-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BYmX2wpjALAzTOBvBfKXV/VjRk6rxJGTf/5rXdtdhRfkUxO1hBqj2V/V8O8FFHVh ZDxbR1jy2femA0elgAGTWg== /in/edgar/work/20000815/0000950147-00-001261/0000950147-00-001261.txt : 20000922 0000950147-00-001261.hdr.sgml : 20000921 ACCESSION NUMBER: 0000950147-00-001261 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000531 FILED AS OF DATE: 20000815 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ADVISORS SERIES TRUST CENTRAL INDEX KEY: 0001027596 STANDARD INDUSTRIAL CLASSIFICATION: [ ] STATE OF INCORPORATION: DE FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-07959 FILM NUMBER: 702442 BUSINESS ADDRESS: STREET 1: 2020 E FINANCIAL WAY SUITE 100 CITY: GLENDORA STATE: CA ZIP: 91741 BUSINESS PHONE: 8188521033 MAIL ADDRESS: STREET 1: 2020 E FINANCIAL WAY STREET 2: SUITE 100 CITY: GLENDORA STATE: CA ZIP: 91741 N-30D 1 0001.txt SEMI-ANNUAL REPORT DATE 05/31/00 SEMI-ANNUAL REPORT MAY 31, 2000 July 27, 2000 Dear Shareholders: In our Annual Report, discussion of the equity environment concluded that recent market volatility was likely to remain for several months. Our reasoning centered upon the continued positive response to an improving economy by cyclically sensitive businesses at the same time as the prior equity leadership was entering a period of consolidation. The net result of these intra-market dynamics would be a trading range with a modest downward bias for the Dow Jones Industrial Average and the S&P 500 Index. In order to have funds available to take advantage of the investment opportunities which would arise in this rotational environment, the Fund maintained 20% of its assets in cash. By early March, the S&P 500 had declined by approximately 10% while the NASDAQ was in the early stages of a 40% decline from its all-time high, reached only days earlier. We took advantage of significant disparities in the relative valuations among various high growth sectors of the NASDAQ to consolidate the Fund's exposure in the semiconductor, software and telecommunications sectors. At the same time, we increased the portfolio's investments in the biotech/genomic sector which continues to enjoy improving fundamentals and significant growth potential. The Fund's net asset value reflected the high degree of volatility exhibited by the market. For the twelve-month period ended May 31, 2000, the Fund appreciated 9.03% as compared with the S&P 500 increase of 10.48%. As of May 31, 2000, the Fund's six-month results declined 2.47% versus an increase in the S&P 500 of 2.88%. Over the past several weeks, the NASDAQ has risen by more than 35% and has regained more than 50% of the spring decline. Responding to our increased commitment to the biotech/genomic sector which has enjoyed an above average recovery, the Fund has significantly outperformed the S&P 500 Index since the end of May. The net asset value (NAV) of the Fund can be followed on financial web sites and quote machines under the symbol HEFGX. /s/ Anthony Orphanos Anthony Orphanos Fund Manager Footnotes: Performance figures of the Fund and indexes referenced represent past performance and are not indicative of future performance of the Fund or the indexes. Share value will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original investment. Indexes do not incur expenses and are not available for investment. The S&P Index is an unmanaged capitalization-weighted index of 500 stocks designed to represent the broad domestic economy. The Fund's annual total return for the year ended June 30, 2000 was 20.38% The Fund's average annual total return since inception (December 29, 1998) to June 30, 2000 was 23.42% The Fund is distributed by First Fund Distributors, Inc., Phoenix, AZ. Member NASD. HOWARD EQUITY FUND SCHEDULE OF INVESTMENTS AT MAY 31, 2000 (UNAUDITED) - -------------------------------------------------------------------------------- Shares COMMON STOCKS: 82.24% Market Value - -------------------------------------------------------------------------------- AEROSPACE/DEFENSE-EQUIPMENT: 3.03% 8,500 United Technologies Corp............................ $ 513,718 ----------- AUCTION HOUSE/ART DEALER: 0.77% 8,000 Sothebys Holdings, Inc.-A........................... 130,500 ----------- AUTO- CARS/LIGHT TRUCKS: 2.21% 5,300 General Motors Corp................................. 374,312 ----------- AUTOMOTIVE - MEDIUM & HEAVY DUTY TRUCKS: 2.46% 13,000 Navistar International Corp......................... 417,625 ----------- CELLULAR TELECOM: 1.09% 2,000 Nextel Communications, Inc.-A....................... 185,250 ----------- COMPUTER SOFTWARE: 1.43% 30,000 Cambridge Technology Partners, Inc.................. 241,875 ----------- COMPUTERS-HARDWARE: 1.42% 2,000 Hewlett-Packard Corp................................ 240,250 ----------- DIVERSIFIED MANUFACTURING OPERATIONS: 1.26% 2,500 Minnesota Mining & Manufacturing.................... 