Long Dated Corporate Bond Fund

(1)

Long Dated Corporate Bond Fund

Interim Report and Accounts

(2)

Schroder

Long Dated Corporate

Bond Fund

Fund Information1 _{. . . .3}

Investment objective and policy . . . .3

Financial highlights . . . .3

Fund information . . . .3

Ongoing charges figure . . . .3

Total purchases and sales . . . .3

Review of Investment Activities1_{. . . .4}

Risk Profile1 _{. . . .5}

Risk and reward indicator . . . .5

Specific risks . . . .5

Net Asset Value and Comparative Tables1 _{. . . .6}

Unit price range . . . .6

Net revenue . . . .6

Net asset value . . . .6

Fund performance . . . .7

Portfolio Statement1 _{. . . .8}

Summary of Portfolio Transactions1 _{. . . .20}

Largest purchases . . . .20

Largest sales . . . .20

Statement of the Manager’s Responsibilities . . . .21

Statement of Total Return (unaudited) . . . .22

Statement of Change in Net Assets Attributable to Unitholders (unaudited) . . . .22

Balance Sheet (unaudited) . . . .23

Notes to the Accounts (unaudited) . . . .24

Basis for preparation . . . .24

Accounting policies . . . .24

General Information1_{. . . .25}

Authorisation . . . .25

European Union Savings Directive . . . .25

(3)

Fund Information

Investment objective

and policy

The fund’s investment objective is to provide capital growth and income primarily

through investment in long dated non-government debt securities.

The fund may also invest in a wide range of investments including transferable

securities, derivatives, cash, deposits, collective investment schemes and money

market instruments.

Financial

highlights

Dealing price 9.10.15 10.4.15 % change I Accumulation (Gross) units 251.90p 266.80p (5.58) X Accumulation (Gross) units 127.80p 135.30p (5.54)

Fund information

Launch date 24 March 2005

Launch price 132.00p per I Accumulation (Gross) unit 65.23p per X Accumulation (Gross) unit

Interim Final Accounting dates 10 October 10 April Revenue allocation date 10 June

Ongoing charges

figure

For the period For the year to 10.10.15 to 10.4.15 I Accumulation (Gross) units 0.27%1 _0.27%

X Accumulation (Gross) units2 _0.02%1 _0.02%

1 The Ongoing charges figure is annualised based on the fees incurred

during the accounting period.

2 The annual management charge for X Accumulation (Gross) units is

invoiced directly to unitholders and is therefore not included in the

Ongoing charges figure for that unit class.

Total purchases

and sales

For the period For the year to 10.10.15 to 10.4.15 £000’s £000’s Total purchases 93,647 95,087 Total sales 74,432 103,692

(4)

Review of Investment Activities

From 10 April 2015 to 9 October 2015, the price of I Accumulation (Gross)

units on a dealing price to dealing price basis fell 5.58%. In comparison,

the Bank of America Merrill Lynch Sterling Non-Gilts All Stocks Over

15 Years Index generated a negative total return of 6.24%

1

_.

1 Source: Thomson Reuters Datastream.

Long dated sterling corporate bonds generated a negative total return over the

period, but outperformed both US dollar and euro equivalents. The long end of

the US credit market saw a lot of supply, with issuers rushing to secure bond

financing before interest rates rise. In Europe, concern for the economic stability

of the region weighed on credit spreads as summer began, whilst negative

company specific developments affecting Glencore and Volkswagen weighed on

sentiment in the latter months. Doubt also gathered as to the validity of the

global recovery overall, negatively impacting risk assets across all markets.

The portfolio produced a negative return, but outperformed the benchmark. The

‘carry’ of the underlying bonds, the return generated by bond coupons and the

capital appreciation as the bonds draw towards maturity generated a degree of

outperformance, as did credit selection. The portfolio’s yield curve positioning

partially offset the progress, given our bias to the very long end of the yield curve,

where yield spreads widened more aggressively. Credit risk was selectively

added in sterling financials, taking advantage of wider spread levels.

A low growth, low inflation environment is traditionally very supportive for

corporate bond investors, and potential catalysts for lifting growth and inflation in

the UK have receded in 2015. Growth, overall, remains stable, but the

deterioration in China’s economy as well as persistent declines in the price of oil

and other commodities is likely to provide a deflationary pulse for the next few

quarters. The sterling and euro corporate bond markets are less exposed to the

oil price than the US, and we expect relative performance to remain robust.

Please remember that past performance is not a guide to future performance

and it might not be repeated. The value of investments and the revenue from

them may go down as well as up and investors may not get back the amount

originally invested. Because of this, you are not certain to make a profit on your

investments and you may lose money.

