hft_hf-ncsra.htm

ANNUAL REPORT

OCTOBER 31, 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		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
Report of Independent Registered Public Accounting Firm		25
Trustees and Officers of the Fund		26
Expense Example		30
Proxy Voting		32
Quarterly Filings on Form N-Q		32
Federal Tax Distribution Information		32
Householding		32
Privacy Policy		33

HENNESSY FUNDS 1-800-966-4354

December 2014

Dear Shareholder:

As I look back at 2014, I realize that in this age of rapidly evolving technology, information is delivered and absorbed so quickly that it is difficult to remember what happened last week, let alone what’s happened over the course of an entire year. That is why I’d like to take a moment to recall some of the year’s highs and lows, economically, politically and socially, here in the U.S. and around the globe. 2014 was scarred by political partisanship, civil unrest in the U.S., Ukraine and many other countries, the arrival of terrorist group ISIS, the tragedies of school shootings and natural disasters, and the frightening outbreak of Ebola. However, there were also positive events this year: we survived a government shutdown over healthcare reform, jobs reports have been consistently, albeit anemically, improving, and home prices remained relatively stable, after recovering significantly in 2013. And, important to us here at Hennessy, our hometown team, the San Francisco Giants, won their third World Series in just five years!

A significant event for the financial industry this past year was the confirmation of Janet Yellen as Chair of the Federal Reserve, which served to calm the nerves of business and political leaders alike. I believe Yellen’s leadership will benefit U.S. business owners, as the Fed continues to be a voice of reason in a sea of political and economic rhetoric. The Fed has also supported the economy and corporate America by helping keep interest rates reasonable and low.

The stock market has continued its determined comeback from the lows of 2009, setting multiple record highs in recent months. The U.S. financial markets have provided strong returns over the past twelve-month period ended October 31, 2014, with the Dow Jones Industrial Average (DJIA) returning over 14% and S&P 500 Index returning over 17% during the period. The DJIA currently has a dividend yield of 2.2%, which is equal to that of a 10-Year U.S. Treasury, which is currently also yielding 2.2%. I continue to believe that investments in high-yielding, high-quality stocks have the potential to not only provide income but also the potential 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. American investors are slowly migrating from fixed income to equities. Currently, 54% of Americans invest in stocks, and I do expect this percentage to increase, especially if interest rates move higher.

For the past several years, U.S. corporations have been driving shareholder value by making acquisitions, initiating and raising dividends, investing in internal infrastructure and buying back stock. However, this year I began to see a shift from those strategies. I believe the easier to execute acquisitions are 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. What will these cash-rich companies do with their capital if they are not raising dividends or buying back stock? I believe they may begin to initiate capital expenditure programs that could truly benefit economic growth.

Liquidity and monetary conditions are supportive, causing the cost of capital to be very low. I believe firms will choose to spend capital to expand their sales, and they may even begin to hire in earnest. Once a company begins to move in this way, the cost to

HENNESSYFUNDS.COM

defer becomes real for competitors. With almost $3 trillion in cash and short-term investments sitting on the balance sheets of the S&P 500 companies, a strategic shift by firms to spend their idle capital, while slow, could potentially further economic growth in the U.S. in my opinion.

Economic progress and growth remain slow, yet steady, and unemployment, though improving, remains high. Oil prices have fallen, giving consumers a bit more discretionary income. While the midterm elections may not end all of the gridlock in Washington, hopefully we will receive clarity on the political headwinds of taxes and regulations, which have not improved over the past several years.

The markets have had several quarters without any truly significant downturn. The pullbacks we recently experienced, most notably in July and October, were short-lived, as evidenced by the quick rebound to record high market levels. I firmly believe that we are in a secular bull market, and I continue to tell investors to try to remain calm in the face of volatility and continue to focus on the strong, long-term fundamentals that are evident in the market today. Many companies continue to have strong balance sheets, with record cash flows and profits. With this current bull market in its fifth year, investors should expect some volatility.

I am encouraged by the strong returns for the major U.S. financial market indices and by the performance of the Hennessy Funds over the past year. Thank you for your continued confidence and investment in our products. If you have any questions or would like 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 Index are unmanaged indices commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

Cash flow can be used as an indication of a company’s financial strength. A firm’s cash flow is the movement of cash in and out of the firm in the form of payments to suppliers and collections from customers. Dividend Yield is calculated as the annual dividends paid by a company divided by the price of a share of their stock.

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 multiple factors, and may not be relied upon as an indication of trading intent on behalf of the Fund. Security positions can and do change.

CHANGE IN VALUE OF $10,000 INVESTMENT

This chart assumes an initial gross investment of $10,000 made on March 20, 2009 (inception date of the Fund). Returns shown include the reinvestment of all dividends. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED OCTOBER 31, 2014

			Since
	One	Five	Inception
	Year	Years	(3/20/09)
Hennessy Large Growth Fund –
Investor Class (HFLGX)	18.73%	16.87%	22.14%
Hennessy Large Growth Fund –
Institutional Class (HILGX)	18.96%	17.18%	22.47%
Russell 1000® Index	16.78%	16.98%	21.68%
S&P 500 Index	17.27%	16.69%	21.29%

Expense ratios: 1.19% (Investor Class); Gross 1.10%, Net 0.98%(1) (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)	With regard to Institutional Class shares, the Fund’s investment advisor has contractually agreed to waive a portion of its expenses indefinitely.

HENNESSYFUNDS.COM

PERFORMANCE NARRATIVE

Portfolio Managers Neil Hennessy and Brian Peery

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

For the twelve month period ended October 31, 2014, the Investor Class of the Hennessy Cornerstone Large Growth Fund returned 18.73%, outperforming the Russell 1000® Index, the S&P 500 Index and the Morningstar Large Blend Category Average, which returned 16.78%, 17.27% and 14.33% for the same period, respectively.

We are very pleased with the overall performance of the Fund during the previous twelve months versus its benchmarks. The Fund’s relative outperformance was driven entirely by stock selection, as sector allocation had a slightly 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 most of the outperformance relative to the Russell 1000® Index. The largest detractor to the Fund’s performance was its allocation and stock selection within the Consumer Discretionary sector.

Additional Portfolio Manager commentary and related investment outlook:

During the last twelve 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, companies are still doing well, and the latest quarter’s results are certainly showing signs of promise. 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 all-important corporate capital expenditures levels. Over the last twelve 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 beginning to utilize their healthy balance sheets to focus on organic growth, which we expect should drive corporate spending higher. In fact, we anticipate the U.S. economy will 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 appear to be leading their respective industries in creating value for their shareholders.

We believe the current attractiveness of equity prices, in an extremely low interest rate environment, have many investors seeking high-quality growth companies. Of note, 46 out of the 50 stocks within the portfolio pay a dividend. In our view, investing in dividend-paying growth companies can provide the enticing potential to provide income while also allowing for the potential for stock price appreciation.

HENNESSY FUNDS 1-800-966-4354

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.

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Financial Statements

Schedule of Investments

HENNESSY CORNERSTONE LARGE GROWTH FUND

As of October 31, 2014

(% of Net Assets)

TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS

Kroger Co.	2.60%
Union Pacific Corp.	2.55%
Apple, Inc.	2.55%
Delta Air Lines, Inc.	2.51%
SanDisk Corp.	2.50%
Intel Corp.	2.41%
Lockheed Martin Corp.	2.38%
Eli Lilly & Co.	2.37%
Altria Group, Inc.	2.34%
Microsoft Corp.	2.33%

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.

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS – 97.20%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 15.93%
Autozone, Inc. (a)		4,600	$	2,546,192		2.12	%
Bed Bath & Beyond, Inc. (a)		27,300		1,838,382		1.53	%
Coach, Inc.		39,100		1,344,258		1.12	%
Dollar General Corp. (a)		36,100		2,262,387		1.88	%
Ford Motor Co.		141,800		1,997,962		1.66	%
Lowes Companies, Inc.		44,900		2,568,280		2.13	%
Macy’s, Inc.		41,100		2,376,402		1.97	%
McDonald’s Corp.		22,800		2,137,044		1.78	%
The Gap, Inc.		55,600		2,106,684		1.75	%
				19,177,591		15.93	%

Consumer Staples – 18.55%
Altria Group, Inc.		58,300		2,818,222		2.34	%
General Mills, Inc.		44,600		2,317,416		1.93	%
Kimberly Clark Corp.		21,100		2,411,097		2.00	%
Kraft Foods Group, Inc.		41,100		2,315,985		1.92	%
Kroger Co.		56,200		3,130,902		2.60	%
Pepsico, Inc.		26,700		2,567,739		2.13	%
Philip Morris International, Inc.		25,700		2,287,557		1.90	%
Sysco Corp.		61,000		2,350,940		1.95	%
Wal-Mart Stores, Inc.		28,000		2,135,560		1.78	%
				22,335,418		18.55	%

Energy – 12.86%
Chevron Corp.		17,700		2,123,115		1.76	%
ConocoPhillips		31,400		2,265,510		1.88	%
Exxon Mobil Corp.		22,100		2,137,291		1.78	%
Halliburton Co.		43,900		2,420,646		2.01	%
HollyFrontier Corp.		44,500		2,019,410		1.68	%
Marathon Oil Corp.		63,700		2,254,980		1.87	%
Marathon Petroleum Corp.		24,900		2,263,410		1.88	%
				15,484,362		12.86	%

Health Care – 6.53%
Baxter International, Inc.		31,775		2,228,699		1.85	%
Eli Lilly & Co.		43,000		2,852,190		2.37	%
UnitedHealth Group, Inc.		29,300		2,783,793		2.31	%
				7,864,682		6.53	%

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

HENNESSYFUNDS.COM

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Industrials – 23.52%
Caterpillar, Inc.		24,500	$	2,484,545		2.06	%
CSX Corp.		77,300		2,754,199		2.29	%
Cummins, Inc.		15,800		2,309,644		1.92	%
Deere & Co.		24,300		2,078,622		1.73	%
Delta Air Lines, Inc.		75,200		3,025,296		2.51	%
Illinois Tool Works, Inc.		26,300		2,394,615		1.99	%
Lockheed Martin Corp.		15,000		2,858,550		2.38	%
Northrop Grumman Corp.		19,400		2,676,424		2.22	%
Raytheon Co.		24,800		2,576,224		2.14	%
Union Pacific Corp.		26,400		3,074,280		2.55	%
United Technologies Corp.		19,500		2,086,500		1.73	%
				28,318,899		23.52	%

Information Technology – 17.76%
Apple, Inc.		28,450		3,072,600		2.55	%
Hewlett-Packard Co.		77,600		2,784,288		2.31	%
Intel Corp.		85,300		2,901,053		2.41	%
International Business Machines Corp.		11,800		1,939,920		1.61	%
Microsoft Corp.		59,600		2,798,220		2.33	%
Oracle Corp.		58,400		2,280,520		1.89	%
SanDisk Corp.		31,900		3,003,066		2.50	%
Western Digital Corp.		26,400		2,596,968		2.16	%
				21,376,635		17.76	%

Materials – 2.05%
CF Industries Holdings, Inc.		9,500		2,470,000		2.05	%

Total Common Stocks
(Cost $91,738,368)				117,027,587		97.20	%

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

HENNESSY FUNDS 1-800-966-4354

SHORT-TERM INVESTMENTS – 2.87%	Number					% of
	of Shares		Value			Net Assets
Money Market Funds – 2.87%
Fidelity Government Portfolio – Institutional Class, 0.01% (b)		3,451,622	$	3,451,622			2.87	%

Total Short-Term Investments
(Cost $3,451,622)				3,451,622			2.87	%

Total Investments
(Cost $95,189,990) – 100.07%				120,479,209			100.07	%
Liabilities in Excess
of Other Assets – (0.07)%				(90,723	)		(0.07	)%
TOTAL NET ASSETS – 100.00%			$	120,388,486			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 October 31, 2014.

Summary of Fair Value Exposure at October 31, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of October 31, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stocks	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	19,177,591	$	—	$	—	$	19,177,591
Consumer Staples		22,335,418		—		—		22,335,418
Energy		15,484,362		—		—		15,484,362
Health Care		7,864,682		—		—		7,864,682
Industrials		28,318,899		—		—		28,318,899
Information Technology		21,376,635		—		—		21,376,635
Materials		2,470,000		—		—		2,470,000
Total Common Stocks	$	117,027,587	$	—	$	—	$	117,027,587
Short-Term Investments
Money Market Funds	$	3,451,622	$	—	$	—	$	3,451,622
Total Short-Term Investments	$	3,451,622	$	—	$	—	$	3,451,622
Total Investments	$	120,479,209	$	—	$	—	$	120,479,209

Transfers between levels are recognized at the end of the reporting period. During the one-year period ended October 31, 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 October 31, 2014

ASSETS:
Investments in securities, at value (cost $95,189,990)	$	120,479,209
Dividends and interest receivable		110,591
Receivable for fund shares sold		6,740
Prepaid expenses and other assets		13,463
Total Assets		120,610,003

LIABILITIES:
Payable for fund shares redeemed		75,647
Payable to advisor		73,035
Payable to administrator		26,765
Payable to auditor		17,724
Accrued service fees		8,648
Accrued interest payable		70
Accrued trustees fees		2,318
Accrued expenses and other payables		17,310
Total Liabilities		221,517
NET ASSETS	$	120,388,486

NET ASSETS CONSIST OF:
Capital stock	$	78,151,194
Accumulated net investment income		1,313,651
Accumulated net realized gain on investments		15,634,422
Unrealized net appreciation on investments		25,289,219
Total Net Assets	$	120,388,486

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares	$	105,507,323
Shares issued and outstanding		6,958,995
Net asset value, offering price and redemption price per share	$	15.16

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares	$	14,881,163
Shares issued and outstanding		972,624
Net asset value, offering price and redemption price per share	$	15.30

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Operations for the year ended October 31, 2014

INVESTMENT INCOME:
Dividend income	$	2,608,449
Interest income		395
Total investment income		2,608,844

EXPENSES:
Investment advisory fees (See Note 5)		850,623
Administration, fund accounting, custody and transfer agent fees		204,095
Service fees – Investor Class (See Note 5)		98,700
Sub-transfer agent expenses – Investor Class (See Note 5)		39,712
Sub-transfer agent expenses – Institutional Class (See Note 5)		7,497
Federal and state registration fees		33,123
Compliance expense		21,487
Audit fees		16,736
Reports to shareholders		12,800
Trustees’ fees and expenses		9,821
Legal fees		2,248
Other expenses		11,357
Total expenses before waiver		1,308,199
Administrative expense waiver (See Note 5)		(13,018	)
Net expenses		1,295,181
NET INVESTMENT INCOME	$	1,313,663

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	18,680,208
Net change in unrealized depreciation on investments		(586,375	)
Net gain on investments		18,093,833
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	19,407,496

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

HENNESSYFUNDS.COM

Financial Statements

Statements of Changes in Net Assets

	Year Ended			Year Ended
	October 31, 2014			October 31, 2013
OPERATIONS:
Net investment income	$	1,313,663		$	1,194,449
Net realized gain on investments		18,680,208			6,201,807
Net change in unrealized
appreciation (depreciation) on investments		(586,375	)		17,304,019
Net increase in net assets resulting from operations		19,407,496			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		(781,019	)		(52,078	)
Total distributions		(6,372,510	)		(1,249,856	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		11,881,168			1,740,370
Proceeds from shares subscribed – Institutional Class		4,305,238			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		(11,322,920	)		(8,522,055	)
Cost of shares redeemed – Institutional Class		(8,441,558	)(1)		(23,485,757	)
Net increase (decrease) in net assets derived
from capital share transactions		2,393,133			(28,265,238	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		15,428,119			(4,814,819	)

NET ASSETS:
Beginning of year		104,960,367			109,775,186
End of year	$	120,388,486		$	104,960,367
Undistributed net investment income, end of year	$	1,313,651		$	1,194,434

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		822,355			149,494
Shares sold – Institutional Class		298,334			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		(783,194	)		(720,532	)
Shares redeemed – Institutional Class		(579,248	)		(2,050,571	)
Net increase (decrease) in shares outstanding		204,001			(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 year ended October 31, 2014.

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Financial Highlights

For an Investor Class share outstanding throughout each year

PER SHARE DATA:

Net asset value, beginning of year

Income from investment operations:

Net investment income

Net realized and unrealized gains on investments

Total from investment operations

Less distributions:

Dividends from net investment income

Dividends from net realized gains

Total distributions

Net asset value, end of year

TOTAL RETURN

SUPPLEMENTAL DATA AND RATIOS:

Net assets, end of year (millions)

Ratio of expenses to average net assets:

Before expense reimbursement

After expense reimbursement

Ratio of net investment income to average net assets:

Before expense reimbursement

After expense reimbursement

Portfolio turnover rate(1)

(1)	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,
2014			2013			2012			2011			2010

$	13.56		$	10.77		$	12.37		$	11.70		$	9.49


	0.15			0.14			0.13			0.09			0.09
	2.28			2.77			0.80			0.69			2.17
	2.43			2.91			0.93			0.78			2.26


	(0.15	)		(0.10	)		(0.07	)		(0.09	)		(0.05	)
	(0.68	)		(0.02	)		(2.46	)		(0.02	)		—
	(0.83	)		(0.12	)		(2.53	)		(0.11	)		(0.05	)
$	15.16		$	13.56		$	10.77		$	12.37		$	11.70

	18.73	%		27.32	%		9.14	%		6.70	%		23.88	%


$	105.51		$	88.77		$	75.83		$	77.88		$	78.83

	1.15	%		1.19	%		1.27	%		1.26	%		1.30	%
	1.15	%		1.19	%		1.27	%		1.30	%		1.30	%

	1.12	%		1.10	%		1.35	%		0.72	%		0.84	%
	1.12	%		1.10	%		1.35	%		0.68	%		0.84	%
	57	%		73	%		0	%		70	%		83	%

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Financial Highlights

For an Institutional Class share outstanding throughout each year

PER SHARE DATA:

Net asset value, beginning of year

Income from investment operations:

Net investment income

Net realized and unrealized gains on investments

Total from investment operations

Less distributions:

Dividends from net investment income

Dividends from net realized gains

Total distributions

Net asset value, end of year

TOTAL RETURN

SUPPLEMENTAL DATA AND RATIOS:

Net assets, end of year (millions)

Ratio of expenses to average net assets:

Before expense reimbursement

After expense reimbursement

Ratio of net investment income to average net assets:

Before expense reimbursement

After expense reimbursement

Portfolio turnover rate(1)

(1) 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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Year Ended October 31,
2014			2013			2012			2011			2010

$	13.68		$	10.85		$	12.44		$	11.76		$	9.51


	0.17			0.09			0.07			0.08			0.10
	2.30			2.88			0.89			0.74			2.20
	2.47			2.97			0.96			0.82			2.30


	(0.17	)		(0.12	)		(0.09	)		(0.12	)		(0.05	)
	(0.68	)		(0.02	)		(2.46	)		(0.02	)		—
	(0.85	)		(0.14	)		(2.55	)		(0.14	)		(0.05	)
$	15.30		$	13.68		$	10.85		$	12.44		$	11.76

	18.96	%		27.63	%		9.43	%		6.99	%		24.26	%


$	14.88		$	16.19		$	33.94		$	0.14		$	0.07

	1.06	%		1.10	%		1.41	%		1.14	%		1.16	%
	0.98	%		0.98	%		0.98	%		0.98	%		0.98	%

	1.21	%		1.38	%		6.44	%		0.81	%		0.90	%
	1.30	%		1.50	%		6.87	%		0.97	%		1.08	%
	57	%		73	%		0	%		70	%		83	%

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Notes to Financial Statements October 31, 2014

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 an individual class.

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.
	Due to inherent differences in the recognition of income, expenses, and realized gains/losses under GAAP and federal income tax regulations, permanent differences between book and tax basis reporting for the 2014 fiscal year have been identified and appropriately reclassified on the Statement of Assets and Liabilities. The adjustments are as follow:

Undistributed	Accumulated
Net Investment	Net Realized
Income/(Loss)	Gain/(Loss)	Paid-in Capital
$(12)	$12	$ —

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 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 NAV per share.

h).	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 to cover the repurchase amount 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.

i).	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 tax returns of the Fund for the prior three fiscal years are open for examination. 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.

j).	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

HENNESSY FUNDS 1-800-966-4354

	“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 fiscal year ended October 31, 2014, the Fund did not hold any derivative instruments.

k).	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 October 31, 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 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.

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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 generally 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 generally valued at amortized cost, which approximates fair market value, 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. Amortized cost is not used if its use would be inappropriate due to credit or other impairments of the issuer, in which the security would be fair valued, as described below. 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 for a security that reflects amount the Fund might reasonably expect to receive in a current sale. 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.

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.

HENNESSY FUNDS 1-800-966-4354

investing in those securities. Details related to the fair valuation hierarchy of the Fund’s securities as of October 31, 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 fiscal year ended October 31, 2014 were $63,590,504 and $68,256,488, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund during the fiscal year ended October 31, 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 October 31, 2014 were $73,035.

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.

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-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 service fees payable for the Fund as of October 31, 2014 were $8,648.

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 fiscal year ended October 31, 2014 were $47,209.

HENNESSYFUNDS.COM

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 fiscal year ended October 31, 2014 were $191,077.

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 fiscal year ended October 31, 2014 were $13,018.

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 fiscal year ended October 31, 2014, the Fund did not have any borrowings outstanding under the line of credit.

7). FEDERAL TAX INFORMATION

As of October 31, 2014, the components of accumulated earnings (losses) for income tax purposes were as follow:

Cost of investments for tax purposes	$	95,240,010
Gross tax unrealized appreciation	$	26,854,958
Gross tax unrealized depreciation		(1,615,759	)
Net tax unrealized appreciation	$	25,239,199
Undistributed ordinary income	$	1,313,651
Undistributed long-term capital gains		17,714,948
Total distributable earnings	$	19,028,599
Other accumulated loss	$	(2,030,506	)
Total accumulated gain	$	42,237,292

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to wash sales.

At October 31, 2014, the Fund had capital loss carryforwards of $2,030,506 that expire on October 31, 2016.

During the year ended October 31, 2014, 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 loss incurred during those taxable years will be required to be utilized prior to the losses incurred in taxable years prior to 2012. 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.

HENNESSY FUNDS 1-800-966-4354

At October 31, 2014, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals.

