AMANA MUTUAL FUNDS TRUST
NOVEMBER 30, 1996 REPORT
INCOME FUND
GROWTH FUND
FELLOW SHAREOWNERS:
After the strong gains of 1995, we expected the 1996 markets to be weaker. And
in fact, interest rates rose for much of the year and corporate earnings' growth
slowed. But our caution was misplaced.
Tremendous inflows of individual and institutional retirement money drove all
market sectors up, as the public focused on long-term investments to build their
retirement funds. While a sharp July correction illustrated the market's
vulnerability, the rebound, through a startlingly-strong November, proves the
faith investors have in equities to deliver superior total returns. An estimated
$208 billion poured into stock mutual funds in the first 11 months of 1996, 60%
above the previouS full-year record in 1993. The 1996 stock market generally
favored momentum investing, rather than Saturna Capital's more value-oriented
style.
AMANA INCOME FUND
The Fund returned 12.7% to shareholders for the six months, a very respectable
return given its conservative, income-oriented investment focus. The Fund
returned 18.7% for the twelve months ended November 30, 1996. As a comparison,
the S&P Utilities Index provided total returns of 7.8% and 11.0% for the same
six and twelve months, respectively. For the last five years, Amana Income Fund
has returned an average 10.9% per year. Assets, at $15.2 million, are up 32%
from a year ago.
AMANA GROWTH FUND
The Growth Fund declined slightly for the six months through November 30,
decreasing 2.63% since May 31. The Fund returned 9.12% for the twelve months
ended November 30, 1996. As a comparison, the S&P 500 Stock Index provided total
returns of 14.4% and 27.9% for the same periods. Since its inception in February
1994, Amana Growth Fund has returned an average 11.1% per year. Assets at $5.6
million have jumped 133% in one year. <PAGE>
AMANA MUTUAL FUNDS TRUST
THE OUTLOOK
With low inflation, one can pay well for stocks sporting reasonable growth
prospects. As we see continued slow growth and flat interest rates, we expect
1997 to again be profitable for equity investors. The U.S. dollar will likely
appreciate again in 1997, and our forecast for earnings growth, in larger U.S.
companies, is an average 6 to 9%.
Electric utilities, which make up a significant portion of Amana Income Fund,
should benefit from lower costs and more efficient operations as deregulation
spreads in the industry. Technological change is exploding, lowering costs and
greatly increasing productivity. Out times are driven by the information
technologies in which America excels. We should be the beneficiaries of
long-term trends from which our shareholders are well positioned to benefit.
Internationalization of business both spurs and is spurred by the information
revolution.
To take advantage of these trends, we seek companies that are technological
leaders or have a significant international exposure. Our international
telecommunications company investments exemplify these trends.
Amana Growth Fund is best suited to investors where price volatility and current
income is not a concern. As portfolio managers, we increasingly seek companies
with solid earnings and prospects outside the United States. The Fund also
favors companies that employ little or no debt in their operations.
Additional detail and financial information is provided on the following pages.
As always, we appreciate your participation in the Amana Funds and we welcome
your comments and suggestions. If you have any questions or need help, please
call us at 800/SATURNA. Also, more shareowners are connecting via the Internet
at www.saturna.com.
