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: 811-09561
Century Capital Management Trust
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(Exact name of registrant as specified in charter)
c/o Century Capital Management, LLC
100 Federal Street, Boston, Massachusetts 02110
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(Address of principal executive offices) (Zip code)
Maureen Kane
Century Capital Management, LLC
100 Federal Street, Boston, Massachusetts 02110
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(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 482-3060
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Date of fiscal year end: October 31
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Date of reporting period: October 31, 2007
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CENTURY CAPITAL MANAGEMENT
Seventy-Nine Years of Investing
1928 - 2007
CENTURY
CENTURY
FUNDS
Annual Reports
October 31, 2007
Century
Shares
Trust
and
Century
Small Cap
Select Fund
CENTURY FUNDS
AVERAGE ANNUAL TOTAL RETURNS AS OF OCTOBER 31, 2007
10 YEARS/
SINCE
CENTURY SHARES TRUST 1 YEAR 3 YEARS 5 YEARS INCEPTION
Institutional Shares (3/15/1928)* 11.86% 11.07% 11.82% 8.16%**
Investor Shares (7/18/05)* 11.38% 9.41%
CENTURY SMALL CAP
SELECT FUND SINCE
1 YEAR 3 YEARS 5 YEARS INCEPTION
Institutional Shares (12/09/99)* 11.61% 9.99% 16.01% 16.59%
Investor Shares (02/24/00)* 11.34% 9.67% 15.62% 16.43%
* Inception Date
** Ten Years
Performance data quoted represents past performance and is no guarantee of
future results. Current performance may be lower or higher than the performance
data quoted. Investment return and principal value will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than original cost.
For the most recent month end performance, please call 1-800-321-1928 or visit
the Funds' website at www.centuryfunds.com.
As stated in the prospectus dated February 28, 2007, the total annual fund
operating expenses, gross of any fee waivers or expense reimbursements, for
Century Small Cap Select Fund are 1.45% for the Investor Shares and 1.07% for
the Institutional Shares, and the total annual fund operating expenses, gross of
any fee waivers or expense reimbursements, for Century Shares Trust are 2.15%
for the Investor Shares and 1.11% for the Institutional Shares. The Adviser has
agreed contractually to waive a portion of its fees and/or reimburse operating
expenses for the Investor Shares of Century Shares Trust to maintain total
operating expenses at 1.45% through February 28, 2008. Please see the Financial
Highlights and Notes to the Financial Statements sections of this report for
gross and net expense related disclosure for the fiscal year ended October 31,
2007. Shares held less than 90 days for both Funds may be subject to a 1.0%
redemption fee.
Returns include the reinvestment of dividends and capital gains. Performance for
Century Small Cap Select Fund and the Investor Shares of Century Shares Trust
would have been lower during relevant periods if certain fees had not been
waived or expenses reimbursed. Performance information for the Funds does not
reflect the deduction of taxes that shareholders would pay on Fund distributions
or the redemption of Fund shares.
CENTURY SMALL CAP SELECT FUND CONCENTRATES ITS INVESTMENTS IN THE FINANCIAL
SERVICES AND HEALTH CARE GROUP OF INDUSTRIES. CONCENTRATION IN A PARTICULAR
INDUSTRY SUBJECTS THE FUND TO THE RISKS ASSOCIATED WITH THAT INDUSTRY AND, AS A
RESULT, MAY BE SUBJECT TO GREATER PRICE VOLATILITY THAN FUNDS WITH LESS
CONCENTRATED PORTFOLIOS. IN ADDITION, THE FUND INVESTS IN SMALLER COMPANIES
WHICH POSE GREATER RISKS THAN THOSE ASSOCIATED WITH LARGER, MORE ESTABLISHED
COMPANIES.
This report is submitted for the general information of the shareholders of the
Funds. It is not authorized for distribution to prospective investors unless
preceded or accompanied by the Funds' prospectus.
The Russell 2000 Growth Index is a market capitalization-weighted index of the
stocks of the 2,000 smallest companies included in the Russell 3000(R) Growth
Index, which comprises the 3,000 largest U.S. domiciled companies that exhibit
growth-oriented characteristics. Index returns reflect no deduction for fees,
expenses or taxes. The indices are not available for investment. On February 28,
2007, the Russell 2000 Growth Index replaced the Russell 2000 Index as the
comparative index for the Fund. The Adviser believes that the Russell 2000
Growth Index is a more appropriate benchmark because the Fund invests
principally in companies that exhibit growth characteristics similar to those of
companies included in the Russell 2000 Growth Index.
Price/Earnings ratio is the value of a company's stock price relative to company
earnings. Price/Book ratio is the ratio of a stock's latest closing price
divided by its book value per share. Book value is the total assets of a company
minus total liabilities.
The views in this report were those of Century Funds' Chief Investment Officer
and Portfolio Managers as of October 31, 2007 and may not reflect their views on
the date this report is first published or anytime thereafter. These views are
intended to assist shareholders of the Funds in understanding their investments
and do not constitute investment advice. There is no assurance that the Funds
will continue to invest in the securities mentioned. Foreside Fund Services,
LLC, Distributor.
DEAR FELLOW SHAREHOLDERS,
The current market environment is at an important crossroads after several years
of above average economic growth, corporate profits and low unemployment. We
enjoyed these clear investment skies overhead, but credit and consumer clouds
have formed on the horizon and may foreshadow an inclement market - ahead of the
2008 election. During uncertain times like these, prudent investors must
patiently test their own convictions against the consensus view. We refer to
this practice as "paranoid investing," and it requires thinking long term,
beyond the next quarter.
"WHAT GETS US INTO TROUBLE IS NOT WHAT WE KNOW, IT'S WHAT WE KNOW FOR SURE THAT
JUST AIN'T SO."
- MARK TWAIN
The S&P 500 Index will likely end 2007 with its fifth consecutive year in
positive territory. This impressive performance marks the second longest run of
consecutive positive annual returns since 1950. Through October 31, 2007, the
S&P 500's average annual return for the past five years was an impressive 13.9%,
significantly above the long-term average of 8.6% (from 1935 through 9/30/2007).
During this most recent 5-year period, the market benefited from strong double
digit earnings growth, averaging 14.6% (refer to chart below), well in excess of
the long-term average of 8.5%.
S&P 500 Index Earnings Per Share Growth Rate
Year over Year % Change
(Excludes extraordinary and non-recurring items)
Bar Chart:
2002 7%
2003 15%
2004 21%
2005 14%
2006 16%
2007E 8%
2008E 6% ?
2009E ?
Source: BASELINE
Over the long run, we believe earnings and returns revert to the mean average,
with periods of outsized returns and earnings growth rates followed by periods
of subpar returns and growth rates. As the S&P 500 earnings per share (EPS)
chart shows, earnings growth turned up beginning in 2002, but slowed abruptly in
the third quarter of 2007. During periods of moderate to declining earnings
growth (such as the 2000 to 2002 time period), "quality growth" investing
performed better than "momentum" or aggressive growth investing. Since Century
invests in quality growth companies, we believe our funds are well-positioned to
withstand earnings growth weakness and, possibly benefit as investors upgrade
the quality of stocks in their portfolios.
PERFORMANCE
We are pleased to report that Century Small Cap Select Fund delivered its eighth
consecutive year of positive performance. We are particularly proud of this
record given the extremely poor performance of the Russell 2000 Growth Index in
2000, 2001 and 2002, when its returns were -22%, -9% and -30%, respectively. We
are equally proud that Century Shares Trust posted its fifth consecutive year of
positive performance. While we are pleased with our returns, we are disappointed
that we lagged our respective benchmarks. In retrospect, we were defensively
positioned too early. While this strategy helped us during the summer downturn,
we lagged during the first half of the year, when the stock market exhibited
strong performance. For a longer term perspective of Fund performance vs Index
performance, please reference pages 9 and 10.
WHAT'S NEW AT CENTURY?
We continue to reinvest in our research team. We seek candidates with relevant
expertise, experience, curiosity, humility and a sense of humor. We added two
new professionals to the investment team. Shannon Hunter, a Harvard University
graduate, joined us in July as an equity analyst. Bill Roddy joins us as
Director
CENTURY FUNDS 1
of Research and brings 20 years of leadership experience from William Blair &
Company, where he was a principal and member of the firm's Executive Committee.
At the board level, John Beard retired as a longtime Century Funds Trustee,
after many years of providing inspired guidance. John is an astute and
thoughtful leader, whose probing questions and subtle humor provided wise
counsel to all of us at Century. More importantly, his "moral compass" ensured
that our shareholders' best interests were always top-of-mind. He will be
greatly missed, but his spirit and legacy live on. We are pleased to welcome
both Ellen Zane and Laura Johnson as new Trustees. Ellen is the CEO at Tufts-New
England Medial Center, a large academic health system, and Laura is President of
Massachusetts Audubon Society, a leader in environmental advocacy, education and
conservation. We are thrilled to add their operating expertise, management
perspective and vitality to the Century Funds' Board.
WHY DO WE USE A SEXTANT ON THE COVER OF OUR ANNUAL REPORT?
We think it is a good metaphor for the research-intensity of our fundamental
investment process. A Sextant measures the angle of elevation above the horizon
and is commonly used to sight the sun at noon to find the ship's latitude.
Often, our research analysts have to measure many quantitative and qualitative
attributes about a company, its customers and its management team. Avoiding
disasters and finding safe passage are as important to prudent investing as they
are to navigating the open seas in an 18th century frigate.
INVESTMENT PHILOSOPHY: BALANCE RISK WITH REWARD
We believe focusing on preserving capital is as important as capital
appreciation in delivering favorable risk-adjusted returns over long time
horizons. Our growth investing strategy helps to identify attractive investment
opportunities, as well as mitigate risk in challenging market environments. We
believe this balance of managing risk and return means we own companies with
slightly slower growth rates but more potential consistency than more aggressive
"growth" managers.
Following five straight years of positive returns, it is easy to question
whether "risk" is less important than "potential growth" in assessing valuations
today. Our research sextant continues to focus on durable business franchises
with sustainable competitive advantages, regardless of economic conditions. We
seek managers who are excellent "stewards of capital" and have a track record of
acting in the interests of shareholders. Frequently, these leaders take
advantage of market downturns by reinvesting in their business (while
competitors struggle) and subsequently may grow market share and earnings at a
faster rate than peers.
OUR MISSION
We remain committed to Century's Investment Principles. Managing your assets
requires a consistent investment philosophy, disciplined research and patience.
We are optimistic about the outlook for our Funds over the next year and over
the long term. We thank you for entrusting your hard-earned assets to our firm.
The Century team understands this responsibility and hopes to earn your trust in
the future.
We hope you find the Annual Report informative and helpful in understanding your
investment. We appreciate and value your continued support and wish you health,
happiness and hearty returns in the coming year. We welcome your questions or
comments at 800-321-1928.
Sincerely,
/s/ Alexander L. Thorndike
Alexander L. Thorndike
Chairman of the Trustees
2 CENTURY FUNDS
CENTURY
CAPITAL MANAGEMENT
MISSION STATEMENT
TO EXCEED THE EXPECTATIONS OF OUR CLIENTS,
WHO ENTRUST US WITH THEIR HARD-EARNED ASSETS
Goals
> To deliver exceptional risk-adjusted returns over time
> To develop long-term and deeper relationships with our clients
> To do the right thing, even when no one is watching
> To attract, develop and retain the best people
VALUES
o DISCIPLINE
- We are passionate about our research intensity and adhering
to our investment process
o CONVICTION
- We challenge the consensus and act on our convictions
o EXCELLENCE
- We strive to be great at what we do, both individually
and collectively
o CURIOSITY
- Our goal is to learn every day
o THE 3 HS
(1) Humility: there is always room for improvement
(1) Humor: we have fun
(1) Hustle: we are tireless in our pursuit of success
CENTURY FUNDS 3
CENTURY SMALL CAP SELECT FUND
PERFORMANCE
For the twelve months ended October 31, 2007, the Fund's Institutional Shares
and the Investor Shares returns were 11.61% and 11.34%, respectively,
underperforming the Fund's benchmark, the Russell 2000 Growth Index return of
16.73% but outperforming the Russell 2000 Index return of 9.27%.
WHAT CONTRIBUTED TO PERFORMANCE
Top contributors for the year included investments in the Consumer
Discretionary, Energy and Health Care sectors. The Consumer Discretionary sector
benefited from an active merger and acquisition environment. Aquantive, a
digital media company acquired by Microsoft, was the most significant
contributor to performance. Guitar Center, a niche musical equipment retailer,
was bought out by a private equity firm. Berry Petroleum, an oil and natural gas
producer, profited from higher energy prices. Health Care was our best
performing sector as a result of strong stock selection. Healthways, a disease
management provider, performed well due to strong growth in its customer base.
Surmodics, which provides drug delivery technology, rose on the announcement of
an opthalmic partnership with Merck.
WHAT DETRACTED FROM PERFORMANCE
Investments in the Technology, Consumer Discretionary and Producer Durable
sectors hurt performance. Within Technology, Smart Modular Technologies was our
weakest performer, suffering from heightened competition for its high-end memory
chip modules. Epicor Software, an enterprise software developer, underperformed
due to a lengthening sales cycle. Within the Consumer and Producer Durable
sectors, Tuesday Morning, an upscale closeout retailer, and Ryland Group, a home
builder, were hurt by weakness in the housing market. Casual Male Retail Group,
a specialty retailer of men's apparel, experienced slowing sales growth.
DISCUSSION
At Century, we are constantly searching for areas of the economy that are
experiencing high levels of sustainable secular growth. The Health Care sector
is an example of an attractive segment, due to the rapid pace of innovation and
the need to contain the spiraling costs of medical care today. Hopefully, the
following commentary will 'shed some light' on our investment decision-making
process.
We believe research and development (R&D) spending within Health Care may
continue to grow at the recent high level of 10%-14% annually, since battling
disease and the onset of old age will never end. Medical technology,
pharmaceutical and biotechnology firms need to constantly improve the efficacy
and efficiency of their devices and replenish their drug pipelines.
