For personal use only
MMJ Group Holdings Limited
Suite 5706, Level 57, MLC Centre
19-29 Martin Place
Sydney NSW Australia 2000
www.mmjgh.com.au
info@mmjgh.com.au
ASX RELEASE
11 November 2021
MMJ Investment Portfolio Report as at 31 October 2021
MMJ Group Holdings Limited (ASX: MMJ) ("MMJ is an Australian-listed specialist investment company which concentrates on producing capital growth for shareholders over the medium to long term from investments in listed and unlisted equities and other financial assets.
MMJ Investment Portfolio Report as at 31 October 2021
MMJ is pleased to provide the MMJ Investment Portfolio Report as at 31 October 2021 which includes the disclosure pursuant to Listing Rule 4.12.
- - - - - - - - - -
Investor and Media Enquiries
Announcement authorised for release to ASX by:
Jim Hallam
Chief Financial Officer and Company Secretary
E: Compsec@mmjgh.com.au
For personal use only
About MMJ
MMJ Group Holdings Limited (ASX:MMJ) ("MMJ") (ABN 91 601 236 417 is an Australian-listed specialist investment company which concentrates on producing capital growth for shareholders over the medium to long term from investments in listed and unlisted equities and other financial assets.
Important Notice
This announcement contains reference to certain intentions, expectations, future plans, strategy and prospects of MMJ. Those intentions, expectations, future plans, strategy and prospects may or may not be achieved. They are based on certain assumptions, which may not be met or on which views may differ and may be affected by known and unknown risks. The performance and operations of MMJ may be influenced by a number of factors, many of which are outside the control of MMJ. No representation or warranty, express or implied, is made by MMJ, or any of its directors, officers, employees, advisers or agents that any intentions, expectations or plans will be achieved either totally or partially or that any particular rate of return will be achieved. Given the risks and uncertainties that may cause MMJ's actual future results, performance or achievements to be materially different from those expected, planned or intended, recipients should not place undue reliance on these intentions, expectations, future plans, strategy and prospects. MMJ does not warrant or represent that the actual results, performance or achievements will be as expected, planned or intended. Nothing in this material should be construed as either an offer to sell or a solicitation of an offer to buy or sell securities. It does not include all available information and should not be used in isolation as a basis to invest in MMJ. This document does not constitute any part of any offer to sell, or the solicitation of an offer to buy, any securities in the United States or to, or for the account or benefit of any "US person" as defined in Regulation S under the US Securities Act of 1993 ("Securities Act"). MMJ's shares have not been, and will not be, registered under the Securities Act or the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold in the United States or to any US person without being so registered or pursuant to an exemption from registration including an exemption for qualified institutional buyers.
MMJ Group Holdings Limited | 2 |
only Investment Portfolio Report
use31 October 2021
personalForImportant Notice
This announcement contains reference to certain intentions, expectations, future plans, strategy and prospects of MMJ. Those intentions, expectations, future plans, strategy and prospects may or may not be achieved. They are based on certain assumptions, which may not be met or on which views may differ and may be affected by known and unknown risks. The performance and operations of MMJ may be influenced by a number of factors, many of which are outside the control of MMJ. All information is unaudited unless stated otherwise. No representation or warranty, express or implied, is made by MMJ, or any of its directors, officers, employees, advisers or agents that any intentions, expectations or plans will be achieved either totally or partially or that any particular rate of return will be achieved. Given the risks and uncertainties that may cause MMJ's actual future results, performance or achievements to be materially different from those expected, planned or intended, recipients should not place undue reliance on these intentions, expectations, future plans, strategy and prospects. MMJ does not warrant or represent that the actual results, performance or achievements will be as expected, planned or intended. Nothing in this material should be construed as either an offer to sell or a solicitation of an offer to buy or sell securities. It does not include all available information and should not be used in isolation as a basis to invest in MMJ. This document does not constitute any part of any offer to sell, or the solicitation of an offer to buy, any securities in the United States or to, or for the account or benefit of any "US person" as defined in Regulation S under the US Securities Act of 1993 ("Securities Act"). MMJ's shares have not been, and will not be, registered under the Securities Act or the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold in the United States or to any US person without being so registered or pursuant to an exemption from registration including an exemption for qualified institutional buyers. The investment returns shown are historical and no warranty can be given for future performance. Historical performance is not a reliable indicator of future performance. Due to the volatility in a Company's underlying assets and other risk factors associated with investing, investment returns can be negative, particularly in the short-term.
