The Royce International Premier Fund (Trades, Portfolio) recently released its 13F portfolio updates for the fourth quarter of 2021, which ended on Dec. 31.
The fund operates under the umbrella of Royce Investment Partners, the firm founded by Chuck Royce (Trades, Portfolio) in 1972. It aims to build a portfolio of high-quality, world-class, non-U.S. small-cap businesses that are a-cyclical growers, can generate plenty of free cash and have a “genuine and defensible” moat. The portfolio is managed by Mark Rayner and Mark Fischer.
Based on the fund's latest 13F, its top buys for the quarter were Asseco Poland SA (WAR:ACP, Financial) and GVS SpA (MIL:GVS, Financial), while its biggest sells were Intertrust NV (XAMS:INTER, Financial) and IMCD NV (XAMS:IMCD, Financial).
Asseco Poland
The fund established a 744,700-share position in Asseco Poland (WAR:ACP, Financial), giving the stock a 1.34% weight in the equity portfolio. During the quarter, shares traded for an average of 91.38 Polish złoty ($22.87) apiece.
Asseco is a Polish computer software company. One of the largest tech companies in Poland, it develops and implements comprehensive and centralized information technology systems for the banking sector in 60 countries worldwide.
On Jan. 21, shares of Asseco traded around 85.60 zloty for a market cap of 7.10 billion zloty. According to the GF Value chart, the stock is fairly valued.
The company has a financial strength rating of 5 out of 10 and a profitability rating of 8 out of 10. While the Altman Z-Score is low at 1.88, the Piotroski F-Score of 8 out of 9 implies a very healthy financial situation. The return on invested capital is higher than the weighted average cost of capital, meaning the company is creating value as it grows.
GVS
The fund increased its GVS (MIL:GVS, Financial) holding by 55.55% for a total of 2,201,212 shares, impacting the equity portfolio by 0.79%. Shares traded around 11.35 euros ($12.88) each in the three months through the end of December.
GVS is an Italian manufacturer and distributer of filters and components for a variety of industries, including health care, life sciences, automotive, appliances, safety and industrial filtration. In addition to pre-made customizable solutions, it also offers tailormade product development services.
On Jan. 21, shares of GVS traded around 10.29 euros for a market cap of 1.80 billion euros. Shares have traded down to about the same price the company went public at in June of 2020.
The company has a financial strength rating of 7 out of 10 and a profitability rating of 4 out of 10. The cash-debt ratio of 12.54 and interest coverage ratio of 48.19 show a fortress-like balance sheet. While the operating margin and net margin are outperforming 94% of industry peers, they are both in decline.
Intertrust
The fund sold all 1,696,595 of its Intertrust (XAMS:INTER, Financial) shares. The stock previously took up 2.11% of the equity portfolio. Shares changed hands for an average price of 16.56 euros during the quarter.
Headquartered in the Netherlands, Intertrust is a group of companies that provides specialized administrative services such as taxes, trust management, business management, outsourcing processes and other fiduciary services.
On Jan. 21, shares of Intertrust traded around 19.42 euros for a market cap of 1.74 billion euros. According to the GF Value chart, the stock is modestly overvalued.
The company has a financial strength rating of 4 out of 10 and a profitability rating of 6 out of 10. The cash-debt ratio of 0.15 and Altman Z-Score of 1.47 show the company might be at some risk of bankruptcy in the next two years. The ROIC is typically higher than the WACC, demonstrating overall profitability.
IMCD
The fund cut its stake in IMCD (XAMS:IMCD, Financial) by 40.27%, leaving a remaining position worth 89,300 shares and reducing the equity portfolio by 0.95%. The stock price averaged 191.94 euros in the three months through the end of December.
IMCD is a Dutch company engaged in the formulation, sale and distribution of specialty chemicals and food ingredients for a variety of businesses, including advanced materials, construction, beauty, pharmaceuticals and more.
On Jan. 21, shares of IMCD traded around 160.85 euros for a market cap of 9.15 billion euros. The Peter Lynch chart shows the stock as trading above both its intrinsic value and its median historical valuation.
The company has a financial strength rating of 6 out of 10 and a profitability rating of 6 out of 10. The Altman Z-Score of 5.69 and Piotroski F-Score of 5 out of 9 show a stable financial situation. The company has a three-year revenue per share growth rate of 12.14% and a three-year Ebitda per share growth rate of 17.4%.
Portfolio overview
As of the quarter’s end, the fund’s equity portfolio consisted of 60 stocks valued at a total of $1.19 billion. The turnover for the period was 10%.
The top holdings were IPH Ltd. (ASX:IPH, Financial) with 3.47% of the equity portfolio, TKC Corp. (TSE:9746, Financial) with 3.04% and Meitec Corp. (TSE:9744, Financial) with 2.92%.
In terms of sector weighting, the firm was most invested in industrials, technology and basic materials.
