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Previous: RUPAY BARRINGTON FUNDS INC, N-30D, 1999-09-03 |
Next: DEFINED ASSET FUNDS MUNICIPAL INVT TR FD INTERM TERM SER 256, 497, 1999-09-03 |
The Rupay-Barrington Value Equity Fund
Report from Nelson J. Kjos, Portfolio Manager
Dear Shareholders:
The Rupay-Barrington Value Equity Fund has paid its first cash dividend
of 5 cents per share at the end of June, 1999. The Fund had a total of 84 stocks
in the portfolio. Net assets of $943,832, and a YTD return of 9.0%. The Fund's
top holdings were: Polaroid, Inco Ltd., Champion International, Ashland Inc. and
Public Service of New Mexico. The fund's focus is eclectic. Buying high quality
balance sheets and expected future earnings within a reasonable price range.
Many of you have been with me over thirty years, and if you recall what I wrote
in 1982: The stock market is a business of crises of sudden ups and downs, that
consistently occur...well the second half of 1999 won't be any different. But
prepared we are to discover the best values in the stock market near and far.
Sincerely,
Nelson J. Kjos
Portfolio Manager
July 30, 1999
Rupay-Barrington Value Equity Fund
Schedule of Portfolio
Investments
June 30, 1999
Number (Unaudited)
of Market
Shares Security Description Value
- ------------ ------------------------------- --------------
COMMON STOCK: 61.03%
AEROSPACE: 1.63%
300 AAR Corp $6,805
300 KLM Royal Dutch Air 8,569
-------
-------
15,374
--------
BUILDING CONSTRUCTION: 1.66%
300 Louisiana-Pacific Corp. 7,124
200 York 8,563
--------
--------
15,687
--------
CHEMICALS: 3.20%
300 Airgas* 3,674
300 IMC Global 5,288
300 Lyondell Petrochemical Co. 6,188
600 Schulman A Inc. 10,313
300 Wellman Inc. (a) 4,781
--------
--------
30,244
--------
COMMERCIAL SERVICES: 1.48%
200 Equifax (a) 7,137
300 Manpower 6,788
--------
--------
13,925
--------
COSMETICS: 0.71%
300 Pall Corp 6,656
--------
ELECTRICAL: 2.04%
300 Baldor Electric 5,962
300 LG & E Energy 6,300
300 Scana Corp 7,013
------
------
19,275
-------
ENTERTAINMENT: 0.90%
600 Hilton 8,513
-------
FINANCIAL: 1.52%
300 Pacific Century Financial 6,468
Corp.
100 S & P Midcap 400 SPDRs 7,838
--------
--------
14,306
--------
FOOD PRODUCTS: 4.85%
600 Chiquita Brands Int'l Inc. 5,400
300 Dole Foods Inc. 8,813
300 Fleming Cos Inc. 3,488
300 Imperial Sugar Co. 2,081
300 Group Ind Moseca 2,681
600 Nash Finch Co. 6,056
300 Sanderson Farms 4,275
300 Smuckers Class A 6,675
300 Universal Foods 6,338
--------
--------
45,807
-------
INSURANCE: 3.05%
200 HSB Group Inc. 8,237
600 Meadowbrook Insurance Group 8,175
Inc.
