SEMI-ANNUAL REPORT
SIX MONTHS ENDED APRIL 30, 1998
<PAGE>
WESTON PORTFOLIOS
CONTENTS
- ------------------------------------------------------------------------------
PRESIDENT'S LETTER 1
NEW CENTURY CAPITAL PORTFOLIO
Portfolio of Investments
April 30, 1998 2
Statement of Assets and Liabilities
April 30, 1998 4
Statement of Operations
Six months ended April 30, 1998 5
Statement of Changes in Net Assets
Six months ended April 30, 1998 and year ended October 31, 1997 6
Financial Highlights
Six months ended April 30, 1998 and
each of the five years in the period ended October 31, 1997 7
NEW CENTURY I PORTFOLIO
Portfolio of Investments
April 30, 1998 8
Statement of Assets and Liabilities
April 30, 1998 10
Statement of Operations
Six months ended April 30, 1998 11
Statement of Changes in Net Assets
Six months ended April 30, 1998 and year ended October 31, 1997 12
Financial Highlights
Six months ended April 30, 1998 and
each of the five years in the period ended October 31, 1997 13
NEW CENTURY CAPITAL AND I PORTFOLIOS
Notes to Financial Statements 14
- ------------------------------------------------------------------------------
<PAGE>
PRESIDENT'S LETTER
Dear Fellow Shareholders:
During the six-month period ended April 30, 1998, the U.S. economy remained
strong. Healthy corporate profits, low inflation, and low unemployment fostered
moderate economic growth.
The environment continued to fuel incredible performance by the U.S. equity
markets. Although the strength was concentrated in larger companies, other
sectors began to exhibit good performance. The Standard & Poor's 500 Composite
Stock Price Index, which reflects the performance of the stocks of the largest
domestic companies, gained 22.47% over this period. The Russell 2000 Index,
which reflects the performance of the stocks of smaller-capitalized domestic
companies, posted a gain of 11.85%. The international equity markets, measured
by the Morgan Stanley Capital International-Europe, Australasia, Far East Index,
gained 20.33%.
The U.S. fixed-income markets continued to balance expectations for
economic growth, inflation, and intervention by the Federal Reserve Board.
During the period, the Lehman Brothers Aggregate Bond Index gained 3.58%.
I am pleased to report that during the period, the New Century Portfolios
produced levels of investment return consistent with their fund's investment
objective. For the six-month period ended April 30, 1998, the New Century
Capital Fund produced a return of 15.90%; the New Century I Fund produced a
return of 11.58%. The three-year Beta was .88 for the Capital Fund and .59 for
the I Fund. (Beta measures the risk of a fund relative to the variability of an
index, in this case, the Standard & Poor's 500. A fund with a Beta less than 1.0
would be expected to decrease less than the index during a declining market and
to increase less than the index during a rising market.)
Sector allocation led the focus of our equity investments in the larger
capitalized companies by concentrating in the growth and the growth and income
sectors. Throughout the period, we increased our participation in the foreign
sector. Sector allocation also led us to concentrate our fixed-income
investments in the convertible and the high yield sectors.
As we look forward to the next six months, our investment goal is to
balance each fund's investment allocation among the strongest sectors and to
diversify our investment within each sector among the mutual funds that provide
superior risk-adjusted performance. We anticipate a continued increase in the
foreign sector, concentrating in Europe, and a continued emphasis on the large
cap value sector.
