HIGH OCTANE UNIT TRUST

Transcription

1 HIGH OCTANE UNIT TRUST FOR THE PERIOD ENDED 30 SEPTEMBER 2015

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 Oldfield Partners LLP 11 Grosvenor Place London SW1X 7HH 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 During the period under review, 1 April 2015 to 30 September 2015, the St. James's Place High Octane Unit Trust Income unit offer price fell by 16.7% from 121.0p to 100.8p and the Accumulation unit offer price (in which revenue is reflected in the price rather than distributed) fell by 16.5% from 123.1p to 102.8p. The Trust's Performance The performance of the Trust since its launch in April 2008, over the five year period since September 2010 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. Income units (offer to offer) Accumulation units (offer to offer) Indices - actual MSCI World (Total Return) Source: Lipper for Fund returns 07/04/08 to 30/09/10 to 31/03/15 to 30/09/15 30/09/15 30/09/15 % 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. Investment Adviser's Comments This was a challenging period for equities in general and for the portfolio specifically, which trailed the broad global equity market. The current investment mood is dark, we believe unduly dark. Our estimation of the potential upside in the portfolio (i.e. the difference between the share price today and our estimate of their fair value) is at levels not seen since March This was a time when many people were advocating a much reduced exposure to equities in the expectation of a weak economy and low market returns in the years ahead. This has prompted us to look at the detail of our expectations at that time. Over the ensuing two years, to the end of 2010, the average upside was fully met, and at a time of good relative performance. Moreover, with the exception of only four or five stocks, the order of magnitude in the expected upside was roughly right. This is comforting to us now and we stick firmly to our knitting, which is to focus on valuations. Many cyclical companies share prices seem to have the expectation of recession built into them, and the absence of recession would be very positive for these. Our increase in exposure to more cyclical companies has been premature, but it is in many of these companies that we see value and therefore the potential for good returns over the medium term. The five largest detractors from performance were Staples, Tesco, Samsung, Barrick Gold and General Motors. The five best performers were NTT, Microsoft, Kansai Electric Power, East Japan Railway and MUFG. Four of the outperformers were Japanese. The Japanese market remains the best performing major stock market year-to-date. All the companies we hold still have, in our view, a large gap between share price and their true value, and both shareholders and authorities are coaxing managements into greater focus on return on equity both parts of the formula: profitability and balance sheet efficiency. The portfolio is invested in companies with businesses which are essentially sound but whose share prices appear undervalued. There has been little change in our major themes, with a highly significant position in Japan, and a focus on valuation leading us to some unpopular areas such as commodities and energy companies. Oldfield Partners LLP 14 October

4 Performance Record Unit Price History and Record of Net Distributions Paid/Payable The record of net distributions paid/payable per unit is shown below: Income Calendar year * Accumulation Calendar year * Net revenue distributed Highest Lowest per 1,000 Invested Offer Bid per unit at 04/01/10 p p p Net revenue distributed Highest Lowest per 1,000 Invested Offer Bid per unit at 04/01/10 p p p Net Asset Values Income Year ended March * Accumulation Year ended March * Market NAV NAV Units in Issue of Class per Unit '000 p 1,398,245 1, , , , Market NAV NAV Units in Issue of Class per Unit '000 p 160,604, , ,178, , ,833, , ,760, , Ongoing Charges Figure The Ongoing Charges Figure for the period ended 30 September 2015 was 2.13% (31 March 2015: 2.12%) for Income units and 2.13% (31 March 2015: 2.12 %) for Accumulation units. The Ongoing Charges Figure ('OCF') is the total expenses paid by the Trust in the period, annualised, against its average net asset value. It excludes the cost of buying or selling assets for the Trust (unless these assets are shares of another trust). The OCF can fluctuate as underlying costs change. * To 30 September

5 Performance Record (continued) Risk and Reward Profile The synthetic risk and reward indicator for the St. James s Place High Octane Unit Trust, as disclosed in its most recent Non-UCITS Retail Scheme Key Investor Information Document (NURS- KIID), is 5. It was calculated using performance data up to 26 October The risk category is recalculated weekly and during the period under review, the risk category did not change. 4