200 Ohio Casulty Corp. 7,225
300 Old Republic Int'l 5,194
--------
28,831
---------
MANUFACTURING: 6.73%
500 Cross (A.T.) Co. 2,780
300 Bairnco Corp 2,250
300 Fila Holdings ADR (a) 3,544
300 Federal Signal (a) 6,356
300 Milacron Inc. 5,550
200 N.C.H. Corp 9,900
300 Olin Corp 3,956
1,000 Pacific Dunlop Ltd 5,750
600 Phillips-Van Heusen (a) 5,925
600 Russell Corp 11,700
300 Timken Co (a) 5,850
--------
63,561
--------
MEDICAL SUPPLIES: 1.08%
300 Angelica 5,287
300 Crawford & Co Class B 4,875
--------
--------
10,162
-------
METALS: 4.27%
300 Asarco 5,644
300 Brush Wellman 5,438
300 Cyprus Minerals Co. 4,519
600 Homestake Mining Co 4,913
900 Inco Ltd (a) 16,200
300 Placer Dome 3,544
--------
--------
40,258
--------
MISCELLANEOUS: 3.43%
300 American Greetings (a) 9,038
200 Fluor Corp (a) 8,100
300 National Presto 11,475
600 Olsten Corp 3,788
---------
---------
32,401
---------
MUTUAL FUND: 0.42%
300 Royce Value Trust 3,975
---------
OFFICE SUPPLIES: 1.27%
300 John Harland & Co (a) 5,981
300 Steelcase Inc. 6,000
-------
-------
11,981
-------
OIL & GAS: 4.06%
300 Ashland Inc. 12,038
300 A G L Res Inc 5,531
200 Kerr-McGee (a) 10,038
300 MCN Energy Group (a) 6,225
300 Penzoil 4,500
-------
-------
38,332
-------
PACKAGING/CONTAINERS: 2.05%
200 Crown Cork and Seal 5,700
300 Longview Fiber Co. 4,688
300 Sonoco Products Co 8,981
--------
--------
19,369
--------
PHARMACEUTICALS: 0.94%
600 OMI Corp 6,600
300 Perrigo* 2,288
--------
--------
8,888
--------
PUBLISHING: 5.74%
200 Dow Jones & Co Inc. (a) 10,613
600 Polaroid Corp (a) 16,575
300 Readers Digest Assn Inc. 11,925
300 Thomas Nelson 3,338
300 Value Line 11,700
--------
--------
54,151
--------
RESTAURANT: 0.55%
300 Cracker Barrel 5,194
----------
RETAIL: 1.30%
300 Borders Group Inc.* 4,744
500 Caseys General Stores 7,500
--------
--------
12,244
-------
TEXTILES: 2.75%
300 Culp Inc. 3,150
300 Champion International 14,363
600 Wolverine World Wide Inc. 8,400
--------
--------
25,913
--------
TRANSPORTATION: 1.62%
300 Alexander & Baldwin Inc. 6,675
200 Browning Ferris (a) 8,600
-------
-------
15,275
-------
UTILITIES: 3.78%
300 Avista Corp. 5,100
300 Green Mountain Power 3,375
300 Hawaiian Electric 10,650
600 Public Service New Mexico (a) 11,925
300 Semco Energy Inc. 4,631
--------
35,681
--------
TOTAL COMMON STOCK: 576,003
--------
(Cost: $549,775 )
Principal
Amount
- -
$354,617 SHORT TERM INVESTMENTS: 37.57%
Firstar Treasury Fund
(Cost: $354,617) 354,617
--------------
TOTAL INVESTMENTS:
(Cost: $904,392)** 98.60% $930,620
Other assets-net 1.40% 13,212
------------------------
========================
NET ASSETS 100.00% $943,832
========================
* Non-income producing securities
**Cost for Federal income tax purpose is $904,392 and net
unrealized appreciation consists of:
Gross unrealized appreciation $30,681
Gross unrealized depreciation (4,453)
---------
==========
Net unrealized appreciation $26,228
==========
SCHEDULE OF CALL OPTIONS WRITTEN CONTRACTS
June 30,
1999 Unrealized
Contract Strike Number of Premium Unaudited Appreciation
Issue Month Price Contracts Received Market (Depreciation)
Value
- --------------- ---------------------------------------------------------
American Greetings Oct-99 30.0 3 $598 $788 ($190)
Aeroquip-Vickers Inc. Aug-99 35.0 2 763 4,550 (3,787)
Browning-Ferris Sep-99 35.0 2 363 1,750 (1,387)
Dow Jones & Co Inc. Sep-99 50.0 2 513 925 (412)
Equifax Inc. Jul-99 35.0 2 1,138 263 875
Federal Signal Corp Nov-99 22.5 3 391 300 91
Fila Holdings Jul-99 10.0 3 394 563 (169)
Fluor Corp Oct-99 40.0 2 363 775 (412)
Harland (John) & Co. Dec-99 20.0 3 279 469 (190)
Inco Ltd Oct-99 17.5 3 373 525 (152)
Kerr-McGee Corp Jul-99 40.0 2 213 2,025 (1,812)
MCN Energy Group Nov-99 22.5 3 316 863 (547)
Phillips-Van Heusen Dec-99 10.0 3 429 469 (40)
Polaroid Corp Jan-00 22.5 3 841 2,025 (1,184)
Polaroid Corp Jan-00 30.0 3 729 938 (209)
Public Service Co of NMJan-00 22.5 3 335 244 91
Timken Co Dec-99 22.5 3 316 281 35
Wellman Inc. Dec-99 15.0 3 635 769 (134)
====================================
48 $8,989 $18,522 ($9,533)
===========
(a) A portion of this security is subject to call options written.