Sincerely,
Wayne M. Grzecki
President
Average Annual Total Return For The Period Ended 4/30/98
--------------------------------------------------------
1 Year 5 Years Since Inception (1/31/89)
------ ------- -------------------------
New Century Capital 37.23% 18.97% 14.35%
New Century I 26.93% 14.21% 11.70%
<PAGE>
NEW CENTURY CAPITAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
Issuer Shares Value
------ -----
INVESTMENT COMPANIES - 99.9%
Aggressive Funds - 3.5%
Oppenheimer Capital Appreciation 80,871 $3,240,513
----------
Growth and Income Funds - 38.4%
Goldman Sachs Growth & Income 213,102 6,141,587
MFS Massachusetts Investors 359,276 7,135,220
SEI Index S&P 500 Index 90,986 3,185,433
SEI Institutional Large Cap Valve A 218,556 4,449,792
T. Rowe Price Dividend Growth 257,072 5,622,161
Vanguard Index 500 92,346 9,533,836
----------
36,068,029
Growth Funds - 39.4%
Davis NY Venture 124,784 3,123,349
Janus130,839 3,825,734
Legg Mason Value Prime 138,946 7,148,793
Longleaf Partners 603 18,307
MFS Research 193,376 4,799,591
Neuberger & Berman Partners 64,569 1,882,175
Scudder Value 176,416 4,413,939
Sound Shore 59,166 1,883,834
T. Rowe Price Mid-Cap Growth 90,744 3,006,363
Vanguard Index Growth 137,662 3,627,383
Vanguard PrimeCap 73,613 3,262,533
----------
36,992,001
Small Company Funds - 14.3%
Eclipse Equity 250,665 4,035,704
Mutual Discovery Z 663 14,192
Nicholas II 90,933 3,825,540
Safeco Growth 84,387 2,327,393
State Street Research Aurora 145,390 3,211,658
----------
13,414,487
- ------------------------------------------------------------------------------
See notes to financial statements
-2-
<PAGE>
NEW CENTURY CAPITAL PORTFOLIO
PORTFOLIO OF INVESTMENTS - (Continued)
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
Issuer Shares Value
------ -----
Foreign Stock Funds - 4.3%
American Century International Growth 182,413 1,798,594
BT Investment International Equity 89,868 2,213,459
----------
4,012,053
Total investment companies
(Cost $77,695,528) 99.9% 93,727,083
Cash and other assets in excess of
liabilities 0.1% 103,300
------ -----------
Net assets 100.0% $93,830,383
====== ===========
Cost for federal income tax at April 30, 1998 was $77,695,528 and net
unrealized appreciation consisted of:
Gross unrealized appreciation $16,031,555
Gross unrealized depreciation -
-----------
Net unrealized appreciation $16,031,555
===========
- ------------------------------------------------------------------------------
See notes to financial statements
-3-
<PAGE>
NEW CENTURY CAPITAL PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
ASSETS
Investments, at value (Cost $77,695,528) (Note 1A) $93,727,083
Cash 196,005
Subscriptions receivable 31,249
----------
Total assets 93,954,337
----------
LIABILITIES
Payable for
Investment advisory fee 77,143
Capital stock redeemed 7,500
Accrued expenses 39,311
---------
Total liabilities 123,954
---------
NET ASSETS
(applicable to 6,112,366 outstanding shares;
unlimited number of shares of beneficial interest
authorized, $.01 par value. $93,830,383
===========
Net asset value, offering price and
redemption price per share ($93,830,383/6, 112,366
shares of beneficial interest outstanding) $15.35
======
Net assets consist of:
Paid-in capital $ 69,570,696
Unrealized appreciation of investments 16,031,555
Undistributed net realized gain on investments 8,305,855
Accumulated net investment deficit (77,723)
----------
Total net assets $93,830,383
===========
- ------------------------------------------------------------------------------
See notes to financial statements
-4-
<PAGE>
NEW CENTURY CAPITAL PORTFOLIO
STATEMENT OF OPERATIONS
Six months ended April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
NET INVESTMENT LOSS
Income
Interest $ 2,663
Dividends 509,373
----------
Total investment income 512,036
----------
Expenses
Distribution costs (Note 3) 74,622
Investment advisory fees (Note 2) 402,692
