UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-01209
Bridges Investment Fund, Inc.
(Exact name of registrant as specified in charter)
8401 West Dodge Road, Suite 256
Omaha, NE 68114
(Address of principal executive offices) (Zip code)
Edson A. Bridges III
8401 West Dodge Road, Suite 256
Omaha, NE 68114
(Name and address of agent for service)
(402) 397-4700
Registrant's telephone number, including area code
Date of fiscal year end: December 31, 2012
Date of reporting period: June 30, 2012
Item 1. Reports to Stockholders.
Semi-Annual
Shareholder Report
2012
8401 West Dodge Road - 256 Durham Plaza - Omaha, Nebraska 68114 - voice: (402) 397-4700 fax: (402) 397-8617 - www.bridgesfund.com
This page has been intentionally left blank.
Contents of Report
| Page 1 | Shareholder Letter |
| | |
| Exhibit 1 | Portfolio Transactions During the Period From January 1, 2012 |
| Pages 2 – 3 | through June 30, 2012 |
| | |
| Exhibit 2 | Selected Historical Financial Information |
| Pages 4 – 5 | |
| | |
| Page 6 | Expense Example |
| | |
| Page 7 | Allocation of Portfolio Holdings |
| | |
| Pages 8 – 20 | Financial Statements |
| | |
| Pages 21 – 25 | Additional Disclosures |
IMPORTANT NOTICES
Opinions expressed are those of Edson L. Bridges III and are subject to change. They are not guarantees and should not be considered investment advice.
The S&P 500 Index is a broadly based unmanaged composite of 500 stocks which is widely recognized as representative of price changes for the U.S. equity market in general. The Russell 1000 Growth Index is an unmanaged composite of stocks that measures the performance of the stocks of companies with higher price-to-book ratios and higher forecasted growth values from a universe of the 1,000 largest U.S. companies based on total market capitalization.
You cannot invest directly in a specific index.
Earnings per share is calculated by taking the total earnings divided by the number of shares outstanding.
P/E is a valuation ratio of a company’s current share price compared to its per-share earnings.
Consensus earnings growth is the current consensus of Wall Street analysts’ forecasts for future earnings growth for the S&P 500 Index.
Fund holdings are subject to change and should not be considered a recommendation to buy or sell any security. Please refer to the Schedule of Investments for complete information on holdings in the Fund.
This report must be preceded or accompanied by a Prospectus.
Mutual fund investing involves risk. Principal loss is possible. Small- and medium capitalization companies tend to have limited liquidity and greater price volatility than large-capitalization companies. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. The Fund invests in foreign securities which involve political, economic and currency risks, greater volatility and differences in accounting methods.
The Bridges Investment Fund is distributed by Quasar Distributors, LLC.
Bridges Investment Fund, Inc.
256 DURHAM PLAZA
8401 WEST DODGE ROAD
OMAHA, NEBRASKA 68114 - 3453
TELEPHONE 402 - 397 - 4700
FACSIMILE 402 - 397 - 8617
July 11, 2012
Dear Shareholder:
Bridges Investment Fund had a total return of -5.50% in the second quarter of 2012, which lagged the -2.75% total return for the S&P 500 and the -4.02% total return for the Russell 1000 Growth Index over the same period. For the twelve month period ended June 30, 2012, the Fund had a total return of 5.43% versus 5.45% for the S&P 500 and 5.76% for the Russell 1000 Growth Index. For the three year period ended June 30, 2012, the Fund had an average annual total return of 13.66% versus 16.40% for the S&P 500 and 17.50% for the Russell 1000 Growth Index. For the five year period ended June 30, 2012, the Fund had an average annual total return of 1.28% versus 0.22% for the S&P 500 and 2.87% for the Russell 1000 Growth Index. For the ten year period ended June 30, 2012, the Fund had an average annual total return of 4.83% versus 5.33% for the S&P 500 and 6.03% for the Russell 1000 Growth Index. The Fund’s expense ratio is 0.89%.
Performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and the 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 stated above. Performance data current to the most recent month end may be obtained by calling 866-934-4700.
During the second quarter, we sold BHP Billiton and Rackspace Hosting, and trimmed Amazon.
We also added to our positions in Accenture, Baidu, Celgene, Cognizant Technology, eBay, McDonalds, Priceline, and Qualcomm; while BlackRock was a new position.
After a strong first quarter, stocks declined in the second quarter due to investor concerns about European sovereign debt defaults and a slowing in the pace of the U.S. economic recovery. Investors scrambled to reduce risk by selling relatively more economically sensitive stocks and increasing exposure to bonds. The S&P 500 reached a high of 1422 early in April, bottomed at 1266 on June 4, and finished the quarter at 1362, up from 1257 at year end.
We believe equities remain attractively valued. The S&P 500 currently trades at about 13.0x estimated 2012 earnings of $104 per share, and 11.6x estimated 2013 earnings of $117 per share, versus long term historic P/E multiples of 15-16x.
We believe the Fund’s portfolio holdings are also attractively valued. The Fund’s portfolio ended the second quarter trading at 13.8x estimated 2012 earnings and 12.0x estimated 2013 earnings. The Fund’s companies are estimated to grow their earnings at 12-13% annually over the next three to five years, versus consensus earnings growth of 5-7% for the S&P 500.
We expect continued equity market volatility during the second half of 2012, but we remain constructive on the outlook for the Fund’s portfolio.
| Sincerely, |
| |
| Edson L. Bridges III, CFA |
| President and Chief Executive Officer |
Exhibit 1
BRIDGES INVESTMENT FUND, INC.
PORTFOLIO TRANSACTIONS
DURING THE PERIOD FROM
JANUARY 1, 2012 THROUGH JUNE 30, 2012
Unaudited
| | Bought or | | | Held After | |
Securities | | Received | | | Transactions | |
Common Stock Unless | | $1,000 Par | | | $1,000 Par | |
Described Otherwise | | Value (M) | | | Value (M) | |
| | or Shares | | | or Shares | |
| | | | | | |
Accenture PLC | | | 3,000 | | | | 18,000 | |
Baidu, Inc. – ADR | | | 5,000 | | | | 5,000 | |
BlackRock, Inc. | | | 2,500 | | | | 2,500 | |
Celgene Corporation | | | 12,000 | | | | 12,000 | |
Cognizant Technology Solutions Corporation | | | 5,000 | | | | 15,000 | |
DIRECTV – Class A | | | 5,000 | | | | 30,000 | |
The Walt Disney Co. | | | 20,000 | | | | 20,000 | |
EMC Corp. | | | 10,000 | | | | 65,000 | |
eBay, Inc. | | | 5,000 | | | | 20,000 | |
General Electric Co. | | | 5,000 | | | | 60,000 | |
MSCI Emerging Markets Index Fund | | | 20,000 | | | | 20,000 | |
Johnson Controls, Inc. | | | 15,000 | | | | 15,000 | |
McDonald’s Corp. | | | 4,000 | | | | 17,000 | |
Microsoft Corp. | | | 30,000 | | | | 30,000 | |
Priceline.com, Inc. | | | 500 | | | | 2,500 | |
QUALCOMM, Inc. | | | 7,000 | | | | 47,000 | |
Schlumberger Ltd. | | | 6,000 | | | | 22,000 | |
Tiffany & Co. | | | 2,000 | | | | 12,000 | |
Watson Pharmaceuticals, Inc. | | | 7,000 | | | | 7,000 | |
Exhibit 1
(Continued)
BRIDGES INVESTMENT FUND, INC.
PORTFOLIO TRANSACTIONS
DURING THE PERIOD FROM
JANUARY 1, 2012 THROUGH JUNE 30, 2012
(Unaudited)
| | | Sold or | | | Held After | |
| Securities | | Exchanged | | | Transactions | |
| Common Stock Unless | | $1,000 Par | | | $1,000 Par | |
| Described Otherwise | | Value (M) | | | Value (M) | |
| | | or Shares | | | or Shares | |
| | | | | | | |
| Allergan, Inc. | | | 5,000 | | | | 10,000 | |
| Amazon.com, Inc. | | | 1,000 | | | | 3,500 | |
| Anadarko Petroleum Corp. | | | 4,000 | | | | 20,000 | |
| Apple Inc. | | | 1,000 | | | | 11,000 | |
| BHP Billiton Ltd. – ADR | | | 15,000 | | | | — | |
| Carnival Corporation | | | 30,000 | | | | — | |
| Eaton Corporation | | | 10,000 | | | | 40,000 | |
| Emerson Electric Co. | | | 20,000 | | | | — | |
| Google, Inc. | | | 500 | | | | 4,000 | |
| Mastercard, Inc. | | | 300 | | | | 10,700 | |
1 | MBNA Corp. | | | | | | | | |
| 7.50 % due 3/15/2012 | | | 250,000 | | | | — | |
| McDonalds Corporation | | | 2,000 | | | | 13,000 | |
| Perrigo Company | | | 6,000 | | | | 6,000 | |
| Praxair, Inc. | | | 1,000 | | | | 7,000 | |
| Rackspace Hosting, Inc. | | | 20,000 | | | | — | |
2 | Reynolds American Inc. Sr. Secured Notes | | | | | | | | |
| 7.25% due 06/01/12 | | | 250,000 | | | | — | |
| Roper Industries, Inc. | | | 3,000 | | | | 12,000 | |
| Schlumberger, Ltd. | | | 2,000 | | | | 20,000 | |
| Target Corporation | | | 20,000 | | | | — | |
| Visa Inc. Class A | | | 2,000 | | | | 13,000 | |
| Watson Pharmaceuticals, Inc. | | | 7,000 | | | | — | |
| | | | | | | | | |
1 | Matured at Par on 3/15/2012 |
2 | Matured at Par on 6/01/2012 |
Exhibit 2
BRIDGES INVESTMENT FUND, INC.
