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Abridged Results for the Year Ended 31 December 2017 - STXSWX
SATRIX SWIX TOP 40
JSE code: STXSWX
ISIN: ZAE000078580
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 RESULTS FOR THE YEAR ENDED 31 DECEMBER 2017
STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2017
2017 2016
R R
Income
Dividend income 13 035 334 10 663 102
Interest income 105 209 124 406
REIT income 1 332 555 1 020 440
Total income 14 473 098 11 807 948
Expenses
Management fee (2 136 915) (1 686 745)
Transaction costs (15 192) (279 731)
Trustee and custodian fees (93 742) (92 182)
Total operating expenses (2 245 849) (2 058 658)
Income attributable to investors before
distribution 12 227 249 9 749 290
Income distributions (11 884 707) (9 690 428)
Income attributable to investors after
distributions 342 542 58 862
Realised gains on financial instruments
designated at fair value through profit or
loss 10 944 558 20 321 992
Unrealised gains/(losses)on financial
instruments designated at fair value through
profit or loss 88 507 085 (41 156 838)
Total fair value adjustments 99 451 643 (20 834 846)
Increase / (decrease) in net assets
attributable to investors after
distributions 99 794 185 (20 775 984)
STATEMENT OF FINANCIAL POSITION
at 31 December 2017
2017 2016
R R
ASSETS
Listed equities designated as held at fair
value through profit or loss 580 695 916 493 552 805
Interest receivable 11 937 12 589
Other receivables 217 753 -
Cash and cash equivalents 2 557 128 2 598 774
Total assets 583 482 734 496 164 168
LIABILITIES
Distributions payable to investors 2 057 169 2 272 119
Other payables 194 030 146 167
Total liabilities (excluding net assets
attributable to investors) 2 251 199 2 418 286
Net assets attributable to investors 581 231 535 493 745 882
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO INVESTORS
for the year ended 31 December 2017
Capital Income Net assets
attributable attributable attributable
to investors to investors to investors
R R R
Balance at 1 January 2016 387 477 188 134 215 387 611 403
Creation of Satrix SWIX TOP
40 securities 126 910 463 - 126 910 463
Increase in net assets
attributable to investors
after distributions (20 834 846) 58 862 (20 775 984)
Balance at 31 December 2016 493 552 805 193 077 493 745 882
Creation of Satrix SWIX TOP
40 securities 22 500 372 - 22 500 372
Redemption of Satrix SWIX
Top 40 Securities (34 808 904) - (34 808 904)
Increase in net assets
attributable to investors
after distributions 99 451 643 342 542 99 794 185
Balance at 31 December 2017 580 695 916 535 619 581 231 535
STATEMENT OF CASH FLOWS
for the year ended 31 December 2017
2017 2016
R R
Net cash generated from operating activities 12 058 011 9 760 011
Cash utilised by operations (2 415 739) (2 046 294)
Interest received 105 861 122 763
REIT received 1 332 555 1 020 440
Dividend received 13 035 334 10 663 102
Cash outflow from investing activities 12 308 532 (126 910 463)
Purchase of underlying constituents (66 374 983) (205 035 550)
Sale of underlying constituents 78 683 515 78 125 087
Cash (outflow) / inflow from financing
activities (24 408 189) 117 263 012
Creation of Satrix SWIX TOP 40 Securities 22 500 372 126 910 463
Redemption of Satrix SWIX Top 40 of
Securities (34 808 904) -
Cash distributed to security holders (12 099 657) (9 647 451)
Net (decrease) / increase in cash and cash
equivalents (41 646) 112 560
Cash and cash equivalents at the beginning
of the year 2 598 774 2 486 214
Cash and cash equivalents at the end of the
year 2 557 128 2 598 774
SATRIX SWIX TOP 40 SECURITIES
During the year, 2 000 000 (2016: 12 000 000) Satrix Swix Top 40 securities
were created at a value of R22 500 372 (2016: R126 910 463) and 3 200 000
(2016: nil) Satrix Swix Top 40 securities were redeemed at a value of R 34
808 904(2016: nil). All creations and liquidations were in specie.
