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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 811-05685
-----------------------------------------
Williamsburg Investment Trust
-----------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
135 Merchant Street, Suite 230 Cincinnati, Ohio 45246
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(Address of principal executive offices) (Zip code)
W. Lee H. Dunham, Esq.
Sullivan & Worcester LLP One Post Office Square Boston, Massachusetts 02109
-----------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (513) 587-3400
----------------
Date of fiscal year end: March 31, 2004
---------------------------
Date of reporting period: March 31, 2004
---------------------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
================================================================================
THE
[GRAPHIC OMITTED] FLIPPIN, BRUCE & PORTER
FUNDS
-------------------------------
FBP CONTRARIAN EQUITY FUND
FBP CONTRARIAN BALANCED FUND
ANNUAL REPORT
MARCH 31, 2004
NO-LOAD FUNDS
================================================================================
Letter to Shareholders May 14, 2004
================================================================================
When we wrote to you a year ago in the Funds' annual report, we expected better
returns from stocks for a number of reasons. Expectations were low, consumer
spending was stable, and the Federal Reserve was accommodative due to low
inflation and concerns over employment growth and potential deflation. Deficit
spending, along with substantial tax cuts, also provided significant fiscal
stimulus. The economy responded with vigorous Gross Domestic Product growth,
thus driving earnings up approximately 12% in 2003 and an expected 18% in 2004.
Stocks, as measured by the S&P 500, responded strongly with a total return of
35.1%. Leadership was provided by sectors of the market that perform well in the
early stages of an economic recovery. Materials, Financials, Information
Technology and Consumer Discretionary all produced exceptional returns.
Healthcare and Consumer Staples were the two weakest S&P groups. Bonds also
produced positive returns, with the Lehman Government/Credit Index up 6.2%.
Short-term interest rates moved lower last June as the Federal Reserve cut the
Fed Funds rate to 1%, a level that is still maintained today. Intermediate to
longer rates changed little year over year, but did display a fair amount of
movement over the course of the year responding to investors perception of
economic growth or deflation possibilities at the time.
We are pleased to report the results of your Funds for the fiscal year ending
March 31, 2004. The following table displays the annualized total return
(capital change plus income) of the Funds for the most recent year and longer
time periods.
Twelve Three Five
Months Years Years
------ ----- -----
FBP Contrarian Equity Fund 46.60% 5.52% 3.56%
FBP Contrarian Balanced Fund 33.19% 6.35% 4.85%
S&P 500 Index 35.12% 0.63% -1.20%
Russell 1000 Value Index 40.82% 4.30% 3.88%
Lehman Government/Credit Index 6.15% 8.00% 7.56%
As the fiscal year began, the equity portion of the Funds' portfolios were
positioned to perform well if the economy improved, which fortunately led to
excellent performance. Consumer Discretionary (+81.3%), Industrials (+72.6%),
Consumer Staples (+63.1%) and Materials (+59.3%) were our strongest sectors, all
outperforming the S&P 500. Telecommunications (+7.2%), lack of exposure to
Utilities, and an underweight in Information Technology (+38.9) held back
returns. While the overall sector exposure added to returns, stock selection was
the primary driver in the Funds' above market returns. The five top and bottom
contributors to performance were:
Top Contributor * (Fiscal Year Return) Bottom Contributor * (Fiscal Year Return)
- -------------------------------------- -----------------------------------------
Cendant Corp 105.2% Johnson & Johnson -9.7%
Tyco International 127.1% Merck & Co -13.2%
JP Morgan Chase 83.9% Computer Sciences 6.1%
Best Buy, Inc 83.3% Eastman Kodak -19.0%
Citigroup Inc 52.6% Electronic Data Systems -0.8%
* Contribution rankings are determined by combining period return and
portfolio weighting for the Equity Fund. The equity portion of the Balanced
Fund contributors would be substantially the same.
1
The bond portion of the Balanced Fund performed slightly better than the Lehman
Government/Credit Index, but with much less volatility as its maturity structure
was much shorter. The Balanced Fund's asset mix was invested more heavily to
stocks over the past year, also benefiting the Fund.
The investment climate has changed significantly since last year. Economic
growth appears to have a solid foundation now that business spending and
employment are improving. However, growth should moderate from the past years'
strong pace. Some inflationary pressure is becoming evident as higher energy,
food and other commodity costs pass through the system. Thus, the Federal
Reserve is now in a position to begin raising short-term interest rates to a
more normal level. Both bonds and stocks have adjusted to a degree for this
policy change. Intermediate and longer-term interest rates have already risen
approximately 1% since mid-March. Even with strongly rising corporate profits,
stocks have declined since the end of March, reflecting a lower price
earnings/ratio due to expected and actual higher interest rates. In our view,
this is a normal market reaction to a changed Fed outlook. We believe the P/E
adjustment is close to running its course, thus continued strong corporate
profits will be the driver of future stock gains.
We have made a number of changes to the Funds' portfolios to position them to
perform well as we move forward. The transition out of a number of stocks
approaching our full value target prices and into stocks that we judged to be
significantly undervalued occurred in 2003 and continued in the first quarter of
2004. Most of the stocks we reduced or eliminated were in economically sensitive
sectors such as Consumer Discretionary, Materials and Industrials. As noted
previously, these groups had performed especially well since March 2003,
contributing to the fund's strong returns over the last year. We have redeployed
the proceeds from these sales most notably increasing the Health Care sector.
There we have added a number of stocks that have lagged the overall market but
possess attractive valuations when compared to both their own history as well as
the market, and in addition offer predictable earnings growth. Some examples
include Anthem, Cigna, Hospital Corp of America, Pfizer, and Cardinal Heath. We
believe these stocks will perform well as this market cycle matures into its
middle and latter stages. The fixed income portion of the Fund continues to be
positioned defensively so as to protect the principal value of the bond portion
should interest rates continue to mover higher.
Please visit our website at www.fbpinc.com for information on our firm,
philosophy, investment process and most importantly, our people. We are very
proud of our experienced, dedicated and stable staff. As always, we thank you
for your continued confidence and investment in The Flippin, Bruce & Porter
Funds.
/s/ John T. Bruce
John T. Bruce, CFA
President - Portfolio Manager
2
COMPARATIVE CHARTS
================================================================================
Performance for each Fund is compared to the most appropriate broad-based index,
the S&P 500, an unmanaged index of 500 large common stocks. Over time, this
index has the potential to outpace the FBP Contrarian Balanced Fund, which
normally maintains at least 25% in bonds. Balanced funds have the growth
potential to outpace inflation, but they will typically lag a 100% stock index
over the long term because of the bond portion of their portfolios. However, the
advantage of the bond portion is that it can make the return and principal of a
balanced fund more stable than a portfolio completely invested in stocks.
Results are also compared to the Consumer Price Index, a measure of inflation.
FBP CONTRARIAN EQUITY FUND
--------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE FBP CONTRARIAN
EQUITY FUND, THE STANDARD & POOR'S 500 INDEX AND THE CONSUMER PRICE INDEX
[GRAPHIC OMITTED]
STANDARD & POOR'S 500 INDEX: FBP CONTRARIAN EQUITY FUND:
---------------------------- ---------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 10,000 03/31/94 10,000
06/30/94 0.42% 10,042 06/30/94 0.69% 10,069
09/30/94 4.89% 10,534 09/30/94 7.34% 10,808
12/31/94 -0.02% 10,531 12/31/94 -1.30% 10,667
03/31/95 9.74% 11,557 03/31/95 6.42% 11,352
06/30/95 9.55% 12,660 06/30/95 9.37% 12,415
09/30/95 7.95% 13,666 09/30/95 8.53% 13,475
12/31/95 6.02% 14,489 12/31/95 3.24% 13,911
03/31/96 5.37% 15,267 03/31/96 5.71% 14,706
06/30/96 4.49% 15,952 06/30/96 4.54% 15,373
09/30/96 3.09% 16,445 09/30/96 2.42% 15,744
12/31/96 8.34% 17,816 12/31/96 8.47% 17,078
03/31/97 2.68% 18,293 03/31/97 1.30% 17,301
06/30/97 17.46% 21,487 06/30/97 13.93% 19,711
09/30/97 7.49% 23,097 09/30/97 9.47% 21,577
12/31/97 2.87% 23,760 12/31/97 -0.73% 21,419
03/31/98 13.95% 27,074 03/31/98 12.19% 24,030
06/30/98 3.30% 27,968 06/30/98 -0.35% 23,946
09/30/98 -9.95% 25,186 09/30/98 -15.36% 20,269
12/31/98 21.30% 30,550 12/31/98 24.61% 25,257
03/31/99 4.98% 32,072 03/31/99 2.51% 25,891
06/30/99 7.05% 34,333 06/30/99 13.47% 29,378
09/30/99 -6.24% 32,189 09/30/99 -13.16% 25,511
12/31/99 14.88% 36,979 12/31/99 2.69% 26,198
03/31/00 2.29% 37,827 03/31/00 -6.51% 24,492
06/30/00 -2.66% 36,822 06/30/00 -3.59% 23,611
09/30/00 -0.97% 36,465 09/30/00 4.01% 24,557
12/31/00 -7.82% 33,612 12/31/00 4.64% 25,696
03/31/01 -11.86% 29,627 03/31/01 2.15% 26,249
06/30/01 5.85% 31,361 06/30/01 7.42% 28,195
09/30/01 -14.68% 26,758 09/30/01 -12.12% 24,778
12/31/01 10.69% 29,617 12/31/01 15.51% 28,620
03/31/02 0.27% 29,698 03/31/02 0.14% 28,660
06/30/02 -13.40% 25,720 06/30/02 -12.74% 25,009
09/30/02 -17.28% 21,276 09/30/02 -16.85% 20,796
12/31/02 8.44% 23,071 12/31/02 7.75% 22,408
03/31/03 -3.15% 22,345 03/31/03 -6.14% 21,033
06/30/03 15.39% 25,784 06/30/03 19.79% 25,194
09/30/03 2.65% 26,467 09/30/03 4.57% 26,346
12/31/03 12.18% 29,689 12/31/03 12.20% 29,560
03/31/04 1.69% 30,192 03/31/04 4.31% 30,835
CONSUMER PRICE INDEX:
---------------------
QTRLY
DATE RETURN BALANCE
---- ------ -------
03/31/94 10,000
06/30/94 0.60% 10,060
09/30/94 0.90% 10,151
12/31/94 0.60% 10,212
03/31/95 0.80% 10,294
06/30/95 0.90% 10,387
09/30/95 0.40% 10,428
12/31/95 0.50% 10,481
03/31/96 0.80% 10,565
06/30/96 1.10% 10,681
09/30/96 0.44% 10,728
12/31/96 0.82% 10,817
03/31/97 0.70% 10,892
06/30/97 0.19% 10,913
09/30/97 0.44% 10,960
12/31/97 0.62% 11,028
03/31/98 0.12% 11,042
06/30/98 0.56% 11,104
09/30/98 0.42% 11,150
12/31/98 0.42% 11,198
03/31/99 0.24% 11,224
06/30/99 0.91% 11,327
09/30/99 0.54% 11,388
12/31/99 0.78% 11,477
03/31/00 0.95% 11,586
06/30/00 1.00% 11,702
09/30/00 0.76% 11,790
12/31/00 0.75% 11,879
03/31/01 0.98% 11,995
06/30/01 1.08% 12,125
09/30/01 -0.11% 12,111
12/31/01 -0.06% 12,104
03/31/02 0.23% 12,132
06/30/02 1.12% 12,268
09/30/02 0.50% 12,329
12/31/02 0.33% 12,370
03/31/03 0.99% 12,492
06/30/03 0.22% 12,520
09/30/03 0.60% 12,595
12/31/03 -0.05% 12,589
03/31/04 0.92% 12,705
Past performance is not predictive of future performance.
3
FBP CONTRARIAN BALANCED FUND
----------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE FBP CONTRARIAN
BALANCED FUND, THE STANDARD & POOR'S 500 INDEX AND THE CONSUMER PRICE INDEX
[GRAPHIC OMITTED]
STANDARD & POOR'S 500 INDEX: FBP CONTRARIAN BALANCED FUND:
---------------------------- ----------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 10,000 03/31/94 10,000
06/30/94 0.42% 10,042 06/30/94 0.12% 10,012
09/30/94 4.89% 10,534 09/30/94 4.83% 10,496
12/31/94 -0.02% 10,531 12/31/94 -0.97% 10,394
03/31/95 9.74% 11,557 03/31/95 6.35% 11,054
06/30/95 9.55% 12,660 06/30/95 7.70% 11,904
09/30/95 7.95% 13,666 09/30/95 6.43% 12,670
12/31/95 6.02% 14,489 12/31/95 3.10% 13,063
03/31/96 5.37% 15,267 03/31/96 3.96% 13,581
06/30/96 4.49% 15,952 06/30/96 3.40% 14,042
09/30/96 3.09% 16,445 09/30/96 1.70% 14,281
12/31/96 8.34% 17,816 12/31/96 6.62% 15,227
03/31/97 2.68% 18,293 03/31/97 0.92% 15,366
06/30/97 17.46% 21,487 06/30/97 11.41% 17,119
09/30/97 7.49% 23,097 09/30/97 7.62% 18,423
12/31/97 2.87% 23,760 12/31/97 -0.30% 18,368
03/31/98 13.95% 27,074 03/31/98 8.94% 20,010
06/30/98 3.30% 27,968 06/30/98 0.90% 20,190
09/30/98 -9.95% 25,186 09/30/98 -10.04% 18,164
12/31/98 21.30% 30,550 12/31/98 16.44% 21,149
03/31/99 4.98% 32,072 03/31/99 2.88% 21,758
06/30/99 7.05% 34,333 06/30/99 8.78% 23,668
09/30/99 -6.24% 32,189 09/30/99 -9.14% 21,506
12/31/99 14.88% 36,979 12/31/99 3.56% 22,272
03/31/00 2.29% 37,827 03/31/00 -4.14% 21,350
06/30/00 -2.66% 36,822 06/30/00 -3.07% 20,695
09/30/00 -0.97% 36,465 09/30/00 4.03% 21,529
12/31/00 -7.82% 33,612 12/31/00 4.54% 22,506
03/31/01 -11.86% 29,627 03/31/01 1.82% 22,916
06/30/01 5.85% 31,361 06/30/01 5.04% 24,072
09/30/01 -14.68% 26,758 09/30/01 -6.91% 22,409
12/31/01 10.69% 29,617 12/31/01 10.40% 24,740
03/31/02 0.27% 29,698 03/31/02 -0.21% 24,687
06/30/02 -13.40% 25,720 06/30/02 -8.71% 22,537
09/30/02 -17.28% 21,276 09/30/02 -10.78% 20,107
12/31/02 8.44% 23,071 12/31/02 6.15% 21,345
03/31/03 -3.15% 22,345 03/31/03 -3.03% 20,697
06/30/03 15.39% 25,784 06/30/03 14.38% 23,675
09/30/03 2.65% 26,467 09/30/03 3.34% 24,466
12/31/03 12.18% 29,689 12/31/03 8.98% 26,663
03/31/04 1.69% 30,192 03/31/04 3.39% 27,567
CONSUMER PRICE INDEX:
---------------------
QTRLY
DATE RETURN BALANCE
---- ------ -------
03/31/94 10,000
06/30/94 0.60% 10,060
09/30/94 0.90% 10,151
12/31/94 0.60% 10,212
03/31/95 0.80% 10,294
06/30/95 0.90% 10,387
09/30/95 0.40% 10,428
12/31/95 0.50% 10,481
03/31/96 0.80% 10,565
06/30/96 1.10% 10,681
09/30/96 0.44% 10,728
12/31/96 0.82% 10,817
03/31/97 0.70% 10,892
06/30/97 0.19% 10,913
09/30/97 0.44% 10,960
12/31/97 0.62% 11,028
03/31/98 0.12% 11,042
06/30/98 0.56% 11,104
09/30/98 0.42% 11,150
12/31/98 0.42% 11,198
03/31/99 0.24% 11,224
06/30/99 0.91% 11,327
09/30/99 0.54% 11,388
12/31/99 0.78% 11,477
03/31/00 0.95% 11,586
06/30/00 1.00% 11,702
09/30/00 0.76% 11,790
12/31/00 0.75% 11,879
03/31/01 0.98% 11,995
06/30/01 1.08% 12,125
09/30/01 -0.11% 12,111
12/31/01 -0.06% 12,104
03/31/02 0.23% 12,132
06/30/02 1.12% 12,268
09/30/02 0.50% 12,329
12/31/02 0.33% 12,370
03/31/03 0.99% 12,492
06/30/03 0.22% 12,520
09/30/03 0.60% 12,595
12/31/03 -0.05% 12,589
03/31/04 0.92% 12,705
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS(a)
(FOR YEARS ENDED MARCH 31, 2004)
1 YEAR 5 YEARS 10 YEARS
FBP Contrarian Equity Fund 46.60% 3.56% 11.92%
FBP Contrarian Balanced Fund 33.19% 4.85% 10.67%
Standard & Poor's 500 Index 35.12% -1.20% 11.68%
Consumer Price Index 1.70% 2.51% 2.42%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the Periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
4
FBP CONTRARIAN EQUITY FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 94.1% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 9.6%
13,000 Best Buy Company, Inc. ....................... $ 672,360
15,000 CVS Corporation .............................. 529,500
18,000 Dana Corporation ............................. 357,480
59,000 Dillard's, Inc. .............................. 1,130,440
25,300 May Department Stores Company (b) ............ 874,874
23,500 Monsanto Company ............................. 861,745
6,500 Whirlpool Corporation ........................ 447,655
----------
4,874,054
----------
CONSUMER STAPLES -- 7.5%
19,000 Altria Group, Inc. ........................... 1,034,550
40,500 Archer-Daniels-Midland Company ............... 683,235
30,000 Kroger Company (The) (a) ..................... 499,200
35,000 SUPERVALU, Inc. .............................. 1,068,900
8,500 Wal-Mart Stores, Inc. ........................ 507,365
----------
3,793,250
----------
ENERGY -- 3.4%
15,000 Kerr-McGee Corporation ....................... 772,500
28,200 Marathon Oil Corporation ..................... 949,494
----------
1,721,994
----------
FINANCIALS -- 28.1%
20,000 American Express Company ..................... 1,037,000
18,400 American International Group, Inc. ........... 1,312,840
23,000 Bank of America Corporation .................. 1,862,540
20,000 Bank One Corporation ......................... 1,090,400
31,500 Citigroup, Inc. .............................. 1,628,550
10,000 Freddie Mac .................................. 590,600
10,000 Jefferson Pilot Corporation .................. 550,100
37,000 J.P. Morgan Chase & Company .................. 1,552,150
26,000 Saint Paul Companies, Inc. ................... 1,040,260
51,500 Travelers Property Casualty Corporation - Class B 889,405
60,000 Unumprovident Corporation .................... 877,800
36,500 Wachovia Corporation ......................... 1,715,500
----------
14,147,145
----------
HEALTH CARE -- 18.1%
6,400 Anthem, Inc. (a) ............................. 580,096
33,000 Bristol-Myers Squibb Company ................. 799,590
19,700 Cardinal Health, Inc. ........................ 1,357,330
12,000 Cigna Corporation ............................ 708,240
31,300 HCA, Inc. .................................... 1,271,406
27,000 Johnson & Johnson ............................ 1,369,440
21,000 Merck & Company, Inc. ........................ 927,990
39,000 Pfizer, Inc. ................................. 1,366,950
17,000 Watson Pharmaceuticals, Inc. (a) ............. 727,430
----------
9,108,472
----------
5
FBP CONTRARIAN EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 94.1%(CONTINUED) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 11.7%
86,000 Cendant Corporation .......................... $ 2,097,540
9,200 FedEx Corporation ............................ 691,472
26,500 General Electric Company ..................... 808,780
24,000 Transocean, Inc. (a) ......................... 669,360
40,000 Tyco International Limited ................... 1,146,000
8,000 Union Pacific Corporation .................... 478,560
----------
5,891,712
----------
INFORMATION TECHNOLOGY -- 10.7%
8,000 Agilent Technologies, Inc. (a) ............... 253,040
18,000 Computer Sciences Corporation (a) ............ 725,940
10,000 Harris Corporation ........................... 484,100
60,000 Hewlett-Packard Company ...................... 1,370,400
17,500 International Business Machines Corporation (b) 1,607,200
38,000 Microsoft Corporation ........................ 948,860
----------
5,389,540
----------
MATERIALS -- 2.4%
40,000 Engelhard Corporation ........................ 1,195,600
----------
TELECOMMUNICATION SERVICES -- 2.6%
36,000 Verizon Communications, Inc. ................. 1,315,440
----------
TOTAL COMMON STOCKS (Cost $31,818,249) ....... $ 47,437,207
------------
================================================================================
PAR VALUE SHORT-TERM CORPORATE NOTES-- 5.8% VALUE
- --------------------------------------------------------------------------------
$ 55,199 American Family Financial Services
Demand Note, 0.70% .......................... $ 55,199
190,497 U.S. Bank N.A. Demand Note, 0.84% ............ 190,497
2,689,280 Wisconsin Corporate Central Credit Union
Variable Demand Note, 0.76% ................. 2,689,280
----------
TOTAL SHORT-TERM CORPORATE NOTES
(Cost $2,934,976) ........................... $ 2,934,976
----------
TOTAL INVESTMENTS AT VALUE-- 99.9%
(Cost $34,753,225) .......................... $ 50,372,183
OTHER ASSETS IN EXCESS OF LIABILTIES-- 0.1%... 27,663
----------
NET ASSETS-- 100.0% .......................... $ 50,399,846
============
(a) Non-income producing security.
(b) Security covers a call option.
See accompanying notes to financial statements.
6
FBP CONTRARIAN EQUITY FUND
SCHEDULE OF OPEN OPTION CONTRACTS
MARCH 31, 2004
================================================================================
OPTION VALUE OF PREMIUMS
CONTRACTS COVERED CALL OPTIONS OPTIONS RECEIVED
- --------------------------------------------------------------------------------
International Business Machines Corporation,
15 7/17/2004 at $100 ................... $ 1,950 $ 6,840
May Department Stores Company,
40 6/19/2004 at $32.5 .................. 12,800 10,284
-------- --------
$ 14,750 $ 17,124
======== ========
See accompanying notes to financial statements.
7
FBP CONTRARIAN BALANCED FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 69.6% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 6.7%
10,000 Best Buy Company, Inc. ....................... $ 517,200
13,500 CVS Corporation .............................. 476,550
15,000 Dana Corporation ............................. 297,900
42,000 Dillard's, Inc. .............................. 804,720
20,000 May Department Stores Company (b) ............ 691,600
17,000 Monsanto Company ............................. 623,390
1,600 Sears, Roebuck & Company ..................... 68,736
6,000 Whirlpool Corporation ........................ 413,220
----------
3,893,316
----------
CONSUMER STAPLES -- 6.0%
18,000 Altria Group, Inc. ........................... 980,100
36,000 Archer-Daniels-Midland Company ............... 607,320
20,000 Kroger Company (The) (a) ..................... 332,800
33,900 SUPERVALU, Inc. .............................. 1,035,306
9,500 Wal-Mart Stores, Inc. ........................ 567,055
----------
3,522,581
----------
ENERGY -- 2.6%
14,000 Kerr-McGee Corporation ....................... 721,000
23,000 Marathon Oil Corporation ..................... 774,410
----------
1,495,410
----------
FINANCIALS -- 21.0%
18,000 American Express Company ..................... 933,300
15,600 American International Group, Inc. ........... 1,113,060
20,000 Bank of America Corporation .................. 1,619,600
18,000 Bank One Corporation ......................... 981,360
30,000 Citigroup, Inc. .............................. 1,551,000
7,000 Freddie Mac .................................. 413,420
8,500 Jefferson Pilot Corporation .................. 467,585
34,000 J.P. Morgan Chase & Company .................. 1,426,300
24,000 Saint Paul Companies, Inc. ................... 960,240
42,000 Travelers Property Casualty Corporation - Class B 725,340
49,000 Unumprovident Corporation .................... 716,870
28,000 Wachovia Corporation ......................... 1,316,000
----------
12,224,075
----------
HEALTHCARE -- 12.9%
5,300 Anthem, Inc. (a) ............................. 480,392
17,000 Bristol-Myers Squibb Company ................. 411,910
16,300 Cardinal Health, Inc. ........................ 1,123,070
10,000 Cigna Corporation ............................ 590,200
27,500 HCA, Inc. .................................... 1,117,050
23,000 Johnson & Johnson ............................ 1,166,560
18,000 Merck & Company, Inc. ........................ 795,420
32,000 Pfizer, Inc. ................................. 1,121,600
17,000 Watson Pharmaceuticals, Inc. (a) ............. 727,430
----------
7,533,632
----------
8
FBP CONTRARIAN BALANCED FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 69.6%(CONTINUED) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 9.0%
75,000 Cendant Corporation .......................... $ 1,829,250
6,800 FedEx Corporation ............................ 511,088
26,000 General Electric Company ..................... 793,520
20,000 Transocean, Inc. (a) ......................... 557,800
39,000 Tyco International Limited ................... 1,117,350
7,000 Union Pacific Corporation .................... 418,740
----------
5,227,748
----------
INFORMATION TECHNOLOGY -- 7.5%
6,700 Agilent Technologies, Inc. (a) ............... 211,921
14,400 Computer Sciences Corporation (a) ............ 580,752
8,100 Harris Corporation ........................... 392,121
50,500 Hewlett-Packard Company ...................... 1,153,420
14,000 International Business Machines Corporation (b) 1,285,760
30,000 Microsoft Corporation ........................ 749,100
----------
4,373,074
----------
MATERIALS -- 2.0%
39,000 Engelhard Company ............................ 1,165,710
----------
TELECOMMUNICATION SERVICES -- 1.9%
31,000 Verizon Communications, Inc. ................. 1,132,740
----------
TOTAL COMMON STOCKS (Cost $24,597,227) ....... $ 40,568,286
------------
================================================================================
SHARES EXCHANGE-TRADED FUNDS -- 0.6% VALUE
- --------------------------------------------------------------------------------
6,000 iShares Russell 1000 Value Index Fund
(Cost $336,300) .............................. $ 358,080
----------
================================================================================
PAR VALUE U.S. GOVERNMENT AND AGENCY OBLIGATIONS-- 8.5% VALUE
- --------------------------------------------------------------------------------
U.S. TREASURY BILLS -- 0.9%
$ 500,000 discount, due 4/1/2004 ....................... $ 500,000
----------
U.S. TREASURY NOTES -- 6.0%
500,000 2.125%, due 10/31/2004 ...................... 503,164
1,000,000 2.00%, due 11/30/2004 ....................... 1,006,211
500,000 1.625%, due 4/30/2005 ....................... 502,402
500,000 1.50%, due 7/31/2005 ........................ 501,641
500,000 2.00%, due 8/31/2005 ........................ 504,961
500,000 1.875%, due 1/31/2006 ....................... 503,321
----------
3,521,700
----------
FEDERAL HOME LOAN BANK -- 1.6%
425,000 1.65%, due 12/30/2005 ....................... 424,889
500,000 4.14%, due 8/27/2008 ........................ 506,202
----------
931,091
----------
TOTAL U.S. GOVERNMENT AND AGENCY OBLIGATIONS
(Cost $4,947,122) ........................... $ 4,952,791
----------
9
FBP CONTRARIAN BALANCED FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE CORPORATE BONDS -- 12.7% VALUE
- --------------------------------------------------------------------------------
FINANCE -- 7.0%
Allstate Corporation,
$ 500,000 7.875%, due 5/1/2005 ......................... $ 533,723
Aon Corporation,
500,000 6.90%, due 7/1/2004 .......................... 506,345
Bankers Trust New York Corporation,
750,000 7.375%, due 5/1/2008 ......................... 869,328
CIT Group, Inc.,
500,000 5.625%, due 5/17/2004 ........................ 502,660
General Motors Acceptance Corporation,
500,000 4.15%, due 2/7/2005 .......................... 509,515
Northern Trust Company,
1,000,000 7.10%, due 8/1/2009 .......................... 1,180,935
----------
4,102,506
----------
INDUSTRIAL -- 3.9%
Berkshire Hathaway, Inc.,
500,000 9.75%, due 1/15/2018 ......................... 514,490
Raychem Corporation,
1,000,000 8.20%, due 10/15/2008 ........................ 1,145,620
Ryder System, Inc.,
560,000 6.60%, due 11/15/2005 ........................ 597,020
----------
2,257,130
----------
UTILITIES -- 1.8%
Ohio Power Company,
1,000,000 6.75%, due 7/1/2004 .......................... 1,013,145
----------
TOTAL CORPORATE BONDS (Cost $6,812,801)........ $ 7,372,781
----------
================================================================================
PAR VALUE SHORT-TERM CORPORATE NOTES-- 8.4% VALUE
- --------------------------------------------------------------------------------
$1,758,031 American Family Financial Services
Demand Note, 0.70% ........................... $ 1,758,031
2,193,845 U.S. Bank N.A. Demand Note, 0.84% ............. 2,193,845
962,829 Wisconsin Corporate Central Credit Union
Variable Demand Note, 0.76% .................. 962,829
----------
TOTAL SHORT-TERM CORPORATE NOTES
(Cost $4,914,705) ............................ $ 4,914,705
----------
TOTAL INVESTMENTS AT VALUE-- 99.8%
(Cost $41,608,155) ........................... $ 58,166,643
OTHER ASSETS IN EXCESS OF LIABILITIES-- 0.2% .. 123,455
----------
NET ASSETS-- 100.0% ........................... $ 58,290,098
----------
(a) Non-income producing security.
(b) Security covers a call option.
See accompanying notes to financial statements.
10
FBP CONTRARIAN BALANCED FUND
SCHEDULE OF OPEN OPTION CONTRACTS
MARCH 31, 2004
================================================================================
OPTION VALUE OF PREMIUMS
CONTRACTS COVERED CALL OPTIONS OPTIONS RECEIVED
- --------------------------------------------------------------------------------
International Business Machines Corporation,
15 7/17/2004 at $100 ......................... $ 1,950 $ 6,839
May Department Stores Company,
20 6/19/2004 at $32.5 ........................ 6,400 5,140
------- -------
$ 8,350 $ 11,979
======= =======
See accompanying notes to financial statements.
