CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
A Portfolios of CMC Fund Trust
SEMI-ANNUAL REPORT
(Unaudited )
April 30, 1998
1300 S.W. Sixth, P.O. Box 1350, Portland, OR 97207
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CMC Fund Trust
FINANCIAL HIGHLIGHTS
For a Share Outstanding Throughout the Period
- -----------------------------------------------------------------------------------------------------------------------------------
CMC SMALL CAP FUND
Six Months
Ended Fiscal Year Ended October 31,
April 30, 1998 ----------- ----------- ----------- ----------- -----------
(Unaudited) (1) 1997 1996 1995 1994 1993
-------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period............ $ 54.40 $ 52.04 $ 56.00 $ 49.35 $ 56.44 $ 50.68
----------- ----------- ----------- ----------- ----------- -----------
Income from investment operations:
Net investment income (loss)............... (0.07) (0.04) (0.08) 0.22 0.18 0.10
Net realized and unrealized gains on
investments.............................. 5.39 14.08 16.79 10.88 1.99 15.50
----------- ----------- ----------- ----------- ----------- -----------
Total from investment operations...... 5.32 14.04 16.71 11.10 2.17 15.60
----------- ----------- ----------- ----------- ----------- -----------
Less distributions:
Dividends (from net investment income).... (0.16) (0.17) (0.10)
Dividends (in excess of net
investment income).................... (0.01)
Distributions (from capital gains)........ (11.68) (20.67) (4.25) (8.99) (9.74)
Distributions (in excess of capital gains) (0.04) (0.09)
----------- ----------- ----------- ----------- ----------- -----------
Total distributions................... - (11.68) (20.67) (4.45) (9.26) (9.84)
----------- ----------- ----------- ----------- ----------- -----------
Net asset value, end of period.................. $ 59.72 $ 54.40 $ 52.04 $ 56.00 $ 49.35 $ 56.44
=========== =========== =========== =========== =========== ===========
Total return ................................... 9.78% (2) 26.98% 30.30% 22.55% 3.87% 30.87%
Ratios/Supplemental data
Net assets, end of period (in thousands)........ $ 374,829 $ 521,770 $ 522,408 $ 537,167 $ 467,952 $ 492,905
Ratio of expenses to average net assets......... 0.76% 0.76% 0.78% 0.77% 0.78% 0.79%
Ratio of net investment income (loss) to
average net assets........................... (0.22)% (0.08)% (0.14)% 0.43% 0.29% 0.17%
Portfolio turnover rate......................... 127.77% 168.72% 147.77% 125.80% 97.24% 64.39%
Average commission rate paid on
portfolio transactions (3) .................. $ 0.0566 $ 0.0563 $ 0.0539
(1) Ratio and portfolio turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
total dollar amount of commissions paid during the period by the total
number of shares purchased and sold during the period for which commissions
were charged.
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1
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CMC Fund Trust
FINANCIAL HIGHLIGHTS
For a Share Outstanding Throughout the Period
- ---------------------------------------------------------------------------------------------------------------------------
CMC INTERNATIONAL STOCK FUND
Six Months
Ended Fiscal Year Ended October 31,
April 30, 1998 ------------ ------------ ------------ ------------
(Unaudited) (1) 1997 1996 1995 1994 (1)(2)
----------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period............$ 42.71 $ 42.46 $ 37.06 $ 39.51 $ 40.00
----------- ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income...................... 0.05 0.41 0.32 0.39 0.10
Net realized and unrealized gains (losses)
on investments and foreign currency
transactions............................. 5.44 6.16 5.86 (2.64) (0.59)
----------- ------------ ------------ ------------ ------------
Total from investment operations...... 5.49 6.57 6.18 (2.25) (0.49)
----------- ------------ ------------ ------------ ------------
Less distributions:
Dividends (from net investment income)..... (0.46) (0.78) (0.19)
Dividends (in excess of net
investment income)....................... (0.01)
Distributions (from capital gains)........ (5.86)
----------- ------------ ------------ ------------ ------------
Total distributions................... - (6.32) (0.78) (0.20) -
----------- ------------ ------------ ------------ ------------
Net asset value, end of period..................$ 48.20 $ 42.71 $ 42.46 $ 37.06 $ 39.51
=========== ============ ============ ============ ============
Total return.................................... 12.85% (3) 15.47% 16.67% -5.69% -1.23% (3)
Ratios/Supplemental data
Net assets, end of period (in thousands)........$ 70,539 $ 81,471 $ 73,542 $ 68,758 $ 84,298
Ratio of expenses to average net assets......... 1.02% 1.05% 1.00% 0.98% 1.16%
Ratio of net investment income to
average net assets........................... 0.23% 0.88% 0.78% 0.99% 0.53%
Portfolio turnover rate......................... 43.54% 126.56% 119.98% 158.32% 123.80%
Average commission rate paid on
portfolio transactions (4) ..................$ 0.0186 $ 0.0050 $ 0.0012
(1) Ratios and portfolio turnover rates are annualized.
(2) From inception of operations on February 1, 1994.
(3) Not annualized.
(4) The average commission rate paid by the fund is computed by dividing the
total dollar amount of commissions paid during the period by the total
number of shares purchased and sold during the period for which commissions
were charged.
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2
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CMC SMALL CAP FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
APRIL 30, 1998
(UNAUDITED)
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
COMMON STOCKS (91.4%)
BUILDING & FORESTRY PRODUCTS (3.0%)
MARTIN MARIETTA MATERIALS, INC. 150,000 $ 7,040,625
SOUTHDOWN, INC. 60,000 4,245,000
--------------
11,285,625
--------------
BUSINESS & CONSUMER SERVICES (7.4%)
* ACCUSTAFF, INC. 44,600 1,600,025
DOLLAR THRIFTY AUTOMOTIVE GROUP, INC. 194,000 3,661,750
* FAMILY GOLF CENTERS, INC. 142,400 5,998,600
PMT SERVICES, INC. 240,000 4,680,000
PROFIT RECOVERY GROUP INTERNATIONAL, THE 170,000 4,420,000
SELECT APPOINTMENTS HOLDINGS PLC ADR 190,000 5,153,750
* WALSH INTERNATIONAL, INC. 151,800 2,248,538
--------------
27,762,663
--------------
CONSUMER DURABLE (5.1%)
CHAMPION ENTERPRISES, INC. 116,100 2,887,988
HON INDUSTRIES, INC. 60,000 1,920,000
KNOLL, INC. 50,000 1,740,625
MILLER (HERMAN), INC. 130,000 3,924,375
* TOWER AUTOMOTIVE, INC. 100,000 5,331,250
WATSCO, INC. 114,000 3,334,500
--------------
19,138,738
--------------
CONSUMER NON-DURABLE (9.5%)
* BED, BATH & BEYOND, INC. 46,800 2,304,900
CAVANAUGHS HOSPITALITY CORP. 51,000 800,062
CIRCUIT CITY STORES, INC. 65,000 2,640,625
CKE RESTAURANTS, INC. 173,830 6,018,864
COLUMBIA SPORTSWEAR CO. 40,000 850,000
* COST PLUS, INC. 181,000 5,859,875
CSK AUTO CORP. 115,000 3,105,000
GIBSON GREETINGS, INC. 147,000 3,844,969
MAXWELL SHOE COMPANY, INC. 125,000 2,218,750
OMEGA PROTEIN CORP. 41,600 728,000
* WILLIAMS-SONOMA, INC. 130,200 7,152,863
--------------
35,523,908
--------------
ENERGY (2.5%)
MERIDIAN RESOURCE CORP. 346,788 3,142,766
* OCEAN ENERGY, INC. 107,750 2,639,875
PATTERSON ENERGY, INC. 48,800 683,200
* SWIFT ENERGY CO. 150,000 2,990,625
--------------
9,456,466
--------------
3
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CMC SMALL CAP FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
COMMON STOCKS (CONTINUED)
ENERGY SERVICES (3.5%)
* HANOVER COMPRESSOR CO. 98,000 $ 2,535,750
* NOBLE DRILLING CORP. 175,000 5,654,688
* TUBOS DE ACERO DE MEXICO SA ADR 135,000 2,480,625
* WILLBROS GROUP, INC. 149,000 2,477,125
--------------
13,148,188
--------------
FINANCE (4.6%)
* INSIGNIA FINANCIAL GROUP, INC. (CLASS A) 276,500 7,361,813
NORTH FORK BANCORP, INC. 120,700 4,480,987
STIRLING COOKE BROWN HOLDINGS, LTD. 98,000 2,768,500
TCF FINANCIAL CORP. 84,200 2,741,762
--------------
17,353,062
--------------
HEALTH (19.7%)
* AMERICAN ONCOLOGY RESOURCES, INC. 225,200 3,378,000
* ASSISTED LIVING CONCEPTS, INC. 205,800 3,781,575
BARR LABORATORIES, INC. 200,000 8,112,500
* CARDIAC PATHWAYS CORP. 222,000 2,109,000
* CONCENTRA MANAGED CARE, INC. 97,500 3,034,687
* ESC MEDICAL SYSTEMS LTD. 261,150 8,487,375
* FPA MEDICAL MANAGEMENT, INC. 158,700 1,983,750
* HEALTH MANAGEMENT SYSTEMS, INC. 200,000 2,125,000
* INDEXX LABORATORIES, INC. 150,000 3,318,750
INTELLIGENT POLYMERS LTD. (UNITS - EACH UNIT
CONSISTS OF 1 COMMON SHARE & 1 WARRANT) 144,000 3,654,000
JONES MEDICAL INDUSRIES, INC. 216,000 6,372,000
* LIGAND PHARMACEUTICALS, INC. (CLASS B) 385,100 5,583,950
* QUORUM HEALTH GROUP, INC. 120,000 3,855,000
SPIROS DEVELOPMENT CORP. II (UNITS - 1
CALLABLE COMMON SHARE OF SPIOS & 1
WARRANT OF DURABLE PHARMACEUTICALS) 138,000 2,294,250
* THERMEDICS, INC. 415,100 6,667,544
* TRANSKARYOTIC THERAPIES, INC. 144,600 4,500,675
* WATSON PHARMACEUTICALS, INC. 103,000 4,429,000
--------------
73,687,056
--------------
MACHINERY & CAPITAL SPENDING (0.6%)
* TRINITY INDUSTRIES, INC. 46,100 2,351,100
--------------
MEDIA & ENTERTAINMENT (1.8%)
* GOLDEN BOOKS FAMILY ENTERTAINMENT, INC. 136,700 1,546,419
MIDWAY GAMES, INC. 180,162 3,332,997
* WMS INDUSTRIES, INC. 367,500 1,883,437
--------------
6,762,853
--------------
4
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CMC SMALL CAP FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
COMMON STOCKS (CONTINUED)
METAL MINING & STEEL (2.3%)
* MERIDIAN GOLD, INC. 331,800 $ 1,306,463
OREGON STEEL MILLS, INC. 302,500 7,184,375
--------------
8,490,838
--------------
POLLUTION CONTROL (1.8%)
* ALLIED WASTE INDUSTRIES, INC. 239,000 6,572,500
--------------
TECHNOLOGY (26.3%)
* ACTEL CORP. 170,000 2,528,750
* ACXIOM CORP. 66,500 1,612,625
ALTERA CORP. 100,000 4,050,000
AMERICAN MANAGEMENT SYSTEMS, INC. 200,000 5,787,500
ASCEND COMMUNICATIONS, INC. 180,000 7,841,250
* AXENT TECHNOLOGIES, INC. 108,700 2,853,375
CERNER CORP. 304,500 9,077,906
* COMPUTER PRODUCTS, INC. 66,300 1,458,600
DAVOX CORP. 41,700 933,038
* ENGINEERING ANIMATION, INC. 112,500 5,301,562
* HNC SOFTWARE, INC. 140,000 5,460,000
* HYPERION SOFTWARE CORP. 121,400 5,265,725
* MICROS SYSTEMS, INC. 116,600 6,864,825
NETWORK APPLIANCE, INC. 100,000 3,606,250
OBJECTIVE SYSTEMS INTEGRATORS, INC. 300,000 3,337,500
P-COM, INC. 295,200 5,811,750
PAIRGAIN TECHNOLOGIES, INC. 150,000 2,765,625
* PLATINUM SOFTWARE CORP. 257,600 5,763,800
PREMISYS COMMUNICATIONS, INC. 70,000 2,043,125
* RADISYS CORP. 55,000 1,498,750
* SECURITY DYNAMICS TECHNOLOGIES, INC. 67,200 1,621,200
SYNOPSYS, INC. 125,000 5,375,000
* TRANSITION SYSTEMS, INC. 235,300 5,294,250
XILINX, INC. 50,000 2,287,500
--------------
98,439,906
--------------
UTILITIES/COMMUNICATIONS (3.3%)
* ANICOM, INC. 350,300 5,473,437
COMSTAT CORP. 100,000 4,037,500
* INTERMEDIA COMMUNICATIONS, INC. 31,000 2,262,515
XIRCOM, INC. 44,300 755,869
--------------
12,529,321
--------------
TOTAL COMMON STOCKS
(COST $284,056,315) 342,502,224
--------------
5
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CMC SMALL CAP FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
REPURCHASE AGREEMENTS (9.9%)
GOLDMAN SACHS CORP.
