Investors Dividend Fund

Transcription

1 Annual Management Report of Fund Performance FOR THE PERIOD ENDED MARCH 31, 216 CAUTION REGARDING FORWARD-LOOKING STATEMENTS This report may contain forward-looking statements about the Fund, including its strategy, expected performance and condition. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as expects, anticipates, intends, plans, believes, estimates or negative versions thereof and similar expressions. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future Fund action, is also a forward-looking statement. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Fund and economic factors. Forward-looking statements are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied in any forward-looking statements made by the Fund. Any number of important factors could contribute to these digressions, including, but not limited to, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, and catastrophic events. We stress that the above mentioned list of important factors is not exhaustive. We encourage you to consider these and other factors carefully before making any investment decisions and we urge you to avoid placing undue reliance on forward-looking statements. Further, you should be aware of the fact that the Fund has no specific intention of updating any forward-looking statements whether as a result of new information, future events or otherwise, prior to the release of the next Management Report of Fund Performance. This annual Management Report of Fund Performance contains financial highlights, but does not contain the complete audited annual financial statements of the investment fund. If the audited annual financial statements of your investment fund did not accompany the mailing of this report, you may receive a copy of them, at your request, and at no cost, by calling ( if you live in Québec) or by writing to us at 447 Portage Avenue, Winnipeg, Manitoba, R3B 3H5 (21, boulevard Robert-Bourassa, bureau 2, Montréal (Québec), H3A 2A6 if you live in Québec), or by visiting our website at or SEDAR at Securityholders may also use one of these methods to request a copy of the investment fund s proxy voting policies and procedures, proxy voting disclosure record, or quarterly portfolio disclosure. Every effort has been made to ensure that the information contained in this Report is accurate as of March 31, 216 (except when stated otherwise), however, the Fund cannot guarantee the accuracy or the completeness of this material. Please refer to the Fund s Prospectus and audited annual financial statements for more information. References to Consultant or Consultants mean Representative or Representatives in Québec. For current net asset values per security for the Fund and for more recent information on general market events, please visit our website at CAUTION REGARDING FUTURE PERFORMANCE Sales commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the Fund s offering documents before investing. The indicated rates of return are the historical annual compounded total returns including changes in security value and reinvestment of all distributions (except for fee rebates) and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any investor that would have reduced returns. Mutual funds are not guaranteed. Their values change frequently and past performance may not be repeated. Copyright Investors Group Inc. 216 Trademarks owned by IGM Financial Inc. and licensed to its subsidiary corporations.

