EMERGING MARKETS EQUITY UNIT TRUST

Transcription

1 EMERGING MARKETS EQUITY UNIT TRUST FOR THE PERIOD ENDED 30 SEPTEMBER 2015

2 Manager St. James's Place Unit Trust Group Limited PO Box 9034, Chelmsford, CM99 2XA United Kingdom Freephone: (Authorised and regulated by the Financial Conduct Authority) Directors of the Manager D. C. Bellamy A. M. Croft I. S. Gascoigne D. J. Lamb Investment Adviser Wasatch Advisors Inc. 3rd Floor 505 Wakara Way Salt Lake City UT United States of America (Authorised and regulated by the Securities and Exchange Commission) Trustee BNY Mellon Trust & Depositary (UK) Limited 160 Queen Victoria Street London, EC4V 4LA United Kingdom (Authorised and regulated by the Financial Conduct Authority) Registrar International Financial Data Services (UK) Limited IFDS House St. Nicholas Lane Basildon, SS15 5FS United Kingdom (Authorised and regulated by the Financial Conduct Authority) Independent Auditor PricewaterhouseCoopers LLP Atria One 144 Morrison Street Edinburgh, EH3 8EX United Kingdom Prospectus and Manager's Reports Copies of the up to date Prospectus (Scheme Particulars) and latest Manager's Report and Financial Statements for the range of St. James's Place Unit Trusts can be requested from a member of the St. James's Place Partnership or, at any time during normal business hours, from the Administration Centre at PO Box 9034, Chelmsford CM99 2XA. Freephone:

3 Report of the Manager During the period under review, 1 April 2015 to 30 September 2015, the St. James's Place Emerging Markets Equity Unit Trust Income unit offer price fell by 20.0% from 114.1p to 91.31p and the Accumulation unit offer price (in which revenue is reflected in the price rather than distributed) fell by 20.0 % from 114.1p to 91.31p. The Manager's Report consists of Report of the Manager, The Trust's Performance, Investment Adviser's Comments, Risk and Reward Profile and Portfolio Statement. The Trust's Performance The performance of the Trust since its launch in April 2014 and over the period under review is shown below, together with figures for the most commonly quoted indices in comparable markets where the major proportion of the Trust has been invested. St. James's Place Emerging Markets Equity Unit Trust Income units (offer to offer) Accumulation units (offer to offer) Indices - actual MSCI Emerging Markets (Total Return) Source: Lipper for Fund returns 28/04/14 to 31/03/15 to 30/09/15 30/09/15 % change % change REMEMBER THAT THE PRICE OF UNITS AND REVENUE FROM THEM MAY GO DOWN AS WELL AS UP. PLEASE BE AWARE THAT PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE. Investment Adviser's Comments The portfolio underperformed the broader emerging markets over the reporting period, in what was a challenging backdrop for the region. Slowing growth in China and a steep drop in the country s stock market raised concerns about the health of the global economy. Falling prices for oil and other commodities also impacted emerging markets. China s surprise move in August to devalue its currency seemed to unnerve investors, even as the prospect of higher US interest rates threatened to lure capital away from developing nations. Although we focus mainly on companies tied to demand in their home countries, the portfolio declined along with equities in general across the globe. Our holdings with significant exposure to the global economy outside of their domestic markets were unsurprisingly some of our worst performers. Our strongest contributors to performance for the period were Grupo Aeroportuario del Pacifico SAB de CV and Glenmark Pharmaceuticals Limited. Grupo Aeroportuario holds concessions to develop, operate and maintain airports in Mexico. Increasing air travel in Mexico continues to fuel the company s growth. Glenmark, an Indian drug maker, benefited from the continued growth of its US business. Two of our largest detractors over the period were International Container Terminal Services, Inc. of the Philippines and Qualicorp S.A., the Brazilian insurance broker. International Container fell on concerns about slowing global trade. We sold Qualicorp due to our belief that Brazil s economic backdrop will continue to deteriorate. We expect weak commodity prices and difficult political situations to pose additional challenges for a number of emerging markets, including Brazil, Indonesia, Russia, South Africa and Turkey. The portfolio currently holds no investments in Russia and we ve recently reduced exposure to each of these other countries. Our outlook is brighter for India, Mexico and the Philippines. As significant importers of oil, India and the Philippines stand to benefit from the lower price of crude. In addition, we believe favourable demographics and expanding middle classes are likely to drive increasing consumer demand in all three countries. Wasatch Advisors Inc. 13 October

