SMITH HAYES
TRUST, INC.
ASSET ALLOCATION
BALANCED
CONVERTIBLE
SMALL CAP
VALUE
GOVERNMENT/QUALITY BOND
ANNUAL REPORT
JUNE 30, 1995
<PAGE>
TABLE OF CONTENTS
Shareholder Letter................................. 1
Comparison Graphs
Asset Allocation Portfolio...................... 2
Balanced Portfolio.............................. 2
Convertible Portfolio........................... 3
Small Cap Portfolio............................. 3
Value Portfolio................................. 4
Government/Quality Bond Portfolio............... 4
Independent Auditors' Report....................... 5
Schedule of Investments
Asset Allocation Portfolio...................... 6
Balanced Portfolio.............................. 9
Convertible Portfolio........................... 12
Small Cap Portfolio............................. 15
Value Portfolio................................. 18
Government/Quality Bond Portfolio............... 22
Statement of Assets and Liabilities
Asset Allocation Portfolio...................... 23
Balanced Portfolio.............................. 23
Convertible Portfolio........................... 23
Small Cap Portfolio............................. 24
Value Portfolio................................. 24
Government/Quality Bond Portfolio............... 24
<PAGE>
TABLE OF CONTENTS (CONTINUED)
Statement of Operations
Asset Allocation Portfolio...................... 25
Balanced Portfolio.............................. 25
Convertible Portfolio........................... 25
Small Cap Portfolio............................. 26
Value Portfolio................................. 26
Government/Quality Bond Portfolio............... 26
Statements of Changes in Net Assets
Asset Allocation Portfolio...................... 27
Balanced Portfolio.............................. 27
Convertible Portfolio........................... 28
Small Cap Portfolio............................. 28
Value Portfolio................................. 29
Government/Quality Bond Portfolio............... 29
Financial Highlights
Asset Allocation Portfolio...................... 30
Balanced Portfolio.............................. 31
Convertible Portfolio........................... 32
Small Cap Portfolio............................. 33
Value Portfolio................................. 34
Government/Quality Bond Portfolio............... 35
Notes to Financial Statements...................... 36
<PAGE>
SMITH HAYES TRUST, INC.
FELLOW SHAREHOLDERS:
The return from both the stock and bond markets were extremely favorable for the
fiscal year ended June 30, 1995. Within this time frame, the returns were
significantly different for the two six-month time periods. During the six-month
period ended December 31, 1994, the Federal Reserve Board extended its policy
initiated at the beginning of the year by increasing the Federal Funds rate
twice. Consequently, interest rates increased during the period and the returns
from both bonds and stocks were limited. However, in spite of an additional
increase in the Federal Funds rate in late January 1995, interest rates declined
throughout the six months ended June 30, 1995. Subsequent to the end of the
fiscal year the Federal Reserve, in response to a deceleration in the growth of
the economy as well as a moderation in the rate of inflation, reversed its
previous policy and reduced the Federal Funds rate.
In recognition of the decline in interest rates as well as the growth in
corporate earnings, the stock market had a relatively strong performance in the
first half of 1995. In fact, the increase of 20.2% for the S&P 500 Index during
the 6 months ended June 30, 1995 was among the 5 best first-half rallies over
the last 20 years. For the 12 months ended June 30, 1995 the S&P 500 Index
increased 26.1%. Similar to the market averages, our portfolios showed much
stronger performances during the six months ended June 30, 1995. The returns of
the individual portfolios are included in the following tabulations.
Presently, most economists are of the opinion that the economy will continue to
expand at a moderate rate throughout 1995 and 1996. At the same time, new
efficiencies in production and competition on an international basis are
anticipated to restrain the rate of inflation. Hence, a "soft landing", one
where growth will slow enough to eliminate the threat of inflation but not
enough to cause a recession.
As previously reported, Conley Investment Counsel and SMITH HAYES Portfolio
Management, Inc. have merged to form CONLEY SMITH, Inc., a subsidiary of the
parent, Consolidated Investment Corporation. In conjunction with the formation
of CONLEY SMITH, Inc., the Capital Builder Fund was created as a new fund within
the SMITH HAYES Trust. If you have any questions regarding your investment,
please do not hesitate to call your SMITH HAYES Trust account representative.
Sincerely,
John H. Conley
President July 20, 1995
<PAGE>
GRAPH
- -----
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
ASSET ALLOCATION PORTFOLIO AND THE LIPPER BALANCED INDEX
AVG. ANNUAL RETURN 06/30/95
1 YEAR 19.10% ASSET ALLOCATION $17,622.64
5 YEAR 9.62% LIPPER BALANCED $20,689.87
INCEPTION 8.40%
GRAPH
- -----
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
BALANCED PORTFOLIO AND THE LIPPER BALANCED INDEX
AVG. ANNUAL RETURN 06/30/95
1 YEAR 11.18% BALANCED $16,047.14
5 YEAR 6.66% LIPPER BALANCED $20,689.87
INCEPTION 6.97%
Past performance is not predictive of future performance.
For the period June 23, 1988 (inception) through June 30, 1995.
<PAGE>
GRAPH
- -----
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
CONVERTIBLE PORTFOLIO AND THE LIPPER BALANCED INDEX
AVG. ANNUAL RETURN 06/30/95
1 YEAR 14.09% CONVERTIBLE $17,225.36
5 YEAR 10.03% LIPPER BALANCED $20,689.87
INCEPTION 8.05%
GRAPH
- ------
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
SMALL CAP PORTFOLIO AND THE S&P 400 MIDCAP INDEX
AVG. ANNUAL RETURN 06/30/95
1 YEAR 20.33% SMALL CAP $14,347.60
S&P 400 MIDCAP $14,658.06
INCEPTION 12.81%
Past performance is not predictive of future performance. Convertible Portfolio
for the period June 23, 1988 (inception) through June 30, 1995. Small Cap
Portfolio for the period July 1, 1992 (inception) through June 30, 1995.
<PAGE>
GRAPH
- -----
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
VALUE PORTFOLIO AND THE S&P 500 INDEX
AVG. ANNUAL RETURN 06/30/95
1 YEAR ....11.30% VALUE $12,940.37
5 YEAR ..5.63% S&P 500 $18,834.61
INCEPTION 4.77%
GRAPH
- -----
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
GOVERNMENT/QUALITY BOND PORTFOLIO AND THE
MERRILL LYNCH U.S. TREASURY INTER-TERM BOND INDEX
AVG. ANNUAL RETURN 06/30/95
- ------------------ --------
1 YEAR ..9.42% GOVERNMENT/QUALITY $16,968.78
5 YEAR 7.89% MERRILL LYNCH U.S. TREASURY
INCEPTION 7.82% INTER-TERM BOND $17,862.49
Past performance is not predictive of future performance. Value Portfolio for
the period December 20, 1989 (inception) through June 30, 1995.
Government/Quality Bond Portfolio for the period June 23, 1988 (inception)
through June 30, 1995.
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
SMITH HAYES Trust, Inc.
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of SMITH HAYES Trust, Inc. (comprised respectively
of the Asset Allocation, Balanced, Convertible, Small Cap, Value, and
Government/Quality Bond Portfolios) as of June 30, 1995, and the related
statements of operations and changes in net assets, and the financial highlights
for the year then ended. These financial statements and financial highlights are
the responsibility of the Trust's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on our
audit. The statement of changes in net assets for the year ended June 30, 1994
and the financial highlights for the period July 1, 1990, (except for the Small
Cap Portfolio, which commenced operations July 1, 1992) to June 30, 1994 were
audited by other auditors whose report dated July 22, 1994, expressed an
unqualified opinion on such statements and such financial highlights.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of June 30, 1995 by
correspondence with the custodian and brokers. An audit also includes assessing
the accounting principles used and significant estimates made by management as
well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of each of the
aforementioned portfolios constituting SMITH HAYES Trust, Inc. as of June 30,
1995, the results of its operations, the changes in its net assets, and the
financial highlights for the year then ended, in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
Lincoln, Nebraska
July 21, 1995
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS
JUNE 30, 1995
ASSET ALLOCATION PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK 50.08% ASSETS VALUE
------- ----------------------------- ---------- ----------
AUTO/TRUCK/PARTS 3.81%
---------------- -----
1,350 Dana Corporation $ 38,644
850 Varity Corporation* 37,400
------
76,044
------
BROADCASTING/MEDIA 1.90%
------------------ -----
350 Capital Cities/ABC, Inc. 37,800
------
CHEMICAL/DRUG 5.72%
------------- -----
350 Dow Chemical Company 25,156
575 PPG Industries, Inc. 24,725
1,500 Praxair, Inc. 37,500
800 Union Carbide Corporation 26,700
--------
114,081
--------
COMMERCIAL SERVICES 0.93%
------------------- -----
725 Manpower, Inc. 18,488
------
COMPUTER RELATED 1.60%
---------------- -----
600 Cabletron Systems, Inc.* 31,950
------
ELECTRICAL EQUIPMENT 1.78%
-------------------- -----
925 General Instrument Corporation* 35,497
------
ELECTRONICS 3.10%
----------- -----
700 Micron Technology, Inc. 38,412
175 Texas Instrument, Inc. 23,428
------
61,840
------
FINANCIAL SERVICES 3.43%
------------------ -----
725 Dean Witter Discover and Company 34,075
775 Green Tree Financial Corporation 34,391
------
$ 68,466
------
* Indicates nonincome-producing security.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
ASSET ALLOCATION PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
FOOD PROCESSING 3.19%
--------------- -----
500 Campbell Soup Company $24,500
900 IBP, Inc. 39,150
------
63,650
------
GROCERY STORES 2.67%
-------------- -----
750 Albertson's, Inc. 22,313
825 Safeway, Inc. * 30,834
------
53,147
------
INSURANCE 2.16%
--------- -----
600 AFLAC, Inc. 26,250
550 U.S. Healthcare, Inc. 16,844
------
43,094
------
MACHINERY/EQUIPMENT 2.01%
------------------- -----
625 Caterpillar, Inc. 40,156
------
MANUFACTURING 4.01%
------------- -----
800 Black & Decker Corporation 24,700
525 Illinois Tool Work, Inc. 28,875
600 Leggett & Platt, Inc. 26,400
------
79,975
------
MEDICAL SUPPLIES/SERVICES 2.55%
------------------------- -----
550 Columbia/HCA Healthcare Corporation 23,788
350 Medtronic, Inc. 26,994
------
$50,782
------
* Indicates nonincome-producing security.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
ASSET ALLOCATION PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
OIL/GAS 5.40%
------- -----
450 Exxon Corporation $ 31,781
700 Halliburton Company 25,025
250 Mobil Corporation 24,000
1,100 Panhandle Eastern Corporation 26,812
--------
107,618
--------
PHARMACEUTICAL 1.36%
-------------- -----
400 Johnson & Johnson 27,050
------
RETAIL STORE/APPAREL 2.82%
-------------------- -----
975 Circuit City Stores, Inc. 30,834
300 Nike, Inc. Class B 25,200
------
56,034
------
TELECOMMUNICATION 1.64%
