<PAGE> 1
June 19, 1995
Dear Fellow Shareholder:
It is my pleasure to provide you with the initial semi-annual report for
Heritage Series Trust -- Value Equity Fund for the period from inception on
December 30, 1994 to April 30, 1995. For this period, the "A" shares of your
Fund had a total return of +11.20% (calculated without the imposition of a
front-end sales charge). At the beginning of April, your Fund began offering "C"
shares. For the month of April, the "C" shares had a total return of +4.13%.
From your Fund's inception to the end of April and for the month of April, the
Standard & Poor's 500 Composite Stock Price Index appreciated by 12.97% and
2.94%, respectively.
Chris Bertelsen, the portfolio manager for your fund, has over 25 years of
investment management experience. He is a senior vice president of Eagle Asset
Management, Inc., your Fund's investment subadviser. Chris follows a value
approach to investing, focusing on stocks with at least one of the following
attributes:
- low price in relation to the issuer's earnings or book value
- high dividend yield
- high value of the issuer as a going concern
- low debt.
You may find more information on each of these in the prospectus for your Fund.
Thank you for making a commitment to our new Value Equity Fund. On behalf of all
of us at Heritage, we look forward to helping to serve your investment needs for
years to come.
Sincerely,
Stephen G. Hill
President
<PAGE> 2
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
INVESTMENT PORTFOLIO
APRIL 30, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
-----------
<S> <C>
REPURCHASE AGREEMENT--9.3%(A)
Repurchase Agreement with State Street Bank & Trust Company, dated April 28, 1995, @ 5.87%, to be
repurchased at $485,237 on May 1, 1995, collateralized by $490,000 United States Treasury Notes,
6.875%, due March 31, 1997 (market value $499,851) (cost $485,000).................................. $ 485,000
-----------
COMMON STOCKS--93.7%(A)
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ------------------
<C> <S> <C>
AEROSPACE--0.8%
800 Boeing Company..................................................................... 44,000
-----------
BANKING--2.8%
1,000 Bank Of New York Company Inc....................................................... 32,875
900 Bankers Trust New York Corporation................................................. 48,825
1,500 Fleet Financial Group, Inc......................................................... 49,125
300 National Westminster Bank PLC-ADR.................................................. 15,713
-----------
146,538
-----------
BEVERAGES--1.2%
1,500 Pepsico Inc ....................................................................... 62,438
-----------
BUILDING MATERIALS--0.4%
600 Texas Industries Inc............................................................... 22,575
-----------
CHEMICALS--2.0%
800 ARCO Chemical Company.............................................................. 37,200
400 B.F. Goodrich Company*............................................................. 18,650
800 Minnesota Mining & Manufacturing Company........................................... 47,700
-----------
103,550
-----------
CONGLOMERATE--0.7%
2,000 Hanson PLC-ADR..................................................................... 38,000
-----------
COSMETICS/TOILETRIES--2.8%
1,300 Avon Products, Inc................................................................. 82,225
1,500 Tambrands Inc...................................................................... 62,438
-----------
144,663
-----------
DATA PROCESSING--13.8%
600 America Online Inc.*............................................................... 27,825
1,600 Apple Computer Inc................................................................. 61,200
1,200 Bay Networks Inc.*................................................................. 43,650
1,200 Cisco Systems Inc.*................................................................ 47,850
500 Cognex Corporation*................................................................ 15,000
2,000 Compaq Computer Corporation*....................................................... 76,000
4,500 Conner Peripherals, Inc.*.......................................................... 47,813
2,200 Corel Corporation*................................................................. 30,525
800 Electronic Arts, Inc.*............................................................. 18,400
3,000 EMC Corporation*................................................................... 59,250
1,400 Hutchinson Technology, Inc.*....................................................... 46,200
1,000 Microsoft Corporation*............................................................. 81,750
2,000 National Semiconductor Corporation*................................................ 45,750
1,450 Novell Inc.*....................................................................... 31,537
240 Read-Rite Corporation*............................................................. 5,100
600 Seagate Technology Inc.*........................................................... 19,125
600 Standard Microsystems Corporation*................................................. 11,138
400 Sybase Inc.*....................................................................... 9,700
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE> 3
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
INVESTMENT PORTFOLIO
APRIL 30, 1995
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- ------------------ -----------
<C> <S> <C>
