- --------------------------------------------------------------------------------
SEMI-ANNUAL REPORT
DECEMBER 31, 1998
<PHOTO>
THE BRAMWELL GROWTH FUND
- --------------------------
ELIZABETH R. BRAMWELL, CFA
President and Chief Investment Officer
THE BRAMWELL FUNDS, INC.
1-800-BRAMCAP
(1-800-272-6227)
WWW.BRAMWELL.COM
THE BRAMWELL GROWTH FUND
- --------------------------------------------------------------------------------
SEMI-ANNUAL REPORT - DECEMBER 1998
- --------------------------------------------------------------------------------
745 Fifth Avenue
New York, New York 10151
DEAR FELLOW SHAREHOLDERS:
INVESTMENT RESULTS - QUARTER ENDED DECEMBER 31, 1998
THE BRAMWELL GROWTH FUND appreciated 34.5% for the 1998 calendar year,
surpassing the 28.6% gain for the S&P 500 Stock Index as well as the 13.9% and
25.7% gains for the Lipper Mid-Cap and Growth Funds Indices, respectively. The
Fund ended December at $24.12 net asset value per share after payment of a
$1.2523 per share dividend on December 7, 1998. For the quarter, the Fund
returned 22.7% exceeding the S&P 500 Index gain of 21.3%. The Fund's three-year
compound average annual return as of December 31, was 26.6%, and since
inception, August 1, 1994, through December 31, 1998, the Fund's cumulative
return was 175.8% resulting in a compound average annual rate of return since
inception of 25.8%. Investment results compared to those of other indices were
as follows:
- --------------------------------------------------------------------------------
COMPARATIVE INVESTMENT DECEMBER Q ONE THREE SINCE
RETURNS (12/31/98) 1998 YEAR YEARS<F1> INCEPTION<F2>
- --------------------------------------------------------------------------------
THE BRAMWELL GROWTH FUND 22.7% 34.5% 26.6% 25.8%
Lipper Mid-Cap Funds Index<F3> 23.7 13.9 15.9 19.3
Lipper Growth Funds Index<F3> 22.8 25.7 23.7 23.4
S&P 500 Stock Index<F4> 21.3 28.6 28.2 27.7
<TABLE>
<CAPTION>
8/1/94 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
- ------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
THE BRAMWELL GROWTH FUND $10,000 $10,259 $13,599 $15,342 $20,507 $27,581
S&P 500 Stock Index $10,000 $10,154 $13,969 $17,177 $22,908 $29,454
Lipper Growth Funds Index $10,000 $10,087 $13,381 $15,727 $20,136 $25,309
Lipper Mid-Cap Funds Index $10,000 $10,533 $14,018 $16,303 $19,150 $21,816
</TABLE>
This chart assumes an initial investment of $10,000 made on 8/1/94 (inception).
Returns shown for The Bramwell Growth Fund include the reinvestment of all
dividends and are net of expenses. The annual expense ratio is capped at 1.75%
which for the years ended June 30, 1997 favorably affected performance. Past
performance is not predictive of future performance. Investment returns and
principal value will fluctuate, so that shares, when redeemed, may be worth more
or less than the original cost.
<F1> Compound average annual return. <F2> Compound average annual return since
inception 8/1/94. <F3> 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. <F4> 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.
COMMENTARY
Equity markets rose sharply and broadly in the December quarter in response to
lower interest rates, stabilization of the global financial markets, minimal
inflation and strong consumer confidence. Price/earnings ratios expanded.
Especially strong sectors were technology, communications, retailing and
financial services. Oil service stocks continued to decline in an environment
of declining oil prices and reduced capital spending plans. Individual stocks
that contributed significant value to the portfolio were Home Depot, EMC,
Lucent, Walgreen, Kohl's, IBM, Amazon.com, Charles Schwab, Computer Sciences and
Wal-Mart.
OUTLOOK
We anticipate economic growth to slow to 1-2% early in 1999 as the result of
economic weakness in Asia and emerging markets worldwide and that lower interest
rates and improved capital availability are likely to lead to synchronized
global growth in the second half and on into 2000. Inflation should be minimal,
given lower oil and other commodity prices, cheaper imports and technology-
driven productivity gains. The housing market should continue to be strong and
mortgages refinanced at lower interest rates will continue to release funds for
spending for consumer durables and other goods and services. Employment levels
continue to expand and consumer confidence is high. The new euro currency was
launched smoothly and can lead to new investment opportunities as well as more
efficient markets.
