<PAGE>
ROBERTSON STEPHENS MUTUAL FUNDS
The Global Low-Priced Stock Fund
Annual Report
December 31, 1997
[GRAPHIC]
Global Low-Priced
4
<PAGE>
January 30, 1998
FELLOW SHAREHOLDER:
First I want to thank you for being a shareholder in the Robertson Stephens
Funds. All of us here appreciate your support.
As you probably already know, 1997 was an outstanding year for most categories
of equity investing with the notable exception of stocks of Asian companies.
The year also brought very high market volatility especially in shares of
smaller companies, but investors who stayed the course were well rewarded. Yet
as I review the timing and level of redemptions out of our fund complex and
other fund complexes, I am acutely aware that many investors do not stay the
course, and instead sell during market declines worrying that the market will go
even lower. An important study done by an independent consulting group studying
mutual fund investors over a recent ten-year period of time concluded that the
average investor in equity mutual funds had given up between 1/3 to 2/3 of
available returns by selling at the wrong times and reinvesting after the market
had significantly recovered. This slippage in performance is very significant
and obviously needs to be avoided. Developing a financial plan and sticking to
it are the centerpieces for achieving expected returns.
We have put some free tools in place for your convenience to help an investor
stay the course or just stay up to date with fund activity. First, the
portfolio managers of each fund regularly update a recorded message. These
"hotline" messages are accessible for current investors through our toll free
number (1-800-766-3863) and our Web site (www.rsim.com) and are updated
especially during times of significant market volatility. Additionally, we also
conduct monthly conference calls with our portfolio managers and provide
detailed quarterly summaries on each of our equity mutual funds, all of which
can also be accessed on our Web site.
Over the past few years we have introduced several funds that have the objective
of global investing. In 1998 we plan to introduce a new fund - a broadly
diversified large-cap international fund that is designed to be a core holding.
We believe this fund will outperform the benchmark indexes through the
application of an investment discipline based on Economic Value Added (EVA).
This methodology focuses on studying the level of incremental returns on capital
that companies can earn with their free cash flow. Though we have successfully
used EVA analysis for years in some of our funds, this is a little used
methodology in the mutual fund industry. We believe this methodology sets us
apart and that our technological advances gives our portfolio managers a
significant edge in picking winning stocks. We are quite enthusiastic about this
future fund offering.
At Robertson Stephens Funds we continually work on making our investment process
better to achieve the goal of outstanding risk adjusted rates of return. One of
the areas we focused on in 1997 and will continue to focus on in the future is
the use of technologies that help us become better investors. In that regard we
added several new exciting technology tools in 1997. As very significant
shareholders of our own funds we look forward to achieving excellent returns
with you in 1998 and beyond. We believe in the old adage of "Eating your own
cooking."
If you have any questions or suggestions please drop me a note or send me an
E-mail message.
Again, thank you for your support.
/s/ G. Randy Hecht
G. RANDY HECHT
President
Robertson Stephens Funds
[email protected]
Information contained herein relating to the new international fund is subject
to completion or amendment. A registration statement relating to the fund's
securities has been filed with the Securities and Exchange Commission. The
fund's securities may not be sold nor may offers to buy be accepted prior to the
time the registration statement becomes effective. This letter shall not
constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of the fund's securities in any state in which such offer,
solicitation, or sale would be unlawful prior to registration or qualification
under the securities laws of any such state. A prospectus regarding the new
fund is available from BancAmerica Robertson Stephens; an investor should read
that prospectus carefully before investing.
<PAGE>
FUND PHILOSOPHY
The Robertson Stephens Global Low-Priced Stock Fund seeks to achieve long-term
growth of capital by investing worldwide in low-priced stocks (prices no greater
than $10 per share) of companies that have future growth potential but are
overlooked or underappreciated by other investors.
FUND HIGHLIGHTS
ACQUISITION
BankAmerica Corporation's acquisition of Robertson, Stephens & Company became
effective October 1, 1997. The investment management activity for both
organizations has been placed under the leadership of Randy Hecht, President of
Robertson Stephens Investment Management (RSIM) since 1989. We believe this is a
strong commitment to honor the unique culture which remains at the heart of
RSIM's success, and we look forward to the ability to expand our global
capabilities and resources as a result of this partnership.
CONTENTS
Fund Highlights 1
Report to Shareholders 2
Fund Performance - Class A Shares 4
Portfolio Summary 5
Fund Performance - Class C Shares 6
Schedule of Investments 7
Statement of Assets and Liabilities 10
Statement of Operations 11
Statement of Changes in Net Assets 12
Financial Highlights - Class A Shares 13
Financial Highlights - Class C Shares 14
Notes to Financial Statements 15
Report of Independent Accountants 20
Administration 20
1
<PAGE>
[PHOTO]
FUND MANAGER
HANNAH SULLIVAN
Portfolio Manager
The Robertson Stephens Global Low-Priced
Stock Fund
DEAR SHAREHOLDER:
The Robertson Stephens Global Low-Priced Stock Fund (Class A) returned -13.54%
for the one-year period ended December 31, 1997 versus a 14.17% return for the
MSCI World Index and -15.12% for the MSCI Emerging Markets Index. The Fund's
Class C shares had a return of -14.93% since their inception on May 20, 1997.
Some of the bright spots in the Fund's portfolio were food retail and wholesale,
forest products, energy service and manufacturing. From a sector point of view,
the worst performers in the Fund during 1997 were gold mining, transportation
equipment and services, construction and infrastructure, and specialty paper
products. I would like to explain some of the main events that impacted the Fund
this year and discuss some of our favorite investments in the Portfolio.
THE ASIAN PLAGUE
Problems began in Thailand earlier in the year, then spread throughout Southeast
Asia and into Northern Asia, with stock markets plummeting along with Asian
currencies. As I have discussed in previous letters, we had exposure to
Indonesia, Singapore, Hong Kong and China. The stock prices of most of our
Asian positions dropped more than 50% and are now trading at extremely low
levels.
[PHOTO]
INVESTMENT MANAGEMENT
G. RANDY HECHT
President
Robertson Stephens
Funds
[email protected]
INVESTMENT TEAM
RESEARCH
Melissa Floren
Andy Pilara
Borden Putnam III
Paul H. Stephens
SENIOR TRADER
Catherine O'Neill
TRADING
Christopher Beagle
2
<PAGE>
ORPHAN VOLATILITY
And I thought they were cheap when we bought them! Since the end of September,
many of the Fund's larger holdings are down 10-40%. In particular, our four
largest positions: CATHAY INVESTMENT FUND (9.75%), CD RADIO, INC. (7.57%), HAIN
FOOD GROUP, INC. (8.21%) and SINO FOREST CORPORATION, CLASS A (7.16%), all of
which were large contributors to the Fund earlier in the year, have seen large
price declines.
CATHAY INVESTMENT FUND
The Cathay Investment Fund has lost significant market value in the past few
months as the Southeast Asia plague spread to Hong Kong and China. There is
heavy speculation that the Hong Kong dollar will follow its neighbors and drop
the peg to the U.S. dollar. In the meantime, interest rates have risen
significantly in Hong Kong. Cathay continues to sell at more than a 50%
discount to what we view as an unusually depressed NAV.
CD RADIO, INC.
