SAIB Saudi IPO Fund
SAIB Saudi IPO Fund (Managed by Alistithmar for Financial Securities and Brokerage Company) UNAUDITED INTERIM FINANCIAL STATEMENTS 30 JUNE 2017
SAIB Saudi IPO Fund INTERIM BALANCE SHEET As at 30 June 2017 31 December 2016 (Audited) SR
30 June 2016 (Unaudited) SR
9,799,436 27,458,511 191,661 ───────── 37,449,608 ─────────
6,692,746 31,533,187 70,361 ───────── 38,296,294 ─────────
25,937,086 50,508,311 258,810 ───────── 76,704,207 ─────────
Accrued expenses
43,391 ─────────
49,899 ─────────
28,478 ─────────
NET ASSETS
37,406,217 ═════════
38,246,395 ═════════
76,675,729 ═════════
Units in issue
376,090 ═════════
390,228 ═════════
806,529 ═════════
Per unit value
SR 99.46 ═════════
SR 98.01 ═════════
SR 95.07 ═════════
Note
30 June 2017 (Unaudited) SR
ASSETS Bank balances Trading investments Dividend receivable Other receivable
4
LIABILITY
The accompanying notes 1 to 8 form part of these interim financial statements. 2
SAIB Saudi IPO Fund INTERIM STATEMENT OF OPERATIONS Six month period ended 30 June 2017 2017 (Unaudited) SR
2016 (Unaudited) SR
5
890,126 ─────────
(823,555) ─────────
Management fees Other expenses
6
NET INCOME (LOSS) FROM OPERATIONS
8
(396,329) (23,159) ───────── (419,488) ───────── 470,638 ═════════
(819,583) (23,868) ───────── (843,451) ───────── (1,667,006) ═════════
Note INVESTMENT INCOME (LOSS) Trading income (loss), net EXPENSES
The accompanying notes 1 to 8 form part of these interim financial statements. 3
SAIB Saudi IPO Fund INTERIM STATEMENT OF CASH FLOWS Six month period ended 30 June 2017 2017 (Unaudited) SR
2016 (Unaudited) SR
OPERATING ACTIVITIES Net income (loss) from operations Adjustment for: Movement in unrealised (gains) losses on trading investments
Changes in operating assets and liability: Trading investments Dividend receivable Accrued expenses Net cash from in operating activities
470,638
(1,667,006)
(1,989,257) ──────── 1,518,619
2,587,091 ───────── 920,085
6,063,933 (121,300) (6,508) ──────── 4,417,506 ────────
2,153,259 3,170,856 16,743 ───────── 6,260,943 ─────────
(1,310,816) ──────── (1,310,816) ────────
724,500 (753,496) ───────── (28,996) ─────────
3,106,690
6,231,947
6,692,746 ──────── 9,799,436 ═════════
19,705,139 ───────── 25,937,086 ═════════
492,631 ═════════
555,772 ═════════
FINANCING ACTIVITIES Proceeds from units sold Value of units redeemed Net cash used in financing activities
INCREASE IN BANK BALANCES Bank balances at the beginning of the period BANK BALANCES AT THE END OF THE PERIOD
Operational cash flows from dividend Dividend received
The accompanying notes 1 to 8 form part of these interim financial statements. 4
SAIB Saudi IPO Fund INTERIM STATEMENT OF CHANGES IN NET ASSETS Six month period ended 30 June 2017 2017 (Unaudited) SR NET ASSETS VALUE AT THE BEGINNING OF THE PERIOD
2016 (Unaudited) SR
38,246,395 ─────────
78,371,731 ─────────
470,638 ─────────
(1,667,006) ─────────
(1,310,816) ───────── (1,310,816) ─────────
724,500 (753,496) ───────── (28,996) ─────────
37,406,217 ═════════
76,675,729 ═════════
CHANGES FROM OPERATIONS Net income (loss) from operations
CHANGES FROM UNIT TRANSACTIONS Proceeds from units sold Value of units redeemed Net change from unit transactions
NET ASSET VALUE AT THE END OF THE PERIOD
UNIT TRANSACTIONS Transactions in units for the period ended 30 June are summarised as follows: 2017 (Unaudited) Units UNITS AT THE BEGINNING OF THE PERIOD Units sold Units redeemed Net decrease in units
UNITS AT THE END OF THE PERIOD