4 Performance Record The St. James's Place Emerging Markets Equity Unit Trust was first offered on 28 April 2014 at an offer price of p per unit. Unit Price History and Record of Net Distributions Paid The record of net distributions paid per unit is shown below: Income Calendar year * Accumulation Calendar year * Net Asset Values Income Year ended March * Accumulation Year ended March * Ongoing Charges Figure Risk and Reward Profile * To 30 September 2015 Net revenue distributed Highest Lowest per 1,000 Invested Offer Bid per unit at 28/04/14 p p p Net revenue distributed Highest Lowest per 1,000 Invested Offer Bid per unit at 28/04/14 p p p Market NAV NAV Units in Issue of Class per Unit '000 p 393, , Market NAV NAV Units in Issue of Class per Unit '000 p 128,257, , ,884, , The Ongoing Charges Figure for the period ended 30 September 2015 was 2.06%. (31 March 2015: 1.98%) for Income units and 2.06% (31 March 2015: 1.98%) for Accumulation units. The Ongoing Charges Figure ('OCF') is the total expenses paid by the Trust in the period, annualised, against its average net asset value. It excludes the cost of buying or selling assets for the Trust (unless these assets are shares of another trust). The OCF can fluctuate as underlying costs change. The synthetic risk and reward indicator for the St. James's Place Emerging Markets Equity Unit Trust, as disclosed in its most recent Key Investor Information Document (KIID), is a 6. It was calculated using indicative performance data for the type of investments held, as the Scheme itself was only launched on 28 April

5 Portfolio Statement as at 30 September 2015 (unaudited) Security Holdings Market Value 000 % of Net Assets BRAZIL (7.93%) 7, BB Seguridade Participacoes 544,691 2, Raia Drogasil 521,467 3, WEG 903,554 2, CAYMAN ISLANDS (0.00%) 5, Value Partners 4,677,800 2, Vipshop ADR 203,612 2, HONG KONG (0.00%) 2, Vitasoy International 2,697,958 2, INDIA (2.76%) 4, Axis Bank GDR 172,917 4, INDONESIA (10.64%) 7, Bank Rakyat Indonesia Persero 7,053,400 2, Jasa Marga Persero 10,468,094 2, Tower Bersama Infrastructure 9,381,543 2, MEXICO (9.69%) 31, Alsea 1,376,000 2, Compartamos 6,050,487 6, Grupo Aeroportuario del Pacifico 1,366,190 7, Grupo Financiero Interacciones 1,915,282 7, Promotora y Operadora de Infraestructura 1,015,512 7, PERU (2.76%) - - PHILIPPINES (14.27%) 16, GT Capital Holdings 299,795 5, International Container Terminal Services 4,900,890 5, Universal Robina 2,119,840 5, SOUTH AFRICA (7.02%) 7, Discovery 699,183 4, Life Healthcare 1,553,900 2, SOUTH KOREA (0.00%) 7, Medy-Tox 31,655 7, SPAIN (2.25%) - - TAIWAN (1.92%) 2, President Chain Store 646,690 2, THAILAND (5.45%) 15, Bangkok Dusit Medical Services 15,539,123 5, CP ALL 5,575,000 4, Kasikornbank 'A' Shares 1,650,800 5, TURKEY (4.43%) 4, BIM Birlesik Magazalar 355,655 4, UNITED ARAB EMIRATES (1.41%) 2, National Bank of Ras Al-Khaimah 2,138,150 2, UNITED KINGDOM (9.14%) 16, St. James's Place Money Market Unit Trust L Acc 15,926,763 16, UNITED STATES (2.87%) 5, MercadoLibre 96,462 5,