230 Texas Instruments Inc.............................................................. $ 24,380
1,000 Western Digital Corporation*....................................................... 16,000
-----------
718,193
-----------
DRUGS--7.0%
100 American Home Products Corporation................................................. 7,713
600 Amgen Inc.*........................................................................ 43,612
900 Beckman Instruments Inc............................................................ 24,525
900 Bristol-Myers Squibb Company....................................................... 58,612
300 Eli Lilly & Company................................................................ 22,425
1,000 Johnson & Johnson.................................................................. 65,000
900 Merck & Company, Inc............................................................... 38,588
1,500 Upjohn Company..................................................................... 54,375
600 Warner-Lambert Company............................................................. 47,850
-----------
362,700
-----------
ELECTRONICS--11.8%
2,000 American Power Conversion Corporation*............................................. 34,000
700 AMP Inc............................................................................ 29,925
500 Arrow Electronics Inc.............................................................. 23,250
500 Atmel Corporation*................................................................. 22,000
1,000 C-Cube Microsystems Inc.*.......................................................... 22,250
1,500 Dallas Semiconductor Corporation................................................... 30,000
1,200 Electro Scientific Industries Inc.*................................................ 31,950
600 First Alert Inc.*.................................................................. 7,425
700 General Electric Company........................................................... 39,200
600 Integrated Device Technology, Inc.*................................................ 22,875
600 Intel Corporation.................................................................. 61,425
1,000 Lam Research Corporation*.......................................................... 50,500
1,000 Lattice Semiconductor Corporation*................................................. 30,125
300 Microchip Technology Inc.*......................................................... 8,475
300 Motorola Inc....................................................................... 17,063
2,300 Polaroid Corporation............................................................... 78,200
1,070 Tech-Sym Corporation............................................................... 27,017
500 VLSI Technology Inc.*.............................................................. 10,656
4,500 Westinghouse Electric Corporation.................................................. 67,500
-----------
613,836
-----------
FINANCE--4.9%
1,700 American Express Company........................................................... 59,075
400 Federal National Mortgage Association.............................................. 35,300
400 J.P. Morgan & Company.............................................................. 26,250
1,000 Merrill Lynch & Company............................................................ 45,500
300 Morgan Stanley Group Inc........................................................... 20,850
1,600 Student Loan Marketing Association................................................. 64,800
-----------
251,775
-----------
FOOD--7.0%
600 Campbell Soup Company.............................................................. 30,750
2,700 Chiquita Brands International...................................................... 36,112
1,500 Dole Food Company.................................................................. 44,813
900 H.J. Heinz Company................................................................. 37,800
1,500 McDonald's Corporation............................................................. 52,500
650 Philip Morris Companies, Inc....................................................... 44,037
950 Quaker Oats Company................................................................ 34,081
1,100 RJR Nabisco Holdings Corporation................................................... 30,113
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 4
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
INVESTMENT PORTFOLIO
APRIL 30, 1995
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- ------------------ -----------
<C> <S> <C>
1,000 Universal Corporation.............................................................. $ 22,875
1,000 UST Inc............................................................................ 28,125
-----------
361,206
-----------
HEALTH CARE SERVICES--1.3%
3,000 Tenet Healthcare Corporation....................................................... 51,000
900 Physician Corporation of America*.................................................. 16,088
-----------
67,088
-----------
HOUSEHOLD PRODUCTS--0.4%
1,200 Maytag Corporation................................................................. 20,700
-----------
INSURANCE--0.9%
700 Hartford Steam Boiler Inspection & Insurance Company............................... 30,975
400 EXEL Limited....................................................................... 18,200
-----------
49,175
-----------
LEISURE/AMUSEMENT--0.7%
700 The Walt Disney Company............................................................ 38,763
-----------
MEDICAL PRODUCTS & SUPPLIES--1.6%
