Invesco Funds Series 1 Interim Report. For the six months ended 31 May 2012 (Unaudited)

Transcription

1 s Series 1 Interim Report For the six months ended 31 May 2012 (Unaudited)

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3 ASEAN Equity 01 Investment Policy and Description of the 03 Investment Adviser s Report on behalf of the Manager 04 Performance Record and Net Asset Value 04 Price and Income Record Portfolio Statement 07 Changes in the Composition of the Portfolio Japanese Equity 01 Investment Policy and Description of the 08 Investment Adviser s Report on behalf of the Manager 09 Performance Record and Net Asset Value 09 Price and Income Record Portfolio Statement 13 Changes in the Composition of the Portfolio Pacific Equity 01 Investment Policy and Description of the 14 Investment Adviser s Report on behalf of the Manager 15 Performance Record and Net Asset Value 15 Price and Income Record Portfolio Statement 19 Changes in the Composition of the Portfolio 20 Balance Sheet 31 May Balance Sheet 30 November Balance Sheet 31 May Income Statement 31 May Income Statement 30 November Income Statement 31 May Statement of Changes in the Net Assets Attributable to Redeemable Participating Unitholders 31 May Statement of Changes in the Net Assets Attributable to Redeemable Participating Unitholders 30 November Statement of Changes in the Net Assets Attributable to Redeemable Participating Unitholders 31 May Notes to the Financial Statements 35 Statement of the Manager s and Trustee s Responsibilities s Series 1

4 Investment Policy and Description of the Investment Objectives and Policies ASEAN Equity (the "") aims to achieve long term capital growth by investing in the ASEAN countries. For investment purposes the Manager has defined the ASEAN countries as the members of the Association of South East Asian Nations which currently comprise Singapore, Malaysia, Thailand, Indonesia, Brunei, the Philippines, Vietnam, Cambodia, Laos and Myanmar. It is the Manager's intention to invest in some or all of the above countries. The investment emphasis will be on geographical asset allocation without any limit as to the proportion of the which may be invested in any one country. As a consequence, the balance of investment between the countries will vary from time to time. The Manager will seek to achieve the investment objective by investing predominantly in listed equity or equity-related securities (including warrants and convertible securities however, no more than 10% of the net asset value of the may be invested in warrants) of companies which operate in or stand to benefit from their operations in and business links with the ASEAN countries. Until such time as Brunei has a stock exchange or recognised market, only 10% of the may be invested in Brunei. Investment in Brunei, Laos and Myanmar will be by way of Global Depository Receipts (GDR's) and American Depository Receipts (ADR's). In the case of Cambodia, investment will not be made directly in local markets at the present time but exposure may be taken through GDR's and ADR's and collective investment schemes investing in Cambodia. Such investment is subject to the limits as set out under "Investment Restrictions". GDR's and ADR's are negotiable certificates in registered form issued by banks where the issuing bank certifies that a specific number of Shares have been deposited with it and acts as custodian of those Shares. GDR's are issued internationally through links between clearing houses in the US and Europe. ADR's are issued and traded on several US stock markets, particularly the New York Stock Exchange and NASDAQ. Japanese Equity (the "") aims to achieve longterm capital growth by investing in the securities of Japanese companies. At least 70% of the s total assets (after deducting ancillary liquid assets) will be invested in equity or equity-related securities of (i) companies having their registered office in Japan, (ii) companies with their registered office outside Japan carrying out their business activities predominantly in Japan, or (iii) holding companies, the interests of which are predominantly invested in companies with their registered office in Japan. Up to 30% of the total assets of the may be invested in aggregate in cash and cash equivalents, money market instruments, equity and equity related instruments issued by companies or other entities not meeting the above requirement or debt securities (including convertible debt) of Japanese issuers. Pacific Equity (the "") aims to achieve long-term capital growth by investing in the securities of companies throughout Asia, but with particular emphasis on those based in the Asian Pacific region. For the purposes of the the Manager has defined the Asian Pacific region as South East Asia (including Singapore, Malaysia, Thailand, Indonesia and the Philippines), East Asia (including Taiwan, South and North Korea, Hong Kong and Japan), China, Australia and New Zealand. At least 70% of the s total assets (after deducting ancillary liquid assets) will be invested in listed equity or equity-related securities of (i) companies having their registered office in the Asia Pacific region, (ii) companies with their registered office outside this region carrying out their business activities predominantly in the Asia Pacific region, or (iii) holding companies, the interests of which are predominantly invested in companies with their registered office in the Asia Pacific region. Up to 30% in aggregate of the total assets of the may be invested in cash and cash equivalents, equity and equity related securities of companies which do not meet the requirements set out above but stand to benefit from their business links with countries in Asia other than the 01 s Series 1 Asia Pacific region or debt securities (including convertible debt) of issuers in the Asian region. The s exposure to the various markets in the region will vary from time to time according to the Manager's opinion as to the prevailing conditions in and prospects for those markets. Description of the Series s Series 1 (the Series ) is a multi-portfolio Irish Unit Trust comprising ASEAN Equity, Japanese Equity and Pacific Equity (together the s ). The Series is authorised by the Central Bank of Ireland in Ireland as a UCITS under the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 as amended and by the Hong Kong Securities and Futures Commission (SFC) under the Hong Kong Securities and Futures Ordinance (Cap. 571) and has been recognised by the Financial Services Authority in the United Kingdom under Section 264 of the Financial Services and Markets Act 2000 (the Act ). Each is a fund in the range of funds managed by Global Asset Management Limited (the Manager ). Global Asset Management Limited is an indirect wholly-owned subsidiary of Ltd. Each is approved by the Central Bank of Ireland. Each is also approved by the SFC. In giving authorisation for the the SFC does not take responsibility for the financial soundness of the nor for the correctness of any statements made or opinions expressed in this regard. The s are not registered under the United States Investment Company Act of 1940 (as amended) and units in the s ( Units ) have not been registered under the United States Securities Act of 1933 (as amended). Accordingly, Units may not be offered, sold or delivered in the United States or to US Persons as defined in the current Prospectus of the Series. The contents of this report, for which the Directors of the Manager are responsible, have been approved by Global Asset Management Limited, which is regulated by the Central Bank of Ireland in Ireland. Unit prices are available on the internet site (for Unitholders in Hong Kong please refer to and, if required by local law or regulation, published in local leading financial newspapers including, in the case of Hong Kong, the Hong Kong Economic Times, the South China Morning Post and the Hong Kong Economic Journal. Unit prices are currently also available from Reuters and Bloomberg. Any investment in the s should be considered long-term. There can be no guarantee that the amounts subscribed for Units will be ultimately realised. Changes in rates of exchange between currencies may cause the value of an investment in the s of the Series to diminish or increase. Investors should be aware that investment in emerging markets is by its nature both high risk and potentially volatile. This report to Unitholders does not constitute an offer or invitation to purchase Units in any of the s. Applications for the purchase of Units may only be made on the basis of the current Prospectus and the financial information contained in the current Dublin s Profile distributed with the Prospectus. A new consolidated prospectus for s Series 1,2,3,4,5,6 and Series was issued on 31 March This contains all relevant information (as at the date of issue) regarding the Series and other s within the Series 1, s Series 2, s Series 3, s Series 4, s Series 5, s Series 6 and Series. This report to Unitholders has been prepared on the basis of the Prospectus. If you wish to receive a copy of the Prospectus please contact any office.

