PROFESSIONALLY MANAGED PORTFOLIOS, N-30D, 1997-11-05

PROFESSIONALLY MANAGED PORTFOLIOS
N-30D, 1997-11-05

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<PAGE> 1
LIGHTHOUSE GROWTH FUND

September 30, 1997

Dear Shareholder,

PERFORMANCE
The LIGHTHOUSE GROWTH FUND began on September 29, 1995, with an NAV of $12.00
and closed on August 29, 1997, at $15.76. For the year ended September 30, 1997,
our total return was 26.77%. The annualized total return from inception through
September 30, 1997, was 19.62%.

INDIVIDUAL INVESTORS - NO RESPECT FOR RISK
Investing is perverse in many respects. The average investor will throw caution
to the wind when stock prices are soaring and risks are greatest. When stock
prices decline substantially and risk is minimal, new investment is unthinkable.

During the late 1980s and early 1990s, bookstores were busy selling warnings of
impending doom to the public. Silicon Valley's entrepreneurs would not be able
to compete with Japan's bureaucrats. America's twin deficits (budget and trade)
would lead to depression. The U.S. stock market had been turned into a casino
wrecked by derivatives. The perception of risk was high at exactly the time that
opportunities were abundant.

A recent trip to the local Barnes & Noble revealed a much more upbeat investment
climate. Doom-and-gloom is out and do-it-yourself wealth is in. Popular titles
include "The Beardstown Ladies: How We Beat the Stock Market - and How You Can
Too", "The Motley Fool Investment Guide: How the Fools Beat Wall Street's Wise
Men and How You Can Too", "The Complete Idiot's Guide to Getting Rich",
"Investing For Dummies", "Wealth in a Decade", "Bear Market Baloney", "Stock
Market Miracles" and "Sure-Thing Option Trading". The investment club boom is
represented by "The Investment Club Book: Join the Thousands of Everyday
Americans Who Are Successfully Beating Wall Street". The "new economy" theory is
promoted by Harry Dent's "The Great Boom Ahead".

My personal favorite is The "Whiz Kid of Wall Street's Investment Guide: How I
Returned 34% On My Portfolio and You Can Too". The author, Matt Seto, is 17
years old. This barely gets him out of diapers during the 1987 Crash. Who needs
experience when the stock market only goes up? In fact, these days one would
think experience is a detriment to investment success. Today, the public's
perception is that risks are minimal and that investing is simple. Nothing could
be further from the truth.

VALUATIONS AND THE BUSINESS CYCLE - NO REGARD FOR HISTORY

All major declines in stock prices this century began during periods of high
optimism, strong economic conditions and high stock valuations. In the Roaring
1920s, the newly created Federal Reserve was viewed as the vehicle to permanent
prosperity, stable prices and a flattened business cycle. Skyscrapers grew like
weeds and stocks soared, with the total market capitalization of the New York
Stock Exchange at one point exceeding 81% of the country's GDP. During the
"go-go" 1960s post-World War II boom, national pride and optimism were fueled by
technological advances and achievements, such as landing a man on the moon.
Total NYSE market cap reached 78% of GDP. In the late 1980s, Japan was feared
and respected for its industrial policy model and export-led powerhouses. At the
peak, Japan's total market cap surpassed that of the U.S. Eventually, all three
booms came to an end. U.S. stocks (as measured by the Dow) dropped 89% from 1929
to 1932 and 41% from 1968 to 1974. Japanese stocks have declined 50% from 1989
to the present.
<PAGE> 2
The U.S. stock market of the late 1990s shows similar boom characteristics.
Analysts and journalists on CNBC feed the illusion that gains of the recent past
will continue. They cite low inflation, low interest rates, strong productivity
gains, sustainable economic growth (i.e. repeal of the business cycle), solid
corporate earnings growth and baby boomers eager to toss their savings at the
market as justifications for ever-increasing prices. Total NYSE market cap is
now over 115% of GDP, even though two companies with enormous capitalizations,
Microsoft and Intel, are not included.

