<PAGE> 1
GINTEL
GINTEL
GINTEL FUND
ANNUAL REPORT TO
SHAREHOLDERS
DECEMBER 31, 1995
<PAGE> 2
GINTEL FUND
The investment objective is to achieve capital appreciation through investing in
equities. The minimum initial investment in the Gintel Fund is $5,000, including
IRA's and Keogh's. There is no minimum on additional investments.
SUMMARY OF INVESTMENT RESULTS*
<TABLE>
<S> <C>
1995 31.0%
1994 -16.5%
1993 2.0%
1992 24.7%
1991 15.6%
1990 -6.7%
1989 23.8%
1988 29.4%
1987 -14.3%
1986 20.8%
1985 20.0%
1984 -2.6%
1983 34.3%
1982 34.1%
1981 (6/10/81-12/31/81) 7.6%
Average Annual Total
Return Since Inception 14.0%
</TABLE>
*Investment results are net of expenses, with dividends and
capital gains reinvested.
Past results offer no assurance as to future performance. The investment return
and principal value of an investment will fluctuate, so that an investor's
shares when redeemed may be worth more or less than their original cost. The
Fund's prospectus contains more complete information and should be read
carefully.
<PAGE> 3
January 22, 1996
Fellow Shareholders:
Gintel Fund's net asset value per share increased 31% in 1995, with dividends
reinvested. A number of our key holdings appreciated more than 50%, including
Federal National Mortgage, Capstead Mortgage, Chart Industries, Checkpoint
Systems, and Charter One Financial. During the fourth quarter we decided to lock
in part of our profits and defer taxable gains by selling some of our holdings
short "against-the-box". We closed out these positions in early 1996, generating
long-term capital gains exceeding nine million dollars. At present, the Fund
holds a healthy 21% uninvested cash reserve.
Our predictions at the beginning of 1995 turned out to be remarkably accurate.
We were positive in the face of inflationary concerns, forecasts of higher
interest rates, and fears of stock market overvaluations. The Dow Jones
Industrial Average gained almost 1300 points, while the bond markets experienced
strong price gains as well, with yields falling close to 15-year lows. Major
reasons for this excellent performance in the financial markets were continuing
economic growth, a 20% rise in corporate profits, minimal wage and price
inflation, an easing of interest rates, and the first serious attempt in
Washington to address the nation's fiscal problems and the way politicians have
managed our affairs.
Looking to the future, we see several crosscurrents which are likely to impact
stock prices in the months ahead:
- - Budget talks for the moment are stalemated and the government is being
financed on a month-to-month basis. We believe a solution, either
temporary or permanent, will be reached soon; nevertheless, the election
in November should be particularly controversial and may well become a
great ideological debate over what Americans should expect from their
federal government.
- - Weakness at the consumer retail level, where current recessionary forces
are being felt the most, has already precipitated a number of
bankruptcies. This could act as a restraint against wholesale price
pressures that otherwise would be building. We expect these conditions
to abate and retail sales to accelerate later in the year.
<PAGE> 4
- - Interest rates, particularly short-term rates, may trend lower if the
Federal Reserve Board moves to counteract recessionary forces which are
beginning to appear in the economy. We expect a reduction in short-term
rates of at least 25 to 50 basis points any time between now and the end
of summer.
- - Corporate profits, as a whole, can be expected to rise at a more
moderate rate in the current slow-growth, price-constrained environment
we foresee in the months ahead.
- - This year's market will be dominated by sector rotation in stock groups
rather than by the overall price rises which characterized the averages
in 1995.
We do not believe the major stock market indices will rise as sharply as they
did last year. Nevertheless, we are working to find individual stocks that will
produce a superior performance for us in 1996. We are searching for companies
selling at reasonable prices with strong balance sheets and good earnings
potential. We will continue to reevaluate all Fund holdings in this
ever-changing environment, while making new investments when opportunities
present themselves.
On December 28, 1995, a $0.944 per share dividend was paid to Gintel Fund
shareholders of record as of December 19, 1995, representing net investment
income and short-term capital gains of $0.177 per share and long-term capital
gains of $0.767 per share.
For those of our shareholders who also have money market accounts with us, the
UST Master Money Fund and Government Money Fund changed their names at year-end
to Excelsior Money Fund and Excelsior Government Money Fund. Both Funds continue
to be managed by U.S. Trust Company of New York.