Respectfully yours,
Nicholas Kaiser, Bassam Ossman,
President Chairman
December 27, 1996
<PAGE>
<TABLE>
<CAPTION>
INCOME FUND AMANA MUTUAL FUNDS TRUST
INVESTMENTS
November 30, 1996
Number Market
Issue of Shares Cost Value
- -------------------------------------------------------------------------------
COMMON STOCKS (94.6%)
BUSINESS SERVICES (5.6%)
<S> <C> <C> <C>
ACNielsen 2,166 $ 28,635 $ 37,634
H&R Block 15,000 495,643 438,750
Cognizant 6,500 180,056 224,250
Dun & Bradstreet 6,500 122,328 147,875
---------- ----------
826,662 848,509
CHEMICALS (5.7%)
ARCO Chemical 6,500 238,792 325,000
Chemed 10,000 356,116 375,000
Lawter International 14,738 116,591 176,856
---------- ----------
711,499 876,856
DIVERSIFIED OPERATIONS (1%)
Hanson pic ADR 20,000 176,551 135,000
MACHINERY (5.2%)
Manitowoc Company 18,000 276,657 789,750
MEDICAL (10.9%)
American Home Products 10,000 242,862 642,500
Bristol-Myers Squibb 6,000 261,835 682,500
Glaxo Wellcome pic ADR 10,000 260,426 328,750
---------- ----------
765,123 1,653,750
MINING (5.8%)
ASARCO 20,000 578,558 545,000
RTZ Corp PLC ADS 5,000 279,565 338,125
---------- ----------
858,123 883,125
OIL & GAS PRODUCTION (9.5%)
Atlantic Richfield 4,000 447,256 556,500
Exxon 5,000 307,279 471,875
Mobil Corporation 3,500 395,105 423,500
---------- ----------
1,149,640 1,451,875
RUBBER & PLASTICS (2.4%)
RPM, Inc 20,312 182,267 368,164
PAPER PRODUCTS (3.0%)
Boise Cascade 8,000 266,023 248,000
Consolidated Papers 4,000 218,214 198,500
---------- ----------
484,237 446,500
TOOLS (1.5%)
Regal-Beloit 12,000 201,752 232,500
TELECOMMUNICATIONS (16.5%)
BCE, Inc 13,000 436,370 651,625
Cable & Wireless PLC ADR 16,000 310,930 386,000
GTE Corp. 10,000 410,441 448,750
Pacific Telesis Group 14,000 375,305 518,000
Telefonica de Espana, ADR 7,500 202,956 495,000
---------- ----------
1,736,002 2,499,375
November 30, 1996 Report
<PAGE>
AMANA MUTUAL FUNDS TRUST INCOME FUND
INVESTMENTS, continued
Number Market
Issue of Shares Cost Value
- -------------------------------------------------------------------------------
UTILITIES - ELECTRIC (18%)
Enova 22,000 482,336 492,250
FPL Group 10,000 344,874 461,250
Idaho Power 15,000 405,839 463,125
NIPSCO Industries 10,000 362,972 387,500
Pacific Gas & Electric 20,000 458,942 482,500
Washington Water Power 25,000 441,583 471,875
---------- ----------
2,496,546 2,758,500
UTILITIES - WATER & GAS (9.3%)
American Water Works 20,000 295,430 395,000
Peoples Energy 14,000 380,014 507,500
Piedmont Natural Gas 20,200 286,927 507,525
---------- ----------
962,371 1,410,025
TOTAL INVESTMENTS (94.6%) 10,827,430 14,353,929
Other Assets (net of liabilities)(5.4%) =========== 815,502
-----------
TOTAL NET ASSETS (100%) $15,169,431
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS Selected data per share of capital stock outstanding
throughout each period:
Period ended For Year Ended May 31
----------------------------------------------
Nov.30, 1996 1996 1995 1994 1993 1992 1991 1990 1989 1988
------------ ---- ---- ---- ---- ---- ---- ---- ---- ----
NET ASSET VALUE AT
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
BEGINNING OF PERIOD $13.93 $12.92 $12.18 $12.86 $11.94 $11.36 $10.86 $10.39 $ 9.11 $10.73
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.18 0.42 0.38 0.30 0.32 0.32 0.39 0.38 0.38 0.30
Net gains or losses on
securities
(both realized
