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DUNHILL INVESTMENT TRUST
REGIONAL OPPORTUNITY FUND
OHIO, INDIANA, KENTUCKY SERIES
FINANCIAL STATEMENTS
AND
SEMI-ANNUAL REPORT
AUGUST 31, 2000
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<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES - August 31, 2000 (Unaudited)
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ASSETS
<S> <C>
Investments in securities at market value (identified
cost $5,297,003) (Note 1) $ 9,891,685
Receivable for capital shares sold 105,103
Receivable from related party 7,820
Dividends and interest receivable 2,681
------------
Total Assets 10,007,289
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LIABILITIES
Other accrued expenses and liabilities 21,510
------------
Total Liabilities 21,510
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NET ASSETS $ 9,985,779
============
NET ASSETS CONSIST OF:
Paid-in capital $ 4,099,220
Accumulated net investment loss (104,885)
Accumulated net realized gains from security transactions 1,396,762
Net unrealized appreciation on investments 4,594,682
------------
Net Assets $ 9,985,779
============
PRICING OF CLASS B SHARES
Net assets attributable to Class B shares $ 9,775,212
============
Shares of beneficial interest outstanding (unlimited number
of shares authorized, no par value) 373,931
============
Net asset value and offering price per share * $ 26.14
============
PRICING OF CLASS C SHARES
Net assets attributable to Class C shares $ 210,567
============
Shares of beneficial interest outstanding (unlimited number
of shares authorized, no par value) 8,055
============
Net asset value and offering price per share * $ 26.14
============
</TABLE>
* Redemption price per share varies by length of time shares are held.
See accompanying notes to financial statements.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
STATEMENT OF OPERATIONS For The Six Months Ended August 31, 2000 (Unaudited)
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INVESTMENT INCOME
Dividend income $ 15,654
Interest income 37,549
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Total Investment Income 53,203
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EXPENSES
Management fees (Note 3) 70,133
Distribution fees - Class B (Note 3) 57,620
Distribution fees - Class C (Note 3) 825
Shareholder services and transfer agent fees (Note 3) 16,498
Fund accounting fees (Note 3) 14,803
Administration fees (Note 3) 8,778
Professional fees 13,077
Custodian fees 2,921
Trustees' fees 1,184
Other expenses 5,813
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Total Expenses 191,652
Fees waived by the Manager (Note 3) (33,564)
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Net Expenses 158,088
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NET INVESTMENT LOSS (104,885)
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REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS
Net realized gains from security transactions 1,050,909
Net decrease in unrealized appreciation/depreciation
on investments (836,736)
------------
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS 214,173
------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 109,288
============
See accompanying notes to financial statements.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
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Six Months Ended
August 31, 2000 Year Ended
(Unaudited) February 29, 2000
------------------ ------------------
FROM OPERATIONS
<S> <C> <C>
Net investment loss $ (104,885) $ (234,566)
Net realized gains on investments 1,050,909 2,567,018
Net change in unrealized appreciation/depreciation on investments (836,736) 1,234,519
------------ ------------
Net increase in net assets resulting from operations 109,288 3,566,971
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DISTRIBUTIONS TO SHAREHOLDERS
From net realized gains -- (1,907,066)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
CLASS B SHARES
Proceeds from shares sold 431,325 820,412
Net asset value of shares issued in reinvestment
of distributions to shareholders -- 1,907,066
Payments for shares redeemed (4,296,174) (959,697)
------------ ------------
Net increase (decrease) in net assets from Class B share
transactions (3,864,849) 1,767,781
------------ ------------
CLASS C SHARES (a)
Proceeds from shares sold 119,395 79,806
Net asset value of shares issued in reinvestment
of distributions to shareholders -- --
Payments for shares redeemed (1,229) --
------------ ------------
Net increase in net assets from Class C share transactions 118,166 79,806
------------ ------------
Total increase (decrease) in net assets (3,637,395) 3,507,492
NET ASSETS
Beginning of period 13,623,174 10,115,682
------------ ------------
End of period $ 9,985,779 $ 13,623,174
============ ============
SUMMARY OF CAPITAL SHARE ACTIVITY
CLASS B SHARES
Shares sold 17,548 34,150
Shares issued in reinvestment of distributions to shareholders -- 80,535
Shares redeemed (176,733) (37,991)
------------ ------------
Net increase (decrease) in shares outstanding (159,185) 76,694
Shares outstanding, beginning of period 533,116 456,422
------------ ------------
Shares outstanding, end of period 373,931 533,116
============ ============
CLASS C SHARES (a)
Shares sold 4,779 3,281
Shares issued in reinvestment of distributions to shareholders -- --
Shares redeemed (5) --
------------ ------------
Net increase in shares outstanding 4,774 3,281
Shares outstanding, beginning of period 3,281 --
------------ ------------
Shares outstanding, end of period 8,055 3,281
============ ============
</TABLE>
(a) Class C commenced operations on January 31, 2000.
