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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number | 811-05339 | |
CONCORDE FUNDS, INC.
5430 LBJ Freeway, Suite 1500, Dallas, TX 75240-2675
Gary B. Wood, 5430 LBJ Freeway, Suite 1500, Dallas, TX 75240-2675
Registrant’s telephone number, including area code: | (972) 404-1500 | |||
Date of fiscal year end: | September 30, 2005 | |||
Date of reporting period: | March 31, 2005 |
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Item 1. Reports to Stockholders.
Item 2. Code of Ethics. Not required for semi-annual report
Item 3. Audit Committee Financial Expert. Not required for semi-annual report
Item 4. Principal Accountant Fees and Services. Not required for semi-annual report
Item 5. Audit Committee of Listed Registrants. Not applicable
Item 6. Schedule of Investments. All investments in securities are included as a part of the report filed under Item 1
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. Not applicable
Item 8. Portfolio Managers of Closed-End Management Investment Companies. Not applicable
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. Not applicable
Item 10. Submission of Matters to a Vote of Security Holders. None
Item 11. Controls and Procedures.
(a) | The disclosure controls and procedures of Concorde Funds, Inc. (the “Fund”) are periodically evaluated. As of March 31, 2005, the date of the last evaluation, we concluded that our disclosure controls and procedures are adequate. | |||
(b) | Since, March 31, 2005, there have been no significant changes in the Fund’s internal controls or in other factors that could have had a significant effect on such controls. There have also been no significant deficiencies or material weaknesses identified since the last evaluation that required any corrective action. |
Item 12. Exhibits.
(a)(1) | Not required for semi-annual report | |||
(a)(2) | CERTIFICATIONS – EX-99.CERT | |||
(a)(3) | none | |||
(b) | CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT – EX-99.906CERT |
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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) | CONCORDE FUNDS, INC. | |||
By: | /s/ Gary B. Wood | |||
Gary B. Wood, President | ||||
Date | May 10, 2005 | |||
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: | /s/ Gary B. Wood | |||
Gary B. Wood, Principal Executive Officer | ||||
Date | May 10, 2005 | |||
By: | /s/ Gary B. Wood | |||
Gary B. Wood, Principal Financial Officer | ||||
Date | May 10, 2005 | |||
* Print the name and title of each signing officer under his or her signature.
Certificaitons | ||||||||
Certificaiton Pursuant to Section 906 |
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Concorde Value Fund | 10.75% | |||
S&P 500 | 6.88% | |||
Russell 1000 Value | 10.48% | |||
Russell 2000 | 8.00% | |||
Wilshire 4500 | 10.24% |
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Best regards, | |
Gary B. Wood, Ph.D. | |
President |
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Shares or | Percent of | ||||||||||||
Principal | Net | ||||||||||||
Amount | Value | Assets | |||||||||||
COMMON STOCKS | |||||||||||||
CONGLOMERATES | |||||||||||||
Tyco International Ltd. | 26,030 | $ | 879,814 | 5.33 | % | ||||||||
CONSUMER STAPLES | |||||||||||||
Altria Group, Inc. | 5,200 | 340,028 | 2.06 | ||||||||||
Playtex Products, Inc.(a) | 20,000 | 180,000 | 1.09 | ||||||||||
SUPERVALU INC | 20,000 | 667,000 | 4.04 | ||||||||||
1,187,028 | 7.19 | ||||||||||||
ENERGY AND NATURAL RESOURCES | |||||||||||||
Burlington Resources, Inc. | 3,500 | 175,245 | 1.06 | ||||||||||
Devon Energy Corporation | 10,000 | 477,500 | 2.89 | ||||||||||
Weatherford International, Inc.(a) | 6,000 | 347,640 | 2.11 | ||||||||||
1,000,385 | 6.06 | ||||||||||||
ENTERTAINMENT | |||||||||||||
Comcast Corp. Class A Special(a) | 21,000 | 701,400 | 4.25 | ||||||||||
Viacom, Inc. Class B | 19,000 | 661,770 | 4.01 | ||||||||||
1,363,170 | 8.26 | ||||||||||||
FINANCE AND INSURANCE | |||||||||||||
