FAM
VALUE FUND
EQUITY-INCOME FUND
SEMI-ANNUAL REPORT
June 30, 1997
Each A
100%
No-Load
Fund
FAM FUNDS
P.O. Box 399
Cobleskill, NY 12043
(800) 932-3271
<PAGE>
DEAR SHAREHOLDER:
The first six months of 1997 turned out to be much better than expected.
The FAM Value Fund appreciated 13.4% and the FAM Equity-Income Fund appreciated
10.8%. In comparison, the Russell 2000, an unmanaged index of smaller company
stocks, advanced 10.2%. It would be easy to be lulled into the trap of
self-congratulation were it not for the fact that the unmanaged S&P 500
appreciated 20.6%. Humility is a trait that is useful in the investment world.
In your co-managers' cases, this trait is imperative because it keeps us focused
on what is controllable -D our value investment approach -D and not on variables
which are beyond our control.
We have been extremely pleased with the first six month's results for a
related and more important reason. It has started to have a favorable impact on
our longer-term performance, which is the primary goal of your Funds. As the
enclosed graph illustrates, FAM Value has a trailing 12-month return of 17.9%, a
five-year compounded annual return of 13.7%, and a ten-year compounded annual
return of 13.0%. The FAM Equity-Income Fund, which we began on April 1, 1996,
has a trailing 12-month return of 20.9%. Charlie Munger, Berkshire Hathaway's
Vice Chairman and Warren Buffett's partner, said at this year's annual meeting
that expectations in excess of 15% were arrogant. We would agree. Over
exuberance tends to lead to foolish decisions that may be validated in the short
term by the rising tide of the marketplace. But, in the long term each decision
must rest on the economic merit of the underlying business.
In this regard, the strong economic fundamentals of many of the businesses
owned by your Funds are continuing to shine. We have pointed out in the past
that our heavy weighting in the insurance industry reflected the superb
investment opportunity that existed in those businesses at bargain basement
prices. FAM Value Fund's three top performers for 1997 have been in this
industry -D Poe & Brown (+38%), Allied Group (+34%), and Reliastar (+26%). As a
whole, the insurance group performed admirably. Performance was also enhanced by
American Express (+42%), a financial service company, and Essef Corporation
(+50%). Top performers for FAM Equity-Income Fund included Poe & Brown (+38%)
and Gorman-Rupp (+32%), a company which produces large capacity pumps.
Pleasantly, there were few detractors. In the FAM Value Fund portfolio,
there are two worth mentioning: CONMED (-14%) and C-COR (-26%). The future
economic prospects for these businesses, we believe, are far greater than the
stock market has given recognition. CONMED is number one or two in providing
minimally invasive disposable surgical devices. C-COR is respected as a high
quality manufacturer of communication amplifiers. They represent companies that
meet our benchmarks -D businesses that are understandable, highly profitable,
financially strong, and are managed by people who exhibit a high degree of
integrity, intelligence, and energy. While our assumptions for these two
companies are sound, only the future will determine the success of our analysis.
The FAM Equity-Income Fund's performance was hindered by New Plan Realty
Trust (-13%) and Atrion Corporation (-4.5%). New Plan Realty is a Real Estate
Investment Trust (REIT) that has investments in retail strip centers, garden
apartments, and factory outlet centers. The stock is down despite its dramatic
growth in property acquisitions for the year. Atrion Corporation is a company
that is transitioning from a gas pipeline business to a faster growing
healthcare business. The company currently has 75% of the value of its stock
price in cash and is in the process of looking for opportunistic acquisitions to
complement its exisitng health care business. In spite of their dismal
performance year to date, we remain very excited about the prospects of these
companies.
- 1 -
<PAGE>
Lastly, we would like to throw out a word of caution to all investors. We
do not know what year-end 1997 might bring. We feel that it is highly unlikely
that market returns of the first six months will be repeated during the second
half. But we can reaffirm one certainty: our long-term investment focus will
remain intact. Our challenge is like that of a high jumper -D to continually
raise the bar with each investment decision. We assure you that in this process,
our enthusiasm will remain in check. In 1934, Benjamin Graham introduced the
concept of margin of safety. In essence, margin of safety dictates that shares
of any business should only be purchased at a significant discount to the
intrinsic value of the business. It is our strict adherence to this benchmark
that will keep us focused on our longer-term objectives, and our pledge to you
to preserve your future purchasing power without undo risk.
We look forward to sharing with you a full report of our year-end results.
At that time we also plan to elaborate more fully on our investment benchmarks.