We want to wish all shareholders a prosperous New Year and express our
appreciation for your continued support.
Cordially,
Robert M. Gintel Cecil A. Godman, III Edward F. Carroll
Chairman Investment Manager Investment Manager
<PAGE> 5
GINTEL FUND Statement of Net Assets As of December 31, 1995
<TABLE>
<CAPTION>
NUMBER
OF MARKET
SHARES COST** VALUE
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMON STOCKS
FOREST PRODUCTS - PAPER (9.7%)
150,000 Union Camp Corporation $6,750,336 $7,143,750
52,500 Weyerhaeuser Company 2,101,374 2,270,625
MORTGAGE INVESTMENTS (8.5%)
225,000 Capstead Mortgage Corporation 2,932,500 5,146,875
25,000 Federal National Mortage Association 834,712 3,103,125
COPPER PRODUCER (8.0%)
125,000 Phelps Dodge Corporation 7,623,777 7,781,250
SECURITY PROTECTION SYSTEMS (7.7%)
200,000 Checkpoint Systems, Inc. 1,567,464 7,475,000
DIVERSIFIED INDUSTRIES (7.3%)
700,000 Chart Industries, Inc. 3,205,420 5,337,500
25,000 Johnson Controls, Inc. 1,195,850 1,718,750
TEXTILE - APPAREL (4.5%)
665,000 Oneita Industries, Inc.+* 8,414,133 4,322,500
HEALTH CARE (4.0%)
50,000 Schering-Plough Corporation 540,155 2,737,500
75,000 GranCare, Inc.* 1,058,736 1,087,500
SAVINGS & LOAN (3.8%)
120,000 Charter One Financial Corporation 868,021 3,675,000
DIVERSIFIED CHEMICAL PRODUCER (3.6%)
50,000 E.I. du Pont de Nemours and Company 2,798,852 3,493,750
CONSTRUCTION & ENGINEERING (3.3%)
48,000 Fluor Corporation 2,223,496 3,168,000
MANUFACTURING (2.9%)
100,000 The Singer Co. N.V. 2,497,273 2,787,500
OILFIELD SERVICES (2.6%)
115,500 Newpark Resources, Inc.* 2,108,758 2,569,875
CONGLOMERATE (1.8%)
50,000 Tyco International LTD 1,278,937 1,781,250
BROADCAST EQUIPMENT (1.7%)
100,000 Vertex Communications Corporation* 1,550,000 1,687,500
SPECIALTY RETAILING(1.2%)
75,000 Price/Costco, Inc.* 1,011,187 1,143,750
</TABLE>
<PAGE> 6
<TABLE>
<CAPTION>
NUMBER
OF MARKET
SHARES COST** VALUE
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SOFT DRINKS (1.2%)
20,000 PepsiCo. Inc. 696,562 1,117,500
POWER TOOLS (1.1%)
30,000 The Black & Decker Corporation 750,260 1,057,500
ENVIRONMENTAL SERVICES (0.8%)
100,000 OHM Corporation* 693,749 737,500
FOOD EQUIPMENT (0.4%)
7,000 Premark International, Inc. 292,000 354,375
Miscellaneous Securities*** (4.1%) 3,516,405 3,981,687
- -----------------------------------------------------------------------------------------------
Total Common Stocks (78.2%) 56,509,957 75,679,562
- -----------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
- -----------------------------------------------------------------------------------------------
CASH EQUIVALENTS
2,044,000 Chase Securities, Inc. Repurchase Agreement
5.35% due 1/2/96(Collateralized by U.S.
Government Obligations) 2,044,000 2,044,000
- -----------------------------------------------------------------------------------------------
Total Cash Equivalents (2.1%) 2,044,000 2,044,000
- -----------------------------------------------------------------------------------------------
Total Investments (80.3%) $58,553,957 77,723,562
===========
Receivable from short sales (18.4%) 17,798,554
Other assets net of liabilities (1.3%) 1,216,741
- -----------------------------------------------------------------------------------------------
Net Assets Applicable to
Outstanding Shares (100.0%) $96,738,857
===============================================================================================
Net asset value per share-based on 6,295,777 shares of
beneficial interest (offering and redemption price) $15.37
===============================================================================================
</TABLE>
* Non-income producing investments
** Cost basis for Federal income tax purposes
*** Includes 19 investments, some of which are non-income producing investments.
+ Robert Gintel is Chairman of the Board of Oneita Industries and owns 16% of
its common stock. As a result, Oneita may be deemed to be an affiliate of
the Fund.