As a result of this R&D spending growth, we initiated research on several Health
Care technology and service-based companies that are less capital-intensive and
less cyclical than a typical biotech company. We seek businesses with fairly
predictable and recurring revenue trends, resulting in a more consistent
return-on-equity over time. (Please see comparison table). Our approach led us
to invest in four companies that sell products and services into the R&D space.
o Massachusetts-based company - sells scientific instruments to clinical labs
and the industrial market.
o Ohio-based company - provides clinical research services to the
pharmaceutical and biotechnology industries.
o Germany-based company - builds purification kits that are frequently
purchased in clinical labs.
o Minnesota-based company - develops biological products for clinical labs.
The common theme among these companies is their service orientation, recurring
revenue model and the R&D focus of their client base. We believe that four
companies are well positioned to benefit from continuing growth in innovative
R&D spending.
We learn more from our losses than our successes, and it is important to detail
areas within the portfolio that struggled. Smart Modular Technologies ("Smart"),
our largest detractor for fiscal 2007, makes memory modules for many high-end
server and networking applications. Smart was purchased in early 2006 and
performed reasonably well up until this past July, with 35% earnings growth and
return-on-equity above 30%. However, DRAM (dynamic random access memory) pricing
declined precipitously (about 60%) versus the normal historical pattern of 20%
price decline per year. Since Smart was unable to offset the sudden DRAM price
decline, its operating margins fell, and the stock suffered. In the end, we
learned that the company's earnings were more sensitive to changes in DRAM
oversupply than our research had anticipated.
Our goal is to invest in companies that have historically grown their earnings
and book value at above-market rates while generating unlevered returns well
above the market. We want to pay reasonable valuations for those attractive cash
flows. We believe these are the keys to providing a competitive risk-adjusted
return over time. The tables below help to illustrate this point. Generally, we
seek to purchase companies growing faster than the benchmark, while paying less
than the market averages for that growth.
4 CENTURY FUNDS
CENTURY SHARES TRUST
PERFORMANCE
For the twelve months ended October 31, 2007, the Trust's Institutional Shares
and the Investor Shares returns were 11.86% and 11.38%, respectively, versus
14.56% for the S&P 500 Index.
WHAT CONTRIBUTED TO PERFORMANCE
Top contributors for the year included investments in the Technology, Financial
Services and Health Care sectors. Within Technology, Nokia, a provider of mobile
communication devices, was the top contributor due to international growth.
Cisco Systems, a manufacturer of networking communications products, continued
to benefit from increased demand for voice and video services over the internet.
Microsoft, a worldwide software provider, witnessed strength across its business
segments (Windows, Office, Servers and Games). In the Financial sector,
Berkshire Hathaway, a property and casualty (re)insurer, outperformed due to a
flight to quality and the $45 billion in cash on its rock-solid balance sheet.
In Health Care (where the Trust has a meaningful overweight relative to the S&P
500), Covance, a clinical research company, saw strong demand for its services
and a backlog that stands at $ 1 billion.
WHAT DETRACTED FROM PERFORMANCE
The primary detractor of performance was the underweight positions (relative to
the S&P 500 sector weightings) in Materials & Processing and Energy sectors
which did well last year. In addition, our modest overweight in the Consumer
Discretionary sector hurt performance. The Progressive Corporation, an auto
insurer, was the top detractor for the year due to increased industry
competition. In addition, four companies within the Consumer Discretionary
sector negatively affected performance: McGraw-Hill, a provider of educational
and financial information services; Bed Bath & Beyond, a retailer of home
furnishings; Staples, an office products retailer, and Home Depot, a home
improvement retailer. McGraw-Hill suffered as a result of its Standard & Poor's
unit's exposure to the dislocation in the capital markets. The other three
Consumer Discretionary stocks were hurt by the slowing economy and weakening
housing market.
DISCUSSION
The most significant change to the Trust over the past two years is the
reduction of the Financial Services sector weighting. This change seems to have
been a good call, in light of the recent downturn in the capital markets from
the subprime credit crisis. In last year's Annual Report, we shared with you our
rationale for reducing the Financial Services allocation. Our analysis indicated
other areas presented better risk/return opportunities this stage of the
economic cycle.
Many of the Trust's insurance holdings had reached all-time highs in 2006 and
exceeded our price targets. The insurance segment benefited from an unusually
prolonged cycle of favorable tailwinds that we feared were on the verge of
nearing an end. Our research showed insurance pricing, margins and growth
beginning to erode. We believed it was prudent to sell some of these companies
and redeploy the proceeds into potentially favorable areas.
In the short-term, it appears that our thesis was accurate. The S&P Insurance
Index (The S&P Insurance Index is a capitalization-weighted index of domestic
insurance equities traded on the New York Stock Exchange and NASDAQ. The stocks
in the Index are high capitalization stocks representing a sector of the S&P
500) returned 3.7% for the 1-year period ending October 31, 2007,
underperforming the S&P 500's return by 10.18%. However, past performance is not
an indicator of future results. We trimmed the Financial Services weighting to
roughly 21% of the portfolio. We remain more comfortable with our current level
of Financial Services exposure given the turmoil in the capital markets and are
encouraged with the investments we made in other segments of the portfolio.
MARKET OUTLOOK: SLOWING GROWTH
Currently, we believe that 2008 earnings growth and visibility are declining.
Earnings growth for a number of sectors will slow or turn negative as the
economy slows and the negative effects of the housing downturn and the credit
contraction take hold. From our perspective, this change in trend indicates an
inflection point which investors seem slow to recognize.
The Funds have increased their weightings in the Health Care and Technology
sectors, and we continue to believe these two sectors remain attractive. The
demand characteristics within the Health Care sector provide fertile investment
potential, even though we are sensitive to health care reimbursement risk as we
approach the 2008 elections. Technology is also an attractive sector despite
recent cautionary comments on enterprise spending. We believe that as the
economy slows, corporations will continue to spend on technology to drive
productivity.
HOLDINGS BASED STYLE CONFIRMATION
EARNINGS GROWTH AT REASONABLE VALUATIONS
CENTURY CENTURY SMALL RUSSELL 2000
SHARES TRUST S&P 500 CAP SELECT GROWTH
GROWTH CHARACTERISTICS - HISTORICAL ('02-'07) 9/30/07 9/30/07 10/31/07 10/31/07
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Return-on-Equity 5 years 21.8% 18.1% 16.3% 11.8%
Book Value Growth 5 years 15.6% 9.2% 18.4% 12.1%
Earnings/Share Growth 5 years 24.2% 16.0% 26.1% 20.9%
VALUATION CHARACTERISTICS
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Price/Earnings Ratio 1 Year Forecast 15.2 15.6 19.2 21.0
Price/Book Ratio 2.8 2.8 3.1 3.9
Source: Mellon Investment Solutions, Baseline
Please refer to definition of terms on the inside of front cover.
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CENTURY FUNDS 5
Our concerns regarding the Consumer and Financial Services sectors continue. We
believe the consumer's income statement and balance sheet are stressed. Many
home owners are experiencing an increase in mortgage payments, higher
inflationary pressures in commodity prices and cost-of-living increases.
With respect to Financial Services, we believe poor credit underwriting
(resulting from the lending bubble) will persist for the next few quarters,
leading to higher credit losses going forward.
CBOE's S&P 500 Volatility Index (VIX) --
2002 to 2007
(Above 25 = Fear, Below 15 = Optimism)
Line Chart:
02 22.71
21.34
20.45
21.94
21.83
22.13
22.36
22.6
23.58
22.7
23.45
22.25
22.52
23.61
21.88
21.15
21.01
21.14
24.35
23.22
21.09
21.12
24.87
25.45
26.09
25.11
23.26
21.78
21.62
20.85
21.77
22.37
24.43
22.66
23.8
22.86
21.84
21.68
21.49
21.59
19.96
20.5
20.3
19.94
20.04
19.27
19.84
19.59
19.46
19.2
18.42
18.93
18.16
18.46
18.15
17.77
18.48
18.13
17.7
17.4
18.73
19.16
20.2
19.78
19.13
19.61
19.47
18.19
20.3
19.42
19.82
18.11
18.43
19.29
18.3
19.77
20.28
20.77
20.95
22.14
24.05
21.91
20.06
20.07
20.19
22.56
21.94
20.39
21.56
22.41
20.72
19.35
19.19
18.5
17.7
19.24
20.05
19.58
18.23
18.9
20.31
20.39
20.61
19.98
23.37
23.89
22.61
24.16
23.51
23.72
24.45
24.15
25.02
25.96
24.64
24.24
26.06
27.48
27.23
26.98
27.84
28.42
26.29
25.4
27.11
28.96
29.42
27.11
28.25
30.22
34.1
33.85
32.94
35.03
36.65
35.45
35.12
38.17
41.87
44.92
39.86
39.27
35.51
31.33
31.92
32.03
36.95
41.29
45.08
42.03
38.73
36.33
35.33
37.05
35.82
32.36
29.43
28.81
28.61
29.59
28.23
27.75
29.32
29.89
30.11
33.32
33.67
32.64
39.97
37.44
38.86
36.33
36.45
35.08
34.81
37.5
35.82
36.74
38.01
37.52
40.65
38.98
39.68
40.52
37.33
34.6
36.97
39.69
34.12
36.83
37.31
39.46
42.64
41.02
42.13
37.55
35.7
36.04
34.02
36
34.1
33.53
33.11
34.09
33.2
34.03
30
31.07
32.27
31.23
31.14
29.3
30.82
31.23
30.73
31.42
29.41
31.3
30.58
31.24
28.67
26.65
27.66
27.41
25.32
23.81
23.16
24.07
25.97
27.25
27.5
27.46
28.33
28.92
30.1
28.88
30.78
28.76
27.76
27.29
28.18
26.24
26.66
28.29
30.21
26.71
26.2
26.49
27.37
29.55
29.62
28.62
03 25.39
24.68
24.91
25.13
25.53
24.25
24.32
24.9
24.57
25.51
25.01
25.7
27.59
29.01
27.53
31.51
34.69
31.93
31.26
31.32
31.17
31.02
32.76
33.04
33.35
34.01
33.99
33.68
34.33
33.7
32.62
31.11
31.31
31.16
30.25
31.98
31.74
31.94
30.53
29.63
30.43
31.83
30.38
31.37
31.08
33.31
33.61
33.51
31.76
30.98
31.75
30.43
31.54
30.44
28.67
30.39
28.75
28.23
27.96
27.75
29.15
28.36
28.02
28.21
29.13
28.45
27.13
27.11
25.6
24.44
23.41
22.56
22.52
21.5
21.95
20.7
20.8
20.33
20.8
20.84
20.76
21.21
21.59
20.63
21.13
20.8
21
21.24
19.69
19.52
19.91
20
19.24
18.4
20.51
21.29
21.21
19.78
19.17
19.99
20.03
20.43
19.47
20.85
20.84
20.62
20.83
21.25
22.15
20.64
20.21
20.41
20.66
20.22
20.01
19.76
19.8
19.14
20.58
20.75
20.81
19.4
19.16
19.52
19.46
19.03
19.39
20.06
19.48
18.93
19.19
18.47
19.59
19.55
19.76
20.22
19.11
19.78
19.17
18.64
18.6
17.75
18.36
18.67
18.85
19.49
20.75
21.27
22.68
21.5
20.26
19.59
19.75
17.94
18.77
18.47
18.27
18.18
17.86
17.82
17.84
18.55
19.53
19.49
19.13
18.48
18.63
19.02
19.44
18.71
18.17
18.26
18.85
20.01
19.25
18.68
19.28
18.03
18.15
17.57
17.54
19.65
19.47
21.22
22.26
22.23
21.67
22.72
21.07
20.8
19.5
19.51
19.41
19.18
18.82
18.45
17.55
17.37
17.69
17.19
17.62
17.04
16.55
17.67
17.68
17.71
18.05
16.82
16.43
16.33
16.1
16.55
16.55
16.86
16.74
16.93
17.62
17.54
16.75
16.47
16.94
18.6
19.11
18.8
19.48
18.98
17.44
16.71
16.23
16.32
16.77
16.27
16.63
16.3
17.09
16.54
17.63
17.87
16.73
16.41
17.23
15.93
15.58
16.16
16.42
16.94
16.49
16.66
17.45
17.09
17.68
18.31
04 18.22
17.49
16.73
15.5
15.61
16.75
16.82
18.04
16.75
15.56
15
15.21
14.34
14.71
14.84
14.55
15.35
16.78
17.14
16.63
17.11
17.34
17.87
17.71
16
16.39
15.94
15.39
15.31
15.58
15.4
15.59
15.8
16.04
16.29
15.9
14.93
14.83
14.55
14.44
14.86
14.55
14.4
14.48
15.79
16.6
18.67
20.67
18.3
21.13
20.34
18.11
18.53
19.15
21.58
20.67
19.81
17.88
17.33
16.5
16.28
16.74
16.65
15.64
14.97
15.32
15.76
16.26
15.28
17.26
15.62
15.74
14.94
15.42
16.67
15.6
14.61
14.01
14.77
15.07
16.29
16.6
17.19
16.62
16.55
15.77
17.05
18.13
19.77
18.57
18.14
18.86
18.47
19.96
19.33
18.93
18.67
18.49
18.08
15.96
15.97
15.28
15.5
16.3
16.08
17.03
16.78
15.39
15.01
15.39
15.04
16.07
15.05
14.79
15.15
14.99
15.26
14.31
13.98
14.81
15.19
16.07
15.47
14.34
15.2
15.08
16.25
15.81
16.2
15.78
14.96
14.46
13.76
14.71
14.34
15.17
14.17
16.41
15.75
16.5
17.3
16.55
16.15
15.68
15.32
15.37
16.03
16.21
18.32
19.34
18.89
17.47
18.04
19.08
17.98
17.57
17.02
16.23
16.96
16
15.88
15.33
14.98
14.91
14.71
15.44
15.29
14.91
14.28
13.91
14.07
14.06
14.01
13.76
13.17
13.56
14.64
14.39
14.03
14.43
13.66
14.74
14.8
14.28
14.62
