international adr dividend income strategy...altrius maintains a +17 year track record in the...

ALTRIUS CAPITAL MANAGEMENT, INC. | TOLL FREE 855-ALTRIUS | WWW.ALTRIUSCAPITAL.COM

International ADR Dividend Income Strategy3rd Quarter 2020

Q3 20202

Altrius Highlights

Data as of 09.30.2020

FIRM OVERVIEW

Altrius Capital Management, Inc. was founded in 1997

Altrius is 100% employee owned

Altrius is an SEC registered investment advisor

Having managed client assets for over two decades, Altrius claims compliance with Global Investment Performance Standards (GIPS®)

The Firm currently manages approximately $323mm in assets by offering separately managed account solutions

AUM by Product

Disciplined Alpha DividendIncome

International ADR DividendIncome

Unconstrained Fixed Income

Cash

Altrius maintains a +17 year track record in the following strategies: Global Income, Disciplined Alpha Dividend Income and Unconstrained Fixed Income; and a +10 year track record for the International ADR Dividend Income

Chart1

Disciplined Alpha Dividend Income

International ADR Dividend Income



Cash

AUM by Product

AUM by Product

47.4

21.5

0

27.9

3.2

Sheet1

AUM by Product

Disciplined Alpha Dividend Income47.4

International ADR Dividend Income21.5

Unconstrained Fixed Income0

Unconstrained Fixed Income27.9

Cash3.2

To resize chart data range, drag lower right corner of range.

100

Q3 2020

GIPS VerificationACA Verification Services

ComplianceDzuira Compliance Services

TradingMoxy / Advent

AccountingBaccheta & Company

3

Altrius Organization

MANAGEMENT TEAM

INVESTMENT COMMITTEE

OPERATIONS

FIRM OVERVIEW

Zachary Q. Smith, CFAPortfolio Manager

Robert A. D’Angelo, CFAExecutive Vice President

Christopher C. Rolf, CFAExecutive Vice President

James M. RussoChief Investment Strategist

Andrea L. AitkenChief Compliance Officer

Rebecca A. HarmonTrader

Joy G. WoodsDirector of Client Service

Rita A. Hendrick-SmithChief Operations Officer

Lauren TaylorOperations Analyst

Gregory D. Kammerer, J.D.Executive Vice President

Q3 20204

Top down economics drive market cycles, market segments, and ultimately individual security prices.

Total return matters, which includes sources of returns often overlooked by investment managers and investors, such as dividends.

Value is critical; the market will reward the intrinsic value inherent in a security over time.

GLOBAL MACRODRIVES OUR

INVESTMENT ANALYSIS

TOTAL RETURN DRIVES OUR

PORTFOLIO CONSTRUCTION

VALUE DEFINES OUR

SECURITY SELECTION

Different by DesignPHILOSOPHY

Q3 20205

Income is our focus; we employ a flexible investment strategy seeking high,current income and long term capital growth by investing in stocks, bonds andalternative investments such as commodities, MLPs, REITs and preferred issues.

Global macro conditions are the basis for investing; top down economicsdrive market cycles, market segments, and ultimately individual security prices.The strategy retains asset class and sector flexibility to unearth uniqueopportunities.

Value is critical; we will not pay more for a security than we believe it is worth,with full confidence that the market will reward the intrinsic value inherent inthe security over time.

Patience is vital; we do not make extreme short term changes in response tofleeting market events, we invest for the long term and believe returns are drivenby consistency of process.

Risk management is required to ensure long term preservation of capital.

Investment PhilosophyPHILOSOPHY

Q3 20206

At Altrius, we believe that global asset allocation valuations matter. Predicated on this belief, we maintaina series of three economic scenarios under which the economy may fall at any one time. By analyzing thevaluations inherent in the current economic scenario, we are better positioned to identify securities at thesector, industry and individual company level that are best positioned to add significant value to ourportfolio over time.

Source: Advisor Intelligence and Altrius Capital

Economic Scenario AnalysisPHILOSOPHY

ECONOMIC SCENARIOS

Bear Base BullS&P 500 at 3363, Bloomberg Barclays U.S. Aggregate Bond Index yield at 1.20%, MSCI Europe Index at 1596, ICE BofA ML High Yield Cash Pay Index at 5.80%.

