THE PERKINS OPPORTUNITY FUND
A mutual fund seeking to provide
capital appreciation through a
continuing search for investment opportunities
Semi-Annual Report
to Shareholders for
the Six Months Ended
September 30, 1995
<PAGE>
November 7, 1995
Dear Shareholders:
We are pleased to report an excellent 6 months for The Perkins Opportunity Fund.
The Net Asset Value per share increased from $26.06 on March 31, 1995 to $35.61
on September 30, 1995, after paying a dividend of $.619 per share. This
represents a total return of 39.46% for the six months (before the maximum sales
charge of 4.75%). The following table shows the Fund's returns by quarter and
since inception compared to several popular indices:
<TABLE>
<CAPTION>
The Perkins S&P Dow Jones NASDAQ Russell
Opportunity 500 Industrial Composite 2000
Period Fund Index Index Index Index
<S> <C> <C> <C> <C> <C>
First Quarter 1993 6.13% 4.33% 3.37% 4.00% 4.68%
Second Quarter 1993 4.90% .41% 3.08% 2.00% 1.81%
Third Quarter 1993 16.23% 2.67% 1.84% 8.36% 8.39%
Fourth Quarter 1993 7.82% 2.33% 6.31% 1.84% 2.23%
First Quarter 1994 (.78%) (3.83%) (2.51%) (4.29%) (2.78%)
Second Quarter 1994 (9.81%) .35% .39% (5.04%) (6.99%)
Third Quarter 1994 26.89% 4.98% 6.74% 8.26% 6.59%
Fourth Quarter 1994 (.22%) (.04%) .51% (1.61%) (2.25%)
First Quarter 1995 21.49% 9.77% 9.17% 8.68% 4.16%
Second Quarter 1995 17.76% 9.40% 10.30% 14.22% 8.77%
Third Quarter 1995 18.42% 8.08% 5.77% 11.79% 9.43%
Year Ended 9-30-95 69.06% 29.71% 28.03% 36.54% 21.19%
Since 2-18-93 inception 171.49% 45.44% 55.78% 57.53% 41.18%
</TABLE>
We are proud to announce that the Fund was ranked as the number three performing
capital appreciation mutual fund out of 150 funds tracked by Lipper for the year
ended September 30, 1995 (based on total return and before giving effect to
applicable sales charges). Daily quotes for the Fund are now available in most
newspapers and the Fund is now listed on NASDAQ with the symbol POFDX.
As bottom-up stock pickers we have been able to select stocks that have, on
average, outperformed the indexes. This has been accomplished through careful
research and the combination of fundamental analysis with technical chart
analysis. We see no reason that this trend should not continue as long as we are
in a healthy market environment.
<PAGE>
The following is a summary of our thoughts on the market (which are
unchanged over the last year):
We continue to believe that small-cap stocks should outperform large-cap stocks
on a relative basis over the next three to five years.
Both the stock and bond markets have experienced excellent returns over
the last 10 years and are unlikely to duplicate this performance over the
next 10 years on an overall basis. We believe the best returns will be
achieved through careful stock selection.
It is our belief that The Perkins Opportunity Fund is in an excellent position
to benefit from these future trends. As a capital appreciation oriented
portfolio, the Fund has the flexibility to invest aggressively in companies
where we see an opportunity for above average returns. As of September 30, 1995,
the Fund was 87% invested in 82 common stocks, 5 warrants and 2 convertibles.
The Fund is well diversified among industry groups and holds stocks which we
feel have good potential for above average returns, so currently its primary
risk is to a broad market decline. We are constantly looking for investment
opportunities and are confident that we will continue to find them in the future
as we have in the past.
In closing, we thank you for your confidence and support.
Sincerely,
Richard W. Perkins, CFA Daniel S. Perkins, CFA Richard C. Perkins, CFA
President Vice President Vice President
Results shown are past performance which should not be regarded as an indication
of future returns. The value of the Fund's shares and their return will
fluctuate so that an investor's shares, when redeemed, may be worth more or less
than their original cost. The Fund's average annual total return, after maximum
sales charge of 4.75%, from the period from inception on February 18, 1993
through September 30, 1995 was 43.77% and for the one year period ended on that
date was 61.04%.
