MLT – Milton Corporation | Aussie Stock Forums


One of the issues, which doesn’t necessarily escalate to a worry, for Milton is that can be seen as a dynastic vehicle for certain players. There is nothing inherently wrong with this, as similar inferences can be pointed towards the JB Were “stable”, of AFI, DJW, MIR and Acmil all emerging, over the years and decades from what was an old school ‘Collins St’ investment house. Argo prides itself on stable management and steady hands on the tiller, and is proud of its independence. Milton has links with WHSP and various families that have been involved in managing investments for generations.

A common refrain from what are called the older style of LIC is the conservative management, no or little debt, internal management and low fees. Milton, for example, “maintains a strong balance sheet with no debt and cash on hand to respond to new and existing opportunities identified by our investment team. Milton also has substantial profit reserves and franking credit balances”.

Soul Patts is an “investment conglomerate that has been listed since 1903. Its leadership has consisted of successive family members who value the history of the company. More than 40 employees have worked for the company for over 50 years. Five generations of the Pattinson family have served the company, as have three generations of the Dixson, Spence, Rowe and Letters families“.
Milton has directors aligned with SOL, the Millners for example. Top holding in MLT is SOL, with Brickwoks and New Hope features in the top 20. Now, this isn’t a bad thing in itself if the companies perform; and the Directors would have good insight into that. Going the other way, SOL holds a 3.3% stake in MLT, and an 8.5% holding in the smaller BKI investment (BKI).

At 31 December 2020, Milton holds some 70 companies, and the top 20 (as listed below) account for 72% of the portfolio’s $3.24 billion under management. Note, as well as equities, MLT holds interest bearing securities and real property.

Company ……………… Value $m… % Total Assets …Total Return %
W H Soul Pattinson …….. 276.1 …… 8.5 …… 55.9%
Commonwealth Bank …. 257.9 ….. 8.0 ……. 19.7%
Macquarie Bank Ltd …… 225.2 …… 6.9 …… 17.9%
BHP Group Limited ……. 206.0 …… 6.4 …… 20.6 %
Westpac Banking Corp…193.4 …… 6.0 ……… 9.6%
CSL Limited ……………….. 170.2 …… 5.3 ……. (0.8)%
Wesfarmers Limited ……145.0 …… 4.5 ……. 14.5%
Woolworths Limited …..115.5 ……. 3.6 ……… 6.7%
National Aust. Bank …..110.0 ……. 3.4 ……. 25.7%
A P Eagers Limited …….. 90.3 ……. 2.8 ……. 96.9%
Transurban Group …….. 79.4 …… 2.5 ……. (2.3)%
Rio Tinto Limited ……….. 76.2 …… 2.4 ……. 18.4%
Brickworks Ltd …………… 62.1 …… 1.9 ……. 23.8%
ALS Limited ……………….. 58.4 …… 1.8 ……. 47.8%
Coles Group Ltd ………… 52.2 …… 1.6 ……… 7.3%
Telstra Corporation …… 45.4 …… 1.4 ……. (2.2)%
Amcor Limited …………… 44.2 …… 1.4 …….. 6.8%
Perpetual Limited ……… 42.8 …… 1.3 ……. 18.8%
AGL Energy Limited …… 42.7 …… 1.3 …… (26.9)%
ASX Limited ……………….. 39.5 …… 1.2 …… (14.2)%

I wouldn’t angst too much over MLT versus ARG, or AFI for that matter. Their mandates are similar. Perhaps a point of differentiation would be to also look at small to mid cap LICs as a complement to the blue chips. Fund size may be smaller, and fees higher, but smallness can equate to nimbleness.



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