TD Dividend Growth Fund · 2019. 9. 2. · June 30, 2019 Semi-Annual Financial Report n TD Dividend...

TD Dividend Growth Fund

(08/19)532046

for the period ended June 30, 2019

TD Mutual Funds

Semi-Annual Financial Report

June 30, 2019 Semi-Annual Financial Report

nManagement’s Responsibility for Financial Reporting The accompanying unaudited interim financial report has been prepared by TD Asset Management Inc. (“TDAM”), as manager of the TD Mutual Fund Trusts, TD Managed Assets Program Portfolios and TD Managed ETF Portfolios (collectively the “Funds” and individually the “Fund”) and approved by TDAM’s board of directors. The manager is responsible for the integrity, objectivity and reliability of the data presented. This responsibility includes selecting appropriate accounting principles and making judgments and estimates consistent with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”), including International Accounting Standard (“IAS”) 34, “Interim Financial Reporting”. The manager is also responsible for the development of internal controls over the financial reporting process, which are designed to provide reasonable assurance that relevant and reliable financial informa tion is produced, and the safeguarding of all assets of the Funds.

The board of directors of TDAM, is responsible for reviewing and approv-ing the financial statements and overseeing management’s performance of its financial reporting responsibilities.

On behalf of TDAM, manager of the Funds.

Bruce Cooper Salma Salman Director and Director and Chief Executive Officer Chief Financial Officer August 14, 2019 August 14, 2019

nNotice to Unitholders The Auditor of the Funds has not reviewed the TD Mutual Fund Trusts in this Financial Report

TDAM, as manager of the Funds, appoints an independent auditor to audit the Funds’ annual financial statements. Applicable securities laws require that if an auditor has not reviewed the Funds’ interim financial report, this must be disclosed in an accompanying notice.

1


nTD Dividend Growth Fund Statements of Financial Position (in 000s except per unit amounts) as at June 30, 2019 and December 31, 2018 (Unaudited)

June 30, December 31, 2019 2018

Assets Current Assets Investments $ 7,057,282 $ 6,042,139 Derivative Assets (Note 3) 3,830 0 Cash 92,543 98,090 Interest and Dividends Receivables 23,935 22,243 Subscriptions Receivable 3,979 5,013

7,181,569 6,167,485

Liabilities Current Liabilities Derivative Liabilities (Note 3) 0 8,156 Accrued Liabilities 245 256 Redemptions Payable 4,852 5,619 Distributions Payable 3,936 0

9,033 14,031

Net Assets Attributable to Holders of Redeemable Units $ 7,172,536 $ 6,153,454

Net Assets Attributable to Holders of Redeemable Units – Per Series (Note 5) Investor Series $ 2,099,111 $ 2,232,972 Institutional Series $ 49,603 $ 45,172 Premium Series $ 192,386 $ 191,413 Advisor Series $ 677,641 $ 653,461 F-Series $ 515,958 $ 377,414 Premium F-Series $ 59,304 $ 54,823 H8 Series $ 18,406 $ 18,110 FT5 Series $ 2,389 $ 837 FT8 Series $ 30,085 $ 22,810 T8 Series $ 138,159 $ 136,402 D-Series $ 467,779 $ 79,913 O-Series $ 2,921,715 $ 2,340,127

$ 7,172,536 $ 6,153,454

Net Assets Attributable to Holders of Redeemable Units – Per Series Unit

Investor Series $ 86.72 $ 76.98

Institutional Series $ 34.55 $ 30.66

Premium Series $ 13.43 $ 11.92

Advisor Series $ 31.50 $ 27.95

F-Series $ 32.76 $ 29.05

Premium F-Series $ 13.52 $ 12.00

H8 Series $ 10.16 $ 9.28

FT5 Series $ 14.50 $ 12.99

FT8 Series $ 10.89 $ 9.89

T8 Series $ 10.06 $ 9.18

D-Series $ 12.44 $ 10.99

O-Series $ 18.92 $ 16.78

The accompanying notes are an integral part of the interim financial report.

2


nTD Dividend Growth Fund Statements of Comprehensive Income (in 000s except per unit amounts) for the periods ended June 30, 2019 and 2018 (Unaudited)

2019 2018

Income Net Gain (Loss) on Investments and Derivatives

Dividend Income $ 130,621 $ 127,967 Interest for Distribution Purposes 1,464 687 Net Realized Gain (Loss) (33,869) 153,364 Net Change in Unrealized Appreciation/

Depreciation 804,762 (274,566)

Net Gain (Loss) on Investments and Derivatives 902,978 7,452 Foreign Exchange Gain (Loss) on Cash (619) 199 Securities Lending Income 137 269

Total Income (Net) 902,496 7,920

Expenses (Note 6) Management Fees 36,322 39,224 Administration Fees 1,570 1,730 Audit Fees 0 1 Transaction Costs 271 333

Total Expenses before Waivers 38,163 41,288 Less: Waived Expenses (14) (15)

Total Expenses (Net) 38,149 41,273

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units before Tax 864,347 (33,353)

Tax Reclaims (Withholding Taxes) (505) (402)

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units $ 863,842 $ (33,755)

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units – Per Series Investor Series $ 299,510 $ (28,071) Institutional Series $ 6,478 $ (163) Premium Series $ 25,432 $ (3,244) Advisor Series $ 87,814 $ (9,029) F-Series $ 55,437 $ 1,352 Premium F-Series $ 7,702 $ (403) H8 Series $ 2,449 $ (223) FT5 Series $ 135 N/A FT8 Series $ 3,226 $ 94 T8 Series $ 18,168 $ (1,981) D-Series $ 13,308 $ (177) O-Series $ 344,183 $ 8,090

$ 863,842 $ (33,755)

2019 2018

Weighted Average Units Outstanding for the Period – Per Series

Investor Series 28,230 31,175

Institutional Series 1,454 1,554

Premium Series 15,158 19,187

Advisor Series 22,742 25,414

F-Series 14,526 8,547

Premium F-Series 4,442 4,956

H8 Series 1,900 2,034

FT5 Series 110 N/A

FT8 Series 2,475 1,374

T8 Series 14,247 15,690

D-Series 10,386 4,706

O-Series 140,991 161,291

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units – Per Series Unit

Investor Series $ 10.61 $ (0.90)

