Interim Report & Financial Statements. WAY MA Portfolio. For the six months ended 30 September 2017 (unaudited)

Transcription

1 Interim Report & Financial Statements WAY MA Portfolio For the six months ended 30 September 2017 (unaudited)

2 contents WAY MA Portfolio Page Authorised Corporate Director s ( ACD ) Report* 3 Certification of Financial Statements by Directors of the ACD* 4 Notes to the Financial Statements 5 Individual Funds Investment Commentary and Financial Statements WAY Absolute Return Portfolio Fund 6 WAY Green Portfolio Fund 14 WAY MA Cautious Portfolio Fund 22 General Information 30 Contact Information 33 * Collectively these comprise the ACD s Report. 2

3 WAY MA Portfolio Authorised Corporate Director's Report We are pleased to present the Interim Report & Financial Statements for WAY MA Portfolio for the six months ended 30 September Authorised Status WAY MA Portfolio ("the Company") is an investment company with variable capital ("ICVC") incorporated in England and Wales under registered number IC and authorised by the Financial Conduct Authority ("FCA"), with effect from 29 May The Company has an unlimited duration. Shareholders are not liable for the debts of the Company. Head Office: the Head Office of the Company is at Cedar House, 3 Cedar Park, Cobham Road, Wimborne, Dorset BH21 7SB. The Head Office is the address of the place in the UK for service on the Company of notices or other documents required or authorised to be served on it. Structure of the Company The Company is structured as an umbrella company, in that different Funds may be established from time to time by the ACD with the approval of the FCA. On the introduction of any new Fund or Share Class, a revised prospectus will be prepared setting out the relevant details of each Fund or Share Class. The Company is a non-ucits retail scheme ("NURS"). The assets of each Fund will be treated as separate from those of every other Fund and will be invested in accordance with the investment objective and investment policy applicable to that Fund. Investment of the assets of each of the Funds must comply with the FCA's Collective Investment Schemes Sourcebook ("COLL"), the FCA's Investment Funds Sourcebook ("FUND") and the investment objective and policy of the relevant Fund. Currently the Company has four Funds. In the future there may be other Funds established. Under the Alternative Investment Fund Managers Directive ( AIFMD ) we are required to disclose remuneration information (see Page 31) in regards to those individuals whose actions have a material impact on the risk profile of the Fund. Crossholdings There were no Shares in any fund held by any other fund of the Company. Important events during the period WAY Charteris Gold & Precious Metals Fund was the subject of a Scheme of Arrangements on 1st April 2017 which meant that all the assets and holders transferred to another fund. The Fund now holds no assets and is in the process of official termination. Base Currency: The base currency of the Company is Pounds Sterling. Share Capital: The minimum Share Capital of the Company is 1 and the maximum is 100,000,000,000. Shares in the Company have no par value. The Share Capital of the Company at all times equals the sum of the Net Asset Values of each of the Funds. 3

4 WAY MA Portfolio Certification of Financial Statements by Directors of the ACD For the six months ended 30 September 2017 (unaudited) Directors' Certification This report has been prepared in accordance with the requirements of COLL and FUND, as issued and amended by the FCA. We hereby certify the report on behalf of the Directors of WAY Fund Managers Limited. The Directors are of the opinion that it is appropriate to continue to adopt the going concern basis in the preparation of the Financial Statements as the assets of the Funds consist predominantly of securities that are readily realisable, and accordingly, the Funds have adequate resources to continue in operational existence for the foreseeable future. V. Hoare I. Hobday WAY Fund Managers Limited 30 November

5 WAY MA Portfolio Notes to the Financial Statements For the six months ended 30 September 2017 (unaudited) Accounting Basis, Policies and Valuation of Investments 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 FRS 102 The Financial Reporting Standards Applicable in the UK and Republic of Ireland and the Statement of Recommended Practice ( SORP ) for Financial Statements of UK Authorised Funds issued by the Investment Association in May The accounting policies applied are consistent with those of the audited annual Financial Statements for the year ended 31 March 2017 and are described in those Financial Statements. In this regard, comparative figures from previous periods are prepared to the same standards as the current period, unless otherwise stated. As described in the Certification of Financial Statements by Directors of the ACD on page 4, the ACD continues to adopt the going concern basis in the preparation of the Financial Statements of the Funds. Basis of valuation of investments Listed investments are valued at close of business bid prices excluding any accrued interest in the case of fixed interest securities, on the last business day of the accounting period. Market value is defined by the SORP as fair value which is the bid value of each security. Collective Investment Schemes are valued at quoted bid prices for dual priced funds and at quoted prices for single priced funds, on the last business day of the accounting period. Non-observable entity specific data is only used where relevant observable market data is not available. Typically this category will include single broker-priced instruments, suspended/unquoted securities, private equity, unlisted close-ended funds and open-ended funds with restrictions on redemption rights. 5