Equities Estimate Estimate Estimate

U.S. Equities -10.4% 4.3% 9.1%

Developed Int’l – Europe -10.4% 9.8% 18.6%

REITs -5.4% 4.1% 4.8%

Fixed Income

Investment-Grade Bonds 1.6% 1.2% 0.9%

High-Yield Bonds 1.1% 4.6% 7.2%

TIPS -0.3% -0.2% -0.8%

*Our likely scenario

Q3 2020

Demographic trends and geographic demand are derivatives of global economic growth and serve as drivers for enterprise.

Global Current and Potential Consumption Trends

Source: © 2013 The World Bank: World Development Indicators: United Nations, World Population Prospects; World HealthOrganization, National Health Account database supplemented by country data; and International Energy Agency. As of 2011 (based onmost recent data available, 2010–2011). Health expenditure (US$), electric power consumption (kwh), and energy use (kg of oilequivalent) percentages were calculated by establishing a baseline expenditure/consumption amount of $9,000, 15,000 kWh, and 8,000kg, respectively, and then measuring actual consumption per capita against the baseline.

United States Brazil India China

PotentialCurrent

7

Why Global MattersPHILOSOPHY

Q3 20208


Are domestic companies really domestic anymore? While a company may be headquartered in Germany or Taiwan, investing requires understanding the drivers of a company’s bottom line.

A sampling of major foreign companies with over 60% of total revenues coming from outside the company’s country of domicile

Sources: Data represented is as of the most recent 20-F filing for each company’s respective recent fiscal year end.Foreign Revenue is based on Total Revenue – Domestic Revenue. Logos are trademarks of their respective owners andare used for illustrative purposes and should not be construed as an endorsement or sponsorship of Altrius.

76%

89% 81% 80% 78%

74% 70% 62%

Q3 2020

726.65%

601.43%

More Global Less GlobalSource: © 2014 Ned Davis Research, Inc.

Comparison of S&P 500 Companies’ Returns Cumulative Total Return for the 20-Year Period Ended 06.30.2014

“More Global” represents S&P 500

companies with reported pre-tax income of more than 50% from

foreign operations.

“Less Global” represents S&P 500

companies with reported pre-tax income of less than 50% from

foreign operations.

9

125 percentage points


Q3 202010

Source: Based on Schwert (1990) data for 1801–1870, a blend of Schwert and Siegel (2002)data for 1871–1925, and S&P 500 Index data since 1926.

Over long time periods dividends have made up a large proportion of total returns.

200 Year US Equity Return Decomposition

Why Dividends MatterPHILOSOPHY

Q3 202011

Since Altrius’ inception in 1997, the Firm has been committed to dividend growth, viewing dividends as a critical component of total return.


Source: Federated Advisors

PERCEPTION

Dividends4.2%

Capital Appreciation

5.6%

DividendYield4.2%

DividendGrowth

4.4%

ValuationChanges

1.2%

REALITY

Chart1

Valuation Changes

Dividend Yield

Dividend Growth

Column1

0.012

0.042

0.044

Sheet1

Column1

Valuation Changes1.20%

Dividend Yield4.20%

Dividend Growth4.40%


Chart1

Dividends

Capital Appreciation

Column1

0.042

0.056

Sheet1

Column1

Dividends4%

Capital Appreciation5.60%


Q3 202012

Lower Risk Higher Risk

Low

er R

etur

nH

ighe

r Ret

urn

Dividend Payers Risk/Reward01.31.1972 to 12.31.2016

Source: © 2017 Ned Davis Research, Inc. Non-dividend-paying Stocks represents non-dividend-paying stocks of the S&P 500Index; Dividend Payers w/ No Change represents all dividend-paying stocks of the S&P 500 Index that maintained their existingdividend rate and reflects the reinvestment of all income. The S&P 500 Geometric Equal-Weighted Total Return Index is calculatedusing monthly equal-weighted geometric averages of the total returns of all dividend-paying stocks and non-dividend-paying stocks.

