About HGL

HGL is listed on the Australian Stock Exchange with ASX Code: HNG.  Our market capitalisation is approximately $120 million. 

HGL invests in and develops the potential of small and medium sized businesses. Investment is specialised and currently focussed into enterprises that import branded goods and in funds management businesses.  Currently HGL owns 12 businesses and is a significant shareholder in two funds managers. 

Generally HGL enters into partnerships with the people who run the businesses it invests into.  Through this approach the people running each business have a substantial incentive to ensure their business prospers.  This equity participation philosophy is mirrored at HGL with just under 10% of the capital being held by head office management. 

HGL invests for the long term and does not plan to sell businesses.  HGL assists the people running each business identify and manage risk and plan for management succession.  This approach provides long term security for customers, suppliers and staff. 

HGL is well placed to continue developing its businesses and pursuing further acquisitions. 

If you have a business to sell please contact Paul Rajendran on (02) 9221 7155 or 0409 745 621 or Michael Mahoney or Kevin Eley on (02) 9221 7155.

Investment strategy  

HGL specialises in developing the potential of Australian businesses that import branded goods or are light manufacturers.  With our long term investment strategy we do not tend to sell businesses.  We build businesses for the long term benefit of our shareholders, customers, suppliers, staff and joint venture partners. 

HGL provides the majority of the finance to our businesses and ensures there are proper financial and business processes in place.  We support each Chief Executive in ensuring the business is run in a manner that should lead to increased long term value. We act as a sounding board for the Chief Executives of each business and our involvement is formally through monthly board meetings and informally on a more frequent basis. 

Our businesses recognise the importance of building the value of their brands.  This is achieved through developing a rapport with customers that inspires them to trust and rely on our products, brands and first class service.  All the HGL businesses aim to provide their customers and suppliers with the ability to have trouble free and profitable transactions with their customers every day of the year.  We support this process through encouraging appropriate training, advertising, marketing and promotions. 

HGL builds the Australian sales of brands and tends to enter into medium to long term distribution agreements with suppliers which give the supplier comfort that we are prepared to make a long term commitment to their brand. 

Acquisitions  

When considering new investments HGL will consider businesses we can understand with most of the following characteristics:

  • Expected maintainable future returns in excess of 20% calculated by reference to earnings before interest, tax and goodwill amortisation (EBITA) to capital employed;
  • A track record of robust past profitability;
  • A capable management team; 
  • Diversification across suppliers and/or customers; and
  • Not capital intensive. 

Our way of doing business is to enter into equity partnerships with the people who run the businesses  in which we invest.  This is achieved through either bringing in an equity partner on acquisition or structuring an arrangement that enables us to invite management to become part owners.  Through this approach the people running each business share in the value they help create. 

Generally we find management who are also part owners enhance returns and create structures that build value over the medium to long term through properly managing opportunities and risk.   

The management team of each business, led by its chief executive, are specialists in their market  while HGL contributes wider business experience and a detachment from the day to day operation of the business. 

All businesses within HGL are sales and value focussed organisations.  The aims of all these enterprises are to increase sales and profits while controlling risk and capital employed.  To ensure each business remains focussed on its own goals, each business operates out of its own premises with separate equity ownership. 

To manage succession we strive to develop each business so the current chief executive, if no longer participating in management, would be satisfied to leave a substantial portion of equity invested.  In such a way we develop talent and build security for our joint venture partners, employees, customers and suppliers.  We build businesses for the long term.