New Capital Alternative Strategies plc

Transcription

1 New Capital Alternative Strategies plc Unaudited, Condensed Semi-Annual Report for the period ended 31 December 2017 New Capital Alternative Strategies plc is a company incorporated with limited liability as an investment company with variable capital under the laws of Ireland. It is an umbrella fund with segregated liability between sub-funds. Alternative Investment Fund Manager EFG Asset Management (UK) Limited, London

2 Table of Contents Directory 2 General Information 3 Investment Objectives 4 New Capital Multi-Hedge Focus Fund - Portfolio Statement and Analysis 5 New Capital Tactical Opportunities Fund - Portfolio Statement and Analysis 7 Statement of Net Assets 9 Statement of Operations 11 Statement of Changes in Net Assets Attributable to Redeemable Participating Shareholders 12 Notes to the Semi-Annual Report 13 Additional Notes 21 Appendix 24 1

3 Directory Board of Directors Mozamil Afzal Executive Director and Chief Executive Officer EFG Asset Management (UK) Limited London, United Kingdom Steven Johnson Director and Chief Operations Officer EFG Asset Management (UK) Limited London, United Kingdom Nicholas Carpenter Assistant Director of Operations, EFG Asset Management (UK) Limited London, United Kingdom John Hamrock Independent non-executive Director Dublin, Ireland Karl McEneff Independent non-executive Director Dublin, Ireland Frank Connolly Non-executive Director Principal and Senior Consultant KB Associates Dublin, Ireland Registered Address of the Company 5 George s Dock IFSC Dublin 1, Ireland Administrator and Registrar HSBC Securities Services (Ireland) DAC 1 Grand Canal Square Grand Canal Harbour Dublin 2, Ireland Company Secretary KB Associates Ground Floor 5 George s Dock IFSC Dublin 1, Ireland Depositary HSBC Institutional Trust Services (Ireland) DAC 1 Grand Canal Square Grand Canal Harbour Dublin 2, Ireland Independent Auditors PricewaterhouseCoopers Chartered Accountants & Registered Auditors One Spencer Dock North Wall Quay Dublin 1, Ireland Irish Legal Advisers Dillon Eustace 33 Sir John Rogerson s Quay Dublin 2, Ireland Alternative Investment Fund Manager ( AIFM ) EFG Asset Management (UK) Limited Leconfield House Curzon Street London W1J 5JB, United Kingdom Investment Manager New Capital Multi-Hedge Focus Fund EFG Asset Management (Switzerland) SA 24 Quai du Seujet P.O. Box 2391, 1211 Geneva 2, Switzerland 2

4 General Information Principal Activities New Capital Alternative Strategies plc (the Company ) was incorporated and registered in Ireland as an umbrella type investment company with variable capital on 24 July It is an open-ended umbrella type investment company with variable capital authorised by the Central Bank of Ireland pursuant to the provisions of the Companies Act 2014, (as amended). As at 31 December 2017 the Company comprised two separate subfunds, New Capital Multi-Hedge Focus Fund and New Capital Tactical Opportunities Fund. Shares in each sub-fund may be classified into one or more classes. A separate portfolio of assets will be maintained for each sub-fund and will be invested in accordance with the investment objective and policies applicable to such a sub-fund as set out on page 4. Application for shares If applying to buy shares for the first time, the application should be made in writing to the Company by completing the application form prescribed (from time to time by the Board and delivering the original application form) to the Administrator (HSBC Securities Services (Ireland) DAC) as delegate of the Company as specified in the relevant supplement of the Prospectus or application form. Subsequent applications to buy shares can be submitted to the Company in writing by post, by facsimile, by or by telephone. Redemption of shares Shareholders may request a repurchase by facsimile or other written communication or such other means as may from time to time be specified by the Board or their delegate in accordance with the requirements of the Central Bank of Ireland (in each case specifying the shareholder s full name, address and account number). Publication of prices Prices are available from the Administrator and will be published when calculated in the Morningstar, Bloomberg and in such other newspapers or media as the Board may instruct the Administrator. Reports The annual report and audited financial statements of the Company will be sent to shareholders within six months from the end of the period to which they relate. Unaudited semi-annual reports will also be made available to shareholders within two months of the end of the period. 3

5 Investment Objectives The investment objectives of each sub-fund are set out below. New Capital Multi-Hedge Focus Fund The investment objective of the sub-fund is to seek to maximise capital returns, by employing a diversified multi-manager fund framework. The sub-fund focuses on collective investment schemes, which are either closed to new investors or hard to access for a traditional investor due to liquidity issues. New Capital Tactical Opportunities Fund The investment objective of the sub-fund is to achieve maximum capital appreciation through investment in global financial markets. 4

