BMO INVESTMENTS (IRELAND) PLC (an investment company with variable capital incorporated with limited liability in Ireland with registered number

Transcription

1 BMO INVESTMENTS (IRELAND) PLC (an investment company with variable capital incorporated with limited liability in Ireland with registered number and operating as an umbrella fund with segregated liability between sub-funds pursuant to the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011, as amended. Interim Report and Condensed Unaudited Financial Statements for the six months ended 30 June 2017

2 Contents Directory 1 Page General Information 2 Investment Manager s Reports 3 Condensed Unaudited Financial Statements: Condensed Statement of Financial Position 8 Condensed Statement of Comprehensive Income 12 Condensed Statement of Changes in Net Assets Attributable to Holders of Redeemable Participating Shares 16 Condensed Statement of Cash Flows 20 Notes to the Condensed Unaudited Financial Statements 24 Schedule of Investments BMO Global Low Volatility Alpha Equity 42 Asia Pacific ex-japan Equity 51 Global Total Return (Sterling) 53 Global Equity (US$) 57 International (EAFE) Equity 60 Shariah Global Equity 63 Global Total Return (Euro) 66 Global Equity (Sterling) 70 Global Equity (Euro) 74 Statements of Significant Changes on Composition of Portfolio 78

3 Directory DIRECTORS Eimear Cowhey (Irish)ǂ Liam Miley (Irish)ǂ Hugh Moir (British)* Lars Nielsen (Danish) Drew Newman (British) Stuart Woodyatt (British)** ǂIndependent Directors *Resigned 3 April 2017 **Appointed 3 April 2017 ADMINISTRATOR State Street Services (Ireland) Limited 78 Sir John Rogerson s Quay Dublin 2 Ireland DEPOSITARY State Street Custodial Services (Ireland) Limited 78 Sir John Rogerson s Quay Dublin 2 Ireland REGISTERED OFFICE 78 Sir John Rogerson s Quay Dublin 2 Ireland INDEPENDENT AUDITOR KPMG 1-2 Harbourmaster Place International Financial Services Centre Dublin 1 Ireland INVESTMENT MANAGER International Ltd. 95 Wigmore Street London W1U 1FD United Kingdom SUB-INVESTMENT MANAGERS Monegy, Inc.* 100 King Street West 42 nd Floor First Canadian Place Toronto Ontario M5X 1A1 Canada *Appointment terminated on 27 July 2017 BMO Asset Management Corp 1209 Orange Street Wilmington New Castle DE USA LEGAL ADVISOR Arthur Cox Ten Earlsfort Terrace Dublin 2 Ireland COMPANY SECRETARY Bradwell Limited Ten Earlsfort Terrace Dublin 2 Ireland GOVERNANCE SERVICE PROVIDER KB Associates 5 George s Dock IFSC Dublin 1 Ireland REGISTRATION NUMBER

4 General Information The following information is derived from and should be read in conjunction with the full text and definitions section of the prospectus of BMO Investments (Ireland) plc dated 27 January 2016 (the Prospectus ). Capitalised terms used but not defined herein shall have the meaning ascribed thereto in the Prospectus. BMO Investments (Ireland) plc (the Company ), was incorporated on 5 March 2007 and operates in Ireland as a public limited company pursuant to the Companies Act 2014, as amended and the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011, as amended (the UCITS Regulations ). The Company was initially authorised by the Central Bank of Ireland (the Central Bank ) as a non-ucits qualifying investor fund on 2 May 2007 and effective 30 June 2011 has been authorised by the Central Bank pursuant to the UCITS Regulations. The Company is organised in the form of an umbrella fund with segregated liability between sub-funds (each a Sub-, collectively the Sub-s ). The Company may offer separate classes of shares, each representing interests in a Sub-. The Company may create additional Sub-s and issue multiple classes of shares in respect of each Sub- provided they are effected in accordance with the requirements of the Central Bank. As at 30 June 2017 there were thirteen Sub-s authorised for investment namely: Asia Pacific ex-japan Equity Global Total Return (Euro) Global Equity (US$) International (EAFE) Equity Shariah Asia Pacific ex-japan Equity Shariah Global Equity Monegy Global High Yield Bond * Global Total Return (Sterling) BMO Short Duration US Dollar BMO Global Low Volatility Alpha Equity Global Equity (Sterling) Global Equity (Euro) Global Total Return (US$) ** *This Sub- was fully redeemed during the financial year ended 31 December **This Sub- was fully redeemed during the financial period ended 30 June As at 30 June 2017 nine Sub-s had been launched and in operation namely: Sub-s BMO Global Low Volatility Alpha Equity Asia Pacific ex-japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity Shariah Global Equity Global Total Return (Euro) Global Equity (Sterling) Global Equity (Euro) Benchmark MSCI All Country World Index MSCI All Country (AC) Asia Pacific Ex Japan Index SM n/a MSCI World Index SM MSCI EAFE Index SM S&P Global BMI Shariah Index n/a MSCI World Index SM MSCI World Index SM Global Total Return (US$) was fully redeemed during the financial period ended 30 June Reporting to investors UK Reporting Regime It is the intention of each launched Sub- to continue to meet its annual obligations to be a reporting fund, as defined in the Offshore s (Tax) Regulations 2009 (SI 2009 No. 3001). The Sub- will report income to investors via the Company s website at and this is expected to be made available to investors by 30 June in each year. 2