6 Portfolio Statement (continued) as at 30 September 2015 (unaudited) Security Holdings Market Value 000 % of Net Assets DERIVATIVES (1.30%) (48) (0.02) Total Return Swaps Macquarie Total Return Swap Asian Paints 1% (3,622,197) /05/2016 Macquarie Total Return Swap Bajaj Finance 1% (4,307,117) /05/2016 Macquarie Total Return Swap Divi Laboratories 1% (5,288,490) (108) (0.06) 31/05/2016 Macquarie Total Return Swap Glenmark (7,368,994) (421) (0.24) Pharmaceuticals 31/05/2016 Macquarie Total Return Swap HCL Technologies 1% (5,422,240) /05/2016 Macquarie Total Return Swap Idea Cellular 1% (3,704,079) (73) (0.04) 31/05/2016 Macquarie Total Return Swap Lupin 1% 31/05/2016 (7,355,671) Macquarie Total Return Swap United Phosphorus 1% 31/05/2016 (3,875,577) (426) (0.24) Investment assets^ 135, Total other assets (net) 41, Net assets 177, Comparative figures shown in brackets relate to 31 March All investments held are listed, unless otherwise stated. Derivative contracts were traded on an eligible derivatives exchange. Stocks shown as ADRs and GDRs represent American Depositary Receipts and Global Depositary Receipts. During the period under review the Manager decided to place some of the sterling cash held on deposit into the St. James s Place Money Market Unit Trust in order to spread risk across a number of institutions. The St. James s Place Money Market Unit Trust is highly liquid and is rated AAA by Standard & Poors. This investment is a related party. ^ Including investment liabilities of ( 1,028K). 5

7 Material Portfolio Changes Cost Purchases 000 St. James's Place Money Market Unit Trust L Acc 10,767 Medy-Tox 8,471 CP ALL 5,108 Grupo Financiero Interacciones 4,911 Value Partners 4,646 Promotora y Operadora de Infraestructura 4,638 MercadoLibre 3,683 Bangkok Dusit Medical Services 3,424 Vipshop ADR 3,413 Vitasoy International 3,110 Proceeds Sales 000 St. James's Place Money Market Unit Trust L Acc 6,883 Metropolitan Bank & Trust 4,407 Sanlam 3,509 CEMEX LatAm 3,371 Coca-Cola Icecek 3,324 BBVA Banco Continental 3,315 Qualicorp 3,174 Bloomberry Resorts 2,479 Bank Negara Indonesia Persero 2,241 Autohome 1,875 This investment is a related party. 6

8 Statement of Total Return for the period 01 April 2015 to 30 September 2015 (unaudited) Income Net capital (losses)/gains Revenue Expenses Interest payable and similar charges Net expenses before taxation Taxation Net expenses after taxation Total return before equalisation Finance costs: Equalisation Change in net assets attributable to unitholders from investment activities 01/04/15 to 30/09/15 28/04/14 to 30/09/ (37,434) 765 1, (1,611) (194) (3) - (85) (81) (89) (6) (174) (87) (37,608) (37,505) 681 Statement of Change in Net Assets Attributable to Unitholders for the period 01 April 2015 to 30 September 2015 (unaudited) 01/04/15 to 30/09/15 28/04/14 to 30/09/ Opening net assets attributable to unitholders 139,208 - Movement due to creation and cancellation of units: Amounts receivable on creation of units 150,055 60,988 Amounts payable on cancellation of units (74,870) (5,768) Dilution levy charged Change in net assets attributable to unitholders from investment activities (see above) Class actions Closing net assets attributable to unitholders 75,185 55, (37,505) ,199 55,918 Comparative information is provided for the Statement of Change in Net Assets Attributable to Unitholders. Since this information is for the prior interim period, the net assets at the end of that period do not correspond to the net assets at the start of the current period. The prices per unit as at 30 September 2015 (unaudited) were: Income units Accumulation units Bid Offer p p

9 Balance Sheet as at 30 September 2015 (unaudited) Assets Fixed assets Investments Current assets Debtors Cash and bank balances Total assets Liabilities Investment liabilities Creditors Other creditors Total liabilities Net assets attributable to unitholders 30/09/15 31/03/ , ,716 2,212 3,119 40,944 21, , ,452 (1,028) - (1,627) (2,244) (2,655) (2,244) 177, ,208 Accounting and Distribution policies for the period 01 April 2015 to 30 September 2015 (unaudited) Basis of accounting The interim financial statements have been prepared under the historical cost basis, as modified by the revaluation of investments, and in accordance with the Statement of Recommended Practice (SORP) for Financial Statements of Authorised Funds issued by the Investment Management Association (IMA) in May 2014 (the IMA SORP 2014) and United Kingdom Generally Accepted Accounting Practice. Adoption of IMA SORP 2014 Changing in accounting policies There have been no changes to the accounting policies as detailed in the audited financial statements for the year end 31 March Changes in presentation The presentation of these financial statements has been changed from the previous period to comply with the requirements of the IMA SORP The main change is: amendments to labelling of some line items within the financial statements. amendments to categorisation of some line items within the financial statements. Directors' Certificate This report is certified in accordance with the requirements of the rules in the Financial Conduct Authority's Collective Investment Schemes Sourcebook. Directors A. M. Croft London D. J. Lamb 26 November