----------------- -----
975 Equifax, Inc. 32,541
------
PRINCIPAL
AMOUNT UNITED STATES GOVERNMENT SECURITIES44.70%
835,000 United States Treasury Note, 7.25% due 5/15/04 890,971
-------
Total Investments 94.78% 1,889,184
Cash Equivalents 5.08% 101,251
Net Receivables/(Payables) 0.14% 2,863
-------- ----------
TOTAL NET ASSETS 100.00% $1,993,298
======= ==========
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS
JUNE 30, 1995
BALANCED PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK 66.97% ASSETS VALUE
------- ----------------------------- ---------- ----------
AEROSPACE/DEFENSE 2.35%
----------------- -----
1,470 General Motors Class H $ 58,065
------
COMMERCIAL SERVICES 1.98%
------------------- -----
1,900 Kelly Services, Inc. Class A 48,925
------
COMPUTER RELATED 2.55%
---------------- -----
1,000 Automatic Data Processing, Inc. 62,875
------
ELECTRONICS/ELECTRICAL EQUIPMENT 8.29%
-------------------------------- -----
1,500 Honeywell, Inc. 64,688
1,200 Motorola, Inc. 80,550
3,200 X-Rite, Inc. 59,200
--------
204,438
--------
FINANCIAL SERVICES 2.61%
------------------ -----
2,000 Comerica Inc. 64,250
------
FOOD PROCESSING 1.87%
--------------- -----
1,400 Quaker Oats Company 46,025
------
FOREST PRODUCTS/PAPER 2.43%
--------------------- -----
1,000 Kimberly Clark Corporation 59,875
------
INSURANCE 2.43%
--------- -----
900 MBIA, Inc. 59,850
------
MACHINERY/EQUIPMENT 2.37%
------------------- -----
1,300 York International Corporation $ 58,500
------
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
BALANCED PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
MANUFACTURING 2.47%
------------- -----
1,400 Pentair, Inc. $ 60,900
------
MEDICAL SUPPLIES/SERVICES 3.20%
------------------------- -----
1,900 Invacare Corporation 78,850
------
METALS/MINING 4.26%
------------- -----
2,600 Homestake Mining Company 42,900
2,700 Trimas Corporation 62,100
--------
105,000
--------
OIL/GAS 4.73%
------- -----
2,100 Apache Corporation 57,488
900 Texaco, Inc. 59,062
--------
116,550
--------
PHARMACEUTICAL 3.02%
-------------- -----
1,100 Johnson & Johnson 74,387
------
TELECOMMUNICATION EQUIPMENT 2.63%
--------------------------- -----
3,000 Federal Signal Corporation 64,875
------
UTILITIES - ELECTRIC 17.22%
-------------------- ------
3,100 American Electric Power Company 108,888
3,580 Detroit Edison Company 105,610
4,000 Peco Energy Company 110,500
3,600 Public Service Enterprise Group, Inc. 99,900
--------
424,898
--------
UTILITIES - TELECOMMUNICATION 2.56%
----------------------------- -----
1,000 BellSouth Corporation $ 63,500
------
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
BALANCED PORTFOLIO
PERCENT
OF NET MARKET
PRINCIPAL ASSETS VALUE
AMOUNT UNITED STATES GOVERNMENT SECURITIES 20.77%
------- ----------------------------- ---------- ----------
525,000 United States Treasury Note, 5.875% due
2/15/04 $512,203
-------
Total Investments 87.74% 2,163,966
Cash Equivalents 11.75% 289,617
Net Receivables/(Payables) 0.51% 12,661
------- ----------
TOTAL NET ASSETS 100.00% $2,466,244
======= ==========
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS
JUNE 30, 1995
CONVERTIBLE PORTFOLIO
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT ASSETS VALUE
------- ---------- ----------
CONVERTIBLE DEBENTURES 55.92%
---------------------------------------
15,000 Albany International Corporation 5.25%,
due 3/15/02 $14,588
10,000 American Brands 7.625%, due 3/5/01 10,475
25,000 AMR Corporation 6.125%, due 11/1/24 26,063
30,000 Amoco Corporation 7.375%, due 9/1/13 38,438
15,000 Apache Corporation 6.00%,due 1/15/02 16,800
19,000 Arrow Electronics 5.75%, due 10/15/02 28,832
110,000 Automatic Data Processing,Inc.0%,due 2/20/12 49,225
16,000 Big B Inc. 6.50%, due 3/15/03 19,120
20,000 Carnival Cruise Lines,Inc.4.50%,due 7/1/97 27,825
24,000 Cooper Industries 7.05%, due 1/1/15 24,990
20,000 DAKA International 7.00%, due 3/15/03 38,900
40,000 Delta Air Lines, Inc. 3.23%, due 6/15/03 38,400
45,000 Elan International 0%, due 10/16/12 20,925
15,000 First Financial Management Corp. 5.00%,
due 12/15/99 20,325
12,000 Gencorp, Inc. 8.00%, due 8/1/02 11,550
35,000 Hasbro, Inc. 6.00%, due 11/15/98 39,375
35,000 IMC Global, Inc. 6.25%, due 12/01/01 35,700
35,000 International Paper 5.75%, due 9/23/02 43,794
30,000 Interpublic Group 3.75%, due 4/1/02 26,700
60,000 Motorola, Inc. 0%, due 9/27/13 49,200
50,000 News Corporation 0%, due 3/11/13 23,875
30,000 Olsten Corporation 4.875%, due 5/15/03 31,800
30,000 Pennzoil Company 6.50%, due 1/15/03 35,550
15,000 Raymond Corporation 6.50%, due 12/15/03 18,412
20,000 Riverwood International 6.75%, due 9/15/03 26,900
50,000 RPM, Inc. 0%, due 9/30/12 20,937
55,000 Thermo Electron Corporation 5.00%,
due 4/15/01 72,875
90,000 Time Warner Inc. 0%, due 6/22/13 36,112
40,000 Time Warner Inc. 8.75%, due 1/10/15 41,850
15,000 Titan Wheel International 4.75%, due 12/1/00 20,606
15,000 Unifi, Inc. 6.00%, due 3/15/02 $15,075
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
CONVERTIBLE PORTFOLIO
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT CONVERTIBLE DEBENTURES (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
30,000 USA Waste Services, Inc. 8.50%, due 10/15/02 $ 35,250
25,000 Varlen Corporation 6.50%, due 6/1/03 26,500
--------
986,967
--------
SHARES PREFERRED STOCK 30.43%
AUTO/TRUCKS 7.88%
----------- -----
850 Ford Motor Company, $4.20 Prfd Series A 82,556
900 General Motors, $3.25 Prfd Series C 56,700
--------
139,256
--------
ELECTRONICS 0.01%
----------- -----
3 Comprtonix Corporation, 6% Prfd Series A 10
--
FINANCIAL SERVICES 11.52%
------------------ ------
450 Banc One Corporation, $3.50 Prfd Series C 26,212
350 Citicorp, $1.217 Prfd Series 15 55,694
550 First Chicago $5.75 Prfd Series B 31,900
500 Republic New York Corporation $3.375 Prfd 28,875
500 Soloman, Inc. (Digital), 6.75% Prfd 20,000
650 Travelers, Inc. $2.75 Prfd Series B 40,788
-------
203,469
-------
FOOD/BEVERAGE/TABACCO 4.45%
1,600 ConAgra, Inc. $1.6875 Prfd Series E 56,600
3,600 RJR Nabisco Holdings Corporation,
9% Prfd Series C 22,050
------
78,650
------
METALS/MINING 5.00%
400 Cyprus Amax Mineral Company, $4 Prfd Series A 24,300
650 Magma Copper Company, 5.625% Prfd Series D 38,594
550 Wheeling Pittsburgh Corporation, $3.25
Prfd Series A 25,300
------
88,194
------
PACKAGING/CONTAINER 1.57%
------------------- -----
500 Sonoco Products, $2.25 Prfd Series A $ 27,750
------
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
CONVERTIBLE PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK 13.00% ASSETS VALUE
------ ------------ ------ -------- -----
CHEMICAL/DRUG 0.96%
------------- -----
250 Bristol Meyers Squibb Company $ 17,031
------
COMPUTER RELATED 1.51%
---------------- ------
275 International Business Machines, Inc. 26,400
------
FINANCIAL SERVICES 4.41%
------------------ -----
548 BankAmerica Corporation 28,838
511 Bank of New York Company 20,632
300 Federal National Mortgage Association 28,313
------
77,783
------
PETROLEUM RELATED 2.07%
----------------- -----
2,500 Tuboscope Vetco International Corporation* 15,938
2,500 Varco International, Inc.* 20,625
------
36,563
------
PACKAGING/CONTAINER 1.40%
------------------- -----
1,000 Sonoco Products Corporation 24,750
------
RESTAURANT/FOOD SERVICE 1.62%
----------------------- -----
2,200 Consolidated Products, Inc.* 28,600
------
TELECOMMUNICATIONS 1.03%
------------------ -----
1,000 Alcatel Alsthom ADS 18,125
------
Total Investments 99.35% 1,753,548
Cash Equivalents 0.17% 2,946
Net Receivables/(Payables) 0.48% 8,473
------- ----------
TOTAL NET ASSETS 100.00% $1,764,967
======= ==========
* Indicates nonincome-producing security.
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS
JUNE 30,1995
SMALL CAP PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK 95.65% ASSETS VALUE
------- ----------------------------- ---------- ----------
CHEMICALS 7.80%
--------- -----
8,200 Chemed Corporation $ 284,950
9,000 Lesco, Inc. 140,625
3,600 OM Group, Inc. 102,600
11,700 Synalloy Corporation 219,375
-------
747,550
-------
COMPUTER RELATED 7.01%
---------------- -----
17,700 Exabyte Corporation * 245,588
8,000 OPTI, Inc. * 182,000
4,900 Zilog, Inc. * 244,387
-------
671,975
-------
ELECTRICAL EQUIPMENT 8.81%
-------------------- -----
7,600 Baldor Electric Company 217,550
11,000 Gasonics International Corporation* 313,500
4,500 Kent Electronics Corporation 170,437
10,800 Sheldahl, Inc.* 143,100
-------
844,587
-------
ELECTRONICS 17.46%
----------- ------
9,700 Benchmark Electronics, Inc. * 238,863
12,200 BMC Industries, Inc. 306,525
9,900 Dovatron International, Inc. * 242,550
4,200 Input/Output, Inc. * 151,200
6,200 Logicon, Inc. 275,900
12,000 LTX Corporation* 106,500
14,400 Verifone, Inc. * 352,800
----------
1,674,338
----------
ENTERTAINMENT 2.00%
------------- -----
9,600 Players International, Inc.* $ 192,000
-------
* Indicates nonincome-producing security.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
SMALL CAP PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
FINANCIAL SERVICES 7.09%
------------------ -----
3,600 Cullen/Frost Bankers, Inc. $145,800
11,200 Roosevelt Financial Group, Inc. 186,900
7,300 TCF Financial Corporation 346,750
-------
679,450
-------
INSURANCE 1.28%
--------- -----
5,000 Sierra Health Services, Inc.* 122,500
-------
MACHINE/MACHINE TOOL 3.40%
-------------------- -----
8,700 AGCO Corporation 326,250
-------
MANUFACTURING 3.09%
------------- -----
16,600 Paxar Corporation* 296,725
-------
MEDICAL SUPPLIES/SERVICES 3.30%
------------------------- -----
14,400 Coventry Corporation* 203,400
4,000 Lunar Corporation* 113,000
-------
316,400
-------
OIL/GAS 8.55%
------- -----
13,400 Cairn Energy USA, Inc.* 147,400
6,500 Landmark Graphics Corporation* 165,750
9,100 Nuevo Energy Company* 183,138
7,600 Parker & Parsley Petroleum Company 149,150
18,100 Tejas Power Corporation Class A * 174,212
-------
819,650
-------
PUBLISHING/PRINTING 0.90%
------------------- -----
6,300 Consolidated Graphics, Inc.* $ 86,625
------
* Indicates nonincome-producing security.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
SMALL CAP PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
REAL ESTATE 4.04%
----------- -----
8,500 Felcor Suite Hotels, Inc. $ 216,750
11,200 RFS Hotel Investors, Inc. 170,800
-------
387,550
-------
RETAIL/RETAIL STORE 5.33%
------------------- -----
9,000 Big B, Inc. 127,125
9,000 Friedman's Inc. Class A* 171,000
28,400 Sun Television and Appliances 213,000
-------
511,125
-------
STEEL 3.36%
----- -----
13,000 Quanex Corporation 321,750
-------
TELECOMMUNICATIONS 1.66%
------------------ -----
9,100 Intervoice Inc.* 159,250
-------
TRANSPORTATION 5.10%
-------------- -----
14,600 Covenant Transport, Inc. * 189,800
9,900 Kirby Corporation * 157,163
7,500 M.S. Carriers, Inc. * 142,500
-------
489,463
-------
TRUCKING & LEASING 3.14%
------------------ -----
18,000 Swift Transportation Co. Inc.* 301,500
-------
WHOLESALE SPECIAL LINE 2.33%
---------------------- -----
12,900 Sodak Gaming, Inc. * 224,137
-------
Total Investments 95.65% 9,172,825
Cash Equivalents 8.75% 839,390
Net Receivables/(Payables) (4.40)% (422,427)
------- ----------
TOTAL NET ASSETS 100.00% $9,589,788
======= ==========
* Indicates nonincome-producing security.