5 Investment Policy and Description of the Investment Objective and Policies (continued) Charges Launch Annual Annual Annual Administration Unit Date Management Distributor Fee Fee % Fee % Actual % ASEAN Equity Annual Trustee Fee Max % A Units AA 01/09/ A (Acc-HKD) Units A 07/07/ B Units AA 20/08/ C Units AA 02/09/ Japanese Equity A Units AA 01/06/ B Units AA 20/08/ C Units AA 13/01/ Pacific Equity A Units AA 01/10/ B Units AA 20/08/ C Units AA 02/09/ I Units A 05/07/2006 N/A Distribution Frequency A = Accumulating AA = Annual The Manager's fee is based on the daily net asset value of each and is paid monthly. The Manager will also pay a fee in respect of its duties as Administrator and Registrar for each. The Administrator fee will be calculated daily and will be paid monthly on the last Business Day of each month at the rates set out above, based on the net asset value of each share class of each on each Business Day. The charges are deductible from the income of each or from capital in the event of an income shortfall. The Trustee will be paid a fee calculated on sliding scale to maximum rate of % per annum of the net asset value of each class of each Unit of the on the last business day of the month and paid monthly. The assets of a are exclusively available to satisfy the rights of Unitholders in relation to that and the rights of creditors whose claims have arisen in connection with the creation, operation or liquidation of that. 02 s Series 1

6 ASEAN Equity Investment Adviser s Report on behalf of the Manager ASEAN equities rallied in December 2011 and for the first two months of 2012, with investors appetite for risk growing stronger on the back of improving macroeconomic data and global monetary stimulus. As a result, those companies more highly geared to the economic cycle, as well as the perceived higher risk emerging equity markets, were amongst the best performers. This, despite the mood of the stock market turning decidedly more cautious as an intensification of events in the eurozone, sent global markets sharply lower in May. Nevertheless, for the period as a whole, the MSCI South East Asia ND index ended in positive territory. On the economic front, ASEAN markets continued to show resilience over the period under review, led by the Philippines and Thailand. The Philippines Gross Domestic Product (GDP) edged higher to 3.7% year-on-year (y-o-y) in 4Q 2011, from 3.6% in 3Q and 3.1% in 2Q respectively. Given the relatively robust state of the economy, the Philippines central bank kept interest rates unchanged at 4.5% for the quarter, citing manageable inflation risks in the target range of 3-5% for More positive regional news came from the Bank of Thailand revising up its 2012 GDP to 4.8% from 4.1% previously. Indonesian investors were cheered by the announcement that credit ratings agency, Fitch, had granted Indonesia a BBB- rating with a stable outlook. This returned the country to investmentgrade status following its downgrade 14 years ago on the heels of the Asian financial crisis The s A Units returned 3.96% versus the MSCI South East Asia ND index return of 5.65% for the six months ended 31 May This placed the in the third quartile of its peer group, the GIF OS ASEAN Equity sector, which rose by an average of 5.89%. At the country level, stock selection in Malaysia and the Philippines contributed to the relative underperformance of the versus its benchmark index during the period. We have reduced our exposure to Malaysia due to the political uncertainty created by an imminent general election. By contrast, stock selection in Indonesia, where we have increased our holdings, and Singapore, both added value. Our investment strategy is to continue to focus on domestic oriented companies which, we believe, will be less affected by the downturn in global growth. On a sector basis, we have increased our exposure relative to the benchmark in the consumer discretionary area so that we are now overweight. On the other hand, we have reduced our holding in the consumer staples sector as we feel these stocks are expensive on valuation grounds compared to historic levels. In addition, we favour companies that are potential beneficiaries of any increase in infrastructure spending. We are overweight in industrials accounting for approximately 20% of the - mainly via offshore marine, engineering & construction companies. ASEAN markets, similar to the regional Asian markets, will continue to be driven by the uncertainty in the global economic environment. That said, we believe domestic demand will be the key medium-term driver for ASEAN equity markets. Relatively strong government and corporate balance sheets, historical underinvestment, governments renewed thrust to drive investments and relatively resilient domestic demand are factors that place the ASEAN region at a competitive advantage, in our view. Dated: 31/05/2012 Global Asset Management Limited For the period under review, stock selection in consumer staples and energy stocks detracted from value. In addition, telecom services and utilities also detracted from value. By contrast, our stock selection in the consumer discretionary and industrials sectors contributed to performance. 03 s Series 1