See Note 5.
See Notes to Financial Statements
RUPAY-BARRINGTON VALUE EQUITY FUND
Statement of Assets and Liabilities
June 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
ASSETS
Investments at value (identified cost of $904,392)(Notes 1 & 3) $930,620
Receivable for investments sold $2,314
Dividends and interest receivable 6,976
-------
9,290
Due from investment advisor 31,560
--------
TOTAL ASSETS 971,470
--------
LIABILITIES
Options written at value (proceeds $8,989) 18,522
Payable for investments purchased 3,692
Distributions payable 4,208
Accrued expenses 1,216
-------
TOTAL LIABILITIES 27,638
--------
NET ASSETS $943,832
===========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE ($943,832/84,145 shares outstanding) $11.22
=========
OFFERING PRICE ($11.22x100/95.50) $11.75
=========
At June 30, 1999 there were 50,000,000 shares of $.01 par value stock authorized
and components of net assets are:
Paid in capital $870,783
Undistributed net investment income 501
Undistributed net realized gain on investments 55,853
Net unrealized gain on investments and options 16,695
---------
NET ASSETS $943,832
=========
See Notes to Financial Statements
RUPAY-BARRINGTON VALUE EQUITY FUND Statement of Operations Six months ended June
30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
INVESTMENT INCOME
Income:
Interest $5,000
Dividend 5,917
---------
Total income $10,917
Expenses:
Investment management
fees (Note 2) 2,716
Recordkeeping and administration
services (Note 2) 7,438
Accounting fees 7,778
Transfer agent fees (Note 2) 5,251
Audit fees 4,000
Shareholder servicing and reporting 500
Distribution fees 1,188
Custodian fees (Note 3) 3,030
Registration fees 533
----------
Total expenses 32,434
Expenses reimbursed or waived (25,879)
Custody fee credits (Note 3) (274)
---------
Net expenses 6,281
-----------
Net investment income 4,636
----------
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Net realized appreciation on investments and options 55,853
Net change in unrealized appreciation on investments and options 9,152
---------
---------
Net gain on investments 65,005
---------
Net increase in net assets
resulting from operations $69,641
==========
See Notes to Financial Statements
RUPAY-BARRINGTON VALUE EQUITY FUND
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
August 14, 1998*
Six months ended to
June 30, 1999 December 31,
(Unaudited) 1998
------------------- --------------
OPERATIONS
Net investment income $4,636 $1,121
Net realized gain on investments 55,853 -
Net change in unrealized
appreciation of investments and 9,152 7,543
options
--------------- --------------
Net increase
in net assets resulting
from operations 69,641 8,664
DISTRIBUTION TO
SHAREHOLDERS FROM:
Net investment income (4,207) (1,049)
($.05 and $.03 per share)
CAPITAL SHARE TRANSACTIONS
Net increase in
net assets resulting
from capital share
transactions** 431,800 438,983
--------------- --------------
Net increase
in net assets 497,234 446,598
Net assets at
beginning of period 446,598 -
--------------- --------------
NET ASSETS at the end
of the period(Including undistributed $943,832 $446,598
=============== ==============
net investment income of $-, and $72,
respectively)
**A summary of capital share transactions follows:
Six months ended August 14, 1998*
June 30, 1999 to
(Unaudited) December 31, 1998
Shares Value Shares Value
------------------------------ -------------------------
Shares sold 44,617 $472,492 43,101 $437,935
Shares
reinvested
from distributions - - 103 1,048
Shares
redeemed (3,676) (40,692) - -
----------------------------- --------------------------
Net increase 40,941 $431,800 43,204 $438,983
============================== ========================