Our portfolio focus continues to be on companies that generate strong revenue
growth despite overall macroeconomic conditions. Companies that deliver
superior growth are likely to be given above-average and even expanding
price/earnings multiples. New products, which provide pricing flexibility as
well as create their own markets, should be valued highly in a sluggish global
economic environment. The explosive growth of the Internet and electronic
commerce and technology upgrades for the Year 2000 are driving change and
creating opportunities. New pharmaceutical products are coming to market at an
accelerated pace as biotechnology comes of age and document transmission is
moving from a copy-and-distribute to distribute-and-print paradigm. Themes that
we continue to like are outsourcing, communications, home-related products and
effective use of the Internet and technology in general.
The estimated 1999 growth rate for the portfolio continues to approximate 20%,
some 4-5 times that projected for the S&P 500 Index, for which we are paying
about the same price/earnings multiple of approximately 25 times. Over time,
stock prices move with earnings growth, and in an environment of low inflation
and flat to declining interest rates, price/earnings ratios may expand as well,
especially for companies selling at discounts to the overall market, thereby
increasing investment returns.
The decline in interest rates has made cash and other fixed income instruments
less attractive investment alternatives to equities. With yields of less than
5% on U.S. Treasury 3-month bills through 10-year notes, even 10% consistent
annual earnings growth is comparatively more attractive assuming that
price/earnings ratios at least hold even in an environment of flat to lower
interest rates. The 20% long-term capital gains tax rate also favors equity
investment. Market dips provide opportunities to establish or add to existing
investment positions at more attractive prices thereby bolstering long-term
investment returns.
FUND INVESTMENT
The minimum initial investment for a Regular account is $1,000 and for an IRA or
Gift to Minors 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. Also, please visit our Web site at
www.bramwell.com.
Sincerely,
/s/Elizabeth R. Bramwell
Elizabeth R. Bramwell, CFA
President and Chief
Investment Officer
January 22, 1999
The outlook and opinions expressed above represent the views of the investment
adviser as of January 22, 1999 and are subject to change as market and economic
events unfold.
TOP TEN INDUSTRY SECTORS
DECEMBER 31, 1998
------------------------------------------------------------
Information Processing 21.4% Employee Staffing 5.5%
Retailing 17.2 Industrial Products 5.2
Healthcare 10.8 Home & Office Furniture 3.3
Communications 9.9 Insurance 2.8
Financial Services 9.7 Electronics 1.9
TOP TEN EQUITY HOLDINGS
DECEMBER 31, 1998
------------------------------------------------------------
Computer Sciences 3.9% Robert Half 2.6%
Walgreen 3.4 IBM 2.6
Dell Computer 2.9 Cardinal Health 2.6
EMC 2.9 Pfizer 2.4
Home Depot 2.7 Lucent Technologies 2.4
THE BRAMWELL GROWTH FUND
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PORTFOLIO OF INVESTMENTS - DECEMBER 31, 1998 (UNAUDITED)
- --------------------------------------------------------------------------------
SHARES VALUE
------- ------
COMMON STOCKS - 97.34%
APPAREL - 0.75%
Cutter & Buck, Inc.<F1> 50,000 $ 1,862,500
AUTOMOTIVE & HEAVY
EQUIPMENT - 0.87%
Hayes Lemmerz International, Inc.<F1> 33,200 1,002,225
Lear Corporation<F1> 30,000 1,155,000
------------
2,157,225
CHEMICALS - 1.36%
Minerals Technologies, Inc. 38,000 1,555,625
OM Group, Inc. 50,000 1,825,000
------------
