THE BRAMWELL GROWTH FUND
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QUARTERLY REPORT - SEPTEMBER 1999
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745 Fifth Avenue
New York, New York 10151
DEAR FELLOW SHAREHOLDERS: (PHOTO)
INVESTMENT RESULTS - QUARTER ENDED SEPTEMBER 30, 1999
THE BRAMWELL GROWTH FUND celebrated its 5TH BIRTHDAY on August 1, 1999. For the
twelve months ended September 30, the Fund appreciated 26.6% to $24.88 net asset
value per share, compared to the 27.8% gain for the S&P 500 Stock Index. For
the quarter, the Fund declined (4.6)%, less than the decline of (6.2)% for the
S&P 500 Index and between the declines of (3.6)% and (5.2)% for the Lipper Mid-
Cap and Growth Funds Indices, respectively. The Fund's compound average annual
return as of September 30, for three years was 23.7% and for five years, 22.7%.
Since inception, August 1, 1994, through September 30, 1999, the cumulative
return was 184.5% resulting in a compound average annual rate of return since
inception of 22.4%. Investment results relative to the indices were as follows:
<TABLE>
<CAPTION>
COMPARATIVE INVESTMENT SEPT Q CALENDAR ONE THREE FIVE SINCE
RETURNS (9/30/99) 1999 YEAR-TO-DATE YEAR YEARS <F1> YEARS <F1> INCEPTION <F2>
---------------------------- ------- ------------- ------ --------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
THE BRAMWELL GROWTH FUND <F3> (4.6)% 3.2% 26.6% 23.7% 22.7% 22.4%
Lipper Mid-Cap Funds Index <F4> (3.6) 7.8 33.4 13.4 17.3 18.0
Lipper Growth Funds Index <F4> (5.2) 6.1 30.3 21.8 21.4 21.1
S&P 500 Stock Index <F5> (6.2) 5.4 27.8 25.1 25.0 24.5
<F1> Compound average annual return. <F2> Compound average annual return
since inception 8/1/94. <F3> Returns shown include the reinvestment of all
dividends and are net of expenses. The annual expense ratio is capped at
1.75% which for the years ending June 30, 1997, favorably affected
performance. Past performance is not predictive of future results.
Investment returns and principal value will fluctuate, so that shares, when
redeemed, may be worth more or less than their original cost. <F4> The
Lipper Mid-Cap Funds Index is comprised of the 30 largest funds which by
prospectus or portfolio practice, invest primarily in companies with market
capitalizations less than $5 billion at the time of purchase. The Lipper
Growth Funds Index is comprised of the 30 largest funds which by prospectus
or portfolio practice, normally invest in companies with long-term earnings
expected to grow significantly faster than the earnings of the stocks
represented in the major unmanaged stock indexes. Funds in the Lipper Mid-
Cap and Growth Funds Indices are equal weighted and returns include the
reinvestment of all dividends and are net of expenses. <F5> The S&P 500
Stock Index is an unmanaged index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is adjusted for
dividends, weighted towards stocks with large market capitalizations and
represents approximately two-thirds of the total market value of all
domestic common stocks.
</TABLE>
COMMENTARY
The equity markets declined in the September quarter in response to higher
interest rates, and valuations, such as price/earnings ratios, contracted. The
economy was strong, profits were better than expected, and inflation was
minimal. Technology and communications stocks did well and financial and
pharmaceutical manufacturing and distribution companies did poorly. Healthcare
stocks started to do better in late September as concerns about product
pipelines and political uncertainty decreased.
Individual stocks that contributed significant incremental value to the
portfolio in the quarter were: EMC, Tiffany, Lexmark, Intel, Nortel, Amgen, Dell
Computer, Home Depot, Cinar Films and General Electric. Stocks that reduced
returns but which we continue to like and still hold rather than trade around
quarterly oscillations include Walgreen, Kohl's, MCI WorldCom, CVS and Cardinal
Health.
OUTLOOK
Domestic economic growth should continue to be strong but slow somewhat as a
tight domestic labor supply slows the implementation of various expansion plans
and recent interest rate increases impact the housing market. We expect
inflation, however, to be largely restrained as technology continues to improve
productivity and facilitate workers working smarter and as technology is
increasingly substituted for labor. The core Consumer Price Index (CPI),
excluding a one-time jump in tobacco prices, rose only 0.2% in September and
1.6% year over year. We anticipate that interest rates will remain in a narrow
range with possibly one more rate increase by the Federal Reserve. Meanwhile,
economies around the world are recovering, leading potentially to synchronized
global growth.
