Investment update

Club Plus Super’s investment options recorded another year of strong growth in 2017-18, with the MySuper/ Balanced and Pension Balanced option achieving double digit returns.

Gemma Dooley Head of InvestmentsHead of Investments, Gemma Dooley, said members have benefitted from strong global and Australian equity markets, with the ASX 200 reaching its highest mark for a decade.

“Most Club Plus Super members are in the MySuper/Balanced investment option which delivered a net after tax return of 10.82%. Importantly, the MySuper option has delivered consistent year-on-year results averaging 9.37% net after tax growth for the past five years. Pension members also had a positive return. (see below)”

Investment option performance

Investment option2017/18 Financial year return5 years ending 30 June 2018
MySuper/Balanced10.82%9.37%
Pension Balanced11.52%10.45%

For further details on investment option performance please click on the relevant link below:

Gemma said global markets remained volatile, reflecting uncertainty over economic and trade policies in North America, China, and Europe.

“Looking back over the first full financial year of the Trump era, we can see that global markets started strongly off the back of US tax cuts. Momentum then started to slow about midway through the year in the face of inflation and interest rate rises in the US.

Domestically, the residential property sector began to struggle in the second half of the year, however retail and commercial property was quite strong. In a low interest rate and low yield environment, returns from cash and bonds continued to be modest. On the flip side, Australian and international equities, infrastructure and private equity all offered good gains across the year with our investment managers outperforming the markets.

With the global economy likely to remain volatile, Club Plus Super will continue to focus on a diversified investment strategy and engage investment managers that can combine well to deliver solid returns in all market conditions for our members.”

Spotlight on infrastructure investments

Club Plus Super invests in a wide range of Australian infrastructure assets, including investments in the energy, ports and airport sectors.

A sample of Club Plus Super’s infrastructure investments as at 30 June 2018.

Infrastructure investments

The Bald Hills Wind Farm in South Gippsland operates 52 wind turbines and has a total capacity of 106.6MW of energy. The project commenced operations in September 2015 and has a 15-year offtake agreement with Alinta Energy, extending to 2030.

Despite confusion over the direction of Federal Government energy policy, renewable energy generation has continued to grow across Australia. The Victorian Government has committed to Victorian renewable energy generation targets of 25% by 2020 and 40% by 2025. Developments in battery storage and the successful deployment of the world’s largest lithium-ion battery installation in South Australia, have increased confidence in the sector.

Brisbane Airport (BNE) continues to be one of the country’s fastest growing airports, with new flights, new airlines, and more global destinations contributing to a nearly 7% year-on-year growth in international passengers in 2017. Domestic passenger volumes also increased modestly by 0.8% to more than 17.4 million. In total, BNE’s passenger numbers – domestic and international – grew by 2.3% to more than 23.2 million for the calendar year.

The airport’s second runway is set to be completed by 2020, and Qantas’ new Dreamliner 787-900s will commence flights between Brisbane and Los Angeles in September 2018.

The airport is also planning to increase non-aviation revenues, with 500 hectares of development land which is not aviation-based.

NSW Ports manages four major infrastructure assets, including Port Botany, Port Kembla, Enfield Intermodal Logistics Centre, and the Cooks River Intermodal Terminal. The port assets were privatised by the NSW Government in 2013 under 99-year leases.

Port Botany and Port Kembla have national economic significance and are considered crucial to the future economic growth and development of NSW. Port Botany, for example, currently processes 2.4 million containers a year. It is estimated between 7.2 million and 8.4 million containers will pass through the port by 2045. Furthermore, it has been estimated 50% of goods in Sydney households come through Port Botany.

Asset class mix for MySuper/ Balanced and Pension Balanced

‘Asset class’ mix refers to the different categories of investment that make up an investment option. Each asset class generally performs differently in response to various market and economic conditions. Infrastructure makes up 6% of the strategic asset allocation for the MySuper/Balanced and Pension Balanced investment options.

Asset class mix investments

 

Disclaimer: It’s always important to remember that past performance is not necessarily an indicator of future performance. When choosing any investment, you should consider whether it is appropriate for your particular goals, financial situation and needs. One of the most important considerations about ‘risk ‘ relates to how long you are going to be invested for (your ‘time horizon’). If your super is going to be invested for a number of years or even decades, it’s important to stay focused on your long-term strategy rather than short-term performance and if you’re ever in doubt, you should consider professional advice. You can find more information at clubplussuper.com.au/financial-advice.