Download Financial Report 2005

The First Mazoon Fund JIA
Quarterly Report for the three months ended March 31, 2005 (Unaudited)
Name of the Fund: The First Mazoon Fund
Investment Objective
The Objective of the Fund is to provide investors with the opportunity to
invest in a basket of predominantly blue-chip Omani equities in order to
achieve substantial capital gains.
Investment strategy
The strategy is to identify and invest in the blue chip companies in the
secondary market and achieve an above average return.
Risk Profile
Invest predominantly in blue-chip equities and maintain risk/return profile
similar to the market.
Porfolio Allocation
% of Net assets as on March 31, 2005
Value
% of net asssets
Banking
619,994
17.3%
Investment
748,126
20.8%
Services
697,416
19.4%
Industrial
Insurance
Government bonds
535,976
-
Foreign investment
-
14.9%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
Banking
Investment
Services
Industrial
Insurance
Bonds and other debt instruments
168,900
4.7%
0.0%
Cash
216,797
6.0%
Trust Account holding
133,289
3.7%
GCC Investments
Term deposits
Other assets/(liabilities)
400,710
69,044
11.2%
0.0%
1.9%
3,590,252
100.0%
Net Assets
Portfolio Highlights at March 31, 2005
Ten Largest Holdings
Issue
Shares
Rials Omani
RO
Percentage of
Net Assets
Bank Muscat
42,462
369,844
10.3%
Oman Cement
58,200
355,020
9.9%
Ominvest
47,056
272,925
7.6%
169,763
271,621
7.6%
25,035
224,063
6.2%
Topaz
100,100
215,215
6.0%
DIDIC
52,200
203,580
5.7%
Al Khaleej Poly Propylene
48,255
180,956
5.0%
Oman International Bank
45,000
174,150
4.9%
128,105
156,288
4.4%
2,423,662
67.6%
Al Madina Financial &
Investment Services
Renaissance Services
United Power
Five Largest Net Security Purchases
during the quarter ended March 31, 2005
Qty
Proceeds in RO
No purchases were made during the quarter ended March 31, 2005
Five Largest Net Security Sales
during the quarter ended March 31, 2005
Qty
Proceeds in RO
Shell Oman
20,000
117,528
Oman International Bank
20,000
73,704
Raysut Cement
10,000
59,268
United Power
20,000
23,605
Al Maha
4,600
22,358
Performance Data:
6.8%
Growth of an
Assumed
Investment of
RO 10,000
10,680
7.8%
10,776
3 months
ended
31-Mar-05
3 months
ended
31-Mar-04
12 months
ended
31-Dec-04
Net Assets
3,590,252
2,661,758
2,994,588
Number of Outstanding Units
2,209,468
2,894,689
2,263,732
1.625
0.920
1.323
22.1%
6.0%
27.9%
Expense Ratio: *
(Expenses to average NAV)
0.7%
3.7%
3.2%
Portfolio Turnover Rate: +
6.0%
6.0%
27.6%
0.5%
8.5%
1.1%
Average Annual
Total Return (*)
3 months ended March 31, 2005
June 97 to March 31, 2005 (94
months)
(*)
(*) 5% cash dividend for 1997 added back
Units Outstanding, Net Asset Value (NAV), and Ratios:
Net Asset Value (NAV)
PER UNIT RATIOS
Simple Return: +
(After tax profit to beginning
NAV)
(Securities traded to average
NAV)
Liability Ratio:
(Liabilities to NAV)
* Annualised
+
Not annualised
Fund Per-Unit Table
3 months
ended
31-Mar-05
3 months
ended
31-Mar-04
12 months
ended
31-Dec-04
PER-UNIT CHANGES IN NAV
(Net Asset Value)
Investment Income
0.00053
0.00352
0.07892
Net gain / (loss) on investments
available for sale
0.30952
0.05747
0.27156
Interest Expenses
All Management and Other
Expenses
Taxation
Net After Tax Profit (Loss)
Cash Dividends Paid
Net Increase (Decrease) in NAV
-
0.01087
-
0.29917
-
0.29917
-
0.00827
-
0.05272
-
0.05272
-
0.03917
-
0.31131
-
0.31131
Gain in redemption of units
0.003
-
0.146
NAV at Beginning of Period
1.323
0.866
0.866
NAV at End of Period
1.625
0.920
1.323
0.00241
