FAR EAST UNIT TRUST FOR THE PERIOD ENDING 30 SEPTEMBER 2016

Transcription

1 FAR EAST UNIT TRUST FOR THE PERIOD ENDING 30 SEPTEMBER 2016

2 Manager St. James's Place Unit Trust Group Limited PO Box 9034, Chelmsford, CM99 2XA United Kingdom Freephone: (Authorised and regulated by the Financial Conduct Authority) Directors of the Manager D. C. Bellamy A. M. Croft I. S. Gascoigne D. J. Lamb Investment Adviser Aberdeen Asset Managers Limited 10 Queen Street Aberdeen, AB10 1YG United Kingdom (Authorised and regulated by the Financial Conduct Authority) Trustee BNY Mellon Trust & Depositary (UK) Limited 160 Queen Victoria Street London, EC4V 4LA United Kingdom (Authorised and regulated by the Financial Conduct Authority) Registrar International Financial Data Services (UK) Limited IFDS House St. Nicholas Lane Basildon, SS15 5FS United Kingdom (Authorised and regulated by the Financial Conduct Authority) Independent Auditor PricewaterhouseCoopers LLP Atria One 144 Morrison Street Edinburgh, EH3 8EX United Kingdom Prospectus and Manager's Reports Copies of the up to date Prospectus (Scheme Particulars) and latest Manager's Report and Financial Statements for the range of St. James's Place Unit Trusts can be requested from a member of the St. James's Place Partnership or, at any time during normal business hours, from the Administration Centre at PO Box 9034, Chelmsford CM99 2XA. Freephone:

3 Report of the Manager The Report of the Manager consists of The Trust, Investment Objectives & Policy, The Trust's Performance, Risk and Reward Profile, Investment Adviser's Comments and Portfolio Statement. The Trust is an authorised Unit Trust scheme under section 243 of the Financial Services and Markets Act (2000) and is constituted by a Trust Deed dated 6 December The Unit Trust is subject to the rules of the Financial Conduct Authority's Collective Investment Scheme Sourcebook and is classified as a UCITS Scheme. With effect from 10 October 2016, the name of the Scheme has been changed to the St. James's Place Asia Pacific Unit Trust. Investment Objectives & Policy The aim of the Scheme is capital growth from investment principally in the stock markets of Japan, the Far East and the Pacific Basin, which may include investments that are listed, registered or trading within this area. The Scheme is permitted to invest in derivative and forward transactions for the purposes of efficient portfolio management (including hedging). Please note that the investment objectives of the Scheme were amended by an EGM of Unitholders on 21 September With effect from 10 October 2016, the investment objectives are now as follows: The investment objective of the Scheme is to achieve long-term capital appreciation. The Scheme aims to achieve this objective by predominantly investing into the equities of companies exposed to the Asia Pacific. This includes companies based outside of the region who derive an economic benefit from countries in the Asia Pacific. The Scheme is intended to be invested with only limited or no exposure to equities issued by companies in Japan. The Scheme is also permitted to invest in other types of transferable securities, units and/or shares in collective investment schemes, money market instruments and deposits. The Scheme is permitted to invest in derivatives for investment purposes (although it is anticipated this will be limited and/or infrequent use) and for the purposes of efficient portfolio management (including hedging). It is the Manager's intention that the assets of the Unit Trust will be invested so that the Unit Trust will be eligible for inclusion in an ISA. The Trust's Performance The performance of the Trust since its launch in January 1992, over the five year period since September 2011 and over the period under review is shown below, together with figures for the most commonly quoted indices in comparable markets where the major proportion of the Trust has been invested. Class Income units (offer to offer) Class Accumulation units (offer to offer) Indices - actual MSCI AC Asia Pacific (Total Return) Source: Lipper for Fund returns 01/01/92 to 30/09/11 to 31/03/16 to 30/09/16 30/09/16 30/09/16 % change % change % change REMEMBER THAT THE PRICE OF UNITS AND REVENUE FROM THEM MAY GO DOWN AS WELL AS UP. PLEASE BE AWARE THAT PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE. 2

