ABRIDGED ANNUAL REPORT FOR THE YEAR ENDED 31 MARCH 2017

Transcription

1 ABRIDGED ANNUAL REPORT FOR THE YEAR ENDED 31 MARCH 2017

2 CONTENTS PAGE Retail Class Units 3 Unit Trusts 6 Financial Information 30 Trustees Report 34

3 RETAIL CLASS UNITS PRESCIENT S ANNUAL MANAGEMENT FEE (EXCL VAT) Prescient Africa Equity Feeder Fund 1.00% Prescient Africa Sustainable Equity Fund 1.50% Prescient Absolute Balanced Fund 1.00% Prescient Balanced Fund 0.30% Prescient Bond QuantPlus Fund 0.75% Prescient China Balanced Feeder Fund 0.50% Prescient Core Equity Fund 0.30% Prescient Equity Fund 1.00% Prescient Equity Defender Fund 1.00% Prescient Equity Income Fund 1.00% Prescient Equity Top 40 Fund 0.50% Prescient Flexible Fixed Interest Fund 0.50% Prescient Global Positive Return Feeder Fund 0.50% Prescient Global Equity Feeder Fund 0.50% Prescient Global Income Provider Feeder Fund 0.50% Prescient Income Provider Fund 0.75% Prescient Living Planet Fund 1.25% Prescient Money Market Fund 0.35% Prescient Optimised Income Fund 1.20% Prescient Positive Return QuantPlus Fund 0.75% Prescient Property Equity Fund 0.50% Prescient RECM Global Feeder Fund 0.25% Prescient Stable Income Fund 0.75% Prescient Yield QuantPlus Fund 0.50% ABRIDGED ANNUAL REPORT 3

4 RETAIL CLASS UNITS (CONTINUED) DISTRIBUTIONS PRESCIENT S ANNUAL Distributions PAYMENT DATE CENTS PER UNIT Prescient Africa Equity Feeder Fund 1 April Prescient Africa Sustainable Equity Fund 1 April Prescient Absolute Balanced Fund 1 April Prescient Balanced Fund 1 April Prescient China Balanced Feeder Fund 1 April Prescient Core Equity Fund 1 April Prescient Equity Fund 1 April Prescient Equity Defender Fund 1 April Prescient Equity Income Fund 1 April Prescient Equity Top 40 Fund 1 April Prescient Living Planet Fund 1 April Prescient Positive Return QuantPlus Fund 1 April Prescient Property Equity Fund 1 April bi annual Distributions Prescient Bond QuantPlus Fund 1 April October Prescient Flexible Fixed Interest Fund 1 October Note: The Prescient Income Provider, Prescient Money Market, Prescient Stable Income and Prescient Yield QuantPlus Funds distribute monthly. ABRIDGED ANNUAL REPORT 4

5 OUR UNIT TRUSTS PRESCIENT S Prescient Africa Equity Feeder Fund Prescient Africa Sustainable Equity Fund Prescient Absolute Balanced Fund Prescient Balanced Fund Prescient Bond QuantPlus Fund Prescient China Balanced Feeder Fund Prescient Core Equity Fund Prescient Equity Fund Prescient Equity Defender Fund Prescient Equity Income Fund Prescient Equity Top 40 Fund Prescient Flexible Fixed Interest Fund Prescient Global Positive Return Feeder Fund Prescient Global Equity Feeder Fund Prescient Global Income Feeder Fund Prescient Income Provider Fund Prescient Living Planet Fund Prescient Money Market Fund Prescient Optimised Income Fund Prescient Positive Return QuantPlus Fund Prescient Property Equity Fund Prescient RECM Global Feeder Fund Prescient Stable Income Fund Prescient Yield QuantPlus Fund ABRIDGED ANNUAL REPORT 5