0.00043
0.002
*Brokerage Commissions and
markups
Unaudited profit and loss account
For the 3 months ended 31 March 2005 and 2004
Notes
3 months
ended
31-Mar-05
RO
3 months
ended
31-Mar-04
RO
12 months
ended
31-Dec-04
RO
Dividends
1,160
9,074
177,248
Interest income (debt
instruments)
-
213
520
Other Income
-
894
894
683,872
166,365
614,733
685,032
176,546
793,395
Management fee
11,354
9,266
40,763
Custodian fee
Amortisation expenses
1,622
-
1,324
-
5,823
-
Auditing and Legal fees
675
2,225
5,901
Directors’ fees and expenses
600
800
3,400
6,462
3,308
10,311
-
32,795
-
Total Expenses
24,022
23,926
88,682
Profit before taxation
661,011
152,620
704,713
Taxation
-
-
-
Net Profit after tax
661,011
152,620
704,713
-
-
Income & Gains:
Investment Income:
Net gain/(loss) on investments
available for sale
1
Total Income & Gains
Expenses:
Interest Expenses
Management and other expenses:
Other fees and expenses
Currency Loss
Dividend per unit
4&6
4
-
Unaudited consolidated balance sheet
at 31 March 2005
Notes
31-Mar-05
RO
Assets
Intangible assets
Investments available for sale
Bank balances and cash
Receivable/prepaid
Dividends receivable
Other assets
Total Assets
3,7 & 8
5
Balance Sheet as at
31-Mar-04
RO
31-Dec-04
RO
-
-
-
3,304,411
2,683,291
2,895,983
216,797
192,133
8,377
85,619
-
11,741
-
124,032
-
3,606,827
2,887,165
3,028,392
Liabilities
Bank loans and overdrafts
Payable for securities purchased
211,216
Payable for capital units
repurchased
Accrued expenses:
Management fee & other exp
Dividend payable
Other liabilities
16,575
-
10,589
3,601
33,804
-
16,575
225,406
33,804
3,590,252
2,661,759
2,994,588
Unit-holders’ funds
3,590,252
2,661,759
2,994,588
Unit capital, at RO 1 par value
2,209,468
2,894,689
2,263,732
3,590,252
2,661,759
2,994,588
1.625
0.920
1.323
Total Liabilities
Net Assets
(Authorized 10330204 Units,
Outstanding Units 2209468
Additional paid-in capital
Legal reserve/Taxation
Profit and loss account
Net Assets
Net Asset Value per Outstanding
Unit
(Net Assets ÷ no units
outstanding)
Unaudited statement of cash flow for the 3 months period ended 31 March 2005 & 2004
3 months
ended
31-Mar-05
3 months
ended
31-Mar-04
12 months
ended
31-Dec-04
661,011
152,620
704,713
Operating Activities
Net profit (loss) before taxation
Adjustments for:
Interest Income
Amortization of Est expense
Net unrealised gain on
investments
Net unrealised loss on
investments
Interest expense
Operating profit(Loss) before
working capital changes
-
-
-
-
-
-
-
-
-
661,011
152,620
704,713
(408,428)
(430,301)
(642,994)
38,413
(1,216)
(113,507)
(17,229)
157,327
(34,275)
273,767
(121,570)
(86,063)
273,767
(121,570)
(86,063)
-
270,000
322,856
-
270,000
322,856
-
-
-
Redemption of units
(65,347)
(14,245)
(233,509)
Net cash used in financing
activities
(65,347)
(14,245)
(233,509)
DECREASE IN CASH AND
CASH EQUIVALENTS
208,420
134,184
3,284
Cash and cash equivalents at the
beginning of the year
8,377
5,093
5,093
Cash and cash equivalents at the
end of the period
216,797
139,277
8,377
decrease in investment
decrease in accounts receivable
and prepayments
Decrease in accounts payable and
accruals
Cash used in operations
interest paid
Net cash from operation
activities
Investing activities
Decrease in bank deposits
Interest Income
Net cash (used in) from investing
activities
FINANCING ACTIVITIES
Dividends paid
The First Mazoon Fund JIA
Report for the I Quarter ended March 2005
P O Box 974, Ruwi, Postal Code 112, Oman – Tel: +968 24790614 Fax: +968 24790612
Objective
.
