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Abridged Results for the Year Ended 31 December 2017 - STXFIN
SATRIX FINI
JSE code: STXFIN
ISIN: ZAE000036356
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 27 554 102 43 715 127
REIT income 7 441 180 6 085 175
Interest income 353 300 611 886
Total income 35 348 582 50 412 188
Expenses
Management fee (2 960 002) (3 926 468)
Transaction costs (353 786) (557 193)
Trustee and custodian fees (74 276) (86 510)
Total operating expenses (3 388 064) (4 570 171)
Income attributable to investors before
distribution 31 960 518 45 842 017
Income distributions (31 604 851) (45 834 204)
Income attributable to investors after
distributions 355 667 7 813
Realised gains on financial instruments
designated at fair value through profit or
loss 23 723 340 121 213 528
Unrealised gains / (losses) on financial
instruments designated at fair value through
profit or loss 141 063 530 (97 882 990)
Total fair value adjustments 164 786 870 23 330 538
Increase in net assets attributable to
investors after distributions 165 142 537 23 338 351
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 1 214 258 028 780 094 544
Interest receivable 42 366 35 151
Cash and cash equivalents 11 440 483 7 371 541
Total assets 1 225 740 877 787 501 236
LIABILITIES
Distributions payable to investors 10 457 600 6 803 414
Other payables 311 022 244 718
Total liabilities (excluding net assets
attributable to investors) 10 768 622 7 048 132
Net assets attributable to investors 1 214 972 255 780 453 104
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO INVESTORS
for the year ended 31 December 2016
Capital Income Net assets
attributable attributable to attributable
to investors investors to investors
R R R
Balance at 31 January 2016 696 820 960 350 747 697 171 707
Creations of Satrix FINI
Securities 558 284 719 - 558 284 719
Redemption of Satrix FINI
Securities (498 341 673) - (498 341 673)
Increase in net assets
attributable to investors
after distributions 23 330 538 7 813 23 338 351
Balance at 31 December 2016 780 094 544 358 560 780 453 104
Creations of Satrix FINI
Securities 438 217 116 - 438 217 116
Redemption of Satrix FINI
Securities (168 840 502) - (168 840 502)
Increase in net assets
attributable to investors
after distributions 164 786 870 355 667 165 142 537
Balance at 31 December 2017 1 214 258 028 714 227 1 214 972 255
STATEMENT OF CASH FLOWS
for the year ended 31 December 2017
2017 2016
R R
Net cash generated from operating activities 32 019 607 45 844 127
Cash utilised by operations (3 321 760) (4 557 776)
Interest received 346 085 601 601
REIT received 7 441 180 6 085 175
Dividend received 27 554 102 43 715 127
Cash (outflow)/inflow from investing
activities (269 376 614) (59 943 046)
Purchase of underlying constituents (521 648 969) (720 344 389)
Sale of underlying constituents 252 272 355 660 401 343
Cash inflow/(outflow) from financing
activities 241 425 949 15 368 933
Creation of Satrix FINI Securities 438 217 116 558 284 719
Redemption of Satrix FINI Securities (168 840 502) (498 341 673)
Cash distributed to security holders (27 950 665) (44 574 113)
Net movement in cash and cash equivalents 4 068 942 1 270 014
Cash and cash equivalents at the beginning
of the year 7 371 541 6 101 527
Cash and cash equivalents at the end of the
year 11 440 483 7 371 541
SATRIX FINI SECURITIES
During the year, 27 200 000 (2016: 40 000 000) Satrix Fini securities were
created at a value of R 438 217 116 (2016: R 558 284 719) and 11 000 000
(2016: 34 000 000) Satrix Fini securities were redeemed at a value of R 168
840 502(2016: R 498 341 673). All creations and liquidations were in specie.
Distributions
The Portfolio effects quarterly distributions. All distributions are made
out of income of the Satrix FINI 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 FINI Security.
2017 2016
R R
3.82 cents per security
Declared 31 March 2017 and
paid 7 April 2017 1 823 553
0.00 cents per security
Declared 1 April 2016 -
29.72 cents per security
Declared 30 June 2017 and
paid 6 July 2017 14 187 433
35.11 cents per security
Declared 24 June 2016 and
paid 22 July 2016 27 293 457
17.64 cents per security
Declared 29 September 2017 and
paid 4 October 2017 8 491 365
14.93 cents per security
Declared 30 September 2016 and
Paid 12 October 2016 10 710 333
15.86 cents per security
Declared 12 January 2018 and
paid 17 January 2018 10 457 600
13.15 cents per security 6 803 414
Declared 30 December 2016 and
paid 12 January 2017
Accrued income portion of NAV paid
/(received) on redemption / (creation) of
securities (3 355 100) 1 027 000
Total distributions 31 604 851 45 834 204
Operating Segments
The Satrix FINI 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 1 214 258 028 – –
Net assets attributable to
investors – (1 214 972 255) –
Total 1 214 258 028 (1 214 972 255) –
Level 1 Level 2 Level 3
31 December 2016 R R R
Financial instruments
designated at fair value
through profit or loss:
Listed equities 780 094 544 – –
Net assets attributable to
investors – (780 453 104) –
Total 780 094 544 (780 453 104) –
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 – 42 366 –
Cash and cash equivalents – 11 440 483 –
Total – 11 482 849 –
31 December 2017 R R R
Liabilities
Distributions payable to
investors – – 10 457 600
Other payables – – 311 022
Total – – 10 768 622
Level 1 Level 2 Level 3
31 December 2016 R R R
Assets
Interest receivable – 35 151 –
Cash and cash equivalents – 7 371 541 –
Total – 7 406 692 –
31 December 2016 R R R
Liabilities
Distributions payable to
investors – – 6 803 414
Other payables – – 244 718
Total – – 7 048 132
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.
2017 2016
R R
Management fee paid
Satrix Managers (RF) Proprietary Limited 2 648 980 3 914 072
Management fee payable at 31 December
Satrix Managers (RF) Proprietary Limited 311 022 244 718
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 FINI Portfolio had a TER of 39.87 (2016: 38.65 (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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