Institutional Series $ 4.46 $ (0.11)

Premium Series $ 1.68 $ (0.17)

Advisor Series $ 3.86 $ (0.36)

F-Series $ 3.82 $ 0.16

Premium F-Series $ 1.73 $ (0.08)

H8 Series $ 1.29 $ (0.11)

FT5 Series $ 1.22 N/A

FT8 Series $ 1.30 $ 0.07

T8 Series $ 1.28 $ (0.13)

D-Series $ 1.28 $ (0.04)

O-Series $ 2.44 $ 0.05


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Statements of Changes in Net Assets Attributable to Holders of Redeemable Units (in 000s) for the periods ended June 30, 2019 and 2018 (Unaudited)

Investor Series Institutional Series Premium Series

2019 2018 2019 2018 2019 2018

Net Assets Attributable to Holders of Redeemable Units at Beginning of the Period $ 2,232,972 $ 2,745,676 $ 45,172 $ 55,941 $ 191,413 $ 271,708

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 299,510 (28,071) 6,478 (163) 25,432 (3,244)

Distributions to Holders of Redeemable Units (17,598) (15,254) (755) (726) (1,523) (1,521)

Redeemable Unit Transactions Proceeds from Redeemable Units Issued 149,902 178,530 1,668 1,031 868 2,395 Reinvestments of Distributions 17,334 15,000 10 14 1,462 1,468 Redemption of Redeemable Units (583,009) (276,244) (2,970) (4,031) (25,266) (32,292)

Net Increase (Decrease) from Redeemable Unit Transactions (415,773) (82,714) (1,292) (2,986) (22,936) (28,429)

Net Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units (133,861) (126,039) 4,431 (3,875) 973 (33,194)

Net Assets Attributable to Holders of Redeemable Units at End of the Period $ 2,099,111 $ 2,619,637 $ 49,603 $ 52,066 $ 192,386 $ 238,514

Redeemable Unit Transactions Redeemable Units Outstanding,

Beginning of the Period 29,008 31,495 1,473 1,610 16,062 20,126 Redeemable Units Issued 1,750 2,112 49 31 65 184 Redeemable Units Issued on Reinvestments 202 178 0 0 110 113 Redeemable Units Redeemed (6,754) (3,273) (86) (118) (1,911) (2,480)

Redeemable Units Outstanding, End of the Period 24,206 30,512 1,436 1,523 14,326 17,943

Advisor Series F-Series Premium F-Series

2019 2018 2019 2018 2019 2018

Net Assets Attributable to Holders of Redeemable Units at Beginning of the Period $ 653,461 $ 833,289 $ 377,414 $ 243,957 $ 54,823 $ 69,949

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 87,814 (9,029) 55,437 1,352 7,702 (403)

Distributions to Holders of Redeemable Units (5,127) (4,505) (6,140) (3,202) (801) (792)

Redeemable Unit Transactions Proceeds from Redeemable Units Issued 38,532 47,717 129,042 110,400 0 0 Reinvestments of Distributions 4,890 4,294 4,423 2,296 512 510 Redemption of Redeemable Units (101,929) (104,052) (44,218) (23,002) (2,932) (5,414)

Net Increase (Decrease) from Redeemable Unit Transactions (58,507) (52,041) 89,247 89,694 (2,420) (4,904)

Net Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 24,180 (65,575) 138,544 87,844 4,481 (6,099)

Net Assets Attributable to Holders of Redeemable Units at End of the Period $ 677,641 $ 767,714 $ 515,958 $ 331,801 $ 59,304 $ 63,850


Beginning of the Period 23,378 26,322 12,990 7,427 4,567 5,143 Redeemable Units Issued 1,244 1,558 3,984 3,474 0 0 Redeemable Units Issued on Reinvestments 156 140 136 72 38 39 Redeemable Units Redeemed (3,266) (3,395) (1,361) (723) (220) (412)

Redeemable Units Outstanding, End of the Period 21,512 24,625 15,749 10,250 4,385 4,770

nTD Dividend Growth Fund


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H8 Series FT5 Series FT8 Series

2019 2018 2019 2018 2019 2018

Net Assets Attributable to Holders of Redeemable Units at Beginning of the Period $ 18,110 $ 23,078 $ 837 N/A $ 22,810 $ 13,863

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 2,449 (223) 135 N/A 3,226 94

Distributions to Holders of Redeemable Units (701) (921) (39) N/A (996) (673)

Redeemable Unit Transactions Proceeds from Redeemable Units Issued 1,766 2,122 1,580 N/A 7,834 6,352 Reinvestments of Distributions 373 449 5 N/A 241 222 Redemption of Redeemable Units (3,591) (2,332) (129) N/A (3,030) (822)

Net Increase (Decrease) from Redeemable Unit Transactions (1,452) 239 1,456 N/A 5,045 5,752

Net Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 296 (905) 1,552 N/A 7,275 5,173

Net Assets Attributable to Holders of Redeemable Units at End of the Period $ 18,406 $ 22,173 $ 2,389 N/A $ 30,085 $ 19,036


Beginning of the Period 1,951 2,038 64 N/A 2,307 1,163 Redeemable Units Issued 173 197 109 N/A 716 561 Redeemable Units Issued on Reinvestments 37 42 1 N/A 22 20 Redeemable Units Redeemed (350) (215) (9) N/A (282) (72)

Redeemable Units Outstanding, End of the Period 1,811 2,062 165 N/A 2,763 1,672

T8 Series D-Series

2019 2018 2019 2018

Net Assets Attributable to Holders of Redeemable Units at Beginning of the Period $ 136,402 $ 177,546 $ 79,913 $ 54,624

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 18,168 (1,981) 13,308 (177)

Distributions to Holders of Redeemable Units (5,197) (7,016) (1,354) (574)