Dividend Cutters or Eliminators

Non-dividend-paying Stocks

Dividend Payers w/ No Change

Dividend Growers & Initiators

-3%

0%

3%

6%

9%

12%

10% 15% 20% 25% 30%

Ave

rage

Ann

ualiz

ed T

otal

Ret

urn

Annualized Standard Deviation


Q3 202013

*Source: Siegel, Jeremy, Future for Investors (2005), with updates through 20171 “What do dividends tell us about earnings quality,” Douglas Skinner, Chicago Booth School of Business

Agency Dilemma

Dividends help reduce problems arising from asymmetric information and conflicts of interest between investors and company

management.

Management(Agent)

Investor(Principal)

Signaling

Company management makes decisions about dividend policies using internal

forecasts; a stable and rising dividend can signal superior future return potential.

Dividend Stocks by Quintile vs. S&P 500Growth of $1,000*

Reliability

Earnings & cash flows can be manipulated while dividends are a more certain measure

of the return-generating capacity of a business model; academic research has

found that dividends provide information about the quality of earnings1.


Q3 202014

In low interest rate environments, investors substitute toward dividend-paying stocks, resulting in higher multiples for higher payout ratios.

Source: “What if the Market is Revaluing Dividends,” Fidelity Asset Management, March 2012

Multiples At Different Payout Ratios Multiples on Distributed Versus Undistributed Earnings


Q3 2020Source: Siegel, Jeremy, Future for Investors (2005), with updates through 2017

Each stock in the S&P 500 is ranked from lowest to highest by price to earnings ratio on December 31st of every yearand placed into “quintiles” (baskets of 100 stocks). The stocks in each quintile are weighted by their marketcapitalization. The price/earnings ratio is defined as each stock’s price as of December 31st of that year divided by itsnet income per share. Past performance does not guarantee future results.

Growth of $1000: Cumulative Returns by P/E Ratio 1957-2017

Why Value Matters

15

PHILOSOPHY

Q3 2020

40

50

60

70

80

90

100

110

120

16

Source: University of Michigan, FTSE Russell.*The Russell 3000 is a total market index, which assumes all cash distributions are reinvested. Peak is defined as highest index value beforea series of lower lows, while trough is defined as lowest index value before a series of higher highs. Shaded areas indicate US recessions.

At Altrius, we often view crisis as an opportunity and invest when others won’t, allowing us to capitalize on potential upside performance.

Why Value MattersPHILOSOPHY

Stock Returns During Periods of Uncertainty

May 1980:+32.0%

Jan. 2000:-4.5%

Mar. 2003:+38.1% Oct. 2005:

+16.5%

Jan 2004:+6.4%

Nov. 2008:+28.4%

Jan 2007:-2.2%

Oct. 1990:+33.9%

Mar. 1984:+19.6%

Aug. 2011:+20.0%

Sentiment cycle peak and subsequent 1-yr Russell 3000* return

Sentiment cycle trough and subsequent 1-yr Russell 3000 return

Jan 2015:-4.8%

Con

sum

er S

entim

ent I

ndex

Q3 202017

Contrary to CAPM efficient market claims, high risk is often not associated with high reward.

Empirical Returns by Volatility QuintileVa

lue

of $

1 In

vest

ed in

196

8

Source: Benchmarks as Limits to Arbitrage: Understanding the LowVolatility Anomaly; Financial Analyst Journal Volume 67, 2011

The Value of Risk-Adjusted ReturnsPHILOSOPHY

Q3 202018

A process designed to outperform driven by total return:

GLOBAL MACRO TOP DOWN PERSPECTIVE

DRIVES INITIAL UNIVERSE

Top down strategy employed to identify the most compelling geographic, industry

and/or sector set:

National GDP Growth

Demographics- Where is the Growth?

Durable Businesses Exploiting Growth

Demand Changes: What’s growing, moving, slowing?

Bottom up process seeks to identify companies selling below their

intrinsic value:

Seek high-yielding, durable businesses

Screen P/E ratio, the ‘real’ earnings of a company

Seeking companies generally selling for

Q3 202019

CLASSIC VALUE30-50%

PERSISTENT EARNERS30-50%

Well-established companies with dependable revenue growth, reliable earnings and healthy

dividend appreciation, priced below their historical valuations.

