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 811-05549
Reynolds Funds, Inc.
(Exact name of registrant as specified in charter)
c/o U.S. Bancorp Fund Services, LLC
615 E. Michigan Street
Milwaukee, WI 53202
(Address of principal executive offices) (Zip code)
Frederick L. Reynolds
Reynolds Capital Management, LLC
3565 South Las Vegas Blvd, #403
Las Vegas, NV 89109
(Name and address of agent for service)
(415) 265-7167
Registrant's telephone number, including area code:
Date of fiscal year end: September 30
Date of reporting period: September 30, 2012
Item 1. Reports to Stockholders.
ANNUAL REPORT
September 30, 2012
REYNOLDS BLUE CHIP GROWTH FUND Seeking Long-Term Capital Appreciation |
A No-Load Mutual Fund
1-800-773-9665
www.reynoldsfunds.com
REYNOLDS BLUE CHIP GROWTH FUND
November 23, 2012
Dear Fellow Shareholders:
Performance highlights (September 30, 2012)
The Reynolds Blue Chip Growth Fund has a 5 Star(1) overall rating from Morningstar. This is Morningstar’s highest overall mutual fund rating. The performance of the Reynolds Blue Chip Growth Fund (the “Fund” or the “Blue Chip Fund”) in the twelve months ended September 30, 2012 was +26.82%. The performance of the Standard & Poor’s 500 Index(2) during that same period was +30.20%. The annualized average total returns of the Reynolds Blue Chip Growth Fund for the 1-year, 3-year, 5-year and 10-year periods through September 30, 2012 were +26.82%, +12.09%, +13.11%, and +11.71%, respectively. The annualized average total returns for the Fund’s benchmark, the Standard & Poor’s 500, for the 1-year, 3-year, 5-year and 10-year periods through September 30, 2012 were +30.20%, +13.20%, +1.05%, and +8.01%, respectively. The performance of the Reynolds Blue Chip Growth Fund was +14.75% in the nine months ended September 30, 2012. The performance of the Standard & Poor’s 500 Index during that same period was +16.44%.
One Year | Three Year Average | Five Year Average | Ten Year Average | |||||
Returns | Annual Returns | Annual Returns | Annual Returns |
Reynolds Blue Chip Growth Fund | ||
Standard & Poor’s 500(2) | ||
(1) | The top 10% of all mutual funds in Morningstar’s universe of mutual funds are awarded a 5 Star Rating. This is out of 1,514 funds in Morningstar’s Large Growth Category which is the Fund’s Morningstar Category. The Overall Morningstar Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five-, and ten -year (if applicable) ratings, based on risk-adjusted returns. For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating™ based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund’s monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. Past performance is no guarantee of future results. |
(2) | The Standard & Poor’s 500 Index consists of 500 selected common stocks, most of which are listed on the New York Stock Exchange. The Standard & Poor’s Ratings Group designates the stocks to be included in the Index on a statistical basis. A particular stock’s weighting in the Index is based on its relative total market value (i.e. its market price per share times the number of shares outstanding.) Stocks may be added or deleted from the Index from time to time. |
Investment Strategy
We had an extremely high cash position in the Reynolds Blue Chip Growth Fund during the period from October 2007 to March 2009 when the stock market was in a correction phase. We started buying near the market bottom in March 2009. We believe that stocks are selling at attractive valuations based on historical valuation measures. One of these valuation measures is a company’s price earnings ratio relative to inflation, interest rates and the economic outlook. Another valuation measure is a company’s price earnings ratio relative to its forecasted earnings growth rate (the PEG ratio). Many stocks of high quality companies are currently selling at PE ratios and PEG ratios toward the lower end of their historical ranges and we believe that they are attractively valued.
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The U.S. Economy
The U.S. economic recovery that started in mid-2009 has continued, although at a modest pace, so far in 2012. The U.S. economic recovery continues to be affected by a number of secular factors that are altering the pace and composition of growth. The economy in 2012 is being affected by high unemployment, greater prudence and less speculation in lending, reduced government spending for the last eight straight quarters except for the most recent quarter, and weakness overseas. The U.S. economy is growing, but at a lower than ideal rate. For example, growth of 3% or better is needed to meaningfully reduce unemployment which is currently around 8%. The Federal Reserve Board’s (the Fed’s) second round of economic stimulus named “Operation Twist”, which involves purchasing longer term maturity Treasury Bonds and selling shorter term maturity Treasury Bonds, is continuing until December 31, 2012. This stimulus has tended to moderately lower longer term interest rates and added a moderate amount to economic growth. The Fed’s third round of economic stimulus named “QE3”, which involves purchasing $40 billion per month of open-ended mortgage-backed securities, has begun. U.S. Gross Domestic Product (GDP) expanded at a preliminary estimated inflation-adjusted annual rate of 2% in the quarter ended September 30, 2012 helped by a strong private sector including strong consumer spending, which accounted for most of the increase in GDP, and a surge in government spending. Many economists believe that the surge in government spending in the third quarter, which was led by defense spending, is only a temporary rebound from weak defense spending earlier in the year and will decline again as planned spending cuts take hold and lawmakers focus on trimming the nation’s deficit. The economy grew at a 1.3% rate in the second quarter and at a 2.0% rate in the first quarter. For the next six months the outlook remains for modest, but less than ideal growth, accompanied by high unemployment, modest inflation pressures, no change in the Federal Reserve policy on the federal funds rate, a strong private sector and a weak public sector. The economy will continue to be characterized by large fiscal deficits. GDP increased 1.8% in 2011 and 2.4% in 2010, after decreasing 3.6% in calendar 2009, after no change (0.0%) in calendar 2008, and increasing 2.1% in 2007. Only modest GDP gains are forecast for the next two years. The economy is more likely to slow than accelerate in the next coming months. U.S. GDP is forecast to expand at a 1.4% rate in the quarter ended December 31, 2012 and at 2.1% for the year ended December 31, 2012 and 1.6% for 2013.
U.S. inflation numbers have been helped in the last few years by global competition and technology innovations that are helping to lower production and distribution costs. Inflation, as measured by the Consumer Price Index, increased 3.1% in 2011 and 1.6% in 2010 after decreasing 0.3% in 2009, increasing 3.8% in 2008, and increasing 2.9% in 2007. U.S. inflation is estimated to have increased 1.6% in the third quarter of 2012, after increasing 1.9% and 2.8% in the second and first quarters of 2012, respectively. U.S. inflation is forecast to increase 2.1% in 2012 and 2.4% in 2013.
There are some current and potential economic and investment negatives at the present time including: (1) U.S. and worldwide economic growth has recently slowed; (2) a package of tax increases and cutbacks on government spending (“the fiscal cliff”) are set to automatically begin on January 1, 2013 unless Congress acts to avoid it; (3) unemployment at 7.9% is still high as hiring continues cautiously; (4) exports recently contracted for the first time in more than three years; (5) business spending has been weak as businesses are worried about slower growth; (6) many companies have recently reported disappointing sales and earnings and given profit warnings; (7) there are concerns about U.S. tax and spending policies; (8) mortgage rates are low, but mortgage credit is still somewhat tight; (9) the U.S. deficit needs to be reduced; (10) there are major economic problems with some individual Euro-zone countries such as Greece, Italy, Portugal, and Spain which may continue for some time; (11) Europe is in a recession; and (12) growth in China should remain below trend for the next couple years.
Some current and potential economic and investment positives are: (1) consumer spending, which accounts for about 71% of the economy, expanded in the most recent quarter at the fastest pace in the last year; (2) consumer sentiment is at a five year high; (3) residential investment rose for the sixth consecutive quarter as home sales are picking up along with residential construction; (4) employment and payrolls are increasing; (5) there has been recent growth in commercial construction; (6) there has been an increase in the willingness of companies to commit capital as evidenced by the increase in merger and acquisition activity; (7) the economy has grown in the last twelve quarters and growth should continue in the near term; (8) growth in the service sector is broadening; (9) manufacturing production is strong; (10) businesses have been able to use the credit markets to strengthen their balance sheets; (11) short-term interest rates remain low helped by a low Fed Funds rate; (12) long-term Treasury rates are low, (13) European bailout funds have been expanded; (14) current valuations of stocks are at the lower end of historical ranges; (15) the U.S. economy currently has better fundamentals than the economies of most other industrialized countries; and (16) China’s economic growth rate seems to be stabilizing.
The World Economy
The global economic recovery that started in mid-2009 has continued in 2012. Global economic activity slowed considerably in the last seven quarters. The World Economy increased 4.0% in 2011 and 4.8% in 2010 after decreasing 0.8% in 2009 and is forecast to increase
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2.7 % in 2012 and 2.8% in 2013. The Euro-zone is currently in a recession and is currently the weakest economic area among industrialized countries. Europe has been implementing significant fiscal retrenchment which is slowing their economic growth. The biggest risk to Euro-zone economic growth is related to the potential sovereign government debt crises that have appeared. The Euro-zone increased 1.5% in 2011 and 1.7% in 2010 after decreasing 4.0% in 2009. Euro-zone real GDP has decreased over the last four quarters. The Euro-zone is forecast to decrease 0.5% in 2012 and increase 0.6% in 2013. Several Euro-zone countries including Italy and Spain have slipped into a recession.
The United Kingdom’s GDP increased 0.7% in 2011 and 1.3% in 2010 after decreasing 4.9% in 2009 and is forecast to have 0.0% growth in 2012 and increase 1.2% in 2013. Recent data suggest that economic activity in the U.K. is starting to strengthen. Japan decreased 0.7% in 2011 and increased 4.0% in 2010 after decreasing 5.2% in 2009 and is forecast to increase 2.3% in 2012 and increase 1.0% in 2013. Korea increased 3.6% in 2011 and 6.2% in 2010 after increasing 0.2% in 2009 and is forecast to increase 2.3% in 2012 and 3.1% in 2013. Canada increased 2.5% in 2011 and 3.1% in 2010 after decreasing 2.6% in 2009 and is forecast to increase 1.9% in 2012 and 2.0% in 2013.
Some developing countries in the world have been growing faster than the U.S. in the last few years. Their economies continued to grow faster than the U.S. during the most recent worldwide economic slowdown and their economies are continuing to grow faster. Recovery is strongest in Asia with China having the strongest growth among “advanced economies”. Other Asian countries are having good growth rates as well. The biggest developing economies are many times referred to as the “BRIC” economy, which is short for Brazil, Russia, India, and China. China’s population is approximately 19% of the world’s total population of approximately seven billion. In the second quarter of 2010 China overtook Japan and became the world’s second largest economy after the U.S. It is the world’s fastest growing major economy. Many economists believe that China has a particularly good long-term outlook. Near term, however, there have been cross currents in China’s economic outlook and China’s growth rate has recently slowed to below 8%. GDP increased 6.4% in 2011 and 10.4% in 2010 after increasing 8.5% in 2009 and is forecast to increase 7.6% in 2012 and 7.8% in 2013.
India’s population is approximately 17% of the world’s population. It is the world’s second fastest growing major economy. India’s economy increased 6.6% in 2011 and 8.4% in 2010 after increasing 6.8% in 2009 and is forecast to increase 5.6% in 2012 and 6.1% in 2013.
Brazil is Latin America’s biggest economy. GDP increased 2.7% in 2011 and 7.5% in 2010 after decreasing 0.2% in 2009 and is forecast to increase 1.1% in 2012 and 3.0% in 2013. Russia’s economy grew at 4.3% in 2011 and 4.0% in 2010 after decreasing 7.9% in 2009 and is forecast to increase 3.3% in 2012 and 3.4% in 2013.
Many worldwide larger multinational companies should be well positioned to benefit long-term from worldwide growth. To the extent that some of these companies’ U.S. earnings are growing slower, this could be somewhat offset by their possible stronger foreign earnings. The long-term strategy of the Reynolds Blue Chip Growth Fund is to be structured to benefit from this worldwide growth by investing in many of these leading multinational growth companies.
The Blue Chip Fund is positioned to participate in long-term worldwide growth trends through investments in multinational U.S. headquartered companies. In addition, the Fund has investments in leading foreign headquartered companies, whose stocks or American Depositary Receipts (ADRs) trade in the United States. These ADRs are denominated in dollars and they must use GAAP (Generally Accepted Accounting Principles) accounting to qualify as an ADR. The Blue Chip Fund may hold up to 35% of its assets in ADRs.
Opportunistic Investing in Companies of Various Sizes and Diversified Among Various Industries
The Reynolds Blue Chip Growth Fund usually invests in companies of various sizes as classified by their market capitalizations. A company’s market capitalization is calculated by taking the number of shares the company has outstanding multiplied by its current market price. Other considerations in selecting companies for the Fund include revenue growth rates, product innovations, financial strength, management’s knowledge and experience plus the overall economic and geopolitical environments and interest rates. The Fund’s investments are diversified among various industries.
The long-term strategy of the Reynolds Blue Chip Growth Fund is to emphasize investment in worldwide “blue chip” growth companies. These companies are defined as companies with a minimum market capitalization of $1 billion. In the long-term these companies build value as their earnings grow. This growth in value should ultimately be recognized in higher stock prices for these companies.
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Industry Sectors(3) as of September 30, 2012
(3) | The Global Industry Classification Standard (“GICS®”) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC. |
Low Long-Term Interest Rates by Historical Standards are a Significant Positive for Stock Valuations
Long-term interest rates remain near historically low levels. Low long-term interest rates usually result in higher stock valuations for many reasons including:
(1) | Long-term borrowing costs of corporations are lower resulting in higher business confidence and profits. |
(2) | Long-term borrowing costs of individuals are lower which increases consumer confidence and spending. |
(3) | A company’s stock is usually valued by placing a present value on that company’s future stream of earnings and dividends. The present value is higher when interest and inflation rates are low. |
Linked Money Market Fund
The First American Treasury Obligations Fund is a money market fund offered by an affiliate of our transfer agent, U.S. Bancorp Fund Services, LLC. This Fund is offered as a money market alternative to our shareholders. The First American Treasury Obligations Fund offers many free shareholder conveniences including automatic investment and withdrawal plans and check writing access to your funds and is linked to your holdings in the Reynolds Blue Chip Growth Fund. This Fund is also included on your quarterly statements.
Information about the Reynolds Blue Chip Growth Fund and the First American Treasury Obligations Fund
Reynoldsfunds.com website: You can access current information about your investment holdings via our website, reynoldsfunds.com. You must first request a personal identification number (PIN) by calling our shareholder service representatives at 1-800-773-9665. You will be able to view your account list, account detail (including balances), transaction history, distributions, and the current Reynolds Blue Chip Growth Fund net asset value. Additional information available (PIN number not needed) includes quarterly updates of the returns of the Blue Chip Fund, top ten holdings and industry percentages. Also, detailed statistics and graphs of past performances from a link to Morningstar for the Blue Chip Fund.
For automatic current daily net asset values: Call 1-800-773-9665 (1-800-7REYNOLDS) twenty-four hours a day, seven days a week and press “any key” then “1”. The updated current net asset value for the Blue Chip Fund is usually available each business day after 5 P.M. (PST).
For the Reynolds Blue Chip Growth Fund shareholders to automatically access their current account information: Call 1-800-773-9665 (twenty-four hours a day, seven days a week), press “any key” then “2” and enter your 16 digit account number which appears at the top right of your statement.
