Dear Shareholders:
Investment Results - Fiscal Year Ended October 31, 1999
The AAM Equity Fund (the "Fund") ended its October fiscal year with a positive
return of 16.74%. Investment results:
- -------------------------------------------------------------------------------
Comparative AAM S&P 500 Dow Jones Index
Investment Returns Equity Fund Index
- -------------------------------------------------------------------------------
1 Year Ending 10/31/1999 16.74% 25.64% 26.99%
- -------------------------------------------------------------------------------
Since Inception 10.09% 22.45% 22.62%
- -------------------------------------------------------------------------------
Since Inception (annualized) 7.44% 16.32% 16.44%
- -------------------------------------------------------------------------------
06/30/1998 (Inception) 10/31/98 4/30/99 10/31/1999 (Fiscal Year End)
10000 9430 11120 11009
10000 9750 11920 12245
10000 9660 12230 12262
The chart shows the value of a hypothetical initial investment of $10,000 in the
fund, the S&P 500 index and the Dow Jones Index on June 30, 1998 and held
through October 31, 1999.
1
<PAGE>
From inception on June 30, 1998, the AAM Equity Fund (the "Fund") has
accumulated more than $4,000,000 in net assets.
Investment Approach
To remind our shareholders, the AAM Equity Fund's investment approach is to
achieve long-term growth of capital by investing in high quality large and
mid-cap U.S. companies. We select companies which are leaders in their various
industries which we believe will provide the greatest potential return over an
18 month to two year time horizon.
Commentary and Outlook
As of the end of September, the S&P 500 was up a little over 5%, which masks the
fact that for most stocks this has been a tough year. The average stock in the
S&P 500 is down more than 20% from its 52 week high, so the odds of owning a
winning stock portfolio are difficult at best.
The technology sector continues to be a bright spot and now represents over 25%
of the S&P 500. Stock market volatility continues to be quite intense and the
technology sector is showing some strain. Earnings reports have been erratic
and, each month, we wait to see if Chairman Greenspan will raise interest rates.
This is not the best time for the faint of heart to invest in the latest hot
stock idea.
The Fund portfolio continues to be conservatively composed; but, we have
increased our technology weighting and continue to believe diversification is
essential to decreasing the effect of market decline. We, at AAM, have always
been attracted to value stocks and this has made it somewhat difficult to keep
pace with the S&P 500. We continue to be confident that, eventually, the market
will payoff for companies that have a consistent earnings history and, sooner
than later, the rush of new ".com" stocks will have a major setback.
The Fund is currently over 94% invested and we continue to search for unique
investment opportunities that we can purchase at a fair market value. The next
twelve months may prove to be very interesting for the Internet industry and we
believe the stock market is still the best place to invest available dollars.
Sincerely,
Knox H. Fuqua
President and Chief Investment Officer
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
2
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
AAM Equity Fund
Schedule of Investments - October 31, 1999
<S> <C> <C>
Common Stock - 94.3% Shares Value
BASIC INDUSTRIES - 9.6%
Chemicals & Plastics - 0.9%
Air Products & Chemicals 1,400 $ 38,500
------------------
------------------
Manufacturers - Diversified - 4.1%
AlliedSignal, Inc. 1,300 74,019
Tredegar Industry 2,500 54,844
Tyco International, Inc. 1,200 47,925
------------------
------------------
176,788
------------------
------------------
Metals & Mining - 1.7%
Alcoa, Inc. 1,200 72,900
------------------
------------------
Packaging & Containers - 1.4%
Chesapeake Corp. 2,000 60,000
------------------
------------------
Paper & Forest Products - 1.5%
Avery Dennison Corp. 1,075 67,187
------------------
------------------
TOTAL BASIC INDUSTRIES 415,375
------------------
------------------
CONSTRUCTION & REAL ESTATE - 1.9%
Construction - 1.9%
Martin Marietta Materials 2,100 81,769
------------------
------------------
DURABLES - 3.2%
Autos & Auto Parts - 1.6%
Ford Motor Company 1,250 68,594
------------------
------------------
Consumer Electronics - 1.6%
Circuit City Group 1,600 68,300
------------------
------------------
TOTAL DURABLES 136,894
------------------
------------------
ENERGY - 9.0%
Energy Services - 3.4%
Halliburton Co. 2,000 75,375
Schlumberger Ltd. 1,200 72,675
------------------
------------------
148,050
------------------
------------------
Oil & Gas - 5.6%
Atlantic Richfield 1,000 93,188
Chevron Corp. 750 68,484
Conoco Inc. - Class B 3,000 82,312
------------------
------------------
243,984
------------------
------------------
TOTAL ENERGY 392,034
------------------
------------------
AAM Equity Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
FINANCE - 16.0%
Banks - 5.5%
CCB Financial 1,200 $ 55,200
Citigroup, Inc. 1,500 81,188
SunTrust Banks 800 58,550
Wachovia Corp. 500 43,125
------------------
------------------
238,063
------------------
------------------
Diversified - 2.9%
BB&T Corp 1,800 65,475
Capital One Financial 1,125 59,625
------------------
------------------
125,100
------------------
------------------
Insurance - 6.3%
American International Group 875 90,070
Berkshire Hathaway, Inc. - Class B (a) 25 52,250
Markel Corp. (a) 400 69,175
St. Paul Cos 2,000 64,000
------------------
------------------
275,495
------------------
------------------
Real Estate Investment Trusts - 1.3%
Federal Rlty Inv Tr. SBI 3,000 54,562
------------------
------------------
TOTAL FINANCE 693,220
------------------
------------------
HEALTH - 10.6%
Diversified - 5.4%
American Home Products, Inc. 1,200 62,700
Bristol-Myers Squibb, Inc. 1,250 96,016
Johnson & Johnson, Inc. 700 73,325
------------------
------------------
232,041
------------------
------------------
Drugs & Pharmaceuticals - 5.2%
Amgen, Inc. (a) 900 71,775
Merck & Co., Inc. 1,000 79,563
Schering-Plough, Inc. 1,500 74,250
------------------
------------------
225,588
------------------
------------------
TOTAL HEALTH 457,629
------------------
------------------
INDUSTRIAL MACHINERY & EQUIPMENT - 4.0%
Electrical Equipment - 2.3%
General Electric, Inc. 750 101,672
------------------
------------------
Industrial Machinery & Equipment - 1.7%
Deere & Co. 2,000 72,500
------------------
------------------
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 174,172
------------------
------------------
AAM Equity Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
MEDIA & LEISURE - 7.6%
Broadcasting - 6.4%
AT&T Liberty Media Group - Class A (a) 1,775 $ 70,445
Cox Communications - Class A (a) 2,000 90,875
Media General, Inc. 1,150 62,819
MediaOneGroup (a) 750 53,297
------------------
------------------
277,436
------------------
------------------
Entertainment - 1.2%
Disney (Walt) Co. 2,000 52,750
------------------
------------------
TOTAL MEDIA & LEISURE 330,186
------------------
------------------
NON-DURABLES - 5.4%
Beverages - 3.0%
Anheuser-Busch Cos 975 70,017
Coca-Cola Co. 1,000 59,000
------------------
------------------
129,017
------------------
------------------
Foods - 1.6%
Sara Lee Corp. 2,500 67,656
------------------
------------------
Household Products - 0.8%
Gillette Co. 1,000 36,188
------------------
------------------
TOTAL NON-DURABLES 232,861
------------------
------------------
RETAIL & WHOLESALE - 5.1%
Department Stores - 1.6%
Saks, Inc. (a) 4,000 68,750
------------------
------------------
Drug Stores - 1.1%
Walgreen Co. 1,900 47,856
------------------
------------------
Specialty - 2.4%
Sysco Corp. 1,600 61,500
Zale Corp. (a) 1,025 42,922
------------------
------------------
104,422
------------------
------------------
TOTAL RETAIL & WHOLESALE 221,028
------------------
------------------
TECHNOLOGY - 14.2%
Communications Equipment - 1.7%
Motorola, Inc. 750 73,078
------------------
------------------
AAM Equity Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
TECHNOLOGY - continued
Computer Services & Software - 2.8%
EMC Corp (a) 950 $ 69,350
Microsoft, Inc. (a) 600 55,537
------------------
------------------
124,887
------------------
------------------
Computers & Office Equipment - 5.7%
Cisco Systems, Inc. (a) 1,300 96,200
Hewlett-Packard Co. 700 51,844
International Business Machines, Inc. 1,000 98,375
------------------
------------------
246,419
------------------
------------------
Electronic Instruments - 2.2%
Koninklijke Philips Electron N (c) 920 95,622
------------------
------------------
Electronics - 1.8%
Intel Corp. 1,000 77,437
------------------
------------------
TOTAL TECHNOLOGY 617,443
------------------
------------------
TRANSPORTATION - 1.4%
Railroads - 1.4%
Norfolk Southern 2,500 61,094
------------------
------------------
UTILITIES - 6.3%
Natural Gas - 1.8%
Enron Corp. 2,000 79,875
------------------
------------------
Telephone Services - 4.5%
AT&T Corp. 1,100 51,425
MCI WorldCom (a) 800 68,650
SBC Communications, Inc. 1,500 76,406
------------------
------------------
196,481
------------------
------------------
TOTAL UTILITIES 276,356
------------------
------------------
Total Common Stock - (Cost $3,622,347) 4,090,061
------------------
------------------
Principal
Money Market Securities - 5.0% Amount Value
Firstar Treasury Fund, 4.41% (b) (Cost $216,063) $ 216,063 216,063
------------------
------------------
TOTAL INVESTMENTS - (Cost $3,838,410) - 99.3% 4,306,124
------------------
------------------
Other assets less liabilities - 0.7% 30,622
------------------
------------------
Total Net Assets - 100.0% $ 4,336,746
==================
==================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at October
31, 1999.
(c) American Depository Receipt
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AAM Equity Fund October 31, 1999
Statement of Assets and Liabilities
<S> <C> <C>
Assets
Investment in securities, at value (cost $3,838,410) $ 4,306,124
Dividends receivable 3,366
Interest receivable 863
Receivable from investment advisor for
reimbursed expenses 8,303
Deferred organizational costs 22,692
------------------
Total assets 4,341,348
Liabilities
Payable to custodian bank $ 628
Accrued investment advisory fee payable 3,974
-----------------
Total liabilities 4,602
------------------
Net Assets $ 4,336,746
==================
Net Assets consist of:
Paid in capital $ 3,944,979
Accumulated undistributed net investment income 16,393
Accumulated net realized gain (loss) on investments (92,340)
Net unrealized appreciation on investments 467,714
------------------
Net Assets, for 394,761 shares $ 4,336,746
==================
Net Asset Value
Net Assets
Offering price and redemption price per share ($4,336,746 / 394,761) $ 10.99
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AAM Equity Fund
Statement of Operations for the year ended October 31, 1999
<S> <C> <C>
Investment Income
Dividend Income $ 52,917
Interest Income 7,225
-------------------
Total Income 60,142
Expenses
Investment advisory fee 43,749
Organizational expenses 6,198
Trustees' fees 1,377
-------------------
Total expenses before reimbursement 51,324
Reimbursed expenses (7,575)
-------------------
Total operating expenses 43,749
-------------------
Net Investment Income 16,393
-------------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities (54,500)
Change in net unrealized appreciation (depreciation)
on investment securities 568,946
-------------------
Net gain on investment securities 514,446
-------------------
Net increase in net assets resulting from operations $ 530,839
===================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AAM Equity Fund
Statement of Changes in Net Assets
<S> <C> <C>
Year Period
ended ended
October 31, October 31,
1999 1998 (a)
----------------- -----------------
Increase (Decrease) in Net Assets
Operations
Net investment income $ 16,393 $ 7,205
Net realized gain (loss) on investment securities (54,500) (37,840)
Change in net unrealized appreciation (depreciation) 568,946 (101,232)
----------------- -----------------
Net increase (decrease) in net assets resulting from operations 530,839 (131,867)
----------------- -----------------
Distributions to shareholders
From net investment income (7,205) -
----------------- -----------------
Share Transactions
Net proceeds from sale of shares 1,493,997 2,990,242
Shares issued in reinvestment of dividends 4,455 -
Shares redeemed (537,268) (6,447)
----------------- -----------------
Net increase in net assets resulting
from share transactions 961,184 2,983,795
----------------- -----------------
Total increase in net assets 1,484,818 2,851,928
Net Assets
Beginning of period 2,851,928 -
----------------- -----------------
End of period [including accumulated undistributed net
investment income of $16,393 and $7,205, respectively] $ 4,336,746 $ 2,851,928
================= =================
(a) June 30, 1998 (commencement of operations) to October 31, 1998.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AAM Equity Fund
Financial Highlights
<S> <C> <C>
Year Period
ended ended
October 31, October 31,
1999 1998 (a)
----------------- -----------------
Selected Per Share Data
Net asset value, beginning of period $ 9.43 $ 10.00
----------------- -----------------
Income from investment operations
Net investment income 0.05 0.03
Net realized and unrealized gain (loss) 1.53 (0.60)
----------------- -----------------
Total from investment operations 1.58 (0.57)
----------------- -----------------
Distribution to shareholders from
net investment income (0.02) -
----------------- -----------------
Net asset value, end of period $ 10.99 $ 9.43
================= =================
Total Return (b) 16.74% (5.70)%
Ratios and Supplemental Data
Net assets, end of period (000) $4,337 $2,852
Ratio of expenses to average net assets 1.15% 1.14% (c)
Ratio of expenses to average net assets before reimbursement 1.35% 1.40% (c)
Ratio of net investment income to average net assets 0.43% 0.90% (c)
Ratio of net investment income to average net assets
before reimbursement 0.23% 0.64% (c)
Portfolio turnover rate 27.34% 14.41% (c)
(a) June 30, 1998 (commencement of operations) to October 31, 1998
(b) For periods of less than a full year, total returns are not annualized.
(c) Annualized
</TABLE>
<PAGE>
AAM Equity Fund
Notes to Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
AAM Equity Fund (the "Fund") is organized as a series of the AmeriPrime
Funds, an Ohio business trust (the "Trust"). The Fund is registered under the
Investment Company Act of 1940, as amended, as a diversified open-end management
investment company. The Fund's investment objective is to provide long-term
capital appreciation. The Declaration of Trust permits the Trustees to issue an
unlimited number of shares of beneficial interest of separate series without par
value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuations- Securities which are traded on any exchange or on
the NASDAQ over-the-counter market are valued at the last quoted sale price.
Lacking a last sale price, a security is valued at its last bid price except
when, in the Advisor's opinion, the last bid price does not accurately reflect
the current value of the security. All other securities for which
over-the-counter market quotations are readily available are valued at their
last bid price. When market quotations are not readily available, and the
Advisor determines the last bid price does not accurately reflect the current
value or when restricted securities are being valued, such securities are valued
as determined in good faith by the Advisor, in conformity with guidelines
adopted by and subject to review of the Board of Trustees of the Trust (the
"Board").
Fixed income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Advisor,
subject to review of the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
AAM Equity Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes- The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains.
Dividends and Distributions- The Fund intends to comply with federal tax rules
regarding distribution of substantially all of its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year.
Other- The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Appalachian Asset Management, Inc. (the "Advisor") to
manage the Fund's investments. The advisor is controlled by its President, Knox
H. Fuqua. Mr. Fuqua is primarily responsible for the day-to-day management of
the Fund's portfolio.
Under the terms of the management agreement, (the "Agreement"), the Advisor
manages the Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of the Fund except brokerage commissions, taxes,
interest, fees and expenses of non-interested person trustees, and extraordinary
expenses, including organizational expenses. As compensation for its management
services and agreement to pay the Fund's expenses, the Fund is obligated to pay
the Advisor a fee computed and accrued daily and paid monthly at an annual rate
of 1.15% of the average daily net assets of the Fund. It should be noted that
most investment companies pay their own operating expenses directly, while the
Fund's expenses, except those specified above, are paid by the Advisor. For the
year ended October 31, 1999, the Advisor received a fee of $43,749 from the
Fund. The Advisor has voluntarily agreed to reimburse other expenses for the
fiscal year ended October 31, 1999 to the extent necessary to maintain total
operating expenses at the rate of 1.15%. For the year ended October 31, 1999,
the Advisor reimbursed expenses of $7,575. There is no assurance that such
reimbursement will continue in the future.
AAM Equity Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Fund's business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment and
personnel. For the year ended October 31, 1999, the Administrator received fees
of $30,000 from the Advisor for administrative services provided to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. ("the Distributor")
to act as the principal distributor of the Fund's shares. There were no payments
made to the Distributor for the year ended October 31, 1999. Certain members of
management of the Administrator and the Distributor are also members of
management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, there was an unlimited number of authorized shares
for the Fund. Paid in capital at October 31, 1999 was $3,944,979.
Transactions in shares were as follows:
<TABLE>
- --------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year ended Year ended
October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares Dollars Shares Dollars
- -------------------------------------------------------------------------------------------------------------------------
Shares sold 144,204 $1,493,997 303,178 $2,990,242
- -------------------------------------------------------------------------------------------------------------------------
Shares issued in reinvestment of dividends
393 4,455 -- --
- -------------------------------------------------------------------------------------------------------------------------
Shares redeemed (52,307) (537,268) (707) (6,447)
- -------------------------------------------------------------------------------------------------------------------------
92,290 $961,184 302,471 $2,983,795
- -------------------------------------------------------------------------------------------------------------------------
====== ======== ====== =======
</TABLE>
AAM Equity Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 5. INVESTMENTS
For the year ended October 31, 1999, purchases and sales of investment
securities, other than short-term investments, aggregated $1,761,879 and
$982,324, respectively. At October 31, 1999, the unrealized appreciation for all
securities totaled $680,808 and the gross unrealized depreciation for all
securities totaled $213,094 for a net unrealized appreciation of $467,714. The
aggregate cost of securities for federal income tax purposes at October 31, 1999
was $3,838,410.
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 7. RELATED PARTY TRANSACTIONS
The Advisor is not a registered broker-dealer of securities and thus does
not receive commissions on trades made on behalf of the Fund. The beneficial
ownership, either directly or indirectly, of more than 25% of the voting
securities of a Fund creates a presumption of control of the Fund, under Section
2(a)(9) of the Investment Company Act of 1940. As of October 31, 1999, National
Financial Services Corp. owned of record in aggregate more than 56% of the Fund.
<PAGE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
AAM Equity Fund (a series of the Ameriprime Funds)
We have audited the accompanying statement of assets and liabilities of the AAM
Equity Fund, including the schedule of portfolio investments, as of October 31,
1999, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period then
ended, and financial highlights for the year ended October 31, 1999 and the
period from June 30, 1998 (commencement of operations) to October 31, 1998 in
the period then ended. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
AAM Equity Fund as of October 31, 1999, the results of its operations for the
year then ended, the changes in its net assets for each of the two years in the
period then ended, and the financial highlights for the year ended October 31,
1999 and the period from June 30, 1998 (commencement of operations) to October
31, 1998, in the period then ended, in conformity with generally accepted
accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
<PAGE>
Dear Fellow Shareholders:
Investment Results - Fiscal Year Ended October 1999
The GLOBALT Growth Fund (the "Fund"), whose ticker symbol is GROWX, ended its
October fiscal year with a 26.67% total return for the year. The net asset value
was $19.53 at fiscal year end. The Fund has returned 127.71% (net of fees) since
inception December 1, 1995. Please note that the Fund paid a dividend on
December 29, 1999.
Growth of $25,000
Russell
Period GGF S&P 500 1000 Growth
- ------------ ---------- ---------- ----------
Beginning 12/1/95
$25,000 $25,000 $25,000
Dec-95 $26,600 $25,483 $25,143
Jan-96 $27,600 $26,349 $25,984
Feb-96 $28,199 $26,594 $26,460
Mar-96 $28,549 $26,849 $26,495
Apr-96 $29,074 $27,244 $27,190
May-96 $29,400 $27,947 $28,142
Jun-96 $29,400 $28,053 $28,180
Jul-96 $28,074 $26,813 $26,537
Aug-96 $28,871 $27,379 $27,217
Sep-96 $30,647 $28,920 $29,198
Oct-96 $31,195 $29,718 $29,372
Nov-96 $33,295 $31,965 $31,577
Dec-96 $31,913 $31,332 $30,966
Jan-97 $33,914 $33,289 $33,133
Feb-97 $33,052 $33,550 $32,908
Mar-97 $31,558 $32,172 $31,128
Apr-97 $33,862 $34,092 $33,195
May-97 $35,836 $36,168 $35,597
Jun-97 $37,506 $37,788 $37,025
Jul-97 $40,773 $40,795 $40,303
Aug-97 $39,077 $38,510 $37,947
Sep-97 $40,902 $40,619 $39,814
Oct-97 $39,663 $39,262 $38,343
Nov-97 $40,424 $41,080 $39,967
Dec-97 $41,063 $41,785 $40,415
Jan-98 $41,342 $42,247 $41,623
Feb-98 $44,377 $45,294 $44,753
Mar-98 $46,382 $47,613 $46,539
Apr-98 $47,663 $48,092 $47,181
May-98 $46,466 $47,266 $45,841
Jun-98 $48,859 $49,186 $48,651
Jul-98 $48,219 $48,662 $48,330
Aug-98 $40,533 $41,626 $41,076
Sep-98 $42,203 $44,293 $44,231
Oct-98 $44,929 $47,894 $47,787
Nov-98 $47,854 $50,797 $51,423
Dec-98 $51,668 $53,724 $56,062
Jan-99 $54,438 $55,970 $59,353
Feb-99 $51,378 $54,231 $56,640
Mar-99 $52,925 $56,401 $59,625
Apr-99 $54,237 $58,585 $59,703
May-99 $53,451 $57,202 $57,870
Jun-99 $56,246 $60,376 $61,921
Jul-99 $54,266 $58,492 $59,951
Aug-99 $54,239 $58,199 $60,929
Sep-99 $53,306 $56,604 $59,649
Oct-99 $56,920 $60,187 $64,153
|X| Past performance is not predictive of future performance.
|X| The GLOBALT Growth Fund's historical results are net of all expenses,
versus the gross market benchmark (the S&P 500 Index). Investors are
reminded that when trying to achieve benchmark returns, investment
management fees, transaction costs and execution costs will be incurred.
|X| The S&P 500 Index is an unmanaged index of 500 selected common stocks, most
of which are listed on the New York Stock Exchange. The Index is adjusted
for dividends and weighted toward stocks with large market capitalizations.
|X| Inception Date: December 1, 1995.
