<PAGE> 1
APRIL 30, 2000
[CRABBE HUSON FUNDS LOGO] SEMIANNUAL REPORT
CRABBE HUSON FUNDS
CRABBE HUSON
CONTRARIAN FUND
CRABBE HUSON
EQUITY FUND
CRABBE HUSON
MANAGED INCOME
& EQUITY FUND
CRABBE HUSON
REAL ESTATE
INVESTMENT FUND
CRABBE HUSON
SMALL CAP FUND
THE CRABBE HUSON
SPECIAL FUND, INC.
CRABBE HUSON
CONTRARIAN INCOME FUND
CRABBE HUSON
OREGON TAX-FREE FUND
[MOUNTAIN SCENE]
<PAGE> 2
APRIL 30, 2000
-------------------
SEMIANNUAL REPORT
Cover Image copyright (C)1999 PhotoDisc, Inc.
<PAGE> 3
[Crabbe Huson LOGO]
Dear Shareholder: A Subsidiary of Liberty Financial Companies, Inc.
The past six months proved to be a volatile period in both the stock and bond
markets, as well as a very productive one for the Crabbe Huson funds.
In the equity markets, investor enthusiasm shifted not once but twice during the
period. Last fall, stocks of large-cap growth companies in many industries fell
out of favor while investors bought up equities in the high-tech sectors of the
economy: technology, telecommunications and biotech. Since most of these are
smaller-capitalization stocks, the small-cap indexes (e.g., the Russell 2000)
outperformed the large-cap indexes, such as the Standard & Poor's 500 and Dow
Jones Industrial Average, for the first time in several years. Then, early this
spring, the situation changed again as investors, fearful of inflated prices for
technology stocks, abandoned that sector and embraced value-oriented stocks that
had been in the doldrums for some time.
For the fixed-income markets, the six-month period brought first a rise in the
yield of the benchmark 30-year Treasury security, then a decline. The movements
in the bond markets were driven by fears of higher inflation and three 0.25%
interest rate increases by the Federal Reserve, overlapped by a reduction in the
supply of long-term Treasury debt and, ultimately, less concern about inflation
getting out of hand.
Against this backdrop of rapidly changing investor sentiment and volatility, the
Crabbe Huson funds generally performed quite well and, in most cases, better
than their respective benchmark indexes. We were not surprised. As contrarian
investors, we don't seek to invest in today's market leaders. We always want to
purchase tomorrow's leaders in advance of the crowd, preferably while they are
out-of-favor and, thus, more reasonably priced. In this way, we may be able to
reap substantial rewards when catalysts for positive change bring these
companies to investors' attention. Over the course of the past six months, many
of the areas that have been out-of-favor and overlooked by investors rotated
into favor; others that had been popular lost their cache, resulting in the
Crabbe Huson funds delivering above-average results. We think this demonstrates
quite clearly that ours is essentially a conservative investment style that may
help investors during times of uncertainty and changing investor sentiment.
In the pages that follow, our management team provides specific information
about the Funds and how our contrarian strategy served investors during this
challenging but exciting period in the markets.
As always, thank you for choosing Crabbe Huson and for giving us the opportunity
to serve your investment needs.
Sincerely,
/s/ Stephen E. Gibson
Stephen E. Gibson
President
June 15, 2000
1
<PAGE> 4
CRABBE HUSON CONTRARIAN FUND
HALF-YEAR PERFORMANCE BESTS S&P 500 AND RUSSELL 2000
Crabbe Huson Contrarian Fund, a portfolio of large-, medium- and small-company
stocks, outpaced both the large-cap and small-cap markets for the six months
ended April 30, 2000. At 23.68%, the six-month total return before sales charges
for Class A shares was considerably stronger than the 7.18% and 18.72% total
returns for the Standard & Poor's 500 Index and Russell 2000 Index,
respectively.
This equity fund seeks to invest in the best contrarian stocks that we can find.
The Fund generally invests at least 60% of the assets in large- and
mid-capitalization companies and may invest the balance in small-capitalization
company issues. Stocks of varying sizes can perform differently through a market
cycle and the Fund is set up to try and profit from this.
TECHNOLOGY AND SMALL CAPS LEAD THE CHARGE
In true contrarian form, when small caps were generally unpopular and relatively
inexpensive for several years prior to 1999, we added to our positions. During
the past six months our small-cap stocks have performed extremely well with the
Fund positioned 26% in small caps at the beginning of the period and close to
30% by the end of the period. Among the better-performing, small-company stocks
in the portfolio were technology issues we had purchased when their prices were
greatly depressed in 1999. During the run up in technology stocks from November
until mid-March, we pared back many of these same positions, based on the
feeling that many of these stocks had become overvalued. The April/May NASDAQ
correction has once again offered the opportunity to buy many high-quality
technology companies.
GOOD RESULTS FOR BASIC MATERIALS, HEALTH CARE AND ENERGY
Historically, basic materials companies and consumer cyclical industries have
performed poorly in rising interest rate environments. True to form, the Fund's
consumer cyclical holdings declined approximately 5% over the six months as
short-term interest rates climbed. However, we were pleasantly surprised by
results for the basic materials segment of the portfolio, where most of our
holdings appreciated. Prices of these stocks had been severely depressed. We
attribute the better-than-expected performance to strong, worldwide economic
growth, which has led to greater demand for their products allowing them to pass
along cost increases to customers.
As investor enthusiasm for technology cooled between mid-March and the end of
the period, sectors like energy and health care rotated into favor. Ravaged by
cuts in Medicare and legal problems in recent years, traditional health care
companies finally entered the recovery room. Major medical providers like United
Health Group, Inc. (2.9% of net assets) were able to pass along the increasing
costs of doing business and to reverse operating losses.
We made a commitment to the energy sector more than a year ago, building
positions in energy-related stocks after oil prices reached a low of $10 per
barrel. Although
2
<PAGE> 5
CRABBE HUSON CONTRARIAN FUND
energy continued to lag, we stood by our convictions and were rewarded when the
prices of oil and natural gas rebounded early in 2000. Many of the stocks have
begun to reach our price targets and we have begun to trim positions somewhat.
FINAL SIX WEEKS BRING NEW OPPORTUNITIES
When investors generally moved away from technology stocks and toward other,
less-pricey sectors, we viewed this change as an opportunity to take profits in
non-technology stocks that jumped ahead. We also began reinvesting in technology
stocks that only a few weeks before had been too expensive and popular to meet
our criteria. In our view, the extreme sell-off in technology has been driven by
mechanical factors -- margin calls, investor fear, and institutions selling
large blocks of stock. It has little to do with the underlying strengths of the
stocks we have purchased, some of which had fallen to 50% or more below their
peaks. While we remain underweighted in technology versus our benchmarks, we are
finding more opportunities and beginning to rebuild positions.
LOOKING FOR MORE VOLATILITY AHEAD
It is obvious to us that the Federal Reserve is serious about controlling
inflation. In addition to hiking short-term interest rates six times in less
than 12 months, it is also draining money out of the banking system, thereby
reducing liquidity. We believe this will lead to greater investor uncertainty,
increased volatility and more rotations among the sectors of the market as
economic growth slows. This may give us ample opportunity to identify areas
where investor sentiment has become too negative. As contrarians, we want to
take advantage of such trends to buy good companies that are temporarily
out-of-favor with the general investing public.
<TABLE>
<S> <C>
/s/ James E. Crabbe /s/ John E. Maack, Jr., CFA
James E. Crabbe John E. Maack, Jr., CFA
</TABLE>
------------------------
An investment in the Fund offers significant long-term growth potential, but
also involves certain risks. The Fund may be affected by stock market
fluctuations that may occur in response to economic and business developments.
Investing in small-capitalization stocks presents special risks, including
possible illiquidity and greater price volatility than stocks of more
established companies.
3
<PAGE> 6
CRABBE HUSON CONTRARIAN FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
INCEPTION DATE 12/1/1998 12/1/1998 12/1/1998
SHARE CLASS A B C
WITHOUT WITH WITHOUT WITH WITHOUT WITH
SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C>
Cumulative Six
months 23.68% 16.57% 23.14% 18.14% 23.16% 22.16%
One year 13.92% 7.37% 13.07% 8.07% 12.98% 11.98%
Life of Fund 19.37% 14.48% 18.51% 15.87% 18.45% 18.45%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<CAPTION>
A B C
WITHOUT WITH WITHOUT WITH WITHOUT WITH
SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C>
Cumulative Six
months 19.53 12.66 19.10 14.10 19.00 18.00
One year 24.42 17.26 23.51 18.51 23.41 22.41
Life of Fund 20.25 15.03 19.34 16.50 19.27 19.27
</TABLE>
Past performance cannot predict future results. Returns and value of an
investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 5.75% sales charge for Class A shares, the appropriate Class B
contingent deferred sales charge for the holding period after purchase as
follows: through first year-5%, second year-4%, third year-3%, fourth year-3%,
fifth year-2%, sixth year-1%, thereafter-0% and the Class C contingent deferred
sales charge of 1% for the first year only.
Performance for different share classes will vary based on differences in sales
charges and fees associated with each class.
Performance results reflect any voluntary waivers or reimbursements of fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
4
<PAGE> 7
CRABBE HUSON CONTRARIAN FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS - 93.1%
---------------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE - 16.8%
DEPOSITORY INSTITUTIONS - 4.0%
4,100 U.S. Bancorp......................................... $ 83,281
3,800 Washington Mutual, Inc. ............................. 97,137
-------------
180,418
-------------
INSURANCE CARRIERS - 12.8%
1,100 Chubb Corp. ......................................... 69,988
4,200 Fidelity National Financial, Inc. ................... 61,950
900 MGIC Investment Corp. ............................... 43,031
4,000 Safeco Corp. ........................................ 88,500
4,100 StanCorp Financial Group, Inc. ...................... 119,412
2,000 United Health Group ................................. 133,360
900 Wellpoint Health Networks, Inc. ..................... 66,375
-------------
582,616
-------------
MANUFACTURING - 22.4%
APPAREL - 1.6%
1,000 Liz Claiborne, Inc. ................................. 46,312
2,500 The Warnaco Group, Inc., Class A..................... 26,562
-------------
72,874
-------------
CHEMICALS & ALLIED PRODUCTS - 1.6%
1,600 Goodrich (B.F.) Co. ................................. 51,000
1,100 Wellman, Inc. ....................................... 23,512
-------------
74,512
-------------
ELECTRICAL INDUSTRIAL EQUIPMENT - 0.9%
1,100 American Power Conversion Corp.(a)................... 38,844
-------------
ELECTRONIC & ELECTRICAL EQUIPMENT - 1.9%
1,000 Advanced Micro Devices, Inc. ........................ 87,750
-------------
ELECTRONIC COMPONENTS - 0.4%
900 Rayovac Corp.(a)..................................... 18,787
-------------
FOOD & KINDRED PRODUCTS - 3.4%
9,400 IBP, Inc. ........................................... 155,100
-------------
MACHINERY & COMPUTER EQUIPMENT - 4.7%
13,000 Auspex Systems, Inc.(a).............................. 99,125
800 Baker Hughes, Inc. .................................. 25,450
1,700 Compaq Computer Corp. ............................... 49,725
800 Seagate Technology, Inc.(a).......................... 40,650
-------------
214,950
-------------
MEASURING & ANALYZING INSTRUMENTS - 2.5%
2,000 Eastman Kodak Co. ................................... 111,875
-------------
</TABLE>
See notes to investment portfolio.
5
<PAGE> 8
CRABBE HUSON CONTRARIAN FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-------------------------
<C> <S> <C>
MANUFACTURING (CONTINUED)
PAPER PRODUCTS - 0.6%
2,100 Longview Fibre Co. .................................. $ 26,775
-------------
PRIMARY METAL - 2.5%
600 Alcoa, Inc. ......................................... 38,925
2,800 Century Aluminum Co. ................................ 39,200
3,000 Ispat International NV, NY Registered Shares......... 35,062
-------------
113,187
-------------
TRANSPORTATION EQUIPMENT - 2.3%
3,800 Delphi Automotive Systems Corp. ..................... 72,675
600 Ford Motor Co. ...................................... 32,813
-------------
105,488
-------------
MINING & ENERGY - 9.3%
CRUDE PETROLEUM & NATURAL GAS - 2.6%
3,000 Burlington Resources, Inc. .......................... 117,937
-------------
OIL & GAS EXTRACTION - 2.8%
1,400 Forest Oil Corp.(a).................................. 15,662
900 Nabors Industries, Inc.(a)........................... 35,494
1,300 Tom Brown, Inc.(a)................................... 24,700
2,700 Union Pacific Resources Group, Inc. ................. 51,806
-------------
127,662
-------------
OIL & GAS FIELD SERVICES - 3.9%
8,700 Input/Output, Inc.(a)................................ 64,163
1,100 Schlumberger Ltd. ................................... 84,219
400 Smith International, Inc. ........................... 30,400
-------------
178,782
-------------
RETAIL TRADE - 5.8%
APPAREL & ACCESSORY STORES - 1.1%
4,400 Abercrombie & Fitch Co.(a)........................... 48,400
-------------
FOOD STORES - 1.3%
1,900 Albertson's, Inc. ................................... 61,869
-------------
GENERAL MERCHANDISE STORES - 1.0%
1,300 Federated Department Stores, Inc.(a)................. 44,200
-------------
RESTAURANTS - 2.4%
5,900 Darden Restaurants, Inc. ............................ 108,781
-------------
</TABLE>
See notes to investment portfolio.
6
<PAGE> 9
CRABBE HUSON CONTRARIAN FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-------------------------
<C> <S> <C>
SERVICES - 27.0%
AUTO REPAIR, RENTAL, & PARKING - 2.3%
6,900 Budget Group, Inc. Class A(a)........................ $ 32,344
2,300 Hertz Corp Class A................................... 71,731
-------------
104,075
-------------
BUSINESS SERVICES - 0.8%
2,800 Daleen Technologies, Inc.(a)......................... 36,750
-------------
COMPUTER RELATED SERVICES - 5.8%
1,400 Ariba, Inc.(a)....................................... 103,863
900 At Home Corp. Series A(a)............................ 16,763
600 Commerce One, Inc.(a)................................ 36,637
1,200 Convergys Corp.(a)................................... 52,800
4,200 Mentor Graphics Corp.(a)............................. 55,125
-------------
265,188
-------------
COMPUTER SOFTWARE - 2.6%
2,600 PeopleSoft, Inc.(a).................................. 36,238
7,100 Quatum Corp.-Hard Disk Drive(a)...................... 82,981
-------------
119,219
-------------
HEALTH SERVICES - 14.9%
600 Becton, Dickinson & Co. ............................. 15,375
800 Biogen, Inc.(a)...................................... 47,050
8,100 Coventry Health Care Inc.(a)......................... 86,063
6,700 Healthsouth Corp.(a)................................. 54,019
7,400 Health Management Associates, Inc.(a)................ 117,938
13,500 Mid Atlantic Medical Services, Inc.(a)............... 125,720
10,000 Vysis, Inc.(a)....................................... 74,375
3,300 Tenet Healthcare Corp. .............................. 84,150
1,700 Watson Pharmaceuticals, Inc.(a)...................... 76,394
-------------
681,084
-------------
MOTION PICTURES - 0.6%
4,100 Hollywood Entertainment Corp.(a)..................... 28,700
-------------
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 8.6%
AIR TRANSPORTATION - 1.5%
2,300 Alaska Air Group..................................... 66,125
-------------
ELECTRIC SERVICES - 1.5%
1,200 Duke Energy Corp. ................................... 69,000
-------------
</TABLE>
See notes to investment portfolio.
7
<PAGE> 10
CRABBE HUSON CONTRARIAN FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-------------------------
<C> <S> <C>
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES (CONTINUED)
GAS SERVICES - 2.7%
1,200 Columbia Energy Group................................ $ 75,299
1,100 El Paso Energy Corp. ................................ 46,750
-------------
122,049
-------------
TELECOMMUNICATION - 1.8%
1,100 MediaOne Group, Inc.(a).............................. 83,188
-------------
TRANSPORTATION SERVICES - 1.1%
5,100 Fritz Cos., Inc.(a).................................. 49,088
-------------
WHOLESALE TRADE - 3.2%
DURABLE GOODS - 0.8%
800 Grainger (W.W.), Inc. ............................... 34,700
-------------
NONDURABLE GOODS - 2.4%
6,700 Fleming Co., Inc. ................................... 110,131
-------------
Total Common Stocks
(cost of $3,570,855)(b) 4,240,104
-------------
PAR SHORT-TERM OBLIGATIONS - 6.9%
-------- -----------------------------------------------------
Repurchase agreement with SBC Warburg Ltd., dated
$314,000 04/28/00 due 05/01/00 at 5.710% collateralized by
U.S. Treasury notes with maturities to 2025, market
value $321,239 (repurchase proceeds $314,149)...... 314,000
-------------
OTHER ASSETS & LIABILITIES, NET - 0.0% (1,966)
-------------
NET ASSETS - 100.0% $4,552,138
-------------
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing.
(b) Cost for federal income tax purposes is the same.
See notes to financial statements.
8
<PAGE> 11
CRABBE HUSON EQUITY FUND
AS MARKET TURNS, PERFORMANCE SURPASSES THE S&P 500
For the six months ended April 30, 2000, Class A shares of Crabbe Huson Equity
Fund chalked up a total return of 14.95% before sales charges, or more than
double the 7.18% total return for the Standard & Poor's 500 Index. The strong
results for the Fund can be attributed to a swift rotation in the U.S. equity
markets in early 2000. The shift brought many of our mid- and large-cap holdings
back into favor.
THE MARKET GOES LOOKING FOR LARGER, LESS PRICEY STOCKS
From the fall of 1999 through the early months of 2000, investors showed a
marked preference for technology and small-capitalization stocks. Many other
mid- and large-capitalization stocks fell from favor, bringing them within reach
of our price-sensitive, contrarian style of investing. As a result, since last
October, we have been able to add more mid- and large-cap stocks to the
portfolio, lifting the Fund's average market capitalization from roughly $6
billion at October 31 to approximately $12 billion at April 30.
In March 2000, the "growth spurt" for technology came to a rather dramatic end.
After peaking on March 10, the technology-heavy NASDAQ Index retreated 35.7% by
April 14. The quick turn of events benefited the Fund in two ways. First,
investors looked for reasonably priced, less-volatile alternatives to technology
and gravitated toward large- and mid-sized, higher-quality companies, which
caused many of our holdings to appreciate. Second, April gave us a wonderful
opportunity to purchase stocks with good, long-term potential we had not been
able to own recently, including some fundamentally sound technology stocks that
were 50% or more below their 52-week highs. Among these is Ariba, Inc. (2.4% of
net assets), a business-to-business Internet company that sets up websites for
exchanging goods at a fixed price or through an auction.
POSITIVE CHANGES -- AND RESULTS -- FOR HEALTH CARE
The Fund's health care holdings gained 32% over cost during the six-month
period. Ravaged by cuts in Medicare and legal problems in recent years, the
sector is finally regaining some strength. For the first time in years, major
medical providers were in a position to pass along some of the increasing costs
of doing business and to reverse their operating losses. The change has
attracted positive attention from investors and contributed to substantial gains
for our positions in Health Management Associates (2.6% of net assets) and
United Health Group (3.2% of net assets). Consistent with our contrarian
approach, now that the sector is getting back on its feet, we have chosen to
take some profits and have been trimming our allocation in this area.
ENERGY CONTINUES TO PERFORM WELL
When oil prices reached a low of $10 per barrel roughly two years ago, we began
building positions as others discarded energy stocks. While we were early
entering energy stocks, we were rewarded for our patience when the prices of oil
and natural gas rebounded in 1999 and continued to move higher in 2000. Many
energy stocks in
9
<PAGE> 12
CRABBE HUSON EQUITY FUND
the portfolio have reached our initial price targets and, while we continue to
like energy and remain overweight, we have begun to sell selected positions. The
Fund's largest energy holding as of April 30 was Baker Hughes (3.0% of net
assets), an exploration services company. The stock price had risen 43% over our
cost.
VOLATILE MARKETS MAY BODE WELL FOR THE FUND
April 2000 clearly demonstrated that volatility can actually work in the Fund's
favor. In that one month alone, total return jumped more than 2% as many
out-of-favor stocks gained popularity. We believe the markets may provide more
opportunities like this in the coming months. It is obvious to us the Federal
Reserve is serious about controlling inflation. In addition to hiking short-term
interest rates six times in less than 12 months, it is also draining money out
of the banking system, thereby reducing liquidity. This represents a significant
change -- no longer just talking tough, the Fed is acting tough as well. We
believe this will lead to greater investor uncertainty, increased volatility and
more rotations among the various sectors of the market. From a contrarian
standpoint, this is good news. We believe it will give us ample opportunity to
identify areas where investor sentiment has become too negative and to buy
stocks as they fall out of favor. By focusing on stocks that have already
corrected in price and then finding a positive catalyst, we hope to reduce the
investment risk in the portfolio.
/s/ John E. Maack, Jr., CFA
John E. Maack, Jr., CFA
/s/ Robert E. Anton /s/ Jeffrey D. Huffman, CFA
Robert E. Anton Jeffrey D. Huffman, CFA
------------------------
An investment in the Fund offers significant long-term growth potential, but it
also involves certain risks. The Fund may be affected by stock market
fluctuations that occur in response to economic and business developments.
10
<PAGE> 13
CRABBE HUSON EQUITY FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
INCEPTION DATE 1/31/1989 1/27/1999 1/27/1999 10/3/1996
SHARE CLASS A B C I
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C>
Cumulative
Six months 14.95% 8.34% 14.51% 9.51% 14.44% 13.44% 15.22%
One year 2.28% (3.61)% 1.48% (3.45)% 1.48% 0.49% 2.76%
Five years 11.35% 10.04% 11.11% 10.84% 11.11% 11.11% 11.68%
10 years 14.53% 13.85% 14.40% 14.40% 14.40% 14.40% 14.69%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<CAPTION>
SHARE CLASS A B C I
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C>
Cumulative
Six months 10.34% 3.99% 9.92% 4.92% 9.92% 8.92% 10.61%
One year 11.84% 5.41% 10.90% 5.90% 10.90% 9.90% 12.32%
Five years 11.11% 9.80% 10.88% 10.62% 10.88% 10.88% 11.43%
10 years 13.67% 13.00% 13.55% 13.55% 13.55% 13.55% 13.83%
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 5.75% sales charge for Class A shares, the appropriate Class B
contingent deferred sales charge for the holding period after purchase as
follows: through first year-5%, second year-4%, third year-3%, fourth year-3%,
fifth year-2%, sixth year-1%, thereafter-0% and the Class C contingent deferred
sales charge of 1% for the first year only. Class I shares (institutional
shares) are offered without sales charges or contingent deferred sales charges.
Performance for different share classes will vary based on differences in sales
charges and fees associated with each class.
Performance results reflect any voluntary waivers or reimbursement to Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class B, C and I share (newer class shares) performance information includes
returns of the Fund's Class A shares (the oldest existing fund class) for
periods prior to its inception date. These Class A share returns are not
restated to reflect any expense differential (e.g., Rule 12b-1 fees) between
Class A shares and the newer class shares. Had the expense differential been
reflected, the returns for the periods prior to the inception of Class B and
Class C shares would have been lower.
11
<PAGE> 14
CRABBE HUSON EQUITY FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS - 95.2%
-----------------------------------------------------
<S> <C> <C>
FINANCE, INSURANCE & REAL ESTATE - 14.9%
DEPOSITORY INSTITUTIONS - 2.9%
45,400 First Union Corp. ................................... $ 1,447,125
71,400 U.S. Bancorp......................................... 1,450,313
-------------
2,897,438
-------------
INSURANCE CARRIERS - 10.6%
116,800 Ace, Ltd. ........................................... 2,795,900
30,200 Chubb Corp. ......................................... 1,921,475
23,100 MGIC Investment Corp. ............................... 1,104,469
49,000 United Health Group ................................. 3,267,320
22,000 Wellpoint Health Networks, Inc. ..................... 1,622,500
-------------
10,711,664
-------------
NONDEPOSITORY CREDIT INSTITUTIONS - 1.4%
52,200 Countrywide Credit Industries, Inc. ................. 1,442,025
-------------
MANUFACTURING - 33%
APPAREL - 1.2%
26,500 Liz Claiborne, Inc. ................................. 1,227,281
-------------
CHEMICALS & ALLIED PRODUCTS - 1.3%
41,300 Goodrich (B.F.) Co. ................................. 1,316,438
-------------
COMMUNICATIONS EQUIPMENT - 1.7%
27,900 Lucent Technologies, Inc. ........................... 1,735,031
-------------
ELECTRONIC & ELECTRICAL EQUIPMENT - 2.6%
29,600 Advanced Micro Devices, Inc. ........................ 2,597,400
-------------
FOOD & KINDRED PRODUCTS - 5.6%
122,200 IBP, Inc. ........................................... 2,016,300
25,200 Keebler Foods Co. ................................... 792,225
70,600 Phillip Morris Cos., Inc. ........................... 1,544,375
87,000 Sara Lee Corp. ...................................... 1,305,000
-------------
5,657,900
-------------
MACHINERY & COMPUTER EQUIPMENT - 7.4%
93,800 Baker Hughes, Inc. .................................. 2,984,012
38,300 Compaq Computer Corp. ............................... 1,120,275
130,600 McDermott International, Inc. ....................... 1,061,125
14,300 Seagate Technology, Inc.(a).......................... 726,619
216,100 Silicon Graphics, Inc.(a)............................ 1,553,219
-------------
7,445,250
-------------
MEASURING & ANALYZING INSTRUMENTS - 2.4%
44,600 Eastman Kodak Co. ................................... 2,494,812
-------------
MISCELLANEOUS MANUFACTURING - 2.3%
50,300 Tyco International Ltd. ............................. 2,310,656
-------------
</TABLE>
See notes to investment portfolio.
