Lexington
Natural Resources Trust
Investment Adviser
LEXINGTON MANAGEMENT
CORPORATION
P.O.
Box 1515
Park
80 West Plaza Two
Saddle Brook, New Jersey 07663
Sub-Adviser
MARKET SYSTEMS RESEARCH ADVISORS,
INC.
80
Maiden Lane
New
York, New York 10038
Distributor
LEXINGTON FUNDS DISTRIBUTOR,
INC.
P.O.
Box 1515
Park
80 West Plaza Two
Saddle Brook, New Jersey 07663
www.lexingtonfunds.com
This
report has been prepared for the information of the contractholders of
Lexington Natural Resources Trust and is authorized for distribution to the
public only if it is accompanied or preceded by a currently effective
prospectus which sets forth expenses and other material
information.
LEX269-AR12/99
=============================
LEXINGTON
NATURAL
RESOURCES
TRUST
---------------------------
Investment Objective:
Long-term Growth of Capital
---------------------------
Annual Report
December 31, 1999
The Lexington Group
of No-Load
Investment Companies
=============================
[LOGO OF LEXINGTON]
Dear Contractholders:
The Lexington
Natural Resources Trust increased by 4.08%* during the fourth quarter and
increased by 14.09%* for the full year of 1999. According to Lipper, Inc.
the average natural resource fund increased by 2.17% for the fourth quarter
and increased by 30.68% for the full year of 1999.
Although,
Lexington Natural Resources Trust achieved a solid double digit investment
return, its performance was negatively impacted by investments in the paper
and forest products, environmental, chemical and natural gas sectors. These
sectors provided marginally positive returns in 1999, in comparison to the
oil and oil service sectors that responded positively to the strengthening
in the price of oil.
The Lexington
Natural Resources Trust had over 60% of its assets committed to the oil and
oil service sectors, but that proved too little when compared with other
funds in the natural resources category, which were concentrated in energy
stocks.
Outlook
The global
economic growth is projected to be in the 3.5% to 4.5% range. This will have
a strong impact on demand for commodity raw materials such as copper,
aluminum and nickel. In addition, “pricing power” is getting
better in the paper and forest products area where excess capacity has
shrunk over the past three years. Natural gas prices should rise later in
the year as inventories come down. It does not take much demand to drive
natural gas prices at this level of inventory.
We believe year
2000 will not only be good for the oil and oil service sectors, but global
growth will enhance the performance of other natural resource sectors. The
net result is that Lexington Natural Resources Trust has quality companies
that are poised for strong participation in the expanding global
economy.
We appreciate
the support of our contractholders and would be happy to respond to any
questions or comments you may have. Please feel free to call us at
1-800-367-9160 or visit our website at www.lexingtonfunds.com.
Sincerely,
|
/s/
Robert M. DeMichelle
Robert M. DeMichele
President and Portfolio Manager
February, 2000
|
|
/s/
Frank A. Peluso
Frank A. Peluso
Portfolio Manager
February, 2000
|
|
Comparison of change in value of a $10,000 Investment in
Lexington Natural Resources Trust and
the unmanaged Standard & Poor's 500 Stock Price Index
[LINE GRAPH]
-------------------------------------------------
Lexington
Date Natural Resources S&Ps500
-------------------------------------------------
12/31/89 $10,000 $10,000
12/31/90 $8,515 $9,690
12/31/91 $8,094 $12,636
12/31/92 $8,354 $13,597
12/31/93 $9,265 $14,965
12/31/94 $8,767 $15,161
12/31/95 $10,245 $20,851
12/31/96 $13,001 $25,641
12/31/97 $13,930 $34,197
12/31/98 $11,197 $44,019
12/31/99 $12,775 $53,280
-------------------------------------------------
-------------------------------------------------
Annualized Lexington
Return Natural Resources S&Ps500
-------------------------------------------------
1 YR 14.09% 21.04%
5 YR 7.82% 28.56%
10 YR 2.48% 18.21%
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Trust with a similar investment in the unmanaged Standard &
Poor's 500 Stock Price Index (S&P 500). Results for the Trust and the Standard &
Poor's 500 Stock Price Index include the reinvestment of all dividend and
capital gain distributions. Prior to October 14, 1991, the Trust operated under
a different investment objective. Investment return and principal value of an
investment will fluctuate so that an investor's shares when redeemed may be
worth more or less than at their original cost. Total return represents past
performance and it is not predictive of future results.