The accompanying notes to financial statements are an integral part hereof.
<PAGE> 7
GINTEL FUND Statement of Operations Year Ended December 31, 1995
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends $ 1,811,480
Interest 197,749
------------
Total investment income 2,009,229
EXPENSES:
Administrative services fee (Note D) $ 1,107,572
Investment advisory fee (Note C) 928,954
Trustees' fees 27,453
State taxes 5,276
------------
Total expenses 2,069,255
------------
NET INVESTMENT LOSS (60,026)
NET REALIZED GAIN ON INVESTMENTS 5,682,632
NET INCREASE IN UNREALIZED APPRECIATION OF INVESTMENTS 19,306,875
------------
NET GAIN ON INVESTMENTS 24,989,507
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 24,929,481
============
</TABLE>
The accompanying notes to financial statements are an integral part hereof.
<PAGE> 8
GINTEL FUND Statements of Changes in Net Assets Year Ended December 31
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (60,026) $ 329,828
Net realized gain on investments 5,682,632 1,062,638
Net increase (decrease) in unrealized appreciation
of investments 19,306,875 (21,596,352)
------------- -------------
Net increase (decrease) in net assets from
operations 24,929,481 (20,203,886)
DISTRIBUTIONS TO SHAREHOLDERS:
Investment income (51,107) (321,331)
Net realized gains from investment (5,689,197) (829,794)
------------- -------------
Net decrease from distributions (5,740,304) (1,151,125)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares issued 1,577,646 3,780,624
Reinvestment of dividends 3,363,935 723,070
Cost of shares repurchased (15,669,171) (30,981,707)
------------- -------------
Net decrease from capital
share transactions (10,727,590) (26,478,013)
Total Increase (Decrease) 8,461,587 (47,833,024)
Net Assets - Beginning of Year 88,277,270 136,110,294
------------- -------------
Net Assets - End of Year $ 96,738,857 $ 88,277,270
============= =============
NET ASSETS CONSIST OF:
Capital Stock $ 78,314,870 $ 89,042,460
Undistributed net investment losses (266,292) (155,159)
Undistributed net realized gains
from security transactions 54,050 60,615
Unrealized appreciation (depreciation) on investments 18,636,229 (670,646)
------------- -------------
$ 96,738,857 $ 88,277,270
============= =============
</TABLE>
The accompanying notes to financial statements are an integral part hereof.
<PAGE> 9
GINTEL FUND Condensed Financial Information
(Per Share Income and Capital Changes*) Year Ended December 31
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Year $ 12.46 $ 15.11 $ 16.45 $ 13.48 $ 12.75
Income from
Investment Operations
Net investment income (loss) (.01) .04 (.06) .09 .32
Net realized and unrealized
gain (loss) on securities 3.86 (2.53) .37 3.23 1.66
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Income 3.85 (2.49) .31 3.32 1.98
- --------------------------------------------------------------------------------------------------------------------------------
Less: Distributions
Net investment income .01 .04 -- .10 .31
Capital gains .93 .12 1.65 .25 .94
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions .94 .16 1.65 .35 1.25
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Year $ 15.37 $ 12.46 $ 15.11 $ 16.45 $ 13.48
================================================================================================================================
Total Return 31.0% -16.5% 2.0% 24.7% 15.6%
- --------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of year $96,738,857 $88,277,270 $ 136,110,294 $ 164,620,218 $ 77,408,444
Ratio of operating expenses to
average net assets (Note D) 2.3%** 2.4%** 2.2%** 1.7%** 1.4%
Ratio of net investment
income (loss) to average net assets (.1%) .3% (.3%) .9% 1.9%
Portfolio turnover rate 55.4% 69.6% 50.8% 56.0% 66.3%
Shares outstanding, end of year 6,295,777 7,085,466 9,008,802 10,009,980 5,741,424
</TABLE>
* The above per share information is based upon a daily average of shares
outstanding, which has been restated to reflect the 5.241835/1 split on
September 25, 1992
** The Fund's expense ratio includes brokerage commissions on portfolio
transactions paid for under the Fund's Administrative Services fee, and,
therefore, may appear higher than those of other mutual funds as well as for
the Fund in prior years. Other mutual funds do not include brokerage
commissions in their operating expenses, but instead add them to the cost of
securities purchased or deduct them from the proceeds of securities sold.
