ROCKHAVEN ASSET MANAGEMENT
THE RISK MANAGERS
The Rockhaven Fund
The Rockhaven Premier
Dividend Fund
LOGO
SEMI-ANNUAL
FOR THE SIX MONTHS ENDED MARCH 31, 2000
<PAGE>
Dear Investor:
First and foremost, we thank you for your continued support of Rockhaven and our
funds. Recent months have been tumultuous and your vote of confidence is
important to us. All employees here at Rockhaven invest in our funds as well, so
it may help to remember that we are with you each step of the way.
In the last ten years or so, responsibility of your financial future has been
shifted...to you. The most notable landmark of this momentous shift was the
creation of the 401(k) and 403(b) plans in 1981. Previously, almost all
employees participated in defined benefit, or pension plans. As people become
less tied to their jobs, 401(k) plans have proliferated as "portable
retirement". Fewer people begin and end their employment careers with the same
company, so employers have replaced the relatively inflexible pension plan with
retirement benefits that can travel with employees who move on to new positions
at different firms.
While this has definitely bestowed benefits upon you and I, it has made each one
of us more responsible than ever before.
With the rise of personal responsibility over our own retirement assets, we have
been encouraged to learn about the stock market and other investment vehicles.
The proliferation of financial media, including CNBC and the Wall Street
Journal, have helped to create an almost nationwide fascination with stocks.
Individual investors now control 70% of the industry's $20 trillion under
management. Not so long ago, everyone believed professional investors controlled
movements in the market and that their superior knowledge was somehow rational,
and this was comforting. However, in a world of limitless financial data and
daily performance reporting, investors' attitudes and behavior toward
professional money managers has gone from trusted fiduciary to commoditization.
We seem to have created a market with a case of attention deficit disorder... in
today's world, the only money management businesses are the ones with superior
performance. We need to perform well enough to attract new money, well enough to
please our existing shareholders, and well enough to attract and retain talented
employees. While as a professional money manager, it may appear as if we are
nameless, faceless institutions, we in fact have a very real interest in your
success. Not to mention that a good percentage of our net worth is in our own
funds!
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ROCKHAVEN ASSET MANAGEMENT 1 2000 SEMI-ANNUAL REPORT
<PAGE>
As a professional money manager, I have learned a few things in my tenure
over the last 17 years. I have learned to "listen to the market". Take what it
will give you....and don't fight it. Seek to identify what risks it will reward
you for, and more importantly, what risks it won't reward you for. Be in harmony
with the market. That is why we don't market time and we don't make sector bets.
We focus purely on security selection.
I understand that as an investor, you are constantly being pulled in a variety
of different directions. Very few of you invest professionally, as a way to earn
a living. You are too busy pursuing your own endeavors as accountants, doctors,
truck drivers, and so on (if I didn't mention you specifically, I apologize).
Take comfort in the fact that myself and the Rockhaven team are dedicated to
your financial success and each day we are here listening to the market and
accepting the responsibility of your invested assets. We value the opportunity
to do so and your continued confidence is appreciated.
CURRENT ENVIRONMENT
Wealth Effect...What Wealth Effect?
If productivity, can be our savior one quarter, how can it be the villain the
next? Greenspan now warns that greater productivity leads to higher earnings and
higher stock prices. Since stocks are worth more, people will spend more, and
that would create supply shortages, labor shortages, traffic jams, road rage,
ulcers, impotency, and who knows what else. Better to nip this productivity
cancer in the bud than suffer the consequences of prosperity!
* EARNINGS -- For the world's largest economic power experiencing it's
longest economic expansion in history, last quarter's GDP growth of 7.3% is
truly stunning. Yet inflation remains subdued. Companies can't raise
prices, yet they are compelled to pay higher wages and higher costs for
most commodities. Still, the astounding gains in productivity have lead to
first quarter earnings gains for the S&P 500 in excess of 20%. Earnings
continue to be robust.
* INTEREST RATES -- The bond market has reacted to Mr. Greenspan's rate
increase by rallying at the long-end of the curve. The bond market has
factored in another 50 basis point increase, and believes that the Fed is
much closer to the end of its tightening efforts than the beginning. If
this holds true, rates will probably be lower by year-end. Also, the recent
declines in the most speculative corners of the stock market will
definitely cool talk of a wealth effect.
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ROCKHAVEN ASSET MANAGEMENT 2 2000 SEMI-ANNUAL REPORT
<PAGE>
* LIQUIDITY -- During his reign Mr. Greenspan has generally adhered to the
price rule, and that is why we have little or no inflation. He has deviated
from the rule during times of crisis or to avert one (i.e., Mexico, Russia,
Asia, Y2K). Having amply funded the Y2K threat, and with no crisis on the
near-term horizon, we can continue to expect the excess liquidity to be
absorbed.
* SUMMARY -- The first quarter saw the lingering effects of excess liquidity
(strong earnings, and strong cash flows into all things technology) drive
the NASDAQ beyond reason. As the second quarter begins, we are seeing a lot
of the market's excesses being corrected. This is a very healthy process as
long as it is not carried to extremes. If Mr. Greenspan can gradually ease
off the pedal without doing serious damage to the economy, 2000 should
continue to be a year where the economy grows, inflation stays low, and
equity markets post positive returns.
TRACKING PROGRESS
The incredible story of the NASDAQ continues to surprise us all. The market is
being driven, more than ever, by supply and demand. This has always been the
case, but now we're on Internet time. Stocks that have risen on pure demand and
limited supply, with no earnings and miniscule revenues, are now falling from
the weight of excess supply and no demand. See the following tables provided by
Ed Kerschner of PaineWebber.