Fund Manager:

Alix Stewart

Investment career started in 1994

Joined Schroders in August 2012 as a

Credit Portfolio Manager

Prior to joining Schroders Alix worked

for the following companies:

2011 – UBS Global AM, Head of UK

Fixed Interest

2009 – UBS Global AM, Fund

Manager – UK Corporate Bonds

2008 – UBS Global AM, Fund

Manager – Global Corporate Bonds

2006 – SWIP, Fund Manager – High

Alpha UK Retail Corporate Bonds

2003 – Gartmore, Fund Manager –

High Alpha UK Retail Corporate Bonds

1999 – Standard Life Investments,

Fund Manager – Corporate Bonds

1994 – Scottish Mutual (ANFIS), Fund

Manager – Corporate Bonds

1991 – Scottish Mutual (ANFIS),

Actuarial Trainee

BSc (Hons) in Economic and

(5)

Risk Profile

The risk category was calculated using historical performance data and may not

be a reliable indicator of the fund’s future risk profile.

The fund is in this category because it can take higher risks in search of higher

rewards and its price may rise and fall accordingly.

The fund’s risk category is not guaranteed to remain fixed and may change over

time.

A fund in the lowest category does not mean a risk free investment.

The fund invests in assets which are exposed to currencies other than sterling.

Exchange rates may cause the value of overseas investments and the revenue

from them to rise or fall.

The fund invests in higher yielding bonds (non-investment grade). The risk of

default is higher with non-investment grade bonds than with investment grade

bonds. Higher yielding bonds may also have an increased potential to erode your

capital sum than lower yielding bonds.

The fund uses derivatives for specific investment purposes. This involves a higher

degree of risk and may lead to a higher volatility in the unit prices of the fund. The

Manager employs a risk management process to allow the Manager to measure

derivative and forward positions and their contribution to the overall risk profile of

the fund. As part of this risk management process, the Manager conducts daily

value at risk analysis of the fund and performs both stress and back testing of

the fund.

As a result of the annual management charge for I Accumulation (Gross) units

being charged wholly to capital, the distributable revenue of the fund may be

higher, but the capital value of the fund may be eroded which may affect future

performance.

For these reasons, the purchase of units should not normally be regarded as a

short term investment.

Risk and reward

indicator

Specific risks

Lower risk

Potentially lower reward

Higher risk Potentially higher reward

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Net Asset Value and Comparative Tables

Unit price range

I Accumulation X Accumulation

Year to 31 December (Gross) units (Gross) units

Highest Lowest Highest Lowest dealing dealing dealing dealing

p p p p 2010 180.90 159.00 90.57 79.48 2011 189.90 170.10 95.39 85.23 2012 215.30 187.70 108.50 94.33 2013 227.30 205.10 114.60 103.50 2014 255.40 214.30 129.30 108.30 2015 to 10 October 276.10 246.50 139.90 125.00

Net revenue

I Accumulation X Accumulation

(Gross) units (Gross) units

Year to 31 December pence per unit pence per unit

2010 9.1824 4.4722 2011 9.7060 4.7800 2012 9.5403 4.7859 2013 9.6825 4.8787 2014 10.9454 5.5272 2015 to 10 October 11.4001 5.7711

Net asset value

Net asset

Net asset value value per unit Number of

As at 10 April £000’s p units in issue 2013

I Accumulation (Gross) units 272,874 217.40 125,516,817 X Accumulation (Gross) units 30,340 109.64 27,671,432

2014

2015

2015 at 10 October

(7)

Net Asset Value and Comparative Tables

(continued)

Net Asset Value and Comparative Tables

(continued)

Fund performance

Net asset Net asset

value per unit value per unit

p p

as at 10.10.15 as at 10.4.15 % change

I Accumulation (Gross) units 249.68 265.42 (5.93) X Accumulation (Gross) units 126.72 134.53 (5.81)

Please remember that past performance is not a guide to future performance

and it might not be repeated. The value of investments and the revenue from

them may go down as well as up and investors may not get back the amount

originally invested. Because of this, you are not certain to make a profit on your

investments and you may lose money.

(8)

Holding at Market Value % of net 10.10.15 £000’s assets

Portfolio Statement

Euro Denominated Short Term Bonds 0.22%

(10.4.15 – 0.22%) Viridian Group FundCo II

7.5% Notes 2020 €900,000 663 0.22

663 0.22 Euro Denominated Medium Term Bonds 0.90%

(10.4.15 – 0.44%) Wind Acquisition Finance

7% Notes 2021 €400,000 297 0.10 Cellnex Telecom

3.125% Notes 2022 €1,100,000 783 0.26 Grupo Antolin Dutch

5.125% Notes 2022 €812,000 602 0.20 TDF Infrastructure

2.875% Bonds 2022 €1,000,000 731 0.24 Bankia 4% Notes 2024 €400,000 294 0.10

2,707 0.90 Euro Denominated Long Term Bonds 1.18%

(10.4.15 – 0.91%) UNIQA Insurance Group

6% Bonds 2046 €1,500,000 1,145 0.38 Tesco 5.125% Notes 2047 €1,390,000 952 0.32 Allianz 3.375% Perpetual Bonds €700,000 511 0.17 Groupama 6.375%