6 New Capital Multi-Hedge Focus Fund Portfolio Statement and Analysis as at 31 December 2017 Holdings Description Fair value % of sub-fund Collective Investment Scheme (31 December 2016: 95.57%) United States (31 December 2016: 35.27%) 5,796 Elliott International Limited 7,538, VR Global O/S Fund 6,302, ,840, Cayman Islands (31 December 2016: 39.42%) 3,807 Millennium International Limited 8,017, ,017, Ireland (31 December 2016: 20.88%) 8,029 New Capital All Weather UCITS Fund 984, Bennelong Asia Pacific Multi Strategy S** 39, ,023, ,372 Luxembourg (31 December 2016: Nil) 767, , Bermuda (31 December 2016: Nil) 4,826 Millennium Global Emerging Fund* Channel Islands (31 December 2016: Nil) 66 Absolute Return Europe Fund * Absolute Return Europe Fund EUR* Total Collective Investment Scheme 23,648, Structured Note (31 December 2016: 2.67%) *A Liquidating fund **Side-Pocket holding 5

7 New Capital Multi-Hedge Focus Fund Portfolio Statement and Analysis as at 31 December 2017 (continued) Forward Foreign Exchange Currency Contracts** Purchase Currency Contractual Amount Amounts receivable (31 December 2016: 0.61%)** Sale currency Contractual amount Maturity date Unrealised gain % of sub-fund EUR 1,935,140 2,279,082 01/12/ , GBP 33,909 45,721 01/12/ Unrealised gain on forward foreign exchange currency contracts 46, Purchase Currency Contractual Amount Sale currency Contractual amount Maturity date Unrealised gain % of sub-fund Amounts payable (31 December 2016: (0.24%))** 88 GBP 66 01/12/2018 (1) - 6,287 EUR 5,291 01/12/2018 (71) - 961,629 EUR 826,000 01/31/2018 (31,998) (0.10) Unrealised loss on forward foreign exchange currency contracts (32,070) (0.10) **The counterparties for the outstanding forward foreign exchange currency contracts are HSBC Bank PLC and Bank of America Total Investment at fair value - assets 23,695, Total Investment at fair value - liabilities (32,070) (0.10) Net investments at fair value 23,663, Net current assets 8,619, Net assets attributable to redeemable participating shareholders 32,282,

8 New Capital Tactical Opportunities Fund Portfolio Statement and Analysis as at 31 December 2017 Holdings Description Fair value % of sub-fund Equities (31 December 2016: %)* United States (31 December 2016: 92.35%) 40,187 Splunk 3,328, ,250 Ubiquiti Networks 3,213, ,900 Abercrombie & Fitch 3,065, ,566 Box 2,990, ,000 Skechers 2,989, ,362 Workday 2,885, ,103 Micron Technology 2,759, ,092,479 Other Investments 28,653, ,885, China (31 December 2016 : 10.43%) 7,875,000 China Hongxing Sports** - - 3,625,200 Other Investments 3,549, ,549, Canada (31 December 2016: Nil) 97,062 Canada Goose Holdings 3,063, ,063, ,380 Cayman Islands (31 December 2016: Nil) 1,507, ,507, ,166,000 Hong Kong (31 December 2016 : 3.50%) 1,220, ,220, Netherlands (31 December 2016 : 3.43%) Total Equities* 59,226, Futures*** 55 H-Shares Index Futures (HKG) January , Nikkei 225 Futures (OSE) March , Total Futures Assets*** 63, ***The Counterparty for the outstanding futures is Morgan Stanley & Co. International plc. * By country of quotation ** Dealing suspended 7

9 New Capital Tactical Opportunities Fund Portfolio Statement and Analysis as at 31 December 2017 (continued) Forward Foreign Exchange Currency Contracts**** Purchase Contractual Currency Amount Amounts receivable (31 December 2016: Nil)**** Sale currency Contractual amount Maturity date Unrealised gain % of sub-fund EUR 6,361,963 7,492,707 01/12/ , GBP 909,426 1,226,214 01/12/2018 4, EUR 107, ,287 01/12/2018 2,667 - GBP 15,466 20,632 01/12/ Unrealised gain on forward foreign exchange currency contracts 158, Purchase Currency Contractual Amount Amounts payable (31 December 2016: (0.39%))**** Sale currency Contractual amount Maturity date Unrealised gain % of sub-fund GBP 26,794 36,271 01/12/2018 (15) - 28,173 EUR 23,831 01/12/2018 (460) - 29,087 EUR 24,368 01/12/2018 (191) - 46,756 GBP 34,958 01/12/2018 (548) - EUR 195, ,560 01/12/2018 (69) - Unrealised loss on forward foreign exchange currency contracts (1,283) - ****The counterparties for the outstanding forward foreign exchange currency contracts is HSBC Bank PLC Total Investment at fair value - assets 59,448, Total Investment at fair value - liabilities (1,283) - Net investments at fair value 59,447, Net current liabilities (5,218,084) (9.62) Net assets attributable to redeemable participating shareholders 54,228,