2 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Management Discussion of Fund Performance This management discussion of Fund performance presents views of the portfolio management team about the significant factors and developments during the past year that have affected the Fund s performance and outlook. Please read the caution regarding forward-looking statements located on the first page of this document. Investment Objective and Strategies The Fund has three principal objectives. These are: to obtain above-average income yield on its investments; to protect the value of its investments; and to achieve long-term capital appreciation consistent with the fulfillment of the first two objectives. To achieve the Fund s investment objective, the Fund selects diversified investments such as equities and fixed income securities which provide above-average current income. In order to gauge an above-average income yield, the Fund uses as a yardstick the income yield that could be obtained on a large sample of common shares such as the S&P/TSX Composite Total Return Index. Generally speaking, it is the Fund s intention that its investment in foreign securities will range from % to 3% of its assets, but the Fund may invest up to 5% of its assets in foreign securities from time to time. Risk The overall level of risk of investing in the Fund remains as discussed in the Prospectus, and is not expected to have significantly increased or decreased as a result of operations during the period. Accordingly, the Fund also remains suitable for the same investors as discussed in the Prospectus. Results of Operations CHANGES IN NET ASSETS The Fund s net assets decreased by 8.1% during the period to $16. billion. This change was comprised primarily of a loss from operations of $423.3 million and a decrease of $996.3 million due to net securityholder activity. FEES AND EXPENSES The management expense ratios (MERs) for all series are generally similar to the MERs for the 12-month period ended March 31, 215. Total expenses paid vary period to period mainly as a result of changes in average assets in each series. Average net assets of the Fund for the period were $16.5 billion, a decrease of 4.7% compared to the period ended March 31, 215. INVESTMENT PERFORMANCE In accordance with National Instrument 81-16, the following comparison to broad-based indices has been included to help you understand the Fund s performance relative to the general performance of the markets. However, the portfolio management team cautions that the Fund s mandate may be different from the indices shown. For a description of the indices, see Annual Compound Returns. Also, it is important to note that investors cannot invest in an index. Indirect investments in an index are available; however, there are fees and transaction costs and other variables that will impact returns when investing in these products. Index returns included in the comparison below do not reflect these costs and variables. For the returns of all series and for longer-term performance of the Fund, see the Past Performance section of this report. Performance will vary by series primarily because fees and expenses may differ between series, or because securities of a series were not issued and outstanding for the entire reporting period. See Series Information for the annual expense rates for each series. For the year ended March 31, 216, the Series A securities returned -2.8% (after deducting fees and expenses paid by the Fund). In comparison, the S&P/TSX Composite Index returned -6.6% and the FTSE TMX Canada Universe Bond Index returned.8%. Canada s S&P/TSX Composite Index fell steadily over most of the period. Concerns about economic growth in China and around the world put pressure on commodity prices, which in turn resulted in declines in the key energy and materials sectors. Oil and base metals prices remained volatile throughout the period as global economic worries mounted in advance of an interest rate increase by the U.S. Federal Reserve (the Fed) in December, the first in nearly a decade. After a poor start to 216 on resurfacing global economic worries and falling oil prices, share prices advanced toward the end of the period as oil recovered and economic pessimism eased. Canada s bond market was volatile. Interest rate uncertainty, equity market turbulence, and concerns about U.S. and global economic conditions contributed to fluctuating bond yields and prices. Despite volatility, Canadian bonds produced modestly positive returns. Canadian government bonds generated positive returns after the Fed rate hike and its projections for a very gradual path for further increases. Government bonds benefited from flights to safety during equity market downturns, with some benchmark Canadian government bond yields remaining near record lows. Corporate bonds were mixed as corporate credit spreads widened against the backdrop of heightened risk aversion and economic uncertainty. High-yield bond returns were negative as energy and commodity price weakness weighed on much of the sector. The Fund s equities outperformed the S&P/TSX Composite Index. Lack of exposure to the health care sector, which was by far the worst performing sector in the index, and a large overweight position in the financials sector, which outperformed the overall index, contributed positively to the Fund s relative performance. Lack of exposure to the top-performing consumer staples sector detracted from the Fund s relative performance. The fixed-income portion of the Fund outperformed the FTSE TMX Canada Universe Bond Index. An overweight position in government bonds, which outperformed the broader index, contributed positively to the Fund s relative performance. Recent Developments (BASED ON INFORMATION AS AT APRIL 22, 216) The equity market has been affected by a high degree of uncertainty due to concerns surrounding the strength of the global economy and from heightened volatility in the commodity and currency markets. Canada s economy has been impacted by the substantial correction in crude oil prices, but the impact has been partially offset by the benefits from a lower Canadian dollar. The portfolio management team expects continued modest global economic growth, coupled with low interest rates, to be supportive of equity markets. The Fund remains focused on investing in high quality dividend paying stocks and has significant exposure to the financials sector and positions in the utilities, telecommunication services, consumer discretionary and energy sector, where the portfolio management team sees attractive valuations and dividend yields for select holdings.

