hft_hf-ncsrs.htm

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY CORNERSTONE

LARGE GROWTH FUND

Investor Class HFLGX

Institutional Class HILGX

hennessyfunds.com | 1-800-966-4354

(This Page Intentionally Left Blank.)

Contents

Letter to Shareholders	2
Performance Overview	4
Financial Statements
Schedule of Investments	6
Statement of Assets and Liabilities	10
Statement of Operations	11
Statements of Changes in Net Assets	13
Financial Highlights	14
Notes to the Financial Statements	18
Expense Example	25
Proxy Voting	27
Quarterly Filings on Form N-Q	27
Federal Tax Distribution Information	27
Householding	27
Board Approval of Investment Advisory Agreement	28

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

The financial markets have provided strong returns over the past six-months ended April 30, 2014, with the Dow Jones Industrial Average (DJIA) and S&P 500 both returning approximately 8% during the period. The current valuation metrics of the major indices are solid; for example, the DJIA currently has a price-to-earnings ratio of 15x and a price-to-sales ratio of 1.75x. The DJIA also has a dividend yield of 2.2%, which is nearly as high as that of a 10-Year U.S. Treasury, which is currently yielding 2.6%. Investing in high-yielding, high-quality DJIA stocks have the potential to not only provide an income stream but also for stock price appreciation as well. Fixed income investing has run its course, in my opinion, and many individuals are currently benefiting from the return to investing in equities that possess strong fundamentals.

U.S. corporations continue to drive shareholder value by making acquisitions, initiating and raising dividends, investing in internal infrastructure, and buying back stock. However, lately I have begun to see a shift in those business strategies. The easier-to-execute acquisitions seem to be a thing of the past, and firms now have to be even more creative to execute accretive deals. I also believe that while firms may continue to initiate dividends, fewer firms will raise their dividends and fewer firms will participate in stock buyback programs going forward. So what will these cash-rich companies do with their capital if they are not raising dividends or buying back stock? I believe we will see companies begin to initiate capital expenditure programs.

Due to the continuing uncertainty from a lack of clear policies on taxes, healthcare, and regulations, I have observed that corporations would rather wait for clarity from our government leaders and defer any significant changes to their current business models. Up until this point, there has been no real cost for firms to defer spending their capital as they wait for anticipated guidance on policies that directly affect their businesses. But, this economic handcuffing from all of this uncertainty has gone on long enough. I believe there will now be firms who want to improve their margins and will begin spending money to expand their sales, and may even begin to hire. Once a competitor begins to move in this way, then the cost to defer becomes real for companies. This movement to expansion may well be a catalyst to propel the financial markets. I do believe this will be a slow shift, but one that will keep the economy improving, and should, in my opinion, help to generate reasonable market returns over the next few years.

With almost $3 trillion in cash sitting on the sidelines, this strategic shift by companies to begin spending their idle capital should help the economic recovery in the U.S. But that is only one part of the equation. Washington politics still play a role in how strong that recovery will be. The national political landscape will change in the next few years, and the future generation of elected officials will be faced with what I believe are fictitious unemployment figures (6.3% reported, when over 20 million Americans are looking for more work or a better job), a sluggish economy, and global competition in business. The next regime needs to provide real clarity on the issues that face all Americans and American corporations: taxation, regulation, and how to pay for our new healthcare system. I also believe that our government needs to regard business as a noble profession and to implement common sense and logic in their policy making instead of politics as usual. As Confucius is quoted as saying, “Life is really simple, but we insist on making it complicated.”

HENNESSYFUNDS.COM

I am confident that even with all the hurdles facing corporate America, companies continue to provide good value for their shareholders, and I believe that means the financial markets are in good shape and should remain strong moving forward, I also believe that the next few months may be volatile. Fads come and go, and the current buzz on the Street is around investing in social media stocks. I believe that chasing hot products has contributed and will continue to contribute to the volatility of the markets this year. After over 35 years in the business, I still firmly believe the best way to position your portfolio is by investing in good companies over the long term, rather than trying to buy the next hot idea at exactly the right time. At Hennessy Funds, hunches and fads have no place in our investment process, and we understand that successful investing comes from time in the market, not timing the market.

We remain focused on investing based on proven fundamentals, and we are committed to managing money for the sole benefit of our shareholders. If you have any questions or want to speak with us directly, please don’t hesitate to call us at (800) 966-4354.

Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Dow Jones Industrial Average and S&P 500 are unmanaged indices commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

Price-to-sales ratio and price-to-earnings ratio are tools for calculating relative valuation. Price-to-sales ratio is calculated by dividing the market price by revenue per share. Price-to-earnings ratio is the market price per share divided by earnings per share.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

The opinions expressed in the following commentary reflect those of the Portfolio Managers as of the date written. Any such opinions are subject to change based on market or other conditions and are not guaranteed. These opinions may not be relied upon as investment advice. Investment decisions for the Fund are based on several factors, and may not be relied upon as an indication of trading intent on behalf of the Fund. Security positions can and do change.

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014

			Since
	Six	One	Five	Inception
	Months(1)	Year	Years	(3/20/09)
Hennessy Large Growth Fund –
Investor Class (HFLGX)	12.70%	28.53%	20.41%	23.31%
Hennessy Large Growth Fund –
Institutional Class (HILGX)	12.81%	28.82%	20.75%	23.65%
Russell 1000® Index	8.25%	20.81%	19.52%	22.23%
S&P 500 Index	8.36%	20.44%	19.14%	21.72%

Expense ratios: 1.19% (Investor Class); Gross 1.10%, Net 0.98%(2) (Institutional Class)

Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by visiting hennessyfunds.com.

The expense ratios presented are from the most recent prospectus.

(1)	Periods less than one year are not annualized.
(2)	With regard to Institutional Class shares, the Fund’s investment advisor has contractually agreed to waive a portion of its expenses indefinitely.

PERFORMANCE NARRATIVE

Portfolio Manager, Neil Hennessy, and Co-Portfolio Manager, Brian Peery

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Investor Class of the Hennessy Cornerstone Large Growth Fund returned 12.70%, significantly outperforming the Russell 1000® Index, the S&P 500 Index, and the Morningstar Large Blend Category Average, which returned 8.25%, 8.36%, and 7.41% for the same period, respectively.

We are very pleased with the overall performance of the Fund during the previous six months versus its benchmarks. The Fund’s relative outperformance was driven entirely by stock selection, as asset allocation had a very slight negative effect on the portfolio. The biggest contribution to the Fund’s outperformance versus its benchmarks was stock selection in the Industrial and Information Technology sectors, which accounted for over half of the outperformance relative to the Russell 1000® Index. The largest detractor to the Fund’s performance was its cash holdings, which are targeted at less than 5% of the Fund’s total net assets and which averaged approximately 3.5% for the six-month period.

HENNESSYFUNDS.COM

Additional Portfolio Manager commentary and related investment outlook:

During the last six months, we saw a continued trend of companies beating earnings expectations, but not quite meeting revenue targets. We believe this trend is abating and that we should see better earnings and revenue numbers in the coming year. While top line revenue growth was muted due to a slow growth environment and weather-related issues, companies are still doing well. Corporate profits continue to reach new highs due to deferred capital expenditure plans, combined with tempered cost cutting.

We feel, however, that we are in the midst of a change, and an important one for the future of the bull market. We are seeing positive signs in both revenue growth and the all-important corporate capital expenditures levels. Over the last six months, we have seen a slight disconnect between earnings and revenues, with earnings showing healthy gains, largely due to cost containment, while revenue growth lagged. With few cost cuts seemingly left to be made, companies appear to be starting to utilize their healthy balance sheets to focus on organic growth, and we expect that will drive corporate spending higher. In fact, we anticipate the U.S. economy should expand nicely over the next 12 to 18 months and that the markets should benefit from this flow of capital. While excess cash has largely been directed toward acquisitions, increasing dividends, and/or stock buybacks recently, we believe this shift in corporate spending has the potential to reward shareholders over the longer term. One of the key criteria we use in the stock selection process for the Fund is return on total capital, which is essentially a profitability ratio that measures a return on investment. What it really indicates is how successfully a company turns capital into profits. We believe companies are now shifting towards organic growth via capital expenditure plans and that they are very well positioned to do so. We are pleased that the companies selected for inclusion in the Fund’s portfolio through our stock selection methodology appear to be leading their respective industries in creating value for their shareholders.

We believe the attractiveness of equity prices coupled with an extremely low interest rate environment have many investors seeking high quality, dividend-paying growth companies (note that 46 out of the 50 stocks within the portfolio pay a dividend). In our view, investing in growth companies that pay a dividend can provide an exciting potential to generate current income, coupled with the potential price appreciation of the stock.

The Russell 1000® Index and the S&P 500 Index are unmanaged indices commonly used to measure the performance of U.S. stocks. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund may invest in medium-capitalization companies, which may have more limited liquidity and greater price volatility than large-capitalization companies. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

Each Morningstar category average represents a universe of funds with similar investment objectives. © Morningstar, Inc. All Rights Reserved. The information contained herein: 1) is proprietary to Morningstar; 2) may not be copied or distributed and 3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance does not guarantee future results.

HENNESSY FUNDS 1-800-966-4354

Schedule of Investments

HENNESSY CORNERSTONE LARGE GROWTH FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Delta Air Lines, Inc.	2.24%
	Halliburton Co.	2.23%
	SanDisk Corp.	2.19%
	Lorillard, Inc.	2.12%
	Kroger Co.	2.09%
	Caterpillar, Inc.	2.09%
	Hewlett-Packard Co.	2.07%
	Eli Lilly & Co.	2.05%
	Union Pacific Corp.	2.02%
	AutoZone, Inc.	2.01%

Note: For presentation purposes, the Fund has grouped some of the industry categories. For purposes of categorizing securities for compliance with Section 8(b)(1) of the Investment Company Act of 1940, the Fund uses more specific industry classifications.

HENNESSYFUNDS.COM

COMMON STOCKS – 94.41%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 17.48%
AutoZone, Inc. (a)		4,400	$	2,349,116		2.01	%
Bed Bath & Beyond, Inc. (a)		25,800		1,602,954		1.37	%
Coach, Inc.		36,900		1,647,585		1.41	%
DIRECTV (a)		30,100		2,335,760		2.00	%
Dollar General Corp. (a)		34,000		1,918,960		1.64	%
Ford Motor Co.		133,800		2,160,870		1.85	%
Lowes Companies, Inc.		42,400		1,946,584		1.67	%
Macy’s, Inc.		38,800		2,228,284		1.91	%
McDonald’s Corp.		21,500		2,179,670		1.86	%
The Gap, Inc.		52,500		2,063,250		1.76	%
				20,433,033		17.48	%

Consumer Staples – 19.03%
Altria Group, Inc.		55,000		2,206,050		1.89	%
General Mills, Inc.		42,100		2,232,142		1.91	%
Kimberly Clark Corp.		19,900		2,233,775		1.91	%
Kraft Foods Group, Inc.		38,800		2,206,168		1.89	%
Kroger Co.		53,100		2,444,724		2.09	%
Lorillard, Inc.		41,700		2,477,814		2.12	%
Pepsico, Inc.		25,200		2,164,428		1.85	%
Philip Morris International, Inc.		24,300		2,075,949		1.78	%
Sysco Corp.		57,600		2,098,368		1.79	%
Wal-Mart Stores, Inc.		26,400		2,104,344		1.80	%
				22,243,762		19.03	%

Energy – 13.37%
Chevron Corp.		16,700		2,096,184		1.79	%
ConocoPhillips		29,700		2,207,007		1.89	%
Exxon Mobil Corp.		20,900		2,140,369		1.83	%
Halliburton Co.		41,400		2,611,098		2.23	%
HollyFrontier Corp.		42,100		2,214,039		1.90	%
Marathon Oil Corp.		60,100		2,172,615		1.86	%
Marathon Petroleum Corp.		23,500		2,184,325		1.87	%
				15,625,637		13.37	%

Health Care – 5.69%
Baxter International, Inc.		29,975		2,181,880		1.87	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Health Care (Continued)
Eli Lilly & Co.		40,600	$	2,399,460		2.05	%
UnitedHealth Group, Inc.		27,600		2,071,104		1.77	%
				6,652,444		5.69	%

Industrials – 21.32%
Caterpillar, Inc.		23,100		2,434,740		2.09	%
CSX Corp.		73,000		2,060,060		1.76	%
Cummins, Inc.		14,900		2,247,665		1.92	%
Deere & Co.		22,900		2,137,486		1.83	%
Delta Air Lines, Inc.		71,000		2,614,930		2.24	%
Illinois Tool Works, Inc.		24,800		2,113,704		1.81	%
Lockheed Martin Corp.		14,100		2,314,374		1.98	%
Northrop Grumman Corp.		18,300		2,223,633		1.90	%
Raytheon Co.		23,400		2,234,232		1.91	%
Union Pacific Corp.		12,400		2,361,332		2.02	%
United Technologies Corp.		18,400		2,177,272		1.86	%
				24,919,428		21.32	%

Information Technology – 15.65%
Apple, Inc.		3,850		2,271,847		1.94	%
Hewlett-Packard Co.		73,200		2,419,992		2.07	%
Intel Corp.		80,500		2,148,545		1.84	%
International Business Machines Corp.		11,100		2,180,817		1.86	%
Microsoft Corp.		56,200		2,270,480		1.94	%
Oracle Corp.		55,200		2,256,576		1.93	%
SanDisk Corp.		30,100		2,557,597		2.19	%
Western Digital Corp.		24,900		2,194,437		1.88	%
				18,300,291		15.65	%

Materials – 1.87%
CF Industries Holdings, Inc.		8,900		2,182,013		1.87	%

Total Common Stocks
(Cost $88,298,786)				110,356,608		94.41	%

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

SHORT-TERM INVESTMENTS – 3.48%	Number				% of
	of Shares		Value		Net Assets
Money Market Funds – 3.48%
Fidelity Government Portfolio –
Institutional Class, 0.01% (b)		4,067,705	$	4,067,705		3.48	%

Total Money Market Funds
(Cost $4,067,705)				4,067,705		3.48	%

Total Short-Term Investments
(Cost $4,067,705)				4,067,705		3.48	%

Total Investments
(Cost $92,366,491) – 97.89%				114,424,313		97.89	%
Other Assets in Excess
of Liabilities – 2.11%				2,465,060		2.11	%
TOTAL NET ASSETS – 100.00%			$	116,889,373		100.00	%

Percentages are stated as a percent of net assets.

(a)	Non-income producing security.
(b)	The rate listed is the fund’s 7-day yield as of April 30, 2014.

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	20,433,033	$	—	$	—	$	20,433,033
Consumer Staples		22,243,762		—		—		22,243,762
Energy		15,625,637		—		—		15,625,637
Health Care		6,652,444		—		—		6,652,444
Industrials		24,919,428		—		—		24,919,428
Information Technology		18,300,291		—		—		18,300,291
Materials		2,182,013		—		—		2,182,013
Total Common Stock	$	110,356,608	$	—	$	—	$	110,356,608
Short-Term Investments
Money Market Funds	$	4,067,705	$	—	$	—	$	4,067,705
Total Short-Term Investments	$	4,067,705	$	—	$	—	$	4,067,705
Total Investments	$	114,424,313	$	—	$	—	$	114,424,313

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized no transfers between levels.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $92,366,491)	$	114,424,313
Dividends and interest receivable		81,349
Receivable for fund shares sold		2,528,381
Prepaid expenses and other assets		17,616
Total Assets		117,051,659

LIABILITIES:
Payable for fund shares redeemed		15,200
Payable to advisor		68,568
Payable to administrator		35,997
Payable to auditor		13,698
Accrued service fees		7,871
Accrued interest payable		70
Accrued trustees fees		4,705
Accrued expenses and other payables		16,177
Total Liabilities		162,286
NET ASSETS	$	116,889,373

NET ASSETS CONSIST OF:
Capital stock	$	81,062,020
Accumulated net investment income		545,331
Accumulated net realized gain on investments		13,224,200
Unrealized net appreciation on investments		22,057,822
Total Net Assets	$	116,889,373

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		97,926,420
Shares issued and outstanding		6,807,249
Net asset value, offering price and redemption price per share	$	14.39

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares		18,962,953
Shares issued and outstanding		1,307,178
Net asset value, offering price and redemption price per share	$	14.51

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income	$	1,166,055
Interest income		189
Total investment income		1,166,244

EXPENSES:
Investment advisory fees		399,157
Administration, fund accounting, custody and transfer agent fees		107,880
Service fees – Investor Class (See Note 5)		45,745
Federal and state registration fees		17,901
Sub-transfer agent expenses – Investor Class (See Note 5)		14,411
Sub-transfer agent expenses – Institutional Class (See Note 5)		4,924
Compliance expense		10,655
Audit fees		8,855
Trustees’ fees and expenses		7,289
Reports to shareholders		5,852
Legal fees		2,480
Other expenses		6,489
Total expenses before waiver		631,638
Administration expense waiver (See Note 5)		(10,725	)
Net expenses		620,913
NET INVESTMENT INCOME	$	545,331

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	16,269,997
Change in unrealized appreciation on investments		(3,817,772	)
Net gain on investments		12,452,225
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	12,997,556

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

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HENNESSYFUNDS.COM

Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment income	$	545,331		$	1,194,449
Net realized gain on securities		16,269,997			6,201,807
Change in unrealized appreciation (depreciation) on securities		(3,817,772	)		17,304,019
Net increase in net assets resulting from operations		12,997,556			24,700,275

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Investor Class		(985,143	)		(719,396	)
Institutional Class		(209,291	)		(361,073	)
Net realized gains
Investor Class		(4,397,057	)		(117,309	)
Institutional Class		(781,018	)		(52,078	)
Total distributions		(6,372,509	)		(1,249,856	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		2,125,396			1,740,370
Proceeds from shares subscribed – Institutional Class		2,651,544			815,827
Dividends reinvested – Investor Class		5,021,319			780,066
Dividends reinvested – Institutional Class		949,886			406,311
Cost of shares redeemed – Investor Class		(3,615,427	)		(8,522,055	)
Cost of shares redeemed – Institutional Class		(1,828,759	)(1)		(23,485,757	)
Net increase (decrease) in net assets derived
from capital share transactions		5,303,959			(28,265,238	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		11,929,006			(4,814,819	)

NET ASSETS:
Beginning of period		104,960,367			109,775,186
End of period	$	116,889,373		$	104,960,367
Undistributed net investment income, end of period	$	545,331		$	1,194,434

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		151,883			149,494
Shares sold – Institutional Class		187,576			68,395
Shares issued to holders as reinvestment
of dividends – Investor Class		375,434			72,353
Shares issued to holders as reinvestment
of dividends – Institutional Class		70,320			37,405
Shares redeemed – Investor Class		(264,468	)		(720,532	)
Shares redeemed – Institutional Class		(133,936	)		(2,050,571	)
Net increase (decrease) in shares outstanding		386,809			(2,443,456	)

(1)	Net of redemption fees of $3 related to redemption fees imposed by the FBR Large Cap Fund (which was reorganized into the Fund) during a prior year but not received until the six-month period ended April 30, 2014.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Cornerstone Large Growth Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	13.56

Income from investment operations:
Net investment income		0.06
Net realized and unrealized gains (losses) on securities		1.59
Total from investment operations		1.65

Less distributions:
Dividends from net investment income		(0.14	)
Dividends from net realized gains		(0.68	)
Total distributions		(0.82	)
Net asset value, end of period	$	14.39

TOTAL RETURN		12.70	%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	97.93
Ratio of expenses to average net assets:
Before expense reimbursement/recoupment		1.18	%(5)
After expense reimbursement/recoupment		1.18	%(5)
Ratio of net investment income to average net assets:
Before expense reimbursement/recoupment		0.98	%(5)
After expense reimbursement/recoupment		0.98	%(5)
Portfolio turnover rate(6)		49	%(4)

(1)	For the one month ended October 31, 2009. Effective October 31, 2009, the Fund changed its fiscal year end to October 31 from September 30.
(2)	The financial highlights set forth for periods prior to March 20, 2009 represent the historical financial highlights of the Tamarack Large Cap Growth Fund, Class S shares. The assets of the Tamarack Large Cap Growth Fund were acquired by the Hennessy Cornerstone Large Growth Fund on March 20, 2009. At the time, RBC Global Asset Management (U.S.), Inc. (formerly known as Voyageur Asset Management, Inc.) ceased to be investment advisor and Hennessy Advisors, Inc. became investment advisor. The return of the Tamarack Large Cap Growth Fund, Class S shares during the period October 1, 2008 through March 20, 2009 was (33.30)%. The return of the Hennessy Cornerstone Large Growth Fund, Original Class shares during the period March 20, 2009 through September 30, 2009 was 42.64%.
(3)	Amount is less than $0.01 or ($0.01).
(4)	Not annualized.
(5)	Annualized.
(6)	Portfolio turnover is calculated on the basis of the Fund as a whole.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

												One Month Ended			Year Ended
Year Ended October 31,												October 31,			September 30,
2013			2012			2011			2010			2009(1)			2009(2)

$	10.77		$	12.37		$	11.70		$	9.49		$	9.60		$	10.09


	0.14			0.13			0.09			0.09			0.00	(3)		0.05
	2.77			0.80			0.69			2.17			(0.11	)		(0.54	)
	2.91			0.93			0.78			2.26			(0.11	)		(0.49	)


	(0.10	)		(0.07	)		(0.09	)		(0.05	)		—			—
	(0.02	)		(2.46	)		(0.02	)		—			—			—
	(0.12	)		(2.53	)		(0.11	)		(0.05	)		—			—
$	13.56		$	10.77		$	12.37		$	11.70		$	9.49		$	9.60

	27.32	%		9.14	%		6.70	%		23.88	%		(1.15	)%(4)		(4.86	)%


$	88.77		$	75.83		$	77.88		$	78.83		$	69.41		$	70.61

	1.19	%		1.27	%		1.26	%		1.30	%		1.26	%(5)		1.40	%
	1.19	%		1.27	%		1.30	%		1.30	%		1.30	%(5)		1.17	%

	1.10	%		1.35	%		0.72	%		0.84	%		(0.01	)%(5)		0.36	%
	1.10	%		1.35	%		0.68	%		0.84	%		(0.05	)%(5)		0.59	%
	73	%		0	%		70	%		83	%		0	%(4)		116	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Cornerstone Large Growth Fund

For an Institutional Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	13.68

Income from investment operations:
Net investment income		0.09
Net realized and unrealized gains (losses) on securities		1.59
Total from investment operations		1.68

Less distributions:
Dividends from net investment income		(0.17	)
Dividends from net realized gains		(0.68	)
Total distributions		(0.85	)
Net asset value, end of period	$	14.51

TOTAL RETURN		12.81	%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	18.96
Ratio of expenses to average net assets:
Before expense reimbursement		1.11	%(5)
After expense reimbursement		0.98	%(5)
Ratio of net investment income to average net assets:
Before expense reimbursement		1.06	%(5)
After expense reimbursement		1.19	%(5)
Portfolio turnover rate(6)		49	%(4)

(1)	For the one month ended October 31, 2009. Effective October 31, 2009, the Fund changed its fiscal year end to October 31 from September 30.
(2)	Institutional Class shares commenced operations on March 20, 2009.
(3)	Amount is less than $0.01 or ($0.01).
(4)	Not annualized.
(5)	Annualized.
(6)	Portfolio turnover is calculated on the basis of the Fund as a whole.

The accompanying notes are an integral part of these financial statements.

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												One Month Ended			Period Ended
Year Ended October 31,												October 31,			September 30,
2013			2012			2011			2010			2009(1)			2009(2)

$	10.85		$	12.44		$	11.76		$	9.51		$	9.61		$	6.73


	0.09			0.07			0.08			0.10			0.00	(3)		0.03
	2.88			0.89			0.74			2.20			(0.10	)		2.85
	2.97			0.96			0.82			2.30			(0.10	)		2.88


	(0.12	)		(0.09	)		(0.12	)		(0.05	)		—			—
	(0.02	)		(2.46	)		(0.02	)		—			—			—
	(0.14	)		(2.55	)		(0.14	)		(0.05	)		—			—
$	13.68		$	10.85		$	12.44		$	11.76		$	9.51		$	9.61

	27.63	%		9.43	%		6.99	%		24.26	%		(1.04	)%(4)		42.79	%(4)


$	16.19		$	33.94		$	0.14		$	0.07		$	0.04		$	0.04

	1.10	%		1.41	%		1.14	%		1.16	%		1.14	%(5)		16.51	%(5)
	0.98	%		0.98	%		0.98	%		0.98	%		0.98	%(5)		0.98	%(5)

	1.38	%		6.44	%		0.81	%		0.90	%		0.12	%(5)		(14.54	)%(5)
	1.50	%		6.87	%		0.97	%		1.08	%		0.28	%(5)		0.99	%(5)
	73	%		0	%		70	%		83	%		0	%(4)		116	%(4)

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Cornerstone Large Growth Fund (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The investment objective of the Fund is long-term growth of capital. The Fund is a diversified fund.

The Fund offers Investor Class and Institutional Class shares. Prior to October 26, 2012, the Investor Class shares were known as Original Class shares. Each class of shares differs principally in its respective administration, 12b-1 distribution and service fees, shareholder servicing, and transfer agent expenses and sales charges, if any. Each class has identical rights to earnings, assets, and voting privileges, except for class-specific expenses and exclusive rights to vote on matters affecting only individual classes.

2). SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of the financial statements. These policies are in conformity with U.S. generally accepted accounting principles (“GAAP”).

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis. The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its respective net assets.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out annually, usually in November or December. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the trade date. The Fund determines the gain or loss realized from the investment

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	transactions by comparing the original cost of the security lot sold with the net sale proceeds. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies, if any, are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.
	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions and concluded that there is no impact on the Fund’s net assets and no

HENNESSY FUNDS 1-800-966-4354

	tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

The Fund has adopted authoritative fair valuation accounting standards that establish an authoritative definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion in changes in valuation techniques and related inputs during the period. These inputs are summarized in the three broad levels listed below:

	Level 1 –	Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.
	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.
	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those

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inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

Equity Securities – Equity securities, including common stocks, preferred stocks, foreign issued common stocks, exchange traded funds, closed-end mutual funds, and real estate investment trusts, that are traded on a securities exchange for which a last-quoted sales price is readily available will be valued at the last sales price as reported by the primary exchange on which the securities are listed. Securities listed on The NASDAQ Stock Market (“NASDAQ”) will be valued at the NASDAQ Official Closing Price, which may differ from the last sales price reported. Securities traded on a securities exchange for which a last-quoted sales price is not readily available will be valued at the mean between the bid and ask prices. To the extent these securities are actively traded and valuation adjustments are not applied, they are classified in Level 1 of the fair value hierarchy.

Investment Companies – Investments in investment companies (e.g., mutual funds and exchange traded funds) are generally priced at the ending NAV provided by the Fund’s service agent and will be classified in Level 1 of the fair value hierarchy.

Debt Securities – Debt securities, including corporate bonds, asset-backed securities, mortgage-backed securities, municipal bonds, U.S. Treasuries, and U.S. government agency issues, are valued at market on the basis of valuations furnished by an independent pricing service that utilizes both dealer-supplied valuations and formula-based techniques. The pricing service may consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads, and fundamental data relating to the issuer. In addition, the model may incorporate market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers, and reference data. Certain securities are valued principally using dealer quotations. These securities are generally classified in Level 2 of the fair value hierarchy.

Short-Term Securities – Short-term equity investments, including money market funds, are valued in the manner specified above. Short-term debt investments are valued at amortized cost, if their original maturity was 60 days or less, or by amortizing the values as of the 61st day prior to maturity, if their original term to maturity exceeded 60 days. Short-term securities are generally classified in Level 1 or Level 2 of the fair market hierarchy depending on the inputs used and market activity levels for specific securities.

The Board of Trustees of the Fund (the “Board”) has adopted fair value pricing procedures that are followed when a price for a security is not readily available or if a significant event has occurred that indicates the closing price of a security no longer represents the true value of that security. Fair value pricing determinations are made in good faith in accordance with these procedures. There are numerous criteria that will be given consideration in determining a fair value of a security. Some of these criteria are trading volume of security and markets, the value of other like securities, and news events with direct bearing to security or market. Fair value pricing results in an estimated price that reasonably reflects the current market conditions in order to rate the portfolio holdings such that shareholder transactions receive a fair net asset value. Depending on the relative significance of the valuation inputs, these securities may be classified in either Level 2 or Level 3 of the fair value hierarchy.

HENNESSY FUNDS 1-800-966-4354

relevant American Depositary Receipts or futures contracts. The effect of using fair value pricing is that the Fund’s NAV will reflect the affected portfolio securities’ value as determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price foreign securities may result in a value that is different from a foreign security’s most recent closing price and from the prices used by other investment companies to calculate their net asset values and are generally considered Level 2 prices in the fair valuation hierarchy. Because the Fund may invest in foreign securities, the value of the Fund’s portfolio securities may change on days when you will not be able to purchase or redeem your shares.

The Board has delegated day-to-day valuation matters to a Valuation Committee comprised of one or more representatives from Hennessy Advisors, Inc., the Fund’s investment advisor. The function of the Valuation Committee is to value securities where current and reliable market quotations are not readily available. All actions taken by the Valuation Committee are reviewed by the Board.

The Fund has performed an analysis of all existing investments to determine the significance and character of all inputs to their fair value determination. Various inputs are used in determining the value of the Fund’s investments. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. Details related to the fair valuation hierarchy of the Fund’s securities as of April 30, 2014 are included in the Fund’s Schedule of Investments.

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $52,053,924 and $57,750,003, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund during the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Hennessy Advisors, Inc. (the “Advisor”) is the investment advisor of the Fund. The Advisor provides the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnishes 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 from the Fund. The fee is based upon the average daily net assets of the Fund at the annual rate of 0.74%. The net investment advisory fees payable for the Fund as of April 30, 2014 were $68,568.

The Advisor has agreed to waive its fees and absorb expenses to the extent that the total annual operating expenses (excluding all Federal, state and local taxes, interest, brokerage commissions, acquired fund fees and expenses and other costs incurred in connection with the purchase and sale of securities and extraordinary items) exceed 0.98% of the Fund’s net assets for the Institutional Class shares of the Fund. The expense limitation agreement for the Institutional Class shares can only be terminated by the Board.

For a period of three years after the year in which the Advisor waives or reimburses expenses, the Advisor may seek reimbursement from the Fund to the extent that total annual fund operating expenses are less than the expense limitation in effect at the time of the reimbursement. During the three years ended October 31, 2013, no Advisor fees were waived and therefore no expenses are subject to potential recovery.

The Board has approved a Shareholder Servicing Agreement for the Investor Class shares of the Fund, which was instituted to compensate the Advisor for the non-

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investment management services it provides to the Fund. The Shareholder Servicing Agreement provides for a monthly fee paid to the Advisor at an annual rate of 0.10% of the average daily net assets of the Fund attributable to Investor Class shares. Shareholder servicing fees payable for the Fund as of April 30, 2014 were $7,871.

The Fund has entered into agreements with various brokers, dealers, and financial intermediaries in connection with the sale of shares of the Fund. The agreements provide for periodic payments by the Fund to the brokers, dealers, and financial intermediaries for providing certain shareholder maintenance services (sub-transfer agent expenses). These shareholder services include the pre-processing and quality control of new accounts, shareholder correspondence, answering customer inquiries regarding account status, and facilitating shareholder telephone transactions. Fees paid by the Fund to various brokers, dealers, and financial intermediaries for the six months ended April 30, 2014 were $19,335.

U.S. Bancorp Fund Services, LLC (“USBFS”) provides the Fund with administrative, fund accounting, and transfer agent services, including all regulatory reporting, and necessary office equipment and personnel. As administrator, USBFS prepares various federal and state regulatory filings, reports, and returns for the Fund; prepares reports and materials to be supplied to the Board; monitors the activities of the Fund’s custodian, transfer agent, and accountants; and coordinates the preparation and payment of the Fund’s expenses and reviews the Fund’s expense accruals. Fees paid to USBFS for the six months ended April 30, 2014 were $97,155.

USBFS has voluntarily waived all or a portion of its fees allocated to the Institutional Class shares of the Fund. The administration fees voluntarily waived by USBFS during the six months ended April 30, 2014 were $10,725.

U.S. Bank, N.A., an affiliate of USBFS, serves as the Fund’s custodian. Quasar Distributors, LLC acts as the Fund’s principal underwriter in a continuous public offering of the Fund’s shares. Quasar Distributors, LLC is an affiliate of USBFS and U.S. Bank, N.A.

6). LINE OF CREDIT

The Fund has a line of credit with the other funds in the Hennessy Funds family of funds (the “Hennessy Funds”) in the amount of the lesser of (i) $100,000,000 or (ii) 33.33% of each Hennessy Fund’s net assets, or 30% for the Hennessy Gas Utility Index Fund and 10% for the Hennessy Balanced Fund, intended to provide short-term financing, if necessary, subject to certain restrictions, in connection with shareholder redemptions. The credit facility is with the Hennessy Funds’ custodian bank, U.S. Bank, N.A. Borrowings under this arrangement bear interest at the bank’s prime rate. During the six months ended April 30, 2014, the Fund did not have any borrowings outstanding under the line of credit.

