December 8, 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 Hodges Fund
series of the Registrant for the six month period ended September
30, 1997.
If you have any questions, please contact me at (602) 952-1100.
Sincerely yours,
/s/
Robert H. Wadsworth
<PAGE>
Hodges Fund
Designed
for Investors
Who Want Growth
Semi-Annual Report
For the Six Months Ended
September 30, 1997
<PAGE>
Hodges Fund
November 13, 1997
Dear Hodges Fund Shareholders:
Once again allow me to thank you for being a shareholder of the Hodges Fund. I
trust that you have been pleased with your investment.
I am happy to inform you that, since our last report, we have acquired enough
shareholders and assets to qualify for listing on a regular basis in most of the
major financial publications. This provides you with a source for checking our
quoted price daily. There are a few papers that don't yet include us in their
list. If your daily paper is one of them, a call from you might encourage your
paper to list our price. This information is available to them in their data
bank sources.
For the period ending September 30, 1997, our cumulative total return since
inception, October 9, 1992, was 153.43%. Our average annual total return was
20.54%. For the past three years, our average annual total return has been
30.26%. Our total return for the past 12 months was 43.35%.
If you have friends or family members who would like a copy of our prospectus,
just call 800-456-1979 and one will be sent to them immediately.
Sincerely,
/s/
DON W. HODGES
<PAGE>
Hodges Fund
<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS at September 30, 1997 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS: 93.1% Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Aircraft Manufacturing: 0.9%
<S> <C> <C>
5,000 Boeing Company.......................................................... $ 272,187
---------
Airlines: 2.2%
20,000 Southwest Airlines Company.............................................. 638,750
-------
Auto Manufacturing: 2.3%
10,000 General Motors Corp..................................................... 669,375
-------
Broadcasting and Communications: 1.7%
17,500 Westinghouse Electric Corp.............................................. 473,594
-------
Building Materials: 6.6%
10,000 Elcor Corp.*............................................................ 319,375
15,000 NCI Building System, Inc.*.............................................. 540,000
15,000 Triangle Pacific Corp.*................................................. 521,250
15,000 Zurn Industries, Inc.................................................... 519,375
-------
1,900,000
---------
Commercial Services: 0.3%
45,000 The Dwyer Group, Inc.*.................................................. 78,750
------
Computer, Software and Networking: 4.6%
10,000 American Power Conversion Corp.*........................................ 281,250
70,000 ODS Networks, Inc.*..................................................... 940,625
25,000 Plaintree Systems, Inc.*................................................ 96,875
------
1,318,750
---------
Confectionaries: 3.9%
10,000 Tootsie Roll Industries, Inc............................................ 507,500
8,000 William Wrigley, Jr. Company............................................ 602,500
-------
1,110,000
---------
Construction Equipment: 3.0%
185,000 CMI Corp., Class A...................................................... 867,188
-------
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
SCHEDULE OF INVESTMENTS at September 30, 1997 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Construction Materials: 3.7%
25,000 Texas Industries, Inc................................................... $ 1,060,938
-----------
Consumer Products: 1.6%
207,500 Pentech International, Inc.*+........................................... 468,073
-------
Correctional: 3.0%
40,000 Children's Comprehensive Services, Inc.................................. 860,000
-------
Electronic Security Devices: 1.9%
45,000 Ultrak, Inc.*........................................................... 551,250
-------
Entertainment: 2.2%
20,000 Gaylord Entertainment Company, Class A*................................. 516,250
5,000 International Speedway Corp., Class A................................... 105,000
-------
621,250
-------
Financial: 3.6%
40,000 Capstead Mortgage Corp.................................................. 1,040,000
---------
Food Products: 1.5%
10,000 Earthgrains Company*.................................................... 430,000
-------
Gas Distribution: 1.7%
20,000 Atmos Energy Corp....................................................... 497,500
-------
Home Manufacturing: 1.9%
18,750 Palm Harbor Homes, Inc.*................................................ 553,125
-------
Hotels/Motels: 2.2%
7,500 Bristol Hotel Company................................................... 209,531
6,000 Marriott International, Inc............................................. 426,375
-------
635,906
-------
Insurance: 0.7%
20,000 Gainsco, Inc............................................................ 193,750
-------
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
SCHEDULE OF INVESTMENTS at September 30, 1997 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Medical - Related Services: 5.8%
80,000 Diagnostic Health Services, Inc.*....................................... $ 1,210,000
1,000 Incyte Pharmaceuticals, Inc.*........................................... 84,000
114,500 Laboratory Specialists of America, Inc.*................................ 364,969