We welcome our new shareholders and look forward to furthering the investment
objectives of all our shareholders. We believe it is important to note that all
GLOBALT 401(k) plan participants have elected to be investors in the Fund and
collectively are among the Fund's largest shareholders.
Investment Approach
To review, our approach to managing the GLOBALT Growth Fund is to achieve
long-term growth of capital by investing in U.S. companies which we believe
offer superior growth potential through exposure to rapidly growing
international markets. The Fund only invests in stocks of U.S. companies that
are expected to derive a portion of their revenues outside the U.S. GLOBALT's
investment team seeks to optimize the Fund's exposure to the best global
opportunities.
Performance Review
We remind investors that the basic strategy of the Fund is to construct and
manage a well-diversified, risk-controlled portfolio with the objective of
outperforming broad market benchmarks over a market cycle. The turmoil in many
of the economies in Asia and Latin America in 1998 and early 1999 have resulted
in the most challenging environment the Fund has faced since its inception. The
global economic outlook is improving which should benefit globally competitive
U.S. companies and the Fund's strategy.
The Fund's strong performance in the later part of the fiscal year resulted in a
total return of 26.67% for the fiscal year ended October 31, 1999. This
surpassed the 25.67% return for the S&P 500 Index for same period.
In light of the recent press concerning capital gains taxes on mutual fund
distributions, we would like to stress to investors that the GLOBALT Growth Fund
is managed using a tax efficient strategy. The Fund achieved its return with
comparatively few capital gains for fiscal year 1999 and therefore low taxable
gains for investors. We continue to strive to effectively manage our
distributions.
Commentary and Outlook
Future Growth is in the New Economy
We believe that the world economic order has changed permanently. Globalization
of industries, unfathomable advances in technology/productivity, and business
conducted on the Internet are combining to create very fast-paced, brutally
competitive conditions, with powerful deflationary characteristics.
Thus, there is more to the current stalling of earnings and price momentum of
value/commodity/ cyclical companies than concern over interest rates. Strategies
that depend on cyclical recovery of product prices likely will be impaired. We
also think that there is more to the near-obsession with technology stocks than
just speculation. The basic means by which business is conducted is experiencing
nothing short of a revolution. The chairman of Intel said recently that in five
years time, all companies will have transformed themselves into Internet
companies because it will be "mandatory and not optional" to conduct business
via the Internet. These changes have overwhelming investment significance, and
we believe portfolio managers must adapt to them to be successful in the years
ahead. They aren't going to go away.
We cannot predict short-term trends as there are simply too many unresolved
issues and too many moving parts. We can focus on the major variables that
ultimately drive stock prices. The market will likely continue to focus on
quality and growth (earnings momentum), and favor large cap over small cap. By
definition, our portfolios are centered on these attributes and will continue to
be. As implied throughout, longer term it is imperative to recognize "new
growth," particularly in the technology and telecommunication sectors. Change is
occurring there at warp speed, further intensified by industry consolidation.
By no means is the long period of out-performance by large cap stocks, and
renewed current interest, a matter of default. One of the primary reasons for
their strong relative performance is superior sales growth. A recent study by
Tom Galvine of Donaldson Lufkin Jenrette looks at sales growth among the
largest, middle and smallest thirds of the S&P 500 Index by market
capitalization. Within the sectors, the largest third experienced 13% sales
growth on average versus 8% for the middle third and only 3% for the smallest
capitalization names. Given this rapid growth despite their large size, it is
understandable why investors have made larger capitalization names their
preferred investments. These companies are clearly taking share in an ever more
complex global marketplace and are reaping the reward of relatively high
valuations from investors.
The Internet economy is having a far-reaching impact on business and lifestyle.
It is creating large new markets, but in the process raising the risks to
traditional businesses that may adapt too slowly to change. We are committed to
investing in companies that will both build and exploit this new e-economy. Some
repositioning of portfolios has and will continue to be necessary as we sort out
the direction of change and the likely beneficiaries. Some of the companies we
invest in will be less familiar but are well-respected global leaders in their
fields. "Democratization" is occurring in some emerging technologies, in which
newer companies, often founded or managed by experienced people from larger
organizations, can compete successfully with long established companies.
Currently, earnings momentum (uninterrupted growth in earnings on a
year-over-year basis) is the only game in town. Investment cycles have been
shortened and volatility has increased. More turnover is necessary in
diversified portfolios in order to be in the vanguard. We are attempting to take
advantage of the volatility by trading more often but in smaller denominations
in order to keep money in stocks that are succeeding and to minimize portfolio
risk.
The improvement in world economies has two portfolio construction implications
for us. First, many of our traditional companies, for example in the Consumer
Non-Durables and Consumer Services sectors, derive 30% to 60% of their revenues
from abroad and are experiencing increased demand. For two years we have reduced
and maintained low exposure to Asia in particular, but for several months we
have been actively working to increase non-U.S. revenue exposure. Secondly, we
believe that strength in international economies will build gradually over the
next several years, and that the best situated companies in the more cyclical
Business Equipment & Services and Capital Goods sectors will demonstrate
sustained growth over a three to five-year period. They have corrected sharply
after their second quarter upward bounces and represent attractive values, and
we are interested in using the best of these to add return and diversification
to our portfolios. Financial service companies are inexpensive and should
outperform once the interest rate controversy is resolved.
We accept that high volatility is now a permanent part of the investment
environment. It almost certainly means that quarterly patterns of results, even
of successful portfolios, will be more divergent - if for no other reason than
because the make-up of benchmarks are also changing and becoming more volatile.
Nevertheless, we are convinced that a longer-term vision of the global
environment will yield opportunities to use short-term volatility to the
advantage of portfolios.
With the world economic wind at our back now, we believe we are entering a
several year cycle where portfolios of globally-competitive U.S. companies will
be in their "sweet-spot."
As always, your questions and comments are welcome. We appreciate your
confidence in the GLOBALT Growth Fund.
Sincerely,
Samuel E. Allen
Chief Executive Officer
Fund Investment
Shares of the Fund are sold on a continuous basis.
Through the Fund's transfer agent, Unified Fund Services, you may invest any
amount you choose as often as you wish, subject to a minimum initial investment
of $25,000 and minimum subsequent investments of $5,000 ($2,000 for IRA
accounts). Shares may also be purchased through a broker dealer or other
financial institution authorized by the Fund's distributor (investors may be
charged a fee for this service). Purchases can be made by mail or by bank wire
(please see prospectus for more information).
The Fund is also available through Fidelity's FUNDSNetwork with a minimum
investment of $2,500 ($1,000 through a qualified retirement plan). It is listed
as the AmeriPrime Funds - GLOBALT Growth Fund (symbol: GROWX). Fidelity can be
reached at 1-800-544-9697.
The Fund is also available through the Schwab Mutual Fund OneSource service at
1-800-435-4000 or on the Internet at www.schwab.com. The minimum investment in
the Fund through this service is $2,500 ($1,000 through a qualified retirement
plan). The GLOBALT Growth Fund's mutual fund symbol at Schwab is GROWX. This
enables the GLOBALT Growth Fund to be included as an investment option in 401(k)
plans.
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
<PAGE>
<TABLE>
<CAPTION>
GLOBALT GROWTH FUND
SCHEDULE OF INVESTMENTS - OCTOBER 31, 1999
<S> <C> <C>
COMMON STOCKS - 94.6% SHARES VALUE
Advertising - 5.3%
Interpublic Group 9,600 $ 390,000
Omnicom Group 5,800 510,400
-----------------------
-----------------------
900,400
-----------------------
-----------------------
BANKS - 5.2%
Bank of America Corp. 5,300 341,188
Citigroup, Inc. 10,050 543,956
-----------------------
-----------------------
885,144
-----------------------
-----------------------
BEVERAGES - 2.7%
Coca-Cola Co. 5,850 345,150
Coca-Cola Enterprises 4,600 117,588
-----------------------
-----------------------
462,738
-----------------------
-----------------------
COMMUNICATIONS EQUIPMENT - 2.4%
Lucent Technologies, Inc. 6,200 398,350
-----------------------
-----------------------
Computer Services & Software - 17.7%
America Online, Inc. (a) 2,500 324,219
BMC Software (a) 6,000 385,125
Computer Sciences Corp. (a) 6,100 418,994
EMC Corp (a) 2,900 211,700
Microsoft, Inc. (a) 4,800 444,300
Oracle Corp. (a) 9,700 461,356
Veritas Software (a) 7,000 755,125
-----------------------
-----------------------
3,000,819
-----------------------
-----------------------
COMPUTERS & OFFICE EQUIPMENT - 8.8%
Cisco Systems, Inc. (a) 7,324 541,976
Dell Computer Corp. (a) 3,600 144,450
International Business Machines, Inc. 3,620 356,117
Sun Microsystems, Inc. (a) 4,300 454,994
-----------------------
-----------------------
1,497,537
-----------------------
-----------------------
DRUGS & PHARMACEUTICALS - 3.7%
Merck & Co., Inc. 3,300 262,556
Pfizer, Inc. 9,300 367,350
-----------------------
-----------------------
629,906
-----------------------
-----------------------
ELECTRIC UTILITY - 1.2%
AES Corp. (a) 3,500 197,531
-----------------------
-----------------------
Electrical Equipment - 4.2%
General Electric, Inc. 5,200 704,925
-----------------------
-----------------------
GLOBALT GROWTH FUND
SCHEDULE OF INVESTMENTS - OCTOBER 31, 1999 - CONTINUED
COMMON STOCKS - CONTINUED SHARES VALUE
Electronic Instruments - 5.8%
Emerson Electric 3,300 $ 198,206
Honeywell, Inc. 2,800 295,225
Molex, Inc.- Class A 14,800 488,400
-----------------------
-----------------------
981,831
-----------------------
-----------------------
ELECTRONICS - 1.3%
Intel Corp. 2,800 216,825
-----------------------
-----------------------
Entertainment - 1.7%
Time Warner Inc. 4,200 292,688
-----------------------
-----------------------
Finance - Diversified - 5.0%
American Express 2,700 415,800
Marsh & McLennan 5,400 426,937
-----------------------
-----------------------
842,737
-----------------------
-----------------------
HEALTH - DIVERSIFIED - 5.5%
Bristol-Myers Squibb, Inc. 5,600 430,150
Johnson & Johnson, Inc. 2,712 284,082
Warner-Lambert, Inc. 2,600 207,512
-----------------------
-----------------------
921,744
-----------------------
-----------------------
HOUSEHOLD PRODUCTS - 4.1%
Black & Decker Corp 8,100 348,300
Procter & Gamble, Inc. 3,300 346,088
-----------------------
-----------------------
694,388
-----------------------
-----------------------
INDUSTRIAL MACHINERY & EQUIPMENT - 2.2%
Ingersoll-Rand Co. 7,100 370,975
-----------------------
-----------------------
Insurance - 3.2%
American International Group 5,202 535,481
-----------------------
-----------------------
Manufacturers - Diversified - 1.8%
Monsanto Co. 7,900 304,150
-----------------------
-----------------------
Medical Equipment & Supplies - 4.2%
Baxter International, Inc. 7,500 486,562
Stryker Corp. 3,600 222,300
-----------------------
-----------------------
708,862
-----------------------
-----------------------
OIL & GAS - 2.5%
Texaco, Inc. 7,000 429,625
-----------------------
-----------------------
GLOBALT GROWTH FUND
SCHEDULE OF INVESTMENTS - OCTOBER 31, 1999 - CONTINUED
COMMON STOCKS - CONTINUED SHARES VALUE
Paper & Forest Products - 1.4%
Avery Dennison Corp. 3,900 $ 243,750
-----------------------
-----------------------
Restaurants - 2.6%
McDonald's Corp. 10,600 437,250
-----------------------
-----------------------
TRUCKING & FREIGHT - 2.1%
FDX Corp. (a) 8,300 357,419
-----------------------
-----------------------
TOTAL COMMON STOCKS (COST $12,196,510) 16,015,075
-----------------------
-----------------------
PRINCIPAL
AMOUNT VALUE
Money Market Securities - 1.8%
Firstar Treasury Fund, 4.41% (b) (Cost $311,783) 311,783 311,783
-----------------------
-----------------------
TOTAL INVESTMENTS - (COST $12,508,293) - 96.4% 16,326,858
-----------------------
-----------------------
OTHER ASSETS LESS LIABILITIES - 3.6% 607,182
-----------------------
-----------------------
TOTAL NET ASSETS - 100.0% $ 16,934,040
=======================
=======================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at October
29, 1999.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
GLOBALT GROWTH FUND OCTOBER 31, 1999
Statement of Assets and Liabilities
ASSETS
Investment in securities, at value (cost $12,508,293) $ 16,326,858
Cash 217
Receivable for fund shares sold 1,000
Receivable for investment sold 614,349
Dividends receivable 6,705
Interest receivable 2,520
----------------------
TOTAL ASSETS 16,951,649
LIABILITIES
Accrued investment advisory fee payable $ 16,543
Payable for fund shares redeemed 1,066
-----------------------
TOTAL LIABILITIES 17,609
----------------------
NET ASSETS $ 16,934,040
======================
Net Assets consist of:
Paid in capital 12,274,610
Undistributed Net Investment Loss (2,886)
Accumulated undistributed net realized gain on investments 843,751
Net unrealized appreciation on investments 3,818,565
----------------------
NET ASSETS, for 866,952 shares $ 16,934,040
======================
NET ASSET VALUE
Net Assets
Offering price and redemption price per share ($16,934,040 / 866,952) $ 19.53
======================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GLOBALT GROWTH FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDED OCTOBER 31, 1999
<S> <C> <C>
INVESTMENT INCOME
Dividend Income $ 122,603
Interest Income 18,296
--------------------
TOTAL INCOME 140,899
EXPENSES
Investment advisory fee $ 183,642
Trustees' fees 1,377
--------------------
Total expenses before reimbursement 185,019
Reimbursed expenses (1,377)
--------------------
Total operating expenses 183,642
--------------------
NET INVESTMENT INCOME (LOSS) (42,743)
--------------------
REALIZED & UNREALIZED GAIN
Net realized gain on investment securities 844,362
Change in net unrealized appreciation (depreciation)
on investment securities 2,489,533
--------------------
Net gain on investment securities 3,333,895
--------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 3,291,152
====================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GLOBALT GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
<S> <C> <C>
YEAR YEAR
ENDED ENDED
OCTOBER 31, OCTOBER 31,
1999 1998
---------------------- -----------------------
Increase/(Decrease) in Net Assets
Operations
Net investment income (loss) $ (42,743) $ 14,740
Net realized gain on investment securities 844,362 687,055
Change in net unrealized
appreciation (depreciation) 2,489,533 496,228
---------------------- -----------------------
Net increase in net assets
resulting from operations 3,291,152 1,198,023
---------------------- -----------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (15,584) (5,420)
From net realized gain (592,834) (753,352)
---------------------- -----------------------
---------------------- -----------------------
Total distributions (608,418) (758,772)
---------------------- -----------------------
SHARE TRANSACTIONS
Net proceeds from sale of shares 4,333,512 3,441,709
Shares issued in reinvestment of distributions 608,118 758,704
Shares redeemed (2,399,432) (933,230)
---------------------- -----------------------
NET INCREASE IN NET ASSETS RESULTING
FROM SHARE TRANSACTIONS 2,542,198 3,267,183
---------------------- -----------------------
TOTAL INCREASE IN NET ASSETS 5,224,932 3,706,434
NET ASSETS
Beginning of period 11,709,108 8,002,674
---------------------- -----------------------
End of period [including accumulated
undistributed net investment income (loss)
of $(2,886) and $12,698, respectively] $ 16,934,040 $ 11,709,108
====================== =======================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GLOBALT GROWTH FUND
FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,
--------------------------------------------------------------------
--------------------------------------------------------------------
<S> <C> <C> <C> <C>
Period ended
October 31,
1999 1998 1997 1996 (A)
------------- ------------------ ------------------ ----------------
------------- ------------------ ------------------ ----------------
SELECTED PER SHARE DATA
Net asset value, beginning of period $ 16.14 $ 15.66 $ 12.48 $ 10.00
------------- ------------------ ------------------ ----------------
------------- ------------------ ------------------ ----------------
Income from investment operations:
Net investment income (loss) (0.05) 0.02 0.01 0.01
Net realized and unrealized gain 4.27 1.86 3.34 2.47
------------- ------------------ ------------------ ----------------
------------- ------------------ ------------------ ----------------
Total from investment operations 4.22 1.88 3.35 2.48
------------- ------------------ ------------------ ----------------
------------- ------------------ ------------------ ----------------
Less Distributions
From net investment income (0.02) (0.01) - -
From net realized gain (0.81) (1.39) (0.17) -
------------- ------------------ ------------------ ----------------
------------- ------------------ ------------------ ----------------
Total Distributions (0.83) (1.40) (0.17) -
------------- ------------------ ------------------ ----------------
------------- ------------------ ------------------ ----------------
Net asset value, end of period $ 19.53 $ 16.14 $ 15.66 $ 12.48
============= ================== ================== ================
============= ================== ================== ================
TOTAL RETURN (b) 26.67% 13.28% 27.15% 24.80%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000) $16,934 $11,709 $8,003 $3,443
Ratio of expenses to average net assets 1.17% 1.17% 1.17% 1.16% (c)
Ratio of expenses to average net assets
before reimbursement 1.18% 1.19% 1.19% 1.25% (c)
Ratio of net investment income (loss) to
average net assets (0.27)% 0.14% 0.06% 0.11% (c)
Ratio of net investment income (loss) to
average net assets before reimbursement (0.28)% 0.12% 0.04% 0.02% (c)
Portfolio turnover rate 120.46% 83.78% 110.01% 66.42% (c)
</TABLE>
(a) December 1, 1995 (commencement of operations) to October 31, 1996
(b) For periods of less than a full year, total returns are not annualized.
(c) Annualized
<PAGE>
GLOBALT Growth Fund
Notes to Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
GLOBALT Growth Fund (the "Fund") is organized as a series of the AmeriPrime
Funds, an Ohio business trust (the "Trust). The Fund is registered under the
Investment Company Act of 1940, as amended, as a diversified series, open-end
management investment company. The Fund's investment objective is to provide
long term growth of capital. The Trust Agreement permits the Trustees to issue
an unlimited number of shares of beneficial interest of separate series without
par value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuation- Securities which are traded on any exchange or on the
NASDAQ over-the-counter market are valued at the last quoted sale price. Lacking
a last sale price, a security is valued at its last bid price except when, in
the Advisor's opinion the last bid price does not accurately reflect the current
value of the security. All other securities for which over-the-counter market
quotations are readily available are valued at their last bid price. When market
quotations are not readily available, and the Advisor determines the last bid
price does not accurately reflect the current value or when restricted
securities are being valued, such securities are valued as determined in good
faith by the Advisor, in conformity with guidelines adopted by and subject to
review of the Board of Trustees of the Trust (the "Board").
Fixed-income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Advisor,
subject to review of the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
GLOBALT Growth Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes- The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains.
Dividends and Distributions- The Fund intends to comply with federal tax rules
regarding distribution of substantially all of its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year.
Other- The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains GLOBALT, Inc. (the "Advisor") to manage the Fund's
investments. The advisor was organized as a Georgia corporation in 1990. Angela
Allen, President of the Advisor, and Samuel Allen, Chairman of the Advisor, are
the controlling shareholders of GLOBALT, Inc. The investment decisions for the
Fund are made by a committee of the Advisor, which is primarily responsible for
the day-to-day management of the Fund's portfolio.
Under the terms of the management agreement (the "Agreement"), the Advisor
manages the Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of the Fund except brokerage commissions, taxes,
interest, fees and expenses of non-interested person trustees, and extraordinary
expenses. As compensation for its management services and agreement to pay the
Fund's expenses, the Fund is obligated to pay the Advisor a fee computed and
accrued daily and paid monthly at an annual rate of 1.17% of the average daily
net assets of the Fund. It should be noted that most investment companies pay
their own operating expenses directly, while the Fund's expenses, except those
specified above, are paid by the Advisor. For the year ended October 31, 1999,
the Advisor received a fee of $183,642 from the Fund. The Advisor has
voluntarily agreed to reimburse other expenses for the fiscal year ended October
31, 1999 to the extent necessary to maintain total expenses at the rate of
1.17%. For the year ended October 31, 1999, the Advisor reimbursed expenses of
$1,377. There is no assurance that such reimbursement will continue in the
future.
GLOBALT Growth Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the funds business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment and
personnel. For the year ended October 31, 1999, the Administrator received fees
of $30,000 from the Advisor for administrative services provided to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. ("the Distributor")
to act as the principal distributor of the Fund's shares. There were no payments
made to the Distributor for the year ended October 31, 1999. Certain members of
management of the Administrator and the Distributor are also members of
management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, there was an unlimited number of authorized shares
for the Fund. Paid in capital at October 31, 1999 was $12,274,610.
Transactions in shares were as follows:
<TABLE>
- --------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year ended Year ended
October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
Shares Dollars Shares Dollars
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 237,096 $4,333,512 216,459 $3,441,709
- -------------------------------------------------------------------------------------------------------------------------
Shares issued in reinvestment of dividends
34,260 608,118 53,733 758,704
- -------------------------------------------------------------------------------------------------------------------------
Shares redeemed
(130,011) (2,399,432) (55,461) (933,230)
- -------------------------------------------------------------------------------------------------------------------------
141,345 $2,542,198 214,731 $3,267,183
- -------------------------------------------------------------------------------------------------------------------------
====== ======== ====== ========
</TABLE>
GLOBALT Growth Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 5. INVESTMENTS
For the year ended October 31, 1999, purchases and sales of investment
securities, other than short-term investments, aggregated $20,132,200 and
$18,159,591, respectively. The gross unrealized appreciation for all securities
totaled $4,020,656 and the gross unrealized depreciation for all securities
totaled $202,091 for a net unrealized appreciation of $3,818,565. The aggregate
cost of securities for federal income tax purposes at October 31, 1999 was
$12,508,293.