The tax character of distributions paid during fiscal year 2014 and fiscal year 2013 for the Fund were as follow:

	Year Ended		Year Ended
	October 31, 2014		October 31, 2013
Ordinary income	$	1,205,688	$	1,080,469
Long-term capital gain		5,166,822		169,387
	$	6,372,510	$	1,249,856

8). EVENTS SUBSEQUENT TO YEAR-END

On December 8, 2014, a long-term capital gains distribution of $2.23720 per share for the Investor Class and $2.25762 per share for the Institutional Class were declared and paid to shareholders of record on December 5, 2014.

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Report of Independent Registered Public Accounting Firm

The Board of Trustees and Shareholders

Hennessy Funds Trust:

We have audited the accompanying statement of assets and liabilities of Hennessy Cornerstone Large Growth Fund (the Fund), a series of Hennessy Funds Trust, including the schedule of investments, as of October 31, 2014, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Fund as of October 31, 2014, and the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

Milwaukee, Wisconsin

December 30, 2014

HENNESSY FUNDS 1-800-966-4354

Trustees and Officers of the Fund (Unaudited)

The business and affairs of the Fund are managed under the direction of the Fund’s Board of Trustees. Information pertaining to the Trustees and Officers of the Fund is set forth below. The Fund’s Statement of Additional Information includes additional information about the Fund’s Trustees and Officers and is available, without charge, upon request by calling 1-800-966-4354.

				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

Disinterested Trustees (as defined below)

J. Dennis DeSousa	Trustee	Indefinite,	Mr. DeSousa is a real	16	Hennessy SPARX
Age: 78		until	estate investor.		Funds Trust;
Address:		successor			Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Robert T. Doyle	Trustee	Indefinite,	Mr. Doyle has been the	16	Hennessy SPARX
Age: 67		until	Sheriff of Marin County,		Funds Trust;
Address:		successor	California since 1996.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Gerald P. Richardson	Trustee	Indefinite,	Mr. Richardson is an	16	Hennessy SPARX
Age: 69		until	independent consultant		Funds Trust;
Address:		successor	in the securities industry.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		May 2004
		for the
		Funds (or
		Predecessor
		Funds)

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				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

“Interested Persons” (as defined in the 1940 Act)

Neil J. Hennessy(1)	Chief	Trustee:	Mr. Hennessy has been	16	Hennessy
Age: 58	Investment	Indefinite,	employed by Hennessy		Advisors, Inc.
Address:	Officer,	until	Advisors, Inc., the Funds’		(current);
c/o Hennessy	Portfolio	successor	investment advisor, since		Hennessy SPARX
Advisors, Inc.	Manager,	elected	1989. He currently serves		Funds Trust;
7250 Redwood Blvd.	President,		as President, Chairman		Hennessy Mutual
Suite 200	Trustee	Served	and CEO of Hennessy		Funds, Inc.; and
Novato, CA 94945	and	since	Advisors, Inc.		The Hennessy
	Chairman	January			Funds, Inc.
	of the	1996
	Board	for the
		Funds (or
		Predecessor
		Funds)

		Officer:
		1 year term

		Served
		since
		June 2008
		for the
		Funds (or
		Predecessor
		Funds)

Teresa M. Nilsen(1)	Executive	1 year term	Ms. Nilsen has been	N/A	N/A
Age: 48	Vice		employed by Hennessy
Address:	President	Served	Advisors, Inc., the Funds’
c/o Hennessy	and	since	investment advisor, since
Advisors, Inc.	Treasurer	January	1989. She currently serves
7250 Redwood Blvd.		1996	as Executive Vice President,
Suite 200		for the	Chief Operations Officer,
Novato, CA 94945		Funds (or	Chief Financial Officer, and
		Predecessor	Secretary of Hennessy
		Funds)	Advisors, Inc.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.
(2)	Pursuant to an internal reorganization, the series of Hennessy Mutual Funds, Inc. (“HMFI”), The Hennessy Funds, Inc. (“HFI”) and Hennessy SPARX Funds Trust (“HSFT”) were reorganized into series of Hennessy Funds Trust on February 28, 2014, which mirrored the corresponding series of HFMI, HFI and HSFT. Subsequent to the reorganization, HFMI, HFI and HSFT were dissolved.

HENNESSY FUNDS 1-800-966-4354

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Daniel B. Steadman(1)	Executive	1 year term	Mr. Steadman has been employed by
Age: 58	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Secretary	Served since	investment advisor, since 2000.
c/o Hennessy Advisors, Inc.		March 2000	He currently serves as Executive
7250 Redwood Blvd.		for the Funds (or	Vice President and Chief Compliance
Suite 200		Predecessor Funds)	Officer of Hennessy Advisors, Inc.
Novato, CA 94945

Jennifer Cheskiewicz(1)	Senior	1 year term	Ms. Cheskiewicz has been employed by
Age: 37	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Chief	Served since	investment advisor, since June 2013.
c/o Hennessy Advisors, Inc.	Compliance	June 2013	She previously served as in-house
7250 Redwood Blvd.	Officer	for the Funds (or	counsel to Carlson Capital, L.P., an
Suite 200		Predecessor Funds)	SEC-registered investment advisor to
Novato, CA 94945			several private funds from February
			2010 to May 2013. Prior to that, she
			was an attorney with Gibson, Dunn &
			Crutcher LLP from September 2005
			through February 2010. She currently
			serves as General Counsel of
			Hennessy Advisors, Inc.

Brian Carlson(1)	Senior	1 year term	Mr. Carlson has been employed by
Age: 42	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Head of	Served since	investment advisor, since
c/o Hennessy Advisors, Inc.	Distribution	December 2013	December 2013.
7250 Redwood Blvd.		for the Funds (or
Suite 200		Predecessor Funds)	Mr. Carlson was previously a
Novato, CA 94945			co-founder and principal of Trivium
			Consultants, LLC from February 2011
			through November 2013. Prior to that,
			he was the Senior Managing Director
			of NRP Financial, Inc. from August
			2007 through February 2011.

David Ellison(1)	Portfolio Manager	1 year term	Mr. Ellison has served as Portfolio
Age: 56	and Senior		Manager of the Large Cap Financial
Address:	Vice President	Served since	Fund, the Small Cap Financial Fund,
c/o Hennessy Advisors, Inc.		October 2012	and the Technology Fund
101 Federal Street		for the Funds (or	since inception.
Suite 1900		Predecessor Funds)
Boston, MA 02110			Mr. Ellison previously served as Director,
			CIO and President of FBR Advisers, Inc.
			from December 1999 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSYFUNDS.COM

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Brian Peery(1)	Portfolio Manager	1 year term	Mr. Peery has been a Portfolio Manager
Age: 45	and		of the Cornerstone Growth Fund,
Address:	Vice President	Served since	the Cornerstone Mid Cap 30 Fund, the
c/o Hennessy Advisors, Inc.		March 2003	Cornerstone Large Growth Fund, the
7250 Redwood Blvd.		as Vice President	Cornerstone Value Fund, the Total
Suite 200		for the Funds (or	Return Fund, and the Balanced Fund
Novato, CA 94945		Predecessor Funds)	since October 2014. From February
			2011 through September 2014, he
		Served since	served as Co-Portfolio Manager of
		February 2011	the same funds.
		as Co-Portfolio
		Manager	Mr. Peery has been employed by
		for the Funds (or	Hennessy Advisors, Inc., the Funds’
		Predecessor Funds)	investment advisor, since 2002.

Winsor (Skip) Aylesworth(1)	Portfolio Manager	1 year term	Mr. Aylesworth has been Portfolio
Age: 67	and		Manager of the Gas Utility Index Fund
Address:	Vice President	Served since	since 1998 and Portfolio Manager of
c/o Hennessy Advisors, Inc.		October 2012	the Technology Fund since inception.
101 Federal Street		for the Funds (or
Suite 1900		Predecessor Funds)	Mr. Aylesworth previously served as
Boston, MA 02110			Executive Vice President of The FBR
			Funds from 1999 to October 2012.

Ryan Kelley(1)	Portfolio Manager	1 year term	Mr. Kelley has been a Portfolio Manager
Age: 42	and		of the Gas Utility Index Fund (formerly
Address:	Vice President	Served since	the FBR Gas Utility Index Fund), the
c/o Hennessy Advisors, Inc.		March 2013	Small Cap Financial Fund (formerly the
1340 Environ Way		for the Funds (or	FBR Small Cap Financial Fund), and the
Chapel Hill, NC 27517		Predecessor Funds)	Large Cap Financial Fund (formerly the
			FBR Large Cap Financial Fund) since
			October 2014. From March 2013
			through September 2014, he served
			as a Co-Portfolio Manager of the same
			funds. Prior to that, he was a Portfolio
			Analyst of the Hennessy Funds.

			Mr. Kelley previously served as Portfolio
			Manager of The FBR Funds from
			January 2008 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSY FUNDS 1-800-966-4354

Expense Example (Unaudited)

October 31, 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 May 1, 2014 through October 31, 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.

HENNESSYFUNDS.COM

	Beginning	Ending	Expenses Paid
	Account Value	Account Value	During Period(1)
	5/1/14	10/31/14	5/1/14 – 10/31/14
Investor Class

Actual	$1,000.00	$1,053.50	$5.80

Hypothetical (5% return
before expenses)	$1,000.00	$1,019.56	$5.70

Institutional Class

Actual	$1,000.00	$1,054.40	$5.07

Hypothetical (5% return
before expenses)	$1,000.00	$1,020.27	$4.99

(1)	Expenses are equal to the Fund's expense ratio of 1.12% for Investor Class shares or 0.98% for Institutional Class shares, as applicable, multiplied by the average account value over the period, multiplied by 184/365 days (to reflect one-half year period).

HENNESSY FUNDS 1-800-966-4354

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, 2014, certain dividends paid by the Fund may be subject to a maximum tax rate of 20%, 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, 2014 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.

HENNESSYFUNDS.COM

We collect the following non-public personal information about you:

	•	information we receive from you on or in applications or other forms, correspondence, or conversations, including, but not limited to, your name, address, phone number, social security number, assets, income and date of birth;
		and
	•	information about your transactions with us, our affiliates, or others, including, but not limited to, your account number and balance, payment history, parties to transactions, cost basis information and other financial information.

We do not disclose any non-public personal information about our current or former shareholders to nonaffiliated third parties, except as permitted by law. For example, we are permitted by law to disclose all of the information we collect, as described above, to our Transfer Agent to process your transactions. Furthermore, we restrict access to your non-public personal information to those persons who require such information to provide products or services to you. We maintain physical, electronic and procedural safeguards that comply with federal standards to guard your non-public personal information.

In the event that you hold shares of the Fund through a financial intermediary, including, but not limited to, a broker-dealer, bank or trust company, the privacy policy of your financial intermediary would govern how your non-public personal information would be shared with nonaffiliated third parties.

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.

ANNUAL REPORT

OCTOBER 31, 2014

HENNESSY TOTAL RETURN FUND

Investor Class HDOGX

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		11
Statement of Operations		12
Statements of Changes in Net Assets		14
Statement of Cash Flows		15
Financial Highlights		16
Notes to the Financial Statements		18
Report of Independent Registered Public Accounting Firm		26
Trustees and Officers of the Fund		27
Expense Example		32
Proxy Voting		34
Quarterly Filings on Form N-Q		34
Federal Tax Distribution Information		34
Householding		34
Privacy Policy		35

HENNESSY FUNDS 1-800-966-4354

December 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 Index 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)

CHANGE IN VALUE OF $10,000 INVESTMENT

This chart assumes an initial gross investment of $10,000 made on October 31, 2004. Returns shown include the reinvestment of all dividends. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED OCTOBER 31, 2014

	One	Five	Ten
	Year	Years	Years
Hennessy Total
Return Fund (HDOGX)	8.15%	12.49%	5.93%
75/25 Blended DJIA/Treasury Index*	10.78%	11.47%	6.87%
Dow Jones Industrial Average	14.48%	15.30%	8.42%

Expense ratio: 1.37%

The expense ratio presented is from the most recent prospectus.

*	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 U.S. Treasury Bill Index.

HENNESSYFUNDS.COM

PERFORMANCE NARRATIVE

Portfolio Managers Neil Hennessy and Brian Peery

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

For the twelve-month period ended October 31, 2014, the Hennessy Total Return Fund returned 8.15%, underperforming the 75/25 Blended DJIA/Treasury Index*, the Dow Jones Industrial Average and the Morningstar Large Value Category Average, which returned 10.78%, 14.48% and 13.60% for the same period, respectively.

While the Fund’s roughly 25% weighting in U.S. Treasuries was a detriment to overall performance compared to its equity benchmarks, the Fund’s relative underperformance compared to the 75/25 Blended DJIA/Treasury Index was due to stock selection. Four names which added strongly to the overall performance of the Dow Jones Industrial Average were not present in our portfolio due to their low dividend yields: UnitedHealth Group, Inc., Nike, Inc., The Walt Disney Company and Home Depot, Inc., all of which posted returns north of 20% for the year.

During the period, 15 of the Fund’s 19 equity positions had positive returns, with only Pfizer, Hewlett-Packard Company, McDonald’s and Kraft Foods Group, Inc. posting negative returns. Although Hewlett-Packard Company and Kraft Foods Group, Inc. are no longer members of the Dow Jones Industrial Average, both stocks remained in the Fund’s portfolio until the Fund was rebalanced. When the portfolio was rebalanced, the newest “Dogs of the Dow” stocks replaced those stocks no longer in the index.

While the Fund’s portfolio may underperform its benchmarks in periods where equities rise sharply, the strategy attempts to capture near market returns with a lower risk profile, since only approximately 75% of the Fund’s assets 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 25% exposure to short-term U.S. Treasuries. Ultimately, the overall goal of this portfolio is to capture near-market upside performance while mitigating some of the potential market downside risk.

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 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 generating current income. We believe that the rotation out of bonds and into equities, where investors have historically received higher yields and have the potential for capital appreciation, will likely continue.

As the market reaches 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 should prevail. We believe the Fund is well positioned for the more moderately conservative investor, as the equity portion of the portfolio holds what we would deem to be high-quality, high dividend-paying companies, while the short duration of the Treasury component (all less than three months) will allow us the ability to roll into higher yielding treasuries in the event yields continue to rise.

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 U.S. Treasury Bill Index. The Dow Jones Industrial Average is an unmanaged index commonly used to measure the performance of U.S. stocks. The BofA Merrill Lynch 90-day

HENNESSY FUNDS 1-800-966-4354

U.S. Treasury Bill Index is an unmanaged index of Treasury securities maturing in 90 days. 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.

HENNESSYFUNDS.COM

Financial Statements

Schedule of Investments

HENNESSY TOTAL RETURN FUND

As of October 31, 2014

(% of Net Assets)

TOP TEN HOLDINGS	% NET ASSETS

U.S. Treasury Bill, 0.010%, 01/15/2015	27.42%
U.S. Treasury Bill, 0.010%, 12/26/2014	21.46%
U.S. Treasury Bill, 0.030%, 11/20/2014	14.30%
Merck & Co., Inc.	7.46%
Verizon Communications, Inc.	7.23%
Pfizer, Inc.	7.03%
Chevron Corp.	6.98%
McDonald’s Corp.	6.92%
AT&T, Inc.	6.91%
Procter & Gamble Co.	6.19%

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS – 73.30%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 6.92%
McDonald’s Corp.		61,900	$	5,801,887		6.92	%

Consumer Staples – 9.26%
Procter & Gamble Co.		59,500		5,192,565		6.19	%
The Coca-Cola Co.		61,600		2,579,808		3.07	%
				7,772,373		9.26	%

Energy – 9.10%
Chevron Corp.		48,800		5,853,560		6.98	%
Exxon Mobil Corp.		18,400		1,779,464		2.12	%
				7,633,024		9.10	%

Health Care – 14.49%
Merck & Co., Inc.		108,100		6,263,314		7.46	%
Pfizer, Inc.		196,900		5,897,155		7.03	%
				12,160,469		14.49	%

Industrials – 5.92%
General Electric Co.		192,300		4,963,263		5.92	%

Information Technology – 12.01%
Cisco Systems, Inc.		211,100		5,165,617		6.16	%
Intel Corp.		100,700		3,424,807		4.08	%
Microsoft Corp.		31,700		1,488,315		1.77	%
				10,078,739		12.01	%

Materials – 1.46%
EI Du Pont de Nemours & Co.		17,700		1,223,955		1.46	%

Telecommunication Services – 14.14%
AT&T, Inc.		166,400		5,797,376		6.91	%
Verizon Communications, Inc.		120,700		6,065,175		7.23	%
				11,862,551		14.14	%

Total Common Stocks
(Cost $50,493,028)				61,496,261		73.30	%

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

HENNESSYFUNDS.COM

SHORT-TERM INVESTMENTS – 66.49%	Number of Shares/					% of
	Par Amount		Value			Net Assets
Money Market Funds – 3.31%
Fidelity Government Portfolio –
Institutional Class, 0.01% (a)		2,777,460	$	2,777,460			3.31	%

U.S. Treasury Bills (c) – 63.18%
0.030%, 11/20/2014 (b)		12,000,000		11,999,873			14.30	%
0.010%, 12/26/2014 (b)		18,000,000		17,999,972			21.46	%
0.010%, 01/15/2015 (b)		23,000,000		22,999,541			27.42	%
				52,999,386			63.18	%

Total Short-Term Investments
(Cost $55,776,827)				55,776,846			66.49	%

Total Investments
(Cost $106,269,855) – 139.79%				117,273,107			139.79	%
Liabilities in Excess
of Other Assets – (39.79)%				(33,378,316	)		(39.79	)%
TOTAL NET ASSETS – 100.00%			$	83,894,791			100.00	%

Percentages are stated as a percent of net assets.

	(a)	The rate listed is the fund’s 7-day yield as of October 31, 2014.
	(b)	The rate listed is discount rate at issue.
	(c)	Collateral or partial collateral for securities sold subject to repurchase.

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

HENNESSY FUNDS 1-800-966-4354

Summary of Fair Value Exposure at October 31, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of October 31, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stocks	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	5,801,887	$	—	$	—	$	5,801,887
Consumer Staples		7,772,373		—		—		7,772,373
Energy		7,633,024		—		—		7,633,024
Health Care		12,160,469		—		—		12,160,469
Industrials		4,963,263		—		—		4,963,263
Information Technology		10,078,739		—		—		10,078,739
Materials		1,223,955		—		—		1,223,955
Telecommunication Services		11,862,551		—		—		11,862,551
Total Common Stocks	$	61,496,261	$	—	$	—	$	61,496,261
Short-Term Investments
Money Market Funds	$	2,777,460	$	—	$	—	$	2,777,460
U.S. Treasury Bills		—		52,999,386		—		52,999,386
Total Short-Term Investments	$	2,777,460	$	52,999,386	$	—	$	55,776,846
Total Investments in Securities	$	64,273,721	$	52,999,386	$	—	$	117,273,107

Transfers between levels are recognized at the end of the reporting period. During the one-year period ended October 31, 2014, the Fund recognized no transfers between levels.

Schedule of Reverse Repurchase Agreements

				Principal	Maturity	Maturity
Face Value		Counterparty	Rate	Trade Date	Date	Amount
$	8,095,500	Jefferies LLC	0.25%	8/22/14	11/20/14	$	8,100,560
	10,794,000	Jefferies LLC	0.25%	9/26/14	12/26/14		10,800,821
	14,392,000	Jefferies LLC	0.25%	10/17/14	1/15/15		14,400,995
$	33,281,500					$	33,302,376

As of October 31, 2014, the fair value of securities held as collateral for reverse repurchase agreements was $52,999,386 as noted on the Schedule of Investments.