-------
1,658,969
---------
Oil and Gas Drilling: 1.2%
10,000 Global Marine, Inc.*.................................................... 332,500
-------
Oil and Gas Production: 0.9%
4,000 Texaco, Inc............................................................. 245,750
-------
Pharmaceuticals: 2.2%
10,000 Agouron Pharmaceuticals, Inc.*.......................................... 481,250
10,000 Carter-Wallace, Inc..................................................... 165,000
-------
646,250
-------
Publishing - Books: 4.5%
20,000 Houghton Mifflin Company................................................ 755,000
40,000 Thomas Nelson, Inc...................................................... 555,000
-------
1,310,000
---------
Real Estate: 3.3%
10,000 Texas Pacific Land Trust................................................ 559,375
15,000 Walden Residential Properties, Inc...................................... 378,750
-------
938,125
-------
Restaurants: 2.6%
20,000 Cracker Barrel Old Country Store Corp................................... 647,500
5,000 Luby's Cafeterias, Inc.................................................. 104,062
-------
751,562
-------
Retail: 13.5%
245,400 Calloway's Nursery, Inc.*............................................... 314,419
20,000 Costco Companies, Inc.*................................................. 752,500
15,000 Cross-Continent Auto Retailers, Inc.*................................... 201,562
310,500 E-Z Serve Corp.*........................................................ 213,469
15,000 Home Depot, Inc. ....................................................... 781,875
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
SCHEDULE OF INVESTMENTS at September 30, 1997 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Retail, continued
20,000 Kmart Corp.*............................................................ $ 280,000
10,000 Neiman Marcus Group, Inc.*.............................................. 320,000
20,000 Office Depot, Inc.*..................................................... 403,750
100,000 Southland Corp.*........................................................ 256,250
10,000 Wal-Mart Stores, Inc.................................................... 366,250
-------
3,890,075
---------
Shoe and Boots Manufacturing: 3.9%
26,500 Justin Industries....................................................... 356,094
20,000 Rocky Shoes & Boots, Inc.*.............................................. 361,250
30,000 Stride Rite Corp........................................................ 406,875
-------
1,124,219
---------
Stock Brokerage: 3.9%
22,500 Charles Schwab Corp..................................................... 804,375
7,000 E*Trade Group, Inc.*.................................................... 329,000
-------
1,133,375
---------
Venture Capital: 1.8%
5,500 Capital Southwest Corp.................................................. 404,937
90,000 Southern Venture II LP*................................................. 120,174
-------
525,111
-------
Total Common Stocks (cost $21,161,008) ................................. 26,796,322
----------
WARRANTS: 0.8%
- ------------------------------------------------------------------------------------------------------------------------------------
Retail: 0.8%
15,000 Zale Corp.* (cost $176,417)............................................. 236,250
-------
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
SCHEDULE OF INVESTMENTS at September 30, 1997 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Contracts Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stocks / Expiration Date / Exercise Price
- ------------------------------------------------------------------------------------------------------------------------------------
20 AMR Corp. / November 90 Call............................................ $ 43,000
30 Kent Electronic Corp. / January 30 Call................................. 30,750
30 Texas Instruments / October 90 Call..................................... 136,125
-------
Total Long Equity Options (cost $154,152)............................... 209,875
-------
LONG INDEX OPTIONS: 3.6%
- ------------------------------------------------------------------------------------------------------------------------------------
Index / Expiration Date / Exercise Price
- ------------------------------------------------------------------------------------------------------------------------------------
50 OEX Index S&P 100 / November 980 Put.................................... 355,625
65 OEX Index S&P 100 / November 990 Put.................................... 515,125
25 OEX Index S&P 100 / November 970 Put.................................... 158,438
-------
Total Long Index Options (cost $1,417,450).............................. 1,029,188
---------
Principal Amount REPURCHASE AGREEMENT: 2.3%
- ------------------------------------------------------------------------------------------------------------------------------------
$670,000 Star Bank Repurchase Agreement, 5.45%, dated 9/30/1997,
due 10/1/1997, collateralized by $670,000 GNMA, due
2/20/2024 (value of collateral $686,750) (cost $670,000)................ 670,000
-------
Total Investment in Securities (cost $23,579,027++): 100.5%.............. 28,941,635
Liabilities in excess of Other Assets: (0.5%)........................... (148,987)
--------
Total Net Assets: 100.0%................................................ $28,792,648
===========
<FN>
* Non-income producing security.