onlyportfolio which concentrates on producing capital growth for shareholders over the medium to long term from investments in listed and unlisted equities and other financial assets.
About MMJ
MMJ Group Holdings Limited (ASX: MMJ) is an Australian- listed, specialist investment company that has traded on the ASX since 2015. Investors in MMJ gain exposure to a
useInvestments are managed by Parallax Ventures Inc., a specialist management company in Canada, under a long- term strategic partnership.
Since 2015, MMJ has created a significant number of investment opportunities from its connections in Canada and Australia in the private investment sector and realised exits to the benefit of MMJ and its shareholders:
21 | 9 | 4 | 10 |
personal | Follow on | Private | Sale of |
Primary | |||
Acquisitions | investments1 | to public | investments |
MMJ Investment Performance23
MMJ Historical Performance - period ended | 31-Oct-21 | |||||||||
1 month | 3 months | Financial year to | 12 months | Since | ||||||
date | inception | |||||||||
Pre tax return | (4)% | (10)% | (11)% | (0)% | (15)% | |||||
Benchmark | (6)% | (26)% | (35)% | 26% | (21)% | |||||
Out/(under) | 2% | 17% | 24% | (26)% | 6% | |||||
performance | ||||||||||
For MMJ's latest investor presentations and news, please | ||||||||||
visitwww.mmjgh.com.au | ||||||||||
General Investor Queries | Share Registry | |||||||||
E: info@mmjgh.com.au | Automic Registry Services | |||||||||
W: mmjgh.com.au | P: | 1300 288 664 | ||||||||
For | W: | automic.com.au | ||||||||
Investment Portfolio Report
MMJ Group Holdings Limited (ASX: MMJ) | ABN 91 601 236 417
Performance Update
Net Tangible Asset Value Per Share Before Tax4 as at 31 October 2021
$0.1681
Net Asset Value as at 31 October 2021
$36m
Investment Return for 12 months ended 31 October 2021
(0)% p.a.
Key Metrics as at | 31-Oct-21 | AUD | |
Net Asset Value | m | 36 | |
Investee Porfolio (ex cash) | m | 32 | |
Cash | m | 6 | |
Net Tangible Asset per share - | 0.1681 | ||
pre-tax (issued pursuant to LR 4.12) | |||
Net Tangible Asset per share - | 0.1562 | ||
post tax (issued pursuant to LR 4.12) | |||
Net Asset Value per share | 0.1565 | ||
MMJ share price (ASX) | 0.069 | ||
Market capitalisation | m | 16 | |
Number of investments (ex cash) | 9 | ||
ASX Investment Type | Listed | ||
Investment | |||
Company | |||
Initial Public Offering Date (inception date) | 22-Jan-15 | ||
No. of ordinary shares on issue | m | 230 |
MMJ shareholder communications
Webinars and copies of announcements related to MMJ's operations may be found on the MMJ website: www.mmjgh.com.au.
MMJ will host a live audio webinar of the Investor Conference Call on 17 November 2021. In this webinar, Michael Curtis, MMJ Non-Executive Director and Managing Partner of Parallax Ventures Inc, the asset manager of MMJ's investments, will give an update on the Canadian cannabis demand and update on major investments.
- Includes investments in existing investees.
- Inception is 30 June 2018 being the date when MMJ commenced accounting for investments as an investment entity.
- MMJ uses the Alternative Harvest ETF (ticker symbol MJ) as its investment benchmark for the MMJ portfolio as it is a highly liquid portfolio trading in the
North American market (where most of MMJ's holdings are based). MJ is listed on the New York Stock Exchange.