.
The Fund provides investors with the opportunity to invest
in a basket of predominantly blue-chip Omani equities in
order to achieve substantial capital gains.
Performance
FMF *
Year to Date
22.8%
1 year
53.6%
3 year
126.4%
5 year
127.2%
Since inception+
41.3%
* The First Mazoon Fund JIA
.
MSM 30 Index
26.7%
44.5%
158.0%
75.0%
13.3%
Fund Details
Manager
Intl. Investment Advisor
Custodian
Launch Date
Auditor
Current Size
Units outstanding
Type
Listing
Subscription/redemption
Dealing date
Management fee
NAV/Unit
Market Price
Last Dealing price/unit
.
:
:
:
:
:
:
:
:
:
:
:
:
:
:
:
Gulf Investment Services Co SAOG
HSBC Financial Services (ME) Ltd.
HSBC Bank Middle East, Oman
June 10, 1997
KPMG
RO 3.59 million
2,209,468
Semi Open-ended
Muscat Securities Market (MSM)
Monthly
Second Thursday of each month
1.4% per annum
RO 1.625
RO 1.880
Bid: RO 1.320 offer: RO 1.373
FMF NAV Vs MSM Index from inception to 31-03-05
P
E
R
F
O
R
M
A
N
C
E
Base = 100
Market Review and Outlook
.
Record breaking oil prices continued to drive the underlying
economic fundamentals keeping markets buoyant. The
Sultanate has announced that the official price for Omani Crude
for March’05 was at US$ 47.5 per barrel the highest since the
Sultanate started the production of crude. The first quarter of
2005 for the stock market has been the best so far in the current
decade with the index appreciating 27 per cent since the
beginning of the year. Similar to last year the industry sector
index led the rally on a gain of 33 per cent followed by the
banking and investment sector on increase of 27 per cent while
the service sector recorded a gain of 19 per cent. The up move
in the current quarter was also driven by volumes from GCC
bigwigs who consider Oman to be cheaper than other GCC
markets. Broad Money supply in January 2005 increased 3 per
cent whereas the increase in February 2005 was 2.7 per cent
(month on month). The surge in liquidity increased the activity
and volumes in the market. The forthcoming OMANTEL IPO
is likely to substantially improve the market capitalization,
depth, breadth and liquidity in the market attracting foreign and
GCC investment. The current lofty oil prices and amass
liquidity is expected to keep the market buoyant in the coming
year.
Fund Review
.
The Investors' Committee at its meeting held on March 09
proposed a cash dividend of 14% and a stock dividend of 14%
for FY 2004. Investors responded positively and the fund's
units moved from RO 1.220 to an all time high of RO
2.000. The NAV was RO 1.625 at the end of the quarter and
was up 22.8% on YTD basis as against the market's gain of
26.7%. The GCC portfolio made impressive gains of over
17.4% for the quarter. Profits were skimmed in most markets
and the Fund continues to be overweight in Kuwait. The
average NAV during the quarter was RO 1.440 at an average
discount of 6.8%. The total number of units redeemed during
the quarter was 54,264.
TOP 5 Holdings
%
.
Bank Muscat
10.30
Oman Cement
9.89
Ominvest
7.60
Al Madina Fin & Invest Co
7.57
Renaissance Services
6.24
52-week
High
Low
4390.91
2952.03
MSM 30.Index*
RO 2.000
RO 0.740
Market Price+
RO 1.642
RO 0.913
NAV per Unit
*Rebased to 1000 on June 01, 2004
+ Adjusted for 15% Capital reduction w.e.f. May 1,2004
Contact information:
Bharath Rajnarayan – Fund Manager
Email: [email protected] Tel: +968 2479-0614 Ext – 119
180
200
140
150
100
100
60
50
20
0
8
9
0
1
2
3
4
5
Mar-9 Mar-9 Mar-0 Mar-0 Mar-0 Mar-0 Mar-0 Mar-0
MSM
FMF
S ECTORAL ALLOCATION
6.03%
A
S
S
E
T
S
1.92%
4.70%
40.02%
16.93%
30.40%
Bank&Inv.