To speak to a Fund representative regarding the current daily net asset value, current account information and any other questions: Call 1-800-773-9665 and press “0” from 6 A.M. to 5 P.M. (PST).
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Shareholder statement frequency: Consolidated statements summarizing the Blue Chip Fund and First American Treasury Obligations Fund accounts held by a shareholder are sent quarterly. In addition, individual Blue Chip Fund statements are sent whenever a transaction occurs. These transactions are: (1) statements are sent for the Blue Chip Fund or First American Treasury Obligations Fund when a shareholder purchases or redeems shares; (2) Blue Chip Fund statements are sent twice a year if, and when, any ordinary income or capital gains are distributed.
Tax reporting: Individual 1099 forms, which summarize any dividend income and any long- or short-term capital gains, are sent annually to shareholders each January. The percentage of income earned from various government securities, if any, for the Blue Chip Fund and the First American Treasury Obligations Fund are also reported in January.
Minimum investment: $1,000 for regular and retirement accounts ($100 for additional investments for all accounts – except for the Automatic Investment Plan, which is $50 for regular and retirement plan accounts).
Retirement plans: All types are offered including Traditional IRA, Roth IRA, Coverdell Education Savings Account, SIMPLE IRA Plan, and SEP IRA.
Automatic Investment Plan: There is no charge to automatically debit your checking account to invest in the Blue Chip Fund or the First American Treasury Obligations Fund ($50 minimum for either of these Funds) at periodic intervals to make automatic purchases in either of these Funds. This is useful for dollar cost averaging for the Blue Chip Fund.
Systematic Withdrawal Plan: For shareholders with a $10,000 minimum starting balance, there is no charge to automatically redeem shares ($100 minimum) in the Blue Chip Fund or the First American Treasury Obligations Fund as often as monthly and send a check to you or transfer funds to your bank account.
Free Check Writing: Free check writing ($100 minimum) is offered for accounts invested in the First American Treasury Obligations Fund.
Exchanges or regular redemptions between the Blue Chip Fund and the First American Treasury Obligations Fund: As often as desired – no charge.
NASDAQ symbols: Reynolds Blue Chip Growth Fund – RBCGX and First American Treasury Obligations Fund – FATXX.
Portfolio Manager: Frederick Reynolds is the portfolio manager of the Reynolds Blue Chip Growth Fund.
The Reynolds Blue Chip Growth Fund and the First American Treasury Obligations Fund are No-Load: No front-end sales commissions or deferred sales charges (“loads”) are charged. Over 40% of all mutual funds impose these marketing charges that are ultimately paid by the shareholder. These marketing charges are either: (1) a front-end fee or “load” in which up to 5% of a shareholder’s assets are deducted from the original investment (some funds even charge a fee when a shareholder reinvests capital gains or dividends); or (2) a back-end penalty fee or “load” which is typically deducted from a shareholder’s account if a shareholder redeems within five years of the original investment. These fees reduce a shareholder’s return. The Blue Chip Fund and First American Treasury Obligations Fund are No-Load as they do not have these extra charges.
Our Board of Directors has declared a distribution effective November 26, 2012 of $0.62743 per share from long-term capital gains, payable November 26, 2012 to shareholders of record on November 23, 2012.
We appreciate your continued confidence in the Reynolds Blue Chip Growth Fund and would like to welcome our new shareholders. We look forward to strong results in the future.
Sincerely,
Frederick L. Reynolds
President
This report is not authorized for use as an offer of sale or a solicitation of an offer to buy shares of the Reynolds Blue Chip Growth Fund unless accompanied or preceded by the Fund’s current prospectus. Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by visiting www.reynoldsfunds.com.
This shareholder letter is unaudited.
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Reynolds Blue Chip Growth Fund
COST DISCUSSION (Unaudited)
As a shareholder of the Reynolds Blue Chip Growth Fund, you do not incur (except as described below) transaction costs, including sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees, but do incur ongoing costs, including management fees; distribution [and/or service] (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from April 1, 2012 through September 30, 2012.
Actual Expenses
The first line of the table below provides information about actual account values and actual expenses. 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.
In addition to the costs highlighted and described below, the only Fund transaction costs you might currently incur would be wire fees ($15 per wire), if you choose to have proceeds from a redemption wired to your bank account instead of receiving a check. Additionally, U.S. Bank charges an annual processing fee ($15) if you maintain an IRA account with the Fund. To determine your total costs of investing in the Fund, you would need to add any applicable wire or IRA processing fees you’ve incurred during the period to the costs provided in the example below.
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 ratio 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 or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account | Ending Account | Expenses Paid During | |
Value 4/01/12 | Value 9/30/12 | Period* 4/01/12-9/30/12 | |
Reynolds Blue Chip Growth Fund Actual | $1,000.00 | $ 990.10 | $7.51 |
Hypothetical (5% return before expenses) | $1,000.00 | $1,017.40 | $7.62 |
* | Expenses are equal to the Fund’s annualized expense ratio of 1.51% multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period between April 1, 2012 and September 30, 2012). |
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Reynolds Blue Chip Growth FundMANAGEMENT’S DISCUSSION OF FUND PERFORMANCE (Unaudited)
MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE (Unaudited)
The Reynolds Blue Chip Growth Fund and the Standard & Poor’s 500 Index both appreciated strongly for the six month period ended March 31, 2012. The Blue Chip Fund’s performance was +28.09% and the S&P 500’s performance was +25.89% during this period. This strong appreciation for both the Fund and the S&P 500 was due to several reasons including: (1) interest rates were at historically low levels; (2) the continued positive effects of the stimulus program; (3) Gross Domestic Product (GDP) and corporate profits increased during this period; (4) the consensus economic forecast was for continued moderate growth; and (5) the stock market and many individual stocks in the Fund were particularly good value. The Reynolds Blue Chip Growth Fund outperformed the Standard & Poor’s 500 Index (the Fund’s benchmark) during this period. One reason for the Fund’s strong performance was that many of the Fund’s largest holdings outperformed the benchmark. Some of these largest holdings were: (1) Apple; (2) Cerner; (3) Dollar Tree; (4) Google; (5) Home Depot; (6) Macy’s; (7) Nordstrom; (8) O’Reilly Automotive; (9) Peet’s Coffee and Tea; (10) Pier One; (11) Priceline; (12) Qualcomm; (13) Ross Stores; (14) TJX; (15) Tractor Supply; (16) Ultimate Software; and (17) Whole Foods Market. In addition, good individual stock selection in general was an important contributor to this good performance. Examples were: (1) Amazon; (2) CBS; (3) Chipotle Mexican Grill; (4) Citrix Systems; (5) Costco; (6) Diageo; (7) F5 Networks; (8) Hain Celestial; (9) Hubbell; (10) Lowes; (11) Lululemon Athletica; (12) Mastercard; (13) Monsanto; (14) PVH; (15) Temper-Pedic; (16) Union Pacific; and (17) Visa.
In the second half of the Blue Chip Fund’s fiscal year ended September 30, 2012 the Standard & Poor’s 500 Index was up 3.43% and the Fund was down 0.99%. Some reasons for this flattish period in the S&P 500 and in the Fund were: (1) the second stimulus program did not help the economy very much in general and the stimulus program was coming to an end; (2) near term GDP and some industry and company forecasts were lowered; (3) heightened concern about European sovereign debt problems; (4) increased concern about other Euro-zone problems; and (5) China’s near term economic growth estimates were lowered several times. The main reason for the Fund’s underperformance was that many of the same stocks held in the Fund that outperformed the benchmark in the first half underperformed the benchmark in the second half. Most of these companies that outperformed the benchmark in the first half are high quality growth companies whose earnings are growing faster than the overall market. As a result, more is expected of these companies. They can be more volatile than the market during flattish and correction periods and they were during this period.
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN REYNOLDS BLUE CHIP GROWTH FUND AND S&P 500 INDEX(1) | ||
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. | ||
AVERAGE ANNUAL TOTAL RETURN | ||
1-YEAR | 5-YEAR | 10-YEAR |
26.82% | 13.11% | 11.71% |
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Reynolds Blue Chip Growth Fund
STATEMENT OF ASSETS AND LIABILITIES
September 30, 2012
ASSETS: | ||||
Investments in securities, at value (cost $158,144,373) | $ | 183,342,119 | ||
Cash | 1,391,350 | |||
Receivable from investments sold | 2,787,396 | |||
Receivable from shareholders for purchases | 349,723 | |||
Dividends receivable | 138,169 | |||
Prepaid expenses | 48,568 | |||
Other receivables | 238 | |||
Total assets | $ | 188,057,563 | ||
LIABILITIES: | ||||
Payable for investments purchased | $ | 1,550,289 | ||
Payable to shareholders for redemptions | 189,767 | |||
Payable to adviser for management fees | 154,135 | |||
Payable for distribution expenses | 12,538 | |||
Other liabilities | 78,096 | |||
Total liabilities | 1,984,825 | |||
NET ASSETS: | ||||
Capital Stock, $0.01 par value; 40,000,000 shares authorized; 3,155,396 shares outstanding | 164,442,964 | |||
Net unrealized appreciation on investments | 25,197,746 | |||
Accumulated net realized loss on investments | (2,944,659 | ) | ||
Accumulated net investment loss | (623,313 | ) | ||
Net assets | 186,072,738 | |||
Total liabilities and net assets | $ | 188,057,563 | ||
CALCULATION OF NET ASSET VALUE PER SHARE: | ||||
Net asset value, offering and redemption price per share ($186,072,738 ÷ 3,155,396 shares outstanding) | $ | 58.97 |
The accompanying notes to financial statements are an integral part of this statement.
SCHEDULE OF INVESTMENTS
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) | |||||||
COMMON STOCKS — 97.0% (a) | |||||||
Aerospace & Defense — 0.8% | |||||||
1,700 | BE Aerospace, Inc.* | $ | 71,570 | ||||
2,000 | The Boeing Co. | 139,240 | |||||
4,100 | Hexcel Corp.* | 98,482 | |||||
4,900 | Honeywell International Inc. | 292,775 | |||||
1,100 | Northrop Grumman Corporation | 73,073 | |||||
600 | Precision Castparts Corp. | 98,004 | |||||
1,400 | Raytheon Co. | 80,024 | |||||
1,700 | Rockwell Collins, Inc. | 91,188 | |||||
1,900 | Spirit AeroSystems Holdings Inc.* | 42,199 | |||||
4,200 | Triumph Group, Inc. | 262,626 | |||||
3,900 | United Technologies Corp. | 305,331 | |||||
1,554,512 | |||||||
Air Freight & Logistics — 0.1% | |||||||
2,200 | C. H. Robinson Worldwide, Inc. | 128,810 | |||||
Airlines — 0.5% | |||||||
3,600 | Alaska Air Group, Inc.* | 126,216 | |||||
4,900 | Allegiant Travel Co.* | 310,464 |
The accompanying notes to financial statements are an integral part of this schedule.
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Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Airlines — 0.5% (Continued) | |||||||
4,000 | Delta Air Lines, Inc.* | $ | 36,640 | ||||
20,000 | Hawaiian Holdings, Inc.* | 111,800 | |||||
3,600 | JetBlue Airways Corp.* | 17,244 | |||||
1,100 | Ryanair Holdings PLC - SP-ADR* | 35,475 | |||||
2,600 | Spirit Airlines Inc.* | 44,408 | |||||
17,100 | US Airways Group, Inc.* | 178,866 | |||||
861,113 | |||||||
Auto Components — 0.3% | |||||||
2,600 | BorgWarner, Inc.* | 179,686 | |||||
2,000 | The Goodyear Tire & | ||||||
Rubber Company* | 24,380 | ||||||
2,600 | Johnson Controls, Inc. | 71,240 | |||||
1,200 | Tenneco Inc.* | 33,600 | |||||
3,700 | TRW Automotive Holdings Corp.* | 161,727 | |||||
470,633 | |||||||
Automobiles — 0.1% | |||||||
600 | Harley-Davidson, Inc. | 25,422 | |||||
2,100 | Tata Motors Ltd. - SP-ADR | 53,928 | |||||
600 | Tesla Motors, Inc.* | 17,568 | |||||
800 | Winnebago Industries, Inc.* | 10,104 | |||||
107,022 | |||||||
Beverages — 2.0% | |||||||
2,900 | Anheuser-Busch | ||||||
InBev N.V. - SP-ADR | 249,139 | ||||||
2,200 | The Boston Beer Company, Inc.* | 246,334 | |||||
9,000 | Coca-Cola Enterprises Inc. | 281,430 | |||||
4,800 | Coca-Cola Femsa, S.A.B. | ||||||
de C.V. - SP-ADR | 619,200 | ||||||
17,300 | Constellation Brands, Inc.* | 559,655 | |||||
9,400 | Cott Corp.* | 74,260 | |||||
7,800 | Diageo plc - SP-ADR | 879,294 | |||||
4,100 | Dr Pepper Snapple Group, Inc. | 182,573 | |||||
2,100 | Fomento Economico Mexicano, | ||||||
S.A.B. de C.V. - SP-ADR | 193,158 | ||||||
300 | Monster Beverage Corporation* | 16,248 | |||||
6,100 | PepsiCo, Inc. | 431,697 | |||||
3,732,988 | |||||||
Biotechnology — 3.5% | |||||||
1,900 | ACADIA Pharmaceuticals Inc.* | 4,807 | |||||
6,700 | Affymax Inc.* | 141,102 | |||||
6,500 | Alexion Pharmaceuticals, Inc.* | 743,600 | |||||
3,900 | Alkermes PLC*^ | 80,925 | |||||
3,000 | Amgen Inc. | 252,960 | |||||
13,700 | Arena Pharmaceuticals, Inc.* | 113,984 | |||||
39,600 | ARIAD Pharmaceuticals, Inc.* | 959,310 | |||||
5,800 | BioCryst Pharmaceuticals, Inc.* | 24,592 | |||||
2,800 | Biogen Idec Inc.* | 417,844 | |||||
3,900 | BioMarin Pharmaceutical Inc.* | 157,053 | |||||
5,600 | Celgene Corp.* | 427,840 | |||||
700 | Cubist Pharmaceuticals, Inc.* | 33,376 | |||||
12,900 | Dendreon Corp.* | 62,307 | |||||
6,000 | Geron Corporation* | 10,200 | |||||
10,600 | Gilead Sciences, Inc.* | 703,098 | |||||
500 | Hemispherx Biopharma, Inc.* | 400 | |||||
18,900 | Incyte Corp.* | 341,145 | |||||
6,400 | Isis Pharmaceuticals, Inc.* | 90,048 | |||||
6,200 | Medivation Inc.* | 349,432 | |||||
700 | Onyx Pharmaceuticals, Inc.* | 59,150 | |||||
12,500 | Orexigen Therapeutics Inc.* | 71,375 | |||||
13,500 | Pharmacyclics, Inc.* | 870,750 | |||||
600 | Regeneron Pharmaceuticals, Inc.* | 91,596 | |||||
1,400 | Sarepta Therapeutics, Inc.* | 21,742 | |||||
12,400 | Savient Pharmaceuticals Inc.* | 30,876 | |||||
6,300 | Seattle Genetics, Inc.* | 169,785 | |||||
7,900 | Threshold Pharmaceuticals Inc.* | 57,196 | |||||
4,200 | United Therapeutics Corporation* | 234,696 | |||||
7,300 | Vical Inc.* | 31,536 | |||||
6,552,725 | |||||||
Building Products — 0.4% | |||||||
13,800 | Fortune Brands Home | ||||||
& Security Inc.* | 372,738 | ||||||
400 | Lennox International Inc. | 19,344 | |||||
9,000 | Masco Corp. | 135,450 | |||||
4,100 | Owens Corning Inc.* | 137,186 | |||||
7,000 | USG Corporation* | 153,650 | |||||
818,368 |
The accompanying notes to financial statements are an integral part of this schedule.