11
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2004
================================================================================
FBP FBP
CONTRARIAN CONTRARIAN
EQUITY BALANCED
FUND FUND
- --------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost ..................... $ 34,753,225 $ 41,608,155
============= =============
At value (Note 1) ....................... $ 50,372,183 $ 58,166,643
Dividends and interest receivable ......... 86,143 260,592
Receivable for capital shares sold ........ 2,950 1,218
Other assets .............................. 6,268 3,434
------------- -------------
TOTAL ASSETS ............................ 50,467,544 58,431,887
------------- -------------
LIABILITIES
Distributions payable ....................... 5,082 67,168
Payable for capital shares redeemed ......... -- 12,139
Accrued investment advisory fees (Note 3) ... 29,640 34,394
Accrued administration fees (Note 3) ........ 5,800 6,500
Other accrued expenses and liabilities ...... 12,426 13,238
Covered call options, at value (Notes 1 and 4)
(premiums received $17,124 and $11,979,
respectively) ............................. 14,750 8,350
------------- -------------
TOTAL LIABILITIES ......................... 67,698 141,789
------------- -------------
NET ASSETS ................................... $ 50,399,846 $ 58,290,098
============= =============
Net assets consist of:
Paid-in capital ........................... $ 36,881,690 $ 41,705,893
Undistributed net investment income ....... 1,471 22,088
Accumulated net realized losses from
security transactions ................... (2,104,647) --
Net unrealized appreciation on investments 15,621,332 16,562,117
------------- -------------
Net assets ................................... $ 50,399,846 $ 58,290,098
============= =============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) ............................ 2,026,989 3,168,552
============= =============
Net asset value, offering price and redemption
price per share (Note 1) .................. $ 24.86 $ 18.40
============= =============
See accompanying notes to financial statements.
12
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF OPERATIONS
YEAR ENDED MARCH 31, 2004
================================================================================
FBP FBP
CONTRARIAN CONTRARIAN
EQUITY BALANCED
FUND FUND
- --------------------------------------------------------------------------------
INVESTMENT INCOME
Interest .................................. $ 11,426 $ 652,758
Dividends ................................. 879,394 751,276
------------- -------------
TOTAL INVESTMENT INCOME ................. 890,820 1,404,034
------------- -------------
EXPENSES
Investment advisory fees (Note 3) ......... 317,596 370,482
Administration fees (Note 3) .............. 63,327 71,352
Professional fees ......................... 15,341 16,087
Postage and supplies ...................... 15,778 10,836
Trustees' fees and expenses ............... 12,252 12,252
Custodian fees ............................ 11,466 8,917
Registration fees ......................... 10,981 7,357
Insurance expense ......................... 4,396 4,100
Printing of shareholder reports ........... 4,661 2,893
Other expenses ............................ 7,934 14,275
------------- -------------
TOTAL EXPENSES .......................... 463,732 518,551
------------- -------------
NET INVESTMENT INCOME ........................ 427,088 885,483
------------- -------------
REALIZED AND UNREALIZED GAINS
ON INVESTMENTS
Net realized gains on security transactions 481,741 2,283,392
Net realized gains on option contracts written 31,445 25,799
Net change in unrealized appreciation/
depreciation on investments ............. 16,444,665 11,381,122
------------- -------------
NET REALIZED AND UNREALIZED GAINS
ON INVESTMENTS ............................ 16,957,851 13,690,313
------------- -------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS ........................... $ 17,384,939 $ 14,575,796
------------- -------------
See accompanying notes to financial statements.
13
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=======================================================================================================
FBP CONTRARIAN FBP CONTRARIAN
EQUITY FUND BALANCED FUND
---------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003
- -------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ................ $ 427,088 $ 580,344 $ 885,483 $ 1,089,506
Net realized gains (losses) on:
Security transactions .............. 481,741 (2,365,361) 2,283,392 (710,015)
Option contracts written ........... 31,445 100,944 25,799 70,053
Net change in unrealized appreciation/
depreciation on investments ........ 16,444,665 (15,708,256) 11,381,122 (9,024,208)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
from operations ...................... 17,384,939 (17,392,329) 14,575,796 (8,574,664)
------------ ------------ ------------ ------------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment income ........... (430,868) (580,586) (928,333) (1,128,186)
From realized capital gains on
security transactions .............. -- -- (1,622,673) --
------------ ------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders ........ (430,868) (580,586) (2,551,006) (1,128,186)
------------ ------------ ------------ ------------
FROM CAPITAL
SHARE TRANSACTIONS
Proceeds from shares sold ............ 5,760,919 19,331,027 3,896,859 3,084,060
Net asset value of shares issued in
reinvestment of distributions
to shareholders .................... 415,384 447,881 2,418,581 1,037,813
Payments for shares redeemed ......... (21,282,657) (15,910,461) (4,383,424) (2,894,644)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
from capital share transactions ...... (15,106,354) 3,868,447 1,932,016 1,227,229
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS ........................ 1,847,717 (14,104,468) 13,956,806 (8,475,621)
NET ASSETS
Beginning of year .................... 48,552,129 62,656,597 44,333,292 52,808,913
------------ ------------ ------------ ------------
End of year .......................... $ 50,399,846 $ 48,552,129 $ 58,290,098 $ 44,333,292
============ ============ ============ ============
UNDISTRIBUTED NET
INVESTMENT INCOME .................... $ 1,471 $ 5,251 $ 22,088 $ 20,407
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................. 259,761 1,001,736 219,592 199,584
Reinvested ........................... 18,252 24,745 133,936 69,712
Redeemed ............................. (1,086,855) (846,273) (251,559) (189,091)
------------ ------------ ------------ ------------
Net increase (decrease) in
shares outstanding ................. (808,842) 180,208 101,969 80,205
Shares outstanding at beginning of year 2,835,831 2,655,623 3,066,583 2,986,378
------------ ------------ ------------ ------------
Shares outstanding at end of year .... 2,026,989 2,835,831 3,168,552 3,066,583
============ ============ ============ ============
See accompanying notes to financial statements.
14
FBP CONTRARIAN EQUITY FUND
FINANCIAL HIGHLIGHTS
=========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
=========================================================================================================
YEARS ENDED MARCH 31,
--------------------------------------------------------
2004 2003 2002 2001 2000
- ---------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 17.12 $ 23.59 $ 21.78 $ 20.82 $ 22.57
-------- -------- -------- -------- --------
Income (loss) from investment operations:
Net investment income .................... 0.22 0.20 0.18 0.25 0.18
Net realized and unrealized gains (losses)
on investments ......................... 7.74 (6.47) 1.81 1.22 (1.38)
-------- -------- -------- -------- --------
Total from investment operations ............ 7.96 (6.27) 1.99 1.47 (1.20)
-------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income ..... (0.22) (0.20) (0.18) (0.25) (0.18)
Distributions from net realized gains .... -- -- -- (0.26) (0.37)
-------- -------- -------- -------- --------
Total distributions ......................... (0.22) (0.20) (0.18) (0.51) (0.55)
-------- -------- -------- -------- --------
Net asset value at end of year .............. $ 24.86 $ 17.12 $ 23.59 $ 21.78 $ 20.82
========= ========= ========= ========= =========
Total return (a) ............................ 46.60% (26.61%) 9.19% 7.17% (5.40%)
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 50,400 $ 48,552 $ 62,657 $ 54,950 $ 55,791
========= ========= ========= ========= =========
Ratio of expenses to average net assets ..... 1.02% 1.00% 0.97% 0.98% 1.04%
Ratio of net investment income to
average net assets ....................... 0.94% 1.06% 0.80% 1.18% 0.83%
Portfolio turnover rate ..................... 19% 12% 15% 26% 20%
(a) Total return is a measure of the per-share change in the total value of the
Fund, including distributions paid, from the beginning to the end of the
specified time period.
See accompanying notes to financial statements.
15
FBP CONTRARIAN BALANCED FUND
FINANCIAL HIGHLIGHTS
=========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
=========================================================================================================
YEARS ENDED MARCH 31,
--------------------------------------------------------
2004 2003 2002 2001 2000
- ---------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 14.46 $ 17.68 $ 17.26 $ 17.70 $ 19.36
-------- -------- -------- -------- --------
Income (loss) from investment operations:
Net investment income .................... 0.29 0.36 0.39 0.44 0.40
Net realized and unrealized gains (losses)
on investments ......................... 4.49 (3.21) 0.92 0.81 (0.74)
-------- -------- -------- -------- --------
Total from investment operations ............ 4.78 (2.85) 1.31 1.25 (0.34)
-------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income ..... (0.31) (0.37) (0.39) (0.44) (0.40)
Distributions from net realized gains .... (0.53) -- (0.50) (1.25) (0.92)
-------- -------- -------- -------- --------
Total distributions ......................... (0.84) (0.37) (0.89) (1.69) (1.32)
-------- -------- -------- -------- --------
Net asset value at end of year .............. $ 18.40 $ 14.46 $ 17.68 $ 17.26 $ 17.70
======== ======== ======== ======== ========
Total return (a) ............................ 33.19% (16.16%) 7.73% 7.34% (1.87%)
======== ======== ======== ======== ========
Net assets at end of year (000's) ........... $ 58,290 $ 44,333 $ 52,809 $ 50,096 $ 59,673
======== ======== ======== ======== ========
Ratio of expenses to average net assets ..... 0.98% 1.00% 0.98% 0.99% 1.02%
Ratio of net investment income to
average net assets ....................... 1.68% 2.31% 2.20%(b) 2.43% 2.11%
Portfolio turnover rate ..................... 21% 21% 20% 13% 31%
(a) Total return is a measure of the per-share change in the total value of the
Fund, including distributions paid, from the beginning to the end of the
specified time period.
(b) As required, effective April 1, 2001, the Fund adopted new provisions of
the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premiums on debt securities as adjustments to interest income.
Had the Fund not adopted these new provisions, the ratio of net investment
income to average net assets would have been 2.17% at March 31, 2002. Per
share data and ratios for periods prior to April 1, 2001 have not been
restated to reflect this change in presentation.
See accompanying notes to financial statements.
16
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The FBP Contrarian Equity Fund and the FBP Contrarian Balanced Fund (the Funds)
are no-load, diversified series of the Williamsburg Investment Trust (the
Trust), an open-end management investment company registered under the
Investment Company Act of 1940. The Trust was organized as a Massachusetts
business trust on July 18, 1988.
The FBP Contrarian Equity Fund seeks long term growth of capital through
investment in a diversified portfolio comprised primarily of equity securities,
with current income as a secondary objective.
The FBP Contrarian Balanced Fund seeks long term capital appreciation and
current income through investment in a balanced portfolio of equity and fixed
income securities assuming a moderate level of investment risk.
The following is a summary of the Funds' significant accounting policies:
Securities valuation -- The Funds' portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities which are traded over-the-counter
are valued at the last sales price, if available, otherwise, at the last quoted
bid price. Securities traded on a national stock exchange are valued based upon
the closing price on the principal exchange where the security is traded.
Securities which are quoted by NASDAQ are valued at the NASDAQ Official Closing
Price. It is expected that fixed income securities will ordinarily be traded in
the over-the-counter market, and common stocks will ordinarily be traded on a
national securities exchange, but may also be traded in the over-the-counter
market. When market quotations are not readily available, fixed income
securities may be valued on the basis of prices provided by an independent
pricing service. Call options written by the Funds are valued at the then
current market quotation, using the ask price as of the close of each day on the
principal exchanges on which they are traded. Short-term instruments (those with
remaining maturities of 60 days or less) are valued at amortized cost, which
approximates market value. Securities and other assets for which no quotations
are readily available will be valued in good faith at fair value using methods
determined by the Board of Trustees. Such methods of fair valuation may include,
but are not limited to: multiple of earnings, multiple of book value, discount
from market of a similar freely traded security, purchase price of security,
subsequent private transactions in the security or related securities, or a
combination of these and other factors.
Repurchase agreements -- The Funds may enter into joint repurchase agreements
with other funds within the Trust. The joint repurchase agreement, which is
collateralized by U.S. Government obligations, is valued at cost which, together
with accrued interest, approximates market value. At the time the Funds enter
into the joint repurchase agreement, the Funds take possession of the underlying
securities and the seller agrees that the value of the underlying securities,
including accrued interest, will at all times be equal to or exceed the face
amount of the repurchase agreement. In addition, each Fund actively monitors and
seeks additional collateral, as needed.
Share valuation -- The net asset value per share of each Fund is calculated
daily by dividing the total value of each Fund's assets, less liabilities, by
the number of shares outstanding. The offering price and redemption price per
share of each Fund is equal to the net asset value per share.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed income
securities purchased are amortized using the interest method.
Distributions to shareholders -- Dividends arising from net investment income
are declared and paid quarterly to shareholders of each Fund. Net realized
short-term capital gains, if any, may be distributed throughout the year and net
realized long-term capital gains, if any, are distributed at least once each
year. The amount of distributions from net investment income and net realized
gains are determined in accordance with federal income tax regulations which may
differ from accounting principles generally accepted in the United States.
17
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
These "book/tax" differences are either temporary or permanent in nature. The
tax character of distributions paid during the years ended March 31, 2004 and
March 31, 2003 are as follows:
- -------------------------------------------------------------------------------------------------------
Year Ordinary Long-Term Total
Ended Income Capital Gains Distributions
- -------------------------------------------------------------------------------------------------------
FBP Contrarian Equity Fund ............. 3/31/04 $ 430,868 $ -- $ 430,868
3/31/03 $ 580,586 $ -- $ 580,586
- -------------------------------------------------------------------------------------------------------
FBP Contrarian Balanced Fund ........... 3/31/04 $ 1,044,192 $ 1,506,814 $ 2,551,006
3/31/03 $ 1,128,186 $ -- $ 1,128,186
- -------------------------------------------------------------------------------------------------------
Security transactions -- Security transactions are accounted for on trade date.
Cost of securities sold is determined on a specific identification basis.
Common expenses - Common expenses of the Trust are allocated among the funds of
the Trust which may be based on relative net assets of each fund or the nature
of the services performed and the relative applicability to each fund.
Options transactions -- The Funds may write covered call options for which
premiums are received and are recorded as liabilities, and are subsequently
valued daily at the closing prices on their primary exchanges. Premiums received
from writing options which expire are treated as realized gains. Premiums
received from writing options which are exercised increase the proceeds used to
calculate the realized gain or loss on the sale of the security. If a closing
purchase transaction is used to terminate the Funds' obligation on a call, a
gain or loss will be realized, depending upon whether the price of the closing
purchase transaction is more or less than the premium previously received on the
call written.
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of income and expenses during the reporting period. Actual results could
differ from those estimates.
Federal income tax -- It is each Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which a Fund so
qualifies and distributes at least 90% of its taxable net income, the Fund (but
not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is computed on a tax basis for each item as of March
31, 2004:
- --------------------------------------------------------------------------------
FBP CONTRARIAN FBP CONTRARIAN
EQUITY FUND BALANCED FUND
- --------------------------------------------------------------------------------
Cost of portfolio investments and options $ 34,736,101 $ 41,580,021
============= =============
Gross unrealized appreciation ................ $ 16,317,948 $ 17,159,592
Gross unrealized depreciation ................ (696,616) (581,320)
------------- -------------
Net unrealized appreciation .................. $ 15,621,332 $ 16,578,272
Undistributed ordinary income ................ 6,553 33,855
Undistributed long-term gains ................ -- 39,246
Capital loss carryforwards ................... (2,104,647) --
Other temporary differences .................. (5,082) (67,168)
------------- -------------
Total distributable earnings ................. $ 13,518,156 $ 16,584,205
============= =============
- --------------------------------------------------------------------------------
18
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for the FBP Contrarian Balanced Fund is due to
certain differences in the recognition of capital gains and losses under income
tax regulations and accounting principles generally accepted in the United
States. These "book/tax" differences are either temporary or permanent in nature
and are primarily due to differing methods in the amortization of discounts and
premiums on fixed income securities.
During the year ended March 31, 2004, the FBP Contrarian Balanced Fund utilized
capital loss carryforwards of $356,837 to offset current year realized gains.
As of March 31, 2004, the FBP Contrarian Equity Fund had the following capital
loss carryforward for federal income tax purposes:
- --------------------------------------------------------------------------------
EXPIRES
AMOUNT MARCH 31,
- --------------------------------------------------------------------------------
FBP Contrarian Equity Fund $ 353,416 2010
1,392,869 2011
358,362 2012
-------------
$ 2,104,647
=============
- --------------------------------------------------------------------------------
This capital loss carryforward may be utilized in future years to offset net
realized capital gains, if any, prior to distribution to shareholders.
2. INVESTMENT TRANSACTIONS
During the year ended March 31, 2004, cost of purchases and proceeds from sales
and maturities of investment securities, other than short-term investments and
U.S. government securities, amounted to $8,309,665 and $25,732,696,
respectively, for the FBP Contrarian Equity Fund and $6,714,853 and $11,574,256,
respectively, for the FBP Contrarian Balanced Fund.
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Funds' investments are managed by Flippin, Bruce & Porter, Inc. (the
Adviser) under the terms of an Investment Advisory Agreement. Under the
Investment Advisory Agreement, each Fund pays the Adviser a fee, which is
computed and accrued daily and paid monthly, at an annual rate of .70% on its
average daily net assets up to $250 million; .65% on the next $250 million of
such net assets; and .50% on such net assets in excess of $500 million. Certain
Trustees and officers of the Trust are also officers of the Adviser.
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Funds. For these services, Ultimus receives a monthly fee from
each Fund at an annual rate of .15% on its average daily net assets up to $25
million; .125% on the next $25 million of such net assets; and .10% on such net
assets in excess of $50 million. In addition, each Fund pays out-of-pocket
expenses including, but not limited to, postage, supplies and costs of pricing
the Funds' portfolio securities. Certain officers of the Trust are also officers
of Ultimus, or of Ultimus Fund Distributors, LLC, the principal underwriter of
each Fund's shares.
19
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
4. COVERED CALL OPTIONS
A summary of covered call option contracts during the year ended March 31, 2004
is as follows:
FBP CONTRARIAN FBP CONTRARIAN
EQUITY FUND BALANCED FUND
--------------------------------------------------
OPTION OPTION OPTION OPTION
CONTRACTS PREMIUMS CONTRACTS PREMIUMS
- -------------------------------------------------------------------------------------------------
Options outstanding at beginning of year .... 100 $ 25,498 80 $ 19,851
Options written ............................. 190 77,084 185 80,017
Options exercised ........................... ( 135) ( 54,013) ( 150) ( 62,090)
Options expired ............................. ( 100) ( 31,445) ( 80) ( 25,799)
--------- --------- --------- ---------
Options outstanding at end of year .......... 55 $ 17,124 35 $ 11,979
========= ========= ========= =========
- -------------------------------------------------------------------------------------------------
5. CONTINGENCIES AND COMMITMENTS
The Funds indemnify the Trust's officers and trustees for certain liabilities
that might arise from their performance of their duties to the Funds.
Additionally, in the normal course of business the Funds enter into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Funds' maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Funds that have not yet occurred. However, based on experience, the Funds expect
the risk of loss to be remote.
20
REPORT OF INDEPENDENT AUDITORS
================================================================================
To the Board of Trustees and Shareholders of
FBP Contrarian Equity Fund and FBP Contrarian Balanced Fund
of the Williamsburg Investment Trust
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of FBP Contrarian Equity Fund and FBP Contrarian
Balanced Fund (the "Funds") (each a series of Williamsburg Investment Trust) as
of March 31, 2004, and the related statements of operations and changes in net
assets and financial highlights for the year then ended. 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. The statements of
changes in net assets and financial highlights for the respective years ended
March 31, 2003 were audited by other auditors. Those auditors expressed an
unqualified opinion on the statements of changes in net assets and financial
highlights in their report dated April 25, 2003.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of March 31, 2004, by correspondence with the custodian and brokers. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial positions of FBP
Contrarian Equity Fund and FBP Contrarian Balanced Fund as of March 31, 2004,
the results of their operations, the changes in their net assets and their
financial highlights for the year then ended, in conformity with accounting
principles generally accepted in the United States.
/s/ Ernst & Young LLP
Cincinnati, Ohio
May 6, 2004
21
BOARD OF TRUSTEES AND EXECUTIVE OFFICERS
(UNAUDITED)
================================================================================
Overall responsibility for management of the Funds rests with the Board of
Trustees. The Trustees serve during the lifetime of the Trust and until its
termination, or until death, resignation, retirement or removal. The Trustees,
in turn, elect the officers of the Funds to actively supervise its day-to-day
operations. The officers have been elected for an annual term. The following are
the Trustees and executive officers of the Funds:
POSITION HELD LENGTH OF
TRUSTEE ADDRESS AGE WITH THE TRUST TIME SERVED
- ---------------------------------------------------------------------------------------------------------------
*Charles M. Caravati, Jr. 931 Broad Street Road, 67 Chairman and Since
Manakin-Sabot, VA Trustee June 1991
- ---------------------------------------------------------------------------------------------------------------
*Austin Brockenbrough III 1802 Bayberry Court, Suite 400 67 Trustee Since
Richmond, VA September 1988
- ---------------------------------------------------------------------------------------------------------------
*John T. Bruce 800 Main Street 50 President and Since
Lynchburg, VA Trustee September 1988
- ---------------------------------------------------------------------------------------------------------------
J. Finley Lee 200 Westminster Drive 64 Trustee Since
Chapel Hill, NC September 1988
- ---------------------------------------------------------------------------------------------------------------
*Richard Mitchell 150 Government Street 54 Trustee Since
Mobile, AL June 1991
- ---------------------------------------------------------------------------------------------------------------
Richard L. Morrill University of Richmond 64 Trustee Since
Richmond, VA March 1993
- ---------------------------------------------------------------------------------------------------------------
Harris V. Morrissette 100 Jacintoport Boulevard 44 Trustee Since
Saraland, AL March 1993
- ---------------------------------------------------------------------------------------------------------------
Erwin H. Will, Jr. 47 Willway Avenue 71 Trustee Since
Richmond, VA July 1997
- ---------------------------------------------------------------------------------------------------------------
Samuel B. Witt III 2300 Clarendon Boulevard, Suite 407 68 Trustee Since
Arlington, VA November 1988
- ---------------------------------------------------------------------------------------------------------------
John P. Flippin 800 Main Street 62 Vice President Since
Lynchburg, VA September 1988
- ---------------------------------------------------------------------------------------------------------------
R. Gregory Porter III 800 Main Street 62 Vice President Since
Lynchburg, VA September 1988
- ---------------------------------------------------------------------------------------------------------------
Robert G. Dorsey 135 Merchant Street, Suite 230 47 Vice President Since
Cincinnati, OH November 2000
- ---------------------------------------------------------------------------------------------------------------
Mark J. Seger 135 Merchant Street, Suite 230 42 Treasurer Since
Cincinnati, OH November 2000
- ---------------------------------------------------------------------------------------------------------------
John F. Splain 135 Merchant Street, Suite 230 47 Secretary Since
Cincinnati, OH November 2000
- ---------------------------------------------------------------------------------------------------------------
*Messrs. Bruce, Brockenbrough, Caravati and Mitchell are "interested persons" of
the Trust within the meaning of Section 2(a)(19) of the Investment Company Act
of 1940. Charles M. Caravati, Jr. is the father of Charles M. Caravati III, an
officer of The Jamestown Funds, which are other portfolios of the Trust.
Each Trustee oversees eleven portfolios of the Trust, including the Funds. The
principal occupations of the Trustees and executive officers of the Funds during
the past five years and public directorships held by the Trustees are set forth
below:
Charles M. Caravati, Jr. is a retired physician. He is also the retired
President of Dermatology Associates of Virginia, P.C.
Austin Brockenbrough III is President and Managing Director of Lowe,
Brockenbrough & Company, Inc. (an investment advisory firm). He is a member of
the Board of Directors of Tredegar Corporation (a plastics manufacturer) and
Wilkinson O'Grady & Co., Inc. (a global asset manager). In addition, he is a
member of the Board of Trustees for the University of Richmond.
22
BOARD OF TRUSTEES AND EXECUTIVE OFFICERS
(UNAUDITED) (CONTINUED)
================================================================================
John T. Bruce is a Principal of the Adviser.
J. Finley Lee is a financial consultant and the Julian Price Professor Emeritus
at the University of North Carolina.
Richard Mitchell is a Principal of T. Leavell & Associates, Inc. (an investment
advisory firm).
Richard L. Morrill is the Chancellor of the University of Richmond. He is also a
member of the Board of Directors of Tredegar Corporation and Albemarle
Corporation (polymers and chemical manufacturer).
Harris V. Morrissette is President of Marshall Biscuit Co., Inc. He is a member
of the Board of Directors of BancTrust Financial Group, Inc. (a bank holding
company) and EnergySouth, Inc. In addition, he is Chairman of Azalea Aviation,
Inc. (an airplane fueling company).
Erwin H. Will, Jr. is the retired Managing Director of Equities of Virginia
Retirement System.
Samuel B. Witt III is Senior Vice President and General Counsel of Stateside
Associates, Inc. He is also a member of the Board of Directors of The Swiss
Helvetia Fund, Inc. (a closed-end investment company).
John M. Flippin is a Principal of the Adviser.
R. Gregory Porter III is a Principal of the Adviser.
Robert G. Dorsey is a Managing Director of Ultimus Fund Solutions, LLC and
Ultimus Fund Distributors, LLC.
Mark J. Seger is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
John F. Splain is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
Additional information about members of the Board of Trustees and executive
officers is available in the Statement of Additional Information (SAI). To
obtain a free copy of the SAI, please call 1-800-281-3217.
CHANGE IN INDEPENDENT AUDITOR (UNAUDITED)
================================================================================
On February 17, 2004, Tait, Weller & Baker was replaced as independent auditor
of the Funds, and Ernst & Young LLP (Ernst & Young) was selected as the Funds'
new independent auditor. The Funds' selection of Ernst & Young as its
independent auditor was recommended and approved by the Funds' audit committee
and was ratified by the Board of Trustees.
Tait, Weller & Baker's reports on the Funds' financial statements for the prior
two fiscal years did not contain an adverse opinion or a disclaimer of opinion,
and were not qualified or modified as to uncertainty, audit scope or accounting
principles. During such fiscal years, and through the date of Tait, Weller &
Baker's replacement, there were no disagreements between the Funds and Tait,
Weller & Baker on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedures, which disagreements, if
not resolved to the satisfaction of Tait, Weller & Baker, would have caused it
to make reference to the subject matter of the disagreements in connection with
its reports on the financial statements for such years.
FEDERAL TAX INFORMATION (UNAUDITED)
================================================================================
In accordance with federal tax requirements, the following provides shareholders
with information concerning distributions from ordinary income and net realized
gains made by the Funds during the year ended March 31, 2004. For the fiscal
year ended March 31, 2004, certain dividends paid by the Funds may be subject to
a maximum tax rate of 15%, as provided by the Jobs and Growth Tax Relief
Reconciliation Act of 2003. The FBP Contrarian Equity Fund and the FBP
Contrarian Balanced Fund intend to designate up to a maximum amount of $430,868
and $1,044,192, respectively, as taxed at a maximum rate of 15%. Additionally,
for the fiscal year ended March 31, 2004, 100% and 80% of the dividends paid
from ordinary income by the FBP Contrarian Equity Fund and the FBP Contrarian
Balanced Fund, respectively, qualified for the dividends received deduction for
corporations. As required by federal regulations, complete information will be
computed and reported in conjunction with your 2004 Form 1099-DIV.
23
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================================================================================
THE
[GRAPHIC OMITTED] FLIPPIN, BRUCE & PORTER
FUNDS
-------------------------------
INVESTMENT ADVISOR
Flippin, Bruce & Porter, Inc.
800 Main Street, Second Floor
P.O. Box 6138
Lynchburg, Virginia 24505
Toll-Free 1-800-327-9375
www.fbpinc.com
ADMINISTRATOR
Ultimus Fund Solutions, LLC
P.O. Box 46707
Cincinnati, Ohio 45246-0707
Toll-Free 1-866-738-1127
CUSTODIAN
US Bank
425 Walnut Street
Cincinnati, Ohio 45202
INDEPENDENT AUDITORS
Ernst & Young LLP
1900 Scripps Center
312 Walnut Street
Cincinnati, Ohio 45202
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
OFFICERS
John T. Bruce, President
and Portfolio Manager
John M. Flippin, Vice President
R. Gregory Porter, III,
Vice President
TRUSTEES
Austin Brockenbrough, III
John T. Bruce
Charles M. Caravati, Jr.
J. Finley Lee, Jr.
Richard Mitchell
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr.
Samuel B. Witt, III
A description of the policies and procedures that the Funds use to determine how
to vote proxies relating to portfolio securities is available without charge
upon request by calling toll-free 1-800-327-9375, or on the Securities and
Exchange Commission's website at http://www.sec.gov.
================================================================================
================================================================================
THE
JAMESTOWN
FUNDS
NO-LOAD FUNDS
THE JAMESTOWN BALANCED FUND
THE JAMESTOWN EQUITY FUND
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
THE JAMESTOWN INTERNATIONAL EQUITY FUND
ANNUAL REPORT
MARCH 31, 2004
Investment Advisor
LOWE, BROCKENBROUGH & COMPANY, INC.
RICHMOND, VIRGINIA
================================================================================
LETTER TO SHAREHOLDERS MAY 14, 2004
================================================================================
Dear Fellow Shareholders:
We are pleased to enclose for your review the audited Annual Report of The
Jamestown Funds for the fiscal year ended March 31, 2004.
THE JAMESTOWN BALANCED FUND
For the fiscal year ending March 31, 2004, The Jamestown Balanced Fund had a
return of 20.3% compared to the Lipper Balanced Fund Index of 25.1%. The Lehman
Intermediate Bond Index rose 5.3% as interest rates fell over the twelve-month
period. The S&P 500 Index enjoyed strong performance with a return of 35.1%
during the year. The equity market rebound began just before the initial stages
of the conflict in Iraq in March 2003. The economy also performed well over the
past twelve months and corporate profits were up strongly after falling for the
previous three years. Interest rates stayed low as inflation was moderate and
the Federal Reserve kept the Federal Funds rate at very low levels to allow the
economy to gather strength coming out of the recession. Investors shed their
aversion for risk, and the equity and fixed income markets were generally led
higher by lower quality securities.