Persistent Earners: Nestlé SA, Unilever NV, Diageo PLC, Danone SA, Taiwan Semiconductor

Financially sound companies selling at economical valuations relative to their earnings power which demonstrate a commitment to sound, above average

dividends over the long term.Classic Value: GlaxoSmithKline PLC, AstraZeneca

PLC, British American Tobacco PLC

Companies that sell at significant discounts to their intrinsic value due to market

inefficiencies driven by irrational sell-offs.Distressed/Contrarian: Bayer AG

DISTRESSED/CONTRARIAN0-15%

Further fundamental analysis is designed to determine which companies are increasing top line revenue growth, earnings and dividend payments. We target a portfolio of 20-50 companies that

fall into three value categories: Distressed/Contrarian, Classic Value and Persistent Earners.

Altrius Investment ProcessPROCESS

Chart1

Contrarian Distressed

Classic Value

Persistent Earners

Security Allocation

20

40

40

Sheet1

Security Allocation

Contrarian Distressed20

Classic Value40

Persistent Earners40


Q3 202020

What Smart Beta Means to Us

Since 1997, we have employed a “smart beta” active management process characterized by three aspects of portfolio management which we believe lead to potentially superior risk-adjusted returns.

We craft our portfolios based on three “factors” – macro outlook, value, and dividends– which we believe are crucial in generating total return. We don’t attempt to follow anindex, but rather tactically position ourselves where we see opportunity.

Portfolio Selection

Equal Weighting

Contrarian Rebalancing

Our portfolio holdings are weighted equally in order to diversify adequately andprevent a small number of securities from driving portfolio performance.

We employ a process of contrarian rebalancing on a conditional basis to bring holdingsback to equal weights. When deemed necessary, we trim positions that have grown invalue and use proceeds to purchase those which have declined without a deteriorationof fundamental growth potential.

PROCESS

Q3 202021

At Altrius we employ a structured risk management perspective throughout oursecurity selection, monitoring, and sell process. By maintaining a data driven, factsoriented investment management process we avoid the bias that can often resultin poor risk management decisions.

As an added risk management component to our investment process, we create worstcase and best case scenarios for evaluating market opportunities and risk.

We do not hesitate to sell securities that we believe are ‘at risk’ based onfundamental factors; we remain agile and focused on our portfolio holdings at alltimes, prepared to sell securities that are not performing or for which we believe wehave identified better candidates to maximize portfolio return and to minimizeportfolio risk.

Companies that cut their dividend are almost always an automatic sell.

Valuations that exceed 20x earnings become too pricey and typically result in a sell.

Risk Management & Sell DisciplinePROCESS

Q3 2020

Portfolio Construction Guidelines

22

Benchmarks MSCI EAFE Value Index

Number of Holdings 20-50

Average Market Cap $30 - $70B

Minimum Market Cap $2B

Max Position Size 5%

Turnover 15 - 30%

PORTFOLIO ANALYTICS

Q3 202023

A History of Above Average Dividends

Altrius has consistently delivered a higher dividend yield than the MSCI EAFE index since inception.

International ADR Dividend Income vs. MSCI EAFE Dividend Yield

Source: Morningstar

PORTFOLIO ANALYTICS

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

Int'l ADR MSCI EAFE

Q3 202024

Geographic Diversification

International ADR Dividend Income Geographic Exposure

PORTFOLIO ANALYTICS

As of 09.30.2020

Europe Developed, 49%

United Kingdom, 29%

North America, 16%

Asia Developed, 7%

Japan, 0%

Australasia, 0%

Africa/Middle East, 0%

Latin America, 0%

Europe Emerging, 0%

Asia Emerging, 0%

Q3 202025

Geographic Diversification

International ADR Dividend Income Geographic Exposure vs. MSCI EAFE*

*Annual geographic exposure data is reported as of 12.31 of the respectiveyear since 01.01.2013. 2020 data is reported as of 09.30.2020.