7 ASEAN Equity Performance Percentage change over: (All expressed in the share class base currency, mid to mid, gross income reinvested) Last 6 months Last Last 5 years 12 months (Cumulative) ASEAN Equity A Units 3.96 (14.10) 1.75 ASEAN Equity A Acc HKD Units 3.71 N/A N/A ASEAN Equity B Units 3.49 (14.87) (2.89) ASEAN Equity C Units 4.28 (13.57) 4.73 MSCI Indonesia Value* (1.35) (12.20) MSCI Malaysia Free * 7.37 (2.41) MSCI Philippines Free* MSCI Singapore * 5.27 (13.86) 5.59 MSCI Thailand * MSCI South East Asia (benchmark) 5.65 (7.25) Morningstar GIF OS ASEAN Equity* 5.89 (7.14) Source: Morningstar * For comparative purposes The Net Asset Value Information for 31 May 2012, 30 November 2011 and 31 May 2011 can be found on pages 26, 27 and 28. Price and Income Record The table below shows the highest and lowest NAV prices of Units in the s and the annual income distribution of the in the last 10 years. Calendar Year Highest NAV Price A Units Lowest NAV Price A Units Highest NAV Price A- Acc HKD Units Lowest NAV Price A- Highest Lowest Highest Lowest Acc NAV Price B NAV Price B NAV Price C NAV Price C HKD Units Units Units Units Units $$ $ $ $ $ $ $ $ n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Net Income per $2,000 Calendar Year Net Income Distribution invested in October 1992 A Units B Units C Units A Units B Units C Units $ $ $ $ $ $ Figures to 30 June The was redomiciled to Ireland on 28 October 1992 at a price of $47.03 per Unit, excluding all managers initial charges. Source: Global Asset Management Limited. Distributions, if any, are paid annually to A, B and C Unitholders on or before 21 January and are set out in note 8. Reports on the progress of the are published on or before 31 March and on or before 31 July each year and shall be made available to Unitholders free of charge on request. The price of Units and the income from them can go down as well as up. Please note that past performance is not necessarily a guide to future performance. 04 s Series 1

8 ASEAN Equity Portfolio Statement As at 31 May 2012 The Portfolio of Investments - (analysed by geographical sector) (Ordinary shares quoted unless otherwise stated) Investment Holding $ % SINGAPORE (30.77%) CapitaLand Ltd 4,500,000 8,856, CapitaMalls Asia Ltd 4,300,000 4,683, DBS Group Holdings Ltd 2,012,568 20,682, Keppel Corp Ltd 1,430,000 11,102, Neptune Orient Lines Ltd 1,700,000 1,401, Overseas Union Enterprise Ltd 1,500,000 2,450, SembCorp Industries Ltd 1,575,000 5,917, SembCorp Marine Ltd 650,000 2,250, Singapore Telecommunications Ltd 5,930,000 14,254, Wilmar International Ltd 1,490,000 4,242, ,841, INDONESIA (23.24%) Astra International Tbk PT 1,900,000 12,996, Bank Mandiri Persero Tbk PT 13,350,152 9,657, Bank Negara Indonesia Persero Tbk PT 10,800,169 4,251, Gudang Garam Tbk PT 600,000 3,449, Harum Energy Tbk PT 2,300,000 1,480, Indocement Tunggal Prakarsa Tbk PT 1,280,000 2,410, Indofood CBP Sukses Makmur Tbk PT 7,000,000 4,170, Indofood Sukses Makmur Tbk PT 5,500,000 2,720, Mitra Adiperkasa Tbk PT 3,450,000 2,495, Perusahaan Gas Negara Persero Tbk PT 7,700,000 2,989, Semen Gresik Persero Tbk PT 1,840,000 2,114, Telekomunikasi Indonesia Persero Tbk PT 3,210,000 2,663, United Tractors Tbk PT 2,394,893 5,859, ,260, MALAYSIA (18.10%) Axiata Group Bhd 3,800,000 6,421, Berjaya Sports Toto Bhd 1,300,000 1,709, CIMB Group Holdings Bhd 1,850,000 4,357, DiGi.Com Bhd 1,500,000 1,886, Gamuda Bhd 2,500,000 2,672, Genting Bhd 1,540,000 4,850, Hong Leong Bank Bhd 930,000 3,583, IJM Corp BHD 1,900,000 3,109, Lafarge Malayan Cement Bhd 780,000 1,728, Sime Darby Bhd 2,880,000 8,780, Top Glove Corp Bhd 840,000 1,183, UEM Land Holdings Bhd 2,560,000 1,614, UOA Development Bhd 2,700,000 1,293, WCT Bhd 1,900,000 1,425, ,616, THAILAND (14.51%) Advanced Info Service PCL 330,000 1,918, Asian Property Development PCL 8,300,000 1,800, Bangkok Bank PCL 860,000 5,081, Banpu PCL 215,000 3,041, Kasikornbank PCL 1,860,000 9,061, Minor International PCL 8,500,000 3,473, PTT Global Chemical PCL 2,000,000 3,410, PTT PCL 410,000 4,020, Siam Cement PCL 233,000 2,504, Sino Thai Engineering & Construction PCL 3,620,000 1,433, ,746, s Series 1

9 ASEAN Equity Portfolio Statement (continued) As at 31 May 2012 The Portfolio of Investments - (analysed by geographical sector) Value of (Ordinary shares quoted unless otherwise stated) Investment Holding $ % PHILIPPINES (6.42%) Alliance Global Group Inc 13,400,000 3,837, Cebu Air Inc 860,000 1,354, Energy Development Corp 31,400,000 4,280, Megaworld Corp 32,000,000 1,463, Metropolitan Bank & Trust 1,370,001 2,779, Puregold Price Club Inc 4,000,000 2,110, ,824, UNITED KINGDOM (4.26%) Genting Singapore Plc 9,000,000 10,502, MAURITIUS (0.72%) Golden Agri-Resources Ltd 3,500,000 1,769, Total Value of Investments (Cost $233,087,164) 241,561, Cash and cash equivalents 8,120, Adjustment from bid-market prices to mid-market prices 816, Other Net Current Liabilities (4,063,536) (1.64) Total Value of the at 31 May ,434, Analysis of total assets % of Total assets Transferable securities to an Official Stock Exchange listing or dealt in an another regulated market Other assets s Series 1