Redeemable Unit Transactions Proceeds from Redeemable Units Issued 12,941 9,120 384,094 13,166 Reinvestments of Distributions 877 994 1,286 541 Redemption of Redeemable Units (25,032) (13,831) (9,468) (8,072)

Net Increase (Decrease) from Redeemable Unit Transactions (11,214) (3,717) 375,912 5,635

Net Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 1,757 (12,714) 387,866 4,884

Net Assets Attributable to Holders of Redeemable Units at End of the Period $ 138,159 $ 164,832 $ 467,779 $ 59,508


Beginning of the Period 14,852 15,841 7,271 4,396 Redeemable Units Issued 1,320 849 30,988 1,091 Redeemable Units Issued on Reinvestments 87 94 104 45 Redeemable Units Redeemed (2,520) (1,298) (766) (670)

Redeemable Units Outstanding, End of the Period 13,739 15,486 37,597 4,862



5



O-Series TOTAL

2019 2018 2019 2018

Net Assets Attributable to Holders of Redeemable Units at Beginning of the Period $ 2,340,127 $ 3,031,717 $ 6,153,454 $ 7,521,348

Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 344,183 8,090 863,842 (33,755)

Distributions to Holders of Redeemable Units (46,800) (49,163) (87,031) (84,347)

Redeemable Unit Transactions Proceeds from Redeemable Units Issued 335,730 268,357 1,063,957 639,190 Reinvestments of Distributions 45,365 47,577 76,778 73,365 Redemption of Redeemable Units (96,890) (477,709) (898,464) (947,801)

Net Increase (Decrease) from Redeemable Unit Transactions 284,205 (161,775) 242,271 (235,246)

Net Increase (Decrease) in Net Assets Attributable to Holders of Redeemable Units 581,588 (202,848) 1,019,082 (353,348)

Net Assets Attributable to Holders of Redeemable Units at End of the Period $ 2,921,715 $ 2,828,869 $ 7,172,536 $ 7,168,000


Beginning of the Period 139,419 159,300 Redeemable Units Issued 17,785 14,698 Redeemable Units Issued on Reinvestments 2,419 2,596 Redeemable Units Redeemed (5,211) (25,508)

Redeemable Units Outstanding, End of the Period 154,412 151,086



6


nTD Dividend Growth Fund Statements of Cash Flows (in 000s) for the periods ended June 30, 2019 and 2018 (Unaudited)

2019 2018

Cash Flows from (used in) Operating Activities Increase (Decrease) in Net Assets Attributable

to Holders of Redeemable Units $ 863,842 $ (33,755) Adjustment For:

Unrealized Foreign Exchange (Gain) Loss on Cash (7) 0 Net Realized (Gain) Loss 33,869 (153,364) Net Change in Unrealized Appreciation/

Depreciation (804,762) 274,566 Purchase of Investments and Derivatives (330,161) (126,285) Proceeds from Sale, Paydown and Maturity

of Investments and Derivatives 73,942 397,316 (Increase) Decrease in Interest and

Dividends Receivables (1,709) (668) Increase (Decrease) in Accrued Liabilities (11) (15)

Net Cash from (used in) Operating Activities (164,997) 357,795

Cash Flows from (used in) Financing Activities Distributions Paid to Holders of Redeemable Units,

Net of Reinvested Distributions (6,317) (6,898) Proceeds from Issuances of Redeemable Units 598,429 526,847 Amounts Paid on Redemption of Redeemable Units (432,669) (835,904)

Net Cash from (used in) Financing Activities 159,443 (315,955)

Unrealized Foreign Exchange Gain (Loss) on Cash 7 0 Net Increase (Decrease) in Cash (5,554) 41,840 Cash (Bank Overdraft) at Beginning of the Period 98,090 34,367

Cash (Bank Overdraft) at End of the Period $ 92,543 $ 76,207

Interest for Distribution Purposes Received*, Net of Withholding Taxes $ 1,464 $ 687

Dividends Received*, Net of Withholding Taxes $ 128,407 $ 126,897

* Included as part of Cash Flows from (used in) Operating Activities.


7


Canadian Equities – 94.6%

ENERGY – 17.7%

1,103,600 ARC Resources Ltd. $ 23,103 $ 7,074 2,125,200 Canadian Natural Resources Limited 77,090 75,041 8,359,200 Cenovus Energy Inc. 155,357 96,549 343,900 Crescent Point Energy Corp. 5,578 1,489 8,607,654 Enbridge Inc. 295,152 407,142 1,663,500 Encana Corporation 46,163 11,179 1,659,439 Husky Energy Inc. 32,293 20,593 151,700 Imperial Oil Limited 5,634 5,501 510,500 Inter Pipeline Ltd. 13,715 10,399 274,600 Kinder Morgan Canada Limited 4,581 3,204 1,446,153 Pembina Pipeline Corporation 48,392 70,500 986,476 PrairieSky Royalty Limited 30,469 18,151 6,921,878 Suncor Energy Inc. 297,465 282,759 3,995,823 TC Energy Corporation 151,809 259,409

1,186,801 1,268,990

MATERIALS – 1.2%

1,821,369 Barrick Gold Corporation 64,268 37,648 188,139 Nutrien Ltd. 13,012 13,179 1,161,600 Teck Resources Limited, Class B 38,017 35,103

115,297 85,930

INDUSTRIALS – 9.3%

3,625,800 Canadian National Railway Company 139,702 439,447 594,800 Canadian Pacific Railway Limited 45,263 183,454 561,481 Thomson Reuters Corporation 22,145 47,434

207,110 670,335

CONSUMER DISCRETIONARY – 3.6%

1,575,400 Dollarama Inc. 12,929 72,579 2,003,800 Magna International Inc. 53,516 130,568 605,507 Restaurant Brands International Inc. 26,736 55,143

93,181 258,290

CONSUMER STAPLES – 2.4%

1,007,500 Alimentation Couche-Tard Inc., Class B SV 60,664 83,028 163,895 George Weston Limited 11,873 16,286 496,828 Loblaw Companies Limited 19,074 33,312 757,500 METRO Inc. 13,352 37,224 135,400 The North West Company Inc. 3,022 4,047