6 WAY Absolute Return Portfolio Fund Investment Manager s Report For the six months ended 30 September 2017 (unaudited) Investment Objective The objective of the Fund is to achieve long term capital appreciation in the form of a positive absolute return for investors in all market conditions on a 12 month basis. Capital invested in the Fund is at risk and there is no guarantee that the investment objective will be met over the 12 month period or in respect of any other period. Investment Policy The Fund will aim to achieve its investment objective by utilising a diversified portfolio of transferable securities (including investment trusts), Collective Investment Schemes, warrants, cash or near cash, deposits and money market instruments, seeking to deliver absolute returns using a variety of suitable strategies. Subject to the requirements of the Regulations, the portfolio will normally remain fully invested. There will, however, be no restrictions on the underlying content of the investments held, in terms of investment type, geographical or economic sector, other than those imposed by the Regulations, meaning that the Investment Adviser has the absolute discretion to weight the portfolio towards any investment type or sector at any time. The Fund may also invest in unregulated Collective Investment Schemes (where investment in such funds is consistent with the investment objective and policy of the Fund). The use of derivatives and/or hedging transactions are permitted in connection with the efficient portfolio management of the Fund, and borrowing will be permitted in accordance the Regulations. The Fund may, in addition to its other investment powers, use derivatives and forward transactions for investment purposes. It is not intended that the use of derivatives in this way will change the risk profile of the Fund. Investment Review Having become Investment Adviser to the fund in late 2016 and Manager to the fund in April 2017, we are pleased with the performance shown so far. In the last six and twelve month periods we have outperformed our benchmark (Consumer Price Index (CPI) + 5%) and the sector (IA Targeted Absolute Return) FE Trustnet) with a return of around 7.8% for the year and 3.5% for six months. We have adopted a Mosaic Theory Investment strategy allowing us to select investment opportunities which fit within our risk and return parameters without following the traditional filter approach. This has allowed us to make some alternative investments to increase the return to clients while maintaining the appropriate risk, and avoiding the potential pitfalls of buying high in what are currently some very highly priced markets. Our Strategic asset allocations have been maintained during the cycle, however we have changed many of the incumbent investments held when we took control of the fund. This was mainly due to a more aggressive selection focussed on manager s performance. This has increased the Ongoing Charges Figure (OCF) to the underlying client however, but has allowed us to take advantage of many well respected fund managers in their respective fields. A number of passive Exchange Traded Funds (ETFs) such as tracker funds have therefore been bought while reducing exposure to direct bond investments. Exposure to US equity has been obtained through ishares Dow Jones Industrial Average for passive tracking, combined with the Schroders US Mid Cap fund for more actively managed elements within this sector. We are particularly pleased with the Old Mutual UK Mid cap fund which has returned c.20% since purchase. We have also taken some tactical decisions including the investment into an Alternative Investment Market (AIM) company, Diversified Gas and Oil, which allows for significant capital growth combined with a high yield. We have also negotiated some significant benefits to our clients such a profit shares from a company where we own a corporate bond. 6

7 WAY Absolute Return Portfolio Fund Investment Manager s Report (continued) For the six months ended 30 September 2017 (unaudited) Market Overview The past year has seen equity market trade up to record or near record highs across the world. We have had some short-term reaction to political events but soon recovered the upward trend. The main support for this has been low interest rates and Quantitative Easing (QE) from the major central banks, bringing back growth to the economies. The next year could be more challenging as the Federal Reserve has started to raise interest rates and the European Central Bank (ECB) is likely to stop QE. For the trend to continue we need to see the growth to continue. With the low interest rates bonds look expensive and if rates do rise will see the values go down. The United States (US) dollar has not risen substantially with the rise in interest rates so emerging markets have also performed well. For the following year equities and property look the best place for capital gains. Outlook Looking forward, we will continue to assess market conditions and aim to adjust the strategic asset allocation of the fund to allow for the best possible risk/return ratio, while always aiming for a positive outcome. We currently believe that both Equity Markets and Fixed Income are quite highly priced, but we are not ruling out further upward drift in the existing environment. This could all change rapidly due to many global factors such as Brexit and President Trump's actions. Unfortunately we must also consider further terrorist actions like those suffered by the UK in May, however these do not seem to have had a material impact on the markets so far. We will continue to monitor all these events and will move swiftly to protect clients by altering our Strategic Asset Allocation to more defensive postures when the time is right. In the meantime, we are continuing to hunt for bargains and opportunities which we feel will provide a positive return for our clients while managing the appropriate risk. This way we will protect clients capital from any significant falls, while offering an above average upside. Investment Manager Financial Advisors to Consultant Engineers and Technologists Limited (FACET) 24 October

8 WAY Absolute Return Portfolio Fund Net Asset Value per Share and Comparative Table As at 30 September 2017 (unaudited) Net Asset Value Date Net Asset Value Net Asset Value Percentage Share Class ( ) Shares in issue pence per Share Change (%) Share Class A Income 31/03/17 217, , /09/17 220, , Share Class E Accumulation 31/03/17 12,218,683 9,926, /09/17 9,454,205 7,533, Share Class E Income 31/03/17 147, , /09/17 118,686 98, Share Class Retail Accumulation 31/03/17 173, , /09/17 176, , Share Class S Income 31/03/17 556, , /09/17 578, , Share Class T Income 31/03/17 1,352,552 1,158, /09/17 1,366,094 1,149, Share Class Z Accumulation 31/03/17 1,061 1, /09/17 595, , Share Class Z Income 31/03/17 1,052 1, /09/17 1,071 1, Distribution The Fund distributes annually, following the annual accounting period. Therefore there is no distribution in the current period. 8

