnings and long-term growth as digitalisation continues.
Performance Commentary - June 30, 2023 The Fund currently holds 30 global infrastructure stocks and returned -0.9% for June, underperforming the reference index by 0.9%. This completed the quarter with a return of -0.1% for the Fund, which compares to a return of 0.3% for the reference index.
It has been a particularly strong start to 2023 for global equities. In AUD terms the MSCI World index is up 17.2% for the first half of the year. This compares to the Fund returning 7.5% and the listed infrastructure reference index returning 2.1%. Global equities have been propelled by a large rally in US tech stocks. Indeed, the first half of 2023 was the worst first half for US utilities (many of which are in the infrastructure universe) versus the broader US equity market, since the 1990s. US utilities have been relatively weak yearto-date due to the market having interest rate concerns (even though the ten year bond yield has barely changed) and a stronger US economy than many predicted at the start of the year.
There was a mixed bag of relatively good performers in the Fund over June. Orsted, Cheniere Energy and Flughafen Zurich all did well (up 6-9%). Meanwhile Getlink, Cellnex and Severn Trent were the largest detractors (down 2-5%). During the month, except for the UK water sector (discussed below), news flow was relatively limited.
The Fund has nearly 6% invested in UK water utilities and towards the end of the month the privately owned and largest UK water utility Thames Water (not held) ran into financial difficulty. The problems at Thames Water have been brewing for years through a combination of high gearing and poor operational performance. This is in contrast to our listed holdings in Severn Trent and United Utilities. For example, our holdings are geared at around 60% of their regulated asset base (RCV) compared to ~80% at Thames Water. The regulator OFWAT assumes gearing at 60% and a rising interest rate environment can potentially expose more highly leveraged companies depending on the make-up of their debt profile. Severn Trent and United Utilities have a four-star environmental rating from the EPA and they have been able to earn positive financial incentives for good operating performance over recent years. This is in contrast to Thames Water which has a twostar rating and has suffered financial penalties for operational performance. Our view is that the situation at Thames Water is a crisis of the private equity infrastructure ownership model rather than a wider UK water sector issue. In addition, we have observed over recent years that the prices being paid in private transactions globally have been at a material premium to where comparable infrastructure assets trade in listed markets.
Performance Commentary - May 31, 2023 The Fund currently holds 30 global infrastructure stocks and returned -4.5% for May, underperforming the reference index by 1.4%. Global listed infrastructure stocks were generally weaker over the month. Regulated US utilities continued their relative weakness year to date, with holdings in Ameren and American Electric Power down 9-10%. Likewise US cell-tower stocks continued their recent weakness.
The UK makes up 13% of the Fund and the four holdings all reported full-year results (March year-end) over May. Scottish energy and networks company SSE PLC was the most impressive with earnings and capex upgrades unveiled. The flexibility of thermal generation is currently very profitable in a volatile UK power market.
Fresh capex includes increased investment in the electric networks and renewables space. Results for the UK water holdings met expectations and we think they are well placed for the upcoming five year regulatory pricing review that will mostly take place over this year and next. The potential for increasing environmental spend is a feature that we are watching closely. Inflation remains higher than expected in the UK and the holdings generally have strong inflation protection embedded in their regulatory frameworks.
Performance Commentary - April 30, 2023 The Fund currently holds 30 global infrastructure stocks and pleasingly returned 5.5% for April, outperforming the reference index by 2.0%. Our European infrastructure holdings continued to perform well and this has been a solid theme so far in 2023. Owner and operator of the UK-France Channel Tunnel concession Getlink delivered a strong Q1 result, with broad-based strength across its business including a stronger-than-expected rebound in Eurostar passenger volumes.
Even though volumes are still recovering post-COVID, car and truck shuttle pricing has also continued to deliver and was ahead of expectations amidst high inflation. Finally, its newly-constructed ElecLink transmission cable linking the French and UK power grids through the tunnel has continued to perform well and has already begun contracting 2024 capacity. Getlink is a >5% position in the Fund and was up 12% for April.
Despite the French political protests, we also saw further strength in French concession (toll roads and airports) and construction company Vinci, which was up 9% for April. European cell-tower holdings Cellnex and INWIT continued to perform well, in contrast to our US cell-tower company Crown Castle which was down 8% for April after reporting a lacklustre Q1 result, but maintained guidance for the full year.
Performance Commentary - February 28, 2023 The Fund currently holds 30 global infrastructure stocks and pleasingly returned 1.2% for February, outperforming the reference index by 1.7%. Our European infrastructure holdings continued to perform well over February. The best stock from an attribution point of view was Vopak which reported a solid 2022 financial result and continued its good share price run up 9% for the month. Vopak issued earnings guidance for 2023 above sell-side consensus driven by improved market conditions for its tank storage infrastructure assets and it is also benefitting from inflation tailwinds feeding into higher contracted storage rates in 2023 and beyond.
European concession holdings such as French transportation infrastructure and construction company Vinci and Channel Tunnel operator Getlink also performed relatively well. Vinci reported another set of strong results for 2022 that beat market expectations. The stock finished up 4% for the month. US regulated utilities were generally weak and likewise the cell tower companies particularly in the US were weak as US 10 year bond yields increased over the month.
Performance Commentary - January 31, 2023 The Fund currently holds 30 global infrastructure stocks and pleasingly returned 1.3% for January, outperforming the reference index by 2.6%. Our European infrastructure holdings were generally stronger over January, especially the transportation concessions such as Vinci (up 11%) and Ferrovial (up 10%). European cell tower company Cellnex was up 16% in local currency, reflecting strength in the tower sector and also media reports about a potential takeover by American Tower and Brookfield Asset Management. We built around a 5% position in Cellnex over 2022 as it was particularly weak over interest rate concerns. US utilities were modestly weaker relative to the listed infrastructure sector, even with the decline in bond yields. This was due to the US equity market moving money into general US equities to capture the market’s ‘risk-on’ mood. Our large regulated utility holdings such as Ameren and American Electric Power were down 2% and 1% respectively. Likewise US utilities that we don’t hold were down a similar amount, with the exception of large-cap Nextera Energy (not held) which was down 11% following a mixed 2022 financial result, management turnover and an alleged political financing investigation.
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