CD Radio recently completed two offerings that will fund the building of its
satellites as well as other expenses through the first quarter of 1999. We feel
this is very positive news since the ability to raise this capital was the
biggest operating risk in the near term. The downside is that, due to market
conditions, the offering was placed at 27.5% below the stock's price in
mid-October and the stock is now trading 40% below its high, thereby affecting
the NAV of the Global Low Priced Stock Fund in the short-term.
HAIN FOOD GROUP, INC.
Hain Food also recently completed a secondary offering, in part to pay for an
exciting new acquisition. During the fundraising process, which took longer
than expected, the stock price declined by 34% from its highs.
SINO FOREST CORPORATION, CLASS A
Sino Forest, another of our larger investments, also took a big hit due to the
Asian flu. The stock hit a high of C$3.90 in mid-October and has since fallen
52% to C$1.85 where it closed on January 22, 1998. By any measure we believe
this stock is now very undervalued. Analysts estimate that the company will
report earnings of C$0.30 for 1997 and over C$0.40 next year, not including the
operations from some new joint ventures. The company's stock price has been hit
because it is a Hong Kong company. However, the demand for hardwood chips in
mainland China, the company's primary market, is very strong and not expected to
be affected by current events in Asia.
None of the stocks we have mentioned were fully priced, even at their highs, and
their volatility reflects the volatility that low-priced stock investors can
face in regard to changes in economic and market conditions.
Sincerely,
/s/ M. Hannah Sullivan
M. HANNAH SULLIVAN
Portfolio Manager
January 22, 1998
TO HEAR MY ONGOING THOUGHTS ON THE FUND, CALL OUR PORTFOLIO MANAGER HOTLINE AT
1-800-766-3863.
3
<PAGE>
FUND PERFORMANCE - CLASS A SHARES
Results of a hypothetical $10,000 investment
in The Robertson Stephens Global Low-Priced Stock Fund, Russell 2000(1), the
MSCI World(2) and MSCI Emerging Markets Global(3) Indexes
IF INVESTED ON NOVEMBER 15, 1995(4)
[GRAPH-Plot points to come]
CUMULATIVE TOTAL RETURNS
<TABLE>
<CAPTION>
MSCI EMERGING
GLOBAL LOW-PRICED RUSSELL 2000 MSCI WORLD MARKETS GLOBAL
FOR THE PERIOD ENDED 12/31/97 STOCK FUND INDEX(1) INDEX(2) INDEX(3)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Since inception (11/15/95)(4) 16.90% 49.82% 33.75% (5.56)%
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
MSCI EMERGING
GLOBAL LOW-PRICED RUSSELL 2000 MSCI WORLD MARKETS GLOBAL
FOR THE PERIODS ENDED 12/31/97 STOCK FUND INDEX(1) INDEX(2) INDEX(3)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
One year (13.54)% 22.36% 14.17% (15.12)%
- ---------------------------------------------------------------------------------------------------------------------------------
Since inception (11/15/95)(4) 7.61% 20.91% 14.64% (2.65)%
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Russell 2000 Index is a market capitalization-weighted index composed
of 2,000 U.S. companies with market capitalizations ranging from $40
million to $450 million. Investment results assume the reinvestment of
dividends paid on the stocks constituting the index. You cannot invest in
an index itself.
(2) The Morgan Stanley Capital International ("MSCI") World Index is an
unmanaged, market capitalization-weighted index composed of companies
representative of the market structure of 22 developed-market countries in
North America, Europe, and the Asia-Pacific region. You cannot invest in an
index itself.
(3) The Morgan Stanley Capital International ("MSCI") Emerging Markets Global
Index is a market capitalization-weighted index composed of companies
representative of the market structure of 23 emerging market countries in
Europe, Latin America, and the Pacific Basin. You cannot invest in an index
itself.
The MSCI Indices reflect stock market trends by representing the evolution
of an unmanaged portfolio containing a broad selection of domestically
listed companies. Stock selection also takes into consideration the trading
capabilities of foreigners in emerging market countries.
(4) Date that the Fund's Class A shares were first issued to the public.
Investors should realize that all performance data presented is based upon past
performance during limited periods of time, and that past performance is no
guarantee of future performance. Investors should also realize that both
investment return and principal value will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost. The correlation of
performance between an unmanaged index and this Fund is not usually exact.
International investing can involve greater currency fluctuations and less
political and economic stability. Investing in smaller companies can involve
more volatility, less liquidity, and less publicly available information.
Options and futures may not be perfectly correlated to the underlying index or
security.
4
<PAGE>
PORTFOLIO SUMMARY
AS OF DECEMBER 31, 1997
[CHART]
Media 3.9%
Food Service 4.9%
Business Services 5.3%
Consumer/Specialty Retail 7.4%
Communication Services 8.3%
Manufacturing 9.0%
Energy Services 9.2%
Other & Other Liabilities Net 1.1%
Energy 14.8%
Closed-End Funds 13.5%
Food Retail/Wholesale 12.8%
Forest Products/Paper 9.8%
TOP TEN HOLDINGS
1.
CATHAY INVESTMENT FUND, LTD. (9.75%)
A closed-end fund selling on the Hong Kong exchange. Invests in unlisted Chinese
operating companies.
2.
HAIN FOOD GROUP, INC. (8.21%)
Markets specialty food products, including natural, medically directed, and
kosher foods.
3.
CD RADIO, INC. (7.57%)
Holds one of two FCC national satellite radio broadcast licenses. The company is
building a satellite-to-car 50 channel radio system for the broadcast of music
and other programming to motorists throughout the United States.
4.
SINO-FOREST CORPORATION, CLASS A (7.16%)
A Hong Kong-based timberlands company with interests in southern China covering
600,000 hectares of hardwood plantations.
5.
COMPUTALOG, LTD. (5.92%)
Offers oil and gas services to companies in Canada, the United States,
and Venezuela.
6.
HOME SECURITY INTERNATIONAL, INC. (5.03%)
Sells, installs and services residential security alarm systems under the name
`SecurityGuard' through a distribution network in Australia, New Zealand, North
America, Europe and South Africa.
7.
NEW WORLD COFFEE, INC. (4.89%)
Sells roasted coffee beans, coffee beverages and light food items through 30
owned and operated espresso bars in New York, New Jersey and Pennsylvania.
8.
AUTHENTIC SPECIALTY FOODS, INC. (4.57%)
Provides a variety of Mexican food products under the brand names `Calidad' and
`La Victoria' marketed to consumers primarily in southwestern and western
regions of the United States.
9.
MOBILE MINI, INC. (4.55%)
Manufactures, sells, and leases portable steel storage containers,
and telecommunications shelters in the United States.
10.
HALLMARK TECHNOLOGIES, INC. (4.45%)
Engineers, designs and manufactures customized steel molds employed in the
injection molding of precision components, primarily for use within the
automotive industry.