OLD OLD INDUSTRIALS, OLD NEW INDUSTRIALS AND NEW NEW INDUSTRIAL
(PERCENT CHANGE IN PRICE)
12/31/99 3/10/00 12/31/99
TO 3/10/00 TO 4/12/00 TO 4/12/00
---------- ---------- ----------
Old Old Industrials (21.7)% 22.4% (4.2)%
Old New Industrials 10.8 (9.7) 0.1
New New Industrials 64.2 (42.8) (6.1)
NASDAQ 100 23.7 (20.8) (2.0)
NASDAQ Composite 24.1 (25.3) (7.4)
S&P 500 (5.0) 5.2 (0.1)
DJIA (13.6) 12.0 (3.2)
Merrill Lynch All
Convertible 13.4 (12.6) (0.9)
SOURCE: PAINE WEBBER
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ROCKHAVEN ASSET MANAGEMENT 3 2000 SEMI-ANNUAL REPORT
<PAGE>
OLD AND NEW METRICS OF OLD OLD INDUSTRIALS, OLD NEW INDUSTRIALS AND NEW NEW
INDUSTRIAL
MARCH 10, 2000 APRIL 12, 2000
--------------------------- ---------------------------
PRICE/EARNINGS PRICE/SALES PRICE/EARNINGS PRICE/SALES
-------------- ----------- -------------- -----------
1999 2000 1999 1999 2000 1999
---- ---- ---- ---- ---- ----
Old Old Industrials 12.6x 10.8x 0.6x 15.4x 13.2x 0.7x
Old New Industrials 69.2 54.3 7.3 62.5 49.0 6.6
New New Industrials Nmf Nmf 85.7 Nmf Nmf 49.0
NASDAQ 100 147.1 110.8 11.0 116.5 87.7 8.7
NASDAQ Composite N/A N/A N/A N/A N/A N/A
S&P 500 28.3 24.1 2.1 29.8 25.3 2.2
DJIA 21.9 19.1 1.7 24.5 21.4 1.9
----------
SOURCE: PAINE WEBBER
The convertible market has continued to mirror the NASDAQ, and was up 13.39% as
of March 10th, but is down since that time. As of this writing, convertibles
issued by companies with no credit support have come down hardest.
The funds are constructed to run sector neutral to their respective benchmarks
(the S&P 500 Index for the Rockhaven Fund and the Merrill Lynch All-Convertible
Index for the Rockhaven Premier Dividend Fund). This sector-neutrality helped us
to aptly invested in the sectors which were most successful in the past six
months, primarily technology. By focusing on security selection, we are able to
add value by picking the best names in each sector. The sector neutrality helps
us to participate in the sectors which are working, without being overexposed in
the sectors which are not.
However, as things have turned ugly, our sector-neutrality and disciplined
portfolio construction, as well as the use of convertibles, has allowed us to
hang on to some of our past gains. We have worked hard as a team to limit the
possibilities of a dramatic downside, even if that limits a little of our
upside. We are professionals, and we plan on staying in this game for a long,
long time. If you have the stomach for it, this is still one of the greatest
professions there is. If you don't, there's a lot more to life than the stock
market.
Thank you for your continuing support,
/s/ Christopher Wiles
Christopher Wiles
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ROCKHAVEN ASSET MANAGEMENT 4 2000 SEMI-ANNUAL REPORT
<PAGE>
The Rockhaven Fund
AVERAGE ANNUAL TOTAL RETURN(3)
One Year .....................24.49%
Since Inception (11/3/97) ....17.34%
COMPARISON OF THE CHANGE IN VALUE OF A $10,000INVESTMENT IN THE ROCKHAVEN FUND
VERSUS THE S&P 500 COMPOSITE STOCK PRICE INDEX(1) AND THE S&P/BARRA VALUE FUND
INDEX.(2)
S&P 500 Barra S&P 500 Composite
The Rockhaven Fund Value Fund Index Stock Price Index
------------------ ---------------- -----------------
3 Nov 97 $10,000 $10,000 $10,000
31 Dec 97 9,707 10,335 10,317
31 Mar 98 10,807 11,666 11,430
30 Jun 98 10,543 12,075 11,459
30 Sep 98 9,274 10,831 9,928
31 Dec 98 10,860 13,091 11,604
31 Mar 99 11,127 13,700 11,880
30 Jun 99 11,868 14,619 13,103
30 Sep 99 11,303 13,661 11,842
31 Dec 99 13,558 15,647 12,846
31 Mar 00 $14,697 $12,965 $15,959
----------
PAST PERFORMANCE DOES NOT PREDICT FUTURE PERFORMANCE.
(1) THE S&P 500 COMPOSITE STOCK PRICE IS AN UNMANAGED CAPITALIZATION-WEIGHTED
INDEX INDEX OF 500 STOCKS DESIGNED TO REPRESENT THE BROAD DOMESTIC ECONOMY.
(2) THE S&P/BARRA VALUE IS ANUNMANAGED INDEX PPROXIMATELY INDEX
CAPITALIZATION-WEIGHTED THAT CONTAIA 50% OF THE STOCKS IN THE S&P LOWER 500
PRICE-TO-BOOK RATIOS.