Thank you for your continued interest.
Sincerely,
/s/THOMAS O. PUTNAM /s/DIANE C. VAN BUREN /s/PAUL C. HOGAN, CFA
THOMAS O. PUTNAM DIANE C. VAN BUREN PAUL C. HOGAN, CFA
<PAGE>
<TABLE>
<CAPTION>
DISTRIBUTION AMOUNT PRICE SHARES TOTAL SHARES VALUE
------------ ------ ----- ------ ------------ -----
<S> <C> <C> <C> <C> <C> <C>
01/02/87 $1,000.00 $9.97 100.301 100.301 $1,000.00
03/31/87 $11.06 100.301 $1,109.33
06/30/87 $11.19 100.301 $1,122.37
09/30/87 $11.60 100.301 $1,163.49
12/31/87 DIV 0.1200 $12.04 $8.14 1.479 101.780 $828.49
12/31/87 $0.00 $8.14 0.000 101.780 $828.49
03/31/88 $9.51 101.780 $967.92
06/30/88 $10.11 101.780 $1,028.99
09/30/88 $10.66 101.780 $1,084.97
12/30/88 DIV 0.2500 $25.44 $10.78 2.360 104.140 $1,122.63
12/31/88 $0.00 $10.78 0.000 104.140 $1,122.63
03/31/89 $11.67 104.140 $1,215.31
06/30/89 $12.65 104.140 $1,317.37
09/30/89 $13.55 104.140 $1,411.10
12/28/89 DIV 0.1190 $12.39 $12.76 0.971 105.111 $1,341.22
12/31/89 $0.00 $12.85 0.000 105.111 $1,350.68
03/31/90 $12.56 105.111 $1,320.20
06/30/90 $13.54 105.111 $1,423.20
09/30/90 $11.44 105.111 $1,202.47
12/28/90 DIV 0.0960 $10.09 $11.95 0.844 105.956 $1,266.17
12/31/90 $0.00 $12.06 0.000 105.956 $1,277.82
03/31/91 $14.57 105.956 $1,543.77
06/30/91 $16.24 105.956 $1,720.72
09/30/91 $17.03 105.956 $1,804.42
12/27/91 DIV 0.9000 $95.36 $16.25 5.868 111.824 $1,817.14
12/31/91 $0.00 $16.87 0.000 111.824 $1,886.47
03/31/92 $18.94 111.824 $2,117.94
06/30/92 $18.02 111.824 $2,015.07
09/30/92 $17.87 111.824 $1,998.29
12/24/92 DIV 0.5740 $64.19 $19.80 3.242 115.066 $2,278.30
12/31/92 $0.00 $20.50 0.000 115.066 $2,358.84
03/31/93 $20.63 115.066 $2,373.80
06/30/93 $20.09 115.066 $2,311.67
09/30/93 $20.72 115.066 $2,384.16
12/24/93 DIV 0.1396 $16.06 $20.03 0.802 115.868 $2,320.83
12/31/93 $0.00 $20.40 0.000 115.868 $2,363.70
03/31/94 $19.60 115.868 $2,271.00
06/30/94 $19.84 115.868 $2,298.81
09/30/94 $20.97 115.868 $2,429.74
12/28/94 DIV 0.7508 $86.99 $20.96 4.150 120.018 $2,515.58
12/31/94 $0.00 $21.04 0.000 120.018 $2,525.18
03/31/95 $21.09 120.018 $2,531.18
06/30/95 $22.86 120.018 $2,743.61
09/30/95 $24.85 120.018 $2,982.45
12/28/95 0.6068 $72.83 $24.40 2.985 123.003 $3,001.27
12/31/95 $24.58 123.003 $3,023.41
03/31/96 $25.28 123.003 $3,109.51
06/30/96 $26.30 123.003 $3,234.97
09/30/96 $25.81 123.003 $3,174.71
12/27/96 0.8100 $99.63 $26.48 3.763 126.765 $3,356.74
12/31/96 $26.53 126.765 $3,363.08
03/31/97 $26.20 126.765 $3,321.25
06/30/97 $30.09 126.765 $3,814.37
</TABLE>
<TABLE>
<CAPTION>
QUARTERLY NUMBERS FOR FAM VALUE FUND
------------------------------------
<S> <C> <C> <C>
03/31/97 QTR 06/30/97 QTR
-------- --- -------- ---
current NAV $ 33,222.00 current NAV $ 38,155.00
prior qtr NAV $ 33,626.00 prior qtr NAV $ 33,222.00
% qtr performance -1.20% % qtr performance 14.85%
YTD YTD
--- ---
current NAV $ 33,222.00 current NAV $ 38,155.00
Jan. 1 NAV $ 33,626.00 Jan. 1 NAV $ 33,626.00
YTD performance -1.20% YTD performance 13.47%
1 YEAR 1 YEAR
------ ------
current value $ 33,222.00 current value $ 38,155.00
prior year value $ 31,108.00 prior year value $ 32,352.00