13.83
13.21
13.34
12.75
13.41
13.95
13.28
14.5
15.05
14.71
15.05
15.42
16.43
15.04
14.71
15.13
14.85
14.54
15.28
16.58
16.39
15.72
15.39
16.27
16.27
16.18
14.04
13.97
13.84
13.8
13.61
13.08
13.04
13.33
13.38
13.21
13.21
12.98
13.5
12.97
12.67
12.72
12.78
13.3
13.24
12.97
12.98
12.96
13.19
13.67
13.19
12.88
12.76
12.54
12.73
12.35
12.27
11.95
11.83
11.55
11.45
11.23
12.14
12
11.62
12.56
13.29
05 14.08
13.98
14.09
13.58
13.49
13.23
13.19
12.56
12.84
12.43
12.47
13.18
13.83
14.36
14.65
14.06
13.44
13.24
13.24
12.82
12.03
11.66
11.79
11.21
11.73
11.6
12
11.51
11.43
11.52
11.27
11.1
11.77
11.18
13.14
12.39
11.57
11.49
12.08
12.04
12.5
12.93
11.94
12.26
12.4
12.7
12.49
12.8
12.39
13.15
13.49
13.29
13.14
13.61
14.27
14.06
13.42
13.75
14.49
13.64
14.02
14.09
14.11
13.68
13.15
12.33
12.62
11.98
11.3
13.31
14.53
17.74
16.56
14.96
16.92
14.41
15.38
14.62
14.91
14.87
16.86
15.31
15.12
14.53
13.85
13.98
14.05
13.75
14.91
14.45
16.12
16.32
15.68
14.57
13.63
13.32
13.14
12.95
12.69
12.58
12.24
12.15
13.29
12.36
11.84
12.15
12.28
12.39
12.7
12.08
11.96
11.65
11.79
11.46
11.15
11.48
11.47
11.08
11.05
12.13
12.18
12.52
11.58
11.77
12.04
11.4
11.68
12.27
12.49
11.45
11.28
10.95
10.84
10.81
10.33
10.77
10.45
10.23
10.97
10.52
11.1
10.99
10.36
10.52
11.57
12.08
11.75
11.83
12.52
12.48
13.21
12.4
12.38
12.42
12.74
12.26
13.52
13.3
13.42
13.42
13.42
13.34
14.17
13.73
13.72
13.52
13.65
12.6
13.15
13.57
12.93
12.52
12.93
11.98
11.65
12.39
12.91
12.49
11.22
12.14
12.64
13.79
13.33
12.96
13.04
12.76
12.63
12.24
11.92
12.46
13.2
14.55
14.96
14.59
15.55
15.63
16.22
16.47
14.87
14.67
15.33
13.5
16.11
16.13
14.74
14.53
14.59
16.02
14.25
15.32
14.85
13.48
13
13.17
13.1
13.08
12.8
11.9
11.63
12.18
12.23
12.26
11.25
11.12
10.82
10.6
10.96
10.88
11.84
11.89
12.06
11.24
11.01
11.6
11.52
12.18
12.21
11.69
11.47
11.11
10.48
10.73
10.68
11.38
11.19
10.81
10.29
10.27
11.57
11.35
11.61
12.07
06 11.14
11.37
11.31
11
11.13
10.86
10.94
11.2
11.23
11.91
12.25
11.98
14.56
13.93
13.31
12.87
12.42
11.97
12.39
12.95
12.36
13.23
12.96
13.04
13.59
12.83
13.12
12.87
13.35
12.25
12.31
11.48
12.01
12.41
11.88
11.87
11.46
11.59
12.34
11.54
11.72
11.96
12.74
12.66
12.32
12.68
11.85
11.37
10.74
11.35
11.98
12.12
11.79
11.62
11.21
11.17
11.19
11.46
11.58
10.95
11.57
11.39
11.57
11.14
11.13
11.45
12.26
12.19
13
12.76
12.38
12.58
11.4
11.32
11.64
11.59
11.75
11.75
11.76
11.84
11.59
12.54
11.99
11.99
11.86
11.62
12
11.99
11.78
12.49
14.19
13.57
13.35
16.26
16.99
17.18
17.72
18.26
17.36
15.5
14.26
18.66
16.44
14.52
14.32
16.65
17.34
17.8
18.35
18.12
20.96
23.81
21.46
15.9
17.25
17.83
16.69
15.52
15.88
15.89
15.62
16.4
15.79
13.03
13.08
13.05
14.15
13.65
13.97
14.02
13.14
14.49
17.79
18.05
18.64
17.74
15.55
16.21
17.4
14.98
14.85
14.62
14.94
14.33
14.95
15.05
14.34
14.46
14.34
15.23
15.23
15.2
14.46
14.3
14.26
13.42
12.41
12.24
11.64
12.22
12.19
12.4
12.4
12.31
12.18
12.28
12.22
12.31
11.96
12.63
13.74
13.88
13.16
12.99
11.92
11.18
11.55
11.76
11.78
11.98
11.39
12.25
12.59
12.12
11.53
11.58
11.72
11.98
12.57
12.24
11.86
11.98
11.56
11.68
11.52
11.62
11.09
10.75
11.09
11.73
11.34
10.9
10.63
11.08
10.78
10.66
10.56
10.8
11.2
11.1
11.51
11.42
11.16
11.16
11.09
10.75
11.01
10.79
10.86
10.5
10.31
10.16
10.05
9.97
9.9
10.14
10.73
12.3
11.62
10.83
10.91
11.66
11.23
11.27
11.33
12.67
12.07
10.71
10.65
10.18
9.97
10.05
10.6
10.3
10.26
10.53
11.36
11.26
10.64
10.99
11.56
07 12.04
11.51
12.14
12
11.91
11.47
10.87
10.15
10.74
10.59
10.85
10.4
10.77
10.34
9.89
11.22
11.13
11.45
10.96
10.42
10.31
10.08
10.55
10.65
10.32
10.44
11.1
11.61
10.34
10.23
10.22
10.02
10.24
10.2
10.18
10.58
11.15
18.31
15.42
15.82
18.61
19.63
15.96
15.24
14.29
14.09
13.99
18.13
17.27
16.43
16.79
14.59
13.27
12.19
12.93
12.95
13.16
13.48
14.98
15.14
14.64
14.53
13.46
13.24
13.23
13.14
12.68
13.49
12.71
12.2
11.98
12.14
12.42
12.54
12.07
13.04
13.12
13.21
12.79
12.45
14.22
13.51
13.08
13.09
12.91
13.15
13.21
12.88
13.6
12.95
13.96
14.01
13.5
13.51
12.76
13.3
13.06
13.24
14.08
13.34
13.53
12.83
13.05
12.78
13.29
13.63
14.87
17.06
14.84
14.71
16.67
14.73
13.64
13.94
13.42
12.85
14.67
14.21
15.75
16.65
18.89
15.53
15.54
16.23
15.4
14.92
15.48
14.72
15.16
17.57
16.64
15.54
15.15
15.59
15.63
16
15.23
16.95
16.81
18.55
18.1
20.74
24.17
20.87
23.52
23.67
21.22
25.16
22.94
21.56
21.45
26.48
28.3
26.57
27.68
30.67
30.83
29.99
26.33
25.25
22.89
22.62
20.72
22.72
26.3
23.81
25.06
23.38
22.78
24.58
23.99
26.23
27.38
25.27
24.96
24.76
24.92
26.48
20.35
20.03
20.45
19
19.37
18.6
17.63
17
18
17.84
18.49
18.8
18.44
16.91
17.46
16.12
16.67
18.88
17.73
19.25
20.02
18.54
18.5
22.96
21.64
20.41
20.8
21.17
19.56
19.87
21.07
18.53
23.21
23.01
24.31
21.39
26.49
26.16
28.5
31.09
24.1
25.94
28.06
25.49
26.01
24.88
26.84
25.61
28.91
26.28
24.11
11/28/07 = 24.11
It is also worth noting the activity in the Chicago Board Options Exchange's
(CBOE) Volatility Index (VIX) that measures the level of optimism or pessimism
in the stock market. Many investors refer to it as the "fear index" because a
high VIX (above 25) represents uncertainty in the markets. From 1997 through
2002, the VIX indicated investor "fear" in the markets, followed by four years
of optimism. The recent rise in the VIX suggests investor sentiment is shifting
again toward doubt or "fear." We believe this shift may cause investors to focus
more on quality investing in predictable businesses, which could benefit the
Century Funds' performance.
In summary, we believe that financial indigestion and consumer anxiety will
probably continue to weigh on the equity markets through midyear 2008. However,
we are very optimistic in the long term benefits of global growth, as well as
the export potential of many of our portfolio holdings. When markets get
nervous, we seek to take advantage of such opportunities to trade up in quality
and 'buy innovative leaders at laggard valuations.' The current environment
reminds us of a similar period in 1999-2001, and we get excited by irrational
market turbulence steering our research into new areas.
CENTURY'S INVESTMENT PROCESS
Our investment process emphasizes in-depth original research on each company,
its rivals and the industry in which it competes. In our screening process, we
develop a watch list by considering industry trends, company fundamentals and
valuation criteria. From this watch list, our research analysts begin a due
diligence process that includes both qualitative (i.e. visiting corporate and
satellite offices, interviewing contacts in the field) and quantitative (i.e.
building earnings models and relative valuation comparisons) methodologies. This
preparation leads to an understanding of the risk/reward profile for each stock,
in addition to the shifting trends in strategy, pricing, margins and market
share affecting each company.
Once we have conducted a stress test to challenge our assumptions, our analysts
prepare a recommendation to buy or sell a particular stock and present it to the
investment team. If there is a resulting purchase decision, we determine the
appropriate entry price and targeted exit price at which we will sell. One of
the most important steps is our sell discipline. As a stock approaches our
target price, we typically trim it. We continuously reassess our portfolio
holdings, factoring in changing conditions for each company.
Our goal is to enhance shareholder returns and avoid the common errors of
complacency that impact many investors (see the Mark Twain quote at the
beginning of this report.) How can we think or work differently than the
investor consensus? We hope to mitigate the risk of a higher-growth stock by
buying it when the market appears to be unaware of its accelerating growth
prospects. Our investment philosophy seeks to identify superior management teams
with sustainable competitive advantages in their products, services and
distribution networks. Evaluating management skill and ability is both art and
science. The art of asking the right questions and listening to the actual
answers (both what is said and not said), while observing the body language. The
science is in analyzing the competitive landscape, the company's results and the
likelihood that expectations will be exceeded or are overly optimistic.
SUMMARY
As winter begins to set in, this is a time to reflect on the weather outside.
The $14 trillion U.S. economy represents 25% of global gross domestic product
(GDP) and remains the most diverse and dynamic industrial force today. Asia's
rapid development continues to fuel changes in supply and demand for goods and
services around the world. Shifting market share and rapid innovation will
likely create great investment opportunities over the next couple years.
Meanwhile, recent subprime credit and consumer concerns, alongside inflationary
pressures, will be a challenging headwind over the next year, and we anticipate
a continued economic slowdown ahead of the 2008 presidential election.
Geopolitical uncertainty (Middle East, Africa, Russia, and Venezuela) will
ensure that energy and commodity prices are likely to remain high for the
foreseeable future.
6 CENTURY FUNDS
The current conditions remind us of the events leading up to the 2000 election.
On balance, this uncertain landscape will make for a long and rhetoric-filled
political campaign, and market volatility is likely to remain high as these
'animal spirits' influence stock prices over the next year.
From our perspective, we are excited by the resulting opportunities we see for
our 'quality growth' franchises in these nervous times. As the concept of 'risk'
claws back into investors' psyche, we foresee a higher appreciation for 'quality
growth' companies that have underperformed recently.
This is a very interesting time to be a research-intensive investor. Our
investment team is also focusing on some long term thematic trends that may lead
to new portfolio positions and further commentary in the future, including
energy infrastructure and conservation, consumer-driven health care and the
fragmentation of media in our culture.
Thank you for your ongoing support of Century, and we hope to earn your
confidence again in the coming year.
We wish you and your family a Happy New Year from all of us at Century Funds.
Please visit our website (www.centuryfunds.com) for updates on the Funds, and we
always welcome your questions and comments by phone or mail.
Sincerely,
/s/ Alexander L. Thorndike /s/ Kevin W. Callahan, CFA
Alexander L. Thorndike Kevin W. Callahan, CFA
Chief Investment Officer Co-Portfolio Manager
and Portfolio Manager
This report reflects our views, opinions and portfolio holdings as of October
31, 2007, the end of the reporting period. Any such views are subject to change
at any time based upon market or other conditions and Century Capital disclaims
any responsibility to update these views. The views and opinions expressed in
this report may not be relied on as investment advice or an indication of
trading intent on behalf of either Fund.
CENTURY FUNDS 7
SHAREHOLDER EXPENSE EXAMPLE
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs
including redemption fees, and (2) ongoing costs, including management fees,
distribution and service fees (in the case of Investor Shares of both Funds) 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 those 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 (May 1, 2007 to October 31, 2007).
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 $1,000.00 (for example, an $8,600
account value divided by $1,000.00=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. An annual
maintenance fee of $10.00 that is charged once a year may apply for certain IRA
accounts. This fee is not included in the table below. If it was, the estimate
of expenses you paid during the period would be higher, and your ending account
value lower, by this amount.
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 transaction costs such as redemption
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.
CENTURY SHARES TRUST EXPENSES PAID
DURING PERIOD*
BEGINNING ENDING SIX MONTHS
ACCOUNT VALUE ACCOUNT VALUE ENDING
MAY 1, 2007 OCTOBER 31, 2007 OCTOBER 31, 2007
Based on Actual Fund Return
Institutional Shares $1,000.00 $1,050.40 $5.68
Investor Shares $1,000.00 $1,048.70 $8.11
Based on Hypothetical 5% Yearly Return before expenses
Institutional Shares $1,000.00 $1,019.66 $5.60
Investor Shares $1,000.00 $1,017.29 $7.98
* The Fund's annual expense ratios are 1.10% for Institutional Shares and
1.56% for Investor Shares. The dollar amounts shown as "Expenses Paid" are
equal to the annual expense ratio multiplied by the average account value
over the period, multiplied by the number of days in the most recent fiscal
half-year, then divided by 365.
