FLORIDA STREET FUNDS
ADVISOR'S LETTER TO SHAREHOLDERS
DEAR FELLOW SHAREHOLDERS,
Federal Reserve Chairman Alan Greenspan and his colleagues are determined to
economy's breakneck (that is, inflationary) speed before a recessionary accident
becomes unavoidable. Over the past year, the Federal Open Market Committee has
raised the Fed funds rate buy 175 basis points, and other short term rates,
including the bank prime rate, have risen by a similar amount. The Fed's
tightening moves should keep the economy on a path to slower economic growth and
reduced inflationary pressure in the latter half of this year.
During the first months of this calendar year, the various monetary
aggregates have slowed to growth rates between 5.5% and 7.0% on an annual basis.
The consequences of this monetary restriction have been felt in the financial
markets in March and April, but not much yet in the real economy.
The old adage is that monetary policy works with long and variable lags.
Empirical studies show that policy does not usually have an impact until two
quarters after the start of the tightening cycle. Given the offsetting impact of
the Nasdaq's rally last year, it is reasonable to date the beginning of this
tightening cycle in February of this year, when the Fed pushed rates above their
1998 highs. If so, this summer we should see the first evidence that policy is
working.
IN SUMMARY
The disparity in returns between the stock and bond markets has caused many
investors to question the value of diversification. But abandoning a laggard
asset class to chase a winning one is a risky strategy. The return disparity has
not shaken our belief that investors should select and stick with a mixture of
stock, bond and money market funds appropriate to their investment time horizon,
goals, and risk tolerance. Investors should keep their eyes on the horizon and
not let interim turbulence sway them from their course.
Walter A. Morales, CFA
PRESIDENT AND CHIEF INVESTMENT OFFICE
COMMONWEALTH ADVISORS, INC.
FLORIDA STREET BOND FUND
SEMI-ANNUAL REPORT TO SHAREHOLDERS
DEAR FELLOW SHAREHOLDERS,
The six months ended April 30, 2000 was marked by a sharp rise in interest
rates and falling bond prices as surprisingly strong economic growth sparked
fears of higher inflation. In this difficult environment for bond investors, the
Florida Street Bond Fund posted a positive total return of 6.45%. The Merrill
Lynch High Yield Index returned 0.25% while the Bloomberg/EFFAS 7-10 Year U.S.
Government Bond Index managed a small positive return of 1.42%.
The period was marked by a rising inflation rate which fueled fears that the
Federal Reserve would have to maintain it's credit tightening stance for longer
than had been anticipated. The bond market reacted to this scenario by sending
Treasury rates up across short and intermediate maturities. Corporate spreads
widened significantly to compensate for the extra risk bondholders perceived in
the market. At the end of the Fund's prior fiscal year on October 31, 1999, the
five-year U.S. Treasury yield stood at 5.94%. By April 30, 2000 it had risen 60
basis points to 6.54%. The increases were slightly greater at shorter maturities
but less so beyond five years.
--------------------------------------------------------------------------------
Performance Table
Periods Ended April 30, 2000
Since Avg. Ann
6 Months 1 Year Inception Since Inception
Florida St. Bond Fund 6.45% 1.24% 6.20% 2.22%
7-10 Year US Govt Index 1.42% -0.35% 15.13% 5.27%
Merrill Lynch H.Y. Bond Index 0.25% -2.76% 9.57% 3.39%
--------------------------------------------------------------------------------
Florida St ML Hi Yld US Govt
Growth Fd Index 7-10 Yr
08/04/97 10,000 10,000 10,000
08/31/97 9,970 10,014 9,940
09/30/97 10,100 10,194 10,137
10/31/97 10,090 10,246 10,340
11/28/97 10,080 10,338 10,370
12/31/97 10,175 10,419 10,513
01/31/98 10,440 10,607 10,727
02/28/98 10,367 10,668 10,681
03/31/98 10,512 10,777 10,710
04/30/98 10,584 10,818 10,753
05/31/98 10,570 10,949 10,860
06/30/98 10,594 10,950 10,984
07/31/98 10,767 11,058 11,015
08/31/98 10,251 10,388 11,442
09/30/98 10,181 10,507 11,929
10/31/98 10,123 10,348 11,842
11/30/98 10,566 10,886 11,772
12/31/98 10,089 10,866 11,846
01/31/99 10,238 11,013 11,889
02/28/99 10,305 10,938 11,457
03/31/99 10,456 11,065 11,524
04/30/99 10,489 11,268 11,554
05/31/99 10,219 11,164 11,346
06/30/99 10,415 11,137 11,321
07/31/99 10,312 11,152 11,266
08/31/99 10,337 11,034 11,258
09/30/99 10,258 10,990 11,377
10/31/99 9,976 10,930 11,353
11/30/99 10,209 11,072 11,316
12/31/99 10,627 11,139 11,204
01/31/00 10,513 11,097 11,136
02/29/00 10,757 11,120 11,257
03/31/00 10,483 10,957 11,587
04/30/00 10,620 10,957 11,513
The chart shows the value of a hypothetical initial investment of $10,000 in the
Fund, the Merrill Lynch High Yield Bond Index and the Bloomberg/EFFAS 7-10 Year
U.S. Government Bond Index. On August 4, 1997 and held through April 30, 2000.
The Merrill Lynch High Yield Bond Index is a widely recognized unmanaged index
of bonds of lower credit quality. The Bloomberg/EFFAS 7-10 Year U.S. Government
Bond Index is an unmanaged index of intermediate term U.S. Government
securities. Performance figures include the change in value of the bonds in the
indices, reinvestment of interest, 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.