SIGNS OF EXCESS - NO LACK OF CONFIDENCE
As is typical of late-stage bull markets, signs of excess are everywhere. Stock
prices are rising at a parabolic rate, while reasonable valuations fade further
into the distance. Cash is a four-letter word in the sense that mutual funds no
longer wish to hold any. High stock prices are rationalized by consensus
opinions such as, "it's different this time", "it's a new economy", and
"inflation is dead". Consumer confidence is at its highest level since 1969.
Investor confidence is also high. A recent Harris poll showed that 85% of
respondents expect the market to provide above average returns over the next ten
years. Index funds, through their immense popularity, look to us like a modern
day Ponzi scheme. Stocks, as a percentage of household assets, are at their
highest level since the late 1960s. Investment clubs are proliferating. Initial
public offerings (e.g. Amazon.com, E*Trade and OnSale) are sizzling. Option call
buying is off the charts, especially for stocks expected to split. Mergers and
acquisitions are soaring. For example, commercial banks are in a feeding frenzy
to buy investment banks, paying an unprecedented five to seven times book value.

Already, cracks are appearing in the perfect environment scenario. Wage
inflation is increasing. Credit card delinquencies and personal bankruptcies are
rising. Technology spending is decelerating as several companies (Intel,
Microsoft, Seagate, Gateway 2000, Micron Technology, Ascend Communications and
Hewlett-Packard) have warned of either disappointing earnings or a slowdown in
their growth rates. Huge frauds, such as Bre-X Minerals (the biggest scam in the
annals of gold mining) and Centennial Technologies (the largest gainer on the
NYSE last year) have already been perpetrated on investors long on gullibility
and short on due diligence.

This party, like others before it, will eventually end, and end badly. When it
does, a few risk-averse investors will be in an enviable position to exploit the
mistakes of those who got caught up in the frenzy.

INVESTMENT STRATEGY
The LIGHTHOUSE GROWTH FUND has become more defensive since our last letter. The
Fund increased its short position, cash and energy weighting, while holding its
position in gold mining constant. As of August 29, 19.4% of the portfolio was
hedged using S&P 500 put options, up from 14.8% six months ago.

TIME FOR A CHANGE
We are in the process of changing the name of the Fund to the LIGHTHOUSE
CONTRARIAN FUND. We originally intended the word "growth" to refer to our
investment objective. We became concerned, however, that the term could cause
confusion with a "growth-oriented" investment style. The objective will remain
capital appreciation and the style, of course, contrarian. We will let you know
as soon as the name change becomes official.

<PAGE> 3
THANKS TO OUR SHAREHOLDERS

I would personally like to thank you, our shareholders, for your patience and
support. Leaning against the wind of popular opinion is never easy, but, without
your confidence, would be next to impossible.

Net assets in the Fund continue to climb, now topping $30 million. Fund
information is now available from Morningstar, Bloomberg and The New York Times.
Closing prices are available using the symbol "LGFTX", or by visiting our Web
site at http://www.lightkeepers.com.

/s/Kevin P. Duffy
- -----------------
Kevin P. Duffy
Portfolio Manager

[LIGHTHOUSE GROWTH FUND GRAPH]
<TABLE>
<CAPTION>
Lighthouse Growth Fund S&P 500 Index Lipper Growth Index
---------------------- ------------- -------------------
<S> <C> <C> <C>
9/29/95 10,000 10,000 10,000
2/29/96 10,546 11,062 10,657
8/31/96 11,367 11,390 10,772
8/31/97 13,438 16,008 14,483
</TABLE>

Average Annual Total Return
Ended August 31, 1997

1 Year ...................... 18.22%
Since Inception (9/29/95) ... 16.60%

Past performance is not predictive of future performance.