3,380,625
COMMUNICATIONS - 9.93%
Bell Atlantic Corporation 55,000 3,124,687
BellSouth Corporation 53,000 2,643,375
Cisco Systems, Inc.<F1> 21,000 1,949,062
EarthLink Network, Inc.<F1> 10,000 570,000
Lucent Technologies, Inc. 54,000 5,940,000
MCI WorldCom, Inc.<F1> 50,000 3,587,500
Northern Telecom Ltd. 45,000 2,255,625
Teleglobe, Inc. 38,000 1,368,000
U.S. West, Inc. 50,000 3,231,250
------------
24,669,499
ELECTRONICS - 1.86%
Flextronics International Ltd.<F1> 10,000 856,250
Intel Corporation 20,000 2,371,250
Solectron Corporation<F1> 15,000 1,394,063
------------
4,621,563
EMPLOYEE STAFFING - 5.49%
Interim Services, Inc.<F1> 100,000 2,337,500
Labor Ready, Inc.<F1> 70,000 1,378,125
On Assignment, Inc.<F1> 100,000 3,450,000
Robert Half International, Inc.<F1> 145,000 6,479,688
------------
13,645,313
ENERGY - 1.39%
Diamond Offshore Drilling, Inc. 40,000 947,500
Schlumberger Ltd. 54,300 2,504,588
------------
3,452,088
ENTERTAINMENT &
LEISURE TIME - 1.25%
Cinar Films, Inc., Class B<F1> 60,000 1,522,500
Imax Corporation<F1> 50,000 1,581,250
------------
3,103,750
SHARES VALUE
------- ------
FINANCIAL SERVICES - 9.73%
Charles Schwab Corporation (The) 52,500 $ 2,949,843
Federated Investors, Inc.<F1> 50,000 906,250
Firstar Corporation 35,000 3,263,750
LaSalle Partners, Inc.<F1> 25,600 753,600
Mellon Bank Corporation 20,000 1,375,000
North Fork Bancorporation, Inc. 50,000 1,196,875
Northern Trust Company 41,000 3,579,813
State Street Corporation 35,000 2,434,688
TCF Financial Corporation 60,000 1,451,250
Washington Mutual, Inc. 115,000 4,391,563
Zions Bancorporation 30,000 1,871,250
------------
24,173,882
FOOD & BEVERAGE - 1.80%
Bestfoods 55,000 2,928,750
Hershey Foods Corporation 25,000 1,554,687
------------
4,483,437
HEALTHCARE: PRODUCTS - 7.11%
BioChem Pharmaceuticals, Inc. - ADR<F1> 15,000 429,375
Closure Medical Corporation<F1> 10,000 298,125
Elan Corporation, PLC<F1> 20,000 1,391,250
Eli Lilly & Company 27,000 2,399,625
Focal, Inc.<F1> 25,000 240,625
Johnson & Johnson 15,000 1,258,125
Medtronic, Inc. 37,000 2,747,250
Merck & Company, Inc. 13,000 1,919,938
Pfizer, Inc. 48,000 6,021,000
Sepracor, Inc.<F1> 11,000 963,188
------------
17,668,501
HEALTHCARE: SERVICES - 3.73%
Cardinal Health, Inc. 84,500 6,411,437
PAREXEL International Corporation<F1> 40,000 1,000,000
Quintiles Transnational Corporation<F1> 35,000 1,868,125
------------
9,279,562
HOME & OFFICE FURNITURE - 3.28%
Ethan Allen Interiors, Inc. 30,000 1,230,000
Furniture Brands International, Inc.<F1> 50,000 1,362,500
Herman Miller, Inc. 50,000 1,343,750
HON Industries, Inc. 40,000 957,500
Knoll, Inc.<F1> 35,200 1,042,800
Leggett & Platt, Inc. 100,000 2,200,000
------------
8,136,550
THE BRAMWELL GROWTH FUND
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS - DECEMBER 31, 1998 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
SHARES VALUE
------- ------
HOUSEHOLD & PERSONAL CARE
PRODUCTS - 1.12%
Colgate-Palmolive Company 30,000 $ 2,786,250
INDUSTRIAL PRODUCTS - 5.17%
Emerson Electric Company 40,800 2,552,550
General Electric Company 40,000 4,082,500
Illinois Tool Works, Inc. 65,000 4,103,125
Molex Inc., Class A 66,385 2,116,022
------------
12,854,197
INFORMATION PROCESSING:
OFFICE EQUIPMENT - 10.69%
Dell Computer Corporation<F1> 100,000 7,318,750
EMC Corporation<F1> 85,000 7,225,000
International Business
Machines Corporation 35,000 6,466,250
Lexmark International Group, Inc.<F1> 20,000 2,010,000
Xerox Corporation 30,000 3,540,000
------------
26,560,000
INFORMATION PROCESSING:
SERVICES - 9.08%
Automatic Data Processing, Inc. 58,500 4,690,969
Computer Sciences Corporation<F1> 150,058 9,669,362
DST Systems, Inc.<F1> 65,000 3,709,062
Paychex, Inc. 20,000 1,028,750