2016 (Unaudited) Units
390,228 ───────── (14,138) ───────── (14,138) ─────────
806,532 ───────── 8,217 (8,220) ───────── (3) ─────────
376,090 ═════════
806,529 ═════════
The accompanying notes 1 to 8 form part of these interim financial statements. 5
SAIB Saudi IPO Fund NOTES TO THE INTERIM FINANCIAL STATEMENTS 30 June 2017 1
GENERAL
SAIB Saudi IPO Fund (the Fund) is an open ended fund created by an agreement between the Fund Manager and investors (the Unitholders) in the Fund. The Fund commenced operation on 31 August 2015. The objective of the Fund is to achieve capital appreciation with optimum returns, by investing in Initial Public Offering (IPO) and Rights issue of listed Saudi companies. The Fund also invests in recently listed Saudi companies within three years of listing. Alistithmar for Financial Securities and Brokerage Company (Alistithmar Capital), wholly owned subsidiary of the Saudi Investment Bank (The Bank) is the Fund Manager, Broker and Custodian of the Fund. The books and records of the Fund are maintained in Saudi Riyals (SR). 2
REGULATING AUTHORITY
The Fund is governed by the Investment Fund Regulations (the “Regulations”) issued by the CMA on 3 Dhul Hijja 1427H (corresponding to 24 December 2006) and effective from 6 Safar 1438H (corresponding 6 November 2016) by the New Investment Fund Regulations (“Amended Regulations”) published by the Capital Market Authority on 16 Sha’aban 1437H (corresponding to 23 May 2016), detailing requirements for all funds within the Kingdom of Saudi Arabia. 3
SIGNIFICANT ACCOUNTING POLICIES
These interim financial statements have been prepared in accordance with the accounting standard on interim financial reporting issued by the Saudi Organization of Certified Public Accountants (SOCPA). The significant accounting policies used in the preparation of these interim financial statements are consistent with those used and disclosed in the annual financial statements for the year ended 31 December 2016 and are as follows: Accounting convention The interim financial statements are prepared under the historical cost convention modified to include the measurement at fair value of trading investments. Revenue recognition Trading income includes movement in unrealised gains (losses) from changes in fair value, realised gains (losses) from sale of trading investments and dividends from trading investments. Realised gains (losses) on trading investments sold are determined on a weighted average cost basis. Dividend income is recognised when declared (i.e. when the Fund’s right to receive the dividend is established). Investment valuation Equity investments which are purchased for trading purposes are valued at their market price as at the balance sheet date. Investments in mutual funds are valued on the basis of net asset values published by the Fund Manager. Investment transactions Investment transactions are accounted for as of the trade date. Zakat and income tax Zakat and income tax are the obligations of the Unit holders and are not provided for in the accompanying interim financial statements. Foreign currencies Transactions in foreign currencies are translated into Saudi Riyal at the rates of exchange prevailing at the dates of the transaction. Assets and liabilities in foreign currencies at the balance sheet date are retranslated at the rates of exchange ruling at that date. Resulting exchange gains and losses are taken to the interim statement of operations.