10 ASEAN Equity Changes in the Composition of the Portfolio For the six months ended 31 May 2012 Purchases Cost $ Sales Proceeds $ Sime Darby Bhd 9,190,271 Wilmar International Ltd 5,919,897 CapitaMalls Asia Ltd 5,306,246 Bank Mandiri Persero Tbk PT 4,077,591 Singapore Telecommunications Ltd 4,434,712 CIMB Group Holdings Bhd 3,861,543 Wilmar International Ltd 4,099,195 SembCorp Marine Ltd 3,508,734 Genting Singapore Plc 3,384,306 Adaro Energy Tbk PT 3,346,622 Hong Leong Bank Bhd 3,305,886 IOI Corp Bhd 3,289,081 Perusahaan Gas Negara Persero Tbk PT 3,287,349 RHB Capital Bhd 3,183,349 Mitra Adiperkasa Tbk PT 2,656,573 Genting Bhd 3,056,161 Alliance Global Group Inc 2,351,417 Puregold Price Club Inc 2,956,985 Axiata Group Bhd 2,267,388 CapitaLand Ltd 2,874,950 Asian Property Development PCL 1,989,998 Astra International Tbk PT 2,639,538 Advanced Info Service PCL 1,943,933 Singapore Telecommunications Ltd 2,587,769 DiGi.Com Bhd 1,942,590 Golden Agri-Resources Ltd 2,566,533 Hemaraj Land and Development PCL 1,938,557 Gamuda Bhd 2,514,133 Berjaya Sports Toto Bhd 1,830,688 City Developments Ltd 2,500,462 Bank Mandiri Persero Tbk PT 1,822,298 IJM Corp BHD 2,431,042 Keppel Corp Ltd 1,657,162 Hemaraj Land and Development PCL 2,423,762 Sino Thai Engineering & Construction PCL 1,646,343 Petronas Chemicals Group Bhd 2,377,749 CIMB Group Holdings Bhd 1,626,124 Genting Singapore Plc 2,365,044 Megaworld Corp 1,585,993 Metropolitan Bank & Trust 2,318,721 Kasikornbank PCL 1,575,769 DBS Group Holdings Ltd 2,297,006 Metropolitan Bank & Trust 1,474,273 SembCorp Industries Ltd 2,207,662 Bank Negara Indonesia Persero Tbk PT 1,381,939 Top Glove Corp Bhd 2,076,390 DBS Group Holdings Ltd 1,171,607 Neptune Orient Lines Ltd/Singapore 2,062,316 Energy Development Corp 1,104,961 WCT Bhd 2,050,509 Bangkok Bank PCL 1,040,631 UEM Land Holdings Bhd 1,902,059 Gudang Garam Tbk PT 993,646 Energy Development Corp 1,722,844 Astra International Tbk PT 889,423 Pruksa Real Estate PCL 1,717,447 SembCorp Marine Ltd 846,989 Axiata Group Bhd 1,631,448 CapitaLand Ltd 754,695 Alliance Global Group Inc 1,507,407 Other Purchases 3,543,429 Keppel Corp Ltd 1,411,983 Total cost of purchases since 1 December 2011 $73,044,391 Metro Pacific Investments Corp 1,290,430 Cebu Air Inc 1,120,937 Siam Cement PCL 1,055,011 Other Sales 8,327,688 Total proceeds of sales since 1 December 2011 $93,180, s Series 1

11 Japanese Equity Investment Adviser s Report on behalf of the Manager Despite a strong rally during the first three months of the review period, the result of encouraging US economic indicators and additional easing measures by the Bank of Japan, the Japanese stock market lost steam, ending in negative territory over the six months. Weighing on sentiment was the belief that, in the eurozone, Greece and Spain appeared on the verge of crisis, while growth momentum in the US and China appeared to be slowing down. In the second half of the period, the strength of the Japanese yen, a perceived safe haven currency, also had a negative impact on the Japanese equity market. The s A Units fell by (4.56%) expressed in US$ terms over the six months to 31 May 2012, compared to the benchmark MSCI Japan index (net total return in US$) which lost (1.09%) of its value. This placed the in the fourth quartile of its peer group, the GIF OS Japan Large Cap Equity sector, which declined by an average (2.36%). The trailed its benchmark index due to its overweight position in the technology sector, with some companies not performing as well as had been expected. In addition, those sectors which are more linked to the fortunes of the economic cycle - paper, oil, materials, and as previously mentioned, technology stocks were out of favour. By contrast, automotive and shipping companies surged in value. Gains were also to be found in the retail, food, pharmaceuticals, and some financial stocks. By contrast, we sold Mitsumi Electronics, an electric parts and device manufacturer, NEC, an electronics company, Sekisui House, a major construction company and Nippon Sheet Glass. We also took profits in consumer electronics giant Panasonic. Despite the pro-bailout parties securing a majority ruling in Greece, we believe events in the eurozone will remain unsettled for some time to come. Discussion of a new banking union to support the beleaguered eurozone banking system might prevent further contagion risk and rebuild the confidence in the eurozone economy. However, in our view, its effectiveness will be unclear until it finally materialises. Despite the negative global backdrop, Japan s domestic economy is in relatively good health versus its global peers. Q inflation adjusted Gross Domestic Product (GDP) came in at an annualised 4.7% on the back of the reconstruction effort and the recovery in industrial production following last year s tragic earthquake and subsequent tsunami. We expect GDP to grow at an annualised rate of around 1.8% to 2% in subsequent quarters unless the global economy experiences a severe downturn. The recent sell-off in the Japanese equity market has opened up value across a whole range of sectors, giving us the opportunity to buy stocks at compelling valuations. Dated: 31/05/2012 Global Asset Management Limited In terms of portfolio activity we added three new holdings. These were: Yaskawa Electric, manufacturers of servomotors and industrial robots, Orix, financial service providers, and Pigeon, manufacturers of baby care products. We believe these companies have strong earnings growth potential, especially outside Japan, and are attractively priced given their current valuations. 08 s Series 1

