<PAGE> 1
FAIRPORT FUNDS
Charting A Course You Can Trust(SM)
SEMI-ANNUAL REPORT TO
SHAREHOLDERS
[LOGO] FAIRPORT MIDWEST GROWTH FUND
[LOGO] FAIRPORT GROWTH AND INCOME FUND
[LOGO] FAIRPORT GOVERNMENT SECURITIES FUND
[LOGO] April 30, 1999
Advised by
Roulston & Company, Inc.
<PAGE> 2
FAIRPORT FUNDS SEMI-ANNUAL REPORT TO SHAREHOLDERS
- --------------------------------------------------------------------------------
May 17, 1999
Dear Shareholder:
We are pleased to issue our financial report on the Fairport Funds six months,
ended April 30, 1999.
During the period, the Fairport Midwest Growth Fund declined 5.54% and the
Fairport Growth and Income Fund gained 10.63%. These returns were earned in a
period when the market, as measured by the Standard & Poor's 500 Stock Index
gained 21.5%. The Fairport Government Securities Fund declined 1.19% over the
same period.
While doubts about the health of the world economy persisted during much of the
six-month period, U.S. economic growth continued to outpace expectations.
Consumer spending reflected optimism brought on by low inflation and full
employment.
Easier monetary conditions set in place last October also helped to calm some of
the fears that developed last summer and fall in the wake of the Asian and
Russian crises. As the period came to a close, economic and financial market
returns in most Asian and Latin markets offered further constructive evidence
that more favorable trends were in place.
Our commentary reflects our long-held philosophy that solid and unrelenting
research must form the cornerstone of our investment process. Our research
efforts for the Fairport Funds continue to give us confidence in the future of
the economy and the portfolios we manage on your behalf.
/s/ Scott D. Roulston /s/ Joseph A. Harrison
Scott D. Roulston Joseph A. Harrison
President Director of Investments
<PAGE> 3
FAIRPORT FUNDS INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
FAIRPORT MIDWEST GROWTH FUND
The graph below compares the increase in value of a $10,000 investment in
Fairport Midwest Growth Fund with the performance of the Standard & Poor's 500
Stock Index and the Growth Funds (Lipper Benchmark).
[FAIRPORT MIDWEST GROWTH FUND: GROWTH OF A HYPOTHETICAL $10,000 INVESTMENT
GRAPH]
<TABLE>
Fairport Midwest Growth Fund Growth Funds (Lipper Benchmark) S&P 500 Index
<S> <C> <C> <C>
7/1/93 10000 10000 10000
Jul-93 10200 9998 9970
Oct-93 11000 10653 10480
Jan-94 11730 11088 10497
Apr-94 11847 10479 10100
Jul-94 11790 10457 10482
Oct-94 12208 10871 10880
Jan-95 12222 10587 10914
Apr-95 13327 11631 12019
Jul-95 14950 13127 13207
Oct-95 14532 13478 13750
Jan-96 14514 14271 15127
Apr-96 16584 14989 15641
Jul-96 15785 14292 15385
Oct-96 16807 16255 17047
Jan-97 18638 17301 19107
Apr-97 18404 17103 19563
Jul-97 22065 20542 23395
Oct-97 22135 20121 22528
Jan-98 22374 21154 24243
Apr-98 24286 24047 27592
Jul-98 22970 23628 27911
Oct-98 20425 22409 27475
Jan-99 20965 26692 32113
Apr-99 19292 27494 33611
</TABLE>
AVERAGE ANNUAL TOTAL RETURN*
1 Year ............................ (20.56)%
5 Years ........................... 10.24%
Since Inception ................... 11.92%
* For period ended 4/30/99
Fund Inception: 7/1/93
Past Performance is no guarantee of future results. The principal value and
return of a mutual fund investment fluctuates with changes in market conditions.
Shares, when redeemed, may by worth more or less than the original cost. *Growth
Funds tracked by Lipper Analytical Services, Inc. The S&P 500 Index and Lipper
Benchmark are unmanaged indicators of financial performance and as such are not
sold as investments. Unlike our funds, the S&P 500 Index does not reflect any
fees or expenses.
The Fairport Midwest Growth Fund seeks capital appreciation by investing
primarily in companies headquartered in the eight-state area contiguous to the
Great Lakes. Up to 35% of the Fund also may be invested in companies
headquartered in other geographic areas.
The companies in which we invest typically are experiencing an improvement in
profitability or acceleration in growth of earnings relative to other companies.
We buy the specific stocks if this improvement is not yet fully reflected in the
stock price, which is determined by examining the P/E ratio compared to the
market and the history of that relationship.
Frequently, the companies in which we invest possess a unique asset or approach.
Many times, they may be a beneficiary of major demographic or economic trends.
We are looking for investment circumstances where earnings growth may accelerate
and the P/E ratio increases relatively. We believe in fundamental analysis,
selectivity, price sensitivity, and long term performance.
Two examples of our recent purchase are Claire's Stores and MBNA. Claire's
Stores sells costume jewelry and related products through small stores located
primarily in the United States. Management has initiated a number of actions to
improve profitability and prolong growth.
However, demographically, it is also true that their customer base is increasing
in numbers currently, which is the opposite of the operating environment of the
previous ten years. In addition, since purchases by customers are very
discretionary, it is important that economic conditions be solid for consumers,
which also is the case currently.
MBNA is a leading issuer of credit cards and the major marketer of affinity
cards. Credit card usage nationally still is increasing faster than the economy
and MBNA's growth should exceed that of the industry. The company's focus on a
niche market has provided a more affluent and attractive customer base that, for
example, maintains above-average balances. In addition, many customers appear
open to the marketing of other products such as insurance.
Currently, the fund owns 40 securities. The average P/E ratio for the portfolio
is less than that of the S&P 500 Index while profitability and projected growth
in earnings is greater. If the market continues to broaden its interest beyond
the 50 largest companies, the Fund is positioned to participate.