10 Statement of Net Assets As at 31 December 2017 Current assets New New New New New New Capital Capital Capital Capital Capital Capital Multi-Hedge Multi-Hedge Tactical Tactical Alternative Alternative Focus Focus Opportunities Opportunities Strategies plc Strategies plc Fund Fund Fund Fund Notes 31 December 30 June 31 December 30 June 31 December 30 June Debtors 26,141 56,187 4,184-21,957 56,187 Cash at bank 10,286,961 7,535,436 10,286,961 7,535, Margin Cash 1,584,353 1,005,162-1,584,353 1,005,162 Financial assets at fair value through profit or loss 3 83,143,431 83,087,409 23,695,132 28,476,361 59,448,299 54,611,048 Total current assets 95,040,886 91,684,194 33,986,277 36,011,797 61,054,609 55,672,397 Current liabilities Financial liabilities at fair through profit or loss 3 (33,353) (275,692) (32,070) (252,963) (1,283) (22,729) Bank overdraft (4,333,368) (5,265,184) - - (4,333,368) (5,265,184) Margin Cash (1,156,925) (546,000) - - (1,156,925) (546,000) Creditors (3,005,529) (7,951,918) (1,671,428) (7,449,696) (1,334,101) (502,222) Total current liabilities (excluding net assets attributable to redeemable participating shareholders) (8,529,175) (14,038,794) (1,703,498) (7,702,659) (6,825,677) (6,336,135) Net assets attributable to redeemable participating shareholders 86,511,711 77,645,400 32,282,779 28,309,138 54,228,932 49,336,262 The accompanying notes form an integral part of these financial statements. 9

11 Statement of Net Assets (continued) As at 31 December 2017 New Capital Multi-Hedge Focus Fund 31 December 2017 New Capital Multi-Hedge Focus Fund 30 June 2017 New Capital Tactical Opportunities Fund 31 December 2017 New Capital Tactical Opportunities Fund 30 June 2017 Net asset value per share US dollar Class Sterling Class Euro Class Total net assets US dollar Class 30,470,609 26,116,203 45,104,933 40,820,912 Sterling Class 34,024 32, , ,464 Euro Class 1,470,807 1,885,150 6,571,879 6,532,732 Shares in issue US dollar Class 242, , , ,753 Sterling Class ,870 5,065 Euro Class 13,436 17,704 39,746 45,501 The accompanying notes form an integral part of these financial statements. 10

12 Statement of Operations For the six month period ended 31 December 2017 New New New New New New Capital Capital Capital Capital Capital Capital Multi-Hedge Multi-Hedge Tactical Tactical Alternative Alternative Focus Focus Opportunities Opportunities Strategies plc Strategies plc Fund Fund Fund Fund Notes 31 December 31 December 31 December 31 December 31 December 31 December Income Gross dividends 279, , , ,906 Other Income 11,278 5,193 7,216 3,429 4,062 1,764 Net gains on investments and foreign currency 4 11,338,534 12,027,953 1,536,059 2,547,492 9,802,475 9,480,461 Total investment gain 11,628,827 12,237,052 1,543,275 2,550,921 10,085,552 9,686,131 Expenses Performance fee 1,451, ,948-1,343,713 - Management fee 562, , , , , ,080 Administration fee 45,436 52,953 21,681 29,256 23,755 23,697 Depositary fee 25,366 31,200 9,562 16,722 15,804 14,478 Trustee fee 8,038 11,608 2,972 6,688 5,066 4,920 Other expenses 43, ,250 27,703 79,983 15,678 86,267 Total operating expenses 2,136, , , ,988 1,745, ,442 Operating gain 9,492,409 11,316,622 1,152,794 2,091,933 8,339,615 9,224,689 Finance costs Interest expenses 63,243 65, ,087 62,249 54,515 Total finance costs 63,243 65, ,087 62,249 54,515 Gain before tax 9,429,166 11,251,020 1,151,800 2,080,846 8,277,366 9,170,174 Withholding tax 2 63,918 42, ,918 42,351 Increase in net assets from operations attributable to redeemable participating shareholders 9,365,248 11,208,669 1,151,800 2,080,846 8,213,448 9,127,823 All amounts above relate to continuing operations. The accompanying notes form an integral part of these financial statements. There are no recognised gains or losses arising in the period, other than those dealt with in the income statement. In arriving at the results of the financial period, all amounts relate to continuing operations. 11

13 Statement of Changes in Net Assets Attributable to Redeemable Participating Shareholders for the six month period ended 31 December 2017 New New New New New New Capital Capital Capital Capital Capital Capital Multi-Hedge Multi-Hedge Tactical Tactical Alternative Alternative Focus Focus Opportunities Opportunities Strategies plc Strategies plc Fund Fund Funds Funds 31 December 31 December 31 December 31 December 31 December 31 December Net assets attributable to redeemable participating shareholders at start of period 77,645, ,863,304 28,309,138 69,696,679 49,336,607 47,166,625 Share transactions Proceeds from redeemable participating shares issued 4,988,716 1,980,000 4,314, ,600 1,980,000 Cost of redeemable participating shares redeemed (5,487,998) (42,891,775) (1,492,275) (31,610,552) (3,995,723) (11,281,223) (499,282) (40,911,775) 2,821,841 (31,610,552) (3,321,123) (9,301,223) Increase in assets from operations attributable to redeemable participating shareholders from operations 9,365,248 11,208,669 1,151,800 2,080,846 8,213,448 9,127,823 Net assets attributable to redeemable participating shareholders at end of period 86,511,711 87,160,198 32,282,779 40,166,973 54,228,932 46,993,225 The accompanying notes form an integral part of these financial statements. 12

