Alternative Investment

Fondul Proprietatea : Quarterly Report 30 September 202


Fondul Proprietatea SA

Quarterly Report

For the Quarter Ended 30 September 2022

(This is a translation from the official Romanian version)

For public distribution only.

Fondul Proprietatea SA

Contents

List of Abbreviations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4

Analysis of the Fund’s Activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

Regulated Stock Market Trading. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

Performance Objectives. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8

Management and Governance of the Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9

GDR Facility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9

Dividend Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9

GSM During the Reporting Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10

Investor Relations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10

Buy-back Programmes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11

Outlook for 2022. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14

Regulatory Updates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15

Fees, charges and expenses which are directly or indirectly borne by investors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

17

Portfolio Analysis and Financial Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19

NAV Methodology and NAV Evolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19

Investment Strategy and Portfolio Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

21

Energy Sector Updates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

26

Update on the Largest 10 Portfolio Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

30

Financial Statements Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

38

Subsequent Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

42

Annexes

Annex 1 Condensed Interim Financial Statements for the nine-month period ended 30 September 2022, prepared in accordance with IAS 34 Interim Financial Reporting and applying the FSA Norm no. 39/ 2015, regarding the approval of the

accounting regulations in accordance with IFRS, applicable to the entities authorised, regulated, and supervised by the FSA – Financial Investments and Instruments Sector

Annex 2 Statement of Assets and Obligations of Fondul Proprietatea SA as at 30 September 2022, prepared in accordance with FSA Regulation 7/2020 (Annex no.11)

Fondul Proprietatea SA

Quarterly Report for the quarter ended 30 September 2022 1

Fondul Proprietatea SA

List of Abbreviations

ACDP

Annual Cash Distribution Policy

AIF

Alternative Investment Fund

AIF Law

Romanian Law no. 243/2019 on the regulation of alternative investment funds and

amending and supplementing certain normative acts

AIF Regulation

Regulation no. 7/2020 on the authorisation and function of alternative investment

funds, issued by the Financial Supervisory Authority

AIFM

Alternative Investment Fund Manager

AIFM Directive

Directive 2011/61/EU on Alternative Investment Fund Managers

AIFRI

Alternative investment fund for retail investors

ANAF

National Agency for Fiscal Administration

ANAR

National Administration for Romanian Water

ANRE

Romanian Energy Regulatory Authority

ASPAAS

Authority for the Public Supervision of the Statutory Audit Activity

ATS

Alternative Trading System

BoN

Board of Nominees of Fondul Proprietatea SA

BVB

Bucharest Stock Exchange

NBR

National Bank of Romania

CIIF

Certification of Registration of Financial Instruments

CRS

Common Reporting Standard

Depozitarul Central SA

Romanian Central Depositary

DLOM

Discount of Lack of Marketability

EBITDA

Operating profit before depreciation and amortization

EGM

Extraordinary General Shareholders Meeting

ESG

Environmental, Social and Governance

EU

European Union

FATCA

The Foreign Account Tax Compliance Act

Fondul Proprietatea/ the Fund/ FP

Fondul Proprietatea SA

FSA

Romanian Financial Supervisory Authority

FT

Franklin Templeton

FTIS/ Alternative Investment Fund

Franklin Templeton International Services S.à r.l.

Manager/ Sole Director

GDP

Gross Domestic Product

GDR

Global Depositary Receipt

GEO

Government Emergency Ordinance

GEO 1/2020

GEO 1/ 9 January 2020 regarding some fiscal-budgetary measures and the

amendment and completion of some normative acts

GEO 74/2020

GEO 74/ 19 May 2020 for modifying Romanian Energy Law no. 123/2012

GO

Government Ordinance

GRI

Global Reporting Initiative

GSM

General Shareholders Meeting

H1/ H2

First/ second semester

IFRS

International Financial Reporting Standards as endorsed by the European Union

INS

National Institute of Statistic

IMF

International Monetary Fund

IPO

Initial Public Offering

IPS

Investment Policy Statement

LME

London Metal Exchange

LSE

London Stock Exchange

MA

Management Agreement signed between Fondul Proprietatea and FTIS Luxembourg,

as Sole Director and Alternative Investment Fund Manager

NAV

Net Asset Value

OGM

Ordinary General Shareholders Meeting

PNRR

National Recovery and Resilience Plan

Fondul Proprietatea SA

Quarterly Report for the quarter ended 30 September 2022 2

Fondul Proprietatea SA

PRIIPs

Packaged retail and insurance-based investment products

Q1/ Q2/ Q3/ Q4

First/ second/ third/ fourth quarter

REGS

Main market (Regular) of Bucharest Stock Exchange

RRR

Regulatory Rate of Return

SAPE

The Company for the Administration of Participations in Energy SA

SME

Small and Medium Enterprise

TO

Tender Offer

Water Law

Romanian Water Law no. 107/1996

9M/ 9MO

9-month period

Fondul Proprietatea SA

Quarterly Report for the quarter ended 30 September 2022 3

Fondul Proprietatea SA

Overview

Company Information

Fondul Proprietatea was incorporated on 28 December 2005 as a joint stock company operating as a closed-end investment company. On 28 January 2022, FSA authorised Fondul Proprietatea as an AIF closed-end type addressed to retail investors, with BRD Groupe Société Générale as depositary. The Fund is registered with the Bucharest Trade Register under the number J40/21901/2005 and has the sole registration code 18253260.

