(JEFFERSON LOGO)
JEFFERSON GROWTH & INCOME FUND
SEMI-ANNUAL REPORT
April 30, 1997
(JEFFERSON LOGO)
JEFFERSON GROWTH & INCOME FUND
June 1997
Dear Fellow Shareholders,
We are pleased to provide your semiannual report for the six month period ended
April 30, 1997. On behalf of myself and the Board of Trustees, I'd like to
welcome our new shareholders and thank our existing shareholders for their
continued support. Since our last semiannual report, Fund assets have grown
from $5.1 million to $6.4 million, an increase of over 25%.
We continue to make positive investment progress in a difficult market
environment. Since our last report to shareholders on October 31, 1996, through
the six month period ended April 30, 1997, the net asset value of Class A shares
has increased from $10.91 to $11.21 and the net asset value of Class B shares
has increased from $10.87 to $11.16. The Fund also paid two regular quarterly
dividends of $.0755 and $.0789 on Class A shares, and $.0567 and $.0602 on Class
B shares during the period.
The stock market remains very narrow in breadth. The 50 largest capitalization
stocks of the S&P 500 have provided most of the total return for the S&P for the
period. Broader market indices, such as the Value Line Composite and the
Russell 2000 have shown far lower returns for the same period. In the near
term, we would expect this performance gap to narrow as the valuation difference
between larger and smaller companies comes more into line with historic norms.
A slower domestic economy and pressure on corporate profits were our key
concerns in the last report to shareholders. This, plus avoiding negative
earnings surprises continues to be a primary concern when reviewing potential
investment candidates as the number of negative earnings surprises among public
companies continues to rise.
Company valuations are expensive by historic standards and market volatility
continues to be very high. Given these factors we continue to feel a defensive
portfolio posture is appropriate.
Sincerely,
/s/ Richard P. Imperiale
Richard P. Imperiale
Chairman
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1997 (UNAUDITED)
ASSETS:
Investments, at value (cost $6,298,411) $6,420,853
Receivable for securities sold 39,774
Income receivable 33,570
Receivable for shares issued 65,423
Organization costs, net of accumulated amortization 61,170
Other assets 7,437
----------
Total Assets 6,628,227
----------
LIABILITIES:
Payable to Distributor 25,057
Payable to Adviser 14,564
Payable for securities purchased 48,000
Payable for shares purchased 89,815
Accrued expenses 27,023
----------
Total Liabilities 204,459
----------
NET ASSETS $6,423,768
==========
NET ASSETS CONSIST OF:
Capital stock $6,019,242
Undistributed net investment income 18,858
Undistributed accumulated net realized gains on investments 263,226
Unrealized net appreciation on investments 122,442
----------
Total Net Assets $6,423,768
==========
CLASS A:
Net assets $5,696,812
Shares outstanding (unlimited number issued) 508,337
Net asset value and redemption price per share $11.21
==========
Maximum offering price per share $11.86
======
CLASS B:
Net assets $726,956
Shares outstanding (unlimited number issued) 65,142
Net asset value and offering price per share $11.16
==========
Redemption price per share, assuming maximum
contingent deferred sales charge $10.60
======
See notes to the financial statements.
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1997 (UNAUDITED)
INVESTMENT INCOME:
Dividend income $53,235
Interest income 66,044
---------
Total investment income 119,279
EXPENSES:
Investment advisory fees 17,779
Administration fees 11,287
Shareholder servicing and accounting costs 29,226
Distribution fees -- Class A 6,593
Distribution fees -- Class B 2,938
Custody fees 6,152
Federal and state registration fees 3,291
Professional fees 10,711
Reports to shareholders 2,575
Amortization of organization costs 1,484
Trustees' fees and expenses 2,708
Other 3,146
---------
Total expenses before waiver and reimbursement 97,890
Less: Waiver of expenses and reimbursement from Distributor (61,631)
---------
Net expenses 36,259
---------
NET INVESTMENT INCOME 83,020
---------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain on investments 263,249
Change in unrealized appreciation on investments (100,616)
---------
Net gain on investments 162,633
---------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $245,653
=========
See notes to the financial statements.
