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Abridged Audited Results For The Year Ended 31 December 2016 - STXDIV
SATRIX COLLECTIVE INVESTMENT SCHEME
SATRIX DIVI
JSE code: STXDIV
ISIN: ZAE000102018
A portfolio in the Satrix Collective Investment Scheme (“Satrix”),
registered as such in terms of the Collective Investment Schemes Control
Act, 45 of 2002 (the “Act”)
ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2016
STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2016
2016 2015
R R
Income
Dividend income 56 964 426 77 303 752
Fee income: Securities lending - 705 115
Interest income 624 288 677 292
Total income 57 588 714 78 686 159
Expenses
Management fee (5 251 078) (7 311 670)
Transaction costs (1 457 974) (3 003 470)
Trustee and custodian fees (88 552) (111 892)
Total operating expenses (6 797 604) (10 427 032)
Income attributable to investors before
distribution 50 791 110 68 259 127
Income distributions (49 614 539) (69 187 644)
Income attributable to investors after
distributions 1 176 571) (928 517)
Realised gains/(losses) on financial
instruments designated at fair value through
profit or loss 39 717 279 (4 020 714)
Unrealised gains/(losses) on financial
instruments designated at fair value through
profit or loss 197 582 092 (401 969 294)
Total fair value adjustments 237 299 371 (405 990 008)
(Decrease)/increase in net assets
attributable to investors after
distributions 238 475 942 (406 918 525)
STATEMENT OF FINANCIAL POSITION
at 31 December 2016
2016 2015
R R
ASSETS
Listed equities designated as held at fair
value through profit or loss 1 402 926 022 1 331 648 057
Interest receivable 56 441 63 959
Cash and cash equivalents 11 600 000 15 842 242
Total assets 1 414 582 463 1 347 554 258
LIABILITIES
Distributions payable to investors 9 832 969 15 238 674
Other payables 416 495 437 121
Total liabilities (excluding net assets
attributable to investors) 10 249 464 15 675 795
Net assets attributable to investors 1 404 332 999 1 331 878 463
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO INVESTORS
for the year ended 31 December 2016
Capital Income Net assets
attributable attributable attributable
to investors to investors to investors
R R R
Balance at 1 January 2015 1 830 174 327 1 158 923 1 831 333 250
Redemption of Satrix DIVI
Securities (92 536 262) - (92 536 262)
Decrease in net assets
attributable to investors
after distributions (405 990 008) (928 517) (406 918 525)
Balance at 31 December 2015 1 331 648 057 230 406 1 331 878 463
Redemption of Satrix DIVI
Securities (166 021 406) - (166 021 406)
Increase in net assets
attributable to investors
after distributions 237 299 371 1 176 571 238 475 942
Balance at 31 December 2016 1 402 926 022 1 406 977 1 404 332 999
STATEMENT OF CASH FLOWS
for the year ended 31 December 2016
2016 2015
R R
Net cash generated from operating activities 50 778 002 69 452 267
Cash utilised by operations (6 818 230) (9 261 723)
Fee income: Securities lending - 745 518
Interest received 631 806 664 720
Dividend received 56 964 426 77 303 752
Cash inflow from investing activities 166 021 407 92 536 262
Purchase of underlying constituents (730 986 473) (835 395 339)
Sale of underlying constituents 897 007 880 927 931 601
Cash outflow from financing activities (221 041 651) (159 672 103)
Redemption of Satrix DIVI Securities (166 021 407) (92 536 262)
Cash distributed to security holders (55 020 244) (67 135 841)
Net movement in cash and cash equivalents (4 242 242) 2 316 426
Cash and cash equivalents at the beginning
of the year 15 842 242 13 525 816
Cash and cash equivalents at the end of the
year 11 600 000 15 842 242
SATRIX DIVI SECURITIES
During the year, nil (2015: nil) Satrix DIVI securities were created at a
value of R nil (2015: R nil) and 90 000 000 (2015: 40 000 000) Satrix DIVI
securities were redeemed at a value of R166 021 406 (2015: R92 536 262). All
creations and liquidations were in specie.
Distributions
The Portfolio effects quarterly distributions. All distributions were made
out of income of the Satrix DIVI Portfolio. The record dates were 1 April
2016, 24 June 2016, 30 September 2016 and 30 December 2016 respectively.
During the year under review the following distributions were effected per
Satrix DIVI Security.
