Renaissance Canadian Growth Fund. Annual Management Report of Fund Performance

Transcription

1 Renaissance Canadian Growth Fund Annua Management Report of Fund Performance for the financia year ended August 31, 2017 A figures are reported in Canadian doars uness otherwise noted This annua management report of fund performance contains financia highights but does not contain the compete annua financia statements of the investment fund If you have not received a copy of the annua financia statements with this annua management report of fund performance, you can get a copy of the annua financia statements at your request, and at no cost, by caing us to-free at FUND (3863), by writing to us at Renaissance Investments, 1500 Robert-Bourassa Bouevard, Suite 800, Montrea, QC, H3A 3S6, by visiting the SEDAR website at sedarcom, or by visiting renaissanceinvestmentsca Unithoders may aso contact us using one of these methods to request a copy of the investment fund s proxy voting poicies and procedures, proxy voting discosure record, or quartery portfoio discosure Management Discussion of Fund Performance Investment Objective and Strategies Investment Objective: Renaissance Canadian Growth Fund (the Fund) seeks to achieve ong-term investment returns through capita growth, primariy in equity securities of arge- to medium-sized Canadian issuers Investment Strategies: The Fund invests primariy in issuers isted on the Toronto Stock Exchange and may aso invest in securities of issuers ocated in other countries Issuers wi typicay have an estabished record of earnings, financia strength, good management, and above-average reative growth potentia and wi typicay have a market capitaization of more than $1 biion Risk The Fund is a Canadian equity fund that is suitabe for ong-term investors who can toerate medium investment risk For the period ended August 31, 2017, the Fund s overa eve of risk remains as discussed in the simpified prospectus Resuts of Operations Picton Mahoney Asset Management (Picton Mahoney), Guardian Capita LP (Guardian Capita) and Connor, Cark & Lunn Investment Management Ltd (CC&L) provide investment advice and investment management services to the Fund The investment stye and the percentage of the portfoio aocated to these portfoio sub-advisors are outined beow The portfoio aocation may change from time to time Picton Mahoney: Canadian Equity Growth Momentum, approximatey 50% Guardian Capita: Canadian Equity Growth at Reasonabe Price, approximatey 35% CC&L: Canadian Equity Sma-Mid Cap, approximatey 15% The commentary that foows provides a summary of the resuts of operations for the period ended August 31, 2017 A doar figures are expressed in thousands, uness otherwise indicated The Fund's net asset vaue increased by 9% during the period, from $505,422 as at August 31, 2016 to $548,539 as at August 31, 2017 Net saes of $16,264 and positive investment performance resuted in an overa increase in net asset vaue Cass A units of the Fund posted a return of 32% for the period The Fund s primary benchmark, the S&P/TSX Composite Index (the benchmark), returned 72% for the same period The Fund s return is after the deduction of fees and expenses, unike the benchmark's return See Past Performance for the returns of other casses of units offered by the Fund The overa Canadian equity market rose during the first haf of the period as the goba economy showed signs of a synchronized expansion However, voatie commodity prices, concerns about an infated domestic housing market and US poitica events weighed on investor sentiment ater in the period and increased market voatiity This heightened voatiity resuted in ower market vauations for higher-risk companies Canadian sma-capitaization stocks, as represented by the S&P/TSX Sma Cap Index, returned 22% for the period, underperforming the overa market Canada s economy continued to grow, with strong headine gross domestic product, reported at the end of August, as we as significant job gains, a robust housing market, strong retai saes, and a surge in both imports and exports The Canadian Purchasing Managers Index readings were in the mid-50s, indicating good economic expansion Oi prices were voatie over the period, utimatey rising 57% In ate May, the Organization of the Petroeum Exporting Countries announced that it was extending its output cuts to the end of March 2018 God prices were aso voatie, and rose just 1% over the period The Bank of Canada increased its key benchmark rate by 25 basis points for the first time since 2010, in response to robust economic growth, broady spread across industries Meanwhie, the US Federa Reserve Board raised the federa funds rate three times within six months, despite concerns over weak infation data The Canadian

