THE NORTH CAROLINA
CAPITAL MANAGEMENT TRUST
Cash Portfolio
Term Portfolio
Semiannual
Report
December 31, 1994
NORTH CAROLINA
CAPITAL
MANAGEMENT
TRUST
CASH PORTFOLIO
NORTH CAROLINA
CAPITAL
MANAGEMENT
TRUST
TERM PORTFOLIO
PERFORMANCE UPDATE
FOR THE PERIOD ENDED DECEMBER 31, 1994
Annualized net yield 5.56% 6.79%
(7 day)
(30 day)
Six-month dividends per share 2.33(cents) 22.11(cents)
Six-month annualized dividend rate* 4.62% 4.47%
Six-month cumulative total return** 2.35% 1.85%
Five-year cumulative total return** 26.93% 30.61%
Ten-year cumulative total return** 82.72% n/a
Life of fund cumulative total return** 126.06% 59.60%
One-year total return** 4.02% 2.73%
Five-year average annual total return** 4.88% 5.49%
Ten-year average annual total return** 6.21% n/a
Life of fund average annual total return** 6.83% 6.18%
* The dividend rate reflects actual dividends paid during the period. It
is based on an average share price of $9.81 for Term Portfolio.
** TOTAL RETURNS include changes in share price (except for Cash
Portfolio) and reinvestment of dividends and capital gains, if any. AVERAGE
ANNUAL TOTAL RETURNS for more than one year assume a steady compounded rate
of return and are not the funds' year-by-year results, which fluctuated
over the periods shown. LIFE OF FUND figures are from commencement of
operations, September 2, 1982 for Cash Portfolio and March 19, 1987 for
Term Portfolio, to the period listed above. If the adviser had not
reimbursed certain fund expenses during the 5 and 10 year and Life of fund
periods, figures would have been lower.
ALL FUND PERFORMANCE NUMBERS ARE HISTORICAL; THE FUNDS' SHARE PRICE
(EXCEPT FOR CASH PORTFOLIO), YIELD AND RETURN WILL VARY AND YOU MAY HAVE A
GAIN OR LOSS WHEN YOU REDEEM OR SELL YOUR SHARES. AN INVESTMENT IN CASH
PORTFOLIO IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT. CASH
PORTFOLIO CANNOT ASSURE THAT IT WILL MAINTAIN A STABLE $1.00 SHARE PRICE.
$10,000 OVER LIFE OF FUND
NCCMT-Term PortfolioSB 12 Month Treasury
03/31/87 10000.00 10000.00
04/30/87 9952.13 9811.00
05/31/87 9987.11 9762.93
06/30/87 10075.11 9872.27
07/31/87 10117.21 9835.74
08/31/87 10150.09 9792.47
09/30/87 10173.02 9600.53
10/31/87 10313.87 9975.91
11/30/87 10350.32 10018.81
12/31/87 10431.71 10133.03
01/31/88 10534.02 10486.67
02/29/88 10598.65 10595.73
03/31/88 10634.17 10481.30
04/30/88 10679.05 10405.83
05/31/88 10704.61 10357.96
06/30/88 10782.52 10571.34
07/31/88 10822.65 10498.40
08/31/88 10875.06 10515.19
09/30/88 10959.87 10744.42
10/31/88 11046.86 10936.75
11/30/88 11065.43 10812.07
12/31/88 11133.28 10848.83
01/31/89 11213.20 10997.46
02/28/89 11266.85 10906.18
03/31/89 11329.37 10975.98
04/30/89 11448.82 11182.33
05/31/89 11559.37 11468.60
06/30/89 11692.27 11867.70
07/31/89 11814.55 12119.30
08/31/89 11839.65 11907.21
09/30/89 11912.24 11960.79
10/31/89 12036.32 12278.95
11/30/89 12120.85 12393.15
12/31/89 12194.79 12409.26
01/31/90 12244.05 12230.56
02/28/90 12309.56 12237.90
03/31/90 12381.65 12248.92
04/30/90 12438.06 12142.35
05/31/90 12561.64 12471.41
06/30/90 12644.78 12669.70
07/31/90 12770.27 12835.68
08/31/90 12830.76 12645.71
09/30/90 12914.73 12778.49
10/31/90 13028.08 12990.61
11/30/90 13138.09 13269.91
12/31/90 13265.16 13480.90
01/31/91 13365.86 13622.45
02/28/91 13458.28 13675.58
03/31/91 13526.84 13750.79
04/30/91 13632.00 13913.05
05/31/91 13697.56 13960.36
06/30/91 13761.50 13950.59
07/31/91 13841.54 14124.97
08/31/91 13962.49 14437.13
09/30/91 14051.41 14750.41
10/31/91 14140.63 14868.42
11/30/91 14241.78 15024.54
12/31/91 14387.14 15544.39
01/31/92 14423.24 15297.23
02/29/92 14467.04 15358.42
03/31/92 14472.28 15263.20
04/30/92 14579.32 15373.09
05/31/92 14653.76 15637.51
06/30/92 14704.99 15867.38
07/31/92 14749.10 16262.48
08/31/92 14837.15 16431.61
09/30/92 14924.18 16663.29
10/31/92 14821.30 16420.01
11/30/92 14776.80 16385.53
12/31/92 14899.07 16664.08
01/31/93 15052.39 17039.02
02/28/93 15109.14 17369.58
03/31/93 15149.79 17416.48
04/30/93 15202.86 17568.00
05/31/93 15209.58 17538.14
06/30/93 15260.74 17930.99
