AlAhli Emerging Markets Index Fund
AlAhli Emerging Markets Index Fund
AlAhli Emerging Markets Index Fund – Interim Report A. Fund Manager 1. The Fund Manager is NCB Capital Company. Address: King Saud Road, P.O. Box 22216, Riyadh 11495, Kingdom of Saudi Arabia, Tel: +966 920000232
Fax +966 114060049
Website: www.alahlicapital.com
2. Sub-manager / investment adviser AMUNDI GROUP, 90 Boulevard Pasteur, 75015 Paris, France. 3. Investment activities During the first half of 2017, the fund maintained an overweight to India and Indonesia with an underweight exposure to Russia, Malaysia and Taiwan. 4. Fund’s performance During the first half of 2017, the fund returned 19.29% (net of fees) vs. 22.21% of the benchmark with an underperformance of 292bps. Underperformance was mainly explained by fees, stock picking and cash drag. 5. T&C’s Material changes The Fund Manager has made the following revisions to the fund terms and conditions:
Changing the fund name to “AlAhli Emerging Markets Index Fund”
Changing the fund strategy from active to passive.
Lowering the management fees to 0.30% p.a. from the NAV to be in line with a standard pricing for passively managed funds.
Amending valuation Days will be five days a week from Monday to Friday instead of two days a week to increase the level of transparency of the Funds monetary value. In addition, Dealing Days will be four days a week from Monday to Thursday provided that they are business days in Saudi Arabia and the United States due to the fact that the Funds invest globally.
6. The fund does not invest substantially in other investment funds.
NCB Capital is authorized by the Capital Market Authority of the Kingdom of Saudi Arabia under license number 37-06046. The registered office is at King Saud Road, NCB Regional Building P.O. Box 22216, 11495 Riyadh, Kingdom of Saudi Arabia T: +966 11 874 7106 F: +966 11 406 0049 www.alahlicapital.com
06046-37 شركة األهلي المالية (األهلي كابيتال) هي شركة مرخصــة من قبــل هيئة السـوق الماليــــة ترخيـص رقم ، 22216 ص ب، المبنى اإلقليمي للبنك األهلي التجاري، طريق الملك سعود:وعنوان مركزها الرئيسي المسجل. المملكة العربية السعودية، 11495 الرياض www.alahlicapital.com +966 11 406 0049 : ف+966 11 874 7106 :هـ
7. No special commissions were received by the fund manager during the period.
B. Financial Statements
NCB Capital is authorized by the Capital Market Authority of the Kingdom of Saudi Arabia under license number 37-06046. The registered office is at King Saud Road, NCB Regional Building P.O. Box 22216, 11495 Riyadh, Kingdom of Saudi Arabia T: +966 11 874 7106 F: +966 11 406 0049 www.alahlicapital.com
06046-37 شركة األهلي المالية (األهلي كابيتال) هي شركة مرخصــة من قبــل هيئة السـوق الماليــــة ترخيـص رقم ، 22216 ص ب، المبنى اإلقليمي للبنك األهلي التجاري، طريق الملك سعود:وعنوان مركزها الرئيسي المسجل. المملكة العربية السعودية، 11495 الرياض www.alahlicapital.com +966 11 406 0049 : ف+966 11 874 7106 :هـ
AL-AHLI EMERGING MARKETS INDEX FUND (Formerly Al-Ahli Emerging Markets Trading Equity Fund) (Managed by NCB Capital Company) INTERIM FINANCIAL STATEMENTS (unaudited) For the six months period ended 30 June 2017 with REVIEW REPORT TO THE UNITHOLDERS
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM BALANCE SHEET As at 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated)
Notes
30 June 2017 (Unaudited)
31 December 2016 (Audited)
30 June 2016 (Unaudited)
ASSETS Cash and cash equivalents
7
2,314
851
421
Held for trading investments
9
27,749
24,403
13,804
Accounts receivable
10
196 ────── 30,259
10 ────── 25,264
64 ────── 14,289
11
570 ────── 29,689 ══════ 21,328 ══════ 1.392 ══════
2 ────── 25,262 ══════ 21,649 ══════ 1.1669 ══════
62 ────── 14,227 ══════ 12,201 ══════ 1.1660 ══════
Total assets LIABILITY Accounts payable Net assets attributable to unitholders Units in issue in thousands (number)
12
Net asset value per unit (USD)
The accompanying notes 1 to 15 form integral part of these interim financial statements 2
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM STATEMENT OF INCOME (unaudited) For the six months period ended 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated)
30 June 2017
30 June 2016
Dividend income
209
129
Realised gain / (loss) on sale of held for trading investments
573
(320)
4,341 ────── 5,123 ──────
1,009 ────── 818 ──────
250
128
16
18
Audit fee
3
3
Fund Board remuneration
2
2
Shariah audit fee
3
4
CMA fee
1
1
3 ────── 278 ────── 4,845 ══════
5 ────── 161 ────── 657 ══════
Note INVESTMENT REVENUE
Unrealised gain on measurement of held for trading investments Total revenues 8
EXPENSES Management fee Custody fee
Administrative expenses Total expenses NET INCOME FOR THE PERIOD
The accompanying notes 1 to 15 form integral part of these interim financial statements 3
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM STATEMENT OF CASH FLOWS (unaudited) For the six months period ended 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated)
Note Cash flow from operating activities Net income for the period Adjustment for: Value of units reinvested Unrealised loss / (gain) on held for trading investments Changes in operating assets and liabilities: (Increase) / decrease in held for trading investments (Increase) / decrease in accounts receivable Increase / (decrease) in accounts payable Net cash provided by operating activities Cash flow from financing activities Proceeds from units sold Subscription fees deducted Value of units redeemed Net cash used in financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period
7
Cash and cash equivalents at the end of the period
7
The accompanying notes 1 to 15 form integral part of these interim financial statements 4
30 June 2017
30 June 2016
4,845
657
-4,341 ────── 9,186
161 (1,009) ────── (191)
(7,687) (186) 568 ────── 1,881 ──────
1,045 48 (283) ────── 619 ──────
921 -(1,339) ────── (418) ────── 1,463
518 (7) (1,047) ────── (536) ────── 83
851 ────── 2,314 ══════
338 ────── 421 ══════
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO UNITHOLDERS For the six months period ended 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated) Notes Net assets attributable to Unitholders at the beginning of the period (audited) Net income for the period Decrease in net assets from unit transactions during the period
30 June 2017
30 June 2016
25,262