1 yr performance 6.80% 1 yr performance 17.92%
3 YEAR 3 YEAR
------ ------
current value $ 33,222.00 current value $ 38,155.00
3 yrs prior value $ 22,724.00 3 yrs prior value $ 23,014.00
3 yr cumulative performance 46.20% 3 yr cumulative 65.79%
performance
3 year annualized performance 13.50% 3 year annualized
performance 18.36%
5 YEAR 5 YEAR
------ ------
current value $ 33,222.00 current value $ 38,155.00
5 years prior value $ 1,115.00 5 years prior value $ 20,090.00
5 yr cumulative performance 57.30% 5 yr cumulative
performance 89.92%
5 year annualized performance 9.50% 5 year annualized
performance 13.69%
10 YEAR 10 YEAR
------- -------
current value $ 33,626.00 current value $ 38,155.00
10 years prior value $ 11,236.00 10 years prior value $ 1,236.00
10 yr cumulative performance 199.27% 10 yr cumulative
performance 229.58%
10 year annualized performance 11.59% 10 year annualized
performance 13.00%
INCEPTION INCEPTION
--------- ---------
current value $ 33,222.00 current value $ 38,155.00
initial value $ 10,000.00 initial value $ 10,000.00
cumulative performance 232.22% cumulative performance 281.55%
annualized performance 12.42% annualized performance 13.60%
</TABLE>
- 2 -
<PAGE>
<TABLE>
<CAPTION>
FAM VALUE FUND
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS
June 30, 1997 (Unaudited)
COMMON STOCKS (97.2%) Shares Value
<S> <C> <C>
------ -----
BANKING (12.7%)
Bank North Group ..................... 57,715 $2,669,319
Centura Banks, Inc. .................. 146,250 6,709,219
First Bank System, Inc. .............. 20,924 1,786,387
First Empire State Corporation ....... 17,300 5,830,100
One Valley Bancorp, Inc. ............. 116,875 4,908,750
*Plumas Bank Quincy California ........ 57,024 769,824
SouthTrust Corporation ............... 142,000 5,875,250
TrustCo Bank Corporation NY .......... 141,216 3,018,428
----------
31,567,277
----------
CHEMICAL (0.6%)
WD-40 Company ......................... 25,400 1,524,000
----------
CONSUMER SERVICES (1.3%)
*Franklin Covey Company ............... 133,000 3,366,563
----------
DIVERSIFIED (0.5%)
*Berkshire Hathaway ................... 26 1,227,200
----------
DIVERSIFIED MANUFACTURING (9.2%)
CLARCOR, Inc. ....................... 182,500 4,516,875
+*ESSEF Corporation ................... 339,185 7,970,848
*Environment One Corporation ......... 18,000 175,500
Raven Industries, Inc. .............. 206,200 4,974,575
+ Versa Technologies, Inc. ............ 323,258 5,091,314
----------
22,729,112
----------
ELECTRICAL/ELECTRONICS (3.7%)
*C-COR Electronics, Inc. .............. 420,600 4,206,000
*IFR Systems .......................... 233,700 4,381,875
Sage Laboratories, Inc. .............. 45,500 580,125
----------
9,168,000
---------
FINANCIAL SERVICES (14.8%)
+*Allied Capital Advisers, Inc. ........ 500,000 2,343,750
American Express Company ............. 215,500 16,054,750
Fund America Enterprises Hldgs., Inc.. 111,975 11,757,375
Salomon, Inc. ........................ 119,000 6,619,375
----------
36,775,250
----------
See Notes to Financial Statements.
