LIONTRUST FUND PARTNERS LLP

Transcription

1 Manager's Long Interim Report and Financial Statements for the period ended 30 November 2014 LIONTRUST FUND PARTNERS LLP

2 Manager Liontrust Fund Partners LLP 2 Savoy Court London WC2R 0EZ Administration and Dealing enquiries Administration and Dealing facsimile [email protected] Website Authorised and regulated by the Financial Conduct Authority. Investment Adviser State Street Global Advisers Limited 20 Churchill Place London E14 5HJ Authorised and regulated by the Financial Conduct Authority. Trustee State Street Trustees Limited 20 Churchill Place London E14 5HJ Authorised and regulated by the Financial Conduct Authority. Registrar International Financial Data Services Limited IFDS House St. Nicholas Lane Basildon Essex SS15 5FS Authorised and regulated by the Financial Conduct Authority. Independent Auditors PricewaterhouseCoopers LLP Atria One 144 Morrison Street Edinburgh EH3 8EX

3 Investment Profile The Liontrust FTSE 100 Tracker Fund tracks the performance of the FTSE 100 index, which comprises the one hundred largest companies by market capitalisation listed on the London Stock Exchange. The index was created in Its constituent companies account for around 80% of the capitalisation of companies traded on the London Stock Exchange. Contents Manager s Investment Report* 3 Performance Record 8 Authorised Status* 9 Certification of Financial Statements by Directors of the Manager* 9 Portfolio Statement* 10 Financial Statements: Statement of Total Return 13 Statement of Change in Net Assets Attributable to Unitholders 13 Balance Sheet 14 Additional Information 15 *Collectively, these comprise the Manager's Report. 2

4 MANAGER S INVESTMENT REPORT Investment objective The investment objective of Liontrust FTSE 100 Tracker Fund is to match the capital performance of the FTSE 100 Index, which comprises the UK s one hundred largest companies. It will be achieved principally by replicating the constituents of the FTSE 100 Index. However, in managing the short-term liquidity of the Fund and its income, the Manager may, from time to time, invest in FTSE 100 Index futures in accordance with the rules of the COLL Sourcebook regarding hedging. Liontrust Asset Management PLC Liontrust, which was launched in 1995, is an independent fund management group whose shares are quoted on the London Stock Exchange. Liontrust manages 3.8 billion (as of 30 September 2014) in UK, European, Asian and Global equities, Global Credit and Multi-Manager Multi-Asset. We take pride in having a distinct culture and approach to asset management. This comes through the following factors: Liontrust is an independent business with no corporate parent. Liontrust specialises in those asset classes where it believes it has particular expertise and fund managers have strong long-term track records rather than try to be all things to all people. Liontrust uses rigorous investment processes that are robust and scaleable to ensure they are capable of delivering superior long-term performance. Using these investment processes ensures the way we manage money is predictable and repeatable. We aim to provide a culture that gives all fund managers the freedom to manage their portfolios according to their own investment processes and market views. We have created an environment in which fund managers can focus on running money and not get distracted by other day-to-day aspects of running a fund management business, particularly administration. We aim to treat clients, investors, members, employees and suppliers fairly and with respect. Therefore, we are committed to the principles of Treating Customers Fairly (TCF) and they are central to how we conduct business across all our functions. Liontrust Asset Management PLC is the parent company of Liontrust Fund Partners LLP and Liontrust Investment Partners LLP, which are authorised and regulated by the Financial Conduct Authority. All members of the Liontrust Group sell only Liontrust Group products. Performance of the Fund In the period to 30 November 2014 an investment in the Fund returned -1.1% compared with a return of -0.1% in the FTSE 100 Index. From the Fund s launch on 14 July 1995 to 30 November 2014, an investment in the Fund rose by 237.9%, compared to a rise of 278.0% in the FTSE 100 Index. Source: Financial Express, bid to bid basis, total return. A dividend distribution of 6.11 pence per unit was paid on 31 July The Fund aims to achieve its objective by investing in an optimised portfolio of constituents of the FTSE 100 Index to provide broad exposure to the benchmark whilst minimising costs. The tracking difference (the difference between the performance of the Fund and the performance of the index tracked) for the period to 30 November 2014 is -1.0%. The tracking difference is based on actual portfolio returns calculated at the valuation point (12pm) and the actual benchmark returns calculated at close of business (4.30pm) and also incorporates the effects of Fund expenses, trading activity, using futures for efficient portfolio management and holding cash in the fund over the course of the year. Past performance is not a guide to future performance. The value of investments and the income from them can fall as well as rise. 3

