Flagship Investments Limited (ASX: FSI)
Preserving Confidence, Producing Results.
Flagship Investments Limited (FSI) is an investment company providing investors with access to an expertly crafted quality portfolio of Australian growth companies managed by EC Pohl & Co Pty Ltd. EC Pohl & Co has a strong funds management investment team renowned for its stability, track record and sound investment process. EC Pohl & Co is paid a management fee based on performance and not a fixed percentage of the funds under management, ensuring the manager is focused on absolute returns to Shareholders.
EC Pohl’s investment strategy centres on the view that investing in high-quality business franchises with the ability to grow sales and earnings at rates above GDP will produce superior investment returns over the long term. The portfolio of investments comprises investments in well-managed companies whose operations cover a wide spectrum of business activities and is constructed from the perspective of a business owner and not simply by tracking the index weighting of various index component stocks. The resultant portfolio performance is monitored by FSI’s Board of Directors.
Mission
Creating Shareholder wealth through active management of a portfolio of ASX listed quality growth companies.
Objectives
The investment objectives of Flagship Investments Limited are:
- To achieve medium to long-term capital growth and income through investing in a diversified portfolio of Australian companies;
- To preserve and enhance the NTA backing per share; and
- To provide Company Shareholders with a fully franked dividend, which over time, will grow at a rate in excess of the rate of inflation.
The benefits for investors include:
- Reduced share investment risk through a diversified investment portfolio;
- Professional, disciplined management of an investment portfolio;
- Access to available tax advantages of Listed Investment Company Capital Gains when available;
- Convenient and simple administration of your investment as your single holding in FSI gives you access to a multitude of stocks;
- Anticipated continued growth in fully franked dividend income;
- Access to a Dividend Reinvestment Plan;
- No fixed management fees – the Investment Manager is only remunerated on a performance basis;
- No entry or exit fee charged by FSI; and
- Easy access to information via FSI’s registered office or web site or the Australian Securities Exchange.
It is FSI's current policy to manage the portfolio within the following guidelines:
- Exposure to a minimum of 20 different companies to give the portfolio adequate diversification.
- The majority of shareholdings to be invested in companies that have a market value of at least $10 million; and
- FSI will aim to maintain more than 90 per cent of available funds in equity investments at all times. The remaining funds will be held in bank bills, similar cash securities and on deposit in the short term money market.
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EC Pohl & Co’s investment philosophy is to invest in high quality, capital light, growth companies identified by an investment process which filters out non-compliant companies. The Investment process filters for investment grade companies using the following metrics:
The first requirement ensures that a company is growing. Only those companies with sales that have been growing faster than the Australian economy (as measured by Nominal Gross Domestic Product) are accepted. The principle here is that we don’t want to own businesses that are stagnant or shrinking.
The second requirement, return on equity is our litmus test for business model success. Only companies showing an annual return on equity of 15% or greater are considered. To put this another way, if an investor can get a return of 5% on government bonds that are relatively risk free, we believe that 15% is the minimum that an investor in a company should receive for the extra risk of owning equity. This represents an equity premium of 10%.
The third requirement ensures balance sheet strength and business resilience through economic cycles. Only those companies whose operation cash flow covers their annual interest bill on their borrowings by four times or greater are considered. That is, company cash flows have to drop by more than 75% before they are going to have trouble servicing their debt.
When these three filters are applied together to all the Australian listed companies, we are left with 80 to 100 companies to consider for investment. The common traits these companies share are that they are growth orientated with a strong business franchise, and in particular, those that we believe have a sustainable competitive advantage. |
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FSI commenced operations in April 1998 and listed in December 2000 on the Australian Securities Exchange as Wilson Investments Taurine Fund Limited (ASX code: WIT). In October 2012 Shareholders decided to change the name of the Company to Flagship Investments Limited after EC Pohl & Co took over the management of the investment portfolio. While FSI is a separate company it is an integral and important part of the overall distribution strategy of EC Pohl & Co and is the retail product offering of the EC Pohl & Co Australian Broad Cap investment strategy.
The EC Pohl & Co group of companies have indicated that they intend to retain at least a 30% interest in FSI at all times thereby ensuring a long-term association with the group.
Investment Manager
The management of the Company’s investment portfolio is undertaken by EC Pohl & Co Pty Ltd. EC Pohl & Co is a specialist equities fund manager with over twenty years managing the Flagship Investments’ portfolio. Together with its subsidiary ECP Asset Management Pty Ltd, the group manages equity portfolios on behalf of sophisticated investors, listed and unlisted funds and institutional clients.
As at 30 June 2023 the group had $2.4 billion in funds under management.
The Company's portfolio of investments comprises companies with a sustainable competitive advantage whose operations cover a wide spectrum of business activities. The portfolio is constructed from the perspective of a business owner, by investing in well managed companies and not simply by tracking the index weighting of various component stocks.
Dr Manny Pohl AM is the Managing Director and major Shareholder of EC Pohl & Co Pty Ltd. Information on the Investment Manager is available from: www.ecpohl.com & www.ecpam.com
Appointed Non-Executive Director on 8 October 2009, and Non-Executive Chairman on 7 November 2016. Extensive experience as a Partner with McCullough Robertson Lawyers and a Solicitor with the Supreme Court of Queensland.
Other current Directorships:
- Director of TRI Foundation Limited
- Director of Ian Frazer Family Foundation Pty Ltd
- Co-Chair of the Curamba Institute – QUT
- Chair of Climate-KIC Australia Ltd
- Member of QUT Council
Qualifications: Solicitor of the Supreme Court of Queensland, LLB (QUT), LLM (Sydney University), LLM (Bond University)
Managing Director since the inception of the Company in 1997. Extensive experience in the funds management industry.
Other current Directorships:
- Managing Director of Global Masters Fund Limited
- Managing Director of Athelney Trust PLC
- Chairman of EC Pohl & Co Pty Ltd
- Director of Bond University Limited
- Director of Huysamer International Holdings (Pty) Ltd
Qualifications: Pr Eng, B.Sc (Eng), MBA, DBA, FAICD, MSAFAA, F Fin
Appointed Director on 29 September 2021. Extensive experience in management consulting in the UK, South Africa, Ireland and Germany. Accredited commercial mediator, negotiation expert and corporate crisis leader.
Other current Directorships:
- Director of Congrua Limited
- Director of Global Masters Fund Limited
- Board Member of Freedom Solutions
Qualifications: B.Compt, MBA, GAICD
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The issuer of the securities is identified at the top of this page. The prospectus and, where applicable, target market determination for the product are available in the Documents section of this listing. Prospective investors should consider the Prospectus before deciding to acquire the securities and applications for securities must be made by completing the application form provided with the Prospectus. This product listing was vetted by and approved by the issuer identified above before publishing. Investment Markets (Aust) Pty Ltd AFSL 527875 (IM) is not the issuer of the securities.
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