See accompanying notes to financial statements.
<PAGE>
Regional Opportunities Fund: Ohio, Indiana, Kentucky
Class B
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
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Selected Per Share Data and Ratios for a Share Outstanding Throughout Each Period
Six Months Year Year Year Period
Ended Ended Ended Ended Ended
August 31, February 29, February 28, February 28, February 28,
2000 (Unaudited) 2000 1999 1998 1997 (a)
------------ ------------ ------------ ------------ ------------
PER SHARE DATA
--------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 25.40 $ 22.16 $ 15.41 $ 11.33 $ 10.46
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment loss (0.01) (0.38) (0.32) (0.13) (0.02)
Net realized and unrealized gains on investments 0.75 7.76 7.07 4.21 1.30
------------ ------------ ------------ ------------ ------------
Total from investment operations 0.74 7.38 6.75 4.08 1.28
------------ ------------ ------------ ------------ ------------
Distributions from net realized gains -- (4.14) -- -- (0.41)
------------ ------------ ------------ ------------ ------------
Net asset value at end of period $ 26.14 $ 25.40 $ 22.16 $ 15.41 $ 11.33
============ ============ ============ ============ ============
TOTAL RETURN (b) 2.91% 34.70% 43.80% 36.01% 12.25%
---------------- ============ ============ ============ ============ ============
RATIOS/SUPPLEMENTAL DATA
------------------------
Net assets at end of period $ 9,775,212 $ 13,539,836 $ 10,115,682 $ 4,965,434 $ 646,067
Ratio of expenses to average net assets:
Before expense reimbursement and waived fees 3.28%(c) 3.52% 3.64% 5.81% 12.14%(c)
After expense reimbursement and waived fees 2.70%(c) 2.70% 2.70% 2.69% 2.66%(c)
Ratio of net investment loss to average net assets (1.79)%(c) (2.04)% (1.87)% (1.69)% (1.04)%(c)
Portfolio turnover rate 24%(c) 151% 26% 21% 39%(c)
</TABLE>
(a) Represents the period from the first public offering to shareholders (July
24, 1996) through February 28, 1997. Class B shares were initially
purchased on April 10, 1995 by the Adviser, who subsequently redeemed the
initial shares on March 13, 1996.
(b) Calculated without sales charge.
(c) Annualized.
See accompanying notes to financial statements.
<PAGE>
Regional Opportunities Fund: Ohio, Indiana, Kentucky
Class C
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
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Six Months Period
Ended Ended
August 31, February 29,
2000 (Unaudited) 2000 (a)
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PER SHARE DATA
--------------
<S> <C> <C>
Net asset value at beginning of period $ 25.40 $ 23.50
------------ ------------
Income from investment operations:
Net investment loss (0.01) (0.04)
Net realized and unrealized gains on investments 0.75 1.94
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Total from investment operations 0.74 1.90
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Net asset value at end of period $ 26.14 $ 25.40
============ ============
TOTAL RETURN (b) 2.91% 8.09%
------------ ============ ============
RATIOS/SUPPLEMENTAL DATA
------------------------
Net assets at end of period $ 210,567 $ 83,338
Ratio of expenses to average net assets:
Before expense reimbursement and waived fees 3.28%(c) 3.79%(c)
After expense reimbursement and waived fees 2.70%(c) 2.70%(c)
Ratio of net investment loss to average net assets (1.79)%(c) (2.18)%(c)
Portfolio turnover rate 24%(c) 151%(c)
</TABLE>
(a) Represents the period from the first public offering to shareholders
(January 31, 2000) through February 29, 2000.
(b) Calculated without sales charge.
(c) Annualized.