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 8. RECLASSIFICATIONS
In accordance with SOP 93-2, the fund has recorded a reclassification in
the capital accounts. As of October 31, 1999, the fund recorded permanent
book/tax differences of $42,743 from net investment loss to paid in capital.
This reclassification has no impact on the net asset value of the fund and is
designed generally to present undistributed income and realized gains on a tax
basis which is considered to be more informative to shareholders.
<PAGE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
GLOBALT Growth Fund
We have audited the accompanying statement of assets and liabilities of the
GLOBALT Growth Fund, including the schedule of portfolio investments, as of
October 31, 1999, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and financial highlights for each of the periods indicated.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
GLOBALT Growth Fund as of October 31, 1999, the results of its operations for
the year then ended, the changes in its net assets for each of the two years in
the period then ended, and the financial highlights for each of the periods
indicated, in conformity with generally accepted accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
<PAGE>
November 15, 1999
Dear Shareholder:
This certainly has been a tiring year, but an exciting one in many cases. Since
October 31st of 1998, your Fund has enjoyed the joys of security ownership, as
well as some of the perils. Nevertheless, owning the small stocks that
characterize our portfolio has not proven as worthwhile as owning the large
technology and financial services stocks that have dominated investor attention
for so long. However, in my opinion, the Corbin Small-Cap Value Fund stands
well-positioned to produce dramatic results when the market's eye turns toward
smaller stocks. That is why I believe that every investor should have a
substantial amount of his or her funds in this area of the marketplace.
The last few weeks, I have talked to a couple of old friends of mine, asking
them their opinions about what they saw going on in the marketplace. One of them
is one of the most brilliant analysts I know. He is a unique character in that
he spends most of his time finding what not to like, and then "shorting" it.
Besides providing some of America's largest money managers his insights (at
$10,000 a year), he also runs one of the few funds devoted to shorting stocks. I
never underestimate his analytical ability; usually, only his timing is in
question. It is currently his belief that the most massive problem plaguing the
U.S. economy is that the capital allocation process has been completely out of
any realm of reason. To illustrate the point, look at the recent success the
initial public offering of Akami Technologies (AKAM) had in the marketplace.
Most investors have never heard of Akami, which sells a product that pulls up
Web pages faster. The fourteen-month-old company had no revenues in 1998 and
$1.3 million in the first nine months of 1999. Yet, as I write this, Akami has a
market value in excess of $14 billion, about $2 billion more than Apple
Computer. The firm was started by a professor on sabbatical and his graduate
assistant, both of whom are now worth over $1.5 billion. Clearly, it does not
take a genius of my friend's stature to figure out that there is something
wrong. Yet, it does take some study of investor behavior to see that the process
of ferreting out the best return on an investment in a company has become
totally disconnected from company performance. If this is true, and I have every
reason to believe it is, it clearly has more profound implications for the U.S.
economy than a similar situation in Japanese real estate and stocks did for
Japanese investors. That is because Japanese problems remained primarily
Japanese problems, and because the transmittal of information is substantially
faster today than in the past.
My other friend that provided insight into the current market situation is the
manager of a major value fund. He is one of the smartest guys in America, having
compiled an unbelievable record through 1997. Then, like for many value
managers, 1998 and 1999 have proved challenging. It was interesting to get the
perspective of someone who has managed money since the late 1960s and who had
seen the "Go-Go" days of the early 1970s, as well as the 1973-74 bust. He
indicated that the current market cycle had extended itself for three main
reasons. First, the government's anti-trust regulation has been virtually
non-existent, which allowed unchecked merging between large companies, exciting
Wall Street. Second, the Asian Crisis has provided relief from price pressure in
many key areas, while helping to lower interest rates worldwide. This has helped
to extend the business cycle. Third, small companies have generally not had the
same level of activity by the board of directors as by the directors at large
companies. This has had the effect of not pushing management as hard to improve
results when companies have stumbled.
<PAGE>
I agree with all points made by these gentlemen, but also have a few of my own,
namely the feeding frenzy on the part of investors for Internet-related issues,
and the P/E ratios people are willing to pay. As I have talked to CEOs around
the country, clearly there is "a giant sucking sound" as everyone tries to jump
on the Internet bandwagon. If you do not have some Net strategy, investors do
not show any interest in your firm. We believe that this will eventually lead to
grueling competition, with unforeseen consequences for most investors. Our
businesses in the Fund are well-equipped to deliver substantial financial
results because of their ability to use technology for their benefit. Generally,
most of our businesses have solid niches in their markets in which they either
dominate or are major competitors. Over the long-term, this should lead to
enhanced corporate profits, and a higher stock price. Later on, I will highlight
some of these companies.
What do I foresee in the next year for the Fund? Starting in calendar 2000, I
believe that we could see one of the greatest years in the history of the
small-cap marketplace. The technology that investors have felt was only
available to large companies should be used by small firms to begin to
outperform their large-cap brethren. The snapback in the Asian, Latin American,
and European economies should provide stronger markets for U.S. goods. Interest
rates should remain near current levels for the next year, and investors should
focus more closely on valuation. The other key factor that should continue to be
a big part of the investment landscape is mergers/acquisitions. Mergers and
acquisitions advanced many of the stock prices of the companies in the Fund, and
this trend should continue into this next year.
PERFORMANCE REVIEW
For the year ended October 31, 1999, the Corbin Small-Cap Value Fund returned
1.96% and the Russell 2000 and S&P 600 Small-Cap were at 14.55% and 12.02%,
respectively. The first two months of the Fund's year was a "killer" time
period, as the problems with securities such as Aames Financial continued to
plague the Fund. Yet, it was out of these situations that some of our strongest
ideas were produced, as well as giving us the chance to add to some other
positions at advantageous prices.
For those of you who are investing in this fund with taxable money, I should
mention that the Fund has a large loss carry-forward that can be used to shelter
future gains. This means that as smaller stocks recover and are sold at a
profit, you would not receive a taxable distribution until all of the carry
forwards are exhausted. This should result in a significant tax savings for
investors.
Returns for the Year Ended October 31, 1999
- -----------------------------------------------------------------------------
Fund/Index 1 Year Average Annual Return
Since Inception
June 30, 1997
- -----------------------------------------------------------------------------
Corbin Small-Cap Fund 1.96% -13.15%
S&P 600 12.02% 4.47%
Russell 2000 14.55% 4.76%
- -----------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
Corbin - $7,189 S&P 600 - $11,075 Russell 2000 - $11,056
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
6/30/97 10,000 10,000 10,000
7/31/97 10,310 10,629 10,467
8/31/97 10,520 10,897 10,703
9/30/97 11,330 11,617 11,485
10/31/97 11,030 11,116 10,975
11/30/97 11,209 11,035 10,900
12/31/97 10,916 11,257 11,095
1/31/98 10,575 11,037 10,926
2/28/98 10,853 12,043 11,746
3/31/98 11,257 12,503 12,239
4/30/98 11,171 12,577 12,306
5/30/98 10,617 11,910 11,646
6/30/98 10,511 11,945 11,680
7/31/98 9,595 11,031 10,726
8/31/98 7,401 8,905 8,646
9/30/98 7,187 9,448 9,272
10/31/98 7,049 9,887 9,652
11/30/98 6,378 10,443 10,162
12/31/98 6,750 11,109 10,810
1/31/99 6,590 10,969 10,950
2/28/99 6,111 9,981 9,963
3/31/99 5,951 10,109 10,092
4/30/99 7,122 10,777 10,758
5/31/99 7,602 11,038 11,019
6/30/99 7,719 11,667 11,646
7/31/99 7,879 11,564 11,544
8/31/99 7,336 11,055 11,036
9/30/99 7,421 11,103 11,083
10/31/99 7,189 11,075 11,056
</TABLE>
The chart shows the value of a hypothetical initial investment of $10,000 in the
Fund, the S&P 600 Index and the Russell 2000 Index on June 30, 1997 and held
through October 31, 1999. The S&P 600 Index and the Russell 2000 Index are
widely recognized unmanaged indices of common stock prices. Performance figures
include the change in value of the stocks in the indices and reinvestment of
dividends, and are not annualized. The index returns do not reflect expenses,
which have been deducted from the Fund's return. THE FUND'S RETURN REPRESENTS
PAST PERFORMANCE AND IS NOT PREDICTIVE OF FUTURE RESULTS.
FIVE STOCKS TO WATCH
There are a number of securities that we feel have very good appreciation
potential in the next year and that we would like to highlight in our annual
report. These are the Fund's largest concentrations, and should continue to be,
going forward.
Titan Corporation - The company is primarily in the defense business but has
three rapid-growth subsidiaries that are outgrowths of its primary business. The
first, Cayenta.com, is an information technology company. The second, Surebeam,
is in the food sterilization business. The third, Titan Technologies, is in the
mobile telecom business. We believe that eventually the fast-growth subsidiaries
will be spun off to shareholders, unlocking value. The defense business should
continue its steady growth, making acquisitions and building value in a
consolidating industry.
Successories, Inc. - The company is a leader in the motivational and
people-recognition business. Currently, the company is in the process of
divesting itself of its retailing assets, which it will use to clean up its
balance sheet. Jack Miller, the well-known Chicago catalog entrepreneur, has
just purchased a stake in the company and has been named chairman of the board.
The company has high-margin products and an improving financial position, which
when coupled with sales growth could yield spectacular profitability.
Pizza Inn - This franchiser of restaurants continues to repurchase its own
shares, while paying a very good dividend. The company now has over 500 stores
worldwide and is showing improving margins, coupled with sales growth.
<PAGE>
FIVE STOCKS TO WATCH - continued
Cyberonics - The company makes a device that controls the electrical impulses in
the brain that cause epileptic seizures. It is currently in the process of
showing that its products may cure chronic depression, as well as obesity. Since
the market for these last two applications is substantially larger than for the
nascent seizure market, the company could reap huge profits from its products.
Duckwall-Alco - Duckwall operates general merchandise stores in Midwestern and
Southwestern towns with under 20,000 people. The company is currently trading at
a very cheap valuation, is repurchasing shares, and is looking for other ways to
enhance shareholder value.
CONCLUSION
The Fund has now been in existence for thirty months. During a large portion of
that time, it matched or even exceeded the relevant market averages. The period
from June 30th 1998 to December 31st 1998 was one that I would rather not
repeat, for Fund holders or myself. With that said, I believe that great days
are ahead of us for numerous reasons. Probably the most important is the belief
that good people working hard will achieve superior results over the long-term.
That is what our investment advisory firm is all about.
I have mentioned previously that my liquid investment net worth is in this Fund,
which is still the case. If you know of someone who would like information on
the Fund, please do not hesitate to call us at (800) 924-6848.
Finally, if you ever have any questions or comments about the Fund, please let
me know. My name is the one over the door, and I will do what it takes to make
this a successful experience for all shareholders. If you would like to reach
me, please e-mail me at [email protected], call the above number, or send a
letter to our office in Fort Worth.
Once again, I thank you for your faith in our efforts, and all of us are working
hard to make sure it is rewarded.
Sincerely,
David A. Corbin, CFA
President & Chief
Investment Officer
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the Fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Corbin Small-Cap Value Fund
Schedule of Investments - October 31, 1999
<S> <C> <C>
Common Stocks - 95.3% Shares Value
BASIC INDUSTRIES- 9.7%
Iron & Steel - 2.8%
Quanex Corp. 3,000 $ 65,062
-----------------
-----------------
Manufacturers - Diversified - 2.3%
Griffon Corp. (a) 7,000 51,625
-----------------
-----------------
Metals & Mining - 1.6%
RTI International Metals (a) 5,000 36,250
-----------------
-----------------
Paper & Forest Products - 3.0%
Republic Group 4,000 69,000
-----------------
-----------------
TOTAL BASIC INDUSTRY 221,937
-----------------
-----------------
CONSTRUCTION & REAL ESTATE - 2.8%
Engineering - 2.8%
Butler Mfg. 2,600 64,188
-----------------
-----------------
DURABLES - 4.8%
Autos & Auto Parts - 4.8%
Bonded Motors Inc. (a) 27,200 34,000
Wabash National Corp. 4,715 74,851
-----------------
-----------------
108,851
-----------------
-----------------
ENERGY - 2.1%
Oil & Gas - 2.1%
Unifab International (a) 7,000 47,250
-----------------
-----------------
FINANCE - 8.8%
Banks - 4.9%
First Financial Bankshares 1,800 61,200
Independent Bankshares 3,700 52,262
-----------------
-----------------
113,462
-----------------
-----------------
Credit & Other Finance - 3.9%
Onyx Acceptance (a) 13,000 89,375
-----------------
-----------------
TOTAL FINANCE 202,837
-----------------
-----------------
HEALTH - 6.1%
Medical Equipment & Supplies - 6.1%
Cyberonics Inc (a) 10,000 140,625
-----------------
-----------------
Corbin Small-Cap Value Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
MEDIA & LEISURE - 14.6%
Publishing - 3.4%
Thomas Nelson, Inc. 8,000 $ 77,000
-----------------
-----------------
Restaurants - 11.2%
CKE Restaurants 10,400 70,200
Lone Star Steakhouse/Saloon (a) 8,030 64,240
Pizza Inn 31,000 124,000
-----------------
-----------------
258,440
-----------------
-----------------
TOTAL MEDIA & LEISURE 335,440
-----------------
-----------------
NON-DURABLES - 3.3%
Beverages - 3.3%
Lancer Corp. (a) 14,900 75,431
-----------------
-----------------
RETAIL & WHOLESALE - 21.1%
General Merchandise Stores - 4.3%
Duckwall-Alco Stores (a) 12,000 97,500
-----------------
-----------------
Grocery Stores - 1.1%
Ingles Markets - Class A 2,000 25,875
-----------------
-----------------
Specialty - 15.7%
Rush Enterprises (a) 3,500 52,062
Successories, Inc. (a) 115,000 309,063
-----------------
-----------------
361,125
-----------------
-----------------
TOTAL RETAIL & WHOLESALE 484,500
-----------------
-----------------
TECHNOLOGY - 20.8%
Communications Equipment - 3.9%
Vtel Corp. (a) 29,500 90,344
-----------------
-----------------
Computer Services & Software - 14.0%
Carreker-Antinori, Inc. (a) 10,000 68,750
Titan Corp. (a) 15,000 251,250
-----------------
-----------------
320,000
-----------------
-----------------
Electronic Instruments - 2.9%
Herley Industries (a) 5,500 67,031
-----------------
-----------------
TOTAL TECHNOLOGY 477,375
-----------------
-----------------
Corbin Small-Cap Value Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
TRANSPORTATION - 1.2%
Railroads - 1.2%
RailTex, Inc. (a) 1,700 $ 27,200
-----------------
-----------------
TOTAL COMMON STOCKS (Cost $2,412,776) 2,185,634
-----------------
-----------------
Principal
Money Market Securities - 6.8% Amount Value
Firstar Treasury Fund, 4.41% (b) (Cost $156,709) 156,709 156,709
-----------------
-----------------
TOTAL INVESTMENTS - 102.1% (Cost $2,569,485) 2,342,343
-----------------
-----------------
Other Assets less Liabilities - (2.1%) (48,054)
-----------------
-----------------
Total Net Assets - 100.0% $ 2,294,289
=================
=================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at October
29, 1999.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Corbin Small-Cap Value Fund October 31, 1999
Statement of Assets & Liabilities
Assets
Investment in securities, at value (cost $2,569,485) $ 2,342,343
Cash 10,360
Receivable for fund shares sold 400
Dividends receivable 320
Interest receivable 451
-------------------
Total assets 2,353,874
Liabilities
Accrued investment advisory fee payable $ 2,485
Payable for securities purchased 35,688
Payable for fund shares redeemed 21,412
------------------
Total liabilities 59,585
-------------------
Net Assets $ 2,294,289
===================
Net Assets consist of:
Paid in capital $ 3,375,218
Undistributed Net Investment Loss (1,444)
Accumulated net realized gain (loss) on investments (852,343)
Net unrealized appreciation (depreciation) on investments (227,142)
-------------------
Net Assets, for 340,113 shares $ 2,294,289
===================
Net Asset Value
Net Assets
Offering price and redemption price per share ($2,294,289 / 340,113) $ 6.75
===================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Corbin Small-Cap Value Fund
Statement of Operations for the year ended October 31, 1999
<S> <C> <C>
Investment Income
Dividend Income $ 11,350
Interest Income 13,095
---------------
Total Income 24,445
Expenses
Investment advisory fee $ 29,043
Trustees' fees 1,377
---------------
Total expenses before reimbursement 30,420
Reimbursed expenses (1,377)
---------------
Total operating expenses 29,043
---------------
Net Investment Income (Loss) (4,598)
---------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities (300,255)
Change in net unrealized appreciation (depreciation)
on investment securities 327,949
---------------
Net gain on investment securities 27,694
---------------
Net increase in net assets resulting from operations $ 23,096
===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Corbin Small-Cap Value Fund
Statement of Changes in Net Assets
<S> <C> <C>
Year Year
ended ended
October 31, October 31,
1999 1998
------------------- -------------------
Increase/(Decrease) in Net Assets
Operations
Net investment income (loss) $ (4,598) $ (3,050)
Net realized gain (loss) on investment securities (300,255) (467,038)
Change in net unrealized appreciation (depreciation) 327,949 (599,782)
------------------- -------------------
Net increase (decrease) in net assets resulting from operations 23,096 (1,069,870)
------------------- -------------------
Distributions to shareholders
From net investment income - (1,444)
From net realized gain - (90,963)
------------------- -------------------
Total distributions - (92,407)
------------------- -------------------
Share Transactions
Net proceeds from sale of shares 747,375 2,309,098
Shares issued in reinvestment of distributions - 86,814
Shares redeemed (765,186) (279,062)
------------------- -------------------
Net increase in net assets resulting
from share transactions (17,811) 2,116,850
------------------- -------------------
Total increase in net assets 5,285 954,573
Net Assets
Beginning of period 2,289,004 1,334,431
------------------- -------------------
End of period [including accumulated net investment loss
of $1,444 and $1,444, respectively] $ 2,294,289 $ 2,289,004
=================== ===================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Corbin Small-Cap Value Fund
Financial Highlights
<S> <C> <C> <C>
Year Year Period
ended ended ended
October 31, October 31, October 31,
1999 1998 1997 (a)
---------------- ---------------- ----------------
Selected Per Share Data
Net asset value, beginning of period $ 6.62 $ 11.03 $ 10.00
---------------- ---------------- ----------------
Income from investment operations
Net investment income (loss) (0.01) (0.01) -
Net realized and unrealized gain (loss) 0.14 (3.76) 1.03
---------------- ---------------- ----------------
Total from investment operations 0.13 (3.77) 1.03
---------------- ---------------- ----------------
Less Distributions
From net investment income - (0.01) -
From net realized gain - (0.63) -
---------------- ----------------
---------------- ----------------
Total distributions - (0.64) -
---------------- ---------------- ----------------
Net asset value, end of period $ 6.75 $ 6.62 $ 11.03
================ ================ ================
Total Return (b) 1.96% (36.07)% 10.30%
Ratios and Supplemental Data
Net assets, end of period (000) $2,294 $2,289 $1,334
Ratio of expenses to average net assets 1.25% 1.25% 1.23% (c)
Ratio of expenses to average net assets
before reimbursement 1.31% 1.30% 1.23% (c)
Ratio of net investment income (loss) to
average net assets (0.20)% (0.15)% 0.00%
Ratio of net investment income (loss) to
average net assets before reimbursement (0.26)% (0.20)% 0.00%
Portfolio turnover rate 65.66% 86.42% 20.41% (c)
(a) June 30, 1997 (commencement of operations) to October 31, 1997
(b) For periods of less than a full year, total returns are not annualized.
(c) Annualized
</TABLE>
<PAGE>
Corbin Small-Cap Value Fund
Notes to Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
The Corbin Small-Cap Value Fund (the "Fund") is organized as a series of
the AmeriPrime Funds, an Ohio business trust (the "Trust"). The Fund is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. The investment objective of
the Fund is to provide long term capital appreciation to its shareholders. The
Declaration of Trust permits the trustees to issue an unlimited number of shares
of beneficial interest of separate series without par value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuation - Securities which are traded on any exchange or on the
NASDAQ over-the-counter market are valued at the last quoted sale price. Lacking
a last sale price, a security is valued at its last bid price except when, in
the Advisor's opinion, the last bid price does not accurately reflect the
current value of the security. All other securities for which over-the-counter
market quotations are readily available are valued at their last bid price. When
market quotations are not readily available, and the Advisor determines the last
bid price does not accurately reflect the current value or when restricted
securities are being valued, such securities are valued as determined in good
faith by the Advisor, in conformity with guidelines adopted by and subject to
review of the Board of Trustees of the Trust (the "Board").
Fixed-income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market values of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Advisor,
subject to review of the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
Corbin Small-Cap Value Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes - The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains. Loss carryforwards total $852,343 as of October 31,
1999: $300,255 expiring in 2007, and $552,088 expiring in 2006.
Dividends and Distributions - The Fund intends to comply with federal tax rules
regarding distribution of substantially all of its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year.
Other - The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Corbin & Company (the "Advisor") to manage the Fund's
investments. David A. Corbin, President of the Advisor, is primarily responsible
for the day to day management of the Fund's portfolio.