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	79,154,555
Gross tax unrealized appreciation	$	26,254,879
Gross tax unrealized depreciation		(379,285	)
Net tax unrealized appreciation/depreciation	$	25,875,594
Undistributed ordinary income	$	1,205,676
Undistributed long-term capital gains		5,166,795
Total distributable earnings	$	6,372,471
Other accumulated gain (loss)	$	(3,045,759	)
Total accumulated gain (loss)	$	29,202,306

HENNESSY FUNDS 1-800-966-4354

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had capital loss carryforwards that expire as follows:

$3,045,759

10/31/16

During the year ended October 31, 2013, the Fund’s most recent fiscal year end, the capital loss carry forwards utilized for the Fund were $1,015,253.

Capital losses sustained in the year ended October 31, 2012 and in future taxable years will not expire and may be carried over by the Fund without limitation; however, they will retain the character of the original loss. Furthermore, any losses incurred during those taxable years will be required to be utilized prior to the losses incurred in the pre-enactment taxable years. As a result of this ordering rule, pre-enactment capital loss carryforwards may be more likely to expire unused. Under pre-enactment law, capital losses could be carried forward for eight years, and carried forward as short-term capital losses, irrespective of the character of the original loss.

At October 31, 2013, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals or post-December loss deferrals.

The tax character of distributions paid during fiscal year 2014 (year-to-date) and fiscal year 2013 for the Fund were as follows:

	Six Months Ended		Year Ended
	April 30, 2014		October 31, 2013
Ordinary income	$	1,205,687	$	1,080,469
Long-term capital gain		5,166,822		169,387
	$	6,372,509	$	1,249,856

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Expense Example (Unaudited)

April 30, 2014

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; service fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from November 1, 2013 through April 30, 2014.

Actual Expenses

The first line of the table below under the “Investor Class” and “Institutional Class” headings provides information about actual account values and actual expenses. Although the Fund charges no sales loads or transaction fees, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent. If you request that a redemption be made by wire transfer, currently a $15.00 fee is charged by the Fund’s transfer agent. IRA accounts will be charged a $15.00 annual maintenance fee. The example below includes, but is not limited to, management fees, shareholder servicing fees, fund accounting, custody, and transfer agent fees. However, the example below does not include portfolio trading commissions and related expenses, and other extraordinary expenses as determined under generally accepted accounting principles. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of the table under the “Investor Class” and “Institutional Class” headings in the column entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below under the “Investor Class” and “Institutional Class” headings provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or exchange fees. Therefore, the second line of the table under the “Investor Class” and “Institutional Class” headings is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$1,127.00	$6.22

Hypothetical (5% return
before expenses)	$1,000.00	$1,018.94	$5.91

Institutional Class

Actual	$1,000.00	$1,128.10	$5.17

Hypothetical (5% return
before expenses)	$1,000.00	$1,019.93	$4.91

(1)	Expenses are equal to the Fund’s annualized expense ratio of 1.18% for Investor Class shares or 0.98% for Institutional Class shares, as applicable, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

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Proxy Voting

A description of the policies and procedures the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge: (1) by calling 1-800-966-4354; (2) on the Hennessy Funds’ website at hennessyfunds.com; or (3) on the U.S. Securities and Exchange Commission’s (the “SEC”) website at www.sec.gov. The Fund’s proxy voting record is available on both the Hennessy Funds’ website at hennessyfunds.com and the SEC’s website at www.sec.gov no later than August 31 for the prior 12 months ending June 30.

Quarterly Filings on Form N-Q

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the SEC’s website at www.sec.gov. The Fund’s Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. Information included in the Fund’s Forms N-Q will also be available upon request by calling 1-800-966-4354.

Federal Tax Distribution Information

(Unaudited)

For the fiscal year ended October 31, 2013, certain dividends paid by the Fund may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The percentage of dividends declared from ordinary income designated as qualified dividend income was 100.00%.

For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the fiscal year ended October 31, 2013 was 100.00%.

The percentage of taxable ordinary income distributions that are designated as short-term capital gain distributions under Section 871(k)(2)(C) of the Internal Revenue Code of 1986, as amended, for the Fund was 0.00%.

Householding

To help keep the Fund’s costs as low as possible, we generally deliver a single copy of most financial reports and prospectuses to shareholders who share an address, even if the accounts are registered under different names. This process, known as “householding,” does not apply to account statements. You may, of course, request an individual copy of a prospectus or financial report at any time. If you would like to receive separate mailings, please call the Administrator at 1-800-261-6950 or 1-414-765-4124 and we will begin individual delivery within 30 days of your request. If your account is held through a financial institution or other intermediary, please contact them directly to request individual delivery.

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreement

At its meeting on March 3, 2014, the Board of Trustees of the Fund (the “Board”) unanimously approved the continuation of the investment advisory agreement of the Fund.

The Board reviewed a number of documents, including a memorandum provided by outside legal counsel that described the fiduciary duties of the Board with respect to approving the continuance of the investment advisory agreement and the relevant factors for consideration, a memorandum from the Advisor that listed each of the relevant factors and the documents provided to help the Board assess each such factor, the Advisor’s most recent Form 10-K and 10-Q, the Advisor’s Form ADV Part I, a document that listed the range of services provided by the Advisor for the Fund, a written discussion of economies of scale, a copy of the advisory agreement, a fund fact sheet, and peer expense and performance comparisons. The Board considered and discussed numerous factors, including the following:

•

The Board considered the services identified below that are provided by the Advisor:

		•	The Advisor acts as portfolio manager for the Fund. In this capacity, the Advisor manages the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
		•	The Advisor performs daily reconciliations of portfolio positions and cash for the Fund.
		•	The Advisor manages the use of soft dollars for the Fund.
		•	The Advisor monitors compliance by the Fund with its investment objectives and restrictions.
		•	The Advisor monitors compliance with federal securities laws and performs activities such as maintaining a compliance program, conducting ongoing reviews of the compliance programs of the Fund’s service providers, conducting on-site visits to the Fund’s service providers, monitoring incidents of abusive trading practices, reviewing Fund expense accruals, payments, and fixed expense ratios, evaluating insurance providers for fidelity bond coverage and D&O/E&O insurance coverage, conducting employee compliance training, reviewing reports provided by service providers, maintaining books and records, and preparing an annual compliance report to the Board.
		•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, custodial, sales and marketing, audit, information technology, and legal services.
		•	The Advisor maintains an in-house public relations and marketing department on behalf of the Fund.
		•	The Advisor is actively involved with preparing regulatory filings for the Fund.
		•	The Advisor manages proxy voting for the Fund.
		•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab, Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund,

HENNESSYFUNDS.COM

			which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
		•	The Advisor pays the incentive compensation of all of the Fund’s compliance officers and employs other staff such as management executives, legal personnel, marketing personnel, national accounts and distribution personnel, sales personnel, and trading oversight personnel.
		•	The Advisor prepares or reviews Board materials, frequently presents to the Board or leads Board discussions, prepares or reviews meeting minutes, and arranges for Board training and education.

	•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the continuation of the advisory agreement.
	•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
	•	The Board considered the fees charged by the Advisor to those of funds similar in asset size and investment objective to the Fund and concluded the advisory fee of the Fund was reasonable and warranted continuation of the advisory agreement. The Trustees noted that the investment advisory fees are not adjusted if economies of scale are realized as the Fund grows because many of the expenses incurred by the Advisor to manage the Fund are asset-based fees and thus do not result in material economies of scale being realized as the net assets of the Fund increase.
	•	The Board considered the profitability of the Advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
	•	The Board considered the high level of professionalism and knowledge of the Advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

All of the factors above were considered separately by the Board, including the Trustees who are not “interested persons” (as defined in the Investment Company Act of 1940, as amended) of the Fund (the “Independent Trustees”) meeting in an executive session. The factors were viewed in their totality by the Board, with no single factor being the principal or determinative factor in the Board’s determination of whether to approve the continuation of the advisory agreement. Based on the factors discussed above, the Board, including all of the Independent Trustees, recommended continuation of the advisory agreement.

HENNESSY FUNDS 1-800-966-4354

For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

KPMG LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY LARGE VALUE FUND

Investor Class HLVFX

Institutional Class HLVIX

hennessyfunds.com | 1-800-966-4354

(This Page Intentionally Left Blank.)

Contents

Letter to Shareholders	2
Performance Overview	4
Financial Statements
Schedule of Investments	7
Statement of Assets and Liabilities	13
Statement of Operations	14
Statements of Changes in Net Assets	16
Financial Highlights	18
Notes to the Financial Statements	22
Expense Example	29
Proxy Voting	31
Quarterly Filings on Form N-Q	31
Federal Tax Distribution Information	31
Householding	31
Board Approval of Investment Advisory Agreements	32

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

HENNESSYFUNDS.COM

Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Dow Jones Industrial Average and S&P 500 are unmanaged indices commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014

	Six	One	Five	Ten
	Months(1)	Year	Years	Years
Hennessy Large Value Fund –
Investor Class (HLVFX)	7.57%	17.24%	16.37%	6.15%
Hennessy Large Value Fund –
Institutional Class (HLVIX)(2)	7.77%	17.65%	16.81%	6.36%
Russell 1000® Value Index	9.61%	20.90%	19.52%	7.95%
S&P 500 Index	8.36%	20.44%	19.14%	7.67%

Expense ratios: 1.33% (Investor Class); Gross 1.14%, Net 0.98%(3) (Institutional Class)

Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance for periods prior to March 20, 2009 reflects the performance of the Tamarack Value Fund, the predecessor to the Hennessy Large Value Fund. Performance data current to the most recent month end may be obtained by visiting hennessyfunds.com.

The expense ratios presented are from the most recent prospectus.

(1)	Periods less than one year are not annualized.
(2)	The inception date of the Institutional Class shares is March 20, 2009. Performance shown prior to the inception of the Institutional Class shares reflects the performance of the Tamarack Value Fund’s Class S shares and includes expenses that are not applicable to and are different than those of the Investor Class and Institutional Class shares.
(3)	With regard to Institutional Class shares, the Fund’s investment advisor has contractually agreed to waive a portion of its expenses indefinitely.

PERFORMANCE NARRATIVE

RBC GLOBAL ASSET MANAGEMENT (U.S.) INC., SUB-ADVISOR

Portfolio Managers Stuart Lippe, Barbara Browning, CFA, and Adam Scheiner, CFA, RBC Global Asset Management (U.S.) Inc. (sub-advisor)

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Investor Class of the Hennessy Large Value Fund returned 7.57%, underperforming the Russell 1000® Value Index, the S&P 500 Index, and the Morningstar Large Value Category Average, which returned 9.61%, 8.36%, and 8.14% for the same period, respectively.

While the Fund had strong absolute performance for the six-month period, its relative underperformance was driven by stock selection across a number of sectors including Health Care, Materials, Consumer Discretionary, Financials, Utilities, Consumer Staples and Telecommunications. Conversely, stock selection in the Energy, Industrials,

HENNESSYFUNDS.COM

and Information Technology sectors benefited performance. Sector allocation detracted modestly from performance as the Fund’s sector neutral mandate, by design, limits the impact of sector weighting decisions. We instead make investment decisions at the industry level.

Within the Health Care sector, not owning Merck & Co., Inc. (up 32% during the six-month period) hurt relative performance. Merck & Co., Inc. reported strong earnings and experienced higher than expected sales throughout much of its product line. The Fund’s overweight position in Pfizer, Inc. partially offset this, as some excitement over the company’s oncology pipeline and a solid beating of earnings created significant interest in the stock. Also, the Fund’s slight overweight position in Johnson & Johnson benefited performance as the stock was up nearly 11% during the six-month period. A solid quarter on the back of the fact that Johnson & Johnson has one of the youngest and strongest drug portfolios in the industry propelled the stock. The company has strong entries in atrial fibrillation (Eliquis), diabetes (Invokana) and prostate cancer (Zytiga), which continue to push the stock higher. The Fund continues to hold positions in Pfizer Inc. and Johnson & Johnson.

Stock selection in the Materials sector was also a significant detractor from relative performance over the six-month period. The Fund’s overweight position in Freeport-McMoRan Copper & Gold, Inc. hurt performance as the stock was down 16% during the Fund’s holding period. The stock was impacted by the announcement of an export tax from Indonesia, which is where the company’s largest and lowest cost mine is located, a slowing in Chinese economic data (China is the company’s largest user of copper), and a corporate bond default in China that scared the market as copper is often used as collateral in financing in the region. The Fund’s overweight position in Huntsman Corporation and CF Industries Holdings, Inc., partially offset the negative performance of Freeport-McMoRan Copper & Gold, Inc. The Fund no longer holds Freeport-McMoRan Copper & Gold Inc. or CF Industries Holdings, Inc.

On the positive side of the ledger, stock selection within the Energy sector added to the relative performance of the Fund. Helmerich & Payne, Inc. and Exxon Mobil Corporation were both strong performers. Helmerich & Payne, Inc. has been the single best performing energy stock in the Russell 1000® Value Index benchmark over the last six months, returning close to 42% over the period. The stock has benefited from a variety of factors, including having the most technologically advanced fleet of rigs of any of the land drillers. Demand and pricing for land rigs have been excellent as both majors and independent exploration and production companies have started to intensify their spending in the Permian, Eagle Ford, Marcellus, and other promising U.S. oil fields. The Fund’s allocation to Exxon Mobil Corporation benefited performance as the stock reported better than expected earnings, and for the first time in many quarters output numbers did not disappoint. Net income rose nicely, and the stock was up nearly 16% over the six–month period. The Fund continues to hold both of these positions.

Additional Portfolio Manager commentary and related investment outlook:

We remain confident in our stock selection-driven process and our ability to find special situation stocks that we believe can outperform regardless of the market environment. While investment decisions are the result of bottom-up stock selection, and our sector-neutral mandate requires investment in all ten major sectors, there are a number of industry-based themes that we believe could lead to outperformance as we head further into 2014. With respect to consumer spending, consumers are spending more of their dollars on housing related, durable goods related, and hard-line retail related (home and auto) items, and less on soft-line and multi-line retail-related items (apparel and shoes).

HENNESSY FUNDS 1-800-966-4354

This trend has been apparent in company results and stock performance through 2013 and the beginning of 2014, and while we think it will continue, we are looking for opportunities in stocks that have over-discounted this theme.

In regard to technology, trends in the industry continue to favor companies exposed to the secular growth areas of mobile, cloud, and IT as a service. We continue to look for attractively valued opportunities in these areas rather than the legacy enterprise IT names. We are overweight semiconductors as we look for exposure to the Internet of Things (IoT). Essentially, IoT is the idea of everyday things becoming “connected” or “smart.” This transition is occurring in autos through infotainment offerings, safety features, and fuel efficiency mechanisms that all require integrated circuits and sensors to communicate, measure, and process data. The theme is also accelerating in industrial automation, appliances, and fitness wearables to name a few areas. While IoT is still in its infancy, we are seeing strong penetration in autos and other industrial end markets.

We also expect a continued rebound in capital market activity to positively impact the Fund’s holdings in asset managers and money center banks and an increased utilization in the health care industry prompted by health care reform (specifically with regard to managed care) to support our overweight position in health care providers and services.

_______________

The Russell 1000® Value Index is an unmanaged index commonly used to measure the performance of U.S. large-capitalization value stocks. The S&P 500 Index is an unmanaged index commonly used to measure the performance of U.S. stocks. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund may invest in medium-capitalization companies, which may have more limited liquidity and greater price volatility than large-capitalization companies. References to specific securities should not be considered a recommendation to buy or sell any security. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

HENNESSYFUNDS.COM

Schedule of Investments

HENNESSY LARGE VALUE FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Wells Fargo & Co.	4.58%
	Pfizer, Inc.	3.76%
	J.P. Morgan Chase & Co.	3.47%
	Chevron Corp.	3.44%
	Johnson & Johnson	3.14%
	Exxon Mobil Corp.	3.05%
	Helmerich & Payne, Inc.	2.77%
	Apple, Inc.	2.21%
	The Walt Disney Co.	2.09%
	Medtronic, Inc.	1.99%

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS – 96.13%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 6.38%
Ford Motor Co.		120,665	$	1,948,740		1.31	%
Lowes Companies, Inc.		19,060		875,044		0.58	%
Macy’s, Inc.		26,135		1,500,933		1.01	%
The Walt Disney Co.		39,195		3,109,731		2.09	%
Time Warner, Inc.		31,195		2,073,220		1.39	%
				9,507,668		6.38	%

Consumer Staples – 4.21%
CVS Caremark Corp.		33,480		2,434,666		1.63	%
Kraft Foods Group, Inc.		37,880		2,153,857		1.45	%
Procter & Gamble Co.		20,410		1,684,845		1.13	%
				6,273,368		4.21	%

Energy – 15.28%
Anadarko Petroleum Corp.		22,395		2,217,553		1.49	%
Chevron Corp.		40,825		5,124,354		3.44	%
Exxon Mobil Corp.		44,385		4,545,468		3.05	%
Helmerich & Payne, Inc.		37,995		4,128,157		2.77	%
Marathon Oil Corp.		63,050		2,279,258		1.53	%
Pioneer Natural Resources Co.		11,560		2,234,201		1.50	%
Valero Energy Corp.		39,020		2,230,773		1.50	%
				22,759,764		15.28	%

Financials – 24.25%
Affiliated Managers Group, Inc. (a)		5,950		1,179,290		0.79	%
Allstate Corp.		40,810		2,324,129		1.56	%
American International Group, Inc.		28,200		1,498,266		1.01	%
BlackRock, Inc.		6,990		2,103,990		1.41	%
Citigroup, Inc.		50,455		2,417,299		1.62	%
Genworth Financial, Inc. (a)		86,150		1,537,777		1.03	%
Hartford Financial Services Group, Inc.		48,945		1,755,657		1.18	%
J.P. Morgan Chase & Co.		92,365		5,170,593		3.47	%
Marsh & McLennan Companies, Inc.		39,595		1,952,429		1.31	%
MetLife, Inc.		32,965		1,725,718		1.16	%
Morgan Stanley		66,875		2,068,444		1.39	%
Regions Financial Corp.		132,540		1,343,956		0.90	%
State Street Corp.		18,895		1,219,861		0.82	%

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Financials (Continued)
SunTrust Banks, Inc.		32,875	$	1,257,797		0.85	%
The PNC Financial Services Group, Inc.		20,780		1,746,351		1.17	%
Wells Fargo & Co.		137,340		6,817,558		4.58	%
				36,119,115		24.25	%

Health Care – 13.20%
C.R. Bard, Inc.		7,775		1,067,741		0.72	%
CIGNA Corp.		29,525		2,363,181		1.59	%
Covidien PLC (b)		30,340		2,161,725		1.45	%
Johnson & Johnson		46,150		4,674,533		3.14	%
McKesson Corp.		4,805		812,958		0.55	%
Medtronic, Inc.		50,400		2,964,528		1.99	%
Pfizer, Inc.		179,210		5,605,689		3.76	%
				19,650,355		13.20	%

Industrials – 10.89%
Caterpillar, Inc.		20,140		2,122,756		1.42	%
Danaher Corp.		19,490		1,430,176		0.96	%
Delta Air Lines, Inc.		37,065		1,365,104		0.92	%
General Dynamics Corp.		20,230		2,214,174		1.49	%
General Electric Co.		69,230		1,861,595		1.25	%
Honeywell International, Inc.		22,115		2,054,483		1.38	%
Ingersoll-Rand PLC (b)		23,575		1,409,785		0.95	%
Lockheed Martin Corp.		7,435		1,220,381		0.82	%
Parker Hannifin Corp.		8,645		1,096,878		0.73	%
Ryder System, Inc.		17,585		1,445,135		0.97	%
				16,220,467		10.89	%

Information Technology – 10.50%
Adobe Systems, Inc. (a)		20,540		1,267,113		0.85	%
Apple, Inc.		5,560		3,280,900		2.21	%
Autodesk, Inc. (a)		22,705		1,090,294		0.73	%
Cisco Systems, Inc.		80,525		1,860,933		1.25	%
Hewlett-Packard Co.		46,925		1,551,340		1.04	%
LAM Research Corp. (a)		16,295		938,755		0.63	%
Microchip Technology, Inc.		19,180		911,817		0.61	%
NXP Semiconductors NV (a)(b)		24,210		1,443,400		0.97	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Information Technology (Continued)
Skyworks Solutions, Inc. (a)		33,670	$	1,382,154		0.93	%
TE Connectivity, Ltd. (b)		14,830		874,673		0.59	%
Western Digital Corp.		11,660		1,027,596		0.69	%
				15,628,975		10.50	%

Materials – 3.91%
CF Industries Holdings, Inc.		3,975		974,551		0.65	%
Eastman Chemical Co.		8,505		741,381		0.50	%
Huntsman Corp.		56,165		1,406,933		0.94	%
International Paper Co.		22,295		1,040,062		0.70	%
Newmont Mining Corp.		36,440		904,805		0.61	%
Steel Dynamics, Inc.		41,405		756,469		0.51	%
				5,824,201		3.91	%

Telecommunication Services – 1.57%
AT&T, Inc.		65,580		2,341,206		1.57	%

Utilities – 5.94%
American Electric Power, Inc.		46,075		2,479,296		1.66	%
DTE Energy Co.		33,160		2,591,122		1.74	%
Northeast Utilities		33,340		1,575,649		1.06	%
Sempra Energy		22,305		2,199,496		1.48	%
				8,845,563		5.94	%
Total Common Stocks
(Cost $109,589,901)				143,170,682		96.13	%

REITS – 2.80%
Prologis, Inc.		46,655		1,895,593		1.27	%
Simon Property Group, Inc.		13,103		2,269,440		1.53	%

Total REITS
(Cost $2,908,963)				4,165,033		2.80	%

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

SHORT-TERM INVESTMENTS – 1.05%	Number				% of
	of Shares		Value		Net Assets
Money Market Funds – 1.05%
Fidelity Government Portfolio –
Institutional Class, 0.01% (c)		1,566,474	$	1,566,474		1.05	%

Total Money Market Funds
(Cost $1,566,474)				1,566,474		1.05	%

Total Short-Term Investments
(Cost $1,566,474)				1,566,474		1.05	%

Total Investments
(Cost $114,065,338) – 99.98%				148,902,189		99.98	%
Other Assets in Excess
of Liabilities – 0.02%				26,617		0.02	%
TOTAL NET ASSETS – 100.00%			$	148,928,806		100.00	%

Percentages are stated as a percent of net assets.

(a)	Non-income producing security.
(b)	U.S. traded security of a foreign corporation.
(c)	The rate listed is the fund’s 7-day yield as of April 30, 2014.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	9,507,668	$	—	$	—	$	9,507,668
Consumer Staples		6,273,368		—		—		6,273,368
Energy		22,759,764		—		—		22,759,764
Financials		36,119,115		—		—		36,119,115
Health Care		19,650,355		—		—		19,650,355
Industrials		16,220,467		—		—		16,220,467
Information Technology		15,628,975		—		—		15,628,975
Materials		5,824,201		—		—		5,824,201
Telecommunication Services		2,341,206		—		—		2,341,206
Utilities		8,845,563		—		—		8,845,563
Total Common Stock	$	143,170,682	$	—	$	—	$	143,170,682
REITS
Financials	$	4,165,033	$	—	$	—	$	4,165,033
Total REITS	$	4,165,033	$	—	$	—	$	4,165,033
Short-Term Investments
Money Market Funds	$	1,566,474	$	—	$	—	$	1,566,474
Total Short-Term Investments	$	1,566,474	$	—	$	—	$	1,566,474
Total Investments	$	148,902,189	$	—	$	—	$	148,902,189

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized no transfers between levels.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $114,065,338)	$	148,902,189
Dividends and interest receivable		129,708
Receivable for fund shares sold		14,292
Receivable for securities sold		1,330,046
Prepaid expenses and other assets		21,264
Total Assets		150,397,499

LIABILITIES:
Payable for securities purchased		1,197,634
Payable for fund shares redeemed		60,856
Payable to advisor		102,790
Payable to administrator		49,682
Payable to auditor		12,333
Accrued service fees		12,064
Accrued trustees fees		4,735
Accrued expenses and other payables		28,599
Total Liabilities		1,468,693
NET ASSETS	$	148,928,806

NET ASSETS CONSIST OF:
Capital stock	$	120,119,400
Accumulated net investment income		309,599
Accumulated net realized loss on investments		(6,337,044	)
Unrealized net appreciation on investments		34,836,851
Total Net Assets	$	148,928,806

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		148,573,208
Shares issued and outstanding		4,534,296
Net asset value, offering price and redemption price per share	$	32.77

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares		355,598
Shares issued and outstanding		10,819
Net asset value, offering price and redemption price per share	$	32.87

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income	$	1,497,577
Interest income		59
Total investment income		1,497,636

EXPENSES:
Investment advisory fees		614,245
Administration, fund accounting, custody and transfer agent fees		144,528
Service fees – Investor Class (See Note 5)		72,092
Sub-transfer agent expenses – Investor Class (See Note 5)		50,465
Sub-transfer agent expenses – Institutional Class (See Note 5)		143
Federal and state registration fees		17,388
Audit fees		10,811
Compliance expense		10,655
Reports to shareholders		9,521
Trustees’ fees and expenses		7,536
Legal fees		2,480
Other expenses		8,239
Total expenses before waiver		948,103
Administration expense waiver (See Note 5)		(422	)
Net expenses		947,681
NET INVESTMENT INCOME	$	549,955

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	6,023,881
Change in unrealized appreciation on investments		4,097,154
Net gain on investments		10,121,035
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	10,670,990

The accompanying notes are an integral part of these financial statements.

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HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment income	$	549,955		$	1,323,440
Net realized gain on securities		6,023,881			17,493,521
Change in unrealized appreciation
on securities		4,097,154			11,896,355
Net increase in net assets resulting
from operations		10,670,990			30,713,316

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Investor Class		(1,140,763	)		(1,437,942	)
Institutional Class		(3,752	)		(921	)
Total distributions		(1,144,515	)		(1,438,863	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed –
Investor Class		770,878			2,715,396
Proceeds from shares subscribed –
Institutional Class		9,484			440,166
Dividends reinvested – Investor Class		1,092,130			1,378,307
Dividends reinvested – Institutional Class		3,353			921
Cost of shares redeemed – Investor Class		(6,278,694	)		(14,868,801	)
Cost of shares redeemed – Institutional Class		(16,114	)		(209,593	)
Net decrease in net assets derived from
capital share transactions		(4,418,963	)		(10,543,604	)
TOTAL INCREASE IN NET ASSETS		5,107,512			18,730,849

NET ASSETS:
Beginning of period		143,821,294			125,090,445
End of period	$	148,928,806		$	143,821,294
Undistributed net investment
income, end of period	$	309,599		$	904,159

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Statements of Changes in Net Assets – Continued

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		24,546			99,185
Shares sold – Institutional Class		295			15,876
Shares issued to holders as reinvestment of dividends –
Investor Class		34,322			55,132
Shares issued to holders as reinvestment of dividends –
Institutional Class		105			37
Shares redeemed – Investor Class		(199,051	)		(538,927	)
Shares redeemed – Institutional Class		(506	)		(7,267	)
Net decrease in shares outstanding		(140,289	)		(375,964	)

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Large Value Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	30.70

Income from investment operations:
Net investment income		0.12
Net realized and unrealized gains (losses) on securities		2.20
Total from investment operations		2.32

Less distributions:
Dividends from net investment income		(0.25	)
Total distributions		(0.25	)
Net asset value, end of period	$	32.77

TOTAL RETURN		7.57	%(3)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	148.57
Ratio of expenses to average net assets:
Before expense reimbursement		1.31	%(4)
After expense reimbursement		1.31	%(4)
Ratio of net investment income to average net assets:
Before expense reimbursement		0.76	%(4)
After expense reimbursement		0.76	%(4)
Portfolio turnover rate(5)		41	%(3)

(1)	For the one month ended October 31, 2009. Effective October 31, 2009, the Fund changed its fiscal year end to October 31 from September 30.
(2)	The financial highlights set forth for periods prior to March 20, 2009 represent the historical financial highlights of the Tamarack Value Fund, Class S shares. The assets of the Tamarack Value Fund were acquired by the Hennessy Large Value (formerly known as Hennessy Select Large Value Fund) Fund on March 20, 2009. Prior to the reorganization, Tamarack Value Fund also offered Class A, Class C and R shares. At that time, RBC Global Asset Management (U.S.) Inc., (formerly known as Voyageur Asset Management Inc.) ceased to be investment advisor and Hennessy Advisors, Inc. became investment advisor. The return of the Tamarack Value Fund, Class S shares during the period October 1, 2008 through March 20, 2009 was (33.09)%. The return of the Hennessy Select Large Value Fund, Original Class shares during the period March 20, 2009 through September 30, 2009 was 36.84%.
(3)	Not annualized.
(4)	Annualized.
(5)	Portfolio turnover is calculated on the basis of the Fund as a whole.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

												One Month Ended				Year Ended
	Year Ended October 31,											October 31,				September 30,
	2013			2012			2011			2010		2009(1)				2009(2)

$	24.71		$	21.47		$	20.57		$	18.88		$	19.49		$	21.80


	0.28			0.28			0.22			0.14			0.01			0.31
	6.00			3.14			0.89			1.78			(0.62	)		(2.21	)
	6.28			3.42			1.11			1.92			(0.61	)		(1.90	)


	(0.29	)		(0.18	)		(0.21	)		(0.23	)		—			(0.41	)
	(0.29	)		(0.18	)		(0.21	)		(0.23	)		—			(0.41	)
$	30.70		$	24.71		$	21.47		$	20.57		$	18.88		$	19.49

	25.64	%		16.07	%		5.36	%		10.22	%		(3.13	)%(3)		(8.43	)%


$	143.48		$	125.00		$	123.97		$	131.54		$	132.77		$	138.34

	1.33	%		1.40	%		1.38	%		1.41	%		1.37	%(4)		1.42	%
	1.33	%		1.40	%		1.38	%		1.38	%		1.30	%(4)		1.17	%

	0.98	%		1.16	%		0.97	%		0.64	%		0.28	%(4)		1.46	%
	0.98	%		1.16	%		0.97	%		0.67	%		0.35	%(4)		1.71	%
	91	%		111	%		149	%		146	%		10	%(3)		142	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Large Value Fund

For an Institutional Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	30.83

Income from investment operations:
Net investment income		0.17
Net realized and unrealized gains (losses) on securities		2.21
Total from investment operations		2.38

Less distributions:
Dividends from net investment income		(0.34	)
Total distributions		(0.34	)
Net asset value, end of period	$	32.87

TOTAL RETURN		7.77	%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	0.36
Ratio of expenses to average net assets:
Before expense reimbursement		1.23	%(5)
After expense reimbursement		0.98	%(5)
Ratio of net investment income to average net assets:
Before expense reimbursement		0.85	%(5)
After expense reimbursement		1.10	%(5)
Portfolio turnover rate(6)		41	%(4)

(1)	For the one month ended October 31, 2009. Effective October 31, 2009, the Fund changed its fiscal year end to October 31 from September 30.
(2)	Institutional Class shares commenced operations on March 20, 2009.
(3)	Amount is less than $0.01 or $(0.01).
(4)	Not annualized.
(5)	Annualized.
(6)	Portfolio turnover is calculated on the basis of the Fund as a whole.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

													One Month Ended			Period Ended
	Year Ended October 31,												October 31,			September 30,
	2013			2012			2011			2010			2009(1)			2009(2)

$	24.83		$	21.56		$	20.65		$	18.92		$	19.53		$	14.25


	0.49			0.39			0.27			0.21			0.00	(3)		0.08
	5.90			3.15			0.92			1.80			(0.61	)		5.20
	6.39			3.54			1.19			2.01			(0.61	)		5.28


	(0.39	)		(0.27	)		(0.28	)		(0.28	)		—			—
	(0.39	)		(0.27	)		(0.28	)		(0.28	)		—			—
$	30.83		$	24.83		$	21.56		$	20.65		$	18.92		$	19.53

	26.08	%		16.58	%		5.76	%		10.65	%		(3.12	)%(4)		37.05	%(4)


$	0.34		$	0.06		$	0.04		$	0.04		$	0.03		$	0.03

	1.14	%		1.22	%		1.21	%		1.22	%		1.20	%(5)		26.18	%(5)
	0.98	%		0.98	%		0.98	%		0.98	%		0.98	%(5)		0.98	%(5)

	1.07	%		1.29	%		1.13	%		0.80	%		0.44	%(5)		(24.06	)%(5)
	1.23	%		1.53	%		1.36	%		1.04	%		0.66	%(5)		1.14	%(5)
	91	%		111	%		149	%		146	%		10	%(4)		142	%(4)

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Large Value Fund (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The investment objective of the Fund is long-term growth of capital and current income. The Fund is a diversified fund.

2). SIGNIFICANT ACCOUNTING POLICIES

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis. The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its respective net assets.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out annually, usually in November or December. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the trade date. The Fund determines the gain or loss realized from the investment

HENNESSYFUNDS.COM

	transactions by comparing the original cost of the security lot sold with the net sale proceeds. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies, if any, are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.
	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions and concluded that there is no impact on the Fund’s net assets and no tax liability

HENNESSY FUNDS 1-800-966-4354

	resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

	Level 1 –	Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.
	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.
	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

HENNESSYFUNDS.COM

Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

HENNESSY FUNDS 1-800-966-4354

determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price foreign securities may result in a value that is different from a foreign security’s most recent closing price and from the prices used by other investment companies to calculate their net asset values and are generally considered Level 2 prices in the fair valuation hierarchy. Because the Fund may invest in foreign securities, the value of the Fund’s portfolio securities may change on days when you will not be able to purchase or redeem your shares.

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $59,934,480 and $65,361,497, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund during the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Hennessy Advisors, Inc. (the “Advisor”) is the investment advisor of the Fund. The Advisor provides the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnishes 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 from the Fund. The fee is based upon the average daily net assets of the Fund at the annual rate of 0.85%. The net investment advisory fees payable for the Fund as of April 30, 2014 were $102,790.