1
<PAGE> 4
FAIRPORT FUNDS
- --------------------------------------------------------------------------------
FAIRPORT GROWTH AND INCOME FUND
The graph below compares the increase in value of a $10,000 investment in
Fairport Growth and Income Fund with the performance of the Standard & Poor's
500 Stock Index and the Growth and Income Funds (Lipper Benchmark).
[FAIRPORT GROWTH & INCOME FUND: GROWTH OF A HYPOTHETICAL $10,000 INVESTMENT
GRAPH]
<TABLE>
Fairport Growth & Income Fund Growth & Income Funds (Lipper Benchmark) S&P 500 Index
<S> <C> <C> <C>
7/1/93 10000 10000 10000
Jul-93 10030 10054 9970
Oct-93 10398 10606 10480
Jan-94 10894 11051 10862
Apr-94 10682 10478 10241
Jul-94 10900 10677 10482
Oct-94 10889 10941 10880
Jan-95 10940 10778 10914
Apr-95 11746 11759 12019
Jul-95 12541 12799 13207
Oct-95 12780 13125 13750
Jan-96 14075 14314 15127
Apr-96 14149 14980 15641
Jul-96 13749 14540 15305
Oct-96 15051 17004 17054
Jan-97 16558 17590 19107
Apr-97 17167 17753 19563
Jul-97 20353 20924 23395
Oct-97 20560 20414 22528
Jan-98 20900 21395 24243
Apr-98 23227 24032 27592
Jul-98 21437 23310 27911
Oct-98 20312 22463 27475
Jan-99 21525 24820 32113
Apr-99 22471 26284 33611
</TABLE>
AVERAGE ANNUAL TOTAL RETURN*
1 Year ............................ (3.25)%
5 Years ........................... 16.03%
Since Inception ................... 14.89%
* For period ended 4/30/99
Fund Inception: 7/1/93
Past Performance is no guarantee of future results. The principal value and
return of a mutual fund investment fluctuates with changes in market conditions.
Shares, when redeemed, may by worth more or less than the original cost. *Growth
& Income Funds tracked by Lipper Analytical Services, Inc. The S&P 500 Index and
Lipper Benchmark are unmanaged indicators of financial performance and as such
are not sold as investments. Unlike our funds, the S&P 500 Index does not
reflect any fees or expenses.
Fairport Growth and Income Fund was established to achieve capital appreciation
and current income primarily through the investment in common stocks or
securities convertible into common stocks.
The investment policy is to invest in a diversified portfolio of dividend-paying
common stocks which have been researched by our own staff and offer reasonable
valuation based on price to earnings, book value and cash flows.
Two examples of our investment approach are Charter One Financial and Honeywell.
Charter One Financial, a former thrift, operates 220 banking offices in the
Midwest. It is differentiating itself from the industry with above average
earnings growth of 13-16% through superior expense skills and, more importantly,
the ability to achieve growth in loan categories other than mortgages. This has
the effect of enhancing profitability. Management's proven ability to execute
its strategies for internal growth as well as enhance the performance of its
acquisitions suggests this will be a fine investment, selling at less than half
the P/E Ratio of the market.
Honeywell is a leader in Controls for Industrial, Aviation, and Building sectors
and is experiencing solid growth and rising margins. The bigger story, however,
is that Honeywell is using technology to separate itself from competitors. The
recent $250 million process automation order for single Chevron Refinishing is
one example. In Aviation, Tactical Guidance has booked all the awards announced
so far. The stock was available at a very attractive price of nearly 50% of the
market P/E.
The Fund is diversified among 30 investments with a concentration in capital
goods, finance and consumer cyclicals, which should benefit from a steadily
strong economy. The characteristics of this portfolio are quality companies,
displaying an ability to grow, available at a value price at the time of
purchase.
2
<PAGE> 5
INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
FAIRPORT GOVERNMENT SECURITIES FUND
The graph below compares the increase in value of a $10,000 investment in
Fairport Government Securities Fund with the performance of the Merrill Lynch
Intermediate Treasury Bond Index.
[FAIRPORT GOVERNMENT SECURITIES FUND: GROWTH OF A HYPOTHETICAL $10,000
INVESTMENT GRAPH]
<TABLE>
<CAPTION>
Fairport Government Securities Fund Merrill Lynch Intermediate
<S> <C> <C>
7/1/93 10000 10000
Jul-93 10000 10021
Oct-93 10304 10235
Jan-94 10346 10328
Apr-94 9649 9970
Jul-94 9748 10112
Oct-94 9558 10064
Jan-95 9733 10219
Apr-95 10170 10591
Jul-95 10628 10973
Oct-95 10968 11262
Jan-96 11350 11618
Apr-96 10989 11396
Jul-96 11093 11537
Oct-96 11471 11886
Jan-97 11545 12012
Apr-97 11569 12098
Jul-97 12046 12527
Oct-97 12246 12757
Jan-98 12575 13069
Apr-98 12588 13242
Jul-98 12810 13387
Oct-98 13545 14008
Jan-99 13546 14075
Apr-99 13384 14003
</TABLE>
AVERAGE ANNUAL TOTAL RETURN*
1 Year ............................ 6.33%
5 Years ........................... 6.76%
Since Inception ................... 5.12%
* For period ended 4/30/99
Fund Inception: 7/1/93
Past Performance is no guarantee of future results. The principal value and
return of a mutual fund investment fluctuates with changes in market conditions.
Shares, when redeemed, may by worth more or less than the original cost. *The
Merrill Lynch Intermediate Treasury Bond Index is an unmanaged indicator of
financial performance and as such is not sold as an investment. Unlike our
funds, this index does not reflect any fees or expenses.
In order to meet its objective of current income with preservation of capital,
the Government Securities Fund seeks to complement the Equity Funds that
combined form the Fairport Family of Funds. This is achieved through investments
in a broad range of investment grade or comparable quality fixed income
securities. The Fund will further minimize credit risk by normally having at
least 65% of the assets invested in securities guaranteed by the US Government
or its agencies and instrumentalities. While changes in interest rates affect
the Fund's holdings, the primary focus of the portfolio is to provide a strategy
that reflects the use of quantitative analysis, changing market environments and
infrastructure, and addresses the degree of risk and yield necessary in
preserving liquidity and safety of principal.
There is growing evidence that both Europe and Asia are showing signs of
economic stability, and though marginal at best, there is growth on the horizon.
This will reduce the probabilities of a significant rally in bonds before the
end of the year. The various crises that drove the headlines last summer
produced the abundant belief that the downward trend in inflation the global
economy was experiencing up to that point would be accelerated to produce
deflation. Federal Reserve Bank Chairman Greenspan supported this notion in
numerous comments.