Under the terms of the management agreement (the "Agreement"), the Advisor
manages the Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of the Fund except brokerage commissions, taxes,
interest, fees and expenses of the non-interested person trustees, and
extraordinary expenses. As compensation for its management services and
agreement to pay the Fund's expenses, the Fund is obligated to pay the Advisor a
fee computed and accrued daily and paid monthly at an annual rate of 1.25% of
the average daily net assets of the Fund. It should be noted that most
investment companies pay their own operating expenses directly, while the Fund's
expenses, except those specified above, are paid by the Advisor. For the year
ended October 31, 1999, the Advisor has received a fee of $29,043 from the Fund.
The Advisor has voluntarily agreed to reimburse other expenses for the fiscal
year ended October 31, 1999, to the extent necessary to maintain total operating
expenses at the rate of 1.25%. For the year ended October 31, 1999, the Advisor
reimbursed expenses of $1,377. There is no assurance that such reimbursement
will continue in the future.
Corbin Small-Cap Value Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Fund's business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment and
personnel. For the year ended October 31, 1999, the Administrator received fees
of $17,500 from the Advisor for administrative services provided to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. (the "Distributor")
to act as the principal distributor of the Fund's shares. There were no payments
made to the Distributor for the year ended October 31, 1999. Certain members of
management of the Administrator and the Distributor are also members of
management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, there was an unlimited number of authorized shares
for the Fund. Paid in capital at October 31, 1999 was $3,375,218.
Transactions in shares were as follows:
<TABLE>
- --------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year ended Year ended
October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares Dollars Shares Dollars
- --------------------------------------------------------------------------------------------------------------------
Shares sold 114,423 $747,375 248,212 $2,309,098
- --------------------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of dividends - - 8,831 86,814
- --------------------------------------------------------------------------------------------------------------------
Shares redeemed
(120,150) (765,186) (32,184) (279,062)
- --------------------------------------------------------------------------------------------------------------------
(5,727) $(17,811) 224,859 $2,116,850
- --------------------------------------------------------------------------------------------------------------------
====== ======= ====== =======
</TABLE>
Corbin Small-Cap Value Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 5. INVESTMENTS
For the year ended October 31, 1999, purchases and sales of investment
securities, other than short-term investments, aggregated $1,384,050 and
$1,345,159, respectively. The gross unrealized appreciation for all securities
totaled $288,807 and the gross unrealized depreciation for all securities
totaled $515,949 for a net unrealized depreciation of $227,142. The aggregate
cost of securities for federal income tax purposes at October 31, 1999 was
$2,569,485.
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 7. RELATED PARTY TRANSACTIONS
The Advisor is not a registered broker-dealer of securities and thus does
not receive commissions on trades made on behalf of the Fund. The beneficial
ownership, either directly or indirectly, of more than 25% of the voting
securities of a Fund creates a presumption of control of the Fund, under Section
2(a)(9) of the Investment Company Act of 1940. As of October 31, 1999, Charles
Schwab & Co. owned of record in aggregate more than 43% of the Fund.
NOTE 8. RECLASSIFICATIONS
In accordance with SOP 93-2, the Fund has recorded a reclassification in
the capital accounts. As of October 31, 1999, the Fund recorded permanent
book/tax differences of $4,598 from net investment loss to paid in capital. This
reclassification has no impact on the net asset value of the Fund and is
designed generally to present undistributed income and realized gains on a tax
basis which is considered to be more informative to shareholders.
<PAGE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
Corbin Small-Cap Value Fund
We have audited the accompanying statement of assets and liabilities of the
Corbin Small-Cap Value Fund, including the schedule of portfolio investments, as
of October 31, 1999, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and financial highlights for each of the periods indicated.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Corbin Small-Cap Value Fund as of October 31, 1999, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each of
the periods indicated, in conformity with generally accepted accounting
principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
<PAGE>
December 21, 1999
Dear Shareholders:
After an exceptionally strong start to our year, the summer proved once again to
be a difficult one for the stock market. Despite the fact that most of our
companies have continued to deliver solid earnings, nervous investors once again
panicked and sold stocks during August and September, especially in the
financial sector.
Results
The Marathon Value Fund's fiscal year ended on October 31, 1999. During the last
six months the Fund was up 3.94%, while the Russell 2000 was down 0.27%. For the
last twelve months the fund was up 9.04%, while the Russell 2000 was up 14.94%.
Comparative results since inceptions are shown below.
Returns for the Period Ended 10/31/99
----------------- ----------- -----------------------------
Fund/Index 1 Year Average Annual Return Since
Inception
----------------- ----------- -----------------------------
----------------- ----------- -----------------------------
Marathon Value 9.04% -4.66%
Fund
----------------- ----------- -----------------------------
----------------- ----------- -----------------------------
Russell 2000 14.94% -4.35%
----------------- ----------- -----------------------------
Date Russell 2000 MVF
3/9/98 $ 10,000.00 $ 10,000.00
3/31/98 $ 10,424.18 $ 10,050.00
4/30/98 $ 10,472.11 $ 10,320.00
5/31/98 $ 9,902.41 $ 9,920.00
6/30/98 $ 9,919.11 $ 9,510.00
7/31/98 $ 9,102.84 $ 8,800.00
8/31/98 $ 7,328.89 $ 7,310.00
9/30/98 $ 7,884.93 $ 7,630.00
10/30/98 $ 8,201 $ 8,480
11/30/98 $ 8,626 $ 8,790
12/30/98 $ 9,151 $ 8,970
1/30/99 $ 9,265 $ 8,850
2/28/99 $ 8,507 $ 8,410
3/30/99 $ 8,623 $ 8,470
4/30/99 $ 9,386 $ 8,880
5/30/99 $ 9,513 $ 9,200
6/30/99 $ 9,925 $ 9,640
7/30/99 $ 9,645 $ 9,380
8/30/99 $ 9,278 $ 9,030
9/30/99 $ 9,267 $ 8,810
10/30/99 $ 9,296 $ 9,230
The chart shows the value of a hypothetical initial investment of $10,000 in the
Fund, the Russell 2000 Index on March 12, 1998 and held through October 31,
1999. The Russell 2000 Index is widely recognized unmanaged indices of common
stock prices. Performance figures include the change in value of the stocks in
the indices, reinvestment of dividends, and are not annualized. The index
returns do not reflect expenses, which have been deducted from the Fund's
return. The Fund's return represents past performance and is not predictive of
future results.
Portfolio's Largest Positions
As of October 31, we were 88.5% invested in stocks and 11.5% in cash. At period
end our five largest holdings consisted of the following:
Dress Barn operates a national chain of value-priced specialty
stores offering fashion apparel to working women.
Computer Sciences Corporation provides information technology services
to commercial and government markets.
CSG Systems International provides customer care and billing
solutions for cable providers, on-line service markets, and
telephony providers.
Pepsico, Inc operates world-wide soft drink, juice, and snack food
businesses. Products include Pepsi Cola, Slice, Tropicana Pure
Premium, as well as snack foods such as Lay's potato chips,
Doritos and Rold Gold pretzels.
MCI Worldcom, Inc. provides consumers and businesses with local, long-
distance, Internet, data, and international communications
services.
Investment Outlook
The third-quarter earnings reports have been coming in strongly. With the yield
curve steepening in anticipation of another Fed rate hike, it seems that the
markets are well positioned for a rotation back to a more valuation-sensitive
approach.
One wild card is the Y2K phenomenon. While we have recently heard companies
blaming earnings weakness on Y2K, it has not been as wide spread as many
expected. We are closely tracking investor perceptions and popular thought. If
enough people become concerned - regardless of whether the concerns have any
rational basis - the concerns themselves can cause significant short-term
dislocations in the markets. Thus far, it seems the markets, while increasingly
fickle, have been willing to attribute news of such Y2K weakness to the specific
companies reporting it, as opposed to a "broad-brushed approach." If such is not
the case, investors may gravitate back toward the large growth stocks without
regard to valuation. We will monitor these actions closely and adjust tactically
if the situation warrants.
We have been selectively buying shares in finance, healthcare and technology
stocks when these fears grow. Especially as of late, the stocks we have been
buying have target prices 30-50% higher over the next twelve to eighteen months.
On the other side, we will be willing to part with shares when investors become
overly optimistic and drive share prices back through their fair values.
It is times like this that remind us that stock investing is a long-term
process. In order to enjoy returns greater than you would get in a money market
fund or a certificate of deposit, you have to be willing to live with the
volatility. We remain convinced that market timing will not work and are
confident that purchasing the stocks of solid, growing companies at attractive
valuations will continue to provide good returns over reasonable time periods.
Summary
Both in my personal life and at work, I am amazed at how fast change is
occurring. My daughters are growing up much more rapidly than I think they
should, and the investment world is changing at a pace never before seen.
Companies that may not have even existed two years ago are being valued in the
billions of dollars, and the speed of information flow is overwhelming at times.
The increasing complexity is also causing us to make rapid changes. In the last
year and a half we have added three new people and have taken a more pro-active
approach to searching out new investment ideas for the fund. The stocks you are
seeing in the fund like CSG Systems, Transaction Systems Architects and BMC
Software may not be as familiar as Disney, Gillette or General Motors, but we
believe the profit potential is something to be excited about.
We continue to avoid buying stocks values in the billions that could
theoretically make money some day. A good example of this is a company called
Webvan. This company recently went public and was valued at over $8 billion. The
company has revenues of $11.9 million and while it hopes to have revenues of
$500 million in 2001, it also expects to lose over $300 million in that same
year. We believe that we will make significantly more money investing in
Albertson's. Albertson's is valued at a little over $14 billion and expects to
make a profit after tax next year of over $1.2 billion. While we acknowledge
that Internet grocers will have some impact on traditional grocers, we prefer to
invest in the company that has shown increasing revenues and profits for the
last 29 years, than "invest" in an Internet grocer that is projecting a loss of
$300 million two years down the road.
While quarter-to-quarter and annual results will vary, we will continue to
uncover value opportunities often overlooked by other investors. Successful
investing in today's busy world takes time and patience. We have the experience
necessary to make it work for our shareholders.
Sincerely,
Mark Matsko, CFA
Portfolio Manager
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
<PAGE>
<TABLE>
<CAPTION>
Marathon Value Fund
Schedule of Investments - October 31, 1999
<S> <C> <C>
Common Stocks - 89.1% Shares Value
BASIC INDUSTRIES - 6.2%
Manufacturers - Diversified - 4.7%
Teleflex, Inc. 2,400 $ 81,750
Tyco International, Inc. 2,750 109,828
-------------------
-------------------
191,578
-------------------
-------------------
Paper & Forest Products - 1.5%
T J International Inc. 2,000 62,000
-------------------
-------------------
TOTAL BASIC INDUSTRIES 253,578
-------------------
-------------------
CONSTRUCTION & REAL ESTATE - 3.8%
Building Materials - 2.1%
Masco Corp. 2,800 85,400
-------------------
-------------------
Construction - 1.7%
Clayton Homes, Inc. 7,000 70,875
-------------------
-------------------
TOTAL CONSTRUCTION & REAL ESTATE 156,275
-------------------
-------------------
DURABLES - 0.5%
Consumer Durables - 0.5%
Helen of Troy Ltd. (b) 2,500 22,344
-------------------
-------------------
ENERGY - 3.5%
Oil & Gas- 3.5%
Anadarko Petroleum, Inc. 3,300 101,681
Texaco, Inc. 700 42,963
-------------------
-------------------
144,644
-------------------
-------------------
FINANCE - 14.0%
Banks - 7.6%
Bank of America Corp. 1,900 122,313
Chase Manhattan, Inc. 1,000 87,375
Citigroup, Inc. 1,900 102,837
-------------------
-------------------
312,525
-------------------
-------------------
Federal Sponsored Credit - 2.2%
Federal National Mortgages 1,300 91,975
-------------------
-------------------
Investment Company - 2.6%
Bear Stearns Cos. 2,535 108,054
-------------------
-------------------
Marathon Value Fund
Schedule of Investments - October 31, 1999 - continued
Common stocks - continued
Shares Value
FINANCE - continued
Real Estate Investment Trusts - 1.6%
Ventas, Inc.(b) 13,600 $ 66,300
-------------------
-------------------
TOTAL FINANCE 578,854
-------------------
-------------------
HEALTH - 12.4%
Diversified - 1.9%
Warner-Lambert, Inc. 1,000 79,812
-------------------
-------------------
Drugs & Pharmaceuticals - 6.2%
Lilly (Eli) 1,800 123,975
Merck & Co., Inc. 600 47,737
Watson Pharmaceuticals (b) 2,600 82,550
-------------------
-------------------
254,262
-------------------
-------------------
Medical Equipment & Supplies - 4.3%
Biomet, Inc. 3,100 93,388
Guidant Corp. 1,650 81,469
-------------------
-------------------
174,857
-------------------
-------------------
TOTAL HEALTH 508,931
-------------------
-------------------
MEDIA & LEISURE - 5.7%
Broadcasting - 3.5%
Comcast Corp-class A, Non-voting 1,900 80,038
MediaOneGroup (b) 900 63,956
-------------------
-------------------
143,994
-------------------
-------------------
Entertainment - 2.2%
Time Warner, Inc. 1,300 90,594
-------------------
-------------------
TOTAL MEDIA & LEISURE 234,588
-------------------
-------------------
NON-DURABLES - 3.3%
Beverages - 3.3%
PepsiCo, Inc. 3,900 135,281
-------------------
-------------------
RETAIL & WHOLESALE - 9.6%
Apparel Stores - 6.9%
Dress Barn (b) 9,100 161,810
Men's Warehouse (b) 5,600 122,850
-------------------
-------------------
284,660
-------------------
-------------------
Marathon Value Fund
Schedule of Investments - October 31, 1999 - continued
Common stocks - continued Shares Value
RETAIL & WHOLESALE - continued
Grocery Stores - 2.7%
Albertson's Inc. 3,020 $ 109,664
-------------------
-------------------
TOTAL RETAIL & WHOLESALE 394,324
-------------------
-------------------
SERVICES - 2.0%
Services - 2.0%
NOVA Corp. (b) 3,100 80,600
-------------------
-------------------
TECHNOLOGY - 21.1%
Communications Equipment - 2.9%
ADC Telecommunications, Inc.(a) (b) 2,500 119,219
-------------------
-------------------
Computer Services & Software - 16.0%
BMC Software (b) 1,100 70,606
Computer Sciences Corp. (b) 2,000 137,375
Compuware Corp. (b) 3,700 102,906
CSG Systems International, Inc. (b) 4,000 137,250
SunGard Data Systems (b) 5,000 122,188
Transaction Systems Architects (b) 2,900 89,175
-------------------
-------------------
659,500
-------------------
-------------------
Computers & Office Equipment - 2.2%
International Business Machines, Inc. 900 88,537
-------------------
-------------------
TOTAL TECHNOLOGY 867,256
-------------------
-------------------
TRANSPORTATION - 3.9%
Trucking & Freight - 3.9%
Covenant Transport - Class A (b) 5,000 76,875
Werner Enterprises 5,150 82,078
-------------------
-------------------
158,953
-------------------
-------------------
UTILITIES - 3.1%
Telephone Services - 3.1%
MCI WorldCom (b) 1,500 128,719
-------------------
-------------------
TOTAL COMMON STOCKS (Cost $3,610,996) 3,664,347
-------------------
-------------------
</TABLE>
<TABLE>
<CAPTION>
Marathon Value Fund
Schedule of Investments - October 31, 1999 - continued
<S> <C> <C> <C>
Principal
Amount Value
MONEY MARKET SECURITIES - 11.5%
Firstar Treasury Fund, 4.41% (c) (Cost $472,900) 472,900 $ 472,900
-------------------
-------------------
TOTAL INVESTMENTS - 100.6% (Cost $4,083,896) 4,137,247
-------------------
-------------------
Other Assets less Liabilities - (0.6%) (21,153)
-------------------
-------------------
TOTAL NET ASSETS - 100.0% $4,116,094
===================
===================
(a) Security is segregated as collateral for options written.
(b) Non-income producing
(c) Variable rate security; the coupon rate shown represents the rate at October
31, 1999.
Call Options Written October 31, 1999
Shares
Subject
Common Stocks / Expiration Date @ Exercise Price to Call Value
ADC Telecommunications, Inc. / February 2000 @ 40
(premiums received $18,312) 2,500 $ 24,375
===================
===================
</TABLE>
<TABLE>
<CAPTION>
Marathon Value Fund October 31, 1999
Statement of Assets & Liabilities
<S> <C> <C>
Assets
Investment in securities, at value (cost $4,083,896) $4,137,247
Cash 4,959
Dividends receivable 1,939
Interest receivable 1,349
-------------------
Total assets 4,145,494
Liabilities
Accrued investment advisory fee payable $ 5,025
Covered call options written -
premiums received $18,312 24,375
-------------------
Total liabilities 29,400
-------------------
Net Assets $4,116,094
===================
Net Assets consist of:
Paid in capital $4,348,518
Undistributed Net Investment Loss (16)
Accumulated undistributed net realized loss on security transactions (337,914)
Accumulated undistributed net realized gain on options transactions 58,218
Net unrealized appreciation on investments 47,288
-------------------
Net Assets, for 446,066 shares $4,116,094
===================
Net Asset Value
Net Assets
Offering price and redemption price per share ($4,116,094 / 446,066) $ 9.23
===================
</TABLE>
<TABLE>
<CAPTION>
<CAPTION>
Marathon Value Fund
Statement of Operations for the year ended October 31, 1999
<S> <C> <C>
Investment Income
Dividend Income $ 31,693
Interest Income 22,418
--------------------
Total Income 54,111
Expenses
Investment advisory fee $ 56,824
Trustees' fees 1,377
-------------------
Total expenses before reimbursement 58,201
Reimbursed expenses (1,377)
-------------------
Total operating expenses 56,824
--------------------
Net Investment Income (Loss) (2,713)
--------------------
Realized & Unrealized Gain
Net realized gain (loss) on investment securities (79,076)
Net realized gain on options transactions 39,468
Change in net unrealized appreciation (depreciation)
on investment securities 352,742
-------------------
Net gain (loss) on investment securities 313,134
--------------------
Net increase in net assets resulting from operations $ 310,421
====================
</TABLE>
<TABLE>
<CAPTION>
Marathon Value Fund
Statement of Changes in Net Assets
<S> <C> <C>
Year Period
ended ended
October 31, October 31,
1999 1998 (a)
------------------ -----------------
Increase/(Decrease) in Net Assets
Operations
Net investment income $ (2,713) $ 6,326
Net realized gain (loss) on investment securities (79,076) (258,838)
Net realized gain on options transactions 39,468 18,750
Change in net unrealized appreciation (depreciation) 352,742 (305,454)
------------------ -----------------
Net increase (decrease) in net assets
------------------ -----------------
resulting from operations 310,421 (539,216)
------------------ -----------------
Distributions to shareholders
From net investment income (6,342) -
------------------ -----------------
Share Transactions
Net proceeds from sale of shares 617,317 3,806,088
Shares issued in reinvestment of distributions 6,329 -
Shares redeemed (70,282) (8,221)
------------------ -----------------
Net increase in net assets resulting
from share transactions 553,364 3,797,867
------------------ -----------------
Total increase in net assets 857,443 3,258,651
Net Assets
Beginning of period 3,258,651 -
------------------ -----------------
End of period [including accumulated
undistributed net investment income(loss)
of $(16) and $6,326, respectively] $4,116,094 $3,258,651
================== =================
(a) March 12, 1998 (commencement of operations) to October 31, 1998
</TABLE>
<TABLE>
<CAPTION>
Marathon Value Fund
Financial Highlights
<S> <C> <C>
Year Period
ended ended
October 31, October 31,
1999 1998 (a)
------------------ ------------------
Selected Per Share Data
Net asset value, beginning of period $ 8.48 $ 10.00
------------------ ------------------
Income from investment operations
Net investment income (0.01) 0.02
Net realized and unrealized gain (loss) 0.78 (1.54)
------------------ ------------------
Total from investment operations 0.77 (1.52)
------------------ ------------------
Less Distributions
From net investment income (0.02) -
------------------ ------------------
Net asset value, end of period $ 9.23 $ 8.48
================== ==================
Total Return (b) 9.04% (15.20)%
Ratios and Supplemental Data
Net assets, end of period (000) $4,116 $3,259
Ratio of expenses to average net assets 1.48% 1.47% (c)
Ratio of expenses to average net assets
before reimbursement 1.51% 1.50% (c)
Ratio of net investment income (loss) to
average net assets (0.07)% 0.36% (c)
Ratio of net investment income (loss) to
average net assets before reimbursement (0.11)% 0.33% (c)
Portfolio turnover rate 140.37% 61.04% (c)
(a) March 12, 1998 (commencement of operations) to October 31, 1998
(b) For periods of less than a full year, total returns are not annualized.
(c) Annualized
</TABLE>
Marathon Value Fund
Notes To Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
Marathon Value Fund (the "Fund") is organized as a series of the AmeriPrime
Funds, an Ohio business trust (the "Trust"). The Fund is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
management investment company. The Fund's investment objective is to provide
maximum long-term capital appreciation. The Declaration of Trust permits the
trustees to issue an unlimited number of shares of beneficial interest of
separate series without par value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuation- Securities which are traded on any exchange or on the
NASDAQ over-the-counter market are valued at the last quoted sale price. Lacking
a last sale price, a security is valued at its last bid price except when, in
the Advisor's opinion, the last bid price does not accurately reflect the
current value of the security. All other securities for which over-the-counter
market quotations are readily available are valued at their last bid price. When
market quotations are not readily available, when the Advisor determines the
last bid price does not accurately reflect the current value or when restricted
securities are being valued, such securities are valued as determined in good
faith by the Advisor, in conformity with guidelines adopted by and subject to
review of the Board of Trustees of the Trust (the "Board").