2016 2015
R R
0.69 cents per security
Declared 1 April 2016 and
paid 14 April 2016 4 846 490
2.22 cents per security
Declared 27 March 2015 and 17 635 454
paid 29 April 2015
3.11 cents per security
Declared 24 June 2016 and
paid 22 July 2016 20 849 123
2.48 cents per security
Declared 26 June 2015 and
paid 23 July 2015 18 708 867
1.99 cents per security
Declared 30 September 2016 and
Paid 12 October 2016 13 221 357
2.27 cents per security
Declared 25 September 2015 and
Paid 22 October 2015 17 124 649
1.48 cents per security
Declared 30 December 2016 and
paid 12 January 2017 9 832 969
2.02 cents per security
Declared 31 December 2015 and
paid 26 January 2016 15 238 674
Accrued income portion of NAV paid
redemption/(creation) of securities 864 600 480 000
Total distributions 49 614 539 69 187 644
Operating Segments
The Satrix DIVI Portfolio offers only one product, being the specific exchange traded fund, tracking the specific identified index.
Information regarding the results of the reportable segment is disclosed in Financials statements as currently set out, thus no further IFRS 8 disclosure is required.
Fair value estimation
The fair value of financial assets and liabilities traded in active markets
(such as publicly traded derivatives and trading securities) are based on
quoted market prices at the close of trading at the year-end date.
The following tables analyse, within the fair value hierarchy, the
Portfolio's financial assets and liabilities (by class) measured at fair
value at 31 December:
Level 1 Level 2 Level 3
31 December 2016 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 1 402 926 022 – –
Net assets attributable to
investors – (1 404 332 999) –
Total 1 402 926 022 (1 404 332 999) –
Level 1 Level 2 Level 3
31 December 2015 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 1 331 648 057 – –
Net assets attributable to
investors – (1 331 878 463) –
Total 1 331 648 057 (1 331 878 463) –
The following table analyses, within the fair value hierarchy, the
Portfolio’s assets and liabilities (by class) not measured at fair value at
31 December but for which fair value is disclosed:
Level 1 Level 2 Level 3
31 December 2016 R R R
Assets
Interest receivable – 56 441 –
Cash and cash equivalents – 11 600 000 –
Total – 11 656 441 –
31 December 2016
Liabilities
Distributions payable to
investors – – 9 832 969
Other payables – – 416 495
Total – – 10 249 464
Level 1 Level 2 Level 3
31 December 2015 R R R
Assets
Interest receivable – 63 959 –
Cash and cash equivalents – 15 842 242 –
Total – 15 906 201 –
Level 1 Level 2 Level 3
31 December 2015 R R R
Liabilities
Distributions payable to
15 238 674
investors – –
Other payables – – 437 121
Total – – 15 675 795
Related parties
Related parties include Satrix Managers (RF) (Proprietary) Limited in its
capacity as the management company of the Portfolio. The following related
party balances and transactions occurred during the year.
2016 2015
R R
Management fee paid
Satrix Managers (RF) Proprietary Limited 5 271 705 7 636 147
Management fee payable at 31 December
Satrix Managers (RF) Proprietary Limited 416 495 437 121
All related party transactions are conducted at arm’s length on normal
commercial terms and conditions. Outstanding balances will be settled in the
ordinary course of business.
Total Expense Ratio ('TER')
The TER is a standard measure used by the Collective Investment Scheme
(‘CIS’) industry to illustrate costs of portfolios on a comparable basis.
The TER includes the management fee, audit fees, bank charges, custodian
fees, costs related to securities lending and taxes.
The Satrix DIVI Portfolio had a TER of 42.94 (2015: 45.12) basis points for
the period 1 January 2014 to 31 December 2016. The ratio is calculated based
on the Association for Savings and Investments South Africa (‘ASISA’)
standard and does not include the cost of acquiring assets.
Increased consumer demand for greater transparency in financial services and
the recognition thereof by the Collective Investment industry requires
managers to calculate and publish a total expense ratio for each Portfolio
under their management. This is a requirement in terms of the ASISA standard
on the calculation and publication of total expense ratios.
Statement of compliance
The financial statements are prepared in accordance with International
Financial Reporting Standards (‘IFRS’) issued by the International
Accounting Standards Board (‘IASB’) and SAICA Financial Reporting Guides as
issued by the Accounting Practices, the Financial Reporting Pronouncements
as issued by the Financial Reporting Standards Council and in accordance
with the requirements of the Collective Investment Schemes Control Act of
South Africa(‘CISCA’), in order to meet the requirements of the Trust Deed
approved by the Financial Services Board.
The abridged financial results have been prepared in accordance with the
framework concepts and the recognition and measurement requirements of
International Financial Reporting Standards (IFRS) and the SAICA Financial
Reporting Guides as issued by the Accounting Practices Board. The
disclosures comply with International Accounting Standards (IAS) 34.
Functional and presentation currency
These financial statements are presented in South African Rand, which is the
Portfolio’s functional currency.
