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 811-03287 NEW ALTERNATIVES FUND, INC. 150 BROADHOLLOW ROAD, SUITE 306 MELVILLE, NEW YORK 11747 DAVID J. SCHOENWALD, PRESIDENT NEW ALTERNATIVES FUND, INC. 150 BROADHOLLOW ROAD, SUITE 306 MELVILLE, NEW YORK 11747 Registrant's telephone number, including area code: 631-423-7373 Date of fiscal year end: December 31, 2005 Date of reporting period: June 30, 2005 Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507. ================================================================================ Item 1. Reports to Stockholders. The Semiannual Financial Report (06/30/05) is attached herewith. SEMIANNUAL FINANCIAL REPORT JUNE 30, 2005 NEW ALTERNATIVES FUND, INC. FINANCIAL HIGHLIGHTS STATEMENT OF PER SHARE INCOME AND CAPITAL CHANGES For each share of capital stock outstanding* <TABLE> (Unaudited) Six Months Year Year Year Year Year Year Year Ended End End End End End End End 6/30 12/31 12/31 12/31 12/31 12/31 12/31 12/31 2005 2004 2003 2002 2001 2000 1999 1998 NET ASSET VALUE AT BEGINNING OF PERIOD $ 33.48 $ 29.69 $24.21 $34.71 $41.29 $28.85 $28.54 $32.07 -------- -------- ------- ------- ------- ------- ------- ------- Investment income $ 0.34 $ 0.59 $0.58 $0.62 $0.75 $0.79 $0.66 $0.52 Expenses (0.20) (0.42) (0.37) (0.37) (0.43) (0.42) (0.38) (0.37) ------ ------ ------ ------ ------ ------ ------ ------ Net investment income 0.14 0.17 0.21 0.25 0.32 0.37 0.28 0.15 Net realized & unrealized gain (loss) on investments 1.78 3.79 5.48 (10.50) (5.45) 14.56 2.14 (3.22) ----- ----- ----- ------- ------ ------ ----- ------ Total from investment operations 1.92 3.96 5.69 (10.25) (5.13) 14.93 2.42 (3.07) Distributions from net investment income (0.00) (0.17) (0.21) (0.25) (0.32) (0.37) (0.28) (0.15) Distributions from net realized gain (0.00) (0.00) (0.00) (0.00) (1.13) (2.12) (1.83) (0.16) ------ ------ ------ ------ ------ ------ ------ ------ Total distributions 0.00 (0.17) (0.21) (0.25) (1.45) (2.49) (2.11) (0.31) Net change in net asset value 1.92 3.79 5.48 (10.50) (6.58) 12.44 0.31 (3.53) ----- ----- ----- ------- ------ ------ ----- ------ Net asset value as of end of the period $ 35.40 $ 33.48 $29.69 $24.21 $34.71 $41.29 $28.85 $28.54 ======== ======== ======= ======= ======= ======= ======= ======= Total return (Sales load not reflected) 5.73% 13.34% 23.5% -29.5% -12.4% 51.7% 8.5% -10.0% Net assets, end of period (in thousands) $58,057 $52,615 $44,901 $36,723 $49,245 $52,773 $32,555 $33,021 Ratio of operating expense to net assets** 1.18% 1.32% 1.39% 1.32% 1.14% 1.11% 1.13% 1.18% Ratio of net investment income to average net assets** 0.76% 0.65% 0.82% 0.89% 0.87% 1.01% 0.89% 0.49% Portfolio turnover** 38.58% 50.05% 32.7% 32.6% 29.3% 59.7% 87.3% 32.4% Number of shares outstanding at end of period*** 1,640,171 1,565,049 1,512,199 1,516,709 1,368,171 1,211,783 1,058,230 1,156,952 Year Year Year Year Year Year First End End End End End End Seven 12/31 12/31 12/31 12/31 12/31 12/31 Months 1997 1996 1995 1994 1993 1992 04/30/83 **** NET ASSET VALUE AT BEGINNING OF PERIOD $30.87 $30.51 $28.14 $30.00 $29.95 $29.19 $12.50 ------- ------- ------- ------- ------- ------- ------ Investment income $0.64 $0.73 $0.75 $0.72 $0.62 $0.62 $ 0.38 Expenses (0.38) (0.39) (0.40) (0.40) (0.33) (0.28) (0.20) ------ ------ ------ ------ ------ ------ ------ Net investment income 0.26 0.34 0.35 0.32 0.29 0.34 0.18 Net realized & unrealized gain (loss) on investments 3.16 3.72 5.14 (1.43) 0.58 1.10 3.08 ----- ----- ----- ------ ----- ----- ---- Total from investment operations 3.42 4.06 5.49 (1.11) 0.87 1.44 3.26 Distributions from net investment income (0.26) (0.34) (0.35) (0.32) (0.29) (0.34) (0.18) Distributions from net realized gain (1.96) (3.36) (2.77) (0.43) (0.53) (0.34) (0.19) ------ ------ ------ ------ ------ ------ ------ Total distributions (2.22) (3.70) (3.12) (0.75) (0.82) (0.68) (0.37) Net change in net asset value 1.20 0.36 2.37 (1.86) 0.05 0.76 2.89 ----- ----- ----- ------ ----- ----- ---- Net asset value as of end of the period $32.07 $30.87 $30.51 $28.14 $30.00 $29.95 $15.39 ======= ======= ======= ======= ======= ======= ====== Total return (Sales load not reflected) 11.1% 13.3% 19.5% -3.7% 2.9% 4.9% 10.4% Net assets, end of period (in thousands) $37,941 $35,549 $32,236 $28,368 $31,567 $28,896 $163 Ratio of operating