Sterling Commerce, Inc.<F1> 77,000 3,465,000
------------
22,563,143
INFORMATION PROCESSING:
SOFTWARE - 1.62%
Microsoft Corporation<F1> 29,000 4,021,938
INSURANCE - 2.82%
Allstate Corporation 70,000 2,703,750
American International Group, Inc. 20,500 1,980,812
Chubb Corporation (The) 25,000 1,621,875
Horace Mann Educators Corporation 25,000 712,500
------------
7,018,937
RETAILING - 17.20%
Amazon.com, Inc.<F1> 4,500 1,445,625
CVS Corporation 60,000 3,300,000
Dayton Hudson Corporation 35,000 1,898,750
SHARES VALUE
------- ------
RETAILING (CONT'D.) - 17.20%
Home Depot, Inc. (The) 111,000 $ 6,791,812
Kohl's Corporation<F1> 93,000 5,713,687
Lowe's Companies, Inc. 75,000 3,839,062
Office Depot, Inc.<F1> 75,000 2,770,313
Sak's, Inc.<F1> 40,000 1,262,500
Tiffany & Company 52,800 2,739,000
Wal-Mart Stores, Inc. 55,000 4,479,063
Walgreen Company 145,000 8,491,563
------------
42,731,375
TRANSPORTATION - 1.09%
Kansas City Southern Industries, Inc. 55,000 2,705,312
------------
TOTAL COMMON STOCKS
(Cost $141,344,221) 241,875,647
------------
PRINCIPAL
AMOUNT
-----------
VARIABLE RATE
DEMAND NOTES - 3.22%
Firstar Corporation $ 3,394,000 3,394,000
General Mills, Inc. 2,017,000 2,017,000
Pitney Bowes Credit Corporation 609,000 609,000
Sara Lee Corporation 1,976,000 1,976,000
------------
TOTAL VARIABLE RATE DEMAND NOTES
(Cost $7,996,000) 7,996,000
------------
TOTAL INVESTMENTS - 100.56%
(Cost $149,340,221) 249,871,647
LIABILITIES LESS
CASH AND OTHER ASSETS - (0.56)% (1,388,009)
------------
NET ASSETS - 100.00%
(10,300,622 shares outstanding) $248,483,638
============
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE $24.12
======
<F1>Non-income producing security
See notes to financial statements.
THE BRAMWELL GROWTH FUND
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
December 31, 1998 (Unaudited)
ASSETS:
Investments, at value (cost $149,340,221) $249,871,647
Receivable for securities sold 210,505
Dividends and interest receivable 177,459
Organizational costs, net of accumulated
amortization 19,457
Prepaids and other assets 55,031
------------
Total Assets 250,334,099
------------
LIABILITIES:
Payable for securities purchased 1,436,057
Accrued investment advisory fees 198,263
Accrued expenses 166,575
Accrued distribution fees 49,566
------------
Total Liabilities 1,850,461
------------
NET ASSETS $248,483,638
============
NET ASSETS CONSIST OF:
Capital stock $147,066,272
Undistributed net realized gain on investments 885,940
Net unrealized appreciation on investments 100,531,426
------------
NET ASSETS $248,483,638
============
CAPITAL STOCK, $.0001 par value
Authorized 200,000,000
Issued and outstanding 10,300,622
NET ASSET VALUE, REDEMPTION PRICE
AND OFFERING PRICE PER SHARE $24.12
======
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
For the Six Months Ended December 31, 1998 (Unaudited)
INVESTMENT INCOME:
Dividends $ 673,224
Interest 344,599
------------
Total Investment Income 1,017,823
------------
EXPENSES:
Investment advisory fees 1,051,430
Distribution fees 262,858
Shareholder servicing fees 112,484
Fund administration and accounting fees 109,284
Reports to shareholders 37,183
Custody fees 29,799
Professional fees 28,209
Amortization of organizational costs 21,016
Federal and state registration fees 20,293
Directors' fees 13,570
Other 15,874
------------
Net Expenses 1,702,000
------------
NET INVESTMENT LOSS (684,177)
------------
REALIZED AND UNREALIZED GAINS:
Net realized gain on investments 4,265,613
Change in net unrealized appreciation
on investments 19,920,378
------------
Net Gain on Investments 24,185,991
------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $23,501,814
============
See notes to financial statements.