-3-
<PAGE>
FAM VALUE FUND
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (Cont'd)
June 30, 1997 (Unaudited)
Shares Value
GROCERY STORES (1.5%)
Hannaford Brothers Company ........... 105,700 $ 3,758,956
----------
HEALTH CARE (6.5%)
+*CONMED Corporation ................... 807,562 13,728,554
*Copley Pharmaceuticals, Inc. ......... 108,000 783,000
+*Hycor Biomedical, Inc. ............... 800,000 1,625,040
----------
16,136,594
----------
INSURANCE (26.8%)
+ Allied Life Financial Corporation .... 293,650 5,799,588
Allied Group, Inc. ................... 315,525 11,989,950
Farm Family Holdings ................. 18,000 501,750
Financial Secs Assurance Hldgs. Ltd... 51,800 2,016,963
Gainsco, Inc. ........................ 82,100 769,688
+ Intercargo Corporation ............... 334,850 3,934,488
Poe & Brown, Inc. .................... 133,075 4,923,775
Protective Life Corporation .......... 167,200 8,401,800
ReliaStar Financial Corporation ...... 233,100 17,045,438
UNUM Corporation ..................... 146,760 6,163,920
Vesta Insurance Group, Inc. .......... 112,000 4,844,000
-----------
66,391,360
-----------
MACHINERY & EQUIPMENT (12.8%)
IDEX Corporation ..................... 156,600 5,167,800
Kaydon Corporation ................... 297,500 14,763,438
+ Modern Controls, Inc. ................ 277,812 3,750,462
Regal-Beloit Corporation ............. 53,300 1,395,794
Tennant Corporation .................. 201,400 6,696,550
-----------
31,774,044
----------
POSTAGE & BUSINESS SERVICES (6.2%)
*Mailboxes Etc. ....................... 549,600 15,320,100
------------
PRINTING (3.4%)
*CSS Industries, Inc. ................. 241,500 7,637,438
Deluxe Corporation ................... 25,300 863,363
------------
8,500,712
------------
TOTAL INVESTMENTS (Cost $142,402,352) .. $248,239,250
============
<FN>
* Non-income producing
+ See Note 5
</FN>
</TABLE>
See Notes to Financial Statements.
- 4 -
<PAGE>
<TABLE>
<CAPTION>
FAM VALUE FUND
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1997 (Unaudited)
<S> <C> <C>
ASSETS
Investment in securities at market value
(Cost $142,402,352) ................................... $248,239,250
Cash at interest ......................................... 10,172,336
Dividends and interest receivable ........................ 175,521
Receivable for investment securities sold................. 302,802
-----------
Total Assets ........................................ 258,889,909
-----------
LIABILITIES
Payable for investment securities purchased............... 183,076
Accrued management fees .................................. 209,976
Accrued expenses ......................................... 103,987
-----------
Total Liabilities ................................... 497,039
-----------
NET ASSETS
Source of Net Assets:
Net capital paid in on shares of
beneficial interest ................ $ 155,800,944
Undistributed net investment income ... 346,356
Accumulated net realized loss ......... (3,591,328)
Net unrealized appreciation ........... 105,836,898
-----------
Net Assets ........................................ $ 258,392,870
==============
Net asset value per share; 8,587,308 shares of
beneficial interest outstanding (Note 3) ............. $30.09
======
</TABLE>
See Notes to Financial Statements.
- 5 -
<PAGE>
<TABLE>
<CAPTION>
Fam Value Fund
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
Six Months Ended June 30, 1997 (Unaudited)
INVESTMENT INCOME
<S> <C>
INCOME:
Dividends ............................... $ 1,571,063
Interest ................................ 289,084
-------------
Total Income ................. 1,860,147
-------------
EXPENSES:
Investment advisory fee (Note 2) ........ 1,209,595
Administrative fee (Note 2) ............. 30,240
Shareholder servicing and related
expenses (Note 2) .................... 143,176
Custodian fees .......................... 19,200
Registration fees ....................... 16,694
Professional fees ....................... 17,338
Printing and mailing .................... 59,212
Trustees ................................ 5,897
Other ................................... 12,722
-------------
Total Expenses ............... 1,514,074
-------------
Net Investment Income ........ 346,073
-------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized loss on investments ........ (3,591,947)
Unrealized appreciation of investments
for the period ....................... 34,444,698
-------------
Net Gain on Investments ...... 30,852,751
-------------
NET INCREASE IN NET ASSETS FROM OPERATIONS .. $ 31,198,824
=============
</TABLE>
See Notes to Financial Statements
- 6 -
<PAGE>
<TABLE>
<CAPTION>
FAM VALUE FUND
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended June 30, 1997 (Unaudited) and Year Ended December 31, 1996
<S> <C> <C>
SIX MONTHS YEAR ENDED
ENDED JUNE 30, DECEMBER 31,
1997 1996
---- ----
CHANGE IN NET ASSETS FROM OPERATIONS:
Net investment income ...........................$ 346,073 $ 1,647,125
Net realized loss on investments ................ (3,591,947) 5,833,011
Unrealized appreciation for the period........... 34,444,698 19,714,649
---------- ----------
Net Increase in Net Assets From Operations ... 31,198,824 27,194,785
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income ........................... -- (1,647,567)
Net realized gain on investments ................ -- (5,832,424)
CAPITAL SHARE TRANSACTIONS (Note 3) ...............(26,184,323) (33,494,361)
----------- -----------
Total Increase (Decrease) in Net Assets ...... 5,014,501 (13,779,567)
NET ASSETS:
Beginning of period ............................ 253,378,369 267,157,936
----------- -----------
End of period .................................$ 258,392,870 $253,378,369
============= ============
</TABLE>
See Notes to Financial Statements.