5.414% DATED 04/30/1998,
DUE 05/01/1998 IN THE
AMOUNT OF $18,758,013
COLLATERALIZED BY U.S. TREASURY NOTES
6.125% TO 6.500% DUE
10/15/2006 TO 08/15/2007. $ 18,755,231 $ 18,755,231
J.P. MORGAN SECURITIES, INC.
5.424% DATED 04/30/1998,
05/01/1998 IN THE
AMOUNT OF $18,502,749
COLLATERALIZED BY U.S. TREASURY NOTES
6.500% TO 7.875% DUE
05/31/2001 TO 08/15/2001. 18,500,000 18,500,000
--------------
TOTAL REPURCHASE AGREEMENTS
(COST $37,255,231) 37,255,231
--------------
TOTAL INVESTMENTS (101.3%)
(COST $321,311,546) 379,757,455
RECEIVABLES LESS LIABILITIES (-1.3%) (4,928,909)
--------------
NET ASSETS (100.0%) $ 374,828,546
==============
(1) See Note 1 of Notes to Financial Statements.
* Non-Income Producing
The accompanying notes are an integral part of the financial statements.
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6
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CMC INTERNATIONAL STOCK FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
APRIL 30, 1998
(UNAUDITED)
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
COMMON STOCKS (88.7%)
BELGIUM (0.5%)
* LERNOUT & HAUSPIE SPEECH PRODUCTS NV
(BUSINESS SERVICES) 6,000 $ 382,500
--------------
BRAZIL (0.4%)
CIA TECIDOS DO NORTE DE MINAS SA (TEXTILES) 1,100,000 283,679
--------------
CANADA (3.1%)
BANK OF MONTREAL (BANKING) 3,000 163,625
BOMBARDIER, INC. (CLASS B) (MANUFACTURING -
DIVERSIFIED INDS.) 9,500 256,416
CANADIAN NATIONAL RAILWAY CO. (TRANSPORTATION) 5,000 325,327
CANWEST GLOBAL COMMUNICATIONS CORP. (MEDIA) 4,900 91,826
* NEWBRIDGE NETWORKS CORP. (ELECTRONICS) 10,000 292,986
NORTHERN TELECOM LTD. (ELECTRONICS) 11,000 669,568
* POCO PETROLEUMS LTD. (OIL EXPLORATION & PRODUCTION) 18,400 209,720
ROYAL BANK OF CANADA (BANKING) 3,500 209,006
--------------
2,218,474
--------------
CHILE (0.6%)
* DISTRIBUCION Y SERVICIO D&S SA, ADR (RETAIL) 22,400 394,800
--------------
FINLAND (1.9%)
FINNLINES OYJ (TRANSPORTATION) 7,500 399,339
MERITA PLC (CLASS A) (BANKING) 120,000 804,186
YIT-YHTYMA OYJ (CONSTRUCTION) 10,700 157,165
--------------
1,360,690
--------------
FRANCE (7.7%)
ALCATEL ALSTHOM SA (ELECTRONICS) 2,400 444,962
BANQUE NATIONAL DE PARIS (BANKING) 1,000 84,303
CIE DE SAINT GOBAIN SA (BUILDING MATERIALS) 1,747 291,070
CIE FINANCIERE DE PARIBAS (CLASS A) (BANKING) 1,500 159,628
ELF-AQUITAINE SA (OIL EXPLORATION & PRODUCTION) 3,500 459,179
* FRANCE TELECOM SA, ADR (UTILITIES - COMMUNICATION) 13,200 721,050
L'OREAL SA (CONSUMER PRODUCTS) 1,800 858,996
* RENAULT SA (MOTOR VEHICLES & PARTS) 20,800 964,948
SCHNEIDER SA (ELECTRICAL EQUIPMENT) 5,600 419,022
SODEXHO ALLIANCE SA (FOOD & BEVERAGES) 4,000 732,291
SYNTHELABO SA (PHARMACEUTICALS) 2,200 331,061
--------------
5,466,510
--------------
GERMANY (6.2%)
ALLIANZ AG (INSURANCE) 1,029 316,534
DEUTSCHE BANK AG (BANKING) 8,500 654,320
MANNESMANN AG (MACHINERY & CAPITAL SPENDING) 2,370 1,881,204
RWE AG (MANUFACTURING - DIVERSIFIED INDS.) 4,500 229,013
THYSSEN AG (METALS, MINING & STEEL) 2,000 457,302
VOLKSWAGEN AG (MOTOR VEHICLES & PARTS) 1,023 814,865
--------------
4,353,238
--------------
7
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CMC INTERNATIONAL STOCK FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
COMMON STOCKS (CONTINUED)
INDIA (2.9%)
BAJAJ AUTO LTD., GDR (MOTOR VEHICLES & PARTS) 18,000 $ 340,200
BANK OF BARODA LTD. (BANKING) 174,000 510,733
INDUSTRIAL CREDIT & INVESTMENT CORP. OF INDIA LTD.,
GDR, THE (FINANCIAL SERVICES) 21,600 351,000
INFOSYS TECHNOLOGIES LTD. (BUSINESS SERVICES) 9,800 535,803
MAHINDRA & MAHINDRA LTD. (MOTOR VEHICLES & PARTS) 45,000 328,571
--------------
2,066,307
--------------
IRELAND (0.8%)
BANK OF IRELAND PLC (BANKING) 14,000 284,790
IRISH LIFE PLC (INSURANCE) 29,500 273,420
--------------
558,210
--------------
ITALY (3.7%)
ALLEANZA ASSICURAZIONI S.P.A (INSURANCE) 15,000 189,257
CREDITO ITALIANO S.P.A (BANKING) 217,500 1,138,713
ENI S.P.A (OIL EXPLORATION & PRODUCTION) 43,000 288,204
FIAT S.P.A (MOTOR VEHICLES & PARTS) 138,000 549,351
TELECOM ITALIA S.P.A, ADR (UTILITIES - COMMUNICATION) 5,800 439,713
--------------
2,605,238
--------------
JAPAN (19.6%)
AIWA CO., LTD. (ELECTRONICS) 7,000 209,311
AJINOMOTO CO., INC. (FOOD & BEVERAGES) 20,000 160,939
BANYU PHARMACEUTICAL CO., LTD. (PHARMACEUTICALS) 14,000 181,226
BRIDGESTONE CORP. (MOTOR VEHICLES & PARTS) 17,000 388,645
DAI-ICHI KANGYO BANK LTD., THE (BANKING) 72,000 489,992
DENSO CORP. (MOTOR VEHICLES & PARTS) 17,000 292,771
FUJI PHOTO FILM CO., LTD. (ENTERTAINMENT & LEISURE) 13,000 463,512
FUJITSU LTD. (ELECTRONICS) 30,000 350,870
ITO-YOKADO CO., LTD. (RETAIL) 6,000 311,128
KAO CORP. (CONSUMER PRODUCTS) 15,000 220,855
KEYENCE CORP. (ELECTRONICS) 2,400 323,755
KOMATSU LTD. (MACHINERY & CAPITAL SPENDING) 81,000 367,903
MABUCHI MOTOR CO., LTD. (ELECTRICAL EQUIPMENT) 10,000 579,864
MITSUBISHI ESTATE CO., LTD. (REAL ESTATE) 37,000 358,516
MITSUBISHI HEAVY INDS., LTD. (MACHINERY & CAPITAL SPENDING) 40,000 148,372
MITSUBISHI TRUST & BANKING CORP., THE (BANKING) 30,000 286,147
NINTENDO CO., LTD. (ENTERTAINMENT & LEISURE) 2,000 181,075
NIPPON TELEGRAPH & TELEPHONE CORP.