*
|
14.09%, 7.82% and 2.48%
are the one, five and since commencement (08/01/89) average annual
standard total returns, respectively, for the period ended December 31,
1999. Prior to September 1991, the Trust operated under a different name
and investment objective. Investment return and principal value of an
investment will fluctuate so that an investors shares, when redeemed, may
be worth more or less than their original cost. Total return represents
past performance and is not predictive of future results. There is no
guarantee that the Trust can achieve its objective.
|
[PIE CHART]
Lexington Natural Resources Trust
Portfolio Summary as of December 31, 1999
Asset Allocation
Common Stocks 92.8%
Cash & Cash Equivalents 7.2%
Top Sector Holdings
Energy Sources 60.1%
Paper & Forest Products 15.6%
Ferrous Metals 8.2%
Chemicals 4.9%
Basic Materials 4.0%
Lexington Natural Resources Trust
Statement of Net Assets
(Including the Portfolio of Investments)
December 31, 1999
Number of
Shares |
|
Security |
|
Value
(Note 1) |
|
| |
|
COMMON STOCKS:
92.8% |
|
|
| |
|
Basic Materials:
4.0% |
|
|
| 31,000 |
|
Martin Marietta Materials,
Inc. |
|
$1,271,000 |
|
|
|
|
|
| |
|
Chemicals: 4.9% |
|
|
| 6,000 |
|
Dow Chemical Company |
|
801,750 |
| 23,500 |
|
Geon Company |
|
763,750 |
|
|
|
|
|
| |
|
|
|
1,565,500 |
|
|
|
|
|
| |
|
Energy Sources:
60.1% |
|
|
| 20,000 |
|
Anadarko Petrol
Corporation |
|
682,500 |
| 20,000 |
|
Apache Corporation |
|
738,750 |
| 33,000 |
|
Avatar Holdings, Inc. |
|
587,813 |
| 15,000 |
|
BP Amoco plc |
|
889,687 |
| 20,000 |
|
Burlington Resources, Inc.
(ADR) |
|
661,250 |
| 7,500 |
|
Chevron Corporation |
|
649,687 |
| 6,000 |
|
Coastal Corporation |
|
212,625 |
| 23,000 |
|
Columbia Energy Group |
|
1,454,750 |
| 20,000 |
|
Diamond Offshore Drilling,
Inc. |
|
611,250 |
| 33,000 |
|
Enron Corporation |
|
1,464,375 |
| 15,100 |
|
Exxon Mobil Corporation |
|
1,216,494 |
| 25,000 |
|
Halliburton Company |
|
1,006,250 |
| 41,500 |
|
Noble Affiliates, Inc. |
|
889,656 |
| 12,000 |
|
Royal Dutch Petroleum Company—
NY Shares
1
|
|
725,250 |
| 22,500 |
|
Schlumberger, Ltd.-NY
Shares |
|
1,265,625 |
| 20,000 |
|
Texaco, Inc. |
|
1,086,250 |
| 17,000 |
|
The AES Corporation
1
|
|
1,270,750 |
| 19,000 |
|
The Williams Companies,
Inc. |
|
580,687 |
| 20,000 |
|
Total Fina S.A. (ADR) |
|
1,385,000 |
| 4,356 |
|
Transocean Sedco Forex,
Inc.
