ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2017 - SYGUK The Sygnia Itrix Collective Investment Scheme Sygnia Itrix FTSE 100 Exchange Traded Fund (The Fund) JSE code: SYGUK ISIN: ZAE000249520 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 42 685 440 41 552 293 Net fair value gain on investments at fair value 67 896 481 131 806 146 through profit or loss 110 581 921 173 358 439 EXPENSES Management and administrative expenses (10 054 403) (7 320 710) (10 054 403) (7 320 710) OPERATING PROFIT BEFORE DISTRIBUTION 100 527 518 166 037 729 Comprising: Income available for distribution before tax 32 631 037 34 231 583 Capital gain retained 67 896 481 131 806 146 Distributions (28 476 911) (27 919 490) Profit before tax 72 050 607 138 118 239 Withholding tax (763 236) (1 213 751) Profit for the year 71 287 371 136 904 488 Other comprehensive income not reclassified to profit or loss Translation of functional currency to ZAR (7 553 157) (308 019 581) Total comprehensive income and increase/(decrease) in net assets attributable to holders of redeemable 63 734 214 (171 115 093) securities 1 STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2017 2017 2016 R R ASSETS Listed investments held at fair value through profit 835 171 945 964 078 411 or loss Trade and other receivables 2 354 229 2 132 376 Cash and cash equivalents 18 698 889 17 062 587 Total assets 856 225 063 983 273 374 LIABILITIES Net assets attributable to holders of redeemable 842 009 549 967 377 620 securities Trade and other payables 14 215 514 15 895 754 Total liabilities 856 225 063 983 273 374 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 1 015 578 957 Creation of redeemable securities 122 913 756 Profit for the year 136 904 488 Foreign currency translation adjustments (308 019 581) BALANCE AT 31 DECEMBER 2016 967 377 620 Redemption of securities (189 102 285) Profit for the year 71 287 371 Foreign currency translation adjustments (7 553 157) BALANCE AT 31 DECEMBER 2017 842 009 549 2 STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2017 2017 2016 R R Cash utilised by operations (3 081 884) (1 214 234) Dividends received 42 461 789 41 813 545 Interest received 1 798 34 385 Management fees paid (7 493 957) (7 854 520) Net cash inflow from operating activities 31 887 746 32 779 176 Cash inflow/(outflow) from investing activities 189 190 707 (127 003 887) Sale/(purchase) of listed investments 189 190 707 (127 003 887) Cash (outflow)/inflow from financing activities (219 442 151) 93 407 977 Distributions paid to investors (30 339 867) (29 505 779) Redemption of securities (189 102 284) - Proceeds on creation of redeemable securities - 122 913 756 Net increase/(decrease) in cash and cash equivalents 1 636 302 (816 734) Cash and cash equivalents at the beginning of year 17 062 587 17 879 321 Cash and cash equivalents at the end of year 18 698 889 17 062 587 SYGNIA ITRIX FTSE 100 REDEEMABLE SECURITIES 2017 2016 Number Number Total redeemable securities in issue 6 610 000 8 100 000 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 FTSE 100 redeemable securities. CREATIONS AND REDEMPTIONS There were no (2016: 1 000 000) Index Securities created during the year (2016: R122 913 756). There were 1 490 000 (2016: Nil) redemptions during the year, amounting to R189 102 285 (2016: Nil). DISTRIBUTIONS The Fund effects semi–annual distributions. All distributions are made out of the 3 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 FTSE 100 Index Redeemable Security: 2017 2016 R R Declared distributions (27 635 457) (27 017 121) 2.18481 rand per security Declared June 2017 and paid July 2017 (17 696 929) 2.1431 rand per security Declared June 2016 and paid July 2016 (15 216 208) 1.50166 rand per security Declared December 2017 and paid January 2018 (9 938 528) 1.43944 rand per security Declared December 2016 and paid January 2017 (11 800 913) Management fees refunded during the year as a rebate (841 454) (902 369) distribution Total distribution expense for the year (28 476 911) (27 919 490) 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. This is a requirement in terms of the Association for Savings and Investments South 4 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 the 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 to the following reasons: • 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 5 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 • Dividends from listed equities held at fair value through profit or loss. 6 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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