214,375 ----------- DIVERSIFIED UNIT INVESTMENT TRUST: 12.73% 26,000 Nasdaq-100 Shares................................... 2,158,406 ----------- ELECTRONIC COMPONENTS-SEMICONDUCTOR: 8.35% 5,800 Intel Corp.......................................... 722,825 9,600 Texas Instruments, Inc.............................. 693,600 ----------- 1,416,425 ----------- 2 HOWARD EQUITY FUND SCHEDULE OF INVESTMENTS AT MAY 31, 2000 (UNAUDITED), CONTINUED - -------------------------------------------------------------------------------- Shares Market Value - -------------------------------------------------------------------------------- INTERNET CONTENT: 3.50% 8,000 Safeguard Scientifics, Inc.......................... $ 257,500 10,000 Security First Technologies Corp.................... 336,250 ----------- 593,750 ----------- INTERNET SOFTWARE: 1.77% 160,000 Pacific Century Cyberworks Limited.................. 300,800 ----------- MEDICAL - DRUGS: 4.12% 5,000 Merck & Co., Inc.................................... 373,125 15,000 Pharmocopeia, Inc................................... 326,250 ----------- 699,375 ----------- MEDICAL PRODUCTS: 5.08% 100,000 Nycomed Amersham PLC-ADR............................ 861,695 ----------- MEDICAL-BIOMEDICAL/GENOMICS: 18.92% 5,500 Affymetrix, Inc..................................... 653,125 2,000 Diversa Corp........................................ 44,000 20,000 Lexicon Genetics, Inc............................... 200,000 26,000 Lynx Therapeutics, Inc. *........................... 416,000 12,000 Millennium Pharmaceuticals.......................... 1,003,500 16,000 P.E. Corp.-Celera Genomics.......................... 890,000 ----------- 3,206,625 ----------- METAL - ALUMINUM: 2.41% 7,000 Alcoa, Inc.......................................... 409,063 ----------- NETWORK SOFTWARE: 5.60% 71,000 Netspeak Corp....................................... 701,125 30,000 Novell, Inc......................................... 249,375 ----------- 950,500 ----------- NETWORKING PRODUCTS: 2.35% 7,000 Cisco Systems, Inc.................................. 399,000 ----------- 3 HOWARD EQUITY FUND SCHEDULE OF INVESTMENTS AT MAY 31, 2000 (UNAUDITED), CONTINUED - -------------------------------------------------------------------------------- Shares Market Value - -------------------------------------------------------------------------------- SATELLITE TELECOM: 1.08% 14,000 P.T. Pasifik Satelit Nusantara-ADR.................. $ 183,750 ----------- TELEPHONE-LONG DISTANCE: 2.66% 13,000 AT&T................................................ 450,938 ----------- 634,200 Total Common Stocks (Cost $16,007,116 +): 82.24%.... 13,948,232 ----------- Principal Amount SHORT-TERM INVESTMENTS: 18.92% - -------------------------------------------------------------------------------- $3,208,768 Firstar Stellar Treasury Fund, 4.18% (Cost $3,208,768)................................... 3,208,768 ----------- Total Investments in Securities (Cost $19,215,884): 101.16%......................... 17,157,000 Liabilities in Excess of Other Assets: (1.16)%...... (197,338) ----------- Total Net Assets: 100.00%........................... $16,959,662 =========== * Non-income producing security. + At May 31, 2000, the cost of securities for Federal tax purposes was the same as the basis for financial reporting. Gross unrealized appreciation and depreciation of securities on a tax basis were as follows: Gross unrealized appreciation....................... $ 1,052,094 Gross unrealized depreciation....................... (3,110,978) ----------- Net unrealized depreciation.................. $(2,058,884) =========== See Notes to Financial Statements. 4 HOWARD EQUITY FUND STATEMENT OF ASSETS AND LIABILITIES AT MAY 31, 2000 (UNAUDITED) - -------------------------------------------------------------------------------- ASSETS Investments in securities, at value (identified cost 19,215,884) $17,157,000 Receivables Fund shares sold............................................. 133,459 Dividends and interest....................................... 19,942 Prepaid expenses............................................... 14,046 ----------- Total assets............................................... 17,324,447 ----------- LIABILITIES Payables Due to Investment Advisor.................................... 18,648 Fund shares repurchased...................................... 183,444 Portfolio securities purchased............................... 139,943 Administration fees.......................................... 2,548 Accrued expenses............................................... 