As we approach the millenium, change is accelerating on many fronts. Just like a
century ago when innovation introduced entire new industries such as electricity
and automobiles, the late 1990s have seen the arrival of such transforming
technologies as the Internet and wireless telephony. New technologies and
competition are accelerating the pace of obsolescence and driving capital
investment and overall economic growth higher than the historical norm. After we
cross into Year 2000, we anticipate many deferred capital spending plans to be
implemented. Change creates investment opportunities.
We try to position the portfolio in front of secular change, e.g., the move to
outsourcing such as contract electronic manufacturing and the move to wireless
communications, by investing in leading companies in their respective markets.
We continue to seek out companies that use the Internet well both in generating
revenues and reducing costs, particularly as business-to-business electronic
commerce emerges. We also prefer companies with recurring revenue streams,
strong top-line growth and positioning for the long-term return on investment in
new products and services stemming from research and development. In terms of
valuation, we seek to invest in companies with favorable price/earnings ratios
to growth and the overall market.
The estimated 1999 and 2000 growth rates for our portfolio continue to
approximate 20%, about twice the estimated growth rate for the S&P 500, for
which we are paying about the same price/earnings multiple on estimated 2000
earnings. Stock prices move with earnings growth over time. Performance so far
this year has been restrained, however, by the downward adjustment in P/E ratios
to reflect higher interest rates. Assuming interest rates plateau going forward,
overall stock prices should move more in line with earnings growth.
We intend to take advantage of the recent downdraft in prices resulting from
higher interest rate fears to enhance our potential portfolio returns by
investing at more attractive prices and valuations in companies at the forefront
of innovation with much of their growth self-driven and independent of general
economic conditions.
FUND INVESTMENT
The minimum initial investment for a Regular account is $1,000 and for an IRA or
Gift to Minor account $500. Subsequent investment minimums are $100 for Regular
and IRA accounts and $50 for a Gift to Minor account. Equity markets are
inherently volatile, and investors are encouraged to invest over time to smooth
the effects of volatility. An Automatic Investment Plan, with initial and
subsequent investment minimums of $50 per month, is available upon request to
facilitate regular investment.
The Fund's net asset value is available each evening after 6:00 p.m. (EST) by
calling 1-800-BRAMCAP (1-800-272-6227). Please also call this number if you
need assistance or additional information. The daily net asset value may also be
attained from our Web site, WWW.BRAMWELL.COM. Our Nasdaq symbol is BRGRX.
Sincerely,
/s/Elizabeth R. Bramwell
Elizabeth R. Bramwell, CFA
President and Chief Investment Officer
October 20, 1999
The outlook and opinions expressed above represent the views of the investment
adviser as of October 20, 1999 and are subject to change as market and economic
events unfold.
THE BRAMWELL GROWTH FUND
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PORTFOLIO OF INVESTMENTS - SEPTEMBER 30, 1999 (UNAUDITED)
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SHARES VALUE
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COMMON STOCKS - 99.11%
APPAREL - 0.49%
Cutter & Buck, Inc.<F1> 75,000 $1,167,187
CHEMICALS - 1.58%
Minerals Technologies, Inc. 38,000 1,845,375
OM Group, Inc. 50,000 1,918,750
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3,764,125
COMMUNICATIONS - 11.63%
America Online, Inc.<F1> 6,000 624,000
Bell Atlantic Corporation 34,000 2,288,625
Cisco Systems, Inc.<F1> 47,000 3,222,437
Comcast Corporation, Class A 10,000 398,750
Cox Communications, Inc., Class A<F1> 15,000 626,250
