May 5, 1997
Securities and Exchange Commission
Attn: Filing Desk, Stop 1-4
450 Fifth Street, N.W.
Washington, DC 20549
Re: Professionally Managed Portfolios
File No. 811-5037
CIK No. 811030
Dear Sir or Madam:
On behalf of the above Registrant and pursuant to Rule 30b-2 under
the Investment Company Act of 1940, I enclose for filing via EDGAR,
a copy of the Semi-annual Report to shareholders of the Academy
Value Fund series of the Registrant for the six month period ended
February 28, 1997.
If you have any questions, please contact me at (602) 952-1100.
Sincerely yours,
Robert H. Wadsworth
<PAGE>
ACADEMY VALUE FUND
Semi-Annual Report
February 28, 1997
<PAGE>
ACADEMY VALUE FUND
April 3, 1997
Dear Shareholders:
The Academy Value Fund demonstrated solid performance throughout the first half
of fiscal 1997. Your Fund's Net Asset Value closed the semi-annual period at
$12.96, up 14.08% from our fiscal year end. Relative to the major indices, the
Academy Value Fund has outperformed the Dow Jones Industrial Average, S&P 500,
and NASDAQ Composite Index for the first three months of 1997.
Going forward, we continue to have a cautious outlook on the equity markets. The
market's decline during March and early April reflects investors' nervousness
about existing market valuation levels and potentially higher interest rates.
Despite forecasts to the contrary, the U.S. economy remains robust enough to
generate concerns of rising inflation. However, we view the market decline as an
opportunity to find quality companies trading at low valuation levels. Given our
increased cash position, your Fund is well positioned to take advantage of any
opportunities that meet our strict value discipline.
Sincerely,
/S/
Danny Boyce
Academy Capital Management
<PAGE>
ACADEMY VALUE FUND
<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS at February 28, 1997 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS: 96.0% Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Chemicals: 5.4%
<S> <C> <C>
2,500 Great Lakes Chemicals, Inc.............................................. $ 115,938
682 Millennium Chemicals, Inc............................................... 13,043
4,700 Sigma-Aldrich Corp...................................................... 143,937
-------
272,918
-------
Computers and Information: 3.9%
15,500 Bell Microproducts, Inc.*............................................... 168,563
1,144 Silicon Graphics, Inc................................................... 27,599
------
196,162
-------
Conglomerate: 0.5%
1,194 Hanson Trust - PLC (ADR)................................................ 26,561
------
Consumer Services: 13.2%
8,000 CPI Corp................................................................ 147,000
4,550 Deluxe Corp............................................................. 143,894
9,950 Ennis Business Forms, Inc............................................... 110,694
7,300 Franklin Quest Company*................................................. 152,387
9,500 Sealright Company, Inc.................................................. 103,313
-------
657,288
-------
Cosmetic and Personal Care Products: 1.8%
1,909 Block Drug Company, Inc., Class A*...................................... 88,768
------
Financial Services: 5.7%
12,300 London Pacific Group, Ltd. (ADR)........................................ 182,963
4,100 Union Corp.*............................................................ 99,938
------
282,901
-------
Food: 1.4%
6,100 Michael Foods, Inc...................................................... 67,863
------
Healthcare Providers: 7.4%
18,000 Novacare, Inc.*......................................................... 225,000
15,700 Transitional Hospitals Corp............................................. 141,300
-------
366,300
-------
See accompanying Notes to Financial Statements.