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

HENNESSYFUNDS.COM

Financial Statements

Statement of Assets and Liabilities as of October 31, 2014

ASSETS:
Investments in securities, at value (cost $106,269,855)	$	117,273,107
Cash		570
Dividends and interest receivable		181,245
Receivable for fund shares sold		33,150
Prepaid expenses and other assets		9,830
Total Assets		117,497,902

LIABILITIES:
Payable for fund shares redeemed		124,019
Payable to advisor		41,899
Payable to administrator		18,925
Payable to auditor		18,590
Accrued distribution fees		62,177
Accrued service fees		6,983
Reverse repurchase agreements		33,281,500
Accrued interest payable		7,958
Accrued trustees fees		1,732
Accrued expenses and other payables		39,328
Total Liabilities		33,603,111
NET ASSETS	$	83,894,791

NET ASSETS CONSIST OF:
Capital stock	$	67,153,473
Accumulated net investment income		111,389
Accumulated net realized gain on investments		5,626,677
Unrealized net appreciation on investments		11,003,252
Total Net Assets	$	83,894,791

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares	$	83,894,791
Shares issued and outstanding		5,493,576
Net asset value, offering price and redemption price per share	$	15.27

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Operations for the year ended October 31, 2014

INVESTMENT INCOME:
Dividend income	$	2,260,573
Interest income		15,008
Total investment income		2,275,581

EXPENSES:
Investment advisory fees (See Note 5)		515,887
Administration, fund accounting, custody and transfer agent fees		155,721
Distribution fees – Investor Class (See Note 5)		128,971
Service fees – Investor Class (See Note 5)		85,981
Interest expense (See Notes 6 and 8)		84,410
Sub-transfer agent expenses – Investor Class (See Note 5)		74,290
Federal and state registration fees		27,895
Compliance expense		21,488
Audit fees		20,557
Reports to shareholders		16,655
Trustees’ fees and expenses		6,682
Legal fees		1,870
Other expenses		10,469
Total expenses		1,150,876
NET INVESTMENT INCOME	$	1,124,705

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	7,876,199
Net change in unrealized depreciation on investments		(2,312,252	)
Net gain on investments		5,563,947
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	6,688,652

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

HENNESSYFUNDS.COM

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HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statements of Changes in Net Assets

	Year Ended			Year Ended
	October 31, 2014			October 31, 2013
OPERATIONS:
Net investment income	$	1,124,705		$	945,157
Net realized gain on investments		7,876,199			4,930,184
Net change in unrealized
appreciation (depreciation) on investments		(2,312,252	)		4,920,747
Net increase in net assets resulting from operations		6,688,652			10,796,088

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income – Investor Class		(1,079,733	)		(957,145	)
Total distributions		(1,079,733	)		(957,145	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		6,812,637			21,431,210
Dividends reinvested – Investor Class		1,006,867			873,732
Cost of shares redeemed – Investor Class		(19,774,754	)		(19,573,550	)
Net increase (decrease) in net assets derived
from capital share transactions		(11,955,250	)		2,731,392
TOTAL INCREASE (DECREASE) IN NET ASSETS		(6,346,331	)		12,570,335

NET ASSETS:
Beginning of year		90,241,122			77,670,787
End of year	$	83,894,791		$	90,241,122
Undistributed net investment income, end of year	$	111,389		$	66,417

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		461,575			1,551,829
Shares issued to holders as
reinvestment of dividends – Investor Class		67,319			64,334
Shares redeemed – Investor Class		(1,344,123	)		(1,451,726	)
Net increase (decrease) in shares outstanding		(815,229	)		164,437

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

HENNESSYFUNDS.COM

Financial Statements

Statement of Cash Flows for the Year Ended October 31, 2014

Cash flows from operating activities:
Net increase in net assets from operations	$	6,688,652
Adjustments to reconcile net increase in net assets from
operations to net cash provided by operating activities:
Payments to purchase securities		(14,437,534	)
Proceeds from sale of securities		22,729,643
Purchase sale of short term investments, net		4,570,835
Realized gain on investments in securities		(7,876,199	)
Net accretion of discount on securities		(14,780	)
Change in unrealized depreciation on investments in securities		2,312,252
Increases decreases in operating assets:
Increase in dividends and interest receivable		(22,384	)
Decrease in prepaid expenses and other assets		7,727
Increases (decreases) in operating liabilities:
Decrease in payable to advisor		(3,444	)
Decrease in payable to administrator		(24,621	)
Increase in accrued distribution fees		9,201
Decrease in accrued service fees		(574	)
Decrease in accrued interest payable		(2,169	)
Increase in accrued audit fees		1,723
Decrease in accrued trustee fees		(2	)
Increase in other accrued expenses and payables		3,828
Net cash provided by operating activities		13,942,154

Cash flows from financing activities:
Increase in reverse repurchase agreements		(899,500	)
Proceeds from shares sold		6,806,742
Payment on shares redeemed		(19,775,960	)
Distributions paid in cash, net of reinvestments		(72,866	)
Net cash used in financing activities		(13,941,584	)
Net increase in cash		570

Cash:
Beginning balance		—
Ending balance	$	570

Supplemental information:
Non-cash financing activities consisting of
reinvestment of dividends and distributions	$	1,006,867
Proceeds from securities litigation		55,442

Cash paid for interest	$	86,579

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Financial Highlights

For an Investor Class share outstanding throughout each year

PER SHARE DATA:

Net asset value, beginning of year

Income from investment operations:

Net investment income

Net realized and unrealized gains on investments

Total from investment operations

Less distributions:

Dividends from net investment income

Total distributions

Net asset value, end of year

TOTAL RETURN

SUPPLEMENTAL DATA AND RATIOS:

Net assets, end of year (millions)

Gross ratio of expenses, including interest expense, to average net assets

Ratio of interest expense to average net assets

Net ratio of expenses, excluding interest expense, to average net assets

Ratio of net investment income to average net assets

Portfolio turnover rate

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

HENNESSYFUNDS.COM

Year Ended October 31,
2014			2013			2012			2011			2010

$	14.30		$	12.64		$	11.47		$	10.57		$	9.10


	0.20			0.16			0.18			0.18			0.16
	0.96			1.66			1.17			0.89			1.48
	1.16			1.82			1.35			1.07			1.64


	(0.19	)		(0.16	)		(0.18	)		(0.17	)		(0.17	)
	(0.19	)		(0.16	)		(0.18	)		(0.17	)		(0.17	)
$	15.27		$	14.30		$	12.64		$	11.47		$	10.57

	8.15	%		14.49	%		11.78	%		10.22	%		18.09	%


$	83.89		$	90.24		$	77.67		$	64.13		$	69.08
	1.34	%		1.37	%		1.37	%		1.34	%		1.33	%
	0.10	%		0.10	%		0.08	%		0.10	%		0.08	%
	1.24	%		1.27	%		1.29	%		1.24	%		1.25	%
	1.31	%		1.16	%		1.44	%		1.56	%		1.62	%
	23	%		31	%		22	%		21	%		41	%

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Notes to Financial Statements October 31, 2014

1). ORGANIZATION

The Hennessy Total Return 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 total return, consisting 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

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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 NAV per share.

h).	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 to cover the repurchase amount 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.

i).	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 tax returns of the Fund for the prior three fiscal years are open for examination. 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.

j).	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 fiscal year ended October 31, 2014, the Fund did not hold any derivative instruments.

HENNESSY FUNDS 1-800-966-4354

k).	Offsetting Assets and Liabilities – The Fund has adopted financial reporting rules regarding offsetting assets and liabilities and related netting arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. Reverse repurchase transactions are entered into by the Fund under Master Repurchase Agreements (“MRA”) that permit the Fund, under certain circumstances, including an event of default (such as bankruptcy or insolvency), to offset payables under the MRA with collateral held with the counterparty and create one single net payment from the Fund. Upon a bankruptcy or insolvency of the MRA counterparty, the Fund is considered an unsecured creditor with respect to excess collateral and, as such, the return of excess collateral may be delayed. In the event the buyer of securities under an MRA files for bankruptcy or becomes insolvent, the Fund’s use of the proceeds of the agreement may be restricted while the other party, or its trustee or receiver, determines whether or not to enforce the Fund’s obligation to repurchase the securities. For additional information regarding the offsetting of assets and liabilities at October 31, 2014, please reference the table in Note 8.

l).	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 October 31, 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.

m).	New Accounting Pronouncements – In June 2014, the Financial Accounting Standard Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2014-11 “Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosure.” ASU No. 2014-11 makes limited changes to the accounting for repurchase agreements, clarifies when repurchase agreements and securities lending transactions should be accounting for as secured borrowings, and requires additional disclosures regarding these types of transactions. The guidance is effective for fiscal years beginning on or after December 15, 2014, and for interim periods within those fiscal years. Management is currently evaluating the impact ASU No. 2014-11 will have on the financial statement disclosures.

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

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		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.

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 generally 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 generally 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.

HENNESSY FUNDS 1-800-966-4354

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 for a security that reflects the amount the Fund might reasonably expect to receive in a current sale. 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.

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 October 31, 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 fiscal year ended October 31, 2014 were $14,437,534 and $22,674,201, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund during the fiscal year ended October 31, 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 October 31, 2014 were $41,899.

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 service fees payable for the Fund as of October 31, 2014 were $6,983.

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.

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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 fiscal year ended October 31, 2014 were $74,290.

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 fiscal year ended October 31, 2014 were $155,721.

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 fiscal year ended October 31, 2014, the Fund had an outstanding average daily balance and a weighted average interest rate of $735 and 3.25%, respectively. The maximum amount outstanding for the Fund during the year was $133,000. At October 31, 2014, the Fund had a loan payable balance of $0.

7). FEDERAL TAX INFORMATION

As of October 31, 2014, the components of accumulated earnings (losses) for income tax purposes were as follow:

Cost of investments for tax purposes	$	106,410,131
Gross tax unrealized appreciation	$	11,155,779
Gross tax unrealized depreciation		(292,803	)
Net tax unrealized appreciation	$	10,862,976
Undistributed ordinary income	$	111,389
Undistributed long-term capital gains		5,766,953
Total distributable earnings	$	5,878,342
Other accumulated gain	$	—
Total accumulated gain	$	16,741,318

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to wash sales.

At October 31, 2014, the Fund had no tax basis capital losses to offset future capital gains.

During the year ended October 31, 2014, the capital loss carry forwards utilized for the Fund were $2,084,535.

HENNESSY FUNDS 1-800-966-4354

At October 31, 2014, the Fund did not defer, on a tax basis, any post-December late year ordinary loss deferrals.

The tax character of distributions paid during fiscal year 2014 and fiscal year 2013 for the Fund were as follow:

	Year Ended		Year Ended
	October 31, 2014		October 31, 2013
Ordinary income	$	1,079,733	$	957,145
Long-term capital gain		—		—
	$	1,079,733	$	957,145

8). REVERSE REPURCHASE AGREEMENTS

The Fund may enter into reverse repurchase agreements with the same parties with whom it may enter into repurchase agreements. Under a reverse repurchase agreement, the Fund sells securities and agrees to repurchase them at a mutually agreed upon date and price. Reverse repurchase agreements are regarded as a form of secured borrowing by the Fund. Securities sold under reverse repurchase agreements are reflected as a liability on the Statement of Assets and Liabilities. Interest payments made are recorded as a component of interest expense on the Statement of Operations.

For the fiscal year ended October 31, 2014, the average daily balance and average interest rate in effect for reverse repurchase agreements were $33,951,812 and 0.246%, respectively. At October 31, 2014, the interest rate in effect for the outstanding reverse repurchase agreements scheduled to mature on November 20, 2014 ($8,095,000), December 26, 2014 ($10,794,000), and January 15, 2015 ($14,392,000) was 0.25%, 0.25%, and 0.25%, respectively. Outstanding reverse repurchase agreements at October 31, 2014 were equal to 39.67% of the Fund’s net assets.

Below is the gross and net information about instruments and transactions eligible for offset in the Statement of Assets and Liabilities as well as instruments and transactions subject to an agreement similar to a master netting arrangement:

		Gross	Net
		Amounts	Amounts	Gross Amounts Not
		Offset	Presented	Offset in the Statement
		in the	in the	of Assets and Liabilities
	Gross	Statement	Statement
	Amounts of	of	of		Collateral
	Recognized	Assets and	Assets and	Financial	Pledged	Net
Description	Liabilities	Liabilities	Liabilities	Instruments	(Received)	Amount
Reverse

Repurchase
Agreements	$	33,281,500	$	—	$	33,281,500	$	33,281,500	$	—	$	—
	$	33,281,500	$	—	$	33,281,500	$	33,281,500	$	—	$	—

For additional information, please reference the “Offsetting Assets and Liabilities” section in Note 2.

9). AGREEMENT AND PLAN OF REORGANIZATION

On December 11, 2013, the Board approved an Agreement and Plan of Reorganization (the “Agreement”), of the Hennessy Total Return 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

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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
$85,203,249(1)	5,860,970	$85,203,249	$85,203,249	Non-taxable

(1)

Included accumulated realized gains and unrealized appreciation in the amounts of $221,200 and $11,758,211, respectively.

10). EVENTS SUBSEQUENT TO YEAR-END

On December 8, 2014, a long-term capital gains distribution of $1.05659 per share was declared for shareholders of record on December 5, 2014. The distribution was paid on December 8, 2014.

HENNESSY FUNDS 1-800-966-4354

Report of Independent Registered Public Accounting Firm

The Board of Trustees and Shareholders

Hennessy Funds Trust:

We have audited the accompanying statement of assets and liabilities of Hennessy Total Return Fund (the Fund), a series of Hennessy Funds Trust (formerly a series of Hennessy Mutual Funds, Inc.), including the schedule of investments, as of October 31, 2014, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, the statement of cash flows for the year then ended, and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Fund as of October 31, 2014, and the results of its operations and cash flows for the year then ended, the changes in its net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

Milwaukee, Wisconsin

December 30, 2014

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Trustees and Officers of the Fund (Unaudited)

				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

Disinterested Trustees (as defined below)

J. Dennis DeSousa	Trustee	Indefinite,	Mr. DeSousa is a real	16	Hennessy SPARX
Age: 78		until	estate investor.		Funds Trust;
Address:		successor			Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Robert T. Doyle	Trustee	Indefinite,	Mr. Doyle has been the	16	Hennessy SPARX
Age: 67		until	Sheriff of Marin County,		Funds Trust;
Address:		successor	California since 1996.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Gerald P. Richardson	Trustee	Indefinite,	Mr. Richardson is an	16	Hennessy SPARX
Age: 69		until	independent consultant		Funds Trust;
Address:		successor	in the securities industry.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		May 2004
		for the
		Funds (or
		Predecessor
		Funds)

HENNESSY FUNDS 1-800-966-4354

				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

“Interested Persons” (as defined in the 1940 Act)

Neil J. Hennessy(1)	Chief	Trustee:	Mr. Hennessy has been	16	Hennessy
Age: 58	Investment	Indefinite,	employed by Hennessy		Advisors, Inc.
Address:	Officer,	until	Advisors, Inc., the Funds’		(current);
c/o Hennessy	Portfolio	successor	investment advisor, since		Hennessy SPARX
Advisors, Inc.	Manager,	elected	1989. He currently serves		Funds Trust;
7250 Redwood Blvd.	President,		as President, Chairman		Hennessy Mutual
Suite 200	Trustee	Served	and CEO of Hennessy		Funds, Inc.; and
Novato, CA 94945	and	since	Advisors, Inc.		The Hennessy
	Chairman	January			Funds, Inc.
	of the	1996
	Board	for the
		Funds (or
		Predecessor
		Funds)

		Officer:
		1 year term

		Served
		since
		June 2008
		for the
		Funds (or
		Predecessor
		Funds)

Teresa M. Nilsen(1)	Executive	1 year term	Ms. Nilsen has been	N/A	N/A
Age: 48	Vice		employed by Hennessy
Address:	President	Served	Advisors, Inc., the Funds’
c/o Hennessy	and	since	investment advisor, since
Advisors, Inc.	Treasurer	January	1989. She currently serves
7250 Redwood Blvd.		1996	as Executive Vice President,
Suite 200		for the	Chief Operations Officer,
Novato, CA 94945		Funds (or	Chief Financial Officer, and
		Predecessor	Secretary of Hennessy
		Funds)	Advisors, Inc.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.
(2)	Pursuant to an internal reorganization, the series of Hennessy Mutual Funds, Inc. (“HMFI”), The Hennessy Funds, Inc. (“HFI”) and Hennessy SPARX Funds Trust (“HSFT”) were reorganized into series of Hennessy Funds Trust on February 28, 2014, which mirrored the corresponding series of HFMI, HFI and HSFT. Subsequent to the reorganization, HFMI, HFI and HSFT were dissolved.

HENNESSYFUNDS.COM

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Daniel B. Steadman(1)	Executive	1 year term	Mr. Steadman has been employed by
Age: 58	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Secretary	Served since	investment advisor, since 2000.
c/o Hennessy Advisors, Inc.		March 2000	He currently serves as Executive
7250 Redwood Blvd.		for the Funds (or	Vice President and Chief Compliance
Suite 200		Predecessor Funds)	Officer of Hennessy Advisors, Inc.
Novato, CA 94945

Jennifer Cheskiewicz(1)	Senior	1 year term	Ms. Cheskiewicz has been employed by
Age: 37	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Chief	Served since	investment advisor, since June 2013.
c/o Hennessy Advisors, Inc.	Compliance	June 2013	She previously served as in-house
7250 Redwood Blvd.	Officer	for the Funds (or	counsel to Carlson Capital, L.P., an
Suite 200		Predecessor Funds)	SEC-registered investment advisor to
Novato, CA 94945			several private funds from February
			2010 to May 2013. Prior to that, she
			was an attorney with Gibson, Dunn &
			Crutcher LLP from September 2005
			through February 2010. She currently
			serves as General Counsel of
			Hennessy Advisors, Inc.

Brian Carlson(1)	Senior	1 year term	Mr. Carlson has been employed by
Age: 42	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Head of	Served since	investment advisor, since
c/o Hennessy Advisors, Inc.	Distribution	December 2013	December 2013.
7250 Redwood Blvd.		for the Funds (or
Suite 200		Predecessor Funds)	Mr. Carlson was previously a
Novato, CA 94945			co-founder and principal of Trivium
			Consultants, LLC from February 2011
			through November 2013. Prior to that,
			he was the Senior Managing Director
			of NRP Financial, Inc. from August
			2007 through February 2011.

David Ellison(1)	Portfolio Manager	1 year term	Mr. Ellison has served as Portfolio
Age: 56	and Senior		Manager of the Large Cap Financial
Address:	Vice President	Served since	Fund, the Small Cap Financial Fund,
c/o Hennessy Advisors, Inc.		October 2012	and the Technology Fund
101 Federal Street		for the Funds (or	since inception.
Suite 1900		Predecessor Funds)
Boston, MA 02110			Mr. Ellison previously served as Director,
			CIO and President of FBR Advisers, Inc.
			from December 1999 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSY FUNDS 1-800-966-4354

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Brian Peery(1)	Portfolio Manager	1 year term	Mr. Peery has been a Portfolio Manager
Age: 45	and		of the Cornerstone Growth Fund,
Address:	Vice President	Served since	the Cornerstone Mid Cap 30 Fund, the
c/o Hennessy Advisors, Inc.		March 2003	Cornerstone Large Growth Fund, the
7250 Redwood Blvd.		as Vice President	Cornerstone Value Fund, the Total
Suite 200		for the Funds (or	Return Fund, and the Balanced Fund
Novato, CA 94945		Predecessor Funds)	since October 2014. From February
			2011 through September 2014, he
		Served since	served as Co-Portfolio Manager of
		February 2011	the same funds.
		as Co-Portfolio
		Manager	Mr. Peery has been employed by
		for the Funds (or	Hennessy Advisors, Inc., the Funds’
		Predecessor Funds)	investment advisor, since 2002.

Winsor (Skip) Aylesworth(1)	Portfolio Manager	1 year term	Mr. Aylesworth has been Portfolio
Age: 67	and		Manager of the Gas Utility Index Fund
Address:	Vice President	Served since	since 1998 and Portfolio Manager of
c/o Hennessy Advisors, Inc.		October 2012	the Technology Fund since inception.
101 Federal Street		for the Funds (or
Suite 1900		Predecessor Funds)	Mr. Aylesworth previously served as
Boston, MA 02110			Executive Vice President of The FBR
			Funds from 1999 to October 2012.

Ryan Kelley(1)	Portfolio Manager	1 year term	Mr. Kelley has been a Portfolio Manager
Age: 42	and		of the Gas Utility Index Fund (formerly
Address:	Vice President	Served since	the FBR Gas Utility Index Fund), the
c/o Hennessy Advisors, Inc.		March 2013	Small Cap Financial Fund (formerly the
1340 Environ Way		for the Funds (or	FBR Small Cap Financial Fund), and the
Chapel Hill, NC 27517		Predecessor Funds)	Large Cap Financial Fund (formerly the
			FBR Large Cap Financial Fund) since
			October 2014. From March 2013
			through September 2014, he served
			as a Co-Portfolio Manager of the same
			funds. Prior to that, he was a Portfolio
			Analyst of the Hennessy Funds.

			Mr. Kelley previously served as Portfolio
			Manager of The FBR Funds from
			January 2008 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSYFUNDS.COM

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HENNESSY FUNDS 1-800-966-4354

Expense Example (Unaudited)

October 31, 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.

HENNESSYFUNDS.COM

	Beginning	Ending	Expenses Paid
	Account Value	Account Value	During Period(1)
	5/1/14	10/31/14	5/1/14 – 10/31/14
Investor Class

Actual	$1,000.00	$1,026.60	$6.74

Hypothetical (5% return
before expenses)	$1,000.00	$1,018.55	$6.72

(1)	Expenses are equal to the Fund's expense ratio of 1.32%, multiplied by the average account value over the period, multiplied by 184/365 days (to reflect one-half year period).

HENNESSY FUNDS 1-800-966-4354

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, 2014 was 100.00%.

Householding

HENNESSYFUNDS.COM

We collect the following non-public personal information about you:

	•	information we receive from you on or in applications or other forms, correspondence, or conversations, including, but not limited to, your name, address, phone number, social security number, assets, income and date of birth;
		and
	•	information about your transactions with us, our affiliates, or others, including, but not limited to, your account number and balance, payment history, parties to transactions, cost basis information and other financial information.

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.

ANNUAL REPORT

OCTOBER 31, 2014

HENNESSY EQUITY AND

INCOME FUND

Investor Class HEIFX

Institutional Class HEIIX

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		19
Statement of Operations		20
Statements of Changes in Net Assets		21
Financial Highlights		22
Notes to the Financial Statements		26
Report of Independent Registered Public Accounting Firm		34
Trustees and Officers of the Fund		35
Expense Example		40
Proxy Voting		42
Quarterly Filings on Form N-Q		42
Federal Tax Distribution Information		42
Householding		42
Privacy Policy		43

HENNESSY FUNDS 1-800-966-4354

December 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 Index 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)

The opinions expressed in the following commentaries 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 multiple factors, and may not be relied upon as an indication of trading intent on behalf of the Fund. Security positions can and do change.

CHANGE IN VALUE OF $10,000 INVESTMENT

AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED OCTOBER 31, 2014

	One	Five	Ten
	Year	Years	Years
Hennessy Equity and Income Fund –
Investor Class (HEIFX)	10.28%	11.98%	8.04%
Hennessy Equity and Income Fund –
Institutional Class (HEIIX)	10.60%	12.26%	8.31%
Blended Balanced Index	11.13%	11.47%	6.82%
S&P 500 Index	17.27%	16.69%	8.20%

Expense ratios:	Gross 1.39%, Net 1.36%(2) (Investor Class);
	Gross 1.09% (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. Performance for the period from March 12, 2010 to October 26, 2012 is that of the FBR Balanced Fund and for the periods prior to March 12, 2010 is that of the AFBA 5 Star Balanced Fund.

The expense ratios presented are from the most recent prospectus.

(1)	The Blended Balanced Index consists of 60% common stocks represented by the S&P 500 Index and 40% bonds represented by the Barclays Capital Intermediate U.S. Government/Credit Index.
(2)	With regard to Investor Class shares, the Fund’s investment advisor has contractually agreed to waive a portion of its expenses through February 28, 2015.

HENNESSYFUNDS.COM

PERFORMANCE NARRATIVE

THE LONDON COMPANY OF VIRGINIA, LLC,

SUB-ADVISOR (EQUITY PORTION)

FINANCIAL COUNSELORS, INC., SUB-ADVISOR (FIXED INCOME PORTION)

For the twelve-month period ended October 31, 2014, the Investor Class of the Hennessy Equity and Income Fund returned 10.28%, underperforming the Blended Balanced Index* and the S&P 500 Index which returned 11.13% and 17.27% for the same period, respectively, but outperforming the Morningstar Moderate Allocation Category Average, which returned 8.27% for the same period.

Portfolio Managers: Stephen M. Goddard, CFA (Lead Portfolio Manager for the Fund), Jonathan T. Moody, CFA, J. Brian Campbell, CFA, Mark DeVaul, CFA, CPA, The London Company of Virginia, LLC (sub-advisor of the equity portion of the Fund).

Over the previous twelve months, how did the equity portion of the Fund perform and what factors contributed to this performance?

Domestic equity returns for the period were strong. An improving U.S. economy, driven by low interest rates, a strengthening housing market, rising consumer confidence and steady job growth, all helped drive stocks higher. For the twelve month period, the performance of the equity portion of the Fund was on par with the S&P 500 Index. The market was led higher by the Health Care and Information Technology sectors, while the Energy and Telecommunication sectors lagged the market. Stock selection had a positive impact on the Fund’s relative performance, offset by the negative impact of sector allocation. At the sector level, our underweight position in Health Care and overweight position in Consumer Staples had a negative impact on relative performance, partially offset by the positive impact of our underweight position in Energy.