Investors should remember that the high yield bond market is a hybrid market.
Under some conditions, these securities behave like the stock market, especially
small capitalization stocks. At other times, they behave like other bonds. The
Fund experienced a negative trend in its net asset value per share (NAV) during
the six months, however, the high dividend generated by the portfolio of
securities allowed the total return to stay relatively high. The Fund's advisor
has chosen to invest in securities that, on average, are of lower average
quality than the benchmark index. This allows the Fund to generate a higher
level of cashflow due to the greater current yield these securities possess. The
Advisor believes that interest rate cycles cancel themselves out over longer
time periods, and sound analysis and proper diversification will allow the Fund
to generate above-average returns to shareholders. Other factors are encouraging
us view the current environment as a good opportunity to invest in high yield
bonds:
1.When evaluating the Fund's holdings, the downside risk seems small compared to
the opportunities for gains.
2.The erosion in prices has created great value in
these securities. Yield spreads over Treasuries are at high levels and will
eventually narrow. When investors begin to focus on this, as they inevitably
will, prices should recover considerably.
3. We believe most of the negatives
such as the Federal Reserve's policy and the risk of defaults in a slower
economy has already been reflected in current prices. The current risk/reward
tradeoff looks attractive.
As fiscal 2000 progresses we expect the Florida Street Bond Fund to behave as
one would expect in a rising rate environment. Continued pressure could be
placed on NAV, but the high yields of the Fund's holdings should allow the it to
generate a positive total return and perform better than the high quality bond
market. Once the Federal Reserve returns to a neutral stance, the opportunity
for healthy gains is significant.
Thank you for your support.
Sincerely,
Walter A. Morales, CFA
Portfolio Manager
FELLOW SHAREHOLDERS,
During the six months ended April 30, 2000 the Florida Street Growth Fund
achieved exceptional returns, increasing net asset value per share by 53.92%.
This compares with a 21.25% return for the S&P 400 Midcap Index and a 17.25%
return for the S&P 600 Small cap Index. Both indexes surpassed the result of the
S&P 500, which gained 7.89% for the six months. The Fund's twelve-month return
was also strong. For the full fiscal year, net asset value per share (NAV)
increased 55.58% compared to the S&P Midcap's 23.51% return and the S&P
Smallcap's 20.50% gain. What accounted for the Fund's strong gains in fiscal
1999-2000? The stock market continued to be led by the same economic sectors
that have led for the past few years - technology and telecommunications, but an
important shift occurred. Investors finally showed an interest in smaller
capitalization stocks in those sectors. Since the Florida Street Growth Fund is
a multi-cap fund with a focus on mid and small cap stocks, the shift in focus
played into our style. We were able to exploit a few powerful trends in these
sectors to the benefit of our shareholders.
Florida Street S&P 400 S&P 600
Growth Fund Mid-Cap Small-Cap
08/06/97 $10,000 $10,000 $10,000
08/31/97 $9,910 $9,848 $10,240
09/30/97 $10,550 $10,414 $10,917
10/31/97 $10,190 $9,961 $10,446
11/28/97 $10,120 $10,108 $10,337
12/31/97 $10,092 $10,500 $10,579
01/31/98 $9,941 $10,300 $10,373
02/27/98 $10,705 $11,153 $11,317
03/31/98 $11,217 $11,655 $11,749
04/30/98 $11,367 $11,868 $11,818
05/31/98 $10,805 $11,334 $11,192
06/30/98 $10,715 $11,405 $11,224
07/31/98 $10,202 $10,963 $10,366
08/31/98 $8,114 $8,924 $8,368
09/30/98 $8,636 $9,756 $8,879
10/31/98 $9,198 $10,627 $9,291
11/30/98 $9,550 $11,157 $9,813
12/31/98 $10,379 $12,504 $10,439
01/31/99 $10,671 $12,016 $10,307
02/28/99 $9,897 $11,388 $9,379
03/31/99 $9,866 $11,706 $9,500
04/30/99 $10,731 $12,629 $10,127
05/31/99 $10,621 $12,685 $10,374
06/30/99 $11,516 $13,364 $10,964
07/31/99 $11,435 $13,080 $10,868
08/31/99 $10,651 $12,631 $10,390
09/30/99 $10,631 $12,242 $10,434
10/31/99 $11,043 $12,865 $10,408
11/30/99 $12,455 $13,540 $10,848
12/31/99 $14,440 $14,344 $11,734
01/31/00 $14,503 $13,940 $11,370
02/29/00 $18,586 $14,916 $12,893
03/31/00 $18,737 $16,163 $12,416
04/30/00 $16,695 $15,598 $12,203
The chart shows the value of a hypothetical initial investment of $10,000 in the
Fund, the S&P 400 Mid Cap Index and the S&P 600 Small Cap Index on August 6,
1997 and held through April 30, 2000. The S&P 400 Mid Cap Index is a widely
recognized unmanaged index of mid-sized U.S. domestic common stocks. The S&P 600
Small Cap Index is a widely recognized unmanaged index of small U.S. domestic
common stocks. Performance figures include the change in value of the stocks in
the indices, the reinvestment of dividends, and are not annualized for periods
of less than one year. The indices 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.
--------------------------------------------------------------------------------
PERFORMANCE TABLE
Periods Ended April 30, 2000
SINCE AVG. ANN
6 MONTHS 1 YEAR INCEPTION SINCE INCEPTION
Florida St. Growth Fund 57.05% 55.58% 66.95% 20.59%
S&P 400 Mid Cap Index 21.25% 23.51% 55.98% 17.64%
S&P 600 Small Cap Index 17.25% 20.50% 22.03% 7.55%
--------------------------------------------------------------------------------
Note: Past performance does not predict future results.
