In December the fund performed in line with its benchmark index (+9.03% vs. +8.94%). After central banks indicated that interest rates might come down faster than expected, small caps began to perk up towards the end of the year. The good news:
• VIRBAC (5% of AUM) raised its forecast for the end of the year and provided guidance for 2024 that is significantly higher than market expectations.
• FOUNTAINE PAJOT (5% of AUM) announced +30% growth of operating results in 2023, a remarkable performance which is much better than its competitors’. Even after a slight rebound, the share valuation remains very low.
By contrast, FOCUS HOME (1.8% of AUM) published disappointing earnings, and LUMIBIRD (1% of AUM) announced a profit warning due mainly to delays in several orders. We opened a new position in AUBAY, whose shares experienced a turbulent 2023. The valuation is attractive again and the company’s balance sheet is solid, with €90 million (net) in cash.