STATEMENT OF CHANGES IN NET ASSETS
(UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1997 OCTOBER 31, 1996
---------------- ----------------
OPERATIONS:
Net investment income $83,020 $89,249
Net realized gain on investments 263,249 25,978
Change in unrealized appreciation
on investments (100,616) 222,254
---------- ----------
Net increase in net assets resulting
from operations 245,653 337,481
---------- ----------
CAPITAL SHARE TRANSACTIONS:
Shares sold 1,637,403 3,594,458
Shares issued to holders in reinvestment
of dividends 105,217 78,069
Shares redeemed (558,214) (243,803)
---------- ----------
Net increase 1,184,406 3,428,724
---------- ----------
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income (73,777) (72,952)
From net realized gains (23,710) --
---------- ----------
Total distributions to Class A shareholders (97,487) (72,952)
---------- ----------
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income (6,149) (5,582)
From net realized gains (2,292) --
---------- ----------
Total distributions to Class B shareholders (8,441) (5,582)
---------- ----------
TOTAL INCREASE IN NET ASSETS 1,324,131 3,687,671
NET ASSETS:
Beginning of period 5,099,637 1,411,966
---------- ----------
End of period (including undistributed
net investment income of $18,858 and
$15,765, respectively) $6,423,768 $5,099,637
========== ==========
See notes to the financial statements.
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(UNAUDITED) SEPTEMBER 1, 1995 1<F1>
SIX MONTHS ENDED YEAR ENDED THROUGH
APRIL 30, 1997 OCTOBER 31, 1996 OCTOBER 31, 1995
------------------ ------------------ ------------------
CLASS A CLASS B CLASS A CLASS B CLASS A CLASS B
-------- ------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of period $10.91 $10.87 $10.04 $10.03 $10.00 $10.00
Income from investment operations:
Net investment income 0.15 0.12 0.27 0.21 0.04 0.03
Net realized and unrealized gains
on securities 0.35 0.34 0.87 0.83 -- --
-------- ------- -------- ------- -------- --------
Total from investment operations 0.50 0.46 1.14 1.04 0.04 0.03
Less distributions:
Dividends from net investment income (0.15) (0.12) (0.27) (0.20) -- --
Distributions from capital gains (0.05) (0.05) -- -- -- --
-------- ------- -------- ------- -------- --------
Total distributions (0.20) (0.17) (0.27) (0.20) -- --
-------- ------- -------- ------- -------- --------
Net asset value, end of period $11.21 $11.16 $10.91 $10.87 $10.04 $10.03
======= ======= ======== ======= ======= =======
TOTAL RETURN2<F2> 4.53%3<F3>4.11%3<F3> 11.50% 10.49% 0.40%3<F3>0.30%3<F3>
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of period $5,697 $727 $4,688 $412 $1,279 $133
Ratio of net expenses to average net assets 1.15%4<F4>1.90%4<F4> 1.15% 1.90% 1.15%4<F4>1.90%4<F4>
Ratio of net investment income to average
net assets 2.87%4<F4>2.12%4<F4> 3.03% 2.28% 3.09%4<F4>2.59%4<F4>
Portfolio turnover rate5<F5> 69.10% 69.10% 131.98% 131.98% -- --
Average commission rate paid6<F6> $0.0758 $0.0758 $0.0884 $0.0884 -- --
1<F1> Commencement of operations.
2<F2> The total return calculation does not reflect the 5.5% front end sales
charge for Class A or the 5% CDSC on Class B.
3<F3> Not annualized.
4<F4> Annualized.
5<F5> Calculated on the basis of the Fund as a whole without distinguishing
between the classes of shares issued. During the period ended October 31, 1995,
there were no sales of securities.
6<F6> Average commission rate disclosure not required for the period ended
October 31, 1995.
</TABLE>
See notes to the financial statements.
