UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number 811-08614
Brandes Investment Trust
(Exact name of registrant as specified in charter)
11988 El Camino Real, Suite 600
San Diego, CA 92130
(Address of principal executive offices) (Zip code)
Lea Anne Copenhefer
Morgan, Lewis & Bockius LLP
One Federal Street
Boston, MA 02110-1726
(Name and address of agent for service)
(800) 331-2979
Registrant’s telephone number, including area code
Date of fiscal year end: September 30
Date of reporting period: March 31, 2021
Item 1. Reports to Stockholders.
(a) The following is a copy of the reports transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 (the “Act”) (17 CFR 270.30e-1):
SEMI-ANNUAL
REPORT
INTERNATIONAL EQUITY FUND
GLOBAL EQUITY FUND
GLOBAL EQUITY FUND
EMERGING MARKETS VALUE FUND
INTERNATIONAL SMALL CAP EQUITY FUND
SMALL CAP VALUE FUND
CORE PLUS FIXED INCOME FUND
For the six months ended March 31, 2021
Brandes International Equity Fund
Dear Fellow Investor,
The net asset value of the Brandes International Equity Fund (Class I Shares) advanced 32.98% in the six months ended March 31, 2021. During the same period, the MSCI EAFE Index advanced 20.08%.
The Fund benefited from various cyclically oriented holdings, including Mexico-based cement producer Cemex and media companies Publicis Groupe SA (France) and WPP Plc (United Kingdom). Other contributors included Fund holdings in oil gas and consumable fuels (e.g., Italy’s Eni and Spain’s Repsol) and banks (e.g., U.K.-based Barclays and France-based BNP Paribas).
Detractors included China Mobile, Spanish biotechnology company Grifols and Swiss pharmaceutical firm Novartis.
Recent Portfolio Activity
During the six-month period through March 31, 2021, the investment committee initiated positions in Germany-based Fresenius Medical Care and Brazil’s Telefonica Brasil, as well as health care firms Novartis (Switzerland) and Grifols (Spain).
Fresenius is a global health care conglomerate with a focus on four main segments: dialysis, injectables, hospitals and hospital technology. Our analysis shows that Fresenius boasts a strong competitive position and enjoys attractive long-term growth potential thanks to growing demand across all four of its main businesses. The most attractive division is, in our opinion, its injectables business, as the market has significant regulatory barriers to entry, resulting in solid margins for the segment. Fresenius’ share price declined over the last year and has not recovered along with the market. At its current valuation levels, the company trades at what we consider a compelling discount to its estimated long-term intrinsic value.
Telefonica Brasil is a company we’re very familiar with as we had owned it in the past. Similar to Fresenius, Telefonica Brasil saw its share price fall over the past year, creating a good entry point for investment for us—especially in light of the improving competitive environment in Brazil. The Brazilian wireless telecom market has consolidated down to three operators (including Telefonica Brasil), which should set up for more attractive economics for the remaining players going forward. As the market leader with a strong network and brand, Telefonica Brasil is, in our view, well positioned to benefit from continued growth in smartphone penetration and usage.
Novartis is one of the world’s largest pharmaceutical firms. The company’s shares have underperformed the general market (MSCI EAFE) over the last five years, including during the recent market rebound, resulting in a valuation level that provided what we considered an attractive entry point for an investment.
Over the last decade, Novartis has sold its vaccine and consumer businesses to focus on pharmaceuticals and generics. It is now the third-largest generic drug manufacturer in the world by revenue, while boasting a strong ophthalmic franchise and a solid position in immunology, neuroscience and respiratory drugs. We appreciate Novartis’ diversified global revenue base, its economies of scale and its drug pipeline that we believe provides long-term upside potential.
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Novartis currently trades at a discount to other European pharmaceutical companies as the market seems to focus on the upcoming ending of its patent and investors are concerned about pricing pressure on generic drugs. However, we believe the company should be able to manage its upcoming patent cliff well and its generic business is more attractive than that of its peers as Novartis specializes in higher-barrier and less-commoditized segments of biosimilars and other products that are difficult to manufacture. At its current valuation level, we see Novartis as an attractive opportunity with some downside protection and upside potential.
Biopharmaceutical firm Grifols develops, manufactures and distributes biological medicines derived from blood plasma. Processing blood plasma is a capital intensive and highly regulated industry that is an oligopoly comprising three vertically integrated players (including Grifols). The industry enjoys attractive long-term growth prospects because an aging patient population and the chronic nature of most illnesses treated by the drugs have resulted in a stable demand.
The industry’s primary revenue growth driver is the global demand for immunoglobulin (IgG/Ig) used for treating patients with immune deficiencies and autoimmune diseases. IgG/Ig is an antibody protein found in blood plasma which is a key part of a person’s immune system for fighting off bacteria, viruses, and fungi. IgG/Ig only accounts for 15% of the blood plasma volume and there is a global shortage, so it is significantly underutilized as a patient therapy. Global demand is estimated to be twice the current supply. IgG/Ig can be administered to a patient via two different methods: intravenous immunoglobulin (IVIG) infusions (medical supervision required), or subcutaneous immunoglobulin (SCIG) infusions (can be self-administered; more convenient but also more expensive for patients). In our opinion, Grifols can benefit not only from the long-term demand growth for IgG/Ig, but also from price inflation as patients migrate from IVIG treatment to the more highly priced SCIG infusions.
Grifols saw its profitability decline in 2020 as it invested in new collection centers to meet rising demand, which hurt its margins (those centers typically take at least two years to get up to scale). The shares underperformed the market in 2020 after not rebounding from their lows in March. We like the company’s strong competitive position and given the depressed profitability, which we believe is temporary in nature, we think the shares offer an attractive long-term appreciation potential at today’s valuation levels.
Other activity in the period included the divestment of our longtime holding, U.K.-based G4S.
G4S is the world’s largest security services provider, with over 500,000 employees in more than 80 countries. The company generates more than half of its revenue from Europe and North America but has a strong presence in emerging markets, which represent one-third of its business. When we first bought the stock in 2014, G4S was in the early stages of a major restructuring. The company had failed to deliver on some large contracts, and deteriorating business performance forced it to raise equity capital in 2013. Throughout our holding period, G4S reduced net debt by 40% through a combination of asset sales and better cash-flow generation. Moreover, the company’s
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operating margins have recovered in the past year, and it appeared the years of restructuring were finally bearing fruit.
The progress, combined with the company’s intention to spin off its cash management business, has made G4S a merger and acquisition target. Over the past several months, two potential acquirers, GardaWorld and Allied Universal Security Services, have bid increasing amounts for G4S. The board of directors at G4S finally agreed to accept a bid from Allied Universal in early December. Following the announcement, G4S’s share price appreciated beyond the acquisition price as many investors were hoping that GardaWorld would make a counteroffer. Given the share-price increase and the availability of other opportunities, the investment committee decided to sell G4S.
During the period we exited from Finnish communication equipment company Nokia after it got caught up in the speculative social media frenzy during the quarter, which led its share price to surge within a short period. Additionally, we sold South Korean auto maker Hyundai Motor after its share price appreciated significantly in the second half of 2020 and reached our estimate of its intrinsic value.
Looking Forward
The Brandes International Equity Fund’s portfolio continues to exhibit more attractive valuations, in our view, than the MSCI EAFE Index, with lower price-to-earnings, price-to-book and price-to-cash flow, as well as a higher dividend yield (all as of March 31, 2021). Many of our holdings also share what we consider appealing attributes, namely solid balance sheets, compelling growth prospects and strong free cash flows.
At the end of March 2021, from a sector perspective, we held our key exposures to financials, health care, energy and consumer staples, while maintaining significantly lower allocations to technology and industrials than the benchmark. On a country/region basis, we continued to have overweight positions in the United Kingdom, France and emerging markets, and underweight positions in Australia and Japan. While our investment decisions are based on company-by-company analysis and not dependent on any index’s compositions, we believe the differences between our portfolio and the benchmark continue to make the Fund an intelligent complement to index-tracking or growth-oriented alternatives.
We believe the Fund is well positioned for a potential value resurgence. During the period, we saw another validation of this as value stocks (the MSCI EAFE Value Index) outperformed the general market (the MSCI EAFE Index), and the Fund did better than the broad benchmark and the value index.
In our opinion, value stocks remain well positioned for the long term given a variety of potential tailwinds, including:
| • | a possible increase in inflation and interest rates; and |
| • | a likely pickup in economic growth as global economies begin to reopen and potentially benefit from government stimulus. |
More importantly, we believe the valuation discounts at which value stocks trade relative to the general market and growth stocks (MSCI EAFE Value vs. MSCI EAFE
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and MSCI EAFE Growth) continue to bode well for value stocks. At the end of the third quarter of 2020 (prior to the value rally), value stocks traded at close to their least expensive percentile relative to growth stocks based on a variety of valuation measures (P/E, P/B, P/CF, Forward P/E, EV/Sales, EV/EBITDA, dividend yield). Following two recent strong quarters, value stocks continue to trade within the least expensive decile relative to growth stocks (as of March 31), which indicates to us that there is still plenty of room for improvement when it comes to value’s return potential.
Given our historical tendency to do even better than the value index whenever that index outperformed the benchmark, combined with the prospects of earnings recoveries for value-oriented companies, we believe the Brandes International Equity Fund is well positioned for long-term return potential.
Thank you for the trust you have placed in us.
Sincerely yours,
The Brandes International Large-Cap Investment Committee
Brandes Investment Trust
Dividend Yield: Dividends per share divided by price per share.
EBITDA: Earnings before interest, taxes, depreciation and amortization.
Enterprise Value (EV): Market capitalization plus debt, minority interest and preferred shares, minus total cash and cash equivalents.
Enterprise Value/EBITDA: Enterprise value divided by earnings before interest, taxes, depreciation and amortization.
Enterprise Value/Sales (EV/S): Enterprise value divided by total company sales.
Forward/Price Earnings (F/PE): Price per share divided by expected earnings per share.
Free Cash Flow: Total cash flow from operations less capital expenditures.
Price/Book (P/B): Price per share divided by book value per share.
Price/Cash Flow (P/CF): Price per share divided by cash flow per share.
Price/Earnings (P/E): Price per share divided by earnings per share.
The margin of safety for any security is defined as the discount of its market price to what the firm believes is the intrinsic value of that security.
Because the values of the Fund’s investments will fluctuate with market conditions, so will the value of your investment in the Fund. You could lose money on your investment in the Fund, or the Fund could underperform other investments. The values of the Fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall economic conditions in the countries where the Fund invests. Emerging country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and
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Brandes International Equity Fund
may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.
Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.
The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.
Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.
Must be preceded or accompanied by a prospectus.
Index Guide
The MSCI EAFE Index with net dividends captures large and mid cap representation of developed market countries excluding the U.S. and Canada.
The MSCI EAFE Value Index with gross dividends captures large and mid cap securities across developed market countries, excluding the United States and Canada, exhibiting value style characteristics, defined using book value to price, 12-month forward earnings to price, and dividend yield.
The MSCI EAFE Growth Index with gross dividends captures large and mid cap securities across developed market countries, excluding the United States and Canada, exhibiting growth style characteristics, defined using long-term forward earnings per share (EPS) growth rate, short-term forward EPS growth rate, current internal growth rate, long-term historical EPS growth trend, and long-term historical sales per share growth trend.
MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.
One cannot invest directly in an index.
The Brandes International Equity Fund is distributed by ALPS Distributors, Inc.
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Brandes International Equity Fund
The following chart compares the value of a hypothetical $100,000 investment in the Brandes International Equity Fund – Class I from March 31, 2011 to March 31, 2021 with the value of such an investment in the MSCI EAFE (Europe, Australasia and Far East) Index for the same period.
Value of $100,000 Investment vs MSCI
EAFE (Europe, Australasia and Far East) Index (Unaudited)
| Average Annual Total Return Periods Ended March 31, 2021 | |||||||
| One Year | Five Years | Ten Years | Since Inception(1) | ||||
| Brandes International Equity Fund | |||||||
Class A* | 53.99% | 6.02% | 4.31% | 7.27% | |||
Class A *(with maximum sales charge) | 45.14% | 4.77% | 3.69% | 7.01% | |||
Class C* | 52.94% | 5.24% | 3.52% | 6.46% | |||
Class C *(with maximum sales charge) | 51.94% | 5.24% | 3.52% | 6.46% | |||
Class I | 54.53% | 6.27% | 4.52% | 7.51% | |||
Class R6* | 54.66% | 6.43% | 4.63% | 7.59% | |||
MSCI EAFE (Europe, Australasia and Far East) Index | 44.57% | 8.85% | 5.52% | 5.12% | |||
| (1) | The inception date is January 2, 1997. |
| * | Performance shown prior to January 31, 2011 for Class A shares reflects the performance of Class I shares adjusted to reflect Class A expenses. Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses. Performance shown prior to February 1, 2016 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses. |
Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than
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Brandes International Equity Fund
their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.
The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Brandes Investment Partners, L.P., the Advisor, has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.
Sector Allocation as a Percentage of Total Investments as of
March 31, 2021 (Unaudited)
The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC.
8
Brandes Global Equity Fund
Dear Fellow Investor,
The net asset value of the Brandes Global Equity Fund (Class I Shares) increased 37.62% in the six months ended March 31, 2021. During the same period, the MSCI World Index increased 19.57%.
Most of the Fund’s strongest contributors were cyclically oriented businesses in the financials and energy sectors. Several of our health care and information technology holdings also performed well.
An overweight allocation to financials benefitted returns, as did our stock selection because our holdings increased in value more than those in the benchmark. In particular, our bank and insurance investments grew materially amid analyst expectations for rising interest rates and an increase in inflation. Leading contributors included U.S. banks, such as Bank of America, Wells Fargo and Citigroup.
Strong performance from the energy sector was driven by our overweight and stock selection, with holdings such as U.S.-based Halliburton and Spain-based Repsol rising significantly in the period. Meanwhile, performance in the health care sector was led by U.S. health care providers and services companies, namely Laboratory Corporation of America (Labcorp), HCA Healthcare, Cigna and Cardinal Health.
Other strong contributors included select U.S.-based holdings, such as flooring company Mohawk Industries and semiconductor equipment company Applied Materials. European media companies such as Publicis Groupe (France) and WPP Plc (United Kingdom) also rose significantly.
Amid the value rally in the period, only a few of the Fund’s holdings declined. These included China-based Alibaba and China Mobile, as well as pharmaceutical firms Merck, Sanofi and GlaxoSmithKline.
Recent Portfolio Activity
New additions to the Fund during the trailing six months included U.S.-based communications software company Amdocs, money center bank JPMorgan Chase, aerospace and defense company General Dynamics, Mexico-based FEMSA (Fomento Economico Mexicano), and OneMain Holdings, the largest non-prime personal loan provider in the United States.
OneMain is the only national, non-prime, branch-based installment lender, with almost 1,500 branches throughout the U.S. and more than a 20% market share of the non-prime personal loan market. It also has a strong omnichannel presence and closed almost half of its loans digitally in 2020. OneMain has a solid capital position and its capital generation over the past year has remained strong: this allowed it to pay two special dividends and it has the potential to pay more in future years. As the economy begins to open up, the company offers an attractive investment opportunity, we believe, because of its growth potential, strong underwriting history and appealing valuation.
Mexican holding company FEMSA is a business that is trading at multi-year valuation lows despite possessing a strong balance sheet. A major portion of FEMSA’s value stems from FEMSA Comercio, which owns OXXO, the largest convenience store chain in Latin America. Other FEMSA assets include stakes in Coca-Cola FEMSA, the largest
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Brandes Global Equity Fund
Coca-Cola bottler worldwide, and in Dutch brewer Heineken. FEMSA normally buys businesses for the long term and focuses on consumer staples distributors.
Though typically viewed as defensive, FEMSA’s stock tumbled after several acquisitions in 2019 and a double-digit same-store sales decline in OXXO in 2020 due to the pandemic. Nonetheless, we believe FEMSA can strengthen the profitability of its new and existing businesses over the longer term, which may improve market sentiment around the company’s growth prospects. With the stock trading at its lowest EV/EBITDA multiple in a decade, we believed it was a worthy entry point for investing in FEMSA.
Other activity in the period included the sale of semiconductor equipment company Applied Materials, which we first bought during the market downturn one year ago. Over our holding period, the stock more than doubled. While our estimate of its intrinsic value increased as global semiconductor capital expenditures expanded, the stock price grew even faster and when it reached our estimate of intrinsic value, we divested our position. Additionally, we exited position in Dutch semiconductor company NXP Semiconductors following its strong performance in 2020.
Lastly, Finnish communications equipment company Nokia became caught up in the speculative social media/trading frenzy of earlier this year, causing its share price to rise dramatically over a short period. We sold our position amid the share-price increase.
Looking Forward
We believe the Fund is well positioned for a potential value resurgence. We saw validation of that conviction as the MSCI World Value exceeded the broad benchmark during the period and the Fund did better than the benchmark and the value index.
We remain optimistic in the return potential of value stocks compared to other styles due to various foreseeable tailwinds. These include increasing inflation and interest rates and a pickup in growth globally as economies start to open and benefit from stimulus funding.
Most importantly, value stocks continue to trade at what we consider attractive discount levels relative to growth stocks. Against a composite ranking of valuation measures (P/E, P/B, P/CF, Forward P/E, EV/Sales, EV/EBITDA, dividend yield) the MSCI World Value Index traded at close to the least expensive percentile at the end of the third quarter of 2020 (prior to the value rally). Following the resurgence of value during the past six months, it remains in the least expensive decile in its history; this is a level that continues to bode well for future returns, in our opinion. The potential for earnings recoveries in value stocks coupled with historically wide valuation discounts is favorable for the future return prospects of the Fund, we believe.
At the end of March 2021, from a sector perspective, our key holdings were in financials, health care, energy and consumer staples. The Fund maintained significantly lower allocations than the benchmark in technology companies. From a country/region perspective, we remained overweight in the United Kingdom, France and emerging markets, and underweight in the United States and Japan. We believe the differences between our portfolio and the broader market continue to make the Fund an intelligent complement to index-tracking or growth-oriented alternatives.
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Brandes Global Equity Fund
In our view, the Brandes Global Equity Fund exhibits more appealing valuations than the MSCI World Index. The Fund’s holdings share a number of what we consider compelling characteristics, including strong balance sheets and free cash flow, as well as attractive growth prospects. We remain excited about the Fund’s potential and appreciate the trust you have placed in us.
Sincerely yours,
The Brandes Global Large-Cap Investment Committee
Brandes Investment Trust
Dividend Yield: Dividends per share divided by price per share.
EBITDA: Earnings before interest, taxes, depreciation and amortization.
Enterprise Value (EV): Market capitalization plus debt, minority interest and preferred shares, minus total cash and cash equivalents.
Enterprise Value/EBITDA: Enterprise value divided by earnings before interest, taxes, depreciation and amortization.
Enterprise Value/Sales (EV/S): Enterprise value divided by total company sales.
Forward/Price Earnings (F/PE): Price per share divided by expected earnings per share.
Free Cash Flow: Total cash flow from operations less capital expenditures.
Price/Book (P/B): Price per share divided by book value per share.
Price/Cash Flow (P/CF): Price per share divided by cash flow per share.
Price/Earnings (P/E): Price per share divided by earnings per share.
The margin of safety for any security is defined as the discount of its market price to what the firm believes is the intrinsic value of that security.