In the span of two quarters investor sentiment shifted as a growing body of
evidence emerged to counteract the deflationary story. A rapid rise of interest
rates occurred with the repeated release of economic statistics revealing a
stronger than expected domestic economy. These included ongoing productivity and
capacity utilization strength, a decline in the civilian unemployment rate to
4.2%, a level not seen in over 30 years, as well as strong consumer activity.
All this served to fuel growing concerns that future inflationary trends would
force Chairman Greenspan to initiate a rise in interest rates.
In preparing for this possibility the Fund raised cash in the beginning of the
second quarter to soften the impact of rising rates and to be prepared to
reinvest at higher yields. As rates continued to rise government securities
underperformed relative to quality spread products, especially corporate bonds.
This trend is likely to continue until either the Federal Reserve takes a
tightening stand or the equity markets retreat amid the increasing concerns
regarding higher interest rates. In the near term, forecasting the ceiling for
long rates is tricky business, however the bond market is, by most measures,
undervalued. In short, we currently find the oversold conditions of the market
hard to ignore.
Therefore going forward it is likely that when rates show signs of stabilizing
it will be government securities that will benefit from any corrective behavior.
The fund will prepare by maintaining an average maturity beyond five years. This
part of the yield curve will reap relative benefits in the event of some relief
in inflation expectations or an outright tightening by the Federal Reserve Bank.
3
<PAGE> 6
FAIRPORT FUNDS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FAIRPORT MIDWEST GROWTH FUND (UNAUDITED) APRIL 30, 1999
========================================================================
SHARES VALUE
- ------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS - 101.75%
CAPITAL GOODS - 3.23%
Applied Power, Inc., Class A .... 20,100 $ 634,406
General Cable Corp .............. 42,200 627,725
Gradall Industries, Inc.* ....... 19,700 315,200
-----------
1,577,331
- -----------------------------------------------------------------------
CONSUMER DURABLES - 1.62%
Lowe's Companies, Inc. .......... 15,000 791,250
- -----------------------------------------------------------------------
CONSUMER NON-DURABLES - 20.07%
Abercrombie & Fitch Co., Class A* 12,000 1,141,500
Carnival Corp. .................. 12,000 495,000
Claire's Stores, Inc. ........... 92,000 3,047,500
Kmart Corp.* .................... 102,000 1,517,250
Procter & Gamble Co. ............ 12,000 1,125,750
Rite Aid Corp. .................. 50,000 1,165,625
The Limited, Inc. ............... 30,000 1,312,500
-----------
9,805,125
- -----------------------------------------------------------------------
FINANCE - 24.60%
Bank One Corp. .................. 19,200 1,132,800
Boykin Lodging Co. .............. 60,000 918,750
Firstar Corp. ................... 49,080 1,475,467
Freddie Mac ..................... 30,000 1,882,500
Household International, Inc. ... 10,000 503,125
MBNA Corp. ...................... 30,000 845,625
National City Corp. ............. 22,000 1,578,500
Progressive Corp. ............... 10,000 1,435,000
Wells Fargo Co. ................. 52,000 2,245,750
-----------
12,017,517
- -----------------------------------------------------------------------
HEALTH CARE - 24.18%
Abbott Laboratories ............. 20,000 968,750
Baxter International, Inc. ...... 15,000 945,000
Cardinal Health, Inc. ........... 25,000 1,495,313
Merck & Co., Inc. ............... 6,000 421,500
NCS Healthcare, Inc., Class A* .. 73,400 954,200
Patterson Dental Co.* ........... 80,000 2,885,000
Pfizer, Inc. .................... 6,000 690,375
Stryker Corp. ................... 56,400 3,450,975
-----------
11,811,113
- -----------------------------------------------------------------------
</TABLE>
4
<PAGE> 7
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS (CONT.)
MATERIALS/SERVICES - 15.08%
AlliedSignal, Inc. ..................................... 30,000 $ 1,762,500
Armco, Inc.* .......................................... 220,000 1,127,500
Paychex, Inc. .......................................... 29,000 1,480,813
Stericycle, Inc.* ...................................... 116,700 1,371,225
Tyco International, Ltd. ............................... 20,000 1,625,000
------------
7,367,038
- -------------------------------------------------------------------------------------------------
TECHNOLOGY - 12.97%
Computer Sciences Corp.* ............................... 15,000 893,437
Galileo International, Inc. ............................ 25,000 1,225,000
Lexmark International Group, Inc., Class A* ............ 10,000 1,235,000
Microsoft Corp.* ....................................... 5,000 406,563
Oracle Corp.* .......................................... 20,000 541,250
Sterling Commerce, Inc.* ............................... 30,000 939,375
Tellabs, Inc.* ......................................... 10,000 1,095,625
------------
6,336,250
- --------------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS - (COST $43,566,430) ............... 49,705,624
- --------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS - 101.75% - (COST $43,566,430**) ..... 49,705,624
LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS - (1.75%) (852,869)
NET ASSETS - 100.00% ................................... $ 48,852,755
==================================================================================================
</TABLE>
* Non-income producing security
** Also represents cost for Federal income tax purposes
See accompanying notes to financial statements
5
<PAGE> 8
FAIRPORT FUNDS
<TABLE>
<CAPTION>
FAIRPORT GROWTH AND INCOME FUND (UNAUDITED) APRIL 30, 1999
=============================================================================================================
SHARES VALUE
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS - 100.17%
CAPITAL GOODS - 27.07%
Applied Power, Inc., Class A 60,000 $ 1,893,750
GATX Corp. .................................. 34,000 1,168,750
General Cable Corp. ......................... 180,000 2,677,500
Honeywell, Inc. ............................. 24,000 2,274,000
Ingersoll-Rand Co. .......................... 21,000 1,452,937
Teleflex, Inc. .............................. 34,000 1,481,125
-----------
10,948,062
- -------------------------------------------------------------------------------------------------------------
CONSUMER DURABLES - 10.21%
Hon Industries, Inc. ........................ 24,000 648,000
Leggett & Platt, Inc. ....................... 70,000 1,614,375
Lowe's Companies, Inc. ...................... 20,000 1,055,000
Pier 1 Imports, Inc. ........................ 110,000 811,250
-----------
4,128,625
- -------------------------------------------------------------------------------------------------------------
CONSUMER NON-DURABLES - 22.58%
Carnival Corp., ............................. 20,000 825,000
Claire's Stores, Inc. ....................... 50,000 1,656,250
Food Lion, Inc., Class A .................... 100,000 1,025,000
McCormick & Co., Inc. ....................... 30,000 909,375
Richfood Holdings, Inc. ..................... 80,000 1,000,000
Rite Aid Corp. .............................. 42,000 979,125
Russ Berrie & Co., Inc. ..................... 40,000 1,085,000
Viad Corp. .................................. 50,000 1,653,125
-----------
9,132,875
- -------------------------------------------------------------------------------------------------------------
FINANCE - 28.72%
American International Group, Inc. .......... 10,000 1,174,375
Charter One Financial, Inc.. ................ 62,000 1,937,500
M & T Bank Corp. ............................ 3,000 1,677,000
National City Corp. ......................... 24,000 1,722,000
Progressive Corp. ........................... 10,000 1,435,000
The Bank of New York Co., Inc. .............. 30,000 1,200,000
U.S. Bancorp ................................ 20,000 741,250
Wells Fargo Co. ............................. 40,000 1,727,500
-----------
11,614,625
- -------------------------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE> 9
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
- --------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONT.)