SELECTED HISTORICAL FINANCIAL INFORMATION
(Unaudited)
– – – – – – – – – – – Year End Statistics – – – – – – – – – – –
Valuation | | | Net | | Shares | | Net Asset | | Dividend/ | | Capital |
Date | | | Assets | | Outstanding | | Value/Share | | Share | | Gains/Share |
| 07-01-63 | | | $ | 109,000 | | | | 10,900 | | | $ | 10.00 | | | $ | — | | | $ | — | |
| 12-31-63 | | | | 159,187 | | | | 15,510 | | | | 10.13 | | | | .07 | | | | — | |
| 12-31-64 | | | | 369,149 | | | | 33,643 | | | | 10.97 | | | | .28 | | | | — | |
| 12-31-65 | | | | 621,241 | | | | 51,607 | | | | 12.04 | | | | .285 | | | | .028 | |
| 12-31-66 | | | | 651,282 | | | | 59,365 | | | | 10.97 | | | | .295 | | | | — | |
| 12-31-67 | | | | 850,119 | | | | 64,427 | | | | 13.20 | | | | .295 | | | | — | |
| 12-31-68 | | | | 1,103,734 | | | | 74,502 | | | | 14.81 | | | | .315 | | | | — | |
| 12-31-69 | | | | 1,085,186 | | | | 84,807 | | | | 12.80 | | | | .36 | | | | — | |
| 12-31-70 | | | | 1,054,162 | | | | 90,941 | | | | 11.59 | | | | .37 | | | | — | |
| 12-31-71 | | | | 1,236,601 | | | | 93,285 | | | | 13.26 | | | | .37 | | | | — | |
| 12-31-72 | | | | 1,272,570 | | | | 93,673 | | | | 13.59 | | | | .35 | | | | .08 | |
| 12-31-73 | | | | 1,025,521 | | | | 100,282 | | | | 10.23 | | | | .34 | | | | .07 | |
| 12-31-74 | | | | 757,545 | | | | 106,909 | | | | 7.09 | | | | .35 | | | | — | |
| 12-31-75 | | | | 1,056,439 | | | | 111,619 | | | | 9.46 | | | | .35 | | | | — | |
| 12-31-76 | | | | 1,402,661 | | | | 124,264 | | | | 11.29 | | | | .38 | | | | — | |
| 12-31-77 | | | | 1,505,147 | | | | 145,252 | | | | 10.36 | | | | .428 | | | | .862 | |
| 12-31-78 | | | | 1,574,097 | | | | 153,728 | | | | 10.24 | | | | .481 | | | | .049 | |
| 12-31-79 | | | | 1,872,059 | | | | 165,806 | | | | 11.29 | | | | .474 | | | | .051 | |
| 12-31-80 | | | | 2,416,997 | | | | 177,025 | | | | 13.65 | | | | .55 | | | | .0525 | |
| 12-31-81 | | | | 2,315,441 | | | | 185,009 | | | | 12.52 | | | | .63 | | | | .0868 | |
| 12-31-82 | | | | 2,593,411 | | | | 195,469 | | | | 13.27 | | | | .78 | | | | .19123 | |
| 12-31-83 | | | | 3,345,988 | | | | 229,238 | | | | 14.60 | | | | .85 | | | | .25 | |
| 12-31-84 | | | | 3,727,899 | | | | 278,241 | | | | 13.40 | | | | .80 | | | | .50 | |
| 12-31-85 | | | | 4,962,325 | | | | 318,589 | | | | 15.58 | | | | .70 | | | | .68 | |
| 12-31-86 | | | | 6,701,786 | | | | 407,265 | | | | 16.46 | | | | .688 | | | | .86227 | |
| 12-31-87 | | | | 7,876,275 | | | | 525,238 | | | | 15.00 | | | | .656 | | | | 1.03960 | |
| 12-31-88 | | | | 8,592,807 | | | | 610,504 | | | | 14.07 | | | | .85 | | | | 1.10967 | |
| 12-31-89 | | | | 10,895,182 | | | | 682,321 | | | | 15.97 | | | | .67 | | | | .53769 | |
| 12-31-90 | | | | 11,283,448 | | | | 744,734 | | | | 15.15 | | | | .67 | | | | .40297 | |
| 12-31-91 | | | | 14,374,679 | | | | 831,027 | | | | 17.30 | | | | .66 | | | | .29292 | |
| 12-31-92 | | | | 17,006,789 | | | | 971,502 | | | | 17.51 | | | | .635 | | | | .15944 | |
| 12-31-93 | | | | 17,990,556 | | | | 1,010,692 | | | | 17.80 | | | | .6225 | | | | .17075 | |
| 12-31-94 | | | | 18,096,297 | | | | 1,058,427 | | | | 17.10 | | | | .59 | | | | .17874 | |
| 12-31-95 | | | | 24,052,746 | | | | 1,116,620 | | | | 21.54 | | | | .575 | | | | .19289 | |
| 12-31-96 | | | | 29,249,488 | | | | 1,190,831 | | | | 24.56 | | | | .55 | | | | .25730 | |
| 12-31-97 | | | | 36,647,535 | | | | 1,262,818 | | | | 29.02 | | | | .5075 | | | | .30571 | |
| 12-31-98 | | | | 48,433,113 | | | | 1,413,731 | | | | 34.26 | | | | .44 | | | | 2.11648 | |
| 12-31-99 | | | | 69,735,684 | | | | 1,508,154 | | | | 46.24 | | | | .30 | | | | .91088 | |
| 12-31-00 | | | | 71,411,520 | | | | 1,850,301 | | | | 38.59 | | | | .40 | | | | .80880716 | |
| 12-31-01 | | | | 60,244,912 | | | | 1,940,494 | | | | 31.05 | | | | .26 | | | | — | |
| 12-31-02 | | | | 45,854,541 | | | | 1,989,769 | | | | 23.05 | | | | .20 | | | | — | |
| 12-31-03 | | | | 62,586,435 | | | | 2,016,560 | | | | 31.04 | | | | .24 | | | | — | |
| 12-31-04 | | | | 74,281,648 | | | | 2,230,038 | | | | 33.31 | | | | .305 | | | | — | |
| 12-31-05 | | | | 80,715,484 | | | | 2,305,765 | | | | 35.01 | | | | .2798 | | | | — | |
| 12-31-06 | | | | 82,754,479 | | | | 2,336,366 | | | | 35.42 | | | | .2695 | | | | — | |
| 12-31-07 | | | | 77,416,617 | | | | 2,258,380 | | | | 34.28 | | | | .2364 | | | | 2.5735 | |
| 12-31-08 | | | | 49,448,417 | | | | 2,257,410 | | | | 21.91 | | | | .2603 | | | | — | |
| 12-31-09 | | | | 67,435,343 | | | | 2,303,377 | | | | 29.28 | | | | .17 | | | | — | |
| 12-31-10 | | | | 75,014,486 | | | | 2,307,301 | | | | 32.51 | | | | .126 | | | | — | |
| 12-31-11 | | | | 73,779,028 | | | | 2,266,478 | | | | 32.55 | | | | .1586 | | | | — | |
Exhibit 2
(Continued)
BRIDGES INVESTMENT FUND, INC.
SELECTED HISTORICAL FINANCIAL INFORMATION
(Unaudited)
– – – – – – – – – – – Current Six Months Compared to Same Six Months in Prior Year – – – – – – – – – – –
Valuation | | | Net | | Shares | | Net Asset | | Dividend/ | | Capital |
Date | | | Assets | | Outstanding | | Value/Share | Share | | Gains/Share |
| 06-30-11 | | | $ | 77,853,396 | | | | 2,310,574 | | | $ | 33.69 | | | $ | .06 | | | $ | — | |
| 06-30-12 | | | | 79,224,905 | | | | 2,242,474 | | | | 35.33 | | | | .08 | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
BRIDGES INVESTMENT FUND, INC.
EXPENSE EXAMPLE
JUNE 30, 2012
(Unaudited)
As a shareholder of The Bridges Investment Fund, Inc., you incur ongoing costs, including management fees; services 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 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 the entire period (January 1, 2012 – June 30, 2012).
