NAOS CEO Insights

CEO INSIGHTS – Week Ending 14 May 2021 By NAOS Asset Management

May 14, 2021

“This [space travel] is something that I think most of us in the world would not have guessed, even a few years ago that this is going to happen in our lifetimes and yet, here it is upon us” Michael Colglazier, CEO, Virgin Galactic Holdings Inc

CEO INSIGHTS – Week Ending 14 May 2021 By NAOS Asset Management

“This [space travel] is something that I think most of us in the world would not have guessed, even a few years ago that this is going to happen in our lifetimes and yet, here it is upon us” Michael Colglazier, CEO, Virgin Galactic Holdings Inc


As part of the NAOS investment process, we pay particular attention to the comments made by company CEOs and business leaders in order to gain a greater understanding of the current investment environment and key trends that may be emerging. Below are quotes from the week which in our view detail some of the most important and prominent industry trends and economic factors impacting their businesses.  
 
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Financial Markets & Cryptocurrency

“Capital markets today are very robust” Bruce Flatt, CEO, Brookfield Asset Management Inc

“We've always assumed that for this industry to reach a billion people using the crypto economy, which is what we want to do, it's going to have to be a regulated industry” Brian Armstrong, CEO, Coinbase Global Inc [global cryptocurrency exchange]

“There's more and more assets being created in the crypto economy. I think it's going to be something, kind of like apps in the App Store on the iPhone where there's eventually millions of these assets created over time” Brian Armstrong, CEO, Coinbase Global Inc [global cryptocurrency exchange]

Finance & Lending

“We have seen a pipeline of business lending opportunities develop that we have not experienced for many years” Ross McEwan, CEO, National Australia Bank Ltd

“The recent growth in lending to investors is what the banks are now needing to watch carefully as it is generally higher risk and more speculative” Matt Comyn, CEO, Commonwealth Bank of Australia Ltd

Automotive

“Demand for new and used motorcycles remains consistent and strong and is showing no signs of slowing down” Market Statement, Motorcycle Holdings Ltd

“This [microchip shortage] is an issue that is affecting almost every [car] manufacturer and I would say in almost every market across the world” James Voortman, CEO, Australian Automotive Dealers Association

Domestic Economy

“Australia is at a crossroads. There are two inevitable global forces: digitisation and decarbonisation. We either respond and reap the benefits or get relegated to second rate” Mike Cannon-Brookes, Co-CEO, Atlassian Inc

“They’ve thrown a heap of money at us. Obviously, we’re stimulating the economy with these latest handouts. It’s just extraordinary...and it seems to be happening in other countries as well - there seems to be this worldwide view you throw money at stuff” Gerry Harvey, Chairman, Harvey Norman Holdings Ltd

Construction

“We believe the construction industry has the ability to deliver a stronger-for-longer cycle” Nick Miller, CEO, ADBRI Ltd

Labour Markets

“We expect the current challenges, COVID-19 and emerging Australian labour market conditions, to continue beyond the end of FY21 and into FY22” Market Statement, Perenti Global Ltd

“Labour is a challenge for everybody in the channel” Bryan Fairbanks, CEO, Trex Decking Inc [world’s largest decking manufacturer]

Commercial Property

“We believe that office space will continue to be important for collaboration, innovation, teamwork, culture and experiential learning but the way offices are used will continue to evolve” Bob Johnston, CEO, GPT Group

Travel, Tourism & Leisure

“We've seen demand pick up quickly and meaningfully in countries with early and swift vaccine rollouts” Anthony Capuano, CEO, Marriott International Inc.

“This [space travel] is something that I think most of us in the world would not have guessed, even a few years ago that this is going to happen in our lifetimes and yet, here it is upon us” Michael Colglazier, CEO, Virgin Galactic Holdings Inc

Healthcare

“We're excited to see the growing level of understanding and acceptance of telehealth, especially for dentistry. We believe there will only be increased consumer and clinical adoption of the telehealth model from here” David Katzman, CEO, SmileDirectClub Inc [multinational telehealth dentistry company]

Food & Beverage

“How customers acquire food has changed forever” Market Statement, Marley Spoon AG

“It is also clear that the daigou/reseller channel has been cyclically impacted by COVID-19, regulatory and other structural factors” Market Statement, The A2 Milk Company Ltd

“Global demand for vegetable oils remains elevated” Robert Spurway, CEO, GrainCorp Ltd

Agriculture

“Good sub-soil moisture across many parts of ECA [east coast Australia] is also positive for current winter crop planting” Robert Spurway, CEO, GrainCorp Ltd

Energy & Resources

“The national oil companies and large independents remaining more active and given the fairly strong oil price recovery that we are seeing during the quarter and the volume of delayed activity from 2020, I believe we will see increasing spending going forward, particularly in the second half of the year” Sophie Zurquiyah, CEO, CGG SA [multinational oil services provider]

Technology

“Cloud infrastructure will eventually replace IT infrastructure, empowering enterprises to achieve digital operation” Daniel Zhang, CEO, Alibaba Group Ltd

Environmental, Social & Governance

“Today's customers, colleagues, communities and investors rightly expect more” Marco Gobbetti, CEO, Burberry Inc

Important information: This material has been prepared by NAOS Asset Management Limited (ABN 23 107 624 126, AFSL 273529) (NAOS) for general information purposes only and must not be construed as investment advice. Certain economic, market or company information contained in this material may have been obtained from published sources prepared by third parties. Nothing contained herein should be construed as granting by implication or otherwise, any license or right to use such third party content without the written permission of the owner.