- ------------------------------------------------------------------
ANCHOR
RESOURCE
AND
COMMODITY
TRUST
ANNUAL REPORT
DECEMBER 31, 1996
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1996
Assets:
Investments at quoted market value (cost $9,695,666;
see Schedule of Investments, Notes 1, 2, & 5)....... $11,196,383
Cash ................................................ 368,353
Dividends and interest receivable.................... 22,756
Other assets......................................... 3,769
-----------
Total assets..................................... 11,591,261
-----------
Liabilities:
Accrued expenses and other liabilities (Note 3 )..... 19,326
-----------
Total liabilities................................ 19,326
-----------
Net Assets:
Capital stock (unlimited shares authorized at $1.00 par
value,amount paid in on 1,106,994 shares outstanding)
(Note 1)............................................. 10,353,183
Accumulated undistributed net investment income...... 62,153
Accumulated realized loss from security transactions,net (344,118)
Net unrealized appreciation in value of investments
(Note 2)............................................. 1,500,717
-----------
Net assets (equivalent to $10.45 per share, based
on 1,106,994 capital shares outstanding)........... $11,571,935
===========
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
STATEMENT OF OPERATIONS
DECEMBER 31, 1996
Income:
Dividends........................................... $ 93,690
Interest............................................ 72,141
-----------
Total income..................................... 165,831
-----------
Expenses:
Management fees, net (Note 3)....................... 63,710
Audit and accounting fees........................... 9,000
Legal fees.......................................... 8,000
Pricing and bookkeeping fees (Note 4)............... 6,000
Trustees' fees and expenses......................... 1,000
Transfer fees (Note 4).............................. 1,000
Custodian fees...................................... 1,000
Other expenses...................................... 3,764
-----------
Total expenses................................... 93,474
-----------
Net investment income................................ 72,357
-----------
Realized and unrealized gain (loss) on investments:
Realized loss on investments-net................... (110,599)
Increase in net unrealized appreciation in investments 1,116,114
-----------
Net gain on investments.......................... 1,005,515
===========
Net increase in net assets resulting from operations. $1,077,872
===========
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended Year Ended
December 31, December 31,
1996 1995
----------------------------
From operations:
Net investment income................... $ 72,357 $ 135,138
Realized gain (loss) on investments, net (110,599) 60,536
Increase in net unrealized
appreciation in investments............ 1,116,114 384,602
----------- ------------
Net increase in net assets resulting
from operations..................... 1,077,872 580,276
------------ -----------
Distributions to shareholders:
From net investment income ($0.58 per
share in 1995) .......................... -- (429,688)
From net realized gain on investments.. -- --
------------ -----------
Total distributions to shareholders.. -- (429,688)
------------ -----------
From capital share transactions:
Number of Shares
1996 1995
--------- ---------
Proceeds from sale of
shares.............. 391,909 729,330 3,853,096 6,639,581
Shares issued to
shareholders in
distributions
reinvested.......... -- 46,253 -- 429,688
Cost of shares
redeemed.............. (67,818) (4,680) (644,043) (45,139)
-------- -------- ---------- ------------
Increase in net
assets resulting
from capital
share transactions.. (324,091) 770,903 3,209,053 7,024,130
========= ========= ------------ -----------
Net increase in net assets............... 4,286,925 7,174,718
Net assets:
Beginning of period.................... 7,285,010 110,292
End of period (including undistributed
net investment income of $62,153 and
overdistributed net investment
income of $10,203, respectively)......... $ 11,571,935 $7,285,010
============ ===========
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
SELECTED PER SHARE DATA AND RATIOS
Year Ended December 31,
1996 1995 1994
---------------------------------
Investment income........................ $0.15 $0.89 $0.22
Expenses, net............................ 0.09 0.32 2.20
---------------------------------
Net investment income (loss)............. 0.06 0.57 (1.98)
Net realized and unrealized
gain on investments..................... 1.08 0.13 --
Distributions to shareholders:
From net investment
income................................ -- (0.58) --
From net realized gain
on investments........................ -- -- --
---------------------------------
Net increase (decrease)
in net asset value...................... 1.14 0.12 (1.98)
Net asset value:
Beginning of period..................... 9.31 9.19 11.17
================================
End of period........................... $10.45 $9.31 $9.19
================================
Ratio of expenses to
average net assets...................... 1.10% 1.11% 20.12%
Ratio of net investment in-
come (loss) to average net assets....... 0.85% 2.01% (18.13)%
Portfolio turnover....................... 0.20 0.33 --
Number of shares out-
standing at end of period............... 1,106,994 782,903 12,000
Per share data and ratios assuming no
waiver of advisory fees:
Expenses................................. -- -- $ 2.28