EarthLink Network, Inc.<F1> 15,000 644,062
GTE Corporation 35,000 2,690,625
Lucent Technologies, Inc. 95,000 6,163,125
MCI WorldCom, Inc.<F1> 65,000 4,671,875
Nortel Networks Corporation 85,000 4,335,000
Young & Rubicam, Inc. 45,000 1,980,000
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27,644,749
ELECTRONICS - 7.16%
Applied Materials, Inc.<F1> 35,000 2,725,625
Flextronics International Ltd.<F1> 35,000 2,036,563
Intel Corporation 65,000 4,830,313
Jabil Circuit, Inc.<F1> 35,000 1,732,500
Solectron Corporation<F1> 28,500 2,046,656
Teradyne, Inc.<F1> 80,000 2,820,000
Texas Instruments, Inc. 10,000 822,500
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17,014,157
EMPLOYEE STAFFING - 2.44%
Keane, Inc.<F1> 50,000 1,140,625
Labor Ready, Inc.<F1> 105,000 1,056,562
On Assignment, Inc.<F1> 100,000 2,400,000
Robert Half International, Inc.<F1> 50,000 1,200,000
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5,797,187
ENERGY - 1.98%
Baker Hughes, Inc. 40,000 1,160,000
Diamond Offshore Drilling, Inc. 50,000 1,668,750
Nabors Industries, Inc.<F1> 20,000 500,000
Schlumberger Ltd. 22,000 1,370,875
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4,699,625
ENTERTAINMENT & LEISURE TIME - 4.12%
AT&T Corporation - Liberty Media
Group, Class A<F1> 30,000 1,113,750
CBS Corporation<F1> 40,000 1,850,000
Cinar Corporation, Class B<F1> 64,000 1,936,000
Fox Entertainment Group, Inc., Class A<F1> 65,000 1,373,125
Imax Corporation<F1> 70,000 1,400,000
Time Warner, Inc. 35,000 2,126,250
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9,799,125
FINANCIAL SERVICES - 7.64%
American International Group, Inc. 15,625 1,358,398
Charles Schwab Corporation (The) 70,000 2,358,125
Citigroup, Inc. 60,000 2,640,000
Firstar Corporation 105,000 2,690,625
H&R Block, Inc. 15,000 651,563
Shares Value
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FINANCIAL SERVICES - 7.64% (CONT'D.)
Jones Lang LaSalle, Inc.<F1> 45,600 $735,300
Mellon Bank Corporation 50,000 1,687,500
Merrill Lynch & Company, Inc. 10,000 671,875
Northern Trust Company 41,000 3,423,500
State Street Corporation 30,000 1,938,750
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18,155,636
HEALTHCARE: PRODUCTS - 6.22%
Amgen, Inc.<F1> 28,000 2,282,000
Bausch & Lomb, Inc. 15,000 989,062
Eli Lilly & Company 15,000 960,000
Focal, Inc.<F1> 25,000 125,000
Genentech, Inc.<F1> 5,000 731,563
Johnson & Johnson 15,000 1,378,125
Medtronic, Inc. 54,000 1,917,000
Merck & Company, Inc. 20,000 1,296,250
Pfizer, Inc. 90,000 3,234,375
Sepracor, Inc.<F1> 25,000 1,887,500
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14,800,875
HEALTHCARE: SERVICES - 1.96%
Cardinal Health, Inc. 85,500 4,659,750
HOME & OFFICE FURNITURE - 0.41%
Leggett & Platt, Inc. 50,000 984,375
HOUSEHOLD & PERSONAL CARE PRODUCTS - 1.13%
Colgate-Palmolive Company 50,000 2,287,500
Estee Lauder Companies (The), Class A 10,000 390,625
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2,678,125
INDUSTRIAL PRODUCTS - 6.15%
Emerson Electric Company 30,800 1,946,175
General Electric Company 60,000 7,113,750
Illinois Tool Works, Inc. 35,000 2,609,688
Molex Inc., Class A 91,385 2,958,589
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14,628,202
INFORMATION PROCESSING:
OFFICE EQUIPMENT - 13.87%
Dell Computer Corporation<F1> 90,000 3,763,125
EMC Corporation<F1> 155,000 11,072,812
International Business
Machines Corporation 76,000 9,224,500
Lexmark International Group, Inc.<F1> 75,000 6,037,500
Pitney Bowes, Inc. 30,000 1,828,125
Xerox Corporation 25,000 1,048,437
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32,974,499
INFORMATION PROCESSING:
SERVICES - 8.74%
Automatic Data Processing, Inc. 125,000 5,578,125
Computer Sciences Corporation<F1> 150,058 10,550,953
DST Systems, Inc.<F1> 46,500 2,644,688
Paychex, Inc. 58,500 1,996,313
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20,770,079
INFORMATION PROCESSING:
SOFTWARE - 2.62%
Legato Systems, Inc.<F1> 10,000 435,937
Microsoft Corporation<F1> 64,000 5,796,000
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6,231,937