6 Portfolio Statement as at 30 September 2015 (unaudited) Security Holdings Market Value 000 % of Net Assets CANADA (2.38%) 2, Barrick Gold 672,700 2, GERMANY (0.00%) 5, E.ON 1,037,669 5, ITALY (3.78%) 6, Eni 621,854 6, JAPAN (32.84%) 62, East Japan Railway 157,700 8, Kansai Electric Power 975,800 7, Komatsu 796,000 7, Kyocera 300,200 8, Mitsubishi UFJ Financial 2,869,400 11, Nomura 2,162,000 8, Toyota Motor 292,700 11, LUXEMBOURG (2.31%) - - RUSSIA (3.89%) 6, Lukoil ADR 265,980 6, SOUTH KOREA (5.36%) 8, Samsung Electronics 12,934 8, UNITED KINGDOM (21.28%) 35, BP 2,677,591 8, Rio Tinto 580,866 12, St. James's Place Money Market Unit Trust L Acc 2,976,669 3, Tesco 5,925,432 10, UNITED STATES (27.17%) 52, Citigroup 362,500 11, General Motors 612,500 11, Hewlett-Packard 614,000 9, Microsoft 368,600 10, Staples 1,108,900 8, Investment assets 180, Total other assets (net) 2, Net assets 182, Comparative figures shown in brackets relate to 31 March All investments held are listed, unless otherwise stated. Stocks shown as ADRs represent American Depositary Receipts. During the period under review the Manager decided to place some of the sterling cash held on deposit into the St. James s Place Money Market Unit Trust in order to spread risk across a number of institutions. The St. James s Place Money Market Unit Trust is highly liquid and is rated AAA by Standard & Poors. This investment is a related party. This is a cash equivalent asset. 5

7 Material Portfolio Changes Cost Purchases 000 St. James's Place Money Market Unit Trust L Acc 22,731 Komatsu 9,732 Nomura 9,529 Rio Tinto 7,510 E.ON 6,997 Kansai Electric Power 5,996 Nintendo 3,891 Hewlett-Packard 3,619 General Motors 2,383 BP 1,835 Proceeds Sales 000 St. James's Place Money Market Unit Trust L Acc 32,178 Nintendo 11,214 Nippon Telegraph & Telephone 7,906 Japan Airlines 5,905 ArcelorMittal 4,916 Mitsubishi UFJ Financial 2,899 East Japan Railway 1,594 Eni 737 This investment is a related party. 6

8 Statement of Total Return for the period 01 April 2015 to 30 September 2015 (unaudited) Income Net capital losses Revenue Expenses Interest payable and similar charges Net revenue before taxation Taxation Net revenue after taxation Total return before distributions Equalisation Change in net assets attributable to unitholders from investment activities 01/04/15 to 30/09/15 01/04/14 to 30/09/ (36,157) (4,406) 2,799 2,580 (2,189) (1,983) (289) (273) (35,836) (4,082) - 1 (35,836) (4,081) Statement of Change in Net Assets Attributable to Unitholders for the period 01 April 2015 to 30 September 2015 (unaudited) 01/04/15 to 30/09/15 01/04/14 to 30/09/ Opening net assets attributable to unitholders 211, ,195 Movement due to creation and cancellation of units: Amounts receivable on creation of units 20,712 7,398 Amounts payable on cancellation of units (14,112) (2,998) Dilution levy charged Stamp duty reserve tax Change in net assets attributable to unitholders from investment activities Class actions Closing net assets attributable to unitholders 6,600 4, (2) (35,836) (4,081) , ,556 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. The prices per unit as at 30 September 2015 (unaudited) were: Income units Accumulation units Bid Offer p p