07/31/93 15304.90 18036.78
08/31/93 15360.88 18435.40
09/30/93 15399.15 18518.36
10/31/93 15440.24 18564.65
11/30/93 15464.70 18360.44
12/31/93 15504.63 18443.06
01/31/94 15560.38 18695.73
02/28/94 15534.75 18306.86
03/31/94 15545.22 17883.97
04/30/94 15538.50 17748.05
05/31/94 15580.59 17733.86
06/30/94 15637.60 17700.16
07/31/94 15711.13 18004.60
08/31/94 15756.08 18011.81
09/30/94 15806.12 17763.24
10/31/94 15858.67 17747.26
11/30/94 15865.68 17704.66
12/30/94 15927.15 17823.28
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in North Carolina
Term Portfolio on March 31, 1987, shortly after the fund started. As the
chart shows, by December 31, 1994, the value of your investment with
dividends and capital gain distributions reinvested, would have grown to
$15,927 - a 59.27% increase on your initial investment. For comparison,
look at how the Salomon Brothers 12-Month Treasury Bill Index did over the
same period*. With dividends reinvested, the same $10,000 investment would
have grown to $17,823 - a 78.23% increase.
* The $10,000 investment in the Salomon Brothers 12-Month Treasury Bill
Index was made on March 31, 1987, the month end closest to Term Portfolio's
commencement of operations date.
AN INTERVIEW WITH
ROBERT DUBY: PORTFOLIO MANAGER OF
NORTH CAROLINA CAPITAL MANAGEMENT TRUST:
TERM PORTFOLIO
&
BURNELL STEHMAN: PORTFOLIO MANAGER OF
NORTH CAROLINA CAPITAL MANAGEMENT TRUST:
CASH PORTFOLIO
Q: BOB, HOW DID THE TERM PORTFOLIO PERFORM?
A: MR. DUBY: The fund's total return for the six months ended December 31,
1994 was 1.85%, the same as the return of the Salomon Brothers 12-month
Treasury Bill Index for the same period. For the year, the fund returned
2.73% versus 2.63% for
the Index. The fund's slightly higher performance can be attributed to the
fact that the fund's average maturity was much shorter than the Index
during the past six months. Returns on many bond funds were negative during
that period, but fortunately, maturities on most of the fund's investments
were kept short enough to keep
us in positive territory.
Q: HOW DID RISING INTEREST RATES INFLUENCE THE PORTFOLIO'S PERFORMANCE?
A: MR. DUBY: Short-term interest rates have increased dramatically over the
past six months, with the yield on one-year Treasury bills rising from
5.49% on June 30, 1994, to 7.16% on December 31. At the same time, the
difference in yield - or the yield spread - between the one-year bill and
30-year Treasury bond was 2.11%
at the beginning of July and only 0.72% at the end of December. When
spreads between short- and long-term bonds narrow like this, the "yield
curve" is said to be flattening. I expect this trend
to continue until short-term rates eventually become higher than long-term
rates.
Q: HOW DID YOU MAXIMIZE RETURNS WHILE RATES WERE RISING?
A: MR. DUBY: I kept the fund's average maturity much shorter than the Index
during most of the past six months as interest rates rose. Investments were
concentrated in one- and two-month commercial
paper and agency discount notes. The average maturity was close to six
months for most of this period, and only recently was increased closer to
the average maturity of the Index, which is one year. By December 31, 1994
the average maturity of the fund was 1.05 years.
Q: WHAT DO YOU SEE HAPPENING IN THE NEXT SIX MONTHS?
A: MR. DUBY: I agree with current thinking which anticipates the federal
funds rate - the rate banks charge each other for overnight loans - to
increase by 1%-1.5% by mid-1995. I expect the economy will continue to show
strength, albeit at a slower pace than the fourth quarter of 1994, and
inflation will remain relatively tame throughout the period. I believe the
yield curve will continue to flatten and eventually may become inverted.
Outside forces, such as the situation in Orange County, California, will
continue to exert temporary influence on interest rates, but
I think the general direction will be for higher rates as we move through
1995.
Q: LET'S TURN TO THE CASH PORTFOLIO. BURNIE, HOW HAS IT PERFORMED?