13,945
4,845
657
921
518
--
(7)
921
511
--
161
(1,339) ─────── (418) ───────
(1,047) ─────── (375) ───────
29,689 ═══════
14,227 ═══════
12
Gross proceeds from units sold Subscription fees deducted Net proceeds from units sold Value of units reinvested
8
Value of units redeemed
Net assets attributable to Unitholders at the end of the period (unaudited)
The accompanying notes 1 to 15 form integral part of these interim financial statements 5
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 1
THE FUND AND ITS ACTIVITIES
Al-Ahli Emerging Markets Trading Equity Fund (the "Fund") is a Shariah compliant, open-end investment fund, managed by NCB Capital Company ("the Fund Manager"), a subsidiary of The National Commercial Bank (“the Bank”), for the benefit of the Fund's Unitholders. The Fund is established under article 30 of the Investment Fund Regulations (the Regulations) issued by the Capital Market Authority (CMA). NCB Capital Company also acts as the custodian of the Fund. As defined in Capital Market Authority's (CMA) Regulation No. 2-83-2005 dated 21 Jumada Awal 1426H (28 June, 2005) the Fund Manager conducts following securities’ activities: a) b) c) d) e)
Dealing; Arranging; Managing; Advising; Custody;
The Fund’s investments are held by CACEIS Bank Luxembourg, a custodian appointed by the Fund Manager. The Fund Manager has appointed an international investment house, Amundi - France, as sub-manager to the Fund. Their duties include opening separate independent investment accounts and managing the Fund’s assets in line with the investment strategies and Shariah guidelines. The Fund invests in equities expected to benefit from growth in Emerging Markets (primarily securities originated in China, India, Russia and Brazil but not limited to these countries). Un-invested cash balances may be held in Shariah compliant money market and Murabaha funds and/or be placed in Murabaha transactions. The terms and conditions of the Fund were originally approved by the Saudi Arabian Monetary Agency (SAMA) and subsequently endorsed by CMA through its letter dated 18 Dhul Hijja 1429H (corresponding to 16 December 2008). The Fund commenced its activities on 9 October 2006. The results for the six months period ended 30 June 2017 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2017. 2
REGULATING AUTHORITY
The Fund is governed by the Regulations issued by the CMA pursuant to resolution number 7-219-2006 dated 3 Dhul Hijja 1427H (corresponding to 24 December 2006) as amended by the Resolution No 1/61/2016 of Board of the CMA dated 16 Sha’ban 1437H (corresponding to 23 May 2016), which provided detailed requirements for all funds within the Kingdom of Saudi Arabia.
6
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 3
CHANGES IN FUND’S TERMS AND CONDITIONS
During the period ended 30 June 2017, the Fund Manager has made certain revisions to the terms and conditions of the Fund. The main change in the terms and conditions relate to change in the Management fees to 0.3%, changing in the strategy, valuation and name of the Fund. The changes were approved by CMA through its letter dated 24 January 2016. These changes were notified by the Fund manager to the Unitholders through a letter dated 24 April 2016 and the changes were implemented from 3 July 2017. 4
SUBSCRIPTION AND REDEMPTION
The Fund is open for subscriptions / redemptions of units on every Saudi Business day. The net asset value of the fund is determined on each Valuation day (Monday and Wednesday). For the purpose of purchase / sale of units, the net assets of the Fund attributable to each unit is determined by dividing the value of net assets of the Fund by the total number of outstanding Fund units on the relevant Valuation day. 5
BASIS OF PREPARATION
Statement of compliance These interim financial statements are prepared in accordance with generally accepted accounting standards in the Kingdom of Saudi Arabia promulgated by Saudi Organization for Certified Public Accountants ("SOCPA"). The Fund prepares its interim financial statements as at and for the period ended on its last valuation date (note 14). The Fund presents comparative numbers of December in Balance Sheet and its related notes as additional information for benefit of Unitholders. Basis of measurement These interim financial statements have been prepared under the historical cost convention using the accrual basis of accounting and the going concern concept, except for held for trading investments which are carried at fair value. Functional and presentational currency These interim financial statements are presented in United States Dollar (USD), which is the Fund’s functional currency. All financial information presented in United States Dollar has been rounded to the nearest thousand.
7
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 5
BASIS OF PREPARATION (continued)
Use of estimates and judgments The preparation of the financial statements in conformity with the generally accepted accounting standards as applicable in the Kingdom of Saudi Arabia requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilit ies, revenues and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognized in the interim financial statements have been consistent with those used in the preparation of annual financial statements of the Fund for the year ended 31 December 2016. Valuation of financial assets Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As the Fund's financial instruments are accounted for under the historical cost convention, except for held for trading investments, differences may arise between the carrying values and fair values. The Fund Manager believes that at the reporting date, the fair values of the Fund's financial assets and liabilities are not materially different from their carrying values. The Fund measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements:
Level 1: Fair value measurements using quoted price (unadjusted) in an active market for identical assets or liabilities. Level 2: Fair value measurements using inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Fair value measurement using inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs).
All financial assets of the fund, carried at fair value at the reporting date, are classified under hierarchy level 1.