Additional Portfolio Manager commentary on the equity portion of the Fund and the related investment outlook:

While we do not attempt to forecast the future, we remain fairly optimistic. Corporate America is in good shape with high operating margins and strong balance sheets. The economic recovery continues with improvement in employment, capital investment and a generally benign interest rate and inflation outlook. We expect the slow growth environment to continue and believe stocks could be more volatile in the future.

Our strategy is to focus on stocks from a bottom-up standpoint. We seek to own companies with strong returns on capital and flexibility to enhance shareholder value using the balance sheet. Low interest rates and relatively high equity risk premiums enable companies to increase shareholder value by adjusting the capital structure of the company. Separately, with elevated cash levels on corporate balance sheets and dividend payout ratios near historic lows, we expect investors to reward companies that wisely deploy capital through higher dividends, share repurchases and mergers and acquisition transactions. Our more conservative portfolio is well positioned for a slow growth environment that has the potential to reward strong capital allocation.

Portfolio Managers: Gary B. Cloud, CFA and Peter G. Greig, CFA, Financial Counselors, Inc. (sub-advisor of the fixed income portion of the Fund)

Over the previous twelve months, how did the fixed income portion of the Fund perform and what factors contributed to this performance?

A pro-cyclical asset allocation in the Fund hurt performance relative to its primary benchmark, due to an overweight position in corporate bonds and an underweight position in U.S. Treasury securities. Some higher yielding fixed income securities in the portfolio hurt performance, as their yield component was offset by slight principal

HENNESSY FUNDS 1-800-966-4354

declines. The biggest boost to the Fund’s relative performance came from fixed income sector asset allocation and individual issue selection, while the amortization and roll effect had the largest negative impact on Fund performance.

Additional Portfolio Manager commentary on the fixed income portion of the Fund and the related investment outlook:

Every cessation of quantitative easing has resulted in a corrective phase in the risk markets, and that seems to be what may be happening now. One major unresolved element to the mix of uncertainties has to do with the Fed and their collective view of where the Federal Funds rate will be over the next 15 months. Federal Funds futures maturing in December 2016 reflect a 1.50% rate while the Fed governor average forecast is close to 3.0%. The market has pushed back very hard against the Fed members’ own forecast for the optimal Federal Funds rate and they can’t both be right.

We have positioned our bond portfolios to be market weight-duration and overweight credit, with a yield curve flattening bias. We will be on guard to reduce the interest rate sensitivity of the portfolio when we see more progress on the global economic recovery.

The Blended Balanced Index consists of 60% common stocks represented by the S&P 500 Index and 40% bonds represented by the Barclays Capital Intermediate U.S. Government/Credit Index. The S&P 500 Index is an unmanaged index commonly used to measure the performance of U.S. stocks. The Barclays Capital Intermediate U.S. Government/Credit Index is an unmanaged index commonly used to measure the performance of U.S. bonds. 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 debt securities, which typically decrease in value when interest rates rise. The risk is greater for longer term debt securities. Investments by the Fund in lower-rated and non-rated securities presents a greater risk of loss to principal and interest than higher-rated securities. Investments in Asset-Backed and Mortgage-Backed securities include additional risks that investors should be aware of, including credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments. 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. 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

Financial Statements

Schedule of Investments

HENNESSY EQUITY AND INCOME FUND

As of October 31, 2014

(% of Net Assets)

TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS

General Dynamics Corp.	2.90%
United State Treasury Note, 2.750%, 02/15/2024	2.82%
Carmax, Inc.	2.72%
Wells Fargo & Co.	2.63%
Bristol-Myers Sqibb Co.	2.43%
Berkshire Hathaway, Inc., Class B	2.32%
BlackRock, Inc.	2.28%
Eli Lilly & Co.	2.11%
Altria Group, Inc.	1.98%
Lowe’s Companies, Inc.	1.98%

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS – 59.87%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 8.21%
Bed Bath & Beyond, Inc. (a)		102,910	$	6,929,959		1.79	%
CarMax, Inc. (a)		188,039		10,513,261		2.72	%
Carnival Corp. (c)		165,290		6,636,394		1.72	%
Lowe’s Companies, Inc.		133,586		7,641,119		1.98	%
				31,720,733		8.21	%

Consumer Staples – 9.95%
Altria Group, Inc.		158,359		7,655,074		1.98	%
Brown-Forman Corp., Class B		29,936		2,774,169		0.72	%
Energizer Holdings, Inc.		62,292		7,640,114		1.97	%
Lorillard, Inc.		69,236		4,258,014		1.10	%
Reynolds American, Inc.		90,841		5,714,808		1.48	%
The Coca-Cola Co.		126,431		5,294,930		1.37	%
Wal-Mart Stores, Inc.		67,452		5,144,564		1.33	%
				38,481,673		9.95	%

Energy – 4.63%
Apache Corp.		59,880		4,622,736		1.19	%
Chevron Corp.		59,491		7,135,945		1.85	%
ConocoPhillips		85,378		6,160,023		1.59	%
				17,918,704		4.63	%

Financials – 9.99%
Alleghany Corp. (a)		8,720		3,874,122		1.00	%
Bank of America Corp.		397,380		6,819,041		1.76	%
Berkshire Hathaway, Inc., Class B (a)		63,909		8,957,485		2.32	%
BlackRock, Inc.		25,828		8,810,189		2.28	%
Wells Fargo & Co.		191,223		10,152,029		2.63	%
				38,612,866		9.99	%

Health Care – 5.61%
Bristol-Myers Squibb Co.		161,788		9,414,444		2.43	%
Eli Lilly & Co.		122,760		8,142,671		2.11	%
Pfizer, Inc.		137,555		4,119,772		1.07	%
				21,676,887		5.61	%

Industrials – 4.42%
FedEx Corp.		35,078		5,872,057		1.52	%
General Dynamics Corp.		80,330		11,226,921		2.90	%
				17,098,978		4.42	%

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

HENNESSYFUNDS.COM

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Information Technology – 10.63%
Cisco Systems, Inc.		216,456	$	5,296,678		1.37	%
Corning, Inc.		357,377		7,301,212		1.89	%
EMC Corp.		233,733		6,715,149		1.74	%
Intel Corp.		212,199		7,216,888		1.87	%
International Business Machines Corp.		18,865		3,101,406		0.80	%
Microsoft Corp.		92,183		4,327,992		1.12	%
Visa, Inc., Class A		29,529		7,129,187		1.84	%
				41,088,512		10.63	%

Materials – 5.00%
Albemarle Corp.		113,325		6,615,913		1.71	%
NewMarket Corp.		17,300		6,712,573		1.74	%
The Mosaic Co.		135,100		5,986,281		1.55	%
				19,314,767		5.00	%

Telecommunication Services – 1.43%
Verizon Communications, Inc.		110,108		5,532,927		1.43	%
				5,532,927		1.43	%

Total Common Stocks
(Cost $173,667,014)				231,446,047		59.87	%

PREFERRED STOCKS – 0.01%
Financials – 0.01%
Fannie Mae Preferred (a)		10,600		45,050		0.01	%

Total Preferred Stocks
(Cost $265,000)				45,050		0.01	%

REITS – 0.08%
Financials – 0.08%
Apollo Commercial Real Estate Finance, Inc.		19,000		312,360		0.08	%

Total REITS
(Cost $318,390)				312,360		0.08	%

CORPORATE BONDS – 21.62%
Consumer Discretionary – 0.65%
Amazon.com, Inc.
0.650%, 11/27/2015		800,000		801,012		0.21	%

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

HENNESSY FUNDS 1-800-966-4354

CORPORATE BONDS	Par				% of
	Amount		Value		Net Assets
Consumer Discretionary (Continued)
Comcast Corp.
4.950%, 06/15/2016		600,000	$	640,073		0.16	%
Starbucks Corp.
6.250%, 08/15/2017		300,000		339,247		0.09	%
The Home Depot, Inc.
5.400%, 03/01/2016		700,000		744,657		0.19	%
				2,524,989		0.65	%

Consumer Staples – 0.31%
Anheuser-Busch InBev Worldwide, Inc.
7.750%, 01/15/2019		150,000		182,076		0.05	%
CVS Health Corp.
5.750%, 06/01/2017		600,000		666,377		0.17	%
Wal-Mart Stores, Inc.
5.000%, 10/25/2040		300,000		346,829		0.09	%
				1,195,282		0.31	%

Energy – 0.23%
Encana Corp. (c)
3.900%, 11/15/2021		850,000		888,542		0.23	%
				979,669		0.25	%

Financials – 12.68%
Aflac, Inc.
8.500%, 05/15/2019		650,000		821,908		0.21	%
American Express Centrurion
0.875%, 11/13/2015		700,000		702,457		0.18	%
American Express Co.
6.150%, 08/28/2017		1,550,000		1,747,679		0.45	%
American Express Credit Corp.
2.750%, 09/15/2015		1,150,000		1,172,801		0.30	%
American International Group, Inc.
4.875%, 06/01/2022		600,000		670,305		0.17	%
5.850%, 01/16/2018		1,075,000		1,212,381		0.32	%
Associated Banc-Corp
5.125%, 03/28/2016		700,000		737,499		0.19	%
Associates Corporation of North America
6.950%, 11/01/2018		300,000		352,457		0.09	%
Bank New York Mellon Corp.
1.969%, 06/20/2017		500,000		510,185		0.13	%
Bank of Montreal (c)
2.500%, 01/11/2017		400,000		412,322		0.11	%

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

HENNESSYFUNDS.COM

CORPORATE BONDS	Par				% of
	Amount		Value		Net Assets
Financials (Continued)
Bank of Nova Scotia (c)
2.550%, 01/12/2017		1,000,000	$	1,031,262		0.27	%
BlackRock, Inc.
3.500%, 03/18/2024		1,000,000		1,018,412		0.26	%
Boston Properties, Inc.
5.875%, 10/15/2019		700,000		808,397		0.21	%
Capital One Financial Corp.
4.750%, 07/15/2021		1,500,000		1,653,778		0.43	%
Citigroup, Inc.
6.125%, 11/21/2017		1,455,000		1,636,985		0.42	%
Credit Suisse USA, Inc.
5.125%, 08/15/2015		975,000		1,009,718		0.26	%
Discover Financial Services
5.200%, 04/27/2022		900,000		990,261		0.26	%
Fifth Third Bancorp
3.625%, 01/25/2016		700,000		723,734		0.19	%
First Niagara Financial Group, Inc.
6.750%, 03/19/2020		590,000		678,816		0.18	%
Ford Motor Credit Co. LLC
3.000%, 06/12/2017		1,750,000		1,805,473		0.47	%
Franklin Resources, Inc.
1.375%, 09/15/2017		1,080,000		1,081,610		0.28	%
General Electric Capital Corp.
1.625%, 04/02/2018		500,000		500,682		0.13	%
5.000%, 01/08/2016		500,000		525,169		0.13	%
5.625%, 05/01/2018		1,050,000		1,188,130		0.31	%
Genworth Financial, Inc.
6.515%, 05/22/2018		500,000		563,496		0.15	%
Goldman Sachs Group, Inc.
5.375%, 03/15/2020		1,100,000		1,234,318		0.32	%
HSBC Finance Corp.
5.000%, 06/30/2015		1,200,000		1,232,297		0.32	%
J.P. Morgan Chase & Co.
6.000%, 01/15/2018		1,000,000		1,127,669		0.29	%
KeyCorp
3.750%, 08/13/2015		900,000		921,483		0.24	%
5.100%, 03/24/2021		950,000		1,068,071		0.27	%
Lazard Group
6.850%, 06/15/2017		320,000		360,694		0.09	%
Lincoln National Corp.
6.250%, 02/15/2020		780,000		917,056		0.24	%

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

HENNESSY FUNDS 1-800-966-4354

CORPORATE BONDS	Par				% of
	Amount		Value		Net Assets
Financials (Continued)
Manulife Financial Corp. (c)
3.400%, 09/17/2015		300,000	$	307,407		0.08	%
Merrill Lynch & Company, Inc.
6.875%, 04/25/2018		955,000		1,105,585		0.29	%
Merrill Lynch & Company, Inc., Series MTNC
0.6906%, 01/15/2015		250,000		250,111		0.06	%
MetLife, Inc., Series A
6.817%, 08/15/2018		100,000		117,345		0.03	%
Morgan Stanley
5.375%, 10/15/2015		500,000		522,059		0.14	%
5.500%, 07/28,2021		858,000		979,669		0.25	%
6.625%, 04/01/2018		250,000		286,511		0.07	%
National Australia Bank Ltd. (c)
1.367%, 08/07/2015		2,000,000		2,016,526		0.52	%
Prudential Financial, Inc.
5.500%, 03/15/2016		310,000		329,381		0.09	%
Qwest Capital Funding, Inc.
6.500%, 11/15/2018		700,000		778,750		0.20	%
Raymond James Financial, Inc.
5.625%, 04/01/2024		700,000		796,949		0.21	%
Royal Bank of Canada (c)
2.200%, 07/27/2018		1,000,000		1,016,029		0.26	%
St. Paul Travelers, Inc.
5.500%, 12/01/2015		275,000		289,470		0.07	%
SunTrust Banks, Inc.
3.600%, 04/15/2016		250,000		259,921		0.07	%
6.000%, 09/11/2017		250,000		281,059		0.07	%
Synchrony Financial
3.750%, 08/15/2021		1,200,000		1,224,510		0.32	%
The Bear Stearns Companies, Inc.
6.400%, 10/02/2017		1,350,000		1,527,695		0.40	%
The Charles Schwab Corp.
0.850%, 12/04/2015		1,000,000		1,003,440		0.26	%
The Goldman Sachs Group, Inc.
5.350%, 01/15/2016		500,000		527,322		0.14	%
The Hartford Financial Services Group, Inc.
5.375%, 03/15/2017		300,000		327,615		0.08	%
The Royal Bank of Scotland PLC (c)
4.375%, 03/16/2016		400,000		417,684		0.11	%

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

HENNESSYFUNDS.COM

CORPORATE BONDS	Par				% of
	Amount		Value		Net Assets
Financials (Continued)
Toronto Dominion Bank (c)
2.375%, 10/19/2016		1,000,000	$	1,031,735		0.27	%
Wachovia Corp.
5.750%, 06/15/2017		850,000		945,660		0.24	%
Wells Fargo & Co.
5.625%, 12/11/2017		1,000,000		1,122,584		0.29	%
Westpac Banking Corp. (c)
0.838%, 01/17/2019		1,075,000		1,081,463		0.28	%
4.200%, 02/27/2015		500,000		505,953		0.13	%
4.875%, 11/19/2019		450,000		506,574		0.13	%
				49,976,512		12.93	%

Health Care – 2.08%
AbbVie, Inc.
1.200%, 11/06/2015		1,250,000		1,257,375		0.33	%
Agilent Technologies, Inc.
5.000%, 07/15/2020		650,000		711,967		0.18	%
Amgen, Inc.
2.500%, 11/15/2016		1,000,000		1,028,195		0.27	%
Celgene Corp.
2.300%, 08/15/2018		1,000,000		1,007,445		0.26	%
3.625%, 05/15/2024		600,000		607,578		0.16	%
Express Scripts Holding Co.
3.500%, 06/15/2024		700,000		695,181		0.18	%
GlaxoSmithKline Capital, Inc. (c)
1.500%, 05/08/2017		500,000		504,644		0.13	%
Merck and Co., Inc.
6.000%, 09/15/2017		850,000		963,411		0.25	%
UnitedHealth Group, Inc.
5.375%, 03/15/2016		250,000		266,282		0.07	%
Wellpoint, Inc.
2.375%, 02/15/2017		960,000		984,422		0.25	%
				8,026,500		2.08	%

Industrials – 0.26%
John Deere Capital Corp.
1.850%, 09/15/2016		1,000,000		1,019,910		0.26	%
				1,019,910		0.26	%

Information Technology – 1.69%
Altera Corp.
1.750%, 05/15/2017		1,000,000		1,006,340		0.26	%
Applied Materials, Inc.
4.300%, 06/15/2021		300,000		327,076		0.08	%

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

HENNESSY FUNDS 1-800-966-4354

CORPORATE BONDS	Par				% of
	Amount		Value		Net Assets
Information Technology (Continued)
Corning, Inc.
6.850%, 03/01/2029		275,000	$	349,902		0.09	%
eBay, Inc.
3.250%, 10/15/2020		1,000,000		1,010,470		0.26	%
EMC Corp.
1.875%, 06/01/2018		1,000,000		994,898		0.26	%
Hewlett Packard Co.
3.000%, 09/15/2016		1,000,000		1,033,205		0.27	%
Juniper Networks, Inc.
4.600%, 03/15/2021		1,000,000		1,063,677		0.28	%
KLA-Tencor Corp.
6.900%, 05/01/2018		650,000		753,157		0.19	%
				6,538,725		1.69	%

Materials – 1.63%
Alcoa, Inc.
6.150%, 08/15/2020		625,000		705,393		0.18	%
AngloGold Ashanti Holdings PLC (c)
5.125%, 08/01/2022		1,000,000		949,038		0.25	%
El du Pont de Nemours & Co.
4.750%, 03/15/2015		315,000		320,001		0.08	%
Goldcorp, Inc. (c)
2.125%, 03/15/2018		1,250,000		1,250,446		0.33	%
International Paper Co.
9.375%, 05/15/2019		250,000		322,107		0.08	%
Rio Tinto Finance USA PLC (c)
1.375%, 06/17/2016		1,000,000		1,007,922		0.26	%
2.000%, 03/22/2017		640,000		649,356		0.17	%
The Dow Chemical Co.
4.250%, 11/15/2020		1,000,000		1,078,259		0.28	%
				6,282,522		1.63	%

Telecommunication Services – 1.76%
AT&T, Inc.
2.950%, 05/15/2016		775,000		799,647		0.21	%
3.000%, 02/15/2022		250,000		247,572		0.06	%
5.350%, 09/01/2040		200,000		214,301		0.05	%
5.800%, 02/15/2019		800,000		917,162		0.24	%
CenturyLink, Inc.
5.150%, 06/15/2017		400,000		426,000		0.11	%
Deutsche Telekom AG (c)
6.000%, 07/08/2019		1,160,000		1,352,886		0.35	%

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

HENNESSYFUNDS.COM

CORPORATE BONDS	Par				% of
	Amount		Value		Net Assets
Telecommunication Services (Continued)
Verizon Communications, Inc.
0.700%, 11/02/2015		800,000	$	800,788		0.21	%
6.350%, 04/01/2019		600,000		700,458		0.18	%
8.750%, 11/01/2018		292,000		364,738		0.09	%
Vodafone Group PLC (c)
1.500%, 02/19/2018		1,000,000		987,052		0.26	%
				6,810,604		1.76	%

Utilities – 0.08%
Sempra Energy
6.500%, 06/01/2016		275,000		299,120		0.08	%

Total Corporate Bonds
(Cost $81,591,857)				83,562,706		21.62	%

MORTGAGE BACKED SECURITIES – 3.57%

Federal Home Loan Mortgage Corp.
3.000%, 05/01/2042		1,402,945		1,408,265		0.36	%
3.000%, 09/01/2042		2,686,534		2,696,168		0.70	%
5.000%, 05/01/2020		109,240		117,319		0.03	%
5.500%, 04/01/2037		205,772		231,776		0.06	%

Federal National Mortgage Association
1.000%, 08/27/2024		1,400,000		1,400,131		0.36	%
2.000%, 02/27/2032		980,000		978,391		0.25	%
2.400%, 11/07/2024		1,000,000		950,432		0.25	%
3.000%, 03/20/2028		2,200,000		2,207,786		0.57	%
3.500%, 01/01/2042		892,190		925,110		0.24	%
4.000%, 12/01/2041		1,145,686		1,218,160		0.32	%
4.000%, 10/01/2041		1,285,154		1,366,450		0.35	%
4.500%, 08/01/2020		120,902		128,185		0.03	%
6.000%, 10/01/2037		165,151		187,203		0.05	%

Total Mortgage Backed Securities
(Cost $13,807,502)				13,815,376		3.57	%

U.S. TREASURY OBLIGATIONS – 8.61%
U.S. Treasury Bonds – 0.65%
U.S. Treasury Bonds
3.625%, 02/15/2044		2,250,000		2,497,325		0.64	%
U.S. Treasury Inflation Index Bond
0.125%, 07/15/2022		25,858		25,528		0.01	%
				2,522,853		0.65	%

U.S. Treasury Notes – 7.96%
U.S. Treasury Notes
1.625%, 06/30/2019		4,500,000		4,514,765		1.17	%

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

HENNESSY FUNDS 1-800-966-4354

U.S. TREASURY OBLIGATIONS	Par				% of
	Amount		Value		Net Assets
U.S. Treasury Notes (Continued)
2.250%, 07/31/2021		1,750,000	$	1,775,704		0.46	%
2.375%, 03/31/2016		6,005,000		6,179,992		1.60	%
2.500%, 08/15/2023		1,100,000		1,122,687		0.29	%
2.750%, 02/15/2024		10,500,000		10,906,056		2.82	%
3.250%, 03/31/2017		3,000,000		3,182,109		0.83	%
4.125%, 05/15/2015		3,000,000		3,063,984		0.79	%
				30,745,297		7.96	%

Total U.S. Treasury Obligations
(Cost $32,911,170)				33,268,150		8.61	%

U.S. GOVERNMENT AGENCY ISSUE – 1.16%
Finance and Insurance – 1.16%
Federal Home Loan Banks
1.000%, 07/23/2029		2,000,000		1,959,282		0.51	%
1.500%, 09/30/2024		650,000		651,243		0.17	%
3.000%, 07/17/2029		1,200,000		1,203,600		0.31	%
5.750%, 06/15/2037		600,000		667,867		0.17	%
				4,481,992		1.16	%

Total U.S. Government Agency Issue
(Cost $4,536,174)				4,481,992		1.16	%

INVESTMENT COMPANIES (Excluding
Money Market Funds) – 2.95%
Apollo Investment Corp.		40,000		330,000		0.08	%
Ares Capital Corp.		17,500		279,825		0.07	%
Calamos Convertible Opportunities and Income Fund		16,000		219,040		0.06	%
iShares iBoxx $High Yield Corporation Bond Fund		20,000		1,850,600		0.48	%
iShares S&P U.S. Preferred Stock Index Fund		82,500		3,279,375		0.85	%
Oha Investment Corp.		8,000		51,920		0.01	%
PennantPark Investment Corp.		19,000		206,720		0.06	%
PowerShares Senior Loan Portfolio		25,000		609,500		0.16	%
SPDR Barclays Capital High Yield Bond		27,000		1,089,720		0.28	%
SPDR Barclays Short Term High Yield		99,500		2,980,025		0.77	%
Wisdomtree Emerging Markets Local Debt Fund		11,000		491,810		0.13	%
				11,388,535		2.95	%

Total Investment Companies (Excluding
Money Market Funds) (Cost $11,516,543)				11,388,535		2.95	%

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

HENNESSYFUNDS.COM

SHORT-TERM INVESTMENTS – 1.72%	Number				% of
	of Shares		Value		Net Assets
Money Market Funds – 1.72%
Fidelity Government Portfolio – Institutional Class, 0.01% (b)		6,648,848	$	6,648,848		1.72	%

Total Short-Term Investments
(Cost $6,648,848)				6,648,848		1.72	%

Total Investments
(Cost $325,262,498) – 99.59%				384,969,064		99.59	%
Other Assets in Excess
of Liabilities – 0.41%				1,584,525		0.41	%
TOTAL NET ASSETS – 100.00%			$	386,553,589		100.00	%

Percentages are stated as a percent of net assets.