12 Japanese Equity Performance Percentage change over: (All expressed in the share class base currency, mid to mid, gross income reinvested) Last 6 months Last Last 5 years 12 months (Cumulative) Japanese Equity A Units (4.56) (18.28) (53.70) Japanese Equity B Units (5.00) (19.06) (55.83) Japanese Equity C Units (4.29) (17.80) (52.36) MSCI Japan Index (benchmark) (1.09) (10.47) (32.26) Morningstar GIF OS Japan Large Cap Equity* (2.36) (11.64) (36.30) Source: Morningstar * For comparative purposes The Net Asset Value Information for 31 May 2012, 30 November 2011 and 31 May 2011 can be found on pages 26, 27 and 28. Price and Income Record The table below shows the highest and lowest NAV prices of Units in the s. There has never been an annual income distribution of the since its redomicile to Ireland. Highest NAV Price A Lowest NAV Price A Highest NAV Price B Lowest NAV Price B Highest NAV Price C Lowest NAV Price C Calendar Units Units Units Units Units Units Year $ $ $ $ $ $ Calendar Year Net Income per $2,000 Net Income Distribution invested in October 1992 A Units B Units C Units A Units B Units C Units $ $ $ $ $ $ Figures to 30 June The was redomiciled to Ireland on 9 February 1993 at a price of $15.83 per unit, excluding all Managers initial charges. Source: Global Asset Management Limited Distributions, if any, are paid annually to A, B and C Unitholders on or before 21 January and are set out in note 8. Reports on the progress of the are published on or before 31 March and on or before 31 July each year and shall be made available to Unitholders free of charge on request. The price of Units and the income from them can go down as well as up. Please note that past performance is not necessarily a guide to future performance. 09 s Series 1

13 Japanese Equity Portfolio Statement As at 31 May 2012 The Portfolio of Investments - (analysed by industrial sector) Value of (Ordinary shares quoted unless otherwise stated) Investment Holding $ % CONSUMER, CYCLICAL (31.39%) FamilyMart Co Ltd 25,300 1,139, Hitachi High-Technologies Corp 27, , Marubeni Corp 174,000 1,105, Mitsubishi Corp 80,000 1,553, Nagase & Co Ltd 40, , Nifco Inc/Japan 29, , Nintendo Co Ltd 5, , Nissan Motor Co Ltd 180,600 1,731, Nisshinbo Holdings Inc 46, , Panasonic Corp 21, , Sekisui Chemical Co Ltd 118,000 1,001, Sony Corp 43, , Suzuki Motor Corp 44, , Teijin Ltd 215, , Toho Co Ltd/Tokyo 15, , Toyoda Gosei Co Ltd 18, , Toyota Motor Corp 51,900 1,994, Yamaha Corp 46, , Yamaha Motor Co Ltd 35, , ,821, INDUSTRIAL (30.93%) Amada Co Ltd Npv 129, , Casio Computer Co Ltd 50, , Daifuku Co Ltd 86, , Daikin Industries Ltd 35, , East Japan Railway Co 14, , Fuji Machine Manufacturing Co Ltd 15, , FUJIFILM Holdings Corp 40, , Furukawa Electric Co Ltd 88, , Hitachi Ltd 246,000 1,394, Kurita Water Industries Ltd 25, , Kyocera Corp 15,000 1,230, Kyudenko Corp 27, , Maeda Road Construction Co Ltd 27, , Minebea Co Ltd 167, , Mitsubishi Heavy Industries Ltd 371,000 1,487, Obayashi Corp 202, , Ryosan Co Ltd 12, , Sanki Engineering Co Ltd 30, , Sanwa Holdings Corp 136, , Shin-Etsu Polymer Co Ltd 39, , Toshiba Corp 312,000 1,163, Tsubakimoto Chain Co 126, , Yaskawa Electric Corp 78, , ,606, BASIC MATERIALS (10.99%) Daicel Corp 157, , Denki Kagaku Kogyo KK 205, , Kaneka Corp 92, , Lintec Corp 34, , Mitsubishi Chemical Holdings Corp 167, , Mitsui Mining & Smelting Co Ltd 279, , Nippon Steel Corp 54, , Sumitomo Metal Mining Co Ltd 59, , Toyo Ink SC Holdings Co Ltd 109, , ,192, CONSUMER, NON-CYCLICAL (9.47%) Astellas Pharma Inc 35,000 1,362, Dai Nippon Printing Co Ltd 25, , Daiichi Sankyo Co Ltd 51, , House Foods Corp 18, , s Series 1