and unrealized) 1.53 1.76 0.80 (0.36) 0.92 0.58 0.46 0.53 1.29 (1.65)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total From Investment
Operations 1.71 2.18 1.18 (0.06) 1.24 0.90 0.85 0.91 1.67 (1.35)
LESS DISTRIBUTIONS
Dividends (from net
investment income) 0.00 (0.41) (0.44) (0.30) (0.32) (0.32) (0.35) (0.44) (0.39) (0.27)
capital gains) 0.00 (0.76) 0.00 (0.32) 0.00 0.00 0.00 0.00 0.00 0.00
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total Distributions 0.00 (1.17) (0.44) (0.62) (0.32) (0.32) (0.35) (0.44) (0.39) (0.27)
NET ASSET VALUE
AT END OF PERIOD $15.64 $13.93 $12.92 $12.18 $12.86 $11.94 $11.36 $10.86 $10.39 $9.11
TOTAL RETURN 12.65% 17.03% 9.95% (0.63)% 10.26% 7.88% 8.11% 8.85% 18.86% (12.68)%
RATIOS/SUPPLEMENTAL DATA
- ------------------------
Net assets ($000),
end of period $15,169 $12,464 $10,708 $10,432 $9,398 $6,913 $5,868 $4,760 $3,645 $3,559
Ratio of expenses to
ave. net assets 0.76% 1.57% 1.56% 1.58% 1.58% 1.58% 1.66% 1.76% 1.88% 2.07%
Ratio of net investment
income to ave. net
assets 1.14% 3.06% 3.11% 2.22% 2.65% 2.75% 3.73% 3.67% 3.85% 3.17%
Portfolio turnover rate 6% 24% 29% 21% 29% 19% 29% 19% 71% 66%
Average commission rate
paid $.035 $.046
November 30,1996 Report
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
INCOME FUND AMANA MUTUAL FUNDS TRUST
STATEMENT OF ASSETS AND LIABILITIES
November 30, 1996
ASSETS
<S> <C>
Common stock investments (cost $10,827,4 $14,353,929
Cash 705,363
Receivable for Security Sales 217,827
Dividends receivable 48,656
Insurance deposit 2,529
------------
Total Assets 15,328,304
------------
LIABILITIES
Payable to affiliate 3,692
Payable for Security Purchases 155,181
------------
Total liabilities 158,873
------------
NET ASSETS $15,169,431
============
FUND SHARES OUTSTANDING 970,019
ANALYSIS OF NET ASSETS
Paid in capital (unlimited shares authorized,
without par) 11,334,443
Undistributed net investment income 182,571
Accumulated net realized gain on investments 125,918
Unrealized net appreciation on investments 3,526,499
------------
Net Assets applicable to Fund shares outstanding $15,169,431
============
NET ASSET VALUE PER SHARE $15.64
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
Six Months Ended November 30, 1996
INVESTMENT INCOME
<S> <C> <C>
Dividends $274,711
Miscellaneous Income 27
------------
Gross investment income $274,738
EXPENSES
Investment adviser and administration fee 64,293
Professional fees 8,752
Filing and registration fees 6,472
Shareowner servicing 9,622
Miscellaneous taxes 7,500
Printing and postage 2,446
Custodian Expenses 1,240
Other expenses 2,444
-------------
Total gross expenses 102,769
-------------
Less earnings credits (1,240)
-------------
Net expenses 101,529
------------
Net investment income 173,209
------------
NET REALIZED GAIN ON INVESTMENTS
Proceeds from sales 823,006
Less cost of securities
sold based on identified cost 702,691
--------------
Realized net gain 120,315
------------
UNREALIZED GAIN ON INVESTMENTS
End of period 3,526,499
Beginning of period 2,191,604
--------------
Increase in unrealized gain for period 1,334,895
------------
Net realized and unrealized
gain on investments 1,455,210
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $1,628,419
============
</TABLE>
November 30, 1996 Report
<PAGE>
<TABLE>
<CAPTION>
AMANA MUTUAL FUNDS TRUST INCOME FUND
STATEMENT OF CHANGES IN NET ASSETS
Period ended Year ended
Nov. 30, 1996 May 31, 1996