<PAGE>
ACADEMY VALUE FUND
SCHEDULE OF INVESTMENTS at February 28, 1997 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Industrial Products: 3.4%
6,550 Watts Industries, Inc., Class A......................................... $ 169,481
---------
Insurance: 7.4%
9,900 Amvestors Financial Corp................................................ 174,487
4,100 Security - Connecticut Corp............................................. 190,650
-------
365,137
-------
Media: 2.3%
3,100 King World Productions, Inc............................................. 115,088
-------
Medical Supplies: 3.0%
9,900 Sullivan Dental Products, Inc........................................... 147,263
-------
Pharmaceuticals: 3.8%
19,100 Huntingdon International - PLC (ADR)*................................... 188,613
-------
Retailers - Broadline: 14.7%
24,300 Bon-Ton Stores, Inc.*................................................... 156,430
3,550 Dillard Department Stores, Inc., Class A................................ 106,944
4,700 Family Dollar Stores, Inc............................................... 111,038
2,093 J.C. Penney Company, Inc................................................ 103,080
20,200 K-mart Corp.*........................................................... 252,500
-------
729,992
-------
Retailers - Specialty: 5.8%
6,650 Gibson Greeting, Inc.*.................................................. 137,155
10,400 Wolohan Lumber Company.................................................. 150,800
-------
287,955
-------
Semiconductors and Related: 1.4%
27,800 Micronics Computers, Inc................................................ 69,500
------
Shoes: 1.7%
7,800 K-Swiss, Inc., Class A (ADR)............................................ 85,800
------
Telephone Systems: 3.1%
3,900 Telefonos de Mexico SA (ADR)............................................ 151,613
-------
See accompanying Notes to Financial Statements.
<PAGE>
ACADEMY VALUE FUND
SCHEDULE OF INVESTMENTS at February 28, 1997 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Tobacco: 4.6%
2,387 Imperial Tobacco........................................................ $ 32,895
6,400 UST, Inc................................................................ 197,600
-------
230,495
-------
Utilities: 0.8%
1,194 The Energy Group - PLC (ADR)............................................ 40,588
------
Waste Management: 4.7%
4,641 Fluor Daniel/GTI, Inc................................................... 37,128
11,200 Gundle/SLT Environmental, Inc.*......................................... 84,000
8,200 Laidlaw, Inc., Class B (ADR)............................................ 113,774
-------
234,902
-------
Total Common Stocks (cost $3,945,505)................................... 4,775,188
---------
Principal Amount REPURCHASE AGREEMENT: 3.5%
- ------------------------------------------------------------------------------------------------------------------------------------
$169,000 Star Bank Repurchase Agreement, 4.85%, dated 2/28/97,
due 3/3/97, collateralized by $185,000 GNMA, due 1/20/24
(proceeds $169,067) (cost $169,000)..................................... 169,000
-------
Total Investments in Securities (cost $4,114,505+): 99.5% .............. 4,944,188
Other Assets less Liabilities: 0.5%..................................... 24,728
------
Total Net Assets: 100.0% ............................................... $4,968,916
==========
<FN>
+At February 28, 1997, the cost of securities for Federal tax purposes was the
same as the basis for financial reporting. Unrealized appreciation and
depreciation of securities were as follows:
Gross unrealized appreciation........................................... $1,014,772
Gross unrealized depreciation........................................... (185,089)
--------
Net unrealized appreciation................................... $ 829,683
=========
*Non-income producing security.
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
ACADEMY VALUE FUND
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES at February 28, 1997 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C>
Investments in securities, at value (identified cost $4,114,505) (Note 2-A) ........... $4,944,188
Cash................................................................................... 777
Receivables:
Due from Advisor................................................................. 1,527
Dividends and interest .......................................................... 6,419
Fund shares sold................................................................. 3,274
Prepaid expenses and other assets...................................................... 13,458
------
Total assets .............................................................. 4,969,643
---------
LIABILITIES
Accrued expenses payable............................................................... 727
---
NET ASSETS $4,968,916
==========
Net asset value, offering and redemption price per share
($4,968,916/383,431 shares outstanding;
unlimited number of shares authorized without par value) ........................ $12.96
======
COMPONENTS OF NET ASSETS
Paid-in capital ....................................................................... $4,087,732
Accumulated net investment loss........................................................ (2,961)
Undistributed net realized gain on investments......................................... 54,462
Net unrealized appreciation on investments............................................. 829,683
-------
Net assets ...................................................................... $4,968,916
==========
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
ACADEMY VALUE FUND
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS - For the Six Months Ended February 28, 1997 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Income:
<S> <C>
Interest......................................................................... $ 11,279
Dividends........................................................................ 29,399
------
Total income............................................................... 40,678
------
Expenses:
