NAOS CEO Insights

CEO INSIGHTS – Week Ending 28 February 2020 By NAOS Asset Management

February 28, 2020

“Personalization is a global megatrend and we are seeing growing numbers of consumers worldwide who customize their Crocs footwear” Andrew Rees, CEO, Crocs Footwear Inc

CEO INSIGHTS – Week Ending 28 February 2020 By NAOS Asset Management

“Personalization is a global megatrend and we are seeing growing numbers of consumers worldwide who customize their Crocs footwear” Andrew Rees, CEO, Crocs Footwear 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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Media & Advertising

“The [out-of-home advertising] sector continues to benefit from structural changes in the media market including the ability to make ‘one to many’ advertising geographically and contextually relevant, further enabled by data and digitization” Brendon Cook, CEO, oOh!media Ltd

“Overall advertising market conditions across most categories have remained softer-than-anticipated for the start of 2020” Hugh Marks, CEO, Nine Entertainment Group Ltd

“In terms of marketing, there probably is a lot of waste in the industry” Glenn Fogel, CEO, Booking Holdings Inc

Residential Property

“We have seen a strong start to activity in January with an increased number of vendors who have gone to market early and benefited from strong demand and continued rising values during the last quarter of 2019. We believe this will have a positive impact on vendor sentiment for the second half” Geoff Lucas, CEO, Mcgrath Ltd

Domestic Construction

“1H FY2020 saw a favourable turnaround in domestic sales on stronger underlying demand compared to 2H FY2019” Market Announcement, BlueScope Steel Ltd

“Whilst the short-term outlook remains subdued, we expect east coast demand to improve in 2021, with the benefit of stimulus from fiscal and monetary policy measures” Nick Miller, CEO, Adelaide Brighton Ltd

“On a positive note, Western Australian cement demand stabilised during 2019, with cement volumes slightly up on the previous year, driven by increased resources sector activity and a number of new infrastructure projects” Nick Miller, CEO, Adelaide Brighton Ltd

Domestic Consumer

“Despite record low interest rates and tax stimulus, the economy remains depressed and there's still high levels of consumer indebtedness - most of the tax stimulus went into paying off debt instead of retail” Ian Moir, CEO, David Jones Pty Ltd

Food & Beverage

“From mid-February we have seen an increase in purchase activity for products through the corporate diagou channel” Kristy Carr, CEO, Bubs Australia Ltd

“[Hard seltzers or carbonated alcoholic drinks] are a way to broaden the category for sure, to start appealing to consumers who don’t have beer as their preferred beverage, it solves many problems—bloating, flavor, carbs, calories—lots of things.” Carlos Brito, CEO, AB InBev (the world's largest brewer)

Coronavirus

“In our stores that are slightly more skewed towards supporting and serving our Asian customers and we are starting to see a little bit of softness there of course as we don’t see the students flowing into our supermarkets” Brad Banducci, CEO, Woolworths Group Ltd

“I think the coronavirus, and all the implications around it are far larger. I think the market has misinterpreted the degrees of what the coronavirus can do and I am talking specifically about trade with China” Laurence Fink, CEO, Blackrock Inc

 “The Chinese government has many possible stimulus measures at its disposal. And we expect them to act. We believe this impact will have a positive impact later in the year” Jean-Sebastian Jacques, CEO, Rio Tinto Ltd

“As I said many, many times here. Travel is a basic need for people. They have been doing it for a very, very long time. And as soon as the air clear so to speak, you'll see people will be coming back to travel” Glenn Fogel, CEO, Booking Holdings Inc

Technology

“The high-growth AI [artificial intelligence] market continues to rely on high quality training data. Furthermore, obtaining data is identified as a major challenge” Market Announcement, Appen Ltd

Climate Change

''This will require a complex trade-off which means we, all of us, need to face up to some challenging decisions, for shareholders, are you willing to see a reduction in shareholder returns to finance climate action?" Jean-Sebastien Jacques, CEO, Rio Tinto

 
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.