2 Renaissance Canadian Growth Fund doar appreciated reative to the US doar as a resut of the anticipated narrowing of the interest rate differentia Government of Canada bond yieds moved sharpy higher, and, with the rise in yieds, Canadian fixed income overa saw negative returns Gobay however, government bond yieds generay resumed a downward trajectory, on a combination of sower infation data and geopoitica tensions eading investors to seek safe haven investments, another trend that was negative for growth-oriented securities In the Canadian Equity Growth Momentum component of the Fund, stock seection in the financias sector detracted moderatey from performance, whie stock seection in the utiities sector detracted sighty Sight individua detractors incuded an underweight hoding in Bank of Montrea and an overweight hoding in Seven Generations Energy Ltd Bank of Montrea s execution was weaker than expected, which drove ower earnings forecasts in the US as oan growth forecasts were downgraded and expenses increased Seven Generations suffered from ower energy prices and aso owered its production guidance in the second quarter Stock seection in the materias and industrias sectors contributed moderatey to performance Individua contributors incuded a significant overweight hoding in Veresen Inc and a sight overweight hoding in Lundin Mining Corp Pembina Pipeine Corp offered to purchase Veresen at a significant premium to the share price, which contributed strongy Lundin benefited from genera cycica rotation and from the ray foowing the US eection, which boosted industria metas stocks and contributed moderatey Picton Mahoney added a new hoding in Canadian Natura Resources Ltd on the expectation of progressivey higher free cash fow growth Manuife Financia Corp was added on the expectation of profitabiity and earnings growth improvement, after the company reported investment gains in November 2016 foowing mutipe quarters of osses The component s existing hodings in Veresen and Spin Master Corp were increased Picton Mahoney expects stronger-than-forecasted revenue growth at Spin Master, which offers strong free cash fow generation and a cean baance sheet Picton Mahoney sod the component s hodings in Saputo Inc and Bank of Montrea based on vauations The hoding in ARC Resources Ltd was reduced in order to reduce exposure to energy producers, whie the hoding in Agnico Eage Mines Ltd was decreased in response to the risk of higher capita expenditures for its Meiadine and Amaruq projects In the Canadian Equity Growth at a Reasonabe Price component of the Fund, stock seection among precious metas stocks and in the energy sector, incuding a sight overweight exposure to the exporation and production sub-sector, detracted from performance Significant individua detractors incuded Seven Generations, Tahoe Resources Inc and Cenovus Energy Inc The Guatemaan government temporariy suspended the operating icence for Tahoe s fagship siver mine, which represents approximatey haf the company s net asset vaue Cenovus was negativey affected by weak oi prices and by uncertainty about whether it coud reduce its debt after a major acquisition Tahoe and Cenovus were both sod to remove exposure to these uncertainties Stock seection in the heath care sector contributed to performance Individua contributors incuded Methanex Corp, BRP Inc and West Fraser Timber Co Ltd Methanex benefited from a materia increase in the price of methano, as we as production improvements, an increased share buyback program and a higher dividend BRP reported soid quartery resuts, raised its 2018 guidance, announced a share buyback and introduced a nomina dividend West Fraser aso reported soid quartery resuts, and announced a significant acquisition in the US Guardian Capita added severa new hodings Enbridge Inc was purchased after announcing its merger with Spectra Energy Corp to create North America s argest energy infrastructure company Edorado God Corp was purchased for its aggressive expansion pan through 2020, which shoud significanty increase production and reduce unit operating costs Roya Bank of Canada was added to reduce the component s underweight aocation to banks Encana Corp was added based on forecast production growth of over 15% to 20% in 2017 Doarama Inc is expanding its network and focusing on same-store saes growth Kinaxis Inc offers strong organic growth and recurring revenues Enerpus Corp has a soid three-year growth pan with a focus on higher-margin iquids growth Trican We Service Ltd was added after announcing an acquisition that made it the argest pressure pumping company in Canada Severa hodings were eiminated from the component TransCanada Corp was sod to fund the purchase of Enbridge The pace of acquisitions at Consteation Software Inc is sowing, and the company is experiencing greater competition from