Advisory fees (Note 3)........................................................... 23,830
Administration fee (Note 3)...................................................... 14,876
Audit fees....................................................................... 12,347
Custodian and accounting fees.................................................... 11,713
Distribution costs (Note 4)...................................................... 5,957
Transfer agent fees.............................................................. 4,583
Miscellaneous fees............................................................... 2,325
Legal fees....................................................................... 1,879
Trustees' fees................................................................... 1,844
Reports to shareholders.......................................................... 1,065
Registration fees................................................................ 751
---
Total expenses............................................................. 81,170
Less: expenses waived/reimbursed (Note 3).................................. (32,814)
-------
Net expenses............................................................... 48,356
------
Net investment loss ................................................. (7,678)
------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain from security transactions..................................... 78,880
Net change in unrealized appreciation on investments............................. 569,040
-------
Net realized and unrealized gain on investments............................ 647,920
-------
Net Increase in Net Assets Resulting from Operations ................ $ 640,242
=========
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
ACADEMY VALUE FUND
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year
Ended Ended
February 28, August 31,
1997* 1996
- ------------------------------------------------------------------------------------------------------------------------------------
INCREASE IN NET ASSETS FROM:
OPERATIONS
<S> <C> <C>
Net investment (loss) income...................................................... $ (7,678) $ 7,790
Net realized gain (loss) from security transactions............................... 78,880 (7,792)
Net change in unrealized appreciation on investments.............................. 569,040 37,441
------- ------
Net increase in net assets resulting from operations ....................... 640,242 37,439
------- ------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS**
Net investment income............................................................. -0- (11,401)
Net realized gain from security transactions...................................... -0- (48,747)
- -------
Total dividends and distributions to shareholders .......................... -0- (60,148)
- -------
CAPITAL SHARE TRANSACTIONS
Net (decrease) increase in net assets derived from net change
in outstanding shares (a)...................................................... (332,661) 1,451,616
-------- ---------
Total increase in net assets ............................................... 307,581 1,428,907
NET ASSETS
Beginning of period............................................................... 4,661,335 3,232,428
--------- ---------
End of period (including undistributed net investment (loss) income of
($2,961) and $4,717, respectively)............................................. $4,968,916 $4,661,335
========== ==========
<FN>
(a) A summary of capital shares transactions is as follows:
Six Months Year
Ended Ended
February 28, 1997* August 31, 1996
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Value Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Shares sold.................................... 19,521 $ 233,130 231,315 $2,554,500
Shares issued in reinvestment
of distribution.......................... -0- -0- 5,756 60,148
Shares redeemed................................ (46,389) (565,791) (105,548) (1,163,032)
------- -------- -------- ----------
Net (decrease) increase........................ (26,868) $ (332,661) 131,523 $1,451,616
======= ========== ======= ==========
*Unaudited.
**See Financial Hightlights for per share data.
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
ACADEMY VALUE FUND
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a capital share outstanding throughout each period
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year December 9, 1994*
ended ended through
February 28, 1997# August 31, 1996 August 31,1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period............................. $11.36 $11.60 $10.00
------ ------ ------
Income from investment operations:
Net investment (loss) income............................... (.03) .01 .03
Net realized and unrealized gain (loss) on investments..... 1.63 (.10) 1.57
---- ---- ----
Total from investment operations................................. 1.60 (.09) 1.60
---- ---- ----
Less distributions:
From net investment income................................. -0- (.03) -0-
From net capital gains..................................... -0- (.12) -0-
- ---- -
Total distributions.............................................. -0- (.15) -0-
- ---- -
Net asset value, end of period................................... $12.96 $11.36 $11.60
====== ====== ======
Total return..................................................... 14.08%++ (0.64)% 22.68%+
Ratios/supplemental data:
Net assets, end of period (millions)............................. $ 5.0 $ 4.7 $ 3.2
Ratio of expenses to average net assets:
Before expense reimbursement and waived fee................ 3.36%+ 3.39% 5.20%+
After expense reimbursement and waived fee................. 2.00%+ 2.00% 2.00%+
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement and waived fee................ (1.70)%+ (1.20)% (2.62)%+
After expense reimbursement and waived fee................. (0.32)%+ 0.18% 0.64%+
Portfolio turnover rate.......................................... 14.42% 27.71% 13.26%
Average commission rate paid per share++++......................... $.0489 $.0536 --
<FN>
#Unaudited.
*Commencement of operations.
+Annualized.
++Not annualized.
