The New Zealand Growth Fund returned +5.4% in May, compared to its benchmark of +4.3%. 

Mainfreight (+27%) reported its full year result slightly better than expected, having earlier in the month provided a trading update suggesting it would beat expectations. The result included a mix of performances by region and product, reflecting diverging market conditions. However, the general tone was relatively positive, despite remaining cautious due to subdued economic activity in some regions, such as New Zealand, and the ongoing uncertainty in freight markets as a result of tariffs. Australia remains the key growth driver with robust +7% growth in profit before tax. Air & Ocean freight forwarding has seen limited impact of tariffs other than the China-US route, which is only around 10% of that business unit. Warehousing across the board demonstrated continued growth and is poised to benefit from reduced costs as non-core leased facilities are exited in the new financial year. Transport in the US remains the key area where management are unhappy with progress. It feels that management are increasingly confident about the environment being conducive enough to resume its growth trajectory after a challenging couple of years. 

Serko (-17%) released a complex result, which included the first contribution from its January acquisition of GetThere (a business travel online booking tool). The pre-acquisition business delivered solid performance including strong underlying growth from its Booking for Business joint venture and sound cost control, that would have delivered on its objective of transitioning to free cash flow. However, barely months after the transaction, GetThere took the shine off what would have been a solid result. Its revenue outlook is meaningfully less than previously expected, by around 20-30%, due to lower corporate travel intentions, driven by US government belt-tightening and tariff-related uncertainty. Accordingly, revenue guidance of $115-123m was below market expectations. We think that the Booking for Business opportunity is developing as expected and look forward to seeing progress and growth in the next year.