+ Restricted security.
++ At September 30, 1997, the cost of securities for Federal tax purposes was
the same basis for financial reporting. Unrealized appreciation and depreciation
of securities were as follows:
Gross unrealized appreciation........................................... $ 6,057,152
Gross unrealized depreciation........................................... (694,544)
--------
Net unrealized appreciation.................................... $ 5,362,608
===========
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES at September 30, 1997 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C>
Investments in securities, at value (cost $23,579,027) ................................ $28,941,635
Cash................................................................................... 641
Receivables:
Dividends and interest .......................................................... 2,941
Investment securities sold....................................................... 280,516
Fund shares sold ................................................................ 24,086
Prepaid expenses....................................................................... 13,126
------
Total assets .............................................................. 29,262,945
----------
LIABILITIES
Payables:
Administration fee............................................................... 4,591
Advisory fees.................................................................... 19,510
Distribution fees................................................................ 32,749
Fund shares redeemed............................................................. 5,000
Investment securities purchased.................................................. 406,625
Accrued expenses ...................................................................... 1,822
-----
Total liabilities.......................................................... 470,297
-------
NET ASSETS ................................................................................. $28,792,648
===========
Net asset value and redemption price per share
($28,792,648/1,794,598 shares outstanding;
unlimited shares authorized without par value) .................................. $16.04
======
Computation of offering price per share
(Net asset value $16.04/.975).................................................... $16.45
======
COMPONENTS OF NET ASSETS
Paid-in capital ....................................................................... $20,914,003
Accumulated net investment loss........................................................ (89,491)
Undistributed net realized gain on investments ........................................ 2,605,528
Net unrealized appreciation on investments............................................. 5,362,608
---------
Net assets ...................................................................... $28,792,648
===========
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS - For the Six Months Ended September 30, 1997
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Income
<S> <C>
Dividends........................................................................ $ 115,508
Interest ........................................................................ 22,499
------
Total income .............................................................. 138,007
-------
Expenses
Advisory fees ................................................................... 100,945
Distribution fees................................................................ 59,379
Administration fee............................................................... 23,752
Custodian and accounting fees.................................................... 15,041
Registration fees ............................................................... 7,922
Transfer agent fees.............................................................. 7,521
Audit fees ...................................................................... 6,017
Trustees' fees .................................................................. 1,504
Reports to shareholders.......................................................... 1,504
Miscellaneous.................................................................... 1,504
Legal fees ...................................................................... 1,254
Insurance fees................................................................... 1,155
-----
Total expenses............................................................. 227,498
-------