(3) AVERAGE ANNUAL TOTAL RETURN AND GRAPH FOR THE FUND DEPICTS TABLE
PERFORMANCE ASSUMING THE MAXIMUM SALES LOAD HAD BEEN PAID. IF SHARES
PURCHASEAT A BREAKPOINT LESS THAN THE WE'RE LOAD MAXIMUM SALES LOAD OR AT
NAV, RETURNS SHOWN WOULD BE HIGHER. The Rockhaven Premier Dividend Fund
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ROCKHAVEN ASSET MANAGEMENT 5 2000 SEMI-ANNUAL REPORT
<PAGE>
AVERAGE ANNUAL TOTAL RETURN(2)
One Year ........................45.19%
Since Inception (11/3/97) .......29.27%
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE ROCKHAVEN
PREMIER DIVIDEND FUND VERSUS THE MERRILL LYNCH ALL-CONVERTIBLE INDEX.(1)
The Rockhaven Premier Merrill Lynch All
Dividend Fund Convertible Index
------------- -----------------
3 Nov 97 $10,000 $10,000
31 Dec 97
31 Mar 98
30 Jun 98
30 Sep 98 [PLOT POINTS TO COME!]
31 Dec 98
31 Mar 99
30 Jun 99
30 Sep 99
31 Dec 99
31 Mar 00 $18,557 $16,623
----------
PAST PERFORMANCE DOES NOT PREDICT FUTURE PERFORMANCE.
(1) THE VALUATION CALCULATION FOR THE MERRILL LYNCH ALL-CONVERTIBLE INDEX IS
FOR THE PERIOD NOVEMBER 1, 1997 THROUGH MARCH 31, 2000. THIS INDEX INCLUDES
U.S. DOLLAR-DENOMINATED CONVERTIBLES OF $50 MILLION OR MORE IN SIZE, AND
INCORPORATES BOTH TRADITIONAL AND MANDATORY CONVERSION STRUCTURES.
(2) THE AVERAGE ANNUAL TOTAL RETURN TABLE AND GRAPH FOR THE FUND DEPICTS
PERFORMANCE ASSUMING THE MAXIMUM SALES LOAD HAD BEEN PAID. IF SHARES WERE
PURCHASED AT A LOAD BREAKPOINT LESS THAN THE MAXIMUM SALES LOAD OR AT NAV,
RETURNS SHOWN WOULD BE HIGHER.
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ROCKHAVEN ASSET MANAGEMENT 6 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND
Schedule of Investments
AT MARCH 31, 2000
SHARES/
PRINCIPAL COMMON STOCKS &
AMOUNT CONVERTIBLE SECURITIES: 98.74% MARKET VALUE
--------------------------------------------------------------------------------
BASIC MATERIALS: 2.05%
600 E. I. du Pont de Nemours and Company $ 31,725
1,200 Sealed Air Corporation, Cvt. Pfd. $2 Series A 62,325
----------
94,050
----------
CAPITAL GOODS/DIVERSIFIED: 10.83%
500 Corning Incorporated 97,000
700 General Electric Company 108,631
30,000 Oak Industries Inc., Cvt. Bd. 4.875%, 3/1/2008 126,675
60,000 Sanmina Corporation, Cvt. Bd. 4.25%, 5/6/2002 96,975
100,000 Solectron Corporation, Cvt. Bd. 0%, 1/27/20191 67,125
----------
496,406
----------
COMMUNICATION SERVICES: 11.78%
2,500 Amdocs Limited, Cvt. Pfd. 6.75% 155,000
1,200 MediaOne Group, Inc., Cvt. Pfd. 7% 62,400
120,000 NEXTEL Communications, Inc., Cvt. Bd. 5.25%,
1/15/2010 143,550
300 NEXTLINK Communications, Inc., Cvt. Pfd. 6.5% 85,838
90,000 NTL Incorporated, Cvt. Bd. 5.75%, 12/15/2009 92,588
----------
539,376
----------
CONSUMER CYCLICAL: 10.99%
1,700 Automatic Data Processing 82,025
115,000 Costco Companies, Inc., Cvt. Bd. 0%, 8/19/20171 137,425
2,200 Dollar General Corporation, STRYPES 8.5% 84,150
1,550 Ford Motor Company 71,203
30,000 Omnicom Group Inc., Cvt. Bd. 4.25%, 1/3/2007 89,813
700 Wal-Mart Stores, Inc. 38,850
----------
503,466
----------
ENERGY: 5.09%
3,00 Enron Corp., Cvt. Pfd. 7% 66,188
1,324 Exxon Mobil Corporation 103,024
1,300 Shell Transport and Trading ADR 63,781
----------
232,993
----------
FINANCE: 12.09%
700 American International Group, Inc. 76,650
800 Bank of America Corporation 41,950
1,750 Citigroup Inc. 103,796
700 J.P. Morgan & Co., Incorporated 92,225
700 Lehman Brothers Holdings Inc. 67,900
800 Merrill Lynch & Co., Inc. 84,000
1,000 The Chase Manhattan Bank 87,188
----------
553,709
----------
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ROCKHAVEN ASSET MANAGEMENT 7 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND
Schedule of Investments
AT MARCH 31, 2000
SHARES/
PRINCIPAL COMMON STOCKS &
AMOUNT CONVERTIBLE SECURITIES: 98.74% MARKET VALUE
--------------------------------------------------------------------------------
HEALTH CARE: 8.70%
2,000 Abbott Laboratories 70,375
1,000 Bausch & Lomb Incorporated 52,188
900 Bristol-Myers Squibb Company 51,975
70,000 Centocor, Inc., Cvt. Bd. 4.75%, 2/21/2001 77,875
1,900 Monsanto Company, Cvt. Pfd. 6.5% 86,925
70,000 Roche Holdings, Inc., Cvt. Bd. 0%, 1/19/2015(1) 59,238
----------
398,576
----------
STAPLES: 10.49%
60,000 Clear Channel Communications, Inc., Cvt. Bd. 2.625%,
4/1/2003 73,950
500 Houston Industries, Inc./Time Warner, Cvt. Pfd. 7% 79,500
900 The Coca-Cola Company 42,244
1,000 The Estee Lauder Companies Inc., Cvt. Pfd. 6.25% 95,000
1,300 The Quaker Oats Company 78,813
2,000 The Seagram Company Ltd., Cvt. Pfd. ACES 7.5% 111,000
----------
480,507
----------
TECHNOLOGY: 24.32%
60,000 Atmel Corporation, Cvt. Bd. 0%, 4/21/20181 87,750
1,900 Computer Associates International, Inc. 112,455
90,000 Conexant Systems, Inc., Cvt. Bd. 4%, 2/01/2007 82,350
70,000 Juniper Networks, Inc., Cvt. Bd. 4.75%, 3/15/2007 69,825
30,000 Lattice Semiconductor Corporation, Cvt. Bd 4.75%,
11/1/2006 55,050
25,000 Level One Communications, Incorporated, Cvt. Bd. 4%,
9/1/2004 108,530
700 Motorola, Inc. 99,662