The accompanying notes to financial statements are an integral part hereof.
<PAGE> 10
GINTEL FUND Notes to Financial Statements December 31, 1995
(NOTE A) -- ORGANIZATION:
The Gintel Fund (the "Fund") is a Massachusetts business trust formed under the
laws of the Commonwealth of Massachusetts with authority to issue an unlimited
number of shares of beneficial interest.
(NOTE B) -- SIGNIFICANT ACCOUNTING POLICIES:
1. Security Valuation:
Investments in securities are valued at the last reported sales price on the
last business day of the period, or in the absence of a recorded sale, at the
mean of the closing bid and asked price on that date. Short-term investments are
valued at cost which approximates market value.
2. Federal Income Taxes:
It is the Fund's policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute
substantially all of its taxable income and long-term gains to its shareholders.
Therefore, only a nominal Federal income tax provision is required.
3. Other:
As is common in the industry, security transactions are accounted for on the
trade date. Dividend income and distributions to shareholders are recorded on
the ex-dividend date.
Realized gain or loss on security transactions is determined on the basis of
first-in, first-out or specific identification.
(NOTE C) -- INVESTMENT ADVISORY AGREEMENT:
The Fund has entered into an Investment Advisory Agreement with Gintel Equity
Management, Inc., a related party, which provides for an annual fee of 1% to be
paid quarterly, based on the daily value of the Fund's net assets during the
preceding quarter. The fee will be reduced for any fiscal year, if the Fund's
expenses, as defined, exceed certain limitations.
(NOTE D) -- ADMINISTRATIVE SERVICES AGREEMENT:
The Fund has entered into an Administrative Services Agreement which provides
that in consideration for the services provided by Gintel & Co., the Fund's
Distributor and a related party, and the payment by the Distributor of
substantially all of the Fund's expenses, including but not limited to brokerage
commissions and operating expenses (but excluding the Investment Advisor's fees,
the fees paid to non-interested Trustees, certain transaction costs, interest,
taxes and extraordinary expenses), the Distributor will receive a fee payable at
the beginning of each quarter based on average daily net assets during the
preceding quarter, at an annual rate of 1.25% of the first $50 million of the
average daily net assets of the Fund, 1.125% of the next $50 million of the
average daily net assets and 1.0% of the average daily net assets in excess of
$100 million.
<PAGE> 11
GINTEL FUND Notes to Financial Statements -- continued December 31, 1995
(NOTE E) -- LINE OF CREDIT:
The Fund has a bank line of credit of $15,000,000. Interest is payable at prime.
Loans are collateralized by securities owned by the Fund. At December 31, 1995
the Fund had no outstanding borrowings.
(NOTE F) -- OTHER MATTERS:
<TABLE>
<S> <C>
1. Investments
Unrealized appreciation at December 31, 1995 $34,420,670
Unrealized depreciation at December 31, 1995 (6,111,603)
-----------
$28,309,067
===========
</TABLE>
The above totals include a net unrealized gain of approximately $9,139,000 on
securities sold short which have been offset against long positions.
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<S> <C>
Purchases of securities other than short-term investments $47,225,369
Sales of securities other than short-term investments $56,654,292
</TABLE>
2. Capital Stock: (in shares)
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994
----------------- -----------------
<S> <C> <C>
Shares issued 115,098 268,160
Shares reinvested 220,009 58,265
Shares repurchased (1,124,796) (2,249,761)
----------------- -----------------
Net decrease (789,689) (1,923,336)
================= =================
</TABLE>
<PAGE> 12
REPORT OF INDEPENDENT AUDITORS
Board of Trustees and Shareholders
Gintel Fund
Greenwich, Connecticut
We have audited the statement of net assets of the Gintel Fund as of December
31, 1995, and the related statement of operations for the year then ended,
statements of changes in net assets for each of the years in the two-year period
then ended, and the condensed financial information for each of the years in the
five-year period then ended. These financial statements and condensed financial
information are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and condensed financial
information based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and condensed
financial information are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of December 31, 1995, with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and condensed financial information
enumerated above present fairly, in all material respects, the financial
position of Gintel Fund as of December 31, 1995, the results of its operations
for the year then ended, the changes in its net assets for each of the years in
the two-year period then ended, and the condensed financial information for each
of the years in the five-year period then ended, in conformity with generally
accepted accounting principles.