Perpetual Bonds €1,300,000 950 0.31

3,558 1.18 Euro Denominated Derivatives (0.11)%

(10.4.15 – (0.34)%)

Forward to sell €10,797,046

for £7,921,066 €(10,797,046) (79) (0.03) Euro BOBL Futures

December 2015 5 1 0.00

Euro Bund Futures

December 2015 (5) 2 0.00

Barclays Stora Enso 2016 Credit

Default Swap Buy Protection 1 _€545,000 ₍₁₉₎ _(0.01)

BNP Paribas Akzo Nobel 2016 Credit Default

(9)

Portfolio Statement (continued)

Euro Denominated Derivatives (continued)

Credit Suisse Stora Enso 2016 Credit Default Swap

Buy Protection 1 _€970,000 ₍₃₄₎ _(0.01)

Deutsche Bank Akzo Nobel 2016 Credit Default

Swap Buy Protection 1 _€142,000 ₍₁₎ _0.00

Deutsche Bank HeidelbergCement 2016 Credit Default Swap

Buy Protection 1 _€1,095,000 ₍₂₉₎ _(0.01)

JPMorgan Akzo Nobel 2016 Credit Default Swap

Buy Protection 1 2 _€352,000 ₍₂₎ _0.00

JPMorgan HeidelbergCement 2016 Credit Default Swap

Buy Protection 1 2 _€545,000 ₍₁₄₎ _0.00

JPMorgan Stora Enso 2016 Credit Default Swap

Buy Protection 1 2 _€540,000 ₍₁₉₎ _(0.01)

LafargeHolcim 2016 Credit

Default Swap Buy Protection 1 _€900,000 ₍₄₎ _0.00

Telecom Italia 2016 Credit

Default Swap Buy Protection 1 _€3,390,000 ₍₁₅₎ _0.00

UPM-Kymmene 2016 Credit

Default Swap Buy Protection 1 _€770,000 ₍₂₁₎ _(0.01)

Adecco 2017 Credit Default

Swap Buy Protection 1 _€1,500,000 ₍₁₉₎ _(0.01)

STMicroelectronics 2017 Credit Default Swap

Buy Protection 1 _€538,000 ₍₃₎ _0.00

Barclays Telefonica 2018 Credit

Default Swap Buy Protection 1 _€325,000 ₍₂₎ _0.00

Barclays Telenor 2018 Credit

Default Swap Buy Protection 1 _€1,950,000 ₍₂₈₎ _(0.01)

Citigroup Telefonica 2018 Credit

Default Swap Buy Protection 1 _€320,000 ₍₂₎ _0.00

JPMorgan Telefonica 2018 Credit

Default Swap Buy Protection 1 2 _€445,000 ₍₂₎ _0.00

JPMorgan Telenor 2018 Credit

Default Swap Buy Protection 1 2 _€1,570,000 ₍₂₃₎ _(0.01)

Wolters Kluwer 2018 Credit

Default Swap Buy Protection 1 _€2,090,000 ₍₃₁₎ _(0.01)

Heathrow Funding 2018 Credit

Default Swap Sell Protection 1 _€2,375,000 ₂₂ _0.01

SSE 2018 Credit Default

(10)

Portfolio Statement (continued)

Euro Denominated Derivatives (continued)

Credit Suisse Compagnie Financiere du Groupe Michelin 2019 Credit

Default Swap Buy Protection 1 _€300,000 ₍₄₎ _0.00

JPMorgan Compagnie Financiere du Groupe Michelin 2019 Credit

Default Swap Buy Protection 1 2 _€360,000 ₍₅₎ _0.00

Merrill Lynch Compagnie Financiere du Groupe Michelin 2019 Credit

Default Swap Buy Protection 1 _€360,000 ₍₅₎ _0.00

Tesco 2019 Credit Default

Swap Sell Protection 1 _€2,500,000 ₍₈₇₎ _(0.03)

WPP 2019 Credit Default

Swap Sell Protection 1 _€487,000 ₈ _0.00

Standard Chartered Bank 2020 Credit Default Swap

Buy Protection 1 _€1,930,000 ₉₈ _0.03

(315) (0.11) Sterling Denominated Short Term Bonds 1.08%

(10.4.15 – 1.44%) Heathrow Finance 5.375% Notes 2019 £1,100,000 1,160 0.38 J Sainsbury 1.25% Bonds 2019 £800,000 845 0.28 Kelda Finance No 3 5.75% Notes 2020 £1,200,000 1,251 0.42 3,256 1.08 Sterling Denominated Medium Term Bonds 9.46%