A: MR. STEHMAN: The fund returned 2.35% for the six-months ended December
31, 1994, and 4.02% for the year. That compares favorably to the average
taxable money market fund, which returned 2.19% and 3.75% for the same time
periods, respectively, according to IBC/Donoghue. The fund's seven-day
yield on December 31, 1994, was 5.56%, compared to 4.02% six months ago.
Q: HOW DID YOU ADJUST THE FUND'S HOLDING IN A CONTINUING RISING RATE
ENVIRONMENT?
A: MR. STEHMAN: When the sixth Fed rate hike of the year came in
mid-November - three-quarters of a percentage point - it was more
aggressive than most Fed watchers had anticipated. It was the largest
single move since 1981, and it became very clear that the Fed was trying to
put the brakes on the robust economy and keep inflation under control. In
anticipation of the increase, I had shortened the fund's average maturity.
As a result, when the fund's shorter-term instruments matured, I was able
to lock in higher yields by slightly lengthening the maturity. I began
limited buying of some selected longer maturities where yields already
reflected the increase in rates. This way, I was able to lock in higher
return while keeping the fund's average maturity short enough to maintain
flexibility.
Q: HOW DO YOU STRIKE A BALANCE BETWEEN LONGER- AND SHORTER-TERM MATURITIES?
A: MR. STEHMAN: Generally, I've kept maturities short but have also managed
to maximize returns by positioning a small portion of the portfolio in two-
to three-month
maturities. However, with interest on
overnight investments at about 5.5%,
I've been able to keep the fund's yield
competitive by maintaining a fairly
conservative investment posture.
Q: WHAT'S AHEAD FOR THE NEXT SIX MONTHS?
A: MR. STEHMAN: I agree with Bob that we'll most likely see higher
short-term interest rates by mid-summer. In fact, I've already shortened
the fund's average maturity to take advantage of the potential hike in
rates by the Fed.
If short-term rates continue to increase, I'll likely become more
aggressive by extending the duration of the portfolio
so the fund can benefit from the higher yields that I expect will become
available in the marketplace.
"AVERAGE MATURITY
IS ALWAYS THE
QUESTION WHEN IT
COMES TO EVALUATING
MONEY MARKET FUNDS.
CONVENTIONAL
WISDOM SAYS THAT
MONEY MARKET
MANAGERS EXTEND
MATURITIES IN THEIR
PORTFOLIOS WHEN
THEY'RE EXPECTING
RATES TO DROP, AND
SHORTEN THEM IN A
RISING RATE
ENVIRONMENT. BUT THE
KEY QUESTION REALLY
IS: HOW DID YOU GET
THERE? IS THE FUND
80% INVESTED IN
OVERNIGHTS AND 20%
IN 6-MONTH
MATURITIES? IT'S NOT
JUST WHAT THE
AVERAGE MATURITY IS,
BUT HOW IT IS
COMPRISED."
- - BURNIE
STEHMAN
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST -
CASH PORTFOLIO
INVESTMENTS/DECEMBER 31, 1994 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
ANNUALIZED
DUE YIELD AT TIME PRINCIPAL VALUE
DATE OF PURCHASE AMOUNT (NOTE 1)
BANKERS' ACCEPTANCES - 0.7%
NationsBank of Florida
1/6/95 6.04% $ 4,500,000 $ 4,496,243
NationsBank of Texas
1/17/95 6.03 6,500,000 6,482,666
TOTAL BANKERS' ACCEPTANCES 10,978,909
COMMERCIAL PAPER (dagger) - 78.1%
AT&T Capital Corp.
1/6/95 6.02 10,000,000 9,991,667
1/10/95 5.51 20,000,000 19,972,750
AVCO Financial Services, Inc.
2/2/95 5.96 15,000,000 14,921,333
2/9/95 6.17 5,000,000 4,966,904
2/10/95 6.17 5,000,000 4,966,056
2/13/95 6.17 10,000,000 9,927,020
American Express Credit Corp.
1/3/95 5.75 25,000,000 24,992,014
American General Finance Corp.
1/11/95 5.94 10,000,000 9,983,611
1/20/95 5.98 20,000,000 19,937,194
1/26/95 5.58 5,000,000 4,980,903
American Telephone & Telegraph Co.
1/13/95 6.02 1,000,000 998,000
3/13/95 6.35 15,000,000 14,815,104
Associates Corp. of North America
1/18/95 6.10 15,000,000 14,957,146
1/19/95 6.08 5,000,000 4,984,875
1/23/95 6.10 10,000,000 9,963,028
2/6/95 6.13 10,000,000 9,939,300
Bankers Trust Corp.