ACTUAL EXPENSES
The first line of the table below provides information about actual account values and actual expenses. Although the Fund charges no sales load or transactions fees, you will be assessed fees for outgoing wire transfers, returned checks or stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent. If you request a redemption be made by wire transfer, currently a $15.00 fee is charged by the Fund’s transfer agent. To the extent that the Fund invests in shares of other investment companies as part of its investment strategy, you will indirectly bear your proportionate share of any fees and expenses charged by the underlying funds in which a Fund invests in addition to the expenses of the Fund. Actual expenses of the underlying funds are expected to vary among the various underlying funds. These expenses are not included in the example below. The example 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, interest expense or dividends on short positions taken by the Fund 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 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), redemption fees, 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 costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| | | Expenses Paid |
| Beginning | Ending | During Period* |
| Account Value | Account Value | January 1, 2012 – |
| January 1, 2012 | June 30, 2012 | June 30, 2012 |
Actual | $1,000.00 | $1,087.80 | $4.47 |
Hypothetical (5% return before expenses) | 1,000.00 | 1,020.58 | 4.33 |
* | Expenses are equal to the Fund’s annualized expense ratio of 0.86%, multiplied by the average account value over the period, multiplied by 182/366 to reflect the one-half year period. |
BRIDGES INVESTMENT FUND, INC.
ALLOCATION OF PORTFOLIO HOLDINGS
JUNE 30, 2012
(Unaudited)
COMPONENTS OF PORTFOLIO HOLDINGS
Common Stock | | $ | 70,455,552 | |
Corporate Bonds | | | 1,709,976 | |
Exchange Traded Funds | | | 5,805,800 | |
Short Term Investments | | | 1,321,071 | |
Total | | $ | 79,292,399 | |
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF INVESTMENTS
JUNE 30, 2012
(Unaudited)
Title of Security | | Shares | | | Cost | | | Value | |
| | | | | | | | | |
COMMON STOCKS – 88.92% | | | | | | | | | |
| | | | | | | | | |
Amusement, Gambling, and Recreation Industries – 1.22% | | | | | | | | | |
The Walt Disney Co. | | | 20,000 | | | $ | 803,830 | | | $ | 970,000 | |
| | | | | | | | | | | | |
Beverage and Tobacco Product Manufacturing – 4.63% | | | | | | | | | | | | |
Altria Group, Inc. | | | 25,000 | | | $ | 478,400 | | | $ | 863,750 | |
PepsiCo, Inc. | | | 15,000 | | | | 657,954 | | | | 1,059,900 | |
Philip Morris International, Inc. | | | 20,000 | | | | 685,363 | | | | 1,745,200 | |
| | | | | | $ | 1,821,717 | | | $ | 3,668,850 | |
Chemical Manufacturing – 3.02% | | | | | | | | | | | | |
Allergan, Inc. | | | 10,000 | | | $ | 412,855 | | | $ | 925,700 | |
Perrigo Co. | | | 6,000 | | | | 460,237 | | | | 707,580 | |
Praxair, Inc. | | | 7,000 | | | | 663,592 | | | | 761,110 | |
| | | | | | $ | 1,536,684 | | | $ | 2,394,390 | |
Clothing and Clothing Accessories Stores – 0.80% | | | | | | | | | | | | |
Tiffany & Co. | | | 12,000 | | | $ | 800,941 | | | $ | 635,400 | |
| | | | | | | | | | | | |
Computer and Electronic Product Manufacturing – 15.46% | | | | | | | | | | | | |
Apple, Inc. (a) | | | 11,000 | | | | 1,283,012 | | | | 6,424,000 | |
EMC Corp. (a) | | | 65,000 | | | | 1,595,462 | | | | 1,665,950 | |
QUALCOMM, Inc. | | | 47,000 | | | | 1,985,832 | | | | 2,616,960 | |
VeriFone Systems, Inc. (a) | | | 25,000 | | | | 1,003,604 | | | | 827,250 | |
Waters Corp. (a) | | | 9,000 | | | | 472,047 | | | | 715,230 | |
| | | | | | $ | 6,339,957 | | | $ | 12,249,390 | |
Couriers and Messengers – 2.15% | | | | | | | | | | | | |
FedEx Corp. | | | 10,000 | | | $ | 688,396 | | | $ | 916,100 | |
United Parcel Service, Inc. | | | 10,000 | | | | 671,348 | | | | 787,600 | |
| | | | | | $ | 1,359,744 | | | $ | 1,703,700 | |
Credit Intermediation and Related Activities – 5.98% | | | | | | | | | | | | |
Capital One Financial Corp. | | | 50,000 | | | $ | 1,579,084 | | | $ | 2,733,000 | |
Wells Fargo & Co. | | | 60,000 | | | | 1,444,348 | | | | 2,006,400 | |
| | | | | | $ | 3,023,432 | | | $ | 4,739,400 | |
Food Services and Drinking Places – 2.91% | | | | | | | | | | | | |
McDonald’s Corp. | | | 17,000 | | | $ | 1,254,746 | | | $ | 1,505,010 | |
Starbucks Corp. | | | 15,000 | | | | 561,001 | | | | 799,800 | |
| | | | | | $ | 1,815,747 | | | $ | 2,304,810 | |
Health and Personal Care Stores – 2.96% | | | | | | | | | | | | |
Express Scripts Holding Co. (a) | | | 42,000 | | | $ | 850,873 | | | $ | 2,344,860 | |
Heavy and Civil Engineering Construction – 1.44% | | | | | | | | | | | | |
Chicago Bridge & Iron Co. | | | 30,000 | | | $ | 1,025,126 | | | $ | 1,138,800 | |
See accompanying Notes to the Financial Statements.
Percentages are stated as a percent of the value of net assets
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF INVESTMENTS
(Continued)
JUNE 30, 2012
(Unaudited)
Title of Security | | Shares | | | Cost | | | Value | |
| | | | | | | | | |
COMMON STOCKS (Continued) | | | | | | | | | |
| | | | | | | | | |
Insurance Carriers and Related Activities – 2.10% | | | | | | | | | |
Berkshire Hathaway, Inc. – Class B (a) | | | 20,000 | | | $ | 678,649 | | | $ | 1,666,600 | |
| | | | | | | | | | | | |
Leather and Allied Product Manufacturing – 0.55% | | | | | | | | | | | | |
NIKE, Inc. | | | 5,000 | | | $ | 424,432 | | | $ | 438,900 | |
| | | | | | | | | | | | |
Machinery Manufacturing – 5.54% | | | | | | | | | | | | |
Caterpillar, Inc. | | | 23,000 | | | $ | 1,379,092 | | | $ | 1,952,930 | |
General Electric Co. | | | 60,000 | | | | 793,288 | | | | 1,250,400 | |
Roper Industries, Inc. | | | 12,000 | | | | 547,802 | | | | 1,182,960 | |
| | | | | | $ | 2,720,182 | | | $ | 4,386,290 | |
Nonstore Retailers – 2.07% | | | | | | | | | | | | |
Amazon.com, Inc. (a) | | | 3,500 | | | $ | 565,147 | | | $ | 799,225 | |
eBay, Inc. (a) | | | 20,000 | | | | 656,836 | | | | 840,200 | |
| | | | | | $ | 1,221,983 | | | $ | 1,639,425 | |
Oil and Gas Extraction – 5.30% | | | | | | | | | | | | |
Anadarko Petroleum Corp. | | | 20,000 | | | $ | 1,335,558 | | | $ | 1,324,000 | |
Apache Corp. | | | 20,000 | | | | 1,502,797 | | | | 1,757,800 | |
Chesapeake Energy Corp. | | | 60,000 | | | | 1,649,239 | | | | 1,116,000 | |
| | | | | | $ | 4,487,594 | | | $ | 4,197,800 | |
Other Information Services – 3.65% | | | | | | | | | | | | |
Baidu, Inc. – ADR (a) | | | 5,000 | | | $ | 652,990 | | | $ | 574,900 | |
Google, Inc. (a) | | | 4,000 | | | | 1,691,412 | | | | 2,320,280 | |
| | | | | | $ | 2,344,402 | | | $ | 2,895,180 | |
Petroleum and Coal Products Manufacturing – 3.06% | | | | | | | | | | | | |
Chevron Corp. | | | 23,000 | | | $ | 1,061,445 | | | $ | 2,426,500 | |
| | | | | | | | | | | | |
Professional, Scientific, and Technical Services – 13.41% | | | | | | | | | | | | |
Accenture PLC | | | 18,000 | | | $ | 985,930 | | | $ | 1,081,620 | |
Celgene Corp. (a) | | | 12,000 | | | | 890,590 | | | | 769,920 | |
Cognizant Technology Solutions Corp. (a) | | | 15,000 | | | | 1,009,689 | | | | 900,000 | |
Mastercard, Inc. | | | 10,700 | | | | 1,866,465 | | | | 4,602,177 | |
Priceline.com, Inc. (a) | | | 2,500 | | | | 1,226,773 | | | | 1,661,300 | |
Visa, Inc. | | | 13,000 | | | | 939,190 | | | | 1,607,190 | |
| | | | | | $ | 6,918,637 | | | $ | 10,622,207 | |
Publishing Industries (except Internet) – 1.16% | | | | | | | | | | | | |
Microsoft Corp. | | | 30,000 | | | $ | 921,971 | | | $ | 917,700 | |
| | | | | | | | | | | | |
Rail Transportation – 3.76% | | | | | | | | | | | | |
Union Pacific Corp. | | | 25,000 | | | $ | 1,460,063 | | | $ | 2,982,750 | |
| | | | | | | | | | | | |
See accompanying Notes to the Financial Statements.
