Semi-Annual Report
For the Six Months Ended
September 30, 1998
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
October 20, 1998
Dear Shareholders:
October 1, 1998 marked the fifth anniversary of the Women's Equity Mutual Fund.
We are pleased to have heard from many of you who have given us so much support
and encouragement about our work. Your input tells us that while we still have
much to do to improve the status of women in the workplace, we have made some
inroads that we can celebrate.
As of September 30, 1998, the Fund's average annual total returns are as
follows:
<TABLE>
<CAPTION>
One Three Five From Inception
Year Years Years at 10/1/93
Pro-Conscience
<S> <C> <C> <C> <C>
Women's Equity Mutual Fund 11.56% 17.22% 12.93% 12.93%
</TABLE>
Over the summer the market was jolted by continuing turmoil in Asia, concerns
about the Russian economy, and the potential spread of emerging market problems
to South America. In the first half of 1998, we actually benefitted from the
problems in Asian countries. As the value of their currencies fell, so did the
cost of the commodities and goods we bought from them. But devalued currencies
in Asia also made it more expensive for them to buy US goods, putting pressure
on the earnings of US corporations.
There is hope that the Japanese economy will improve if banks take advantage of
a government plan to be made into law to give banks public funds to boost
balance sheets and enable them to lend more and alleviate the credit crunch. As
Japan recovers, it will be in a better position to help other Asian countries
back to recovery.
Since the beginning of October we have seen a market gain of about 10 percent
bolstered by better-than-expected earnings and interest rate cuts by the Federal
Reserve to keep the economy on track.
We will continue to experience many uncertainties in the coming months and we
need to constantly remind ourselves that the best protection for investors is
keeping a well-diversified portfolio and that investments in equities are for
the long-term.
We hope you will continue to provide us with comments and suggestions and we
thank you for your support.
Sincerely yours,
/s/
Linda C.Y. Pei
President
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS at September 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS: 99.7% Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Computer Services: 0.9%
<S> <C> <C>
2,000 Affiliated Computer Services, Inc., Class A *........................... $ 61,000
--------
Consumer Durables: 2.3%
2,400 Harley-Davidson, Inc.................................................... 70,500
1,500 Honda Motor Company, Ltd................................................ 91,031
------
161,531
-------
Consumer Products and Services: 12.5%
2,600 American Greetings Corp., Class A....................................... 102,863
4,000 Avon Products, Inc...................................................... 112,250
2,700 Coca-Cola Company....................................................... 155,587
2,500 Colgate-Palmolive Company............................................... 171,250
4,844 Dollar General Corp..................................................... 128,965
2,600 Gillette Company........................................................ 99,450
4,000 Jones Apparel Group, Inc................................................ 91,750
------
862,115
-------
Energy and Resources: 1.4%
1,800 Amoco Corp.............................................................. 96,975
------
Financial Services: 14.8%
900 American International Group, Inc....................................... 69,300
1,600 BankAmerica Corp........................................................ 96,200
4,000 BankBoston Corp......................................................... 132,000
2,000 Chubb Corp.............................................................. 126,000
2,800 Federal National Mortgage Association................................... 179,900
1,800 First Tennessee National Corp........................................... 49,162
1,500 NationsBank Corp........................................................ 80,250
5,250 Norwest Corp............................................................ 188,016
2,000 UNUM Corp............................................................... 99,375
------
1,020,203
---------
Food - Baking: 2.1%
4,700 Earthgrains Company..................................................... 145,406
-------
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
SCHEDULE OF INVESTMENTS at September 30, 1998 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Furnishings: 5.4%
4,000 Herman Miller, Inc...................................................... $ 79,000
7,800 Leggett & Platt, Inc.................................................... 161,850
2,900 Newell Company.......................................................... 133,581
-------
374,431
-------
Health Care: 18.5%
3,800 Becton, Dickinson and Company........................................... 156,275
2,800 Johnson & Johnson....................................................... 219,100
4,200 Medtronic, Inc.......................................................... 243,075
1,800 Merck & Company, Inc.................................................... 233,213
2,900 Schering-Plough Corp.................................................... 300,331
3,700 Stryker Corp.*.......................................................... 125,800
-------
1,277,794
---------
Industrial Materials: 1.2%
2,600 Praxair, Inc............................................................ 84,988
------
Instruments: 1.2%
2,400 Teleflex, Inc........................................................... 84,000
------
Media and Publishing: 1.3%
