Generate Fund Performance - February 2025

International Equities 

Global equity markets had a muted month overall in February, falling -0.8% in USD, yet gaining +0.6% in NZD after the Kiwi dollar softened. There was significant dispersion under the surface, however, with European stocks continuing their strong performance of late, rising +4.6% in NZD terms, while US-listed semiconductor companies declined -3.1% and US smaller companies fell -4.0% (both in NZD).

Our best performers in the month were Alibaba (+34.1%) driven by a combination of strong financial results and the ongoing execution of a significant share buyback program, and Eli Lilly (+13.7%), as investors were reassured about consumer demand for their anti-obesity drugs. Pinterest (+12.2%), and European payments business Adyen (+10.9%) also had good months after they reported strong earnings.

Our weakest performer was a new position in e.l.f. Beauty that fell -29.7% in February after its earnings failed to meet market expectations. We believe the market reaction overstates the issues at e.l.f. so we increased our position at more attractive prices.

New Zealand & Australian equities

The S&P/NZX 50 decreased by -3.0% in February, reflecting a challenging month across the board. This weak performance can be explained by an underwhelming earnings season, and comments made by CEOs confirming that the domestic economy has been tough for businesses.

The worst performing domestic company in the Funds was Ryman Healthcare, which dropped -23.9% after announcing a surprise $1 billion capital raise. This is the second raise in recent years, as new management battles to turn around the business. We have been sceptics about the company's strategy, and as a result, the Funds had only modest investments in Ryman. The capital raise was executed at an attractive price and removed the balance sheet risk, so the Funds took advantage and increased their holdings.

Spark was another significant underperformer, dropping -22.0% over the month after releasing a weak set of results that were poorly telegraphed to the market. Management argues that they have been reducing costs, and this will be evident in the second half results, leading to an improvement in financial performance.

The strongest performing domestic company was A2 Milk, which was up an impressive +37.3%. A2’s Chinese infant formula business performed better than expectations, allowing the company to raise guidance.

Fletcher Building also had a strong month, appreciating +18.5%; the company released first half results that were better than feared and published guidance that implied analysts were too conservative for the full year.

Returns to the 28th of February 2025 

(after fees* and before tax) 

Generate KiwiSaver Funds:

Generate Managed Funds:

** The Generate KiwiSaver Scheme funds opened on 16 April 2013. The Generate Focused Growth Trust opened on 1 November 2019.

***Following the launch of new funds in May 2022, our original Conservative Fund was renamed as the Moderate Fund and the Focused Growth Trust has been renamed as the Focused Growth Managed Fund.

^ these funds were established on 16 May 2022

^^ these funds were established on 3 July 2023

Past performance is not necessarily an indicator of future performance.

Generate’s fund updates can be found here for KiwiSaver Funds and here for Managed Funds.

Top Holdings as of the 28th of February 2025

Generate total Funds Under Management (FUM) as of 28th of February 2025: $6,918,736,203