- 7 -
<PAGE>
FAM VALUE FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. SUMMARY OF ACCOUNTING POLICIES
FAM Value Fund (the "Fund") is a series of Fenimore Asset Management
Trust, a no-load, diversified, open-end management investment company
registered under the Investment Company Act of 1940. The investment
objective of the Fund is to seek a high long term total return
consisting of appreciation and dividend income from investments in
equity related securities. The following is a summary of significant
accounting policies followed in the preparation of its financial
statements.
a) Valuation of Securities - Securities traded on a national
securities exchange or admitted to trading on NASDAQ are valued at
the last reported sales price. Common stocks for which no sale was
reported, and over-the-counter securities, are valued at the last
reported bid price. Short term securities are carried at amortized
cost, which approximates market value.
b) 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 all of its taxable income to
its shareholders. Therefore, no provision for federal income tax is
required.
c) Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of increases and decreases in
net assets from operations during the reporting period. Actual
results could differ from those estimates.
d) Other - Securities transactions are recorded on the trade date
basis. Interest income is accrued as earned and dividend income is
recorded on the ex-dividend date. Dividends and distributions to
shareholders, which are determined in accordance with income tax
regulations, are recorded on the ex-dividend date.
NOTE 2. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Under the Investment Advisory Contract, the Fund pays an investment
advisory fee to Fenimore Asset Management, Inc. (the "Advisor") equal,
on an annual basis, to 1% of the Fund's average daily net assets.
Certain officers and trustees of the Fund are also officers and
directors of the Advisor. The Advisor is required to reimburse the Fund
for its expenses to the extent that such expenses, including the
advisory fee, for any fiscal year exceed 2% of the average daily net
assets. No such reimbursement was required for the six months ended
June 30, 1997. FAM Shareholder Services, Inc. (FSS), a company under
common control with the Advisor, serves as a shareholder servicing
agent for which it receives a monthly fee of $1.75 per shareholder
account. Additionally, FSS serves as the fund administrative agent for
which it receives a fee equal, on an annual basis, to 0.25% of the
Fund's average daily net assets.
- 8 -
<PAGE>
FAM VALUE FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 3. SHARES OF BENEFICIAL INTEREST
At June 30, 1997, an unlimited number of $.001 par value shares of
beneficial interest were authorized. Transactions were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
June 30, 1997 December 31, 1996
-------------------- -------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares sold 436,992 $11,997,602 1,100,612 $ 27,944,994
Shares issued on reinvestment
of dividends - - 272,279 7,209,938
Shares redeemed (1,398,999) (38,181,925) (2,691,651) (68,649,293)
---------- ------------ ---------- ------------
Net (decrease) increase (962,007) $(26,184,323) (1,318,766) $(33,494,361)
========== ============ ========== ============
</TABLE>
NOTE 4. INVESTMENT TRANSACTIONS
During the period ended June 30, 1997, purchases and sales of
investment securities, other than short term obligations, were
$6,545,638 and $32,520,376. The cost of securities for federal income
tax purposes is the same as shown in the investment portfolio. Realized
gains and losses are reported on an identified cost basis.
The aggregate gross unrealized appreciation of portfolio securities,
based on cost for federal income tax purposes, was as follows:
Unrealized appreciation $ 110,798,268
Unrealized (depreciation) (4,961,370)
--------------
Net unrealized appreciation $ 105,836,898
==============
NOTE 5. HOLDINGS OF 5% VOTING SECURITIES OF PORTFOLIO COMPANIES
Investments in portfolio companies, 5% or more of whose outstanding
voting securities are held by the Fund, are defined in the Investment
Company Act of 1940 as affiliated companies. Investments in affiliated
companies as of June 30, 1997, amounted to $40,309,556. For the period
ended June 30, 1997, dividend income of $133,666 was received from
affiliated companies, as well as net realized gains of $30,107 from the
sale of such securities.