12
<PAGE> 15
CRABBE HUSON EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-----------------------------------------------------
<C> <S> <C>
MANUFACTURING (CONTINUED)
PETROLEUM REFINING - 1.5%
64,400 USX-Marathon Group................................... $ 1,501,325
-------------
PRIMARY METAL - 2.5%
39,300 Alcoa, Inc. ......................................... 2,549,587
-------------
TRANSPORTATION EQUIPMENT - 4.5%
16,700 DaimlerChrysler AG................................... 961,294
64,200 Delphi Automotive Systems Corp. ..................... 1,227,825
43,000 Ford Motor Co. ...................................... 2,351,562
-------------
4,540,681
-------------
MINING & ENERGY - 6.6%
CRUDE PETROLEUM & NATURAL GAS - 1.9%
47,800 Burlington Resources, Inc. .......................... 1,879,137
-------------
OIL & GAS EXTRACTION - 2.2%
118,100 Union Pacific Resources Group, Inc. ................. 2,266,044
-------------
OIL & GAS FIELD SERVICES - 2.5%
23,300 Schlumberger Ltd. ................................... 1,783,906
9,400 Smith International, Inc. ........................... 714,400
-------------
2,498,306
-------------
RETAIL TRADE - 4.8%
FOOD STORES - 1.5%
47,500 Albertson's, Inc. ................................... 1,546,719
-------------
GENERAL MERCHANDISE STORES - 0.9%
27,900 Federated Department Stores, Inc.(a)................. 948,600
-------------
RESTAURANTS - 2.4%
133,200 Darden Restaurants, Inc. ............................ 2,455,875
-------------
SERVICES - 23.2%
AUTO REPAIR, RENTAL & PARKING - 1.6%
52,400 Hertz Corp., Class A................................. 1,634,225
-------------
COMPUTER RELATED SERVICES - 7.6%
32,900 Ariba, Inc.(a) ...................................... 2,440,769
23,800 At Home Corp., Series A(a)........................... 443,275
12,900 Commerce One, Inc.(a)................................ 787,706
43,100 Convergys Corp.(a)................................... 1,896,400
82,400 Deluxe Corp. ........................................ 2,075,450
-------------
7,643,600
-------------
</TABLE>
See notes to investment portfolio.
13
<PAGE> 16
CRABBE HUSON EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-----------------------------------------------------
<C> <S> <C>
SERVICES (CONTINUED)
COMPUTER SOFTWARE - 3.6%
74,900 Healtheon/WebMD Corp.(a)............................. $ 1,577,581
18,400 Microsoft Corp.(a) .................................. 1,283,400
59,100 PeopleSoft, Inc.(a) ................................. 823,706
-------------
3,684,687
-------------
HEALTH SERVICES - 10.3%
51,900 Becton, Dickinson & Co. ............................. 1,329,938
18,600 Biogen, Inc.(a)...................................... 1,093,912
211,200 Healthsouth Corp.(a)................................. 1,702,800
166,100 Health Management Associates, Inc.(a)................ 2,647,219
75,700 Tenet Healthcare Corp. .............................. 1,930,350
37,700 Watson Pharmaceuticals, Inc. ........................ 1,694,144
-------------
10,398,363
-------------
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITATION SERVICES - 12.7%
AIR TRANSPORTATION - 1.4%
26,200 British Airways PLC.................................. 1,378,775
-------------
ELECTRIC SERVICES - 2.7%
40,200 Duke Energy Corp. ................................... 2,311,500
17,200 PG&E Corp. .......................................... 446,125
-------------
2,757,625
-------------
GAS SERVICES - 2.9%
30,000 Columbia Energy Group................................ 1,882,500
23,900 El Paso Energy Corp. ................................ 1,015,750
-------------
2,898,250
-------------
SANITARY SERVICES - 0.3%
21,500 Waste Management, Inc. .............................. 341,313
-------------
TELECOMMUNICATION - 3.2%
25,900 CenturyTel, Inc. .................................... 634,550
34,100 MediaOne Group, Inc.(a).............................. 2,578,813
-------------
3,213,363
-------------
WATER TRANSPORTATION - 1.0%
42,500 Carnival Corp., Class A.............................. 1,057,187
-------------
WHOLESALE TRADE - 1.2%
DURABLE GOODS
$ 27,800 Grainger (W.W.), Inc. ............................... 1,205,825
-------------
Total Common Stocks (cost of $83,588,786)(b) 96,235,382
-------------
</TABLE>
See notes to investment portfolio.
14
<PAGE> 17
CRABBE HUSON EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
PAR VALUE
-------------- ----------------------------------------------------- --------------
<C> <S> <C>
SHORT-TERM OBLIGATIONS - 5.7%
-----------------------------------------------------
$5,805,000 Repurchase agreement with SBC Warburg Ltd., dated
04/28/00, due 05/01/00 at 5.710%, collateralized by
U.S. Treasury notes with various maturities to
2025, market value $5,938,839 (repurchase proceeds
$5,807,762)........................................ $ 5,805,000
-------------
OTHER ASSETS & LIABILITIES, NET - (0.9)% (932,195)
-------------
NET ASSETS - 100.0% $101,108,187
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing.
(b) Cost for federal income tax purposes is the same.
See notes to financial statements.
15
<PAGE> 18
CRABBE HUSON MANAGED INCOME & EQUITY FUND
FUND TOPPED BOTH EQUITY AND BOND MARKET RETURNS
For the six months ended April 30, 2000, Class A shares of Crabbe Huson Managed
Income & Equity Fund generated a total return of 9.01% before sales charges,
surpassing 7.18% total return for the Standard & Poor's 500 Index and the 1.51%
total return for the Lehman Brothers Long-Term Government/Corporate Bond Index.
The strong results for the Fund, which invests in both equities and fixed-income
securities, were due largely to a swift rotation in the U.S. equity markets
during early 2000.
EQUITY PORTION OUTPERFORMS AT PERIOD-END
From the fall of 1999 through the early months of 2000, investors showed a
marked preference for technology stocks. Many mid- and large-capitalization
stocks fell from favor, bringing them within reach of our price-sensitive,
contrarian style of investing. As a result, since last October, we have been
able to add more mid- and large-cap stocks to the portfolio.
In March 2000, the "growth spurt" for technology came to a dramatic end. After
peaking on March 10, the technology-heavy NASDAQ Index dropped 35.7% by April
14. The quick turn of events benefited the Fund in two ways. First, investors
looking for reasonably priced, less-volatile alternatives to technology
gravitated toward higher-quality mid-sized and large companies, which caused
many of our holdings to appreciate. Second, April gave us an opportunity to
purchase stocks with good, long-term potential that we had not been able to own
recently, including some fundamentally sound technology stocks that, in a clear
case of guilt by association, were beaten down 50% or more from their highs.
We were particularly pleased about gains for our large-cap health care stocks.
Ravaged by cuts in Medicare and legal problems in recent years, the sector is
finally regaining strength. For the first time in years, major medical providers
were in a position to pass along some of the increasing costs of doing business
and to reverse their operating losses. The change has attracted positive
attention from investors and contributed to substantial gains for our positions
in Health Management Associates (1.5% of net assets) and United Health Group
(2.0% of net assets). Consistent with our contrarian approach, now that the
sector is getting back on its feet, we have chosen to take some profits and have
been trimming our allocation to the sector.
ENERGY CONTINUES TO PERFORM WELL
When oil prices reached a low of $10 per barrel roughly two years ago, we began
building positions as others discarded energy stocks. We were rewarded for our
patience when the prices of oil and natural gas rebounded in 1999 and continued
to move higher in 2000. Many energy stocks in the portfolio have reached our
initial price targets and, while we continue to like the energy sector, we have
begun to sell selected positions. One of the Fund's largest energy holdings at
April 30 was Baker Hughes (1.7% of net assets), an exploration services company.
The share price had risen 44% over our cost.
16
<PAGE> 19
CRABBE HUSON MANAGED INCOME & EQUITY FUND
FEARS OF INFLATION CAUSE MIXED RESULTS FOR BONDS
In the U.S. Treasury market, fears of inflation led initially to higher bond
yields and lower prices across the full range of maturities. Later, yields for
long-term Treasury securities declined and their prices rose, due to a
combination of factors. First, the Treasury Department began buying back
long-term government debt in January. As the available supply of these long-term
securities dwindled, investors bid up prices for the remaining bonds. Second,
two early-2000 interest rate increases by the Federal Reserve and evidence that
the U.S. economy is slowing convinced investors inflationary pressures
ultimately should abate.
On the corporate side, yields followed Treasurys higher during the first months
of the period but lagged Treasurys as they declined in the second half. Higher
interest rates may increase the cost of doing business for corporations, a
perceived risk that led investors to continue to demand higher yields. The gap
between Treasury and corporate yields widened, and prices of most corporate
bonds fell.
FUND'S BOND HOLDINGS KEPT PACE WITH BENCHMARK INDEX
Approximately one-half of the Fund's fixed-income assets are invested in
corporate issues, including a 20% allocation to bonds rated BBB. When the
difference between government and corporate yields increased after January, this
portion of the bond portfolio underperformed the index. However, this drag on
performance was partially offset by high current income from mortgage-backed
securities -- mostly obligations from the Government National Mortgage
Association (GNMAs), which are backed by the full faith and credit of the U.S.
government. Another offsetting factor was an emphasis on long-term Treasury
securities. Long-term bonds generally appreciate more than their short-term
counterparts when prices rally, so increasing the amount invested in long-term
bonds helped performance as rates fell and prices rose after January.
VOLATILE MARKETS MAY BODE WELL FOR THE FUND
We expect the equity and bond markets to be volatile in the coming six months.
It is obvious to us the Federal Reserve is serious about controlling inflation.
In addition to hiking short-term interest rates six times in less than 12
months, it is also draining money out of the banking system, thereby reducing
liquidity. We believe this will lead to greater investor uncertainty, increased
volatility and more rotations among the various sectors of the equity market.
This scenario would provide us ample opportunity to purchase out-of-favor stocks
in many sectors and capture gains if investor preferences change.
17
<PAGE> 20
CRABBE HUSON MANAGED INCOME & EQUITY FUND
In the bond market, investor sentiment, which has been bearish for some time, is
likely to remain so for the foreseeable future. As contrarians, we view this as
a sign the bond market may have reached or will soon reach a low point; so we
will keep the Fund positioned for a more favorable environment later in the
year.
/s/ Garth R. Nisbet, CFA /s/ Paul C. Rocheleau
Garth R. Nisbet, CFA Paul C. Rocheleau
/s/ John E. Maack, Jr., CFA
John E. Maack, Jr., CFA
/s/ Robert E. Anton /s/ Jeffrey D. Huffman, CFA
Robert E. Anton Jeffrey D. Huffman, CFA
------------------------
The value and returns of your investment may be affected by stock market
fluctuations. Investing in stocks may include liquidity risks as well. Changes
in interest rates, changes in the financial strength of issuers of lower rated
bond, foreign, political and economic developments may affect Fund performance.
18
<PAGE> 21
CRABBE HUSON MANAGED INCOME & EQUITY FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
INCEPTION DATE 1/31/1989 1/27/1999 1/27/1999 10/28/1996
SHARE CLASS A B C I
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C>
Cumulative
Six months 9.01% 3.83% 8.44% 3.44% 8.44% 7.44% 9.29%
One year 2.01% (2.84)% 1.00% (3.60)% 1.00% 0.08% 2.51%
Five years 9.50% 8.44% 9.26% 8.98% 9.26% 9.26% 9.82%
10 years 10.83% 10.29% 10.70% 10.70% 10.70% 10.70% 10.98%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<CAPTION>
SHARE CLASS A B C I
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C>
Cumulative
Six months 6.99% 1.91% 6.59% 1.67% 6.59% 5.60% 7.26%
One year 8.40% 3.25% 7.59% 2.68% 7.59% 6.61% 8.94%
Five years 9.61% 8.55% 9.41% 9.14% 9.41% 9.41% 9.90%
10 years 10.42% 9.89% 10.32% 10.32% 10.32% 10.32% 10.57%
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 4.75% sales charge for Class A shares, the appropriate Class B
contingent, deferred sales charge for the holding period after purchase as
follows: through first year-5%, second year-4%, third year-3%, fourth year-3%,
fifth year-2%, sixth year-1%, thereafter-0% and the Class C contingent deferred
sales charge of 1% for the first year only. Class I shares (institutional
shares) are offered without sale charges or contingent deferred sale charges.
Performance for different share classes will vary based on differences in sales
charges and fees associated with each class.
Performance results reflect any voluntary waivers or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class B, C and I shares (newer class shares) performance information includes
returns of the Fund's Class A shares (the oldest existing fund class) for
periods prior to its inception date. These Class A share returns are not
restated to reflect any expense differential (e.g., Rule 12b-1 fees) between
Class A shares and the newer class shares. Had the expense differential been
reflected, the returns for the periods prior to the inception of Class B and
Class C shares would have been lower.
19
<PAGE> 22
CRABBE HUSON MANAGED INCOME & EQUITY FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS - 55.5%
-----------------------------------------------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE - 8.8%
DEPOSITORY INSTITUTIONS - 1.6%
10,700 First Union Corp. ................................... $ 341,062
17,200 U.S. Bancorp ........................................ 349,375
-------------
690,437
-------------
INSURANCE CARRIERS - 6.3%
28,200 Ace, Ltd. ........................................... 675,037
7,200 Chubb Corp. ......................................... 458,100
5,600 MGIC Investment Corp. ............................... 267,750
12,400 United Health Group ................................. 826,832
5,300 Wellpoint Health Networks, Inc. ..................... 390,875
-------------
2,618,594
-------------
NONDEPOSITORY CREDIT INSTITUTIONS - 0.9%
13,200 Countrywide Credit Industries, Inc. ................. 364,650
-------------
MANUFACTURING - 23.0%
APPAREL - 0.7%
6,400 Liz Claiborne, Inc. ................................. 296,400
-------------
CHEMICALS & ALLIED PRODUCTS - 8%
9,900 Goodrich (B.F.) Co. ................................. 315,563
-------------
COMMUNICATIONS EQUIPMENT - 1.0%
6,700 Lucent Technologies, Inc. ........................... 416,656
-------------
ELECTRONIC & ELECTRICAL EQUIPMENT - 1.5%
7,100 Advanced Micro Devices, Inc. ........................ 623,025
-------------
FOOD & KINDRED PRODUCTS - 3.3%
30,900 IBP, Inc. ........................................... 509,850
6,100 Keebler Foods Co. ................................... 191,769
17,000 Philip Morris Companies, Inc. ....................... 371,875
21,000 Sara Lee Corp. ...................................... 315,000
-------------
1,388,494
-------------
MACHINERY & COMPUTER EQUIPMENT - 4.3%
22,600 Baker Hughes, Inc. .................................. 718,962
9,200 Compaq Computer Corp. ............................... 269,100
31,500 McDermott International, Inc. ....................... 255,938
3,400 Seagate Technology, Inc.(a).......................... 172,763
52,100 Silicon Graphics, Inc.(a)............................ 374,469
-------------
1,791,232
-------------
</TABLE>
See notes to investment portfolio.
20
<PAGE> 23
CRABBE HUSON MANAGED INCOME & EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-----------------------------------------------------
<C> <S> <C>
MANUFACTURING (CONTINUED)
MEASURING & ANALYZING INSTRUMENTS - 1.4%
10,700 Eastman Kodak Co. ................................... $ 598,531
-------------
MISCELLANEOUS MANUFACTURING - 1.3%
12,300 Tyco International Ltd. ............................. 565,031
-------------
PETROLEUM REFINING - 0.9%
10,700 USX-Marathon Group................................... 359,012
-------------
PRIMARY METAL - 1.5%
9,500 Alcoa, Inc. ......................................... 616,312
-------------
TRANSPORTATION EQUIPMENT - 2.6%
4,000 Daimler Chrysler AG.................................. 230,250
15,500 Delphi Automotive Systems Corp. ..................... 296,437
10,400 Ford Motor Co. ...................................... 568,750
-------------
1,095,437
-------------
MINING & ENERGY - 3.4%
CRUDE PETROLEUM & NATURAL GAS - 1.1%
11,500 Burlington Resources, Inc. .......................... 452,093
-------------
OIL & GAS EXTRACTION - 1.3%
28,400 Union Pacific Resources Group, Inc. ................. 544,925
-------------
OIL & GAS FIELD SERVICES - 1.0%
5,600 Schlumberger Ltd. ................................... 428,750
-------------
RETAIL TRADE - 2.8%
FOOD STORES - 0.9%
11,400 Albertson's, Inc. ................................... 371,212
-------------
GENERAL MERCHANDISE STORES - 0.5%
6,700 Federated Department Stores, Inc.(a)................. 227,800
-------------
RESTAURANTS - 1.4%
32,100 Darden Restaurants, Inc. ............................ 591,844
-------------
SERVICES - 10.1%
AUTO REPAIR, RENTAL & PARKING - 0.9%
12,600 Hertz Corp., Class A................................. 392,962
-------------
COMPUTER RELATED SERVICES - 4.4%
8,100 Ariba, Inc.(a)....................................... 600,919
5,700 At Home Corp. Series A(a)............................ 106,163
3,100 Commerce One, Inc.(a)................................ 189,294
10,400 Convergys Corp.(a)................................... 457,600
19,900 Deluxe Corp. ........................................ 501,231
-------------
1,855,207
-------------
</TABLE>
See notes to investment portfolio.
21
<PAGE> 24
CRABBE HUSON MANAGED INCOME & EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-----------------------------------------------------
<C> <S> <C>
SERVICES (CONTINUED)
COMPUTER SOFTWARE - 2.1%
18,400 Healtheon/WebMD Corp.(a)............................. $ 387,550
4,400 Microsoft Corp.(a)................................... 306,900
14,300 PeopleSoft, Inc.(a).................................. 199,306
-------------
893,756
-------------
HEALTH SERVICES - 6.1%
12,500 Becton, Dickinson & Co. ............................. 320,312
4,500 Biogen, Inc.(a)...................................... 264,656
50,900 Healthsouth Corp.(a)................................. 410,381
40,000 Health Management Associates, Inc.(a)................ 637,500
18,200 Tenet Healthcare Corp. .............................. 464,100
9,100 Watson Pharmaceuticals, Inc.(a)...................... 408,931
-------------
2,505,880
-------------
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 6.7%
AIR TRANSPORTATION - 0.8%
6,300 British Airways PLC.................................. 331,538
-------------
ELECTRIC SERVICES - 1.6%
9,700 Duke Energy Corp. ................................... 557,750
4,100 PG&E Corp. .......................................... 106,344
-------------
664,094
-------------
OIL & GAS FIELD SERVICES - 2.1%
7,200 Columbia Energy Group................................ 451,800
5,800 El Paso Energy Corp. ................................ 246,500
2,300 Smith International, Inc. ........................... 174,800
-------------
873,100
-------------
SANITARY SERVICES - 0.2%
5,200 Waste Management, Inc. .............................. 82,550
-------------
TELECOMMUNICATION - 1.8%
6,200 CenturyTel, Inc. .................................... 151,900
8,250 MediaOne Group, Inc.(a).............................. 623,906
-------------
775,806
-------------
WATER TRANSPORTATION - 0.6%
10,100 Carnival Corp. ...................................... 251,237
-------------
</TABLE>
See notes to investment portfolio.
22
<PAGE> 25
CRABBE HUSON MANAGED INCOME & EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS (CONTINUED)
-----------------------------------------------------
<C> <S> <C>
WHOLESALE TRADE - 0.7%
DURABLE GOODS
6,700 Grainger (W.W.), Inc. ............................... $ 290,613
-------------
Total Common Stocks
(cost of $19,969,550) 23,272,691
-------------
<CAPTION>
PAR U.S. GOVERNMENT & AGENCY OBLIGATIONS - 21.9%
-------------- --------------------------------------------
<C> <S> <C>
COUPON MATURITIES FROM/TO
-----------------------------------------------------
Federal Home Loan Mortgage Corp.:
1,769,344 7.000% 11/1/25....................................... 1,769,344
503,950 7.500% 9/1/25........................................ 492,611
634,019 8.000% 6/1/26........................................ 631,838
320,628 9.000% 4/1/17........................................ 327,240
21,710 9.250% 11/1/16....................................... 22,212
-------------
3,243,245
-------------
Federal National Mortgage Association,
200,000 8.250% 12/18/00...................................... 201,844
-------------
Government National Mortgage Association:
620,274 6.500% 11/15/28...................................... 581,122
753,913 7.000% 12/15/27...................................... 725,641
1,715,401 7.000% 6/15/28....................................... 1,649,461
-------------
2,956,224
-------------
U.S. Treasury Bonds:
15,000 5.500% 8/15/28....................................... 13,624
125,000 6.375% 8/15/27....................................... 127,636
150,000 6.750% 8/15/26....................................... 160,218
-------------
301,478
-------------
U.S. Treasury Notes:
700,000 5.875% 11/15/24...................................... 681,513
1,795,000 6.105% 8/15/29....................................... 1,799,201
-------------
2,480,714
-------------
Total U.S. Government & Agency Obligations (cost of $6,474,393) 9,183,505
-------------
CORPORATE FIXED INCOME BONDS & NOTES - 18.9%
-----------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - 4.9%
DEPOSITORY INSTITUTIONS - 1.2%
500,000 Green Tree Financial Corp., Series 1997-7, Class A-5,
6.540% 7/15/19....................................... 495,005
-------------
</TABLE>
See notes to investment portfolio.
23
<PAGE> 26
CRABBE HUSON MANAGED INCOME & EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
PAR VALUE
-------------- ----------------------------------------------------- --------------
CORPORATE FIXED INCOME BONDS & NOTES (CONTINUED)
---------------------------------------------------------------------------------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE (CONTINUED)
INSURANCE CARRIERS - 2.1%
400,000 Conseco, Inc., 7.875% 12/15/00....................... $ 304,000
630,000 Lincoln National Corp., 6.500% 3/15/08............... 566,131
-------------
870,131
-------------
NONDEPOSITORY CREDIT INSTITUTIONS - 1.6%
655,000 General Motors Acceptance Corp., 9.000% 10/15/02..... 676,792
-------------
MANUFACTURING - 6.0%
SECURITY BROKERS & DEALERS - 1.3%
580,000 Bear Stearns Cos., Inc., 6.875% 10/1/05.............. 552,108
-------------
CHEMICALS & ALLIED PRODUCTS - 1.4%
20,000 E.I. DuPont De Nemours & Co., 8.250% 9/15/06......... 20,603
550,000 Eli Lilly & Co., 8.375% 12/1/06...................... 574,745
-------------
595,348
-------------
FABRICATED METAL - 1.3%
550,000 Snap-on, Inc., 6.625% 10/1/05........................ 526,405
-------------
FOOD & KINDRED PRODUCTS - 1.3%
550,000 Anheuser Busch Cos., Inc., 7.000% 9/1/05............. 529,766
-------------
RUBBER & PLASTIC - 0.7%
300,000 Premark International, Inc., 6.875% 11/15/08......... 286,752
-------------
RETAIL TRADE - 1.9%
STONE, CLAY, GLASS & CONCRETE - 0.8%
400,000 Owens-Illinois, Inc., 7.350% 5/15/08................. 354,724
-------------
FOOD STORES - 1.1%
550,000 Kroger Co., 7.000% 5/1/18............................ 467,594
-------------
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 6.0%
GENERAL MERCHANDISE STORES - 0.1%
30,000 Wal-Mart Stores, Inc., 8.000% 9/15/06................ 30,738
-------------
ELECTRIC SERVICES - 0.4%
200,000 PacifiCorp, 6.375% 5/15/08........................... 182,916
-------------
TELECOMMUNICATION - 5.5%
650,000 CBS Corp., 7.150% 5/20/05............................ 628,399
590,000 GTE South, Inc., 6.000% 2/15/08...................... 526,386
550,000 SBC Communications, Inc., 6.250% 3/1/05.............. 519,772
660,000 US West Communications, 6.625% 9/15/05............... 625,337
-------------
2,299,894
-------------
</TABLE>
See notes to investment portfolio.
24
<PAGE> 27
CRABBE HUSON MANAGED INCOME & EQUITY FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
PAR VALUE
-------------- ----------------------------------------------------- --------------
CORPORATE FIXED INCOME BONDS & NOTES (CONTINUED)
---------------------------------------------------------------------------------------
<C> <S> <C>
WHOLESALE TRADE - 0.1%
NONDURABLE GOODS
30,000 Sysco Corp., 7.000% 5/1/06........................... $ 29,111
-------------
Total Corporate Fixed Income Bonds & Notes
(cost of $11,356,278) 7,897,234
-------------
Total Investments
(cost of $37,741,472)(b) 40,353,480
-------------
<CAPTION>
SHORT-TERM OBLIGATIONS - 3.6%
-----------------------------
<C> <S> <C>
1,498,000 Repurchase Agreement with SBC Warburg Ltd., dated
04/28/00, due 05/01/00 at 5.710%, collateralized by
U.S. Treasury notes with various maturities to
2025, market value $1,532,538 (repurchase proceeds
$1,498,713)........................................ 1,498,000
-------------
OTHER ASSETS & LIABILITIES, NET - 0.1% 35,538
-------------
NET ASSETS - 100.0% $41,887,018
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing.
(b) Cost for federal income tax purposes is the same.
See notes to financial statements.