6 PRESCIENT AFRICA EQUITY Feeder Benchmark: Johan Steyn, Seeiso Matlanyane Regional Equity General Nedbank All Africa Top 100 ex SA R19.0m Inception date: 31 March 2011 Aggressive The Fund invests in listed equity markets across Africa, excluding South Africa. It aims to achieve returns above the Nedbank All Africa Top 100 ex South Africa Index by investing in shares that are showing value relative to their trading price. The Investment process follows an unbiased, quantitative bottom-up approach which invests in shares with various characteristics that have proven to pay rewards over time. The Fund will favour companies that represent good investment value, superior quality, positive market sentiment and exhibit lower volatility. Political and economic risks are also considered. Blending shares with different characteristics into the Fund helps to deliver a better diversified portfolio which results in improved stability in returns over time. Although the Fund aims to maximise returns over the long-term it is also structured to minimise the risk of underperforming the benchmark. The feeder fund is invested wholly in the Prescient Africa Equity Fund. Botswana 3.00% Egypt 37.60% Kenya 22.00% Mauritius 4.70% Morocco 21.30% Nigeria 11.30% Benchmark 1 Year % % 3 Years (p.a.) -9.01% -0.63% 5 Years (p.a.) 7.03% 12.90% Since inception (p.a.) 6.05% 11.82% ABRIDGED ANNUAL REPORT 6

7 PRESCIENT AFRICA sustainable EQUITY Benchmark: Fairtree Capital Regional Equity General Nedbank All Africa Top 100 ex SA R11.3m Inception date: 03 August 2015 High The objective of the Fund is to provide sustainable long-term capital growth and investment returns that exceed that of the Nedbank All Africa Top 100 benchmark index over rolling five-year periods while also ensuring a high level of sustainability and environmental credibility in the investment portfolio. Egypt 24.00% Morocco 22.00% Nigeria 14.00% Kenya 11.00% Senegal 5.00% Mauritius 5.00% Benchmark (ZAR) BENCHMARK (USD) 1 Year % % -1.83% Since inception (p.a.) % % % ABRIDGED ANNUAL REPORT 7

8 PRESCIENT ABSOLUTE balanced Raphael Nkomo, Haakon Kavli South African Multi-Asset High Equity Benchmark: Headline CPI + 5% R192.4m Inception date: 30 June 2003 Moderate The Fund aims to return CPI + 5% per annum over a full market cycle with less capital risk than the average balanced fund. The Fund invests in a diversified portfolio including cash, capital markets, equities and property, with active asset allocation. Derivatives can be utilised to reduce downside risk when pricing warrants this. The equity selection is active. The Fund is well diversified globally and the offshore allocation and currency exposure is managed actively. Specialist securities 1.99% Derivatives 0.14% Unit trusts 53.19% Bonds 30.62% Cash 14.06% BENCHMARK 1 Year 0.76% 11.62% 3 Years (p.a.) 4.57% 11.02% 5 Years (p.a.) 7.16% 11.07% 10 Years (p.a.) 7.22% 11.71% Since inception (p.a.) 12.20% 11.09% ABRIDGED ANNUAL REPORT 8

9 PRESCIENT BALANCED Haakon Kavli, Raphael Nkomo South African Multi-Asset High Equity Benchmark: FTSE/JSE SWIX 40 (TR) 55.25% All Bond Index (TR) 17.00% SteFI 12.75% MSCI World (TR) 9.75% US 1 Month TB 5.25% R65.0m Inception date: 01 June 2014 Moderately Aggressive The Fund aims to achieve significant real returns over the long term and to outperform the average South African balanced unit trust fund over a full market cycle by maintaining meaningful exposure to growth assets like equities. The Fund invests in equities and interest bearing assets domestically and overseas. The allocation to the various asset classes will typically remain fixed at the benchmark weights but can be varied tactically from time to time to aim for outperformance of the benchmark by capitalising on perceived mispricing in the market. The exposure to the various asset classes will typically be managed on a passive basis. Unit trusts 16.87% Bonds 55.37% Cash 27.76% Benchmark 1 Year 3.07% 2.12% Since inception (p.a.) 7.06% 6.72% ABRIDGED ANNUAL REPORT 9

