Fidelity True North Fund

Transcription

1 Fidelity True North Fund Annual Management Report of Fund Performance June 3, 217

2 Caution Regarding Forward-looking Statements Certain portions of this report, including, but not limited to, Results of Operations and Recent Developments, may contain forward-looking statements about the Fund, including its strategy, risks, expected performance and condition. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as expects, anticipates, intends, plans, believes, estimates and similar forward-looking expressions or negative versions thereof. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future Fund action, is also a forward-looking statement. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Fund and economic factors. Accordingly, assumptions concerning future economic and other factors may prove to be incorrect at a future date. Forward-looking statements are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied in any forward-looking statements made by the Fund. Any number of important factors could contribute to these digressions, including, but not limited to, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, and catastrophic events. It should be stressed that the above-mentioned list of important factors is not exhaustive. You are encouraged to consider these and other factors carefully before making any investment decisions and you are urged to avoid placing undue reliance on forward-looking statements. Further, you should be aware of the fact that the Fund has no specific intention of updating any forward-looking statements whether as a result of new information, future events or otherwise, prior to the release of the next Management Report of Fund Performance.

3 Annual Management Report of Fund Performance as at June 3, 217 Fidelity True North Fund This annual management report of fund performance contains financial highlights but does not contain the complete annual financial statements for the investment fund. You can get a copy of the annual financial statements at your request, and at no cost, by calling , by writing to us at Fidelity Investments, 483 Bay St. Suite 3, Toronto ON M5G 2N7 or by visiting our website at or SEDAR at Securityholders may also contact us using one of these methods to request a copy of the investment fund s proxy voting policies and procedures, proxy voting disclosure record or quarterly portfolio disclosure relating to the investment fund. Management Discussion of Fund Performance Investment Objective and Strategies Investment Objective: Fidelity True North Fund (Fund) aims to achieve long-term capital growth by investing primarily in equity securities of Canadian companies. Strategies: When buying and selling securities for the Fund, the portfolio manager examines each company s potential for success in light of its current financial condition, its industry position and economic and market conditions. The portfolio manager considers factors like growth potential, earnings estimates and quality of management. The Fund may invest in small, medium and large companies. The Fund may also invest up to approximately 3% of its net assets in foreign securities and may hold cash and invest in fixed-income securities. Risk The risks associated with investing in this Fund remain as discussed in the prospectus. Any changes to the Fund over the period have not affected the overall level of risk of the Fund. The Fund is suitable for long-term investors wanting to gain Canadian equity exposure and who can handle the volatility of returns generally associated with equity investments. Investors should be able to accept a medium level of risk. The suitability of the investment has not changed from what has been disclosed in the prospectus. Results of Operations Fidelity True North Fund, Series B, returned 6.5%, after fees and expenses, for the one-year period ended June 3, 217. The net returns of the other series of this Fund are similar to those of Series B, except for differences attributable to expense structures. The S&P/TSX Composite Index, broadly representative of the Canadian equity market, returned 11.% for the same period. The benchmark, the S&P/TSX Capped Composite Index, is the same as the S&P/TSX Composite Index, except that it is adjusted quarterly so that no single security has a relative weight in the Index greater than 1.%. Market overview: During the first half of the review period, Canadian equities rose on the strength of banking and oil and gas stocks. Share prices of Canadian banks rose, largely on the basis of continued positive investor sentiment, including a spillover effect from strength in U.S. financial stocks that rallied after the recent U.S. presidential election. Oil prices also rose during the first half of the period, following the agreement of the Organization of the Petroleum Exporting Countries (OPEC) to reduce crude output. During the second half of the review period, however, investors concerns about depressed oil prices, rising household debt and risks of a correction in the housing market weighed on Canadian equities. Factors affecting performance: The Fund s underperformance of its benchmark was primarily attributable to its positioning in the financials sector. The Fund s lower-thanbenchmark exposure to the sector detracted from relative returns after stock prices of financial services firms, especially banks, rose toward the end of the review period. A lower-than-benchmark allocation to Royal Bank of Canada, and lack of exposure to Bank of Nova Scotia and Bank of Montreal, made the primary detractions from relative performance in this sector. The Fund s exposure to certain holdings in the materials sector also detracted from relative performance. In this sector, gold producers such as Tahoe Resources and Eldorado Gold made top detractions from relative performance. Other detractions during the review period came from exposures to Canadian oil and gas company, Peyto Exploration & Development, and Canada-based drilling rig contractor, Precision Drilling. In contrast, the Fund s investments in select stocks in the information technology sector, such as Canadian software firm, Constellation Software, contributed to relative returns. Exposure to the telecommunications services sector also added value. In particular, lack of exposure to telecommunication company, BCE, as well as an investment in Rogers Communication, contributed to relative performance. In other sectors, lack of exposure to gold mining company, Barrick Gold, and integrated oil & gas firm, Cenovus Energy, contributed to relative performance. Portfolio changes: During the review period, the Fund s exposure to the information technology sector was increased when the portfolio manager added to positions in software and services firms, CGI Groupe and Constellation Software, preferred for their stable, recurring earnings and improving 1