1/30/95 5.49 5,000,000 4,978,250
1/30/95 5.50 15,000,000 14,934,568
1/31/95 5.49 20,000,000 19,910,000
2/7/95 5.88 12,250,000 12,176,977
2/14/95 5.74 15,000,000 14,896,417
CASH PORTFOLIO
INVESTMENTS/DECEMBER 31, 1994 (UNAUDITED) - CONTINUED
ANNUALIZED
DUE YIELD AT TIME PRINCIPAL VALUE
DATE OF PURCHASE AMOUNT (NOTE 1)
COMMERCIAL PAPER (dagger) - CONTINUED
Bear Stearns Cos., Inc.
1/30/95 5.69% $ 20,000,000 $ 19,909,536
2/6/95 5.97 6,000,000 5,964,600
BellAtlantic Financial Services
1/3/95 6.05 7,200,000 7,197,592
1/13/95 5.72 25,000,000 24,952,750
Beneficial Corp.
1/18/95 6.14 10,000,000 9,971,194
1/20/95 5.82 15,000,000 14,954,321
Bank of New York
1/24/95 6.03 15,000,000 14,942,500
CIESCO, L.P.
1/9/95 5.51 15,000,000 14,981,833
1/13/95 5.67 15,000,000 14,971,900
2/21/95 6.01 15,000,000 14,873,563
CIT Group Holdings, Inc.
1/3/95 6.05 24,000,000 23,991,933
1/18/95 5.80 25,000,000 24,932,118
1/27/95 6.17 15,000,000 14,933,700
1/30/95 6.03 10,000,000 9,951,908
Commercial Credit Co.
1/10/95 5.51 15,000,000 14,979,562
1/27/95 5.58 20,000,000 19,920,556
CoreStates Capital Corp.
1/9/95 6.14 (a) 10,000,000 10,000,000
1/18/95 6.14 (a) 20,000,000 20,000,000
Corporate Asset Funding Co., Inc.
1/4/95 6.05 7,400,000 7,396,289
Dean Witter, Discover & Co.
1/5/95 5.82 10,000,000 9,993,578
1/6/95 5.82 10,000,000 9,991,972
1/11/95 5.83 10,000,000 9,983,945
1/12/95 5.83 10,000,000 9,982,339
1/31/95 5.58 15,000,000 14,931,249
ANNUALIZED
DUE YIELD AT TIME PRINCIPAL VALUE
DATE OF PURCHASE AMOUNT (NOTE 1)
COMMERCIAL PAPER (dagger) - CONTINUED
Eaton Corp.
1/3/95 6.05% $ 9,470,000 $ 9,466,817
Ford Motor Credit Corp.
1/23/95 5.86 14,000,000 13,950,378
1/26/95 6.10 10,000,000 9,957,986
General Electric Capital Corp.
1/3/95 6.13 (a) 15,000,000 15,000,000
1/19/95 5.13 10,000,000 9,974,900
1/26/95 5.27 10,000,000 9,964,445
2/8/95 6.09 10,000,000 9,936,350
Georgia Power Co.
1/12/95 5.99 9,000,000 8,983,583
Golden Peanut Co.
2/6/95 5.73 2,000,000 1,988,700
2/7/95 5.78 4,500,000 4,473,638
Goldman Sachs Group, L.P. (The)
1/24/95 5.96 10,000,000 9,962,146
H.J. Heinz Co.
2/9/95 5.95 5,831,000 5,793,730
IBM Credit Corp.
1/5/95 6.07 10,000,000 9,993,278
1/23/95 6.05 25,000,000 24,908,334
ITT Hartford Group, Inc.
1/12/95 6.03 15,000,000 14,972,500
J.C. Penny Funding Corp.
1/4/95 5.91 10,493,000 10,487,840
1/11/95 5.96 5,600,000 5,590,745
1/17/95 5.83 25,231,000 25,166,184
John Deere Capital Corp.
5/1/95 5.87 25,000,000 24,525,000
Merrill Lynch & Co., Inc.
5/16/95 6.19 5,000,000 4,887,500
Monsanto Co.
1/27/95 6.01 25,000,000 24,892,027
2/23/95 6.06 2,800,000 2,775,267
CASH PORTFOLIO
INVESTMENTS/DECEMBER 31, 1994 (UNAUDITED) - CONTINUED
ANNUALIZED
DUE YIELD AT TIME PRINCIPAL VALUE
DATE OF PURCHASE AMOUNT (NOTE 1)
COMMERCIAL PAPER (dagger) - CONTINUED
Morgan (J.P.) & Co.
1/6/95 5.91% $ 3,800,000 $ 3,796,887
Morgan Stanley Group, Inc.
1/26/95 5.60 10,000,000 9,961,666
2/13/95 6.26 5,000,000 4,963,032
3/13/95 6.38 5,000,000 4,938,073
NationsBank Corp.
2/17/95 6.16 25,000,000 24,800,903
3/6/95 6.19 25,000,000 24,736,285
New Center Asset Trust
1/13/95 6.18 21,000,000 20,956,950
1/30/95 6.06 5,000,000 4,975,833
2/13/95 6.24 12,000,000 11,911,420
Norfolk Southern Corp.