See accompanying notes to financial statements.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
PORTFOLIO OF INVESTMENTS - August 31, 2000 (Unaudited)
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Shares Value
-------- ------------
COMMON STOCKS - 98.8%
AUTO/TRUCK PARTS - 0.2%
10,000 Environmental Solutions Worldwide, Inc. (a) $ 20,625
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COMMUNICATIONS - 3.8%
1,000 Aware, Inc. (a) 44,813
6,000 Broadwing, Inc. 167,625
1,000 Comverse Technology, Inc. (a) 91,937
400 Nextel Communications, Inc. (a) 22,175
600 Qwest Communications International, Inc. (a) 30,975
200 Sprint Corp. (FON Group) 6,700
400 Sprint Corp. (PCS Group) (a) 20,075
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384,300
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COMPUTERS & INFORMATION - 20.8%
7,000 Dell Computer Corp. (a) 305,375
14,000 EMC Corp. (a) 1,372,000
4,000 Lexmark International, Inc. - Class A (a) 271,250
3,000 MCSI, Inc. 103,125
225 Veritas Software Co. (a) 27,127
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2,078,877
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COMPUTER SERVICES - 3.9%
1,000 Checkfree Holdings Corp. (a) 51,812
2,200 Check Point Software Technology, Ltd. (a) 320,788
400 Sapient Corp. (a) 21,000
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393,600
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CONGLOMERATES - 5.6%
9,600 General Electric Co. 563,400
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DIVERSIFIED MANUFACTURING - 2.3%
4,000 Tyco International, Inc. 228,000
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ELECTRONIC COMPONENTS - 0.5%
2,000 Universal Electronics, Inc. (a) 47,406
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FIBER OPTICS - 1.0%
800 JDS Uniphase Corp. (a) 99,700
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See accompanying notes to financial statements.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
PORTFOLIO OF INVESTMENTS - August 31, 2000 (Unaudited)
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Market
Shares Value
-------- ------------
COMMON STOCKS - 98.8% (Continued)
FILTRATION PRODUCTS - 0.2%
1,000 Scott Technologies, Inc. (a) $ 18,938
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FOOD RETAILERS - 0.9%
4,000 Kroger Co. (a) 90,750
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GAMBLING (NON-HOTEL) - 0.6%
4,000 Argosy Gaming Co. (a) 64,000
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HOUSEHOLD PRODUCTS, NONDURABLE - 4.2%
6,860 The Procter & Gamble Co. 424,034
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INDUSTRIAL & COMMERCIAL SERVICES - 1.6%
4,000 Convergys Corp. (a) 156,500
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INTERNET CONTENT - 0.7%
1,000 Go2Net, Inc. (a) 69,000
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INTERNET SOFTWARE - 1.0%
2,900 Broadvision, Inc. (a) 100,050
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MEDICAL SUPPLIES - 7.8%
1,500 Amgen, Inc. (a) 113,718
2,000 Genzyme Corp. (a) 150,125
7,600 Guidant Corp. (a) 511,575
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775,418
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MOTORCYCLES/MOTOR SCOOTERS - 1.5%
3,000 Harley-Davidson, Inc. 149,438
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PHARMACEUTICALS - 9.0%
2,800 Johnson & Johnson 257,424
3,000 Immunex Corp. (a) 150,750
3,000 Medimmune, Inc. (a) 252,375
2,800 Pfizer, Inc. 121,100
2,016 Priority Healthcare - Class B (a) 116,424
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898,073
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POWER (INDEPENDENT) - 4.0%
4,000 Calpine Corp. (a) 396,000
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See accompanying notes to financial statements.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
PORTFOLIO OF INVESTMENTS - August 31, 2000 (Unaudited)
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Market
Shares Value
-------- ------------
COMMON STOCKS - 98.8% (Continued)
REGIONAL BANKS - 3.2%
1,312 Fifth Third Bancorp $ 60,598
10,865 Firstar Corp. 259,402
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320,000
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RETAILERS, APPAREL - 0.3%
2,100 Intimate Brands, Inc. 33,863
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RETAILERS, DISCOUNT - 1.9%
4,000 Wal-Mart Stores, Inc. 189,750
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SEMICONDUCTOR & RELATED - 7.7%
5,300 Conexant Systems, Inc. (a) 197,093
4,000 Intel Corp. 299,500
4,000 Texas Instruments, Inc. 267,750
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764,343
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SOFTWARE & PROCESSING - 16.1%
9,600 America Online, Inc. (a) 562,800
11,100 Cisco Systems, Inc. (a) 760,350
4,000 Microsoft Corp. (a) 279,250
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1,602,400
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TOTAL COMMON STOCKS - 98.8% (Cost $5,273,783) $ 9,868,465
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MONEY MARKET SECURITIES - 0.2%
23,220 Firstar Stellar Treasury Fund (Cost $23,220) $ 23,220
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TOTAL INVESTMENTS AT VALUE - 99.0% (Cost $5,297,003) $ 9,891,685
OTHER ASSETS IN EXCESS OF LIABILITIES - 1.0% 94,094
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NET ASSETS - 100.0% $ 9,985,779
============
(a) Non-income producing security
See accompanying notes to financial statements.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
NOTES TO FINANCIAL STATEMENTS - August 31, 2000 (Unaudited)
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1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The Regional Opportunity Fund: Ohio, Indiana, Kentucky (the Fund) is a
non-diversified, open-end series of the Dunhill Investment Trust (the
Trust), a registered management investment company under the Investment
Company Act of 1940 (the 1940 Act). The Trust was organized as an Ohio
business trust on March 31, 1998. Pursuant to an Agreement and Plan of
Reorganization, the Fund, on June 29, 1998, succeeded to the assets and
liabilities of another mutual fund of the same name which was an investment
series of Maplewood Investment Trust.