5 Investment Manager s Report Macro-Economic Backdrop Investors nervousness is symptomatic of concerns on capital market valuations which have been driven to excessive levels by the tsunami of liquidity that has been released over the last 8 years by the major central banks of the world. This quantitative easing or money printing has been very successful in inflating asset prices but has been unsuccessful at generating real economic growth. Output growth is fundamentally driven by labour force growth plus productivity and in much of the developed world this is not a rosy picture. No amount of money printing can change this. What it has achieved is the misallocation of funds as borrowers assume that the free ride of effectively zero interest rates will persist indefinitely. Low rates have encouraged an explosion in borrowing, much in US dollars, on the expectation of loose monetary conditions far into the future. Severe imbalances have developed in emerging markets, especially in Turkey, Eastern Europe, Brazil and South Africa. The rally in the US dollar has already increased the stress in this situation considerably; potential rises in the cost of credit through Federal Reserve tightening will only serve to make this worse. The global bond markets have provided exceptional performance as interest rates have been driven down partly because of the liquidity being poured into the system and partly because of a lack of alternatives. Yields remain at artificially low levels and continue to offer extremely poor value relative to the outlook for inflation. Rises in inflation expectations towards the end of 2016 saw yields widen, nonetheless valuations remain expensive. One of the key market debates centres on inflation and the impact it may have on asset prices and official interest rates. There is no denying the figures inflation has moved into positive territory in all nineteen Eurozone countries, has passed the 2% target in the UK and US, is now above zero in Japan and is tending to gradually nudge up elsewhere. We expect it to remain modestly firm. On the basis of past central bank pronouncements there is little doubt (in our mind) that official rates should be climbing. If inflation and employment targets have been met and the world economy remains in a gentle cyclical upswing there should be nothing to prevent interest rate action. The US Federal Reserve raised its key interest rate for the third time in six months to a range of between 1% and 1.25%. The Fed advised that another two rate increases could occur this year whilst also announcing an increase in its GDP growth forecast (to 2.2% this year). Ironically, within two weeks of the Fed announcement indications of a cooling in US growth and inflation both occurred. Even the IMF has now started lowering its US growth forecasts. European politics dominated the news in the quarter the French Presidential and parliamentary elections and the British election. In both cases the circumstances and the outcomes surrounding these events could barely have been imagined just a year ago. In the case of France we have a new President who only formed his centrist political party in April 2016 and went on to win the parliamentary elections held in June virtually wiping out the socialists. In the UK, Theresa May gambled on an early election to endeavour to win a powerful mandate. This, she hoped, would give her a stronger hand when dealing with the rest of the EU over Brexit. It backfired badly. Support for the Labour opposition mounted during the campaign weeks and votes from several of the minor parties flowed into Labour s hands. Portfolio Positioning BMO Global Low Volatility Alpha Equity The portfolio positioning is determined on an absolute basis without respect to benchmark weights, with the objective of investing in a highly diversified, low risk portfolio with a meaningful potential for excess returns. The portfolio is thus invested in a combination of low risk securities, low correlation securities, and high return potential securities. The ideal security for the portfolio represents all three attributes. Thematically, the portfolio positioning is best described by its sector allocation globally. While portfolio weights are determined irrespective of benchmark weight, the resulting portfolio is overweight in low volatility segments of the economy, including Health Care, Utilities, Consumer Staples, and Telecommunication Services. The portfolio is underweight higher volatility segments of the economy, including Information Technology, Consumer Discretionary, and Materials. 3

6 Investment Manager s Report cont/d Portfolio Positioning cont/d BMO Global Low Volatility Alpha Equity cont/d Geographically, the portfolio is diversified across 25 countries, including both Developed and Emerging Markets. The largest overweights are in Hong Kong, Singapore, New Zealand, and Malaysia. The biggest underweights are in the United Kingdom, United States, France, Germany, and Australia. Neutral yet meaningful weights in absolute terms are in Japan and Switzerland. Looking ahead, historically low levels of risk coupled with low correlations make active stock selection even more important in the context of low volatility investing. As such, we are avoiding stocks that appear to be low risk as a result of the market environment, while identifying companies that have high quality fundamental characteristics. Furthermore, we find the relative valuations of low risk stocks compared to high risk stocks to be neutral to attractive in many countries around the world, as we avoid low risk stocks that trade very expensively compared to their higher risk peers. And finally, we continue to identify many attractive portfolio candidates with a combination of low risk, low correlation, and high return potential within our 7,000 stock universe. Performance in USD (Periods longer than one year are annualized): 1 Month 3 Month 6 Months 1 Year Since 1/1/2014 (Gross) 0.43% 3.75% 9.10% 8.37% 8.55% MSCI ACWI 0.50% 4.45% 11.82% 19.42% 6.50% Asia Pacific ex-japan Equity (USD) The fund returned 11.00%, versus the MSCI AC Asia Pacific ex Japan Index return of 19.93%. The portfolio is overweight in Australia, Malaysia, Singapore and Taiwan. It is correspondingly underweight in China, India and Korea. The equity portfolio is defensively positioned with underweight positions in banks and a zero weighting in real estate which remains overvalued throughout much of the region. The portfolio is also underweight the materials and consumer discretionary sectors. Overweight positions are held in industrials and telecommunications which offer more predictable revenue streams and attractive valuations. The focus of the portfolio is on balance sheet strength, profitability, earnings visibility and value. Global Total Return (Sterling) The fund returned 1.95%. The asset allocation of the portfolio remains defensive. The model allocation is: fixed income 67%, equities 30% and cash 3%. In fixed income markets real yields remain low despite the recent widening. continues to adopt a defensive stance by owning short duration securities in order to protect the capital value of the portfolio from further rises in yields. The target modified duration of the fixed income portfolio is approximately 2 years. Currently, we own high quality UK, Australian and Canadian sovereign debt having sold our US Treasury holdings due to heightened currency risk. The equity portfolio remains defensively positioned with a greater exposure to consumer staples and health care sectors over consumer discretionary and materials. We retain our zero weighting in UK and European banks. In line with s purchasing power parity analysis, the Swiss Franc, the Canadian Dollar and Australian Dollar exposure within the portfolio remains fully hedged. These currencies are overvalued versus sterling and the hedging position helps protect the portfolio against any fall in their value. 4