9 WAY Absolute Return Portfolio Fund Performance Information As at 30 September 2017 (unaudited) Operating Charges Operating Charges Synthetic excluding Other expense Transaction Performance Performance Operating AMC expenses ratio costs fee fee* Charges Date (%) (%) (%) (%) (%) (%) (%) 30/09/17 Share Class A Share Class E Accumulation Share Class E Income Share Class Retail Accumulation Share Class Retail Income Share Class S Share Class T Share Class Z /03/17 Share Class A Share Class E Accumulation Share Class E Income Share Class Institutional Share Class Retail Accumulation Share Class Retail Income Share Class S Share Class T Share Class Z Share Class Institutional Accumulation closed on 19 September Share Classes Z Accumulation and Z Income were launched 11 August However, the first dealings were on 24 August The Operating Charge is the total expenses paid by the Fund in the period, annualised, against its average Net Asset Value. This will fluctuate as underlying costs change. The Fund has invested in Collective Investment Schemes during the period and the expenses incurred by these schemes are included in the above as the Synthetic expense ratio. *Performance fee is applied under certain conditions. The amount of Performance Fee payable in respect of each Calculation Period is a Sterling amount equivalent to the product of (a) the Net Asset Value per Share on the last Business Day of the relevant Calculation Period (b) the excess performance within the qualifying performance band (c) the relevant performance fee increment (%) and, (d) the average number of Shares in issue during the Calculation Period. The Performance Fee will be calculated and accrued daily but will only become payable annually in arrears in respect of each discrete period of twelve months ending on 31 March in each year (the 'Annual Calculation Period'). The Performance Fee will accrue daily as if each day were the end of an Annual Calculation Period. Risk Warning An investment in an Open-Ended Investment Company should be regarded as a medium to long term investment. Investors should be aware that the price of Shares and the income from them may fall as well as rise and investors may not receive back the full amount invested. Past performance is not a guide to future performance. Investments denominated in currencies other than the base currency of a fund are subject to fluctuation in exchange rates, which may be favourable or unfavourable. 9

10 WAY Absolute Return Portfolio Fund Portfolio Statement As at 30 September 2017 (unaudited) Holdings or Nominal Market value % of Total Value Investments Net Assets Emerging Markets 1.69% [1.34%] Collective Investment Schemes 1.69% [1.34%] 287,784 Jupiter Global Emerging Markets Income 211, , Europe 39.90% [37.74%] Collective Investment Schemes 24.71% [24.79%] 22,000 Ethika Sustainable Impact 2,174, ,311 Henderson European Selected Opportunities 370, ,736 Man GLG Continental European Growth 546, ,091, Fixed Interest 15.19% [12.95%] 1,900,000 European Investment Grade Properties 6.5% 31/03/2023* 1,900, ,900, Global 11.66% [12.07%] Collective Investment Schemes 11.66% [12.07%] 19,773 ishares Edge MSCI World Minimum Volatility 615, ,257 ishares Global Infrastructure 471, ,000 Kames Investment Grade Bond 372, ,459, United Kingdom 25.89% [26.02%] Collective Investment Schemes 18.33% [18.06%] 441,851 CF Woodford Equity Income 573, ,848 ishares Index-Linked Gilts 242, ,572 Old Mutual UK Mid Cap 673, ,113 Royal London Sterling Extra Yield Bond 804, ,293, Equities 4.36% [3.27%] 737,615 Diversified Gas & Oil 545, , Fixed Interest 3.20% [2.73%] 4 All Saints Asset Management 6.50% 30/09/ , , Investment Companies 0.00% [1.96%] United States of America 19.13% [19.08%] Collective Investment Schemes 7.94% [7.49%] 2,944 ishares Dow Jones Industrial Average 527, ,723 Schroder US Mid Cap 465, , Fixed Interest 11.19% [11.59%] $1,400,000 Carpe Valorem 7% 12/05/2021* 1,400, ,400,

11 WAY Absolute Return Portfolio Fund Portfolio Statement (continued) As at 30 September 2017 (unaudited) Holdings or Nominal Market value % of Total Value Investments Net Assets Portfolio of investments 12,294, Net other assets 216, Net assets 12,511, All investments are Collective Investment Schemes unless otherwise stated. Comparative figures shown above in square brackets relate to 31 March *European Investment Grade Properties 6.5% and Carpe Valorem 7% are currently in breach of the concentration limits for the fund. The Investment Manager is aware of this and working to rectify the situation as soon as possible. Gross purchases for the six months: Nil [2016: 32,397,766]. Total sales net of transaction costs for the six months: 2,037,837 [2016: 23,031,708]. 11

12 WAY Absolute Return Portfolio Fund Statement of Total Return For the six months ended 30 September 2017 (unaudited) 01/04/17 to 30/09/17 01/04/16 to 30/09/16 Income Net capital gains 160,111 1,234,393 Revenue 200, ,740 Expenses (65,370) (128,321) Interest payable and similar charges - (436) Net revenue before taxation 134, ,983 Taxation (17,654) (22,022) Net revenue after taxation 117, ,961 Total return before distributions 277,174 1,415,354 Distributions (13,593) (31,281) Change in net assets attributable to Shareholders from investment activities 263,581 1,384,073 Statement of Change in Net Assets Attributable to Shareholders For the six months ended 30 September 2017 (unaudited) 01/04/17 to 30/09/17 01/04/16 to 30/09/16 Opening net assets attributable to Shareholders 14,667,915 8,329,811 Amounts received on issue of Shares 1,321,605 20,833,945 Less: Amounts paid on cancellation of Shares (3,744,030) (12,492,991) (2,422,425) 8,340,954 Dilution levy 2,266 36,703 Change in net assets attributable to Shareholders from investment activities (see above) 263,581 1,384,073 Closing net assets attributable to Shareholders 12,511,337 18,091,541 The above statement shows the comparative closing net assets at 30 September 2016 whereas the current accounting period commenced 1 April

