United Global IPO Fundinternetfileserver.phillip.com.sg/Poems/UnitTrust/... · UOB Asset Management Ltd Registered Address: 80 Raffles Place UOB Plaza Singapore 048624 Company Registration

United Global IPO FundSemi Annual Report

for the period 1st January to 30th June 2014

United Global IPO Fund(Constituted under a Trust Deed in the Republic of Singapore)

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MANAGERUOB Asset Management LtdRegistered Address:80 Raffles PlaceUOB PlazaSingapore 048624Company Registration No. : 198600120Z

OPERATIONS ADDRESS80 Raffles Place#06-00, UOB Plaza 2Singapore 048624Tel: 1800 22 22 228

DIRECTORS OF UOB ASSET MANAGEMENTTerence Ong Sea EngCheo Chai HongThio Boon Kiat

TRUSTEE / REGISTRARHSBC Institutional Trust Services (Singapore) Limited21 Collyer Quay#10-02, HSBC BuildingSingapore 049320

CUSTODIANState Street Bank and Trust CompanyOne Lincoln StreetBoston, MA 02111United States of America

AUDITORSPricewaterhouseCoopers LLP8 Cross Street#17-00, PWC BuildingSingapore 048424

SOLICITORS TO THE MANAGERTan Peng Chin LLC30 Raffles Place#11-00, Chevron HouseSingapore 048622

SOLICITORS TO THE TRUSTEEAllen & Gledhill LLPOne Marina Boulevard#28-00Singapore 018989


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A) Fund Performance

Fund Performance/ Benchmark Returns

3 mth

% Growth

6 mth

% Growth

1 yr

% Growth

3 yr Ann

Comp Ret

5 yr Ann

Comp Ret

10 yr Ann

Comp Ret

Since Inception

6 December 2004 Ann

Comp Ret

United Global IPO Fund -0.23 -3.28 2.08 -5.44 0.00 N/A -0.80

Benchmark 1.46 2.93 6.00 6.00 6.00 N/A 6.00

Source: Lipper, a Thomson Reuters Company.

Note: The performance returns of the Fund are in Singapore dollars based on a NAV-to-NAV basis with dividends reinvested. The benchmark of the Fund: The Performance of the Fund will be measured against an absolute return benchmark of 6% per annum.

For the first six months ended 30 June 2014, the net asset value of the Fund declined 3.3%, compared to an absolute return benchmark of 2.9% in SGD terms.

On an absolute basis, the underperformance is largely due to the Fund’s regional tilt towards consumer stocks within Asia ex-Japan. The sector suffered from a slowdown in consumption as a result of China’s slowing economy. This was partially offset by the Fund’s exposure to the energy sector which was one of the best performing sectors year to date. The investment focus remains on bottom-up stock selection where we look for opportunities in a few key areas that offer strong secular medium to long term drivers.

A positive consumption trend in emerging markets is still one of the themes that we favour. As per capita income levels rise, consumer behaviour shifts, creating sustainable growth opportunities. A proxy to the rising consumption story could also be via merchant acquirers which the Fund has benefited from, such as Cielo which is the dominant card processing company in Brazil.

Another major trend that we favour is the rapid urbanization in the developing world which, in turn, has fuelled demand for infrastructure developments and resources. In particular, demand for fossil fuel continues to be strong mainly driven by emerging market consumers. The Fund benefited from Meg Energy, an exploration and production (“E&P”) company in Canada with strong operational efficiencies and high quality assets.

Some of the detractors from performance included Macau gaming stocks such as Wynn Macau and Sands China which were sold down as gross gaming revenues declined. However, we believe the sector is oversold as a result of weak sentiment and we would be keen to add to our positions.

As at 30 June 2014, the Fund had the following regional asset allocation:

Hong Kong / China (21.8%), United States (14.7%), Canada (18.4%), the UK (10.3%), Brazil (10.7%), the Philippines (6.8%), Others (5.5%) and the remainder in cash (11.8%).