5 MANAGER S INVESTMENT REPORT Risk and Reward Profile The Risk disclosures are in accordance with CESR guidelines and are consistent with the rating disclosed in the KIID. Lower Risk Typically lower rewards Higher Risk Typically higher rewards The indicator is based upon historical data and may not be relied upon to gauge the future risk profile of the Fund. The risk and reward indicator shown is not guaranteed and may shift over time. The lowest category (1) does not mean risk free. The Fund s risk and reward category has been calculated using the methodology set by the European Commission. It is based upon the rate by which the Fund s value has moved up and down in the past. The Fund is categorised 6 primarily for its exposure to securities (equity) of UK companies which comprise the FTSE 100 index. The risk and reward indicator does not take into account the following Fund risks: That a company may fail thus reducing its value within the Fund. Any company which has high overseas earnings may carry a higher currency risk as for valuation purposes, local receipts may require conversion into the currency of the Fund, which is pounds sterling. As exchange rates fluctuate the valuation of overseas earnings may have positive and negative effects on the value of the Fund. The Fund may, from time to time, invest in FTSE 100 index futures in order to manage investment flows efficiently. Performance of the FTSE 100 Index In the six months to 30 November 2014 the FTSE 100 index delivered a total return, including dividends, of - 0.1%. In capital terms, the index lost 1.8%, falling 122 points from its starting level of 6,845 points to finish at 6,723. The total return from the FTSE 100 Tracker Fund over the period was -1.1%. Much of the differential between the return from the index and the tracker is explained by their different pricing points: end of day for the index and midday for the tracker. On the final trading day of the period the 28 th November the FTSE 100 rose by about 40 points in the afternoon. This intraday rally is captured in the index return but not the tracker fund, which was valued at midday prior to the rise. The UK equity market struggled for direction over the period as investors dealt with persistent geopolitical risks in Ukraine and the Middle East, the impending end to the US Federal Reserve s ( The Fed ) Quantitative Easing (QE) programme, and an outlook for slowing global growth. The main casualty of the last of these factors was the oil & gas industry. The oil price fell 36% over the six months to $66.2/barrel and FTSE 100 constituents including BP (-13.9%), BG Group (-25.7%), Royal Dutch Shell (-6.4%) and Tullow Oil (-49.2%) fell significantly. Between them, these four companies had a negative effect on the index of about 170 points. Fears over growth were offset by the prospect of more accommodative monetary policy outside of the US. The European Central Bank (ECB) gave a number of indications of its intention to deploy QE measures and the Bank of Japan (BoJ) announced its own surprise increase in its QE programme in October. 4