Fixed-income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market values of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Advisor,
subject to review of the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
Marathon Value Fund
Notes To Financial Statements
October 31, 1999 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Option writing- When the Fund writes an option, an amount equal to the premium
received by the Fund is recorded as a liability and is subsequently adjusted to
the current fair value of the option written. Premiums received from writing
options that expire unexercised are treated by the Fund on the expiration date
as realized gains from investments. The difference between the premium and the
amount paid on effecting a closing purchase transaction, including brokerage
commissions, is also treated as a realized gain, or if the premium is less than
the amount paid for the closing purchase transaction, as a realized loss. If a
call option is exercised, the premium is added to the proceeds from the sale of
the underlying security or currency in determining whether the Fund has realized
a gain or loss. If a put option is exercised, the premium reduces the cost basis
of the securities purchased by the fund. The Fund as writer of an option bears
the market risk of an unfavorable change in the price of the security underlying
the written option.
Federal Income Taxes - The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains.
Dividends and Distributions - The Fund intends to comply with federal tax rules
regarding distribution of substantially all of its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year. The Fund has loss carryforwards of $279,696 at October 31, 1999;
$39,608 expiring in 2007 and $240,088 expiring in 2006.
Other - The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Burroughs & Hutchinson, Inc. (the "Advisor") to manage the
Fund's investments. Mark Matsko, the Fund's portfolio manager, is primarily
responsible for the day-to-day management of the Fund's portfolio.
Marathon Value Fund
Notes To Financial Statements
October 31, 1999 - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
Under the terms of the management agreement, (the "Agreement"), the Advisor
manages the Fund's investments subject to approval of the Board of Trustees and
pays all expenses of the Fund except brokerage commissions, taxes, interest,
fees and expenses of the non-interested person trustees, and extraordinary
expenses. As compensation for its management services and agreement to pay the
Fund's expenses, the Fund is obligated to pay the Advisor a fee computed and
accrued daily and paid monthly at an annual rate of 1.48% of the average daily
net assets of the Fund. It should be noted that most investment companies pay
their own operating expenses directly, while the Fund's expenses, except those
specified above, are paid by the Advisor. For the year ended October 31, 1999,
the Advisor has received a fee of $56,824 from the Fund. The Advisor has
voluntarily agreed to reimburse other expenses for the fiscal year ended October
31, 1999 to the extent necessary to maintain total operating expenses at the
rate of 1.48%. For the year ended October 31, 1999, the Advisor reimbursed
expenses of $1,377. There is no assurance that such reimbursement will continue
in the future.
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Funds business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment and
personnel. For the year ended October 31, 1999, the Administrator received fees
of $30,000 from the Advisor for administrative services provided to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. (the Distributor) to
act as the principal distributor of the Fund's shares. There were no payments
made to the Distributor for the year ended October 31, 1999. Certain members of
management of the Administrator and the Distributor are also members of
management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, there was an unlimited number of authorized shares
for the Fund. Paid in capital at October 31, 1999 was $4,348,518.
Marathon Value Fund
Notes To Financial Statements
October 31, 1999 - continued
NOTE 4. SHARE TRANSACTIONS- continued
Transactions in shares were as follows:
<TABLE>
- --------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year ended Period ended
October 31, 1999 October 31, 1998 (a)
- --------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares Dollars Shares Dollars
- -------------------------------------------------------------------------------------------------------------------------
Shares sold 69,009 $617,317 385,265 $3,806,088
- -------------------------------------------------------------------------------------------------------------------------
Shares issued in reinvestment of dividends
718 6,329 - -
- -------------------------------------------------------------------------------------------------------------------------
Shares redeemed
(7,846) (70,282) (1,080) (8,221)
- -------------------------------------------------------------------------------------------------------------------------
61,881 $553,364 384,185 $3,797,867
- -------------------------------------------------------------------------------------------------------------------------
====== ======= ====== ========
(a) March 12, 1998 (commencement of operations) to October 31, 1998
</TABLE>
NOTE 5. INVESTMENTS
For the year ended October 31, 1999, purchases and sales of investment
securities, other than short-term investments, aggregated $5,043,345 and
$4,658,167, respectively. As of October 31, 1999, the gross unrealized
appreciation for all securities totaled $307,078 and the gross unrealized
depreciation for all securities totaled $259,790 for a net unrealized
appreciation of $47,288. The aggregate cost of securities for federal income tax
purposes at October 31,1999, was $4,083,896.
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
Marathon Value Fund
Notes To Financial Statements
October 31, 1999 - continued
NOTE 7. RELATED PARTY TRANSACTIONS
The Advisor is not a registered broker-dealer of securities and thus does
not receive commissions on trades made on behalf of the Fund. The beneficial
ownership, either directly or indirectly, of more than 25% of the voting
securities of a Fund creates a presumption of control of the Fund, under Section
2(a)(9) of the Investment Company Act of 1940. As of October 31, 1999, Charles
Schwab & Co. owned of record in aggregate more than 73% of the Fund.
NOTE 8. CALL OPTIONS WRITTEN
As of October 31, 1999, portfolio securities valued at $119,219 were held
in escrow by the custodian as cover for call options written by the Fund.
Transactions in options written during the year ended October 31, 1999 were as
follows:
<TABLE>
- --------------------------------------------------------------------------------------------------------------
<CAPTION>
Number of Premiums
Contracts Received
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Options outstanding at October 31, 1998 210 $45,075
- --------------------------------------------------------------------------------------------------------------
Options written 25 18,312
- --------------------------------------------------------------------------------------------------------------
Options terminated in closing purchase transactions (65) (7,394)
- --------------------------------------------------------------------------------------------------------------
Options expired (115) (34,644)
- --------------------------------------------------------------------------------------------------------------
Options exercised (30) (3,037)
- --------------------------------------------------------------------------------------------------------------
Options outstanding at October 31, 1999 25 $18,312
- --------------------------------------------------------------------------------------------------------------
====== =========
</TABLE>
NOTE 9. RECLASSIFICATIONS
In accordance with SOP 93-2, the fund has recorded a reclassification in
the capital accounts. As of October 31, 1999, the fund recorded permanent
book/tax differences of $2,713 from net investment loss to paid-in-capital. This
reclassification has no impact on the net asset value of the fund and is
designed generally to present undistributed income and realized gains on a tax
basis which is considered to be more informative to shareholders.
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
Marathon Value Fund
We have audited the accompanying statement of assets and liabilities of the
Marathon Value Fund, including the schedule of portfolio investments, as of
October 31, 1999, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and financial highlights for each of the periods indicated.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Marathon Value Fund as of October 31, 1999, the results of its operations for
the year then ended, the changes in its net assets for each of the two years in
the period then ended, and the financial highlights for each of the periods
indicated, in conformity with generally accepted accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
<PAGE>
Fountainhead Special Value Fund
Shareholder Letter
Dear Fellow Shareholders:
October 31, 1999 marked the completion of the Fountainhead Special Value Fund's
third fiscal year. Our long-term results, thus far, are outstanding. Since the
Fund's inception on December 31, 1996, our cumulative return is 131.2%. The
annualized return for this period is a very rewarding 34.4%, versus 13.6% for
the Russell Midcap Index, 25.6% for the S&P 500 Index, and 7.6% for the Russell
2000 Index.
For the 1999 fiscal year, which turned out to be a stellar one for Fountainhead,
the Fund had a return of 81.3%, easily outperforming any comparable benchmark.
Over the same one-year period, the Russell Midcap returned 17.6%, the S&P 500
27.1%, and the Russell 2000 16.1%.
- ------------------------------------------------------------------------------
Returns for the Periods Ended 10/31/99
- ------------------------------------------------------------------------------
Average Annual
Return Since Inception
- ------------------------------------------------------------------------------
Fund/Index 1 Year December 31, 1996
- ----------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Fountainhead Special Value Fund 81.3% 34.4%
- ------------------------------------------------------------------------------
Russell MidCap Index 17.6% 15.3%
- ------------------------------------------------------------------------------
Russell 2000 Index 16.1% 7.5%
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Fountainhead Special Value Russell 2000 Russell Midcap
Fund - $23,105 Index- $12,266 Index - $14,960
<S> <C> <C> <C> <C>
12/96 $10,000 $10,000 $10,000
1/97 $10,420 $10,200 $10,374
2/97 $10,830 $9,952 $10,358
3/97 $10,140 $9,482 $9,918
4/97 $9,860 $9,509 $10,165
5/97 $10,869 $10,567 $10,907
6/97 $11,560 $11,021 $11,264
7/97 $11,990 $11,533 $12,203
8/97 $11,860 $11,797 $12,270
9/97 $12,950 $12,661 $12,759
10/97 $13,370 $12,105 $12,263
11/97 $13,070 $12,026 $12,555
12/97 $13,665 $12,237 $12,902
1/98 $13,433 $12,043 $12,659
2/98 $14,757 $12,933 $13,649
3/98 $15,910 $13,466 $14,296
4/98 $16,476 $13,540 $14,332
5/98 $15,758 $12,810 $13,887
6/98 $16,232 $12,837 $14,080
7/98 $15,424 $11,798 $13,409
8/98 $11,976 $9,506 $11,263
9/98 $12,229 $10,251 $11,992
10/98 $12,481 $10,669 $12,810
11/98 $11,730 $11,232 $13,417
12/98 $12,913 $11,933 $14,205
1/99 $13,967 $12,088 $14,181
2/99 $14,240 $11,114 $13,708
3/99 $15,352 $11,285 $14,137
4/99 $16,534 $12,296 $15,182
5/99 $17,382 $12,476 $15,138
6/99 $18,665 $13,040 $15,673
7/99 $19,008 $12,683 $15,242
8/99 $18,927 $12,213 $14,847
9/99 $20,210 $12,216 $14,324
10/99 $23,105 $12,266 $14,960
</TABLE>
The chart shows the value of a hypothetical initial investment of $10,000 in the
Fund, the Russell MidCap Index, and the Russell 2000 Index on December 31, 1996
and held through October 31, 1999. The Russell MidCap Index and the Russell 2000
Index are widely recognized, unmanaged indices of common stock prices.
Performance figures include the change in value of the stocks in the indices and
the reinvestment of dividends; they are not annualized. The index returns do not
reflect expenses, which have been deducted from the Fund's return. THE FUND'S
RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE OF FUTURE RESULTS.
Aside from performance, this last fiscal year has been an exciting year for the
Fund as several major milestones were passed. First, we received a ticker
symbol, KINGX, so it is now easier for you to access our NAV. Second,
Fountainhead's results have propelled the Fund to the top of its peer group. As
of October 29, 1999, the Fund ranked first in performance for the one year ended
October 31, 1999, out of 159 mid-cap value funds, according to Lipper Analytical
Services. Finally, the Fund topped $14 million in assets.
Performance this past year was driven primarily by outstanding results from our
holdings in telecommunications stocks. In late December 1998, Vodafone entered
into a definitive agreement to acquire AirTouch Communications at a significant
premium--an action which would serve to unlock the inherent value in the
wireless industry. AirTouch was a major domino to fall in the wireless group,
sparking a round of consolidation and intense interest in the industry; leading
to an explosion in share price appreciation. For example, for the year ended
October 31, 1999, Rural Cellular has risen 402% in price, OmniPont +345%, Nextel
Communications +327%, Global Crossing (which acquired Frontier Communications)
+232%, Telephone & Data Systems +230%, Western Wireless +196%, and Clearnet
Communications +179%--all of which are owned by the Fund. In addition to
telecommunications stocks, strong performance was generated by
broadcasting/cable stocks (CMP Media + 231%, Cablevision Systems +68%, Getty
Images +67%, MediaOne Group +60%, and UnitedGlobalCom +58%). Some of the Fund's
other holdings, such as select healthcare, financial, and consumer services
stocks, underperformed over the period, but still have good risk/reward
potential.
We would like to stress that while fiscal 1999 was an outstanding year and
shareholders were amply rewarded, such a robust performance is not likely to be
duplicated in fiscal 2000. Regardless, we are optimistic about our holdings and
about mid- and small-caps in general.
The Fund's numbers look especially impressive when viewed against this year's
overall weaker performance in the broader market. For the average stock, the
period from April 1998 through September 1999 was in reality a bear market. The
majority of stocks, over 50%, were down 20% or more from their 52-week high. The
equity markets continued to be very narrow for the majority of the year, with
only a handful of stocks accounting for the moves in the major indices. For
example, through September 30, 1999, only 6 stocks, or 1.2% of the entire index,
accounted for the entire return in the S&P 500 Index. The combination of rising
interest rates, rising oil and gold prices, and a stronger dollar caused quite a
bit of uncertainty, contributing to continued underperformance by the broader
market versus a handful of megacap favorites.
In October 1999, Alan Greenspan once again spoke cautiously about the lofty
valuation of the stock market. We believe it prudent to point out that we do not
believe these comments are aimed at the majority of stocks, but at a handful of
securities such as the "dot coms," Microsofts, and America Onlines of the world.
Greenspan's model, which compares the yield for the ten-year Treasury note with
the S&P 500 earnings yield, finds the stock index more than 30% overvalued.
However, these comments are not representative of the valuations accorded most
shares. For example, the median P/E for the S&P 500 is currently 15.2x year 2000
earnings estimates. In addition, on a valuation basis, small-cap stocks
experienced their largest valuation dispersion versus large-cap stocks in
history in 1998. The bottom line is that the risk/reward for many stocks is very
favorable today.
With respect to mid- and small-caps, there is a silver lining on the horizon.
The overall economic environment appears to be better than what people thought a
few short months ago. For starters, the U.S. economy is still experiencing
growth, but with inflation in check. Some early signs of trouble, such as rising
employment costs and escalating gold and oil prices, have begun to fade away as
productivity gains and technological advances appear to be paving the way for a
world which can accommodate controlled growth with no major inflationary
pressures, a marked change from the past. In addition, the resurrection of Asia
and a pick-up in global growth are providing an environment for more robust
corporate growth.
Many large-cap stocks are trading at such high valuation benchmarks that there
is little room for error with respect to not meeting Wall Street's lofty
estimates. Many people believe that large-cap stocks are "safe" stocks. This is
not always the case when valuations become extended. In 1999, a sizable number
of large-caps, many of which are household names, fell by the wayside and
experienced huge one-day declines due to an earnings shortfall. Examples include
McKesson HBOC which declined 48% in price in April, Service Corp. -44% in
January, Raytheon -44% in October, Waste Management -37% in July, and Mattel
- -30% in October. In fact, one-day plunges of at least 15% in components of the
S&P 500 Index have almost doubled from 35 in 1997 to 65 thus far in 1999. On the
opposite side, many good companies in the mid- and small-cap arena can be
purchased today with valuations which more than discount most potential bad
news.
What is the case for a reversal in performance in the mid- and small-cap group?
First, asset classes tend to outperform/underperform each other in cycles. Mid-
and small-cap stocks have been underperforming their large-cap brethren for the
majority of the 1990s. If you look at historical results over long time frames,
these periods of underperformance always manage to reverse themselves. Second,
greater confidence in the economy and the stabilization and eventual decline of
interest rates should spill over to increased buying in a broader range of
stocks. Third, the level of inflows into mid- and small-cap mutual funds may
accelerate. After suffering massive redemptions in the first quarter of 1999,
money flows into these funds have turned modestly positive over the past six
months. Any institutional return to the smaller stocks will amplify performance
in this currently liquidity-challenged group.
In summary, while fiscal 1999 was an outstanding year, we believe performance
results in 2000 will more than likely not mimic those generated in 1999. We are,
however, optimistic about the future and believe much opportunity currently
exists in mid- and small-cap stocks. Furthermore, we believe that we are well
positioned for an excellent 2000. This optimism is indicated by the fact that
all our investment team and key administrative staff are shareholders in the
Fund.
Sincerely,
Roger E. King
Chairman and President
<PAGE>
<TABLE>
<CAPTION>
Fountainhead Special Value Fund
Schedule of Investments - October 31, 1999
<S> <C> <C>
Common Stocks - 99.6% Shares Value
Cable & Other Pay Television Services - 7.9%
Adelphia Communication Corp. - Class A (a) 10,308 $ 563,075
Cablevision Systems Corp. - Class A (a) 23,000 547,256
----------------------
----------------------
1,110,331
----------------------
----------------------
Calculation & Accounting Machines - 3.1%
Diebold, Inc. 16,700 438,375
----------------------
----------------------
Communication Services - 0.4%
Convergent Communications Inc. (a) 6,000 60,000
----------------------
----------------------
Computer Communication Equipment - 2.7%
Cabletron Systems, Inc. (a) 8,100 380,938
----------------------
----------------------
Electric & Other Services Combined - 1.2%
Citizens Utilities Company 15,000 173,437
----------------------
----------------------
Electromedical & Electrotherapeutic Apparatus - 2.0%
St. Jude Medical, Inc. (a) 10,200 279,225
----------------------
----------------------
Laboratory Analytical Instruments - 3.2%
Beckman Coulter, Inc. 9,800 450,800
----------------------
----------------------
Life Insurance - 2.2%
ReliaStar Financial Corp. 7,000 300,563
----------------------
----------------------
Pharmaceuticals - 9.2%
Dura Pharmaceuticals, Inc. (a) 67,900 867,850
Watson Pharmaceuticals, Inc. (a) 13,200 419,100
----------------------
----------------------
1,286,950
----------------------
----------------------
Radio Telephone Communications - 30.5%
NEXTEL Communications, Inc - Class A (a) 7,900 680,881
Omnipoint Corp. (a) 16,800 1,388,100
Price Communications Corp. 22,000 478,500
Rural Cellular Corp. - Class A (a) 11,400 686,138
Telephone & Data Systems 6,800 783,700
Western Wireless Corp. - Class A 5,200 274,950
----------------------
----------------------
4,292,269
----------------------
----------------------
Services-Business Services - 4.9%
Getty Images, Inc. (a) 22,500 693,281
----------------------
----------------------
Fountainhead Special Value Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
Services-Computer Processing & Data Preparation - 4.0%
CSG Systems International, Inc. (a) 16,500 $ 566,156
----------------------
----------------------
Telephone Communications - 22.0%
Cincinnati Bell 9,100 189,394
Destia Communications, Inc. (a) 18,000 252,000
Global Crossing Ltd. (a) 28,290 979,541
IXC Communications, Inc. (a) 11,700 505,294
Media One Group, Inc. (a) 2,900 206,081
RSL Communications - Class A (a) 13,500 295,313
Viatel, Inc. (a) 9,400 313,725
Williams Communications Group, Inc. (a) 5,000 159,375
Winstar Communications, Inc. (a) 5,000 194,062
----------------------
----------------------
3,094,785
----------------------
----------------------
Wholesale-Electronic Parts & Equipment - 6.3%
Clearnet Communications - Class A (a) (c) 16,700 367,400
United Global Communications (a) 6,000 522,000
----------------------
----------------------
889,400
----------------------
----------------------
TOTAL COMMON STOCKS (Cost $9,191,420) 14,016,510
----------------------
----------------------
Principal
Amount Value
Money Market Securities - 2.7%
Firstar Treasury Fund, 4.41% (b) (Cost $385,203) 385,203 385,203
----------------------
----------------------
TOTAL INVESTMENTS - 102.3% (Cost $9,576,623) 14,401,713
----------------------
----------------------
Other Assets less Liabilities - (2.3%) (333,908)
----------------------
----------------------
Total Net Assets - 100.0% $ 14,067,805
======================
======================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at October
29, 1999.
(c) American Depository Receipt
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fountainhead Special Value Fund October 31, 1999
Statement of Assets & Liabilities
<S> <C> <C>
Assets
Investment in securities, at value (Cost $9,576,623) $ 14,401,713
Cash 24,743
Receivable for investment sold 1,120,895
Dividends receivable 1,435
Interest receivable 634
Receivable from investment advisor for
reimbursed expenses 15,035
----------------------
Total assets 15,564,455
Liabilities
Accrued investment advisory fee payable $ 15,622
Payable for securities purchased 1,467,278
Payable for fund shares redeemed 45
Other payables and accrued expenses 13,705
----------------------
Total liabilities 1,496,650
----------------------
Net Assets $ 14,067,805
======================
Net Assets consist of:
Paid in capital $ 8,672,563
Accumulated undistributed net realized gain on investments 570,152
Net unrealized appreciation on investments 4,825,090
----------------------
Net Assets, for 615,349 shares $ 14,067,805
======================
Net Asset Value
Net Assets
Offering price and redemption price per share ($14,067,805 / 615,349) $ 22.86
======================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fountainhead Special Value Fund
Statement of Operations for the year ended October 31, 1999
<S> <C> <C>
Investment Income
Dividend Income $ 21,973
Interest Income 5,036
------------------
Total Income 27,009
Expenses
Investment advisory fee $ 128,855
Administration fees 32,500
Pricing & bookkeeping fees 15,797
Transfer agent fees 14,260
Legal fees 8,397
Shareholder reports 6,133
Custodian fees 6,500
Registration fees 5,686
Audit fees 5,500
Trustees' fees 1,377
Miscellaneous 514
------------------
Total expenses before waivers and reimbursements 225,519
Waived fees and reimbursed expenses (112,738)
------------------
Total operating expenses 112,781
------------------
Net Investment Income (Loss) (85,772)
------------------
Realized & Unrealized Gain (Loss)
Net realized gain on investment securities 670,151
Change in net unrealized appreciation (depreciation)
on investment securities 5,115,600
------------------
Net gain on investment securities 5,785,751
------------------
Net increase in net assets resulting from operations $ 5,699,979
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fountainhead Special Value Fund
Statement of Changes in Net Assets
<S> <C> <C>
Year Year
ended ended
October 31, October 31,
1999 1998
---------------------- ----------------------
Increase/(Decrease) in Net Assets
Operations
Net investment income (loss) $ (85,772) $ (37,441)
Net realized gain (loss) on
investment securities 670,151 (188)
Change in net unrealized
appreciation (depreciation) 5,115,600 (655,499)
---------------------- ----------------------
Net increase (decrease) in net assets
resulting from operations 5,699,979 (693,128)
---------------------- ----------------------
Distributions to shareholders
From net realized gain - (34,177)
---------------------- ----------------------
Share Transactions
Net proceeds from sale of shares 3,403,006 4,888,881
Shares issued in reinvestment
of distributions - 34,164
Shares redeemed (1,672,500) (187,621)
---------------------- ----------------------
Net increase (decrease) in net assets
resulting from share transactions 1,730,506 4,735,424
---------------------- ----------------------
Total increase in net assets 7,430,485 4,008,119
Net Assets
Beginning of period 6,637,320 2,629,201
---------------------- ----------------------
End of period [including accumulated
undistributed net investment income (loss) of
$0 and $0, respectively] $ 14,067,805 $ 6,637,320
====================== ======================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fountainhead Special Value Fund
Financial Highlights
<S> <C> <C> <C>
Year Year Period
ended ended ended
October 31, October 31, October 31,
1999 1998 1997 (a)
----------------- ------------------ ------------------
Selected Per Share Data
Net asset value, beginning of period $ 12.61 $ 13.35 $ 10.00
----------------- ------------------ ------------------
Income from investment operations
Net investment income (loss) (0.16) (0.09) (0.02)
Net realized and unrealized gain (loss) 10.41 (0.51) 3.37
----------------- ------------------ ------------------
Total from investment operations 10.25 (0.60) 3.35
----------------- ------------------ ------------------
Less Distributions
From net realized gain - (0.14) -
----------------- ------------------ ------------------
Net asset value, end of period $ 22.86 $ 12.61 $ 13.35
================= ================== ==================
Total Return (b) 81.28% (4.67)% 33.70%
Ratios and Supplemental Data
Net assets, end of period (000) $14,068 $6,637 $2,629
Ratio of expenses to average net assets 1.25% 1.20% 0.97% (c)
Ratio of expenses to average net assets
before fee waivers and reimbursement 2.50% 2.76% 8.25% (c)
Ratio of net investment income (loss) to
average net assets (0.95)% (0.67)% (0.16)(c)
Ratio of net investment income (loss) to
average net assets
before fee waivers and reimbursement (2.20)% (2.22)% (7.45)(c)
Portfolio turnover rate 177.56% 108.31% 130.63% (c)
(a) December 31, 1996 (commencement of operations) to October 31, 1997
(b) For periods of less than a full year, total returns are not annualized.