<PAGE>
<TABLE>
<CAPTION>
PORTFOLIO OF INVESTMENTS at September 30, 1995 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS: 87.1% Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Business Services - Miscellaneous: 7.6%
50,000 Alternate Postal Delivery, Inc.......................................... $ 287,500
55,000 Ameridata Technologies, Inc............................................. 646,250
100,000 Appliance Recycling Centers of America, Inc............................. 650,000
5,000 Ariely Advertising, Ltd................................................. 33,125
40,000 Business Resource Group................................................. 195,000
30,000 CorVel Corp............................................................. 945,000
30,000 Eagle Pacific Industries, Inc.+......................................... 83,079
144,158 Health Fitness Physical Therapy, Inc.................................... 378,415
62,500 Health Fitness Physical Therapy, Warrants............................... 0
60,000 Health Risk Management, Inc............................................. 622,500
35,000 International Fibercom, Inc., Warrants.................................. 10,938
100,000 Marketlink, Inc......................................................... 379,687
10,000 Moovies, Inc............................................................ 196,250
10,000 Work Recovery, Inc., Class B, Warrants+................................. 4,500
-----
4,432,244
---------
Computer - Integrated System: 1.7%
25,000 Gateway 2000, Inc....................................................... 765,625
10,000 Mentor Graphics Corp.................................................... 205,000
-------
970,625
-------
Computer - Local Networks: 7.2%
145,000 Ancor Communications, Inc............................................... 815,625
25,000 Digi International, Inc................................................. 706,250
50,000 Interphase Corp......................................................... 731,250
45,000 Lanoptics, Ltd. ORD..................................................... 697,500
45,000 Networth, Inc........................................................... 936,563
6,000 Security Dynamics Technologies, Inc..................................... 286,500
-------
4,173,688
---------
Computer - Peripheral Equipment: 7.9%
110,000 Check Technology Corp................................................... 818,125
110,000 Ciprico, Inc............................................................ 1,210,000
50,000 Digital Biometrics, Inc................................................. 356,250
17,500 Microfield Graphics, Inc................................................ 177,187
73,000 Mizar, Inc.............................................................. 666,125
</TABLE>
<PAGE>
PORTFOLIO OF INVESTMENTS at September 30, 1995 (Unaudited), Continued
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Computer - Peripheral Equipment, continued
35,000 Mylex Corp.............................................................. $ 595,000
35,000 Percon, Inc............................................................. 402,500
25,000 RSI Systems, Inc........................................................ 231,250
50,000 VideoLabs, Inc.......................................................... 107,031
-------
4,563,468
---------
Computer - Software: 6.6%
10,000 Across Data Systems, Inc................................................ 75,000
38,500 Applied Digital Access, Inc............................................. 490,875
200,000 Fourth Shift Corp....................................................... 1,075,000
90,000 IVI Publishing, Inc..................................................... 877,500
64,500 Interactive Group, Inc.................................................. 427,313
65,000 Liferate Systems, Inc................................................... 511,875
40,000 Mustang Software, Inc................................................... 360,000
-------
3,817,563
---------
Consumer Products - Miscellaneous: 5.3%
85,000 Koala Corp.............................................................. 711,875
140,000 Minnesota Brewing Co.................................................... 630,000
12,900 Polaris Industries, Inc.*............................................... 569,213
200,000 Ringer Corporation...................................................... 312,500
30,000 Simula, Inc............................................................. 753,750
25,500 WTC Industries, Inc..................................................... 89,250
------
3,066,588
---------
Electrical Products - Miscellaneous: 7.6%
15,000 Advanced Micro Devices, Inc............................................. 436,875
18,750 Aetrium, Inc............................................................ 403,125
35,000 Ametek, Inc.*........................................................... 599,375
27,700 Coin Bill Validator, Inc................................................ 207,750
225,000 Micro Component Technology, Inc.+....................................... 1,241,691
45,000 Richey Electronics, Inc................................................. 393,750
