U.S. MID-CAP PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 1998
(expressed in U.S. dollars)
(unaudited)
Shares Value
------ -----
COMMON STOCKS (87.7%)
COMMERCIAL SERVICES (1.5%)
4,285 Equifax, Inc........................................... $ 165,776
CONSUMER DURABLES (1.0%)
6,525 Broderbund Software, Inc.*............................. 116,430
CONSUMER NON-DURABLES (0.9%)
2,600 Blyth Industries, Inc.*................................ 95,388
ELECTRONIC TECHNOLOGY (3.9%)
13,500 Cypress Semiconductor Corp.*........................... 135,000
7,000 Electronics For Imaging, Inc.* 143,281
9,582 Thermedics, Inc.*...................................... 153,911
-----------
432,192
-----------
ENERGY MINERALS (5.9%)
5,400 Apache Corp............................................ 191,025
3,700 Devon Energy Corp...................................... 147,538
4,900 Lyondell Petrochemical Co.............................. 161,088
2,500 Valero Energy Corp..................................... 80,938
4,000 Vintage Petroleum, Inc................................. 78,000
-----------
658,589
-----------
FINANCE (16.9%)
5,300 Ace, Ltd............................................... 200,737
2,975 Commerce Group, Inc.................................... 112,306
6,500 Cousins Properties, Inc................................ 196,625
5,700 Crescent Real Estate
Equities Co.......................................... 194,512
6,461 Equity Office Properties
Trust................................................ 183,735
5,900 Highwoods Properties, Inc.............................. 200,600
7,500 Liberty Property Trust................................. 191,719
6,800 Meditrust Companies.................................... 204,425
131 Security Capital Group
(Warrants)........................................... 368
8,798 Security Capital Pacific Trust ........................ 196,855
14,308 United Dominion Realty
Trust, Inc........................................... 194,052
-----------
1,875,934
-----------
HEALTH SERVICES (1.2%)
10,000 Novacare, Inc.*.............. ......................... 139,375
-----------
INDUSTRIAL SERVICES (7.7%)
5,000 Ensco International, Inc............................... 141,250
3,000 Global Marine, Inc.*................................... 70,688
2,000 Helmerich & Payne, Inc................................. 61,000
6,500 Nabors Industries, Inc.*............................... 163,719
20,000 Parker Drilling Co.*................................... 212,450
6,000 Pride International, Inc.*............................. 145,875
1,000 Seacor Smit, Inc.*..................................... 58,625
-----------
853,607
-----------
NON-ENERGY MINERALS (1.5%)
2,450 Phelps Dodge Corp...................................... 164,456
PROCESS INDUSTRIES (9.2%)
5,000 Agrium, Inc............................................ 78,438
9,320 Burlington Industries, Inc.*........................... 163,100
5,800 Cheasapeake Corp....................................... 210,975
5,800 Millennium Chemicals, Inc.............................. 208,075
13,913 Nova Corp.............................................. 158,260
6,765 Westvaco Corp.......................................... 205,064
-----------
1,023,912
-----------
PRODUCER MANUFACTURING (3.8%)
3,400 Dover Corp............................................. 134,300
8,000 JLG Industries, Inc.................................... 130,500
2,700 Masco Corp............................................. 156,600
-----------
421,400
-----------
RETAIL TRADE (3.5%)
11,500 Kmart Corp............................................. 200,531
5,000 Lands' End, Inc........................................ 184,375
-----------
384,906
-----------
TECHNOLOGY SERVICES (5.9%)
9,500 CHS Electronics, Inc.*................................. 199,500
5,000 Renaissance Worldwide, Inc.*........................... 89,688
2,000 Tech Data Corp.*....................................... 99,625
2,300 Technology Solutions Co.*.............................. 73,744
5,700 Wind River Systems, Inc.*.............................. 197,897
-----------
660,454
-----------
TRANSPORTATION (7.0%)
6,925 Alexander & Baldwin, Inc............................... 199,094
4,300 Coach USA, Inc.*....................................... 203,981
<PAGE>
U.S. MID-CAP PORTFOLIO
PORTFOLIO OF INVESTMENTS--(Continued)
April 30, 1998
(expressed in U.S. dollars)
(unaudited)
Shares Value
------ -----
TRANSPORTATION (Continued)
10,345 Stolt-Nielson SA....................................... $ 194,615
4,700 Tidewater, Inc......................................... 186,238
-----------
783,928
-----------
UTILITIES (17.8%)
5,700 Cincinnati Bell, Inc................................... 218,025
6,150 Equitable Resources, Inc............................... 199,875
2,646 KN Energy, Inc......................................... 155,287
3,000 MDU Resources Group, Inc............................... 104,062
3,350 National Fuel Gas Co................................... 154,100
3,792 Nicor, Inc............................................. 155,235
3,600 Pacific Enterprises.................................... 140,175
5,470 Peoples Energy Corp.................................... 198,287
3,200 Piedmont Natural
Gas Co., Inc......................................... 109,000
3,650 Questar Corp........................................... 158,319
10,775 Seagull Energy Corp.*.................................. 183,848
7,300 Washington Gas Light Co................................ 198,469
-----------
1,974,682
-----------
TOTAL INVESTMENTS (identified cost $9,489,113) (a)....... 87.7% 9,751,029
CASH AND OTHER ASSETS IN EXCESS IN OF LIABILITIES........ 12.3 1,372,731
----- -----------
NET ASSETS .............................................. 100.0% $11,123,760
===== ===========
- --------------
* non-income producing security
(a) The aggregate cost for federal income tax purposes is $9,489,113, the
aggregate gross unrealized appreciation is $629,141, and the aggregate gross
unrealized depreciation is $367,225, resulting in net unrealized
depreciation of $261,915.