3,600 Walt Disney Company..................................................... 91,125
------
Oil & Gas Producers: 1.3%
1,000 British Petroleum Company, PLC.......................................... 87,250
------
Power Supply Equipment: 1.0%
2,000 Hubbell, Inc., Class B.................................................. 71,000
------
Producer Products: 4.1%
5,000 Baldor Electric Company................................................. 109,375
3,250 Illinois Tool Works, Inc................................................ 177,125
-------
286,500
-------
Publishing Newspapers: 1.3%
3,000 McClatchy Company, Class A.............................................. 90,000
------
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
SCHEDULE OF INVESTMENTS at September 30, 1998 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Market Value
- ------------------------------------------------------------------------------------------------------------------------------------
Retail: 3.2%
3,500 BJ's Wholesale Club, Inc.*.............................................. $ 128,625
2,000 Costco Companies, Inc................................................... 94,750
------
223,375
-------
Technology: 14.3%
1,300 Automatic Data Processing, Inc.......................................... 97,175
3,375 Cisco Systems, Inc...................................................... 208,617
1,200 Hewlett-Packard Company................................................. 63,525
1,300 Intel Corp.............................................................. 111,475
3,000 Microsoft Corp.*........................................................ 330,188
2,500 Sanmina Corp............................................................ 70,312
1,300 Xerox Corp.............................................................. 110,175
-------
991,467
-------
Telecommunications - Equipment: 6.8%
3,500 Aliant Communications, Inc.............................................. 86,625
3,400 Century Telephone Enterprises, Inc...................................... 160,650
3,200 Lucent Technologies, Inc................................................ 221,000
-------
468,275
-------
Transportation: 1.2%
4,050 Southwest Airlines Company.............................................. 81,000
------
Utilities: 4.9%
2,100 BellSouth Corp.......................................................... 158,025
4,000 SBC Communications, Inc................................................. 177,750
-------
335,775
-------
Total Investment in Securities (cost $4,897,359+): 99.7%................ 6,894,210
Other Assets less Liabilities: 0.3%..................................... 23,600
------
Total Net Assets: 100.0% ............................................... $6,917,810
==========
<FN>
*Non-income producing security.
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
SCHEDULE OF INVESTMENTS at September 30, 1998 (Unaudited), Continued
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
+At September 30, 1998, 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..................................... $2,197,740
Gross unrealized depreciation..................................... (200,889)
--------
Net unrealized appreciation................................ $1,996,851
==========
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES at September 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C>
Investments in securities, at value (cost $4,897,359).................................. $ 6,894,210
Cash................................................................................... 84,718
Receivables:
Due from Advisor................................................................. 3,011
Fund shares sold................................................................. 1,256
Dividends and interest........................................................... 5,228
Prepaid expenses....................................................................... 6,117
-----
Total assets .............................................................. 6,994,540
---------
LIABILITIES
Payable for securities purchased....................................................... 45,450
Accrued audit fees..................................................................... 9,074
Accrued expenses ...................................................................... 22,206
------
Total liabilities.......................................................... 76,730
------
NET ASSETS .............................................................................. $ 6,917,810
===========
Net asset value, offering and redemption price per share
($6,917,810/416,090 shares outstanding;
unlimited number of shares authorized without par value) ........................ $16.63
======
COMPONENTS OF NET ASSETS
Paid-in capital........................................................................ $ 4,821,087
Accumulated net investment loss........................................................ (20,220)
Undistributed net realized gain on investments......................................... 120,092
Net unrealized appreciation on investments............................................. 1,996,851
---------
Net assets ...................................................................... $ 6,917,810
===========
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS - For the Six Months Ended September 30, 1998
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Income
<S> <C>
Dividends........................................................................ $ 35,999
Interest......................................................................... 2,368
-----
Total income............................................................... 38,367
------
Expenses
Advisory fees.................................................................... 39,527