8
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 6
SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied consistently to all periods presented in these financial statements. a)
Held for trading investments
Securities listed or traded on a stock exchange are classified as Held for Trading and are initially recognised at cost, being the fair value of the consideration given and are subsequently measured at fair value. Changes in fair values of held for trading investments (“investments”), comprising unrealised gains and losses are included in the statement of income. Realised gains and losses on investments sold are determined on weighted average basis. b)
Investment transaction
Investment transactions are accounted for as of the trade date which is the date on which Fund becomes a part to the contractual provisions of the instrument. c)
Impairment of financial assets
An assessment is made at the balance sheet date to determine whether there is objective evidence that a specific financial asset may be impaired. If such evidence exists, any impairment loss is recognised in the statement of income. If a financial asset is impaired, impairment is determined as follows: (i) (ii) (iii)
d)
For assets carried at fair value, impairment is the difference between cost and fair value, less any impairment loss previously recognised in the statement of income; For assets carried at cost, impairment is the difference between carrying value and the present value of future cash flows discounted at the current market rate of return for a similar financial asset; For assets carried at amortised cost, impairment is the difference between carrying amount and the present value of future cash flows discounted at the original effective commission rate. Derecognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised where: (i) (ii) (iii)
The rights to receive cash flows from the asset have expired; or The Fund has transferred its rights to receive cash flows from the asset; and Either (a) the Fund has transferred substantially all the risks and rewards of the asset, or (b) the Fund has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Fund has transferred its rights to receive cash flows from an asset, and has neither transferred nor retained substantially all of the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the Fund’s continuing involvement in the asset.
9
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 6 e)
SIGNIFICANT ACCOUNTING POLICIES (continued) Revenue recognition
Realised gains and losses on investments sold are determined on an average cost basis. Dividends are recognised when the Fund’s right to receive the payment is established. Increases or decreases in the difference between the cost and market value of the Fund’s portfolio of investments are receognised as change in fair value of investments in the statement of income. f)
Foreign currency translation
Transactions during the year in currencies other than the functional currency are translated into the functional currency at the rates of exchange at the dates of the transactions. Monetary assets and liabilities that are denominated in a foreign currency are retranslated at the rate of exchange ruling at the balance sheet date. Exchange gains or losses are reflected in the statement of income. g)
Taxation / zakat
Taxation / zakat is the obligation of the Unitholders and therefore, no provision for such liability is made in these financial statements. h)
Cash and cash equivalents
For the purposes of the statement of cashflows, cash and cash equivalents consists of bank balances. i)
Net asset value per unit
The Fund is open for subscription and redemption of units on every Saudi business day. The net asset value per unit is calculated by dividing the net assets attributable to Unitholders included in the balance sheet by the number of units outstanding at the period end. j)
Provision and accruals
Provisions and accruals are recognized when the Fund has an obligation (legal or constructive) arising from a past event, and the costs to settle the obligation are both probable and can be measured reliably. k)
Offsetting
Financial assets and liabilities are offset and reported net in the balance sheet when there is a legally enforceable right to set off the recognized amounts and when the Fund intends to settle on a net basis, or to realise the asset and settle the liability simultaneously. Income and expenses are presented on a net basis only when permitted under accounting standards generally accepted in the Kingdom of Saudi Arabia, or for gains and losses arising from a group of similar transactions. 7
CASH AND CASH EQUIVALENTS
Cash and cash equivalents primarily represent cash held in current accounts with banks . 10
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 8
MANAGEMENT FEE AND OTHER EXPENSES
The Fund is managed and administered by the Fund Manager. For these services, the Fund accrues, twice a week, a management fee, as determined by the Fund Manager, but which is no more than the maximum annual rate of 1.85% p.a., as set out in the Fund’s terms and conditions. The Fund Manager is also entitled to recover expenses incurred on behalf of the Fund relating to audit, custody, advisory, data processing and other similar charges. The maximum amount of such expenses that can be recovered from the Fund by the Fund Manager is restricted to 0.50% per annum of the Fund's net assets at the respective valuation days. These expenses have been recovered by the Fund Manager on an actual basis. Furthermore, the Fund Manager is entitled to a subscription fee of 2% at the time of the investment in the Fund by a Unitholder. This fee may be waived at the discretion of the Fund Manager. Until 23 July 2016, the Fund Manager was allocated units against settlement of the management fee and other expenses on every valuation day, which were reinvested in the Fund. Subsequent to this date, these fees/charges are paid in cash. 9
HELD FOR TRADING INVESTMENTS
The composition of the held for trading investments by currency is summarized below:
Currency
Country
New Taiwan Dollar South Korean Won Singapore Dollar United States Dollar Chinese Renminbi Hong Kong Dollar South African Rand Mexican Peso Indonesian Rupiah Malaysian Ringgit Indian Rupee Thailand Baht Philippine Peso
Taiwan Korea Singapore United States of America China Hong Kong South Africa Mexico Indonesia Malaysia India Thailand Philippines
Chilean Peso
Chile
Hungarian Forint Sol Polish Zloty
Hungary Peru Poland
Russian Ruble
Russia
30 June 2017 (Unaudited) % of Total Investments Cost
Fair Value