See Notes to Financial Statements.
<PAGE>
U.S. MID-CAP PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1998
(unaudited)
(expressed in U.S. dollars)
ASSETS:
Investments in securities, at value (identified
cost $9,489,113) (Note 1) .............................. $ 9,751,029
Cash ...................................................... 2,575,025
Receivable for investments sold ........................... 15,000
Dividends and other receivables ........................... 14,803
-----------
Total Assets ...................................... 12,355,857
-----------
LIABILITIES:
Payables for:
Investments purchased .................................. 1,214,815
Foreign withholding taxes .............................. 17,282
-----------
Total Liabilities ................................. 1,232,097
-----------
NET ASSETS ................................................... $11,123,760
===========
Net Assets Consist of:
Paid-in capital ......................................... $10,861,839
Net unrealized appreciation ............................. 261,921
-----------
Net Assets ................................................... $11,123,760
===========
See Notes to Financial Statements.
<PAGE>
U.S. MID-CAP PORTFOLIO
STATEMENT OF OPERATIONS
For the six months ended April 30, 1998
(unaudited)
(expressed in U.S. dollars)
INVESTMENT INCOME:
Income:
Dividends .............................................. $ 68,814
Interest ............................................... 5,156
----------
Total Income ....................................... 73,970
----------
Expenses:
Investment advisory fee (Note 2) ....................... 26,333
Expense reimbursement fee (Note 2) ..................... 7,013
Administrative fee (Note 2) ............................ 1,526
Foreign withholding taxes .............................. 17,343
----------
Total Expenses ..................................... 52,215
----------
Net Investment Income .............................. 21,755
----------
NET REALIZED AND UNREALIZED GAIN (Notes 1 and 3):
Net realized gain on investments .......................... 951,253
Net change in unrealized appreciation on
investments ............................................. 261,921
----------
Net Realized and Unrealized Gain ..................... 1,213,174
----------
Net Increase in Net Assets Resulting from Operations ...... $1,234,929
==========
See Notes to Financial Statements.
<PAGE>
U.S. MID-CAP PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
(unaudited)
(expressed in U.S. dollars)
For the six months
ended April 30, 1998
(unaudited)
--------------------
INCREASE IN NET ASSETS:
Operations:
Net investment income ................................... $ 21,755
Net realized gain on investments ........................ 951,253
Net change in unrealized appreciation on investments .... 261,921
------------
Net increase in net assets resulting from operations .. 1,234,929
------------
Capital transactions:
Proceeds from contributions ............................. 9,929,036
Value of withdrawals .................................... (40,205)
------------
Net increase in net assets resulting from
capital transactions ............................... 9,888,831
------------
Total increase in net assets ........................ 11,123,760
NET ASSETS:
Beginning of period ......................................... 0
------------
End of period ............................................... $ 11,123,760
============
See Notes to Financial Statements.
<PAGE>
U.S. MID-CAP PORTFOLIO
FINANCIAL HIGHLIGHTS
(expressed in U.S. dollars)
For the
six months ended
April 30, 1998
(unaudited)
--------------
Ratios/Supplemental Data:
Net assets, end of year (000's omitted) ................ $ 11,124
Ratio of expenses to average net assets ................ 0.80%*
Ratio of net investment income to average net assets ... 0.25%*
Portfolio turnover rate ................................ 99%
Average commission rate paid per share ................. $ 0.0600
- -----------------
* Annualized
See Notes to Financial Statements.