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Economic and Market Review

Global equities ended the first half of the year strongly as economic data continued to strengthen in the second quarter after a weak start due to extreme cold weather. Leading economic indicators for most major countries continued to improve as the US recovery broadened out to the rest of the world. Purchasing managers’ indices (PMIs) in various developed regions remained in expansionary mode with the exception of France, which dipped back into contraction. Europe lagged the broader index as growth started to roll over in the latter half of the review period. Deflationary risks remained a concern in Europe despite the European Central Bank (ECB) introducing more easing measures. Japan was the only market which turned in negative returns as investors remain sceptical of Abenomic’s “Third Arrow” economic policy amidst the implementation of a consumption tax (VAT) hike in April. Central banks globally remained dovish keeping monetary policies loose.

The level of IPO activity in the period under review improved from the previous year. There were a total of 547 IPO listings globally raising approximately $125 billion. This represents an increase of +8.1% in the number of IPOs year over year but is flat in terms of total value raised.

Overall, the global market rally was led by the US market which rose 4.7% against the MSCI AC World Index which advanced by 3.6%. MSCI Emerging Markets also gained 3.5% while MSCI Japan came in with negative returns of 1.5%. Emerging market stocks were boosted by specific country performances such as MSCI India and MSCI Indonesia which rose 19.4% and 18.2% respectively.

Given the volatility of the global equities market, the Fund held a higher than average cash position during the period. The higher cash level enabled the Fund to be more opportunistic in picking oversold stocks at attractive valuations. The strategy of staying nimble allowed the Fund to position for a rebound, while protecting the Fund from downside.

Outlook and Fund Strategy

We remain positive on global equities as the continued recovery in global economic growth should see risk assets outperform other asset classes. Benign inflation across the developed markets and dovish policies from global central banks create a positive backdrop for equities. Global growth however remains uneven with various regions at different stages of the business cycle. Hence differentiation across sectors and regions would be crucial for Fund performance.

On the global IPO market, the pipeline of companies looking to list remains strong. Notwithstanding this, investors have also become more selective. Quality companies continued to be several times oversubscribed while lower quality companies were largely ignored. We remain selective in our participation and believe that fundamental bottom-up analysis remains key to Fund outperformance. In the near term, we continue to look to increase our exposure towards developed markets over emerging markets given the cyclical change in the investment landscape. However, we continue to be constructive on the emerging markets as the region offers attractive opportunities arising from positive structural trends such as growing consumption and increasing urbanization. We look to add to positions on opportunistic dips for high quality companies.

We believe that the Fund is well-positioned to deliver favourable returns through our disciplined approach of investing in quality franchises at reasonable valuations. In the current volatile environment, we also see opportunities to add undervalued stocks.


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B) Investments at fair value and as a percentage of NAV as at 30 June 2014 under review classified by

Fair Value % of NAV (S$)

i) Country

Brazil 1,073,948 10.72Canada 1,837,200 18.35 Hong Kong 2,186,574 21.85 Indonesia 373,346 3.73 Philippines 675,718 6.75 Singapore 180,180 1.80 United Kingdom 1,027,472 10.26 United States 1,476,371 14.75

Portfolio of investments 8,830,809 88.21 Other net assets 1,179,827 11.79

Total 10,010,636 100.00

ii) Industry

Consumer Discretionary 2,269,615 22.67Consumer Staples 756,799 7.56Energy 3,965,828 39.61Financials 893,718 8.93Information Technology 772,051 7.71Materials 172,798 1.73


Total 10,010,636 100.00

iii) Asset Class

Equities 8,830,809 88.21Other net assets 1,179,827 11.79

Total 10,010,636 100.00

iv) Credit rating of debt securities

N/A


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C) Top Ten Holdings

The top 10 holdings as at 30 June 2014 and 30 June 2013

10 largest holdings at 30 June 2014 Percentage of total net assets attributable to Fair Value unitholders (S$) %