(10.4.15 – 5.96%) Annington Finance No 1

8% Bonds 2021 £1,060,253 1,252 0.42 Segro 6.75% Notes 2021 £1,230,000 1,494 0.50 Firstgroup 5.25% Bonds 2022 £1,400,000 1,511 0.50 Friends Life Holdings

8.25% Notes 2022 £1,878,000 2,227 0.74 InterContinental Hotels Group

3.875% Notes 2022 £2,080,000 2,131 0.71 Investec Bank 4.5% Notes 2022 £1,710,000 1,704 0.57 Investec Bank 9.625% Notes 2022 £570,000 679 0.23 Nordea Bank 2.375% 2022 £800,000 788 0.26 Rabobank Nederland

(11)

Portfolio Statement (continued)

Sterling Denominated Medium Term Bonds (continued)

Anglian Water Osprey

Financing 5% Notes 2023 £600,000 594 0.20 Virgin Media Finance

7% Notes 2023 £950,000 983 0.33 Firstgroup 6.875% Bonds 2024 £943,000 1,125 0.37 Unique Pub Finance

7.395% Bonds 2024 £679,000 689 0.23 Virgin Media Finance

6.375% Notes 2024 £800,000 798 0.27 InterContinental Hotels Group

3.75% Notes 2025 £900,000 893 0.30 Abbey National Treasury Services

3.875% Notes 2029 £1,350,000 1,397 0.47 BPCE 5.25% Notes 2029 £1,700,000 1,761 0.59 Arqiva Financing 5.34%

Notes 2030 £1,400,000 1,542 0.51 Canary Wharf Finance II

6.455% Bonds 2030 £729,125 962 0.32 Canary Wharf Finance II

6.8% Bonds 2030 £551,869 695 0.23 Intu SGS Finance

4.25% Notes 2030 £1,400,000 1,423 0.47 Longstone Finance

4.791% Bonds 2030 £673,884 758 0.25 Mitchells & Butlers Finance

6.469% Bonds 2030 £568,000 698 0.23 South Eastern Power Networks

5.625% Notes 2030 £400,000 487 0.16

28,403 9.46 Sterling Denominated Long Term Bonds 79.34%

(10.4.15 – 73.20%) Mitchells & Butlers

5.574% Bonds 2030 £535,272 611 0.20 Motability Operations Group

5.625% Notes 2030 £400,000 502 0.17 East Japan Railway

4.75% Notes 2031 £600,000 707 0.24 Great Rolling Stock

6.5% Notes 2031 £919,680 1,159 0.39 Greene King Finance

5.318% Bonds 2031 £360,581 417 0.14 Longstone Finance

(12)

Portfolio Statement (continued)

Sterling Denominated Long Term Bonds (continued)

National Grid Electricity Transmission

7.375% Notes 2031 £2,373,000 3,463 1.15 Places for People Homes

5.875% Notes 2031 £850,000 1,009 0.34 South Eastern Power Networks

6.375% Notes 2031 £920,000 1,211 0.40 Telereal Securitisation

5.5534% Bonds 2031 £270,985 322 0.11 Telereal Securitisation

6.1645% Bonds 2031 £2,351,210 2,769 0.92 Yorkshire Water Services

Odsal Finance 6.6011%

Bonds 2031 £903,000 1,202 0.40 Arqiva Financing 4.882%

Notes 2032 £1,300,000 1,406 0.47 E.ON International Finance

6.375% Notes 2032 £1,515,000 1,814 0.60 Land Securities Capital Markets

5.396% Notes 2032 £474,000 580 0.19 Northern Powergrid Yorkshire

4.375% Bonds 2032 £300,000 324 0.11 Southern Electric Power

Distribution 5.5% Bonds 2032 £502,000 600 0.20 Thames Water Utilities Finance

6.5% Notes 2032 £500,000 658 0.22 Western Power Distribution (West

Midlands) 5.75% Notes 2032 £1,475,000 1,813 0.60 Broadgate Financing

4.821% Bonds 2033 £570,000 671 0.22 East Japan Railway

5.25% Notes 2033 £450,000 558 0.19 Heathrow Funding

6.45% Notes 2033 £2,744,000 3,580 1.19 Juturna (European Loan Conduit

No 16) 5.0636% Notes 2033 £1,135,269 1,304 0.43 Procter & Gamble

5.25% Notes 2033 £284,000 359 0.12 Telereal Securitisation

4.090% Notes 2033 £900,000 928 0.31 East Japan Railway

4.875% Notes 2034 £450,000 533 0.18 EDF 6.125% Notes 2034 £1,450,000 1,747 0.58 Greene King Finance

(13)

Portfolio Statement (continued)