6
SAIB Saudi IPO Fund NOTES TO THE INTERIM FINANCIAL STATEMENTS (continued) 30 June 2017 4
TRADING INVESTMENTS
The composition of the trading investments portfolio on the balance sheet date is summarised below: Cost SR
Market value SR
% of market value
30 June 2017 (Unaudited) Equity investments (by sector): Banking Retail Industrial Investment Transport Others
5,157,986 7,878,325 4,575,179 3,262,777 8,384,767 ───────── 29,259,034 ═════════
5,740,660 5,681,003 4,566,486 2,626,917 8,843,445 ───────── 27,458,511 ═════════
20.91 20.69 16.63 9.57 32.20 ───── 100.00 ═════
17,166,573 5,769,255 2,322,036 1,556,177 8,508,926 ───────── 35,322,967 ═════════
12,793,316 5,028,734 2,689,404 914,430 10,107,303 ───────── 31,533,187 ═════════
18,408,769 13,338,377 5,686,560 1,556,177 33,083,415 ───────── 47,977,969
16,785,013 10,903,416 4,810,256 1,217,370 31,428,955 ───────── 43,549,741
33.23 21.59 9.52 2.41 62.23 ───── 86.23
6,891,877 ───────── 54,869,846 ═════════
6,958,570 ───────── 50,508,311 ═════════
13.77 ───── 100.00 ═════
31 December 2016 (Audited) Equity investments (by sector): Retail Banking Transport Cement Others
40.57 15.95 8.53 2.90 32.05 ───── 100.00 ═════
30 June 2016 (Unaudited) Equity investments (by sector): Retail Banking Transport Cement Others
Mutual Funds Investment: SAIB Trade Finance Fund
7
SAIB Saudi IPO Fund NOTES TO THE INTERIM FINANCIAL STATEMENTS (continued) 30 June 2017 5
TRADING INCOME (LOSS), NET Six month period ended 30 June
Movement in unrealised gain (loss) Dividend income Realised (loss) gain
6
2017 (Unaudited) SR
2016 (Unaudited) SR
1,989,257 613,931 (1,713,062) ───────── 890,126 ═════════
(2,587,091) 814,582 948,954 ───────── (823,555) ═════════
TRANSACTIONS WITH RELATED PARTIES
The Fund paid a management fee, administration fee and custody fee at an annual rate of 2.0%, 0.1% and 0.1% respectively of the net asset value at each valuation date. The management fees reflected in the interim statement of operations represent the fees charged by the Fund Manager during the period. Additionally, administration expenses paid by the Fund Manager on behalf of the Fund are reimbursed from the Fund, subject to a maximum administration expense of 0.60% of net asset value per annum. Trade transactions on Tadawul and other countries’ stock exchanges are executed through Alistithmar Capital which is also the custodian of the Fund’s investments. The Bank acts as the Fund’s banker.
7
LAST VALUATION DAY
The last valuation day of the period was 30 June 2017 (2016: 30 June 2016).
8
RESULTS OF OPERATIONS
The results for the interim period may not be indicative of the annual operating results.
8
SAIB Saudi IPO Fund INTERIM BALANCE SHEET As at 30 June 2017 31 December 2016 (Audited) SR
30 June 2016 (Unaudited) SR
9,799,436 27,458,511 191,661 ───────── 37,449,608 ─────────
6,692,746 31,533,187 70,361 ───────── 38,296,294 ─────────
25,937,086 50,508,311 258,810 ───────── 76,704,207 ─────────
Accrued expenses
43,391 ─────────
49,899 ─────────
28,478 ─────────
NET ASSETS
37,406,217 ═════════
38,246,395 ═════════
76,675,729 ═════════
Units in issue
376,090 ═════════
390,228 ═════════
806,529 ═════════
Per unit value
SR 99.46 ═════════
SR 98.01 ═════════
SR 95.07 ═════════
Note
30 June 2017 (Unaudited) SR
ASSETS Bank balances Trading investments Dividend receivable Other receivable
4
LIABILITY
The accompanying notes 1 to 8 form part of these interim financial statements. 2
SAIB Saudi IPO Fund INTERIM STATEMENT OF OPERATIONS Six month period ended 30 June 2017 2017 (Unaudited) SR
2016 (Unaudited) SR
5
890,126 ─────────
(823,555) ─────────
Management fees Other expenses
6
NET INCOME (LOSS) FROM OPERATIONS
8
(396,329) (23,159) ───────── (419,488) ───────── 470,638 ═════════
(819,583) (23,868) ───────── (843,451) ───────── (1,667,006) ═════════
Note INVESTMENT INCOME (LOSS) Trading income (loss), net EXPENSES
The accompanying notes 1 to 8 form part of these interim financial statements. 3
SAIB Saudi IPO Fund INTERIM STATEMENT OF CASH FLOWS Six month period ended 30 June 2017 2017 (Unaudited) SR
2016 (Unaudited) SR
OPERATING ACTIVITIES Net income (loss) from operations Adjustment for: Movement in unrealised (gains) losses on trading investments
Changes in operating assets and liability: Trading investments Dividend receivable Accrued expenses Net cash from in operating activities
470,638
(1,667,006)
(1,989,257) ──────── 1,518,619
2,587,091 ───────── 920,085
6,063,933 (121,300) (6,508) ──────── 4,417,506 ────────
2,153,259 3,170,856 16,743 ───────── 6,260,943 ─────────
(1,310,816) ──────── (1,310,816) ────────
724,500 (753,496) ───────── (28,996) ─────────
3,106,690
6,231,947
6,692,746 ──────── 9,799,436 ═════════
19,705,139 ───────── 25,937,086 ═════════