4 Report of the Manager (continued) Risk and Reward Profile The synthetic risk and reward indicator for the St. James s Place Far East Unit Trust, as disclosed in its most recent Key Investor Information Document (KIID), is a 5. It was calculated using performance data up to 1 February Please note that following changes to the Scheme which took place on 10 October 2016, the risk category will be a category 6 and calculated using indicative performance data for the type of investments held. Investment Adviser's Comments Global equities rose during the period, with central banks monetary policies driving sentiment. Markets cheered as Japan and Europe imposed negative interest rates, while tepid economic data and deflationary pressures forced the US Federal Reserve to keep rates unchanged. These still-accommodative policies also helped markets recover quickly from the temporary jolt of Britain s unexpected decision to leave the European Union. Elsewhere, oil prices lifted when Opec members reached a preliminary deal to curb production. The overweight to Taiwan drove performance, where markets were buoyed by foreign demand for large-cap stocks. Conversely, the overweight to South Africa hurt performance, amid concerns of weak economic growth and political instability. The top contributors for the period were EOG Resources, an oil and gas company that benefited from an improved outlook for commodities and the engineering company, the Weir Group, which benefited from the increase in oil prices. As for detractors, the IT provider, Cognizant Technology s stock fell after it disclosed that it was conducting an internal probe to determine whether its payments in India violated anti-corruption laws. Another detractor over the period was Check Point Software who fell on weakness in the broader cyber-security sector. Despite the negatives, the portfolio rose over the six months and outperformed the benchmark FTSE World Index. We sold Canadian National Railway, which has performed well but faces an increasingly-challenging operating environment. We also exited the French energy management company Schneider, in favour of Japan s Keyence, a market leader that taps into growing demand for factory automation. Elsewhere, we introduced Japanese snack food company Calbee, which has promising long-term prospects, and Casey s General Stores, an attractively-valued, well-managed US convenience store operator. In terms of global growth, it seems to be faltering again. Political risks, namely, the outcome of the US presidential election and the commencement of the UK s formal Brexit negotiation process are likely to drive volatility. Major central banks have started to realise that prolonged easy monetary policy lacks the muscle to boost growth, and we are beginning to see the return of fiscal stimulus, notably in Japan and China. Despite this challenging environment, we remain focused on quality, and will seek opportunities to build our positions in well-managed businesses that are trading at attractive valuations. Aberdeen Asset Managers Limited 14 October

5 Report of the Manager (continued) From 10 October 2016, First State Investments (Hong Kong) Limited replaced Aberdeen Asset Managers Limited as Investment Adviser to the Trust. First State Stewart Asia is an independent investment management team within First State Investments. The team manages a range of Asia Pacific equity strategies on behalf of institutional and wholesale clients globally, with offices in Hong Kong, Singapore and Edinburgh. We are conviction-based, bottom-up stock selectors with a strong emphasis on high quality proprietary research. Our investment approach adopts an absolute return mind-set and is inherently conservative, focusing on capital preservation as well as capital growth. By focusing on the potential downside (not just the upside) when making an investment decision, the risk to long-term client returns is significantly reduced. We are long-term investors and prefer to invest in quality companies that we can hold onto for many years. The outlook for Asian equity markets remains uncertain. Despite the increasing prevalence of negative interest rates in developed markets, global growth remains muted. This lack of growth has resulted in challenging export conditions for Asian corporates. Low, and particularly negative, interest rates are likely to have many unforeseen consequences, but for now there are few inflationary pressures. If anything, the build-up of debt may become deflationary as cash flows are directed towards debt repayment. While inflation remains muted, in Asia, interest rate cuts are more likely than increases, as central banks look to stimulate domestic economies and avoid currency strength. 4

6 Comparative Table as at 30 September 2016 (unaudited) Net Asset Value and Ongoing Charges Figure 30/09/16 31/03/16 31/03/15 31/03/14 Income Closing net asset value ( 000) 12,428 10,305 14,221 12,191 Closing number of units 2,466,866 2,521,728 3,030,967 3,079,351 Closing net asset value per unit (p) Operating charges** 1.59% 1.61% 1.60% 1.62% 30/09/16 31/03/16 31/03/15 31/03/14 Accumulation Closing net asset value ( 000) 1,662,372 1,370,845 1,547,392 1,282,958 Closing number of units 278,246, ,741, ,033, ,469,280 Closing net asset value per unit (p) Operating charges** 1.59% 1.61% 1.60% 1.62% **Operating charges are prepared using the same methodology as the ongoing charges appearing in the KIID, based on the information in this report. Please note that following a change of Investment Adviser, with effect from 10 October 2016 the Investment Adviser Fee (IAF) for this Scheme will be 0.60 per cent (0.24 per cent previously). The Manager estimates that the future Ongoing Charges Figure for this Scheme will be 2.00%. 5