Transfer agent fees 15,569
Legal and audit fees 17,753
Custody and accounting fees 32,970
Administration fee (Note 2) 34,456
Trustees' fees 4,115
Other 7,582
----------
Total expenses 589,759
----------
Net investment loss (77,723)
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on investments 4,489,818
Capital gain distributions from
regulated investment companies 4,911,237
Net unrealized appreciation of
investments during the year 3,276,193
----------
Net realized and unrealized gain on investments 12,677,248
----------
Net increase in net assets resulting from operations $12,599,525
===========
- ------------------------------------------------------------------------------
See notes to financial statements
-5-
<PAGE>
NEW CENTURY CAPITAL PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
Six months Year ended
ended April 30, October 31,
1998 1997
------------- -----------
(Unaudited)
OPERATIONS
Net investment loss $ (77,723) $ (534,442)
Net realized gain on investments 4,489,818 3,495,771
Capital gain distributions from regulated
investment companies 4,911,237 4,265,671
Net unrealized appreciation (depreciation)
of investments 3,276,193 9,418,790
---------- ----------
Net increase in net assets resulting
from operations 12,599,525 16,645,790
DISTRIBUTIONS TO SHAREHOLDERS
Realized gains on investments
($1.46 and $2.03 per share, respectively) (7,850,147) (9,266,183)
CAPITAL SHARE TRANSACTIONS
Increase in net assets from capital
share transactions (a) 10,689,674 8,270,367
---------- ----------
TOTAL INCREASE IN NET ASSETS 15,439,052 15,649,974
NET ASSETS
Beginning of period 78,391,331 62,741,357
---------- ----------
End of period (including accumulated
net investment deficit of $(77,723)
and $-0-, respectively) $93,830,383 $78,391,331
=========== ===========
(a) Summary of capital share transactions is as follows:
Six months ended Year ended
April 30, 1998 (Unaudited) October 31, 1997
Share Value Share Value
----- ----- ----- -----
Shares sold 476,971 $ 6,960,124 426,511 $ 5,744,452
Shares issued on
reinvestment of
distributions 541,907 7,365,120 757,190 8,965,128
1,018,878 14,325,244 1,183,701 14,709,580
Shares redeemed (251,777) (3,635,570) (481,607) (6,439,213)
-------- ---------- -------- ----------
Net increase 767,101 $10,689,674 702,094 $8,270,367
======== =========== ======== ==========
- ------------------------------------------------------------------------------
See notes to financial statements
-6-
<PAGE>
NEW CENTURY CAPITAL PORTFOLIO
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------
(For a Share Outstanding Throughout each Period)
Six Months
Ended
April 30, Years ended October 31,
---------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
1998 1997 1996 1995 1994 1993
(Unaudited)
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning
of period 14.67 13.51 $13.12 $12.31 $12.74 $12.15
------ ------- ------ ------ ------ -------
Income (loss) from investment
operations
Net investment loss (0.01) (0.10) (0.09) (0.06) (0.08) (0.07)
Net gain on securities
(both realized
and unrealized) 2.15 3.29 1.90 2.16 0.64 2.39
---- ---- ---- ---- ----- ----
Total from investment
operations 2.14 3.19 1.81 2.10 0.56 2.32
---- ---- ---- ---- ----- ----
Less distributions
Distributions from
capital gains (1.46) (2.03) (1.42) (1.29) (0.99) (1.73)
----- ----- ----- ----- ----- -----
Net asset value, end of period $15.35 $14.67 $13.51 $13.12 $12.31 $12.74
====== ====== ====== ====== ====== ======
TOTAL RETURN** 15.90% 27.22 % 14.91 % 19.60 % 4.70 % 20.83 %
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year $93,830 $78,391 $62,741 $50,889 $37,968 $39,001
Ratio of expenses to
average net assets 1.41 % *1.43 % 1.47 % 1.61 % 1.60 % 1.54 %
Ratio of net investment loss to
average net assets -0.19 % *-0.76 % -0.69 % -0.52 % -0.68 % -0.53 %
Portfolio turnover 32 % 93 % 214 % 206 % 107 % 133 %
</TABLE>
* Annualized.