14 Japanese Equity Portfolio Statement (continued) As at 31 May 2012 The Portfolio of Investments - (analysed by industrial sector) Value of (Ordinary shares quoted unless otherwise stated) Investment Holding $ % CONSUMER, CYCLICAL (31.39%) FamilyMart Co Ltd 25,300 1,139, Hitachi High-Technologies Corp 27, , Marubeni Corp 174,000 1,105, Mitsubishi Corp 80,000 1,553, Nagase & Co Ltd 40, , Nifco Inc/Japan 29, , Nintendo Co Ltd 5, , Nissan Motor Co Ltd 180,600 1,731, Nisshinbo Holdings Inc 46, , Panasonic Corp 21, , Sekisui Chemical Co Ltd 118,000 1,001, Sony Corp 43, , Suzuki Motor Corp 44, , Teijin Ltd 215, , Toho Co Ltd/Tokyo 15, , Toyoda Gosei Co Ltd 18, , Toyota Motor Corp 51,900 1,994, Yamaha Corp 46, , Yamaha Motor Co Ltd 35, , ,821, INDUSTRIAL (30.93%) Amada Co Ltd Npv 129, , Casio Computer Co Ltd 50, , Daifuku Co Ltd 86, , Daikin Industries Ltd 35, , East Japan Railway Co 14, , Fuji Machine Manufacturing Co Ltd 15, , FUJIFILM Holdings Corp 40, , Furukawa Electric Co Ltd 88, , Hitachi Ltd 246,000 1,394, Kurita Water Industries Ltd 25, , Kyocera Corp 15,000 1,230, Kyudenko Corp 27, , Maeda Road Construction Co Ltd 27, , Minebea Co Ltd 167, , Mitsubishi Heavy Industries Ltd 371,000 1,487, Obayashi Corp 202, , Ryosan Co Ltd 12, , Sanki Engineering Co Ltd 30, , Sanwa Holdings Corp 136, , Shin-Etsu Polymer Co Ltd 39, , Toshiba Corp 312,000 1,163, Tsubakimoto Chain Co 126, , Yaskawa Electric Corp 78, , ,606, BASIC MATERIALS (10.99%) Daicel Corp 157, , Denki Kagaku Kogyo KK 205, , Kaneka Corp 92, , Lintec Corp 34, , Mitsubishi Chemical Holdings Corp 167, , Mitsui Mining & Smelting Co Ltd 279, , Nippon Steel Corp 54, , Sumitomo Metal Mining Co Ltd 59, , Toyo Ink SC Holdings Co Ltd 109, , ,192, CONSUMER, NON-CYCLICAL (9.47%) Astellas Pharma Inc 35,000 1,362, Dai Nippon Printing Co Ltd 25, , Daiichi Sankyo Co Ltd 51, , House Foods Corp 18, , s Series 1

15 Japanese Equity Portfolio Statement (continued) As at 31 May 2012 The Portfolio of Investments - (analysed by industrial sector) Value of (Ordinary shares quoted unless otherwise stated) Investment Holding $ % CONSUMER, NON-CYCLICAL (9.47%) (continued) Nippon Meat Packers Inc 35, , Ono Pharmaceutical Co Ltd 20,000 1,117, Pigeon Corp 6, , ,473, TECHNOLOGY (9.29%) Canon Inc 45,800 1,824, Fujitsu Ltd 212, , Ricoh Co Ltd 54, , Rohm Co Ltd 10, , TDK Corp 20, , ,387, FINANCIAL (4.92%) Hitachi Capital Corp 41, , Mitsubishi Estate Co Ltd 72,000 1,108, ORIX Corp 7, , ,321, COMMUNICATIONS (1.70%) Nippon Telegraph & Telephone Corp 18, , Total Value of Investments (Cost $54,637,101) 46,602, Cash and cash equivalents 49, Adjustment from bid-market prices to mid-market prices 93, Other Net Current Assets 476, Total Value of the at 31 May ,222, % of Analysis of total assets Total Assets Transferable securities admitted to an official stock exchange listing or dealt in on another regulated market Other assets s Series 1

16 Japanese Equity Changes in the Composition of the Portfolio For the six months ended 31 May 2012 Purchases Cost $ Sales Proceeds $ Yaskawa Electric Corp 746,325 Panasonic Corp 732,997 ORIX Corp 674,968 Mitsubishi Corp 728,580 Toyota Motor Corp 584,724 Canon Inc 585,516 Mitsubishi Estate Co Ltd 494,016 Mitsubishi Heavy Industries Ltd 583,650 Nissan Motor Co Ltd 378,707 Toyota Motor Corp 567,603 Mitsubishi Heavy Industries Ltd 366,397 Nissan Motor Co Ltd 551,785 Sony Corp 293,581 Hitachi Ltd 484,026 Canon Inc 275,644 Fujitsu Ltd 475,281 Mitsubishi Chemical Holdings Corp 270,046 Marubeni Corp 468,528 Astellas Pharma Inc 265,299 Hitachi Capital Corp 458,430 Pigeon Corp 261,033 Astellas Pharma Inc 449,406 Amada Co Ltd 248,246 Toshiba Corp 436,612 Fujitsu Ltd 235,046 Kyocera Corp 430,934 FamilyMart Co Ltd 234,471 Nippon Sheet Glass Co Ltd 429,748 Mitsubishi Corp 232,248 NEC Corp 426,004 Toshiba Corp 228,108 Nippon Telegraph & Telephone Corp 395,745 Hitachi Ltd 224,333 Sekisui Chemical Co Ltd 382,524 Obayashi Corp 213,617 Sekisui House Ltd 380,170 Daicel Corp 211,513 Suzuki Motor Corp 369,644 FUJIFILM Holdings Corp 211,367 Ono Pharmaceutical Co Ltd 350,365 Minebea Co Ltd 210,527 Daikin Industries Ltd 346,484 Sekisui Chemical Co Ltd 199,801 FUJIFILM Holdings Corp 339,817 Marubeni Corp 191,515 Daiichi Sankyo Co Ltd 324,311 Teijin Ltd 182,297 Ricoh Co Ltd 310,118 East Japan Railway Co 176,828 Nintendo Co Ltd 307,806 Kyocera Corp 174,161 Furukawa Electric Co Ltd 306,424 Daikin Industries Ltd 173,804 FamilyMart Co Ltd 300,322 Ono Pharmaceutical Co Ltd 166,776 Sony Corp 299,687 Mitsui Mining & Smelting Co Ltd 166,280 Mitsubishi Estate Co Ltd 294,405 Sumitomo Metal Mining Co Ltd 164,342 Mitsubishi Chemical Holdings Corp 278,318 Denki Kagaku Kogyo KK 162,105 Daicel Corp 278,141 Nippon Telegraph & Telephone Corp 162,051 Amada Co Ltd 273,340 Tsubakimoto Chain Co 159,428 TDK Corp 259,014 Suzuki Motor Corp 154,467 Teijin Ltd 257,111 Nintendo Co Ltd 142,334 Nifco Inc/Japan 255,492 Hitachi High-Technologies Corp 137,670 Sumitomo Metal Mining Co Ltd 254,892 Nifco Inc/Japan 137,267 Denki Kagaku Kogyo KK 253,746 Lintec Corp 136,933 Mitsui Mining & Smelting Co Ltd 247,935 Daiichi Sankyo Co Ltd 131,139 Obayashi Corp 246,661 Yamaha Motor Co Ltd 120,728 Yamaha Motor Co Ltd 245,826 TDK Corp 115,074 Minebea Co Ltd 214,384 Daifuku Co Ltd 113,906 Dai Nippon Printing Co Ltd 212,522 Hitachi Capital Corp 113,056 Hitachi High-Technologies Corp 205,569 Other Purchases 1,049,776 Rohm Co Ltd 200,329 Total cost of purchases since 1 December 2011 $11,291,954 Lintec Corp 198,108 Tsubakimoto Chain Co 197,742 Other Sales 2,944,503 Total proceeds of sales since 1 December 2011 $19,540, s Series 1