<S> <C> <C>
Health Care - 4.32%
Baxter International, Inc. ................................ 10,000 $ 630,000
Becton, Dickinson & Co. ................................... 30,000 1,115,625
------------
1,745,625
- --------------------------------------------------------------------------------------------------------------
Technology - 7.27%
Dallas Semiconductor Corp. ................................ 30,000 1,275,000
Galileo International, Inc. ............................... 34,000 1,666,000
------------
2,941,000
- --------------------------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS-- (COST $32,678,650) .................. 40,510,812
- --------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS - 100.17%-- (COST $32,678,650**) ........ 40,510,812
LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS - (0.17%) .. (67,820)
------------
NET ASSETS - 100.00% ...................................... $40,442,992
============
==============================================================================================================
</TABLE>
** Also represents cost for Federal income tax purposes
See accompanying notes to financial statements
7
<PAGE> 10
FAIRPORT FUNDS SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FAIRPORT GOVERNMENT SECURITIES FUND (UNAUDITED) APRIL 30, 1999
===========================================================================================================================
PRINCIPAL VALUE
AMOUNT
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
BONDS- 31.48%
U.S. Government Agency 28.99%
Federal Home Loan Bank
5.85%, 04/15/05 ................................................ 1,200,000 $1,208,932
- -------------------------------------------------------------------------------------------------------------
U.S. Treasury Notes - 2.49%
U.S. Treasury Notes
6.63%, 03/31/02 ................................................ 100,000 103,823
- -------------------------------------------------------------------------------------------------------------
TOTAL BONDS - (COST $1,307,573) ................................. 1,312,755
- -------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT - 36.64%
UMB Bank, Fannie Mae Discount Note, $1,560,000
par, 0% coupon, due 05/04/99, dated 04/30/99
to be sold on 05/01/99 at $1,528,193 (Cost $1,528,000) ..... 1,528,000 1,528,000
- -------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS - 68.12% - (COST $2,835,573**) ................ 2,840,755
CASH AND OTHER ASSETS LESS LIABILITIES - 31.88% ................. 1,329,761
----------
NET ASSETS - 100.00% ............................................ $4,170,516
==========
=============================================================================================================
</TABLE>
** Also represents cost for Federal income tax purposes
See accompanying notes to financial statements
8
<PAGE> 11
FAIRPORT FUNDS STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
APRIL 30, 1999 (UNAUDITED)
===========================================================================================================================
FAIRPORT FAIRPORT FAIRPORT
MIDWEST GROWTH GROWTH AND GOVERNMENT
FUND INCOME FUND SECURITIES FUND
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS:
Investments in securities at value (cost $43,566,430,
$32,678,650 and $2,835,573, respectively) ...... $ 49,705,624 $ 40,510,812 $ 2,840,755
Cash ................................................ 0 0 1,528,914
Receivable for capital stock sold ................... 81,454 140,746 0
Receivable for securities sold ...................... 752,709 1,024,528 1,341,721
Dividends and interest receivable ................... 61,018 32,340 4,109
Reimbursement due from adviser, net ................. 0 0 4,166
Deferred organizational costs (Note A) .............. 3,115 3,115 3,115
Other assets ........................................ 11,419 5,731 912
------------ ------------ ------------
Total assets ................................... 50,615,339 41,717,272 5,723,692
------------ ------------ ------------
LIABILITIES:
Payable for capital stock redeemed .................. 64,834 303,239 0
Payable for securities purchased .................... 1,134,195 390,600 1,528,000
Accrued expenses .................................... 47,079 19,451 9,394
Payable to adviser, net ............................. 20,086 25,149 0
Distributions payable ............................... 0 0 15,782
Other liabilities ................................... 496,390 535,841 0
------------ ------------ ------------
Total liabilities .............................. 1,762,584 1,274,280 1,553,176
------------ ------------ ------------
NET ASSETS:
Applicable to 3,683,328, 2,430,214 and
414,036 shares outstanding, respectively ....... $ 48,852,755 $ 40,442,992 $ 4,170,516
============ ============ ===========
NET ASSETS CONSIST OF:
Capital paid-in ..................................... $ 43,786,990 $ 30,144,646 $ 4,142,456
Distributions in excess of net investment income .... (190,648) (18,988) 0
Accumulated net realized gain (loss) on investments . (882,781) 2,485,172 22,878
Net unrealized appreciation on investments .......... 6,139,194 7,832,162 5,182
------------ ------------ ------------
$ 48,852,755 $ 40,442,992 $ 4,170,516
============ ============ ===========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE ..................... $ 13.26 $ 16.64 $ 10.07
============ ============ ===========
===========================================================================================================================
</TABLE>
See accompanying notes to financial statements
9
<PAGE> 12
FAIRPORT FUNDS STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FORTHE SIX MONTHS ENDED APRIL 30,1999 (UNAUDITED)
============================================================================================================
FAIRPORT FAIRPORT FAIRPORT
MIDWEST GROWTH AND GOVERNMENT
GROWTH FUND INCOME FUND SECURITIES FUND
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment Income:
Dividends ........................................... $ 344,304 $ 272,812 $ 0
Interest ............................................ 63,517 61,437 134,702
----------- ----------- -----------
