The New Zealand Superannuation Fund continued its run of
impressive returns, reporting a record 25.8% return in the year
ended June thanks to some astute investing.
The fund, commonly known as the Cullen fund after its
founder, former finance minister Sir Michael Cullen, invests
globally to help pre-fund New Zealanders' universal
The fund is now worth $23 billion compared with $19 billion a
Guardians of New Zealand Superannuation chairman Gavin Walker
said the annual return capped off a successful 12 months for
''While the fund's performance over the 2012-13 year has been
exceptional, it should not be seen as a precursor of ongoing
returns at the same level.''
Chief executive Adrian Orr said the strong performance was
due to a heavy weighting towards growth assets, including
global equities, and from valuation lifts in key domestic
assets Kaingaroa and Z Energy.
The fund recently sold down part of its share in Z Energy,
which it owned with Infratil. Z is now listed on the NZX.
Mr Orr said with the fund not scheduled to pay out money
until 2030, it remained focused on long-term growth-oriented
investment strategies and returns.
''We are prepared to weather the inevitable short-term
volatility and will look to profit from it where we can.''
The fund's previous highest annual return was 25.1% in
2010-11. Since inception in September 2003, the fund had
returned 8.8% a year and was ''comfortably ahead'' of its key
long-term performance benchmarks, Mr Orr said.
Over the time frame, the fund had beaten the 90-day Treasury
bill return by 3.9% a year, or $6 billion, and was ahead of
its passive reference portfolio benchmark by 1.14% a year, or
The guardians expected over the long term the fund would beat
the Treasury bill return by at least 2.5%, by 0.5% a year.
For the 2012-12 year, the fund achieved its strongest annual
results compared with its benchmarks, beating the reference
portfolio by 7.36% and the bill return by 23.43%.
In New Zealand, the fund has stakes listed companies
including Fletcher Building, Telecom, Auckland International
Airport, SkyCity Entertainment, Contact Energy, Fisher and
Paykel Healthcare, NZ Refining Company, Ryman Healthcare,
Trade me and Sky Network Television.
Internationally, it has stakes in Transurban Group, Zurich
Airport, Simon Property Group, Copenhagen Airport, Exxon
Mobile, Samsung Electronics, Mitsubishi Estate, Apple and