Because the values of the Fund’s investments will fluctuate with market conditions, so will the value of your investment in the Fund. You could lose money on your investment in the Fund, or the Fund could underperform other investments. The values of the Fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall economic conditions in the countries where the Fund invests. Emerging country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.
Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.
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Brandes Global Equity Fund
The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.
Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.
Must be preceded or accompanied by a prospectus.
Index Guide
The MSCI World Index with net dividends captures large and mid cap representation of developed markets.
The MSCI World Value Index with gross dividends captures large and mid cap securities across developed market countries exhibiting value style characteristics, defined using book value to price, 12-month forward earnings to price, and dividend yield.
MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.
One cannot invest directly in an index.
The Brandes Global Equity Fund is distributed by ALPS Distributors, Inc.
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Brandes Global Equity Fund
The following chart compares the value of a hypothetical $100,000 investment in the Brandes Global Equity Fund – Class I from March 31, 2011 to March 31, 2021 with the value of such an investment in the MSCI World Index for the same period.
Value of $100,000 Investment vs MSCI
World Index (Unaudited)
| Average Annual Total Return Periods Ended March 31, 2021 | |||||||
| One Year | Five Years | Ten Years | Since Inception(1) | ||||
| Brandes Global Equity Fund | |||||||
Class A* | 61.77% | 8.79% | 6.61% | 7.14% | |||
Class A *(with maximum sales charge) | 52.46% | 7.50% | 5.99% | 6.63% | |||
Class C* | 60.55% | 7.96% | 5.82% | 6.32% | |||
Class C *(with maximum sales charge) | 59.55% | 7.96% | 5.82% | 6.32% | |||
Class I | 62.17% | 9.05% | 6.88% | 7.39% | |||
MSCI World Index | 54.03% | 13.36% | 9.88% | 10.21% | |||
| (1) | The inception date is October 6, 2008. |
| * | Performance shown prior to January 31, 2011 for Class A shares reflects the performance of Class I shares adjusted to reflect Class A expenses. Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses. |
Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.
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The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Brandes Investment Partners, L.P., the Advisor, has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.
Sector Allocation as a Percentage of Total Investments as of
March 31, 2021 (Unaudited)
The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC.
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Brandes Emerging Markets Value Fund
Dear Fellow Investor,
The net asset value of the Brandes Emerging Markets Value Fund (Class I Shares) increased 26.31% in the six months ended March 31, 2021. During the same period, the MSCI Emerging Markets Index gained 22.43%.
The Fund has benefitted from cyclically oriented and economically sensitive holdings, such as Brazil-based regional jet manufacturer Embraer, Mexican cement company Cemex and Thailand-based Siam Commercial Bank. The positive performance of these companies was mainly driven by their strong free-cash-flow generation and improved business outlook.
Embraer saw its business stabilize amid increased customer aircraft deliveries, resulting in positive cash flow and improving margins. Meanwhile, Cemex experienced its strongest period in many years and announced double-digit profit growth guidance for 2021.
In addition, South Korean based POSCO (Metals & Mining) and Samsung Electronics (Technology Hardware Storage & Peripherals) performed strongly.
Performance detractors during the period included higher education companies Cogna Educacao, India-based Zee Entertainment Enterprises, and Alibaba Group.
Alibaba saw its share price decline after Ant Group, its affiliate digital payment platform company, unexpectedly had its initial public offering (IPO) cancelled due to intervention by the Chinese government. The government not only suspended what would have been the world’s largest IPO, but also subsequently proposed new anti-monopoly regulations, which may jeopardize Ant Group’s lucrative asset-light business model. We have long been cognizant of the risk of government involvement in China’s internet companies and have incorporated this in our evaluation of Alibaba, a company that we believe does not represent a systemic financial risk and in fact plays an important role in the growth of China’s economy. The share price correction essentially wiped out the value we attribute to Alibaba’s stake in Ant Group, making it a “free” option for us. Given its growth potential and competitive position as China’s leading e-commerce firm and one of the world’s largest internet companies, we believe Alibaba offers an attractive risk/reward tradeoff for long-term investors.
Recent Portfolio Activity
New additions to the Fund during the trailing six months included China Education Group, Indonesia-based food products company Indofood, Mexican holding company FEMSA (Fomento Economico Mexicano) and Taiwan-based Largan Precision, the world’s largest manufacturer of camera lenses by revenue and the second largest by volume.
China Education Group (CEG) is the largest publicly traded private higher education operator in China by student enrollment. The strong demand for higher education in China necessitates active participation by the private sector and makes the segment a lucrative and growing market, in our view. Unlike in the K-12 segment, where profitability is restricted due to government concerns about unequal access to basic education, China’s regulations allow higher educational institutions to be for-profit
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entities. We believe CEG offers an attractive business growth potential that is not fully appreciated by the market. The company plans to expand its schools and convert its independent colleges into full private universities, which should increase its appeal among potential students and allow the company to enhance its margins. Additionally, CEG has strong management, provides transparent and good corporate access to investors, and has shown the ability to add value through merger and acquisitions activities. We believe these attributes combine to make CEG a compelling value opportunity for us.
Largan Precision (Taiwan) commands a leading position in the high-end camera lenses segment, from which it has generated exceptional returns with approximately 60% operating margins in recent years. While the global smartphone market has declined slightly over the past few years, a steady increase in the average number of cameras per phone, combined with consistent upgrades in smartphone camera capabilities, has resulted in a stable growth for the camera lens market. This growth is expected to continue in the years ahead and we expect Largan to be able to sustain growth notwithstanding competitors’ increased technological capabilities and aggressive pricing. The company has a number of strengths that should help minimize market share loss and allow it to continue generating attractive returns. It boasts the largest patent portfolio in the industry and what we see as the best manufacturing technology with a vertically integrated business model. Moreover, Largan remains the “go-to” high-end lens supplier for smartphone manufacturers, which enables it to develop and offer leading edge solutions before its competitors.
We also purchased Mexican holding company FEMSA (Fomento Economico Mexicano), a business with a strong balance sheet which is trading at multi-year valuation lows. A major portion of FEMSA’s value stems from FEMSA Comercio, which owns OXXO, the largest convenience store chain in Latin America. Other FEMSA assets include stakes in Coca-Cola FEMSA, the largest Coca-Cola bottler worldwide, and in Dutch brewer Heineken. FEMSA normally buys businesses for the long term and focuses on consumer staples distributors. Though typically viewed as defensive, FEMSA’s stock tumbled after several acquisitions in 2019 and a double-digit same-store sales decline in OXXO in 2020 due to the pandemic. Nonetheless, we believe FEMSA can strengthen the profitability of its new and existing businesses over the longer term, which may improve market sentiment around the company’s growth prospects. With the stock trading at its lowest EV/EBITDA multiple in a decade, we believed it was a worthy entry point for investing in FEMSA.
Other activity in the period included the divestments of Russia-based diamond company Alrosa and Taiwanese Asustek Computer, as well as China-based Baidu and China Mobile. We sold Alrosa, Asustek and Baidu as the shares appreciated to our estimates of their intrinsic values. Meanwhile, we exited our position in China Mobile due to a change in its non-investment related risk profile. In January 2021, the New York Stock Exchange delisted China Mobile to comply with an executive order by then President Donald Trump barring U.S. investments in Chinese companies with links to the military.
16
Brandes Emerging Markets Value Fund
Looking Forward
At the end of March 2021, the Brandes Emerging Markets Value Fund held its largest sector weightings in financials and consumer discretionary, and maintained key underweights to technology and materials. From a country perspective, even though Chinese companies made up our largest allocation, we were still significantly underweight the country. Additionally, we had lower weighting to Taiwanese companies than the benchmark. While our investment decisions are based on company-by-company analysis and not dependent on any index’s compositions, the differences between our value-oriented portfolio and the benchmark make the Fund a potential complement to index-tracking and growth-oriented alternatives.
As the pandemic has created significant uncertainty for businesses, we have applied conservative assumptions in estimating the intrinsic values of our holdings. We believe the Fund is well positioned to benefit from potential post-Covid economic recoveries in emerging markets (EM) outside China, Taiwan, and South Korea (three countries that have a “near Covid-free” status). Additionally, the Fund maintains a diversified exposure to what we consider attractively priced value opportunities, including companies with underappreciated growth potential, high dividend yields or those that are undergoing temporary setbacks. Before the positive news regarding Covid-19 vaccines broke in November, our analysts saw good operating results from our holdings which were not followed by major price movements for these securities. The Fund’s performance could get a lift with continued improvement in the fundamentals of our holdings and a re-rating of the companies’ multiples. Additionally, the potential strengthening of EM currencies against the U.S. dollar is another potential catalyst for the Fund’s future returns.
After a strong six-month period, value stocks (as represented by MSCI EM Value) remain attractive, in our opinion, for the long term given a variety of potential tailwinds, including:
| • | an increase in inflation and interest rates; |
| • | pickup in economic growth as global economies begin to reopen and potentially benefit from government stimulus; and |
| • | the prospect of increased government regulation of technology companies, which make up a meaningful portion of growth indices (e.g., 25% of MSCI EM Growth vs. 17% of MSCI EM Value as of March 31). |
More importantly, we believe the valuation discounts at which value stocks trade relative to growth stocks (MSCI EM Value vs. MSCI EM Growth, based on price/book, price/earnings and price/cash flow) continue to bode well for value stocks.
We remain excited about the prospects of the Brandes Emerging Markets Value Fund and thank you for your continued trust.
Sincerely yours,
The Brandes Emerging Markets Investment Committee
Brandes Investment Trust
Dividend Yield: Dividends per share divided by price per share.
17
Brandes Emerging Markets Value Fund
EBITDA: Earnings before interest, taxes, depreciation and amortization.
Enterprise Value (EV): Market capitalization plus debt, minority interest and preferred shares, minus total cash and cash equivalents.
Enterprise Value/EBITDA: Enterprise value divided by earnings before interest, taxes, depreciation and amortization.
Forward/Price Earnings (F/PE): Price per share divided by expected earnings per share.
Free Cash Flow: Total cash flow from operations less capital expenditures.
Price/Book (P/B): Price per share divided by book value per share.
Price/Cash Flow (P/CF): Price per share divided by cash flow per share.
Price/Earnings (P/E): Price per share divided by earnings per share.
The margin of safety for any security is defined as the discount of its market price to what the firm believes is the intrinsic value of that security.
Because the values of the Fund’s investments will fluctuate with market conditions, so will the value of your investment in the Fund. You could lose money on your investment in the Fund, or the Fund could underperform other investments. The values of the Fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall economic conditions in the countries where the Fund invests. Emerging markets involve greater risk and volatility than more developed markets. Some emerging markets may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than investments in larger capitalization companies. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.
Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.
The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.
Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.
Must be preceded or accompanied by a prospectus.
18
Brandes Emerging Markets Value Fund
Index Guide
The MSCI Emerging Markets Index with net dividends captures large and mid cap representation of emerging market countries.
The MSCI Emerging Markets Value Index with gross dividends captures large and mid cap securities exhibiting value style characteristics, defined using book value to price, 12-month forward earnings to price, and dividend yield.
The MSCI Emerging Markets Growth Index with gross dividends captures large and mid cap securities exhibiting growth style characteristics, defined using long-term forward earnings per share (EPS) growth rate, short-term forward EPS growth rate, current internal growth rate, long-term historical EPS growth trend, and long-term historical sales per share growth trend.
MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.
One cannot invest directly in an index.
The Brandes Emerging Markets Value Fund is distributed by ALPS Distributors, Inc.
19
Brandes Emerging Markets Value Fund
The following chart compares the value of a hypothetical $100,000 investment in the Brandes Emerging Markets Value Fund – Class I from March 31, 2011 to March 31, 2021 with the value of such an investment in the MSCI Emerging Markets Index for the same period.
Value of $100,000 Investment vs MSCI
Emerging Markets Index (Unaudited)
| Average Annual Total Return Periods Ended March 31, 2021* | |||||||
| One Year | Five Years | Ten Years | Since Inception(1) | ||||
| Brandes Emerging Markets Value Fund | |||||||
Class A | 47.25% | 5.99% | 0.77% | 6.70% | |||
Class A (with maximum sales charge) | 38.78% | 4.75% | 0.18% | 6.45% | |||
Class C** | 46.25% | 5.22% | 0.04% | 5.88% | |||
Class C **(with maximum sales charge) | 45.25% | 5.22% | 0.04% | 5.88% | |||
Class I | 47.66% | 6.24% | 1.03% | 6.94% | |||
Class R6** | 47.79% | 6.40% | 1.14% | 7.02% | |||
MSCI Emerging Markets Index | 58.39% | 12.07% | 3.65% | 6.70% | |||
| (1) | The inception date is August 20, 1996. |
| * | Prior to January 31, 2011, the Advisor managed a private investment fund with an investment objective, investment policies and strategies that were, in all material respects, equivalent to those of the Brandes Emerging Markets Value Fund. The performance information shown for the Class I shares for periods before January 31, 2011 is that of the private investment fund and reflects the net expenses of the private investment fund. The performance of the private investment fund prior to January 31, 2011 is based on a calculation method that is different from the standardized calculation method prescribed by the SEC. The performance information shown for the Class A shares has been adjusted to reflect the differences in the net expense ratios between the Class I and A shares. The private investment fund was not registered under the Investment Company Act of 1940 (“1940 Act”) and was not subject to certain investment |
20
Brandes Emerging Markets Value Fund
| limitations, diversification requirements, and other restrictions imposed by the 1940 Act and the Internal Revenue Code of 1986, which, if applicable, may have adversely affected its performance. | |
| ** | Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses. Performance shown prior to July 11, 2016 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses. |
Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.
The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Brandes Investment Partners, L.P., the Advisor, has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.
Sector Allocation as a Percentage of Total Investments as of
March 31, 2021 (Unaudited)
The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC.
21
Brandes International Small Cap Equity Fund
Dear Fellow Investor,
The net asset value of the Brandes International Small Cap Equity Fund (Class I Shares) advanced 38.20% in the six months ended March 31, 2021. During the same period, the S&P Developed Ex-U.S. SmallCap Index advanced 23.01%.
The Fund benefited from holdings in the cyclically oriented industrials, financials, materials and energy sectors. Notable performers included U.K. facilities management company MITIE Group, Brazilian regional jet manufacturer Embraer, and Mexican cement producer Cemex. The strong performance of these companies was mainly driven by their earnings recoveries and optimistic profit guidance.
MITIE announced strong momentum in its Business Services segment and enjoyed an improvement in the discretionary projects within its Technical Services segment. The company also provided positive guidance for continued recovery in its profitability. Similarly, Cemex experienced its strongest period in many years and issued double-digit profit growth guidance for 2021. Meanwhile, Embraer saw its business stabilize amid increased customer aircraft deliveries, resulting in positive cash flow and improving margins.
Additionally, Irish bank AIB Group saw its share price rebound in late 2020. Banks around the world, including AIB, had faced a major headwind to their earnings for much of 2020 as new accounting rules required them to provision up front for expected loan losses. However, an improved economic outlook led to a drop in loan loss provisioning expectations, which helped alleviate investor concern.
Other notable contributors included Funai Electric, which was up significantly following its announced acquisition by Shuwa System Holdings at a total acquisition price of ¥25.6 billion. We sold our position in Funai Electric on the news.
From a geographic standpoint, the Fund saw strong contribution from its exposure to Europe, including the United Kingdom, Ireland and Spain.
Conversely, returns for the period were hampered by Chinese machinery company China Yuchai International Limited, Japanese machinery company Komori Corporation, and several Japanese banks, namely Kyushu Financial Group, Hachijuni Bank, Oita Bank and Hyakugo Bank. These Japanese financial companies did not participate in the fourth-quarter rally as investors seemed concerned about the post-COVID time to recovery of the Japanese economy in general and did not react strongly to the Bank of Japan’s announced negative rates exemptions.
Recent Portfolio Activity
During the trailing six-month period, the investment committee initiated a position in Canadian insurance company E-L Financial.
E-L Financial is a company we are very familiar with, having held it in the Fund as recently as 2018. The firm operates as an investment and insurance holding company and is effectively an extension of the Jackman family estate. The Jackman family owns an approximately 73% interest in E-L and has compounded book value per share at an
22
Brandes International Small Cap Equity Fund
annual rate of 12% for nearly 50 years. In 2012, E-L sold its property & casualty insurance company to Travelers and used some of the proceeds to pay a special dividend to shareholders, while reinvesting the remainder in global equities. In 2015, E-L acquired the 19% minority interest in Canadian life insurer Empire Life at 1x book value. The investment has since generated 8-10% return on equity annually, and it accounts for a meaningful percentage of our intrinsic value estimate for E-L, with the remainder comprising a diversified, global equity portfolio managed by value-oriented asset managers.
E-L’s shares have been under pressure due to pandemic-related concerns. We believe that this headwind is temporary in nature and that E-L’s shares have the potential to recover given the company’s strong balance sheet and savvy management team. At its current valuation levels, E-L represents an appealing risk/reward tradeoff for us.
Several holdings were sold from the Fund in the period, such as Funai Electric (as noted above) and Latin American agriculture company Adecoagro, as well as U.K. real estate firm Countrywide and security services provider G4S.
G4S is the world’s largest security services provider, with over 500,000 employees in more than 80 countries. The company generates more than half of its revenue from Europe and North America but has a strong presence in emerging markets, which represent one-third of its business. When we first bought the stock in 2018, G4S was in the midst of a major restructuring. The company had failed to deliver on some large contracts, and deteriorating business performance had forced it to raise equity capital a few years prior. In the last several years, G4S reduced net debt by 40% through a combination of asset sales and better cash-flow generation. Moreover, the company’s operating margin has recovered in the past year, and it appeared the major restructuring was finally bearing fruit.
Despite this progress, the share price declined in the first half of last year, prompting rival GardaWorld to approach G4S with an acquisition offer. The offer was rejected, but it led to a competitive bidding process for G4S. In early December, the board of directors agreed to accept a bid from Allied Universal and the share price appreciated beyond the acquisition price on the announcement as many investors were hoping that GardaWorld would make a counteroffer. Ultimately, GardaWorld did not increase its bid and an adequate number of shareholders approved the offer from Allied Universal in March 2021.
Other activity included the full sells of U.K.-based internet company Telit Communications and South Korean auto components manufacturer Hankook Tire & Technology, which both appreciated to our estimates of their intrinsic values on a strong second half of 2020 after reaching lows in early April 2020. While Telit was a long-time holding in the Fund, Hankook was one of the positions that we initiated by taking advantage of the market drawdown in the first quarter of 2020, during which the onset of the pandemic disproportionately affected the share prices of select companies with strong fundamentals.
23
Brandes International Small Cap Equity Fund
Looking Forward
At quarter end March 31, 2021, the Fund held its largest allocations to consumer staples, financials and industrials, while maintaining key underweights in information technology and materials. From a country standpoint, we continued to find value potential in the United Kingdom and Japan. Attractive value opportunities also persist in emerging markets, which accounted for over 25% of the Fund as of March 31.