The Jamestown Balanced Fund focuses on higher quality equity and fixed income
securities, and this hurt relative performance for the year. The equity portion
of the Fund focuses on large and mid-capitalization companies, which
underperformed the smaller more cyclical issues in the market place. Earnings
growth should continue to be positive in the upcoming year. However, the rate of
growth is expected to be slower. This is an environment that has historically
favored larger, higher quality equities and higher quality fixed income
investments owned by the Fund. We believe equities can deliver returns more in
line with the lower level of earnings growth that we envision over the next
year. The Federal Reserve is likely to begin raising interest rates in the near
future in response to faster economic growth and a moderate increase in
inflation. This will lead interest rates to higher levels pressuring returns
from fixed income. Accordingly, at the end of March 2004, The Jamestown Balanced
Fund had .2% in cash, 30.1% in fixed income, and 69.6% in equities. The fixed
income portion of the Fund continues to maintain a duration below that of the
Lehman Intermediate Bond Index.
In the past year, this shorter duration hurt performance of the Fund relative to
the Index as rates continued to move down. The Fund is overweighted in mortgages
and agency securities at the expense of Treasuries. The equity portion of the
Fund is overweighted in the Information Technology and Industrial sectors, as we
believe that capital spending will remain strong through the end of 2004. Our
technology holdings are a blend of more traditional, cyclical companies and more
stable service-oriented companies that are reasonably valued and less dependent
on an increase in capital spending. Industrial companies are beginning to see a
broadbased pick-up across their business lines and are beginning to see some
pricing power that has been absent since the late 1990s. We currently have no
holdings in Communication Services and Utilities as we find it difficult to
identify companies that can grow at above-average rates. Additionally, we are
underweighted in the Finance and Consumer Staples sectors.
The Jamestown Balanced Fund returned 1.2% on an annualized basis for the five
years ending March 31, 2004, compared to a return of 3.1% for the Lipper
Balanced Index. For the ten-year period, the Fund generated a return of 8.7%
versus 8.9% for the Lipper Balanced Index.
The total assets of your fund were almost $64 million as of March 31, 2004.
THE JAMESTOWN EQUITY FUND
For the fiscal year ending March 31, 2004, The Jamestown Equity Fund had a
return of 30.1% compared to 35.1% for the S&P 500 Index and 30.1% for the Lipper
Large Cap Core Index. The equity market rebound began just before the initial
stages of the conflict in Iraq in March 2003. The economy also performed well
over the past twelve months and corporate profits were up strongly after falling
for the previous three years. Interest rates stayed low as inflation was
moderate, and the Federal Reserve kept the Federal Funds rate at very low levels
to allow the economy to gather strength coming out of the recession. Investors
shed their aversion for risk, and the equity markets were generally led higher
by lower quality securities.
1
The Jamestown Equity Fund focuses on higher quality securities and this hurt
performance relative to the S&P 500 for the year. The Fund focuses on large and
mid-capitalization companies, which underperformed the smaller more cyclical
issues in the market place. Earnings growth should continue to be positive in
the upcoming year. However, the rate of growth is expected to be slower. This is
an environment that has historically favored larger, higher quality equities
owned by the Fund.
The performance of the Fund was helped by good sector selection in the past
twelve months. The primary benefit came from not owning any Communication
Services companies as this sector significantly underperformed the market. While
we were slightly overweighted in the Information Technology sector, the Fund was
hurt by stock selection primarily in this sector as the market migrated to the
most aggressive companies coming out of the economic downturn. The Fund
continues to be overweighted in the Information Technology sector. However, we
are maintaining a balance between more cyclical companies and stable,
service-oriented companies that are reasonably valued and less dependent on an
increase in capital spending. The Fund is also overweighted in Industrial
companies as they are experiencing a broadbased pick-up across their business
lines. These companies are also beginning to see some pricing power that has
been absent since the late 1990s. We currently have no holdings in Communication
Services and Utilities as we find it difficult to identify companies that can
grow at above-average rates. Additionally, we are underweighted in the Finance
and Consumer Staples sectors.
The Jamestown Equity Fund returned -1.6% on an annualized basis for the five
years ending March 31, 2004, compared to a return of -1.7% for the Lipper Large
Cap Core Index. For the ten-year period, the fund generated a return of 9.1%
versus 9.8% for the Lipper Large Cap Core Index.
The total assets of your fund were $50.2 million as of March 31, 2004.
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
For the fiscal year ended March 31, 2004, The Jamestown Tax Exempt Virginia Fund
had a total return of 3.61% compared to 4.53% for the Lipper Intermediate
Municipal Fund Index. The Lehman Municipal Bond Index rose 5.86% as interest
rates declined and the yield curve remained steep over the twelve-month period.
As of March 31, 2004, The Jamestown Tax Exempt Virginia Fund had an average
effective maturity of 5.0 years and a current yield of 2.88%, which produced a
tax equivalent yield of 4.43% (assuming a maximum 35.0% federal tax rate).
We continue to maintain a defensive posture, given our expectations for higher
interest rates. The Federal Reserve is likely to begin raising interest rates in
the near future in response to faster economic growth and a moderate increase in
inflation. The Jamestown Tax Exempt Virginia Fund continues to maintain a
duration well below that of the Lehman Municipal Bond Index. During the past
fiscal year, this shorter duration hurt the performance of the Fund relative to
the Index as interest rates continued to move lower.
The Jamestown Tax Exempt Virginia Fund returned 4.73% on an annualized basis for
the five years ended March 31, 2004, versus 5.02% for the Lipper Intermediate
Municipal Fund Index. For the ten-year period, The Jamestown Tax Exempt Virginia
Fund generated an annualized return of 5.29%, as compared to the 5.55% return
for the Lipper Intermediate Municipal Fund Index.
The total assets of The Jamestown Tax Exempt Virginia Fund were $33.6 million as
of March 31, 2004.
THE JAMESTOWN INTERNATIONAL EQUITY FUND
For the year ending March 31, 2004, The Jamestown International Equity Fund had
a return of 50.2% versus 57.5% for the EAFE Index. International equities
performed very strongly in the recovery beginning in March 2003. International
equity returns were also helped by the falling US dollar during the year.
Emerging markets delivered the best returns as investors became less risk
averse. The Morgan Stanley Emerging Markets Index was up 77.4% during the past
twelve months and the Fund's exposure helped performance. The Fund was hurt
during the year by Oechsle International Advisors' focus on investing in
growth-oriented securities, which lagged their value counterparts in the past
twelve months. International equities, in general, and growth equities in
particular, are now trading at attractive relative valuations. During the past
twelve months, the EAFE Value Index rose 66.9% and the EAFE Growth Index
increased 49.6%.
2
Global economies appear to be moving from a recovery phase to synchronized
expansion. The Japanese economy, boosted by strong export growth to China and
improving domestic demand, is experiencing the first sustainable improvements in
wages and employment in years. Oechsle has the portfolio positioned for better
global economic growth with a significant overweight in the Consumer
Discretionary sector. Consumers in the U.S. were very resilient during the
recent economic downturn. However, consumers in many international economies
pulled back on their spending levels, and Oechsle believes that there is some
pent-up demand as these consumers gain more confidence in the recovery. The Fund
has 42.2% invested in Continental Europe, 17.5% in the United Kingdom, 22.5% in
Japan, 4.9% in the Pacific Basin outside of Japan, and 10.8% in emerging
markets.
The Jamestown International Equity Fund returned -3.1% on an annualized basis
for the five years ending March 31, 2004 compared to a return of 0.5% for the
EAFE Index. Since inception (April 16, 1996), the Fund generated a return of
2.5% versus 3.5% for the EAFE Index.
The total assets of your fund were $21.2 million as of March 31, 2004.
Thank you for your continued confidence in The Jamestown Funds.
Sincerely,
/s/ Charles M. Caravati III
Charles M. Caravati, III, CFA
President
Jamestown Balanced Fund
Jamestown Equity Fund
Jamestown International Equity Fund
/s/ Beth Ann Gustafson
Beth Ann Gustafson, CFA
President
Jamestown Tax Exempt Virginia Fund
3
THE JAMESTOWN BALANCED FUND
---------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE JAMESTOWN
BALANCED FUND, THE STANDARD & POOR'S 500 INDEX AND THE CONSUMER PRICE INDEX
[GRAPHIC OMITTED]
STANDARD & POOR'S 500 INDEX: THE JAMESTOWN BALANCED FUND:
---------------------------- ----------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 -3.79% 10,000 03/31/94 -1.58% 10,000
06/30/94 0.42% 10,042 06/30/94 0.91% 10,091
09/30/94 4.88% 10,532 09/30/94 1.64% 10,256
12/31/94 -0.02% 10,530 12/31/94 -0.83% 10,171
03/31/95 9.74% 11,556 03/31/95 8.67% 11,053
06/30/95 9.55% 12,659 06/30/95 7.60% 11,893
09/30/95 7.95% 13,665 09/30/95 5.50% 12,547
12/31/95 6.02% 14,488 12/31/95 4.75% 13,143
03/31/96 5.37% 15,265 03/31/96 3.27% 13,573
06/30/96 4.49% 15,950 06/30/96 3.05% 13,987
09/30/96 3.09% 16,443 09/30/96 2.41% 14,324
12/31/96 8.34% 17,814 12/31/96 6.21% 15,214
03/31/97 2.68% 18,291 03/31/97 0.18% 15,241
06/30/97 17.46% 21,485 06/30/97 11.31% 16,965
09/30/97 7.49% 23,094 09/30/97 4.97% 17,808
12/31/97 2.87% 23,757 12/31/97 2.43% 18,241
03/31/98 13.95% 27,071 03/31/98 10.65% 20,184
06/30/98 3.30% 27,965 06/30/98 0.53% 20,290
09/30/98 -9.95% 25,183 09/30/98 -8.80% 18,505
12/31/98 21.30% 30,547 12/31/98 16.58% 21,573
03/31/99 4.98% 32,069 03/31/99 0.63% 21,709
06/30/99 7.05% 34,329 06/30/99 3.09% 22,380
09/30/99 -6.24% 32,186 09/30/99 -2.84% 21,744
12/31/99 14.88% 36,974 12/31/99 10.59% 24,047
03/31/00 2.29% 37,822 03/31/00 4.63% 25,160
06/30/00 -2.66% 36,816 06/30/00 1.38% 25,507
09/30/00 -0.97% 36,460 09/30/00 -2.92% 24,763
12/31/01 -7.81% 33,612 12/31/00 -2.06% 24,253
03/31/01 -11.86% 29,626 03/31/01 -9.38% 21,978
06/30/01 5.85% 31,360 06/30/01 1.00% 22,197
09/30/01 -14.68% 26,756 09/30/01 -9.49% 20,091
12/31/01 10.69% 29,615 12/31/01 7.10% 21,517
03/31/02 0.27% 29,696 03/31/02 -1.15% 21,270
06/30/02 -13.40% 25,717 06/30/02 -4.44% 20,325
09/30/02 -17.28% 21,273 09/30/02 -7.39% 18,823
12/31/02 8.44% 23,069 12/31/02 2.41% 19,277
03/31/03 -3.15% 22,342 03/31/03 -0.76% 19,131
06/30/03 15.39% 25,781 06/30/03 9.23% 20,896
09/30/03 2.65% 26,463 09/30/03 0.60% 21,022
12/31/03 12.18% 29,686 12/31/03 6.76% 22,443
03/31/04 1.69% 30,188 03/31/04 2.54% 23,013
CONSUMER PRICE INDEX:
---------------------
QTRLY
DATE RETURN BALANCE
---- ------ -------
03/31/94 10,000
06/30/94 0.60% 10,060
09/30/94 0.90% 10,151
12/31/94 0.60% 10,212
03/31/95 0.80% 10,294
06/30/95 0.90% 10,387
09/30/95 0.40% 10,428
12/31/95 0.50% 10,481
03/31/96 0.80% 10,565
06/30/96 1.10% 10,681
09/30/96 0.44% 10,728
12/31/96 0.82% 10,817
03/31/97 0.70% 10,892
06/30/97 0.19% 10,913
09/30/97 0.44% 10,960
12/31/97 0.62% 11,028
03/31/98 0.12% 11,042
06/30/98 0.56% 11,104
09/30/98 0.42% 11,150
12/31/98 0.42% 11,198
03/31/99 0.24% 11,224
06/30/99 0.91% 11,327
09/30/99 0.54% 11,388
12/31/99 0.78% 11,477
03/31/00 0.95% 11,586
06/30/00 1.00% 11,702
09/30/00 0.76% 11,790
12/31/00 0.75% 11,879
03/31/01 0.98% 11,995
06/30/01 1.08% 12,125
09/30/01 -0.11% 12,111
12/31/01 -0.06% 12,104
03/31/02 0.23% 12,132
06/30/02 1.12% 12,268
09/30/02 0.50% 12,329
12/31/02 0.33% 12,370
03/31/03 0.99% 12,492
06/30/03 0.22% 12,520
09/30/03 0.60% 12,595
12/31/03 -0.05% 12,589
03/31/04 0.92% 12,705
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for years ended March 31, 2004)
1 YEAR 5 YEARS 10 YEARS
The Jamestown Balanced Fund 20.29% 1.17% 8.69%
Standard & Poor's 500 Index 35.12% (1.20%) 11.68%
Consumer Price Index 1.70% 2.51% 2.42%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
4
THE JAMESTOWN EQUITY FUND
-------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE JAMESTOWN
EQUITY FUND, THE STANDARD & POOR'S 500 INDEX AND THE CONSUMER PRICE INDEX
[GRAPHIC OMITTED]
STANDARD & POOR'S 500 INDEX: THE JAMESTOWN EQUITY FUND:
---------------------------- --------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 -3.79% 10,000 03/31/94 -0.82% 10,000
06/30/94 0.42% 10,042 06/30/94 1.64% 10,164
09/30/94 4.88% 10,532 09/30/94 1.70% 10,336
12/31/94 -0.02% 10,530 12/31/94 -1.35% 10,196
03/31/95 9.74% 11,556 03/31/95 10.17% 11,233
06/30/95 9.55% 12,659 06/30/95 8.46% 12,183
09/30/95 7.95% 13,665 09/30/95 6.80% 13,011
12/31/95 6.02% 14,488 12/31/95 5.22% 13,690
03/31/96 5.37% 15,265 03/31/96 5.03% 14,378
06/30/96 4.49% 15,950 06/30/96 4.05% 14,960
09/30/96 3.09% 16,443 09/30/96 2.74% 15,371
12/31/96 8.34% 17,814 12/31/96 7.83% 16,574
03/31/97 2.68% 18,291 03/31/97 0.00% 16,574
06/30/97 17.46% 21,485 06/30/97 15.33% 19,114
09/30/97 7.49% 23,094 09/30/97 5.99% 20,259
12/31/97 2.87% 23,757 12/31/97 2.70% 20,805
03/31/98 13.95% 27,071 03/31/98 14.51% 23,823
06/30/98 3.30% 27,965 06/30/98 -0.15% 23,788
09/30/98 -9.95% 25,183 09/30/98 -14.56% 20,325
12/31/98 21.30% 30,547 12/31/98 26.90% 25,792
03/31/99 4.98% 32,069 03/31/99 0.06% 25,807
06/30/99 7.05% 34,329 06/30/99 5.45% 27,213
09/30/99 -6.24% 32,186 09/30/99 -4.62% 25,955
12/31/99 14.88% 36,974 12/31/99 15.92% 30,087
03/31/00 2.29% 37,822 03/31/00 6.39% 32,011
06/30/00 -2.66% 36,816 06/30/00 1.65% 32,540
09/30/00 -0.97% 36,460 09/30/00 -5.56% 30,731
12/31/00 -7.81% 33,612 12/31/01 -3.78% 29,571
03/31/01 -11.86% 29,626 03/31/01 -15.01% 25,131
06/30/01 5.85% 31,360 06/30/01 1.35% 25,471
09/30/01 -14.68% 26,756 09/30/01 -16.33% 21,312
12/31/01 10.69% 29,615 12/31/01 11.31% 23,723
03/31/02 0.27% 29,696 03/31/02 -1.92% 23,267
06/30/02 -13.40% 25,717 06/30/02 -8.48% 21,295
09/30/02 -17.28% 21,273 09/30/02 -14.65% 18,174
12/31/02 8.44% 23,069 12/31/02 3.25% 18,766
03/31/03 -3.15% 22,342 03/31/03 -2.22% 18,348
06/30/03 15.39% 25,781 06/30/03 13.61% 20,846
09/30/03 2.65% 26,463 09/30/03 0.79% 21,011
12/31/03 12.18% 29,686 12/31/03 10.45% 23,208
03/31/04 1.69% 30,188 03/31/04 2.86% 23,871
CONSUMER PRICE INDEX:
QTRLY
DATE RETURN BALANCE
---- ------ -------
03/31/94 10,000
06/30/94 0.60% 10,060
09/30/94 0.90% 10,151
12/31/94 0.60% 10,212
03/31/95 0.80% 10,294
06/30/95 0.90% 10,387
09/30/95 0.40% 10,428
12/31/95 0.50% 10,481
03/31/96 0.80% 10,565
06/30/96 1.10% 10,681
09/30/96 0.44% 10,728
12/31/96 0.82% 10,817
03/31/97 0.70% 10,892
06/30/97 0.19% 10,913
09/30/97 0.44% 10,960
12/31/97 0.62% 11,028
03/31/98 0.12% 11,042
06/30/98 0.56% 11,104
09/30/98 0.42% 11,150
12/31/98 0.42% 11,198
03/31/99 0.24% 11,224
06/30/99 0.91% 11,327
09/30/99 0.54% 11,388
12/31/99 0.78% 11,477
03/31/00 0.95% 11,586
06/30/00 1.00% 11,702
09/30/00 0.76% 11,790
12/31/00 0.75% 11,879
03/31/01 0.98% 11,995
06/30/01 1.08% 12,125
09/30/01 -0.11% 12,111
12/31/01 -0.06% 12,104
03/31/02 0.23% 12,132
06/30/02 1.12% 12,268
09/30/02 0.50% 12,329
12/31/02 0.33% 12,370
03/31/03 0.99% 12,492
06/30/03 0.22% 12,520
09/30/03 0.60% 12,595
12/31/04 -0.05% 12,589
03/31/04 0.92% 12,705
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for years ended March 31, 2004)
1 YEAR 5 YEARS 10 YEARS
The Jamestown Equity Fund 30.10% (1.55%) 9.09%
Standard & Poor's 500 Index 35.12% (1.20%) 11.68%
Consumer Price Index 1.70% 2.51% 2.42%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
5
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
--------------------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND, THE LIPPER INTERMEDIATE MUNICIPAL FUND INDEX
AND THE LEHMAN MUNICIPAL BOND INDEX
[GRAPHIC OMITTED]
LEHMAN MUNICIPAL BOND INDEX: THE JAMESTOWN TAX EXEMPT VIRGINIA FUND:
---------------------------- --------------------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 -5.49% 10,000 03/31/94 -4.35% 10,000
06/30/94 1.11% 10,111 06/30/94 0.79% 10,079
09/30/94 0.68% 10,180 09/30/94 0.72% 10,152
12/31/94 -1.44% 10,034 12/31/94 -0.80% 10,071
03/31/95 7.07% 10,743 03/31/95 4.73% 10,547
06/30/95 2.41% 11,002 06/30/95 2.21% 10,781
09/30/95 2.87% 11,318 09/30/95 1.98% 10,994
12/31/95 4.13% 11,785 12/31/95 2.78% 11,300
03/31/96 -1.20% 11,644 03/31/96 -0.59% 11,233
06/30/96 0.76% 11,732 06/30/96 0.63% 11,304
09/30/96 2.29% 12,001 09/30/96 1.65% 11,490
12/31/96 2.55% 12,307 12/31/96 2.15% 11,738
03/31/97 -0.24% 12,277 03/31/97 -0.10% 11,726
06/30/97 3.44% 12,700 06/30/97 2.69% 12,042
09/30/97 3.02% 13,083 09/30/97 2.12% 12,297
12/31/97 2.71% 13,438 12/31/97 2.20% 12,567
03/31/98 1.15% 13,592 03/31/98 0.78% 12,665
06/30/98 1.52% 13,799 06/30/98 1.18% 12,814
09/30/98 3.07% 14,223 09/30/98 2.95% 13,192
12/31/98 0.60% 14,308 12/31/98 0.41% 13,247
03/31/99 0.89% 14,435 03/31/99 0.32% 13,288
06/30/99 -1.77% 14,180 06/30/99 -1.54% 13,084
09/30/99 -0.40% 14,123 09/30/99 -0.06% 13,077
12/31/99 -0.78% 14,013 12/31/99 -0.46% 13,016
03/31/00 2.92% 14,422 03/31/00 2.14% 13,294
06/30/00 1.51% 14,640 06/30/00 1.11% 13,442
09/30/00 2.42% 14,994 09/30/00 2.02% 13,714
12/31/00 4.37% 15,649 12/31/00 3.44% 14,185
03/31/01 2.23% 15,998 03/31/01 2.12% 14,486
06/30/01 0.66% 16,104 06/30/01 0.47% 14,555
09/30/01 2.80% 16,555 09/30/01 2.29% 14,889
12/31/01 -0.61% 16,454 12/31/01 -0.49% 14,816
03/31/02 0.94% 16,609 03/31/02 0.77% 14,930
06/30/02 3.66% 17,216 06/30/02 3.14% 15,398
09/30/02 4.75% 18,034 09/30/02 4.15% 16,037
12/31/02 -0.07% 18,022 12/31/02 0.09% 16,051
03/31/03 1.21% 18,239 03/31/03 0.68% 16,161
06/30/03 2.57% 18,708 06/30/03 2.03% 16,489
09/30/03 0.08% 18,723 09/30/03 -0.09% 16,474
12/31/03 1.37% 18,979 12/31/03 0.66% 16,583
03/31/04 1.73% 19,308 03/31/04 0.97% 16,743
LIPPER INTERMEDIATE MUNICIPAL FUND INDEX:
----------------------------------------
QTRLY
DATE RETURN BALANCE
---- ------ -------
03/31/94 -3.89% 10,000
06/30/94 0.92% 10,092
09/30/94 0.59% 10,152
12/31/94 -1.12% 10,038
03/31/95 4.98% 10,538
06/30/95 2.25% 10,774
09/30/95 2.40% 11,033
12/31/95 2.68% 11,329
03/31/96 -0.54% 11,267
06/30/96 0.44% 11,317
09/30/96 1.83% 11,525
12/31/96 2.20% 11,779
03/31/97 -0.02% 11,776
06/30/97 2.64% 12,088
09/30/97 2.45% 12,384
12/31/97 2.16% 12,651
03/31/98 0.96% 12,772
06/30/98 1.22% 12,928
09/30/98 2.78% 13,286
12/31/98 0.57% 13,362
03/31/99 0.56% 13,436
06/30/99 -1.67% 13,211
09/30/99 0.06% 13,220
12/31/99 -0.31% 13,178
03/31/00 1.76% 13,411
6/30/2000 1.21% 13,573
09/30/00 2.09% 13,857
12/31/00 3.35% 14,321
03/31/01 2.26% 14,645
06/30/01 0.74% 14,753
09/30/01 2.59% 15,135
12/31/01 -0.84% 15,008
03/31/02 0.72% 15,116
06/30/02 3.54% 15,651
09/30/02 3.87% 16,257
12/31/02 0.02% 16,261
03/31/03 0.99% 16,421
06/30/03 2.20% 16,782
09/30/03 0.20% 16,816
12/31/03 0.91% 16,969
03/31/04 1.16% 17,166
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for years ended March 31, 2004)
1 YEAR 5 YEARS 10 YEARS
The Jamestown Tax Exempt Virginia Fund 3.61% 4.73% 5.29%
Lipper Intermediate Municipal Fund Index 4.53% 5.02% 5.55%
Lehman Municipal Bond Index 5.86% 5.99% 6.80%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
6
JAMESTOWN INTERNATIONAL EQUITY FUND
-----------------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE JAMESTOWN
INTERNATIONAL EQUITY FUND AND THE MORGAN STANLEY EUROPE, AUSTRALIA AND FAR EAST INDEX (EAFE INDEX)
[GRAPHIC OMITTED]
MORGAN STANLEY EUROPE, AUSTRALIA
AND FAR EAST INDEX (EAFE INDEX): THE JAMESTOWN INTERNATIONAL EQUITY FUND:
------------------------------ ---------------------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
04/30/96 10,000 04/16/96 10,000
06/30/96 -1.29% 9,871 06/30/96 -1.80% 9,820
09/30/96 -0.12% 9,859 09/30/96 -2.86% 9,539
12/31/96 1.59% 10,016 12/31/96 2.41% 9,769
03/31/97 -1.56% 9,860 03/31/97 0.83% 9,850
06/30/97 12.97% 11,138 06/30/97 15.80% 11,407
09/30/97 -0.71% 11,059 09/30/97 4.32% 11,899
12/31/97 -7.83% 10,193 12/31/97 -7.69% 10,984
03/31/98 14.71% 11,693 03/31/98 16.28% 12,773
06/30/98 1.06% 11,817 06/30/98 4.68% 13,370
09/30/98 -14.21% 10,138 09/30/98 -13.79% 11,527
12/31/98 20.66% 12,232 12/31/98 18.11% 13,615
03/31/99 1.39% 12,402 03/31/99 1.94% 13,879
06/30/99 2.54% 12,717 06/30/99 4.40% 14,490
09/30/99 4.40% 13,277 09/30/99 6.04% 15,366
12/31/99 16.99% 15,532 12/31/99 23.70% 19,008
03/31/00 -0.10% 15,517 03/31/00 1.75% 19,341
06/30/00 -3.96% 14,902 06/30/00 -8.58% 17,682
09/30/00 -8.06% 13,701 09/30/00 -8.12% 16,245
12/31/00 -2.69% 13,333 12/31/00 -6.88% 15,128
03/31/01 -13.74% 11,501 03/31/01 -14.72% 12,902
06/30/01 -1.05% 11,380 06/30/01 -3.22% 12,486
09/30/01 -14.00% 9,787 09/30/01 -18.06% 10,231
12/31/01 6.97% 10,469 12/31/01 7.54% 11,003
03/31/02 0.51% 10,522 03/31/02 1.24% 11,139
06/30/02 -2.12% 10,299 06/30/02 -4.45% 10,643
09/30/02 -19.74% 8,267 09/30/02 -21.45% 8,360
12/31/02 6.45% 8,800 12/31/02 5.04% 8,782
03/31/03 -8.21% 8,078 03/31/03 -10.17% 7,889
06/30/03 19.27% 9,634 06/30/03 18.86% 9,376
09/30/03 8.12% 10,417 09/30/03 6.27% 9,964
12/31/03 17.07% 12,195 12/31/03 14.38% 11,397
03/31/04 4.33% 12,723 03/31/04 3.97% 11,850
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for years ended March 31, 2004)
1 YEAR 5 YEARS SINCE INCEPTION*
The Jamestown International Equity Fund 50.22% (3.11%) 2.47%
Morgan Stanley Europe, Australia and
Far East Index (EAFE Index) 57.50% 0.51% 3.54%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
* Initial public offering of shares was April 16, 1996.
7
THE JAMESTOWN FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2004
======================================================================================================
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY VIRGINIA EQUITY
FUND FUND FUND FUND
- ------------------------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost .............. $ 52,640,965 $ 41,514,295 $ 31,145,860 $ 17,419,136
============ ============ ============ ============
At value (Note 1) ................ $ 63,774,507 $ 50,278,463 $ 33,237,052 $ 20,709,755
Cash ................................. -- -- -- 308,241
Cash denominated in
foreign currency(a) (Note 5) ..... -- -- -- 105,835
Dividends and interest receivable .... 256,667 20,463 426,267 68,673
Receivable for capital shares sold ... 1,155 20,833 -- 3,090
Other assets ......................... 7,894 8,249 917 7,794
------------ ------------ ------------ ------------
TOTAL ASSETS ..................... 64,040,223 50,328,008 33,664,236 21,203,388
------------ ------------ ------------ ------------
LIABILITIES
Distributions payable ................ 119,617 86,733 28,052 --
Payable for securities purchased ..... -- -- -- 3,835
Payable for capital shares redeemed .. 26,262 21,313 19,385 735
Accrued investment advisory fees (Note 3) 35,217 27,406 10,109 10,133
Accrued administration fees (Note 3) . 7,000 5,800 4,100 3,800
Other accrued expenses ............... 14,522 -- 488 26,530
------------ ------------ ------------ ------------
TOTAL LIABILITIES ................ 202,618 141,252 62,134 45,033
------------ ------------ ------------ ------------
NET ASSETS .............................. $ 63,837,605 $ 50,186,756 $ 33,602,102 $ 21,158,355
============ ============ ============ ============
Net assets consist of:
Paid-in capital ...................... $ 52,892,795 $ 41,444,238 $ 31,579,137 $ 37,683,315
Undistributed (overdistributed) net
investment income ................ (83,209) -- 11,446 18,572
Accumulated net realized losses
from security transactions ....... (105,523) (21,650) (79,673) (19,835,547)
Net unrealized appreciation
on investments ................... 11,133,542 8,764,168 2,091,192 3,290,619
Net unrealized appreciation on
translation of assets and liabilities
in foreign currencies ........... -- -- -- 1,396
------------ ------------ ------------ ------------
Net assets .............................. $ 63,837,605 $ 50,186,756 $ 33,602,102 $ 21,158,355
============ ============ ============ ============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) ....................... 4,144,799 2,745,458 3,180,467 2,246,784
============ ============ ============ ============
Net asset value, offering price and redemption
price per share(b) ................... $ 15.40 $ 18.28 $ 10.57 $ 9.42
============ ============ ============ ============
(a) For Jamestown International Equity Fund, the cost of cash denominated in
foreign currency is $105,381.
(b) For Jamestown International Equity Fund, redemption price varies based on
length of time held (Note 1).
See accompanying notes to financial statements.