private equity firms Guardian Capita beieves growth from restructuring at Mape Leaf Foods Inc has been reaized New God Inc was sod as a resut of increasing risks reated to its Rainy River mine Eement Feet Management Corp no onger meets the Guardian Capita s growth criteria ECN Capita Corp and MEG Energy Corp were sod in favour of other opportunities, and to reduce exposure to oi sands Edorado is subject to increased poitica risk in Greece Guardian Capita is concerned that IMAX Corp faces competition from on-demand movie patforms In the Canadian Equity Sma-Mid Cap component of the Fund, a moderate overweight exposure to the energy sector and a significant underweight exposure to the materias sector, together with stock seection in those sectors, significanty detracted from performance Individua detractors incuded Seven Generations and Raging River Exporation Inc Raging River shares were pressured as investors preferred arger-cap oi stocks An underweight hoding in Ivanhoe Mines Ltd aso detracted after Ivanhoe announced an increased resource estimate Stock seection in the consumer discretionary and financias sectors contributed modesty to the component s performance A significant overweight aocation to the information technoogy sector aso contributed Individua contributors incuded Shopify Inc, Lundin Mining and Capstone Mining Corp Shopify experienced significant 2

3 Renaissance Canadian Growth Fund revenue, whie Capstone benefited from a 49% increase in the copper price CC&L added a new hoding in Hudbay Mineras Inc, which improved its cash fow profie through an acquisition The existing hoding in Spartan Energy Corp was increased as CC&L expects further growth from ow-decine assets and new acquisitions CC&L eiminated the hoding in Osisko God Royaties Ltd because of its uncertain short-term outook The hoding in Eement Feet was reduced foowing its spit into two pubicy traded firms Recent Deveopments Effective Apri 27, 2017, the composition of the Independent Review Committee (IRC) changed Tim Kennish and Wiiam Thornhi resigned as members of the IRC and Susan Sima and Bryan Houston were appointed as members of the IRC Reated Party Transactions CIBC and its affiiates have the foowing roes and responsibiities with respect to the Fund, and receive the fees described beow in connection with their roes and responsibiities Manager, Trustee, and Portfoio Advisor of the Fund CAMI, a whoy-owned subsidiary of CIBC, is the Fund's Manager, Trustee, and Portfoio Advisor CAMI receives management fees with respect to the Fund's day-to-day business and operations, cacuated based on the net asset vaue of each respective cass of units of the Fund as described in Management Fees As Trustee, CAMI hods tite to the Fund's property (cash and securities) on behaf of its unithoders As Portfoio Advisor, CAMI provides, or arranges to provide, investment advice and portfoio management services to the Fund CAMI aso compensates deaers in connection with their marketing activities regarding the Fund From time to time, CAMI may provide seed capita to the Fund Distributor Deaers and other firms se units of the Fund to investors These deaers and other firms incude CIBC s reated deaers such as the CIBC Investor s Edge discount brokerage division of CIBC Investor Services Inc (CIBC ISI), the CIBC Imperia Service division of CIBC ISI, and the CIBC Wood Gundy division of CIBC Word Markets Inc (CIBC WM) CIBC ISI and CIBC WM are whoy-owned subsidiaries of CIBC CAMI may pay saes commissions and traiing commissions to these deaers and firms in connection with the sae of units of the Fund These deaers and other firms may pay a portion of these saes commissions and traiing commissions to their advisors who se units of the Fund to investors Brokerage Arrangements and Soft Doars The Portfoio Advisor makes decisions, incuding the seection of markets and deaers and the negotiation of commissions, with respect to the purchase and sae of portfoio securities, and the execution of portfoio transactions Brokerage business may be aocated by the Portfoio Advisor to CIBC WM and CIBC Word Markets Corp, each a subsidiary of CIBC CIBC WM and CIBC Word Markets Corp may aso earn spreads on the sae of fixed income securities and other securities to the Fund A spread is the difference between the bid and ask prices for a security in the appicabe marketpace, with respect to the execution of portfoio transactions The spread wi differ based upon various factors such as the nature and iquidity of the security Deaers, incuding CIBC WM and CIBC Word Markets Corp, may furnish goods and services, other than order execution, when CAMI processes trades through them (referred to in the industry as soft-doar arrangements) These goods and services are paid for with a portion of brokerage commissions