4 Fidelity True North Fund Management Discussion of Fund Performance continued balance sheets. Exposure was also increased to the industrials sector by increasing a position in engineering and construction company, SNC- Lavalin Group, owing to its attractive valuation and improving fundamentals. In contrast, exposure to the energy and consumer discretionary sectors was reduced in the review period. In the energy sector, exposure was reduced to Canadian oil and gas companies, Peyto Exploration & Development and Tourmaline Oil; a decline in oil prices and a more cautious outlook on the commodity was expected to weigh on these companies. In the consumer discretionary sector, exposure to clothing manufacturer, Gildan Activewear, was closed due to a less favourable fundamental outlook. Exposure to the consumer staples sector was also decreased by reducing the Fund s holding in Canadian food retailer, Loblaw. Increasing competition in the grocery industry was expected to weigh on the company s performance. Recent Developments Portfolio manager, Maxime Lemieux, remains positive on U.S. and Canadian equity markets, given the resiliency of the U.S. economy, although he believes that market valuations appear elevated, and the rest of the world remains in a relatively slower growth environment. He notes, however, that in the near term, earnings growth appears to support equity prices. He continues to be cautious on China, where he believes there is growing complacency. He believes a macroeconomic shock could put the Chinese economy at risk, especially given its high levels of debt. Overall, he remains selective when considering any changes to the Fund s holdings, and continues to target companies with strong fundamentals, along with fair to attractive valuations. As at June 3, 217, the Fund s largest absolute exposure was to the financials sector, followed by the energy sector. The Fund varied the most from the benchmark sector weightings by allocating less to the financials and energy sectors and more to the information technology and consumer staples sectors. Independent Review Committee Effective February 28, 217, Helen M. Meyer retired from the Independent Review Committee and was replaced by James E. Cook as Chair. Also effective on that date, Frances Horodelski of Toronto, Ontario, became a member of the Independent Review Committee. 2

5 Related Party Transactions Manager and Portfolio Adviser The Fund is managed by Fidelity Investments Canada ULC (Fidelity). Fidelity is part of a broader group of companies collectively known as Fidelity Investments. Fidelity provides or arranges for the provision of all general management and administrative services required by the Fund in its day to day operations, bookkeeping, record keeping and other administrative services for the Fund. Fidelity is the portfolio adviser to the Fund and it provides investment advisory services to the Fund. Fidelity has entered into sub-advisory agreements with a number of entities including Fidelity (Canada) Asset Management ULC, to provide investment advice with respect to all or a portion of the investments of the Fund. The sub-advisors arrange for acquisition and disposition of portfolio investments, including all necessary brokerage arrangements. The Fund pays Fidelity a monthly management and advisory fee for their services, based on the net asset value of each Series, calculated daily and payable monthly. The Fund paid Fidelity management and advisory fees of $32,579, for the period ended June 3, 217. Administration Fee Fidelity charges the Fund a fixed administration fee in place of certain variable expenses. Fidelity, in turn, pays all of the operating expenses of the Fund, other than certain specified fund costs (e.g. the fees and expenses of the Independent Review Committee, taxes, brokerage commissions and interest charges). The Fund pays an annual rate, which is calculated on a tiered basis, based on the net asset value of each Series, calculated daily and payable monthly. The Fund paid Fidelity administration fees of $3,329, for the period ended June 3, 217. Brokerage Commissions The Fund may place a portion of its portfolio transactions with brokerage firms which are affiliates of Fidelity Investments, including National Financial Services LLC, provided it determines that these affiliates trade execution abilities and costs are comparable to those of non affiliated, qualified brokerage firms, on an execution only basis. Commissions paid to brokerage firms that are affiliates of Fidelity Investments were $7, for the period ended June 3, 217. Fidelity receives standing instructions from the IRC in respect of policies and procedures governing best execution of transactions with affiliates, which includes brokers affiliated to Fidelity Investments, at least once per year. 3