1
|
|
146,743 |
| 20,000 |
|
Unocal Corporation |
|
671,250 |
| 15,000 |
|
Valero Energy
Corporation |
|
298,125 |
| 10,000 |
|
Vastar Resources, Inc. |
|
590,000 |
|
|
|
|
|
| |
|
|
|
19,084,767 |
|
|
|
|
|
Number of
Shares or
Principal
Amount |
|
Security |
|
Value
(Note 1) |
|
| |
|
COMMON STOCKS
(continued): |
| |
|
Ferous Metals: 8.2
% |
|
|
| 15,700 |
|
Alcoa, Inc. |
|
$ 1,303,100 |
| 13,500 |
|
Rio Tinto plc |
|
1,279,125 |
|
|
|
|
|
| |
|
|
|
2,582,225 |
|
|
|
|
|
| |
|
Paper And Forest
Products: 15.6% |
|
|
| 23,200 |
|
Georgia Pacific
Corporation |
|
1,177,400 |
| 20,000 |
|
International Paper
Company |
|
1,128,750 |
| 20,500 |
|
The Mead Corporation |
|
890,469 |
| 13,400 |
|
Weyerhaeuser Company |
|
962,288 |
| 17,000 |
|
Willamette Industries,
Inc. |
|
789,438 |
|
|
|
|
|
| |
|
|
|
4,948,345 |
| |
|
|
|
|
| |
|
TOTAL COMMON
STOCKS |
|
|
| |
|
(cost $28,134,207) |
|
29,451,837 |
| |
|
|
|
|
| |
|
|
|
|
| |
|
SHORT-TERM INVESTMENT:
6.1% |
| |
|
U.S. Government Obligation:
6.1% |
|
|
| $2,000,000 |
|
U.S. Treasury Bills, 5.57%,
due 06/22/00
(cost $1,948,581) |
|
1,948,035 |
|
|
|
|
|
|
| |
|
TOTAL INVESTMENTS:
98.9% |
|
|
| |
|
(cost $30,082,788†)(Note
1) |
|
31,399,872 |
|
| |
|
Other assets in excess of
liabilities: 1.1% |
|
337,265 |
|
|
|
|
|
| |
|
TOTAL NET ASSETS:
100.0% |
|
|
| |
|
(equivalent to $12.51 per share
on 2,536,111 shares
outstanding) |
|
$31,737,137 |
| |
|
|
|
|
1
|
Non-income producing
security.
|
ADR
- American Depository Receipt.
†
|
Aggregate cost for Federal income
tax purposes is identical.
|
The Notes to Financial Statements are an integral part of this
statement.
3
Lexington Natural Resources Trust
Statement of Assets and Liabilities
December 31, 1999
| Assets |
| |
Investments, at value (cost
$30,082,788)
(Note 1) |
|
$31,399,872 |
|
| |
| Cash |
|
430,808 |
|
| |
| Receivable for fund shares
sold |
|
953 |
|
| |
| Dividends and interest
receivable |
|
14,987 |
|
| |
|
|
|
|
Total
Assets |
|
31,846,620 |
|
| |
|
|
|
| |
| Liabilities |
| |
Due to Lexington Management
Corporation (Note 2) |
|
26,150 |
|
| |
| Payable for fund shares
redeemed |
|
51,861 |
|
| |
| Accrued expenses |
|
31,472 |
|
| |
|
|
|
|
Total
Liabilities |
|
109,483 |
|
| |
|
|
|
Net Assets
(equivalent to $12.51 per share on
2,536,111 shares outstanding) (Note 3) |
|
$31,737,137 |
|
| |
|
|
|
| Net Assets consist
of: |
| |
| Additional
paid-in-capital |
|
$31,494,489 |
|
| |
| Undistributed net investment
income |
|
113,523 |
|
| |
Accumulated net realized loss on
investments
(Note 6) |
|
(1,187,959 |
) |
| |
| Unrealized appreciation of
investments |
|
1,317,084 |
|
| |
|
|
|
|
Total
Net Assets |
|
$31,737,137 |
|
| |
|
|
|
Lexington Natural Resources Trust
Statement of Operations
Year
ended December 31, 1999
| Investment
Income |
|
|
|
|
| |
|
Dividends |
|
$ 509,637 |
|
|
|
Interest |
|
64,618 |
|
|
| |
|
|
|
|
| |
|
574,255 |
|
|
| Less:
foreign tax expense |
|
10,228 |
|
|
| |
|
|
|
|
|
Total investment income |
|
|
|
$ 564,027 |
| |
| Expenses |
|
|
|
|
| |
| Investment
advisory fee (Note 2) |
|
338,700 |
|
|
|
Professional fees |
|
30,437 |
|
|
| Custodian
expenses |
|
5,014 |
|
|
| Transfer
agent |
|
1,552 |
|
|
| Printing
and mailing expenses |
|
5,380 |
|
|
| Directors
’ fees and expenses |
|
16,945 |
|
|
| Accounting
expenses (Note 2) |
|
29,990 |
|
|
|
Registration fees |
|
1,231 |
|
|
| Computer
processing fees |
|
11,475 |
|
|
| Other
expenses |
|
9,712 |
|
|
| |
|
|
|
|
|
Total expenses |
|
|
|
450,436 |
| |
|
|
|
|
|
Net investment income |
|
|
|
113,591 |
| |
Realized and Unrealized Gain on
Investments (Note 4) |
|
|
|
|
| |
| Net realized gain on
investments |
|
1,242,484 |
|
|
Net change in unrealized
appreciation
of investments |
|
2,883,412 |
|
|
| |
|
|
|
|
| Net realized and unrealized
gain |
|
|
|
4,125,896 |
| |
|
|
|
|
Increase in Net Assets Resulting
from Operations |
|
|
|
$4,239,487 |
| |
|
|
|
|
The Notes to Financial Statements are an integral part of
these statements.