<PAGE> 4
LIGHTHOUSE GROWTH FUND

<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS AT AUGUST 31, 1997
- ------------------------------------------------------------------------------------
Shares COMMON STOCKS: 79.2% Market Value
- ------------------------------------------------------------------------------------
<S> <C>
CAPITAL GOODS: 3.9%
30,000 3D Systems Corp. ................................. $ 270,000
3,000 Commercial Metals Company ........................ 92,250
15,000 Huntco, Inc. ..................................... 208,125
11,000 Nucor Corp. ...................................... 623,562
----------
1,193,937
----------
CONSUMER GOODS - APPAREL: 7.0%
21,000 Donna Karan International, Inc. .................. 275,625
8,200 Jones Apparel Group, Inc. ........................ 411,537
4,300 Liz Claiborne, Inc. .............................. 191,619
36,000 Norton McNaughton, Inc. .......................... 171,000
25,000 Oshkosh B'Gosh, Inc., Class A .................... 634,375
13,000 Quiksilver, Inc. ................................. 442,813
----------
2,126,969
----------
CONSUMER GOODS - CONSUMER PRODUCTS: 3.3%
38,400 Fossil, Inc. ..................................... 672,000
7,700 Helen of Troy, Ltd. .............................. 252,175
9,700 Polk Audio, Inc. ................................. 87,300
----------
1,011,475
----------
CONSUMER GOODS - FOOD PRODUCERS: 0.9%
32,000 The Unimark Group, Inc. .......................... 278,000
----------

CONSUMER GOODS - RESTAURANTS: 1.6%
10,000 The Cheesecake Factory, Inc. ..................... 276,250
12,000 Lone Star Steakhouse & Saloon, Inc. .............. 206,250
----------
482,500
----------
CONSUMER GOODS - RETAIL, APPAREL: 1.6%
10,000 Ann Taylor Stores Corp. .......................... 171,250
23,000 Designs, Inc. .................................... 96,312
10,000 The Limited, Inc. ................................ 227,500
----------
495,062
----------
CONSUMER GOODS - RETAIL, GENERAL MERCHANDISE: 1.5%
3,500 Dillard Department Stores, Inc., Class A ......... 140,000
22,000 Kmart Corp. ...................................... 305,250
----------
445,250
----------
</TABLE>

See accompanying Notes to Financial Statements.
<PAGE> 5
LIGHTHOUSE GROWTH FUND

SCHEDULE OF INVESTMENTS AT AUGUST 31, 1997, CONTINUED

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Shares Market Value
- --------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER GOODS - RETAIL, MAIL ORDER: 3.2%
37,600 Lands' End, Inc. ............................. $ 989,350
----------
CONSUMER GOODS - RETAIL, SPECIALTY: 7.5%
12,000 Claire's Stores, Inc. ........................ 252,000
70,000 Good Guys, Inc. .............................. 551,250
14,000 MicroAge, Inc. ............................... 380,625
75,000 REX Stores Corp. ............................. 740,625
45,200 Sun Television & Appliances, Inc. ............ 111,587
7,500 Toys "R" Us, Inc. ............................ 259,219
----------
2,295,306
----------
CONSUMER GOODS - TOBACCO: 1.4%
2,400 Philip Morris Companies, Inc. ................ 104,700
9,000 RJR Nabisco Holdings Corp. ................... 313,313
----------
418,013
----------
ENERGY - OIL, SECONDARY: 20.8%
8,000 Anadarko Petroleum Corp. ..................... 587,500
29,000 Barrett Resources Corp. ...................... 1,062,125
50,000 Basin Exploration, Inc. ...................... 512,500
18,000 Forest Oil Corp. ............................. 288,000
25,000 Key Production Company ....................... 300,000
34,000 Nuevo Energy Company ......................... 1,727,625
10,000 Ocean Energy, Inc. ........................... 643,125
28,000 Plains Resources, Inc. ....................... 511,000
8,000 Pogo Producing Company ....................... 347,000
15,000 Titan Exploration, Inc. ...................... 146,250
9,000 Union Pacific Resources Group, Inc. .......... 225,000
----------
6,350,125
----------
ENERGY - OIL FIELD SERVICES: 1.8%
12,000 Reading & Bates Corp. ........................ 435,750
2,000 Tidewater, Inc. .............................. 105,000
----------
540,750
----------
ENERGY - SEISMIC: 3.2%
38,000 Mitcham Industries, Inc. ..................... 722,000
3,000 Western Atlas, Inc. .......................... 237,750
----------
959,750
----------
</TABLE>

See accompanying Notes to Financial Statements.

