ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2017 The Sygnia Itrix Collective Investment Scheme Sygnia Itrix MSCI USA Exchange Traded Fund (The Fund) JSE code: SYGUS ISIN: ZAE000249546 A portfolio in the Sygnia Itrix Collective Investment Scheme (Sygnia Itrix), registered as such in terms of the Collective Investment Schemes Control Act, 45 of 2002 (CISCA). ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2017 STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2017 RESTATED 2017 2016 R R REVENUE Investment income 97 052 083 103 149 551 Net fair value gain on investments at fair value 848 434 818 412 335 407 through profit or loss 945 487 901 515 484 958 EXPENSES Management and administrative expenses (38 362 220) (36 137 859) Foreign exchange gain/(loss) on dividends 6 900 (22 604) (38 355 320) (36 160 463) OPERATING PROFIT BEFORE DISTRIBUTION 907 131 581 479 324 495 Comprising: Income available for distribution before tax 58 696 763 66 989 088 Capital gain retained 848 434 818 412 335 407 Distributions (42 914 453) (48 295 669) Profit before tax 864 217 128 431 028 826 Withholding tax (14 416 993) (15 783 525) Profit for the year 849 800 135 415 245 301 Other comprehensive income not reclassified to profit or loss Translation of functional currency to ZAR (501 340 192) (603 801 342) Total comprehensive income and increase/(decrease) in net assets attributable to holders of redeemable 348 459 943 (188 556 041) securities 1 STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2017 2017 2016 R R ASSETS Listed investments held at fair value through profit 4 873 247 837 4 441 523 450 or loss Trade and other receivables 4 289 649 4 877 639 Cash and cash equivalents 27 387 260 37 241 792 Total assets 4 904 924 746 4 483 642 881 LIABILITIES Net assets attributable to holders of redeemable 4 881 625 952 4 442 721 575 securities Trade and other payables 23 298 794 40 921 306 Total liabilities 4 904 924 746 4 483 642 881 STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE SECURITIES FOR THE YEAR ENDED 31 DECEMBER 2017 R BALANCE AT 1 JANUARY 2016 4 808 933 486 Profit for the year 415 245 301 Creation of redeemable securities 263 465 187 Redemption of securities (441 121 057) Foreign currency translation adjustments (603 801 342) BALANCE AT 31 DECEMBER 2016 4 442 721 575 Profit for the year 849 800 135 Creation of redeemable securities 90 444 434 Redemption of securities - Foreign currency translation adjustments (501 340 192) BALANCE AT 31 DECEMBER 2017 4 881 625 952 2 STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2017 2017 2016 R R Cash utilised by operations (14 128 089) (16 547 637) Dividends received 97 364 173 103 241 649 Management fees paid (54 107 382) (35 608 268) Interest received 4 813 91 173 Net cash inflow from operating activities 29 133 515 51 176 917 Cash (outflow)/inflow from investing activities (84 622 858) 167 088 767 (Purchase)/sale of listed investments (84 622 858) 167 088 767 Cash inflow/(outflow) from financing activities 45 634 811 (234 855 712) Proceeds on creation of redeemable securities 90 444 434 263 465 187 Redemption of securities - (441 121 057) Distributions paid to investors (44 809 623) (57 199 842) Net decrease in cash and cash equivalents (9 854 532) (16 590 028) Cash and cash equivalents at the beginning of year 37 241 792 53 831 820 Cash and cash equivalents at the end of year 27 387 260 37 241 792 SYGNIA ITRIX MSCI USA REDEEMABLE SECURITIES 2017 2016 Number Number Total redeemable securities in issue 156 000 000 153 000 000 In terms of the Trust Deed and CISCA, the Fund would be required to pay the net asset value attributable to investors on redemption of securities. Vested income beneficiaries include all holders of Sygnia Itrix MSCI USA redeemable securities. CREATIONS AND REDEMPTIONS There were no (2016: 15 000 000) redemptions during the year amounting to a value of nil (2016: R441 121 057). There were 3 000 000 (2016: 9 000 000) creations during the year amounting to a value of R90 444 434 (2016: R263 465 187). 3 DISTRIBUTIONS The Fund effects semi–annual distributions. All distributions are made out of the income of the Fund. The rebates represent an investor’s partial reduction of the 85.5 basis points management fee charged (2016: 85.5 basis points management fee charged). The rebate is calculated using a sliding scale that is dependent on the size of the investor’s investment. During the year under review the following distributions were effected by Sygnia Itrix MSCI USA Redeemable Security: 2017 2016 R R Declared distributions (40 481 579) (44 872 088) 0.13717 rand per security Declared June 2017 and paid July 2017 (21 398 520) 0.14481 rand per security Declared June 2016 and paid July 2016 (23 893 861) 0.12218 rand per security Declared December 2017 and paid January 2018 (19 083 059) 0.13541 rand per security Declared December 2016 and paid January 2017 (20 978 227) Management fees refunded during the year as a rebate (2 432 874) (3 423 581) distribution Total distribution expense for the year (42 914 453) (48 295 669) TOTAL EXPENSE RATIO (TER) The TER represents the total expense to the Fund. The only expense of the Fund is the management fee payable to the Manager, which is calculated at 0.855% of the assets under management on a daily basis (2016: 0.855% of assets under management). The Fund had a TER of 85.5 basis points (2016: 85.5 basis points). The TER disclosed is calculated based on the highest management fee scale applicable. The actual management fee scale is a sliding scale with significant fee reductions applied for larger investment amounts. Increased consumer demand for greater transparency in financial services and the recognition thereof by the collective investment industry requires Collective Investment Scheme (CIS) managers to calculate and publish a total expense ratio for each fund under their management. 