expense to net assets** 1.15% 1.21% 1.28% 1.30% 1.11% 1.04% 1.08% Ratio of net investment income to average net assets** 0.79% 1.04% 1.12% 1.04% 0.96% 1.25% 1.69% Portfolio turnover** 53.9% 51.2% 48.72% 33.0% 18.36% 13.1% 74.5% Number of shares outstanding at end of period*** 1,111,377 1,038,561 965,769 984,847 1,026,460 945,006 10,592 </TABLE> * All adjusted for two for one share split on July 26, 1985 and January 2, 1990 ** Annualized (includes state taxes, does not include foreign currency translations) *** Shares immediately prior to dividend - Fund commenced operation on September 3, 1982 **** At this time the Fund was on a fiscal year. Table for 1983-1990 is available on request. Deleted to make space. The accompanying notes are an integral part of these financial statements. NEW ALTERNATIVES FUND, INC. SCHEDULE OF INVESTMENTS JUNE 30, 2005 COMMON STOCKS: 84.49% SHARES MARKET VALUE ALTERNATE ENERGY AS A GROUP: 32.97% ALTERNATE ENERGY (WIND & HYDRO POWER 3.38% PRODUCERS & WAVES:) ***Canadian Hydro Development (Canada) 300,000 977,302 Idacorp Inc. 10,000 306,300 ***Renewable Energy Holdings PLC 10,000 9,231 **Trust Power Ltd. (New Zealand) 150,000 625,178 ---------- 1,918,011 ---------- ALTERNATE ENERGY (FUEL CELL): 1.92% *FuelCell Energy, Inc. 100,000 1,021,000 ***ITM Power PLC (United Kingdom) 30,000 52,698 *Medis Technologies Ltd. 1,000 16,600 ---------- 1,090,298 ---------- ALTERNATE ENERGY (SOLAR CELL): 8.72% ***ATS Automation (Canada) 70,000 965,872 ***Conergy AG 5,000 487,288 *Evergreen Solar 1,000 6,430 Kyocera Corp. (ADR) (Japan) 25,000 1,917,500 Sharp Corp. Ltd. (ADR) (Japan) 100,000 1,564,840 ---------- 4,941,930 ---------- ALTERNATE ENERGY (WIND TURBINES/WIND 10.04% PROJECTS): **Acciona (Spain) 25,000 2,481,840 **Gamesa Corporation Techologica (Spain) 175,000 2,375,000 **Vestas Wind Systems (Denmark) 50,000 830,585 ---------- 5,687,425 ---------- ALTERNATE ENERGY (BIOMASS): 4.10% **Abengoa (Spain) 200,000 2,324,455 ---------- 2,324,455 ---------- ALTERNATE ENERGY (GEOTHERMAL): 2.70% Ormat Technologie 80,000 1,528,000 ---------- 1,528,000 ---------- ALTERNATE ENERGY RELATED (BATTERIES FOR 2.10% HYBRID AUTOMOBILES): Matsushita Electric (ADR) (Japan) 70,000 1,062,600 Sanyo Electric (ADR) (Japan) 10,000 130,100 ---------- 1,192,700 ---------- The accompanying notes are an intergral part of these financial statements. NEW ALTERNATIVES FUND, INC. SCHEDULE OF INVESTMENTS (CONTINUED) JUNE 30, 2005 SHARES MARKET VALUE INDUSTRIAL CATALYSTS (FUEL CELLS & CLEAN AIR): 3.11% Engelhard Corp. 35,000 999,250 **Johnson Matthey (United Kingdom) 40,000 765,012 ---------- 1,764,262 ---------- WATER: 6.12% Aqua America 10,000 297,400 Badger Meter 45,000 1,858,500 ***Zenon Environmental Inc. (Canada) 65,000 1,311,888 ---------- 3,467,788 ---------- ENERGY CONSERVATION: 10.38% Asahi Glass Company 5,000 526,126 Baldor Electric 70,000 1,702,400 *Cree, Inc. 25,000 636,750 *Intermagnetics General Corp. 20,000 615,200 *International Rectifier 25,000 1,193,000 Linear Technology Corp. 30,000 1,100,700 ***RailPower Technologies Corp. (Canada) 25,000 110,222 ---------- 5,884,398 ---------- NATURAL FOODS: 3.25% *SunOpta, Inc. (Canada) 100,000 568,000 *United Natural Foods 40,000 1,214,800 *Wild Oats Markets 5,000 57,250 ---------- 1,840,050 ---------- RECYCLING: 1.30% *Caraustar Industries 5,000 52,500 Commercial Metals 15,000 357,300 *Kadant, Inc. 15,000 328,950 ---------- 738,750 ---------- NATURAL GAS DISTRIBUTION: 24.07% Atmos Energy Corp. 40,000 1,152,000 Equitable Resources 20,000 1,360,000 KeySpan Corp. 50,000 2,035,000 New Jersey Resources 45,000 2,171,250 Piedmont Natural Gas 60,000 1,441,200 South Jersey Industries 35,000 2,139,200 The Laclede Group 50,000 1,588,000 Northwest Natural Gas 15,000 573,600 WGL Holdings 35,000 1,177,400 ----------- 13,637,650 ----------- OTHER (INDUSTRIAL GASES INCLUDING HYDROGEN): 3.29% - ---------- Praxair Inc. 40,000 1,864,000 ------------ TOTAL COMMON STOCK (COST $39,123,800) $ 47,879,717 ============ The accompanying notes are an intergral part of these financial statements. NEW ALTERNATIVES FUND, INC. SCHEDULE OF INVESTMENTS (CONTINUED) JUNE 30, 2005 <TABLE> CERTIFICATES OF DEPOSITS AND U.S. TREASURY BILLS: 15.51% SOCIALLY CONCERNED BANKS Alternatives Federal Credit Union Certificate of Deposit maturity 07/31/05 0.50% $ 100,000 Chittenden