** Total return for a period of less than 1 year has not been annualized.
- ------------------------------------------------------------------------------
See notes to financial statements
-7-
<PAGE>
NEW CENTURY I PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
Issuer Shares Value
INVESTMENT COMPANIES - 99.9%
Equity Income Funds - 1.8%
Firstar Growth & Income Institutional 22,083 $1,025,995
----------
Growth and Income Funds - 30.4%
Goldman Sachs Growth & Income 61,611 1,775,622
Lexington Corporate Leaders 108,037 1,795,583
Lexington Growth & Income 104,665 2,404,157
MFS Massachusetts Investors 208,245 4,135,744
Mutual Shares Z 642 14,775
SEI Index S&P 500 Index 50,762 1,777,180
SEI Institutional Large Cap Value 44,126 898,414
Vanguard Index 500 42,356 4,372,866
----------
17,174,341
Growth Funds - 18.3%
Davis NY Venture 29,569 740,107
Legg Mason Value Prime 36,740 1,890,282
Longleaf Partners 603 18,293
MFS Research A 73,440 1,822,776
Scudder Value 56,052 1,402,432
Sound Shore 36,206 1,152,797
T. Rowe Price Mid-Cap Growth 28,739 952,126
Vanguard Index Growth 34,455 907,878
Vanguard PrimeCap 32,751 1,451,521
----------
10,338,212
Small Company Funds - 8.7%
Eclipse Equity 140,543 2,262,734
Mutual Discovery Z 66,095 1,414,438
Nicholas II 12,669 532,983
Safeco Growth 25,338 698,818
----------
4,908,973
Convertible Security Funds - 2.5%
MainStay Convertible 398 5,815
Pacific Horizon Capital 52,774 935,147
SBSF Convertible Securities 32,583 456,488
----------
1,397,450
General Corporate Bond Funds - 3.4%
Strong Corporate Bond 173,188 1,944,903
----------
- ------------------------------------------------------------------------------
See notes to financial statements
-8-
<PAGE>
NEW CENTURY I PORTFOLIO
PORTFOLIO OF INVESTMENTS - (Continued)
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
Issuer Shares Value
Government Treasury Bond Funds - 5.1%
American Century - Benham Target 2000 1,969 176,123
American Century - Benham Target 2005 10,190 700,289
American Century - Benham Target 2010 9,087 487,448
Federated U.S. Government -
1 to 3 Year Institutional 10,677 111,041
Vanguard Fixed Income Intermediate 132,318 1,411,827
2,886,728
High Quality Bond Funds - 4.4.%
Dodge & Cox Income 106,226 1,285,335
Scudder Income 80,786 1,089,802
Vanguard Fixed Income Long-Term Corporate Bond 11,262 103,159
----------
2,478,296
High Yield Bond Funds - 13.4%
MainStay High Yield 412,783 3,486,949
Nicholas Income 322,986 1,188,588
Northeast Investors 237,159 2,871,999
----------
7,547,536
Foreign Stock Funds - 4.3%
American Century International Growth 30,864 304,321
BT Investment International Equity 85,116 2,096,415
----------
2,400,736
Worldwide Bond Funds - 7.6%
PIMCO Foreign Bond Institutional 232,532 2,497,386
PIMCO Global Bond Institutional 181,243 1,776,179
----------
4,273,565
Total investment companies
(Cost $48,677,608) 99.9% 56,376,735
Cash and other assets in
excess of liabilities 0.1% 80,041
Net assets 100.0% $56,456,776
====== ===========
Cost for federal income tax at April 30, 1998
was $48,677,608 and net unrealized
appreciation consisted of:
Gross unrealized appreciation $7,762,375
Gross unrealized depreciation (63,248)
---------
Net unrealized appreciation $7,699,127
==========
- ------------------------------------------------------------------------------
See notes to financial statements
-9-
<PAGE>
NEW CENTURY I PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
ASSETS
Investments, at value
(Cost $48,677,608) (Note 1A) $56,376,735
Cash 87,406
Receivables for
Capital stock sold 6,000
Dividends and interest 39,274
Prepaid expenses 17,371
-----------
Total assets 56,526,786
-----------
LIABILITIES
Payable for
Investment advisory fee 46,314
Securities purchased 23,696
Total liabilities 70,010
NET ASSETS
(applicable to 4,178,452