The Advisor has delegated the day-to-day management of the Fund to a sub-advisor, RBC Global Asset Management (U.S.) Inc. The Advisor pays the sub-advisor fees for the Fund from its own assets and these fees are not an additional expense of the Fund.

HENNESSYFUNDS.COM

The Board has approved a Shareholder Servicing Agreement for Investor Class shares of the Fund, which was instituted to compensate the Advisor for the non-investment management services it provides to the Fund. The Shareholder Servicing Agreement provides for a monthly fee paid to the Advisor at an annual rate of 0.10% of the average daily net assets of the Fund attributable to Investor Class shares. Shareholder servicing fees payable for the Fund as of April 30, 2014 were $12,064.

6). LINE OF CREDIT

HENNESSY FUNDS 1-800-966-4354

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	114,439,789
Gross tax unrealized appreciation	$	31,694,757
Gross tax unrealized depreciation		(1,266,680	)
Net tax unrealized appreciation/depreciation	$	30,428,077
Undistributed ordinary income	$	904,159
Undistributed long-term capital gains		—
Total distributable earnings	$	904,159
Other accumulated gain (loss)	$	(12,049,305	)
Total accumulated gain (loss)	$	19,282,931

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had capital loss carryforwards that expire as follows:

$12,049,003

10/31/17

During the year ended October 31, 2013, the Fund’s most recent fiscal year end, the capital loss carry forwards utilized for the Fund were $17,419,429.

At October 31, 2013, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals or post-December loss deferrals.

The tax character of distributions paid during fiscal year 2014 (year-to-date) and fiscal year 2013 for the Fund were as follows:

	Six Months Ended		Year Ended
	April 30, 2014		October 31, 2013
Ordinary income	$	1,144,515	$	1,438,863
Long-term capital gain		—		—
	$	1,144,515	$	1,438,863

HENNESSYFUNDS.COM

Expense Example (Unaudited)

April 30, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$1,075.70	$6.74

Hypothetical (5% return
before expenses)	$1,000.00	$1,018.30	$6.56

Institutional Class

Actual	$1,000.00	$1,077.70	$5.05

Hypothetical (5% return
before expenses)	$1,000.00	$1,019.93	$4.91

(1)	Expenses are equal to the Fund’s annualized expense ratio of 1.31% for Investor Class shares or 0.98% for Institutional Class shares, as applicable, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

HENNESSYFUNDS.COM

Proxy Voting

Quarterly Filings on Form N-Q

Federal Tax Distribution Information

(Unaudited)

For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the fiscal year ended October 31, 2013 was 100.00%.

Householding

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreements

At its meeting on March 3, 2014, the Board of Trustees of the Fund (the “Board”) unanimously approved the continuation of the investment advisory agreement and sub-advisory agreement of the Fund.

The Board reviewed a number of documents, including a memorandum provided by outside legal counsel that described the fiduciary duties of the Board with respect to approving the continuance of the investment advisory and sub-advisory agreements and the relevant factors for consideration, a memorandum from the Advisor that listed each of the relevant factors and the documents provided to help the Board assess each such factor, the Advisor’s most recent Form 10-K and 10-Q, the Advisor’s Form ADV Part I, a document that listed the range of services provided by the Advisor for the Fund, a written discussion of economies of scale, a completed questionnaire from the sub-advisor, the sub-advisor’s Form ADV Parts I and II, copies of the advisory and sub-advisory agreements, a fund fact sheet, and peer expense and performance comparisons. The Board considered and discussed numerous factors, including the following:

•

The Board considered the services identified below that are provided by the Advisor and the sub-advisor:

		•	The Advisor oversees the sub-advisor for the Fund. The sub-advisor acts as the portfolio manager to the Fund, managing the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
		•	The Advisor performs daily reconciliations of portfolio positions and cash for the Fund.
		•	The Advisor oversees the use of soft dollars for the Fund.
		•	The Advisor monitors compliance by the Fund with its investment objectives and restrictions.
		•	The Advisor monitors compliance with federal securities laws and performs activities such as maintaining a compliance program, conducting ongoing reviews of the compliance programs of the sub-advisor and the Fund’s other service providers, conducting on-site visits to the sub-advisor and the Fund’s other service providers, monitoring incidents of abusive trading practices, reviewing Fund expense accruals, payments, and fixed expense ratios, evaluating insurance providers for fidelity bond coverage and D&O/E&O insurance coverage, conducting employee compliance training, reviewing reports provided by service providers, maintaining books and records, and preparing an annual compliance report to the Board.
		•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, custodial, sales and marketing, audit, information technology, and legal services.
		•	The Advisor maintains an in-house public relations and marketing department on behalf of the Fund.
		•	The Advisor is actively involved with preparing regulatory filings for the Fund.
		•	The Advisor oversees proxy voting for the Fund.
		•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab,

HENNESSYFUNDS.COM

			Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund, which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
		•	The Advisor pays the incentive compensation of all of the Fund’s compliance officers and employs other staff such as management executives, legal personnel, marketing personnel, national accounts and distribution personnel, sales personnel, and trading oversight personnel.
		•	The Advisor prepares or reviews Board materials, frequently presents to the Board or leads Board discussions, prepares or reviews meeting minutes, and arranges for Board training and education.

	•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the continuation of the advisory and sub-advisory agreements.
	•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
	•	The Board considered the fees charged by the Advisor and the sub-advisor of the Fund to those of funds similar in asset size and investment objective to the Fund and concluded the advisory and sub-advisory fees of the Fund were reasonable and warranted continuation of the advisory and sub-advisory agreements. The Trustees noted that the investment advisory and sub-advisory fees are not adjusted if economies of scale are realized as the Fund grows because many of the expenses incurred to manage the Fund are asset-based fees and thus do not result in material economies of scale being realized as the net assets of the Fund increase.
	•	The Board considered the profitability of the Advisor and the sub-advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
	•	The Board considered the high level of professionalism and knowledge of the Advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

All of the factors above were considered separately by the Board, including the Trustees who are not “interested persons” (as defined in the Investment Company Act of 1940, as amended) of the Fund (the “Independent Trustees”) meeting in an executive session. The factors were viewed in their totality by the Board, with no single factor being the principal or determinative factor in the Board’s determination of whether to approve the continuation of the advisory and sub-advisory agreements. Based on the factors discussed above, the Board, including all of the Independent Trustees, recommended continuation of the advisory and sub-advisory agreements.

HENNESSY FUNDS 1-800-966-4354

For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

KPMG LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY BALANCED

FUND

Investor Class HBFBX

hennessyfunds.com | 1-800-966-4354

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Contents

Letter to Shareholders		2
Performance Overview		4
Financial Statements
Schedule of Investments		6
Statement of Assets and Liabilities		10
Statement of Operations		11
Statements of Changes in Net Assets		13
Financial Highlights		14
Notes to the Financial Statements		16
Expense Example		23
Proxy Voting		25
Quarterly Filings on Form N-Q		25
Federal Tax Distribution Information		25
Householding		25
Board Approval of Investment Advisory Agreement		26

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

HENNESSYFUNDS.COM

Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Dow Jones Industrial Average and S&P 500 are unmanaged indices commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014

	Six	One	Five	Ten
	Months(1)	Year	Years	Years
Hennessy Balanced Fund (HBFBX)	3.22%	4.93%	10.22%	3.89%
50/50 Blended DJIA/Treasury Index(2)	4.04%	7.28%	9.30%	5.09%
Dow Jones Industrial Average	7.90%	14.44%	18.32%	7.68%

Expense ratio: 1.75%

The expense ratio presented is from the most recent prospectus.

(1)	Periods less than one year are not annualized.

(2)	The 50/50 Blended DJIA/Treasury Index consists of 50% common stocks represented by the Dow Jones Industrial Average and 50% short-duration Treasury securities represented by the BofA Merrill Lynch 1-Year Treasury Note Index.

PERFORMANCE NARRATIVE

Portfolio Manager, Neil Hennessy, and Co-Portfolio Manager, Brian Peery

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Hennessy Balanced Fund returned 3.22%, underperforming the 50/50 Blended DJIA/Treasury Index, the Dow Jones Industrial Average, and the Morningstar Moderate Allocation Category Average, which returned 4.04%, 7.90%, and 4.65% for the same period, respectively.

The Fund’s relative underperformance to its benchmarks is due primarily to the relative underperformance of some of the higher dividend-paying companies within the Dow Jones Industrial Average. Because the Fund maintains a position of approximately 50% in U.S. Treasuries, it did not fully capture the performance of the equity markets over the six-month period. While the Fund’s portfolio may underperform its benchmarks in periods where equities rise sharply, the strategy aims to capture near-market returns with a lower risk profile, since only approximately 50% of the assets of the Fund are invested in equities. Conversely, if equity markets were to fall sharply, we would expect the Fund to perform better than its equity benchmarks due to its approximately 50% exposure to short-term U.S. Treasuries that are held to maturity. Ultimately, the overall goal of this portfolio is to capture upside performance while mitigating downside risk.

HENNESSYFUNDS.COM

During the six-month period ended April 30, 2014, all but one of the Fund’s 13 equity positions had positive returns, with only Verizon Communications, Inc. posting a negative return. Merck & Co., Inc. and Microsoft Corporation had the best performance during the period, posting gains of 31% and 15%, respectively. Despite Merck & Co., Inc. being the largest holding within the Fund, the Fund’s relative underweight position in Microsoft Corporation and overweight position in both Verizon Communications, Inc. and AT&T, Inc. hurt relative overall performance versus its benchmarks. The Fund continues to hold all of these positions.

Additional Portfolio Manager commentary and related investment outlook:

We continue to believe that the Dow Jones Industrial Average stocks, and in particular the stocks comprising the high dividend- yielding “Dogs of the Dow” (the methodology employed within the Hennessy Balanced Fund), provide an excellent way to gain equity exposure to the markets. With U.S. Treasury yields still trading near historic lows, many investors are seeking high quality, dividend- paying companies as a means of potentially generating current income. We believe that the rotation out of bonds and into equities, where investors have historically received higher yields as well as the potential for capital appreciation, should continue.

As the overall markets reach new highs and investors become more wary of a potential pullback, we believe that a trend of moving some money away from more risky asset classes and into the perceived “safety” of very large dividend-paying companies will prevail. We believe the Fund is well positioned for the more conservative investor as the equity portion of the portfolio holds what we would deem to be high quality, high-dividend-paying companies, while the relatively short duration of the U.S. Treasury component (all less than one year) will allow us the ability to roll into higher yielding treasuries in the event yields continue to rise.

_______________

The 50/50 Blended DJIA/Treasury Index consists of 50% common stocks represented by the Dow Jones Industrial Average and 50% short duration Treasury securities represented by the BofA Merrill Lynch 1-Year U.S. Treasury Note Index. The Dow Jones Industrial Average is an unmanaged index commonly used to measure the performance of U.S. stocks. The BofA Merrill Lynch 1-Year U.S. Treasury Note Index is an unmanaged index comprised of Treasury securities maturing in approximately one year. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund is non-diversified, meaning it concentrates its assets in fewer individual holdings than a diversified fund and is therefore more exposed to individual stock volatility than a diversified fund. The Fund’s portfolio is rebalanced annually in accordance with its strategy, which may result in the elimination of better performing assets from the Fund’s investments and increases in investments with relatively lower total return. References to specific securities should not be considered a recommendation to buy or sell any security. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

HENNESSY FUNDS 1-800-966-4354

Schedule of Investments

HENNESSY BALANCED FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS	% NET ASSETS
	U.S. Treasury Bill, 0.115%, 02/05/2015	12.56%
	U.S. Treasury Bill, 0.075%, 08/21/2014	8.37%
	U.S. Treasury Bill, 0.080%, 09/18/2014	6.70%
	U.S. Treasury Bill, 0.050%, 06/26/2014	6.70%
	Merck & Co., Inc.	5.74%
	Intel Corp.	5.26%
	General Electric Co.	5.07%
	Procter & Gamble Co.	5.05%
	U.S. Treasury Bill, 0.010%, 05/29/2014	5.02%
	McDonald’s Corp.	4.92%

HENNESSYFUNDS.COM

COMMON STOCKS – 50.30%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 4.92%
McDonald’s Corp.		5,800	$	588,004		4.92	%

Consumer Staples – 5.05%
Procter & Gamble Co.		7,300		602,615		5.05	%

Energy – 4.89%
Chevron Corp.		4,650		583,668		4.89	%

Health Care – 10.26%
Merck & Co., Inc.		11,700		685,152		5.74	%
Pfizer, Inc.		17,250		539,580		4.52	%
				1,224,732		10.26	%

Industrials – 5.07%
General Electric Co.		22,500		605,025		5.07	%

Information Technology – 6.52%
Cisco Systems, Inc.		4,850		112,084		0.94	%
Intel Corp.		23,550		628,549		5.26	%
Microsoft Corp.		950		38,380		0.32	%
				779,013		6.52	%

Materials – 4.51%
EI Du Pont de Nemours & Co.		8,000		538,560		4.51	%

Telecommunication Services – 9.08%
AT&T, Inc.		16,450		587,265		4.92	%
Verizon Communications, Inc.		10,650		497,675		4.16	%
				1,084,940		9.08	%
Total Common Stocks
(Cost $4,880,427)				6,006,557		50.30	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

SHORT-TERM INVESTMENTS – 49.85%	Number of Shares/					% of
	Par Amount		Value			Net Assets
Money Market Funds – 1.30%
Fidelity Government Portfolio –
Institutional Class, 0.01% (a)		154,803	$	154,803			1.30	%

Total Money Market Funds
(Cost $154,803)				154,803			1.30	%

U.S. Treasury Bills – 48.55%
0.020%, 05/01/2014 (b)		300,000		300,000			2.51	%
0.010%, 05/29/2014 (b)		600,000		599,951			5.02	%
0.050%, 06/26/2014 (b)		800,000		799,832			6.70	%
0.075%, 08/21/2014 (b)		1,000,000		999,918			8.37	%
0.080%, 09/18/2014 (b)		800,000		799,914			6.70	%
0.115%, 02/05/2015 (b)		1,500,000		1,499,212			12.56	%
0.120%, 03/05/2015 (b)		300,000		299,795			2.51	%
0.125%, 04/02/2015 (b)		500,000		499,627			4.18	%

Total U.S. Treasury Bills
(Cost $5,797,262)				5,798,249			48.55	%

Total Short-Term Investments
(Cost $5,952,065)				5,953,052			49.85	%

Total Investments
(Cost $10,832,492) – 100.15%				11,959,609			100.15	%
Liabilities in Excess of
Other Assets – (0.15)%				(18,304	)		(0.15	)%
TOTAL NET ASSETS – 100.00%			$	11,941,305			100.00	%

Percentages are stated as a percent of net assets.

(a)	The rate listed is the fund’s 7-day yield as of April 30, 2014.

(b)	The rate listed is discount rate at issue.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	588,004	$	—	$	—	$	588,004
Consumer Staples		602,615		—		—		602,615
Energy		583,668		—		—		583,668
Health Care		1,224,732		—		—		1,224,732
Industrials		605,025		—		—		605,025
Information Technology		779,013		—		—		779,013
Materials		538,560		—		—		538,560
Telecommunication Services		1,084,940		—		—		1,084,940
Total Common Stock	$	6,006,557	$	—	$	—	$	6,006,557
Short-Term Investments
Money Market Funds	$	154,803	$	—	$	—	$	154,803
U.S. Treasury Bills		—		5,798,249		—		5,798,249
Total Short-Term Investments	$	154,803	$	5,798,249	$	—	$	5,953,052
Total Investments	$	6,161,360	$	5,798,249	$	—	$	11,959,609

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized no transfers between levels.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $10,832,492)	$	11,959,609
Dividends and interest receivable		18,819
Receivable for fund shares sold		123
Prepaid expenses and other assets		13,804
Total Assets		11,992,355

LIABILITIES:
Payable to advisor		5,859
Payable to administrator		4,442
Payable to auditor		11,444
Accrued distribution fees		15,130
Accrued service fees		978
Accrued trustees fees		3,186
Accrued expenses and other payables		10,011
Total Liabilities		51,050
NET ASSETS	$	11,941,305

NET ASSETS CONSIST OF:
Capital stock	$	10,622,229
Accumulated net investment income		1,734
Accumulated net realized gain on investments		190,225
Unrealized net appreciation on investments		1,127,117
Total Net Assets	$	11,941,305

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		11,941,305
Shares issued and outstanding		928,839
Net asset value, offering price and redemption price per share	$	12.86

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income	$	113,050
Interest income		2,769
Total investment income		115,819

EXPENSES:
Investment advisory fees		35,733
Administration, fund accounting, custody and transfer agent fees		11,911
Federal and state registration fees		11,808
Compliance expense		10,655
Audit fees		9,421
Distribution fees – Investor Class (See Note 5)		8,933
Service fees – Investor Class (See Note 5)		5,955
Trustees’ fees and expenses		4,563
Sub-transfer agent expenses – Investor Class (See Note 5)		4,475
Legal fees		2,480
Reports to shareholders		1,761
Other expenses		3,181
Total expenses		110,876
NET INVESTMENT INCOME	$	4,943

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	199,797
Change in unrealized appreciation on investments		168,580
Net gain on investments		368,377
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	373,320

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

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HENNESSYFUNDS.COM

Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment income	$	4,943		$	19,673
Net realized gain on securities		199,797			1,673,842
Change in unrealized appreciation on securities		168,580			(684,183	)
Net increase in net assets resulting from operations		373,320			1,009,332

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Investor Class		(3,209	)		(23,090	)
Net realized gains
Investor Class		(413,659	)		—
Total distributions		(416,868	)		(23,090	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		263,261			1,014,696
Dividends reinvested – Investor Class		404,904			21,766
Cost of shares redeemed – Investor Class		(893,886	)		(14,981,906	)
Net decrease in net assets derived
from capital share transactions		(225,721	)		(13,945,444	)
TOTAL DECREASE IN NET ASSETS		(269,269	)		(12,959,202	)

NET ASSETS:
Beginning of period		12,210,574			25,169,776
End of period	$	11,941,305		$	12,210,574
Undistributed net investment income, end of period	$	1,734		$	—

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		20,904			82,345
Shares issued to holders as reinvestment of dividends –
Investor Class		32,209			1,841
Shares redeemed – Investor Class		(70,561	)		(1,256,293	)
Net decrease in shares outstanding		(17,448	)		(1,172,107	)

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Balanced Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	12.90

Income from investment operations:
Net investment income		0.00	(3)
Net realized and unrealized gains on securities		0.40
Total from investment operations		0.40

Less distributions:
Dividends from net investment income		0.00	(3)
Dividends from realized capital gains		(0.44	)
Total distributions		(0.44	)
Net asset value, end of period	$	12.86

TOTAL RETURN		3.22	%(1)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	11.94
Ratio of net expenses to average net assets		1.86	%(2)
Ratio of net investment income to average net assets		0.08	%(2)
Portfolio turnover rate		2	%(1)

(1)	Not annualized.

(2)	Annualized.

(3)	Amount is less than $0.01 or $(0.01).

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Year Ended October 31,
2013			2012			2011			2010			2009

$	11.88		$	11.13		$	10.43		$	9.48		$	9.11


	0.02			0.04			0.05			0.05			0.10
	1.02			0.75			0.70			0.95			0.38
	1.04			0.79			0.75			1.00			0.48

	(0.02	)		(0.04	)		(0.05	)		(0.05	)		(0.11	)
	—			—			—			—			—
	(0.02	)		(0.04	)		(0.05	)		(0.05	)		(0.11	)
$	12.90		$	11.88		$	11.13		$	10.43		$	9.48

	8.77	%		7.13	%		7.16	%		10.53	%		5.46	%


$	12.21		$	25.17		$	18.02		$	12.50		$	11.47
	1.75	%		1.54	%		1.61	%		1.65	%		1.73	%
	0.14	%		0.34	%		0.42	%		0.45	%		1.17	%
	22	%		17	%		39	%		57	%		46	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Balanced Fund (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund is a successor to a fund with the same name (the “Predecessor Fund”) that was a series of The Hennessy Funds, Inc., a Maryland corporation, pursuant to a reorganization that took place after the close of business on February 28, 2014. Prior to February 28, 2014, the Fund had no investment operations. As a result of the reorganization, holders of the Investor Class shares of the Predecessor Fund received Investor Class shares of the Fund (the Investor Class shares of the Fund are the successor to the accounting and performance information of the Predecessor Fund). The investment objective of the Fund is a combination of capital appreciation and current income. The Fund is a non-diversified fund.

The Fund offers Investor Class shares. Prior to October 26, 2012, the Investor Class shares were known as Original Class shares.

2). SIGNIFICANT ACCOUNTING POLICIES

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis. The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out on a calendar quarter basis. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the trade date. The Fund determines the gain or loss realized from the investment

HENNESSYFUNDS.COM

	transactions by comparing the original cost of the security lot sold with the net sale proceeds. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies, if any, are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.
	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions and concluded that there is no impact on the Fund’s net assets and no tax liability

HENNESSY FUNDS 1-800-966-4354

	resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

	Level 1 –	Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.
	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.
	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

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Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

HENNESSY FUNDS 1-800-966-4354

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $152,132 and $805,900, respectively.

Purchases and sales/maturities of long-term U.S. Government Securities for the Fund were $0 and $2,000,000, respectively, during the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Hennessy Advisors, Inc. (the “Advisor”) is the investment advisor of the Fund. The Advisor provides the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnishes 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 from the Fund. The fee is based upon the average daily net assets of the Fund at the annual rate of 0.60%. The net investment advisory fees payable for the Fund as of April 30, 2014 were $5,859.

The Board has approved a Shareholder Servicing Agreement for the Fund, which was instituted to compensate the Advisor for the non-investment management services it provides to the Fund. The Shareholder Servicing Agreement provides for a monthly fee paid to the Advisor at an annual rate of 0.10% of the average daily net assets of the Fund. Shareholder servicing fees payable for the Fund as of April 30, 2014 were $978.

The Fund has adopted a plan pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended, that authorizes payments in connection with the distribution of the Fund’s shares at an annual rate of up to 0.15% of the Fund’s average daily net assets. Amounts paid under the plan may be spent on any activities or expenses primarily intended to result in the sale of shares, including but not limited to, advertising, compensation for sales and marketing activities or financial institutions and others such as dealers and distributors, shareholder account servicing, the printing and mailing of prospectuses to other than current shareowners, and the printing and mailing of sales literature.

The Fund has entered into agreements with various brokers, dealers, and financial intermediaries in connection with the sale of shares of the Fund. The agreements provide

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for periodic payments by the Fund to the brokers, dealers, and financial intermediaries for providing certain shareholder maintenance services (sub-transfer agent expenses). These shareholder services include the pre-processing and quality control of new accounts, shareholder correspondence, answering customer inquiries regarding account status, and facilitating shareholder telephone transactions. Fees paid by the Fund to various brokers, dealers, and financial intermediaries for the six months ended April 30, 2014 were $4,475.

6). LINE OF CREDIT

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	11,290,839
Gross tax unrealized appreciation	$	970,611
Gross tax unrealized depreciation		(21,637	)
Net tax unrealized appreciation/depreciation	$	948,974
Undistributed ordinary income	$	—
Undistributed long-term capital gains		413,650
Total distributable earnings	$	413,650
Other accumulated gain (loss)	$	—
Total accumulated gain (loss)	$	1,362,624

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had no tax basis capital losses to offset future capital gains.

During the year ended October 31, 2013, the Fund’s most recent fiscal year end, the capital loss carry forwards utilized for the Fund were $1,233,401.

HENNESSY FUNDS 1-800-966-4354

At October 31, 2013, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals or post-December loss deferrals.

The tax character of distributions paid during fiscal year 2014 (year-to-date) and fiscal year 2013 for the Fund were as follows:

	Six Months Ended		Year Ended
	April 30, 2014		October 31, 2013
Ordinary income	$	3,209	$	22,605
Long-term capital gain		413,659		485
	$	416,868	$	23,090

8). AGREEMENT AND PLAN OF REORGANIZATION

On December 11, 2013, the Board approved an Agreement and Plan of Reorganization (the “Agreement”), of the Hennessy Balanced Fund (the “New Fund”), pursuant to which the New Fund would be a successor to the corresponding series of the same name of The Hennessy Funds, Inc., a Maryland corporation (the “Predecessor Fund”). The Agreement provided for the transfer of assets of the Predecessor Fund to the New Fund and the assumption of the liabilities of the Predecessor Fund by the New Fund. The New Fund had the same investment objective and substantially similar principal investment strategies as the Predecessor Fund. The reorganization was effective as of the close of business on February 28, 2014. The following table illustrates the specifics of the reorganization:

	Shares of the New Fund
Predecessor Fund	Issued to Shareholders of	New Fund	Combined	Tax Status
Net Assets	the Predecessor Fund	Net Assets	Net Assets	of Transfer
$11,886,699(1)	945,038	$11,886,699	$11,886,699	Non-taxable

(1)

Included accumulated realized gains and unrealized appreciation in the amounts of $426,205 and $1,031,787, respectively.

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Expense Example (Unaudited)

April 30, 2014

Actual Expenses

The first line of the table below provides information about actual account values and actual expenses. Although the Fund charges no sales loads or transaction fees, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent. If you request that a redemption be made by wire transfer, currently a $15.00 fee is charged by the Fund’s transfer agent. IRA accounts will be charged a $15.00 annual maintenance fee. The example below includes, but is not limited to, management fees, shareholder servicing fees, fund accounting, custody, and transfer agent fees. However, the example below does not include portfolio trading commissions and related expenses, and other extraordinary expenses as determined under generally accepted accounting principles. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line of the table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$1,032.20	$9.37

Hypothetical (5% return
before expenses)	$1,000.00	$1,015.57	$9.30

(1)	Expenses are equal to the Fund’s annualized expense ratio of 1.86%, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

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Proxy Voting

Quarterly Filings on Form N-Q

Federal Tax Distribution Information

(Unaudited)

For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the fiscal year ended October 31, 2013 was 100.00%.

Householding

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreement

At its meeting on December 4, 2013, the Board of Trustees of the Fund (the “Board”) unanimously approved the investment advisory agreement of the Fund for an initial period of two years.

The Board reviewed a number of documents, including a memorandum provided by outside legal counsel that described the fiduciary duties of the Board with respect to approving the investment advisory agreement and the relevant factors for consideration, the Advisor’s most recent Form 10-K, a copy of the advisory agreement, a fund fact sheet, and peer expense and performance comparisons. The Board considered and discussed numerous factors, including the following:

•

The Board considered the services identified below that are provided by the Advisor:

		•	The Advisor acts as portfolio manager for the Fund. In this capacity, the Advisor manages the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
		•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab, Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund, which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
		•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, and custodial services.

	•	The Board considered that the advisory services to be provided by the Advisor are services required for the operation of the Fund.
	•	The Board considered the nature and quality of the advisory services offered by the Advisor to the Fund.
	•	The Board considered that the terms of the advisory agreement are fair and reasonable.
	•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the approval of the advisory agreement.
	•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
	•	The Board considered the fees charged by the Advisor to those of funds similar in asset size and investment objective to the Fund and concluded the advisory fee of the Fund was reasonable and warranted approval of the advisory agreement.

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	•	The Board considered the profitability of the Advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
	•	The Board considered the high level of professionalism and knowledge of the Advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

All of the factors above were considered separately by the Board, including the Trustees who are not “interested persons” (as defined in the Investment Company Act of 1940, as amended) of the Fund (the “Independent Trustees”) meeting in an executive session. The factors were viewed in their totality by the Board, with no single factor being the principal or determinative factor in the Board’s determination of whether to approve the advisory agreement. Based on the factors discussed above, the Board, including all of the Independent Trustees, recommended approval of the advisory agreement.

HENNESSY FUNDS 1-800-966-4354

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For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

KPMG LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY GAS UTILITY

INDEX FUND

Investor Class GASFX

hennessyfunds.com | 1-800-966-4354

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Contents

Letter to Shareholders	2
Performance Overview	4
Financial Statements
Schedule of Investments	7
Statement of Assets and Liabilities	12
Statement of Operations	13
Statements of Changes in Net Assets	15
Financial Highlights	16
Notes to the Financial Statements	18
Expense Example	25
Proxy Voting	27
Quarterly Filings on Form N-Q	27
Federal Tax Distribution Information	27
Householding	27
Board Approval of Investment Advisory Agreement	28

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

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Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Dow Jones Industrial Average and S&P 500 are unmanaged indices commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014

	Six	One	Five	Ten
	Months(1)	Year	Years	Years
Hennessy Gas Utility
Index Fund (GASFX)	13.49%	17.14%	22.92%	13.68%
AGA Stock Index(2)	13.35%	17.19%	21.86%	12.57%
S&P 500 Index	8.36%	20.44%	19.14%	7.67%

Expense ratio: 0.80%

The expense ratio presented is from the most recent prospectus.

(1)	Periods less than one year are not annualized.
(2)	Source: American Gas Association. As calculated by the American Gas Association, the total return of the AGA Stock Index reflects the appreciation or depreciation of the stocks in the AGA Stock Index plus all dividends paid on such stocks, but does not assume that the dividends are reinvested and compounded.

PERFORMANCE NARRATIVE

Portfolio Manager, Winsor H. Aylesworth, and Co-Portfolio Manager, Ryan Kelley

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Hennessy Gas Utility Index Fund returned 13.49%, outperforming the American Gas Association (AGA) Stock Index, the S&P 500 Index, and the Morningstar Utilities Category Average, which returned 13.35%, 8.36%, and 10.71% for the same period, respectively.

Two of the Fund’s best performers for the period were Cheniere Energy, Inc. and Energy Transfer Equity, L.P., which returned 42% and 39%, respectively. These two companies were also last year’s top performers. Cheniere Energy, Inc. focuses on Liquid Natural Gas (LNG) and owns ports along the Gulf Coast that can receive and process imports and is currently constructing LNG export facilities. It is the first company to be granted a license to export LNG. Actual shipments are expected to begin in early 2016. Energy Transfer Equity, L.P. is a Master Limited Partnership (MLP) that specializes in the storage and transportation of natural gas. It too has been granted a license to export LNG and has benefited from the interest in this new demand driver for the industry. As an MLP, the company pays the bulk of its cash flow out in distributions to avoid paying taxes

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at the corporate level, which makes it particularly attractive to income-oriented investors. Both Cheniere Energy, Inc. and Energy Transfer Equity, L.P. continued to be two of the Fund’s largest holdings for the six-month period and thus their individual success added greatly to the success of the Fund.

Two holdings that detracted from the Fund’s performance were WGL Holdings Corp. and Kinder Morgan, Inc., which returned -10% and -5%, respectively. WGL Holdings Corp. is a Washington, D.C.-based utility that offers diversified energy solutions throughout the mid-Atlantic region. The stock was impacted by disappointing fourth quarter earnings as the firm continues to diversify from a local distribution company to a provider of more diversified energy sources, including solar, wind, pipelines and storage. As its new business initiatives develop, we anticipate that the stock price should recover. The combined entities of Kinder Morgan form one of the largest pipeline owners in the country. The entity owned by the Fund acts as the general partner to Kinder Morgan’s many MLPs. The stock’s performance has been hindered as growth has been below the industry average. However, as a major player in the industry, we would expect Kinder Morgan, Inc. to grow with the industry in the future.

There were two additions and one deletion to the AGA Stock Index, and thus the Fund’s portfolio, during the six-month period. Additions included One Gas, Inc., an Oklahoma-based natural gas distribution company that was spun off from ONEOK Inc., and Plains GP Holdings, L.P., the general partner to various MLPs that are engaged in the transportation, storage, and terminal line of natural gas liquids and natural gas in both Canada and the United States. The one stock deleted was a result of an acquisition of an AGA member company, NV Energy, by a Canadian utility, Fortis, Inc. NV Energy was a Nevada-based utility while Fortis, Inc. is a large electric and natural gas distribution utility based in British Columbia. Although an AGA member company, Fortis, Inc. does not trade on an American exchange and hence is not a part of the AGA Stock Index. To be included in the AGA Stock Index, a company must be publicly traded on an American stock exchange and be a dues-paying member of the AGA.

Additional Portfolio Manager commentary and related investment outlook:

Investors’ expectations for the Fund should be for the Fund to match the returns of the AGA Stock Index minus the expenses of the Fund. For this six-month period, the Fund exceeded that general expectation. The Fund also continued to outperform its peer group of Utility funds as measured by Morningstar, as well as the overall market as measured by the S&P 500 Index. Thus, by most measures it was a very strong period. The Fund continues to benefit from its focus on the distribution part of the natural gas industry. In addition, the Fund’s performance for the period was helped by a colder than normal winter season, which resulted in record consumption of natural gas used for heating purposes. Finally, the Fund’s portfolio continues to be the beneficiary of the expanded role that natural gas plays in our nation’s energy needs.

The overall outlook for the natural gas distribution industry, which is the basis of the Fund, continues to be strong. With renewed concern about global warming, there is the need to replace coal as the fuel for electricity generation. Natural gas offers a solution that is environmentally friendly, with a supply that is readily available, with stable pricing. This bodes well for the companies in the Fund’s portfolio. Again, we thank you for your investor support.

HENNESSY FUNDS 1-800-966-4354

Performance for the AGA Stock Index is provided by the American Gas Association. As calculated by the American Gas Association, the total return of the AGA Stock Index reflects the appreciation or depreciation of the stocks in the AGA Stock Index plus all dividends paid on such stocks, but does not assume that the dividends are reinvested and compounded.