492,631 ═════════
555,772 ═════════
FINANCING ACTIVITIES Proceeds from units sold Value of units redeemed Net cash used in financing activities
INCREASE IN BANK BALANCES Bank balances at the beginning of the period BANK BALANCES AT THE END OF THE PERIOD
Operational cash flows from dividend Dividend received
The accompanying notes 1 to 8 form part of these interim financial statements. 4
SAIB Saudi IPO Fund INTERIM STATEMENT OF CHANGES IN NET ASSETS Six month period ended 30 June 2017 2017 (Unaudited) SR NET ASSETS VALUE AT THE BEGINNING OF THE PERIOD
2016 (Unaudited) SR
38,246,395 ─────────
78,371,731 ─────────
470,638 ─────────
(1,667,006) ─────────
(1,310,816) ───────── (1,310,816) ─────────
724,500 (753,496) ───────── (28,996) ─────────
37,406,217 ═════════
76,675,729 ═════════
CHANGES FROM OPERATIONS Net income (loss) from operations
CHANGES FROM UNIT TRANSACTIONS Proceeds from units sold Value of units redeemed Net change from unit transactions
NET ASSET VALUE AT THE END OF THE PERIOD
UNIT TRANSACTIONS Transactions in units for the period ended 30 June are summarised as follows: 2017 (Unaudited) Units UNITS AT THE BEGINNING OF THE PERIOD Units sold Units redeemed Net decrease in units
UNITS AT THE END OF THE PERIOD
2016 (Unaudited) Units
390,228 ───────── (14,138) ───────── (14,138) ─────────
806,532 ───────── 8,217 (8,220) ───────── (3) ─────────
376,090 ═════════
806,529 ═════════
The accompanying notes 1 to 8 form part of these interim financial statements. 5
SAIB Saudi IPO Fund NOTES TO THE INTERIM FINANCIAL STATEMENTS 30 June 2017 1
GENERAL
SAIB Saudi IPO Fund (the Fund) is an open ended fund created by an agreement between the Fund Manager and investors (the Unitholders) in the Fund. The Fund commenced operation on 31 August 2015. The objective of the Fund is to achieve capital appreciation with optimum returns, by investing in Initial Public Offering (IPO) and Rights issue of listed Saudi companies. The Fund also invests in recently listed Saudi companies within three years of listing. Alistithmar for Financial Securities and Brokerage Company (Alistithmar Capital), wholly owned subsidiary of the Saudi Investment Bank (The Bank) is the Fund Manager, Broker and Custodian of the Fund. The books and records of the Fund are maintained in Saudi Riyals (SR). 2
REGULATING AUTHORITY
The Fund is governed by the Investment Fund Regulations (the “Regulations”) issued by the CMA on 3 Dhul Hijja 1427H (corresponding to 24 December 2006) and effective from 6 Safar 1438H (corresponding 6 November 2016) by the New Investment Fund Regulations (“Amended Regulations”) published by the Capital Market Authority on 16 Sha’aban 1437H (corresponding to 23 May 2016), detailing requirements for all funds within the Kingdom of Saudi Arabia. 3
SIGNIFICANT ACCOUNTING POLICIES
These interim financial statements have been prepared in accordance with the accounting standard on interim financial reporting issued by the Saudi Organization of Certified Public Accountants (SOCPA). The significant accounting policies used in the preparation of these interim financial statements are consistent with those used and disclosed in the annual financial statements for the year ended 31 December 2016 and are as follows: Accounting convention The interim financial statements are prepared under the historical cost convention modified to include the measurement at fair value of trading investments. Revenue recognition Trading income includes movement in unrealised gains (losses) from changes in fair value, realised gains (losses) from sale of trading investments and dividends from trading investments. Realised gains (losses) on trading investments sold are determined on a weighted average cost basis. Dividend income is recognised when declared (i.e. when the Fund’s right to receive the dividend is established). Investment valuation Equity investments which are purchased for trading purposes are valued at their market price as at the balance sheet date. Investments in mutual funds are valued on the basis of net asset values published by the Fund Manager. Investment transactions Investment transactions are accounted for as of the trade date. Zakat and income tax Zakat and income tax are the obligations of the Unit holders and are not provided for in the accompanying interim financial statements. Foreign currencies Transactions in foreign currencies are translated into Saudi Riyal at the rates of exchange prevailing at the dates of the transaction. Assets and liabilities in foreign currencies at the balance sheet date are retranslated at the rates of exchange ruling at that date. Resulting exchange gains and losses are taken to the interim statement of operations.