9 Balance Sheet as at 30 September 2015 (unaudited) Assets Fixed assets Investments 30/09/15 31/03/ , ,815 Current assets Debtors 836 1,165 Cash and bank balances 1,275 1,823 Cash equivalents 3,105 12,550 Total assets Liabilities Creditors Distribution payable Other creditors Total liabilities Net assets attributable to unitholders Accounting and Distribution policies for the period 01 April 2015 to 30 September 2015 (unaudited) 182, ,353 - (2) (18) (891) (18) (893) 182, ,460 Basis of accounting The interim financial statements have been prepared under the historical cost basis, as modified by the revaluation of investments, and in accordance with the Statement of Recommended Practice (SORP) for Financial Statements of Authorised Funds issued by the Investment Management Association (IMA) in May 2014 (the IMA SORP 2014) and United Kingdom Generally Accepted Accounting Practice. Adoption of IMA SORP 2014 Changing in accounting policies There have been no changes to the accounting policies as detailed in the audited financial statements for the year end 31 March Changes in presentation The presentation of these financial statements has been changed from the previous period to comply with the requirements of the IMA SORP The main change is: amendments to labelling of some line items within the financial statements. amendments to categorisation of some line items within the financial statements. Directors' Certificate This report is certified in accordance with the requirements of the rules in the Financial Conduct Authority's Collective Investment Schemes Sourcebook. Directors A. M. Croft London D. J. Lamb 26 November

10 General Information 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 5 March The Unit Trust is subject to the rules of the Financial Conduct Authority's Collective Investment Scheme Sourcebook and is classified as a Non-UCITS retail scheme. The Trust Manager The Manager of the Trust is St. James's Place Unit Trust Group Limited which is authorised and regulated by the Financial Conduct Authority. St. James's Place were registered to comply with AIFMD disclosures on 21 July Investment Objectives The investment objective of the Scheme is to provide capital appreciation through investment in a concentrated portfolio of quoted securities on a worldwide basis. The Scheme will be invested, at the Manager's discretion, primarily in global equities and may also be invested in cash or near cash. The Scheme is also permitted to invest in other asset classes permitted for Non-UCITS Retail Schemes under COLL including transferable securities, money market instruments, cash and near cash, units in collective investment schemes and deposits. The Scheme is permitted to invest in derivative and forward transactions for the purposes of efficient portfolio management (including hedging). There are no specific restrictions on the investment of the Scheme including as to economic sector or geographical area except as set out below and as provided in COLL. 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. European Savings Directive As a Non-UCITS retail scheme, the Trust is currently exempt from the reporting requirements of this Directive. 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

11 General Information (continued) Management Charges With effect from 26 October 2015 the Manager has changed the charging structure of the Scheme. The annual management charge has been adjusted to include many of the predictable costs, such as trustee fees and administration fees, which were previously charged directly to the Scheme, and to exclude the fees for Investment Advisers, which are now charged directly to the Scheme. These changes are therefore presentational only and there is no overall increase in the total charges met by the Scheme. In addition, the way the annual management charge is calculated has been changed. The charge was previously calculated monthly, based on the Scheme value on the first business day of the month; in future it will be calculated daily, based on the Scheme value every day. 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 1.37 per cent (2.02 per cent prior to 26 October 2015) 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. Report A report is sent semi-annually to all unitholders on or before 31 May and 30 November. 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 2015/2016 exceed 11,100 (2014/ ,000). 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. Remuneration Following the implementation of AIFMD in the UK, all authorised AIFMs are required to comply with the AIFMD Remuneration Code. On 21 July 2014 St. James s Place Unit Trust Group Limited became an AIFM. The AIFMs financial year end is 31 December, it is therefore anticipated that the AIFMs Remuneration Policy and associated financial disclosures will be made within AIFMs Annual Reports from 31 December 2015, following its first full performance period. Prior to this date the AIFM would be part way through its first performance period and the information available would not be relevant or provide a proper basis for comparison. Leverage The total amount of leverage employed by the Trust as at 30 September 2015, is 98.87% on the gross basis and 0% calculated on the commitment basis. 10

12 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 High Octane (11/15)