CIELO SA 772,051 7.71SANDS CHINA LTD 753,425 7.53WYNN MACAU LTD 655,242 6.55AIA GROUP LTD 601,453 6.01LAREDO PETROLEUM INC 463,455 4.63COBALT INTERNATIONAL ENERGY INC 457,521 4.57AFRICA OIL CORPORATION 450,896 4.50PUREGOLD PRICE CLUB INC 400,362 4.00GNC HOLDINGS INC-CL A 382,597 3.82GENEL ENERGY PLC 367,805 3.67

10 largest holdings at 30 June 2013 Percentage of total net assets attributable to Fair Value unitholders (S$) %

COBALT INTERNATIONAL ENERGY INC 725,068 6.63CIELO SA 616,211 5.63AIA GROUP LTD 608,351 5.56AFRICA OIL CORPORATION 591,922 5.41BELLE INTERNATIONAL HOLDINGS LIMITED 583,938 5.34SANDS CHINA LTD 580,128 5.30MEG ENERGY CORPORATION -W/I 573,169 5.24WYNN MACAU LTD 563,155 5.15COSCO CAPITAL INC 502,850 4.60UNITED STATES BRENT OIL FUND 492,164 4.50

D) Exposure to derivatives

i) fair value of derivative contracts and as a percentage of NAV as at 30 June 2014

N/A

ii) net gains/(losses) on derivative contracts realised during the financial period ended 30 June 2014

N/A

iii) net gains/(losses) on outstanding derivative contracts marked to market as at 30 June 2014

N/A


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E) Amount and percentage of net asset value (NAV) invested in other schemes as at 30 June 2014

N/A

F) Amount and percentage of borrowings to net asset value (NAV) as at 30 June 2014

N/A

G) Amount of redemptions and subscriptions for the period 01 January 2014 to 30 June 2014

Total amount of redemptions SGD 490,646Total amount of subscriptions SGD 95,488

H) The amount and terms of related-party transactions for the period 01 January 2014 to 30 June 2014

i) As at 30 June 2014 the Fund maintained current accounts with the United Overseas Bank Limited as follows:

Bank balances SGD 1,822

ii) Purchase/holdings of UOBAM unit trusts by UOB or its affiliated companies as at 30 June 2014

Holdings of United Global IPO Fund as at 30 June 2014 were as follows:

Affiliated Companies No. of Units Unit Price Market Value SGD SGD

a) Union - Offshore Insurance Fund 161,429.14 0.885 142,864.79

iii) Investment in Initial Public Offerings managed by UOB Group.

N/A

iv) As at 30 June 2014 there was no brokerage income earned by UOB Kay Hian Pte Ltd.


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I) Expense ratios

30 June 2014 2.33%30 June 2013 2.18%

Note: The expense ratio has been computed based on the guidelines laid down by the Investment Management Association of Singapore (“IMAS”). The calculation of the expense ratio at 30 June 2014 was based on total operating expenses of $ 251,509 (2013: $295,108) divided by the average net asset value of $10,775,764 (2013: $13,527,832) for the year. The total operating expenses do not include (where applicable) brokerage and other transactions costs, performance fee, interest expense, distribution paid out to unitholders, foreign exchange gains/losses, front or back end loads arising from the purchase or sale of other funds and tax deducted at source or arising out of income received. The Fund has not paid any performance fee during the year. The average net asset value is based on the daily balances.

J) Turnover ratios

30 June 2014 23.28%30 June 2013 44.02%

Note: The portfolio turnover ratio is calculated in accordance with the formula stated in the Code on Collective Investment Schemes. The calculation of the portfolio turnover ratio was based on the lower of the total value of purchases or sales of the underlying investments, being purchases of $2,405,682 (2013: sales of $5,497,768) divided by the average daily net asset value of $10,334,544 (2013: $12,488,888).