REIT – Real Estate Investment Trust

	(a)	Non-income producing security.
	(b)	The rate listed is the fund’s 7-day yield as of October 31, 2014.
	(c)	U.S. traded security of a foreign corporation.

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

HENNESSY FUNDS 1-800-966-4354

Summary of Fair Value Exposure at October 31, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of October 31, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stocks	Level 1		Level 2		Level 3		Total
Consumer Discretionary	$	31,720,733	$	—	$	—	$	31,720,733
Consumer Staples		38,481,673		—		—		38,481,673
Energy		17,918,704		—		—		17,918,704
Financials		38,612,866		—		—		38,612,866
Health Care		21,676,887		—		—		21,676,887
Industrials		17,098,978		—		—		17,098,978
Information Technology		41,088,512		—		—		41,088,512
Materials		19,314,767		—		—		19,314,767
Telecommunication Services		5,532,927		—		—		5,532,927
Total Common Stocks	$	231,446,047	$	—	$	—	$	231,446,047
Preferred Stocks
Financials	$	45,050	$	—	$	—	$	45,050
Total Preferred Stocks	$	45,050	$	—	$	—	$	45,050
REITS
Financials	$	312,360	$	—	$	—	$	312,360
Total REITS	$	312,360	$	—	$	—	$	312,360
Corporate Bonds
Consumer Discretionary	$	—	$	2,524,989	$	—	$	2,524,989
Consumer Staples		—		1,195,282		—		1,195,282
Energy		—		888,542		—		888,542
Finances and Insurance		—		979,669		—		979,669
Financials		—		48,996,843		—		48,996,843
Health Care		—		8,026,500		—		8,026,500
Industrials		—		1,019,910		—		1,019,910
Information Technology		—		6,538,725		—		6,538,725
Materials		—		6,282,522		—		6,282,522
Telecommunication Services		—		6,810,604		—		6,810,604
Utilities		—		299,120		—		299,120
Total Corporate Bonds	$	—	$	83,562,706	$	—	$	83,562,706
Mortgage Backed Securities	$	—	$	13,815,376	$	—	$	13,815,376
U.S. Treasury Obligations
U.S. Treasury Bonds	$	—	$	2,522,853	$	—	$	2,522,853
U.S. Treasury Notes		—		30,745,297		—		30,745,297
Total U.S. Treasury Obligations	$	—	$	33,268,150	$	—	$	33,268,150
U.S. Government Agency Issues	$	—	$	4,481,992	$	—	$	4,481,992
Investment Companies (Excluding
Money Market Funds)	$	11,388,535	$	—	$	—	$	11,388,535
Short-Term Investments
Money Market Funds	$	6,648,848	$	—	$	—	$	6,648,848
Total Short-Term Investments	$	6,648,848	$	—	$	—	$	6,648,848
Total Investments	$	249,840,840	$	135,128,224	$	—	$	384,969,064

Transfers between levels are recognized at the end of the reporting period. During the one-year period ended October 31, 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 October 31, 2014

ASSETS:
Investments in securities, at value (cost $325,262,498)	$	384,969,064
Cash		1,980
Dividends and interest receivable		1,380,961
Receivable for fund shares sold		1,137,474
Receivable for securities sold		989,470
Prepaid expenses and other assets		26,472
Total Assets		388,505,421

LIABILITIES:
Payable for securities purchased		992,658
Payable for fund shares redeemed		469,470
Payable to advisor		267,881
Payable to administrator		63,878
Payable to auditor		19,106
Accrued distribution fees		63,615
Accrued trustees fees		2,272
Accrued expenses and other payables		72,952
Total Liabilities		1,951,832
NET ASSETS	$	386,553,589

NET ASSETS CONSIST OF:
Capital stock	$	311,212,890
Accumulated net investment income		225,718
Accumulated net realized gain on investments		15,408,415
Unrealized net appreciation on investments		59,706,566
Total Net Assets	$	386,553,589

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares	$	284,452,031
Shares issued and outstanding		17,050,284
Net asset value, offering price and redemption price per share	$	16.68

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares	$	102,101,558
Shares issued and outstanding		6,461,924
Net asset value, offering price and redemption price per share	$	15.80

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Statement of Operations for the year ended October 31, 2014

INVESTMENT INCOME:
Dividend income	$	5,175,538
Interest income		2,768,249
Total investment income		7,943,787

EXPENSES:
Investment advisory fees (See Note 5)		2,717,393
Distribution fees – Investor Class (See Note 5)		624,882
Administration, fund accounting, custody and transfer agent fees		383,950
Sub-transfer agent expenses – Investor Class (See Note 5)		288,976
Sub-transfer agent expenses – Institutional Class (See Note 5)		78,985
Federal and state registration fees		46,114
Reports to shareholders		38,202
Compliance expense		21,488
Audit fees		19,100
Trustees’ fees and expenses		11,622
Legal fees		5,253
Other expenses		25,532
Total expenses before recoupment by advisor		4,261,497
Expense recoupment by advisor – Investor Class (See Note 5)		5,453
Total expenses		4,266,950
NET INVESTMENT INCOME	$	3,676,837

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	15,504,616
Net change in unrealized appreciation on investments		14,585,293
Net gain on investments		30,089,909
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	33,766,746

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

HENNESSYFUNDS.COM

Financial Statements

Statements of Changes in Net Assets

	Year Ended			Year Ended
	October 31, 2014			October 31, 2013
OPERATIONS:
Net investment income	$	3,676,837		$	4,864,880
Net realized gain on investments		15,504,616			13,272,491
Net change in unrealized appreciation on investments		14,585,293			21,344,922
Net increase in net assets resulting from operations		33,766,746			39,482,293

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income – Investor Class		(2,501,276	)		(3,063,016	)
Net investment income – Institutional Class		(1,216,647	)		(1,937,482	)
Net realized gains – Investor Class		(7,388,837	)		—
Net realized gains – Institutional Class		(2,912,412	)		—
Total distributions		(14,019,172	)		(5,000,498	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		89,438,072			99,856,871
Proceeds from shares subscribed – Institutional Class		33,413,966			29,868,131
Dividends reinvested – Investor Class		9,653,413			2,933,613
Dividends reinvested – Institutional Class		2,948,861			1,518,097
Cost of shares redeemed – Investor Class		(62,677,527	)(1)		(90,377,638	)(2)
Cost of shares redeemed – Institutional Class		(24,337,024	)		(65,319,830	)(2)
Net increase (decrease) in net assets derived
from capital share transactions		48,439,761			(21,520,756	)
TOTAL INCREASE IN NET ASSETS		68,187,335			12,961,039

NET ASSETS:
Beginning of year		318,366,254			305,405,215
End of year	$	386,553,589		$	318,366,254
Undistributed net investment income, end of year	$	225,718		$	247,147

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		5,597,992			6,666,051
Shares sold – Institutional Class		2,204,175			2,087,219
Shares issued to holders as reinvestment
of dividends – Investor Class		620,329			200,342
Shares issued to holders as reinvestment
of dividends – Institutional Class		199,624			110,506
Shares redeemed – Investor Class		(3,961,896	)		(6,175,811	)
Shares redeemed – Institutional Class		(1,628,945	)		(4,674,153	)
Net increase (decrease) in shares outstanding		3,031,279			(1,785,846	)

(1)	Net of redemption fees of $105 related to redemption fees imposed by the FBR Balanced Fund during a prior year but not received until the fiscal year ended October 31, 2014.
(2)	Net of redemption fees of $1,077 and $482 for the Investor Class and Institutional Class shares, respectively, related to redemption fees imposed by the FBR Balanced 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 Statements

Financial Highlights

For an Investor Class share outstanding throughout each period

PER SHARE DATA:

Net asset value, beginning of year

Income from investment operations:

Net investment income

Net realized and unrealized gains on investments

Total from investment operations

Less distributions:

Dividends from net investment income

Dividends from net realized gains

Total distributions

Paid-in capital from redemption fees

Net asset value, end of year

TOTAL RETURN

SUPPLEMENTAL DATA AND RATIOS:

Net assets, end of year (millions)

Ratio of expenses to average net assets:

Before expense reimbursement/recoupment

After expense reimbursement/recoupment

Ratio of net investment income to average net assets:

Before expense reimbursement/recoupment

After expense reimbursement/recoupment

Portfolio turnover rate(6)

(1)	For the seven-month period ended October 31, 2010. Effective October 31, 2010, the Fund changed its fiscal year end from March 31 to October 31.
(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

												For the Period
												April 1, 2010			Year Ended
For the Year Ended October 31,												to October 31,			March 31,
2014			2013			2012			2011			2010(1)			2010

$	15.77		$	13.96		$	12.99		$	11.93		$	11.52		$	8.92


	0.16			0.23			0.18			0.29	(2)		0.17	(2)		0.29	(2)
	1.41			1.81			0.99			1.04			0.40			2.61
	1.57			2.04			1.17			1.33			0.57			2.90


	(0.16	)		(0.23	)		(0.20	)		(0.27	)		(0.16	)		(0.30	)
	(0.50	)		—			—			—			—			—
	(0.66	)		(0.23	)		(0.20	)		(0.27	)		(0.16	)		(0.30	)
	0.00	(3)		0.00	(3)		0.00	(3)		0.00	(3)		0.00	(3)		0.00	(3)
$	16.68		$	15.77		$	13.96		$	12.99		$	11.93		$	11.52

	10.28	%		14.72	%		9.01	%		11.30	%		5.04	%(4)		32.76	%


$	284.45		$	233.25		$	196.92		$	56.75		$	41.50		$	46.81

	1.33	%		1.36	%		1.33	%		1.54	%		1.60	%(5)		1.69	%
	1.33	%		1.33	%		1.24	%		1.24	%		1.24	%(5)		1.25	%

	1.01	%		1.51	%		1.37	%		2.03	%		2.21	%(5)		2.26	%
	1.01	%		1.54	%		1.46	%		2.33	%		2.56	%(5)		2.70	%
	28	%		52	%		34	%		35	%		27	%(4)		26	%

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Financial Highlights

For an Institutional Class share outstanding throughout each period

PER SHARE DATA:

Net asset value, beginning of year

Income from investment operations:

Net investment income

Net realized and unrealized gains on investments

Total from investment operations

Less distributions:

Dividends from net investment income

Dividends from net realized gains

Total distributions

Paid-in capital from redemption fees

Net asset value, end of year

TOTAL RETURN

SUPPLEMENTAL DATA AND RATIOS:

Net assets, end of year (millions)

Ratio of expenses to average net assets:

Before expense reimbursement

After expense reimbursement

Ratio of net investment income to average net assets:

Before expense reimbursement

After expense reimbursement

Portfolio turnover rate(6)

(1)	For the seven-month period ended October 31, 2010. Effective October 31, 2010, the Fund changed its fiscal year end from March 31 to October 31.
(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

												For the Period
												April 1, 2010			Year Ended
For the Year Ended October 31,												to October 31,			March 31,
2014			2013			2012			2011			2010(1)			2010

$	14.97		$	13.29		$	12.38		$	11.38		$	10.99		$	8.52


	0.20			0.25			0.22			0.32	(2)		0.18	(2)		0.30	(2)
	1.33			1.72			0.92			0.99			0.38			2.50
	1.53			1.97			1.14			1.31			0.56			2.80


	(0.20	)		(0.29	)		(0.23	)		(0.31	)		(0.17	)		(0.33	)
	(0.50	)		—			—			—			—			—
	(0.70	)		(0.29	)		(0.23	)		(0.31	)		(0.17	)		(0.33	)
	—			0.00	(3)		0.00	(3)		0.00	(3)		0.00	(3)		0.00	(3)
$	15.80		$	14.97		$	13.29		$	12.38		$	11.38		$	10.99

	10.60	%		14.99	%		9.23	%		11.62	%		5.19	%(4)		33.10	%


$	102.10		$	85.12		$	108.49		$	55.28		$	42.17		$	39.40

	1.05	%		1.06	%		1.06	%		1.12	%		1.20	%(5)		1.43	%
	1.05	%		1.06	%		0.99	%		0.99	%		0.99	%(5)		0.99	%

	1.29	%		1.95	%		1.68	%		2.56	%		2.60	%(5)		2.57	%
	1.29	%		1.95	%		1.75	%		2.69	%		2.82	%(5)		3.01	%
	28	%		52	%		34	%		35	%		27	%(4)		26	%

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Notes to Financial Statements October 31, 2014

1). ORGANIZATION

The Hennessy Equity and Income 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 Balanced 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 long-term capital growth and current income. The Fund is a 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 an individual class.

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.

	Due to inherent differences in the recognition of income, expenses, and realized gains/losses under GAAP and federal income tax regulations, permanent differences between book and tax basis reporting for the 2014 fiscal year have been identified

HENNESSYFUNDS.COM

and appropriately reclassified on the Statement of Assets and Liabilities. The adjustments are as follow:

Undistributed	Accumulated
Net Investment	Net Realized
Income/(Loss)	Gain/(Loss)	Paid-in Capital
$19,657	$(19,657)	$—

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 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 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 NAV 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

HENNESSY FUNDS 1-800-966-4354

	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 fiscal year ended October 31, 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 to cover the repurchase amount 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 tax returns of the Fund for the prior three fiscal years are open for examination. 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.

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 fiscal year ended October 31, 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 October 31, 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.

HENNESSYFUNDS.COM

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.

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

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.

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 for a security that reflects the amount the Fund might reasonably expect to receive in a current sale. 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 NAVs 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 fiscal year ended October 31, 2014 were $90,494,585 and $71,098,054, respectively.

HENNESSYFUNDS.COM

Purchases and sales/maturities of long-term U.S. Government Securities for the Fund were $35,188,832 and $21,286,609, respectively, during the fiscal year ended October 31, 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 0.80%. The net investment advisory fees payable for the Fund as of October 31, 2014 were $267,881.

The Advisor has delegated the day-to-day management of the equity sleeve of the Fund to The London Company of Virginia, LLC and has delegated the day-to-day management of the fixed income sleeve of the Fund to Financial Counselors, 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.

The Advisor has contractually agreed to limit the total annual operating expenses of the Fund (excluding interest, taxes, brokerage commissions, dividend expenses, 12b-1 fees, acquired fund fees and expenses, extraordinary legal expenses, or any other extraordinary expenses) to 1.08% of the Fund’s net assets for both the Investor Class shares and Institutional Class shares of the Fund through February 28, 2015.

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 current year, expenses of $5,453 were recouped, and the remaining $62,366 is subject to possible recovery through October 31, 2016. As of October 31, 2014, cumulative expenses subject to potential recovery to the aforementioned conditions are $62,366 for the Investor Class, which will expire on October 31, 2016.

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 average daily net assets of the Fund 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.

U.S. Bancorp Fund Services, LLC (“USBFS”) provides the Fund with administrative, fund accounting, and transfer agent services, including all regulatory reporting, and

HENNESSY FUNDS 1-800-966-4354

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 fiscal year ended October 31, 2014 were $383,950.

6). LINE OF CREDIT

7). FEDERAL TAX INFORMATION

As of October 31, 2014, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follow:

Cost of investments for tax purposes	$	325,354,199
Gross tax unrealized appreciation	$	62,317,355
Gross tax unrealized depreciation		(2,702,490	)
Net tax unrealized appreciation	$	59,614,865
Undistributed ordinary income	$	340,092
Undistributed long-term capital gains		15,385,741
Total distributable earnings	$	15,725,833
Other accumulated gain	$	—
Total accumulated gain	$	75,340,698

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to wash sales.

At October 31, 2014, the Fund had no tax basis capital losses to offset future capital gains.

At October 31, 2014, the Fund did not defer, on a tax basis, any late year ordinary losses.

The tax character of distributions paid during fiscal year 2014 and fiscal year 2013 for the Fund were as follow:

	Year Ended		Year Ended
	October 31, 2014		October 31, 2013
Ordinary income	$	3,317,923	$	5,000,498
Long-term capital gain		10,301,249		—
	$	14,019,172	$	5,000,498

HENNESSYFUNDS.COM

8). EVENTS SUBSEQUENT TO YEAR-END

On December 8, 2014, the following capital gains distributions were declared and paid to shareholders of record on December 5, 2014:

	Short-term Capital Gains	Rate/Share ($)
	Investor Class	$0.00476
	Institutional Class	$0.00451

	Long-term Capital Gains	Rate/Share ($)
	Investor Class	$0.63992
	Institutional Class	$0.60674

HENNESSY FUNDS 1-800-966-4354

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of Hennessy Funds Trust

And the Shareholders of Hennessy Equity and Income Fund

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of the Hennessy Equity and Income Fund (the “Fund”), a series of Hennessy Funds Trust as of October 31, 2014, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and the financial highlights for each of the four years in the period then ended and the seven month period ended October 31, 2010 and the year ended March 31, 2010. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2014, by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Hennessy Equity and Income Fund as of October 31, 2014, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the four years in the period then ended and the seven month period ended October 31, 2010 and the year ended March 31, 2010, in conformity with accounting principles generally accepted in the United States of America.

TAIT, WELLER & BAKER LLP

Philadelphia, Pennsylvania

December 30, 2014

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Trustees and Officers of the Fund (Unaudited)

				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

Disinterested Trustees (as defined below)

J. Dennis DeSousa	Trustee	Indefinite,	Mr. DeSousa is a real	16	Hennessy SPARX
Age: 78		until	estate investor.		Funds Trust;
Address:		successor			Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Robert T. Doyle	Trustee	Indefinite,	Mr. Doyle has been the	16	Hennessy SPARX
Age: 67		until	Sheriff of Marin County,		Funds Trust;
Address:		successor	California since 1996.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Gerald P. Richardson	Trustee	Indefinite,	Mr. Richardson is an	16	Hennessy SPARX
Age: 69		until	independent consultant		Funds Trust;
Address:		successor	in the securities industry.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		May 2004
		for the
		Funds (or
		Predecessor
		Funds)

HENNESSY FUNDS 1-800-966-4354

				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

“Interested Persons” (as defined in the 1940 Act)

Neil J. Hennessy(1)	Chief	Trustee:	Mr. Hennessy has been	16	Hennessy
Age: 58	Investment	Indefinite,	employed by Hennessy		Advisors, Inc.
Address:	Officer,	until	Advisors, Inc., the Funds’		(current);
c/o Hennessy	Portfolio	successor	investment advisor, since		Hennessy SPARX
Advisors, Inc.	Manager,	elected	1989. He currently serves		Funds Trust;
7250 Redwood Blvd.	President,		as President, Chairman		Hennessy Mutual
Suite 200	Trustee	Served	and CEO of Hennessy		Funds, Inc.; and
Novato, CA 94945	and	since	Advisors, Inc.		The Hennessy
	Chairman	January			Funds, Inc.
	of the	1996
	Board	for the
		Funds (or
		Predecessor
		Funds)

		Officer:
		1 year term

		Served
		since
		June 2008
		for the
		Funds (or
		Predecessor
		Funds)

Teresa M. Nilsen(1)	Executive	1 year term	Ms. Nilsen has been	N/A	N/A
Age: 48	Vice		employed by Hennessy
Address:	President	Served	Advisors, Inc., the Funds’
c/o Hennessy	and	since	investment advisor, since
Advisors, Inc.	Treasurer	January	1989. She currently serves
7250 Redwood Blvd.		1996	as Executive Vice President,
Suite 200		for the	Chief Operations Officer,
Novato, CA 94945		Funds (or	Chief Financial Officer, and
		Predecessor	Secretary of Hennessy
		Funds)	Advisors, Inc.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.
(2)	Pursuant to an internal reorganization, the series of Hennessy Mutual Funds, Inc. (“HMFI”), The Hennessy Funds, Inc. (“HFI”) and Hennessy SPARX Funds Trust (“HSFT”) were reorganized into series of Hennessy Funds Trust on February 28, 2014, which mirrored the corresponding series of HFMI, HFI and HSFT. Subsequent to the reorganization, HFMI, HFI and HSFT were dissolved.

HENNESSYFUNDS.COM

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Daniel B. Steadman(1)	Executive	1 year term	Mr. Steadman has been employed by
Age: 58	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Secretary	Served since	investment advisor, since 2000.
c/o Hennessy Advisors, Inc.		March 2000	He currently serves as Executive
7250 Redwood Blvd.		for the Funds (or	Vice President and Chief Compliance
Suite 200		Predecessor Funds)	Officer of Hennessy Advisors, Inc.
Novato, CA 94945

Jennifer Cheskiewicz(1)	Senior	1 year term	Ms. Cheskiewicz has been employed by
Age: 37	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Chief	Served since	investment advisor, since June 2013.
c/o Hennessy Advisors, Inc.	Compliance	June 2013	She previously served as in-house
7250 Redwood Blvd.	Officer	for the Funds (or	counsel to Carlson Capital, L.P., an
Suite 200		Predecessor Funds)	SEC-registered investment advisor to
Novato, CA 94945			several private funds from February
			2010 to May 2013. Prior to that, she
			was an attorney with Gibson, Dunn &
			Crutcher LLP from September 2005
			through February 2010. She currently
			serves as General Counsel of
			Hennessy Advisors, Inc.

Brian Carlson(1)	Senior	1 year term	Mr. Carlson has been employed by
Age: 42	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Head of	Served since	investment advisor, since
c/o Hennessy Advisors, Inc.	Distribution	December 2013	December 2013.
7250 Redwood Blvd.		for the Funds (or
Suite 200		Predecessor Funds)	Mr. Carlson was previously a
Novato, CA 94945			co-founder and principal of Trivium
			Consultants, LLC from February 2011
			through November 2013. Prior to that,
			he was the Senior Managing Director
			of NRP Financial, Inc. from August
			2007 through February 2011.