85,000 Video Sentry Corp....................................................... 1,115,625
---------
4,398,191
---------
Food - Miscellaneous Preparation: 1.4%
60,000 Michael Foods, Inc.*.................................................... 802,500
-------
</TABLE>
<PAGE>
PORTFOLIO OF INVESTMENTS at September 30, 1995 (Unaudited), Continued
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Leisure - Gaming: 6.7%
95,500 Acres Gaming, Inc....................................................... $ 740,125
25,000 Canterbury Park Holdings, Inc., Warrants................................ 9,375
100,000 Gaming Corporation of America........................................... 700,000
3,000 Grand Casinos, Inc...................................................... 121,875
85,000 Innovative Gaming Corporation America................................... 626,875
60,000 Lotto World, Inc........................................................ 360,000
70,000 Shuffle Master, Inc., Warrants.......................................... 980,000
40,000 Stratosphere Corporation................................................ 347,500
-------
3,885,750
---------
Medical - Biomed/Genetics: 4.3%
139,900 Incstar Corp............................................................ 655,025
75,000 Oncor, Inc.............................................................. 557,812
60,000 Somatogen, Inc.......................................................... 1,267,500
---------
2,480,337
---------
Medical - Ethical Drugs: 3.2%
40,000 Chronimed, Inc.......................................................... 520,000
31,000 Duramed Pharmaceuticals................................................. 441,750
125,000 Orphan Medical, Inc..................................................... 921,875
-------
1,883,625
---------
Medical - Products: 17.4%
125,000 Angeion Corp............................................................ 937,500
120,000 ATS Medical, Inc........................................................ 1,050,000
20,000 ATS Medical, Inc., Warrants............................................. 11,250
45,000 AVECOR Cardiovascular, Inc.............................................. 630,000
25,000 Bio-Vascular, Inc....................................................... 450,000
83,325 Cooper Companies, Inc................................................... 666,600
30,000 Curative Technologies, Inc.............................................. 423,750
78,000 Diametrics Medical, Inc................................................. 887,250
300,000 Everest Medical Corp.................................................... 881,250
100,000 Fischer Imaging Corp.................................................... 875,000
10,000 InnerDyne, Inc., Warrants............................................... 0
187,000 InnerDyne Medical, Inc.................................................. 631,125
50,000 InnerDyne, Inc., Units+................................................. 132,654
8,500 Mentor Corporation ................................................... 386,750
100,000 Spectra Science, Inc., Convertible Preferred+........................... 352,500
</TABLE>
<PAGE>
PORTFOLIO OF INVESTMENTS at September 30, 1995 (Unaudited), Continued
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Medical - Products, continued
138,100 Spectrascience, Inc..................................................... $ 759,550
300,000 Spectranetics Corp...................................................... 1,031,250
---------
10,106,429
----------
Retail - Miscellaneous/Diversified: 5.1%
115,000 Brauns Fashions Corp.................................................... 186,875
110,000 Pet Food Warehouse, Inc................................................. 453,750
100,000 Rainforest Cafe, Inc.................................................... 2,325,000
---------
2,965,625
---------
Telecommunications - Equipment & Services: 5.1%
45,000 Intervoice, Inc......................................................... 1,029,375
10,000 Norstan, Inc............................................................ 260,000
110,000 Racotek, Inc............................................................ 673,750
40,000 Vtel Corp............................................................... 995,000
-------
2,958,125
---------
Total Common Stocks (cost $40,204,322).................................. 50,504,758
----------
</TABLE>
<TABLE>
<CAPTION>
Principal Amount REPURCHASE AGREEMENTS: 12.4%
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
$7,167,671 Provident Bank Repurchase Agreement, 6.25%, dated 9/29/1995, due
10/2/1995, collateralized by $10,805,232 FHLMC, due 5/15/2018
(proceeds $7,171,404) (cost $7,167,671)................................. 7,167,671
---------
Total Investment in Securities (cost $47,371,993++): 99.5%............... 57,672,429
Other Assets less Liabilities: 0.5%..................................... 270,456
-------
Total Net Assets: 100.0%................................................ $57,942,885
===========
<FN>
*Indicates income producing security.
+Restricted security; see Note 3 of Notes to Financial Statements.
++Cost for federal income tax purposes is the same.