Bank Certificate of Deposit maturity 12/03/05 2.00% 100,000 Community Capital Bank Certificate of Deposit maturity 07/01/05 1.00% 100,000 Self-Help Credit Union Certificate of Deposit maturity 08/10/05 3.20% 100,000 South Shore Bank Certificate of Deposit maturity 07/25/05 2.60% 100,000 U.S. Treasury Bills (at various yields maturing at various dates in July & August, 2005 maturity value $8,300,000) (Cost $8,278,695) 8,287,171 --------- TOTAL MARKET DEPOSITS AND TREASURY BILLS $ 8,787,171 =========== Total Common Stock (84.49%) $ 47,879,717 Bank Money Market and U.S. Treasury Bills (15.51%) 8,787,171 --------- TOTAL INVESTMENTS (100%) $ 56,666,888 ============ </TABLE> * Securities for which no cash dividends were paid during the fiscal year. ** Foreign Exchange Securities traded on a foreign exchange. *** Foreign Exchange Securities traded on a foreign exchange with no cash dividend. The accompanying notes are an intergral part of these financial statements. NEW ALTERNATIVES FUND, INC. STATEMENT OF ASSETS AND LIABILITIES JUNE 30, 2005 ASSETS <TABLE> Investment securities at fair value (cost: $39,123,800) (notes 2A and 5)........ $ 47,879,717 U.S. Treasury Bills at fair value............................................... 8,287,171 Cash, Savings and Certificates of Deposit....................................... 500,000 Cash............................................................................ 247,342 Receivables: Dividends......................................................... 103,765 Interest.......................................................... 667 Subscriptions..................................................... 86,062 Investment Security Tendered...................................... 1,155,557 Prepaid Insurance & Filing Fees................................................. 18,991 ------------ TOTAL ASSETS 58,279,272 ------------ LIABILITIES Payables: Investment securities purchased................................................. 142,850 Capital stock reacquired........................................................ 21,847 Advisory fee.................................................................... 31,613 Other accounts payable and accruals............................................. 26,446 ------------ TOTAL LIABILITIES............................................................... 222,756 ------------ NET ASSETS $ 58,056,516 - ---------- ============ ANALYSIS OF NET ASSETS Net capital paid in shares of capital stock..................................... $48,681,841 ------------ Undistributed net investment income............................................. 217,678 Accumulated net realized gain on investments.................................... 401,432 Net unrealized gain on investments 8,755,565 ------------ Distributable earnings.......................................................... 9,374,675 ------------ NET ASSETS (equivalent to $35.40 per share based on 1,640,170.880 shares of capital stock outstanding) $ 58,056,516 ============ </TABLE> The accompanying notes are an integral part of these financial statements. NEW ALTERNATIVES FUND, INC. STATEMENT OF OPERATIONS FOR THE PERIOD ENDING JUNE 30, 2005 <TABLE> INVESTMENT INCOME: Dividends (net of foreign withholding taxes of $17,352)......................... $ 475,638 Interest........................................................................ 78,274 Total Income.................................................................... 553,912 ----------- EXPENSES: Management fee (note 4)......................................................... 182,182 Custodian fees: PFPC Trust...................................................... 20,670 Other........................................................................... 58 Auditor......................................................................... 10,644 Directors....................................................................... 3,224 Filing fees..................................................................... 5,539 Postage and printing............................................................ 5,669 Bond and insurance.............................................................. 1,609 Transfer Agent-PFPC, Inc........................................................ 31,950 Accounting/Pricing-PFPC, Inc.................................................... 27,065 Shareholder service costs....................................................... 