The AGA Stock Index is a market capitalization-weighted index, adjusted monthly, consisting of member companies of the AGA. The S&P 500 Index is an unmanaged index commonly used to measure the performance of U.S. stocks. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund is non-diversified, meaning it concentrates its assets in fewer holdings than a diversified fund and is therefore more exposed to individual stock volatility than a diversified fund. Investments are focused in the natural gas distribution and transmission industry, which may be adversely affected by rising interest rates, weather, and the wholesale pricing of alternative fuels. Investments in foreign securities may involve greater volatility and political, economic and currency risk and differences in accounting methods. While the Fund seeks to track the performance of the AGA Stock Index as closely as possible, the Fund’s return may not always be able to match or achieve a high correlation with the return of the AGA Stock Index. References to specific securities should not be considered a recommendation to buy or sell any security. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

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Schedule of Investments

HENNESSY GAS UTILITY INDEX FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Cheniere Energy, Inc.	5.01%
	Spectra Energy Corp.	4.94%
	Sempra Energy	4.93%
	Dominion Resources, Inc.	4.92%
	Kinder Morgan, Inc.	4.87%
	Energy Transfer Equity, LP	4.87%
	National Grid PLC	4.87%
	Enbridge, Inc.	4.81%
	TransCanada Corp.	4.76%
	NiSource, Inc.	3.96%

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS – 93.23%	Number				% of
	of Shares		Value		Net Assets
Energy – 25.73%
Cheniere Energy, Inc. (a)		1,512,117	$	85,359,005		5.01	%
Enbridge, Inc. (c)		1,695,348		81,868,355		4.81	%
Energen Corp.		149,992		11,685,877		0.68	%
EQT Corp.		103,460		11,276,105		0.66	%
Kinder Morgan, Inc.		2,539,725		82,947,418		4.87	%
Spectra Energy Corp.		2,117,615		84,090,492		4.94	%
TransCanada Corp. (c)		1,738,827		81,081,503		4.76	%
				438,308,755		25.73	%

Financials – 0.66%
Berkshire Hathaway, Inc., Class A (a)		58		11,209,950		0.66	%

Utilities – 66.84%
AGL Resources, Inc.		955,416		51,592,464		3.03	%
ALLETE, Inc.		3,050		157,868		0.01	%
Alliant Energy Corp.		84,654		4,950,566		0.29	%
Ameren Corp.		189,390		7,823,701		0.46	%
Atmos Energy Corp.		991,762		50,619,532		2.97	%
Avista Corp.		115,972		3,728,500		0.22	%
Black Hills Corp.		97,459		5,628,257		0.33	%
Centerpoint Energy, Inc.		1,530,226		37,888,396		2.22	%
Chesapeake Utilities Corp.		80,161		5,070,985		0.30	%
CMS Energy Corp.		784,648		23,782,681		1.40	%
Consolidated Edison, Inc.		475,886		27,615,665		1.62	%
Corning Natural Gas Holding Corp.		22,663		412,467		0.02	%
Delta Natural Gas Company, Inc.		77,547		1,478,821		0.09	%
Dominion Resources, Inc.		1,156,096		83,863,204		4.92	%
DTE Energy Co.		269,954		21,094,206		1.24	%
Duke Energy Corp.		146,337		10,900,643		0.64	%
Entergy Corp.		16,050		1,163,625		0.07	%
Exelon Corp.		472,881		16,565,021		0.97	%
Gas Natural, Inc.		73,944		805,990		0.05	%
Iberdrola SA – ADR (c)		468,823		13,080,162		0.77	%
Integrys Energy Group, Inc.		402,488		24,664,465		1.45	%
MDU Resources Group, Inc.		668,607		23,682,060		1.39	%
MGE Energy, Inc.		55,496		2,121,057		0.12	%

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Utilities (Continued)
National Fuel Gas Co.		478,324	$	35,223,779		2.07	%
National Grid PLC – ADR (c)		1,166,198		82,870,030		4.87	%
New Jersey Resources Corp.		308,642		15,348,767		0.90	%
NiSource, Inc.		1,856,131		67,414,678		3.96	%
Northeast Utilities		192,475		9,096,368		0.53	%
Northwest Natural Gas Co.		251,594		11,138,066		0.65	%
Northwestern Corp.		119,198		5,766,799		0.34	%
One Gas, Inc. (a)		546,078		19,975,533		1.17	%
ONEOK, Inc.		959,315		60,647,894		3.56	%
Pepco Holdings, Inc.		85,904		2,298,791		0.14	%
PG&E Corp.		1,076,799		49,080,498		2.88	%
Piedmont Natural Gas Company, Inc.		771,172		27,600,246		1.62	%
PPL Corp.		607,035		20,238,547		1.19	%
Public Service Enterprise Group, Inc.		955,790		39,158,716		2.30	%
Questar Corp.		1,348,115		32,732,232		1.92	%
RGC Resources, Inc.		48,967		935,270		0.06	%
SCANA Corp.		251,466		13,498,695		0.79	%
Sempra Energy		851,940		84,009,803		4.93	%
South Jersey Industries, Inc.		228,177		13,108,769		0.77	%
Southwest Gas Corp.		448,178		24,654,272		1.45	%
TECO Energy, Inc.		294,736		5,293,458		0.31	%
The Empire District Electric Co.		29,600		719,872		0.04	%
The Laclede Group, Inc.		313,633		14,869,340		0.87	%
UGI Corp.		244,935		11,436,015		0.67	%
UIL Holdings Corp.		232,133		8,526,245		0.50	%
Unitil Corp.		74,654		2,478,513		0.15	%
UNS Energy Corp.		23,480		1,410,209		0.08	%
Vectren Corp.		314,416		12,755,857		0.75	%
WGL Holdings, Inc.		451,087		17,948,752		1.05	%
Wisconsin Energy Corp.		248,460		12,045,341		0.71	%
Xcel Energy, Inc.		548,399		17,477,476		1.03	%
				1,138,449,167		66.84	%

Total Common Stocks
(Cost $1,151,366,256)				1,587,967,872		93.23	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

PARTNERSHIPS – 5.57%	Number					% of
	of Shares		Value			Net Assets
Energy – 5.57%
Energy Transfer Equity, LP		1,779,408	$	82,902,619			4.87	%
Plains GP Holdings, LP		435,000		11,992,950			0.70	%

Total Partnerships
(Cost $43,352,818)				94,895,569			5.57	%

SHORT-TERM INVESTMENTS – 1.44%

Money Market Funds – 1.44%
Fidelity Government Portfolio –
Institutional Class, 0.01% (b)		24,448,813		24,448,813			1.44	%

Total Money Market Funds
(Cost $24,448,813)				24,448,813			1.44	%

Total Short-Term Investments
(Cost $24,448,813)				24,448,813			1.44	%

Total Investments
(Cost $1,219,167,887) – 100.24%				1,707,312,254			100.24	%
Liabilities in Excess
of Other Assets – (0.24)%				(4,051,380	)		(0.24	)%
TOTAL NET ASSETS – 100.00%			$	1,703,260,874			100.00	%

Percentages are stated as a percent of net assets.

ADR – American Depositary Receipt

(a)	Non-income producing security.
(b)	The rate listed is the fund’s 7-day yield as of April 30, 2014.
(c)	U.S. traded security of a foreign corporation.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Energy	$	438,308,755	$	—	$	—	$	438,308,755
Financials		11,209,950		—		—		11,209,950
Utilities		1,138,449,167		—		—		1,138,449,167
Total Common Stock	$	1,587,967,872	$	—	$	—	$	1,587,967,872
Partnerships
Energy	$	94,895,569	$	—	$	—	$	94,895,569
Total Partnerships	$	94,895,569	$	—	$	—	$	94,895,569
Short-Term Investments
Money Market Funds	$	24,448,813	$	—	$	—	$	24,448,813
Total Short-Term Investments	$	24,448,813	$	—	$	—	$	24,448,813
Total Investments	$	1,707,312,254	$	—	$	—	$	1,707,312,254

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized transfers between Levels 1 and 2.

Below is a reconciliation that details the transfer of securities between Level 1 and Level 2 during the reporting period.

	Common Stock
Transfers into Level 1	$	412,467
Transfers out of Level 1		—
Net transfers into/(out of) Level 1		412,467
Transfers into Level 2		—
Transfers out of Level 2		(412,467	)
Net transfers into/(out of) Level 2	$	(412,467	)

The Fund transferred $412,467 from Level 2 to Level 1 at April 30, 2014. The security was transferred due to lack of an active market on October 31, 2013, but actively traded on April 30, 2014.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $1,219,167,887)	$	1,707,312,254
Cash		613,028
Dividends and interest receivable		2,740,238
Receivable for fund shares sold		16,582,951
Return of capital receivable		74,189
Prepaid expenses and other assets		34,771
Total Assets		1,727,357,431

LIABILITIES:
Payable for securities purchased		22,032,098
Payable for fund shares redeemed		890,212
Payable to advisor		527,936
Payable to administrator		296,392
Payable to auditor		9,472
Accrued trustees fees		4,979
Accrued expenses and other payables		335,468
Total Liabilities		24,096,557
NET ASSETS	$	1,703,260,874

NET ASSETS CONSIST OF:
Capital stock	$	1,220,106,304
Accumulated net investment income		1,628,108
Accumulated net realized loss on investments		(6,613,953	)
Unrealized net appreciation on investments		488,140,415
Total Net Assets	$	1,703,260,874

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		1,703,260,874
Shares issued and outstanding		58,111,660
Net asset value, offering price and redemption price per share	$	29.31

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income(1)	$	20,563,005
Interest income		1,007
Total investment income		20,564,012

EXPENSES:
Investment advisory fees		2,693,187
Sub-transfer agent expenses – Investor Class (See Note 5)		1,279,264
Administration, fund accounting, custody and transfer agent fees		807,956
Reports to shareholders		85,937
Federal and state registration fees		19,776
Trustees’ fees and expenses		12,645
Compliance expense		10,655
Audit fees		9,471
Legal fees		2,976
Other expenses		313,119
Total expenses		5,234,986
NET INVESTMENT INCOME	$	15,329,026

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	9,770,574
Change in unrealized appreciation on investments		158,335,296
Net gain on investments		168,105,870
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	183,434,896

(1)	Net of foreign taxes withheld of $325,603.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

(This Page Intentionally Left Blank.)

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Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment income	$	15,329,026		$	23,732,673
Net realized gain on securities		9,770,574			20,377,887
Change in unrealized appreciation on securities		158,335,296			131,840,690
Net increase in net assets resulting from operations		183,434,896			175,951,250

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Investor Class		(13,700,918	)		(23,162,526	)
Net realized gains
Investor Class		(27,515,133	)		(17,562,108	)
Total distributions		(41,216,051	)		(40,724,634	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		481,404,758			575,374,779
Dividends reinvested – Investor Class		38,960,692			38,473,417
Cost of shares redeemed – Investor Class		(142,114,269	)(1)		(313,104,396	)(2)
Net increase in net assets derived
from capital share transactions		378,251,181			300,743,800
TOTAL INCREASE IN NET ASSETS		520,470,026			435,970,416

NET ASSETS:
Beginning of period		1,182,790,848			746,820,432
End of period	$	1,703,260,874		$	1,182,790,848
Undistributed net investment income, end of period	$	1,628,108		$	—

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		17,545,097			23,099,378
Shares issued to holders as reinvestment
of dividends – Investor Class		1,482,604			1,647,989
Shares redeemed – Investor Class		(5,233,658	)		(12,830,834	)
Net increase in shares outstanding		13,794,043			11,916,533

(1)	Net of redemption fees of $6,816 related to redemption fees imposed by the FBR Gas Utility Index Fund during a prior year but not received until the six-month period ended April 30, 2014.
(2)	Net of redemption fees of $4,408 related to redemption fees imposed by the FBR Gas Utility Index Fund during a prior year but not received until fiscal year 2013.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Gas Utility Index Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	26.69

Income from investment operations:
Net investment income		0.30
Net realized and unrealized gains on securities		3.19
Total from investment operations		3.49

Less distributions:
Dividends from net investment income		(0.27	)
Dividends from realized capital gains		(0.60	)
Total distributions		(0.87	)
Paid-in capital from redemption fees		—
Net asset value, end of period	$	29.31

TOTAL RETURN		13.49	%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	1,703.26
Ratio of expenses to average net assets:
Before expense reimbursement		0.78	%(3)
After expense reimbursement		0.78	%(3)
Ratio of net investment income to average net assets:
Before expense reimbursement		2.28	%(3)
After expense reimbursement		2.28	%(3)
Portfolio turnover rate		5	%(4)

(1)	Calculated based on average shares outstanding method.
(2)	Amount is less than $0.01.
(3)	Annualized.
(4)	Not annualized.

The accompanying notes are an integral part of these financial statements.

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Year Ended October 31,
2013			2012			2011			2010			2009

$	23.05		$	21.21		$	17.83		$	15.13		$	15.26


	0.62			0.58			0.51	(1)		0.58			0.49
	4.18			1.99			3.59			2.72			0.60
	4.80			2.57			4.10			3.30			1.09


	(0.61	)		(0.58	)		(0.51	)		(0.58	)		(0.49	)
	(0.55	)		(0.16	)		(0.21	)		(0.02	)		(0.74	)
	(1.16	)		(0.74	)		(0.72	)		(0.60	)		(1.23	)
	0.00	(2)		0.01			0.00	(2)		0.00	(2)		0.01
$	26.69		$	23.05		$	21.21		$	17.83		$	15.13

	21.70	%		12.41	%		23.54	%		22.25	%		8.18	%


$	1,182.79		$	746.82		$	433.78		$	244.04		$	193.68

	0.80	%		0.69	%		0.71	%		0.77	%		0.76	%
	0.80	%		0.69	%		0.71	%		0.76	%		0.76	%

	2.56	%		2.72	%		2.68	%		3.50	%		3.51	%
	2.56	%		2.72	%		2.68	%		3.51	%		3.51	%
	18	%		16	%		17	%		16	%		26	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Gas Utility Index Fund (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund is a successor to the FBR Gas Utility Index Fund (the “Predecessor FBR Fund”), a series of The FBR Funds, a Delaware statutory trust, pursuant to a reorganization that took place after the close of business on October 26, 2012. Prior to October 26, 2012, the Fund had no investment operations. As a result of the reorganization, holders of the Investor Class shares of the Predecessor FBR Fund received Investor Class shares of the Fund (the Investor Class shares of the Fund are the successor to the accounting and performance information of the Predecessor FBR Fund). The investment objective of the Fund is income and capital appreciation. The Fund is a non-diversified fund.

The Fund offers Investor Class shares.

2). SIGNIFICANT ACCOUNTING POLICIES

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis. The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out on a calendar quarter basis. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the 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

HENNESSYFUNDS.COM

	proceeds. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.
	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions

HENNESSY FUNDS 1-800-966-4354

	and concluded that there is no impact on the Fund’s net assets and no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

	Level 1 –	Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.
	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.
	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those

HENNESSYFUNDS.COM

inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

Fair valuing of foreign securities may be determined with the assistance of a pricing service using correlations between the movement of prices of such securities and indices

HENNESSY FUNDS 1-800-966-4354

of domestic securities and other appropriate indicators, such as closing market prices of relevant American Depositary Receipts or futures contracts. The effect of using fair value pricing is that the Fund’s NAV will reflect the affected portfolio securities’ value as determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price foreign securities may result in a value that is different from a foreign security’s most recent closing price and from the prices used by other investment companies to calculate their net asset values and are generally considered Level 2 prices in the fair valuation hierarchy. Because the Fund may invest in foreign securities, the value of the Fund’s portfolio securities may change on days when you will not be able to purchase or redeem your shares.

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $428,786,470 and $74,562,337, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund for the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Hennessy Advisors, Inc. (the “Advisor”) is the investment advisor of the Fund. The Advisor provides the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnishes 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 from the Fund. The fee is based upon the average daily net assets of the Fund at the annual rate of 0.40%. The net investment advisory fees payable for the Fund as of April 30, 2014 were $527,936.

The Fund has adopted a plan pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended, that authorizes payments in connection with the

HENNESSYFUNDS.COM

distribution of the Fund’s shares at an annual rate of up to 0.25% of the Fund’s average daily net assets, but the plan will not be implemented prior to October 26, 2014. Amounts paid under the plan may be spent on any activities or expenses primarily intended to result in the sale of shares, including but not limited to, advertising, compensation for sales and marketing activities or financial institutions and others such as dealers and distributors, shareholder account servicing, the printing and mailing of prospectuses to other than current shareowners, and the printing and mailing of sales literature.

6). LINE OF CREDIT

HENNESSY FUNDS 1-800-966-4354

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	869,739,852
Gross tax unrealized appreciation	$	338,296,903
Gross tax unrealized depreciation		(24,875,224	)
Net tax unrealized appreciation/depreciation	$	313,421,679
Undistributed ordinary income	$	9,951,374
Undistributed long-term capital gains		17,563,261
Total distributable earnings	$	27,514,635
Other accumulated gain (loss)	$	(589	)
Total accumulated gain (loss)	$	340,935,725

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had no tax basis capital losses to offset future capital gains.

At October 31, 2013, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals or post-December loss deferrals.

The tax character of distributions paid during fiscal year 2014 (year-to-date) and fiscal year 2013 for the Fund were as follows:

	Six Months Ended		Year Ended
	April 30, 2014		October 31, 2013
Ordinary income	$	23,652,336	$	25,896,541
Long-term capital gain		17,563,715		14,828,093
	$	41,216,051	$	40,724,634

HENNESSYFUNDS.COM

Expense Example (Unaudited)

April 30, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$1,134.90	$4.13

Hypothetical (5% return
before expenses)	$1,000.00	$1,020.93	$3.91

(1)	Expenses are equal to the Fund’s annualized expense ratio of 0.78%, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

HENNESSYFUNDS.COM

Proxy Voting

Quarterly Filings on Form N-Q

Federal Tax Distribution Information

(Unaudited)

For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the fiscal year ended October 31, 2013 was 81.42%.

Householding

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreement

At its meeting on March 3, 2014, the Board of Trustees of the Fund (the “Board”) unanimously approved the continuation of the investment advisory agreement of the Fund.

•	The Board considered the services identified below that are provided by the Advisor:
	•	The Advisor acts as portfolio manager for the Fund. In this capacity, the Advisor manages the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
	•	The Advisor performs daily reconciliations of portfolio positions and cash for the Fund.
	•	The Advisor manages the use of soft dollars for the Fund.
	•	The Advisor monitors compliance by the Fund with its investment objectives and restrictions.
	•	The Advisor monitors compliance with federal securities laws and performs activities such as maintaining a compliance program, conducting ongoing reviews of the compliance programs of the Fund’s service providers, conducting on-site visits to the Fund’s service providers, monitoring incidents of abusive trading practices, reviewing Fund expense accruals, payments, and fixed expense ratios, evaluating insurance providers for fidelity bond coverage and D&O/E&O insurance coverage, conducting employee compliance training, reviewing reports provided by service providers, maintaining books and records, and preparing an annual compliance report to the Board.
	•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, custodial, sales and marketing, audit, information technology, and legal services.
	•	The Advisor maintains an in-house public relations and marketing department on behalf of the Fund.
	•	The Advisor is actively involved with preparing regulatory filings for the Fund.
	•	The Advisor manages proxy voting for the Fund.
	•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab, Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund,

HENNESSYFUNDS.COM

		which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
	•	The Advisor pays the incentive compensation of all of the Fund’s compliance officers and employs other staff such as management executives, legal personnel, marketing personnel, national accounts and distribution personnel, sales personnel, and trading oversight personnel.
	•	The Advisor prepares or reviews Board materials, frequently presents to the Board or leads Board discussions, prepares or reviews meeting minutes, and arranges for Board training and education.
•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the continuation of the advisory agreement.
•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
•	The Board considered the fees charged by the Advisor to those of funds similar in asset size and investment objective to the Fund and concluded the advisory fee of the Fund was reasonable and warranted continuation of the advisory agreement. The Trustees noted that the investment advisory fees are not adjusted if economies of scale are realized as the Fund grows because many of the expenses incurred by the Advisor to manage the Fund are asset-based fees and thus do not result in material economies of scale being realized as the net assets of the Fund increase.
•	The Board considered the profitability of the Advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
•	The Board considered the high level of professionalism and knowledge of the Advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

HENNESSY FUNDS 1-800-966-4354

For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

Tait, Weller & Baker LLP

1818 Market Street, Suite 2400

Philadelphia, Pennsylvania 19103

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY SMALL CAP

FINANCIAL FUND

Investor Class HSFNX

Institutional Class HISFX

hennessyfunds.com | 1-800-966-4354

(This Page Intentionally Left Blank.)

Contents

Letter to Shareholders	2
Performance Overview	4
Financial Statements
Schedule of Investments	6
Statement of Assets and Liabilities	10
Statement of Operations	11
Statements of Changes in Net Assets	12
Financial Highlights	14
Notes to the Financial Statements	18
Expense Example	25
Proxy Voting	27
Quarterly Filings on Form N-Q	27
Federal Tax Distribution Information	27
Householding	27
Board Approval of Investment Advisory Agreement	28

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

HENNESSYFUNDS.COM

Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Dow Jones Industrial Average and S&P 500 are unmanaged indices commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014

	Six	One	Five	Ten
	Months(1)	Year	Years	Years
Hennessy Small Cap Financial Fund –
Investor Class (HSFNX)	0.47%	15.79%	13.68%	5.52%
Hennessy Small Cap Financial Fund –
Institutional Class (HISFX)(2)	0.58%	16.16%	13.87%	5.67%
Russell 2000® Financial
Services Index	2.91%	13.36%	16.51%	5.58%
Russell 2000® Index	3.08%	20.50%	19.84%	8.67%

Expense ratios: 1.50% (Investor Class); 1.19% (Institutional Class)

The expense ratios presented are from the most recent prospectus.

(1)	Periods less than one year are not annualized.

(2)

The inception date of the Institutional Class shares is May 30, 2008. Performance shown prior to the inception of the Institutional Class shares reflects the performance of the Investor Class shares and includes expenses that are not applicable to and are higher than those of the Institutional Class shares.

PERFORMANCE NARRATIVE

Portfolio Manager, David H. Ellison, and Co-Portfolio Manager, Ryan Kelley

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Investor Class of the Hennessy Small Cap Financial Fund returned 0.47%, underperforming the Russell 2000® Financial Services Index, the Russell 2000® Index, and the Morningstar Financial Category Average, which returned 2.91%, 3.08%, and 5.20% for the same period, respectively.

Companies with the strongest performance contributions to the Fund during the period include mortgage insurance companies, commercial real estate finance companies, and traditional banks. Specific positions that contributed most strongly to the Fund’s performance include Genworth Financial, Inc., NorthStar Realty Finance Corp., and Popular, Inc. The Fund continues to hold all of these positions.

Companies detracting from the Fund’s performance during the period include mortgage banking companies. Specific positions that detracted from the Fund’s performance include Nationstar Mortgage Holdings, Inc., Ocwen Financial Corp., and

HENNESSYFUNDS.COM

Stonegate Mortgage Corporation. The Fund no longer holds Nationstar Mortgage Holdings, Inc. or Ocwen Financial Corp.

Additional Portfolio Manager commentary and related investment outlook:

We are now in the fifth year of recovery from the depths of the most recent recession and housing crash. The banking industry just completed another year of recovery as credit, capital, liquidity, and liability structures improved. During the last twelve months, housing has shown real signs of recovery as prices and purchase activity increased noticeably. Headwinds do remain, however, as new compliance costs have increased, demand for loans remains muted by historical standards, and concerns about the overall strength of the economy have tempered enthusiasm for financial companies.

We have positioned the Fund in companies that we believe are prepared to take advantage of further economic recovery. Small capitalization financial companies are focused on housing as it relates to demand, credit, and lending spreads. Our research shows that small banks obtain approximately 80% of their revenues from the lending margin on residential housing. Any improvement in loan volumes and lending spreads should be meaningful to earnings growth going forward. Finally, industry consolidation activity has increased over the last twelve months. We expect this to become a factor in the Fund’s performance in the periods ahead.

We believe there is still much work to be done that could positively impact earnings for small financial companies going forward. Along with loan growth and improved spreads, there are cost containment objectives, fee income growth, reduced credit costs, and valuation benefits from increased consolidation. We strive to position the Fund to give shareholders national exposure to the best opportunities in the small capitalization financial space with attention to earnings growth, earnings quality, and valuation discipline.

The Russell 2000® Financial Services Index is an unmanaged index commonly used to measure the performance of U.S. small-capitalization financial sector stocks. The Russell 2000® Index is an unmanaged index commonly used to measure the performance of U.S. small-capitalization stocks. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund is non-diversified, meaning it concentrates its assets in fewer holdings than a diversified fund and is therefore more exposed to individual stock volatility than a diversified fund. The Fund invests in smaller-capitalization companies, which involves additional risks such as more limited liquidity and greater volatility than large-capitalization companies. Investments are focused in the financial services industry, which may be adversely affected by regulatory or other market conditions such as rising interest rates. References to specific securities should not be considered a recommendation to buy or sell any security. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

Earnings growth is not a measure of the Fund’s future performance.

HENNESSY FUNDS 1-800-966-4354

Schedule of Investments

HENNESSY SMALL CAP FINANCIAL FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Genworth Financial, Inc.	4.09%
	Astoria Financial Corp.	3.76%
	Washington Federal, Inc.	3.63%
	Encore Capital Group, Inc.	3.60%
	Synovus Financial Corp.	3.58%
	Wintrust Financial Corp.	3.56%
	BankUnited, Inc.	3.56%
	Flushing Financial Corp.	3.53%
	Radian Group, Inc.	3.52%
	Zions Bancorporation	3.50%

HENNESSYFUNDS.COM

COMMON STOCKS – 97.38%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 1.28%
KB Home		205,000	$	3,384,550		1.28	%

Financials – 95.15%
Associated Banc-Corp.		410,000		7,195,500		2.72	%
Astoria Financial Corp.		750,000		9,945,000		3.76	%
Bancorp, Inc. Del (a)		490,000		7,751,800		2.93	%
Bank Mutual Corp.		30,000		180,600		0.07	%
BankUnited, Inc.		285,000		9,402,150		3.56	%
Banner Corp.		155,000		6,128,700		2.32	%
Capital Bank Financial Corp. (a)		186,308		4,443,446		1.68	%
Center Bancorp, Inc.		20,000		370,200		0.14	%
Centerstate Banks, Inc.		105,000		1,151,850		0.43	%
Customers Bancorp, Inc. (a)		240,000		5,287,200		2.00	%
Encore Capital Group, Inc. (a)		220,000		9,508,400		3.60	%
Everbank Financial Corp.		20,000		374,400		0.14	%
First Bancorp (a)(c)		980,000		5,037,200		1.91	%
First Connecticut Bancorp, Inc.		110,000		1,743,500		0.66	%
First Internet Bancorp		188,480		4,114,518		1.56	%
Flagstar Bancorp, Inc. (a)		375,000		6,600,000		2.50	%
Flushing Financial Corp.		485,000		9,321,700		3.53	%
Fulton Financial Corp.		365,000		4,449,350		1.68	%
Genworth Financial, Inc. (a)		605,000		10,799,250		4.09	%
Green Dot Corp., Class A (a)		25,000		434,250		0.16	%
Hingham Institution for Savings		94,000		6,533,940		2.47	%
HomeStreet, Inc.		376,000		6,828,160		2.58	%
Independent Bank Corp. – Mich (a)		290,000		3,775,800		1.43	%
Independent Bank Corp.		35,000		1,299,200		0.49	%
Investors Bancorp, Inc.		235,000		6,281,550		2.38	%
KKR Financial Holdings LLC		460,000		5,308,400		2.01	%
MBIA, Inc. (a)		565,000		6,847,800		2.59	%
MGIC Investment Corp. (a)		815,000		7,009,000		2.65	%
National Bank Holdings Corp.		50,000		958,000		0.36	%
NorthStar Realty Finance Corp.		180,000		2,883,600		1.09	%
OceanFirst Financial Corp.		220,400		3,574,888		1.35	%
Pacwest Bancorp		55,000		2,165,350		0.82	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Financials (Continued)
Popular, Inc. (a)(c)		290,000	$	8,961,000		3.39	%
Portfolio Recovery Associates, Inc. (a)		12,000		685,800		0.26	%
Provident Financial Services, Inc.		490,000		8,516,200		3.22	%
Radian Group, Inc.		665,000		9,296,700		3.52	%
RAIT Financial Trust		435,000		3,558,300		1.35	%
Rockville Financial, Inc.		160,000		2,105,600		0.80	%
Square 1 Financial, Inc. (a)		95,000		1,790,750		0.68	%
Stonegate Mortgage Corp. (a)		440,000		5,566,000		2.11	%
Susquehanna Bancshares, Inc.		415,000		4,299,400		1.63	%
Synovus Financial Corp.		2,950,000		9,469,500		3.58	%
Territorial Bancorp, Inc.		90,000		1,841,400		0.70	%
UMPQUA Holdings Corp.		292,425		4,863,028		1.84	%
United Financial Bancorp, Inc.		85,000		1,499,400		0.57	%
Washington Federal, Inc.		445,000		9,603,100		3.63	%
Webster Financial Corp.		30,000		904,200		0.34	%
Wintrust Financial Corp.		210,000		9,412,200		3.56	%
WSFS Financial Corp.		31,700		2,143,554		0.81	%
Zions Bancorporation		320,000		9,254,400		3.50	%
				251,475,234		95.15	%

Information Technology – 0.95%
Move, Inc. (a)		145,000		1,550,050		0.59	%
Total System Services, Inc.		30,000		953,100		0.36	%
				2,503,150		0.95	%

Total Common Stocks
(Cost $214,590,653)				257,362,934		97.38	%

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

SHORT-TERM INVESTMENTS – 2.29%	Number				% of
	of Shares		Value		Net Assets
Money Market Funds – 2.29%
Fidelity Government Portfolio –
Institutional Class, 0.01% (b)		6,046,707	$	6,046,707		2.29	%

Total Money Market Funds
(Cost $6,046,707)				6,046,707		2.29	%

Total Short-Term Investments
(Cost $6,046,707)				6,046,707		2.29	%

Total Investments
(Cost $220,637,360) – 99.67%				263,409,641		99.67	%
Other Assets in
Excess of Liabilities – 0.33%				872,881		0.33	%
TOTAL NET ASSETS – 100.00%			$	264,282,522		100.00	%

Percentages are stated as a percent of net assets.

(a)	Non-income producing security.
(b)	The rate listed is the fund’s 7-day yield as of April 30, 2014.
(c)	U.S. traded security of a foreign corporation.

