The Australian Growth portfolio returned -3.7% in February, compared with the benchmark index which rose +4.9%.

February heralded the biannual financial reporting season for many companies across the market. While the results of these reports influenced individual share price returns, broader market trends and Artificial Intelligence (“AI”) worries observed in January remained the primary drivers of share price performances across different sectors.

Materials (+9%), buoyed by strong commodity prices, and Financials (+9%) supported by good results from the major banks, were the best performing sectors. In contrast, Healthcare (-13%) and Information Technology (-9%) were the worst performing sectors.

CBA (+19% in A$), NAB (+13%) and ANZ (+9%) were some of our strongest performers following the release of good financial updates. The banks are benefitting from strong credit growth in both housing and business. Deposit growth likewise has been strong, and net interest margins remain healthy. Robust economic growth in Australia has translated into low levels of bad debts which also bolstered profit growth. Although bank valuations remain elevated, the strong current domestic backdrop is supportive for their near-term earnings.

February was a tough month for software because of AI disruption fears, including Atlassian (-36%), our worst performing position from a share price perspective. Operationally, Atlassian is performing well. It had another outstanding quarter growing revenue +23% and its forward order book accelerated even more, growing +44%. Atlassian continues to see rapid take up of its AI products with over 5 million monthly active users. In 2025 Atlassian repackaged its products and bundled its Jira, Confluence, Loom and Rovo AI Agents into its Teamwork Collection. This serves as its primary AI monetisation channel, and this passed 1m in paid seats in the quarter. It has expanded seat count by 10%+ over the standalone app footprint. The strong result saw Atlassian upgrade guidance for the 6th quarter in a row.