K) Any material information that will adversely impact the valuation of the scheme such as contingent liabilities of open contracts

N/A

L) For schemes which invest more than 30% of their deposited property in another scheme, the following key information on the second-mentioned scheme (“the underlying scheme”)1 should be disclosed as well

i) top 10 holdings at fair value and as percentage of NAV as at 30 June 2014 and 30 June 2013

N/A

ii) expense ratios for the financial period ended 30 June 2014 and 30 June 2013

N/A

iii) turnover ratios for the financial period ended 30 June 2014 and 30 June 2013

N/A

1 where the underlying scheme is managed by a foreign manager which belongs to the same group of companies as, or has a formal arrangement or investment agreement with, the Singapore manager, the above information should be disclosed on the underlying scheme. In other cases, such information on the underlying scheme should be disclosed only if it is readily available to the Singapore manager.


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M) Soft dollar commissions/arrangements

UOB Asset Management has entered into soft dollars arrangements with selected brokers from whom products and services are received from third parties. The products and services relate essentially to computer hardware and software to the extent that they are used to support the investment decision making process, research and advisory services, economic and political analyses, portfolio analyses including performance measurements, market analyses, data and quotation services, all of which are believed to be helpful in the overall discharge of UOB Asset Management’s duties to clients. As such services generally benefit all of UOB Asset Management’s clients in terms of input into the investment decision making process, the soft credits utilised are not allocated on a specific client basis. The Manager confirms that trades were executed on a best execution basis and there was no churning of trades.


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STATEMENT OF TOTAL RETURN For the half year ended 30 June 2014 (Un-audited)

30 June 30 June 2014 2013 $ $ IncomeDividends 101,082 142,079 Interest 1,441 386 102,523 142,465 Less: ExpensesManagement fee 76,827 92,894 Trustee fee 2,480 2,477 Audit fee 8,679 7,835 Registrar fee 7,490 7,490 Valuation fee 6,402 7,741 Custody fee 5,508 6,266 Transaction cost 17,830 48,761 Other expenses 15,685 (5,996) 140,901 167,468

Net loss (38,378) (25,003) Net gains or losses on value of investments Net loss on investments (288,232) (1,602,775)Net foreign exchange loss (8,431) (8,941) (296,663) (1,611,716)

Total deficit for the period before income tax (335,041) (1,636,719)Less: Income tax (3,268) (249) Total deficit for the period (338,309) (1,636,968)


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STATEMENT OF FINANCIAL POSITIONAs at 30 June 2014 (Un-audited)

30 June 31 December 2014 2013 $ $ ASSETS Portfolio of investments 8,830,809 9,819,174 Receivables 2,033 973 Sales awaiting settlement 110,220 - Fixed deposit 1,002,764 1,001,316 Cash and bank balances 421,519 123,980 Total Assets 10,367,345 10,945,443

LIABILITIES Payables 57,607 201,340 Purchases awaiting settlement 299,102 - Total Liabilities 356,709 201,340

EQUITYNet assets attributable to unitholders 10,010,636 10,744,103


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STATEMENT OF MOVEMENTS OF UNITHOLDERS’ FUNDSFor the half year ended 30 June 2014 (Un-audited)

30 June 31 December 2014 2013 $ $

Net assets attributable to unitholders at the beginning of the financial period/year 10,744,103 13,592,453 Operations Change in net assets attributable to unitholders resulting from operations (338,309) (1,011,295)

Unitholders’ contributions/(withdrawals) Creation of units 95,488 160,683 Cancellation of units (490,646) (1,997,738)

Change in net assets attributable to unitholders resulting from net creation and cancellation of units (395,158) (1,837,055)

Total decrease in net assets attributable to unitholders (733,467) (2,848,350)

Net assets attributable to unitholders at the end of the financial period/year 10,010,636 10,744,103


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STATEMENT OF PORTFOLIO As at 30 June 2014 (Un-audited)

Percentage of total net assets attributable to Holdings at Fair value at unitholders at 30 June 30 June 30 June 2014 2014 2014 $ %By Geography - PrimaryQuoted Equities