(UTILITIES - COMMUNICATION) 131 1,150,341
NOMURA SECURITIES CO., LTD., THE (FINANCIAL SERVICES) 66,000 806,889
NTT DATA COMMUNICATIONS SYSTEMS CORP. (BUSINESS SERVICES) 7 303,104
OKUMURA CORP. (CONSTRUCTION) 70,000 259,652
ROHM CO., LTD. (ELECTRONICS) 7,000 791,673
8
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CMC INTERNATIONAL STOCK FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
COMMON STOCKS (CONTINUED)
SANWA BANK LTD., THE (BANKING) 79,000 $ 699,697
SEKISUI HOUSE LTD. (CONSTRUCTION) 30,000 234,822
SEVEN-ELEVEN JAPAN CO., LTD. (RETAIL) 3,000 200,984
SHISEIDO CO., LTD. (CONSUMER PRODUCTS) 30,000 396,291
SONY CORP. (ELECTRONICS) 7,000 583,422
SUMITOMO BANK LTD., THE (BANKING) 72,000 681,302
TAKEDA CHEMICAL INDS., LTD. (PHARMACEUTICALS) 27,000 772,596
TOKIO MARINE & FIRE INSURANCE CO., LTD., THE (INSURANCE) 80,000 872,067
TORAY INDS., INC. (CHEMICALS) 35,000 188,645
TOYOTA MOTOR CORP. (MOTOR VEHICLES & PARTS) 15,000 391,749
TRANS COSMOS, INC. (BUSINESS SERVICES) 6,000 174,413
--------------
13,822,528
--------------
MEXICO (1.5%)
* INDUSTRIAS CH SA (SERIES B) (METALS, MINING & STEEL) 119,000 587,429
* TUBOS DE ACERO DE MEXICO SA, ADR (METALS, MINING & STEEL) 26,300 483,263
--------------
1,070,692
--------------
NETHERLANDS (4.4%)
ABN AMRO HOLDING NV (BANKING) 20,324 494,849
AEGON NV (INSURANCE) 7,793 1,010,425
AKZO NOBEL NV (CHEMICALS) 2,600 528,827
ROYAL PHILIPS ELECTRONICS NV (ELECTRONICS) 6,000 528,530
VENDEX INTERNATIONAL NV (CERTIFICATES) (RETAIL) 8,110 520,144
--------------
3,082,775
--------------
NORWAY (1.4%)
* FRED OLSEN ENERGY ASA (OIL EXPLORATION & PRODUCTION) 10,400 185,495
NARVESEN ASA (RETAIL) 4,000 90,655
TOMRA SYSTEMS ASA (MACHINERY & CAPITAL SPENDING) 21,500 691,986
--------------
968,136
--------------
SPAIN (6.4%)
AZKOYEN SA (MANUFACTURING - CONSUMER PRODUCTS) 2,000 273,802
BANCO BILBAO VIZCAYA SA (BANKING) 18,000 926,592
DRAGADOS Y CONSTRUCCIONES SA (CONSTRUCTION) 25,000 810,899
INMOBILIARIA METROPOLITANA VASCO CENTRAL SA
(REAL ESTATE) 11,000 668,089
* TELE PIZZA SA (RESTAURANTS) 4,000 575,181
TELEFONICA DE ESPANA SA, ADR (UTILITIES - COMMUNICATION) 6,000 749,625
VALLEHERMOSO SA (REAL ESTATE) 12,500 484,242
--------------
4,488,430
--------------
SWEDEN (3.0%)
ASSA ABLOY AB (CLASS B) (MANUFACTURING - DIVERSIFIED INDS.) 9,900 345,309
BILSPEDITION TRANSPORT & LOGISTICS (BTL) AB
(TRANSPORTATION) 39,000 223,191
ICB SHIPPING AB (CLASS B) (TRANSPORTATION) 35,000 370,758
9
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- -------------------------------------------------------------------------------------------------
CMC INTERNATIONAL STOCK FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
COMMON STOCKS (CONTINUED)
* MUNTERS AB (MANUFACTURING - CONSUMER PRODUCTS) 32,400 $ 366,236
* N&T ARGONAUT AB (CLASS B) (TRANSPORTATION) 187,000 306,799
SKANDIA INSURANCE CO., LTD. (INSURANCE) 5,400 376,003
SPECTRA-PHYSICS AB (CLASS A) (ELECTRONICS) 6,100 117,415
--------------
2,105,711
--------------
SWITZERLAND (3.3%)
CREDIT SUISSE GROUP (REGISTERED) (FINANCIAL SERVICES) 4,000 880,294
NOVARTIS AG (BEARER) (PHARMACEUTICALS) 680 1,128,269
UNION BANK OF SWITZERLAND (BANKING) 200 322,241
--------------
2,330,804
--------------
THAILAND (0.5%)
* BANGKOK BANK PUBLIC CO., LTD. (BANKING) 75,000 189,355
THAI FARMERS BANK PUBLIC CO., LTD. (FOREIGN) (BANKING) 76,000 175,065
--------------
364,420
--------------
UNITED KINGDOM (20.8%)
BANK OF SCOTLAND PLC (BANKING) 66,000 810,845
BARCLAYS PLC (BANKING) 32,408 934,432
BRITISH AEROSPACE PLC (AIRCRAFT & AEROSPACE) 22,000 734,725
BRITISH PETROLEUM CO. PLC (OIL EXPLORATION & PRODUCTION) 24,034 379,432
BRITISH SKY BROADCASTING GROUP PLC (MEDIA) 68,000 494,430
BRITISH TELECOMMUNICATIONS PLC
(UTILITIES - COMMUNICATION) 62,500 678,002
CADBURY SCHWEPPES PLC (FOOD & BEVERAGES) 12,500 182,193
COMPASS GROUP PLC (RESTAURANTS) 50,000 865,001
ELECTROCOMPONENTS PLC (ELECTRONICS) 56,305 547,272
GRANADA GROUP PLC (ENTERTAINMENT & LEISURE) 40,649 699,831
HAYS PLC (BUSINESS SERVICES) 68,400 1,159,884
MISYS PLC (BUSINESS SERVICES) 5,300 254,695
NATIONAL WESTMINSTER BANK PLC (BANKING) 59,000 1,180,463
NEXT PLC (RETAIL) 70,900 586,621
PEARSON PLC (MEDIA) 31,000 485,521
RAILTRACK GROUP PLC (TRANSPORTATION) 50,000 913,057
ROBERT WALTERS PLC (BUSINESS SERVICES) 8,000 62,514
SELECT APPOINTMENTS HOLDINGS PLC (BUSINESS SERVICES) 24,000 332,963
SIEBE PLC (MACHINERY & CAPITAL SPENDING) 38,102 850,865
SMITHKLINE BEECHAM PLC (PHARMACEUTICALS) 93,738 1,117,150
VODAFONE GROUP PLC (UTILITIES - COMMUNICATION) 35,000 383,191
WETHERSPOON, J.D. PLC (RESTAURANTS) 65,375 352,410
WPP GROUP PLC (MEDIA) 100,000 634,334
--------------
14,639,831
--------------
TOTAL COMMON STOCKS
(COST $48,815,098) 62,562,973
--------------
10
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC INTERNATIONAL STOCK FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
PREFERRED STOCKS (1.6%)
BRAZIL (0.2%)
DIXIE TOGA SA (CONTAINERS) 233,000 $ 132,398
* EMPRESA NACIONAL DE COMERCIO REDITO E PARTICIPACOES SA
(TEXTILES) 1,000,000 2,710
--------------
135,108
--------------
GERMANY (1.4%)
PORSCHE AG (MOTOR VEHICLES & PARTS) 390 976,087
--------------
TOTAL PREFERRED STOCKS
(COST $732,059) 1,111,195
--------------
RIGHT (0.0%)
SPAIN (0.0%)
* TELEFONICA DE ESPANA SA, ADR (05/04/1998)
(UTILITIES - COMMUNICATION)
(COST $0) 6,000 13,500
--------------
WARRANT (1.3%)
FRANCE (1.3%)
* CIE GENERALE DES EAUX (05/02/2001) (UTILITIES)
(COST $406,947) 652,000 948,620
--------------
TOTAL INVESTMENTS, EXCLUDING TEMPORARY INVESTMENTS
(COST $49,954,104) 64,636,288
REPURCHASE AGREEMENTS(7.5% )
GOLDMAN SACHS CORP.
5.414% DATED 04/30/1998,
DUE 05/01/1998 IN THE
AMOUNT OF $3,397,313
COLLATERALIZED BY U.S. TREASURY NOTES
6.125% TO 6.500%
10/15/2006 TO 08/15/2007. $ 3,396,809 3,396,809
--------------
J.P. MORGAN SECURITIES, INC.
5.424% DATED 04/30/1998,
05/01/1998 IN THE
AMOUNT OF $1,900,282
COLLATERALIZED BY U.S. TREASURY NOTES
6.500% TO 7.875% DUE
05/31/200 TO 08/15/2001. 1,900,000 1,900,000
--------------
TOTAL REPURCHASE AGREEMENTS
(COST $5,296,809) 5,296,809
--------------
11
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC INTERNATIONAL STOCK FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
TOTAL INVESTMENTS (99.1%)
(COST $55,250,913) $ 69,933,097
CASH AND RECEIVABLES LESS LIABILITIES (0.9%) 606,131
--------------
NET ASSETS (100%) $ 70,539,228
==============
(1) See Note 1 of Notes to Financial Statements.
* Non-Income Producing
The accompanying notes are an integral part of the financial statements.
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
STATEMENTS OF ASSETS AND LIABILITIES
- ----------------------------------------------------------------------------------------------------------------
April 30, 1998
(Unaudited)
CMC Small CMC International
Cap Fund Stock Fund
------------------- -------------------
<S> <C> <C>
ASSETS:
Investments at identified cost .................................. $ 284,056,315 $ 49,954,104
- ------------------------------------------------------------------- ------------------- -------------------
Investments at value (Notes 1 and 2)............................. $ 342,502,224 $ 64,636,288
Temporary cash investments, at cost (Note 1)..................... 37,255,231 5,296,809
Cash............................................................. - 114,823
Cash denominated in foreign currencies
(cost $358,298) (Note 1)....................................... - 356,932
Receivable for:
Interest....................................................... 54,574 18,880
Dividends...................................................... 38,243 219,592
Investments sold............................................... 5,594,666 -
Capital stock sold............................................. 1,516,000 -
------------------- -------------------
Total assets..................................................... 386,960,938 70,643,324
------------------- -------------------
LIABILITIES:
Payable for:
Capital stock redeemed......................................... 8,199,962 -
Investments purchased.......................................... 3,661,314 -
Investment management fee (Note 4)............................. 240,490 43,257
Accrued expenses .............................................. 30,626 60,839
------------------- -------------------
Total liabilities............................................... 12,132,392 104,096
------------------- -------------------
Net assets applicable to outstanding shares...................... $ 374,828,546 $ 70,539,228
=================== ===================
Net assets consist of:
Undistributed net investment income (loss)..................... $ (456,679) $ 78,509
Unrealized appreciation (depreciation) on:
Investments.................................................. 58,445,909 14,682,184
Translation of assets and liabilities in foreign currencies - (3,003)
Undistributed net realized gain (loss) from:
Investments................................................ 48,145,327 494,617
Foreign currency transactions.............................. - (536,523)
Capital paid in (Note 3)....................................... 268,693,989 55,823,444
------------------- ---------------------
$ 374,828,546 $ 70,539,228
=================== =====================
Shares of capital stock outstanding (Note 3)....................... 6,276,480 1,463,461
=================== =====================
Net asset value, offering and
redemption price per share (1).................................. $ 59.72 $ 48.20
=================== =====================
(1) The net asset value per share is computed by dividing net assets applicable
to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
STATEMENTS OF OPERATIONS
- ---------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 1998
(Unaudited)
CMC Small CMC International
Cap Fund Stock Fund
------------------- -------------------
<S> <C> <C>
INVESTMENT INCOME:
Income:
Interest.................................................... $ 857,074 $ 119,369
Dividends................................................... 253,339 364,639
Foreign taxes withheld (net of reclaims).................... (51,391)
------------------- -------------------
Total income............................................. 1,110,413 432,617
------------------- -------------------
Expenses:
Investment management fees (Note 4)......................... 1,510,536 253,200
Shareholder servicing costs (Note 4)........................ 9,000 9,000
Financial information and subscriptions..................... 75 5,700
Accounting service fees..................................... - 14,787
Custodian fees.............................................. 9,089 33,637
Bank transaction and checking fees.......................... 9,244 13,745
Registration fees........................................... 110 110
Legal, insurance, auditing fees and other................... 29,038 23,929
------------------- -------------------
Total expenses........................................... 1,567,092 354,108
------------------- -------------------
Net investment income (loss) (Note 1).......................... (456,679) 78,509
------------------- -------------------
Realized gain (loss) and unrealized appreciation (depreciation)
from investments and foreign currency transactions:
Net realized gain(loss) from:
Investments (Note 2)........................................ 48,389,339 504,309
Foreignn currency transactions (Notev1)..................... - (536,523)
------------------- -------------------
Net realized gain (loss)................................. 48,389,339 (32,214)
------------------- -------------------
Net unrealized appreciation (depreciation) on:
Investments (Note 1)........................................ (17,142,497) 7,940,273
Translation of assets and liabilities in foreign
currencies (Note 1)....................................... - 72,401
------------------ -------------------
Net unrealized appreciation (depreciation)
during the period...................................... (17,142,497) 8,012,674
------------------ -------------------
Net gain on investment and foreign currency
transactions (Note 1)........................................ 31,246,842 7,980,460
------------------ -------------------
Net increase in net assets resulting from operations........... $ 30,790,163 $ 8,058,969
================== ===================
The accompanying notes are an integral part of the financial statements.