and assist CAMI with investment decision-making services for the Fund or reate directy to the execution of portfoio transactions on behaf of the Fund The fees and spreads for services of the Custodian directy reated to the execution of portfoio transactions by the Fund are paid by CAMI and/or deaer(s) directed by CAMI, up to the amount of the credits generated under soft doar arrangements from trading on behaf of the Fund during that month In addition, the Manager may enter into commission recapture arrangements with certain deaers with respect to the Fund Any commission recaptured wi be paid to the Fund During the period, the Fund did not pay any brokerage commissions or other fees to CIBC WM or CIBC Word Markets Corp Spreads associated with fixed income and other securities are not ascertainabe and, for that reason, cannot be incuded when determining these amounts Fund Transactions The Fund may enter into one or more of the foowing transactions (the Reated Party Transactions) in reiance on the standing instructions issued by the Independent Review Committee (IRC): invest in or hod equity securities of CIBC or issuers reated to a portfoio sub-advisor; invest in or hod non-exchange-traded debt securities of CIBC or an issuer reated to CIBC in a primary offering and in the secondary market; make an investment in the securities of an issuer for which CIBC WM, CIBC Word Markets Corp, or any affiiate of CIBC (a Reated Deaer) acts as an underwriter during the offering of the securities at any time during the 60-day period foowing the competion of the offering of such securities (in the case of a private pacement offering, in accordance with the exemptive reief order granted by the Canadian securities reguatory authorities and in accordance with the poicies and procedures reating to such investment); purchase equity or debt securities from or se them to a Reated Deaer, where it is acting as principa; and purchase securities from or se securities to another investment fund or a managed account managed by the Manager or an affiiate of the Manager 3

4 Renaissance Canadian Growth Fund At east annuay, the IRC reviews the Reated Party Transactions for which they have issued standing instructions The IRC is required to advise the Canadian securities reguatory authorities, after a matter has been referred to or reported to it by the Manager, if it determines that an investment decision was not made in accordance with conditions imposed by securities egisation or the IRC in any Reated Party Transactions requiring its approva Custodian CIBC Meon Trust Company is the custodian of the Fund (the Custodian) The Custodian hods a cash and securities for the Fund and ensures that those assets are kept separate from any other cash or securities that the custodian might be hoding The Custodian aso provides other services to the Fund incuding record-keeping and processing of foreign exchange transactions The fees and spreads for services of the Custodian directy reated to the execution of portfoio transactions by the Fund are paid by CAMI and/or deaer(s) directed by CAMI, up to the amount of the credits generated under soft doar arrangements from trading on behaf of the Fund during that month A other fees and spreads for the services of the Custodian are paid by the Manager and charged to the Fund on a recoverabe basis CIBC owns a 50% interest in the Custodian Service Provider CIBC Meon Goba Securities Services Company (CIBC GSS) provides certain services to the Fund, incuding securities ending, fund accounting and reporting, and portfoio vauation Such servicing fees are paid by the Manager and charged to the Fund on a recoverabe basis CIBC indirecty owns a 50% interest in CIBC GSS 4

5 Renaissance Canadian Growth Fund Financia Highights The foowing tabes show seected key financia information about the Fund and are intended to hep you understand the Fund s financia performance for the period ended August 31 The Fund's Net Assets per Unit¹ - Cass A Units Net Assets, beginning of period $ 3377 $ 3165 $ 3652 $ 2886 $ 2546 Increase (decrease) from operations: Tota revenue $ 073 $ 072 $ 074 $ 071 $ 063 Tota expenses (090) (089) (101) (094) (072) Reaized gains (osses) for the period 125 (155) Unreaized gains (osses) for the period (492) Tota increase (decrease) from operations 2 $ 119 $ 183 $ (493) $ 771 $ 345 Distributions: From income (excuding dividends) $ $ $ $ $ From dividends From capita gains Return of capita Tota Distributions 3 $ $ $ $ $ Net Assets, end of period $ 3485 $ 3377 $ 3165 $ 3652 $ This information is derived from the Fund's audited annua financia statements The Fund adopted IFRS on September 1, 2014 Previousy, the Fund prepared its financia statements in accordance with Canadian Generay Accepted Accounting Principes (GAAP) as defined