</FN>
</TABLE>
<TABLE>
<S> <C> <C>
Net unrealized appreciation consists of:
Gross unrealized appreciation .......................................... $12,173,464
Gross unrealized depreciation .......................................... (1,873,028)
----------
Net unrealized appreciation .................................. $10,300,436
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES at September 30, 1995 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Investments in securities, at value (identified cost $47,371,993) (Note 2-A) .......... $57,672,429
Receivables:
Capital stock sold............................................................... 608,175
Dividends and interest........................................................... 40,864
Investment securities sold ...................................................... 1,282,250
Prepaid expenses....................................................................... 11,478
------
Total assets .............................................................. 59,615,196
----------
LIABILITIES
Payable for investment securities purchased............................................ 1,552,130
Payable for Fund shares repurchased.................................................... 2,000
Dividends payable...................................................................... 2,835
Payable to Advisor..................................................................... 44,147
Payable to Manager..................................................................... 10,891
Distribution costs payable............................................................. 45,934
Accrued expenses ...................................................................... 14,374
------
Total liabilities ......................................................... 1,672,311
---------
NET ASSETS .............................................................................. $57,942,885
===========
Net asset value and redemption price per share
($57,942,885/1,627,003 shares outstanding;
unlimited number of shares authorized without par value) ..................... $35.61
======
Computation of offering price per share
(Net asset value $35.61/.9525) .................................................. $37.39
======
SOURCE OF NET ASSETS
Paid-in capital ....................................................................... $46,443,724
Accumulated net investment loss........................................................ (189,845)
Undistributed net realized gain on investments ........................................ 1,388,570
Net unrealized appreciation of investments ............................................ 10,300,436
----------
Net assets ...................................................................... $57,942,885
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS - For the Six Months Ended September 30, 1995
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends ....................................................................... $ 34,291
Interest......................................................................... 100,636
-------
134,927
-------
Distribution costs (Notes 4 and 5) .............................................. 39,743
Administrative Manager's fee (Note 4) ........................................... 39,598
Investment Advisor's fee (Note 4) ............................................... 158,972
Custodian and accounting fees ................................................... 4,565
Shareholder services fees........................................................ 18,043
Transfer agent fees ............................................................. 13,788
Auditing fees ................................................................... 5,956
Legal fees...................................................................... 4,715
Shareholder reports ............................................................. 4,159
Trustees' fees .................................................................. 1,504
Registration fees................................................................ 28,700
Insurance ....................................................................... 2,277
Miscellaneous ................................................................... 2,752
-----
Total expenses ............................................................ 324,772
-------
Net investment loss ................................................. (189,845)
--------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain from security transactions .................................... 1,326,470
Net increase in unrealized appreciation of investments .......................... 8,944,844
---------
Net realized and unrealized gain on investments ........................... 10,271,314
----------
Net Increase in Net Assets Resulting from Operations ................ $10,081,469
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended
September 30, March 31,
1995* 1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE IN NET ASSETS FROM:
OPERATIONS:
Net investment loss ........................................................... $ (189,845) $ (115,672)
Net realized gain from security transactions .................................. 1,326,470 1,115,327
Net increase in unrealized appreciation of investments ........................ 8,944,844 1,034,485
--------- ---------
Net increase in net assets resulting from operations .................... 10,081,469 2,034,140
---------- ---------
DISTRIBUTIONS TO SHAREHOLDERS:
Net realized gain from securities transactions ($0.62 and $2.00 per share,
respectively) ........................................................... (603,782) (427,036)
-------- --------
CAPITAL SHARE TRANSACTIONS:
Net increase in net assets derived from net change in outstanding shares (a)... 35,980,550 7,624,217
---------- ---------
Total increase in net assets ............................................ 45,458,237 9,231,321
NET ASSETS:
Beginning of period............................................................ 12,484,648 3,253,327
---------- ---------
End of period ................................................................. $57,942,885 $12,484,648
=========== ===========
</TABLE>
(a) A summary of capital share transactions is as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
September 30, 1995* March 31, 1995
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Value Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold ...................................... 1,194,197 $37,518,716 316,900 $7,553,877
Shares reissued in connection with payment of
dividends .................................. 17,611 531,176 19,055 381,629
Shares redeemed .................................. (63,829) (2,069,342) (13,896) (311,289)
------- ---------- ------- --------
Net increase ..................................... 1,147,979 $35,980,550 322,059 $7,624,217
========= =========== ======= ==========
<FN>
*Unaudited.