7 Investment Manager s Report cont/d Portfolio Positioning cont/d Global Equity (US$) The fund returned 12.36%, versus the MSCI World Index return of 11.02%. The portfolio remains overweight the Asia ex-japan region and underweight the QE-driven markets of Japan, the Eurozone and the US. We are underweight the US as we view the market as overvalued. The companies we do hold are defensive names, which we would expect to perform well during volatile periods. Within Europe there are no holdings in the peripheral Eurozone countries where sovereign debt concerns remain. The European portfolio is concentrated in Switzerland and the relatively healthy economies of core Europe. We remain underweight the UK due to concerns over the impact much needed deleveraging will have on the UK economy. In Asia, we have a preference for the Southeast Asian markets over Japan. The potential growth rate in Japan remains low given the poor demographics and low productivity growth. Economies in Southeast Asia offer sustainable economic growth supported by increased labour output or productivity growth and trade at more reasonable valuations. In terms of sectors, the portfolio is very defensively positioned with underweight exposure to cyclical sectors. Overweight sectors include consumer staples, industrials and telecommunications which offer high dividend yields and visible earnings streams. International (EAFE) Equity (USD) The fund returned 11.98%, versus the MSCI EAFE Index return of 14.23%. The portfolio remains defensively positioned with an underweight to the QE fuelled markets and an overweight to the Southeast Asian markets. The European portfolio is concentrated in Switzerland and the relatively healthy economies of core Europe. Economies in Southeast Asia offer sustainable economic growth supported by increased labour output or productivity growth and trade at more reasonable valuations. We remain underweight to Japan as the potential economic growth rate remains low given the poor demographics and low productivity growth. In terms of sectors, we have limited exposure to more cyclical sectors such as financials and consumer discretionary. Overweight positions are held in defensive sectors such as utilities, industrials and telecommunications. These sectors offer predictable revenue streams and attractive valuations. The focus of the portfolio is on balance sheet strength, profitability, earnings visibility and value. Shariah Global Equity (USD) The fund returned 13.57%, versus the S&P Global BMI Shariah Index return of 13.49%. The portfolio remains overweight the Asia ex-japan region and underweight the QE-driven markets of Japan and the US. We are underweight the US as we view the market as overvalued. The companies we do hold are defensive names, which we would expect to perform well during volatile periods. Within Europe there are no holdings in the peripheral Eurozone countries where sovereign debt concerns remain. The European portfolio is concentrated in Switzerland and the relatively healthy economies of core Europe. In Asia, we have a preference for the Southeast Asian markets over Japan. The potential growth rate in Japan remains low given the poor demographics and low productivity growth. Economies in Southeast Asia offer sustainable economic growth supported by increased labour output or productivity growth and trade at more reasonable valuations. In terms of sectors, the portfolio is very defensively positioned with underweight exposure to cyclical sectors. Overweight sectors include telecommunications and industrials which offer high dividend yields and visible earnings streams. 5

8 Investment Manager s Report cont/d Global Total Return (Euro) The fund returned 0.85%. The asset allocation of the portfolio remains defensive. The model allocation is: fixed income 62%, equities 35% and cash 3%. In fixed income markets real yields remain low despite the recent widening. continues to adopt a defensive stance by owning short duration securities in order to protect the capital value of the portfolio from further rises in yields. The target modified duration of the fixed income portfolio is approximately 2 years. Currently, we own high quality German, Canadian, US and UK sovereign debt. The equity portfolio remains defensively positioned with a greater exposure to consumer staples and telecommunication sectors over consumer discretionary and financials. We retain our zero weighting in UK and European banks. Global Equity (Sterling) The fund returned 6.61%, versus the MSCI World Index return of 5.61%. The portfolio remains overweight the Asia ex-japan region and underweight the QE-driven markets of Japan, the Eurozone and the US. We are underweight the US as we view the market as overvalued. The companies we do hold are defensive names, which we would expect to perform well during volatile periods. Within Europe there are no holdings in the peripheral Eurozone countries where sovereign debt concerns remain. The European portfolio is concentrated in Switzerland and the relatively healthy economies of core Europe. We remain underweight the UK due to concerns over the impact much needed deleveraging will have on the UK economy. In Asia, we have a preference for the Southeast Asian markets over Japan. The potential growth rate in Japan remains low given the poor demographics and low productivity growth. Economies in Southeast Asia offer sustainable economic growth supported by increased labour output or productivity growth and trade at more reasonable valuations. In terms of sectors, the portfolio is very defensively positioned with underweight exposure to cyclical sectors. Overweight sectors include consumer staples and telecommunications which offer high dividend yields and visible earnings streams. In line with s purchasing power parity analysis, the Swiss Franc, Canadian Dollar and Australian Dollar exposure within the portfolio remains fully hedged. These currencies are overvalued versus sterling and the hedging position insulates the portfolio against any fall in their value. Global Equity (EUR) The fund returned 4.30%, versus the MSCI World Index return of 2.67%. The portfolio remains overweight the Asia ex-japan region and underweight the QE-driven markets of Japan, the Eurozone and the US. We are underweight the US as we view the market as overvalued. The companies we do hold are defensive names, which we would expect to perform well during volatile periods. Within Europe there are no holdings in the peripheral Eurozone countries where sovereign debt concerns remain. The European portfolio is concentrated in Switzerland and the relatively healthy economies of core Europe. We remain underweight the UK due to concerns over the impact much needed deleveraging will have on the UK economy. In Asia, we have a preference for the Southeast Asian markets over Japan. The potential growth rate in Japan remains low given the poor demographics and low productivity growth. Economies in Southeast Asia offer sustainable economic growth supported by increased labour output or productivity growth and trade at more reasonable valuations. In terms of sectors, the portfolio is very defensively positioned with underweight exposure to cyclical sectors. Overweight sectors include consumer staples and telecommunications which offer high dividend yields and visible earnings streams. 6