10 General Information The Trust St. James's Place Emerging Markets Equity Unit Trust is an authorised Unit Trust scheme under section 243 of the Financial Services and Markets Act (2000) and is constituted by a Trust Deed dated 8 April The Unit Trust is subject to the rules of the Financial Conduct Authority's Collective Investment Scheme Sourcebook and is classified as a UCITS Scheme. The Trust Manager The Manager of the Trust is St. James's Place Unit Trust Group Limited which is authorised and regulated by the Financial Conduct Authority. Investment Objectives The investment objective of the Scheme is to seek to achieve long-term capital appreciation. The Scheme aims to achieve this objective by primarily investing into a focused portfolio of the securities of companies which are either listed on the exchanges of countries in emerging markets or which are economically exposed to emerging markets. The Scheme is also permitted to invest in other types of transferable securities, UK and overseas fixed interest and index-linked securities, units and/or shares in collective investment schemes, money market instruments, deposits, cash and near cash, and derivatives and forward transactions for the purposes of efficient portfolio management (including hedging). It is the Manager's intention that the assets of the Unit Trust will be invested so that the Unit Trust will be eligible for inclusion in an ISA. Unit Dealings Dealings on the Trust take place on a daily basis. Purchase or sale instructions can be made by telephone or in writing to St. James's Place Unit Trust Group Limited, PO Box 9034, Chelmsford, CM99 2XA, United Kingdom, freephone: The Manager adopts a policy of forward pricing, i.e. the order will be transacted on the dealing day following receipt of the client's instructions, or if received before noon, on that dealing day. In the case of telephone purchases of units from the Manager, settlement must be by return of post after receipt of the contract note. In the case of telephone redemptions, the proceeds will not become payable until the receipt at the Administration Centre of a written request. A contract note confirming the subscription or redemption price and the number of units involved will be forwarded, together with a cancellation notice, where appropriate, on the next business day. The most recent issue and redemption prices will be published on the Manager's website: and are available by calling the Administration Centre on Minimum Investment The minimum lump sum investment is 1,500, thereafter the minimum additional investment is 1,000. The minimum monthly investment is 150 and the minimum monthly increment is 50. The minimum annual investment is 1,500 and the minimum annual increment is

11 General Information (continued) Management Charges With effect from 26 October 2015 the Manager has changed the charging structure of the Scheme. The annual management charge has been increased to include many of the predictable costs, such as trustee fees and administration fees, which were previously charged directly to the Scheme. These changes are therefore presentational only and there is no overall increase in the total charges met by the Scheme. In addition, the way the annual management charge is calculated has been changed. The charge was previously calculated monthly, based on the Scheme value on the first business day of the month; in future it will be calculated daily, based on the Scheme value every day. (a) A Preliminary Charge of 5 per cent which is included in the offer price of the Units. (b) An Annual Management Charge at a rate of 1.37 per cent (1.32 per cent prior to 26 October 2015) of the value of the Trust. Income Distributions Income distributions are made annually on or before the 31 May. Accumulation Distributions Revenue due to accumulation unitholders is reflected in the price of their units. Tax Vouchers Income unitholders that receive income distributions by direct credit and accumulation unitholders (where the distribution income is reinvested) receive an annual consolidated tax voucher in May with all the relevant payment and tax information required to complete a tax return. Tax vouchers will be enclosed if income unitholders receive payment by cheque. Report A report is sent semi-annually to all unitholders on or before 31 May and 30 November. Capital Gains Tax The Trust is not liable to tax on capital gains and any individual holding units will not be liable to capital gains tax unless the total chargeable gains for the tax year 2015/2016 exceed 11,100 (2014/ ,000). To calculate capital gains on accumulation units, the total amount of reinvested net revenue (shown on the annual tax credit vouchers) should be added to the base cost of the units purchased. Unitholders should consult their professional advisers for any advice regarding their tax position. 10

12 St. James s Place Unit Trust Group Ltd is authorised and regulated by the Financial Conduct Authority. St. James s Place Unit Trust Group Ltd Registered Office: St. James s Place House, 1 Tetbury Road, Cirencester, Gloucestershire, GL7 1FP, United Kingdom. Registered in England Number Perivan Financial Print Emerging Markets Equity (11/15)