8
THE JAMESTOWN FUNDS
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 2004
=======================================================================================================
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY VIRGINIA EQUITY
FUND FUND FUND FUND
- -------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends ............................ $ 480,894 $ 514,334 $ -- $ 543,015
Foreign withholding taxes on dividends -- -- -- (83,088)
Interest ............................. 1,238,533 17,407 1,458,286 --
------------ ------------ ------------ ------------
TOTAL INVESTMENT INCOME .......... 1,719,427 531,741 1,458,286 459,927
------------ ------------ ------------ ------------
EXPENSES
Investment advisory fees (Note 3) .... 422,603 299,071 140,809 235,422
Administration fees (Note 3) ......... 83,866 63,862 50,230 47,172
Custodian fees ....................... 10,261 8,626 7,366 60,345
Professional fees .................... 17,337 15,241 13,141 18,978
Trustees' fees and expenses .......... 12,252 12,252 12,252 12,252
Registration fees .................... 14,336 13,784 1,708 12,863
Pricing costs ........................ 8,488 1,552 5,857 15,625
Postage and supplies ................. 6,597 6,827 6,073 4,627
Insurance expense .................... 5,681 3,728 3,568 2,224
Printing of shareholder reports ...... 2,245 3,184 1,261 1,754
Other expenses ....................... 8,187 5,994 18,231 4,765
------------ ------------ ------------ ------------
TOTAL EXPENSES ................... 591,853 434,121 260,496 416,027
Fees waived by the Adviser (Note 3) .. -- -- (17,601) (91,144)
Expenses reimbursed through a directed
brokerage arrangement (Note 4) ... (24,000) (28,000) -- --
------------ ------------ ------------ ------------
NET EXPENSES ..................... 567,853 406,121 242,895 324,883
------------ ------------ ------------ ------------
NET INVESTMENT INCOME ................... 1,151,574 125,620 1,215,391 135,044
------------ ------------ ------------ ------------
REALIZED AND UNREALIZED
GAINS (LOSSES) ON INVESTMENTS
AND FOREIGN CURRENCIES (Note 5)
Net realized gains from:
Security transactions ............ 4,199,003 2,588,909 141,046 1,481,570
Foreign currency transactions .... -- -- -- 22,537
Net change in unrealized appreciation/
depreciation on:
Investments ...................... 6,717,187 8,914,790 (95,839) 7,758,606
Foreign currency translation ..... -- -- -- (5,493)
------------ ------------ ------------ ------------
NET REALIZED AND UNREALIZED
GAINS ON INVESTMENTS
AND FOREIGN CURRENCIES ............... 10,916,190 11,503,699 45,207 9,257,220
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS ...................... $ 12,067,764 $ 11,629,319 $ 1,260,598 $ 9,392,264
============ ============ ============ ============
See accompanying notes to financial statements.
9
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=======================================================================================================
JAMESTOWN JAMESTOWN
BALANCED FUND EQUITY FUND
-------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003
- -------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ................ $ 1,151,574 $ 1,661,002 $ 125,620 $ 109,954
Net realized gains (losses) on
security transactions ............ 4,199,003 (671,793) 2,588,909 (1,201,020)
Net change in unrealized appreciation/
depreciation on investments ...... 6,717,187 (10,418,304) 8,914,790 (10,210,917)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
from operations ...................... 12,067,764 (9,429,095) 11,629,319 (11,301,983)
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ........... (1,223,055) (1,721,820) (127,664) (109,812)
From net realized gains from
security transactions ............ (3,352,848) -- (1,325,502) --
------------ ------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders ........ (4,575,903) (1,721,820) (1,453,166) (109,812)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ............ 3,140,462 4,755,793 4,251,916 3,042,443
Net asset value of shares issued in
reinvestment of distributions to
shareholders ..................... 4,290,910 1,593,060 1,353,892 100,905
Payments for shares redeemed ......... (16,424,954) (26,682,823) (4,214,310) (7,919,618)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets from
capital share transactions ........... (8,993,582) (20,333,970) 1,391,498 (4,776,270)
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS ........................ (1,501,721) (31,484,885) 11,567,651 (16,188,065)
NET ASSETS
Beginning of year .................... 65,339,326 96,824,211 38,619,105 54,807,170
------------ ------------ ------------ ------------
End of year .......................... $ 63,837,605 $ 65,339,326 $ 50,186,756 $ 38,619,105
============ ============ ============ ============
UNDISTRIBUTED (OVERDISTRIBUTED)
NET INVESTMENT INCOME ................ $ (83,209) $ (165,113) $ -- $ 2,044
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................. 208,358 338,173 246,616 200,878
Reinvested ........................... 282,740 113,232 74,222 6,884
Redeemed ............................. (1,093,653) (1,885,393) (244,294) (517,825)
------------ ------------ ------------ ------------
Net increase (decrease) in shares
outstanding ......................... (602,555) (1,433,988) 76,544 (310,063)
Shares outstanding, beginning of year 4,747,354 6,181,342 2,668,914 2,978,977
------------ ------------ ------------ ------------
Shares outstanding, end of year ...... 4,144,799 4,747,354 2,745,458 2,668,914
============ ============ ============ ============
See accompanying notes to financial statements.
10
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=======================================================================================================
JAMESTOWN TAX EXEMPT JAMESTOWN
VIRGINIA FUND INTERNATIONAL EQUITY FUND
-------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003
- -------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ................ $ 1,215,391 $ 1,350,310 $ 135,044 $ 188,785
Net realized gains (losses) from:
Security transactions ............ 141,046 (7,053) 1,481,570 (7,146,038)
Foreign currency transactions .... -- -- 22,537 (10,037)
Net change in unrealized appreciation/
depreciation on:
Investments ...................... (95,839) 1,510,441 7,758,606 (4,190,992)
Foreign currency translation ..... -- -- (5,493) 6,942
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
from operations ...................... 1,260,598 2,853,698 9,392,264 (11,151,340)
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ........... (1,211,959) (1,349,803) (128,007) (167,663)
From net realized gains from foreign
currency transactions ............ -- -- (22,537) --
------------ ------------ ------------ ------------
Net decrease in net assets from distributions
to shareholders ...................... (1,211,959) (1,349,803) (150,544) (167,663)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ............ 4,145,836 5,125,030 1,190,078 4,946,712
Net asset value of shares issued in
reinvestment of distributions to
shareholders ....................... 856,576 949,605 146,131 163,658
Proceeds from redemption fees collected . -- -- 400 40,984
Payments for shares redeemed ............ (7,872,504) (5,051,117) (10,728,264) (16,545,962)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets from
capital share transactions ........... (2,870,092) 1,023,518 (9,391,655) (11,394,608)
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE) IN
NET ASSETS ........................... (2,821,453) 2,527,413 (149,935) (22,713,611)
NET ASSETS
Beginning of year .................... 36,423,555 33,896,142 21,308,290 44,021,901
------------ ------------ ------------ ------------
End of year .......................... $ 33,602,102 $ 36,423,555 $ 21,158,355 $ 21,308,290
============ ============ ============ ============
UNDISTRIBUTED NET
INVESTMENT INCOME .................... $ 11,446 $ 19,091 $ 18,572 $ 11,085
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................. 394,610 491,355 139,029 652,404
Reinvested ........................... 81,178 90,745 16,552 25,936
Redeemed ............................. (743,152) (483,184) (1,287,783) (2,204,031)
------------ ------------ ------------ ------------
Net increase (decrease) in shares outstanding (267,364) 98,916 (1,132,202) (1,525,691)
Shares outstanding, beginning of year ... 3,447,831 3,348,915 3,378,986 4,904,677
------------ ------------ ------------ ------------
Shares outstanding, end of year ......... 3,180,467 3,447,831 2,246,784 3,378,986
============ ============ ============ ============
See accompanying notes to financial statements.
11
THE JAMESTOWN BALANCED FUND
FINANCIAL HIGHLIGHTS
=========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
=========================================================================================================
YEARS ENDED MARCH 31,
---------------------------------------------------------
2004 2003 2002(a) 2001 2000
- ---------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 13.76 $ 15.66 $ 16.78 $ 19.83 $ 18.12
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income ....................... 0.27 0.31 0.32 0.35 0.35
Net realized and unrealized gains
(losses) on investments ..................... 2.48 (1.88) (0.86) (2.82) 2.49
--------- --------- --------- --------- ---------
Total from investment operations ............ 2.75 (1.57) (0.54) (2.47) 2.84
--------- --------- --------- --------- ---------
Less distributions:
Dividends from net investment income ........ (0.29) (0.33) (0.35) (0.35) (0.35)
Distributions from net realized gains ....... (0.82) -- (0.23) (0.23) (0.78)
--------- --------- --------- --------- ---------
Total distributions ......................... (1.11) (0.33) (0.58) (0.58) (1.13)
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 15.40 $ 13.76 $ 15.66 $ 16.78 $ 19.83
========= ========= ========= ========= =========
Total return(b) ............................. 20.29% (10.06%) (3.22%) (12.65%) 15.90%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 63,838 $ 65,339 $ 96,824 $ 109,333 $ 128,201
========= ========= ========= ========= =========
Ratio of gross expenses to average net assets 0.91% 0.90% 0.86% 0.87% 0.88%
Ratio of net expenses to average net assets(c) 0.88% 0.87% 0.83% 0.85% 0.86%
Ratio of net investment income to
average net assets .......................... 1.77% 2.12% 1.97% 1.84% 1.85%
Portfolio turnover rate ..................... 36% 38% 62% 64% 62%
(a) As required, effective April 1, 2001, the Fund adopted new provisions of
the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premiums on debt securities and began recording paydown gains
and losses as adjustments to interest income. Had the Fund not adopted
these new provisions, the net investment income per share would have been
$0.34 and the ratio of net investment income to average net assets would
have been 2.07%. Per share data and ratios for periods prior to April 1,
2001 have not been restated to reflect this change in presentation.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
(c) Ratios were determined based on net expenses after expense reimbursements
through a directed brokerage arrangement (Note 4).
See accompanying notes to financial statements.
12
THE JAMESTOWN EQUITY FUND
FINANCIAL HIGHLIGHTS
=========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
=========================================================================================================
YEARS ENDED MARCH 31,
---------------------------------------------------------
2004 2003 2002 2001 2000
- ---------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 14.47 $ 18.40 $ 19.94 $ 26.02 $ 21.76
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income (loss) ................ 0.05 0.04 0.06 (0.00) 0.03
Net realized and unrealized gains
(losses) on investments ..................... 4.30 (3.93) (1.54) (5.51) 5.18
--------- --------- --------- --------- ---------
Total from investment operations ............ 4.35 (3.89) (1.48) (5.51) 5.21
--------- --------- --------- --------- ---------
Less distributions:
Dividends from net investment income ........ (0.05) (0.04) (0.06) -- (0.03)
Distributions from net realized gains ....... (0.49) -- -- (0.57) (0.92)
--------- --------- --------- --------- ---------
Total distributions ......................... (0.54) (0.04) (0.06) (0.57) (0.95)
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 18.28 $ 14.47 $ 18.40 $ 19.94 $ 26.02
========= ========= ========= ========= =========
Total return(a) ............................. 30.10% (21.15%) (7.42%) (21.49%) 24.04%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 50,187 $ 38,619 $ 54,807 $ 60,914 $ 77,809
========= ========= ========= ========= =========
Ratio of gross expenses to average net assets 0.94% 0.96% 0.90% 0.90% 0.91%
Ratio of net expenses to average net assets(b) 0.88% 0.89% 0.86% 0.88% 0.88%
Ratio of net investment income
(loss) to average net assets ................ 0.27% 0.25% 0.31% (0.01%) 0.14%
Portfolio turnover rate ..................... 52% 60% 89% 83% 67%
(a) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
(b) Ratios were determined based on net expenses after expense reimbursements
through a directed brokerage arrangement (Note 4).
See accompanying notes to financial statements.
13
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
FINANCIAL HIGHLIGHTS
=========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
=========================================================================================================
YEARS ENDED MARCH 31,
---------------------------------------------------------
2004 2003 2002(a) 2001 2000
- ---------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 10.56 $ 10.12 $ 10.22 $ 9.79 $ 10.22
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income ....................... 0.37 0.38 0.41 0.43 0.42
Net realized and unrealized gains
(losses) on investments ..................... 0.00(b) 0.44 (0.10) 0.43 (0.42)
--------- --------- --------- --------- ---------
Total from investment operations ............ 0.37 0.82 0.31 0.86 0.00
--------- --------- --------- --------- ---------
Less distributions:
Dividends from net investment income ........ (0.36) (0.38) (0.41) (0.43) (0.42)
Distributions from net realized gains ....... -- -- -- -- (0.01)
--------- --------- --------- --------- ---------
Total distributions ......................... (0.36) (0.38) (0.41) (0.43) (0.43)
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 10.57 $ 10.56 $ 10.12 $ 10.22 $ 9.79
========= ========= ========= ========= =========
Total return(c) ............................. 3.61% 8.24% 3.04% 8.97% 0.04%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 33,602 $ 36,424 $ 33,896 $ 30,182 $ 29,138
========= ========= ========= ========= =========
Ratio of net expenses to average net
assets(d) ................................... 0.69% 0.69% 0.68% 0.68% 0.69%
Ratio of net investment income to
average net assets .......................... 3.46% 3.68% 4.02% 4.31% 4.27%
Portfolio turnover rate ..................... 43% 28% 27% 47% 47%
(a) As required, effective April 1, 2001, the Fund adopted new provisions of
the AICPA Audit and Accounting Guide for Investment Companies and began
accreting market discount on debt securities. Had the Fund not adopted this
new provision, the ratio of net investment income to average net assets
would have been 3.98%. Per share data and ratios for periods prior to April
1, 2001 have not been restated to reflect this change in presentation.
(b) Represents less than a penny per share.
(c) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
(d) Absent investment advisory fees voluntarily waived by the Adviser, the
ratio of expenses to average net assets would have been 0.74% and 0.70% for
the years ended March 31, 2004 and 2003, respectively.
See accompanying notes to financial statements.
14
THE JAMESTOWN INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
=========================================================================================================
YEARS ENDED MARCH 31,
---------------------------------------------------------
2004 2003 2002 2001 2000
- ---------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 6.31 $ 8.98 $ 10.56 $ 17.99 $ 13.63
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income (loss) ................ 0.05 0.06 0.01 (0.03) (0.00)
Net realized and unrealized gains (losses)
on investments and foreign currencies ....... 3.12 (2.69) (1.47) (5.48) 5.19
--------- --------- --------- --------- ---------
Total from investment operations ............ 3.17 (2.63) (1.46) (5.51) 5.19
--------- --------- --------- --------- ---------
Less distributions:
Dividends from net investment income ........ (0.05) (0.05) (0.05) (0.05) (0.04)
Return of capital ........................... -- -- (0.08) -- --
Distributions from net realized gains ....... (0.01) -- -- (1.87) (0.79)
--------- --------- --------- --------- ---------
Total distributions ......................... (0.06) (0.05) (0.13) (1.92) (0.83)
--------- --------- --------- --------- ---------
Proceeds from redemption fees collected ..... 0.00 0.01 0.01 -- --
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 9.42 $ 6.31 $ 8.98 $ 10.56 $ 17.99
========= ========= ========= ========= =========
Total return(a) ............................. 50.22% ( 29.18% ) ( 13.66% ) (33.29%) 39.35%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 21,158 $ 21,308 $ 44,022 $ 59,664 $ 85,849
========= ========= ========= ========= =========
Ratio of net expenses to average net assets(b) 1.38% 1.38% 1.38% 1.41% 1.56%
Ratio of net investment income (loss)
to average net assets ....................... 0.57% 0.60% 0.12% (0.24%) (0.01%)
Portfolio turnover rate ..................... 78% 56% 80% 48% 52%
(a) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
(b) Absent investment advisory fees voluntarily waived by the Adviser, the
ratio of expenses to average net assets would have been 1.77%, 1.70% and
1.51% for the years ended March 31, 2004, 2003 and 2002, respectively.
See accompanying notes to financial statements.
15
THE JAMESTOWN BALANCED FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 69.6% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 9.8%
12,000 Gannett Company, Inc. ........................ $ 1,057,680
20,000 Home Depot, Inc. ............................. 747,200
44,000 Mattel, Inc. ................................. 811,360
36,000 Staples, Inc. ................................ 914,040
22,800 Target Corporation ........................... 1,026,912
22,000 Viacom, Inc. - Class B ....................... 862,620
14,000 Wal-Mart Stores, Inc. ........................ 835,660
------------
6,255,472
------------
CONSUMER STAPLES -- 4.2%
8,000 Hershey Foods Corporation .................... 662,800
27,000 PepsiCo, Inc. ................................ 1,453,950
14,000 SYSCO Corporation ............................ 546,700
------------
2,663,450
------------
ENERGY -- 4.4%
21,000 Anadarko Petroleum Corporation ............... 1,089,060
10,100 ChevronTexaco Corporation .................... 886,578
21,000 Noble Drilling Corporation (a) ............... 806,820
------------
2,782,458
------------
FINANCIALS -- 12.2%
16,000 American International Group, Inc. ........... 1,141,600
16,000 Bank of America Corporation .................. 1,295,680
28,000 Citigroup, Inc. .............................. 1,447,600
7,000 Fannie Mae ................................... 520,450
9,700 Goldman Sachs Group, Inc. (The) .............. 1,012,195
16,500 J.P. Morgan Chase & Company .................. 692,175
27,000 Principal Financial Group, Inc. .............. 962,010
16,000 Prudential Financial, Inc. ................... 716,480
------------
7,788,190
------------
HEALTHCARE -- 10.1%
17,000 Amgen, Inc. (a) .............................. 988,890
17,000 Anthem, Inc. (a) ............................. 1,540,880
11,500 Johnson & Johnson ............................ 583,280
10,000 Medtronic, Inc. .............................. 477,500
43,000 Pfizer, Inc. ................................. 1,507,150
14,000 Teva Pharmaceutical Industries Ltd. .......... 887,740
5,500 Varian Medical Systems, Inc. (a) ............. 474,705
------------
6,460,145
------------
INDUSTRIALS -- 11.9%
8,400 3M Company ................................... 687,708
40,000 Cendant Corporation .......................... 975,600
17,350 Dover Corporation ............................ 672,659
21,000 First Data Corporation ....................... 885,360
7,000 General Dynamics Corporation ................. 625,310
13,300 General Electric Company ..................... 405,916
15,000 Illinois Tool Works, Inc. .................... 1,188,450
15,400 ITT Industries, Inc. ......................... 1,175,482
44,000 Norfolk Southern Corporation ................. 971,960
------------
7,588,445
------------
16
THE JAMESTOWN BALANCED FUND
PORTFOLIO OF INVESTMENTS (Continued)
================================================================================
SHARES COMMON STOCKS -- 69.6% (Continued) VALUE
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY -- 14.5%
37,000 Accenture Ltd. - Class A (a) ................. $ 917,600
24,700 Affiliated Computer Services, Inc. (a) ....... 1,281,930
13,400 Analog Devices, Inc. ......................... 643,334
28,700 Cisco Systems, Inc.(a) ....................... 675,024
25,500 Dell Computer Corporation (a) ................ 857,310
37,100 Intel Corporation ............................ 1,009,120
15,000 Intuit, Inc.(a) .............................. 673,200
8,000 Lexmark International, Inc.(a) ............... 736,000
47,000 Microsoft Corporation ........................ 1,173,590
50,000 Oracle Corporation (a) ....................... 600,500
10,500 Qualcomm, Inc. ............................... 697,410
------------
9,265,018
------------
MATERIALS -- 2.5%
25,000 Praxair, Inc. ................................ 928,000
14,500 Vulcan Materials Company ..................... 687,880
------------
1,615,880
------------
TOTAL COMMON STOCKS (Cost $34,905,694) ....... $ 44,419,058
------------
================================================================================
PAR
VALUE U.S. TREASURY OBLIGATIONS -- 2.2% VALUE
- --------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 1.8%
$1,000,000 7.00%, due 07/15/2006 ........................ $ 1,118,594
------------
U.S. TREASURY INFLATION-PROTECTION NOTES-- 0.4%
239,594 3.375%, due 01/15/2007 ....................... 264,049
------------
TOTAL U.S. TREASURY OBLIGATIONS (Cost $1,258,629) $ 1,382,643
------------
================================================================================
PAR
VALUE U.S. GOVERNMENT AGENCY OBLIGATIONS-- 6.0% VALUE
- --------------------------------------------------------------------------------
FEDERAL HOME LOAN BANK -- 0.4%
$ 250,000 4.125%, due 01/14/2005 ....................... $ 255,890
------------
FEDERAL HOME LOAN MORTGAGE CORPORATION-- 2.3%
1,000,000 6.625%, due 09/15/2009 ....................... 1,165,542
300,000 5.125%, due 07/15/2012 ....................... 323,105
------------
1,488,647
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION-- 3.3%
800,000 7.00%, due 07/15/2005 ........................ 858,278
200,000 2.00%, due 10/21/2005 ........................ 200,870
700,000 6.00%, due 12/15/2005 ........................ 752,263
250,000 7.25%, due 01/15/2010 ........................ 300,554
------------
2,111,965
------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $3,505,158) .......................... $ 3,856,502
------------
17
THE JAMESTOWN BALANCED FUND
PORTFOLIO OF INVESTMENTS (Continued)
================================================================================
PAR
VALUE MORTGAGE-BACKED SECURITIES -- 4.0% VALUE
- --------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION-- 1.3%
$ 153,063 Pool #1471, 7.00%, due 03/01/2008 ............ $ 160,600
113,238 Pool #1655, 6.50%, due 10/01/2008 ............ 116,415
239,026 Pool #E00616, 6.00%, due 01/01/2014 .......... 251,876
84,081 Pool #E90624, 6.00%, due 08/01/2017 .......... 88,601
207,676 Pool #E91957, 5.00%, due 10/01/2017 .......... 213,793
------------
831,285
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 1.7%
114,110 Series #93-18-PJ, 6.50%, due 12/01/2007 ...... 117,369
758,848 Pool #380512, 6.15%, due 08/01/2008 (b) ...... 834,733
139,411 Pool #489757, 6.00%, due 04/01/2029 .......... 145,159
------------
1,097,261
------------
GOVERNMENT NATIONAL MORTAGE ASSOCIATION -- 1.0%
121,071 Pool #781344, 6.50%, due 10/01/2031 .......... 127,823
479,748 Series #2003-102, 4.25%, due 11/01/2033 ...... 486,350
------------
614,173
------------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $2,412,699) ........................... $ 2,542,719
------------
================================================================================
PAR
VALUE CORPORATE BONDS -- 17.1% VALUE
- --------------------------------------------------------------------------------
Alcoa, Inc.,
$ 250,000 6.50%, due 06/01/2011 ........................ $ 287,861
Allstate Corporation,
150,000 6.125%, due 02/15/2012 ....................... 168,119
American Home Products Corporation,
500,000 7.90%, due 02/15/2005 ........................ 526,789
Anheuser-Busch Companies, Inc.,
249,000 5.375%, due 09/15/2008 ....................... 271,374
BB&T Corporation,
325,000 6.50%, due 08/01/2011 ........................ 374,466
Boeing Capital Corporation,
300,000 7.10%, due 09/27/2005 ........................ 323,145
Burlington Resources, Inc.,
350,000 6.68%, due 02/15/2011 ........................ 399,979
Cardinal Health, Inc.,
265,000 6.25%, due 07/15/2008 ........................ 296,496
Citigroup, Inc.,
200,000 5.00%, due 03/06/2007 ........................ 214,612
Conoco, Inc.,
250,000 5.90%, due 04/15/2004 ........................ 250,325
CVS Corporation,
250,000 5.625%, due 03/15/2006 ....................... 267,402
Deutsche Telekom AG,
300,000 8.50%, due 06/15/2010 ........................ 368,311
Donaldson, Lufkin & Jenrette, Inc.,
500,000 6.875%, due 11/01/2005 ....................... 541,080
18
THE JAMESTOWN BALANCED FUND
PORTFOLIO OF INVESTMENTS (Continued)
================================================================================
PAR
VALUE CORPORATE BONDS -- 17.1% (COntinued) VALUE
- --------------------------------------------------------------------------------
Dover Corporation,
$ 345,000 6.50%, due 02/15/2011 ........................ $ 397,023
Duke Realty L.P., Medium Term Notes,
390,000 6.75%, due 05/30/2008 ........................ 444,937
FPL Group Capital, Inc.,
300,000 7.375%, due 06/01/2009 ....................... 353,903
General Dynamics Corporation,
125,000 4.25%, due 05/15/2013 ........................ 123,139
General Motors Corporation,
500,000 6.125%, due 08/28/2007 ....................... 538,859
Goldman Sachs Group, Inc.,
350,000 6.65%, due 05/15/2009 ........................ 401,629
GTE Northwest, Inc.,
300,000 6.30%, due 06/01/2010 ........................ 335,469
Household Finance Corporation,
300,000 6.40%, due 06/17/2008 ........................ 337,478
Illinois Tool Works, Inc.,
216,000 5.75%, due 03/01/2009 ........................ 241,127
J.P. Morgan Chase & Company,
300,000 6.75%, due 02/01/2011 ........................ 349,822
Marsh & McClennan Companies, Inc.,
309,000 6.625%, due 06/15/2004 ....................... 312,197
May Department Stores Company,
260,000 5.95%, due 11/01/2008 ........................ 286,372
Morgan Stanley Dean Witter & Company,
350,000 6.75%, due 04/15/2011 ........................ 404,289
National City Corporation,
575,000 7.20%, due 05/15/2005 ........................ 611,438
PepsiCo, Inc.,
125,000 4.50%, due 09/15/2004 ........................ 126,797
Pharmacia Corporation,
250,000 5.75%, due 12/01/2005 ........................ 266,616
SBC Communciations, Inc., Medium Term Notes,
400,000 6.875%, due 08/15/2006 ....................... 441,524
SunTrust Banks, Inc.
300,000 6.00%, due 01/15/2028 ........................ 332,859
Union Camp Corporation,
300,000 6.50%, due 11/15/2007 ........................ 335,126
------------
TOTAL CORPORATE BONDS (Cost $9,959,039) ....... $ 10,930,563
------------
19
THE JAMESTOWN BALANCED FUND
PORTFOLIO OF INVESTMENTS (Continued)
================================================================================
PAR
VALUE MUNICIPAL DEBT SECURITIES -- 0.4% VALUE
- --------------------------------------------------------------------------------
$ 230,000 Virginia State Residential Authority,
Infrastructure, Revenue,
5.90%, due 05/01/2011 (Cost $234,169)......... $ 255,677
------------
================================================================================
PAR
VALUE REGIONAL AUTHORITY BONDS -- 0.4% VALUE
- --------------------------------------------------------------------------------
$ 205,000 Manitoba (Province of), Medium Term Notes,
5.50%, due 10/01/2008 (Cost $204,325) ........ $ 226,093
------------
================================================================================
PAR
VALUE SHORT-TERM CORPORATE NOTES-- 0.2% VALUE
- --------------------------------------------------------------------------------
$ 161,252 U.S. Bank N.A. Demand Note, 0.84%,
floating rate (Cost $161,252) ................ $ 161,252
------------
TOTAL INVESTMENTS AT VALUE-- 99.9%
(Cost $52,640,965) ........................... $ 63,774,507
OTHER ASSETS IN EXCESS OF LIABILITIES-- 0.1% .. 63,098
------------
NET ASSETS-- 100.0% ........................... $ 63,837,605
============
(a) Non-income producing security.
(b) Fair valued security.
See accompanying notes to financial statements.
20
THE JAMESTOWN EQUITY FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 99.9% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 13.9%
13,300 Gannett Company, Inc. ........................ $1,172,262
22,000 Home Depot, Inc. ............................. 821,920
50,000 Mattel, Inc. ................................. 922,000
42,000 Staples, Inc. ................................ 1,066,380
25,200 Target Corporation ........................... 1,135,008
24,000 Viacom, Inc. - Class B ....................... 941,040
15,400 Wal-Mart Stores, Inc. ........................ 919,226
------------
6,977,836
------------
CONSUMER STAPLES -- 6.0%
9,000 Hershey Foods Corporation .................... 745,650
31,500 PepsiCo, Inc. ................................ 1,696,275
14,000 SYSCO Corporation ............................ 546,700
------------
2,988,625
------------
ENERGY -- 6.5%
24,000 Anadarko Petroleum Corporation ............... 1,244,640
11,300 ChevronTexaco Corporation .................... 991,914
26,000 Noble Drilling Corporation (a) ............... 998,920
------------
3,235,474
------------
FINANCIAL -- 17.3%
18,500 American International Group, Inc. ........... 1,319,975
17,000 Bank of America Corporation .................. 1,376,660
32,000 Citigroup, Inc. .............................. 1,654,400
7,000 Fannie Mae ................................... 520,450
11,200 Goldman Sachs Group, Inc. (The) .............. 1,168,720
18,600 J.P. Morgan Chase & Company .................. 780,270
29,500 Principal Financial Group, Inc. .............. 1,051,085
18,200 Prudential Financial, Inc. ................... 814,996
------------
8,686,556
------------
HEALTHCARE -- 14.6%
19,000 Amgen, Inc.(a) ............................... 1,105,230
19,000 Anthem, Inc. (a) ............................. 1,722,160
13,000 Johnson & Johnson ............................ 659,360
12,000 Medtronic, Inc. .............................. 573,000
48,000 Pfizer, Inc. ................................. 1,682,400
16,400 Teva Pharmaceutical Industries Ltd. .......... 1,039,924
6,500 Varian Medical Systems, Inc. (a) ............. 561,015
------------
7,343,089
------------
INDUSTRIALS -- 17.2%
9,400 3M Company ................................... 769,578
46,000 Cendant Corporation .......................... 1,121,940
19,250 Dover Corporation ............................ 746,323
23,000 First Data Corporation ....................... 969,680
8,000 General Dynamics Corporation ................. 714,640
17,000 General Electric Company ..................... 518,840
17,000 Illinois Tool Works, Inc. .................... 1,346,910
17,200 ITT Industries, Inc. ......................... 1,312,876
51,000 Norfolk Southern Corporation ................. 1,126,590
------------
8,627,377
------------
21
THE JAMESTOWN EQUITY FUND
PORTFOLIO OF INVESTMENTS (Continued)
================================================================================
SHARES COMMON STOCKS -- 99.9% (Continued) VALUE
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY -- 20.8%
41,800 Accenture Ltd. - Class A (a) ................. $ 1,036,640
27,800 Affiliated Computer Services, Inc. (a) ....... 1,442,820
16,000 Analog Devices, Inc. ......................... 768,160
30,100 Cisco Systems, Inc.(a) ....................... 707,952
28,400 Dell Computer Corporation (a) ................ 954,808
41,800 Intel Corporation ............................ 1,136,960
16,900 Intuit, Inc. (a) ............................. 758,472
9,000 Lexmark International, Inc.(a) ............... 828,000
52,000 Microsoft Corporation ........................ 1,298,440
60,000 Oracle Corporation (a) ....................... 720,600
12,100 Qualcomm, Inc. ............................... 803,682
------------
10,456,534
------------
MATERIALS -- 3.6%
27,900 Praxair, Inc. ................................ 1,035,648
16,300 Vulcan Materials Company ..................... 773,272
------------
1,808,920
------------
TOTAL COMMON STOCKS (Cost $41,360,243) ........ $ 50,124,411
------------
================================================================================
PAR VALUE SHORT-TERM CORPORATE NOTES-- 0.3% VALUE
- --------------------------------------------------------------------------------
$ 154,052 U.S. Bank N.A. Demand Note, 0.84%,
floating rate (Cost $154,052) ................ $ 154,052
------------
TOTAL INVESTMENTS AT VALUE-- 100.2%
(Cost $41,514,295) ........................... $ 50,278,463
LIABILITIES IN EXCESS OF OTHER ASSETS-- (0.2%). ( 91,707)
------------
NET ASSETS-- 100.0% ........................... $ 50,186,756
============
(a) Non-income producing security.