6 Financial Highlights The following tables show selected key financial information about the Fund and are intended to help you understand the Fund s financial performance for the period end of the years shown. This information is derived from the Fund s audited annual and/or unaudited semi-annual financial statements. Please see the front page for information about how you can obtain the Fund s annual or semi-annual financial statements. Fidelity True North Fund Series A Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ 27.6 Total revenue Total expenses (excluding distributions) (1.3) (.97) (1.1) (.88) (.73) Realized gains (losses) Unrealized gains (losses) 1.34 (2.22) (.36) Total increase (decrease) from operations B 2.66 (.29) From net investment income (excluding dividends) From dividends (.23) (.25) (.5) From capital gains (.95) (.35) (.5) Return of capital Total distributions B,C (1.17) (.6) (.1) Net assets, end of period B $ $ $ $ $ Net asset value (s) D $ 136,974 $ 177,9 $ 233,764 $ 291,139 $ 289,419 Securities outstanding D 3,326,235 4,567,281 5,853,282 7,625,434 9,213,145 Management expense ratio E,F 2.47% 2.47% 2.5% 2.52% 2.51% Management expense ratio before waivers or absorptions E,F 2.52% 2.53% 2.53% 2.52% 2.51% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $ Fidelity True North Fund Series B Periods ended June 3, Net assets, beginning of period B $ $ 4.44 $ $ $ Total revenue Total expenses (excluding distributions) (.96) (.9) (.94) (.81) (.67) Realized gains (losses) Unrealized gains (losses) 1.21 (2.1) (.55) Total increase (decrease) from operations B 2.65 (.5) From net investment income (excluding dividends) From dividends (.25) (.28) (.9) From capital gains (1.3) (.4) (.9) Return of capital Total distributions B,C (1.27) (.69) (.18) Net assets, end of period B $ $ $ 4.44 $ $ Net asset value (s) D $ 1,317,484 $ 1,413,61 $ 1,57,493 $ 1,591,553 $ 1,417,95 Securities outstanding D 31,56,168 36,12,657 38,822,51 41,167,17 44,573,48 Management expense ratio E,I 2.26% 2.26% 2.29% 2.29% 2.29% Management expense ratio before waivers or absorptions E,I 2.29% 2.29% 2.29% 2.29% 2.29% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $

7 Fidelity True North Fund Series F Periods ended June 3, Net assets, beginning of period B $ 42.4 $ $ $ $ Total revenue Total expenses (excluding distributions) (.52) (.49) (.51) (.44) (.37) Realized gains (losses) Unrealized gains (losses).92 (1.2) (.92) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.25) (.36) (.51) (.3) (.21) From capital gains (1.51) (.72) (.32) Return of capital Total distributions B,C (.25) (1.87) (1.24) (.63) (.21) Net assets, end of period B $ $ 42.4 $ $ $ Net asset value (s) D $ 162,974 $ 114,195 $ 64,151 $ 43,33 $ 26,529 Securities outstanding D 3,593,851 2,692,832 1,47,157 1,36, ,383 Management expense ratio E,F 1.11% 1.12% 1.13% 1.16% 1.16% Management expense ratio before waivers or absorptions E,F 1.14% 1.14% 1.16% 1.16% 1.16% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $ Fidelity True North Fund Series F5 Periods ended June 3, Net assets, beginning of period B $ $ $ $ 21.2 $ 2. Total revenue Total expenses (excluding distributions) (.27) (.26) (.29) (.28) (.4) Realized gains (losses) Unrealized gains (losses).59 (.69) (.7) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.13) (.2) (.29) (.17) From capital gains (.83) (.41) (.19) Return of capital (1.17) (1.19) (1.1) (.99) (.17) Total distributions B,C (1.3) (2.23) (1.81) (1.35) (.17) Net assets, end of period B $ $ $ $ $ 2.98 Net asset value (s) D $ 1,21 $ 993 $ 54 $ 3 $ 1 Securities outstanding D 52,48 44,86 22,92 12,278 5 Management expense ratio E,F 1.13% 1.12% 1.13% 1.18% 1.19% Management expense ratio before waivers or absorptions E,F 1.16% 1.14% 1.15% 1.18% 1.19% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $

8 Financial Highlights continued Fidelity True North Fund Series F8 Periods ended June 3, Net assets, beginning of period B $ 21.3 $ $ 23.7 $ 2.92 $ 2. Total revenue Total expenses (excluding distributions) (.26) (.26) (.29) (.27) (.5) Realized gains (losses) Unrealized gains (losses).41 (1.) (1.15) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.12) (.19) (.28) (.17) From capital gains (.78) (.4) (.19) Return of capital (1.46) (1.49) (1.55) (1.58) (.27) Total distributions B,C (1.58) (2.45) (2.22) (1.95) (.27) Net assets, end of period B $ 21.5 $ 21.3 $ $ 23.7 $ 2.88 Net asset value (s) D $ 849 $ 613 $ 57 $ 192 $ 3 Securities outstanding D 4,31 29,178 21,842 8,12 1,455 Management expense ratio E,F 1.13% 1.14% 1.16% 1.19% 1.18% Management expense ratio before waivers or absorptions E,F 1.15% 1.17% 1.19% 1.19% 1.18% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $ Fidelity True North Fund Series O Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.3) (.3) (.3) Realized gains (losses) Unrealized gains (losses) 1.31 (2.6) (.66) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.81) (.49) (.75) (.55) (.61) From capital gains (2.4) (1.7) (.59) Return of capital Total distributions B,C (.81) (2.52) (1.82) (1.14) (.61) Net assets, end of period B $ 48.6 $ $ $ $ Net asset value (s) D $ 3,214,465 $ 3,173,523 $ 3,15,77 $ 3,12,858 $ 2,469,24 Securities outstanding D 66,91,617 69,797,489 67,282,86 69,716,392 67,21,271 Management expense ratio % % % % % Management expense ratio before waivers or absorptions % % % % % Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $

9 Fidelity True North Fund Series T5 Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ 14.3 Total revenue Total expenses (excluding distributions) (.44) (.44) (.47) (.43) (.38) Realized gains (losses) Unrealized gains (losses).6 (1.32) (.26) Total increase (decrease) from operations B 1.14 (.35) From net investment income (excluding dividends) From dividends (.1) (.11) (.2) From capital gains (.42) (.16) (.2) Return of capital (.89) (.9) (.88) (.84) (.84) Total distributions B,C (.89) (1.42) (1.15) (.88) (.84) Net assets, end of period B $ $ $ $ $ Net asset value (s) D $ 914 $ 1,89 $ 2,271 $ 2,434 $ 1,498 Securities outstanding D 54,383 65,45 125, ,233 95,368 Management expense ratio E,F 2.5% 2.51% 2.54% 2.56% 2.52% Management expense ratio before waivers or absorptions E,F 2.56% 2.57% 2.56% 2.56% 2.52% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $ Fidelity True North Fund Series T8 Periods ended June 3, Net assets, beginning of period B $ $ 2.62 $ $ $ Total revenue Total expenses (excluding distributions) (.47) (.49) (.54) (.51) (.47) Realized gains (losses) Unrealized gains (losses).67 (1.32) (.11) Total increase (decrease) from operations B 1.27 (.27) From net investment income (excluding dividends) From dividends (.11) (.14) (.3) From capital gains (.47) (.19) (.3) Return of capital (1.56) (1.59) (1.62) (1.64) (1.64) Total distributions B,C (1.56) (2.17) (1.95) (1.7) (1.64) Net assets, end of period B $ $ $ 2.62 $ $ Net asset value (s) D $ 1,926 $ 2,579 $ 3,969 $ 5,815 $ 6,513 Securities outstanding D 17,872 14, , , ,269 Management expense ratio E,F 2.45% 2.47% 2.49% 2.51% 2.52% Management expense ratio before waivers or absorptions E,F 2.51% 2.53% 2.52% 2.51% 2.52% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $

10 Financial Highlights continued Fidelity True North Fund Series S5 Periods ended June 3, Net assets, beginning of period B $ $ $ $ $ Total revenue Total expenses (excluding distributions) (.4) (.4) (.44) (.4) (.35) Realized gains (losses) Unrealized gains (losses).45 (.86) (.34) Total increase (decrease) from operations B 1.7 (.1) From net investment income (excluding dividends) From dividends (.11) (.13) (.4) From capital gains (.45) (.19) (.4) Return of capital (.89) (.91) (.88) (.84) (.84) Total distributions B,C (.89) (1.47) (1.19) (.92) (.84) Net assets, end of period B $ 17.7 $ $ $ $ Net asset value (s) D $ 3,53 $ 3,149 $ 3,122 $ 2,367 $ 1,921 Securities outstanding D 179, ,96 17,69 129, ,47 Management expense ratio E,I 2.26% 2.28% 2.31% 2.33% 2.32% Management expense ratio before waivers or absorptions E,I 2.29% 2.31% 2.32% 2.33% 2.32% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $ Fidelity True North Fund Series S8 Periods ended June 3, Net assets, beginning of period B $ $ 2.97 $ $ $ 18.7 Total revenue Total expenses (excluding distributions) (.44) (.45) (.51) (.48) (.43) Realized gains (losses) Unrealized gains (losses).52 (.88) (.34) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.12) (.15) (.5) From capital gains (.51) (.22) (.5) Return of capital (1.57) (1.59) (1.63) (1.65) (1.66) Total distributions B,C (1.57) (2.23) (2.) (1.76) (1.66) Net assets, end of period B $ $ $ 2.97 $ $ Net asset value (s) D $ 1,359 $ 1,383 $ 9,993 $ 9,41 $ 8,34 Securities outstanding D 565, , , , ,255 Management expense ratio E,I 2.26% 2.26% 2.29% 2.3% 2.3% Management expense ratio before waivers or absorptions E,I 2.29% 2.29% 2.3% 2.3% 2.3% Trading expense ratio G.4%.4%.4%.5%.6% Portfolio turnover rate H 26.63% 31.86% 28.8% 27.31% 23.99% Net asset value per security, end of period $ $ $ $ $

11 Fidelity True North Fund Series E1 Periods ended June 3, J Net assets, beginning of period B $ 1.76 $ 1. Total revenue.24.1 Total expenses (excluding distributions) (.26) (.9) Realized gains (losses).44 (.1) Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ 1.76 Net asset value (s) D $ 111,16 $ 57,57 Securities outstanding D 9,683,99 5,333,198 Management expense ratio E,K 2.21% 2.21% Management expense ratio before waivers or absorptions E,K 2.23% 2.24% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $ Fidelity True North Fund Series E1T5 Periods ended June 3, J Net assets, beginning of period B $ 21.5 $ 2. Total revenue Total expenses (excluding distributions) (.49) (.17) Realized gains (losses).87 Unrealized gains (losses) (.4).71 Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends From capital gains Return of capital (1.11) (.46) Total distributions B,C (1.11) (.46) Net assets, end of period B $ $ 21.5 Net asset value (s) D $ 23 $ 58 Securities outstanding D 1,826 2,768 Management expense ratio E,K 2.2% 2.12% Management expense ratio before waivers or absorptions E,K 2.23% 2.15% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $

12 Financial Highlights continued Fidelity True North Fund Series E2 Periods ended June 3, J Net assets, beginning of period B $ 1.76 $ 1. Total revenue.24.1 Total expenses (excluding distributions) (.25) (.9) Realized gains (losses).44 (.1) Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ 1.76 Net asset value (s) D $ 11,88 $ 4,81 Securities outstanding D 966, ,444 Management expense ratio E,K 2.14% 2.14% Management expense ratio before waivers or absorptions E,K 2.17% 2.17% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $ Fidelity True North Fund Series E2T5 Periods ended June 3, J Net assets, beginning of period B $ 21.6 $ 2. Total revenue Total expenses (excluding distributions) (.46) (.18) Realized gains (losses).98 (.12) Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends From capital gains Return of capital (1.11) (.46) Total distributions B,C (1.11) (.46) Net assets, end of period B $ $ 21.6 Net asset value (s) D $ 1 $ 1 Securities outstanding D Management expense ratio E,K 2.11% 2.8% Management expense ratio before waivers or absorptions E,K 2.37% 2.11% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $

13 Fidelity True North Fund Series E3 Periods ended June 3, J Net assets, beginning of period B $ 1.76 $ 1. Total revenue.23.1 Total expenses (excluding distributions) (.24) (.9) Realized gains (losses).44 (.1) Unrealized gains (losses).3.9 Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ 1.76 Net asset value (s) D $ 62 $ 445 Securities outstanding D 52,4 41,349 Management expense ratio E,K 2.8% 2.2% Management expense ratio before waivers or absorptions E,K 2.11% 2.5% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $ Fidelity True North Fund Series E4 Periods ended June 3, J Net assets, beginning of period B $ 1.76 $ 1. Total revenue.24.1 Total expenses (excluding distributions) (.25) (.8) Realized gains (losses).44.4 Unrealized gains (losses) (.35).7 Total increase (decrease) from operations B.8.76 From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ 1.76 Net asset value (s) D $ 285 $ 1 Securities outstanding D 24,795 1 Management expense ratio E,K 2.7% 1.98% Management expense ratio before waivers or absorptions E,K 2.1% 1.98% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $

14 Financial Highlights continued Fidelity True North Fund Series E5 Periods ended June 3, J Net assets, beginning of period B $ 1.77 $ 1. Total revenue.23.1 Total expenses (excluding distributions) (.2) (.8) Realized gains (losses).44.4 Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributions B,C Net assets, end of period B $ $ 1.77 Net asset value (s) D $ 1 $ 1 Securities outstanding D 1 1 Management expense ratio E,K 1.82% 1.96% Management expense ratio before waivers or absorptions E,K 1.82% 1.96% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $ Fidelity True North Fund Series P1 Periods ended June 3, L Net assets, beginning of period B $ 9.9 $ 1. Total revenue Total expenses (excluding distributions) (.12) (.6) Realized gains (losses).4.9 Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.6) (.8) From capital gains (.35) Return of capital Total distributions B,C (.6) (.44) Net assets, end of period B $ 1.61 $ 9.9 Net asset value (s) D $ 23,52 $ 11,8 Securities outstanding D 2,178,263 1,118,856 Management expense ratio E,M 1.6% 1.8% Management expense ratio before waivers or absorptions E,M 1.9% 1.1% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ 1.66 $

15 Fidelity True North Fund Series P1T5 Periods ended June 3, L Net assets, beginning of period B $ $ 2. Total revenue Total expenses (excluding distributions) (.23) (.12) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.12) (.17) From capital gains (.71) Return of capital (.99) (.58) Total distributions B,C (1.11) (1.46) Net assets, end of period B $ $ Net asset value (s) D $ 166 $ 7 Securities outstanding D 8,479 3,676 Management expense ratio E,M 1.7% 1.6% Management expense ratio before waivers or absorptions E,M 1.1% 1.7% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $ Fidelity True North Fund Series P2 Periods ended June 3, L Net assets, beginning of period B $ 9.91 $ 1. Total revenue Total expenses (excluding distributions) (.11) (.6) Realized gains (losses).4.11 Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.7) (.8) From capital gains (.35) Return of capital Total distributions B,C (.7) (.44) Net assets, end of period B $ 1.61 $ 9.91 Net asset value (s) D $ 5,374 $ 2,594 Securities outstanding D 56, ,916 Management expense ratio E,M 1.1% 1.3% Management expense ratio before waivers or absorptions E,M 1.4% 1.5% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $

16 Financial Highlights continued Fidelity True North Fund Series P2T5 Periods ended June 3, 217 N Net assets, beginning of period B $ 2. Total revenue.8 Total expenses (excluding distributions) (.4) Realized gains (losses).6 Unrealized gains (losses) (.18) Total increase (decrease) from operations B (.8) From net investment income (excluding dividends) From dividends From capital gains Return of capital (.25) Total distributions B,C (.25) Net assets, end of period B $ Net asset value (s) D $ 343 Securities outstanding D 17,427 Management expense ratio E,O 1.1% Management expense ratio before waivers or absorptions E,O 1.4% Trading expense ratio G.4% Portfolio turnover rate H 26.63% Net asset value per security, end of period $ Fidelity True North Fund Series P3 Periods ended June 3, L Net assets, beginning of period B $ 9.91 $ 1. Total revenue Total expenses (excluding distributions) (.11) (.5) Realized gains (losses).43.4 Unrealized gains (losses) Total increase (decrease) from operations B From net investment income (excluding dividends) From dividends (.7) (.8) From capital gains (.35) Return of capital Total distributions B,C (.7) (.44) Net assets, end of period B $ 1.62 $ 9.91 Net asset value (s) D $ 15 $ 13 Securities outstanding D 9,922 1,392 Management expense ratio E,M.96%.98% Management expense ratio before waivers or absorptions E,M.99%.99% Trading expense ratio G.4%.4% Portfolio turnover rate H 26.63% 31.86% Net asset value per security, end of period $ $

17 Fidelity True North Fund Series P4 Periods ended June 3, 217 P Net assets, beginning of period B $ 1. Total revenue.16 Total expenses (excluding distributions) (.8) Realized gains (losses).36 Unrealized gains (losses).18 Total increase (decrease) from operations B.62 From net investment income (excluding dividends) From dividends (.8) From capital gains Return of capital Total distributions B,C (.8) Net assets, end of period B $ 1.42 Net asset value (s) D $ 1 Securities outstanding D 3,562 Management expense ratio E,Q.92% Management expense ratio before waivers or absorptions E,Q.94% Trading expense ratio G.4% Portfolio turnover rate H 26.63% Net asset value per security, end of period $ Fidelity True North Fund Series P5 Periods ended June 3, 217 P Net assets, beginning of period B $ 1. Total revenue.17 Total expenses (excluding distributions) (.7) Realized gains (losses).24 Unrealized gains (losses) (.3) Total increase (decrease) from operations B.31 From net investment income (excluding dividends) From dividends (.8) From capital gains Return of capital Total distributions B,C (.8) Net assets, end of period B $ 1.41 Net asset value (s) D $ 37 Securities outstanding D 11 Management expense ratio E,Q.86% Management expense ratio before waivers or absorptions E,Q.88% Trading expense ratio G.4% Portfolio turnover rate H 26.63% Net asset value per security, end of period $

18 Financial Highlights continued Financial Highlights Footnotes A This information is derived from the Fund s audited annual and/or unaudited interim financial statements. Periods beginning on or after January 1, 213 follow International Financial Reporting Standards (IFRS) and periods prior to January 1, 213 follow Canadian Generally Accepted Accounting Principles (Canadian GAAP). The net assets attributable to securityholders per security presented in the financial statements may differ from the net asset value calculated for fund pricing purposes. An explanation of these differences can be found in the notes to financial statements. For reporting periods ending after January 1, 217 per security comparative figures (except for net asset value per security, end of period) have been conformed to the current rounding presentation of two decimal places. As a result, reporting periods ending prior to January 1, 217 may not foot due to this rounding change. B C D E F G H I Net assets and distributions are based on the actual number of securities outstanding at the relevant time. The increase (decrease) from operations is based on the weighted average number of securities outstanding over the financial period. This table is not intended to be a reconciliation of beginning to ending net assets per security. Distributions were paid in cash or reinvested in additional securities of the Fund, or both, and excludes any applicable distributions of management fee reduction to securityholders. Distributions are presented based on management s best estimate of the tax character. This information is provided as at period end of the year shown. Management expense ratio is based on total expenses (excluding distributions, commissions and other portfolio transaction costs) for the stated period and is expressed as an annualized percentage of daily average net asset values during the period, including the Fund s pro-rata share of estimated expenses incurred in any underlying investment fund, if applicable. Effective November 1, 214, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. The trading expense ratio represents total commissions and other portfolio transaction costs expressed as an annualized percentage of daily average net asset value during the period, including the Fund s pro-rata share of estimated trading costs incurred in any underlying investment fund, if applicable. The Fund s portfolio turnover rate indicates how actively the Fund s portfolio adviser manages its portfolio investments. A portfolio turnover rate of 1% is equivalent to the Fund buying and selling all of the securities in its portfolio once in the course of the year. The higher the Fund s portfolio turnover rate in a year, the greater the trading costs payable by the Fund in the year, and the greater chance of an investor receiving taxable capital gains in the year. There is not necessarily a relationship between a high portfolio turnover rate and the performance of the Fund. The portfolio turnover rate is calculated based on the lesser of purchases or sales of securities divided by the weighted average market value of the portfolio securities, excluding short-term securities. For periods greater than six months, but less than a full fiscal year, the portfolio turnover rate is annualized. Effective October 1, 215, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. J For the period February 5, 216 (commencement of sale of securities) to June 3, 216. K Effective February 9, 216, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. L For the period December 4, 215 (commencement of sale of securities) to June 3, 216. M Effective December 8, 215, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. N For the period April 21, 217 (commencement of sale of securities) to June 3, 217. O Effective April 25, 217, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. P For the period September 16, 216 (commencement of sale of securities) to June 3, 217. Q Effective September 2, 216, the manager of the Fund has waived a portion of its administration fee and as of the date of the MRFP has continued to provide the Fund with such waivers. The manager may terminate the waiver at any time, at its sole discretion. It is not known when such waivers will be terminated. 16

