Semi-Annual Report (Non-Audited) June 30, 2017

Transcription

1 ERB Funds VCIC PLC An open-ended umbrella variable capital investment company with variable capital and segregated liability between Sub-Funds, incorporated with limited liability under the Laws of Cyprus with registered number HE and authorisation number UCIT 08/78. Semi-Annual Report (Non-Audited) June 30, 2017 No subscription can be received on the basis of financial reports. Subscriptions are only valid if made on the basis of the current prospectus accompanied by the latest annual report and the most recent semi-annual report, if published thereafter. UNITS DO NOT HAVE A GUARANTEED RETURN AND PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RETURNS

2 Table of Contents Organisational Structure...3 Board of Directors of Company and Management Company...4 Statement of Assets Liabilities as of June 30, Table of investments...6 Statement of Assets changes as of June 30, Income Statement until June 30, Notes on the Financial Statements of June 30,

3 ERB Funds VCIC PLC Organisational Structure Company ERB Funds VCIC PLC 41 Arch. Makarios III Avenue 1065 Nicosia Cyprus Management Company Eurobank Asset Management Mutual Fund Management Company S.A. 10 Stadiou Street Athens Greece Depositary, Distributor and Transfer Agent Eurobank Cyprus Ltd 41 Arch. Makarios III Avenue 1065 Nicosia Cyprus Administrator Eurobank Ergasias S.A. 8 Iolkou & Filikis Etaireias Athens Greece Auditors PricewaterhouseCoopers Ltd PwC Central, 43 Demostheni Severi Avenue 1080 Nicosia Cyprus Company Secretary Andreas Petasis 41 Arch. Makarios III Avenue 1065 Nicosia Cyprus 3

4 Board of Directors of the Company The Board of Directors of the ERB Funds VCIC PLC consists of five (5) Directors, three (3) of which are independent. The Board of Directors of the Company is as follows: ñ Konstantia Konstantinou ñ Emilia Zachariou ñ Eleni Stavrou Costea ñ George Drousiotis ñ Simos Hamboulas Non-Executive Non-Executive Independent, Non-Executive Independent, Non-Executive Independent, Non-Executive Board of Directors of the Management Company The Management Company s Board of Directors consists of the following members: ñ Dimosthenis Arhodidis ñ Theofanis Mylonas ñ Eleni Koritsa ñ Giorgos Vareltzidis ñ Iacovos Giannaklis ñ Anastassios Ioannidis ñ John Synodinos ñ Konstantinos Tsiveriotis ñ Alexandros Tsourinakis ñ Dimitrios Thomakos ñ Andreas Zombanakis President Vice-president and Chief Executive Officer Deputy Chief Executive Officer Member Member Member Member Member Member Independent Member according to the provision and criteria of the Commission Delegated Regulation (EU) 2016/438 Independent Member according to the provision and criteria of the Commission Delegated Regulation (EU) 2016/438 4

5 Assets - Liabilities statement as of June 30, 2017 ERB VCIC ERB VCIC ERB VCIC ERB Short ERB Short Consolidated Duration EUR Duration USD Currency EUR EUR USD Assets Securities portfolio at market value , , ,00 Cash at bank , , ,88 Receivable on interest and dividends 6.129, , ,05 Other Assets 933,57 488,89 507,47 Total Assets , , ,40 Liabilities Payments and other liabilities 668,02 343,53 370,31 Forward foreign exchange contracts , ,60 Total liabilities , ,13 370,31 Total Net Assets , , ,09 Information for the total number of active units and net value per unit Active units on 30/06/ , , ,000 Net asset value per unit 10, ,0308 Historical table Total assets as of 30/06/ , ,09 Net unit price as of 30/06/ , ,0308 Active units as of 30/06/ , ,000 The accompanying notes form an integral part of these financial statements. 5