See accompanying notes to financial statements.
22
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
===============================================================================================
PAR VIRGINIA FIXED RATE REVENUE AND GENERAL
VALUE OBLIGATION (GO) BONDS -- 98.6% VALUE
- -----------------------------------------------------------------------------------------------
Alexandria, Virginia, GO,
$1,000,000 5.00%, due 06/15/2011 ....................................... $ 1,126,500
Alexandria, Virginia, Redev. and Housing Authority,
Residental Care Facility, Revenue,
700,000 1.02%, floating rate, due 10/01/2006 ........................ 700,000
Arlington Co., Virginia, GO,
990,000 5.40%, due 06/01/2014, prerefunded 06/01/2005 @ 101.5 ....... 1,053,736
Chesapeake Bay Bridge and Tunnel, Virginia, Revenue,
1,000,000 5.70%, due 07/01/2008, prerefunded 07/01/2005 @ 102 ......... 1,076,000
Chesapeake, Virginia, GO,
1,000,000 5.50%, due 05/01/2011 ....................................... 1,066,890
Chesterfield Co., Virginia, GO,
85,000 6.25%, due 07/15/2005 ....................................... 87,979
1,000,000 4.75%, due 01/01/2013, prerefunded 01/01/2008 @ 100 ......... 1,092,780
Fairfax Co., Virginia, Economic Dev. Authority, Revenue,
1,000,000 5.00%, due 06/01/2018 ....................................... 1,087,030
Hampton, Virginia, GO,
1,000,000 5.50%, due 02/01/2012 ....................................... 1,140,500
Hanover Co., Virginia, GO,
1,000,000 5.125%, due 07/15/2013 ...................................... 1,122,720
Hanover Co., Virginia, Industrial Dev. Authority, Revenue,
1,000,000 6.50%, due 08/15/2009 ....................................... 1,189,360
Henrico Co., Virginia, Economic Dev. Authority, Revenue,
1,000,000 5.50%, due 11/01/2008 ....................................... 1,139,970
James City, Virginia, Water and Sewer Authority, Revenue,
1,000,000 5.125%, due 01/15/2017 ...................................... 1,103,130
Loudoun Co., Virginia, Industrial Dev. Authority, Public
Facility Lease, Revenue,
1,000,000 5.00%, due 03/01/2019 ....................................... 1,072,020
Medical College of Virginia Hospitals Authority, Revenue,
700,000 5.00%, due 07/01/2013 ....................................... 761,537
Newport News, Virginia, GO,
1,000,000 5.625%, due 07/01/2014, prerefunded 07/01/2005 @ 102 ........ 1,075,070
Norfolk, Virginia, Industrial Dev. Authority, Revenue,
1,000,000 6.50%, due 11/01/2013 ....................................... 1,046,700
Norfolk, Virginia, Water, Revenue,
1,000,000 5.00%, due 11/01/2016 ....................................... 1,087,750
Pamunkey, Virginia, Regional Jail Authority, Jail Facility, Revenue,
1,000,000 5.70%, due 07/01/2010, prerefunded 07/01/2006 @ 102.......... 1,110,000
Portsmouth, Virginia, GO,
800,000 5.00%, due 08/01/2017 ....................................... 863,088
Prince William Co., Virginia, Park Authority, Revenue,
250,000 6.10%, due 10/15/2004, escrowed to maturity ................. 256,715
Richmond, Virginia, GO,
1,000,000 5.45%, due 01/15/2008 ....................................... 1,119,700
Richmond, Virginia, Industrial Dev. Authority, Government
Facilities, Revenue,
1,010,000 4.75%, due 07/15/2010 ....................................... 1,122,565
Richmond, Virginia, Metropolitan Authority, Revenue,
1,000,000 5.25%, due 07/15/2014 ....................................... 1,146,330
23
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
===============================================================================================
PAR VIRGINIA FIXED RATE REVENUE AND GENERAL
VALUE OBLIGATION (GO) BONDS -- 98.6% (Continued) VALUE
- -----------------------------------------------------------------------------------------------
Roanoke, Virginia, GO,
$1,000,000 5.00%, due 08/01/2009 ....................................... $ 1,092,610
Southeastern Public Service Authority, Virginia, Revenue,
1,000,000 5.00%, due 07/01/2015 ....................................... 1,116,390
Suffolk, Virginia, GO,
350,000 5.80%, due 06/01/2011, prerefunded 06/01/2006 @ 102 388,224
1,000,000 5.00%, due 12/01/2015 ....................................... 1,093,000
University of Virginia, Revenue,
1,000,000 5.25%, due 06/01/2012 ....................................... 1,128,480
Upper Occoquan, Virginia, Sewer Authority, Revenue,
700,000 5.00%, due 07/01/2015 ....................................... 755,132
Virginia Beach, Virginia, GO,
800,000 5.25%, due 08/01/2010 ....................................... 900,600
Virginia Commonwealth Transportation Board, Revenue,
850,000 7.25%, due 05/15/2020 ....................................... 984,138
Virginia Resource Authority, Revenue,
500,000 5.50%, due 05/01/2017 ....................................... 563,820
Virginia State Housing Dev. Authority, Multi-Family, Revenue,
150,000 6.60%, due 11/01/2012 ....................................... 155,532
150,000 6.30%, due 11/01/2015 ....................................... 156,083
Virginia State Public School Authority, Revenue,
1,000,000 5.25%, due 08/01/2009 ....................................... 1,137,390
-------------
TOTAL VIRGINIA FIXED RATE REVENUE AND GENERAL
OBLIGATION (GO) BONDS (Cost $31,028,277) ................... $ 33,119,469
-------------
===============================================================================================
SHARES MONEY MARKETS -- 0.3% VALUE
- -----------------------------------------------------------------------------------------------
117,583 First American Tax Free Obligation Fund -
Class S (Cost $117,583) ..................................... $ 117,583
-------------
TOTAL INVESTMENTS AT VALUE-- 98.9% (Cost $31,145,860) ........ $ 33,237,052
OTHER ASSETS IN EXCESS OF LIABILITIES-- 1.1% ................. 365,050
-------------
NET ASSETS-- 100.0% .......................................... $ 33,602,102
=============
See accompanying notes to financial statements.
24
THE JAMESTOWN INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 97.9% VALUE
- --------------------------------------------------------------------------------
BRAZIL -- 1.6%
2,227 Banco Itau Holding Financeira SA - ADR ....... $ 104,157
7,164 Petroleo Brasileiro SA - ADR ................. 239,994
------------
344,151
------------
FRANCE -- 12.5%
4,729 Accor SA ..................................... 191,604
5,769 Bouygues SA .................................. 198,507
5,510 Carrefour SA ................................. 271,798
7,148 France Telecom SA ............................ 182,887
2,459 Lafarge SA ................................... 198,989
3,509 Lagardere S.C.A .............................. 199,785
2,635 L'Oreal SA ................................... 201,737
3,411 Pinault-Printemps-Redoute SA ................. 356,511
2,674 Total Fina Elf SA ............................ 490,940
3,402 Valeo SA ..................................... 141,141
7,912 Vivendi Universal SA(a) ...................... 209,726
------------
2,643,625
------------
GERMANY -- 3.4%
2,110 Adidas - Salomon AG .......................... 244,518
1,661 Allianz AG ................................... 181,279
4,782 Bayerische Motoren Werke (BMW) AG ............ 195,691
1,741 Duetsche Boerse AG ........................... 98,845
------------
720,333
------------
HONG KONG -- 3.2%
40,000 Sun Hung Kai Properties Ltd. ................. 365,802
47,500 Swire Pacific Ltd. - Class A ................. 321,601
------------
687,403
------------
ITALY -- 7.3%
116,566 Banca Intesa SpA ............................. 385,337
27,939 Eni SpA ...................................... 561,708
23,874 Fiat SpA(a) .................................. 164,884
39,230 Mediaset SpA ................................. 435,334
------------
1,547,263
------------
JAPAN -- 22.5%
21,000 Bridgestone Corporation ...................... 329,629
4,000 Canon, Inc. .................................. 207,238
14,000 Daiwa House Industry Company Ltd. ............ 178,709
15,000 Denso Corporation ............................ 341,712
29,000 Matsushita Electric Industrial Company Ltd. .. 448,234
25 Millea Holdings, Inc. ........................ 389,292
6,000 Misawa Homes Holdings, Inc.(a) ............... 27,337
36,000 Mitsubishi Estate Company Ltd. ............... 488,259
52 Mitsubishi Tokyo Financial Group, Inc. ....... 514,827
25,000 Mitsui Sumitomo Insurance Company Ltd. ....... 266,257
21,000 Nissan Motor Company Ltd. .................... 235,161
13,000 Nomura Holdings, Inc. ........................ 236,795
2,800 Orix Corporation ............................. 309,780
4,600 Shin-Etsu Chemical Company Ltd. .............. 193,666
25
THE JAMESTOWN INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 97.9% (Continued) VALUE
- --------------------------------------------------------------------------------
JAPAN-- 22.5% (Continued)
1,500 TDK Corporation .............................. $ 114,625
75 UFJ Holdings, Inc. ........................... 477,243
------------
4,758,764
------------
KOREA -- 4.7%
5,100 Daewoo Shipbuilding & Marine Engineering
Company Ltd.(a) ............................. 54,049
2,430 Hyundai Motor Company Ltd. ................... 111,066
4,830 Kookmin Bank - ADR(a) ........................ 195,422
815 Samsung Electronics Company Ltd. ............. 406,629
550 Shinsegae Company Ltd. ....................... 135,767
4,329 SK Telecom Company Ltd. - ADR ................ 92,208
------------
995,141
------------
MALAYSIA -- 0.5%
18,800 Malayan Banking Berhad ....................... 57,389
18,300 Resorts World Berhad ......................... 50,566
------------
107,955
------------
MEXICO -- 2.4%
10,034 Cemex SA de CV - ADR ......................... 299,214
2,423 Grupo Televisa SA - ADR ...................... 114,705
30,153 Wal-Mart de Mexico SA de CV .................. 92,052
------------
505,971
------------
NETHERLANDS -- 2.5%
4,088 Heineken NV .................................. 163,774
12,701 VNU NV ....................................... 363,672
------------
527,446
------------
PORTUGAL -- 3.1%
44,522 Banco Comercial Portugues SA ................. 109,973
37,947 Electricidade de Portugal (EDP) SA ........... 107,256
35,725 Portugal Telecom SGPS SA ..................... 399,512
38,082 Sonae SGPS SA (a) ............................ 43,523
------------
660,264
------------
SINGAPORE -- 1.7%
24,000 DBS Group Holdings Ltd. ...................... 206,174
19,000 United Overseas Bank Ltd. .................... 151,887
------------
358,061
------------
SPAIN -- 4.9%
1,958 Acerinox SA .................................. 95,838
16,278 Banco Bilbao Vizcaya Argentaria SA ........... 215,443
10,219 Iberdrola SA ................................. 210,977
33,688 Telefonica SA(a) ............................. 509,624
------------
1,031,882
------------
SWEDEN -- 3.6%
3,245 Autoliv, Inc. - SDR .......................... 132,101
76,153 Telefonaktiebolaget LM Ericsson - B Shares(a) 211,051
47,427 Skandia Forsakrings AB ....................... 187,411
6,818 Volvo AB - B Shares .......................... 224,666
------------
755,229
------------
26
THE JAMESTOWN INTERNATIONAL EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 97.9% (Continued) VALUE
- --------------------------------------------------------------------------------
SWITZERLAND -- 4.9%
9,080 Compagnie Financiere Richemont AG ............ $ 244,049
8,342 Credit Suisse Group .......................... 289,074
1,142 Nestle SA .................................... 291,168
2,154 Roche Holding AG(a) .......................... 210,410
------------
1,034,701
------------
TAIWAN -- 1.6%
193,000 Chinatrust Financial Holding Company Ltd. .... 231,366
54,240 Taiwan Semiconductor Manufacturing Company Ltd.(a) 98,768
------------
330,134
------------
UNITED KINGDOM -- 17.5%
8,541 Astrazeneca PLC .............................. 396,037
66,476 Bae Systems PLC .............................. 245,873
15,495 Diageo PLC ................................... 202,048
20,430 HSBC Holdings PLC ............................ 303,758
17,619 Imperial Tobacco PLC ......................... 385,011
15,733 InterContinental Hotels Group PLC(a) ......... 143,563
56,579 Kingfisher PLC ............................... 300,773
10,614 Next PLC ..................................... 277,974
27,233 Pearson PLC .................................. 309,560
24,774 Reed Elsevier PLC ............................ 219,231
28,169 Shell Transport & Trading Company PLC ........ 184,044
25,014 Smith & Nephew PLC ........................... 246,410
205,477 Vodafone Group PLC ........................... 487,150
------------
3,701,432
------------
TOTAL COMMON STOCKS-- 97.9% (Cost $17,419,136) $ 20,709,755
OTHER ASSETS IN EXCESS OF LIABILITIES-- 2.1% . 448,600
------------
NET ASSETS-- 100.0% .......................... $ 21,158,355
============
(a) Non-income producing security.
ADR - American Depository Receipt
SDR - Swedish Depository Receipt
See accompanying notes to financial statements.
27
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Jamestown Balanced Fund, The Jamestown Equity Fund, The Jamestown Tax Exempt
Virginia Fund and The Jamestown International Equity Fund (individually, a Fund,
and, collectively, the Funds) are each a no-load series of the Williamsburg
Investment Trust (the Trust), an open-end management investment company
registered under the Investment Company Act of 1940. The Trust was organized as
a Massachusetts business trust on July 18, 1988.
The Jamestown Balanced Fund's investment objectives are long-term growth of
capital and income through investment in a balanced portfolio of equity and
fixed income securities. Capital protection and low volatility are important
investment goals.
The Jamestown Equity Fund's investment objective is long-term growth of capital
through investment in a diversified portfolio composed primarily of common
stocks. Current income is incidental to this objective and may not be
significant.
The Jamestown Tax Exempt Virginia Fund's investment objectives are to provide
current income exempt from federal income taxes and from the personal income
taxes of Virginia, to preserve capital, to limit credit risk and to take
advantage of opportunities to increase and enhance the value of a shareholder's
investment.
The Jamestown International Equity Fund's investment objective is to achieve
superior total returns through investment in equity securities of issuers
located outside the United States of America.
The following is a summary of the Funds' significant accounting policies:
Securities valuation -- The Funds' portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities which are traded over-the-counter
are valued at the last sales price, if available, otherwise, at the last quoted
bid price. Securities traded on a national or foreign stock exchange are valued
based upon the closing price on the principal exchange where the security is
traded. Securities which are quoted by NASDAQ are valued at the NASDAQ Official
Closing Price. It is expected that fixed income securities will ordinarily be
traded in the over-the-counter market, and common stocks will ordinarily be
traded on a national securities exchange, but may also be traded in the
over-the-counter market. When market quotations are not readily available, fixed
income securities may be valued on the basis of prices provided by an
independent pricing service. If a pricing service cannot provide a valuation,
securities will be valued in good faith at fair value using methods consistent
with those determined by the Board of Trustees. Such methods of fair valuation
may include, but are not limited to: multiple of earnings, multiple of book
value, discount from market of a similar freely traded security, purchase price
of security, subsequent private transactions in the security or related
securities, or a combination of these and other factors. Foreign securities are
translated from the local currency into U.S. dollars using currency exchange
rates supplied by a quotation service. Short-term instruments (those with
remaining maturities of 60 days or less) are valued at amortized cost, which
approximates market value.
28
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Repurchase agreements -- The Funds may enter into joint repurchase agreements
with each other and with other funds within the Trust. The joint repurchase
agreement, which is collateralized by U.S. Government obligations, is valued at
cost which, together with accrued interest, approximates market. At the time the
Funds enter into the joint repurchase agreement, the seller agrees that the
value of the underlying securities, including accrued interest, will at all
times be equal to or exceed the face amount of the repurchase agreement. In
addition, each Fund actively monitors and seeks additional collateral, as
needed.
Share valuation -- The net asset value per share of each Fund is
calculated daily by dividing the total value of each Fund's assets, less
liabilities, by the number of shares outstanding. The offering price and
redemption price per share of each Fund is equal to the net asset value per
share, except that shares of The Jamestown International Equity Fund are subject
to a redemption fee of 2% if redeemed within 90 days of the date of purchase.
For the years ended March 31, 2004 and 2003, proceeds from redemption fees total
$400 and $40,984, respectively.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed income
securities purchased are amortized using the interest method.
Distributions to shareholders -- Dividends arising from net investment income,
if any, are declared and paid quarterly to shareholders of The Jamestown
Balanced Fund, The Jamestown Equity Fund and The Jamestown International Equity
Fund and are declared daily and paid monthly to shareholders of The Jamestown
Tax Exempt Virginia Fund. Net realized short-term capital gains, if any, may be
distributed throughout the year and net realized long-term capital gains, if
any, are distributed at least once each year. The amount of distributions from
net investment income and net realized gains are determined in accordance with
federal income tax regulations which may differ from accounting principles
generally accepted in the United States. These "book/tax" differences are either
temporary or permanent in nature and are primarily due to losses deferred due to
wash sales and treatment for foreign currency transactions.
The tax character of distributions paid during the years ended March 31, 2004
and 2003 was as follows:
- ----------------------------------------------------------------------------------------------------------------------
EXEMPT-
YEARS ORDINARY LONG-TERM INTEREST TOTAL
ENDED INCOME CAPITAL GAINS DIVIDENDS DISTRIBUTIONS
- ----------------------------------------------------------------------------------------------------------------------
Jamestown Balanced Fund 3/31/04 $ 1,584,645 $ 2,991,258 $ -- $ 4,575,903
3/31/03 $ 1,721,820 $ -- $ -- $ 1,721,820
- ----------------------------------------------------------------------------------------------------------------------
Jamestown Equity Fund 3/31/04 $ 127,664 $ 1,325,502 $ -- $ 1,453,166
3/31/03 $ 109,812 $ -- $ -- $ 109,812
- ----------------------------------------------------------------------------------------------------------------------
Jamestown Tax Exempt Virginia Fund 3/31/04 $ -- $ -- $ 1,211,959 $ 1,211,959
3/31/03 $ -- $ -- $ 1,349,803 $ 1,349,803
- ----------------------------------------------------------------------------------------------------------------------
Jamestown International Equity Fund 3/31/04 $ 150,544 $ -- $ -- $ 150,544
3/31/03 $ 167,663 $ -- $ -- $ 167,663
- ----------------------------------------------------------------------------------------------------------------------
29
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Security transactions -- Security transactions are accounted for on trade date.
Cost of securities sold is determined on a specific identification basis.
Securities traded on a "to-be-announced" basis -- The Jamestown Balanced Fund
occasionally trades securities on a "to-be-announced" (TBA) basis. In a TBA
transaction, the Fund has committed to purchase securities for which all
specific information is not yet known at the time of the trade, particularly the
face amount in mortgage-backed securities transactions. Securities purchased on
a TBA basis are not settled until they are delivered to the Fund, normally 15 to
45 days later. These transactions are subject to market fluctuations and their
current value is determined in the same manner as for other portfolio
securities.
Common expenses -- Common expenses of the Trust are allocated among the funds of
the Trust based on relative net assets of each fund or the nature of the
services performed and the relative applicability to each fund.
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of income and expenses during the reporting period. Actual results could
differ from those estimates.
Federal income tax -- It is each Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which a Fund so
qualifies and distributes at least 90% of its taxable net income, the Fund (but
not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The tax character of distributable earnings at March 31, 2004 was as follows:
- ------------------------------------------------------------------------------------------------------------------
JAMESTOWN JAMESTOWN JAMESTOWN JAMESTOWN
BALANCED EQUITY TAX EXEMPT INTERNATIONAL
FUND FUND VIRGINIA FUND EQUITY FUND
- ------------------------------------------------------------------------------------------------------------------
Cost of portfolio investments .................... $ 52,831,489 $ 41,535,945 $ 31,134,414 $ 17,881,047
============ ============ ============ ============
Gross unrealized appreciation .................... $ 11,346,740 $ 9,203,868 $ 2,126,559 $ 3,441,427
Gross unrealized depreciation .................... (403,722) (461,350) (23,921) (612,719)
------------ ------------ ------------ ------------
Net unrealized appreciation on investments ....... $ 10,943,018 $ 8,742,518 $ 2,102,638 $ 2,828,708
Net unrealized appreciation on translation of
assets and liabilities in foreign currencies ..... -- -- -- 1,396
Undistributed ordinary income .................... 24,777 -- 28,052 18,572
Undistributed long-term gains .................... 96,632 86,733 -- --
Capital loss carryforwards ....................... -- -- (79,673) (19,373,636)
Other temporary differences ...................... (119,617) (86,733) (28,052) --
------------ ------------ ------------ ------------
Total distributable earnings (accumulated deficit) $ 10,944,810 $ 8,742,518 $ 2,022,965 $(16,524,960)
============ ============ ============ ============
- ------------------------------------------------------------------------------------------------------------------
30
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for the Funds is due to certain timing differences
in the recognition of capital gains or losses under income tax regulations and
accounting principles generally accepted in the United States. These "book/tax"
differences are either temporary or permanent in nature and are primarily due to
the tax deferral of losses on wash sales and/or differing methods in the
amortization of discounts and premiums on fixed income securities.
During the year ended March 31, 2004, The Jamestown Balanced Fund, The Jamestown
Equity Fund and the The Jamestown Tax Exempt Virginia Fund utilized capital loss
carryforwards of $24,709, $27,179 and $126,089, respectively, to offset current
year realized gains.
As of March 31, 2004, the Funds had the following capital loss carryforwards for
federal income tax purposes:
- --------------------------------------------------------------------------------
EXPIRES
AMOUNT MARCH 31,
- --------------------------------------------------------------------------------
Jamestown Tax Exempt Virginia Fund $ 79,673 2009
Jamestown International Equity Fund $ 4,874,364 2010
13,878,931 2011
620,341 2012
------------
$ 19,373,636
============
- --------------------------------------------------------------------------------
These capital loss carryforwards may be utilized in future years to offset net
realized capital gains, if any, prior to distribution to shareholders.
For the year ended March 31, 2004, The Jamestown Balanced Fund reclassified
$153,385 of overdistributed net investment income against accumulated net
realized gains and The Jamestown Tax Exempt Virginia Fund reclassified $11,077
of undistributed net investment income against accumulated net realized losses
on the Statement of Assets and Liabilities due to permanent differences in the
recognition of capital gains or losses under income tax regulations and
accounting principles generally accepted in the United States.
2. INVESTMENT TRANSACTIONS
Investment transactions, other than short-term investments and U.S. government
securities, were as follows for the year ended March 31, 2004:
- ------------------------------------------------------------------------------------------------------------------
JAMESTOWN JAMESTOWN JAMESTOWN JAMESTOWN
BALANCED EQUITY TAX EXEMPT INTERNATIONAL
FUND FUND VIRGINIA FUND EQUITY FUND
- ------------------------------------------------------------------------------------------------------------------
Purchases of investment securities ......... $ 21,809,602 $ 25,183,325 $ 14,641,690 $ 17,589,168
============== ============= ============ =============
Proceeds from sales and maturities
of investment securities .................. $ 28,742,715 $ 23,067,148 $ 15,668,969 $ 26,531,579
============== ============= ============ =============
- ------------------------------------------------------------------------------------------------------------------
31
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AND SUB-ADVISORY AGREEMENTS
The Funds' investments are managed by Lowe, Brockenbrough & Company, Inc. (the
Adviser), under the terms of an Investment Advisory Agreement. Under the
Investment Advisory Agreement, The Jamestown Balanced Fund pays the Adviser a
fee, which is computed and accrued daily and paid monthly, at an annual rate of
..65% on its average daily net assets up to $250 million, .60% on the next $250
million of such net assets and .55% on such net assets in excess of $500
million. The Jamestown Equity Fund pays the Adviser a fee at an annual rate of
..65% on its average daily net assets up to $500 million and .55% on such net
assets in excess of $500 million. The Jamestown Tax Exempt Virginia Fund pays
the Adviser a fee at an annual rate of .40% on its average daily net assets up
to $250 million, .35% on the next $250 million of such net assets and .30% on
such net assets in excess of $500 million. The Jamestown International Equity
Fund pays the Adviser a fee at an annual rate of 1.00% on its average daily net
assets. Certain Trustees and officers of the Trust are also officers of the
Adviser.
The Adviser currently intends to limit the total operating expenses of The
Jamestown Tax Exempt Virginia Fund and The Jamestown International Equity Fund
to 0.69% and 1.38%, respectively, of each Fund's average daily net assets.
Accordingly, the Adviser voluntarily waived $17,601 and $91,144, respectively,
of such Funds' investment advisory fees during the year ended March 31, 2004.
The Adviser retains Oechsle International Advisors, LLC (Oechsle) to provide The
Jamestown International Equity Fund with a continuous program of supervision of
the Fund's assets, including the composition of its portfolio, and to furnish
advice and recommendations with respect to investments, investment policies and
the purchase and sale of securities, pursuant to the terms of a Sub-Advisory
Agreement. Under the Sub-Advisory Agreement, the Adviser, not the Fund, pays
Oechsle a fee in the amount of one-half of the monthly advisory fee received by
the Adviser, net of any investment advisory fee waivers.
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Funds. For these services, Ultimus receives a monthly fee from
each of The Jamestown Balanced Fund, The Jamestown Equity Fund and The Jamestown
Tax Exempt Virginia Fund at an annual rate of .15% on its respective average
daily net assets up to $25 million; .125% on the next $25 million of such net
assets; and .10% on such net assets in excess of $50 million. From The Jamestown
International Equity Fund, Ultimus receives a monthly fee at an annual rate of
..20% on its average daily net assets up to $25 million; .175% on the next $25
million of such net assets; and .15% on such net assets in excess of $50
million. In addition, each Fund pays out-of-pocket expenses including, but not
limited to, postage, supplies and costs of pricing the Funds' portfolio
securities. Certain officers of the Trust are also officers of Ultimus, or of
Ultimus Fund Distributors, LLC, the principal underwriter of each Fund's shares
and an affiliate of Ultimus.
32
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
4. DIRECTED BROKERAGE ARRANGEMENT
In order to reduce the total operating expenses of The Jamestown Balanced Fund
and The Jamestown Equity Fund, each Fund's custodian fees and a portion of other
operating expenses have been paid through an arrangement with a third-party
broker-dealer who is compensated through commission trades. Payment of expenses
by the broker-dealer is based on a percentage of commissions earned. Expenses
reimbursed through the directed brokerage arrangement totaled $24,000 and
$28,000 for The Jamestown Balanced Fund and The Jamestown Equity Fund,
respectively, for the year ended March 31, 2004.
5. FOREIGN CURRENCY TRANSLATION
With respect to The Jamestown International Equity Fund, amounts denominated in
or expected to settle in foreign currencies are translated into U.S. dollars
based on exchange rates on the following basis:
A. The market values of investment securities and other assets and liabilities
are translated at the closing rate of exchange each day.
B. Purchases and sales of investment securities and income and expenses are
translated at the rate of exchange prevailing on the respective dates of such
transactions.
C. The Fund does not isolate that portion of the results of operations caused by
changes in foreign exchange rates on investments from those caused by changes in
market prices of securities held. Such fluctuations are included with the net
realized and unrealized gains or losses on investments.
Reported net realized foreign exchange gains or losses arise from 1) purchases
and sales of foreign currencies, 2) currency gains or losses realized between
the trade and settlement dates on securities transactions and 3) the difference
between the amounts of dividends, interest and foreign withholding taxes
recorded on the Fund's books, and the U.S. dollar equivalent of the amounts
actually received or paid. Reported net unrealized foreign exchange gains and
losses arise from changes in the value of assets and liabilities, other than
investment securities, resulting from changes in exchange rates.
6. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The Jamestown International Equity Fund enters into forward foreign currency
exchange contracts as a way of managing foreign exchange rate risk. The Fund may
enter into these contracts for the purchase or sale of a specific foreign
currency at a fixed price on a future date as a hedge or cross-hedge against
either specific transactions or portfolio positions. The objective of the Fund's
foreign currency hedging transactions is to reduce risk that the U.S. dollar
value of the Fund's securities denominated in foreign currency will decline in
value due to changes in foreign currency exchange rates. All foreign currency
exchange contracts are "marked-to-market" daily at the applicable translation
rates resulting in unrealized gains or losses. Realized and unrealized gains or
losses are included in the Fund's Statement of Assets and Liabilities and
Statement of Operations. Risks may arise
33
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
upon entering into these contracts from the potential inability of
counterparties to meet the terms of their contracts and from unanticipated
movements in the value of a foreign currency relative to the U.S. dollar.
As of March 31, 2004, The Jamestown International Equity Fund had no outstanding
forward foreign currency exchange contracts.
5. CONTINGENCIES AND COMMITMENTS
The Funds indemnify the Trust's officers and trustees for certain liabilities
that might arise from their performance of their duties to the Funds.
Additionally, in the normal course of business the Funds enter into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Funds' maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Funds that have not yet occurred. However, based on experience, the Funds expect
the risk of loss to be remote.
34
REPORT OF INDEPENDENT AUDITORS
================================================================================
To the Board of Trustees and Shareholders of
The Jamestown Balanced Fund, The Jamestown Equity Fund,
The Jamestown Tax Exempt Virginia Fund, and The Jamestown International Fund
of the Williamsburg Investment Trust
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of The Jamestown Balanced Fund, The Jamestown
Equity Fund, The Jamestown Tax Exempt Virginia Fund, and The Jamestown
International Fund (the "Funds") (each a series of Williamsburg Investment
Trust) as of March 31, 2004, and the related statements of operations and
changes in net assets and financial highlights for the year then ended. 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. The
statements of changes in net assets and financial highlights for the respective
years ended March 31, 2003 were audited by other auditors. Those auditors
expressed an unqualified opinion on the statements of changes in net assets and
financial highlights in their report dated April 25, 2003.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of March 31, 2004, by correspondence with the custodian and brokers or
by other appropriate auditing procedures where replies from brokers were not
received. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial positions of The
Jamestown Balanced Fund, The Jamestown Equity Fund, The Jamestown Tax Exempt
Virginia Fund, and The Jamestown International Fund as of March 31, 2004, the
results of their operations, the changes in their net assets and their financial
highlights for the year then ended, in conformity with accounting principles
generally accepted in the United States.