3 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Related Party Transactions I.G. Investment Management, Ltd. is the Manager, Trustee and Portfolio Advisor of the Fund. The Fund is offered through the Consultants of Investors Group Financial Services Inc. and Investors Group Securities Inc., together referred to as the Distributors. The Manager, Portfolio Advisor, Distributors and Trustee are, indirectly, wholly owned subsidiaries of IGM Financial Inc. The Fund paid a management fee to the Manager and Portfolio Advisor for management and portfolio advisory services (see Management Fees). The Fund also paid the Manager an administration fee and in exchange the Manager paid the operating costs and expenses of the Fund, except for certain specified costs. The Fund paid the Distributors a service fee as compensation for providing or arranging for the provision of services to the Fund, including the issue or allotment of securities. A portion of the service fee for Series C and Tc is rebated by the Distributors to the Fund quarterly as outlined in the Prospectus. The Trustee is responsible for the overall direction and management of the affairs of the Fund. The Fund paid the Trustee a fee for its services. See Series Information for the annual rates paid by each series (as a percent of average net assets) for these fees. Securityholders in Series Tu and U also pay an advisory fee directly to Investors Group. This fee is not included in the Fund s expenses. Certain other investment funds distributed by Investors Group and other qualified investors may invest in Series P or S of this Fund. All such transactions in the Fund are executed in accordance with standing instructions approved by the Investors Group Funds Independent Review Committee and based on the net asset value per security determined in accordance with the stated policies of the Fund on each transaction day. No commissions or other transaction fees were paid by the Fund in relation to these transactions. As at March 31, 216, these series comprised approximately 15.9% of the Fund s net assets. IGM Financial Inc. maintains a defined benefit employee pension plan and is the pension plan sponsor. The pension plan is a separate trust and its assets are invested in various mutual funds managed by the Manager. As at March 31, 216, the pension plan held securities valued at $7,762, in Series A and $5,242, in Series C of the Fund. IGM Financial Inc. is a subsidiary of Power Financial Corporation and Power Corporation of Canada. Companies related to Power Financial Corporation are therefore considered affiliates of the Manager. As at March 31, 216, the Fund held the following investments in companies affiliated with the Manager: preferred shares of Power Financial Corporation valued at $88. million, common shares of Power Financial Corporation valued at $882.4 million, preferred shares of Power Corporation of Canada valued at $41.9 million, preferred shares of Great-West Lifeco Inc. valued at $99.7 million and common shares of Great-West Lifeco Inc. valued at $538.2 million. These investments are in accordance with standing instructions approved by the Investors Group Funds Independent Review Committee and represent, in aggregate, 1.3% of the Fund s net assets. Management Fees The Fund pays Investors Group a management fee. The management fee paid by each series is calculated as a percentage of the net asset value of the series, as of the close of business on each business day (see Series Information for rates payable by each series). Generally, management fees are used in part to pay costs incurred in providing investment advisory and management services and distribution-related services provided by the Distributors. Securityholders in Series U and Tu pay an advisory fee directly to the Distributors and therefore the management fee in those series is for investment advisory and management services only. For all other retail series (i.e. excluding Series DC, F, P and S if issued), approximately 62% of management fees paid during the period represents investment advisory and management services, and approximately 38% represents distribution-related services. This may vary by series. Approximately 6% of the total fees paid by the Fund for the period relates to services provided by the Manager, Trustee and Portfolio Advisor, and approximately 4% relates to services provided by the Distributors.