5
<PAGE>
FUND PERFORMANCE - CLASS C SHARES
Results of a hypothetical $10,000 investment
in The Robertson Stephens Global Low-Priced Stock Fund, Russell 2000(1), the
MSCI World(2) and MSCI Emerging Markets Global(3) Indexes
IF INVESTED ON MAY 20, 1997(4)
[GRAPH-Plot points to come]
<TABLE>
<CAPTION>
Cumulative Total Returns
MSCI EMERGING
GLOBAL LOW-PRICED GLOBAL LOW-PRICED RUSSELL 2000 MSCI WORLD MARKETS GLOBAL
FOR THE PERIOD ENDED 12/31/97 STOCK FUND STOCK FUND(5) INDEX(1) INDEX(2) INDEX(3)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Since inception (5/20/97)(4) (14.07)% (14.93)% 19.80% 3.74% (21.51)%
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Russell 2000 Index is a market capitalization-weighted index composed
of 2,000 U.S. companies with market capitalizations ranging from $40
million to $450 million. Investment results assume the reinvestment of
dividends paid on the stocks constituting the index. You cannot invest in
an index itself.
(2) The Morgan Stanley Capital International ("MSCI") World Index is an
unmanaged, market capitalization-weighted index composed of companies
representative of the market structure of 22 developed-market countries in
North America, Europe, and the Asia-Pacific region. You cannot invest in
an index itself.
(3) The Morgan Stanley Capital International ("MSCI") Emerging Markets Global
Index is a market capitalization-weighted index composed of companies
representative of the market structure of 23 emerging market countries in
Europe, Latin America, and the Pacific Basin. You cannot invest in an
index itself.
The MSCI Indices reflect stock market trends by representing the evolution
of an unmanaged portfolio containing a broad selection of domestically
listed companies. Stock selection also takes into consideration the trading
capabilities of foreigners in emerging market countries.
(4) Date that the Fund's Class C shares were first issued to the public.
(5) Reflects the 1% contingent deferred sales charge imposed on redemptions
within the first year of purchasing shares.
Investors should realize that all performance data presented is based upon
past performance during limited periods of time, and that past performance
is no guarantee of future performance. Investors should also realize that
both investment return and principal value will fluctuate so that shares,
when redeemed, may be worth more or less than their original cost. The
correlation of performance between an unmanaged index and this fund is not
usually exact.
International investing can involve greater currency fluctuations and less
political and economic stability. Investing in smaller companies can
involve more volatility, less liquidity, and less publicly available
information. Options and futures may not be perfectly correlated to the
underlying index or security.
6
<PAGE>
SCHEDULE OF INVESTMENTS
<TABLE>
<CAPTION>
DECEMBER 31, 1997 FOREIGN CURRENCY(2) SHARES VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMON STOCKS
- -----------------------------------------------------------------------------------------------------------------------------
BUSINESS SERVICES - 5.3%
Enterprise Solutions Asia Pacific, Ltd.(1) AUD 40,000 $ 6,776
Home Security International, Inc.(1) 60,000 675,000
U-Ship, Inc.(1) 55,800 10,462
U-Ship, Inc., 144A(1)(5) 80,856 15,161
- -----------------------------------------------------------------------------------------------------------------------------
707,399
- -----------------------------------------------------------------------------------------------------------------------------
CLOSED-END FUNDS - 13.5%
Cathay Investment Fund, Ltd. HKD 1,200,000 1,308,641
Romanian Growth Fund, Ltd.(1) 30,686 187,952
Romanian Investment Fund, Ltd.(1) 400 320,000
- -----------------------------------------------------------------------------------------------------------------------------
1,816,593
- -----------------------------------------------------------------------------------------------------------------------------
COMMUNICATIONS SERVICES - 8.3%
CD Radio, Inc.(1) 60,000 1,016,250
Techniche, Ltd.(1) AUD 34,500 25,176
Telecard, Ltd.(1) PKR 95,500 76,498
- -----------------------------------------------------------------------------------------------------------------------------
1,117,924
- -----------------------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE/SERVICES - 0.5%
InfoNow Corporation, 144A(1)(5) 179,986 62,095
- -----------------------------------------------------------------------------------------------------------------------------
62,095
- -----------------------------------------------------------------------------------------------------------------------------
CONSTRUCTION/INFRASTRUCTURE - 1.6%
L&M Group Investments, Ltd., Class A SGD 65,500 21,756
Overseas & General, Ltd.(1) AUD 678,751 34,274
PT Van Der Horst, Ltd., Foreign(6) IDR 285,715 11,688
Van Der Horst, Ltd. SGD 100,000 38,256
Vietnam Industrial Investments, Ltd.(1) AUD 1,521,301 109,032
- -----------------------------------------------------------------------------------------------------------------------------
215,006
- -----------------------------------------------------------------------------------------------------------------------------
CONSUMER GOODS - 1.6%
Wuxi Little Swan Company, Ltd., Class B(1) HKD 200,000 208,040
- -----------------------------------------------------------------------------------------------------------------------------
208,040
- -----------------------------------------------------------------------------------------------------------------------------
ELECTRONIC COMPONENTS - 1.0%
AER Energy Resources, Inc.(1) 125,000 140,625
- -----------------------------------------------------------------------------------------------------------------------------
140,625
- -----------------------------------------------------------------------------------------------------------------------------
ENERGY - 14.8%
Black Sea Energy, Ltd., 144A(1)(5) CAD 128,498 169,700
Black Sea Energy, Ltd., Restricted(1)(3)(7) CAD 76,288 82,319
Calahoo Petroleum, Ltd.(1) CAD 464,600 272,693
Canadian Conquest Exploration, Inc.(1) CAD 295,100 216,508
Eurogas Corporation(1) CAD 170,075 196,083
Highridge Exploration, Ltd.(1) CAD 70,000 195,647
Olympia Energy, Inc., Class A(1) CAD 501,500 175,209
Paragon Petroleum Corporation(1) CAD 90,000 238,969
Place Resources Corporation(1) CAD 294,200 435,806
- -----------------------------------------------------------------------------------------------------------------------------
1,982,934
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
7
<PAGE>
SCHEDULE OF INVESTMENTS (CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31, 1997 FOREIGN CURRENCY(2) SHARES VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ENERGY SERVICES - 9.2%
- -----------------------------------------------------------------------------------------------------------------------------
Bonus Resources Services Corporation(1) CAD 15,000 $ 61,838
Computalog, Ltd.(1) CAD 47,400 794,885
Norton Drilling Services, Inc.(1) 180,000 376,875
- -----------------------------------------------------------------------------------------------------------------------------
1,233,598
- -----------------------------------------------------------------------------------------------------------------------------
FOOD RETAIL/WHOLESALE - 12.8%
Authentic Specialty Foods, Inc.(1) 45,000 613,125
Hain Food Group, Inc.(1) 120,000 1,102,500
- -----------------------------------------------------------------------------------------------------------------------------
1,715,625
- -----------------------------------------------------------------------------------------------------------------------------
FOOD SERVICE - 4.9%
New World Coffee, Inc.(1) 168,000 315,000
New World Coffee, Inc., 144A(1)(5) 182,000 341,250
- -----------------------------------------------------------------------------------------------------------------------------
656,250
- -----------------------------------------------------------------------------------------------------------------------------
FOREST PRODUCTS - 7.2%
Sino-Forest Corporation, Class A, 144A(1)(5) CAD 550,000 960,766
- -----------------------------------------------------------------------------------------------------------------------------
960,766
- -----------------------------------------------------------------------------------------------------------------------------
GOLD MINING - 1.6%
Etruscan Resources, Ltd.(1) CAD 49,800 138,841
General Gold Resources, NL AUD 50 3
Ghana Gold Mines, Ltd.(1) CAD 67,500 58,956
Solomon Resources, Ltd.(1) CAD 75,000 17,294
- -----------------------------------------------------------------------------------------------------------------------------
215,094
- -----------------------------------------------------------------------------------------------------------------------------