INCREASE IN NET ASSETS
FROM OPERATIONS
<S> <C> <C>
Net investment income $173,209 $345,592
Net realized gain on investments 120,315 640,173
Net increase in unrealized
appreciation 1,334,895 793,854
---------- ----------
Net increase in net assets 1,628,419 1,779,619
---------- ----------
DIVIDENDS TO SHAREOWNERS FROM
Net investment income - (341,768)
Capital gains distributions - (630,728)
---------- ----------
- (972,496)
FUND SHARE TRANSACTIONS
Proceeds from sales of shares 1,849,456 2,282,709
Value of shares issued in
reinvestment of dividends - 950,785
---------- ----------
1,849,456 3,233,494
Cost of shares redeemed (772,840) (2,284,062)
---------- ----------
Net increase in net assets from
share transactions 1,076,616 949,432
---------- ----------
Total increase in net assets 2,705,035 (23,064)
NET ASSETS
Beginning of period 12,464,396 10,707,841
---------- ----------
End of period $15,169,431 $12,464,396
=========== ===========
(Including undistributed net investment
income of $182,571 for Nov. 30,1996)
Shares of the Fund Sold and Redeemed
Number of shares sold 208,469 165,713
Number of shares issued in
reinvestment of dividends 0 67,575
Number of shares redeemed (133,007) (167,597)
----------- ----------
Net Increase in Number of Shares
Outstanding 75,462 65,691
=========== ==========
</TABLE>
November 30, 1996 Report
<PAGE>
<TABLE>
<CAPTION>
GROWTH FUND AMANA MUTUAL FUNDS TRUST
INVESTMENTS
November 30, 1996
Number Market
Issue of Shares Cost Value
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMON STOCKS (96.3%)
AUTOMOTIVE (1.6%)
Genuine Parts 2,000 $89,355 $90,000
BUILDING (5.9%)
BMC West 6,000 95,997 71,250
Butler Manufacturing 2,500 60,890 79,687
Champion Enterprises 3,000 60,485 62,625
Regal-Beloit Corporation 6,000 107,448 116,250
------- --------
324,820 329,812
CHEMICALS (2.8%)
Ionics 1,500 69,467 72,375
RPM, Inc. 4,625 71,869 83,828
------- --------
141,336 156,203
COMPUTERS (8.1%)
Advanced Digital Information 5,000 15,230 58,125
Apple Computer 3,000 76,382 72,375
Compaq Computer 2,000 92,662 158,500
Hewlett-Packard 2,000 41,638 107,750
Shiva 1,400 24,546 57,750
------- --------
250,458 454,500
COMPUTER SOFTWARE (10.5%)
Adobe Systems 3,000 115,558 118,500
Informix 4,000 78,967 95,000
Intuit 2,500 94,298 89,375
Microsoft 700 70,040 109,812
Oracle 2,400 78,773 117,600
Phamis 5,000 59,661 60,625
------- --------
497,297 590,912
FOOD PRODUCTION (4.2%)
Coca-Cola FEMSA S.A. ADR 2,400 57,093 65,700
Pioneer Hi-Bred International 1,100 77,928 76,725
Potash Corp of Saskatchewan 1,200 87,709 90,450
------- --------
222,730 232,875
ELECTRONICS (10.5%)
Merix 5,500 101,977 89,375
FLIR Systems 8,000 109,013 109,000
GaSonics International 8,000 74,183 86,000
Micron Technology 3,000 96,873 99,375
Motorola 1,800 98,916 99,675
Qualcomm 2,500 72,970 105,000
-------- --------
553,932 588,425
FINANCIAL & BUSINESS SERVICES (4.3%)
Block (H & R) 3,000 83,743 87,750
Hutchison Whampoa ADR 2,000 62,091 77,500
Reuters Holdings PLC-ADR 1,000 43,333 72,625
-------- --------
189,167 237,875
MACHINERY (5.7%)
Crane 2,000 76,234 93,500
Deere & Co 3,000 117,166 133,875
Valley Forge 7,000 105,321 90,125
-------- --------
298,721 317,500
MEDICAL TECHNOLOGY (6.8%)
Amgen 1,200 32,403 73,050
Ligand Pharmaceuticals 4,000 58,132 48,250
Liposome 4,000 21,665 72,000
Glaxo Wellcome plc ADR 2,500 55,379 82,188
Johnson & Johnson 2,000 91,871 106,500