Net investment loss ............................................... (89,491)
-------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain from security transactions .......................................... 3,094,025
Net change in unrealized appreciation on investments .................................. 4,529,857
---------
Net realized and unrealized gain on investments ........................... 7,623,882
---------
Net Increase in Net Assets Resulting from Operations ................ $ 7,534,391
===========
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year
Ended Ended
September 30, March 31,
1997# 1997
- ------------------------------------------------------------------------------------------------------------------------------------
INCREASE IN NET ASSETS FROM:
OPERATIONS
<S> <C> <C>
Net investment loss........................................................ $ (89,491) $ (158,367)
Net realized gain from security transactions .............................. 3,094,025 3,206,306
Net change in unrealized appreciation on investments....................... 4,529,857 (904,746)
--------- --------
Net increase in net assets resulting from operations ............... 7,534,391 2,143,193
--------- ---------
DISTRIBUTIONS TO SHAREHOLDERS
Net realized gain from security transactions............................... (2,091,217) (1,706,975)
---------- ----------
CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived from net change
in outstanding shares (a) .............................................. 3,927,008 5,714,684
--------- ---------
Total increase in net assets ........................................ 9,370,182 6,150,902
NET ASSETS
Beginning of period........................................................ 19,422,466 13,271,564
---------- ----------
End of period (including accumulated net investment loss
of $89,491 and $0, respectively)....................................... $28,792,648 $19,422,466
=========== ===========
<FN>
(a) A summary of capital shares transactions is as follows:
Six Months Ended Year Ended
September 30, 1997# March 31, 1997
Shares Value Shares Value
Shares sold ...................................... 197,982 $2,585,281 385,232 $5,092,543
Shares issued in reinvestment of distribution .... 178,590 2,078,792 113,132 1,399,627
Shares redeemed .................................. (52,927) (737,065) (58,775) (777,486)
------- -------- ------- --------
Net increase ..................................... 323,645 $3,927,008 439,589 $5,714,684
======= ========== ======= ==========
#Unaudited.
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
Hodges Fund
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a capital share outstanding throughout each period
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year Year Year Year Oct. 9, 1992*
Ended Ended Ended Ended Ended through
September 30, March 31, March 31, March 31, March 31, March 31,
1997# 1997 1996 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ... $13.20 $12.87 $11.55 $10.80 $11.78 $10.25
Income from investment operations:
Net investment income (loss) ..... (.05) (.11) (.07) (.08) (.03) .02
Net realized and unrealized
gain on investments ........... 4.30 1.85 3.42 1.09 .07 1.51
---- ---- ---- ---- --- ----
Total from investment operations........ 4.25 1.74 3.35 1.01 .04 1.53
---- ---- ---- ---- --- ----
Less distributions:
From net investment income........ -0- -0- -0- -0- (.01) -0-
From net capital gains ........... (1.41) (1.41) (2.03) (.26) (1.01) -0-
----- ----- ----- ---- ----- -
Total distributions..................... (1.41) (1.41) (2.03) (.26) (1.02) -0-
----- ----- ----- ---- ----- -
Net asset value, end of period ......... $16.04 $13.20 $12.87 $11.55 $10.80 $11.78
====== ====== ====== ====== ====== ======
Total return ........................... 36.23% 14.18% 32.33% 9.60% 0.22% 25.59%+
Ratios/supplemental data:
Net assets, end of period (millions).... $ 28.8 $ 19.4 $ 13.3 $ 9.3 $ 8.5 $ 6.9
Ratio of expenses to average net assets:
Before expense reimbursement ..... 1.91%+ 2.14% 2.08% 2.31% 2.63% 2.17%+
After expense reimbursement....... 1.91%+ 2.14% 2.08% 2.31% 2.07% 2.17%+
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement ..... (0.75%)+ (0.95%) (0.61%) (0.75%) (0.84%) 0.41%+
After expense reimbursement ...... (0.75%)+ (0.95%) (0.61%) (0.75%) (0.29%) 0.41%+
Portfolio turnover rate ................ 61.16% 115.77% 124.89% 73.65% 192.03% 26.23%
Average commision rate paid per share++.. $.0301 $.0331 - - - -
<FN>
*Commencement of operations.
#Unaudited.
+Annualized.