130,000 Rational Software Corporation, Cvt. Bd. 5%, 2/5/2003 162,500
900 Texas Instruments, Incorporated 144,000
50,000 VERITAS Software Corporation, Cvt. Bd. 1.856%,
8/1/2006 191,875
----------
1,113,997
==========
UTILITIES: 2.40%
2,000 Calpine Capital Trust II 109,750
----------
Total Common Stocks and Convertible Securities
(cost $3,712,235) $4,522,830
==========
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ROCKHAVEN ASSET MANAGEMENT 8 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND
Schedule of Investments
AT SEPTEMBER 30, 1999
PRINCIPAL
AMOUNT SHORT-TERM INVESTMENTS: 0.58% MARKET VALUE
--------------------------------------------------------------------------------
$7,513 Firstar Stellar Treasury Fund (cost $26,626) $ 26,654
Total Investments in Securities
(cost $3,738,861): 99.32% 4,549,484
Other Assets in Excess of Liabilities: 0.68% 31,197
----------
TOTAL NET ASSETS: 100% $4,580,681
==========
(1) NON-INCOME PRODUCING SECURITY.
GROSS UNREALIZED APPRECIATION AND DEPRECIATION OF SECURITIES IS AS
FOLLOWS:
GROSS UNREALIZED APPRECIATION $ 899,759
GROSS UNREALIZED DEPRECIATION $ (89,136)
----------
NET UNREALIZED APPRECIATION $ 810,623
==========
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ROCKHAVEN ASSET MANAGEMENT 9 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND
Statement of Assets and Liabilities
AT MARCH 31, 2000 (UNAUDITED)
ASSETS
Investments in securities, at value
(identified cost $3,738,861) $4,549,484
Receivables:
Due from Advisor 10,674
Dividends and interest 10,614
Fund shares sold 1,429
Prepaid expenses and other 22,453
----------
Total assets 4,594,654
==========
LIABILITIES
Payables:
Fund shares repurchased 108
Accrued expenses 13,865
----------
Total liabilities 13,973
==========
NET ASSETS $4,580,681
==========
Net asset value and redemption price per share
($4,580,681/308,572 shares outstanding; unlimited
number of shares (par value $0.01) authorized) $ 14.84
==========
Offering price per share ($14.84/0.9425) $ 15.75
==========
COMPONENTS OF NET ASSETS
Paid-in capital $3,434,807
Undistributed net realized gain on investments 335,251
Net unrealized appreciation on investments 810,623
----------
Net assets $4,580,681
==========
See accompanying Notes to Financial Statements.
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ROCKHAVEN ASSET MANAGEMENT 10 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND
Statement of Operations
FOR THE SIX MONTHS ENDED MARCH 31, 2000 (UNAUDITED)
INVESTMENT INCOME
Income
Dividends and Interest $ 31,765
Expenses
Administration fees (Note 3) 15,041
Advisory fees (Note 3) 13,838
Professional fees 12,169
Fund accounting fee 9,026
Transfer agent fees 8,395
Registration fees 5,342
Distribution expense (Note 4) 4,613
Custodian 3,610
Other 1,888
Report to shareholders 1,504
Trustees' fees 1,441
---------
Total expenses 76,867
Less: advisory fee waiver and absorption (49,191)
---------
Net expenses 27,676
---------
Net investment income 4,089
=========
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain from security transactions 351,719
Net change in unrealized appreciation on investments 577,086
---------
Net realized and unrealized gain on investments 928,805
---------
Net Increase in Net Assets Resulting from Operations $ 932,894
=========
See accompanying Notes to Financial Statements.
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ROCKHAVEN ASSET MANAGEMENT 11 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
SIX MONTH ENDED YEAR ENDED
MARCH 31, 2000(2) SEPT. 30, 1999
----------------- --------------
<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS
Net investment income $ 4,089 $ 25,704
Net realized gain from security transactions 351,719 188,976
Net change in unrealized appreciation on investments 577,086 342,499
----------- -----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 932,894 557,179
=========== ===========
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (7,862) (30,220)
Net realized gain on security transactions (81,316) 0
----------- -----------
(89,178) (30,220)
=========== ===========
CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived from net
change in outstanding shares (a) 743,616 475,083
----------- -----------
TOTAL INCREASE IN NET ASSETS 1,587,332 1,002,042
=========== ===========
NET ASSETS
Beginning of period 2,993,349 1,991,307
----------- -----------
END OF PERIOD $ 4,580,681 $ 2,993,349
=========== ===========
</TABLE>
(a) A summary of capital share transactions is as follows:
SIX MONTHS ENDED YEAR ENDED
MARCH 31, 2000(2) SEPT. 30, 1999
------------------------- -------------------------
SHARES PAID IN CAPITAL SHARES PAID IN CAPITAL
------ --------------- ------ ---------------
Shares sold 57,519 $ 819,166 90,975 $ 955,142
Shares issued in
reinvestment of
distributions 5,373 68,608 2,002 23,116
Shares redeemed (9,694) (144,158) (42,733) (503,175)
------ --------- ------ ---------
Net increase 53,198 $ 743,616 50,244 $ 475,083
====== ========= ====== =========
(1) COMMENCEMENT OF OPERATIONS.