4.Net Tangible Asset Value per share - unaudited, before tax on unrealised gains on investment portfolio. The financial information within this report is unaudited.
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Investment Portfolio Report
MMJ Group Holdings Limited (ASX: MMJ) | ABN 91 601 236 417
onlyPerformance of MMJ Portfolio as at 31 October 2021
During the four months ended 31 October 2021, MMJ's Net Asset Value (before provision for deferred tax) decreased 11%. This was a favourable performance compared to our benchmark, which declined 35% over the same period reflecting in large part a decline of similar magnitude in the listed Canadian cannabis sector. Performance for the 12 months to 31 October 2021 was flat.
The MMJ portfolio remains heavily weighted to unlisted investments. MMJ's listed assets and unlisted assets5 are directly usevalued with reference to a listed security price representing 34% of MMJ's portfolio at 31 October 2021. The significant
unlisted bias positively impacted the performance relative to the benchmark over the year to date. However, it continues to be a material contributor to the sustained discount (56%) that the MMJ share price trades to its NAV.
Proposal to Broaden MMJ's Investment Mandate
MMJ announced that its 2021 Annual General Meeting (AGM) would be held as a virtual meeting on 17 December 2021. The AGM will include two items of Special Business.
- Broadening MMJ's Investment Mandate
The Company is proposing, subject to Shareholder approval at the AGM, to broaden its existing investment mandate. If approved, the current restriction that limits the Company's investments in non-cannabis assets to 25% of its total assets would be removed. The Company believes that there are opportunities to enhance the returns to Shareholders by further diversifying its investment portfolio to include strategic investments in sectors outside of Cannabis (Diversification). The Company has already made significant steps over the past twelve months to diversify the portfolio through investments in the consumer branded products and healthcare sectors.
The proposed Diversification will allow the Company to:
personal | i. | expand its existing investment portfolio and invest in other industries with a view to delivering capital growth over the |
medium to long term; and | ||
ii. | create greater opportunities for Shareholders to benefit from the growth of a diversified group of investments, in | |
addition to the Company's existing investments. | ||
The proposed Diversification is an internal process, which will broaden the Company's existing investment strategy with | ||
Parallax Ventures Inc. continuing to be the Investment Manager of the Company's investments. | ||
b) | Change in Company Name | |
The Company is proposing, subject to Shareholder approval at the AGM, to change its name to "Hygrovest Limited". | ||
The Board proposes this change of name on the basis that it believes the proposed name more accurately reflects the future operations of the Company in line with the proposed broadening of the Company's investment mandate.
Funding Position
ForMMJ is well positioned to create value from its existing portfolio with a liquid balance sheet and cashflows from its investments. MMJ has total assets of $39m, with immaterial current liabilities, comprising cash of AUD6m and a portfolio of listed equities (CAD4m), listed convertible loans (CAD3.7m) and unlisted loan securities (CAD3.5m), which provide interest income with flexibility to fund flow on investments, effect timing of investment exits and MMJ's operating requirements. During October, MMJ received a tax refund of $4.6m in respect of the financial year ended 30 June 2021.
Investment Portfolio
MMJ's portfolio management is focussing on creating a portfolio that invests in private (typically pre-IPO) and public companies in high growth industries, where the MMJ Board perceives there to be material upside potential.
MMJ entered the 2022 financial year expecting that one or more of its key unlisted investee companies would move to realise their inherent value by a liquidity event6. This would be positive for MMJ, after FY21 when a number of unlisted investee companies deferred their IPO intentions.
- These assets comprise Embark Health (uses the listed Bevcanna share price ) and VWE which uses the VWE security prices
- A liquidity event may include a public listing on recognised stock exchange, a sale of 100% of the investee or sale of MMJ's own investment in our own right
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MMJ Phytotech Ltd. published this content on 11 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 November 2021 07:26:04 UTC.