4 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Summary of Investment Portfolio AT MARCH 31, 216 The largest positions of the Fund (up to 25) at the end of the period, and the major asset classes in which the Fund was invested, are indicated below. This summary of investment portfolio may change due to ongoing portfolio transactions. The Fund s summary of investment portfolio will be updated as at the end of the next quarter. Please see the front page for information about how it can be obtained. Summary of Top 25 Long Positions % of net assets Royal Bank of Canada 8.1 The Bank of Nova Scotia 7.9 Canadian Imperial Bank of Commerce 6. Bank of Montreal 5.6 TransCanada Corp. 5.5 Power Financial Corp. 5.5 CI Financial Corp. 4.7 Shaw Communications Inc. Class B non-voting 4.3 TELUS Corp. 4.2 The Toronto-Dominion Bank 4.1 Cash and cash equivalents 3.5 Manulife Financial Corp. 3.4 Great-West Lifeco Inc. 3.3 Sun Life Financial Inc. 2.7 Emera Inc. 2.6 Husky Energy Inc. 2.4 BCE Inc. 2.4 Fortis Inc. 1.9 Canada Housing Trust No. 1 2.% Enbridge Inc. 1.7 Canada Housing Trust No % Thomson Reuters Corp. 1.5 Government of Canada 1.% Canada Housing Trust No % Government of Canada 1.% Summary of Top 25 Short Positions* % of net assets Emera Inc. (.1) Bank of Montreal - BCE Inc. - Canadian Imperial Bank of Commerce - Enbridge Inc. - Husky Energy Inc. - The Bank of Nova Scotia - Thomson Reuters Corp. - TransCanada Corp. - (.1) * Short positions are comprised of written call options on the securities listed. Summary of Composition of the Portfolio PORTFOLIO ALLOCATION % of net assets Long positions Equities 87.8 Bonds 9. Cash and cash equivalents Short positions Equities (.1) Other net assets (liabilities) (.2) Total 1. COUNTRY ALLOCATION Canada 95.2 Cash and cash equivalents 3.5 United States 1.5 Other net assets (liabilities) (.2) 1. SECTOR ALLOCATION Financials 54.6 Energy 13. Federal Government Bonds 8.8 Telecommunication Services 6.6 Utilities 6.2 Consumer Discretionary 5.9 Cash and cash equivalents 3.5 Consumer Staples.7 Materials.7 Mortgage Backed Bonds.2 Other net assets (liabilities) (.2) 1. NET CURRENCY EXPOSURE Canadian dollars 98.5 United States dollars Series Information AT MARCH 31, 216 Inception Management Service Administration Trustee Series date 1 fee (%) fee (%) fee (%) fee (%) Series A n/a Series B n/a Series C n/a 1.9 up to Series Jdsc 7/13/ Series Jnl 7/13/ Series P 3 7/2/ Series S 3 7/25/ Series Tdsc 7/13/ Series Tnl 7/13/ Series Tc 7/13/ up to Series Tjdsc 7/13/ Series Tjnl 7/13/ Series Tu 7/12/ Series U 7/12/ Inception dates of the series are shown if within 1 years. 2 Eligible clients are entitled to a rebate of the service fee based on their asset levels held in the Fund and in other Investors Group funds as outlined in the Fund s Prospectus. 3 For details see Related Party Transactions. Securities are only available for purchase by other investment funds or other qualified investors.

5 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Past Performance It is important to remember that past performance doesn t necessarily indicate future performance. The returns presented below: assume that all distributions, except for fee rebates, are reinvested into the Fund; do not include sales charges, income taxes, optional expenses or advisory fees payable directly by securityholders in certain series, that reduce returns; show performance based on Canadian dollar returns; and show performance for each of the past 1 financial years, or since the series started. Financial years are as follows: - 27 to 28 nths ended September 3-29 six months ended March to 216 nths ended March 31 Inception dates of the series within these periods are shown in Series Information. Performance during these periods may have been impacted by the following events: In October 27, the Fund began to pay an administration fee. In exchange, the Manager began to pay certain operating costs and expenses which previously had been paid by the Fund. Effective July 1, 21, the administration fees for Series A and B decreased by.4% to.15% and Series C decreased by.2% to.15%. Effective June 3, 212, the annual management fee rate for Series A and B decreased by.3% to 1.7% and for Series C the rate decreased by.1% to 1.9%. Effective August 31, 212, the annual management fee rate for Series S decreased by.2% to 1.8%. Effective June 3, 212, the annual service fee rate for Series B decreased by.5% to.4%. Year-by-Year Returns These bar charts show how much an investment in securities made on the first day of each financial year would have increased or decreased by the end of the respective period. For the first year of a series, the percentage shown will be the actual return of the series from its inception date. The charts illustrate how the Fund s performance has changed over time. SERIES A % 5.9 (1.8) (19.8) (1.9) (2.8) SERIES B % 5.8 (1.9) (19.8) (2.1) (2.9) SERIES C % 5.8 (1.9) (19.8) (2.1) (3.2) SERIES Jdsc % (2.5) SERIES Jnl % (2.6)

6 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 YEAR-BY-YEAR RETURNS (CONTINUED) SERIES P 4 SERIES Tjdsc % (.5) % (2.5) SERIES S 4 SERIES Tjnl % 6.4 (1.4) (19.6) (1.6) (2.5) % (2.6) SERIES Tdsc 4 SERIES Tu % (2.8) % (1.4) SERIES Tnl 4 SERIES U % (2.8) % (1.5) SERIES Tc % (3.2)