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
STATEMENTS OF CHANGES IN NET ASSETS
- ---------------------------------------------------------------------------------------------------------------
Six Months Ended April 30, 1998 (Unaudited)
and Fiscal Year Ended October 31, 1997
CMC Small CMC International
Cap Fund Stock Fund
------------------------------------- -------------------------------------
1998 1997 1998 1997
----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)............. $ (456,679) $ (374,369) $ 78,509 $ 785,646
Net realized gain (loss) from:
Investments (Note 2).................. 48,389,339 93,042,443 504,309 12,101,115
Foreign currency transactions
(Note 1).............................. - - (536,523) (59,471)
Change in net unrealized appreciation
(depreciation) on:
Investments........................... (17,142,497) 15,392,662 7,940,273 (43,839)
Translation of assets and liabilities
in foreign currencies (Note 1 )....... - - 72,401 (44,564)
----------------- ----------------- ----------------- -----------------
Net increase in net assets
resulting from operations............. 30,790,163 108,060,736 8,058,969 12,738,887
Distributions to shareholders:
From net investment income............... - - - (764,742)
From net realized gain from
investment transactions............... - (92,831,342) - (9,756,639)
Capital share transactions, net (Note 3)..... (177,732,108) (15,866,910) (18,990,389) 5,711,074
----------------- ----------------- ----------------- -----------------
Net increase (decrease) in net assets.... (146,941,945) (637,516) (10,931,420) 7,928,580
NET ASSETS:
Beginning of period.......................... 521,770,491 522,408,007 81,470,648 73,542,068
----------------- ----------------- ----------------- -----------------
End of period (1)............................ $ 374,828,546 $ 521,770,491 $ 70,539,228 $ 81,470,648
================= ================= ================= =================
(1) Includes undistributed net investment
gain (loss) of: $ (456,679) $ - $ 78,509 $ -
The accompanying notes are an integral part of the financial statements.
</TABLE>
15
<PAGE>
- --------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
1. Significant accounting policies:
CMC Small Cap Fund and CMC International Stock Fund (the Funds) are
portfolios of CMC Fund Trust (the Trust), an open-end diversified investment
company registered under the Investment Company Act of 1940, as amended. The
Trust has established two other portfolios, CMC High Yield Fund and CMC Short
Term Bond Fund, neither of which are included in these financial statements.
Each portfolio issues a separate series of the Trust's shares and maintains a
separate investment portfolio. The policies described below are consistently
followed by the Funds for the preparation of their financial statements in
conformity with generally accepted accounting principles.
Investment valuation - The values of the Funds' investments are based on
the last sale prices reported by the principal securities exchanges on which the
investments are traded, or, in the absence of recorded sales, at the closing bid
prices on such exchanges or over-the-counter markets. Temporary investments in
short-term securities, principally repurchase agreements, are valued at cost,
which approximates market.
Forward foreign currency exchange contracts - The CMC International Stock
Fund enters into forward foreign currency exchange contracts to hedge certain
portfolio securities denominated in foreign currencies. Forward contracts are
recorded at market value. The CMC International Stock Fund could be exposed to
risks if counterparties to the forward contracts are unable to meet the terms of
their contracts or if the value of the foreign currency changes unfavorably. The
effect of any change in the value of a hedged foreign currency would be offset
by the increase (resulting from a change in exchange rates) in value of the
securities denominated in that currency. Net realized loss arising from forward
contracts amounted to $280,337 and is included in net realized loss from foreign
currency transactions. CMC International Stock Fund had no outstanding forward
contracts on April 30, 1998.
Foreign currency translations - The books and records of the CMC
International Stock Fund are maintained in U.S. dollars. Foreign currency
transactions are translated into U.S. dollars on the following basis:
(i) market value of investment securities, other assets, and
liabilities at the daily rates of exchange on the valuation date, and
(ii) purchases and sales of investment securities, dividend and
interest income and certain expenses at the rates of exchange
prevailing on the respective dates of such transactions.
The CMC International Stock Fund does not isolate that portion of the
results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in market prices of
investments held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized foreign currency gains or losses arise from the sale
of foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
CMC International Stock Fund's books and the U.S. dollar equivalent of the
amounts actually received or paid. Net unrealized foreign currency gains and
losses arise from changes in the value of assets and liabilities, other than
investments in securities, resulting from changes in the exchange rates.
16
<PAGE>
- --------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
1. Significant accounting policies (Continued):
Shareholder distributions - The Funds distribute net investment income
twice a year and any net realized gains from investment transactions annually.
Distributions to shareholders are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
foreign currency transactions, net operating losses, deferral of losses from
wash sales and passive foreign investment companies.
Use of estimates - The preparation of the financial statements in
accordance with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of income and expenses during
the reporting period. Actual results could differ from those estimates.
Federal income taxes - The Funds have made no provision for federal income
taxes on net investment income or net realized gains from sales of securities,
since it is the intention of the Funds to comply with the provisions of the
Internal Revenue Code available to certain regulated investment companies, and
to make distributions of income and security profits sufficient to relieve them
from substantially all federal income taxes.
Other - Investment transactions are accounted for on the date the
investments are purchased or sold. The cost of investments sold is determined by
the use of the specific identification method for both financial reporting and
income tax purposes. Interest income is recorded on the accrual basis and
dividend income is recorded on the ex-dividend date. Realized gains and losses
from investment transactions and unrealized appreciation or depreciation of
investments are reported on the basis of identified costs.
The Funds, through their custodians, receive delivery of underlying
securities collateralizing repurchase agreements (included in temporary cash
investments). Market values of these securities are required to be at least 100%
of the cost of the repurchase agreements. The Funds' investment adviser
determines that the value of the underlying securities is at all times at least
equal to the resale price. In the event of default or bankruptcy by the other
party to the agreement, realization and/or retention of the collateral may be
subject to legal proceedings.
17
<PAGE>
- --------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
2. Investment transactions:
Aggregate purchases, sales and maturities, net realized gain and unrealized
appreciation (depreciation) of investments, excluding temporary cash
investments, as of and for the period ended April, 30 1998 were as follows:
<TABLE>
<CAPTION>
CMC Small CMC International
Cap Fund Stock Fund
---------------- -----------------
<S> <C> <C>
Purchases:
Investment securities other than U.S. Government obligations...... $ 295,359,497 $ 13,917,655
================ =================
Sales and Maturities:
Investment securities other than U.S. Government obligations...... $ 474,452,671 $ 33,349,101
================ =================
Net Realized Gain:
Investment securities other than U.S. Government obligations...... $ 48,389,339 $ 504,309
================ =================
Unrealized Appreciation (Depreciation)
as of April 30, 1998:
Appreciation...................................................... $ 67,460,801 $ 18,294,113
Depreciation...................................................... (9,014,892) (3,611,929)
================ =================
Net unrealized appreciation .................................... $ 58,445,909 $ 14,682,184
================ =================
Unrealized Appreciation (Depreciation) for
federal income tax purposes as of April 30, 1998:
Appreciation...................................................... $ 67,193,872 $ 18,294,113
Depreciation...................................................... (9,326,946) (3,624,866)
----------------- ------------------
Net unrealized appreciation .................................... $ 57,866,926 $ 14,669,247
================= ==================
For federal income tax purposes, the cost of investments
owned at April 30, 1998......................................... $ 284,635,298 $ 49,967,041
================= ==================
The net realized gain for CMC Small Cap Fund includes proceeds of $674,326 from
shareholder class action suits related to securities held by the Fund.
</TABLE>
18
<PAGE>
- --------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
3. Capital Stock: CMC Small CMC International
Cap Fund Stock Fund
------------------ ------------------ ------------------ ------------------
Six Months Fiscal Year Six Months Fiscal Year
Ended Ended Ended Ended
April 30, 1998 October 31, 1997 April 30, 1998 October 31, 1997
------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
Shares:
Shares sold.......................... 798,368 2,075,132 78,229 492,558
Shares issued for reinvestment
of dividends....................... - 1,635,550 - 242,655
------------------ ------------------ ------------------ ------------------
798,368 3,710,682 78,229 735,213
Less shares redeemed................. (4,112,527) (4,158,883) (522,199) (559,687)
------------------ ------------------ ------------------ ------------------
Net increase (decrease) in shares.... (3,314,159) (448,201) (443,970) 175,526
================== ================== ================== ==================
Amounts:
Sales................................ $ 43,420,461 $ 119,268,120 $ 3,592,396 $ 23,076,473
Reinvestment of dividends............ - 88,973,947 - 10,363,810
------------------ ------------------ ------------------ ------------------
43,420,461 208,242,067 3,592,396 33,440,283
Less redemptions..................... (221,152,569) (224,108,977) (22,582,785) (27,729,209)
------------------ ------------------ ------------------ ------------------
Net increase (decrease).............. $ (177,732,108) $ (15,866,910) $ (18,990,389) $ 5,711,074
================== ================== ================== ==================
Capital stock authorized (shares) 100,000,000 100,000,000
</TABLE>
4. Transactions with affiliates and related parties:
<TABLE>
<CAPTION>
CMC Small CMC International
Cap Fund Stock Fund
------------- -----------------
<S> <C> <C>
Investment management fees incurred..................................... $ 1,510,536 $ 253,200
Investment management fee computation basis
(percentage of daily net assets per annum)........................... 0.75.of.1% 0.75.of.1%
Transfer agent fee (included in shareholder servicing costs)............ $ 9,000 $ 9,000
Fees earned by trustees not affiliated with the Fund's investment
adviser or transfer agent (included in other expenses)................ $ 7,659 $ 1,437
</TABLE>
The transfer agent for the Fund is Columbia Trust Company (CTC), an affiliate of
CMC. The transfer agent is compensated based on a per account fee or a minimum
of $1,500 per month. The contracts for investment advisory and transfer agent
services must be renewed annually by a majority vote of the Fund's shareholders
or by the Trustees of CMC Fund Trust (the Trust).
On December 10, 1997, CMC, CTC and certain of their affiliates were acquired by
Fleet Financial Group, Inc. (Fleet), a publicly owned multi-bank holding company
registered under the Bank Holding Company Act of 1956. Prior to that date,
certain officers and trustees of the Trust were also officers and directors of
CMC and CTC. Those individuals did not receive any compensation or other payment
from the Trust. Following the transaction and as a result of federal banking
regulations, no officers or trustees of the Trust are officers or directors of
CMC or CTC. J. Jerry Inskeep, Jr., an officer and trustee of the Trust, is
affiliated with Fleet, but received no compensation or other payments from the
Trust.