The most important trend that your management played is the build-out of
optical networks that is occurring as a result of advances in fiber optic
communications. The demand for more bandwidth due to the growth of data traffic
through the telecommunications system is driving this build-out. Companies that
build essential elements of these new networks are experiencing high rates of
growth. We purchased or owned shares of several companies involved in this
industry including Newport Corp., Dycom Industries, Broadcom Corp., II-VI Inc.
and Ciena Corp. The shares of these companies appreciated greatly during the
last six months, helping to propel the Fund's gain. Also contributing to the
strong performance were International Rectifier and Ballard Power, companies
involved in electrical power management. Other contributors include Rare Medium,
Oracle Corp. and Qualcomm Inc. Rare Medium is a web site developer and
consultant to companies wishing to build their e-commerce business. The company
also is an incubator of Internet start-ups. Oracle sells software for enterprise
business applications. It is the second largest supplier behind Microsoft.
Qualcomm is a pioneer in the commercialization of digital wireless transmission
known as CMDA.
As of this writing, the strong rally that has fueled the major stock market
indices for many months has waned. We have felt that the rally was long in the
tooth, and that a significant correction was on the horizon. The Fund's
technology position has been reduced somewhat as additions have been made in
other sectors such as utilities and consumer cyclicals. However, we continue to
believe certain segments of technology will provide superior revenue and
earnings growth, and therefore should be rewarding to investors. The fund is
positioned for a more broadly based market in which other sectors besides
technology serve as market leaders.
We are pleased with the fund's results for the latest year and are striving
to create a unique, multi-capitalization investment vehicle.
Thank you for your support.
Richard Chauvin, Jr.
Portfolio Manager
COMMONWEALTH ADVISORS, INC.
<PAGE>
<TABLE>
<CAPTION>
Florida Street Bond Fund
Schedule of Investments - April 30, 2000 (Unaudited)
<S> <C> <C>
Common Stock - 8.7% Shares Value
American Rice Co. 60,606 $ 484,848
Golden State Bancorp Litigation - Warrants (d) 82,000 84,567
Covad Communications Group, Inc. (b) 3,738 103,729
Firstworld Communication, Inc. (b) 11,653 139,105
Internet Capital Group, Inc. (b) 1,000 42,375
JPS Textile Group, Inc. (b) 18,245 58,156
SFAC New Holdings, Inc. (b) 25 0
PhoneTel Technologies, Inc. (b) 12,044 8,280
Trikon Technologies, Inc. (b) 42,000 593,250
-----------------
-----------------
TOTAL COMMON STOCK (Cost $2,116,744) 1,514,310
-----------------
-----------------
Preferred Stock - 2.9%
Trikon Technologies, Inc. Series H (Cost $296,788) 80,816 505,100
-----------------
-----------------
Principal
Corporate Bonds - 61.1% Amount Value
American Eco Corp. 9.625%, 5/15/08 $ 500,000 127,500
Anacomp, Inc. 10.875%, 4/1/04 520,000 481,000
Brauns Fashions, Inc. 12.00%, 1/1/05 460,000 456,550
Building Materials Corp. 8.00%, 10/15/07 (d) 100,000 85,500
Covad Communications Group, Inc. 0.00%, 3/15/08 (a)(d) 250,000 153,750
DiGiorgio Corp. 10.00%, 6/15/07 100,000 89,000
Dimon, Inc. 8.875%, 6/1/06 175,000 156,564
Firstworld Communications, Inc. 0.00% 4/15/08 1,475,000 671,125
First Plus Home Loan 1997-4 Class B2 8.52%, 9/10/23 (d) 1,200,000 831,000
First Plus Home Loan 1997-2 Class B2 8.54%, 4/10/23 (d) 1,000,000 975,715
Global Star LP 11.25%, 6/15/04 100,000 36,500
Homeland Stores, Inc. 10.00%, 8/1/03 660,000 432,300
Laroche Industries, Inc. 9.50%, 9/15/07 2,500,000 762,500
Loehmanns, Inc. 11.875%, 5/15/03 (c) 1,500,000 337,500
McMillin Cos. LLC 13.00%, 8/31/06 (d) 1,020,000 1,020,000
Mrs. Fields Holdings Co. 14%, 12/1/05 (d) 500,000 217,500
Mrs. Fields Original Cookies, Inc. 10.125%, 12/1/04 350,000 281,750
National Equipment, Inc. 10%, 11/30/04 (c) 150,000 135,750
Oakwood Homes Corp. 7.875%, 3/1/04 140,000 76,300
Packaged Ice, Inc. 9.75%, 2/1/05 1,045,000 851,675
Paging Network, Inc. 13.50%, 6/6/05 200,000 29,500
Phar-Mor, Inc. 11.72%, 9/11/02 125,000 110,000
Ram Energy, Inc. 11.50%, 2/15/08 750,000 373,125
Seagate Technology, Inc. 7.37%, 3/1/07 150,000 131,148
Seagate Technology, Inc. 7.45%, 3/1/37 252,000 218,130
Service Merchandise, Inc. 9.00%, 12/15/04 3,781,000 434,815
SFAC New Holdings, Inc. 0.00%, 6/15/09 (a) 459,770 66,667
Specialty Foods Corp. New Holdings, Inc. 13.25%, 8/15/03 330,000 252,450
Specialty Foods Corp. Sub, Inc. 11.00%, 12/15/09 147,272 -
Florida Street Bond Fund
Schedule of Investments - April 30, 2000 - continued (Unaudited)
Principal
Corporate Bonds - continued Amount Value
United Refining Co. 10.75%, 6/15/07 260,000 $ 157,300
UST, Inc. 7.25%, 6/1/09 15,000 14,221
Western Resources, Inc. 6.25%, 8/15/18 265,000 215,163
Wickes, Inc. 11.625%, 12/15/03 600,000 489,000
-----------------
-----------------
TOTAL CORPORATE BONDS (Cost $14,404,551) 10,670,998
-----------------
-----------------
Convertible Securities - 25.1%
Digital Island, Inc. 6.00%, 2/15/05 650,000 407,062