- 9 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Capital Markets — 1.1% | |||||||
1,400 | Affiliated Managers Group, Inc.* | $ | 172,200 | ||||
700 | Ameriprise Financial, Inc. | 39,683 | |||||
1,800 | The Carlyle Group | 47,232 | |||||
4,800 | E*Trade Financial Corp.* | 42,288 | |||||
1,900 | Financial Engines, Inc.* | 45,277 | |||||
900 | Franklin Resources, Inc. | 112,563 | |||||
4,900 | The Goldman Sachs Group, Inc. | 557,032 | |||||
1,200 | Invesco Limited | 29,988 | |||||
9,500 | Janus Capital Group Inc. | 89,680 | |||||
1,700 | Jefferies Group, Inc. | 23,273 | |||||
2,700 | Legg Mason, Inc. | 66,636 | |||||
5,500 | Morgan Stanley | 92,070 | |||||
1,000 | Northern Trust Corporation | 46,415 | |||||
4,700 | Piper Jaffray Companies, Inc.* | 119,615 | |||||
400 | T. Rowe Price Group Inc. | 25,320 | |||||
4,300 | Raymond James Financial, Inc. | 157,595 | |||||
1,000 | Safeguard Scientifics, Inc.* | 15,690 | |||||
3,800 | SEI Investments Co. | 81,510 | |||||
4,700 | TD Ameritrade Holding Corp. | 72,239 | |||||
2,000 | Virtus Investment Partners Inc.* | 172,000 | |||||
2,100 | Waddell & Reed Financial, Inc. | 68,817 | |||||
2,077,123 | |||||||
Chemicals — 3.1% | |||||||
4,200 | Agrium Inc. | 434,532 | |||||
900 | Bayer AG - SP-ADR | 77,301 | |||||
1,400 | Cytec Industries Inc. | 91,728 | |||||
6,444 | Eastman Chemical Co. | 367,373 | |||||
1,600 | Ecolab Inc. | 103,696 | |||||
8,000 | Ferro Corporation* | 27,440 | |||||
9,400 | FMC Corporation | 520,572 | |||||
5,000 | W.R. Grace & Co.* | 295,400 | |||||
6,100 | Huntsman Corporation | 91,073 | |||||
4,500 | International Flavors & | ||||||
Fragrances Inc. | 268,110 | ||||||
4,200 | Koppers Holdings, Inc. | 146,706 | |||||
5,500 | Kraton Performance Polymers, Inc.* | 143,550 | |||||
9,800 | LyondellBasell Industries N.V. | 506,268 | |||||
8,800 | Monsanto Company | 800,976 | |||||
4,400 | The Mosaic Company | 253,484 | |||||
300 | NewMarket Corporation | 73,944 | |||||
7,700 | Olin Corp. | 167,321 | |||||
2,400 | Potash Corporation | ||||||
of Saskatchewan Inc. | 104,208 | ||||||
2,500 | PPG Industries, Inc. | 287,100 | |||||
7,100 | RPM International, Inc. | 202,634 | |||||
700 | The Scotts Miracle-Gro Company | 30,429 | |||||
3,800 | Sigma-Aldrich Corp. | 273,486 | |||||
500 | Sociedad Quimica y Minera | ||||||
de Chile S.A. - SP-ADR | 30,820 | ||||||
500 | Stepan Company | 48,060 | |||||
500 | Syngenta AG - ADR | 37,425 | |||||
6,200 | The Valspar Corp. | 347,820 | |||||
5,731,456 | |||||||
Commercial Banks — 1.2% | |||||||
400 | Bank of the Ozarks, Inc. | 13,788 | |||||
4,600 | Barclays PLC - SP-ADR | 63,802 | |||||
5,300 | BB&T Corp. | 175,748 | |||||
10,400 | Citizens Republic Bancorp, Inc.* | 201,240 | |||||
5,700 | East West Bancorp, Inc. | 120,384 | |||||
22,400 | Fifth Third Bancorp | 347,424 | |||||
18,500 | Huntington Bancshares Inc. | 127,650 | |||||
6,200 | KeyCorp | 54,188 | |||||
1,900 | Mercantile Bank Corporation* | 32,566 | |||||
300 | PNC Financial Services Group, Inc. | 18,930 | |||||
30,500 | Regions Financial Corp. | 219,905 | |||||
11,900 | SunTrust Banks, Inc. | 336,413 | |||||
5,000 | Synovus Financial Corp. | 11,850 | |||||
4,400 | Texas Capital Bancshares, Inc.* | 218,724 | |||||
500 | The Toronto-Dominion Bank | 41,670 | |||||
2,600 | U.S. Bancorp | 89,180 | |||||
2,200 | Wells Fargo & Co. | 75,966 | |||||
3,300 | Zions Bancorporation | 68,161 | |||||
2,217,589 | |||||||
Commercial Services & Supplies — 0.8% | |||||||
5,100 | Cintas Corp. | 211,395 | |||||
1,400 | Consolidated Graphics, Inc.* | 36,526 | |||||
10,700 | Copart, Inc.* | 296,711 | |||||
4,700 | Corrections Corporation of America | 157,215 | |||||
9,500 | A.T. Cross Company* | 94,715 | |||||
1,900 | The Geo Group Inc. | 52,573 |
The accompanying notes to financial statements are an integral part of this schedule.
- 10 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Commercial Services & Supplies — 0.8% (Continued) | |||||||
5,900 | KAR Auction Services Inc.* | $ | 116,466 | ||||
3,900 | Manpower, Inc. | 143,520 | |||||
3,200 | Herman Miller, Inc. | 62,208 | |||||
800 | PHH Corporation* | 16,280 | |||||
13,400 | RINO International Corp.* | 402 | |||||
12,600 | Rollins, Inc. | 294,714 | |||||
600 | Waste Connections, Inc. | 18,150 | |||||
1,500,875 | |||||||
Communications Equipment — 2.5% | |||||||
5,600 | Acme Packet, Inc.* | 95,760 | |||||
7,000 | Aruba Networks Inc.* | 157,395 | |||||
10,500 | Brocade Communications | ||||||
Systems, Inc.* | 62,107 | ||||||
25,400 | Ciena Corp.* | 345,440 | |||||
2,900 | Cisco Systems, Inc. | 55,361 | |||||
4,400 | F5 Networks, Inc.* | 460,680 | |||||
12,500 | Finisar Corp.* | 178,750 | |||||
6,800 | Harris Corp. | 348,296 | |||||
1,000 | InterDigital, Inc. | 37,280 | |||||
2,900 | Ituran Location and Control Ltd. | 33,814 | |||||
16,500 | JDS Uniphase Corp.* | 204,353 | |||||
2,500 | Juniper Networks, Inc.* | 42,775 | |||||
1,820 | Loral Space & Communications Inc. | 129,402 | |||||
7,700 | NETGEAR, Inc.* | 293,678 | |||||
14,500 | Nokia Oyj - SP-ADR | 37,265 | |||||
2,500 | Plantronics, Inc. | 88,325 | |||||
8,000 | Procera Networks, Inc.* | 188,000 | |||||
18,800 | QUALCOMM, Inc. | 1,174,812 | |||||
2,700 | RADWARE Ltd.* | 97,254 | |||||
4,100 | Research In Motion Limited* | 30,750 | |||||
12,100 | Riverbed Technology, Inc.* | 281,567 | |||||
12,800 | Telefonaktiebolaget | ||||||
LM Ericsson - SP-ADR | 116,864 | ||||||
7,600 | Ubiquiti Networks Inc.* | 90,440 | |||||
3,400 | ViaSat, Inc.* | 127,092 | |||||
4,677,460 | |||||||
Computers & Peripherals — 8.5% | |||||||
20,950 | Apple Inc. | 13,979,097 | |||||
17,200 | EMC Corp.* | 469,044 | |||||
3,400 | Fusion-io Inc.* | 102,918 | |||||
1,100 | International Business | ||||||
Machines Corp. | 228,195 | ||||||
1,100 | Lexmark International, Inc. | 24,475 | |||||
1,900 | Logitech International S.A.* | 17,385 | |||||
7,200 | NetApp, Inc.* | 236,736 | |||||
5,200 | QLogic Corp.* | 59,384 | |||||
6,700 | SanDisk Corp.* | 290,981 | |||||
2,700 | Seagate Technology PLC | 83,700 | |||||
1,600 | Silicon Graphics | ||||||
International Corporation* | 14,560 | ||||||
2,800 | Teradata Corp.* | 211,148 | |||||
700 | Western Digital Corp. | 27,111 | |||||
15,744,734 | |||||||
Construction & Engineering — 0.5% | |||||||
4,400 | Chicago Bridge & Iron | ||||||
Company N. V. NYS | 167,596 | ||||||
5,700 | Fluor Corp. | 320,796 | |||||
4,000 | Foster Wheeler AG* | 95,840 | |||||
5,300 | Jacobs Engineering Group Inc.* | 214,279 | |||||
1,200 | The Shaw Group Inc.* | 52,344 | |||||
850,855 | |||||||
Construction Materials — 0.0% | |||||||
1,400 | Vulcan Materials Company | 66,220 | |||||
Consumer Finance — 0.4% | |||||||
1,400 | American Express Co. | 79,604 | |||||
2,500 | Capital One Financial Corp. | 142,525 | |||||
14,600 | Discover Financial Services | 580,058 | |||||
802,187 | |||||||
Consumer Services – Diversified — 0.1% | |||||||
1,400 | Coinstar, Inc.* | 62,972 | |||||
1,000 | Sotheby’s | 31,500 | |||||
94,472 | |||||||
Containers & Packaging — 0.5% | |||||||
4,100 | Ball Corp. | 173,471 | |||||
25,500 | Boise, Inc. | 223,380 | |||||
4,100 | Crown Holdings, Inc.* | 150,675 | |||||
1,200 | Owens-Illinois, Inc.* | 22,512 | |||||
3,100 | Packaging Corp of America | 112,530 |
The accompanying notes to financial statements are an integral part of this schedule.
- 11 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Containers & Packaging — 0.5% (Continued) | |||||||
500 | Rock-Tenn Company | $ | 36,090 | ||||
1,700 | Sealed Air Corporation | 26,282 | |||||
744,940 | |||||||
Distributors — 0.0% | |||||||
1,400 | Genuine Parts Co. | 85,442 | |||||
Electrical Equipment — 1.0% | |||||||
2,500 | The Babcock & Wilcox Co.* | 63,675 | |||||
2,400 | Cooper Industries PLC | 180,144 | |||||
5,300 | Emerson Electric Co. | 255,831 | |||||
8,100 | Hubbell Incorporated Cl B | 653,994 | |||||
800 | Regal-Beloit Corporation | 56,384 | |||||
2,200 | Roper Industries, Inc. | 241,758 | |||||
2,710 | Sensata Technologies Holding N.V.* | 80,677 | |||||
3,900 | A.O. Smith Corp. | 224,406 | |||||
1,756,869 | |||||||
Electronic Equipment, Instruments | |||||||
& Components — 0.8% | |||||||
3,100 | Agilent Technologies, Inc. | 119,195 | |||||
1,000 | Amphenol Corporation | 58,880 | |||||
1,200 | Coherent, Inc.* | 55,032 | |||||
5,700 | InvenSense Inc.* | 68,115 | |||||
1,000 | Itron, Inc.* | 43,150 | |||||
6,500 | Jabil Circuit, Inc. | 121,680 | |||||
1,500 | Littelfuse, Inc. | 84,810 | |||||
3,800 | Molex Inc. | 99,864 | |||||
8,000 | Nam Tai Electronics, Inc. | 85,760 | |||||
5,800 | OSI Systems, Inc.* | 451,472 | |||||
8,900 | Sanmina-SCI Corp.* | 75,561 | |||||
2,000 | Tech Data Corp.* | 90,600 | |||||
3,400 | Trimble Navigation Ltd.* | 162,044 | |||||
1,516,163 | |||||||
Energy Equipment & Services — 2.0% | |||||||
1,200 | Atwood Oceanics, Inc.* | 54,540 | |||||
2,300 | Baker Hughes Inc. | 104,029 | |||||
4,400 | Cameron International Corp.* | 246,708 | |||||
12,700 | CGG-Veritas - SP-ADR* | 417,195 | |||||
3,600 | Diamond Offshore Drilling, Inc. | 236,916 | |||||
3,300 | Dresser-Rand Group, Inc.* | 181,863 | |||||
900 | Ensco PLC | 49,104 | |||||
7,000 | FMC Technologies, Inc.* | 324,100 | |||||
3,100 | Halliburton Co. | 104,439 | |||||
1,200 | Helmerich & Payne, Inc. | 57,132 | |||||
2,800 | Hercules Offshore, Inc.* | 13,664 | |||||
3,800 | Lufkin Industries, Inc. | 204,516 | |||||
6,600 | Nabors Industries Ltd.* | 92,598 | |||||
5,400 | National-Oilwell Varco Inc. | 432,594 | |||||
3,200 | Newpark Resources, Inc.* | 23,712 | |||||
1,000 | Noble Corporation | 35,780 | |||||
2,600 | Oceaneering International, Inc. | 143,650 | |||||
2,600 | Oil States International, Inc.* | 206,596 | |||||
13,900 | Parker Drilling Co.* | 58,797 | |||||
400 | Precision Drilling Corporation* | 3,136 | |||||
7,300 | Rowan Companies plc* | 246,521 | |||||
3,200 | Schlumberger Ltd. | 231,456 | |||||
1,000 | Seadrill Ltd. | 39,220 | |||||
3,600 | Tenaris S.A. - ADR | 146,772 | |||||
1,600 | Transocean Ltd. | 71,824 | |||||
3,726,862 | |||||||
Financial Services – Diversified — 0.5% | |||||||
23,700 | Bank of America Corp. | 209,271 | |||||
3,700 | Citigroup Inc. | 121,064 | |||||
2,000 | CME Group Inc. | 114,600 | |||||
2,800 | JPMorgan Chase & Co. | 113,344 | |||||
1,500 | KKR Financial Holdings LLC | 15,075 | |||||
5,800 | Leucadia National Corporation | 131,950 | |||||
1,400 | Moody’s Corporation | 61,838 | |||||
14,100 | NewStar Financial, Inc.* | 169,059 | |||||
936,201 | |||||||
Food & Staples Retailing — 1.7% | |||||||
8,300 | Costco Wholesale Corp. | 831,037 | |||||
400 | CVS Caremark Corporation | 19,368 | |||||
400 | The Fresh Market, Inc.* | 23,992 | |||||
9,900 | PriceSmart, Inc. | 749,628 | |||||
10,000 | United Natural Foods, Inc.* | 584,500 | |||||
2,900 | Wal-Mart Stores, Inc. | 214,020 | |||||
7,500 | Whole Foods Market, Inc. | 730,500 | |||||
3,153,045 |
The accompanying notes to financial statements are an integral part of this schedule.