Delphi Financial Group, Inc. | 11,622 | 499,746 | 3.03 | ||||||||||
Fiserv(a) | 9,500 | 378,100 | 2.29 | ||||||||||
Lehman Brothers Holdings Inc. | 10,600 | 998,096 | 6.05 | ||||||||||
MBIA Inc. | 10,000 | 522,800 | 3.17 | ||||||||||
2,398,742 | 14.54 | ||||||||||||
HEALTH | |||||||||||||
Abbott Laboratories | 12,500 | 582,750 | 3.53 | ||||||||||
Conmed(a) | 16,500 | 496,980 | 3.01 | ||||||||||
Health Management Associates Inc. CL A | 24,000 | 628,320 | 3.81 | ||||||||||
Johnson & Johnson | 13,500 | 906,660 | 5.49 | ||||||||||
Pfizer Inc. | 20,700 | 543,789 | 3.30 | ||||||||||
3,158,499 | 19.14 | ||||||||||||
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Shares or | Percent of | ||||||||||||
Principal | Net | ||||||||||||
Amount | Value | Assets | |||||||||||
INDUSTRIAL CYCLICALS | |||||||||||||
Headwaters, Inc.(a) | 10,500 | 344,610 | 2.09 | ||||||||||
Illinois Tool Works, Inc. | 5,500 | 492,415 | 2.98 | ||||||||||
Lockheed Martin Corporation | 12,500 | 763,250 | 4.63 | ||||||||||
Terex Corp.(a) | 15,000 | 649,500 | 3.94 | ||||||||||
2,249,775 | 13.63 | ||||||||||||
REAL ESTATE | |||||||||||||
First Industrial Realty Trust, Inc. | 5,000 | 189,150 | 1.15 | ||||||||||
RETAIL TRADE | |||||||||||||
IHOP Corporation | 14,000 | 667,520 | 4.05 | ||||||||||
Office Depot(a)(b) | 15,000 | 332,700 | 2.02 | ||||||||||
1,000,220 | 6.06 | ||||||||||||
SERVICES | |||||||||||||
Oracle Corporation(a) | 35,550 | 443,664 | 2.69 | ||||||||||
Waste Management, Inc. | 20,000 | 577,000 | 3.50 | ||||||||||
1,020,664 | 6.19 | ||||||||||||
TECHNOLOGY | |||||||||||||
Intel Corporation | 25,000 | 580,750 | 3.52 | ||||||||||
UTILITIES | |||||||||||||
CH Energy Group | 4,000 | 182,800 | 1.11 | ||||||||||
TOTAL COMMON STOCKS (cost $9,596,070) | 15,210,997 | 92.18 | |||||||||||
SHORT TERM DEMAND NOTES | |||||||||||||
American Family Financial Services, 2.4663% | 70,000 | 70,000 | 0.42 | ||||||||||
Wisconsin Corporate Central Credit Union, 2.5200% | 421,445 | 421,445 | 2.55 | ||||||||||
U.S. Bank Demand Note, 2.6000% | 691,318 | 691,318 | 4.19 | ||||||||||
TOTAL SHORT TERM DEMAND NOTES (cost $1,182,763) | 1,182,763 | 7.17 | |||||||||||
CERTIFICATE OF DEPOSIT | |||||||||||||
U.S. Bank CD, .9%, due 10-01-2005 (cost $2,684) | 2,684 | 2,684 | 0.02 | ||||||||||
TOTAL INVESTMENTS IN SECURITIES (cost $10,781,517) | $ | 16,396,444 | 99.36 | % | |||||||||
(a) | Presently non-income producing | |
(b) | 5,000 shares subject to option |
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Shares Subject | |||||||||
to Call | Value | ||||||||
SECURITY/ EXPIRATION DATE/ EXERCISE PRICE | |||||||||
Office Depot/ April/171/2 | 5,000 | $ | 22,500 | ||||||
TOTAL (premiums receivable $23,749) | $ | 22,500 | |||||||
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March 31, | September 30, | |||||||||
2005 | 2004 | |||||||||
(Unaudited) | ||||||||||
ASSETS | ||||||||||
Investments in securities, at value (cost $10,781,517 and $10,611,077, respectively) | $ | 16,396,444 | $ | 14,814,962 | ||||||
Receivables | ||||||||||
Securities sold | 111,646 | — | ||||||||
Options written | 23,749 | — | ||||||||
Dividends | 18,031 | 16,016 | ||||||||
Interest | 2,109 | 2,309 | ||||||||
Other assets | 4,727 | 2,856 | ||||||||
TOTAL ASSETS | 16,556,706 | 14,836,143 | ||||||||
LIABILITIES | ||||||||||
Covered call options written, at value (premiums received $23,749 and $22,999, respectively) | 22,500 | 28,800 | ||||||||
Investment advisory fee payable | 12,515 | 10,841 | ||||||||
Accrued expenses | 19,483 | 18,334 | ||||||||
TOTAL LIABILITIES | 54,498 | 57,975 | ||||||||
NET ASSETS | ||||||||||
Equivalent to $16.50 and $15.66 per share on 999,849 and 943,851 shares of capital stock outstanding, respectively | $ | 16,502,208 | $ | 14,778,168 | ||||||
ANALYSIS OF NET ASSETS: | ||||||||||
Net capital paid in on shares of capital stock | $ | 10,888,735 | $ | 9,978,523 | ||||||
Undistributed investment loss | (224,174 | ) | (179,244 | ) | ||||||
Undistributed net realized gains | 221,471 | 780,805 | ||||||||