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	3,384,550	$	—	$	—	$	3,384,550
Financials		251,475,234		—		—		251,475,234
Information Technology		2,503,150		—		—		2,503,150
Total Common Stock	$	257,362,934	$	—	$	—	$	257,362,934
Short-Term Investments
Money Market Funds	$	6,046,707	$	—	$	—	$	6,046,707
Total Short-Term Investments	$	6,046,707	$	—	$	—	$	6,046,707
Total Investments	$	263,409,641	$	—	$	—	$	263,409,641

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized no transfers between levels.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $220,637,360)	$	263,409,641
Dividends and interest receivable		67,944
Receivable for fund shares sold		171,768
Receivable for securities sold		2,365,644
Prepaid expenses and other assets		23,555
Total Assets		266,038,552

LIABILITIES:
Payable for fund shares redeemed		1,361,226
Payable to advisor		207,553
Payable to administrator		59,883
Payable to auditor		9,473
Accrued distribution fees		51,946
Accrued trustees fees		4,940
Accrued expenses and other payables		61,009
Total Liabilities		1,756,030
NET ASSETS	$	264,282,522

NET ASSETS CONSIST OF:
Capital stock	$	200,309,572
Accumulated net investment loss		(409,035	)
Accumulated net realized gain on investments		21,609,704
Unrealized net appreciation on investments		42,772,281
Total Net Assets	$	264,282,522

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		209,895,027
Shares issued and outstanding		8,779,193
Net asset value, offering price and redemption price per share	$	23.91

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares		54,387,495
Shares issued and outstanding		3,783,594
Net asset value, offering price and redemption price per share	$	14.37

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income	$	2,310,356
Interest income		326
Total investment income		2,310,682

EXPENSES:
Investment advisory fees		1,379,717
Distribution fees – Investor Class (See Note 5)		300,209
Administration, fund accounting, custody and transfer agent fees		183,963
Sub-transfer agent expenses – Investor Class (See Note 5)		146,618
Sub-transfer agent expenses – Institutional Class (See Note 5)		17,606
Reports to shareholders		32,860
Federal and state registration fees		18,562
Compliance expense		10,655
Audit fees		9,472
Trustees’ fees and expenses		8,529
Legal fees		2,480
Interest expense (See Note 6)		582
Other expenses		12,050
Total expenses		2,123,303
NET INVESTMENT INCOME	$	187,379
REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	24,571,730
Change in unrealized appreciation on investments		(21,473,411	)
Net gain on investments		3,098,319
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	3,285,698

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment income	$	187,379		$	1,386,645
Net realized gain on securities		24,571,730			27,485,214
Change in unrealized appreciation (depreciation)
on securities		(21,473,411	)		40,111,802
Net increase in net assets resulting from operations		3,285,698			68,983,661

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Investor Class		(583,882	)		(1,118,880	)
Institutional Class		(611,323	)		(520,872	)
Net realized gains
Investor Class		(15,192,378	)		—
Institutional Class		(6,931,392	)		—
Total distributions		(23,318,975	)		(1,639,752	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		15,857,413			91,423,499
Proceeds from shares subscribed – Institutional Class		3,929,622			25,715,806
Dividends reinvested – Investor Class		15,450,637			1,096,037
Dividends reinvested – Institutional Class		3,238,127			123,116
Cost of shares redeemed – Investor Class		(51,142,355	)(1)		(71,541,810	)(2)
Cost of shares redeemed – Institutional Class		(15,240,174	)		(12,933,095	)
Net increase (decrease) in net assets derived
from capital share transactions		(27,906,730	)		33,883,553
TOTAL INCREASE (DECREASE) IN NET ASSETS		(47,940,007	)		101,227,462

NET ASSETS:
Beginning of period		312,222,529			210,995,067
End of period	$	264,282,522		$	312,222,529
Undistributed net investment income (loss), end of period	$	(409,035	)	$	598,791

(1)	Net of redemption fees of $12,269 related to redemption fees imposed by the FBR Small Cap Financial Fund during a prior year but not received until the six-month period ended April 30, 2014.
(2)	Net of redemption fees of $2,257 related to redemption fees imposed by the FBR Small Cap Financial Fund during a prior year but not received until fiscal year 2013.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Statements of Changes in Net Assets – Continued

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		628,937			4,155,799
Shares sold – Institutional Class		258,120			1,761,812
Shares issued to holders as reinvestment
of dividends – Investor Class		624,580			55,049
Shares issued to holders as reinvestment
of dividends – Institutional Class		216,312			9,865
Shares redeemed – Investor Class		(2,056,136	)		(3,185,460	)
Shares redeemed – Institutional Class		(1,001,402	)		(1,010,378	)
Net increase (decrease) in shares outstanding		(1,329,589	)		1,786,687

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Small Cap Financial Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	25.40

Income from investment operations:
Net investment income		0.01
Net realized and unrealized gains (losses) on securities		0.16
Total from investment operations		0.17

Less distributions:
Dividends from net investment income		(0.06	)
Dividends from net realized gains		(1.60	)
Total distributions		(1.66	)
Paid-in capital from redemption fees		—
Net asset value, end of period	$	23.91

TOTAL RETURN		0.47	%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	209.90
Ratio of expenses to average net assets		1.45	%(5)
Ratio of net investment income to average net assets		0.52	%(5)
Portfolio turnover rate(3)		25	%(4)

(1)	Calculated based on average shares outstanding method.
(2)	Amount is less than $0.01.
(3)	Portfolio turnover is calculated on the basis of the Fund as a whole.
(4)	Not annualized.
(5)	Annualized

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Year Ended October 31,
2013			2012			2011			2010			2009

$	19.54		$	16.48		$	18.11		$	15.91		$	15.22


	0.10			0.11			0.21	(1)		0.08			0.06
	5.88			3.24			(1.66	)		2.17			0.81
	5.98			3.35			(1.45	)		2.25			0.87


	(0.12	)		(0.29	)		(0.06	)		(0.07	)		(0.19	)
	—			—			(0.13	)		—			—
	(0.12	)		(0.29	)		(0.19	)		(0.07	)		(0.19	)
	0.00	(2)		0.00	(2)		0.01			0.02			0.01
$	25.40		$	19.54		$	16.48		$	18.11		$	15.91

	30.80	%		20.65	%		(8.12	)%		14.27	%		5.89	%


$	243.42		$	167.20		$	154.21		$	216.75		$	187.56
	1.46	%		1.45	%		1.52	%		1.51	%		1.51	%
	0.48	%		0.56	%		0.81	%		0.35	%		0.50	%
	57	%		43	%		70	%		89	%		118	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Small Cap Financial Fund

For an Institutional Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	15.96

Income from investment operations:
Net investment income		0.00	(2)
Net realized and unrealized gains (losses) on securities		0.15
Total from investment operations		0.15

Less distributions:
Dividends from net investment income		(0.14	)
Dividends from net realized gains		(1.60	)
Total distributions		(1.74	)
Paid-in capital from redemption fees		—
Net asset value, end of period	$	14.37

TOTAL RETURN		0.58	%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	54.39
Ratio of expenses to average net assets		1.14	%(5)
Ratio of net investment income to average net assets		0.37	%(5)
Portfolio turnover rate(3)		25	%(4)

(1)	Calculated based on average shares outstanding method.
(2)	Amount is less than $0.01.
(3)	Portfolio turnover is calculated on the basis of the Fund as a whole.
(4)	Not annualized.
(5)	Annualized.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Year Ended October 31,
2013			2012			2011			2010			2009

$	12.34		$	10.55		$	11.70		$	10.34		$	9.96


	0.14			0.16			0.19	(1)		0.09			0.19
	3.66			1.98			(1.09	)		1.40			0.40
	3.80			2.14			(0.90	)		1.49			0.59


	(0.18	)		(0.35	)		(0.12	)		(0.13	)		(0.21	)
	—			—			(0.13	)		—			—
	(0.18	)		(0.35	)		(0.25	)		(0.13	)		(0.21	)
	—			0.00	(2)		—			0.00	(2)		—
$	15.96		$	12.34		$	10.55		$	11.70		$	10.34

	31.18	%		20.95	%		(8.00	)%		14.52	%		6.14	%


$	68.80		$	43.79		$	19.89		$	25.01		$	10.64
	1.15	%		1.25	%		1.34	%		1.23	%		1.56	%
	0.74	%		0.72	%		1.00	%		0.61	%		0.04	%
	57	%		43	%		70	%		89	%		118	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Small Cap Financial (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund is a successor to the FBR Small Cap Financial Fund (the “Predecessor FBR Fund”), a series of The FBR Funds, a Delaware statutory trust, pursuant to a reorganization that took place after the close of business on October 26, 2012. Prior to October 26, 2012, the Fund had no investment operations. As a result of the reorganization, holders of the Investor Class shares of the Predecessor FBR Fund received Investor Class shares of the Fund (the Investor Class shares of the Fund are the successor to the accounting and performance information of the Predecessor FBR Fund), and holders of the Institutional Class shares of the Predecessor FBR Fund received Institutional Class shares of the Fund (the Institutional Class shares of the Fund are the successor to the accounting and performance information of the Predecessor FBR Fund). The investment objective of the Fund is capital appreciation. The Fund is a non-diversified fund.

The Fund offers Investor Class and Institutional Class shares. Each class of shares differs principally in its respective administration, 12b-1 distribution and service fees, shareholder servicing, and transfer agent expenses and sales charges, if any. Each class has identical rights to earnings, assets, and voting privileges, except for class-specific expenses and exclusive rights to vote on matters affecting only individual classes.

2). SIGNIFICANT ACCOUNTING POLICIES

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis. The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees. Income,

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	expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its respective net assets.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out annually, usually in November or December. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the 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. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.

HENNESSY FUNDS 1-800-966-4354

	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions and concluded that there is no impact on the Fund’s net assets and no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

Level 1 –

Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.

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	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.
	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

The Board of Trustees of the Fund (the “Board”) has adopted fair value pricing procedures that are followed when a price for a security is not readily available or if a

HENNESSY FUNDS 1-800-966-4354

significant event has occurred that indicates the closing price of a security no longer represents the true value of that security. Fair value pricing determinations are made in good faith in accordance with these procedures. There are numerous criteria that will be given consideration in determining a fair value of a security. Some of these criteria are trading volume of security and markets, the value of other like securities, and news events with direct bearing to security or market. Fair value pricing results in an estimated price that reasonably reflects the current market conditions in order to rate the portfolio holdings such that shareholder transactions receive a fair net asset value. Depending on the relative significance of the valuation inputs, these securities may be classified in either Level 2 or Level 3 of the fair value hierarchy.

Fair valuing of foreign securities may be determined with the assistance of a pricing service using correlations between the movement of prices of such securities and indices of domestic securities and other appropriate indicators, such as closing market prices of relevant American Depositary Receipts or futures contracts. The effect of using fair value pricing is that the Fund’s NAV will reflect the affected portfolio securities’ value as determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price foreign securities may result in a value that is different from a foreign security’s most recent closing price and from the prices used by other investment companies to calculate their net asset values and are generally considered Level 2 prices in the fair valuation hierarchy. Because the Fund may invest in foreign securities, the value of the Fund’s portfolio securities may change on days when you will not be able to purchase or redeem your shares.

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $74,289,048 and $124,494,309, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund for the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Hennessy Advisors, Inc. (the “Advisor”) is the investment advisor of the Fund. The Advisor provides the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnishes 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 from the Fund. The fee is based upon the average daily net assets of the Fund at the annual rate of 0.90%. The net investment advisory fees payable for the Fund as of April 30, 2014 were $207,553.

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The Advisor has contractually agreed to limit the total annual operating expenses of the Fund (excluding interest, taxes, brokerage commissions, dividend expenses, acquired fund fees and expenses, extraordinary legal expenses, or any other extraordinary expenses and, from and after November 1, 2014, 12b-1 fees) to 1.95% and 1.70% of the Fund’s net assets for the Investor Class shares and Institutional Class shares of the Fund, respectively, through February 28, 2015.

The Fund has adopted a plan pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended, that authorizes payments in connection with the distribution of the Fund’s shares at an annual rate of up to 0.25% of the Fund’s average daily net assets. Amounts paid under the plan may be spent on any activities or expenses primarily intended to result in the sale of shares, including but not limited to, advertising, compensation for sales and marketing activities or financial institutions and others such as dealers and distributors, shareholder account servicing, the printing and mailing of prospectuses to other than current shareowners, and the printing and mailing of sales literature.

6). LINE OF CREDIT

HENNESSY FUNDS 1-800-966-4354

ended April 30, 2014, the Fund had an outstanding average daily balance and a weighted average interest rate of $36,635 and 3.25%, respectively. The maximum amount outstanding for the Fund during the period was $3,328,000.

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	252,322,381
Gross tax unrealized appreciation	$	68,513,862
Gross tax unrealized depreciation		(7,656,886	)
Net tax unrealized appreciation/depreciation	$	60,856,976
Undistributed ordinary income	$	3,301,727
Undistributed long-term capital gains		19,847,524
Total distributable earnings	$	23,149,251
Other accumulated gain (loss)	$	—
Total accumulated gain (loss)	$	84,006,227

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had no tax basis capital losses to offset future capital gains.

During the year ended October 31, 2013, the Fund’s most recent fiscal year end, the capital loss carry forwards utilized for the Fund were $3,656,683.

At October 31, 2013, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals or post-December loss deferrals.

The tax character of distributions paid during fiscal year 2014 (year-to-date) and fiscal year 2013 for the Fund were as follows:

	Six Months Ended		Year Ended
	April 30, 2014		October 31, 2013
Ordinary income	$	3,471,345	$	1,639,752
Long-term capital gain		19,847,630		—
	$	23,318,975	$	1,639,752

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Expense Example (Unaudited)

April 30, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$1,004.70	$7.21

Hypothetical (5% return
before expenses)	$1,000.00	$1,017.60	$7.25

Institutional Class

Actual	$1,000.00	$1,005.80	$5.67

Hypothetical (5% return
before expenses)	$1,000.00	$1,019.14	$5.71

(1)	Expenses are equal to the Fund’s annualized expense ratio of 1.45% for Investor Class shares or 1.14% for Institutional Class shares, as applicable, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

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Proxy Voting

Quarterly Filings on Form N-Q

Federal Tax Distribution Information

(Unaudited)

For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the fiscal year ended October 31, 2013 was 91.25%.

Householding

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreement

At its meeting on March 3, 2014, the Board of Trustees of the Fund (the “Board”) unanimously approved the continuation of the investment advisory agreement of the Fund.

•

The Board considered the services identified below that are provided by the Advisor:

		•	The Advisor acts as portfolio manager for the Fund. In this capacity, the Advisor manages the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
		•	The Advisor performs daily reconciliations of portfolio positions and cash for the Fund.
		•	The Advisor manages the use of soft dollars for the Fund.
		•	The Advisor monitors compliance by the Fund with its investment objectives and restrictions.
		•	The Advisor monitors compliance with federal securities laws and performs activities such as maintaining a compliance program, conducting ongoing reviews of the compliance programs of the Fund’s service providers, conducting on-site visits to the Fund’s service providers, monitoring incidents of abusive trading practices, reviewing Fund expense accruals, payments, and fixed expense ratios, evaluating insurance providers for fidelity bond coverage and D&O/E&O insurance coverage, conducting employee compliance training, reviewing reports provided by service providers, maintaining books and records, and preparing an annual compliance report to the Board.
		•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, custodial, sales and marketing, audit, information technology, and legal services.
		•	The Advisor maintains an in-house public relations and marketing department on behalf of the Fund.
		•	The Advisor is actively involved with preparing regulatory filings for the Fund.
		•	The Advisor manages proxy voting for the Fund.
		•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab, Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund,

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			which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
		•	The Advisor pays the incentive compensation of all of the Fund’s compliance officers and employs other staff such as management executives, legal personnel, marketing personnel, national accounts and distribution personnel, sales personnel, and trading oversight personnel.
		•	The Advisor prepares or reviews Board materials, frequently presents to the Board or leads Board discussions, prepares or reviews meeting minutes, and arranges for Board training and education.

	•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the continuation of the advisory agreement.
	•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
	•	The Board considered the fees charged by the Advisor to those of funds similar in asset size and investment objective to the Fund and concluded the advisory fee of the Fund was reasonable and warranted continuation of the advisory agreement. The Trustees noted that the investment advisory fees are not adjusted if economies of scale are realized as the Fund grows because many of the expenses incurred by the Advisor to manage the Fund are asset-based fees and thus do not result in material economies of scale being realized as the net assets of the Fund increase.
	•	The Board considered the profitability of the Advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
	•	The Board considered the high level of professionalism and knowledge of the Advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

HENNESSY FUNDS 1-800-966-4354

For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

Tait, Weller & Baker LLP

1818 Market Street, Suite 2400

Philadelphia, Pennsylvania 19103

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY TECHNOLOGY FUND

Investor Class HTECX

Institutional Class HTCIX

hennessyfunds.com | 1-800-966-4354

(This Page Intentionally Left Blank.)

Contents

Letter to Shareholders		2
Performance Overview		4
Financial Statements
Schedule of Investments		7
Statement of Assets and Liabilities		11
Statement of Operations		12
Statements of Changes in Net Assets		13
Financial Highlights		14
Notes to the Financial Statements		18
Expense Example		25
Proxy Voting		27
Quarterly Filings on Form N-Q		27
Householding		27
Board Approval of Investment Advisory Agreement		28

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

HENNESSYFUNDS.COM

Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Dow Jones Industrial Average and S&P 500 are unmanaged indices commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014

	Six	One	Five	Ten
	Months(1)	Year	Years	Years
Hennessy Technology Fund –
Investor Class (HTECX)	-0.81%	15.93%	12.44%	5.45%
Hennessy Technology Fund –
Institutional Class (HTCIX)(2)	-0.66%	16.25%	12.65%	5.55%
NASDAQ Composite Index	5.04%	24.87%	20.36%	8.90%
S&P 500 Index	8.36%	20.44%	19.14%	7.67%

Expense ratios:	Gross 3.08%, Net 1.99%(3) (Investor Class);
	Gross 2.80%, Net 1.74%(3) (Institutional Class)

The expense ratios presented are from the most recent prospectus.

(1)	Periods less than one year are not annualized.
(2)	The inception date of the Institutional Class shares is March 12, 2010. Performance shown prior to the inception of the Institutional Class shares reflects the performance of the Investor Class shares and includes expenses that are not applicable to and are higher than those of the Institutional Class shares.
(3)	The Fund’s investment advisor has contractually agreed to waive a portion of its expenses through February 28, 2015.

PERFORMANCE NARRATIVE

Portfolio Managers Winsor H. Aylesworth and David H. Ellison

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Investor Class of the Hennessy Technology Fund returned -0.81%, underperforming the NASDAQ Composite Index, the S&P 500 Index, and the Morningstar Technology Category Average, which returned 5.04%, 8.36%, and 6.46% for the same period, respectively.

After a relatively good period of performance, the Fund underperformed its benchmarks. During the period, investors for various reasons started taking profits in the names that had appreciated the most. This correction hit stocks in both the Healthcare and Technology sectors. The Healthcare and Technology correction hit the Fund particularly hard because they were a major category of investment. In summary, investor sentiment shifted from a growth bent to a value orientation. Our emphasis on stocks with

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growing tangible book, growing revenues and growing profits, as desirable as that is, just did not reward this period.

Two stocks that did reward us were Illumina, Inc. and athenahealth, Inc., which returned 45% and 29%, respectively. Illumina, Inc. manufactures and markets life science tools and integrated systems for the analytics of data to the biotech industry, while athenahealth, Inc. provides cloud-based services and health record software to the Healthcare industry. With the aging population and the emphasis on managing health care costs, these stocks have been, and are expected to possibly be, in the sweet spot for growth for the foreseeable future. Both of these holdings comprised 3 - 4% of the Fund’s total assets during the period. We feel any market downturn would provide buying opportunity in these holdings, and the Fund continues to hold both of these positions.

Every portfolio has some holdings that underperform and do not meet investment expectations. We are always evaluating information to determine if we deem the underperformance to be just a “blip” or whether the stock should be eliminated from the Fund’s portfolio. Two stocks still owned by the Fund that had what we believe was a “blip” with respect to their recent performance are Amazon.com, Inc. and NetSuite, Inc., with six-month returns of -24% and -23%, respectively. Well known and widely held Amazon.com, Inc. is one of the largest online retailers and has an impressive record of revenue growth. Unfortunately, this is an example of where investors took profits during the period. We continue to believe Amazon.com, Inc. is a leader in combining technology with the retail experience and should continue to grow and has the potential to reward investors again. NetSuite, Inc. is a cloud-based software provider. The stock was not immune to correction as its price had perhaps been overvalued in relation to its impressive record of growth. Each of these holdings comprised 2 ½ - 3% of the Fund’s total assets during the period. The Fund continues to hold both of these positions.

Additional Portfolio Manager commentary and related investment outlook:

Investors have much to be nervous about with geopolitics, job growth, housing starts, and interest rates issues dominating headlines. It is not unexpected that at times investors, both large and small, review their portfolios and rebalance by selling the winners and buying alternatives. It is our belief we are in such a period. The good news is that we believe the Technology industry should continue to entice investors, as it offers potential solutions to the problems of mankind and innovative products for the consumer. As investor fears ease and the economy improves, revenues and profits for successful companies should grow along with their tangible book value. As a result, stock prices should improve. We will continue to offer the Fund’s shareholders exposure to this segment following a consistent approach that emphasizes these metrics.

The NASDAQ Composite Index is a broad-based capitalization-weighted index of all the NASDAQ National Market and Small Cap stocks. The S&P 500 Index is an unmanaged index commonly used to measure the performance of U.S. stocks. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund is non-diversified, meaning it concentrates its assets in fewer holdings than a diversified fund and is therefore more exposed to individual stock volatility than a diversified fund. Investments are focused in the technology industry, which may be adversely affected by rapidly changing technology, availability of capital, R&D, government regulation and the relatively high risks of obsolescence caused by scientific and technological advances. Investments in foreign securities may involve greater volatility and political, economic and currency risk and differences in accounting methods. The Fund may invest in IPOs, which may fluctuate considerably due to the absence of a prior public market and may have a magnified impact on the Fund. The Fund invests in small- and medium-capitalization companies, which involves additional risks such as more limited liquidity and

HENNESSY FUNDS 1-800-966-4354

greater volatility than large-capitalization companies. References to specific securities should not be considered a recommendation to buy or sell any security. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

Tangible Book Value is a method of valuing a company by measuring its equity after removing any intangible assets.

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Schedule of Investments

HENNESSY TECHNOLOGY FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Gilead Sciences, Inc.	5.19%
	Micron Technology, Inc.	4.59%
	SanDisk Corp.	4.56%
	Amazon.com, Inc.	4.55%
	IMS Health Holdings, Inc.	4.53%
	T- Mobile US, Inc.	4.52%
	Illumina, Inc.	4.42%
	Biogen Idec, Inc.	4.36%
	Thermo Fisher Scientific, Inc.	4.35%
	Alexion Pharmaceuticals, Inc.	4.35%

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS – 96.27%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 10.63%
Amazon.com, Inc. (a)		920	$	279,800		4.55	%
Harman International Industries, Inc.		1,050		115,090		1.87	%
NetFlix, Inc. (a)		805		259,242		4.21	%
				654,132		10.63	%

Financials – 1.24%
Zillow, Inc. (a)		705		76,634		1.24	%

Health Care – 30.89%
Alexion Pharmaceuticals, Inc. (a)		1,690		267,358		4.35	%
Align Technology, Inc. (a)		1,440		72,562		1.18	%
athenahealth, Inc. (a)		930		114,985		1.87	%
Biogen Idec, Inc. (a)		935		268,457		4.36	%
Gilead Sciences, Inc. (a)		4,065		319,062		5.19	%
Illumina, Inc. (a)		2,003		272,107		4.42	%
IMS Health Holdings, Inc. (a)		11,750		278,945		4.53	%
Medidata Solutions, Inc. (a)		1,077		39,106		0.64	%
Thermo Fisher Scientific, Inc.		2,350		267,900		4.35	%
				1,900,482		30.89	%

Information Technology – 48.41%
3D Systems Corp. (a)		2,002		94,775		1.54	%
Alliance Fiber Optic Products, Inc.		1,865		35,845		0.58	%
Applied Materials, Inc.		13,950		265,887		4.32	%
Arris Group, Inc. (a)		2,182		56,928		0.93	%
Bottomline Technologies, Inc. (a)		1,000		31,640		0.51	%
Finisar Corp. (a)		1,495		39,094		0.64	%
First Solar, Inc. (a)		1,545		104,272		1.69	%
Fleetmatics Group PLC (a)(c)		2,195		65,916		1.07	%
iGATE Corp. (a)		975		35,685		0.58	%
Imperva, Inc. (a)		2,200		50,336		0.82	%
Interactive Intelligence Group, Inc (a)		625		39,106		0.64	%
LAM Research Corp. (a)		2,830		163,036		2.65	%
Lattice Semiconductor Corp. (a)		5,125		43,153		0.70	%
Methode Electronics, Inc.		1,505		41,749		0.68	%
Micron Technology, Inc. (a)		10,815		282,488		4.59	%
NetSuite, Inc. (a)		1,265		97,797		1.59	%

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Information Technology (Continued)
Pandora Media, Inc. (a)		5,100	$	119,442		1.94	%
Proofpoint, Inc. (a)		2,100		53,424		0.87	%
salesforce.com, Inc. (a)		5,120		264,448		4.30	%
SanDisk Corp.		3,300		280,401		4.56	%
Servicenow, Inc. (a)		2,750		136,730		2.22	%
Splunk, Inc. (a)		2,500		136,425		2.22	%
SS&C Technologies Holdings, Inc. (a)		1,275		49,623		0.81	%
Stratasys Ltd. (a)(c)		860		83,308		1.35	%
The Ultimate Software Group, Inc. (a)		495		59,217		0.96	%
Workday, Inc. (a)		3,615		264,148		4.29	%
Yelp, Inc. (a)		1,440		83,981		1.36	%
				2,978,854		48.41	%

Telecommunication Services – 5.10%
8x8 Inc. (a)		3,665		35,551		0.58	%
T- Mobile US, Inc. (a)		9,500		278,255		4.52	%
				313,806		5.10	%

Total Common Stocks
(Cost $5,861,422)				5,923,908		96.27	%

INVESTMENT COMPANIES (EXCLUDING
MONEY MARKET FUNDS) – 0.52%
Hercules Technology Growth Capital, Inc.		2,320		31,737		0.52	%

Total Investment Companies (Excluding
Money Market Funds)
(Cost $30,636)				31,737		0.52	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

SHORT-TERM INVESTMENTS – 4.00%	Number					% of
	of Shares		Value			Net Assets
Money Market Funds – 4.00%
Fidelity Government Portfolio –
Institutional Class, 0.01% (b)		245,868	$	245,868			4.00	%

Total Money Market Funds
(Cost $245,868)				245,868			4.00	%

Total Short-Term Investments
(Cost $245,868)				245,868			4.00	%

Total Investments
(Cost $6,137,926) – 100.79%				6,201,513			100.79	%
Liabilities in Excess
of Other Assets – (0.79)%				(48,398	)		(0.79	)%
TOTAL NET ASSETS – 100.00%			$	6,153,115			100.00	%

Percentages are stated as a percent of net assets.

(a)	Non-income producing security.
(b)	The rate listed is the fund’s 7-day yield as of April 30, 2014.
(c)	U.S. traded security of a foreign corporation.

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	654,132	$	—	$	—	$	654,132
Financials		76,634		—		—		76,634
Health Care		1,900,482		—		—		1,900,482
Information Technology		2,978,854		—		—		2,978,854
Telecommunication Services		313,806		—		—		313,806
Total Common Stock	$	5,923,908	$	—	$	—	$	5,923,908
Investment Companies (Excluding
Money Market Funds)	$	31,737	$	—	$	—	$	31,737
Short-Term Investments
Money Market Funds	$	245,868	$	—	$	—	$	245,868
Total Short-Term Investments	$	245,868	$	—	$	—	$	245,868
Total Investments	$	6,201,513	$	—	$	—	$	6,201,513

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized no transfers between levels.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $6,137,926)	$	6,201,513
Dividends and interest receivable		137
Receivable for fund shares sold		176
Receivable for securities sold		106,058
Prepaid expenses and other assets		23,881
Due from advisor		485
Total Assets		6,332,250

LIABILITIES:
Payable for securities purchased		114,641
Payable for fund shares redeemed		35,246
Payable to administrator		2,897
Payable to auditor		9,474
Distribution payable		4,873
Accrued trustees fees		5,376
Accrued expenses and other payables		6,628
Total Liabilities		179,135
NET ASSETS	$	6,153,115

NET ASSETS CONSIST OF:
Capital stock	$	7,207,201
Accumulated net investment loss		(117,340	)
Accumulated net realized loss on investments		(1,000,333	)
Unrealized net appreciation on investments		63,587
Total Net Assets	$	6,153,115

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		4,929,734
Shares issued and outstanding		366,256
Net asset value, offering price and redemption price per share	$	13.46

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares		1,223,381
Shares issued and outstanding		90,047
Net asset value, offering price and redemption price per share	$	13.59

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income	$	7,681
Interest income		11
Total investment income		7,692

EXPENSES:
Investment advisory fees		28,040
Federal and state registration fees		16,557
Compliance expense		10,655
Audit fees		9,472
Trustees’ fees and expenses		6,943
Distribution fees – Investor Class (See Note 5)		6,179
Administration, fund accounting, custody and transfer agent fees		3,664
Legal fees		2,480
Sub-transfer agent expenses – Investor Class (See Note 5)		2,460
Sub-transfer agent expenses – Institutional Class (See Note 5)		161
Reports to shareholders		1,106
Other expenses		3,565
Total expenses before reimbursement from advisor		91,282
Expense reimbursement by advisor – Investor Class		(25,872	)
Expense reimbursement from advisor – Institutional Class		(6,267	)
Net expenses		59,143
NET INVESTMENT LOSS	$	(51,451	)

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	767,400
Change in unrealized appreciation on investments		(828,267	)
Net gain (loss) on investments		(60,867	)
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	(112,318	)

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment loss	$	(51,451	)	$	(66,991	)
Net realized gain on securities		767,400			577,798
Change in unrealized appreciation (depreciation)
on securities		(828,267	)		802,157
Net increase (decrease) in net assets
resulting from operations		(112,318	)		1,312,964

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		828,795			633,313
Proceeds from shares subscribed – Institutional Class		84,537			199,069
Cost of shares redeemed – Investor Class		(285,707	)		(1,642,150	)
Cost of shares redeemed – Institutional Class		(42,641	)		(196,791	)
Net increase (decrease) in net assets
derived from capital share transactions		584,984			(1,006,559	)
TOTAL INCREASE IN NET ASSETS		472,666			306,405

NET ASSETS:
Beginning of period		5,680,449			5,374,044
End of period	$	6,153,115		$	5,680,449
Undistributed net investment loss, end of period	$	(117,340	)	$	(65,889	)

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		55,585			54,289
Shares sold – Institutional Class		5,809			16,644
Shares redeemed – Investor Class		(20,262	)		(139,783	)
Shares redeemed – Institutional Class		(2,781	)		(16,569	)
Net increase (decrease) in shares outstanding		38,351			(85,419	)

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Technology Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	13.57

Income from investment operations:
Net investment loss		(0.10	)
Net realized and unrealized gains (losses) on investments		(0.01	)
Total from investment operations		(0.11	)
Paid-in capital from redemption fees		—
Net asset value, end of period	$	13.46

TOTAL RETURN		(0.81	)%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	4.93
Ratio of expenses to average net assets:
Before expense reimbursement		3.00	%(5)
After expense reimbursement		1.95	%(5)
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement		(2.75	)%(5)
After expense reimbursement		(1.70	)%(5)
Portfolio turnover rate(3)		99	%(4)

(1)	Calculated based on average shares outstanding method.
(2)	Amount is less than $0.01.
(3)	Portfolio turnover is calculated on the basis of the Fund as a whole.
(4)	Not annualized.
(5)	Annualized.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Year Ended October 31,
2013			2012			2011			2010			2009

$	10.67		$	10.86		$	11.00		$	9.05		$	6.96


	(0.20	)		(0.15	)		(0.17	)(1)		(0.14	)		(0.08	)
	3.10			(0.04	)		0.03			2.08			2.16
	2.90			(0.19	)		(0.14	)		1.94			2.08
	—			0.00	(2)		0.00	(2)		0.01			0.01
$	13.57		$	10.67		$	10.86		$	11.00		$	9.05

	27.18	%		(1.75	)%		(1.27	)%		21.55	%		30.03	%


$	4.49		$	4.44		$	5.70		$	8.21		$	8.39

	3.04	%		3.20	%		2.79	%		2.50	%		3.00	%
	1.95	%		1.95	%		1.95	%		1.95	%		1.95	%

	(2.36	)%		(2.39	)%		(2.38	)%		(1.64	)%		(2.10	)%
	(1.27	)%		(1.14	)%		(1.54	)%		(1.10	)%		(1.05	)%
	164	%		138	%		141	%		353	%		211	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Technology Fund

For an Institutional Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	13.68

Income from investment operations:
Net investment loss		(0.10	)
Net realized and unrealized gains (losses) on investments		0.01
Total from investment operations		(0.09	)
Paid-in capital from redemption fees		—
Net asset value, end of period	$	13.59

TOTAL RETURN		(0.66	)%(4)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	1.22
Ratio of expenses to average net assets:
Before expense reimbursement		2.67	%(5)
After expense reimbursement		1.70	%(5)
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement		(2.42	)%(5)
After expense reimbursement		(1.45	)%(5)
Portfolio turnover rate(6)		99	%(4)

(1)	Institutional Class shares commenced operations on March 12, 2010.
(2)	Calculated based on average shares outstanding method.
(3)	Amount is less than $0.01.
(4)	Not annualized.
(5)	Annualized.
(6)	Portfolio turnover is calculated on the basis of the Fund as a whole.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

									Period Ended
For the Year Ended October 31,									October 31,
2013			2012			2011			2010(1)

$	10.73		$	10.89		$	11.00		$	10.46


	(0.12	)		(0.11	)		(0.14	)(2)		(0.07	)
	3.07			(0.05	)		0.03			0.61
	2.95			(0.16	)		(0.11	)		0.54
	—			0.00	(3)		0.00	(3)		0.00	(3)
$	13.68		$	10.73		$	10.89		$	11.00

	27.49	%		(1.47	)%		(1.00	)%		5.16	%(4)


$	1.19		$	0.93		$	1.16		$	4.61

	2.76	%		4.11	%		3.45	%		2.34	%(5)
	1.70	%		1.70	%		1.70	%		1.70	%(5)

	(2.10	)%		(3.31	)%		(2.99	)%		(1.41	)%(5)
	(1.04	)%		(0.90	)%		(1.24	)%		(0.77	)%(5)
	164	%		138	%		141	%		353	%(4)

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Technology Fund (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund is a successor to the FBR Technology Fund (the “Predecessor FBR Fund”), a series of The FBR Funds, a Delaware statutory trust, pursuant to a reorganization that took place after the close of business on October 26, 2012. Prior to October 26, 2012, the Fund had no investment operations. As a result of the reorganization, holders of the Investor Class shares of the Predecessor FBR Fund received Investor Class shares of the Fund (the Investor Class shares of the Fund are the successor to the accounting and performance information of the Predecessor FBR Fund), and holders of the Institutional Class shares of the Predecessor FBR Fund received Institutional Class shares of the Fund (the Institutional Class shares of the Fund are the successor to the accounting and performance information of the Predecessor FBR Fund). The investment objective of the Fund is capital appreciation. The Fund is a non-diversified fund.

2). SIGNIFICANT ACCOUNTING POLICIES

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis. The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees. Income,

HENNESSYFUNDS.COM

	expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its respective net assets.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out annually, usually in November or December. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the 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. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.

HENNESSY FUNDS 1-800-966-4354

	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions and concluded that there is no impact on the Fund’s net assets and no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

Level 1 –

Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.