- 9 -
<PAGE>
FAM VALUE FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 6. SELECTED FINANCIAL INFORMATION
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Years Ended December 31,
PER SHARE INFORMATION Six Months Ended ----------------------------------------
(For a share outstanding June 30, 1997 1996 1995 1994 1993 1992
throughout the period)
Net asset value, beginning of year .................. $ 26.53 $ 24.58 $ 21.04 $ 20.40 $ 20.50 $ 16.87
-------- ------- ------- ------- ------- -------
Income from investment operations:
Net investment income ....................... 0.04 0.18 0.21 0.12 0.09 0.10
Net realized and unrealized gain (loss)
on investments ...................... 3.52 2.58 3.94 1.27 (0.05) 4.11
-------- ------- ------- ------- ------- -------
Total from investment operations ............ 3.56 2.76 4.15 1.39 0.04 4.21
-------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income ........ -- (0.18) (0.21) (0.12) (0.09) (0.10)
Distributions from net realized gains -- (0.63) (0.40) (0.63) (0.05) (0.48)
-------- ------- ------- ------- ------- -------
Total distributions ......................... -- (0.81) (0.61) (0.75) (0.14) (0.58)
-------- ------- ------- ------- ------- -------
Change in net asset value for the period ............ 3.56 1.95 3.54 0.64 (0.10) 3.63
-------- ------- ------- ------- ------- -------
Net asset value, end of period ...................... $ 30.09 $ 26.53 $ 24.58 $ 21.04 $ 20.40 $ 20.50
======== ======= ======= ======== ======= =======
TOTAL RETURN ........................................ 27.06% 11.23% 19.71% 6.82% 0.21% 25.08%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000) ................... $ 258,393 $253,378 $267,158 $210,579 $220,138 $44,694
Ratios to average net assets of:
Expenses 1.25%* 1.27% 1.25% 1.39% 1.39% 1.50%
Net investment income 0.14%* 0.64% 0.92% 0.58% 0.57% 0.81%
Portfolio turnover rate 2.64%* 12.48% 9.67% 2.15% 4.83% 9.84%
Average commission rate paid
(per share) $ .0387 $0.0497
<FN>
*Annualized
</FN>
</TABLE>
- 10 -
<PAGE>
<TABLE>
<CAPTION>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS
June 30, 1997 (Unaudited)
SHARES/
PRINCIPAL VALUE
--------- -----
<S> <C> <C>
COMMON STOCKS (76.8%)
ADVERTISING SERVICES (4.1%)
American List .......................... 4,500 $ 135,561
----------
BANKING (13.1%)
Home Port Bancorp ...................... 8,000 156,000
SouthTrust Corporation ................. 2,600 107,575
TrustCo Bank Corporation NY ............ 8,140 173,993
----------
437,568
----------
CHEMICAL (3.6%)
WD-40 Company .......................... 2,000 120,000
----------
CONSUMER PRODUCTS (7.3%)
Jostens, Inc. .......................... 4,300 115,025
Stanhome, Inc. ......................... 3,900 128,213
----------
243,238
----------
DIVERSIFIED MANUFACTURING (14.3%)
CLARCOR, Inc. .......................... 4,200 103,950
Gorman-Rupp ............................ 5,800 104,400
Raven Industries, Inc. ................. 5,600 135,100
Versa Technologies, Inc. ............... 8,600 135,450
----------
478,900
----------
HEALTH CARE (10.6%)
ADAC Laboratories ...................... 3,500 82,688
Atrion Corporation ..................... 9,900 155,925
Landauer, Inc. ......................... 4,900 113,619
----------
352,232
----------
INSURANCE (9.3%)
Poe & Brown, Inc. ...................... 4,200 155,400
Pxre Corporation ....................... 1,200 36,900
ReliaStar Financial Corporation ........ 1,600 117,000
----------
309,300
----------
See Notes to Financial Statements
- 11 -
<PAGE>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (CONT'D)
June 30, 1997 (Unaudited)
SHARES/
PRINCIPAL VALUE
--------- -----
PRINTING (5.0%)
New England Business Services .......... 6,400 $ 168,400
------------
REAL ESTATE INVESTMENT TRUSTS (5.4%)
New Plan Realty ........................ 8,300 183,119
------------
REGULATED INVESTMENT COMPANY (4.1%)
Allied Capital Corporation ............. 8,500 136,000
------------
Total Common Stocks (cost $2,088,064) .. $ 2,564,318
------------
SHORT TERM OBLIGATIONS (23.2%)
U.S. Treasury Bills, 4.2 to 4.6% with maturities
to 7/4/97 (cost $773,419) .............. 775,000 $ 773,419
------------
TOTAL INVESTMENTS (Cost $2,861,483) .... $ 3,337,737
============
</TABLE>
See Notes to Financial Statements.