Net investment loss...................... -- -- $ (2.06)
Ratio of expenses to
average net assets...................... -- -- 20.87%
Ratio of net investment loss
to average net assets.................. -- -- (18.88)%
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1996
Value
Quantity (Note 1)
COMMON STOCKS -- 60.39%
Canadian Energy Industry -- 12.35%
10,000 Anderson Exploration Limited................... $ 129,200
6,000 Imperial Oil Limited........................... 283,500
15,000 Rennaissance Energy............................ 514,800
15,000 Talisman Energy Limited....................... 502,800
----------
1,430,300
----------
Coal/Alternate Energy Industry -- 4.28%
15,000 Calenergy Company Incorporated................. 495,000
----------
Gold/Diamond (South African) Indusrty -- 1.24%
5,000 De Beers Consolidated Mines Limited............ 143,125
----------
Gold/Silver Mining Stocks -- 16.20%
15,000 Franco-Nevada Mining Corporation............... 668,100
10,208 Freeport McMoRan Copper & Gold, Class A........ 287,100
40,000 Miramar Mining Corporation..................... 175,200
30,000 Northern Orion Exploration Limited............. 110,700
15,000 Stillwater Mining Company...................... 271,875
16,000 Teck Corporation Class B....................... 362,240
----------
1,875,215
----------
Petroleum (Integrated) Industry -- 6.58%
3,000 Amoco Corporation.............................. 245,625
2,000 Atlantic Richfield Company..................... 269,250
2,000 Mobil Oil Corporation.......................... 246,250
----------
761,125
----------
Petroleum Producing Industry -- 3.58%
12,000 Apache Corporation............................. 414,000
----------
Oilfield Services/Equipment Indusrty --5.34%
6,100 Schlumberger Limited........................... 617,625
----------
Metals & Mining (Diversified) Indusrty --2.32%
12,000 Noranda Incorporated........................... 268,080
----------
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1996
(Continued)
Value
Quantity (Note 1)
Environmental Indusrty --1.72%
8,000 Cominco Limited................................ 199,000
----------
Metals & Mining (Diversified) Industry -- 6.78%
5,000 Aluminum Company of America.................... 316,875
5,000 Phelps Dodge Corporation....................... 339,375
2,000 RTZ Corporation PLC, ADR....................... 128,000
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784,250
----------
Total common stocks (cost $5,485,250).......... 6,987,720
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FOREIGN TIME DEPOSITS -- 10.79%
1,947,405Deutsche Mark, maturing 01/03/97,
at 3.375%..................................... 1,249,455
----------
Total foreign time deposits (cost $1,251,208).. 1,249,455
----------
U.S. TREASURY BILLS -- 25.57%
$3,000,00Treasury Bill, 5.01% yield, maturing 2/27/97
(at cost)...................................... 2,959,208
----------
Total investments (cost $9,695,666)............ 11,196,383
----------
CASH & OTHER ASSETS, LESS LIABILITIES -- 3.25%.......... 375,552
-----------
Total Net Assets............................... $11,571,935
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<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
1. Significant accounting policies:
Anchor Resource and Commodity Trust (the "Trust"), a Massachusetts business
trust is registered under the Investment Company Act of 1940, as amended, as
a diversified, open-end investment management company. The following is a
summary of significant accounting policies followed by the Trust which are in
conformity with those generally accepted in the investment company industry.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. A. Investment securities--
Security transactions are recorded
on the date the investments are purchased or sold. Each day, at noon,
securities traded on national security exchanges are valued at the last sale
price on the primary exchange on which they are listed, or if there has been
no sale by noon, at the current bid price. Other securities for which market
quotations are readily available are valued at the last known sales price,
or, if unavailable, the known current bid price which most nearly represents
current market value. Temporary cash investments are stated at cost, which
approximates market value. Dividend income is recorded on the ex-dividend
date and interest income is recorded on the accrual basis. Gains and losses
from sales of investments are calculated using the "identified cost" method
for both financial reporting and federal income tax purposes.
B. Income Taxes-- The Trust has elected to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and
to distribute each year all of its taxable income to its shareholders. No
provision for federal income taxes is necessary since the Trust intends to
qualify for and elect the special tax treatment afforded a "regulated
investment company" under subchapter M of the Internal Revenue Code.
C. Capital Stock-- The Trust records sales and redemptions of
its capital stock on trade date.
D. Foreign Currency-- Amounts denominated in or expected to settle in foreign
currencies are translated into United States dollars at rates reported by a
major Boston bank on the following basis:
A. Market value of investment securities, other assets and
liabilities at the 12:00 noon Eastern Time rate of exchange
at the balance sheet date.
B. Purchases and sales of investment securities, income and expenses at the
rate of exchange prevailing on the respective dates of such transactions (or
at an average rate if significant rate fluctuations have not occurred).