CENTURY SMALL CAP SELECT FUND EXPENSES PAID
DURING PERIOD*
BEGINNING ENDING SIX MONTHS
ACCOUNT VALUE ACCOUNT VALUE ENDING
MAY 1, 2007 OCTOBER 31, 2007 OCTOBER 31, 2007
Based on Actual Fund Return
Institutional Shares $1,000.00 $1,027.90 $5.52
Investor Shares $1,000.00 $1,026.30 $6.95
Based on Hypothetical 5% Yearly Return before expenses
Institutional Shares $1,000.00 $1,019.76 $5.50
Investor Shares $1,000.00 $1,018.35 $6.92
* The Fund's annual expense ratios are 1.08% for Institutional Shares and
1.36% for Investor Shares. The dollar amounts shown as "Expenses Paid" are
equal to the annual expense ratio multiplied by the average account value
over the period, multiplied by the number of days in the most recent fiscal
half-year, then divided by 365.
8 CENTURY FUNDS
PERFORMANCE SUMMARY
The performance information shown below is historical and does not guarantee
future results. Performance figures assume the reinvestment of all dividend and
capital gain distributions, but do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund shares.
Please see the inside front cover of this report for additional related
disclosure.
PERFORMANCE OF A $10,000 INVESTMENT
The following charts compare the performance of a hypothetical $10,000
investment in Century Small Cap Select Fund's Institutional Shares and Investor
Shares to the Russell 2000 Growth Index and the Russell 2000 Index, from the
inception date of each share class through October 31, 2007. The Russell 2000
Growth Index is an unmanaged, capitalization-weighted index of the 2000 smallest
companies in the Russell 3000 Growth Index, which comprises the 3,000 largest
U.S. companies that exhibit growth-oriented characteristics. The Russell 2000
Index is an index of the 2,000 smallest companies in the Russell 3000 Index. On
February 28, 2007, the Russell 2000 Growth Index replaced the Russell 2000 Index
as the comparative index for the Fund. The Fund's adviser believes that the
Russell 2000 Growth Index is a more appropriate benchmark because the Fund
invests principally in companies that exhibit growth characteristics similar to
those of companies included in the Russell 2000 Growth Index. The Index returns
assume the reinvestment of dividends, but do not reflect deductions for fees and
expenses. It is not possible to invest directly in an index.
Line Chart:
Century Small Cap Select Fund
Institutional Shares*, Russell 2000G & Russell 2000(R)
Dec-99 10000 10000 10000
10100 11042 10696
Apr-00 11150 10950 10940
12390 10315 10840
Oct-00 14570 9954 10819
15304 9345 11091
Apr-01 14862 8227 10627
16024 7911 10654
Oct-01 15099 6819 9445
16337 7569 10691
Apr-02 17592 7528 11337
15767 5489 8741
Oct-02 15985 5348 8352
16309 5324 10691
Apr-03 17376 5759 11337
20482 7025 10761
Oct-03 22980 7838 11974
25588 8557 13200
Apr-04 24419 8152 12757
24026 7820 12596
Oct-04 25239 8271 13378
26557 8874 14344
Apr-05 26661 8107 13358
29240 9586 15718
Oct-05 27812 9174 14994
30170 10612 17054
Apr-06 30835 11037 17829
28511 9733 16385
Oct-06 30064 10739 17990
31641 11174 18835
Apr-07 32642 11537 19225
31653 11371 18371
Oct-07 33588 12536 19658
Line Chart:
Century Small Cap Select Fund
Investor Shares**, Russell 2000G & Russell 2000(R)
Feb-00 10000 10000 10000
Apr-00 10920 8425 9154
12130 7937 9071
Oct-00 14260 7659 9053
14978 9280 9280
Apr-01 14593 8892 8892
15727 8915 8915
Oct-01 14785 7903 7903
15990 8946 8946
Apr-02 17208 9486 9486
15412 7314 7314
Oct-02 15574 6989 6989
15871 4097 6990
Apr-03 16902 4431 7517
19883 5405 9004
Oct-03 22290 6031 10019
24792 6584 11045
Apr-04 23652 6273 10675
23246 6017 10540
Oct-04 24397 6364 11195
25648 6828 12003
Apr-05 25739 6238 11178
28211 7376 13152
Oct-05 26806 7058 12547
29089 8165 14270
Apr-06 29703 8492 14919
27438 7489 13711
Oct-06 28907 8263 15054
30406 8598 15761
Apr-07 31357 8877 16087
30381 8749 15372
Oct-07 32183 9645 16449
- ----------------------------------------------------------------------------------------------------------------
1 YEAR 3 YEARS 5 YEARS SINCE INCEPTION**
CENTURY SMALL CAP SELECT INVESTOR SHARES 11.34 9.67 15.62 16.43
RUSSELL 2000 GROWTH 16.73 14.87 18.57 -0.47
RUSSELL 2000 9.27 13.69 18.67 6.69
1 YEAR 3 YEARS 5 YEARS SINCE INCEPTION*
CENTURY SMALL CAP SELECT INSTITUTIONAL SHARES 11.61 9.99 16.01 16.59
RUSSELL 2000 GROWTH 16.73 14.87 18.57 2.90
RUSSELL 2000 9.27 13.69 18.67 8.94
- ----------------------------------------------------------------------------------------------------------------
* INCEPTION DATE 12/9/99
** INCEPTION DATE 2/24/00
TEN LARGEST HOLDINGS
World Fuel Service Corp. 3.24%
Healthways, Inc. 2.97%
Blackbaud, Inc. 2.77%
Bruker Biosciences Corp. 2.55%
Techne Corp. 2.49%
Perrigo Co. 2.29%
SurModics, Inc. 2.21%
Quality Systems, Inc. 2.20%
Primus Guaranty Ltd 2.20%
Andersons, Inc. 2.16%
Pie Chart:
Century Small Cap Select Fund
Fund Composition 10/31/07*
*Based on the Fund's net assets at 10/31/07
Health Care, 26.4%
Consumer Discretionary, 21.9%
Financial Services, 18.2%
Technology, 15.3%
Materials & Processing, 5.3%
Producer Durables, 5.3%
Other Energy, 4.4%
Cash, 3.2%
CENTURY FUNDS 9
PERFORMANCE OF A $10,000 INVESTMENT
The following charts compare the performance through October 31, 2007 of a
hypothetical $10,000 investment in Century Shares Trust's Institutional Shares
over the last ten years and the Trust's Investor Shares (7/18/05 inception date)
and the S&P 500(R) Index. The S&P 500 Index is a well known gauge of how large
capitalization U.S.equities are doing. On the other hand, its results are not
adjusted for the costs to manage and trade a portfolio of securities, so they
are not directly comparable to an actual investor's results, and it is not
available for investment. This differs from the Trust's focus on investments in
the financial services and related business services sectors.
Century Shares Trust
Institutional Shares and S&P 500(R) Index
Line Chart:
10/31/97 10000 10000
10/31/98 11243 12199
10/31/99 10979 15331
10/31/00 13754 16264
10/31/01 13291 12214
10/31/02 12531 10369
10/31/03 14660 12526
10/31/04 15987 13706
10/31/05 17774 14901
10/31/06 19582 17336
10/31/07 21905 19860
Century Shares Trust
Investors Shares and S&P 500(R) Index
Line Chart:
7/18/05 10000 10000
10011 10113
9871 10020
9997 10102
10/31/05 10100 9933
10484 10309
10435 10312
1/31/06 10432 10585
10488 10614
10543 10746
4/30/06 10630 10891
10323 10577
10330 10591
7/31/06 10389 10657
10666 10910
10878 11192
10/31/06 11027 11556
11154 11776
11375 11941
1/31/07 11445 12122
11262 11885
11316 12018
4/30/07 11712 12550
12098 12988
11924 12772
7/31/07 11578 12376
11819 12562
12174 13031
10/31/07 12282 13239
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. The performance graph and
returns table do not reflect the deduction of taxes that a shareholder would pay
on Trust distributions or the redemption of Trust shares.
CST risk disclosure is located on inside cover
1YR 3 YEARS 5 YEARS 10 YEARS
CST INSTITUTIONAL SHARES 11.86 11.07 11.82 8.16
S&P 500 14.56 13.13 13.87 7.10
SINCE
1 YEAR INCEPTION
CST INVESTOR SHARES 11.38 9.41
S&P 500 14.56 13.05
INCEPTION DATE 7/18/05
PIE CHART:
TEN LARGEST HOLDINGS
American International Group, Inc. 3.23%
United Health Group, Inc. 3.19%
Cisco Systems, Inc. 3.13%
Microsoft Corp. 3.07%
Berkshire Hathaway, Inc. - A 2.89%
Chubb Corp. 2.80%
Procter and Gamble Co. 2.50%
United Technologies Corp. 2.48%
3M Co. 2.44%
Oracle Corp. 2.33%
Century Shares Trust
Fund Composition 10/31/07*
*Based on the Trust's net assets at 10/31/07
Health Care, 21.3%
Financial Services, 21.2%
Technology, 14.5%
Consumer Discretionary, 11.7%
Producer Durables, 8.1%
Consumer Staples, 6.4%
Other, 5.4%
Cash, 4.7%
Auto & Transport, 3.7%
Other Energy, 3.0%
10 CENTURY FUNDS
CENTURY SMALL CAP SELECT FUND
PORTFOLIO OF INVESTMENTS - OCOTBER 31, 2007
COMMON STOCK - 96.8%
SHARES VALUE
- ----------------------------------------------------------------
CONSUMER DISCRETIONARY - 21.9%
231,550 Advisory Board Co. * $ 14,867,826
336,350 Bright Horizons Family
Solutions, Inc. * 13,050,380
540,950 Casual Male Retail Group, Inc. * 4,522,342
180,850 CBIZ, Inc. * 1,627,650
4,029,050 CMGI, Inc. * 5,680,961
244,300 Coinstar, Inc. * 8,416,135
141,700 Corinthian Colleges, Inc. * 2,322,463
167,000 Cornell Companies, Inc. * 4,154,960
180,700 CRA International, Inc. * 9,356,646
116,200 DTS, Inc. * 3,303,566
429,350 Forrester Research, Inc. * 10,184,182
137,950 Houston Wire & Cable Co. 2,423,782
304,725 Jarden Corp. * 10,823,832
95,400 John Wiley & Sons, Inc. 4,195,692
506,750 Red Lion Hotels Corp. * 4,976,285
426,550 Scientific Games Corp. * 15,419,783
258,920 Tractor Supply Co. * 10,729,645
329,800 United Natural Foods, Inc. * 9,544,412
380,602 USANA Health Sciences, Inc. * 15,532,368
148,750 ValueClick, Inc. * 4,044,513
609,800 World Fuel Services Corp. 27,008,042
-------------
182,185,462
-------------
FINANCIAL SERVICES - 18.2%
123,690 Cohen & Steers, Inc. 4,650,744
360,771 CyberSource Corp. * 5,898,606
775,300 Employers Holdings, Inc. 14,854,748
147,400 Euronet Worldwide, Inc. * 4,721,222
112,900 Fair Isaac Corp. 4,281,168
355,500 GATX Corp. 14,564,835
273,250 McGrath Rentcorp. 9,367,010
119,350 National Financial Partners Corp. 6,524,865
949,750 Online Resources Corp. * 8,785,188
423,600 optionsXpress Holdings, Inc. 12,606,336
431,440 Platinum Underwriters
Holdings, Ltd. 15,531,840
1,999,810 Primus Guaranty Ltd. * 18,318,260
378,150 Signature Bank * 12,913,823
164,150 Waddell & Reed Financial, Inc. 5,453,063
342,150 Wright Express Corp. * 13,241,205
-------------
151,712,911
-------------
HEALTH CARE - 26.4%
156,950 American Dental Partners, Inc. * 3,890,791
612,500 BioScrip, Inc. * 4,795,875
2,050,050 Bruker BioSciences Corp. * 21,218,018
146,562 Computer Programs & Systems, Inc. 3,630,341
280,700 Emeritus Corp. * 9,263,100
SHARES VALUE
- ----------------------------------------------------------------
HEALTH CARE (CONTINUED)
52,150 FGX International Holdings Ltd. * $ 891,765
117,246 Haemonetics Corp. * 6,025,272
505,750 Healthextras, Inc. * 14,737,555
407,519 Healthways, Inc. * 24,736,403
203,100 Kendle International, Inc. * 8,191,023
87,150 Millipore Corp. * 6,767,198
803,250 Perrigo Co. 19,045,058
429,100 Psychiatric Solutions, Inc. * 16,992,360
244,850 QIAGEN N.V. * 5,763,769
505,962 Quality Systems, Inc. 18,331,003
151,800 The Spectranetics Corp. * 2,428,800
324,451 Surmodics, Inc. * 18,409,350
317,350 TECHNE Corp. * 20,703,914
345,050 West Pharmaceutical Services, Inc. 14,264,367
-------------
220,085,960
-------------
MATERIALS AND PROCESSING - 5.3%
362,669 Andersons, Inc. 18,006,516
78,800 Kaydon Corp. 4,238,652
251,650 Rogers Corp. * 12,338,400
457,430 RPM International, Inc. 9,802,725
-------------
44,386,292
-------------
OTHER ENERGY - 4.4%
296,150 Alon USA Energy, Inc. 10,889,436
218,650 Berry Petroleum Co. 10,652,628
355,750 Foundation Coal Holdings, Inc. 15,197,640
-------------
36,739,704
-------------
PRODUCER DURABLES - 5.3%
389,100 Darling International, Inc. * 3,914,346
205,300 Donaldson Co., Inc. 8,799,158
356,350 Measurement Specialties, Inc. * 9,885,149
192,950 MTS Systems Corp. 8,584,346
148,350 Polycom, Inc. * 4,150,833
693,817 Semitool, Inc. * 6,438,622
113,800 Taser International, Inc. * 1,894,770
-------------
43,667,223
-------------
TECHNOLOGY - 15.3%
570,855 Benchmark Electronics, Inc. * 11,708,236
856,203 Blackbaud, Inc. 23,074,671
105,418 Cognos, Inc. * 5,305,688
211,850 DRS Technologies, Inc. 12,168,664
1,105,060 Epicor Software Corp. * 12,907,101
1,188,450 Lawson Software, Inc. * 13,417,601
269,950 Macrovision Corp. * 6,478,800
176,200 MICROS Systems, Inc. * 12,654,684
CENTURY FUNDS 11
SHARES VALUE
- ----------------------------------------------------------------
TECHNOLOGY (CONTINUED)
398,400 SI International, Inc. * $ 11,238,864
646,700 SMART Modular
Technologies, Inc. * 5,716,828
193,500 II-VI, Inc. * 6,722,190
321,450 Websense, Inc. * 5,914,680
-------------
127,308,006
-------------
TOTAL INVESTMENT IN COMMON STOCKS - 96.8%
(Identified cost, $739,757,161) 806,085,558
-------------
FACE AMOUNT VALUE
- ----------------------------------------------------------------
CASH EQUIVALENTS - 2.7%
$22,571,000 State Street Bank and Trust
Eurodollar Time Deposit, at
cost approximting value,
maturity 11/01/07, 3.55% $ 22,571,000
-------------
TOTAL INVESTMENTS - 99.5%
(Identified cost, $762,328,161) 828,656,558
-------------
CASH AND RECEIVABLES LESS LIABILITIES - 0.5%
Other Assets in Excess of Liabilities 4,119,790
-------------
Net Assets - 100% $ 832,776,348
=============
*Non-income producing security
See notes to financial statements.