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS
JUNE 30, 1995
VALUE PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK 93.19% ASSETS VALUE
------ ------------- ------ ------ -----
AEROSPACE/DEFENSE 3.77%
----------------- -----
300 Boeing Company $ 18,788
400 Loral Corporation 20,700
500 Rockwell International Corporation 22,875
------
62,363
------
BUILDING MATERIALS/CONSTRUCTION 1.51%
------------------------------- -----
700 Sherwin-Williams Company 24,937
------
CHEMICALS 1.63%
--------- -----
400 FMC Corporation * 26,900
------
COMMERCIAL SERVICES 4.01%
------------------- -----
1,500 Dial Corporation 37,125
600 FlightSafety International, Inc. 29,250
------
66,375
------
ELECTRICAL EQUIPMENT 6.46%
-------------------- -----
1,300 Corning, Inc. 42,575
900 Emerson Electric Company 64,350
--------
106,925
--------
ELECTRONICS 5.62%
----------- -----
1,000 Sundstrand Corporation 59,750
600 Varian Associates, Inc. 33,150
------
92,900
------
ENGINEERING/CONSTRUCTION 1.26%
------------------------ -----
400 Fluor Corp. $ 20,800
------
* Indicates nonincome-producing security.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
VALUE PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
FINANCIAL SERVICES 11.01%
------------------ ------
1,000 Bank of New York Company, Inc. $ 40,375
500 Chase Manhatten Corporation 23,500
1,000 Corestates Financial Corporation 34,875
500 Franklin Resources, Inc. 22,250
400 Merrill Lynch & Company, Inc. 21,000
1,000 Salomon, Inc. 40,125
--------
182,125
--------
FOOD/BEVERAGES 1.93%
-------------- -----
700 Pepsico, Inc. 31,937
------
FOREST PRODUCTS/PAPER 3.20%
--------------------- -----
600 Mead Corporation 35,625
300 Union Camp Corporation 17,362
------
52,987
------
INSURANCE 6.06%
--------- -----
200 American International Group, Inc. 22,800
1,300 Physician Corporation of America* 17,713
600 Progressive Corporation Ohio 23,025
1,200 U.S. Healthcare, Inc. 36,750
--------
100,288
--------
MACHINERY/TOOLS 5.91%
--------------- -----
500 Agco Corporation 18,750
1,000 Cincinnati Milacron, Inc. 27,000
1,500 Harnischfeger Industries, Inc. 51,938
------
$ 97,688
------
* Indicates nonincome-producing security.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
VALUE PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
MANUFACTURING 3.52%
------------- -----
600 AlliedSignal, Inc. $ 26,700
900 Trinova Corporation 31,500
------
58,200
------
MEDICAL SUPPLIES/SERVICES 1.05%
------------------------- -----
400 Columbia/HCA Healthcare Corporation 17,300
------
METALS/MINING 1.39%
------------- -----
500 Timken Company 23,062
------
OIL/GAS 11.39%
------- ------
400 Anadarko Petroleum Corporation 17,250
300 Atlantic Richfield Company 32,925
900 Enron Corporation 31,613
400 Exxon Corporation 28,250
400 Mobil Corporation 38,400
900 Western Atlas, Inc.* 39,937
--------
188,375
--------
PHARMACEUTICAL/MEDICAL 5.27%
---------------------- -----
1,800 Caremark International, Inc. 36,000
4,500 Carter-Wallace, Inc. 51,188
------
87,188
------
RESTAURANT/FOOD SERVICE 1.08%
----------------------- -----
1,000 Wendy's International, Inc. 17,875
------
RETAIL/APPAREL 2.50%
-------------- -----
1,000 Nordstrom, Inc. $ 41,375
------
* Indicates nonincome-producing security.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
VALUE PORTFOLIO
PERCENT
OF NET MARKET
SHARES COMMON STOCK (CONTINUED) ASSETS VALUE
------- ----------------------------- ---------- ----------
RETAIL STORE 6.03%
------------ -----
700 Circuit City Stores, Inc. $ 22,138
2,200 Price/Costco, Inc.* 35,750
700 Sears, Roebuck and Company 41,912
------
99,800
------
TRANSPORTATION 5.91%
-------------- -----
1,200 Conrail, Inc. 66,750
1,300 Southwest Airlines Company 31,038
------
97,788
------
UTILITIES 2.68%
--------- -----
400 American Electric Power Company 14,050
1,100 Peco Energy Company 30,387
------
44,437
------
Total Investments 93.19% 1,541,625
Cash Equivalents 6.92% 114,488
Net Receivables/(Payables) (0.11)% (1,793)
------ ----------
TOTAL NET ASSETS 100.00% $1,654,320
======= ==========
* Indicates nonincome-producing security.
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
SCHEDULE OF INVESTMENTS
JUNE 30, 1995
GOVERNMENT/QUALITY BOND PORTFOLIO
PRINCIPAL PERCENT OF MARKET
AMOUNT NET ASSETS VALUE
------- ---------- ----------
U.S. GOVERNMENT SECURITIES 71.62%
-----------------------------------
500,000 Federal Natl. Mtg. Asso. 0%, due 7/17/95 $ 498,604
115,089 Govt. Natl. Mtg. Asso. 11.50%, due 10/15/10 129,512
306,012 Govt. Natl. Mtg. Asso. 10.00%, due 12/15/18 332,980
4,750 Govt. Natl. Mtg. Asso. 10.00%, due 5/15/19 5,169
43,437 Govt. Natl. Mtg. Asso. 9.50%, due 9/15/19 46,003
46,890 Govt. Natl. Mtg. Asso. 10.00%, due 5/15/20 51,023
149,425 Govt. Natl. Mtg. Asso. 9.50%, due 9/15/21 158,251
147,390 Govt. Natl. Mtg. Asso. 7.50%, due 4/15/22 148,081
96,912 Govt. Natl. Mtg. Asso. 7.50%, due 5/15/23 97,367
217,493 Govt. Natl. Mtg. Asso. 7.50%, due 1/15/24 218,513
200,000 Student Loan Mrkt. Asso. Float Rate,
due 4/16/96 200,070
250,000 U. S. Treasury Note 8.50%, due 11/15/95 252,383
100,000 U. S. Treasury Note 5.50%, due 4/30/96 99,765
175,000 U. S. Treasury Note 6.375%, due 8/15/02 177,023
250,000 U. S. Treasury Note 5.75%, due 8/15/03 242,422
100,000 U. S. Treasury Bond 10.75%, due 8/15/05 132,594
300,000 U. S. Treasury Bond 7.125%, due 2/15/23 316,219
1,000,000 U. S. Treasury Strip 0%, due 5/15/15 255,877
----------
3,361,856
CORPORATE BONDS 23.02%
150,000 Associates Corp. North America 8.375%,
due 6/1/96 145,481
225,000 Chase Manhattan Credit Card 8.75%,
due 8/15/99 230,098
200,000 ITT Financial Corp. 8.375%, due 8/1/95 200,293
250,000 Sears Credit Corporation 7.75%, due 9/15/98 254,688
250,000 Standard Credit Card Trust 5.875%,
due 8/07/96 250,000
1,080,560
Total Investments 94.64% 4,442,416
Cash Equivalents 4.05% 190,249
Net Receivables/(Payables) 1.31% 61,259
------- ----------
TOTAL NET ASSETS 100.00% $4,693,924
======= ==========
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1995
ASSET
ALLOCATION BALANCED CONVERTIBLE
PORTFOLIO PORTFOLIO PORTFOLIO
---------- ---------- ------------
ASSETS:
Investments in securities, at market
value (note 4) $1,889,184 2,163,966 1,753,548
Cash equivalents 101,251 289,617 2,946
Accrued interest and dividends receivable 8,950 20,330 13,710
----- ------ ------
Total assets 1,999,385 2,473,913 1,770,204
--------- --------- ---------
LIABILITY:
Accrued expenses, including investment
management and service fees and
distribution expense reimbursement
payable to adviser, administrator and
distributor (note 3) 6,087 7,669 5,237
----- ----- -----
Net assets applicable to outstanding
capital stock $1,993,298 2,466,244 1,764,967
========== ========= =========
NET ASSETS ARE REPRESENTED BY:
Capital stock outstanding, at par (note 6) 192 226 147
Additional paid-in capital 1,677,240 2,096,677 1,607,031
Accumulated undistributed net
investment income 43 16 86
Accumulated undistributed net realized
gain (loss) 76,319 78,924 (21,355)
Unrealized appreciation (note 5) 239,504 290,401 179,058
------- ------- -------
Total amount representing net assets
applicable to shares outstanding $1,993,298 2,466,244 1,764,967
========== ========= =========
Net asset value per share of outstanding
capital stock $10.37 10.90 11.97
====== ===== =====
See accompanying notes to financial
statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1995
QUALITY
SMALL CAP VALUE BOND
PORTFOLIO PORTFOLIO PORTFOLIO
ASSETS:
Investments in securities, at market
value (note 4) $9,172,825 1,541,625 4,442,416
Cash equivalents 839,390 114,488 190,249
Accrued interest and dividends receivable 8,126 3,008 69,384
----- ------- ------
Receivable for investment securities sold 113,259 - -
------- ------ --------
Total assets 10,133,600 1,659,121 4,702,049
---------- --------- ---------
LIABILITIES:
Accrued expenses, including investment
management and service fees and
distribution expense reimbursement payable
to adviser, administrator and
distributor (note 3) 14,347 4,801 8,125
Payable for investment securities
purchased 529,465 - -
Total liabilities 543,812 4,801 8,125
------- ----- -----
Net assets applicable to outstanding $9,589,788 1,654,320 4,693,924
========== ========= =========
capital stock
NET ASSETS ARE REPRESENTED BY:
Capital stock outstanding, at par (note 6) 711 147 450
Additional paid-in capital 8,390,526 1,178,641 4,879,374
Accumulated undistributed net investment
income (loss) (95,165) (51,757) 3,965
Accumulated undistributed net realized
gain (loss) (32,255) 384,968 (186,084)
Unrealized appreciation (depreciation)
(note 5) 1,325,971 142,321 (3,781)
--------- ------- -------
Total amount representing net assets
applicable to shares outstanding $9,589,788 1,654,320 4,693,924
========== ========= =========
Net asset value per share of outstanding $13.49 11.22 10.43
====== ===== =====
capital stock
See accompanying notes to financial
statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1995
ASSET
ALLOCATION BALANCED CONVERTIBLE
PORTFOLIO PORTFOLIO PORTFOLIO
----------- ---------- -----------
INVESTMENT INCOME:
Dividends $36,745 57,123 37,510
Interest 132,453 176,502 68,660
------- ------- ------
Total investment income 169,198 233,625 106,170
------- ------- -------
EXPENSES (NOTE 3):
Investment advisory and administration fees 43,111 57,127 26,152
Distribution expenses 18,102 23,996 10,996
Custodial fees 4,556 3,000 3,135
Auditing and tax accounting fees 4,089 3,774 2,422
Security pricing 3,140 1,790 1,851
Other operating expenses 3,396 4,266 4,852
----- ----- -----
Total expenses 76,394 93,953 49,408
------ ------ ------
Net investment income 92,804 139,672 56,762
------ ------- ------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS (NOTE 5):
Net realized gain (loss) 226,971 277,943 (11,847)
------- ------- --------
Net unrealized appreciation (depreciation)
Beginning of period 117,050 252,523 (23,601)
End of period 239,504 290,401 179,058
------- ------- -------
Net unrealized appreciation 122,454 37,878 202,659
------- ------ -------
Net realized and unrealized gain on
investments 349,425 315,821 190,812
------- ------- -------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $442,229 455,493 247,574
======== ======= =======
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1995
QUALITY
SMALL CAP VALUE BOND
PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- -----------
INVESTMENT INCOME:
Dividends $78,177 48,849 -
Interest 33,755 5,293 498,274
------ ----- -------
Total investment income 111,932 54,142 498,274
------- ------ -------
EXPENSES (NOTE 3):
Investment advisory and administration fees 100,120 42,310 53,741
Distribution expenses 42,219 17,753 27,252
Custodial fees 6,308 4,268 5,381
Auditing and tax accounting fees 2,804 2,886 3,973
Security pricing 3,089 4,206 2,227
Other operating expenses 8,299 3,373 7,134
----- ----- -----
Total expenses 162,839 74,796 99,708
------- ------ ------
Net investment income (loss) (50,907) (20,654) 398,566
-------- -------- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS (NOTE 5):
Net realized gain (loss) (37,137) 493,830 (232,150)
-------- ------- ---------
Net unrealized appreciation (depreciation)
Beginning of period (297,619) 415,335 (356,235)
End of period 1,325,971 142,321 (3,781)
--------- ------- -------
Net unrealized appreciation
(depreciation) 1,623,590 (273,014) 352,454
--------- --------- -------
Net realized and unrealized gain
on investments 1,586,453 220,816 120,304
--------- ------- -------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $1,535,546 200,162 518,870
========== ======= =======
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED JUNE 30, 1995 AND 1994
ASSET ALLOCATION BALANCED
PORTFOLIO PORTFOLIO
1995 1994 1995 1994
--------- -------- -------- -----------
OPERATIONS:
Net investment income $92,804 39,031 139,672 116,998
Net realized gain
on investments 226,971 1,051,128 277,943 502,539
Unrealized appreciation
(depreciation) 122,454 (1,108,816) 37,878 (760,972)
------- ----------- ------ ---------
Net increase (decrease)
in net assets
resulting from operations 442,229 (18,657) 455,493 (141,435)
------- -------- ------- ---------
DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net investment income 93,316 36,674 140,859 118,108
Net realized gains 735,471 555,014 490,579 313,476
------- ------- ------- -------
Total distributions 828,787 591,688 631,438 431,584
------- ------- ------- -------
CAPITAL SHARE TRANSACTIONS:
(NOTE 6)