outstanding shares; unlimited number
of shares of beneficial interest
authorized, $.01 par value. $56,456,776
===========
Net asset value, offering price and
redemption price per share
($56,456,776/4,178,452 shares
of beneficial interest outstanding) $13.51
======
Net assets consist of:
Paid-in capital $ 45,819,512
Unrealized appreciation of investments 7,699,127
Undistributed net realized gain on investments 2,861,267
Undistributed net investment income 76,870
----------
Total net assets $56,456,776
=============
- ------------------------------------------------------------------------------
See notes to financial statements
-10-
<PAGE>
NEW CENTURY I PORTFOLIO
STATEMENT OF OPERATIONS
Six months ended April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
NET INVESTMENT INCOME
Income
Interest $ 584
Dividends 965,473
---------
Total investment income 966,057
---------
Expenses
Distribution costs (Note 3) 35,328
Investment advisory fees (Note 2) 254,276
Transfer agent fees 12,182
Legal and audit fees 7,463
Custody and accounting fees 21,449
Registration and filing fees 2,715
Administration fee (Note 2) 15,917
Trustees' fees 1,885
Other 658
--------
Total expenses 351,873
--------
Net investment income 614,184
--------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on investments 1,320,152
Capital gain distributions from
regulated investment companies 2,060,605
Net unrealized appreciation of
investments during the year 1,757,632
---------
Net realized and unrealized gain on investments 5,138,389
---------
Net increase in net assets resulting
from operations $5,752,573
==========
- ------------------------------------------------------------------------------
See notes to financial statements
-11-
<PAGE>
NEW CENTURY I PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
Six months Year ended
ended April 30, October 31,
1998 1997
------------- ----------
(Unaudited)
OPERATIONS
Net investment income $ 614,184 $ 718,507
Net realized gain on investments 1,320,152 999,388
Capital gain distributions from regulated
investment companies 2,060,605 2,526,932
Net unrealized appreciation of investments 1,757,632 3,903,156
---------- ----------
Net increase in net assets
resulting from operations 5,752,573 8,147,983
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income
($0.15 and $0.21 per share, respectively) (537,314) (718,507)
Realized gains on investments
($1.03 and $0.99 per share, respectively) (3,790,005) (3,340,142)
CAPITAL SHARE TRANSACTIONS
Increase in net assets from capital
share transactions (a) 6,138,294 4,381,059
---------- ----------
TOTAL INCREASE IN NET ASSETS 7,563,548 8,470,393
NET ASSETS
Beginning of period 48,893,228 40,422,835
---------- ----------
End of period (including undistributed
net investment income of $76,870
and $-0-, respectively) $56,456,776 $48,893,228
=========== ===========
(a) Summary of capital share transactions is as follows:
Six months ended Year ended
April 30, 1998 (Unaudited) October 31, 1997
Share Value Share Value
----- ----- ----- ------
Shares sold 346,934 $ 4,531,425 446,249 $ 5,543,984
Shares issued on
reinvestment of
distributions 316,523 3,935,565 330,831 3,867,560
------- --------- ------- ---------
663,457 8,466,990 777,080 9,411,544
Shares redeemed (179,508) (2,328,696) (392,858) (5,030,485)
-------- ---------- -------- ----------
Net increase 483,949 $6,138,294 384,222 $4,381,059
======= ========== ======= ==========
- ------------------------------------------------------------------------------
See notes to financial statements
-12-
<PAGE>
NEW CENTURY I PORTFOLIO
FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------
(For a Share Outstanding Throughout each Period)
<TABLE>
<S> <C> <C>
Six Months
Ended
April 30, Years ended October 31,
(Unaudited)
