Monthly report May 2026

Performance

Adrigo Small & Midcap L/S Class A and Class C Adrigo Small & Midcap L/S Class A and Class C declined by 2.5% in May, net of fees. Carnegie Small Cap Return Index Nordic rose 3.2% during the month, while Carnegie Small Cap Sweden advanced 4.1%.

Among the fund’s larger holdings, Hansa Biopharma (pharmaceuticals) and Nobia (consumer discretionary) were among the strongest contributors. Among the fund’s small- and mid-sized positions, BHG Group (e-commerce), Rugvista (e-commerce) and Paxman (medical technology) also contributed positively. The fund’s short positions, taken as a group, had a negative impact on performance. The fund’s two largest holdings accounted for more than the fund’s total negative return during the month.

Adrigo Small & Midcap L/S Class A has, since inception and after fees returned 9.8%. Over the same period, the reference rate STIBOR 1M has returned 10.5%, while the Carnegie Small Cap Return Index Nordic (not the Fund’s benchmark index) has returned 118.9%.

Market overview

Global equity markets were generally strong during May. Japan’s Nikkei Index rose 11.9%, MSCI Emerging Markets gained 9.7%, and MSCI World advanced 4.8%. Performance in Korea was once again exceptional, with the market rising 37.5%. The S&P 500 gained 5.3%, while the Euro Stoxx 50 advanced 3.9%.

In the Nordic region, Denmark was the best-performing market, rising 3.7%. Finland and Sweden gained 3.1% and 3.0%, respectively, while Norway declined 0.1%. Swedish small caps outperformed large caps; the Carnegie Small Cap Return Sweden Index rose 4.1%, compared with a gain of 2.8% for the OMXS30 Index.

Companies and performance highlights

The fund initiated several new investments during the month, with a focus on quality and liquidity. Investor interest in smaller small-cap companies has been notably weak in recent years, which has weighed heavily on returns. While we recognise that change within companies takes time to materialise, we must also acknowledge that we have been overly optimistic regarding the time horizon for some of our larger holdings, such as Online Brands and Initiator Pharma. 

Karnell is one of the Fund’s new positions. The company was listed just over two years ago and has delivered strong performance since then. Karnell is an industrial group operating within the serial acquirer segment, but with a clear focus on niche industrial businesses. Its ownership horizon is perpetual. Revenue is relatively evenly split between product companies and niche manufacturing operations. Finland was the company’s largest market last year, accounting for just under 50% of sales, followed by Sweden at 24%.

The company has achieved an impressive margin expansion over recent years, while its low leverage provides ample capacity for additional acquisitions. Notably, Karnell established a presence in Italy in March through the acquisition of OBA Tradizione Futura S.R.L. The company is a Tier 1 supplier to the automotive industry and demonstrates strong profitability. The Italian market is particularly attractive, given its large number of family-owned niche manufacturing businesses facing generational transitions. We have followed Karnell since its IPO and continue to be impressed by the capabilities of both management and the board.

We also reinvested in Camurus. The share price has performed weakly over the past two years, and we believe the valuation is now clearly attractive. The market has evidently been disappointed by the sales development of Buvidal/Brixadi, the company’s treatment for opioid dependence.

During the fourth quarter of 2025, Camurus implemented a change to its distribution model in the UK. This negatively affected reported sales during both the fourth quarter and the first quarter of this year. In addition, patient uptake in the UK has been constrained by funding limitations. However, this should begin to improve during the current quarter, following the approval of a three-year funding program in the NHS budget year that commenced on 1 April. Approximately 73,000 patients were being treated with the product at quarter-end, and the company’s target of 100,000 patients on treatment by the end of 2027 remains unchanged.
Camurus now faces several potentially transformative months. The FDA’s decision not to approve Oclaiz (for the treatment of acromegaly) on 10 June was disappointing. The FDA has previously raised concerns regarding deficiencies at the contract manufacturer. These issues have been addressed, but notably the agency has yet to conduct an inspection of the facility. The FDA now states that such an inspection is required. This is likely to delay the launch by several months, but it does not affect Camurus’ full-year guidance. The product was launched in Germany at the end of 2025 and has since continued its rollout across other European markets.

Furthermore, the pivotal Phase III SORENTO trial for CAM2029 is expected to be completed during the second half of the year. The study targets patients with gastroenteropancreatic neuroendocrine tumors (GEP-NET), a market with potential exceeding USD 2 billion. Finally, we note that Eli Lilly and Camurus have expanded their collaboration in obesity treatment to include amylin-based therapies. At approximately 11.7x estimated 2027 EBITA, Camurus is, in our view, still being valued as a single-product company, without reflecting the substantial potential of its development pipeline.

Finally, as always, we would like to thank you, our co-investors for your trust. Please do not hesitate to contact us with any comments or questions.