4 This is a requirement in terms of the Association for Savings and Investments South Africa (ASISA) standard on the calculation and publication of total expense ratios. STATEMENT OF COMPLIANCE The information in this summarised report has been extracted from the audited annual financial statements, which were prepared in accordance with the JSE Listing Requirements for abridged reports, and the requirements of CISCA, in order to meet the requirements of the Trust Deed approved by the Financial Services Board. The listing requirements require abridged reports to be prepared in accordance with the framework concepts and the measurement and recognition of International Financial Reporting Standards (IFRS) and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee, and the Financial Reporting Pronouncements as issued by Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34 Interim Financial Reporting. This announcement does not include the information required pursuant to paragraph 16A(j) of IAS 34. The full report is available on the issuer’s website, at the issuer’s registered offices and upon request. These financial statements were authorised for issue by the board of directors of the Manager on 27 March 2018. ACCOUNTING POLICIES The accounting policies applied in the preparation of the financial statements from which the summary financial statements were derived are in terms of International Financial Reporting Standards and are consistent with those accounting policies applied in the preparation of the previous annual financial statements except for the correction of the foreign currency to presentation currency translation which has been reflected in other comprehensive income. The correction hereof had no impact on the amounts reflected in the Statement of Financial Position, Statement of Cash flows or the Profit/(loss) Before Tax presented in 2016. NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED The following standards, amendments to standards and interpretations effective for the first time in future accounting periods and which are relevant to the Fund have not been early adopted. IFRS 9 Financial Instruments - IFRS 9 will be effective for the Fund’s annual reporting period starting 1 January 2018. IFRS 9 will replace the current classification, recognition and measurement requirements of IAS 39 Financial Instruments: Recognition and Measurement. Management expects that the impact of the application of IFRS 9 in the financial statements will be minimal for the following reasons: 5 • The Fund’s largest financial instruments are listed equity instruments. These instruments are currently measured at fair value through profit or loss. IFRS 9 requires that all equity instruments be measured at fair value with changes in profit or loss, except for those equity instruments not held for trading and for which the entity has elected to present the changes in fair value in other comprehensive income. The Fund is not making use of this alternative accounting option. • Trade and other receivables are comprised of short-term receivables with established rights and low risk of default. These instruments will continue to be measured at amortised cost in accordance with IFRS 9. It is expected that any associated credit losses on these receivables will be minimal. • The financial liabilities are comprised mostly of redeemable securities, which are designated at fair value through profit or loss. The Fund will continue to designate the liabilities at fair value through profit or loss in accordance with IFRS 9. This is because the liabilities are managed and the performance evaluated on a fair value basis. • Trade and other payables that are financial instruments will continue to be measured at amortised cost. These payables are comprised of short-term payables. • Fair value changes, dividend income and equalisation on investment appropriations will be recognised in accordance with IFRS 9. The recognition and measurement of these items will remain consistent with the current accounting policy. IFRS 15 Revenue from Contracts with Customers - IFRS 15 will be effective for the Fund’s annual reporting period starting 1 January 2018. IFRS 15 replaces the current effective standards on recognition and measurement of revenues, including IAS 18 Revenue. Management expects that there will be no impact on the application of IFRS 15 due to the following: • IFRS 15 excludes those contractual rights and obligations within the scope of IFRS 9. As noted above, all investment returns will be accounted for in accordance with IFRS 9. IFRS 16 Leases - IFRS 16 will be effective for the Fund’s annual reporting period starting 1 January 2019. IFRS 16 provides a single-lessee accounting model, specifying how leases will be recognised, measured and disclosed. Management expects that there will be no impact on the application of IFRS 16 in the current reporting period. IFRS 17 Insurance Contracts - IFRS 17 will be effective for the Fund's annual reporting period starting 1 January 2021. IFRS 17 provides a single accounting model that measures insurance contracts using current estimates. Management expects that there will be no impact on the application of IFRS 17 in the current reporting period. INVESTMENT INCOME Investment income comprises: • Interest income earned on cash and cash equivalents; • Cash equalisation component on creations (at the time of creation it represents the income portion attributable to the net asset value at the time that is payable by the creating party); and 6 • Dividends from listed equities held at fair value through profit or loss. INTEREST INCOME Interest income is recognised in profit or loss using the effective interest method, taking into account the expected timing and amount of cash flows. DIVIDEND INCOME Dividend income is recognised when the right to receive the payment is established. This is usually the ex-dividend date for quoted equities. AUDIT REPORT This summarised report is itself not reviewed or audited, but is extracted from the underlying audited information. The audited annual financial statements for the year ended 31 December 2017 from which the summarised report has been extracted were audited by Deloitte and Touche, who expressed an unmodified opinion thereon. A copy of the auditor’s report on the audited annual financial statements is available for inspection at the company’s registered office together with the annual financial statements identified in the respective auditor’s reports. A full copy of these financial statements is available on the Sygnia website: https://www.sygnia.co.za/etfs/documents. DIRECTORS’ RESPONSIBILITY The directors take full responsibility for the preparation of the abridged report and confirm that the financial information was correctly extracted from the underlying annual financial statements. Sponsor Vunani Corporate Finance Trustee Standard Bank of SA Limited Manager Sygnia Itrix (RF) Proprietary Limited 28 March 2018 7 Date: 28/03/2018 05:45:00 Produced by the JSE SENS Department. 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