13 WAY Absolute Return Portfolio Fund Balance Sheet As at 30 September 2017 (unaudited) 30/09/17 31/03/17 Assets Fixed assets: Investment assets 12,294,861 14,119,717 Current assets: Debtors 95, ,333 Cash and bank balances 363,208 24,671 Total current assets 458, ,004 Total assets 12,753,643 14,932,721 Liabilities Creditors: Bank overdrafts - (4) Distribution payable on income Shares - (14,400) Other creditors (242,306) (250,402) Total creditors (242,306) (264,806) Total liabilities (242,306) (264,806) Net assets attributable to Shareholders 12,511,337 14,667,915 13

14 WAY Green Portfolio Fund Investment Manager s Report For the six months ended 30 September 2017 (unaudited) Investment Objective The objective of the Fund is to produce capital growth with the potential for income. Investment Policy The Fund will aim to achieve its investment objective through thematic investment in a portfolio of Collective Investment Schemes, transferable securities (including investment trusts), warrants, cash or near cash, deposits and money market instruments. The focus of the thematic approach is to select investments based on their green 1 investments that in turn focus on social and environmental considerations. credentials such as Subject to the requirements of the Regulations, the portfolio will normally remain fully invested. There will, however, be no restrictions on the underlying content of the investments held, in terms of investment type, geographical or economic sector, other than those imposed by the Regulations, meaning that the Investment Adviser has the absolute discretion to weight the portfolio towards any investment type or sector at any time. The Fund may also invest in unregulated Collective Investment Schemes (where investment in such funds is consistent with the investment objective and policy of the Fund). The use of derivatives and/or hedging transactions are permitted in connection with the efficient portfolio management of the Fund, and borrowing will be permitted in accordance with the Regulations. On giving 60 days' notice to shareholders, the Fund may, in addition to its other investment powers, use derivatives and forward transactions for investment purposes. It is not intended that the use of derivatives in this way will change the risk profile of the Fund. 1 Green investments include but are not limited to, assets in which the underlying businesses or investment strategies are, in whole or in part, aimed at improving the environment in ecological and/or social terms. Research and development in Green areas will continue to develop over time bringing with it ever increasing breadth and diversity in this area of investment. Investment Review The last 6 months have seen a number of tragic events, with ISIS inspired terror attacks, the Grenfell Tower fire, hurricanes, earthquakes and one of the worst mass shootings in US history. Our first thoughts and sympathies are with the victims and their families and friends. Yet despite these terrible events and a number of potentially damaging geo-political developments, equity markets have been relatively benign for investors. The Korean nuclear tests caused some alarm and a lot of sabre rattling in Pyongyang and Washington, but the volatility in markets was short lived. In general, this has been down to positive economic data and a second quarter earnings season that was better than expected. Over the 6-month period, the WAY Green Fund returned -0.34%, as the write-down of the Quadris Forestry asset weighed heavily on performance. Quadris has been a source of immense frustration for us, having become illiquid several years ago due to problems with cash flow. Despite numerous attempts to resolve issues with their creditors, there has been little progress in restructuring their debt financing and the sharp fall in the price of Teak this year has also seen the NAV suffer. Matters were finally brought to a head earlier this year when the fund was served notice, claiming that is was in default of its loan agreement. As a result of this, and with careful consideration of the loan agreement, it was decided by the fair pricing committee that the asset should be written down to zero. Ahead of this decision, the holding represented around a 3.80% position on the WAY Green Fund and so the fund suffered an equivalent drawdown on the day of the announcement. Frustratingly the fund would have had a very strong 6 months, were it not for the holding in Quadris, as a number of our underlying funds performed extremely well. In particular, the SAM Smart Materials fund continued its strong start to the year, returning 9.91% and taking its 12 month return to 32.20%. Year to date the Fund has continued its strong run from last year and even with the Quadris writedown it has returned +7.12% to the end of September. 14

15 WAY Green Portfolio Fund Investment Manager s Report (continued) For the six months ended 30 September 2017 (unaudited) Outlook Looking forward, the political landscape continues to be volatile. Escalating tensions on the Korean peninsula show little sign of abating, whilst populism is clearly on the rise again in Europe. From a UK perspective, we cannot ignore the Brexit negotiations, and the impact this will have on both the currency and domestic companies. However, despite all these political uncertainties, economic data has been positive and we have seen earnings growth from many companies around the world. Indeed 2017 is the first time in many years that we have a seen a synchronized pick up in global growth. As a result, equity markets are likely to find continued support, even after the steep rises we have seen in the past few years. Investment Manager LGT Vestra LLP 26 October

16 WAY Green Portfolio Fund Net Asset Value per Share and Comparative Table As at 30 September 2017 (unaudited) Net Asset Value Date Net Asset Value of Net Asset Value Percentage Share Class ( ) Shares in issue pence per Share Change (%) Share Class E Elite Accumulation 31/03/17 282, , /09/17 302, , Share Class E Elite Income 31/03/17 131, , /09/17 156, , Share Class Elite Institutional Accumulation 31/03/17 2,386,537 1,899, /09/17 2,214,036 1,689, Share Class Elite Retail Accumulation 31/03/17 1,707,993 1,414, /09/17 1,084, , Share Class E WAY Accumulation 31/03/17 183, , /09/17 859, , Share Class S WAY Income 31/03/ /09/ Share Class T WAY Income 31/03/17 158, , /09/17 182, , Share Class WAY Retail Accumulation 31/03/17 88,545 73, /09/17 96,404 76, Share Class WAY Retail Income 31/03/17 334, , /09/17 347, , Distribution The Fund distributes annually, following the annual accounting period. Therefore there is no distribution in the current period. 16