Percentages are stated as a percent of the value of net assets
ADRAmerican Depository Receipt
(a)Non Income Producing.
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF INVESTMENTS
(Continued)
JUNE 30, 2012
(Unaudited)
Title of Security | | Shares | | | Cost | | | Value | |
COMMON STOCKS (Continued) | | | | | | | | | |
| | | | | | | | | |
Securities, Commodity Contracts, and Other Financial | | | | | | | | | |
Investments and Related Activities – 1.73% | | | | | | | | | |
Blackrock, Inc. | | | 2,500 | | | $ | 447,102 | | | $ | 424,550 | |
T. Rowe Price Group, Inc. | | | 15,000 | | | | 725,747 | | | | 944,400 | |
| | | | | | $ | 1,172,849 | | | $ | 1,368,950 | |
Support Activities for Mining – 1.64% | | | | | | | | | | | | |
Schlumberger Ltd. | | | 20,000 | | | $ | 1,613,272 | | | $ | 1,298,200 | |
| | | | | | | | | | | | |
Telecommunications – 1.85% | | | | | | | | | | | | |
DIRECTV (a) | | | 30,000 | | | $ | 1,126,172 | | | $ | 1,464,600 | |
| | | | | | | | | | | | |
Transportation Equipment Manufacturing – 2.53% | | | | | | | | | | | | |
Eaton Corp. | | | 40,000 | | | $ | 1,806,537 | | | $ | 1,585,200 | |
Johnson Controls, Inc. | | | 15,000 | | | | 472,950 | | | | 415,650 | |
| | | | | | $ | 2,279,487 | | | $ | 2,000,850 | |
| | | | | | | | | | | | |
TOTAL COMMON STOCKS (Cost $47,809,189) | | | | | | $ | 47,809,189 | | | $ | 70,455,552 | |
| | | | | | | | | | | | |
EXCHANGE TRADED FUNDS – 7.33% | | | | | | | | | | | | |
| | | | | | | | | | | | |
Funds, Trusts, and Other Financial Vehicles – 7.33% | | | | | | | | | | | | |
iShares MSCI Emerging Markets Index Fund | | $ | 20,000 | | | $ | 827,798 | | | $ | 783,800 | |
iShares S&P MidCap 400 Index Fund | | $ | 30,000 | | | | 2,641,547 | | | | 2,823,900 | |
iShares S&P SmallCap 600 Index Fund | | $ | 30,000 | | | | 2,002,666 | | | | 2,198,100 | |
| | | | | | | | | | | | |
TOTAL EXCHANGE TRADED FUNDS (Cost $5,472,011) | | | | | | $ | 5,472,011 | | | $ | 5,805,800 | |
| | | | | | | | | | | | |
| | Principal | | | | | | | | | |
| | Amount | | | | | | | |
CORPORATE BONDS – 2.16% | | | | | | | | | | | | |
Broadcasting (except Internet) – 0.30% | | | | | | | | | | | | |
Comcast Corp. | | | | | | | | | | | | |
6.500%, 01/15/2017 | | $ | 200,000 | | | $ | 199,592 | | | $ | 238,094 | |
| | | | | | | | | | | | |
Building Material and Garden Equipment and Supplies Dealers – 0.29% | | | | | | | | | | | | |
Home Depot, Inc. | | | | | | | | | | | | |
5.400%, 03/01/2016 | | $ | 200,000 | | | $ | 188,563 | | | $ | 230,565 | |
| | | | | | | | | | | | |
Funds, Trusts, and Other Financial Vehicles – 0.40% | | | | | | | | | | | | |
Spectra Energy Capital, LLC | | | | | | | | | | | | |
8.000%, 10/01/2019 | | $ | 250,000 | | | $ | 265,931 | | | $ | 320,264 | |
| | | | | | | | | | | | |
General Merchandise Stores – 0.43% | | | | | | | | | | | | |
JC Penney Corp., Inc. | | | | | | | | | | | | |
7.400%, 04/01/2037 | | $ | 400,000 | | | $ | 400,898 | | | $ | 335,001 | |
See accompanying Notes to the Financial Statements.
Percentages are stated as a percent of the value of net assets
BRIDGES INVESTMENT FUND, INC.
SCHEDULE OF INVESTMENTS
(Concluded)
JUNE 30, 2012
(Unaudited)
| | Principal | | | | | | | |
Title of Security | | Amount | | | Cost | | | Value | |
| | | | | | | | | |
CORPORATE BONDS (Continued) | | | | | | | | | |
| | | | | | | | | |
Machinery Manufacturing – 0.39% | | | | | | | | | |
Applied Materials, Inc. | | | | | | | | | |
7.125%, 10/15/2017 | | $ | 250,000 | | | $ | 253,019 | | | $ | 311,716 | |
| | | | | | | | | | | | |
Oil and Gas Extraction – 0.35% | | | | | | | | | | | | |
Anadarko Petroleum Corp. | | | | | | | | | | | | |
7.625%, 03/15/2014 | | $ | 250,000 | | | $ | 245,249 | | | $ | 274,336 | |
| | | | | | | | | | | | |
TOTAL CORPORATE BONDS (Cost $1,553,252) | | | | | | $ | 1,553,252 | | | $ | 1,709,976 | |
| | | | | | | | | | | | |
| | Shares | | | Cost | | | Value | |
SHORT-TERM INVESTMENTS – 1.67% | | | | | | | | | | | | |
| | | | | | | | | | | | |
Mtual Fund – 1.67% | | | | | | | | | | | | |
SEI Daily Income Trust Treasury Fund, 0.010% | | | 1,321,071 | | | $ | 1,321,071 | | | $ | 1,321,071 | |
| | | | | | | | | | | | |
TOTAL SHORT-TERM INVESTMENTS (Cost $1,321,071) | | | | | | $ | 1,321,071 | | | $ | 1,321,071 | |
| | | | | | | | | | | | |
TOTAL INVESTMENTS – 100.08% | | | | | | $ | 56,155,523 | | | $ | 79,292,399 | |
LIABILITIES IN EXCESS OF OTHER ASSETS – (0.08)% | | | | | | | | | | | (67,494 | ) |
TOTAL NET ASSETS – 100.00% | | | | | | | | | | $ | 79,224,905 | |
See accompanying Notes to the Financial Statements.
Percentages are stated as a percent of the value of net assets
BRIDGES INVESTMENT FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2012
(Unaudited)
ASSETS: | | | |
Investments in securities, at fair value (cost: $56,155,523) | | $ | 79,292,399 | |
Receivables | | | | |
Dividends and interest | | | 98,970 | |
Fund shares issued | | | 20 | |
Prepaid Expenses | | | 10,782 | |
| | | | |
TOTAL ASSETS | | $ | 79,402,171 | |
| | | | |
LIABILITIES: | | | | |
Payables | | | | |
Advisory fees | | $ | 95,219 | |
Distribution to shareholders | | | 10,608 | |
Payable to directors | | | 13,743 | |
Withholding tax payable | | | 225 | |
Accrued expenses | | | 57,471 | |
| | | | |
TOTAL LIABILITIES: | | $ | 177,266 | |
| | | | |
TOTAL NET ASSETS | | $ | 79,224,905 | |
| | | | |
NET ASSETS CONSIST OF: | | | | |
Capital stock | | $ | 55,271,498 | |
Accumulated undistributed net investment income | | | 10,595 | |
Accumulated undistributed net realized gain on investments | | | 805,936 | |
Unrealized appreciation on investments | | | 23,136,876 | |
| | | | |
TOTAL NET ASSETS | | $ | 79,224,905 | |
| | | | |
SHARES OUTSTANDING (UNLIMITED SHARES OF NO PAR VALUE AUTHORIZED) | | | 2,242,474 | |
| | | | |
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE | | $ | 35.33 | |
See accompanying Notes to the Financial Statements.
BRIDGES INVESTMENT FUND, INC.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2012
(Unaudited)
INVESTMENT INCOME: | | | |
Dividend income (net of foreign tax withheld of $450) | | $ | 467,028 | |
Interest income | | | 66,962 | |
| | | | |
Total investment income | | $ | 533,990 | |
| | | | |
EXPENSES: | | | | |
Advisory fees | | $ | 201,280 | |
Administration fees | | | 46,752 | |
Dividend disbursing and transfer agent fees | | | 22,302 | |
Fund accounting fees | | | 21,364 | |
Independent director’s expenses and fees | | | 13,738 | |
Professional Services | | | 13,002 | |
Other | | | 10,026 | |
Printing and supplies | | | 6,834 | |
Custody fees | | | 6,175 | |
Taxes and licenses | | | 728 | |
| | | | |
Total expenses | | $ | 342,201 | |
NET INVESTMENT INCOME | | $ | 191,789 | |
| | | | |
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS | | | | |
Net realized gain on investments | | | 2,021,368 | |
| | | | |
Net change in unrealized appreciation on investments | | | 4,302,883 | |
| | | | |
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS | | | 6,324,251 | |
| | | | |
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | | $ | 6,516,040 | |
| | | | |
See accompanying Notes to the Financial Statements.