7 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Annual Compound Returns The following table compares the historical annual compound returns for each series with the index (or indices) shown below, for the periods shown ending March 31, 216. For a discussion of the Fund s recent performance relative to the index (or indices), see Results of Operations. Since (%) 1 yr 3 yrs 5 yrs 1 yrs inception Series A (2.8) n/a Series B (2.9) n/a Series C (3.2) n/a Series Jdsc (2.5) 4.9 n/a n/a 7.6 Series Jnl (2.6) 4.8 n/a n/a 7.5 Series P (.5) n/a n/a n/a 7.8 Series S (2.5) n/a 4.1 Series Tdsc (2.8) 4.6 n/a n/a 7.3 Series Tnl (2.8) 4.5 n/a n/a 7.2 Series Tc (3.2) 4.2 n/a n/a 6.9 Series Tjdsc (2.5) 4.9 n/a n/a 7.6 Series Tjnl (2.6) 4.8 n/a n/a 7.5 Series Tu (1.4) n/a n/a n/a 6.1 Series U (1.5) n/a n/a n/a 6.1 FTSE TMX Canada Universe Bond Index S&P/TSX Composite Index (6.6) The annual compound return since inception for the index presented in the table corresponds to Series Jdsc, Jnl, Tdsc, Tnl, Tc, Tjdsc and Tjnl. The comparative annual compound return since inception for the index for each of the remaining series is as follows: Series P: 5.%; Series S: 5.4%; Series Tu and U: 5.1%. 2 The annual compound return since inception for the index presented in the table corresponds to Series Jdsc, Jnl, Tdsc, Tnl, Tc, Tjdsc and Tjnl. The comparative annual compound return since inception for the index for each of the remaining series is as follows: Series P: 7.%; Series S: 4.4%; Series Tu and U: 6.1%. The FTSE TMX Canada Universe Bond Total Return Index is designed to be a broad measure of the Canadian investmentgrade fixed income market weighted by market cap. The S&P/TSX Composite Total Return Index represents the largest companies that trade on the Toronto Stock Exchange and offers a broad measure of performance of the equities market in Canada.

8 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Financial Highlights The following tables show selected key financial information about the Fund and are intended to help you understand the Fund s financial performance for the past five financial years. Footnotes are presented after Ratios and Supplemental Data. Net Assets per Security 1 SERIES A SERIES B beginning of period beginning of period Total revenue Total expenses (.58) (.61) (.56) (.52) (.57) for the period for the period (2.12) (.31) (1.65) operations (.71) (.45) (excluding dividends) From dividends (.69) (.8) (.77) (.8) (.79) From capital gains - - (.2) - - Return of capital distributions (.69) (.8) (.79) (.8) (.79) at period end Total revenue Total expenses (.59) (.62) (.58) (.54) (.59) for the period for the period (2.9) (.3) (1.64) operations (.73) (.48) (excluding dividends) From dividends (.66) (.77) (.75) (.79) (.78) From capital gains - - (.2) - - Return of capital distributions (.66) (.77) (.77) (.79) (.78) at period end SERIES C SERIES Jdsc JDSC beginning of period n/a beginning of period Total revenue Total expenses (.54) (.57) (.53) (.49) (.5) for the period for the period (2.3) (.3) (1.61) operations (.66) (.39) (excluding dividends) From dividends (.66) (.75) (.72) (.78) (.77) From capital gains - - (.2) - - Return of capital distributions (.66) (.75) (.74) (.78) (.77) at period end Total revenue n/a 3 Total expenses (.25) (.26) (.24) (.16) n/a for the period n/a for the period (1.4) (.15) n/a operations (.32) n/a (excluding dividends) n/a From dividends (.38) (.41) (.38) (.3) n/a From capital gains - - (.1) - n/a Return of capital n/a distributions (.38) (.41) (.39) (.3) n/a at period end n/a