Total investment income ......................... 407,821 334,249 134,702
----------- ----------- -----------
EXPENSES:
Investment advisory fees (Note B) ................... 219,862 160,286 6,044
Distribution expenses (Note B) ...................... 73,287 53,429 6,044
Administration fees ................................. 40,983 22,334 3,081
Transfer agent fees ................................. 29,097 23,021 12,871
Legal fees .......................................... 8,875 5,121 0
Pricing fees ........................................ 21,064 15,586 12,395
Registration expenses ............................... 9,220 3,709 3,886
Custodian fees ...................................... 10,580 9,382 4,122
Printing fees ....................................... 7,185 3,972 393
Auditing fees ....................................... 6,582 4,686 211
Insurance fees ...................................... 10,352 5,135 772
Trustees fees ....................................... 3,747 2,832 308
Amortization of organizational costs (Note A) ....... 1,540 1,540 1,540
Miscellaneous expenses .............................. 5,289 1,870 102
----------- ----------- -----------
Total expenses .................................. 447,663 312,903 51,769
Expenses reimbursed (Note B) ........................ (43,117) (3,550) (30,009)
----------- ----------- -----------
Net expenses .................................... 404,546 309,353 21,760
----------- ----------- -----------
NET INVESTMENT INCOME ............................... 3,275 24,896 112,942
REALIZED AND UNREALIZED GAIN / (LOSS) ON INVESTMENTS:
Net realized gain / (loss) on investments ........... (252,179) 3,209,805 41,979
Net change in unrealized
appreciation (depreciation) on investments ...... (2,679,128) 598,937 (217,789)
----------- ----------- -----------
Net realized and unrealized
gain / (loss) on investments .................... (2,931,307) 3,808,742 (175,810)
----------- ----------- -----------
INCREASE/(DECREASE) IN
NET ASSETS FROM OPERATIONS ...................... $(2,928,032) $ 3,833,638 $ (62,868)
=========== =========== ===========
============================================================================================================
</TABLE>
See accompanying notes to financial statements
10
<PAGE> 13
FAIRPORT FUNDS STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
====================================================================================================================================
FAIRPORT MIDWEST FAIRPORT GROWTH FAIRPORT GOVERNMENT
GROWTH FUND AND INCOME FUND SECURITIES FUND
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended Year Six Months Ended Year Six Months Ended Year
4/30/99 Ended 4/30/99 Ended 4/30/99 Ended
(Unaudited) 10/31/98 (Unaudited) 10/31/98 (Unaudited) 10/31/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ............... $ 3,275 $ (102,535) $ 24,896 $ 5,722 $ 112,942 $ 231,748
Net realized gain / (loss) on investments .. (252,179) 9,390,471 3,209,805 1,978,014 41,979 85,201
Net change in unrealized appreciation
(depreciation) on investments ......... (2,679,128) (14,925,981) 598,937 (2,771,879) (217,789) 162,209
------------ ------------ ------------ ------------ ----------- -----------
Increase / Decrease in net assets ......... (2,928,032) (5,638,045) 3,833,638 (788,143) (62,868) 479,158
------------ ------------ ------------ ------------ ----------- -----------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income ................. 0 0 (22,171) 0 (112,908) (231,782)
From net realized gains .................... (10,062,251) (4,536,145) (2,716,374) 0 0
------------ ------------ ------------ ------------ ----------- -----------
Total distributions ........................ (10,062,251) (4,536,145) (2,738,545) (112,908) (231,782)
------------ ------------ ------------ ------------ ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold .................. 5,935,894 14,584,017 21,274,550 12,962,111 1,551,445 2,498,395
Reinvestment of dividends .................. 9,955,688 4,489,221 1,813,268 3,167,253 85,733 225,548
Amount paid for repurchase of shares ....... (19,435,675) (20,529,323) (16,786,857) (9,863,545) (2,347,642) (2,325,367)
------------ ------------ ------------ ------------ ----------- -----------
Net increase (decrease)
from capital transactions ................ (3,544,093) (1,456,085) 6,300,961 6,265,819 (710,464) 398,576
------------ ------------ ------------ ------------ ----------- -----------
Total increase (decrease) in net assets .... (16,534,376) (11,630,275) 7,396,054 2,206,092 (886,240) 645,952
NET ASSETS:
Beginning of period ........................ 65,387,131 77,017,406 33,046,938 30,840,846 5,056,756 4,410,804
End of period .............................. $ 48,852,755 $ 65,387,131 $ 40,442,992 $ 33,046,938 $ 4,170,516 $ 5,056,756
============ ============ ============ ============ =========== ===========
Accumulated undistributed (distributions in
excess of) net investment income included
in net assets at end of period ........... $ (190,648) $ (193,923) $ (18,988) $ (21,713) $ 0 $ (34)
------------ ------------ ------------ ------------ ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Shares sold ................................ 418,094 784,282 1,307,776 753,991 152,197 247,860
Shares issued on reinvestment
of dividends ............................. 654,549 241,486 108,970 191,490 8,399 22,410
Shares repurchased ......................... (1,364,657) (1,129,115) (1,066,386) (591,000) (231,515) (230,820)
------------ ------------ ------------ ------------ ----------- -----------
Net increase (decrease)
from capital transactions ................ (292,014) (103,347) 350,360 354,481 (70,919) 39,450
============ ============ ============ ============ =========== ===========
====================================================================================================================================
</TABLE>
See accompanying notes to financial statements
11
<PAGE> 14
FAIRPORT FUNDS
- --------------------------------------------------------------------------------
The tables below set forth financial data for a share of beneficial interest
outstanding throughout each period presented.