4
Lexington Natural Resources Trust
Statement of Changes in Net Assets
Years
ended December 31, 1999 and 1998
| |
|
1999
|
|
1998
|
| Operations: |
|
|
|
|
|
|
| Net investment income |
|
$
113,591 |
|
|
$
201,733 |
|
| Net realized gain (loss) from
investments |
|
1,242,484 |
|
|
(2,286,879 |
) |
| Net change in unrealized
appreciation (depreciation) of investments |
|
2,883,412 |
|
|
(8,067,438 |
) |
| |
|
|
|
|
|
|
|
Net increase (decrease) in net assets
resulting from operations |
|
4,239,487 |
|
|
(10,152,584 |
) |
| |
|
|
|
|
|
|
| |
|
| Distributions to Shareholders:
(Note 1) |
|
|
|
|
|
|
| Distributions to shareholders
from net investment income |
|
(201,233 |
) |
|
(246,500 |
) |
Distributions to shareholders
from net realized gains from security
transactions |
|
— |
|
|
(2,842,852 |
) |
| |
|
|
|
|
|
|
|
Decrease in net assets from distributions |
|
(201,233 |
) |
|
(3,089,352 |
) |
| |
|
|
|
|
|
|
| |
|
| Capital Share Transactions:
(Note 3) |
|
|
|
|
|
|
| Proceeds from sale of
shares |
|
11,201,809 |
|
|
8,218,783 |
|
| Reinvested dividends |
|
201,233 |
|
|
3,089,351 |
|
| Cost of shares
redeemed |
|
(19,122,133 |
) |
|
(27,911,086 |
) |
| |
|
|
|
|
|
|
|
Net decrease in net assets from capital share
transactions |
|
(7,719,091 |
) |
|
(16,602,952 |
) |
| |
|
|
|
|
|
|
| Net decrease in net
assets |
|
(3,680,837 |
) |
|
(29,844,888 |
) |
| |
|
| Net Assets: |
|
|
|
|
|
|
| Beginning of period |
|
35,417,974 |
|
|
65,262,862 |
|
| |
|
|
|
|
|
|
End of period (including
undistributed net investment income of
$113,523 and $201,165 in 1999 and 1998,
respectively) |
|
$31,737,137 |
|
|
$35,417,974 |
|
| |
|
|
|
|
|
|
The Notes to Financial Statements are an integral part of
these statements.
Lexington Natural Resources
Trust
Notes to Financial Statements
December 31, 1999 and 1998
1. Significant Accounting Policies
Lexington Natural Resources Trust (the “Trust”) is
an open-end non-diversified management investment company registered
under the Investment Company Act of 1940, as amended. The Trust’s
investment objective is to seek long-term growth of capital through
investment primarily in common stock of companies which own, or develop
natural resources and other basic commodities, or supply goods and
services to such companies. With the exception of shares held in
connection with initial capital of the Trust, shares of the Trust are
currently being offered only to participating insurance companies for
allocation to certain of their separate accounts established for the
purpose of funding variable annuity contracts and variable life insurance
policies issued by the participating insurance companies. The following
is a summary of significant accounting policies followed by the Trust in
the preparation of its financial statements:
5
Lexington Natural Resources Trust
Notes to Financial Statements
December 31, 1999 and 1998 (continued)
1. Significant Accounting Policies (continued)
Investments Securities transactions
are accounted for on a trade date basis. Realized gains and losses from
investment transactions are reported on the identified cost basis.
