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Liontrust GF SF Pan-European Growth Fund

Q2 2023

Past performance does not predict future returns. You may get back less than you originally invested. Reference to specific securities is not intended as a recommendation to purchase or sell any investment.

The Fund delivered a return of 3.3% over the period in euro terms, versus the MSCI Europe Index’s 2.3% return (which is the comparator benchmark)*.

Across the portfolio, we continue to see strong progress in the underlying fundamentals of our companies. Businesses rarely improve in a linear fashion, and it requires a long-term perspective to separate short-term noise from fundamental changes. Despite the ongoing disruption caused by Covid-19 on demand and supply chains and interest rate shocks, we continue to focus resolutely on long-term progress and the companies that will help deliver positive change. Currently, market prices are not reflecting the growth and strong competitive positioning of our business, but we are excited about the long-term prospects of the Fund given this misappreciation.

We continue to manage our portfolios in alignment with these themes, which themselves sit within three broader categories of Better resource efficiency, Improved health and Greater safety and resilience.

Within Better resource efficiency, the growth of renewables is accelerating for a market that's estimated to be worth half a trillion dollars, while the war in Ukraine has shown how security of supply is another essential attribute of renewable energy.

Under Improved health, there has been dramatic innovation in the development of diagnostic tools to aid early diagnosis, cancer and other diseases through the advances that we've seen in gene sequencing. Finally, within Greater safety and resilience, with water quality making the headlines, our theme around better monitoring of supply chains and quality control is focused on companies which provide equipment and services that undertake the essential analysis of our water, air and food.

All these areas are important to solving key sustainability challenges and should also deliver growth that is relatively independent of overall economic growth. While 2022 was a tumultuous year for almost every asset class, we believe that the foundations for our key themes – Better resource efficiency; Improved health; and Greater safety and resilience – are stronger than ever.

In terms of performance drivers in the equity portfolio, our top performer over the quarter was global life sciences company Abcam. Exposed to our Enabling innovation in healthcare theme, the company reported robust first quarter revenue figures, driven by double-digit growth in Americas and EMEA, while China returned to growth in the high-single digits.

Abcam is focused on identifying, developing and distributing high-quality reagents and tools for its customers. These customers are academic and commercial researchers studying biological pathways, critical for an understanding of disease and the progression of diagnostics and drug discovery. By offering a broad catalogue of high-quality products, combined with excellent customer support, the company aims to be the number one partner for researchers. The quality of the reagents provided should enable quality in research and thus the good progression of scientific breakthroughs.

Private equity company 3i Group was also among the top performers over the quarter after its full year results release in May was received well by the market – reporting net asset value per share that beat average estimates. Exposed to our theme of Increasing financial resilience, 3i’s private equity business delivered a gross investment return of £5.0bn, or 40%, driven primarily by its position in non-food discounter Action, which recorded a very strong performance in FY2023. The strong returns were also aided by contributions from a number of its other portfolio companies operating in the value-for-money and private label, healthcare, industrial technology and business and technology services sectors.

American-Swiss medical device company Alcon, which is held under our Enabling healthier lifestyles theme, was also among the contributors over the quarter. Alcon announced a 7% increase in sales to $2.3 billion for the first quarter of 2023 and also slightly raised its full-year outlook for net sales. It now expects year-on-year growth of between 7% - 9%, compared to its previous forecast of between 6% - 8%.

Having struggled in 2022, we have been pleased with Spotify’s performance year-to-date, with the company continuing to strengthen in the second quarter. We have felt the market has somewhat misunderstood the company, namely around the key metrics that we believe are important for Spotify – specifically, user and subscriber growth. Spotify has been growing these metrics strongly, reporting monthly active user net additions of 26 million in Q1, which was 15 million ahead of guidance. In addition, the company reported that premium subscribers grew 15% year-on-year to 210 million, again above previous guidance. Looking forward, Spotify reported that it sees premium subscribers increasing to 217 million in the second quarter of this year, with monthly active users expected to grow by 15 million to 530 million.

IT consultant Nagarro, which is held under our Improving the resource efficiency of industrial and agricultural processes theme, fell sharply after cutting its estimate for 2023 revenue, not including acquisitions made in 2023, from €1,020 million to around €940 million. Nagarro has seen a sharp slowdown in demand particularly among its clients in the financial sector following the fallout from the collapse of SVB and Credit Suisse earlier in the year.