The Fund's investment objective is to provide long-term capital growth by
investing primarily in common stocks and other equity securities of
publicly-traded companies headquartered in Greater Cincinnati and the
Cincinnati tri-state region, and those companies having a significant
presence in the region.
The Fund offers two separate classes of shares: Class B and Class C. Class
B shares of the Fund are offered at net asset value and are subject to a
maximum 5% contingent deferred sales charge and 12b-1 distribution fees up
to 1% of average daily net assets. The contingent deferred sales charge is
applicable to redemptions during the five-year period from the date of
purchase. The charge declines from 5% to 0% over the five-year period.
Class C shares of the Fund are offered at net asset value and are subject
to a 1% contingent deferred sales charge if redeemed within one year after
purchase and 12b-1 distribution fees up to 1% of average daily net assets.
SECURITIES VALUATION - The Fund's portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m. Eastern time). Securities which are traded
over-the-counter are valued at the last sales price, if available,
otherwise, at the last quoted bid price. Securities traded on a national
stock exchange are valued based upon the closing price on the principal
exchange where the security is traded.
REPURCHASE AGREEMENTS - The Fund may invest its cash reserves by entering
into repurchase agreements with its custodian bank. The repurchase
agreement, which is collateralized by U.S. Government obligations, is
valued at cost which, together with accrued interest, approximates market.
At the time the Fund enters into the repurchase agreement, the seller
agrees that the value of the underlying securities, including accrued
interest, will at all times be equal to or exceed the face amount of the
repurchase agreement. In addition, the Fund actively monitors and seeks
additional collateral, as needed.
SHARE VALUATION - The net asset value of each class of shares is calculated
daily by dividing the total value of the Fund's assets attributable to that
class, less liabilities attributable to that class, by the number of shares
of that class outstanding. The redemption price per share of each class is
equal to the net asset value per share.
INVESTMENT INCOME - Interest income is accrued as earned. Dividend income
is recorded on the ex-dividend date.
DISTRIBUTIONS TO SHAREHOLDERS - Dividends arising from net investment
income, if any, are declared and paid annually to shareholders of the Fund.
Net realized short-term capital gains, if any, may be distributed
throughout the year and net realized long-term capital gains, if any, are
distributed at least once a year. Income distributions and capital gain
distributions are determined in accordance with income tax regulations.
SECURITY TRANSACTIONS - Security transactions are accounted for on trade
date. Cost of securities sold is determined on a specific identification
basis.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
NOTES TO FINANCIAL STATEMENTS (Continued) - August 31, 2000 (Unaudited)
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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 income and expenses during the reporting period. Management
believes the estimates utilized in preparing these financial statements are
reasonable and prudent. Actual results could differ from these estimates.
FEDERAL INCOME TAX - It is the Fund's policy to comply with the special
provisions of the Internal Revenue Code applicable to regulated investment
companies. As provided therein, in any fiscal year in which a Fund so
qualifies and distributes at least 90% of its taxable net income, the Fund
(but not the shareholders) will be relieved of federal income tax on the
income distributed. Accordingly, no provision for income taxes has been
made. In order to avoid imposition of the excise tax applicable to
regulated investment companies, it is also the Fund's intention to declare
as dividends in each calendar year at least 98% of its net investment
income (earned during the calendar year) and 98% of its net realized
capital gains (earned during the twelve months ended October 31) plus
undistributed amounts from prior years.