Serv.
Ind.
Bond
FD&Cash
Oth.Assets
GEO GRAPHICAL DISTRIBUTIO N
A
L
L
O
C
A
T
I
O
N
3.29%
1.88%
0.78%
5.28%
88.76%
OMAN
KUWAIT
SAUDI
UAE
T
TH
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RSST
TM
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ZO
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ME
EN
NT
TA
AC
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CO
OU
UN
NT
T
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22,,552233,,338844
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((223333,,550099))
-------------------------
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22,,999944,,558888
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-----------------------33,,559900,,225522
==================
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------------------------22,,666611,,775588
==================
1. After initial recognition, investments which are classified "available for sale" are remeasured at fair value.
Any gain or loss arising from a change in fair value is included in the statement of income in the period in
which it arises.
2. Definition of Ratios
NAV = Net Asset Value = The equity value of one unit of the Investment Fund. Calculated by subtracting the
liabilities per unit from the assets per unit. Or, by dividing the Net Assets by the number of Outstanding Units.
(For close end funs only) The market price at which units trade may be higher or lower than the Net Asset
Value.
Average Annual Total Return* = Average annual compounded rate of return, calculated on the assumption that
all dividends have been reinvested at the time they were distributed. Average Annual Total Return is based on
the Net Asset Value at the time of purchase, and does not reflect payment of initial sales charges. Average
Annual total return is mathematically defined as follows: (give definition)
Simple Return = Calculated by dividing the per unit after tax profit for the period, by the NAV at the beginning
of the period. Or, calculated by dividing the sum of the per unit dividends and change in the net asset value
during the period, by the NAV at the beginning of the period. (Adjust this definition if necessary to fairly
reflect return, where there have been distributions or repurchases of units at a value different from net asset
value.
Expense Ratio = Per unit, expenses during the period (Interest Expenses + All Management and Other
Expenses (except for brokerage commissions and mark ups)), divided by Average NAV for the period.
Brokerage Expense Ratio= Per Unit, brokerage commissions and mark ups during the period (Brokerage
Commissions + Mark-ups), divided by Average NAV for the period
Portfolio Turnover Rate = Per unit, average of the price of assets bought and the price of the assets sold
((Purchases + Sales) ÷ 2), during the period, divided by Average NAV for the period.
Liability Ratio = Per unit, liabilities at the end of the period, divided by the NAV at the end of the period.
(For Closed-end Funds only) Average Annual Total Return, and Simple Return are based on the dividends paid
to unit-holders, and the growth in the Net Asset Value during the period. These Ratios are not based on, or
affected by, the price at which the units were purchased in the market, or the price for which units may be sold
in the market.
3. Investments available for sale
After initial recognition, investments which are classified "available for sale" are remeasured at fair value. Any
gain or loss arising from a change in fair value is included in the statement of income in the period in which it
arises.