MANUFACTURING - 9.0%
Hallmark Technologies, Inc.(1) CAD 68,600 596,772
Mobile Mini, Inc.(1) 105,000 610,312
- -----------------------------------------------------------------------------------------------------------------------------
1,207,084
- -----------------------------------------------------------------------------------------------------------------------------
MEDIA - 3.9%
Metromedia International Group, Inc.(1) 55,000 522,500
- -----------------------------------------------------------------------------------------------------------------------------
522,500
- -----------------------------------------------------------------------------------------------------------------------------
MEDICAL SERVICES - 1.7%
In Home Health, Inc.(1) 250,000 234,375
- -----------------------------------------------------------------------------------------------------------------------------
234,375
- -----------------------------------------------------------------------------------------------------------------------------
SPECIALTY PAPER - 2.6%
Climax International Company HKD 3,500,000 352,326
- -----------------------------------------------------------------------------------------------------------------------------
352,326
- -----------------------------------------------------------------------------------------------------------------------------
SPECIALTY RETAIL - 5.8%
Dress Barn, Inc.(1) 10,000 283,750
One Price Clothing Stores, Inc.(1) 18,500 27,750
Paul Harris Stores, Inc.(1) 15,000 150,937
Sirena Apparel Group, Inc.(1) 80,000 320,000
- -----------------------------------------------------------------------------------------------------------------------------
782,437
- -----------------------------------------------------------------------------------------------------------------------------
TEXTILES - 0.3%
PT Apac Centertex Corporation, Foreign(6) IDR 962,000 34,982
- -----------------------------------------------------------------------------------------------------------------------------
34,982
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
8
<PAGE>
<TABLE>
<CAPTION>
DECEMBER 31, 1997 FOREIGN CURRENCY(2) SHARES VALUE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
TRANSPORTATION EQUIPMENT AND SERVICES - 2.0%
China Yuchai International, Ltd. 100,000 $ 275,000
- -----------------------------------------------------------------------------------------------------------------------------
275,000
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL COMMON STOCK - 107.6% (Cost $14,630,823) 14,440,653
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
WARRANTS
- -----------------------------------------------------------------------------------------------------------------------------
Brazilian Resources, Inc., 1/2 Warrants, Strike CAD 0.50, Expire
3/4/99(1)(3)(4) CAD 45,914 3,346
Etruscan Resources, Ltd., Warrants, Strike CAD 7.50, Expire
4/21/98(1)(3)(4) CAD 24,800 119
Help At Home, Inc., Warrants, Strike $6.00, Expire 12/5/00(1)(4) 325,000 132,031
InfoNow Corporation, 1/2 Warrants, Strike $1.40, Expire
5/20/98(1)(3)(4) 214,286 32,809
NDU Resources, Ltd., 1/2 Warrants, Strike CAD 2.31, Expire
5/17/98(1)(3)(4) CAD 75,000 5,316
PT Apac Centertex Corporation, Warrants, Strike IDR 1,000,
Expire 7/14/01(1)(4) IDR 150,000 627
Solomon Resources, Ltd., 1/2 Warrants, Strike CAD 1.05,
Expire 1/3/98(1)(3)(4) CAD 75,000 -
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL WARRANTS - 1.3% (Cost $715,387) 174,248
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS - 108.9% (Cost $15,346,210) 14,614,901
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
OTHER LIABILITIES, NET - (8.9%) (1,193,022)
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL NET ASSETS - 100.0% $ 13,421,879
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Non-income producing security.
(2) Foreign-denominated security: AUD - Australian Dollar; CAD - Canadian
Dollar; HKD - Hong Kong Dollar; IDR - Indonesian Rupiah;
PKR - Pakistan Rupee; SGD - Singapore Dollar.
(3) Fair-value security. See 1.a. in Notes to Financial Statements.
(4) See 4.d. in Notes to Financial Statements.
(5) These securities may be resold in transactions exempt from
registration, under Rule 144A of the Securities Act of 1933,
normally to qualified institutional buyers.
(6) Shares registered for foreign investors.
(7) Restricted Security. See 4.c. in Notes to Financial Statements.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
9
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
DECEMBER 31, 1997
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
ASSETS
- -----------------------------------------------------------------------------------------------------------------------------
Investments, at value (Cost: $15,346,210) $ 14,614,901
Receivable for investments sold 583,492
Organizational cost 11,873
Dividends receivable 11,513
Receivable for fund shares subscribed 7,719
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS 15,229,498
- -----------------------------------------------------------------------------------------------------------------------------
LIABILITIES
- -----------------------------------------------------------------------------------------------------------------------------
Payable for fund shares redeemed 993,342
Payable to custodian bank 704,736
Accrued expenses 109,406
Payable to adviser 135
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 1,807,619
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL NET ASSETS 13,421,879
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
NET ASSETS CONSIST OF:
- -----------------------------------------------------------------------------------------------------------------------------
Paid-in capital 14,939,199
Accumulated net realized loss from investments (757,392)
Net unrealized depreciation on investments (759,928)
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL NET ASSETS $ 13,421,879
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
Pricing of Shares:
Net Asset Value, offering and redemption price per share - Class A Shares $ 11.17
(Net assets of $ 13,370,575 applicable to 1,197,410 shares of
beneficial interest with no par value)
- -----------------------------------------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share - Class C Shares $ 11.04
(Net assets of $ 51,304 applicable to 4,646 shares of
beneficial interest with no par value)(1)
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Redemption price per share is equal to the net asset value less any
applicable contingent deferred sales charge.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
10
<PAGE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C>
FOR THE YEAR ENDED DECEMBER 31, 1997
- -----------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
- -----------------------------------------------------------------------------------------------------------------------------
Interest $ 134,129
Dividends 74,271
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 208,400
- -----------------------------------------------------------------------------------------------------------------------------
EXPENSES
- -----------------------------------------------------------------------------------------------------------------------------
Investment advisory fees 268,296
Custodian fees 95,238
Transfer agent fees 68,804
Administrative services fees 67,074
Distribution fees - Class A shares 66,988
Professional fees 53,177
Registration and filing fees 38,283
Trustees' fees and expenses 22,265
Shareholder reports 9,500
Organization expense 3,840
Interest expense 3,085
Insurance 407
Distribution fees - Class C shares 259
Shareholder servicing fees - Class C shares 86
- -----------------------------------------------------------------------------------------------------------------------------
Total Expenses 697,302
Less: Expense waiver by adviser (173,776)
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSES, NET 523,526
- -----------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT LOSS (315,126)
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
REALIZED GAIN/(LOSS) AND UNREALIZED APPRECIATION/(DEPRECIATION) ON INVESTMENTS
- -----------------------------------------------------------------------------------------------------------------------------
Net realized loss on investments (975,079)
Net change in unrealized depreciation on investments (1,652,806)
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL NET REALIZED LOSS AND UNREALIZED DEPRECIATION ON INVESTMENTS (2,627,885)
- -----------------------------------------------------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $(2,943,011)
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
11
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE FOR THE
YEAR ENDED YEAR ENDED
DECEMBER 31, 1997 DECEMBER 31, 1996