17 WAY Green Portfolio Fund Performance Information As at 30 September 2017 (unaudited) Operating Charges Rebates from Other Synthetic underlying Transaction Operating AMC expenses expense ratio funds costs Charges Date (%) (%) (%) (%) (%) (%) 30/09/17 Share Class E Elite Share Class Elite Institutional Share Class Elite Retail Share Class E WAY Share Class S WAY Share Class T WAY Share Class WAY Retail /03/17 Share Class E Elite (0.01) Share Class Elite Institutional (0.01) Share Class Elite Retail (0.01) Share Class E WAY (0.01) Share Class S WAY (0.01) Share Class T WAY (0.01) Share Class WAY Retail (0.01) The Operating Charge is the total expenses paid by the Fund in the period, annualised, against its average Net Asset Value. This will fluctuate as underlying costs change. The Fund has invested in Collective Investment Schemes during the period and the expenses incurred by these schemes are included in the above as the Synthetic expense ratio. Risk Warning An investment in an Open-Ended Investment Company should be regarded as a medium to long term investment. Investors should be aware that the price of Shares and the income from them may fall as well as rise and investors may not receive back the full amount invested. Past performance is not a guide to future performance. Investments denominated in currencies other than the base currency of a fund are subject to fluctuation in exchange rates, which may be favourable or unfavourable. 17

18 WAY Green Portfolio Fund Portfolio Statement As at 30 September 2017 (unaudited) Holdings or Nominal Market value % of Total Value Investments Net Assets Asia 5.26% [5.01%] Collective Investment Schemes 5.26% [5.01%] 193,144 Impax Asian Environmental Markets (Ireland) 276, , Brazil 0.00% [0.00%] Collective Investment Schemes 0.00% [0.00%] 2,005 Quadris Environmental Forestry Europe 3.16% [2.73%] Investment Companies 3.16% [2.73%] 45,760 TR Property 165, , Global 49.43% [55.56%] Collective Investment Schemes 45.48% [51.84%] 182,325 FP WHEB Sustainability 362, ,917 Henderson Global Care Growth 353, ,570 ishares Global Water 585, ,213 Julius Baer Multipartner - RobecoSAM Smart Materials 385, ,000 Jupiter Ecology 377, ,468 Pictet Clean Energy 320, ,384, Investment Companies 3.95% [3.72%] 86,713 Impax Environmental Markets 207, , United Kingdom 29.86% [32.54%] Collective Investment Schemes 18.05% [17.12%] 231,477 Kames Ethical Equity 371, ,149 Rathbone Ethical Bond 286, ,407 Unicorn UK Ethical Incomev 287, , Fixed Interest 11.81% [11.88%] 372,450 UK Gilt Inflation Linked 0.125% 22/03/ , ,602 United Kingdom Gilt 2.75% 07/09/ , , Real Estate Investment Trusts 3.86% [3.54%] 54,178 Secure Income REIT 202, , United States of America 3.72% [0.00%] Collective Investment Schemes 3.72% [0.00%] 2,275 ishares JPMorgan $ Emerging Markets Bond 194, ,

19 WAY Green Portfolio Fund Portfolio Statement (continued) As at 30 September 2017 (unaudited) Holdings or Nominal Market value % of Total Value Investments Net Assets Portfolio of investments 4,996, Net other assets 247, Net assets 5,243, All investments are Collective Investment Schemes unless otherwise stated. Comparative figures shown above in square brackets relate to 31 March Gross purchases for the six months: 199,006 [2016: 527,637]. Total sales net of transaction costs for the six months: 472,765 [2016: 560,705]. 19

20 WAY Green Portfolio Fund Statement of Total Return For the six months ended 30 September 2017 (unaudited) 01/04/17 to 30/09/17 01/04/16 to 30/09/16 Income Net capital gains 200, ,465 Revenue 50,178 18,185 Expenses (42,254) (39,039) Interest payable and similar charges - - Net revenue/(expense) before taxation 7,924 (20,854) Taxation - - Net revenue/(expense) after taxation 7,924 (20,854) Total return before distributions 208, ,611 Distributions (1,041) 1 Change in net assets attributable to Shareholders from investment activities 207, ,612 Statement of Change in Net Assets Attributable to Shareholders For the six months ended 30 September 2017 (unaudited) 01/04/17 to 30/09/17 01/04/16 to 30/09/16 Opening net assets attributable to Shareholders 5,273,998 4,793,183 Amounts received on issue of Shares 883, ,807 Less: Amounts paid on cancellation of Shares (1,121,108) (271,534) (237,782) 66,273 Dilution adjustment charged Change in net assets attributable to Shareholders from investment activities (see above) 207, ,612 Closing net assets attributable to Shareholders 5,243,807 5,576,068 The above statement shows the comparative closing net assets at 30 September 2016 whereas the current accounting period commenced 1 April

21 WAY Green Portfolio Fund Balance Sheet As at 30 September 2017 (unaudited) 30/09/17 31/03/17 Assets Fixed assets: Investment assets 4,996,628 5,054,480 Current assets: Debtors 8,159 11,584 Cash and bank balances 257, ,593 Total current assets 265, ,177 Total assets 5,261,842 5,294,657 Liabilities Creditors: Other creditors (18,035) (20,659) Total creditors (18,035) (20,659) Total liabilities (18,035) (20,659) Net assets attributable to Shareholders 5,243,807 5,273,998 21