19
<PAGE>
- --------------------------------------------------------------------------------
CMC SMALL CAP FUND
CMC INTERNATIONAL STOCK FUND
Portfolios of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
5. Proxy Voting Results
On December 4, 1997, CMC Fund Trust held a Special Meeting of Shareholders to
approve new investment advisory contracts with the Adviser. New investment
advisory contracts were approved by CMC Small Cap Fund and by CMC International
Stock Fund as shown below:
<TABLE>
<CAPTION>
Total Total Voted Total Voted
Fund Outstanding For Against Abstention
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CMC Small Cap Fund 7,975,274 6,735,230 0 0
CMC International Stock Fund 1,978,639 1,892,101 0 0
</TABLE>
20
<PAGE>
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SEMI-ANNUAL REPORT
(Unaudited )
April 30, 1998
1300 S.W. Sixth, P.O. Box 1350, Portland, OR 97207
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
FINANCIAL HIGHLIGHTS
For a Share Outstanding Throughout the Period
- ---------------------------------------------------------------------------------------------------------------------------
Six Months
Ended Fiscal Year Ended October 31,
April 30, 1998 ------------ ------------ ------------ ------------
(Unaudited) (1) 1997 1996 1995 1994 (1)(2)
----------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $ 36.85 $ 35.95 $ 36.24 $ 34.48 $ 35.00
----------- ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income................... 1.52 3.18 3.23 3.31 0.94
Net realized and unrealized gains
(losses) on investments............... 0.49 1.28 0.10 2.11 (0.52)
----------- ------------ ------------ ------------ ------------
Total from investment operations. 2.01 4.46 3.33 5.42 0.42
----------- ------------ ------------ ------------ ------------
Less distributions:
Dividends (from net investment income). (1.52) (3.18) (3.23) (3.31) (0.94)
Distributions (from capital gains)..... (0.38) (0.39) (0.35)
----------- ------------ ------------ ------------ ------------
Total distributions.............. (1.52) (3.56) (3.62) (3.66) (0.94)
----------- ------------ ------------ ------------ ------------
Net asset value, end of period............... $ 37.34 $ 36.85 $ 35.95 $ 36.24 $ 34.48
=========== ============ ============ ============ ============
Total return................................. 5.52% (3) 12.90% 9.61% 16.49% 1.21% (3)
Ratios/Supplemental data
Net assets, end of period (in thousands)..... $ 223,316 $ 119,196 $ 69,614 $ 42,192 $ 9,602
Ratio of expenses to average net assets...... 0.44% 0.45% 0.50% 0.54% 0.54%
Ratio of net investment income to
average net assets........................ 8.17% 8.60% 8.90% 9.36% 9.86%
Portfolio turnover rate...................... 80.62% 68.96% 56.06% 45.64% 72.67%
(1) Ratios and portfolio turnover rates are annualized.
(2) From inception of operations on July 6, 1994.
(3) Not annualized.
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
APRIL 30, 1998
(UNAUDITED)
Principal
Amount Value (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (97.3%)
BASIC INDUSTRY (1.0%)
METALS/MINING (1.0%)
RYERSON TULL, INC.
NOTES
8.500% 07/15/2001 $ 2,250,000 $ 2,340,000
--------------
CONSUMER RELATED (16.9%)
HOTEL/GAMING (3.6%)
HMH PROPERTIES, INC.
SERIES B SENIOR SECURED NOTES
9.500% 05/15/2005 1,900,000 2,054,375
RIO HOTEL & CASINO, INC.
SENIOR SUBORDINATED NOTES
9.500% 04/15/2007 3,500,000 3,780,000
STATION CASINOS, INC.
SENIOR SUBORDINATED NOTES
9.625% 06/01/2003 2,125,000 2,199,375
--------------
8,033,750
--------------
HEALTHCARE (8.1%)
ABBEY HEALTHCARE GROUP, INC.
SENIOR SUBORDINATED NOTES
9.500% 11/01/2002 2,650,000 2,689,750
CONMED CORP. (144A)
SENIOR SUBORDINATED NOTES
9.000% 03/15/2008 3,240,000 3,256,200
HEALTHSOUTH CORP.
SENIOR SUBORDINATED NOTES
9.500% 04/01/2001 2,900,000 3,030,500
QUORUM HEALTH GROUP, INC.
SENIOR SUBORDINATED NOTES
8.750% 11/01/2005 3,590,000 3,733,600
TENET HEALTHCARE CORP.
SENIOR SUBORDINATED NOTES
10.125% 03/01/2005 2,750,000 3,052,500
TENET HEALTHCARE CORP.
SENIOR NOTES
8.625% 12/01/2003 2,250,000 2,362,500
--------------
18,125,050
--------------
2
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
Principal
Amount Value (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (CONTINUED)
FOOD/BEVERAGE/TOBACCO (1.4%)
PURINA MILLS, INC. (144A)
SENIOR SUBORDINATED NOTES
9.000% 03/15/2010 $ 3,000,000 $ 3,090,000
--------------
OTHER (3.8%)
MAXIM GROUP, INC.
SERIES B SENIOR SUBORDINATED NOTES
9.250% 10/15/2007 3,100,000 3,146,500
WESTPOINT STEVENS, INC.
SENIOR SUBORDINATED DEBENTURES
9.375% 12/15/2005 4,985,000 5,259,175
--------------
8,405,675
--------------
TOTAL CONSUMER RELATED 37,654,475
--------------
ENERGY (7.9%)
GULF CANADA RESOURCES LTD.
SUBORDINATED DEBENTURES
9.625% 07/01/2005 2,500,000 2,712,500
KELLEY OIL & GAS CORP.
SERIES B SENIOR SUBORDINATED NOTES
10.375% 10/15/2006 1,400,000 1,456,000
NEWPARK RESOURCES, INC.
SERIES B SENIOR SUBORDINATED NOTES
8.625% 12/15/2007 4,260,000 4,302,600
NUEVO ENERGY CO.
SENIOR SUBORDINATED NOTES
9.500% 04/15/2006 3,100,000 3,286,000
SANTA FE ENERGY RESOURCE, INC.
SENIOR SUBORDINATED DEBENTURES
11.000% 05/15/2004 5,500,000 5,940,000
--------------
TOTAL ENERGY 17,697,100
--------------
HOUSING RELATED (4.2%)
JOHNS MANVILLE INTERNATIONAL GROUP
SENIOR NOTES
10.875% 12/15/2004 3,750,000 4,200,000
WEBB (DEL E.) CORP.
SENIOR SUBORDINATED DEBENTURES
9.000% 02/15/2006 4,990,000 5,089,800
--------------
TOTAL HOUSING RELATED 9,289,800
--------------
3
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
Principal
Amount Value (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (CONTINUED)
INDUSTRIAL (5.2%)
BUSINESS SERVICES (5.2%)
IRON MOUNTAIN, INC.
SENIOR SUBORDINATED NOTES
10.125% 10/01/2006 $ 1,000,000 $ 1,080,000
PIERCE LEAHY CORP.
SENIOR SUBORDINATED NOTES
11.125% 07/15/2006 4,006,000 4,486,720
UNISYS CORP.
SENIOR NOTES
7.875% 04/01/2008 4,490,000 4,490,000
UNITED STATIONERS SUPPLY CO. (144A)
SENIOR SUBORDINATED NOTES
8.375% 04/15/2008 1,500,000 1,515,000
--------------
TOTAL INDUSTRIAL 11,571,720
--------------
MANUFACTURING (11.2%)
AVIATION SALES CO. (144A)
SENIOR SUBORDINATED NOTES
8.125% 02/15/2008 5,485,000 5,375,300
BREED TECHNOLOGIES, INC. (144A)
SENIOR SUBORDINATED NOTES
9.250% 04/15/2008 500,000 505,625
HAYES WHEELS INTERNATIONAL, INC.
SERIES B SENIOR SUBORDINATED NOTES
9.125% 07/15/2007 2,200,000 2,310,000
POLYMER GROUP, INC.
SERIES B SENIOR SUBORDINATED NOTES
9.000% 07/01/2007 1,500,000 1,548,750
SILGAN HOLDINGS, INC.
SENIOR SUBORDINATED DEBENTURES
9.000% 06/01/2009 1,500,000 1,567,500
TITAN WHEEL INTERNATIONAL, INC.
SENIOR SUBORDINATED NOTES
8.750% 04/01/2007 4,890,000 5,036,700
TRACOR, INC.
SENIOR SUBORDINATED NOTES
8.500% 03/01/2007 5,240,000 5,659,200
WYMAN-GORDON CO. (144A)
SENIOR NOTES
8.000% 12/15/2007 3,000,000 3,045,000
--------------
TOTAL MANUFACTURING 25,048,075
--------------
4
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
Principal
Amount Value (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (CONTINUED)
MEDIA (29.6%)
ADELPHIA COMMUNICATIONS CORP.
SERIES B SENIOR NOTES
10.500% 07/15/2004 $ 4,990,000 $ 5,489,000
CENTURY COMMUNICATIONS CORP.
SENIOR DISCOUNT NOTES
0.000% 03/15/2003 6,985,000 4,645,025
CINEMARK USA, INC.
SERIES B SENIOR SUBORDINATED NOTES
9.625% 08/01/2008 1,500,000 1,563,750
COMCAST CORP.
SENIOR SUBORDINATED DEBENTURES
9.500% 01/15/2008 3,990,000 4,243,724
HERITAGE MEDIA CORP.
SENIOR SUBORDINATED NOTES
8.750% 02/15/2006 2,250,000 2,385,000
HOLLINGER INTERNATIONAL PUBLISHING, INC.
SENIOR NOTES
8.625% 03/15/2005 4,400,000 4,576,000
JACOR COMMUNICATIONS CO.
SERIES B SENIOR SUBORDINATED NOTES
8.750% 06/15/2007 2,750,000 2,846,250
JONES INTERCABLE, INC.
SENIOR NOTES
8.875% 04/01/2007 2,490,000 2,614,500
JONES INTERCABLE, INC.
SENIOR NOTES
7.625% 04/15/2008 1,700,000 1,666,000
K-III COMMUNICATIONS CORP.
SENIOR NOTES
10.250% 06/01/2004 2,600,000 2,782,000
LAMAR ADVERTISING CO.
SENIOR SUBORDINATED NOTES
9.625% 12/01/2006 4,090,000 4,335,400
LENFEST COMMUNICATIONS, INC.
SENIOR SECURED NOTES
8.375% 11/01/2005 4,490,000 4,647,150
OUTDOOR SYSTEMS, INC.
SENIOR SUBORDINATED NOTES
9.375% 10/15/2006 4,490,000 4,725,725
REGAL CINEMAS, INC.
SENIOR SUBORDINATED NOTES
8.500% 10/01/2007 2,750,000 3,011,250
5
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
Principal
Amount Value (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (CONTINUED)
SFX BROADCASTING, INC.
SERIES B SENIOR SUBORDINATED NOTES
10.750% 05/15/2006 $ 2,250,000 $ 2,475,000
SINCLAIR BROADCAST GROUP, INC.
SENIOR SUBORDINATED NOTES
8.750% 12/15/2007 4,250,000 4,324,375
TCI COMMUNICATIONS, INC.
SENIOR NOTES
8.000% 08/01/2005 2,000,000 2,156,200
VIACOM, INC.
SUBORDINATED DEBENTURES
8.000% 07/07/2006 3,000,000 3,041,250
YOUNG BROADCASTING, INC.
SERIES B SENIOR SUBORDINATED NOTES
10.125% 02/15/2005 4,250,000 4,526,250
--------------
TOTAL MEDIA 66,053,849
--------------
RETAIL (4.2%)
OTHER (4.2%)
SPECIALTY RETAILER, INC.
SERIES B SENIOR NOTES
8.500% 07/15/2005 4,990,000 5,139,700
ZALE CORP.
SERIES B SENIOR NOTES
8.500% 10/01/2007 4,240,000 4,314,200
--------------
TOTAL RETAIL 9,453,900
--------------
TRANSPORTATION (2.6%)
OTHER (2.6%)
ALLIED HOLDING, INC.
SERIES B SENIOR NOTES
8.625% 10/01/2007 2,500,000 2,543,750
TEEKAY SHIPPING CORP.