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS
- -----------------------------------------------------------------------------------------------------------------------------
Net investment loss $ (315,126) $ (131,605)
Net realized (loss)/gain on investments (975,079) 349,292
Net change in unrealized (depreciation)/appreciation on investments (1,652,806) 872,069
- -----------------------------------------------------------------------------------------------------------------------------
NET (DECREASE)/INCREASE IN NET ASSETS RESULTING FROM OPERATIONS (2,943,011) 1,089,756
- -----------------------------------------------------------------------------------------------------------------------------
DISTRIBUTION TO SHAREHOLDERS
- -----------------------------------------------------------------------------------------------------------------------------
Net investment income - Class A Shares - (2,077)
Net investment income - Class C Shares(1) - -
Realized gain on investments - Class A Shares (777,468) -
Realized gain on investments - Class C Shares(1) (2,993) -
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS (780,461) (2,077)
- -----------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
- -----------------------------------------------------------------------------------------------------------------------------
Net (decrease)/increase in net assets resulting from capital share transactions (14,295,330) 28,709,614
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL (DECREASE)/INCREASE IN NET ASSETS (18,018,802) 29,797,293
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------------
Beginning of period 31,440,681 1,643,388
End of period $ 13,421,879 $ 31,440,681
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Class C shares were first issued on May 20, 1997.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
12
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS A SHARES
<TABLE>
<CAPTION>
FOR THE FOR THE FOR THE
FOR A SHARE OUTSTANDING YEAR ENDED YEAR ENDED PERIOD ENDED
THROUGHOUT EACH PERIOD: 12/ 31/97 12/31/96 12/31/95(1)(3)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.52 $ 10.45 $ 10.00
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Net investment (loss)/income (0.16) (0.09) 0.03
Net realized (loss)/gain and unrealized
(depreciation)/appreciation on investments (1.63) 3.17 0.42
- ----------------------------------------------------------------------------------------------------------------------------------
Net (Decrease)/Increase in Net Assets Resulting From Operations (1.79) 3.08 0.45
- ----------------------------------------------------------------------------------------------------------------------------------
Distributions from net investment income - (0.01) -
Distributions from realized gain on investments (0.56) - -
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 11.17 $ 13.52 $ 10.45
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (13.54)% 29.39% 4.50%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period (000s) $ 13,371 $ 31,441 $ 1,643
Ratio of Expenses to Average Net Assets 1.95% 1.94%(2) 1.91%(2)
Ratio of Net Investment (Loss)/Income to Average Net Assets (1.17)% (0.67)%(2) 2.06%(2)
Portfolio Turnover Rate 65% 66% 0%
Average Commission Rate Paid(4) $ 0.0096 $ 0.0134 -
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Class A Shares were first issued on November 15, 1995.
(2) If the Fund had paid all of its expenses and there had been no
reimbursement from the Adviser for the year ended December 31, 1997, for
the year ended December 31, 1996, and for the period from November 15, 1995
(Commencement of Operations) to December 31, 1995, total return would have
been (14.70)%, 28.43%, and 4.10%, respectively, the ratio of expenses to
average net assets would have been 2.60%, 3.14%, and 9.04%, respectively,
and the ratio of net investment loss to average net assets would have been
(1.82)%, (1.87)%, and (5.07)%, respectively.
(3) Ratios, except for total return and portfolio turnover rate, have been
annualized.
(4) A fund is required to disclose its average commission rate per share for
security trades on which a commission is charged. This amount may vary
from fund to fund and period to period depending on the mix of trades
executed in various markets where trading practices and commission rate
structures may differ. This rate generally does not reflect markups,
markdowns or spreads on shares traded on a principal basis, if any.
Per-share data with respect to Class A shares for each period has been
determined by using the average number of Class A shares outstanding
throughout each period. Distributions reflect actual per-share amounts
distributed for the periods.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
13
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS C SHARES
<TABLE>
<CAPTION>
FOR THE
FOR A SHARE OUTSTANDING PERIOD ENDED
THROUGHOUT THE PERIOD: 12/31/97(1)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.45
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Net investment loss (0.16)
Net realized loss and net change in unrealized depreciation on investments (1.69)
- ---------------------------------------------------------------------------------------------------------------------------------
Net Decrease in Net Assets Resulting From Operations (1.85)
- ---------------------------------------------------------------------------------------------------------------------------------
Distributions from net investment income -
Distributions from realized gain on investments (0.56)
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $ 11.04
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (14.07)%
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ---------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period (000s) $ 51
Ratio of Expenses to Average Net Assets 2.45%(2)
Ratio of Net Investment Loss to Average Net Assets (1.95)%(2)
Portfolio Turnover Rate 65%
Average Commission Rate Paid(3) $ 0.0096
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Class C shares were first issued on May 20, 1997.
(2) If the Fund had paid all of its expenses and there had been no
reimbursement from the Adviser for the period from May 20, 1997
(Commencement of Operations) through December 31, 1997, total return
would have been (14.46)%, the ratio of expenses to average net assets would
have been 3.10%, and the ratio of net investment loss to average net assets
would have been (2.60)%.
(3) A fund is required to disclose its average commission rate per share for
security trades on which a commission is charged. This amount may vary
from fund to fund and period to period depending on the mix of trades
executed in various markets where trading practices and commission rate
structures may differ. This rate generally does not reflect markups,
markdowns or spreads on shares traded on a principal basis, if any.
Ratios, except for total return and portfolio turnover rate, have been
annualized. Total returns do not include the 1% contingent deferred sales
charge.
Per-share data with respect to Class C shares for the period has been
determined by using the average number of Class C shares outstanding
throughout the period. Distributions reflect actual per-share amounts
distributed for the period.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
14
<PAGE>
NOTES TO FINANCIAL STATEMENTS
The Robertson Stephens Global Low-Priced Stock Fund (the "Fund") is a series of
the Robertson Stephens Investment Trust (the "Trust"), a Massachusetts business
trust organized on May 11, 1987. The Fund is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as a diversified, open-end
management investment company. The Fund became effective to offer shares to the
public on November 15, 1995. The Trust offers twelve series of shares -- The
Robertson Stephens Emerging Growth Fund, The Robertson Stephens Value + Growth
Fund, The Contrarian Fund-TM-, The Robertson Stephens Developing Countries Fund,
The Robertson Stephens Growth & Income Fund, The Robertson Stephens Partners
Fund, The Information Age Fund-TM-, The Robertson Stephens Global Natural
Resources Fund, The Robertson Stephens Global Low-Priced Stock Fund, The
Robertson Stephens Diversified Growth Fund, The Robertson Stephens MicroCap Fund
and The Robertson Stephens Global Value Fund. The assets for each series are
segregated and accounted for separately.
The Trustees have authorized the issuance of two classes of shares of beneficial
interest of the Fund, designated as Class A and C, respectively. The shares of
each class represent an interest in the same portfolio of investments of the
Fund. Expenses of the Fund are borne pro-rata by the holders of each class of
shares, except that each class may bear expenses unique to that class
(including, but not limited to, distribution expenses applicable to such class).