6 MANAGER S INVESTMENT REPORT The biggest FTSE 100 riser in both percentage and market capitalisation weighted terms was pharmaceutical company Shire (+33.5%). Following a number of indicative offers, it accepted a takeover approach from US peer AbbVie and shares in Shire rose substantially over the six months despite the deal eventually falling through. Friends Life (+20.6%) was another to benefit from merger and acquisition (M&A) activity as it received and recommended a takeover approach from life insurance peer Aviva. Outside of the oil & gas companies, another area of index weakness was the supermarkets sector. Price competition in the sector was fierce as the incumbents including Tesco (-38.1%), J Sainsbury (-31.1%) and WM Morrison (-9.0%) struggled to cope with competition from Aldi and Lidl. Tesco was particularly badly affected, issuing a number of profit warnings, replacing its CEO and announcing some accounting irregularities. The highlights of each month follow: June: The FTSE 100 lost 100 points, or 1.5%, to finish June at 6,744. While the ECB loosened monetary policy, cutting its refinancing rate and deposit rates to 0.15% and -0.10% respectively and offering eurozone banks up to 400bn in cheap loans, Bank of England Governor Mark Carney stated that UK rises could happen sooner than markets currently expect. The UK market reacted negatively to the comments. Banks were among the worst performing stocks. Barclays (-13.8%) was the biggest index faller, closely followed by Standard Chartered (-11.1%), which issued a profit warning in the month. Tensions in Iraq fed through to a firm oil price as Islamist insurgents attacked infrastructure in the north of the country. The oil price rise of 2.5% benefited the oil & gas majors BG (+1.5%), BP (+2.4%) and Royal Dutch Shell (+4.4%). The FTSE 100 s biggest riser in percentage terms was pharmaceutical company Shire (+33.9%). It was revealed that the company had received a number of indicative takeover offers from US peer AbbVie. Shire rejected all the offers. The quarterly review of index constituents resulted in Melrose, a manufacturer of products for utilities, and bookmaker William Hill being replaced by private equity group 3i and Intu Properties, a Real Estate Investment Trust which owns a number of shopping centres. July: Geopolitical risks contributed to another month of negative returns for the index, which fell 14 points to 6,730. A Malaysian airliner was shot down in eastern Ukraine, with pro-russian rebels believed to be culpable. This led to some flight to safety trends as safe haven assets such as government bonds and gold rose, while equities came under pressure amid rising volatility. Russian assets already under pressure due to economic sanctions from the US and Europe suffered large falls. Fears over the health of eurozone periphery nations were also reignited by the emergence of accounting irregularities at Portugal s Banco Espirito Santo which caused its shares to tumble. The Fed continued to taper it QE programme by announcing a further cut in monthly asset purchases to $25bn. It stated that there was still significant underutilisation of labour resources suggesting that interest rate rises were not imminent. Mining companies led the risers in July with Rio Tinto (+9.1%), Glencore (+10.6%), BHP Billiton (+7.4%) and Anglo American (+11.8%) all featuring among the biggest gainers. Economic data from China during the month was strong; for example, the flash estimate of the Purchasing Manager s Index for July was 52, the highest level so far in the year, and ahead of the level (50) that indicates economic expansion. Shares in Shire (+7.0%) rose again after the company received two raised bids from AbbVie and recommended the latter to its shareholders. Tesco shares performed poorly, falling 9.2% as the supermarket sector continued to suffer from intense price competition in an attempt to fend off Aldi and Lidl. Tesco responded by removing its CEO Philip Clarke and announcing the appointment of Unilever executive Dave Lewis. Royal Mail (-13.8%) was also among those to fall after a trading update referred to weak trends in its parcels division due to intensifying competition. 5

7 MANAGER S INVESTMENT REPORT August: Global equity markets made strong gains in August despite the tensions in Ukraine persisting and the progress made by the Islamic State group in the Middle East. Much of the positive mood in markets can be attributed to comments from ECB President Mario Draghi at an economic policy conference in Jackson Hole, Wyoming. He said that all available instruments would be used to offset falling inflation expectations, raising the prospect of QE in continental Europe. The Bank of England (BoE) halved its forecast for 2014 wage growth within its quarterly inflation report to 1.25% but said that growth in the economy is on track. Interest rates were maintained at 0.5% due to insufficient evidence of inflationary pressures but two of the monetary policy committee s nine members voted for a rate rise, a larger minority than had been expected. The FTSE 100 gained 90 points, or 1.3%, to 6,820 as 72 of its constituents experienced gains. The supermarket sector, however, remained weak. Tesco (-10.9%) was the biggest faller in percentage terms and J Sainsbury (- 7.2%) was also among the 10 worst performing stocks. The ONS released data showing July food store spending fell 1.3% year-on-year, the first fall since it began compiling retail sales data in September: Resource-related companies dragged the FTSE % lower in September. The index finished the month down 197 points at 6,623. A lack of confidence in the the outlook for global growth appeared to grow as investors looked beyond the US QE programme, which continued to taper towards its expected termination. BP (-5.9%), BHP Billiton (-8.1%), Royal Dutch Shell (-4.3%) and Rio Tinto (-5.7%) were among those to suffer share price falls. Volatility was accentuated on the UK market by the Scottish independence referendum. The impending vote led to fluctuations in the sterling exchange rate and in the shares of companies with Scottish exposure particularly among the financial sector. Although some polls early in the month had put the yes vote ahead for the first time, the referendum ultimately returned a vote in favour of the better together campaign. The biggest index faller in percentage terms was Tesco (-19.0%). The company announced that it had overstated its interim profit by 250m as it failed to account for supplier rebates correctly. Following the quarterly index review, housebuilder Barratt Developments and drinks can maker Rexam were demoted to the FTSE 250, and replaced by Direct Line Insurance and electricals retailer Dixons Carphone. October: Shares in oil & gas companies came under significant pressure as global growth fears mounted and the oil price slide accelerated. The head of the International Monetary Fund (IMF), Christine Lagarde, warned that the world economy may be facing a new mediocre level of low growth ahead of announcing cuts to the organisation s economic growth forecasts. The International Energy Agency cut its forecast for oil demand growth, citing reduced expectations of economic growth. The oil price fell 12% to $80.5 per barrel over the month. As expected, the Fed announced the completion of QE tapering after its October policy meeting. The FTSE 100 fell 159 points to 6,622. Tullow Oil was the biggest faller in percentage terms, 24.6% lower after announcing a dry well offshore Gabon. BG Group (-8.8%) was also among those negatively affected by the oil price decline. The index fall would have been worse but for a strong rally in the second half of the month. The recovery in sentiment was driven by increased hopes of large-scale ECB stimulus and the surprise announcement from the BoJ of an increase in its own QE programme. US pharmaceuticals company AbbVie announced the withdrawal of its bid for Shire after a clampdown by US authorities on tax-motivated merger deals. Shares in Shire fell 22.0%, representing the biggest drag on the index in market capitalisation weighted terms. November: The FTSE 100 managed to post a gain, adding 176 points (+2.7%) to 6,722, despite a large headwind from its oil & gas companies. The oil price fell a further 18% to $66.2 a barrel in November. The Organisation of the Petroleum Exporting Countries (OPEC) refused to cut its output targets in response to the price fall. The five biggest index fallers for 6