GTD. 1ST PFD. SHIP. MTG.
NOTES
8.320% 02/01/2008 3,150,000 3,276,000
--------------
TOTAL TRANSPORTATION 5,819,750
--------------
6
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
Principal
Amount Value (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (CONTINUED)
UTILITY (12.2%)
ELECTRICS (5.6%)
AES CORP.
SENIOR SUBORDINATED NOTES
10.250% 07/15/2006 $ 1,700,000 $ 1,870,000
8.375% 08/15/2007 3,500,000 3,561,250
CMS ENERGY CORP. (144A)
SENIOR UNSECURED NOTES
7.000% 01/15/2005 5,750,000 5,514,423
CALIFORNIA ENERGY CO., INC.
SENIOR SECURED NOTES
9.875% 06/30/2003 1,400,000 1,508,752
--------------
12,454,425
--------------
TELECOMMUNICATIONS (6.6%)
FLAG LTD. (144A)
SENIOR NOTES
8.250% 01/30/2008 4,710,000 4,792,425
LEVEL 3 COMMUNICATIONS, INC. (144A)
SENIOR NOTES
9.125% 05/01/2008 2,300,000 2,277,000
NEXTLINK COMMUNICATIONS, INC. (144A)
SENIOR DISCOUNT NOTES
0.000% 04/15/2008
(0.000% TO 04/15/2003 THEN 9.450% TO 04/15/2008) 1,000,000 625,000
PAGING NETWORK, INC.
SENIOR SUBORDINATED NOTES
10.000% 10/15/2008 4,150,000 4,316,000
WORLDCOM, INC.
SENIOR NOTES
8.875% 01/15/2006 2,499,000 2,723,835
--------------
14,734,260
--------------
TOTAL UTILITY 27,188,685
--------------
YANKEE (2.3%)
MEXICO-UNITED MEXICAN STATES
GLOBAL BONDS
11.375% 09/15/2016 1,500,000 1,745,625
SB TREASURY CO. LLC (144A)
SERIES A PREFERRED
9.400% 12/29/2049 3,250,000 3,328,780
--------------
TOTAL YANKEE 5,074,405
--------------
7
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
Principal
Amount Value (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (CONTINUED)
TOTAL CORPORATE BONDS
(COST $214,304,698) $ 217,191,759
--------------
REPURCHASE AGREEMENT (0.6%)
GOLDMAN SACHS CORP.
5.414% DATED 04/30/1998,
DUE 05/01/1998 IN THE
AMOUNT OF $1,363,252.
COLLATERALIZED BY U.S. TREASURY NOTES
6.125% TO 6.500% DUE
10/15/2006 TO 08/15/2007
(COST $1,363,050) $ 1,363,050 1,363,050
--------------
TOTAL INVESTMENTS (97.9%)
(COST $215,667,748) 218,554,809
RECEIVABLES LESS LIABILITIES (2.1%) 4,761,091
--------------
NET ASSETS (100.0%) $ 223,315,900
==============
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part of the financial statements.
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
STATEMENT OF ASSETS AND LIABILITIES
- ------------------------------------------------------------------------------------------------
April 30, 1998
(Unaudited)
<S> <C>
ASSETS:
Investments at identified cost ............................................ $ 214,304,698
- ----------------------------------------------------------------------------- ----------------
Investments at value (Notes 1 and 2)....................................... $ 217,191,759
Temporary cash investment, at cost (Note 1)................................ 1,363,050
Receivable for:
Interest................................................................. 4,583,399
Investments sold......................................................... 501,250
----------------
Total assets............................................................... 223,639,458
----------------
LIABILITIES:
Payable for:
Dividends and distributions.............................................. 245,151
Investment management fee (Note 4)....................................... 73,547
Accrued expenses ........................................................ 4,860
----------------
Total liabilities.......................................................... 323,558
----------------
Net assets applicable to outstanding shares................................ $ 223,315,900
================
Net assets consist of:
Unrealized appreciation on investments................................... $ 2,887,061
Undistributed net realized gain from investments......................... 1,087,740
Capital paid in (Note 3)................................................. 219,341,099
----------------
$ 223,315,900
================
Shares of capital stock outstanding (Note 3)................................. 5,980,633
================
Net asset value, offering and
redemption price per share (1)............................................ $ 37.34
================
(1) The net asset value per share is computed by dividing net assets
applicable to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
STATEMENT OF OPERATIONS
- ------------------------------------------------------------------------------------------------
Six Months Ended April 30, 1998
(Unaudited)
<S> <C>
INVESTMENT INCOME:
Income:
Interest............................................................ $ 7,234,349
----------------
Expenses:
Investment management fees (Note 4)................................. 334,439
Shareholder servicing costs (Note 4)................................ 9,000
Financial information and subscriptions............................. 1,700
Custodian fees...................................................... 2,411
Bank transaction and checking fees.................................. 1,758
Registration fees................................................... 110
Legal, insurance, auditing fees and other........................... 17,657
----------------
Total expenses.................................................. 367,075
----------------
Net investment income (Note 1).......................................... 6,867,274
----------------
Realized gain and unrealized appreciation from
investment transactions:
Net realized gain from investments (Note 2)............................. 1,056,810
Net unrealized appreciation on investments during the period (Note 1)... 437,557
----------------
Net gain on investments (Note 1)........................................ 1,494,367
----------------
Net increase in net assets resulting from operations.................... $ 8,361,641
================
The accompanying notes are an integral part of the financial statements.
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
STATEMENTS OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------------------------------------------------------
Six Months
Ended Fiscal Year
April 30,1998 Ended
(Unaudited) October 31, 1997
---------------- ----------------
<S> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment income ............................................. $ 6,867,274 $ 7,645,481
Net realized gain from investments (Note 2)........................ 1,056,810 1,235,856
Change in net unrealized appreciation on investments............... 437,557 1,267,480
---------------- ----------------
Net increase in net assets resulting from operations............... 8,361,641 10,148,817
Distributions to shareholders:
From net investment income......................................... (6,867,274) (7,645,481)
From net realized gain from investment transactions................ - (1,209,953)
Capital share transactions, net (Note 3)............................... 102,625,136 48,289,337
---------------- ----------------
Net increase in net assets......................................... 104,119,503 49,582,720
NET ASSETS:
Beginning of period.................................................... 119,196,397 69,613,677
---------------- ----------------
End of period ......................................................... $ 223,315,900 $ 119,196,397
================ ================
The accompanying notes are an integral part of the financial statements.
</TABLE>
11
<PAGE>
- --------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. Significant accounting policies:
CMC High Yield Fund (the Fund) is a portfolio of CMC Fund Trust (the
Trust), an open-end diversified investment company registered under the
Investment Company Act of 1940, as amended. The Trust has established three
other portfolios, CMC Small Cap Fund, CMC International Stock Fund and CMC Short
Term Bond Fund, which are not included in this financial statement. Each
portfolio issues a separate series of the Trust's shares and maintains a
separate investment portfolio. The policies described below are consistently
followed by the Fund for the preparation of its financial statements in
conformity with generally accepted accounting principles.
Investment valuation - The Fund's investments are carried at values deemed
best to reflect their fair values as determined in good faith by or under the
supervision of the Trustees. These values are based on market value as quoted by
dealers who are market makers in these securities or by an independent pricing
service unless circumstances indicate that another method of determining fair
value should be considered. Market values are based on the average of bid and
ask prices, or by reference to other securities with comparable ratings,
interest rates and maturities. Temporary investments in short-term securities,
principally repurchase agreements, are valued at cost, which approximates
market.
Shareholder distributions - The Fund distributes net investment income
monthly and any net realized gains from investment transactions annually.
Distributions to shareholders are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for net
operating losses and deferral of losses from wash sales.
Use of estimates - The preparation of the financial statements in
accordance with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of income and expenses during
the reporting period. Actual results could differ from those estimates.
Federal income taxes - The Fund has made no provisions for federal income
taxes on net investment income or net realized gains from sales of investment
securities, since it is the intention of the Fund to comply with the provisions
of the Internal Revenue Code available to certain regulated investment
companies, and to make distributions of income and security profits sufficient
to relieve it from substantially all federal income taxes.
Other - Investment transactions are accounted for on the date the
investments are purchased or sold. The cost of investments sold is determined by
the use of the specific identification method for both financial reporting and
income tax purposes. Interest income is recorded on the accrual basis.
Amortization of discount or premium is recorded over the life of the respective
instrument. Realized gains and losses from investment transactions and
unrealized appreciation or depreciation of investments are reported on the basis
of identified costs.
The Fund, through its custodian, receives delivery of underlying
securities collateralizing repurchase agreements (included in temporary cash
investments). Market values of these securities are required to be at least 100%
of the cost of the repurchase agreement. The Fund's investment adviser
determines that the value of the underlying securities is at all times at least
equal to the resale price. In the event of default or bankruptcy by the other
party to the agreement, realization and/or retention of the collateral may be
subject to legal proceedings.
The Fund invests in lower rated debt securities, which may be more
susceptible to adverse economic conditions than other investment grade holdings.
These securities are often subordinated to the prior claims of other senior
lenders, and uncertainties exist as to an issuer's ability to meet principal and
interest payments. At April 30, 1998, 100% of the Fund's debt securities were
rated Baa (1%), Ba (43%) or B (56%) by Moody's Investor Services, Inc.
12
<PAGE>
- --------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
2. Investment transactions:
Aggregate purchases, sales and maturities, net realized gain and unrealized
appreciation (depreciation) of investments, excluding temporary cash
investments, as of and for the period ended April 30, 1998, were as follows:
<TABLE>
<CAPTION>
<S> <C>
Purchases:
Investment securities other than U.S. Government obligations.............. $ 149,348,255
U.S. Government obligations............................................... 19,360,313
------------------
Total purchases...................................................... $ 168,708,568
==================
Sales and Maturities:
Investment securities other than U.S. Government obligations.............. $ 45,888,243
U.S. Government obligations............................................... 19,318,359
------------------
Total sales and maturities........................................... $ 65,206,602
==================
Net Realized Gain:
Investment securities other than U.S. Government obligations.............. $ 1,098,763
U.S. Government obligations............................................... (41,953)
------------------
Total net realized gain.............................................. $ 1,056,810
===================
Unrealized Appreciation (Depreciation) as of April 30, 1998:
Appreciation............................................................... $ 3,977,793
Depreciation............................................................... (1,090,732)
------------------
Net unrealized appreciation.......................................... $ 2,887,061
==================
Unrealized Appreciation (Depreciation) for federal income tax purposes as of
April 30, 1998:
Appreciation............................................................... 3,964,668
Depreciation............................................................... (1,104,482)
-------------------
Net unrealized appreciation.............................................. $ 2,860,186
==================
For federal income tax purposes, the cost of
investments owned at April 30, 1998........................................ $ 214,331,573
==================
</TABLE>
3. Capital Stock:
<TABLE>
<CAPTION>
Six Months
Ended Fiscal Year
April 30,1998 Ended
(Unaudited) October 31, 1997
---------------- ----------------
<S> <C> <C>
Shares:
Shares sold...................................................... 3,256,045 1,915,922
Shares issued for reinvestment of dividends...................... 162,748 219,803
---------------- ----------------
3,418,793 2,135,725
Less shares redeemed............................................. (673,131) (837,005)
---------------- ----------------
Net increase in shares........................................... 2,745,662 1,298,720
================ ================
Amounts:
Sales............................................................ $ 121,465,556 $ 70,585,000
Reinvestment of dividends........................................ 6,078,914 8,084,738
---------------- ----------------
127,544,470 78,669,738
Less redemptions................................................. (24,919,334) (30,380,401)
---------------- ----------------
Net increase..................................................... $ 102,625,136 $ 48,289,337
================ ================
Capital stock authorized (shares) 100,000,000
</TABLE>
13
<PAGE>
- --------------------------------------------------------------------------------
CMC HIGH YIELD FUND
A Portfolio of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
4. Transactions with affiliates and related parties:
<TABLE>
<CAPTION>
<S> <C>
Investment management fees incurred.......................................... $ 334,439
Investment management fee
computation basis (percentage of daily net assets
per annum)................................................................. 0.40.of.1%
Transfer agent fee (included in shareholder
servicing costs)........................................................... $ 9,000
Fees earned by trustees not affiliated with the Fund's
investment adviser or transfer agent (included in other expenses).......... $ 3,829
</TABLE>
The transfer agent for the Fund is Columbia Trust Company (CTC), an affiliate of
CMC. The transfer agent is compensated based on a per account fee or a minimum
of $1,500 per month. The contracts for investment advisory and transfer agent
services must be renewed annually by a majority vote of the Fund's shareholders
or by the Trustees of CMC Fund Trust (the Trust).