After a strong period, value stocks remain attractive, in our opinion, for the long term given a variety of potential tailwinds, including:
| • | a probable increase in inflation and interest rates; and |
| • | a likely pickup in economic growth as global economies begin to reopen and potentially benefit from government stimulus. |
More importantly, we believe the valuation discounts at which value stocks trade relative to growth stocks continue to bode well for value stocks (S&P Developed ex-U.S. SmallCap Value vs. S&P Developed ex-U.S. SmallCap Growth, based on price/book, price/earnings and price/cash flow). Given our historical tendency to do even better than the value index when that index outperformed the benchmark, combined with the prospects of earnings recoveries for value-oriented companies, we believe the Brandes International Small Cap Equity Fund is well positioned for long-term return potential.
Thank you for the trust you have placed in us.
Sincerely yours,
The Brandes Small-Cap Investment Committee
Brandes Investment Trust
Book Value: Assets minus liabilities. Also known as shareholders’ equity.
Cash Flow: The amount of cash generated minus the amount of cash used by a company in a given period.
Dividend Yield: Dividends per share divided by price per share.
Forward/Price Earnings (F/PE): Price per share divided by expected earnings per share.
Operating Margin: Operating income divided by net sales; used to measure a company’s operating efficiency.
Price/Book (P/B): Price per share divided by book value per share.
Price/Cash Flow (P/CF): Price per share divided by cash flow per share.
Price/Earnings (P/E): Price per share divided by earnings per share.
Return on Equity: Net income divided by shareholders' equity.
The margin of safety for any security is defined as the discount of its market price to what the firm believes is the intrinsic value of that security.
24
Brandes International Small Cap Equity Fund
Because the values of the Fund’s investments will fluctuate with market conditions, so will the value of your investment in the Fund. You could lose money on your investment in the Fund, or the Fund could underperform other investments. The values of the Fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall economic conditions in the countries where the Fund invests. Emerging country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than investments in larger capitalization companies. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.
Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.
The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.
Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.
Must be preceded or accompanied by a prospectus.
Index Guide
The S&P Developed Ex-U.S. SmallCap Index with net dividends measures the equity performance of small-capitalization companies from developed markets excluding the United States.
The S&P Developed Ex U.S. SmallCap Value Index with net dividends measures the equity performance of small cap companies in developed markets excluding the United States, which are classified as value stocks by book value-to-price, sales-to-price, cash flow-to-price, and dividend yield.
The S&P Developed Ex U.S. SmallCap Growth Index with net dividends measures the equity performance of small cap companies in developed markets excluding the United States, which are classified as growth stocks by sales growth, earnings change-to-price, and momentum.
One cannot invest directly in an index.
The Brandes International Equity Small Cap Equity Fund is distributed by ALPS Distributors, Inc.
25
Brandes International Small Cap Equity Fund
The following chart compares the value of a hypothetical $100,000 investment in the Brandes International Small Cap Fund – Class I from March 31, 2011 to March 31, 2021 with the value of such an investment in the S&P Developed Ex-U.S. SmallCap Index for the same period.
Value of $100,000 Investment vs S&P Developed
Ex-U.S. SmallCap Index (Unaudited)
| Average Annual Total Return Periods Ended March 31, 2021* | |||||||
| One Year | Five Years | Ten Years | Since Inception(1) | ||||
| Brandes International Small Cap Equity Fund | |||||||
Class A | 64.61% | 3.07% | 4.99% | 8.59% | |||
Class A (with maximum sales charge) | 55.15% | 1.86% | 4.37% | 8.33% | |||
Class C** | 63.36% | 2.30% | 4.21% | 7.78% | |||
Class C **(with maximum sales charge) | 62.36% | 2.30% | 4.21% | 7.78% | |||
Class I | 64.76% | 3.28% | 5.21% | 8.84% | |||
Class R6** | 64.94% | 3.40% | 5.30% | 8.91% | |||
S&P Developed Ex-U.S. SmallCap Index | 66.31% | 10.14% | 7.17% | 7.16% | |||
| (1) | The inception date is August 19, 1996. |
| * | Prior to February 1, 2012, the Advisor managed a private investment fund with an investment objective, investment policies and strategies that were, in all material respects, equivalent to those of the Brandes International Small Cap Fund. The performance information shown for the Class I shares for periods before February 1, 2012 is that of the private investment fund and reflects the net expenses of the private investment fund. The performance of the private investment fund prior to February 1, 2012 is based on a calculation method that is different from the standardized calculation method prescribed by the SEC. The performance information shown for the Class A shares has been adjusted to reflect the differences in the net expense ratios between the Class I and A shares. The private investment fund was not registered under the Investment Company Act of 1940 (“1940 Act”) and was not subject to certain investment |
26
Brandes International Small Cap Equity Fund
| limitations, diversification requirements, and other restrictions imposed by the 1940 Act and the Internal Revenue Code of 1986, which, if applicable, may have adversely affected its performance. | |
| ** | Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses. Performance shown prior to June 27, 2016 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses. |
Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.
The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Brandes Investment Partners, L.P., the Advisor, has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.
Sector Allocation as a Percentage of Total Investments as of
March 31, 2021 (Unaudited)
The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC.
27
Brandes Small Cap Value Fund
Dear Fellow Investor,
The net asset value of the Brandes Small Cap Value Fund (Class I Shares) rose 47.99% in the six months ended March 31, 2021. During the same period, the Russell 2000 Index rose 48.05%.
The Fund’s top contributors included several cyclically oriented companies. From an industry perspective, Fund holdings in energy equipment & services, aerospace & defense, and insurance were solid contributors to performance.
Energy equipment and services companies Helmerich & Payne and Halliburton were among the largest individual contributors to performance in the period, as were oil and gas producer Chesapeake Energy and regional jet manufacturer Embraer. Among our bank and insurance holdings, notable contributors included Northrim BanCorp, Crawford & Company and American National Bankshares. These companies saw their share prices rise on increased expectations of rising U.S. interest rates and inflation.
Furthermore, the Fund’s holdings in the information technology sector also performed well, led by business intelligence software business MicroStrategy.
MicroStrategy announced strong business growth and continued to improve sales execution while managing its costs. MicroStrategy’s returns were also driven by its announcement that it would make bitcoin its primary treasury reserve asset. In late December, MicroStrategy announced that it had made more than $1 billion in bitcoin purchases in 2020. Given the company’s share price appreciation and the complete change in MicroStrategy’s risk/return profile, we sold out of our position during the fourth quarter.
Amid the value rally, only a few holdings declined in the period.
While our health care investments added to aggregate returns, a few fared poorly, including health care equipment manufacturers LENSAR and Utah Medical Products, as well as biotech firm PDL BioPharma.
Recent Portfolio Activity
During the trailing six months through March 31, 2021, the small cap investment committee initiated several new positions, including food retailer Ingles Markets, regional bank ACNB Corporation and health care company Mednax.
Mednax (MD) is a physician services company that offers services to women’s and children’s specialty units in hospitals. Following pressure from Starboard (which owns approximately 10% of Mednax) for its lagging margins and poor overall performance, the company recently divested its anesthesiology and radiology units; the segments sold contributed $1.265 billion (36% of total revenues) and $492 million (14%) of revenue in 2019, respectively.
Mednax has now reverted to its roots and provides mainly neonatology (approximately 85% of post-divestiture revenues), maternal-fetal medicine (MFM) services and
28
Brandes Small Cap Value Fund
pediatric cardiology. The company’s long-term strategy is to increase its share in the neonatal segment, while expanding peripheral businesses, such as MFM and pediatrics, that are synergistic to its sales efforts. In neonatology, Mednax currently has approximately 25% market share, up from 18.4% in 2011. It is also the largest national women’s and children’s provider group—10x bigger than its closest peer.
Mednax differs from a typical staffing/placement company because it buys physician practices and hospital contracts in exchange for providing reimbursement negotiations, staffing, professional liability protection, and compliance with regulations. It thereby realizes economies of scale as the administrative functions it oversees can cover more clinicians: this grants it bargaining power with hospitals and physicians.
The business’s key value drivers are its contracts with hospitals and the staffing of hospital specialty units with physicians. Traditionally, hospitals staff these units through local physician groups, which leads to administrative burdens. Mednax’s strategy is to add value by managing the operational side, providing staffing and optimizing systems with data analytics. It charges administrative fees to its hospital partners and seeks to profit from margin growth opportunities through improved efficiency in physician practices.
Mednax’s operating performance has been poor over the past five years as margins declined to 11.6% in 2019 from 22.3% in 2010, mainly due to the anesthesiology business which it recently sold off. The core women’s and children’s business was also negatively affected by a decline in birth rates, a lower percentage of revenue from the high margin neonatology business, and wage inflation outpacing reimbursement. With these recent divestments, Mednax is targeting long-term revenue growth of 6% and “high-teens” margins.
The restructuring following the sale of its anesthesiology and radiology businesses in 2020 has made Mednax’s balance sheet more manageable. We believe the company offers a regrowth story—focused on its core children and women’s health business—that is underappreciated by the market.
Given strong market appreciation, sales activity was elevated. We sold a number of securities after they appreciated to our intrinsic value estimates, including MicroStrategy (as mentioned above), Florida-based land developer St. Joe, AMAG Pharmaceuticals and machinery business Greenbrier Companies. Other sales included the Fund’s positions in Mohawk Industries, American National Bankshares, and Sensient Technologies (a manufacturer and marketer of colors, flavors and fragrances), after each appreciated to our estimate of its intrinsic value.
Looking Forward
After a strong period of value performance, we remain optimistic in the return potential of value stocks compared to other styles due to various potential tailwinds. These include increasing inflation and interest rates and a pickup in growth from global economies starting to open and benefitting from stimulus funding. Most importantly,
29
Brandes Small Cap Value Fund
from a value investor perspective, the valuation discount of value stocks relative to growth stocks remains compelling (as measured by the MSCI USA Small Cap Value Index versus MSCI USA Small Cap Growth Index).
We continued to find value potential in more cyclically oriented sectors such as industrials and energy, while being underweight to consumer discretionary and information technology. We believe the differences between the Brandes Small Cap Value Fund and the broader market continue to make the Fund an attractive complement to other small-cap offerings. The Fund exhibits more appealing valuations, in our view, than the Russell 2000 indices and our holdings feature what we consider to be strong balance sheets, compelling growth prospects and durable free cash flow.
As always, we appreciate the trust you have placed in us.
Sincerely yours,
The Brandes Small-Cap Investment Committee
Brandes Investment Trust
Dividend Yield: Dividends per share divided by price per share.
Free Cash Flow: Total cash flow from operations less capital expenditures.
The margin of safety for any security is defined as the discount of its market price to what the firm believes is the intrinsic value of that security.
Dividends are not guaranteed and companies currently paying dividends can stop paying dividends without notice.
Because the values of the Fund’s investments will fluctuate with market conditions, so will the value of your investment in the Fund. You could lose money on your investment in the Fund, or the Fund could underperform other investments. The values of the Fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than investments in larger capitalization companies. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.
Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.
The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.
Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.
30
Brandes Small Cap Value Fund
Must be preceded or accompanied by a prospectus.
Index Guide
The Russell 2000 Index with gross dividends measures the performance of the small cap segment of the U.S. equity universe.
The MSCI USA Small Cap Growth Index captures small cap securities exhibiting overall growth style characteristics across U.S. equity markets. The attributes for growth index construction are long-term forward earnings per share (EPS) growth rate, short-term forward EPS growth rate, current internal growth rate, long-term historical EPS growth trend, and long-term historical sales per share growth trend.
The MSCI USA Small Cap Value Index captures small cap securities exhibiting overall value style characteristics across U.S. equity markets. The attributes for value index construction are book value-to-price ratio, 12-months forward earnings-to-price ratio, and dividend yield.
MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.
One cannot invest directly in an index.
The Brandes Small Cap Value Fund is distributed by ALPS Distributors, Inc.
31
Brandes Small Cap Value Fund
The following chart compares the value of a hypothetical $100,000 investment in the Brandes Small Cap Value Fund – Class I from March 31, 2011 to March 31, 2021 with the value of such an investment in the Russell 2000 Total Return Index and Russell 2000 Value Total Return Index for the same period.
Value of $100,000 Investment vs Russell 2000 Total
Return Index & Russell 2000 Value Total
Return Index(Unaudited)
| Average Annual Total Return Periods Ended March 31, 2021* | |||||||
| One Year | Five Years | Ten Years | Since Inception(1) | ||||
| Brandes Small Cap Value Fund | |||||||
Class A | 82.23% | 12.86% | 11.81% | 7.65% | |||
Class A (with maximum sales charge) | 71.79% | 11.54% | 11.15% | 7.38% | |||
Class I | 82.75% | 13.19% | 12.09% | 7.92% | |||
Class R6** | 83.39% | 11.78% | 11.39% | 7.63% | |||
Russell 2000 Total Return Index | 94.85% | 16.35% | 11.68% | 8.41% | |||
Russell 2000 Value Total Return Index | 97.05% | 13.56% | 10.06% | 8.75% | |||
| (1) | The inception date is September 30, 1997. |
| * | Prior to January 2, 2018, the Advisor managed a private investment fund with an investment objective, investment policies and strategies that were, in all material respects, equivalent to those of the Brandes Small Cap Value Fund. The performance information shown for the Class I shares for periods before January 2, 2018 is that of the private investment fund and reflects the net expenses of the private investment fund. The performance of the private investment fund prior to January 2, 2018 is based on a calculation method that is different from the standardized calculation method prescribed by the SEC. The performance information shown for the Class A shares has been adjusted to reflect the differences in the net expense ratios between the Class I and A shares. |
| ** | Performance shown prior to January 2, 2018 for Class R6 shares reflects the performance of Class I shares. The private investment fund was not registered under the Investment Company Act of 1940 (“1940 Act”) |
32
Brandes Small Cap Value Fund
| and was not subject to certain investment limitations, diversification requirements, and other restrictions imposed by the 1940 Act and the Internal Revenue Code of 1986, which, if applicable, may have adversely affected its performance. |
Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.
The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Brandes Investment Partners, L.P., the Advisor, has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.
Sector Allocation as a Percentage of Total Investments as of
March 31, 2021 (Unaudited)
The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC.
33
Brandes Core Plus Fixed Income Fund
Dear Fellow Investor,
In the six months ended March 31, 2021, the Brandes Core Plus Fixed Income Fund (Class I Shares) declined 1.08%, but outperformed its benchmark, the Bloomberg Barclays U.S. Aggregate Bond Index, which declined 2.73%.
For fixed-income investors, the recent story has been the upward bounce in interest rates, which led to negative total returns across most fixed-income asset classes. We were bemused to hear several market talking heads discuss dramatically higher rates and the implications for economic growth and recovery. What was scarcely discussed was that even with the 10-year U.S. Treasury rate’s move higher in March 2021, it is still in the 96th percentile of the 10-year Treasury rate data over the last 50 years.1 In other words, interest rates remain historically low.
There appear to be two drivers of higher rates.
First, the market is pricing in robust growth from an economy that is reopening at greater speed, continued unprecedented accommodative monetary policy from the Federal Reserve (Fed) and fiscal stimulus from the federal government.
The second driver of higher rates is the expectation that long-dormant inflation will begin to pick up steam. There are several fundamental factors behind this expectation, including:
| • | enormous central-bank and fiscal accommodation; |
| • | pandemic-related supply chain bottlenecks; |
| • | de-globalization of supply chains in response to pandemic-related disruptions and shortages; |
| • | increasing commodity price pressures; and |
| • | U.S. savings rate near a 60-year high, indicating strong pent-up demand. |
Additionally, a key factor driving inflation expectations is the Fed’s apparent resolve to continue showering the market with liquidity until inflation runs above its 2% target.
Demand for new issues has remained robust and the reach for yield has shown few signs of abating. For example, Carnival Cruise Lines came to the bond market with the intent of raising $2.5 billion in new debt in the first quarter of 2021. Demand was so strong for the issue that Carnival was able to upsize the offering to $3.5 billion. With the new issuance, the company has now raised $11 billion in new debt since the onset of COVID-19 has left all of the company’s ships in port and current Center for Disease Control and Prevention guidance continues to keep ships docked until this fall. Carnival also reported a net loss of $2 billion in the first quarter 2021 and is currently burning through approximately $500 million in cash per month.
1 Source: Bloomberg, based on weekly data from the last 50 years; as of 3/31/2021.
34
Brandes Core Plus Fixed Income Fund
Holdings in corporate bonds contributed to positive relative returns during the period. Energy holdings were the top contributors as the global reflation trade (i.e., those issuers expected to benefit from policies enacted after an economic slowdown) saw a strong bounce back in the price of oil. Moreover, holdings in other economically sensitive sectors such as lodging and automotive contributed to relative returns.
Term-structure positioning also boosted Fund returns as interest rates with maturities beyond five years moved sharply higher. The Fund was positioned near the bottom of its duration-controlled band during the quarter.
Our underweight to agency Mortgage-Backed Securities (“MBS”) detracted from returns. Agency MBS continues to be supported by direct Fed purchases of approximately $40 billion/month. Agency MBS offer negligible yield pick-up versus U.S. Treasury securities but continue to perform well since the Fed announced its unlimited market support in March 2020.
Recent Portfolio Activity
The Fund added new positions in T-Mobile (maturing 2/1/28, rated Ba3/BB), Continental Resources (maturing 4/15/23 and 1/15/28, rated Ba1/BB+), Avon Products (maturing 3/15/23, rated Ba3/BB-), Netflix (maturing 11/15/26, rated Ba3/BB+), Ford Motor Credit (maturing 11/1/22 and 11/13/25, rated Ba2/BB+) and Pilgrim’s Pride (maturing 9/30/27 and 4/15/31, rated B1/BB+). We also added to our existing holding in Telecom Italia (maturing 11/15/33, rated Ba2/BB+).
In our view, the consistent theme with the newly added positions is that they offer stronger longer-term credit profiles than the rating agencies are currently giving them credit. These holdings should also be less sensitive to interest-rate movements as their credit profiles exhibit positive correlation to the economic recovery.
Finally, our purchase of Pilgrim’s Pride 2031 maturity was a sustainability bond. The bond indenture includes specific metrics that the company must hit with respect to greenhouse gas emissions. If these benchmarks are not hit, the coupon on the bond steps up to a higher coupon.
Outlook
Bond and stock markets have grown to love accommodative central banks and appear to be sanguine about rising fiscal debt levels. It seems many have come to believe that debt levels don’t matter. Maybe we are old fashioned, but we feel it’s difficult to subscribe to the belief that overall debt levels don’t matter. Therefore, we continue to bias the Fund in what we believe is a defensive manner.
In this environment, the Brandes Core Plus Fixed Income Fund continues to favor shorter-maturity corporate bonds and those that exhibit strong, tangible asset coverage, in our view. We are underweight agency MBS and managing duration toward the shorter end of our duration-controlled range. We have a higher allocation to U.S. Treasuries that we will look to redeploy thoughtfully and efficiently—if and when
35
Brandes Core Plus Fixed Income Fund
market uncertainty and volatility cause credit fundamentals to become mispriced from our estimates of intrinsic value.
As always, thank you for your business and continued trust.
Sincerely yours,
The Brandes Fixed Income Investment Committee
Brandes Investment Trust
Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general bond market and economic conditions. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than large capitalization companies.
As with most fixed income funds, the income on and value of your shares in the fund will fluctuate along with interest rates. When interest rates rise, the market prices of the debt securities the fund owns usually decline. When interest rates fall, the prices of these securities usually increase. Generally, the longer the fund’s average portfolio maturity and the lower the average quality of its portfolio, the greater the price fluctuation. The price of any security owned by the fund may also fall in response to events affecting the issuer of the security, such as its ability to continue to make principal and interest payments or its credit rating. Below investment grade debt securities are speculative and involve a greater risk of default and price change due to changes in the issuer’s creditworthiness than higher grade debt. The market prices of these debt securities may fluctuate more than the market prices of investment grade debt securities and may decline significantly in periods of general economic difficulty.