(2) UNAUDITED.
See accompanying Notes to Financial Statements.
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ROCKHAVEN ASSET MANAGEMENT 12 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND
Financial Highlights
FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
SIX MONTHS NOV. 3, 1997(1)
ENDED YEAR ENDED THROUGH
MARCH 31, 2000(2) SEPT. 30, 1999 SEPT. 30, 1998
----------------- -------------- --------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 11.72 $ 9.71 $10.00
------- ------- ------
Income from investment operations:
Net investment income 0.03 0.09 0.14
Net realized and unrealized gain
(loss) on investments 3.43 2.03 (0.29)
------- ------- ------
Total from investment operations 3.46 2.12 (0.15)
------- ------- ------
Less distributions:
From net investment income (0.03) (0.11) (0.14)
From net realized gains (0.31) -- --
------- ------- ------
(0.34) (0.11) (0.14)
------- ------- ------
Net asset value, end of period $ 14.84 $ 11.72 $ 9.71
======= ======= ======
Total return 0.03%(3) 21.88% (1.61)%(3)
Ratios/supplemental data:
Net assets, end of period (thousands) $ 4,581 $ 2,993 $1,991
Ratio of expenses to average net assets:
Before expense reimbursement 4.14%(2) 4.59% 8.51%(2)
After expense reimbursement 1.49%(2) 1.50% 1.49%(2)
Ratio of net investment income to
average net assets
After expense reimbursement 0.22%(2) 0.83% 1.82%(2)
Portfolio turnover rate 69.78% 113.36% 98.13%
======= ======= ======
</TABLE>
----------
(1) COMMENCEMENT OF OPERATIONS.
(2) ANNUALIZED.
(3) NOT ANNUALIZED.
(4) UNAUDITED.
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ROCKHAVEN ASSET MANAGEMENT 13 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN PREMIER DIVIDEND FUND
Schedule of Investments
AT MARCH 31, 2000
SHARES/
PRINCIPAL COMMON STOCKS &
AMOUNT CONVERTIBLE SECURITIES: 98.74% MARKET VALUE
--------------------------------------------------------------------------------
BASIC MATERIALS: 4.23%
6,800 Georgia-Pacific Corporation, Cvt. Pfd. $ 291,550
18,200 Sealed Air Corporation, Cvt. Pfd. $2 Series A 945,263
-----------
1,236,813
-----------
CAPITAL GOODS: 11.34%
16,500 Ingersoll-Rand Co., Cvt. Pfd. 6.75% 387,750
300,000 Oak Industries Inc., Cvt. Bd. 4.875%, 3/1/2008 1,266,750
590,000 Sanmina Corporation, Cvt. Bd. 4.75%, 5/1/2004 953,588
1,050,000 Solectron Corporation, Cvt. Bd. 0%, 1/27/20191 704,813
-----------
3,312,901
-----------
COMMUNICATIONS: 18.30%
19,200 Amdocs Limited, Cvt. Pfd. 6.75% 1,190,400
14,200 MediaOne Group, Inc., Cvt. Pfd. 7% 738,400
1,000,000 NEXTEL Communications, Inc., Cvt. Bd. 5.25%,
1/15/2010 1,196,250
3,100 NEXTLINK Communications, Inc., Cvt. Pfd. 6.5% 886,988
650,000 NTL Incorporated, Cvt. Bd. 5.75%, 12/15/2009 668,688
8,500 Qwest Trend Trust 5.75% Cvt. Pfd. 667,250
-----------
5,347,976
-----------
CONSUMER CYCLICAL: 5.76%
700,000 Costco Companies, Inc., Cvt. Bd. 0%, 8/19/20171 836,500
9,500 Dollar General Corporation, Cvt. Pfd. STRYPES 8.5% 363,375
1,694,000 Four Seasons Hotel, Inc., Cvt. Bd. 0%, 9/23/20291 484,907
-----------
1,684,782
-----------
ENERGY: 5.63%
19,400 Apache Corporation, Cvt. Pfd. 6.5% 873,000
35,000 Enron Corp., Cvt. Pfd. 7% 772,187
-----------
1,645,187
-----------
FINANCE: 4.62%
21,800 CNB Capital Trust, Cvt. Pfd. 6% 708,500
31,660 Lincoln National Corporation, Cvt. Pfd. 7.75% 641,115
-----------
1,349,615
-----------
SERVICES: 11.42%
520,000 Clear Channel Communications, Inc., Cvt. Bd.