10 PRESCIENT BOND QuantPlus Fund Benchmark: Guy Toms South African Interest Bearing Variable Term JSE All Bond Index R106.8m Inception date: 30 June 2003 Moderately Conservative The Fund aims to generate returns above the JSE All Bond Index over time, utilising active bond management combined with strategies which aim to reduce risk over time. The Fund invests in cash and high-quality capital market instruments. A number of techniques are used to generate returns, including duration management, yield enhancements via credit exposure and risk management strategies, where these strategies are designed to provide downside protection. Bonds 95.56% Cash 4.44% BENCHMARK 1 Year 11.31% 11.02% 3 Years (p.a.) 7.07% 7.45% 5 Years (p.a.) 6.93% 7.38% 10 Years (p.a.) 8.00% 8.06% Since inception (p.a.) 8.46% 8.67% ABRIDGED ANNUAL REPORT 10

11 PRESCIENT china balanced feeder Fund Benchmark: Liang Du, Shaun Hu Regional Multi-Asset Flexible China CPI + 3% ZAR R125.3m Inception date: 30 April 2013 Aggressive The Fund aims to generate capital growth and to outperform Chinese inflation by 3% over the long-term. Returns can be volatile. The Fund invests predominantly in mainland Chinese equities, bonds, money market and derivative instruments with an active asset allocation overlay. The Fund may also hold instruments listed in Hong Kong. Equity selection focuses on value, quality and momentum reversion. The Fund has a flexible mandate and can vary asset classes from 0% to 100%. Unit trusts 99.79% Cash 0.21% benchmark 1 Year -3.91% -8.28% 3 Years (p.a.) 26.85% 8.83% Since inception (p.a.) 21.72% 13.24% ABRIDGED ANNUAL REPORT 11

12 Prescient core EQUITY Fund Benchmark: Mario Fisher, Seeiso Matlanyane South African Equity FTSE/JSE Africa Shareholder Weighted Index (SWIX) R420.0m Inception date: 31 December 2016 Aggressive The Fund aims to deliver returns close to the FTSE/JSE Africa Shareholder Weighted Total Return Index SWIX at low cost. It is not a tracker fund and can out / underperform the SWIX by small amounts over time. The Fund follows an investment policy which firstly endeavours to follow the composition of the SWIX closely and secondly seeks enhancement opportunities and secure for investors an optimum overall return. In addition to investing in physical assets, the Fund can use derivatives to create exposure to the SWIX or subsets thereof in a low cost and efficient manner. Financials 4.43% Resources 3.85% Industrials 8.42% Property 4.14% Information technology 1.03% Bonds 45.81% Cash 32.32% for 1 year and greater is not available as at 31 March 2017 since the Fund is less than one year old. ABRIDGED ANNUAL REPORT 12

13 Prescient Equity Fund Mario Fisher, Raphael Nkomo South African Equity General Benchmark: FTSE/JSE Africa Shareholder Weighted TR Index (SWIX) R86.5m Inception date: 01 November 2006 Aggressive The Fund aims to achieve returns above the FTSE/JSE Africa Shareholder Weighted Total Return Index (SWIX). The equity selection is done purely on a bottom-up basis and risk is actively managed in the portfolio construction process to eliminate undue stock specific risk. The Fund uses quantitative techniques (multi-factor model) to build an active equity portfolio. The selection process targets those shares that offer the best economic value according to predefined income statement, cash flow statement and balance sheet matrices. The quantitative process maintains some positive index type characteristics, such as low turnover and thus lower cost and high liquidity. Financials 14.10% Resources 12.89% Industrials 39.43% Property 9.23% Information technology 4.75% Derivatives 0.02% Unit trusts 19.88% Cash -0.30% BENCHMARK 1 Year -2.62% 1.59% 3 Years (p.a.) 3.87% 7.08% 5 Years (p.a.) 9.60% 13.27% 10 Years (p.a.) 8.65% 10.61% Since inception (p.a.) 10.03% 12.22% ABRIDGED ANNUAL REPORT 13

14 Prescient Equity defender Fund Benchmark: Bastian Teichgreeber Domestic Asset Allocation Flexible 80% Top 40, 20% STeFI Call R92.1m Inception date: 31 March 2012 Moderate The Fund aims to provide equity-like returns over the long term while aiming to have negative drawdowns that are much lower than the equity market over the shorter term. The Fund replicates the FTSE/JSE Top 40 Index by using futures. A derivative overlay is then applied to the synthetic equities to negate the downside risk associated with equities. The protection levels of the derivatives will differ as the cost of protection differ during different market conditions. Property 1.78% Specialist securities 0.22% Bonds 65.28% Cash 32.72% BENCHMARK 1 Year -0.57% 3.88% 3 Years (p.a.) 1.32% 7.14% 5 Years (p.a.) 5.17% 11.20% Since inception (p.a.) 5.17% 11.20% ABRIDGED ANNUAL REPORT 14