12 CENTURY FUNDS
CENTURY SHARES TRUST
PORTFOLIO OF INVESTMENTS - OCTOBER 31, 2007
COMMON STOCK - 95.3%
SHARES VALUE
- ----------------------------------------------------------------
AUTO & TRANSPORT - 3.7%
48,500 FedEx Corp. $ 5,011,990
107,450 Oshkosh Truck Corp. 5,823,790
-------------
10,835,780
-------------
CONSUMER DISCRETIONARY - 11.7%
72,900 Accenture, Ltd. 2,846,745
64,350 Bed Bath & Beyond, Inc. * 2,184,039
36,000 Costco Wholesale Corp. 2,421,360
93,450 Fastenal Co. 4,156,656
69,450 Home Depot, Inc. 2,188,370
122,450 McGraw-Hill Companies, Inc. 6,127,398
26,150 Nordstrom, Inc. 1,031,356
153,900 Scientific Games Corp. * 5,563,485
244,415 Staples, Inc. 5,704,646
26,410 Tiffany & Co. 1,430,894
-------------
33,654,948
-------------
CONSUMER STAPLES - 6.4%
79,300 PepsiCo, Inc. 5,845,996
103,900 Proctor & Gamble Co. 7,223,128
136,670 Walgreen Co. 5,418,966
-------------
18,488,090
-------------
FINANCIAL SERVICES - 21.2%
73,100 AFLAC, Inc. 4,589,218
147,866 American International Gr., Inc. 9,333,302
105,000 Aon Corp. 4,758,600
63 Berkshire Hathaway, Inc. CL A * 8,347,500
151,600 The Chubb Corp. 8,087,860
123,000 J.P. Morgan Chase & Co. 5,781,000
69,350 Paychex, Inc. 2,897,443
310,750 The Progressive Corp. 5,748,875
84,400 Protective Life Corp. 3,618,228
80,000 Torchmark Corp. 5,212,800
87,666 Waddell & Reed Fin'l, Inc. CL A 2,912,265
-------------
61,287,090
-------------
HEALTH CARE - 21.3%
15,000 Alcon, Inc. 2,283,150
106,300 Barr Pharmaceuticals, Inc. * 6,093,116
45,400 C.R. Bard, Inc. 3,795,894
58,836 CVS/Caremark Corp. 2,457,580
65,900 Cardinal Health, Inc. 4,483,177
74,250 Covance, Inc. * 6,125,625
73,450 Johnson & Johnson, Inc. 4,786,737
71,800 Millipore Corp. * 5,575,270
SHARES VALUE
- ----------------------------------------------------------------
HEALTH CARE (CONTINUED)
57,550 Roche Holdings Ltd. ADR $ 4,911,893
118,400 Schering Plough Corp. 3,613,568
42,700 Techne Corp. * 2,785,748
187,481 UnitedHealth Group, Inc. 9,214,691
29,740 Wellpoint, Inc. * 2,356,300
41,600 Zimmer Holdings, Inc. * 2,890,784
-------------
61,373,532
-------------
MATERIALS & PROCESSING - 0.8%
74,200 Quanta Services, Inc. * 2,448,600
-------------
OTHER - 3.5%
35,550 Fortune Brands, Inc. 2,978,024
81,650 3M Co. 7,051,294
-------------
10,029,318
-------------
OTHER ENERGY - 3.0%
101,500 Peabody Energy Corp. 5,658,625
41,350 Valero Energy Corp. 2,912,281
-------------
8,570,906
-------------
PRODUCER DURABLES - 8.1%
60,400 Danaher Corp. 5,174,468
155,950 Donaldson Co., Inc. 6,684,017
20,050 General Cable Corp. * 1,443,400
80,750 IDEX Corp. 2,860,165
93,610 United Technologies Corp. 7,169,590
-------------
23,331,639
-------------
TECHNOLOGY - 14.5%
39,150 Amdocs Ltd. * 1,346,760
273,700 Cisco Systems, Inc. * 9,048,522
130,950 Cognos, Inc. * 6,590,714
240,540 Microsoft Corp. 8,854,277
198,150 Motorola, Inc. 3,723,239
39,700 Nokia Corp. ADR 1,576,884
303,350 Oracle Corp. * 6,725,270
118,650 Texas Instruments, Inc. 3,867,990
-------------
41,733,655
-------------
UTILITIES - 1.1%
156,500 Comcast Corp. * 3,294,325
-------------
TOTAL INVESTMENT IN COMMON STOCKS - 95.3%
(Identified cost, $182,625,723) 275,047,883
-------------
See notes to financial statements.
CENTURY FUNDS 13
FACE AMOUNT VALUE
- ----------------------------------------------------------------
CASH EQUIVALENTS - 5.2%
$15,152,000 State Street Bank and Trust
Eurodollar Time Deposit, at
cost approximating value,
maturity 11/01/07, 3.55% $ 15,152,000
-------------
Total Investments - 100.5%
(Identified cost, $197,777,723) 290,199,883
-------------
Other Assets and Liabilities - (0.5)%
Other Liabilities in excess of assets (1,524,176)
-------------
Net Assets - 100% $ 288,675,707
=============
*Non-income producing security
See notes to financial statements.
14 CENTURY FUNDS
STATEMENT OF ASSETS AND LIABILITIES - OCTOBER 31, 2007
Century Shares Century Small Cap
Trust Select Fund
ASSETS:
Investments, at value (Note 1A) (Identified cost of, $197,777,723 and
$762,328,161, respectively) ................................................ $290,199,883 $828,656,558
Cash ........................................................................... 565 121
Dividends and interest receivable .............................................. 138,959 131,200
Receivable for investments sold ................................................ -- 22,491,597
Receivable for Trust/Fund shares sold .......................................... 18,982 611,516
Other assets ................................................................... 14,960 --
------------ ------------
Total Assets ............................................................... 290,373,349 851,890,992
------------ ------------
LIABILITIES:
Payable to Affiliates:
Management fee (Note 4) .................................................... 165,852 674,038
Administration fee (Note 5) ................................................ 76,339 --
Distribution fees (Note 7) ................................................. 1,246 30,894
Accrued expenses and other liabilities ......................................... 100,320 209,349
Payable for investments purchased .............................................. 1,114,060 17,314,129
Payable for Trust/Fund shares repurchased ...................................... 239,825 886,234
------------ ------------
Total Liabilities .......................................................... 1,697,642 19,114,644
------------ ------------
NET ASSETS ..................................................................... $288,675,707 $832,776,348
============ ============
At October 31, 2007, net assets consisted of:
Capital paid-in ................................................................ $133,830,504 $703,907,599
Accumulated undistributed net realized gains on investments .................... 62,423,043 62,540,352
Unrealized appreciation in value of investments ................................ 92,422,160 66,328,397
------------ ------------
Net assets applicable to outstanding capital stock ............................. $288,675,707 $832,776,348
============ ============
Net Assets consist of:
Institutional Class ........................................................ $287,669,739 $575,026,663
Investor Class ............................................................. $1,005,968 $257,749,685
Shares Outstanding consist of (Note 2):
Institutional Class ........................................................ 9,744,047 22,003,302
Investor Class ............................................................. 34,142 10,022,062
NET ASSET VALUE PER SHARE (Represents both the offering and redemption price*)
Institutional Class ........................................................ $29.52 $26.13
Investor Class ............................................................. $29.46 $25.72
* In general, shares of the Trust and Fund may be redeemed at net asset
value. However, upon the redemption of shares held less than 90 days, a
redemption fee of 1% of the current net asset value of the shares may be
assessed and retained by each for the benefit of their respective remaining
shareholders. The recemption fee is accounted for as an addition to
paid-in-capital.
See notes to financial statements.
CENTURY FUNDS 15
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 2007
Century Shares Century Small Cap
Trust Select Fund
Investment Income/(Loss):
Dividends (net of withholding tax of $32,522 and $0, respectively) $ 4,298,848 $ 7,504,247
Interest 563,658 2,160,538
------------ ------------
Total income 4,862,506 9,664,785
------------ ------------
Expenses:
Investment adviser fee (Note 4) 2,339,767 8,277,267
Non-interested trustees' remuneration 39,575 148,605
Transfer agent
Institutional Class 99,160 105,785
Investor Class 8,670 441,000
Custodian 56,875 120,800
Administration (Note 5) 438,706 61,880
Insurance 3,650 32,950
Professional fees 77,910 123,770
Registration 46,850 50,950
Printing and other 118,150 434,260
Distribution and service fee (Note 7) 3,377 500,201
------------ ------------
Total expenses 3,232,690 10,297,468
Advisor reimbursement (Note 6) (5,274) --
------------ ------------
Net expenses 3,227,416 10,297,468
------------ ------------
Net investment income/(loss) 1,635,090 (632,683)
------------ ------------
Realized and Unrealized Gain (Loss) on Investments:
Net realized gain from investment transactions 62,813,977 68,702,337
(Decrease)/increase in unrealized appreciation on investments (31,685,500) 27,688,064
------------ ------------
Net realized and unrealized gain on investments 31,128,477 96,390,401
------------ ------------
Net increase in net assets resulting from operations $ 32,763,567 $ 95,757,718
============ ============
See notes to financial statements.
16 CENTURY FUNDS
STATEMENT OF CHANGES IN NET ASSETS
Century Small Cap
Century Shares Trust Select Fund
INCREASE (DECREASE) Year Ended Year Ended Year Ended Year Ended
IN NET ASSETS: October 31, 2007 October 31, 2006 October 31, 2007 October 31, 2006
Operations:
Net investment income/(loss) $ 1,635,090 $ 879,585 $ (632,683) $ 1,408,894
Net realized gain on investment transactions 62,813,977 79,595,230 68,702,337 80,347,261
Change in net unrealized appreciation (31,685,500) (50,132,170) 27,688,064 (56,826)
------------ ------------ ------------ ------------
Net increase in net assets resulting
from operations 32,763,567 30,342,645 95,757,718 81,699,329
Distributions to shareholders from:
Net Investment Income
Institutional Class (4,517,444) (7,217,847) (4,411,492) (2,271,628)
Investor Class (2,257) (26,346) (7,516,448) (512,770)
Realized gain from investment transactions
Institutional Class (75,570,929) (21,454,737) (27,610,318) (6,886,193)
Investor Class (459,673) (78,306) (42,614,264) (4,754,069)
Trust/Fund share transactions - net (Note 2) 29,443,454 (19,338,500) (75,118,501) (165,917,361)
Redemption fees 3,271 7,107 10,896 150,395
------------ ------------ ------------ ------------
Total decrease (18,340,011) (17,765,984) (61,502,409) (98,492,297)
Net Assets:
At beginning of year 307,015,718 324,781,702 894,278,757 992,771,054
------------ ------------ ------------ ------------
At end of year $288,675,707 $307,015,718 $832,776,348 $894,278,757
============ ============ ============ ============
Distributions in excess of net investment
income at end of year $ -- $ 247,377 $ -- $ --
See notes to financial statements.