John Lewis 4.25% Bonds 2034 £1,500,000 1,470 0.49 RWE Finance 4.75% Notes 2034 £800,000 745 0.25 Scotland Gas Network

4.875% Notes 2034 £300,000 335 0.11 Thames Water Cayman

4.375% Notes 2034 £300,000 316 0.11 Verizon Communications

4.75% Notes 2034 £1,600,000 1,690 0.56 Wal-Mart Stores 5.625%

Notes 2034 £958,000 1,233 0.41 British Land 5.264% Bonds 2035 £474,000 528 0.18 Eversholt Funding

6.697% Notes 2035 £1,250,000 1,609 0.54 Great Rolling Stock

6.875% Notes 2035 £765,850 969 0.32 Northern Electric Finance

5.125% Bonds 2035 £200,000 235 0.08 Northern Powergrid Yorkshire

5.125% Bonds 2035 £300,000 352 0.12 Segro 5.75% Notes 2035 £319,000 400 0.13 SNCF Reseau 5.25%% Notes 2035 £1,140,000 1,466 0.49 Wal-Mart Stores 5.25% Notes 2035 £1,486,000 1,859 0.62 East Japan Railway

4.5% Notes 2036 £450,000 510 0.17 Eastern Power Networks

6.25% Notes 2036 £500,000 658 0.22 Land Securities Capital Markets

5.125% Notes 2036 £994,000 1,194 0.40 Wellcome Trust Finance

4.625% Bonds 2036 £900,000 1,107 0.37 Canary Wharf Finance II

A3 5.952% Bonds 2037 £645,000 798 0.27 E.ON International Finance

5.875% Notes 2037 £1,150,000 1,311 0.44 EDF 5.5% Notes 2037 £3,100,000 3,487 1.16 Enel 5.75% Notes 2037 £797,000 916 0.30 Gatwick Funding 5.75% Notes 2037 £500,000 604 0.20 Southern Electric Power Distribution

4.625% Bonds 2037 £1,700,000 1,835 0.61 Thames Water Utilities Finance

5.125% Notes 2037 £2,284,000 2,644 0.88 Goldman Sachs Group

(14)

Portfolio Statement (continued)

High Speed Rail Finance

4.375% Notes 2038 £2,790,000 3,002 1.00 HSBC Holdings 7% Notes 2038 £2,250,000 2,797 0.93 Pfizer 6.5% Notes 2038 £2,150,000 2,986 0.99 Southern Water Services

Finance 4.5% Notes 2038 £800,000 827 0.28 SSE 6.25% Notes 2038 £1,180,000 1,515 0.50 Citigroup 7.375% Notes 2039 £3,406,000 5,040 1.68 E.ON International Finance

6.75% Notes 2039 £1,050,000 1,313 0.44 European Investment

Bank 5% Bonds 2039 £6,736,000 9,165 3.05 GlaxoSmithKline Capital

6.375% Notes 2039 £1,785,000 2,458 0.82 RWE Finance 6.125% Notes 2039 £1,900,000 2,056 0.68 Vattenfall 6.875% Notes 2039 £870,000 1,140 0.38 Wal-Mart Stores 4.875%

Bonds 2039 £1,922,000 2,296 0.76 Yorkshire Water Services Bradford

Finance 6.375% Notes 2039 £1,200,000 1,608 0.54 Aspire Defence Finance

A 4.674% Bonds 2040 £1,679,907 1,888 0.63 Aspire Defence Finance

B 4.674% Bonds 2040 £2,725,942 3,065 1.02 AT&T 7% Notes 2040 £4,650,000 6,048 2.01 DONG Energy 5.75% Notes 2040 £3,516,000 4,153 1.38 Enel Finance International

5.75% Notes 2040 £4,177,000 4,800 1.60 Lloyds Bank 6.5% Notes 2040 £2,770,000 3,787 1.26 London & Quadrant Housing

Trust 5.5% Bonds 2040 £1,765,000 2,196 0.73 Northern Gas Networks Finance

5.625% Notes 2040 £1,642,000 2,018 0.67 Southern Gas Networks

6.375% Notes 2040 £1,231,000 1,643 0.55 Treasury 4.25% Stock 2040 £1,370,000 1,799 0.60 UPP Bond 1 Issuer

4.9023% Notes 2040 £2,742,669 3,044 1.01 Western Power Distribution (East

Midlands) 6.25% Notes 2040 £500,000 664 0.22 Western Power Distribution (South

(15)

Portfolio Statement (continued)

EDF 5.5% Notes 2041 £7,600,000 8,533 2.84 Gatwick Funding 6.5% Notes 2041 £600,000 797 0.27 Heathrow Funding

5.875% Notes 2041 £2,200,000 2,728 0.91 HSBC Bank 6.25% Notes 2041 £359,000 427 0.14 Southern Water Services