David Ellison(1)	Portfolio Manager	1 year term	Mr. Ellison has served as Portfolio
Age: 56	and Senior		Manager of the Large Cap Financial
Address:	Vice President	Served since	Fund, the Small Cap Financial Fund,
c/o Hennessy Advisors, Inc.		October 2012	and the Technology Fund
101 Federal Street		for the Funds (or	since inception.
Suite 1900		Predecessor Funds)
Boston, MA 02110			Mr. Ellison previously served as Director,
			CIO and President of FBR Advisers, Inc.
			from December 1999 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSY FUNDS 1-800-966-4354

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Brian Peery(1)	Portfolio Manager	1 year term	Mr. Peery has been a Portfolio Manager
Age: 45	and		of the Cornerstone Growth Fund,
Address:	Vice President	Served since	the Cornerstone Mid Cap 30 Fund, the
c/o Hennessy Advisors, Inc.		March 2003	Cornerstone Large Growth Fund, the
7250 Redwood Blvd.		as Vice President	Cornerstone Value Fund, the Total
Suite 200		for the Funds (or	Return Fund, and the Balanced Fund
Novato, CA 94945		Predecessor Funds)	since October 2014. From February
			2011 through September 2014, he
		Served since	served as Co-Portfolio Manager of
		February 2011	the same funds.
		as Co-Portfolio
		Manager	Mr. Peery has been employed by
		for the Funds (or	Hennessy Advisors, Inc., the Funds’
		Predecessor Funds)	investment advisor, since 2002.

Winsor (Skip) Aylesworth(1)	Portfolio Manager	1 year term	Mr. Aylesworth has been Portfolio
Age: 67	and		Manager of the Gas Utility Index Fund
Address:	Vice President	Served since	since 1998 and Portfolio Manager of
c/o Hennessy Advisors, Inc.		October 2012	the Technology Fund since inception.
101 Federal Street		for the Funds (or
Suite 1900		Predecessor Funds)	Mr. Aylesworth previously served as
Boston, MA 02110			Executive Vice President of The FBR
			Funds from 1999 to October 2012.

Ryan Kelley(1)	Portfolio Manager	1 year term	Mr. Kelley has been a Portfolio Manager
Age: 42	and		of the Gas Utility Index Fund (formerly
Address:	Vice President	Served since	the FBR Gas Utility Index Fund), the
c/o Hennessy Advisors, Inc.		March 2013	Small Cap Financial Fund (formerly the
1340 Environ Way		for the Funds (or	FBR Small Cap Financial Fund), and the
Chapel Hill, NC 27517		Predecessor Funds)	Large Cap Financial Fund (formerly the
			FBR Large Cap Financial Fund) since
			October 2014. From March 2013
			through September 2014, he served
			as a Co-Portfolio Manager of the same
			funds. Prior to that, he was a Portfolio
			Analyst of the Hennessy Funds.

			Mr. Kelley previously served as Portfolio
			Manager of The FBR Funds from
			January 2008 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSYFUNDS.COM

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HENNESSY FUNDS 1-800-966-4354

Expense Example (Unaudited)

October 31, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSYFUNDS.COM

	Beginning	Ending	Expenses Paid
	Account Value	Account Value	During Period(1)
	5/1/14	10/31/14	5/1/14 – 10/31/14
Investor Class

Actual	$1,000.00	$1,055.40	$6.89

Hypothetical (5% return
before expenses)	$1,000.00	$1,018.50	$6.77

Institutional Class

Actual	$1,000.00	$1,057.30	$5.39

Hypothetical (5% return
before expenses)	$1,000.00	$1,019.91	$5.30

(1)	Expenses are equal to the Fund’s expense ratio of 1.33% for Investor Class shares or 1.04% for Institutional Class shares, as applicable, multiplied by the average account value over the period, multiplied by 184/365 days (to reflect one-half year period).

HENNESSY FUNDS 1-800-966-4354

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, 2014 was 100%.

Householding

HENNESSYFUNDS.COM

We collect the following non-public personal information about you:

	•	information we receive from you on or in applications or other forms, correspondence, or conversations, including, but not limited to, your name, address, phone number, social security number, assets, income and date of birth;
		and
	•	information about your transactions with us, our affiliates, or others, including, but not limited to, your account number and balance, payment history, parties to transactions, cost basis information and other financial information.

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

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.

ANNUAL REPORT

OCTOBER 31, 2014

HENNESSY GAS UTILITY

INDEX FUND

Investor Class GASFX

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	12
Statement of Operations	13
Statements of Changes in Net Assets	15
Financial Highlights	16
Notes to the Financial Statements	18
Report of Independent Registered Public Accounting Firm	25
Trustees and Officers of the Fund	26
Expense Example	30
Proxy Voting	32
Quarterly Filings on Form N-Q	32
Federal Tax Distribution Information	32
Householding	32
Privacy Policy	33

HENNESSY FUNDS 1-800-966-4354

December 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 Index 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)

CHANGE IN VALUE OF $10,000 INVESTMENT

AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED OCTOBER 31, 2014

	One	Five	Ten
	Year	Years	Years
Hennessy Gas Utility
Index Fund (GASFX)	22.49%	20.41%	13.11%
AGA Stock Index*	23.37%	21.09%	13.94%
S&P 500 Index	17.27%	16.69%	8.20%

Expense ratio: 0.80%

The expense ratio presented is from the most recent prospectus.

*	The AGA Stock Index is a market capitalization-weighted index, adjusted monthly, consisting of member companies of the AGA. Performance for the AGA Stock Index is provided monthly by the American Gas Association.

HENNESSYFUNDS.COM

PERFORMANCE NARRATIVE

Portfolio Managers Winsor H. (Skip) Aylesworth and Ryan Kelley

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

For the twelve-month period ended October 31, 2014, the Hennessy Gas Utility Index Fund returned 22.49%, slightly underperforming the American Gas Association (AGA) Stock Index*, which returned 23.37% for the same period, but significantly outperforming the S&P 500 Index and the Morningstar Utilities Category Average, which returned 17.27%, and 16.79% 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 88% and 78%, respectively, for the period. This is the third straight year that Cheniere has been a top performer, and the second year that Energy Transfer has been a top performer. 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 from the U.S., with shipments 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 at the corporate level, which makes it particularly attractive to income-oriented investors. Both companies have benefited from the interest in LNG exporting due to the geopolitical climate in Eastern Europe. Both companies were two of the Fund’s largest holdings for the twelve-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 Energen Corp. and MDU Resources Group, Inc., which returned -13% and -3%, respectively. Energen Corp. is an energy holding company engaged in the development, exploration and production of oil, natural gas and natural gas liquids. MDU Resources Group, Inc. is a diversified company which services the energy and transportation sectors, with one segment that generates and transmits electricity and natural gas. Both companies have been negatively impacted by their exposure to the exploration and production (E&P) sector of the Energy industry. While Energen sold its distribution business to concentrate on E&P, MDU is looking to divest itself of the E&P exposure in order to concentrate on distribution.

There was one addition and two deletions to the AGA Stock Index, and thus the Fund’s portfolio, during the period. The addition was Plains GP Holdings LP, a Houston based holding company engaged in transportation, storage and marketing of crude oil and natural gas liquids. It is the General Partner of Plains All America Pipeline, LP, a pipeline Master Limited Partnership (MLP). The two stocks deleted were Energen Corp. and UNS Energy Corp. In a decision to concentrate on the E&P side of the industry, Energen sold its natural gas distribution subsidiary to The Laclede Group, Inc., another AGA member. As a result of the divestiture, Energen decided to drop its membership in AGA. UNS Energy Corp. left the index as a result of being acquired by a Canadian utility, Fortis, Inc. This is the second acquisition for Fortis of an AGA member in the last two years. Fortis, Inc. is a large electric and gas utility based in British Columbia, Canada. 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 member of the AGA.

HENNESSY FUNDS 1-800-966-4354

Additional Portfolio Manager Commentary and related investment outlook:

The natural gas distribution industry continues to thrive in the current environment of ample supply, historically low and stable prices, and the concerns about climate change. As the cleanest of the fossil fuels, natural gas is the energy source of choice as utilities replace aging coal-fired generating facilities.

We are currently seeing the same revolution in the oil industry that we saw in the natural gas industry. By using the same technologies of fracking and horizontal drilling, the U.S. is finding more oil than ever before. We are seeing oil production increasing, while imports are decreasing. The result is a lowering of oil prices. As we see the price difference between oil based energy (gas/diesel) and natural gas narrow, the adoption of natural gas as a mainstream transportation fuel is slowing. If oil prices go up, we could expect a quicker adoption of natural gas-based transportation solutions.

Geopolitics in Europe and Asia have generally resulted in both economies slowing with resultant reductions in energy demand. Price spreads for LNG between Europe, China and the U.S. have narrowed which, if they hold, could slow the LNG export industry.

So having finished another good year for the Fund, what can investors expect going forward with this somewhat mixed outlook? As an index fund, its goal is to provide the return of the index less expenses. We strive to continue our long term record of accomplishing this. Since the members of the AGA Stock Index are all involved in the distribution side of the natural gas industry, their future growth is directly related to the growth of natural gas as an energy source. As long as we continue to have long term supplies of proven reserves and prices remain historically low and relatively stable, prospects should continue to be good for portfolio companies.

The AGA Stock Index is a market capitalization-weighted index, adjusted monthly, consisting of member companies of the AGA. Performance for the AGA Stock Index is provided monthly by the American Gas Association. 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.

Cash flow measures the cash generating capability of a company by adding non-cash charges (e.g. depreciation) and interest expense to pre-tax income.

HENNESSYFUNDS.COM

Financial Statements

Schedule of Investments

HENNESSY GAS UTILITY INDEX FUND

As of October 31, 2014

(% of Net Assets)

TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS

Cheniere Energy, Inc.	4.92%
Sempra Energy	4.91%
National Grid PLC	4.90%
Dominion Resources, Inc.	4.88%
Kinder Morgan, Inc.	4.88%
Spectra Energy Corp.	4.87%
TransCanada Corp.	4.86%
Enbridge, Inc.	4.85%
NiSource, Inc.	4.85%
ONEOK, Inc.	4.26%

HENNESSY FUNDS 1-800-966-4354

COMMON STOCKS – 96.05%	Number				% of
	of Shares		Value		Net Assets
Energy – 26.73%
Cheniere Energy, Inc. (a)		1,479,117	$	110,933,775		4.92	%
Enbridge, Inc. (c)		2,310,997		109,448,818		4.85	%
EQT Corp.		562,732		52,919,317		2.35	%
Kinder Morgan, Inc.		2,844,725		110,090,858		4.88	%
Spectra Energy Corp.		2,804,615		109,744,585		4.87	%
TransCanada Corp. (c)		2,225,927		109,715,942		4.86	%
				602,853,295		26.73	%

Financials – 0.53%
Berkshire Hathaway, Inc., Class A (a)		57		11,970,000		0.53	%

Utilities – 68.79%
AGL Resources, Inc.		1,293,116		69,711,884		3.09	%
ALLETE, Inc.		3,900		203,736		0.01	%
Alliant Energy Corp.		109,154		6,757,724		0.30	%
Ameren Corp.		263,890		11,173,103		0.50	%
Atmos Energy Corp.		1,334,962		70,752,986		3.14	%
Avista Corp.		158,472		5,617,832		0.25	%
Black Hills Corp.		119,459		6,537,991		0.29	%
Centerpoint Energy, Inc.		1,272,726		31,245,423		1.39	%
Chesapeake Utilities Corp.		144,140		6,980,700		0.31	%
CMS Energy Corp.		1,092,648		35,696,810		1.58	%
Consolidated Edison, Inc.		656,386		41,588,617		1.84	%
Corning Natural Gas Holding Corp.		29,687		656,825		0.03	%
Delta Natural Gas Company, Inc.		90,047		1,865,774		0.08	%
Dominion Resources, Inc.		1,541,896		109,937,185		4.88	%
DTE Energy Co.		431,954		35,489,341		1.57	%
Duke Energy Corp.		201,837		16,580,910		0.74	%
Entergy Corp.		18,050		1,516,561		0.07	%
Exelon Corp.		647,881		23,705,966		1.05	%
Gas Natural, Inc.		94,250		1,069,737		0.05	%
Iberdrola SA- ADR (c)		557,830		15,814,480		0.70	%
Integrys Energy Group, Inc.		497,488		36,157,428		1.60	%
MDU Resources Group, Inc.		971,407		27,374,249		1.21	%
MGE Energy, Inc.		58,496		2,601,317		0.12	%
National Fuel Gas Co.		568,824		39,379,685		1.75	%

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 Grid PLC – ADR (c)		1,484,923	$	110,463,422		4.90	%
New Jersey Resources Corp.		367,642		21,499,704		0.95	%
NiSource, Inc.		2,602,131		109,445,630		4.85	%
Northeast Utilities		420,975		20,775,116		0.92	%
Northwest Natural Gas Co.		321,865		15,105,124		0.67	%
Northwestern Corp.		150,198		7,936,462		0.35	%
One Gas, Inc.		613,578		23,285,285		1.03	%
ONEOK, Inc.		1,629,098		96,019,036		4.26	%
Pepco Holdings, Inc.		114,904		3,141,475		0.14	%
PG&E Corp.		1,556,799		78,338,126		3.47	%
Piedmont Natural Gas Company, Inc.		1,007,720		38,303,437		1.70	%
PPL Corp.		149,535		5,232,230		0.23	%
Public Service Enterprise Group, Inc.		1,337,790		55,264,105		2.45	%
Questar Corp.		1,719,119		41,447,959		1.84	%
RGC Resources, Inc.		58,219		1,178,353		0.05	%
SCANA Corp.		310,966		17,068,924		0.76	%
Sempra Energy		1,005,940		110,653,400		4.91	%
South Jersey Industries, Inc.		263,128		15,429,826		0.68	%
Southwest Gas Corp.		581,840		33,799,086		1.50	%
TECO Energy, Inc.		432,236		8,476,148		0.38	%
The Empire District Electric Co.		31,600		898,704		0.04	%
The Laclede Group, Inc.		533,111		27,066,045		1.20	%
UGI Corp.		454,402		17,126,411		0.76	%
UIL Holdings Corp.		289,133		11,894,932		0.53	%
Unitil Corp.		98,868		3,444,561		0.15	%
Vectren Corp.		479,416		21,549,749		0.96	%
WGL Holdings, Inc.		496,237		23,323,139		1.03	%
Wisconsin Energy Corp.		220,460		10,948,044		0.49	%
Xcel Energy, Inc.		703,399		23,542,765		1.04	%
				1,551,073,462		68.79	%
Total Common Stocks
(Cost $1,627,542,446)				2,165,896,757		96.05	%

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

HENNESSY FUNDS 1-800-966-4354

PARTNERSHIPS – 3.10%	Number				% of
	of Shares		Value		Net Assets
Energy – 3.10%
Energy Transfer Equity LP		746,288	$	43,553,368		1.93	%
Plains GP Holdings LP		919,577		26,373,468		1.17	%
				69,926,836		3.10	%
Total Partnerships
(Cost $30,299,238)				69,926,836		3.10	%

SHORT-TERM INVESTMENTS – 0.41%
Money Market Funds – 0.41%
Fidelity Government Portfolio –
Institutional Class, 0.01% (b)		9,277,444		9,277,444		0.41	%

Total Short-Term Investments
(Cost $9,277,444)				9,277,444		0.41	%

Total Investments
(Cost $1,667,119,128) – 99.56%				2,245,101,037		99.56	%
Other Assets in Excess
of Liabilities – 0.44%				9,880,483		0.44	%
TOTAL NET ASSETS – 100.00%			$	2,254,981,520		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 October 31, 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 October 31, 2014

The following is a summary of the inputs used to value the Fund’s net assets as of October 31, 2014 (See Note 3 in the accompanying notes to the financial statements):

Common Stocks	Level 1		Level 2		Level 3		Total
Energy	$	602,853,295	$	—	$	—	$	602,853,295
Financials		11,970,000		—		—		11,970,000
Utilities		1,550,416,637		656,825		—		1,551,073,462
Total Common Stocks	$	2,165,239,932	$	656,825	$	—	$	2,165,896,757
Partnerships
Energy	$	69,926,836	$	—	$	—	$	69,926,836
Total Partnerships	$	69,926,836	$	—	$	—	$	69,926,836
Short-Term Investments
Money Market Funds	$	9,277,444	$	—	$	—	$	9,277,444
Total Short-Term Investments	$	9,277,444	$	—	$	—	$	9,277,444
Total Investments	$	2,244,444,212	$	656,825	$	—	$	2,245,101,037

Transfers between levels are recognized at the end of the reporting period. During the year ended October 31, 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 October 31, 2014

ASSETS:
Investments in securities, at value (cost $1,667,119,128)	$	2,245,101,037
Cash		731,365
Dividends and interest receivable		3,643,015
Receivable for fund shares sold		6,539,497
Receivable for securities sold		16,313,564
Return of capital receivable		371,960
Prepaid expenses and other assets		61,796
Total Assets		2,272,762,234

LIABILITIES:
Payable for securities purchased		13,755,157
Payable for fund shares redeemed		2,373,652
Payable to advisor		730,573
Payable to administrator		378,188
Payable to auditor		19,101
Accrued interest payable		3,888
Accrued trustees fees		1,748
Accrued expenses and other payables		518,407
Total Liabilities		17,780,714
NET ASSETS	$	2,254,981,520

NET ASSETS CONSIST OF:
Capital stock	$	1,644,165,856
Accumulated net investment income		953,691
Accumulated net realized gain on investments		31,880,064
Unrealized net appreciation on investments		577,981,909
Total Net Assets	$	2,254,981,520

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares		2,254,981,520
Shares issued and outstanding		72,047,128
Net asset value, offering price and redemption price per share	$	31.30

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

HENNESSYFUNDS.COM

Financial Statements

Statement of Operations for the year ended October 31, 2014

INVESTMENT INCOME:
Dividend income(1)	$	51,183,131
Interest income		2,324
Total investment income		51,185,455

EXPENSES:
Investment advisory fees (See Note 5)		6,761,138
Sub-transfer agent expenses – Investor Class (See Note 5)		3,185,943
Administration, fund accounting, custody and transfer agent fees		1,904,647
Membership fees		676,114
Reports to shareholders		179,021
Federal and state registration fees		57,765
Compliance expense		21,488
Legal fees		21,029
Trustees’ fees and expenses		21,019
Audit fees		19,100
Interest expense (See Note 6)		3,889
Other expenses		83,765
Total expenses		12,934,918
NET INVESTMENT INCOME	$	38,250,537

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	47,518,015
Net change in unrealized appreciation on investments		248,176,790
Net gain on investments		295,694,805
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	333,945,342

(1)	Net of foreign taxes withheld and issuance fees of $842,582.

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

HENNESSY FUNDS 1-800-966-4354

(This Page Intentionally Left Blank.)

HENNESSYFUNDS.COM

Financial Statements

Statements of Changes in Net Assets

	Year Ended			Year Ended
	October 31, 2014			October 31, 2013
OPERATIONS:
Net investment income	$	38,250,537		$	23,732,673
Net realized gain on investments		47,518,015			20,377,887
Net change in unrealized appreciation on investments		248,176,790			131,840,690
Net increase in net assets resulting from operations		333,945,342			175,951,250

DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income – Investor Class		(36,086,377	)		(23,162,526	)
Net realized gains – Investor Class		(27,515,134	)		(17,562,108	)
Total distributions		(63,601,511	)		(40,724,634	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from shares subscribed – Investor Class		1,127,467,551			575,374,779
Dividends reinvested – Investor Class		60,140,074			38,473,417
Cost of shares redeemed – Investor Class		(385,760,784	)(1)		(313,104,396	)(2)
Net increase in net assets derived
from capital share transactions		801,846,841			300,743,800
TOTAL INCREASE IN NET ASSETS		1,072,190,672			435,970,416

NET ASSETS:
Beginning of year		1,182,790,848			746,820,432
End of year	$	2,254,981,520		$	1,182,790,848
Undistributed net investment income, end of year	$	953,691		$	—

CHANGES IN SHARES OUTSTANDING:
Shares sold – Investor Class		38,906,149			23,099,378
Shares issued to holders as reinvestment
of dividends – Investor Class		2,174,333			1,647,989
Shares redeemed – Investor Class		(13,350,971	)		(12,830,834	)
Net increase in shares outstanding		27,729,511			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 fiscal year 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 the fiscal year 2013.

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Financial Highlights

For an Investor Class share outstanding throughout each year

PER SHARE DATA:

Net asset value, beginning of year

Income from investment operations:

Net investment income

Net realized and unrealized gains on investments

Total from investment operations

Less distributions:

Dividends from net investment income

Dividends from net realized gains

Total distributions

Paid-in capital from redemption fees

Net asset value, end of year

TOTAL RETURN

SUPPLEMENTAL DATA AND RATIOS:

Net assets, end of year (millions)

Ratio of expenses to average net assets:

Before expense reimbursement

After expense reimbursement

Ratio of net investment income to average net assets:

Before expense reimbursement

After expense reimbursement

Portfolio turnover rate

(1)	Calculated based on average shares outstanding method.
(2)	Amount is less than $0.01.

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

HENNESSYFUNDS.COM

Year Ended October 31,
2014			2013			2012			2011			2010

$	26.69		$	23.05		$	21.21		$	17.83		$	15.13


	0.62			0.62			0.58			0.51	(1)		0.58
	5.18			4.18			1.99			3.59			2.72
	5.80			4.80			2.57			4.10			3.30


	(0.59	)		(0.61	)		(0.58	)		(0.51	)		(0.58	)
	(0.60	)		(0.55	)		(0.16	)		(0.21	)		(0.02	)
	(1.19	)		(1.16	)		(0.74	)		(0.72	)		(0.60	)
	0.00	(2)		0.00	(2)		0.01			0.00	(2)		0.00	(2)
$	31.30		$	26.69		$	23.05		$	21.21		$	17.83

	22.49	%		21.70	%		12.41	%		23.54	%		22.25	%


$	2,254.98		$	1,182.79		$	746.82		$	433.78		$	244.04

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

	2.26	%		2.56	%		2.72	%		2.68	%		3.50	%
	2.26	%		2.56	%		2.72	%		2.68	%		3.51	%
	20	%		18	%		16	%		17	%		16	%

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

HENNESSY FUNDS 1-800-966-4354

Financial Statements

Notes to Financial Statements October 31, 2014

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.
	Due to inherent differences in the recognition of income, expenses, and realized gains/losses under GAAP and federal income tax regulations, permanent differences between book and tax basis reporting for the 2014 fiscal year have been identified and appropriately reclassified on the Statement of Assets and Liabilities. The adjustments are as follow:

Undistributed	Accumulated
Net Investment	Net Realized
Loss	Gain	Paid-in Capital
$(1,210,469)	$746,577	$463,892

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.