(c) Annualized
</TABLE>
<PAGE>
Fountainhead Special Value Fund
Notes To Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
The Fountainhead Special Value Fund (the "Fund") is organized as a series
of the AmeriPrime Funds, an Ohio business trust (the "Trust"). The Fund is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. The Fund's investment
objective is to provide long-term capital growth. The Declaration of Trust
Agreement for the fund permits the Board of Trustees (the "Board") to issue an
unlimited number of shares of beneficial interest of separate series without par
value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuation- Securities which are traded on any exchange or on the
NASDAQ over-the-counter market are valued at the last-quoted sale price. Lacking
a last sale price, a security is valued at its last bid price except when, in
the opinion of the Advisor (as such term is defined in note 3 of this document),
the last bid price does not accurately reflect the current value of the
security. All other securities for which over-the-counter market quotations are
readily available are valued at their last bid price. When market quotations are
not readily available, when the Advisor determines the last bid price does not
accurately reflect the current value, or when restricted securities are being
valued, such securities are valued as determined in good faith by the Advisor,
in conformity with guidelines adopted by and subject to review of the Board.
Fixed-income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market values of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Advisor,
subject to review by the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the
amortized-cost method of valuation, which the Board has determined will
represent fair value.
Fountainhead Special Value Fund
Notes To Financial Statements
October 31, 1999 - cont'd
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - cont'd
Federal Income Taxes- The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all its net investment income and any realized
capital gains.
Dividends and Distributions- The Fund intends to comply with federal tax rules
regarding distribution of substantially all its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year.
Other- The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains King Investment Advisors, Inc. (the "Advisor") to
manage the Fund's investments. Roger E. King, President of the Advisor, is
primarily responsible for the day-to-day management of the Fund's portfolio.
Under the terms of the management agreement between the Fund and the
Advisor, (the "Agreement"), the Advisor manages the Fund's investments subject
to approval of the Board. As compensation for its management services, the Fund
is obligated to pay the Advisor a fee computed and accrued daily and paid
monthly at an annual rate of 1.43% of the average daily net assets of the Fund.
For the year ended October 31, 1999, the Advisor received a fee of $128,855 from
the Fund. The Advisor voluntarily agreed to waive fees and reimburse expenses
for the Fund for the fiscal year ended October 31, 1999 to the extent necessary
to maintain total operating expenses at the rate of 1.25%. For the year ended
October 31, 1999, the Advisor waived fees and reimbursed expenses of $112,738.
There is no assurance that such an arrangement will continue in the future.
Fountainhead Special Value Fund
Notes To Financial Statements
October 31, 1999 - cont'd
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - cont'd
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Fund's business affairs and to provide the Fund with
administrative services, including all regulatory reporting and necessary office
equipment and personnel. For the year ended October 31, 1999, the Administrator
received fees of $32,500 from the Advisor for administrative services provided
to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. (the "Distributor")
to act as the principal distributor of the Fund's shares. No payments were made
to the Distributor for the year ended October 31, 1999. Certain members of
management of the Administrator and the Distributor are also members of
management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, the Fund had an unlimited number of authorized
shares. Paid-in capital at October 31, 1999 was $8,672,563.
Transactions in shares were as follows:
<TABLE>
- --------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year ended Year ended
October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares Dollars Shares Dollars
- -------------------------------------------------------------------------------------------------------------------------
Shares sold 194,253 $3,403,006 341,534 $4,888,881
- -------------------------------------------------------------------------------------------------------------------------
Shares issued in reinvestment
of dividends
- - 2,614 34,164
- -------------------------------------------------------------------------------------------------------------------------
Shares redeemed
(105,383) (1,672,500) (14,634) (187,621)
- -------------------------------------------------------------------------------------------------------------------------
88,870 $1,730,506 329,514 $4,735,424
- -------------------------------------------------------------------------------------------------------------------------
======= ========= ======= ========
</TABLE>
Fountainhead Special Value Fund
Notes To Financial Statements
October 31, 1999 - cont'd
NOTE 5. INVESTMENTS
For the year ended October 31, 1999, purchases and sales of investment
securities, other than short-term investments, totaled $18,026,184 and
$15,944,615, respectively. The gross unrealized appreciation for all securities
totaled $4,934,899 and the gross unrealized depreciation for all securities
totaled $109,809 for a net unrealized appreciation of $4,825,090. The total cost
of securities for federal income tax purposes at October 31, 1999 was
$9,576,623.
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 7. RECLASSIFICATIONS
In accordance with SOP 93-2, the Fund has recorded a reclassification in
the capital accounts. As of October 31, 1999, the Fund recorded permanent
book/tax differences of $83,359 from net investment loss to accumulated
undistributed net realized gains and $2,413 from net investment loss to paid-in
capital. This reclassification has no impact on the net asset value of the Fund
and is designed generally to present undistributed income and realized gains on
a tax basis, which is considered to be more informative to shareholders.
<PAGE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
Fountainhead Special Value Fund
We have audited the accompanying statement of assets and liabilities of the
Fountainhead Special Value Fund, including the schedule of portfolio
investments, as of October 31, 1999, and the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and financial highlights for each of the periods
indicated. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Fountainhead Special Value Fund as of October 31, 1999, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each of
the periods indicated, in conformity with generally accepted accounting
principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
<PAGE>
December 1999
Dear Shareholders:
We are pleased to provide the Annual Report and investment results for the Carl
Domino Growth Fund. Since inception in December 1998 through October 31, 1999
the Fund has returned 7.0%.
Comparative Investment Returns Since Inception Return
-------------------------------- -----------------------
Carl Domino Growth Fund 7.0%
S&P 500 * 12.0%
Date CD Growth - $10,700 S&P 500 - $11,204
December 31, 1998 $10,000.00 $10,000.00
January 31, 1999 $10,650.00 $10,421.00
February 28, 1999 $10,180.00 $10,092.00
March 31, 1999 $10,700.00 $10,495.00
April 30, 1999 $10,450.00 $10,905.00
May 31, 1999 $10,010.00 $10,642.00
June 30, 1999 $10,530.00 $11,233.00
July 31, 1999 $10,240.00 $10,883.00
August 31, 1999 $10,300.00 $10,829.00
September 30, 1999 $10,020.00 $10,533.00
October 31, 1999 $10,700.00 $11,204.00
* Past performance is not predictive of future performance. This chart assumes
an initial investment of $10,000 in the Fund and the S&P 500 Index on December
31, 1998 and held through October 31, 1999. The S&P 500 Index is a widely
recognized unmanaged index of common stock prices. Performance figures include
the change in value of the stocks in the index and reinvestment of dividends.
The fund looks for companies that have dominant market shares, strong
franchises, and excellent management teams. The Fund's investment focus is where
we believe the strongest corporate growth will occur over the next few years.
These three major areas are currently high tech, medical (pharmaceuticals and
medical devices) and dominant consumer businesses.
The period from January 1, 1999 through October 31, 1999 was marked by
volatility in the stock market. Much of this volatility was driven by interest
rate concerns with the Federal Reserve raising rates in order to head off
potential inflation. Technology stocks driven by the investor focus on the
Internet performed well. Dominant consumer companies such as Wal-Mart and Home
Depot performed well in the healthy US economy.
The economy is enjoying stable growth, which is the result of low inventory
levels due to better information technology and the growing service sector. The
corporate profit picture is also healthy. The phenomenon of falling prices is
also likely to continue. Technological innovation, a global economy, and US
economic growth are supporting this trend. Finally, there are increasing
indications of economic rebounds overseas with Europe and Asia showing positive
momentum. This is helpful, since many of the companies in the Fund have a
significant international presence.
Be assured that although we cannot guarantee future results, the investment
professionals at Carl Domino Associates, L.P. will work hard to take advantage
of opportunities as they rise.
Sincerely,
Bruce Honig
Portfolio Manager
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Growth Fund
Schedule of Investments - October 31, 1999
<S> <C> <C>
Common Stocks - 99.4% Shares Value
Beverages - 2.7%
Coca-Cola Co. 540 $ 31,860
-----------------
-----------------
Building Supplies - 5.9%
Home Depot, Inc. 910 68,705
-----------------
-----------------
Cellular - 2.4%
Vodafone Airtouch Public (c) 600 28,762
-----------------
-----------------
Communications Equipment - 3.3%
Lucent Technologies, Inc. 600 38,550
-----------------
-----------------
Computer Services & Software - 14.4%
America Online, Inc. (a) 330 42,797
Microsoft, Inc. (a) 1,360 125,885
-----------------
-----------------
168,682
-----------------
-----------------
Computers & Office Equipment - 19.6%
Dell Computer Corp. (a) 1,540 61,793
EMC Corp. (a) 1,320 96,360
International Business Machines, Inc. 290 28,529
Sun Microsystems, Inc. (a) 400 42,325
-----------------
-----------------
229,007
-----------------
-----------------
Electronics - 6.6%
Intel Corp. 1,000 77,436
-----------------
-----------------
Federal Sponsored Credit - 7.2%
Freddie Mac 1,570 84,878
-----------------
-----------------
General Merchandise Stores - 5.3%
Wal-Mart Stores, Inc. 1,090 61,789
-----------------
-----------------
Insurance - 3.7%
Berkshire Hathaway - Class B (a) 21 43,890
-----------------
-----------------
Medical Equipment & Supplies - 8.0%
Johnson & Johnson, Inc. 360 37,710
Medtronic, Inc. 1,620 56,093
-----------------
-----------------
93,803
-----------------
-----------------
Pharmaceuticals - 5.2%
Pfizer, Inc. 780 30,810
Schering-Plough Corp. 600 29,700
-----------------
-----------------
60,510
-----------------
-----------------
Publishing - 3.1%
Gannett Co. 480 37,020
-----------------
-----------------
Carl Domino Growth Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
Telephone Services - 12.0%
AT&T Corp. 670 $ 31,323
MCI WorldCom (a) 1,260 108,124
-----------------
-----------------
139,447
-----------------
-----------------
TOTAL COMMON STOCKS (Cost $1,087,303) 1,164,339
-----------------
-----------------
Principal
Amount Value
Money Market Securities - 0.7%
Firstar Treasury Fund, 4.41% (b) (Cost $7,810) 7,810 7,810
-----------------
-----------------
TOTAL INVESTMENTS - 100.1% (Cost $1,095,113) 1,172,149
-----------------
-----------------
Other Assets less Liabilities - (0.1%) (1,359)
-----------------
-----------------
TOTAL NET ASSETS - 100.0% $ 1,170,790
=================
=================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at October
29, 1999.
(c) American Depository Receipt
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Growth Fund October 31, 1999
Statement of Assets & Liabilities
<S> <C> <C>
Assets
Investment in securities, at value (cost $1,095,113) $ 1,172,149
Dividend receivable 147
Interest receivable 92
Receivable from Advisor 7,158
------------------
Total assets 1,179,546
Liabilities
Payable to custodian bank $ 30
Accrued investment advisory fee payable 1,568
Federal taxes payable 7,158
-----------------
Total liabilities 8,756
------------------
Net Assets $ 1,170,790
==================
Net Assets consist of:
Paid in capital $ 1,123,485
Accumulated net realized gains on investments 47,305
------------------
Net Assets, for 109,404 shares $ 1,170,790
==================
Net Asset Value
Net Assets
Offering price and redemption price per share ($1,170,790 / 109,404) $ 10.70
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Growth Fund
<S> <C> <C>
Statement of Operations for the period December 31, 1998
(Commencement of Operations) to October 31, 1999
Investment Income
Dividend income $ 3,278
Interest income 1,027
------------------
Total Income 4,305
Expenses
Investment advisory fee $ 12,670
Trustees' fees 581
Federal taxes 7,158
---------------
Total expenses before reimbursement 20,409
Reimbursed expenses (7,739)
---------------
Total operating expenses 12,670
------------------
Net Investment Income (Loss) (8,365)
------------------
Realized & Unrealized Gain (Loss)
Net realized loss on investment securities (21,366)
Change in net unrealized appreciation (depreciation)
on investment securities 77,036
---------------
Net gain on investment securities 55,670
------------------
Net increase in net assets resulting from operations $ 47,305
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Growth Fund
Statement of Changes In Net Assets for the period December 31, 1998
(Commencement of Operations) to October 31, 1999
<S> <C>
Increase/(Decrease) in Net Assets
Operations
Net investment income (loss) $ (8,365)
Net realized gain on investment securities (21,366)
Change in net unrealized appreciation (depreciation) 77,036
-----------------
Net Increase in net assets resulting from operations 47,305
-----------------
Share Transactions
Net proceeds from sale of shares 1,227,300
Shares redeemed (103,815)
-----------------
Net increase in net assets resulting
from share transactions 1,123,485
-----------------
Total increase in net assets 1,170,790
Net Assets
Beginning of period -
-----------------
End of period [including accumulated undistributed net
investment income of $0] $ 1,170,790
=================
</TABLE>
<PAGE>
Carl Domino Growth Fund
Financial Highlights for the period December 31, 1998
(Commencement of Operations) to October 31, 1999
Selected Per Share Data
Net asset value, beginning of period $ 10.00
----------------
Income from investment operations
Net investment income (loss) (0.09)
Net realized and unrealized gain (loss) 0.79
----------------
----------------
Total from investment operations 0.70
----------------
Net asset value, end of period $ 10.70
================
Total Return (a) 7.00%
Ratios and Supplemental Data
Net assets, end of period (000) $1,171
Ratio of expenses to average net assets 1.50% (b)
Ratio of expenses to average net assets
before reimbursement 2.42% (b)
Ratio of net investment income (loss) to
average net assets (0.99)(b)
Ratio of net investment income (loss) to
average net assets before reimbursement (1.91)(b)
Portfolio turnover rate 34.37% (b)
(a) For periods of less than a full year, total returns are not annualized.
(b) Annualized
<PAGE>
Carl Domino Growth Fund
Notes to Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
Carl Domino Growth Fund (the "Fund") was organized as a series of the
AmeriPrime Funds, an Ohio business trust (the "Trust), on October 22, 1998 and
commenced operations on December 31, 1998. The Fund is registered under the
Investment Company Act of 1940, as amended, as a non-diversified open-end
management investment company. The Fund's investment objective is to provide
long term growth of capital. The Declaration of Trust permits the Trustees to
issue an unlimited number of shares of beneficial interest of separate series
without par value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuations- Securities which are traded on any exchange or on
the NASDAQ over-the-counter market are valued at the last quoted sale price.
Lacking a last sale price, a security is valued at its last bid price except
when, in the Adviser's opinion, the last bid price does not accurately reflect
the current value of the security. All other securities for which
over-the-counter market quotations are readily available are valued at their
last bid price. When market quotations are not readily available, and the
Adviser determines the last bid price does not accurately reflect the current
value or when restricted securities are being valued, such securities are valued
as determined in good faith by the Adviser, in conformity with guidelines
adopted by and subject to review of the Board of Trustees of the Trust (the
"Board").
Fixed income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Adviser believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Adviser,
subject to review of the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
Carl Domino Growth Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes- The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains. For the fiscal year ended October 31, 1999, the Fund did
not qualify as a regulated investment company. Therefore, the Fund was required
to pay taxes in the amount of $7,158. The Fund was reimbursed by the Advisor for
the amount.
Dividends and Distributions- The Fund intends to comply with federal tax rules
regarding distribution of substantially all of its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year.
Other- The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Carl Domino Associates, L.P. (the "Adviser") to
manage the Fund's investments. The Adviser is a limited partnership organized in
Delaware and its general partner is Carl Domino, Inc. The controlling
shareholder of Carl Domino, Inc. is Carl J. Domino. Bruce Honig is primarily
responsible for the day-to-day management of the Fund's portfolio.
Under the terms of the management agreement, (the "Agreement"), the Adviser
manages the Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of the Fund except brokerage commissions, taxes,
interest, fees and expenses of non-interested person trustees, and extraordinary
expenses. As compensation for its management services and agreement to pay the
Fund's expenses, the Fund is obligated to pay the Adviser a fee of 1.50% of the
average daily net assets of the Fund. It should be noted that most investment
companies pay their own operating expenses directly, while the Fund's expenses,
except those specified above, are paid by the Adviser. For the period from
December 31, 1998 (commencement of operations) through October 31, 1999, the
Adviser received a fee of $12,670 from the Fund. The Adviser has voluntarily
agreed to reimburse other expenses to the extent necessary to maintain total
operating expenses at the rate of 1.50%.
Carl Domino Growth Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
For the period December 31, 1998 (commencement of operations) through October
31, 1999, The Advisor reimbursed expenses of $7,739. There is no assurance that
such reimbursement will continue in the future.
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Fund's business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment and
personnel. For the period from December 31, 1998 (commencement of operations) to
October 31, 1999, the Administrator received fees of $12,500 from the Adviser
for administrative services provided to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. ("the Distributor")
to act as the principal distributor of the Fund's shares. There were no payments
made to the Distributor from December 31, 1998 (commencement of operations) to
October 31, 1999. Certain members of management of the Administrator and the
Distributor are also members of management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, there was an unlimited number of authorized shares
for the Fund. Paid in capital at October 31, 1999 was $1,123,485.
Transactions in shares were as follows:
- -------------------------------------------------------------------------------
For the period December 31, 1998 (Commencement of Operations)
to October 31, 1999
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Shares Dollars
- -------------------------------------------------------------------------------
Shares sold 119,405 $1,227,300
- -------------------------------------------------------------------------------
Shares redeemed (10,001) (103,815)
- -------------------------------------------------------------------------------
109,404 $1,123,485
=========== ==========
- -------------------------------------------------------------------------------
Carl Domino Growth Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 5. INVESTMENTS
For the period from December 31, 1998 (commencement of operations) through
October 31, 1999, purchases and sales of investment securities, other than
short-term investments, aggregated $1,379,860 and $271,191, respectively. The
aggregate cost of securities for federal income tax purposes at October 31, 1999
was $11,725,149.
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 7. RELATED PARTY TRANSACTIONS
The Adviser is not a registered broker-dealer of securities and thus does
not receive commissions on trades made on behalf of the Fund. The beneficial
ownership, either directly or indirectly, of more than 25% of the voting
securities of a Fund creates a presumption of control of the Fund, under Section
2(a)(9) of the Investment Company Act of 1940. As of October 31, 1999, Carl
Domino Associates, L.P., and entities which the Adviser could be deemed to
control or have investment discretion over, beneficially owned in aggregate more
than 68% of the Fund.
NOTE 8. RECLASSIFICATIONS
In accordance with SOP 93-2, the fund has recorded a reclassification in
the capital accounts. As of October 31, 1999, the fund recorded permanent
book/tax differences of $8,365 from net investment loss to accumulated
undistributed net realized gains and $77,036 from accumulated unrealized
appreciation on investments to accumulated realized gain. (Due to not qualifying
as a regulated investment company.) This reclassification has no impact on the
net asset value of the fund and is designed generally to present undistributed
income and realized gains on a tax basis which is considered to be more
informative to shareholders.
<PAGE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
Carl Domino Growth Fund
We have audited the accompanying statement of assets and liabilities of the Carl
Domino Growth Fund, including the schedule of portfolio investments, as of
October 31, 1999, and the related statement of operations, the statement of
changes in net assets, and financial highlights, for the period from inception
(December 31, 1998) to October 31, 1999. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Carl Domino Growth Fund as of October 31, 1999, the results of its operations,
the changes in its net assets, and the financial highlights for the initial
period of December 31, 1998 to October 31, 1999, in conformity with generally
accepted accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
<PAGE>
December 1999
Dear Shareholders:
We are pleased to provide the Annual Report and investment results for the Carl
Domino Equity Income Fund. Since inception in December 1995 through October 31,
1999 the Fund has returned an average annual return of 15.8%.