25
<PAGE> 28
CRABBE HUSON REAL ESTATE INVESTMENT FUND
The six-month period ended April 30, 2000, brought marked improvements in the
market for real estate-related securities and for Crabbe Huson Real Estate
Investment Fund. For the half-year, Class A shares of the Fund gained 9.52%
without a sales charge, while the NAREIT Equity Index advanced 10.91%.
A RESPITE AFTER DIFFICULT TIMES
Following difficult years in 1998 and 1999, the real estate segment of the stock
market has rebounded so far in 2000, but not without a final struggle. Prices of
real estate investment trusts (REITs) and other real estate-related stocks hit
all-time lows in December 1999, due to two factors. First, in an environment
that favored most anything "high tech," investors scorned low-tech real estate.
Second, investors sold real estate-related securities in large numbers just
before year-end 1999, presumably to lock in tax losses and offset capital gains
incurred from investments in other sectors of the market.
Demand and prices picked up, however, as the market turned in March 2000 and
investors began looking for alternatives to technology, telecommunication and
other high-tech stocks -- areas of the market that had become quite unstable.
Value sectors like real estate that are less volatile than the broad market
benefited from the change in sentiment.
SEEKING TO STAY ONE STEP AHEAD
Normally, we seek to add value by focusing on the less popular equities in the
sector. We use diligent, bottom-up research to identify attractive but
out-of-favor or overlooked companies. Ideally, we find these securities when
they are selling near the bottom of their 52-week trading range and before a
catalyst for price appreciation brings them to the market's attention. A good
example of this is Spieker Properties. We acquired Spieker, an owner of office
and industrial properties on the West Coast, when that region of the country was
distressed by the Asian economic crisis of 1998. We liquidated our position this
year, when investors returned to the real estate sector and the stock price hit
our target level.
The dismal situation in the real estate sector last November and December
offered us a rare opportunity to shift our focus from less-popular REITs to
larger, better-known ones. With the entire sector depressed, we were able to buy
shares of Boston Properties Inc. (3.4% of net assets) and other high-quality
players at very attractive prices. We believed the entire sector had been sold
down to levels well below the value of the underlying properties. We also
reasoned once investors recognized this imbalance, money could flow back to the
sector, going first to the better-known stocks. The half-dozen stocks in this
higher-quality group have sharply outperformed the real estate sector since
December 1999.
Matters have not turned out as well for our investment in Trammell Crow (4.5% of
net assets), a quality company whose primary driver of growth is outsourcing
real estate services to institutions and corporations. The company assumes
responsibility for managing a client's real estate portfolio and has a strong
track record of reducing
26
<PAGE> 29
CRABBE HUSON REAL ESTATE INVESTMENT FUND
clients' operating costs. It has met or exceeded all but one quarterly earnings
estimate since becoming a public company three years ago. Nonetheless, the stock
price has languished since we purchased it in the summer of 1999. We continue to
believe matters will improve once investors learn about this little-known
success story. We will wait for the situation to work itself out.
After the real estate sector returned to favor in 2000, we changed tactics
again, returning to our typical emphasis on lesser-known names. If investors
continue to seek shelter from pricey and volatile stocks in the coming months,
we would expect the interest in real estate equities to broaden and embrace
these less popular but still fundamentally sound securities.
A POSITIVE OUTLOOK
There are many valuable but undervalued companies in the real estate sector. In
the strong economic environment of the past several years, balance sheets of
REITs and other real estate-related companies have improved considerably. In
addition, most segments of the real estate market are operating in a relative
equilibrium of supply and demand and have very good prospects for sustainable
growth. Earnings projections point toward another year of healthy profits for
the sector. In our view, real estate stocks continue to offer very good,
long-term potential.
/s/ Michael B. Stokes, CFA
Michael B. Stokes, CFA
------------------------
An investment in the Fund may be subject to certain risks associated with
ownership of real estate such as possible declines in value, environmental
problems, natural disasters, changes in interest rates and local economic
conditions. The Fund may be affected by stock market fluctuations that occur in
response to economic and business developments.
27
<PAGE> 30
CRABBE HUSON REAL ESTATE INVESTMENT FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
INCEPTION DATE 4/1/1994 1/27/1999 1/27/1999 1/29/1999
SHARE CLASS A B C Z
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C>
Cumulative
Six months 9.52% 4.32% 9.10% 4.10% 9.11% 8.11% 9.54%
One year (3.00)% (7.60)% (3.57)% (8.10)% (3.66)% (4.57)% (2.75)%
Five years 9.84% 8.78% 9.66% 9.38% 9.64% 9.64% 9.90%
Life of Fund 7.70% 6.84% 7.55% 7.44% 7.54% 7.54% 7.75%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<CAPTION>
SHARE CLASS A B C Z
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT
SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C>
Cumulative
Six months 1.22% (3.59)% 0.94% (3.88)% 0.94% (0.02)% 1.45%
One year 0.48% (4.29)% (0.09)% (4.79)% (0.09)% (1.03)% 0.85%
Five years 8.34% 7.29% 8.18% 7.89% 8.16% 8.16% 8.42%
Life of Fund 6.70% 5.84% 6.57% 6.46% 6.55% 6.55% 6.77%
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 4.75% sales charge for Class A shares, the appropriate Class B
contingent deferred sales charge for the holding period after purchase as
follows: through first year-5%, second year-4%, third year-3%, fourth year-3%,
fifth year-2%, sixth year-1%, thereafter-0% and the Class C contingent deferred
sales charge of 1% for the first year only. Performance for different share
classes will vary based on differences in sales charges and fees associated with
each class.
Performance results reflect any voluntary waivers or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class B, C and Z shares (newer class shares) performance information includes
returns of the Fund's Class A shares (the oldest existing fund class) for
periods prior to its inception date. These Class A share returns are not
restated to reflect any expense differential (e.g., Rule 12b-1 fees) between
Class A shares and the newer class shares. Had the expense differential been
reflected, the returns for the periods prior to the inception of Class B and
Class C shares would have been lower.
28
<PAGE> 31
CRABBE HUSON REAL ESTATE INVESTMENT FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS - 89.6%
-----------------------------------------------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE - 89.6%
APARTMENTS - 5.8%
11,900 Archstone Communities Trust.......................... $ 257,336
6,617 Camden Property Trust................................ 187,757
-------------
445,093
-------------
DIVERSIFIED - 12.7%
15,900 Castle & Cook Inc.(a)................................ 288,187
8,200 Catellus Development Corp.(a)........................ 106,600
7,700 Golf Trust of America Inc.(a)........................ 132,825
21,000 Kennedy Wilson Inc.(a)............................... 102,375
26,400 Trammell Crow Co.(a)................................. 343,200
-------------
973,187
-------------
FACTORY OUTLETS - 2.0%
8,100 Pan Pacific Retail Properties, Inc. ................. 153,900
-------------
HEALTHCARE - 2.3%
9,725 Healthcare Realty Trust, Inc. ....................... 175,050
-------------
INDUSTRIAL - 16.3%
19,000 AMB Property Corp. .................................. 419,187
5,000 BRE Properties Inc. Class A.......................... 139,687
7,400 Boston Properties Inc. .............................. 258,075
7,700 Colonial Properties Trust............................ 192,019
12,000 Prologis Trust....................................... 236,250
-------------
1,245,218
-------------
LODGING - 5.2%
22,500 RFS Hotel Investors Inc.............................. 272,812
30,000 Silverleaf Resorts, Inc.(a).......................... 127,500
-------------
400,312
-------------
MANUFACTURED HOMES - 5.7%
17,000 Asset Investors Corp. ............................... 199,750
46,100 Commercial Assets, Inc. ............................. 233,381
-------------
433,131
-------------
OFFICE - 11.4%
15,800 Equity Office Properties Trust....................... 429,562
9,100 Kilroy Realty Corp. ................................. 219,537
14,000 Trizechahn Corp. .................................... 227,508
-------------
876,607
-------------
REGIONAL MALLS - 14.6%
11,700 Crown American Realty................................ 65,081
12,650 Glimcher Realty Trust................................ 173,937
</TABLE>
See notes to investment portfolio.
29
<PAGE> 32
CRABBE HUSON REAL ESTATE INVESTMENT FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
SHARES VALUE
-------------- ----------------------------------------------------- --------------
COMMON STOCKS - 89.6%
-----------------------------------------------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE (CONTINUED)
REGIONAL MALLS (CONTINUED)
14,500 JDN Realty Corp. .................................... $ 140,469
8,600 Philips International Realty......................... 141,362
9,640 Simon Properties Group, Inc. ........................ 244,615
15,000 Taubman Centers Inc. ................................ 179,062
5,000 Vornado Realty Trust................................. 172,500
-------------
1,117,026
-------------
STORAGE - 7.9%
27,100 Public Storage, Inc. ................................ 606,361
-------------
TRIPLE NET LEASE - 5.7%
22,500 Correctional Properties Trust........................ 267,187
7,000 Franchise Finance Corp. of America................... 166,250
-------------
433,437
-------------
Total Common Stocks
(cost of $7,220,253)(b) 6,859,322
-------------
<CAPTION>
PAR SHORT-TERM INVESTMENTS - 5.5%
-------------- -----------------------------
<C> <S> <C>
$424,000 Repurchase agreement with SBC Warburg Ltd., dated
04/28/00, due 05/01/00 at 5.710%, collateralized by
U.S. Treasury notes with various maturities to
2025, market value $433,776 (repurchase proceeds
$424,202).......................................... 424,000
-------------
OTHER ASSETS & LIABILITIES - 4.9% 372,097
-------------
NET ASSETS - 100.0% $7,655,419
-------------
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing.
(b) Cost for federal income tax purposes is the same.
30
<PAGE> 33
CRABBE HUSON SMALL CAP FUND
STRONG PERFORMANCE FOR FIRST HALF OF FISCAL 2000
Crabbe Huson Small-Cap Fund generated a total return of 34.93% for the six
months ended April 30, 2000, based on Class A shares before sales charges. By
comparison, the six-month total return for the Russell 2000 Index was 18.72%.
The strong results for the Fund and small caps in general can be attributed
primarily to a rapid change in investor sentiment.
TECHNOLOGY LEADS THE SMALL-CAP MARKET
After virtually ignoring small-cap stocks for several years, investors had a
change of heart in the fall of 1999 and turned a favorable eye on this portion
of the market, particularly technology and telecommunications stocks. Prices of
many technology-related stocks -- especially Internet-related stocks and new
public offerings -- soared between last October and early March 2000. However,
the love affair with technology cooled dramatically after March 2000, in part
because stock prices in the sector had reached unjustifiable levels.
As contrarians, we avoid the highest-P/E stocks in favor of the less expensive
issues. Most of these were providers of hardware, software and components, many
of which we had purchased long before technology rotated into favor. A good
example of this was Actel Corp. (3.0% of net assets), the Fund's best-performing
holding during the six-month period. We added Actel, a manufacturer of
field-programmable gate arrays, to the portfolio several years ago. The company
had a strong product line but was undervalued because investors felt it could
not compete effectively against larger, more established companies. Since then,
Actel has made major inroads with its competitors' largest customers, bringing
it to the market's attention while technology began to soar. At April 30, the
stock's price was more than 200% above our cost per share.
As technology stock prices rose, we liquidated or trimmed many of the Fund's
positions, taking profits along the way. This, combined with the emphasis on
lesser-valued technology companies, both helped and hurt performance. The Fund
missed out on the astronomical gains that the higher-flying companies posted
before March, but it also was spared the worst of the rapid deflation of these
stocks that followed.
FUND POSITIONED FOR CONTINUED ECONOMIC GROWTH
At the period's inception, many investors were concerned that interest rate
increases by the Federal Reserve would drag the rapidly expanding economy into a
recession. We did not agree with this viewpoint and positioned the Fund in
undervalued small-cap companies that we felt would benefit from continued
economic growth. After technology, the Fund's largest sector allocations were
services, energy and health care. Results for all three groups were lackluster.
Many of the Fund's energy holdings are natural gas exploration, production or
service companies. With continued growth of the economy, production at low
levels, and reserves nearly depleted, it appears likely gas production must
increase in the
31
<PAGE> 34
CRABBE HUSON SMALL CAP FUND
foreseeable future, a change that would positively impact revenues and earnings
for natural gas companies. Yet there are few interested buyers for these stocks.
Although the sector has languished, we have maintained our above-average
weighting in the belief it is overdue for a comeback. We perceive several
potential catalysts for change, including possible industry consolidation.
Circumstances in the health care industry have improved since last October, but
most of the Fund's holdings remain below our target price levels. After
succumbing to problems brought on by federal government spending cuts in the
past two years, the sector is slowly regaining strength. More recently, the
Clinton Administration has indicated it may ease its stance on health care.
MORE ECONOMIC GROWTH TO COME
We continue to think the robust U.S. economy will not be stopped easily. Thus,
we expect to see more of what occurred in the past six months: a broadening of
the market to embrace areas that have been shunned, and a swift correction to
any sector that becomes overvalued too quickly. If we are correct, investor
interest in small caps should continue to grow, which would bode well for the
Fund. In the meantime, we will, as always, do our best to identify and purchase
undervalued small caps, whether they are considered "growth" or "value," before
a catalyst for change brings them to or returns them to favor with investors.
For instance, as the period drew to a close, we were actively investing in
small-cap technology stocks that had been abandoned by the market. While these
are considered growth stocks, many had declined to as much as 75% below their
recent highs -- traditionally "value" territory. The low price, combined with
the potential for a rebound once the worst of the technology-centered correction
is over, makes them ideal at this point for our contrarian style of investing.
/s/ James E. Crabbe /s/ John W. Johnson, CFA
James E. Crabbe John W. Johnson, CFA
------------------------
Investing in small-cap stocks may present special risks including possible
illiquidity and greater price volatility than stocks of larger, more established
companies.
32
<PAGE> 35
CRABBE HUSON SMALL CAP FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
INCEPTION DATE 2/16/1996 10/10/1996
SHARE CLASS A I
WITHOUT WITH WITHOUT
SALES SALES SALES
CHARGE CHARGE CHARGE
<S> <C> <C> <C>
Cumulative
Six months 34.93% 27.17% 35.00%
One year 25.66% 18.43% 26.23%
Life of Fund 5.00% 3.53% 5.35%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<CAPTION>
SHARE CLASS A I
WITHOUT WITH WITHOUT
SALES SALES SALES
CHARGE CHARGE CHARGE
<S> <C> <C> <C>
Cumulative
Six months 25.24% 18.04% 25.38%
One year 47.45% 38.97% 47.78%
Life of Fund 6.44% 4.93% 6.79%
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 5.75% charge for Class A shares. Class I shares (institutional
shares) are offered without sales charges or contingent deferred sales charges.
Performance for different share classes will vary based on differences in sales
charges and fees associated with each class.
Performance results reflect any voluntary waivers or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class I share performance information includes returns of the Fund's Class A
shares for periods prior to its inception date. These Class A share returns are
not restated to reflect any expense differential (e.g. Rule 12b-1 fees) between
Class A shares and Class I shares.
33
<PAGE> 36
CRABBE HUSON SMALL CAP FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
SHARES COMMON STOCKS -- 97.1% VALUE
-------------- ---------------------- --------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE - 6.0%
INSURANCE CARRIERS - 6.0%
33,900 Fidelity National Financial, Inc. ................... $ 500,025
32,000 Risk Capital Holdings, Inc.(a)....................... 492,500
28,200 StanCorp Financial Group, Inc........................ 821,325
-------------
1,813,850
-------------
MANUFACTURING - 35.1%
APPAREL - 8.1%
111,200 Oakley, Inc.(a)...................................... 1,278,800
91,400 Phillips-Van Heusen Corp............................. 771,188
38,600 The Warnaco Group, Inc., Class A..................... 410,125
-------------
2,460,113
-------------
CHEMICALS & ALLIED PRODUCTS - 2.5%
9,700 Barr Laboratories, Inc.(a)........................... 418,919
15,500 Wellman, Inc. ....................................... 331,313
-------------
750,232
-------------
ELECTRICAL INDUSTRIAL EQUIPMENT - 3.0%
24,700 Actel Corp.(a)....................................... 909,269
-------------
ELECTRONIC & ELECTRICAL EQUIPMENT - 2.3%
77,900 Checkpoint Systems, Inc.............................. 696,231
-------------
ELECTRONIC COMPONENTS - 3.2%
155,900 HMT Technology Corp.(a).............................. 353,211
29,700 Rayovac Corp.(a)..................................... 619,988
-------------
973,199
-------------
MACHINERY & COMPUTER EQUIPMENT - 3.0%
118,400 Auspex Systems, Inc.(a).............................. 902,800
-------------
MEASURING & ANALYZING INSTRUMENTS - 0.5%
56,600 Flanders Corp.(a).................................... 155,650
-------------
PAPER PRODUCTS - 1.6%
38,400 Longview Fibre Co.................................... 489,600
-------------
PRIMARY METAL - 5.5%
59,300 Century Aluminum Co. ................................ 830,200
56,600 Ispat International NV, NY Registered Shares......... 661,513
14,100 UCAR International, Inc.(a).......................... 185,944
-------------
1,677,657
-------------
PRINTING & PUBLISHING - 2.1%
71,900 Mail-Well, Inc.(a)................................... 642,606
-------------
</TABLE>
See notes to investment portfolio.
34
<PAGE> 37
CRABBE HUSON SMALL CAP FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
SHARES COMMON STOCKS (CONTINUED) VALUE
-------------- ------------------------- --------------
<C> <S> <C>
MANUFACTURING (CONTINUED)
RUBBER & PLASTIC - 1.2%
27,600 Cooper Tire & Rubber Co. ............................ $ 372,600
-------------
TRANSPORTATION EQUIPMENT - 2.0%
40,500 Wabash National Corp. ............................... 589,781
-------------
MINING & ENERGY - 15.2%
OIL & GAS EXTRACTION - 5.9%
63,200 Forest Oil Corp.(a).................................. 707,050
79,700 Santa Fe Snyder Corp.(a)............................. 732,244
18,600 Tom Brown, Inc.(a)................................... 353,400
-------------
1,792,694
-------------
OIL & GAS FIELD SERVICES - 9.2%
358,200 Grey Wolf, Inc.(a)................................... 1,455,187
93,100 Input/Output, Inc.(a)................................ 686,613
35,500 Nuevo Energy Co.(a).................................. 621,250
-------------
2,763,050
-------------
SERVICES - 24.2%
AMUSEMENT & RECREATION - 0.9%
6,400 Anchor Gaming(a)..................................... 257,600
-------------
BUSINESS SERVICES - 0.9%
20,500 Daleen Technologies, Inc.(a)......................... 269,062
-------------
COMPUTER RELATED SERVICES - 6.2%
64,200 Mentor Graphics Corp.(a)............................. 842,625
46,700 Sensormatic Electronics Corp. ....................... 779,306
37,800 Sitel Corp.(a)....................................... 259,875
-------------
1,881,806
-------------
COMPUTER SOFTWARE - 1.2%
10,800 CCC Information Services Group, Inc.(a).............. 149,850
14,600 Unova, Inc.(a)....................................... 204,400
-------------
354,250
-------------
EDUCATIONAL SERVICES - 1.4%
23,800 ITT Educational Services, Inc.(a).................... 425,425
-------------
HEALTH SERVICES - 11.7%
20,400 Covance, Inc.(a)..................................... 187,425
86,900 Coventry Health Care Inc.(a)......................... 923,312
18,200 IDEXX Laboratories, Inc.(a).......................... 477,750
</TABLE>
See notes to investment portfolio.
35
<PAGE> 38
CRABBE HUSON SMALL CAP FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
SHARES COMMON STOCKS (CONTINUED) VALUE
-------------- ------------------------- --------------
<C> <S> <C>
SERVICES (CONTINUED)
99,600 Mid Atlantic Medical Services, Inc.(a)............... $ 927,525
29,900 Omnicare, Inc. ...................................... 454,106
75,100 Vysis, Inc.(a)....................................... 558,556
-------------
3,528,674
-------------
MOTION PICTURES - 1.2%
50,800 Hollywood Entertainment Corp.(a)..................... 355,600
-------------
PERSONAL SERVICES - 0.7%
17,200 Regis Corp. ......................................... 201,025
-------------
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 14.3%
AIR TRANSPORTATION - 3.1%
15,800 Alaska Air Group..................................... 454,250
31,400 Frontier Airlines, Inc.(a)........................... 478,850
-------------
933,100
-------------
GAS SERVICES - 1.5%
26,788 Western Gas Resources, Inc. ......................... 447,025
-------------
MOTOR FREIGHT & WAREHOUSING - 5.1%
53,900 Budget Group, Inc., Class A(a)....................... 252,656
23,900 J.B. Hunt Transport Services, Inc. .................. 394,350
46,800 Yellow Corp. ........................................ 892,125
-------------
1,539,131
-------------
TELECOMMUNICATION - 3.4%
55,000 E. Spire Communications, Inc.(a)..................... 278,437
113,000 PictureTel Corp.(a).................................. 480,250
24,700 WebLink Wireless, Inc.(a)............................ 280,963
-------------
1,039,650
-------------
TRANSPORTATION SERVICES - 1.2%
37,900 Fritz Companies, Inc.(a)............................. 364,787
-------------
WHOLESALE TRADE - 2.3%
NONDURABLE GOODS
41,300 Fleming Co., Inc. ................................... 678,869
-------------
Total Common Stock
(cost of $33,946,593)(b) 29,265,336
-------------
</TABLE>
See notes to investment portfolio.
36
<PAGE> 39
CRABBE HUSON SMALL CAP FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
PAR SHORT-TERM OBLIGATIONS - 1.6% VALUE
-------------- ----------------------------- --------------
<C> <S> <C>
$472,000 Repurchase agreement with SBC Warburg Ltd., dated
04/28/00, due 5/1/00 at 5.710%, collateralized by
U.S. Treasury notes with various maturities to
2025, market value $482,882 (repurchase proceeds
$472,225).......................................... $ 472,000
-------------
OTHER ASSETS & LIABILITIES, NET - 1.3% 403,258
-------------
NET ASSETS - 100.0% $30,140,594
-------------
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing.
(b) Cost for federal income tax purposes is the same.
See notes to financial statements.
37
<PAGE> 40
CRABBE HUSON SPECIAL FUND
A STRONG SIX-MONTH RETURN DESPITE A VOLATILE MARKET
After virtually ignoring small-cap stocks for several years, investors had a
change of heart in the fall of 1999 and turned a favorable eye on this portion
of the market, particularly technology and telecommunications stocks. Although
investors' love affair with technology cooled dramatically after March 2000, the
small-cap segment of the market and the Crabbe Huson Special Fund delivered very
good results for the six months ended April 30, 2000. Class A shares of the Fund
posted a total return of 33.57%, compared to a gain of 18.72% for the Russell
2000 Index.
FUND WAS POSITIONED FOR CONTINUED ECONOMIC GROWTH
At the period's inception, many investors were concerned that interest rate
increases by the Federal Reserve would drag the rapidly expanding economy into a
recession. We did not agree with this viewpoint and positioned the Fund in
undervalued small-and mid-cap companies we felt would benefit from continued
economic growth.
TRUCKING PERFORMS EXCEPTIONALLY WELL
The trucking industry has grown increasingly prosperous with the prolonged
economic expansion. Yet the market, concerned about the impact of higher prices
for gasoline, all but ignored these investments until recently. As contrarians,
we saw the market's disdain as an opportunity to buy stocks in this group, while
demand and prices were low. We focused on companies with good earnings growth
prospects, such as Yellow Corporation (5.7% of net assets). Yellow imposes fuel
surcharges on its customers and has not been adversely affected by higher fuel
costs. At April 30, the stock price was 62% higher than the Fund's cost per
share.
Another company that performed well was Century Aluminum (4.8% of net assets).
The company's stock price was severely depressed until Century sold its
fabrication facilities for more than the entire market value of the company and
reinvested the proceeds in its core aluminum production business. The move
caught the market's attention, and the stock price rapidly climbed 50%. While
Century remains noticeably undervalued, we anticipate further improvements. With
the present shortage of physical inventory in the aluminum industry, any
increase in demand could make the stock more attractive to investors.
CHALLENGING TIMES FOR ENERGY AND HEALTH CARE
Against a backdrop of skepticism, the Fund's energy holdings generally performed
poorly, but we have maintained our above-average weighting, in the belief that
the sector is overdue for a comeback. For instance, with continued growth of the
economy, natural gas reserves down, and production at low levels, it appears
likely that production must increase. Increased production would positively
impact revenues and earnings for energy stocks. Yet there are few interested
buyers. Although the sector has languished until recently, we perceive several
potential catalysts for change, including possible industry consolidation.
38
<PAGE> 41
CRABBE HUSON SPECIAL FUND
In the health care industry, circumstances have improved since last October, but
most of the Fund's holdings remain below our target price levels. The industry
has battled tremendous headwinds from the Federal government over the past two
years. Over the past six months, we repositioned assets in several lesser-known
but promising HMOs and other service providers. More recently, the Clinton
Administration has indicated it may ease its stance on health care.
RAPID CHANGES FOR TECHNOLOGY STOCKS
When it comes to technology, it is hard to talk about "unpopular" stocks.
Throughout most of the period, nearly all technology or telecommunications
stocks, whether profitable or not, had a following. As contrarians, we avoided
the highest-P/E stocks -- such as Internet companies and new public
offerings -- in favor of the less-expensive providers of hardware, software and
components. As prices rose, we also liquidated or trimmed many of the Fund's
technology positions, taking profits along the way. The emphasis on
lesser-valued companies both helped and hurt performance. The Fund missed out on
the astronomical gains that higher-flying companies posted before March, but it
also was spared the worst of the rapid deflation that followed.
MORE ECONOMIC GROWTH TO COME
We continue to think that the robust U.S. economy will not be stopped easily.