700 C.R. Bard, Inc..................................................................... 20,387
1,100 Bausch & Lomb Inc.................................................................. 42,625
500 Baxter International Inc........................................................... 17,375
-----------
80,387
-----------
OFFICE EQUIPMENT--1.0%
1,400 Pitney-Bowes Inc................................................................... 51,975
-----------
OIL & GAS--14.9%
900 Amoco Corporation.................................................................. 59,063
600 Anadarko Petroleum Corporation..................................................... 24,675
600 Apache Corporation................................................................. 16,200
800 Atlantic Richfield Company......................................................... 91,600
500 Burlington Resources Inc........................................................... 19,562
1,250 Chevron Corporation................................................................ 59,219
800 Dresser Industries Inc............................................................. 17,500
1,000 Exxon Corporation.................................................................. 69,625
900 Mobil Corporation.................................................................. 85,388
3,400 Occidental Petroleum Corporation................................................... 78,200
1,000 Pennzoil Company................................................................... 48,875
1,900 Phillips Petroleum Company......................................................... 66,500
500 Royal Dutch Petroleum Company, Sponsored ADR....................................... 62,000
1,000 Texaco Inc......................................................................... 68,374
400 YPF, Sponsored ADR................................................................. 8,100
-----------
774,881
-----------
POLLUTION CONTROL--1.6%
1,200 Browning-Ferris Industries, Inc.................................................... 39,600
1,500 WMX Technologies Inc............................................................... 40,875
-----------
80,475
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 5
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
INVESTMENT PORTFOLIO
APRIL 30, 1995
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- ------------------ -----------
<C> <S> <C>
PUBLISHING AND/OR BROADCASTING--3.3%
1,400 Dun & Bradstreet Corporation....................................................... $ 72,974
1,500 Deluxe Corporation................................................................. 46,313
500 Gannett Company.................................................................... 26,312
400 Tribune Company.................................................................... 23,650
-----------
169,249
-----------
REAL ESTATE--1.3%
1,200 Meditrust, SBI, REIT............................................................... 36,600
700 Nationwide Health Prop. Inc., REIT................................................. 25,288
400 Real Estate Investment Trust, REIT................................................. 6,300
-----------
68,188
-----------
RETAIL--1.9%
1,200 Barnes & Noble Inc.*............................................................... 34,350
1,500 Toys R Us, Inc.*................................................................... 37,875
1,000 Wal-Mart Stores Inc................................................................ 23,750
-----------
95,975
-----------
SECURITIES--2.1%
800 A.G. Edwards, Inc.................................................................. 18,300
2,500 Salomon Inc........................................................................ 90,313
-----------
108,613
-----------
TELECOMMUNICATIONS--5.0%
400 BellSouth Corporation.............................................................. 24,500
3,000 Comsat Corporation................................................................. 60,000
500 GTE Corporation.................................................................... 17,063
1,400 Hong Kong Telecom Limited, Sponsored ADR........................................... 27,300
1,000 Nynex Corporation.................................................................. 40,875
1,000 Pacific Telesis Group.............................................................. 30,875
400 SBC Communications, Inc............................................................ 17,650
530 US Robotics Corporation*........................................................... 42,000
-----------
260,263
-----------
TEXTILES--0.1%
400 Shaw Industries Inc................................................................ 5,250
-----------
TRANSPORTATION--2.4%
600 CSX Corporation.................................................................... 47,775
1,200 Comair Holdings Inc................................................................ 30,225
1,400 Illinois Central Corporation....................................................... 49,175
-----------
127,175
-----------
Total common stocks (cost $4,548,998).................................................................. 4,867,631
-----------
TOTAL INVESTMENT PORTFOLIO (cost $5,033,998)(b) 103%(a)................................................ 5,352,631
OTHER ASSETS AND LIABILITIES, NET (3.0%)(a)............................................................ (158,004)
-----------
NET ASSETS, 100.0%..................................................................................... $ 5,194,627
==========
</TABLE>
- ------------------
* Not an income-producing security.