14 Notes to the Semi-Annual Report 1. General New Capital Alternative Strategies plc (the Company ) was incorporated under the laws of the Republic of Ireland as an investment company with variable capital, registered number , on 24 July The Company is authorised by the Central Bank of Ireland pursuant to the provision of Part 24 of the Companies Act, 2014 (as amended). The Company is an umbrella fund with segregated liability between sub-funds. Accordingly any liability incurred on behalf of or attributable to any sub-fund of the Company shall be discharged solely out of the assets of the sub-fund, and neither the Company nor any director, receiver, examiner, liquidator, provisional liquidator or other person shall apply, nor be obliged to apply the assets of any such sub-fund in satisfaction of any liability incurred on behalf of or attributable to any other sub-funds of the Company irrespective of when such liability was incurred. The sub-funds of the Company as at 31 December 2017 are as follows: Fund Name New Capital Multi-Hedge Focus Fund (Formerly known as New Capital All Weather Fund) New Capital Tactical Opportunities Fund Functional Currency US dollar US dollar The semi-annual report is prepared in US dollars under the historical cost convention as modified by the revaluation of financial assets and financial liabilities held at fair value through profit or loss and in accordance with the provisions of the Companies Act The Condensed Financial Statements have been prepared in accordance with Financial Reporting Standards 104 Interim Financial Reporting ( FRS 104 ) issued by the Financial Reporting Council and promulgated by the International Accounting Standards Board ( IASB ) in IAS 34 Interim Financial Reporting. FRS 104 replaces ASB (Accounting Standards Board)Statement semi-annual financial reports. The comparative figures included for the Statement of Net Assets are as at 30 June 2017, while the comparative figures included for the Statement of Operations and Statement of Changes in Net Assets Attributable to Redeemable Participating Shareholders relate to the six month period ended 31 December The Company meets all the conditions set out in FRS 102, Section 7, and consequently has availed of the exemption available to certain funds not to prepare a Statement of Cash Flows. The accounting policies used in the preparation of these Financial Statements are in accordance with FRS 104 which is similar with Company s most recent annual Financial Statements for the year ended 30 June 2017 which has adapted FRS 102. However the format of these Financial Statements differs in some respects from that of the most recent annual Financial Statements, in that the notes to the Financial Statements are presented in summary form. EFG Asset Management (UK) Limited is authorised to act as the AIFM of Alternative Investment Funds ( AIF s), including acting as the AIFM of the Company. The AIFM has in good faith and in the interests of the shareholders delegated certain activities to third party service providers. Any delegation employed by the AIFM is based on objective reasons, taking into account the following criteria: (a) optimising business functions and processes; (b) cost savings; (c) the expertise of the delegate(s) in administration or in specific markets or investments; (d) the access of the delegate(s) to global trading capabilities; and/or (e) other considerations. The structure ensures (through effective monitoring and supervision and oversight and responsibilities retained by the AIFM) that delegation does not result in an avoidance of the AIFM s responsibilities or liabilities. Under AIFMD, the AIFM has certain responsibilities in relation to the proper and independent valuation of the Company s assets and the calculation and publication of the Net Asset Value (the NAV ) and the Net Asset Value per Share (the NAVPS ). The Company has appointed the AIFM to be responsible for (i) the proper valuation of the Company s assets, (ii) the calculation of the NAV of the Company and the net assets and NAVPS of each Class and (iii) publication of the NAV of the Company and the NAVPS of each class. The Company has, in consultation with the AIFM appointed HSBC Securities Services (Ireland) DAC (the Administrator ) to calculate and publish the NAV of the Company and, the net assets and the NAVPS of each Class, in each case in accordance with the valuation policy of the Company. 2. Taxation Under current law and practice the Company qualifies as an investment undertaking as defined in Section 739B of the Taxes Consolidation Act, 1997, as amended (the TCA ). On that basis, it is not chargeable to Irish tax on its income or gains. However, Irish tax may arise on the occurrence of a chargeable event. A chargeable event includes any distribution payments to shareholders or any encashment, redemption, transfer or cancellation of shares and any deemed disposal of shares for Irish tax purposes arising as a result of holding shares in the Company for a period of eight years or more. No Irish tax will arise in respect of chargeable events in respect of a shareholder who is an Exempt Irish Investor (as defined in Section 739D of the TCA) or who is neither Irish resident nor ordinarily resident in Ireland for tax purposes at the time of the chargeable event, provided, in each case, that an appropriate valid declaration in accordance with Schedule 2B of the TCA is held by the Company and the Company is not in possession of any information which would reasonably suggest that the information contained therein is no longer materially correct or where the Company has been authorised by Irish Revenue to make gross payments in absence of appropriate declarations. The Alternative Investment Fund Manager ( AIFM ) has appointed EFG Asset Management (Switzerland) SA as the investment manager ( The Investment Manager ) for New Capital Multi-Hedge Focus Fund on 18 April, The Investment Manager is subject to supervision by Swiss Financial Market Supervisory Authority ( FINMA ) in Switzerland. 13

