The New Zealand Growth Fund returned -2.4% for February, compared to its benchmark of -3.0%. Key performers were a2 Milk (+37%) and Vista (+18%) after releasing strong results during the month.

a2 Milk saw its English Label infant formula product grow sales +13% on last year and has been performing strongly as it is at an affordable price point at a time when Chinese families are under economic pressure and looking for quality affordable options. The company surprised on the upside in sales from most of its non-infant formula products. The company is well placed to continue its sales momentum with the launch of premium ('Genesis') and budget ('Gentle Gold') English Label alternatives, plus senior health fortified milk products. Costs were well controlled, and profits came in ahead of expectations. Guidance for the remainder of the financial year was also lifted for both revenue and earnings lines, which reflects management's confidence in the outlook. The maiden dividend was a cherry on the top of a strong result.

Cinema software company Vista was a case of saving the best 'til last, with the company releasing a strong result on the last day of reporting season. Revenue came in marginally ahead of expectations, but the highlight was cost controls which boosted profitability. This saw the company deliver profit well ahead of expectations, with profit margin of 14.4% coming in above the top end of the company's 13-14% guidance. The big positive was the company having the confidence to increase its long-term profit margin aspiration to within the range of 33-37%, from its previous 25-30%. The fact it has recently over-achieved on its guidance adds to the credibility of these aspirations. It is clear the company is in a sweet spot where it is seeing customers progress through its sales 'funnel' and adopt its new products which de-risks its growth trajectory.

Key detractors from returns were Ryman (-9%), which surprised by raising $1 billion from issuing new shares to investors to reduce debt levels, and Fisher & Paykel Healthcare (-9.4%) which will potentially see earnings impacted under the proposed US tariffs on imports from its factory in Mexico.