THE BRAMWELL GROWTH FUND
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the
Six Months
Ended Year
Dec. 31, 1998 Ended
(Unaudited) June 30, 1998
------------ ------------
OPERATIONS:
Net investment loss $ (684,177) $(1,194,521)
Net realized gain on
investments 4,265,613 13,427,206
Change in net unrealized
appreciation on
investments 19,920,378 40,370,192
------------ ------------
Net increase in net assets
resulting from
operations 23,501,814 52,602,877
------------ ------------
CAPITAL SHARE
TRANSACTIONS 31,208,904 36,040,184
------------ ------------
DIVIDENDS PAID FROM:
Net realized gains (12,148,722) (8,645,470)
------------ ------------
TOTAL INCREASE
IN NET ASSETS 42,561,996 79,997,591
NET ASSETS:
Beginning of period 205,921,642 125,924,051
------------ ------------
END OF PERIOD $248,483,638 $205,921,642
============ ============
See notes to financial statements.
THE BRAMWELL GROWTH FUND
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the
Six Months For the Period
Ended Year Year Year August 1, 1994<F1>
Dec. 31, 1998 Ended Ended Ended to
Selected Per-Share Data<F2> (Unaudited) June 30, 1998 June 30, 1997 June 30, 1996 June 30, 1995
- ---------------------------- ------------ ------------ ------------ ------------ ------------
<C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $23.05 $17.53 $14.60 $12.30 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.07) (0.13) (0.15) (0.08) -<F3>
Net realized and unrealized gains
on securities 2.39 6.82 3.35 2.42 2.31
------- ------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS 2.32 6.69 3.20 2.34 2.31
LESS DISTRIBUTIONS:
Distributions from capital gains (1.25) (1.17) (0.27) (0.04) (0.01)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $24.12 $23.05 $17.53 $14.60 $12.30
====== ====== ====== ====== ======
TOTAL RETURN 10.5% 39.5% 22.2% 19.0% 23.1%<F4>
SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period $248,483,638 $205,921,642 $125,924,051 $141,454,916 $62,241,343
Ratio of expenses to average net assets<F5> 1.62% 1.66% 1.75% 1.75% 1.75%<F6>
Ratio of net investment loss to average
net assets<F5> (0.65)% (0.75)% (0.85)% (0.66)% (0.11)%<F6>
Portfolio turnover rate 15% 49% 82% 118% 80%<F4>
</TABLE>
<F1> Commencement of operations
<F2> Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
<F3> Less than $(0.01)
<F4> Not annualized
<F5> Net of reimbursements and waivers. Absent reimbursements and waivers of
expenses by adviser, except for the six months ended December 31, 1998 and
the year ended June 30, 1998 where there were no reimbursements or waivers,
the ratios of expenses and net investment loss to average net assets for
the years ended June 30, 1997 and 1996 and the period August 1, 1994 to
June 30, 1995, would have been 1.77% and (0.87)%; 1.79% and (0.70)%; and
2.68% and (1.04)%, respectively.
<F6> Annualized
See notes to financial statements.
THE BRAMWELL GROWTH FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
December 31, 1998
1. ORGANIZATION
The Bramwell Funds, Inc. (the "Company") was incorporated on June 3, 1994 and is
registered as an open-end, management investment company organized as a series
fund under the Investment Company Act of 1940 (the "1940 Act"). The Bramwell
Growth Fund (the "Fund"), which commenced operations on August 1, 1994, is a
separate diversified portfolio of the Company. Bramwell Capital Management,
Inc. ("BramCap") is the Fund's investment adviser.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles
("GAAP"). The presentation of financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements and
the reported amount of revenue and expenses during the reporting period. Actual
results could differ from those estimates and assumptions.
a) Investment Valuation - A security listed or traded on a recognized stock
exchange or quoted on Nasdaq is valued at its last sale price prior to the time
when assets are valued. If no sale is reported on the valuation date, the most
current bid price will be used. All other securities for which over-the-counter
market quotations are readily available are valued at the most current bid
price. Debt securities which will mature in more than 60 days are valued at
prices furnished by a pricing service approved by the Board of Directors.
Whenever a furnished price is significantly different from the previous day's
furnished price, BramCap will review to determine that the price is appropriate.