15 PRESCIENT EQUITY INCOME Benchmark: Seeiso Matlanyane, Mario Fisher South African Equity General FTSE/JSE Africa Shareholder Weighted TR Index (SWIX) R11.9m Inception date: 31 March 2012 Aggressive The Fund aims to provide an income from dividends that is greater than the FTSE/JSE Africa Shareholder Weighted Index by investing in shares that offer an attractive yield relative to the benchmark. It further aims to outperform the benchmark over the long-term. The Fund uses quantitative techniques to build a high-income equity portfolio which aims to deliver superior dividend income and performance relative to its benchmark. The selection process targets those shares that offer an attractive dividend yield but screens out high dividend yield shares that are out of favour. A further screen ensures that the portfolio is scalable and maintains high liquidity. Financials 23.94% Resources 14.53% Industrials 40.37% Property 11.04% Information technology 12.23% Derivatives 0.09% Cash -2.20% BENCHMARK 1 Year -0.66% 1.59% 3 Years (p.a.) 3.16% 7.08% 5 Years (p.a.) 9.75% 13.27% Since inception (p.a.) 9.75% 13.27% ABRIDGED ANNUAL REPORT 15

16 PRESCIENT EQUITY top 40 Benchmark: Johan Steyn, Mario Fisher South African Equity Large Cap FTSE/JSE Africa Top 40 Index R182.6m Inception date: 30 June 2003 Aggressive The Fund aims to outperform the FTSE/JSE Africa Top 40 index. Tracking error to the index is minimised in the process. The Fund is an equity index fund where returns are enhanced by taking advantage of low risk arbitrage opportunities in the market. Additional benefits are gained from efficient implementation of cash flows, dividend reinvestments, management of corporate actions, use of future discounts and index rebalancing. The Fund aims to remain fully invested in equities at all times. Financials 8.99% Resources 12.46% Industrials 26.46% Property 2.11% Information technology 2.93% Derivatives 0.02% Bonds 11.79% Cash 35.24% BENCHMARK 1 Year 0.07% 0.72% 3 Years (p.a.) 4.15% 4.66% 5 Years (p.a.) 11.52% 12.07% 10 Years (p.a.) 9.12% 9.29% Since inception (p.a.) 17.05% 16.97% ABRIDGED ANNUAL REPORT 16

17 PRESCIENT Flexible Fixed Interest Benchmark: Guy Toms South African Interest Bearing Variable Term JSE All Bond Index R1.9bn Inception date: 31 July 2016 Conservative The Fund aims to outperform both JSE All Bond Index and the STeFI Call Index over time, utilising active bond and cash management combined with strategies which aim to reduce risk over time. The Fund invests in cash and high-quality capital market instruments. A number of techniques are used to generate returns, including duration management, yield enhancements via credit exposure and risk management strategies, where these strategies are designed to provide downside protection. Specialist securities 2.59% Bonds 74.02% Cash 23.39% *BENCHMARK Since inception (p.a.) 6.90% 4.01% ABRIDGED ANNUAL REPORT 17

18 Prescient GLOBAL POSITIVE RETURN FEEDER Fund Bastian Teichgreeber, Guy Toms Global Multi-Asset Medium Equity Benchmark: EU Harmonised CPI + 1% R3.0m Inception date: 05 September 2007 Moderately Aggressive The Fund is priced in Rands and aims to outperform G7 inflation in Euro terms over time while aiming to limit capital losses. The Fund invests in money market instruments, capital market instruments and equities with an active asset allocation overlay. The equity component of the Fund is always protected. As the underlying Fund is priced in Euro s the exchange rate volatility between Euro s and Rands is reflected in the price. The feeder fund is invested wholly in the Prescient Global Positive Return Fund. Unit trusts 99.27% Cash 0.73% BENCHMARK 1 Year % % 3 Years (p.a.) -1.55% -1.08% 5 Years (p.a.) 7.96% 7.41% Since inception (p.a.) 2.81% 5.45% *G7 Inflation from inception of the Fund to December 2008 and EU Harmonised CPI +1% thereafter. ABRIDGED ANNUAL REPORT 18