19 Management and Advisory Fees Fidelity serves as manager and investment advisor of the Fund. The Fund pays Fidelity a monthly management and advisory fee for their services, based on the net asset value of each Series, calculated daily and payable monthly. Fidelity uses these management fees to pay for sales and trailing commissions to registered dealers on the distribution of the Fund securities, as well as for the general investment management expenses. Dealer compensation represents cash commissions paid by Fidelity to registered dealers during the period and includes upfront deferred sales charge and trailing commissions. This amount may, in certain circumstances, exceed 1% of the fees earned by Fidelity during the period. For new Funds or Series the amounts presented may not be indicative of longer term operating periods. Management Fees Dealer Compensation Investment management, administration and other Series A 2.% 39.83% 6.17% Series B 1.85% 54.5% 45.95% Series F.85% 1.% Series F5.85% 1.% Series F8.85% 1.% Series T5 2.% 35.24% 64.76% Series T8 2.% 38.48% 61.52% Series S5 1.85% 54.5% 45.95% Series S8 1.85% 54.5% 45.95% Series E % 54.79% 45.21% Series E1T % 54.79% 45.21% Series E2 1.8% 55.56% 44.44% Series E2T5 1.8% 55.56% 44.44% Series E % 56.34% 43.66% Series E % 57.97% 42.3% Series E5 1.7% 58.82% 41.18% Series P1.825% 1.% Series P1T5.825% 1.% Series P2.8% 1.% Series P2T5.8% 1.% Series P3.775% 1.% Series P4.725% 1.% Series P5.7% 1.% 17

20 Fidelity True North Fund Past Performance The performance information shown assumes that all distributions made by the Fund in the periods shown were reinvested in additional securities of the Fund. The performance information does not take into account sales, redemption, distribution or other optional charges that would have reduced returns or performance. How the Fund has performed in the past does not necessarily indicate how it will perform in the future. Year-by-Year Returns The following bar chart shows the Fund s annual performance for each of the years shown, and illustrates how the Fund s performance was changed from year to year. In percentage terms, the bar chart shows how much an investment made on the first day of each financial year would have grown or decreased by the last day of each financial year. Series A Series F Series B Commencement of Operations is April 17, Series F Series F -1 Commencement of Operations is April 17, Series O

21 Series T5 Series E Series T8 Commencement of Operations is February 5, Series E1T Series S5-1 Commencement of Operations is February 5, Series E Series S Commencement of Operations is February 5, Series E2T Commencement of Operations is February 5,

22 Fidelity True North Fund Past Performance continued Series E3 Series P1T Commencement of Operations is February 5, 216 Commencement of Operations is December 4, 215 Series E4 Series P Commencement of Operations is February 5, 216 Commencement of Operations is December 4, 215 Series E5 Series P2T Commencement of Operations is February 5, 216 Commencement of Operations is April 21, 217 Series P1 Series P Commencement of Operations is December 4, 215 Commencement of Operations is December 4, 215 2

