Ceased Coverage on McMillan Shakespeare

As foreshadowed in our note on April 2, 2020, we cease coverage on McMillan Shakespeare. We periodically adjust our coverage as necessary based on stock outlook, client demand and investor interest. The largest near-term risk is an economic downturn which will see higher unemployment and a recession, reducing demand for salary packaging and novated leases for new case. Another uncertainty is with potential changes to current fringe benefits tax, or FBT, concessions, which could be revisited in the future in the face of federal budget deficits. Potential major changes to the FBT regime could compromise the high growth and returns historically achieved by McMillan.