Thus, we expect to see more of what occurred in the past six months: a
broadening of the market to embrace areas that have been shunned, and a swift
correction to any sector that becomes overvalued too quickly. If we are correct,
investor interest in small- and mid-cap companies will continue to grow, which
would bode well for the Fund. In the meantime, we will, as always, do our best
to identify and purchase undervalued growth or value stocks before a catalyst
for change brings them to or returns them to favor with investors.
<TABLE>
<S> <C>
/s/ John Johnson /s/ James E. Crabbe
John W. Johnson, CFA James E. Crabbe
</TABLE>
------------------------
Investing in small-cap stocks may present special risks, including possible
illiquidity and greater price volatility than stocks of larger, more established
companies. In addition, short sales involve the risk that losses may be
exaggerated, potentially losing more money than the actual cost of the security.
39
<PAGE> 42
CRABBE HUSON SPECIAL FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
4/9/1987
INCEPTION DATE
SHARE CLASS - A
WITHOUT WITH
SALES SALES
CHARGE CHARGE
<S> <C> <C>
Cumulative
Six months 33.57% 25.89%
One year 6.77% 0.63%
Five years (4.34)% (5.46)%
10 years 8.13% 7.49%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<CAPTION>
SHARE CLASS - A
WITHOUT WITH
SALES SALES
CHARGE CHARGE
<S> <C> <C>
Cumulative
Six months 20.12% 13.21%
One year 38.41% 30.45%
Five years (2.74)% (3.89)%
10 years 8.44% 7.80%
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 5.75% charge for Class A shares.
Performance results reflect any voluntary waivers or reimbursement of Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
40
<PAGE> 43
CRABBE HUSON SPECIAL FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
SHARES COMMON STOCKS - 102.5% VALUE
-------------- ---------------------- --------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE - 6.3%
INSURANCE CARRIERS - 6.3%
144,700 Risk Capital Holdings, Inc.(a)....................... $ 2,227,023
20,000 StanCorp Financial Group, Inc. ...................... 582,500
-------------
2,809,523
-------------
MANUFACTURING - 43.7%
APPAREL - 8.5%
194,300 Oakley, Inc.(a)...................................... 2,234,450
186,000 Phillips-Van Heusen Corp. ........................... 1,569,375
-------------
3,803,825
-------------
CHEMICALS & ALLIED PRODUCTS - 1.7%
34,600 Wellman, Inc. ....................................... 739,575
-------------
ELECTRICAL INDUSTRIAL EQUIPMENT - 3.1%
37,000 Actel Corp.(a)....................................... 1,362,063
-------------
ELECTRONIC & ELECTRICAL EQUIPMENT - 2.4%
119,900 Checkpoint Systems, Inc. ............................ 1,071,606
-------------
ELECTRONIC COMPONENTS - 1.7%
331,400 HMT Technology Corp.(a).............................. 750,828
-------------
MACHINERY & COMPUTER EQUIPMENT - 5.1%
300,000 Auspex Systems, Inc.(a).............................. 2,287,500
-------------
PAPER PRODUCTS - 8.3%
287,300 Longview Fibre Co. .................................. 3,663,075
-------------
PRIMARY METALS - 8.1%
151,900 Century Aluminum Co. ................................ 2,126,600
126,000 Ispat International NV, NY Registered Shares......... 1,472,625
-------------
3,599,225
-------------
PRINTING & PUBLISHING - 0.9%
43,300 Mail-Well, Inc.(a)................................... 386,994
-------------
TRANSPORTATION EQUIPMENT - 3.9%
118,000 Wabash National Corp. ............................... 1,718,375
-------------
MINING & ENERGY - 20.7%
OIL & GAS EXTRACTION - 9.1%
194,200 Forest Oil Corp.(a).................................. 2,172,613
199,965 Santa Fe Snyder Corp.(a)............................. 1,837,178
-------------
4,009,791
-------------
OIL & GAS FIELD SERVICES - 11.6%
924,900 Grey Wolf, Inc.(a)................................... 3,757,406
82,000 Nuevo Energy Co.(a).................................. 1,435,000
-------------
5,192,406
-------------
</TABLE>
See notes to investment portfolio.
41
<PAGE> 44
CRABBE HUSON SPECIAL FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
SHARES COMMON STOCKS (CONTINUED) VALUE
-------------- ------------------------- --------------
<C> <S> <C>
SERVICES - 17.6%
COMPUTER RELATED SERVICES - 6.4%
105,600 Mentor Graphics Corp.(a)............................. $ 1,386,000
87,000 Sensormatic Electronics Corp. ....................... 1,451,813
-------------
2,837,813
-------------
HEALTH SERVICES - 11.2%
200,000 Coventry Health Care, Inc.(a)........................ 2,125,000
22,200 IDEXX Labs, Inc.(a).................................. 582,750
195,300 Mid-Atlantic Medical Services, Inc.(a)............... 1,818,731
61,500 Vysis, Inc.(a)....................................... 457,406
-------------
4,983,887
-------------
TRANSPORTATION, COMMUNICATION, ELECTRIC
GAS & SANITATION SERVICES - 10.5%
MOTOR FREIGHT & WAREHOUSING - 7.9%
60,400 J.B. Hunt Transport Services, Inc. .................. 996,600
132,600 Yellow Corp. ........................................ 2,527,688
-------------
3,524,288
-------------
TELECOMMUNICATION - 2.6%
163,900 PictureTel Corp.(a).................................. 696,575
37,700 WebLink Wireless, Inc.(a)............................ 428,838
-------------
1,125,413
-------------
WHOLESALE TRADE - 3.7%
NONDURABLE GOODS
100,700 Fleming Co., Inc. ................................... 1,655,256
-------------
Total Common Stocks
(cost of $50,865,792)(b) 45,521,443
-------------
<CAPTION>
PAR SHORT TERM OBLIGATIONS - 2.2%
-------------- -----------------------------
<C> <S> <C>
978,000 Repurchase agreement with SBC Warburg Ltd. dated
04/28/00, due 05/01/00 at 5.710%, collateralized by
U.S. Treasury notes with various maturities to
2025, market value $1,005,548 (repurchase proceeds
$978,465).......................................... 978,000
-------------
OTHER ASSETS & LIABILITIES, NET - (4.7)% (2,080,108)
-------------
NET ASSETS - 100.0% $44,419,335
-------------
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Non-income producing.
(b) Cost for federal income tax purposes is the same.
See notes to financial statements.
42
<PAGE> 45
CRABBE HUSON CONTRARIAN INCOME FUND
STRONG PERFORMANCE CONTINUES IN FISCAL 1999
We are pleased to report yet another period of strong performance for the Crabbe
Huson Contrarian Income Fund. For the six months ended April 30, 2000, an
increased investment in long-term Treasurys, a large allocation to corporate
bonds and selective use of mortgage-backed securities all helped Class A shares
of the Fund deliver a total return of 1.65% before sales charges. By comparison,
the Fund's benchmark, the Lehman Brothers Government Corporate Bond Index, had a
total return of 1.51%. The Fund's SEC yield at April 30, 2000, was 6.17%.
"SKATE TO WHERE THE PUCK IS GOING TO BE"
One highly successful hockey player has said that he skates "not to where the
puck is, but where it's going to be." It's an appropriate analogy for our
management style.
From June through November 1999, the Federal Reserve instituted three hikes in
key short-term interest rates, in an attempt to slow the rapid expansion of the
U.S. economy and prevent higher rates of inflation in the future. When inflation
rises, investors must receive more income or yield to maintain their purchasing
power. In response to the possibility of a higher cost of living, the yield on
30-year U.S. Treasurys rose from 5.0% in mid-1999 to 6.5% in January 2000.
Prices fell, and investor sentiment toward the bond market became increasingly
negative.
As contrarians, we saw the change in attitude as an opportunity. While others
sold their bond holdings, we invested, acquiring securities at relatively
attractive prices. We believe, despite where matters stood last fall, the
economy would ultimately slow, inflationary pressures would ease, and yields
would subside. In that case, bond prices would rebound, and the change would be
most pronounced for longer-term securities. For this reason, we focused on
buying intermediate- and long-term securities. The Fund's duration, a reflection
of the years until maturity of its holdings and a measure of its sensitivity to
interest rate changes, climbed from 4.4 years at October 31 to 6.0 years in
early 2000.
Just as we anticipated, yields on long-term securities began to fall after
January 2000, triggered by a buyback program from the U.S. Treasury and a slight
change in sentiment. The Treasury began using the Federal government budget
surplus to repurchase long-term Treasurys, thereby reducing the supply. In
response, investors bid up prices, forcing yields down to approximately 6.2% by
late April. In addition, two interest rate increases by the Federal Reserve in
early 2000 and evidence the U.S. economy is slowing boosted investor confidence
that inflationary pressures will abate. This also helped to take some pressure
off yields.
YIELDS ON CORPORATE SECURITIES REMAIN HIGH
Approximately one-half of the Fund's net assets are invested in corporate fixed-
income issues, including a 20% allocation to bonds rated BBB. Though still
considered investment grade, such bonds are riskier than higher-quality bonds
and generally provide higher yields as compensation for the added risk.
43
<PAGE> 46
CRABBE HUSON CONTRARIAN INCOME FUND
The difference, or spread, between yields in the government and corporate
sectors of the market has been above average since late 1998, and corporate
bonds have been strong contributors to the Fund's current income. However,
yields on corporate securities did not drop as quickly as yields on Treasurys
after January 2000. Higher interest rates may increase the cost of doing
business for corporations, a perceived risk that led investors to continue to
demand higher yields. Prices of most bonds in the sector fell.
Although corporate securities lagged behind the Treasury sector, we have
maintained our 50% position. We believe that once the Fed completes its program
of rate hikes, costs for corporations should stabilize, and the corporate bond
market may rally.
MORTGAGE-BACKED SECURITIES PROVIDE STEADY SOURCE OF INCOME
We use mortgage-backed securities (MBSs) primarily as tools for capturing
incremental yield for the Fund. Of the 20% of the Fund's net assets invested in
MBSs as of April 30, the bulk comprised obligations from the Government National
Mortgage Association. Because these are backed by the full faith and credit of
the U.S. government, their prices are less susceptible to interest rate changes.
STILL CAUTIOUS BUT HOPEFUL
As the six months ended, we were cautiously optimistic. The U.S. economy appears
to be less robust, and the Federal Reserve seems determined to tighten monetary
policy until that becomes a certainty. We see these as indications the bond
market may return to favor in the foreseeable future. Provided there are no
major surprises in the key inflation indicators, we plan to maintain our present
sector allocations and a duration that is higher than that of the benchmark
index.
<TABLE>
<S> <C>
/s/ Garth R. Nisbet /s/ Paul C. Rocheleau
Garth R. Nisbet, CFA Paul C. Rocheleau
</TABLE>
------------------------
An investment in the Fund offers attractive income and total return
opportunities, but also involves certain risks. The value of an investment in
the Fund will fluctuate with changes in interest rates.
44
<PAGE> 47
CRABBE HUSON CONTRARIAN INCOME FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
INCEPTION DATE 1/31/1989 9/15/1999 9/15/1999 10/1/1998 9/15/1999
SHARE CLASS A B C I Z
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITHOUT
SALES SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Cumulative Six
months 1.65% (3.18)% 1.36% (3.60)% 1.04% 0.05% 1.65% 1.44%
One year 1.07% (3.73)% 0.60% (4.20)% 0.55% (0.40)% 1.32% 0.99%
Five years 7.23% 6.20% 7.13% 6.83% 7.12% 7.12% 7.38% 7.22%
10 years 7.16% 6.64% 7.11% 7.11% 7.10% 7.10% 7.23% 7.15%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<CAPTION>
SHARE CLASS A B C I Z
WITHOUT WITH WITHOUT WITH WITHOUT WITH WITHOUT WITHOUT
SALES SALES SALES SALES SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Cumulative Six
months 2.32% (2.54)% 2.09% (2.91)% 2.00% 1.00% 2.60% 2.47%
One year 2.05% (2.80)% 1.73% (3.11)% 1.67% 0.71% 2.41% 2.26%
Five years 7.63% 6.59% 7.56% 7.26% 7.55% 7.55% 7.79% 7.67%
10 years 7.17% 6.65% 7.14% 7.14% 7.13% 7.13% 7.25% 7.19%
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 4.75% sales charge for Class A shares, the appropriate Class B
contingent deferred sales charge for the holding period after purchase as
follows: through first year-5%, second year-4%, third year-3%, fourth year-3%,
fifth year-2%, sixth year-1%, thereafter-0% and the Class C contingent deferred
sales charge of 1% for the first year only. Class I shares (institutional
shares) are offered without sales charges or contingent deferred sales charges.
Performance for different share classes will vary based on differences in sales
charges and fees associated with each class.
Performance results reflect any voluntary waivers or reimbursement to Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class B, C, I and Z share (newer class shares) performance information includes
returns of the Fund's Class A shares (the oldest existing fund class) for
periods prior to its inception date. These Class A share returns are not
restated to reflect any expense differential (e.g., Rule 12b-1 fees) between
Class A shares and the newer class shares. Had the expense differential been
reflected, the returns for the periods prior to the inception of Class B and
Class C shares would have been lower.
45
<PAGE> 48
CRABBE HUSON CONTRARIAN INCOME FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR CORPORATE FIXED INCOME BONDS - 50.5% VALUE
-------------- ------------------------------------ --------------
<C> <S> <C>
FINANCE, INSURANCE & REAL ESTATE - 12.5%
DEPOSITORY INSTITUTIONS - 2.5%
$ 100,000 Citicorp,
6.375% 11/15/08.................................... $ 91,371
100,000 J.P. Morgan & Co., Inc.,
7.625% 9/15/04..................................... 99,851
-------------
191,222
-------------
INSURANCE CARRIERS - 1.7%
50,000 Conseco, Inc.,
7.875% 12/15/00.................................... 38,000
100,000 Lincoln National Corp.,
6.500% 3/15/08..................................... 89,862
-------------
176,004
-------------
NONDEPOSITORY CREDIT INSTITUTIONS - 6.4%
100,000 American Express Credit Corp.,
6.500% 8/1/00...................................... 99,954
50,000 American General Finance Corp.,
6.200% 3/15/03..................................... 48,142
100,000 Ford Motor Credit Co.,
6.250% 11/8/00..................................... 99,585
100,000 General Motors Acceptance Corp.,
9.000% 10/15/02.................................... 103,327
100,000 Household Finance Corp.,
6.000% 5/8/00...................................... 99,992
50,000 Sears, Roebuck & Co. Acceptance Corp.,
6.930% 11/15/02.................................... 48,825
-------------
499,825
-------------
SECURITY BROKERS & DEALERS - 1.9%
100,000 Bear Stearns Cos., Inc.,
6.875% 10/1/05..................................... 95,191
50,000 Merrill Lynch & Co., Inc.,
6.020% 5/11/01..................................... 49,403
-------------
144,594
-------------
MANUFACTURING - 14.9%
CHEMICALS & ALLIED PRODUCTS - 3.9%
100,000 E.I. DuPont De Nemours & Co.,
8.250% 9/15/06..................................... 103,016
100,000 Eli Lilly & Co.,
8.375% 12/1/06..................................... 104,499
100,000 IMC Global, Inc.,
7.400% 11/1/02..................................... 98,400
-------------
305,915
-------------
</TABLE>
46
<PAGE> 49
CRABBE HUSON CONTRARIAN INCOME FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR CORPORATE FIXED INCOME BONDS (CONTINUED) VALUE
-------------- ---------------------------------------- --------------
<C> <S> <C>
MANUFACTURING (CONTINUED)
FABRICATED METAL - 1.1%
$ 90,000 Snap-on, Inc.,
6.625% 10/1/05..................................... $ 86,139
-------------
FOOD & KINDRED PRODUCTS - 3.8%
100,000 Anheuser Busch Cos., Inc.,
7.000% 9/1/05...................................... 96,321
100,000 Diageo Capital Place,
7.250% 11/1/09..................................... 97,159
100,000 PepsiCo, Inc.,
5.875% 6/1/00...................................... 99,970
-------------
293,450
-------------
MACHINERY & COMPUTER EQUIPMENT - 3.4%
International Business Machines Corp.:
100,000 5.945% 5/14/01....................................... 98,919
100,000 7.250% 11/1/02....................................... 99,741
75,000 Raytheon Co.,
6.150% 11/1/08..................................... 64,420
-------------
263,080
-------------
MISCELLANEOUS MANUFACTURING - 0.6%
50,000 Cooper Industries, Inc.,
6.375% 5/8/08...................................... 45,048
-------------
RUBBER & PLASTIC - 1.2%
100,000 Premark International, Inc.,
6.875% 11/15/08.................................... 95,584
-------------
STONE, CLAY, GLASS & CONCRETE - 0.9%
75,000 Owens-Illinois, Inc.,
7.350% 5/15/08..................................... 66,511
-------------
MINING & ENERGY - 2.4%
OIL & GAS EXTRACTION - 1.2%
100,000 Occidental Petroleum Corp.,
6.750% 11/15/02.................................... 97,023
-------------
OIL & GAS FIELD SERVICES - 1.2%
100,000 Enron Corp.,
6.725% 11/17/08.................................... 90,950
-------------
RETAIL TRADE - 4.8%
FOOD STORES - 2.3%
100,000 Kroger Co.,
7.000% 5/1/18...................................... 85,017
100,000 Safeway, Inc.,
6.500% 11/15/08.................................... 90,122
-------------
175,139
-------------
</TABLE>
47
<PAGE> 50
CRABBE HUSON CONTRARIAN INCOME FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR CORPORATE FIXED INCOME BONDS (CONTINUED) VALUE
-------------- ---------------------------------------- --------------
<C> <S> <C>
RETAIL TRADE (CONTINUED)
GENERAL MERCHANDISE STORES - 2.5%
$ 50,000 Kmart Corp.,
7.700% 7/2/02...................................... $ 48,905
50,000 Saks, Inc.,
8.250% 11/15/08.................................... 44,174
100,000 Wal-Mart Stores, Inc.,
8.000% 9/15/06..................................... 102,459
-------------
195,538
-------------
SERVICES - 2.5%
AMUSEMENT & RECREATION - 0.6%
50,000 Circus Circus Enterprises, Inc.,
9.250% 12/1/05..................................... 48,250
-------------
AUTO REPAIR SERVICES & PARKING - 0.6%
50,000 Hertz Corp.
6.625% 5/15/08..................................... 45,907
-------------
BUSINESS SERVICES - 1.3%
100,000 Comdisco, Inc.,
6.650% 11/13/01.................................... 98,078
-------------
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES - 12.2%
BROADCASTING - 0.6%
50,000 USA Networks, Inc.,
6.750% 11/15/05.................................... 46,605
-------------
COMMUNICATIONS - 0.6%
50,000 Sprint Corp.,
6.125% 11/15/05.................................... 44,516
-------------
ELECTRIC SERVICES - 2.4%
50,000 Indiana Michigan Power Co.,
6.450% 11/10/08.................................... 44,772
100,000 Kentucky Power Co.,
6.450% 11/10/08.................................... 91,378
55,000 NorAm Energy Corp.,
6.375% 11/1/03..................................... 51,721
-------------
187,871
-------------
MOTOR FREIGHT & WAREHOUSING - 1.4%
115,000 Ryder System Inc.,
6.500% 5/15/05..................................... 106,606
-------------
RAILROAD - 0.6%
50,000 Union Pacific Corp.,
6.790% 11/9/07..................................... 46,401
-------------
</TABLE>
48
<PAGE> 51
CRABBE HUSON CONTRARIAN INCOME FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR CORPORATE FIXED INCOME BONDS (CONTINUED) VALUE
-------------- ---------------------------------------- --------------
<C> <S> <C>
TRANSPORTATION, COMMUNICATION, ELECTRIC,
GAS & SANITARY SERVICES (CONTINUED)
SANITARY SERVICES - 0.6%
$ 50,000 WMX Technologies, Inc.,
6.700% 5/1/01...................................... $ 48,466
-------------
TELECOMMUNICATION - 6.0%
80,000 AT&T Corp.,
7.750% 3/1/07...................................... 80,042
75,000 CBS Corp.,
7.150% 5/20/05..................................... 72,502
50,000 Comcast Cable Communications, Inc.,
6.200% 11/15/08.................................... 43,871
100,000 GTE South, Inc.,
6.000% 2/15/08..................................... 89,218
100,000 SBC Communications, Inc.,
6.250% 3/1/05...................................... 94,504
100,000 US West Communications,
6.625% 9/15/05..................................... 94,748
-------------
474,885
-------------
WHOLESALE TRADE - 1.2%
NONDURABLE GOODS
100,000 Sysco Corp.,
7.000% 5/1/06...................................... 97,038
-------------
Total Corporate Fixed Income Bonds
(cost of $4,213,986) 3,922,503
-------------
<CAPTION>
U.S. GOVERNMENT & AGENCIES OBLIGATIONS - 46.5%
----------------------------------------------
<C> <S> <C>
GOVERNMENT AGENCIES - 20.8%
Federal Home Loan Mortgage Corp.:
203,853 7.000% 2025-2027..................................... 195,825
53,771 7.500% 9/1/25........................................ 52,561
67,931 8.000% 6/1/26........................................ 67,696
54,985 9.000% 4/1/17........................................ 56,118
41,669 9.500% 10/1/16....................................... 43,375
-------------
415,575
-------------
Federal National Mortgage Association,
61,725 9.250% 9/1/16........................................ 63,422
-------------
Government National Mortgage Association:
367,570 6.500% 11/15/28...................................... 344,368
823,386 7.000% 6/15/28....................................... 791,736
-------------
1,136,104
-------------
</TABLE>
49
<PAGE> 52
CRABBE HUSON CONTRARIAN INCOME FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000
PAR VALUE
-------------- ----------------------------------------------------- --------------
U.S. GOVERNMENT & AGENCIES OBLIGATIONS (CONTINUED)
--------------------------------------------------
<C> <S> <C>
GOVERNMENT OBLIGATIONS - 25.7%
U. S. Treasury Bond,
$ 75,000 5.250% 2/15/29....................................... $ 65,883
U. S. Treasury Notes:
125,000 5.500% 8/31/01....................................... 123,164
100,000 5.875% 11/30/01...................................... 98,766
1,405,000 6.125% 8/15/29....................................... 1,408,288
300,000 6.500% 2/15/10....................................... 305,952
-------------
2,002,053
-------------
Total U.S. Government & Agency Obligations (cost of $3,672,696) 3,617,154
-------------
ASSET BACKED SECURITIES - 1.7%
---------------------------------------------------------------------------------------
130,000 Green Tree Financial Corp.,
Series 1997-7, Class A-5,
6.540% 7/15/19....................................... 128,701
-------------
Total Investments
(cost of $7,886,682)................................................. 7,668,358
-------------
SHORT-TERM OBLIGATIONS - 0.2%
---------------------------------------------------------------------------------------
19,000 Repurchase agreement with SBC Warburg Ltd., dated
04/28/00, due 05/01/00 at 5.71%, collateralized by
U.S. Treasury notes with various maturities to
2025, market value of $19,438 (repurchase proceeds
$19,009)........................................... 19,000
-------------
OTHER ASSETS AND LIABILITIES - 1.1% 89,432
-------------
NET ASSETS - 100.0% $7,776,790
-------------
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Cost for federal income tax purposes is the same.
See notes to financial statements.
50
<PAGE> 53
CRABBE HUSON OREGON TAX-FREE FUND
BOND MARKETS DOMINATED BY INFLATION FEARS AND SPECIAL SITUATION IN GOVERNMENT
SECURITIES
Throughout the past six months, fears of higher inflation had a profound effect
on the bond market. Repeated reports of higher costs for goods and rising wages
raised concerns that the U.S. economy, which grew at an annualized rate of 7.3%
in the 1999 fourth quarter, may be growing too rapidly and that inflationary
pressures could bring our nine-year economic expansion to an end. To preempt
this possibility, the Federal Reserve raised key short-term interest rates in
November 1999, as well as February and March 2000. Higher rates are meant to
slow down the economy before inflation can have too great an impact.
Spurred by the persistent talk of inflation, investor sentiment in the bond
market became decidedly bearish. Inflation can erode investors' purchasing
power, so they demand higher yields when inflation is on the rise. During the
final quarter of 1999, yields on long-term U.S. Treasury securities climbed from
6.20% to 6.75%.
A RALLY IN LONG BONDS
Beginning in late January 2000, yields on 30-year Treasurys reversed course. The
change was due to a buyback program instituted by the U.S. Treasury Department
and a shift in investor sentiment. Using the surplus in the federal budget, the
Treasury was buying up long-term government debt. In response to the reduced
supply, investors bid up prices on long-term Treasurys, forcing their yields
down. At the same time, investors realized that the Federal Reserve is serious
about controlling inflation, and they have become less concerned about loss of
purchasing power in the future. This too took pressure off long-term yields. By
the period end, yields on long-term Treasurys had fallen below yields of their
short-term counterparts and prices of long-term Treasurys had risen.
The values of municipal bonds are closely tied to Treasury values, so the
municipal market also declined in late 1999 and rallied in 2000. Municipals were
impacted by a lack of demand from institutional buyers and retail investors.
However, as yields rose during the period, the supply of municipal bonds
nationwide declined. Faced with a higher cost of borrowing, state and local
governments have chosen not to issue as much new debt for the time being. In
Oregon, where the economy is still very strong, the supply of new issues this
year has been ample but not as large as in past years.
FUND PERFORMANCE REFLECTS CHANGING YIELD CURVE
Crabbe Huson Oregon Tax-Free Fund, a portfolio of high-quality Oregon municipal
securities, delivered a total return of 3.10% for the six months ended April 30,
2000, based on Class A shares before sales charges. The Fund's benchmark, the
Lehman Brothers' Municipal Bond Index, had a six-month total return of 2.63%. At
April 30, 2000, the Fund's SEC tax-free yield was 4.27%, which was the
equivalent of earning a taxable yield of 6.52% for an investor in the 28%
federal tax bracket, and paying a 9% Oregon State Tax.