in Part V of the CPA Canada Handbook Under Canadian GAAP, the Fund measured fair vaues of its investments in accordance with CICA Handbook Section 3855 which required the use of bid prices for ong positions and ask prices for short positions As such, the net assets per unit figure presented in the financia statements may differ from the net asset vaue cacuated for fund pricing purposes An expanation of these differences can be found in the notes to the financia statements issued prior to September 1, 2014 Upon adoption of IFRS, the Fund measures the fair vaue of its investments by using the cose market prices, where the cose market price fas within the bid-ask spread As such, the Fund's accounting poicies for measuring the fair vaue of investments in the financia statements are consistent with those used in measuring the net asset vaue for transactions with unithoders Accordingy, the opening net asset figure as at September 1, 2013 refects the adjusted amount in accordance with IFRS A figures presented for periods prior to September 1, 2013 were prepared in accordance with Canadian GAAP 2 Net assets and distributions are based on the actua number of units outstanding at the reevant time The tota increase (decrease) from operations is based on the weighted average number of units outstanding during the period 3 Distributions were paid in cash, reinvested in additiona units of the Fund, or both Ratios and Suppementa Data - Cass A Units Tota Net Asset Vaue (000s) 4 $ 55,996 $ 64,561 $ 72,153 $ 101,075 $ 93,036 Number of Units Outstanding 4 1,606,814 1,911,714 2,279,759 2,767,581 3,224,228 Management Expense Ratio 5 240% 266% 266% 266% 264% Management Expense Ratio before waivers or absorptions 6 247% 281% 274% 289% 294% Trading Expense Ratio 7 018% 021% 031% 017% 022% Portfoio Turnover Rate % 8418% 8507% 5971% 6903% Net Asset Vaue per Unit $ 3485 $ 3377 $ 3165 $ 3652 $ This information is presented as at August 31 of the period(s) shown 5 Management expense ratio is based on the tota expenses of the fund (excuding commissions and other portfoio transaction costs), incurred by or aocated to a cass of units for the period shown, expressed as an annuaized percentage of the daiy average net asset vaue of that cass during the period 6 The decision to waive and/or absorb management fees and operating expenses is at the discretion of the Manager The practice of waiving and/or absorbing management fees and operating expenses may continue indefinitey or may be terminated at any time without notice to unithoders 7 The trading expense ratio represents tota commissions and other portfoio transaction costs before income taxes expressed as an annuaized percentage of the daiy average net asset vaue during the period Spreads associated with fixed income securities trading are not ascertainabe and, for that reason, are not incuded in the trading expense ratio cacuation 8 The portfoio turnover rate indicates how activey the portfoio advisor and/or portfoio sub-advisor manages the portfoio investmentsa portfoio turnover rate of 100% is equivaent to a fund buying and seing a of the securities in its portfoio once in the course of the period The higher a portfoio turnover rate in a period, the greater the trading costs payabe by a fund in the period, and the greater the chance of an investor receiving taxabe capita gains in the year There is not necessariy a reationship between a high turnover rate and the performance of a fund 5

6 Renaissance Canadian Growth Fund The Fund's Net Assets per Unit¹ - Cass F Units Net Assets, beginning of period $ 1368 $ 1273 $ 1445 $ 1124 $ 976 Increase (decrease) from operations: Tota revenue $ 030 $ 029 $ 030 $ 028 $ 024 Tota expenses (018) (016) (019) (016) (011) Reaized gains (osses) for the period 045 (059) Unreaized gains (osses) for the period (205) Tota increase (decrease) from operations 2 $ 058 $ 107 $ (185) $ 322 $ 136 Distributions: From income (excuding dividends) $ $ $ $ $ From dividends From capita gains Return of capita Tota Distributions 3 $ 020 $ 011 $ $ $ Net Assets, end of period $ 1410 $ 1368 $ 1273 $ 1445 $ This information is derived from the Fund's audited annua financia statements The Fund adopted IFRS on September 1, 2014 Previousy, the Fund prepared its financia statements in accordance with Canadian Generay Accepted Accounting Principes (GAAP) as defined in Part V of the CPA Canada Handbook Under Canadian GAAP, the Fund measured fair vaues of its investments in accordance with CICA Handbook Section 3855 which required the use of bid prices for ong positions and ask prices for short positions As such, the net assets per unit figure presented in the financia statements may differ from the net asset vaue cacuated for fund pricing purposes An expanation of these differences can be found in