-------- --------
259,450 381,988
MINING & PRECIOUS METALS (5.2%)
Barrick Gold 3,000 85,243 90,000
Cyprus Amax Minerals 4,000 96,600 99,000
Freeport-McMoran Copper & Gold 2,000 70,595 63,000
RTZ Corp PLC ADS 600 30,466 40,575
-------- --------
282,904 292,575
November 30, 1996
<PAGE>
INVESTMENTS, continued
OIL & GAS PRODUCTION (8.3%)
Atlantic Richfield 900 104,880 125,212
Noble Drilling 8,750 60,832 168,438
Williams Companies 1,200 60,536 67,350
YPF S.A. ADS 4,500 99,630 104,625
-------- --------
325,878 465,625
PAPER & PUBLISHING (2.7%)
Aracruz Cellulose SA ADR 8,000 67,596 62,000
McGraw-Hill 2,000 89,380 91,000
-------- --------
156,976 153,000
142,250
PHOTOGRAPHIC SUPPLIES (1.1%)
Fuji Photo Film ADR 2,000 46,837 63,000
RETAIL (6.5%)
Gap 2,000 62,591 64,250
Nike, Class B 1,200 68,493 68,250
Nordstrom 3,100 124,674 134,850
Seattle FilmWorks 5,000 82,667 98,125
-------- --------
338,425 365,475
STEEL PRODUCERS (1.6%)
Schnitzer Steel Industries 3,300 79,380 90,338
TELECOMMUNICATIONS (3.0%)
PT Indosat ADR 2,000 69,719 55,250
Telefonica de Espana ADS 1,700 70,376 112,200
-------- --------
140,095 167,450
TRANSPORTATION (7.5%)
Fritz Companies 6,000 74,863 90,750
Mesa Airlines 10,000 87,781 98,750
Southwest Airlines 5,000 132,586 123,750
Trinity Industries 3,000 102,499 103,500
-------- --------
397,729 416,750
TOTAL INVESTMENTS (96.3%) $4,595,490 5,394,303
==========
Other Assets (net of liabilities) (3.7%) 207,527
----------
TOTAL NET ASSETS (100%) $5,601,830
==========
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS Selected data per share of capital stock outstanding
throughout each period:
Period Year Year 2/03/1994
Ending Ending Ending (Inception
11/30/1996 5/31/1996 5/31/1995 to 5/31/94
---------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
NET ASSET VALUE AT BEGINNING OF PERIOD $6.86 $5.04 $4.69 $5.00
INCOME FROM INVESTMENT OPERATION
Net investment income (0.02) (0.05) (0.04) (0.01)
Net gains or losses on securities
(both realized and unrealized) (0.18) 1.95 0.39 (0.30)
------ ------ ------ ------
Total from investment operations (0.20) 1.90 0.35 (0.31)
LESS DISTRIBUTIONS
Dividends (from net investment income) 0.00 0.00 0.00 (0.01)
Distributions (from capital gains) 0.00 (0.08) 0.00 0.00
------ ------ ------ ------
Total distributions 0.00 (0.08) 0.00 (0.01)
NET ASSET VALUE AT END OF PERIOD $6.66 $6.86 $5.04 $4.69
TOTAL RETURN (1.56)% 37.20% 7.46% (6.20)%
RATIOS/SUPPLEMENTAL DATA
- ------------------------
Net assets ($000), end of period $5,602 $4,151 $1,974 $ 952
Ratio of expenses to average net assets 0.74% 1.94% 2.00% 0.62%
Ratio of net investment income to
average net assets (0.25)% (0.79)% (0.82)% (0.35)%
Portfolio turnover rate 10% 22% 38% 6%
Average commission rate paid $0.060 $0.059
</TABLE>
November 30, 1996 Report
<PAGE>
<TABLE>
<CAPTION>
GROWTH FUND AMANA MUTUAL FUNDS TRUST
STATEMENT OF ASSETS AND LIABILITIES
November 30, 1996
ASSETS
<S> <C>
Common stock investments (cost $4,595,490) $5,394,303
Cash 203,169
Dividends receivable 3,114
Organization expense, unamortized 1,636
-----------
Total Assets 5,602,222
LIABILITIES
Payable to affiliate 392
-----------
Total Liabilities 392
-----------
NET ASSETS $5,601,830
===========
FUND SHARES OUTSTANDING 841,708
ANALYSIS OF NET ASSETS
Paid in capital (unlimited shares
authorized, without par value) 4,813,501
Undistributed net investment income (loss) (49,667)