(a) Percentages indicated are based on net assets.
(b) The aggregate identified cost for federal income tax purposes is the same.
Market value includes net unrealized appreciation of $318,633, which
consists of aggregate gross unrealized appreciation for all securities in
which there is an excess of market value over tax cost of $372,933 and
aggregate gross unrealized depreciation for all securities in which there
is an excess of tax cost over market value of $54,300.
ADR -- American Depository Receipt.
The accompanying notes are an integral part of the financial statements.
5
<PAGE> 6
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Assets
Investments, at market value (identified cost $4,548,998) (Note 1)....................... $ 4,867,631
Repurchase agreement (identified cost $485,000) (Note 1)................................. 485,000
Cash..................................................................................... 4,271
Receivables:
Investments sold....................................................................... 69,216
Fund shares sold....................................................................... 132,587
Dividends and interest................................................................. 5,513
Deferred organizational expenses (Note 1)................................................ 42,000
-----------
Total assets..................................................................... 5,606,218
Liabilities
Payables (Note 4):
Investments purchased.................................................................. $ 360,484
Accrued expenses....................................................................... 51,107
----------
Total liabilities................................................................ 411,591
-----------
Net assets, at market value.............................................................. $ 5,194,627
==========
Net Assets
Net assets consist of:
Undistributed net investment income.................................................... $ 9,113
Net unrealized appreciation on investments............................................. 318,633
Accumulated net realized gain.......................................................... 36,331
Paid-in capital........................................................................ 4,830,550
-----------
Net assets, at market value.............................................................. $ 5,194,627
==========
Class A Shares
Net asset value and redemption price per share ($4,788,851 divided by 301,292 shares of
beneficial interest outstanding, no par value) (Note 2)................................ $15.89
======
Maximum offering price per share (100/95.25 of $15.89)................................... $16.68
======
Class C Shares
Net asset value and offering price per share ($405,776 divided by 25,526 shares of
beneficial interest outstanding, no par value) (Note 2)................................ $15.90
======
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE> 7
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
STATEMENT OF OPERATIONS
FOR THE PERIOD DECEMBER 30, 1994
(COMMENCEMENT OF OPERATIONS)
TO APRIL 30, 1995
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment Income
Income:
Dividends............................................................................. $ 20,024
Interest.............................................................................. 5,431
------------
Total income.................................................................... 25,455
Expenses (Notes 1 and 4):
Management fee........................................................................ $ 8,143
Custodian/Accounting fees............................................................. 17,871
Professional fees..................................................................... 14,057
Amortization of state registration expenses........................................... 10,000
Reports to shareholders............................................................... 4,333
Shareholder servicing fee............................................................. 3,695
Amortization of organization expenses................................................. 3,000
Distribution fee...................................................................... 2,600
Trustees' fees and expenses........................................................... 2,100
Federal registration fee.............................................................. 1,608
Insurance............................................................................. 860
----------
Expenses before waiver and reimbursement........................................ 68,267
Fees waived by the Manager (Note 4)............................................. (8,143)
Reimbursement from Manager (Note 4)............................................. (43,782) 16,342
---------- ------------
Net investment income................................................................... 9,113
------------
Realized and Unrealized Gain on Investments
Net realized gain from investment transactions.......................................... 36,331
Net increase in unrealized appreciation of investments during the period................ 318,633
------------
Net gain on investments......................................................... 354,964
------------
Net increase in net assets resulting from operations.................................... $ 364,077
===========
</TABLE>
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE PERIOD
DECEMBER 30, 1994
(COMMENCEMENT OF OPERATIONS)
TO APRIL 30, 1995
(UNAUDITED)
-----------------------------
<S> <C>
Increase in net assets:
Operations:
Net investment income................................................................... $ 9,113
Net realized gain from investment transactions.......................................... 36,331
Net increase in unrealized appreciation of investments during the period................ 318,633
-----------
Net increase in net assets resulting from operations.................................... 364,077
Increase in net assets from Fund share transactions (Note 2).............................. 4,530,550
-----------
Increase in net assets.................................................................... 4,894,627
Net assets, beginning of period (original capital as of December 30, 1994)................ 300,000
-----------
Net assets, end of period (including undistributed net investment income of $9,113)....... $ 5,194,627
=============================
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE> 8
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
FINANCIAL HIGHLIGHTS
(UNAUDITED)
- --------------------------------------------------------------------------------
The following table includes selected data for a share outstanding
throughout the period and other performance information derived from the
financial statements.