20,202 ----------- Total liabilities.......................................... 364,785 ----------- NET ASSETS....................................................... $16,959,662 =========== Net asset value, offering and redemption price per share [$16,959,662 / 1,444,620 shares outstanding; unlimited number of shares (par value $0.01) authorized]................. $ 11.74 =========== COMPONENTS OF NET ASSETS Paid-in capital................................................ $18,869,125 Undistributed net investment loss.............................. (49,122) Accumulated net realized gain on investments................... 198,543 Net unrealized depreciation on investments..................... (2,058,884) ----------- Net assets................................................... $16,959,662 =========== See Notes to Financial Statements. 5 HOWARD EQUITY FUND STATEMENT OF OPERATIONS - FOR THE SIX MONTHS ENDED MAY 31, 2000 (UNAUDITED) - -------------------------------------------------------------------------------- INVESTMENT INCOME Income Dividends.................................................... $ 28,622 Interest..................................................... 87,964 ----------- Total income............................................... 116,586 ----------- Expenses Advisory fees (Note 3)....................................... 84,521 Distribution Expense (Note 3)................................ 34,774 Custody fees................................................. 4,011 Fund accounting fees......................................... 7,020 Administration fee .......................................... 15,041 Professional fees............................................ 10,029 Transfer agent fees.......................................... 7,020 Reports to shareholders...................................... 3,510 Registration fees............................................ 2,445 Other........................................................ 1,003 Trustees' fees............................................... 1,742 Insurance expense............................................ 611 ----------- Total expenses............................................. 171,727 Less: advisory fee waiver and absorption (Note 3).......... (6,019) ----------- Net expenses............................................... 165,708 ----------- Net investment loss...................................... (49,122) ----------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Net realized gain from security transactions................... 375,842 Net change in unrealized depreciation on investments........... (3,089,915) ----------- Net realized and unrealized loss on investments.............. (2,714,073) ----------- NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS..... $(2,763,195) =========== See Notes to Financial Statements. 6 HOWARD EQUITY FUND STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------ Six Months Dec. 29, 1998* Ended through May 31, 2000# Nov. 30, 1999 - ------------------------------------------------------------------------------------------ Increase (DECREASE) in net assets from OPERATIONS Net investment (loss) / income........................... $ (49,122) $ 3,092 Net realized gain / (loss) on security transactions ..... 375,842 (177,758) Net change in unrealized (depreciation) / appreciation on investments......................................... (3,089,915) 1,031,031 ----------- ----------- NET (DECREASE) / INCREASE IN NET ASSETS RESULTING FROM OPERATIONS .................................... (2,763,195) 856,365 ----------- ----------- DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS From net investment income............................... (2,878) -- ----------- ----------- CAPITAL SHARE TRANSACTIONS Net increase in net assets derived from net change in outstanding shares (a)............................. 9,733,672 9,135,698 ----------- ----------- TOTAL INCREASE IN NET ASSETS ............................ 6,967,599 9,992,063 NET ASSETS Beginning of period........................................ 9,992,063 -- ----------- ----------- END OF PERIOD ............................................. $16,959,662 $ 9,992,063 =========== ===========
(a) A summary of capital shares transactions is as follows:
Six Months December 29, 1998* Ended through May 31, 2000# November 30, 1999 ---------------------------- ---------------------------- Shares Paid in Capital Shares Paid in Capital ----------- ----------- ----------- ----------- Shares sold ................................ 710,500 $11,097,796 842,974 $ 9,277,834 Shares issued on reinvestments of distributions.......................... 205 2,808 -- -- Shares redeemed............................. (95,815) (1,366,932) (13,245) (142,136) ----------- ----------- ----------- ----------- Net increase................................ 614,890 $ 9,733,672 829,729 $ 9,135,698 =========== =========== =========== ===========
