The fund rose 6.72% during the first quarter of 2019. Returns were driven by strong performances from Kip McGrath (ASX:KME), Rhipe (ASX:RHP), Temple and Webster (ASX:TPW) and City Chic (ASX:CCX). All of these companies reported strong 31 December half year results in February and their share-price has continued that momentum in March.
City Chic, a retailer of womenswear in Australia, has recently indicated they are maintaining like-for-like growth in a tough retail environment and investors are excited with the new management team. Temple and Webster, an online retailer of homewares and furniture, is also defying the poor market conditions evidenced by very strong revenue growth of 40% and we expect these trends to continue.
The detractors this quarter have been smaller positions including Empired (ASX:EPD) and Konekt (ASX:KKT), both of which are suffering from uncertainty around contract renewals. We believe their share prices are skewed towards substantial upside if contracts are retained and minimal downside if they are lost.