Internet Capital Group, Inc. 5.50%, 12/21/04 750,000 486,562
PhyCor, Inc. 4.50%, 2/15/03 1,100,000 404,250
Plasma & Materials Technologies, Inc. 7.125%, 10/15/01 (d) 800,000 684,000
U.S. Diagnostic, Inc. 9.00%, 3/31/03 1,135,000 681,000
Vantive Corp. 4.75%, 9/1/02 1,750,000 1,513,750
Vitesse Semiconduct Corp. 4.00%, 3/15/05 (d) 250,000 218,437
-----------------
-----------------
TOTAL CONVERTIBLE BONDS (Cost $4,431,231) 4,395,061
-----------------
-----------------
Municipal Obligations - 2.5%
Mississippi Development Bank Special Obligation
8.50%, 12/1/18 (Cost $456,310) 500,000 431,195
-----------------
-----------------
U.S. Government Obligations - 0.8%
Fannie Mae, Series 93-124, 0.00%, 10/25/22 (Cost $148,807) 256,290 144,031
-----------------
-----------------
TOTAL INVESTMENTS - 101.1% (Cost $21,854,431) 17,660,695
-----------------
-----------------
Liabilities inexcess of other assets - (1.1)% (190,431)
-----------------
-----------------
TOTAL NET ASSETS - 100.0% $ 17,470,264
=================
(a) Security initially issued in zero coupon form which converts to coupon form at a specified
rate and date. The coupon rate shown is the rate at April 30, 2000.
(b) Non-income producing
(c) Non-income producing - issuer is in default or has filed for protection under the Federal Bankruptcy Code.
(d) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities
may be resold in transactions exempt from registration, normally to qualified institutional buyers.
At April 30, 2000 the value of these securities amounted to $4,270,469 or 24.44% of net assets.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Florida Street Bond Fund April 30, 2000
Statement of Assets & Liabilities (Unaudited)
Assets
Investment in securities, at value (cost $21,854,431) $ 17,660,695
Dividend receivable 426
Interest receivable 975,302
Other receivables 35,000
Receivable from broker 85,073
Receivable for securities sold 473,859
Receivable from investment advisor for
reimbursed expenses 33,265
------------------
Total assets 19,263,620
Liabilities
Payable to custodian bank $ 1,281,795
Accrued investment advisory fee payable 12,948
Dividend Payable 3,075
Payable for securities purchased 456,236
Payable for fund shares redeemed 36,128
Trustees' fees accrued 1,992
Miscellaneous expenses 1,182
-----------------
Total liabilities 1,793,356
------------------
Net Assets $ 17,470,264
==================
Net Assets consist of:
Paid in capital $ 23,589,230
Accumulated net investment loss (83,610)
Accumulated net realized gain (loss) on investments (1,841,620)
Net unrealized depreciation on investments (4,193,736)
------------------
Net Assets, for 2,383,632 shares $ 17,470,264
==================
Net Asset Value
Net Assets
Offering price and redemption price per share ($17,470,264 / 2,383,632) $ 7.33
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Florida Street Bond Fund
Statement of Operations for six months period ended April 30, 2000 (Unaudited)
<S> <C> <C>
Investment Income
Dividend income $ 394
Interest income 1,664,024
Miscellaneous income 2,445
---------------
Total Income 1,666,863
Expenses
Investment advisory fee $ 96,424
Trustees fees 1,992
---------------
Total expenses before reimbursement 98,416
Reimbursed expenses (26,245)
---------------
Total operating expenses 72,171
---------------
Net Investment Income 1,594,692
---------------
Realized & Unrealized Gain (Loss)
Net realized loss on investment securities (1,177,798)
Change in net unrealized appreciation
on investment securities 726,071
---------------
Net loss on investment securities (451,727)
---------------
Net increase in net assets resulting from operations $ 1,142,965
===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Florida Street Bond Fund
Statement of Changes in Net Assets
<S> <C> <C>
Six months
ended Year
April 30, ended
2000 October 31,
(Unaudited) 1999
----------------- -----------------
Increase in Net Assets
Operations
Net investment income $ 1,594,692 $ 3,696,985
Net realized loss on investment securities (1,177,798) (663,804)
Change in net unrealized appreciation (depreciation) 726,071 (3,368,296)
----------------- -----------------
Net increase (decrease) in net assets resulting from operations 1,142,965 (335,115)
----------------- -----------------
Distributions to shareholders
From net investment income (1,672,514) (3,688,339)
Return of capital -
From net realized gain - (71,037)
----------------- -----------------
Total distributions (1,672,514) (3,759,376)
----------------- -----------------
Share Transactions
Net proceeds from sale of shares 1,942,911 5,070,098
Shares issued in reinvestment of distributions 1,662,740 3,586,408
Shares redeemed (3,899,698) (6,196,752)
----------------- -----------------
Net increase (decrease) in net assets resulting
from share transactions (294,047) 2,459,754
----------------- -----------------
Total decrease in net assets (823,596) (1,634,737)
Net Assets
Beginning of period 18,293,860 19,928,597
----------------- -----------------
End of period [including accumulated net investment income/ (loss)
of (83,610)and $(5,788), respectively] $ 17,470,264 $ 18,293,860