The Fund’s investment objective is the maximisation of returns to shareholders and the increase of the net asset value per share via investments mainly in Romanian equities and equity-linked securities. The Fund Prospectus and the Fund Rules are published on the Fund’s website and the link can be found here.

During the period of nine months ended 30 September 2022, the Fund was managed by FTIS as its Sole Director and AIFM under the AIFM Directive and local implementation regulations, based on the Management Agreements in force between 1 April 2020 – 31 March 2022 and 1 April 2022 – 31 March 20241. The portfolio management and the administrative activities are performed by FTIS via its Bucharest Branch.

Since 25 January 2011, the Fund’s shares have been listed on BVB. Since 29 April 2015, the Fund’s GDRs issued by The Bank of New York Mellon as GDR Depositary, having the Fund’s shares as support, have been listed on the Specialist Fund Market of LSE.

Share information

Primary listing

Bucharest Stock Exchange – since 25 January 2011

Secondary listing

London Stock Exchange – since 29 April 2015

BVB symbol

FP

LSE symbol

FP.

Bloomberg ticker on BVB

FP RO

Bloomberg ticker on LSE

FP/ LI

Reuters ticker on BVB

FP.BX

Reuters ticker on LSE

FPq.L

ISIN

ROFPTAACNOR5

FSA register no

PJR09FIAIR/400018/28.01.2022

LEI code

549300PVO1VWBFH3DO07

CIIF registration no

AC-4522-9/27.10.2022

Source: Fondul Proprietatea

Shareholder Information

Shareholder Structure as at 30 September 20222

% of subscribed

% of

Shareholder categories

and paid-up

voting

share capital

rights

Romanian institutional shareholders

36.03%

40.32%

Romanian private individuals

20.38%

22.81%

The Bank of New York Mellon3 (GDRs)4

14.20%

15.49%

Foreign institutional shareholders

10.29%

11.52%

Romanian State represented by Ministry of Finance

5.78%

6.46%

Foreign private individuals

3.04%

3.40%

Treasury shares5

10.28%

Source: Depozitarul Central SA

As at 30 September 2022 the Fund had 15,539 shareholders and the total number of voting rights was 5,730,304,798. The Fund does not have unpaid shares at the reporting date.

  • During the 15 December 2021 GSM, shareholders approved the new mandate of FTIS as AIFM and Sole Director of the Fund for the period 1 April 2022 – 31 March 2024.
    2 Information provided based on settlement date of transactions
    3 The shares underlying the GDRs issued by the Bank of New York Mellon are held in the name of the Bank of New York Mellon and for the account of the GDRs holders.
    4 Fondul Proprietatea held 458,051 GDRs (22,902,550 shares equivalent) as at 30 September 2022
    5 658,989,619 treasury shares out of which 464,617,865 treasury shares acquired in 2022, during the thirteenth buyback program and 194,371,754 treasury shares acquired during the twelfth buyback program in 2021. The GDRs held by the Fund and not converted are included under The Bank of New York Mellon’s position for the paid-up shareholders structure, similar with the records provided by the Central Depositary. The GDRs held by the Fund are deducted from The Bank of New York Mellon’s position for the voting rights shareholder structure.

Fondul Proprietatea SA

Quarterly Report for the quarter ended 30 September 2022 4

Disclaimer

Fondul Proprietatea SA published this content on 15 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 November 2022 08:40:06 UTC.

Publicnow 2022

All news about FONDUL PROPRIETATEA SA

Sales 2021 5 120 M
1 080 M
1 080 M
Net income 2021 5 013 M
1 057 M
1 057 M
Net cash 2021 13 002 M
2 742 M
2 742 M
P/E ratio 2021 2,35x
Yield 2021
Capitalization 10 789 M
2 275 M
2 275 M
EV / Sales 2020 115x
EV / Sales 2021 -0,12x
Nbr of Employees 3
Free-Float 91,1%

Chart FONDUL PROPRIETATEA SA



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Fondul Proprietatea SA Technical Analysis Chart | MarketScreener

Income Statement Evolution

Sell

Buy

Mean consensus BUY
Number of Analysts 2
Last Close Price 1,89 RON
Average target price 2,57 RON
Spread / Average Target 36,3%


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