2.625%, 4/1/2003 640,900
8,100 Cox Communications, Inc., Cvt. Pfd. 7% 514,350
2,950 Houston Industries, Inc./Time Warner, Cvt. Pfd. 7% 469,050
265,000 Omnicom Group Inc., Cvt. Bd. 4.25%, 1/3/2007 793,344
9,900 The Seagram Company Ltd., Cvt. Pfd. ACES 7.5% 549,450
6,700 XM Satellite Radio 8.25% Cvt. Pfd. 370,175
-----------
3,337,269
-----------
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ROCKHAVEN ASSET MANAGEMENT 14 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN PREMIER DIVIDEND FUND
Schedule of Investments
AT MARCH 31, 2000
SHARES/
PRINCIPAL COMMON STOCKS &
AMOUNT CONVERTIBLE SECURITIES: 98.74% MARKET VALUE
--------------------------------------------------------------------------------
STAPLES: 10.55%
590,000 Centocor, Inc., Cvt. Bd. 4.75%, 2/21/2001 $ 656,375
525,000 COR Therapeutics, Inc., Cvt. Bd. 5%, 3/01/2007 652,969
650,000 Elan Finance, Cvt. Bd. 0%, 12/14/20181 465,562
800,000 Roche Holdings, Inc., Cvt. Bd. 0%, 1/19/20151 677,000
6,600 The Estee Lauder Companies Inc., Cvt. Pfd. TRACES
6.25% 627,000
-----------
3,078,906
-----------
TECHNOLOGY: 21.17%
500,000 Citrix Systems, Inc., Cvt. Bd. 0%, 3/2/20191 485,000
550,000 Conexant Systems, Inc., Cvt. Bd. 4%, 2/01/2007 503,250
350,000 Exodus Communications, Inc., Cvt. Bd. 5%, 7/15/2008 721,436
1,000,000 Juniper Networks, Inc., Cvt. Bd. 4.75%, 3/15/2007 997,500
440,000 Lattice Semiconductor Corporation, Cvt. Bd. 4.75%,
11/1/2006 807,400
800,000 Rational Software Corporation, Cvt. Bd. 5%,
2/5/2003 1,000,000
750,000 Semtech Corporation, Cvt. Bd. 4.5%, 2/1/2007 711,563
250,000 VERITAS Software Corporation, Cvt. Bd. 1.86%,
8/13/2006 959,375
-----------
6,185,524
-----------
UTILITIES: 4.34%
5,200 AES Trust III, Cvt. Pfd. 351,000
16,700 Calpine Capital Trust II, Cvt. Pfd. 5.5% 916,412
-----------
1,267,412
-----------
Total Preferred Stocks and Bonds
(cost $24,528,062) $28,446,385
===========
PRINCIPAL
AMOUNT SHORT-TERM INVESTMENTS: 1.43% MARKET VALUE
--------------------------------------------------------------------------------
$ 418,781 Firstar Stellar Treasury Fund (cost $418,781) $ 418,781
-----------
Total Investments in Securities
(cost $24,946,943): 98.79% $28,865,166
Assets in Excess of Liabilities: 1.21% 353,696
-----------
TOTAL NET ASSETS: 100% $29,218,862
===========
(1) NON-INCOME PRODUCING SECURITY.
GROSS UNREALIZED APPRECIATION AND DEPRECIATION OF
SECURITIES IS AS FOLLOWS:
GROSS UNREALIZED APPRECIATION $ 4,404,470
GROSS UNREALIZED DEPRECIATION (486,147)
-----------
NET UNREALIZED APPRECIATION $ 3,918,323
===========
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 15 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN PREMIER DIVIDEND FUND
Statement of Assets and Liabilities
AT MARCH 31, 2000 (UNAUDITED)
ASSETS
Investments in securities, at value
(identified cost $24,946,843) $28,865,166
Receivables:
Dividends and interest 91,409
Fund shares sold 958,793
Prepaid expenses and other 24,854
-----------
Total assets 29,940,222
===========
LIABILITIES
Payables:
Due to advisor 25,326
Dividends 34,865
Fund shares repurchased 115,129
Securities purchased 530,803
Accrued expenses 15,237
-----------
Total liabilities 721,360
===========
NET ASSETS $29,218,862
===========
Net asset value and redemption price per share
($29,218,862/1,581,535 shares outstanding; unlimited number
of shares (par value $0.01) authorized) $ 18.48
===========
Offering price per share ($18.48/0.9425) $ 19.61
===========
COMPONENTS OF NET ASSETS
Paid-in capital $22,680,610
Undistributed net realized gain on investments 2,619,929
Net unrealized appreciation on investments 3,918,323
-----------
Net assets $29,218,862
===========
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 16 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN PREMIER DIVIDEND FUND
Statement of Operations
FOR THE SIX MONTHS ENDED MARCH 31, 2000 (UNAUDITED)
INVESTMENT INCOME
Income
Dividends and interest $ 430,607
EXPENSES
Administration fees (Note 3) 15,041
Advisory fees (Note 3) 67,717
Professional fees 11,637
Fund accounting fee 9,026
Transfer agent fees 8,721
Registration fees 5,276
Distribution expense (Note 4) 22,772
Custodian 2,811
Trustees' fees 1,440
-----------
Total expenses 144,441
Less: advisory fee waiver and absorption (12,264)
-----------
Net expenses 132,177
-----------
Net investment income 298,430
===========
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain from security transactions $ 2,789,063
Net change in unrealized appreciation on investments 3,176,360
-----------
Net realized and unrealized gain on investments 5,965,423
-----------
Net Increase in Net Assets Resulting from Operations $ 6,263,853
===========
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 17 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN PREMIER DIVIDEND FUND
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
MARCH 31, 2000(2) SEPT. 30, 1999
----------------- --------------
<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS
Net investment income $ 298,430 $ 81,811
Net realized gain from security transactions 2,789,063 276,358
Net change in unrealized appreciation
on investments 3,176,360 794,811
------------ -----------
Net increase (decrease) in net assets
resulting from operations 6,263,853 1,152,980
============ ===========
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (299,331) (86,569)
Net realized gain on security transactions (242,032) 0
------------ -----------
(541,363) (86,569)
============ ===========
CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived
from net change in outstanding shares (a) 14,759,021 5,992,141
------------ -----------
Total increase in net assets 20,481,511 7,058,552
============ ===========
NET ASSETS
Beginning of period 8,737,351 1,678,799
------------ -----------
End of period $ 29,218,862 $ 8,737,351
============ ===========
</TABLE>
(a) A summary of capital share transactions is as follows:
SIX MONTHS ENDED YEAR ENDED
MARCH 31, 2000 SEPT. 30, 1999
-------------------------- -------------------------
SHARES PAID IN CAPITAL SHARES PAID IN CAPITAL
------ --------------- ------ ---------------
Shares sold 949,002 $ 15,347,306 520,970 $ 6,336,978
Shares issued in
reinvestment of
distributions 28,532 467,652 6,153 76,958
Shares redeemed (62,060) (1,055,937) (32,319) (421,795)
------- ------------ ------- -----------
Net increase 915,474 $ 14,759,021 494,804 $ 5,992,141
======= ============ ======= ===========
(1) COMMENCEMENT OF OPERATIONS.