17 Pacific Equity Investment Adviser s Report on behalf of the Manager Macroeconomic risks to the global economy appeared to have eased at the start of the period and Pacific equity markets initially enjoyed strong returns. However, early gains were generally reversed as the Eurozone debt crisis deepened and concerns grew over the strength of the US recovery and a slowdown in China s economy. Thailand and the Philippines, with their resilient domestic economies ended the period markedly higher, while Japan, India and Indonesia lost ground as other markets held onto gains in dollar terms. In response to a slowing economy and subsiding inflation, the Chinese authorities have selectively eased policy, cutting reserve requirement ratios for banks and more recently interest rates for the first time since November Elsewhere, inflationary pressures appeared to have eased, with the exception of India and Indonesia, prompting central banks to ease monetary policy in support of their economies. Over the six months to the end of May 2012 the s A Units rose by 0.68% (USD), in line with the MSCI All Countries Pacific index. This placed the in the second quartile of its peer group, the GIF OS Asia Pacific inc. Japan sector, which declined by an average of (1.32%). The s significant exposure to the technology sector contributed positively to relative returns, with good stock selection adding further value. Holdings in Chinese internet companies performed particularly well, with NetEase having the single biggest impact thanks to strong quarterly earnings and a robust outlook for online gaming in China. Samsung Electronics and Venture Corp. also added value on betterthan-expected earnings. Elsewhere, stock selection in commercial banks benefited overall performance. Meanwhile, the s exposure to Japan detracted, particularly holdings in auto manufacturers. Yamaha Motor faced challenging conditions in some of its key markets, while Mazda Motor endured a tough fiscal year ending March 2012, although expectations are for the company to see an improvement in earnings in the current year. Elsewhere, exposure to manufacturers of electric appliances and semiconductors equipment in Japan detracted as concerns grew over the outlook for global demand and the impact of a stronger yen. We seek to capitalise on the growth of domestic demand in Asia, with a focus on selecting companies that we believe offer good earnings quality whilst being attractively valued. This includes Chinese internet stocks and franchises with indirect and undervalued exposure to consumption growth such as Hong Kong-based conglomerates Jardine Matheson and Hutchison Whampoa. We also hold what we consider to be best-in-class technology companies that have strong competitive advantages and low cost bases, enabling them to enhance their profitability in a tough macroeconomic environment. We continue to favour selected companies in China and Hong Kong which offer underappreciated long-term growth potential, in our view, as well as Korean companies that are undervalued in our opinion. The Japanese element of the has significant exposure to financials and large, globally orientated exporters. We also hold positions in selected technology groups where valuations are particularly attractive in our view. While Asian economic growth is slowing, it remains robust and well ahead of that being generated by developed economies. Strong fundamentals such as rising levels of income and consumption as well as low levels of leverage continue to underpin our positive outlook for Asian equity markets. In our view, much bad news already appears to have been discounted in what are relatively low valuation levels. However, short-term performance is likely to continue to be influenced by global events, at least until European policymakers deliver a coordinated and measured response to the current debt crisis. Current expectations for Japanese economic growth in 2012 are around 1.5% to 2% - boosted by reconstruction spending. We expect to see a rebound in corporate earnings after the exceptional events of 2011, further supported by an improved domestic outlook, sustainable recovery in the US and ongoing growth in Asia. In our view, current valuations do not fully recognise the profit growth potential of Japanese companies in Dated: 31/05/2012 Global Asset Management Limited 14 s Series 1

18 Pacific Equity Performance Percentage change over: (All expressed in the share class base currency, Last Last Last 5 years mid to mid, gross income reinvested) 6 months 12 months (Cumulative) Pacific Equity A Units 0.68 (15.92) (3.54) Pacific Equity B Units 0.22 (16.67) (7.92) Pacific Equity C Units 0.96 (15.42) (0.74) Pacific Equity I Units 9.13 (0.40) 9.21 MSCI AC Pacific Index (benchmark) 0.61 (14.39) (15.38) Morningstar GIF OS Asia-Pacific Inc. Japan* (1.32) (17.30) (19.08) Source: Morningstar * For comparative purposes The Net Asset Value Information for 31 May 2012, 30 November 2011 and 31 May 2011 can be found on pages 26, 27 and 28. Price and Income Record The table below shows the highest and lowest NAV prices of Units in the s and the annual income distribution of the in the last 10 years. Calendar Year Highest NAV Price A Units Lowest NAV Price A Units Highest NAV Price B Units Lowest NAV Price B Units Highest NAV Price C Units Lowest NAV Price C Units Highest NAV Price I Units Lowest NAV Price I Units $$ $ $ $ $ $ Calendar Net Income per $2,000 Year Net Income Distribution invested in October 1992 A Units B Units C Units I Units A Units B Units C Units I Units $$ $ $ $ $ $ Figures to 30 June The was redomiciled to Ireland on 20 November 1992 at a price of $15.78 per Unit, excluding all Managers initial charges. Source: Global Asset Management Limited. Distributions, if any, are paid annually to A, B and C Unitholders on or before 21 January and are set out in note 8. Reports on the progress of the are published on or before 31 March and on or before 31 July each year and shall be made available to Unitholders free of charge on request. The price of Units and the income from them can go down as well as up. Please note that past performance is not necessarily a guide to future performance. 15 s Series 1