19 Prescient GLOBAL EQUITY FEEDER Fund Benchmark: Mario Fisher Global Equity General MSCI World Index (ZAR) R6.0m Inception date: 30 June 2014 Moderately aggressive The Fund is an actively managed global equity fund that aims to outperform the MSCI World Index in Rands over time. The Fund is fully invested in equities and is structured to minimise the risk of underperforming the benchmark by investing in a diversity of risk premia and blending those strategies to reduce relative market risk over time. The equity selection process targets those shares that offer value and is supported by positive market sentiment. The feeder fund is invested wholly in the Prescient Global Equity Fund. Unit trusts 99.69% Cash and cash equivalents 0.31% benchmark 1 Year 2.62% 1.37% Since inception (p.a.) 10.40% 11.18% ABRIDGED ANNUAL REPORT 19

20 Prescient GLOBAL INCOME PROVIDER FEEDER Fund Benchmark: Guy Toms, Jean-Pierre du Plessis Global Multi-Asset Income US CPI + 1% (ZAR) LAG R130.3m Inception date: 04 December 2004 Moderately aggressive The Fund aims to generate real returns in US Dollars and is benchmarked to the US inflation rate, converted to Rands. The investment universe includes fixed, floating, real and nominal money market and bond market investments, property, derivatives and global currencies. Fund performance can be generated from taking interest rate views or duration, yield enhancement via credit instruments, asset allocation between income producing asset classes, the use of derivatives and currency management. Focus is placed on maintaining the high credit quality of the Fund. The feeder fund is invested wholly in the Prescient Global Income Fund. Unit trusts 99.79% Cash and cash equivalents 0.21% Fund BENCHMARK 1 Year -3.92% -7.33% 3 Years (p.a.) 11.46% 9.18% 5 Years (p.a.) 14.51% 12.07% 10 Years (p.a.) 8.58% 6.93% Since inception (p.a.) 8.77% 7.81% ABRIDGED ANNUAL REPORT 20

21 Prescient INCOME provider Fund Guy Toms, Farzana Bayat, Jean-Pierre du Plessis South African Multi-Asset Income Benchmark: SteFi Call 110% R17.1bn Inception date: 31 December 2005 Conservative The Fund aims to return CPI + 3% per annum through a full interest rate cycle while providing stability by aiming never to lose capital over any rolling 3 month period. This Fund invests in local and offshore money market, bonds, property, preference shares, inflation-linked bonds and derivatives to meet the investment objectives. Fund performance can be generated from taking interest rate views or duration, yield enhancement via credit instruments, asset allocation between income producing asset classes, offshore exposure and also via the use of derivatives. Property 2.73% Specialist securities 2.95% Unit trusts 16.30% Bonds 43.07% Cash 34.95% BENCHMARK 1 Year 9.25% 7.67% 3 Years (p.a.) 9.85% 6.81% 5 Years (p.a.) 9.49% 6.25% 10 Years (p.a.) 9.44% 7.47% Since inception (p.a.) 9.66% 7.55% ABRIDGED ANNUAL REPORT 21

22 Prescient living planet Fund Hendrik Pfaff ASISA Multi-Asset High Equity Benchmark: 60% JSE All Share Index 20% SA All Bond Index 10% MSCI World Index 10% BarCap Global Aggregate Index R697.0m Inception date: 31 May 2012 Moderate The objective of the Fund is to deliver sustainable long-term capital growth for its investors within a framework that works towards/desires the protection of the natural environment over the long term. The Fund targets a return of CPI + 4% over rolling five-year periods and volatility is expected to be less than that of a pure equity fund. Financials 10.33% Resources 6.51% Industrials 17.71% Property 2.30% Information technology 2.19% International equities 6.40% Derivatives 0.01% Unit trusts 45.47% Bonds 2.58% Cash 6.50% BENCHMARK 1 Year 0.53% 3.30% Since inception (p.a.)* 7.60% 9.94% * track record was lost due to the fund changing from a South African Equity General classification to a South African Multi-Asset High Equity classification in April ABRIDGED ANNUAL REPORT 22

