Longleaf Partners
International Fund

Experience

Joined

Location

Education

Longleaf Partners International 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 non-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 International Fund

Fund overview (Updated 9/30/19)

Inception Date

10/26/1998

5 Yr Avg. Turnover

32%

Minimum

$10,000

Net Assets

$1.2 billion

Total Holdings

21

Ticker

LLINX

Expense Ratio (Gross/Net)

1.18%/1.15%

Wtd. Avg. Market Cap

$12.8 billion

CUSIP

54306940-5

Portfolio

Fund Information

  • The Fund’s objective is long-term capital growth. Current income is not an objective.
  • The Fund normally invests at least 65% of its total assets in the equity securities of non-US issuers, which could include emerging market issuers, and may achieve its exposure to non-US securities through investing in American depositary receipts (ADRs).
  • The Fund invests generally in companies with market capitalizations over $1 billion.
  • The benchmark index is MSCI EAFE , though portfolio construction is 100% bottom-up and benchmark-agnostic.
  • If we cannot find qualifying investment opportunities, 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 $475 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

Ken
Siazon

Head of Asia, Principal

More about me
We actively recycle capital from more fully valued investments to new qualifying investments, which we believe represent the highest and best use of our capital today. We continuously strive to maximize risk-adjusted returns for the future for us and our investment partners.

Mr. Siazon heads our Asian research. He is co-portfolio manager for Longleaf Partners International Fund and the lead portfolio manager for Longleaf Partners Asia Pacific UCITS Fund. Prior to joining the company in 2006, he worked with Lehman Brothers in Singapore, Tokyo and Hong Kong, JP Morgan in Hong Kong and New York, Ford Motor Company in Tokyo and Fuji Bank in Tokyo. Mr. Siazon received his bachelor’s degree in Systems Engineering from the University of Virginia and holds a master’s in Business Administration from Harvard Business School.

30
2006
Singapore
BS (Systems Engineering)
University of Virginia
MBA
Harvard Business School

Josh
Shores, CFA

Portfolio Manager, Principal

More about me
We aim to think like a private buyer of a company, an owner of businesses. The key word there is “owner.” We’re thinking and acting like owners in every investment we make.

Mr. Shores is a co-portfolio manager for Longleaf Partners International Fund and a member of Southeastern’s Executive Committee. After seven years in Southeastern’s London office, Mr. Shores is now based in Memphis. He splits his time between our Memphis and global offices and remains focused on Non-US investments. He joined Southeastern in 2007 after working at Smith, Salley & Associates in Greensboro, NC and Franklin Street Partners in Chapel Hill, NC. Mr. Shores holds bachelor’s degrees in Philosophy and Religious Studies from the University of North Carolina.

17
2007
Memphis & London
BA (Philosophy and Religious Studies)
University of North Carolina

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
EXOR Netherlands Diversified Financial Services 9.1%
Melco International Hong Kong Hotels, Restaurants & Leisure 6.7%
LafargeHolcim Switzerland Construction Materials 6.5%
CK Hutchison Hong Kong Industrial Conglomerates 6.1%
MinebeaMitsumi Japan Machinery 6.0%
LANXESS Germany Chemicals 5.5%
C&C Group Ireland Beverages 4.9%
Domino's Pizza Group United Kingdom Hotels, Restaurants & Leisure 4.8%
Lazard United States Capital Markets 4.6%
Bollore France Air Freight & Logistics 4.6%
Total 58.8%
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Primary Contributors to Return

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

Holding Percent
Melco International 0.45%
Gruma 0.25%
LANXESS 0.18%

Primary Detractors to Return

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

Holding Percent
Great Eagle -0.83%
OCI -0.59%
CK Hutchison -0.57%

Portfolio Composition

at 9/30/19

Equities & Other 97.0%
Bonds 0.0%
Cash 3.0%
Total 100%
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Sector Composition

at 9/30/19

Industrials 18.7%
Financials 17.9%
Materials 15.8%
Consumer Discretionary 14.4%
Consumer Staples 11.4%
Communication Services 10.9%
Real Estate 7.9%
Cash 3.0%
Total 100%
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Country Composition

at 9/30/19

Hong Kong 20.7%
Netherlands 12.9%
Switzerland 9.4%
Mexico 6.5%
Japan 6.0%
Germany 5.5%
Ireland 4.9%
United Kingdom 4.8%
United States 4.6%
France 4.6%
Canada 4.2%
China 4.1%
Sweden 3.7%
India 3.1%
Denmark 2.0%
Cash 3.0%
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
International Fund 1.68% -5.32% 7.34% -3.29% 7.29% 3.64% 4.54% 5.89% 7.19%
MSCI EAFE Index 2.87% -1.07% 12.80% -1.34% 6.48% 3.27% 4.90% 3.72% 4.40%
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Month-end Performance