Securities traded on a recognized stock exchange are valued at the last
sales price reported by the exchange on which the securities are traded.
If no sales price is recorded, the mean between the last bid and asked
prices is used. Securities traded on the over-the-counter market are
valued at the mean between the last current bid and asked prices.
Short-term securities having a maturity of 60 days or less are stated at
amortized cost, which approximates market value. Securities for which
market quotations are not readily available and other assets are valued
by management in good faith under the direction of the Trust’s Board
of Trustees. Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Interest income, adjusted for
amortization of premiums and accretion of discounts, is accrued as
earned.
Federal Income Taxes It is the Trust
’s policy to comply with the requirements of the Internal Revenue
Code applicable to “regulated investment companies” and to
distribute all of its taxable income to its shareholders. Therefore, no
provision for Federal income taxes is required.
Distributions Dividends from net
investment income and net realized capital gains are normally declared
and paid annually, but the Trust may make distributions on a more
frequent basis to comply with the distribution requirements of the
Internal Revenue Code. The character of income and gains to be
distributed are determined in accordance with income tax regulations
which may differ from generally accepted accounting principles. At
December 31, 1999, reclassifications were made to the Trust’s
capital accounts to reflect permanent book/tax differences and income and
gains available for distributions under income tax regulations. Net
investment income, net realized gains and net assets were not affected by
this change.
Use
of Estimates The preparation of financial
statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the
reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those
estimates.
2. Investment Advisory Fee and Other Transactions with
Affiliate
The Trust pays an investment advisory fee to Lexington
Management Corporation (“LMC”) at an annual rate of 1.00% of
the Trust’s average daily net assets. LMC has entered into a
sub-advisory management contract with Market Systems Research Advisors,
Inc. (“MSR”), a registered investment advisor, under which MSR
will provide the Trust with certain investment management and
administrative services. Pursuant to the terms of the sub-advisory
contract between LMC and MSR, LMC pays MSR a monthly sub-advisory fee of
0.50% of the Trust’s average daily net assets. For 1999, the
investment advisor has voluntarily agreed to reimburse the Trust if total
annual expenses (including management fees, but excluding interest,
taxes, brokerage commission and extraordinary expenses) exceed 2.50% of
the Trust’s average net assets. No reimbursement was required for
the year ended December 31, 1999.
The Trust also reimburses LMC for certain expenses, including
accounting costs of $29,990, which are incurred by the Trust, but paid by
LMC.
Lexington Natural Resources Trust
Notes to Financial Statements
December 31, 1999 and 1998 (continued)
3. Capital Stock
Transactions in capital stock were as follows:
| |
|
Year ended |
| |
|
December 31, 1999
|
|
December 31, 1998
|
| |
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
| Shares sold |
|
902,368 |
|
|
$11,201,809 |
|
|
588,215 |
|
|
$ 8,218,783 |
|
| Shares issued on reinvestment
of dividends |
|
15,895 |
|
|
201,233 |
|
|
274,122 |
|
|
3,089,351 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
918,263 |
|
|
11,403,042 |
|
|
862,337 |
|
|
11,308,134 |
|
| Shares redeemed |
|
(1,593,749 |
) |
|
(19,122,133 |
) |
|
(2,026,593 |
) |
|
(27,911,086 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net decrease |
|
(675,486 |
) |
|
$ (7,719,091 |
) |
|
(1,164,256 |
) |
|
$(16,602,952 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
4. Investment Transactions
The cost of purchases and proceeds from sales of investments
for the year ended December 31, 1999, excluding short-term securities,
were $14,556,647 and $24,532,732, respectively.
At
December 31, 1999, the aggregate gross unrealized appreciation for all
securities in which there is an excess of value over tax cost amounted to
$3,535,039 and aggregate gross unrealized depreciation for all securities
in which there is an excess of tax cost over value amounted to
$2,217,955.
5. Investment and Concentration Risks
The Trust makes significant investments in foreign securities
and has a policy of investing in the securities of companies that own or
develop natural resources and other basic commodities, or supply goods
and services to such companies. There are certain risks involved in
investing in foreign securities or concentrating in specific industries
such as natural resources that are in addition to the usual risks
inherent in domestic investments. These risks include those resulting
from future adverse political and economic developments, as well as the
possible imposition of foreign exchange or other foreign governmental
restrictions or laws, all of which could affect the market and/or credit
risk of the investments.