/s/ Ernst & Young LLP
Cincinnati, Ohio
May 6, 2004
35
BOARD OF TRUSTEES AND EXECUTIVE OFFICERS
(UNAUDITED)
================================================================================
Overall responsibility for management of the Funds rests with the Board of
Trustees. The Trustees serve during the lifetime of the Trust and until its
termination, or until death, resignation, retirement or removal. The Trustees,
in turn, elect the officers of the Funds to actively supervise the day-to-day
operations. The officers have been elected for an annual term. The following are
the Trustees and executive officers of the Funds:
POSITION HELD LENGTH OF
TRUSTEE ADDRESS AGE WITH THE TRUST TIME SERVED
- -----------------------------------------------------------------------------------------------------------------------------
*Charles M. Caravati, Jr. 931 Broad Street Road 67 Chairman and Since
Manakin-Sabot, VA Trustee June 1991
- -----------------------------------------------------------------------------------------------------------------------------
*Austin Brockenbrough III 1802 Bayberry Court, Suite 400 67 Trustee and Since
Richmond, VA Vice President September 1988
- -----------------------------------------------------------------------------------------------------------------------------
*John T. Bruce 800 Main Street 50 Trustee Since
Lynchburg, VA September 1988
- -----------------------------------------------------------------------------------------------------------------------------
J. Finley Lee 200 Westminster Drive 64 Trustee Since
Chapel Hill, NC September 1988
- -----------------------------------------------------------------------------------------------------------------------------
*Richard Mitchell 150 Government Street 54 Trustee Since
Mobile, AL June 1991
- -----------------------------------------------------------------------------------------------------------------------------
Richard L. Morrill University of Richmond 64 Trustee Since
Richmond, VA March 1993
- -----------------------------------------------------------------------------------------------------------------------------
Harris V. Morrissette 100 Jacintopport Boulevard 44 Trustee Since
Saraland, AL March 1993
- -----------------------------------------------------------------------------------------------------------------------------
Erwin H. Will, Jr. 47 Willway Avenue 71 Trustee Since
Richmond, VA July 1997
- -----------------------------------------------------------------------------------------------------------------------------
Samuel B. Witt III 2300 Clarendon Boulevard, Suite 407 68 Trustee Since
Arlington, VA November 1988
- -----------------------------------------------------------------------------------------------------------------------------
Charles M. Caravati III 1802 Bayberry Court, Suite 400 39 President, Jamestown Since
Richmond, VA Balanced Fund, January 1996
Equity Fund and
International Equity Fund
- -----------------------------------------------------------------------------------------------------------------------------
Beth Ann Gustafson 1802 Bayberry Court, Suite 400 45 President, Jamestown Since
Richmond, VA Tax Exempt Virginia Fund March 1995
- -----------------------------------------------------------------------------------------------------------------------------
Lawrence B. Whitlock, Jr. 1802 Bayberry Court, Suite 400 56 Vice President, Jamestown Since
Richmond, VA Balanced Fund and February 2002
Equity Fund
- -----------------------------------------------------------------------------------------------------------------------------
Connie R. Taylor 1802 Bayberry Court, Suite 400 54 Vice President, Jamestown Since
Richmond, VA Balanced Fund and March 1993
Equity Fund
- -----------------------------------------------------------------------------------------------------------------------------
Pamela C. Simms 1802 Bayberry Court, Suite 400 43 Vice President, Jamestown Since
Richmond, VA Tax Exempt Virginia Fund February 2003
- -----------------------------------------------------------------------------------------------------------------------------
Robert G. Dorsey 135 Merchant Street, Suite 230 47 Vice President Since
Cincinnati, OH November 2000
- -----------------------------------------------------------------------------------------------------------------------------
Mark J. Seger 135 Merchant Street, Suite 230 42 Treasurer Since
Cincinnati, OH November 2000
- -----------------------------------------------------------------------------------------------------------------------------
John F. Splain 135 Merchant Street, Suite 230 47 Secretary Since
Cincinnati, OH November 2000
- -----------------------------------------------------------------------------------------------------------------------------
* Messrs. Bruce, Brockenbrough, Caravati and Mitchell are "interested
persons" of the Trust within the meaning of Section 2(a)(19) of the
Investment Company Act of 1940. Charles M. Caravati, Jr. is the father of
Charles M. Caravati III.
36
BOARD OF TRUSTEES AND EXECUTIVE OFFICERS
(UNAUDITED)
================================================================================
Each Trustee oversees eleven portfolios of the Trust, including the Funds. The
principal occupations of the Trustees and executive officers of the Funds during
the past five years and public directorships held by the Trustees are set forth
below:
Charles M. Caravati, Jr. is a retired physician. He is also the retired
President of Dermatology Associates of Virginia, P.C.
Austin Brockenbrough III is President and Managing Director of the Adviser. He
is a member of the Board of Directors of Tredegar Corporation (a plastics
manufacturer) and Wilkinson O'Grady & Co., Inc. (a global asset manager). In
addition, he is a member of the Board of Trustees for the University of
Richmond.
John T. Bruce is a Principal of Flippin, Bruce & Porter, Inc. (an investment
advisory firm).
J. Finley Lee is a financial consultant and the Julian Price Professor Emeritus
at the University of North Carolina.
Richard Mitchell is a Principal of T. Leavell & Associates, Inc. (an investment
advisory firm). Richard L. Morrill is the Chancellor of the University of
Richmond. He is also a member of the Board of Directors of Tredegar Corporation
and Albemarle Corporation (polymers and chemicals manufacturer).
Harris V. Morrissette is President of Marshall Biscuit Co., Inc. He is a member
of the Board of Directors of BancTrust Financial Group, Inc. (a bank holding
company) and EnergySouth, Inc. In addition, he is Chairman of Azalea Aviation,
Inc. (an airplane fueling company).
Erwin H. Will, Jr. is the retired Managing Director of Equities of Virginia
Retirment System.
Samuel B. Witt III is Senior Vice President and General Counsel of Stateside
Associates, Inc. He is also a member of the Board of Directors of The Swiss
Helvetia Fund, Inc. (a closed-end investment company).
Charles M. Caravati III is a Managing Director of the Adviser.
Beth Ann Gustafson is Vice President and a Portfolio Manager of the Adviser.
Lawrence B. Whitlock, Jr. is a Managing Director of the Adviser.
Connie R. Taylor is an Administrator of the Adviser.
Pamela C. Simms is an Administrator of the Adviser.
Robert G. Dorsey is a Managing Director of Ultimus Fund Solutions, LLC and
Ultimus Fund Distributors, LLC.
Mark J. Seger is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
John F. Splain is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
Additional information about member of the Board of Trustees and executive
officers is available in the Statement of Additional Information (SAI). To
obtain a free copy of the SAI, please call 1-866-738-1126.
37
FEDERAL TAX INFORMATION (UNAUDITED)
================================================================================
In accordance with federal tax requirements, the following provides shareholders
with information concerning distributions from ordinary income and net realized
gains made by the Funds during the fiscal year ended March 31, 2004. Certain
dividends paid by the Funds may be subject to a maximum tax rate of 15%, as
provided by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The
Jamestown Balanced Fund, The Jamestown Equity Fund and The Jamestown
International Equity Fund intend to designate up to a maximum amount of
$1,584,645, $127,664 and $150,544, respectively, as taxed at a maximum rate of
15%. For the fiscal year ended March 31, 2004, 100% and 39% of the dividends
paid from ordinary income by The Jamestown Balanced Fund and The Jamestown
Equity Fund, respectively, qualified for the dividends received deduction for
corporations.
Additionally, The Jamestown International Equity Fund intends to make an
election under Internal Revenue Code Section 853 to pass through foreign taxes
paid by the Fund to its shareholders. The total amount of foreign taxes that may
be passed through to the shareholders for the fiscal year ended March 31, 2004
is $83,088. The foreign source income for information purposes is $543,015.
As required by federal regulations, complete information will be computed and
reported in conjunction with your 2004 Form 1099-DIV.
CHANGE IN INDEPENDENT AUDITOR (UNAUDITED)
================================================================================
On February 17, 2004, Tait, Weller & Baker was replaced as independent auditor
of the Funds, and Ernst & Young LLP (Ernst & Young) was selected as the Funds'
new independent auditor. The Funds' selection of Ernst & Young as its
independent auditor was recommended and approved by the Funds' audit committee
and was ratified by the Board of Trustees.
Tait, Weller & Baker's reports on the Funds' financial statements for the prior
two fiscal years did not contain an adverse opinion or a disclaimer of opinion,
and were not qualified or modified as to uncertainty, audit scope or accounting
principles. During such fiscal years, and through the date of Tait, Weller &
Baker's replacement, there were no disagreements between the Funds and Tait,
Weller & Baker on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedures, which disagreements, if
not resolved to the satisfaction of Tait, Weller & Baker, would have caused it
to make reference to the subject matter of the disagreements in connection with
its reports on the financial statements for such years.
38
================================================================================
THE JAMESTOWN FUNDS
Investment Advisor
Lowe, Brockenbrough & Company, Inc.
1802 Bayberry Court
Suite 400
Richmond, Virginia 23226
www.jamestownfunds.com
ADMINISTRATOR
Ultimus Fund Solutions, LLC
P.O. Box 46707
Cincinnati, Ohio 45246-0707
(Toll-Free) 1-866-738-1126
INDEPENDENT AUDITORS
Ernst & Young LLP
1900 Scripps Center
312 Walnut Street
Cincinnati, Ohio 45202
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
BOARD OF TRUSTEES
Austin Brockenbrough, III
John T. Bruce
Charles M. Caravati, Jr.
J. Finley Lee, Jr.
Richard Mitchell
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr.
Samuel B. Witt, III
A description of the policies and procedures that the Fund uses to vote proxies
relating to portfolio securities is available without charge upon request by
calling toll-free 1-866-738-1126, or on the Securities and Exchange Commission's
website at http://www.sec.gov.
================================================================================
================================================================================
==================================================
| |
| THE |
| GOVERNMENT STREET |
| FUNDS |
| |
| |
| No-Load Mutual Funds |
| |
| |
| Annual Report |
| March 31, 2004 |
| (Unaudited) |
| |
==================================================
T. Leavell & Associates, Inc.
----------------------------------
I N V E S T M E N T A D V I S E R
----------------------------------
Founded 1979
==================================================
| |
| The Government Street Equity Fund |
| The Government Street Mid-Cap Fund |
| The Government Street Bond Fund |
| The Alabama Tax Free Bond Fund |
| |
==================================================
LETTER FROM THE PRESIDENT MAY 11, 2004
================================================================================
Dear Fellow Shareholders:
We are enclosing for your review the audited Annual Report of The Government
Street Funds for the year ended March 31, 2004.
THE GOVERNMENT STREET EQUITY FUND
- ---------------------------------
After three consecutive years (2000-2002) of negative performance, the U.S.
stock market experienced a significant rebound across all capitalization ranges
in calendar year 2003 and for the twelve months ended March 31, 2004. The
Government Street Equity Fund (GSEF) participated in this market and for its
fifth consecutive fiscal year outperformed the S&P 500 Index with a return of
36.09% versus the Index's return of 35.12%. The Fund has not accomplished this
goal by hitting "home runs" - i.e., by having concentrations in a few stocks
whose performance greatly exceeded that of the overall market. Rather, the GSEF
has achieved its results by avoiding a situation where the disastrous results of
a few stocks can bring disastrous results to the investment return of the entire
portfolio.
By carefully and systematically constructing a broadly diversified
portfolio of high quality common stocks and by keeping operating and
transactional expenses low, we believe the GSEF can provide investment returns
within a narrow band relative to the market during short periods. This is
crucial in providing the greater compounded returns over longer periods that we
expect our fund to produce.
The GSEF is designed to provide a core investment in an investor's common
stock portfolio. We believe that the S&P 500 Index is representative of the
general market performance of common stocks, and it serves as the Fund's
benchmark for relative performance. The Fund seeks to exceed the performance of
the Index through a process of quantitative stock selection while controlling
risk with broad diversification. In fact, the good relative performance of the
Fund over the past 5 years is less attributable to any isolated decisions made
with respect to individual stock selection than it is to the fact that, on
balance, more good stock selections were made than bad ones. For example, out of
the 136 stocks in the GSEF's portfolio at fiscal year-end, 84 had greater
returns over the previous twelve months than the 35.12% return of the S&P 500.
The balance between growth and value, the diversification over capitalization
ranges of the S&P 500, the broad industry and sub-industry representation and
individual stock selection - taken together - account for the results.
So far, 2004 is unfolding to be a challenging year in the stock market.
Potential increases in the level of interest rates, rising energy prices, the
war in Iraq, the Presidential election and the myriad of other considerations
that affect us everyday are likely to be reflected in increased market
volatility. To attempt to predict the future is foolhardy. To understand the
impact of current events on capital markets is a constant challenge.
Good investment results tend to be achieved through consistent application
of strategies that are governed by an overarching philosophy.
1
The investment philosophy and the investment strategies that have served the
clients of T. Leavell & Associates, Inc. for 25 years will continue to provide a
guideline for The Government Street Equity Fund. The S&P 500 Index has served
for decades as a benchmark for investment managers; and for decades only a
minority of investment managers have consistently outperformed it. By doing so
over the last 5 years, we hope that we have earned the confidence and trust that
you have placed in our Fund.
For the year ended March 31, 2004, the Fund's net assets were $129,718,622;
net asset value was $46.10; and the ratio of expenses to average net assets was
0.79%.
THE GOVERNMENT STREET MID-CAP FUND
- ----------------------------------
On November 17, 2003, T. Leavell & Associates, Inc. launched The Government
Street Mid-Cap Fund. The objective for this Fund is to provide a low cost
vehicle through which investments can be made in a broadly diversified portfolio
of mid-capitalization stocks. As such, we have chosen the Standard & Poor's
MidCap 400 Index as our performance benchmark. Furthermore, we define the common
stocks issued by the companies contained within this index as our primary
universe of potential holdings. The approximate range of market capitalization
for these companies is between $300 million and $11.3 billion. It is our belief
that a portfolio constructed from such a universe of "mid cap" companies can
provide the benefit of additional diversification to an investor and offer a
better overall risk/return ratio for their equity investments.
In fact, the recent trend of strong performance in "mid cap" stocks carried
over into the first quarter of 2004. The consumer staples, consumer
discretionary and energy sectors of the market led the S&P 400 Index higher to
begin the year. These middle capitalization companies outperformed their larger
peers in the S&P 500 Index by approximately 3.38% during the quarter.
So far, we believe The Government Street Mid-Cap Fund is achieving its
performance objectives. For the quarter ended March 31, 2004, the Fund's total
return was 4.55%. For the period since inception (November 17, 2003) through
March 31, 2004, the return was 6.83%. In both cases, this performance trailed
the benchmark S&P MidCap 400 returns of 5.06% and 9.63%, respectively. However,
this underperformance was largely attributable to the timing and process of
becoming fully invested over the first 4 1/2 months of the Fund's existence.
Supporting this statement is the fact that the investment returns of the
equity-only component (i.e., excluding cash and expenses), 5.31% and 9.64% for
the quarter and since inception, respectively, actually exceeded the return of
the Index during those periods. As a result, it is apparent that the cash held
in the Fund (while initial investments were being made) was the primary reason
for the relative underperformance against the Index during these time periods.
These comparative returns give us great confidence that the methodology and
process being used in the portfolio management of the Fund are working. It is
our strong belief that investments in this area of the U.S. stock market
ultimately will enhance the overall investment performance of equity investors.
On March 31, 2004 the net assets of the Fund were $19,226,988; net
asset value was $10.33.
2
THE GOVERNMENT STREET BOND FUND
- -------------------------------
Although the Federal Reserve Board maintained interest rates at
historically low levels during 2003 - cutting the Federal Funds Rate by an
additional 25 basis points to 1.00% - the ebb and flow of inflationary
expectations, economic growth and employment figures resulted in price
volatility and ultimately in below average returns from bonds for the twelve
months ended March 31, 2004.
In anticipation of rising interest rates, The Government Street Bond Fund's
(GSBF) portfolio has continuously been adjusted over the past year to a more and
more defensive position. On March 31, 2004 the Fund's portfolio had an average
maturity of 3.8 years - the lowest in the Fund's 13 year history. By comparison,
the average maturities of the Lehman Aggregate Bond Index and the Lehman
Government/Corporate Intermediate Bond Index were 7.3 years and 4.5 years,
respectively.
As a result of the Fund's defensive strategy (i.e., its short average
maturity), it has under-performed its benchmark over the twelve months ended
March 31, 2004. The GSBF's return was 3.34% compared to the 5.30% return of the
Lehman Government/Corporate Intermediate Bond Index (the Index). The following
chart outlines the defensive structure and investment return of the Fund
(compared to the Index) by sector:
- --------------------------------------------------------------------------------
DURATION 12 MOS. RETURN
- --------------------------------------------------------------------------------
GSBF* LGCI** GSBF* LGCI**
- --------------------------------------------------------------------------------
U.S. Treasuries 2.7 Yrs 3.5 Yrs 3.17% 3.48%
Agencies 4.8 Yrs 3.3 Yrs 3.97% 3.75%
Corporate Bonds 2.7 Yrs 4.2 Yrs 5.22% 7.50%
- --------------------------------------------------------------------------------
* Government Street Bond Fund
** Lehman Government/Corporate Intermediate Bond Index
As outlined above, the Fund's underperformance was particularly acute in
the corporate sector of the Fund where its shorter, high quality issues caused
it to give up return to the Index where there was a premium gained for longer,
lower quality securities.
Interest rates are poised to rise in the months ahead; if they do, bond
prices will fall. Yet, we believe that the GSBF's short, high quality portfolio
will provide stability to the Fund during the volatile interest rate environment
that we anticipate over the next twelve months.
For the year ended March 31, 2004, The Government Street Bond Fund's ratio
of net investment income to average net assets was 3.65%. Net assets of the fund
were $64,004,940; net asset value was $21.24.
3
THE ALABAMA TAX FREE BOND FUND
- ------------------------------
Tax exempt yields and municipal bond prices experienced considerable
volatility during 2003. Despite this volatility, the Alabama Tax Free Bond Fund
(ALABX) ended its fiscal year (March 31, 2004) with its net asset value within
one penny of where it began - $10.89 on March 31, 2003 versus $10.90 on March
31, 2004.
The total return of the Fund was 3.40% for the twelve months ended March
31, 2004 compared to 4.53% for the Lipper Intermediate Municipal Fund Index (the
Index). This underperformance is attributable to the Fund's having a shorter
average maturity and higher average quality than that of the Index. By contrast
the ALABX has only 1.5% of its bonds rated less than A; the funds, which
comprise the Index, have an average of 10% of their portfolios in securities
with ratings less than A. Further, the average maturities of the funds in the
Index are 7.5 years versus 6.0 years for the ALABX.
In addition, the Fund has taken a defensive position in anticipation of
higher interest rates in the months ahead by maintaining higher than normal cash
levels and by continuing to shorten the average maturity of the Fund during the
past twelve months. The longest maturity of any bond acquired during the year
was 7 years, and the weighted average maturity of all purchases was
approximately 4.5 years. This shortening of its average maturity, and
consequently its duration, was a move directed at preserving the Fund's
principal value. Indeed, the Federal Reserve has already laid the groundwork to
begin raising rates at some point during the summer of 2004. In that event, the
ALABX should be well positioned to benefit on a relative basis if not on an
absolute one.
At March 31, 2004, the net assets of the fund were $38,702,253; net asset
value was $10.90; and the ratio of net investment income to average net assets
was 3.26%.
Thank you for your continued confidence in The Government Street Funds.
Please call us if we can be of further service to you.
Very truly yours,
/s/ Thomas W. Leavell /s/ Richard Mitchell
Thomas W. Leavell Richard Mitchell
President President
T. Leavell & Associates, Inc. The Government Street Funds
4
THE GOVERNMENT STREET EQUITY FUND
---------------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE GOVERNMENT STREET EQUITY
FUND, THE STANDARD & POOR'S 500 INDEX AND THE CONSUMER PRICE INDEX
[GRAPHIC OMITTED]
STANDARD & POOR'S 500 INDEX: THE GOVERNMENT STREET EQUITY FUND:
---------------------------- ---------------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 10,000 03/31/94 10,000
06/30/94 0.42% 10,042 06/30/94 -3.00% 9,700
09/30/94 4.89% 10,534 09/30/94 5.37% 10,221
12/31/94 -0.02% 10,531 12/31/94 -1.91% 10,025
03/31/95 9.74% 11,557 03/31/95 6.75% 10,702
06/30/95 9.55% 12,660 06/30/95 7.18% 11,471
09/30/95 7.95% 13,666 09/30/95 6.05% 12,165
12/31/95 6.02% 14,489 12/31/95 5.01% 12,774
03/31/96 5.37% 15,267 03/31/96 5.53% 13,480
06/30/96 4.49% 15,952 06/30/96 2.87% 13,868
09/30/96 3.09% 16,445 09/30/96 5.17% 14,585
12/31/96 8.34% 17,816 12/31/96 6.40% 15,518
03/31/97 2.68% 18,293 03/31/97 1.59% 15,764
06/30/97 17.46% 21,487 06/30/97 16.58% 18,379
09/30/97 7.49% 23,097 09/30/97 6.15% 19,509
12/31/97 2.87% 23,760 12/31/97 1.69% 19,839
03/31/98 13.95% 27,074 03/31/98 10.70% 21,961
06/30/98 3.30% 27,968 06/30/98 1.63% 22,320
09/30/98 -9.95% 25,186 09/30/98 -9.05% 20,300
12/31/98 21.30% 30,550 12/31/98 20.92% 24,546
03/31/99 4.98% 32,072 03/31/99 2.72% 25,214
06/30/99 7.05% 34,333 06/30/99 7.69% 27,154
09/30/99 -6.24% 32,189 09/30/99 -6.56% 25,372
12/31/99 14.88% 36,979 12/31/99 13.88% 28,893
03/31/00 2.29% 37,827 03/31/00 4.66% 30,240
06/30/00 -2.66% 36,822 06/30/00 -1.94% 29,653
09/30/00 -0.97% 36,465 09/30/00 -0.37% 29,542
12/31/00 -7.82% 33,612 12/31/00 -5.94% 27,786
03/31/01 -11.86% 29,627 03/31/01 -13.60% 24,007
06/30/01 5.85% 31,361 06/30/01 4.18% 25,010
09/30/01 -14.68% 26,758 09/30/01 -13.10% 21,733
12/31/01 10.69% 29,617 12/31/01 11.22% 24,171
03/31/02 0.27% 29,698 03/31/02 0.70% 24,339
06/30/02 -13.40% 25,720 06/30/02 -13.17% 21,133
09/30/02 -17.28% 21,276 09/30/02 -15.90% 17,772
12/31/02 8.44% 23,071 12/31/02 7.03% 19,022
03/31/03 -3.15% 22,345 03/31/03 -3.36% 18,384
06/30/03 15.39% 25,784 06/30/03 14.91% 21,125
09/30/03 2.65% 26,467 09/30/03 3.08% 21,776
12/31/03 12.18% 29,689 12/31/03 11.91% 24,368
03/31/04 1.69% 30,192 03/31/04 2.67% 25,019
CONSUMER PRICE INDEX:
---------------------
QTRLY
DATE RETURN BALANCE
---- ------ -------
03/31/94 10,000
06/30/94 0.60% 10,060
09/30/94 0.90% 10,151
12/31/94 0.60% 10,212
03/31/95 0.80% 10,294
06/30/95 0.90% 10,387
09/30/95 0.40% 10,428
12/31/95 0.50% 10,481
03/31/96 0.80% 10,565
06/30/96 1.10% 10,681
09/30/96 0.44% 10,728
12/31/96 0.82% 10,817
03/31/97 0.70% 10,892
06/30/97 0.19% 10,913
09/30/97 0.44% 10,960
12/31/97 0.62% 11,028
03/31/98 0.12% 11,042
06/30/98 0.56% 11,104
09/30/98 0.42% 11,150
12/31/98 0.42% 11,198
03/31/99 0.24% 11,224
06/30/99 0.91% 11,327
09/30/99 0.54% 11,388
12/31/99 0.78% 11,477
03/31/00 0.95% 11,586
06/30/00 1.00% 11,702
09/30/00 0.76% 11,790
12/31/01 0.75% 11,879
03/31/01 0.98% 11,995
06/30/01 1.08% 12,125
09/30/01 -0.11% 12,111
12/31/01 -0.06% 12,104
03/31/02 0.23% 12,132
06/30/02 1.12% 12,268
09/30/02 0.50% 12,329
12/31/02 0.33% 12,370
03/31/03 0.99% 12,492
06/30/03 0.22% 12,520
09/30/03 0.60% 12,595
12/31/03 -0.05% 12,589
03/31/04 0.92% 12,705
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for years ended March 31, 2004)
1 YEAR 5 YEARS 10 YEARS
The Government Street Equity Fund 36.09% (0.16%) 9.60%
Standard & Poor's 500 Index 35.12% (1.20%) 11.68%
Consumer Price Index 1.70% 2.51% 2.42%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
5
THE GOVERNMENT STREET MID-CAP FUND
----------------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE GOVERNMENT STREET MID-CAP
FUND, AND THE STANDARD & POOR'S MIDCAP 400 INDEX
[GRAPHIC OMITTED]
STANDARD & POOR'S MIDCAP 400 INDEX: THE GOVERNMENT STREET MID-CAP FUND:
---------------------------------- ----------------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
11/17/03 10,000 11/17/03 10,000
12/31/03 4.35% 10,435 12/31/03 2.18% 10,218
03/31/04 5.06% 10,963 03/31/04 4.55% 10,683
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Total Return(a)
(for the period ended March 31, 2004)
SINCE INCEPTION*
The Government Street Mid-Cap Fund 6.83%
Standard & Poor's MidCap 400 Index 9.63%
(a) Total return is a measure of the change in value of an investment in the
Fund over the periods covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. The return does not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
* Initial public offering of shares was November 17, 2003.