BRIDGES INVESTMENT FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED JUNE 30, 2012 AND 2011
(Unaudited)
| | 2012 | | | 2011 | |
OPERATIONS: | | | | | | |
Net investment income | | $ | 191,789 | | | $ | 156,468 | |
Net realized gain on investments | | | 2,021,368 | | | | 1,480,555 | |
Net increase in unrealized appreciation on investments | | | 4,302,883 | | | | 1,234,301 | |
| | | | | | | | |
Net increase in net assets resulting from operations | | $ | 6,516,040 | | | $ | 2,871,324 | |
| | | | | | | | |
Net equalization of debits/credits | | | (2,069 | ) | | | 250 | |
| | | | | | | | |
Distributions to shareholders: | | | | | | | | |
From net investment income | | | (179,125 | ) | | | (138,565 | ) |
| | | | | | | | |
Total distributions | | $ | (179,125 | ) | | $ | (138,565 | ) |
| | | | | | | | |
Capital share transactions: | | | | | | | | |
Net increase/ (decrease) in net assets from capital share transactions | | | (888,969 | ) | | | 105,901 | |
| | | | | | | | |
Total increase in net assets | | $ | 5,445,877 | | | $ | 2,838,910 | |
| | | | | | | | |
NET ASSETS: | | | | | | | | |
Beginning of the period | | $ | 73,779,028 | | | $ | 75,014,486 | |
| | | | | | | | |
End of the period (including undistributed net investment | | | | | | | | |
income of $10,595 and $19,103, respectively) | | $ | 79,224,905 | | | $ | 77,853,396 | |
| | | | | | | | |
See accompanying Notes to the Financial Statements.
BRIDGES INVESTMENT FUND, INC.
FINANCIAL HIGHLIGHTS
For a Fund share outstanding throughout the period
| | For the Six | | | | | | | | | | | | | | | | |
| | Months Ended | | | | | | | | | | | | | | | | |
| | June 30, 2012 | | | Years Ended December 31, | |
| | (Unaudited) | | | 2011 | | | 2010 | | | 2009 | | | 2008 | | | 2007 | |
| | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 32.55 | | | $ | 32.51 | | | $ | 29.28 | | | $ | 21.91 | | | $ | 34.28 | | | $ | 35.42 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Income (loss) from investment operations: | | | | | | | | | | | | | | | | | | | | | | | | |
Net investment income1 | | | 0.10 | | | | 0.16 | | | | 0.14 | | | | 0.17 | | | | 0.25 | | | | 0.23 | |
Net realized and unrealized gain/(loss) on investments | | | 2.76 | | | | 0.04 | | | | 3.22 | | | | 7.37 | | | | (12.36 | ) | | | 1.44 | |
Total from investment operations | | | 2.86 | | | | 0.20 | | | | 3.36 | | | | 7.54 | | | | (12.11 | ) | | | 1.67 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Less dividends and distributions: | | | | | | | | | | | | | | | | | | | | | | | | |
Dividends from net investment income | | | (0.08 | ) | | | (0.16 | ) | | | (0.13 | ) | | | (0.17 | ) | | | (0.25 | ) | | | (0.24 | ) |
Distributions from net realized gains | | | — | | | | — | | | | — | | | | — | | | | — | | | | (2.57 | ) |
Distributions from tax return of capital | | | — | | | | — | | | | — | | | | — | | | | (0.01 | ) | | | — | |
Total dividends and distributions | | | (0.08 | ) | | | (0.16 | ) | | | (0.13 | ) | | | (0.17 | ) | | | (0.26 | ) | | | (2.81 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, end of period | | $ | 35.33 | | | $ | 32.55 | | | $ | 32.51 | | | $ | 29.28 | | | $ | 21.91 | | | $ | 34.28 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total return | | | 8.78 | %2 | | | 0.62 | % | | | 11.50 | % | | | 34.61 | % | | | (35.47 | %) | | | 4.72 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental data and ratios: | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (in thousands) | | $ | 79,225 | | | $ | 73,779 | | | $ | 75,014 | | | $ | 67,435 | | | $ | 49,448 | | | $ | 77,417 | |
Ratio of net expenses to average net assets: | | | 0.86 | %3 | | | 0.88 | % | | | 0.90 | % | | | 1.02 | % | | | 0.77 | % | | | 0.80 | % |
Ratio of net investment income to average net assets: | | | 0.48 | %3 | | | 0.47 | % | | | 0.42 | % | | | 0.63 | % | | | 0.86 | % | | | 0.64 | % |
Portfolio turnover rate | | | 10.7 | % | | | 26.6 | % | | | 26.3 | % | | | 18.2 | % | | | 23.4 | % | | | 39.0 | % |
See accompanying Notes to the Financial Statements.
1 | Net investment income per share is calculated using the ending balances prior to consideration or adjustment for permanent book-to-tax differences. |
BRIDGES INVESTMENT FUND, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(Unaudited)
(1) | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Bridges Investment Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The primary investment objective of the Fund is long-term capital appreciation. In pursuit of that objective, the Fund invests primarily in common stocks. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America.
Security transactions are recorded on trade date. Dividend income is recognized on the ex-divided date, and interest income is recognized on an accrual basis. Discount and premium on fixed income securities is accreted or amortized into interest income using the effective interest method.
The net realized gain (loss) from the sales of securities is determined for income tax and accounting purposes on the basis of the cost of specific securities.
Securities owned are reflected in the accompanying statement of assets and liabilities and the schedule of investments at fair value based on quoted market prices. Bonds and other fixed-income securities (other than the short-term securities) are valued using the bid price provided by an independent pricing service. Other securities traded on a national securities exchange are valued at the last reported sale price at the close of regular trading on each day the exchange is open for trading. Securities listed on the NASDAQ National Market System for which market quotations are readily available are valued using the NASDAQ Official Closing Price (“NOCP”). If no sales were reported on that day, quoted market price represents the closing bid price.
Securities for which prices are not readily available were valued by the Fund’s valuation committee (the “Valuation Committee”) at a fair value determined in good faith under procedures established by and under the general supervision of the Fund’s Board of Directors.
The Valuation Committee concluded that a price determined under the Fund’s valuation procedures was not readily available if, among other things, the Valuation Committee believed that the value of the security might have been materially affected by an intervening significant event. A significant event may be related to a single issuer, to an entire market sector, or to the entire market. These events may include, among other things: issuer–specific events including rating agency action, earnings announcements and corporate actions, significant fluctuations in domestic or foreign markets, natural disasters, armed conflicts, and government actions. In the event that the market quotations are not readily available, the fair value of such securities will be determined in good faith, taking into consideration: (i) fundamental analytical data relating to the investment; (ii) the nature and duration of restrictions on disposition of the securities; and (iii) an evaluation of the forces which influence the market in which these securities are purchased and sold. The members of the Valuation Committee shall continuously monitor for significant events that might necessitate the use of fair value procedures.
It is the Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to Regulated Investment Companies (“RICs”) to distribute all of its taxable income to shareholders. Therefore, no Federal income tax provision for the Fund is required. Under applicable foreign tax law, a withholding tax may be imposed on interest, dividends, and capital gains earned on foreign securities.
The character of distributions made during the year from net investment income or net realized gains may differ from its ultimate characterization for federal income tax purposes. In addition, due to the timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains or losses were recorded by the Fund.
The Fund has not recorded any liability for material unrecognized tax benefits as of December 31, 2011. It is the Fund’s policy to recognize accrued interest and penalties related to uncertain benefits in income taxes as appropriate. Tax years that remain open to examination by major jurisdiction include tax years ended December 31, 2008 through December 31, 2011.
C. | Distribution To Shareholders – |
The Fund pays dividends to shareholders on a quarterly basis on the ex-dividend date. Distribution of net realized gains, if any, are made on an annual basis to shareholders on the ex-dividend date.
The Fund uses the accounting practice of equalization by which a portion of the proceeds from sales and costs of redemption of capital shares, equivalent on a per share basis to the amount of undistributed net investment income on the date of the transactions, is credited or charged to undistributed income. As a result, undistributed net investment income per share is unaffected by sales or redemption of capital shares.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
In preparing these financial statements, the Fund has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued.
F. | Fair Value Measurements – |
The Fund has adopted the Financial Accounting Standards Board (“FASB”) guidance on fair value measurements. Fair value is defined as the price that each Fund would receive upon selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market of the investment. A three-tier hierarchy is used to maximize the use of observable market data “inputs” and minimize the use of unobservable “inputs” and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The three-tier hierarchy of inputs is summarized in the three broad Levels listed below:
| Level 1 – | Unadjusted quoted prices in active markets for identical investments |
| Level 2 – | Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 – | Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available; representing the Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The FASB also issued guidance on how to determine the fair value of assets and liabilities when the volume and level of activity for the asset/liability have significantly decreased as well as guidance on identifying circumstances that indicate a transaction is not orderly. The valuation techniques used by the Fund to measure fair value for the six months ended June 30, 2012 maximized the use of observable inputs and minimized the use of unobservable inputs. During the six months ended June 30, 2012, no securities held by the fund were deemed as Level 3.