PORTFOLIO ANALYTICS

-30%

-20%

-10%

0%

10%

20%

30%

Europe Emerging, 0%

North America, +15%

Asia Emerging, 0%

Europe Developed, +1%

Asia Developed, +2%

Latin America, 0%

Africa/Middle East, -1%

Australasia, -7%

United Kingdom, +15%

Japan, -26%

Q3 202026

Revenue by Geography

Global Revenue Generation

As of 09.30.2020Source: Morningstar

PORTFOLIO ANALYTICS

United States, 36.5%

Asia - Emerging, 16.9%

Eurozone, 13.6%

Latin America, 7.7%Canada, 4.9%

Japan, 4.3%

United Kingdom, 3.9%

Europe - Emerging, 2.9%

Asia - Developed, 2.7%

Middle East, 2.4%

Australasia, 1.9%

Europe - ex Euro, 1.6%Africa, 0.7%

Other, 16.1%

Q3 202027

Sector Diversification

International ADR Dividend Income Sector Allocation*

*Sector allocation data is reported quarterly since 01.31.2013.

PORTFOLIO ANALYTICS

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%Real Estate

Consumer Cyclical

Industrials

Financial Services

Technology

Communication Services

Utilities

Basic Materials

Consumer Defensive

Healthcare

Energy

Q3 202028

Sector Diversification

International ADR Dividend Income Sector Allocation vs. MSCI EAFE*

PORTFOLIO ANALYTICS

*Annual sector allocation data is reported as of 12.31 of the respective yearsince 01.01.2013. 2020 data is reported as of 09.30.2020

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Consumer Defensive, +18%

Technology, -3%

Basic Materials, -2%

Communication Services, -6%

Real Estate, -3%

Healthcare, +14%

Industrials, +1%

Utilities, -4%

Consumer Cyclical, -6%

Financial Services, -6%

Energy, -3%

Q3 202029

Benchmark MSCI EAFE Value Index

Trailing P/E 18.40

Dividend Yield (TTM) 4.01%

Price/Book 2.81

Standard Deviation (sinceinception*) 15.08

Alpha (annualized, since inception) 0.96

Beta (since inception) 0.86

Sharpe Ratio (annualized, since inception) 0.29

As of 09.30.2020

Portfolio Analytics

Since inception statistics for the timeperiod: 10.01.2010 to 09.30.2020

PORTFOLIO ANALYTICS

Q3 202030

Altrius Value Proposition

Ann

ual Y

ield

PERFORMANCE

Port

folio

Val

ue

International ADR Dividend Income Growth of $1,000,000 and Dividend Yield*

*Portfolio Growth of $1,000,000 assumes reinvestment of all dividends sinceinception. All data represented is gross of fees.**Trailing Twelve Months (TTM) Portfolio Annual Yield of 4.01% for theperiod 09/30/2019 - 09/30/2020.

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000

$2,000,000

Growth of $1,000,000 Portfolio Annual Yield

**European Crisis

COVID-19

Oil Sell-off

Q3 202031

Altrius Value Proposition

*Portfolio Growth of $1,000,000 and Annual Income assumes reinvestmentof all dividends since inception. All data represented is gross of fees.

PERFORMANCE

Port

folio

Val

ue

Ann

ual I

ncom

e

International ADR Dividend Income Growth of $1,000,000 and Dividend Income*

$-

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000

$2,000,000

Growth of $1,000,000 Portfolio Annual Income

European Crisis

COVID-19

Oil Sell-off

Q3 202032

Portfolio Analytics:

-20%

-15%

-10%

-5%

0%

5%

10%

YTD09.30.2020

1 Year 3 Year 5 Year 10 Year SinceInception06.01.2010

Altrius (Net)

Altrius (Gross)

MSCI EAFE Value NR

PERIOD YTD0930.2020 1 YEAR 3 YEAR 5 YEAR 10 YEARSince

Inception

Altrius (Net) (12.61) (5.19) (3.15) 2.63 1.62 2.82

Altrius (Gross) (11.94) (4.21) (2.09) 3.77 2.76 3.96

MSCI EAFE Value NR (18.31) (11.93) (5.86) 1.14 2.10 3.33

International ADR Dividend Income

As of 09.30.2020

PERFORMANCE

Chart1

YTD 09.30.2020YTD 09.30.2020YTD 09.30.2020

1 Year1 Year1 Year

3 Year3 Year3 Year

5 Year5 Year5 Year

10 Year10 Year10 Year

Since Inception 06.01.2010Since Inception 06.01.2010Since Inception 06.01.2010

Altrius (Net)