- 12 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Food Products — 1.1% | |||||||
600 | Annie’s, Inc.* | $ | 26,904 | ||||
5,400 | B & G Foods Inc. | 163,674 | |||||
1,000 | Campbell Soup Company | 34,820 | |||||
1,800 | Dean Foods Company* | 29,430 | |||||
700 | Dole Food Company, Inc.* | 9,821 | |||||
3,300 | Green Mountain Coffee Roasters, Inc.* | 78,375 | |||||
3,300 | The Hain Celestial Group, Inc.* | 207,900 | |||||
600 | H.J. Heinz Company | 33,570 | |||||
1,100 | The Hershey Company | 77,979 | |||||
5,900 | Inventure Foods, Inc.* | 33,571 | |||||
800 | Kellogg Company | 41,328 | |||||
7,400 | McCormick & Company, Inc. | 459,096 | |||||
2,100 | Mead Johnson Nutrition Company | 153,888 | |||||
1,600 | Ralcorp Holdings, Inc.* | 116,800 | |||||
6,500 | The J.M. Smucker Co. | 561,145 | |||||
2,300 | SunOpta Inc.* | 14,697 | |||||
1,300 | Unilever PLC-SP-ADR | 46,124 | |||||
2,089,122 | |||||||
Gas Utilities — 0.0% | |||||||
1,600 | ONEOK, Inc. | 77,296 | |||||
Health Care Equipment & Supplies — 2.3% | |||||||
2,100 | Align Technology, Inc.* | 77,637 | |||||
2,000 | C.R. Bard, Inc. | 209,300 | |||||
1,600 | Baxter International Inc. | 96,416 | |||||
600 | Becton, Dickinson and Company | 47,136 | |||||
2,200 | Covidien PLC | 130,724 | |||||
2,200 | Cyberonics, Inc.* | 115,324 | |||||
1,200 | DENTSPLY International Inc. | 45,768 | |||||
4,600 | Edwards Lifesciences Corp.* | 493,902 | |||||
6,000 | Endologix, Inc.* | 82,920 | |||||
8,000 | Haemonetics Corporation* | 641,600 | |||||
4,200 | Hologic, Inc.* | 85,008 | |||||
1,100 | ICU Medical, Inc.* | 66,528 | |||||
4,500 | IDEXX Laboratories, Inc.* | 447,075 | |||||
600 | Intuitive Surgical, Inc.* | 297,378 | |||||
4,700 | MAKO Surgical Corp.* | 81,827 | |||||
4,900 | Medtronic, Inc. | 211,288 | |||||
1,800 | Sirona Dental Systems, Inc.* | 102,528 | |||||
17,400 | The Spectranetics Corporation* | 256,650 | |||||
1,800 | St. Jude Medical, Inc. | 75,834 | |||||
5,400 | Stryker Corp. | 300,564 | |||||
7,000 | Varian Medical Systems, Inc.* | 422,240 | |||||
4,287,647 | |||||||
Health Care Providers & Services — 1.9% | |||||||
700 | Aetna Inc. | 27,720 | |||||
1,100 | Air Methods Corporation* | 131,307 | |||||
3,800 | AMN Healthcare Services, Inc.* | 38,228 | |||||
1,600 | Centene Corporation* | 59,856 | |||||
1,500 | CIGNA Corp. | 70,755 | |||||
3,100 | Community Health Systems Inc.* | 90,334 | |||||
6,820 | Express Scripts Holding Company* | 427,409 | |||||
7,500 | Fresenius Medical Care | ||||||
AG & Co. KGaA - ADR | 550,500 | ||||||
18,200 | Health Management | ||||||
Associates, Inc.* | 152,698 | ||||||
1,700 | Health Net Inc.* | 38,267 | |||||
1,400 | HEALTHSOUTH Corp.* | 33,684 | |||||
3,700 | Humana Inc. | 259,555 | |||||
700 | Laboratory Corporation | ||||||
of America Holdings* | 64,729 | ||||||
600 | Magellan Health Services, Inc.* | 30,966 | |||||
2,500 | McKesson Corp. | 215,075 | |||||
12,100 | Molina Healthcare Inc.* | 304,315 | |||||
600 | MWI Veterinary Supply, Inc.* | 64,008 | |||||
6,400 | Patterson Companies Inc. | 219,136 | |||||
1,600 | Quest Diagnostics Inc. | 101,488 | |||||
3,700 | Henry Schein, Inc.* | 293,299 | |||||
21,200 | Tenet Healthcare Corp.* | 132,924 | |||||
2,200 | UnitedHealth Group Inc. | 121,902 | |||||
3,428,155 | |||||||
Health Care Technology — 0.6% | |||||||
2,700 | Allscripts Healthcare Solutions, Inc.* | 33,561 | |||||
5,200 | athenahealth Inc.* | 477,204 | |||||
5,800 | Cerner Corp.* | 448,978 | |||||
4,000 | HealthStream, Inc.* | 113,840 | |||||
1,800 | Omnicell, Inc.* | 25,020 | |||||
1,098,603 |
The accompanying notes to financial statements are an integral part of this schedule.
- 13 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Home Building — 1.2% | |||||||
9,800 | Beazer Homes USA, Inc.* | $ | 34,790 | ||||
9,600 | D.R. Horton, Inc. | 198,144 | |||||
3,000 | Gafisa S.A. - ADR* | 13,110 | |||||
19,400 | Hovnanian Enterprises, Inc. Cl A* | 67,124 | |||||
11,300 | KB Home | 162,155 | |||||
16,000 | Lennar Corp. | 556,320 | |||||
900 | Meritage Homes Corporation* | 34,227 | |||||
26,400 | Pulte Group Inc.* | 409,200 | |||||
7,800 | The Ryland Group, Inc. | 234,000 | |||||
17,900 | Standard Pacific Corp.* | 121,004 | |||||
10,800 | Toll Brothers, Inc.* | 358,884 | |||||
2,188,958 | |||||||
Hotels, Restaurants & Leisure — 5.2% | |||||||
400 | Bloomin’ Brands Inc.* | 6,580 | |||||
8,450 | Boyd Gaming Corp.* | 59,657 | |||||
11,900 | Brinker International, Inc. | 420,070 | |||||
1,700 | Buffalo Wild Wings Inc.* | 145,758 | |||||
11,600 | Caribou Coffee Company, Inc.* | 159,268 | |||||
2,100 | Carnival Corp. | 76,524 | |||||
4,400 | The Cheesecake Factory Inc. | 157,300 | |||||
2,100 | Chipotle Mexican Grill, Inc.* | 666,834 | |||||
1,500 | Choice Hotels International, Inc. | 47,985 | |||||
3,800 | Cracker Barrel Old | ||||||
Country Store, Inc. | 255,018 | ||||||
7,300 | Ctrip.com International, Ltd. - ADR* | 123,224 | |||||
7,000 | Darden Restaurants, Inc. | 390,250 | |||||
9,800 | Denny’s Corp.* | 47,530 | |||||
1,900 | DineEquity, Inc.* | 106,400 | |||||
10,700 | Domino’s Pizza, Inc. | 403,390 | |||||
2,400 | Dunkin’ Brands Group Inc. | 70,068 | |||||
2,200 | Home Inns & Hotels | ||||||
Management, Inc. - ADR* | 54,560 | ||||||
3,800 | Hyatt Hotels Corp.* | 152,570 | |||||
8,600 | InterContinental Hotels | ||||||
Group PLC - ADR | 225,750 | ||||||
2,100 | Jack in the Box Inc.* | 59,031 | |||||
68,400 | Jamba, Inc.* | 152,532 | |||||
20,400 | Krispy Kreme Doughnuts, Inc.* | 161,772 | |||||
9,800 | Las Vegas Sands Corp. | 454,426 | |||||
2,700 | LIFE TIME FITNESS, Inc.* | 123,498 | |||||
4,200 | Luby’s, Inc.* | 28,266 | |||||
6,900 | Marriott International Inc. | 269,790 | |||||
5,700 | Marriott Vacations | ||||||
Worldwide Corporation* | 205,314 | ||||||
3,800 | McDonald’s Corp. | 348,650 | |||||
12,400 | Melco Crown | ||||||
Entertainment Ltd. - ADR* | 167,152 | ||||||
10,900 | MGM Resorts International* | 117,175 | |||||
1,600 | MTR Gaming Group, Inc.* | 6,736 | |||||
4,300 | Panera Bread Co.* | 734,827 | |||||
9,600 | Papa John’s International, Inc.* | 512,736 | |||||
1,300 | Penn National Gaming, Inc.* | 56,030 | |||||
1,100 | Red Robin Gourmet Burgers Inc.* | 35,816 | |||||
4,000 | Royal Caribbean Cruises Ltd. | 120,840 | |||||
15,200 | Ruth’s Hospitality Group Inc.* | 96,824 | |||||
4,600 | Shuffle Master, Inc.* | 72,726 | |||||
23,800 | Starbucks Corp. | 1,207,850 | |||||
4,400 | Starwood Hotels & | ||||||
Resorts Worldwide, Inc. | 255,024 | ||||||
700 | Tim Hortons, Inc. | 36,421 | |||||
10,900 | Wyndham Worldwide Corp. | 572,032 | |||||
2,400 | Wynn Resorts Ltd. | 277,056 | |||||
1,700 | Yum! Brands, Inc. | 112,778 | |||||
9,754,038 | |||||||
Household Durables — 1.3% | |||||||
2,200 | Ethan Allen Interiors Inc. | 48,224 | |||||
5,700 | Garmin Ltd. | 237,918 | |||||
3,800 | Harman International | ||||||
Industries, Inc. | 175,408 | ||||||
3,400 | iRobot Corporation* | 77,384 | |||||
5,100 | Jarden Corporation | 269,484 | |||||
17,800 | La-Z-Boy Inc.* | 260,414 | |||||
1,200 | Leggett & Platt, Incorporated | 30,060 | |||||
3,200 | M.D.C. Holdings, Inc. | 123,232 | |||||
1,300 | Mohawk Industries, Inc.* | 104,026 | |||||
7,800 | Newell Rubbermaid Inc. | 148,902 | |||||
1,800 | SodaStream International Ltd.* | 70,506 | |||||
4,330 | Stanley Black & Decker Inc. | 330,162 | |||||
6,400 | Tempur-Pedic International Inc.* | 191,296 |
The accompanying notes to financial statements are an integral part of this schedule.
- 14 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Household Durables — 1.3% (Continued) | |||||||
5,000 | Tupperware Brands Corp. | $ | 267,950 | ||||
1,800 | Whirlpool Corporation | 149,238 | |||||
2,484,204 | |||||||
Household Products — 0.4% | |||||||
2,100 | Church & Dwight Co., Inc. | 113,379 | |||||
400 | Colgate-Palmolive Co. | 42,888 | |||||
4,000 | Kimberly-Clark Corporation | 343,120 | |||||
1,300 | The Procter & Gamble Company | 90,168 | |||||
3,100 | WD-40 Co. | 163,184 | |||||
752,739 | |||||||
Industrial Conglomerates — 0.4% | |||||||
1,500 | 3M Co. | 138,630 | |||||
7,800 | General Electric Company | 177,138 | |||||
1,700 | Koninklijke Philips | ||||||
Electronics N.V. NYS | 39,865 | ||||||
7,200 | McDermott International, Inc.* | 87,984 | |||||
700 | Siemens AG - SP-ADR | 70,105 | |||||
11,400 | Textron Inc. | 298,338 | |||||
812,060 | |||||||
Insurance — 1.5% | |||||||
400 | Aflac, Inc. | 19,152 | |||||
700 | Allied World Assurance | ||||||
Company Holdings AG | 54,075 | ||||||
3,000 | The Allstate Corporation | 118,830 | |||||
25,000 | Ambac Financial Group, Inc.* | 563 | |||||
4,500 | American International Group, Inc.* | 147,555 | |||||
3,000 | W.R. Berkley Corporation | 112,470 | |||||
2,000 | Berkshire Hathaway Inc. Cl B* | 176,400 | |||||
2,600 | CNO Financial Group, Inc. | 25,090 | |||||
500 | Everest Re Group, Ltd. | 53,480 | |||||
8,000 | First American Financial Corporation | 173,360 | |||||
5,300 | Arthur J. Gallagher & Co. | 189,846 | |||||
8,900 | Genworth Financial Inc.* | 46,547 | |||||
4,800 | The Hartford Financial | ||||||
Services Group, Inc. | 93,312 | ||||||
3,000 | Homeowners Choice, Inc. | 70,500 | |||||
6,200 | Marsh & McLennan | ||||||
Companies, Inc. | 210,366 | ||||||
15,700 | MBIA Inc.* | 159,041 | |||||
4,500 | MetLife, Inc. | 155,070 | |||||
6,300 | Prudential Financial, Inc. | 343,413 | |||||
2,800 | Stewart Information | ||||||
Services Corporation | 56,392 | ||||||
6,300 | Torchmark Corp. | 323,505 | |||||
4,300 | The Travelers Companies, Inc. | 293,518 | |||||
2,822,485 | |||||||
Internet & Catalog Retail — 2.4% | |||||||
5,000 | Amazon.com, Inc.* | 1,271,600 | |||||
8,000 | Expedia, Inc. | 462,720 | |||||
700 | Groupon, Inc.* | 3,332 | |||||
2,100 | HSN, Inc. | 103,005 | |||||
2,700 | Liberty Interactive Corporation* | 49,950 | |||||
1,800 | Orbitz Worldwide, Inc.* | 4,590 | |||||
4,500 | Overstock.com, Inc.* | 46,620 | |||||
3,450 | Priceline.com Inc.* | 2,134,619 | |||||
1,900 | Shutterfly, Inc.* | 59,128 | |||||
7,100 | TripAdvisor Inc.* | 233,803 | |||||
4,369,367 | |||||||
Internet Software & Services — 4.4% | |||||||
1,600 | Akamai Technologies, Inc.* | 61,216 | |||||
2,100 | Ancestry.com, Inc.* | 63,168 | |||||
1,000 | Angie’s List Inc.* | 10,580 | |||||
3,200 | Baidu, Inc. - SP-ADR* | 373,824 | |||||
9,700 | BroadVision, Inc.* | 90,889 | |||||
14,200 | eBay Inc.* | 687,422 | |||||
2,800 | Equinix, Inc.* | 576,940 | |||||
1,900 | Facebook Inc.* | 41,135 | |||||
4,384 | Google Inc.* | 3,307,728 | |||||
6,300 | IAC/InterActiveCorp | 327,978 | |||||
11,600 | Internet Initiative | ||||||
Japan Inc. - SP-ADR | 156,252 | ||||||
1,800 | j2 Global, Inc. | 59,076 | |||||
800 | LinkedIn Corporation* | 96,320 | |||||
8,800 | Liquidity Services Inc.* | 441,848 | |||||
1,000 | LogMeIn, Inc.* | 22,430 | |||||
400 | MercadoLibre Inc. | 33,020 | |||||
9,500 | Monster Worldwide, Inc.* | 69,635 | |||||
900 | Move, Inc.* | 7,758 | |||||
2,800 | NetEase.com Inc. - ADR* | 157,192 | |||||
3,800 | OpenTable, Inc.* | 158,080 |
The accompanying notes to financial statements are an integral part of this schedule.