15 Notes to the Semi-Annual Report (continued) 2. Taxation (continued) A chargeable event will not arise, if at the time of the chargeable event, appropriate equivalent measures have been put in place by the Company to ensure that shareholders in the Company are neither Irish resident nor ordinarily resident in Ireland and the Company has received approval from the Irish Revenue Commissioners to this effect and the approval has not been withdrawn. To the extent that equivalent measures apply, the Company will not be required to obtain nonresident declarations from investors. Distributions, interest and capital gains (if any) received on investments made by the Company 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. 3. Fair value hierarchy FRS 104 requires the Company to classify financial instruments measured at fair value into the following hierarchy: Level 1: Instruments fair valued using a quoted price for an identical asset or liability in an active market. Quoted in an active market in this context means quoted prices are readily and regularly available and those prices represent actual and regularly occurring market transactions on an arm's length basis. Level 2: Instruments for which a quoted price is unavailable and which have been fair valued using the price of a recent transaction for an identical asset or liability provided there has not been a significant change in economic circumstances or a significant lapse of time since the transaction took place. Level 3: Instruments for which fair value has been estimated using a valuation technique. Valuation techniques classified in Level 3 are intended to provide a reasonable estimate of fair value and reflect how the market could be expected to price the asset or liability, including market expectations and risk return factors. Classification in Level 3 does not distinguish between valuation techniques based on the observability of inputs to those valuation techniques. The tables below set out the classification of the Company's financial instruments measured at fair value in accordance with FRS102 as at 31 December New Capital Multi-Hedge Focus Fund Level 1 Level 2 Level 3 Total Financial assets designated at fair value through profit or loss at inception Investment funds - 23,609,279 39,630 23,648,909 Derivatives - 46,223-46,223 Total assets - 23,655,502 39,630 23,695,132 Financial liabilities designated at fair value through profit or loss at inception Derivatives - (32,070) - (32,070) Total liabilities - (32,070) - (32,070) The following table analyses within the fair value hierarchy the subfund s financial assets and liabilities measured at fair value at 30 June 2017: Financial assets designated at fair value through profit or loss at inception Level 1 Level 2 Level 3 Total Investment funds - 28,383,720 55,011 28,438,731 Derivatives - 37,630-37,630 Total assets - 28,421,350 55,011 28,476,361 Financial liabilities designated at fair value through profit or loss at inception Derivatives - (252,963) - (252,963) Total liabilities - (252,963) - (252,963) As at 31 December 2017 and 30 June 2017 the following sidepockets were held: As at 31 December 2017: Value New Capital Multi-Hedge Focus of holding % of Fund sub-fund Bennelong Asia Pacific Multi Strategy 39,

16 Notes to the Semi-Annual Report (continued) 3. Fair value hierarchy (continued) As at 30 June 2017: Value New Capital Multi-Hedge Focus of holding % of Fund sub-fund Bennelong Asia Pacific Multi Strategy 40, As at 31 December 2017 and 30 June 2017, the following investments were in liquidation: As at 31 December 2017: Value New Capital Multi-Hedge Focus of holding % of Fund sub-fund Absolute Return Europe Fund - - Absolute Return Europe Fund EUR - - As at 30 June 2017: Value New Capital Multi-Hedge Focus of holding % of Fund sub-fund Absolute Return Europe Fund - - Absolute Return Europe Fund EUR - - The following table analyses the fair value hierarchy the sub-fund s financial assets and liabilities measured at fair value at 31 December 2017: New Capital Tactical Opportunities Fund Financial assets designated at fair value through profit or loss at inception Level 1 Level 2 Level 3 Total Equities 59,226, ,226,451 Derivatives 63, , ,848 Total assets 59,289, ,755-59,448,299 The following table analyses within the fair value hierarchy the subfund s financial assets and liabilities measured at fair value at 30 June 2017: Financial assets designated at fair value through profit or loss at inception Level 1 Level 2 Level 3 Total Equities 54,498, ,498,294 Derivatives 7, , ,754 Total assets 54,506, ,844-54,611,048 Liabilities Financial liabilities held for trading Derivatives (21,360) (1,369) - (22,729) Total liabilities (21,360) (1,369) - (22,729) As at 31 December 2017 and 30 June 2017 the following positions held had suspended dealing: As at 31 December 2017: New Capital Tactical Opportunities Fund Value of holding % of sub-fund China Hongxing Sports - - * The Fund holds 7,875,000 units with zero market value. As at 30 June 2017: New Capital Tactical Opportunities Fund Value of holding % of sub-fund China Hongxing Sports* - - * The Fund holds 7,875,000 units with zero market value. Liabilities Financial liabilities held for trading Derivatives - (1,283) - (1,283) Total liabilities - (1,283) - (1,283) 15

17 Notes to the Semi-Annual Report (continued) 3. Fair value hierarchy (continued) Forward currency contracts A forward contract obligates the Company to receive or deliver a fixed quantity of foreign currency at a specified price on an agreed future date. These contracts are valued at the forward rate and the Company s equity therein, representing unrealised gains or losses on the contracts, is included in financial assets or financial liabilities at fair value through profit or loss in the Statement of Net Assets. Realised and change in unrealised fair value gains and losses are included in the Statement of Operations. The Company enters into forward foreign exchange contracts in order to hedge against currency exchange rate risk of the non-base currency classes. Futures Contract A futures contract obligates the Company to receive or deliver a specific instrument at a specified price on an agreed future date. Initial margin deposits made with respect to futures contracts are recognised as assets due from the Company s broker (the Company s agent in acquiring the futures position). Futures contracts are recorded on the trade date and are valued at the applicable last traded price on the last business day of the period. The difference between the original contract amount and the fair value of the open futures position is reflected as financial assets or financial liabilities at fair value through profit or loss in the Statement of Net Assets and as net gains on investments and foreign currency in the Statement of Operations. Realised and unrealised fair value gains and losses are included in the Statement of Operations. 16