the notes to the financia statements issued prior to September 1, 2014 Upon adoption of IFRS, the Fund measures the fair vaue of its investments by using the cose market prices, where the cose market price fas within the bid-ask spread As such, the Fund's accounting poicies for measuring the fair vaue of investments in the financia statements are consistent with those used in measuring the net asset vaue for transactions with unithoders Accordingy, the opening net asset figure as at September 1, 2013 refects the adjusted amount in accordance with IFRS A figures presented for periods prior to September 1, 2013 were prepared in accordance with Canadian GAAP 2 Net assets and distributions are based on the actua number of units outstanding at the reevant time The tota increase (decrease) from operations is based on the weighted average number of units outstanding during the period 3 Distributions were paid in cash, reinvested in additiona units of the Fund, or both Ratios and Suppementa Data - Cass F Units Tota Net Asset Vaue (000s) 4 $ 1,558 $ 1,006 $ 877 $ 971 $ 660 Number of Units Outstanding 4 110,427 73,575 68,906 67,208 58,705 Management Expense Ratio 5 106% 106% 106% 106% 106% Management Expense Ratio before waivers or absorptions 6 107% 114% 114% 127% 127% Trading Expense Ratio 7 018% 021% 031% 017% 022% Portfoio Turnover Rate % 8418% 8507% 5971% 6903% Net Asset Vaue per Unit $ 1410 $ 1368 $ 1273 $ 1445 $ This information is presented as at August 31 of the period(s) shown 5 Management expense ratio is based on the tota expenses of the fund (excuding commissions and other portfoio transaction costs), incurred by or aocated to a cass of units for the period shown, expressed as an annuaized percentage of the daiy average net asset vaue of that cass during the period 6 The decision to waive and/or absorb management fees and operating expenses is at the discretion of the Manager The practice of waiving and/or absorbing management fees and operating expenses may continue indefinitey or may be terminated at any time without notice to unithoders 7 The trading expense ratio represents tota commissions and other portfoio transaction costs before income taxes expressed as an annuaized percentage of the daiy average net asset vaue during the period Spreads associated with fixed income securities trading are not ascertainabe and, for that reason, are not incuded in the trading expense ratio cacuation 8 The portfoio turnover rate indicates how activey the portfoio advisor and/or portfoio sub-advisor manages the portfoio investmentsa portfoio turnover rate of 100% is equivaent to a fund buying and seing a of the securities in its portfoio once in the course of the period The higher a portfoio turnover rate in a period, the greater the trading costs payabe by a fund in the period, and the greater the chance of an investor receiving taxabe capita gains in the year There is not necessariy a reationship between a high turnover rate and the performance of a fund 6

7 Renaissance Canadian Growth Fund The Fund's Net Assets per Unit¹ - Cass O Units Net Assets, beginning of period $ 1531 $ 1424 $ 1600 $ 1230 $ 1057 Increase (decrease) from operations: Tota revenue $ 033 $ 032 $ 033 $ 031 $ 028 Tota expenses (003) (003) (005) (003) Reaized gains (osses) for the period 051 (067) (019) Unreaized gains (osses) for the period (123) Tota increase (decrease) from operations 2 $ 084 $ 144 $ (114) $ 368 $ 122 Distributions: From income (excuding dividends) $ $ $ $ $ From dividends From capita gains Return of capita Tota Distributions 3 $ 033 $ 026 $ $ $ Net Assets, end of period $ 1584 $ 1531 $ 1424 $ 1600 $ This information is derived from the Fund's audited annua financia statements The Fund adopted IFRS on September 1, 2014 Previousy, the Fund prepared its financia statements in accordance with Canadian Generay Accepted Accounting Principes (GAAP) as defined in Part V of the CPA Canada Handbook Under Canadian GAAP, the Fund measured fair vaues of its investments in accordance with CICA Handbook Section 3855 which required the use of bid prices for ong positions and ask prices for short positions As such, the net assets per unit figure presented in the financia statements may differ from the net asset vaue cacuated for fund pricing purposes An expanation of these differences can be found in the notes to the financia statements issued prior to September 1, 2014 Upon adoption of IFRS, the Fund measures the fair vaue of its investments by using the cose market prices, where the cose market price fas within the bid-ask spread As such, the Fund's accounting poicies for measuring the fair vaue of investments in the financia statements are consistent with those used in measuring the net asset vaue for transactions with unithoders Accordingy, the opening net