107,985 173,897

FINANCIALS – 47.7%

4,647,800 Bank of Montreal 257,044 459,760 6,022,000 The Bank of Nova Scotia 258,470 423,588 2,485,750 Brookfield Asset Management Inc.,

Class A 58,530 155,732 4,196,700 Canadian Imperial Bank of Commerce 293,942 432,176 239,900 CI Financial Corp. 6,283 5,120 20,345 E-L Financial Corporation Limited 2,817 15,157 67,200 Fairfax Financial Holdings Limited 18,381 43,194 761,900 Intact Financial Corporation 25,868 92,205 9,042,400 Manulife Financial Corporation 224,734 215,209 1,711,600 National Bank of Canada 55,378 106,479 250,100 Onex Corporation 6,766 19,755 1,427,000 Power Corporation of Canada 43,013 40,256 6,235,700 Royal Bank of Canada 298,107 648,949 2,238,400 Sun Life Financial Inc. 84,544 121,388 8,409,400 The Toronto-Dominion Bank* 271,031 643,487

1,904,908 3,422,455

INFORMATION TECHNOLOGY – 0.0%

325,200 BlackBerry Limited 18,844 3,174

UTILITIES – 2.1%

449,247 AltaGas Ltd. 13,344 8,900 984,000 Canadian Utilities Limited, Class A 20,564 36,369 534,000 Capital Power Corporation 12,931 16,100 613,100 Emera Inc. 14,135 32,807 547,500 Fortis Inc. 14,492 28,311 1,237,090 Just Energy Group Inc. 9,071 6,965 327,300 Superior Plus Corp. 4,133 4,373 1,490,300 TransAlta Corporation 30,896 12,697

119,566 146,522

REAL ESTATE – 0.2%

711,855 First Capital Realty Inc. 10,183 15,561 4,000 FirstService Corporation 385 504

10,568 16,065

INCOME TRUSTS – 2.9%

679,563 Artis Real Estate Investment Trust 8,016 7,903 95,800 Boardwalk Real Estate Investment Trust 3,700 3,817 2,155,150 Brookfield Infrastructure Partners L.P. 16,311 120,969 516,876 Brookfield Renewable Partners L.P. 6,026 23,414 1,605,675 Chemtrade Logistics Income Fund 19,023 15,045 292,604 H&R Real Estate Investment Trust 5,623 6,683 702,400 RioCan Real Estate Investment Trust 12,824 18,256 262,300 SmartCentres Real Estate

Investment Trust 5,539 8,711

77,062 204,798

COMMUNICATION SERVICES – 7.5%

2,338,632 BCE Inc. 73,232 139,336 364,300 Cineplex Inc. 4,232 8,375 2,218,800 Rogers Communications Inc., Class B 78,703 155,538 1,806,200 Shaw Communications Inc., Class B NV 37,298 48,262 3,809,200 TELUS Corporation 103,273 184,403

296,738 535,914

Total Canadian Equities 4,138,060 6,786,370

$ $

nTD Dividend Growth Fund Schedule of Investment Portfolio (in 000s except number of Shares or Units/Par Value) as at June 30, 2019 (Unaudited)

No. of Shares or Units/ Par Value Description Cost Fair Value


$ $

8

U.S. Equities – 3.7%

MATERIALS – 0.3%

432,398 Newmont Goldcorp Corp. 18,796 21,715

INDUSTRIALS – 1.5%

2,249,509 General Electric Company 50,716 30,931 250,800 Honeywell International Inc. 17,309 57,342 151,583 Waste Connections Inc. 4,604 18,963

72,629 107,236

FINANCIALS – 1.5%

729,000 JPMorgan Chase & Co. 36,468 106,731

REAL ESTATE – 0.4%

1,424,031 Brookfield Property Partners L.P. 33,127 35,230

Total U.S. Equities 161,020 270,912

Transaction Costs (2,762)

TOTAL INVESTMENT PORTFOLIO – 98.3% $ 4,296,318 $ 7,057,282

FORWARD CONTRACTS (SCHEDULE 1) – 0.1% 3,830

TOTAL PORTFOLIO $ 7,061,112

Note: Percentages shown relate investments at fair value to Net Assets as at the period end.

* Related party to the Fund as an affiliated entity of TD Asset Management Inc.

$ $



TD Dividend Growth Fund

Schedule 1

Foreign Exchange Forward Contracts (in 000s except contract price and total number of contract(s)) Canadian Value Canadian Value Settlement Currency to be as at Currency to be as at Contract CAD Unrealized Date Delivered June 30, 2019 Received June 30, 2019 Price Appreciation

July 31, 2019 39,012 USD $ 51,048 52,193 CAD $ 52,193 1.33788 $ 1,145 July 31, 2019 37,209 USD 48,689 49,773 CAD 49,773 1.33768 1,084 July 31, 2019 35,151 USD 45,996 47,020 CAD 47,020 1.33767 1,024 July 31, 2019 12,781 USD 16,724 17,097 CAD 17,097 1.33770 373 September 30, 2019 8,962 USD 11,717 11,825 CAD 11,825 1.31945 108 September 30, 2019 8,965 USD 11,721 11,829 CAD 11,829 1.31939 108 September 30, 2019 8,382 USD 10,959 11,058 CAD 11,059 1.31937 100

$ 196,854 $ 200,796 $ 3,942

Canadian Value Canadian Value Settlement Currency to be as at Currency to be as at Contract CAD Unrealized Date Delivered June 30, 2019 Received June 30, 2019 Price Depreciation

July 31, 2019 4,211 CAD $ 4,211 3,132 USD $ 4,099 1.34440 $ (112)

TOTAL NUMBER OF CONTRACT(S): 8 CAD NET UNREALIZED APPRECIATION $ 3,830

9


Fund-Specific Notes to the Interim Financial Report (Unaudited)

The Fund (I) The Fund was incepted on August 11, 1987 and its operations commenced on September 4, 1987.