2/3/95 6.14 10,700,000 10,640,365
Northern States Power Co.
1/10/95 6.04 2,415,000 2,411,365
Norwest Financial
1/30/95 6.18 10,000,000 9,950,619
PHH Corp.
1/6/95 6.05 2,900,000 2,897,575
1/13/95 6.03 20,000,000 19,960,000
1/23/95 5.93 1,200,000 1,195,674
Pepsico
1/6/95 6.01 900,000 899,250
1/10/95 6.01 1,300,000 1,298,050
1/18/95 6.02 1,000,000 997,167
Preferred Receivables Funding Corp.
1/17/95 6.13 3,240,000 3,231,216
1/19/95 6.07 11,400,000 11,365,515
1/19/95 6.14 5,000,000 4,984,749
1/20/95 5.97 6,155,000 6,135,671
1/25/95 5.98 4,475,000 4,457,249
1/25/95 6.03 2,100,000 2,091,600
1/25/95 6.14 7,215,000 7,185,659
ANNUALIZED
DUE YIELD AT TIME PRINCIPAL VALUE
DATE OF PURCHASE AMOUNT (NOTE 1)
COMMERCIAL PAPER (dagger) - CONTINUED
Prudential Home Mortgage Co.
2/3/95 6.15% $ 5,000,000 $ 4,972,042
Prudential Insurance Co. of America
2/3/95 6.12 5,500,000 5,469,397
Republic New York Corp.
1/18/95 6.11 14,000,000 13,959,937
Seagram & Sons, Joseph E. (Inc.)
2/2/95 5.77 9,070,000 9,024,046
2/23/95 5.93 10,000,000 9,913,875
Smith Barney, Inc.
1/24/95 6.01 10,000,000 9,961,922
1/25/95 6.02 5,000,000 4,980,133
Student Loan Corporation
1/3/95 6.05 8,000,000 7,997,316
1/25/95 6.10 10,000,000 9,959,667
Texaco Inc.
2/7/95 5.70 25,000,000 24,855,597
Transamerica Corp.
1/19/95 5.98 15,506,000 15,460,025
2/10/95 5.78 20,000,000 19,873,334
Union Pacific Corp.
1/10/95 6.16 5,000,000 4,992,344
1/24/95 6.21 7,000,000 6,972,496
TOTAL COMMERCIAL PAPER 1,197,688,307
CASH PORTFOLIO
INVESTMENTS/DECEMBER 31, 1994 (UNAUDITED) - CONTINUED
ANNUALIZED
DUE YIELD AT TIME PRINCIPAL VALUE
DATE OF PURCHASE AMOUNT (NOTE 1)
FEDERAL AGENCIES - 13.9%
Federal Farm Credit Bank - Discount Notes - 1.0%
5/2/95 5.83% $ 10,000,000 $ 9,809,762
5/15/95 6.02 6,000,000 5,869,573
15,679,335
Federal Home Loan Bank - Discount Notes - 0.6%
3/15/95 6.22 10,000,000 9,875,697
Federal Home Loan Mortgage Corp. - Discount Notes - 8.4%
1/17/95 5.04 14,720,000 14,687,681
2/2/95 5.67 30,000,000 29,850,667
2/2/95 6.05 5,000,000 4,973,333
2/2/95 6.08 15,000,000 14,919,733
2/6/95 5.67 15,000,000 14,916,000
2/10/95 6.07 11,000,000 10,926,421
2/16/95 5.70 15,000,000 14,892,283
2/16/95 5.78 18,219,000 18,086,305
2/16/95 6.10 5,000,000 4,961,411
128,213,834
Federal National Mortgage Assoc. - Agency Coupons - 1.6%
1/3/95 6.10 (a) 25,000,000 25,000,000
Federal National Mortgage Assoc. - Discount Notes - 2.3%
2/17/95 5.78 15,000,000 14,888,375
2/17/95 6.11 5,000,000 4,960,572
3/6/95 5.51 15,000,000 14,856,000
34,704,947
TOTAL FEDERAL AGENCIES 213,473,813
MATURITY VALUE
AMOUNT (NOTE 1)
REPURCHASE AGREEMENTS - 7.3%
In a joint trading account
(U.S. Treasury Obligations)
dated 12/30/94 due 1/3/95
At 5.77% $ 111,229,277 $ 111,158,000
TOTAL COST OF INVESTMENTS - 100% $ 1,533,299,029
Total Cost for Income Tax Purposes - $1,533,299,029
(dagger) Cash Portfolio only purchases commercial paper with the highest
possible rating from at least one nationally recognized rating service. A
substantial portion of Cash Portfolio's investments are in commercial paper
of banks, finance companies and companies in the securities industry.
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the next interest rate reset date or when applicable,
the final maturity date.