(2) UNAUDITED.
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 18 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN PREMIER DIVIDEND FUND
Financial Highlights
FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
SIX MONTHS NOV. 3, 1997(1)
ENDED YEAR ENDED THROUGH
MARCH 31, 2000(4) SEPT. 30, 1999 SEPT. 30, 1999
----------------- -------------- --------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 13.12 $ 9.80 $ 10.00
------- ------- -------
Income from investment operations:
Net investment income 0.40 0.18 0.21
Net realized and unrealized gain
(loss) on investments 5.42 3.33 (0.21)
------- ------- -------
Total from investment operations 5.82 3.51 0.00
------- ------- -------
Less distributions:
From net investment income (0.21) (0.19) (0.20)
From new realized gains (0.25) -- --
------- ------- -------
Total distributions (0.46) (0.19) (0.20)
------- ------- -------
Net asset value, end of period $ 18.48 $ 13.12 $ 9.80
======= ======= =======
Total return 44.95%(3) 27.86% (0.10)%(3)
Ratios/supplemental data:
Net assets, end of period (thousands) $29,219 $ 8,737 $ 4,806
Ratio of expenses to average net assets:
Before expense reimbursement 1.57%(2) 3.06% 11.28%(2)
After expense reimbursement 1.44%(2) 1.50% 1.49%(2)
Ratio of net investment income to
average net assets
After expense reimbursement 3.25%(2) 1.51% 2.62%(2)
Portfolio turnover rate 107.97% 120.16% 147.56%
======= ======= =======
</TABLE>
----------
(1) COMMENCEMENT OF OPERATIONS.
(2) ANNUALIZED.
(3) NOT ANNUALIZED.
(4) UNAUDITED.
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 19 2000 SEMI-ANNUAL REPORT
<PAGE>
THIS PAGE WAS INTENTIONALLY LEFT BLANK.
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 20 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND & THE ROCKHAVEN PREMIER DIVIDEND FUND
Notes to Financial Statements
AT MARCH 31, 2000
NOTE 1 -- ORGANIZATION
The Rockhaven Fund and Rockhaven Premier Dividend Fund (the "Funds") are each a
series of shares of beneficial interest of Advisors Series Trust (the "Trust"),
which is registered under the Investment Company Act of 1940 as a diversified,
open-end management investment company. The Rockhaven Fund's primary investment
objective is obtaining above average current income together with capital
appreciation. The Rockhaven Premier Dividend Fund's primary investment objective
is obtaining high current income and its secondary objective is seeking capital
appreciation. The Funds attempt to achieve their objectives by investing in a
diversified portfolio of equity securities. The Funds began operations on
November 3, 1997.
NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds. These policies are in conformity with generally accepted
accounting principles.
A. SECURITY VALUATION: The Funds' investments are carried at fair value.
Securities that are primarily traded on a national securities exchange shall be
valued at the last sale price on the exchange on which they are primarily traded
on the day of valuation or, if there has been no sale on such day, at the mean
between the bid and asked prices. Securities primarily traded in the NASDAQ
National Market System for which market quotations are readily available shall
be valued at the last sale price on the day of valuation, or if there has been
no sale on such day, at the mean between the bid and asked prices.
Over-the-counter ("OTC") securities which are not traded in the NASDAQ National
Market System shall be valued at the most recent trade price. Securities for
which market quotations are not readily available, if any, are valued following
procedures approved by the Board of Trustees. Short-term investments are valued
at amortized cost, which approximates market value.
B. FEDERAL INCOME TAXES: It is the Funds' policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required.
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 21 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND & THE ROCKHAVEN PREMIER DIVIDEND FUND
Notes to Financial Statements
AT MARCH 31, 2000
C. SECURITY TRANSACTIONS, DIVIDENDS AND DISTRIBUTIONS: Security transactions are
accounted for on the trade date. Dividend income and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Distributions which exceed net realized
gains for financial reporting purposes but not for tax purposes are reported as
distributions in excess of net realized gains and are primarily due to differing
treatments for wash sales and realized losses subsequent to October 31 on sale
of securities. Realized gains and losses on securities sold are determined on
the basis of identified cost. Discounts and premiums on securities purchased are
amortized over the life of the respective securities.
D. USE OF 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 at
the date of the financial statements and the reported amounts of increases and
decreases in net assets during the reporting period. Actual results could differ
from those estimates.
NOTE 3 -- INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES For the
six months ended March 31, 2000, Rockhaven Asset Management, LLC (the "Advisor")
provided the Funds with investment management services under an Investment
Advisory Agreement. The Advisor furnished all investment advice, office space,
facilities, and provides most of the personnel needed by each Fund. As
compensation for its services, the Advisor is entitled to a monthly fee at the
annual rate of 0.75% based upon the average daily net assets of each Fund. For
the six months ended March 31, 2000, the Rockhaven Fund and The Rockhaven
Premier Dividend Fund incurred $13,838 and $67,717 , respectively, in Advisory
Fees.