Proceeds from sales 89,077 365,135 295,171 1,154,960
Payment for redemptions (3,881,092)(1,437,098) (4,899,867)(1,377,276)
Reinvestment of net investment
income and net realized
gain distributions
at net asset value 828,787 591,397 623,511 427,119
------- ------- ------- -------
Total increase
(decrease) from capital
share transactions (2,963,228)(480,566) (3,981,185) 204,803
---------- --------- ----------- --------
Total decrease in
net assets (3,349,786)(1,090,911) (4,157,130)(368,216)
NET ASSETS:
Beginning of period 5,343,084 6,433,995 6,623,374 6,991,590
--------- --------- --------- ---------
End of period $1,993,298 5,343,084 2,466,244 6,623,374
========== ========= ========= =========
See accompanying notes to
financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED JUNE 30, 1995 AND 1994
CONVERTIBLE SMALL CAP
PORTFOLIO PORTFOLIO
1995 1994 1995 1994
---------- ---------- --------- ----------
OPERATIONS:
Net investment income (loss) $56,762 62,873 (50,907) (30,671)
Net realized gain (loss)
on investments (11,847) 259,369 (37,137) 376,828
Unrealized appreciation
(depreciation) 202,659 (412,999) 1,623,590 (518,423)
------- --------- --------- ---------
Net increase (decrease)
in net assets
resulting from operations 247,574 (90,757) 1,535,546 (172,266)
------- -------- --------- ---------
DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net investment income 58,599 62,336
- -
Net realized gains 165,477 77,731 276,654 129,226
------- ------ ------- -------
Total distributions 224,076 140,067 276,654 129,226
------- ------- ------- -------
CAPITAL SHARE TRANSACTIONS:
(NOTE 6)
Proceeds from sales 169,674 830,694 3,211,418 4,916,459
Payment for redemptions (1,359,579)(399,942) (2,372,561)(663,011)
Reinvestment of netinvestment
income and net realized
gain distributions
at net asset value 223,270 139,300 273,095 129,226
------- ------- ------- -------
Total increase
(decrease) from capital
share transactions (966,635) 570,052 1,111,952 4,382,674
--------- ------- --------- ---------
Total increase
(decrease) in net assets (943,137) 339,228 2,370,844 4,081,182
NET ASSETS:
Beginning of period 2,708,104 2,368,876 7,218,944 3,137,762
--------- --------- --------- ---------
End of period $1,764,967 2,708,104 9,589,788 7,218,944
========== ========= ========= =========
See accompanying notes to
financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED JUNE 30, 1995 AND 1994
VALUE GOVERNMENT/QUALITY
PORTFOLIO BOND PORTFOLIO
1995 1994 1995 1994
---- ---- ---- ----
OPERATIONS:
Net investment income (loss) ($20,654) (28,848) 398,566 466,128
Net realized gain (loss)
on investments 493,830 343,008 (232,150) 74,839
Unrealized appreciation
(depreciation) (273,014) (591,469) 352,454 (712,515)
--------- --------- ------- ---------
Net increase (decrease)
in net assets
resulting from operations 200,162 (277,309) 518,870 (171,548)
------- --------- ------- ---------
DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net investment income - - 406,678 466,252
Net realized gains 409,507 - 292 166,196
------- ----------- --- -------
Total distributions 409,507 - 406,970 632,448
------- ----------- ------- -------
CAPITAL SHARE TRANSACTIONS:
(NOTE 6)
Proceeds from sales 323,001 793,554 767,050 1,665,565
Payment for redemptions (4,155,154)(1,398,732) (5,398,157)(2,344,444)
Reinvestment of net
investment income and net
realized gain distributions
at net asset value 409,507 - 380,984 605,636
------- ----------- ------- -------
Total decrease from capital
share transactions (3,422,646)(605,178) (4,250,123) (73,243)
--------- --------- ---------- --------
Total decrease in
net assets (3,631,991)(882,487) (4,138,223)(877,239)
NET ASSETS:
Beginning of period 5,286,311 6,168,798 8,832,147 9,709,386
--------- --------- --------- ---------
End of period $1,654,320 5,286,311 4,693,924 8,832,147
========== ========= ========= =========
See accompanying notes to
financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
YEARS ENDED JUNE 30, 1995, 1994, 1993, 1992 AND 1991
ASSET ALLOCATION PORTFOLIO
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
NET ASSET VALUE:
Beginning of period $11.08 12.33 11.61 10.96 10.09
------ ----- ----- ----- -----
Income (loss) from investment
operations:
Net investment income 0.27 0.07 0.11 0.12 0.24
Net realized and
unrealized gain
(loss) on investments 1.02 (0.15) 1.00 0.78 1.14
---- ------ ---- ---- ----
Total income (loss) from
investment 1.29 (0.08) 1.11 0.90 1.38
---- ------ ---- ---- ----
operations
Less distributions:
Dividends from net
investment income (0.27) (0.07) (0.11) (0.12) (0.34)
Distributions from
capital gains (1.73) (1.10) (0.28) (0.13) (0.17)
------ ------ ------ ------ ------
Total distributions (2.00) (1.17) (0.39) (0.25) (0.51)
------ ------ ------ ------ ------
End of period $10.37 11.08 12.33 11.61 10.96
====== ===== ===== ===== =====
TOTAL RETURN 19.10% (.66%) 9.51% 8.19% 12.95%
====== ====== ===== ===== ======
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period $1,993,298 5,343,084 6,433,995 6,937,275 6,470,722
Ratio of expenses to
average net assets 2.12% 1.96% 1.93% 2.15% 2.39%
Ratio of net income to
average net assets 2.57% 0.64% 0.91% 1.04% 2.05%
Portfolio turnover rate 46.38% 117.77% 40.53% 19.42% 48.30%
See accompanying notes to
financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
YEARS ENDED JUNE 30, 1995, 1994, 1993, 1992 AND 1991
BALANCED PORTFOLIO
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
NET ASSET VALUE:
Beginning of period $11.26 12.23 11.10 10.72 10.77
------ ----- ----- ----- -----
Income (loss) from investment operations:
Net investment income 0.33 0.20 0.34 0.36 0.37
Net realized and unrealized gain
(loss) on investments 0.74 (0.43) 1.13 0.38 0.02
---- ------ ---- ---- ----
Total income (loss) from
investment 1.07 (0.23) 1.47 0.74 0.39
---- ------ ---- ---- ----
operations
Less distributions:
Dividends from net
investment income (0.33) (0.20) (0.34) (0.36) (0.34)
Distributions from
capital gains (1.10) (0.54) - - (0.10)
------ ------ ------- -------- ------
Total distributions (1.43) (0.74) (0.34) (0.36) (0.44)
------ ------ ------ ------ ------
End of period $10.90 11.26 12.23 11.10 10.72
====== ===== ===== ===== =====
TOTAL RETURN 11.18% (1.99%) 13.16% 6.81% 4.84%
====== ======= ====== ===== =====
RATIOS/SUPPLEMENTAL DATA:
Net assets,end of period $2,466,244 6,623,374 6,991,590 7,386,180 6,122,831
Ratio of expenses to
average net assets 1.96% 1.91% 1.89% 2.13% 2.31%
Ratio of net income to
average net assets 2.92% 1.65% 2.59% 3.20% 3.95%
Portfolio turnover rate 78.34% 24.17% 24.72% 40.63% 31.70%
See accompanying notes to
financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
YEARS ENDED JUNE 30, 1995, 1994, 1993, 1992 AND 1991
CONVERTIBLE PORTFOLIO
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
NET ASSET VALUE:
Beginning of period $11.69 12.58 10.76 9.96 9.86
------ ----- ----- ---- ----
Income (loss) from investment operations:
Net investment income 0.30 0.29 0.33 0.31 0.40
Net realized and
unrealized gain
(loss) on investments 1.01 (0.53) 2.16 0.80 (0.06)
---- ------ ---- ---- ------
Total income (loss) from
investment operations 1.31 (0.24) 2.49 1.11 0.34
---- ------ ---- ---- ----
Less distributions:
Dividends from net
investment income (0.30) (0.29) (0.33) (0.31) (0.21)
Distributions from
capital gains (0.73) (0.36) (0.34) - (0.03)
------ ------ ------ -------- ------
Total distributions (1.03) (0.65) (0.67) (0.31) (0.24)
------ ------ ------ ------ ------
End of period $11.97 11.69 12.58 10.76 9.96
====== ===== ===== ===== ====
TOTAL RETURN 14.09% (2.26%) 24.06% 10.95% 5.09%
====== ======= ====== ====== =====
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period $1,764,967 2,708,104 2,368,876 1,791,325 1,188,680
Ratio of expenses to
average net assets 2.25% 2.06% 2.13% 2.48% 2.79%
Ratio of net income to
average net assets 2.58% 2.27% 2.91% 2.85% 3.48%
Portfolio turnover rate 51.31% 65.76% 69.72% 96.02% 70.77%
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
YEARS ENDED JUNE 30, 1995, 1994 AND 1993
SMALL CAP PORTFOLIO
1995 1994 1993
---- ---- ----
NET ASSET VALUE:
Beginning of period $11.59 11.77 10.00
------ ----- -----
Income from investment
operations:
Net investment loss (0.08) (0.07) (0.05)
Net realized and unrealized gain
on investments 2.34 0.20 1.83
---- ---- ----
Total income from
investment operations 2.26 0.13 1.78
---- ---- ----
Distributions from capital gains (0.36) (0.31) (0.01)
------ ------ ------
End of period $13.49 11.59 11.77
====== ===== =====
TOTAL RETURN 20.33% 1.21% 17.80%
====== ===== ======
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period $9,589,788 7,218,944 3,137,762
Ratio of expenses to average
net assets 1.93% 1.91% 2.18%
Ratio of net income to average
net assets (0.60%) (0.60%) (0.87%)
Portfolio turnover rate 86.50% 75.23% 47.55%
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
YEARS ENDED JUNE 30, 1995, 1994, 1993, 1992 AND 1991
VALUE PORTFOLIO
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
NET ASSET VALUE:
Beginning of period $11.29 11.92 10.24 9.35 9.75
------ ----- ----- ---- ----
Income (loss) from investment operations:
Net investment income (0.06) (0.06) 0.02 0.00 0.14
Net realized and
unrealized gain
(loss) on investments 0.69 (0.57) 1.68 0.90 (0.25)
---- ------ ---- ---- ------
Total income (loss) from
investment operations 0.63 (0.63) 1.70 0.90 (0.11)
---- ------ ---- ---- ------
Dividends from net
investment income - - (0.02) (0.01) (0.29)
Distributions from
capital gain (0.70) - - - -
----- ----- ----- ----- ----
Total distributions (0.70) - (0.02) (0.01) (0.29)
------ ----------- ------ ------ ------
End of period $11.22 11.29 11.92 10.24 9.35
====== ===== ===== ===== ====
TOTAL RETURN 11.30% (5.29%) 16.60% 9.67% (2.42%)
====== ======= ====== ===== =======
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period $1,654,320 5,286,311 6,168,798 5,138,910 3,983,877
Ratio of expenses to
average net assets 2.11% 1.98% 1.97% 2.35% 2.46%
Ratio of net income to
average net assets (0.58%) (0.48%) 0.18% (0.03%) 1.70%
Portfolio turnover rate 96.81% 68.07% 62.24% 113.56% 31.78%
See accompanying notes to
financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
YEARS ENDED JUNE 30, 1995, 1994, 1993, 1992 AND 1991
GOVERNMENT/QUALITY BOND PORTFOLIO
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
NET ASSET VALUE:
Beginning of period $10.21 11.17 10.93 10.42 10.31
------ ----- ----- ----- -----
Income (loss) from investment operations:
Net investment income 0.60 0.54 0.64 0.73 0.57
Net realized and
unrealized gain
(loss) on investments 0.22 (0.75) 0.43 0.60 0.11
---- ------ ---- ---- ----
Total income (loss) from
investment 0.82 (0.21) 1.07 1.33 0.68
---- ------ ---- ---- ----
operations
Less distributions:
Dividends from net
investment income (0.60) (0.54) (0.64) (0.71) (0.51)
Distributions from
capital gains - (0.21) (0.19) (0.11) (0.06)
------- ------ ------ ------ ------
Total distributions (0.60) (0.75) (0.83) (0.82) (0.57)
------ ------ ------ ------ ------
End of period $10.43 10.21 11.17 10.93 10.42
====== ===== ===== ===== =====
TOTAL RETURN 9.42% (2.00%) 11.00% 12.79% 8.91%
===== ======= ====== ====== =====
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period $4,693,924 8,832,147 9,709,386 8,112,226 6,060,110
Ratio of expenses to
average net assets 1.47% 1.37% 1.38% 1.50% 1.58%
Ratio of net income to
average net assets 5.86% 4.94% 6.25% 6.64% 6.92%
Portfolio turnover rate 9.33% 218.11% 175.95% 507.52% 102.55%
See accompanying notes to
financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED JUNE 30, 1995
1. ORGANIZATION
SMITH HAYES Trust, Inc. (the Fund) is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Fund issues its shares in series, each series
representing a distinct portfolio with its own investment objectives and
policies. These financial statements relate only to the following
portfolios:
Asset Allocation Portfolio Small Cap Portfolio
Balanced Portfolio Value Portfolio
Convertible Portfolio Government/Quality Bond Portfolio
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following is a summary of
significant accounting policies employed by the Fund in preparing its
financial statements:
VALUATION OF INVESTMENTS
Investment securities are carried at market determined using the following
valuation methods:
o Securities traded on a national or regional stock exchange or included in
the NASDAQ National Market System are valued at the last quoted sales
price.