5
<PAGE> 6
LIGHTHOUSE GROWTH FUND

SCHEDULE OF INVESTMENTS AT AUGUST 31, 1997, CONTINUED

FINANCIAL - MUTUAL FUND COMPANIES: 0.1%
1,050 Value Line, Inc. ....................... 38,325
----------

HEALTH CARE - BIOTECHNOLOGY: 0.8%
40,000 Xoma Corp. ............................. 252,500
----------

HEALTH CARE - PHARMACEUTICALS: 4.3%
36,000 ICN Pharmaceuticals, Inc. .............. 1,300,500
----------

PRECIOUS METALS - GOLD MINING: 4.3%
40,000 Agnico Eagle Mines, Ltd. ............... 352,500
14,000 Coeur D'Alene Mines Corp. .............. 199,500
20,000 Crown Resources Corp. .................. 127,500
15,000 Newmont Mining Corp. ................... 634,688
----------
1,314,188
----------
TECHNOLOGY - COMMUNICATIONS: 0.3%
13,000 Vtel Corp. ............................. 95,062
----------

TECHNOLOGY - COMPUTERS: 0.9%
5,400 Sun Microsystems, Inc. ................. 259,200
----------

TECHNOLOGY - SEMICONDUCTORS: 2.0%
5,000 QLogic Corp. ........................... 196,250
22,500 SDL, Inc. .............................. 399,375
----------
595,625
----------
TECHNOLOGY - SOFTWARE: 5.8%
50,000 Informix Corp. ......................... 453,125
12,000 Intersolv, Inc. ........................ 194,250
50,000 Progress Software Corp. ................ 887,500
13,000 Sybase, Inc. ........................... 242,125
----------
1,777,000
----------
</TABLE>

See accompanying Notes to Financial Statements.

6
<PAGE> 7
LIGHTHOUSE GROWTH FUND

SCHEDULE OF INVESTMENTS AT AUGUST 31, 1997, CONTINUED

Total Common Stocks (cost $19,196,232) ....... 24,123,837
----------

CLOSED-END FUNDS - INTERNATIONAL: 2.2%
- --------------------------------------------------------------------------------
19,000 Argentina Fund ............................... 275,500
16,000 Chile Fund ................................... 389,000
----------
Total Closed-End Funds (cost $604,221) ....... 664,500
----------

LONG EQUITY OPTIONS: 2.3%
- --------------------------------------------------------------------------------
Contracts Common Stocks/Expiration Date/Exercise Price
- --------------------------------------------------------------------------------
30 Banc One Corp./November 60 Puts .............. 21,750
40 Citicorp/January 150 Puts .................... 94,000
70 Coca-Cola Co./January 75 Puts ................ 123,813
30 Gateway 2000/December 50 Puts ................ 37,500
130 Kellogg/December 45 Puts ..................... 39,813
100 Merrill Lynch/January 70 Puts ................ 105,000
70 Micron Technology/October 65 Puts ............ 143,062
50 Microsoft Corp./October 150 Puts ............. 94,375
30 NationsBank Corp./January 75 Puts ............ 48,375
----------
Total Long Equity Options (cost $535,767) .... 707,688
----------

LONG INDEX OPTIONS: 1.3%
- --------------------------------------------------------------------------------
Index/Expiration Date/Exercise Price
- --------------------------------------------------------------------------------
65 S&P 500/September 950 Puts ................... 326,625
30 Semiconductor Index/December 350 Puts ........ 56,250
----------
Total Long Index Options (cost $305,831) ..... 382,875
----------
</TABLE>

See accompanying Notes to Financial Statements.