-----------------------------------------------
1998 1997 1996 1995 1994 1993
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning o$ period $3.23 $12.21 $11.82 $11.22 $11.94 $11.36
----- ----- ------- ------ ------ ------
Income from investment operations
Net investment income (loss) 0.17 0.21 0.18 0.24 0.20 0.36
Net gain (loss) on securities
(both realized and unrealized) 1.29 2.01 1.30 1.28 (0.05) 1.61
---- ---- ---- ---- ----- -----
Total from investment operations 1.46 2.22 1.48 1.52 0.15 1.97
---- ---- ---- ---- ---- -----
Less distributions
Dividends from net investment income (0.15) (0.21) (0.18) (0.24) (0.19) (0.31)
Distributions from capital gains (1.03) (0.99) (0.91) (0.68) (0.68) (1.08)
Total distributions (1.18) (1.20) (1.09) (0.92) (0.87) (1.39)
----- ----- ----- ----- ----- -----
Net asset value, end of period $13.51 $13.23 $12.21 $11.82 $11.22 $11.94
====== ====== ====== ====== ====== ======
TOTAL RETURN** 11.85% 19.64 % 13.24 % 14.93 % 1.26 % 18.90 %
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year $56,457 $48,893 $40,423 $30,124 $23,803 $22,534
Ratio of expenses to
average net assets 1.38 % * 1.41 % 1.61 % 1.72 % 1.73 % 1.93 %
Ratio of net investment income to
average net assets 2.41 % * 1.58 % 1.45 % 2.14 % 1.57 % 2.11 %
Portfolio turnover 19 % 80 % 172 % 191 % 130 % 73 %
</TABLE>
* Annualized.
** Total return for a period of less than 1 year has not been annualized.
- --------------------------------------------------------------------------
See notes to financial statements
-13-
<PAGE>
WESTON PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
(1) SIGNIFICANT ACCOUNTING POLICIES
Weston Portfolios ("Weston") is organized as a Massachusetts business trust
which is registered under the Investment Company Act of 1940, as amended, as
an open-end diversified management investment company and currently offers
shares of two series: New Century Capital Portfolio and New Century I
Portfolio (together, "the Portfolios"). The investment objective of the New
Century Capital Portfolio is capital growth, with the secondary objective
being income while managing risk. This Portfolio seeks to achieve its
objective by concentrating in shares of registered investment companies
which emphasize investments in growth stocks. The investment objective of
New Century I Portfolio is income, with the secondary objective being growth
while managing risk. This Portfolio seeks to achieve its objective by
concentrating in shares of registered investment companies which emphasize
investments in fixed income securities, preferred stocks and high dividend
paying stocks. The price of shares of these Portfolios fluctuates daily and
there are no assurances that the Portfolios will be successful in achieving
their stated investment objectives. The following is a summary of
significant accounting policies consistently followed by the Portfolios in
the preparation of their financial statements.
A. INVESTMENT VALUATION
Investments, representing primarily capital stock of other open-end
investment companies, are valued at their net asset value as reported by
such companies. In the absence of readily available market quotations,
investments are valued at fair value as determined by the Board of
Trustees. Short-term investments are valued at amortized cost which
approximates market value.
B. 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
distribute substantially all of their taxable income to their
shareholders in a manner which results in no tax to the Portfolios.
Therefore, no federal income or excise tax provision is required.
C. INVESTMENT TRANSACTIONS
Investment transactions are recorded on a trade date basis. Realized
gains and losses from investment transactions are determined using the
first-in, first-out method.