o Securities not listed on an exchange or securities for which a latest
quoted sales price is not readily available and securities traded
over-the-counter but not included in the NASDAQ National Market System
are valued at the mean of the closing bid and asked prices.
o Securities including bonds or other assets for which reliable recent
market quotations are not readily available are valued at fair market
value as determined in good faith or under the direction of The Board of
Directors. Determination of fair value involves, among other things,
reference to market indices, matrices and data from independent brokers
and pricing services.
All securities are valued in accordance with the above policies at the close
of each business day.
At June 30, 1995, the cost of investment securities is identical for
financial reporting and income tax purposes.
<PAGE>
SMITH HAYES TRUST, INC.
NOTES TO FINANCIAL STATEMENTS
2. CONTINUED
When a call option is written on behalf of a portfolio, an amount equal to
the premium received by the portfolio is included by the portfolio in the
portfolio's statement of assets and liabilities as a liability. The amount
of the liability is subsequently marked to market to reflect the current
value of the option written. The current market value of a traded option is
the last sales price on the principal exchange on which such options are
traded, or in the absence of such a sale, at the latest ask quotation. When
an option expires on its stipulated expiration date or the portfolio enters
into a closing purchase transaction, the portfolio realizes a gain (or loss
if the cost of a closing transaction exceeds the premium received when the
option was sold) without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is
extinguished. When an option is exercised, the portfolio realizes a gain or
loss from the sale of the underlying security and the proceeds from such
sale are decreased by the premium originally received.
When a put option is written, an amount equal to the premium paid by the
portfolio is included by the portfolio in the portfolio's statement of
assets and liabilities as an asset. The amount of the asset is subsequently
marked to market to reflect the current value of the option written. The
current market value of a traded option is the last sales price on the
principal exchange on which such options are traded, or in the absence of
such a sale, at the latest ask quotation. When an option expires on its
stipulated expiration date or the portfolio enters into a closing sales
transaction, the portfolio realizes a gain (or loss if the cost of a closing
transaction is lower than the premium paid when the option was sold) without
regard to any unrealized gain or loss on the underlying security, and the
asset related to such option is extinguished. When an option is exercised,
the portfolio realizes a gain or loss from the sale of the underlying
security and the proceeds from the sale are increased by the premium
originally paid.
At June 30, 1995, the portfolios authorized to write option contracts had no
such option contracts outstanding nor were any written during the period.
SECURITY TRANSACTIONS
Security transactions are accounted for on the date securities are purchased
or sold (trade date). Dividend income is recognized on the ex-dividend date
and interest income, including amortization of premium and discount on the
straight-line basis, is accrued daily.
Realized investment gains and losses are determined by specifically
identifying the issue sold.
<PAGE>
SMITH HAYES TRUST, INC.
NOTES TO FINANCIAL STATEMENTS
2. CONTINUED
FEDERAL INCOME TAXES
It is the policy of each portfolio to comply with requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute virtually all of the taxable income generated by the portfolios
to their shareholders within the time period allowed by Federal law. Each
portfolio is treated as a separate entity for tax purposes, and on a
calendar basis will distribute substantially all of its net investment
income and realized gains, if any, to avoid payment of any federal excise
tax. The portfolios will not distribute net realized losses. Distributions
will be made when capital gains have been generated to cover these losses.
Each portfolio prepares its tax return on an accrual basis.
DISTRIBUTIONS TO SHAREHOLDERS
Dividends to shareholders are recorded on the ex-dividend date.
CASH EQUIVALENTS
The Fund considers investments with a maturity of three months or less when
purchased to be cash equivalents.
3. RELATED PARTY TRANSACTIONS
The Fund and each of its portfolios have retained CONLEY SMITH, Inc.
(formerly SMITH HAYES Portfolio Management, Inc.) (the Adviser) as their
exclusive investment adviser. The agreement provides that each portfolio,
except the Government/Quality Bond Portfolio, will pay the Adviser a fee
equal to 1% per annum of the portfolio's average daily net assets. The
Government/Quality Bond Portfolio pays .60% per annum of its average daily
net assets.
The Fund and each of its portfolios have also retained Lancaster
Administrative Services, Inc. (the Administrator) to act as their
administrator to provide routine administrative services and to serve as
transfer agent. The agreement provides that the portfolios will pay an
administrative fee to the Administrator equal to .1875% per annum of the
average daily net assets of each portfolio.
In addition to the advisory and administrative services agreements, the
Trust and each portfolio have retained SMITH HAYES Financial Services
Corporation (the Distributor), a company related through common ownership
and management, to act as the underwriter and distributor of the portfolio's
shares. Pursuant to the shareholder approved distribution plan under Rule
12b-1, each portfolio will
<PAGE>
SMITH HAYES TRUST, INC.
NOTES TO FINANCIAL STATEMENTS
3. CONTINUED
reimburse the distributor for shareholder-related expenses incurred in
connection with the distribution of the portfolio's shares, however, under
no circumstances shall such reimbursement exceed .50% per annum of the
portfolio's average daily net assets (.40% for the Government/Quality Bond
Portfolio).
Under the terms of the advisory/administrative and distribution agreements
outlined above, the portfolios collectively paid $322,561 and $140,288,
respectively, for such services. Of the amount paid to the Distributor,
$121,994 was retained by them for sales of the Trust's shares made by their
agents and brokers.
At June 30, 1995, the following accrued investment management,
administrative fees and distribution expenses were payable to the Adviser,
Administrator and the Distributor:
Payable Payable Payable
to to to
Adviser Administrator Distributor Total
Asset Allocation Portfolio $1,596 $ 299 $ 890 $ 2,785
Balanced Portfolio 2,164 406 1,189 3,759
Convertible Portfolio 1,406 264 749 2,419
Small Cap Portfolio 7,441 1,395 3,838 12,674
Value Portfolio 1,326 249 741 2,316
Government/Quality
Bond Portfolio 2,284 714 1,643 4,641
======= ====== ====== =======
Under the terms of the adviser agreement, the Adviser may be obligated to
reimburse a portfolio up to the amount of the Adviser's fee paid to the
Adviser if during any year the expenses of the portfolio, including the
Adviser's fee, exceed certain limitations. At June 30, 1995, no expense
reimbursement was required.
In addition to the amounts paid by the portfolios under the adviser,
administrative and distribution plans, the portfolios primarily used SMITH
HAYES Financial Services Corporation (SMITH HAYES) to affect security trades
on their behalf. As is customary in the industry, the investment
sub-advisers evaluate the pricing and ability to execute the transaction in
selecting brokers to affect trades. SMITH HAYES was paid commissions in the
amount of $68,716 for their brokerage services during the period ended June
30, 1995.
<PAGE>
SMITH HAYES TRUST, INC.
NOTES TO FINANCIAL STATEMENTS
4. INVESTMENT
Cost of investment securities held at June 30, 1995, was as follows for each
portfolio:
Asset Allocation Portfolio $1,649,680
Balanced Portfolio 1,873,565
Convertible Portfolio 1,574,490
Small Cap Portfolio 7,846,854
Value Portfolio 1,399,304
Government/Quality Bond Portfolio 4,446,197
5. SECURITIES TRANSACTIONS
Purchases of securities and proceeds from sales during the year ended June
30, 1995, were as follows for each portfolio:
Purchases of Proceeds
Securities from Sales
Asset Allocation Portfolio $1,618,671 $ 5,320,722
Balanced Portfolio 3,021,333 6,015,846
Convertible Portfolio 1,089,325 2,209,887
Small Cap Portfolio 8,090,420 6,806,478
Value Portfolio 3,360,196 7,259,984
Government/Quality Bond Portfolio 6,397,615 10,703,201
At June 30, 1995, the aggregate gross unrealized appreciation and the
aggregate gross unrealized depreciation of securities in each portfolio were
as follows:
Aggregate Gross
Unrealized
Appreciation Depreciation
Asset Allocation Portfolio $ 244,549 $ 5,045
Balanced Portfolio 310,992 20,591
Convertible Portfolio 208,455 29,397
Small Cap Portfolio 1,539,100 213,129
Value Portfolio 169,849 27,528
Government/Quality Bond Portfolio 50,516 54,297
============ ==========
6. CAPITAL SHARE TRANSACTIONS
The Fund is authorized to issue a total of one billion shares of common
stock in series with a par value of $.001 per share. The following
summarizes the shares of each portfolio at June 30, 1995:
<PAGE>
SMITH HAYES TRUST, INC.
NOTES TO FINANCIAL STATEMENTS
6. (CONTINUED)
Shares
Authorized Outstanding
Asset Allocation Portfolio 10,000,000 192,164.376
Balanced Portfolio 10,000,000 226,168.951
Convertible Portfolio 10,000,000 147,406.527
Small Cap Portfolio 10,000,000 710,792.587
Value Portfolio 10,000,000 147,480.547
Government/Quality Bond Portfolio 10,000,000 450,012.783
Transactions in the capital stock of each portfolio for the year ended June
30, 1995, were as follows:
Asset
Allocation Balanced Convertible
Portfolio Portfolio Portfolio
Transactions in shares:
Shares sold 8,192.273 26,126.648 14,697.652
Shares redeemed (391,623.465) (448,429.652) (119,744.166)
Reinvested distributions 93,235.940 60,212.693 20,799.166
Net decrease (290,195.252) (362,090.311) (84,247.348)
Government/
Small Cap Value Quality Bond
Portfolio Portfolio Portfolio
Transactions in shares:
Shares sold 258,890.892 29,339.030 75,172.609
Shares redeemed (193,771.801) (391,689.929) (527,491.743)
Reinvested distributions 22,968.427 41,658.848 37,484.980
Net increase (decrease) 88,087.518 (320,692.051) (414,834.154)
At June 30, 1995, directors, officers and employees of the Fund, the
Adviser, Administrator and Distributor and their immediate families held the
following in each portfolio:
Shares Value
Asset Allocation 575.131 $ 5,964
Balanced Portfolio 152.468 1,662
Convertible Portfolio 2,849.095 34,104
Small Cap Portfolio 6,932.841 93,524
Value Portfolio 822.582 9,229
Government/Quality Bond Portfolio 4,731.099 49,345
========= ========
<PAGE>
SMITH HAYES TRUST, INC.
NOTES TO FINANCIAL STATEMENTS
7. BUSINESS CHANGES
On December 20, 1995, the Board of Directors of the Fund designated
50,000,000 shares of the authorized but unissued shares of the Fund to
establish the Capital Builder Fund. The Capital Builder Fund will commence
operations in the fall of 1995. Capitalization of the Capital Builder Fund
will occur, in part, through the combination of the Asset Allocation,
Balanced and Value Portfolios.