18.07 18.00 12.46
3,814 4,598 3,336
5,015 4,994 3,458
9.89 8.24 8.09 4.30 4.37 4.05 3.01 2.52 1.72 1.55 1.16 1.06 0.61 0.49 0.41 ──────── 100 ════════
1,665 2,118 2,224 1,520 1,218 1,071 899 695 502 439 301 212 197 107 111 ──────── 25,027 ════════
2,746 2,286 2,245 1,193 1,213 1,124 834 698 478 431 322 294 169 135 114 ──────── 27,749 ════════
11
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 9
HELD FOR TRADING INVESTMENTS (continued) 31 December 2016 Currency
Country
New Taiwan Dollar Singapore Dollar South Korean Won
Taiwan Singapore Korea
Hong Kong Dollar
Hong Kong
United States Dollar South African Rand Indonesian Rupiah Brazilian Real Indian Rupee Mexican Peso
United States of America South Africa Indonesia Brazil India Mexico
Thailand Baht Malaysian Ringgit Philippine Peso Renminbi Chilean Peso Russian Ruble
Thailand Malaysia Philippines China Chile Russia
Hungarian Forint Sol Polish Zloty
Hungary Peru Poland
Currency
Country
United States Dollar
United States of America Hong Kong Taiwan Thailand Indonesia South Africa Brazil Philippines Malaysia Mexico Hungary Turkey Poland
Hong Kong Dollar New Taiwan Dollar Thailand Baht Indonesian Rupiah South African Rand Brazilian Real Philippine Peso Malaysian Ringgit Mexican Peso Hungarian Forint Turkish Lira Polish Zloty
% of Total Investments
Cost
Fair Value
18.10 15.90 14.86 12.51
4,001 4,415 3,991 3,211
4,418 3,881 3,627 3,054
7.96 6.31 4.09 3.36 2.81 2.62 1.98 1.88 1.77 1.59 1.12 1.03 0.97 0.68 0.44 ──────── 100 ════════
1,869 2,054 1,072 908 695 748 577 523 507 404 301 224 212 197 107 ──────── 26,016 ════════
1,942 1,540 999 820 686 640 484 458 431 387 273 252 237 165 108 ──────── 24,403 ════════
30 June 2016 (Unaudited) % of Total Investments Cost 32.16 21.09 19.29 5.13 4.51 4.21 4.17 2.79 2.52 2.47 0.91 0.38 0.37 ──────── 100 ════════
12
4,334 2,460 2,246 752 508 961 704 350 334 289 109 54 57 ──────── 13,158 ════════
Fair Value 4,439 2,911 2,663 708 622 581 576 385 348 341 125 53 52 ──────── 13,804 ════════
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 9
HELD FOR TRADING INVESTMENTS (continued)
The composition of the held for trading investments by industry sector is summarized below:
Industry Sector
Information Technology Consumer Goods Basic Materials Consumer Services Telecommunications Industrials Financials Health Care Oil & Gas Utilities Others
30 June 2017 (Unaudited) % of Total Investments Cost
23.34 17.73 10.91 10.86 9.78 6.45 5.40 5.14 2.46 0.87 7.06
────────
100
════════
% of Total Investments Industry Sector Information Technology Consumer Goods Basic Materials Consumer Services Telecommunication Services Health Care Financials Industrials Oil & Gas Utilities Others
25.80 13.87 10.93 9.78 6.31 5.79 5.37 5.17 3.82 2.36 10.80 ──────── 100 ════════
13
5,107 4,773 3,110 1,998 2,648 1,775 1,338 1,311 745 224 1,998
──────── 25,027 ════════
Fair Value
6,476 4,920 3,027 3,013 2,714 1,791 1,499 1,426 684 240 1,959
────────
27,749
════════
31 December 2016 Cost
Fair Value
6,160 3,820 2,878 2,387 1,850 1,436 1,403 1,380 943 682 3,077 ──────── 26,016 ════════
6,295 3,385 2,668 2,387 1,539 1,413 1,311 1,262 932 576 2,635 ──────── 24,403 ════════
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 9
HELD FOR TRADING INVESTMENTS (continued) 30 June 2016 (Unaudited) % of Total Investments Cost
Industry Sector
Information Technology Consumer Services Telecommunications Consumer Goods Industrials Financials Basic Materials Health Care Oil & Gas Utilities Others
28.21 14.10 12.19 8.66 8.64 8.11 7.91 5.48 1.62 0.58 4.50
2,431 1,974 2,016 1,287 1,109 1,218 1,253 789 303 91 687
3,894 1,947 1,683 1,196 1,192 1,119 1,092 756 223 81 621
────────
────────
────────
════════
════════
════════
100
10
13,158
13,804
ACCOUNTS RECEIVABLE
Receivable for investments sold Dividends receivable Other receivables
11
Fair Value
30 June 2017 (Unaudited)
31 December 2016 (Audited)
30 June 2016 (Unaudited)
113 36 47 ────── 196 ══════
-6 4 ────── 10 ══════
-61 3 ────── 64 ══════
30 June 2017 (Unaudited)
31 December 2016 (Audited)
30 June 2016 (Unaudited)
--570 ────── 570 ══════
--2 ────── 2 ══════
5 21 36 ────── 62 ══════
ACCOUNTS PAYABLE
Payable for investments purchased Payable to Unitholders on account of redemptions Other payables
14
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 12
UNIT TRANSACTIONS
Transactions in units are summarized as follows: For the six months period ended 30 June 2017 Units’ 000
For the six months period ended 30 June 2016 Units’ 000
21,649
12,533
693
467
Units reinvested
--
146
Units redeemed
(1,014)
(945)
(321) ─────── 21,328 ═══════
(332) ─────── 12,201 ═══════
Units at the beginning of the period (audited) Units sold
Net decrease in units during the period Units at the end of the period (unaudited)
As at 30 June 2017, top five Unitholders represented of 58.61% (30 June 2016: 47.42%) of the Fund’s units. 13
RELATED PARTY TRANSACTIONS
In the ordinary course of its activities, the Fund transacts business with related parties on the basis of approved terms and conditions of the Fund. All related party transactions are approved by the Fund Board. Name of entity
Relationship
NCB Capital Company National Commercial Bank (NCB) Al-Ahli Takaful Company Al-Ahli Multi Asset Conservative Fund Al-Ahli Multi Asset Moderate Fund Al-Ahli Multi Asset Growth Fund Al-Ahli Global Equity Fund
Fund Manager Shareholder of Fund Manager Unitholder Unitholder Unitholder Unitholder Unitholder
15
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 13
RELATED PARTY TRANSACTIONS (continued)
The significant related party transactions entered into by the Fund during the period and balances resulting from such transactions are as follows: Related party
Nature of transaction
Value of units held as at 30 June 2017 2016
Amount of transactions 2017 2016
Management Fee
250
128
Expenses paid on behalf of the fund
28
33
Al-Alhli Multi Asset Conservative Fund
Subscription of units
--
--
Redemption of units
--
--
Al-Alhli Multi Asset Moderate Fund
Subscription of units
108
--
Redemption of units
--
--
Al-Ahli Multi Asset Growth Fund
Subscription of units
--
--
Redemption of units
--
--
Al-Ahli Global Equity Fund
Subscription of units
17
--
Redemption of units
--
--
Al Ahli Takaful Subscription of units Company Redemption of units
--
--
NCBC
14
--
--
--
4,435
--
4,524
--
4,024
--
470
--
369
--
LAST VALUATION DAY
The last valuation day for the period was 21 June 2017 (30 June 2016: 29 June 2016). 15
APPROVAL OF THE FINANCIAL STATEMENTS
These interim financial statements were approved by the Fund Manager on Dhul Qadah 23, 1438H, corresponding to August 15, 2017.