Comparative Investment Last Average
Returns 12 Months Annual Return
- ----------------------------------- ------------ -----------------
Carl Domino Equity Income Fund 11.5% 15.8%
S&P 500 * 25.6% 25.1%
Date Carl Domino Equity Income S&P 500
12/31/95 $ 10,000.00 $ 10,000.00
03/31/96 $ 10,515.00 $ 10,539.00
6/30/96 $ 11,204.78 $ 11,004.82
9/30/96 $ 11,475.94 $ 11,349.27
12/31/96 $ 12,435.33 $ 12,301.48
3/31/97 $ 12,810.88 $ 12,631.16
6/30/97 $ 14,618.49 $ 14,834.03
9/30/97 $ 16,406.33 $ 15,942.13
12/31/97 $ 16,831.26 $ 16,404.46
3/31/98 $ 18,120.53 $ 18,691.24
6/30/98 $ 16,926.39 $ 19,304.31
9/30/98 $ 14,179.23 $ 17,381.60
12/31/98 $ 16,382.69 $ 21,090.84
3/31/99 $ 16,500.64 $ 22,132.72
6/30/99 $ 18,980.69 $ 23,688.65
9/30/99 $ 17,099.70 $ 22,212.85
10/31/99 $ 17,743.27 $ 23,627.81
* Past performance is not predictive of future performance. This chart assumes
an initial investment of $10,000 in the Fund and the S&P 500 Index on December
1, 1995 and held through October 31, 1999. The S&P 500 Index is a widely
recognized unmanaged index of common stock prices. Performance figures include
the change in value of the stocks in the index and reinvestment of dividends.
The decade of the 1990's has been one of exceptional performance by the economy,
corporate America, and the capital markets. During most of this period, the Carl
Domino Associates value/yield investment discipline performed very well,
equaling or outperforming the popular market averages on a risk-adjusted basis.
This period of exceptional performance ended in late 1997 and for the last two
years, we have struggled in a world obsessed by the Internet, high technology
and the .com stocks. A closer look at the recent period reveals a stock market
that is no longer characterized by a broad advance but rather by a very narrow,
highly selective advance of approximately 50 stocks. For example, in 1998, 50
stocks of the S&P 500 Index produced approximately 90% of the return for that
Index. In a similar fashion, 1999 has witnessed a continuation of that trend
with 50 stocks in the Index accounting for all of the return of the Index. The
market leaders of the past two years have been concentrated almost entirely in
technology-an area in which we cannot participate due to our buy and sell
disciplines built around dividend yield.
Within the current environment in which the technology sector has carried the
market to record heights, the question "why have a value allocation in a
portfolio?" needs to be addressed. The answer to this question lies in market
history and it clearly demonstrates that growth and value styles cycle in and
out of favor. Specifically, when growth is in style, value is out of style.
Conversely, when value returns to favor, growth will be out of style. Perhaps
one of the clearest examples of this cycle commenced in the late 1960's with
growth stocks having an extended period of outperformance. By the time growth
stocks peaked in late 1972, price/earnings multiples approached 100 for the
market leaders. The fervor for the 50 stocks which led the market during that
period engendered such names as the "Nifty Fifty," the "Vestal Virgins" and the
"one-decision stocks" to describe this road to riches. Needless to say, in that
era value stocks performed poorly because market mania focused only on the
favored few growth stocks, which led the market to record highs. When the fall
from favor came for these stocks, it lasted two full years and saw several of
the former leaders fall as much as 90% from their previous highs. Despair was so
widespread among growth stock devotees that the theme of the Institutional
Investor Conference in the mid-1970's was simply "Is Growth Dead?" It is
important to note that following this period of the Nifty Fifty, value stocks
outperformed growth stocks for the next 10 years.
History teaches us many lessons if we are willing to learn. In today's
environment, technology stocks are trading at excessively high multiples.
Barron's reported in their December 13th issue that Yahoo is selling for 500
times year 2000 earnings, AOL is selling for 300 times, and the NASDAQ 100 (the
100 largest stocks on the NASDAQ trading system) are selling at a lofty 100
times. Clearly this is market mania with an uncertain life span. It has been
said that markets are controlled by two principal emotions-fear and greed.
Today, it would appear that investor confidence is so high that fear is no
longer part of the market equation, leaving only greed in control of the
markets' destiny. In contrast to technology performance, the rest of the stock
market is suffering from neglect. To illustrate this point, the same Barron's
article pointed out that if technology is removed from the S&P 500 Index, the
remaining stocks are up only 2% for the year-to date. Other measures clearly
indicate the "tale of two markets." For example, 60% of the stocks on the NYSE
have declined at least 20% from their 52-week highs while almost 70% of NASDAQ
stocks are down at least 20% from their highs. In other words, the technology
stocks have succeeded in keeping the popular average at or near their all-time
highs while the rest of the market has been enduring a withering bear market for
the better part of two years.
In all this technology-induced euphoria, there is one universal truth. Market
manias do not last forever; trees do not grow to the sky. One day, market
leadership will undergo a transition from growth back to value. While it is
always difficult, if not impossible, to predict the catalyst which will bring
out such a shift, market history suggests it will probably be some unexpected
event from an unlikely source which will set the wheels in motion. Another
element to keep in mind is simply the passage of time. By some measures, growth
has been the best performing asset class for four or five years while value has
been the worst performing asset class for the last two years. This is an
extraordinarily long period of time for any one style to maintain a pre-eminent
position. Measured by time alone, growth is due for a correction and value is
due for a period of recovery and outperformance.
In fact, from a fundamental perspective, many pieces of the economic puzzle are
beginning to fall into place, which have historically been supportive of value
stocks outperforming growth stocks. First, interest rates have been rising for
14 months and may move higher in 2000. Rising interest rates have normally
presented valuation problems for growth stocks because much of their current
stock prices are based upon distant future earnings. Second, the U.S. economy
continues in its ninth year of expansion with very few, if any, signs of
imbalance which could possibly derail the strong underlying fundamentals.
Importantly, the world economies continue to show renewed growth and give every
indication of a sustainable advance. This worldwide expansion holds the promise
of good earnings growth for U.S. based multi-national companies, many of which
are held in Carl Domino managed portfolios. Lastly, the corporate profit
picture, after an anemic performance in 1998, promises growth of 15-18 % in 1999
and a further 10-14% in 2000. Overall, the broadening out of the economic
expansion combined with a solid earnings outlook for a widening group of
economic sectors and industries is conducive to similar action in the stock
market.
In summary, we at Carl Domino Associates are strongly committed to our
value/yield investment discipline. Our ongoing research efforts continue to
identify reasonably valued stocks with attractive dividend yields, strong
balance sheets, capable management, and very solid earnings outlooks for the
immediate and long-term future. While we recognize there is a temptation for
many to chase the technology stocks and capitulate to the siren call of
seemingly easy profits, we believe that it is more important than ever to
exercise patience and continue to keep Carl Domino Associates and its value
discipline as an integral part of your long range financial plan. While we
cannot say with certainty when the shift from growth to value will happen, there
are many market pundits who believe the turn will come in the New Year. Simply
stated, it's not a question of "if," it is only a question of "when." Be assured
that although we cannot guarantee future results, the investment professionals
at Carl Domino Associates, L.P. will work hard to avoid disappointments and take
advantage of opportunities as they rise.
Best regards,
Carl J. Domino
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Equity Income Fund
Schedule of Investments - October 31, 1999
<S> <C> <C>
Common Stocks - 98.7% Shares Value
BASIC INDUSTRIES - 13.5%
Chemicals - 5.3%
CK Witco Corp. 216 $ 2,023
DuPont (EI) de NeMours 1,459 94,014
International Flavors & Fragrances 4,100 156,825
Rohm & Haas Co. 4,000 153,000
-----------------
-----------------
405,862
-----------------
-----------------
Manufacturers / Diversified - 1.9%
Minnesota Mining & Manufacturing Co. 1,500 142,594
-----------------
-----------------
Manufacturers / Specialized - 4.0%
Federal Signal Corp. 6,465 # 121,623
Pall Corporation 8,500 # 186,469
-----------------
-----------------
308,092
-----------------
-----------------
Paper & Forest Products - 2.3%
Weyerhaeuser Co. 3,000 # 179,062
-----------------
-----------------
TOTAL BASIC INDUSTRIES 1,035,610
-----------------
-----------------
DURABLES - 4.1%
Autos & Auto Parts - 4.1%
American Quantum Cycles Inc. (a) 15,000 40,313
Ford Motor Co. 2,113 115,951
Snap-On, Inc. 5,300 160,987
-----------------
-----------------
317,251
-----------------
-----------------
ENERGY - 11.6%
Oil & Gas - 11.6%
Baker Hughes, Inc. 7,000 195,563
Conoco Inc. - Class B 8,370 227,036
Repsol S.A. (c) 2,400 49,200
Sunoco, Inc. 5,000 120,625
Unocal Corp. 4,500 155,250
USX-Marathon Group 4,800 139,800
-----------------
-----------------
887,474
-----------------
-----------------
FINANCE - 10.0%
Banks - 5.3%
First Union Corp. 3,300 140,869
SouthTrust Corp. 3,650 146,000
Summit Bancorp 3,400 117,725
-----------------
-----------------
404,594
-----------------
-----------------
Insurance - 1.2%
SAFECO Corp. 3,500 96,250
-----------------
-----------------
Carl Domino Equity Income Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
FINANCE - continued
Real Estate Investment Trust - 1.0%
Prison Realty Trust 3,500 $ 35,656
Wyndham International Inc. - Class A (a) 13,500 38,813
-----------------
-----------------
74,469
-----------------
-----------------
Savings & Loans - 2.5%
Community Savings Bankshares, Inc. 15,511 192,918
-----------------
-----------------
TOTAL FINANCE 768,231
-----------------
-----------------
HEALTH - 9.6%
Diversified - 2.0%
American Home Products Corp. 3,000 156,750
-----------------
-----------------
Drugs & Pharmaceuticals - 4.5%
Glaxo Welcome plc (c) 2,900 173,639
Pharmacia & Upjohn, Inc. 3,150 169,903
-----------------
-----------------
343,542
-----------------
-----------------
Managed Care - 0.3%
National Medical Health Card (a) 5,500 22,344
-----------------
-----------------
Medical Equipment & Supplies - 2.8%
Baxter International, Inc. 2,900 188,137
Careside Inc. (a) 4,000 19,750
Careside (Warrants 6/16/2004) (a) 4,000 4,250
-----------------
-----------------
212,137
-----------------
-----------------
TOTAL HEALTH 734,773
-----------------
-----------------
INDUSTRIAL MACHINERY & EQUIPMENT - 6.5%
Electrical Equipment - 2.1%
Thomas & Betts, Inc. 3,650 163,794
-----------------
-----------------
Industrial Machinery & Equipment - 4.4%
Caterpillar, Inc. 2,400 132,750
Tektronix Inc. 5,950 200,812
-----------------
-----------------
333,562
-----------------
-----------------
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 497,356
-----------------
-----------------
Carl Domino Equity Income Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued
MEDIA & LEISURE - 1.2%
Leisure Durables & Toys - 0.9%
Callaway Golf, Inc. 5,000 $ 67,188
-----------------
-----------------
Lodging & Gaming - 0.3%
Cedar Fair, L.P. 1,000 19,937
Interstate Hotels Corp. (a) 566 1,716
-----------------
-----------------
21,653
-----------------
-----------------
TOTAL MEDIA & LEISURE 88,841
-----------------
-----------------
NON-DURABLES - 14.0%
Cosmetics - 2.0%
Avon Products 4,840 156,090
-----------------
-----------------
Foods - 8.6%
General Mills Inc. 1,800 156,938
Heinz (H.J.) 3,300 157,575
Quaker Oats 2,200 154,000
Sara Lee Corp. 7,000 189,437
-----------------
-----------------
657,950
-----------------
-----------------
Household Products - 3.4%
Kimberly-Clark Group 2,400 151,500
Tupperware Corp. 5,600 110,950
-----------------
-----------------
262,450
-----------------
-----------------
TOTAL NON-DURABLES 1,076,490
-----------------
-----------------
RETAIL & WHOLESALE - 3.5%
Department Stores - 3.5%
May Department Stores 4,350 150,891
Penney (J.C.) 4,650 117,994
-----------------
-----------------
268,885
-----------------
-----------------
SERVICES - 5.8%
Miscellaneous Services - 1.7%
Dun & Bradstreet Corp. 4,500 132,187
-----------------
-----------------
Printing - 1.7%
Deluxe Corp. 4,600 129,950
-----------------
-----------------
Carl Domino Equity Income Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued
SERVICES - continued
Services - 2.4%
Block (H&R) 4,000 $ 170,250
GOTO.com Inc. (a) 200 11,400
Innotrac Corp. (a) 500 5,437
-----------------
-----------------
187,087
-----------------
-----------------
TOTAL SERVICES 449,224
-----------------
-----------------
TECHNOLOGY - 5.4%
Communications Equipment - 2.0%
Troy Group, Inc. (a) 500 7,469
Harris Corp. 5,000 112,187
ID Systems Inc. (a) 4,000 19,750
Netro Corp. (a) 500 11,406
-----------------
-----------------
150,812
-----------------
-----------------
Computer Services & Software - 0.3%
ESPS Inc. (a) 5,000 20,000
QUEPASA.COM Inc. (a) 500 3,812
Talk City, Inc. (a) 500 3,625
-----------------
-----------------
27,437
-----------------
-----------------
Electronics - 1.4%
Hypercom Corp.(a) 10,700 85,600
Ultralife Batteries, Inc. (a) 5,000 20,469
-----------------
-----------------
106,069
-----------------
-----------------
Photography & Imaging - 1.7%
Eastman Kodak, Inc. 1,950 134,428
-----------------
-----------------
TOTAL TECHNOLOGY 418,746
-----------------
-----------------
TRANSPORTATION - 1.9%
Shipping - 1.9%
Knightsbridge Tankers Ltd. (c) 5,000 76,875
Statia Terminals Group NV (c) 6,600 67,650
-----------------
-----------------
144,525
-----------------
-----------------
UTILITIES - 11.6%
Electric Utility - 1.8%
Korea Electric Power (c) 8,600 135,450
-----------------
-----------------
Carl Domino Equity Income Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued
UTILITIES - continued
Natural Gas - 7.0%
Midcoast Energy Resources, Inc. 5,500 $ 100,375
El Paso Energy Corp. 6,004 246,914
Williams Companies 5,000 187,500
-----------------
-----------------
534,789
-----------------
-----------------
Telephone Services - 2.8%
AT&T Corp. 3,600 168,300
Telefonica de Argentina (c) 2,000 51,250
-----------------
-----------------
219,550
-----------------
-----------------
TOTAL UTILITIES 889,789
-----------------
-----------------
TOTAL COMMON STOCKS (Cost $7,412,546) 7,577,195
-----------------
-----------------
Preferred Stock - 0.9%
FINANCE - 0.9%
Insurance - 0.9%
Conseco Financial Preferred Series F (Cost $100,000) 2,000 66,125
-----------------
-----------------
Principal
Amount Value
Money Market Securities - 0.4%
Firstar Treasury Fund, 4.41% (b) (Cost $35,272) $ 35,272 35,272
-----------------
-----------------
TOTAL INVESTMENTS - 100.0% (Cost $ 7,547,818) 7,678,592
-----------------
-----------------
Other Assets Less Liabilities - 0.0% 630
-----------------
-----------------
TOTAL NET ASSETS - 100.0% $ 7,679,222
=================
=================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at October
29, 1999.
(c) American Depository Receipt
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Equity Income Fund October 31, 1999
Statement of Assets & Liabilities
<S> <C> <C>
Assets
Investment in securities, at value (cost $7,547,818) $ 7,678,592
Cash 42,416
Receivable for securities sold 9,236
Receivable for fund shares sold 3,503
Dividends receivable 16,525
Interest receivable 253
------------------
Total assets 7,750,525
Liabilities
Accrued investment advisory fee payable $ 9,434
Payable for fund shares redeemed 61,869
-----------------
Total liabilities 71,303
------------------
Net Assets $ 7,679,222
==================
Net Assets consist of:
Paid in capital $ 6,805,024
Accumulated undistributed net investment income 92,603
Accumulated undistributed net realized gain on investments 650,821
Net unrealized appreciation on investments 130,774
------------------
Net Assets, for 476,360 shares $ 7,679,222
==================
Net Asset Value
Net Assets
Offering price and redemption price per share ($7,679,222 / 476,360) $ 16.12
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Equity Income Fund
Statement of Operations for the year ended October 31, 1999
<S> <C> <C>
Investment Income
Dividend income $ 226,366
Interest income 1,909
------------------
Total Income 228,275
Expenses
Investment advisory fee $116,771
Trustees' fees 1,377
---------------
Total expenses before reimbursement 118,148
Reimbursed expenses (1,377)
---------------
Total operating expenses 116,771
------------------
Net Investment Income 111,504
------------------
Realized & Unrealized Gain (Loss)
Net realized gain on investment securities 693,933
Change in net unrealized appreciation (depreciation)
on investment securities (47,202)
---------------
Net gain on investment securities 646,731
------------------
Net increase in net assets resulting from operations $ 758,235
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Equity Income Fund
Statement of Changes in Net Assets
<S> <C> <C>
Year Year
ended ended
October 31, October 31,
1999 1998
----------------- -----------------
Increase (Decrease) in Net Assets
Operations
Net investment income $ 111,504 $ 77,723
Net realized gain (loss) on investment securities 693,933 (14,920)
Change in net unrealized appreciation (depreciation) (47,202) (341,521)
----------------- -----------------
Net increase (decrease) in net assets resulting from operations 758,235 (278,718)
----------------- -----------------
Distributions to shareholders
From net investment income (87,853) (37,359)
From net realized gain - (250,840)
-----------------
----------------- -----------------
Total distributions (87,853) (288,199)
----------------- -----------------
Share Transactions
Net proceeds from sale of shares 1,016,253 4,543,528
Shares issued in reinvestment of distributions 83,004 285,845
Shares redeemed (1,428,177) (675,074)
----------------- -----------------
Net increase (decrease) in net assets resulting
from share transactions (328,920) 4,154,299
----------------- -----------------
Total increase in net assets 341,462 3,587,382
Net Assets
Beginning of period 7,337,760 3,750,378
----------------- -----------------
End of period [including accumulated undistributed net
investment income of $92,603 and $68,952, respectively] $ 7,679,222 $ 7,337,760
================= =================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Equity Income Fund
Financial Highlights
<S> <C> <C> <C> <C>
Period ended
Years ended October 31, October 31,
1999 1998 1997 1996 (a)
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Selected Per Share Data
Net asset value, beginning of period $ 14.68 $ 16.15 $ 12.03 $ 10.00
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Income from investment operations
Net investment income 0.23 0.21 0.19 0.16
Net realized and unrealized gain (loss) 1.38 (0.60) 4.15 1.87
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Total from investment operations 1.61 (0.39) 4.34 2.03
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Less Distributions
From net investment income (0.17) (0.14) (0.22) -
From net realized gain - (0.94) - -
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Total distributions (0.17) (1.08) (0.22) -
---------------- ---------------- ---------------- ----------------
---------------- ---------------- ---------------- ----------------
Net asset value, end of period $ 16.12 $ 14.68 $ 16.15 $ 12.03
================ ================ ================ ================
================ ================ ================ ================
Total Return (b) 11.52% (3.17)% 36.58% 20.30%
Ratios and Supplemental Data
Net assets, end of period (000) $7,679 $7,338 $3,750 $1,122
Ratio of expenses to average net assets 1.50% 1.50% 1.50% 1.51% (c)
Ratio of expenses to average net assets
before reimbursement 1.52% 1.53% 1.55% 1.73% (c)
Ratio of net investment income to
average net assets 1.43% 1.37% 1.28% 1.57% (c)
Ratio of net investment income to
average net assets before reimbursement 1.41% 1.33% 1.22% 1.35% (c)
Portfolio turnover rate 69.92% 75.95% 52.49% 62.51% (c)
(a) December 1, 1995 (commencement of operations) to October 31, 1996
(b) For periods of less than a full year, total returns are not annualized.
(c) Annualized
</TABLE>
<PAGE>
Carl Domino Equity Income Fund
Notes to Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
Carl Domino Equity Income Fund (the "Fund") is organized as a series of the
AmeriPrime Funds, an Ohio business trust (the "Trust"). The Fund is registered
under the Investment Company Act of 1940, as amended, as a diversified series,
open end management investment company. The Fund's investment objective is to
provide long-term growth of capital together with current income. The
Declaration of Trust permits the Trustees to issue an unlimited number of shares
of beneficial interest of separate series without par value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuations- Securities which are traded on any exchange or on
the NASDAQ over-the-counter market are valued at the last quoted sale price.
Lacking a last sale price, a security is valued at its last bid price except
when, in the Adviser's opinion the last bid price does not accurately reflect
the current value of the security. All other securities for which
over-the-counter market quotations are readily available are valued at their
last bid price. When market quotations are not readily available, when the
Adviser determines the last bid price does not accurately reflect the current
value or when restricted securities are being valued, such securities are valued
as determined in good faith by the Adviser, in conformity with guidelines
adopted by and subject to review of the Board of Trustees of the Trust (the
"Board").
Fixed-income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Adviser believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Adviser,
subject to review of the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
Carl Domino Equity Income Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes- The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains.
Dividends and Distributions- The Fund intends to comply with federal tax rules
regarding distribution of substantially all of its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year.
Other- The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Carl Domino Associates, L.P. (the "Adviser") to
manage the Fund's investments. The Adviser is a limited partnership organized in
Delaware and its general partner is Carl Domino, Inc. The controlling
shareholder of Carl Domino, Inc. is Carl Domino. Mr. Domino is primarily
responsible for the day to day management of the Fund's portfolio.