================= =================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Florida Street Bond Fund
Financial Highlights
<S> <C> <C> <C> <C>
Six months
ended Year Year Period
April 30, ended ended ended
2000 October 31, October 31, October 31,
(Unaudited) 1999 1998 1997 (a)
-------------- --------------- -------------- --------------
Selected Per Share Data
Net asset value, beginning of period $ 7.53 $ 9.16 $ 9.95 $ 10.00
-------------- --------------- -------------- --------------
Income from investment operations
Net investment income 0.69 1.51 0.85 0.21
Net realized and unrealized gain(loss) (0.17) (1.60) (0.79) (0.12)
-------------- --------------- -------------- --------------
Total from investment operations 0.52 (0.09) 0.06 0.09
-------------- --------------- -------------- --------------
Less Distributions
From net investment income (0.72) (1.51) (0.85) (0.02)
From net realized gain(loss) - (0.03) - (0.12)
-------------- --------------- -------------- --------------
Total distributions (0.72) (1.54) (0.85) (0.14)
-------------- --------------- -------------- --------------
-------------- --------------- -------------- --------------
Net asset value, end of period $ 7.33 $ 7.53 $ 9.16 $ 9.95
============== =============== ============== ==============
Total Return (b) 7.03% (1.45)% 0.33% 0.90%
Ratios and Supplemental Data
Net assets, end of period (000) $17,470 $18,294 $19,929 $7,289
Ratio of expenses to average net assets 0.90% (c) 0.75% 0.75% 0.53% (c)
Ratio of expenses to average net assets
before reimbursement 1.23% (c) 1.17% 1.10% 1.10% (c)
Ratio of net investment income to
average net assets 19.97% (c) 17.77% 8.73% 3.95% (c)
Ratio of net investment income to
average net assets before reimbursement 19.64% (c) 17.35% 8.38% 3.38% (c)
Portfolio turnover rate 129.61% (c) 129.38% 10.45% 60.55% (c)
`
(a) For the period August 4, 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>
<TABLE>
<CAPTION>
Florida Street Growth Fund
Schedule of Investments - April 30, 2000 (Unaudited)
<S> <C> <C>
Common Stock - 84.1% Shares Value
CAPITAL EQUIPMENT & SERVICES - 3.3%
Cognex Corp. (a) 800 $ 45,500
General Dynamics Corp. 1,000 58,500
SPX Corp. (a) 400 43,225
Thermo Electron Corp. 1,500 29,156
-----------------
-----------------
176,381
-----------------
-----------------
CONSUMER CYCLICALS - 10.3%
Braun's Fashions Corp. (a) 4,500 102,938
Delphi Automotive Systems, Inc. 2,000 38,250
Lowe's Companies, Inc. 1,500 74,250
Meade Instruments Corp. (a) 500 36,562
Office Depot, Inc. (a) 5,000 53,125
Pacific Sunware of California, Inc. (a) 1,300 44,281
SCP Pool Corp. (a) 1,875 69,023
Tandy Corp. (d) 2,500 142,500
-----------------
-----------------
560,929
-----------------
-----------------
CONSUMER NON-DURABLES & SERVICES - 4.0%
Caliber Learning Network, Inc. (a) 3,200 15,200
Rare Medium Group, Inc. (a) 9,675 198,942
-----------------
-----------------
214,142
-----------------
-----------------
ENERGY - 3.9%
Baker Hughes, Inc. 1,500 47,719
Core Laboratories N.V. (a) 3,000 84,375
Noble Drilling Corp. (a) 2,000 79,875
-----------------
-----------------
211,969
-----------------
-----------------
FINANCIALS - 2.8%
Federated Investors, Inc. - Class B 1,200 33,600
Protective Life Corp. (a) 2,200 52,387
State Street Corp. 700 67,813
-----------------
-----------------
153,800
-----------------
-----------------
HEALTH CARE - 3.1%
Biogen, Inc. (a) 500 29,406
Watson Pharmaceuticals, Inc. (a) 3,100 139,306
-----------------
-----------------
168,712
-----------------
-----------------
NATURAL RESOURCES/ BASIC MATERIALS - 1.9%
Georgia-Pacific Corp. 2,700 62,775
Martin Marietta Materials, Inc. 800 42,400
-----------------
-----------------
105,175
-----------------
-----------------
Florida Street Growth Fund
Schedule of Investments - April 30, 2000 (Unaudited) - continued
Common Stock - continued Shares Value
TECHNOLOGY - 38.3%
Alternative Power - 7.5%
American Power Conversion Corp. (a) 1,400 $ 49,437
American Superconductor Corp. (a) 1,000 38,188
Evercel, Inc. (a) 2,400 37,950
International Rectifier Corp. (a) 3,300 160,875
Mechanical Technology, Inc. (a) 4,500 79,594
Zygo Corp. (a) 1,700 43,350
-----------------
-----------------
409,394
-----------------
-----------------
Data Storage - 4.6%
Cacheflow, Inc. (a) 1,400 103,950
Giga -Tronics, Inc. (a) 1,000 10,875
Procom Technologies, Inc. (a) 1,600 57,600
Tricord Systems, Inc. (a) 1,000 12,500
Veeco Instruments, Inc. (a) 1,000 62,125
-----------------
-----------------
247,050
-----------------
-----------------
Electronics Manufacturing Services - 1.3%
Flextronics International Ltd. (a) 1,000 70,250
-----------------
-----------------
Network Equipment - 1.2%
Methode Electronics, Inc. 1,500 62,508
-----------------
-----------------
Optical Equipment - 3.2%
Bookham Technology PLC (a) (c) 1,500 78,000
II-VI, Inc. (a) 1,700 68,850
Stocker & Yale, Inc. (a) 800 25,300
-----------------
-----------------
172,150
-----------------
-----------------
Semiconductors - 10.3%
Galileo Technology Ltd. (a) 3,000 52,688
National Semiconduct Corp. (a) 2,200 133,650
S3, Inc. (a) 12,000 168,750
Semtech Corp. (a) 700 47,731
Teradyne, Inc. (a) 700 77,000