23 Prescient money market fund Benchmark: Farzana Bayat, Terri McGregor South African Interest Bearing Money Market SteFi Call R2.0bn Inception date: 30 September 2009 Conservative The Fund aims to achieve returns above the STeFI Call Index, while minimising the risk of any underperformance. Importantly, the Fund is managed conservatively and it aims to maintain capital stability and liquidity. The Fund invests in cash and high-quality capital market instruments. The Fund is structured to minimise the risk of not meeting the benchmark. Returns achieved above the benchmark are used in specialist strategies designed to enhance yield further. Cash and cash equivalents % BENCHMARK 1 Year 7.94% 6.95% 3 Years (p.a.) 7.03% 6.17% 5 Years (p.a.) 6.36% 5.67% Since inception (p.a.) 6.49% 5.72% ABRIDGED ANNUAL REPORT 23

24 Prescient OPTIMISED INCOME Fund Meyer Coetzee South African Multi-Asset Flexible Benchmark: STeFI Call 83% R161.6m Inception date: 31 March 2016 Conservative The Fund aims to deliver returns that exceed the after-tax returns of money market funds. It is managed conservatively and it aims to maintain capital stability and liquidity. The Fund invests predominantly in local listed shares which are fully protected by overlay strategies provided by the big 5 South African banks, as well as money market instruments to meet liquidity requirements. The Fund s income is largely derived through dividends received from the listed counters. Unit trusts 19.95% Cash 80.05% BENCHMARK 1 Year 5.83% 5.74% Since inception (p.a.) 5.83% 5.74% ABRIDGED ANNUAL REPORT 24

25 Prescient Positive Return QuantPlus Fund Guy Toms, Bastian Teichgreeber South African Multi-Asset Medium Equity Benchmark: Headline CPI + 3% R1.4bn Inception date: 30 April 2004 Moderately Conservative The Fund aims to return CPI + 4% per annum over the medium term by generating consistent positive returns while protecting capital over rolling 12-month periods. The Fund invests in cash, capital market instruments and equities with an active asset allocation overlay. The equity component of the Fund is protected to reduce the risk of capital loss. The Fund is thus structured to optimise returns in positive market cycles and to protect capital during negative periods/cycles. Financials 3.30% Resources 3.33% Industrials 2.10% Property 1.39% Information technology 1.21% Specialist securities 1.48% Unit trusts 49.73% Bonds 24.67% Cash 12.79% BENCHMARK 1 Year 3.58% 9.49% 3 Years (p.a.) 4.56% 8.90% 5 Years (p.a.) 6.23% 8.96% 10 Years (p.a.) 6.83% 9.58% Since inception (p.a.) 9.54% 9.04% ABRIDGED ANNUAL REPORT 25

26 Prescient property equity Fund Benchmark: Johan Steyn, Mario Fisher South African Real Estate General FTSE/JSE Africa SA Listed Property Index R207.4m Inception date: 30 April 2007 Aggressive The Fund offers efficient and cost-effective exposure to listed property as represented by the FTSE/JSE SA Listed Property Index. Tracking error to the index is minimised in the process. The Fund is a property index fund where returns are enhanced by taking advantage of low risk arbitrage opportunities in the market. Additional benefits are gained from efficient implementation of cash flows, dividend reinvestments, management of corporate actions and index rebalancing. The Fund aims to remain fully invested in property shares at all times. Property % Unit trusts 0.57% Cash -5.07% benchmark 1 Year 1.30% 1.46% 3 Years (p.a.) 15.09% 14.48% 5 Years (p.a.) 15.56% 15.81% Since inception (p.a.) 12.78% 13.50% ABRIDGED ANNUAL REPORT 26