Richard A. Eisner & Company, LLP
New York, New York
January 22, 1996
<PAGE> 13
INVESTMENT STAFF
ROBERT M. GINTEL
Robert Gintel has spent his entire business career in the investment
industry with more than 40 years of experience as a professional investor. Mr.
Gintel is Chairman and Chief Executive Officer of Gintel Equity Management, Inc.
He is also Senior Partner and founder of Gintel & Co., a member of the New York
Stock Exchange and associate member of the American Stock Exchange, and Chairman
of the Board and Chief Executive Officer of Gintel Fund and Gintel ERISA Fund.
He holds a B.A. degree from Columbia College and an M.B.A. from the Harvard
Business School. Mr. Gintel has served on the Board of Directors of several New
York Stock Exchange listed corporations and is currently Chairman of the Board
of Oneita Industries, Vice Chairman of the Board of XTRA Corporation, and a
Director of Amtech Corporation. Mr. Gintel has lectured and written articles on
investments and has appeared on Wall Street Week and other television and radio
programs.
CECIL A. GODMAN, III
Mr. Godman joined the Gintel organization in 1985 after spending two
years as a securities analyst with First Tennessee Investment Management, Inc.,
a $1.8 billion asset management subsidiary of First Tennessee National
Corporation. He is a General Partner of Gintel & Co. and a director of Gintel
Equity Management, Inc. Mr. Godman received his B.A. in Business Administration
and Economics from Rhodes College in Memphis in 1982.
EDWARD F. CARROLL
Mr. Carroll joined Gintel Equity Management, Inc. in 1983 and is a
General Partner of Gintel & Co. Previously, Mr. Carroll had his own consulting
firm specializing in global energy issues and was on the staff of the Ford
Foundation, where he was directly responsible for all energy-related
investments. Mr. Carroll's 35-year career includes experience as an analyst with
the Wall Street firms, Halle & Steiglitz, Henry Hentz & Company, and E.F.
Hutton. He holds a B.G.S. degree from the University of Connecticut.
TIMOTHY J. MCSWEENEY
Mr. McSweeney joined Gintel Equity Management, Inc. in 1995 as a
securities analyst. He received his B.A. in economics from Clark University and
his M.B.A. from Northeastern University.
<PAGE> 14
GINTEL FUND Trustees and Officers
- --------------------------------------------------------------------------------
Robert M. Gintel Chairman, Trustee, and Chief Executive Officer
Chairman and Chief Executive Officer, Gintel Equity
Management, Inc.; Senior Partner, Gintel & Co. Limited
Partnership; Chairman and Director, Oneita Industries;
Vice Chairman and Director, XTRA Corporation; Director,
Amtech Corporation; Chairman, Trustee and Chief
Executive Officer, Gintel ERISA Fund.
Thomas H. Lenagh Trustee
Financial Consultant; formerly Chairman and Chief
Executive Officer of Greiner Engineering Co.; Director,
Adams Express Co., USLife Corp., ICN Biomedics, Inc.,
SCI Systems, Inc., Irvine Sensors Corp., CML Inc.,
Clemente Global, Rexhall Inc.; Trustee, Gintel ERISA
Fund.
Francis J. Palamara Trustee
Business Consultant; previously Director and Executive
Vice President of ARA Services, Inc.; formerly Executive
Vice President and Chief Operating Officer of the New
York Stock Exchange, Inc.; Director, Glenmede Fund, XTRA
Corporation, Central Tractor Farm & Country; Trustee,
Gintel ERISA Fund.
Russel R. Taylor Trustee
Associate Professor of Management and Marketing,
Director of H.W. Taylor Institute of Entrepreneurial
Studies, College of New Rochelle; Founder of Russel
Taylor, Inc.; Trustee, Gintel ERISA Fund.
Stephen G. Stavrides Trustee, President, and Treasurer
President, Gintel Equity Management, Inc.; General
Partner and Chief Operating Officer, Gintel & Co.
Limited Partnership; Trustee, President, and Treasurer,
Gintel ERISA Fund.
Donna K. Grippe Secretary and Assistant Treasurer
INVESTMENT ADVISOR GINTEL GROUP
Gintel Equity Management, Inc. Chase Global Funds
Services Company
6 Greenwich Office Park P. O. Box 2798
Greenwich, CT 06831-5197 Boston, MA 02208-2798
203 622-6400 800 344-3092