7
<PAGE> 8
LIGHTHOUSE GROWTH FUND

Total Investment in Securities (cost $21,394,051*): 87.4%....................... 26,630,900
Other Assets less Liabilities: 12.6% ........................................... 3,833,142
-----------
TOTAL NET ASSETS: 100.0% ....................................................... $30,464,042
===========

SECURITIES SOLD SHORT at August 31, 1997: (28.3%)
- ---------------------------------------------------------------------------------------------------------------------
Shares Common Stocks
- ---------------------------------------------------------------------------------------------------------------------
CONSUMER GOODS - LUXURY ITEMS: (2.3%)
6,000 Gucci Group, NV ................................................................ $ 365,250
14,000 Saks Holdings, Inc. ............................................................ 325,500
-----------
690,750
-----------
CONSUMER GOODS - RESTAURANTS: (0.5%)
7,000 Planet Hollywood International, Inc., Class A .................................. 137,375
-----------

CONSUMER GOODS - RETAIL, SPECIALTY: (0.1%)
750 Just For Feet, Inc. ............................................................ 9,844
-----------

FINANCIAL - BANKS: (3.7%)
5,000 Banc One Corp. ................................................................. 268,125
3,800 Citicorp ....................................................................... 484,975
6,000 NationsBank Corp. .............................................................. 356,250
-----------
1,109,350
-----------
FINANCIAL - CONSUMER CREDIT: (1.0%)
11,000 The Money Store, Inc. .......................................................... 313,500
-----------

TECHNOLOGY - COMPUTERS: (1.5%)
12,000 Gateway 2000, Inc. ............................................................. 469,500
-----------
</TABLE>

See accompanying Notes to Financial Statements.

8
<PAGE> 9
LIGHTHOUSE GROWTH FUND

<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS AT AUGUST 31, 1997, CONTINUED
- --------------------------------------------------------------------------------------------------------------------
SECURITIES SOLD SHORT, Continued
- --------------------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS Market Value
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
TECHNOLOGY - INTERNET: (4.9%)
4,500 Netscape Communications Corp. .................................................. $ 179,156
7,100 Security Dynamics Technologies, Inc. ........................................... 279,119
17,600 Yahoo!, Inc. ................................................................... 1,047,200
-----------
1,505,475
-----------
TECHNOLOGY - NETWORKING: (1.5%)
10,000 Ascend Communications, Inc. .................................................... 424,375
3,000 Shiva Corp. .................................................................... 44,250
-----------
468,625
-----------
TECHNOLOGY - SEMICONDUCTORS: (2.8%)
7,500 Alliance Semi-Conductor Corp. .................................................. 99,375
3,500 C-Cube Microsystems, Inc. ...................................................... 105,000
1,000 Integrated Silicon Solutions, Inc. ............................................. 14,625
8,000 Logic Devices, Inc. ............................................................ 27,000
13,000 Micron Technology, Inc. ........................................................ 579,313
500 Xilinx, Inc. ................................................................... 23,750
-----------
849,063
-----------
TECHNOLOGY - SEMICONDUCTOR EQUIPMENT: (9.0%)
10,000 Applied Materials, Inc. ........................................................ 943,750
12,600 KLA-Tencor Corp. ............................................................... 893,025
20,000 Kulicke & Soffa Industries, Inc. ............................................... 918,750
-----------
2,755,525
-----------
TECHNOLOGY - SOFTWARE: (1.0%)
1,000 Microsoft Corp. ................................................................ 132,187
9,000 Zitel Corp. .................................................................... 181,125
-----------
313,312
-----------
Total Common Stocks Sold Short (proceeds $6,949,880) ........................... $ 8,622,319
-==========

* At August 31, 1997, the cost of the 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 .................................................. $ 7,230,367
Gross unrealized depreciation .................................................. (3,665,957)
-----------
Net unrealized appreciation .............................................. $ 3,564,410
===========
</TABLE>

See accompanying Notes to Financial Statements.