INCOME TAX INFORMATION:
At June 30, 1994, Cash Portfolio had a capital loss carryforward of
approximately $103,000 of which $43,000 and $60,000 will expire on June 30,
2001 and 2002, respectively.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST -
CASH PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1994 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS
Investment in securities, at value (including $ 1,533,299,029
repurchase agreements of $111,158,000) -
See accompanying schedule
Interest receivable 367,119
Total assets 1,533,666,148
LIABILITIES
Payable for investments purchased $ 24,736,285
Dividends payable 787,964
Accrued management fee 468,120
Total liabilities 25,992,369
NET ASSETS $ 1,507,673,779
Net Assets consist of:
Paid in capital $ 1,507,757,768
Accumulated net realized gain (loss) (83,989)
on investments
NET ASSETS, for 1,507,757,768 shares $ 1,507,673,779
outstanding
NET ASSET VALUE, offering price and redemption $1.00
price per share ($1,507,673,779 (divided by) 1,507,757,768
shares)
</TABLE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED DECEMBER 31, 1994 (UNAUDITED)
INTEREST INCOME $ 33,568,923
EXPENSES
Management fee $ 2,552,417
Non-interested trustees' compensation 35,454
TOTAL EXPENSES 2,587,871
NET INTEREST INCOME 30,981,052
NET REALIZED GAIN (LOSS) ON INVESTMENTS (2,445)
NET INCREASE IN NET ASSETS RESULTING FROM $ 30,978,607
OPERATIONS
CASH PORTFOLIO
FINANCIAL STATEMENTS - CONTINUED
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
DECEMBER 31, 1994 YEAR ENDED
(UNAUDITED) JUNE 30, 1994
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations $ 30,981,052 $ 42,506,073
Net interest income
Net realized gain (loss) (2,445) (60,018)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 30,978,607 42,446,055
FROM OPERATIONS
Dividends to shareholders from net (30,981,052) (42,506,073)
interest income
Share transactions at net asset value of $1.00 per 2,744,191,569 5,225,281,864
share
Proceeds from sales of shares
Reinvestment of dividends from net interest 27,486,756 37,442,132
income
Cost of shares redeemed (2,485,448,823) (5,344,335,280)
Net increase (decrease) in net assets and shares 286,229,502 (81,611,284)
resulting from share transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS 286,227,057 (81,671,302)
NET ASSETS
Beginning of period 1,221,446,722 1,303,118,024
End of period $ 1,507,673,779 $ 1,221,446,722
</TABLE>
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED
DECEMBER 31, 1994 YEARS ENDED JUNE 30,
(UNAUDITED) 1994 1993 1992 1991 1990
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .023 .031 .030 .046 .070 .082
Net interest income
Less Distributions (.023) (.031) (.030) (.046) (.070) (.082)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 2.35% 3.10% 3.04% 4.67% 7.23% 8.55%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 1,507,674 $ 1,221,447 $ 1,303,118 $ 1,651,078 $ 1,405,579 $ 1,080,055
Ratio of expenses to average net assets .39%A .39% .39% .39% .40% .42%
Ratio of expenses to average net assets
before expense .39%A .39% .39% .39% .41% .44%
reductions
Ratio of net interest income to average net
assets 4.65%A 3.05% 3.00% 4.47% 6.90% 8.20%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED AND
WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIODS SHOWN.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST -
TERM PORTFOLIO
INVESTMENTS/DECEMBER 31, 1994 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
PRINCIPAL VALUE
AMOUNT (NOTE 1)
U.S. TREASURY OBLIGATIONS - 99.0%
Bills, yields at date of purchase - 67.8%
5.71%, 8/24/95 $ 10,000,000 $ 9,578,000
5.80%, 9/21/95 10,000,000 9,524,400
5.90%, 9/21/95 10,000,000 9,524,400
7.26%, 12/14/95 10,000,000 9,355,000
7.34%, 12/14/95 5,000,000 4,677,500
42,659,300
Notes, yields at date of purchase - 31.2%
5.875%, 5/31/96 5,000,000 4,891,400
6.50%, 9/30/96 15,000,000 14,730,450
19,621,850
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $62,698,187) 62,281,150
MATURITY
AMOUNT
REPURCHASE AGREEMENTS - 1.0%
In a joint trading account
(U.S. Treasury obligations)
dated 12/30/94 due 1/3/95
At 5.77% $ 608,390 608,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $63,306,187) $ 62,889,150
INCOME TAX INFORMATION:
At December 31, 1994, the aggregate cost of investment securities for
income tax purposes was $63,306,187. Net unrealized depreciation aggregated
$417,037.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST -
TERM PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1994 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS
Investment in securities, at value (including $ 62,889,150