6
SAIB Saudi IPO Fund NOTES TO THE INTERIM FINANCIAL STATEMENTS (continued) 30 June 2017 4
TRADING INVESTMENTS
The composition of the trading investments portfolio on the balance sheet date is summarised below: Cost SR
Market value SR
% of market value
30 June 2017 (Unaudited) Equity investments (by sector): Banking Retail Industrial Investment Transport Others
5,157,986 7,878,325 4,575,179 3,262,777 8,384,767 ───────── 29,259,034 ═════════
5,740,660 5,681,003 4,566,486 2,626,917 8,843,445 ───────── 27,458,511 ═════════
20.91 20.69 16.63 9.57 32.20 ───── 100.00 ═════
17,166,573 5,769,255 2,322,036 1,556,177 8,508,926 ───────── 35,322,967 ═════════
12,793,316 5,028,734 2,689,404 914,430 10,107,303 ───────── 31,533,187 ═════════
18,408,769 13,338,377 5,686,560 1,556,177 33,083,415 ───────── 47,977,969
16,785,013 10,903,416 4,810,256 1,217,370 31,428,955 ───────── 43,549,741
33.23 21.59 9.52 2.41 62.23 ───── 86.23
6,891,877 ───────── 54,869,846 ═════════
6,958,570 ───────── 50,508,311 ═════════
13.77 ───── 100.00 ═════
31 December 2016 (Audited) Equity investments (by sector): Retail Banking Transport Cement Others
40.57 15.95 8.53 2.90 32.05 ───── 100.00 ═════
30 June 2016 (Unaudited) Equity investments (by sector): Retail Banking Transport Cement Others
Mutual Funds Investment: SAIB Trade Finance Fund
7
SAIB Saudi IPO Fund NOTES TO THE INTERIM FINANCIAL STATEMENTS (continued) 30 June 2017 5
TRADING INCOME (LOSS), NET Six month period ended 30 June
Movement in unrealised gain (loss) Dividend income Realised (loss) gain
6
2017 (Unaudited) SR
2016 (Unaudited) SR
1,989,257 613,931 (1,713,062) ───────── 890,126 ═════════
(2,587,091) 814,582 948,954 ───────── (823,555) ═════════
TRANSACTIONS WITH RELATED PARTIES
The Fund paid a management fee, administration fee and custody fee at an annual rate of 2.0%, 0.1% and 0.1% respectively of the net asset value at each valuation date. The management fees reflected in the interim statement of operations represent the fees charged by the Fund Manager during the period. Additionally, administration expenses paid by the Fund Manager on behalf of the Fund are reimbursed from the Fund, subject to a maximum administration expense of 0.60% of net asset value per annum. Trade transactions on Tadawul and other countries’ stock exchanges are executed through Alistithmar Capital which is also the custodian of the Fund’s investments. The Bank acts as the Fund’s banker.
7
LAST VALUATION DAY
The last valuation day of the period was 30 June 2017 (2016: 30 June 2016).
8
RESULTS OF OPERATIONS
The results for the interim period may not be indicative of the annual operating results.
8