<TABLE>
<CAPTION>
CLASS A+ CLASS C++
---------- ----------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF THE PERIOD........................................... $ 14.29 $ 15.27
---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)..................................................... .03 (.00)
Net realized and unrealized gain on investments.................................. 1.57 .63
---------- ----------
Total from investment operations................................................... 1.60 .63
---------- ----------
NET ASSET VALUE, END OF THE PERIOD................................................. $ 15.89 $ 15.90
=========== ===========
TOTAL RETURN (%)(C)(D)............................................................. 11.20 4.13
RATIOS (%)/AND SUPPLEMENTAL DATA:
Ratio of operating expenses, net to average daily net assets(a)(b)............... 1.65 2.40
Ratio of net investment income (loss) to average daily net assets(b)............. .97 (.89)
Portfolio turnover rate(b)....................................................... 33.99 33.99
Net assets, end of period........................................................ $4,788,851 $405,776
</TABLE>
- ---------------
+ For the period December 30, 1994 (commencement of operations) to April 30,
1995.
++ For the period April 3, 1995 (commencement of C shares) to April 30, 1995.
(a) Excludes management fees waived by the Manager of $.16 per share. The
operating expense ratio including such items would be 6.94% and 7.69%,
(annualized), respectively.
(b) Annualized.
(c) Not annualized.
(d) Does not reflect the imposition of a sales charge.
8
<PAGE> 9
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
- --------------------------------------------------------------------------------
Note 1: SIGNIFICANT ACCOUNTING POLICIES. Heritage Series Trust (the "Trust") is
organized as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
management investment company and presently offers shares in three
series, the Value Equity Fund (the "Fund"), Small Cap Stock Fund and
Eagle International Equity Portfolio. The policies described below are
followed by the Fund in the preparation of its financial statements in
conformity with generally accepted accounting principles.
The Fund currently issues Class A and Class C shares. Class A shares are
sold subject to a maximum sales charge of 4.75% of the amount invested
payable at the time of purchase. Class C shares which were offered to
shareholders beginning April 3, 1995 are sold subject to a contingent
deferred sales charge of 1% of the lower of net asset value or purchase
price payable upon any redemptions within one year after purchase.
Security Valuation: The Fund values investment securities at market
value based on the last quoted sales price as reported by the principal
securities exchange on which the security is traded. If no sale is
reported, the last bid price is used and in the absence of a market
quote, securities are valued using such methods as the Board of Trustees
believes would reflect fair market value. Short term investments having
a maturity of 60 days or less are valued at cost which, when combined
with accrued interest included in interest receivable or discount
earned, approximates market.
Repurchase Agreements: The Fund enters into repurchase agreements
whereby the Fund, through its custodian, receives delivery of the
underlying securities, the market value of which at the time of purchase
is required to be in an amount equal to at least 100% of the resale
price.
Federal Income Taxes: The Fund's policy is to comply with the
requirements of the Internal Revenue Code of 1986, as amended, which are
applicable to regulated investment companies and to distribute
substantially all of its taxable income to its shareholders.
Accordingly, no provision has been made for federal income and excise
taxes.
Distribution of Net Realized Gains. Net realized gains from investment
transactions during any particular year in excess of available capital
loss carryforwards, which, if not distributed, would be taxable to the
Fund, will be distributed to shareholders in the following fiscal year.
The Fund uses the identified cost method for determining realized gain
or loss on investments for both financial and federal income tax
reporting purposes.
