Established in 2001

FlagshipAsset Management

Established in 2001 and 100% owned by staff and directors, Flagship Asset Management is a specialist global boutique asset manager.

The company is registered with the FSCA in South Africa as both a fund manager and discretionary financial services provider (under licence number 577).

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Please note that all Flagship employees are working remotely during the Covid-19 lockdown.

Should you need to contact us, please use the following contact details:

[email protected]

or the following people during office hours:

Candice Scholtz [email protected] (083 317 6258)
Gabi Hough [email protected] (083 356 0108)
Simon Hudson [email protected] (083 287 6346)

Fund managers

Paul Floquet [email protected]
Pieter Hundersmarck [email protected]
Kyle Wales [email protected]

Coronavirus Update

24th March 2020

Economic impact of the Coronavirus

The spread of the Coronavirus and the containment efforts being put in place continue to impact global economic activity in the month of March.

The quarantine (or ‘lockdown’) procedures being implemented throughout Europe and the United States (and now in South Africa) are expected to continue into April, and will deeply impact supply chains, consumer and business demand, as well as stock markets. We expect that this will lead to a contraction in GDP for the first quarter of 2020, and perhaps the second quarter as well.

As you can imagine, there is virtually no business untouched by the contagion. Businesses focused on leisure, travel, hospitality and tourism are naturally the most deeply impacted, but a ‘sudden stop’ in economic activity is not something any business can prepare for. Many small businesses will need to close their doors, people will lose jobs, and profits for the 2020 financial year across all economies will be lower than previous years.

The examples provided to us from Asian countries, as well as certain pockets of Europe and the US, show us that the efforts in place by government and civil society will eventually work in curbing the virus.

Wuhan and Italy

Yesterday, Wuhan, the original epicentre of COVID-19, ended quarantine. Transportation will now resume on April 8 and people will be allowed to leave the province. The province of Hubei (in which Wuhan sits) reported zero new infections since March 19, a significant reduction since the height of the epidemic.

As we write, the infection rate in Italy, a country ravaged by their sluggish reaction to the virus, has begun to slow. In the rest of EU5 both France and Germany saw substantial increases in the recovery of patients, which slowed the increase in active patients in both countries which was also positive.

We know that the quarantines will pass. It may take longer than people expect, but history shows us that by this time next year we will be talking a lot less about the virus.


We also know that governments around the world are doing their part to contain the negative economic effects of the lock downs. Many businesses will receive assistance either directly by the government (tax assistance, labour subsidies, furloughs, etc.) or via their balance sheets (debt holidays, relief, and lower interest rates).

From 1929 to 1933, the US economy shrank by one-third, unemployment jumped to 25% and the stock market fell 80%. Poor response by governments and central banks during this time was a leading cause of the depth and duration of the Depression. Lessons from this time have been learned, and were applied during the global financial crisis of 2008 and are being applied to the current crisis.

We also know that some businesses will emerge stronger. For example, the brand building that Dettol, a brand owned by fund holding Reckitt Benckiser, is getting in this environment is tremendous – we’ll be telling our grandkids of how we sanitized with Dettol! Leveraged craft breweries that survived on strong consumer demand will struggle but Heineken will thrive due to its global diversity, and also because their strongest competitor Anheuser Busch-Inbev is being hamstrung by debt. Online Gaming companies will find new customers during this period, and consumer demand for Disney’s new streaming products will grow far faster than previously expected.
It is worth reiterating that stocks are worth owning for the long term. Stocks remain an important part of the world’s long-term savings, and they continue to present the best alternative available to those that want to build wealth. They will continue to look relatively attractive after the crisis.

Flagship’s approach

The Flagship global investment team focusses on allocating investors’ capital to the highest return assets in our mandated universe, without taking undue risk. This has been achieved over 19 years, including periods with heightened market volatility and economic contraction.

The current uncertain environment allows us to deploy this strategy to protect your investments and to position our Funds for growth in the future.

Risk management is not only a consideration during times of stress. It is embedded in the way we build portfolios every day, and is at the forefront of our decision making. We remain diligently focused on the macro environment and your investments, and stand ready to respond to any further developments.

How to contact us during the lockdown

From a business point of view, Flagship will be fully operational during the 21 day lockdown period. All staff will be working remotely from home with effect from Friday 27th March, and have the necessary infrastructure, systems & technology to provide uninterrupted investment management and service to all our investors.

Contact details for any queries or requests should be sent to:

Candice Scholtz (head of Flagship administration)
[email protected]
cell number: 083 317 6258

Gabi Hough (portfolio managers’ assistant)
[email protected]
cell number: 083 356 0108

Simon Hudson (CEO)
[email protected]
cell number: 083 287 6346

Wishing you the very best of health (and patience) over the next few weeks…


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