Net unrealized appreciation | 5,616,176 | 4,198,084 | ||||||||
$ | 16,502,208 | $ | 14,778,168 | |||||||
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Oct. 1, 2004 | ||||||||||
through | Year Ended | |||||||||
Mar. 31, 2005 | Sept. 30, 2004 | |||||||||
(Unaudited) | ||||||||||
INVESTMENT INCOME | ||||||||||
Dividends | $ | 100,840 | $ | 173,356 | ||||||
Interest | 15,429 | 16,562 | ||||||||
Total investment income | 116,269 | 189,918 | ||||||||
EXPENSES | ||||||||||
Investment advisory fee | 70,778 | 130,410 | ||||||||
Custodian fees | 2,548 | 5,274 | ||||||||
Printing, postage and delivery | 8,481 | 16,636 | ||||||||
Accounting fees | 11,830 | 23,119 | ||||||||
Transfer agent fees | 7,480 | 15,043 | ||||||||
Legal fees | 46,090 | 83,871 | ||||||||
Registration fees | 855 | 2,494 | ||||||||
Audit fees | 8,226 | 16,590 | ||||||||
Other expenses | 4,910 | 7,237 | ||||||||
Total expenses | 161,198 | 300,674 | ||||||||
NET INVESTMENT LOSS | (44,929 | ) | (110,756 | ) | ||||||
REALIZED GAIN AND UNREALIZED APPRECIATION ON INVESTMENTS IN SECURITIES AND REALIZED LOSS AND UNREALIZED APPRECIATION ON COVERED CALL OPTIONS WRITTEN | ||||||||||
Net realized gain on investments in securities | 338,672 | 883,530 | ||||||||
Net realized loss on covered call options written | (110,756 | ) | (99,313 | ) | ||||||
Net change in unrealized appreciation of investments in securities | 1,411,041 | 1,026,190 | ||||||||
Net change in unrealized appreciation of covered call options written | 7,050 | 1,377 | ||||||||
NET GAIN ON INVESTMENTS | 1,646,007 | 1,811,784 | ||||||||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 1,601,078 | $ | 1,701,028 | ||||||
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Oct. 1, 2004 | |||||||||
through | Year Ended | ||||||||
Mar. 31, 2005 | Sept. 30, 2004 | ||||||||
(Unaudited) | |||||||||
CHANGE IN NET ASSETS FROM OPERATIONS | |||||||||
Net investment loss | $ | (44,929 | ) | $ | (110,756 | ) | |||
Net realized gain on investments | 227,916 | 784,217 | |||||||
Net change in unrealized appreciation of investments | 1,418,091 | 1,027,567 | |||||||
Net increase in net assets resulting from operations | 1,601,078 | 1,701,028 | |||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM | |||||||||
Net investment income | — | — | |||||||
Net realized gains on investments | (787,250 | ) | (214,432 | ) | |||||
CAPITAL SHARE TRANSACTIONS — NET | 910,212 | 270,746 | |||||||
Total increase in net assets | 1,724,040 | 1,757,342 | |||||||
NET ASSETS | |||||||||
Beginning of period | 14,778,168 | 13,020,826 | |||||||
END OF PERIOD (including undistributed net investment loss of ($224,174) and ($179,244), respectively) | $ | 16,502,208 | $ | 14,778,168 | |||||
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6 Mths | |||||||||||||||||||||||||
Ended | Year Ended September 30, | ||||||||||||||||||||||||
Mar. 31, | |||||||||||||||||||||||||
2005(1) | 2004 | 2003 | 2002 | 2001 | 2000 | ||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
PER SHARE DATA(2): | |||||||||||||||||||||||||
Net asset value, beginning of period | $ | 15.66 | $ | 14.07 | $ | 12.79 | $ | 15.87 | $ | 17.95 | $ | 15.50 | |||||||||||||
Income from investment operations: | |||||||||||||||||||||||||
Net investment income | (0.05 | ) | (0.12 | ) | (0.08 | ) | 0.04 | 0.06 | 0.03 | ||||||||||||||||
Net realized and unrealized gain (loss) on investments in securities | 1.72 | 1.94 | 1.69 | (1.79 | ) | (1.22 | ) | 2.93 | |||||||||||||||||
Total income (loss) from investment operations | 1.67 | 1.82 | 1.61 | (1.75 | ) | (1.16 | ) | 2.96 | |||||||||||||||||
Less distributions: | |||||||||||||||||||||||||
Distributions from net investment income | — | — | (0.04 | ) | (0.03 | ) | (0.06 | ) | (0.02 | ) | |||||||||||||||
Distributions from net realized gains | (0.83 | ) | (0.23 | ) | (0.29 | ) | (1.30 | ) | (0.86 | ) | (0.49 | ) | |||||||||||||
Total from distributions | (0.83 | ) | (0.23 | ) | (0.33 | ) | (1.33 | ) | (0.92 | ) | (0.51 | ) | |||||||||||||