On December 10, 1997, CMC, CTC and certain of their affiliates were acquired by
Fleet Financial Group, Inc. (Fleet), a publicly owned multi-bank holding company
registered under the Bank Holding Company Act of 1956. Prior to that date,
certain officers and trustees of the Trust were also officers and directors of
CMC and CTC. Those individuals did not receive any compensation or other payment
from the Trust. Following the transaction and as a result of federal
bankingregulations, no officers or directors of the Trust are officers or
trustees of CMC or CTC. J. Jerry Inskeep, Jr., an officer and trustee of the
Trust, is affiliated with Fleet, but received no compensation or other payments
from the Trust.
5. Proxy Voting Results
On December 4, 1997, CMC Fund Trust held a Special Meeting of Shareholders to
approve new investment advisory contracts with the Advisor. A new investment
advisory contract was approved by CMC High Yield Fund. 2,788,978 shares voted
for the new advisory contract out of 3,184,087 shares outstanding. No shares
were voted against the proposal and there were no abstentions.
14
<PAGE>
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
SEMI-ANNUAL REPORT
(Unaudited )
April 30, 1998
1300 S.W. Sixth, P.O. Box 1350, Portland, OR 97207
<PAGE>
- --------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
FINANCIAL HIGHLIGHTS
For a Share Outstanding Throughout the Period
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended
April 30, 1998
(Unaudited) (1)(2)
-----------------
<S> <C>
Net asset value, beginning of period........................ $ 12.00
-----------
Income from investment operations:
Net investment income.................................. 0.18
Net realized and unrealized losses
on investments....................................... (0.06)
-----------
Total from investment operations.............. 0.12
-----------
Less distributions:
Dividends (from net investment income)................ (0.18)
-----------
Net asset value, end of period.............................. $ 11.94
===========
Total return................................................ 1.00% (3)
Ratios/Supplemental data
Net assets, end of period (in thousands).................... $ 29,381
Ratio of expenses to average net assets..................... 0.25 (4)
Ratio of net investment income to
average net assets....................................... 6.29%
Portfolio turnover rate..................................... 209.80%
(1) Ratios and portfolio turnover rates are annualized.
(2) From inception of operations on February 2, 1998.
(3) Not annualized.
(4) The ratio was 0.43% for the period, before voluntary reimbursement of
certain expenses by the investment adviser.
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
APRIL 30, 1998
(UNAUDITED)
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
U.S. GOVERNMENT, FEDERAL AGENCY
OBLIGATIONS (48.0%)
U.S. TREASURY NOTES (8.3%)
6.875% 08/31/1999 $ 1,385,000 $ 1,407,506
5.500% 02/28/2003 1,050,000 1,042,617
--------------
TOTAL U.S. TREASURY NOTES 2,450,123
--------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
(GNMA) (3.2%)
7.000% 03/15/2028 929,748 941,221
--------------
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS (27.4%)
FHLMC (12.2%)
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1382 CL. E
6.500% 10/15/2016 87,141 86,977
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1543 CL. XN
7.000% 07/15/2023 265,000 274,217
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1958 CL. C
0.000% 07/15/1998 80,800 80,266
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1570 CL. D
0.000% 03/15/2000 440,526 416,618
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1747 CL. C
6.750% 10/15/2013 179,021 178,740
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1721 CL. C
6.000% 01/15/2015 3,844 3,836
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1767 CL. H
7.500% 09/15/2022 900,000 944,945
FHLMC GNMA MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 40 CL. N
6.500% 05/17/2021 900,000 888,268
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1900 CL. M
7.500% 08/15/2024 400,000 412,432
FHLMC MULTICLASS MTG. PARTN. CTFS.
GTD. SERIES 1932 CL. B
7.000% 06/15/2025 280,000 283,021
--------------
3,569,320
--------------
2
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
U.S. GOVERNMENT, FEDERAL AGENCY
OBLIGATIONS (CONTINUED)
FNMA (8.7%)
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1993-241 CL. PE
0.000% 10/25/1999 $ 325,000 $ 304,378
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. SERIES 1997-38 CL. L
7.500% 02/17/2012 271,071 272,277
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. SERIES 1997-G5 CL. AC
7.500% 10/17/2017 335,324 339,426
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-G5 CL. VD
7.250% 04/17/2010 505,000 523,252
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-51 CL. B
7.500% 04/18/2011 202,703 202,928
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-63 CL. PH
7.000% 07/18/2026 480,000 493,338
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-74 CL. D
7.500% 09/20/2023 420,000 428,714
--------------
2,564,313
--------------
GNMA (2.3%)
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-4 CL. M
7.500% 02/16/2012 191,303 193,362
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-11 CL. M
8.000% 05/16/2024 470,000 488,763
--------------
682,125
--------------
OTHER AGENCY (4.2%)
RYLAND ACCEPTANCE CORP. FOUR
SERIES 26 CL. C
9.000% 12/01/2016 191,391 195,663
WESTAM MORTGAGE FINANCIAL CORP.
SERIES 10 CL. C
0.000% 02/26/2002 1,124,683 1,042,320
--------------
1,237,983
--------------
TOTAL AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS 8,053,741
--------------
3
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
U.S. GOVERNMENT, FEDERAL AGENCY
OBLIGATIONS (CONTINUED)
OTHER GOVERNMENT AGENCY (9.1%)
A.I.D., MOROCCO FLOATING RATE
5.844% 05/01/2023 $ 400,000 $ 396,000
SMALL BUSINESS ADMINISTRATION
POOL #503401
6.250% 07/25/2021 315,059 316,634
SMALL BUSINESS ADMINISTRATION
POOL #503486
6.125% 10/25/2021 253,576 256,429
SMALL BUSINESS ADMINISTRATION
POOL # 503564
6.250% 11/25/2021 391,122 396,989
SMALL BUSINESS ADMINISTRATION
POOL #503675
6.125% 03/25/2022 398,655 403,140
SMALL BUSINESS ADMINISTRATION
POOL #503799
6.125% 06/25/2022 883,562 893,502
--------------
TOTAL OTHER GOVERNMENT AGENCY 2,662,694
--------------
TOTAL U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS
(COST $14,161,715) 14,107,779
--------------
OTHER SECURITIZED LOANS (19.3%)
ASSET BACKED SECURITIES (7.8%)
HOME EQUITY LOAN RECEIVABLES (6.6%)
ABFS MORTGAGE LOAN TRUST
SERIES 1997-2 CL. A-5
7.125% 01/15/2029 300,000 304,337
AFC HOME EQUITY LOAN TRUST
SERIES 1993-1 CL. A
5.900% 05/20/2008 893,696 883,888
CITYSCAPE HOME EQUITY LOAN TRUST
SERIES 1997-B CL. A7
7.410% 5/25/2028 320,000 328,523
GREEN TREE HOME IMPROVEMENT LOAN TRUST
SERIES 1996-C CL. HEA2
7.100% 06/15/2027 290,661 292,477
TMS HOME EQUITY LOAN TRUST
SERIES 1995-A CL. A2
7.925% 02/15/2014 5,774 5,767
--------------
1,814,992
--------------
4
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
OTHER SECURITIZED LOANS (CONTINUED)
MANUFACTURED HOUSING RECEIVABLES (0.1%)
GREEN TREE FINANCIAL CORP.
SERIES 1994-7 CL. A-3
8.000% 03/15/2020 $ 142,028 $ 142,639
--------------
OTHER ASSET BACKED SECURITIES (1.1%)
SLM STUDENT LOAN TRUST
SERIES 1996-4 CL. A1
5.553% 07/25/2004 329,767 328,773
--------------
TOTAL ASSET BACKED SECURITIES 2,286,404
--------------
COLLATERALIZED MORTGAGE OBLIGATIONS (11.5%)
RESIDENTIAL ASSET SECURITIZATION
TRUST SERIES 1996-A8 CL. A3
8.000% 12/25/2026 970,000 1,004,453
GE CAPITAL MORTGAGE SERVICES, INC.
SERIES 1997-8 CL. A6
7.250% 10/25/2027 325,000 332,794
GE CAPITAL MORTGAGE SERVICES, INC.
SERIES 1997-8 CL. A7
7.250% 10/25/2027 943,007 947,149
NORWEST ASSET SECURITIES CORP.
SERIES 1997-16 CL. A2
6.750% 10/25/2027 660,000 658,630
PNC MORTGAGE SECURITIES CORP.
SERIES 1997-4 CL. IIPP-2
7.500% 07/25/2027 280,000 287,913
STRUCTURED ASSET SECURITIES
SERIES 1997-4 CL. A2
7.000% 12/25/2027 140,000 141,561
--------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS 3,372,500
--------------
TOTAL OTHER SECURITIZED LOANS
(COST $5,689,698) 5,658,904
--------------
CORPORATE BONDS (27.7%)
INDUSTRIAL (5.3%)
COCA-COLA ENTERPRISES, INC.
6.375% 08/01/2001 800,000 806,952
PHILIP MORRIS
6.150% 03/15/2000 450,000 449,451
5
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
CORPORATE BONDS (CONTINUED)
SERVICE CORP. INTERNATIONAL
6.300% 03/15/2003 $ 300,000 $ 298,533
--------------
TOTAL INDUSTRIAL 1,554,936
--------------
FINANCIAL (18.9%)
BANKAMERICA CORP.
5.687% 02/20/2002 480,000 478,512
BEAR STEARNS CO., INC.
6.125% 02/01/2003 250,000 247,942
BEAR STEARNS CO., INC.
5.724% 10/10/2000 500,000 498,125
CIT GROUP HOLDINGS, INC.
6.375% 11/15/2002 525,000 528,418
EOP OPERATING L.P. (144A)
6.376% 02/15/2012 700,000 696,759
FORD MOTOR CREDIT CO.
6.500% 02/28/2002 300,000 303,021
GENERAL ELECTRIC CAPITAL CORP.
MEDIUM TERM NOTES
6.350% 09/15/2001 750,000 762,983
GENERAL MOTORS ACCEPTANCE CORP.
MEDIUM TERM NOTES
7.500% 08/05/1999 500,000 509,840
INTERNATIONAL LEASE FINANCE CORP.
7.000% 05/15/2000 525,000 534,382
MORGAN STANLEY GROUP, INC.