In April of 1995, the adviser SMITH HAYES Portfolio Management, Inc. changed
its name to CONLEY SMITH, Inc.
On July 18, 1995, the Board of Directors of the Fund approved the appointment
of Lancaster Administrative Services, Inc. successor to the transfer agent
and administrative services functions of the adviser CONLEY SMITH, Inc.
<PAGE>
SMITH HAYES TRUST, INC.
NEBRASKA TAX-FREE PORTFOLIO
ANNUAL REPORT
JUNE 30, 1995
<PAGE>
TABLE OF CONTENTS
Shareholder Letter............................. 1
Comparison Graph............................... 2
Independent Auditors' Report................... 3
Schedule of Investments........................ 4
Statement of Assets and Liabilities............ 11
Statement of Operations........................ 12
Statements of Changes in Net Assets............ 13
Financial Highlights........................... 14
Notes to Financial Statements.................. 15
<PAGE>
SMITH HAYES Trust, Inc.
To Fellow Shareholders:
The total return in the tax-exempt market was relatively favorable in the fiscal
year ended June 30, 1995. Based on the Lehman Brothers Municipal Bond Index, the
return for the fiscal year was 8.8%. During the same time frame, the
return on the Nebraska Tax-Free Portfolio was 8.5%.
During the fiscal year, there were two different markets. In the second half of
the calendar year 1994, the Federal Reserve Board, in an effort to moderate the
rate of growth in the economy and place some restraint on the inflation rate,
continued its policy of increasing the Federal Funds rate initiated earlier in
the year. As a consequence, there was a negative total return in the tax-exempt
market for the first half of the fiscal year.
With the market as a barometer, the Federal Reserve was apparently successful as
the rate of growth in the economy slowed, interest rates declined, and bond
prices increased during the first six months of 1995. As a consequence, the
return on the Portfolio was 10% for the period and 8.5% for the full year.
At the present time, most economists anticipate that the economy will continue
to grow at a moderate rate throughout 1995 and 1996 with inflation remaining in
check. As a consequence, interest rates are not expected to evidence the same
volatility experienced over the past 12 months. Therefore, we believe the return
in current year will be more reflective of interest income than from changes in
market prices.
Recently there have been discussions regarding possible changes in the tax
legislation, which could reduce the benefits of owning tax-exempt securities.
While the outcome is uncertain, at this time, we plan to maintain a relatively
short maturity schedule with an average life of probably less than seven years.
Although the yield curve is relatively flat beyond ten years, this strategy will
sacrifice some yield, but will provide a greater level of protection to capital
in the event that significant changes are made to the tax structure.
Please contact your Nebraska Tax-Free Portfolio representative if you have
any questions regarding your investment.
Sincerely,
John H. Conley
President July 20, 1995
<PAGE>
GRAPH
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN NEBRASKA TAX-FREE
PORTFOLIO AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
AVG. ANNUAL RETURN FOR NEBRASKA TAX FREE
1 YEAR 8.46%
INCEPTION 3.39%
06/30/95 VALUE
NEBRASKA TAX-FREE PORTFOLIO $10, 261.53
LEHMAN BROS. MUNICIPAL $10,900.73
Past performance is not predictive of future performance.
Results reflect payment of a maximum sales charge of 3.9% on the $10,000
investment with dividends reinvested.
For the period July 12, 1993 through June 30, 1995.
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
SMITH HAYES Trust, Inc.
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of the SMITH HAYES Trust, Inc. Nebraska Tax-Free
Portfolio as of June 30, 1995, the related statements of operations and changes
in net assets, and the financial highlights for the year then ended. These
financial statements and financial highlights are the responsibility of the
Portfolio's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audit. The statement
of changes in net assets and the financial highlights for the period from July
12, 1993 (commencement of operations) to June 30, 1994 were audited by other
auditors whose report dated July 22, 1994, expressed an unqualified opinion on
such statement and such financial highlights.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of June 30, 1995 by
correspondence with the custodian and brokers. An audit also includes assessing
the accounting principles used and significant estimates made by management as
well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of the SMITH HAYES
Trust, Inc. Nebraska Tax-Free Portfolio as of June 30, 1995, the results of its
operations, changes in its net assets, and financial highlights for the year
then ended, in conformity with generally accepted accounting principles.
Deloitte & Touche LLP
Lincoln, Nebraska
July 21, 1995
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
SCHEDULE OF INVESTMENTS
JUNE 30, 1995
PERCENT
OF NET
PRINCIPAL ASSETS MARKET
AMOUNT 98.72% VALUE
- ---------- ------ --------
Education 11.65%
--------- -----
200,000 Nebraska Educational Facilities Authority
Revenue Bonds, Series
1993 (Nebraska Wesleyan University Project), $198,238
5.55% due 9/1/07
100,000 Nebraska Educational Finance Authority Revenue
Bonds, Series
1994 (Dana College Project), 6.75% due 6/1/14 104,565
200,000 Nebraska Educational Finance Authority Revenue
Bonds, Series
1995 (Midland Lutheran College Project), 194,446
6.25% due 6/15/15
300,000 Nebraska Higher Education Loan Program, Inc.
Junior Subordinate
Bonds, Series A-6, 6.40% due 6/1/13 299,471
100,000 Nebraska State College Revenue Bonds, Series
1992, 5.00%
due 6/15/97 100,811
100,000 Nebraska State Educational Service Unit No. 3
Series 1993 A,
5.50% due 6/1/13 93,095
100,000 University Nebraska Facilities Corp. Hospital
Revenue Bonds,
Series 1993, (University of Nebraska Medical
Center Project)
5.35% due 1/1/07 98,250
150,000 University Nebraska Revenue Bonds, Series
1993, (University of
Nebraska at Omaha Student Center Project) 137,452
5.30% due 5/15/12 ----------
1,226,328
----------
Electric, Water, Sewer 13.72%
----------------------- ------
300,000 City of Grand Island, Sewer System Revenue
Bonds
Series 1994, 6.00% due 4/1/14 296,251
250,000 City of Grand Island Nebraska Electric Revenue
Bonds
5.60% due 9/1/97 $255,868
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT ASSETS VALUE
- -------- --------- --------
Electric, Water, Sewer (Continued)
------------------------------------
100,000 City of Hastings, Nebraska Combined Utility
Revenue Bonds
Series 1994, 6.875% due 10/15/14 $104,846
200,000 City of Hastings, Nebraska Electric System
Revenue Refunding
Bonds, Series 1993, 5.00% due 1/1/08 187,206
100,000 City of Kearney, Nebraska Combined Utilities
Revenue Refunding
Bonds, Series 1993, 5.25% due 6/1/01 102,058
200,000 City of Kearney, Nebraska Combined Utilities
Revenue Refunding
Bonds, Series 1994, 6.10% due 6/1/14 203,910
100,000 City of Lincoln, Nebraska Electric System
Revenue Refunding
Bonds, 1993 Series A, 5.20% due 9/1/08 $96,205
205,000 City of Lincoln, Nebraska Electric System
Revenue Refunding
Bonds, 1992 Series A (Power Supply 197,624
Facilities), 5.75% due 9/1/16 ---------
1,443,968
----------
General Obligation 23.57%
------------------ -------
50,000 Boyd County Nebraska School District No. 38
(Spencer - Naper)
General Obligation Bonds, 5.85% due 6/15/13 47,599
150,000 Buffalo County Nebraska School District No.
105 (Pleasanton)
General Obligation Bonds, Series 1993, 153,981
5.95% due 12/15/07
120,000 Colfax County Nebraska School District No. 2
(Schuyler)
General Obligation Bonds, Series 1993, 5.65% 117,676
due 12/15/09
150,000 Colfax County Nebraska School District No. 2
(Schuyler)
General Obligation Bonds, Series 1993, 5.75% $145,346
due 2/15/11
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT ASSETS VALUE
- -------- ------- -------
General Obligation (Continued)
---------------------------------
100,000 Douglas County Nebraska Sanitary and
Improvement District No. 257
General Obligation Refunding Bonds (Ramble
Ridge),
6.25% due 5/15/09 $103,184
100,000 Douglas County Nebraska School District No.
010, (Elkhorn
Public Schools) General Obligation Bonds,
Series of 1994
6.40% due 12/15/06 100,000
150,000 Douglas County Nebraska School District No.
010, (Elkhorn
Public Schools) General Obligation Bonds,
Series of 1994
6.40% due 12/15/08 156,852
100,000 Douglas County Nebraska School District No.
010, (Elkhorn
Public Schools) General Obligation Bonds,
Series of 1994
6.60% due 12/15/10 104,726
100,000 Douglas County Nebraska School District No.
010, (Elkhorn
Public Schools) General Obligation Bonds,
Series of 1994
6.75% due 12/15/14 104,571
250,000 Hall County, Nebraska School District No. 2
General Obligation
Bonds, 5.15% due 12/1/14 229,677
100,000 Keith County School District 001 Nebraska,
(Ogallala Public School)
General Obligation School Building Bond,
Series 1994B,
6.30% due 11/15/09 102,990
210,000 Lancaster County School District 001 (Lincoln)
Lease Purchase
General Obligation Bonds, 6.3273% due 8/31/95 210,000
100,000 Lincoln-Lancaster County Public Building
Commission
General Obligation Bonds, Series 1994, 6.20% 101,529
due 10/15/11
100,000 Morrill County Nebraska School District No.
021, (Bayard)
General Obligation Bonds, 5.80% due 5/15/06 $101,466
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT ASSETS VALUE
- ---------- ----------- ------
General Obligation (Continued)
---------------------------------
100,000 City of North Platte Nebraska General
Obligation Various
Purpose Bonds, Series 1995, 6.20% due 3/15/15 $99,679
130,000 Papillion, Nebraska Municipal Facilities
Corporation Refunding
Bonds (Recreational Facilities Project), 122,264
5.45% due 1/1/10
175,000 Saunders County, Nebraska School District #107
Cedar Bluffs
Public Schools, General Obligation Bonds, 177,238
6.35% due 7/1/14
150,000 Washington County, Nebraska School District
001, Blair Community
Schools, General Obligation Bonds, 5.90% due 147,401
7/15/15
150,000 Western Nebraska Community College
Certificates of Participation
Lease Rentals, 6.55% due 10/15/13 154,018
----------
2,480,197
----------
Hospital 8.01%
--------------- -----
125,000 Douglas County Nebraska Hospital Authority No.
2 Revenue
Bonds, Health Care Facilities (Catholic
Health Care Corp. A),
6.00% due 11/15/15 123,312
100,000 Douglas County Nebraska Hospital Authority No.
1 Revenue
Bonds, Health Care Facilities (Archbishop
Bergan Mercy),
6.25% due 11/15/22 97,927
100,000 Gage County Nebraska Hospital Authority No.1
Hospital Revenue
Bonds, (Beatrice Community Hospital and
Health Center Project),
6.40% due 10/1/07 105,279
200,000 Gage County Nebraska Hospital Authority No.1
Hospital Revenue
Bonds, (Beatrice Community Hospital and
Health Center Project),
6.75% due 10/1/14 $209,356
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT ASSETS VALUE
- -------- --------- -------
Hospital (Continued)
-------------------------
100,000 Kearney County Nebraska Hospital Authority No.