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
(Continued)
The Trust does not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss
from investments. Reported net realized foreign exchange gains or losses
arise from sales and maturities of short term securities, sales of foreign
currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on
the Trust's books, and the United States dollar equivalent of the amounts
actually received or paid. Net unrealized foreign exchange gains and losses
arise from changes in the value of assets and liabilities other than
investments in securities at fiscal year end, resulting from changes in the
exchange rate.
2. Tax basis of investments:
At December 31, 1996, the total cost of investments for federal income tax
purposes was identical to the total cost on a financial reporting basis.
Aggregate gross unrealized appreciation in investments in which there was an
excess of market value over tax cost was $1,627,280. Aggregate gross
unrealized depreciation in investments in which there was an excess of tax
cost over market value was $126,563. Net unrealized appreciation in
investments at December 31, 1996 was $1,500,717.
3. Investment advisory service agreements:
The investment advisory contract with Anchor Investment Management
Corporation (the "investment adviser") provides that the Trust will pay the
adviser a fee for investment advice based on 3/4 of 1% per annum of average
daily net assets. At December 31, 1996, investment advisory fees of $7,302
were due which were included in "Accrued expenses and other liabilities" in
the accompanying Statement of Assets and Liabilities. David Y. Williams, a
Trustee of the Trust, is President and a Director of the Investment Adviser.
4. Certain transactions:
Anchor Investment Management Corporation provides transfer agent services for
the Trust. Fees earned by Anchor Investment Management Corporation for
transfer agent services for the year ended December 31, 1996 were $1,000.
Certain officers and trustees of the Trust are directors and/or officers of
the investment adviser and distributor. Meeschaert & Co., Inc. the Trust's
distributor, received $4,078 in brokerage commissions during the year ended
December 31, 1996. Fees earned by Anchor Investment Management Corporation
for expenses related to daily pricing of the Trust shares and for bookkeeping
services for the year ended December 31, 1996 were $6,000.
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
(Continued)
5. Purchases and sales:
Aggregate cost of purchases and the proceeds from sales and maturities on
investments for year ended December 31, 1996 were:
Cost of securities acquired:
U.S. Government and investments backed by
such securities........................... $ 2,959,208
Other investments....................... 99,866,140
=============
$ 102,825,348
=============
Proceeds from sales and maturities:
U.S. Government and investments backed by
such securities........................... $ --
Other investments....................... 98,941,294
=============
$ 98,941,294
=============
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Trustees of Anchor Resource and
Commodity Trust:
We have audited the accompanying statement of assets and liabilities of Anchor
Resource and Commodity Trust (a Massachusetts business trust), including the
schedule of investments, as of December 31, 1996, the related statement of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended, and the selected per share data
and ratios for each of the three years in the period then ended. These financial
statements and per share data and ratios are the responsibility of the Trust's
management. Our responsibility is to express an opinion on these financial
statements and per share data and ratios based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and per share data
and ratios are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1996 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and selected per share data and ratios
referred to above present fairly, in all material respects, the financial
position of Anchor Resource and Commodity Trust as of December 31, 1996, the
results of its operations for the year then ended, the changes in its net assets
for each of the two years in the period then ended, and the selected per share
data and ratios for each of the three years in the period then ended, in
conformity with generally accepted accounting principles.
LIVINGSTON & HAYNES, P.C.
Wellesley, Massachusetts,
January 17, 1997.
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
OFFICERS AND TRUSTEES
DAVID W.C. PUTNAM Chairman
Chairman, Board of Directors, F.L. Putnam and Trustee
Investment Management Corporation
President and Director, F.L. Putnam
Securities Company Incorporated
J. STEPHEN PUTNAM Vice President and
President, Robert Thomas Securities Treasurer
SPENCER H. LE MENAGER Secretary
President, Equity Inc. and Trustee
MAURICE A. DONAHUE Trustee
Director and Professor, Institute for
Governmental Services and
Walsh-Saltonstall Professor of Practical
Politics, University of Massachusetts
DAVID Y. WILLIAMS President
President and Director, Meeschaert & Co., and Trustee
Inc.,
President and Director, Anchor Investment
Management Corporation
<PAGE>
ANCHOR RESOURCE AND COMMODITY TRUST
INVESTMENT ADVISER AND TRANSFER AGENT
Anchor Investment Management Corporation
2717 Furlong Rd., Doylestown, Pennsylvania 18901
(215) 794-2980
DISTRIBUTOR
Meeschaert & Co., Inc.
2717 Furlong Rd., Doylestown, Pennsylvania 18901
CUSTODIAN
Investors Bank & Trust Company
89 South Street, Boston, Massachusetts 02111
INDEPENDENT PUBLIC ACCOUNTANT
Livingston & Haynes, P.C.
40 Grove St., Wellesley, Massachusetts 02181
LEGAL COUNSEL
Yukevich, Blume, Marchetti & Zangrilli
One Gateway Center, Pittsburgh, Pennsylvania 15222