27 Prescient recm global feeder Fund Benchmark: Piet Viljoen, Paul Whitburn Global Multi-Asset Flexible US CPI + 6% p.a. (ZAR) R510.5m Inception date: 24 July 2014 Moderate to High The Prescient RECM Global Feeder Fund is a Rand denominated unit trust fund that provides local investors with access to the RECM Global Fund (Master Fund). The Master Fund is a US dollar denominated global fund that may invest in a wide array of assets without any restrictions. The Master Fund s aim is to generate returns significantly greater than US inflation and commensurate with equities over the long term. The Master Fund invests mainly in large global companies at a significant discount to intrinsic value, while using the flexibility of the mandate to protect capital and enhance returns by investing in other mispriced global assets from time to time. We consider risk as the possibility of losing money, not in terms of volatility. Our main risk management tool is our investment philosophy. As value investors, we aim to buy and hold good quality companies and do so with a margin of safety. Our ability to move between asset classes assists in reducing risk. SECTOR allocation Unit trusts 98.34% Cash and cash equivalents 1.66% Fund BENCHMARK 1 Year 4.20% -1.20% Since inception (p.a.) 0.00% 16.70% ABRIDGED ANNUAL REPORT 27

28 Prescient stable Income Fund Guy Toms, Farzana Bayat South African Multi-Asset Income Benchmark: SteFI 110% R5.1bn Inception date: 31 March 2013 Conservative The Fund aims to return CPI + 3% per annum through a full interest rate cycle while providing stability by aiming never to lose capital over any rolling 3-month period. The Fund invests in local money market, bonds, inflation-linked bonds, preference shares and derivatives to meet the investment objectives. Fund performance can be generated from taking interest rate views or duration, yield enhancement via credit instruments, asset allocation between income producing asset classes and also via the use of derivatives. Property 0.69% Specialist securities 3.23% Bonds 69.82% Cash and cash equivalents 26.26% benchmark 1 Year 9.06% 7.67% 3 Years (p.a.) 7.76% 6.81% Since inception (p.a.) 7.34% 6.45% ABRIDGED ANNUAL REPORT 28

29 Prescient Yield QuantPlus Fund Benchmark: Farzana Bayat; Terri McGregor South African Interest Bearing Short Term SteFI Call R3.9bn Inception date: 30 June 2003 Conservative The Fund aims to achieve returns above the STeFI Call Index and the average money market fund, while minimising the risk of any underperformance. Importantly, the Fund is managed conservatively and it aims to maintain capital stability and liquidity. The Fund invests in cash, money market and high-quality capital market (nominal or real) instruments including structured notes. Fund performance can be generated from taking interest rate or duration views, yield enhancement via credit instruments and also via the use of derivatives. The average duration of the portfolio will not exceed 9 months (or 270 days) and the maximum single instrument maturity is limited to 36 months. Bonds 49.31% Cash and cash equivalents 50.69% *BENCHMARK 1 Year 8.34% 6.95% 3 Years (p.a.) 7.30% 6.17% 5 Years (p.a.) 6.71% 5.67% 10 Years (p.a.) 7.70% 6.56% Since inception (p.a.) 7.82% 6.72% *IBCR from inception of the Fund to September 2011 and SteFI Call thereafter. ABRIDGED ANNUAL REPORT 29

30 OUR FINANCIAL INFORMATION Statement of Financial Position Prescient Funds R 000 Prescient Prescient Prescient Prescient Prescient Prescient Africa Equity Africa Absolute Balanced Bond China Feeder Sustainable Equity Balanced Fund QuantPlus Balanced Feeder Fund Fund Fund Fund Fund ASSETS Securities at market value Other assets Total Total unitholder funds Total liabilities Total Net income/(deficit) (6 747) (1 356) (7 835) (5 949) Total finance costs Undistributed income/(deficit) at year end (6 747) (1 651) (16 753) (3 468) (5 987) ABRIDGED ANNUAL REPORT 30

31 OUR FINANCIAL INFORMATION Statement of Financial Position Prescient Funds (continued) R 000 Prescient Prescient Prescient Prescient Prescient Prescient Core Equity Equity Equity Equity Flexible Equity Fund Defender Income Top 40 Fixed Interest Fund Fund Fund Fund Fund ASSETS Securities at market value Other assets Total Total unitholder funds Total liabilities Total Net income/(deficit) (12 184) (123) (3 170) Total finance costs Undistributed income/(deficit) at year end (15 530) (1 913) (582) (13 625) (14) ABRIDGED ANNUAL REPORT 31