Accumulated net realized gain on investments 39,183
Unrealized net appreciation on investments 798,813
-----------
Net Assets applicable to Fund shares outstanding $5,601,830
===========
NET ASSET VALUE PER SHARE $6.66
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED NOVEMBER 30, 1996
INVESTMENT INCOME
<S> <C> <C>
Dividends $ 20,700
Miscellaneous Income 219
----------
Gross investment income $ 20,919
EXPENSES
Investment adviser fee 21,829
Professional fees 2,189
Custodian Fees 1,578
Shareholder servicing 4,996
Printing and postage 901
Filing and registration fees 3,039
Miscellaneous taxes 554
Other expenses 1,312
----------
Total gross expenses 36,398
Less earnings credits 1,578
----------
Net expenses 34,820
---------
Net investment income (13,901)
NET REALIZED GAIN ON INVESTMENTS
Proceeds from sale 414,894
Less cost of securities sold
based on identified cost 380,546
----------
Realized net gain 34,348
--------
UNREALIZED GAIN (LOSS) ON INVESTMENTS
End of period 798,813
Beginning of period 884,447
----------
Decrease in unrealized gain for the period (85,634)
---------
Net realized and unrealized gain (loss)
on investments (51,286)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $(65,187)
=========
</TABLE>
November 30, 1996 Report
<PAGE>
<TABLE>
<CAPTION>
AMANA MUTUAL FUNDS TRUST GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
Period ended Year ended
Nov. 30, 1996 May 31, 1996
INCREASEE IN NET ASSETS
<S> <C> <C>
FROM OPERATIONS
Net investment income $ (13,901) $ (20,616)
Net realized gain on investments 34,348 102,232
Net increase (decrease) in unrealized
appreciation (85,634) 746,721
------------- ------------
Net increase (decrease) in net assets (65,187) 828,337
------------- ------------
DIVIDENDS TO SHAREOWNERS FROM
Net investment income - -
Capital gains distributions - (44,764)
------------- ------------
- (44,764)
------------- ------------
FUND SHARE TRANSACTIONS
Proceeds from sales of shares 1,895,734 2,282,028
Value of shares issued in reinvestment - 44,134
of dividends ------------- ------------
1,895,734 2,326,162
Cost of shares redeemed (379,499) (933,301)
------------- ------------
Net increase in net assets from share
transactions 1,516,235 1,392,861
------------- ------------
Total increase in net assets 1,451,048 1,348,097
NET ASSETS
Beginning of period 4,150,782 1,974,348
------------- ------------
End of period $5,601,830 $4,150,782
============= ============
Shares of the Fund Sold and Redeemed
Number of shares sold 302,192 370,342
Number of shares issued in reinvestment
of dividends 0 6,452
Number of shares redeemed (65,547) (163,437)
------------- ------------
Net Increase in Number of Shares Outstanding 236,645 213,357
============= ============
</TABLE>
November 30, 1996
SUPPLEMENTARY INFORMATION
ORGANIZATION
Amana Mutual Funds Trust (the "Trust") was established under Indiana Law as a
Business Trust on July 26, 1984. The Trust is registered as a no-load, open-end,
diversified series investment company under the Investment Company Act of 1940,
as amended. The Trust restricts its investments to those acceptable to Muslims
by investing in accordance with Islamic principles. Two portfolio series have
been created. The Income Fund was first authorized to sell shares of beneficial
interest to the public on June 23, 1986. The Growth Fund began operations on
February 3, 1994.