8 MANAGER S INVESTMENT REPORT the months were oil & gas producers, or providers of engineering and support services to the industry: Petrofac (-22.2%), Weir Group (-17.8%), Intertek (-14.2%), BG Group (-13.4%) and Tullow Oil (-12.3%). The BoE s quarterly report forecast low rates of inflation, leading to expectations of interest rates being kept at low levels, which boosted investor sentiment. Mario Draghi also made yet another reference to the possibility of more monetary stimulus in future. The telecoms sector was a positive feature of the index. Both Vodafone (+14.8%) and BT Group (+11.6%) mobile and fixed-line operators respectively were among the risers. Industry consolidation talk was sparked by BT s confirmation that it was in discussions regarding a deal to buy a mobile network: either O2 (owned by Telefonica) or EE (jointly owned by Orange and Deutsche Telekom). Friends Life (+14.2%) was another to see its shares perform well after it recommended a takeover offer from life insurance peer Aviva. Liontrust Fund Partners LLP December 2014 Manager s Report The manager's investment report, together with information on the authorised status of the Fund, the objectives and policy of the Fund, the information on page 1 and the portfolio statement, comprise the Manager's Report. Past performance is not a guide to future performance. The value of investments and the income from them can fall as well as rise. 7

9 Performance Record Net Asset Value and Ongoing Charges Figure The table below shows the number of units in issue, the total net asset value of the property of the Fund, the net asset value per unit and the ongoing charges figure: Units in issue Net asset value of unit class ( ) Net asset value per unit (p) *Ongoing charges figure (%) Retail Income 31/05/12 29,735,345 46,022, n/a Income 31/05/13 29,281,332 55,861, Income 31/05/14 28,425,855 56,408, Income 30/11/14 28,674,508 56,270, The calculation of the net asset value for the current year uses bid prices in line with the requirements of the Statement of Recommended Practice (SORP) for Authorised Funds issued by the IA in October To comply with the requirements of the UCITS IV Directive the Total Expense Ratio has been replaced with an Ongoing Charges Figure ("OCF") on 30 June *The OCF covers all aspects of operating a fund during the course of its financial year. These include the annual charge for managing the Fund, administration and independent oversight functions, such as trustee, depositary, custody, legal and audit fees. The OCF excludes portfolio transaction costs except for an entry/exit charge paid by the Fund when buying or selling units in another fund. This will have an impact on the realisable value of the investment particularly in the short-term. Unit price history and revenue record The table below shows the highest buying price, the lowest selling price of units and the net income distributions made by the Fund for the last five years. Retail Year Highest offer (buying) price (p) Lowest bid (selling) price (p) Net income per unit (p) Net income per 1,000 invested at 02/01/09 ( ) Income Income Income Income Income Income 2014 (to 30.11) The Fund distributes income once per annum, on 31 July. The ex-dividend date is 1 June each year. Income can be reinvested to purchase units at no initial charge. 8