7 Portfolio Statement as at 30 September 2016 (unaudited) Security Holdings Market Value 000 % of Net Assets AUSTRALIA (7.20%) 98, BHP Billiton 1,918,000 25, CSL 388,000 24, QBE Insurance 990,728 5, Rio Tinto 1,442,145 43, BERMUDA (5.22%) 80, Dairy Farm International 1,883,100 10, Jardine Strategic 2,797,086 70, CAYMAN ISLANDS (0.43%) - - CHINA (1.75%) 31, Anhui Conch Cement 3,993,000 8, PetroChina 46,030,000 23, HONG KONG (11.66%) 193, AIA 10,993,400 56, China Mobile 3,855,000 35, Hang Lung 4,153,000 12, Hang Lung Properties 7,591,000 13, Hong Kong Exchanges and Clearing 846,874 17, MTR 2,873,232 12, Swire Pacific 'A' Shares 2,323,000 19, Swire Pacific 'B' Shares 12,025,000 17, Swire Properties 4,067,600 9, INDIA (3.67%) 53, Grasim Industries GDR 215,064 12, ICICI Bank ADR 1,394,000 7, Infosys ADR 1,016,400 12, ITC GDR 4,710,000 13, Ultratech Cement GDR* 171,464 7, INDONESIA (2.73%) 51, Astra International 34,000,000 16, Bank Central Asia 22,650,300 20, Unilever Indonesia 5,225,300 13, JAPAN (25.16%) 498, Calbee 499,400 14, Chugai Pharmaceutical 1,298,700 35, Daikin Industries 288,000 20, East Japan Railway 472,000 32, FANUC 282,900 36, Honda Motor 883,000 19, Japan Tobacco 1,671,800 52, KDDI 690,900 16, Keyence 78,600 44, Nippon Paint 1,203,700 30, Seven & I 1,516,300 54, Shin-Etsu Chemical 951,500 50, Sysmex 232,700 13, Toyota Motor 448,100 19, Unicharm 1,601,700 31, Yahoo Japan 7,936,800 24, LUXEMBOURG (4.71%) 78, Aberdeen Global - Indian Equity Fund 765,704 78,

8 Portfolio Statement (continued) as at 30 September 2016 (unaudited) Security Holdings Market Value 000 % of Net Assets MALAYSIA (1.55%) 14, Public Bank 3,831,633 14, PHILIPPINES (2.69%) 37, Ayala Land 60,459,560 37, SINGAPORE (14.41%) 222, City Developments 7,019,600 35, DBS 3,162,167 27, Keppel 7,399,900 22, Oversea-Chinese Banking 9,668,178 47, Singapore Technologies Engineering 17,668,000 32, Singapore Telecommunications 13,358,500 29, United Overseas Bank 2,541,149 27, SOUTH KOREA (4.26%) 93, AMOREPACIFIC 2, Amorepacific Preference Shares 99,486 14, NAVER 24,831 15, Samsung Electronics GDR 7,000 3, Samsung Electronics Preference Shares 67,024 60, TAIWAN (4.76%) 78, Taiwan Mobile 9,710,434 26, Taiwan Semiconductor Manufacturing 11,501,430 51, THAILAND (2.19%) 31, Siam Cement 2,736,900 31, UNITED KINGDOM (4.29%) 77, HSBC 8,402,688 47, Standard Chartered 4,729,144 29, Investment Assets 1,641, Total other assets (net) 33, Net assets 1,674, Comparative figures shown in brackets relate to 31 March All investments held are listed, unless otherwise stated. Stocks shown as ADRs and GDRs represent American Depositary Receipts and Global Depositary Receipts. * Unlisted securities. 7

9 Material Portfolio Changes Cost Purchases 000 KDDI 16,280 Keyence 15,648 Calbee 14,321 Sysmex 12,574 Nippon Paint 12,549 DBS 12,497 Amorepacific Preference Shares 12,202 East Japan Railway 11,470 Japan Tobacco 11,187 Yahoo Japan 10,726 Proceeds Sales 000 QBE Insurance 25,945 Chugai Pharmaceutical 13,737 Honda Motor 12,356 Samsung Electronics Preference Shares 10,345 Toyota Motor 10,247 United Overseas Bank 9,436 CIMB 8,514 Nippon Paint 6,936 Shin-Etsu Chemical 6,755 Li & Fung 6,720 8

10 Statement of Total Return for the period 01 April 2016 to 30 September 2016 (unaudited) Income Net capital gains/(losses) Revenue Expenses Interest payable and similar charges Net revenue before taxation Taxation Net revenue after taxation Total return before equalisation Equalisation Change in net assets attributable to unitholders from investment activities 01/04/16 to 30/09/16 01/04/15 to 30/09/ ,131 (330,236) 27,767 26,757 (12,052) (11,852) ,715 14,905 (1,455) (1,269) 14,260 13, ,391 (316,600) (95) ,296 (316,469) Statement of Change in Net Assets Attributable to Unitholders for the period 01 April 2016 to 30 September 2016 (unaudited) 01/04/16 to 30/09/16 01/04/15 to 30/09/ Opening net assets attributable to unitholders 1,381,150 1,561,613 Movement due to creation and cancellation of units: Amounts receivable on creation of units* 87, ,233 Amounts payable on cancellation of units* (111,580) (72,023) Change in net assets attributable to unitholders from investment activities (see above) Closing net assets attributable to unitholders (23,646) 29, ,296 (316,469) 1,674,800 1,274,354 Comparative information is provided for the Statement of Change in Net Assets Attributable to Unitholders. Since this information is for the prior interim period, the net assets at the end of that period do not correspond to the net assets at the start of the current period. *Prior year figures in relation to Dilution Levy have been reclassified and included within creations and cancellation of units as this was income and expenses arising from creations and cancellations respectively. 9