THE BRAMWELL GROWTH FUND
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PORTFOLIO OF INVESTMENTS - SEPTEMBER 30, 1999 (UNAUDITED) (CONTINUED)
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SHARES VALUE
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METALS - 0.78%
Alcoa, Inc. 30,000 $1,861,875
RETAILING - 19.17%
CVS Corporation 83,000 3,387,438
Costco Wholesale Corporation<F1> 24,000 1,728,000
Dayton Hudson Corporation 35,000 2,102,188
Home Depot, Inc. (The) 111,000 7,617,375
Kohl's Corporation<F1> 93,000 6,149,625
Lowe's Companies, Inc. 60,000 2,925,000
Office Depot, Inc.<F1> 118,500 1,207,219
Tandy Corporation 30,000 1,550,625
Tiffany & Company 105,600 6,329,400
Wal-Mart Stores, Inc. 110,000 5,231,875
Walgreen Company 290,000 7,358,750
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45,587,495
TRANSPORTATION - 1.02%
Kansas City Southern Industries, Inc. 52,000 2,414,750
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TOTAL COMMON STOCKS
(Cost $138,089,215) 235,633,753
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PRINCIPAL
AMOUNT VALUE
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VARIABLE RATE
DEMAND NOTES - 0.57%
Firstar Corporation $1,353,000 $1,353,000
TOTAL VARIABLE RATE DEMAND NOTES
(Cost $1,353,000) 1,353,000
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TOTAL INVESTMENTS - 99.68%
(Cost $139,442,215) 236,986,753
OTHER ASSETS LESS LIABILITIES - 0.32% 759,486
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NET ASSETS - 100.00%
(9,555,896 shares outstanding) $237,746,239
============
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE $24.88
======
<F1> Non-income producing security
THE BRAMWELL GROWTH FUND
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QUARTERLY REPORT - SEPTEMBER 30, 1999
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TOP TEN INDUSTRY SECTORS
SEPTEMBER 30, 1999
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Information Processing 25.2%
Retailing 19.2
Communications 11.6
Financial Services 7.6
Healthcare 8.2
Electronics 7.2
Industrial Products 6.2
Entertainment & Leisure Time 4.1
Employee Staffing 2.4
Energy 2.0
TOP TEN EQUITY HOLDINGS
SEPTEMBER 30, 1999
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EMC 4.7%
Computer Sciences 4.4
IBM 3.9
Home Depot 3.2
Walgreen 3.1
General Electric 3.0
Tiffany 2.7
Lucent 2.6
Kohl's 2.6
Lexmark 2.5
THE BRAMWELL GROWTH FUND
745 Fifth Avenue
New York, New York 10151
1-800-BRAMCAP
(1-800-272-6227)
www.bramwell.com
BOARD OF DIRECTORS
-------------------
ELIZABETH R. BRAMWELL, CFA
President, Chief Investment
and Financial Officer
The Bramwell Funds, Inc.
J. SINCLAIR ARMSTRONG
Director, Secretary and Treasurer
The Reed Foundation, Inc.
Retired Executive VP
US Trust Co. of New York
Former Chairman
Securities & Exchange Commission
ISABEL H. BENHAM
Trustee Emeritus and former President, Board of Trustees
John W. Barriger III National Railroad Library
GEORGE F. KEANE
Chairman
Trigen Energy Corp.
President Emeritus
The Common Fund, Inc.
JAMES C. SARGENT
Counsel
Opton, Handler, Gottlieb, Feiler & Katz
Former Commissioner
Securities & Exchange Commission
MARTHA R. SEGER, PH.D.
Chairman
Martha Seger & Associates
Former Governor
Federal Reserve Board
OFFICERS
---------
ELIZABETH R. BRAMWELL, CFA
President, Chief Investment and Financial Officer
MARY F. MCCOLLUM
Secretary and Treasurer
MARGARET A. BANCROFT
Assistant Secretary
INVESTMENT ADVISER
Bramwell Capital Management, Inc.
ADMINISTRATOR
Sunstone Financial Group, Inc.
COUNSEL
Dechert Price & Rhoads
INDEPENDENT CERTIFIED
PUBLIC ACCOUNTANTS
PricewaterhouseCoopers LLP
CUSTODIAN
Firstar Bank Milwaukee
TRANSFER AGENT
AND DIVIDEND DISBURSING AGENT
Firstar Mutual Fund Services, LLC
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This financial statement is submitted for the general information of the
shareholders of The Bramwell Growth Fund. It is not authorized for distribution
to prospective investors unless preceded or accompanied by an effective
prospectus.
BR-412-1099