CENTURY FUNDS 17
FINANCIAL HIGHLIGHTS
CENTURY SHARES TRUST YEAR ENDED OCTOBER 31,
INSTITUTIONAL SHARES 2007 2006 2005 2004 2003
Net Asset Value, beginning of period $ 35.69 $ 35.40 $ 35.62 $ 35.66 $ 33.95
--------- --------- --------- --------- ---------
Income/(loss) from Investment Operations:
Net investment income (a) 0.16 0.10 0.19 0.03 0.07
Net realized and unrealized gain/(loss) on investments 2.95 3.31 3.54 3.02 5.03
--------- --------- --------- --------- ---------
Total income/(loss) from investment operations 3.11 3.41 3.73 3.05 5.10
--------- --------- --------- --------- ---------
Less Distributions From:
Net investment income (0.43) (0.77) (0.32) (0.34) (0.10)
Net realized gain on investment transactions (8.85) (2.35) (3.63) (2.75) (3.29)
--------- --------- --------- --------- ---------
Total distributions (9.28) (3.12) (3.95) (3.09) (3.39)
--------- --------- --------- --------- ---------
Redemption fees --+ --+ --+ --+ --+
--------- --------- --------- --------- ---------
Net Asset Value, end of period $ 29.52 $ 35.69 $ 35.40 $ 35.62 $ 35.66
========= ========= ========= ========= =========
Total Return 11.86% 10.17% 11.18% 9.06% 16.99%
Ratios and supplemental data
Net assets, end of period (000 omitted) $ 287,670 $ 305,172 $ 323,643 $ 362,392 $ 342,679
Ratio of expenses to average net assets 1.10% 1.11% 1.12% 1.15% 1.17%
Ratio of net investment income to average net assets 0.56% 0.29% 0.55% 0.07% 0.21%
Portfolio Turnover Rate 38% 48% 19% 43% 37%
YEAR
ENDED PERIOD ENDED
CENTURY SHARES TRUST OCTOBER 31, OCTOBER 31,
INVESTOR CLASS 2007 2006 2005 (B)
Net Asset Value, beginning of period $ 35.41 $ 35.35 $ 35.00
------- ------- -------
Income from Investment Operations:
Net investment (loss)/income (a) 0.01 (0.19) (0.03)
Net realized and unrealized gain on investments 2.96 3.27 0.29
------- ------- -------
Total income from investment operations 2.97 3.08 0.26
------- ------- -------
Less Distributions From:
Net investment income (0.07) (0.68) --
Net realized gain on investment transactions (8.85) (2.35) --
------- ------- -------
Total distributions (8.92) (3.03) --
------- ------- -------
Redemption fees --+ 0.01 0.09
------- ------- -------
Net Asset Value, end of period $ 29.46 $ 35.41 $ 35.35
======= ======= =======
Total Return 11.38% 9.18% 1.00%**
Ratios and supplemental data
Net assets, end of period (000 omitted) $ 1,006 $ 1,844 $ 1,139
Ratio of expenses to average net assets 1.56% 2.00% 1.20%*
Ratio of expenses to average net assets without
giving effect to voluntary expense agreement 1.95% 2.15% 1.35%*
Ratio of net investment (loss)/income to average net assets 0.05% -0.58% -0.36%*
Portfolio Turnover Rate 38% 48% 19%
(a) Calculated based on average shares outstanding during the period.
(b) From the commencement date of investment operations, July 18, 2005 to
October 31, 2005.
+ Amount represents less than $0.01 per share.
* Annualized
** Not annualized
See notes to financial statements.
18 CENTURY FUNDS
FINANCIAL HIGHLIGHTS (CONTINUED)
CENTURY SMALL CAP SELECT FUND YEAR ENDED OCTOBER 31,
INSTITUTIONAL SHARES 2007 2006 2005 2004 2003
Net Asset Value, beginning of period $ 25.74 $ 24.15 $ 22.46 $ 21.53 $ 15.42
--------- --------- --------- --------- ---------
Income from Investment Operations:
Net investment (loss)/income (a) -- 0.06 0.03 (0.08) (0.09)
Net realized and unrealized gain on investments 2.75 1.90 2.22 2.14 6.64
--------- --------- --------- --------- ---------
Total income from investment operations 2.75 1.96 2.25 2.06 6.55
--------- --------- --------- --------- ---------
Less Distributions From:
Net investment income (0.35) (0.09) -- (0.94) (0.11)
Net realized gain on investment transactions (2.01) (0.28) (0.56) (0.19) (0.35)
--------- --------- --------- --------- ---------
Total distributions (2.36) (0.37) (0.56) (1.13) (0.46)
--------- --------- --------- --------- ---------
Redemption fees --+ --+ --+ --+ 0.02
--------- --------- --------- --------- ---------
Net Asset Value, end of period $ 26.13 $ 25.74 $ 24.15 $ 22.46 $ 21.53
========= ========= ========= ========= =========
Total Return 11.61% 8.21% 10.19% 9.83% 43.76%
Ratios and supplemental data
Net assets, end of period (000 omitted) $ 575,027 $ 540,697 $ 585,723 $ 140,208 $ 42,936
Ratio of expenses to average net assets 1.08% 1.07% 1.06% 1.13% 1.26%
Ratio of expenses to average net assets without
giving effect to voluntary expense agreement 1.08% 1.07% 1.06% 1.13% 1.40%
Ratio of net investment (loss)/income to average net assets 0.02% 0.25% 0.13% -0.36% -0.50%
Portfolio Turnover Rate 100% 127% 96% 103% 88%
CENTURY SMALL CAP SELECT FUND YEAR ENDED OCTOBER 31,
INVESTOR SHARES 2007 2006 2005 2004 2003
Net Asset Value, beginning of period $ 25.40 $ 23.86 $ 22.26 $ 21.39 $ 15.35
--------- --------- --------- --------- ---------
Income from Investment Operations:
Net investment (loss)/income (a) (0.06) (0.02) (0.04) (0.15) (0.15)
Net realized and unrealized gain on investments 2.71 1.86 2.20 2.12 6.60
--------- --------- --------- --------- ---------
Total income from investment operations 2.65 1.84 2.16 1.97 6.45
--------- --------- --------- --------- ---------
Less Distributions From:
Net investment income (0.32) (0.03) -- (0.91) (0.07)
Net realized gain on investment transactions (2.01) (0.28) (0.56) (0.19) (0.35)
--------- --------- --------- --------- ---------
Total distributions (2.33) (0.31) (0.56) (1.10) (0.42)
--------- --------- --------- --------- ---------
Redemption fees --+ 0.01 --+ --+ 0.01
--------- --------- --------- --------- ---------
Net Asset Value, end of period $ 25.72 $ 25.40 $ 23.86 $ 22.26 $ 21.39
========= ========= ========= ========= =========
Total Return 11.34% 7.83% 9.87% 9.45% 43.12%
Ratios and supplemental data
Net assets, end of period (000 omitted) $ 257,750 $ 353,581 $ 407,048 $ 150,418 $ 78,959
Ratio of expenses to average net assets 1.36% 1.45% 1.35% 1.50% 1.61%
Ratio of expenses to average net assets without
giving effect to voluntary expense agreement 1.36% 1.45% 1.35% 1.50% 1.76%
Ratio of net investment (loss)/income to average net assets -0.24% -0.09% -0.17% -0.69% -0.86%
Portfolio Turnover Rate 100% 127% 96% 103% 88%
(a) Calculated based on average shares outstanding during the period.
+ Amount represents less than $0.01 per share.
See notes to financial statements.
CENTURY FUNDS 19
NOTES TO FINANCIAL STATEMENTS
(1) SIGNIFICANT ACCOUNTING POLICIES -- Century Capital Management Trust (the
"Master Trust") is registered under the Investment Company Act of 1940, as
amended, as an open-end management investment company. Century Shares Trust (the
"Trust") and Century Small Cap Select Fund (the "Fund" and together with the
Trust, the "Funds") are diversified series of the Master Trust. The following is
a summary of significant accounting policies consistently followed by both the
Trust and the Fund in the preparation of their financial statements. The
policies are in conformity with accounting principles generally accepted in the
United States of America.
A. Investment Security Valuations -- Securities listed on national securities
exchanges are valued at closing prices. Unlisted securities or listed securities
for which closing prices are not available generally are valued at the latest
bid prices. Short-term obligations, maturing in 60 days or less, are valued at
amortized cost, which approximates value. In the absence of readily available
market quotes, the Funds' portfolio securities and other assets will be valued
at fair value, as determined in good faith by the Board of Trustees, its
Valuation Committee, or the Adviser or a Delegate pursuant to instructions from
the Board of Trustees or its Valuation Committee. When determining the price for
a fair value asset, the investment advisor shall seek to determine the price
that the funds might reasonably expect to receive from the current sale of that
asset in an arm's-length transaction. Fair value determinations shall be based
upon all available factors that the investment advisor deems relevant, including
but not limited to trading volumes, the value of other financial instruments,
changes in interest rates and government actions.
In September 2006, Statement of Financial Accounting Standards No. 157, Fair
Value Measurements (SFAS 157), was issued and is effective for fiscal years
beginning after November 15, 2007. SFAS 157 defines fair value, establishes a
framework for measuring fair value and expands disclosures about fair value
measurements. At this time, management is evaluating the implications of SFAS
157 and its impact on the Funds' financial statements has not yet been
determined.
B. Securities Transactions -- Investment security transactions are recorded on a
trade date basis. Gain or loss on sales is determined by the use of a specific
identification method, for both financial reporting and federal income tax
purposes. Dividend income and distributions to shareholders are recorded on the
ex-dividend date. The Funds may invest in equity securities issued or guaranteed
by companies organized and based in countries outside of the United States.
These securities may be traded on foreign securities exchanges or in foreign
over-the-counter markets. Foreign dividend income is recorded on ex-dividend
date or as soon as practical after the Fund or Trust determine the existence of
a dividend declaration after exercising reasonable due diligence. Foreign income
and capital gain on some foreign securities may be subject to foreign
withholding taxes, which are accrued as applicable. Interest income is recorded
daily on an accrual basis.
C. Use of Estimates -- The preparation of these financial statements in
accordance with accounting principles generally accepted in the United States of
America incorporates estimates made by management in determining the reported
amounts of assets, liabilities, revenues and expenses of the Trust and Fund.
Actual results could differ from those estimates.
D. Risks and Uncertainty -- The Fund concentrates its investments in the
financial services and health care group of industries, which will subject the
Fund to the risks associated with those industries and may result in greater
fluctuation in share value than is experienced in more diversified portfolios.
In addition, the Fund invests in smaller companies, which generally involves
greater risk than investing in larger, more established companies. Investments
in securities issued by non U.S. companies have certain risks not present in
domestic issuers.
E. Multiple Classes of Shares -- The Funds offer multiple classes of shares,
which differ in their respective distribution and transfer agent fees. Transfer
agent fees for each share class are based on a per shareholder account charge.
All shareholders bear the common expenses of the Funds based upon daily net
assets of each class, without distinction between share classes.
F. Redemption Fees -- In general, shares of the Trust and Fund may be redeemed
at net asset value. However, upon the redemption of shares held less than 90
days, a fee of 1% of the current net asset value of the shares may be assessed
and retained by each for the benefit of their respective remaining shareholders
of the Trust and Fund. The redemption fee is accounted for as an addition to
paid-in-capital.
G. Income Tax Information and Distributions to Shareholders -- Each year, each
Fund intends to qualify as a regulated investment company by distributing all of
its taxable income and realized gains under Subchapter M of the Internal Revenue
Code. As a result, no provision for income taxes is required in the accompanying
financial statements. Foreign taxes are provided for based on each Fund's
understanding of the tax rules and rates that exist in the foreign markets in
which it invests. Income dividends and capital gain distributions are declared
separately for each class. Distributions are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with income
tax regulations, which may differ from generally accepted accounting principles.
Capital accounts within the financial statements are adjusted for permanent book
and tax differences.
20 CENTURY FUNDS
In order to present undistributed (distributions in excess of) net investment
income ("UNII") and accumulated net realized gain ("Accumulated Gain") more
closely to its tax character, the following accounts for each Fund were
increased (decreased):
PAID-IN
CAPITAL UNII ACCUMULATED GAIN
Century Shares Trust $ (247,377) $ 3,131,988 $(2,884,611)
Century Small Cap Select Fund $(12,560,623) $12,560,623 $ --
These adjustments have no impact on net assets or the results of operations.
Temporary differences will reverse in a subsequent period. These differences are
primarily due to equalization, partnership income, net operating losses and
losses deferred due to wash sales and excise tax regulations.
The tax-basis components of distributable earnings and the federal tax cost as
of October 31, 2007 were as follows:
CENTURY SHARES TRUST
Ordinary Income ...................................................................... $ 5,439,766
Long-term capital gains .............................................................. $ 57,108,343
Unrealized net appreciation .......................................................... $ 92,297,094
Cost for federal income tax purposes ................................................. $ 197,902,789
The tax character of distributions paid were as follows:
Ordinary Income
Institutional shares ............................................................. $ 4,517,444
Investor shares .................................................................. $ 2,257
Long-term capital gain
Institutional shares ............................................................. $ 75,570,929
Investor shares .................................................................. $ 459,673
The tax-basis components of distributable earnings and the federal tax cost as
of October 31, 2007 were as follows:
CENTURY SMALL CAP SELECT FUND
Ordinary income ...................................................................... $ 62,180,599
Long-term capital gains .............................................................. $ 2,056,828
Unrealized net appreciation .......................................................... $ 64,631,322
Cost for federal income tax purposes ................................................. $ 764,025,236
The tax character of distributions paid were as follows:
Ordinary Income
Institutional shares ............................................................. $ 4,411,492
Investor shares .................................................................. $ 7,516,448
Long-term capital gain
Institutional shares ............................................................. $ 27,610,318
Investor shares .................................................................. $ 42,614,264
In June 2006, the Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 (FIN 48) "Accounting for Uncertainty in Income Taxes". FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken in the course of preparing the Trusts' tax
returns to determine whether the tax positions are "more-likely-than-not" of
being sustained by the applicable tax authority. Tax benefits of positions not
deemed to meet the more-likely-than-not threshold would be booked as a tax
expense in the current year and recognized as: a liability for unrecognized tax
benefits; a reduction of an income tax refund receivable; a reduction of
deferred tax asset; an increase in deferred tax liability; or a combination
thereof. Adoption of FIN 48 is required for fiscal years beginning after
December 15, 2006. At this time, management is evaluating the implications of
FIN 48 and its impact in the financial statements has not yet been determined.