Past performance is not a guarantee of future results.
Short-term debt refers to fixed income securities set to mature in 1 to 5 years from the issue or purchase date. Long-term debt refers to fixed income securities set to mature more than 10 years from the issue or purchase date.
Credit ratings are measured on a scale that generally ranges from AAA (highest) to D (lowest). All Fund securities except for those labeled “Not Rated” and “Other” have been rated by Moody’s, S&P or Fitch, which are each a Nationally Recognized Statistical Rating Organization (“NRSRO”). All Index securities except for those labeled “Not Rated” have been rated by Moody’s or S&P. Credit ratings are subject to change.
Duration: The weighted maturity of a fixed-income investment’s cash flows, used in the estimation of the price sensitivity of fixed-income securities for a given change in interest rates.
Coupon: The annual interest rate paid on a bond.
36
Brandes Core Plus Fixed Income Fund
Mortgage-Backed Security: A type of asset-backed security which is secured by a mortgage or collection of mortgages.
Yield: Annual income from the investment (dividend, interest, etc.) divided by the current market price of the investment.
Asset Coverage: Measures how well a company can repay its debts by selling or liquidating its assets.
Indenture: A legal and binding contract between a bond issuer and bondholder.
Term Structure of Interest Rates: A graph that plots different yields offered by bonds of different maturities.
Total Return: Income plus capital appreciation.
The margin of safety for any security is defined as the discount of its market price to what the firm believes is the intrinsic value of that security.
Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.
The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.
Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.
Must be preceded or accompanied by a prospectus.
Index Guide
The Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market. This index is a total return index which reflects the price changes and interest of each bond in the index.
One cannot invest directly in an index.
The Brandes Core Plus Fixed Income Fund is distributed by ALPS Distributors, LLC.
37
Brandes Core Plus Fixed Income Fund
The following chart compares the value of a hypothetical $100,000 investment in the Brandes Core Plus Fixed Income Fund – Class I from March 31, 2011 to March 31, 2021 with the value of such an investment in the Bloomberg Barclays U.S. Aggregate Bond Index for the same period.
Value of $100,000 Investment vs Bloomberg Barclays
U.S. Aggregate Bond Index (Unaudited)
| Average Annual Total Return Periods Ended March 31, 2021 | |||||||
| One Year | Five Years | Ten Years | Since Inception(1) | ||||
| Brandes Core Plus Fixed Income Fund | |||||||
Class A* | 2.54% | 2.86% | 3.19% | 3.46% | |||
Class A *(with maximum sales charge) | -1.30% | 2.07% | 2.79% | 3.16% | |||
Class I | 2.74% | 3.13% | 3.51% | 3.77% | |||
Class R6* | 3.97% | 3.77% | 3.85% | 4.04% | |||
Bloomberg Barclays U.S. Aggregate Bond Index | 0.71% | 3.10% | 3.44% | 3.98% | |||
| (1) | The inception date is December 28, 2007. |
| * | Performance shown prior to January 31, 2013 for Class A shares reflects the performance of Class I shares adjusted to reflect Class A expenses. Performance shown prior to October 10, 2017 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses. |
Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.
38
Brandes Core Plus Fixed Income Fund
The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of Fund shares. Brandes Investment Partners, L.P., the Advisor, has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.
Asset Allocation as a Percentage of Total Investments as of
March 31, 2021 (Unaudited)
39
Brandes Investment Trust
Expense Example (Unaudited)
As a shareholder of a Fund, you incur ongoing costs, including investment advisory and administrative fees and other fund expenses. The examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from October 1, 2020 to March 31, 2021 (the “Period”).
Actual Expenses
This section provides information about actual account values and actual expenses. The “Ending Account Value” shown is derived from each Fund’s actual return. You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for the Fund under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
| Class A | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,327.80 | 1.11% | $6.43 | ||||
Global Equity Fund | $1,000.00 | $1,374.50 | 1.25% | $7.39 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,259.90 | 1.30% | $7.35 | ||||
International Small Cap Fund | $1,000.00 | $1,380.80 | 1.32% | $7.86 | ||||
Small Cap Value Fund | $1,000.00 | $1,477.90 | 1.15% | $7.10 | ||||
Core Plus Fixed Income Fund | $1,000.00 | $ 988.00 | 0.50% | $2.47 | ||||
| Class C | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,322.90 | 1.86% | $10.76 | ||||
Global Equity Fund | $1,000.00 | $1,368.80 | 2.00% | $11.80 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,255.30 | 2.05% | $11.55 | ||||
International Small Cap Fund | $1,000.00 | $1,375.10 | 2.07% | $12.29 | ||||
40
Brandes Investment Trust
| Class I | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,329.80 | 0.85% | $4.93 | ||||
Global Equity Fund | $1,000.00 | $1,376.20 | 1.00% | $5.92 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,263.10 | 1.12% | $6.31 | ||||
International Small Cap Fund | $1,000.00 | $1,382.00 | 1.14% | $6.74 | ||||
Small Cap Value Fund | $1,000.00 | $1,479.90 | 0.90% | $5.56 | ||||
Core Plus Fixed Income Fund | $1,000.00 | $ 989.20 | 0.30% | $1.49 | ||||
| Class R6 | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,330.60 | 0.75% | $4.35 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,263.00 | 0.97% | $5.47 | ||||
International Small Cap Fund | $1,000.00 | $1,383.70 | 1.00% | $5.93 | ||||
Small Cap Value Fund | $1,000.00 | $1,485.40 | 0.72% | $4.46 | ||||
Core Plus Fixed Income Fund | $1,000.00 | $ 996.70 | 0.30% | $1.49 | ||||
| * | The Fund’s expenses are equal to the Fund’s expense ratio for the period, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one half-year period). |
Hypothetical Example for Comparison Purposes
This section provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which are not the Funds’ actual returns. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other mutual funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as brokerage commissions on purchase and sales of Fund shares. Therefore, the last column of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
41
Brandes Investment Trust
| Class A | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,019.40 | 1.11% | $5.58 | ||||
Global Equity Fund | $1,000.00 | $1,018.71 | 1.25% | $6.28 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,018.43 | 1.30% | $6.56 | ||||
International Small Cap Fund | $1,000.00 | $1,018.33 | 1.32% | $6.66 | ||||
Small Cap Value Fund | $1,000.00 | $1,019.20 | 1.15% | $5.78 | ||||
Core Plus Fixed Income Fund | $1,000.00 | $1,022.44 | 0.50% | $2.52 | ||||
| Class C | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,015.67 | 1.86% | $ 9.34 | ||||
Global Equity Fund | $1,000.00 | $1,014.97 | 2.00% | $10.03 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,014.69 | 2.05% | $10.32 | ||||
International Small Cap Fund | $1,000.00 | $1,014.59 | 2.07% | $10.42 | ||||
| Class I | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,020.70 | 0.85% | $4.28 | ||||
Global Equity Fund | $1,000.00 | $1,019.95 | 1.00% | $5.03 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,019.36 | 1.12% | $5.63 | ||||
International Small Cap Fund | $1,000.00 | $1,019.27 | 1.14% | $5.71 | ||||
Small Cap Value Fund | $1,000.00 | $1,020.45 | 0.90% | $4.53 | ||||
Core Plus Fixed Income Fund | $1,000.00 | $1,023.44 | 0.30% | $1.51 | ||||
| Class R6 | ||||||||
| Fund | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period* | ||||
International Equity Fund | $1,000.00 | $1,021.20 | 0.75% | $3.77 | ||||
Emerging Markets Value Fund | $1,000.00 | $1,020.10 | 0.97% | $4.88 | ||||
International Small Cap Fund | $1,000.00 | $1,019.95 | 1.00% | $5.03 | ||||
Small Cap Value Fund | $1,000.00 | $1,021.34 | 0.72% | $3.63 | ||||
Core Plus Fixed Income Fund | $1,000.00 | $1,023.44 | 0.30% | $1.51 | ||||
| * | The Fund’s expenses are equal to the Fund’s expense ratio for the period, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one half-year period). |
42
Brandes International Equity Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited)
| Shares | Value | |
| COMMON STOCKS – 94.42% | ||
| Belgium – 1.10% | ||
| 108,008 | Anheuser-Busch InBev SA/NV | $ 6,789,690 |
| Brazil – 4.28% | ||
| 2,961,200 | Ambev SA | 8,043,980 |
| 925,447 | Embraer SA Sponsored – ADR(a) | 9,263,724 |
| 1,150,100 | Telefonica Brasil SA | 9,037,500 |
| 26,345,204 | ||
| Canada – 0.69% | ||
| 257,078 | Cameco Corp. | 4,270,065 |
| France – 19.93% | ||
| 170,605 | BNP Paribas SA(a) | 10,394,846 |
| 811,721 | Carrefour SA | 14,696,703 |
| 195,425 | Cie de Saint-Gobain(a) | 11,540,149 |
| 168,325 | Danone SA | 11,521,521 |
| 809,027 | Engie SA(a) | 11,492,492 |
| 852,807 | Orange SA | 10,494,609 |
| 272,138 | Publicis Groupe SA | 16,595,606 |
| 109,350 | Renault SA(a) | 4,728,496 |
| 155,731 | Sanofi | 15,399,328 |
| 109,119 | Societe BIC SA | 6,387,271 |
| 203,578 | Total SE | 9,490,760 |
| 122,741,781 | ||
| Germany – 6.86% | ||
| 88,582 | BASF SE | 7,361,428 |
| 247,227 | Fresenius & Co. KGaA | 11,016,532 |
| 163,623 | HeidelbergCement AG | 14,866,452 |
| 91,017 | Henkel AG & Co. KGaA | 9,017,267 |
| 42,261,679 | ||
| Hong Kong – 0.64% | ||
| 11,842,000 | First Pacific Co. Ltd. | 3,915,222 |
| Ireland – 1.26% | ||
| 165,736 | CRH Plc | 7,769,770 |
| Italy – 5.99% | ||
| 1,040,160 | Eni SpA | 12,817,072 |
| 4,158,760 | Intesa Sanpaolo SpA(a) | 11,268,466 |
| 20,990,411 | Telecom Italia Rsp | 12,069,966 |
| 1,365,052 | Telecom Italia SpA | 738,470 |
| 36,893,974 | ||
| Shares | Value | |
| Japan – 13.34% | ||
| 243,700 | Dai Nippon Printing Co. Ltd. | $ 5,111,748 |
| 311,800 | Honda Motor Co. Ltd. | 9,399,376 |
| 2,132,500 | Mitsubishi UFJ Financial Group, Inc. | 11,403,098 |
| 345,899 | MS&AD Insurance Group Holdings, Inc. | 10,174,961 |
| 983,300 | Nissan Motor Co. Ltd.(a) | 5,493,355 |
| 283,500 | Sumitomo Mitsui Trust Holdings, Inc. | 9,891,177 |
| 118,300 | Taisho Pharmaceutical Holdings Co. Ltd. | 7,644,657 |
| 632,083 | Takeda Pharmaceutical Co. Ltd. | 23,040,798 |
| 82,159,170 | ||
| Mexico – 5.56% | ||
| 1,413,992 | Cemex SAB de CV Sponsored – ADR(a) | 9,855,524 |
| 12,910,084 | Fibra Uno Administracion SA de CV | 15,089,504 |
| 123,412 | Fomento Economico Mexicano SAB de CV – ADR | 9,296,626 |
| 34,241,654 | ||
| Netherlands – 1.09% | ||
| 1,411,784 | Aegon NV | 6,707,783 |
| South Korea – 4.35% | ||
| 157,131 | Hana Financial Group, Inc. | 5,943,163 |
| 26,804 | Hyundai Mobis Co. Ltd. | 6,952,740 |
| 99,249 | KT&G Corp. | 7,149,565 |
| 23,883 | POSCO | 6,767,397 |
| 26,812,865 | ||
| Spain – 1.25% | ||
| 619,579 | Repsol SA | 7,690,195 |
| Switzerland – 9.49% | ||
| 1,091,773 | Credit Suisse Group AG Registered | 11,550,264 |
| 143,252 | Novartis AG Registered | 12,245,284 |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
43
Brandes International Equity Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| 16,342 | Swatch Group AG Bearer | $ 4,705,491 |
| 119,343 | Swatch Group AG Registered | 6,654,604 |
| 94,693 | Swiss Re AG | 9,312,404 |
| 903,408 | UBS Group AG Registered | 13,977,067 |
| 58,445,114 | ||
| Taiwan – 1.02% | ||
| 481,000 | Asustek Computer, Inc. | 6,310,601 |
| United Kingdom – 17.57% | ||
| 3,660,794 | Barclays Plc | 9,375,005 |
| 3,059,491 | BP Plc | 12,427,520 |
| 966,701 | GlaxoSmithKline Plc | 17,113,337 |
| 400,385 | Imperial Brands Plc | 8,208,263 |
| 3,637,517 | J Sainsbury Plc | 12,163,819 |
| 2,225,208 | Kingfisher Plc(a) | 9,753,180 |
| 3,811,873 | Marks & Spencer Group Plc(a) | 7,923,277 |
| 2,396,264 | Tesco Plc | 7,565,555 |
| Shares | Value | |
| 3,080,264 | Wm Morrison Supermarkets Plc | $ 7,747,084 |
| 1,250,278 | WPP Plc | 15,932,892 |
| 108,209,932 | ||
| TOTAL COMMON STOCKS (Cost $601,315,055) | $581,564,699 | |
| PREFERRED STOCKS – 5.14% | ||
| Brazil – 1.55% | ||
| 2,233,200 | Petroleo Brasileiro SA, 3.28%(b) | $ 9,561,817 |
| Russia – 1.43% | ||
| 15,780,039 | Surgutneftegas PJSC, 2.31%(b) | 8,765,529 |
| Spain – 2.16% | ||
| 777,959 | Grifols SA – Class B, 2.21%(b) | 13,321,823 |
| TOTAL PREFERRED STOCKS (Cost $28,330,638) | $ 31,649,169 | |
| Shares | Value | |
| SHORT-TERM INVESTMENTS – 1.06% | ||
| Money Market Funds — 1.06% | ||
Northern Institutional Funds - Treasury Portfolio (Premier), 0.01%(c) | 6,524,877 | $ 6,524,877 |
TOTAL SHORT-TERM INVESTMENTS (Cost $6,524,877) | $ 6,524,877 | |
Total Investments (Cost $636,170,570) – 100.62% | $619,738,745 | |
Liabilities in Excess of Other Assets – (0.62)% | (3,806,210) | |
TOTAL NET ASSETS – 100.00% | $615,932,535 | |
| Percentages are stated as a percent of net assets. | ||
| ADR American Depositary Receipt | ||
| (a) | Non-income producing security. |
| (b) | Current yield is disclosed. Dividends are calculated based on a percentage of the issuer’s net income. |
| (c) | The rate shown is the annualized seven day yield as of March 31, 2021. |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
44
Brandes International Equity Fund
SCHEDULE OF INVESTMENTS BY INDUSTRY — March 31, 2021
| COMMON STOCKS | |
Aerospace & Defense | 1.50% |
Auto Components | 1.13% |
Automobiles | 3.19% |
Banks | 9.46% |
Beverages | 3.92% |
Building Products | 1.87% |
Capital Markets | 4.15% |
Chemicals | 1.20% |
Commercial Services & Supplies | 1.87% |
Construction Materials | 5.27% |
Diversified Financial Services | 0.64% |
Diversified Telecommunication Services | 5.25% |
Equity Real Estate Investment Trusts | 2.45% |
Food & Staples Retailing | 6.85% |
Food Products | 1.87% |
Health Care Providers & Services | 1.79% |
Household Products | 1.46% |
Insurance | 4.25% |
Media | 5.28% |
Metals & Mining | 1.10% |
Multiline Retail | 1.29% |
Multi-Utilities | 1.87% |
Oil, Gas & Consumable Fuels | 7.58% |
Pharmaceuticals | 12.25% |
Specialty Retail | 1.58% |
Technology Hardware, Storage & Peripherals | 1.02% |
Textiles, Apparel & Luxury Goods | 1.84% |
Tobacco | 2.49% |
TOTAL COMMON STOCKS | 94.42% |
| PREFERRED STOCKS | |
Biotechnology | 2.16% |
Oil, Gas & Consumable Fuels | 2.98% |
TOTAL PREFERRED STOCKS | 5.14% |
SHORT-TERM INVESTMENTS | 1.06% |
TOTAL INVESTMENTS | 100.62% |
Liabilities in Excess of Other Assets | (0.62)% |
TOTAL NET ASSETS | 100.00% |
The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC or were otherwise determined by the Advisor to be appropriate. This information is unaudited.