(II) TDAM is the manager, portfolio adviser and trustee of the Fund. TDIS is the principal distributor of the Investor Series units of the Fund.

(III) The presentation and functional currency of the Fund is the Canadian dollar.

(IV) The investment objective of the Fund is to seek to provide a high level of after-tax income and steady growth by investing primarily in high-quality, high-yield equity securities and other income-producing instruments of Canadian issuers. In seeking to achieve this objective, the Fund invests predominantly in large-capitalization common equities that have either an above-average yield or the prospect of an attractive low risk total return. Equity investments will tend to be concen trated in the financial services, pipeline, and utility sectors of the market, but will also include large capitalization special situations. The Fund may also hold trust securities, bonds, preferred shares and exchange-traded funds.

(V) Any related party holdings as at June 30, 2019 (December 31, 2018: 9.0%), are disclosed in the Schedule of Investment Portfolio.

(VI) As at June 30, 2019, TD and funds managed by TDAM held 38.0% (December 31, 2018: 35.2%) of the net assets of the Fund.

(VII) Effective March 28, 2017, the following change was made: • The Premium F-Series was closed to all purchases.

Effective July 26, 2018, TD Asset Management Inc. changed the names of certain series of the Fund as follows: • From H-Series to H8 Series • From T-Series to T8 Series • From S-Series to FT8 Series

FT5 Series was launched on August 16, 2018.

Management Fees and Administration Fees (%) (Note 6) for the periods ended June 30, 2019 and 2018 (exclusive of GST and HST)

Annual Rate

Management Administration Series Fees• Fees

Investor Series 1.75 0.08 Institutional Series 0.50 N/A Premium Series 1.70 0.08 Advisor Series 1.75 0.08 F-Series 0.80 N/A Premium F-Series* 0.75 N/A H8 Series 1.75 0.08 FT5 Series 0.80 N/A FT8 Series 0.80 N/A T8 Series 1.75 0.08 D-Series 1.00 0.08 O-Series 0.00 N/A

• Includes management fees paid by the Fund and the proportionate management fees, if any, of the Underlying Funds managed by TDAM held by the Fund. However, there is no duplication of management fees paid to TDAM or its affiliates if the Fund invests in Underlying Funds that are managed by TDAM.

* The management fee rate disclosed represents the maximum annual rate per the simplified prospectus dated July 28, 2016. The series is no longer being offered under the most recent simplified prospectus.

Brokerage Commissions and Soft Dollars (in 000s) (Notes 3 and 6) for the periods ended June 30, 2019 and 2018

2019 2018

Total Brokerage Commissions $ 271 $ 333

Commissions Paid to Related Parties 9 67

Soft Dollars 41 27

Tax Loss Carry Forwards (in 000s) (Note 7) as at December 31, 2018

Capital Losses $ 16,574

Non-Capital Losses (by year of expiry) None

Securities Lent (Note 3)

(I) SECURITIES LENDING INCOME

A reconciliation of the gross amount generated from the securities lending transactions to the securities lending income to the Fund for the periods ended June 30, 2019 and 2018 is as follows:

Percentage of Amount (in 000s) Total Amount (%)

2019 2018 2019 2018

Gross Securities Lending Income $ 171 $ 336 100.0 100.0

Agent Fees – The Bank of New York Mellon (34) (67) (20.0) (19.9)

Securities Lending Income to the Fund before Tax Reclaims (Withholding Taxes) 137 269 80.0 80.1

Tax Reclaims (Withholding Taxes) 0 0 0.0 0.0

Net Securities Lending Income $ 137 $ 269 80.0 80.1

(II) SECURITIES LENT AND COLLATERAL HELD (in 000s) The table below summarizes the aggregate securities lent and related collateral held by the Fund as at June 30, 2019 and December 31, 2018.

June 30, December 31, 2019 2018

Fair Value of Securities Lent $ 296,275 $ 283,054

Fair Value of Collateral Held 311,117 297,554

Collateral held is in the form of debt obligations of the Government of Canada and other countries, Canadian provincial and municipal governments or corporations and is not included in the Statements of Financial Position.

Financial Risk Management (Notes 3, 4 and 8) as at June 30, 2019 and December 31, 2018

(I) INTEREST RATE RISK

Not significant to the Fund.

(II) CURRENCY RISK

Not significant to the Fund after hedging activities.


10


(III) OTHER PRICE RISK

The table below summarizes the impact of other price risk to the Fund. As at June 30, 2019 and December 31, 2018, had the benchmark of the Fund increased or decreased by 5 percent, with all other variables held constant, the net assets of the Fund would have increased or decreased by approximately:

Impact on Impact on Net Assets (in 000s) Net Assets (%)

June 30, December 31, June 30, December 31, Benchmark 2019 2018 2019 2018

60% S&P/TSX Sector Indices* 40% S&P/TSX 60

Total Return Index $ 377,565 $ 323,254 5.3 5.3

* S&P/TSX Sector Indices (financials, real estate, utilities, communication services, industrials, consumer staples, consumer discretionary, and oil and gas storage & transportation sub industry)

In practice, the actual trading results may differ from the above estimated amounts and the differences could be material.

(IV) CREDIT RISK

Not significant to the Fund.

(V) FINANCIAL INSTRUMENTS BY THE LEVEL IN THE FAIR VALUE HIERARCHY (in 000s) The tables below illustrate the classification of the Fund’s financial instruments within the fair value hierarchy as at June 30, 2019 and December 31, 2018.

Level 1 Level 2 Level 3 Total

June 30, 2019 Equities $ 7,057,282 $ 0 $ 0 $ 7,057,282 Forward Contracts 0 3,830 0 3,830

$ 7,057,282 $ 3,830 $ 0 $ 7,061,112

Level 1 Level 2 Level 3 Total

December 31, 2018 Equities $ 6,042,139 $ 0 $ 0 $ 6,042,139 Forward Contracts 0 (8,156) 0 (8,156)

$ 6,042,139 $ (8,156) $ 0 $ 6,033,983

As at the end of the periods, transfers between Level 1 and Level 2 were not significant.