16
AlAhli Emerging Markets Index Fund – Interim Report A. Fund Manager 1. The Fund Manager is NCB Capital Company. Address: King Saud Road, P.O. Box 22216, Riyadh 11495, Kingdom of Saudi Arabia, Tel: +966 920000232
Fax +966 114060049
Website: www.alahlicapital.com
2. Sub-manager / investment adviser AMUNDI GROUP, 90 Boulevard Pasteur, 75015 Paris, France. 3. Investment activities During the first half of 2017, the fund maintained an overweight to India and Indonesia with an underweight exposure to Russia, Malaysia and Taiwan. 4. Fund’s performance During the first half of 2017, the fund returned 19.29% (net of fees) vs. 22.21% of the benchmark with an underperformance of 292bps. Underperformance was mainly explained by fees, stock picking and cash drag. 5. T&C’s Material changes The Fund Manager has made the following revisions to the fund terms and conditions:
Changing the fund name to “AlAhli Emerging Markets Index Fund”
Changing the fund strategy from active to passive.
Lowering the management fees to 0.30% p.a. from the NAV to be in line with a standard pricing for passively managed funds.
Amending valuation Days will be five days a week from Monday to Friday instead of two days a week to increase the level of transparency of the Funds monetary value. In addition, Dealing Days will be four days a week from Monday to Thursday provided that they are business days in Saudi Arabia and the United States due to the fact that the Funds invest globally.
6. The fund does not invest substantially in other investment funds.
NCB Capital is authorized by the Capital Market Authority of the Kingdom of Saudi Arabia under license number 37-06046. The registered office is at King Saud Road, NCB Regional Building P.O. Box 22216, 11495 Riyadh, Kingdom of Saudi Arabia T: +966 11 874 7106 F: +966 11 406 0049 www.alahlicapital.com
06046-37 شركة األهلي المالية (األهلي كابيتال) هي شركة مرخصــة من قبــل هيئة السـوق الماليــــة ترخيـص رقم ، 22216 ص ب، المبنى اإلقليمي للبنك األهلي التجاري، طريق الملك سعود:وعنوان مركزها الرئيسي المسجل. المملكة العربية السعودية، 11495 الرياض www.alahlicapital.com +966 11 406 0049 : ف+966 11 874 7106 :هـ
7. No special commissions were received by the fund manager during the period.
B. Financial Statements
NCB Capital is authorized by the Capital Market Authority of the Kingdom of Saudi Arabia under license number 37-06046. The registered office is at King Saud Road, NCB Regional Building P.O. Box 22216, 11495 Riyadh, Kingdom of Saudi Arabia T: +966 11 874 7106 F: +966 11 406 0049 www.alahlicapital.com
06046-37 شركة األهلي المالية (األهلي كابيتال) هي شركة مرخصــة من قبــل هيئة السـوق الماليــــة ترخيـص رقم ، 22216 ص ب، المبنى اإلقليمي للبنك األهلي التجاري، طريق الملك سعود:وعنوان مركزها الرئيسي المسجل. المملكة العربية السعودية، 11495 الرياض www.alahlicapital.com +966 11 406 0049 : ف+966 11 874 7106 :هـ
AL-AHLI EMERGING MARKETS INDEX FUND (Formerly Al-Ahli Emerging Markets Trading Equity Fund) (Managed by NCB Capital Company) INTERIM FINANCIAL STATEMENTS (unaudited) For the six months period ended 30 June 2017 with REVIEW REPORT TO THE UNITHOLDERS
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM BALANCE SHEET As at 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated)
Notes
30 June 2017 (Unaudited)
31 December 2016 (Audited)
30 June 2016 (Unaudited)
ASSETS Cash and cash equivalents
7
2,314
851
421
Held for trading investments
9
27,749
24,403
13,804
Accounts receivable
10
196 ────── 30,259
10 ────── 25,264
64 ────── 14,289
11
570 ────── 29,689 ══════ 21,328 ══════ 1.392 ══════
2 ────── 25,262 ══════ 21,649 ══════ 1.1669 ══════
62 ────── 14,227 ══════ 12,201 ══════ 1.1660 ══════
Total assets LIABILITY Accounts payable Net assets attributable to unitholders Units in issue in thousands (number)
12
Net asset value per unit (USD)
The accompanying notes 1 to 15 form integral part of these interim financial statements 2
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM STATEMENT OF INCOME (unaudited) For the six months period ended 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated)
30 June 2017
30 June 2016
Dividend income
209
129
Realised gain / (loss) on sale of held for trading investments
573
(320)
4,341 ────── 5,123 ──────
1,009 ────── 818 ──────
250
128
16
18
Audit fee
3
3
Fund Board remuneration
2
2
Shariah audit fee
3
4
CMA fee
1
1
3 ────── 278 ────── 4,845 ══════
5 ────── 161 ────── 657 ══════
Note INVESTMENT REVENUE
Unrealised gain on measurement of held for trading investments Total revenues 8
EXPENSES Management fee Custody fee
Administrative expenses Total expenses NET INCOME FOR THE PERIOD
The accompanying notes 1 to 15 form integral part of these interim financial statements 3
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM STATEMENT OF CASH FLOWS (unaudited) For the six months period ended 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated)
Note Cash flow from operating activities Net income for the period Adjustment for: Value of units reinvested Unrealised loss / (gain) on held for trading investments Changes in operating assets and liabilities: (Increase) / decrease in held for trading investments (Increase) / decrease in accounts receivable Increase / (decrease) in accounts payable Net cash provided by operating activities Cash flow from financing activities Proceeds from units sold Subscription fees deducted Value of units redeemed Net cash used in financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period
7
Cash and cash equivalents at the end of the period
7
The accompanying notes 1 to 15 form integral part of these interim financial statements 4
30 June 2017
30 June 2016
4,845
657
-4,341 ────── 9,186
161 (1,009) ────── (191)
(7,687) (186) 568 ────── 1,881 ──────
1,045 48 (283) ────── 619 ──────
921 -(1,339) ────── (418) ────── 1,463
518 (7) (1,047) ────── (536) ────── 83
851 ────── 2,314 ══════
338 ────── 421 ══════
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) INTERIM STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO UNITHOLDERS For the six months period ended 30 June 2017 Expressed in US Dollars ‘000 (unless otherwise stated) Notes Net assets attributable to Unitholders at the beginning of the period (audited) Net income for the period Decrease in net assets from unit transactions during the period
30 June 2017
30 June 2016
25,262
13,945
4,845
657
921
518
--
(7)
921
511
--
161
(1,339) ─────── (418) ───────
(1,047) ─────── (375) ───────
29,689 ═══════
14,227 ═══════
12
Gross proceeds from units sold Subscription fees deducted Net proceeds from units sold Value of units reinvested
8
Value of units redeemed
Net assets attributable to Unitholders at the end of the period (unaudited)
The accompanying notes 1 to 15 form integral part of these interim financial statements 5
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 1
THE FUND AND ITS ACTIVITIES
Al-Ahli Emerging Markets Trading Equity Fund (the "Fund") is a Shariah compliant, open-end investment fund, managed by NCB Capital Company ("the Fund Manager"), a subsidiary of The National Commercial Bank (“the Bank”), for the benefit of the Fund's Unitholders. The Fund is established under article 30 of the Investment Fund Regulations (the Regulations) issued by the Capital Market Authority (CMA). NCB Capital Company also acts as the custodian of the Fund. As defined in Capital Market Authority's (CMA) Regulation No. 2-83-2005 dated 21 Jumada Awal 1426H (28 June, 2005) the Fund Manager conducts following securities’ activities: a) b) c) d) e)