Trikon Technologies, Inc. (a) 3,000 42,375
Xilinx Inc. (a) 500 36,625
-----------------
-----------------
558,819
-----------------
-----------------
Software - 0.8%
GSV, Inc. (a) 12,000 10,500
PeopleSoft, Inc. (a) 2,500 34,844
-----------------
-----------------
45,344
-----------------
-----------------
Technology Services - 6.3%
Dycom Industries, Inc. 5,625 292,500
Intercept Group, Inc. (a) 1,000 17,250
Unisys Corp. (a) 1,400 32,375
-----------------
-----------------
342,125
-----------------
-----------------
Florida Street Growth Fund
Schedule of Investments - April 30, 2000 (Unaudited) - continued
Common Stock - continued Shares Value
TECHNOLOGY - continued
Telecommunications Equipment - 3.1%
Commscope, Inc. (a) 800 $ 38,150
QUALCOMM, Inc. (a) 1,200 130,125
-----------------
-----------------
168,275
-----------------
-----------------
TOTAL TECHNOLOGY 2,075,915
-----------------
-----------------
TELECOMMUNICATIONS SERVICES - 6.7%
Adelphia Business Solutions, Inc. - Class A (a) 1,500 52,500
Alltel Corp. 900 59,962
Global Grossing Ltd. (a) 1,810 57,015
MCI WorldCom, Inc. (a) 1,350 61,341
Qwest Communications, Inc. (a) 1,500 65,625
Williams Communications Group, Inc. (a) 1,800 66,600
-----------------
-----------------
363,043
-----------------
-----------------
UTILITIES - 9.8%
AES Corp. (a) 600 53,663
Avista Corp. 3,500 103,469
Calpine Corp. (a) 500 45,719
Conectiv, Inc. 5,000 88,750
IdaCorp, Inc. 3,500 129,062
Quanta Services, Inc. (a) 2,400 111,600
-----------------
-----------------
532,263
-----------------
-----------------
TOTAL COMMON STOCKS (Cost $3,627,807) 4,562,329
-----------------
-----------------
Principal
Money Market Securities - 18.8% Amount
Federated Prime Obligations Fund, 6.07% (b)
(Cost $1,022,553) $1,022,553 $ 1,022,553
-----------------
-----------------
TOTAL INVESTMENTS - 102.9% (Cost $4,650,360) 5,584,882
-----------------
-----------------
Other assets less liabilities - (2.9)% (157,728)
-----------------
-----------------
Total Net Assets - 100.0% $ 5,427,154
=================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at April 30, 2000
(c) American Depository Receipt
(d) Name Changed to RadioShack Corp. effective May 31, 2000
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
Florida Street Growth Fund April 30, 2000
Statement of Assets & Liabilities (Unaudited)
Assets
Investment in securities, at value (cost $4,650,360) $ 5,584,882
Dividends receivable 387
Interest receivable 4,356
Receivable for fund shares sold 6,281
Receivable for securities sold 145,163
------------------
Total assets 5,741,069
Liabilities
Payable to custodian bank $ 52
Accrued investment advisory fee 6,210
Other payables 72
Payable for securities purchased 307,581
-----------------
Total liabilities 313,915
------------------
Net Assets $ 5,427,154
==================
Net Assets consist of:
Paid in capital $ 3,253,073
Accumulated net investment loss (21,624)
Accumulated net realized gain (loss) on investments 1,261,183
Net unrealized appreciation on investments 934,522
------------------
Net Assets, for 321,204 shares $ 5,427,154
==================
Net Asset Value
Net Assets
Offering price and redemption price per share ($5,427,154 / 321,204) $ 16.90
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Florida Street Growth Fund
Statement of Operations for the six months ended April 30, 2000 (Unaudited)
<S> <C> <C>
Investment Income
Dividend income $ 6,557
Interest income 6,880
---------------
Total Income 13,437
Expenses
Investment advisory fee $ 33,658
Trustees' fees 1,799
---------------
Total expenses before reimbursement 35,457
Reimbursed expenses (1,727)
---------------
Total operating expenses 33,730
---------------
Net Investment Income (Loss) (20,293)
---------------
Realized & Unrealized Gain (Loss)
Net realized gain on investment securities 1,669,306
Change in net unrealized appreciation (depreciation)
on investment securities 260,958
---------------
Net gain on investment securities 1,930,264
---------------
Net increase in net assets resulting from operations $ 1,909,971
===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Florida Street Growth Fund
Statement of Changes in Net Assets
<S> <C> <C>
Six months
ended Year
April 30 ended
2000 October 31,
(Unaudited) 1999
----------------- -----------------
Increase in Net Assets
Operations
Net investment loss $ (20,293) $ (15,287)
Net realized gain (loss) on investment securities 1,669,306 (106,021)
Change in net unrealized appreciation 260,958 787,262
----------------- -----------------
Net increase in net assets resulting from operations 1,909,971 665,954
----------------- -----------------
Distributions to shareholders
From net investment income 0 (6,024)
Return of capital 0 0
From net realized gain 0 0
----------------- -----------------
----------------- -----------------
Total Distributions 0 (6,024)
----------------- -----------------
Share Transactions
Net proceeds from sale of shares 28,227 1,232,745
Shares issued in reinvestment of distributions 0 6,024
Shares redeemed (113,763) (1,615,951)
----------------- -----------------
Net decrease in net assets resulting
from share transactions (85,536) (377,182)