Investments can be analysed as follows:
31-Mar-05
Market value
RO’
31-Mar-04
Market value
RO’
31-Mar-05
Cost **
RO’
Percentage
of Net
Assets
Banking
619,994
554,265
486,757
17.3%
Investment
748,126
487,475
632,377
20.8%
Services
697,416
796,145
517,721
19.4%
Industrial
535,976
193,690
419,355
14.9%
2,601,513
2,031,575
2,056,210
72.5%
Marketable securities - MSM
Marketable securities – Foreign
by Sector
Total
Unquoted and other investments
Unquoted Omani shares
Bonds & Trust Accounts
400,710
-
318,118
11.2%
400,710
-
318,118
11.2%
-
-
-
0.0%
302,188
651,716
298,857
8.4%
302,188
651,716
298,857
8.4%
Total Investments
3,304,411
2,683,291
2,673,185
92.0%
3 months
ended
31-Mar-05
RO
3 months
ended
31-Mar-04
RO
12 months
ended
31-Dec-04
RO
Bank Charges
1,265
1,631
6,021
Insurance
3,751
5,966
18,414
MSM Regulatory fee
558
826
3,021
Other Expenses (including
Publication, printing & stationery
etc)
888
1,888
5,339
6,462
10,311
32,795
Bank Balances and cash
Time Deposit
216,797
-
139,277
52,856
8,377
-
Total
216,797
192,133
8,377
4. Other fees and expenses
Other fees and expenses total
5. Cash and cash equivalents
6. Related Parties, and Holders of 10% Ownership Interests
Holders of 10% Ownership Interests of the Investment Manager or the Fund may include companies,
individuals, or families. Families are included if the shares or units of the family members total 10% or more of
the Investment Manager’s or Fund’s shares or The nature of significant transactions involving related parties
of the Investment Manager or the Fund, or holders of10% or more ownership interest in the Investment
Manager or Fund, or their family members, and the amounts involved during the period were as follows:
3 months
ended
31-Mar-05
3 months
ended
31-Mar-04
12 months
ended
31-Dec-04
RO
RO
RO
1,212
-
1,236
-
4,796
-
1,212
1,236
4,796
Brokerage Commission and
Mark-ups
Broker- Gulf investment Services
Co
Interest income from HSBC
Total
* Brokerage commissions and mark-ups paid to related parties and 10% holders are included in the cost of
investments purchased and sold. As a result, all commissions and markups are included within Net Investment
Gains or Losses.
Expense Items
Items of expense which were paid to related parties of the Investment Manager or the Fund, or holders of
10% or more ownership interest in the Investment Manager or Fund, or their family members, during the
period can be further analysed as follows:
3 months
3 months
12 months
ended
ended
ended
31-Mar-05
31-Mar-04
31-Dec-04
RO
RO
RO
Management fee- GIS
9,246
7,546
33,193
Management fee- HSBC
2,109
1,721
7,570
Custodian fee - HSBC
1,622
1,324
5,823
Bank Charges-HSBC
1,265
1,631
6,020
Total
14,241
12,222
52,606
7. Investments, Purchases & Sales of Securities of Related & Connected Issuers
NIL
8. Details of Significant Investments
Details of all the reporting fund’s investments, for which either, the reporting fund’s holding represents
10%ormore of the issuer’s sharecapital, or, the reporting fund’s holding exceeds 5% of the market value of
the reporting fund’s investment
portfolio.
% of total market
Value
Cost
% of net
value of the
Funds' portfolio
Qty
RO’
RO’ assets
Bank Muscat
13.3%
42,462
369,844
271,757 10.3%
Oman Cement
12.8%
58,200
355,020
271,212 9.9%
9.9%
47,056
272,925
195,282 7.6%
MSM Quoted securities
Ominvest
Al Madina Fin & Inv Services
9.8%
169,763
271,621
271,621 7.6%
Renaissance Services
8.1%
25,035
224,063
147,707 6.2%
Topaz
7.8%
100,100
215,215
187,187 6.0%
Dhofar Intl. Dev. & Inv.
7.3%
52,200
203,580
165,474 5.7%
Al Khaleej Polypropylene
6.5%
48,255
180,956
148,143 5.0%
Oman Internationbal Bank
6.3%
45,000
174,150
153,000 4.9%
United Power
5.6%
128,105
156,288
106,327 4.4%
87.5%
2,423,662
9. Unit-holders
All those Unit-holders of the company who own 10% or more of the fund’s units, whether
in
their name, orthrough a nominee account,and the number of units they hold are as follows:
(Authorized 10330204 Units,
Outstanding Units 2209468
31-Mar-05
31-Mar-04
31-Dec-04
No of Units
No of Units
No of Units
Unit-holders:
HSBC Financial Services Middle
East Ltd, Dubai
%
648,277
29.3%
801,729 653,428
27.7%
28.9%
Gulf Investment Services Co
SAOG
%
475,549
21.5%
559,470 475,549
19.3%
21.0%
1,917,710 67.6%