repurchase agreements of $608,000) (cost
$63,306,187) - See accompanying schedule
Cash 787
Interest receivable 272,576
Total assets 63,162,513
LIABILITIES
Dividends payable $ 109,315
Accrued management fee 21,397
Total liabilities 130,712
NET ASSETS $ 63,031,801
Net Assets consist of:
Paid in capital $ 63,893,019
Distributions in excess of net investment (13,676)
income
Distributions in excess of net realized gain (430,505)
Net unrealized appreciation (depreciation) on (417,037)
investment securities
NET ASSETS, for 6,426,361 shares outstanding $ 63,031,801
NET ASSET VALUE, offering price and redemption $9.81
price per share ($63,031,801 (divided by) 6,426,361
shares)
</TABLE>
TERM PORTFOLIO
FINANCIAL STATEMENTS - CONTINUED
STATEMENT OF OPERATIONS
SIX MONTHS ENDED DECEMBER 31, 1994 (UNAUDITED)
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME $ 1,562,646
Interest Income
EXPENSES
Management fee $ 126,518
Non-interested trustees' compensation 4,625
TOTAL EXPENSES 131,143
NET INVESTMENT INCOME 1,431,503
REALIZED AND UNREALIZED GAIN (LOSS) (231,170)
Net realized gain (loss) on investment securities
Change in net unrealized appreciation (48,834)
(depreciation) on investment securities
NET GAIN (LOSS) (280,004)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 1,151,499
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
DECEMBER 31, 1994 YEAR ENDED
(UNAUDITED) JUNE 30, 1994
<TABLE>
<CAPTION>
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations $ 1,431,503 $ 2,328,084
Net investment income
Net realized gain (loss) (231,170) (35,609)
Change in net unrealized appreciation (48,834) (423,150)
(depreciation)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 1,151,499 1,869,325
FROM OPERATIONS
Distributions to shareholders: (1,429,653) (2,331,093)
From net investment income
In excess of net realized gain - (150,872)
TOTAL DISTRIBUTIONS (1,429,653) (2,481,965)
Share transactions 396,378 13,152,053
Net proceeds from sales of shares
Reinvestment of distributions 955,164 1,744,308
Cost of shares redeemed (4,536,549) (27,554,108)
Net increase (decrease) in net assets resulting (3,185,007) (12,657,747)
from share transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS (3,463,161) (13,270,387)
NET ASSETS
Beginning of period 66,494,962 79,765,349
End of period (including distributions in excess $ 63,031,801 $ 66,494,962
of net investment income of $13,676 and
$15,526, respectively)
OTHER INFORMATION
Shares
Sold 40,326 1,327,420
Issued in reinvestment of distributions 97,017 176,025
Redeemed (459,893) (2,782,280)
Net increase (decrease) (322,550) (1,278,835)
</TABLE>
FINANCIAL HIGHLIGHTS
SIX MONTHS ENDED
DECEMBER 31, 1994 YEARS ENDED JUNE 30,
(UNAUDITED) 1994 1993 1992 1991 1990
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 9.850 $ 9.940 $ 9.910 $ 9.820 $ 9.730 $ 9.780
Income from Investment Operations .221 .288 .337 .560 .741 .816
Net investment income
Net realized and unrealized gain (loss) (.040) (.046) .031 .097 .090 (.050)
Total from investment operations .181 .242 .368 .657 .831 .766
Less Distributions (.221) (.312) (.338) (.567) (.741) (.816)
From net investment income
From net realized gain on investments - (.020) - - - -
Total distributions (.221) (.332) (.338) (.567) (.741) (.816)
Net asset value, end of period $ 9.810 $ 9.850 $ 9.940 $ 9.910 $ 9.820 $ 9.730
TOTAL RETURN B 1.85% 2.47% 3.78% 6.86% 8.83% 8.15%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 63,032 $ 66,495 $ 79,765 $ 89,303 $ 83,656 $ 83,412
Ratio of expenses to average net assets .41%A .41% .41% .41% .41% .40%
Ratio of expenses to average net assets before expense .41%A .41% .41% .41% .45% .50%
reductions
Ratio of net investment income to average net assets 4.44%A 3.14% 3.41% 5.69% 7.56% 8.37%
Portfolio turnover rate - 494% 612% 424% 78% 23%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED AND
WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
THE NORTH CAROLINA CAPITAL MANAGEMENT TRUST
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES. Cash Portfolio and Term Portfolio (the
funds) are funds of The North Carolina Capital Management Trust (the
trust), formerly The North Carolina Cash Management Trust. The trust is
registered under the Investment Company Act of 1940, as amended (the 1940
Act), as an open-end management investment company organized as a
Massachusetts business trust. Shares of the trust are offered exclusively
to local governments and public authorities of the State of North Carolina.
Each fund is authorized to issue an unlimited number of shares. The
following summarizes the significant accounting policies of the funds:
SECURITY VALUATION.