- 15 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Internet Software & Services — 4.4% (Continued) | |||||||
5,800 | Rackspace Hosting, Inc.* | $ | 383,322 | ||||
1,600 | Rediff.com India Limited - ADR* | 6,064 | |||||
1,500 | SINA Corporation* | 97,020 | |||||
1,500 | Sohu.com Inc.* | 63,135 | |||||
7,100 | Support.com Inc.* | 30,033 | |||||
6,000 | Synacor Inc.* | 45,480 | |||||
5,300 | Travelzoo Inc.* | 124,921 | |||||
9,600 | ValueClick, Inc.* | 165,024 | |||||
3,600 | VeriSign, Inc.* | 175,284 | |||||
1,700 | VistaPrint N.V.* | 58,055 | |||||
6,200 | Zillow, Inc.* | 261,516 | |||||
8,152,345 | |||||||
IT Services — 2.6% | |||||||
1,700 | Accenture PLC | 119,051 | |||||
2,300 | Acxiom Corporation* | 42,021 | |||||
3,700 | Alliance Data Systems Corporation* | 525,215 | |||||
9,400 | Cognizant Technology Solutions Corp.* | 657,248 | |||||
900 | CoreLogic, Inc.* | 23,877 | |||||
700 | CSG Systems International, Inc.* | 15,743 | |||||
2,500 | DST Systems, Inc. | 141,400 | |||||
2,200 | Fidelity National | ||||||
Information Services, Inc. | 68,684 | ||||||
4,500 | Fiserv, Inc.* | 333,135 | |||||
5,700 | Gartner, Inc.* | 262,713 | |||||
600 | Infosys Limited - SP-ADR | 29,124 | |||||
8,600 | InterXion Holding N.V.* | 195,392 | |||||
3,400 | Iron Mountain Incorporated | 115,974 | |||||
1,300 | Mastercard, Inc. | 586,924 | |||||
3,200 | MAXIMUS, Inc. | 191,104 | |||||
3,900 | Paychex, Inc. | 129,831 | |||||
11,900 | Sapient Corp.* | 126,854 | |||||
4,800 | Total System Services, Inc. | 113,760 | |||||
2,200 | Vantiv, Inc.* | 47,410 | |||||
7,800 | VeriFone Systems, Inc.* | 217,230 | |||||
7,300 | Visa Inc. | 980,244 | |||||
4,922,934 | |||||||
Leisure Equipment & Products — 0.2% | |||||||
40,900 | Eastman Kodak Co.* | 7,607 | |||||
800 | Hasbro, Inc. | 30,536 | |||||
4,200 | Mattel, Inc. | 149,016 | |||||
6,500 | Smith & Wesson | ||||||
Holding Corporation* | 71,565 | ||||||
1,400 | Sturm, Ruger & Company, Inc. | 69,286 | |||||
328,010 | |||||||
Life Sciences Tools & Services — 0.6% | |||||||
5,000 | Affymetrix, Inc.* | 21,650 | |||||
6,600 | Bruker Corp.* | 86,394 | |||||
6,300 | Cambrex Corp.* | 73,899 | |||||
5,800 | Complete Genomics Inc.* | 18,038 | |||||
800 | Illumina, Inc.* | 38,560 | |||||
1,400 | Life Technologies Corporation* | 68,432 | |||||
1,000 | Mettler-Toledo International Inc.* | 170,740 | |||||
10,400 | Parexel International Corp.* | 319,904 | |||||
2,100 | PerkinElmer, Inc. | 61,887 | |||||
2,600 | Thermo Fisher Scientific, Inc. | 152,958 | |||||
1,200 | Waters Corp.* | 99,996 | |||||
1,112,458 | |||||||
Machinery — 2.4% | |||||||
3,600 | 3D Systems Corporation* | 118,260 | |||||
1,600 | AGCO Corporation* | 75,968 | |||||
3,000 | Alamo Group Inc. | 101,340 | |||||
3,100 | Barnes Group Inc. | 77,531 | |||||
900 | Caterpillar Inc. | 77,436 | |||||
5,300 | Crane Co. | 211,629 | |||||
1,300 | Cummins Inc. | 119,873 | |||||
2,700 | Deere & Co. | 222,723 | |||||
9,500 | Donaldson Company, Inc. | 329,745 | |||||
800 | Dover Corporation | 47,592 | |||||
2,600 | Eaton Corp. | 122,876 | |||||
2,000 | FreightCar America Inc. | 35,580 | |||||
4,700 | IDEX Corporation | 196,319 | |||||
5,200 | Illinois Tool Works Inc. | 309,244 | |||||
3,700 | Ingersoll-Rand PLC | 165,834 | |||||
2,500 | Joy Global Inc. | 140,150 | |||||
4,200 | Kennametal Inc. | 155,736 | |||||
1,800 | Manitex International Inc.* | 13,014 | |||||
2,400 | Navistar International Corp.* | 50,616 | |||||
900 | Nordson Corporation | 52,758 | |||||
4,600 | Pall Corp. | 292,054 |
The accompanying notes to financial statements are an integral part of this schedule.
- 16 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Machinery — 2.4% (Continued) | |||||||
6,500 | Parker Hannifin Corp. | $ | 543,270 | ||||
600 | Robbins & Myers, Inc. | 35,760 | |||||
2,000 | Sauer-Danfoss, Inc. | 80,420 | |||||
6,700 | Snap-On, Inc. | 481,529 | |||||
7,700 | Terex Corp.* | 173,866 | |||||
4,200 | Titan International, Inc. | 74,172 | |||||
1,500 | Valmont Industries, Inc. | 197,250 | |||||
4,502,545 | |||||||
Media — 3.2% | |||||||
6,900 | Belo Corp. | 54,027 | |||||
8,700 | CBS Corp. Cl B Non-Voting | 316,071 | |||||
2,300 | Comcast Corp. | 82,271 | |||||
8,200 | DIRECTV* | 430,172 | |||||
5,200 | Discovery Communications, Inc.* | 310,076 | |||||
4,500 | DISH Network Corp. | 137,745 | |||||
12,300 | The Walt Disney Co. | 643,044 | |||||
8,000 | Gannett Co., Inc. | 142,000 | |||||
7,200 | IMAX Corp.* | 143,352 | |||||
10,700 | The Interpublic Group | ||||||
of Companies, Inc. | 118,984 | ||||||
600 | Lamar Advertising Company* | 22,236 | |||||
9,600 | Lee Enterprises, Incorporated* | 14,208 | |||||
200 | Liberty Global, Inc.* | 12,150 | |||||
5,700 | Liberty Media Corporation* | 593,769 | |||||
5,000 | Lions Gate Entertainment Corp.* | 76,350 | |||||
4,900 | Live Nation Entertainment, Inc.* | 42,189 | |||||
900 | Martha Stewart Living | ||||||
Omnimedia, Inc. | 2,763 | ||||||
1,700 | The McGraw-Hill Companies, Inc. | 92,803 | |||||
1,200 | Morningstar, Inc. | 75,168 | |||||
3,500 | The New York Times Company* | 34,160 | |||||
19,000 | News Corp. Cl B | 471,200 | |||||
5,800 | Omnicom Group Inc. | 299,048 | |||||
1,000 | Scholastic Corporation | 31,780 | |||||
3,100 | Scripps Networks Interactive | 189,813 | |||||
176,100 | Sirius XM Radio Inc.* | 457,860 | |||||
5,700 | Time Warner Cable Inc. | 541,842 | |||||
8,000 | Time Warner Inc. | 362,640 | |||||
1,500 | Viacom Inc. Cl B | 80,385 | |||||
7,500 | Virgin Media Inc. | 220,800 | |||||
5,998,906 | |||||||
Metals & Mining — 1.9% | |||||||
1,000 | Agnico-Eagle Mines Limited | 51,880 | |||||
1,500 | Alcoa Inc. | 13,275 | |||||
1,100 | Allegheny Technologies, Inc. | 35,090 | |||||
13,600 | AuRico Gold Inc.* | 94,928 | |||||
2,200 | Barrick Gold Corporation | 91,872 | |||||
800 | BHP Billiton Limited - SP-ADR | 54,888 | |||||
1,933 | China Precision Steel, Inc.* | 4,389 | |||||
2,600 | Cliffs Natural Resources Inc. | 101,738 | |||||
4,100 | Coeur d’ Alene Mines Corp.* | 118,203 | |||||
6,600 | Eldorado Gold Corporation | 100,584 | |||||
6,500 | Freeport-McMoRan | ||||||
Copper & Gold Inc. | 257,270 | ||||||
20,000 | Golden Star Resources Ltd.* | 39,400 | |||||
2,000 | Harmony Gold Mining | ||||||
Company Limited - SP-ADR | 16,820 | ||||||
18,700 | Hecla Mining Co. | 122,485 | |||||
3,200 | IAMGOLD Corp. | 50,592 | |||||
11,300 | Kinross Gold Corp. | 115,373 | |||||
9,900 | Molycorp, Inc.* | 113,850 | |||||
30,600 | New Gold Inc.* | 373,932 | |||||
1,500 | Newmont Mining Corporation | 84,015 | |||||
900 | NovaCopper Inc.* | 1,935 | |||||
29,400 | NovaGold Resources Inc.* | 164,640 | |||||
3,900 | Pan American Silver Corp. | 83,655 | |||||
9,400 | Paramount Gold and | ||||||
Silver Corporation* | 25,004 | ||||||
1,175 | Pilot Gold Inc.*^ | 2,032 | |||||
4,600 | Rare Element Resources Ltd.*^ | 22,632 | |||||
1,600 | Rio Tinto PLC - SP-ADR | 74,816 | |||||
900 | RTI International Metals, Inc.* | 21,546 | |||||
11,200 | Silver Standard Resources Inc.* | 179,536 | |||||
12,700 | Silver Wheaton Corp. | 504,317 | |||||
2,000 | Southern Copper Corp. | 68,720 | |||||
2,500 | Steel Dynamics, Inc. | 28,075 | |||||
11,600 | Stillwater Mining Company* | 136,764 | |||||
2,513 | SunCoke Energy, Inc.* | 40,509 | |||||
16,000 | Taseko Mines Ltd.* | 53,440 |
The accompanying notes to financial statements are an integral part of this schedule.
- 17 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Metals & Mining — 1.9% (Continued) | |||||||
1,000 | Teck Resources Ltd. Cl B | $ | 29,450 | ||||
10,674 | Yamana Gold Inc. | 203,980 | |||||
3,481,635 | |||||||
Multiline Retail — 1.9% | |||||||
2,900 | Big Lots, Inc.* | 85,782 | |||||
5,700 | The Bon-Ton Stores, Inc. | 54,150 | |||||
500 | Dillard’s, Inc. | 36,160 | |||||
1,200 | Dollar General Corp.* | 61,848 | |||||
3,100 | Dollar Tree, Inc.* | 149,652 | |||||
4,000 | Family Dollar Stores, Inc. | 265,200 | |||||
5,000 | Kohl’s Corp. | 256,100 | |||||
22,900 | Macy’s, Inc. | 861,498 | |||||
17,900 | Nordstrom, Inc. | 987,722 | |||||
12,500 | Saks, Inc.* | 128,875 | |||||
1,500 | Sears Holdings Corporation* | 83,235 | |||||
8,800 | Target Corp. | 558,536 | |||||
3,528,758 | |||||||
Multi-Utilities — 0.2% | |||||||
1,200 | CMS Energy Corporation | 28,260 | |||||
1,800 | Dominion Resources, Inc. | 95,292 | |||||
5,400 | NiSource Inc. | 137,592 | |||||
1,100 | Sempra Energy | 70,939 | |||||
332,083 | |||||||
Oil, Gas & Consumable Fuels — 3.3% | |||||||
3,700 | Alpha Natural Resources, Inc.* | 24,309 | |||||
1,000 | Anadarko Petroleum Corp. | 69,920 | |||||
1,000 | Apache Corp. | 86,470 | |||||
2,700 | Cabot Oil & Gas Corporation | 121,230 | |||||
2,100 | Calumet Specialty | ||||||
Products Partners, L.P. | 67,200 | ||||||
2,200 | Canadian Natural Resources Ltd. | 67,738 | |||||
4,800 | Carrizo Oil & Gas, Inc.* | 120,048 | |||||
2,700 | Cenovus Energy Inc. | 94,095 | |||||
12,900 | Cheniere Energy, Inc.* | 200,595 | |||||
300 | Chevron Corporation | 34,968 | |||||
3,600 | Clean Energy Fuels Corporation* | 47,412 | |||||
200 | CNOOC Limited - ADR | 40,546 | |||||
1,100 | Cobalt International Energy, Inc.* | 24,497 | |||||
1,300 | Concho Resources Inc.* | 123,175 | |||||
4,000 | ConocoPhillips | 228,720 | |||||
1,100 | Continental Resources, Inc.* | 84,590 | |||||
800 | CVR Energy, Inc.* | 29,400 | |||||
3,100 | Denbury Resources Inc.* | 50,096 | |||||
4,400 | Enbridge Inc. | 171,732 | |||||
5,500 | EnCana Corp. | 120,560 | |||||
300 | EOG Resources, Inc. | 33,615 | |||||
3,000 | Hess Corp. | 161,160 | |||||
5,700 | HollyFrontier Corporation | 235,239 | |||||
28,500 | Ivanhoe Energy, Inc.* | 14,820 | |||||
10,700 | James River Coal Company* | 30,816 | |||||
30,300 | Kodiak Oil & Gas Corp.* | 283,608 | |||||
2,700 | Marathon Oil Corp. | 79,839 | |||||
5,650 | Marathon Petroleum Corporation | 308,434 | |||||
2,400 | McMoRan Exploration Co.* | 28,200 | |||||
2,000 | Noble Energy, Inc. | 185,420 | |||||
900 | Northern Oil and Gas, Inc.* | 15,291 | |||||
3,400 | Occidental Petroleum Corp. | 292,604 | |||||
3,600 | Peabody Energy Corp. | 80,244 | |||||
600 | PetroChina Company Ltd. | 77,496 | |||||
9,700 | Petroleo Brasileiro S.A. - ADR | 222,518 | |||||
6,200 | Phillips 66 | 287,494 | |||||
1,800 | Pioneer Natural Resources Co. | 187,920 | |||||
3,300 | Plains Exploration & | ||||||
Production Company* | 123,651 | ||||||
2,900 | Range Resources Corp. | 202,623 | |||||
1,500 | Rentech, Inc.* | 3,690 | |||||
11,100 | SandRidge Energy Inc.* | 77,367 | |||||
700 | Sasol Ltd. - SP-ADR | 31,206 | |||||
700 | Stone Energy Corporation* | 17,584 | |||||
5,300 | Suncor Energy, Inc. | 174,105 | |||||
4,600 | Tesoro Corp. | 192,740 | |||||
16,400 | TransGlobe Energy Corp.* | 178,104 | |||||
4,300 | Valero Energy Corp. | 136,224 | |||||
9,600 | Western Refining, Inc. | 251,328 | |||||
4,900 | Whiting Petroleum Corp.* | 232,162 | |||||
7,700 | The Williams Companies, Inc. | 269,269 | |||||
6,222,072 | |||||||
Paper & Forest Products — 0.5% | |||||||
8,800 | P.H. Glatfelter Co. | 156,728 |
The accompanying notes to financial statements are an integral part of this schedule.