47,700 ----------- Total Expenses.................................................................. 336,310 ----------- NET INVESTMENT INCOME........................................................... 217,602 ----------- NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS REALIZED GAIN ON INVESTMENTS (NOTES 2B & 5) Proceeds from sales............................................................. 10,601,464 Cost of securities sold......................................................... (8,564,881) Foreign currency transactions gains (loss)...................................... (9,452) ----------- Net Realized Gain/Loss.......................................................... 2,027,131 ----------- UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS Beginning of period............................................................. 7,866,325 End of period................................................................... 8,755,565 Foreign currency translations................................................... (352) ----------- Total Unrealized Appreciation (Depreciation) For The Period..................... 888,888 ----------- Net Realized and Unrealized Gain (Loss) On Investments.......................... 2,916,019 ----------- NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS................ $ 3,133,621 =========== </TABLE> The accompanying notes are an intergral part of these financial statements. NEW ALTERNATIVES FUND, INC. STATEMENT OF CHANGES IN NET ASSETS FOR THE SIX MONTHS ENDED JUNE 30, 2005 AND YEAR ENDED DECEMBER 31, 2004 2005 2004 FROM INVESTMENT ACTIVITIES: Net investment income $ 217,602 $ 306,344 Net realized gain (loss) from security transactions and foreign currency transactions 2,027,131 4,849,702 Unrealized appreciation of investments 888,888 975,714 -------- ------- Increase in net assets derived from investment activities 3,133,621 6,131,760 ---------- --------- DISTRIBUTIONS TO SHAREHOLDERS: From net investment income dividends to shareholders 0 (258,444) Distributions (capital gain) to shareholders 0 0 FROM CAPITAL SHARE TRANSACTIONS: Net increase from capital transactions (note 3) 2,307,661 1,840,778 ---------- --------- INCREASE IN NET ASSETS: 5,441,282 7,714,094 NET ASSETS AT: Beginning of the period 52,615,234 44,901,140 ----------- ---------- END OF THE PERIOD $ 58,056,516 $ 52,615,234 ============ ============ The accompanying notes are an integral part of these financial statements. NEW ALTERNATIVES FUND, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 2005 1) ORGANIZATION - The New Alternatives Fund, Inc. is registered as an open-end investment company under the Investment Company Act of 1940, as amended. The Fund commenced operations September 3, 1982. The investment objective of the Fund is to seek long-term capital gains by investing in common stocks that provide a contribution to a clean and sustainable environment. 2) ACCOUNTING POLICIES - The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of these financial statements. The policies are in conformity with generally accepted accounting principles: A. SECURITY VALUATION - Listed U.S. investments are stated at the last reported sale price at the closing of a national securities stock exchange and the NASD National Market System on June 30, 2005 and at the mean between the bid and asked price on the over the counter market if not traded on the day of valuation. Company shares traded on foreign markets are stated at their foreign reported value at 4:00 PM EST-as trading in some foreign markets does not coincide with trading on U.S. markets. Portfolio securities for which there are no such quotations or valuations are determined in good faith by or at the direction of the Fund's Board of Directors. B. FOREIGN CURRENCY - Investment securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments. Reported net realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund's books and the U.S. dollar equivalent of the amounts actually received or paid. C. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions are accounted for on the trade date (date order to buy or sell is executed). Realized gains and losses from security transactions are reported on a first in, first out basis if not traded on the day of valuation. Short-term notes are stated at amortized cost which approximates fair value. D. INVESTMENT INCOME AND EXPENSE RECOGNITION - Dividend income is recorded as of the ex-dividend date. Certificates of Deposit interest income is accrued daily. Expenses are accrued on a daily basis. E. FEDERAL INCOME TAXES - No provision for federal income tax is believed necessary since the Fund distributes all of its taxable income to comply with the provisions of the Internal Revenue Code applicable to investment companies. The aggregate cost of the securities (common stocks) owned by the Fund on June 30, 2005 for federal tax purposes is $39,123,800. NEW ALTERNATIVES FUND, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 2005 F. USE OF ESTIMATES - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. 3) CAPITAL STOCK - There are 8,000,000 shares of $1.00 par value capital stock authorized. On June 30, 2005, there were 1,640,170.880 shares outstanding. Aggregate paid in capital including reinvestment of dividends was $48,681,841. Transactions in capital stock were as follows: <TABLE> Six Months Ending 06/30/05 Year End 12/31/04 -------------------------- ----------------- Shares Amount Shares Amount Capital stock sold 108,431.350 $3,648,196 128,552.699 $3,961,831 Capital stock issued - - - - Reinvestment of dividends 4.169 140 6,524.850 218,451 Redemptions (39,910.960) (1,340,675) (75,622.199) (2,339,504) ----------- ---------- ----------- ---------- Net Increase (Decrease) 68,524.559 $2,307,661 59,455.350 $1,840,778) ========== ========== =========== ========== </TABLE> 4) MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES - Pursuant to agreements, Accrued Equities, Inc. serves as investment advisor to the Fund. The Fund pays to Accrued Equities, Inc. an annual management fee of 1.00% of the first $10 million of average net assets; 0.75% of the next $20 million; 0.50% of net assets over $30 million and 0.45% of assets over $100 million. If the net annual expenses of the Fund (other than interest, taxes, brokerage commissions, extraordinary expenses) exceed the most restrictive limitation imposed by any state in which the Fund has registered its securities for sale, Accrued Equities, Inc. reduces its management fee by the amount of such excess expenses. The annualized expense ratio for the six months ended June 30, 2005 was 1.18%. The Fund pays no remuneration to its officers, David Schoenwald and Maurice Schoenwald, who are also Directors. They are also officers of Accrued Equities, Inc. Accrued Equities, Inc. is the principal underwriter for the Fund. There is a commission of 4.75% on most new sales. The commission is shared with other brokers who actually sell new shares. Their share of the commission may vary. The Fund paid Accrued Equities, Inc. a total of $26,575 in underwriting fees for the six months ended June 30, 2005. The Fund also paid Accrued Equities, Inc. $57,189 in commissions for the six months ended June 30, 2005. 5) PURCHASES AND SALES OF SECURITIES - For the six month period ended June 30, 2005, the aggregate cost of securities purchased totaled $8,961,646. Net realized gains (loss) were computed on a first in, first out basis. The amount realized on sales of securities for the six months ending June 30, 2005 was $10,601,464. 6) DIRECTORS FEES - The amount charged (accrued) for the six months period ending June 30, 2005 for Directors compensation was $3,896. Only non-interested Directors are compensated. A non-interested Director is not part of the management of the Fund. Each non-interested Director receives $500 of compensation, or $1,000 for members of the Audit Committee, and may also receive payment for travel costs to Directors meetings. There was no additional compensation paid to any Director for board service other than that stated. See Note 4 for compensation regarding interested Directors. 7) PROXY VOTING - The Fund has proxy voting policies which are available, without charge, upon request by calling the Fund at 800-423-8383. Proxy votes of the Fund are available by calling the Fund.
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N-CSR Filing
New Alternatives Fund- (NALFX) N-CSRCertified annual shareholder report (management investment company)
Filed: 24 Aug 05, 12:00am