The following is a summary of the inputs used as of June 30, 2012 in valuing the Fund’s investments carried at market value:
| | Level 1 | | | Level 2 | | | Level 3 | | | Total | |
Equity | | | | | | | | | | | | |
Manufacturing | | $ | 26,792,610 | | | $ | — | | | $ | — | | | $ | 26,792,610 | |
Finance and Insurance | | | 10,209,390 | | | | — | | | | — | | | | 10,209,390 | |
Professional, Scientific | | | | | | | | | | | | | | | | |
and Technical Services | | | 8,960,327 | | | | — | | | | — | | | | 8,960,327 | |
Mining | | | 5,496,000 | | | | — | | | | — | | | | 5,496,000 | |
Information | | | 5,277,480 | | | | — | | | | — | | | | 5,277,480 | |
Transportation and Warehousing | | | 4,686,450 | | | | — | | | | — | | | | 4,686,450 | |
Wholesale Trade | | | 2,344,860 | | | | — | | | | — | | | | 2,344,860 | |
Accommodation and Food Services | | | 2,304,810 | | | | — | | | | — | | | | 2,304,810 | |
Retail Trade | | | 2,274,825 | | | | — | | | | — | | | | 2,274,825 | |
Construction | | | 1,138,800 | | | | — | | | | — | | | | 1,138,800 | |
Arts and Entertainment | | | | | | | | | | | | | | | | |
and Recreation | | | 970,000 | | | | — | | | | — | | | | 970,000 | |
Total Equity | | | 70,455,552 | | | | — | | | | — | | | | 70,455,552 | |
Exchange Traded Funds | | | | | | | | | | | | | | | | |
Finance and Insurance | | | 5,805,800 | | | | — | | | | — | | | | 5,805,800 | |
Fixed Income | | | | | | | | | | | | | | | | |
Corporate Bonds | | | — | | | | 1,709,976 | | | | — | | | | 1,709,976 | |
Total Fixed Income | | | — | | | | 1,709,976 | | | | — | | | | 1,709,976 | |
Short-Term Investments | | | 1,321,071 | | | | — | | | | — | | | | 1,321,071 | |
Total Investments in Securities | | $ | 77,582,423 | | | $ | 1,709,976 | | | $ | — | | | $ | 79,292,399 | |
There were no significant transfers between Levels 1 and 2 during the six months ended June 30, 2012. Transfers between levels are recognized at the end of the reporting period.
G. | Derivative Instruments and Hedging Activities – |
The Fund has adopted FASB guidance regarding disclosure about derivatives and hedging activities and how they affect the Fund’s Statement of Assets and Liabilities and Statement of Operations. The Fund did not enter into any derivative transactions during the six months ended June 30, 2012.
(2) | INVESTMENT ADVISORY CONTRACT AND OTHER TRANSACTIONS WITH AFFILIATES |
Under an Investment Advisory Contract, Bridges Investment Management, Inc. (the “Investment Adviser”) furnishes investment advisory services for the Fund. In return, the Fund has agreed to pay the Investment Adviser a management fee computed on a quarterly basis at the rate of 1/8 of 1% of the average month-end net asset value of the Fund during the quarter, equivalent to 1/2 of 1% per annum. Certain officers and directors of the Fund are also officers and directors of the Investment Adviser. These officers do not receive any compensation from the Fund other than that which is received indirectly through the Investment Adviser. For the six months ended June 30, 2012, the Fund incurred $201,280 in advisory fees.
The contract between the Fund and the Investment Adviser provides that total expenses of the Fund in any year, exclusive of taxes, but including fees paid to the Investment Adviser, shall not exceed, in total, a maximum of 1 and 1/2% of the average month end net asset value of the Fund for the year. Amounts, if any, expended in excess of this limitation are reimbursed by the Investment Adviser as specifically identified in the Investment Advisory Contract. There were no amounts reimbursed during the six months ended June 30, 2012.
The Fund has entered into a Board-approved contract with the Investment Adviser in which the Investment Adviser acts as primary administrator to the Fund at an annual rate of $42,500. U.S. Bancorp Fund Services, LLC acts as sub-administrator to the Fund, and for its services, receives an annual fee at the rate of 0.055% for the first $50 million of the Fund’s average net assets, 0.045% on the next $50 million of average net assets, and 0.04% on the balance, subject to an annual minimum of $35,000. These administrative expenses are shown as Administration Fees on the Statement of Operations.
Quasar Distributors, LLC (the “Distributor”), a registered broker-dealer, acts as the Fund’s principal underwriter in a continuous public offering of the Fund’s shares. The Distributor is an affiliate of U.S. Bancorp Fund Services, LLC.
The cost of long-term investment purchases during the six months ended June 30, 2012, were:
| | 2012 | | | 2011 | |
Non U.S. government securities | | | $8,381,282 | | | | $10,236,602 | |
Net proceeds from sales of long-term investments during the six months ended June 30, 2012, were:
| | 2012 | | | 2011 | |
Non U.S. government securities | | | $9,911,649 | | | | $10,833,230 | |
There were no long-term U.S. government transactions for the six months ended June 30, 2012 and 2011.
The net asset value per share represents the effective price for all subscription and redemptions.
Shares of capital stock issued and redeemed during the six months ended June 30, 2012, were as follows:
| | 2012 | | | 2011 | |
Shares sold | | | 36,114 | | | | 41,145 | |
Shares issued to shareholders in reinvestment of net investment income | | | 4,337 | | | | 3,584 | |
| | | 40,451 | | | | 44,729 | |
Shares redeemed | | | (64,455 | ) | | | (41,457 | ) |
Net (decrease)/increase | | | (24,004 | ) | | | 3,272 | |
Value of capital stock issued and redeemed during the six months ended June 30, 2012, were as follows:
| | 2012 | | | 2011 | |
Shares sold | | | 1,299,283 | | | | 1,382,125 | |
Shares issued to shareholders in reinvestment of net investment income | | | 157,619 | | | | 121,713 | |
| | | 1,456,902 | | | | 1,503,838 | |
Shares redeemed | | | (2,345,871 | ) | | | (1,397,937 | ) |
Net (decrease)/increase | | | (888,969 | ) | | | 105,901 | |
(6)DISTRIBUTIONS TO SHAREHOLDERS
On March 30, 2012 and June 29, 2012, cash distributions were declared from net investment income accrued through March 31, 2012 and June 30, 2012, respectively. These distributions were calculated as $0.04 and $0.04 per share. The dividends were paid on March 30, 2012 and June 29, 2012, to shareholders of record on March 29, 2012 and June 28, 2012.
(7)FEDERAL INCOME TAX INFORMATION
The tax character of distributions during the years ended December 31, 2011 and 2010 were as follows:
| | Ordinary | | | Long-Term | |
| | Income | | | Capital Gain | |
12/31/11 | | $ | 363,000 | | | $ | — | |
12/31/10 | | | 290,649 | | | | — | |
The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the dissimilar character of certain income items and net realized gains and losses for financial statement and tax purposes. Any permanent differences will result in reclassification among certain capital accounts in the financial statements. For the year ended December 31, 2011 the undistributed net investment income increased by $8,340 and paid-in-capital decreased by $8,340.
As of December 31, 2011, the components of the tax basis cost of investments and net unrealized appreciation were as follows:
Federal tax cost of investments | | $ | 55,012,026 | |
Unrealized appreciation | | $ | 20,750,774 | |
Unrealized depreciation | | $ | (1,916,781 | ) |
Net unrealized appreciation | | $ | 18,833,993 | |
As of December 31, 2011, the components of distributable earnings on a tax basis were as follows:
Net unrealized appreciation | | $ | 18,833,993 | |
Undistributed ordinary income | | $ | — | |
Undistributed long term gains | | $ | — | |
Distributable earnings | | $ | — | |
Other accumulated loss | | $ | (1,215,432 | ) |
Total accumulated capital earnings | | $ | 17,618,561 | |
At December 31, 2011, the Fund deferred, on a tax basis, post-October losses of $380,176.
The Fund has $835,256 in capital loss carryovers which expires on December 31, 2017.
The Fund utilized $662,494 of prior capital loss carryovers during the year ended December 31, 2011.
ADDITIONAL DISCLOSURES
(Unaudited)
Notification of Change in Auditors
On February 21, 2012, with the approval of the Board of Directors and its Audit Committee, Cohen Fund Audit Services, Ltd. (“Cohen”) was engaged as the independent registered public accounting firm for the Bridges Investment Fund (the “Fund”), for the fiscal year ending December 31, 2012. During the Fund’s two most recent fiscal years and the subsequent interim period, neither the Fund nor anyone acting on its behalf consulted with Cohen on the application of accounting principles to a specified transaction (either completed or proposed) or the type of audit opinion that might be rendered on the Fund’s financial statements, or concerning the subject of a disagreement or reportable event of the kinds described in Item 304(a)(1)(iv) and Item 304(a)(1)(v) of Regulation S-K, respectively.
Deloitte & Touche LLP (“D&T”) served as the Fund’s independent registered public accounting firm for the fiscal years ending December 31, 2002 through December 31, 2011. On August 21, 2012, the Fund’s Board of Directors, upon recommendation by its Audit Committee, ceased D&T’s engagement with respect to any audit services provided by D&T to the Fund for the fiscal year ended December 31, 2011.