</FN>
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
for a capital share outstanding throughout each period
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year Year Feb. 18, 1993*
Ended Ended Ended through
September March 31, March 31, March 31,
30, 1995** 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........................... $26.06 $20.73 $15.92 $15.00
Income from investment operations:
Net investment loss ...................................... (.12) (.25) (.27) (.02)
Net realized and unrealized gain on investments........... 10.29 7.58 5.40 .94
----- ---- ---- ---
Total from investment operations................................ 10.17 7.33 5.13 .92
----- ---- ---- ---
Less distributions:
Dividends from net investment income...................... -0- -0- -0- -0-
Distributions from net capital gains ..................... (.62) (2.00) (.32) -0-
---- ----- ---- ----
Total distributions............................................. (.62) (2.00) (.32) -0-
---- ----- ---- ----
Net asset value, end of period ................................. $35.61 $26.06 $20.73 $15.92
====== ====== ====== ======
Total return ................................................... 94.14%+ 38.72% 32.22% 28.37%+
Ratios/supplemental data:
Net assets, end of period (millions)............................ $57.9 $12.5 $3.3 $1.0
Ratio of expenses to average net assets:
Before expense reimbursement ............................. 2.03%+ 3.08% 5.14% 13.15%+
After expense reimbursement............................... 2.03%+ 2.63% 2.49% 2.42%+
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement ............................. (1.18%)+ (2.76%) (4.93%) (12.38%)+
After expense reimbursement .............................. (1.18%)+ (2.31%) (2.28%) (1.65%)+
Portfolio turnover rate ........................................ 36.99% 124.86% 90.63% 15.15%
<FN>
*Commencement of operations.
**Unaudited.
+Annualized.
</FN>
</TABLE>
See accompanying notes to financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS at September 30, 1995 (Unaudited)
- --------------------------------------------------------------------------------
NOTE 1 - ORGANIZATION
The Perkins Opportunity Fund (the "Fund") is a series of shares of
beneficial interest of Professionally Managed Portfolios (the "Trust"), which is
registered under the Investment Company Act of 1940 (the "1940 Act") as a
diversified, open-end management company. The Fund began operations on February
18, 1993.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund. These policies are in conformity with generally accepted
accounting principles.
A. Security Valuation. Investments in securities traded on a national
securities exchange or included in the NASDAQ National Market System
are valued at the last reported sale price at the close of regular
trading on the last business day of the period; securities traded on
an exchange or NASDAQ for which there has been no sale and other
over-the-counter securities are valued at the last reported bid
price. Securities for which quotations are not readily available are
valued at their respective fair values as determined in good faith
by the Board of Trustees. Short-term investments are stated at cost,
which when combined with accrued interest, approximates market
value.
B. Federal Income Taxes. The Fund intends 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
federal income tax provision is required.
C. Security Transactions, Interest Income and Distributions. As is
common in the industry, security transactions are accounted for on
the trade date. Dividend income and distributions to shareholders
are recorded on the ex-dividend date. Interest income is recognized
on a accrual basis. Income and capital gains distributions to
shareholders are determined in accordance with income tax
regulations which may differ from Generally Accepted Accounting
Principles. Those differences are primarily due to differing
treatments for net operating losses.
NOTE 3 - RESTRICTED SECURITIES
On September 30, 1995, the Fund held restricted securities (i.e.,
securities which may not be publicly sold without registration under the
Securities Act or without an exemption under that Act). These securities are
valued at fair value as determined by the Board of Trustees, giving
consideration to credit quality, dividend rate, if any, projected earnings and
marketability of the securities of comparable issuers. On September 30, 1995 and
on the dates of acquisition, there were no market quotations available for
unrestricted securities of the same class. Dates of acquisition and cost of
restricted securities are as follows:
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited), Continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Acquisition Date Cost
<S> <C> <C>
Eagle Pacific Industries, 7% Cv. Pfd., $2.00 December 17, 1993 $ 60,000
InnerDyne, Inc. June 2, 1995 113,000
Micro Component Technology, Inc. August 15, 1995 703,125
Spectra Science Convertible Preferred September 19, 1995 300,000
Work Recovery, Inc. June 3, 1993 0
-------
Total restricted securities (fair value of $1,814,424 was 3.1% of net assets at
September 30, 1995) $1,176,125
==========
</TABLE>
NOTE 4 - INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
For the period ended September 30, 1995, Perkins Capital Management, Inc.
