Longleaf Partners
Fund

Experience

Joined

Location

Education

Longleaf Partners Fund seeks to generate superior long-term investment returns and minimize the risk of permanent capital loss by investing primarily in a concentrated number of US companies that meet our Business, People, Price investment criteria.

We invest with a three-to-five-year investment horizon and take advantage of short-term volatility to own high quality businesses, run by capable management teams, whose stock prices we believe are trading temporarily at a discount. Our extensive, global network allows us to engage with our management partners to help drive long-term value creation.

1 (800) 445-9469

Longleaf Partners Fund

Fund overview (Updated 9/30/19)

Inception Date

4/8/1987

5 Yr Avg. Turnover

28

Minimum

$10,000

Net Assets

$1.8 billion

Total Holdings

16

Ticker

LLPFX

Expense Ratio (Gross/Net)

0.97%/0.79%

Wtd. Avg. Market Cap

$72.4 billion

CUSIP

54306910-8

Portfolio

Fund Information

  • The Fund’s objective is long-term capital growth. Current income is not an objective.
  • The Fund primarily owns common stock or securities convertible into common stock but may purchase other types of securities.
  • The Fund may invest up to 30% of its assets in non-U.S. securities, which could include emerging market issuers, and may achieve its exposure to non-U.S. securities through investing in American depositary receipts (ADRs).
  • The Fund invests generally in companies with market capitalizations over $5 billion.
  • The benchmark index is S&P 500, though portfolio construction is 100% bottom-up and benchmark-agnostic.
  • If we cannot find qualifying investments, we will hold cash.
  • The Fund is non-diversified under federal securities laws and generally invests in 18-22 companies.
  • Southeastern employees, related parties and Longleaf trustees are the largest shareholder group with a collective investment of over $400 million.
  • The Fund’s assets are held primarily by institutional clients.
  • Our relationships are long-term. The average direct account tenure is between 5-10+ years.
  • If size begins to inhibit our ability to manage the Fund, we will close to new investors.

Fund Managers

O. Mason
Hawkins, CFA

Chairman

More about me
You want to pursue a career in investing for the intellectual challenge, for the reward of being correct about your investment decisions and for the opportunity to help others.

Chairman Mason Hawkins founded Southeastern in 1975 and oversees the company with 47 years of investment experience. He is a co-portfolio manager on the Longleaf Partners, Small-Cap, International and Global Funds, as well as the Longleaf Partners Global UCITS Fund. Mr. Hawkins is a member of Southeastern’s Executive Committee. Prior to the Southeastern’s founding, he served as Director of Research for both Atlantic National Bank in Jacksonville, FL and First Tennessee Investment Management in Memphis. Mr. Hawkins graduated with a bachelor’s degree in Finance from the University of Florida and received his master’s in Business Administration in Finance from the University of Georgia.

47
1975
Memphis
BA (Finance)
University of Florida
MBA (Finance)
University of Georgia

G. Staley
Cates, CFA

Vice-Chairman

More about me
We want to be a kind of researcher’s nirvana, which we think starts with analysts being able to look at any idea anywhere in the world.

Mr. Cates serves as Vice-Chairman of Southeastern and has 33 years of investment experience. He is a co-portfolio manager on the Longleaf Partners, Small-Cap, International and Global Funds, as well as the Longleaf Global UCITS Fund. Mr. Cates is a member of Southeastern’s Executive Committee. Prior to joining the company in 1986, he worked as a Research Associate at Morgan, Keegan & Co. in Memphis. Mr. Cates graduated from the University of Texas with a bachelor’s degree in Business Administration.

33
1986
Memphis
BA (Business Administration)
University of Texas

Ross
Glotzbach, CFA

CEO and Head of Research

More about me
Southeastern is different because we are focused on a single investment discipline – we are long-term, concentrated, engaged value investors.