9 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Net Assets per Security 1 (CONTINUED) SERIES Jnl JNL beginning of period n/a Total revenue n/a 3 Total expenses (.26) (.27) (.25) (.16) n/a for the period n/a for the period (1.4) (.15) n/a operations (.33) n/a (excluding dividends) n/a From dividends (.37) (.4) (.38) (.3) n/a From capital gains - - (.1) - n/a Return of capital n/a distributions (.37) (.4) (.39) (.3) n/a at period end n/a SERIES P beginning of period n/a n/a Total revenue n/a n/a 3 Total expenses n/a n/a for the period n/a n/a for the period (.97) (.14) 1.7 n/a n/a operations (.6) n/a n/a (excluding dividends) n/a n/a From dividends (.67) (.53) (.33) n/a n/a From capital gains - - (.1) n/a n/a Return of capital n/a n/a distributions (.67) (.53) (.34) n/a n/a at period end n/a n/a SERIES S beginning of period Total revenue Total expenses (.52) (.55) (.51) (.49) (.51) for the period for the period (2.17) (.32) (1.67) operations (.66) (.38) (excluding dividends) From dividends (.79) (.86) (.8) (.82) (.81) From capital gains - - (.2) - - Return of capital distributions (.79) (.86) (.82) (.82) (.81) at period end SERIES Tdsc TDSC beginning of period n/a Total revenue n/a 3 Total expenses (.27) (.29) (.27) (.18) n/a for the period n/a for the period (1.) (.14) 1..9 n/a operations (.34) n/a (excluding dividends) n/a From dividends (.44) (.46) (.41) (.23) n/a From capital gains - - (.1) - n/a Return of capital (.6) (.1) (.1) (.1) n/a distributions (.5) (.56) (.52) (.33) n/a at period end n/a

10 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Net Assets per Security 1 (CONTINUED) SERIES Tnl TNL beginning of period n/a Total revenue n/a 3 Total expenses (.27) (.3) (.29) (.18) n/a for the period n/a for the period (.98) (.14) n/a operations (.32) n/a (excluding dividends) n/a From dividends (.43) (.44) (.4) (.23) n/a From capital gains - - (.1) - n/a Return of capital (.7) (.11) (.1) (.1) n/a distributions (.5) (.55) (.51) (.33) n/a at period end n/a SERIES Tc TC beginning of period n/a Total revenue n/a 3 Total expenses (.26) (.27) (.27) (.18) n/a for the period n/a for the period (.98) (.14) n/a operations (.31) n/a (excluding dividends) n/a From dividends (.44) (.45) (.39) (.23) n/a From capital gains - - (.1) - n/a Return of capital (.6) (.1) (.11) (.1) n/a distributions (.5) (.55) (.51) (.33) n/a at period end n/a SERIES Tjdsc TJDSC beginning of period n/a Total revenue n/a 3 Total expenses (.24) (.25) (.24) (.15) n/a for the period n/a for the period (.99) (.14).98.9 n/a operations (.3) n/a (excluding dividends) n/a From dividends (.48) (.49) (.43) (.23) n/a From capital gains - - (.1) - n/a Return of capital (.5) (.1) (.11) (.11) n/a distributions (.53) (.59) (.55) (.34) n/a at period end n/a SERIES Tjnl TJNL beginning of period n/a Total revenue n/a 3 Total expenses (.24) (.26) (.25) (.16) n/a for the period n/a for the period (.99) (.14).98.9 n/a operations (.3) n/a (excluding dividends) n/a From dividends (.48) (.49) (.42) (.23) n/a From capital gains - - (.1) - n/a Return of capital (.5) (.1) (.12) (.11) n/a distributions (.53) (.59) (.55) (.34) n/a at period end n/a