*Commencement of operations
See Notes to Financial Statements
RUPAY-BARRINGTON VALUE EQUITY FUND
Financial Highlights
For a Share Outstanding Throughout Each Period
- --------------------------------------------------------------------------------
Six months ended August 14, 1998* to
June 30, 1999 December 31,
(Unaudited) 1998
-----------------------------------
Per Share Operating
Performance
Net asset value,
beginning of period $10.34 $10.00
--------------- ---------------
Income from investment
operations-
Net investment income 0.06 0.03
Net realized and unrealized
gain on investments 0.87 0.34
--------------- ---------------
Total from investment
operations 0.93 0.37
--------------- ---------------
Less distributions-
Distributions from net
investment income (0.05) (0.03)
Total distributions (0.05) (0.03)
--------------- ---------------
Net asset value, end of period $11.22 $10.34
============== ===============
Total Return 9.00% 3.65%
=============== ===============
Ratios/Supplemental Data
Net assets, end of period (000's) $944 $447
Ratio to average net assets (A)
Expenses before reimbursement (B) 9.51% ** 13.76% **
Expenses-net (C) 1.84% ** 1.55% **
Net investment income 1.36% ** 1.61% **
Portfolio turnover rate 80.54% 0.00%
*Commencement of operations
**Annualized
(A) Management fee waivers and reimbursements reduced the expense ratios and
increased net investment income ratios by 7.67%** and 12.21%** for the
periods ended June 30, 1999 and December 31, 1998, respectively.
(B) Expense ratio after reimbursement has been increased to include additional
custodian fees for the periods ended June 30, 1999 and December 31, 1998
which were offset by custodian fee credits.
(C) Expense ratio-net reflects the effect of the custodian fee credits the
fund received.
See Notes to Financial Statements
Notes to the Financial Statements
June 30, 1999
(Unaudited)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES--The Rupay-Barrington Value Equity Fund
is a series of Rupay-Barrington Funds, Inc. (formerly Rupay-Barrington Total
Return Fund, Inc.)(the "Fund") is registered under The Investment Company Act of
1940, as a diversified open-end management company. The Fund commenced
operations on August 14, 1998.
The investment objective of the fund is to seek capital appreciation, current
income and preservation of capital by investing in a diversified portfolio of
equity securities and fixed income securities.
The following is a summary of significant accounting policies consistently
followed by the Fund. The policies are in conformity with generally accepted
accounting principles.
A. Security Valuation. Investments in securities listed or traded on a
nationally recognized securities exchange are valued at the last quoted
sales price on the date the valuations are made. Securities regularly
traded in the over-the-counter market are valued at the last quoted
sales price on the NASDAQ System. If no sales price is available for a
listed or NASDAQ security, or if the security is not listed on NASDAQ,
such security is valued at a price equal to the mean of the latest bid
and ask prices.
B. Federal Income Taxes. The Fund intends to comply with the requirements
of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its
shareholders. Therefore, no federal income tax provision is required.
C. Security Transactions. Security transactions are accounted for on the
trade date. The cost of securities sold is determined on a first-in,
first-out basis.
D. Distribution to Shareholders. Distributions from investment income and
realized gains, if any, are recorded on the ex-dividend date.
E. Other. Dividend income is recorded on the ex-dividend date. Interest
income is recorded on an accrual basis.
