At the outset let me acknowledge that these quality defensive growth companies won’t necessarily appeal to the value-oriented investors of Stockopedia, and secondly that I’m talking my own book. But I’ve long been bearish on UK plc and have been positioned for some years for the kind of dramatic underperformance against comparator economies that was heralded by the Bank of England this week. The first expression of this view is that approximately 80% of my portfolio is distributed across the US, Europe and Japan. And while I do hold a very small number of UK-focused companies in structural growth areas like government IT, over 90% of my UK names are internationally focused. This largely without exposure to the multinational but cyclical giants of the FTSE 100.
For the benefit of anyone with a GBP-only investment horizon, who might be trawling for ideas for less cyclical companies with only marginal UK revenues, here is a download from my portfolio. To be clear, these holdings have underperformed at least as poorly as the rest of the small to mid-cap universe in ‘22 - there are no grounds to applaud my grim performance. But for those seeking beaten-down small to mid-caps whose operating performance might turn up and out of the downturn sooner than UK-focused cyclicals, there might be some ideas here.
What is instructive, I believe, is to review how the latest earnings reports from these names have been received - most have held their ground well on updating recently, with the disappointing exception of XPP.
Equally, if anyone sees outsized risks in any of the names listed below, then I am all ears as to your thoughts. The percentage relates to the proportion of revenues exposed to UK customers.
Alpha FX 30%
Alphawave IP 0%
Ashtead 12%
AstraZeneca 9%
Aveva Group 3%
Bango 5%
Beeks Financial Cloud 27%
Calnex <30%
Cambridge Cognition 9%
CentralNic 2%
Cerillion unknown (70% Europe incl UK)
Churchill China 40%
D4T4 16%
Diaceutics 4%
Diageo 10%
Diploma 18%
Ergomed 12%
Experian 13%
Games Workshop 20%
GB Group 34%
Halma 18%
Hikma Pharma 0%
Instem Life Science Systems 8%
Judges Scientific 16%
Keywords Studios 18%
Kin & Carta 40%
London Stock Exchange 31%
Network International Holdings 0%
RELX 17%
SDI Group 44%
Smurfit Kappa 9%
Somero ~1%
Spirax Sarco 7%
SThree 15%
Treatt 8%
Volex 17%
Water Intelligence 0%
XP Power 12%
YouGov 28%