Mr. Glotzbach serves as CEO and Head of Research and has 16 years of investment experience. He is a co-portfolio manager on Longleaf Partners, Small-Cap and Global Funds, as well as the Longleaf Partners Global UCITS Fund. Mr. Glotzbach is a member of Southeastern’s Executive Committee. Prior to joining Southeastern in 2004, he was a Corporate Finance Analyst at Stephens Inc. in Little Rock, AR. Mr. Glotzbach graduated from Princeton University with a bachelor’s degree in Economics.

16
2004
Memphis
BA (Economics)
Princeton University

Investment Discipline

Southeastern manages all mandates and portfolios using the same investment discipline.

Our Investment Approach

We are long-term, concentrated, engaged value investors.

The Investment Process

We are fundamental, bottom-up business appraisers.

Risk Management

We seek to minimize the risk of permanent capital loss.

Top 10 Holdings

at 9/30/19

Holding Country Industry Percent
CenturyLink United States Diversified Telecommunication Services 9.8%
CK Hutchison Hong Kong Industrial Conglomerates 7.3%
General Electric United States Industrial Conglomerates 7.2%
Mattel United States Leisure Products 6.3%
FedEx United States Air Freight & Logistics 6.1%
CNH Industrial Netherlands Machinery 5.6%
Fairfax Financial Canada Insurance 4.8%
LafargeHolcim Switzerland Construction Materials 4.8%
CNX Resources United States Oil, Gas & Consumable Fuels 4.6%
Affiliated Managers Group United States Capital Markets 4.6%
Total 61.1%
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Primary Contributors to Return

From 7/1/19 to 9/30/19

Holding Percent
CenturyLink 0.73%
Alphabet 0.44%
Comcast 0.40%

Primary Detractors to Return

From 7/1/19 to 9/30/19

Holding Percent
General Electric -1.24%
FedEx -0.69%
CK Hutchison -0.65%

Portfolio Composition

at 9/30/19

Equities & Other 84.8%
Bonds 0.0%
Cash 15.2%
Total 100%
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Sector Composition

at 9/30/19

Industrials 30.3%
Communication Services 18.0%
Consumer Discretionary 9.4%
Financials 9.4%
Real Estate 8.3%
Materials 4.8%
Energy 4.6%
Cash 15.2%
Total 100%
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View current month-end performance Returns reflect reinvested capital gains and dividends but not the deduction of taxes an investor would pay on distributions or share redemptions. The performance data quoted represents past performance and is no guarantee of future results. The return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance quoted.

 

Before investing in any Longleaf Partners fund, you should carefully consider the Fund’s investment objectives, risks, charges, and expenses. The Prospectus and Summary Prospectus contain this and other important information.  Please read the Prospectus and Summary Prospectus carefully before investing.

The above holdings do not represent all of the securities purchased, sold, or recommended for the Fund. Discussion of particular investments is not a recommendation to buy or sell any security and holdings are subject to change.

 

Performance

Quarter-end Performance

at 09/30/19

Fund Index 1 MO QTR YTD 1 YR 3 YR 5 YR 10 YR 20 YR Incept †
Total Returns Average Annual Returns
Partners Fund 2.71% -3.11% 5.29% -16.47% 0.59% -0.16% 6.61% 5.68% 9.49%
S&P 500 Index 1.87% 1.70% 20.55% 4.25% 13.39% 10.84% 13.24% 6.33% 9.84%
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Month-end Performance

at 10/31/19

Fund Index 1 MO QTR YTD 1 YR 3 YR 5 YR 10 YR 20 YR Incept †
Total Returns Average Annual Returns
Partners Fund 3.68% -1.57% 9.16% -6.39% 1.73% 0.35% 7.46% 5.78% 9.58%
S&P 500 Index 2.17% 2.43% 23.16% 14.33% 14.91% 10.78% 13.70% 6.12% 9.88%
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Daily Price

at 11/12/19

Fund Ticker Inception Date Price Change % Change YTD Return
Partners Fund LLPFX 04/08/87 20.83 -0.09 -0.43% 13.52%
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Calendar Year Total Returns