State Registration Expenses: State registration fees are amortized based
either on the time period covered by the registration or as related
shares are sold, whichever is appropriate for each state.
Organization Expenses: Expenses incurred in connection with the
formation of the Fund were deferred and are being amortized on a
straight-line basis over 60 months from the date of commencement of
operations.
Other: Investment security transactions are accounted for on a trade
date plus one basis. Dividend income and distributions to shareholders
are recorded on the ex-dividend date. Interest income is recorded on the
accrual basis.
Capital Accounts: The Fund reports the undistributed net investment
income (accumulated net investment loss) and accumulated net realized
gain (loss) accounts on a basis approximating amounts available for
future tax distributions (or to offset future taxable realized gains
when a capital loss carryforward is available). Accordingly, the Fund
may periodically make reclasses among certain capital accounts without
impacting the net asset value of the Fund.
Note 2: FUND SHARES. At April 30, 1995, there was an unlimited number of shares
of beneficial interest of no par value authorized. Transactions in
shares of the Fund during the period December 30, 1994 to April 30, 1995
were as follows:
<TABLE>
<CAPTION>
CLASS A SHARES CLASS C SHARES
FOR THE PERIOD FOR THE PERIOD
DECEMBER 30, 1994 APRIL 3, 1995
(COMMENCEMENT OF (COMMENCEMENT OF
OPERATIONS) TO CLASS C SHARES) TO
APRIL 30, 1995 APRIL 30, 1995
--------------------------- -------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ --------- -----------
<S> <C> <C> <C> <C>
Shares sold.......................................... 286,198 $ 4,225,524 25,526 $ 394,836
Shares redeemed...................................... (5,970) (89,810) -- --
---------- ------------ --------- -----------
Net increase......................................... 280,228 $ 4,135,714 25,526 $ 394,836
=========== ==========
Shares outstanding:
Beginning of period................................ 21,064 0
---------- ---------
End of period...................................... 301,292 25,526
========= ========
</TABLE>
9
<PAGE> 10
- --------------------------------------------------------------------------------
HERITAGE SERIES TRUST-VALUE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(CONTINUED)
- --------------------------------------------------------------------------------
Note 3: PURCHASES AND SALES OF SECURITIES. For the period ended April 30, 1995,
purchases and sales of investment securities (excluding repurchase
agreements and short term obligations) aggregated $4,791,628 and
$278,960, respectively.
Note 4: MANAGEMENT, SUBADVISORY, DISTRIBUTION, SHAREHOLDER SERVICING AGENT AND
TRUSTEES' FEES. Under the Fund's Investment Advisory and Administration
Agreement with Heritage Asset Management, Inc. ( the "Manager"), the
Fund agrees to pay to the Manager a fee equal to an annualized rate of
.75% of the Fund's average daily net assets, computed daily and payable
monthly. The agreement also provides for a reduction in such fees in any
year to the extent that operating expenses of the Fund exceed applicable
state expense limitations. Currently, the Manager has voluntarily agreed
to waive its fee and, if necessary reimburse the Fund to the extent that
Fund operating expenses exceed 1.65% on an annual basis of the Fund's
average daily net assets for A Shares and 2.40% for C Shares. These
agreements are more restrictive than any state expense limitation at the
current level of net assets. Expenses reimbursed are recoverable by the
Manager for a period of up to two years. Under the Agreement, management
fees waived and expenses reimbursed totaled $51,925 ($.16 per share)
during the period ended April 30, 1995.
The Manager is also the Dividend Paying and Shareholder Servicing Agent
for the Portfolio. The amount payable to the Manager for such expenses
as of April 30, 1995 was $3,695. In addition, the Manager performs Fund
Accounting services and charged $8,155 during the current period which
was also payable as of April 30, 1995.
The Manager has entered into an agreement with Eagle Asset Management,
Inc. (the "Subadviser") for the Subadviser to provide to the Fund
investment advice, portfolio management services including the placement
of brokerage orders, and certain compliance and other services for a fee
payable by the Manager equal to 50% of the fees payable by the Fund to
the Manager without regard to any reduction due to the imposition of
expense limitations.