6 ERB Funds VCIC PLC Table of investments as of June 30, 2017 ERB short Duration EUR Currency Nominal Description Cost Current % of value Value Value Net Assets Listed Securities Bonds EURO 500 REPUBLIC OF CYPRUS 26/7/2023 3,75 FIXED , ,50 4,36% EURO 500 REPUBLIC OF CYPRUS 27/6/2024 2,75 FIXED , ,50 4,09% EURO 300 CCTS EU 15/12/2020 0,53 FLOATING , ,40 2,43% EURO 1000 BONOS Y OBLIG DEL ESTADO 31/10/2026 1,3 FIXED , ,00 7,90% Total Investments in Bonds , ,40 18,77% Total Investments , ,40 18,77% Change in portfolio composition from 13/03/2017 until 30/06/2017 Bond loans listed in an organised market ,50 100,00% ERB short Duration USD Currency Nominal Description Cost Current % of value Value Value Net Assets Listed Securities Bonds USD 500 BMW US CAPITAL LLC 6/4/2020 1,67917 FLOATING , ,50 5,00% USD 500 NEW YORK LIFE GLOBAL FDG 9/4/2020 1,42761 FLOATING , ,50 4,99% USD 500 PEPSICO INC 2/5/2019 1,20956 FLOATING , ,50 4,98% USD 500 APPLE INC 11/5/2020 1,252 FLOATING , ,00 4,98% USD 750 AMGEN INC 10/5/2019 1,502 FLOATING , ,50 7,50% USD 500 JPMORGAN CHASE & CO 1/6/2021 1,88178 FLOATING , ,50 4,99% USD 400 WALT DISNEY COMPANY/THE 5/6/2020 1,4125 FLOATING , ,60 3,99% USD 450 WESTPAC BANKING CORP 28/6/2022 2,00483 FLOATING , ,90 4,49% USD 500 GENERAL MOTORS FINL CO 13/4/2020 2,08511 FLOATING , ,00 5,01% Total Investments in Bonds , ,00 45,93% Total Investments , ,00 45,93% Change in portfolio composition from 13/03/2017 until 30/06/2017 Bond loans listed in an organised market ,00 100,00% The accompanying notes form an integral part of these financial statements. 6

7 ERB Funds VCIC PLC Changes in assets as of June 30, 2017 ERB VCIC ERB VCIC ERB VCIC ERB Short ERB Short Consolidated Duration EUR Duration USD Currency EUR EUR USD Assets as of March 13, 2017 Increase / decrease of capital for the period , , ,00 Subscriptions , , ,00 Redemptions Net result for the period (Profit / Loss) 2.497,86 439, ,38 Appreciation / Depreciation of investments for the period 4.158, ,90 727,71 Total result for the period (Profit / Loss) 6.656, , ,09 Total Change in Assets , , ,09 Total net assets , , ,09 Active units Active units as of 13/03/2017 Active units as of 30/06/ , ,000 Total Appreciation / Depreciation 3.520,90 727,71 7

8 ERB Funds VCIC PLC Income Statement period ending June 30, 2017 ERB VCIC ERB VCIC ERB VCIC ERB Short ERB Short Consolidated Duration EUR Duration USD Currency EUR EUR USD Income 4.099, , ,05 Income from bonds coupons and dividends 1.526,98 610, ,34 Income from current accounts 2.572,61 610, ,71 Expenses 1.599,35 781,82 932,96 Custody fees 609,97 251,88 408,65 Fund administration fees 285,86 151,88 152,90 Transfer Agent Fees 50,00 50,00 0,00 Other expenses 567,03 298,10 306,90 Tax on Fund 71,30 14,77 64,51 Other taxes 15,19 15,19 0,00 Result for the period (Revenues - Expenses) 2.500,24 439, ,09 Profit / Loss from transactions (2,37) 0,00 (2,71) Bonds (2,37) 0,00 (2,71) Net Result for the period 2.497,86 439, ,38 Appreciation / Depreciation of investments as of 30/06/ , ,90 727,71 Bonds 4.157, ,90 727,00 Foreign exchange differencies from other currencies 0,62 0,00 0,71 Total result (Profit / Loss) 6.656, , ,09 8

9 Notes on the Financial Statements of June 30, General The Company is a public company limited by shares incorporated in Cyprus on January 31, 2017 under the Companies Law of Cyprus with registration number HE and authorised on August 01, 2016 by the Cyprus and Exchange Commission as a UCITS Variable Capital Investment Company with several investment compartments under the UCI Law under license number UCIT 08/78. The Company has been established for an unlimited period of time. The Company s Memorandum of Association provides that the sole object of the Company is the collective investment in transferable securities and/or other liquid financial assets of capital raised from the public operating on the principle of risk spreading in accordance with the UCI Law. The Company issues Investor Shares. Shares may be designated in one or more Share Classes with reference to one or more Sub-Funds. As at June 30, 2016 the following sub-funds are active: Sub-Fund Lunched date ERB Short Duration EUR Fund March 13,2017 ERB Short Duration USD Fund March 13, Summary of the Basic Accounting Principles The financial statements have been prepared according to the regulations prevailing in the Republic of Cyprus relating to undertakings for collective investment schemes. ) Basis of Presentation of Financial Statements The financial statements of each sub-fund are denominated in the following currencies: Sub-Fund ñ ERB Short Duration EUR Fund ñ ERB Short Duration USD Fund Currency EUR USD The consolidated financial statements of the Company reflecting the assets and liabilities of all sub-funds are expressed in Euro. b) Evaluation of Transferable Securities The value of the assets of each sub-fund shall be determined as follows: (i) (ii) The value of transferable securities and money market instruments listed in a regulated market shall be calculated on the basis of the closing price of stock exchange transactions in cash on the same day. In regulated markets operating outside the European Union, when the valuation on the basis of the price referred to above is not possible due to time differences, the value shall be calculated on the basis of the closing price of such regulated markets on the previous business day. The value of derivative financial instruments listed in a regulated market shall be calculated on the basis of the closing price or, where such price is not determined, on the basis of the price of the last operation published by the stock exchange for same-day transactions. In regulated markets operating outside the European Union, when the valuation on the basis of the price referred to above is not pos- 9