From 1987 to 2018

Year 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987†
Fund -17.98% 15.51% 20.72% -18.80% 4.92% 32.12% 16.53% -2.85% 17.89% 53.60% -50.60% -0.44% 21.63% 3.62% 7.14% 34.80% -8.34% 10.34% 20.60% 2.18% 14.28% 28.25% 21.02% 27.50% 8.96% 22.20% 20.47% 39.19% -16.35% 23.26% 35.19% -12.96%
S&P 500 Index -4.38% 21.83% 11.96% 1.38% 13.69% 32.39% 16% 2.11% 15.06% 26.46% -37% 5.49% 15.79% 4.91% 10.88% 28.68% -22.1% -11.89% -9.1% 21.04% 28.58% 33.36% 22.96% 37.58% 1.32% 10.08% 7.62% 30.47% -3.1% 31.69% 16.61% -13.27%
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† The inception date is 4/8/87. During the inception year, the S&P 500 Index was available only at month-end; therefore the S&P 500 value at 3/31/87 was used to calculate performance since inception.

Returns reflect reinvested capital gains and dividends but not the deduction of taxes an investor would pay on distributions or share redemptions. The performance data quoted represents past performance and is no guarantee of future results. The return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance quoted.

Before investing in any Longleaf Partners fund, you should carefully consider the Fund’s investment objectives, risks, charges, and expenses. The Prospectus and Summary Prospectus contain this and other important information.  Please read the Prospectus and Summary Prospectus carefully before investing.

Risks
The Longleaf Partners Fund is subject to stock market risk, meaning stocks in the Fund may fluctuate in response to developments at individual companies or due to general market and economic conditions. Also, because the Fund generally invests in 15 to 25 companies, share value could fluctuate more than if a greater number of securities were held. Mid-cap stocks held may be more volatile than those of larger companies. The total expense ratio for the Longleaf Partners Fund is 0.97% (gross) and 0.79% (net). Effective August 12, 2019, Southeastern has contractually committed to limit operating expenses (excluding interest, taxes, brokerage commissions and extraordinary expenses) to 0.79% of average net assets per year. This agreement is in effect through at least April 30, 2021 and may not be terminated before that date without Board approval.

S&P 500® is a trademark of The McGraw-Hill Companies, Inc.

Resources
Distributions

Distributions

Most of Longleaf’s distributions historically have been long-term gains, reflecting Southeastern’s successful results and long investment horizon. Per share amounts are rounded. For tax return preparation, please use your Form 1099-DIV or see the 2018 Sources of Distribution.