9 Investment Manager s Report cont/d Investment Outlook Eight years on from the global financial crisis and it has been a distinctly sub-par performance in terms of real wages, consumption, employment, GDP, trade, capital investment and labour productivity. The easing cycle, propelled by extraordinary and unorthodox central bank actions, could normally be expected to stimulate global growth but this has not happened. It seems that the excessive levels of debt built up prior to the crisis, fragile banks and wounded confidence levels of corporates and consumers have been the main reasons. The excess liquidity created by central bank actions has clearly leaked into equity and bond markets, chasing asset prices higher. The 35 year-old bond bull market appears to be over. The forward-looking investment return from mid to long-dated securities is likely to be no greater than their market yield which remains at an extremely low level despite the recent increase. At the same time all of our normal valuation metrics indicate that equities are expensive. The economic cycle is mature and the monetary tightening process has commenced. Return on equity in the corporate sector has been relatively high but profit margins have started to narrow. Significant risks exist in global capital markets through elevated global debt levels, geo-political risks in Europe and as central banks ponder the timing and impact of policy rate hikes in some economies. These have the potential to deliver serious shocks to market sentiment and the real economy. Investment caution and defensive positioning is essential in this economic climate. If valuations were not already stretched a more aggressive investment posture could be justified but circumstances dictate otherwise. 7

10 Condensed Statement of Financial Position As at 30 June 2017 Total BMO Global Low Volatility Alpha Equity Asia Pacific ex- Japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity Note USD USD USD GBP USD USD Current Assets Financial assets at fair value through profit or loss: Transferable Securities 3,071,843,200 1,746,722 1,307,274 2,331,783,940 3,820,306 31,343,449 Financial derivative instruments 11,541, ,881, Deposits with credit institutions 4 156,946,012 39,957 58, ,586, ,672 1,138,471 Other receivables 63,812,752 52,278 12,406 48,919,704 17, ,361 Total Current Assets 3,304,143,065 1,838,957 1,377,956 2,509,171,538 3,970,893 32,643,281 Current Liabilities Financial liabilities at fair value through profit or loss: Financial derivative instruments (4,017) Other payables (4,336,113) (58,697) (30,982) (3,041,699) (35,863) (92,186) Total Current Liabilities excluding net assets attributable to holders of redeemable participating shares (4,340,130) (58,697) (30,982) (3,041,699) (35,863) (92,186) Net assets attributable to holders of Redeemable Participating Shares 3,299,802,935 1,780,260 1,346,974 2,506,129,839 3,935,030 32,551,095 The accompanying notes form an integral part of the condensed unaudited financial statements. 8

11 Condensed Statement of Financial Position As at 30 June 2017 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) * Global Equity (Sterling) Global Equity (Euro) Note USD EUR USD GBP EUR Current Assets Financial assets at fair value through profit or loss: Transferable Securities 2,087,149 2,629, , ,748 Financial derivative instruments - 1,266-7,155 3,210 Deposits with credit institutions 4 86, ,612 37,329 47,643 37,951 Other receivables 9,118 46, ,843 6,457 Total Current Assets 2,182,985 2,801,665 37,651 1,024, ,366 Current Liabilities Financial liabilities at fair value through profit or loss: Financial derivative instruments (3,095) - Other payables (30,796) (44,031) (37,651) (15,012) (28,559) Total Current Liabilities excluding net assets attributable to holders of redeemable participating shares (30,796) (44,031) (37,651) (18,107) (28,559) Net assets attributable to holders of Redeemable Participating Shares 2,152,189 2,757,634-1,006, ,807 *This Sub- was fully redeemed during the financial period ended 30 June The accompanying notes form an integral part of the condensed unaudited financial statements. 9

12 Condensed Statement of Financial Position As at 31 December 2016 Total BMO Global Low Volatility Alpha Equity Asia Pacific ex- Japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity Note USD USD USD GBP USD USD Current Assets Financial assets at fair value through profit or loss: Transferable Securities 2,806,590,892 1,615,887 1,201,092 2,252,763,009 3,328,293 19,589,500 Financial derivative instruments 10,490, ,523, Deposits with credit institutions 4 120,344,239 45,786 56,642 96,665, , ,301 Other receivables 30,802,771 32,419 1,211 24,037,193 1,010,876 50,519 Total Current Assets 2,968,228,885 1,694,092 1,258,945 2,381,988,978 4,441,632 20,473,320 Current Liabilities Financial liabilities at fair value through profit or loss: Financial derivative instruments (1,447,212) - - (1,173,013) (205) - Other payables (4,456,060) (51,149) (44,689) (2,492,990) (919,753) (66,555) Total Current Liabilities excluding net assets attributable to holders of redeemable participating shares (5,903,272) (51,149) (44,689) (3,666,003) (919,958) (66,555) Net assets attributable to holders of Redeemable Participating Shares 2,962,325,613 1,642,943 1,214,256 2,378,322,975 3,521,674 20,406,765 The accompanying notes form an integral part of the condensed unaudited financial statements. 10