10 sible due to time differences, the value shall be calculated on the basis of the closing price published by such regulated markets on the previous business day. (iii) (iv) If no stock exchange transaction was made on the date of valuation, account shall be taken of the price of the previous day when the regulated market was in session and, if no stock exchange transaction was made on that day either, account shall be taken of the last bid or ask price. If the market, in which the transferable securities and money market instruments are listed, applies the system of single price, such single price shall be taken into account for the determination of their value. In the event that extraordinary circumstances render valuations as aforesaid impracticable or inadequate, the Management Company are authorised, prudently and in good faith, to follow other rules in order to achieve a fair valuation of the assets of the Fund. c) Foreign Exchange Transactions The cost of investments and the transactions during the year/period, expressed in foreign currencies, are converted into the reporting currency of each Sub-Fund at the rate of exchange ruling at the time of the purchase or transaction. The market value of investments and other assets and other liabilities, expressed in foreign currencies, are translated into the reporting currency of each sub-fund at end of period exchange rates. Exchange differences arising on foreign currency translation are offset with profit and losses. The combined statement is calculated at end of period exchange rates. Closing exchange rate as at June 30, 2017 are: ñ 1 USD = EUR d) Interest and Income From Dividends For the calculation of the interest income the accrued interest is taken into consideration after deducting withholding taxes. Dividends are calculated on an ex-dividend basis net from withholding taxes. e) Cash and Time Deposits The following Sub-Funds invest their assets primarily in bank deposits and money market instruments accordingly with their investment objectives. ERB Short Duration Euro Fund Cash accounts and Time Deposits Maturity Range Amounts in EUR EUROBANK CYPRUS - CASH IN EUR Current account ,54 ERB Short Duration USD Fund Cash accounts and Time Deposits Maturity Range Amounts in USD EUROBANK CYPRUS - CASH IN USD Current account ,87 EUROBANK CYPRUS - CASH IN USD Current account 73,01 ING BANK - TIME DEPOSIT 16/3/ /3/ ,00 LANDENSBANK BADEN WUERTTEMBERG - TIME DEPOSIT 16/3/ /3/ ,00 BBVA BANK - TIME DEPOSIT 19/5/ /5/ , ,88 10

11 3. Management Fees The Company pays the Management Company a fee in respect of its duties at an agreed upon percentage of the closing Net Asset Value of each of the Company s sub-funds (plus VAT, if any) as specified in the relevant sub-fund supplements. The Management fee accrues and is reflected in the Net Asset Value calculated on each Valuation Date in relation to each sub-fund and is paid monthly in arrears, in accordance with the provisions set out in the relevant sub-fund s supplement. In addition, the Management Company is entitled to be repaid all of its reasonable out of pocket expenses incurred in the performance of its duties including but not limited to expenses for legal, auditing and consulting services incurred, expenses in the supply of information to shareholders, couriers' fees and other related costs which shall be at normal commercial rates together with VAT, if any, there on. As at June 30, 2017 the following effective rates are applicable per annum: ñ ERB Short Duration EUR Fund 0,00% ñ ERB Short Duration USD Fund 0,00% 4. Compensation of the Depositary As a return for the services provided the Depositary is entitled to receive from the assets of the investment compartments compensation ( Depositary fees ), paid at the end of each month, for the month elapsed, at an annual rate that does not exceed the one mentioned in the Prospectus. This percentage is calculated on a daily basis on the net value of the unit that day for the entire period that the fee is calculated. The Depositary can also receive a compensation that is related to the trades of the fund. 5. Statement of Changes in the Investments Analytical list, per investment compartment, specifying for each investment the total purchases and sales which occurred during the period under review, may be obtained free of charge, upon request, at the Registered Office of the Management Company. 6. Brokerage Commissions and Commissions on Transactions This element refers to the brokerage transaction expenses and the commissions on transactions that relate to securities and derivatives. The amounts that refer to the commissions on transactions appear on the profit and loss statement and the statement of changes in investments, in the category Brokerage commissions and commissions on transactions. 7. Exposure Calculation and Risk Limits Both sub-funds, being newly formed, made use of the right to deviate from their investment limits as permitted by article 49, paragraph 2 of law 78 (I) 2012 that permits deviations in investment limits for a period of six months since the day of licencing. 11