Year Total Net Income ST Gains LT Gains Return Cap Ex-Date Reinvest
2018 $ 0.4705 $ 0.4705 $ - $ - $ - 12/28/18 $ 18.3000
3.6563 - - 3.6563 - 11/30/18 21.5500
2017 0.3289 0.3289 - - - 12/28/17 26.9200
2.0460 - - 2.0460 11/16/17 26.1500
2016 0.0025 0.0025 - - - 12/29/16 25.5100
0.5312 - - 0.5312 - 11/16/16 25.2900
2015 0.2970 0.2970 - - - 12/29/15 21.7500
3.7040 - 0.0070 3.6970 - 11/12/15 22.2300
2014 0.1960 0.1960 - - - 12/30/14 31.5000
4.0300 - - 4.0300 - 11/12/14 31.8700
2013 0.0800 0.0800 - - - 12/30/13 33.6300
0.9850 - - 0.9850 - 11/8/13 32.1600
2012 0.2700 0.2700 - - - 12/28/12 26.0700
4.2450 - 0.3050 3.9400 - 11/8/12 25.7700
2011 0.1280 0.1280 - - - 12/29/11 26.7700
0.6900 - - 0.6900 - 11/8/11 27.2800
2010 0.1400 0.1400 - - - 12/29/10 28.3400
2009 0.0100 0.0100 - - - 12/16/09 23.7600
2008 0.0300 0.0300 - - - 12/30/08 15.4000
0.6730 0.0014 - 0.6716 - 11/6/08 16.0100
2007 0.0680 0.0680 - - - 12/27/07 33.5100
1.5850 - 0.0050 1.5800 - 11/7/07 35.6400
2006 0.1440 0.1440 - - - 12/27/06 35.1100
2.6425 - 0.0725 2.5700 - 11/8/06 34.6800
2005 0.2900 0.2900 - - - 12/28/05 31.2100
1.1800 - 0.1800 1.0000 - 11/9/05 30.8600
2004 0.1480 0.1442 - 0.0038 - 12/29/04 31.2800
0.6250 - - 0.6250 - 11/11/04 30.1700
2003 NONE - - - - - -
2002 0.0860 0.0387 - - 0.0473 12/26/02 22.3900
0.1355 - 0.0044 0.1311 - 11/13/02 21.6700
2001 0.1950 0.1950 - - - 12/28/01 24.6700
0.3290 - 0.0730 0.2560 - 11/14/01 22.8600
2000 0.1520 0.1520 - - - 12/28/00 22.7600
1.7169 - 0.0097 1.7072 - 11/8/00 21.2200
1999 0.2880 0.2880 - - - 12/29/99 20.0900
4.2300 - 0.1860 4.0440 - 11/9/99 21.2400
1998 0.2470 0.2470 - - - 12/30/98 24.2200
4.8100 - 0.0430 4.7670 - 11/18/98 23.4600
1997 3.3250 0.2140 0.2610 2.8500 - 12/31/97 25.9800
1996 2.7640 0.3830 0.7200 1.6610 - 12/27/96 23.0100
1995 0.6840 0.2400 0.2340 0.2100 - 12/27/95 21.0600
1994 1.2992 0.1600 0.0522 1.0870 - 12/21/94 17.0320
1993 1.0446 0.0934 0.0285 0.9228 - 12/29/93 16.8790
1992 1.3632 0.0710 0.2443 1.0480 - 12/29/92 14.5840
1991 0.8429 0.0552 0.7877 - - 12/27/91 12.9290
1990 0.1114 0.0780 0.0334 - - 12/28/90 10.0570
0.2656 0.0680 0.0332 0.1644 - 6/29/90 11.8840
1989 0.0790 0.0790 - - - 12/28/89 12.4510
1.5300 - 1.3450 0.1850 - 11/3/89 12.6880
0.0700 0.0700 - - - 7/31/89 14.6580
1988 0.0600 0.0600 - - - 12/29/88 11.5662
1987 0.0791 0.0791 - - - 12/31/87 8.6247

2018 Distributions

Tax Reporting Information

ICI File Layouts

Data for intermediaries who process 1099s for their clients.

General Mutual Fund Distribution Information

All mutual funds must distribute earned income and realized capital gains annually to shareholders.

Tax treatment is the same whether shareholders receive cash or reinvested shares.

A fund's NAV declines by the distribution amount, but the decline is unrelated to performance since shareholders receive the difference in cash or additional shares.

Accurately tracking returns requires increasing the number of shares to account for reductions in NAV when distributions occur.

Capital gains reflect appreciation over the full period that the fund held a security. Distributed gains have no relationship to either that year's fund performance (a fund could pay a distribution in a flat return year) or an individual's fund investment (all shareholders as of the distribution date receive the payout regardless of their purchase date or price).

Longleaf Distribution Information

Longleaf generally pays capital gains distributions in late November and income distributions in late December.

Most Longleaf shareholders reinvest their distributions, thereby maintaining account balances while owning more fund shares.

Longleaf generally posts capital gain distribution estimates on the website by mid-October.

Tax reporting information is mailed with 1099-DIV forms by mid-February.

Longleaf may penalize those who sell fund shares to avoid a distribution since they place a larger tax burden on remaining owners and potentially disrupt the fund's investment strategy.