- --------------------------------------------------------------------------------
6
THE GOVERNMENT STREET BOND FUND
-------------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE GOVERNMENT STREET BOND FUND,
THE LEHMAN GOVERNMENT/CORPORATE INTERMEDIATE BOND INDEX AND THE 90-DAY TREASURY BILL INDEX
[GRAPHIC OMITTED]
LEHMAN GOVERNMENT/
CORPORATE INTERMEDIATE BOND INDEX: THE GOVERNMENT STREET BOND FUND:
---------------------------------- -------------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 10,000 03/31/94 10,000
06/30/94 -0.60% 9,940 06/30/94 -0.72% 9,928
09/30/94 0.82% 10,022 09/30/94 0.70% 9,998
12/31/94 -0.11% 10,010 12/31/94 -0.30% 9,968
03/31/95 4.39% 10,450 03/31/95 4.46% 10,412
06/30/95 5.00% 10,972 06/30/95 5.24% 10,958
09/30/95 1.66% 11,154 09/30/95 1.44% 11,115
12/31/95 3.52% 11,546 12/31/95 3.54% 11,509
03/31/96 -0.83% 11,450 03/31/96 -0.99% 11,395
06/30/96 0.63% 11,522 06/30/96 0.61% 11,464
09/30/96 1.78% 11,727 09/30/96 1.73% 11,663
12/31/96 2.45% 12,014 12/31/96 2.30% 11,931
03/31/97 -0.11% 12,001 03/31/97 -0.10% 11,919
06/30/97 2.95% 12,355 06/30/97 2.90% 12,264
09/30/97 2.70% 12,689 09/30/97 2.76% 12,603
12/31/97 2.14% 12,960 12/31/97 2.09% 12,866
03/31/98 1.56% 13,162 03/31/98 1.55% 13,065
06/30/98 1.88% 13,410 06/30/98 1.87% 13,309
09/30/98 4.49% 14,012 09/30/98 3.77% 13,811
12/31/98 0.29% 14,053 12/31/98 0.07% 13,821
03/31/99 -0.19% 14,026 03/31/99 -0.39% 13,767
06/30/99 -0.40% 13,970 06/30/99 -1.24% 13,596
09/30/99 0.92% 14,098 09/30/99 0.67% 13,688
12/31/99 0.05% 14,105 12/31/99 -0.05% 13,680
03/31/00 1.50% 14,317 03/31/00 1.31% 13,859
06/30/00 1.69% 14,559 06/30/00 1.64% 14,087
09/30/00 2.88% 14,978 09/30/00 3.09% 14,522
12/31/00 3.70% 15,532 12/31/00 3.86% 15,083
03/31/01 3.40% 16,060 03/31/01 3.14% 15,557
06/30/01 0.67% 16,168 06/30/01 0.54% 15,642
09/30/01 4.61% 16,913 09/30/01 4.29% 16,313
12/31/01 0.09% 16,929 12/31/01 -0.06% 16,304
03/31/02 -0.23% 16,890 03/31/02 0.08% 16,316
06/30/02 3.55% 17,489 06/30/02 3.02% 16,809
09/30/02 4.53% 18,281 09/30/02 3.62% 17,417
12/31/02 1.69% 18,590 12/31/02 1.40% 17,661
03/31/03 1.50% 18,869 03/31/03 1.03% 17,844
06/30/03 2.72% 19,382 06/30/03 1.77% 18,160
09/30/03 -0.02% 19,378 09/30/03 -0.15% 18,133
12/31/03 0.06% 19,390 12/31/03 0.29% 18,185
03/31/04 2.47% 19,869 03/31/04 1.40% 18,439
90-DAY TREASURY BILL INDEX:
---------------------------
QTRLY
DATE RETURN BALANCE
---- ------ -------
03/31/94 10,000
06/30/94 0.96% 10,096
09/30/94 1.08% 10,205
12/31/94 1.33% 10,340
03/31/95 1.50% 10,495
06/30/95 1.50% 10,653
09/30/95 1.42% 10,805
12/31/95 1.47% 10,964
03/31/96 1.23% 11,099
06/30/96 1.29% 11,242
09/30/96 1.38% 11,397
12/31/96 1.30% 11,545
03/31/97 1.28% 11,693
06/30/97 1.36% 11,852
09/30/97 1.34% 12,011
12/31/97 1.25% 12,161
03/31/98 1.30% 12,319
06/30/98 1.29% 12,478
09/30/98 1.42% 12,655
12/31/98 1.13% 12,797
03/31/99 1.06% 12,933
06/30/99 1.20% 13,087
09/30/99 1.27% 13,253
12/31/99 1.25% 13,418
03/31/00 1.40% 13,605
06/30/00 1.52% 13,811
09/30/00 1.51% 14,019
12/31/00 1.63% 14,248
03/31/01 1.51% 14,462
06/30/01 1.12% 14,624
09/30/01 1.08% 14,783
12/31/01 0.64% 14,877
03/31/02 0.43% 14,941
06/30/02 0.43% 15,005
09/30/02 0.43% 15,069
12/31/02 0.39% 15,128
03/31/03 0.30% 15,174
06/30/03 0.25% 15,211
09/30/03 0.24% 15,248
12/31/03 0.24% 15,285
03/31/04 0.23% 15,320
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for years ended March 31, 2004)
1 YEAR 5 YEARS 10 YEARS
The Government Street Bond Fund 3.34% 6.02% 6.31%
Lehman Government/Corporate
Intermediate Bond Index 5.30% 7.21% 7.11%
90-Day Treasury Bill Index 0.96% 3.45% 4.36%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
7
THE ALABAMA TAX FREE BOND FUND
------------------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE ALABAMA TAX FREE BOND FUND,
THE LEHMAN 7-YEAR G.O. MUNICIPAL BOND INDEX, THE LEHMAN 3-YEAR MUNICIPAL BOND INDEX AND
THE LIPPER INTERMEDIATE MUNICIPAL FUND INDEX
[GRAPHIC OMITTED]
LEHMAN 3-YEAR MUNICIPAL BOND INDEX: THE ALABAMA TAX FREE BOND FUND:
---------------------------------- ------------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 10,000 03/31/94 10,000
06/30/94 1.09% 10,109 06/30/94 0.63% 10,063
09/30/94 0.93% 10,203 09/30/94 0.54% 10,117
12/31/94 0.01% 10,204 12/31/94 -1.17% 9,999
03/31/95 2.81% 10,491 03/31/95 4.67% 10,466
06/30/95 2.12% 10,713 06/30/95 2.68% 10,746
09/30/95 2.14% 10,941 09/30/95 2.14% 10,976
12/31/95 1.54% 11,109 12/31/95 2.41% 11,241
03/31/96 0.56% 11,172 03/31/96 -0.36% 11,200
06/30/96 0.81% 11,262 06/30/96 0.26% 11,230
09/30/96 1.32% 11,411 09/30/96 1.68% 11,418
12/31/96 1.68% 11,602 12/31/96 2.16% 11,665
03/31/97 0.41% 11,650 03/31/97 -0.31% 11,628
06/30/97 1.85% 11,865 06/30/97 2.45% 11,913
09/30/97 1.71% 12,068 09/30/97 2.03% 12,156
12/31/97 1.42% 12,240 12/31/97 2.02% 12,401
03/31/98 1.03% 12,366 03/31/98 0.74% 12,494
06/30/98 1.13% 12,506 06/30/98 1.15% 12,637
09/30/98 1.98% 12,753 09/30/98 2.59% 12,965
12/31/98 0.97% 12,877 12/31/98 0.57% 13,038
03/31/99 1.11% 13,020 03/31/99 0.36% 13,085
06/30/99 -0.44% 12,962 06/30/99 -1.64% 12,871
09/30/99 1.00% 13,092 09/30/99 0.30% 12,909
12/31/99 0.29% 13,130 12/31/99 0.00% 12,910
03/31/00 1.01% 13,263 03/31/00 1.71% 13,130
06/30/00 1.39% 13,447 06/30/00 1.21% 13,289
09/30/00 1.61% 13,664 09/30/00 1.89% 13,540
12/31/00 2.09% 13,949 12/31/00 3.15% 13,967
03/31/01 2.62% 14,315 03/31/01 2.19% 14,273
06/30/01 1.21% 14,488 06/30/01 0.47% 14,340
09/30/01 2.37% 14,831 09/30/01 2.27% 14,666
12/31/01 0.24% 14,867 12/31/01 -0.61% 14,576
03/31/02 0.51% 14,943 03/31/02 0.47% 14,645
06/30/02 2.94% 15,381 06/30/02 3.39% 15,142
09/30/02 2.23% 15,724 09/30/02 3.88% 15,729
12/31/02 0.91% 15,867 12/31/02 0.47% 15,803
03/31/03 0.84% 16,001 03/31/03 0.70% 15,915
06/30/03 0.88% 16,141 06/30/03 1.95% 16,225
09/30/03 1.10% 16,319 09/30/03 0.19% 16,256
12/31/03 -0.17% 16,291 12/31/03 0.36% 16,314
03/31/04 0.93% 16,443 03/31/04 0.87% 16,456
LEHMAN 7-YEAR G.O.MUNICIPAL BOND INDEX: LIPPER INTERMEDIATE MUNICIPAL FUND INDEX:
-------------------------------------- ----------------------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
03/31/94 10,000 03/31/94 10,000
06/30/94 1.38% 10,138 06/30/94 0.92% 10,092
09/30/94 0.77% 10,216 09/30/94 0.59% 10,152
12/31/94 -1.00% 10,114 12/31/94 -1.12% 10,038
03/31/95 5.42% 10,662 03/31/95 4.98% 10,538
06/30/95 2.69% 10,948 06/30/95 2.25% 10,774
09/30/95 3.29% 11,309 09/30/95 2.40% 11,033
12/31/95 2.46% 11,587 12/31/95 2.68% 11,329
03/31/96 -0.21% 11,562 03/31/96 -0.54% 11,267
06/30/96 0.29% 11,596 06/30/96 0.44% 11,317
09/30/96 1.88% 11,814 09/30/96 1.83% 11,525
12/31/96 2.57% 12,118 12/31/96 2.20% 11,779
03/31/97 -0.15% 12,099 03/31/97 -0.02% 11,776
06/30/97 2.78% 12,436 06/30/97 2.64% 12,088
09/30/97 2.67% 12,768 09/30/97 2.45% 12,384
12/31/97 2.19% 13,047 12/31/97 2.16% 12,651
03/31/98 1.15% 13,197 03/31/98 0.96% 12,772
06/30/98 1.12% 13,345 06/30/98 1.22% 12,928
09/30/98 3.34% 13,791 09/30/98 2.78% 13,286
12/31/98 0.63% 13,878 12/31/98 0.57% 13,362
03/31/99 0.79% 13,988 03/31/99 0.56% 13,436
06/30/99 -1.64% 13,758 06/30/99 -1.67% 13,211
09/30/99 0.80% 13,868 09/30/99 0.06% 13,220
12/31/99 -0.09% 13,856 12/31/99 -0.31% 13,178
03/31/00 1.51% 14,065 03/31/00 1.76% 13,411
06/30/00 1.66% 14,298 06/30/00 1.21% 13,573
09/30/00 2.25% 14,620 09/30/00 2.09% 13,857
12/31/00 3.37% 15,113 12/31/00 3.35% 14,321
03/31/01 2.57% 15,501 03/31/01 2.26% 14,645
06/30/01 0.73% 15,614 06/30/01 0.74% 14,753
09/30/01 2.75% 16,044 09/30/01 2.59% 15,135
12/31/01 -0.93% 15,895 12/31/01 -0.84% 15,008
03/31/02 0.95% 16,046 03/31/02 0.72% 15,116
06/30/02 4.26% 16,729 06/30/02 3.54% 15,651
09/30/02 4.36% 17,458 09/30/02 3.87% 16,257
12/31/02 0.13% 17,481 12/31/02 0.02% 16,261
03/31/03 1.36% 17,719 03/31/03 0.99% 16,421
06/30/03 2.66% 18,190 06/30/03 2.20% 16,782
09/30/03 0.60% 18,299 09/30/03 0.20% 16,816
12/31/03 0.87% 18,459 12/31/03 0.91% 16,969
03/31/04 1.51% 18,737 03/31/04 1.16% 17,166
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for years ended March 31, 2004)
1 YEAR 5 YEARS 10 YEARS
The Alabama Tax Free Bond Fund 3.40% 4.69% 5.11%
Lehman 7-Year G.O. Municipal Bond Index 5.75% 6.02% 6.48%
Lehman 3-Year Municipal Bond Index 2.76% 4.78% 5.10%
Lipper Intermediate Municipal Fund Index 4.53% 5.02% 5.50%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment in the
Funds over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Funds. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
8
THE GOVERNMENT STREET FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2004
======================================================================================================
GOVERNMENT GOVERNMENT GOVERNMENT ALABAMA
STREET STREET STREET TAX FREE
EQUITY MID-CAP BOND BOND
FUND FUND FUND FUND
- ------------------------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost .................. $ 91,693,532 $ 18,932,697 $ 62,985,126 $ 36,714,170
============ ============ ============ ============
At value (Note 1) .................... $130,015,868 $ 19,342,102 $ 65,487,555 $ 38,718,173
Dividends and interest receivable ....... 144,379 12,460 687,038 423,466
Receivable for capital shares sold ...... 71,724 25,780 34,779 264,250
Other assets ............................ 2,639 1,675 1,911 2,185
------------ ------------ ------------ ------------
TOTAL ASSETS ......................... 130,234,610 19,382,017 66,211,283 39,408,074
------------ ------------ ------------ ------------
LIABILITIES
Distributions payable ................... 3,919 6,773 12,683 23,786
Payable for investment securities purchased 271,420 125,548 2,097,917 404,443
Payable for capital shares redeemed ..... 158,254 7,966 59,956 257,333
Accrued investment advisory fees (Note 3) 50,655 2,442 27,031 10,609
Accrued administration fees (Note 3) .... 12,500 4,000 4,100 4,600
Other accrued expenses .................. 19,240 8,300 4,656 5,050
------------ ------------ ------------ ------------
TOTAL LIABILITIES .................... 515,988 155,029 2,206,343 705,821
------------ ------------ ------------ ------------
NET ASSETS .............................. $129,718,622 $ 19,226,988 $ 64,004,940 $ 38,702,253
============ ============ ============ ============
Net assets consist of:
Paid-in capital ......................... $ 94,223,151 $ 18,817,511 $ 63,287,634 $ 36,812,687
Undistributed (overdistributed) net
investment income .................... 212 -- (502,180) 11,983
Accumulated net realized gains (losses)
from security transactions ........... (2,827,077) 72 (1,282,943) (126,420)
Net unrealized appreciation
on investments ....................... 38,322,336 409,405 2,502,429 2,004,003
------------ ------------ ------------ ------------
NET ASSETS .............................. $129,718,622 $ 19,226,988 $ 64,004,940 $ 38,702,253
============ ============ ============ ============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) ....................... 2,813,681 1,861,129 3,013,699 3,551,112
============ ============ ============ ============
Net asset value, offering price and
redemption price per share (Note 1) .. $ 46.10 $ 10.33 $ 21.24 $ 10.90
============ ============ ============ ============
See accompanying notes to financial statements.
9
THE GOVERNMENT STREET FUNDS
STATEMENTS OF OPERATIONS
YEAR ENDED MARCH 31, 2004(a)
======================================================================================================
GOVERNMENT GOVERNMENT GOVERNMENT ALABAMA
STREET STREET STREET TAX FREE
EQUITY MID-CAP BOND BOND
FUND FUND FUND FUND
- ------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Interest ............................. $ 31,169 $ 9,617 $ 2,669,171 $ 1,412,498
Dividends ............................ 1,750,006 59,266 -- --
------------ ------------ ------------ ------------
TOTAL INVESTMENT INCOME .......... 1,781,175 68,883 2,669,171 1,412,498
------------ ------------ ------------ ------------
EXPENSES
Investment advisory fees (Note 3) .... 670,074 42,743 306,966 126,684
Administration fees (Note 3) ......... 133,235 17,867 46,164 51,521
Custodian fees ....................... 18,555 11,331 12,249 5,800
Professional fees .................... 15,241 4,228 15,241 13,141
Trustees' fees and expenses .......... 12,252 3,700 12,252 12,252
Pricing costs ........................ 4,278 1,104 11,217 14,766
Postage and supplies ................. 9,215 2,057 6,452 6,291
Registration fees .................... 4,966 5,368 3,316 3,038
Insurance expense .................... 7,377 -- 5,236 3,458
Organization expense (Note 3) ........ -- 9,000 -- --
Printing of shareholder reports ...... 4,645 -- 2,206 1,956
Other expenses ....................... 24,762 1,225 9,131 5,480
------------ ------------ ------------ ------------
TOTAL EXPENSES ................... 904,600 98,623 430,430 244,387
Fees waived and expenses reimbursed
by the Adviser (Note 3) .......... -- (35,934) -- ( 9,117 )
------------ ------------ ------------ ------------
NET EXPENSES ..................... 904,600 62,689 430,430 235,270
------------ ------------ ------------ ------------
NET INVESTMENT INCOME ................... 876,575 6,194 2,238,741 1,177,228
------------ ------------ ------------ ------------
REALIZED AND UNREALIZED GAINS
(LOSSES) ON INVESTMENTS
Net realized gains from
security transactions ............ 137,945 626,308 246,673 35,552
Net change in unrealized appreciation/
depreciation on investments ...... 32,066,879 409,405 (504,701) (49,125)
------------ ------------ ------------ ------------
NET REALIZED AND UNREALIZED GAINS
(LOSSES) ON INVESTMENTS .............. 32,204,824 1,035,713 (258,028) (13,573)
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS ...................... $ 33,081,399 $ 1,041,907 $ 1,980,713 $ 1,163,655
============ ============ ============ ============
(a) Except for the Government Street Mid-Cap Fund, which represents the period
from the commencement of operations (November 17, 2003) through March 31,
2004.
See accompanying notes to financial statements.
10
THE GOVERNMENT STREET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
==============================================================================================
GOVERNMENT
GOVERNMENT STREET STREET
EQUITY FUND MID-CAP FUND
---------------------------------------------
YEAR YEAR PERIOD
ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004(a)
- ----------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income .................... $ 876,575 $ 700,239 $ 6,194
Net realized gains (losses) from
security transactions ................ 137,945 (2,223,200) 626,308
Net change in unrealized appreciation/
depreciation on investments .......... 32,066,879 (25,347,255) 409,405
------------ ------------ ------------
Net increase (decrease)
in net assets from operations ............ 33,081,399 (26,870,216) 1,041,907
------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ............... (880,061) (706,615) (6,194)
From realized capital gains
on security transactions ............. -- -- (626,236)
------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders ............ (880,061) (706,615) (632,430)
------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ................ 18,216,784 17,382,051 18,409,380
Net asset value of shares issued in
reinvestment of distributions
to shareholders ...................... 860,742 690,021 625,460
Payments for shares redeemed ............. (9,397,421) (8,358,649) (217,329)
------------ ------------ ------------
Net increase in net assets from
capital share transactions ........... 9,680,105 9,713,423 18,817,511
------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS ............................ 41,881,443 (17,863,408) 19,226,988
NET ASSETS
Beginning of period ...................... 87,837,179 105,700,587 --
------------ ------------ ------------
End of period ............................ $129,718,622 $ 87,837,179 $ 19,226,988
============ ============ ============
UNDISTRIBUTED NET INVESTMENT
INCOME ................................... $ 212 $ 3,698 $ --
============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ..................................... 441,342 463,686 1,821,519
Reinvested ............................... 20,271 19,604 60,561
Redeemed ................................. (221,317) (230,214) (20,951)
------------ ------------ ------------
Net increase in shares outstanding ....... 240,296 253,076 1,861,129
Shares outstanding, beginning of period .. 2,573,385 2,320,309 --
------------ ------------ ------------
Shares outstanding, end of period ........ 2,813,681 2,573,385 1,861,129
============ ============ ============
(a) Represents the period from the commencement of operations (November 17,
2003) through March 31, 2004.
See accompanying notes to financial statements.
11
THE GOVERNMENT STREET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=======================================================================================================
GOVERNMENT STREET ALABAMA TAX FREE
BOND FUND BOND FUND
-------------------------------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2004 2003 2004 2003
- -------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ................ $ 2,238,741 $ 2,630,557 $ 1,177,228 $ 1,253,434
Net realized gains from security
transactions ..................... 246,673 121,101 35,552 603
Net change in unrealized appreciation/
depreciation on investments ...... (504,701) 2,318,872 (49,125) 1,523,364
------------ ------------ ------------ ------------
Net increase in net assets from operations 1,980,713 5,070,530 1,163,655 2,777,401
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ........... (2,903,909) (2,956,335) (1,173,843) (1,246,713)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ............ 10,595,033 6,717,233 7,006,726 3,565,649
Net asset value of shares issued in
reinvestment of distributions
to shareholders .................. 2,739,667 2,799,416 869,547 880,193
Payments for shares redeemed ......... (7,071,137) (6,654,729) (3,892,384) (2,851,419)
------------ ------------ ------------ ------------
Net increase in net assets from
capital share transactions ........... 6,263,563 2,861,920 3,983,889 1,594,423
------------ ------------ ------------ ------------
TOTAL INCREASE IN NET ASSETS ............ 5,340,367 4,976,115 3,973,701 3,125,111
NET ASSETS
Beginning of year .................... 58,664,573 53,688,458 34,728,552 31,603,441
------------ ------------ ------------ ------------
End of year .......................... $ 64,004,940 $ 58,664,573 $ 38,702,253 $ 34,728,552
============ ============ ============ ============
UNDISTRIBUTED (OVERDISTRIBUTED)
NET INVESTMENT INCOME ................ $ ( 502,180) $ ( 672,701) $ 11,983 $ 33,776
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................. 495,424 314,578 641,837 332,470
Reinvested ........................... 128,622 130,931 79,823 81,647
Redeemed ............................. (332,138) (310,972) (358,193) (265,360)
------------ ------------ ------------ ------------
Net increase in shares outstanding ... 291,908 134,537 363,467 148,757
Shares outstanding, beginning of year 2,721,791 2,587,254 3,187,645 3,038,888
------------ ------------ ------------ ------------
Shares outstanding, end of year ...... 3,013,699 2,721,791 3,551,112 3,187,645
============ ============ ============ ============
See accompanying notes to financial statements.
12
THE GOVERNMENT STREET EQUITY FUND
FINANCIAL HIGHLIGHTS
========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
========================================================================================================
YEARS ENDED MARCH 31,
--------------------------------------------------------
2004 2003 2002 2001 2000
- --------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 34.13 $ 45.55 $ 45.14 $ 57.07 $ 48.10
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income .................... 0.32 0.28 0.21 0.19 0.18
Net realized and unrealized
gains (losses) on investments ........ 11.97 (11.42) 0.41 (11.93) 9.39
--------- --------- --------- --------- ---------
Total from investment operations ............ 12.29 (11.14) 0.62 (11.74) 9.57
--------- --------- --------- --------- ---------
Less distributions:
Dividends from net
investment income .................... (0.32) (0.28) (0.21) (0.19) (0.18)
Distributions from net realized gains .... -- -- -- -- (0.42)
--------- --------- --------- --------- ---------
Total distributions ......................... (0.32) (0.28) (0.21) (0.19) (0.60)
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 46.10 $ 34.13 $ 45.55 $ 45.14 $ 57.07
========= ========= ========= ========= =========
Total return (a) ............................ 36.09% (24.47%) 1.38% (20.61%) 19.93%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 129,719 $ 87,837 $ 105,701 $ 95,511 $116,447
========= ========= ========= ========= =========
Ratio of expenses to average net assets ..... 0.79% 0.81% 0.80% 0.80% 0.83%
Ratio of net investment income
to average net assets .................... 0.77% 0.76% 0.47% 0.36% 0.35%
Portfolio turnover rate ..................... 15% 12% 17% 11% 17%
(a) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
See accompanying notes to financial statements.
13
THE GOVERNMENT STREET MID-CAP FUND
FINANCIAL HIGHLIGHTS
========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD ENDED MARCH 31, 2004(a)
========================================================================================================
Net asset value at beginning of period .............................................. $ 10.00
---------
Income from investment operations:
Net investment income ............................................................ 0.01
Net realized and unrealized gains on investments ................................. 0.68
---------
Total from investment operations .................................................... 0.69
---------
Less distributions:
Dividends from net investment income ............................................. (0.01)
Distributions from net realized gains ............................................ (0.35)
---------
Total distributions ................................................................. (0.36)
---------
Net asset value at end of period .................................................... $ 10.33
=========
Total return (not annualized)(b) .................................................... 6.83%
=========
Net assets at end of period (000's) ................................................. $ 19,227
=========
Ratio of net expenses to average net assets(c) ...................................... 1.09%(d)
Ratio of net investment income to average net assets ................................ 0.11%(d)
Portfolio turnover rate ............................................................. 177%(d)
(a) Represents the period from the commencement of operations (November 17,
2003) through March 31, 2004.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
(c) Absent investment advisory fees voluntarily waived and expenses reimbursed
by the Adviser, the ratio of expenses to average net assets would have been
1.71%(d) for the period ended March 31, 2004 (Note 3).
(d) Annualized.
See accompanying notes to financial statements.
14
THE GOVERNMENT STREET BOND FUND
FINANCIAL HIGHLIGHTS
========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
========================================================================================================
YEARS ENDED MARCH 31,
--------------------------------------------------------
2004 2003 2002(a) 2001 2000
- --------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 21.55 $ 20.75 $ 20.90 $ 19.79 $ 20.90
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income .................... 0.81 0.99 1.07 1.23 1.23
Net realized and unrealized
gains (losses) on investments ........ (0.11) 0.92 (0.06) 1.11 (1.11)
--------- --------- --------- --------- ---------
Total from investment operations ............ 0.70 1.91 1.01 2.34 0.12
--------- --------- --------- --------- ---------
Dividends from net investment income ........ (1.01) (1.11) (1.16) (1.23) (1.23)
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 21.24 $ 21.55 $ 20.75 $ 20.90 $ 19.79
========= ========= ========= ========= =========
Total return (b) ............................ 3.34% 9.36% 4.88% 12.25% 0.67%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 64,005 $ 58,665 $ 53,688 $ 49,180 $ 45,156
========= ========= ========= ========= =========
Ratio of expenses to average net assets ..... 0.70% 0.71% 0.70% 0.69% 0.70%
Ratio of net investment income
to average net assets .................... 3.65% 4.62% 5.06% 6.12% 6.12%
Portfolio turnover rate ..................... 33% 39% 18% 9% 20%
(a) As required, effective April 1, 2001, the Fund adopted new provisions of
the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premiums on debt securities and recording paydown gains and
losses as adjustments to interest income. Had the Fund not adopted these
new provisions, the net investment income per share would have been $1.16
and the ratio of net investment income to average net assets would have
been 5.50%. Per share data and ratios for periods prior to April 1, 2001
have not been restated to reflect this change in presentation.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
See accompanying notes to financial statements.
15
THE ALABAMA TAX FREE BOND FUND
FINANCIAL HIGHLIGHTS
========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
========================================================================================================
YEARS ENDED MARCH 31,
--------------------------------------------------------
2004 2003 2002(a) 2001 2000
- --------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 10.89 $ 10.40 $ 10.55 $ 10.13 $ 10.54
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income .................... 0.35 0.40 0.42 0.44 0.44
Net realized and unrealized
gains (losses) on investments ........ 0.01 0.49 (0.15) 0.42 (0.41)
--------- --------- --------- --------- ---------
Total from investment operations ............ 0.36 0.89 0.27 0.86 0.03
--------- --------- --------- --------- ---------
Dividends from net investment income ........ (0.35) (0.40) (0.42) (0.44) (0.44)
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 10.90 $ 10.89 $ 10.40 $ 10.55 $ 10.13
========= ========= ========= ========= =========
Total return(b) ............................. 3.40% 8.67% 2.61% 8.71% 0.34%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 38,702 $ 34,729 $ 31,603 $ 28,091 $ 23,048
========= ========= ========= ========= =========
Ratio of net expenses to
average net assets(c) .................... 0.65% 0.65% 0.65% 0.65% 0.65%
Ratio of net investment income
to average net assets .................... 3.26% 3.74% 4.02% 4.29% 4.32%
Portfolio turnover rate ..................... 10% 9% 10% 6% 19%
(a) As required, effective April 1, 2001, the Fund adopted new provisions of
the AICPA Audit and Accounting Guide for Investment Companies and began
accreting market discount on debt securities. Had the Fund not adopted this
new provision, the ratio of net investment income to average net assets
would have been 4.00%. Per share data and ratios prior to April 1, 2001
have not been restated to reflect this change in presentation.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
(c) Absent investment advisory fees voluntarily waived by the Adviser, the
ratios of expenses to average net assets would have been 0.68%, 0.69%,
0.71%, 0.71% and 0.72% for the years ended March 31, 2004, 2003, 2002,
2001, and 2000, respectively (Note 3).
See accompanying notes to financial statements.
16
THE GOVERNMENT STREET EQUITY FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 98.9% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 11.4%
9,000 Abercrombie & Fitch Company - Class A (a) .... $ 304,560
23,000 Applebee's International, Inc. ............... 951,050
19,000 Comcast Corporation - Class A (a) ............ 546,060
15,000 Harrah's Entertainment, Inc. ................. 823,350
30,000 Hasbro, Inc. ................................. 652,500
51,500 Home Depot, Inc. ............................. 1,924,040
32,000 Johnson Controls, Inc. ....................... 1,892,800
5,500 NIKE, Inc. - Class B ......................... 428,285
5,500 Omnicom Group, Inc. .......................... 441,375
14,000 Pulte Corporation ............................ 778,400
20,000 RadioShack Corporation ....................... 663,200
28,000 Sears, Roebuck & Company ..................... 1,202,880
20,000 Target Corporation ........................... 900,800
12,000 Tribune Company .............................. 605,280
29,000 Viacom, Inc. - Class A ....................... 1,146,660
40,000 Walt Disney Company (The) .................... 999,600
14,000 Williams-Sonoma, Inc. (a) .................... 478,800
------------
14,739,640
------------
CONSUMER STAPLES -- 11.6%
33,000 Altria Group, Inc. ........................... 1,796,850
20,000 Anheuser-Busch Companies, Inc. ............... 1,020,000
20,000 Avon Products, Inc. .......................... 1,517,400
14,000 Clorox Company (The) ......................... 684,740
44,000 Coca-Cola Enterprises, Inc. .................. 1,063,480
4,260 J.M. Smucker Company (The) ................... 224,843
20,000 PepsiCo, Inc. ................................ 1,077,000
21,000 Procter & Gamble Company ..................... 2,202,480
24,500 SYSCO Corporation ............................ 956,725
24,000 Unilever N.V. - ADR .......................... 1,666,560
25,000 Walgreen Company ............................. 823,750
34,000 Wal-Mart Stores, Inc. ........................ 2,029,460
------------
15,063,288
------------
ENERGY -- 5.3%
21,314 Apache Corporation ........................... 920,125
33,082 BP PLC - ADR ................................. 1,693,799
13,000 ChevronTexaco Corporation .................... 1,141,140
11,000 ConocoPhillips ............................... 767,910
31,300 Exxon Mobil Corporation ...................... 1,301,767
24,000 Nabors Industries, Inc. (a) .................. 1,098,000
------------
6,922,741
------------
FINANCIALS -- 17.7%
35,080 Aegon N.V. - ADR ............................. 450,778
45,000 AFLAC, Inc. .................................. 1,806,300
30,000 American Express Company ..................... 1,555,500
38,500 American International Group, Inc. ........... 2,746,975
17,000 Bank of America Corporation .................. 1,376,660
35,000 BB&T Corporation ............................. 1,235,500
36,000 Charles Schwab Corporation ................... 417,960
17
THE GOVERNMENT STREET EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 98.9% (Continued) VALUE
- --------------------------------------------------------------------------------
FINANCIALS-- 17.7% (Continued)
48,833 Citigroup, Inc. .............................. $ 2,524,666
14,000 Fifth Third Bancorp .......................... 775,180
35,000 FleetBoston Financial Corporation ............ 1,571,500
14,000 Marsh & McLennan Companies, Inc. ............. 648,200
40,000 MBNA Corporation ............................. 1,105,200
14,000 Progressive Corporation ...................... 1,226,400
13,000 Saint Paul Companies, Inc. ................... 520,130
30,000 SLM Corporation .............................. 1,255,500
50,000 Synovus Financial Corporation ................ 1,222,500
75,000 U.S. Bancorp ................................. 2,073,750
9,000 Washington Mutual, Inc. ...................... 384,390
------------
22,897,089
------------
HEALTHCARE -- 15.8%
15,000 Amgen, Inc. (a) .............................. 872,550
34,000 Becton, Dickinson & Company .................. 1,648,320
31,750 Biomet, Inc. ................................. 1,217,930
41,000 Cardinal Health, Inc. ........................ 2,824,900
44,000 Elan Corporation (a) ......................... 907,280
17,000 Eli Lilly & Company .......................... 1,137,300
21,000 Forest Lab, Inc. (a) ......................... 1,504,020
11,000 Henry Schein, Inc. (a) ....................... 785,620
20,000 Johnson & Johnson ............................ 1,014,400
20,000 Medtronic, Inc. .............................. 955,000
24,900 Merck & Company, Inc. ........................ 1,100,331
63,000 Pfizer, Inc. ................................. 2,208,150
37,000 UnitedHealth Group, Inc. ..................... 2,384,280
11,000 Wellpoint Health Networks, Inc. (a) .......... 1,250,920
10,000 Zimmer Holdings, Inc. (a) .................... 737,800
------------
20,548,801
------------
INDUSTRIALS -- 10.7%
24,200 Automatic Data Processing, Inc. .............. 1,016,400
13,000 Caterpillar, Inc. ............................ 1,027,910
5,000 Deere & Company .............................. 346,550
12,500 Emerson Electric Company ..................... 749,000
14,500 Fedex Corporation ............................ 1,089,820
13,000 General Dynamics Corporation ................. 1,161,290
77,000 General Electric Company ..................... 2,350,040
3,000 Illinois Tool Works, Inc. .................... 237,690
8,000 Ingersoll-Rand Company - Class A ............. 541,200
10,000 Masco Corporation ............................ 304,300
8,000 Mueller Industries, Inc. (a) ................. 271,920
20,000 Pall Corporation ............................. 453,800
20,000 Pitney Bowes, Inc. ........................... 852,200
32,000 Quanta Services, Inc. (a) .................... 226,560
9,000 Ryder System, Inc. ........................... 348,570
53,786 Tyco International, Ltd. ..................... 1,540,969
5,000 Union Pacific Corporation .................... 299,100
7,000 United Technologies Corporation .............. 604,100
15,000 Waste Management, Inc. ....................... 452,700
------------
13,874,119
------------
18
THE GOVERNMENT STREET EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 98.9% (Continued) VALUE
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY-- 15.0%
28,000 Adaptec, Inc. (a) ............................ $ 245,280
47,000 ADC Telecommunications, Inc. (a) ............. 136,300
27,000 Adobe Systems, Inc. .......................... 1,064,610
14,979 Agilent Technologies, Inc. (a) ............... 473,786
32,000 Applied Materials, Inc. (a) .................. 684,160
17,000 Broadcom Corporation - Class A (a) ........... 665,890
15,000 Celestica, Inc. (a) .......................... 246,000
67,000 Cisco Systems, Inc. (a) ...................... 1,575,840
27,500 Computer Sciences Corporation (a) ............ 1,109,075
20,000 Dell, Inc. (a) ............................... 672,400
5,000 Electronic Arts, Inc.(a) ..................... 269,800
21,500 Electronic Data Systems Corporation .......... 416,025
14,000 First Data Corporation ....................... 590,240
16,000 Harmonic, Inc. (a) ........................... 154,400
35,000 Hewlett-Packard Company ...................... 799,400
63,100 Intel Corporation ............................ 1,716,320
10,500 International Business Machines Corporation .. 964,320
10,000 ITT Educational Services, Inc. (a) ........... 312,000
25,000 Kemet Corporation (a) ........................ 358,500
8,000 Kla-Tencor Corporation (a) ................... 402,800
29,000 Macromedia, Inc. (a) ......................... 582,030
40,000 Microsoft Corporation ........................ 998,800
20,000 Network Appliance, Inc. (a) .................. 429,000
30,000 Scientific-Atlanta, Inc. ..................... 970,200
13,500 Teradyne, Inc. (a) ........................... 321,705
31,000 Texas Instruments, Inc. ...................... 905,820
16,000 Veritas Software Corporation (a) ............. 430,560
21,000 Waters Corporation (a) ....................... 857,640
28,000 Xilinx, Inc. (a) ............................. 1,064,000
------------
19,416,901
------------
MATERIALS -- 4.5%
24,000 Alcoa, Inc. .................................. 832,560
15,000 du Pont (E.I.) de Nemours & Company .......... 633,300
5,000 Engelhard Corporation ........................ 149,450
18,000 Florida Rock Industries, Inc. ................ 758,700
22,000 General Cable Corporation .................... 162,360
7,000 Inco, Ltd.(a) ................................ 242,410
16,955 International Paper Company .................. 716,518
10,000 Newmont Mining Corporation ................... 466,300
10,000 Rayonier, Inc. ............................... 437,100
10,000 Sealed Air Corporation (a) ................... 497,300
20,000 Valspar Corporation .......................... 984,600
------------
5,880,598
------------
REAL ESTATE INVESTMENT TRUSTS-- 1.9%
27,200 Colonial Properties Trust .................... 1,109,760
40,000 Plum Creek Timber Company, Inc. .............. 1,299,200
------------
2,408,960
------------
19
THE GOVERNMENT STREET EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 98.9% (Continued) VALUE
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS SERVICES-- 2.7%
15,000 Bellsouth Corporation ........................ $ 415,350
23,000 Nextel Communications, Inc. - Class A(a) ..... 568,790
33,000 Nokia Oyj - ADR .............................. 669,240
63,000 SBC Communications, Inc. ..................... 1,546,020
35,000 Sprint Corporation (PCS Group) (a) ........... 322,000
------------
3,521,400
------------
UTILITIES -- 2.3%
68,980 Duke Energy Corporation ...................... 1,558,948
49,000 Southern Company (The) ....................... 1,494,500
------------
3,053,448
------------
TOTAL COMMON STOCKS (Cost $90,004,649) ....... $128,326,985
------------
================================================================================
PAR VALUE COMMERCIAL PAPER -- 1.3% VALUE
- --------------------------------------------------------------------------------
$1,688,000 Galaxy Funding Corporation, 0.95%, due 04/01/2004
(Cost $1,688,000) ........................... $ 1,688,000
------------
================================================================================
SHARES MONEY MARKETS -- 0.0% VALUE
- --------------------------------------------------------------------------------
883 First American Treasury Obligation Fund -
Class S (Cost $883) ......................... $ 883
------------
TOTAL INVESTMENTS AT VALUE-- 100.2%
(Cost $91,693,532) .......................... $130,015,868
LIABILITIES IN EXCESS OF OTHER ASSETS-- (0.2%) ( 297,246)
------------
NET ASSETS-- 100.0% .......................... $129,718,622
============
(a) Non-income producing security.