23 Series P4 Series P Commencement of Operations is September 16, 216 Commencement of Operations is September 16, 216 Annual Compound Returns This table shows the Fund s historical annual compound total returns for the periods indicated, compared with a broad-based index, the S&P/ TSX Composite Index, and the Fund s benchmark, the S&P/TSX Capped Composite Index, as described below. Past 1 year Past 3 years Past 5 years Past 1 years Since Inception Average Annual Total Returns Fidelity True North Fund - Series A 6.3% 4.2% 9.8% 3.8% n/a Fidelity True North Fund - Series B 6.5% 4.4% 1.% 4.% n/a Fidelity True North Fund - Series F 7.7% 5.6% 11.3% 5.2% n/a Fidelity True North Fund - Series F5 7.7% 5.6% n/a n/a 1.8% Fidelity True North Fund - Series F8 7.7% 5.6% n/a n/a 1.8% Fidelity True North Fund - Series O 8.9% 6.8% 12.6% 6.4% n/a Fidelity True North Fund - Series T5 6.2% 4.1% 9.8% 3.8% n/a Fidelity True North Fund - Series T8 6.3% 4.2% 9.8% 3.8% n/a Fidelity True North Fund - Series S5 6.5% 4.4% 1.% 4.% n/a Fidelity True North Fund - Series S8 6.5% 4.4% 1.% 4.% n/a Fidelity True North Fund - Series E1 6.5% n/a n/a n/a 1.2% Fidelity True North Fund - Series E1T5 6.6% n/a n/a n/a 1.3% Fidelity True North Fund - Series E2 6.6% n/a n/a n/a 1.3% Fidelity True North Fund - Series E2T5 6.6% n/a n/a n/a 1.3% Fidelity True North Fund - Series E3 6.7% n/a n/a n/a 1.4% Fidelity True North Fund - Series E4 6.8% n/a n/a n/a 1.5% Fidelity True North Fund - Series E5 6.9% n/a n/a n/a 1.6% Fidelity True North Fund - Series P1 7.8% n/a n/a n/a 7.3% Fidelity True North Fund - Series P1T5 7.7% n/a n/a n/a 7.3% Fidelity True North Fund - Series P2 7.8% n/a n/a n/a 7.3% Fidelity True North Fund - Series P3 7.9% n/a n/a n/a 7.4% S&P/TSX Capped Composite Index 11.% 3.1% 8.7% 3.9% 9.1% S&P/TSX Composite Index 11.% 3.1% 8.7% 3.9% 9.1% The period used for the since inception S&P/TSX Capped Composite Index and S&P/TSX Composite Index returns are based on Series F5 which has been in existence the longest compared to all Series with less than 1 years of operations. A discussion of the performance of the Fund can be found in the Results of Operation section of this report. The S&P/TSX Composite Index is an index of stocks that are generally considered to represent the Canadian equity market. The S&P/TSX Capped Composite Index is the same as the S&P/TSX Composite Index except that it is adjusted quarterly so that no single stock has a relative weight in the Index greater than 1.%. Each Series will have different returns because of differences in management fees and expenses. 21

24 Fidelity True North Fund Summary of Investment Portfolio as at June 3, 217 Sector Mix % of Fund s Net Assets as at 6/3/17 % of Fund s Net Assets as at 6/3/16 Financials Energy Information Technology Industrials Consumer Staples Consumer Discretionary Materials Telecommunication Services Health Care Utilities Real Estate 1.2. Canadian Bonds.2.1 Cash and Cash Equivalents Net Other Assets (Liabilities) (.3) (.4) Prior period industry classifications reflect the categories in place as of the date indicated and have not been adjusted to reflect current industry classifications. Top 25 Issuers % of Fund s Net Assets 1. Cash and Cash Equivalents The Toronto-Dominion Bank Canadian National Railway Co Rogers Communications, Inc CGI Group, Inc Enbridge, Inc Suncor Energy, Inc Royal Bank of Canada Restaurant Brands International, Inc Alimentation Couche-Tard, Inc Loblaw Companies Ltd Metro, Inc Manulife Financial Corp Constellation Software, Inc Power Corp. of Canada SNC-Lavalin Group, Inc Franco-Nevada Corp Intact Financial Corp PrairieSky Royalty Ltd Canadian Natural Resources Ltd CAE, Inc Peyto Exploration & Development Corp Fairfax Financial Holdings Ltd TELUS Corp Quebecor, Inc Total Fund Net Assets $4,999,789, The summary of investment portfolio may change due to ongoing portfolio transactions of the investment fund. The most recent annual report, semi-annual report, quarterly report, fund facts document or simplified prospectus for the investment fund and/or underlying fund is available at no cost, by calling , by writing to us at Fidelity Investments Canada ULC, 483 Bay St. Suite 3, Toronto ON M5G 2N7 or by visiting our web site at or SEDAR at 22

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28 Fidelity Investments Canada ULC 483 Bay Street, Suite 3 Toronto, Ontario M5G 2N7 Manager, Transfer Agent and Registrar Fidelity Investments Canada ULC 483 Bay Street, Suite 3 Toronto, Ontario M5G 2N7 Custodian State Street Trust Company of Canada Toronto, Ontario Portfolio Adviser Fidelity Investments Canada ULC Toronto, Ontario Visit us online at or call Fidelity Client Services at Fidelity s mutual funds are sold by registered Investment Professionals. Each Fund has a simplified prospectus, which contains important information on the Fund, including its investment objective, purchase options, and applicable charges. Please obtain a copy of the prospectus, read it carefully, and consult your Investment Professional before investing. As with any investment, there are risks to investing in mutual funds. There is no assurance that any Fund will achieve its investment objective, and its net asset value, yield, and investment return will fluctuate from time to time with market conditions. Investors may experience a gain or loss when they sell their securities in any Fidelity Fund. Fidelity Global Funds may be more volatile than other Fidelity Funds as they concentrate investments in one sector and in fewer issuers; no single Fund is intended to be a complete diversified investment program. Past performance is no assurance or indicator of future returns. There is no assurance that either Fidelity Canadian Money Market Fund or Fidelity U.S. Money Market Fund will be able to maintain its net asset value at a constant amount. The breakdown of Fund investments is presented to illustrate the way in which a Fund may invest, and may not be representative of a Fund s current or future investments. A Fund s investments may change at any time. Fidelity Investments is a registered trademark of Fidelity Investments Canada ULC E FICL-TN-MRFPA-917