TRANSACTIONS WITH AFFILIATED PERSONS
Saturna Capital Corporation, under contracts approved by Income Fund shareowners
on December 28, 1989, and the initial shareholder of Amana Growth Fund on
February 1, 1994, provides investment advisory services and certain other
administrative and distribution services and facilities required by each Fund to
conduct its business. For such services, each Fund pays an annual fee equal to
.95% of its average daily net assets. In the event that total expenses of a Fund
in any one year (excluding interest, brokerage commissions and federal and state
taxes) exceeds 2%, Saturna Capital reimburses the Fund the amount of any such
excess. The president of Saturna Capital is a trustee and, together with his
family owns 2.2% of the Income Fund and 1% of the Growth Fund. North American
Islamic Trust, Inc. (owning 3.7% of the Income Fund and 2% of the Growth Fund),
is the religious consultant to Saturna regarding Islamic principles. From its
advisory fee, Saturna pays North American Islamic Trust, Inc. a fee equal to
.20% of the average daily net assets of each Fund. One trustee of Amana is a
trustee of North American Islamic Trust.
Saturna Capital also acts as a transfer agent to each Fund for a fee of $1.30
per month per active account. The Trust acts as distributor of its own shares,
except in those states where Investors National Corporation (a subsidiary of
Saturna Capital Corporation) is registered as a broker-dealer and is willing to
act as distributor without compensation. Investors National Corporation, a
discount broker, often executes securities transactions for the Funds at
Investors National's discount commission rate: 3 cents per share plus the price
of one share.
All trustees serve without compensation.
<PAGE>
EXPERIENCE IN IMPORTANT
Amana Mutual Funds Trust began operation in 1986. Saturna Capital, with
extensive experience in mutual funds, invests the Fund portfolios and handles
their operations.
The Trust is managed by a Board of five Trustees, all serving without
compensation:
Trustees
Bassam Osman, MD, Chairman
Nicholas Kaiser, MBA, President
M. Yaqub Mirza, PhD, Treasurer
Jamal M. al-Barzinji, PhD
Iqbal Unus, PhD
Officers
Bassam Osman, Chairman
Nicholas Kaiser, President
M. Naziruddin Ali, Vice-President
P. M. Larner, Secretary
M. Yaqub Mirza, Treasurer
T. K. Anderson, Asst. Treasurer
Iqbal Unus, Asst. Secretary
SATURNA CAPITAL
(Graphic Omitted)
INVESTMENT ADVISER
AND
ADMINISTRATOR
NORTH AMERICAN ISLAMIC TRUST
RELIGIOUS CONSULTANT
This report is for the information of the shareowners of the Trust. It is not
authorized for distribution to prospective investors unless it is accompanied or
preceded by an effective prospectus.
AMANA
MUTUAL FUNDS
TRUST
INCOME FUND
GROWTH FUND
November 30, 1996
REPORT
Saturna Capital Corporation
1300 No. State Street
Bellingham, WA 98225-4730
800/SATURNA
(800/728-8762)
Daily Prices: 888/73-AMANA