asset figure as at September 1, 2013 refects the adjusted amount in accordance with IFRS A figures presented for periods prior to September 1, 2013 were prepared in accordance with Canadian GAAP 2 Net assets and distributions are based on the actua number of units outstanding at the reevant time The tota increase (decrease) from operations is based on the weighted average number of units outstanding during the period 3 Distributions were paid in cash, reinvested in additiona units of the Fund, or both Ratios and Suppementa Data - Cass O Units Tota Net Asset Vaue (000s) 4 $ 490,985 $ 439,855 $ 385,362 $ 947 $ 687 Number of Units Outstanding 4 30,990,086 28,737,170 27,069,260 59,208 55,872 Management Expense Ratio 5 000% 000% 000% 000% 000% Management Expense Ratio before waivers or absorptions 6 000% 000% 000% 017% 014% Trading Expense Ratio 7 018% 021% 031% 017% 022% Portfoio Turnover Rate % 8418% 8507% 5971% 6903% Net Asset Vaue per Unit $ 1584 $ 1531 $ 1424 $ 1600 $ This information is presented as at August 31 of the period(s) shown 5 Management expense ratio is based on the tota expenses of the fund (excuding commissions and other portfoio transaction costs), incurred by or aocated to a cass of units for the period shown, expressed as an annuaized percentage of the daiy average net asset vaue of that cass during the period 6 The decision to waive and/or absorb management fees and operating expenses is at the discretion of the Manager The practice of waiving and/or absorbing management fees and operating expenses may continue indefinitey or may be terminated at any time without notice to unithoders 7 The trading expense ratio represents tota commissions and other portfoio transaction costs before income taxes expressed as an annuaized percentage of the daiy average net asset vaue during the period Spreads associated with fixed income securities trading are not ascertainabe and, for that reason, are not incuded in the trading expense ratio cacuation 8 The portfoio turnover rate indicates how activey the portfoio advisor and/or portfoio sub-advisor manages the portfoio investmentsa portfoio turnover rate of 100% is equivaent to a fund buying and seing a of the securities in its portfoio once in the course of the period The higher a portfoio turnover rate in a period, the greater the trading costs payabe by a fund in the period, and the greater the chance of an investor receiving taxabe capita gains in the year There is not necessariy a reationship between a high turnover rate and the performance of a fund 7

8 Renaissance Canadian Growth Fund Management Fees The Fund pays CAMI an annua management fee to cover the costs of managing the Fund Management fees are based on the net asset vaue of the Fund and are cacuated daiy and paid monthy Management fees are paid to CAMI in consideration for providing, or arranging for the provision of, management, distribution, and portfoio advisory services Advertising and promotiona expenses, office overhead expenses, and traiing commissions are paid by CAMI out of the management fees received from the Fund The Fund is required to pay appicabe taxes on the management fees paid to CAMI Refer to the simpified prospectus for the annua management fee rate for each cass of units For Cass O units, the management fee is negotiated with and paid by, or as directed by, unithoders or deaers and discretionary managers on behaf of unithoders Such Cass O management fee wi not exceed the Cass A unit management fee rate The foowing tabe shows a breakdown of the services received in consideration of the management fees, as a percentage of the management fees coected from the Fund for the period ended August 31, 2017 These amounts do not incude waived fees or absorbed expenses CassAUnits CassFUnits Saes and traiing commissions paid to deaers 4217% 000% Genera administration, investment advice, and profit 5783% 10000% Past Performance The performance data provided assumes reinvestment of distributions ony and does not take into account saes, redemption, distribution, or other optiona charges payabe by any unithoder that woud have reduced returns Past performance does not necessariy indicate how a fund wi perform in the future The Fund s returns are after the deduction of fees and expenses, and the difference in returns between casses of units is primariy due to differences in the management expense ratio See Financia Highights for the management expense ratio Year-by-Year Returns These bar charts show the annua performance of each cass of units of the Fund for each of the periods shown, and iustrate how the performance has changed from period to period These bar charts show, in percentage terms, how an investment made on September 1 woud have increased or decreased by August 31, uness otherwise indicated Cass A Units 40% 266% 20% 0% 15% 07% 132% 67% 32% -20% -49% -200% -56% -134% -40%