++For fiscal years beginning on or after September 1, 1995, a fund is required
to disclose its average commission rate paid 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>
Hodges Fund
NOTES TO FINANCIAL STATEMENTS at September 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
NOTE 1 - ORGANIZATION
Hodges 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 non-diversified, open-end
management investment company. The Fund's primary investment objective is
capital appreciation. The Fund began operations on October 9, 1992.
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 sales 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 have been no sales 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.
U.S. Government securities with less than 60 days remaining to
maturity when acquired by the Fund are valued on an amortized cost
basis. U.S. Government securities with more than 60 days remaining to
maturity are valued at the current market value (using the mean
between the bid and asked price) until the 60th day prior to
maturity, and are then valued at amortized cost based upon the value
on such date, unless the Board determines during such 60-day period
that this amortized cost basis does not represent fair 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, Investment Income and Distributions. As is
common in the industry, security transactions are accounted for on
the trade date. The cost of securities owned on realized transactions
are relieved on a first-in, first-out basis. Dividend income and
distributions to shareholders are recorded on the ex-dividend date.
D. Use of Estimates. The preparation 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 at the date of the financial statements.
Actual results could differ from those estimates.
<PAGE>
Hodges Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited), Continued
- --------------------------------------------------------------------------------
NOTE 3 - RESTRICTED SECURITIES
On September 30, 1997, 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, 1997,
and on the date 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:
<TABLE>
<CAPTION>
Per Unit Value
Shares Acquisition Date at 9-30-97 Cost
<S> <C> <C> <C> <C>
Pentech International, Inc. 50,000 January 13, 1997 $0.8958 $25,000
=======
</TABLE>
The restricted security had a fair value of $44,790, or 0.16% of net assets, at
September 30, 1997.
NOTE 4 - COMMITMENTS AND OTHER RELATED PARTY TRANSACTIONS
For the six months ended September 30, 1997, Hodges Capital Management,
Incorporated (the "Advisor") provided the Fund with investment management
services under an Investment Advisory Agreement. The Advisor furnished all
investment advice, office space, facilities, and 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 0.85% based upon the average daily net assets
of the Fund. For the six months ended September 30, 1997, the Fund incurred
$100,945 in Advisory fees.
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 daily net assets
$50 to $100 million 0.15% of average daily net assets
$100 to $150 million 0.10% of average daily net assets
Over $150 million 0.05% of average daily net assets
First Dallas Securities, 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 Advisor. For the six months ended September
30, 1997, the Distributor received as commissions $40,661 from the Fund in
connection with its distribution of the Fund's shares.
Certain officers and trustees of the Trust are also officers and/or
directors of the Administrator.
<PAGE>
Hodges Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited), Continued
- --------------------------------------------------------------------------------
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 0.50% 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
six months ended September 30, 1997, the Fund paid fees of $59,379 to the
Distributor.
NOTE 6 - PURCHASES AND SALES OF SECURITIES
The cost of purchases and proceeds from sales of securities, excluding
short-term securities, for the six months ended September 30, 1997, were
$14,738,784 and $14,026,309, respectively.
3
<PAGE>
Advisor
Hodges Capital Management, Incorporated
2905 Maple Avenue
Dallas, Texas 75201
(800) 388-8512
--
Distributor
First Dallas Securities, Inc.
2905 Maple Avenue
Dallas, Texas 75201
--
Custodian
Star Bank, N.A.
425 Walnut Street
Cincinnati, Ohio 45202
--
Transfer Agent
American Data Services, Inc.
P.O. Box 5536
Hauppauge, New York 11788-0132
--
Auditors
Tait, Weller & Baker
Eight Penn Center Plaza, Suite 800
Philadelphia, Pennsylvania 19103
--
Legal Counsel
Paul, Hastings, Janofsky & Walker
345 California Street, 29th Floor
San Francisco, California 94104
This report is intended for shareholders of the Fund
and may not be used as sales literature unless
preceded or accompanied by a current prospectus.
Past performance results shown in this report should
not be considered a representation of future
performance. Share price and returns will fluctuate
so that shares, when redeemed may be worth more
or less than their original cost. Statements and other
information herein are dated and are subject to change.
