Outlook
The recent share price action in one of the fund’s largest holdings, John Wiley & Sons, is instructive of some of the opportunities we see today. The stock has been under pressure due to concerns around U.S. university and NIH funding, exacerbated by a public dispute between the current administration and leading academic institutions. At its low in mid-June, prior to the release of full-year results, Wiley was down 15% year-to-date.
While risks to Wiley’s outlook remain, our analysis – supported by company disclosures and sell-side research – suggests these are more limited than headlines imply and already overly reflected in the share price. For example, JP Morgan estimates that even under a negative scenario, the potential revenue impact would be less than 1%.
Wiley’s results themselves were solid. The core Research Publishing division (academic journals) grew +4% in the final quarter and would have exceeded 6% if not for timing delays in renewals. This year’s subscription renewals point to mid-single digit growth and open access revenues are expanding ~20% annually.[1] Additionally, there remains substantial scope to improve cost efficiency, which could drive meaningful margin expansion.
The result? Wiley’s share price rose +10% on the day of results and were up over 20% in total over two weeks. Despite this rebound, we continue to view the stock as significantly undervalued, offering an 11% free cash flow yield based on our forward estimates.[2]
Periods of weak performance often sow the seeds of future outperformance. By combining deep analysis with behavioural discipline, we aim to capitalise on the valuation dislocations we have identified — backing our process and conviction.
Strategy Update
Activity
We made a new investment in Fielmann Group, received shares in Valterra Platinum following its demerger from Anglo American, and exited our Walt Disney holding in May.
Fielmann Group, a family-controlled company, is the market leader in the German optical retail sector. Over the years, it has expanded across Europe and, more recently, into the United States. Its success is underpinned by a strong customer focus and a compelling value-for-money proposition.
The company leverages scale advantages and vertical integration to maintain price leadership, consistently gaining market share from smaller independents. This strategy has resulted in industry-leading sales per store and operating margins. Long-term tailwinds, such as favourable demographics and the recurring nature of eyeglass purchases (typically every 2–4 years depending on geography[3]), further support the business model.
Currently, the investment case is particularly attractive. Margins have been temporarily depressed due to strategic investments, notably M&A activity to enter the U.S. market, with a focus on the Upper Midwest. In 2024, U.S. EBITDA margins stood at 10%, compared to ~25% expected in Europe.[4] Management is now focused on implementing Fielmann’s best practices to improve operational efficiency. This creates a significant runway for margin expansion. Combined with mid-single-digit same-store sales growth and organic store openings, this can drive double-digit free cash flow compounding. We believe current analyst estimates and its valuation – near 20-year lows on EV multiples[5] – do not fully reflect this potential.
Valterra Platinum, formerly Anglo American Platinum (Amplats), was demerged from its parent company, Anglo American, in June. We increased the fund’s weighting to 1% during a period of share price weakness, as some Anglo shareholders sold off their distributed shares post-demerger.
Over recent years, Valterra has undergone significant restructuring and cost-cutting, emerging as a high-quality, fully integrated PGM (platinum group metals) producer. It owns Tier 1 assets that are large, low-cost, and long-life.
At current commodity prices, 30–40% of the South African PGM industry is cash flow negative[6], suggesting that supply is likely to contract. While the demand outlook remains uncertain, it has shown signs of improvement. (See our Q3 2024 report for a detailed supply-demand analysis.)
We acquired shares below £30 – a material discount to our estimated asset value of at least £55 per share – offering a compelling margin of safety.[7]
Walt Disney reached our estimate of fair value and so we chose to reallocate capital to ideas with better risk-reward.
Performance
The Fund returned +2.0% in June. In comparison, the MSCI ACWI index returned +2.8% and the MSCI ACWI Value +1.9% (all in GBP).[8]
John Wiley & Sons (+12% in GBP) was the largest positive contributor. It released robust full year numbers and pointed to long-term margin improvements and the prospect for new revenue streams relating to licensing its content for AI. Lam Research (+19%) outperformed a generally strong semiconductor sector (SOX index +15%).
The largest negative contributor to relative returns was our zero weight in NVIDIA, which rose +15%.[9] None of our holdings made a material negative contribution[10] on an individual basis.
[1] Source: John Wiley & Sons Q4 2025 release.
[2] Source: River Global Investors.
[3] Source: Fielmann Group IR.
[4] Source: Fielmann Group FY2024 release.
[5] Source: Bloomberg Finance LP.
[6] Source: Barclays.
[7] Source: River Global Investors.
[8] Fund: B share class (GBP), midday to midday pricing. Benchmark: close-of-business to close-of-business pricing. All performance data from Bloomberg Finance LP.
[9] Zero weights in NVIDIA, Meta Platforms, Microsoft, and Broadcom cumulatively cost -0.9% relative performance.
[10] Defined as more than -0.25%.