- 12 -
<PAGE>
<TABLE>
<CAPTION>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1997 (Unaudited)
ASSETS
<S> <C> <C>
Investment in securities at market value
(Cost $2,861,483) .................................. $ 3,337,737
Cash at interest ........................................... 70,391
Dividends and interest receivable .......................... 9,691
Deferred organization costs ................................ 11,127
-------------
Total Assets .................................... 3,428,946
-------------
LIABILITIES
Payable to investment advisor, organization costs .......... 11,127
Accrued expenses ........................................... 18,020
-------------
Total Liabilities ............................... 29,147
-------------
NET ASSETS
Source of Net Assets:
Net capital paid in on shares of
beneficial interest ...................... $ 2,923,564
Undistributed net investment income ......... 61
Accumulated net realized gain/loss .......... (79)
Net unrealized appreciation ................. 476,253
------------
Net Assets .......................................... $ 3,399,799
===========
Net asset value per share; 282,814 shares of
beneficial interest outstanding (Note 3) ............... $12.02
======
</TABLE>
See Notes to Financial Statements.
- 13 -
<PAGE>
<TABLE>
<CAPTION>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
Six Months Ended June 30, 1997(Unaudited)
<S> <C>
INVESTMENT INCOME
INCOME:
Dividends ...................................... $43,783
Interest ....................................... 18,792
--------
Total Income ............................... 62,575
--------
EXPENSES:
Investment advisory fee (Note 2) ........................ 14,697
Administrative fee (Note 2) ............................. 367
Shareholder servicing and related expenses (Note 2)...... 1,449
Custodian fees .......................................... 2,118
Organization costs ...................................... 1,484
Registration fees ....................................... 15,128
Professional fees ....................................... 12,647
Trustees ................................................ 5,092
Printing and mailing .................................... 601
Other ................................................... 395
--------
Total Expenses ................................. 53,978
Less: Investment advisory fee and other expenses
waived or assumed by advisor (Note 2) ....... (31,933)
--------
Net expenses ................................... 22,045
--------
Net investment income .......................... 40,530
--------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Unrealized appreciation of investments for the period ... 282,799
--------
NET INCREASE IN NET ASSETS FROM OPERATIONS .............. $323,329
========
</TABLE>
See Notes to Financial Statements.
- 14 -
<PAGE>
<TABLE>
<CAPTION>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended June 30, 1997 (Unaudited)
and Year Ended December 31, 1996
Six Months Year Ended
Ended June 30, December 31,
1997 1996
------------- ------------
<S> <C> <C>
CHANGE IN NET ASSETS FROM OPERATIONS:
Net investment income ............................ $ 40,530 $ 37,223
Net realized loss on investment .................. -- (79)
Unrealized appreciation of investments ........... 282,799 193,454
------------ ------------
Net Increase in Net Assets From Operations .. 323,329 230,598
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income ........................... (40,459) (37,233)
CAPITAL SHARE TRANSACTIONS (Note 3): ................ 578,406 2,245,158
------------ ------------
Total Increase in Net Assets ................. 861,276 2,438,523
NET ASSETS:
Beginning of period 2,538,523 100,000
------------ ------------
End of period $ 3,399,799 $ 2,538,523
============ ============
</TABLE>
See Notes to Financial Statements.
- 15 -
<PAGE>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. SUMMARY OF ACCOUNTING POLICIES
FAM Equity-Income Fund (the "Fund") is a series of Fenimore Asset
Management Trust, a no-load, diversified, open-end management company
registered under the Investment Company Act of 1940. The investment
objective of the Fund is to provide current income and long term
capital appreciation from investing primarily in income-producing
securities. The following is a summary of significant accounting
policies followed in the preparation of its financial statements.
a) VALUATION OF SECURITIES -- Securities traded on a national
securities exchange or admitted to trading on NASDAQ are valued at
the last reported sales price. Common stocks for which no sale was
reported, and over-the-counter securities, are valued at the last
reported bid price. Short term securities are carried at amortized
cost, which approximates market value.
b) 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 all of its taxable income to
its shareholders. Therefore, no provision for federal income tax is
required.
c) USE OF ESTIMATES -- The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of increases and decreases in
net assets from operations during the reporting period. Actual
results could differ from those estimates.
d) OTHER -- Securities transactions are recorded on the trade date
basis. Interest income is accrued as earned and dividend income is
recorded on the ex-dividend date. Distributions to shareholders,
which are determined in accordance with income tax regulations, are
recorded on the ex-dividend date.
