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 (00:00):
Now, now, with markets as volatile as they are and

(00:02):
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 has deafy here that how are you? I'm
very well, thank you. Now tell me which parts of
the share market have been doing well despite the sell off?

Speaker 2 (00:19):
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

(00:39):
up better areas like utilities and infrastructure as well.

Speaker 1 (00:43):
What is a consumer staples company? I mean do I
do I know any of these companies?

Speaker 2 (00:48):
Yeah? So consumer staples companies are sort of exactly what
they sound like. You know. They're companies that sell core
goods that consumers need and can't really live without. Food diverages,
household products like toilet paper, toothpaste, all companies that provide
an essential service like supermarkets. So one example is a

(01:08):
UK consumer health company called HALion, So you might not
have heard of the company, but I'm pretty sure you'll
know it's products they sell brands like Panadole, Voltaire and
Censordine Centrum as well as manymore.

Speaker 1 (01:22):
Yeah, so why are they doing so well during the volatility?

Speaker 2 (01:26):
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

(01:47):
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 circle of 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

(02:08):
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's sort of stopped that from happening.

Speaker 1 (02:25):
And then how are they going to be impacted by
the tariffs?

Speaker 2 (02:29):
Yeah, so Haleyon is a little bit more protected from
tariff's 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 percent are imported. And it also has
a very high growth margin structure, so that limits the

(02:50):
impact from tariffs a little bit as well. But there,
you know, there are other consumer staples companies that aren't
so lucky. So for example, Remi Quontraro, 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

(03:12):
at risk 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 shehre market this year. It's
down fifteen percent, whereas hally On is up nine percent

(03:34):
in US dollars.

Speaker 1 (03:35):
Yeah, it's really interesting stuff, Steff, thanks for talking through
to appreciated that Stephanie Bachelor milfairset management.

Speaker 2 (03:41):
For more from Heather Duplessy Allen Drive. Listen live to
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