18 Notes to the Semi-Annual Report (continued) 4. Gains/(Losses) on fair value of financial assets and liabilities at fair value through profit or loss for the six month period ended 31 December 2017: Realised gain: New Capital Multi-Hedge Focus Fund New Capital Tactical Opportunities Fund Investment funds 631,406 - Equities - 2,364,500 Futures - 1,669,392 Forward foreign currency contracts 308, ,535 Total realised gain on financial assets at fair value through profit or loss 939,929 4,737,427 Realised loss: Investment funds (18,580) - Equities - (1,020,390) Futures - (697,322) Forward foreign currency contracts (484,077) (426,785) Total realised loss on financial liabilities at fair value through profit or loss (502,657) (2,144,497) Net realised gain on financial liabilities at fair value through profit or loss 437,272 2,592,930 Realised (loss)/gain on foreign currencies (20,048) 346,447 Net realised gain on financial assets and financial liabilities at fair value through profit or loss and foreign currencies 417,224 2,939,377 Movement in unrealised gain: Investment funds 953,003 - Equities - 9,754,796 Futures - 76,543 Forward foreign currency contracts 299, ,123 Total unrealised gain on financial assets at fair value through profit or loss 1,252,189 9,991,462 Movement in unrealised loss: Investment funds (63,669) - Equities - (3,019,689) Futures - - Forward foreign currency contracts (69,700) (106,126) Total unrealised loss on financial liabilities at fair value through profit or loss (133,369) (3,125,815) Net unrealised gain on financial assets and financial liabilities at fair value through profit or loss 1,118,820 6,865,647 Unrealised gain/(loss) on foreign currencies 15 (2,549) Net unrealised gain on financial assets and financial liabilities at fair value through profit or loss and foreign currencies 1,118,835 6,863,098 Net total gain on fair value of financial assets and liabilities at fair value through profit or loss and foreign currencies 1,536,059 9,802,475 17

19 Notes to the Semi-Annual Report (continued) 4. Gains/(Losses) on fair value of financial assets and liabilities at fair value through profit or loss for the six month period ended 31 December 2016: New Capital Multi-Hedge Focus Fund New Capital Tactical Opportunities Fund Realised gain: Investment funds 2,750,804 Equities Futures 5,634,279 1,519,395 Forward foreign currency contracts 338, ,671 Total realised gain on financial assets at fair value through profit or loss 3,088,814 7,752,345 Realised loss: Investment funds (412,996) Equities Futures (1,613,411) (471,692) Forward foreign currency contracts (628,257) (1,084,604) Total realised loss on financial liabilities at fair value through profit or loss (1,041,253) (3,169,707) Net realised gain on financial liabilities at fair value through profit or loss 2,047,561 4,582,638 Realised gain/(loss) on foreign currencies 124,487 (589) Net realised gain on financial liabilities at fair value through profit or loss and foreign currencies 2,172,048 4,582,049 Movement in unrealised gain: Investment funds 2,668,622 Structured note 79,400 Equities Futures 9,560, ,856 Forward foreign currency contracts 279,920 41,364 Total unrealised gain on financial assets at fair value through profit or loss 3,027,942 10,150,315 Movement in unrealised loss: Equities (2,748,745) (4,861,732) Forward foreign currency contracts (9,306) Total unrealised loss on financial liabilities at fair value through profit or loss (2,748,745) (4,871,038) Net unrealised gain on financial liabilities at fair value through profit or loss 279,197 5,279,277 Unrealised gain/(loss) on foreign currencies 96,247 (380,865) Net unrealised gain on financial liabilities at fair value through profit or loss and Foreign currencies 375,444 4,898,412 Net total gain on fair value of financial assets and liabilities at fair value through profit or loss and foreign currencies 2,547,492 9,480,461 18