11 Balance Sheet as at 30 September 2016 (unaudited) Assets Investments Current assets Debtors Cash and bank balances Total assets Liabilities Creditors Distribution payable Other creditors Total liabilities Net assets attributable to unitholders 30/09/ /03/ ,641,182 1,335,319 6,169 17,780 30,484 30,577 1,677,835 1,383,676 - (106) (3,035) (2,420) (3,035) (2,526) 1,674,800 1,381,150 Accounting and Distribution policies for the period 01 April 2016 to 30 September 2016 (unaudited) Basis of accounting The Financial Statements have been prepared under the historical cost basis, as modified by the revaluation of investments, in compliance with the Financial Conduct Authority's Collective Investment Schemes Sourcebook. They have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 (The Financial Reporting Standard applicable in the UK and Republic of Ireland FRS 102) and in accordance with the Statement of Recommended Practice (SORP) for Financial Statements of Authorised Funds issued by the Investment Management Association May 2014 (IMA SORP 2014). The changes in the SORP 2014 are presentational only and there have been no changes to any figures detailed with the financial statements. The financial statements are prepared on the going concern basis. Directors of the Managers' Certificate This report is certified in accordance with the requirements of the rules in the Financial Conduct Authority's Collective Investment Schemes Sourcebook. A. M. Croft D. J. Lamb 25 November

12 General Information Unit Dealings Dealings on the Trust take place on a daily basis. Purchase or sale instructions can be made by telephone or in writing to St. James's Place Unit Trust Group Limited, PO Box 9034, Chelmsford, CM99 2XA, United Kingdom, freephone: The Manager adopts a policy of forward pricing, i.e. the order will be transacted on the dealing day following receipt of the client's instructions, or if received before noon, on that dealing day. In the case of telephone purchases of units from the Manager, settlement must be by return of post after receipt of the contract note. In the case of telephone redemptions, the proceeds will not become payable until the receipt at the Administration Centre of a written request. A contract note confirming the subscription or redemption price and the number of units involved will be forwarded, together with a cancellation notice, where appropriate, on the next business day. The most recent issue and redemption prices will be published on the Manager's website: and are available by calling the Administration Centre on Minimum Investment The minimum lump sum investment is 1,500, thereafter the minimum additional investment is 1,000. The minimum monthly investment is 150 and the minimum monthly increment is 50. The minimum annual investment is 1,500 and the minimum annual increment is 500. Renaming of Unit Classes On 10 October 2016 the Manager denominated the existing unit class in the fund as Class L units. This change will have no impact on the way in which the fund is managed or how daily unit prices are calculated. H & Y Unit Classes On 10 October 2016 the Manager launched Class H and Class Y accumulation unit classes. Restrictions apply to all Class H and Class Y units, please see the Prospectus for details. Management Charges The Trust Deed permits the following management charges which are receivable by the Manager: (a) A Preliminary Charge of 5 per cent which is included in the offer price of the Units. (b) An Annual Management Charge at a rate of 1.36 per cent of the value of the Trust. Income Distributions Income distributions are made annually on or before the 31 May. Accumulation Distributions Revenue due to accumulation unitholders is reflected in the price of their units. Tax Vouchers Income unitholders that receive income distributions by direct credit and accumulation unitholders (where the distribution income is reinvested) receive an annual consolidated tax voucher in May with all the relevant payment and tax information required to complete a tax return. Tax vouchers will be enclosed if income unitholders receive payment by cheque. Capital Gains Tax The Trust is not liable to tax on capital gains and any individual holding units will not be liable to capital gains tax unless the total chargeable gains for the tax year 2016/2017 exceed 11,100 (2015/ ,100). To calculate capital gains on accumulation units, the total amount of reinvested net revenue (shown on the annual tax credit vouchers) should be added to the base cost of the units purchased. Unitholders should consult their professional advisers for any advice regarding their tax position. 11

13 St. James s Place Unit Trust Group Ltd is authorised and regulated by the Financial Conduct Authority. St. James s Place Unit Trust Group Ltd Registered Office: St. James s Place House, 1 Tetbury Road, Cirencester, Gloucestershire, GL7 1FP, United Kingdom. Registered in England Number Perivan Financial Print Far East (11/16)