* Commencement of operations. # Unaudited. See Notes to Financial Statements. 7 HOWARD EQUITY FUND FINANCIAL HIGHLIGHTS FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ------------------------------------------------------------------------------------------- Six Months Dec. 29, 1998* Ended through May 31, 2000# Nov. 30, 1999 - ------------------------------------------------------------------------------------------- Net asset value, beginning of period...................... $ 12.04 $ 10.00 ------- ------- Income from investment operations: Net investment income................................... (0.03) 0.00 Net realized and unrealized (loss)/gain on investments.. (0.27) 2.04 ------- ------- Total from investment operations.......................... (0.30) 2.04 ------- ------- Less distributions: From net investment income.............................. 0.00** -- ------- ------- Total distributions....................................... 0.00 -- ------- ------- Net asset value, end of period............................ $11.74 $ 12.04 ======= ======= TOTAL RETURN ............................................. (2.47%)++ 20.40%++ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands)..................... $16,960 $ 9,992 Ratio of expenses to average net assets: Before expense reimbursement............................ 2.02%+ 4.39%+ After expense reimbursement............................. 1.95%+ 1.95%+ Ratio of net investment loss to average net assets After expense reimbursement............................. (0.58%)+ 0.07%+ Portfolio turnover rate................................... 108.07% 211.31%
* Commencement of operations. ** Amount distributed represents less than one-half of one cent per share. # Unaudited. + Annualized. ++ Not Annualized. See Notes to Financial Statements. 8 HOWARD EQUITY FUND NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- NOTE 1 - ORGANIZATION The Howard Equity Fund (the "Fund") is a series of shares of beneficial interest of Advisors Series Trust (the "Trust"), which is registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The Fund began operations on December 29, 1998. The investment objective of the Fund is to seek growth of capital. The Fund attempts to achieve its objective by investing primarily in equity securities of large to mid capitalization companies. NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies consistently followed by the Fund. These policies are in conformity with generally accepted accounting principles. A. SECURITY VALUATION: The Fund's investments are carried at fair value. Securities that are primarily traded on a national securities exchange shall be valued at the last sale price on the exchange on which they are primarily traded on the day of valuation or, if there has been no sale on such day, at the mean between the bid and asked prices. Securities primarily traded in the NASDAQ National Market System for which market quotations are readily available shall be valued at the last sale price on the day of valuation, or if there has been no sale on such day, at the mean between the bid and asked prices. Over-the-counter ("OTC") securities which are not traded in the NASDAQ National Market System shall be valued at the most recent trade price. Securities for which market quotations are not readily available, if any, are valued following procedures approved by the Board of Trustees. Short-term investments are valued at amortized cost, which approximates market value. B. FEDERAL INCOME TAXES: It is the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required. C. SECURITY TRANSACTIONS, DIVIDENDS AND DISTRIBUTIONS: Security transactions are accounted for on the trade date. Dividend income and distributions to shareholders, which are determined in accordance with income tax regulations, are recorded on the ex-dividend date. Distributions which exceed net realized gains for financial reporting purposes but not for tax purposes are reported as distributions in excess of net realized gains and are primarily due to differing treatments for wash sales and realized losses subsequent to October 31 on sale of securities. Realized gains and losses on securities sold are determined on the basis of identified cost. Discounts and premiums on securities purchased are amortized over the life of the respective securities. D. 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 at the date of the financial statements and the reported amounts of increases and decreases in net assets during the reporting period. Actual results could differ from those estimates. 