++++For fiscal years beginning on or after September 1, 1995, a fund is required
to disclose its average commission rate per share for security trades on which
commissions are charged. This amount may vary from period to period and fund to
fund depending on the mix of trades executed in various markets where trading
practices and commission rate structures may differ.
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
ACADEMY VALUE FUND
NOTES TO FINANCIAL STATEMENTS (Unaudited)
- --------------------------------------------------------------------------------
NOTE 1 - ORGANIZATION
The Academy Value 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 investment company. The Fund began operations on December 9,
1994. The investment objective of the Fund is growth of capital. The Fund seeks
to achieve its objective by investing primarily in common stocks.
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: The Fund's investments are carried at market
value. Securities listed on an exchange or quoted on a national
market system are valued at the last sale price. Other securities
are valued at the last quoted bid price. Securities for which market
quotations are not readily available, if any, are valued at an
independent pricing service or determined following procedures
approved by the Board of Trustees. Short-term investments are valued
at amortized cost, which 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, Dividends 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.
D. 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 amount of assets and liabilities at the date of the
financial statements. Actual results could differ from those
estimates.
E. Cash and Cash Equivalents. These are funds held at the custodian
available for immediate withdrawal. The Fund's management has a
policy of reviewing the credit standing of each custodian and broker
with which it conducts business.
NOTE 3 - COMMITMENTS AND RELATED PARTY TRANSACTIONS
For the six months ended February 28, 1997, Academy Capital Management,
Inc. (the "Advisor") provided the Fund with investment management services under
an Investment Advisory Agreement. The Advisor furnishes 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
receives a monthly fee at the annual rate of 1.00% based upon the average daily
net assets of the Fund. For the six months ended February 28, 1997, the Fund
incurred $23,830 in advisory fees.
<PAGE>
ACADEMY VALUE FUND
NOTES TO FINANCIAL STATEMENTS (Unaudited), Continued
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 to 2.00% of average daily net
assets. As a result, the Advisor waived its fee and reimbursed the Fund for
expenses in excess of the limit in the amount of $8,984 for the six months ended
February 28, 1997. The Fund may reimburse the Advisor pursuant to this agreement
in later years in which operating expenses for the portfolio are less than the
applicable percentage limitation set forth previously for any such year.
Investment Company Administration Corporation (the "Administrator") acts
as the Fund's Administrator under an Administration Agreement. The Administrator
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, the Administrator receives a monthly fee at
the following annual rate:
Under $15 million $30,000
$15 to $50 million 0.20% of average net assets
$50 to $100 million 0.15% of average net assets
$100 to $150 million 0.10% of average net assets
over $150 million 0.05% of average net assets
First Fund Distributors, Inc. (the "Distributor") acts as the Fund's
principal underwriter in a continuous public offering of the Fund's shares. The
Distributor is an affiliate of the Administrator and receives no compensation
for its services.
Certain officers and trustees of the Trust are also officers and/or
directors of the Administrator and the Distributor.
NOTE 4 - 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 Distribution Coordinator appointed by the Board at an annual rate of up to
0.25% of the average daily net assets of the Fund. The Fund incurred $5,957 in
distribution expenses for the six months ended February 28, 1997.
NOTE 5 - PURCHASES AND SALES OF SECURITIES
For the six months ended February 28, 1997, the cost of purchases and the
proceeds from sales of securities, excluding short-term securities, were
$1,169,804 and $686,023, respectively.
<PAGE>
Advisor
Academy Capital Management, Inc.
500 North Valley Mills Drive
Suite 208
Waco, Texas 76710
(817) 751-0555
Distributor
First Fund Distributors, Inc.
4455 East Camelback Road
Suite 261E
Phoenix, Arizona 85018
Custodian
Star Bank, N.A.
425 Walnut Street
Cincinnati, Ohio 45202
Transfer Agent
American Data Services, Inc.
24 West Carver Street
2nd Floor
Huntington, New York 11743
Independent Auditors
Ernst & Young, LLP
515 South Flower Street
Los Angeles, California 90071
Legal Counsel
Heller, Ehrman, White & McAuliffe
333 Bush Street
San Francisco, California 94104
This report is intended for shareholders of
Academy Value Fund and may not be
used as sales literature unless preceded
or accompanied by a current prospectus.