- 18 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Paper & Forest Products — 0.5% (Continued) | |||||||
7,800 | International Paper Co. | $ | 283,296 | ||||
400 | Kapstone Paper and | ||||||
Packaging Corporation* | 8,956 | ||||||
27,400 | Louisiana-Pacific Corp.* | 342,500 | |||||
6,100 | MeadWestvaco Corporation | 186,660 | |||||
978,140 | |||||||
Personal Products — 0.2% | |||||||
4,000 | Elizabeth Arden, Inc.* | 188,960 | |||||
1,400 | The Estee Lauder Companies Inc. | 86,198 | |||||
3,100 | Medifast, Inc.* | 81,065 | |||||
2,100 | Revlon, Inc.* | 32,424 | |||||
1,300 | Weight Watchers | ||||||
International, Inc. | 68,640 | ||||||
457,287 | |||||||
Pharmaceuticals — 2.4% | |||||||
3,900 | Abbott Laboratories | 267,384 | |||||
3,700 | Allergan, Inc. | 338,846 | |||||
800 | AstraZeneca PLC - SP-ADR | 38,288 | |||||
3,900 | Bristol-Myers Squibb Company | 131,625 | |||||
2,100 | Dr. Reddy’s Laboratories | ||||||
Limited - ADR | 64,806 | ||||||
20,300 | Elan Corporation plc - SP-ADR* | 217,616 | |||||
7,000 | Forest Laboratories, Inc.* | 249,270 | |||||
1,100 | GlaxoSmithKline-PLC - SP-ADR | 50,864 | |||||
2,700 | Jazz Pharmaceuticals, Inc.* | 153,927 | |||||
1,800 | Johnson & Johnson | 124,038 | |||||
4,600 | Eli Lilly and Co. | 218,086 | |||||
4,900 | The Medicines Company* | 126,469 | |||||
800 | Merck & Co., Inc. | 36,080 | |||||
15,200 | Mylan, Inc.* | 370,880 | |||||
1,800 | Novartis AG - ADR | 110,268 | |||||
2,200 | Novo Nordisk A/S - SP-ADR | 347,182 | |||||
3,200 | Perrigo Co. | 371,744 | |||||
4,400 | Pfizer Inc. | 109,340 | |||||
1,500 | Sanofi - ADR | 64,590 | |||||
5,000 | SciClone Pharmaceuticals, Inc.* | 27,750 | |||||
700 | Shire PLC- ADR | 62,090 | |||||
3,000 | Valeant Pharmaceuticals | ||||||
International, Inc.* | 165,810 | ||||||
10,000 | ViroPharma Inc.* | 302,200 | |||||
2,500 | VIVUS Inc.* | 44,550 | |||||
5,800 | Watson Pharmaceuticals, Inc.* | 493,928 | |||||
4,487,631 | |||||||
Professional Services — 0.5% | |||||||
1,200 | The Dun & Bradstreet Corporation | 95,544 | |||||
1,200 | Equifax Inc. | 55,896 | |||||
4,900 | IHS Inc.* | 477,015 | |||||
10,700 | On Assignment, Inc.* | 213,144 | |||||
1,100 | Towers Watson & Company | 58,355 | |||||
2,300 | Verisk Analytics, Inc.* | 109,503 | |||||
1,009,457 | |||||||
Real Estate Management | |||||||
& Development — 0.1% | |||||||
2,400 | CBRE Group, Inc.* | 44,184 | |||||
4,900 | The St. Joe Company* | 95,550 | |||||
139,734 | |||||||
Road & Rail — 1.5% | |||||||
2,600 | Avis Budget Group, Inc.* | 39,988 | |||||
6,300 | Canadian National Railway Company | 555,849 | |||||
3,300 | Canadian Pacific Railway Limited | 273,537 | |||||
500 | CSX Corp. | 10,375 | |||||
600 | Genesee & Wyoming Inc.* | 40,116 | |||||
16,400 | Hertz Global Holdings, Inc.* | 225,172 | |||||
4,900 | J.B. Hunt Transportation | ||||||
Services, Inc. | 254,996 | ||||||
5,100 | Kansas City Southern | 386,478 | |||||
9,200 | Old Dominion Freight Line, Inc.* | 277,472 | |||||
2,900 | Ryder Systems, Inc. | 113,274 | |||||
4,500 | Union Pacific Corp. | 534,150 | |||||
2,200 | Zipcar, Inc.* | 17,116 | |||||
2,728,523 | |||||||
Semiconductors & Semiconductor | |||||||
Equipment — 1.7% | |||||||
1,400 | Applied Materials, Inc. | 15,631 | |||||
4,400 | ARM Holdings plc - SP-ADR | 123,112 | |||||
2,500 | Avago Technologies Ltd. | 87,163 | |||||
3,600 | Broadcom Corp. | 124,488 | |||||
4,800 | Cavium Inc.* | 159,984 | |||||
4,600 | Cirrus Logic, Inc.* | 176,594 |
The accompanying notes to financial statements are an integral part of this schedule.
- 19 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Semiconductors & Semiconductor | |||||||
Equipment — 1.7% (Continued) | |||||||
2,500 | Cree, Inc.* | $ | 63,825 | ||||
2,200 | Cypress Semiconductor Corp. | 23,584 | |||||
14,100 | Entegris Inc.* | 114,633 | |||||
900 | EZchip Semiconductor Ltd.* | 27,531 | |||||
8,000 | Fairchild Semiconductor | ||||||
International, Inc.* | 104,960 | ||||||
7,100 | Integrated Device Technology, Inc.* | 41,748 | |||||
2,500 | KLA-Tencor Corp. | 119,262 | |||||
12,200 | Kulicke and Soffa Industries, Inc.* | 126,880 | |||||
18,900 | Lattice Semiconductor Corp.* | 72,387 | |||||
1,200 | Linear Technology Corporation | 38,220 | |||||
28,300 | LSI Corp.* | 195,553 | |||||
2,600 | LTX-Credence Corporation* | 14,950 | |||||
4,700 | Maxim Integrated Products, Inc. | 125,114 | |||||
1,200 | Mellanox Technologies Ltd.* | 121,836 | |||||
2,900 | MEMC Electronic Materials, Inc.* | 7,975 | |||||
1,700 | Microchip Technology Inc. | 55,658 | |||||
7,200 | Micron Technology, Inc.* | 43,092 | |||||
2,200 | Microsemi Corporation* | 44,154 | |||||
11,200 | MIPS Technologies, Inc.* | 82,768 | |||||
11,300 | NVIDIA Corp.* | 150,742 | |||||
10,400 | OmniVision Technologies, Inc.* | 145,132 | |||||
22,100 | ON Semiconductor Corp.* | 136,357 | |||||
1,500 | PDF Solutions, Inc.* | 20,490 | |||||
4,300 | RF Micro Devices, Inc.* | 16,985 | |||||
7,600 | Skyworks Solutions, Inc.* | 179,094 | |||||
4,100 | Taiwan Semiconductor Manufacturing | ||||||
Company Ltd. - SP-ADR | 64,862 | ||||||
15,300 | Teradyne, Inc.* | 217,566 | |||||
9,600 | TriQuint Semiconductor, Inc.* | 48,480 | |||||
3,400 | Veeco Instruments Inc.* | 102,068 | |||||
800 | Xilinx, Inc. | 26,728 | |||||
3,219,606 | |||||||
Software — 5.4% | |||||||
5,700 | Adobe Systems Inc.* | 185,022 | |||||
2,500 | Advent Software, Inc.* | 61,425 | |||||
600 | ANSYS, Inc.* | 44,040 | |||||
7,600 | Autodesk, Inc.* | 253,612 | |||||
2,000 | BMC Software, Inc.* | 82,980 | |||||
500 | BroadSoft Inc.* | 20,510 | |||||
4,100 | CA, Inc. | 105,637 | |||||
10,200 | Cadence Design Systems, Inc.* | 131,223 | |||||
1,200 | Check Point Software | ||||||
Technologies Ltd.* | 57,792 | ||||||
10,500 | Citrix Systems, Inc.* | 803,985 | |||||
20,400 | Compuware Corp.* | 202,164 | |||||
1,500 | Ebix, Inc. | 35,415 | |||||
1,800 | Electronic Arts Inc.* | 22,842 | |||||
1,700 | Ellie Mae, Inc.* | 46,291 | |||||
2,600 | FactSet Research Systems Inc. | 250,692 | |||||
6,500 | Fair Isaac Corp. | 287,690 | |||||
12,900 | Fortinet Inc.* | 311,406 | |||||
16,700 | Glu Mobile Inc.* | 77,321 | |||||
6,800 | Jack Henry & Associates, Inc. | 257,720 | |||||
5,000 | Informatica Corp.* | 174,050 | |||||
8,700 | Intuit Inc. | 512,256 | |||||
4,100 | JDA Software Group, Inc.* | 130,298 | |||||
18,100 | Mentor Graphics Corporation* | 280,188 | |||||
3,200 | MICROS Systems, Inc.* | 157,184 | |||||
700 | Microsoft Corp. | 20,846 | |||||
7,720 | NetSuite Inc.* | 492,536 | |||||
7,000 | Nuance Communications, Inc.* | 174,230 | |||||
4,700 | Oracle Corp. | 148,003 | |||||
5,100 | Parametric Technology Corp.* | 111,180 | |||||
4,200 | Progress Software Corporation* | 89,838 | |||||
1,500 | QLIK Technologies Inc.* | 33,615 | |||||
4,000 | Quality Systems, Inc. | 74,200 | |||||
8,100 | Red Hat, Inc.* | 461,214 | |||||
4,300 | Rosetta Stone, Inc.* | 54,825 | |||||
1,700 | Rovi Corporation* | 24,667 | |||||
3,700 | Salesforce.com, Inc.* | 564,953 | |||||
4,700 | SAP AG - SP-ADR | 335,251 | |||||
3,100 | Solarwinds, Inc.* | 172,794 | |||||
3,100 | Sourcefire Inc.* | 151,993 | |||||
400 | Splunk, Inc.* | 14,688 | |||||
3,500 | Symantec Corp.* | �� | 63,000 | ||||
4,700 | Synopsys, Inc.* | 155,194 | |||||
6,000 | TIBCO Software Inc.* | 181,380 | |||||
2,800 | TiVo Inc.* | 29,204 |
The accompanying notes to financial statements are an integral part of this schedule.
- 20 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Software — 5.4% (Continued) | |||||||
6,400 | Tyler Technologies, Inc.* | $ | 281,728 | ||||
10,000 | The Ultimate Software Group, Inc.* | 1,021,000 | |||||
500 | Virnetx Holding Corporation* | 12,715 | |||||
8,700 | VMware Inc.* | 841,638 | |||||
10,300 | Wave Systems Corp.* | 9,692 | |||||
6,600 | Zynga Inc. Cl A* | 18,744 | |||||
10,030,871 | |||||||
Solar — 0.1% | |||||||
8,200 | First Solar, Inc.* | 181,589 | |||||
10,500 | JA Solar Holdings Co. Ltd. - ADR* | 8,925 | |||||
1,400 | LDK Solar Company Ltd. - ADR* | 1,526 | |||||
1,500 | Suntech Power Holdings | ||||||
Company, Ltd. - ADR* | 1,290 | ||||||
193,330 | |||||||
Specialty Retail — 8.2% | |||||||
12,700 | American Eagle Outfitters, Inc. | 267,716 | |||||
1,500 | ANN INC.* | 56,595 | |||||
900 | Ascena Retail Group, Inc.* | 19,305 | |||||
7,700 | AutoNation, Inc.* | 336,259 | |||||
700 | AutoZone, Inc.* | 258,769 | |||||
8,800 | Bed Bath & Beyond Inc.* | 554,400 | |||||
36,000 | Borders Group, Inc.*(b) | — | |||||
700 | Cabela’s Incorporated* | 38,276 | |||||
5,500 | CarMax, Inc.* | 155,650 | |||||
20,000 | Chico’s FAS, Inc. | 362,200 | |||||
4,000 | The Children’s Place | ||||||
Retail Stores, Inc.* | 240,000 | ||||||
22,600 | Coldwater Creek Inc.* | 18,758 | |||||
13,200 | Dick’s Sporting Goods, Inc. | 684,420 | |||||
1,700 | DSW, Inc. | 113,424 | |||||
4,000 | Express, Inc.* | 59,280 | |||||
4,700 | The Finish Line, Inc. | 106,878 | |||||
2,700 | Five Below, Inc.* | 105,516 | |||||
19,500 | Foot Locker, Inc. | 692,250 | |||||
3,500 | Francesca’s Holdings Corporation* | 107,555 | |||||
4,600 | GameStop Corporation | 96,600 | |||||
13,500 | The Gap, Inc. | 483,030 | |||||
4,000 | GNC Acquisition Holdings Inc. | 155,880 | |||||
2,700 | Group 1 Automotive, Inc. | 162,621 | |||||
5,300 | Hibbett Sports Inc.* | 315,085 | |||||
10,900 | The Home Depot, Inc. | 658,033 | |||||
3,200 | Hot Topic, Inc. | 27,840 | |||||
9,900 | Limited Brands, Inc. | 487,674 | |||||
12,600 | Lithia Motors, Inc. | 419,706 | |||||
18,800 | Lowe’s Companies, Inc. | 568,512 | |||||
9,100 | Lumber Liquidators Holdings, Inc.* | 461,188 | |||||
900 | Mattress Firm Holding Corp.* | 25,335 | |||||
44,100 | Office Depot, Inc.* | 112,896 | |||||
20,000 | OfficeMax Inc. | 156,200 | |||||
6,400 | O’Reilly Automotive, Inc.* | 535,168 | |||||
1,000 | The Pep Boys-Manny, Moe & Jack | 10,180 | |||||
3,400 | PetSmart, Inc. | 234,532 | |||||
52,300 | Pier 1 Imports, Inc. | 980,102 | |||||
2,400 | Rent-A-Center, Inc. | 84,192 | |||||
24,700 | Ross Stores, Inc. | 1,595,620 | |||||
3,400 | Sally Beauty Holdings, Inc.* | 85,306 | |||||
3,800 | Select Comfort Corporation* | 119,890 | |||||
2,600 | The Sherwin-Williams Co. | 387,166 | |||||
5,700 | Sonic Automotive, Inc. | 108,186 | |||||
1,400 | Staples, Inc. | 16,128 | |||||
5,100 | Tiffany & Co. | 315,588 | |||||
29,000 | The TJX Companies, Inc. | 1,298,910 | |||||
2,300 | Tractor Supply Company | 227,447 | |||||
2,900 | Ulta Salon, Cosmetics | ||||||
& Fragrance, Inc. | 279,285 | ||||||
8,900 | Urban Outfitters, Inc.* | 334,284 | |||||
2,400 | Vitamin Shoppe, Inc.* | 139,968 | |||||
5,100 | Williams-Sonoma, Inc. | 224,247 | |||||
6,200 | Zale Corporation* | 42,780 | |||||
15,326,830 | |||||||
Telecommunication Services – | |||||||
Diversified — 0.7% | |||||||
37,600 | 8x8, Inc.* | 246,656 | |||||
1,500 | AT&T Inc. | 56,550 | |||||
4,600 | BT Group plc - SP-ADR | 171,120 | |||||
1,500 | Frontier Communications | ||||||
Corporation | 7,350 | ||||||
1,200 | Level 3 Communications, Inc.* | 27,564 | |||||
15,700 | magicJack VocalTec Ltd.* | 385,121 | |||||
13,400 | tw telecom inc.* | 349,338 |
The accompanying notes to financial statements are an integral part of this schedule.