Pursuant to a plan adopted in accordance with Rule 12b-1 of the
Investment Company Act of 1940, as amended, the Fund is authorized to
pay Raymond James & Associates, Inc. (the "Distributor") a fee pursuant
to the Class A Distribution Plan of up to 0.35% of average daily net
assets for the services it provides in connection with the promotion and
distribution of Fund shares. However, at the present time the Board of
Trustees has authorized payments of only .25% of average daily net
assets. The Class C Distribution Plan provides for payments at an annual
rate of up to 1.00% of the average daily net assets. The Distributor may
retain the first 12 months distribution fee for reimbursement of amounts
paid to the broker/dealer at the time of purchase. Such fees are accrued
daily and payable monthly. During the period $2,407 and $193 were paid
for distribution fees for Class A shares and Class C shares,
respectively. The Manager, the Subadviser, the Distributor and the
Shareholder Servicing Agent are all wholly-owned subsidiaries of Raymond
James Financial, Inc.
Trustees of the Trust also serve as Trustees for Heritage Cash Trust,
Heritage Capital Appreciation Trust, Heritage Income-Growth Trust,
Heritage Income Trust and Heritage U.S. Government Income Fund,
investment companies which are also advised by the Manager (collectively
referred to as the Heritage funds). Each Trustee of the Heritage funds
who is not an interested person of the Manager received an annual fee of
$8,000 and an additional fee of $2,000 for each combined quarterly
meeting of the Heritage funds attended. Trustees' fees and expenses are
paid equally by each of the Heritage funds.
10
<PAGE> 11
HERITAGE SERIES TRUST-VALUE EQUITY FUND is a member of the Heritage family of
mutual funds. Other investment alternatives available to you from Heritage
include:
- HERITAGE CASH TRUST
MONEY MARKET FUND
MUNICIPAL MONEY MARKET FUND
- HERITAGE CAPITAL APPRECIATION TRUST
- HERITAGE INCOME-GROWTH TRUST
- HERITAGE INCOME TRUST
DIVERSIFIED PORTFOLIO
LIMITED MATURITY GOVERNMENT PORTFOLIO
INSTITUTIONAL GOVERNMENT PORTFOLIO
- HERITAGE SERIES TRUST
SMALL CAP STOCK FUND
- HERITAGE U.S. GOVERNMENT INCOME FUND
(A CLOSED-END FUND THAT TRADES ON THE
NEW YORK STOCK EXCHANGE)
We are pleased that many of you are also investors in these funds. For
information and a prospectus for any of these funds, please contact your account
executive. Read the Prospectus carefully before you invest in any of the funds.
11
<PAGE> 12
(LOGO)
HERITAGE
SERIES TRUST(TM)
VALUE EQUITY FUND
A MUTUAL FUND
SEEKING LONG-TERM
CAPITAL APPRECIATION
SEMIANNUAL REPORT
(Unaudited) and Investment
Performance Review for the
Period From December 30, 1994
(Commencement of Operations) to
APRIL 30, 1995
A member of the
Heritage Family of Mutual Funds(TM)
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Heritage Series Trust ----------------
P.O. Box 33022
St. Petersburg, FL 33733
- --------------------------------- BULK RATE
U.S. POSTAGE
Address Change Requested PAID
PERMIT NO. 39
Semiannual Report ATLANTA, GA
INVESTMENT ADVISOR/ ----------------
SHAREHOLDER SERVICING AGENT
Heritage Asset Management, Inc.
P.O. Box 33022
St. Petersburg, FL 33733
(800) 421-4184
DISTRIBUTOR
Raymond James & Associates, Inc.
P.O. Box 12749
St. Petersburg, FL 33733
(813) 573-3800
LEGAL COUNSEL
Kirkpatrick & Lockhart LLP
This report is for the information of shareholders of
Heritage Series Trust. It may also be used as sales
literature when preceded or accompanied by a prospectus.
6M 6/95
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