20 Notes to the Semi-Annual Report (continued) 5. Transactions and balances Foreign currency transactions are translated into the functional currency of the individual sub-funds using the exchange rates prevailing at the dates of the transactions. The prevailing exchange rates used in transactions at the period end were: 31 December 30 June Euro Hong Kong dollar Japanese yen Pound sterling Singapore dollar Chinese yuan Soft Commission Arrangements During the period, EFG Asset Management (UK) Limited ( EFG ) entered into a Master Research & Brokerage Services Agreement with Sanford C. Bernstein & Co. LLC. (a registered U.S. broker dealer and a member of the Financial Industry Regulatory Authority in the U.S.) and some of its regulated affiliates based in London and Hong Kong (collectively Sanford C. Bernstein ). Pursuant to the agreement, Sanford C. Bernstein executes orders for EFG s customers at EFG s discretion and in consideration of EFG directing such orders to Sanford C. Bernstein, the latter provides/pays for brokerage and research services provided to EFG consistent with the safe harbour under Section 28 (e) of the Exchange Act, Section 11.6 of the FCA s Conduct of Business Sourcebook and Section 13 of SFC s Code of Conduct. A percentage of the total commission paid by EFG on behalf of its customers to Sanford C. Bernstein comprises an amount available for payment of brokerage and research services obtained by EFG for its customers and paid by Sanford C. Bernstein. EFG is reasonably satisfied that the brokerage and research services received in return for the commissions (i) reasonably assist EFG in the provision of its services to the Company, (ii) do not, and are not likely to, impair its duty to act in the best interest of the Company and (iii) do not compromise It s ability to comply with its best execution obligations. There were no other commission arrangements entered into during the financial period ended 31 December 2017 and year ended 30 June 2017 other than disclosed above. 7. Related Party and Connected Party Transactions The Company, the AIFM, the Company s Directors and KB Associates are related parties. The Directors interest in the company as at 31 December 2017 is as follows: New Capital Multi-Hedge Focus Fund As at 31 December 2017: Number of shares Sterling class held Value of shareholding in GBP As a percentage of share class Net Asset Value Mozamil Afzal , % As at 30 June 2017: Number of shares Sterling class held Value of shareholding in GBP As a percentage of share class Net Asset Value Mozamil Afzal , % New Capital Tactical Opportunities Fund As at 31 December 2017: Number of shares Sterling class held Value of shareholding in GBP As a percentage of share class Net Asset Value Mozamil Afzal 1, , % As at 30 June 2017: Number of shares Sterling class held Value of shareholding in GBP As a percentage of share class Net Asset Value Mozamil Afzal 1, , % As at 31 December 2017: Number of shares US Dollar class held Value of shareholding in As a percentage of share class Net Asset Value Mozamil Afzal 1, , % As at 30 June 2017: Number of shares US Dollar class held Value of shareholding in As a percentage of share class Net Asset Value Mozamil Afzal 1, , % 19

21 Notes to the Semi-Annual Report (continued) 7. Related Party and Connected Party Transactions (continued) Mozamil Afzal and Steven Johnson were Directors of the Company and also Directors of EFG Asset Management (UK) Limited for the financial period to 31 December Nicholas Carpenter was a Director of the Company and also an employee of the EFG Asset Management (UK) Limited for the financial period to 31 December Frank Connolly is a Director of the Company and also an employee of KB Associates (which provides additional services to the Company). For the period ended 31 December 2017 and 31 December 2016 Frank received a fee of 5,000 per annum as Director of the company of which 1,250 was payable at 31 December 2017 (31 December 2016: 1,250). 9. Subsequent events The Company plans to launch a new sub-fund named New Capital Machine Learning Strategies Fund on 01 April With the launch of this sub-fund, there will be three sub-funds under the Company. Post year end, a decrease in the Depositary fee of 0.02% was implemented. The fee now stands at 0.03% of the NAV of each subfund. There have been no other significant events affecting the Company since the financial period end. 17,379 (31 December 2016:20,579) was earned by KB Associates for consultancy, money laundering reporting officer and company secretarial services provided during the financial period to 31 December These fees are presented exclusive of VAT. The Directors fees for the period to 31 December 2017 are 11,561, (31 December 2016: 13,703) and are included in other expenses on the Statement of Operations. At 31 December 2017 there was an outstanding amount of 12,679 (31 December 2016: 25,000) due to the Directors for fees earned. At 31 December 2017, the following shareholders held over 20% of the issued share capital of the Company. Name of the Shareholder Holding % as at 31 December 2017 Brown Brothers Harriman & Co client account 81.50% Name of the Shareholder Holding % as at 30 June 2017 Brown Brothers Harriman & Co client account 83.34% Other than above the Directors are not aware of any other related party transactions. Connected Party Transactions The Company shall only enter into a transaction with a management company, general partner, depositary, AIFM, investment manager or by delegates or group companies of these ( Connected Parties ) where it is negotiated at arm s length. Transactions must be in the best interests of the Shareholders. The Board is satisfied that there are arrangements (evidenced by written procedures) in place to ensure that the obligations set out above are applied to all transactions with Connected Parties, and the Board is satisfied that transactions with Connected Parties entered into during the period complied with the obligations set out above. 8. Schedule of Investments and Statement of Changes Whilst a Statement of Changes in the composition of the portfolio during the period has not been presented as part of these interim statements, it is available upon request from the Administrator. 20