NOTE 2. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Under the Investment Advisory Contract, the Fund pays an investment
advisory fee to Fenimore Asset Management, Inc. (the "Advisor") equal,
on an annual basis, to 1% of the Fund's average daily net assets.
Certain officers and trustees of the Fund are also officers and
directors of the Advisor. The Advisor is required to reimburse the Fund
for its expenses to the extent that such expenses, including the
advisory fee, for any fiscal year exceed 2% of the average daily net
assets. Although not required to do so, the Advisor further waived fees
and assumed expenses, aggregating $31,933, so as to reduce the Fund's
expense ratio to 1.5% of average daily net assets. FAM Shareholders
Services, Inc., a company under common control with the Advisor, serves
as a shareholder servicing agent for which it receives a monthly fee of
$1.75 per shareholder account. Additionally, FSS serves as the fund
administrative agent for which it receives a fee equal, on an annual
basis, to .025% of the Fund's average daily net assets.
- 16 -
<PAGE>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 3. SHARES OF BENEFICIAL INTEREST
At December 31, 1996, an unlimited number of $.001 par value shares of
beneficial interest were authorized. Transactions were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
June 30, 1997 December 31, 1996
-------------------- -------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares sold ................. 66,438 $ 740,816 224,909 $2,284,587
Shares issued on reinvestment
of dividends ............. 3,168 36,382 3,189 33,792
Shares redeemed ............. (17,825) (198,792) (7,065) (73,221)
------- --------- ------- ----------
Net increase ............. 51,781 $ 578,406 221,083 $2,245,158
======= ========= ======= ==========
</TABLE>
NOTE 4. INVESTMENT TRANSACTIONS
During the period ended June 30, 1997, purchases and sales of
investment securities, other than short term obligations, were $496,458
and $0. The cost of securities for federal income tax purposes is the
same as shown in the investment portfolio. Realized gains and losses
are reported on an identified cost basis.
The aggregate gross unrealized appreciation of portfolio securities,
based on cost for federal income tax purposes, was as follows:
Unrealized appreciation ........ $ 482,621
Unrealized depreciation ........ (6,368)
----------
Net unrealized appreciation .... $ 476,253
==========
- 17 -
<PAGE>
FAM EQUITY-INCOME FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 5. SELECTED FINANCIAL INFORMATION
<TABLE>
<S> <C> <C>
PER SHARE INFORMATION SIX MONTHS ENDED YEAR ENDED
(For a share outstanding JUNE 30, DECEMBER 31,
throughout the period) 1997 1996
----------------- -------------
Net asset value, beginning of period .. $ 10.99 $ 10.00
Income from investment operations:
Net investment income ............ 0.15 0.19
Net realized and unrealized gain
on investments ............. 1.03 0.99
Total from investment operations ...... 1.18 1.18
Less distributions:
Dividends from net investment
income ........................ 0.15 0.19
Change in net asset value for
the period ....................... 1.03 0.99
Net asset value, end of period ......... $12.02 $10.99
TOTAL RETURN ........................... 21.59* 15.90
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000) ........ $ 3,400 $2,539
Ratios to average net assets of:*
Expenses, total ....................... 1.82% 5.04%
Expenses, net of fees waived and
expenses assumed by advisor ....... 1.50% 1.50%
Net investment income ................. 2.76% 3.05%
Portfolio turnover rate ................. 0 0
Average commission rate paid
(per share) .............................$ 0.0418 $ 0.0460
<FN>
*Annualized
</FN>
</TABLE>
- 18 -
<PAGE>
INVESTMENT ADVISOR
Fenimore Asset Management, Inc.
Cobleskill, NY
CUSTODIAN
Chase Manhattan Bank, N.A.
New York, NY
TRUSTEES
Joseph J. Bulmer, PHD
Roger A. Hannay
John W. Krueger, CLU
Thomas O. Putnam
Diane C. Van Buren
Bernard H. Zais, CLU
LEGAL COUNSEL
Dechert Price & Rhoads
Washington, DC
SHAREHOLDER SERVICING AGENT
FAM Shareholder Services, Inc.
Cobleskill, NY
FAM FUNDS
111 North Grand Street
P.O. Box 399
Cobleskill, NY 12043
(800) 932-3271