Accounting policies
The financial statements incorporate the principal accounting policies that
are consistent with those adopted in the previous financial year. The new
pronouncements applicable for the financial year ending 31 December 2016 for
the first time, was assessed and did not have a significant impact to the
financial position or performance of the Portfolio.
Forthcoming requirements
New standards, amendments to standards and interpretations not yet adopted
A number of standards, amendments to standards and interpretations are not
effective for the year ended 31 December 2016, and have not been applied in
preparing these financial statements. All standards and interpretations
issued but not effective for the year ended 31 December 2016 have been
considered. None of these are expected to have a significant effect on the
recognition and measurement of the amounts recognised in the financial
statements of the Portfolio.
Standard/Interpretation Effective date
IFRS 15 Revenue from contracts with Annual periods beginning
customers on or after 1 January 2018
IFRS 16 Leases Annual periods beginning
on or after 1 January 2019
IAS 7 amendment Disclosure initiative Annual periods beginning
on or after 1 January 2017
IAS 12 amendment Recognition of Deferred Tax Annual periods beginning
on or after 1 January 2017
Assets for Unrealised
Losses
IFRS 2 amendment Share based payments’, on Annual periods beginning
on or after 1 January 2018
clarifying how to account
for certain types of share-
based payment transactions
IFRS 4 amendment ‘Insurance contracts’ Annual periods beginning
regarding the on or after 1 January 2018
implementation of IFRS 9,
’Financial instruments’
IAS 40 amendment Transfer of investment Annual periods beginning
property on or after 1 January 2018
IAS 10 and IAS 28 Sale or contribution of Deferred until IASB has
amendment Asset between an Investor finalised research project
and its Associate or Joint
Venture
The following standards may have a significant effect on the recognition and
measurement of the amounts recognised in the financial statements of the
Portfolio.
IFRS 9 Financial Instruments Annual periods beginning
on or after 1 January 2018
Impact assessment
The IASB issued the final version of IFRS 9 Financial Instruments that
replaces IAS 39 Financial Instruments: Recognition and Measurement and all
previous versions of IFRS 9. IFRS 9 brings together all three aspects of the
accounting for the financial instruments project: classification and
measurement; impairment; and hedge accounting.
The Portfolio plans to adopt the new standard on the required effective
date. The Portfolio has performed a high-level impact assessment of all
three aspects of IFRS 9. This preliminary assessment is based on currently
available information and may be subject to changes arising from further
detailed analyses or additional reasonable and supportable information being
made available in the future. Overall, no significant impact on its balance
sheet and equity are expected.
Classification and measurement
The Portfolio does not expect a significant impact on its balance sheet or
equity on applying the classification measurement requirements for IFRS 9.
It expects to continue measuring at fair value all financial assets
currently held at fair value.
Trade and other receivables are held to collect contractual cash flows and
are expected to give rise to cash flows representing solely payments of
principal and interest. Thus, the Portfolio expects that these will continue
to be measured at amortised cost under IFRS 9. However, the Portfolio will
analyse the contractual cash flow characteristics of those instruments in
more detail before concluding whether all those instruments meet the
criteria for amortised cost measurement under IFRS 9.
Impairment
IFRS 9 requires the portfolio to record expected credit losses on all of its
debt securities, loans and trade receivables, either on a 12-month or
lifetime basis. The Portfolio expects to apply the simplified approach and
record lifetime expected losses on all trade receivables. The Portfolio does
not expect a significant impact on its equity due to the short term nature
of the receivables but it will need to perform a more detailed analysis
which considers all reasonable and supportable information, including
forward-looking elements to determine the extent of the impact.
Hedge accounting
As IFRS 9 does not change the general principles of how an entity accounts
for effective hedges, the Portfolio does not expect a significant impact as
a result of applying IFRS 9. The Portfolio will assess possible changes
related to the accounting for the time value of options, forward points or
the currency basis spread in more detail in the future.
Preparer of Abridged annual financial statements for the year ended 31 December 2016
These Abridged annual financial statements have been prepared by T du
Plessis CA (SA), the Financial Manager. The financial information has been
correctly extracted from the underlying annual financial statements. The
directors take full responsibility for the preparation of the abridged
annual financial statements.
The abridged annual financial statements are extracted from audited
information, but are not itself audited. The annual financial statements
have been audited by Ernst & Young Inc. The audited annual financial
statements and the audit report are available for inspection at the
registered office of Satrix Managers (RF) (Pty) Limited, 4th Floor, Building
2, 11 Alice Lane, Sandton.
A full copy of these financial statements is available on the Satrix website
www.satrix.co.za.
31 March 2017
Sponsor
Vunani Corporate Finance
Trustee
Standard Chartered Bank
Manager
Satrix Managers (RF) Proprietary Limited
Date: 31/03/2017 08:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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