32 OUR FINANCIAL INFORMATION Statement of Financial Position Prescient Funds (continued) R 000 Prescient Prescient Prescient Prescient Prescient Prescient Global Global Equity Income Income Living Money Positive Return Feeder Provider Provider Planet Market Feeder Fund Fund Feeder Fund Fund Fund Fund ASSETS Securities at market value Other assets Total Total unitholder funds Total liabilities Total Net income/(deficit) (501) 49 (2 731) Total finance costs Undistributed income/(deficit) at year end (517) 49 (2 731) ABRIDGED ANNUAL REPORT 32

33 OUR FINANCIAL INFORMATION Statement of Financial Position Prescient Funds (continued) R 000 Prescient Prescient Prescient Prescient Prescient Prescient Optimised Positive Return Property RECM Stable Yield Income QuantPlus Equity Global Income QuantPlus Fund Fund Fund Feeder Fund Fund Fund ASSETS Securities at market value Other assets Total Total unitholder funds Total liabilities Total Net income/(deficit) Total finance costs Undistributed income/(deficit) at year end - (52 952) (8 119) ABRIDGED ANNUAL REPORT 33

34 Trustees Report Report in terms of Section 70(1) (f) of the Collective Investment Schemes Control Act 2002 (Act No 45 of 2002), for the period 01 April 2016 to 31 March 2017 Prescient Management Company (RF) Proprietary Limited ( The Manager ) in respect of the Prescient Unit Trust Scheme. As trustees of the abovementioned Collective Investment Scheme, we advise that we have controls in place to give us reasonable assurance that the following are being complied with by you, the Manager: i. The limitations imposed on the investment and borrowing powers of the Manager by the Act; and ii. The provision of the Act and the Trust Deed. There were no material instances of compliance contraventions and therefore no consequent losses incurred by the Portfolios in the year. Yours truly Renee Theron Senior Manager Shonese Hassim Manager CIS Trustee ABRIDGED ANNUAL REPORT 34

35 Contact Information Prescient House Westlake Business Park Otto Close, Westlake Cape Town, South Africa PO Box 31142, Tokai 7966 Toll free: Tel: Fax: Website: Prescient Investment Management Ltd, is an authorised financial services provider (FSP 612). Collective Investment Schemes in Securities (CIS) should be considered as medium- to long-term investments. The value may go up as well as down and past performance is not necessarily a guide to future performance. CIS s are traded at the ruling price and can engage in scrip lending and borrowing up to 10% of the market value of the portfolio to bridge insufficient liquidity. A schedule of fees, charges and maximum commissions is available on request from Prescient Management Company Ltd. There is no guarantee in respect of capital or returns in a portfolio. A fund of funds is a portfolio that invests in portfolios of collective investment schemes, which levy their own charges, which could result in a higher fee structure for these portfolios. A Feeder Fund is a portfolio that, apart from assets in liquid form, consists solely of participatory interests in a single portfolio of a collective investment scheme. Forward pricing is used. A Money Market portfolio is not a bank deposit account and the price is targeted at a constant value. The total return is made up of interest received and any gain or loss made on any particular instrument; and in most cases the return will have the effect of increasing or decreasing the daily yield, but in the case of abnormal losses it can have the effect of reducing the capital value of the portfolio. The yield is calculated as a weighted average yield of each underlying instrument in the portfolio. Excessive withdrawals from the portfolio may place the portfolio under liquidity pressures and a process of ring-fencing of withdrawal instructions and managed pay-outs over time may be followed. Prescient Management Company (RF) (Pty) Ltd is registered and approved under the Collective Investment Schemes Control Act (No.45 of 2002). has been calculated using net NAV to NAV numbers, including actual initial and all ongoing fees, with income reinvested on the reinvestment date. The performance for each period shown reflects the return for investors who have been fully invested for that period. Individual investor performance may differ as a result of initial fees, the actual investment date, the date of reinvestments and dividend withholding tax. Full performance calculations are available from the manager on request.