13 Condensed Statement of Financial Position As at 31 December 2016 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) Monegy Global High Yield Bond * Global Equity (Sterling) Global Equity (Euro) Note USD EUR USD USD GBP EUR Current Assets Financial assets at fair value through profit or loss: Transferable Securities 1,901,001 2,626,356 2,961, , ,995 Financial derivative instruments ,141 - Deposits with credit institutions 4 42, ,869 98,376 65,951 31,944 25,563 Other receivables 7,776 56,411 33,268 11,168 10,514 11,815 Total Current Assets 1,950,847 2,792,636 3,092,854 77, , ,373 Current Liabilities Financial liabilities at fair value through profit or loss: Financial derivative instruments - (242) - - (2,486) (618) Other payables (44,592) (54,021) (73,443) (77,119) (19,483) (29,233) Total Current Liabilities excluding net assets attributable to holders of redeemable participating shares (44,592) (54,263) (73,443) (77,119) (21,969) (29,851) Net assets attributable to holders of Redeemable Participating Shares 1,906,255 2,738,373 3,019, , ,522 *The Sub- was fully redeemed during the financial year ended 31 December The accompanying notes form an integral part of the condensed unaudited financial statements. 11

14 Condensed Statement of Comprehensive Income For the six months ended 30 June 2017 Total BMO Global Low Volatility Alpha Equity Asia Pacific ex- Japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity Note USD USD USD GBP USD USD Income Investment Income 27,460,950 24,961 28,364 21,013,503 72, ,592 Net gain on investment activities 39,849, , ,298 28,805, ,444 2,756,509 Total investment income 67,310, , ,662 49,819, ,882 3,521,101 Operating expenses 6 (15,230,016) (96,181) (25,210) (11,729,399) (41,216) (205,801) Investment Management fee reimbursements 188,989 87,227 16,108-15,187 - Net Income 52,269, , ,560 38,089, ,853 3,315,300 Finance cost Distributions 11 (32,693,045) - - (25,907,091) (162,346) - Net Increase in net assets attributable to holders of redeemable participating shares before tax 19,576, , ,560 12,182, ,507 3,315,300 Withholding tax 2 (1,099,821) (4,538) (1,842) (794,728) (10,497) (70,970) Net increase in net assets attributable to holders of Redeemable Participating Shares resulting from operations 18,476, , ,718 11,387, ,010 3,244,330 All amounts arose from continuing operations apart from Global Total Return (US$) which was fully redeemed during the period ended 30 June There were no recognized gains or losses in the financial period other than those dealt with in the Condensed Statement of Comprehensive Income. The accompanying notes form an integral part of the condensed unaudited financial statements. 12

15 Condensed Statement of Comprehensive Income For the six months ended 30 June 2017 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) * Global Equity (Sterling) Global Equity (Euro) Note USD EUR USD GBP EUR Income Investment Income 34,218 48,230 57,276 17,787 17,113 Net gain/(loss) on investment activities 231,855 (10,602) 11,749 37,406 22,797 Total investment income 266,073 37,628 69,025 55,193 39,910 Operating expenses 6 (28,140) (35,767) (19,388) (18,639) (21,877) Investment Management fee reimbursements 13,973 19,576 2,952 12,179 15,731 Net Income 251,906 21,437 52,589 48,733 33,764 Finance cost Distributions Net Increase in net assets attributable to holders of redeemable participating shares before tax 251,906 21,437 52,589 48,733 33,764 Withholding tax 2 (5,972) (1,969) - (2,603) (2,479) Net increase in net assets attributable to holders of Redeemable Participating Shares resulting from operations 245,934 19,468 52,589 46,130 31,285 *This Sub- was fully redeemed during the financial period ended 30 June All amounts arose from continuing operations apart from Global Total Return (US$) which was fully redeemed during the period ended 30 June There were no recognized gains or losses in the financial period other than those dealt with in the Condensed Statement of Comprehensive Income. The accompanying notes form an integral part of the condensed unaudited financial statements. 13

16 Condensed Statement of Comprehensive Income For the six months ended 30 June 2016 Total BMO Global Low Volatility Alpha Equity Asia Pacific ex- Japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity Note USD USD USD GBP USD USD Income Investment Income 28,914,140 26,147 22,542 19,845,872 44, ,379 Net gains on investment activities 168,255,692 81,179 33, ,471,787 74,190 77,547 Total investment income 197,169, ,326 55, ,317, , ,926 Expenses Operating expenses 6 (16,819,853) (43,589) (42,753) (11,409,863) (53,891) (163,479) Investment Management fee reimbursements 262,797 35,394 34,999-37,310 - Net income 180,612,776 99,131 48, ,907, , ,447 Finance Costs Distributions 11 (1,223,424) - - (858,931) - - Taxation Withholding tax 2 (912,660) (4,363) (1,407) (596,816) (6,057) (37,038) Net increase in net assets attributable to holders of Redeemable Participating Shares resulting from operations 178,476,692 94,768 46, ,452,049 96, ,409 All amounts arose solely from continuing operations. There were no recognised gains or losses in the financial period other than those dealt with in the Condensed Statement of Comprehensive Income. The accompanying notes form an integral part of the condensed unaudited financial statements. 14