19 Pacific Equity Portfolio Statement As at 31 May 2012 The Portfolio of Investments - (analysed by geographical sector) Value of (Ordinary shares quoted unless otherwise stated) Investment Holding $ % JAPAN (42.19%) Amada Co Ltd Npv 48, , Canon Inc 31,600 1,258, Daiwa Securities Group Inc 624,000 1,954, East Japan Railway Co 19,200 1,133, Honda Motor Co Ltd 62,200 1,975, Hoya Corp 95,600 2,034, Ibiden Co Ltd 52, , JFE Holdings Inc 83,200 1,338, Kawasaki Kisen Kaisha Ltd 613,000 1,127, Konica Minolta Holdings Inc 289,000 2,052, Mazda Motor Corp 970,000 1,218, Mitsubishi Estate Co Ltd 158,000 2,432, Mitsubishi UFJ Financial Group Inc 523,600 2,251, Mori Seiki Co Ltd 163,100 1,388, Nissan Chemical Industries Ltd 65, , Nissha Printing Co Ltd 30, , Nomura Holdings Inc 557,200 1,823, NTT DoCoMo Inc , NTT Urban Development Corp 2,413 1,726, Resona Holdings Inc 436,400 1,627, Shinko Electric Industries Co Ltd 214,000 1,536, Sumco Corp 170,800 1,427, Sumitomo Mitsui Financial Group Inc 78,300 2,268, Taiyo Yuden Co Ltd 195,600 1,714, TDK Corp 33,800 1,451, THK Co Ltd 19, , Tokyo Electron Ltd 49,500 2,216, Toyota Motor Corp 37,800 1,452, Yamaha Motor Co Ltd 183,300 1,799, ,575, SOUTH KOREA (13.35%) DGB Financial Group Inc 89,570 1,111, E-Mart Co Ltd 5,780 1,278, Hyundai Mobis 2, , Hyundai Motor Co 22,047 1,415, Korea Investment Holdings Co Ltd 30,700 1,027, KT&G Corp 14, , POSCO 4,111 1,255, Samsung Electronics Co Ltd 3,515 3,606, Samsung Fire & Marine Insurance Co Ltd 7,927 1,410, Shinhan Financial Group Co Ltd 29, , ,480, CAYMAN ISLANDS (9.65%) Changyou.com Ltd ADR 46,577 1,024, Charm Communications Inc ADR 70, , Daphne International Holdings Ltd 760, , E-House China Holdings Ltd ADR 188,166 1,034, HKR International Ltd 2,029, , Mindray Medical International Ltd ADR 60,584 1,836, NetEase Inc ADR 39,931 2,451, Shanda Games Ltd ADR 179, , Tencent Holdings Ltd 21, , ,710, HONG KONG (6.11%) Cheung Kong Holdings Ltd 97,000 1,115, s Series 1

20 Pacific Equity Portfolio Statement (continued) As at 31 May 2012 The Portfolio of Investments - (analysed by geographical sector) Value of (Ordinary shares quoted unless otherwise stated) Investment Holding $ % HONG KONG (6.11%) (continued) China Mobile Ltd 180,500 1,818, China Taiping Insurance Holdings Co Ltd 545, , CNOOC Ltd 300, , Hutchison Whampoa Ltd 216,000 1,773, ,153, AUSTRALIA (5.91%) Australia & New Zealand Banking Group Ltd 44, , Caltex Australia Ltd 89,947 1,196, Dart Energy Ltd 462,517 94, Fairfax Media Ltd 1,175, , Metcash Ltd 263, , Newcrest Mining Ltd 29, , QBE Insurance Group Ltd 55, , Westpac Banking Corp 33, , ,956, TAIWAN (5.00%) China Life Insurance Co Ltd 680, , E.Sun Financial Holding Co Ltd 1,136, , Hon Hai Precision Industry Co Ltd 553,332 1,622, Taiwan Semiconductor Manufacturing Co Ltd 542,371 1,546, Yageo Corp 2,269, , ,047, BERMUDA (3.28%) Jardine Matheson Holdings Ltd 46,473 2,248, Pacific Basin Shipping Ltd 2,368,000 1,055, Worldsec Ltd 90,000 2,790 3,306, UNITED KINGDOM (2.20%) HSBC Holdings Plc 212,307 1,674, Standard Chartered Plc 26, , ,218, SINGAPORE (1.95%) United Overseas Bank Ltd 52, , Venture Corp Ltd 205,000 1,264, ,975, INDIA (1.81%) Infosys Ltd 17, , United Phosphorus Ltd 533,182 1,051, ,831, PHILIPPINES (1.73%) Filinvest Land Inc 43,014,000 1,247, Philippine Long Distance Telephone Co 9, , ,736, THAILAND (1.52%) Bangkok Bank PCL 272,500 1,537, CHINA (1.45%) Guangzhou Automobile Group Co Ltd 456, , Qingling Motors Co Ltd 1,484, , s Series 1

21 Pacific Equity Portfolio Statement (continued) As at 31 May 2012 The Portfolio of Investments - (analysed by geographical sector) Value of (Ordinary shares quoted unless otherwise stated) Investment Holding $ % CHINA (1.45%) (continued) Wumart Stores Inc 305, , ,461, UNITED STATES (1.13%) Sohu.com Inc 25,483 1,140, Total Value of Investments (Cost $114,875,292) 98,132, Cash and cash equivalents 1,658, Adjustment from bid-market prices to mid-market prices 224, Other Net Current Assets 863, Total Value of the at 31 May ,878, % of Analysis of total assets Total Assets Transferable securities admitted to an official stock exchange listing or dealt in on another regulated market Other assets s Series 1