Finance 5% Notes 2041 £960,000 1,094 0.36 Thames Water Utilities Cayman

Finance 5.5% Notes 2041 £900,000 1,093 0.36 Apple 3.6% Notes 2042 £3,000,000 2,914 0.97 Northumbrian Water Finance

5.125% Notes 2042 £600,000 690 0.23 Severn Trent Utilities Finance

4.875% Notes 2042 £1,460,000 1,621 0.54 Siemens Financieringsmaatschappij

3.75% Notes 2042 £2,200,000 2,166 0.72 Standard Life 5.5% Notes 2042 £1,512,000 1,589 0.53 Tesco 4.875% Notes 2042 £3,891,000 3,036 1.01 Transport for London

3.875% Notes 2042 £3,000,000 3,279 1.09 Treasury 4.5% Stock 2042 £935,000 1,289 0.43 AT&T 4.25% Bonds 2043 £1,440,000 1,309 0.44 AT&T 4.875% Bonds 2044 £2,780,000 2,769 0.92 European Investment Bank

4.5% Bonds 2044 £1,420,000 1,858 0.62 GlaxoSmithKline Capital 4.25% Notes 2045 £1,389,000 1,464 0.49 Treasury 3.5% Stock 2045 £1,610,000 1,908 0.64 Heathrow Funding 4.625% Notes 2046 £1,470,000 1,549 0.52 HSBC Bank 4.75% Notes 2046 £1,636,000 1,573 0.52 Thames Water Utilities Cayman

Finance 4.625% Notes 2046 £2,880,000 3,121 1.04 EDF 5.125% Notes 2050 £1,700,000 1,823 0.61 Orange 5.375% Notes 2050 £2,350,000 2,703 0.90 LCR Finance 5.1% Bonds 2051 £3,790,000 5,649 1.88 Southern Water Services

Finance 4.5% Bonds 2052 £300,000 324 0.11 European Investment Bank

4.625% Bonds 2054 £1,193,000 1,696 0.56 Notting Hill Housing Trust

(16)

Portfolio Statement (continued)

Treasury 4.25% Stock 2055 £690,000 996 0.33 DWR Cymru Financing 4.473% Notes 2057 £200,000 221 0.07 Aviva 6.875% Notes 2058 £1,400,000 1,523 0.51 SNCF Reseau 4.83% Notes 2060 £3,881,000 5,215 1.74 Legal & General Group

5.5% Notes 2064 £2,473,000 2,371 0.79 Treasury 3.5% Stock 2068 £918,844 1,184 0.39 Koninklijke KPN 6.875% Notes 2073 £1,075,000 1,109 0.37 NGG Finance 5.625% Bonds 2073 £1,500,000 1,587 0.53 Enel 7.75% Bonds 2075 £1,750,000 1,890 0.63 EDF 6% Notes 2114 £1,300,000 1,564 0.52 United Mexican States

5.625% Notes 2114 £2,141,000 2,058 0.69 Assicurazioni Generali

6.416% Perpetual Bonds £2,500,000 2,538 0.85 Aviva 5.9021% Perpetual Notes £2,151,000 2,207 0.73 Bank of Scotland 7.754%

Perpetual Bonds £1,403,000 1,599 0.53 Barclays Bank 5.33%

Perpetual Bonds £2,090,000 1,960 0.65 EDF 6% Perpetual Notes £1,900,000 1,892 0.63 Engie 4.525% Perpetual Bonds £1,900,000 1,956 0.65 J Sainsbury 6.5%

Perpetual Bonds £900,000 907 0.30 Old Mutual 6.376%

Perpetual Notes £637,000 629 0.21 RWE 7% Perpetual Notes £1,000,000 998 0.33 SSE 3.875% Perpetual Bonds £2,000,000 1,944 0.65

238,245 79.34 Sterling Denominated Derivatives 1.13%

(10.4.15 – 1.34%)

Long Gilt Futures December 2015 (106) 89 0.03 Citigroup Interest Rate Swap

16.10.34 receive 2.472%

pay 0.69% 1 _£8,770,000 ₄₃₄ _0.14

Royal Bank of Scotland Interest Rate Swap 10.6.35 receive

(17)

Portfolio Statement (continued)

Sterling Denominated Derivatives (continued)

Citigroup Interest Rate Swap 21.6.43 receive 0.72563%

pay 3.2375% 1 _£9,000,000 _(2,010) _(0.67)