17 Condensed Statement of Comprehensive Income For the six months ended 30 June 2016 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) Monegy Global High Yield Bond * Global Equity (Sterling) Global Equity (Euro) Note USD EUR USD USD GBP EUR Income Investment Income 33,040 19,271 13, ,095 14,676 Net gains/(losses) on investment activities 61,668 (22,374) 56, ,461 67, Total investment income/(expense) 94,708 (3,103) 70, ,505 79,373 15,247 Expenses Operating expenses 6 (46,191) (52,731) (48,404) (76,317) (11,528) (16,814) Investment Management fee reimbursements 33,942 37,330 31,056 25,909 7,079 11,473 Net income/(expense) 82,459 (18,504) 53, ,097 74,924 9,906 Taxation Withholding tax 2 (5,241) (1,358) (1,798) (46) (1,861) (2,233) Net increase/(decrease) in net assets attributable to holders of Redeemable Participating Shares resulting from operations 77,218 (19,862) 51, ,051 73,063 7,673 *The Sub- was fully redeemed during the period year ended 31 December All amounts arose solely from continuing operations. There were no recognised gains or losses in the financial period other than those dealt with in the Condensed Statement of Comprehensive Income. The accompanying notes form an integral part of the condensed unaudited financial statements. 15

18 Condensed Statement of Changes in Net Assets Attributable to Holders of Redeemable Participating Shares For the six months ended 30 June 2017 BMO Global Low Volatility Alpha Equity Asia Pacific ex-japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity Note USD USD GBP USD USD Net assets attributable to holders of Redeemable Participating Shares at beginning of period 1,642,943 1,214,256 2,378,322,975 3,521,674 20,406,765 Net increase in net assets attributable to holders of Redeemable Participating Shares resulting from operations 137, ,718 11,387, ,010 3,244,330 Movement due to sales and repurchases of redeemable participating shares Net increase/(decrease) in net assets resulting from redeemable participating share transactions ,418, ,346 8,900,000 Net assets attributable to holders of Redeemable Participating Shares at end of period 1,780,260 1,346,974 2,506,129,839 3,935,030 32,551,095 The accompanying notes form an integral part of the condensed unaudited financial statements. 16

19 Condensed Statement of Changes in Net Assets Attributable to Holders of Redeemable Participating Shares For the six months ended 30 June 2017 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) * Global Equity (Sterling) Pyrfrod Global Equity (Euro) Note USD EUR USD GBP EUR Net assets attributable to holders of Redeemable Participating Shares at beginning of period 1,906,255 2,738,373 3,019, , ,522 Net increase in net assets attributable to holders of Redeemable Participating Shares resulting from operations 245,934 19,468 52,589 46,130 31,285 Movement due to sales and repurchases of redeemable participating shares Net increase/(decrease) in net assets resulting from redeemable participating share transactions 3 - (207) (3,072,000) 137,704 - Net assets attributable to holders of Redeemable Participating Shares at end of period 2,152,189 2,757,634-1,006, ,807 *This Sub- was fully redeemed during the financial period ended 30 June The accompanying notes form an integral part of the condensed unaudited financial statements. 17

20 Condensed Statement of Changes in Net Assets Attributable to Holders of Redeemable Participating Shares For the six months ended 30 June 2016 BMO Global Low Volatility Alpha Equity Asia Pacific ex-japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity Note USD USD GBP USD USD Net assets attributable to holders of Redeemable Participating Shares at beginning of period 1,552,089 1,108,907 2,206,506,411 2,359,323 20,140,567 Net increase/(decrease) in net assets attributable to holders of Redeemable Participating Shares resulting from operations 94,768 46, ,452,049 96, ,409 Movement due to sales and repurchases of redeemable participating shares Net decrease in net assets resulting from redeemable participating share transactions (25,915,913) - - Net assets attributable to holders of Redeemable Participating Shares at end of period 1,646,857 1,155,640 2,305,042,547 2,455,721 20,468,976 The accompanying notes form an integral part of the condensed unaudited financial statements. 18

21 Condensed Statement of Changes in Net Assets Attributable to Holders of Redeemable Participating Shares For the six months ended 30 June 2016 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) Monegy Global High Yield Bond * Global Equity (Sterling) Pyrfrod Global Equity (Euro) Note USD EUR USD USD GBP EUR Net assets attributable to holders of Redeemable Participating Shares at beginning of period 1,744,872 2,693,426 3,006,688 9,483, , ,603 Net increase/(decrease) in net assets attributable to holders of Redeemable Participating Shares resulting from operations 77,218 (19,862) 51, ,051 73,063 7,673 Movement due to sales and repurchases of redeemable participating shares Net increase in net assets resulting from redeemable participating share transactions ,637 - Net assets attributable to holders of Redeemable Participating Shares at end of period 1,822,090 2,673,564 3,058,200 9,910, , ,276 *The Sub- was fully redeemed during the financial year ended 31 December The accompanying notes form an integral part of the condensed unaudited financial statements. 19

22 Condensed Statement of Cash Flow For the six months ended 30 June 2017 BMO Global Low Volatility Asia Pacific ex- Global Total Global Equity International Alpha Equity Japan Return (Sterling) (US$) (EAFE) Equity Total Equity USD USD USD GBP USD USD Cash flows provided by/(used in) operating activities Net increase in net assets attributable to holders of redeemable participating shares 51,169, , ,718 37,294, ,356 3,244,330 Adjustments for: Movement in financial assets at fair value through profit or loss (110,439,843) (130,835) (106,182) (79,342,003) (1,367,062) (11,759,384) Unrealised movement on derivative assets and liabilities (1,931,025) - - (1,530,725) (142) - Operating cash flows before movements in working capital (61,201,602) 6,482 26,536 (43,577,739) (953,848) (8,515,054) Movement in other receivables (4,636,836) (19,859) (11,195) (3,642,029) (4,509) (83,278) Movement in other payables 179,989 7,548 (13,707) 237,645 (11,371) 3,502 Cash (outflow)/inflow from operations (4,456,847) (12,311) (24,902) (3,404,384) (15,880) (79,776) Net cash (outflow)/inflow from operating activities (65,658,449) (5,829) 1,634 (46,982,123) (969,728) (8,594,830) Cash flows from financing activities Proceeds from subscriptions 337,464, ,601,560 1,162,346 8,900,000 Payment of redemptions (209,967,243) - - (164,790,940) - - Distributions paid (32,693,045) - - (25,907,091) (162,346) - Net cash inflow from financing activities 94,804, ,903,529 1,000,000 8,900,000 Net increase/(decrease) in cash and cash equivalents 29,145,622 (5,829) 1,634 22,921,406 30, ,170 Cash and cash equivalents at the start of the financial period 120,344,239 45,786 56,642 96,665, , ,301 Foreign Currency Translation Adjustment 7,456,151 - Cash and cash equivalents at the end of the financial period 156,946,012 39,957 58, ,586, ,672 1,138,471 Cashflows from operating activities include: Taxation paid (977,111) (4,454) (826) (704,088) (9,529) (64,851) Interest received 40,177, ,972,478 (25) (45) Dividend received 24,119,261 23,766 22,367 18,502,116 65, ,693 Dividend paid (32,693,045) - - (25,907,091) (162,346) - The accompanying notes form an integral part of the condensed unaudited financial statements. 20