(VI) RECONCILIATION OF LEVEL 3 FAIR VALUE MEASUREMENTS (in 000s) Not significant or applicable to the Fund.

Investment Portfolio Concentration (%) (Note 8) As at June 30, 2019 and December 31, 2018, the Fund’s investment portfolio concentration can be summarized as follows:

June 30, December 31, 2019 2018

Canadian Equities Energy 17.7 17.6 Materials 1.2 1.5 Industrials 9.3 8.6 Consumer Discretionary 3.6 3.4 Consumer Staples 2.4 2.4 Financials 47.7 48.7 Information Technology 0.0 0.0 Utilities 2.1 2.0 Real Estate 0.2 0.2 Income Trusts 2.9 2.5 Communication Services 7.5 8.0 U.S. Equities Materials 0.3 0.0 Industrials 1.5 1.3 Financials 1.5 1.5 Real Estate 0.4 0.5 Forward Contracts 0.1 (0.1) Other Net Assets (Liabilities) 1.6 1.9

100.0 100.0

Interest in Unconsolidated Structured Entities (in 000s) (Note 3) as at June 30, 2019 and December 31, 2018 Not significant or applicable to the Fund.

Fund-Specific Notes to the Interim Financial ReportTD Dividend Growth Fund

Offsetting of Financial Assets and Liabilities (in 000s) (Note 3) The following table presents the recognized financial instruments that are offset, or subject to enforceable master netting arrangements, if certain conditions arise, or other similar agreements but that are not offset, and cash and financial instruments collateral received or pledged, as at June 30, 2019 and December 31, 2018 and shows in the Net Amount column what the impact would be in the Fund’s Statements of Financial Position if all set-off rights were exercised.

Amounts Net Amounts Related Amounts Not

Gross Amounts Set-Off in the Presented in Set-Off in the Statements

of Recognized Statements the Statements of Financial Position

Financial Assets of Financial of Financial Financial (Liabilities) Position Position Instruments Cash Net Amount

June 30, 2019 Derivative Assets $ 3,942 $ (112) $ 3,830 $ 0 $ 0 $ 3,830

Derivative Liabilities (112) 112 0 0 0 0

December 31, 2018 Derivative Assets $ 541 $ (541) $ 0 $ 0 $ 0 $ 0

Derivative Liabilities (8,697) 541 (8,156) 0 0 (8,156)

11

1. The Funds

The TD Mutual Fund Trusts and TD Managed Assets Program Portfolios (collectively, the “Funds” and individually, the “Fund”) are open-end mutual funds established under the laws of Ontario and governed by their respective Declarations of Trust or Trust Indenture, as amended from time to time.

TD Asset Management Inc. (“TDAM”) is the manager, portfolio adviser and trustee of the Funds. TDAM, TDAM USA Inc., TD Investment Services Inc. (“TDIS”), TD Waterhouse Canada Inc. (“TDWCI”) and Epoch Investment Partners, Inc. (“Epoch”) are wholly-owned subsidiaries of The Toronto-Dominion Bank (“TD”). TD Greystone Asset Management (“TD Greystone”) represents Greystone Managed Investments Inc., a wholly-owned subsidiary of Greystone Capital Management Inc. (“GCMI”). GCMI is a wholly-owned subsidiary of TD. The registered address of the Funds is P.O. Box 100, 66 Wellington Street West, TD Bank Tower, Toronto-Dominion Centre, Toronto, Ontario, M5K 1G8.

The financial year-end for the Funds is December 31. The Statements of Financial Position are presented as at June 30, 2019 and December 31, 2018, as applicable. The Statements of Comprehensive Income, Statements of Changes in Net Assets Attributable to Holders of Redeemable Units and Statements of Cash Flows are presented for the six-month periods ended June 30, 2019 and 2018, as applicable. Where a Fund or series of a Fund was established during either period, the information for that Fund or series is provided from the inception date, as disclosed in the Fund-Specific Notes to the Interim Financial Report (“Fund-Specific Notes”), to the applicable period end date and a comparative statement has only been presented for any period for which that Fund was in existence as at the reporting date.

These financial statements were authorized for issue by TDAM on August 14, 2019.

2. Basis of Presentation

These financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”), applicable to the preparation of interim financial reports, including International Accounting Standards (“IAS”) 34, “Interim Financial Reporting”. These financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets and financial liabilities (including derivative financial instruments) at fair value through profit or loss (“FVTPL”).

3. Summary of Significant Accounting Policies

Financial Instruments Financial instruments include financial assets and financial liabilities, such as investments, derivatives, cash, and other receivables and payables. Derivatives that are reflected in the Statements of Financial Position as Derivative Assets (Liabilities) include rights, warrants, forwards, options, futures and swap contracts, where applicable, and are financial contracts between two or more parties, and whose value is derived from the performance of an underlying asset or group of assets. Underlying assets include stocks, bonds, currencies, interest

rates and market indices. The Funds classify and measure financial instruments in accordance with IFRS 9, “Financial Instruments”. Upon initial recognition, financial instruments are measured at FVTPL. All financial assets and liabilities are recognized in the Statements of Financial Position when a Fund becomes a party to the contractual requirements of the instrument. Financial instruments are derecognized when the right to receive cash flows from the instrument has expired or a Fund has transferred substantially all risks and rewards of owner -ship. As such, investment purchase and sale transactions are recorded as of the trade date.

The Funds’ financial assets and financial liabilities, other than receivables and payables, are subsequently measured at FVTPL with changes in fair value recognized in the Statements of Comprehensive Income. Other receivables and payables are subsequently measured at amortized cost.

The Funds have determined that they meet the definition of an ‘investment entity’ and as a result, the Funds measure subsidiaries, if any, at FVTPL. An investment entity is an entity that: obtains funds from one or more investors for the purpose of providing them with investment management services; commits to its investors that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both; and measures and evaluates the performance of substantially all of its investments on a fair value basis. The Funds’ investments may also include associates and joint ventures which are measured at FVTPL.