Goldman Sachs Interest Rate Swap 4.12.43 receive 3.355%

pay 0.71531% 1 _£1,300,000 ₃₂₆ _0.11

Merrill Lynch Interest Rate Swap 17.2.44 receive 3.3375%

pay 0.75125% 1 _£11,000,000 _2,735 _0.91

BNP Paribas Interest Rate Swap 22.5.44 receive 3.229%

pay 0.4875% 1 _£2,325,000 ₅₂₈ _0.18

Citigroup Interest Rate Swap 3.7.44 receive 3.2675%

pay 0.73563% 1 _£5,700,000 _1,345 _0.45

Barclays Bank Interest Rate Swap 6.7.45 receive 2.37%

pay 0.73063% 1 _£3,300,000 ₁₄₆ _0.05

Barclays Bank Interest Rate Swap 7.7.45 receive 2.273%

pay 0.7295% 1 _£3,300,000 ₇₅ _0.02

Royal Bank of Scotland Interest Rate Swap 13.2.54 receive 0.75%

pay 3.2925% 1 _£2,500,000 ₍₇₆₄₎ _(0.25)

3,391 1.13 US Dollar Denominated Short Term Bonds 0.34%

(10.4.15 – 0.55%) Marfrig Holdings Eurpoe

8.375% Notes 2018 US$1,670,000 1,016 0.34

1,016 0.34 US Dollar Denominated Medium Term Bonds 0.44%

(10.4.15 – 0.61%)

SPCM 6% Notes 2022 US$820,000 525 0.18 Koninklijke KPN 8.375%

Bonds 2030 US$919,000 786 0.26

1,311 0.44 US Dollar Denominated Long Term Bonds 1.36%

(10.4.15 – 11.67%) Freeport-McMoRan

(18)

Portfolio Statement (continued)

US Dollar Denominated Long Term Bonds (continued)

Kinder Morgan

5.55% Notes 2045 US$1,358,000 744 0.25 Enel 8.75% Bonds 2073 US$331,000 251 0.08 EDF 6% Notes 2114 US$1,768,000 1,155 0.39 Friends Life Holdings

7.875% Perpetual Notes US$1,218,000 883 0.29

4,072 1.36 US Dollar Denominated Derivatives (0.18)%

(10.4.15 – (0.91)%)

Forward to buy US$6,256,897

for £4,069,595 US$6,256,897 10 0.00 Forward to buy US$12,519,714

for £8,237,743 US$12,519,714 (75) (0.02) Forward to sell US$200,000

for £130,540 US$(200,000) 0 0.00 Forward to sell US$26,088,999

for £16,687,551 US$(26,088,999) (323) (0.11) US Treasury 5 Year

Futures December 2015 (35) 2 0.00 US Treasury 10 Year

Futures December 2015 (38) (19) (0.01) US Ultra Bond Futures

December 2015 (19) 0 0.00

Citigroup Japan 2017 Credit

Default Swap Buy Protection 1 _US$3,300,000 ₍₄₁₎ _(0.01)

Credit Suisse Japan 2017 Credit

Default Swap Buy Protection 1 _US$1,500,000 ₍₁₉₎ _(0.01)

People’s Republic of China 2017 Credit Default Swap

Buy Protection 1 _US$200,000 ₍₁₎ _0.00

Barclays Johnson Controls 2018 Credit Default Swap

Buy Protection 1 _US$3,615,000 ₍₄₈₎ _(0.01)

BNP Paribas Lowe’s 2018 Credit Default Swap Buy

Protection 1 _US$1,078,000 ₍₁₆₎ _0.00

JPMorgan Lowe’s 2018 Credit

Default Swap Buy Protection1 2 _US$1,122,000 ₍₁₇₎ _(0.01)

(19)

Market Value % of net £000’s assets

Portfolio Statement (continued)

Portfolio of investments 3 _285,760 _95.16

Net other assets 14,537 4.84

Net assets attributable to unitholders 300,297 100.00

Investment grade securities 252,504 84.08 Speculative grade securities 26,246 8.74 Unrated securities 4,481 1.49

Total of debt securities 283,231 94.31

Unless otherwise stated the above securities are admitted to official stock

exchange listings or traded on a regulated market.

1 Over the counter derivative instruments not listed on recognised exchanges.

2 A related party to the fund.

(20)

Summary of Portfolio Transactions

Largest purchases

Cost

For the six months ended 10 October 2015 £000’s

European Investment Bank 5% Bonds 2039 5,745 LCR Finance 5.1% Bonds 2051 5,734 Prudential 5% Notes 2055 5,104 Transport for London 3.875% Notes 2042 3,351 DONG Energy 5.75% Notes 2040 3,231

Apple 3.6% Notes 2042 2,983

AT&T 7% Notes 2040 2,935 Thames Water Utilities Cayman Finance 4.625% Notes 2046 2,902 Italy 5.25% Notes 2034 2,865 Treasury 4.5% Stock 2042 2,799

Largest sales

Proceeds

For the six months ended 10 October 2015 £000’s

Apple 4.45% Notes 2044 4,476 Notting Hill Housing Trust 4.375% Bonds 2054 2,973 Verizon Communications 4.672% Notes 2055 2,971

