JWB AGGRESSIVE GROWTH FUND
Shareholders Report
Dear Shareholders,
The year ending December 31, 1998, proved to be a volatile year for the fund. We
believe using the same diligent fundamental analysis to purchase only the most
well managed companies in the market, which show strong future growth patterns
relative to the companies current price, will hopefully allow us to repeat 1997
results in 1999 (which was a banner year for the fund). In 1999, we will be
increasing our efforts to market the Fund in light of our great return.
This year's economy appears to be comparable to last year's economy, with the
exception of a volatile bond market crushing the markets sporadically throughout
1999. The American economy's pace should not slow down significantly, due to
Asian economic problems (at least for the first 3 quarters of the year). We
expect earnings to stay strong for companies who manage their debt and have no
more than 10% of their business dealings in Asia to lead the market, and thus
pull the markets in an upward swing (while the weekly markets exhibit
schizophrenic volatility). This all means - we should be fine for the first
three quarters.
We would like to give thanks to the shareholders for their commitment and belief
in the Fund and hope you will benefit from our hard work and diligence in the
future.
Sincerely,
/s/ John W. Bagwell
____________________________________
John W. Bagwell, CEO & Trustee
JWB Aggressive Growth Fund
February 26, 1998
<PAGE>
JWB Aggressive Growth Fund
Schedule of Investments
December 31, 1998
- -----------------------------------------------------------------------------
Shares/Principal Amount Market Value % of Assets
- -----------------------------------------------------------------------------
Aircraft
280 Gulfstream Aerospace Corp * 14,910 4.48%
Aircraft & Parts
100 Allied Signal 4,431 1.33%
Ammunition, Except for Small Arms
372 Safety & Components * 5,906 1.77%
Computer Peripheral Equipment, Nec
315 Zebra Technologies Corp Cl A * 9,056 2.72%
Help Supply Services
100 Manpower Inc. 2,519 0.76%
Hospital and Medical Service Plans
100 Trigon Healthcare Inc * 3,731 1.12%
Information Retrieval Services
100 CMG Info Systems * 10,650
100 Yahoo * 23,694
---------
34,344 10.31%
National Commercial Banks
375 City National 15,609 4.69%
Perfumes, Cosmetics, and Other Toilet Preparations
100 Procter & Gamble Co. 9,131 2.74%
Petroleum Refining
132 BP/Amoco Plc 12,075
200 Mobil Corp. 17,425
---------
29,500 8.86%
Pharmaceutical Preparations
300 Schering-Plough Corp. 16,575 4.98%
Photographic Equipment and Supplies
125 Eastman Kodak Co. 9,000 2.70%
Prepackaged Software
400 Oracle Corp. * 17,250 5.18%
Semiconductors and Related Devices
100 Novellus Systems Inc. * 4,950 1.49%
Soaps and Other Detergents
100 Colgate-Palmolive Co. 9,288 2.79%
* Non-Income producing securities.
The accompanying notes are an integral part of the financial statements.
<PAGE>
JWB Aggressive Growth Fund
Schedule of Investments
December 31, 1998
- -----------------------------------------------------------------------------
Shares/Principal Amount Market Value % of Assets
- -----------------------------------------------------------------------------
Stationery Stores
100 Office Max * 1,225 0.37%
Telephone Communications
100 American Telephone & Telegraph 7,525
300 Bellsouth Corp. 14,962
150 U.S. West Inc. 9,694
---------
32,181 9.66%
Transportation Equipment and Supplies
300 Shell Transport & Trading Plc 11,156 3.35%
No Classification
100 Anika Research * 538
600 Suburban Lodges * 4,913
100 Tekelac * 1,656
---------
7,107 2.13%
Cash and Equivalents
6,480 Bank of Boston 6,480 1.95%
Total Investments (cost 173,398) 244,349 73.38%
Other Assets Less Liabilities 88,642 26.62%
Net Assets - Equivalent to $9.24 per share on 332,991 100.00%
* Non-Income producing securities.
The accompanying notes are an integral part of the financial statements.