(the "Advisor") provided the Fund with investment management services under an
Investment Advisory Agreement. The Advisor furnished all investment advice,
office space and certain administrative services, and provides most of the
personnel needed by the Fund. As compensation for its services, the Advisor was
entitled to a monthly fee at the annual rate of 1.00% based upon the average
daily net assets of the Fund.
The Fund is responsible for its own operating expenses. The Advisor has
agreed to reduce fees payable to it by the Fund to the extent necessary to limit
the Fund's aggregate annual operating expenses, exclusive of interest on
borrowings, to the most stringent limits prescribed by any state in which the
Fund's shares are offered for sale. Currently, the expense limit is 2.50% on the
first $30 million of net assets and reduced amounts thereafter. The Fund did not
exceed the expense limit during the period ended September 30, 1995.
Southampton Investment Management Company (the "Manager") acts as the
Fund's Manager under an Investment Management Agreement. The Manager prepares
various federal and state regulatory filings, reports and returns for the Fund;
prepares reports and materials to be supplied to the trustees; monitors the
activities of the Fund's custodian, transfer agent and accountants; coordinates
the preparation and payment of Fund expenses and reviews the Fund's expense
accruals. For its services to the Fund, the Administrative Manager receives an
annual fee based upon average net assets of the Fund as follows: the greater of
$30,000 or 0.25% for the first $50 million, 0.20% for the next $50 million,
0.15% for the next $100 million, and 0.10% thereafter.
First Fund Distributors, Inc. (the "Distributor") acts as the Fund's
principal underwriter in a continuous public offering of the Fund's shares.
Certain officers and Trustees of the Fund are also officers and/or
directors of the Manager and Distributor.
NOTE 5 - DISTRIBUTION COSTS
The Fund has adopted a Distribution Plan (the "Plan") in accordance with
Rule 12b-1 under the 1940 Act. The Plan provides that the Fund will pay a fee to
the Distributor at an annual rate of up to 0.25% of the average daily net assets
of the Fund. The fee is paid to the Distributor as reimbursement for, or in
anticipation of, expenses incurred for distribution-related activity.
During the period ended September 30, 1995, the Fund paid fees of $57,787 to the
Distributor.
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited), Continued
- --------------------------------------------------------------------------------
NOTE 6 - SHAREHOLDER SERVICES FEE
The Fund has entered into a Shareholder Service Agreement with the
Distributor, under which the Fund pays servicing fees at an annual rate of up to
0.25% of the Fund's average daily net assets. Payments to the Distributor under
the Shareholder Servicing Agreement may reimburse the Distributor for payments
it makes to selected brokers, dealers and administrators which have entered into
Service Agreements with the Distributor for services provided to shareholders of
the Fund. The services provided by such intermediaries are primarily designed to
assist shareholders of the Fund and include the furnishing of office space and
equipment, telephone facilities, personnel and assistance to the Fund in
servicing such shareholders. Services provided by such intermediaries also
include the provision of support services to the Fund and include establishing
and maintaining shareholders' accounts and records, processing purchase and
redemption transactions, answering routine client inquires regarding the Fund,
and providing such other personal services to shareholders as the Fund may
reasonably request.
NOTE 7 - PURCHASES AND SALES OF SECURITIES
For the period ended September 30, 1995, the cost of purchases and the
proceeds from sales of securities, excluding short-term securities, were
$39,875,977 and $10,809,151, respectively.
<PAGE>
Advisor
Perkins Capital Management, Inc.
730 East Lake Street
Wayzata, MN 55391-1769
(800) 366-8361
(612) 473-8367
o
Distributor
First Fund Distributors, Inc.
4455 East Camelback Road, Suite 261E
Phoenix, AZ 85018
o
Custodian
The Provident Bank
One East Fourth Street
Cincinnati, OH 45250-0967
o
Transfer Agent and Shareholder Service
Rodney Square Management Corporation
1100 North Market Street
Wilmington, DE 19890-0001
(800) 427-4779
o
Auditors
Tait, Weller & Baker
2 Penn Center Plaza
Philadelphia, PA 19102
o
Legal Counsel
Heller, Ehrman, White & McAuliffe
333 Bush Street
San Francisco, CA 94104
This report is intended for shareholders of
The Perkins Opportunity Fund and may not
be used as sales literature unless preceded
or accompanied by a current prospectus.