Italy 6% Notes 2028 2,958

DirecTV Holdings 5.15% Bonds 2042 2,831 Medtronic 4.625% Notes 2045 2,812 Digital Stout Holdings 4.25% Notes 2025 2,565 GlaxoSmithKline Capital 5.25% Bonds 2042 2,106 Northumbrian Water Finance 5.625% Bonds 2033 1,988 European Investment Bank 5.625% Bonds 2032 1,965

(21)

Statement of the Manager’s Responsibilities

The Financial Conduct Authority’s Collective Investment Schemes sourcebook

(COLL) requires the Manager to prepare accounts for each annual and half yearly

accounting period, in accordance with United Kingdom Generally Accepted

Accounting Practice, which give a true and fair view of the financial position of

the fund and of its net revenue and the net capital losses on the property of the

fund for the period. In preparing the accounts the Manager is required to:

–

select suitable accounting policies and then apply them consistently;

–

comply with the disclosure requirements of the Statement of Recommended

Practice (SORP) for Authorised Funds issued by the Investment Management

Association (IMA (now the Investment Association (IA))) in May 2014;

–

follow generally accepted accounting principles and applicable

accounting standards;

–

prepare the accounts on the basis that the fund will continue in operation

unless it is inappropriate to do so;

–

keep proper accounting records which enable it to demonstrate that the

accounts as prepared comply with the above requirements.

The Manager is responsible for the management of the fund in accordance

with its Trust Deed, the Prospectus and the COLL and for taking reasonable

steps for the prevention and detection of fraud, error and non-compliance

with law or regulations.

The Manager’s report and accounts for the period ended 10 October 2015 were

signed on 26 November 2015 on behalf of the Manager by:

J.A. Walker-Hazell

J.M. Cardew

(22)

Statement of Total Return (unaudited)

Statement of Change in Net Assets

Attributable to Unitholders (unaudited)

For the six months ended 10 October 2015

10.10.15 10.10.14

£000’s £000’s £000’s £000’s

Income

Net capital (losses)/gains (25,030) 14,942

Revenue 6,513 6,745

Expenses (357) (341)

Net revenue before taxation 6,156 6,404

Taxation 0 0

Net revenue after taxation 6,156 6,404

Total return before

distributions (18,874) 21,346

Distributions 0 (185)

Change in net assets attributable to unitholders

from investment activities (18,874) 21,161

For the six months ended 10 October 2015

10.10.15 10.10.14

£000’s £000’s £000’s £000’s

Opening net assets

attributable to unitholders 304,9551 _269,829 Amounts receivable on issue of units 40,971 8,515 Amounts payable on cancellation of units (27,134) (19,991) 13,837 (11,476) Dilution adjustment 379 53

Change in net assets attributable to unitholders

from investment activities (18,874) 21,161

Closing net assets

attributable to unitholders 300,297 279,5671

1 The Opening net assets attributable to unitholders for the current period do

not equal the Closing net assets attributable to unitholders for the comparative

(23)

Balance Sheet (unaudited)

As at 10 October 2015 10.10.15 10.4.15 £000’s £000’s Assets Investments 289,543 297,436 Current assets Debtors 11,835 4,715

Cash and bank balances 7,475 13,805

Total assets 308,853 315,956 Liabilities Investment liabilities (3,783) (7,443) Creditors Bank overdrafts (1,262) 0 Other creditors (3,511) (3,558) Total liabilities (8,556) (11,001)

Net assets attributable

(24)

Notes to the Accounts (unaudited)

Basis for preparation

The accounts have been prepared under the historical cost basis, as

modified by the revaluation of investments, and in accordance with the

SORP for Authorised Funds issued by the IMA in May 2014, which

supersedes the SORP issued by the IMA in October 2010 and in

accordance with United Kingdom Generally Accepted Accounting

Practice, including Financial Reporting Standard 102 (The Financial

Reporting Standard Applicable in the UK and Republic of Ireland (FRS

102)). Both of which became effective for the periods beginning on or

after 1 January 2015.

There have been no changes to the financial position or financial performance of

the fund as a result of the above.

The accounting policies applied are consistent with those of the annual accounts

for the year ended 10 April 2015 and are described in those annual accounts.

Accounting policies

(25)

General Information

Manager

Schroder Unit Trusts Limited

31 Gresham Street

London EC2V 7QA

Authorised and regulated by

the Financial Conduct Authority

Investment Adviser

Schroder Investment Management Limited

31 Gresham Street

London EC2V 7QA

Authorised and regulated by

the Financial Conduct Authority

Trustee

J.P. Morgan Europe Limited

Chaseside

Bournemouth BH7 7DA

Authorised by the Prudential

Regulation Authority and regulated

by the Financial Conduct Authority

and Prudential Regulation Authority

Registrar

1