<PAGE>
Statement of Assets and Liabilities
December 31, 1998
Assets:
Investment Securities at Market Value $244,349
(Identified Cost - 173,398)
Cash -
Receivables:
Investment Securities Sold 3,955
Dividends and Interest 54
From Advisor 83,399
Organization Costs (Net) 8,727
---------
Total Assets 340,484
Liabilities
Payables:
Investment Securities Purchased -
Shareholder Distributions -
Accrued Expenses 7,493
---------
Total Liabilities 7,493
Net Assets $332,991
Net Assets Consist of:
Capital Paid In 315,933
Accumulated Realized Gain (Loss)
on Investments - Net (53,893)
Unrealized Appreciation in Value
of Investments Based on
Identified Cost - Net 70,951
---------
Net Assets, for 36,020 Shares Outstanding $332,991
Net Asset Value and Redemption Price
Per Share ($332,991/36,020 shares) 9.24
Offering Price Per Share 9.24
The accompanying notes are an integral part of the financial statements.
<PAGE>
Statement of Operations
For year ending December 31, 1998
Investment Income:
Dividends 2,521
Interest 3,239
---------
Total Investment Income 5,760
Expenses
Management fees 3,548
Transfer agent fees 18,198
Accounting fees 19,250
Distribution fees 18,292
Legal fees 21,097
Custody fees 3,025
Registration fees 5,000
Organizational expenses 3,906
Audit fees 9,000
Administrative fees 3,193
Miscellaneous expenses 2,351
---------
Total Expenses 106,860
Reimbursed Fees (98,639)
---------
Total Expenses after Reimbursements 8,221
Net Investment Income (2,461)
Realized and Unrealized Gain (Loss) on Investments:
Realized Gain (Loss) on Investments (53,927)
Unrealized Gain (Loss) from Appreciation
(Depreciation) on Investments 47,532
---------
Net Realized and Unrealized Gain (Loss) on
Investments (6,395)
Net Increase (Decrease) in Net Assets from
Operations (8,856)
The accompanying notes are an integral part of the financial statements.
<PAGE>
Statement of Changes in Net Assets
1/1/98 1/1/97
to to
12/31/98 12/31/97
-------- --------
From Operations:
Net Investment Income (2,461) (4,223)
Net Realized Gain (Loss) on Investments (53,927) 125,060
Net Unrealized Appreciation (Depreciation) 47,532 6,890
------- -------
Increase (Decrease) in Net Assets from Operations (8,856) 127,727
From Distributions to Shareholders
Net Investment Income 0 (105,831)
Net Realized Gain (Loss) from Security Transactions 0 0
------- -------
Net Increase (Decrease) from Distributions 0 (105,831)
From Capital Share Transactions:
Proceeds from shares sold 0 11,000
Proceeds from Reinvestment of Dividends/Capital Gains 0 105,831
Shares redeemed (31,688) (207,426)
------- -------
(31,688) (90,595)
Net Increase in Net Assets (40,544) (68,699)
Net Assets at Beginning of Period 373,535 442,234
Net Assets at End of Period 332,991 373,535
======= =======
The accompanying notes are an integral part of the financial statements.
<PAGE>
Financial Highlights
Selected data for a share of common stock outstanding throughout the period:
1/1/98 1/1/97 3/28/96
to to to
12/31/98 12/31/97 12/31/96
-------- -------- --------
Net Asset Value -
Beginning of Period 9.39 9.42 10.00
Net Investment Income (0.04) (0.11) (0.03)
Net Gains or Losses on Securities
(realized and unrealized) (0.11) 3.78 (0.55)
------ ------ ------
Total from Investment Operations (0.15) 3.67 (0.58)
Dividends
(from net investment income) 0.00 (3.70) 0.00
Distributions (from capital gains) 0.00 0.00 0.00
Return of Capital 0.00 0.00 0.00
------ ------ ------
Total Distributions 0.00 (3.70) 0.00
Net Asset Value -
End of Period 9.24 9.39 9.42
Total Return -1.60% 38.75% -5.80%
Ratios/Supplemental Data
Net Assets - End of Period (Thousands) 333 374 442
Before reimbursements
Ratio of Expenses to Average Net Assets 30.54% 11.17% 8.04%
Ratio of Net Income to Average Net Assets (28.90)% (0.59)% (0.23)%
After reimbursements
Ratio of Expenses to Average Net Assets 2.35% 2.35% 2.35%
Ratio of Net Income to Average Net Assets (0.70)% (0.59)% (0.23)%
Portfolio Turnover Rate 176.97% 44.34% 181.79%
The accompanying notes are an integral part of the financial statements.