The Funds’ outstanding redeemable units’ entitlements include a contractual obligation to distribute any net income and net realized capital gains in cash (at the request of the unitholder) and therefore the ongoing redemption feature is not the Funds’ only contractual obligation. Consequently, the Funds’ Net Assets Attributable to Holders of Redeemable Units are classified as financial liabilities in accordance with the requirements of IAS 32, “Financial Instruments: Presentation”. The Funds’ obligations for Net Assets Attributable to Holders of Redeemable Units are presented at the redemption amount.

The accounting policies for measuring the fair value of the Funds’ investments and derivatives are substantially similar to those used in measuring the Funds’ net asset value (“NAV”) for transactions with unitholders. The NAV is the value of the total assets of a fund less the value of its total liabilities determined, on each valuation day, in accordance with Part 14 of National Instrument 81-106, “Investment Fund Continuous Disclosure”, for the purpose of processing unitholder transactions. Net Assets Attributable to Holders of Redeemable Units, also referred to as Net Assets, refers to net assets calculated in accor -dance with IFRS. As at all dates presented, there were no differences between the Funds’ NAV per series unit and Net Assets per series unit.

nNotes to the Interim Financial Report (Unaudited)

June 30, 2019 Semi-Annual Financial Report12

Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of financial assets and liabilities traded in active markets (such as publicly traded derivatives and marketable securities) is based on quoted market prices at the close of trading on the reporting date. The Funds use the last traded market price for both financial assets and financial liabilities where the last traded price falls within that day’s bid-ask spread. In circumstances where the last traded price is not within the bid-ask spread, TDAM determines the point within the bid-ask spread that is most representative of fair value based on the specific facts and circumstances.

The fair value of financial assets and liabilities not traded in an active market, including over-the-counter derivatives, is determined using valuation techniques. The Funds use a variety of methods and make assumptions that are based on market conditions existing at each report-ing date. Valuation techniques include the use of comparable recent arm’s length transactions, reference to other instruments that are sub-stantially the same, discounted cash flow analysis, option pricing models and other techniques commonly used by market participants and which attempt to make the maximum use of observable inputs.

The valuation methodology for specific types of investments held by the Funds is summarized below.

(a) Securities not listed on any recognized public securities exchange are valued based on available quotations from recognized dealers in such securities, where readily available. If securities have no available broker-dealer bid/ask quotes, TDAM uses its own pricing model to price the securities. The pricing model will generally include the discounted cash flow valuation approach, the use of a credit spread based on the terms of the security and the use of such credit and yield analysis comparables as TDAM believes are relevant in the circumstances. Debt instruments are valued based on mid prices, where readily available. Other valuation techniques may be used, as described above, where applicable.

(b) Short-term debt instruments, repurchase and reverse repurchase agreements are valued based on quotations received from recognized investment dealers.

(c) Real return bonds are valued based on the available public quotations from recognized dealers. Changes in the inflation factor are included in Interest for Distribution Purposes in the Statements of Comprehensive Income.

(d) The Funds may use foreign exchange forward contracts to hedge against or profit from fluctuations in foreign exchange rates. These contracts are valued on each valuation day based on the difference between the contract rates and the current forward rates at the measurement date applied to the contracts’ notional amount. The net change in unrealized appreciation or depreciation and the net realized gain or loss from closing out contracts are reflected in the Statements of Comprehensive Income as part of Net Gain (Loss) on Investments and Derivatives.

(e) Options contracts that are traded in exchange markets are valued at their closing prices on each valuation day. The premium received or paid on options written or purchased is included in the cost of the options. Any difference between the current value of the contract and the value of the contract originated is recognized as Net Change in Unrealized Appreciation/Depreciation. When options are closed or exercised, the difference between the premium and the amount paid or received, or the full amount of the premium if the option expires worthless, is reflected in the Statements of Comprehensive Income as Net Realized Gain (Loss). The cost of a security purchased will be reduced by the premium received on options when a written put option is exercised or increased by the amount paid on options when a purchased option is exercised.

(f) The Funds may purchase standardized, exchange-traded futures contracts. Any difference between the value at the close of business on the current valuation day and that of the previous valuation day is settled in cash daily and recorded in the Statements of Comprehensive Income as Derivatives Income (Loss). Any cash deposits or borrowings on margin are reflected in the Statements of Financial Position as Margin Deposit (Payable) on Derivatives. Short-term debt instruments as indicated in the Schedule of Investment Portfolio have been segregated and are held as margin against the futures contracts purchased by the Funds, as applicable.

(g) The TD Mutual Fund Trusts may enter into a credit default swap (“CDS”) agreements to gain exposure to debt instruments without investing in them directly. A CDS agreement is a bilateral over- the-counter derivative contract between a protection buyer and a protection seller that exchange the credit risk of a specific issuer (reference entity). The protection buyer pays a periodic premium, often quarterly, to the protection seller to assume the credit risk associated with a particular credit event. Credit events include bankruptcy, a material default and debt restructuring for a specified reference asset. If a credit event occurs, the CDS agreements may be settled by either the physical delivery of the referenced asset for proceeds equal to par value or a cash payment equal to the loss amount. If there is no credit default event, no contingent amount is payable.

During the reporting periods, certain Funds have entered into CDS indices as protection seller. Any upfront payment made or received by these funds at the initiation of a CDS agreement is included in the CDS agreement’s fair value. Quarterly premiums received from the counterparty are accrued daily and recorded as Derivative Income (Loss) in the Statements of Comprehensive Income. Changes in the fair value of the CDS agreements outstanding at the reporting date are disclosed in the Statements of Comprehensive Income as Net Change in Unrealized Appreciation/Depreciation. Prices used to value the CDS are obtained directly from the data vendor or broker. When CDS agreements expire or are closed out, the net realized gain or loss is reflected in the Statements of Comprehensive Income as Net Realized Gain (Loss).

The Funds’ exposure to CDS is limited to the notional amount of the contract less any applicable recoverable amount, calculated by the product of the notional amount and the recovery rate of the respective reference entity.