22 Additional Notes Underlying collective investment schemes of New Capital Multi-Hedge Focus Fund The following table sets out information in respect of the underlying collective investment schemes held as at the financial period ended 31 December The information has been sourced from the underlying collective investment schemes' prospectuses. Collective Investments Schemes Domicile Regulated by Held at financial period end Absolute Return Europe Fund EUR Cayman Islands Cayman Islands Monetary Authority Absolute Return Europe Fund Cayman Islands Cayman Islands Monetary Authority Bennelong Asia Pacific Multi Strategy Equity Fund Limited Jersey Jersey Financial Services Commission Elliott International Limited Cayman Islands Cayman Islands Monetary Authority Millennium Global Emerging Fund Limited Bermuda Bermuda Monetary Authority Millennium International Limited Cayman Islands Cayman Islands Monetary Authority New Capital All Weather UCITS Fund Ireland Central Bank of Ireland Schroder GAIA Fund Luxembourg Grand Duchy of Luxembourg VR Global Offshore Fund Limited Cayman Islands Cayman Islands Monetary Authority Manager /Advisor Management Fee Performance Fee Subscription Fee Redemption fee Absolute Capital Management Holdings Limited 2.00% 20.00% - - Absolute Capital Management Holdings Limited 2.00% 20.00% - - Bennelong Asset Management Limited 2.00% 20.00% - Up to 2 within 1 year Elliott International Capital Advisors Inc. 1.50% % Millennium International Management LP 2.00% 20.00% - - Millennium International Management LP 2.00% 20.00% % within 1 year EFG Asset Management (UK) Limited 0.60% % % 3.00% Schroder Investment Management Limited. 1.25% % 20.00% - - VR Advisory Services Limited 1.50% 20.00% % within 1 year There were no Collective Investment Schemes held by New Capital Tactical Opportunities Fund at 31 December

23 Additional Notes (continued) The following table sets out information in respect of the underlying collective investment schemes held during the financial period ended 31 December The information has been sourced from the underlying collective investment schemes prospectuses. Collective Investments Schemes Domicile Regulated by Held during the financial period JCAM Global Fund Limited Bahamas Financial Services Authority Candlewood Structured Credit Harvest Fund Cayman Islands Cayman Islands Monetary Authority Manager /Advisor Management Fee Performance Fee Subscription Fee Redemption fee James Caird Asset Management Limited 1.00% % 20.00% - - Candlewood Investment Group, LP 1.50% 20.00% - - There were no Collective Investment Schemes held by New Capital Tactical Opportunities Fund at 31 December

24 Additional Notes (continued) Total Expense Ratios to 31 December 2017 Total Expense Ratio New Capital Multi-Hedge Focus Fund US Dollar Class 1.87% Sterling Class 1.87% Euro Class 1.87% New Capital Tactical Opportunities Fund US Dollar Class 1.82% Sterling Class 1.83% Euro Class 1.82% 23

25 Appendix Remuneration policy and procedures: On 25 July 2014, EFG Asset Management (UK) Limited was appointed the Alternative Investment Fund Manager (the AIFM ) to the Company under the AIFM Directive. The AIFM is authorised by the Financial Conduct Authority in the United Kingdom as an alternative investment fund manager pursuant to the AIFM Regulations. The remuneration committee of the AIFM has ultimate responsibility for the design and oversight of the remuneration arrangements. The AIFM has implemented a remuneration policy ( the Policy ), the objective of which is to set remuneration at a level that the AIFM s staff are fairly and responsibly rewarded, in a manner that is appropriately linked to their performance. The policy is also designed to attract, motivate and retain talent. The Policy includes all forms of variable and fixed remuneration that applies to staff of the AIFM. The Company s remuneration policy is regulated by the following legislation: Guidelines on remuneration policies and practices (MiFID) (ESMA/2013/606) Guidelines on sound remuneration policies under the AIFMD (ESMA/2013/232) Questions and Answers - Application of the AIFMD (ESMA/2015/1873) The AIFM has adopted a remuneration policy which is consistent with and promotes sound and effective risk management and does not encourage risk-taking which is inconsistent with the risk profiles, rules or instruments of incorporation of the Alternative Investment Fund s ( AIFs ) that are managed. The remuneration policy is in line with the business strategy, objectives, values and interests of the AIFM and the AIFs it manages, and includes measures to avoid conflicts of interest. Staff engaged in control functions are compensated in accordance with the achievement of the objectives linked to their functions, independent of the performance of the business areas they control. The remuneration committee of the AIFM review the Policy annually or more frequently if required. The Policy is in line with the business strategy and objectives of the AIFM. The AIFM s income is dependent upon assets under management and therefore the profit available for distribution under the Policy is dependent upon the performance of the Company. Risk disclosures: The AIFM delegates certain portfolio management and risk management functions in respect of the Company. It may in its discretion decide the extent to which it will delegate portfolio management and risk management and accordingly the individual delegates may be afforded differing levels of responsibilities and remuneration. The AIFM will use best efforts to ensure that: a) the entities to which portfolio or risk management activities have been delegated are subject to regulatory requirements on remuneration that are equally as effective as those applicable under the relevant ESMA guidelines; or b) appropriate contractual arrangements are put in place to ensure that there is no circumvention of the remuneration rules set out in the relevant ESMA guidelines. The remuneration policy includes special remuneration rules for identified staff (senior management, risk takers and staff engaged in control functions). Where remuneration is performance related, the total amount of remuneration is based on a combination of the assessment of the performance of the individual and of the business unit or AIF concerned and of the overall results of the AIFM, and when assessing individual performance, financial as well as non-financial criteria are taken into account. Where remuneration is performance related, 25% of the remuneration is deferred over a period of three years. The variable remuneration, including the deferred portion, is paid only if it is sustainable according to the financial situation of the AIFM as a whole, and justified according to the performance of the business unit, the AIF and the individual concerned. 24