23 Condensed Statement of Cash Flow For the six months ended 30 June 2017 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) * Global Equity (Sterling) Global Equity (Euro) USD EUR USD GBP EUR Cash flows provided by/(used in) operating activities Net increase in net assets attributable to holders of redeemable participating shares 245,934 19,468 52,589 46,130 31,285 Adjustments for: Movement in financial assets at fair value through profit or loss (186,148) 3,661 2,961,210 (164,850) (19,583) Unrealised movement on derivative assets and liabilities - (1,508) - (2,405) (3,828) Operating cash flows before movements in working capital 59,786 21,621 3,013,799 (121,125) 7,874 Movement in other receivables (1,342) 11,008 32,946 4,236 5,848 Movement in other payables (13,796) (17,679) (63,570) (5,115) (1,334) Cash (outflow)/inflow from operations (15,138) (6,671) (30,624) (879) 4,514 Net cash inflow/(outflow) from operating activities 44,648 14,950 2,983,175 (122,004) 12,388 Cash flows from financing activities Proceeds from subscriptions ,802 - Payment of redemptions - (207) (3,044,222) (99) - Distributions paid Net cash (outflow)/inflow from financing activities - (207) (3,044,222) 137,703 - Net increase/(decrease) in cash and cash equivalents 44,648 14,743 (61,047) 15,699 12,388 Cash and cash equivalents at the start of the financial period 42, ,869 98,376 31,944 25,563 Foreign Currency Translation Adjustment - Cash and cash equivalents at the end of the financial period 86, ,612 37,329 47,643 37,951 Cashflows from operating activities include: Taxation paid (5,538) (1,796) (305) (2,386) (2,368) Interest received - 27,289 1, Dividend received 31,534 20,707 1,546 16,259 16,189 Dividend paid *This Sub- was fully redeemed during the financial period ended 30 June 2017 The accompanying notes form an integral part of the condensed unaudited financial statements. 21

24 Condensed Statement of Cash Flow For the six months ended 30 June 2016 Total BMO Global Low Volatility Alpha Equity Asia Pacific ex- Japan Equity Global Total Return (Sterling) Global Equity (US$) International (EAFE) Equity USD USD USD GBP USD USD Cash flows (used in)/provided by operating activities Net (decrease)/increase in net assets attributable to holders of redeemable participating shares 178,476,692 94,768 46, ,452,049 96, ,409 Adjustments for: Movement in financial assets at fair value through profit or loss (86,451,733) (83,140) (42,345) (59,462,864) (115,313) (76,883) Unrealised movement on derivative assets and liabilities 2,379, ,670,337 - Operating cash flows before movements in working capital 94,404,780 11,628 4,388 66,659,522 (18,915) 251,526 Movement in receivables (3,915,290) 4,290 1,586 (2,736,094) 5,908 (41,740) Movement in payables (2,794,592) (8,270) 4,406 (1,964,200) 2,610 (16,198) Cash (outflow)/inflow from operations (6,709,882) (3,980) 5,992 (4,700,294) 8,518 (57,938) Net cash inflow/(outflow) from operating activities 87,694,898 7,648 10,380 61,959,228 (10,397) 193,588 Cash flows from financing activities Proceeds from subscriptions 376,975, ,651, Payment of redemptions (410,568,107) - - (288,248,186) - - Net cash outflow from financing activities (33,592,525) - - (23,596,994) - - Net increase/(decrease) in cash and cash equivalents 54,102,373 7,648 10,380 38,362,234 (10,397) 193,588 Cash and cash equivalents at the start of the period 66,667,272 26,711 28,891 43,518, , ,002 Foreign Currency Translation Adjustment (9,325,034) Cash and cash equivalents at the end of the period 111,444,611 34,359 39,271 81,880, , ,590 Cashflows from operating activities include: Taxation paid (846,321) (3,907) (697) (552,704) (5,666) (35,495) Interest received 42,664, ,734, Dividend received 24,856,019 23,243 18,067 16,854,842 41, ,228 Dividend paid (1,223,424) - - (858,931) - - The accompanying notes form an integral part of the condensed unaudited financial statements. 22