Shares of each class would receive their pro-rata share of the net assets of the
Fund, if the Fund was liquidated. In addition, the Board of Trustees declares
separate distributions on each class of shares. Each class votes as a class
only with respect to its own distribution plan or other matters for which a
class vote is required by law or determined by the Board of Trustees. Class C
shares were first issued by the Fund on May 20, 1997. Class C shares are
subject to a 1% contingent deferred sales charge if those shares are redeemed
within one year of purchase.
NOTE 1 SIGNIFICANT ACCOUNTING POLICIES:
The following policies are in conformity with generally accepted accounting
principles.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
a. INVESTMENT VALUATIONS:
Marketable securities are valued at the last sale price on the principal
exchange or market on which they are traded; or, if there were no sales that
day, at the mean between the closing bid and asked prices. Short-term
investments that will mature in 60 days or less are stated at amortized cost,
which approximates market value. Foreign securities prices are generally
denominated in foreign currencies. The currencies are translated into U.S.
dollars by using the exchange rates at the close of The London Stock Exchange
prior to when the Fund's net asset value is next determined. At December 31,
1997, 99.2% of the Fund's positions were valued in this manner.
Securities for which market quotations are not readily available are valued at
their fair value as determined in accordance with the guidelines and procedures
adopted by the Fund's Board of Trustees. The guidelines and procedures use
fundamental valuation methods which include, but are not limited to, the
analysis of: the effect of any restrictions on the sale of the security, product
development and trends of the security's issuer, changes in the industry and
other competing companies, significant changes in the issuer's financial
position, and any other event which would have a significant impact on the value
of a security. At December 31, 1997, approximately 0.8% of the Fund's positions
were valued using these guidelines and procedures.
As its normal course of business, the Fund has invested a significant portion of
its assets in companies concentrated within a number of industries involving
energy/energy services, specialty retail and closed-end funds. Accordingly, the
performance of the Fund may be subject to a greater risk of market fluctuation
than that of a fund invested in a wider spectrum of market or industrial
sectors.
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
b. REPURCHASE AGREEMENTS:
Repurchase agreements are fully collateralized by U.S. government securities.
All collateral is held by the Fund's custodian and is monitored daily to ensure
that the collateral's market value equals at least 100% of the repurchase price
under the agreement. However, in the event of default or bankruptcy, realization
and/or retention of the collateral may be subject to legal proceedings. The
Fund's policy is to limit repurchase agreement transactions to those parties
deemed by the Fund's Investment Adviser to have satisfactory creditworthiness.
c. FEDERAL INCOME TAXES:
The Fund intends to comply with requirements of the Internal Revenue Code,
qualifying as a regulated investment company. Therefore, the Fund does not
expect to be subject to income tax, and no provision for such tax will be made.
d. SECURITIES TRANSACTIONS:
Securities transactions are accounted for on the date securities are purchased
or sold (trade date). Realized gains or losses on securities transactions are
determined on the basis of specific identification.
e. FOREIGN CURRENCY TRANSLATION:
The accounting records of the Fund are maintained in U.S. dollars. Investments
securities and all other assets and liabilities of the Fund denominated in a
foreign currency are translated into U.S. dollars at the exchange rate each day.
Purchases and sales of securities, income receipts, and expense payments are
translated into U.S. dollars at the exchange in effect on the dates of the
respective transactions.
The Fund does not isolate the portion of the fluctuations on investments
resulting from changes in foreign currency exchange rates from the fluctuations
in market prices of investments held. Such fluctuations are included with the
net realized and unrealized gain or loss from investments.
f. INVESTMENT INCOME:
Dividend income is recorded on the ex-dividend date, except certain cash
dividends from foreign securities which are recorded as soon as the Fund is
informed of the ex-dividend date. Interest income, which includes accretion of
original issue discount, is accrued and recorded daily.
g. EXPENSES:
Most expenses of the Trust can be directly attributed to a specific fund.
Expenses which cannot de directly attributed to a specific fund are apportioned
between the funds in the Trust.
h. DISTRIBUTIONS TO SHAREHOLDERS:
Dividends to shareholders are recorded on the ex-dividend date. Income and
capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
Permanent book and tax basis differences relating to shareholder distributions
will result in reclassifications to paid in capital. Undistributed net
investment income and accumulated undistributed net realized gain/(loss) on
investments and foreign currency transactions may include temporary book and tax
differences which will reverse in a subsequent period. During any particular
year net realized gains from investment transactions, in excess of available
capital loss carryforwards, would be taxable to the Fund if not distributed and,
therefore, will be distributed to shareholders annually. Any taxable income or
gain remaining at fiscal year end is distributed in the following year.
16
<PAGE>
i. CLASS ALLOCATIONS:
Income, common expenses, and realized and unrealized gains/(losses) are
determined at the Fund level and allocated daily to each class of shares based
on the appropriate net assets of the respective classes. Transfer agent
expenses, distribution/shareholder service fees, and any other class specific
expenses, if any, are calculated daily at the class level based on the
appropriate net assets of each class and the specific expense rate applicable to
each class.
j. CAPITAL ACCOUNTS:
Due to the timing of dividend distributions and the differences in accounting
for income and realized gains/(losses) for financial statement and federal
income tax purposes, the fiscal year in which amounts are distributed may differ
from the year in which the income and realized gains/(losses) were recorded by
the Fund.
k. TEMPORARY BORROWINGS:
The Fund and several affiliated funds share in a $15 million, uncommitted
revolving credit and/or overdraft protection facility from the Fund's custodian
bank for temporary borrowing purposes, including the meeting of redemption
requests that otherwise might require the untimely disposition of securities.
Interest is calculated based on the market rates at the time of borrowing. The
Fund may borrow up to a maximum of 33 percent of its total assets under the
agreement.
NOTE 2 CAPITAL SHARES:
a. TRANSACTIONS:
The Fund has authorized an unlimited number of shares of beneficial interest
with no par value divided into two classes designated Class A and Class C.
Transactions in capital shares for Class A for the year ended December 31, 1997,
and for the year ended December 31, 1996, and for Class C shares for the period
from May 20, 1997
(Commencement of Operations), to December 31, 1997, were as follows:
Class A
<TABLE>
<CAPTION>
1/1/97 - 12/31/97 SHARES AMOUNT
- ---------------------------------------------------------------------------
<S> <C> <C>
Shares sold 2,307,991 $ 32,417,540
Shares reinvested 61,625 740,738
- ---------------------------------------------------------------------------
2,369,616 33,158,278
- ---------------------------------------------------------------------------
Shares redeemed (3,498,003) (47,519,821)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Net decrease (1,128,387) $(14,361,543)
- ---------------------------------------------------------------------------
1/1/96 - 12/31/96 SHARES AMOUNT
- ---------------------------------------------------------------------------
Shares sold 4,496,553 $ 59,273,573
Shares reinvested 150 2,030
- ---------------------------------------------------------------------------
4,496,703 59,275,603
- ---------------------------------------------------------------------------
Shares redeemed (2,328,173) (30,565,989)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Net increase 2,168,530 $ 28,709,614
- ---------------------------------------------------------------------------
Class C
5/20/97* - 12/31/97 SHARES AMOUNT
- ---------------------------------------------------------------------------
Shares sold 5,684 $ 78,089
Shares reinvested 251 2,992
- ---------------------------------------------------------------------------
5,935 81,081
- ---------------------------------------------------------------------------
Shares redeemed (1,289) (14,868)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Net increase 4,646 $ 66,213
- ---------------------------------------------------------------------------
</TABLE>
*Class C shares were first issued on May 20, 1997.