HENNESSYFUNDS.COM

	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 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 NAV 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 fiscal year ended October 31, 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 to cover the repurchase amount 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 tax returns of the Fund for the prior three fiscal years are open for examination. 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.
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 fiscal year ended October 31, 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 October 31, 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-

HENNESSYFUNDS.COM

		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.

HENNESSY FUNDS 1-800-966-4354

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 for a security that reflects the amount the Fund might reasonably expect to receive in a current sale. 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 fiscal year ended October 31, 2014 were $1,126,259,820 and $343,383,164, respectively.

There were no purchases or sales/maturities of long-term U.S. Government Securities for the Fund during the fiscal year ended October 31, 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 October 31, 2014 were $730,573.

HENNESSYFUNDS.COM

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 0.85% of the Fund’s net assets 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, but the plan has not been implemented as of October 31, 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.

Membership fees are paid to the American Gas Association ("AGA"), which provides administrative services to the Fund pursuant to an Administrative Services Agreement between the Fund and AGA. These administrative services include overseeing the calculation of the Gas Utility Index. AUS Consultants Utility Services performs the actual computations required to produce the Gas Utility Index and receives a fee for such calculations pursuant to a contractual arrangement with AGA. AGA does not furnish other securities advice to the Gas Utility Index Fund or the Manager or make recommendations regarding the purchase or sale of securities by the Gas Utility Index Fund. Under the terms of an agreement approved by the Board of Trustees, AGA provides the Advisor with current information regarding the common stock composition of the Gas Utility Index no less than quarterly but may supply such information more frequently. In addition, AGA provides the Gas Utility Index Fund with information on the natural gas industry. The Fund pays AGA in its capacity as administrator a fee at an annual rate of 0.04% of the average daily net assets of the Fund.

HENNESSY FUNDS 1-800-966-4354

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 fiscal year ended October 31, 2014, the Fund had an outstanding average daily balance and a weighted average interest rate of $179,167 and 3.25%, respectively. The maximum amount outstanding for the Fund during the period was $18,704,000. At October 31, 2014, the Fund had a loan payable balance of $0.

7). FEDERAL TAX INFORMATION

As of October 31, 2014, the components of accumulated earnings (losses) for income tax purposes for the Fund were as follow:

Cost of investments for tax purposes	$	1,701,300,811
Gross tax unrealized appreciation	$	589,799,997
Gross tax unrealized depreciation		(45,999,771	)
Net tax unrealized appreciation	$	543,800,226
Undistributed ordinary income	$	43,176,035
Undistributed long-term capital gains		23,839,403
Total distributable earnings	$	67,015,438
Other accumulated gain	$	—
Total accumulated gain	$	610,815,664

The difference between book-basis and tax-basis unrealized appreciation is attributable primarily to wash sales and partnership adjustments.

At October 31, 2014, the Fund had no tax basis capital losses to offset future capital gains.

At October 31, 2014, the Fund did not defer, on a tax basis, any late year ordinary losses.

The tax character of distributions paid during fiscal year 2014 and fiscal year 2013 for the Fund were as follow:

	Year Ended		Year Ended
	October 31, 2014		October 31, 2013
Ordinary income	$	46,037,795	$	25,896,541
Long-term capital gain		17,563,716		14,828,093
	$	63,601,511	$	40,724,634

8). EVENTS SUBSEQUENT TO YEAR-END

On December 8, 2014, a short-term capital gains distribution of $0.57900 per share and long-term capital gains distribution of $0.32673 per share were declared and paid to shareholders of record on December 5, 2014.

HENNESSYFUNDS.COM

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of Hennessy Funds Trust

And the Shareholders of Hennessy Gas Utility Index Fund

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of the Hennessy Gas Utility Index Fund (the “Fund”), a series of Hennessy Funds Trust (the “Trust”) as of October 31, 2014, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2014, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Hennessy Gas Utility Index Fund as of October 31, 2014, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

TAIT, WELLER & BAKER LLP

Philadelphia, Pennsylvania

December 30, 2014

HENNESSY FUNDS 1-800-966-4354

Trustees and Officers of the Fund (Unaudited)

				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

Disinterested Trustees (as defined below)

J. Dennis DeSousa	Trustee	Indefinite,	Mr. DeSousa is a real	16	Hennessy SPARX
Age: 78		until	estate investor.		Funds Trust;
Address:		successor			Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Robert T. Doyle	Trustee	Indefinite,	Mr. Doyle has been the	16	Hennessy SPARX
Age: 67		until	Sheriff of Marin County,		Funds Trust;
Address:		successor	California since 1996.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		January
		1996
		for the
		Funds (or
		Predecessor
		Funds)

Gerald P. Richardson	Trustee	Indefinite,	Mr. Richardson is an	16	Hennessy SPARX
Age: 69		until	independent consultant		Funds Trust;
Address:		successor	in the securities industry.		Hennessy Mutual
c/o Hennessy		elected			Funds, Inc.; and
Advisors, Inc.					The Hennessy
7250 Redwood Blvd.		Served			Funds, Inc.
Suite 200		since
Novato, CA 94945		May 2004
		for the
		Funds (or
		Predecessor
		Funds)

HENNESSYFUNDS.COM

				Number of
		Term of		Portfolios
		Office		in the	Other
		and		Fund	Directorships
	Position(s)	Length	Principal	Complex	(During Past
Name, Address,	Held with	of Time	Occupation(s)	Overseen	Five Years)(2)
and Age	the Fund	Served	During Past Five Years	by Trustee	Held by Trustee

“Interested Persons” (as defined in the 1940 Act)

Neil J. Hennessy(1)	Chief	Trustee:	Mr. Hennessy has been	16	Hennessy
Age: 58	Investment	Indefinite,	employed by Hennessy		Advisors, Inc.
Address:	Officer,	until	Advisors, Inc., the Funds’		(current);
c/o Hennessy	Portfolio	successor	investment advisor, since		Hennessy SPARX
Advisors, Inc.	Manager,	elected	1989. He currently serves		Funds Trust;
7250 Redwood Blvd.	President,		as President, Chairman		Hennessy Mutual
Suite 200	Trustee	Served	and CEO of Hennessy		Funds, Inc.; and
Novato, CA 94945	and	since	Advisors, Inc.		The Hennessy
	Chairman	January			Funds, Inc.
	of the	1996
	Board	for the
		Funds (or
		Predecessor
		Funds)

		Officer:
		1 year term

		Served
		since
		June 2008
		for the
		Funds (or
		Predecessor
		Funds)

Teresa M. Nilsen(1)	Executive	1 year term	Ms. Nilsen has been	N/A	N/A
Age: 48	Vice		employed by Hennessy
Address:	President	Served	Advisors, Inc., the Funds’
c/o Hennessy	and	since	investment advisor, since
Advisors, Inc.	Treasurer	January	1989. She currently serves
7250 Redwood Blvd.		1996	as Executive Vice President,
Suite 200		for the	Chief Operations Officer,
Novato, CA 94945		Funds (or	Chief Financial Officer, and
		Predecessor	Secretary of Hennessy
		Funds)	Advisors, Inc.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.
(2)	Pursuant to an internal reorganization, the series of Hennessy Mutual Funds, Inc. (“HMFI”), The Hennessy Funds, Inc. (“HFI”) and Hennessy SPARX Funds Trust (“HSFT”) were reorganized into series of Hennessy Funds Trust on February 28, 2014, which mirrored the corresponding series of HFMI, HFI and HSFT. Subsequent to the reorganization, HFMI, HFI and HSFT were dissolved.

HENNESSY FUNDS 1-800-966-4354

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Daniel B. Steadman(1)	Executive	1 year term	Mr. Steadman has been employed by
Age: 58	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Secretary	Served since	investment advisor, since 2000.
c/o Hennessy Advisors, Inc.		March 2000	He currently serves as Executive
7250 Redwood Blvd.		for the Funds (or	Vice President and Chief Compliance
Suite 200		Predecessor Funds)	Officer of Hennessy Advisors, Inc.
Novato, CA 94945

Jennifer Cheskiewicz(1)	Senior	1 year term	Ms. Cheskiewicz has been employed by
Age: 37	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Chief	Served since	investment advisor, since June 2013.
c/o Hennessy Advisors, Inc.	Compliance	June 2013	She previously served as in-house
7250 Redwood Blvd.	Officer	for the Funds (or	counsel to Carlson Capital, L.P., an
Suite 200		Predecessor Funds)	SEC-registered investment advisor to
Novato, CA 94945			several private funds from February
			2010 to May 2013. Prior to that, she
			was an attorney with Gibson, Dunn &
			Crutcher LLP from September 2005
			through February 2010. She currently
			serves as General Counsel of
			Hennessy Advisors, Inc.

Brian Carlson(1)	Senior	1 year term	Mr. Carlson has been employed by
Age: 42	Vice President		Hennessy Advisors, Inc., the Funds’
Address:	and Head of	Served since	investment advisor, since
c/o Hennessy Advisors, Inc.	Distribution	December 2013	December 2013.
7250 Redwood Blvd.		for the Funds (or
Suite 200		Predecessor Funds)	Mr. Carlson was previously a
Novato, CA 94945			co-founder and principal of Trivium
			Consultants, LLC from February 2011
			through November 2013. Prior to that,
			he was the Senior Managing Director
			of NRP Financial, Inc. from August
			2007 through February 2011.

David Ellison(1)	Portfolio Manager	1 year term	Mr. Ellison has served as Portfolio
Age: 56	and Senior		Manager of the Large Cap Financial
Address:	Vice President	Served since	Fund, the Small Cap Financial Fund,
c/o Hennessy Advisors, Inc.		October 2012	and the Technology Fund
101 Federal Street		for the Funds (or	since inception.
Suite 1900		Predecessor Funds)
Boston, MA 02110			Mr. Ellison previously served as Director,
			CIO and President of FBR Advisers, Inc.
			from December 1999 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSYFUNDS.COM

		Term of
		Office
		and
	Position(s)	Length	Principal
Name, Address,	Held with	of Time	Occupation(s)
and Age	the Fund	Served	During Past Five Years

Interested Persons

Brian Peery(1)	Portfolio Manager	1 year term	Mr. Peery has been a Portfolio Manager
Age: 45	and		of the Cornerstone Growth Fund,
Address:	Vice President	Served since	the Cornerstone Mid Cap 30 Fund, the
c/o Hennessy Advisors, Inc.		March 2003	Cornerstone Large Growth Fund, the
7250 Redwood Blvd.		as Vice President	Cornerstone Value Fund, the Total
Suite 200		for the Funds (or	Return Fund, and the Balanced Fund
Novato, CA 94945		Predecessor Funds)	since October 2014. From February
			2011 through September 2014, he
		Served since	served as Co-Portfolio Manager of
		February 2011	the same funds.
		as Co-Portfolio
		Manager	Mr. Peery has been employed by
		for the Funds (or	Hennessy Advisors, Inc., the Funds’
		Predecessor Funds)	investment advisor, since 2002.

Winsor (Skip) Aylesworth(1)	Portfolio Manager	1 year term	Mr. Aylesworth has been Portfolio
Age: 67	and		Manager of the Gas Utility Index Fund
Address:	Vice President	Served since	since 1998 and Portfolio Manager of
c/o Hennessy Advisors, Inc.		October 2012	the Technology Fund since inception.
101 Federal Street		for the Funds (or
Suite 1900		Predecessor Funds)	Mr. Aylesworth previously served as
Boston, MA 02110			Executive Vice President of The FBR
			Funds from 1999 to October 2012.

Ryan Kelley(1)	Portfolio Manager	1 year term	Mr. Kelley has been a Portfolio Manager
Age: 42	and		of the Gas Utility Index Fund (formerly
Address:	Vice President	Served since	the FBR Gas Utility Index Fund), the
c/o Hennessy Advisors, Inc.		March 2013	Small Cap Financial Fund (formerly the
1340 Environ Way		for the Funds (or	FBR Small Cap Financial Fund), and the
Chapel Hill, NC 27517		Predecessor Funds)	Large Cap Financial Fund (formerly the
			FBR Large Cap Financial Fund) since
			October 2014. From March 2013
			through September 2014, he served
			as a Co-Portfolio Manager of the same
			funds. Prior to that, he was a Portfolio
			Analyst of the Hennessy Funds.

			Mr. Kelley previously served as Portfolio
			Manager of The FBR Funds from
			January 2008 to October 2012.

(1)	All Officers of the Hennessy Funds and employees of the Manager are Interested Persons of the Funds.

HENNESSY FUNDS 1-800-966-4354

Expense Example (Unaudited)

October 31, 2014

Actual Expenses

Hypothetical Example for Comparison Purposes

HENNESSYFUNDS.COM

	Beginning	Ending	Expenses Paid
	Account Value	Account Value	During Period(1)
	5/1/14	10/31/14	5/1/14 – 10/31/14
Investor Class

Actual	$1,000.00	$1,079.30	$3.98

Hypothetical (5% return
before expenses)	$1,000.00	$1,021.37	$3.87

(1)	Expenses are equal to the Fund’s expense ratio of 0.76% for Investor Class shares, as applicable multiplied by the average account value over the period, multiplied by 184/365 days (to reflect one-half year period).

HENNESSY FUNDS 1-800-966-4354

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, 2014 was 58.73%.

Householding

HENNESSYFUNDS.COM

We collect the following non-public personal information about you:

	•	information we receive from you on or in applications or other forms, correspondence, or conversations, including, but not limited to, your name, address, phone number, social security number, assets, income and date of birth;
		and
	•	information about your transactions with us, our affiliates, or others, including, but not limited to, your account number and balance, payment history, parties to transactions, cost basis information and other financial information.

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.

	One	Five	Ten
	Year	Years	Years
Hennessy Cornerstone Growth Fund –
Investor Class (HFCGX)	19.36%	16.22%	5.41%
Hennessy Cornerstone Growth Fund –
Institutional Class (HICGX)(1)	19.70%	16.58%	5.63%
Russell 2000® Index	8.06%	17.39%	8.67%
S&P 500 Index	17.27%	16.69%	8.20%

Southwest Airlines Co.	2.87%
Core-Mark Holding Co., Inc.	2.66%
Universal Insurance Holdings, Inc.	2.59%
Super Micro Computer, Inc.	2.58%
Tuesday Morning Corp.	2.56%
Green Plains Renewable Energy, Inc.	2.45%
Jack In The Box, Inc.	2.39%
Alaska Air Group, Inc.	2.37%
Targa Resources Corp.	2.36%
United Rentals, Inc.	2.35%

COMMON STOCKS – 94.05%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 25.47%
Advance Auto Parts, Inc.		35,400	$	5,202,384		2.05	%
Carmike Cinemas, Inc. (a)		156,327		5,010,281		1.98	%
Core-Mark Holding Co., Inc.		116,044		6,734,033		2.66	%
G-III Apparel Group, Ltd. (a)		66,600		5,284,710		2.09	%
Jack In The Box, Inc.		85,100		6,045,504		2.39	%
Jarden Corp. (a)		74,900		4,875,241		1.92	%
La-Z-Boy, Inc.		163,600		3,739,896		1.48	%
MDC Partners, Inc. (b)		178,197		3,688,678		1.46	%
Papa Johns International, Inc.		92,600		4,329,976		1.71	%
The Goodyear Tire & Rubber Co.		166,100		4,024,603		1.59	%
The New York Times Co.		310,700		3,989,388		1.58	%
Tuesday Morning Corp. (a)		318,011		6,484,244		2.56	%
Visteon Corp. (a)		54,000		5,070,600		2.00	%
				64,479,538		25.47	%

Consumer Staples – 1.90%
Tyson Foods, Inc., Class A		119,400		4,817,790		1.90	%

Energy – 8.22%
Exterran Holdings, Inc.		124,800		4,908,384		1.94	%
Green Plains Renewable Energy, Inc.		181,100		6,193,620		2.45	%
Matrix Service Co. (a)		148,927		3,732,111		1.47	%
Targa Resources Corp.		46,500		5,981,295		2.36	%
				20,815,410		8.22	%

Financials – 7.84%
BGC Partners, Inc.		639,173		5,420,187		2.14	%
CNO Financial Group, Inc.		245,300		4,447,289		1.76	%
LPL Financial Holdings, Inc.		82,900		3,431,231		1.35	%
Universal Insurance Holdings, Inc.		374,700		6,557,250		2.59	%
				19,855,957		7.84	%

Health Care – 6.21%
Alere, Inc. (a)		126,600		5,060,202		2.00	%
CIGNA Corp.		58,800		5,854,716		2.31	%
MWI Veterinary Supply, Inc. (a)		28,300		4,801,236		1.90	%
				15,716,154		6.21	%

COMMON STOCKS	Number				% of
	of Shares		Value		Net Assets
Industrials – 34.19%
Aceto Corp.		236,884	$	5,386,742		2.13	%
Alaska Air Group, Inc.		112,600		5,993,698		2.37	%
Curtiss Wright Corp.		70,200		4,858,542		1.92	%
Delta Air Lines, Inc.		142,700		5,740,821		2.27	%
Engility Holdings, Inc. (a)		109,846		4,745,347		1.87	%
Huntington Ingalls Industries, Inc.		46,900		4,962,958		1.96	%
John Bean Technologies Corp.		152,186		4,561,015		1.80	%
L-3 Communications Holdings, Inc.		39,600		4,809,816		1.90	%
Lennox International, Inc.		50,600		4,499,352		1.77	%
Lockheed Martin Corp.		28,000		5,335,960		2.11	%
Northrop Grumman Corp.		37,600		5,187,296		2.05	%
Primoris Services Corp.		136,200		3,911,664		1.54	%
Raytheon Co.		47,000		4,882,360		1.93	%
Southwest Airlines Co.		211,000		7,275,280		2.87	%
The Manitowoc Co., Inc.		155,500		3,240,620		1.28	%
United Continental Holdings, Inc. (a)		99,200		5,238,752		2.07	%
United Rentals, Inc. (a)		54,100		5,954,246		2.35	%
				86,584,469		34.19	%

Information Technology – 6.45%
CSG Systems International, Inc.		166,600		4,416,566		1.74	%
Hewlett-Packard Co.		150,000		5,382,000		2.13	%
Super Micro Computer, Inc. (a)		204,700		6,542,212		2.58	%
				16,340,778		6.45	%

Materials – 3.77%
AK Steel Holding Corp. (a)		653,100		4,943,967		1.95	%
PolyOne Corp.		124,300		4,600,343		1.82	%
				9,544,310		3.77	%

Total Common Stocks
(Cost $193,157,779)				238,154,406		94.05	%

RIGHTS – 0.00%
Health Care – 0.00%
Forest Laboratories, Inc. (a)(c)		5,500		5,225		0.00	%

Total Rights
(Cost $0)				5,225		0.00	%

PARTNERSHIPS – 1.69%	Number				% of
	of Shares		Value		Net Assets
Energy – 1.69%
NGL Energy Partners LP		124,279	$	4,270,226		1.69	%

Total Partnerships
(Cost $4,197,531)				4,270,226		1.69	%

SHORT-TERM INVESTMENTS – 4.00%
Money Market Funds – 4.00%
Fidelity Government Portfolio –
Institutional Class, 0.01% (d)		10,129,106		10,129,106		4.00	%

Total Short-Term Investments
(Cost $10,129,106)				10,129,106		4.00	%

Total Investments
(Cost $207,484,416) – 99.74%				252,558,963		99.74	%
Other Assets in
Excess of Liabilities – 0.26%				666,661		0.26	%
TOTAL NET ASSETS – 100.00%			$	253,225,624		100.00	%

(1)	The inception date of the Institutional Class shares is March 3, 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.
(2)	With regard to Institutional Class shares, the Fund’s investment advisor has contractually agreed to waive a portion of its expenses indefinitely.

(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 October 31, 2014.