HENNESSYFUNDS.COM

	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.
	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

The Board of Trustees of the Fund (the “Board”) has adopted fair value pricing procedures that are followed when a price for a security is not readily available or if a

HENNESSY FUNDS 1-800-966-4354

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $6,602,649 and $6,031,541, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund for the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

HENNESSYFUNDS.COM

For a period of three years after the year in which the Advisor waives or reimburses expenses, the Advisor may seek reimbursement from the Fund to the extent that total annual fund operating expenses are less than the expense limitation in effect at the time of the reimbursement. The Advisor waived or reimbursed expenses of $32,139 for the Fund during the six-month period ended April 30, 2014. As of April 30, 2014, cumulative expenses subject to potential recovery to the aforementioned conditions and year of expiration are as follows:

	October 31, 2015		October 31, 2016		October 31, 2017		Total
Investor Class	$	619	$	48,568	$	25,872	$	75,059
Institutional Class	$	151	$	10,931	$	6,267	$	17,349

The Fund has adopted a plan pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended, that authorizes payments in connection with the distribution of the Fund’s shares at an annual rate of up to 0.25% of the Fund’s average daily net assets attributable to Investor Class shares. Amounts paid under the plan may be spent on any activities or expenses primarily intended to result in the sale of shares, including but not limited to, advertising, compensation for sales and marketing activities or financial institutions and others such as dealers and distributors, shareholder account servicing, the printing and mailing of prospectuses to other than current shareowners, and the printing and mailing of sales literature.

6). LINE OF CREDIT

The Fund has a line of credit with the other funds in the Hennessy Funds family of funds (the “Hennessy Funds”) in the amount of the lesser of (i) $100,000,000 or (ii) 33.33% of

HENNESSY FUNDS 1-800-966-4354

each Hennessy Fund’s net assets, or 30% for the Hennessy Gas Utility Index Fund and 10% for the Hennessy Balanced Fund, intended to provide short-term financing, if necessary, subject to certain restrictions, in connection with shareholder redemptions. The credit facility is with the Hennessy Funds’ custodian bank, U.S. Bank, N.A. Borrowings under this arrangement bear interest at the bank’s prime rate. During the six months ended April 30, 2014, the Fund did not have any borrowings outstanding under the line of credit.

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	4,760,318
Gross tax unrealized appreciation	$	964,717
Gross tax unrealized depreciation		(83,425	)
Net tax unrealized appreciation/depreciation	$	881,292
Undistributed ordinary income	$	—
Undistributed long-term capital gains		—
Total distributable earnings	$	—
Other accumulated gain (loss)	$	(1,823,060	)
Total accumulated gain (loss)	$	(941,768	)

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had capital loss carryforwards that expire as follows:

$1,757,171

10/31/17

During the year ended October 31, 2013, the Fund’s most recent fiscal year end, the capital loss carry forwards utilized for the Fund were $448,592.

At October 31, 2013, the Fund deferred, on a tax basis, a post-December late year ordinary loss deferral of $(65,889) and did not defer, on a tax basis, any post-December loss deferrals.

The Fund did not pay any distributions during fiscal year 2014 (year-to-date) or fiscal year 2013.

HENNESSYFUNDS.COM

Expense Example (Unaudited)

April 30, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$ 991.90	$9.63

Hypothetical (5% return
before expenses)	$1,000.00	$1,015.12	$9.74

Institutional Class

Actual	$1,000.00	$ 993.40	$8.40

Hypothetical (5% return
before expenses)	$1,000.00	$1,016.36	$8.50

(1)	Expenses are equal to the Fund’s annualized expense ratio of 1.95% for Investor Class shares or 1.70% for Institutional Class shares, as applicable, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

HENNESSYFUNDS.COM

Proxy Voting

Quarterly Filings on Form N-Q

Householding

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreement

At its meeting on March 3, 2014, the Board of Trustees of the Fund (the “Board”) unanimously approved the continuation of the investment advisory agreement of the Fund.

•

The Board considered the services identified below that are provided by the Advisor:

		•	The Advisor acts as portfolio manager for the Fund. In this capacity, the Advisor manages the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
		•	The Advisor performs daily reconciliations of portfolio positions and cash for the Fund.
		•	The Advisor manages the use of soft dollars for the Fund.
		•	The Advisor monitors compliance by the Fund with its investment objectives and restrictions.
		•	The Advisor monitors compliance with federal securities laws and performs activities such as maintaining a compliance program, conducting ongoing reviews of the compliance programs of the Fund’s service providers, conducting on-site visits to the Fund’s service providers, monitoring incidents of abusive trading practices, reviewing Fund expense accruals, payments, and fixed expense ratios, evaluating insurance providers for fidelity bond coverage and D&O/E&O insurance coverage, conducting employee compliance training, reviewing reports provided by service providers, maintaining books and records, and preparing an annual compliance report to the Board.
		•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, custodial, sales and marketing, audit, information technology, and legal services.
		•	The Advisor maintains an in-house public relations and marketing department on behalf of the Fund.
		•	The Advisor is actively involved with preparing regulatory filings for the Fund.
		•	The Advisor manages proxy voting for the Fund.
		•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab, Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund,

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			which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
		•	The Advisor pays the incentive compensation of all of the Fund’s compliance officers and employs other staff such as management executives, legal personnel, marketing personnel, national accounts and distribution personnel, sales personnel, and trading oversight personnel.
		•	The Advisor prepares or reviews Board materials, frequently presents to the Board or leads Board discussions, prepares or reviews meeting minutes, and arranges for Board training and education.

	•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the continuation of the advisory agreement.
	•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
	•	The Board considered the fees charged by the Advisor to those of funds similar in asset size and investment objective to the Fund and concluded the advisory fee of the Fund was reasonable and warranted continuation of the advisory agreement. The Trustees noted that the investment advisory fees are not adjusted if economies of scale are realized as the Fund grows because many of the expenses incurred by the Advisor to manage the Fund are asset-based fees and thus do not result in material economies of scale being realized as the net assets of the Fund increase.
	•	The Board considered the profitability of the Advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
	•	The Board considered the high level of professionalism and knowledge of the Advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

HENNESSY FUNDS 1-800-966-4354

For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

Tait, Weller & Baker LLP

1818 Market Street, Suite 2400

Philadelphia, Pennsylvania 19103

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY JAPAN FUND

Investor Class HJPNX

Institutional Class HJPIX

hennessyfunds.com | 1-800-966-4354

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Contents

Letter to Shareholders	2
Performance Overview	4
Financial Statements
Schedule of Investments	6
Statement of Assets and Liabilities	10
Statement of Operations	11
Statements of Changes in Net Assets	13
Financial Highlights	14
Notes to the Financial Statements	18
Expense Example	25
Proxy Voting	27
Quarterly Filings on Form N-Q	27
Householding	27
Board Approval of Investment Advisory Agreements	28

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

As we review the first half of the year, we continue to see the same trends as in the recent past, with corporations in both Japan and the U.S. driving shareholder value by making acquisitions, initiating and raising dividends, investing in internal infrastructure, and buying back stock. In fact, the total amount of dividends paid by Japanese companies reached a historic high over the twelve months ended March 31, 2013. I believe we will likely see continued dividend increases from cash-rich companies, and we may also begin to see these firms initiate capital expenditure programs.

Up until this point, there has been no real cost for firms to defer spending, but I do believe there will now be companies that want to improve their margins and will begin spending money to expand their revenue, and may even begin to hire. Once a competitor begins to move in this way, then the cost to defer becomes real for companies. This movement to expansion may well be a catalyst to propel the financial markets. With almost $3 trillion in cash sitting on the sidelines in the U.S. alone, it should help the economic recovery here in the U.S. for companies to begin spending their idle capital, which will likely have ripple effects to the Japan market and beyond.

The Japan financial markets were volatile over the past six months ended April 30, 2014, with the Tokyo Price Index, or TOPIX, falling -5.41% (in U.S. Dollar terms) during the period. While the Japanese market started the period on a positive note as a result of constructive economic developments in Japan and overseas, the market recorded negative returns for the overall six-month period ended April 30, 2014. This was due in large part to profit taking by investors following the surging Japanese market in 2013, and also due to concerns over the economies of developing countries and the instability of their currencies, the appreciation of the yen, growing tensions in Ukraine, and the volatile global economy.

On April 1, Japan’s long-anticipated consumption tax increase took effect, raising the tax by three percent to eight percent. Initial reports suggest that the impact from the rise in taxes has been muted, which has put investors’ minds at ease. Longer term economic indicators suggest that the benefits of Prime Minister Abe’s aggressive monetary and fiscal policies, referred to as “Abenomics,” are spreading and gaining traction. While many investors may now have concerns about the third arrow of Abenomics, which is the growth strategy, I believe that cyclical recovery will continue in Japan for the next few years with or without the growth strategy. Corporate balance sheets were strengthened significantly over recent years, which allowed Japanese companies to stay competitive at much higher currency rates, and I believe Japanese corporations will likely maintain their growth momentum irrespective of any future movement of the yen. With favorable top line and bottom line results, I expect many companies to further grow their cash flow, which can stimulate future capital expenditures and which is sorely needed following two decades of underinvestment. The trickle-down effect should benefit many domestic Japanese industries and has the potential to create a positive economic cycle for years to come.

I believe that Japanese investors, including pensions and individuals, will finally start investing in the domestic equity market, which should support the normalization of the valuation of the Japanese equity market and undervalued names. The Japanese private sector is holding historically high financial assets, with cash and cash deposits held by corporations and individuals at $2.1 trillion and $8.7 trillion, respectively. This money on

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the sidelines represents approximately two times the size of Japan’s total equity market cap. This liquidity has never been invested, which was a smart decision made by investors in the deflationary environment of the past.

The Japanese government is creating a private pension plan modeled on the Individual Retirement Account, or IRA, in the U.S. IRAs were introduced in the U.S. in 1974 to encourage individuals to invest by introducing tax breaks. Assets in U.S. IRA accounts grew 80-fold over 20 years, from $6.8 billion in 1980 to $5.4 trillion in 2010. In 1980, bank deposits accounted for 82% of U.S. IRA assets, and today they account for just 10%. In 1980, mutual funds accounted for just 3% of U.S. IRA assets, and today they account for 46%. With this new government program, I strongly believe that a large structural shift from bank deposits into equities is likely to occur in Japan, much like it did in the U.S. This in turn should help to drive the growth of the Japanese equity markets.

I am confident that even with all the hurdles facing corporations both in the U.S. and Japan, companies will continue to provide value for their shareholders. To me, that means the financial markets are in good shape and should remain strong moving forward. I also believe that the next few months may be volatile for the worldwide economy and the financial markets. After over 35 years in the business, I still firmly believe the best way to position your portfolio is by investing in good companies over the long term, rather than trying to buy the next hot idea at exactly the right time. At Hennessy Funds, hunches and fads have no place in our investment process, and we understand that successful investing comes from time in the market, not timing the market.

Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Tokyo Price Index (TOPIX) is a market capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. One cannot invest directly in an index.

Cash flow can be used as an indication of a company’s financial strength and represents earnings before depreciation, amortization, and non-cash charges.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014

	Six	One	Five	Ten
	Months(1)	Year	Years	Years
Hennessy Japan Fund –
Investor Class (HJPNX)	-1.47%	5.21%	15.57%	4.18%
Hennessy Japan Fund –
Institutional Class (HJPIX)	-1.35%	5.51%	15.83%	4.36%
Russell/Nomura Total MarketTM Index	-5.27%	-2.70%	8.15%	2.52%
Tokyo Price Index (TOPIX)	-5.41%	-3.08%	8.27%	2.35%

Expense ratios: 1.91% (Investor Class); 1.67% (Institutional Class)

The expense ratios presented are from the most recent prospectus.

(1)	Periods less than one year are not annualized.

PERFORMANCE NARRATIVE

SPARX ASSET MANAGEMENT CO., LTD, SUB-ADVISOR

Portfolio Managers: Masakazu Takeda, CMA, and Yu Shimizu, CMA, SPARX Asset Management Co., Ltd. (sub-advisor)

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Investor Class of the Hennessy Japan Fund returned -1.47%, significantly outperforming the Russell/Nomura Total Market™ Index, the Tokyo Price Index (TOPIX), and the Morningstar Japan Category Average, which returned -5.27%, -5.41%, and -4.31% for the same period, respectively.

The largest positive contributors to the Fund’s performance among the 33 TOPIX sub-industries were shares of chemical manufacturers, miscellaneous manufacturing firms, and retailers. Conversely, shares of wholesalers, banks, and precision instrument makers performed negatively during the six-month period.

Among the strongest performing stocks in the Fund during the period were Rohto Pharmaceutical Co., Ltd., the leading over-the-counter ophthalmic medicines and skincare cosmetics producer, Nidec Corporation, the world’s major electric motor manufacturer, and Ryohin Keikaku Co., Ltd., the operator of the MUJI brand retail chain store. Shares of both Rohto Pharmaceutical Co., Ltd. and Nidec Corporation jumped over 28% and 24%, respectively, following strong earnings results for the fourth quarter of

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calendar year 2013. The market also welcomed Nidec Corporation’s upward revision of its full-year earnings guidance for its fiscal year ended March 31, 2014. Finally, shares of Ryohin Keikaku Co., Ltd. surged 18% due to the solid earnings announcement for its fiscal year ended February 28, 2014, and the upbeat guidance for the new fiscal year. The Fund continues to hold all of these positions.

Conversely, Terumo Medical Corporation, Japan’s largest medical device manufacturer, MISUMI Group, Inc., the maker and distributor of metal mold components and precision machinery parts, and Unicharm Corporation, the baby and feminine care products maker, were among the major detractors from the Fund’s performance. Shares of Terumo Medical Corporation fell 13% following its third quarter earnings announcement for its fiscal year ended March 31, 2014, as investors were disappointed with the decline in sales. Shares of MISUMI Group, Inc. declined 11% on what we believe was the market’s growing concern over its outlook for fiscal year 2014. Lastly, shares of Unicharm Corporation fell 8% as the perception of an intensifying competitive landscape became widely recognized by investors.

Additional Portfolio Manager commentary and related investment outlook:

Going forward, we will continue to increase our exposure to companies with a distinct manufacturing edge, high-quality craftsmanship, energy-efficient technologies, or a superior brand image that may benefit from the growing demand from the economies of developed and emerging countries. We will also continue to favor general trading firms that span those technologies to the emerging nations.

The Russell/Nomura Total Market™ Index contains the top 98% of all stocks listed on Japan’s stock exchange and registered on Japan’s OTC market in terms of market capitalization. The Tokyo Price Index (TOPIX) is a market capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. The Russell/Nomura Total Market™ and TOPIX indices are presented in U.S. dollar terms and take into account reinvestment of dividends. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund may invest in small- and medium capitalization companies, which may have limited liquidity and greater price volatility than large-capitalization companies. Investments in foreign securities involve greater volatility and political, economic and currency risk and differences in accounting methods. The Fund may invest in IPOs, which may fluctuate considerably due to the absence of a prior public market and may have a magnified impact on the Fund. References to specific securities should not be considered a recommendation to buy or sell any security. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

HENNESSY FUNDS 1-800-966-4354

Schedule of Investments

HENNESSY JAPAN FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Ryohin Keikaku Co., Ltd.	6.57%
	Kao Corp.	6.39%
	Asics Corp.	5.93%
	Nidec Corp.	5.79%
	Rohto Pharmaceutical Co., Ltd.	5.77%
	Fuji Seal International, Inc.	5.46%
	Unicharm Corp.	5.44%
	Shimano, Inc.	5.42%
	Isuzu Motors, Ltd.	5.17%
	Keyence Corp.	5.10%

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COMMON STOCKS – 98.62%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 27.95%
Asics Corp.		115,200	$	2,242,177		5.93	%
Isuzu Motors, Ltd.		337,000		1,957,145		5.17	%
Ryohin Keikaku Co., Ltd.		22,100		2,483,674		6.57	%
Shimano, Inc.		20,500		2,049,217		5.42	%
Toyota Motor Corp.		34,000		1,836,958		4.86	%
				10,569,171		27.95	%

Consumer Staples – 15.16%
Kao Corp.		64,200		2,416,964		6.39	%
Pigeon Corp.		28,100		1,258,067		3.33	%
Unicharm Corp.		37,900		2,055,243		5.44	%
				5,730,274		15.16	%

Financials – 6.90%
Mizuho Financial Group		503,200		985,571		2.60	%
Sumitomo Mitsui Financial Group, Inc.		41,100		1,624,696		4.30	%
				2,610,267		6.90	%

Health Care – 11.18%
Mani, Inc.		6,900		308,664		0.81	%
Rohto Pharmaceutical Co., Ltd.		123,600		2,180,492		5.77	%
Terumo Corp.		87,600		1,738,477		4.60	%
				4,227,633		11.18	%

Industrials – 26.87%
Daikin Industries		17,100		989,135		2.61	%
Itochu Corp.		40,500		453,997		1.20	%
Komatsu, Ltd.		7,500		165,122		0.44	%
Kubota Corp.		36,000		463,987		1.23	%
Marubeni Corp.		63,000		420,992		1.11	%
Misumi Group, Inc.		72,400		1,761,798		4.66	%
Mitsubishi Corp.		105,800		1,894,593		5.01	%
Nidec Corp.		38,700		2,187,924		5.79	%
Sumitomo Corp.		140,500		1,823,758		4.82	%
				10,161,306		26.87	%

Information Technology – 5.10%
Keyence Corp.		5,000		1,928,808		5.10	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Materials – 5.46%
Fuji Seal International, Inc.		63,400	$	2,062,784		5.46	%

Total Common Stocks
(Cost $28,238,389)				37,290,243		98.62	%

SHORT-TERM INVESTMENTS – 0.79%

Money Market Funds – 0.79%
Fidelity Government Portfolio –
Institutional Class, 0.01% (a)		299,418		299,418		0.79	%

Total Money Market Funds
(Cost $299,418)				299,418		0.79	%

Total Short-Term Investments
(Cost $299,418)				299,418		0.79	%

Total Investments
(Cost $28,537,807) – 99.41%				37,589,661		99.41	%
Other Assets in Excess
of Liabilities – 0.59%				222,717		0.59	%
TOTAL NET ASSETS – 100.00%			$	37,812,378		100.00	%

Percentages are stated as a percent of net assets.

(a)	The rate listed is the fund’s 7-day yield as of April 30, 2014.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	—	$	10,569,171	$	—	$	10,569,171
Consumer Staples		—		5,730,274		—		5,730,274
Financials		—		2,610,267		—		2,610,267
Health Care		—		4,227,633		—		4,227,633
Industrials		—		10,161,306		—		10,161,306
Information Technology		—		1,928,808		—		1,928,808
Materials		—		2,062,784		—		2,062,784
Total Common Stock	$	—	$	37,290,243	$	—	$	37,290,243
Short-Term Investments
Money Market Funds	$	299,418	$	—	$	—	$	299,418
Total Short-Term Investments	$	299,418	$	—	$	—	$	299,418
Total Investments	$	299,418	$	—	$	—	$	37,589,661

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized significant transfers between Levels 1 and 2.

Transfers between Level 1 and Level 2 relate to the use of a fair valuation pricing service. On days when the fair valuation pricing service is used, non-U.S. dollar denominated securities move from a Level 1 to a Level 2 classification.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $28,537,807)	$	37,589,661
Dividends and interest receivable		312,342
Receivable for fund shares sold		14,879
Prepaid expenses and other assets		21,743
Total Assets		37,938,625

LIABILITIES:
Payable for fund shares redeemed		37,028
Payable to advisor		37,237
Payable to administrator		15,875
Payable to auditor		12,461
Accrued service fees		2,707
Accrued interest payable		2,241
Accrued trustees fees		5,011
Accrued expenses and other payables		13,687
Total Liabilities		126,247
NET ASSETS	$	37,812,378

NET ASSETS CONSIST OF:
Capital stock	$	62,237,205
Accumulated net investment loss		(147,266	)
Accumulated net realized loss on investments		(33,328,595	)
Unrealized net appreciation on investments		9,051,034
Total Net Assets	$	37,812,378

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		25,539,038
Shares issued and outstanding		1,316,963
Net asset value, offering price and redemption price per share	$	19.39

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares		12,273,340
Shares issued and outstanding		622,737
Net asset value, offering price and redemption price per share	$	19.71

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income(1)	$	355,463
Interest income		123
Total investment income		355,586

EXPENSES:
Investment advisory fees		224,059
Administration, fund accounting, custody and transfer agent fees		44,812
Sub-transfer agent expenses – Investor Class (See Note 5)		32,102
Sub-transfer agent expenses – Institutional Class (See Note 5)		3,025
Federal and state registration fees		17,566
Service fees – Investor Class (See Note 5)		16,905
Compliance expense		10,655
Audit fees		10,563
Trustees’ fees and expenses		6,943
Reports to shareholders		5,997
Legal fees		2,480
Interest expense (See Note 6)		2,222
Other expenses		5,073
Total expenses		382,402
NET INVESTMENT LOSS	$	(26,816	)

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	13,191
Change in unrealized appreciation on investments		(826,729	)
Net loss on investments		(813,538	)
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	(840,354	)

(1)	Net of foreign taxes withheld of $64,067.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

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HENNESSYFUNDS.COM

Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment loss	$	(26,816	)	$	(84,313	)
Net realized gain on securities		13,191			16,814
Change in unrealized appreciation (depreciation)
on securities		(826,729	)		6,419,308
Net increase (decrease) in net assets
resulting from operations		(840,354	)		6,351,809

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Return of capital
Investor Class		—			(7,343	)
Institutional Class		—			(5,524	)
Total distributions		—			(12,867	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		17,775,299			34,783,512
Proceeds from shares subscribed – Institutional Class		4,342,557			2,373,930
Dividends reinvested – Investor Class		—			7,134
Dividends reinvested – Institutional Class		—			5,425
Cost of shares redeemed – Investor Class		(22,908,201	)		(18,430,840	)
Cost of shares redeemed – Institutional Class		(949,957	)		(4,003,290	)
Net increase (decrease) in net assets
derived from capital share transactions		(1,740,302	)		14,735,871
TOTAL INCREASE (DECREASE) IN NET ASSETS		(2,580,656	)		21,074,813

NET ASSETS:
Beginning of period		40,393,034			19,318,221
End of period	$	37,812,378		$	40,393,034
Undistributed net investment loss, end of period	$	(147,266	)	$	(120,450	)

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		910,717			1,961,023
Shares sold – Institutional Class		217,260			126,165
Shares issued to holders as reinvestment
of dividends – Investor Class		—			459
Shares issued to holders as reinvestment
of dividends – Institutional Class		—			344
Shares redeemed – Investor Class		(1,185,350	)		(1,043,924	)
Shares redeemed – Institutional Class		(48,640	)		(245,080	)
Net increase (decrease) in shares outstanding		(106,013	)		798,987

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Japan Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	19.68

Income from investment operations:
Net investment income (loss)		(0.04	)
Net realized and unrealized gains (losses) on securities		(0.25	)
Total from investment operations		(0.29	)

Less distributions:
Dividends from net investment income		—
Return of capital		—
Total distributions		—
Paid-in capital from redemption fees		—
Net asset value, end of period	$	19.39

TOTAL RETURN		(1.47	)%(3)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	25.54
Ratio of expenses to average net assets:
Before expense reimbursement		1.76	%(4)
After expense reimbursement		1.76	%(4)
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement		(0.19	)%(4)
After expense reimbursement		(0.19	)%(4)
Portfolio turnover rate(5)		21	%(3)

(1)	The financial highlights set forth for periods prior to September 17, 2009 represent the historical financial highlights of the SPARX Japan Fund. On September 17, 2009, Hennessy Advisors, Inc. became the investment advisor to the Fund and the Fund changed its name to Hennessy Select SPARX Japan Fund. In October 2012, the Fund changed its name to Hennessy Japan Fund.
(2)	Amount is less than $0.01.
(3)	Not annualized.
(4)	Annualized.
(5)	Portfolio turnover is calculated on the basis of the Fund as a whole.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Year Ended October 31,
2013			2012			2011			2010			2009(1)

$	15.40		$	13.99		$	12.58		$	11.38		$	9.73


	(0.04	)		(0.02	)		(0.10	)		(0.04	)		0.02
	4.33			1.43			1.51			1.25			1.66
	4.29			1.41			1.41			1.21			1.68


	—			—			—			(0.01	)		(0.03	)
	(0.01	)		—			—			(0.01	)		—
	(0.01	)		—			—			(0.02	)		(0.03	)
	—			—			—			0.01			0.00	(2)
$	19.68		$	15.40		$	13.99		$	12.58		$	11.38

	27.87	%		10.08	%		11.21	%		11.04	%		17.36	%


$	31.32		$	10.38		$	14.81		$	20.01		$	28.29

	1.90	%		2.03	%		1.86	%		1.71	%		1.75	%
	1.90	%		2.03	%		1.86	%		1.59	%		1.24	%

	(0.35	)%		(0.09	)%		(0.54	)%		(0.27	)%		(0.34	)%
	(0.35	)%		(0.09	)%		(0.54	)%		(0.15	)%		0.17	%
	6	%		2	%		166	%		8	%		17	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Japan Fund

For an Institutional Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	19.98

Income from investment operations:
Net investment income (loss)		0.02
Net realized and unrealized gains (losses) on securities		(0.29	)
Total from investment operations		(0.27	)

Less distributions:
Dividends from net investment income		—
Return of capital		—
Total distributions		—
Paid-in capital from redemption fees		—
Net asset value, end of period	$	19.71

TOTAL RETURN		(1.35	)%(3)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	12.27
Ratio of expenses to average net assets:
Before expense reimbursement		1.54	%(4)
After expense reimbursement		1.54	%(4)
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement		0.08	%(4)
After expense reimbursement		0.08	%(4)
Portfolio turnover rate(5)		21	%(3)

(1)	The financial highlights set forth for periods prior to September 17, 2009 represent the historical financial highlights of the SPARX Japan Fund. On September 17, 2009, Hennessy Advisors, Inc. became the investment advisor to the Fund and the Fund changed its name to Hennessy Select SPARX Japan Fund. In October 2012, the Fund changed its name to Hennessy Japan Fund.
(2)	Amount is less than $0.01.
(3)	Not annualized.
(4)	Annualized.
(5)	Portfolio turnover is calculated on the basis of the Fund as a whole.

The accompanying notes are an integral part of these financial statements.

HENNESSYFUNDS.COM

Year Ended October 31,
2013			2012			2011			2010			2009(1)

$	15.60		$	14.14		$	12.66		$	11.44		$	9.78


	(0.03	)		0.02			0.03			0.01			0.03
	4.42			1.44			1.45			1.23			1.66
	4.39			1.46			1.48			1.24			1.69


	—			—			—			(0.01	)		(0.03	)
	(0.01	)		—			—			(0.01	)		—
	(0.01	)		—			—			(0.02	)		(0.03	)
	—			—			—			—			0.00	(2)
$	19.98		$	15.60		$	14.14		$	12.66		$	11.44

	28.19	%		10.33	%		11.69	%		11.07	%		17.37	%


$	9.07		$	8.94		$	9.70		$	23.57		$	25.55

	1.66	%		1.85	%		1.64	%		1.45	%		1.75	%
	1.66	%		1.85	%		1.64	%		1.40	%		1.24	%

	(0.20	)%		0.13	%		0.19	%		0.02	%		(0.34	)%
	(0.20	)%		0.13	%		0.19	%		0.07	%		0.17	%
	6	%		2	%		166	%		8	%		17	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Japan Fund (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund is a successor to a fund with the same name (the “Predecessor Fund”) that was a series of Hennessy SPARX Funds Trust, a Massachusetts business trust, pursuant to a reorganization that took place after the close of business on February 28, 2014. Prior to February 28, 2014, the Fund had no investment operations. As a result of the reorganization, holders of the Investor Class shares of the Predecessor Fund received Investor Class shares of the Fund (the Investor Class shares of the Fund are the successor to the accounting and performance information of the Predecessor Fund), and holders of the Institutional Class shares of the Predecessor Fund received Institutional Class shares of the Fund (the Institutional Class shares of the Fund are the successor to the accounting and performance information of the Predecessor Fund). The investment objective of the Fund is long-term capital appreciation. The Fund is a diversified fund, but may employ a relatively focused investment strategy and may hold securities of fewer issuers than other diversified funds.

2). SIGNIFICANT ACCOUNTING POLICIES

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis.

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	The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its respective net assets.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out annually, usually in November or December. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the 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. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies, if any, are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.

HENNESSY FUNDS 1-800-966-4354

	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions and concluded that there is no impact on the Fund’s net assets and no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

	Level 1 –	Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.

	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in

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		markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.

	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

HENNESSY FUNDS 1-800-966-4354

with direct bearing to security or market. Fair value pricing results in an estimated price that reasonably reflects the current market conditions in order to rate the portfolio holdings such that shareholder transactions receive a fair net asset value. Depending on the relative significance of the valuation inputs, these securities may be classified in either Level 2 or Level 3 of the fair value hierarchy.

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $8,608,506 and $9,037,801, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund during the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Hennessy Advisors, Inc. (the “Advisor”) is the investment advisor of the Fund. The Advisor provides the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnishes 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 from the Fund. The fee is based upon the average daily net assets of the Fund at the annual rate of 1.00%. The net investment advisory fees payable for the Fund as of April 30, 2014 were $37,237.

The Advisor has delegated the day-to-day management of the Fund to a sub-advisor, SPARX Asset Management Co., Ltd. The Advisor pays the sub-advisor fees for the Fund from its own assets and these fees are not an additional expense of the Fund.

The Board has approved a Shareholder Servicing Agreement for the Investor Class shares of the Fund, which was instituted to compensate the Advisor for the non-

HENNESSYFUNDS.COM

6). LINE OF CREDIT

The Fund has a line of credit with the other funds in the Hennessy Funds family of funds (the “Hennessy Funds”) in the amount of the lesser of (i) $100,000,000 or (ii) 33.33% of each Hennessy Fund’s net assets, or 30% for the Hennessy Gas Utility Index Fund and 10% for the Hennessy Balanced Fund, intended to provide short-term financing, if necessary, subject to certain restrictions, in connection with shareholder redemptions. The credit facility is with the Hennessy Funds’ custodian bank, U.S. Bank, N.A. Borrowings under this arrangement bear interest at the bank’s prime rate. During the six months ended April 30, 2014, the Fund had an outstanding average daily balance and a weighted average interest rate of $314,934 and 3.25%, respectively. The maximum amount outstanding for the Fund during the period was $8,288,000.

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	30,288,033
Gross tax unrealized appreciation	$	10,246,685
Gross tax unrealized depreciation		(418,275	)
Net tax unrealized appreciation/depreciation	$	9,828,410
Undistributed ordinary income	$	—
Undistributed long-term capital gains		—
Total distributable earnings	$	—
Other accumulated gain (loss)	$	(33,412,883	)
Total accumulated gain (loss)	$	(23,584,473	)

HENNESSY FUNDS 1-800-966-4354

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had capital loss carryforwards that expire as follows:

$	4,786,618	10/31/15
$	6,231,544	10/31/16
$	15,450,664	10/31/17
$	6,121,138	10/31/18
$	362,390	Indefinite ST
$	340,146	Indefinite LT

During the year ended October 31, 2013, the Fund’s most recent fiscal year end, the capital loss carry forwards utilized for the Fund were $812,229.

At October 31, 2013, the Fund deferred, on a tax basis, a post-December late year ordinary loss deferral and a post-December loss deferral of $(120,450) and did not defer, on a tax basis, any post-December loss deferrals.

The tax character of distributions paid during fiscal year 2014 (year-to-date) and fiscal year 2013 for the Fund were as follows:

	Six Months Ended		Year Ended
	April 30, 2014		October 31, 2013
Ordinary income	$	—	$	—
Long-term capital gain		—		—
Return of capital		—		12,867
	$	—	$	12,867

8). AGREEMENT AND PLAN OF REORGANIZATION

On December 11, 2013, the Board approved an Agreement and Plan of Reorganization (the “Agreement”), of the Hennessy Japan Fund (the “New Fund”), pursuant to which the New Fund would be a successor to the corresponding series of the same name Hennessy SPARX Funds Trust, a Massachusetts business trust (the “Predecessor Fund”). The Agreement provided for the transfer of assets of the Predecessor Fund to the New Fund and the assumption of the liabilities of the Predecessor Fund by the New Fund. The New Fund had the same investment objective and substantially similar principal investment strategies as the Predecessor Fund. The reorganization was effective as of the close of business on February 28, 2014. The following table illustrates the specifics of the reorganization:

	Shares of the New Fund
Predecessor Fund	Issued to Shareholders of	New Fund	Combined	Tax Status
Net Assets	the Predecessor Fund	Net Assets	Net Assets	of Transfer
$48,645,944(1)	2,463,074	$48,645,944	$48,645,944	Non-taxable

(1)

Included accumulated realized loss and unrealized appreciation in the amounts of $(33,440,043) and $9,954,834, respectively.

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Expense Example (Unaudited)

April 30, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$ 985.30	$8.66

Hypothetical (5% return
before expenses)	$1,000.00	$1,016.07	$8.80

Institutional Class

Actual	$1,000.00	$ 986.50	$7.59

Hypothetical (5% return
before expenses)	$1,000.00	$1,017.16	$7.70

(1)	Expenses are equal to the Fund’s annualized expense ratio of 1.76% for Investor Class shares or 1.54% for Institutional Class shares, as applicable, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

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Proxy Voting

Quarterly Filings on Form N-Q

Householding

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreements

At its meeting on December 4, 2013, the Board of Trustees of the Fund (the “Board”) unanimously approved the investment advisory agreement and sub-advisory agreement of the Fund for an initial period of two years.