NOTE 3 TRANSACTIONS WITH AFFILIATES:
a. ADVISORY FEES AND EXPENSE LIMITATION:
Under the terms of an advisory agreement, which is reviewed and approved
annually (beginning in 2000) by the Board of Trustees, the Fund pays Robertson,
Stephens & Company Investment Management, L.P.
17
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
("RSIM, L.P."), an investment advisory fee and an administrative services fee
calculated at an annual rate of 1.00% and 0.25%, respectively, of the average
daily net assets of the Fund. For the year ended December 31, 1997, the Fund
incurred investment advisory fees and administrative fees of $268,296 and
$67,074 respectively. RSIM, L.P. voluntarily agreed to waive any annual
operating expenses, excluding the expense differential between Class A and Class
C, of the Fund's Class A and Class C shares exceeding an annual expense ratio of
1.95%. For the year ended December 31, 1997, and for the period from May 20,
1997 (Commencement of Operations), through December 31, 1997, RSIM, L.P. agreed
to waive fees and other expenses of $119,776 for Class A shares and $224 for
Class C shares, respectively.
RSIM, L.P. may recoup waived or reimbursed operating expenses over the
succeeding two years, subject to expense limitations then applicable to the
Fund. No previous expense waivers or reimbursements of operating expenses were
recouped by RSIM, L.P. from the Fund during the year ended December 31, 1997.
b. COMPENSATION OF TRUSTEES AND OFFICERS:
Trustees and officers of the Trust who are interested persons of the Trust
receive no compensation from the Trust. Trustees of the Trust who are not
interested persons of the Trust, as defined in the 1940 Act, collectively
received compensation and reimbursement of expenses of $22,265 for the year
ended December 31, 1997.
c. DISTRIBUTION FEES:
For the period from January 1, 1997, through September 30, 1997, the Fund
entered into agreements with Robertson, Stephens & Company LLC ("RS&Co.") for
distribution services with respect to its Class A and Class C shares and adopted
Plans of Distribution pursuant to Rule 12b-1 under the 1940 Act, where
continuance is reviewed annually by the Fund's Board of Trustees. Under these
Plans, RS&Co. was compensated for services in such capacity including its
expenses in connection with the promotion and distribution of the Fund's Class A
and Class C shares. The distribution fees for Class A and Class C shares are
calculated at an annual rate of 0.25% and 0.75%, respectively, based on the
average daily net assets attributed to each class of shares, although the Class
C Plan contemplates payments at a rate of up to 1% of the Fund's average net
assets attributable to Class C shares. For the period from January 1, 1997,
through September 30, 1997, for Class A, and for the period from May 20, 1997
(Commencement of Operations), through September 30, 1997, for Class C, the Fund
paid distribution fees of $53,776 and $138, respectively, to RS&Co. For this
same period, RS&Co. agreed to waive distribution fees for Class A of $53,776.
On October 1, 1997, BankAmerica Corporation ("BAC") became the owner of the
entire beneficial interest in RSIM, L.P. (See note 5.a. in Notes to the
Financial Statements). As part of that acquisition, BAC also became the owner
of the entire beneficial interest in RSIM's affiliate, BancAmerica Robertson
Stephens (formerly Robertson Stephens & Company LLC). Pursuant to certain laws
and regulations that apply to bank holding companies and their affiliates, a
bank holding company-affiliated broker-dealer may not serve as the distributor
or principal underwriter of mutual funds. Commencing October 1, 1997, Edgewood
Services, Inc., a non-affiliate, has been designated the Fund's new distributor.
d. SHAREHOLDER SERVICING FEE:
The Trust has adopted a Shareholder Servicing Plan for the Class C shares of
each fund. Under the Plan, each fund pays fees to BancAmerica Robertson Stephens
("BARS") at an annual rate of up to 0.25% of the fund's average daily net assets
of the Class C shares. The Plan contemplates that financial institutions will
enter into shareholder service agreements with BARS to provide administrative
support services to their customers who are fund shareholders. In return for
providing these support services, a financial institution may receive payments
from BARS at a rate not exceeding 0.25% of the average daily net assets of the
Class C shares of each fund for which the financial institution is the financial
institution of record. For the period from May 20, 1997 (Commencement of
Operations) through December 31, 1997, for Class C shares, the Fund incurred
shareholder servicing fees of $86.
18
<PAGE>
e. BROKERAGE COMMISSIONS:
RSIM, L.P. may direct orders for investment transactions to BARS as
broker-dealer, subject to Fund policies as stated in the prospectus, regulatory
constraints, and the ability of BARS to provide competitive prices and
commission rates. All investment transactions in which BARS acts as a broker may
only be executed on an agency basis. Subject to certain constraints, the Fund
may make purchases of securities from offerings or underwritings in which BARS
has been retained by the issuer. For the year ended December 31, 1997, the Fund
paid brokerage commissions of $1,520 to BARS, which represented 1.7% of total
commissions paid during the year.
NOTE 4 INVESTMENTS:
a. TAX BASIS OF INVESTMENTS:
At December 31, 1997, the cost of investments for federal income tax purposes
was $15,346,210. Accumulated net unrealized depreciation on investments,
excluding the foreign currency fluctuation associated with other assets and
liabilities, was $731,309, consisting of gross unrealized appreciation and
depreciation of $3,930,163 and $4,661,472, respectively.
b. INVESTMENT PURCHASES AND SALES:
For the year ended December 31, 1997, the cost of investments purchased and the
proceeds from investments sold (excluding short-term investments) were
$15,368,578 and $23,230,826, respectively.
c. RESTRICTED SECURITIES:
A restricted security cannot be resold to the general public without prior
registration under the Securities Act of 1933. If the security is subsequently
reregistered and resold, the issuers would bear the expense of all registrations
at no cost to the Fund. At December 31, 1997, the Fund held restricted
securities with an aggregate value of $82,319, which represented 0.6% of the
Fund's net assets. Restricted securities are valued according to the guidelines
and procedures adopted by the Fund's Board of Trustees as outlined in Note 1.a.,
paragraph 2.
<TABLE>
<CAPTION>
SHARES COST VALUE ACQUISITION
SECURITY (000) (000) (000) DATE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Black Sea Energy, Ltd. 76 $92 $82 1/03/97
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
d. OPTIONS AND WARRANTS:
Options and warrants normally entitle the holder to purchase a proportionate
amount of a particular class of the issuer's securities at a predetermined price
during a specific period. Options and warrants for which market quotations were
not readily available were priced using the modified Black-Scholes Valuation
Formula. The Black-Scholes Valuation Formula values an option or warrant by
determining the differential between the exercise price of the option or warrant
and the current price of the underlying stock based on a number of factors.