The reports of D&T on the financial statements of the Fund for the fiscal years ended December 31, 2011 and 2010 contained no adverse opinion or disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or accounting principles. In connection with its audit for the fiscal years December 31, 2011 and 2010 and for the subsequent interim period preceding D&T’s replacement, the Fund had no disagreements with D&T on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of D&T would have caused D&T to make reference thereto in its reports on the financial statements for such years, and there were no reportable events of the kind described in Item 304(a)(1)(v) of Regulation S-K.
Shareholder Notification of Federal Tax Status
The Bridges Investment Fund designated 100% of dividends declared during the fiscal year ended December 31, 2011 as dividends qualifying for the dividends received deduction available to corporate shareholders.
The Bridges Investment Fund designated 100% of dividends declared from the net investment income during the fiscal year ended December 31, 2011 as qualified income under the Jobs and Growth Tax Relief Reconciliation Act of 2003.
Availability of Quarterly Portfolio Holdings Schedules
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, which is available on the SEC’s website at http://www.sec.gov or can be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.) These reports can also be obtained from the Fund by sending an e-mail to fund@bridgesinv.com or calling 1-800-939-8401.
Proxy Voting Policies and Procedures and Proxy Voting Record
A description of the policies and/procedures that the Fund uses to determine how to vote proxies relating to portfolio securities, and a report on how the Fund voted such proxies during the 12-month period ended June 30, 2011 can be obtained by request and without charge from the Fund by sending an e-mail to fund@bridgesinv.com or calling 1-800-939-8401, or from the SEC’s website at http://www.sec.gov.
Disclosure Regarding Fund Trustees and Officers
**Disinterested Persons
Also Known As Independent Directors**
Name, Age, | |
Position with | |
Fund and Term | |
of Office | Principal Occupation(s) and Directorships* |
| |
Nathan Phillips | Mr. Dodge is the Executive Vice President of N.P. Dodge Company. He has worked at N.P. Dodge Company |
Dodge III Age: 48 | since October, 1993. Mr. Dodge is also a principal officer and director of a number of subsidiary and affiliated |
| companies in the property management, insurance, and real estate syndication fields. Mr. Dodge became |
Director | a Director of Lauritzen Corp. in 2008 and of First State Bank of Loomis in 2003. |
(2010 – present) | |
Name, Age, | |
Position with | |
Fund and Term | |
of Office | Principal Occupation(s) and Directorships* |
| |
John J. Koraleski** | Mr. Koraleski is the acting President and CEO and a member of the Board of Directors of Union Pacific |
Age: 61 | Railroad Company. -Prior to the current position, Mr. Koraleski was the Executive Vice President-Marketing & |
| Sales of the Union Pacific Railroad Company headquartered in Omaha, Nebraska from March 1999 to March |
Director | 2012. Mr. Koraleski has been employed by Union Pacific since in June, 1972, where he has served in various |
(1995 – present) | capacities. He is a member of the Railroad’s Operating Committee. Mr. Koraleski also served as the Railroad’s |
| Chief Financial Officer and Controller of Union Pacific Corporation. In those positions, he was responsible for |
Chairman | the Railroad’s Information Technologies and Real Estate Departments. |
(2005 – 2012) | |
| |
Adam M. Koslosky | Mr. Koslosky is the President and Chief Executive Officer of Magnolia Metal Corporation. Magnolia Metal |
Age: 55 | Corporation is a bronze bearing manufacturer located in Omaha, Nebraska. Mr. Koslosky commenced his |
| career with Magnolia Metal Corporation in 1978 as Controller and Treasurer. Mr. Koslosky also is a general |
Director | partner of Mack Investments, Ltd., a privately held investment company located in Omaha, Nebraska. He has |
(2007 – present) | been a Director of Nebraska Methodist Hospital Foundation since 1993. Mr. Koslosky has been determined to |
| be an “audit committee financial expert” within the meaning of the Sarbanes Oxley Act of 2002 and the |
| regulations related thereto by the Fund’s Board of Directors. Mr. Koslosky serves as the Chairman of the Fund’s |
| Audit Committee. |
| |
Michael C. Meyer** | Mr. Meyer was elected Chairman of the Board on April 10, 2012. Mr. Meyer is currently the Vice President of |
Age: 53 | Asset Management of Tenaska, Inc. Tenaska is a privately held energy company that develops, constructs, owns |
| and operates large-scale non-utility power plants. Tenaska also markets natural gas, electricity and biofuels |
Chairman | products and, provides associated energy risk management services; provides management and operation |
(2012 – present) | services to private equity partnerships; and engages in natural gas exploration, production and associated |
| transportation systems. Prior to his current position, Mr. Meyer was Vice President, International Asset |
Director | Management with responsibility for managing Tenaska’s international business and has been employed at |
(2008 – present) | Tenaska since 1995. In his 30-plus years of financial and operations management experience in the banking and |
| energy industries, Mr. Meyer has held positions with the United States Treasury Department’s Office of the |
| Comptroller of the Currency, the Farm Credit System and the First National Bank of Omaha. Mr. Meyer has |
| been determined to be an “audit committee financial expert” within the meaning of the Sarbanes Oxley Act of |
| 2002 and the regulations related thereto by the Fund’s Board of Directors. Mr. Meyer has been designated as |
| the Lead Independent Director of the Fund. |
| |
Gary L. Petersen | Mr. Petersen is the retired President of Petersen Manufacturing Co. Inc. of DeWitt, Nebraska. Mr. Petersen |
Age: 69 | commenced employment with the company in February, 1966. He became President in May, 1979, and retired |
| in June, 1986. Petersen Manufacturing Co. Inc. produced a broad line of hand tools for national and worldwide |
Director | distribution under the brand names Vise-Grip, Unibit, Prosnip, and Punch Puller. Mr. Petersen serves as the |
(1987 – present) | Chairman of the Fund’s Administration and Nominating Committee. |
| |
Vice Chairman | |
(2005 – 2012) | |
| |
Robert Slezak** | Mr. Slezak was elected Vice Chairman of the Board on April 10, 2012. Mr. Slezak is currently an independent |
Age: 54 | management consultant, and has been since November 1999. Prior to that, Mr. Slezak served as Vice President, |
| Chief Financial Officer and Treasurer of the Ameritrade Holding Corporation from January 1989 to November |
Vice Chairman | 1999 and as a director from October 1996 to September 2002. Mr. Slezak currently serves as a member of the |
(2012 – present) | board of directors of United Western Bancorp, Inc. and Xanadoo Company, a provider of wireless |
| communication services. Mr. Slezak has been determined to be an “audit committee financial expert” within the |
Director | meaning of the Sarbanes Oxley Act of 2002 and the regulations related thereto by the Fund’s Board of |
(2008 – present) | Directors. |
* | Except as otherwise indicated, each individual has held the position shown or other positions in the same company for the last five years. |
** | Mr. Koraleski requested a leave of absence from his duties as Chairman of the Fund Board of Directors and Lead Independent Director in light of his new role as acting President and CEO of Union Pacific Railroad. On April 10, 2012, the Fund Board of Directors accepted Mr. Koraleski’s request for a leave of absence from such duties and appointed Mr. Meyer as the Chairman of the Fund Board of Directors and Mr. Slezak as the Vice Chairman of the Fund Board of Directors. |
The address for all Fund Directors is 256 Durham Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114.
| Interested Person Directors and Officers |
The following Directors and Officers are interested persons of the Fund. The determination of an interested person is based on the definition in Section 2(a)(19) of the Investment Company Act of 1940 and Securities and Exchange Commission Release (Release No. IC-24083, dated October 14, 1999), providing additional guidance to investment companies about the types of professional and business relationships that may be considered to be material for purposes of Section 2(a)(19).