Administration fee............................................................... 15,041
Distribution fees................................................................ 9,205
Transfer agent fees.............................................................. 9,040
Fund accounting fees............................................................. 8,418
Audit fee........................................................................ 7,094
Registration fees ............................................................... 4,925
Custody fees..................................................................... 3,618
Reports to shareholders.......................................................... 2,513
Trustee fees .................................................................... 2,003
Legal fees....................................................................... 1,503
Miscellaneous.................................................................... 1,256
Sub-Advisory fees................................................................ 556
---
Total expenses............................................................. 104,699
Less: expenses waived and reimbursed....................................... (49,417)
-------
Net expenses............................................................... 55,282
------
Net investment loss ............................................... (16,915)
-------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain from security transactions .......................................... 91,097
Net change in unrealized appreciation on investments .................................. (685,570)
--------
Net realized and unrealized loss on investments ........................... (594,473)
--------
Net decrease in net assets resulting from operations ................ $ (611,388)
==========
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year
Ended Ended
September 30, 1998# March 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
(DECREASE) INCREASE IN NET ASSETS FROM:
OPERATIONS
<S> <C> <C>
Net investment loss ............................................... $ (16,915) $ (14,155)
Net realized gain from security transactions ....................... 91,097 87,152
Net change in unrealized appreciation on investments................ (685,570) 2,196,962
-------- ---------
Net (decrease) increase in net assets resulting
from operations ............................................... (611,388) 2,269,959
-------- ---------
DISTRIBUTIONS TO SHAREHOLDERS
Net realized gain on investments.................................... -0- (54,283)
- -------
CAPITAL SHARE TRANSACTIONS
Net increase in net assets derived from net change in
outstanding shares (a) .......................................... 557,936 310,806
------- -------
Total (decrease) increase in net assets ......................... (53,452) 2,526,482
NET ASSETS
Beginning of period................................................. 6,971,262 4,444,780
--------- ---------
End of period ........................................................ $6,917,810 $6,971,262
========== ==========
<FN>
(a) A summary of capital shares transactions is as follows:
Six Months Ended Year Ended
September 30, 1998# March 31, 1998
Shares Value Shares Value
Shares sold ...................................... 49,773 $ 903,503 79,313 $1,193,662
Shares issued in reinvestment of distribution..... -0- -0- 3,414 52,744
Shares redeemed .................................. (19,476) (345,567) (64,217) (935,600)
------- -------- ------- --------
Net increase...................................... 30,297 $ 557,936 18,510 $ 310,806
====== ========= ====== =========
#Unaudited.
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a capital share outstanding throughout each period
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months October 1, 1993*
Ended Year Ended March 31, through
September 30, 1998# 1998 1997 1996 1995 March 31, 1994
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning
<S> <C> <C> <C> <C> <C> <C>
of period........................ $18.07 $12.10 $11.22 $ 9.93 $10.46 $10.00
------ ------ ------ ------ ------ ------
Income from investment operations:
Net investment income (loss) .... (0.04) (0.04) (0.01) 0.01 0.36 (0.01)
Net realized and unrealized
gain (loss) on investments ... (1.40) 6.16 0.90 1.59 (0.28) 0.47
----- ---- ---- ---- ----- ----
Total from investment operations.... (1.44) 6.12 0.89 1.60 0.08 0.46
----- ---- ---- ---- ---- ----
Less distributions:
From net investment income....... 0.00 0.00 (0.01) (0.31) (0.02) 0.00
From net capital gains .......... 0.00 (0.15) 0.00 0.00 (0.59) 0.00
---- ----- ---- ---- ----- ----
Total distributions................. 0.00 (0.15) (0.01) (0.31) (0.61) 0.00
---- ----- ----- ----- ----- ----
Net asset value, end of period ..... $16.63 $18.07 $12.10 $11.22 $ 9.93 $10.46
====== ====== ====== ====== ====== ======
Total return ....................... (7.97)% 50.77% 7.92% 16.17% 0.97% 4.60%
Ratios/supplemental data:
Net assets, end of
period (millions)................. $ 6.9 $ 7.0 $ 4.4 $ 3.3 $ 1.5 $ 0.6
Ratio of expenses to
average net assets:
Before expense reimbursement
and waiver..................... 2.84%+ 3.12% 4.09% 4.75% 8.69% 21.93%+
After expense reimbursement
and waiver..................... 1.50%+ 1.50% 1.50% 1.50% 1.50% 1.50%+
Ratio of net investment income
(loss) to average net assets:
Before expense reimbursement
and waiver..................... (1.80)%+ (1.88)% (2.64)% (1.97)% (1.97)% (20.74)%+
After expense reimbursement
and waiver..................... (0.46)%+ (0.26)% (0.05)% 1.28% 5.22% 0.31%+
Portfolio turnover rate ............ 5.03% 27.21% 51.13% 120.64% 705.88% 139.26%
<FN>
*Commencement of operations.