11 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Net Assets per Security 1 (CONTINUED) SERIES Tu TU beginning of period n/a n/a Total revenue n/a n/a 3 Total expenses (.1) (.11) (.7) n/a n/a for the period n/a n/a for the period (.92) (.13).86 n/a n/a operations (.16) n/a n/a (excluding dividends) n/a n/a From dividends (.6) (.53) (.36) n/a n/a From capital gains - - (.1) n/a n/a Return of capital (.1) (.4) (.5) n/a n/a distributions (.61) (.57) (.42) n/a n/a at period end n/a n/a SERIES U beginning of period n/a n/a Total revenue n/a n/a 3 Total expenses (.11) (.11) (.7) n/a n/a for the period n/a n/a for the period (.95) (.14).87 n/a n/a operations (.17) n/a n/a (excluding dividends) n/a n/a From dividends (.51) (.45) (.29) n/a n/a From capital gains - - (.1) n/a n/a Return of capital n/a n/a distributions (.51) (.45) (.3) n/a n/a at period end n/a n/a Ratios and Supplemental Data SERIES A (pricing NAV) ($ s) 4,51,848 5,744,453 6,448,372 5,885,361 5,828,448 outstanding ( s) 191,394 23,5 259,911 26, 273,435 expense ratio (%) or absorptions (%) ratio (%) rate (%) (pricing NAV) ($) SERIES B (pricing NAV) ($ s) 661, ,51 838, , ,834 outstanding ( s) 28,473 32,423 34,262 3,14 31,326 expense ratio (%) or absorptions (%) ratio (%) rate (%) (pricing NAV) ($) SERIES C (pricing NAV) ($ s) 2,675,762 4,1,12 4,95,12 4,957,844 5,34,814 outstanding ( s) 118, ,516 26, ,27 257,832 expense ratio (%) or absorptions (%) ratio (%) rate (%) (pricing NAV) ($)

12 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Ratios and Supplemental Data (CONTINUED) SERIES JDSC Jdsc (pricing NAV) ($ s) 4,41,455 3,459,47 1,936,569 1,138,915 n/a outstanding ( s) 381, , ,43 12,956 n/a expense ratio (%) n/a or absorptions (%) n/a ratio (%) n/a rate (%) n/a (pricing NAV) ($) n/a SERIES S (pricing NAV) ($ s) 377,72 43, , ,97 251,499 outstanding ( s) 15,664 15,775 14,179 12,771 11,59 expense ratio (%) or absorptions (%) ratio (%) rate (%) (pricing NAV) ($) SERIES JNL Jnl (pricing NAV) ($ s) 426, ,59 236,89 141,54 n/a outstanding ( s) 37,11 28,931 19,465 12,86 n/a expense ratio (%) n/a or absorptions (%) n/a ratio (%) n/a rate (%) n/a (pricing NAV) ($) n/a SERIES Tdsc TDSC (pricing NAV) ($ s) n/a outstanding ( s) n/a expense ratio (%) n/a or absorptions (%) n/a ratio (%) n/a rate (%) n/a (pricing NAV) ($) n/a SERIES P (pricing NAV) ($ s) 2,17,28 2,21,957 1,824,58 n/a n/a outstanding ( s) 22, , ,157 n/a n/a expense ratio (%) n/a n/a or absorptions (%) n/a n/a ratio (%) n/a n/a rate (%) n/a n/a (pricing NAV) ($) n/a n/a SERIES Tnl TNL (pricing NAV) ($ s) n/a outstanding ( s) n/a expense ratio (%) n/a or absorptions (%) n/a ratio (%) n/a rate (%) n/a (pricing NAV) ($) n/a

13 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, 216 Ratios and Supplemental Data (CONTINUED) SERIES Tc TC (pricing NAV) ($ s) 379 1,43 1, n/a outstanding ( s) n/a expense ratio (%) n/a or absorptions (%) n/a ratio (%) n/a rate (%) n/a (pricing NAV) ($) n/a SERIES TU SERIES Tu (pricing NAV) ($ s) 4,142 3, n/a n/a outstanding ( s) n/a n/a expense ratio (%) n/a n/a or absorptions (%) n/a n/a ratio (%) n/a n/a rate (%) n/a n/a (pricing NAV) ($) n/a n/a SERIES Tjdsc TJDSC (pricing NAV) ($ s) 9,173 7,456 6,717 2,74 n/a outstanding ( s) n/a expense ratio (%) n/a or absorptions (%) n/a ratio (%) n/a rate (%) n/a (pricing NAV) ($) n/a SERIES U (pricing NAV) ($ s) 796,14 479, ,12 n/a n/a outstanding ( s) 76,97 43,56 16,91 n/a n/a expense ratio (%) n/a n/a or absorptions (%) n/a n/a ratio (%) n/a n/a rate (%) n/a n/a (pricing NAV) ($) n/a n/a SERIES Tjnl TJNL (pricing NAV) ($ s) 1,479 1,569 1, n/a outstanding ( s) n/a expense ratio (%) n/a or absorptions (%) n/a ratio (%) n/a rate (%) n/a (pricing NAV) ($) n/a