10 Authorised Status The Fund is an authorised unit trust scheme ( the Scheme ) under Section 243 of the Financial Services and Markets Act 2000 (authorisation orders) and the Financial Conduct Authority s Collective Investment Schemes Sourcebook and is categorised as a UCITS scheme. Certification of Financial Statements by Directors of the Manager We certify that this Manager s Report has been prepared in accordance with the Financial Conduct Authority s Collective Investment Schemes Sourcebook. John Ions Chief Executive Antony Morrison Partner, Head of Finance Liontrust Fund Partners LLP 30 January

11 Portfolio Statement as at 30 November 2014 (Ordinary shares except where otherwise stated) Holdings Market Value '000 Percentage of total net assets % EQUITIES (98.78%*) BASIC MATERIALS (8.52%*) 4, Anglo American 42, Antofagasta 11, BHP Billiton 69,201 1, Fresnillo 5, Glencore Xstrata 345,733 1, Johnson Matthey 6, Mondi 11, Randgold Resources 2, Rio Tinto 40,417 1, CONSUMER GOODS (15.57%*) 8, Associated British Foods 11, British American Tobacco 60,384 2, Burberry 14, Coca-Cola 6, Diageo 81,593 1, GKN 52, Imperial Tobacco 31, Persimmon 9, Reckitt Benckiser 20,898 1, SABMiller 30,625 1, Unilever 39,083 1, CONSUMER SERVICES (9.59%*) 5, British Sky Broadcasting 33, Carnival 5, Compass 54, Dixons Carphone 29, easyjet 8, InterContinental Hotels 7, International Consolidated Airlines 66, ITV 121, Kingfisher 76, Marks & Spencer 53, Next 4, Pearson 26, Reed Elsevier 37, Sainsbury (J) 45, Sports Direct International 8, Tesco 264, TUI Travel 16, Whitbread 5, Wm Morrison Supermarkets 69, WPP 43,

12 Portfolio Statement as at 30 November 2014 (Ordinary shares except where otherwise stated) Holdings Market Value '000 Percentage of total net assets % FINANCIALS (21.01%*) 12, i 31, Aberdeen Asset Management 31, Admiral 6, Aviva 95, Barclays 531,108 1, British Land ** 32, Direct Line Insurance 47, Hammerson** 25, Hargreaves Lansdown 7, HSBC 617,768 3, Intu Properties** 30, Land Securities** 25, Legal & General 193, Lloyds Banking 1,750,932 1, London Stock Exchange 7, Old Mutual 158, Prudential 82,661 1, Resolution 43, Royal Bank of Scotland 69, RSA Insurance 31, Schroders 3, St James's Place 16, Standard Chartered 65, Standard Life 77, HEALTH CARE (9.23%*) 5, AstraZeneca 40,880 1, GlaxoSmithKline 157,495 2, Shire 19, Smith & Nephew 29, INDUSTRIALS (7.64%*) 3, Aggreko 7, Ashtead 16, Babcock International 16, BAE Systems 102, Bunzl 10, Capita 21, CRH 23, Experian 32, G4S 50, IMI 8, Intertek 5, Meggitt 26, Rolls-Royce 'C' Shares 60, Rolls-Royce Preference Shares 5,472, Royal Mail 20, Smiths 12, Travis Perkins 7, Weir 6, Wolseley 8,

13 Portfolio Statement as at 30 November 2014 (Ordinary shares except where otherwise stated) Holdings Market Value '000 Percentage of total net assets % OIL & GAS (16.93%*) 8, BG 110,250 1, BP 597,852 2, Petrofac 8, Royal Dutch Shell 'A' Shares 127,505 2, Royal Dutch Shell 'B' Shares 79,451 1, Tullow Oil 29, TECHNOLOGY (1.01%*) ARM 45, Sage 34, TELECOMMUNICATIONS (4.97%*) 3, BT 263,176 1, Vodafone 860,611 2, UTILITIES (4.31%*) 2, Centrica 163, National Grid 122,194 1, Severn Trent 7, SSE 31, United Utilities 22, DERIVATIVES (0.01%*) FTSE 100 Index Linked Futures December Portfolio of investments 54, Net other assets 1, Total net assets 56, All securities are approved securities traded on eligible securities markets, as defined by the Collective Investment Scheme sourcebook, unless otherwise stated. * Comparative figures shown in brackets relate to 31 May ** Real Estate Investment Trust (REIT). 12