F. Accounting Estimates. In preparing financial statements in conformity
with generally accepted accounting principles, management makes
estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of the financial statements, as well as the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
<PAGE>
G. Covered Call Options. The Fund may write call options, but only on a
covered basis; that is, the Fund will own the underlying security. Options
written by the Fund normally will have expiration dates between three and
nine months from the date written. The exercise price of a call option may
be below, equal to, or above the current market value of the underlying
security at the time the option is written. When the Fund writes a covered
call option, an amount equal to the premium received by the Fund is
recorded as an asset and an equivalent liability. The amount of the
liability is subsequently "marked-to-market" to reflect the current market
value of the option written. The current market value of a written option
is the mean between the last bid and asked prices on that day. If a written
call option expires on the stipulated expiration date, or if the Fund
enters into a closing purchase transaction, the Fund realizes a gain (or a
loss if the closing purchase transaction exceeds the premium received when
the option was written) without regard to any unrealized gain or loss on
the underlying security, and the liability related to such option is
extinguished. If a written option is exercised, the Fund realizes a gain or
a loss from the sale of the underlying security and the proceeds of the
sale are increased by the premium originally received.
A call option gives the purchaser of such option the right to buy, and
the writer (the Fund) the obligation to sell, the underlying security
at the stated exercise price during the option period. The purchaser of
a call option has the right to acquire the security which is the
subject of the call option at any time during the option period. During
the option period, in return for the premium paid by the purchaser of
the option, the Fund has given up the opportunity for capital
appreciation above the exercise price should the market price of the
underlying security increase, but has retained the risk of loss should
the price of the underlying security decline. During the option period,
the Fund may be required at any time to deliver the underlying security
against payment of the exercise price. This obligation is terminated
upon the expiration of the option period or at such earlier time at
which the Fund effects a closing purchase transaction by purchasing (at
a price which may be higher than that received when the call option was
written) a call option identical to the one originally written.
NOTE 2-INVESTMENT MANAGEMENT AND DISTRIBUTION AGREEMENTS--The Fund has engaged
Rupay-Barrington Advisors, Inc. a wholly-owned subsidiary of Rupay-Barrington
Financial Group Inc., to manage its investments. The Fund pays its Advisors an
investment management fee for investment management and advisory services which
is computed at an annual rate of 0.80 of 1% of the Fund's daily net assets.
Rupay-Barrington Financial Group Inc. has agreed to reimburse the Fund for any
expenses, during the Fund's first five years of operations, which would cause
the Fund's ratio of operating expenses to exceed 1.95% of average net assets.
For the six months ended June 30, 1999, a reimbursement of $25,879 was made.
As provided in the Administrative Agreement, the Fund reimbursed Commonwealth
Shareholder Services, Inc. ("CSS"), its Administrative Agent, $7,438 for
providing shareholder services, recordkeeping, administrative services and
blue-sky filings. The Fund compensates CSS for blue-sky filings and certain
shareholder servicing on an hourly rate basis. For other administrative
services, CSS receives .20% of average daily net assets.
Fund Services, Inc. ("FSI") is the Fund's Transfer and Dividend Disbursing
Agent. FSI received $5,251 for its services for the six months ended June 30,
1999.
Certain officers and directors of the Fund are also officers and directors of
the investment advisor.
NOTE 3-INVESTMENTS\CUSTODY--For the six months ended June 30, 1999, the Fund
made purchases and sales of securities other than short-term notes aggregated
$581,792 and $325,905, respectively. The custodian has provided credits in the
amount of $274 against custodian and accounting charges based on credits on cash
balances.
NOTE 4-DISTRIBUTION PLAN--The Fund has adopted a Distribution Plan pursuant to
Rule 12b-1 under the Investment Company Act of 1940. Under the plan ,
Rupay-Barrington Securities Corp., a wholly-owned subsidiary of Rupay-Barrington
Financial Group Inc., was entitled to a fee at an annual rate of 0.35 of 1% of
the Fund's daily net assets. Rupay-Barrington Securities Corp. uses these fees
to pay its dealers whose clients hold portfolio shares and for other
distribution-related activities. No amounts were paid during the six months
ended June 30, 1999.
NOTE 5- OPEN COVERED CALL OPTIONS WRITTEN -Transactions in call options written
during the six months ended June 30, 1999 are summarized as follows:
Option Contracts
Number of Premiums
Contracts Received
Beginning of period 24 $ 4,535
Written 56 10,560
Closed 0 0
Exercised 0 0
Expired ____32 __6,106
-- -----
End of period 48 $ 8,989
----------- --------
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