The Funds are responsible for their own operating expenses. The Advisor has
agreed to reduce fees payable to it by each Fund and to pay each Fund's
operating expenses to the extent necessary to limit each Fund's aggregate annual
operating expenses to 1.50% of average net assets (the "expense cap"). Any such
reductions made by the Advisor in its fees or payment of expenses which are a
Fund's obligation are subject to reimbursement by the Fund to the Advisor, if so
requested by the Advisor, in subsequent fiscal years if the aggregate amount
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 22 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND &
THE ROCKHAVEN PREMIER DIVIDEND FUND
Notes to Financial Statements AT MARCH 31, 2000
actually paid by the Fund toward the operating expenses for such fiscal year
(taking into account the reimbursement) does not exceed the applicable
limitation on the Fund's expenses. The Advisor is permitted to be reimbursed
only for fee reductions and expense payments made in the previous three fiscal
years, but is permitted to look back five years and four years, respectively,
during the initial six years and seventh year of the Fund's operations. Any such
reimbursement is also contingent upon Board of Trustees review and approval at
the time the reimbursed is made. Such reimbursement may not be paid prior to a
Fund's payment of current ordinary operating expenses. For the six months ended
March 31, 2000, the Advisor reduced its fees and absorbed Fund expenses in the
amount of $49,191 for The Rockhaven Fund and $12,264 for The Rockhaven Premier
Dividend Fund; no amounts were reimbursed to the Advisor.
Investment Company Administration, L.L.C. (the "Administrator") acts as the
Funds' Administrator under an Administration Agreement. The Administrator
prepares various federal and state regulatory filings, reports and returns for
the Funds; prepares reports and materials to be supplied to the Trustees;
monitors the activities of the Fund's custodian, transfer agent and accountants;
coordinates the preparation and payment of Fund expenses and reviews each Fund's
expense accruals. For its services, the Administrator receives a monthly fee at
the following annual rate:
FUND ASSET LEVEL FEE RATE
---------------- --------
Less than $15 million $30,000
$15 million to less than $50 million 0.20% of average daily net assets
$50 million to less than $100 million 0.15% of average daily net assets
$100 million to less than $150 million 0.10% of average daily net assets
More than $150 million 0.05% of average daily net assets
First Fund Distributors, Inc. (the "Distributor") acts as the Funds' principal
underwriter in a continuous public offering of the Fund's shares. The
Distributor is an affiliate of the Administrator.
Certain officers of the Fund are also officers and/or directors of the
Administrator and the Distributor.
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 23 2000 SEMI-ANNUAL REPORT
<PAGE>
THE ROCKHAVEN FUND & THE ROCKHAVEN PREMIER DIVIDEND FUND
Notes to Financial Statements
AT MARCH 31, 2000
NOTE 4 -- DISTRIBUTION COSTS
Each Fund has adopted a Distribution Plan pursuant to Rule 12b-1 (the "Plan").
The Plan permits each Fund to pay for distribution and related expenses at an
annual rate of up to 0.25% of each Fund's average daily net assets annually. The
expenses covered by the Plan may include the cost of preparing and distributing
prospectuses and other sales material, advertising and public relations
expenses, payments to financial intermediaries and compensation of personnel
involved in selling shares of each Fund. Payments made pursuant to the Plan will
represent compensation for distribution and service activities, not
reimbursements for specific expenses incurred. Pursuant to a distribution
coordination agreement adopted; under the Plan, distribution fees are paid to
the Advisor as "Distribution Coordinator". For the six months ended March 31,
2000, the Funds paid the Distribution Coordinator in the amount of $4,613 for
The Rockhaven Fund and $22,772 for The Rockhaven Premier Dividend Fund.
NOTE 5 -- PURCHASES AND SALES OF SECURITIES
For the six months ended March 31, 2000, the cost of purchases and the proceeds
from sales of securities, excluding short-term securities, for The Rockhaven
Fund, were $3,116,538 and $2,553,999, respectively.
For the six months ended March 31, 2000, the cost of purchases and the proceeds
from sales of securities, excluding short-term securities, for The Rockhaven
Premier Dividend Fund, were $31,791,688 and $19,394,637, respectively.
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 24 2000 SEMI-ANNUAL REPORT
<PAGE>
Notes
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 25 2000 SEMI-ANNUAL REPORT
<PAGE>
Notes
--------------------------------------------------------------------------------
ROCKHAVEN ASSET MANAGEMENT 26 2000 SEMI-ANNUAL REPORT
<PAGE>
ADVISOR
Rockhaven Asset Management, LLC
100 First Avenue, Suite 850
Pittsburgh, PA 15222
www.rockhaven.com
DISTRIBUTOR
First Fund Distributors, Inc.
4455 East Camelback Road, Suite 261E
Phoenix, AZ 85018
CUSTODIAN Firstar Bank, N.A.
425 Walnut Street
Cincinnati, OH 45202
TRANSFER AGENT
American Data Services, Inc.
150 Motor Parkway, Suite 109
Hauppauge, NY 11788
888.229.2105
LEGAL COUNSEL
Paul, Hastings, Janofsky & Walker LLP
345 California Street, 29th Floor
San Francisco, CA 94104
AUDITORS
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
THIS REPORT IS INTENDED FOR SHAREHOLDERS OF THE FUND AND MAY NOT BE USED AS
SALES LITERATURE UNLESS PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS.
PAST PERFORMANCE RESULTS SHOWN IN THIS REPORT SHOULD NOT BE CONSIDERED A
REPRESENTATION OF FUTURE PERFORMANCE. SHARE PRICE AND RETURNS WILL FLUCTUATE SO
THAT SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
STATEMENTS AND OTHER INFORMATION HEREIN ARE DATED AND ARE SUBJECT TO CHANGE.
LOGO
ROCKHAVEN ASSET MANAGEMENT
THE RISK MANAGERS
100 First Avenue
Suite 850
Pittsburgh, PA 15222
800.522.3508
412.434.6771 FAX
www.rockhaven.com
(6/00 - 0000)