----------------- -----------------
Total increase in net assets 1,824,435 282,748
Net Assets
Begining of period 3,602,719 3,319,971
----------------- -----------------
End of period [including accumulated net
investment loss of $(21,624) and $(1,331)] $ 5,427,154 $ 3,602,719
================= =================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Florida Street Growth Fund
Financial Highlights
<S> <C> <C> <C> <C>
Six months
ended Year Year Period
April 30 ended ended ended
2000 October 31, October 31, October 31,
(Unaudited) 1999 1998 1997 (a)
-------------- --------------- --------------- --------------
Selected Per Share Data
Net asset value, beginning of period $ 10.98 $ 9.16 $ 10.19 $ 10.00
-------------- --------------- --------------- --------------
Income from investment operations
Net investment income (loss) (0.06) (0.04) 0.02 0.03
Net realized and unrealized gain (loss) 5.98 1.88 (1.01) 0.16
-------------- --------------- --------------- --------------
Total from investment operations 5.92 1.84 (0.99) 0.19
-------------- --------------- --------------- --------------
Less Distributions
From net investment income 0.00 (0.02) (0.01) 0.00
From net realized gain (loss) 0.00 0.00 (0.03) 0.00
-------------- --------------- --------------- --------------
Total Distributions 0.00 (0.02) (0.04) 0.00
-------------- --------------- --------------- --------------
Net asset value, end of period $ 16.90 $ 10.98 $ 9.16 $ 10.19
============== =============== =============== ==============
Total Return (b) 53.92% 20.06% (9.73)% 1.90%
Ratios and Supplemental Data
Net assets, end of period (000) $5,427 $3,603 $3,320 $2,117
Ratio of expenses to average net assets 1.35% (c) 1.35% 1.25% 1.35% (c)
Ratio of expenses to average net assets
before reimbursement 1.42% (c) 1.38% 1.35% 1.35% (c)
Ratio of net investment income (loss) to (0.81)(c) (0.40)% 0.21% 1.14% (c)
average net assets
Ratio of net investment income (loss) to
average net assets before reimbursement (0.88)(c) (0.43)% 0.12% 1.14% (c)
Portfolio turnover rate 157.59% (c) 111.97% 63.10% 0.87% (c)
(a) August 6, 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>
FLORIDA STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (UNAUDITED)
NOTE 1. ORGANIZATION
Florida Street Bond Fund (the "Bond Fund") and Florida Street Growth Fund
(the "Growth Fund") were organized as series of the AmeriPrime Funds, an Ohio
business trust (the "Trust") on June 10, 1997 and commenced operations on June
10, 1997. The Trust is an open-end investment company established under the laws
of Ohio by an Agreement and Declaration of Trust dated August 8, 1995. Each Fund
is registered under the Investment Company Act of 1940, as amended, as a
non-diversified series, open-end management investment company. Each Fund's
investment objective is to provide total return over the long term. 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, 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 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.
FLORIDA STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (UNAUDITED) - CONTINUED
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
FEDERAL INCOME TAXES- Each Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, each 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 Bond Fund intends to declare substantially all
of its net investment income as dividends to its shareholders on a daily basis
and to pay such dividends monthly. The Growth 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- Each 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. Generally accepted accounting principles
require that permanent financial reporting tax differences relating to
shareholder distributions be reclassified to paid in capital for the Growth
Fund.
NOTE 3. OPERATING POLICIES
RESTRICTED SECURITIES- The Funds are permitted to invest in securities that are
subject to legal or contractual restrictions on resale. These securities
generally may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult. Information regarding restricted securities
is included at the end of each applicable fund's schedule of investments.
SHORT SALES- A Fund may sell a security it does not own in anticipation of a
decline in the fair value of that security. When a Fund sells a security short,
it must borrow the security sold short and deliver it to the broker-dealer
through which it made the short sale as collateral for its obligation to deliver
the security upon conclusion of the sale. A gain, limited to the price at which
the Funds sold the security short, or a loss, unlimited in size, will be
recognized upon the termination of a short sale.
FLORIDA STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (UNAUDITED) - CONTINUED
NOTE 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Funds retain Commonwealth Advisors, Inc. (the "Advisor") to manage each
Fund's investments. Walter A. Morales, the Advisor's president and chief
investment manager, is responsible for the day to day management of the Bond
Fund; Richard L. Chauvin, Senior Vice-President of the Advisor is responsible
for the day to day management of the Growth Fund.