- 21 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
COMMON STOCKS — 97.0% (a) (Continued) | |||||||
Telecommunication Services – | |||||||
Diversified — 0.7% (Continued) | |||||||
2,900 | VimpelCom Ltd. - SP-ADR | $ | 34,510 | ||||
5,500 | Windstream Corporation | 55,605 | |||||
1,333,814 | |||||||
Telecommunication Services – | |||||||
Wireless — 1.1% | |||||||
1,500 | China Mobile Limited - SP-ADR | 83,040 | |||||
8,300 | Crown Castle International Corp.* | 532,030 | |||||
21,000 | Leap Wireless International, Inc.* | 143,220 | |||||
16,160 | MetroPCS Communications, Inc.* | 189,234 | |||||
3,400 | Mobile TeleSystems - SP-ADR | 59,568 | |||||
3,000 | NII Holdings Inc.* | 23,550 | |||||
1,000 | Rogers Communications, Inc. Cl B | 40,400 | |||||
13,100 | SBA Communications Corporation* | 823,990 | |||||
25,500 | Sprint Nextel Corp.* | 140,760 | |||||
1,800 | Turkcell Iletisim Hizmetleri | ||||||
AS - ADR* | 27,252 | ||||||
2,063,044 | |||||||
Textiles, Apparel & Luxury Goods — 2.6% | |||||||
2,500 | Carter’s, Inc.* | 134,600 | |||||
2,000 | Coach, Inc. | 112,040 | |||||
8,100 | Crocs, Inc.* | 131,301 | |||||
1,000 | Perry Ellis International, Inc.* | 22,050 | |||||
11,100 | Fifth & Pacific Companies, Inc.* | 141,858 | |||||
700 | Fossil, Inc.* | 59,290 | |||||
4,300 | Gildan Activewear Inc. | 136,224 | |||||
4,600 | Iconix Brand Group, Inc.* | 83,904 | |||||
16,700 | Joe’s Jeans, Inc.* | 18,036 | |||||
11,100 | Lululemon Athletica Inc.* | 820,734 | |||||
10,300 | Luxottica Group - SpA - ADR | 363,178 | |||||
800 | Steven Madden, Ltd.* | 34,976 | |||||
2,200 | Michael Kors Holdings Ltd.* | 116,996 | |||||
7,400 | Movado Group, Inc. | 249,528 | |||||
8,300 | NIKE, Inc. Cl B | 787,753 | |||||
6,300 | PVH Corp. | 590,436 | |||||
2,100 | Ralph Lauren Corporation | 317,583 | |||||
3,600 | Skechers U.S.A., Inc.* | 73,440 | |||||
8,600 | Under Armour, Inc.* | 480,138 | |||||
800 | VF Corp. | 127,488 | |||||
4,801,553 | |||||||
Thrifts & Mortgage Finance — 0.1% | |||||||
3,900 | Nationstar Mortgage Holdings, Inc.* | 129,402 | |||||
700 | Ocwen Financial Corporation* | 19,187 | |||||
148,589 | |||||||
Tobacco — 0.0% | |||||||
1,900 | Altria Group Inc. | 63,441 | |||||
Trading Companies & Distributors — 0.5% | |||||||
7,500 | Fastenal Co. | 322,425 | |||||
1,900 | W.W. Grainger, Inc. | 395,903 | |||||
3,600 | United Rentals, Inc.* | 117,756 | |||||
1,000 | WESCO International, Inc.* | 57,200 | |||||
893,284 | |||||||
Total common stocks | |||||||
(cost $155,558,180) | 180,530,218 | ||||||
PUBLICLY TRADED PARTNERSHIPS — 0.1% (a) | |||||||
Chemicals — 0.1% | |||||||
1,700 | Rentech Nitrogen Partners LP | 65,892 | |||||
Oil, Gas & Consumable Fuels — 0.0% | |||||||
1,400 | Linn Energy LLC | 57,736 | |||||
Total publicly traded partnerships | |||||||
(cost $114,033) | 123,628 | ||||||
REITS — 1.1% (a) | |||||||
Real Estate Investment Trusts — 1.1% | |||||||
5,300 | American Tower Corp. | 378,367 | |||||
3,200 | Extra Space Storage Inc. | 106,400 | |||||
2,200 | iStar Financial Inc.* | 18,216 | |||||
7,100 | OMEGA Healthcare Investors, Inc. | 161,383 | |||||
800 | Post Properties, Inc. | 38,368 | |||||
1,000 | Potlatch Corporation | 37,370 | |||||
1,500 | Rayonier Inc. | 73,515 | |||||
2,300 | Simon Property Group, Inc. | 349,163 | |||||
3,000 | Sovran Self Storage, Inc. | 173,550 | |||||
3,800 | Tanger Factory Outlet Centers, Inc. | 122,854 | |||||
3,200 | Taubman Centers, Inc. | 245,536 | |||||
1,100 | Ventas, Inc. | 68,475 |
The accompanying notes to financial statements are an integral part of this schedule.
- 22 -
Reynolds Blue Chip Growth Fund
SCHEDULE OF INVESTMENTS (Continued)
September 30, 2012
Shares | Value | ||||||
LONG-TERM INVESTMENTS — 98.5% (a) (Continued) | |||||||
REITS — 1.1% (a) (Continued) | |||||||
Real Estate Investment | |||||||
Trusts — 1.1% (Continued) | |||||||
3,600 | Western Asset Mortgage | ||||||
Capital Corp. | $ | 79,920 | |||||
9,100 | Weyerhaeuser Company | 237,874 | |||||
Total REITS | |||||||
(cost $1,973,193) | 2,090,991 | ||||||
WARRANTS — 0.0% (a) | |||||||
3,150 | American International Group, Inc.*, | ||||||
Expiration Date - 01/19/21, | |||||||
Exercise Price - $45.00 | 42,367 | ||||||
Total warrants | |||||||
(cost $47,259) | 42,367 | ||||||
PREFERRED STOCKS — 0.3% (a) | |||||||
Beverages — 0.3% | |||||||
14,500 | Companhia de Bebidas das | ||||||
Americas Preferred - SP-ADR | 554,915 | ||||||
Total preferred stocks | |||||||
(cost $451,708) | 554,915 | ||||||
Total investments — 98.5% | |||||||
(cost $158,144,373) | 183,342,119 | ||||||
Cash and receivables, | |||||||
less liabilities — 1.5% (a) | 2,730,619 | ||||||
TOTAL NET ASSETS — 100.0% | $ | 186,072,738 |
* | Non-income producing security. |
^ | Passive Foreign Investment Company (PFIC). |
(a) | Percentages for the various classifications relate to net assets. |
(b) | This security was fair valued as determined by the adviser using procedures approved by the Board of Directors and is classified as level 3. As of September 30, 2012, the value of this security was $0 which represents 0.0% of total net assets. |
ADR – Unsponsored American Depositary Receipt
AG – German Corporation
A/S – Danish Company
KGaA – German Master Limited Partnership
LP – Limited Partnership
N.V. – Dutch Public Limited Liability Co.
NYS – New York Registered Shares
PLC – Public Limited Company
S.A. – Sociedad Anónima
S.A.B. de C.V. – Sociedad Anónima Bursetil de Capital Variable
SP - ADR – Sponsored American Depositary Receipt
SpA – Italian Corporation
The Global Industry Classification Standard (“GICS®”) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI & S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
The accompanying notes to financial statements are an integral part of this schedule.
- 23 -
Reynolds Blue Chip Growth Fund
STATEMENT OF OPERATIONS
For the Year Ended September 30, 2012
INVESTMENT INCOME: | ||||
Dividends (net of foreign withholding tax of $33,000) | $ | 2,370,837 | ||
Total investment income | 2,370,837 | |||
EXPENSES: | ||||
Management fees | 2,014,541 | |||
Transfer agent fees | 252,918 | |||
Administrative and accounting services | 235,454 | |||
Distribution fees | 161,752 | |||
Custodian fees | 161,698 | |||
Printing and postage expense | 51,102 | |||
Professional fees | 44,438 | |||
Insurance expense | 37,856 | |||
Registration fees | 32,998 | |||
Board of Directors fees | 28,000 | |||
Chief Compliance Officer fees | 23,967 | |||
Overdraft fees | 17,740 | |||
Other expenses | 14,206 | |||
Total expenses | 3,076,670 | |||
NET INVESTMENT LOSS | (705,833 | ) | ||
NET REALIZED GAIN ON INVESTMENTS | 2,601,844 | |||
NET INCREASE IN UNREALIZED APPRECIATION ON INVESTMENTS | 46,128,097 | |||
NET GAIN ON INVESTMENTS | 48,729,941 | |||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 48,024,108 |
For the Years Ended September 30, 2012 and 2011
2012 | 2011 | |||||||
OPERATIONS: | ||||||||
Net investment loss | $ | (705,833 | ) | $ | (1,051,603 | ) | ||
Net realized gain on investments | 2,601,844 | 11,306,780 | ||||||
Net increase (decrease) in unrealized appreciation on investments | 46,128,097 | (34,361,365 | ) | |||||
Net increase (decrease) in net assets resulting from operations | 48,024,108 | (24,106,188 | ) | |||||
FUND SHARE ACTIVITIES: | ||||||||
Proceeds from shares issued (914,026 and 4,121,709 shares, respectively) | 50,025,921 | 229,076,800 | ||||||
Cost of shares redeemed (2,042,077 and 2,241,424 shares, respectively) | (111,159,830 | ) | (121,830,577 | ) | ||||
Net (decrease) increase in net assets derived from Fund share activities | (61,133,909 | ) | 107,246,223 | |||||
TOTAL (DECREASE) INCREASE | (13,109,801 | ) | 83,140,035 | |||||
NET ASSETS AT THE BEGINNING OF THE YEAR | 199,182,539 | 116,042,504 | ||||||
NET ASSETS AT THE END OF THE YEAR (Includes accumulated | ||||||||
net investment loss of $(623,313) and undistributed net investment income of $0) | $ | 186,072,738 | $ | 199,182,539 |
The accompanying notes to financial statements are an integral part of these statements.
- 24 -
Reynolds Blue Chip Growth Fund
FINANCIAL HIGHLIGHTS
(Selected data for each share of the Fund outstanding throughout each year)
Years Ended September 30, | ||||||||||||||||||||
2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | ||||||||||||||||||||
Net asset value, beginning of year | $ | 46.50 | $ | 48.29 | $ | 41.87 | $ | 31.85 | $ | 32.05 | ||||||||||
Income from investment operations: | ||||||||||||||||||||
Net investment loss (a) | (0.19 | ) | (0.27 | ) | (0.25 | ) | (0.42 | ) | (0.01 | ) | ||||||||||
Net realized and unrealized | ||||||||||||||||||||
gains (loss) on investments | 12.66 | (1.52 | ) | 6.67 | 10.44 | 0.02 | ||||||||||||||
Total from investment operations | 12.47 | (1.79 | ) | 6.42 | 10.02 | 0.01 | ||||||||||||||
Less distributions: | ||||||||||||||||||||
Distributions from net investment income | — | — | — | — | (0.21 | ) | ||||||||||||||
Distributions from net realized gains | — | — | — | — | — | |||||||||||||||
Total from distributions | — | — | — | — | (0.21 | ) | ||||||||||||||
Net asset value, end of year | $ | 58.97 | $ | 46.50 | $ | 48.29 | $ | 41.87 | $ | 31.85 | ||||||||||
TOTAL RETURN | 26.82 | % | (3.71 | %) | 15.33 | % | 31.46 | % | (0.00 | %) | ||||||||||
RATIOS/SUPPLEMENTAL DATA: | ||||||||||||||||||||
Net assets, end of year (in 000’s $) | 186,073 | 199,183 | 116,043 | 48,553 | 22,151 | |||||||||||||||
Ratio of expenses (after reimbursement) to average net assets* | 1.53 | % | 1.55 | % | 1.80 | % | 2.00 | % | 2.00 | % | ||||||||||
Ratio of net investment loss to average net assets** | (0.34 | %) | (0.49 | %) | (0.55 | %) | (1.24 | %) | (0.03 | %) | ||||||||||
Portfolio turnover rate | 99 | % | 55 | % | 80 | % | 527 | % | 364 | % | ||||||||||
(a) | Amount calculated based on average shares outstanding throughout the year. |
* | Computed after giving effect to adviser’s expense limitation undertaking. If the Fund had paid all of its expenses for the years ended September 30, 2009 and 2008, the ratios would have been 2.51% and 2.67%, respectively. |
** | If the Fund had paid all of its expenses for the years ended September 30, 2009 and 2008, the ratios would have been (1.75%) and (0.70%), respectively. |
The accompanying notes to financial statements are an integral part of this statement.
September 30, 2012
(1) | Summary of Significant Accounting Policies — |
The following is a summary of significant accounting policies of the Reynolds Funds, Inc. (the “Company”), which is registered as a diversified, open-end management investment company under the Investment Company Act of 1940 (the “Act”), as amended. This Company consists of one fund: the Reynolds Blue Chip Growth Fund (the “Fund”). The Company was incorporated under the laws of Maryland on April 28,1988.
The investment objective of the Fund is to produce long-term growth of capital by investing in a diversified portfolio of common stocks issued by well-established growth companies commonly referred to as “blue chip” companies.
(a) Each security, excluding short-term investments, is valued at the last sale price reported by the principal security exchange on which the issue is traded, or if no sale is reported, the latest bid price. Securities which are traded on the Nasdaq National Markets are valued at the Nasdaq Official Closing Price, or if no sale is reported, the latest bid price. Short-term investments with maturities of 60 days or less are valued at amortized cost which approximates value. Securities for which quotations are not readily available are valued at fair value as determined by the investment adviser under the supervision of the Board of Directors. The fair value of a security is the amount which the Fund might receive upon a current sale. The fair value of a security may differ from the last quoted price and the Fund may not be able to sell a security at the fair value. Market quotations may not be available, for example, if trading in particular securities was halted during the day and not resumed prior to the close of trading on the New York Stock Exchange.
- 25 -
Reynolds Blue Chip Growth Fund
NOTES TO FINANCIAL STATEMENTS (Continued)
September 30, 2012
(1) | Summary of Significant Accounting Policies — (Continued) |
Under accounting principles generally accepted in the United States of America (“GAAP”), fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date.
In determining fair value, the Fund uses various valuation approaches. GAAP establishes a fair value hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by generally requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund's assumptions about the inputs market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The inputs or methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.
The fair value hierarchy is categorized into three levels based on the inputs as follows:
Level 1— | Valuations based on unadjusted quoted prices in active markets for identical assets. |
Level 2— | Valuations based on quoted prices for similar securities or in markets that are not active or for which all significant inputs are observable, either directly or indirectly. |
Level 3— | Valuations based on inputs that are unobservable and significant to the overall fair value measurement. |
The following table summarizes the Fund’s investments as of September 30, 2012, based on the inputs used to value them:
Valuation Inputs | Investments in Securities | |||
Level 1—Common Stocks | $ | 180,530,218 | ||
Publicly Traded Partnerships | 123,628 | |||
REITS | 2,090,991 | |||
Warrants | 42,367 | |||
Preferred Stocks | 554,915 | |||
Total Level 1 | 183,342,119 | |||
Level 2— | — | |||
Level 3—Common Stocks | 0 | |||
Total | $ | 183,342,119 | * |
It is the Fund’s policy to recognize transfers between levels at the end of the quarterly reporting period. For the year ended September 30, 2012, the following transfers were made:
Transfers into Level 1 and out of Level 2: $402.