The primary reason the Fund did not perform as well as the index was its longer
duration of 9.3 years at April 30, 2000. Duration reflects the average maturity
of a
51
<PAGE> 54
CRABBE HUSON OREGON TAX-FREE FUND
portfolio's holdings and generally indicates how sensitive the portfolio will be
to interest rate changes. Due to its longer duration, the Fund was more greatly
impacted than the index by rising yields and falling bond prices last fall. Yet
it also benefited more than the index from falling yields and rising prices
since January.
POSITIONED FOR THE LONGER TERM
While many investors are focused on near-term hikes in short-term rates, we are
looking at the longer term. For some time now, we have believed that the Federal
Reserve's attempts to prevent our economy from overheating will ultimately be
successful. In an environment of slower, more sustainable economic growth rates,
inflationary pressures should subside, and the pressure on fixed-income yields
will likely abate. In a falling-rate environment, portfolios with longer
durations (i.e., more intermediate- and long-term securities) would reap more
benefit, so we have maintained the Fund's above-average duration.
We also have maintained our emphasis on high-quality securities. The vast
majority of issues in the portfolio are insured against default by an
independent party or are backed by the full faith and credit of the State of
Oregon. The State's economy is well-diversified and thriving and is projected to
remain that way, which can only help Oregon's municipal issuers meet their
obligations of principal and interest payments.
At this juncture, we think the Fund is well positioned to take advantage of the
continued strength in Oregon's economy and to benefit from a potential rally in
the fixed-income markets later in the year.
<TABLE>
<S> <C>
/s/ Garth R. Nisbet /s/ Paul C. Rocheleau
Garth R. Nisbet, CFA Paul C. Rocheleau
</TABLE>
------------------------
Tax-exempt investing offers current tax-free income, but it also involves
certain risks. The value of the Fund's shares will be affected by interest rate
changes and the creditworthiness of issues held in the Fund. The Fund's
management, including risk management specialists and credit analysts,
identifies problems and opportunities and reacts quickly to market changes.
52
<PAGE> 55
CRABBE HUSON OREGON TAX-FREE FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2000
<TABLE>
<CAPTION>
INCEPTION DATE 10/4/84 1/27/99
SHARE CLASS A B
WITHOUT WITH WITHOUT WITH
SALES SALES SALES SALES
CHARGE CHARGE CHARGE CHARGE
<S> <C> <C> <C> <C>
Cumulative
Six months 3.10% (1.80)% 2.71% (2.29)%
One year (2.70)% (7.32)% (3.43)% (8.05)%
Five years 4.01% 3.00% 3.81% 3.48%
10 years 5.40% 4.88% 5.29% 5.29%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/2000
<TABLE>
<S> <C> <C> <C> <C>
Cumulative
Six months 2.33% (2.53)% 1.95% (3.02)%
One year (1.56)% (6.23)% (2.30)% (6.98)%
Five years 4.17% 3.16% 3.98% 3.65%
10 years 5.42% 4.91% 5.33% 5.33%
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 4.75% sales charge for Class A shares, the appropriate Class B
contingent deferred sales charge for the holding period after purchase as
follows: through first year-5%, second year-4%, third year-3%, fourth year-3%,
fifth year-2%, sixth year-1%, thereafter-0%. Performance for different share
classes will vary based on differences in sales charges and fees associated with
each class.
Performance results reflect any voluntary waivers or reimbursement to Fund
expenses by the Advisor or its affiliates. Absent these waivers or reimbursement
arrangements, performance results would have been lower.
Class B share (newer class shares) performance information includes returns of
the Fund's Class A shares (the oldest existing fund class) for periods prior to
its inception date. These Class A share returns are not restated to reflect any
expense differential (e.g., Rule 12b-1 fees) between Class A and Class B shares.
Had the expense differential been reflected, the returns for the periods prior
to the inception of Class B shares would have been lower.
53
<PAGE> 56
CRABBE HUSON OREGON TAX FREE FUND
INVESTMENT PORTFOLIO
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR MUNICIPAL BONDS - 99.4% VALUE
-------------- ----------------------- --------------
<C> <S> <C>
EDUCATION - 4.7%
$ 500,000 Clackamas Community College District,
Series 1997,
5.400% 6/1/15...................................... $ 495,600
300,000 Multnomah County, University of Portland,
Series 1997,
5.150% 4/1/14...................................... 288,933
-------------
784,533
-------------
HEALTHCARE - 8.8%
HEALTH SERVICES - 2.4%
500,000 Benton County Hospital Facilities Authority,
Samaritan Health Services,
Series 1998,
5.125% 10/1/28..................................... 403,765
-------------
HOSPITALS - 6.4%
1,000,000 Medford Hospital Facilities Authority, Asante Health
Systems,
Series 1998 B,
5.125% 8/15/28..................................... 869,500
198,000 Saint Charles Memorial Hospital, Inc., Saint Charles
Hospital, Series 1973 A,
6.750% 1/1/06...................................... 206,643
-------------
1,076,143
-------------
HOUSING - 17.9%
MULTI-FAMILY - 7.6%
300,000 Portland Housing Authority:
Series 1997 E,
5.150% 7/1/13...................................... 289,191
1,000,000 Series 1998 A,
5.000% 1/1/19...................................... 874,260
110,000 State Department of Housing & Community Services,
Series 1998 A,
5.150% 7/1/15...................................... 104,243
-------------
1,267,694
-------------
SINGLE-FAMILY - 10.3%
265,000 Canby, Series 1997, 5.150% 12/1/14................... 257,108
500,000 Clackamas & Washington Counties School District No.
3,
Series 1997,
5.150% 6/1/14...................................... 483,065
485,000 Oregon City,
Series 1997,
5.200% 10/1/15..................................... 469,097
</TABLE>
54
<PAGE> 57
CRABBE HUSON OREGON TAX FREE FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR MUNICIPAL BONDS (CONTINUED) VALUE
-------------- --------------------------- --------------
<C> <S> <C>
HOUSING (CONTINUED)
SINGLE-FAMILY (CONTINUED)
$ 400,000 State Department of General Services, Real Property
Financing Program,
Series 1992 A,
6.100% 9/1/06...................................... $ 413,444
95,000 Washington County United Sewer Agency,
Series 1992 A,
5.900% 10/1/06..................................... 97,443
-------------
1,720,157
-------------
OTHER - 19.6%
REFUNDED/ESCROW
135,000 Bend County Service District,
Series 1996,
5.375% 6/1/11...................................... 135,863
250,000 Deschutes County,
Series 1998,
4.750% 12/1/12..................................... 232,040
240,000 Lanne County Area Educational District, Lane
Community College,
Series 1995,
4.850% 6/1/08...................................... 232,896
160,000 Marion County School District No.103C,
Series 1995 A,
6.000% 11/1/05..................................... 167,699
100,000 Salem,
Series 1992 A,
5.875% 1/1/07...................................... 101,981
750,000 Salem-Keizer School District No.24J,
Series 1998,
4.875% 6/1/14...................................... 693,315
1,000,000 Tualatin Hills Parks & Recreation District,
Series 1998,
5.750% 3/1/15...................................... 1,032,240
295,000 Umatilla County School District No.6-R,
Series 1998,
4.750% 6/15/10..................................... 283,955
15,000 Washington & Clackamas Counties School District No.
23,
Series 1993,
5.000% 1/1/05...................................... 14,980
</TABLE>
55
<PAGE> 58
CRABBE HUSON OREGON TAX FREE FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR MUNICIPAL BONDS (CONTINUED) VALUE
-------------- --------------------------- --------------
<C> <S> <C>
OTHER (CONTINUED)
REFUNDED/ESCROW (CONTINUED)
$ 400,000 Washington County School District No.48J:
Series 1998,
5.000% 8/1/17...................................... $ 366,996
20,000 No.88J,
Series 1994,
6.100% 6/1/12...................................... 20,678
-------------
3,282,643
-------------
TAX-BACKED - 27.2%
LOCAL GENERAL OBLIGATIONS - 9.7%
500,000 Commonwealth of Puerto Rico Infrastructure Financing
Authority:
Series 1997 A,
5.000% 7/1/13...................................... 483,110
300,000 Series B, 5.000% 7/1/13.............................. 289,866
900,000 Washington, Multnomah & Yamhill Counties School
District,
Series 1998,
5.000% 11/1/14..................................... 858,006
-------------
1,630,982
-------------
SPECIAL PROPERTY TAX - 4.4%
150,000 Metro, Regional Center Project,
Series 1993 A,
5.000% 8/1/10...................................... 146,115
665,000 State Parks Project,
Series 1998 A,
4.750% 4/1/13...................................... 607,172
-------------
753,287
-------------
STATE APPROPRIATED - 13.1%
Northern Oregon Corrections Authority, Gilliam Hood River:
500,000 Series 1997,
5.400% 9/15/16..................................... 492,175
Series 1979 LXI,
175,000 7.200% 7/1/04........................................ 189,576
250,000 7.250% 7/1/06........................................ 278,773
200,000 7.250% 1/1/07........................................ 224,110
Series 1980 LXII,
100,000 9.000% 4/1/03........................................ 110,897
180,000 9.200% 4/1/08........................................ 226,427
Series 1980 LXIII,
205,000 8.200% 7/1/04........................................ 229,536
200,000 8.250% 1/1/07........................................ 235,020
</TABLE>
56
<PAGE> 59
CRABBE HUSON OREGON TAX FREE FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR MUNICIPAL BONDS (CONTINUED) VALUE
-------------- --------------------------- --------------
<C> <S> <C>
TAX-BACKED (CONTINUED)
STATE APPROPRIATED (CONTINUED)
$ 110,000 Series 1992 B,
6.000% 8/1/04...................................... $ 113,652
95,000 Series 1997 76A,
5.550% 4/1/09...................................... 97,893
-------------
2,198,059
-------------
TRANSPORTATION - 5.6%
AIR TRANSPORTATION - 1.9%
355,000 Portland, Portland International Airport,
Series 1998 12-A,
5.000% 7/1/18...................................... 320,739
-------------
TRANSPORTATION - 3.7%
300,000 Commonwealth of Puerto Rico Highway & Transportation
Authority,
Series 1998 A,
5.500% 7/1/12...................................... 307,203
310,000 Series 1998 A,
5.500% 7/1/14...................................... 315,171
-------------
622,374
-------------
UTILITY - 12.3%
MUNICIPAL ELECTRIC - 5.5%
500,000 Puerto Rico Electric Power Authority:
Series 1998 EE,
5.250% 7/1/14...................................... 492,110
500,000 Series 1998 GG,
4.750% 7/1/21...................................... 429,335
-------------
921,445
-------------
WATER & SEWER - 6.8%
500,000 McMinnville,
Series 1994 A,
5.000% 2/1/14...................................... 470,985
500,000 Molalla,
Series 1997,
5.200% 8/1/17...................................... 474,720
Portland:
100,000 Series 1993 A,
5.150% 3/1/08...................................... 99,929
100,000 Series 1995,
5.100% 8/1/08...................................... 99,992
-------------
1,145,626
-------------
</TABLE>
57
<PAGE> 60
CRABBE HUSON OREGON TAX FREE FUND
INVESTMENT PORTFOLIO (CONTINUED)
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, 2000 -----------------------------------------------------
PAR MUNICIPAL BONDS (CONTINUED) VALUE
-------------- --------------------------- --------------
<C> <S> <C>
OTHER - 3.3%
$ 420,000 Deschutes County:
Series 1998 A,
5.050% 6/1/17...................................... $ 363,136
100,000 5.100% 6/1/18........................................ 86,372
100,000 Portland,
Series 1999 A,
5.125% 6/1/14...................................... 96,370
-------------
545,878
-------------
Total Investments (cost of $17,335,719)(a) 16,673,325
-------------
OTHER ASSETS & LIABILITIES, NET - 0.6% 106,637
-------------
NET ASSETS - 100.0% $16,779,962
-------------
-------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
(a) Cost for federal income tax purposes is the same.
See notes to financial statements.
58
<PAGE> 61
CRABBE HUSON FUNDS
STATEMENT OF ASSETS AND LIABILITIES
April 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
CRABBE
HUSON CRABBE
CRABBE CRABBE MANAGED HUSON
HUSON HUSON INCOME & REAL ESTATE
CONTRARIAN EQUITY EQUITY INVESTMENT
FUND FUND FUND FUND
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ASSETS:
Investment at cost $ 3,570,855 $83,588,786 $37,741,472 $ 7,220,253
------------ ------------ ------------ ------------
Investment at market 4,240,104 96,235,382 40,353,480 6,859,322
Short-term obligations 314,000 5,805,000 1,498,000 424,000
Cash 512 635 128 671
Receivables for:
Investments sold -- 1,806,724 523,729 100,617
Fund shares sold -- 1,743 183 273,742
Dividends 2,381 52,293 246,434 4,620
Interest 149 2,762 2,602 202
Expense reimbursement due from Advisor/
Administrator 28,276 71,473 60,947 33,029
Other -- 4,418 3,259 101
------------ ------------ ------------ ------------
4,585,422 103,980,430 42,688,762 7,696,304
------------ ------------ ------------ ------------
LIABILITIES:
Expense reimbursement payable to
Advisor/ Administrator -- -- -- --
Payable for:
Loans -- -- -- --
Investments purchased -- 2,479,334 638,661 --
Fund shares repurchased -- 220,633 81,142 17,955
Distributions -- -- -- --
Accrued:
Management fee 2,969 72,755 32,812 --
Administrator fee 186 4,189 1,751 292
Service fee -- -- -- 1,613
Bookkeeping fee 2,220 3,713 1549 2,219
Transfer Agent fee 440 9,116 2,638 926
Interest expense -- -- -- 126
Deferred Trustees fees 14 139 88 60
Distribution fee - Class B 87 479 -- --
Distribution fee - Class C 3 6 -- 3
Other 27,365 81,879 43,103 17,691
------------ ------------ ------------ ------------
33,284 2,872,243 801,744 40,885
------------ ------------ ------------ ------------
NET ASSETS: $ 4,552,138 $101,108,187 $41,887,018 $ 7,655,419
============ ============ ============ ============
COMPOSITION OF NET ASSETS
Capital paid in $ 3,593,118 $80,358,410 $36,641,719 $ 8,399,940
Undistributed (overdistributed) net
investment income (loss) (1,861) 187,413 148,033 201,325
Accumulated net realized gain (loss) 291,632 7,915,768 2,485,258 (584,915)
Net unrealized appreciation
(depreciation) 669,249 12,646,596 2,612,008 (360,931)
============ ============ ============ ============
$ 4,552,138 $101,108,187 $41,887,018 $ 7,655,419
============ ============ ============ ============
CLASS A
Net Assets $ 4,100,997 $89,742,426 $27,711,644 $ 6,245,861
Shares outstanding 318,977 4,973,228 2,162,410 627,679
============ ============ ============ ============
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE $ 12.85(a) $ 18.72(a) $ 12.82(a) $ 9.95(a)
============ ============ ============ ============
MAXIMUM OFFERING PRICE PER SHARE
(NAV/(1-SALES LOAD)) $ 13.63(b) $ 19.86(b) $ 13.46(b) $ 10.56(b)
============ ============ ============ ============
CLASS B
Net Assets $ 418,585 $ 481,191 $ 29,710 $ 930,852
Shares outstanding 32,913 25,990 2,326 93,543
============ ============ ============ ============
NET ASSET VALUE AND OFFERING PRICE PER
SHARE $ 12.72(a) $ 18.51(a) $ 12.77(a) $ 9.95(a)
============ ============ ============ ============
CLASS C
Net Assets $ 32,556 $ 11,100 $ 3,210 $ 91,529
Shares outstanding 2,561 600 251 9,205
============ ============ ============ ============
NET ASSET VALUE AND OFFERING PER SHARE $ 12.71(a) $ 18.51(a) $ 12.77(a) $ 9.94(a)
============ ============ ============ ============
CLASS I
Net Assets $ -- $10,873,470 $14,142,454 --
Shares outstanding -- 578,080 1,105,634 --
============ ============ ============ ============
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- $ 18.81(a) $ 12.79(a) --
============ ============ ============ ============
CLASS Z
Net Assets -- -- -- $ 387,177
Shares outstanding -- -- -- 38,898
============ ============ ============ ============
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- -- -- $ 9.95(a)
============ ============ ============ ============
</TABLE>
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
See notes to financial statements.
59
<PAGE> 62
CRABBE HUSON FUNDS
STATEMENT OF ASSETS AND LIABILITIES (CONTINUED)
April 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
CRABBE
CRABBE CRABBE CRABBE HUSON
HUSON HUSON HUSON OREGON
SMALL CAP CONTRARIAN SPECIAL TAX-FREE
FUND INCOME FUND FUND, INC. FUND
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ASSETS:
Investment at cost $33,946,593 $ 7,886,682 $50,865,792 $ 17,335,719
------------ ------------ ------------ ------------
Investment at market 29,265,336 7,668,358 45,521,443 16,673,325
Short-term obligations 472,000 19,000 978,000 --
Cash 489 826 602 1,213
Receivables for:
Investments sold 375,897 772 962,010 509
Fund shares sold 1,641 1,405 2,585 267,453
Dividends 4,729 -- 465 --
Interest 225 131,307 -- --
Expense reimbursement due from Advisor/
Administrator 61,162 -- 149,060 --
Other 48,469 -- -- --
------------ ------------ ------------ ------------
30,229,948 7,821,668 47,614,165 16,942,500
------------ ------------ ------------ ------------
LIABILITIES:
Expense reimbursement payable to
Advisor/ Administrator -- 26,778 -- 9,113
Payable for:
Loans -- -- 3,000,000 --
Investments purchased 18,940 -- -- --
Fund shares repurchased 5,683 -- 63,120 110,067
Distributions -- -- -- 16,193
Accrued:
Management fee 24,838 4,828 37,110 7,030
Administrator fee 1,242 323 1,856 703
Service fee -- 52 11,121 --
Bookkeeping fee 2,213 2,219 2,213 2,219
Transfer Agent fee 1,022 1,954 7,007 1,857
Interest expense -- -- 10,092 --
Deferred Trustees fees 77 14 87 137
Distribution fee - Class B -- 57 -- 95
Distribution fee - Class C -- 2 -- --
Other 35,339 8,651 62,224 15,124
------------ ------------ ------------ ------------
89,354 44,878 3,194,830 162,538
------------ ------------ ------------ ------------
NET ASSETS: $30,140,594 $ 7,776,790 $44,419,335 $ 16,779,962
============ ============ ============ ============
COMPOSITION OF NET ASSETS
Capital paid in $63,295,584 $ 7,986,826 $108,249,212 $ 17,335,305
Undistributed (overdistributed) net
investment income (loss) (100,076) 22,789 (179,498) 205,459
Accumulated net realized gain (loss) (28,373,657) (14,501) (58,306,030) (98,406)
Net unrealized appreciation
(depreciation) (4,681,257) (218,324) (5,344,349) (662,396)
============ ============ ============ ============
$30,140,594 $ 7,776,790 $44,419,335 $ 16,779,962
============ ============ ============ ============
CLASS A
Net Assets $ 6,374,355 $ 3,583,008 $44,419,335 $ 16,729,300
Shares outstanding 581,021 359,235 4,772,740 1,438,268
============ ============ ============ ============
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE $ 10.97(a) $ 9.97(a) $ 9.31(a) $ 11.06(a)
============ ============ ============ ============
MAXIMUM OFFERING PRICE PER SHARE
(NAV/(1-SALES LOAD)) $ 11.64(b) $ 10.47(b) $ 9.88(b) $ 12.21(b)
============ ============ ============ ============
CLASS B
Net Assets -- $ 84,640 $ -- $ 53,662
Shares outstanding -- 8,422 -- 4,615
============ ============ ============ ============
NET ASSET VALUE AND OFFERING PRICE PER
SHARE -- $ 10.05(a) $ -- $ 11.63(a)
============ ============ ============ ============
CLASS C
Net Assets -- $ 1,017 $ -- $ --
Shares outstanding -- 102 -- --
============ ============ ============ ============
NET ASSET VALUE AND OFFERING PER SHARE -- $ 10.02(a) $ -- $ --
============ ============ ============ ============
CLASS I
Net Assets $23,776,239 $ 102,072 $ -- $ --
Shares outstanding 2,146,405 10,304 -- --
============ ============ ============ ============
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE $ 11.07(a) $ 9.91(a) $ -- $ --
============ ============ ============ ============
CLASS Z
Net Assets -- $ 4,006,053 $ -- $ --
Shares outstanding -- 403,685 -- --
============ ============ ============ ============
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE $ -- $ 9.92(a) $ -- $ --
============ ============ ============ ============
</TABLE>
(a) Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
See notes to financial statements.
60
<PAGE> 63
CRABBE HUSON FUNDS
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
CRABBE CRABBE CRABBE HUSON CRABBE HUSON
HUSON HUSON MANAGED REAL ESTATE
CONTRARIAN EQUITY INCOME & EQUITY INVESTMENT
FUND FUND FUND FUND
---------- ----------- --------------- ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest $ 8,067 $ 135,660 $ 763,036 $ 7,277
Dividends 24,878 797,292 210,546 281,494
-------- ----------- ---------- ---------
32,945 932,952 973,582 288,771
EXPENSES
Management fee 16,167 560,546 248,342 40,333
Administration fee 1,010 -- 12,525 2,028
Service fee - Class A 4,667 119,256 40,270 8,278
Service fee - Class B 423 590 35 1,046
Service fee - Class C 23 10 4 91
Distribution fee - Class B 1,236 1,773 106 3,135
Distribution fee - Class C 69 30 11 272
Transfer agent fee - Class A 4,697 152,968 47,261 13,744
Transfer agent fee - Class I -- 153 216 --
Bookkeeping fee 13,760 23,796 13,500 13,535
Trustees fee 3,276 6,916 4,186 3,822
Custodian fee 3,640 5,096 2,366 3,640
Interest -- -- 2,702 --
Audit fee 4,914 24,934 6,734 5,824
Legal fee 2,912 1,820 2,548 2,002
Registration fee 34,580 14,924 19,838 6,552
Reports to shareholders 1,092 9,282 3,822 910
Amortization of deferred
organization expenses -- -- 3,065 --
Other 1,274 22,421 3,276 2,874
-------- ----------- ---------- ---------
93,740 944,515 410,807 108,086
Fees and expenses waived or
borne by the Advisor/
Administrator (59,974) (201,655) -- (45,089)
Class A -- -- (63,812) --
Class I -- -- (29,196) --
-------- ----------- ---------- ---------
NET EXPENSES 33,766 742,860 317,799 62,997
-------- ----------- ---------- ---------
NET INVESTMENT INCOME (LOSS) (821) 190,092 655,783 225,774
-------- ----------- ---------- ---------
NET REALIZED & UNREALIZED GAIN
(LOSS) ON PORTFOLIO POSITIONS
Net realized gain (loss) on
investments 298,134 11,657,673 3,454,811 (344,922)
Net change in unrealized
appreciation/depreciation
on investments 555,641 3,197,968 40,838 748,780
-------- ----------- ---------- ---------
NET GAIN (LOSS) ON INVESTMENTS 853,775 14,855,641 3,495,649 403,858
-------- ----------- ---------- ---------
NET INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $852,954 $15,045,733 $4,151,432 $ 629,632
======== =========== ========== =========
</TABLE>
See notes to financial statements.
61
<PAGE> 64
CRABBE HUSON FUNDS
STATEMENT OF OPERATIONS (CONTINUED)
For the Six Months Ended April 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
CRABBE THE CRABBE CRABBE HUSON CRABBE HUSON
HUSON HUSON CONTRARIAN OREGON
SMALL CAP SPECIAL INCOME TAX-FREE
FUND FUND, INC. FUND FUND
---------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest $ 14,089 $ 25,281 $ 267,501 $ 510,234
Dividends 69,070 160,312 -- --
----------- ----------- --------- -----------
83,159 185,593 267,501 510,234
EXPENSES
Management fee 173,146 243,023 29,443 46,795
Administration fee 8,653 12,151 1,963 4,679
Service fee - Class A 8,653 60,777 4,333 23,181
Service fee - Class B -- -- 83 --
Service fee - Class C -- -- 1 --
Distribution fee - Class B -- -- 250 198
Distribution fee - Class C -- -- 4 --
Transfer agent fee - Class A 16,115 117,625 8,408 16,746
Transfer agent fee - Class I 277 -- 1 --
Bookkeeping fee 13,593 13,630 13,642 13,642
Trustees fee 4,732 5,278 3,640 3,640
Custodian fee 4,550 2,548 2,002 1,820
Interest 6,628 347,369 -- --
Audit fee 7,098 7,098 4,914 2,912
Legal fee 2,912 4,186 1,456 2,912
Registration fee 14,378 12,012 3,640 546
Reports to shareholders 3,276 3,640 546 1,274
Amortization of deferred
organization expenses 12,865 -- -- --
Other 5,481 3,437 3,559 2,728
----------- ----------- --------- -----------
273,704 832,774 77,885 121,073
Fees and expenses waived or
borne by the Advisor/
Administrator (92,171) (469,571) (51,708) (29,967)
Class A -- -- -- --
Class I -- -- -- --
----------- ----------- --------- -----------
NET EXPENSES 181,533 363,203 26,177 91,106
----------- ----------- --------- -----------
NET INVESTMENT INCOME (LOSS) (98,374) (177,610) 241,324 419,128
----------- ----------- --------- -----------
NET REALIZED & UNREALIZED GAIN
(LOSS) ON PORTFOLIO POSITIONS
Net realized gain (loss) on
investments (5,334,051) (9,451,305) (14,332) (96,364)
Net change in unrealized
appreciation/depreciation
on investments 15,288,628 24,003,396 (105,136) 181,213
----------- ----------- --------- -----------
NET GAIN (LOSS) ON INVESTMENTS 9,954,577 14,552,091 (119,468) 84,849
----------- ----------- --------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 9,856,203 $14,374,481 $ 121,856 $ 503,977
=========== =========== ========= ===========
</TABLE>
See notes to financial statements.