Under the terms of the management agreement, (the "Agreement"), the Adviser
manages the Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of the Fund except brokerage commissions, taxes,
interest, fees and expenses of the non-interested person trustees, and
extraordinary expenses. As compensation for its management services and
agreement to pay the Fund's expenses, the Fund is obligated to pay the Adviser a
fee computed and accrued daily and paid monthly at an annual rate of 1.50% of
the average daily net assets of the Fund. It should be noted that most
investment companies pay their own operating expenses directly, while the Fund's
expenses, except those specified above, are paid by the Adviser. For the year
ended October 31, 1999, the Adviser has received a fee of $116,771 from the
Fund. The Advisor has voluntarily agreed to reimburse other expenses for the
fiscal year ended October 31, 1999 to the extent necessary to maintain total
operating expenses at the rate
Carl Domino Equity Income Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -continued
of 1.50%. For the year ended October 31, 1999, the Advisor reimbursed expenses
of $1,377. There is no assurance that such reimbursement will continue in the
future.
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Fund's business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment and
personnel. For the year ended October 31, 1999, the Administrator received fees
of $30,000 from the Adviser for administrative services provided to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. (the Distributor) to
act as the principal distributor of Fund shares. There were no payments made to
the Distributor for the year ended October 31, 1998. Certain members of
management of the Administrator and the Distributor are also members of
management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, there was an unlimited number of authorized shares
for the Fund. Paid in capital at October 31, 1999 was $6,805,024.
Transactions in shares were as follows:
<TABLE>
- --------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year ended Year ended
October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares Dollars Shares Dollars
- -------------------------------------------------------------------------------------------------------------------------
Shares sold 62,316 $1,016,253 293,838 $4,543,528
- -------------------------------------------------------------------------------------------------------------------------
Shares issued in reinvestment of dividends
5,461 83,004 18,442 285,845
- -------------------------------------------------------------------------------------------------------------------------
Shares redeemed
(91,234) (1,428,177) (44,714) (675,074)
- -------------------------------------------------------------------------------------------------------------------------
(23,457) $(328,920) 267,566 $4,154,299
- -------------------------------------------------------------------------------------------------------------------------
====== ======== ====== ========
</TABLE>
Carl Domino Equity Income Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 5. INVESTMENTS
For the year ended October 31, 1999, purchases and sales of investment
securities, other than short-term investments, aggregated $5,360,768 and
$5,540,855, respectively. The gross unrealized appreciation for all securities
totaled $936,223 and the gross unrealized depreciation for all securities
totaled $805,449 for a net unrealized appreciation of $130,774. The aggregate
cost of securities for federal income tax purposes at October 31, 1999 was
$7,547,818.
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 7. RELATED PARTY TRANSACTIONS
The Adviser is not a registered broker-dealer of securities and thus does
not receive commissions on trades made on behalf of the Funds. The beneficial
ownership, either directly or indirectly, of more than 25% of the voting
securities of a Fund creates a presumption of control of the Fund, under Section
2(a)(9) of the Investment Company Act of 1940. As of October 31, 1999, Carl
Domino Associates, L.P., and entities which the Adviser could be deemed to
control or have investment discretion over, beneficially owned in aggregate more
than 28% of the Fund.
<PAGE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
Carl Domino Equity Income Fund
We have audited the accompanying statement of assets and liabilities of Carl
Domino Equity Income Fund, including the schedule of portfolio investments, as
of October 31, 1999, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and financial highlights for each of the periods indicated.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Carl
Domino Equity Income Fund as of October 31, 1999, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the periods
indicated, in conformity with generally accepted accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
<PAGE>
December 1999
Dear Shareholders:
We are pleased to present the investment results for the Carl Domino
Global Equity Income Fund. Since inception on December 31, 1998 through October
31, 1999 the Fund has returned 16.8%.
Comparative Investment Returns Since Inception
----------------------------------------- ------------------
Carl Domino Global Equity Income Fund 16.8%
S&P 500 12.0%
Date Carl Domino Global - $16,800 S&P - $11,204
December 31, 1998 $10,000.00 $10,000.00
January 31, 1999 $11,070.00 $10,421.00
February 28, 1999 $10,880.00 $10,092.00
March 31, 1999 $11,250.00 $10,495.00
April 30, 1999 $12,160.00 $10,905.00
May 31, 1999 $11,840.00 $10,642.00
June 30, 1999 $12,300.00 $11,233.00
July 31, 1999 $12,020.00 $10,883.00
August 31, 1999 $11,790.00 $10,829.00
September 30, 1999 $11,410.00 $10,533.00
October 31, 1999 $11,670.00 $11,204.00
* Past performance is not predictive of future performance. This chart assumes
an initial investment of $10,000 in the Fund and the S&P 500 Index on December
31, 1998 and held through October 31, 1999. The S&P 500 Index is a widely
recognized unmanaged index of common stock prices. Performance figures include
the change in value of the stocks in the index and reinvestment of dividends,
and are not annualized.
We are pleased with the results. Our holdings in telecommunications,
energy and basic materials contributed significantly to the Fund's performance.
While no one can say what lies ahead of us in 2000, the elements for a growing
global economy are in place. Our goal is to select the best companies on a
worldwide basis. Value is our guideline, supplemented with dividend income. Our
strategy is to have the Fund fully invested. To do otherwise would be "timing
the market", which is a risky approach.
Our second fiscal year has begun. We will maintain a very careful watch
over your assets and do our very best to return reasonable results both on an
absolute basis as well as relative.
Sincerely,
John Wagstaff-Callahan
Senior Portfolio Manager
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the fund; this report is not
authorized for distribution to prospective shareholders unless preceded or
accompanied by an effective prospectus. Read the prospectus carefully before
investing.
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Global Equity Income Fund
Schedule of Investments - October 31, 1999
<S> <C> <C>
Common Stocks - 99.8% Shares Value
BASIC INDUSTRIES - 7.7%
Chemicals - 3.7%
DuPont (EI) de NeMours 176 $ 11,341
Imperial Chem Ind (c) 500 20,094
PPG Industries, Inc. 300 18,188
-----------------
-----------------
49,623
-----------------
-----------------
Manufacturers / Diversified - 1.4%
Minnesota Mining & Manufacturing Co. 200 19,013
-----------------
-----------------
Metals & Mining - 2.6%
Rio Tinto Plc (c) 500 34,000
-----------------
-----------------
TOTAL BASIC INDUSTRIES 102,636
-----------------
-----------------
DURABLES - 5.0%
Autos & Auto Parts - 5.0%
DaimlerChrysler Corp. (c) 200 15,550
Delphi Automotive Systems 1,000 16,437
Ford Motor Co. 200 10,975
Snap-On, Inc. 350 10,631
Volvo AB - Class B (c) 500 12,938
-----------------
-----------------
66,531
-----------------
-----------------
ENERGY - 17.7%
Energy Services - 3.8%
Schlumberger Ltd. 600 36,338
Baker Hughes, Inc. 500 13,969
-----------------
-----------------
50,307
-----------------
-----------------
Oil & Gas - 13.9%
Conoco Inc. - Class B 365 9,900
Elf Aquitaine (c) 300 22,237
ENI Oil s.p.a. Co. 200 11,750
Royal Dutch Petroleum (c) 400 23,975
Shell Transportation & Trading 600 27,525
Texaco, Inc. 200 12,275
TOTAL - Class B (c) 500 33,344
USX-Marathon Group 1,500 43,687
-----------------
-----------------
184,693
-----------------
-----------------
TOTAL ENERGY 235,000
-----------------
-----------------
FINANCE - 11.8%
Banks - 6.8%
Bank of America Corp. 400 25,750
Bank of Ireland (Governor & Co.) (c) 400 12,800
Barclays plc (c) 200 24,100
Chase Manhattan, Inc. 150 13,106
First Union Corp. 350 14,941
-----------------
-----------------
90,697
-----------------
-----------------
Carl Domino Global Equity Income Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
FINANCE - continued
Insurance - 5.0%
AXA-UAP (c) 300 $ 20,925
Hartford Financial Services GRP 400 20,725
ING Group (c) 150 8,869
SAFECO Corp. 550 15,125
-----------------
-----------------
65,644
-----------------
-----------------
TOTAL FINANCE 156,341
-----------------
-----------------
HEALTH - 6.9%
Diversified - 0.8%
American Home Products, Inc. 200 10,450
-----------------
-----------------
Medical Equipment & Supplies - 2.0%
Baxter International, Inc. 400 25,950
-----------------
-----------------
Pharmaceuticals - 4.1%
Glaxo Welcome plc (c) 600 35,925
SmithKline Beecham (c) 300 19,200
-----------------
-----------------
55,125
-----------------
-----------------
TOTAL HEALTH 91,525
-----------------
-----------------
INDUSTRIAL MACHINERY & EQUIPMENT - 5.3%
Electrical Equipment - 2.0%
Thomas & Betts, Inc. 600 26,925
-----------------
-----------------
Industrial Machinery & Equipment - 3.3%
Caterpillar, Inc. 500 27,625
New Holland NV (c) 1,000 15,187
-----------------
-----------------
42,812
-----------------
-----------------
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 69,737
-----------------
-----------------
MEDIA & LEISURE - 4.4%
Entertainment - 1.8%
News Corp. Ltd. (c) 800 23,700
-----------------
-----------------
Lodging & Gaming - 0.8%
Cedar Fair, L.P. 500 9,969
-----------------
-----------------
Publishing - 1.8%
McGraw-Hill Companies 400 23,850
-----------------
-----------------
TOTAL MEDIA & LEISURE 57,519
-----------------
-----------------
Carl Domino Global Equity Income Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued Shares Value
NON-DURABLES - 8.0%
Cosmetics - 1.2%
Avon Products 500 $ 16,125
-----------------
-----------------
Foods - 2.7%
Sara Lee Corp. 1,300 35,181
-----------------
-----------------
Household Products - 3.0%
Kimberly-Clark Group 200 12,625
Unilever PLC (c) 714 26,552
-----------------
-----------------
39,177
-----------------
-----------------
Tobacco - 1.1%
BAT Industries PLC (c) 500 6,969
Philip Morris Cos., Inc. 300 7,556
-----------------
-----------------
14,525
-----------------
-----------------
TOTAL NON-DURABLES 105,008
-----------------
-----------------
RETAIL & WHOLESALE - 1.9%
Department Stores - 1.9%
Penney (J.C.) 1,000 25,375
-----------------
-----------------
SERVICES - 2.7%
Miscellaneous Services - 1.1%
Dun & Bradstreet Corp. 500 14,688
-----------------
-----------------
Services - 1.6%
Block (H&R) 500 21,281
-----------------
-----------------
TOTAL SERVICES 35,969
-----------------
-----------------
TECHNOLOGY - 7.9%
Computer Services & Software - 3.1%
Freeserve PLC (a) (c) 500 11,563
SAP AG (c) 800 29,250
-----------------
-----------------
40,813
-----------------
-----------------
Communication Equipment - 1.2%
Eircom Plc (a) (c) 1,000 16,375
-----------------
-----------------
Electronics - 2.6%
Tektronix Inc. 1,000 33,750
-----------------
-----------------
Photography & Imaging - 1.0%
Eastman Kodak, Inc. 200 13,787
-----------------
-----------------
TOTAL TECHNOLOGY 104,725
-----------------
-----------------
Carl Domino Global Equity Income Fund
Schedule of Investments - October 31, 1999 - continued
Common Stocks - continued
UTILITIES - 20.5%
Electric Utility - 2.2%
Korea Electric Power (c) 500 $ 7,875
Reliant Energy, Inc. 400 10,900
Veba Corp. (c) 200 10,925
-----------------
-----------------
29,700
-----------------
-----------------
Natural Gas - 6.4%
BG plc (c) 500 13,688
El Paso Energy Corp. 800 32,800
Transportadora De Gas (c) 1,500 12,562
Williams Companies 700 26,250
-----------------
-----------------
85,300
-----------------
-----------------
Telephone Services - 11.9%
AT&T Corp. 450 21,038
Bell Atlantic Corp. 200 12,987
British Telecommunication (c) 150 27,000
Global Crossing Ltd. (a) 725 25,103
Nippon Telegraph & Telephone (c) 500 38,687
Telecomm Italia SPA (c) 300 25,950
Versatel International (a) (c) 500 6,313
-----------------
-----------------
157,078
-----------------
-----------------
TOTAL UTILITIES 272,078
-----------------
-----------------
TOTAL COMMON STOCKS (Cost $1,265,339) 1,322,444
-----------------
-----------------
Principal
Amount Value
Money Market Securities - 0.2%
Firstar Treasury Fund, 4.41% (b) (Cost $2,829) $ 2,829 2,829
-----------------
-----------------
TOTAL INVESTMENTS - 100.0% (Cost $1,268,168) 1,325,273
-----------------
-----------------
Other assets less liabilities - 0.0% 210
-----------------
-----------------
TOTAL NET ASSETS - 100.0% $ 1,325,483
=================
=================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at October
29, 1999.
(c) American Depository Receipt
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Global Equity Income Fund October 31, 1999
Statement of Assets & Liabilities
<S> <C> <C>
Assets
Investment in securities, at value (cost $1,268,168) $ 1,325,273
Dividends receivable 1,664
Interest receivable 440
------------------
Total assets 1,327,377
Liabilities
Accrued investment advisory fee payable $ 1,690
Payable to custodian bank 204
-----------------
Total liabilities 1,894
------------------
Net Assets $ 1,325,483
==================
Net Assets consist of:
Paid in capital $ 1,272,889
Accumulated undistributed net investment income 14,817
Accumulated net realized gain (loss) on investments (19,328)
Net unrealized appreciation on investments 57,105
------------------
Net Assets, for 113,489 shares $ 1,325,483
==================
Net Asset Value
Net Assets
Offering price and redemption price per share ($1,325,483 / 113,489) $ 11.68
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Global Equity Income Fund
Statement of Operations for the period December 31, 1998
(Commencement of Operations) to October 31, 1999
<S> <C> <C>
Investment Income
Dividend income $ 27,890
Interest income 2,556
------------------
Total Income 30,446
Expenses
Investment advisory fee $ 15,629
Trustees' fees 571
---------------
Total Expenses before Reimbursement 16,200
Reimbursed expenses (571)
---------------
Total Operating Expenses 15,629
------------------
Net Investment Income 14,817
------------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities (19,328)
Change in net unrealized appreciation (depreciation)
on investment securities 57,105
---------------
Net gain on investment securities 37,777
------------------
Net increase in net assets resulting from operations $ 52,594
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Carl Domino Global Equity Income Fund
Statement of Changes In Net Assets for the period December 31, 1998
(Commencement of Operations) to October 31, 1999
<S> <C>
Increase/(Decrease) in Net Assets
Operations
Net investment income $ 14,817
Net realized gain (loss) on investment securities (19,328)
Change in net unrealized appreciation (depreciation) 57,105
-----------------
Net Increase in net assets resulting from operations 52,594
-----------------
Share Transactions
Net proceeds from sale of shares 1,382,789
Shares redeemed (109,900)
-----------------
Net increase in net assets resulting
from share transactions 1,272,889
-----------------
Total increase in net assets 1,325,483
Net Assets
Beginning of period -
-----------------
End of period [including accumulated undistributed net
investment income of $14,817] $ 1,325,483
=================
</TABLE>
<PAGE>
Carl Domino Global Equity Income Fund
Financial Highlights for the period December 31, 1998
(Commencement of Operations) to October 31, 1999
Selected Per Share Data
Net asset value, beginning of period $ 10.00
----------------
Income from investment operations
Net investment income 0.14
Net realized and unrealized gain (loss) 1.54
----------------
----------------
Total from investment operations 1.68
----------------
Net asset value, end of period $ 11.68
================
Total Return (a) 16.80%
Ratios and Supplemental Data
Net assets, end of period (000) $1,325
Ratio of expenses to average net assets 1.50% (b)
Ratio of expenses to average net assets
before reimbursement 1.55% (b)
Ratio of net investment income to
average net assets 1.42% (b)
Ratio of net investment income to
average net assets before reimbursement 1.37% (b)
Portfolio turnover rate 28.34% (b)
(a) For periods of less than a full year, total returns are not annualized
(b) Annualized
<PAGE>
Carl Domino Global Equity Income Fund
Notes to Financial Statements
October 31, 1999
NOTE 1. ORGANIZATION
Carl Domino Global Equity Income Fund (the "Fund") was organized as a
series of the AmeriPrime Funds, an Ohio business trust (the "Trust), on October
22, 1998 and commenced operations on December 31, 1998. The Fund is registered
under the Investment Company Act of 1940, as amended, as a diversified open-end
management investment company. The Fund's investment objective is to provide
long-term growth of capital together with current income. The Declaration of
Trust permits the Trustees to issue an unlimited number of shares of beneficial
interest of separate series without par value.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuations- Securities which are traded on any exchange or on
the NASDAQ over-the-counter market are valued at the last quoted sale price.
Lacking a last sale price, a security is valued at its last bid price except
when, in the Adviser's opinion, the last bid price does not accurately reflect
the current value of the security. All other securities for which
over-the-counter market quotations are readily available are valued at their
last bid price. When market quotations are not readily available, and the
Adviser determines the last bid price does not accurately reflect the current
value or when restricted securities are being valued, such securities are valued
as determined in good faith by the Adviser, in conformity with guidelines
adopted by and subject to review of the Board of Trustees of the Trust (the
"Board").
Fixed income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Adviser believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. When prices are not readily available from
a pricing service, or when restricted or illiquid securities are being valued,
securities are valued at fair value as determined in good faith by the Adviser,
subject to review of the Board. Short-term investments in fixed-income
securities with maturities of less than 60 days when acquired, or which
subsequently are within 60 days of maturity, are valued by using the amortized
cost method of valuation, which the Board has determined will represent fair
value.
Carl Domino Global Equity Income Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes- The Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains.
Dividends and Distributions- The Fund intends to comply with federal tax rules
regarding distribution of substantially all of its net investment income and
capital gains. These rules may cause multiple distributions during the course of
the year.
Other- The Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over the
life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Carl Domino Associates, L.P. (the "Adviser") to
manage the Fund's investments. The Adviser is a limited partnership organized in
Delaware and its general partner is Carl Domino, Inc. The controlling
shareholder of Carl Domino, Inc. is Carl J. Domino. John Wagstaff-Callahan, a
partner of the Adviser, is primarily responsible for the day-to-day management
of the Fund's portfolio.
Under the terms of the management agreement, (the "Agreement"), the Adviser
manages the Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of the Fund except brokerage commissions, taxes,
interest, fees and expenses of non-interested person trustees, and extraordinary
expenses. As compensation for its management services and agreement to pay the
Fund's expenses, the Fund is obligated to pay the Adviser a fee of 1.50% of the
average daily net assets of the Fund. It should be noted that most investment
companies pay their own operating expenses directly, while the Fund's expenses,
except those specified above, are paid by the Adviser. For the period from
December 31, 1998 (commencement of operations) through October 31, 1999, the
Adviser received a fee of $15,629 from the Fund. The Adviser has voluntarily
agreed to reimburse other expenses to the extent necessary to maintain total
operating expenses at the rate of 1.50%. For the period from December 31, 1998
(commencement of operations) through October 31, 1999, The Advisor reimbursed
expenses of $571. There is no assurance that such reimbursement will continue in
the future.
Carl Domino Global Equity Income Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
The Fund retains AmeriPrime Financial Services, Inc. (the "Administrator")
to manage the Fund's business affairs and provide the Fund with administrative
services, including all regulatory reporting and necessary office equipment and
personnel. For the period from December 31, 1998 (commencement of operations) to
October 31, 1999, the Administrator received fees of $12,500 from the Adviser
for administrative services provided to the Fund.
The Fund retains AmeriPrime Financial Securities, Inc. ("the Distributor")
to act as the principal distributor of the Fund's shares. There were no payments
made to the Distributor from December 31, 1998 (commencement of operations) to
October 31, 1999. Certain members of management of the Administrator and the
Distributor are also members of management of the AmeriPrime Trust.
NOTE 4. SHARE TRANSACTIONS
As of October 31, 1999, there was an unlimited number of authorized shares
for the Fund. Paid in capital at October 31, 1999 was $1,272,889.
Transactions in shares were as follows:
- -------------------------------------------------------------------------------
For the period December 31, 1998 (Commencement of Operations)
to October 31, 1999
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Shares Dollars
- -------------------------------------------------------------------------------
Shares sold 123,489 $1,382,789
- -------------------------------------------------------------------------------
Shares redeemed (10,000) (109,900)
- -------------------------------------------------------------------------------
113,489 $1,272,889
- -------------------------------------------------------------------------------
========== ==========
NOTE 5. INVESTMENTS
For the period from December 31, 1998 (commencement of operations)
through October 31, 1999, purchases and sales of investment securities, other
than short-term investments, aggregated $1,552,289 and $267,623, respectively.
As of October 31, 1999, the gross unrealized appreciation for all securities
totaled $154,354 and the gross unrealized depreciation for all securities
totaled $97,249 for a net unrealized appreciation of $57,105. The aggregate cost
of securities for federal income tax purposes at October 31, 1999 was
$1,268,168. Carl Domino Global Equity Income Fund
Notes to Financial Statements
October 31, 1999 - continued
NOTE 6. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 7. RELATED PARTY TRANSACTIONS
The Adviser is not a registered broker-dealer of securities and thus does
not receive commissions on trades made on behalf of the Fund. The beneficial
ownership, either directly or indirectly, of more than 25% of the voting
securities of a Fund creates a presumption of control of the Fund, under Section
2(a)(9) of the Investment Company Act of 1940. As of October 31, 1999, Carl
Domino Associates, L.P., and entities which the Adviser could be deemed to
control or have investment discretion over, beneficially owned in aggregate 100%
of the Fund.
<PAGE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
Carl Domino Global Equity Income Fund
We have audited the accompanying statement of assets and liabilities of the Carl
Domino Global Equity Income Fund, including the schedule of portfolio
investments, as of October 31, 1999, and the related statement of operations,
the statement of changes in net assets, and financial highlights, for the period
from inception (December 31, 1998) to October 31, 1999. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments and cash held as
of October 31, 1999 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Carl Domino Global Equity Income Fund as of October 31, 1999, the results of its
operations, the changes in its net assets, and the financial highlights for the
initial period of December 31, 1998 to October 31, 1999, in conformity with
generally accepted accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
November 21, 1999