25 Condensed Statement of Cash Flow For the six months ended 30 June 2016 cont/d Shariah Global Equity Global Total Return (Euro) Global Total Return (US$) Monegy Global High Yield Bond * Global Equity (Sterling) Global Equity (Euro) USD EUR USD USD GBP EUR Cash flows provided by operating activities Net increase/(decrease) in net assets attributable to holders of redeemable participating shares 77,218 (19,862) 51, ,051 73,063 7,673 Adjustments for: Movement in financial assets at fair value through profit or loss (91,748) 40,839 (76,373) (1,155,360) (107,064) (6,359) Unrealised movement on derivative assets and liabilities - (768) - - 2,662 (2,051) Operating cash flows before movements in working capital (14,530) 20,209 (24,861) (728,309) (31,339) (737) Movement in receivables 1,900 (654) 5,489 (6,517) 3,288 6,321 Movement in payables 3, ,550 (2,737) 4,280 5,922 Cash inflow/(outflow) from operations 5,478 (178) 12,039 (9,254) 7,568 12,243 Net cash (outflow)/inflow from operating activities (9,052) 20,031 (12,822) (737,563) (23,771) 11,506 Cash flows from financing activities Proceeds from subscriptions ,647 - Payment of redemptions (10) - Net cash inflow from financing activities ,637 - Net increase/(decrease) in cash and cash equivalents (9,052) 20,031 (12,822) (737,563) (11,134) 11,506 Cash and cash equivalents at the start of the period 57,798 95, ,974 1,551,234 27,428 20,591 Foreign Currency Translation Adjustment Cash and cash equivalents at the end of the period 48, , , ,671 16,294 32,097 Cashflows from operating activities include: Taxation paid (4,647) (1,235) (1,693) (73) (1,738) (2,106) Interest received , , Dividend received 29,336 11,186 13,028-11,186 13,787 Dividend paid *The Sub- was fully redeemed during the financial year ended 31 December The accompanying notes form an integral part of the condensed unaudited financial statements. 23

26 Notes to the Condensed Unaudited Financial Statements for the six months ended 30 June Significant Accounting Policies The significant accounting policies adopted by the Company for the six months ended 30 June 2017 are set out below. Basis of Preparation These Condensed Unaudited Financial Statements for the financial period ended 30 June 2017 have been prepared in accordance with IAS 34, Interim Financial Reporting ( IAS 34 ) issued by the Financial Reporting Council and in accordance with the UCITS Regulations. These Condensed Unaudited Financial Statements should be read in conjunction with the annual audited financial statements for the financial year ended 31 December 2016, which have been prepared under International Financial Reporting Standards ( IFRS ) as adopted by the European Union ( EU ). The auditor`s report in the audited year end financial statements as at 31 December 2016 was unqualified. The accounting policies, presentation and methods of calculation applied are consistent with those of the previous financial year. The Condensed Unaudited Financial Statements have been prepared on a going concern basis except for Global Total Return (US$) which terminated during the financial period ended 30 June Functional and Presentation Currency The Condensed Unaudited Financial Statements for the BMO Global Low Volatility Alpha Equity, Pyrfrord Asia Pacific ex-japan Equity, Global Equity (US$), International (EAFE) Equity, Shariah Global Equity and Global Total Return (US$) are presented in United States Dollars ( US$ ) and rounded to the nearest US$. The Condensed Unaudited Financial Statements for the Global Total Return (Sterling) and the Global Equity (Sterling) are presented in GBP ( ) and rounded to the nearest. The Condensed Unaudited Financial Statements for the Global Total Return (Euro) and the Global Equity (Euro) are presented in EUR ( ) and rounded to the nearest. The combined Company total amounts are presented in US$. Basis of accounting The Condensed Unaudited Financial Statements have been prepared on a historical cost basis except for those financial assets and financial liabilities that have been measured at fair value. In preparing these Condensed Unaudited Financial Statements, the significant judgements made by management in applying the Company s accounting policies and the key sources of estimation uncertainty were the same as those applied to the audited financial statements for the financial year ended 31 December New standards, amendments and interpretations issued but not effective for the financial year beginning 1 January 2017 and not early adopted IFRS 9 Financial Instruments was issued in July 2014 and will become effective for the periods beginning on or after 1 January The new standard is not expected to have a significant impact on the Company s financial position, performance or disclosures in its financial statements. IFRS 15 Revenue from Contracts with Customers was issued in May 2014 and will become effective for periods beginning on or after 1 January The new standard is not expected to have a significant impact on the Company s financial position, performance or disclosures in its financial statements. There are no other standards, interpretations or amendments to existing standards that are not yet effective that would be expected to have a significant impact on the Company. 24

27 Notes to the Condensed Unaudited Financial Statements for the six months ended 30 June 2017 cont/d 2. Taxation The Company is an investment undertaking as defined in Section 739B of the Taxes Consolidation Act, The Company will not generally be liable to Irish tax in respect of its income and gains, other than on the occurrence of a chargeable event. Generally a chargeable event arises on any distribution, redemption, repurchase, cancellation, transfer of shares or on the ending of a Relevant Period. A Relevant Period being an eight year period beginning with the acquisition of the shares by the Shareholder and each subsequent period of eight years beginning immediately after the preceding relevant period. A gain on a chargeable event does not arise in respect of: i) a shareholder who is not Irish resident and not ordinarily resident in Ireland at the time of the chargeable event provided the necessary signed statutory declarations are held by the Company; or ii) iii) certain exempted Irish resident investors who have provided the Company with the necessary signed statutory declaration; or any transactions in relation to shares held in a recognised clearing system as designated by order of the Revenue Commissioners of Ireland; or iv) an exchange of shares representing one Sub- for another Sub- of the Company; or v) an exchange of shares arising on a qualifying amalgamation or reconstruction of the Company with another company; or vi) certain exchanges of shares between spouses and former spouses. In the absence of an appropriate declaration, the Company will be liable to Irish tax on the occurrence of a chargeable event. There were no chargeable events during the period under review. Capital gains, dividends and interest received may be subject to withholding taxes imposed by the country of origin and such taxes may not be recoverable by the Company or its shareholders. 25