62
<PAGE> 65
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
CRABBE HUSON
CONTRARIAN FUND
-------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)(B)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment loss $ (821) $ (5,261)
Net realized gain (loss) 298,134 (6,502)
Net change in unrealized appreciation/depreciation 555,641 113,608
------------- -------------
Net Increase in Operations 852,954 101,845
FUND SHARE TRANSACTIONS:
Receipts for shares sold-Class A 72,050 3,235,295
Value of distributions reinvested-Class A -- --
Cost of shares repurchased-Class A (31,399) (82,256)
------------- -------------
40,651 3,153,039
------------- -------------
Receipts for shares sold-Class B 208,476 232,547
Value of distributions reinvested-Class B -- --
Cost of shares repurchased-Class B (65,941) (264)
------------- -------------
142,535 232,283
------------- -------------
Receipts for shares sold-Class C 19,302 9,529
------------- -------------
Net Increase from Fund Share Transactions 202,488 3,394,851
------------- -------------
Total Increase 1,055,442 3,496,426
NET ASSETS
Beginning of period 3,496,696 --
------------- -------------
End of period(net of overdistributed net investment
income of $1,861 and $1,040 respectively) $4,552,138 $3,496,696
============= =============
NUMBER OF FUND SHARES:
Sold-Class A 6,073 322,801
Repurchased-Class A (2,671) (7,226)
------------- -------------
3,402 315,575
------------- -------------
Sold-Class B 18,065 20,234
Repurchased-Class B (5,363) (23)
------------- -------------
12,702 20,211
------------- -------------
Sold-Class C 1,644 917
============= =============
</TABLE>
(a) Class B and Class C shares were initially offered January 27, 1999.
(b) The Fund commenced investment operations on December 1, 1998.
See notes to financial statements.
63
<PAGE> 66
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
EQUITY FUND
-------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 190,092 $ 413,265
Net realized gain 11,657,673 16,616,334
Net change in unrealized appreciation/depreciation 3,197,968 (3,203,399)
------------- -------------
Net Increase in Operations 15,045,733 13,826,200
DISTRIBUTIONS:
From net investment income-Class A -- (1,254,599)
From net realized gains-Class A (3,026,972) (7,391,449)
From net realized gains-Class B (14,212) --
From net realized gains-Class C (213) --
From net investment income-Class I -- (288,497)
From net realized gains-Class I (384,942) (919,801)
------------- -------------
11,619,394 3,971,854
------------- -------------
FUND SHARE TRANSACTIONS:
Receipts for shares sold-Class A 5,615,284 75,426,893
Value of distributions reinvested-Class A 2,846,962 8,116,009
Cost of shares repurchased-Class A (31,430,203) (211,486,686)
------------- -------------
(22,967,957) (127,943,784)
------------- -------------
Receipts for shares sold-Class B 100,220 520,696
Value of distributions reinvested-Class B 13,540 --
Cost of shares repurchased-Class B (145,125) (71)
------------- -------------
(31,365) 520,625
------------- -------------
Receipts for shares sold-Class C 3,584 6,940
Value of distributions reinvested-Class C 213 --
Cost of shares repurchased-Class C (75) --
------------- -------------
3,722 6,940
------------- -------------
Receipts for shares sold-Class I 230,996 2,581,967
Value of distributions reinvested-Class I 378,109 1,074,278
Cost of shares repurchased-Class I (5,215,048) (17,421,639)
------------- -------------
(4,605,943) (13,765,394)
------------- -------------
Net Decrease from Fund Share Transactions (27,601,543) (141,181,613)
------------- -------------
Total Decrease (15,982,149) (137,209,759)
NET ASSETS
Beginning of period 117,090,336 254,300,095
------------- -------------
End of period (including undistributed and net of
overdistributed net investment income of $187,413
and $2,679, respectively) $101,108,187 $ 117,090,336
============= =============
</TABLE>
(a) Class B and Class C shares were initially offered on January 27, 1999.
See notes to financial statements.
64
<PAGE> 67
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
EQUITY FUND
-------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)
<S> <C> <C>
NUMBER OF FUND SHARES
Sold-Class A 316,391 4,419,062
Issued for distributions reinvested-Class A 167,272 496,999
Repurchased-Class A (1,793,098) (12,462,492)
------------- -------------
(1,309,435) (7,546,431)
------------- -------------
Sold-Class B 5,820 28,000
Issued for distributions reinvested-Class B 802 --
Repurchased-Class B (8,629) (4)
------------- -------------
(2,007) 27,996
------------- -------------
Sold-Class C 209 383
Issued for distributions reinvested-Class C 12 --
Repurchased-Class C (4) --
------------- -------------
217 383
------------- -------------
Sold-Class I 12,955 152,513
Issued for distributions reinvested-Class I 22,151 65,866
Repurchased-Class I (300,454) (1,036,701)
------------- -------------
(265,348) (818,322)
------------- -------------
</TABLE>
(a) Class B and Class C shares were initially offered on January 27, 1999.
See notes to financial statements.
65
<PAGE> 68
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON MANAGED
INCOME & EQUITY FUND
-------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 655,783 $ 1,739,694
Net realized gain 3,454,811 5,979,039
Net change in unrealized appreciation/depreciation 40,838 (3,117,510)
-------------- -------------
Net Increase in Operations 4,151,432 4,601,203
DISTRIBUTIONS:
From net investment income-Class A (527,051) (1,024,235)
From net realized gains-Class A (2,418,087) (1,378,198)
From net investment income-Class B (344) (186)
From net realized gains-Class B (1,994) --
From net investment income-Class C (35) (24)
From net realized gains-Class C (191) --
From net investment income-Class I (309,736) (731,632)
From net realized gains-Class I (1,309,207) (723,750)
------------- -------------
(415,213) 743,178
------------- -------------
FUND SHARE TRANSACTIONS:
Receipts for shares sold-Class A 1,702,916 2,052,293
Value of distributions reinvested-Class A 2,684,360 2,231,687
Cost of shares repurchased-Class A (14,210,954) (34,679,599)
------------- -------------
(9,823,678) (30,395,619)
------------- -------------
Receipts for shares sold-Class B 2,431 31,130
Value of distributions reinvested-Class B 2,339 187
Cost of shares repurchased-Class B (4,516) (395)
------------- -------------
254 30,922
------------- -------------
Receipts for shares sold-Class C 169 2,995
Value of distributions reinvested-Class C 225 24
Cost of shares repurchased-Class C (15) --
------------- -------------
379 3,019
------------- -------------
Receipts for shares sold-Class I 537,108 1,839,007
Value of distributions reinvested-Class I 1,597,425 1,456,135
Cost of shares repurchased-Class I (9,020,178) (16,069,684)
------------- -------------
(6,885,645) (12,774,542)
------------- -------------
Net Decrease from Fund Share Transactions (16,708,690) (43,136,220)
------------- -------------
Total Decrease (17,123,903) (42,393,042)
NET ASSETS
Beginning of period 59,010,921 101,403,963
------------- -------------
End of period (net of undistributed net investment
income of $148,033 and $329,416, respectively) $ 41,887,018 $ 59,010,921
============= =============
</TABLE>
(a) Class B and Class C shares were initially offered on January 27, 1999.
See notes to financial statements.
66
<PAGE> 69
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON MANAGED
INCOME & EQUITY FUND
-------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)
<S> <C> <C>
NUMBER OF FUND SHARES
Sold-Class A 132,102 155,941
Issued for distributions reinvested-Class A 221,396 175,603
Repurchased-Class A (1,146,263) (2,660,810)
------------- -------------
(792,765) (2,329,266)
------------- -------------
Sold-Class B 202 2,313
Issued for distributions reinvested-Class B 193 14
Repurchased-Class B (368) (28)
------------- -------------
27 2,299
------------- -------------
Sold-Class C 13 219
Issued for distributions reinvested-Class C 18 2
Repurchased-Class C (1) --
------------- -------------
30 221
------------- -------------
Sold-Class I 43,622 142,254
Issued for distributions reinvested-Class I 131,982 114,631
Repurchased-Class I (729,261) (1,229,687)
------------- -------------
(553,657) (972,802)
------------- -------------
</TABLE>
(a) Class B and Class C shares were initially offered on January 27, 1999.
See notes to financial statements.
67
<PAGE> 70
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
REAL ESTATE INVESTMENT
FUND
--------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)(B)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 225,774 $ 763,578
Net realized loss (344,922) (233,867)
Net change in unrealized
appreciation/depreciation 748,780 (741,407)
------------- -------------
Net Increase in Operations 629,632 (211,696)
DISTRIBUTIONS:
From net investment income-Class A (326,823) (451,269)
From net realized gains-Class A -- (282,505)
From net investment income-Class B (35,771) (10,018)
From net investment income-Class C (3,148) (482)
From net investment income-Class Z (23,305) (9,270)
------------- -------------
240,585 (965,240)
------------- -------------
FUND SHARE TRANSACTIONS:
Receipts for shares sold-Class A 964,157 2,445,437
Value of distributions reinvested-Class A 308,895 706,348
Cost of shares repurchased-Class A (3,391,850) (11,534,879)
------------- -------------
(2,118,798) (8,383,094)
------------- -------------
Receipts for shares sold-Class B 197,128 1,024,618
Value of distributions reinvested-Class B 27,452 7,814
Cost of shares repurchased-Class B (102,662) (212,999)
------------- -------------
121,918 819,433
------------- -------------
Receipts for shares sold-Class C 23,194 73,494
Value of distributions reinvested-Class C 2,775 339
Cost of shares repurchased-Class C (2,359) (4,314)
------------- -------------
23,610 69,519
------------- -------------
Receipts for shares sold-Class Z 15,274 534,812
Value of distributions reinvested-Class Z 23,305 9,270
Cost of shares repurchased-Class Z (156,834) (1,834)
------------- -------------
(118,255) 542,248
------------- -------------
Net Decrease from Fund Share Transactions (2,091,525) (6,951,894)
------------- -------------
Total Decrease (1,850,940) (7,917,134)
NET ASSETS
Beginning of period 9,506,359 17,423,493
------------- -------------
End of period (net of undistributed net investment
income of $201,325 and $364,598, respectively) $ 7,655,419 $ 9,506,359
============= =============
</TABLE>
(a) Class B and Class C shares were initially offered on January 27, 1999.
(b) Class Z shares were initially offered on January 29, 1999.
See notes to financial statements.
68
<PAGE> 71
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
REAL ESTATE INVESTMENT FUND
-------------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)(B)
<S> <C> <C>
NUMBER OF FUND SHARES
Sold-Class A 100,272 236,140
Value of distributions reinvested-Class A 34,673 68,570
Repurchased-Class A (366,355) (1,117,360)
------------- -------------
(231,410) (812,650)
------------- -------------
Sold-Class B 21,403 100,362
Value of distributions reinvested-Class A 3,080 757
Repurchased-Class B (10,964) (21,095)
------------- -------------
13,519 80,024
------------- -------------
Sold-Class C 2,452 7,119
Value of distributions reinvested-Class C 311 33
Repurchased-Class C (251) (459)
------------- -------------
2,512 6,693
------------- -------------
Sold-Class Z 1,571 50,892
Value of distributions reinvested-Class Z 2,617 898
Repurchased-Class Z (16,897) (183)
------------- -------------
(12,709) 51,607
------------- -------------
</TABLE>
(a) Class B and Class C shares were initially offered on January 27, 1999.
(b) Class Z shares were initially offered on January 29, 1999.
See notes to financial statements.
69
<PAGE> 72
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
SMALL CAP FUND
-------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment loss $ (98,374) $ (275,150)
Net realized loss (5,334,051) (22,918,425)
Net change in unrealized appreciation/depreciation 15,288,628 23,557,586
------------- -------------
Net Increase in Operations 9,856,203 364,011
DISTRIBUTIONS:
From net realized gains-Class A -- (59,988)
In excess of net realized gains-Class A -- (18,856)
From net investment income-Class I -- (254,415)
From net realized gains-Class I -- (79,968)
------------- -------------
9,856,203 (49,216)
------------- -------------
FUND SHARE TRANSACTIONS:
Receipts for shares sold-Class A 7,652,800 4,729,406
Value of distributions reinvested-Class A -- 72,137
Cost of shares repurchased-Class A (10,302,133) (12,006,322)
------------- -------------
(2,649,333) (7,204,779)
------------- -------------
Receipts for shares sold-Class I 2,511,195 14,429,080
Value of distributions reinvested-Class I -- 309,467
Cost of shares repurchased-Class I (10,952,998) (53,110,089)
------------- -------------
(8,441,803) (38,371,542)
------------- -------------
Net Decrease from Fund Share Transactions (11,091,136) (45,576,321)
------------- -------------
Total Decrease (1,234,933) (45,625,537)
NET ASSETS
Beginning of period 31,375,527 77,001,064
------------- -------------
End of period (net of overdistributed net
investment income of $100,076 and $1,702,
respectively) $ 30,140,594 $ 31,375,527
============= =============
NUMBER OF FUND SHARES
Sold-Class A 782,479 518,133
Issued for distributions reinvested-Class I -- 8,006
Repurchased-Class A (1,049,528) (1,350,075)
------------- -------------
(267,049) (823,936)
------------- -------------
Sold-Class I 246,961 1,631,965
Issued for distributions reinvested-Class I -- 34,233
Repurchased-Class I (1,087,573) (5,886,724)
------------- -------------
(840,612) (4,220,526)
------------- -------------
</TABLE>
See notes to financial statements.
70
<PAGE> 73
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
THE CRABBE HUSON
SPECIAL FUND, INC.
-------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment loss $ (177,610) $ (650,567)
Net realized loss (9,451,305) (27,640,698)
Net change in unrealized appreciation/depreciation 24,003,396 21,898,716
------------- -------------
Net Increase (Decrease) in Operations 14,374,481 (6,392,549)
FUND SHARE TRANSACTIONS:
Receipts for shares sold 1,600,725 28,680,609
Cost of shares repurchased (19,027,727) (79,319,894)
------------- -------------
Net Decrease from Fund Share Transactions (17,427,002) (50,639,285)
------------- -------------
Total Decrease (3,052,521) (57,031,834)
NET ASSETS
Beginning of period 47,471,856 104,503,690
------------- -------------
End of period (net of overdistributed net
investment income of $179,498 and $1,888,
respectively) $ 44,419,335 $ 47,471,856
============= =============
NUMBER OF FUND SHARES
Sold 203,505 3,351,118
Repurchased (2,242,823) (9,447,772)
------------- -------------
(2,039,318) (6,096,654)
------------- -------------
</TABLE>
See notes to financial statements.
71
<PAGE> 74
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
CONTRARIAN INCOME FUND
--------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 241,324 $ 328,456
Net realized gain (loss) (14,332) 92,322
Net change in unrealized
appreciation/depreciation (105,136) (362,140)
------------ -------------
Net Increase in Operations 121,856 58,638
DISTRIBUTIONS:
From net investment income-Class A (86,987) (280,146)
From net realized gains-Class A (18,455) (160,374)
From net investment income-Class B (1,159) (50)
From net realized gains-Class B (321) --
From net investment income-Class C (18) (7)
From net realized gains-Class C (5) --
From net investment income-Class I (3,020) (6,305)
From net realized gains-Class I (541) (2,044)
From net investment income-Class Z (117,920) (43,797)
From net realized gains-Class Z (23,549) --
------------- -------------
(130,119) (434,085)
------------- -------------
FUND SHARE TRANSACTIONS:
Receipts for shares sold-Class A 984,719 977,689
Value of distributions reinvested-Class A 55,970 324,283
Cost of shares repurchased-Class A (1,254,827) (5,862,851)
------------- -------------
(214,138) (4,560,879)
------------- -------------
Receipts for shares sold-Class B 68,312 16,204
Value of distributions reinvested-Class B 1,424 38
Cost of shares repurchased-Class B (1,086) --
------------- -------------
68,650 16,242
------------- -------------
Receipts for shares sold-Class C -- 1,000
Value of distributions reinvested-Class C 23 7
Cost of shares repurchased-Class C -- --
------------- -------------
23 1,007
------------- -------------
Receipts for shares sold-Class I -- --
Value of distributions reinvested-Class I 3,561 8,481
Cost of shares repurchased-Class I -- --
------------- -------------
3,561 8,481
------------- -------------
Receipts for shares sold-Class Z 210,998 4,231,282
Value of distributions reinvested-Class Z 141,469 46,492
Cost of shares repurchased-Class Z (510,855) --
------------- -------------
(158,388) 4,277,774
------------- -------------
Net Decrease from Fund Share Transactions (300,292) (257,375)
------------- -------------
Total Decrease (430,411) (691,460)
NET ASSETS
Beginning of period 8,207,201 8,898,661
------------- -------------
End of period (including undistributed and net of
overdistributed net investment income of $22,789
and $9,431, respectively) $ 7,776,790 $ 8,207,201
============= =============
</TABLE>
(a) Class B, Class C, and Class Z shares were initially offered on September 15,
1999.
See notes to financial statements.
72
<PAGE> 75
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
CONTRARIAN INCOME FUND
--------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999
<S> <C> <C>
NUMBER OF FUND SHARES
Sold-Class A 98,172 93,007
Issued for distributions reinvested-Class A 5,594 30,812
Repurchased-Class A (124,697) (552,474)
------------- -------------
(20,931) (428,655)
------------- -------------
Sold-Class B 6,789 1,596
Issued for distributions reinvested-Class B 141 4
Repurchased-Class B (109) --
------------- -------------
6,821 1,600
------------- -------------
Sold-Class C -- 99
Issued for distributions reinvested-Class C 2 1
------------- -------------
2 100
------------- -------------
Issued for distributions reinvested-Class I 358 812
------------- -------------
358 812
------------- -------------
Sold-Class Z 20,862 415,297
Issued for distributions reinvested-Class Z 14,173 4,615
Repurchased-Class Z (51,261) --
------------- -------------
(16,226) 419,912
------------- -------------
</TABLE>
(a) Class B, Class C, and Class Z shares were initially offered on September 15,
1999.
See notes to financial statements.
73
<PAGE> 76
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
OREGON TAX-FREE FUND
--------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 419,128 $ 975,806
Net realized gain (loss) (96,364) 176,439
Net change in unrealized
appreciation/depreciation 181,213 (2,201,977)
------------ -------------
Net Increase (Decrease) from Operations 503,977 (1,049,732)
DISTRIBUTIONS:
From net investment income-Class A (396,254) (977,765)
From net realized gains-Class A (147,399) (620,463)
From net investment income-Class B (932) (764)
From net realized gains-Class B (381) --
------------- -------------
(40,989) (2,648,724)
------------- -------------
FUND SHARE TRANSACTIONS:
Receipts for shares sold-Class A 163,716 565,418
Value of distributions reinvested-Class A 433,421 1,239,295
Cost of shares repurchased-Class A (4,398,080) (4,182,093)
------------- -------------
(3,800,943) (2,377,380)
------------- -------------
Receipts for shares sold-Class B -- 54,532
Value of distributions reinvested-Class B 1,365 712
Cost of shares repurchased-Class B -- --
------------- -------------
1,365 55,245
------------- -------------
Net Increase from Fund Share Transactions (3,799,578) (2,322,136)
------------- -------------
Total Increase (Decrease) (3,840,567) (4,970,859)
NET ASSETS
Beginning of period 20,620,529 25,591,389
------------- -------------
End of period (net including undistributed net
investment income of $205,459 and $182,022,
respectively) $16,779,962 $20,620,529
============= =============
</TABLE>
(a) Class B shares were initially offered on January 27, 1999.
See notes to financial statements.
74
<PAGE> 77
CRABBE HUSON FUNDS
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
CRABBE HUSON
OREGON TAX-FREE FUND
--------------------------------
(UNAUDITED)
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, OCTOBER 31,
-------------- --------------
2000 1999(A)
<S> <C> <C>
NUMBER OF FUND SHARES
Sold-Class A 14,034 45,385
Issued for distributions reinvested-Class A 37,447 99,282
Repurchased-Class A (882,737) (389,845)
------------- -------------
(331,256) (194,678)
------------- -------------
Sold-Class B -- 4,438
Issued for distributions reinvested-Class B 118 60
Repurchased-Class B -- --
------------- -------------
118 4,498
------------- -------------
</TABLE>
(a) Class B shares were initially offered on January 27, 1999.
See notes to financial statements.
75
<PAGE> 78
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS
April 30, 2000 (Unaudited)
NOTE 1. INTERIM FINANCIAL STATEMENTS
In the opinion of management of the Crabbe Huson Contrarian Fund ("Contrarian
Fund"), Crabbe Huson Equity Fund ("Equity Fund"), Crabbe Huson Managed Income
and Equity Fund ("Managed Fund"), Crabbe Huson Real Estate Investment Fund
("Real Estate Fund"), Crabbe Huson Small Cap Fund ("Small Cap Fund"), Crabbe
Huson Special Fund ("Special Fund"), Crabbe Huson Contrarian Income Fund
("Income Fund") and Crabbe Huson Oregon Tax-Free Fund ("Oregon Tax-Free Fund"),
each a series of Liberty Funds Trust III, the accompanying financial statements
contain all normal and recurring adjustments necessary for the fair presentation
of the financial position of the Funds at April 30, 2000, and the results of
their operations, the changes in their net assets and the financial highlights
for the six months then ended.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION: All of the Funds are registered under the Investment Company Act
of 1940. All of the Funds (other than the Oregon Tax-Free Fund) are open-end
diversified portfolio investment companies. The Oregon Tax-Free Fund is an open-
end, non-diversified investment company. Each Fund may issue an unlimited number
of shares. All of the Funds offer Class A shares. Class A shares are sold with a
front-end sales charge. A 1.00% contingent deferred sales charge is assessed on
redemptions made within eighteen months on an original purchase of $1 million to
$5 million. Effective January 27, 1999, Equity, Managed, Real Estate and Oregon
Tax-Free Funds began offering Class B shares. The Contrarian Fund has continued
to offer Class B shares since inception on December 1, 1998. Class B shares are
subject to an annual distribution fee and a contingent deferred sales charge.
Class B shares will convert to Class A shares when they have been outstanding
approximately eight years. Effective January 27, 1999, Equity, Managed and Real
Estate Funds began offering Class C shares. The Contrarian Fund has continued to
offer Class C shares since inception on December 1, 1998. Class C shares are
subject to a contingent deferred sales charge on redemptions made within one
year after purchase and an annual distribution fee. The Equity, Managed,
Small-Cap and Income Funds offer Class I shares. Effective January 29, 1999,
Real Estate Fund began offering Class Z shares. Class Z shares are offered
continuously at net asset value. In addition, there are certain restrictions on
the purchase of Class I and Class Z shares, please refer to the prospectus. The
Class A and Class I shares differ principally in the service fees and
shareholder servicing fees.
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
76
<PAGE> 79
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2000 (Unaudited)
revenues and expenses during the period. Actual results could differ from those
estimates. The following is a summary of significant accounting policies that
are consistently followed by the Funds in the preparation of their financial
statements.
SECURITY VALUATION AND TRANSACTIONS: Equity securities generally are valued at
the last sale price or, in the case of unlisted or listed securities for which
there were no sales during the day, at current quoted bid prices.
Debt securities generally are valued by a pricing service based upon market
transactions for normal, institutional-size trading units of similar securities.
When management deems it appropriate, an over-the-counter or exchange bid
quotation is used.
Options are valued at the last reported sale price, or in the absence of a sale,
the mean between the last quoted bid and asking price.
Short-term obligations with a maturity of 60 days or less are valued at
amortized cost.
Portfolio positions for which market quotations are not readily available are
valued at fair value under procedures approved by the Trustees.
Security transactions are accounted for on the date the securities are
purchased, sold or mature.
Cost is determined and gains and losses are based upon specific identification
method for both financial statement and federal income tax purposes.
The Funds may trade securities on other than normal settlement terms. This may
increase the risk if the other party to the transaction fails to deliver and
causes the Funds to subsequently invest at less advantageous prices.
The Special Fund may engage in short sales. A short sale is effected when it is
believed that the price of a particular security will decline, and involves the
sale of a security which the Fund does not own in the hope of purchasing the
same security at a later date at a lower price. To make delivery to the buyer,
the Fund must borrow the security. The Fund is then obligated to return the
security to the lender, and therefore it must subsequently purchase the same
security.
Proceeds from the sale of a borrowed security remain on deposit with the broker
loaning that security. Additional deposits may be required in the event that the
value of the securities sold short exceeds a percentage of the amount on deposit
with the broker. In addition, the borrowing fund is required to segregate cash,
U.S. government securities or other liquid securities in an amount equal to the
market value of all borrowed securities less any amounts on deposit with
brokers. As a result of these activities, the borrowing fund will not be deemed
to create leverage merely by entering into a short selling transaction, except
to the extent that income is earned
77
<PAGE> 80
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2000 (Unaudited)
on amounts on deposit with the broker. The amount on deposit with the broker
plus the value of the segregated securities may not exceed 25% of net assets.
LOANS OF PORTFOLIO SECURITIES: Each of the Funds may lend portfolio securities,
up to 20% (10% for Oregon Tax-Free Fund) of the value of a Fund's total assets.