<TABLE>
<CAPTION>
FAIRPORT MIDWEST GROWTH FUND
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year Year Year Year Year
Ended 4/30/99 Ended Ended Ended Ended Ended
(Unaudited) 10/31/98 10/31/97 10/31/96 10/31/95 10/31/94
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,BEGINNING OF PERIOD .................. $ 16.45 $ 18.88 $ 15.50 $ 13.55 $ 12.27 $ 11.07
------- --------- --------- -------- ---------- ---------
Income from Investment Operations:
Net investment income (loss) ......................... (0.01) (0.03) (0.01) 0.02 0.04 0.02
Net realized and unrealized gain (loss) on investments (0.57) (1.30) 4.55 2.16 2.04 1.19
------- --------- --------- -------- ---------- ---------
Total from investment operations .................. (0.58) (1.33) 4.54 2.18 2.08 1.21
------- --------- --------- -------- ---------- ---------
LESS DISTRIBUTIONS:
From net investment income ........................... 0.00 0.00 (0.01) (0.03) (0.04) (0.01)
From realized capital gains .......................... (2.61) (1.10) (1.15) (0.20) (0.76) 0.00
------- --------- --------- -------- ---------- ---------
Total distributions ............................... (2.61) (1.10) (1.16) (0.23) (0.80) (0.01)
------- --------- --------- -------- ---------- ---------
NET ASSET VALUE,END OF PERIOD ........................ $ 13.26 $ 16.45 $ 18.88 $ 15.50 $ 13.55 $ 12.27
======= ========= ========= ======== ========== =========
TOTAL RETURN ......................................... (5.54%)(**) (7.73%) 31.00% 16.28% 18.17% 10.89%
RATIOS/SUPPLEMENTAL DATA:
Net assets,end of period (000) ....................... $48,853 $ 65,387 $ 77,017 $ 57,198 $ 49,408 $ 29,688
Ratio of expenses to average net assets
before reimbursement of expenses by Adviser ....... 1.53%(*) 1.43% 1.58% 1.69% 1.57% 1.54%
after reimbursement of expenses by Adviser ........ 1.38%(*) 1.38% 1.38% 1.38% 1.41% 1.45%
Ratio of net investment income to average net assets
before reimbursement of expenses by Adviser ....... (0.14%)(*) (0.18%) (0.25%) (0.16%) 0.14% 0.08%
after reimbursement of expenses by Adviser ........ 0.01%(*) (0.13%) (0.05%) 0.15% 0.29% 0.17%
Portfolio turnover ................................... 73.29%(**) 52.23% 41.16% 58.01% 46.51% 77.57%
====================================================================================================================================
</TABLE>
(*) Annualized
(**) Not annualized
See accompanying notes to financial statements.
12
<PAGE> 15
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FAIRPORT GROWTHAND INCOME FUND
- ------------------------------------------------------------------------------------------------------------------------
Six Months Year Year Year Year Year
Ended 4/30/99 Ended Ended Ended Ended Ended
(Unaudited) 10/31/98 10/31/97 10/31/96 10/31/95 10/31/94
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,BEGINNING OF PERIOD .................. $ 15.89 $ 17.87 $ 14.22 $ 12.29 $ 10.68 $ 10.36
-------- --------- -------- -------- --------- --------
Income from Investment Operations:
Net investment income (loss) ......................... 0.01 0.01 0.05 0.13 0.15 0.14
Net realized and unrealized gain (loss) on investments 1.68 (0.15) 4.83 2.04 1.68 0.35
-------- --------- -------- -------- --------- --------
Total from investment operations .................. 1.69 (0.14) 4.88 2.17 1.83 0.49
-------- --------- -------- -------- --------- --------
LESS DISTRIBUTIONS:
From net investment income ........................... (0.01) 0.00 (0.09) (0.14) (0.12) (0.14)
From realized capital gains .......................... (0.93) (1.84) (1.14) (0.10) (0.10) (0.03)
-------- --------- -------- -------- --------- --------
Total distributions ............................... (0.94) (1.84) (1.23) (0.24) (0.22) (0.17)
-------- --------- -------- -------- --------- --------
NET ASSET VALUE,END OF PERIOD ........................ $ 16.64 $ 15.89 $ 17.87 $ 14.22 $ 12.29 $ 10.68
======== ========= ======== ======== ========= ========
TOTAL RETURN ......................................... (10.63%)** (1.20%) 36.61% 17.77% 17.36% 4.72%
Ratios/Supplemental Data:
Net assets,end of period (000) ....................... $ 40,443 $ 33,047 $ 30,841 $ 23,071 $ 23,082 $ 18,177
Ratio of expenses to average net assets
before reimbursement of expenses by Adviser ....... 1.47%(*) 1.53% 1.76% 1.83% 1.79% 1.72%
after reimbursement of expenses by Adviser ........ 1.45%(*) 1.49% 1.50% 1.50% 1.50% 1.50%
Ratio of net investment income to average net assets
before reimbursement of expenses by Adviser ....... 0.10%(*) (0.02%) 0.03% 0.58% 0.98% 1.20%
after reimbursement of expenses by Adviser ........ 0.12%(*) 0.02% 0.29% 0.91% 1.26% 1.42%
Portfolio turnover ................................... 58.99%(**) 40.43% 42.45% 34.02% 13.36% 35.16%
========================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
FAIRPORT GOVERNMENT SECURITIES FUND
- ------------------------------------------------------------------------------------------------------------------------
Six Months Year Year Year Year Year
Ended 4/30/99 Ended Ended Ended Ended Ended
(Unaudited) 10/31/98 10/31/97 10/31/96 10/31/95 10/31/94
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,BEGINNING OF PERIOD .................. $ 10.43 $ 9.90 $ 9.75 $ 9.84 $ 9.03 $ 10.20
-------- ------- -------- -------- -------- --------
Income from Investment Operations:
Net investment income (loss) ......................... 0.24 0.49 0.49 0.49 0.49 0.43
Net realized and unrealized gain (loss) on investments (0.36) 0.53 0.15 (0.05) 0.81 (1.17)
-------- ------- -------- -------- -------- --------
Total from investment operations .................. (0.12) 1.02 0.64 0.44 1.30 (0.74)
-------- ------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
From net investment income ........................... (0.24) (0.49) (0.49) (0.53) (0.49) (0.42)
From realized capital gains .......................... 0.00 0.00 0.00 0.00 0.00 (0.01)
-------- ------- -------- -------- -------- --------
Total distributions ............................... (0.24) (0.49) (0.49) (0.53) (0.49) (0.43)
-------- ------- -------- -------- -------- --------
NET ASSET VALUE,END OF PERIOD ........................ $ 10.07 $ 10.43 $ 9.90 $ 9.75 $ 9.84 $ 9.03
======== ======== ======== ======== ======== ========
TOTAL RETURN ......................................... (1.19%)** 10.61% 6.76% 4.58% 14.76% (7.24%)
Ratios/Supplemental Data:
Net assets,end of period (000) ....................... $ 4,171 $ 5,057 $ 4,411 $ 5,752 $ 8,647 $ 7,614
Ratio of expenses to average net assets
before reimbursement of expenses by Adviser ....... 2.14%* 2.19% 2.70% 2.05% 2.16% 1.80%
after reimbursement of expenses by Adviser ........ 0.90%* 0.90% 0.90% 0.90% 0.90% 0.90%
Ratio of net investment income to average net assets
before reimbursement of expenses by Adviser ....... 3.43%* 3.60% 3.23% 3.78% 3.89% 3.88%
after reimbursement of expenses by Adviser ........ 4.67%* 4.89% 5.03% 4.93% 5.16% 4.78%