1 Revenue
Bonds, Series 1993 (Bethpage Mission, of the
Great Plains, Inc.),
5.90% due 6/1/07 $102,141
200,000 Lancaster County Nebraska Hospital Authority
Hospital
Revenue Bonds, Series 1992 A (Sisters of
Charity Health Care
Systems, Inc.), 6.25% due 5/15/12 205,154
---------
843,169
---------
Housing 19.97%
---------- ---------
150,000 Nebraska Investment Finance Authority Hospital
Revenue Bonds,
(Great Plains Regional Medical Center 154,515
Project), 6.50% due 5/15/14
200,000 Nebraska Investment Finance Authority Hospital
Revenue Bonds,
(Nebraska Methodist Healthcare System), 212,382
6.55% due 3/1/99
90,000 Nebraska Investment Finance Authority Revenue
Bonds,
(Foundation Educational Building Fund), 92,086
7.00% due 11/1/09
190,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1995 Series A, 6.05% due 196,604
9/1/07
105,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1995 Series A, 6.10% due 108,264
3/1/08
100,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1995 Series A, 6.15% due 102,786
3/1/09
100,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1995 Series B, 6.00% due 100,000
9/1/09
100,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1995 Series A, 6.20% due $102,465
9/1/10
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT ASSETS VALUE
- ---------- -------- -------
Housing (Continued)
-----------------------
200,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1994 Series A-1, 6.30% due $204,752
3/1/17
250,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1995 Series B, 6.40% due 248,300
9/1/26
500,000 Nebraska Investment Finance Authority Single
Family Housing
Revenue Bonds, 1994 Series D-1, 7.30% due 579,281
9/1/26 ---------
2,101,435
----------
Power 10.89%
----- -----
240,000 Cornhusker Public Power District Nebraska
Electric System
Revenue and Refunding Bonds, Series 1993, 227,537
5.80% due 3/1/16
100,000 McCook Nebraska Public Power District Electric
System Revenue
and Refunding Bonds, 6.75% due 12/15/09 104,949
200,000 Municipal Energy Agency of Nebraska Power
Supply System
Revenue Refunding Bonds, 1992 Series A, 198,964
6.00% due 4/1/17
250,000 Nebraska Public Power District Electric System
Revenue Bonds,
Series 1993 A, 5.40% due 1/1/09 242,781
150,000 Nebraska Public Power District Revenue Bonds,
Power
Supply System, Series C, 5.00% due 1/1/17 132,071
250,000 Omaha Public Power District Nebraska Electric
Revenue Bonds,
Series B, 5.70% due 2/1/17 240,212
---------
1,146,514
----------
Transportation 1.81%
-------------- -------
100,000 Omaha, Nebraska Airport Authority Airport
Facilities Revenue
Refunding Bonds, Series 1993, 5.50% due $95,288
1/1/13
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
PERCENT
PRINCIPAL OF NET MARKET
AMOUNT ASSETS VALUE
- ---------- -------- ------
Transportation (Continued)
----------------------------
100,000 Omaha, Nebraska Airport Authority Airport
Facilities Revenue
Refunding Bonds, Series 1993, 5.50% due $94,753
1/1/14 --------
190,041
--------
Various Revenues 9.10%
------------------- ----
150,000 District Energy Corporation Nebraska Facility
Revenue Bonds,
Series 1993 (City-County Building and County
Correctional
Family Project), 5.50% due 7/1/13 139,473
250,000 City of Lincoln, Nebraska Parking Revenue
Bonds,
Series 1994 C, 6.10% due 8/15/09 255,930
100,000 City of Lincoln, Nebraska Parking Revenue
Bonds,
Series 1994 C, 6.15% due 8/15/11 101,012
200,000 Nebraska Public Gas Agency Gas Supply System
Revenue
Bonds, Series A, 6.25% due 4/1/05 207,934
250,000 County of Scottsbluff, Nebraska Development
Revenue Bonds
Series 1995, (Northfield Villa, Inc. - The
Residency Project),
6.90% due 4/1/20 252,938
-------
957,287
Total Investments in Securities 98.72% $10,388,939
------ -----------
Cash Equivalents 1.20% 126,443
----- -------
Net Receivables/(Pay 0.08% 8,483
----- -----
TOTAL NET ASSETS 100.00% $10,523,865
------ -----------
See a accompanying notes to financial statements.
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1995
Assets:
Investments in securities, at market value (cost $10,386,947) $10,388,939
Cash equivalents 126,443
Accrued interest and dividends receivable 166,643
----------
Total assets 10,682,025
----------
Liabilities:
Accrued expenses, including investment management,
administration and distribution expense reimbursements
payable to the adviser, administrator and distributor (note 3) 8,910
Payable for investment securities purchased 149,250
-------
Total liabilities 158,160
----------
Net assets applicable to outstanding capital stoc $10,523,865
============
Net assets are represented by:
Capital stock outstanding, at par 1,084
Additional paid-in capital 10,806,353
Accumulated undistributed net investment income 23,899
Accumulated undistributed net realized loss (309,463)
Unrealized appreciation (note 4) 1,992
-----
Total amount representing net assets applicable to
1,083,952.672 outstanding shares of $.001 par value
common stock (10,000,000 shares authorized) $10,523,865
===========
Net asset value per share $9.71
=====
See accompanying notes to financial statements.
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
STATEMENT OF OPERATIONS
Year Ended June 30, 1995
Investment Interest Income: $582,521
--------
Expenses (note 3):
Investment advisory and administration fees 24,854
Distribution expenses 24,873
Custodial fees 6,091
Auditing and tax accounting fees 3,292
Legal fees 3,336
Registration fees 3,561
Other operating expenses 4,756
------
Total expenses 70,763
------
Net investment income 511,758
-------
Realized loss and unrealized appreciation on investments (note 4):
Net realized loss (289,202)
--------
Net unrealized appreciation (depreciation)
Beginning of period (579,636)
End of period 1,992
---------
Net unrealized appreciation 581,628
---------
Net realized and unrealized gain on investments 292,426
---------
Net increase in net assets resulting from operations $804,184
=========
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
NEBRASKA TAX-FREE PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended June 30, 1995, and for the period
July 12, 1993 (commencement of operations) to June 30, 1994
1995 1994
Operations:
Net investment income $511,758 342,358
Net realized loss on investments (289,202) (20,261)
Unrealized appreciation (depreciation)
on investments 581,628 (579,636)
------ ---------
Net increase (decrease) in net assets
resulting from operations 804,184 (257,539)
------- ---------
Dividends paid to shareholders from net investment income: 506,537 323,680
------- -------
Capital share transactions:
Proceeds from shares sold (403,726.098 and
1,299,187.212 shares) 3,175,403 13,048,062
Distributions reinvested (25,799.151 and
14,958.568 shares) 242,880 147,612
Payment for redemptions (221,835.048 and
370,310.236 shares) (2,085,987) (3,720,533)
------------ -----------
Net increase from capital share transactions
( 207,690.201 and 943,835.544shares) 1,332,296 9,475,141
--------- ---------
Total increase in net assets 1,629,943 8,893,922
Net assets:
Beginning of period 8,893,922 -
------------ ---------
End of period $10,523,865 8,893,922
=========== =========
See accompanying notes to financial statements.
<PAGE>
NEBRASKA TAX-FREE PORTFOLIO
FINANCIAL HIGHLIGHTS
Year Ended June 30, 1995, and for the period
from July 12, 1993 (commencement of operations)
to June 30, 1994
1995 1994
---- ----
Net asset value:
Beginning of period $9.42 $10.00
----- ------
Income (loss) from investment operations:
Net investment income 0.48 0.50
Net realized and unrealized gain (loss) on 0.29 (0.63)
---- ------
investments
Total gain (loss) from investment operations 0.77 (0.13)
---- ------
Less distributions from net investment income (0.48) (0.45)
------ ------
End of period (1) $9.71 $9.42
===== =====
Total return 8.5% (1.6%) **
==== ========
Ratios/Supplemental data:
Net assets, end of period $10,523,865 $8,893,922
----------- ----------
Ratio of expenses to average net assets 0.71% 0.41% **
Ratio of net income to average net assets 5.15% 4.99% **
Portfolio turnover rate 34.96% 7.45%
**Annualized
(1) Excludes maximum sales charge of 3.90%
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
Notes to Financial Statements
Year Ended June 30, 1995
1. Organization SMITH HAYES Trust, Inc. (the Fund) is registered under the
Investment Company Act of 1940, as amended, as an open-end management
investment company. These financial statements apply only to the Nebraska
Tax-Free Portfolio (the Portfolio).
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies employed by
the Portfolio in preparing its financial statements:
Valuation of Investments: Portfolio securities are valued at fair market
value as determined in good faith or under the direction of the Board of
Directors. Determination of fair value involves, among other things,
reference to market indices, matrices and data from independent brokers and
pricing services.
All securities are valued in accordance with the above policies at the close
of each business day provided that the Portfolio has shareholder activity.
At June 30, 1995, the cost of investment securities is identical for
financial reporting and income tax purposes.
Securities Transactions: Securities transactions are accounted for on the
date securities are purchased or sold (trade date). Interest income,
including amortization of premium and discount on the straight-line basis,
is accrued daily. Realized investment gains or losses are determined by
specifically identifying the security sold.
Federal Income Taxes: It is the policy of the Portfolio to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute virtually all of its taxable income, including
any net realized gain on investments, to its shareholders. Therefore, no
Federal income tax provision is required. The Portfolio prepares its tax
return on an accrual basis.
Distributions to Shareholders: Dividends to shareholders are recorded on
the ex-dividend date.
Cash Equivalents: The Fund considers investments with a maturity of three
months or less when purchased to be cash equivalents.
<PAGE>
SMITH HAYES TRUST, INC.
Notes to Financial Statements
3. Related Party Transactions
The Portfolio has retained CONLEY SMITH, Inc. (formerly SMITH HAYES
Portfolio Management, Inc.) (the Adviser) as its exclusive investment
adviser. The agreement provides that the Portfolio will pay the Adviser a
fee equal to .15% per annum of its average daily net assets.
The Portfolio has also retained Lancaster Administrative Services, Inc.
(the Administrator) to act as its administrator to provide routine
administrative services and act as the transfer agent. The agreement
provides that the Portfolio will pay a fee to the Administrator equal to
.10% per annum of the average daily net assets.
In addition to the advisory and administrative services agreements, the
Portfolio has retained SMITH HAYES Financial Services Corporation (the
Distributor), a company related through common ownership and management, to
act as the underwriter and distributor of the Portfolio's shares. Pursuant
to the distribution plan under Rule 12b-1, the Portfolio will reimburse the
Distributor for shareholder-related expenses incurred in connection with the
distribution of the Portfolio's shares, however under no circumstances shall
such reimbursement exceed .25% per annum of the Portfolio's average daily
net assets.
Under the terms of the advisory, administrative and distribution agreements
outlined above, the Portfolio paid $24,854 to the Adviser/Administrator, and
$24,873 to the Distributor for sales of the Portfolio's shares made by their
agents and brokers. The Distributor also received $22,103 and retained
$4,828 (after allowances to dealers) as its portion of the sales charges
paid by purchasers of the Portfolio shares. Such sales charges are not an
expense of the Fund and hence are not reflected in the accompanying
statement of operations.
At June 30, 1995 the Portfolio had accrued sales charges of $1,769 payable
to the Distributor.
Under the terms of the advisory agreement, the Adviser may be obligated to
reimburse the Portfolio up to the amount of the Adviser's fee paid to the
Adviser if during any year the expenses of the Portfolio, including the
Adviser's fee, exceed certain limitations. At June 30, 1995 no expense
reimbursement was required.
<PAGE>
SMITH HAYES TRUST, INC.
Notes to Financial Statements
3. Continued
In addition to the amount paid by the Portfolio under the advisory,
administration and distribution plans, the Portfolio used SMITH HAYES
Financial Services Corporation (SMITH HAYES) to affect security trades on
their behalf. SMITH HAYES was paid commissions in the amount of $38,418 for
their brokerage services during the period ended June 30, 1995.
At June 30, 1995, the directors, officers, and employees of the Fund, the
Adviser, Administrator and Distributor and their immediate families held
4,176.590 shares at a value of $40,555.
4. Securities Transactions
The Portfolio made purchases and sales of investment securities of
$4,932,486 and $3,409,075, respectively, during the period ended June 30,
1995.
At June 30, 1995, the aggregate gross unrealized appreciation and the
aggregate gross unrealized depreciation of securities were $206,888 and
$204,896, respectively.
5. Business Changes
In April of 1995, the adviser SMITH HAYES Portfolio Management, Inc.
changed its name to CONLEY SMITH, Inc.
On July 18, 1995, the Board of Directors of the SMITH HAYES Trust, Inc.
approved the appointment of Lancaster Administrative Services, Inc.
successor to the transfer agent and administrative services functions of
the adviser CONLEY SMITH, Inc.
<PAGE>
- -------------------------------------------------------------------------------
SMITH HAYES
TRUST, INC.
MONEY MARKET PORTFOLIO
INSTITUTIONAL MONEY MARKET PORTFOLIO
ANNUAL REPORT
JUNE 30, 1995
<PAGE>
TABLE OF CONTENTS
Independent Auditors' Report........... 1
Statement of Net Assets
Institutional Money Market Portfolio 2
Statement of Operations................ 3
Statements of Changes in Net Assets.... 4
Financial Highlights
Money Market Portfolio.............. 5
Institutional Money Market Portfolio 6
Notes to Financial Statements.......... 7
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
SMITH HAYES Trust, Inc.