12 Investment Breach on June 30, 2017: ñ ERB Short Duration EUR: o 88,966% exposure in deposits on the same body (limit range 0%-20%) o 18,771% invested in bonds (prospectus limits range 55%-90%) o 88,966% invested in deposits (prospectus limits range 10%-45%) ñ ERB Short Duration USD: o 45,931% invested in bonds (prospectus limits range 55%-90%) o 51,397% invested in deposits (prospectus limits range 10%-45%) Value at Risk The 1-month Historical VaR at 99% confidence interval is: ñ ERB Short Duration EUR: 0,48% ñ ERB Short Duration USD: 0,55% Standard Deviation The annualised standard deviation is: ñ ERB Short Duration EUR: 0,285% ñ ERB Short Duration USD: 0,097% 8. Taxation a) Corporate Income Tax Corporate Income tax for Cyprus tax resident Companies is currently imposed at the rate of 12.5% on income accruing or arising both from sources in and outside Cyprus. For calculating the taxable income, deductions and exemptions must be taken into consideration. More specifically, all relevant expenses incurred wholly and exclusively for the production of that taxable income (e.g. management fees, performance fees, Depositary fees) are deductible expenses whereas dividends, capital gains or profit from the disposal of shares, bonds and other qualifying titles, constitute tax exempt income. Expenses that directly or indirectly relate to tax exempt income are not tax deductible. Where a loss arises during a year of assessment which, if a gain or profit would have been chargeable to tax, it can be set off against current year profits and any excess can be carried forward for a period of five years from the tax year in which the loss has incurred. b) Capital Gains Tax According to the Capital Gains Tax legislation, Capital Gains Tax is imposed at the flat rate of 20%, on gains from disposal of immovable property situated in Cyprus including shares of companies not listed on a recognized Stock Exchange which own immovable property situated in Cyprus, at the rate of 20%. c) Dividend Income Dividend income is unconditionally exempt from income tax. Dividends will be exempt from Special Defence Contribution ("SDC") in Cyprus, unless both conditions below are met: i) The non-resident company paying the dividend engages directly or indirectly more than 50% in activities leading to investment income; and ii) The foreign tax burden on the income of the dividend paying company is substantially lower (i.e. less than 6.25%) than the tax burden of the Cyprus tax resident company or the non-resident company. In the event that the participation exemption does not apply, foreign dividends will be subject to SDC at 17%. If the foreign dividend is subject to SDC in Cyprus, tax credit for foreign Withholding Tax ("WHT") may be available. Relevant supporting documentation is necessary. Dividends distributed to a Cyprus tax resident company indirectly after the lapse of 4 years from the end of the year that the profits were generated are subject to 17% SDC. 12

13 Deemed dividend distribution: A Cyprus tax resident company will be deemed to have made a distribution of 70% of its accounting profits after taxation in the form of dividends at the end of the two years from the end of the tax year to which the profits relate and must account for 17% SDC thereon, however, in the case of UCITS the rate is reduced to 3% to the extent that immediate or ultimate shareholders are Cyprus domicile and tax resident individuals. Any dividends paid out of the particular year will reduce the amount of profits that will be subject to the deemed dividend distribution. d) Interest Income According to the applicable Cyprus Taxation laws, interest that is received by open or close -ended collective investment schemes, is not considered interest for defence contribution purposes, but it is subject to corporate income tax in Cyprus at the rate of 12,5% after the deduction of tax deductible expenses. e) Withholding Tax and Double Tax Relief No Cypriot withholding taxes exist for dividend or interest payments that are made to beneficiaries non-tax residents of Cyprus (companies or individuals). f) Stamp Duty The establishments of the Company and the subscription, redemption, conversion or transfer of its units are exempt from stamp duty. 9. Events that Followed The following events took place after June 30, 2017 and until the day this report was prepared. (a) (b) For ERB Short Duration EUR Fund the percentage of management fees was 0% from the beginning until July 12, The applicable fee is equal to 0.25% from July 13, For ERB Short Duration USD Fund the percentage of management fees was 0% from the beginning until July 12, The applicable fee is equal to 0.25% from July 13, The Company UNITS DO NOT HAVE A GUARANTEED RETURN AND PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RETURNS 13

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