Under the terms of the management agreement (the "Agreement"), the Advisor
manages each Fund's investments subject to approval of the Board of Trustees and
pays all of the expenses of each Fund except brokerage commissions, taxes,
borrowing costs (such as (a) interest and (b) dividend expenses on securities
sold short), fees and expenses of non-interested person trustees, and
extraordinary expenses. As compensation for its management services and
agreement to pay each Fund's expenses, the Funds are obligated to pay the
Advisor a fee computed and accrued daily and paid monthly at an annual rate of
1.10% and 1.35% of the average daily net assets of the Bond Fund and the Growth
Fund, respectively. It should be noted that most investment companies pay their
own operating expenses directly, while the Funds' expenses, except those
specified above, are paid by the Advisor. For the six months ended April 30,
2000 the Advisor received fees of $87,837 and $33,658 from the Bond Fund and the
Growth Fund, respectively.
Each Fund retains AmeriPrime Financial Services, Inc. (the
"Administrator"), a wholly owned subsidiary of Unified Financial Services, Inc.,
to manage each Fund's business affairs and to provide each Fund with
administrative services, including all regulatory reporting and necessary office
equipment and personnel. The Administrator receives a monthly fee from the
Advisor equal to an annual rate of 0.10% of the Fund's assets under $50 million,
0.075% of the Fund's assets from $50 million to $100 million, and 0.050% of the
Fund's assets over $100 million (subject to a minimum fee of $2,500 per month).
For the six months ended April 30, 2000 the Administrator received fees of
$8,805 and $6,000 from the Advisor for administrative services provided to the
Bond Fund and the Growth Fund, respectively.
The Fund retains Unified Fund Services, Inc. ("Unified"), a wholly owned
subsidiary of Unified Financial Services, Inc., to act as the Fund's transfer
agent and fund accountant. For its services as transfer agent, Unified receives
a monthly fee from the Advisor of $1.20 per shareholder (subject to a minimum
monthly fee of $750). For the six months ended April 30, 2000, Unified received
fees of $2,411 and $2,413 from the Advisor for transfer agent services provided
to the Bond Fund and the Growth Fund, respectively. For its services as fund
accountant, Unified receives an annual fee from the Advisor equal to 0.0275% of
the Fund's assets up to $100 million, and 0.0250% of the Fund's assets from $100
million to $300 million, and 0.0200% of the Fund's assets over $300 million
(subject to various monthly minimum fees, the maximum being $2,000 per month for
assets of $20
FLORIDA STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (UNAUDITED) - CONTINUED
NOTE 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
to $100 million). For the six months ended April 30, 2000, Unified received fees
of $10,200 and $5,700 from the Advisor for fund accounting services provided to
the Bond Fund and the Growth Fund, respectively.
Each Fund retains AmeriPrime Financial Securities, Inc. (the
"Distributor"), a wholly owned subsidiary of Unified Financial Services, Inc.,
to act as the principal distributor of each Fund's shares. There were no
payments made to the Distributor for the six months period ended April 30, 2000.
Certain members of management of the Administrator and the Distributor are also
members of management of the AmeriPrime Trust.
NOTE 5. SHARE TRANSACTIONS
BOND FUND. As of April 30, 2000, there was an unlimited number of
authorized shares for the Fund. Paid in capital at April 30, 2000 was
$23,589,230.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, 1999
<S> <C> <C> <C> <C>
SHARES DOLLARS SHARES DOLLARS
Shares sold 257,307 $1,942,911 574,601 $5,070,098
Shares issued in
reinvestment of dividends 220,960 1,662,740 416,536 3,586,408
Shares redeemed (523,829) (3,899,698) (737,701) (6,196,752)
--------- ----------- --------- -----------
(45,562) $(294,047) 253,436 $2,459,754
========= =========== ========= ============
</TABLE>
FLORIDA STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (UNAUDITED) - CONTINUED
NOTE 5. SHARE TRANSACTIONS - CONTINUED
GROWTH FUND. As of April 30, 2000, there was an unlimited number of
authorized shares for the Fund. Paid in capital at April 30, 2000 was
$3,253,073.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
SIX MONTH ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, 1999
<S> <C> <C> <C> <C>
SHARES DOLLARS SHARES DOLLARS
Shares sold 1,660 $28,227 119,466 $1,232,745
Shares issued in
reinvestment of dividends 0 0 593 6,024
Shares redeemed (8,658) (113,763) (154,419) (1,615,951)
------- --------- --------- -----------
(6,998) $(85,536) (34,360) $(377,182)
======= ========= ========= ===========
</TABLE>
NOTE 6. INVESTMENTS
BOND FUND. For the six months period ended April 30, 2000, purchases and sales
of investment securities, other than short-term investments, aggregated
$10,895,167 and $11,340,055, respectively. The gross unrealized appreciation for
all securities totaled $648,456 and the gross unrealized depreciation for all
securities totaled $4,842,188 for a net unrealized depreciation of $4,193,736.
The aggregate cost of securities for federal income tax purposes at April 30,
2000 was $21,854,431.
GROWTH FUND. For the six months ended April 30, 2000, purchases and sales of
investment securities, other than short-term investments, aggregated $3,582,076
and $4,182,418, respectively. The gross unrealized appreciation for all
securities totaled $1,160,607 and the gross unrealized depreciation for all
securities totaled $226,085 for a net unrealized appreciation of $934,522. The
aggregate cost of securities for federal income tax purposes at April 30, 2000
was $4,650,360.
FLORIDA STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (UNAUDITED) - CONTINUED
NOTE 7. 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. 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 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 April 30, 2000, Charles
Schwab & Co. owned of record in aggregate more than 97% and 95% of the Bond Fund
and the Growth Fund, respectively.