Net asset value, end of period | $ | 16.50 | $ | 15.66 | $ | 14.07 | $ | 12.79 | $ | 15.87 | $ | 17.95 | |||||||||||||
Total return | 10.75% | 13.01% | 12.77% | (12.75% | ) | (6.68% | ) | 19.71% | |||||||||||||||||
RATIOS/ SUPPLEMENTAL DATA: | |||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 16,502 | $ | 14,778 | $ | 13,021 | $ | 11,683 | $ | 13,690 | $ | 15,813 | |||||||||||||
Ratio of expenses to average net assets | 2.04% | 2.08% | 1.98% | 1.44% | 1.50% | 1.46% | |||||||||||||||||||
Ratio of net investment income (loss) to average net assets | (0.57% | ) | (0.76% | ) | (0.57% | ) | 0.25% | 0.34% | 0.20% | ||||||||||||||||
Portfolio turnover rate | 8.08% | 34.82% | 19.83% | 40.94% | 34.60% | 34.08% |
(1) | Other than the ratios of expenses and net investment income (loss) to average net assets, financial highlights have not been annualized. |
(2) | Per share information has been calculated using the average number of shares outstanding. |
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Note 1 — | Nature of Business and Significant Accounting Policies |
NATURE OF BUSINESS: |
SIGNIFICANT ACCOUNTING POLICIES: |
Use of Estimates |
Valuation of Securities |
Security Transactions and Investment Income |
Option Writing |
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Income Taxes |
Distributions to Shareholders |
Number of | Premiums | |||||||
Contracts | Received | |||||||
Contracts at September 30, 2003 | 35 | $ | 58,622 | |||||
Written | 1,055 | 537,900 | ||||||
Expired | (100 | ) | (9,100 | ) | ||||
Exercised | (150 | ) | (84,896 | ) | ||||
Closed | (800 | ) | (479,527 | ) | ||||
Contracts at September 30, 2004 | 40 | 22,999 | ||||||
Written | 471 | 249,743 | ||||||
Expired | — | — | ||||||
Exercised | — | — | ||||||
Closed | (461 | ) | (248,993 | ) | ||||
Contracts at March 31, 2005 | 50 | $ | 23,749 | |||||
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Six Months Ended | Year Ended | |||||||||||||||
March 31, 2005 | September 30, 2004 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold | 17,888 | $ | 292,200 | 23,845 | $ | 368,084 | ||||||||||
Shares issued in reinvestment of dividends | 48,445 | 787,233 | 14,285 | 214,427 | ||||||||||||
66,333 | 1,079,433 | 38,130 | 582,511 | |||||||||||||
Shares redeemed | 10,335 | 169,221 | 19,917 | 311,765 | ||||||||||||
Net increase | 55,998 | $ | 910,212 | 18,213 | $ | 270,746 | ||||||||||
Unrealized appreciation | $ | 5,655,990 | $ | 4,318,720 | ||||
Unrealized depreciation | (39,814 | ) | (120,636 | ) | ||||
Net unrealized appreciation | $ | 5,616,176 | $ | 4,198,084 | ||||
Note 6 — | Investment Advisory Fees and Other Transactions with Affiliates |
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• | Information we receive from you or in applications or other forms, correspondence, or conversations, including, but not limited to, your name, address, phone number, social security number, assets, income and date of birth; and |
• | Information about your transactions with us, our affiliates, or others, including, but not limited to, your account number and balance, payments history, parties to transactions, cost basis information, and other financial information. |
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INVESTMENT ADVISOR Concorde Investment Management 1500 Three Lincoln Centre 5430 LBJ Freeway Dallas, Texas 75240 OFFICERS Gary B. Wood, Ph.D. President and Treasurer John A. Stetter Secretary DIRECTORS John R. Bradford, Ph.D. John H. Wilson Gary B. Wood, Ph.D. CUSTODIAN U.S. Bank, N.A. 777 E. Wisconsin Avenue Milwaukee, Wisconsin 53202 TRANSFER AGENT AND DIVIDEND DISBURSING AGENT U.S. Bancorp Fund Services, LLC Mutual Fund Services, 3rd Floor 615 East Michigan Street Milwaukee, Wisconsin 53202 LEGAL COUNSEL Foley & Lardner 777 East Wisconsin Avenue Milwaukee, Wisconsin 53202 TELEPHONE (972) 404-1500 (Fund information) (800) 294-1699 (Shareholder account information) | A FAMILY OF NO-LOAD MUTUAL FUNDS SEMI-ANNUAL REPORT Dated March 31, 2005 |