Exelity månadsrapport – december 2023

Exelity Monthly Report – December 2023

Exelity finishes the year strong with a net return (after fees) of +6.5% for December, taking the fund up 27% for the full year 2023. Exelity's strategy has been vindicated over the year, with market declines pared well with only two negative return months during the year (- 1.6% and -0.5%).

I also want to take the opportunity to introduce myself, Marlon Värnik, where I took over the management of Exelity after the summer. With my background as a stock analyst for almost seven years, I place great focus on data-driven and deep fundamental analysis. Alpha generation is core, where great emphasis is placed on underlyingly tracking the development of the company in the form of data points, company meetings, site visits, but also meeting key people among competitors, suppliers and developed contacts with sector insight. This is one of several factors why performance has been especially strong in the second half of 2024, where Exelity is +18% since the summer, despite an equity exposure of only about 44% on average of AUM.

Just like November (+8.2%), December's development was driven by the fund's listed holdings, where the equity portfolio was listed up 10.2% for the month. The share exposure as a share of the total portfolio amounted to 49%. The strongest contributors to the listed portfolio during the month were Smart Eye and Vestum. However, the increase was broad among the portfolio companies, where the fund's three largest holdings (Smart Eye, CTT and Fortnox) now represent approx. 19% of NAV.

The guarantee and loan portfolio continues to show solid underlying returns, contributing 1.9% to Exelity's return for the month. We continue to outperform the index, where for example the OMX Small Cap PI closed +5% for December and -6.5% for the full year 2023. However, we would like to remind again that there is no relevant benchmark that matches Exelity's unique profile. Our goal is instead to deliver at least 10 % net returns per year, which we have exceeded by 17 percentage points in 2023.

Our upcoming loan income for the next twelve months corresponds to approx. 6 % of the fund's current asset mass (NAV), which forms a good basis for future stable returns. Our loan stock as of the end of November amounts to 43% of NAV, a level we are comfortable with and which is expected to remain around this in the near term. Given our loan limit of max 50% of NAV against loans, we see limited room to increase the loan portfolio going forward. During December, we signed six new guarantees, where the guarantee portfolio now corresponds to 15% of NAV.

With a well-diversified share portfolio, stable loan stock and high activity on the guarantee side, we look forward to 2024 with excitement!

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