<PAGE>
U.S MID-CAP PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
(unaudited)
(expressed in U.S. dollars)
1. Organization and Significant Accounting Policies. U.S. Mid-Cap
Portfolio (the "Portfolio") is registered under the Investment Company Act of
1940, as amended, as an open-end management investment company which was
organized as a trust under the laws of the State of New York on June 15, 1993.
The Portfolio commenced operations on November 1, 1997. The Declaration of Trust
permits the Trustees to create an unlimited number of beneficial interests in
the Portfolio.
The Portfolio's financial statements are prepared in accordance with
accounting principles generally accepted in the United States of America, which
require management to make certain estimates and assumptions at the date of the
financial statements and are based, in part, on the following accounting
policies. Actual results could differ from those estimates.
A. Valuation of Investments. (1) The value of investments listed on
a securities exchange is based on the last price on that exchange prior to
the time when assets are valued, or in the absence of recorded sales, at
the average of readily available closing bid and asked prices on such
exchange; (2) unlisted securities are valued at the average of the quoted
bid and asked prices in the over-the-counter market; (3) securities or
other assets for which market quotations are not readily available are
valued at fair value in accordance with procedures established by and
under the general supervision and responsibility of the Trustees. Such
procedures include the use of independent pricing services, which use
prices based upon yields or prices of securities of comparable quality,
coupon, maturity and type; indications as to the value from dealers; and
general market conditions; (4) short-term investments which mature in 60
days or less are valued at amortized cost if their original maturity was
60 days or less, or by amortizing their value on the 61st day prior to
maturity, if their original maturity when acquired by the Portfolio was
more than 60 days, unless this is determined not to represent fair value
by the Trustees.
B. Accounting for Investments. Security transactions are accounted
for on the trade date. Realized gains and losses on security transactions
are determined on the identified cost method. Dividend income and other
distributions from portfolio securities are recorded on the ex-dividend
date. Dividend income is recorded net of foreign taxes withheld where
recovery of such taxes is not assured. Interest income is accrued daily.
C. Federal Income Taxes. The Portfolio will be treated as a
partnership for federal income tax purposes. As such, each investor in the
Portfolio will be subject to taxation on its share of the Portfolio's
ordinary income and capital gains. It is intended that the Portfolio's
assets will be managed in such a way that an investor in the Portfolio
will be able to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. Accordingly, no provision
for federal income taxes is necessary.
2. Transactions with Affiliates.
Investment Advisory Fee. The Portfolio has an investment advisory
agreement with Brown Brothers Harriman & Co. (the "Adviser") for which it pays
the Adviser a fee calculated daily and paid monthly at an annual rate equivalent
to 0.65% of the Portfolio's average daily net assets. For the six months ended
April 30, 1998, the Portfolio incurred $26,333 for advisory services.
Administrative Fee. The Portfolio has an administrative agreement with
Brown Brothers Harriman Trust Company (Cayman) Limited (the "Administrator") for
which it pays the Administrator a fee calculated daily and paid monthly at an
annual rate equivalent to 0.035% of the Portfolio's average daily net assets.
The Administrator
<PAGE>
U.S MID-CAP PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
(expressed in U.S. dollars)
has a subadministration agreement with Signature Financial Group (Cayman) Ltd.
for which Signature Financial Group (Cayman) Ltd. receives such compensation as
is from time to time agreed upon. For the six months ended April 30, 1998, the
Portfolio incurred $1,526 for administrative services.
Expense Reimbursement Fee. Brown Brothers Harriman Trust Company (Cayman)
Limited pays certain expenses of the Portfolio and receives a fee from the
Portfolio, computed and paid monthly, such that after such fee the aggregate
expenses will not exceed 0.80% of the Portfolio's average daily net assets. For
the six months ended April 30, 1998, Brown Brothers Harriman Trust Company
(Cayman) Limited incurred $12,991 in expenses on behalf of the Portfolio. The
expense reimbursement agreement will terminate when the aggregate amount of fees
received by Brown Brothers Harriman Trust Co. (Cayman) Limited thereunder equals
the aggregate amount of expenses paid by Brown Brother Harriman Trust Company
(Cayman) Limited thereunder.
3. Investment Transactions. For the six months ended April 30, 1998, the
cost of purchases and the proceeds of sales of investment securities other than
short-term investments were $15,809,873 and $7,834,597, respectively. There were
no purchases or sales of U.S. government obligations during the period.