22 WAY MA Cautious Portfolio Fund Investment Manager s Report For the six months ended 30 September 2017 (unaudited) Investment Objective The objective of the Fund is to seek capital growth, achieved through investment in a portfolio of Collective Investment Schemes, investment trusts, other transferable securities including listed securities, cash or near cash, deposits and money market instruments. Investment Policy Subject to the requirements of the Regulations, the portfolio will normally remain fully invested. There will, however, be no restrictions on the underlying content of the investments held, in terms of investment type, geographical or economic sector, other than those imposed by the Regulations, meaning that the investment adviser has the absolute discretion to weight the portfolio towards any investment type or sector, including cash, at any time. The Fund may also invest in unregulated Collective Investment Schemes (where investment in such funds is consistent with the investment objective and policy of the Fund). The portfolio will be actively managed. The use of derivatives and/or hedging transactions will be permitted in connection with the efficient portfolio management of the Fund. Borrowing will be permitted in accordance with the Regulations. On giving 60 days notice to Shareholders, the Fund may, in addition to its other investment powers, use derivatives and forward transactions for investment purposes. It is not intended that the use of derivatives in this way will change the risk profile of the Fund. Subject to the above, the Fund may invest in any asset class and adopt any investment technique or strategy permitted under the rules in COLL as such rules are applied to Non-UCITS retail schemes. Investment Review The WAY MA Cautious portfolio rose 1.08% over the six months to 30 September 2017 while the IA Mixed Investment 20-60% Shares Index rose 1.72%. Brompton Asset Management assumed responsibility for managing the WAY MA Cautious Portfolio on the 1st of May Subsequently, risk was slightly reduced through the disposal of the portfolio s investments in US equities on valuation concerns following strong market returns as well as in UK equities on concerns for the impact of sterling strength as the UK election date nears. Concerns on the strength of the US dollar also led to the sale of the Goldman Sachs USD Liquid Reserves fund to reduce the overall dollar exposure in the portfolio. Changes were also made over the course of May and June in European equities with a reduction in the Jupiter European fund and the disposal of the JOHCM Continental European fund. These funds were replaced with the Fidelity Germany fund and the Schroder European fund, these preferred funds are expected to deliver increased performance given the improving economic conditions in Europe. In July, changes were made to reduce the high exposure to alternative investments in favour of exposure to fixed income. Adding fixed income exposure should provide a stable return while also providing a defensive aspect if inflation and interest rates do not rise. The addition of the sterling hedged Legal & General Global Inflation Linked Bond Index fund provide defensive positioning through their duration exposure while also benefitting from some inflation protection. The defensively managed Schroder Strategic Credit fund was bought to add a different source of return through taking some credit risk while not adding significantly to the overall portfolio duration. UK equities were reduced again in September on concerns for the impact of faster rate rises than the market expects. The sale of the Lindsell Train UK equity fund and the Old Mutual UK Alpha in favour of the more value focused Schroder Recovery should help improve performance if inflation and interest rates rise. In addition US exposure was altered to increase exposure to financials as these stocks also benefit from improved margins when interest rates rise. 22

23 WAY MA Cautious Portfolio Fund Investment Manager s Report (continued) For the six months ended 30 September 2017 (unaudited) Market Overview Inflation rose in the US, the UK and the eurozone during the half year under review. Inflation rose because price increases in 2016 in key industrial commodities such as oil were reflected in year-on-year comparisons. Some central banks have begun a slow process of tightening monetary policy. The Federal Reserve took the opportunity afforded by steady economic growth and rising inflation to increase interest rates to above 1% during the 6 months under review. The European Central Bank and the Bank of England left interest rates unchanged but investors are beginning to anticipate tighter monetary policy. The position of the eurozone countries improved over the period both in political terms following the elections of centrist candidates in France and Germany and from an economic standpoint. In the UK, Theresa May s election miscalculation led to the loss of the Conservatives majority. Brexit negotiations are underway. The UK s opening position has been more amenable than expected but the likely terms of any agreement remain unclear. In the US, investor optimism following Donald Trump s US presidential election victory evaporated as doubts about his ability to deliver his elections pledges increased. Outlook The outlook for inflation is likely to remain a major theme for investors. Equities and other real assets should benefit if inflation continues to rise slowly from subdued levels and the pace of monetary tightening is slow. In this environment, longer-duration assets such as longer-dated bonds could post losses. Some equity markets ended the half year under review trading on undeniably-high valuations compared to history although more lowly-valued market areas where monetary policy was accommodative such as Europe excluding the UK, emerging markets and Japan have the potential for further significant gains. Equities could prove vulnerable if inflation rises rapidly and triggers tighter-than-expected monetary policies. On balance, this environment of high equity valuations, moderate economic growth and low inflation may persist for some time. In the UK and the eurozone, stronger manufacturing performance was offset to an extent by a consumer spending squeeze as a result of higher inflation. Wage growth remained weak while import prices had risen as a result of rising prices for oil and other commodities. In the UK, the falling pound added to the pressure on real wages. In the early autumn of 2017, consumers had not significantly reined in their spending, leading to a fall in the savings ratio. The consumption growth slowdown may prevent overall economic growth from accelerating but this may not deter central banks from raising interest rates. In the US, investor optimism following Trump s US presidential election victory evaporated. His policies of tax cuts, increased infrastructure spending and a reduction in the regulatory burden on businesses should prove strongly expansionary at a time when the economy is already growing steadily. In August 2017, president Trump s failure to repeal Obamacare to fund fiscal stimulus had, however, cast doubt on his ability to deliver his election pledges. The threat of impeachment and rising tension with North Korea created further political uncertainty. Prices have risen but wage growth in early autumn 2017 remained conspicuously subdued despite US and UK unemployment falling to historically low levels. There was much debate on the reason for workers apparent lack of bargaining power. Commentators attributed the lack of wage pressure to factors such as greater selfemployment and less unionisation and the rise in technology. The non-equity investments in the portfolio should provide diversification and may prove defensive should the rise in inflation falters. Investment Manager Brompton Asset Management LLP 22 November