Distributions
The Portfolio effects quarterly distributions. All distributions are made
out of income of the Satrix SWIX Top 40 Portfolio. The record dates are 31
March 2017, 30 June 2017, 29 September 2017 and 12 January 2018.
During the year under review the following distributions were effected per
Satrix SWIX Top 40 Security.
2017 2016
R R
6.20 cents per security
Declared 31 March 2017 and
paid 7 April 2017 2 958 524
2.08 cents per security
Declared 1 April 2016 and
paid 14 April 2016 784 537
5.86 cents per security
Declared 30 June 2017 and
paid 6 July 2017 2 796 282
10.42 cents per security
Declared 24 June 2016 and paid
22 July 2016 3 930 229
8.34 cents per security
Declared 29 September 2017 and
paid 4 October 2017 4 063 092
7.47 cents per security
Declared 30 September 2016 and
Paid 12 October 2016 3 041 644
4.24 cents per security
Declared 12 January 2018 and
paid 17 January 2018 2 057 169
4.57 cents per security
Declared 30 December 2016 and
paid 12 January 2017 2 272 118
Accrued income portion of NAV paid
/(received) on redemption / (creation) of
securities 9 640 (338 100)
Total distributions 11 884 707 10 029 251
Operating Segments
The Satrix SWIX TOP 40 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 2017 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 580 695 916 – –
Net assets attributable to
investors – (581 231 535) –
Total 580 695 916 (581 231 535) –
Level 1 Level 2 Level 3
31 December 2016 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 493 552 805 – –
Net assets attributable to
investors – (493 745 882) –
Total 493 552 805 (493 745 882) –
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 2017 R R R
Assets
Interest receivable – 11 937 –
Cash and cash equivalents – 2 557 128 –
Total – 2 569 065 –
31 December 2017 R R R
Liabilities
Distributions payable to
investors – – 2 057 169
Other payables – – 194 030
Total – – 2 251 199
Level 1 Level 2 Level 3
31 December 2016 R R R
Assets
Interest receivable – 12 589 –
Cash and cash equivalents – 2 598 774 –
Total – 2 611 363 –
31 December 2016 R R R
Liabilities
Distributions payable to
investors – – 2 272 119
Other payables – – 146 167
Total – – 2 418 286
Related parties
Related parties include Satrix Managers (RF) (Proprietary) Limited in its
capacity as the management company of the Portfolio.
Sanlam Limited is the ultimate holding company of Satrix Managers (RF)
Proprietary Limited.
The following related party balances and transactions occurred during the
year.
2017 2016
R R
Management fee paid
Satrix Managers (RF) Proprietary Limited 1 942 885 1 674 381
Management fee payable at 31 December
Satrix Managers (RF) Proprietary Limited 194 030 146 167
Participatory Interest Held
Sanlam Limited 46 498 523 52 238 314
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, taxes and underlying fund costs.
The Satrix SWIX Top 40 Portfolio had a TER of 42.28 (2016: 42.33 (restated))
basis points (annualised) for the period 1 January 2017 to 31 December 2017.
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
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 2017 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 2017, and have not been applied in
preparing these financial statements. All standards and interpretations
issued but not effective for the year ended 31 December 2017, and 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
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.
Hedge accounting
The entity does not apply hedge accounting.
New standards and interpretation
The following new standards, interpretations and amendments were adopted to
existing standards. There has been no significant effect on the financial
statements of the Portfolio.
IAS 7 Disclosure Initiative - Annual periods beginning
Amendments to IAS 7 on or after 1 January 2017
Preparer of Abridged annual financial statements for the year ended 31
December 2017
These Abridged annual financial statements have been prepared by I Ismail
(Professional Accountant) (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.
29 March 2018
Sponsor
Vunani Corporate Finance
Trustee
Standard Chartered Bank
Manager
Satrix Managers (RF) Proprietary Limited
Date: 29/03/2018 10:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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