9 HOWARD EQUITY FUND NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- NOTE 3 - INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES For the six months ended May 31, 2000, Howard Capital Management (the "Advisor") provided the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnished all investment advice, office space, facilities, and provides most of the personnel needed by the Fund. As compensation for its services, the Advisor is entitled to a monthly fee at the annual rate of 1.00% based upon the average daily net assets of the Fund. For the year ended May 31, 2000, the Fund incurred $84,521 in Advisory Fees. The Fund is responsible for its own operating expenses. The Advisor has agreed to reduce fees payable to it by the Fund and to pay Fund operating expenses to the extent necessary to limit the Fund's aggregate annual operating expenses to 1.95% of average net assets (the "expense cap"). Any such reductions made by the Advisor in its fees or payment of expenses which are the Fund's obligation are subject to reimbursement by the Fund to the Advisor, if so requested by the Advisor, in subsequent fiscal years if the aggregate amount actually paid by the Fund toward the operating expenses for such fiscal year (taking into account the reimbursement) does not exceed the applicable limitation on Fund expenses. The Advisor is permitted to be reimbursed only for fee reductions and expense payments made in the previous three fiscal years, but is permitted to look back five years and four years, respectively, during the initial six years and seventh year of the Fund's operations. Any such reimbursement is also contingent upon Board of Trustees review and approval at the time the reimbursed is made. Such reimbursement may not be paid prior to the Fund's payment of current ordinary operating expenses. For the six months ended May 31, 2000, the Advisor reduced its fees and absorbed Fund expenses in the amount of $6,019; no amounts were reimbursed to the Advisor. Investment Company Administration, L.L.C. (the "Administrator") acts as the Fund's Administrator under an Administration Agreement. The Administrator prepares various federal and state regulatory filings, reports and returns for the Fund; prepares reports and materials to be supplied to the Trustees; monitors the activities of the Fund's custodian, transfer agent and accountants; coordinates the preparation and payment of the Fund's expenses and reviews the Fund's expense accruals. For its services, the Administrator receives a monthly fee at the following annual rate: Fund asset level Fee rate ---------------- -------- Less than $15 million $30,000 $15 million to less than $50 million 0.20% of average daily net assets $50 million to less than $100 million 0.15% of average daily net assets $100 million to less than $150 million 0.10% of average daily net assets More than $150 million 0.05% of average daily net assets The Fund has adopted a Distribution Plan pursuant to Rule 12b-1 (the "Plan"). The Plan permits the Fund to pay for distribution and related expenses at an annual rate of up to 0.25% of the Fund's average daily net assets annually. The expenses covered by the plan may include the cost of preparing and distributing prospectuses and other sales material, advertising and public relations expenses, payments to financial intermediaries and compensation of 10 HOWARD EQUITY FUND NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- personnel involved in selling shares of the Fund. Payments made pursuant to the Plan will represent compensation for distribution and service activities, not reimbursement for specific expenses incurred. Pursuant to a distribution coordination agreement adopted under the Plan, distribution fees are paid to the Advisor as "Distribution Coordinator." For the six months ended May 31, 2000, the Fund paid the Distribution Coordinator in the amount of $34,774. First Fund Distributors, Inc. (the "Distributor") acts as the Fund's principal underwriter in a continuous public offering of the Fund's shares. The Distributor is an affiliate of the Administrator. Certain officers of the Fund are also officers and/or directors of the Administrator and the Distributor. NOTE 4 - PURCHASES AND SALES OF SECURITIES For the six months ended May 31, 2000, the cost of purchases and the proceeds from sales of securities, excluding short-term securities, were $23,670,056 and $13,728,362, respectively. At November 30, 1999, the Fund had tax basis capital losses of approximately $177,000 which may be carried to offset future capital gains. Such losses expire November 30, 2007. 11 -----END PRIVACY-ENHANCED MESSAGE-----