9
<PAGE> 10
LIGHTHOUSE GROWTH FUND

<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES AT AUGUST 31, 1997
- --------------------------------------------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments in securities, at value (cost $20,552,453) ........................................ $25,540,337
Cash .......................................................................................... 204
Deposits with brokers for securities sold short ............................................... 12,305,614
Put options purchased (cost $841,598) ......................................................... 1,090,563
Receivables:
Fund shares sold ........................................................................ 167,338
Dividends and interest .................................................................. 49,215
Deferred organization costs ................................................................... 20,596
Other assets .................................................................................. 47,447
-----------
Total assets ...................................................................... 39,221,314
-----------

LIABILITIES
Securities sold short, at value (proceeds $6,949,880) ......................................... 8,622,319
Payables:
Investment securities purchased ......................................................... 70,305
Advisory fees ........................................................................... 24,380
Administration fee ...................................................................... 4,936
Distribution fees ....................................................................... 12,204
Fund shares redeemed .................................................................... 3,500
Accrued expenses .............................................................................. 19,628
-----------
Total liabilities ................................................................. 8,757,272
-----------

NET ASSETS .......................................................................................... $30,464,042
===========

NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE
($30,464,042/1,932,933 shares outstanding;
unlimited shares authorized without par value) ................................................ $15.76
===========

COMPONENTS OF NET ASSETS
Paid-in capital ............................................................................... $25,947,507
Accumulated net investment loss ............................................................... (63,421)
Undistributed net realized gain on investments ................................................ 1,015,546
Net unrealized appreciation on investments .................................................... 3,564,410
-----------
Net assets ........................................................................ $30,464,042
===========
</TABLE>

See accompanying Notes to Financial Statements.

10
<PAGE> 11
LIGHTHOUSE GROWTH FUND

STATEMENT OF OPERATIONS - FOR THE YEAR ENDED AUGUST 31, 1997
- --------------------------------------------------------------------------------
INVESTMENT INCOME
<TABLE>
<S> <C>
Income
Interest ......................................................... $ 383,040
Dividends ........................................................ 99,600
-----------
Total income ............................................... 482,640
-----------

Expenses
Advisory fees .................................................... 277,492
Distribution fees ................................................ 55,500
Administration fee ............................................... 43,889
Custodian and accounting fees .................................... 35,331
Registration fee ................................................. 22,498
Audit fees ....................................................... 15,500
Reports to shareholders .......................................... 14,199
Transfer agent fees .............................................. 13,687
Dividends paid on short sales .................................... 13,415
Miscellaneous fees ............................................... 6,343
Trustees' fees ................................................... 5,235
Amortization of deferred organization costs ...................... 4,473
Legal fees ....................................................... 3,457
-----------
Total expenses ............................................. 511,019
Less: expenses reimbursed .................................. (53,616)
-----------
Net expenses ............................................... 457,403
-----------
NET INVESTMENT INCOME ................................ 25,237
-----------

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain from security transactions ..................... 1,422,317
Net realized gain from short sale transactions ................... 669,699
Net realized loss on put options purchased ....................... (952,617)
Net change in unrealized appreciation on investments ............. 2,609,095
-----------
Net realized and unrealized gain on investments ............ 3,748,494
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.. $ 3,773,731
===========
</TABLE>

See accompanying Notes to Financial Statements.

11
<PAGE> 12

LIGHTHOUSE GROWTH FUND

STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Year September 29,
Ended 1995* through
August 31, 1997 August 31, 1996
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE IN NET ASSETS FROM:
OPERATIONS
Net investment income (loss) .................................................. $ 25,237 $ (88,658)
Net realized gain from security transactions .................................. 1,422,317 244,701
Net realized gain from short sale transactions ................................ 669,699 -0-
Net realized loss on put options purchased .................................... (952,617) (23,135)
Net change in unrealized appreciation on investments .......................... 2,609,095 955,315
------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS .................... 3,773,731 1,088,223
------------ ------------

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net realized gain from security transactions .................................. (315,958) (29,461)
------------ ------------

CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived from net change in outstanding shares (a)... 13,041,844 12,905,663
------------ ------------
Total increase in net assets ............................................ 16,499,617 13,964,425

NET ASSETS
Beginning of period .......................................................... 13,964,425 -0-
------------ ------------
END OF PERIOD (including undistributed net investment loss of
$63,421 and $88,658, respectively) ...................................... $ 30,464,042 $ 13,964,425
============ ============
</TABLE>