RECLASSIFICATION OF CAPITAL ACCOUNTS - For the year ended February 29,
2000, the Fund reclassified net investment losses of $234,566 against
paid-in capital on the Statement of Assets and Liabilities. This
reclassification was the result of permanent differences between financial
statement and income tax reporting requirements and has no effect on the
Fund's net assets or net asset value per share.
2. INVESTMENT TRANSACTIONS
During the six months ended August 31, 2000, purchases and proceeds from
sales and maturities of investment securities, other than short-term
investments, amounted to $1,217,501 and $4,445,756, respectively.
For federal income tax purposes, the cost of portfolio investments amounted
to $5,297,003 at August 31, 2000. The composition of unrealized
appreciation (the excess of value over cost) and unrealized depreciation
(the excess of tax cost over value) was as follows:
Gross unrealized appreciation $ 5,050,424
Gross unrealized depreciation (455,742)
-----------
Net unrealized appreciation $ 4,594,682
===========
3. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
Certain officers of the Trust are also officers of Dunhill Investment
Advisors, Ltd. (Dunhill), the manager and administrator for the Fund, and
CityFund Advisory, Inc. (CityFund), the investment advisor to the Fund.
FUND MANAGER AGREEMENT
The Fund is managed by Dunhill under the terms of a Management Agreement.
The Fund pays Dunhill a fee equal to the annual rate of 1.20% of the
average value of its daily net assets. Dunhill currently intends to waive
its management fees and reimburse expenses of the Fund to the extent
necessary to limit the total operating expenses of the Fund to 2.70% of
average daily net assets of the Fund. Accordingly, for the six months ended
August 31, 2000, Dunhill waived $33,564 of its management fees.
INVESTMENT ADVISORY AGREEMENT
The Fund's investments are managed by CityFund under the terms of an
Investment Advisory Agreement. Under the Investment Advisory Agreement,
Dunhill (not the Fund) pays CityFund a fee equal to an annual rate of .50%
of the average daily net assets of the Fund.
<PAGE>
Regional Opportunity Fund: Ohio, Indiana, Kentucky
NOTES TO FINANCIAL STATEMENTS (Continured) - August 31, 2000 (Unaudited)
--------------------------------------------------------------------------------
ADMINISTRATIVE AGREEMENT
Under the terms of an Administrative Agreement, Dunhill supplies executive,
administrative and regulatory services to the Fund, supervises the
preparation of tax returns, and coordinates the preparation of reports to
shareholders and reports to and filings with the Securities and Exchange
Commission and state securities authorities. For these services, Dunhill
receives a monthly fee from the Fund at an annual rate of 0.15% on its
average daily net assets up to $50 million; 0.125% on the next $50 million
of such net assets; and 0.10% of such net assets in excess of $100 million.
During the six months ended August 31, 2000, Dunhill was paid $13,685 of
fees under the Agreement. Dunhill subcontracts with Ultimus Fund Solutions,
LLC to assist Dunhill in providing administrative services to the Fund.
TRANSFER AGENT AND SHAREHOLDER SERVICING AGREEMENT
Under the terms of a Transfer Agent and Shareholder Servicing Agreement,
Dunhill maintains the records of each shareholder's account, answers
shareholders' inquiries concerning their accounts, processes purchases and
redemptions of the Fund's shares, acts as dividend and distribution
disbursing agent and performs other shareholder service functions. For
these services, Dunhill receives a monthly fee from the Fund at the annual
rate of $17 per shareholder account, subject to a minimum monthly fee of
$2,000. In addition, the Fund pays out-of-pocket expenses including, but
not limited to, postage and supplies. During the six months ended August
31, 2000, Dunhill was paid $16,498 of fees under the Agreement. Dunhill
subcontracts with Unified Fund Services, Inc. to assist Dunhill in
providing transfer agent services to the Fund.
DISTRIBUTION AGREEMENT
Under the terms of a Distribution Agreement with the Trust, Unified
Management Corporation (the Distributor) is the national distributor for
the Fund. The Distributor may sell Fund shares to or through qualified
securities dealers or others.
4. DISTRIBUTION PLAN
The Fund has adopted a Distribution Plan (the Plan) pursuant to Rule 12b-1
under the 1940 Act. The Plan provides that the Fund may incur certain costs
related to the distribution of Fund shares, generally not to exceed 1.00%
of the Fund's average daily net assets. During the six months ended August
31, 2000, Class B and Class C shares of the Fund incurred distribution
expenses under the Plan of $57,620 and $825, respectively.