SCHEDULE OF INVESTMENTS
APRIL 30, 1997 (UNAUDITED)
NUMBER
OF SHARES VALUE
- ---------- -----
COMMON STOCKS -- 57.5%
Apparel -- 0.8%
8,000 Tultex Corporation +<F7> $52,000
----------
Auto and Truck -- 3.5%
3,000 Genuine Parts Company 97,125
1,800 PACCAR, Inc. 125,775
----------
222,900
----------
Chemicals -- 2.0%
15,000 NOVA Corporation 127,500
----------
Energy -- 0.7%
1,000 Buckeye Partners, L.P. 43,000
----------
Entertainment & Leisure -- 1.4%
6,000 Harveys Casinos Resorts 90,750
----------
Financial Services -- 3.3%
5,000 A.G. Edwards, Inc. 175,000
3,000 Willis Corroon Group PLC, ADR 35,625
----------
210,625
----------
Food, Beverage & Tobacco -- 7.9%
3,400 American Brands, Inc. 182,750
3,000 Dole Food Company 122,250
3,000 Morningstar Group, Inc.+<F7> 72,750
3,300 Quaker Oats Company 132,000
----------
509,750
----------
Insurance -- 1.1%
2,000 American Financial Group, Inc. 69,750
----------
Liquor -- 2.7%
4,000 Anheuser-Busch Companies, Inc. 171,500
----------
Lodging -- 2.2%
10,000 Choice Hotels International, Inc.+<F7> 140,000
----------
Manufacturing -- 6.2%
2,000 Crown Cork & Seal
Company, Inc. 109,500
3,000 Englehard Corporation 63,000
2,750 Hillenbrand Industries, Inc. 118,250
7,000 International Game Technology 111,125
----------
401,875
----------
Metals and Mining -- 0.9%
8,000 Free Street Consolidated
Gold Mines Limited - ADR 54,500
----------
Oil & Gas - International -- 2.1%
6,000 Occidental Petroleum Corporation 132,750
----------
Real Estate -- 10.7%
7,500 Berkshire Realty Company, Inc. 80,625
1,000 BRE Properties, Inc. - Class A 23,500
6,000 Burnham Pacific Properties, Inc. 75,000
4,000 Hospitality Properties Trust 123,500
3,500 Manufactured Home
Communities, Inc. 73,500
4,000 Merry Land & Investment
Company, Inc. 82,000
5,500 Newhall Land & Farming
Company 104,500
2,000 Prentiss Properties Trust 47,250
3,000 Public Storage, Inc. 80,625
----------
690,500
----------
Retail - General -- 5.7%
5,300 99 Cents Only Stores +<F7> 114,612
1,000 American Stores Company 45,500
2,000 J.C. Penney & Company, Inc. 95,500
4,000 Toys "R" Us, Inc. +<F7> 114,000
----------
369,612
----------
Technology -- 5.3%
3,500 Electronic Data Systems
Corporation 116,812
2,000 Pitney Bowes, Inc. 128,000
6,000 Scientific-Atlanta, Inc. 96,000
----------
340,812
----------
Utility - Water -- 1.0%
4,000 United Water Resources, Inc. 65,500
----------
TOTAL COMMON STOCKS
(COST $3,577,269) 3,693,324
----------
PREFERRED STOCKS -- 6.5%
Bank & Bank Holding Companies -- 1.9%
5,000 First Source Capital Trust II 125,000
----------
Real Estate -- 1.9%
4,800 Oasis Residential, Inc. -
Convertible Preferred 123,600
----------
Technology -- 2.7%
2,000 Microsoft Corporation -
Convertible Preferred 171,250
----------
TOTAL PREFERRED STOCK
(COST $414,392) 419,850
----------
PRINCIPAL
AMOUNT VALUE
--------- ------
CORPORATE BONDS AND NOTES -- 11.8%
Bank & Bank Holding Companies -- 2.5%
Norwest Corporation
$10,000 9.25%, 5/01/97 10,000
150,000 7.68%, 5/10/02 151,954
----------
161,954
----------
Consumer Durable -- 0.3%
20,000 BankAmerica Corporation
8.125%, 2/01/02 20,837
----------
Diversified -- 1.6%
100,000 Baxter International
7.50%, 5/01/97 100,000
----------
Finance Company -- 2.0%
15,000 Ford Capital B.V.