Portfolio turnover ................................... 0.00%** 89.89% 21.01% 21.23% 1.28% 24.14%
========================================================================================================================
</TABLE>
13
<PAGE> 16
FAIRPORT FUNDS
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
NOTE (A) SIGNIFICANT ACCOUNTING POLICIES:
Fairport Funds (the "Trust"), formerly known as Roulston Family of Funds, is an
open-end management investment company and is organized under Ohio law as a
business trust under a Declaration of Trust dated September 16, 1994. On March
1, 1996, the Trust changed its name from The Roulston Family of Funds to
Fairport Funds. The Trust currently consists of three Funds (the "Funds"):
Fairport Midwest Growth Fund (the "Midwest Growth Fund"), Fairport Growth and
Income Fund (the "Growth and Income Fund") and Fairport Government Securities
Fund (the "Government Fund"). The Trust is registered under the Investment
Company Act of 1940, as amended (the "Act"). On April 29, 1995, pursuant to an
Agreement and Plan of Reorganization and Liquidation, the Midwest Growth Fund,
the Growth and Income Fund and the Government Fund of the Trust acquired, in a
tax free reorganization, all of the assets of each of the Roulston Midwest
Growth Fund, the Roulston Growth and Income Fund and the Roulston Government
Securities Fund (collectively, the "Acquired Funds") of the Advisors' Inner
Circle Fund, a Massachusetts business trust, respectively, in exchange for the
assumption of such Acquired Fund's liabilities and a number of full and
fractional shares of the corresponding Fund of the Trust having an aggregate net
asset value equal to such Acquired Fund's net assets (the "Reorganization"). The
Reorganization was approved by the shareholders of the Acquired Funds on March
24, 1995. For accounting purposes, the Reorganization was accounted for in a
manner similar to a pooling of interest and the financial highlights have been
presented since the Acquired Funds' inception, July 1, 1993.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
Effective October 27, 1998, the Trust selected the accounting firm of McCurdy &
Associates CPA's, Inc. to serve as the Funds' independent certified public
accountants for the fiscal year ended October 31, 1998 to fill a vacancy
resulting from Ernst & Young's resignation on October 9, 1998. Ernst & Young LLP
had served as the Funds' independent certified public accountants for the Funds'
fiscal year ended October 31, 1995, October 31, 1996, and October 31, 1997.
Ernst & Young's report on the financial statements of the Funds for the fiscal
year ended October 31, 1997 did not contain an adverse opinion or disclaimer of
opinion or was not qualified or modified as to uncertainty, audit scope or
accounting principles. There were no disagreements with Ernst & Young LLP on any
matter of accounting principles or practices, financial statement disclosure, or
auditing scope of procedure during the fiscal year ended October 31, 1997 or for
the interim period from November 1, 1997 through the date of their resignation.
The Trust represents that it had not consulted with McCurdy & Associates CPA's,
Inc. at any time prior to their engagement with respect to the application of
accounting principles to a specified transaction, either completed or proposed;
or the type of audit opinion that might be rendered on the Funds' financial
statements.
The following is a summary of significant accounting policies consistently
followed by the Trust.
(1) SECURITY VALUATION: The portfolio securities of each Fund will be valued at
market value. Each Fund uses one or more pricing services to provide market
quotations for equity, fixed income and variable income securities. If market
quotations are not available, securities will be valued by a method which the
Board of Trustees believes accurately reflects fair value. Equity securities
which are listed or admitted to trading on a national securities exchange or
other
14
<PAGE> 17
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
market trading system which reports actual transaction prices on a
contemporaneous basis will be valued at the last sales price on the exchange or
other market system on which the security is principally traded. For fixed and
variable income securities, the pricing service may use a matrix system of
valuation which considers factors such as securities prices, yield features,
call features, ratings and developments related to a specific security. The
Trustees may deviate from the valuation provided by the pricing service
whenever, in their judgment, such valuation is not indicative of the fair value
of the security. Short-term investments with a maturity of 60 days or less are
valued at amortized cost, which approximates market value.
(2) REPURCHASE AGREEMENTS: All Funds may enter into repurchase agreements with
financial institutions deemed to be creditworthy by Roulston & Company, Inc.
("Roulston"), the Funds' investment adviser, under guidelines approved by the
Trust's Board of Trustees, subject to the seller's agreement to repurchase and
the Funds' agreement to resell such securities at a mutually agreed-upon date
and price. Securities purchased subject to repurchase agreements are deposited
with the Funds' custodian and, pursuant to the terms of the repurchase
agreement, must have an aggregate market value greater than or equal to the
repurchase price plus accrued interest at all times. If the seller were to
default on its repurchase obligation or become insolvent, the Fund would suffer
a loss to the extent that the proceeds from a sale of the underlying portfolio
securities were less than the repurchase price under the agreement, or to the
extent that the disposition of such securities by the Fund was delayed pending
court action.
(3) FEDERAL INCOME TAXES: The Funds intend to be treated as "regulated
investment companies" under Sub-chapter M of the Internal Revenue Code and to
distribute substantially all of their net taxable income. Accordingly, no
provisions for Federal income taxes have been made in the accompanying financial
statements.
(4) INVESTMENT INCOME AND SECURITIES TRANSACTIONS: Dividend income is recorded
on the ex-dividend date. Interest income is accrued daily. Security transactions
are accounted for on the date securities are purchased or sold. Security gains
and losses are determined on the identified cost basis.
(5) DIVIDENDS AND DISTRIBUTIONS: Substantially all of the net investment income
(exclusive of capital gains) of the Midwest Growth Fund and the Growth and
Income Fund is distributed in the form of semi-annual dividends. Net investment
income (exclusive of capital gains) of the Government Fund is declared daily and
distributed in the form of monthly dividends. Substantially all of the capital
gains realized will be distributed annually.