+Annualized.
#Unaudited.
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
NOTES TO FINANCIAL STATEMENTS at September 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
NOTE 1 - ORGANIZATION
The Pro-Conscience Women's Equity Mutual 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's primary investment objective is to provide long-term capital
appreciation. The Fund began operations on October 1, 1993.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund. These policies are in conformity with generally accepted
accounting principles.
A. Security Valuation. Investments in securities traded on a national
securities exchange or included in the NASDAQ National Market System
are valued at the last reported 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 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 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
is 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 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 - COMMITMENTS AND OTHER RELATED PARTY TRANSACTIONS
For the six months ended September 30, 1998, Pro-Conscience Funds,
Incorporated (the "Advisor") provided the Fund with investment management
services under an Investment Advisory Agreement. The Advisor furnished all
investment advice, office space, certain administrative services, 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 1.00% based upon the average
daily net assets of the Fund. For the six months ended September 30, 1998, the
Fund incurred $39,527 in Advisory fees. In order to maintain the Fund's
operating expenses at 1.50% of average daily net assets, the Advisor has waived
a portion of its fee and reimbursed expenses totaling $49,417 for the six months
ended
<PAGE>
PRO-CONSCIENCE
WOMEN'S EQUITY MUTUAL FUND
Advancing Gender Equality in the Workplace
NOTES TO FINANCIAL STATEMENTS (Unaudited), Continued
- --------------------------------------------------------------------------------
September 30, 1998. United States Trust Company of Boston (the
"Sub-Advisor") acts as Sub-Advisor to the Fund and is entitled to compensation
for its services from the Advisor.
Investment Company Administration, LLC (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
For the six months ended September 30, 1998, the Fund incurred $15,041 in
Administration fees.
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 4 - 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 may pay a fee to
the Advisor as Distribution Coordinator at an annual rate of up to 0.25% of the
average daily net assets of the Fund. The fee is paid to the Advisor as
reimbursement for, or in anticipation of, expenses incurred for
distribution-related activity. For the six months ended September 30, 1998, the
Fund paid fees of $9,205 to the Advisor.
NOTE 5 - PURCHASES AND SALES OF SECURITIES
The cost of purchases and the proceeds from sales of securities, other
than short-term investments, for the six months ended September 30, 1998, were
$1,011,800 and $353,917, respectively.
<PAGE>
Advisor
Pro-Conscience Funds, Inc.
625 Market Street, 16th Floor
San Francisco, California 94105
(415) 547-9135
o
Distributor
First Fund Distributors, Inc.
4455 E. Camelback Road, Suite 261E
Phoenix, Arizona 85018
o
Custodian
Star Bank, N.A.
425 Walnut Street
Cincinnati, Ohio 45202
o
Transfer Agent
American Data Services, Inc.
P.O. Box 5536
Hauppauge, NY 11788
(800) 282-2340
o
Auditors
Tait, Weller & Baker
8 Penn Center, Suite 800
Philadelphia, Pennsylvania 19101
o
Legal Counsel
Paul, Hastings, Janofsky & Walker LLP
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.