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
45
Brandes Global Equity Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited)
| Shares | Value | |
| COMMON STOCKS – 97.77% | ||
| Austria – 1.95% | ||
| 23,579 | Erste Group Bank AG(a) | $ 798,817 |
| Brazil – 1.26% | ||
| 154,720 | Embraer SA(a) | 385,106 |
| 12,908 | Embraer SA Sponsored – ADR(a) | 129,209 |
| 514,315 | ||
| China – 1.96% | ||
| 28,200 | Alibaba Group Holding Ltd.(a) | 801,236 |
| France – 11.28% | ||
| 21,495 | Carrefour SA | 389,180 |
| 25,147 | Engie SA(a) | 357,222 |
| 31,200 | Engie SA (Prime Fidelite 2019)(a) | 443,206 |
| 15,151 | Publicis Groupe SA | 923,943 |
| 11,990 | Sanofi | 1,185,621 |
| 3,056 | Schneider Electric SE | 465,536 |
| 18,112 | Total SE | 844,377 |
| 4,609,085 | ||
| Germany – 2.20% | ||
| 9,903 | HeidelbergCement AG | 899,766 |
| Ireland – 1.33% | ||
| 11,612 | CRH Plc | 544,375 |
| Italy – 1.18% | ||
| 39,071 | Eni SpA | 481,441 |
| Japan – 1.26% | ||
| 17,100 | Honda Motor Co. Ltd. | 515,489 |
| Malaysia – 1.56% | ||
| 523,900 | Genting Berhad | 636,018 |
| Mexico – 2.66% | ||
| 603,134 | Fibra Uno Administracion SA de CV | 704,952 |
| 5,080 | Fomento Economico Mexicano SAB de CV – ADR | 382,677 |
| 1,087,629 | ||
| South Korea – 5.82% | ||
| 2,301 | Hyundai Mobis Co. Ltd. | 596,861 |
| 3,619 | Hyundai Motor Co. | 701,389 |
| Shares | Value | |
| 4,813 | KT&G Corp. | $ 346,712 |
| 10,141 | Samsung Electronics Co. Ltd. | 733,647 |
| 2,378,609 | ||
| Spain – 1.31% | ||
| 42,988 | Repsol SA | 533,566 |
| Switzerland – 3.52% | ||
| 49,369 | Credit Suisse Group AG Registered | 522,292 |
| 59,244 | UBS Group AG Registered | 916,593 |
| 1,438,885 | ||
| United Kingdom – 15.30% | ||
| 147,402 | Barclays Plc | 377,485 |
| 204,270 | BP Plc | 829,736 |
| 54,464 | GlaxoSmithKline Plc | 964,167 |
| 38,224 | Imperial Brands Plc | 783,627 |
| 177,095 | J Sainsbury Plc | 592,204 |
| 154,830 | Kingfisher Plc(a) | 678,626 |
| 10,818 | Royal Dutch Shell Plc – ADR – Class B | 398,427 |
| 145,629 | Tesco Plc | 459,784 |
| 145,089 | Wm Morrison Supermarkets Plc | 364,909 |
| 62,874 | WPP Plc | 801,234 |
| 6,250,199 | ||
| United States – 45.18% | ||
| 1,746 | Amdocs Ltd. | 122,482 |
| 13,200 | American International Group, Inc. | 609,972 |
| 30,151 | Bank of America Corp. | 1,166,542 |
| 13,678 | Bank of New York Mellon Corp. | 646,833 |
| 12,049 | Cardinal Health, Inc. | 731,977 |
| 24,036 | Change Healthcare, Inc.(a) | 531,196 |
| 2,910 | Cigna Corp. | 703,463 |
| 17,550 | Citigroup, Inc. | 1,276,762 |
| 12,480 | Comcast Corp. – Class A | 675,293 |
| 11,340 | Corteva, Inc. | 528,671 |
| 8,496 | CVS Health Corp. | 639,154 |
| 5,508 | Emerson Electric Co. | 496,932 |
| 2,127 | FedEx Corp. | 604,153 |
| 2,939 | General Dynamics Corp. | 533,605 |
| 19,290 | Halliburton Co. | 413,963 |
| 3,338 | HCA Healthcare, Inc. | 628,679 |
| 4,558 | Ingredion, Inc. | 409,855 |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
46
Brandes Global Equity Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| 3,040 | JPMorgan Chase & Co. | $ 462,779 |
| 2,198 | Laboratory Corp. of America Holdings(a) | 560,556 |
| 4,165 | McKesson Corp. | 812,342 |
| 10,954 | Merck & Co., Inc. | 844,444 |
| 3,846 | Mohawk Industries, Inc.(a) | 739,624 |
| 20,899 | Old Republic International Corp. | 456,434 |
| 8,335 | OneMain Holdings, Inc. | 447,756 |
| 19,831 | Pfizer, Inc. | 718,477 |
| 1,185 | PNC Financial Services Group, Inc. | 207,861 |
| 7,368 | State Street Corp. | 618,986 |
| 9,436 | Textron, Inc. | 529,171 |
| Shares | Value | |
| 7,627 | Truist Financial Corp. | $ 444,807 |
| 22,993 | Wells Fargo & Co. | 898,336 |
| 18,461,105 | ||
| TOTAL COMMON STOCKS (Cost $31,532,279) | $39,950,535 | |
| PREFERRED STOCKS – 0.49% | ||
| South Korea – 0.49% | ||
| 3,072 | Samsung Electronics Co. Ltd., 1.864%(b) | $ 198,968 |
| TOTAL PREFERRED STOCKS (Cost $90,995) | $ 198,968 | |
| Shares | Value | |
| SHORT-TERM INVESTMENTS – 2.54% | ||
| Money Market Funds — 2.54% | ||
Northern Institutional Funds - Treasury Portfolio (Premier), 0.01%(c) | 1,039,632 | $ 1,039,632 |
TOTAL SHORT-TERM INVESTMENTS (Cost $1,039,632) | $ 1,039,632 | |
Total Investments (Cost $32,662,906) – 100.80% | $41,189,135 | |
Liabilities in Excess of Other Assets – (0.80)% | (328,497) | |
TOTAL NET ASSETS – 100.00% | $40,860,638 | |
| Percentages are stated as a percent of net assets. | ||
| ADR American Depositary Receipt | ||
| (a) | Non-income producing security. |
| (b) | Current yield is disclosed. Dividends are calculated based on a percentage of the issuer’s net income. |
| (c) | The rate shown is the annualized seven day yield as of March 31, 2021. |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
47
Brandes Global Equity Fund
SCHEDULE OF INVESTMENTS BY INDUSTRY — March 31, 2021
| COMMON STOCKS | |
Aerospace & Defense | 3.87% |
Air Freight & Logistics | 1.48% |
Auto Components | 1.46% |
Automobiles | 2.98% |
Banks | 13.78% |
Beverages | 0.94% |
Capital Markets | 6.61% |
Chemicals | 1.29% |
Construction Materials | 3.53% |
Consumer Finance | 1.10% |
Electrical Equipment | 2.36% |
Energy Equipment & Services | 1.01% |
Equity Real Estate Investment Trusts | 1.72% |
Food & Staples Retailing | 4.42% |
Food Products | 1.00% |
Health Care Providers & Services | 9.97% |
Health Care Technology | 1.30% |
Hotels, Restaurants & Leisure | 1.56% |
Household Durables | 1.81% |
Insurance | 2.61% |
Internet & Direct Marketing Retail | 1.96% |
IT Services | 0.30% |
Media | 5.87% |
Multi-Utilities | 1.96% |
Oil, Gas & Consumable Fuels | 7.57% |
Pharmaceuticals | 9.09% |
Specialty Retail | 1.66% |
Technology Hardware, Storage & Peripherals | 1.79% |
Tobacco | 2.77% |
TOTAL COMMON STOCKS | 97.77% |
| PREFERRED STOCKS | |
Technology Hardware, Storage & Peripherals | 0.49% |
TOTAL PREFERRED STOCKS | 0.49% |
SHORT-TERM INVESTMENTS | 2.54% |
TOTAL INVESTMENTS | 100.80% |
Liabilities in Excess of Other Assets | (0.80)% |
TOTAL NET ASSETS | 100.00% |
The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC or were otherwise determined by the Advisor to be appropriate. This information is unaudited.
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
48
Brandes Emerging Markets Value Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited)
| Shares | Value | |
| COMMON STOCKS – 95.50% | ||
| Argentina – 1.44% | ||
| 1,176,931 | Adecoagro SA(a) | $ 9,250,677 |
| 2,415,979 | YPF SA Sponsored – ADR(a) | 9,929,674 |
| 19,180,351 | ||
| Brazil – 6.45% | ||
| 6,258,400 | Cogna Educacao(a) | 4,425,294 |
| 3,339,780 | Embraer SA Sponsored – ADR(a) | 33,431,198 |
| 1,548,600 | Sendas Distribuidora SA(a) | 20,315,462 |
| 1,125,300 | Telefonica Brasil SA | 8,842,621 |
| 630,648 | Telefonica Brasil SA – ADR | 4,963,200 |
| 6,051,000 | TIM SA(a) | 13,620,703 |
| 85,598,478 | ||
| Chile – 2.15% | ||
| 2,336,679 | Empresa Nacional de Telecomunicaciones SA | 14,669,753 |
| 102,629,673 | Enel Chile SA | 7,988,884 |
| 1,509,388 | Enel Chile SA Sponsored – ADR | 5,916,801 |
| 28,575,438 | ||
| China – 21.55% | ||
| 2,320,000 | Alibaba Group Holding Ltd.(a) | 65,917,292 |
| 10,745,000 | China Education Group Holdings Ltd. | 19,170,956 |
| 25,636,136 | China Railway Signal & Communication Corp. Ltd. – Class H(b) | 10,527,172 |
| 5,259,728 | China South Publishing & Media Group Co. Ltd. – Class A | 8,419,324 |
| 2,074,000 | Galaxy Entertainment Group Ltd.(a) | 18,749,659 |
| Shares | Value | |
| 21,333,500 | Genertec Universal Medical Group Co. Ltd.(b) | $ 17,530,769 |
| 2,128,614 | Gree Electric Appliances, Inc. of Zhuhai – Class A | 20,392,603 |
| 33,944,000 | PetroChina Co. Ltd. – Class H | 12,306,744 |
| 2,035,500 | Ping An Insurance Group Co. of China Ltd. – Class H | 24,347,341 |
| 11,240,200 | Shanghai Pharmaceuticals Holding Co. Ltd. – Class H | 22,093,355 |
| 10,868,000 | TravelSky Technology Ltd. – Class H | 25,496,246 |
| 10,355,400 | Wynn Macau Ltd.(a) | 20,146,717 |
| 724,569 | ZTO Express Cayman, Inc. – ADR | 21,121,186 |
| 286,219,364 | ||
| Czech Republic – 0.46% | ||
| 521,469 | O2 Czech Republic AS | 6,068,402 |
| Greece – 0.54% | ||
| 444,037 | Hellenic Telecommunications Organization SA | 7,124,716 |
| Hong Kong – 4.24% | ||
| 1,754,400 | AIA Group Ltd. | 21,468,190 |
| 28,461,920 | First Pacific Co. Ltd. | 9,410,127 |
| 10,597,500 | Lifestyle International Holdings Ltd.(a) | 9,258,256 |
| 5,860,000 | Luk Fook Holdings International Ltd. | 16,163,110 |
| 56,299,683 | ||
| India – 6.49% | ||
| 1,087,855 | HDFC Bank Ltd.(a) | 22,268,112 |
| 4,433,431 | Indus Towers Ltd. | 14,905,659 |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
49
Brandes Emerging Markets Value Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| 7,535,312 | Power Grid Corp. of India Ltd. | $ 22,269,465 |
| 9,582,906 | Zee Entertainment Enterprises Ltd. | 26,752,801 |
| 86,196,037 | ||
| Indonesia – 4.54% | ||
| 61,066,800 | Bank Rakyat Indonesia Persero Tbk PT(a) | 18,526,709 |
| 6,759,412 | Gudang Garam Tbk PT(a) | 16,855,630 |
| 23,202,900 | Indofood Sukses Makmur Tbk PT | 10,568,231 |
| 99,025,715 | XL Axiata Tbk PT | 14,286,836 |
| 60,237,406 | ||
| Malaysia – 1.92% | ||
| 21,002,200 | Genting Berhad | 25,496,790 |
| Mexico – 9.71% | ||
| 31,044,840 | America Movil SAB de CV | 21,203,355 |
| 4,321,770 | Cemex SAB de CV Sponsored – ADR(a) | 30,122,737 |
| 30,944,403 | Fibra Uno Administracion SA de CV | 36,168,291 |
| 191,371 | Fomento Economico Mexicano SAB de CV – ADR | 14,415,978 |
| 4,099,700 | Macquarie Mexico Real Estate Management SA de CV(b) | 5,112,716 |
| 14,553,184 | PLA Administradora Industrial S de RL de CV | 21,687,907 |
| 512,122 | Urbi Desarrollos Urbanos SAB de CV(a) | 205,455 |
| 128,916,439 | ||
| Shares | Value | |
| Panama – 2.07% | ||
| 644,836 | Banco Latinoamericano de Comercio Exterior SA – Class E | $ 9,756,369 |
| 219,291 | Copa Holdings SA – Class A(a) | 17,716,520 |
| 27,472,889 | ||
| Philippines – 1.44% | ||
| 11,369,764 | Bank of the Philippine Islands | 19,125,516 |
| Russia – 6.09% | ||
| 175,358 | Lukoil PJSC Sponsored – ADR | 14,209,767 |
| 4,751,561 | Mobile TeleSystems PJSC | 19,864,680 |
| 8,476,466 | Sberbank of Russia PJSC | 32,540,392 |
| 1,571,174 | Sistema PJSFC Sponsored – GDR | 14,203,103 |
| 80,817,942 | ||
| South Africa – 1.13% | ||
| 1,760,684 | Absa Group Ltd. | 15,041,007 |
| South Korea – 11.47% | ||
| 468,867 | KT&G Corp. | 33,775,605 |
| 158,079 | POSCO | 44,792,670 |
| 115,629 | S-1 Corp. | 8,347,152 |
| 610,691 | Samsung Electronics Co. Ltd. | 44,180,210 |
| 636,890 | Shinhan Financial Group Co. Ltd. | 21,152,412 |
| 152,248,049 | ||
| Spain – 0.79% | ||
| 11,548,879 | Prosegur Cash SA(b) | 10,544,879 |
| Taiwan – 8.05% | ||
| 256,000 | Largan Precision Co. Ltd. | 28,953,753 |
| 2,263,000 | Taiwan Semiconductor Manufacturng Co. Ltd. | 47,656,996 |
| 1,022,000 | Wiwynn Corp. | 30,297,112 |
| 106,907,861 | ||
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
50
Brandes Emerging Markets Value Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| Thailand – 3.93% | ||
| 1,578,500 | Bangkok Bank PCL – Class F | $ 6,375,479 |
| 1,578,500 | Bangkok Bank PCL – NVDR | 6,381,591 |
| 88,047,881 | Jasmine Broadband Internet Infrastructure Fund – Class F | 27,060,343 |
| 3,474,400 | Siam Commercial Bank PCL – Class F | 12,412,000 |
| 52,229,413 | ||
| United Kingdom – 1.04% | ||
| 10,376,419 | Vivo Energy Plc(b) | 13,875,785 |
| TOTAL COMMON STOCKS (Cost $1,345,553,466) | $1,268,176,445 | |
| PREFERRED STOCKS – 3.02% | ||
| Brazil – 1.59% | ||
| 4,920,700 | Petroleo Brasileiro SA, 3.276%(c) | $ 21,068,794 |
| Shares | Value | |
| Russia – 1.43% | ||
| 205,610 | Surgutneftegas PJSC Sponsored – ADR, 2.398%(c) | $ 1,143,500 |
| 32,081,832 | Surgutneftegas PJSC, 2.310%(c) | 17,820,883 |
| 18,964,383 | ||
| TOTAL PREFERRED STOCKS (Cost $41,816,635) | $ 40,033,177 | |
| PARTICIPATORY NOTES – 0.39% | ||
| China – 0.39% | ||
| 3,247,557 | China South Publishing & Media Group Co. Ltd.(d) | $ 5,189,166 |
| TOTAL PARTICIPATORY NOTES (Cost $5,613,680) | $ 5,189,166 | |
| Shares | Value | |
| SHORT-TERM INVESTMENTS – 0.91% | ||
| Money Market Funds — 0.91% | ||
Northern Institutional Funds - Treasury Portfolio (Premier), 0.01%(e) | 12,063,445 | $ 12,063,445 |
TOTAL SHORT-TERM INVESTMENTS (Cost $12,063,445) | $ 12,063,445 | |
Total Investments (Cost $1,405,047,226) – 99.82% | $1,325,462,233 | |
Other Assets in Excess of Liabilities – 0.18% | 2,441,811 | |
TOTAL NET ASSETS – 100.00% | $1,327,904,044 | |
| Percentages are stated as a percent of net assets. | ||
| ADR American Depositary Receipt | ||
| GDR Global Depositary Receipt | ||
| NVDR Non-Voting Depositary Receipt | ||
| (a) | Non-income producing security. |
| (b) | Acquired in a transaction exempt from registration under Rule 144A or Section 4(a)(2) of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $57,591,321 which represented 4.34% of the net assets of the Fund. |
| (c) | Current yield is disclosed. Dividends are calculated based on a percentage of the issuer’s net income. |
| (d) | Represents the underlying security of a participatory note with HSBC Bank Plc. China South Publishing & Media Group Co. Ltd. has a maturity date of November 23, 2021. |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
51
Brandes Emerging Markets Value Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| (e) | The rate shown is the annualized seven day yield as of March 31, 2021. |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
52
Brandes Emerging Markets Value Fund
SCHEDULE OF INVESTMENTS BY INDUSTRY — March 31, 2021
| COMMON STOCKS | |
Aerospace & Defense | 2.52% |
Air Freight & Logistics | 1.59% |
Airlines | 1.33% |
Banks | 11.57% |
Beverages | 1.09% |
Commercial Services & Supplies | 1.42% |
Construction Materials | 2.27% |
Diversified Consumer Services | 1.77% |
Diversified Financial Services | 1.45% |
Diversified Telecommunication Services | 3.16% |
Electric Utilities | 2.73% |
Electronic Equipment, Instruments & Components | 2.97% |
Equity Real Estate Investment Trusts | 4.73% |
Food & Staples Retailing | 1.53% |
Food Products | 1.49% |
Health Care Providers & Services | 2.98% |
Hotels, Restaurants & Leisure | 4.85% |
Household Durables | 1.56% |
Insurance | 3.44% |
Internet & Direct Marketing Retail | 4.96% |
IT Services | 1.92% |
Media | 2.65% |
Metals & Mining | 3.37% |
Multiline Retail | 0.70% |
Oil, Gas & Consumable Fuels | 2.75% |
Semiconductors & Semiconductor Equipment | 3.59% |
Specialty Retail | 2.26% |
Technology Hardware, Storage & Peripherals | 5.61% |
Tobacco | 3.82% |
Wireless Telecommunication Services | 9.42% |
TOTAL COMMON STOCKS | 95.50% |
| PREFERRED STOCKS | |
Oil, Gas & Consumable Fuels | 3.02% |
TOTAL PREFERRED STOCKS | 3.02% |
| PARTICIPATORY NOTES | |
Media | 0.39% |
TOTAL PARTICIPATORY NOTES | 0.39% |
SHORT-TERM INVESTMENTS | 0.91% |
TOTAL INVESTMENTS | 99.82% |
Other Assets in Excess of Liabilities | 0.18% |
TOTAL NET ASSETS | 100.00% |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
53
Brandes Emerging Markets Value Fund
SCHEDULE OF INVESTMENTS BY INDUSTRY — March 31, 2021 (continued)
The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC or were otherwise determined by the Advisor to be appropriate. This information is unaudited.