CASH PORTFOLIO. As permitted under Rule 2a-7 of the 1940 Act, and certain
conditions therein, securities are valued initially at cost and thereafter
assume a constant amortization to maturity of any discount or premium.
TERM PORTFOLIO. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days are valued either at amortized cost or original
cost plus accrued interest, both of which approximate current value.
Securities for which market quotations are not readily available are valued
at their fair value as determined in good faith under consistently applied
procedures under the general supervision of the Board of Trustees.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, each fund is not subject to income taxes to
the extent that it distributes all of its taxable income for the fiscal
year. The schedules of investments include information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME.
CASH PORTFOLIO. Interest income, which includes amortization of premium and
accretion of original issue discount, is accrued as earned.
TERM PORTFOLIO. Interest income, which includes accretion of original issue
discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS.
CASH PORTFOLIO. Dividends are declared daily and paid monthly from net
interest income.
TERM PORTFOLIO. Distributions are declared daily and paid monthly from net
investment income. Distributions from realized gains, if any, are recorded
on the ex-dividend date.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to capital loss
carryforwards and losses deferred due to excise tax regulations. Term
Portfolio also utilized earnings and profits distributed to shareholders on
redemption of shares as a part of the dividends paid deduction for income
tax purposes.
Permanent book and tax differences relating to shareholder distributions
will result in reclassifications to paid in capital. Undistributed net
investment income may include temporary book and tax basis differences
which will reverse in a subsequent period.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
REPURCHASE AGREEMENTS. The funds, through their custodian, receive delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The funds' investment
adviser, Fidelity Management & Research Company (FMR), is responsible for
determining that the value of these underlying securities remains at least
equal to the resale price.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the funds, along with other registered
investment companies having management contracts with FMR, may transfer
uninvested cash balances into a joint trading account. These balances are
invested in one or more repurchase agreements that are collateralized by
U.S. Treasury obligations.
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR pays all expenses
except the compensation of any trustee or officer not employed by Fidelity
Investments and certain exceptions such as interest, taxes, brokerage
commissions and extraordinary expenses.
FMR receives a fee that is based upon a graduated series of rates ranging
from .38% to .41% of each fund's average net assets. For the period, the
management fees paid to FMR were equivalent to an annualized rate of .38%
and .41% for the Cash and Term Portfolios, respectively.
SUB-ADVISER FEE. As Cash Portfolio's investment sub-adviser, FMR Texas
Inc., a wholly- owned subsidiary of FMR, receives a fee from FMR of 50% of
the management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect, and after reducing the fee
for any payments by FMR pursuant to the fund's Distribution and Service
Plan.
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plans (the Plans), and in accordance with Rule 12b-1 of the 1940 Act, FMR
pays Fidelity Distributors Corporation (Distributors), an affiliate of FMR,
a distribution and service fee that is based on a graduated series of rates
ranging from .14% to .17% of each fund's average net assets. For the
period, FMR paid Distributors $1,077,474 and $44,750 on behalf of the Cash
and Term Portfolios, respectively, all of which was paid to Sterling
Capital Distributors, Inc., a wholly-owned subsidiary of Sterling Capital
Management Company.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUNDS. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUNDS UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS
OF, OR
GUARANTEED BY ANY DEPOSITORY INSTITUTION OR GOVERNMENTAL AGENCY. SHARES ARE
NOT
INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE
SUBJECT
TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL. NEITHER FUNDS
NOR FIDELITY
DISTRIBUTORS CORPORATION IS A BANK. FOR MORE INFORMATION, INCLUDING CHARGES
AND
EXPENSES, CALL FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND MONEY.
Page 27 = BLANK
Do NOT strip-in this type.
TRUSTEES
WILLIAM L. BYRNES
JOHN DAVID FOUST
W. OLIN NISBET III
HELEN A. POWERS
Bertram H. Witham
OFFICERS
WILLIAM L. BYRNES, PRESIDENT
J. GARY BURKHEAD, SENIOR VICE PRESIDENT
W. OLIN NISBET III, VICE PRESIDENT
James Calvin Rivers Jr., VICE PRESIDENT
Robert K. Duby, VICE PRESIDENT
BURNELL R. STEHMAN, VICE PRESIDENT
THOMAS D. MAHER, ASSISTANT VICE PRESIDENT
GARY L. FRENCH, TREASURER
JOHN H. COSTELLO, ASSISTANT TREASURER
ARTHUR S. LORING, SECRETARY
DAVID H. POTEL, ASSISTANT SECRETARY
DISTRIBUTION AGENT
Sterling Capital Distributors, Inc.
Charlotte, NC
CUSTODIAN
First Union National Bank of North Carolina
Charlotte, NC
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
SUB-ADVISER FOR CASH PORTFOLIO
FMR Texas Inc.
Irving, TX
TRANSFER AGENT
Fidelity Investments Institutional Operations Company
Boston, MA
NC-2-95S