The Funds receive total collateral in an amount at least equal to 100% of the
market value of the securities loaned at the inception of the loan. The value of
the portfolio securities loaned is marked to market on a daily basis and
additional collateral is received from the borrower, as necessary, to ensure
that its value is at least equal to 100% of the securities loaned at all times.
Interest income earned on the investment of the collateral plus reimbursement
for management fees associated with such investment, in excess of rebates to the
borrower, is recorded on an accrual basis. Income earned on non-cash collateral
is based on a percentage of the market value of the securities loaned and is
recorded on an accrual basis. If the borrower defaults and the value of the
portfolio securities increases in excess of the collateral received or if
bankruptcy proceedings commence with respect to the borrower of the security,
realization of the value of the securities loaned may be delayed or limited.
DETERMINATION OF CLASS NET ASSET VALUES AND FINANCIAL HIGHLIGHTS: All income,
expenses (other than the Class A, Class B and Class C service fees, Class B and
Class C distribution fees and Class I transfer agent fee) and realized and
unrealized gains (losses) are allocated to each class proportionately on a daily
basis for purposes of determining the net asset value of each class.
The per share data (other than the Oregon Tax-Free Fund) was calculated using
average shares outstanding during the period. In addition, Class A, Class B and
Class C net investment income per share data reflect the service fee per share
applicable to Class A, Class B and Class C shares and the distribution fee
applicable to Class B and Class C shares only. Class I net investment income per
share data reflect the transfer agent fee per share applicable to Class I shares
only.
Class A, Class B and Class C ratios are calculated by adjusting the expense and
net investment income ratios for the Fund for the entire period by the service
fee applicable to Class A, Class B and Class C shares and the distribution fee
applicable to Class B and Class C shares only. Class I ratios are calculated by
adjusting the expense and net investment income ratios for the Fund for the
entire period by the transfer agent fee applicable to Class I shares only.
FEDERAL INCOME TAXES: Consistent with the Funds' policy to qualify as a
regulated investment company and to distribute all of its taxable income, no
federal income tax has been accrued.
INTEREST INCOME, DEBT DISCOUNT AND PREMIUM: Interest income is recorded on the
accrual basis. Original issue discount is accreted to interest income over the
life of a
78
<PAGE> 81
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2000 (Unaudited)
security with a corresponding increase in the cost basis; market discount is not
accreted. Premium is amortized against interest income with a corresponding
decrease in the cost basis.
DISTRIBUTIONS TO SHAREHOLDERS: Distributions to shareholders (other than the
Oregon Tax-Free) are recorded on the ex-date. The Oregon Tax-Free Fund declares
and records distributions daily and pays monthly.
The amount and character of income and gains to be distributed are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. Reclassifications are made to the Funds' capital accounts
to reflect income and gains available for distribution (or available capital
loss carryforwards) under income tax regulations.
OTHER: Corporate actions are recorded on the ex-date.
The Funds' custodian takes possession through the federal book-entry system of
securities collateralizing repurchase agreements. Collateral is marked-to-market
daily to ensure that the market value of the underlying assets remains
sufficient to protect the Funds. The Funds may experience costs and delays in
liquidating the collateral if the issuer defaults or enters bankruptcy.
ORGANIZATION COSTS: Expenses incurred in connection with the original
organization of the Funds are amortized using the sum of the years digits
method. As of April 30, 2000 the initial organization costs for all Funds except
for Small-Cap Fund have been fully amortized. Crabbe Huson Group, Inc., the
Fund's investment advisor, has agreed that, in the event any of the initial
shares are redeemed during the 60-month period for amortizing the Fund's
organization costs, the Fund will be reimbursed by the investment advisor for
the unamortized balances of such costs in the same proportion as the number of
shares reduced bears to the number of initial shares outstanding at the time of
redemption.
79
<PAGE> 82
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2000 (Unaudited)
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES
MANAGEMENT FEE: Crabbe Huson Group, Inc. (the "Advisor"), is the Investment
Advisor of each Fund and receives a monthly fee based on each Fund's average net
assets as follows:
EQUITY FUND
MANAGED FUND
REAL ESTATE FUND
SMALL-CAP FUND
SPECIAL FUND
1.05% of average daily net assets up to $100,000,000
.90 of 1% of average daily net assets between $100,000,000 and $500,000,000
.65 of 1% of average daily net assets over $500,000,000
INCOME FUND
.80 of 1% of average daily net assets up to $100,000,000
.65 of 1% of average daily net assets between $100,000,000 and $500,000,000
.55 of 1% of average daily nets assets over $500,000,000
OREGON TAX-FREE FUND
.55 of 1% of average daily net assets up to $100,000,000
.50 of 1% of average daily net assets between $100,000,000 and $500,000,000
.45 of 1% of average daily net assets over $500,000,000
CONTRARIAN FUND
.85 of 1% of average daily net assets
ADMINISTRATION FEE: Colonial Management Associates, Inc. (the Administrator),
an affiliate of the Advisor, provides accounting and other services for a
monthly fee equal to 0.05% annually of the Funds' average net assets. The Funds'
Advisor delegates certain of its administrative duties to the Administrator.
BOOKKEEPING FEE: The Administrator provides bookkeeping and pricing services
for a monthly fee equal to $27,000 annually plus 0.035% of the Funds' average
net assets over $50 million.
TRANSFER AGENT: Liberty Funds Services, Inc. (the Transfer Agent), an affiliate
of the Administrator, provides shareholder services for a monthly fee at the
annual rate of 0.236% annually for the Class A, Class B and Class C shares (as
applicable to each Fund) for the Small-Cap Fund, the Special Fund, the Equity
Fund, the Managed Fund and the Real Estate Fund, 0.17% for the Income Fund and
0.13% for the Oregon Tax-Free Fund, plus certain out-of-pocket expenses.
Effective January 1,
80
<PAGE> 83
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2000 (Unaudited)
2000, the Transfer Agent fee was changed to a fee comprised of 0.07% annually of
average net assets plus charges based on the number of shareholder accounts and
transactions. The Transfer Agent also provides shareholder services for a
monthly fee at the annual rate of 0.0025% for the Class I shares of Small-Cap
Fund, the Equity Fund, the Managed Fund and the Income Fund, plus certain
out-of-pocket expenses.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES: Liberty Funds
Distributor, Inc. (the Distributor), a subsidiary of the Administrator, is the
Funds' principal underwriter. For the six months ended April 30, 2000, the Funds
have been advised that the Distributor retained no net underwriting discounts on
the Income and Oregon Tax-Free Funds. For the Equity, Real Estate, Small-Cap,
Special and Contrarian Fund, the Distributor retained $167, $63, $267, $61 and
$814 on sales of the Funds' Class A shares, respectively. There were no
contingent deferred sales charges received on the Small-Cap, Managed, Oregon
Tax-Free, Income and Contrarian Fund. For the Real Estate Fund, the Distributor
received contingent deferred sales charges (CDSC) of none, $1,347 and $22 Class
A, Class B and Class C share redemptions, respectively. For the Equity Fund, the
Distributor received contingent deferred sales charges (CDSC) of none, $3,298
and none on Class A, Class B and Class C redemptions respectively.
Each Fund has adopted a 12b-1 plan (Plan) which requires it to pay the
Distributor a service fee equal to 0.25% annually on Class A, Class B and Class
C net assets as of the 20th of each month. The Plan also requires the payment of
a distribution fee to the Distributor equal to 0.75% annually of the average net
assets attributable to Class B and Class C shares only.
The CDSC and the fees received from the Plan are used principally as repayment
to the Distributor for amounts paid by the Distributor to dealers who sold such
shares.
EXPENSE LIMITS: The Advisor/Administrator have agreed, until further notice, to
waive fees and bear certain Fund expenses to the extent that total Class A,
Class B and Class C expenses (exclusive of service fees, distribution fees,
brokerage commissions, taxes and extraordinary expenses, if any) exceed 1.25%
for the Special Fund, the Small-Cap Fund, the Real Estate Fund, 1.17% for the
Equity Fund and the Managed Fund, 0.73% for the Oregon Tax-Free Fund, 0.55% for
the Income Fund and 1.35% for the Contrarian Fund. The Advisor/Administrator
have also agreed, until further notice, to waive fees and bear certain expenses
to the extent that total Class I expenses (exclusive of service fees,
distribution fees, brokerage commissions, taxes and extraordinary expenses, if
any) exceed 1.00% for the Small-Cap Fund, the Equity Fund and the Managed Fund
and 0.38% for the Income Fund.
OTHER: The Funds pay no compensation to their officers, all of whom are
employees of the Advisor or Administrator.
81
<PAGE> 84
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2000 (Unaudited)
The Funds' Trustees may participate in a deferred compensation plan which may be
terminated at any time. Obligations of the plan will be paid solely out of the
Fund's assets.
NOTE 4. PORTFOLIO INFORMATION
INVESTMENT ACTIVITY: For the six months ended April 30, 2000, purchases and
sales of investments, other than short-term obligations, were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
----------- ------------
<S> <C> <C>
Contrarian Fund $2,301,848 $ 1,888,962
Equity Fund 67,176,032 89,581,102
Managed Fund 22,477,952 160,343,866
Real Estate Fund 2,948,223 5,624,659
Small Cap Fund 9,473,585 20,990,983
Special Fund 641,380 26,090,667
Income Fund 1,835,657 2,188,289
Oregon Tax-Free Fund -- 3,775,472
</TABLE>
Unrealized appreciation (depreciation) at April 30, 2000, based on cost of
investments for both financial statement and federal income tax purposes was:
<TABLE>
<CAPTION>
CONTRARIAN EQUITY MANAGED REAL ESTATE
---------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Gross unrealized
appreciation $ 879,176 $17,438,698 $4,595,278 $ 350,144
Gross unrealized
depreciation (209,927) (4,792,102) (1,983,270) (711,075)
--------- ----------- ----------- ---------
Net unrealized
appreciation
(depreciation) $ 669,249 $12,646,596 $2,612,008 $(360,931)
--------- ----------- ----------- ---------
</TABLE>
<TABLE>
<CAPTION>
OREGON
SMALL CAP SPECIAL INCOME TAX-FREE
----------- ------------ --------- ---------
<S> <C> <C> <C> <C>
Gross unrealized
appreciation $3,425,223 $ 5,070,682 $ 48,264 $ 239,907
Gross unrealized
depreciation (8,106,480) (10,415,031) (266,588) (902,303)
----------- ------------ --------- ---------
Net unrealized
appreciation
(depreciation) $(4,681,257) $ (5,344,349) $(218,324) $(662,396)
----------- ------------ --------- ---------
</TABLE>
82
<PAGE> 85
CRABBE HUSON FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2000 (Unaudited)
CAPITAL LOSS CARRYFORWARDS: At October 31, 1999, capital loss carryforwards
available (to the extent provided in regulations) to offset future realized
gains were as follows:
<TABLE>
<CAPTION>
YEAR OF CAPITAL LOSS
EXPIRATION CARRY FORWARD
---------- -------------
<S> <C> <C>
Crabbe Huson
Small Cap Fund 2007 $22,808,761
Crabbe Huson
Real Estate Fund 2007 193,496
Crabbe Huson 2006 20,747,182
Special Fund 2007 27,656,752
-----------
48,403,934
Crabbe Huson
Contrarian Fund 2007 2,021
</TABLE>
OTHER: There are certain risks arising from geographic concentration in any
state. Certain revenue or tax related events in a state may impair the ability
of certain issuers of municipal securities to pay principal and interest on
their obligations.
The Funds may focus their investments in certain industries, subjecting them to
a greater risk than a fund that is more diversified.
NOTE 5. LINE OF CREDIT
The Funds (other than the Special Fund) may borrow up to 33 1/3% of its net
assets under a line of credit for temporary or emergency purposes. Any
borrowings bear interest at one of the following options determined at the
inception of the loan: (1) federal funds rate plus 1/2 of 1%, (2) the lending
bank's base rate or (3) IBOR offshore loan rate plus 1/2 of 1%. There were no
borrowings under the line of credit during the six months ended April 30, 2000.
The Special Fund may borrow the lesser of $25 million or 33 1/3% of its total
assets on a secured basis. When the Special Fund borrows it must put in a
segregated account debt securities, domestic or foreign equities, or commercial
paper in an amount equal to at least 200% of the amount borrowed. The Fund must
maintain the segregated account daily to ensure that its value is at least equal
to 200% of the funds borrowed at all times. No single issuer, other than U.S.
Government and U.S. Government agencies, can comprise in excess of 10% of the
segregated account. For the six months ended April 30, 2000, the Special Fund
had $3,500,000 of borrowings outstanding.
83
<PAGE> 86
CRABBE HUSON CONTRARIAN FUND
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF EACH CLASS OUTSTANDING THROUGHOUT EACH PERIOD ARE
AS FOLLOWS:
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS ENDED 04/30/2000
-------------------------------------------
--------------------------------------------------
CLASS A CLASS B CLASS C
--------------------------------------------------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........................ $10.390 $10.330 $10.320
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (Loss) (a)............................ 0.001 (0.042) (0.042)
Net Realized & Unrealized Gain.............................. 2.459 2.432 2.432
------- ------- -------
Total from Investment Operations........................ 2.460 2.390 2.390
--------------------------------------------------
NET ASSET VALUE, END OF PERIOD.............................. $12.850 $12.720 $12.710
==================================================
TOTAL RETURN (B)(C)(D)...................................... 23.68% 23.14% 23.16%
RATIOS TO AVERAGE NET ASSETS
Expenses (e)(f)............................................. 1.60% 2.35% 2.35%
Net Investment Income (e)(f)................................ (0.86)% (1.61)% (1.61)%
Fees and Expenses Waived or Borne by the Advisor (e)(f)..... 2.95% 2.95% 2.95%
Portfolio Turnover (d)...................................... 50% 50% 50%
Net Assets, End of Period (000's)........................... $ 4,100 $ 419 $ 33
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return of net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(c) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(f) Annualized.
84
<PAGE> 87
CRABBE HUSON CONTRARIAN FUND
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF EACH CLASS OUTSTANDING THROUGHOUT EACH PERIOD ARE
AS FOLLOWS:
<TABLE>
<CAPTION>
PERIOD ENDED 10/31/1999(B)
---------------------------------------------
----------------------------------------------------
CLASS A CLASS B CLASS C
----------------------------------------------------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........................ $10.000 $10.000 $10.000
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)................................... (0.015) (0.091) (0.089)
Net Realized & Unrealized Gain (Loss)....................... 0.405 0.421 0.409
----------------------------------------------------
Total from Investment Operations........................ 0.390 0.330 0.320
----------------------------------------------------
NET ASSET VALUE, END OF PERIOD.............................. $10.390 $10.330 $10.320
====================================================
TOTAL RETURN (C)(D)......................................... 3.90%(e) 3.30%(e) 3.20%(e)
RATIOS TO AVERAGE NET ASSETS
Expenses (f)(g)............................................. 1.60% 2.35% 2.35%
Net Investment Income (f)(g)................................ (0.15)% (0.90)% (0.90)%
Fees and Expenses Waived or Borne by the Advisor (f)(g)..... 3.56% 3.56% 3.56%
Portfolio Turnover Rate (e)................................. 105% 105% 105%
Net Assets, End of Period (000's)........................... $ 3,279 $ 209 $ 9
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) The Fund commenced investment operations on December 1, 1998.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(g) Annualized.
85
<PAGE> 88
CRABBE HUSON EQUITY FUND
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF EACH CLASS OUTSTANDING THROUGHOUT EACH PERIOD ARE
AS FOLLOWS:
<TABLE>
<CAPTION>
SIX MONTHS ENDED 4/30/2000
---------------------------------------------------------------
CLASS A CLASS B(B) CLASS C(B) CLASS I
---------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 16.780 $ 16.660 $16.670 $16.820
---------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)................................... 0.028 (0.036) (0.037) 0.050
Net Realized and Unrealized Gain............................ 2.430 2.404 2.395 2.458
---------------------------------------------------------------
Total from Investment Operations........................ 2.458 2.368 2.358 2.508
LESS DISTRIBUTIONS
Distributions from Capital Gains............................ (0.518) (0.518) (0.518) (0.518)
---------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.............................. $ 18.720 $ 18.510 $18.510 $18.810
===============================================================
TOTAL RETURN (C)(D)(E)...................................... 14.95% 14.51% 14.44 % 15.22%
RATIOS TO AVERAGE NET ASSETS
Expenses (f)(g)............................................. 1.39% 2.14% 2.14 % 1.32%
Net Investment Income (f)(g)................................ 0.33% (0.42)% (0.42)% 0.39%
Fees and Expenses Waived or Borne by the Advisor (f)(g)..... 0.37% 0.37% 0.37 % 0.37%
Portfolio Turnover Rate (e)................................. 65% 65% 65 % 65%
Net Assets, End of Period (000's)........................... $ 89,742 $ 481 $11 $10,874
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class B and Class C shares were initially offered on January 27, 1999. Per
share amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expense, total return
would have been reduced.
(e) Not Annualized.
(f) The benefits derived from custody credits and direct brokerage arrangements
had no impact.
(g) Annualized.
86
<PAGE> 89
CRABBE HUSON EQUITY FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED 10/31/99 YEAR ENDED 10/31/98
------------------------------------------------------------------------------------
CLASS A CLASS B(B) CLASS C(B) CLASS I CLASS A(C) CLASS I(C)
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD....... $16.600 $16.440 $16.440 $16.650 $ 23.320 $23.400
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a).................. 0.031 (0.076) (0.076) 0.115 0.070 0.370
Net Realized & Unrealized Gain (Loss)...... 0.550 0.296 0.306 0.818 (2.000) (2.030)
------------------------------------------------------------------------------------
Total from Investment Operations....... 0.860 0.220 0.230 0.933 (1.930) (1.860)
LESS DISTRIBUTIONS
Distributions from Net Investment Income... (0.099) -- -- (0.182) (0.050) (0.150)
Distributions from Capital Gains........... (0.581) -- -- (0.581) (4.740) (4.740)
------------------------------------------------------------------------------------
Total Distributions.................... (0.680) -- -- (0.763) (4.790) (4.890)
------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD............. $16.780 $16.660 $16.670 $16.820 $ 16.600 $16.650
====================================================================================
TOTAL RETURN (D)(E)........................ 5.29% 1.34 %(f) 1.40 %(f) 5.75% (10.08)% (9.72)%
RATIOS TO AVERAGE NET ASSETS
Expenses................................... 1.42%(g) 2.17 %(g) 2.17 %(g) 0.93%(g) 1.39%(h) 1.01%(h)
Net Investment Income...................... 0.18%(g) (0.56)%(g) (0.56)%(g) 0.67%(g) 0.38%(h) 0.76%(h)
Fees and Expenses Waived or Borne by the
Advisor.................................. 0.28%(g) 0.28 %(g) 0.28 %(g) 0.28%(g) 0.03% 0.12%
Portfolio Turnover Rate.................... 134% 134 % 134 % 134% 1% 1%
Net Assets, End of Period (000's).......... $102,428 $ 466 $ 6 $14,190 $226,628 $27,672
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class B and Class C shares were initially offered on January 27, 1999. Per
share amounts reflect activity from that date.
(c) Effective October 19, 1998, the Primary and Institutional shares were
redesignated Class A and Class I shares, respectively.
(d) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(e) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(h) Includes expenses paid indirectly through directed brokerage and certain
expense offset arrangements.
87
<PAGE> 90
CRABBE HUSON EQUITY FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR
ENDED
YEAR ENDED 10/31/1997 YEAR ENDED 10/31/1996 10/31/1995
----------------------------------------------------------------------------------------
CLASS A CLASS I CLASS A CLASS I(B)
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD... $19.500 $19.510 $18.170 $19.820 $ 16.440
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a).............. 0.070 0.210 0.110 0.000 0.220
Net Realized & Unrealized Gain
(Loss)............................... 5.360 5.310 2.330 (0.310) 1.750
----------------------------------------------------------------------------------------
Total from Investment Operations... 5.430 5.520 2.440 (0.310) 1.970
LESS DISTRIBUTIONS
Distributions from Net Investment
Income............................... (0.070) (0.090) (0.170) 0.000 (0.090)
Distributions from Capital Gains....... (1.540) (1.540) (0.940) 0.000 (0.150)
----------------------------------------------------------------------------------------
Total Distributions................ (1.610) (1.630) (1.110) 0.000 (0.240)
----------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD......... $23.320 $23.400 $19.500 $19.510 $ 18.170
========================================================================================
TOTAL RETURN (c)(d).................... 29.87% 30.35% 13.78% (1.56)%(e) 13.37%
RATIOS TO AVERAGE NET ASSETS
Expenses............................... 1.42%(f) 1.00%(f) 1.38%(f) 1.00 %(f)(g) 1.40%
Net Investment Income.................. 0.29%(f) 0.71%(f) 0.56%(f) 0.15 %(f)(g) 1.30%
Fees and Expenses Waived or Borne by
the Advisor.......................... 0.02% 0.23% -- 0.58 %(g) 0.02%
Portfolio Turnover Rate................ 129% 129% 117% 117 % 92%
Net Assets, End of Period (000's)...... $380,047 $24,084 $436,578 $ 4,415 $387,184
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class I shares were initially offered on October 3, 1996. Per share amounts
reflect activity from that date.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(e) Not annualized.
(f) Includes expenses paid indirectly through directed brokerage and certain
expense offset arrangements.
(g) Annualized.
88
<PAGE> 91
CRABBE HUSON MANAGED INCOME & EQUITY FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED 4/30/2000
----------------------------------------------------------------------------------
CLASS A(B) CLASS B(C) CLASS C(C) CLASS I(B)
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD......... $12.790 $12.770 $12.770 $12.770
----------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a).................... 0.152 0.105 0.105 0.167
Net Realized and Unrealized Gain............. 0.943 0.913 0.913 0.948
----------------------------------------------------------------------------------
Total from Investment Operations......... 1.095 1.018 1.018 1.115
----------------------------------------------------------------------------------
LESS DISTRIBUTIONS
Distributions from Net Investment Income..... (0.200) (0.153) (0.153) (0.230)
Distributions from Capital Gains............. (0.865) (0.865) (0.865) (0.865)
----------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD............... $12.820 $12.770 $12.770 $12.790
==================================================================================
TOTAL RETURN (D)(E).......................... 9.01%(f) 8.44%(f) 8.44%(f) 9.29%(f)
RATIOS TO AVERAGE NET ASSETS
Expenses..................................... 1.48%(g)(h) 2.49%(g)(h) 2.49%(g)(h) 1.34%(g)(h)
Net Investment Income........................ 2.44%(g)(h) 1.43%(g)(h) 1.43%(g)(h) 2.59%(g)(h)
Fees and Expenses Waived or Borne by the
Advisor.................................... 0.26%(g)(h) 0.00% 0.00% 0.11%(g)(h)
Portfolio Turnover........................... 46%(f) 46%(f) 46%(f) 46%(f)
Net Assets, End of Period (000's)............ $27,712 $ 30 $ 3 $14,142
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Effective October 19, 1998, the Primary and Institutional shares were
redesignated Class A and Class I respectively.
(c) Class B and Class C shares were initially offered on January 27, 1999. Per
share amounts reflect activity from that date.
(d) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deffered sales charge.
(e) Had the Advisor not waived or reimbursed a portion of expense, total return
would have been reduced.
(f) Not Annualized.
(g) The benefits derived from custody credits and direct brokerage arrangements
had no impact.
(h) Annualized.
89
<PAGE> 92
CRABBE HUSON MANAGED INCOME & EQUITY FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED 10/31/1999 YEAR ENDED 10/31/1998
-----------------------------------------------------------------------------------
CLASS A CLASS B(B) CLASS C(B) CLASS I CLASS A(C) CLASS I(C)
-----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........ $12.810 $12.760 $12.760 $12.810 $14.940 $14.940
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)................... 0.275 0.143 0.143 0.334 0.290 0.320
Net Realized & Unrealized Gain (Loss)....... 0.262 0.016 0.016 0.269 (0.370) (0.370)
-----------------------------------------------------------------------------------
Total from Investment Operations........ 0.537 0.159 0.159 0.603 (0.080) (0.050)
LESS DISTRIBUTIONS
Distributions from Net Investment Income.... (0.281) (0.149) (0.149) (0.367) (0.240) (0.270)
Distributions from Capital Gains............ (0.276) -- -- (0.276) (1.810) (1.810)
-----------------------------------------------------------------------------------
Total Distributions..................... (0.557) -- -- (0.643) (2.050) (2.080)
-----------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.............. $12.790 $12.770 $12.770 $12.770 $12.810 $12.810
===================================================================================
TOTAL RETURN (d)(e)......................... 4.22% 1.18%(f) 1.18%(f) 4.75% (0.69)% (0.44)%
RATIOS TO AVERAGE NET ASSETS
Expenses.................................... 1.42%(g) 2.17%(g)(i) 2.17%(g)(i) 0.96%(g) 1.32%(h) 1.01%(h)
Net Investment Income....................... 2.08%(g) 1.40%(g)(i) 1.40%(g)(i) 2.54%(g) 2.27%(h) 2.58%(h)
Fees and Expenses Waived or Borne by the
Advisor................................... 0.33%(g) 0.40%(g)(i) 0.40%(g)(i) 0.33%(g) 0.16% 0.24%
Portfolio Turnover Rate..................... 99% 99% 99% 99% 115% 115%
Net Assets, End of Period (000's)........... $37,791 $ 29 $ 3 $21,188 $67,681 $33,723
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class B and Class C shares were initially offered on January 27, 1999. Per
share amounts reflect activity from that date.
(c) Effective October 19, 1998, the Primary and Institutional shares were
redesignated Class A and Class I shares, respectively.
(d) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(e) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(h) Includes expenses paid indirectly through directed brokerage and certain
expense offset arrangements.