	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 October 31, 2014	$	5,225

Change in unrealized appreciation/depreciation during the period for
Level 3 investments held at October 31, 2014	$	—

INVESTMENT INCOME:
Dividend income(1)	$	2,616,144
Interest income		594
Total investment income		2,616,738

EXPENSES:
Investment advisory fees (See Note 5)		1,826,409
Administration, fund accounting, custody and transfer agent fees		449,986
Sub-transfer agent expenses – Investor Class (See Note 5)		317,684
Sub-transfer agent expenses – Institutional Class (See Note 5)		11,691
Service fees – Investor Class (See Note 5)		221,592
Federal and state registration fees		38,019
Reports to shareholders		35,169
Audit fees		23,555
Compliance expense		21,488
Trustees’ fees and expenses		10,997
Legal fees		7,000
Other expenses		23,521
Total expenses before waiver		2,987,111
Administrative expense waiver (See Note 5)		(13,641	)
Net expenses		2,973,470
NET INVESTMENT LOSS	$	(356,732	)

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	44,803,198
Net change in unrealized depreciation on investments		(404,454	)
Net gain on investments		44,398,744
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	44,042,012

Cost of investments for tax purposes	$	207,541,593
Gross tax unrealized appreciation	$	49,891,912
Gross tax unrealized depreciation		(4,874,542	)
Net tax unrealized appreciation	$	45,017,370
Undistributed ordinary income	$	—
Undistributed long-term capital gains		—
Total distributable earnings	$	—
Other accumulated loss	$	(150,020,565	)
Total accumulated loss	$	(105,003,195	)

TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS
O’Reilly Automotive, Inc.	10.55%
American Tower Corp., Class A	9.66%
Markel Corp.	9.17%
CarMax, Inc.	7.84%
Twenty First Century Fox, Inc.	6.12%
Encore Capital Group, Inc.	5.01%
Brookfield Asset Management, Inc.	5.01%
Aon PLC	4.89%
The Charles Schwab Corp.	4.50%
Gaming & Leisure Properties, Inc.	4.27%

COMMON STOCKS – 75.24%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 29.10%
CarMax, Inc. (a)		2,097,740	$	117,284,643		7.84	%
Dick’s Sporting Goods, Inc.		1,165,767		52,890,849		3.54	%
O’Reilly Automotive, Inc. (a)		897,900		157,922,652		10.55	%
Penn National Gaming, Inc. (a)		1,197,772		15,678,835		1.05	%
Twenty First Century Fox, Inc.		2,657,204		91,620,394		6.12	%
				435,397,373		29.10	%

Energy – 3.22%
World Fuel Services Corp.		1,168,204		48,176,733		3.22	%

Financials – 30.78%
Aon PLC (c)		851,000		73,186,000		4.89	%
Brookfield Asset Management, Inc. (c)		1,530,035		74,925,814		5.01	%
Diamond Hill Investment Group, Inc.		151,439		20,291,312		1.35	%
Encore Capital Group, Inc. (a) (d)		1,646,620		74,937,676		5.01	%
Markel Corp. (a)		198,637		137,236,317		9.17	%
Marlin Business Services Corp.		604,737		12,784,140		0.85	%
The Charles Schwab Corp.		2,346,699		67,279,860		4.50	%
				460,641,119		30.78	%

Health Care – 1.44%
Henry Schein, Inc. (a)		180,000		21,605,400		1.44	%

Industrials – 5.50%
American Woodmark Corp. (a) (d)		817,409		33,440,202		2.23	%
Mistras Group, Inc. (a)		643,294		10,607,918		0.71	%
Roadrunner Transportation Systems, Inc. (a)		904,200		18,635,562		1.25	%
Simpson Manufacturing Company, Inc.		590,832		19,544,723		1.31	%
				82,228,405		5.50	%

Information Technology – 5.20%
Google, Inc. (a)		68,984		38,567,575		2.58	%
Google, Inc., Class A (a)		68,984		39,173,944		2.62	%
				77,741,519		5.20	%
Total Common Stocks
(Cost $622,584,108)				1,125,790,549		75.24	%

REITS – 13.93%	Number					% of
	of Shares		Value			Net Assets
Financials – 13.93%
American Tower Corp., Class A		1,483,679	$	144,658,702			9.66	%
Gaming & Leisure Properties, Inc.		2,043,407		63,856,469			4.27	%
				208,515,171			13.93	%
Total REITS
(Cost $81,851,999)				208,515,171			13.93	%

SHORT-TERM INVESTMENTS – 11.00%
Money Market Funds – 11.00%
Federated Government Obligations Fund – Class I, 0.01% (b)		74,000,000		74,000,000			4.95	%
Federated Treasury Obligations Fund, 0.01% (b)		16,545,872		16,545,872			1.11	%
Fidelity Government Portfolio – Institutional Class, 0.01% (b)		74,000,000		74,000,000			4.94	%
				164,545,872			11.00	%
Total Short-Term Investments
(Cost $164,545,872)				164,545,872			11.00	%

Total Investments
(Cost $868,981,979) – 100.17%				1,498,851,592			100.17	%
Liabilities in Excess
of Other Assets – (0.17)%				(2,511,359	)		(0.17	)%
TOTAL NET ASSETS – 100.00%			$	1,496,340,233			100.00	%

Issuer	American Woodmark Corp.			Encore Capital Group, Inc.
Beginning Cost		$	25,862,840		$	19,557,051
Purchase Cost		$	518,661		$	29,460,269
Sales Cost		$	—		$	—
Ending Cost		$	26,381,501		$	49,017,320
Dividend Income		$	—		$	—
Shares			817,409			1,646,620
Market Value		$	33,440,202		$	74,937,676

ASSETS:
Investments in unaffiliated securities, at value (cost $793,583,158)	$	1,390,473,714
Investments in affiliated securities, at value (cost $75,398,821)		108,377,878
Dividends and interest receivable		195,815
Receivable for fund shares sold		1,251,675
Prepaid expenses and other assets		62,185
Total Assets		1,500,361,267

LIABILITIES:
Payable for fund shares redeemed		2,152,933
Payable to advisor		1,087,730
Payable to administrator		254,071
Payable to auditor		19,104
Accrued distribution fees		258,812
Accrued trustees fees		2,250
Accrued expenses and other payables		246,134
Total Liabilities		4,021,034
NET ASSETS	$	1,496,340,233

NET ASSETS CONSIST OF:
Capital stock	$	753,170,304
Accumulated net realized gain on investments		113,300,316
Unrealized net appreciation on investments		629,869,613
Total Net Assets	$	1,496,340,233

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares	$	1,213,029,559
Shares issued and outstanding		17,462,884
Net asset value, offering price and redemption price per share	$	69.46

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares	$	283,310,674
Shares issued and outstanding		4,018,607
Net asset value, offering price and redemption price per share	$	70.50

Year Ended October 31,
2014			2013			2012			2011			2010

$	15.65		$	12.38		$	9.97		$	10.28		$	8.81


	(0.04	)		(0.11	)		(0.07	)		(0.08	)		(0.10	)
	3.07			3.38			2.48			(0.23	)		1.57
	3.03			3.27			2.41			(0.31	)		1.47

$	18.68		$	15.65		$	12.38		$	9.97		$	10.28

	19.36	%		26.41	%		24.17	%		(3.02	)%		16.69	%


$	227.68		$	220.83		$	265.60		$	184.40		$	207.11
	1.23	%		1.29	%		1.34	%		1.33	%		1.34	%
	(0.17	)%		(0.26	)%		(0.66	)%		(0.78	)%		(0.89	)%
	84	%		105	%		90	%		106	%		103	%

Year Ended October 31,
2014			2013			2012			2011			2010

$	15.94		$	12.57		$	10.09		$	10.37		$	8.86


	0.06			0.01			(0.04	)		(0.05	)		(0.07	)
	3.08			3.36			2.52			(0.23	)		1.58
	3.14			3.37			2.48			(0.28	)		1.51

$	19.08		$	15.94		$	12.57		$	10.09		$	10.37

	19.70	%		26.81	%		24.58	%		(2.70	)%		17.04	%


$	25.54		$	26.23		$	37.11		$	2.53		$	3.12

	1.03	%		1.11	%		1.11	%		1.09	%		1.09	%
	0.98	%		0.98	%		9.98	%		0.98	%		0.98	%

	0.03	%		(0.01	)%		(0.51	)%		(0.55	)%		(0.64	)%
	0.08	%		0.12	%		(0.38	)%		(0.44	)%		(0.53	)%
	84	%		105	%		90	%		106	%		103	%

	$	2,080,428		10/31/16
	$	146,945,544		10/31/17

INVESTMENT INCOME:
Dividend income(1)	$	26,032,000
Interest income		16,249
Total investment income		26,048,249

EXPENSES:
Investment advisory fees (See Note 5)		13,038,408
Distribution fees – Investor Class (See Note 5)		2,996,786
Administration, fund accounting, custody and transfer agent fees		1,643,287
Sub-transfer agent expenses – Investor Class (See Note 5)		1,441,830
Sub-transfer agent expenses – Institutional Class (See Note 5)		155,050
Reports to shareholders		145,348
Federal and state registration fees		65,257
Compliance expense		21,488
Legal fees		20,972
Trustees’ fees and expenses		20,355
Audit fees		19,100
Other expenses		84,547
Total expenses		19,652,428
NET INVESTMENT INCOME	$	6,395,821

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	114,548,203
Net change in unrealized appreciation on investments		28,663,773
Net gain on investments		143,211,976
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	149,607,797

(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 fiscal year 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 reinstated 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.

	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 year ended October 31, 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 to cover the repurchase amount 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 tax returns of the Fund for the prior three fiscal years are open for examination. 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.

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 year ended October 31, 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 October 31, 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.

Cost of investments for tax purposes	$	868,981,979
Gross tax unrealized appreciation	$	643,041,600
Gross tax unrealized depreciation		(13,171,987	)
Net tax unrealized appreciation	$	629,869,613
Undistributed ordinary income	$	2,729,102
Undistributed long-term capital gains		110,571,214
Total distributable earnings	$	113,300,316
Other accumulated gain	$	—
Total accumulated gain	$	743,169,929

TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS

Take-Two Interactive Software, Inc.	3.61%
Centene Corp.	3.60%
UGI Corp.	3.45%
Advance Auto Parts, Inc.	3.42%
Live Nation Entertainment, Inc.	3.38%
Sealed Air Corp.	3.36%
NVR, Inc.	3.35%
Reinsurance Group of America, Inc.	3.33%
JetBlue Airways Corp.	3.33%
Steel Dynamics, Inc.	3.33%

COMMON STOCKS – 96.72%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 25.59%
Advance Auto Parts, Inc.		77,700	$	11,418,792		3.42	%
Brinker International, Inc.		197,700		10,604,628		3.18	%
Foot Locker, Inc.		187,300		10,490,673		3.15	%
JC Penney Co., Inc. (a)		1,106,300		8,418,943		2.52	%
Live Nation Entertainment, Inc. (a)		433,500		11,271,000		3.38	%
Mohawk Industries, Inc. (a)		77,700		11,036,508		3.31	%
NVR, Inc. (a)		9,114		11,188,164		3.35	%
Skechers USA, Inc. (a)		200,100		10,955,475		3.28	%
				85,384,183		25.59	%

Consumer Staples – 6.05%
Pilgrim’s Pride Corp. (a)		327,900		9,315,639		2.79	%
Pinnacle Foods, Inc.		321,300		10,859,940		3.26	%
				20,175,579		6.05	%

Financials – 6.48%
Reinsurance Group of America, Inc.		131,900		11,112,575		3.33	%
Voya Financial, Inc.		268,000		10,519,000		3.15	%
				21,631,575		6.48	%

Health Care – 13.04%
Centene Corp. (a)		129,500		12,000,765		3.60	%
Health Net, Inc. (a)		227,100		10,789,521		3.23	%
LifePoint Hospitals, Inc. (a)		151,020		10,571,400		3.17	%
Tenet Healthcare Corp. (a)		181,100		10,150,655		3.04	%
				43,512,341		13.04	%

Industrials – 15.84%
AECOM Technology Corp. (a)		323,200		10,520,160		3.15	%
HD Supply Holdings, Inc. (a)		382,500		11,031,300		3.30	%
JetBlue Airways Corp. (a)		962,500		11,107,250		3.33	%
Masco Corp.		444,000		9,799,080		2.94	%
Ryder System, Inc.		117,600		10,404,072		3.12	%
				52,861,862		15.84	%

Information Technology – 3.61%
Take-Two Interactive Software, Inc. (a)		456,000		12,061,200		3.61	%

ASSETS:
Investments in securities, at value (cost $311,854,575)	$	333,597,349
Dividends and interest receivable		14,638
Receivable for fund shares sold		855,567
Prepaid expenses and other assets		19,281
Total Assets		334,486,835

LIABILITIES:
Payable for fund shares redeemed		391,428
Payable to advisor		200,234
Payable to administrator		71,747
Payable to auditor		19,021
Accrued service fees		20,996
Accrued interest payable		703
Accrued trustees fees		2,538
Accrued expenses and other payables		82,706
Total Liabilities		789,373
NET ASSETS	$	333,697,462

NET ASSETS CONSIST OF:
Capital stock	$	293,354,818
Accumulated net investment loss		(1,033,484	)
Accumulated net realized gain on investments		19,633,354
Unrealized net appreciation on investments		21,742,774
Total Net Assets	$	333,697,462

NET ASSETS
Investor Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Investor Class shares	$	258,169,476
Shares issued and outstanding		13,591,296
Net asset value, offering price and redemption price per share	$	19.00

Institutional Class:
Shares authorized (no par value)	Unlimited
Net assets applicable to outstanding Institutional Class shares	$	75,527,986
Shares issued and outstanding		3,901,354
Net asset value, offering price and redemption price per share	$	19.36

INVESTMENT INCOME:
Dividend income	$	2,010,203
Interest income		1,040
Total investment income		2,011,243

EXPENSES:
Investment advisory fees (See Note 5)		1,912,346
Administration, fund accounting, custody and transfer agent fees		461,247
Sub-transfer agent expenses – Investor Class (See Note 5)		331,358
Sub-transfer agent expenses – Institutional Class (See Note 5)		57,226
Service fees – Investor Class (See Note 5)		194,841
Federal and state registration fees		46,793
Reports to shareholders		30,781
Compliance expense		21,487
Audit fees		19,054
Trustees’ fees and expenses		11,242
Legal fees		4,000
Interest expense (See Note 6)		152
Other expenses		19,959
Total expenses before waiver		3,110,486
Administrative expense waiver (See Note 5)		(55,360	)
Net expenses		3,055,126
NET INVESTMENT LOSS	$	(1,043,883	)

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	21,172,663
Net change in unrealized appreciation on investments		14,300,425
Net gain on investments		35,473,088
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	34,429,205

Year Ended October 31
2014			2013			2012			2011			2010

$	17.62		$	14.31		$	12.32		$	11.29		$	8.78


	(0.08	)		0.14			0.09			(0.05	)		0.02
	3.17			3.41			1.90			1.08			2.49
	3.09			3.55			1.99			1.03			2.51


	(0.09	)		(0.24	)		—			—			—
	(1.26	)		—			—			—			—
	(1.35	)		(0.24	)		—			—			—
$	19.36		$	17.62		$	14.31		$	12.32		$	11.29

	18.57	%		25.15	%		16.15	%		9.12	%		28.59	%


$	75.53		$	51.19		$	41.62		$	24.06		$	21.38

	1.07	%		1.11	%		1.16	%		1.14	%		1.16	%
	0.98	%		0.98	%		0.98	%		0.98	%		0.98	%

	(0.29	)%		0.71	%		0.90	%		(0.41	)%		(0.03	)%
	(0.20	)%		0.84	%		1.08	%		(0.57	)%		0.15	%
	132	%		212	%		25	%		107	%		87	%

	are open for examination. 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.

j).	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 fiscal year ended October 31, 2014, the Fund did not hold any derivative instruments.

k).	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 October 31, 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.

Cost of investments for tax purposes	$	311,856,869
Gross tax unrealized appreciation	$	23,763,582
Gross tax unrealized depreciation		(2,023,102	)
Net tax unrealized appreciation	$	21,740,480
Undistributed ordinary income	$	—
Undistributed long-term capital gains		20,622,992
Total distributable earnings	$	20,622,992
Other accumulated loss	$	(2,020,828	)
Total accumulated gain	$	40,342,644

COMMON STOCKS – 98.49%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 8.80%
Ford Motor Co.		187,100	$	2,636,239		1.69	%
General Motors Co.		77,200		2,424,080		1.56	%
McDonald’s Corp.		29,300		2,746,289		1.77	%
Target Corp.		49,100		3,035,362		1.95	%
Thomson Reuters Corp. (a)		76,600		2,851,052		1.83	%
				13,693,022		8.80	%

Consumer Staples – 24.16%
Altria Group, Inc.		79,800		3,857,532		2.48	%
ConAgra Foods, Inc.		88,700		3,046,845		1.96	%
General Mills, Inc.		58,100		3,018,876		1.94	%
Kellogg Co.		47,800		3,057,288		1.96	%
Kimberly Clark Corp.		25,800		2,948,166		1.89	%
Kraft Foods Group, Inc.		53,300		3,003,455		1.93	%
Pepsico, Inc.		34,700		3,337,099		2.14	%
Philip Morris International, Inc.		36,100		3,213,261		2.07	%
Procter & Gamble Co.		36,000		3,141,720		2.02	%
Sysco Corp.		78,900		3,040,806		1.95	%
The Coca-Cola Co.		73,200		3,065,616		1.97	%
Unilever PLC – ADR (a)		71,600		2,880,468		1.85	%
				37,611,132		24.16	%

Energy – 12.86%
BP PLC – ADR		59,000		2,564,140		1.65	%
Chevron Corp.		24,500		2,938,775		1.89	%
ConocoPhillips		42,600		3,073,590		1.97	%
Exxon Mobil Corp.		30,200		2,920,642		1.88	%
Occidental Petroleum Corp.		31,200		2,774,616		1.78	%
Royal Dutch Shell PLC – ADR (a)		38,100		2,844,927		1.83	%
Total SA – ADR (a)		48,400		2,898,676		1.86	%
				20,015,366		12.86	%

Financials – 3.78%
Banco Santander SA – ADR (a)		325,700		2,856,389		1.83	%
J.P. Morgan Chase & Co.		50,100		3,030,048		1.95	%
				5,886,437		3.78	%

SHORT-TERM INVESTMENTS – 1.38%	Number				% of
	of Shares		Value		Net Assets
Money Market Funds – 1.38%
Fidelity Government Portfolio – Institutional Class, 0.01% (b)		2,148,308	$	2,148,308		1.38	%

Total Short-Term Investments
(Cost $2,148,308)				2,148,308		1.38	%

Total Investments
(Cost $118,572,513) – 99.87%				155,478,899		99.87	%
Other Assets in
Excess of Liabilities – 0.13%				208,566		0.13	%
TOTAL NET ASSETS – 100.00%			$	155,687,465		100.00	%

INVESTMENT INCOME:
Dividend income(1)	$	5,066,911
Interest income		470
Total investment income		5,067,381

EXPENSES:
Investment advisory fees (See Note 5)		1,122,438
Administration, fund accounting, custody and transfer agent fees		272,463
Service fees – Investor Class (See Note 5)		142,812
Sub-transfer agent expenses – Investor Class (See Note 5)		94,494
Sub-transfer agent expenses – Institutional Class (See Note 5)		3,294
Federal and state registration fees		31,457
Audit fees		23,056
Compliance expense		21,488
Reports to shareholders		18,199
Trustees’ fees and expenses		9,694
Legal fees		2,501
Interest expense (See Note 6)		608
Other expenses		13,314
Total expenses before waiver		1,755,818
Administrative expense waiver (See Note 5)		(4,237	)
Net expenses		1,751,581
NET INVESTMENT INCOME	$	3,315,800

REALIZED AND UNREALIZED GAINS:
Net realized gain on investments	$	8,660,346
Net change in unrealized appreciation on investments		4,550,966
Net gain on investments		13,211,312
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	16,527,112

Cost of investments for tax purposes	$	118,984,864
Gross tax unrealized appreciation	$	38,089,071
Gross tax unrealized depreciation		(1,595,036	)
Net tax unrealized appreciation	$	36,494,035
Undistributed ordinary income	$	2,764,012
Undistributed long-term capital gains		—
Total distributable earnings	$	2,764,012
Other accumulated loss	$	(23,407,097	)
Total accumulated gain	$	15,850,950

TOP TEN HOLDINGS (EXCLUDING CASH/CASH EQUIVALENTS)	% NET ASSETS

Johnson & Johnson	3.80%
J.P. Morgan Chase & Co.	3.47%
Wells Fargo & Co.	3.36%
Exxon Mobil Corp.	3.35%
Pfizer, Inc.	3.20%
CVS Health Corp.	2.45%
Medtronic, Inc.	2.42%
CIGNA Corp.	2.32%
Citigroup, Inc.	2.28%
Kroger Co.	2.18%

COMMON STOCKS – 94.63%	Number				% of
	of Shares		Value		Net Assets
Consumer Discretionary – 7.02%
Comcast Corp.		30,445	$	1,685,131		1.11	%
Dish Network Corp. (a)		16,200		1,031,130		0.68	%
Ford Motor Co.		122,975		1,732,718		1.14	%
Lowes Companies, Inc.		21,920		1,253,824		0.83	%
Macy’s, Inc.		17,430		1,007,803		0.66	%
Target Corp.		19,070		1,178,907		0.78	%
The Walt Disney Co.		21,875		1,998,937		1.32	%
Viacom, Inc.		10,410		756,599		0.50	%
				10,645,049		7.02	%

Consumer Staples – 6.60%
CVS Health Corp.		43,305		3,716,002		2.45	%
Kraft Foods Group, Inc.		28,360		1,598,086		1.06	%
Kroger Co.		59,400		3,309,174		2.18	%
Procter & Gamble Co.		15,825		1,381,048		0.91	%
				10,004,310		6.60	%

Energy – 11.69%
Anadarko Petroleum Corp.		15,365		1,410,200		0.93	%
Chevron Corp.		14,835		1,779,458		1.17	%
ConocoPhillips		36,370		2,624,096		1.73	%
Exxon Mobil Corp.		52,580		5,085,012		3.35	%
Helmerich & Payne, Inc.		20,255		1,758,539		1.16	%
Marathon Oil Corp.		58,485		2,070,369		1.37	%
Valero Energy Corp.		21,905		1,097,221		0.73	%
Whiting Petroleum Corp. (a)		30,980		1,897,215		1.25	%
				17,722,110		11.69	%

Financials – 24.19%
Affiliated Managers Group, Inc. (a)		1,670		333,649		0.22	%
Allstate Corp.		44,585		2,891,337		1.91	%
American International Group, Inc.		35,965		1,926,645		1.27	%
BlackRock, Inc.		6,550		2,234,271		1.47	%
Capital One Financial Corp.		23,025		1,905,779		1.26	%
Citigroup, Inc.		64,705		3,463,659		2.28	%
E*TRADE Financial Corp. (a)		58,465		1,303,770		0.86	%
Hartford Financial Services Group, Inc.		53,240		2,107,239		1.39	%

SHORT-TERM INVESTMENTS – 0.64%	Number				% of
	of Shares		Value		Net Assets
Money Market Funds – 0.64%
Fidelity Government Portfolio –
Institutional Class, 0.01% (c)		975,014	$	975,014		0.64	%

Total Short-Term Investments
(Cost $975,014)				975,014		0.64	%

Total Investments
(Cost $119,878,919) – 99.58%				151,003,320		99.58	%
Other Assets in Excess
of Liabilities – 0.42%				643,930		0.42	%
TOTAL NET ASSETS – 100.00%			$	151,647,250		100.00	%

INVESTMENT INCOME:
Dividend income	$	3,085,725
Interest income		133
Total investment income		3,085,858

EXPENSES:
Investment advisory fees (See Note 5)		1,260,210
Administration, fund accounting, custody and transfer agent fees		267,109
Service fees – Investor Class (See Note 5)		147,913
Sub-transfer agent expenses – Investor Class (See Note 5)		100,248
Sub-transfer agent expenses – Institutional Class (See Note 5)		226
Federal and state registration fees		31,048
Audit fees		22,057
Compliance expense		21,488
Reports to shareholders		19,199
Trustees’ fees and expenses		10,397
Legal fees		3,001
Other expenses		14,288
Total expenses before waiver		1,897,184
Reimbursement by Advisor (See Note 5)		(9	)
Administrative expense waiver (See Note 5)		(677	)
Total waiver		(686	)
Net expenses		1,896,498
NET INVESTMENT INCOME	$	1,189,360

REALIZED AND UNREALIZED GAINS (LOSSES):
Net realized gain on investments	$	18,120,591
Net change in unrealized appreciation on investments		384,704
Net gain on investments		18,505,295
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	19,694,655