<PAGE>
JWB Aggressive Growth Fund
Notes to Financial Statements
December 31, 1998
1.) SIGNIFICANT ACCOUNTING POLICIES
JWB Aggressive Growth Fund (the "Fund") is a, diversified open-end management
investment company that consists of one portfolio. The Fund is organized as a
Massachusetts business trust and is registered under the Investment Company
Act of 1940. The Fund is authorized to issue an unlimited number of shares.
The investment objective of the Fund is capital appreciation. The policies
described below are followed consistently by the Fund in the preparation of
its financial statements in conformity with generally accepted accounting
principles for regulated investment companies. Significant accounting
policies of the Fund are presented below:
SECURITY VALUATION:
The Fund intends to invest in a wide variety of equity and debt securities.
The investments in securities are carried at market value. The market
quotation used for common stocks, including those listed on the NASDAQ
National Market System, is the last sale price on the date on which the
valuation is made or, in the absence of sales, at the closing bid price.
Over-the-counter securities will be valued on the basis of the bid price at
the close of each business day. Short-term investments are valued at
amortized cost, which approximates market. Securities for which market
quotations are not readily available will be valued at fair value as
determined in good faith pursuant to procedures established by the Board of
Directors.
SECURITY TRANSACTION TIMING
Security transactions are recorded on the dates transactions are entered into
(the trade dates). Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Interest income is recorded as earned.
The Fund uses the identified cost basis in computing gain or loss on sale of
investment securities. Discounts and premiums on securities purchased are
amortized over the life of the respective securities.
INCOME TAXES:
It is the Fund's policy to distribute annually, prior to the end of the
calendar year, dividends sufficient to satisfy excise tax requirements of the
Internal Revenue Service. This Internal Revenue Service requirement may
cause an excess of distributions over the book year-end accumulated income.
In addition, it is the Fund's policy to distribute annually, after the end of
the fiscal year, any remaining net investment income and net realized capital
gains.
ESTIMATES:
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
DEFERRED ORANIZATION EXPENSE:
Costs incurred by the Fund in connection with it's organization and initial
registration of shares have been deferred and are being amortized on a
straight line basis over a five year period.
2.) INVESTMENT ADVISORY AGREEMENT
Investment Management Fee: Under the terms of the investment management
agreement, the Advisor has agreed to provide the Fund investment management
services and be responsible for the day to day operations of the Fund. The
Advisor will receive a fee, for the performance of its services at an annual
rate of 1% of average daily net assets. The fee will be accrued daily and
paid monthly. An investment management fee of 3,548 was accrued but none paid
for the period December 31, 1998. The Advisor had agreed to limit the Fund's
expenses to 2.35% of the Fund's average daily net assets. The Advisor
reimbursed the Fund and waived fees and expenses totaling $98,639 for the
year ended December 31, 1998.
<PAGE>
JWB Aggressive Growth Fund
Notes to Financial Statements
December 31, 1998
Administration Fee: The Fund has an administration agreement with JWB
Management Corporation (the "Administrator"), an affiliate of the Advisor, to
provide certain administrative and shareholder services, subject to the
supervision and direction of the Board of Trustees of the Fund. The
Administrator provides or contracts for a variety of services, including
monitoring the financial, accounting and administrative transactions of the
Fund, preparation of materials for meetings of the Board of Trustees,
coordinating the preparation of the semi-annual and annual financial
statements, preparation of tax returns and monitoring compliance procedures
for the Fund. In addition, the Administrator pays for certain expenses borne
by the Fund including the charges and expenses of the transfer agent, legal
expenses, the costs incurred in the preparation and mailing of the Fund's
prospectus and sales and promotional material, and other miscellaneous
expense not borne by the Fund. For these services, the Fund pays the
Administrator a fee, which is calculated daily and paid monthly, equal to an
annual rate of .90% of average daily net assets. An administrative fee of
$3,193 was accrued but none paid for the period ended December 31, 1998.