(a) A summary of capital shares transactions is as follows:

<TABLE>
<CAPTION>
Year September 29, 1995*
Ended through
August 31, 1997 August 31, 1996
--------------------------- ---------------------------
Shares Value Shares Value
--------- ------------ --------- ------------
<S> <C> <C> <C> <C>
Shares sold .................................... 1,173,527 $ 17,013,634 1,114,505 $ 14,014,925
Shares issued in reinvestment of distribution... 20,938 311,143 2,409 29,010
Shares redeemed ................................ (290,812) (4,282,933) (87,634) (1,138,272)
---------- ------------ ---------- ------------
Net increase ............................. 903,653 $ 13,041,844 1,029,280 $ 12,905,663
========== ============ ========== ============
</TABLE>

*Commencement of operations.

See accompanying Notes to Financial Statements.

12
<PAGE> 13

LIGHTHOUSE GROWTH FUND

FINANCIAL HIGHLIGHTS
FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT EACH PERIOD

<TABLE>
<CAPTION>
Year September 29, 1995*
Ended through
August 31, 1997 August 31, 1996
--------------- ---------------
<S> <C> <C>
Net asset value, beginning of period ....................... $ 13.57 $ 12.00
-------- --------
Income from investment operations:
Net investment income ................................ .05 (.09)
Net realized and unrealized gain on investments ...... 2.41 1.72
-------- --------
Total from investment operations ........................... 2.46 1.63
-------- --------
Less distributions:
From net capital gains ............................... (.27) (.06)
-------- --------
Net asset value, end of period ............................. $ 15.76 $ 13.57
======== ========

Total return ............................................... 18.22% 13.67%++

Ratios/supplemental data:

Net assets, end of period (millions) ....................... $ 30.5 $ 14.0

Ratio of expenses to average net assets:
Before expense reimbursement ......................... 2.24% 2.95%+
After expense reimbursement .......................... 2.00% 2.00%+

Ratio of net investment income (loss) to average net assets:
Before expense reimbursement ......................... (0.13%) (2.14)%+
After expense reimbursement .......................... 0.11% (1.19)%+

Portfolio turnover rate .................................... 21.94% 20.56%

Average commission rate paid per share ..................... $ .0489 $ .0588
</TABLE>

*Commencement of operations.

+ Annualized.

++Not Annualized.

See accompanying Notes to Financial Statements.

13
<PAGE> 14
LIGHTHOUSE GROWTH FUND

NOTES TO FINANCIAL STATEMENTS AT AUGUST 31, 1997
- --------------------------------------------------------------------------------

NOTE 1 - ORGANIZATION

The Lighthouse Growth Fund (the "Fund") is a diversified 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 an open-end management investment company. The Fund began
operations on September 29, 1995. The investment objective of the Fund is to
seek growth of capital. The Fund seeks to achieve its objective by investing
primarily in equity securities.

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.

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. Deferred Organization Costs. All of the expenses incurred by
the Advisor in connection with the organization and
registration of the Fund's shares will be borne by the Fund
and are being amortized to expense on a straight-line basis
over a period of five years.

E. 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 at the
date of the financial statements. Actual results could differ
from those estimates.

NOTE 3 - SECURITIES SOLD SHORT

Securities sold short represent obligations of the Fund to make a
future delivery of a specific security and, correspondingly, create an
obligation to purchase the security at prevailing market prices (or deliver the
security, if owned by the Fund) at the later delivery date. As a result, these
short sales create the risk that the Fund's ultimate obligation to satisfy the
delivery requirements may exceed the amount recorded in the accompanying
statement of assets and liabilities.

14
<PAGE> 15
LIGHTHOUSE GROWTH FUND

NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------

The amount deposited with brokers for securities sold short is
essentially restricted to the extent that it serves as a deposit for securities
sold short. It is the Fund's policy to continuously monitor the credit standing
of the brokers with whom it conducts business.