These factors include, but are not limited to, current price of the underlying
stock, exercise price of the option or warrant, time to expiration, assumed
riskless rate of interest, compounded rate of return on the stock, and standard
deviation of the return on the stock. This valuation method is subject to
frequent review and is in accordance with the guidelines and procedures adopted
by the Fund's Board of Trustees.
e. FOREIGN SECURITIES:
Foreign securities investments involve special risks and considerations not
typically associated with those of U.S. origin. These risks include, but are
not limited to, revaluation of currencies, adverse political, social, and
economic developments, and less reliable information about issuers. Moreover,
securities of many foreign companies and markets may be less liquid and their
prices more volatile than those of U.S. companies and markets.
NOTE 5 ACQUISITION:
On October 1, 1997, BankAmerica Corporation completed its acquisition of
Robertson, Stephens & Company Group, L.L.C. and Robertson, Stephens & Company,
Inc. Pursuant to that acquisition, BankAmerica Corporation became the owner of
the entire beneficial interest in RSIM, L.P.
19
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees and Shareholders of The Robertson Stephens Global
Low-Priced Stock Fund
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The Robertson Stephens Global
Low-Priced Stock Fund (the "Fund") at December 31, 1997, and the results of its
operations and the changes in its net assets and the financial highlights for
each of the periods presented, in conformity with generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Fund's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards, which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at December 31, 1997, by correspondence with the
custodian and brokers, and the application of alternative auditing procedures
where confirmations from brokers were not received, provide a reasonable basis
for the opinion expressed above.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
San Francisco, California
February 7, 1998
ADMINISTRATION
OFFICERS AND TRUSTEES
Andrew P. Pilara, Jr., Trustee
President
Leonard B. Auerbach, Trustee
President and Chairman of Auerbach
Associates, Inc.
John W. Glynn, Jr., Trustee
Principal and Chairman of
Glynn Capital Management
James K. Peterson, Trustee
Former Director of the IBM
Retirement Funds
Terry R. Otton
Chief Financial Officer
Dana K. Welch
Secretary
INVESTMENT ADVISER
Robertson, Stephens & Company
Investment Management, L.P.
555 California Street, Suite 2600
San Francisco, CA 94104
DISTRIBUTOR
Edgewood Services, Inc.
Clearing Operations
P.O. Box 897
Pittsburgh, PA 15230-0897
TRANSFER AGENT AND DISBURSING AGENT
State Street Bank & Trust Company
c/o National Financial Data Services
Kansas City, MO
1-800-272-6944
CUSTODIAN
State Street Bank & Trust Company
Boston, MA
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
San Francisco, CA
LEGAL COUNSEL
Ropes & Gray
Boston, MA
This report is submitted for the information of shareholders of The Robertson
Stephens Global Low-Priced Stock Fund. It is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective prospectus.
Published February 13, 1998
20
<PAGE>
Design: Broom & Broom, Inc., San Francisco
Photography: Jerry Orabona, Bill Zemanek
ROBERTSON STEPHENS MUTUAL FUNDS
The Robertson Stephens Mutual Funds
VALUE
THE PARTNERS FUND
A SMALL-CAP FUND USING A
CASH FLOW VALUE METHODOLOGY
Managed by Andrew Pilara.
GROWTH & INCOME
THE GROWTH & INCOME FUND
SEEKING GROWTH WHILE
ATTEMPTING TO MODERATE RISK
Managed by John Wallace.
GROWTH
THE DIVERSIFIED GROWTH FUND
FOCUSING ON SMALL- AND
MID-CAP COMPANIES
Managed by John Wallace
and John Seabern.
THE EMERGING GROWTH FUND
SEEKING TO INVEST IN AMERICA'S
MOST DYNAMIC, GROWTH-
ORIENTED COMPANIES
Managed by Jim Callinan.
THE INFORMATION AGE FUND-TM-
TARGETING INVESTMENTS IN THE
INFORMATION TECHNOLOGY SECTOR
Managed by Ron Elijah
and Rod Berry.
THE MICROCAP GROWTH FUND
FOCUSING ON COMPANIES WITH MARKET
CAPS OF LESS THAN $250 MILLION
Managed by Dave Evans
and Rainerio Reyes.
THE VALUE + GROWTH FUND
A GROWTH FUND FOR THE
LONG-TERM INVESTOR
Managed by Ron Elijah.
GLOBAL
THE CONTRARIAN FUND-TM-
A GLOBAL HEDGE FUND
Managed by Paul Stephens.
THE GLOBAL LOW-PRICED STOCK FUND
SEEKING OVERLOOKED AND UNDERVALUED
COMPANIES
Managed by Hannah Sullivan.
THE GLOBAL NATURAL RESOURCES FUND
PRIMARILY FOCUSING ON HARD
ASSET COMPANIES
Managed by Andrew Pilara.
THE GLOBAL VALUE FUND
SEEKING UNDERVALUED
INVESTMENTS WORLDWIDE
Managed by Andrew Pilara.
INTERNATIONAL
THE DEVELOPING COUNTRIES FUND
LOOKING FOR GROWING COMPANIES
IN EMERGING MARKETS
Managed by Michael Hoffman.
Please read the prospectus to learn about the Funds' objectives, investment
policies, and the special risks associated with The Robertson Stephens Mutual
Funds, including international investing, investing in smaller companies,
investing in a more limited number of issuers and sectors or a particular
sector, short selling, using options and futures, and investing in
high-yielding, lower-quality debt securities.
Mutual fund shares are not insured by the FDIC or any other governmental entity;
are not deposits or other obligations of, or guaranteed by Bank of America or
any of its affiliates; and are subject to investment risks, including possible
loss of the principal amount invested.
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ROBERTSON STEPHENS FUNDS
BRINGING THE FUND MANAGER TO YOU
555 California Street, Suite 2600
San Francisco, California 94104
Fund News & Information
ROBERTSON STEPHENS INVESTOR SERVICES
- - Knowledgeable mutual fund representatives.
- - Automated access to daily net asset values.
- - Portfolio Manager Hotline, 24 hours a day.
1-800-766-3863
ROBERTSON STEPHENS
MUTUAL FUND E-MAIL
[email protected]
ROBERTSON STEPHENS
ON THE WEB
http://www.rsim.com
ROBERTSON STEPHENS
ACCOUNTLINK
- - Automated account information, 24 hours a day.
l-800-624-8025
FUND LISTINGS
The Fund is listed in THE WALL STREET JOURNAL, USA TODAY, INVESTOR'S BUSINESS
DAILY, and most local newspapers as LowPrc under the heading Robertson Stephens.
Its computer quotation symbol is RSLPX.
The views expressed in this report were those of the Fund's portfolio manager as
of the date specified, and may not reflect the views of the portfolio manager on
the date they are first published or at any other time thereafter. RSIM and its
affiliates may buy or sell investments at any time for the Fund, their other
clients or for their own accounts, and may not necessarily do so in a manner
consistent with the views expressed in this report. The prices at which they buy
or sell investments may be affected favorably by the contents of this report or
the timing of its publication. THE VIEWS EXPRESSED IN THIS REPORT ARE INTENDED
TO ASSIST SHAREHOLDERS OF THE FUND IN UNDERSTANDING THEIR INVESTMENT IN THE FUND
AND DO NOT CONSTITUTE INVESTMENT ADVICE; INVESTORS SHOULD CONSULT THEIR OWN
INVESTMENT PROFESSIONALS AS TO THEIR INDIVIDUAL INVESTMENT PROGRAMS.