The Board reviewed a number of documents, including a memorandum provided by outside legal counsel that described the fiduciary duties of the Board with respect to approving the investment advisory agreement and the relevant factors for consideration, the Advisor’s most recent Form 10-K, a completed questionnaire from the sub-advisor, copies of the advisory and sub-advisory agreements, a fund fact sheet, and peer expense and performance comparisons. The Board considered and discussed numerous factors, including the following:

•

The Board considered the services identified below that are provided by the Advisor and the sub-advisor:

		•	The sub-advisor acts as the portfolio manager to the Fund, managing the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
		•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab, Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund, which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
		•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, and custodial services.

	•	The Board considered that the advisory services to be provided by the Advisor and the sub-advisor are services required for the operation of the Fund.
	•	The Board considered the nature and quality of the advisory services offered by the Advisor and the sub-advisor to the Fund.
	•	The Board considered that the terms of the advisory and sub-advisory agreements are fair and reasonable.
	•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the approval of the advisory and sub-advisory agreements.
	•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
	•	The Board considered the fees charged by the Advisor to those of funds similar in asset size and investment objective to the Fund and concluded the advisory fee of the Fund was reasonable and warranted approval of the advisory and sub-advisory agreements.

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	•	The Board considered the profitability of the Advisor and the sub-advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
	•	The Board considered the high level of professionalism and knowledge of the Advisor’s and sub-advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

All of the factors above were considered separately by the Board, including the Trustees who are not “interested persons” (as defined in the Investment Company Act of 1940, as amended) of the Fund (the “Independent Trustees”) meeting in an executive session. The factors were viewed in their totality by the Board, with no single factor being the principal or determinative factor in the Board’s determination of whether to approve the advisory and sub-advisory agreements. Based on the factors discussed above, the Board, including all of the Independent Trustees, recommended approval of the advisory and sub-advisory agreements.

HENNESSY FUNDS 1-800-966-4354

For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

KPMG LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

SEMI-ANNUAL REPORT

APRIL 30, 2014

HENNESSY JAPAN SMALL CAP FUND

Investor Class HJPSX

hennessyfunds.com | 1-800-966-4354

(This Page Intentionally Left Blank.)

Contents

Letter to Shareholders	2
Performance Overview	4
Financial Statements
Schedule of Investments	6
Statement of Assets and Liabilities	11
Statement of Operations	12
Statements of Changes in Net Assets	13
Financial Highlights	14
Notes to the Financial Statements	16
Expense Example	23
Proxy Voting	25
Quarterly Filings on Form N-Q	25
Householding	25
Board Approval of Investment Advisory Agreements	26

HENNESSY FUNDS 1-800-966-4354

June 2014

Dear Shareholder:

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Best regards,

Neil J. Hennessy

President and Chief Investment Officer

Past performance does not guarantee future results.

Mutual fund investing involves risk. Principal loss is possible.

Opinions expressed are those of Neil Hennessy and are subject to change, are not guaranteed and should not be considered investment advice.

The Tokyo Price Index (TOPIX) is a market capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. One cannot invest directly in an index.

Cash flow can be used as an indication of a company’s financial strength and represents earnings before depreciation, amortization, and non-cash charges.

HENNESSY FUNDS 1-800-966-4354

Performance Overview (Unaudited)

AVERAGE ANNUAL TOTAL RETURN PERIODS ENDED APRIL 30, 2014*

				Since
	Six	One	Five	Inception
	Months(1)	Year	Years	(8/31/07)
Hennessy Japan Small Cap Fund –
Investor Class (HJPSX)	5.20%	8.73%	18.60%	7.82%
Russell/Nomura Small Cap Index	-3.56%	-1.74%	11.64%	3.05%
Tokyo Price Index (TOPIX)	-5.41%	-3.08%	8.27%	-0.89%

Expense ratio: 2.40%

The expense ratio presented is from the most recent prospectus.

(1) Periods less than one year are not annualized.

PERFORMANCE NARRATIVE

SPARX ASSET MANAGEMENT CO., LTD, SUB-ADVISOR

Portfolio Managers Tadahiro Fujimura, CFA and CMA, and Hidehiro Moriya, SPARX Asset Management Co., Ltd. (sub-advisor)

Over the previous six months, how did the Fund perform and what factors contributed to this performance?

For the six-month period ended April 30, 2014, the Hennessy Japan Small Cap Fund returned 5.20%, significantly outperforming the Russell/Nomura Small Cap™ Index, the Tokyo Price Index (TOPIX), and the Morningstar Japan Category Average, which returned -3.56%, -5.41%, and -4.31% for the same period, respectively.

The largest positive contributors to the Fund’s performance among the 33 TOPIX sub-industries were shares of electronic appliance makers, machinery manufacturers, and retailers. Conversely, shares of securities and commodities dealers, auto-related firms, and information and communication-related firms performed negatively.

Among the strongest performing stocks in the Fund were shares of Yamaichi Electronics Co., Ltd., a leading manufacturer of integrated circuit sockets, Bic Camera, Inc., the second largest consumer electronics retailer, and S Foods, Inc., a manufacturer and retailer of meat products. Yamaichi Electronics Co., Ltd. developed an ultra slim, multi-layer printed circuit board, which is 30% thinner than its existing product and will be adopted in smartphones. Shares of Yamaichi Electronics Co., Ltd. advanced over 68% on news that this product will be produced in large quantities beginning this fall. Shares of Bic Camera, Inc. surged over 54% due to firm sales even after the consumption tax hike in April. Shares of S Foods, Inc. jumped over 38% due to strong earnings results for its fiscal year ended February 28, 2014. The Fund no longer holds Yamaichi Electronics Co., Ltd.

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Conversely, the major detractors from the Fund’s performance were Tokai Tokyo Financial Holdings, Inc., a mid-sized securities firm, T.RAD Co., Ltd., a comprehensive manufacturer of heat exchangers, and Nichicon Corporation, a major global manufacturer of capacitors. Shares of Tokai Tokyo Financial Holdings, Inc. fell 16% on concerns over the decline in revenues from commissions, as the stock markets were sluggish. Shares of T.RAD Co., Ltd. fell 14% after the firm lowered its earnings forecast for its fiscal year ended March 31, 2014. Finally, shares of Nichicon Corporation fell 26% on concerns over the strong Yen’s negative impact on earnings for its fiscal year ending March 31, 2015. The Fund no longer owns T.RAD Co., Ltd. or Nichicon Corporation.

Additional Portfolio Manager commentary and related investment outlook:

As move into the second half of 2014, we will continue to invest primarily in companies with strong growth potential. In addition, we will also focus on consumption-related companies and real estate companies whose share prices have stagnated due to concerns about the negative impact of the consumption tax increase, which was implemented on April 1, 2014. Furthermore, we will weigh the benefits of investing in low liquidity stocks, because we expect retail investors to regain their appetite for investing in these companies.

The Russell/Nomura Small Cap™ Index contains the bottom 15% of the Russell/Nomura Total Market™ Index, which contains the top 98% of all stocks listed on Japan’s stock exchange and registered on Japan’s OTC market in terms of market capitalization. The Tokyo Price Index (TOPIX) is a market capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. The Russell/Nomura Small Cap™ and TOPIX indices are presented in U.S. dollar terms and take into account reinvestment of dividends. You cannot invest directly in an index. Performance data for an index does not reflect any deductions for fees, expenses or taxes. The Fund invests in small- and medium-capitalization companies, which may have limited liquidity and greater price volatility than large-capitalization companies. Investments in foreign securities involve greater volatility and political, economic and currency risk and differences in accounting methods. The Fund may invest in IPOs, which may fluctuate considerably due to the absence of a prior public market and may have a magnified impact on the Fund. References to specific securities should not be considered a recommendation to buy or sell any security. Fund holdings and sector allocations are subject to change. Please refer to the Schedule of Investments included in this report for additional portfolio information.

HENNESSY FUNDS 1-800-966-4354

Schedule of Investments

HENNESSY JAPAN SMALL CAP FUND

As of April 30, 2014 (Unaudited)

(% of Net Assets)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Bic Camera, Inc.	2.74%
	S Foods, Inc.	2.57%
	Sumida Corp.	2.50%
	Okamura Corp.	2.42%
	Information Services International – Dentsu, Ltd.	2.39%
	Fujibo Holdings, Inc.	2.31%
	Towa Corp.	2.24%
	Nittoku Engineering Co., Ltd.	2.18%
	SBS Holdings, Inc.	2.17%
	Seiren Co., Ltd.	2.16%

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COMMON STOCKS – 96.45%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 27.09%
Ahresty Corp.		35,000	$	297,932		1.91	%
Alpen Co., Ltd.		9,000		165,813		1.06	%
Bic Camera, Inc.		58,500		426,687		2.74	%
Doshisha Co., Ltd.		18,700		280,378		1.80	%
Eagle Industry Co.		15,000		237,417		1.52	%
Faltec Co., Ltd.		7,000		246,808		1.59	%
Fujibo Holdings, Inc.		156,000		359,128		2.31	%
Hagihara Industries, Inc.		8,800		116,489		0.75	%
Haseko Corp.		44,500		281,807		1.81	%
Komeri Co., Ltd.		12,000		324,939		2.09	%
Nissei Build Kogyo Co., Ltd.		140,000		315,781		2.03	%
Sankyo Seiko Co.		79,000		272,863		1.75	%
Seiren Co., Ltd.		40,100		336,925		2.16	%
SNT Corp.		61,100		245,667		1.58	%
Starts Corp., Inc.		12,000		151,762		0.97	%
Studio Alice Co., Ltd.		11,400		158,526		1.02	%
				4,218,922		27.09	%

Consumer Staples – 2.57%
S Foods, Inc.		30,000		400,405		2.57	%

Energy – 0.57%
Itochu Enex Co., Ltd.		15,900		89,275		0.57	%

Financials – 3.79%
The Tochigi Bank, Inc.		86,000		335,249		2.15	%
Tokai Tokyo Financial Holdings, Inc.		38,000		255,303		1.64	%
				590,552		3.79	%

Industrials – 32.48%
Anest Iwata Corp.		55,000		332,623		2.14	%
Central Glass Co., Ltd.		101,000		331,212		2.13	%
Hanwa Co., Ltd.		55,000		215,119		1.38	%
Hitachi Zosen Corp.		49,500		242,876		1.56	%
Japan Pulp & Paper Co., Ltd.		49,000		166,905		1.07	%
Kato Works Co., Ltd.		30,000		173,029		1.11	%
Kito Corp.		12,600		231,031		1.48	%
Kitz Corp.		65,900		311,185		2.00	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Industrials (Continued)
Kondotec, Inc.		35,700	$	243,942		1.57	%
Kyosan Electric Manufacturing Co., Ltd.		84,000		290,536		1.87	%
Miyaji Engineering Group, Inc.		120,000		267,859		1.72	%
Nittoku Engineering Co., Ltd.		39,500		340,294		2.18	%
Okamura Corp.		44,000		376,381		2.42	%
Prestige International, Inc.		23,700		222,419		1.43	%
SBS Holdings, Inc.		20,000		338,642		2.17	%
Shin Nippon Air Technologies Co., Ltd.		30,100		184,233		1.18	%
Teikoku Electric Manufacturing Co., Ltd.		5,600		159,527		1.02	%
Tocalo Co., Ltd.		19,900		311,115		2.00	%
Tomoe Engineering Co., Ltd.		20,200		318,605		2.05	%
				5,057,533		32.48	%

Information Technology – 22.49%
Aiphone Co., Ltd.		14,600		238,678		1.53	%
Asahi Net, Inc.		30,700		140,770		0.90	%
Dai-ichi Seiko Co.		25,000		317,839		2.04	%
Elecom Co., Ltd.		15,000		270,918		1.74	%
Hakuto Co., Ltd.		19,900		183,721		1.18	%
Information Services International – Dentsu, Ltd.		29,800		372,774		2.39	%
Iriso Electronics		4,500		226,498		1.46	%
Macnica, Inc.		5,400		160,116		1.03	%
Panasonic Industrial Devices SUNX Co., Ltd.		35,000		158,474		1.02	%
SIIX Corp.		13,900		204,110		1.31	%
Sumida Corp.		64,400		388,374		2.50	%
Towa Corp.		68,700		349,044		2.24	%
Transcosmos, Inc.		10,000		186,432		1.20	%
Yokowo Co., Ltd.		61,100		304,000		1.95	%
				3,501,748		22.49	%

Materials – 7.46%
Chuetsu Pulp & Paper Co., Ltd.		126,000		237,231		1.52	%
Daiken Corp.		100,000		244,621		1.57	%
Hakudo Co., Ltd.		18,000		157,293		1.01	%
Harima Chemicals Group, Inc.		500		2,151		0.02	%
Tomoku Co., Ltd.		94,000		252,472		1.62	%

The accompanying notes are an integral part of these financial statements.

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COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Materials (Continued)
Yushiro Chemical Industry Co., Ltd.		26,600	$	268,288		1.72	%
				1,162,056		7.46	%

Total Common Stocks
(Cost $13,404,200)				15,020,491		96.45	%

SHORT-TERM INVESTMENTS – 2.92%
Money Market Funds – 2.92%
Fidelity Government Portfolio –
Institutional Class, 0.01% (a)		454,012		454,012		2.92	%

Total Money Market Funds
(Cost $454,012)				454,012		2.92	%

Total Short-Term Investments
(Cost $454,012)				454,012		2.92	%

Total Investments
(Cost $13,858,212) – 99.37%				15,474,503		99.37	%
Other Assets in Excess
of Liabilities – 0.63%				97,440		0.63	%
TOTAL NET ASSETS – 100.00%			$	15,571,943		100.00	%

Percentages are stated as a percent of net assets.

(a)	The rate listed is the fund’s 7-day yield as of April 30, 2014.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Summary of Fair Value Exposure at April 30, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of April 30, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stock	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	—	$	4,218,922	$	—	$	4,218,922
Consumer Staples		—		400,405		—		400,405
Energy		—		89,275		—		89,275
Financials		—		590,552		—		590,552
Industrials		—		5,057,533		—		5,057,533
Information Technology		—		3,501,748		—		3,501,748
Materials		—		1,162,056		—		1,162,056
Total Common Stock	$	—	$	15,020,491	$	—	$	15,020,491
Short-Term Investments
Money Market Funds	$	454,012	$	—	$	—	$	454,012
Total Short-Term Investments	$	454,012	$	—	$	—	$	454,012
Total Investments	$	454,012	$	—	$	—	$	15,474,503

Transfers between levels are recognized at the end of the reporting period. During the six-month period ended April 30, 2014, the Fund recognized significant transfers between levels.

The accompanying notes are an integral part of these financial statements.

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Financial Statements

Statement of Assets and Liabilities as of April 30, 2014 (Unaudited)

ASSETS:
Investments in securities, at value (cost $13,858,212)	$	15,474,503
Dividends and interest receivable		160,390
Receivable for fund shares sold		12,343
Receivable for securities sold		122,316
Prepaid expenses and other assets		14,678
Total Assets		15,784,230

LIABILITIES:
Payable for securities purchased		157,612
Payable for fund shares redeemed		8,222
Payable to advisor		15,495
Payable to administrator		5,436
Payable to auditor		11,493
Accrued service fees		1,291
Accrued trustees fees		4,724
Accrued expenses and other payables		8,014
Total Liabilities		212,287
NET ASSETS	$	15,571,943

NET ASSETS CONSIST OF:
Capital stock	$	13,781,875
Accumulated net investment loss		(19,150	)
Accumulated net realized gain on investments		193,591
Unrealized net appreciation on investments		1,615,627
Total Net Assets	$	15,571,943

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		15,571,943
Shares issued and outstanding		1,604,588
Net asset value, offering price and redemption price per share	$	9.70

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Operations Six Months Ended April 30, 2014 (Unaudited)

INVESTMENT INCOME:
Dividend income(1)	$	177,644
Interest income		49
Total investment income		177,693

EXPENSES:
Investment advisory fees		92,790
Sub-transfer agent expenses – Investor Class (See Note 5)		16,235
Administration, fund accounting, custody and transfer agent fees		15,465
Federal and state registration fees		11,609
Compliance expense		10,655
Audit fees		9,571
Service fees – Investor Class (See Note 5)		7,732
Trustees’ fees and expenses		6,793
Reports to shareholders		2,753
Legal fees		2,480
Interest expense (See Note 6)		89
Other expenses		3,916
Total expenses		180,088
NET INVESTMENT LOSS	$	(2,395	)

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	353,014
Change in unrealized appreciation on investments		368,084
Net gain on investments		721,098
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	718,703

(1)	Net of foreign taxes withheld of $30,981.

The accompanying notes are an integral part of these financial statements.

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Financial Statements

Statements of Changes in Net Assets

	Six Months Ended
	April 30, 2014			Year Ended
	(Unaudited)			October 31, 2013
OPERATIONS:
Net investment loss	$	(2,395	)	$	(15,072	)
Net realized gain on securities		353,014			3,128,752
Change in unrealized appreciation on securities		368,084			1,109,483
Net increase in net assets resulting from operations		718,703			4,223,163

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net realized gains
Investor Class		(3,229,364	)		(1,115,069	)
Total distributions		(3,229,364	)		(1,115,069	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		11,334,915			23,641,290
Dividends reinvested – Investor Class		3,179,599			1,067,157
Cost of shares redeemed – Investor Class		(11,255,253	)(1)		(18,099,720	)
Net increase in net assets derived
from capital share transactions		3,259,261			6,608,727
TOTAL INCREASE IN NET ASSETS		748,600			9,716,821

NET ASSETS:
Beginning of period		14,823,343			5,106,522
End of period	$	15,571,943		$	14,823,343
Undistributed net investment loss, end of period	$	(19,150	)	$	(16,755	)

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		1,151,905			2,326,376
Shares issued to holders as reinvestment
of dividends – Investor Class		340,064			121,406
Shares redeemed – Investor Class		(1,154,154	)		(1,665,417	)
Net increase in shares outstanding		337,815			782,365

(1)	Net of redemption fees of $47 related to redemption fees imposed by the Fund during a prior year but not received until the six-month period ended April 30, 2014.

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Financial Highlights

Hennessy Japan Small Cap Fund

For an Investor Class share outstanding throughout each period

	Six Months Ended
	April 30, 2014
	(Unaudited)
PER SHARE DATA:
Net asset value, beginning of period	$	11.70

Income from investment operations:
Net investment income (loss)		0.00	(2)
Net realized and unrealized gains (losses) on securities		0.51
Total from investment operations		0.51

Less distributions:
Dividends from net investment income		—
Dividends from net realized gains		(2.51	)
Total distributions		(2.51	)
Paid-in capital from redemption fees		—
Net asset value, end of period	$	9.70

TOTAL RETURN		5.20	%(3)

SUPPLEMENTAL DATA AND RATIOS:
Net assets, end of period (millions)	$	15.57
Ratio of expenses to average net assets:
Before expense reimbursement		2.33	%(4)
After expense reimbursement		2.33	%(4)
Ratio of net investment income (loss) to average net assets:
Before expense reimbursement		(0.03	)%(4)
After expense reimbursement		(0.03	)%(4)
Portfolio turnover rate		29	%(3)

(1)	The financial highlights set forth for periods prior to September 17, 2009 represent the historical financial highlights of the SPARX Japan Smaller Companies Fund. On September 17, 2009, Hennessy Advisors, Inc. became the investment advisor to the Fund and the Fund changed its name to Hennessy Select SPARX Japan Smaller Companies Fund. In October 2012, the Fund changed its name to Hennessy Japan Small Cap Fund.
(2)	Amount is less than $0.01 or $(0.01).
(3)	Not annualized.
(4)	Annualized.

The accompanying notes are an integral part of these financial statements.

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Year Ended October 31,
2013			2012			2011			2010			2009(1)

$	10.54		$	10.09		$	9.23		$	9.74		$	6.87


	0.06			(0.68	)		0.06			0.00	(2)		0.07
	3.44			1.17			0.80			(0.10	)		2.80
	3.50			0.49			0.86			(0.10	)		2.87


	—			(0.04	)		—			(0.42	)		—
	(2.34	)		—			—			—			—
	(2.34	)		(0.04	)		—			(0.42	)		—
	—			—			—			0.01			0.00	(2)
$	11.70		$	10.54		$	10.09		$	9.23		$	9.74
	40.59	%		4.91	%		9.32	%		(0.72	)%		41.78	%


$	14.82		$	5.11		$	24.08		$	15.17		$	16.20

	2.39	%		2.33	%		2.10	%		2.14	%		3.10	%
	2.39	%		2.33	%		2.10	%		2.01	%		1.60	%

	(0.11	)%		(0.66	)%		0.17	%		(0.14	)%		(0.86	)%
	(0.11	)%		(0.66	)%		0.17	%		(0.01	)%		0.64	%
	141	%		49	%		61	%		100	%		138	%

The accompanying notes are an integral part of these financial statements.

HENNESSY FUNDS 1-800-966-4354

Notes to the Financial Statements

April 30, 2014 (Unaudited)

1). ORGANIZATION

The Hennessy Japan Small Cap Fund (the “Fund”) is a series of Hennessy Funds Trust (the “Trust”), which was organized as a Delaware statutory trust on September 17, 1992. The Fund is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund is a successor to a fund with the same name (the “Predecessor Fund”) that was a series Hennessy SPARX Funds Trust, a Massachusetts business trust, pursuant to a reorganization that took place after the close of business on February 28, 2014. Prior to February 28, 2014, the Fund had no investment operations. As a result of the reorganization, holders of the Investor Class shares of the Predecessor Fund received Investor Class shares of the Fund (the Investor Class shares of the Fund are the successor to the accounting and performance information of the Predecessor Fund). The investment objective of the Fund is long-term capital appreciation. The Fund is a diversified fund, but may employ a relatively focused investment strategy and may hold securities of fewer issuers than other diversified funds.

The Fund offers Investor Class shares. Prior to October 26, 2012, the Investor Class shares were known as Original Class shares.

2). SIGNIFICANT ACCOUNTING POLICIES

a).	Investment Valuation – All investments in securities are recorded at their estimated fair value, as described in Note 3.
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 of its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Net investment income or loss and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of temporary book and tax basis differences. Temporary differences are primarily the result of the treatment of wash sales for tax reporting purposes. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes.
c).	Income and Expenses – Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund. Interest income, which includes the amortization of premium and accretion of discount, is recognized on an accrual basis. The Fund is charged for those expenses that are directly attributable to the portfolio, such as advisory, administration, and certain shareholder service fees.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out annually, usually in November or December. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.

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e).	Security Transactions – Investment and shareholder transactions are recorded on the 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. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies, if any, are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.
	Securities pledged as collateral for repurchase agreements are held by the custodian bank until the respective agreements mature. Provisions of the repurchase agreements ensure that the market value of the collateral, including accrued interest thereon, is sufficient in the event of default of the counterparty. If the counterparty defaults and the value of the collateral declines or if the counterparty enters an insolvency proceeding, realization of the collateral by the Fund may be delayed or limited.
k).	Accounting for Uncertainty in Income Taxes – The Fund has adopted accounting policies regarding recognition and measurement of tax positions taken or expected to

HENNESSY FUNDS 1-800-966-4354

	be taken on a tax return. The Fund has reviewed all open tax years in major jurisdictions and concluded that there is no impact on the Fund’s net assets and no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on a tax return. The Fund’s major tax jurisdictions are U.S. Federal and Delaware. As of April 30, 2014, open Federal and state tax years for the Fund include the tax years ended October 31, 2011 through 2013.
l).	Derivatives – The Fund may invest in, or enter into, derivatives, such as options, futures contracts, options on futures contracts, and swaps, for a variety of reasons, including to hedge certain risks, to provide a substitute for purchasing or selling particular securities, or to increase potential income gain. Derivatives may provide a cheaper, quicker, or more specifically focused way for a Fund to invest than “traditional” securities would. The main purpose of utilizing these derivative instruments is for hedging purposes.
	The Fund has adopted the financial accounting reporting rules as required by the Derivatives and Hedging Topic of the Financial Accounting Standards Board Accounting Standards Codification. Under such rules, the Fund is required to include enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivatives instruments affect an entity’s results of operations and financial position. During the six months ended April 30, 2014, the Fund did not hold any derivative instruments.
m).	Events Subsequent to the Fiscal Period End – The Fund has adopted financial reporting rules regarding subsequent events that require an entity to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the balance sheet. Management has evaluated the Fund’s related events and transactions that occurred subsequent to April 30, 2014 through the date of issuance of the Fund’s financial statements. There were no events or transactions that occurred during this period that materially impacted the amounts or disclosures in the Fund’s financial statements.

3). SECURITIES VALUATION

	Level 1 –	Quoted unadjusted prices for identical instruments in active markets to which the Fund has access at the date of measurement.

	Level 2 –	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.

HENNESSYFUNDS.COM

Level 3 –

Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

Following is a description of the valuation techniques applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis.

HENNESSY FUNDS 1-800-966-4354

4). INVESTMENT TRANSACTIONS

Purchases and sales of investment securities (excluding government and short-term investments) for the Fund during the six months ended April 30, 2014 were $5,133,387 and $4,223,409, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund during the six months ended April 30, 2014.

5). INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Hennessy Advisors, Inc. (the “Advisor”) is the investment advisor of the Fund. The Advisor provides the Fund with investment management services under an Investment Advisory Agreement. The Advisor furnishes 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 from the Fund. The fee is based upon the average daily net assets of the Fund at the annual rate of 1.20%. The net investment advisory fees payable for the Fund as of April 30, 2014 were $15,495.

The Fund has entered into agreements with various brokers, dealers, and financial intermediaries in connection with the sale of shares of the Fund. The agreements provide

HENNESSYFUNDS.COM

6). LINE OF CREDIT

The Fund has a line of credit with the other funds in the Hennessy Funds family of funds (the “Hennessy Funds”) in the amount of the lesser of (i) $100,000,000 or (ii) 33.33% of each Hennessy Fund’s net assets, or 30% for the Hennessy Gas Utility Index Fund and 10% for the Hennessy Balanced Fund, intended to provide short-term financing, if necessary, subject to certain restrictions, in connection with shareholder redemptions. The credit facility is with the Hennessy Funds’ custodian bank, U.S. Bank, N.A. Borrowings under this arrangement bear interest at the bank’s prime rate. During the six months ended April 30, 2014, the Fund had an outstanding average daily balance and a weighted average interest rate of $5,983 and 3.25%, respectively. The maximum amount outstanding for the Fund during the period was $515,000.

7). FEDERAL TAX INFORMATION

As of October 31, 2013, the Fund’s most recent fiscal year end, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follows:

Cost of investments for tax purposes	$	13,565,109
Gross tax unrealized appreciation	$	1,595,870
Gross tax unrealized depreciation		(524,715	)
Net tax unrealized appreciation/depreciation	$	1,071,155
Undistributed ordinary income	$	2,248,979
Undistributed long-term capital gains		980,367
Total distributable earnings	$	3,229,346
Other accumulated gain (loss)	$	228
Total accumulated gain (loss)	$	4,300,729

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to capital loss carry overs, wash sales, and partnership adjustments.

At October 31, 2013, the Fund’s most recent fiscal year end, the Fund had no tax basis capital losses to offset future capital gains.

Capital losses sustained in the year ended October 31, 2012 and in future taxable years will not expire and may be carried over by the Fund without limitation; however,

HENNESSY FUNDS 1-800-966-4354

they will retain the character of the original loss. Furthermore, any losses incurred during those taxable years will be required to be utilized prior to the losses incurred in the pre-enactment taxable years. As a result of this ordering rule, pre-enactment capital loss carryforwards may be more likely to expire unused. Under pre-enactment law, capital losses could be carried forward for eight years, and carried forward as short-term capital losses, irrespective of the character of the original loss.

At October 31, 2013, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals or post-December loss deferrals.

The tax character of distributions paid during fiscal year 2014 (year-to-date) and fiscal year 2013 for the Fund were as follows:

	Six Months Ended		Year Ended
	April 30, 2014		October 31, 2013
Ordinary income	$	2,248,987	$	—
Long-term capital gain		980,377		1,115,069
	$	3,229,364	$	1,115,069

8). AGREEMENT AND PLAN OF REORGANIZATION

On December 11, 2013, the Board approved an Agreement and Plan of Reorganization (the “Agreement”), of the Hennessy Japan Small Cap Fund (the “New Fund”), pursuant to which the New Fund would be a successor to the corresponding series of the same name of Hennessy SPARX Funds Trust, a Massachusetts business trust (the “Predecessor Fund”). The Agreement provided for the transfer of assets of the Predecessor Fund to the New Fund and the assumption of the liabilities of the Predecessor Fund by the New Fund. The New Fund had the same investment objective and substantially similar principal investment strategies as the Predecessor Fund. The reorganization was effective as of the close of business on February 28, 2014. The following table illustrates the specifics of the reorganization:

	Shares of the New Fund
Predecessor Fund	Issued to Shareholders of	New Fund	Combined	Tax Status
Net Assets	the Predecessor Fund	Net Assets	Net Assets	of Transfer
$16,456,664(1)	1,713,726	$16,456,664	$16,456,664	Non-taxable

(1)

Included accumulated realized gains and unrealized appreciation in the amounts of $3,437,805 and $1,625,651, respectively.

HENNESSYFUNDS.COM

Expense Example (Unaudited)

April 30, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSY FUNDS 1-800-966-4354

			Expenses Paid
	Beginning	Ending	During Period(1)
	Account Value	Account Value	November 1, 2013 –
	November 1, 2013	April 30, 2014	April 30, 2014
Investor Class

Actual	$1,000.00	$1,052.00	$11.85

Hypothetical (5% return
before expenses)	$1,000.00	$1,013.24	$11.63

(1)	Expenses are equal to the Fund’s annualized expense ratio of 2.33%, multiplied by the average account value over the period, multiplied by 181/365 days (to reflect one-half year period).

HENNESSYFUNDS.COM

Proxy Voting

Quarterly Filings on Form N-Q

Householding

HENNESSY FUNDS 1-800-966-4354

Board Approval of Investment Advisory

Agreements

The Board reviewed a number of documents, including a memorandum provided by outside legal counsel that described the fiduciary duties of the Board with respect to approving the investment advisory agreement and the relevant factors for consideration, the Advisor’s most recent Form 10-K, a completed questionnaire from the sub-advisor, copies of the advisory and sub-advisory agreements, a fund fact sheet, and peer expense and performance comparisons. The Board considered and discussed numerous factors, including the following:

•

The Board considered the services identified below that are provided by the Advisor and the sub-advisor:

		•	The sub-advisor acts as the portfolio manager to the Fund, managing the composition of the portfolio of the Fund, including the purchase, retention, and disposition of portfolio securities in accordance with the Fund’s investment objectives, policies, and restrictions.
		•	The Advisor oversees distribution of the Fund through third-party broker/dealers and independent financial institutions such as Charles Schwab, Inc., Fidelity, TD Waterhouse, and Pershing. The Advisor participates in “no transaction fee” (“NTF”) programs with these companies on behalf of the Fund, which allows customers to purchase the Fund through third-party distribution channels without paying a transaction fee. The Advisor compensates a number of these third-party providers of NTF programs out of its own revenues and not those of the Fund.
		•	The Advisor oversees service providers that support the Fund in providing fund accounting, fund administration, fund distribution, transfer agency, and custodial services.

	•	The Board considered that the advisory services to be provided by the Advisor and the sub-advisor are services required for the operation of the Fund.
	•	The Board considered the nature and quality of the advisory services offered by the Advisor and the sub-advisor to the Fund.
	•	The Board considered that the terms of the advisory and sub-advisory agreements are fair and reasonable .
	•	The Board compared the performance of the Fund to benchmark indices over various periods of time and concluded that the positive performance of the Fund warranted the approval of the advisory and sub-advisory agreements.
	•	The Board reviewed the Fund’s expense ratio and comparable expense ratios for funds comparable to the Fund. The Board used data from Morningstar showing funds similar in asset size and investment objective to the Fund and determined that the expense ratio of the Fund falls within the range of the ratios of other comparable funds and concluded that the expenses of the Fund were reasonable.
	•	The Board considered the fees charged by the Advisor to those of funds similar in asset size and investment objective to the Fund and concluded the advisory fee of the Fund was reasonable and warranted approval of the advisory and sub-advisory agreements.

HENNESSYFUNDS.COM

	•	The Board considered the profitability of the Advisor and the sub-advisor with respect to the Fund and concluded the profits were reasonable and not excessive when compared to profitability guidelines set forth in relevant court cases.
	•	The Board considered the high level of professionalism and knowledge of the Advisor’s and sub-advisor’s employees, along with an extremely low level of turnover of the employees of the Advisor, and concluded that this was beneficial to the Fund and its shareholders, as it ensures that the Fund is operated efficiently.

All of the factors above were considered separately by the Board, including the Trustees who are not “interested persons” (as defined in the Investment Company Act of 1940, as amended) of the Fund (the “Independent Trustees”) meeting in an executive session. The factors were viewed in their totality by the Board, with no single factor being the principal or determinative factor in the Board’s determination of whether to approve the advisory and sub-advisory agreements. Based on the factors discussed above, the Board, including all of the Independent Trustees, recommended approval of the advisory and sub-advisory agreements.

HENNESSY FUNDS 1-800-966-4354

(This Page Intentionally Left Blank.)

For information, questions or assistance, please call

The Hennessy Funds

1-800-966-4354 or 1-415-899-1555

INVESTMENT ADVISOR

Hennessy Advisors, Inc.

7250 Redwood Blvd., Suite 200

Novato, California 94945

ADMINISTRATOR,

TRANSFER AGENT,

DIVIDEND PAYING AGENT &

SHAREHOLDER SERVICING AGENT

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, Wisconsin 53201-0701

CUSTODIAN

U.S. Bank N.A.