NOTE 4 - COMMITMENTS AND OTHER RELATED PARTY TRANSACTIONS

For the year ended August 31, 1997, Lighthouse 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, 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 1.25% based upon the average daily net assets of the Fund. For
the year ended August 31, 1997, the Fund incurred $277,492 in Advisory fees.

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. Any such reductions made by the Advisor in its fees or payments or
reimbursement of expenses which are the Fund's obligation are subject to
reimbursement by the Fund provided the Fund is able to effect such reimbursement
and remain in compliance with applicable limitations. For the year ended August
31, 1997, the Advisor reimbursed the Fund in the amount of $53,616. The Fund may
reimburse its 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. As of August 31, 1997, the
cumulative expense reimbursement from the Advisor to the Fund is $124,914.

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 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.

Certain officers and trustees of the Trust are also officers and/or
directors of the Administrator and Distributor.

NOTE 5 - DISTRIBUTION PLAN

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 Advisor as Distribution Coordinator at an annual rate of up to 0.25%
of the average

15
<PAGE> 16
LIGHTHOUSE GROWTH FUND

NOTES TO FINANCIAL STATEMENTS, CONTINUED

daily net assets of the Fund. The Plan allows that approved excess distribution
costs can be resubmitted by the Distribution Coordinator in the future years, up
to a maximum of three subsequent fiscal years following initial submission. No
such excess costs were incurred during the current period ended. The Fund paid
$55,500 in distribution costs to the Advisor as the appointed Distribution
Coordinator for the year ended August 31, 1997.

NOTE 6 - PURCHASES AND SALES OF SECURITIES

For the year ended August 31, 1997, the cost of purchases and the
proceeds from sales of securities were $13,366,343 and $9,284,995, respectively.

Purchased options transactions during the year ended August 31, 1997
are summarized as follows:

<TABLE>
<CAPTION>
Put Options Purchased
---------------------
<S> <C>
Options outstanding, beginning of year ................................ $ 120,711
Options purchased ..................................................... 2,137,445
Options closed ........................................................ (1,416,558)
Options exercised ..................................................... -0-
Options expired ....................................................... -0-
-----------
Options outstanding at August 31, 1997 ................................ 841,598
Unrealized appreciation at August 31, 1997 ............................ 248,965
-----------
Market value of options at August 31, 1997 ............................ $ 1,090,563
===========
Average fair market value of options for the year ended August 31, 1997 $ 364,831
===========
Net trading losses on options traded for year ended August 31, 1997 ... $ (952,617)
===========
</TABLE>

16
<PAGE> 17
REPORT OF INDEPENDENT AUDITORS

To the Shareholders of
Lighthouse Growth Fund and
the Board of Trustees of
Professionally Managed Portfolios

We have audited the accompanying statement of assets and liabilities,
including the schedule of investments, of Lighthouse Growth Fund (a series of
Professionally Managed Portfolios) as of August 31, 1997, and the related
statements of operations for the year then ended, the statement of changes in
net assets and the financial highlights for the year then ended and for the
period from September 29, 1995 (commencement of operations) to August 31, 1996.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
August 31, 1997, by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Lighthouse Growth Fund as of August 31, 1997, the results of its
operations for the year then ended, the changes in its net assets and the
financial highlights for the year then ended and for the period from September
29, 1995 (commencement of operations) to August 31, 1996, in conformity with
generally accepted accounting principles.

ERNST & YOUNG LLP

Los Angeles, California
October 14, 1997
<PAGE> 18
[LIGHTHOUSE GRAPHIC]
LIGHTHOUSE GROWTH FUND

- --------------------------------------------------------------------------------

Advisor
LIGHTHOUSE CAPITAL MANAGEMENT, INC.
10000 Memorial Drive, Suite 660
Houston, Texas 77024
(713) 688-6881
Account Inquiries (800) 282-2340

Distributor ANNUAL REPORT
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 and Dividend Disbursing Agent
AMERICAN DATA SERVICES, INC.
P.O. Box 5536
Hauppauge, New York 11788-0132

Auditors
ERNST & YOUNG LLP
515 South Flower Street
Los Angeles, California 90071

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. August 31, 1997