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
54
Brandes International Small Cap Equity Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited)
| Shares | Value | |
| COMMON STOCKS – 96.75% | ||
| Austria – 0.93% | ||
| 243,798 | Addiko Bank AG(a) | $ 3,630,954 |
| Brazil – 4.32% | ||
| 6,739,240 | Embraer SA(a) | 16,774,316 |
| Canada – 6.83% | ||
| 438,723 | Cameco Corp. | 7,287,189 |
| 265,929 | Corby Spirit and Wine Ltd. | 3,717,970 |
| 533,960 | Dorel Industries, Inc. – Class B(a) | 5,391,862 |
| 5,781 | E-L Financial Corp. Ltd. | 4,255,132 |
| 395,438 | Sierra Wireless, Inc.(a) | 5,840,619 |
| 26,492,772 | ||
| China – 1.85% | ||
| 12,512,900 | Boyaa Interactive International Ltd.(a) | 917,451 |
| 241,205 | China Yuchai International Ltd. | 3,733,853 |
| 9,469,000 | Weiqiao Textile Co. – Class H | 2,521,299 |
| 7,172,603 | ||
| France – 6.31% | ||
| 636,642 | Elior Group SA(b) | 4,717,821 |
| 72,977 | Savencia SA(a) | 6,230,233 |
| 148,323 | Societe BIC SA | 8,682,074 |
| 99,979 | Vicat SA | 4,851,883 |
| 24,482,011 | ||
| Germany – 1.01% | ||
| 51,795 | Draegerwerk AG & Co. KGaA | 3,928,052 |
| Greece – 0.62% | ||
| 236,992 | Sarantis SA | 2,406,792 |
| Hong Kong – 5.06% | ||
| 4,180,050 | APT Satellite Holdings Ltd. | 1,272,131 |
| 2,059,500 | Dickson Concepts International Ltd. | 1,099,939 |
| 70,600,000 | Emperor Watch & Jewellery Ltd.(a) | 1,282,501 |
| Shares | Value | |
| 20,663,000 | First Pacific Co. Ltd. | $ 6,831,635 |
| 8,440,000 | PAX Global Technology Ltd. | 9,134,925 |
| 19,621,131 | ||
| Hungary – 2.18% | ||
| 6,434,230 | Magyar Telekom Telecommunications Plc | 8,475,851 |
| Ireland – 6.56% | ||
| 3,839,514 | AIB Group Plc(a) | 10,072,857 |
| 517,024 | Avadel Pharmaceuticals Plc – ADR(a) | 4,673,897 |
| 2,772,645 | C&C Group Plc(a) | 10,716,501 |
| 25,463,255 | ||
| Israel – 0.93% | ||
| 48,896 | Taro Pharmaceutical Industries Ltd.(a) | 3,606,080 |
| Italy – 4.11% | ||
| 160,158 | Buzzi Unicem SpA | 4,160,105 |
| 722,111 | Credito Emiliano SpA(a) | 4,214,873 |
| 357,331 | Danieli & C Officine Meccaniche SpA | 5,472,689 |
| 1,985,069 | Safilo Group SpA(a) | 2,119,544 |
| 15,967,211 | ||
| Japan – 16.03% | ||
| 1,211,500 | Concordia Financial Group Ltd. | 4,913,930 |
| 384,800 | Fuji Media Holdings, Inc. | 4,717,388 |
| 160,500 | Futaba Corp. | 1,412,809 |
| 1,579,800 | Hachijuni Bank Ltd. | 5,752,700 |
| 1,252,200 | Hyakugo Bank Ltd. | 3,778,296 |
| 295,600 | Japan Petroleum Exploration Co. Ltd. | 5,495,932 |
| 271,800 | Kissei Pharmaceutical Co. Ltd. | 6,025,622 |
| 1,144,744 | Komori Corp. | 7,765,989 |
| 529,200 | Kyushu Financial Group, Inc. | 2,272,059 |
| 166,400 | Mitsubishi Shokuhin Co. Ltd. | 4,659,856 |
| 147,400 | Nichiban Co. Ltd. | 2,550,190 |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
55
Brandes International Small Cap Equity Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| 88,800 | Nippon Seiki Co. Ltd. | $ 1,032,538 |
| 85,700 | Oita Bank Ltd. | 1,669,762 |
| 106,600 | Sankyo Co. Ltd. | 2,827,016 |
| 247,800 | Tachi-S Co. Ltd. | 2,692,399 |
| 290,000 | TSI Holdings Co. Ltd.(a) | 842,526 |
| 170,600 | Yodogawa Steel Works Ltd. | 3,786,760 |
| 62,195,772 | ||
| Malaysia – 1.22% | ||
| 3,902,000 | Genting Berhad | 4,737,050 |
| Mexico – 6.75% | ||
| 475,905 | Cemex SAB de CV Sponsored – ADR(a) | 3,317,058 |
| 27,839,278 | Consorcio ARA SAB de CV(a) | 6,115,529 |
| 279,501,983 | Desarrolladora Homex SAB de CV(a),(c) | 423,913 |
| 10,894,848 | Fibra Uno Administracion SA de CV | 12,734,065 |
| 2,642,515 | Macquarie Mexico Real Estate Management SA de CV(b) | 3,295,467 |
| 806,929 | Urbi Desarrollos Urbanos SAB de CV(a),(c) | 323,727 |
| 26,209,759 | ||
| Panama – 1.49% | ||
| 382,470 | Banco Latinoamericano de Comercio Exterior SA – Class E | 5,786,771 |
| Philippines – 0.59% | ||
| 1,581,332 | First Philippines Holdings Corp. | 2,274,056 |
| Slovenia – 1.61% | ||
| 474,148 | Nova Ljubljanska Banka – GDR(a),(b) | 5,838,350 |
| 33,305 | Nova Ljubljanska Banka dd Registered – GDR(a) | 410,096 |
| 6,248,446 | ||
| Shares | Value | |
| South Korea – 5.38% | ||
| 95,834 | Binggrae Co. Ltd. | $ 5,076,584 |
| 43,488 | Lotte Chilsung Beverage Co. Ltd. | 5,255,993 |
| 35,424 | Lotte Confectionery Co. Ltd. | 4,170,050 |
| 10,751 | Namyang Dairy Products Co. Ltd. | 2,878,967 |
| 50,208 | Samchully Co. Ltd. | 3,483,962 |
| 20,865,556 | ||
| Spain – 5.47% | ||
| 1,402,369 | Atresmedia Corp de Medios de Comunicacion SA(a) | 5,785,321 |
| 716,097 | Bankinter SA | 4,983,337 |
| 1,234,863 | CaixaBank SA | 3,833,987 |
| 1,106,026 | Lar Espana Real Estate Socimi SA | 6,614,887 |
| 21,217,532 | ||
| United Kingdom – 17.50% | ||
| 1,455,270 | Balfour Beatty Plc(a) | 5,921,890 |
| 2,501,936 | De La Rue Plc(a) | 7,126,041 |
| 3,567,587 | J Sainsbury Plc | 11,929,974 |
| 1,275,544 | LSL Property Services Plc(a) | 5,363,319 |
| 2,305,844 | Marks & Spencer Group Plc(a) | 4,792,878 |
| 14,349,096 | Mitie Group Plc(a) | 12,442,668 |
| 2,963,874 | Premier Foods Plc(a) | 3,889,869 |
| 4,728,021 | Wm Morrison Supermarkets Plc | 11,891,310 |
| 1,214,542 | Yellow Cake Plc(a),(b) | 4,562,525 |
| 67,920,474 | ||
| TOTAL COMMON STOCKS (Cost $364,332,304) | $375,476,444 | |
| PREFERRED STOCKS – 1.58% | ||
| Germany – 1.58% | ||
| 76,013 | Draegerwerk AG & Co. KGaA, 0.28%(d) | $ 6,115,035 |
| TOTAL PREFERRED STOCKS (Cost $4,889,447) | $ 6,115,035 | |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
56
Brandes International Small Cap Equity Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| SHORT-TERM INVESTMENTS – 2.05% | ||
| Money Market Funds — 2.05% | ||
Northern Institutional Funds - Treasury Portfolio (Premier), 0.01%(e) | 7,968,459 | $ 7,968,459 |
TOTAL SHORT-TERM INVESTMENTS (Cost $7,968,459) | $ 7,968,459 | |
Total Investments (Cost $377,190,210) – 100.38% | $389,559,938 | |
Liabilities in Excess of Other Assets – (0.38)% | (1,468,765) | |
TOTAL NET ASSETS – 100.00% | $388,091,173 | |
| Percentages are stated as a percent of net assets. | ||
| ADR American Depositary Receipt | ||
| GDR Global Depositary Receipt | ||
| (a) | Non-income producing security. |
| (b) | Acquired in a transaction exempt from registration under Rule 144A or Section 4(a)(2) of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $18,414,163 which represented 4.75% of the net assets of the Fund. |
| (c) | Affiliated issuer. See Note 3 in the Notes to Financial Statements. |
| (d) | Current yield is disclosed. Dividends are calculated based on a percentage of the issuer’s net income. |
| (e) | The rate shown is the annualized seven day yield as of March 31, 2021. |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
57
Brandes International Small Cap Equity Fund
SCHEDULE OF INVESTMENTS BY INDUSTRY — March 31, 2021
| COMMON STOCKS | |
Aerospace & Defense | 4.32% |
Auto Components | 0.96% |
Banks | 13.22% |
Beverages | 5.07% |
Commercial Services & Supplies | 7.95% |
Communications Equipment | 1.50% |
Construction & Engineering | 1.53% |
Construction Materials | 3.17% |
Diversified Financial Services | 3.25% |
Diversified Telecommunication Services | 2.51% |
Electric Utilities | 0.59% |
Electrical Equipment | 0.36% |
Electronic Equipment, Instruments & Components | 2.36% |
Entertainment | 0.24% |
Equity Real Estate Investment Trusts | 5.84% |
Food & Staples Retailing | 7.33% |
Food Products | 5.73% |
Gas Utilities | 0.90% |
Health Care Equipment & Supplies | 1.01% |
Hotels, Restaurants & Leisure | 2.44% |
Household Durables | 3.16% |
Insurance | 1.10% |
Leisure Products | 0.73% |
Machinery | 4.37% |
Media | 2.71% |
Metals & Mining | 0.98% |
Multiline Retail | 1.23% |
Oil, Gas & Consumable Fuels | 3.30% |
Personal Products | 0.62% |
Pharmaceuticals | 3.68% |
Real Estate Management & Development | 1.38% |
Specialty Retail | 0.61% |
Textiles, Apparel & Luxury Goods | 1.42% |
Trading Companies & Distributors | 1.18% |
TOTAL COMMON STOCKS | 96.75% |
| PREFERRED STOCKS | |
Health Care Equipment & Supplies | 1.58% |
TOTAL PREFERRED STOCKS | 1.58% |
SHORT-TERM INVESTMENTS | 2.05% |
TOTAL INVESTMENTS | 100.38% |
Liabilities in Excess of Other Assets | (0.38)% |
TOTAL NET ASSETS | 100.00% |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
58
Brandes International Small Cap Equity Fund
SCHEDULE OF INVESTMENTS BY INDUSTRY — March 31, 2021 (continued)
The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC or were otherwise determined by the Advisor to be appropriate. This information is unaudited.
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
59
Brandes Small Cap Value Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited)
| Shares | Value | |
| COMMON STOCKS – 87.23% | ||
| Aerospace & Defense – 9.26% | ||
| 6,121 | Embraer SA Sponsored – ADR(a) | $ 61,271 |
| 555 | National Presto Industries, Inc. | 56,649 |
| 4,945 | Park Aerospace Corp. | 65,373 |
| 481 | Textron, Inc. | 26,974 |
| 210,267 | ||
| Automobiles – 0.49% | ||
| 277 | Harley-Davidson, Inc. | 11,108 |
| Banks – 2.64% | ||
| 551 | ACNB Corp. | 16,144 |
| 445 | Eagle Bancorp Montana, Inc. | 10,823 |
| 931 | National Bankshares, Inc. | 33,060 |
| 60,027 | ||
| Biotechnology – 6.23% | ||
| 1,625 | Eagle Pharmaceuticals, Inc.(a) | 67,827 |
| 11,508 | PDL BioPharma, Inc.(a),(b) | 28,425 |
| 270 | United Therapeutics Corp.(a) | 45,163 |
| 141,415 | ||
| Communications Equipment – 5.19% | ||
| 1,754 | NETGEAR, Inc.(a) | 72,089 |
| 3,101 | Sierra Wireless, Inc.(a) | 45,802 |
| 117,891 | ||
| Construction & Engineering – 2.06% | ||
| 7,693 | Orion Group Holdings, Inc.(a) | 46,697 |
| Electric Utilities – 1.14% | ||
| 385 | ALLETE, Inc. | 25,868 |
| Electronic Equipment, Instruments & Components – 2.52% | ||
| 1,817 | Arlo Technologies, Inc.(a) | 11,411 |
| 1,105 | Avnet, Inc. | 45,868 |
| 57,279 | ||
| Energy Equipment & Services – 4.67% | ||
| 1,373 | Dril-Quip, Inc.(a) | 45,625 |
| 755 | Halliburton Co. | 16,202 |
| 1,638 | Helmerich & Payne, Inc. | 44,161 |
| 105,988 | ||
| Shares | Value | |
| Equity Real Estate Investment Trusts – 2.90% | ||
| 2,369 | Equity Commonwealth | $ 65,858 |
| Food & Staples Retailing – 1.40% | ||
| 516 | Ingles Markets, Inc. – Class A | 31,811 |
| Food Products – 1.84% | ||
| 556 | Cal-Maine Foods, Inc.(a) | 21,362 |
| 131 | Sanderson Farms, Inc. | 20,407 |
| 41,769 | ||
| Health Care Equipment & Supplies – 3.95% | ||
| 1,295 | Invacare Corp. | 10,386 |
| 1,477 | LENSAR, Inc.(a) | 10,723 |
| 531 | Utah Medical Products, Inc. | 45,984 |
| 1,102 | Varex Imaging Corp.(a) | 22,580 |
| 89,673 | ||
| Health Care Providers & Services – 2.82% | ||
| 1,354 | MEDNAX, Inc.(a) | 34,486 |
| 1,130 | Triple–S Management Corp. – Class B(a) | 29,414 |
| 63,900 | ||
| Health Care Technology – 0.54% | ||
| 550 | Change Healthcare, Inc.(a) | 12,155 |
| Household Durables – 2.38% | ||
| 2,419 | Dorel Industries, Inc. – Class B(a) | 24,427 |
| 962 | Taylor Morrison Home Corp.(a) | 29,639 |
| 54,066 | ||
| Insurance – 8.62% | ||
| 562 | American National Group, Inc. | 60,623 |
| 3,671 | Crawford & Co. – Class A | 39,096 |
| 215 | National Western Life Group, Inc. – Class A | 53,535 |
| 1,938 | Old Republic International Corp. | 42,326 |
| 195,580 | ||
| Machinery – 5.45% | ||
| 3,996 | Graham Corp. | 56,903 |
| 1,029 | Hurco Companies, Inc. | 36,323 |
| 1,703 | L.B. Foster Co. – Class A(a) | 30,484 |
| 123,710 | ||
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
60
Brandes Small Cap Value Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| Media – 1.20% | ||
| 904 | Scholastic Corp. | $ 27,219 |
| Multi-Utilities – 1.01% | ||
| 482 | Avista Corp. | 23,016 |
| Oil, Gas & Consumable Fuels – 4.72% | ||
| 1,433 | Chesapeake Energy Corp.(a) | 62,178 |
| 1,274 | World Fuel Services Corp. | 44,845 |
| 107,023 | ||
| Personal Products – 4.28% | ||
| 2,452 | Edgewell Personal Care Co. | 97,099 |
| Pharmaceuticals – 6.06% | ||
| 3,020 | Avadel Pharmaceuticals Plc – ADR(a) | 27,301 |
| 2,095 | Phibro Animal Health Corp. – Class A | 51,118 |
| 1,344 | Prestige Consumer Healthcare, Inc.(a) | 59,243 |
| 137,662 | ||
| Professional Services – 2.95% | ||
| 993 | Kelly Services, Inc. – Class A(a) | 22,114 |
| 3,312 | Resources Connection, Inc. | 44,845 |
| 66,959 | ||
| Shares | Value | |
| Textiles, Apparel & Luxury Goods – 1.19% | ||
| 950 | Movado Group, Inc. | $ 27,028 |
| Thrifts & Mortgage Finance – 0.93% | ||
| 799 | Territorial Bancorp, Inc. | 21,142 |
| Trading Companies & Distributors – 0.79% | ||
| 3,414 | Houston Wire & Cable Co.(a) | 17,821 |
| TOTAL COMMON STOCKS (Cost $1,725,518) | $1,980,031 | |
| WARRANTS – 1.15% | ||
| Oil, Gas & Consumable Fuels – 1.15% | ||
| 615 | Chesapeake Energy Corp., Exp. 2/9/2026, Strike $27.63(a) | $ 12,681 |
| 683 | Chesapeake Energy Corp., Exp. 2/9/2026, Strike $32.13(a) | 13,483 |
| 26,164 | ||
| TOTAL WARRANTS (Cost $12,994) | $ 26,164 | |
| Principal Amount | Value | |
| CORPORATE BONDS – 1.18% | ||
| Food & Staples Retailing – 0.58% | ||
Ingles Markets, Inc. 5.750%, 6/15/2023 | $ 13,000 | $ 13,097 |
| Multi-Utilities – 0.60% | ||
Avista Corp. 5.125%, 4/1/2022 | 13,000 | 13,595 |
TOTAL CORPORATE BONDS (Cost $26,820) | $ 26,692 | |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
61
Brandes Small Cap Value Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| SHORT-TERM INVESTMENTS – 11.16% | ||
Northern Institutional Funds - Treasury Portfolio (Premier), 0.010%, (c) | 253,314 | $ 253,314 |
TOTAL SHORT-TERM INVESTMENTS (Cost $253,314) | $ 253,314 | |
Total Investments (Cost $2,018,646) – 100.72% | $ 2,286,201 | |
Liabilities in Excess of Other Assets – (0.72)% | (16,339) | |
TOTAL NET ASSETS – 100.00% | $ 2,269,862 | |
| Percentages are stated as a percent of net assets. | ||
| ADR American Depositary Receipt | ||
| (a) | Non-income producing security. |
| (b) | The price for this security was derived from an estimate of fair market value using methods approved by the Fund’s Board of Trustees. This security represents $28,425 or 1.25% of the Fund’s net assets and is classified as a Level 3 security. See Note 2 in the Notes to Financial Statements. |
| (c) | The rate shown is the annualized seven day yield as of March 31, 2021. |
The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor's Financial Services LLC or were otherwise determined by the Advisor to be appropriate. This information is unaudited.