24 WAY MA Cautious Portfolio Fund Net Asset Value per Share and Comparative Table As at 30 September 2017 (unaudited) Net Asset Value Date Net Asset Value of Net Asset Value Percentage Share Class ( ) Shares in issue pence per Share Change (%) Share Class B Retail Accumulation 31/03/17 1,706,114 1,116, /09/17 1,661,761 1,071, Share Class B Retail Income 31/03/17 12,892,142 8,443, /09/17 12,741,464 8,226, Share Class E Accumulation 31/03/17 65,663 49, /09/17 65,719 48, Share Class E Income 31/03/17 339, , /09/17 1,449,194 1,085, Share Class S Income 31/03/17 4,349,054 3,621, /09/17 4,643,462 3,802, Share Class T Income 31/03/17 8,246,660 6,363, /09/17 8,267,493 6,282, Distribution The Fund distributes annually, following the annual accounting period. Therefore there is no distribution in the current period. 24

25 WAY MA Cautious Portfolio Fund Performance Information As at 30 September 2017 (unaudited) Operating Charges Other Synthetic Transaction Operating AMC expenses expense ratio costs Charges Date (%) (%) (%) (%) (%) 30/09/17 Share Class B Share Class E Share Class S Share Class T /03/17 Share Class B Share Class E Share Class S Share Class T The Operating Charge is the total expenses paid by the Fund in the period, annualised, against its average Net Asset Value. This will fluctuate as underlying costs change. The Fund has invested in Collective Investment Schemes during the period and the expenses incurred by these schemes are included in the above as the Synthetic expense ratio. Risk Warning An investment in an Open-Ended Investment Company should be regarded as a medium to long term investment. Investors should be aware that the price of Shares and the income from them may fall as well as rise and investors may not receive back the full amount invested. Past performance is not a guide to future performance. Investments denominated in currencies other than the base currency of a fund are subject to fluctuation in exchange rates, which may be favourable or unfavourable. 25

26 WAY MA Cautious Portfolio Fund Portfolio Statement As at 30 September 2017 (unaudited) Holdings or Nominal Market value % of Total Value Investments Net Assets Asia 9.60% [9.71%] Collective Investment Schemes 9.60% [9.71%] 36,395 Baillie Gifford Japanese 549, ,000 Fidelity Index Pacific ex Japan 742, ,560 Man GLG Japan CoreAlpha Equity 1,051, ,600 Vanguard Pacific Ex-Japan Stock Index 421, ,766, Emerging Markets 8.54% [2.69%] Collective Investment Schemes 8.54% [2.69%] 210,000 Fidelity Index Emerging Markets 314, ,344 Goldman Sachs Emerging Markets Equity 1,036, ,415 Man GLG Global Emerging Markets Debt Total Return 1,111, ,462, Europe 29.62% [21.74%] Collective Investment Schemes 29.62% [21.74%] 1,165,000 BNY Mellon Absolute Return Equity 1,427, ,943 Fidelity Germany 1,162, ,236 Fidelity Index Europe ex UK 1,385, ,348 Schroder European 1,771, ,170 Schroder International Selection Strategic Credit 2,791, ,537, Global 15.61% [16.27%] Collective Investment Schemes 13.24% [13.82%] 530,000 Absolute Insight Credit ('B1p') 1,134, ,000 Absolute Insight Credit ('B2p2') 995, ,051 Goldman Sachs Sterling Liquid Reserve 551, ,161,956 Legal & General Global Inflation Linked Bond Index 1,135, ,816, Investment Companies 2.37% [2.45%] 744 FRM Credit Alpha ,700 International Oil and Gas Technology ,000 JPMorgan Private Equity 682, , United Kingdom 19.54% [30.83%] Collective Investment Schemes 19.52% [26.97%] 438,000 CF Lindsell Train UK Equity 1,217, ,108,807 Fidelity Index UK 1,420, ,000 Henderson UK Absolute Return 824, ,000 Jupiter Growth & Income 858, ,372,321 Schroder Recovery 1,307, ,627, Investment Companies 0.02% [3.86%] 12,790 Better Capital 6, ,

27 WAY MA Cautious Portfolio Fund Portfolio Statement (continued) As at 30 September 2017 (unaudited) Holdings or Nominal Market value % of Total Value Investments Net Assets United States of America 3.98% [18.22%] Collective Investment Schemes 3.98% [18.22%] 179,650 AXA Framlington American Growth 434, ,752 SPDR S&P US Financials Select Sector 714, ,148, Portfolio of investments 25,048, Net other assets 3,780, Net assets 28,829, Priced by the Fair Value Pricing Committee of the ACD on a Fair Value Price basis. All investments are Collective Investment Schemes unless otherwise stated. Comparative figures shown above in square brackets relate to 31 March Gross purchases for the six months: 13,424,840 [2016: 3,422,768]. Total sales net of transaction costs for the six months: 16,402,639 [2016: 3,920,797]. 27