14 Statement of Total Return for the period ended 30 November 2014 (unaudited): 01/06/14 to 30/11/14 01/06/13 to 30/11/13 '000 '000 '000 '000 Income Net capital (losses)/gains (1,312) 644 Revenue Expenses (125) (127) Finance costs: Interest - - Net revenue before taxation Taxation (2) 8 Net revenue after taxation Total return before equalisation (490) 1,499 Finance costs: Equalisation 3 - Change in net assets attributable to unitholders from investment activities (487) 1,499 Statement of Change in Net Assets Attributable to Unitholders for the period ended 30 November 2014 (unaudited): 01/06/14 to 30/11/14 01/06/13 to 30/11/13 '000 '000 '000 '000 Opening net assets attributable to unitholders 56,408 55,861 Amounts receivable on issue of units 4,389 2,548 Amounts payable on cancellation of units (4,040) (3,404) 349 (856) Stamp duty reserve tax - (10) Change in net assets attributable to unitholders from investment activities (487) 1,499 Closing net assets attributable to unitholders 56,270 56,494 Comparative information is provided for the Statement of Change in Net Assets Attributable to Shareholders. Since this information is for the prior interim period, the net assets at the end of that period do not correspond to the net assets at the start of the current period. 13

15 Balance Sheet as at 30 November 2014 (unaudited): 30/11/ /05/2014 '000 '000 '000 '000 Assets Investment assets 54,932 55,725 Debtors Cash and bank balances 1,126 2,138 Total other assets 1,407 2,478 Total assets 56,339 58,203 Liabilities Creditors Distribution payable on income units - 1,737 Total liabilities 69 1,795 Net assets attributable to unitholders 56,270 56,408 Accounting Policies The financial statements have been prepared under the historial cost convention, as modified by the revaluation of investments, and in accordance with the Statement of Recommended Practice (SORP) for Financial Statements of Authorised Funds issued by the IA in October 2010 (IA SORP 2010). 14