Name, Age, | |
Position with | |
Fund and Term | |
of Office | Principal Occupation(s) and Directorships* |
| |
Edson L. | Since December 2000, Mr. Bridges has been President, Chief Executive Officer, and Director of Bridges |
Bridges III, CFA | Investment Management, Inc. Since August of 1983, Mr. Bridges has been a full-time member of the |
Age: 54 | professional staff of Bridges Investment Counsel, Inc. where he has served as Executive Vice President since |
| 1993. Mr. Bridges is also a Director of that firm. Mr. Bridges has been responsible for securities research and |
President | the investment management for an expanding base of discretionary management accounts, including the Fund, |
(1997 – present) | for more than 14 years. Mr. Bridges was elected President of Bridges Investment Fund, Inc. on April 11, 1997, |
| and he assumed the position of Portfolio Manager at the close of business on that date. Mr. Bridges became |
Chief Executive | Chief Executive Officer of the Fund on April 13, 2004. Mr. Bridges is an officer and a Director of Bridges |
Officer | Investor Services, Inc. and Chairman of the Board and Vice President of Provident Trust Company as well as the |
(2004 – present) | Managing Partner of Modern Portfolio Consultants Company, d/b/a MPC Wealth Management since 2009. |
| Mr. Bridges became a Director of Stratus Fund, Inc., an open-end, regulated investment company located in |
| Lincoln, Nebraska, in October, 1990 and is Chairman of the Audit Committee of the Stratus Fund. |
Director | |
(1991 – present) | |
| |
Robert W. | Mr. Bridges is a Director and Senior Equity Analyst at Sterling Capital Management LLC. Sterling Capital |
Bridges, CFA | Management LLC, located in Charlotte, North Carolina, is an investment management company founded in |
Age: 46 | 1970. Mr. Bridges commenced his career with Sterling Capital Management, LLC in 1996 and served in a |
| variety of capacities including client service, systems integration, and compliance before assuming his current |
Director | position in 2000. Mr. Bridges has been a Director of Bridges Investment Counsel, Inc. since December 2006, |
(2007 – present) | and a Director of Provident Trust Company since 2007. Prior to joining Sterling, Mr. Bridges served in |
| accounting, research analysis and several other roles for Bridges Investment Counsel, Inc. for six years. Mr. |
| Bridges earned his B.S. in Business from Wake Forest University, and became a CFA charter holder in 2003. |
Additional Officers of the Fund
Name, Age, | |
Position with | |
Fund and Term | |
of Office | Principal Occupation(s) and Directorships* |
| |
Edson L. | Mr. Bridges was elected Chairman Emeritus on April 15, 2006. Mr. Bridges had previously served as |
Bridges II, CFA | Chairman, Vice-Chairman, Chief Executive Officer, and President of the Fund. Mr. Bridges was replaced by |
Age: 80 | Edson L. Bridges III as Chief Executive Officer of the Fund on April 13, 2004. Since December 2000, Mr. |
| Bridges has served as a director of Bridges Investment Management, Inc. In September, 1959, Mr. Bridges |
Chairman Emeritus | became associated with the predecessor firm to Bridges Investment Counsel, Inc. and is presently the President, |
(2006 – present) | Director, and Chief Compliance Officer of Bridges Investment Counsel, Inc. Mr. Bridges is also President and |
| Director of Bridges Investor Services, Inc., and is President and Director of Provident Trust Company, chartered |
Vice-Chairman | to conduct business on March 11, 1992. |
(2005 – 2006) | |
| |
Chairman | |
(1997 – 2005) | |
| |
Chief Executive Officer | |
(1997 – 2004) | |
| |
President | |
(1970 – 1997) | |
| |
Director | |
(1963 – 2007) | |
| |
Nancy K. Dodge | Ms. Dodge has been an employee of Bridges Investment Management, Inc. since 1994, where she serves as a |
Age: 51 | Senior Vice President. After joining Bridges Investment Counsel, Inc. in January of 1980, her career progressed |
| through the accounting department of that Firm, to her present position as Senior Vice President of Investor |
Treasurer | Support and Fund Services. Ms. Dodge is the person primarily responsible for overseeing day to day operations |
(1986 – present) | for the Fund, and she is also the key person for handling relations with shareholders, the custodian bank, |
| transfer agent, and the auditor. She was appointed Chief Compliance Officer of the Fund, as of November 21, |
Chief Compliance | 2006. Ms. Dodge is a Senior Vice President and Director of Bridges Investor Services, Inc., and a Vice |
Officer | President and Trust Officer for Provident Trust Company. |
(2006 – present) | |
| |
Brian | Mr. Kirkpatrick has been an employee of Bridges Investment Management since 1994. Mr. Kirkpatrick serves |
Kirkpatrick, CFA | as a Senior Vice President, Director of Research, Chief Compliance Officer, and Director of Bridges Investment |
Age: 40 | Management. Having joined Bridges Investment Counsel, Inc. on August 24, 1992, He is a Senior Vice |
| President of Bridges Investment Counsel, and has been a full-time member of the professional staff of Bridges |
Executive Vice | Investment Counsel, Inc., responsible for securities research, and the investment management for an expanding |
President | base of discretionary management accounts, including the Fund, for more than 14 years. Mr. Kirkpatrick was |
(2006 – present) | appointed Sub Portfolio Manager of the Fund on April 12, 2005. Mr. Kirkpatrick also serves as a Vice President |
| for Provident Trust Company. |
Vice President | |
(2000 – 2006) | |
| |
Mary Ann Mason | Ms. Mason has been an employee of Bridges Investment Management since 1994, where she currently serves as |
Age: 60 | Senior Vice President, Corporate Secretary, and Treasurer. She joined Bridges Investment Counsel, Inc. in June |
| 1981, and currently is Senior Vice President, Corporate Secretary and Treasurer of such entity, and the |
Secretary | Secretary, Treasurer and Director of Bridges Investor Services, Inc. Ms. Mason also acts as Vice President, |
(1987 – present) | Secretary and Treasurer for Provident Trust Company. |
| |
Linda Morris | Ms. Morris has been an employee of Bridges Investment Management, Inc. since 1994. Having joined Bridges |
Age: 45 | Investment Counsel, Inc. in August of 1992, her career has been largely in the client accounting area where she |
| currently serves as Associate Director of Accounting. Ms. Morris was elected Assistant Treasurer of the Fund in |
Assistant Treasurer | April, 1999. Ms. Morris is also a Trust Assistant for Provident Trust Company. |
(1999 – present) | |
Name, Age, | |
Position with | |
Fund and Term | |
of Office | Principal Occupation(s) and Directorships* |
| |
Trinh Wu | Ms. Wu has been an employee of Bridges Investment Management and has served Bridges Investment Counsel, |
Age: 55 | Inc. since February 1, 1997. Ms. Wu has functioned as the lead accountant for the day to day operation of the |
| Fund. Ms. Wu currently is the Senior Accountant of Bridges Investment Counsel, Inc. Prior to her employment |
Controller | at Bridges Investment Management, Inc., Ms. Wu performed operating and accounting activities for 17 years in |
(2001 – present) | the Estate and Trust Department of the predecessor institutions to U.S. Bank, N.A. Nebraska. Ms. Wu was |
| elected to the position of Controller of the Fund at the October 16, 2001 meeting of the Board of Directors. |
* | Except as otherwise indicated, each individual has held the position shown or other positions in the same company for the last five years. |
The address for all Fund Officers is 256 Durham Plaza, 8401 West Dodge Road, Omaha, Nebraska 68114.
The Statement of Additional Information (SAI) includes additional information about Fund directors and is available at the Fund’s website, www.bridgesfund.com, or by calling 1-800-939-8401.
(This Page Intentionally Left Blank.)
BRIDGES INVESTMENT FUND, INC.
8401 West Dodge Road
Omaha, Nebraska 68114
Telephone 402-397-4700
Facsimile 402-397-8617
Directors |
|
Edson L. Bridges III |
Robert W. Bridges |
Nathan Phillips Dodge III |
John J. Koraleski |
Adam M. Koslosky |
Michael C. Meyer |
Gary L. Petersen |
Robert Slezak |
|
Officers |
|
Michael C. Meyer | Chairman and Lead Independent Director |
Edson L. Bridges II | Chairman Emeritus |
Edson L. Bridges III | President and Chief Executive and |
| Investment Officer |
Brian M. Kirkpatrick | Executive Vice President |
Mary Ann Mason | Secretary |
Nancy K. Dodge | Treasurer and Chief Compliance Officer |
Linda J. Morris | Assistant Treasurer |
Trinh Wu | Controller |
| |
Independent Registered Public Accounting Firm |
|
Cohen Fund Audit Services, Ltd. |
800 Westpoint Parkway, Suite 1100 |
Westlake, Ohio 44145 |
| |
Corporate Counsel | Counsel to Independent Directors |
| |
Baird, Holm, LLP | Koley Jessen P.C. |
Attorneys at Law | Attorneys at Law |
1500 Woodmen Tower | One Pacific Place, Suite 800 |
Omaha, Nebraska 68102 | 1125 South 103 Street |
| Omaha, Nebraska 68124 |
| |
Special Counsel | Distributor |
| |
Ballard, Spahr, Andrews & Ingersoll, LLP | Quasar Distributors, LLC |
1225 Seventeenth Street, Suite 2300 | 615 East Michigan Street |
Denver, Colorado 80202 | Milwaukee, Wisconsin 53202 |
Item 2. Code of Ethics.
Not applicable for semi-annual reports.
Item 3. Audit Committee Financial Expert.
Not applicable for semi-annual reports.
Item 4. Principal Accountant Fees and Services.
Not applicable for semi-annual reports.
Item 5. Audit Committee of Listed Registrants.
Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).
Item 6. Investments.
(a) Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form.
(b) Not Applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable to open-end investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
Item 11. Controls and Procedures.
(a) | The Registrant’s President and Treasurer have reviewed the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant and by the Registrant’s service provider. |
(b) | There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting. |
Item 12. Exhibits.
(a) | (1) Any code of ethics or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Incorporated by reference to the Registrant’s Form N-CSR filed March 3, 2008. |
(2) A separate certification for each principal executive and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable to open-end investment companies.
(b) | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Bridges Investment Fund, Inc.
By (Signature and Title)*/s/ Edson L. Bridges III
Edson L. Bridges III, President, CEO, CIO
Date 8/23/2012
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By (Signature and Title)*/s/ Edson L. Bridges III
Edson L. Bridges III, President, CEO, CIO
Date 8/23/2012
By (Signature and Title)* /s/ Brian M. Kirkpatrick
Brian M. Kirkpatrick, Executive Vice President
By (Signature and Title)* /s/ Nancy K. Dodge
Nancy K. Dodge, Treasurer, CCO
* Print the name and title of each signing officer under his or her signature.