Custody Operations

1555 North River Center Dr., Suite 302

Milwaukee, Wisconsin 53212

TRUSTEES

Neil J. Hennessy

Robert T. Doyle

J. Dennis DeSousa

Gerald P. Richardson

COUNSEL

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

KPMG LLP

777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202-5306

DISTRIBUTOR

Quasar Distributors, LLC

615 East Michigan Street

Milwaukee, Wisconsin 53202

hennessyfunds.com | 1-800-966-4354

This report has been prepared for shareholders and may be distributed to

others only if preceded or accompanied by a current prospectus.

Item 2. Code of Ethics.

Not applicable for semi-annual reports.

Item 3. Audit Committee Financial Expert.

Not applicable for semi-annual reports.

Item 4. Principal Accountant Fees and Services.

Not applicable for semi-annual reports.

Item 5. Audit Committee of Listed Registrants.

Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).

Item 6. Investments.

Schedules of Investments are included as part of the reports to stockholders filed under Item 1 of this report.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable to open-end investment companies.

Item 10. Submission of Matters to a Vote of Security Holders.

None.

Item 11. Controls and Procedures.

(a)

The Registrant’s President and Treasurer have reviewed the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant and by the Registrant’s service provider.

(b)

There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

Item 12. Exhibits.

(a)	(1) Any code of ethics or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing of an exhibit. Not applicable.

(2) A separate certification for each principal executive and principal financial officer pursuant to Rule 30a-2(a) under the Act and Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.

(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable to open-end investment companies.

(b)	Certifications pursuant to Rule 30a-2(b) under the Act and Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant) Hennessy Funds Trust

By (Signature and Title)* /s/ Neil J. Hennessy

Neil J. Hennessy, President

Date: July 7, 2014

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By (Signature and Title)* /s/ Neil J. Hennessy

Neil J. Hennessy, President

Date: July 7, 2014

By (Signature and Title)* /s/ Teresa M. Nilsen

Teresa M. Nilsen, Treasurer

Date: July 7, 2014

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Universal Insurance Holdings, Inc.	2.36%
	Green Plains Renewable Energy, Inc.	2.33%
	Exterran Holdings, Inc.	2.31%
	Alaska Air Group, Inc.	2.28%
	Delta Air Lines, Inc.	2.26%
	Aceto Corp.	2.23%
	Southwest Airlines Co.	2.19%
	United Rentals, Inc.	2.18%
	Targa Resources Corp.	2.16%
	Tyson Foods, Inc., Class A	2.16%

COMMON STOCKS – 95.59%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 24.92%
Advance Auto Parts, Inc.		37,200	$	4,511,988		1.85	%
Carmike Cinemas, Inc. (a)		164,227		4,870,973		2.00	%
Core-Mark Holding Co., Inc.		60,972		4,910,685		2.01	%
G-III Apparel Group, Ltd. (a)		69,900		5,016,723		2.05	%
Jack in the Box, Inc. (a)		89,400		4,786,476		1.96	%
Jarden Corp. (a)		78,700		4,497,705		1.84	%
La-Z-Boy, Inc.		171,800		4,162,714		1.71	%
MDC Partners, Inc. (b)		187,197		4,571,350		1.87	%
New York Times Co.		326,300		5,246,904		2.15	%
Papa Johns International, Inc.		97,200		4,263,192		1.75	%
The Goodyear Tire & Rubber Co.		174,400		4,394,880		1.80	%
Tuesday Morning Corp. (a)		333,911		4,668,076		1.91	%
Visteon Corp. (a)		56,700		4,922,127		2.02	%
				60,823,793		24.92	%

Consumer Staples – 2.16%
Tyson Foods, Inc., Class A		125,400		5,263,038		2.16	%

Energy – 8.78%
Exterran Holdings, Inc.		131,100		5,639,922		2.31	%
Green Plains Renewable Energy, Inc.		190,200		5,686,980		2.33	%
Matrix Service Co. (a)		156,327		4,841,447		1.98	%
Targa Resources Corp.		48,800		5,269,912		2.16	%
				21,438,261		8.78	%

Financials – 7.84%
BGC Partners, Inc.		671,273		4,813,028		1.97	%
CNO Financial Group, Inc.		257,600		4,443,600		1.82	%
LPL Financial Holdings, Inc.		87,100		4,124,185		1.69	%
Universal Insurance Holdings, Inc.		393,500		5,756,905		2.36	%
				19,137,718		7.84	%

Health Care – 5.75%
Alere, Inc. (a)		133,000		4,442,200		1.82	%
CIGNA Corp.		61,700		4,938,468		2.02	%
MWI Veterinary Supply, Inc. (a)		29,700		4,652,208		1.91	%
				14,032,876		5.75	%

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Industrials – 36.36%
Aceto Corp.		248,784	$	5,443,394		2.23	%
Alaska Air Group, Inc.		59,100		5,560,128		2.28	%
Curtiss Wright Corp.		73,800		4,718,772		1.93	%
Delta Air Lines, Inc.		149,900		5,520,817		2.26	%
Engility Holdings, Inc. (a)		115,346		5,033,700		2.06	%
Huntington Ingalls Industries, Inc.		49,300		5,077,900		2.08	%
John Bean Technologies Corp.		159,786		4,632,196		1.90	%
L-3 Communications Holdings, Inc.		41,600		4,799,392		1.97	%
Lennox International, Inc.		53,200		4,459,756		1.83	%
Lockheed Martin Corp.		29,400		4,825,716		1.98	%
Northrop Grumman Corp.		39,500		4,799,645		1.97	%
Orbital Sciences Corp. (a)		171,896		5,053,742		2.07	%
Primoris Services Corp.		143,000		4,001,140		1.64	%
Raytheon Co.		49,300		4,707,164		1.93	%
Southwest Airlines Co.		221,600		5,356,072		2.19	%
The Manitowoc Co., Inc.		163,300		5,189,674		2.12	%
United Continental Holdings, Inc. (a)		104,200		4,258,654		1.74	%
United Rentals, Inc. (a)		56,800		5,329,544		2.18	%
				88,767,406		36.36	%

Information Technology – 5.81%
CSG Systems International, Inc.		175,000		4,613,000		1.89	%
Hewlett-Packard Co.		157,500		5,206,950		2.13	%
Super Micro Computer, Inc. (a)		214,900		4,375,364		1.79	%
				14,195,314		5.81	%

Materials – 3.97%
AK Steel Holding Corp. (a)		686,000		4,802,000		1.97	%
PolyOne Corp.		130,600		4,893,582		2.00	%
				9,695,582		3.97	%
Total Common Stocks
(Cost $207,900,555)				233,353,988		95.59	%

RIGHTS – 0.00%
Forest Laboratories, Inc. (a)(c)		5,500		5,225		0.00	%

Total Rights
(Cost $0)				5,225		0.00	%

PARTNERSHIPS – 2.07%	Number				% of
	of Shares		Value		Net Assets
Energy – 2.07%
NGL Energy Partners LP		130,579	$	5,049,490		2.07	%

Total Partnerships
(Cost $4,581,811)				5,049,490		2.07	%

SHORT-TERM INVESTMENTS – 1.69%

Money Market Funds – 1.69%
Fidelity Government Portfolio –
Institutional Class, 0.01% (d)		4,116,133		4,116,133		1.69	%

Total Money Market Funds
(Cost $4,116,133)				4,116,133		1.69	%

Total Short-Term Investments
(Cost $4,116,133)				4,116,133		1.69	%

Total Investments
(Cost $216,598,499) – 99.35%				242,524,836		99.35	%

Other Assets in
Excess of Liabilities – 0.65%				1,593,578		0.65	%
TOTAL NET ASSETS – 100.00%			$	244,118,414		100.00	%

	Rights
Balance as of October 31, 2013	$	5,225
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation (depreciation)		—
Purchases		—
(Sales)		—
Transfer in and/or out of Level 3		—
Balance as of April 30, 2014	$	5,225

Net in unrealized appreciation/depreciation during
the year for Level 3 investments held at April 30, 2014	$	5,225

(a)	Non-income producing security.
(b)	U.S. traded security of a foreign corporation.
(c)	Security is fair valued in good faith.
(d)	The rate listed is the fund’s 7-day yield as of April 30, 2014.

INVESTMENT INCOME:
Dividend income(1)	$	1,372,887
Interest income		270
Total investment income		1,373,157

EXPENSES:
Investment advisory fees		921,011
Administration, fund accounting, custody and transfer agent fees		248,922
Sub-transfer agent expenses – Investor Class (See Note 5)		162,743
Sub-transfer agent expenses – Institutional Class (See Note 5)		14,430
Service fees – Investor Class (See Note 5)		111,343
Reports to shareholders		22,399
Federal and state registration fees		18,893
Audit fees		12,793
Compliance expense		10,655
Trustees’ fees and expenses		8,380
Legal fees		2,480
Other expenses		12,623
Total expenses before waiver		1,546,672
Administration expense waiver (See Note 5)		(18,467	)
Net expenses		1,528,205
NET INVESTMENT LOSS	$	(155,048	)

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	42,943,746
Change in unrealized appreciation on investments		(19,552,664	)
Net gain on investments		23,391,082
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	23,236,034

	such as advisory, administration, and certain shareholder service fees. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its respective net assets.
d).	Distributions to Shareholders – Dividends from net investment income for the Fund, if any, are declared and paid out annually, usually in November or December. Distributions of net realized capital gains, if any, are declared and paid annually, usually in November or December.
e).	Security Transactions – Investment and shareholder transactions are recorded on the 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. Discounts and premiums on securities purchased are accreted/amortized over the life of the respective security.
f).	Use of Estimates – The preparation of financial statements in conformity with GAAP 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 change in net assets during the reporting period. Actual results could differ from those estimates.
g).	Share Valuation – The net asset value (“NAV”) per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on days the New York Stock Exchange is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.
h).	Foreign Currency – Values of investments denominated in foreign currencies, if any, are converted into U.S. dollars using the spot market rate of exchange at the time of valuation. Purchases and sales of investments and income are translated into U.S. dollars using the spot market rate of exchange prevailing on the respective dates of such transactions. The Fund does not isolate the portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from fluctuations resulting from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments. Foreign investments present additional risks due to currency fluctuations, economic and political factors, lower liquidity, government regulations, differences in accounting standards, and other factors.
i).	Forward Contracts – The Fund may enter into forward currency contracts to reduce its exposure to changes in foreign currency exchange rates on its foreign holdings and to lock in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a negotiated forward rate. The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing of such contract is included in net realized gain or loss from foreign currency transactions. During the six months ended April 30, 2014, the Fund did not enter into any forward contracts.
j).	Repurchase Agreements – The Fund may enter into repurchase agreements with member banks or security dealers of the Federal Reserve Board whom the investment advisor deems creditworthy. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates.

Cost of investments for tax purposes	$	201,929,450
Gross tax unrealized appreciation	$	49,734,271
Gross tax unrealized depreciation		(4,414,906	)
Net tax unrealized appreciation/depreciation	$	45,319,365
Undistributed ordinary income	$	—
Undistributed long-term capital gains		—
Total distributable earnings	$	—
Other accumulated gain (loss)	$	(194,324,076	)
Total accumulated gain (loss)	$	(149,004,711	)

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	O’Reilly Automotive, Inc.	9.15%
	Markel Corp.	8.52%
	American Tower Corp., Class A	8.49%
	CarMax, Inc.	6.29%
	Bally Technologies, Inc.	5.22%
	Gaming & Leisure Properties, Inc.	5.14%
	Aon PLC	4.95%
	Twenty First Century Fox, Inc.	4.51%
	The Charles Schwab Corp.	4.27%
	Encore Capital Group, Inc.	3.85%

COMMON STOCKS – 73.73%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 29.03%
Bally Technologies, Inc. (a)		1,169,000	$	76,113,590		5.22	%
CarMax, Inc. (a)		2,097,740		91,839,057		6.29	%
Dick’s Sporting Goods, Inc.		815,767		42,958,290		2.94	%
O’Reilly Automotive, Inc. (a)		897,900		133,598,541		9.15	%
Penn National Gaming, Inc. (a)		1,197,772		13,367,136		0.92	%
Twenty First Century Fox, Inc.		2,057,204		65,871,672		4.51	%
				423,748,286		29.03	%

Energy – 3.64%
World Fuel Services Corp.		1,168,204		53,200,010		3.64	%

Financials – 26.11%
Aon PLC (b)		851,000		72,232,880		4.95	%
Brookfield Asset Management, Inc.(b)		119,423		5,022,931		0.35	%
Diamond Hill Investment Group, Inc.		83,945		9,965,950		0.68	%
Encore Capital Group, Inc. (a)		1,300,849		56,222,694		3.85	%
Markel Corp. (a)		198,637		124,330,871		8.52	%
Marlin Business Services Corp.		493,638		8,475,765		0.58	%
T. Rowe Price Group, Inc.		517,900		42,535,127		2.91	%
The Charles Schwab Corp.		2,346,699		62,304,859		4.27	%
				381,091,077		26.11	%

Health Care – 1.41%
Henry Schein, Inc. (a)		180,000		20,561,400		1.41	%

Industrials – 5.10%
American Woodmark Corp. (a)		798,561		23,964,816		1.64	%
Mistras Group, Inc. (a)		11,642		264,390		0.02	%
Roadrunner Transportation Systems, Inc. (a)		904,200		22,270,446		1.53	%
Simpson Manufacturing Company, Inc.		850,000		27,871,500		1.91	%
				74,371,152		5.10	%

Information Technology – 8.44%
Google, Inc. (a)		68,984		36,331,113		2.49	%
Google, Inc., Class A (a)		68,984		36,898,162		2.53	%
MICROS Systems, Inc. (a)		971,148		50,014,122		3.42	%
				123,243,397		8.44	%
Total Common Stocks
(Cost $581,147,127)				1,076,215,322		73.73	%

REITS – 13.63%	Number					% of
	of Shares		Value			Net Assets

American Tower Corp., Class A		1,483,679	$	123,916,870			8.49	%
Gaming & Leisure Properties, Inc.		2,043,407		75,095,207			5.14	%

Total REITS
(Cost $81,851,999)				199,012,077			13.63	%

SHORT-TERM INVESTMENTS – 12.64%

Money Market Funds – 12.64%
Federated Government Obligations Fund – Class I, 0.01% (c)		72,500,000		72,500,000			4.97	%
Federated Treasury Obligations Fund, 0.01% (c)		39,448,162		39,448,162			2.70	%
Fidelity Government Portfolio – Institutional Class, 0.01% (c)		72,500,000		72,500,000			4.97	%

Total Money Market Funds
(Cost $184,448,162)				184,448,162			12.64	%

Total Short-Term Investments
(Cost $184,448,162)				184,448,162			12.64	%

Total Investments
(Cost $847,447,288) – 100.00%				1,459,675,561			100.00	%
Liabilities in Excess
of Other Assets – 0.00%				(20,981	)		0.00	%
TOTAL NET ASSETS – 100.00%			$	1,459,654,580			100.00	%

INVESTMENT INCOME:
Dividend income	$	20,618,833
Interest income		8,042
Total investment income		20,626,875

EXPENSES:
Investment advisory fees		6,377,920
Distribution fees – Investor Class (See Note 5)		1,489,317
Administration, fund accounting, custody and transfer agent fees		850,389
Sub-transfer agent expenses – Investor Class (See Note 5)		729,798
Sub-transfer agent expenses – Institutional Class (See Note 5)		75,957
Reports to shareholders		72,473
Federal and state registration fees		28,991
Trustees’ fees and expenses		12,556
Compliance expense		10,655
Audit fees		9,471
Legal fees		3,720
Other expenses		37,044
Total expenses		9,698,291
NET INVESTMENT INCOME	$	10,928,584

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	5,030,834
Change in unrealized appreciation on investments		11,022,433
Net gain on investments		16,053,267
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	26,981,851

(1)	Net of redemption fees of $949 related to redemption fees imposed by the FBR Focus Fund during a prior year but not received until the six-month period ended April 30, 2014.
(2)	Net of redemption fees of $1,716 related to redemption fees imposed by the FBR Focus Fund during a prior year but not received until fiscal year 2013.

*	Per share amounts have been restated on a retroactive basis to reflect a 1:18 reverse stock split effective December 10, 2010.
(1)	Calculated based on average shares outstanding method.
(2)	Amount is less than $0.01.
(3)	Portfolio turnover is calculated on the basis of the Fund as a whole.
(4)	Annualized.
(5)	Not annualized.

Year Ended October 31,
2013			2012			2011			2010			2009

$	12.38		$	9.97		$	10.28		$	8.81		$	8.80


	(0.11	)		(0.07	)		(0.08	)		(0.10	)		(0.04	)
	3.38			2.48			(0.23	)		1.57			0.05
	3.27			2.41			(0.31	)		1.47			0.01
$	15.65		$	12.38		$	9.97		$	10.28		$	8.81

	26.41	%		24.17	%		(3.02	)%		16.69	%		0.11	%


$	220.83		$	265.60		$	184.40		$	207.11		$	228.96
	1.29	%		1.34	%		1.33	%		1.34	%		1.36	%
	(0.26	)%		(0.66	)%		(0.78	)%		(0.89	)%		(0.42	)%
	105	%		90	%		106	%		103	%		108	%

	$ 10,518,607	10/31/16
	$183,155,263	10/31/17

Cost of investments for tax purposes	$	716,452,529
Gross tax unrealized appreciation	$	605,898,829
Gross tax unrealized depreciation		(4,692,989	)
Net tax unrealized appreciation/depreciation	$	601,205,840
Undistributed ordinary income	$	—
Undistributed long-term capital gains		22,447,669
Total distributable earnings	$	22,447,669
Other accumulated gain (loss)	$	(7,643,708	)
Total accumulated gain (loss)	$	616,009,801

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Avis Budget Group, Inc.	5.18%
	Huntington Ingalls Industries, Inc.	4.52%
	Alaska Air Group, Inc.	4.37%
	Genworth Financial, Inc.	4.09%
	Skechers USA, Inc.	3.98%
	Hanesbrands, Inc.	3.88%
	Sunpower Corp.	3.78%
	Pilgrim’s Pride Corp.	3.74%
	ITT Corp.	3.55%
	Swift Transportation Co.	3.53%

COMMON STOCKS – 95.57%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 35.74%
American Axle & Manufacturing Holdings, Inc. (a)		344,700	$	6,083,955		2.64	%
Brunswick Corp.		170,800		6,864,452		2.98	%
Cracker Barrel Old Country Store, Inc.		66,200		6,271,788		2.72	%
Hanesbrands, Inc.		108,900		8,939,601		3.88	%
Lear Corp.		94,900		7,882,394		3.42	%
Lithia Motors, Inc.		93,600		6,952,608		3.01	%
Skechers USA, Inc. (a)		223,900		9,177,661		3.98	%
Tenneco, Inc. (a)		135,100		8,088,437		3.51	%
The Goodyear Tire & Rubber Co.		303,600		7,650,720		3.32	%
Visteon Corp. (a)		90,600		7,864,986		3.41	%
Wendy’s Co.		797,500		6,627,225		2.87	%
				82,403,827		35.74	%

Consumer Staples – 6.53%
Flowers Foods, Inc.		313,800		6,439,176		2.79	%
Pilgrim’s Pride Corp. (a)		394,100		8,615,026		3.74	%
				15,054,202		6.53	%

Financials – 10.27%
American Equity Investment Life Holding Co.		322,500		7,520,700		3.26	%
AmTrust Financial Services, Inc.		174,600		6,751,782		2.93	%
Genworth Financial, Inc. (a)		527,300		9,412,305		4.08	%
				23,684,787		10.27	%

Health Care – 6.43%
Omnicare, Inc.		123,400		7,313,918		3.17	%
Universal Health Services, Inc.		91,800		7,508,322		3.26	%
				14,822,240		6.43	%

Industrials – 27.11%
Alaska Air Group, Inc.		107,200		10,085,376		4.37	%
Avis Budget Group, Inc. (a)		227,000		11,937,930		5.18	%
Huntington Ingalls Industries, Inc.		101,100		10,413,300		4.52	%
ITT Corp.		190,000		8,196,600		3.55	%
Oshkosh Corp.		140,000		7,771,400		3.37	%
Swift Transportation Co. (a)		338,700		8,145,735		3.53	%
URS Corp.		126,500		5,960,680		2.59	%
				62,511,021		27.11	%

ASSETS:
Investments in securities, at value (cost $202,088,643)	$	230,746,994
Dividends and interest receivable		61,599
Receivable for fund shares sold		1,001,725
Receivable for securities sold		9,598,571
Prepaid expenses and other assets		31,187
Total Assets		241,440,076

LIABILITIES:
Payable for securities purchased		10,394,748
Payable for fund shares redeemed		190,156
Payable to advisor		137,298
Payable to administrator		60,329
Payable to auditor		13,891
Accrued service fees		14,040
Accrued interest payable		551
Accrued trustees fees		4,755
Accrued expenses and other payables		59,211
Total Liabilities		10,874,979
NET ASSETS	$	230,565,097

NET ASSETS CONSIST OF:
Capital stock	$	198,486,007
Accumulated net investment loss		(37,733	)
Accumulated net realized gain on investments		3,458,472
Unrealized net appreciation on investments		28,658,351
Total Net Assets	$	230,565,097

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		174,637,921
Shares issued and outstanding		9,643,958
Net asset value, offering price and redemption price per share	$	18.11

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares		55,927,176
Shares issued and outstanding		3,033,962
Net asset value, offering price and redemption price per share	$	18.43

INVESTMENT INCOME:
Dividend income	$	912,557
Interest income		334
Total investment income		912,891

EXPENSES:
Investment advisory fees		803,688
Administration, fund accounting, custody and transfer agent fees		217,213
Sub-transfer agent expenses – Investor Class (See Note 5)		145,096
Sub-transfer agent expenses – Institutional Class (See Note 5)		23,558
Service fees – Investor Class (See Note 5)		82,431
Federal and state registration fees		23,555
Reports to shareholders		17,257
Compliance expense		10,655
Audit fees		9,868
Trustees’ fees and expenses		7,878
Legal fees		2,480
Other expenses		10,428
Total expenses before waiver		1,354,107
Administration expense waiver (See Note 5)		(32,882	)
Net expenses		1,321,225
NET INVESTMENT LOSS	$	(408,334	)

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	5,310,089
Change in unrealized appreciation on investments		21,216,002
Net gain on investments		26,526,091
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	26,117,757

		drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, the prices are fair value adjusted due to post-market close subsequent events (foreign markets), little public information exists, or instances where prices vary substantially over time or among brokered market makers. These inputs may also include interest rates, prepayment speeds, credit risk curves, default rates, and similar data.
	Level 3 –	Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions about what market participants would use to price the asset or liability based on the best available information.

Cost of investments for tax purposes	$	203,302,306
Gross tax unrealized appreciation	$	11,718,602
Gross tax unrealized depreciation		(4,276,253	)
Net tax unrealized appreciation/depreciation	$	7,442,349
Undistributed ordinary income	$	724,245
Undistributed long-term capital gains		15,252,709
Total distributable earnings	$	15,976,954
Other accumulated gain (loss)	$	(1,481,017	)
Total accumulated gain (loss)	$	21,938,286

	TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
	Total SA – ADR	2.19%
	CenturyLink, Inc.	2.15%
	Banco Santander SA – ADR	2.06%
	Royal Dutch Shell PLC – ADR	2.05%
	Unilever PLC – ADR	2.04%
	Altria Group, Inc.	2.03%
	Kellogg Co.	2.03%
	Johnson & Johnson	2.02%
	ConocoPhillips	2.01%
	Exxon Mobil Corp.	1.97%

COMMON STOCKS – 95.68%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 9.19%
Ford Motor Co.		190,600	$	3,078,190		1.92	%
General Motors Co.		78,700		2,713,576		1.69	%
McDonald’s Corp .		29,800		3,021,124		1.89	%
Target Corp.		50,000		3,087,500		1.93	%
Thomson Reuters Corp. (b)		78,100		2,825,658		1.76	%
				14,726,048		9.19	%

Consumer Staples – 23.01%
Altria Group, Inc.		81,300		3,260,943		2.03	%
ConAgra Foods, Inc.		90,300		2,755,053		1.72	%
General Mills, Inc.		59,200		3,138,784		1.96	%
Kellogg Co.		48,700		3,254,621		2.03	%
Kimberly Clark Corp.		26,300		2,952,175		1.84	%
Kraft Foods Group, Inc.		54,200		3,081,812		1.92	%
Pepsico, Inc.		35,300		3,031,917		1.89	%
Philip Morris International, Inc.		36,800		3,143,824		1.96	%
Procter & Gamble Co.		36,600		3,021,330		1.89	%
Sysco Corp.		80,300		2,925,329		1.83	%
The Coca-Cola Co.		74,500		3,038,855		1.90	%
Unilever PLC – ADR		72,900		3,261,546		2.04	%
				36,866,189		23.01	%

Energy – 13.97%
BP PLC – ADR		60,100		3,042,262		1.90	%
Chevron Corp.		24,900		3,125,448		1.95	%
ConocoPhillips		43,400		3,225,054		2.01	%
Exxon Mobil Corp.		30,800		3,154,228		1.97	%
Occidental Petroleum Corp.		31,800		3,044,850		1.90	%
Royal Dutch Shell PLC – ADR		38,800		3,284,420		2.05	%
Total SA – ADR		49,300		3,512,132		2.19	%
				22,388,394		13.97	%

Financials – 3.85%
Banco Santander SA – ADR		331,600		3,302,736		2.06	%
J.P. Morgan Chase & Co.		51,100		2,860,578		1.79	%
				6,163,314		3.85	%

SHORT-TERM INVESTMENTS – 5.69%	Number					% of
	of Shares		Value			Net Assets
Money Market Funds – 5.69%
Federated Government Obligations Fund – Class I, 0.01% (a)		1,195,062	$	1,195,062			0.75	%
Fidelity Government Portfolio – Institutional Class, 0.01% (a)		7,920,000		7,920,000			4.94	%

Total Money Market Funds
(Cost $9,115,062)				9,115,062			5.69	%

Total Short-Term Investments
(Cost $9,115,062)				9,115,062			5.69	%

Total Investments
(Cost $128,434,349) – 101.37%				162,436,945			101.37	%
Liabilities in Excess
of Other Assets – (1.37)%				(2,189,143	)		(1.37	)%
TOTAL NET ASSETS – 100.00%			$	160,247,802			100.00	%

INVESTMENT INCOME:
Dividend income(1)	$	2,359,550
Interest income		267
Total investment income		2,359,817

EXPENSES:
Investment advisory fees		527,827
Administration, fund accounting, custody and transfer agent fees		142,656
Service fees – Investor Class (See Note 5)		69,338
Sub-transfer agent expenses – Investor Class (See Note 5)		47,496
Sub-transfer agent expenses – Institutional Class (See Note 5)		1,592
Federal and state registration fees		15,368
Audit fees		11,425
Compliance expense		10,655
Reports to shareholders		9,025
Trustees’ fees and expenses		7,488
Legal fees		2,480
Other expenses		8,743
Total expenses before waiver		854,093
Administration expense waiver (See Note 5)		(3,201	)
Net expenses		850,892
NET INVESTMENT INCOME	$	1,508,925

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	8,681,478
Change in unrealized appreciation on investments		1,647,176
Net gain on investments		10,328,654
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	11,837,579

Cost of investments for tax purposes	$	110,932,811
Gross tax unrealized appreciation	$	34,383,174
Gross tax unrealized depreciation		(2,440,803	)
Net tax unrealized appreciation/depreciation	$	31,942,371
Undistributed ordinary income	$	3,048,910
Undistributed long-term capital gains		—
Total distributable earnings	$	3,048,910
Other accumulated gain (loss)	$	(32,066,745	)
Total accumulated gain (loss)	$	2,924,536

(1)	Periods less than one year are not annualized.
(2)	The 75/25 Blended DJIA/Treasury Index consists of 75% common stocks represented by the Dow Jones Industrial Average and 25% short-duration Treasury securities represented by the BofA Merrill Lynch 90-day Treasury Bill Index.

	TOP TEN HOLDINGS	% NET ASSETS
	U.S. Treasury Bill, 0.030%, 07/24/2014	26.83%
	U.S. Treasury Bill, 0.050%, 06/26/2014	21.00%
	U.S. Treasury Bill, 0.015%, 05/22/2014	15.17%
	Merck & Co., Inc.	8.28%
	Intel Corp.	7.43%
	AT&T, Inc.	7.22%
	Chevron Corp.	7.22%
	Pfizer, Inc.	7.18%
	McDonald’s Corp.	7.06%
	Verizon Communications, Inc.	6.81%

COMMON STOCKS – 74.40%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 7.06%
McDonald’s Corp.		59,700	$	6,052,386		7.06	%

Consumer Staples – 6.39%
Procter & Gamble Co.		54,000		4,457,700		5.20	%
The Coca-Cola Co.		25,100		1,023,829		1.19	%
				5,481,529		6.39	%

Energy – 7.22%
Chevron Corp.		49,300		6,188,136		7.22	%

Financials – 0.35%
J.P. Morgan Chase & Co.		5,300		296,694		0.35	%

Health Care – 16.09%
Johnson & Johnson		5,300		536,837		0.63	%
Merck & Co., Inc.		121,200		7,097,472		8.28	%
Pfizer, Inc.		196,800		6,155,904		7.18	%
				13,790,213		16.09	%

Industrials – 6.42%
General Electric Co.		204,700		5,504,383		6.42	%

Information Technology – 12.91%
Cisco Systems, Inc.		66,200		1,529,882		1.79	%
Intel Corp.		238,700		6,370,903		7.43	%
Microsoft Corp.		78,300		3,163,320		3.69	%
				11,064,105		12.91	%

Materials – 3.93%
EI Du Pont de Nemours & Co.		50,100		3,372,732		3.93	%

Telecommunication Services – 14.03%
AT&T, Inc.		173,400		6,190,380		7.22	%
Verizon Communications, Inc.		124,900		5,836,577		6.81	%
				12,026,957		14.03	%
Total Common Stocks
(Cost $50,187,041)				63,777,135		74.40	%

SHORT-TERM INVESTMENTS – 65.55%	Number of Shares/					% of
	Par Amount		Value			Net Assets
Money Market Funds – 2.55%
Fidelity Government Portfolio –
Institutional Class, 0.01% (a)		2,184,782	$	2,184,782			2.55	%

Total Money Market Funds
(Cost $2,184,782)				2,184,782			2.55	%

U.S. Treasury Bills – 63.00%
0.015%, 05/22/2014 (b)(c)		13,000,000		12,999,697			15.17	%
0.050%, 06/26/2014 (b)(c)		18,000,000		17,998,880			21.00	%
0.030%, 07/24/2014 (b)(c)		23,000,000		22,999,402			26.83	%

Total U.S. Treasury Bills
(Cost $53,997,773)				53,997,979			63.00	%

Total Short-Term Investments
(Cost $56,182,555)				56,182,761			65.55	%

Total Investments
(Cost $106,369,596) – 139.95%				119,959,896			139.95	%
Liabilities in Excess
of Other Assets – (39.95)%				(34,242,078	)		(39.95	)%
TOTAL NET ASSETS – 100.00%			$	85,717,818			100.00	%

(a)	The rate listed is the fund’s 7-day yield as of April 30, 2014.
(b)	The rate listed is discount rate at issue.
(c)	Held as collateral for reverse repurchase agreements.

				Principal	Maturity	Maturity
Face Value		Counterparty	Rate	Trade Date	Date	Amount
$	8,995,000	Jefferies, LLC	0.25%	2/20/14	5/22/14	$	9,000,622
	10,794,000	Jefferies, LLC	0.25%	3/27/14	6/26/14		10,800,746
	14,392,000	Jefferies, LLC	0.25%	4/24/14	7/24/14		14,400,995
$	34,181,000					$	34,202,363

INVESTMENT INCOME:
Dividend income	$	1,154,783
Interest income		10,102
Total investment income		1,164,885

EXPENSES:
Investment advisory fees		261,882
Administration, fund accounting, custody and transfer agent fees		87,294
Distribution fees – Investor Class (See Note 5)		65,470
Service fees – Investor Class (See Note 5)		43,647
Sub-transfer agent expenses – Investor Class (See Note 5)		40,423
Interest expense (See Notes 6 and 8)		39,891
Federal and state registration fees		14,303
Compliance expense		10,655
Audit fees		10,315
Reports to shareholders		6,248
Trustees’ fees and expenses		4,959
Legal fees		2,481
Other expenses		6,283
Total expenses		593,851
NET INVESTMENT INCOME	$	571,034

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	3,598,799
Change in unrealized appreciation on investments		274,796
Net gain on investments		3,873,595
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	4,444,629

Cash Flows From Operating Activities:
Net increase in net assets from operations	$	4,444,629
Adjustments to reconcile net increase in net assets from
operations to net cash provided by operating activities:
Purchase of investment securities		(61,729,784	)
Proceeds on sale of securities		70,210,794
Increase in other receivables, net		(14,415	)
Decrease in other assets		4,895
Decrease in accrued expenses and other payables		(64,604	)
Net accretion of discount on securities		(9,987	)
Net realized gain on investments		(3,598,799	)
Unrealized appreciation on securities		(274,796	)
Net cash provided by operating activities	$	8,967,933

Cash Flows From Financing Activities:
Increase in reverse repurchase agreements	$	—
Proceeds on shares sold		3,312,735
Payment on shares repurchased		(12,243,186	)
Cash dividends paid, net of dividends reinvested		(37,482	)
Net cash used in financing activities	$	(8,967,933	)

Cash at beginning of period		—
Cash at end of period		—
Net increase (decrease) in cash	$	—

Cash paid for interest	$	44,553