16 Additional Information Trust Deed: The Fund was established by a Trust Deed made between the Manager and the Trustee dated 6th July 1995 and amended by Supplemental Trust Deeds dated 1 July 1999, 9 July 1999, 19 July 2002, 14 February 2003 and 19 August Prospectus: Copies of the Fund s Prospectus are available free of charge from the Manager upon request, and from our website, Unit type: The Fund issues income units only. Investors can elect at any time to have any income either paid out or automatically reinvested to purchase units at no initial charge. Pricing and dealing: A buying price (the price at which you have bought the units in the Fund and being the higher) and a selling price (the price at which you can sell the units back to the Manager and being the lower) are always quoted for the Fund. The buying price includes the Manager s initial charge. Dealing in all unit trusts operated by Liontrust Fund Partners LLP may be carried out between and hours on any business day. Professional investors and advisers may buy and sell units over the telephone; private investors are required to instruct the Manager in writing for initial purchases, but can deal over the telephone thereafter. Prices are quoted on a forward basis. This means that all deals are based on a price that is calculated at the next valuation point (which is hours on each business day) following receipt of instructions. Instructions received before hours will be priced at hours that day, whilst those deals taken later in the day will receive the next dealing price which is fixed at hours on the following business day. In the case of large deals of 15,000 and over, the Manager has the discretion to quote a special price within limits laid down under the Regulations. The minimum initial lump sum investment in the Fund is 1,000, the minimum additional investment is 1,000 and the amount you may sell back to the Manager at any one time is 500, providing you maintain a balance of 2,500. At its absolute discretion, the Manager may accept a lower minimum amount for the purchase and sale of units. A contract note in respect of any purchase will be issued the day following the dealing date. Unit certificates will not be issued. Instructions to sell your units may be required to be given by telephone and then confirmed in writing to Liontrust Customer Services Team, PO Box 11061, Chelmsford CM99 2YA. A contract note confirming the instruction to sell will be issued the day following the dealing day. Following receipt of a correctly completed Form of Renunciation, a cheque in settlement will be sent directly to you or your bank/building society, if proof of ownership of the account has been received by us, in four business days. Liontrust does not make or accept payments to or from third parties unauthorised by the Financial Conduct Authority. Management charges, spreads and yields: The initial charge and annual management fees per unit class are detailed below. The difference between the bid and the offer prices is currently 6% which includes the initial charge. Included within the OCF is the Annual Initial Charge % Ongoing charges figure* % Management Charge** % Retail class - Retail class 0.46 Retail class *The OCF covers all aspects of operating a fund during the course of its financial year. These include the annual charge for managing the Fund, administration and independent oversight functions, such as trustee, depositary, custody, legal and audit fees. The OCF excludes portfolio transaction costs except for an entry/exit charge paid by the Fund when buying or selling units in another fund. This will have an impact on the realisable value of the investment particularly in the short-term. ** These are the annual costs of running and managing the Fund. The net estimated yields on the classes are shown below, these are calculated and published daily. Yield Retail class % 3.13 Certain other expenses are met by the Fund, all of which are detailed in the Prospectus. Commission: Commission is payable to authorised intermediaries on purchases of units in the Fund at a rate of up to 3%. A discount is available when switching between Liontrust s range of unit trusts. Publication of prices: The price of units in the Fund is quoted on our website, other industry websites such as and the website of the Investment Association (the industry trade body), Daily and historic Fund prices are available from our Dealing and Administration team on Stamp Duty Reserve Tax: Up until 31 March 2014 a Stamp Duty Reserve Tax ( SDRT ) of 0.5% tax was payable by the Trustee of a unit trust when unitholders sell their units in that unit trust. This may have had an effect on you as the unitholder depending on how the unit trust manager treats this particular charge. Up until 31 March 2014 any SDRT liability incurred by the Trustee on Liontrust FTSE 100 Tracker Fund has been charged to the Fund, which could mean that less of your money was be invested for potential capital and income growth. 15

17 Additional Information Capital Gains Tax: As an authorised unit trust, the Fund is exempt from UK Capital Gains Tax. An individual s first 11,000 of net gains on disposals in the tax year are exempt from tax. Income Tax: UK tax resident individuals are entitled to tax credits in respect of dividend distributions received and are subject to income tax on the aggregate of the distribution and the tax credit. In the case of a distribution the current value of the tax credit is equal to one ninth of the net dividend received and the distribution plus tax credits are treated as the top slice of an individual s income. UK resident individuals who are not liable to tax are not able to reclaim the tax credits from the HM Revenue and Customs. In the case of UK resident individuals who are liable to starting or basic rate tax only, the tax credit will match his or her liability on the distribution and there will be no further tax to pay and no right to claim repayments from the HM Revenue and Customs. In the case of a higher rate tax payer, the tax credit will be set against, but not fully match, his or her tax liability on the distribution. Such people will have an additional tax liability to pay. Corporate Unitholders: Ordinary dividends distributed by the Fund to corporate unitholders will be treated as part-franked investment income and part unfranked investment income, in the corporate unitholders hands. The precise split will be calculated by the Manager and will be detailed on the distribution vouchers accompanying the distribution. For unitholders chargeable to UK corporation tax, income allocations representing the UK dividends received by the Fund will not be subject to corporation tax in the unitholders hands. Income allocations representing other types of income received by the Fund will be taxable as if they were annual payments received after the deduction of tax at the rate of 20 per cent of the gross distribution. Important information: It is important to remember that the price of units, and the income from them, can fall as well as rise and is not guaranteed and that investors may not get back the amount originally invested. Past performance is not a guide to future performance. The issue of units may be subject to an initial charge and this is likely to have an impact on the realisable value of your investment, particularly in the short term. You should always regard unit trust investment as long term. The annual management fee of the Fund is deducted from capital. Whilst this results in the dividend paid to investors being higher than would be the case were the annual management fee charged to income, the potential for capital growth may be reduced. Liontrust Fund Partners LLP is authorised and regulated by the Financial Conduct Authority. Liontrust Customer Services Team PO Box 11061, Chelmsford, CM99 2YA Tel Facsimile [email protected] Website: 16