9 x Renaissance Canadian Growth Fund Cass F Units 40% 286% 20% 0% -20% -35% -188% 31% 23% -42% 150% -119% 84% 46% -40% Cass O Units 40% 300% 20% 0% -20% -25% -179% 42% 34% -32% 162% -110% 96% 57% -40% Annua Compound Returns This tabe shows the annua compound return of each cass of units of the Fund for each indicated period ended on August 31, 2017 The annua compound return is aso compared to the Fund s benchmark The Fund s benchmark is the S&P/TSX Composite Index 1 Year 3 Years 5 Years 10 Years* or Since Inception* Inception Date Cass A units 32% -16% 65% 00% October 30, 1985 x S&P/TSX Composite Index 72% 21% 81% 41% Cass F units 46% -01% 81% 16% November 24, 2005 x S&P/TSX Composite Index 72% 21% 81% 41% Cass O units 57% 10% 93% 27% Juy 12, 2005 x S&P/TSX Composite Index 72% 21% 81% 41% * If a cass of units has been outstanding for ess than 10 years, the annua compound return since inception is shown S&P/TSX Composite Index is intended to represent the Canadian equity market and incudes the argest companies isted on the TSX A discussion of the Fund's reative performance compared to its benchmark can be found in Resuts of Operations 9

10 x x Renaissance Canadian Growth Fund Summary of Investment Portfoio (as at August 31, 2017) The summary of investment portfoio may change due to ongoing portfoio transactions of the investment fund A quartery update is avaiabe by visiting renaissanceinvestmentsca The Top Positions tabe shows a fund s 25 argest positions For funds with fewer than 25 positions in tota, a positions are shown Cash and cash equivaents are shown in tota as one position % of Net Asset Portfoio Breakdown Vaue Financias 261 Energy 196 Industrias 139 Materias 136 Consumer Discretionary 85 Information Technoogy 67 Cash & Cash Equivaents 47 Consumer Stapes 22 Other Equities 17 Rea Estate 15 Heath Care 13 Other Assets, ess Liabiities 02 % of Net Asset Top Positions Vaue Toronto-Dominion Bank (The) 55 Bank of Nova Scotia 50 Cash & Cash Equivaents 47 Roya Bank of Canada 43 Enbridge Inc 29 Canadian Natura Resources Ltd 29 Manuife Financia Corp 28 Waste Connections Inc 26 Bank of Montrea 22 Canadian Nationa Raiway Co 20 Canadian Pacific Raiway Ltd 19 Veresen Inc 19 CGI Group Inc, Cass 'A' 19 Brookfied Asset Management Inc, Cass 'A' 18 CCL Industries Inc, Cass 'B' 18 SNC-Lavain Group Inc 16 Open Text Corp 14 Seven Generations Energy Ltd, Cass 'A' 14 Air Canada 11 Canadian Tire Corp Ltd, Cass 'A' 11 Methanex Corp 11 Lundin Mining Corp 11 Great Canadian Gaming Corp 10 Finning Internationa Inc 10 Encana Corp 10 10

11 A note on Forward-ooking Statements The management report of fund performance may contain forward-ooking statements Forward-ooking statements incude statements that are predictive in nature, that depend upon or refer to future events or conditions, or that incude words such as expects, anticipates, intends, pans, beieves, estimates, or other simiar wording In addition, any statements that may be made concerning future performance, strategies, or prospects and possibe future actions taken by the fund, are aso forward-ooking statements Forward-ooking statements are not guarantees of future performance These statements invove known and unknown risks, uncertainties, and other factors that may cause the actua resuts and achievements of the fund to differ materiay from those expressed or impied by such statements Such factors incude, but are not imited to: genera economic, market, and business conditions; fuctuations in securities prices, interest rates, and foreign currency exchange rates; changes in government reguations; and catastrophic events The above ist of important factors that may affect future resuts is not exhaustive Before making any investment decisions, we encourage you to consider these and other factors carefuy CIBC Asset Management Inc does not undertake, and specificay discaims, any obigation to update or revise any forward-ooking statements, whether as a resut of new information, future deveopments, or otherwise prior to the reease of the next management report of fund performance

12 Renaissance Investments 1500 Robert-Bourassa Bouevard, Suite 800 Montrea, Quebec H3A 3S FUND (3863) Website renaissanceinvestmentsca CIBC Asset Management Inc, the manager and trustee of the Renaissance Investments famiy of funds, is a whoy-owned subsidiary of Canadian Imperia Bank of Commerce Pease read the Renaissance Investments famiy of funds and Axiom Portfoios simpified prospectus before investing To obtain a copy of the simpified prospectus, ca FUND (3863), emai us at info@renaissanceinvestmentsca, or ask your advisor Renaissance Investments is offered by and is a registered trademark of CIBC Asset Management Inc 02359E (201708)