Dealing; Arranging; Managing; Advising; Custody;
The Fund’s investments are held by CACEIS Bank Luxembourg, a custodian appointed by the Fund Manager. The Fund Manager has appointed an international investment house, Amundi - France, as sub-manager to the Fund. Their duties include opening separate independent investment accounts and managing the Fund’s assets in line with the investment strategies and Shariah guidelines. The Fund invests in equities expected to benefit from growth in Emerging Markets (primarily securities originated in China, India, Russia and Brazil but not limited to these countries). Un-invested cash balances may be held in Shariah compliant money market and Murabaha funds and/or be placed in Murabaha transactions. The terms and conditions of the Fund were originally approved by the Saudi Arabian Monetary Agency (SAMA) and subsequently endorsed by CMA through its letter dated 18 Dhul Hijja 1429H (corresponding to 16 December 2008). The Fund commenced its activities on 9 October 2006. The results for the six months period ended 30 June 2017 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2017. 2
REGULATING AUTHORITY
The Fund is governed by the Regulations issued by the CMA pursuant to resolution number 7-219-2006 dated 3 Dhul Hijja 1427H (corresponding to 24 December 2006) as amended by the Resolution No 1/61/2016 of Board of the CMA dated 16 Sha’ban 1437H (corresponding to 23 May 2016), which provided detailed requirements for all funds within the Kingdom of Saudi Arabia.
6
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 3
CHANGES IN FUND’S TERMS AND CONDITIONS
During the period ended 30 June 2017, the Fund Manager has made certain revisions to the terms and conditions of the Fund. The main change in the terms and conditions relate to change in the Management fees to 0.3%, changing in the strategy, valuation and name of the Fund. The changes were approved by CMA through its letter dated 24 January 2016. These changes were notified by the Fund manager to the Unitholders through a letter dated 24 April 2016 and the changes were implemented from 3 July 2017. 4
SUBSCRIPTION AND REDEMPTION
The Fund is open for subscriptions / redemptions of units on every Saudi Business day. The net asset value of the fund is determined on each Valuation day (Monday and Wednesday). For the purpose of purchase / sale of units, the net assets of the Fund attributable to each unit is determined by dividing the value of net assets of the Fund by the total number of outstanding Fund units on the relevant Valuation day. 5
BASIS OF PREPARATION
Statement of compliance These interim financial statements are prepared in accordance with generally accepted accounting standards in the Kingdom of Saudi Arabia promulgated by Saudi Organization for Certified Public Accountants ("SOCPA"). The Fund prepares its interim financial statements as at and for the period ended on its last valuation date (note 14). The Fund presents comparative numbers of December in Balance Sheet and its related notes as additional information for benefit of Unitholders. Basis of measurement These interim financial statements have been prepared under the historical cost convention using the accrual basis of accounting and the going concern concept, except for held for trading investments which are carried at fair value. Functional and presentational currency These interim financial statements are presented in United States Dollar (USD), which is the Fund’s functional currency. All financial information presented in United States Dollar has been rounded to the nearest thousand.
7
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 5
BASIS OF PREPARATION (continued)
Use of estimates and judgments The preparation of the financial statements in conformity with the generally accepted accounting standards as applicable in the Kingdom of Saudi Arabia requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilit ies, revenues and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognized in the interim financial statements have been consistent with those used in the preparation of annual financial statements of the Fund for the year ended 31 December 2016. Valuation of financial assets Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As the Fund's financial instruments are accounted for under the historical cost convention, except for held for trading investments, differences may arise between the carrying values and fair values. The Fund Manager believes that at the reporting date, the fair values of the Fund's financial assets and liabilities are not materially different from their carrying values. The Fund measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements:
Level 1: Fair value measurements using quoted price (unadjusted) in an active market for identical assets or liabilities. Level 2: Fair value measurements using inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Fair value measurement using inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs).
All financial assets of the fund, carried at fair value at the reporting date, are classified under hierarchy level 1.
8
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 6
SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied consistently to all periods presented in these financial statements. a)
Held for trading investments
Securities listed or traded on a stock exchange are classified as Held for Trading and are initially recognised at cost, being the fair value of the consideration given and are subsequently measured at fair value. Changes in fair values of held for trading investments (“investments”), comprising unrealised gains and losses are included in the statement of income. Realised gains and losses on investments sold are determined on weighted average basis. b)
Investment transaction
Investment transactions are accounted for as of the trade date which is the date on which Fund becomes a part to the contractual provisions of the instrument. c)
Impairment of financial assets
An assessment is made at the balance sheet date to determine whether there is objective evidence that a specific financial asset may be impaired. If such evidence exists, any impairment loss is recognised in the statement of income. If a financial asset is impaired, impairment is determined as follows: (i) (ii) (iii)
d)
For assets carried at fair value, impairment is the difference between cost and fair value, less any impairment loss previously recognised in the statement of income; For assets carried at cost, impairment is the difference between carrying value and the present value of future cash flows discounted at the current market rate of return for a similar financial asset; For assets carried at amortised cost, impairment is the difference between carrying amount and the present value of future cash flows discounted at the original effective commission rate. Derecognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised where: (i) (ii) (iii)
The rights to receive cash flows from the asset have expired; or The Fund has transferred its rights to receive cash flows from the asset; and Either (a) the Fund has transferred substantially all the risks and rewards of the asset, or (b) the Fund has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Fund has transferred its rights to receive cash flows from an asset, and has neither transferred nor retained substantially all of the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the Fund’s continuing involvement in the asset.