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
62
Brandes Small Cap Value Fund
SCHEDULE OF INVESTMENTS BY COUNTRY — March 31, 2021
| COMMON STOCKS | |
Brazil | 2.70% |
Canada | 3.10% |
Ireland | 1.20% |
United States | 80.23% |
TOTAL COMMON STOCKS | 87.23% |
| CORPORATE BONDS | |
United States | 1.18% |
TOTAL CORPORATE BONDS | 1.18% |
| WARRANTS | |
United States | 1.15% |
TOTAL WARRANTS | 1.15% |
SHORT-TERM INVESTMENTS | 11.16% |
TOTAL INVESTMENTS | 100.72% |
Liabilities in Excess of Other Assets | (0.72)% |
TOTAL NET ASSETS | 100.00% |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
63
Brandes Core Plus Fixed Income Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited)
| Shares | Value | |
| COMMON STOCKS – 0.00% | ||
| Household Durables – 0.00% | ||
Urbi Desarrollos Urbanos SAB de CV (a) | 1,564 | $ 627 |
TOTAL COMMON STOCKS (Cost $292,050) | $ 627 | |
| Principal Amount | Value | |
| FEDERAL AND FEDERALLY SPONSORED CREDITS – 7.79% | ||
| Federal Home Loan Mortgage Corporation – 2.58% | ||
Pool A9-3505 4.500%, 8/1/2040 | 64,970 | $ 72,903 |
Pool G0-6018 6.500%, 4/1/2039 | 18,031 | 20,809 |
Pool G1-8578 3.000%, 12/1/2030 | 884,333 | 935,478 |
Pool SD-8001 3.500%, 7/1/2049 | 395,544 | 417,263 |
Pool SD-8003 4.000%, 7/1/2049 | 470,640 | 504,678 |
| 1,951,131 | ||
| Federal National Mortgage Association – 5.21% | ||
Pool 934124 5.500%, 7/1/2038 | 38,505 | 44,908 |
Pool AL9865 3.000%, 2/1/2047 | 1,032,811 | 1,084,484 |
Pool AS6201 3.500%, 11/1/2045 | 398,220 | 427,533 |
Pool BJ2553 3.500%, 12/1/2047 | 332,507 | 352,949 |
Pool BN6683 3.500%, 6/1/2049 | 738,589 | 779,636 |
Pool CA1624 3.000%, 4/1/2033 | 663,713 | 705,725 |
Pool MA0918 4.000%, 12/1/2041 | 152,719 | 169,069 |
Pool MA3687 4.000%, 6/1/2049 | 343,798 | 368,616 |
| 3,932,920 | ||
TOTAL FEDERAL AND FEDERALLY SPONSORED CREDITS (Cost $5,573,174) | $ 5,884,051 | |
| OTHER MORTGAGE RELATED SECURITIES – 0.00% | ||
| Collateralized Mortgage Obligations – 0.00% | ||
Wells Fargo Mortgage Backed Securities Trust Series 2006-AR14 3.080%, 10/25/2036(b) | 606 | $ 580 |
TOTAL OTHER MORTGAGE RELATED SECURITIES (Cost $597) | $ 580 | |
| US GOVERNMENTS – 49.43% | ||
| Sovereign – 49.43% | ||
United States Treasury Note | ||
2.375%, 8/15/2024 | 6,360,000 | $ 6,766,941 |
2.250%, 2/15/2027 | 10,075,000 | 10,695,636 |
2.375%, 5/15/2029 | 9,900,000 | 10,512,562 |
United States Treasury Bond | ||
4.750%, 2/15/2037 | 5,775,000 | 7,886,484 |
3.500%, 2/15/2039 | 1,250,000 | 1,495,752 |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
64
Brandes Core Plus Fixed Income Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Principal Amount | Value | |
TOTAL US GOVERNMENTS (Cost $36,157,313) | $ 37,357,375 | |
| CORPORATE BONDS – 39.02% | ||
| Automobiles – 1.52% | ||
Ford Motor Credit Co. LLC | ||
5.875%, 8/2/2021 | 410,000 | $ 415,515 |
3.350%, 11/1/2022 | 370,000 | 377,474 |
3.375%, 11/13/2025 | 350,000 | 355,950 |
| 1,148,939 | ||
| Banks – 6.98% | ||
Fifth Third Bancorp 8.250%, 3/1/2038 | 175,000 | 281,981 |
Goldman Sachs Group, Inc. 3.000%, 4/26/2022 | 780,000 | 781,220 |
JPMorgan Chase & Co. 3.682% (3M LIBOR + 3.470%), Perpetual(c) | 1,317,000 | 1,314,695 |
USB Capital IX 3.500% (3M LIBOR + 1.020%, minimum of 3.500%), Perpetual(c) | 1,830,000 | 1,756,800 |
Wells Fargo & Co. 2.100%, 7/26/2021 | 1,130,000 | 1,136,447 |
| 5,271,143 | ||
| Commercial Services & Supplies – 3.15% | ||
Iron Mountain, Inc. 4.875%, 9/15/2027(d) | 645,000 | 659,915 |
Prime Security Services Borrower LLC | ||
5.750%, 4/15/2026(d) | 715,000 | 771,646 |
6.250%, 1/15/2028(d) | 915,000 | 952,506 |
| 2,384,067 | ||
| Consumer Products – 3.23% | ||
Avon Products, Inc. 6.500%, 3/15/2023 | 1,625,000 | 1,730,625 |
Travel + Leisure Co. 3.900%, 3/1/2023 | 690,000 | 711,425 |
| 2,442,050 | ||
| Containers & Packaging – 0.58% | ||
Sealed Air Corp. 4.000%, 12/1/2027(d) | 430,000 | 440,213 |
| Electric Utilities – 0.73% | ||
Commonwealth Edison Co. 5.900%, 3/15/2036 | 175,000 | 232,719 |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
65
Brandes Core Plus Fixed Income Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Principal Amount | Value | |
FirstEnergy Corp. 7.375%, 11/15/2031 | 240,000 | $ 320,930 |
| 553,649 | ||
| Equipment – 0.03% | ||
Continental Airlines Pass Through Trust Series 2007-1 5.983%, 4/19/2022 | 20,751 | 21,181 |
| Food, Beverage & Tobacco – 2.25% | ||
Pilgrim's Pride Corp. | ||
5.750%, 3/15/2025(d) | 835,000 | 852,201 |
5.875%, 9/30/2027(d) | 210,000 | 225,057 |
4.250%, 4/15/2031(d) | 625,000 | 622,644 |
| 1,699,902 | ||
| Health Care Facilities & Services – 1.78% | ||
Tenet Healthcare Corp. | ||
5.125%, 5/1/2025 | 270,000 | 273,793 |
4.875%, 1/1/2026(d) | 1,030,000 | 1,070,541 |
| 1,344,334 | ||
| Homebuilders – 2.61% | ||
PulteGroup, Inc. 5.500%, 3/1/2026 | 980,000 | 1,143,439 |
Toll Brothers Finance Corp. 4.875%, 11/15/2025 | 745,000 | 829,744 |
| 1,973,183 | ||
| Media – 0.93% | ||
Charter Communications Operating LLC 4.908%, 7/23/2025 | 295,000 | 334,577 |
Netflix, Inc. 4.375%, 11/15/2026 | 330,000 | 368,692 |
| 703,269 | ||
| Oil, Gas & Consumable Fuels – 9.20% | ||
BP Capital Markets Plc 3.506%, 3/17/2025 | 810,000 | 882,761 |
Chevron Corp. 2.100%, 5/16/2021 | 1,150,000 | 1,151,427 |
Continental Resources, Inc. | ||
4.500%, 4/15/2023 | 355,000 | 367,673 |
4.375%, 1/15/2028 | 215,000 | 227,051 |
Exxon Mobil Corp. 2.397%, 3/6/2022 | 945,000 | 960,413 |
Kinder Morgan, Inc. 4.300%, 6/1/2025 | 1,054,000 | 1,176,606 |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
66
Brandes Core Plus Fixed Income Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Principal Amount | Value | |
Occidental Petroleum Corp. | ||
1.644% (3M LIBOR + 1.450%), 8/15/2022(c) | 365,000 | $ 361,150 |
3.500%, 6/15/2025 | 555,000 | 549,450 |
Range Resources Corp. 5.000%, 3/15/2023 | 1,256,000 | 1,276,410 |
| 6,952,941 | ||
| Technology – 3.10% | ||
Microsoft Corp. 2.400%, 2/6/2022 | 1,000,000 | 1,016,470 |
VMware, Inc. | ||
4.500%, 5/15/2025 | 215,000 | 239,712 |
3.900%, 8/21/2027 | 995,000 | 1,085,782 |
| 2,341,964 | ||
| Telecommunications – 2.93% | ||
AT&T, Inc. 3.000%, 6/30/2022 | 1,630,000 | 1,675,310 |
Telecom Italia Capital SA 6.375%, 11/15/2033 | 185,000 | 219,225 |
T-Mobile USA, Inc. 4.750%, 2/1/2028 | 300,000 | 320,595 |
| 2,215,130 | ||
TOTAL CORPORATE BONDS (Cost $27,975,898) | $ 29,491,965 | |
| ASSET BACKED SECURITIES – 1.89% | ||
| Student Loan – 1.89% | ||
SLM Private Credit Student Loan Trust Series 2007-A, 0.424%, (3M LIBOR + 0.240%), 12/16/2041(c) | 226,890 | $ 220,924 |
SLM Private Credit Student Loan Trust Series 2004-B, 0.614%, (3M LIBOR + 0.430%), 9/15/2033(c) | 300,000 | 291,750 |
SLM Private Credit Student Loan Trust Series 2005-A, 0.494%, (3M LIBOR + 0.310%), 12/15/2038(c) | 358,636 | 353,385 |
SLM Private Credit Student Loan Trust Series 2006-A, 0.474%, (3M LIBOR + 0.290%), 6/15/2039(c) | 571,808 | 558,648 |
TOTAL ASSET BACKED SECURITIES (Cost $1,345,778) | $ 1,424,707 | |
| Shares | Value | |
| WARRANTS – 0.12% | ||
| Oil, Gas & Consumable Fuels – 0.12% | ||
Chesapeake Energy Corp., Exp. 02/09/2026, Strike $27.63 (a) | 4,411 | $ 90,955 |
TOTAL WARRANTS (Cost $20,554) | $ 90,955 | |
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
67
Brandes Core Plus Fixed Income Fund
SCHEDULE OF INVESTMENTS — March 31, 2021 (Unaudited) (continued)
| Shares | Value | |
| SHORT-TERM INVESTMENTS – 1.92% | ||
| Money Market Funds – 1.92% | ||
Northern Institutional Funds - Treasury Portfolio (Premier), 0.01%(e) | 1,453,280 | $ 1,453,280 |
TOTAL SHORT-TERM INVESTMENTS (Cost $1,453,280) | $ 1,453,280 | |
Total Investments (Cost $72,818,644) – 100.17% | $75,703,540 | |
Liabilities in Excess of Other Assets – (0.17)% | (127,502) | |
Total Net Assets – 100.00% | $75,576,038 | |
| Percentages are stated as a percent of net assets. | ||
| LIBOR London Interbank Offered Rate | ||
| (a) | Non-income producing security. |
| (b) | Variable rate security. The coupon is based on an underlying pool of loans. |
| (c) | Variable rate security. The coupon is based on a reference index and spread index. |
| (d) | Acquired in a transaction exempt from registration under Rule 144A or Section 4(a)(2) of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $5,594,722 which represented 7.40% of the net assets of the Fund. |
| (e) | The rate shown is the annualized seven day yield as of March 31, 2021. |
The industry classifications represented in the Schedule of Investments are in accordance with Bloomberg Industry Classification Standards (BICS) or were otherwise determined by the Advisor to be appropriate. This information is unaudited.
The accompanying notes to financial statements are an integral part of these Schedule of Investments.
68
Brandes Investment Trust
STATEMENTS OF ASSETS AND LIABILITIES — March 31, 2021 (Unaudited)
| Brandes International Equity Fund | Brandes Global Equity Fund | ||
| ASSETS | |||
| Investment in securities, at value(1) | |||
Unaffiliated issuers | $ 619,738,745 | $41,189,135 | |
Affiliated issuers | — | — | |
Foreign Currency(1) | 238,392 | 25,299 | |
| Receivables: | |||
Securities sold | 1,731,063 | — | |
Fund shares sold | 174,758 | 6,117 | |
Dividends and interest | 2,406,821 | 130,111 | |
Tax reclaims | 1,329,024 | 60,360 | |
Securities lending | 7,116 | — | |
Due from Advisor | 24,525 | 6,741 | |
Receivable from service providers | 33,650 | 1,696 | |
Prepaid expenses and other assets | 56,698 | 33,249 | |
Total Assets | 625,740,792 | 41,452,708 | |
| LIABILITIES | |||
| Payables: | |||
Securities purchased | 3,461,786 | 279,186 | |
Fund shares redeemed | 5,333,256 | 181,765 | |
Due to Advisor | 393,462 | 27,653 | |
12b-1 Fee | 11,797 | 735 | |
Trustee Fees | 18,141 | 1,213 | |
Custodian Fee Payable | 25,367 | 2,420 | |
Foreign capital gains taxes | — | — | |
Dividends payable | 191,891 | 2,373 | |
Accrued expenses | 372,557 | 96,725 | |
Total Liabilities | 9,808,257 | 592,070 | |
NET ASSETS | $ 615,932,535 | $40,860,638 | |
| COMPONENTS OF NET ASSETS | |||
Paid in Capital | $ 719,714,733 | $31,947,315 | |
Total distributable earnings (loss) | (103,782,198) | 8,913,323 | |
Total Net Assets | $ 615,932,535 | $40,860,638 | |
| Net asset value, offering price and redemption proceeds per share | |||
| Class A Shares | |||
Net Assets | $ 27,209,611 | $ 735,971 | |
Shares outstanding (unlimited shares authorized without par value) | 1,527,519 | 28,392 | |
Offering and redemption price | $ 17.81 | $ 25.92 | |
Maximum offering price per share* | $ 18.90 | $ 27.50 | |
| Class C Shares | |||
Net Assets | $ 9,459,912 | $ 913,133 | |
Shares outstanding (unlimited shares authorized without par value) | 541,136 | 35,526 | |
Offering and redemption price | $ 17.48 | $ 25.70 | |
| Class I Shares | |||
Net Assets | $ 524,955,241 | $39,211,534 | |
Shares outstanding (unlimited shares authorized without par value) | 29,331,189 | 1,499,465 | |
Offering and redemption price | $ 17.90 | $ 26.15 | |
| Class R6 Shares | |||
Net Assets | $ 54,307,771 | $ N/A | |
Shares outstanding (unlimited shares authorized without par value) | 3,017,468 | N/A | |
Offering and redemption price | $ 18.00 | $ N/A | |
| (1)Cost of: | |||
| Investments in securities | |||
Unaffiliated issuers | $ 636,170,570 | $32,662,906 | |
Affiliated issuers | — | — | |
Foreign currency | 238,392 | 25,299 |
| * | Includes a sales load of 5.75% for the International, Global, Emerging Markets, International Small Cap, and Small Cap Value Funds and 3.75% for the Core Plus Fund. (see Note 7 of the Notes to Financial Statements) |
The accompanying notes to financial statements are an integral part of this statement.
70
Brandes Investment Trust
STATEMENTS OF ASSETS AND LIABILITIES — March 31, 2021 (Unaudited) (continued)
| Brandes Emerging Markets Value Fund | Brandes International Small Cap Equity Fund | Brandes Small Cap Value Fund | Brandes Core Plus Fixed Income Fund | ||||
| $1,325,462,233 | $ 388,812,298 | $2,286,201 | $75,703,540 | ||||
| — | 747,640 | — | — | ||||
| 313,641 | 141 | — | — | ||||
| 1,452,544 | 8,552,546 | 4,908 | — | ||||
| 1,965,375 | 21,567 | 4,001 | 98,671 | ||||
| 4,963,095 | 1,182,714 | 1,769 | 553,514 | ||||
| 119,255 | 481,976 | — | — | ||||
| — | — | — | — | ||||
| 4,737 | 694 | 8,683 | 21,183 | ||||
| 67,922 | 16,936 | 24 | 3,773 | ||||
| 88,241 | 51,352 | 32,447 | 36,328 | ||||
| 1,334,437,043 | 399,867,864 | 2,338,033 | 76,417,009 | ||||
| 856,024 | 56,132 | 28,479 | 618,712 | ||||
| 1,359,703 | 10,995,979 | 471 | 69,247 | ||||
| 1,081,215 | 319,599 | 1,222 | 22,596 | ||||
| 54,390 | 17,226 | 48 | 249 | ||||
| 41,141 | 12,240 | 44 | 2,649 | ||||
| 78,312 | 22,183 | 1,862 | 2,175 | ||||
| 2,377,946 | — | — | — | ||||
| — | 816 | 1 | 3,730 | ||||
| 684,268 | 352,516 | 36,044 | 121,613 | ||||
| 6,532,999 | 11,776,691 | 68,171 | 840,971 | ||||
| $1,327,904,044 | $ 388,091,173 | $2,269,862 | $75,576,038 | ||||
| $1,530,001,927 | $ 550,003,148 | $2,105,491 | $74,423,702 | ||||
| (202,097,883) | (161,911,975) | 164,371 | 1,152,336 | ||||
| $1,327,904,044 | $ 388,091,173 | $2,269,862 | $75,576,038 | ||||
| $ 218,085,406 | $ 65,637,925 | $ 293,166 | $ 1,099,604 | ||||
| 24,575,515 | 5,111,682 | 23,629 | 118,583 | ||||
| $ 8.87 | $ 12.84 | $ 12.41 | $ 9.27 | ||||
| $ 9.41 | $ 13.62 | $ 13.17 | $ 9.63 | ||||
| $ 11,984,242 | $ 5,241,744 | $ N/A | $ N/A | ||||
| 1,361,222 | 423,361 | N/A | N/A | ||||
| $ 8.80 | $ 12.38 | $ N/A | $ N/A | ||||
| $1,023,087,423 | $ 304,107,406 | $1,976,550 | $74,476,334 | ||||
| 114,568,565 | 23,573,790 | 158,068 | 7,963,897 | ||||
| $ 8.93 | $ 12.90 | $ 12.50 | $ 9.35 | ||||
| $ 74,746,973 | $ 13,104,098 | $ 146 | $ 100 | ||||
| 8,324,530 | 1,013,038 | 12 | 10 | ||||
| $ 8.98 | $ 12.94 | $ 11.70 | $ 9.36 | ||||
| $1,405,047,226 | $ 346,307,336 | $2,018,646 | $72,818,644 | ||||
| — | 30,882,874 | — | — | ||||
| 313,641 | 142 | — | — | ||||
| $ — | $ — | $ — | $— |
The accompanying notes to financial statements are an integral part of this statement.
71
Brandes Investment Trust
STATEMENTS OF OPERATIONS — For the Six Months Ended March 31, 2021 (Unaudited)
| Brandes International Equity Fund | Brandes Global Equity Fund | ||
| INVESTMENT INCOME | |||
| Income | |||
| Dividend income | |||
Unaffiliated issuers | $ 9,336,978 | $ 653,682 | |
Non Cash Dividends | — | — | |
Less: Foreign taxes withheld | (562,722) | (24,263) | |
Interest income | — | 11 | |
Income from securities lending | 85,087 | 1,258 | |
Total Income | 8,859,343 | 630,688 | |
| Expenses | |||
Advisory fees (Note 3) | 2,044,566 | 144,372 | |
Custody fees | 28,709 | 2,388 | |
Administration fees (Note 3) | 62,642 | 8,802 | |
Insurance expense | 10,072 | 601 | |
Legal fees | 21,911 | 1,446 | |
Printing fees | 21,464 | 2,135 | |
Miscellaneous | 37,145 | 4,906 | |
Registration expense | 35,759 | 25,143 | |
Trustees fees | 33,085 | 2,183 | |
Transfer agent fees | 57,657 | 3,817 | |
12b-1 Fees – Class A | 31,557 | 878 | |
12b-1 Fees – Class C | 32,353 | 3,076 | |
Shareholder Service Fees – Class C | 10,784 | 1,026 | |
Sub-Transfer Agency Fees – Class I | 114,400 | 8,643 | |
Auditing fees | 23,862 | 21,668 | |
Total expenses | 2,565,966 | 231,084 | |
Expenses waived by Advisor | (165,818) | (43,939) | |
Expenses recouped | — | — | |
Expenses waived by Service Providers | (33,650) | (1,696) | |
Total net expenses | 2,366,498 | 185,449 | |
Net investment income | 6,492,845 | 445,239 | |
| REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS | |||
| Net realized gain (loss) on: | |||
Unaffiliated investments | (16,445,606) | 1,029,057 | |
Affiliated investments | — | — | |
Foreign currency transactions | 43,671 | (35) | |
Net realized gain (loss) | (16,401,935) | 1,029,022 | |
| Net change in unrealized appreciation (depreciation) on: | |||
Unaffiliated investments (net of increase in estimated foreign capital gains taxes of $2,377,946 for the Emerging Markets Fund) | 160,999,356 | 9,737,958 | |
Affiliated investments | — | — | |
Foreign currency transactions | (55,216) | (2,484) | |
Net change in unrealized appreciation (depreciation) | 160,944,140 | 9,735,474 | |
Net realized and unrealized gain (loss) on investments and foreign currency transactions | 144,542,205 | 10,764,496 | |
Net increase (decrease) in net assets resulting from operations | $151,035,050 | $11,209,735 |
The accompanying notes to financial statements are an integral part of this statement.