9.125%, 5/01/98 15,391
100,000 General Motors Acceptance
Corporation
7.50%, 11/04/97 100,775
10,000 Norwest Financial, Inc.
6.50%, 11/15/97 10,023
----------
126,189
----------
Food, Beverage & Tobacco -- 0.8%
50,000 Philip Morris Companies Inc.
8.625%, 3/01/99 51,588
----------
Telephone -- 1.5%
100,000 New England Telephone and Telegraph
5.05%, 10/01/98 98,190
----------
Utility - Electric -- 3.1%
150,000 Detroit Edison
6.40%, 10/01/98 149,763
25,000 Minnesota Power and Light
6.50%, 1/01/98 24,997
25,000 Ohio Power Company
6.75%, 3/01/98 24,990
----------
199,750
----------
TOTAL CORPORATE BONDS
AND NOTES (COST $759,699) 758,508
----------
U.S. GOVERNMENT AGENCY -- 6.8%
100,000 FNMA Medium Term Note
5.23%, 11/25/98 98,550
38,900 FNMA Pass-Thru
6.00%, 5/01/00 38,190
300,000 SLMA Floating Rate Note
5.60%, 8/04/97 300,049
----------
TOTAL U.S. GOVERNMENT AGENCY
(COST $434,669) 436,789
----------
SHORT-TERM INVESTMENTS -- 17.3%
COMMERCIAL PAPER
Financial Services -- 1.5%
100,000 Financial Federal Credit, 5.53% 98,708
----------
VARIABLE RATE DEMAND NOTES
Drugs -- 3.0%
195,394 Warner-Lambert Company, 5.23% 195,394
----------
Food -- 3.1%
197,299 Sara Lee Corporation, 5.22% 197,299
----------
Technology -- 9.2%
270,277 American Family Financial
Services, 5.26% 270,277
317,980 Johnson Controls, Inc., 5.28% 317,980
----------
588,257
----------
Utility - Electric -- 0.5%
32,724 Wisconsin Electric Power
Company, 5.30% 32,724
----------
TOTAL SHORT-TERM INVESTMENTS
(COST $1,112,382) 1,112,382
----------
TOTAL INVESTMENTS -- 99.9%
(COST $6,298,411) 6,420,853
----------
Other Assets less
Liabilities -- 0.1% 2,915
----------
TOTAL NET
ASSETS -- 100.0% $6,423,768
==========
+<F7>Non-income producing.
See notes to the financial statements.
NOTES TO THE FINANCIAL STATEMENTS
APRIL 30, 1997 (UNAUDITED)
1). ORGANIZATION
The Jefferson Growth & Income Fund (the "Fund") is a mutual fund created by The
Jefferson Fund Group Trust (the "Trust") which was organized as a business trust
under the laws of Delaware on January 20, 1995. The Fund is one of a series
issued by the Trust, which is an open-end management company registered under
the Investment Company Act of 1940, as amended.
Between the date of organization and the commencement of operations on September
1, 1995, the Fund had no operations other than incurring organizational
expenses. These costs aggregated $65,659, which were paid by Rodman & Renshaw,
Inc. and are being amortized over the period of benefit, but not to exceed sixty
months from the date the Fund commenced operations.
The Trust is authorized to issue an unlimited number of shares without par
value. The Trust has issued issued two classes of shares in the Fund: Class A
and Class B. The Class A shares are subject to a service organization fee of
0.25% pursuant to Rule 12b-1 and a front-end sales charge imposed at the time of
purchase in accordance with the Fund's prospectus. The maximum front-end sales
charge is 5.50% of the offering price or 5.82% of the net asset value. The
Class B shares are subject to a service organization fee of 0.25% and
distribution fees of 0.75% pursuant to Rule 12b-1. Certain of the Class B
shares are subject to a contingent deferred sales charge (CDSC), upon redemption
from the Fund within seven years from the time of the original purchase. Each
class of shares of the Fund has identical rights and privileges.
2). SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements. These policies are in
conformity with generally accepted accounting principles.
a). Investment Valuation -- Securities which are traded on a national or
recognized stock exchange are valued at the last sale price on the securities
exchange on which such securities are primarily traded. Exchange-traded
securities for which there were no transactions that day are valued at the most
recent bid prices. Securities traded on only over-the-counter markets are
valued on the basis of closing over-the-counter bid prices. Instruments with a
remaining maturity of 60 days or less are valued on an amortized cost basis.
Securities for which market quotations are not readily available, and securities
which are restricted as to resale are valued at fair value as determined by the
investment adviser under the supervision of the Board of Trustees. Portfolio
securities which are primarily traded on foreign securities exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, except when an occurrence subsequent to the time a value
was so established is likely to have changed such value.
b). Federal Income Taxes -- Provision for federal income taxes or excise taxes
has not been made since the Fund has elected to be taxed as a "regulated
investment company" and intends to distribute substantially all taxable income
to its shareholders and otherwise comply with the provisions of the Internal
Revenue Code applicable to regulated investment companies.
c). Income and Expenses -- The Fund is charged for those expenses that are
directly attributable to the portfolio, such as advisory, administration and
certain shareowner service fees. Net investment income other than class
specific expenses, and realized and unrealized gains and losses are allocated
daily to each class of shares based upon the relative net asset value of
outstanding shares at the beginning of the day (after adjusting for the current
capital share activity of the respective class).
d). Distributions to Shareowners -- Dividends from net investment income are
declared and paid on a calendar quarter basis. Distributions of net realized
capital gains, if any, will be declared at least annually.
e). Written Option Accounting -- When the Fund sells an option, an amount equal
to the premium received by the Fund is included in the Statement of Assets and
Liabilities as an asset and an equivalent liability. The amount of the
liability is subsequently marked-to-market to reflect the current value of the
option written. When an option expires on its stipulated expiration date or the
Fund enters into a closing purchase transaction, the Fund realizes a gain or
loss if the cost of the closing purchase transaction differs from the premium
received when the option was sold without regard to any unrealized gain or loss
on the underlying security, and the liability related to such option is
eliminated. When an option is exercised, the Fund realizes a gain or loss from
the sale of the underlying security, and the proceeds from such sale are
increased by the premium originally received.
f). Futures Contracts -- The Fund may utilize futures contracts to a limited
extent for hedging purposes. The primary risks associated with the use of
futures contracts include an imperfect correlation between the change in market
value of the securities held by the Fund and the prices of futures contracts and
the possibility of an illiquid market. Futures contracts are valued based upon
their quoted daily settlement prices. Changes in initial settlement value are
accounted for as unrealized appreciation (depreciation) until the contracts are
terminated at which time realized gains and losses are recognized.
g). Use of Estimates -- 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.
h). Other -- Investment and shareholder transactions are accounted for no later
than the first business day after trade date. The Fund determines the gain or
loss realized from the investment transactions by comparing the original 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.