Altrius (Gross)

MSCI EAFE Value NR

-0.1261

-0.1194

-0.1831

-0.0519

-0.0421

-0.1193

-0.0315

-0.0209

-0.0586

0.0263

0.0377

0.0114

0.0162

0.0276

0.021

0.0282

0.0396

0.0333

Sheet1

Altrius (Net)Altrius (Gross)MSCI EAFE Value NR

YTD 09.30.2020-12.61%-11.94%-18.31%

1 Year-5.19%-4.21%-11.93%

3 Year-3.15%-2.09%-5.86%

5 Year2.63%3.77%1.14%

10 Year1.62%2.76%2.10%

Since Inception 06.01.20102.82%3.96%3.33%


Q3 202033

Altrius International ADR Dividend Income Composite PerformanceMay 31, 2010 – December 31, 2019

YearGross

Return %

Net Return

%

BenchmarkReturn

%

Composite 3-Yr

St Dev %

Benchmark3Yr

St Dev %

# of Portfolios

Composite Dispersion

%

TotalComposite

Assets

Percent ofFirm

Assets

2010 23.80 23.08 19.67 N/A N/A 103 N/A 7,992,038 9.69

2011 (2.14) (3.27) (12.17) N/A N/A 101 0.62 10,051,518 8.08

2012 11.44 10.19 17.69 N/A N/A 105 0.58 9,923,562 7.35

2013 16.46 15.20 22.95 14.63 17.45 117 0.44 15,508,454 8.89

2014 (9.67) (10.68) (5.39) 13.01 14.32 128 0.52 22,637,241 11.96

2015 (11.77) (12.73) (5.68) 13.96 13.59 114 0.62 18,366,384 10.00

2016 7.88 6.67 5.02 13.97 13.49 133 0.81 27,156,259 10.16

2017 23.49 22.14 21.44 13.40 12.83 142 0.61 38,977,196 11.43

2018 (15.89) (14.94) (14.77) 12.36 12.19 148 0.34 34,693,791 10.45

2019 19.44 18.16 16.09 12.85 11.75 146 0.47 46,610,523 13.70

Composite OverviewPERFORMANCE

Q3 202034

ACCOUNT FORMAT SEPARATELY MANAGED ACCOUNT

INSTITUTIONAL ACCOUNT MINIMUM $1,000,000

MANAGEMENT FEE < $25M 55 BP

MANAGEMENT FEE > $25M 50 BP

Management Fee StructureFEE STRUCTURE

Q3 202035

Performance ReportingAltrius Capital Management, Inc. (Altrius) claims compliance with the Global Investment Performance Standards (GIPS®) and has preparedand presented this report in compliance with the GIPS standards. Altrius has been independently verified for the periods January 31, 2001 –December 31, 2019 by ACA Verification Services. The verification reports are available upon request. A firm that claims compliance with theGIPS standards must establish policies and procedure for complying with all the applicable requirements of the GIPS standards. Verificationprovides assurance on whether the firm’s policies and procedures related to composite and pooled fund maintenance, as well as thecalculation, presentation, and distribution of performance, have been designed in compliance with the GIPS standards and have beenimplemented on a firm-wide basis. Verification does not provide assurance on the accuracy of any specific performance report.

The Firm is defined as Altrius Capital Management, Inc. (Altrius), a registered investment advisor with the Securities and ExchangeCommission. Altrius was founded in 1997 and manages equity, fixed income and balanced portfolios for high net worth individuals andfamilies.

Composite CharacteristicsThe International ADR Dividend Income strategy is a subaccount from the Altrius Global Income Composite. The composite andsubaccount were created in December 2010 with a performance inception date of May 31, 2010. The subaccount strategy seeks long termcapital appreciation and income by investing at least 80% of its assets in a diversified portfolio of income-producing equity securities payinghigher than average dividends. 30-50 International ADR positions are chosen from a universe of stocks with market capitalizations generallygreater than $10 billion.