MEDIUM TERM NOTES
5.750% 02/15/2001 550,000 544,819
SALOMON, INC.
6.750% 02/15/2003 450,000 459,009
--------------
TOTAL FINANCIAL 5,563,810
--------------
YANKEE (3.5%)
MANITOBA PROVINCE CDA SERIES BT
9.500% 09/15/1998 1,000,000 1,013,450
--------------
TOTAL CORPORATE BONDS
(COST $8,175,292) 8,132,196
--------------
TOTAL INVESTMENTS, EXCLUDING TEMPORARY
CASH INVESTMENT
(COST $28,026,705) 27,898,879
--------------
6
<PAGE>
- -------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
SCHEDULE OF INVESTMENTS
- -------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE (1)
-------------- --------------
<S> <C> <C>
REPURCHASE AGREEMENT (3.8%)
GOLDMAN SACHS CORP.
5.414% DATED 04/30/1998,
DUE 05/01/1998 IN THE
AMOUNT OF $1,133,701.
COLLATERALIZED BY U.S. TREASURY NOTES
6.125% TO 6.500% DUE 10/15/2006 TO 08/15/2007
(COST $1,133,533) $ 1,133,533 $ 1,133,533
--------------
TOTAL INVESTMENTS (98.8%)
(COST $29,160,238) 29,032,412
RECEIVABLES LESS LIABILITIES (1.2%) 348,493
--------------
NET ASSETS (100.0%) $ 29,380,905
==============
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part of the financial statements.
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
STATEMENT OF ASSETS AND LIABILITIES
- ------------------------------------------------------------------------------------------------
April 30, 1998
(Unaudited)
<S> <C>
ASSETS:
Investments at identified cost ............................................ $ 28,026,705
- ----------------------------------------------------------------------------- ----------------
Investments at value (Notes 1 and 2)....................................... $ 27,898,879
Temporary cash investment, at cost (Note 1)................................ 1,133,533
Receivable for:
Interest................................................................. 228,926
Investments sold......................................................... 125,494
----------------
Total assets............................................................... 29,386,832
----------------
LIABILITIES:
Payable for:
Investment management fee (Note 4)....................................... 5,927
----------------
Net assets applicable to outstanding shares................................ $ 29,380,905
================
Net assets consist of:
Unrealized depreciation on investments................................... $ (127,826)
Undistributed net realized loss from investments......................... (22,287)
Capital paid in (Note 3)................................................. 29,531,018
----------------
$ 29,380,905
================
Shares of capital stock outstanding (Note 3)................................. 2,460,323
================
Net asset value, offering and
redemption price per share (1)............................................ $ 11.94
================
(1) The net asset value per share is computed by dividing net assets
applicable to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
STATEMENT OF OPERATIONS
- ------------------------------------------------------------------------------------------------
For the period from inception of operations, February 2, 1998 to April 30, 1998
(Unaudited)
<S> <C>
INVESTMENT INCOME:
Income:
Interest............................................................ $ 478,332
----------------
Expenses:
Investment management fees (Note 4)................................. 18,300
Shareholder servicing costs (Note 4)................................ 4,500
Financial information and subscriptions............................. 1,500
Custodian fees...................................................... 300
Bank transaction and checking fees.................................. 900
Legal, insurance, auditing fees and other........................... 5,897
----------------
31,397
Expenses reimbursed by investment adviser (1)....................... (13,097)
----------------
Total expenses.................................................. 18,300
----------------
Net investment income (Note 1).......................................... 460,032
----------------
Realized loss and unrealized depreciation from
investment transactions:
Net realized loss from investments (Note 2)............................. (22,287)
Net unrealized depreciation on investments during the period (Note 1)... (127,826)
----------------
Net loss on investments (Note 1)........................................ (150,113)
----------------
Net increase in net assets resulting from operations.................... $ 309,919
================
(1) The Adviser has voluntarily agreed to assume ordinary expenses of the Fund,
to the extent that these expenses, together with the Fund's advisery fee,
exceed .25% of the Fund's average net assets.
The accompanying notes are an integral part of the financial statements.
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
STATEMENTS OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------------------------------
Six Months
Ended
April 30, 1998
(Unaudited)(1)
--------------
<S> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment income ............................................. $ 460,032
Net realized loss from investments (Note 2)........................ (22,287)
Change in net unrealized depreciation on investments............... (127,826)
--------------
Net increase in net assets resulting from operations............... 309,919
Distributions to shareholders:
From net investment income......................................... (460,032)
Capital share transactions, net (Note 3)............................... 29,531,018
--------------
Net increase in net assets......................................... 29,380,905
NET ASSETS:
Beginning of period.................................................... -
--------------
End of period ......................................................... $ 29,380,905
==============
(1) From inception of operations on February 2, 1998.
The accompanying notes are an integral part of the financial statements.
</TABLE>
10
<PAGE>
- --------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. Significant accounting policies:
CMC Short Term Bond Fund (the Fund) is a portfolio of CMC Fund Trust (the
Trust), an open-end diversified investment company registered under the
Investment Company Act of 1940, as amended. The Trust has established three
other portfolios, CMC Small Cap Fund, CMC International Stock Fund and CMC High
Yield Fund, which are not included in this financial statement. Each portfolio
issues a separate series of the Trust's shares and maintains a separate
investment portfolio. The policies described below are consistently followed by
the Fund for the preparation of its financial statements in conformity with
generally accepted accounting principles.
Investment valuation - The Fund's investments are carried at values deemed
best to reflect their fair values as determined in good faith by or under the
supervision of the Trustees. These values are based on market value as quoted by
dealers who are market makers in these securities or by an independent pricing
service unless circumstances indicate that another method of determining fair
value should be considered. Market values are based on the average of bid and
ask prices, or by reference to other securities with comparable ratings,
interest rates and maturities. Temporary investments in short-term securities,
principally repurchase agreements, are valued at cost, which approximates
market.
Shareholder distributions - The Fund distributes net investment income
monthly and any net realized gains from investment transactions annually.
Distributions to shareholders are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for net
operating losses and deferral of losses from wash sales.
Use of estimates - The preparation of the financial statements in
accordance with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of income and expenses during
the reporting period. Actual results could differ from those estimates.
Federal income taxes - The Fund has made no provisions for federal income
taxes on net investment income or net realized gains from sales of investment
securities, since it is the intention of the Fund to comply with the provisions
of the Internal Revenue Code available to certain regulated investment
companies, and to make distributions of income and security profits sufficient
to relieve it from substantially all federal income taxes.
Other - Investment transactions are accounted for on the date the
investments are purchased or sold. The cost of investments sold is determined by
the use of the specific identification method for both financial reporting and
income tax purposes. Interest income is recorded on the accrual basis.
Amortization of discount or premium is recorded over the life of the respective
instrument. Realized gains and losses from investment transactions and
unrealized appreciation or depreciation of investments are reported on the basis
of identified costs.
The Fund, through its custodian, receives delivery of underlying
securities collateralizing repurchase agreements (included in temporary cash
investments). Market values of these securities are required to be at least 100%
of the cost of the repurchase agreement. The Fund's investment adviser
determines that the value of the underlying securities is at all times at least
equal to the resale price. In the event of default or bankruptcy by the other
party to the agreement, realization and/or retention of the collateral may be
subject to legal proceedings.
11
<PAGE>
- --------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
2. Investment transactions:
Aggregate purchases, sales and maturities, net realized loss and net unrealized
depreciation of investments, excluding temporary cash investments, as of and for
the period ended April 30, 1998, were as follows:
<TABLE>
<CAPTION>
<S> <C>
Purchases:
Investment securities other than U.S. Government obligations.............. $ 18,687,072
U.S. Government obligations............................................... 24,099,540
-------------------
Total purchases...................................................... $ 42,786,612
===================
Sales and Maturities:
Investment securities other than U.S. Government obligations.............. $ 4,814,291
U.S. Government obligations............................................... 9,936,701
-------------------
Total sales and maturities........................................... $ 14,750,992
===================
Net Realized Loss:
Investment securities other than U.S. Government obligations.............. $ (7,792)
U.S. Government obligations............................................... (14,495)
-------------------
Total net realized loss.............................................. $ (22,287)
===================
Unrealized Appreciation (Depreciation) as of April 30, 1998:
Appreciation............................................................... $ 32,095
Depreciation............................................................... (159,921)
-------------------
Net unrealized depreciation.......................................... $ (127,826)
===================
Unrealized Appreciation (Depreciation) for federal income tax purposes as of
April 30, 1998:
Appreciation............................................................... $ 32,095
Depreciation............................................................... (159,921)
-------------------
Net unrealized depreciation.............................................. $ (127,826)
===================
For federal income tax purposes, the cost of
investments owned at April 30, 1998.............................................$ 28,026,705
===================
</TABLE>
3. Capital Stock:
<TABLE>
<CAPTION>
Six Months Ended
April 30, 1998 (1)
------------------
<S> <C>
Shares:
Shares sold............................................... 2,987,285
Shares issued for reinvestment of dividends............... 38,529
--------------
3,025,814
Less shares redeemed...................................... (565,491)
--------------
Net increase in shares.................................... 2,460,323
==============
Amounts:
Sales..................................................... $ 35,831,058
Reinvestment of dividends................................. 460,032
--------------
36,291,090
Less redemptions.......................................... (6,760,072)
--------------
Net increase.............................................. $ 29,531,018
==============
Capital stock authorized (shares) 100,000,000
(1) From inception of operations on February 2, 1998.
</TABLE>
12
<PAGE>
- --------------------------------------------------------------------------------
CMC SHORT TERM BOND FUND
A Portfolio of CMC Fund Trust
NOTES TO FINANCIAL STATEMENTS, CONTINUED
- --------------------------------------------------------------------------------
4. Transactions with affiliates and related parties:
<TABLE>
<CAPTION>
<S> <C>
Investment management fees incurred.......................................... $ 18,300
Investment management fee computation basis
(percentage of daily net assets per annum)................................. 0.25.of.1%
Transfer agent fee (included in shareholder
servicing costs)........................................................... $ 4,500
Fees earned by trustees not affiliated with the Fund's
investment adviser or transfer agent (included in other expenses).......... $ 383
</TABLE>
The investment adviser of the Fund is Columbia Management Co. (CMC). In addition
to the investment management fee, each shareholder enters into a written
Administrative Services Agreement with CMC for an annual fee ranging between
0.00% and 0.20%, depending on the size of the investment in the Fund. CMC
provides each shareholder specialized reports regarding the Fund, performance of
the shareholders investments, market conditions and economic indicators.
The transfer agent for the Fund is Columbia Trust Company (CTC), an affiliate of
CMC. The transfer agent is compensated based on a per account fee or a minimum
of $1,500 per month. The contracts for investment advisory and transfer agent
services must be renewed annually by a majority vote of the Fund's shareholders
or by the Trustees of CMC Fund Trust (the Trust).
On December 10, 1997, CMC, CTC and certain of their affiliates were acquired by
Fleet Financial Group, Inc. (Fleet), a publicly owned multi-bank holding company
registered under the Bank Holding Company Act of 1956. Prior to that date,
certain officers and trustees of the Trust were also officers and directors of
CMC and CTC. Those individuals did not receive any compensation or other payment
from the Trust. Following the transaction and as a result of federal banking
regulations, no officers or trustees of the Trust are officers or directors of
CMC or CTC. J. Jerry Inskeep, Jr., an officer and trustee of the Trust, is
affiliated with Fleet, but received no compensation or other payments from the
Trust.
13