Semi-Annual Financial ReportJune 30, 2019 13

(h) The exchange-traded funds (“ETFs”) that are not managed by TDAM are valued based on quoted market prices at the close of trading on the reporting date.

(i) Investments in underlying conventional mutual funds and TDAM managed ETFs are generally valued at the NAV per series unit of the investment funds as reported by the investment funds’ managers.

Fair Value Hierarchy The Funds classify their investments into fair value measurements within a hierarchy that prioritizes the inputs to fair value measurement. The fair value hierarchy has the following three levels:

Level 1 Quoted (unadjusted) prices in active markets for identical assets or liabilities;

Level 2 Inputs other than quoted prices that are observable for the asset or liability either directly (that is, as prices) or indirectly (that is, derived from prices); and

Level 3 Inputs that are not based on observable market data (that is, unobservable inputs).

All fair value measurements are recurring. The carrying values of Cash, Margin Deposit on Derivatives, Subscriptions Receivable, Interest and Dividends Receivables, Receivable for Investments Sold, Bank Overdraft, Margin Payable on Derivatives, Payable for Investments Purchased, Redemptions Payable, Distributions Payable, Accrued Liabilities and the redemption value of Funds’ obligation for Net Assets Attributable to Holders of Redeemable Units approximate their fair values due to their short-term nature.

Fair values are classified as Level 1 when the related security or deriva-tive is actively traded and a quoted price is available. If an instrument classified as Level 1 subsequently ceases to be actively traded, it is transferred out of Level 1. In such cases, instruments are reclassified into Level 2, unless the measurement of their fair value requires the use of significant unobservable inputs, in which case they are classified as Level 3. The Funds’ policy is to recognize transfers into and out of the fair value hierarchy levels at the end of the reporting period.

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).

The classification within the hierarchy is based on the lowest level input that is significant to the fair value measurement. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgement, considering factors specific to the asset or liability.

The determination of what constitutes ‘observable’ requires significant judgement. Observable data is considered to be that market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.

TDAM has a Global Fair Value Committee which oversees the perform -ance of the fair value measurements included in the financial statements of the Funds, including any Level 3 measurements. TDAM utilizes a variety of methods (as listed in the Fair Value Measurement section) in determining the fair value of securities classified as Level 3. The committee also meets quarterly to perform reviews of the valuations of investments held by the Funds.

The classification of the Funds’ financial instruments within the fair value hierarchy as at June 30, 2019 and December 31, 2018, and any transfers between levels at the end of the reporting periods as a result of changes in the lowest level input that is significant to the fair value measurement are disclosed in the Fund-Specific Notes, where applicable.

Interest in Unconsolidated Structured Entities A structured entity is an entity that has been designed so that voting or similar rights are not the dominant factor in deciding who controls the entity, such as when any voting rights relate to administrative tasks only and the relevant activities are directed by means of contractual arrangements. TDAM has determined that all of the underlying invest-ment funds (“Underlying Funds”) in which the Funds invest are unconsolidated structured entities. Underlying Funds include conven-tional mutual funds and ETFs. In making this determination, TDAM evaluated the fact that decision making about Underlying Funds’ activities is generally not governed by voting or similar rights held by the Funds and other investors in any Underlying Funds.

The Funds may invest in Underlying Funds whose investment objectives range from seeking to achieve short- to long-term income and/or capital growth potential. The Funds’ interests in these securities as at June 30, 2019 and December 31, 2018 are included at their fair value in the Statements of Financial Position, which represent the Funds’ exposure in these Underlying Funds. The Funds do not provide and have not committed to provide any additional significant financial or other support to the Underlying Funds. The change in fair value of each of the Underlying Funds during the reporting periods is included in Net Change in Unrealized Appreciation/Depreciation in the Statements of Comprehensive Income as part of Net Gain (Loss) on Investments and Derivatives. Additional information on the Funds’ interest in Underlying Funds, where applicable, is provided in the Schedule of Investment Portfolio and Fund-Specific Notes.

The TD Mutual Fund Trusts may also invest in mortgage-related and/or other asset-backed securities that directly or indirectly represent a participation in, or are secured by and payable from, mortgage loans on real property. Mortgage-related securities are created from pools of residential or commercial mortgage loans, including mortgage loans made by savings and loan institutions, mortgage bankers, commercial banks and others. The debt and equity securities issued by these issuers may include tranches with varying levels of subordination. The Funds may invest in senior notes that have a first lien on assets and have minimum exposure to junior or subordinate tranches. These securities may provide a monthly payment which consists of both interest and principal payments. Other asset-backed securities are created from many types of assets, including auto loans, credit card receivables, home equity loans, and student loans.


June 30, 2019 Semi-Annual Financial Report14

As at June 30, 2019 and December 31, 2018, the fair value of mortgage-related and other asset-backed securities of these funds, where applicable, is disclosed as Investments in the Statements of Financial Position. The fair value represents the maximum exposure to losses at those dates. The change in fair value of mortgage-related and other asset-backed securities during the reporting periods is included in Net Change in Unrealized Appreciation/Depreciation in the Statements of Comprehensive Income as part of Net Gain (Loss) on Investments and Derivatives.

Translation of Foreign Currencies A Fund’s functional currency, as disclosed in the Fund-Specific Notes, represents the currency that TDAM views to most faithfully represent the economic effects of the Fund’s underlying transactions, events and conditions taking into consideration how units are issued or redeemed and how returns are measured. Foreign currency transactions are trans-lated into the functional currency using the exchange rates prevailing at the dates that transactions occur. Realized foreign exchange gains and losses on income are recognized as income in the Statements of Comprehensive Income.

Assets and liabilities denominated in a foreign currency are translated into the functional currency using the exchange rate prevailing at the measurement date. Foreign exchange gains and losses on the sale of investments are included in Net Realized Gain (Loss). Unrealized foreign exchange gains and losses on investments held and other assets and liabilities are included in Net Change in Unrealized Appreciation/ Depreciation. Realized and unrealized foreign exchange gains an

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