9
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 6 e)
SIGNIFICANT ACCOUNTING POLICIES (continued) Revenue recognition
Realised gains and losses on investments sold are determined on an average cost basis. Dividends are recognised when the Fund’s right to receive the payment is established. Increases or decreases in the difference between the cost and market value of the Fund’s portfolio of investments are receognised as change in fair value of investments in the statement of income. f)
Foreign currency translation
Transactions during the year in currencies other than the functional currency are translated into the functional currency at the rates of exchange at the dates of the transactions. Monetary assets and liabilities that are denominated in a foreign currency are retranslated at the rate of exchange ruling at the balance sheet date. Exchange gains or losses are reflected in the statement of income. g)
Taxation / zakat
Taxation / zakat is the obligation of the Unitholders and therefore, no provision for such liability is made in these financial statements. h)
Cash and cash equivalents
For the purposes of the statement of cashflows, cash and cash equivalents consists of bank balances. i)
Net asset value per unit
The Fund is open for subscription and redemption of units on every Saudi business day. The net asset value per unit is calculated by dividing the net assets attributable to Unitholders included in the balance sheet by the number of units outstanding at the period end. j)
Provision and accruals
Provisions and accruals are recognized when the Fund has an obligation (legal or constructive) arising from a past event, and the costs to settle the obligation are both probable and can be measured reliably. k)
Offsetting
Financial assets and liabilities are offset and reported net in the balance sheet when there is a legally enforceable right to set off the recognized amounts and when the Fund intends to settle on a net basis, or to realise the asset and settle the liability simultaneously. Income and expenses are presented on a net basis only when permitted under accounting standards generally accepted in the Kingdom of Saudi Arabia, or for gains and losses arising from a group of similar transactions. 7
CASH AND CASH EQUIVALENTS
Cash and cash equivalents primarily represent cash held in current accounts with banks . 10
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 8
MANAGEMENT FEE AND OTHER EXPENSES
The Fund is managed and administered by the Fund Manager. For these services, the Fund accrues, twice a week, a management fee, as determined by the Fund Manager, but which is no more than the maximum annual rate of 1.85% p.a., as set out in the Fund’s terms and conditions. The Fund Manager is also entitled to recover expenses incurred on behalf of the Fund relating to audit, custody, advisory, data processing and other similar charges. The maximum amount of such expenses that can be recovered from the Fund by the Fund Manager is restricted to 0.50% per annum of the Fund's net assets at the respective valuation days. These expenses have been recovered by the Fund Manager on an actual basis. Furthermore, the Fund Manager is entitled to a subscription fee of 2% at the time of the investment in the Fund by a Unitholder. This fee may be waived at the discretion of the Fund Manager. Until 23 July 2016, the Fund Manager was allocated units against settlement of the management fee and other expenses on every valuation day, which were reinvested in the Fund. Subsequent to this date, these fees/charges are paid in cash. 9
HELD FOR TRADING INVESTMENTS
The composition of the held for trading investments by currency is summarized below:
Currency
Country
New Taiwan Dollar South Korean Won Singapore Dollar United States Dollar Chinese Renminbi Hong Kong Dollar South African Rand Mexican Peso Indonesian Rupiah Malaysian Ringgit Indian Rupee Thailand Baht Philippine Peso
Taiwan Korea Singapore United States of America China Hong Kong South Africa Mexico Indonesia Malaysia India Thailand Philippines
Chilean Peso
Chile
Hungarian Forint Sol Polish Zloty
Hungary Peru Poland
Russian Ruble
Russia
30 June 2017 (Unaudited) % of Total Investments Cost
Fair Value
18.07 18.00 12.46
3,814 4,598 3,336
5,015 4,994 3,458
9.89 8.24 8.09 4.30 4.37 4.05 3.01 2.52 1.72 1.55 1.16 1.06 0.61 0.49 0.41 ──────── 100 ════════
1,665 2,118 2,224 1,520 1,218 1,071 899 695 502 439 301 212 197 107 111 ──────── 25,027 ════════
2,746 2,286 2,245 1,193 1,213 1,124 834 698 478 431 322 294 169 135 114 ──────── 27,749 ════════
11
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 9
HELD FOR TRADING INVESTMENTS (continued) 31 December 2016 Currency
Country
New Taiwan Dollar Singapore Dollar South Korean Won
Taiwan Singapore Korea
Hong Kong Dollar
Hong Kong
United States Dollar South African Rand Indonesian Rupiah Brazilian Real Indian Rupee Mexican Peso
United States of America South Africa Indonesia Brazil India Mexico
Thailand Baht Malaysian Ringgit Philippine Peso Renminbi Chilean Peso Russian Ruble
Thailand Malaysia Philippines China Chile Russia
Hungarian Forint Sol Polish Zloty
Hungary Peru Poland
Currency
Country
United States Dollar
United States of America Hong Kong Taiwan Thailand Indonesia South Africa Brazil Philippines Malaysia Mexico Hungary Turkey Poland
Hong Kong Dollar New Taiwan Dollar Thailand Baht Indonesian Rupiah South African Rand Brazilian Real Philippine Peso Malaysian Ringgit Mexican Peso Hungarian Forint Turkish Lira Polish Zloty