(i) Annualized.
90
<PAGE> 93
CRABBE HUSON MANAGED INCOME & EQUITY FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR
ENDED
YEAR ENDED 10/31/1997 YEAR ENDED 10/31/1996 10/31/1995
-----------------------------------------------------------------------------
CLASS A CLASS I CLASS A CLASS I(D)
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD.............. $13.390 $13.390 $ 13.640 $13.380 $ 12.870
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)......................... 0.320 0.420 0.300 0.010 0.340
Net Realized & Unrealized Gain (Loss)............. 2.290 2.240 0.880 0.080 1.210
-----------------------------------------------------------------------------
Total from Investment Operations.............. 2.610 2.660 1.180 0.090 1.550
LESS DISTRIBUTIONS
Distributions from Net Investment Income.......... (0.320) (0.370) 0.300 (0.080) (0.330)
Distributions from Capital Gains.................. (0.740) (0.740) 1.130 -- (0.450)
-----------------------------------------------------------------------------
Total Distributions........................... (1.060) (1.110) 1.430 (0.080) (0.780)
-----------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.................... $14.940 $14.940 $ 13.390 $13.390 $ 13.640
=============================================================================
TOTAL RETURN (d)(e)............................... 20.60% 21.18% 8.96% 0.59%(g) 13.00%
RATIOS TO AVERAGE NET ASSETS
Expenses.......................................... 1.42%(j) 1.00%(j) 1.47%(j) 1.00%(i)(j) 1.48%
Net Investment Income............................. 2.25%(j) 2.70%(j) 2.22%(j) 2.87%(i)(j) 2.57%
Fees and Expenses Waived or Borne by the
Advisor......................................... 0.13% 0.42% -- 1.00%(i) 0.01%
Portfolio Turnover Rate........................... 119% 119% 252% 252% 226%
Net Assets, End of Period (000's)................. $95,960 $28,598 $125,018 $ 2,526 $136,530
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class B and Class C shares were initially offered on January 27, 1999. Per
share amounts reflect activity from that date.
(c) Effective October 19, 1998, the Primary and Institutional shares were
redesignated Class A and Class I shares, respectively.
(d) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(e) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(h) Includes expenses paid indirectly through directed brokerage and certain
expense offset arrangements.
(i) Annualized.
91
<PAGE> 94
CRABBE HUSON REAL ESTATE INVESTMENT FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
Selected data for a share of each class outstanding throughout the period are as
follows:
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS ENDED 4/30/2000
------------------------------------------------------------------
CLASS A CLASS B CLASS C CLASS Z
------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........................ $9.550 $9.550 $9.540 $ 9.560
------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)................................... 0.160 0.125 0.125 0.172
Net Realized and Unrealized Gain............................ 0.690 0.691 0.691 0.680
------------------------------------------------------------------
Total from Investment Operations........................ 0.850 0.816 0.816 0.851
------------------------------------------------------------------
LESS DISTRIBUTION
Distributions from Net Investment Income.................... (0.450) (0.416) (0.416) (0.461)
------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.............................. $9.950 $9.950 $9.940 $ 9.950
==================================================================
TOTAL RETURN (B)(C)(D)...................................... 9.52% 9.10% 9.11% 9.54%
RATIOS TO AVERAGE NET ASSETS
Expenses (e)(f)............................................. 1.50% 2.25% 2.25% 1.25%
Net Investment Income (Loss) (e)(f)......................... 3.46% 2.71% 2.71% 3.71%
Fees and Expenses Waived or Borne by the Advisor (e)(f)..... 1.13% 1.13% 1.13% 1.13%
Portfolio Turnover Rate..................................... 38% 38% 38% 38%
Net Assets, End of Period (000's)........................... $6,246 $ 931 $ 91 $ 387
------------------------
(a) Per share data was calculated using average shares outstanding during the period.
(b) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred
sales charge.
(c) Had the Advisor not waived or reimbursed a portion of expenses, total return would have been reduced.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage arrangements had no impact.
(f) Annualized.
</TABLE>
92
<PAGE> 95
CRABBE HUSON REAL ESTATE INVESTMENT FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED 10/31/1999
----------------------------------------------------------------------
CLASS A CLASS B(b) CLASS C(b) CLASS Z(b)
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD..................... $10.440 $10.580 $10.580 $10.440
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)................................ 0.581 0.424 0.425 0.495
Net Realized & Unrealized Loss........................... (0.939) (1.269) (1.280) (1.129)
----------------------------------------------------------------------
Total from Investment Operations..................... (0.358) (0.845) (0.855) (0.634)
LESS DISTRIBUTIONS
Distributions from Net Investment Income................. (0.357) (0.185) (0.185) (0.246)
Distributions from Capital Gains......................... (0.175) -- -- --
----------------------------------------------------------------------
Total Distributions.................................. (0.532) (0.185) (0.185) (0.246)
----------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD........................... $ 9.550 $ 9.550 $ 9.540 $ 9.560
======================================================================
TOTAL RETURN (C)(D)...................................... (3.73)% (8.12)%(e) (8.21)%(e) (6.24)%(e)
RATIOS TO AVERAGE NET ASSETS
Expenses (f)............................................. 1.50% 2.25 %(g) 2.25 %(g) 1.25 %(g)
Net Investment Income (f)................................ 5.59% 5.01 %(g) 5.01 %(g) 6.04 %(g)
Fees and Expenses Waived or Borne by the Advisor (f)..... 0.81% 0.98 %(g) 0.98 %(g) 0.98 %(g)
Portfolio Turnover Rate.................................. 82% 82 % 82 % 82 %
Net Assets, End of Period (000's)........................ $ 8,185 $ 764 $ 64 $ 493
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class B, Class C shares were initially offered on January 27, 1999. Class Z
shares were initially offered on January 29, 1999. Per share amounts reflect
activity from that date.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor or its affiliates not waived or reimbursed a portion of
expenses, total return would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(g) Annualized.
93
<PAGE> 96
CRABBE HUSON REAL ESTATE INVESTMENT FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
10/31/1998 10/31/1997 10/31/1996 10/31/1995
-----------------------------------------------------------------------
CLASS A(b)
-----------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD.................... $14.090 $11.580 $ 9.690 $ 9.500
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)............................... 0.400 0.380 0.380 0.440
Net Realized & Unrealized Gain (Loss)................... (2.000) 3.020 2.010 0.310
----------------------------------------------------------------------
Total from Investment Operations.................... (1.600) 3.400 2.390 0.750
LESS DISTRIBUTIONS
Distributions from Net Investment Income................ (0.360) (0.380) (0.380) (0.440)
Distributions from Capital Gains........................ (1.690) (0.510) (0.120) (0.120)
----------------------------------------------------------------------
Total Distributions................................. (2.050) (0.890) (0.500) (0.560)
----------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.......................... $10.440 $14.090 $11.580 $ 9.690
======================================================================
TOTAL RETURN (C)(D)..................................... (13.39)% 30.56% 25.39% 8.31%
RATIOS TO AVERAGE NET ASSETS
Expenses................................................ 1.50 %(e) 1.50% 1.50% 1.50%
Net Investment Income................................... 3.71 %(e) 2.93% 3.59% 4.59%
Fees and Expenses Waived or Borne by the Advisor........ 0.42 %(e) 0.26% 0.38% 0.39%
Portfolio Turnover Rate................................. 97 % 80% 120% 60%
Net Assets, End of Period (000's)....................... $17,423 $34,259 $20,649 $18,986
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Effective October 19, 1998, the Primary shares were redesignated Class A
shares.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(e) Includes expenses paid indirectly through directed brokerage and certain
expense offset arrangements.
94
<PAGE> 97
CRABBE HUSON SMALL CAP FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED 04/30/2000
---------------------------------------
CLASS A CLASS I
---------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 8.130 $ 8.200
INCOME FROM INVESTMENT OPERATIONS
------------------------------------------------------------
Net Investment Loss (a)..................................... (0.040) (0.028)
Net Realized and Unrealized Gain............................ 2.880 2.898
-------------------------------------
Total from Investment Operations........................ 2.840 2.870
-------------------------------------
NET ASSET VALUE, END OF PERIOD.............................. $10.970 $11.070
=====================================
TOTAL RETURN (c)(d)......................................... 34.93%(e) 35.00 %(e)
RATIOS TO AVERAGE NET ASSETS
------------------------------------------------------------
Expenses.................................................... 1.29%(e)(f) 1.05 %(e)(f)
Net Investment Income....................................... (0.79)%(e)(f) (0.54)%(e)(f)
Fees and Expenses Waived or Borne by the Advisor............ 0.56%(e)(f) 0.56 %(e)(f)
Portfolio Turnover Rate..................................... 29%(d) 29 %(d)
Net Assets, End of Period (000's)........................... $ 6,375 $23,766
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(c) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(d) Not annualized
(e) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(f) Annualized.
95
<PAGE> 98
CRABBE HUSON SMALL CAP FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED 10/31/1999 YEAR ENDED 10/31/1998
-----------------------------------------------------------------------
CLASS A CLASS I CLASS A(b) CLASS I(b)
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD.................... $8.650 $8.680 $15.480 $15.530
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (Loss) (a)........................ (0.078) (0.035) (0.030) 0.030
Net Realized & Unrealized Loss.......................... (0.391) (0.394) (5.560) (5.580)
-----------------------------------------------------------------------
Total from Investment Operations.................... (0.469) (0.429) (5.590) (5.550)
LESS DISTRIBUTIONS
Distributions from Net Investment Income................ -- -- -- (0.010)
Distributions in Excess of Net Investment Income........ -- -- -- (0.050)
Distributions from Net Realized Gains................... (0.039) (0.039) (1.240) (1.240)
Distributions in Excess of Net Realized Gains........... (0.012) (0.012) -- --
-----------------------------------------------------------------------
Total Distributions................................. (0.051) (0.051) (1.240) (1.300)
-----------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.......................... $8.130 $8.200 $ 8.650 $ 8.680
=======================================================================
TOTAL RETURN (c)(d)..................................... (5.48)% (5.00)% (38.64)% (38.37)%
RATIOS TO AVERAGE NET ASSETS
Expenses (e)............................................ 1.50% 1.00% 1.37 % 1.00 %
Net Investment Income (e)............................... (0.89)% (0.39)% (0.65)% (0.28)%
Fees and Expenses Waived or Borne by the Advisor (e).... 0.41% 0.42% 0.25 % 0.21 %
Portfolio Turnover Rate................................. 12% 12% 30 % 30 %
Net Assets, End of Period (000's)....................... $6,895 $24,481 $14,462 $62,539
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Effective October 19, 1998, the Primary and Institutional shares were
redesignated Class A and Class I shares, respectively.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(e) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
96
<PAGE> 99
CRABBE HUSON SMALL CAP FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED 10/31/1997 PERIOD ENDED 10/31/1996(B)
------------------------------------------------------------------------
CLASS A CLASS I CLASS A CLASS I
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD................... $11.020 $11.010 $10.000 $11.050
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a).............................. -- 0.070 0.030 --
Net Realized & Unrealized Gain (Loss).................. 4.620 4.620 0.990 (0.040)
------------------------------------------------------------------------
Total from Investment Operations................... 4.620 4.690 1.020 (0.040)
LESS DISTRIBUTIONS
Distributions from Net Investment Income............... (0.020) (0.030) -- --
Distributions in Excess of Net Investment Income....... -- -- -- --
Distributions from Capital Gains....................... (0.140) (0.140) -- --
------------------------------------------------------------------------
Total Distributions................................ (0.160) (0.170) -- --
------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD......................... $15.480 $15.530 $11.020 $11.010
========================================================================
TOTAL RETURN (c)(d).................................... 42.38% 43.11% 10.20%(e) (0.36)%(e)
RATIOS TO AVERAGE NET ASSETS
Expenses (f)........................................... 1.50% 1.00% 1.51%(g) 1.00 %(g)
Net Investment Income (f).............................. 0.03% 0.60% 0.70%(g) (0.43)%(g)
Fees and Expenses Waived or Borne by the Advisor (f)... 0.23% 0.28% 0.81%(g) 2.55 %(g)
Portfolio Turnover Rate................................ 65% 65% 39% 39 %
Net Assets, End of Period (000's)...................... $42,563 $71,655 $19,156 $ 1,514
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) The Fund commenced investment operations on October 10, 1996.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(e) Not annualized.
(f) Includes expenses paid indirectly through directed brokerage and certain
expense offset arrangements.
(g) Annualized.
97
<PAGE> 100
CRABBE HUSON SPECIAL FUND
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS YEAR ENDED 10/31
ENDED ----------------------------------------------------------------
04/30/2000 1999 1998(C) 1997 1996 1995
---------------------------------------------------------------------------------------
CLASS A CLASS A CLASS A
--------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year...... $ 6.97 $ 8.10 $ 16.80 $ 13.71 $ 13.80 $ 14.08
---------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)(b)............ (0.021) (0.069) 0.070 0.150 0.140 0.270
Net Realized and Unrealized Gains on
Investments........................... 2.361 (1.061) (6.920) 3.410 0.550 (0.290)
---------------------------------------------------------------------------------------
Total from Investment Operations.... 2.340 (1.130) (6.850) 3.560 0.690 (0.020)
---------------------------------------------------------------------------------------
LESS DISTRIBUTIONS
Dividends from Net Investment Income.... -- -- (0.140) (0.140) (0.210) (0.020)
Return of Capital....................... -- -- (0.020) -- -- --
Distributions from Net Realized Gains on
Investments........................... -- -- (1.690) (0.330) (0.570) (0.240)
---------------------------------------------------------------------------------------
Total Distributions................. -- -- (1.850) (0.470) (0.780) (0.260)
---------------------------------------------------------------------------------------
NET ASSET VALUE, END OF YEAR............ $ 9.310 $6.970 $ 8.100 $16.800 $ 13.710 $ 13.800
=======================================================================================
TOTAL RETURN(D)(E)...................... 33.57 %(f) (13.95)% (44.94)% 26.62% 5.03% 1.78%
RATIOS TO AVERAGE NET ASSETS
Expenses................................ 1.50 %(g) 1.50% 1.50% 1.50% 1.37% 1.40%
Net Investment Income................... (0.75)%(g) (0.85)% 0.40% 0.86% 0.72% 1.95%
Fees and Expenses Waived or Borne by the
Advisor............................... 1.93 %(g)
Portfolio Turnover Rate................. 1 %(f) 11% 22% 33% 33% 123%
Net Assets, End of Year (000's)......... $44,419 $47,472 $104,504 $396,335 $481,039 $878,560
</TABLE>
------------------------
(a) Net of fees and expenses waived or borne by the Advisor which amounted to:
$0.083
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Effective October 19, 1998, the Primary shares were redesignated Class A
shares.
(d) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(e) Had the Advisor not waived or reimbursed a portion of the expenses, total
return would have been reduced.
(f) Not annualized.
(g) Annualized.
98
<PAGE> 101
CRABBE HUSON CONTRARIAN INCOME FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED 04/30/2000
-------------------------------------------------------------------
CLASS A CLASS B CLASS C CLASS I CLASS Z
-------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........................ $10.110 $10.130 $10.150 $10.100 $10.110
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)................................... 0.299 0.261 0.262 0.312 0.312
Net Realized and Unrealized Loss............................ (0.343) (0.260) (0.308) (0.398) (0.401)
-------------------------------------------------------------------
Total from Investment Operations........................ (0.044) 0.001 (0.046) (0.086) (0.089)
LESS DISTRIBUTIONS
Distributions from Net Investment Income.................... (0.250) (0.163) (0.180) (0.299 (0.279)
Distributions from Capital Gains............................ (0.054) (0.054) (0.054) (0.054) (0.054)
-------------------------------------------------------------------
Total Distributions..................................... (0.304) (0.217) (0.234) (0.353) (0.333)
-------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.............................. $ 9.970 $10.050 $10.020 $9.910 $ 9.920
===================================================================
TOTAL RETURN (b)(c)......................................... 1.65%(d)(e) 1.36% 1.04% 1.65% 1.44%
RATIOS TO AVERAGE NET ASSETS
Expenses (e)(f)............................................. 0.79% 1.54% 1.54% 0.54% 0.54%
Net Investment Income (e)(f)................................ 5.98% 5.23% 5.23% 6.27% 6.23%
Fees and Expenses Waived or Borne by the Advisor (e)(f)..... 1.31% 1.31% 1.31% 1.31% 1.31%
Portfolio Turnover Rate (d)................................. 24% 24% 24% 24% 24%
Net Assets, End of Period (000's)........................... $ 3,583 $ 85 $ 1 $ 102 $ 4,006
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(c) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(d) Not annualized.
(e) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(f) Annualized.
99
<PAGE> 102
CRABBE HUSON CONTRARIAN INCOME FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED 10/31/1999
------------------------------------------------------------------------
CLASS A CLASS B(b) CLASS C(b) CLASS Z(b) CLASS I
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD................... $10.880 $10.170 $10.170 $10.170 $10.900
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a).............................. 0.583 0.020 0.013 0.007 0.607
Net Realized & Unrealized Loss on Investments.......... (0.538) 0.002 0.037 0.046 (0.512)
------------------------------------------------------------------------
Total from Investment Operations................... 0.045 0.022 0.050 0.053 0.095
LESS DISTRIBUTIONS
Distributions from Net Investment Income............... (0.620) (0.062) (0.070) (0.113) (0.700)
Distributions from Capital Gains....................... (0.195) -- -- -- (0.195)
------------------------------------------------------------------------
Total Distributions................................ (0.815) (0.062) (0.070) (0.113) (0.895)
------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD......................... $10.110 $10.130 $10.150 $10.110 $10.100
========================================================================
TOTAL RETURN (C)(D).................................... 0.42% 0.22%(e) 0.49%(e) 0.53%(e) 0.90%
RATIOS TO AVERAGE NET ASSETS
Expenses (f)........................................... 0.80% 1.55%(g) 1.55%(g) 0.55%(g) 0.38%
Net Investment Income (f).............................. 5.57% 4.46%(g) 4.46%(g) 5.46%(g) 5.99%
Fees and Expenses Waived or Borne by the Advisor (f)... 2.24% 5.84%(g) 5.84%(g) 5.84%(g) 2.36%
Portfolio Turnover Rate................................ 196% 196% 196% 196% 196%
Net Assets, End of Period (000's)...................... $ 3,843 $ 16 $ 1 $ 4,246 $ 101
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Class B, Class C and Class Z shares were initially offered on September 15,
1999.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(g) Annualized.
100
<PAGE> 103
CRABBE HUSON CONTRARIAN INCOME FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED YEAR ENDED
YEAR ENDED 10/31/98 10/31/97 10/31/96 10/31/95
--------------------------------------------------------------------------
CLASS A(B) I(C)
--------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD............ $10.580 $10.990 $10.200 $10.260 $ 9.710
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income (a)....................... 0.500 0.020 0.620 0.540 0.530
Net Realized & Unrealized Gain (Loss) on
Investments................................... 0.590 (0.070) 0.380 (0.050) 0.580
--------------------------------------------------------------------------
Total from Investment Operations............ 1.090 (0.050) 1.000 0.490 1.110
LESS DISTRIBUTIONS
Distributions from Net Investment Income........ (0.790) (0.040) (0.620) (0.550) (0.530)
Distributions in Excess of Net Investment
Income........................................ -- -- -- -- (0.030)
--------------------------------------------------------------------------
Total Distributions......................... (0.790) (0.040) (0.620) (0.550) (0.560)
--------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD.................. $10.880 $10.900 $10.580 $10.200 $10.260
==========================================================================
TOTAL RETURN (D)(E)............................. 11.21% (0.45)%(f) 10.25% 4.94% 11.92%
RATIOS TO AVERAGE NET ASSETS
Expenses........................................ 0.80%(g) 0.38 %(g)(h) 0.80% 0.80% 0.80%
Net Investment Income........................... 5.36%(g) 5.88 %(g)(h) 5.96% 5.31% 5.47%
Fees and Expenses Waived or Borne by the
Advisor....................................... 1.56%(g) 4.62 %(g)(h) 1.98% 1.49% 1.15%
Portfolio Turnover Rate......................... 158% 158 % 56% 469% 543%
Net Assets, End of Period (000's)............... $ 8,799 $ 100 $ 3,248 $ 4,694 $ 7,190
</TABLE>
------------------------
(a) Per share data was calculated using average shares outstanding during the
period.
(b) Effective October 19, 1998, the Primary shares were redesignated Class A
shares.
(c) Class I shares were initially offered on October 19, 1998. Per share amounts
reflect activity from that date.
(d) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(e) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(f) Not annualized.
(g) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(h) Annualized.
101
<PAGE> 104
CRABBE HUSON OREGON TAX-FREE FUND
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF EACH CLASS OUTSTANDING THROUGHOUT EACH PERIOD ARE
AS FOLLOWS:
<TABLE>
<CAPTION>
SIX MONTHS ENDED 4/30/2000
----------------------------------
CLASS A CLASS B
----------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD........................ $11.620 $11.620
---------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income....................................... 0.080 0.073
Net Realized & Unrealized Gain (Loss)....................... 0.056 0.056
---------------------------------
Total from Investment Operations........................ 0.136 0.129
LESS DISTRIBUTIONS
Distributions from Net Investment Income.................... (0.260) (0.216)
Distributions from Capital Gains............................ (0.085) (0.085)
---------------------------------
(0.345) (0.301)
---------------------------------
NET ASSET VALUE, END OF PERIOD.............................. $ 11.63 $ 11.63
=================================
TOTAL RETURN (A)(B)(C)...................................... 3.10% 2.71%
RATIO TO AVERAGE NET ASSETS
Expenses (d)(e)............................................. 0.89% 1.64%
Net Investment Income (d)(e)................................ 3.08% 3.83%
Fees and Expenses Waived or Borne by the Advisor (d)(e)..... 0.32% 0.32%
Portfolio Turnover (c)...................................... 0% 0%
Net Assets, End of Period (000's)........................... $16,727 $ 53
</TABLE>
------------------------
(a) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(b) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(c) Not annualized.
(d) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(e) Annualized.
102
<PAGE> 105
CRABBE HUSON OREGON TAX-FREE FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
YEAR ENDED 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
--------------------------------------------------------------------------------------
CLASS A CLASS B(A) CLASS A(B)
--------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD..... $13.030 $12.750 $12.780 $12.500 $12.620 $11.990
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income.................... 0.524 0.326 0.280 0.540 0.540 0.550
Net Realized & Unrealized Gain (Loss).... (1.103) (1.147) 0.270 0.280 (0.120) 0.700
--------------------------------------------------------------------------------------
Total from Investment Operations..... (0.579) (0.821) 0.550 0.820 0.420 1.250
LESS DISTRIBUTIONS
Distributions from Net Investment
Income................................. (0.514) (0.309) (0.270) (0.470) (0.540) (0.550)
Distributions from Capital Gains......... (0.317) -- (0.030) (0.070) -- (0.070)
--------------------------------------------------------------------------------------
Total Distributions.................. (0.831) (0.309) (0.300) (0.540) (0.540) (0.620)
--------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD........... $11.620 $11.620 $13.030 $12.780 $12.500 $12.620
======================================================================================
TOTAL RETURN (C)(D)...................... (4.70)% (6.43)%(e) 6.39% 6.67% 3.43% 10.66%
RATIOS TO AVERAGE NET ASSETS
Expenses................................. 0.98%(f) 1.73%(f)(g) 0.98%(f) 0.98% 0.98% 0.98%
Net Investment Income.................... 4.12%(f) 3.39%(f)(g) 4.12%(f) 4.25% 4.33% 4.45%
Fees and Expenses Waived or Borne by the
Advisor................................ 0.32%(f) 0.31%(f)(g) --(f) 0.12% 0.06% 0.10%
Portfolio Turnover Rate.................. 4% 4% 44% 17% 16% 23%
Net Assets, End of Period (000's)........ $20,568 $ 52 $25,591 $26,487 $26,135 $28,070
</TABLE>
------------------------
(a) Class B shares were initially offered on January 27, 1999. Per share amounts
reflect activity from that date.
(b) Effective October 19, 1998, the Primary shares were redesignated Class A
shares.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Had the Advisor not waived or reimbursed a portion of expenses, total return
would have been reduced.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(g) Annualized.
103
<PAGE> 106
THIS PAGE INTENTIONALLY LEFT BLANK
<PAGE> 107
IMPORTANT INFORMATION ABOUT THIS REPORT
THE TRANSFER AGENT FOR
THE CRABBE HUSON FUNDS IS:
Liberty Funds Services, Inc.
P.O. Box 1722
Boston, MA 02105-1722
1-800-345-6611
Crabbe Huson Funds mails one
shareholder report to each shareholder
address. If you would like more than one
report, please call 1-800-426-3750 and
additional reports will be sent to you.
This report has been prepared for share-
holders of the Crabbe Huson Funds. This
report may also be used as sales literature
when preceded or accompanied by the
current prospectus which provides details
about sales charges, investment objectives
and operating policies of the Funds.
<PAGE> 108
[LIBERTY FUNDS LOGO] LIBERTY
--------------------------------------------
FUNDS
ALL-STAR * COLONIAL * CRABBE HUSON * NEWPORT * STEIN ROW ADVISOR
Liberty Funds Distributor, Inc. (c) 2000
One Financial Center, Boston, MA 02111-2621, 1-800-426-3750
www.libertyfunds.com
TRUSTEES
Tom Bleasdale
John V. Carberry
Lora S. Collins
James E. Grinnel
Richard W. Lowry
Salvatore Macera
William E. Mayer
James L. Moody, Jr.
John J. Neuhauser
Thomas E. Stitzel
Anne-Lee Verville
CHF-03/346B-0500 00/0971