D. INCOME RECOGNITION
Interest is accrued on portfolio investments daily. Dividend income is
recorded on the ex-dividend date.
E. COST OF OPERATIONS
The Portfolios bear all costs of their operations other than expenses
specifically assumed by the Advisor. Expenses directly attributable to a
Portfolio are charged to that Portfolio; other expenses are allocated
proportionately between each Portfolio in relation to the net assets of
each Portfolio.
- ------------------------------------------------------------------------------
-14-
<PAGE>
WESTON PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS - (Continued)
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
F. USE OF ESTIMATES
In preparing financial statements in accordance with generally accepted
accounting principles, management is required to make estimates and
assumptions that affect the reported amount of assets and liabilities and
the disclosure of contingent assets and liabilities at the date of the
financial statements, and revenues and expenses during the reporting
period. Actual results could differ from those estimates.
(2) INVESTMENT ADVISORY FEE, ADMINISTRATIVE AGREEMENT AND TRUSTEES' FEE
Fees paid by the Portfolios pursuant to a contract (the "Investment Advisory
Agreement") with Weston Financial Group, Inc. are computed daily and paid
monthly at an annualized rate of 1% on the first $100 million of average
daily assets and .75% of net assets exceeding that amount. The advisory fees
are based on the net assets of each of the Portfolios separately, and not on
the total net assets of the two series.
The Portfolios pay each Trustee who is not affiliated with Weston Financial
Group, Inc. $4,000 annually.
Fees paid by the Portfolio pursuant to a contract (the "Administration
Agreement") with Weston Financial Group, Inc. to administer the ordinary
course of the Portfolios' business are paid monthly from a detail of actual
expenses incurred in the overseeing of the Portfolios' affairs. All expenses
incurred overseeing the Portfolios' affairs are reimbursed monthly.
(3) DISTRIBUTION PLAN AND OTHER TRANSACTIONS WITH AFFILIATES
The Portfolios have adopted a Distribution Plan (the "Distribution Plan")
under Section 12(b) of the Investment Company Act of 1940 and Rule 12(b)-1
thereunder. Under the plan, each Portfolio may pay up to .25% of its average
daily net assets to Weston Securities Corp. (the "Distributor") for
activities primarily intended to result in the sale of shares. Under its
terms, the Plan shall remain in effect from year to year, provided such
continuance is approved annually by a vote of a majority of the Trustees and
a majority of those Trustees who are not "interested persons" of the
Portfolios and who have no direct or indirect financial interest in the
operation of the Plan or in any agreement related to the Plan (the
"Qualified Trustees").
During the six months ended April 30, 1998, Weston Securities Corp. received
sales commissions and other compensation of $18,858 and $7,186 in connection
with the purchase of investment company shares by New Century Capital
Portfolio and New Century I Portfolio, respectively. Weston Securities Corp.
has voluntarily agreed to waive payments made by each Portfolio pursuant to
the distribution plans in amounts equal to the sales commissions and other
compensation.
Certain officers and trustees are also officers and/or directors of Weston
Financial Group, Inc. and Weston Securities Corp.
- ------------------------------------------------------------------------------
-15-
<PAGE>
WESTON PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS - (Continued)
April 30, 1998 (Unaudited)
- ------------------------------------------------------------------------------
(4) INVESTMENT TRANSACTIONS
For the six months ended April 30, 1998, the cost of purchases and the
proceeds from sales of securities other than short-term notes were as
follows:
Purchases Sales
--------- -----
New Century Capital Portfolio $34,721,609 $27,004,109
New Century I Portfolio $14,131,772 $9,720,867
- ------------------------------------------------------------------------------
-16-
<PAGE>
This report and the financial statements contained herein are submitted for
the general information of the shareholders of the Portfolios. This report is
authorized for distribution to prospective investors in the Portfolios only if
preceded or accompanied by an effective Prospectus which contains details
concerning the management fee expense and other pertinent information.