28 WAY MA Cautious Portfolio Fund Statement of Total Return For the six months ended 30 September 2017 (unaudited) 01/04/17 to 30/09/17 01/04/16 to 30/09/16 Income Net capital gains 513,145 2,052,504 Revenue 118,381 98,515 Expenses (208,753) (187,355) Interest payable and similar charges - (166) Net expense before taxation (90,372) (89,006) Taxation - - Net expense after taxation (90,372) (89,006) Total return before distributions 422,773 1,963,498 Distributions 222 (19) Change in net assets attributable to Shareholders from investment activities 422,995 1,963,479 Statement of Change in Net Assets Attributable to Shareholders For the six months ended 30 September 2017 (unaudited) 01/04/17 to 30/09/17 01/04/16 to 30/09/16 Opening net assets attributable to Shareholders 27,598,826 24,557,987 Amounts received on issue of Shares 1,508, ,907 Less: Amounts paid on cancellation of Shares (701,192) (1,070,628) 807,272 (254,721) Change in net assets attributable to Shareholders from investment activities (see above) 422,995 1,963,479 Closing net assets attributable to Shareholders 28,829,093 26,266,745 The above statement shows the comparative closing net assets at 30 September 2016 whereas the current accounting period commenced 1 April

29 WAY MA Cautious Portfolio Fund Balance Sheet As at 30 September 2017 (unaudited) 30/09/17 31/03/17 Assets Fixed assets: Investment assets 25,048,449 27,449,051 Current assets: Debtors 3,240,523 3,538 Cash and bank balances 3,062, ,487 Total current assets 6,302, ,025 Total assets 31,351,061 27,660,076 Liabilities Creditors: Distribution payable on income Shares - (5,895) Other creditors (2,521,968) (55,355) Total creditors (2,521,968) (61,250) Total liabilities (2,521,968) (61,250) Net assets attributable to Shareholders 28,829,093 27,598,826 29

30 WAY MA Portfolio General Information Classes of Shares The Company can issue different classes of Shares in respect of any Fund. Holders of Income Shares are entitled to be paid the revenue attributable to such Shares, in respect of each annual accounting period. Holders of Accumulation Shares are not entitled to be paid the revenue attributable to such Shares, but that revenue is retained and accumulated for the benefit of Shareholders and is reflected in the price of Shares. Buying and Selling Shares The ACD will accept orders to deal in the Shares on normal business days between 9.00 am and 5.00 pm. Instructions to buy or sell Shares should be in writing to: WAY Fund Managers Limited - Cedar House, 3 Cedar Park, Cobham Road, Wimborne, Dorset BH21 7SB. A contract note will be issued by close of business on the next business day after the dealing date to confirm the transaction. Valuation Point The valuation point for the Fund is 12 noon on each dealing day (being each day which is a business day in London). Valuations may be made at other times under the terms contained within the Prospectus. Prices The prices of Shares for each class in the Fund will be posted via a link on (Financial Express). Report The annual report of the Company will normally be published within two months of each annual accounting period, although the ACD reserves the right to publish the annual report at a later date but not later than four months from the end of each annual accounting period. Interim Financial Statements period ended: Annual Financial Statements year ended: 30 September 31 March Distribution Payment Dates Interim Annual Not applicable, as the Funds distribute annually 31 May 30

31 WAY MA Portfolio General Information (continued) Significant Information Under the Alternative Investment Fund Managers Directive ("AIFMD"), acting as the Alternative Investment Fund Manager ("AIFM"), WAY Fund Managers Limited is required to disclose how those whose actions have a material impact on the Funds are remunerated. The remuneration strategy across WAY Fund Managers Limited is governed by the Remuneration Committee, a committee appointed by the WAY Fund Managers Limited' Board. The Remuneration Committee has established an AIFM Remuneration Policy designed to ensure the AIFM Remuneration Code in the UK Financial Authority handbook is met proportionately for all AIFM Remuneration Code Staff. WAY Fund Managers Limited considers its activities as non complex due to the fact that regulation limits the AIF strategies conducted and the scope of investment in such a way that investor risk is mitigated. The discretion of WAY Fund Managers Limited and the portfolio manager is strictly controlled within certain pre-defined parameters as determined in the prospectus of each Alternative Investment Fund. In its role as an AIFM, WAY Fund Managers Limited deems itself as lower risk due to the nature of the activities it conducts. WAY Fund Managers Limited does not pay any form of variable remuneration currently. Therefore WAY Fund Managers Limited has provided a basic overview of how staff whose actions have a material impact on the Funds are remunerated. Number of Beneficiaries Total remuneration paid Fixed remuneration Variable remuneration paid Carried interest paid by the AIF September 17 Total remuneration paid by WAY during the financial year , , Remuneration paid to employees of WAY who have a material impact on the risk profile of the AIF 7 57,960 57, Due to the size and structure of WAY Fund Managers Limited, it is determined that employees of the AIFM who have a material impact on the risk profile of the AIF include the Board, Director of Clint Relations and Product Management and the Head of Finance. The delegated investment manager is subject to regulatory requirements on remuneration that WAY Fund Managers Limited deem to be equally as effective as those detailed in the AIFMD, which would include the Capital Requirements Directive or Markets in Financial Instruments Directive. From 1 April 2017 Financial Advisors to Consultant Engineers and Technologists Limited (FACET) became the delegated IM for the WAY Absolute Return Portfolio Fund. With effect from 30 April 2017, Brompton Asset Management LLP was appointed by WAY Fund Managers Limited as Investment Manager to the WAY MA Cautious Portfolio Fund. 31