6. Federal Income Taxes-Capital Loss
Carryforwards
Capital loss carryforwards available for Federal income tax
purposes as of December 31, 1999 are $1,187,960 expiring in
2006.
To
the extent any future capital gains are offset by these losses, such
gains may not be distributed to contractholders.
7. Tax Information (unaudited)
The following tax information represents the designation of
various tax benefits relating to the year ended December 31,
1999:
The percentage of investment company taxable income eligible
for the dividends received deduction available to certain corporate
shareholders with respect to the fiscal year ended December 31, 1999 is
100%.
The percentage of ordinary income distributions paid by the
Trust derived from agency and direct obligations of the United States
government were as follows:
| U.S. Treasury |
|
11.48% |
| Federal Home Loan
Bank |
|
9.14 |
Lexington Natural Resources Trust
Financial Highlights
Selected per share data for a share outstanding throughout the
period:
| |
|
Year ended December
31,
|
| |
|
1999
|
|
1998
|
|
1997
|
|
1996
|
|
1995
|
| Net asset value, beginning of
period |
|
$11.03 |
|
|
$14.91 |
|
|
$14.29 |
|
|
$11.30 |
|
|
$ 9.71 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income (loss) from investment
operations: |
|
Net investment income |
|
0.06 |
|
|
0.08 |
|
|
0.06 |
|
|
0.05 |
|
|
0.06 |
|
Net realized and unrealized gain (loss) on
investments |
|
1.50 |
|
|
(2.98 |
) |
|
1.00 |
|
|
2.99 |
|
|
1.58 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total income (loss) from
investment
operations |
|
1.56 |
|
|
(2.90 |
) |
|
1.06 |
|
|
3.04 |
|
|
1.64 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Less distributions: |
|
Dividends from net investment income |
|
(0.08 |
) |
|
(0.08 |
) |
|
— |
|
|
(0.05 |
) |
|
(0.05 |
) |
|
Distributions from net realized gains |
|
— |
|
|
(0.90 |
) |
|
(0.44 |
) |
|
— |
|
|
— |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total distributions |
|
(0.08 |
) |
|
(0.98 |
) |
|
(0.44 |
) |
|
(0.05 |
) |
|
(0.05 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net asset value, end of
period |
|
$12.51 |
|
|
$11.03 |
|
|
$14.91 |
|
|
$14.29 |
|
|
$11.30 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| Total return |
|
14.09% |
|
|
(19.62)% |
|
|
7.15% |
|
|
26.89% |
|
|
16.87% |
|
| |
|
| Ratio to average net
assets: |
|
Expenses |
|
1.33% |
|
|
1.29% |
|
|
1.25% |
|
|
1.42% |
|
|
1.47% |
|
|
Net investment income |
|
0.34% |
|
|
0.42% |
|
|
0.39% |
|
|
0.40% |
|
|
0.56% |
|
| Portfolio turnover
rate |
|
41.94% |
|
|
74.36% |
|
|
114.16% |
|
|
102.76% |
|
|
149.18% |
|
| Net assets, end of period (000
’s omitted) |
|
$31,737 |
|
|
$35,418 |
|
|
$65,263 |
|
|
$37,934 |
|
|
$16,955 |
|
Independent Auditors’ Report
The Board of Trustees and Shareholders
Lexington Natural Resources Trust:
We
have audited the accompanying statement of net assets (including the
portfolio of investments) and assets and liabilities of Lexington
Natural Resources Trust as of December 31, 1999, the related statement
of operations for the year then ended, the statements of changes in net
assets for each of the years in the two-year period then ended, and the
financial highlights for each of the years in the five-year period 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 audits.
We
conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements and financial highlights.
Our procedures included confirmation of securities owned as of December
31, 1999 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In
our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial
position of Lexington Natural Resources Trust as of December 31, 1999,
the results of its operations for the year then ended, the changes in
its net assets for each of the years in the two-year period then ended,
and its financial highlights for each of the years in the five-year
period then ended, in conformity with generally accepted accounting
principles.
New York, New York
February 7, 2000
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