The security transferred out of Level 2 and into Level 1 as a result of a trade price being available as of September 30, 2012.
Transfers out of Level 1 and into Level 3: $0.
The security transferred out of Level 1 and into Level 3 as a result of the security filing bankruptcy and no additional observable inputs being available as of September 30, 2012.
* Please refer to the Schedule of Investments to view common stocks, publicly traded partnerships and preferred stocks segregated by industry type.
(b) Investment transactions are accounted for on a trade date basis for financial reporting purposes. Net realized gains and losses on sales of securities are computed on the highest amortized cost basis.
(c) The Fund records dividend income on the ex-dividend date and interest income on an accrual basis. Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable country’s tax rules and regulations.
(d) GAAP requires that permanent differences between income for financial reporting and tax purposes be reclassified in the capital accounts. For the year ended September 30, 2012, the Fund reclassified $82,520 of net investment loss and $18,042 of accumulated realized losses to capital stock.
- 26 -
Reynolds Blue Chip Growth Fund
NOTES TO FINANCIAL STATEMENTS (Continued)
September 30, 2012
(1) | Summary of Significant Accounting Policies — (Continued) |
(e) The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.
(f) No provision has been made for Federal income taxes since the Fund has elected to be taxed as a “regulated investment company” and intends to distribute substantially all net investment company taxable income and net capital gains to shareholders and otherwise comply with the provisions of the Internal Revenue Code applicable to regulated investment companies.
(g) The Fund has reviewed all open tax years and major jurisdictions, which include Federal and the state of Maryland, and concluded that there are no significant uncertain tax positions that would require recognition in the financial statements as of and for the year ended September 30, 2012. Open tax years are those that are open for exam by taxing authorities and, as of September 30, 2012, open Federal tax years include the tax years ended September 30, 2009 through 2012. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Fund’s Statement of Operations. During the year ended September 30, 2012, the Fund did not incur any interest or penalties. The Fund has no examinations in progress and is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
(2) | Investment Adviser and Management Agreement and Transactions With Related Parties — |
The Fund has a management agreement with Reynolds Capital Management, LLC (“RCM”), to serve as investment adviser and manager. The sole owner of RCM is Mr. Frederick L. Reynolds. Mr. Reynolds is also an officer and interested director of the Fund. Under the terms of the agreement, the Fund will pay RCM a monthly management fee at the annual rate of 1% of the daily net assets.
The agreement further stipulates that RCM will reimburse the Fund for all expenses exceeding 2% of its daily average net assets (excluding interest, taxes, brokerage commissions and extraordinary items). The Fund is not obligated to reimburse RCM for any expenses reimbursed in previous fiscal years. No such reimbursements were required for the year ended September 30, 2012.
The Fund has adopted a Service and Distribution Plan (the “Plan”) pursuant to Rule 12b-1 under the Act. The Plan provides that the Fund may incur certain costs which may not exceed a maximum amount equal to 0.25% per annum of the Fund’s average daily net assets. Payments made pursuant to the Plan may only be used to pay distribution expenses incurred in the current year, and may be less than the maximum amount allowed by the Plan.
Under the Fund’s organizational documents, each director, officer, employee or other agent of the Fund (including the Fund’s investment manager) is indemnified, to the extent permitted by the Act, against certain liabilities that may arise out of performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund has not had prior claims or losses pursuant to these contracts and believes the risk of loss to be remote.
(3) | Distributions to Shareholders — |
Net investment income and net realized gains, if any, for the Fund are distributed to shareholders at least annually and are recorded on the ex-dividend date. On November 26, 2012, the Fund declared a distribution of $1,885,771 from long-term capital gains ($0.62743 per share). The distribution will be paid on November 26, 2012 to shareholders of record on November 23, 2012.
(4) | Investment Transactions — |
For the year ended September 30, 2012, purchases and proceeds of sales of investment securities (excluding short-term securities) were $197,707,923 and $258,604,983, respectively.
(5) | Income Tax Information — |
The following information for the Fund is presented on an income tax basis as of September 30, 2012:
Gross | Gross | Net Unrealized | Distributable | Distributable | |
Cost of | Unrealized | Unrealized | Appreciation | Ordinary | Long-Term |
Investments | Appreciation | Depreciation | on Investments | Income | Capital Gains |
$162,967,353 | $31,043,221 | $(10,668,455) | $20,374,766 | $ — | $1,885,771 |
- 27 -
Reynolds Blue Chip Growth Fund
NOTES TO FINANCIAL STATEMENTS (Continued)
September 30, 2012
(5) | Income Tax Information — (Continued) |
The difference, if any, between the cost amount for financial statement and federal income tax purposes is due primarily to timing differences in recognizing certain gains and losses in security transactions.
On December 22, 2010, the Regulated Investment Company Modernization Act of 2010 (the “RIC Act”) was enacted, which changed various technical rules governing the tax treatment of regulated investment companies. The changes are generally effective for taxable years beginning after the date of enactment. Capital losses incurred in taxable years beginning after the date of enactment may now be carried forward indefinitely, and retain the character of the original loss. Post-enactment losses must be utilized prior to pre-enactment losses. Under pre-enactment law, capital losses could be carried forward for up to eight years, and carried forward as short-term capital loss, irrespective of the character of the original loss. The RIC Act now allows regulated investment companies to elect to “push” to the first day of the next taxable year all or part of any late year ordinary loss, which is defined as the sum of the specified post-October losses and other post-December ordinary losses, over the specified post-October gains and other post-December ordinary gains. This reduces the circumstances under which a regulated investment company might be required to file amended Forms 1099 to restate previously reported distributions.
The tax components of dividends paid during the year ended September 30, 2012, capital loss carryovers, which may be used to offset future capital gains, subject to Internal Revenue Code limitations, tax basis post-October losses as of September 30, 2012, which are not recognized for tax purposes until the first day of the following fiscal year, and late year ordinary losses are:
September 30, 2012 | September 30, 2011 | |||||||||||||
Pre-Enactment | Post-Enactment | |||||||||||||
Ordinary | Long-Term | Net Capital | Short-Term | Late Year | Ordinary | Long-Term | ||||||||
Income | Capital Gains | Loss | Capital Loss | Post-October | Ordinary | Income | Capital Gains | |||||||
Distributions | Distributions | Carryovers | Carryovers | Losses | Losses | Distributions | Distributions | |||||||
$ — | $ — | $ — | $ — | $ — | $630,763 | $ — | $ — |
The Fund has utilized $3,755,501 of its capital loss carryovers during the year ended September 30, 2012.
Since there were no ordinary distributions paid for the year ended September 30, 2012, there were no distributions designated as qualifying for the dividends received deduction for corporate shareholders nor as qualified dividend income under the Jobs and Growth Tax Relief Act of 2003.
- 28 -
Reynolds Blue Chip Growth Fund
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
Reynolds Funds, Inc.
We have audited the accompanying statement of assets and liabilities, of Reynolds Funds, Inc., comprising Reynolds Blue Chip Growth Fund (the “Fund”), including the schedule of investments, as of September 30, 2012, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the four years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The financial highlights for the year ended September 30, 2008 was audited by another independent registered public accounting firm, who expressed unqualified opinions on those financial highlights.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of September 30, 2012, by correspondence with the custodian and broker. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Reynolds Funds, Inc. as of September 30, 2012, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the four years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
COHEN FUND AUDIT SERVICES, LTD.
Cleveland, Ohio
November 26, 2012
- 29 -
Reynolds Blue Chip Growth Fund
DIRECTORS AND OFFICERS
Other | |||||
Term of | # of Funds | Directorships | |||
Position(s) | Office and | in Complex | Held by | ||
Name, Age | Held with | Length of | Principal Occupation(s) | Overseen | Director |
and Address | the Fund | Time Served | During Past Five Years | by Director | or Officer |
Non-Interested Directors: | |||||
Dennis N. Moser, 70 | Director | Indefinite Term | Mr. Moser is a partner in Glenbrook Partner, | 1 | None |
77 Stockbridge | Since 2002 | LLC, a payments consulting firm. | |||
Atherton, CA 94027 | |||||
Robert E. Stauder, 82 | Director | Indefinite Term | Mr. Stauder is retired. He was a principal of | 1 | None |
436 Casabonne Lane | Since 1988 | Robinson Mills + Williams, an architectural | |||
Sonoma, CA 95476 | and interior design firm, from 1991 until 1996. | ||||
Interested Director: | |||||
Frederick L. Reynolds,* 70 | Director, | Indefinite Term | Mr. Reynolds is the sole owner of | 1 | None |
3565 South Las Vegas | Since 1988 | the Adviser, which business commenced in 1985. | |||
Blvd. #403 | President | One Year Term | |||
Las Vegas, NV 89109 | and | Since 1988 | |||
Treasurer | |||||
Other Officer: | |||||
N. Lynn Bowley, 54 | Chief | At Discretion | Mr. Bowley has been a Compliance Officer for | N/A | None |
Northern Lights | Compliance | of Board | Northern Lights Compliance Services, LLC, | ||
Compliance Services, LLC | Officer | Since 2007 | (f/k/a) Fund Compliance Services, LLC, since | ||
17605 Wright Street | 2007. | ||||
Omaha, NE 68130 |
__________
* | Mr. Reynolds is the only interested director of the Company as that term is defined in the Investment Company Act of 1940. Mr. Reynolds is an interested director of the Company by reason of his being an officer of the Company and the sole owner of the investment adviser. |
For additional information about the Directors and Officers or for a description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities, please call (800) 773-9665 and request a Statement of Additional Information. One will be mailed to you free of charge. The Statement of Additional Information is also available on the website of the Securities and Exchange Commission (the “Commission”) at http://www.sec.gov. Information on how the Fund voted proxies relating to portfolio securities is available on the Fund’s website at http://www.reynoldsfunds.com or the website of the Commission no later than August 31 for the prior 12 months ending June 30. The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Form N-Q is available on the Commission’s website. The Fund’s Form N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C., and that information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
- 30 -
Reynolds Funds, Inc.
PRIVACY POLICY
We collect the following nonpublic personal information about you:
• Information we receive from you on or in applications or other forms, correspondence or conversations.
• Information about your transactions with us, our affiliates, or others.
We do not disclose any nonpublic personal information about our current or former shareholders to anyone, except as permitted by law. For example, we are permitted by law to disclose all of the information we collect, as described above, to our transfer agent to process your transactions. Furthermore, we restrict access to your nonpublic personal information to those persons who require such information to provide products or services to you. We maintain physical, electronic and procedural safeguards that comply with federal standards to guard your nonpublic personal information.
In the event that you hold shares of the Fund through a financial intermediary, including, but not limited to, a broker-dealer, bank or trust company, the privacy policy of your financial intermediary may govern how your nonpublic personal information would be shared with nonaffiliated third parties.
HOUSEHOLDING
In an effort to decrease costs, the Fund intends to reduce the number of duplicate prospectuses and annual and semi-annual reports you receive by sending only one copy of each to those addresses shared by two or more accounts and to shareholders the Fund reasonably believes are from the same family or household. Once implemented, if you would like to discontinue householding for your accounts, please call toll-free at 1-800-773-9665 to request individual copies of these documents. Once the Fund receives notice to stop householding, the Fund will begin sending individual copies 30 days after receiving your request. This policy does not apply to account statements.
- 31 -
REYNOLDS BLUE CHIP GROWTH FUND
c/o U.S. BANCORP FUND SERVICES, LLC
615 East Michigan Street
Milwaukee, Wisconsin 53202
www.reynoldsfunds.com
Board of Directors
DENNIS N. MOSER
FREDERICK L. REYNOLDS
ROBERT E. STAUDER
Investment Adviser
REYNOLDS CAPITAL MANAGEMENT, LLC
3565 South Las Vegas Boulevard, #403
Las Vegas, Nevada 89109
Transfer Agent,
Dividend Disbursing Agent,
Administrator and Accountant
U.S. BANCORP FUND SERVICES, LLC
615 East Michigan Street
Milwaukee, Wisconsin 53202
1-800-773-9665
or 1-800-7REYNOLDS
1-414-765-4124
Custodian
U.S. Bank, N.A.
1555 North RiverCenter Drive, Suite 302
Milwaukee, Wisconsin 53212
Independent Registered Public Accounting Firm
COHEN FUND AUDIT SERVICES, LTD.
1350 Euclid Avenue, Suite 800
Cleveland, Ohio 44115
Legal Counsel
FOLEY & LARDNER LLP
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Item 2. Code of Ethics.
Registrant has adopted a code of ethics. See attached Exhibit 12 (a) (1).
Item 3. Audit Committee Financial Expert.
Registrant’s Board of Directors has determined that it does not have an “audit committee financial expert” serving on its audit committee. While Registrant believes that each of the members of its audit committee has sufficient knowledge of accounting principles and financial statements to serve on the audit committee, none has the requisite experience to qualify as an “audit committee financial expert” as such term is defined by the Securities and Exchange Commission.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees
$14,000 (FY 2012) and $14,000 (FY 2011) are the aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant to the registrant for the audit of the registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years.
(b) Audit-Related Fees
There were no fees billed in the last two fiscal years for Audit-Related Fees.
(c) | Tax Fees |
There were no fees billed in the last two fiscal years for professional services rendered by the principal accountant to the registrant for tax compliance, tax advice, tax planning and tax return preparation.
There were no fees billed in the last two fiscal years for professional services rendered by the principal accountant to registrant’s investment adviser for tax compliance, tax advice and tax planning that were required to be approved by the audit committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X.
(d) All Other Fees
There were no other fees billed in each the last two fiscal years for products and services provided by the principal accountant to the registrant, other than the services reported in paragraphs (a) – (c) of this Item 4.
There were no fees billed in the last two fiscal years for products and services provided by the principal accountant to registrant’s investment adviser, which were required to be approved by the audit committee pursuant to paragraph (c)(7)(ii) or Rule 2-01 or Regulation S-X.
(e) (1) None
(e) (2) None
(f) Not applicable.
(g) See the tax fees disclosed in paragraph (c) of this Item 4.
(h) Not applicable, as no non-audit services were provided to registrant’s investment adviser.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
(a) The Schedule of Investments in securities of unaffiliated issuers 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.
None.
Item 11. Controls and Procedures.
(a) | The Registrant’s disclosure controls and procedures are periodically evaluated. As of November 27, 2012, the date of the last evaluation, the Registrant’s officers have concluded that the Registrant’s disclosure controls and procedures are adequate. |
(b) | The Registrant’s internal controls are periodically evaluated. There were no changes in the Registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, such controls. |
Item 12. Exhibits.
(a) | (1) Any code of ethics or amendment thereto. Filed herewith. |
(2) Certifications 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) | Certification 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.
Reynolds Funds, Inc.
Registrant
By /s/Frederick L. Reynolds
Frederick L. Reynolds, Principal Executive Officer
Date November 30, 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.
Reynolds Funds, Inc.
Registrant
By /s/Frederick L. Reynolds
Frederick L. Reynolds, Principal Financial Officer
Date November 30, 2012