Accounts are included on the last day of the month in which the account meets the composite definition. Accounts no longer undermanagement are withdrawn from the composite on the first day of the month in which they are no longer under management. Closedaccount data is included in the composite as mandated by the standards in order to eliminate a survivorship bias.

DisclosureDISCLOSURE

Q3 2020

BenchmarkThe benchmark is the MSCI EAFE Value NR. Effective 10/01/2017, the benchmark was changed from the MSCI EAFE NR Index to

the MSCI EAFE Value NR Index. The volatility of the indices may be materially different from that of the performance composite. Inaddition, the composite’s holdings may differ significantly from the securities that comprise the indices. The indices have not been selected torepresent appropriate benchmarks to compare the composite’s performance, but rather are disclosed to allow for comparison of thecomposite’s performance to those of well-known and widely recognized indices.

Economic factors, market conditions, and investment strategies will affect the performance of any portfolio, and there are no assurancesthat it will match or outperform any particular benchmark.

Performance CalculationsValuations and returns are computed and stated in U.S. dollars. Results reflect the reinvestment of dividends and other earnings.Gross of fees return is net of transaction costs and gross of management and custodian fees. Net of fees returns are calculated using

actual management fees that were paid and are presented before custodial fees and but after management fees and all trading expenses.Returns can be net or gross of withholding taxes, depending on how taxes are recorded at the custodian. Some accounts pay fees outside oftheir accounts; thus, we enter a non-cash transaction in the performance system such that we can calculate a net of fees return. Prior to01/01/2010, cash was allocated to carve-out segments on a pro-rata basis based on beginning of period market values. Beginning01/01/2010, carve-out segments are managed separately with their own cash balance. Carve-out accounts represent 100% of composite assetsfor periods prior to 01/01/2010.

The standard management fee for the Altrius International ADR Dividend strategy is 1.40% per annum on the first $500,000 USD, 1.00%per annum on the next $500,000 and 0.80% per annum thereafter. Additional information regarding Altrius Capital Management fees areincluded in its Part II Form ADV.

Internal dispersion is calculated using the asset-weighted standard deviation of all accounts included in the composite for the entire year; itis not presented for periods less than one year or when there were five or fewer portfolios in the composite for the entire year. The three-yearannualized standard deviation measures the variability of the composite and the benchmark (MSCI EAFE Value NR) returns over thepreceding 36-month period.

There are no non-fee paying accounts in our composites. When a security is purchased or sold, the principal amounts tied to thetransaction are net of trading costs; therefore the calculation and market values represent amounts net of trading costs. Dispersion iscalculated using asset-weighted standard deviation, gross of fees. Policies for valuing portfolios, calculating performance, and preparingcompliant presentations are available upon request. A complete list and description of firm composites is available upon request.

36


Q3 2020

Past performance does not guarantee future results. The information provided in this material should not be considered an offer nor arecommendation to buy, sell or hold any particular security.

The Altrius International ADR Dividend Income strategy is not sponsored, endorsed, sold or promoted by Morningstar, Inc. or any of itsaffiliates (all such entities, collectively, “Morningstar Entities”). The Morningstar Entities make no representation or warranty, express orimplied, to the owners of the Altrius International ADR Dividend Income strategy or any member of the public regarding the advisability ofinvesting in an equity strategy generally or in the Altrius International ADR Dividend Income strategy in particular or the ability of the (MSCIEAFE Value NR) to track general equity market performance.

THE MORNINGSTAR ENTITIES DO NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THEALTRIUS INTERNATIONAL ADR DIVIDEND INCOME STRATEGY OR ANY DATA INCLUDED THEREIN ANDMORNINGSTAR ENTITIES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN.

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Toll Free: 855-ALTRIUSEmail Address: [email protected]

Altrius Capital Management51 JFK Parkway, First Floor WestShort Hills, NJ 07078Phone: 201-399-0580

Altrius Capital Management4819 Emperor Blvd., Suite 400Durham, NC 27703Phone: 919-746-7977

Altrius Capital Management1323 Commerce DriveNew Bern, NC 28562Phone: 252-638-7598Fax: 252-635-6739

Worldwide:

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mailto:[email protected]

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international adr dividend income strategy...altrius maintains a +17 year track record in the...

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