72
Brandes Investment Trust
STATEMENTS OF OPERATIONS — For the Six Months Ended March 31, 2021 (Unaudited)
(continued)
| Brandes Emerging Markets Value Fund | Brandes International Small Cap Equity Fund | Brandes Small Cap Value Fund | Brandes Core Plus Fixed Income Fund | |||
| $ 16,061,565 | $ 3,490,168 | $ 11,050 | $ 45 | |||
| — | — | 3,038 | — | |||
| (2,659,825) | (336,550) | — | — | |||
| — | — | 171 | 1,051,044 | |||
| — | 9,639 | — | — | |||
| 13,401,740 | 3,163,257 | 14,259 | 1,051,089 | |||
| 5,855,843 | 1,755,521 | 4,127 | 143,982 | |||
| 92,716 | 24,577 | 1,303 | 1,649 | |||
| 135,361 | 44,072 | 5,110 | 13,689 | |||
| 21,222 | 6,050 | — | 1,446 | |||
| 49,840 | 14,958 | 87 | 3,444 | |||
| 53,449 | 15,132 | 1,306 | 6,382 | |||
| 86,985 | 31,127 | 2,438 | 7,852 | |||
| 50,410 | 30,274 | 19,074 | 22,864 | |||
| 75,243 | 22,595 | 68 | 5,186 | |||
| 130,376 | 39,086 | 125 | 8,704 | |||
| 254,991 | 69,608 | 96 | 1,601 | |||
| 45,646 | 18,612 | — | — | |||
| 15,215 | 6,204 | — | — | |||
| 236,746 | 74,238 | 275 | 20,249 | |||
| 22,311 | 21,888 | 19,853 | 21,364 | |||
| 7,126,354 | 2,173,942 | 53,862 | 258,412 | |||
| (29,705) | (4,589) | (48,402) | (109,447) | |||
| 66,402 | 14,808 | — | — | |||
| (67,922) | (16,936) | (24) | (24,342) | |||
| 7,095,129 | 2,167,225 | 5,436 | 124,623 | |||
| 6,306,611 | 996,032 | 8,823 | 926,466 | |||
| 12,073,598 | 7,433,093 | 74,941 | 2,018,377 | |||
| — | (1,197) | — | — | |||
| (36,686) | (59,970) | (30) | — | |||
| 12,036,912 | 7,371,926 | 74,911 | 2,018,377 | |||
| 256,486,444 | 111,409,639 | 297,496 | (3,702,825) | |||
| — | (261,936) | — | — | |||
| (128,640) | (27,614) | — | — | |||
| 256,357,804 | 111,120,089 | 297,496 | (3,702,825) | |||
| 268,394,716 | 118,492,015 | 372,407 | (1,684,448) | |||
| $274,701,327 | $119,488,047 | $381,230 | $ (757,982) |
The accompanying notes to financial statements are an integral part of this statement.
73
Brandes Investment Trust
STATEMENT OF CHANGES IN NET ASSETS
| Brandes International Equity Fund | Brandes Global Equity Fund | ||||||
| Six Months Ended March 31, 2021 (Unaudited) | Year Ended September 30, 2020 | Six Months Ended March 31, 2021 (Unaudited) | Year Ended September 30, 2020 | ||||
| INCREASE (DECREASE) IN NET ASSETS FROM: | |||||||
| OPERATIONS | |||||||
Net investment income | $ 6,492,845 | $ 11,973,556 | $ 445,239 | $ 582,146 | |||
| Net realized gain (loss) on: | |||||||
Investments | (16,445,606) | (61,359,277) | 1,029,057 | 982,919 | |||
Foreign currency transactions | 43,671 | (151,301) | (35) | (7,480) | |||
| Net unrealized appreciation (depreciation) on: | |||||||
Investments | 160,999,356 | (53,936,184) | 9,737,958 | (4,789,985) | |||
Foreign currency transactions | (55,216) | 130,348 | (2,484) | 4,758 | |||
Net increase (decrease) in net assets resulting from operations | 151,035,050 | (103,342,858) | 11,209,735 | (3,227,642) | |||
| DISTRIBUTIONS TO SHAREHOLDERS | |||||||
| Distributions to shareholders | |||||||
Class A | (194,338) | (633,619) | (15,770) | (23,271) | |||
Class C | (40,324) | (193,760) | (17,104) | (11,406) | |||
Class I | (4,134,001) | (13,239,310) | (854,185) | (643,170) | |||
Class R6 | (453,270) | (1,236,134) | N/A | N/A | |||
Decrease in net assets from distributions | (4,821,933) | (15,302,823) | (887,059) | (677,847) | |||
| CAPITAL SHARE TRANSACTIONS | |||||||
Proceeds from shares sold | 99,351,532 | 238,453,291 | 2,936,635 | 902,634 | |||
Net asset value of shares issued on reinvestment of distributions | 4,576,160 | 14,391,141 | 879,300 | 670,579 | |||
Cost of shares redeemed | (113,401,077) | (358,370,424) | (3,484,346) | (3,533,160) | |||
Net increase (decrease) in net assets from capital share transactions | (9,473,385) | (105,525,992) | 331,589 | (1,959,947) | |||
Total increase (decrease) in net assets | 136,739,732 | (224,171,673) | 10,654,265 | (5,865,436) | |||
| NET ASSETS | |||||||
Beginning of the Period | 479,192,803 | 703,364,476 | 30,206,373 | 36,071,809 | |||
End of the Period | $ 615,932,535 | $ 479,192,803 | $40,860,638 | $30,206,373 | |||
The accompanying notes to financial statements are an integral part of this statement.
74
Brandes Investment Trust
STATEMENT OF CHANGES IN NET ASSETS (continued)
| Brandes Emerging Markets Value Fund | Brandes International Small Cap Equity Fund | ||||||
| Six Months Ended March 31, 2021 (Unaudited) | Year Ended September 30, 2020 | Six Months Ended March 31, 2021 (Unaudited) | Year Ended September 30, 2020 | ||||
| INCREASE (DECREASE) IN NET ASSETS FROM: | |||||||
| OPERATIONS | |||||||
Net investment income | $ 6,306,611 | $ 22,914,468 | $ 996,032 | $ 3,010,129 | |||
| Net realized gain (loss) on: | |||||||
Investments | 12,073,598 | (108,076,408) | 7,431,896 | (45,423,208) | |||
Foreign currency transactions | (36,686) | (910,849) | (59,970) | 44,369 | |||
| Net unrealized appreciation (depreciation) on: | |||||||
Investments | 256,486,444 | (154,143,873) | 111,147,703 | 15,180,645 | |||
Foreign currency transactions | (128,640) | 10,413 | (27,614) | 34,389 | |||
Net increase (decrease) in net assets resulting from operations | 274,701,327 | (240,206,249) | 119,488,047 | (27,153,676) | |||
| DISTRIBUTIONS TO SHAREHOLDERS | |||||||
| Distributions to shareholders | |||||||
Class A | — | (4,338,344) | (200,774) | (283,816) | |||
Class C | — | (208,593) | (15,307) | (29,177) | |||
Class I | — | (22,968,401) | (1,193,611) | (2,517,835) | |||
Class R6 | — | (1,065,052) | (52,305) | (119,547) | |||
Decrease in net assets from distributions | — | (28,580,390) | (1,461,997) | (2,950,375) | |||
| CAPITAL SHARE TRANSACTIONS | |||||||
Proceeds from shares sold | 215,649,919 | 506,169,480 | 38,445,778 | 97,928,290 | |||
Net asset value of shares issued on reinvestment of distributions | — | 26,396,697 | 1,456,141 | 2,829,694 | |||
Cost of shares redeemed | (221,601,349) | (623,820,599) | (81,399,836) | (244,687,795) | |||
Net increase (decrease) in net assets from capital share transactions | (5,951,430) | (91,254,422) | (41,497,917) | (143,929,811) | |||
Total increase (decrease) in net assets | 268,749,897 | (360,041,061) | 76,528,133 | (174,033,862) | |||
| NET ASSETS | |||||||
Beginning of the Period | 1,059,154,147 | 1,419,195,208 | 311,563,040 | 485,596,902 | |||
End of the Period | $1,327,904,044 | $1,059,154,147 | $388,091,173 | $ 311,563,040 | |||
The accompanying notes to financial statements are an integral part of this statement.
75
Brandes Investment Trust
STATEMENT OF CHANGES IN NET ASSETS (continued)
| Brandes Small Cap Value Fund | Brandes Core Plus Fixed Income Fund | ||||||
| Six Months Ended March 31, 2021 (Unaudited) | Year Ended September 30, 2020 | Six Months Ended March 31, 2021 (Unaudited) | Year Ended September 30, 2020 | ||||
| INCREASE (DECREASE) IN NET ASSETS FROM: | |||||||
| OPERATIONS | |||||||
Net investment income | $ 8,823 | $ 8,325 | $ 926,466 | $ 2,050,242 | |||
| Net realized gain (loss) on: | |||||||
Investments | 74,941 | 21,006 | 2,018,377 | (1,658,866) | |||
Foreign currency transactions | (30) | 156 | — | — | |||
| Net unrealized appreciation (depreciation) on: | |||||||
Investments | 297,496 | (22,544) | (3,702,825) | 4,583,064 | |||
Foreign currency transactions | — | — | — | — | |||
Net increase (decrease) in net assets resulting from operations | 381,230 | 6,943 | (757,982) | 4,974,440 | |||
| DISTRIBUTIONS TO SHAREHOLDERS | |||||||
| Distributions to shareholders | |||||||
Class A | (934) | (95) | (19,202) | (37,997) | |||
Class C | N/A | N/A | N/A | N/A | |||
Class I | (17,768) | (2,749) | (1,274,029) | (1,911,433) | |||
Class R6 | (2) | N/A | (2) | (3) | |||
Decrease in net assets from distributions | (18,704) | (2,844) | (1,293,233) | (1,949,433) | |||
| CAPITAL SHARE TRANSACTIONS | |||||||
Proceeds from shares sold | 1,418,690 | 125,305 | 12,369,711 | 12,809,224 | |||
Net asset value of shares issued on reinvestment of distributions | 18,702 | 2,844 | 1,263,057 | 1,913,508 | |||
Cost of shares redeemed | (79,651) | (63,782) | (22,816,690) | (17,487,590) | |||
Net increase (decrease) in net assets from capital share transactions | 1,357,741 | 64,367 | (9,183,922) | (2,764,858) | |||
Total increase (decrease) in net assets | 1,720,267 | 68,466 | (11,235,137) | 260,149 | |||
| NET ASSETS | |||||||
Beginning of the Period | 549,595 | 481,129 | 86,811,175 | 86,551,026 | |||
End of the Period | $2,269,862 | $549,595 | $ 75,576,038 | $ 86,811,175 | |||
The accompanying notes to financial statements are an integral part of this statement.
76
Brandes Investment Trust
FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:
| Net asset value, beginning of period | Net investment income(1) | Net realized and unrealized gain (loss) on investments | Total from investment operations | Dividends from net investment income | Net asset value, end of period | |
| Brandes International Equity Fund | ||||||
| Class A | ||||||
3/31/2021 (Unaudited) | $13.51 | 0.17 | 4.26 | 4.43 | (0.13) | $17.81 |
9/30/2020 | $16.02 | 0.26 | (2.40) | (2.14) | (0.37) | $13.51 |
9/30/2019 | $17.71 | 0.53 | (1.59) | (1.06) | (0.63) | $16.02 |
9/30/2018 | $17.48 | 0.36 | 0.17 | 0.53 | (0.30) | $17.71 |
9/30/2017 | $15.70 | 0.29 | 2.03 | 2.32 | (0.54) | $17.48 |
9/30/2016 | $14.90 | 0.35 | 0.81 | 1.16 | (0.36) | $15.70 |
| Class C | ||||||
3/31/2021 (Unaudited) | $13.27 | 0.11 | 4.17 | 4.28 | (0.07) | $17.48 |
9/30/2020 | $15.76 | 0.13 | (2.33) | (2.20) | (0.29) | $13.27 |
9/30/2019 | $17.47 | 0.40 | (1.58) | (1.18) | (0.53) | $15.76 |
9/30/2018 | $17.30 | 0.22 | 0.18 | 0.40 | (0.23) | $17.47 |
9/30/2017 | $15.58 | 0.17 | 2.00 | 2.17 | (0.45) | $17.30 |
9/30/2016 | $14.79 | 0.23 | 0.81 | 1.04 | (0.25) | $15.58 |
| Class I | ||||||
3/31/2021 (Unaudited) | $13.57 | 0.19 | 4.28 | 4.47 | (0.14) | $17.90 |
9/30/2020 | $16.07 | 0.27 | (2.37) | (2.10) | (0.40) | $13.57 |
9/30/2019 | $17.76 | 0.56 | (1.60) | (1.04) | (0.65) | $16.07 |
9/30/2018 | $17.52 | 0.40 | 0.16 | 0.56 | (0.32) | $17.76 |
9/30/2017 | $15.72 | 0.33 | 2.04 | 2.37 | (0.57) | $17.52 |
9/30/2016 | $14.92 | 0.38 | 0.81 | 1.19 | (0.39) | $15.72 |
| Class R6 | ||||||
3/31/2021 (Unaudited) | $13.64 | 0.20 | 4.31 | 4.51 | (0.15) | $18.00 |
9/30/2020 | $16.15 | 0.36 | (2.47) | (2.11) | (0.40) | $13.64 |
9/30/2019 | $17.83 | 0.59 | (1.61) | (1.02) | (0.66) | $16.15 |
9/30/2018 | $17.56 | 0.42 | 0.18 | 0.60 | (0.33) | $17.83 |
9/30/2017 | $15.74 | 0.35 | 2.04 | 2.39 | (0.57) | $17.56 |
2/1/2016(9) – 9/30/2016 | $14.41 | 0.27 | 1.39 | 1.66 | (0.33) | $15.74 |
| (1) | Net investment income per share has been calculated based on average shares outstanding during the period. |
| (2) | The total return calculation does not reflect the sales loads that may be imposed on Class A or C shares (see Note 7 of the Notes to Financial Statements). |
| (3) | After fees waived and expenses absorbed or recouped by the Advisor, where applicable. |
| (4) | Not annualized. |
| (5) | Annualized. |
| (6) | Includes expenses not covered by the Trust’s expense limitation agreement. |
| (7) | As of June 30, 2019, the expense cap for the class changed from 1.00% to 0.85%. |
| (8) | As of June 30, 2019, the expense cap for the class changed from 0.82% to 0.75%. |
| (9) | Commencement of operations. |
| (10) | The total return figure is the since inception return for the class. |
The accompanying notes to financial statements are an integral part of this statement.
78
Brandes Investment Trust
FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:
| Total return(2) | Net assets, end of period (millions) | Ratio of net expenses to average net assets(3) | Ratio of net investment income to average net assets(3) | Ratio of expenses (prior to reimburse-ments) to average net assets | Ratio of net investment income (prior to reimburse-ments) to average net assets | Portfolio turnover rate |
| 32.78% (4) | $ 27.2 | 1.11% (5) | 2.09% (5) | 1.12% (5) | 2.08% (5) | 18.00% (4) |
| (13.42)% | $ 22.1 | 1.13% | 1.80% | 1.14% | 1.79% | 23.20% |
| (5.98)% | $ 32.0 | 1.16% | 3.21% | 1.16% | 3.21% | 14.43% |
| 3.02% | $ 34.9 | 1.16% | 2.00% | 1.16% | 2.00% | 20.37% |
| 15.07% | $ 31.5 | 1.18% (6) | 1.77% | 1.18% (6) | 1.77% | 33.82% |
| 7.90% | $ 14.3 | 1.18% | 2.30% | 1.18% | 2.30% | 17.60% |
| 32.29% (4) | $ 9.5 | 1.86% (5) | 1.35% (5) | 1.87% (5) | 1.34% (5) | 18.00% (4) |
| (14.06)% | $ 7.6 | 1.88% | 1.01% | 1.89% | 1.00% | 23.20% |
| (6.73)% | $ 13.1 | 1.91% | 2.46% | 1.91% | 2.46% | 14.43% |
| 2.31% | $ 18.3 | 1.91% | 1.25% | 1.91% | 1.25% | 20.37% |
| 14.19% | $ 17.9 | 1.93% (6) | 1.01% | 1.93% (6) | 1.01% | 33.82% |
| 7.10% | $ 13.1 | 1.93% | 1.55% | 1.93% | 1.55% | 17.60% |
| 32.98% (4) | $525.0 | 0.85% (5) | 2.40% (5) | 0.92% (5) | 2.33% (5) | 18.00% (4) |
| (13.13)% | $401.7 | 0.85% | 2.03% | 0.94% | 1.94% | 23.20% |
| (5.82)% | $622.4 | 0.94% (7) | 3.43% | 0.96% (7) | 3.41% | 14.43% |
| 3.23% | $664.7 | 0.96% | 2.20% | 0.96% | 2.20% | 20.37% |
| 15.33% | $523.1 | 0.98% (6) | 1.96% | 0.98% (6) | 1.96% | 33.82% |
| 8.10% | $648.3 | 1.00% | 2.48% | 0.98% | 2.50% | 17.60% |
| 33.06% (4) | $ 54.3 | 0.75% (5) | 2.47% (5) | 0.87% (5) | 2.35% (5) | 18.00% (4) |
| (13.08)% | $ 47.8 | 0.75% | 2.35% | 0.89% | 2.21% | 23.20% |
| (5.69)% | $ 35.9 | 0.80% (8) | 3.57% | 0.91% (8) | 3.46% | 14.43% |
| 3.44% | $ 24.6 | 0.82% | 2.34% | 0.91% | 2.25% | 20.37% |
| 15.48% | $ 38.5 | 0.83% (6) | 2.12% | 0.93% (6) | 2.02% | 33.82% |
| 11.60% (10) | $ 27.7 | 0.82% (5) | 2.67% (5) | 0.93% (5) | 2.56% (5) | 17.60% (4) |
The accompanying notes to financial statements are an integral part of this statement.
79
Brandes Investment Trust
FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:
| Net asset value, beginning of period | Net investment income(1) | Net realized and unrealized gain (loss) on investments | Total from investment operations | Dividends from net investment income | Dividends from net realized gains | |
| Brandes Global Equity Fund | ||||||
| Class A | ||||||
3/31/2021 (Unaudited) | $19.30 | 0.24 | 6.94 | 7.18 | (0.26) | (0.30) |
9/30/2020 | $21.75 | 0.28 | (2.33) | (2.05) | (0.40) | — |
9/30/2019 | $24.61 | 0.47 | (1.80) | (1.33) | (0.48) | (1.05) |
9/30/2018 | $24.42 | 0.43 | 0.69 | 1.12 | (0.42) | (0.51) |
9/30/2017 | $21.21 | 0.34 | 3.28 | 3.62 | (0.41) | — |
9/30/2016 | $21.85 | 0.40 | 0.67 | 1.07 | (0.42) | (1.29) |
| Class C | ||||||
3/31/2021 (Unaudited) | $19.16 | 0.17 | 6.85 | 7.02 | (0.18) | (0.30) |
9/30/2020 | $21.60 | 0.17 | (2.35) | (2.18) | (0.26) | — |
9/30/2019 | $24.45 | 0.30 | (1.78) | (1.48) | (0.32) | (1.05) |
9/30/2018 | $24.28 | 0.24 | 0.69 | 0.93 | (0.25) | (0.51) |
9/30/2017 | ||||||