3). CAPITAL SHARE TRANSACTIONS
Transactions in shares of the Fund were as follows:
CLASS A
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1997 OCTOBER 31, 1996
----------------- --------------------
AMOUNT SHARES AMOUNT SHARES
------- ------- -------- -------
Shares sold $1,338,524 120,011 $3,245,931 309,269
Shares issued
to holders in
reinvestment
of dividends 96,800 8,610 72,487 6,887
Shares
redeemed (558,190) (49,783) (148,321) (14,019)
---------- -------- ---------- --------
Net increase $877,134 78,838 $3,170,097 302,137
========== ======== ========== =======
CLASS B
-------------------------------------------------
SIX MONTHS ENDED PERIOD ENDED
APRIL 30, 1997 OCTOBER 31, 1996
------------------ ------------------
AMOUNT SHARES AMOUNT SHARES
-------- -------- --------- --------
Shares sold $298,879 26,533 $348,527 33,239
Shares issued
to holders in
reinvestment
of dividends 8,417 751 5,582 532
Shares
redeemed (24) (2) (95,482) (9,156)
--------- ------- --------- -------
Net increase $307,272 27,282 $258,627 24,615
========= ======= ========= =======
4.)INVESTMENT TRANSACTIONS
The aggregate purchases and sales of securities, excluding short-term
investments, by the Fund for the six months ended April 30, 1997, were as
follows:
PURCHASES SALES
--------- ------
U.S. Government -- $2,944
Other $3,598,033 $2,898,459
At April 30, 1997, gross unrealized appreciation and depreciation of investments
for federal income tax purposes was as follows:
Appreciation $276,162
(Depreciation) (153,715)
--------
Net unrealized appreciation
on investments $122,447
========
At April 30, 1997, the cost of investments for federal income tax purposes was
$6,298,411.
Transactions in options written during the six month period ended April 30, 1997
were as follows:
NUMBER
(100 SHARES
PER CONTRACT) PREMIUMS
------------- --------
Options outstanding
at Beginning of Year 78 $13,208
Options written during
the period 227 29,431
Options expired (30) (2,039)
Options exercised (115) (18,883)
Options closed (160) (21,717)
------ ---------
Options outstanding
at End of Year 0 $0
====== ========
5). INVESTMENT ADVISORY AND OTHER AGREEMENTS
Pursuant to its Advisory Agreement with the Fund, the Adviser is entitled to
receive a fee, calculated daily and payable monthly, at the annual rate of 0.60%
as applied to the Fund's daily net assets.
The Trust has entered into a distribution and servicing agreement with Rodman &
Renshaw, Inc. (the "Distributor"). The Trust has adopted a Class A Servicing
Fee Plan whereby the Fund pays the Distributor servicing fees of up to 0.25%
annually, calculated as a percentage of the Fund's average daily net assets
attributable to Class A shares. Pursuant to the Class B distribution and
servicing agreement, the Fund is authorized to pay the Distributor a
distribution fee in an amount not to exceed on an annual basis 0.75% of the
average daily net assets of the Class B shares of the Fund and a service fee in
an amount not to exceed on an annual basis 0.25% of the average daily net asset
value of the Class B shares of the Fund. The Distributor may bear various
promotional and sales related expenses, including the cost of printing and
mailing prospectuses to persons other than shareholders.
Under the distribution agreement, if the aggregate annual operating expenses
(excluding interest, taxes, brokerage commissions and other costs incurred in
connection with the purchase or sale of portfolio securities, and extraordinary
items) exceed 1.15% and 1.90% of average net assets for Class A and Class B
shares respectively, the Distributor will reimburse the Fund for the amount of
such excess. Accordingly, for the six months ended April 30, 1997, the
Distributor reimbursed the Fund $61,631. The Fund paid brokerage commissions of
$1,010 to the Distributor during the six months ended April 30, 1997.
The Distributor received front-end sales charges on Class A shares and
contingent deferred sales charges on Class B shares of $2,404 and $248,
respectively, for the six months ended April 30, 1997.
(JEFFERSON LOGO)
JEFFERSON GROWTH & INCOME FUND
INVESTMENT ADVISER
Uniplan, Inc.
839 North Jefferson Street
Suite 201
Milwaukee, WI 53202
(800) 261-9785
ADMINISTRATOR, TRANSFER AGENT,
DIVIDEND PAYING AGENT & CUSTODIAN
Firstar Trust Company
615 East Michigan Street
Milwaukee, WI 53202
DISTRIBUTOR
Rodman & Renshaw, Inc.
233 South Wacker Drive
Suite 4500
Chicago, IL 60606
LEGAL COUNSEL
Foley & Lardner
330 North Wabash Avenue
Suite 3300
Chicago, IL 60611
INDEPENDENT ACCOUNTANTS
Coopers & Lybrand L.L.P.
411 East Wisconsin
Milwaukee, WI 53202