Securities which will mature in 60 days or less are valued at amortized cost,
which approximates market value. Variable rate demand notes are valued at cost
which approximates market value. These notes are unsecured and could present
credit risk to the extent the issuer defaults on its payment obligation. The
creditworthiness of the issuer is monitored and these notes have been determined
to present minimal credit risk by BramCap. Any securities for which market
quotations are not readily available are valued at their fair value as
determined in good faith by the Board of Directors.
b) Federal Income Taxes - The Company's policy is to comply with the
requirements of the Internal Revenue Code that are applicable to regulated
investment companies and to distribute all its taxable income to its
shareholders. Therefore, no federal income tax provision is required.
c) Distributions to Shareholders - Dividends from net investment income are
declared and paid annually in December. Distributions of net realized capital
gains, if any, will be declared at least annually. Distributions to
shareholders are recorded on the ex-dividend date. The Fund may periodically
make reclassifications among certain of its capital accounts as a result of the
timing and characterization of certain income and capital gains distributions
determined annually in accordance with federal tax regulations, which may differ
from generally accepted accounting principles.
d) Organizational Costs - The costs incurred in connection with the
organization, initial registration and public offering of shares of the Fund
aggregated $153,472. These costs are being amortized over the period of
benefit, reflecting anticipated future asset levels of the Fund, but not to
exceed 60 months from the Fund's commencement of operations.
e) Other - Investment transactions are accounted for on the trade date. The
Fund determines the gain or loss realized from the investment transactions by
comparing the cost of the security lot sold with the net sale proceeds.
Dividend income is recognized on the ex-dividend date and interest income is
recognized on an accrual basis.
THE BRAMWELL GROWTH FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
3. CAPITAL SHARE TRANSACTIONS
Transactions in shares of the Fund for the six months ended December 31, 1998
and the year ended June 30, 1998, were as follows:
December 31, 1998
------------------
Shares Dollars
------------ ------------
Shares sold 3,609,649 $80,456,324
Dividends reinvested 501,650 11,307,190
Shares redeemed (2,744,549) (60,554,610)
------------ ------------
1,366,750 $31,208,904
============ ============
June 30, 1998
------------------
Shares Dollars
------------ ------------
Shares sold 3,045,628 $62,380,166
Dividends reinvested 422,349 8,180,907
Shares redeemed (1,719,248) (34,520,889)
------------ ------------
1,748,729 $36,040,184
============ ============
4. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of securities, excluding short-term
investments for the Fund, for the six months ended December 31, 1998 were
$54,440,649 and $29,141,292, respectively. There were no purchases or sales of
long-term U.S. government securities. At December 31, 1998, based on aggregate
cost for federal income tax purposes of $149,341,520, gross unrealized
appreciation and depreciation of investments were as follows:
Appreciation $103,848,251
Depreciation (3,318,124)
------------
Net appreciation on investments $100,530,127
============
5. INVESTMENT ADVISORY AGREEMENT
The Fund has an agreement with BramCap, with whom certain officers and a
director of the Fund are affiliated, to furnish investment advisory services to
the Fund. Under the terms of this agreement, the Fund will pay BramCap a monthly
fee at the annual rate of 1.00% on average daily net assets. The Fund's
investment adviser has voluntarily agreed to limit the total expenses of the
Fund (excluding interest, taxes, brokerage and extraordinary expenses) to an
annual rate of 1.75% of the Fund's average net assets until June 30, 1999.
After such date, the expense limitation may be terminated or revised at any
time. The expense ratio for the fiscal year ended June 30, 1998, was 1.66% and
for the six months ended December 31, 1998, was 1.62% annualized.
6. DISTRIBUTION PLAN
The Fund has adopted a Service and Distribution Plan (the "Plan") pursuant to
Rule 12b-1 under the 1940 Act. The Plan authorizes payments by the Fund in
connection with the distribution of its shares at an annual rate, as determined
from time to time by the Board of Directors, of up to 0.25% of the Fund's
average daily net assets.
THE BRAMWELL GROWTH FUND
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745 Fifth Avenue
New York, New York 10151
1-800-BRAMCAP (1-800-272-6227)
www.bramwell.com
BOARD OF DIRECTORS
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ELIZABETH R. BRAMWELL, CFA
President, Chief Investment
and Financial Officer
The Bramwell Funds, Inc.
J. SINCLAIR ARMSTRONG
Director, Secretary & Treasurer
The Reed Foundation, Inc.
Retired Partner
Whitman, Breed, Abbott & Morgan
Former Commissioner & Chairman
Securities & Exchange Commission
ISABEL H. BENHAM
Trustee Emeritus and former President, Board of Trustees
John W. Barringer 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
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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 AND DIVIDEND DISBURSING AGENT
Firstar Mutual Fund Services, LLC
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 accom panied by an effective
prospectus.
BR-408-0199