BRAZIL CIA HERING 24,000 301,897 3.01 CIELO SA 30,000 772,051 7.71 TOTAL BRAZIL 1,073,948 10.72 CANADA AFRICA OIL CORPORATION 52,000 450,896 4.50 AFRICA OIL CORPORATION-PLACEMENT 18,509 158,139 1.58 JOURNEY ENERGY INC 20,000 276,214 2.76 MEG ENERGY CORPORATION -W/I 6,700 304,963 3.05 RAGING RIVER EXPLORATION INC 27,000 342,868 3.42 VERMILION ENERGY INC 3,500 304,120 3.04 TOTAL CANADA 1,837,200 18.35

HONG KONG AIA GROUP LTD 96,000 601,453 6.01 PRADA HOLDING SPA 20,000 176,454 1.76 SANDS CHINA LTD 80,000 753,425 7.53 WYNN MACAU LTD 134,000 655,242 6.55 TOTAL HONG KONG 2,186,574 21.85

INDONESIA PT BEKASI FAJAR INDUSTRIAL ESTATE TBK 6,586,000 292,265 2.92 PT WISMILAK INTI MAKMUR TBK 1,264,000 81,081 0.81 TOTAL INDONESIA 373,346 3.73

PHILIPPINES COSCO CAPITAL INC 996,000 275,356 2.75 PUREGOLD PRICE CLUB INC 323,000 400,362 4.00 TOTAL PHILIPPINES 675,718 6.75


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Percentage of total net assets attributable to Holdings at Fair value at unitholders at 30 June 30 June 30 June 2014 2014 2014 $ %By Geography - Primary (continued)Quoted Equities

SINGAPOREREX INTERNATIONAL HOLDINGS 286,000 180,180 1.80

UNITED KINGDOM GENEL ENERGY PLC 17,000 367,805 3.67 OPHIR ENERGY PLC 65,000 305,232 3.05 TULLOW OIL PLC-ADR 39,000 354,435 3.54 TOTAL UNITED KINGDOM 1,027,472 10.26

UNITED STATES COBALT INTERNATIONAL ENERGY INC 20,000 457,521 4.57 GNC HOLDINGS INC-CL A 9,000 382,597 3.82 LAREDO PETROLEUM INC 12,000 463,455 4.63 MOLYCORP INC 33,000 105,728 1.06 TRONOX LTD-CL A 2,000 67,070 0.67

TOTAL UNITED STATES 1,476,371 14.75


Net assets attributable to unitholders 10,010,636 100.00


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Percentage of Percentage of total net assets total net assets attributable to attributable to unitholders at unitholders at 30 June 31 December 2014 2013 % %By Geography - Primary (Summary)Quoted Equities Brazil 10.72 9.85Canada 18.35 14.32China - 6.05Hong Kong 21.85 22.48Indonesia 3.73 3.65Malaysia - 1.76Philippines 6.75 3.48Singapore 1.80 3.17United Kingdom 10.26 9.81United States 14.75 16.82

Portfolio of investments 88.21 91.39Other net assets 11.79 8.61

Net assets attributable to unitholders 100.00 100.00


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Percentage of Percentage of total net assets total net assets attributable to attributable to Fair value at unitholders at unitholders at 30 June 30 June 31 December 2014 2014 2013 $ % %By Industry - SecondaryQuoted Equities

Consumer Discretionary 2,269,615 22.67 23.90 Consumer Staples 756,799 7.56 2.32 Energy 3,965,828 39.61 41.60 Financials 893,718 8.93 9.53 Industrials - - 1.59 Information Technology 772,051 7.71 6.54 Materials 172,798 1.73 2.72 Unit Trusts - - 3.19

Portfolio of investments 8,830,809 88.21 91.39 Other net assets 1,179,827 11.79 8.61

Net assets attributable to unitholders 10,010,636 100.00 100.00


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United Global IPO Fundinternetfileserver.phillip.com.sg/Poems/UnitTrust/... · UOB Asset Management Ltd Registered Address: 80 Raffles Place UOB Plaza Singapore 048624 Company Registration