at 11/30/19

Fund Index 1 MO QTR YTD 1 YR 3 YR 5 YR 10 YR 20 YR Incept †
Total Returns Average Annual Returns
International Fund 0.56% 8.42% 14.46% 11.75% 9.46% 5.00% 5.34% 6.34% 7.46%
MSCI EAFE Index 1.13% 7.76% 18.17% 12.44% 9.62% 4.26% 5.32% 3.59% 4.60%
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Daily Price

at 12/12/19

Fund Ticker Inception Date Price Change % Change YTD Return
International Fund LLINX 10/26/98 17.34 0.24 1.40% 16.75%
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Calendar Year Total Returns

From 1998 to 2018

Year 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998†
Fund -7.08% 24.23% 12.20% -7.91% -14.76% 28.14% 21.23% -20.29% 13.69% 23.17% -39.60% 15.29% 17.07% 12.88% 10.21% 41.52% -16.51% 10.47% 25.93% 24.37% 9.02%
MSCI EAFE Index -13.79% 25.03% 1.00% -0.81% -4.90% 22.78% 17.32% -12.14% 7.75% 31.78% -43.38% 11.17% 26.34% 13.54% 20.25% 38.59% -15.94% -21.44% -14.17% 26.96% 9.27%
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† Inception date is 10/26/98. During the inception year, the EAFE Index was available only at month-end; therefore the EAFE value at 10/31/98 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 International 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.  Investing in non-U.S. securities may entail risk due to non-US economic and political developments, exposure to non-US currencies, and different accounting and financial standards.  These risks may be higher when investing in emerging markets. The total expense ratio for the Longleaf Partners International Fund is 1.18% (gross) and 1.15% (net). The expense ratio is subject to a fee waiver to the extent the Fund’s normal operating expenses exceed 1.15% of average annual net assets.

MSCI World and MSCI EAFE are service marks of MSCI Barra.

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 Foreign Tax Credit ST Gains LT Gains Return Cap Ex-Date Reinvest
2019 $ 0.4686 $ - $ - $ 0.2341 $ 0.2345 $ - 11/27/19 $ 17.07
2018 0.1968 - -0.0115 0.2083 - - 11/30/18 15.6300
2017 0.1772 0.1817 -0.0045 - - - 12/28/17 16.5800
2016 0.3245 0.3309 -0.0064 - - - 12/29/16 13.4400
2015 0.2260 0.2382 -0.0122 - - - 12/29/15 12.5500
0.1410 - - 0.0960 0.0450 - 11/12/15 13.0400
2014 0.5420 0.5669 -0.0249 - - - 12/30/14 13.8300
1.0070 - - 0.1170 0.8900 - 11/12/14 15.1800
2013 0.0500 0.0681 -0.0181 - - - 12/30/13 17.9100
2012 0.2400 0.2400 - - - - 12/28/12 13.9000
0.1334 - - - 0.1334 - 11/8/12 13.2400
2011 0.2150 0.2724 -0.0574 - - - 12/29/11 11.8800
0.1200 - - - 0.1200 - 11/8/11 13.0200
2010 0.1900 0.2163 -0.0263 - - - 12/29/10 15.3800
2009 NONE - - - - - - -
2008 0.0600 0.0701 -0.0276 - - 0.0176 12/30/08 10.9400
0.7400 0.0013 - 0.3980 0.3407 - 11/6/08 10.3500
2007 2.0710 - - 0.0213 2.0497 - 11/7/07 20.2600
2006 0.0146 0.0361 -0.0215 - - - 12/27/06 18.9400
1.3488 - - 0.0338 1.3150 - 11/8/06 18.2400
2005 0.1870 - - - 0.1870 - 11/9/05 16.8100
2004 NONE - - - - - - -
2003 NONE - - - - - - -
2002 0.3154 - - 0.1429 0.1726 - 11/13/02 9.4700
2001 0.1300 0.1451 -0.0151 - - - 12/28/01 12.3300
0.8510 - - 0.4250 0.4260 - 11/14/01 12.4400
2000 0.3750 0.4080 -0.0331 - - - 12/28/00 12.0200
2.6300 - - 1.6000 1.0300 - 11/8/00 12.1100
1999 0.0550 0.0700 -0.0150 - - - 12/29/99 11.9500
0.3300 - - 0.3300 - - 11/9/99 12.2900
1998 0.0051 0.0051 - - - - 12/30/98 9.9300

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.