Stephanie Batchelor: Milford Asset Management expert on the sections of the market that have held up

Despite the negative press and volatile climate, some financial markets have managed to hold up solidly throughout 2025.

The consumer staples industry - food, beverages, household products - and all the brands tied to that sector have managed to stay strong throughout the year.

Milford Asset Management's Stephanie Batchelor explains further.

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Episode Transcript

Speaker 1 (00:09):
You're listening to a podcast from News Talks'd be follow
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Speaker 2 (00:17):
With markets as volatile as they are and with the
headlines so negative, you'd be forgiven for thinking that every
company out there has gone down this year. Not the
case at all. Stephanie Bachelor is from Milford Asset Management Hastaff.

Speaker 3 (00:28):
Hi here that how are you?

Speaker 2 (00:29):
I'm very well, thank you. Now tell me which parts
of the share market have been doing well despite the selloff.

Speaker 3 (00:35):
Yes, So, if we look across the different sectors that
make up the global share market, the best performing one
has been consumer staples. So this sector is up about
ten percent year to date versus the broader global share
market being down about five percent, so it's about a
fifteen percent outperformance. And in other sectors that have held

(00:55):
up better areas like utilities and infrastructure as well.

Speaker 2 (01:00):
What is a consumer staples company? I mean, do I
do I know any of these companies?

Speaker 3 (01:04):
Yeah? So consumer staples companies are sort of exactly what
they're say are like, you know, they're companies that sell
core goods that consumers need and you can't really live
without food. Diverriadges household products like toilet paper, toothpaste, all
companies that provide the essential service like supermarkets. So one
example is a UK consumer health company called Calion. So

(01:28):
you might not have heard of the company, but I'm
pretty sure you'll know it's products. They sell brands like Panadol,
Voltaire and Censordine Centrum as well as many Moore.

Speaker 2 (01:38):
Yeah totally. So why are they doing so well during
the volatility?

Speaker 3 (01:42):
Yeah, So when there's a lot of uncertainty in markets,
investors tend to shift towards consumer staples companies because they
know that they're going to be more resilient during a downturn,
because you know, they're categories that people can't not buy.
And then within consumer staples there are subcategories. So one
of these is consumer health, which HALion falls under, and

(02:03):
these are even more resilient. So they come in just
after pet food in terms of sort of macro resiliency.
So you can think of them like the staple of staples.
And you know it's because when we're sick or thinking
about our health, we become quite loyal to certain brands.
You know, we want to stick with what we know
and trust rather than switching it up. Just to save

(02:25):
a few dollars. And there's also less competition in the space.
So in food and beverage, new competitors are popping up
all the time, and snack foods or energy drinks, but
in consumer health there are a lot of regulatory barriers
to entry. So it sort of stopped that from happening.

Speaker 2 (02:41):
And then how are they going to be impacted by
the tariffs?

Speaker 3 (02:45):
Yeah, so Haleyon is a little bit more protected from
tariff relative to other companies. It's a UK company and
it has about a third of its revenue generated in
the US, but about eighty percent of those products are
produced domestically, so they're not subject to tariffs, and then
the remaining twenty percenter imported. And it also has a
very high growth margin structure, so that limits the impact

(03:07):
from a little bit as well. But there are you know,
there are other consumer staples companies that aren't so lucky.
So for example, Remi Quantro, which sells Cognac and other
spirits from Europe into the US. That's also classed as
a consumer staples company. But because it imports about ninety
percent of its US products, it's a it's at risk

(03:29):
of a big tariff hit, and even more so because
Trump has threatened outsized tariffs of two hundred percent on
European alcohol as a retaliation to their tariff on US whiskey.
So as a result, Remy is actually down more than
the global shre market this year. It's down fifteen percent,
whereas hally On is up nine percent in US dollars.

Speaker 2 (03:52):
Yeah, it's really interesting stuff, Steff. Thanks for talking through
and appreciated that. Stephanie Bachelor milfairset management.

Speaker 1 (03:57):
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