Certain officers and directors of the Fund are officers and directors of the
Manager.
3.) RELATED PARTY TRANSACTIONS
Certain owners of JWB Investment Advisory & Research, Inc. (the Advisor and
Administrator) are also owners and/or directors of the JWB Aggressive Growth
Fund. These individuals may receive benefits from any management and or
administration fees paid to the Advisor.
As of December 31, 1998, FTC DataLynx Co. owned 37% of the shares and The
First National Bank of Boston owned 39% of the shares. These individuals
were considered control persons as defined under Section 2(1)(9) of the 1940
Act, by virtue of their ownership of more than 25% of the voting securities
of the Fund.
4.) CAPITAL STOCK AND DISTRIBUTION
At December 31, 1998 an indefinite number of shares of capital stock ($.10
par value) were authorized, and paid-in capital amounted to $297,235.
Transactions in common stock were as follows:
Shares sold 0
Shares issued to shareholders in
reinvestment of dividends 0
--------
0
Shares redeemed
(3,851)
--------
Net Increase (Decrease) (3,851)
Shares Outstanding:
Beginning of Period 39,771
--------
End of Period 36,020
========
5.) PURCHASES AND SALES OF SECURITIES
During the year ending December 31, 1998, purchases and sales of investment
securities other than U.S. Government obligations and short-term investments
aggregated $448,764 and $416,879 respectively. Purchases and sales of U.S.
Government obligations aggregated $0 and $0 respectively.
6.) FINANCIAL INSTRUMENTS DISCLOSURE
There are no reportable financial instruments that have any off-balance sheet
risk as of December 31, 1998.
<PAGE>
JWB Aggressive Growth Fund
Notes to Financial Statements
December 31, 1998
7.) SECURITY TRANSACTIONS
For Federal income tax purposes, the cost of investments owned at December
31, 1998 was the same as identified cost.
At December 31, 1998, the composition of unrealized appreciation (the excess
of value over tax cost) and depreciation (the excess of tax cost over value)
was as follows:
Appreciation (Depreciation) Net Appreciation(Depreciation)
------------ -------------- ------------------------------
71,008 (57) 70,951
8.) RECLASSIFICATION OF CAPITAL ACCOUNTS
The Fund has adopted Statement of Position 93-2, Determination, Disclosure
and Financial Statement Presentation of Income, Capital Gain and Return of
Capital Distributions by Investment Companies. As a result of this
statement, the Fund changed the classification of distributions to
shareholders to better disclose the difference between financial statement
amounts and distributions determined in accordance with income tax
regulations. Accordingly, undistributed net investment loss and paid in
capital have adjusted as of December 31, 1998 in the following amounts.
These restatements did not affect net investment income, net realized gain
(loss) or net assets for the year ended December 31, 1998.
Undistributed Net Investment Loss Paid in Capital
--------------------------------- ---------------
5,474 (5,474)
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Directors
JWB Aggressive Growth Fund
We have audited the accompanying statement of assets and liabilities of JWB
Aggressive Growth Fund, including the schedule of portfolio investments, as of
December 31, 1998, and the related statement of operations for the year then
ended, the statement of changes in net assets for the two years then ended, and
financial highlights for each of the two years then ended and the period from
March 28, 1996 (commencement of operations) to December 31, 1996 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
by the custodian as of December 31, 1998 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 JWB
Aggressive Growth Fund as of December 31, 1998, the results of its operations
for the year then ended, the changes in its net assets for the two years then
ended, and the financial highlights for the two years then ended and for the
period from March 28, 1996 (commencement of operations) to December 31, 1996 in
the period then ended, in conformity with generally accepted accounting
principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
January 25, 1999