% of Total Investments
Cost
Fair Value
18.10 15.90 14.86 12.51
4,001 4,415 3,991 3,211
4,418 3,881 3,627 3,054
7.96 6.31 4.09 3.36 2.81 2.62 1.98 1.88 1.77 1.59 1.12 1.03 0.97 0.68 0.44 ──────── 100 ════════
1,869 2,054 1,072 908 695 748 577 523 507 404 301 224 212 197 107 ──────── 26,016 ════════
1,942 1,540 999 820 686 640 484 458 431 387 273 252 237 165 108 ──────── 24,403 ════════
30 June 2016 (Unaudited) % of Total Investments Cost 32.16 21.09 19.29 5.13 4.51 4.21 4.17 2.79 2.52 2.47 0.91 0.38 0.37 ──────── 100 ════════
12
4,334 2,460 2,246 752 508 961 704 350 334 289 109 54 57 ──────── 13,158 ════════
Fair Value 4,439 2,911 2,663 708 622 581 576 385 348 341 125 53 52 ──────── 13,804 ════════
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 9
HELD FOR TRADING INVESTMENTS (continued)
The composition of the held for trading investments by industry sector is summarized below:
Industry Sector
Information Technology Consumer Goods Basic Materials Consumer Services Telecommunications Industrials Financials Health Care Oil & Gas Utilities Others
30 June 2017 (Unaudited) % of Total Investments Cost
23.34 17.73 10.91 10.86 9.78 6.45 5.40 5.14 2.46 0.87 7.06
────────
100
════════
% of Total Investments Industry Sector Information Technology Consumer Goods Basic Materials Consumer Services Telecommunication Services Health Care Financials Industrials Oil & Gas Utilities Others
25.80 13.87 10.93 9.78 6.31 5.79 5.37 5.17 3.82 2.36 10.80 ──────── 100 ════════
13
5,107 4,773 3,110 1,998 2,648 1,775 1,338 1,311 745 224 1,998
──────── 25,027 ════════
Fair Value
6,476 4,920 3,027 3,013 2,714 1,791 1,499 1,426 684 240 1,959
────────
27,749
════════
31 December 2016 Cost
Fair Value
6,160 3,820 2,878 2,387 1,850 1,436 1,403 1,380 943 682 3,077 ──────── 26,016 ════════
6,295 3,385 2,668 2,387 1,539 1,413 1,311 1,262 932 576 2,635 ──────── 24,403 ════════
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 9
HELD FOR TRADING INVESTMENTS (continued) 30 June 2016 (Unaudited) % of Total Investments Cost
Industry Sector
Information Technology Consumer Services Telecommunications Consumer Goods Industrials Financials Basic Materials Health Care Oil & Gas Utilities Others
28.21 14.10 12.19 8.66 8.64 8.11 7.91 5.48 1.62 0.58 4.50
2,431 1,974 2,016 1,287 1,109 1,218 1,253 789 303 91 687
3,894 1,947 1,683 1,196 1,192 1,119 1,092 756 223 81 621
────────
────────
────────
════════
════════
════════
100
10
13,158
13,804
ACCOUNTS RECEIVABLE
Receivable for investments sold Dividends receivable Other receivables
11
Fair Value
30 June 2017 (Unaudited)
31 December 2016 (Audited)
30 June 2016 (Unaudited)
113 36 47 ────── 196 ══════
-6 4 ────── 10 ══════
-61 3 ────── 64 ══════
30 June 2017 (Unaudited)
31 December 2016 (Audited)
30 June 2016 (Unaudited)
--570 ────── 570 ══════
--2 ────── 2 ══════
5 21 36 ────── 62 ══════
ACCOUNTS PAYABLE
Payable for investments purchased Payable to Unitholders on account of redemptions Other payables
14
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 12
UNIT TRANSACTIONS
Transactions in units are summarized as follows: For the six months period ended 30 June 2017 Units’ 000
For the six months period ended 30 June 2016 Units’ 000
21,649
12,533
693
467
Units reinvested
--
146
Units redeemed
(1,014)
(945)
(321) ─────── 21,328 ═══════
(332) ─────── 12,201 ═══════
Units at the beginning of the period (audited) Units sold
Net decrease in units during the period Units at the end of the period (unaudited)
As at 30 June 2017, top five Unitholders represented of 58.61% (30 June 2016: 47.42%) of the Fund’s units. 13
RELATED PARTY TRANSACTIONS
In the ordinary course of its activities, the Fund transacts business with related parties on the basis of approved terms and conditions of the Fund. All related party transactions are approved by the Fund Board. Name of entity
Relationship
NCB Capital Company National Commercial Bank (NCB) Al-Ahli Takaful Company Al-Ahli Multi Asset Conservative Fund Al-Ahli Multi Asset Moderate Fund Al-Ahli Multi Asset Growth Fund Al-Ahli Global Equity Fund
Fund Manager Shareholder of Fund Manager Unitholder Unitholder Unitholder Unitholder Unitholder
15
AL-AHLI EMERGING MARKETS INDEX FUND (FORMERLY EMERGING MARKETS TRADING EQUITY FUND) (Managed by NCB Capital Company) NOTES TO THE INTERIM FINANCIAL STATEMENTS For the six months period ended 30 June 2016 (unaudited) Expressed in US Dollars ‘000 (unless otherwise stated) 13
RELATED PARTY TRANSACTIONS (continued)
The significant related party transactions entered into by the Fund during the period and balances resulting from such transactions are as follows: Related party
Nature of transaction
Value of units held as at 30 June 2017 2016
Amount of transactions 2017 2016
Management Fee
250
128
Expenses paid on behalf of the fund
28
33
Al-Alhli Multi Asset Conservative Fund
Subscription of units
--
--
Redemption of units
--
--
Al-Alhli Multi Asset Moderate Fund
Subscription of units
108
--
Redemption of units
--
--
Al-Ahli Multi Asset Growth Fund
Subscription of units
--
--
Redemption of units
--
--
Al-Ahli Global Equity Fund
Subscription of units
17
--
Redemption of units
--
--
Al Ahli Takaful Subscription of units Company Redemption of units
--
--
NCBC
14
--
--
--
4,435
--
4,524
--
4,024
--
470
--
369
--
LAST VALUATION DAY
The last valuation day for the period was 21 June 2017 (30 June 2016: 29 June 2016). 15
APPROVAL OF THE FINANCIAL STATEMENTS
These interim financial statements were approved by the Fund Manager on Dhul Qadah 23, 1438H, corresponding to August 15, 2017.
16
