Liontrust GF European Smaller Companies

The Fund’s A3 share class returned -1.6%* in euro terms in August. This Fund’s target benchmark, the MSCI Europe Small Cap Index, returned -0.3%.

European markets experienced considerable volatility in August, driven by global economic challenges and interest rate expectations. At the start of the month, a sharp sell-off was triggered by disappointing U.S. employment data and an unexpected rate hike from the Bank of Japan. These factors led to a significant drop in global equities, including Europe, before markets recovered later in the month as investors started pricing in potential rate cuts by central banks. Real estate (+4.2%), healthcare (+4.1%) and communication services (+3.4%) were among the strongest performing sectors in the wider MSCI Europe index, while energy (-3.1%) and information technology (-1.4%) were the only two sectors to post a negative return over the month.

Danish jewellery manufacturer and retailer Pandora (+9.3%) posted strong organic growth in Q2, while also lifting its revenue guidance for the full-year. The company reported consensus-topping Q2 revenues of DKK 6.77 billion, with organic revenue growth of 15% slightly surpassing expectations. Following a solid quarter, Pandora upgraded its FY24 revenue guidance to 9-12% organic growth from the previous 8-10%, reflecting strong momentum.

Norwegian home textile and interior retailer Kid (+17%) performed strongly on the announcement of robust Q2 results, in which it reported revenues of NOK 797.8 million, an increase of 10.2%, with strong contributions from both Kid Interior and Hemtex segments.

Shares in gambling software company Playtech (+15%) rose after reports that it was in talks with Flutter Entertainment Plc on the potential sale of its Italian unit, Snaitech, for about £2 billion.

4imprint (-13%), the supplier of promotional merchandise, saw its shares fall after analysts noted a drop in the amount of revenue it makes from each marketing dollar due to weaker economic conditions. Despite this, 4imprint managed to grow revenue by 5% between January and June, and operating profit rose by 10% to $69.9 million. Orders from new customers totalled 250,000, 8% below 2023 levels, but demand from existing customers continued to climb and the average value of orders also rose by 2%.

Shares in materials technology company Vesuvius (-17%) weakened after it warned that the recovery in its end market is only likely to materialise next year. The company announced that revenue in the first half of 2024 fell 5.9% to £937 million from £995 million a year prior, noting particular weakness in its Foundry segment.

Positive contributors to performance included:

KID ASA (+17%), PlayTech (+15%), Pandora (+9.3%),

Negative contributors to performance included:

4imprint (-13%), Vesuvius (-17%), Ringkjoebing Landbobank (-9.5%)

Discrete years' performance (%) to previous quarter-end:

*Source: Financial Express, as at 31.08.24, total return (net of fees and income reinvested).

**Source: Financial Express, as at 30.06.24, total return (net of fees and income reinvested). Discrete data is not available for ten full 12-month periods due to the launch date of the portfolio (01.02.17). Investment decisions should not be based on short-term performance.

KEY RISKS

Past performance is not a guide to future performance. The value of an investment and the income generated from it can fall as well as rise and is not guaranteed. You may get back less than you originally invested.

The issue of units/shares in Liontrust Funds may be subject to an initial charge, which will have an impact on the realisable value of the investment, particularly in the short term. Investments should always be considered as long term.

Overseas investments may carry a higher currency risk. They are valued by reference to their local currency which may move up or down when compared to the currency of the Fund. This Fund may have a concentrated portfolio, i.e. hold a limited number of investments. If one of these investments falls in value this can have a greater impact on the Fund's value than if it held a larger number of investments. As the Fund is primarily exposed to smaller companies there may be liquidity constraints from time to time, i.e. in certain circumstances, the fund may not be able to sell a position for full value or at all in the short term. This may affect performance and could cause the fund to defer or suspend redemptions of its shares. In addition the spread between the price you buy and sell units will reflect the less liquid nature of the underlying holdings. Outside of normal conditions, the Fund may hold higher levels of cash which may be deposited with several credit counterparties (e.g. international banks). A credit risk arises should one or more of these counterparties be unable to return the deposited cash. Counterparty Risk: any derivative contract, including FX hedging, may be at risk if the counterparty fails.

DISCLAIMER

This is a marketing communication. Before making an investment, you should read the relevant Prospectus and the Key Investor Information Document (KIID), which provide full product details including investment charges and risks. These documents can be obtained, free of charge, from www.liontrust.co.uk or direct from Liontrust. Always research your own investments. If you are not a professional investor please consult a regulated financial adviser regarding the suitability of such an investment for you and your personal circumstances.

This should not be construed as advice for investment in any product or security mentioned, an offer to buy or sell units/shares of Funds mentioned, or a solicitation to purchase securities in any company or investment product. Examples of stocks are provided for general information only to demonstrate our investment philosophy. The investment being promoted is for units in a fund, not directly in the underlying assets. It contains information and analysis that is believed to be accurate at the time of publication, but is subject to change without notice. Whilst care has been taken in compiling the content of this document, no representation or warranty, express or implied, is made by Liontrust as to its accuracy or completeness, including for external sources (which may have been used) which have not been verified. It should not be copied, forwarded, reproduced, divulged or otherwise distributed in any form whether by way of fax, email, oral or otherwise, in whole or in part without the express and prior written consent of Liontrust.