CENTURY FUNDS 21
(2) TRANSACTIONS IN SHARES
A. CENTURY SHARES TRUST - The number of authorized shares is unlimited, par
value $0.01. Transactions in Trust shares were as follows:
YEAR ENDED OCTOBER 31, 2007
INSTITUTIONAL SHARES INVESTOR SHARES
SHARES AMOUNT SHARES AMOUNT
Sold 207,400 $5,807,854 14,785 $415,025
Issued to shareholders in reinvestment of
distributions from:
Net investment income 133,255 3,725,818 79 2,275
Realized gain on investment transactions 2,436,217 65,004,501 17,333 457,249
----------- ------------ ---------- ------------
2,776,872 74,538,173 32,197 874,549
Repurchased (1,582,350) (44,567,517) (50,128) (1,401,751)
----------- ------------ ---------- ------------
Net increase (decrease) 1,194,522 $29,970,656 (17,931) $(527,202)
=========== ============ ========== ============
YEAR ENDED OCTOBER 31, 2006
INSTITUTIONAL SHARES INVESTOR SHARES
SHARES AMOUNT SHARES AMOUNT
Sold 140,521 $4,811,501 35,367 $1,201,981
Issued to shareholders in reinvestment of
distributions from:
Net investment income 164,017 5,489,498 2,425 83,289
Realized gain on investment transactions 502,439 17,339,169 635 21,336
----------- ------------ ---------- ------------
806,977 27,640,168 38,427 1,306,606
Repurchased (1,398,778) (47,651,748) (18,576) (633,526)
----------- ------------ ---------- ------------
Net increase (decrease) (591,801) $(20,011,580) 19,851 $673,080
=========== ============ ========== ============
B. CENTURY SMALL CAP SELECT FUND - The number of authorized shares is unlimited.
Transactions in Fund shares were as follows:
YEAR ENDED OCTOBER 31, 2007
INSTITUTIONAL SHARES INVESTOR SHARES
SHARES AMOUNT SHARES AMOUNT
Sold 6,049,719 $153,845,728 1,591,679 $39,241,334
Issued to shareholders in reinvestment of
distributions from:
Net investment income 1,019,877 24,487,404 589,489 13,959,316
Realized gain on investment transactions 922,382 22,736,723 547,709 13,314,927
----------- ------------ ---------- ------------
7,991,978 201,069,855 2,728,877 66,515,577
Repurchased (6,996,336) (177,782,464) (6,625,509) (164,921,469)
----------- ------------ ---------- ------------
Net increase (decrease) 995,642 $23,287,391 (3,896,632) $(98,405,892)
=========== ============ ========== ============
YEAR ENDED OCTOBER 31, 2006
INSTITUTIONAL SHARES INVESTOR SHARES
SHARES AMOUNT SHARES AMOUNT
Sold 10,410,981 $262,260,196 2,973,244 $73,988,591
Issued to shareholders in reinvestment of
distributions from:
Net investment income 87,940 2,140,457 18,553 446,932
Realized gain on investment transactions 276,459 6,693,063 174,747 4,179,953
----------- ------------ ---------- ------------
10,775,380 271,093,716 3,166,544 78,615,476
Repurchased (14,025,479) (358,745,524) (6,304,203) (156,881,029)
----------- ------------ ---------- ------------
Net increase (decrease) (3,250,099) $(87,651,808) (3,137,659) $(78,265,553)
=========== ============ ========== ============
22 CENTURY FUNDS
(3) INVESTMENT SECURITY TRANSACTIONS
FOR THE TRUST, other than U.S. Government obligations and certificates of
deposit, purchases and sales of investment securities aggregated $106,562,082
and $153,547,282, respectively, during the period ended October 31, 2007.
FOR THE FUND, other than U.S.Government obligations and certificates of deposit,
purchases and sales of investment securities aggregated $835,105,187 and
$985,277,184, respectively, during the year ended October 31, 2007.
(4) INVESTMENT ADVISER FEE
FOR THE TRUST, the investment adviser fee is earned by Century Capital
Management, LLC ("CCM"), as compensation for providing investment advisory
services to the Trust. CCM receives a monthly fee equal on an annualized basis
to 0.8% of the first $500 million and 0.7% of the amounts exceeding $500 million
of the Trust's average daily net assets. For the year ended October 31, 2007,
the fee amounted to $2,339,767. Officers and Trustees of the Master Trust who
are employed by CCM receive remuneration for their services out of such
investment adviser fee.
The Trust has guaranteed retirement benefits to be paid to one former Trustee.
Under the terms of the Trust's Investment Advisory and Management Agreement with
CCM, CCM has assumed the obligation to make all such payments on behalf of the
Trust during the term of the agreement. The amount of potential future payments
owed by the Trust cannot be estimated with certainty due to the variability of
amounts used to determine the payment and therefore are not reflected in the
Trust's financial statements. Retirement benefits are payable over various
periods.
FOR THE FUND, the investment adviser fee is earned by CCM as compensation for
providing investment advisory, management and administrative services to the
Fund. CCM receives a monthly fee equal on an annualized basis to 0.95% of the
Fund's average daily net assets. For the year ended October 31, 2007, the fee
amounted to $8,277,267. Officers and Trustees of the Master Trust who are
employed by CCM receive remuneration for their services out of such investment
adviser fee.
(5) ADMINISTRATION FEES -- The Trust has an Administration Agreement with CCM.
Under the agreement CCM shall provide or procure, at its expense, non-investment
advisory services to the Trust. CCMwill receive a monthly fee equal on an
annualized basis to 0.15% of the Trust's average daily net assets. The fee was
$438,706 for the year ended October 31, 2007. Per the Investment Advisory and
Management Services Agreement between the Fund and CCM, the Fund will reimburse
CCM for expenses associated with having the adviser's personnel perform
shareholder service functions and certain financial, accounting, administrative
and clerical services. During the year ended October 31, 2007 CCM was reimbursed
$61,880, which is recorded on the Statement of Operations under Administration.
(6) ADVISER REIMBURSEMENT -- CCM contractually agreed to reimburse the Trust for
60% of the distribution and service fees paid by the Trust's Investor Shares
through February 28, 2007. In addition, effective as of February 28, 2007, CCM
has contractually agreed to waive a portion of its management fee and reimburse
or pay operating expenses of the Trust's Investor Shares to the extent necessary
to maintain the total operating expenses of the Investor Shares at 1.45% through
February 28, 2008. During the year ended October 31, 2007, CCM made a
reimbursement of $5,274.
(7) DISTRIBUTION AND SERVICE PLAN -- The Trust and the Fund have adopted a
distribution and service plan for the Investor Shares under Rule 12b-1 of the
1940 Act. Distribution plans permit a fund to pay for all or a portion of the
costs incurred in connection with the distribution and/or servicing of shares.
The Investor Shares currently pays a distribution and service fee up to 0.25% of
the average daily net assets of the class. During the year ended October 31,
2007, $3,377 and $500,201 for the Trust and Fund, respectively, was paid under
the distribution and service plan. The plan may be terminated at any time by the
vote of a majority of the independent Trustees or by the vote of the holders of
a majority of the outstanding shares of the Investor Shares.
CENTURY FUNDS 23
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Trustees and Shareholders of
Century Capital Management Trust:
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Century Shares Trust and Century Small Cap
Select Fund (the "Funds"), each a series of Century Capital Management Trust, as
of October 31, 2007, and the related statements 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 periods
presented. These financial statements and financial highlights are the
responsibility of the Funds' management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with 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. The Funds
are not required to have, nor were we engaged to perform, an audit of their
internal control over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Funds' internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of October 31, 2007, by correspondence with the custodian
and brokers; where replies were not received from brokers, we performed other
auditing procedures. 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
Century Shares Trust and Century Small Cap Select Fund as of October 31, 2007,
the results of their operations for the year then ended, the changes in their
net assets for each of the two years in the period then ended, and the financial
highlights for each of the periods presented, in conformity with accounting
principles generally accepted in the United States of America.
/s/ Deloitte & Touche
Boston, Massachusetts
December 21, 2007
24 CENTURY FUNDS
SHAREHOLDER MEETING RESULTS
A Special Meeting of Shareholders of Century Capital Management Trust, was held
on July 30, 2007. At the meeting, the following persons were elected to the
Board of Trustees: William Gray, Stephen W. Kidder, Jerrold Mitchell, Jerry S.
Rosenbloom, David D. Tripple, Laura A. Johnson, Ellen M. Zane, Alexander L.
Thorndike and Davis R. Fulkerson. In addition, the shareholders of Century
Shares Trust approved all proposals to amend, eliminate or reclassify the Fund's
fundamental investment policies. The meeting was adjourned with respect to the
proposals to amend the fundamental investment policies of Century Small Cap
Select Fund in order to give the Fund's shareholders additional time to respond
to the solicitation of proxies. The meeting was reconvened on August 22, 2007,
at which time shareholders approved the proposals to amend the fundamental
investment policies regarding borrowing money, the issuance of senior
securities, underwriting securities and making loans. The proposals to amend the
policies regarding investing in real estate and commodities were not approved.
The results of the voting on each Proposal are set forth below.
PROPOSAL I: TO ELECT A BOARD OF TRUSTEES.
% OF % OF
OUTSTANDING VOTED
FOR SHARES SHARES WITHHELD
William Gray 32,729,733.613 73.977% 98.366% 543,634.681
Stephen W. Kidder 32,727,370.788 73.971% 98.359% 545,997.506
Jerrold Mitchell 32,719,184.744 73.953% 98.334% 554,183.550
Jerry S. Rosenbloom 32,732,001.792 73.982% 98.373% 541,366.502
David D. Tripple 32,726,345.950 73.969% 98.356% 547,022.344
Laura A. Johnson 32,702,263.295 73.915% 98.284% 571,104.999
Ellen M. Zane 32,730,758.922 73.979% 98.369% 542,609.372
Alexander L. Thorndike 32,743,357.816 74.007% 98.407% 530,010.478
Davis R. Fulkerson 32,752,904.678 74.029% 98.436% 520,463.616
CENTURY SMALL CAP SELECT FUND
PROPOSAL II.A: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING BORROWING MONEY.
% of % of
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 19,104,225.110 56.180% 69.993%
Against 1,127,007.343 3.314% 4.129%
Abstain 196,728.045 0.579% 0.721%
Broker Non-votes 6,866,324.470 20.192% 25.157%
TOTAL 27,294,284.968 80.265% 100.000%
PROPOSAL II.B: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING THE ISSUANCE OF SENIOR SECURITIES.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 18,720.464.854 55.052% 68.587%
Against 1,491,759.291 4.387% 5.465%
Abstain 215,736.353 0.634% 0.790%
Broker Non-votes 6,866,324.470 20.192% 25.157%
TOTAL 27,294,284.968 80.265% 100.000%
PROPOSAL II.C: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING UNDERWRITING SECURITIES.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 18,799,073.943 55.283% 68.875%
Against 1,399,628.668 4.116% 5.128%
Abstain 229,257.887 0.674% 0.840%
Broker Non-votes 6,866,324.470 20.192% 25.157%
TOTAL 27,294,284.968 80.265% 100.000%
CENTURY FUNDS 25
PROPOSAL II.D: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING INVESTING IN REAL ESTATE.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 15,988,461.744 47.018% 58.578%
Against 4,234,132.617 12.451% 15.513%
Abstain 205,366.137 0.604% 0.752%
Broker Non-votes 6,866,324.470 20.192% 25.157%
TOTAL 27,294,284.968 80.265% 100.000%
PROPOSAL II.E: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING INVESTING IN COMMODITIES.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 15,697,405.727 46.162% 57.512%
Against 4,510,435.499 13.264% 16.525%
Abstain 220,119.272 0.647% 0.806%
Broker Non-votes 6,866,324.470 20.192% 25.157%
TOTAL 27,294,284.968 80.265% 100.000%
PROPOSAL II.F: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING MAKING LOANS.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 18,727,431.680 55.072% 68.613%
Against 1,491,280.762 4.385% 5.464%
Abstain 209,248.056 0.615% 0.767%
Broker Non-votes 6,866,324.470 20.192% 25.157%
TOTAL 27,294,284.968 80.265% 100.000%
CENTURY SHARES TRUST
PROPOSAL II.A: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING BORROWING MONEY.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,131,217.135 40.351% 69.094%
Against 379,636.208 3.708% 6.349%
Abstain 175,545.983 1.715% 2.936%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL II.B: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING THE ISSUANCE OF SENIOR SECURITIES.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,120,110.885 40.242% 68.909%
Against 392,898.646 3.838% 6.571%
Abstain 173,389.795 1.694% 2.900%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
26 CENTURY FUNDS
PROPOSAL II.C: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING UNDERWRITING SECURITIES.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,184,450.581 40.871% 69.985%
Against 329,651.476 3.220% 5.513%
Abstain 172,297.269 1.683% 2.882%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL II.D: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING INVESTING IN REAL ESTATE.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,112,322.607 40.166% 68.778%
Against 406,451.744 3.970% 6.798%
Abstain 167,624.975 1.637% 2.804%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL II.E: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING INVESTING IN COMMODITIES.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,088,543.384 39.934% 68.381%
Against 429,425.056 4.194% 7.182%
Abstain 168,430.886 1.645% 2.817%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL II.F: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT POLICY
REGARDING MAKING LOANS.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,092,876.303 39.976% 68.453%
Against 426,833.651 4.169% 7.139%
Abstain 166,689.372 1.628% 2.788%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL III.A: TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL INVESTMENT POLICY
REGARDING DIVERSIFICATION.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,149,513.417 40.530% 69.400%
Against 367,310.803 3.588% 6.143%
Abstain 169,575.106 1.656% 2.836%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
CENTURY FUNDS 27
PROPOSAL III.B: TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL INVESTMENT POLICY
REGARDING COMPANIES WITH FEWER THAN THREE YEARS CONTINUOUS OPERATIONS.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,097,789.202 40.024% 68.535%
Against 406,330.730 3.969% 6.796%
Abstain 182,279.394 1.780% 3.049%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL III.C: TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL INVESTMENT POLICY
REGARDING INVESTING FOR CONTROL.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,083,482.223 39.885% 68.296%
Against 419,234.451 4.095% 7.012%
Abstain 183,682.652 1.794% 3.072%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL III.D: TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL INVESTMENT POLICY
REGARDING COMPANIES IN WHICH TRUSTEES AND OFFICERS ARE SHAREHOLDERS.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,063,132.760 39.686% 67.956%
Against 433,915.715 4.238% 7.257%
Abstain 189,350.851 1.849% 3.167%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL IV.A: TO APPROVE THE RECLASSIFICATION OF THE POLICY REGARDING DEBT
SECURITIES AS NON-FUNDAMENTAL.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,113,419.634 40.177% 68.797%
Against 372,955.201 3.643% 6.238%
Abstain 200,024.491 1.954% 3.345%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
PROPOSAL IV.B: TO APPROVE THE RECLASSIFICATION OF THE POLICY REGARDING
INVESTMENT COMPANIES AS NON-FUNDAMENTAL.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,102,872.691 40.074% 68.620%
Against 369,021.752 3.604% 6.172%
Abstain 214,504.883 2.095% 3.588%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
28 CENTURY FUNDS
PROPOSAL IV.C: TO APPROVE THE RECLASSIFICATION OF THE POLICY REGARDING MARGIN
PURCHASES AND SHORT SALES AS NON-FUNDAMENTAL.