Shares in bioprocessing equipment and consumables manufacturer Sartorius Stedim fell after lowering its full-year sales guidance, citing longer-than-expected inventory reduction among biopharma customers following the Covid-19 pandemic. Held under our Enabling innovation in healthcare theme, Sartorius Stedim provides all the equipment and consumables used in biologic drug development and manufacturing. Currently around one third of drugs are considered “biologic” including gene and cell therapies, but these therapies are set to dominate the market over the next decade with more effective and targeted treatments. While we are disappointed in the short-term performance, we remain confident in the long-term prospects.

Swedish investment platform Avanza slid on the announcement of Q1 2023 results, with profits missing expectations. The bank, which is exposed to our Saving for the future theme and particularly proactive on sustainable investment and promoting the inclusion of women on its platform, reported that operating income increased by 13% to SEK 868 million. However, net brokerage income decreased over the first quarter due to lower trading activity. We don’t feel these factor show a deterioration of their competitive positioning or the long-term tailwinds to the business.

In terms of portfolio activity, we added contract development and manufacturing organisation Lonza under our Providing affordable healthcare theme. Lonza is a global integrated solutions provider for the healthcare industry, offering outsourcing scale and efficiencies to the pharmaceutical and biotechnology industries in the areas of therapy development and manufacturing.

We also added global information services company Experian under our Increasing financial resilience theme. As the world’s largest consumer credit bureau, Experian plays a critical role financial stability through the provision of transparent and accurate credit information. Experian has also developed a number of free tools on the consumer side of the business aimed at improving financial inclusion and credit scores – Experian Boost and Experian Go – helping people establish a credit identity and improve their score, all free of charge.

We also initiated a position in live event ticketing company CTS Eventim under our Encouraging sustainable leisure theme. The company operates an online booking system that allows event promoters to sell their tickets to millions of fans. As part of our theme, we believe this is socially positive form of consumption.

We exited our positions in Mobico Group (formerly National Express) and Helios Towers. Both businesses have strong thematic growth tailwinds over the long-term but we saw stronger fundamentals and higher risk adjusted returns in other areas of the Fund. Namely, the proceeds were used to fund an increase in our position Puma and initiate our holding in CTS Eventim, which returns to the portfolio. We believe both companies have more resilient balance sheets, strong growth and high returns on incremental capital.

Discrete years' performance*, to previous quarter-end:

Past performance does not predict future returns







Liontrust GF SF Pan-European

Growth Fund A1 Acc






MSCI Europe














Liontrust GF SF Pan-European

Growth Fund A1 Acc






MSCI Europe






FE Analytics, as at 30.06.23, primary share class, in euro terms, total return, net of fees and income reinvested.

Understand common financial words and terms See our glossary

Past performance is not a guide to future performance. The value of an investment and the income generated from it can fall as well as rise and is not guaranteed. You may get back less than you originally invested.

The issue of units/shares in Liontrust Funds may be subject to an initial charge, which will have an impact on the realisable value of the investment, particularly in the short term. Investments should always be considered as long term.

Some of the Funds managed by the Sustainable Future team involve foreign currencies and may be subject to fluctuations in value due to movements in exchange rates. Investment in Funds managed by the Sustainable Future team involves foreign currencies and may be subject to fluctuations in value due to movements in exchange rates. The value of fixed income securities will fall if the issuer is unable to repay its debt or has its credit rating reduced. Generally, the higher the perceived credit risk of the issuer, the higher the rate of interest. Some Funds may invest in derivatives. The use of derivatives may create leverage or gearing. A relatively small movement in the value of a derivative's underlying investment may have a larger impact, positive or negative, on the value of a fund than if the underlying investment was held instead.


This is a marketing communication. Before making an investment, you should read the relevant Prospectus and the Key Investor Information Document (KIID), which provide full product details including investment charges and risks. These documents can be obtained, free of charge, from www.liontrust.co.uk or direct from Liontrust. Always research your own investments. If you are not a professional investor please consult a regulated financial adviser regarding the suitability of such an investment for you and your personal circumstances.

This should not be construed as advice for investment in any product or security mentioned, an offer to buy or sell units/shares of Funds mentioned, or a solicitation to purchase securities in any company or investment product. Examples of stocks are provided for general information only to demonstrate our investment philosophy. The investment being promoted is for units in a fund, not directly in the underlying assets. It contains information and analysis that is believed to be accurate at the time of publication, but is subject to change without notice. Whilst care has been taken in compiling the content of this document, no representation or warranty, express or implied, is made by Liontrust as to its accuracy or completeness, including for external sources (which may have been used) which have not been verified. It should not be copied, forwarded, reproduced, divulged or otherwise distributed in any form whether by way of fax, email, oral or otherwise, in whole or in part without the express and prior written consent of Liontrust.

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