14 ANNUAL MANAGEMENT REPORT OF FUND PERFORMANCE MARCH 31, These calculations are prescribed by securities regulations and are not intended to be a reconciliation between opening and closing net assets per security. This information is derived from the Fund s audited annual financial statements. The financial information is determined in accordance with IFRS, except for information for periods prior to April 1, 213, which is derived from financial statements prepared in accordance with Canadian GAAP. 2 Prior to April 1, 213, the net assets per security presented in the financial statements may be different from the net asset value calculated for Fund pricing purposes. This difference was due to the requirements of Canadian GAAP which may have resulted in a different valuation of investments held by the Fund in accordance with Canadian GAAP than the market value used to determine net asset value of the Fund for the purchase and redemption of the Fund s securities (pricing NAV). The pricing NAV per security at the end of the period is disclosed in Ratios and Supplemental Data. 3 Effective April 1, 213, commissions and other portfolio transaction costs are included in total expenses. Prior to April 1, 213, these costs were reported within realized and unrealized gains (losses) for the period for the purposes of these tables. 4 Net asset value and distributions are based on the actual number of securities outstanding at the relevant time. The increase/decrease from operations is based on the weighted average number of securities outstanding over the financial period. In the period a series is established, the financial information is provided from the date of inception to the end of the period. 5 Distributions were paid in cash, reinvested in additional securities of the Fund, or both. 6 ratio (MER) is based on total expenses, excluding commissions and other portfolio transaction costs, for the stated period and is expressed as an annualized percentage of daily average net assets during the period, except as noted. In the period a series is established, the MER is annualized from the date of inception to the end of the period. Where a Fund directly or indirectly via derivative contract invests in securities of an Underlying Fund, the MERs presented for the Fund include the portion of MERs of the Underlying Fund(s) attributable to this investment. Correspondingly, the MERs presented for the Fund exclude any management or other fees that are waived as a result of its investment in the Underlying Fund(s). Certain expenses that are non-recurring and/or otherwise uncertain as to their future timing and amount have not been annualized. For Series C and Tc, the service fees are divided by the assets attributable to Series C and Tc on the days on which the fee is charged. The MERs presented for Series C and Tc represent the maximum MER applicable to an account because service fee rebates have not been offset against service fees. Eligible clients in Series C and Tc are entitled to a rebate of service fees based on their asset levels held in the Fund and in other Investors Group funds as outlined in the Fund s Prospectus. The rebate is distributed as a return of capital distribution to eligible securityholders and is required to be reinvested in additional Series C and Tc securities. 7 The trading expense ratio (TER) represents total commissions and other portfolio transaction costs incurred as an annualized percentage of daily average net assets during the period. Where a Fund invests in securities of an Underlying Fund, the TERs presented for the Fund include the portion of TERs of the Underlying Fund(s) attributable to this investment. 8 The Fund s portfolio turnover rate indicates how actively the Fund s Portfolio Advisor manages its portfolio investments. A portfolio turnover rate of 1% is equivalent to the Fund buying and selling all of the securities in its portfolio once in the course of the period. Generally, the higher a Fund s portfolio turnover rate in a period, the greater the trading costs payable by the Fund in the period, and the greater the chance of an investor receiving taxable capital gains in the period. There is not necessarily a relationship between a high turnover rate and the performance of a Fund. Transactions incurred to realign the Fund s portfolio after a fund merger, if any, are excluded from the portfolio turnover rate.