% OF % OF
OUTSTANDING VOTED
SHARES VOTED SHARES SHARES
For 4,056,781.542 39.624% 67.850%
Against 445,653.556 4.353% 7.454%
Abstain 183,964.228 1.797% 3.077%
Broker Non-votes 1,292,684.000 12.626% 21.620%
TOTAL 5,979,083.326 58.400% 100.000%
CENTURY FUNDS 29
MANAGEMENT OF THE FUNDS
The following table provides certain information regarding the Trustees and
officers of Century Shares Trust and Century Small Cap Select Fund as of October
31, 2007. Unless otherwise noted, (i) each Trustee and officer has engaged in
the principal occupation(s) noted in the table for at least the most recent five
years, although not necessarily in the same capacity, and (ii) the address of
each Trustee and officer is c/o Century Capital Management, 100 Federal Street,
29th Floor, Boston, Massachusetts 02110. Each Trustee's term of office continues
until the Trustee retires, resigns or is removed in accordance with the
Declaration of Trust or until the next shareholders' meeting called for the
purpose of electing Trustees and until the election and qualification of a
successor.
INDEPENDENT TRUSTEES
NAME, AGE, POSITION(S) NO. OF
HELD WITH TRUST AND PRINCIPAL OCCUPATION DURING PAST 5 YEARS PORTFOLIOS
LENGTH OF TIME SERVED AND OTHER DIRECTORSHIPS HELD IN FUND
COMPLEX
OVERSEEN
WILLIAM GRAY (55) Co-Chief Executive Officer, North America Region, Ogilvy & Mather Worldwide 2
Trustee, 2006 to present (advertising firm) (2005 to present); President, Ogilvy & Mather, New York (1997
to 2005). Other Directorships: American Red Cross of Greater New York, Chairman
(since 2002), Member (since 1999); The New York Public Library (since 1999); The
National Advertising Review Board (since 2001); Wakeman Boys Club (since 1989).
LAURA A. JOHNSON (53) President, Massachusetts Audubon Society (1999 to present). Other directorships: 2
Trustee, July 31, 2007 to present Massachusetts Department of Conservation and Recreation (2004 to present); Woods
Hole Oceanographic Institute (2003 to
present); The Fenn School, Concord,
Massachusetts (2001-2007).
STEPHEN W. KIDDER (54) Managing Partner, Hemenway & Barnes (law firm). Other Directorships: Trustee, 2
Trustee, 2005 to present Wellesley College; Trustee, Isabella Stewart Gardner Museum; Trustee, Children's
Hospital Trust; Director, The Concord Bookshop, Inc.
JERROLD MITCHELL (68) Independent Investment Adviser (since 1995); Senior Advisor, Saltonstall & Co. 2
Trustee, 2004 to present (family investment office) (April 2007 to present); Chief Investment Officer, The
Boston Foundation (2005 to 2007); Chief Investment Officer, Massachusetts Pension
Reserves Investment Management Board (2001 to 2004). Other Directorships: Trustee,
Boston Athenaeum; Trustee, Yale Library Associates; Trustee, Trustees of Donations;
Commissioner of Trust Funds, Town of Wayland.
JERRY S. ROSENBLOOM (68) The Wharton School, University of Pennsylvania, Professor of Insurance and Risk 2
Trustee, 1998 to present Management and Academic Director, Certified Employee Benefit Specialist Program.
Other Directorships: Harleysville Group, Inc.; American Institute for Chartered
Property Casualty Underwriters.
DAVID D. TRIPPLE (63) Pioneer Investment Management, a subsidiary of UniCredito Italiano (investment 2
Trustee, 2004 to present adviser), Chief Executive Officer and Trustee of all U.S. Pioneer mutual funds (10/00
to 09/01); prior thereto, The Pioneer Group, Inc. (asset management), Executive Vice
President and Director (09/98 to 10/00). Other Directorships: The Calamos Funds
(16 portfolios).
ELLEN M. ZANE (56) President and Chief Executive Officer, Tufts-New England Medical Center & Floating 2
Trustee, Elected July 31, 2007 Hospital for Children (2004 to present); prior thereto, Network President, Partners
Healthcare System (1994-2004). Other directorships: Fiduciary Trust Company (2000
to present); Parexel International Corporation (2006 to present); John F.
Kennedy Library Foundation (1999 to present); Harvard School of Public Health,
Health Policy & Management Executive Council (1999 to present); Northeastern
University (2004 to present); Tufts University School of Medicine (2005 to
present); Massachusetts Hospital Association (2005 to present).
30 CENTURY FUNDS
INTERESTED TRUSTEES AND OFFICERS (1)
NAME, AGE, POSITION(S) NO. OF
HELD WITH TRUST AND PRINCIPAL OCCUPATION DURING PAST 5 YEARS PORTFOLIOS
LENGTH OF TIME SERVED AND OTHER DIRECTORSHIPS HELD IN FUND
COMPLEX
OVERSEEN
ALEXANDER L. THORNDIKE (41) Managing Partner, Century Capital Management, LLC; Managing Member, CCP 2
Trustee and Portfolio Manager, Capital II, LLC (since 1999) (investment management services); Member, CCP
1999 to present; Chairman and Capital IV, LLC (since 2007) (investment management). No other directorships held.
Chief Executive Officer,
2004 to present
DAVIS R. FULKERSON (42) Managing Partner, Century Capital Management, LLC; Managing Member, CCP 2
Trustee, 2000 to present Capital II, LLC (since 1999) (investment management services); President and
Director, CCP Capital III, Inc. (since 2001) (investment management services);
Member, CCP Capital IV, LLC (since 2006) (investment management services).
No other directorships held.
SANDRA F. HAZEL (36) Director of Finance and Accounting, Century Capital Management, LLC. N/A
Chief Financial Officer,
2007 to present
Maureen E. Kane (45) General Counsel, Century Capital Management, LLC, (2004-present); prior thereto, N/A
Chief Legal Officer, 2006 to Vice President, Deutsche Asset Management (1997-2004).
present; Chief Compliance Officer
and Secretary, 2007 to present
The Funds' Statement of Additional Information ("SAI") includes additional
information about the Trustees. The SAI is available, without charge, upon
request. If you would like to request a copy of the SAI, you may do so by
calling the following toll-free number: 1-800-321-1928.
Availability of Quarterly Portfolio Schedules. Each fund files a complete
schedule of its portfolio holdings with the SEC for the first and third quarters
of the fund's fiscal year on Form N-Q. The Forms N-Q are available on the SEC's
website at http://www.sec.gov, and they may be reviewed and copied at the SEC's
Public Reference Room in Washington, DC. Information on the operation of the
SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
Availability of Proxy Voting Policies and Procedures and Proxy Voting Record. A
description of the policies and procedures that each fund uses to determine how
to vote proxies relating to portfolio securities and each fund's proxy voting
record for the 12-month period ended June 30 are available, without charge, upon
request, by calling 1-800-321-1928. You may also obtain a copy of the funds'
proxy voting policies and procedures and proxy voting record on the SEC's
website at http://www.sec.gov.
-----------------------
(1) Each person listed is considered an "interested person" of the funds within
the meaning of the 1940 Act by virtue of being an officer or employee of
the Adviser.
INVESTMENT ADVISER
Century Capital Management, LLC
100 Federal Street
Boston, Massachusetts 02110
SHAREHOLDER HOTLINE
800-303-1928
WEBSITE
www.centuryfunds.com
CENTURY FUNDS 31
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32 CENTURY FUNDS
Logo: CENTURY
Logo: CENTURY FUNDS
100 Federal Street Boston, Massachusetts 02110
CCMT A
OCT 2007
Item 2. Code of Ethics.
As of the end of the period covered by this report, Century Capital Management
Trust has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that
applies to its Principal Executive Officer and Principal Financial Officer.
During the period covered by this report, there were no amendments to, or
waivers from, any provision of the code of ethics.
A copy of the code of ethics is filed as an exhibit hereto.
Item 3. Audit Committee Financial Expert.
The Board of Trustees has determined that Jerry Rosenbloom, who is a member
of the Century Capital Management Trust Board of Trustees and Audit
Committee, qualifies as an audit committee financial expert. Mr. Rosenbloom
is an independent trustee, as defined in paragraph (a)(2) of this item's
instructions. The SEC has stated that the designation or identification of
a person as an audit committee financial expert pursuant to this Item 3 of
Form N-CSR does not impose on such person any duties, obligations or
liability that are greater than the duties, obligations and liability
imposed on such person as a member of the Audit Committee and the Board of
Trustees in the absence of such designation or identification.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees. The aggregate fees billed to the Trust for each of the last two
fiscal years for professional services rendered by the principal accountant
for the audit of the financial statements of Century Capital Management
Trust (the "Trust") or services that are normally provided by the
accountant in connection with statutory and regulatory filings or
engagements for these fiscal years were as follows:
FYE Audit Fees
--- ----------
10/31/07 $69,000
10/31/06 $64,000
(b) Audit-Related Fees. For each of the last two fiscal years, there were no
fees billed to the Trust for assurance and related services by the
principal accountant that are reasonably related to the performance of the
audit of the Trust's financial statements and are not reported under Audit
Fees. For each of the last two fiscal years of the Trust, there were no
audit-related fees billed by the Fund's principal accountant to the Trust's
investment adviser and any entity controlling, controlled by, or under
common control with the adviser that provides ongoing services to the Fund
(together, "Adviser Related Entities") for services that were related
directly to the operations and financial reporting of the Trust.
(c) Tax Fees. The aggregate fees billed to the Trust for each of the last two
fiscal years for professional services provided by the Trust's principal
accountant for tax compliance, tax advice and tax planning were as follows:
FYE Tax Fees
--- ----------
10/31/07 $9,800
10/31/06 $9,000
For the last two fiscal years of the Trust, there were no tax fees billed
by the Fund's principal accountant to Adviser Related Entities for
services that were related directly to the operations and financial
reporting of the Trust.
(d) All Other Fees. All Other Fees are fees related to services other than
those reported above under "Audit Fees," "Audit-Related Fees," and "Tax
Fees." For each of the Trust's last two fiscal years, no such fees were
billed by the Trust's principal accountant to the Trust or to Adviser
Related Entities for services related directly to the operations and
financial reporting of the Trust.
(e) (1) The Audit Committee's pre-approval policies and procedures are as
follows:
The Charter of the Audit Committee of the Board requires that the Committee
approve (a) all audit and permissible non-audit services to be provided to
the Funds and (b) all permissible non-audit services to be provided by the
Funds' independent auditors to the Funds' investment adviser or any entity
controlling, controlled by, or under common control with the investment
adviser that provides ongoing services to the Funds, if the engagement
relates directly to the operations and financial reporting of the Funds.
(2) No services described in each of paragraphs (b) through (d) of this
Item were approved by the Audit Committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Not applicable
(g) The aggregate non-audit fees billed by the Trust's accountant, for the
Trust's last two fiscal years, for services rendered to the Trust and
Adviser Related Entities are shown in the table below:
Non-Audit Fees
Non-Audit Fees for Adviser Aggregate
for Trust Related Entities Non-Audit Fees
FYE
October 31, 2007 None None None
October 31, 2006 None None None
(h) The Audit Committee of the Board of Trustees has considered whether the
provision of services other than audit services performed by the auditors
to the Registrant is compatible with maintaining the auditors' independence
in performing audit services.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
Schedule of Investments is included as part of the report to shareholders
filed under Item 1 of this Form.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchases.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which
shareholders may recommend nominees to the Trust's Board of Trustees since the
Trust last provided disclosure as to such procedures in response to the
requirements of Item 407(c)(2)(iv) of Regulation S-K (as required by Item
22(b)(15) of Schedule 14A), or this Item.
Item 11. Controls and Procedures.
(a) The registrant's principal executive officer and principal financial
officer, after evaluating the effectiveness of the registrant's "disclosure
controls and procedures" (as defined in the Investment Company Act of 1940 Rule
30-a-2(c) under the Act (17 CFR 270.30a-2(c))) as of a date (the "Evaluation
Date") within 90 days of the filing date of this report, have concluded that, as
of the Evaluation Date, the registrant's disclosure controls and procedures were
adequately designed to ensure that the information required to be disclosed by
the registrant in this Form N-CSR is recorded, processed, summarized and
reported within the time periods specified in the Commission's rules and forms.
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR
270.30a-3(d))) that occurred during the registrant's second fiscal quarter of
the period covered by this report that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control over financial
reporting.
Items 12. Exhibits.
(a) Fund's Code of Ethics. The registrant's code of ethics required to be
disclosed under Item 2 of Form N-CSR attacheded hereto as Exhibit 99.CODE ETH.
(b) Attached hereto.
Exhibit 99.CERT A separate certification for each principal
executive officer and principal financial
officer of the registrant as required by
Rule 30a-2 of the Investment Company
Act of 1940.
SIGNATURES
Pursuant to the requirement 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.
Century Capital Management Trust
By: /s/ Alexander L. Thorndike
---------------------------------------------------------
Alexander L. Thorndike, Chairman
Date: January 9, 2008
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 indicate.
By: /s/ Alexander L. Thorndike
------------------------------------------------------------------
Alexander L. Thorndike, Chairman (Principal Executive Officer)
Date: January 9, 2008
By: /s/ Sandra Hazel
------------------------------------------------------------------
Sandra Hazel, Chief Financial Officer (Principal Financial Officer)
Date: January 9, 2008