We have audited the accompanying statement of net assets of SMITH HAYES Trust,
Inc. Institutional Money Market Portfolio as of June 30, 1995, and the related
statements of operations and changes in net assets, and the financial highlights
for the year then ended of the SMITH HAYES Trust, Inc. Money Market and
Institutional Money Market Portfolios. These financial statements and financial
highlights are the responsibility of the Portfolio's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audit. The statement of changes in net assets
for the year ended June 30, 1994 and the financial highlights for the period
November 12, 1992 (commencement of operations) to June 30, 1994 were audited by
other auditors whose report dated July 22, 1994, expressed an unqualified
opinion on such statements and such financial highlights.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of June 30, 1995 by
correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of the SMITH HAYES
Trust, Inc. Institutional Money Market Portfolio as of June 30, 1995, and the
results of operations, changes in net assets, and financial highlights of the
SMITH HAYES Trust, Inc. Money Market and Institutional Money Market Portfolios
for the year then ended, in conformity with generally accepted accounting
principles.
Deloitte & Touche LLP
Lincoln, Nebraska
July 21, 1995
<PAGE>
SMITH HAYES TRUST, INC.
INSTITUTIONAL MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
June 30, 1995
Yield
at
Par Time of Amortized
Value Description Purchase Cost
- --------------- ------------------------- ---------- -----------
Certificates of
Deposit -- 2%
95,000 First Bank & Trust Company,
Cozad, Nebraska, due 12/16/95 6.14% $95,000
95,000 Curtis State Bank,
Curtis Nebraska, due 3/16/96 6.25% 95,000
95,000 Farmers State Bank,
Carroll Nebraska, due 6/16/96 6.92% 95,000
95,000 Minden Exchange Bank & Trust
Company
Minden Nebraska, due 6/27/96 6.35% 95,000
-------
Total (cost $380,000) 380,000
Government Securities -- 3%
300,000 U.S. Treasury Bill, due 7/6/95 5.48% $496,899
500,000 U.S. Treasury Bill, due 8/10/95 5.60% 299,780
--------
Total (cost $796,679) 796,679
-------
Trust Certificates - U.S. Government Guaranteed Student
Loans -- 90%
22,000,000 Mid-America Student Finance
Trust, due
1/09/96 to 6/29/96 (cost 6.15% *
$22,000,000)
$22,000,000
------------
Total Investments -- 95% 23,176,679
Excess of other Assets over Total Liabilities -- 5%
(Includes $9,287 payable to investment adviser
and distributor and $88,320 dividends payable to
shareholders) 1,160,257
----------
Net Assets -- 100%
Applicable to 24,336,936 outstanding shares of $.001
par value common stock (100,000,000 shares authorized) $24,336,936
==========
Net Asset Value:
Offering and redemption price per share $1.00
=====
*Interest rate fluctuates with 3-month U.S.Treasury Bill rate, subject to no
longer than 5-day settlement.
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENT OF OPERATIONS
Year Ended June 30, 1995
Institutional
Money Money
Market Market
Portfolio Portfolio
Investment Interest Income $384,872 1,186,961
-------- ---------
Expenses (note 2):
Investment advisory and
administration fees 14,222 43,815
Distribution fee 45,258 39,836
Custodial fees 5,169 10,675
Auditing and tax accounting fees 3,103 3,717
Legal fees 2,119 6,804
Other expenses 1,575 1,956
----- -----
Total expenses 71,446 106,803
------ -------
Net Investment Income $313,426 1,080,158
========= =========
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
STATEMENTS OF CHANGES IN NET ASSETS
Years Ended June 30, 1995 and 1994
Institutional
Money Money
Market Market
Portfolio Portfolio
1995 1994 1995 1994
--------- --------- ---------- ---------
From Investment Operations:
Net investment income
distributed to $313,426 329,239 1,080,158 1,104,578
========= ======== ========== ===========
shareholders
From Share Transactions:
(at constant net asset
value of $1 per share)
Shares sold 14,228,361 28,022,243 61,906,153 82,557,309
Shares issued in
reinvestment
of dividends from net
investment income 296,731 159,003 693,024 477,389
---------- --------- ----------- ----------
14,525,092 28,181,246 62,599,177 83,034,698
Shares redeemed 22,067,396 27,313,566 66,271,044 69,881,334
---------- ---------- ---------- ----------
Total increase (decrease) in
net assets derived
from share
transactions (7,542,304 867,680 (3,671,867)13,153,364
Net Assets:
Beginning of period 7,542,304 6,674,624 28,008,803 14,855,439
--------- --------- ---------- ----------
End of period $ - 7,542,304 24,336,936 28,008,803
--------- ---------- ---------- ----------
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
Years Ended June 30, 1995 and 1994 and the
Period from November 12, 1992 (commencement of operations) to June
30, 1993
Money Market
Portfolio
1995 1994 1993
---- ---- ----
Net asset value:
Beginning of period $1.00 1.00 1.00
----- ---- ----
Income from investment operations,
Net investment income 0.048 0.035 0.009
Less distributions,
Dividends from net investment (0.048) (0.035) (0.009)
------- ------- -------
income
End of period $1.00 1.00 1.00
===== ==== ====
Yield 5.05% 3.85% 3.83% *
===== ===== =====
Effective yield 5.18% 3.92% 3.90% *
===== ===== =====
Ratios/Supplemental data:
Net assets, end of period - 7,542,304 6,674,624
--------- ---------- ---------
Ratio of expenses to average net assets 1.10% 1.17% 1.21% *
----- ----- -----
Ratio of net income to average net assets 4.83% 3.50% 3.99% *
----- ----- -----
*Annualized for those periods less than twelve months in duration.
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
FINANCIAL HIGHLIGHTS
Years Ended June 30, 1995 and 1994 and the
Period from November 12, 1992 (commencement of operations) to June
30, 1993
Institutional
Money Market
Portfolio
1995 1994 1993
---- ---- ----
Net asset value:
Beginning of period $1.00 1.00 1.00
----- ---- ----
Income from investment operations,
Net investment income 0.054 0.040 0.009
----- ----- -----
Less distributions,
Dividends from net investment (0.054) (0.040) (0.009)
------- ------- -------
income
End of period $1.00 1.00 1.00
===== ==== ====
Yield 5.63% 4.52% 4.28% *
===== ===== =====
Effective yield 5.79% 4.62% 4.37% *
===== ===== =====
Ratios/Supplemental data:
Net assets, end of period $24,336,936 28,008,803 14,855,439
- ----------- ---------- ----------
Ratio of expenses to average net assets 0.54% 0.61% 0.68% *
----- ----- -----
Ratio of net income to average net assets 5.42% 4.05% 4.40% *
----- ----- -----
*Annualized for those periods less than twelve months in duration.
See accompanying notes to financial statements.
<PAGE>
SMITH HAYES TRUST, INC.
Notes to Financial Statements
Year Ended June 30, 1995
1. Organization and Significant Accounting Policies
- --------------------------------------------------------
SMITH HAYES Trust, Inc. (the Fund) is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
These financial statements relate only to the Money Market and Institutional
Money Market Portfolios (the Portfolios).
The following is a summary of significant accounting policies employed by
the Fund in preparing its financial statements.
Valuation of Investments: Portfolio securities are valued at amortized
cost. Pursuant to Rule 2a-7 of the Investment Company Act of 1940, amortized
cost as defined is a method of valuing securities at acquisition cost, adjusted
for amortization of premium or accretion of discount rather than at their value
based on current market factors. This method of valuation is used consistently
throughout the industry by money market funds wishing to maintain a constant net
asset value per share. Each of the Portfolios maintains a constant net asset
value of $1 per share.
Security Transactions and Investment Income: Security transactions are
recorded on a trade date basis. Realized gains or losses on sales of investments
are determined by specifically identifying the issue sold. In computing net
investment income, the Portfolios amortize premiums and discounts and accrue
interest income daily.
Federal Income Taxes: It is the policy of each Portfolio to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to have each Portfolio distribute virtually all of its taxable
income generated to each Portfolio's shareholders. Therefore, no liability for
Federal income taxes is required. Each Portfolio is treated as a separate entity
for Federal income tax purposes, and on a calendar year basis, will distribute
substantially all of its net investment income and realized gains, if any, to
avoid the payment of any Federal excise taxes. Each Portfolio prepares its tax
return on an accrual basis.
Distributions to Shareholders: Dividends to shareholders are accrued and
declared daily from net investment income. Payments or reinvestments of
dividends are made monthly.
<PAGE>
SMITH HAYES TRUST, INC.
Notes to Financial Statements
1. Continued
- ------------
Trust Certificates: The trust certificates represent U. S. Government
guaranteed student loans held by Mid-America Student Finance Trust (the Trust).
The Trust invests in eligible student loans issued under the Higher Education
Act of 1965 as amended (the Act) established by the U. S. Government to provide
access to funds for students attending post-secondary institutions. The Trust
purchases the student loans from Nebraska and Iowa banks who are eligible
lenders as defined by the Act. The terms of the loans, which vary on an
individual basis, generally provide for repayment in monthly installments over a
period normally not in excess of ten years.
All of the student loans are guaranteed by various authorized guarantee
agencies who have contracts of reinsurance with the Department of Education.
These guarantees are made subject to the performance of certain loan servicing
procedures stipulated by the Act. If these due diligence requirements are not
met, the affected loans may not be covered by the guarantees should the borrower
default.
For liquidity purposes, certain banks have entered into unconditional
agreements to repurchase a predetermined amount of student loans from the Trust
upon five days written notice. The maximum amount any bank is obligated to
repurchase is five percent of the total student loans owned by the Trust. The
repurchase agreements are cancelable with 30 days advance written notice. At
June 30, 1995, 35 banks have entered into repurchase agreements for an aggregate
total of $47,000,000.
2. Management Fee, Distribution Expense and Transactions with
Affiliates
- ---------------------------------------------------------------
The Portfolios have retained CONLEY SMITH, Inc. (formerly SMITH HAYES
Portfolio Management, Inc.) (the Adviser) as their exclusive investment adviser.
Under the terms of the agreement the adviser is paid a monthly fee computed at
an annual rate of .10% of the average daily net assets of each Portfolio.
The Portfolios have also retained Lancaster Administrative Services, Inc.
(the Administrator) to act as their administrator and transfer agent. The
agreements provide for a fee computed and paid monthly at an annual rate of .12%
of the average daily net assets of each Portfolio.
The Portfolios have retained SMITH HAYES Financial Services Corporation
(the Distributor), a company related through common ownership and management, to
act as the underwriter and distributor of the Portfolio's shares. Pursuant to
the shareholder approved distribution plan under Rule 12b-1, the Portfolios will
reimburse the
<PAGE>
SMITH HAYES TRUST, INC.
Notes to Financial Statements
2. Continued
- -------------
Distributor for shareholder-related expenses incurred in connection with
the distribution of the Portfolio's shares. Aggregate payments cannot exceed the
annual rate of .70% for the Money Market Portfolio and .20% for the
Institutional Money Market Portfolio of the average daily net assets.
Under the terms of the advisory/administrative and distribution agreements
outlined above, the Portfolios collectively paid $58,037 and $85,094,
respectively, for such services.
In addition to the amounts paid under the advisory, administration and
distribution plans, the Portfolios primarily used SMITH HAYES Financial Services
Corporation (SMITH HAYES) to affect security trades on their behalf. As is
customary in the industry, the adviser evaluates the pricing and ability to
execute the transaction in selecting brokers to affect trades. SMITH HAYES was
paid commissions in the amount of $2,775 for their brokerage services during the
period ended June 30, 1995.
At June 30, 1995, the directors, officers, and employees of the Fund, the
Adviser, Administrator, Distributor and their immediate families held 1,134,632
shares of Institutional Money Market Portfolio, which constituted 4.66% of the
Portfolio's outstanding shares.
2. Business Changes
- -------------------
Effective June 22, 1995, the minimum initial aggregate investment in the
Institutional Money Market Portfolio was reduced from $500,000 to $1,000.
Consequently, all shareholders of the Money Market Portfolio redeemed their
shares for Institutional Money Market Portfolio shares. As of June 30, 1995
shares of the Money Market Portfolio will no longer be issued.
In April of 1995, the adviser SMITH HAYES Portfolio Management, Inc.
changed its name to CONLEY SMITH, Inc.
On July 18, 1995, the Board of Directors of the SMITH HAYES Trust, Inc.
approved the appointment of Lancaster Administrative Services, Inc. successor to
the transfer agent and administrative services functions of the adviser CONLEY
SMITH, Inc.