(6) DEFERRED ORGANIZATIONAL COSTS: Organizational costs are being amortized on a
straight-line basis over five years commencing April 29, 1995.
NOTE (B) RELATED PARTY TRANSACTIONS:
The Trust and Roulston have entered into an Investment Advisory Agreement (the
"Agreement") dated as of January 20, 1995. Under the terms of the Agreement,
Roulston makes the investment decisions for the assets of the Funds and
continuously reviews, supervises, and administers the investment program of the
Funds. For its services as investment adviser, Roulston receives a fee, at an
annual rate of 0.75% of the average daily net assets of each of the Midwest
Growth Fund and the Growth and Income Fund up to $100 million of such assets,
and 0.50% of each such Fund's assets of $100 million or more. With respect to
the Government Fund, Roulston receives a fee at an annual rate of 0.25% of the
average daily net assets up to $100 million of such assets, and 0.125% of such
assets of $100 million or more. Such fees will be calculated daily and paid
monthly.
Pursuant to Rule 12b-1 under the Act, the Trust has adopted a Distribution and
Shareholder Service Plan dated January 20, 1995, as amended as of March 1, 1996
15
<PAGE> 18
FAIRPORT FUNDS NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
April 30, 1999 (Unaudited)
(the "Plan"), under which each Fund is authorized to pay or reimburse Roulston
Research Corp. (the "Distributor"), ultimately a wholly-owned subsidiary of
Roulston, a periodic amount calculated at an annual rate not to exceed 0.25% of
the average daily net asset value of such Fund. Such an amount may be used by
the Distributor to pay broker-dealers, banks and other institutions (a
"Participating Organization") for distribution and/or shareholder service
assistance pursuant to an agreement between the Distributor and the
Participating Organization or for distribution assistance and/or shareholder
service provided by the Distributor. Under the Plan, a Participating
Organization may include the Distributor's affiliates.
Roulston has agreed with the Trust to waive its investment advisory fee and to
reimburse certain other expenses of the Funds from the effective date of the
Reorganization (April 29, 1995) and such waivers and reimbursements shall
continue until further written notice to the extent necessary to cause total
operating expenses as a percentage of net assets of the Midwest Growth Fund, the
Growth and Income Fund and the Government Fund not to exceed 1.38%, 1.50% and
0.90%, respectively.
Information regarding these transactions is as follows for the six months ended
April 30, 1999:
<TABLE>
<CAPTION>
Midwest Growth
Growth and Income Government
Fund Fund Fund
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT ADVISORY FEES:
Fees before fee waiver .. $ 219,862 $ 160,286 $ 6,044
Fees waived ............. (43,117) (3,550) (6,044)
RULE 12b-1 FEES:
Fees .................... 73,287 53,429 6,044
Other expenses
reimbursed ........... 0 0 (23,965)
--------- --------- ---------
Net fees and expenses ... $ 250,032 $ 210,165 $ (17,921)
========= ========= =========
- --------------------------------------------------------------------------------
</TABLE>
Certain officers and trustees of the Trust are also officers, directors and/or
employees of Roulston and the Distributor. The officers and such interested
trustees serve without direct compensation from the Trust.
NOTE (C) INVESTMENT TRANSACTIONS:
Purchases and sales of investment securities (excluding short-term securities)
for the six months ended April 30, 1999 were:
<TABLE>
<CAPTION>
Proceeds
Purchases from Sales
(000) (000)
- --------------------------------------------------------------------------------
<S> <C> <C>
Midwest Growth Fund ........ $42,284 $47,374
Growth and Income Fund ..... 29,503 23,779
Government Fund ............ 0 3,376
- --------------------------------------------------------------------------------
</TABLE>
NOTE (D) UNREALIZED APPRECIATION AND DEPRECIATION:
At April 30, 1999, the gross unrealized appreciation and depreciation of
securities for book and Federal income tax purposes consisted of the following:
<TABLE>
<CAPTION>
Gross Gross Net
Unrealized Unrealized Unrealized
Appreciation (Depreciation) App/(Dep)
(000) (000) (000)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Midwest Growth Fund ..... $ 8,836 ($2,697) $ 6,139
Growth and Income Fund .. 8,911 (1,079) 7,832
Government Fund ......... 5 0 5
- --------------------------------------------------------------------------------
</TABLE>
16
<PAGE> 19
[FAIRPORT FUNDS LOGO]
4000 Chester Avenue
Cleveland, Ohio 44103
1-800-332-6459
Trustees:
Thomas V. Chema
David B. Gale
Scott D. Roulston
Officers:
Scott D. Roulston, President
Kevin M. Crotty, Treasurer
Charles A. Kiraly, Secretary
Adviser:
Roulston & Company, Inc.
4000 Chester Avenue
Cleveland, Ohio 44103
Distributor:
Roulston Research Corp.
4000 Chester Avenue
Cleveland, Ohio 44103
Administrator & Transfer Agent:
First Data Investor Services Group, Inc.
3200 Horizon Drive
King of Prussia, Pennsylvania 19406
Legal Counsel:
Baker & Hostetler LLP
65 E. State Street
Columbus, Ohio 43215
Independent Public Accountants:
McCurdy & Associates CPA's, Inc.
27955 Clemens Road
Westlake, Ohio 44145
Fairport Funds take their name from the historic Fairport Harbor Lighthouse,
located on Lake Erie at the Grand River, just east of the Funds' headquarters in
Cleveland, Ohio. Originally built in 1825, the Fairport Harbor Lighthouse guided
ships safely in and out of the harbor for 100 years. In its early years the
lighthouse was considered the gateway to the Western Reserve and the vast
frontiers of the Northwest Territories and beyond. Later the lighthouse served
as a beacon and supply stop for pioneers and travelers on their way to western
Great Lakes ports and beyond. The original brick structure was rebuilt in 1871
of sandstone blocks, as it remains today.
This report is submitted for the general information of the shareholders of the
Funds. It is not authorized for distribution to prospective investors in a Fund
unless proceeded or accompanied by an effective Prospectus which includes
details regarding the Fund's objectives, policies, expenses and other
information.
For information, call 1-800-332-6459
or visit us online at www.fairport.com