ADR - American Depository Receipt
See accompanying notes to financial statements.
20
THE GOVERNMENT STREET MID-CAP FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 90.7% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 15.2%
3,500 AGL Resources, Inc. .......................... $ 101,570
1,600 ArvinMeritor, Inc. ........................... 31,728
5,500 Barnes & Noble, Inc.(a) ...................... 179,300
5,100 Belo Corporation - Class A ................... 141,576
1,700 BJ's Wholesale Club, Inc.(a) ................. 43,265
1,300 BorgWarner, Inc. ............................. 110,279
1,500 Callaway Golf Company ........................ 28,470
2,400 Career Education Corporation(a) .............. 135,936
2,000 Carmax, Inc.(a) .............................. 58,400
1,700 CBRL Group, Inc. ............................. 67,388
2,000 Chico's FAS, Inc.(a) ......................... 92,800
5,000 Claire's Stores, Inc. ........................ 104,200
3,300 Coach, Inc.(a) ............................... 135,267
3,500 Education Management Corporation(a) .......... 111,405
3,100 Entercom Communications Corporation(a) ....... 140,337
1,500 Fastenal Company ............................. 80,535
2,800 Furniture Brands International, Inc. ......... 90,160
1,200 Gentex Corporation ........................... 52,056
3,300 Herman Miller, Inc. .......................... 87,879
1,000 International Speedway Corporation ........... 47,000
800 Lear Corporation ............................. 49,568
1,400 Lee Enterprises, Inc. ........................ 63,252
3,300 Mandalay Resort Group ........................ 188,958
2,200 Manpower, Inc. ............................... 102,300
1,000 Modine Manufacturing Company ................. 26,060
1,200 Mohawk Industries, Inc.(a) ................... 98,820
5,500 Ross Stores, Inc. ............................ 168,355
6,200 Ruby Tuesday, Inc. ........................... 199,330
5,000 Saks, Inc.(a) ................................ 88,000
3,200 Williams-Sonoma, Inc.(a) ..................... 109,440
------------
2,933,634
------------
CONSUMER STAPLES -- 4.7%
2,200 Church & Dwight Company, Inc. ................ 95,282
3,000 Constellation Brands, Inc.(a) ................ 96,300
2,900 Dean Foods Company(a) ........................ 96,860
4,100 Hormel Foods Corporation ..................... 120,253
2,100 J.M. Smucker Company (The) ................... 110,838
2,500 Timberland Company(a) ........................ 148,625
8,100 Tyson Foods, Inc. - Class A .................. 146,205
1,200 Whole Foods Market, Inc. ..................... 89,940
------------
904,303
------------
ENERGY -- 7.5%
4,500 Airgas, Inc. ................................. 95,850
4,200 Equitable Resources, Inc. .................... 186,564
6,000 FMC Technologies, Inc.(a) .................... 162,180
3,100 Murphy Oil Corporation ....................... 195,207
3,300 Pogo Producing Company ....................... 151,371
5,000 Pride International, Inc.(a) ................. 85,300
21
THE GOVERNMENT STREET MID-CAP FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 90.7% (Continued) VALUE
- --------------------------------------------------------------------------------
ENERGY-- 7.5% (Continued)
4,800 Scana Corporation ............................ $ 169,680
3,900 Valero Energy Corporation .................... 233,844
6,250 XTO Energy, Inc. ............................. 157,750
1,437,746
FINANCIALS -- 17.7%
1,300 American Financial Group, Inc. ............... 38,779
4,000 Amerus Group Company ......................... 161,400
4,100 Arthur J. Gallagher & Company ................ 133,537
1,900 Associated Banc-Corp ......................... 85,101
6,800 Banknorth Group, Inc. ........................ 231,472
3,000 ChoicePoint, Inc.(a) ......................... 114,090
4,100 Commerce Bancorp, Inc. ....................... 270,108
3,400 Compass Bancshares, Inc. ..................... 140,998
4,300 Eaton Vance Corporation ...................... 163,916
2,300 Everest Re Group, Ltd. ....................... 196,512
2,900 HCC Insurance Holdings, Inc. ................. 93,757
3,600 Investors Financial Services Corporation ..... 148,752
2,200 Jefferies Group, Inc. ........................ 77,726
1,900 Legg Mason, Inc. ............................. 176,282
3,800 Mercantile Bankshares Corporation ............ 163,286
5,100 National Commerce Financial Corporation ...... 145,911
7,200 New York Community Bancorp, Inc. ............. 246,816
3,600 TCF Financial Corporation .................... 183,852
4,970 Washington Federal, Inc. ..................... 126,884
4,200 Wilmington Trust Corporation ................. 156,954
2,700 WPS Resources Corporation .................... 129,060
5,400 W.R. Berkley Corporation ..................... 215,352
------------
3,400,545
------------
HEALTHCARE -- 11.3%
3,150 Barr Pharmaceuticals, Inc.(a) ................ 144,585
2,500 Charles River Laboratories International, Inc. (a) 107,125
5,600 Community Health Systems, Inc.(a) ............ 155,848
7,600 Covance, Inc.(a) ............................. 261,744
3,300 Coventry Health Care, Inc.(a) ................ 139,689
2,500 Dentsply International, Inc. ................. 110,825
3,300 Gilead Sciences, Inc.(a) ..................... 184,041
1,400 Henry Schein, Inc.(a) ........................ 99,988
1,900 Hillenbrand Industries, Inc. ................. 128,991
4,700 Mylan Laboratories, Inc. ..................... 106,831
3,200 Omnicare, Inc. ............................... 141,856
2,900 Oxford Health Plans, Inc. .................... 141,665
2,400 Pharmaceutical Resources, Inc.(a) ............ 136,464
4,800 Protein Design Labs, Inc.(a) ................. 114,336
1,900 Varian Medical Systems, Inc.(a) .............. 163,989
2,000 VISX, Inc.(a) ................................ 39,040
------------
2,177,017
------------
22
THE GOVERNMENT STREET MID-CAP FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 90.7% (Continued) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 10.1%
2,100 Alexander & Baldwin, Inc. .................... $ 69,468
3,000 Ametek, Inc. ................................. 76,920
2,200 Carlisle Companies, Inc. ..................... 124,630
2,700 C.H. Robinson Worldwide, Inc. ................ 112,050
4,000 Donaldson Company, Inc. ...................... 106,120
1,600 Energizer Holdings, Inc.(a) .................. 74,704
2,600 Expeditors International of Washington, Inc. . 102,674
3,900 Graco, Inc. .................................. 113,529
2,400 International Rectifier Corporation(a) ....... 110,376
2,500 Jacobs Engineering Group, Inc.(a) ............ 111,500
3,000 JetBlue Airways Corporation(a) ............... 75,870
2,800 Lennar Corporation - Class A ................. 151,284
6,000 Overseas Shipholding Group, Inc. ............. 219,000
1,900 Silicon Laboratories, Inc.(a) ................ 100,472
2,000 SPX Corporation .............................. 90,960
2,100 Stericycle, Inc.(a) .......................... 100,506
3,400 Swift Transportation Company, Inc.(a) ........ 58,378
2,500 Trinity Industries, Inc. ..................... 69,500
1,000 Zebra Technologies Corporation(a) ............ 69,370
------------
1,937,311
------------
INFORMATION TECHNOLOGY -- 15.0%
1,250 Activision, Inc.(a) .......................... 19,775
5,000 Acxiom Corporation ........................... 109,800
2,200 Affiliated Computer Services, Inc.(a) ........ 114,180
5,000 Arrow Electronics, Inc.(a) ................... 127,300
5,200 Ascential Software Corporation(a) ............ 113,984
1,700 CDW Corporation .............................. 114,937
4,500 Checkfree Holdings Corporation(a) ............ 132,570
4,800 Cree, Inc.(a) ................................ 107,040
2,200 Dun & Bradstreet Corporation (The)(a) ........ 117,700
1,900 Diebold, Inc. ................................ 91,428
2,700 DST Systems, Inc.(a) ......................... 122,445
2,450 Fair Isaac Corporation ....................... 88,396
3,000 Gtech Holdings Corporation ................... 177,420
2,400 Harris Corporation ........................... 116,184
5,500 Harte-Hanks, Inc. ............................ 128,810
4,000 Integrated Circuit Systems, Inc.(a) .......... 100,120
5,200 Jack Henry & Associates, Inc. ................ 100,152
2,300 L-3 Communications Holdings, Inc. ............ 136,804
4,200 Lam Research Corporation(a) .................. 105,882
3,900 Microchip Technology, Inc. ................... 103,584
3,800 National Instruments Corporation ............. 119,548
3,100 Plantronics, Inc.(a) ......................... 113,491
5,000 RSA Security, Inc.(a) ........................ 93,950
4,500 SanDisk Corporation(a) ....................... 127,665
4,600 Semtech Corporation(a) ....................... 105,018
3,300 Synopsys, Inc.(a) ............................ 95,568
------------
2,883,751
------------
23
THE GOVERNMENT STREET MID-CAP FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 90.7% (Continued) VALUE
- --------------------------------------------------------------------------------
MATERIALS -- 3.7%
2,800 Albemarle Corporation ........................ $ 81,200
3,100 Martin Marietta Materials, Inc. .............. 143,096
3,600 Potlatch Corporation ......................... 146,700
2,500 Scott's Company (The) - Class A(a) ........... 160,375
3,200 Sonoco Products Company ...................... 77,696
2,300 Valspar Corporation .......................... 113,229
------------
722,296
------------
REAL ESTATE INVESTMENT TRUSTS-- 1.5%
3,200 Liberty Property Trust ....................... 144,000
5,000 New Plan Excel Realty Trust, Inc. ............ 136,750
------------
280,750
------------
TELECOMMUNICATION SERVICES-- 1.4%
3,500 Adtran, Inc. ................................. 105,105
2,200 Telephone and Data Systems, Inc. ............. 155,914
------------
261,019
------------
UTILITIES -- 2.6%
8,300 Alliant Energy Corporation ................... 216,298
2,500 Aqua America, Inc. ........................... 54,200
1,500 Hawaiian Electric Industries, Inc. ........... 77,760
5,000 Wisconsin Energy Corporation ................. 160,750
------------
509,008
------------
TOTAL COMMON STOCKS (Cost $17,037,975) ....... $ 17,447,380
------------
================================================================================
PAR VALUE COMMERCIAL PAPER -- 9.9% VALUE
- --------------------------------------------------------------------------------
$ 950,000 Galaxy Funding Corporation, 0.95%, due 04/01/2004 $ 950,000
944,000 U.S. Bancorp, 0.95%, due 04/01/2004 .......... 944,000
------------
TOTAL COMMERICAL PAPER (Cost $1,894,000) ..... $ 1,894,000
------------
================================================================================
SHARES MONEY MARKETS -- 0.0% VALUE
- --------------------------------------------------------------------------------
722 First American Treasury Obligation Fund -
Class S (Cost $722) ....................... $ 722
------------
TOTAL INVESTMENTS AT VALUE-- 100.6%
(Cost $18,932,697) .......................... $ 19,342,102
LIABILITIES IN EXCESS OF OTHER ASSETS-- (0.6%) ( 115,114)
------------
NET ASSETS-- 100.0% .......................... $ 19,226,988
============
(a) Non-income producing security.
See accompanying notes to financial statements.
24
THE GOVERNMENT STREET BOND FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
PAR VALUE U.S. TREASURY AND AGENCY OBLIGATIONS-- 21.9% VALUE
- --------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 6.1%
$ 500,000 5.75%, due 11/15/2005 ........................ $ 534,824
925,000 5.875%, due 11/15/2005 ....................... 991,232
725,000 5.625%, due 02/15/2006 ....................... 780,224
100,000 6.625%, due 05/15/2007 ....................... 113,785
750,000 5.50%, due 02/15/2008 ........................ 837,100
100,000 5.625%, due 05/15/2008 ....................... 112,336
500,000 5.00%, due 02/15/2011 ........................ 551,953
------------
3,921,454
------------
FEDERAL FARM CREDIT BANK-- 1.4%
500,000 6.00%, due 01/07/2008 ........................ 559,611
300,000 6.28%, due 11/26/2012 ........................ 347,800
------------
907,411
------------
FEDERAL HOME LOAN BANK -- 4.4%
500,000 7.57%, due 08/19/2004 ........................ 512,370
500,000 6.045%, due 12/10/2004 ....................... 516,778
500,000 6.345%, due 11/01/2005 ....................... 537,695
200,000 5.625%, due 11/15/2011 ....................... 222,080
1,000,000 5.45%, due 01/21/2014 ........................ 1,029,296
------------
2,818,219
------------
FEDERAL HOME LOAN MORTGAGE CORPORATION-- 5.6%
1,000,000 5.125%, due 08/20/2012 ....................... 1,012,858
500,000 5.125%, due 02/20/2013 ....................... 506,567
2,000,000 6.00%, due 12/17/2018 ........................ 2,040,950
------------
3,560,375
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION-- 4.4%
500,000 6.63%, due 06/20/2005 ........................ 531,710
1,000,000 7.125%, due 03/15/2007 ....................... 1,138,718
400,000 6.80%, due 08/27/2012 ........................ 446,260
600,000 6.875%, due 09/24/2012 ....................... 671,541
------------
2,788,229
------------
TOTAL U.S. TREASURY AND AGENCY OBLIGATIONS
(Cost $13,334,830) .......................... $ 13,995,688
------------
================================================================================
PAR VALUE MORTGAGE-BACKED SECURITIES -- 26.9% VALUE
- --------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 3.3%
$2,000,000 Pool #E01173, 5.50%, due 06/01/2017 .......... $ 2,086,022
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION BONDS -- 2.4%
1,479,824 Pool #635149, 5.50%, due 07/01/2017 .......... 1,543,012
------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION-- 21.2%
2,076 Pool #15032, 7.50%, due 02/15/2007 ........... 2,232
89,600 Pool #438434, 6.50%, due 01/15/2013 .......... 95,904
526,406 Pool #498359, 6.00%, due 02/15/2014 .......... 557,666
111,076 Pool #470177, 7.00%, due 03/15/2014 .......... 119,653
25
THE GOVERNMENT STREET BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE MORTGAGE-BACKED SECURITIES -- 26.9% (Continued) VALUE
- --------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION-- 21.2% (Continued)
$ 153,865 Pool #518403, 7.00%, due 09/15/2014 .......... $ 165,746
2,572 Pool #170784, 8.00%, due 12/15/2016 .......... 2,811
1,911 Pool #181540, 8.00%, due 02/15/2017 .......... 2,089
724,059 Pool #581879, 6.50%, due 03/15/2017 .......... 775,006
1,070,403 Pool #553051, 5.50%, due 02/15/2018 .......... 1,123,132
833,106 Pool #607757, 5.50%, due 03/15/2018 .......... 874,146
1,060,248 Pool #606780, 5.50%, due 04/15/2018 .......... 1,112,477
2,203,339 Pool #610364, 5.00%, due 07/15/2018 .......... 2,280,623
88,695 Pool #493659, 6.50%, due 12/15/2018 .......... 93,642
123,476 Pool #476695, 6.50%, due 10/15/2023 .......... 130,363
108,890 Pool #366710, 6.50%, due 02/15/2024 .......... 114,963
58,598 Pool #453826, 7.25%, due 09/15/2027 .......... 62,754
140,832 Pool #412360, 7.00%, due 11/15/2027 .......... 149,986
503,100 Pool #447408, 7.00%, due 01/15/2028 .......... 535,801
44,926 Pool #454162, 7.00%, due 05/15/2028 .......... 47,846
309,072 Pool #780825, 6.50%, due 07/15/2028 .......... 326,309
97,347 Pool #2617, 7.50%, due 07/20/2028 ............ 104,289
74,799 Pool #158794, 7.00%, due 09/15/2028 .......... 79,661
73,691 Pool #486760, 6.50%, due 12/15/2028 .......... 77,801
220,090 Pool #781096, 6.50%, due 12/15/2028 .......... 232,365
220,216 Pool #781136, 7.00%, due 12/15/2028 .......... 234,530
146,134 Pool #506618, 7.00%, due 03/15/2029 .......... 155,632
803,381 Pool #536619, 6.50% due 09/15/2029 ........... 848,186
63,278 Pool #511562, 7.50%, due 07/15/2030 .......... 68,044
261,807 Pool #448316, 6.50% due 04/15/2031 ........... 276,408
160,813 Pool #530606, 6.50% due 04/15/2031 ........... 169,782
117,799 Pool #545820, 7.00% due 06/15/2031 ........... 125,456
447,272 Pool #781330, 6.00%, due 09/15/2031 .......... 467,288
288,872 Pool #3228, 6.50%, due 04/20/2032 ............ 304,173
382,186 Pool #569903, 6.50%, due 06/15/2032 .......... 403,501
929,346 Pool #595934, 6.00%, due 09/15/2032 .......... 970,935
475,041 Pool #3927, 6.00%, due 11/20/2032 ............ 496,299
------------
13,587,499
------------
TOTAL MORTGAGE-BACKED SECURITIES
(Cost $16,938,899) .......................... $ 17,216,533
------------
================================================================================
PAR VALUE CORPORATE BONDS -- 42.1% VALUE
- --------------------------------------------------------------------------------
FINANCE -- 19.3%
AmSouth Bancorp,
$ 550,000 7.75%, due 05/15/2004 ........................ $ 554,011
------------
Banc One Corporation,
665,000 7.00%, due 07/15/2005 ........................ 709,671
1,000,000 6.875%, due 08/01/2006 ....................... 1,107,769
------------
1,817,440
------------
Bank of America Corporation,
750,000 7.125%, due 03/01/2009 ....................... 877,924
------------
26
THE GOVERNMENT STREET BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE CORPORATE BONDS -- 42.1% (Continued) VALUE
- --------------------------------------------------------------------------------
FINANCE -- 19.3% (Continued)
Chase Manhattan Corporation,
$1,500,000 6.50%, due 01/15/2009 ....................... $ 1,705,101
------------
General Electric Capital Corporation,
1,500,000 5.00%, due 02/15/2007 ....................... 1,609,705
------------
International Lease Finance Corporation,
1,000,000 5.625%, due 06/01/2007 ...................... 1,090,597
------------
Marsh & McLennan Companies, Inc.,
1,050,000 6.625%, due 06/15/2004 ...................... 1,060,864
------------
Merrill Lynch & Company, Inc.,
1,000,000 7.00%, due 04/27/2008 ....................... 1,149,855
------------
NationsBank Corporation,
550,000 7.625%, due 04/15/2005 ...................... 583,789
------------
Regions Financial Corporation,
1,000,000 6.375%, due 05/15/2012 ...................... 1,133,459
------------
SouthTrust Bank of Alabama, N.A.,
665,000 7.00%, due 11/15/2008 ....................... 775,720
------------
TOTAL FINANCE CORPORATE BONDS ................ 12,358,465
------------
INDUSTRIAL -- 17.2%
Abbott Laboratories,
1,000,000 6.40%, due 12/01/2006 ....................... 1,111,349
------------
Alcoa, Inc.,
1,000,000 7.25%, due 08/01/2005 ....................... 1,073,415
------------
Anheuser Busch Companies, Inc.,
1,800,000 5.125%, due 10/01/2008 ...................... 1,944,592
------------
Cardinal Health, Inc.,
1,904,000 4.45%, due 06/30/2005 ....................... 1,965,240
------------
Coca-Cola Enterprises, Inc.,
600,000 6.625%, due 08/01/2004 ...................... 609,865
------------
Ford Motor Company,
1,000,000 7.25%, due 10/01/2008 ....................... 1,083,205
------------
General Motors Corporation,
565,000 7.10%, due 03/15/2006 ....................... 604,898
------------
27
THE GOVERNMENT STREET BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE CORPORATE BONDS -- 42.1% (Continued) VALUE
- --------------------------------------------------------------------------------
INDUSTRIAL -- 17.2% (Continued)
Wal-Mart Stores, Inc.,
$1,000,000 7.50%, due 05/15/2004 ....................... $ 1,007,153
1,500,000 4.375%, due 07/12/2007 ...................... 1,586,424
------------
2,593,577
------------
TOTAL INDUSTRIAL CORPORATE BONDS ............. 10,986,141
------------
UTILITY -- 5.6%
Alabama Power Company,
1,540,000 5.49%, due 11/01/2005 ....................... 1,627,383
------------
AT&T Corporation,
1,000,000 6.00%, due 03/15/2009 ....................... 1,078,615
------------
BellSouth Capital Funding,
750,000 7.75%, due 02/15/2010 ....................... 901,809
------------
TOTAL UTILITY CORPORATE BONDS ................ 3,607,807
------------
TOTAL CORPORATE BONDS (Cost $25,608,967) ..... $ 26,952,413
------------
================================================================================
PAR VALUE MUNICIPAL OBLIGATIONS-- 1.9% VALUE
- --------------------------------------------------------------------------------
Alabama State Public School & College Auth.,
$1,050,000 7.15%, due 09/01/2009 (Cost $1,030,973) ..... $ 1,251,464
------------
================================================================================
PAR VALUE COMMERCIAL PAPER -- 6.2% VALUE
- --------------------------------------------------------------------------------
$2,800,000 Galaxy Funding Corporation, 0.95%,
due 04/01/2004 ............................. $ 2,800,000
1,173,000 U.S. Bancorp, 0.95%, due 04/01/2004 .......... 1,173,000
------------
TOTAL COMMERICAL PAPER (Cost $3,973,000)...... $ 3,973,000
------------
================================================================================
SHARES MONEY MARKETS -- 3.3% VALUE
- --------------------------------------------------------------------------------
2,098,457 First American Treasury Obligation Fund - Class S
(Cost $2,098,457) ........................... $ 2,098,457
------------
TOTAL INVESTMENTS AT VALUE-- 102.3%
(Cost $62,985,126) .......................... $ 65,487,555
LIABILITIES IN EXCESS OF OTHER ASSETS-- (2.3%) (1,482,615)
------------
NET ASSETS-- 100.0% .......................... $ 64,004,940
============
See accompanying notes to financial statements.
28
THE ALABAMA TAX-FREE BOND FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS-- 93.9% VALUE
- --------------------------------------------------------------------------------
Alabama Mental Health Finance Auth., Special Tax,
$ 515,000 5.00%, due 05/01/2006 ........................ $ 539,184
------------
Alabama Special Care Facilities Financing Auth.,
Birmingham, Rev.,
500,000 4.50%, due 11/01/2009, ETM ................... 545,615
400,000 5.375%, due 11/01/2012, ETM .................. 427,604
------------
973,219
------------
Alabama Special Care Facilities Financing Auth.,
Mobile Hospital, Rev.,
250,000 4.50%, due 11/01/2010, ETM ................... 270,600
------------
Alabama State, GO,
500,000 3.00%, due 09/01/2007 ........................ 517,655
500,000 5.00%, due 06/01/2008 ........................ 555,645
------------
1,073,300
------------
Alabama State Municipal Electric Authority Power-
Supply, Rev.,
100,000 5.00%, due 09/01/2004 ........................ 101,625
------------
Alabama State Public School & College Auth.,
Capital Improvements, Rev.,
275,000 5.25%, due 11/01/2005 ........................ 292,278
305,000 5.00%, due 12/01/2005 ........................ 315,065
300,000 5.00%, due 02/01/2010 ........................ 335,985
305,000 5.125%, due 11/01/2010 ....................... 341,749
475,000 5.00%, due 11/01/2012 ........................ 523,569
250,000 5.625%, due 07/01/2013 ....................... 287,885
600,000 5.125%, due 11/01/2013 ....................... 668,796
525,000 5.125%, due 11/01/2015 ....................... 578,797
------------
3,344,124
------------
Alabama State Public School & College Auth., Rev.,
325,000 5.00%, due 05/01/2010 ........................ 365,310
------------
Alabama Water Pollution Control Auth., Rev.,
190,000 6.25%, due 08/15/2004 ........................ 193,625
200,000 4.65%, due 08/15/2008 ........................ 219,964
500,000 5.00%, due 08/15/2010 ........................ 563,620
180,000 5.00%, due 08/15/2015 ........................ 181,987
------------
1,159,196
------------
Anniston, AL, Regional Medical Center Hospital
Board, Rev.,
5,000 7.375%, due 07/01/2006, ETM .................. 5,342
------------
Athens, AL, School Warrants,
335,000 5.05%, due 08/01/2015 ........................ 366,463
------------
Athens, AL, Warrants,
500,000 3.00%, due 06/01/2011 ........................ 497,400
------------
29
THE ALABAMA TAX-FREE BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 93.9% (Continued) VALUE
- --------------------------------------------------------------------------------
Auburn, AL, GO,
$ 300,000 4.00%, due 08/01/2007 ........................ $ 320,118
285,000 4.25%, due 08/01/2009 ........................ 308,817
------------
628,935
------------
Auburn, AL, Water Works Board Water, Rev.,
335,000 5.00%, due 07/01/2015 ........................ 365,917
------------
Auburn University, AL, General Fee Rev.,
300,000 4.00%, due 06/01/2008 ........................ 321,255
400,000 4.45%, due 06/01/2011 ........................ 425,900
------------
747,155
------------
Baldwin Co., AL, Board of Education, Rev.,
200,000 5.20%, due 06/01/2009 ........................ 217,900
------------
Baldwin Co., AL, GO,
400,000 2.00%, due 02/01/2007 ........................ 401,900
400,000 5.00%, due 02/01/2007 ........................ 430,660
500,000 4.50%, due 11/01/2008 ........................ 548,105
200,000 4.55%, due 02/01/2009 ........................ 213,614
------------
1,594,279
------------
Birmingham, AL, GO Warrants, Series B,
300,000 3.00%, due 07/01/2006 ........................ 309,915
------------
Birmingham, AL, Industrial Water Board, Rev.,
100,000 6.00%, due 07/01/2007 ........................ 111,542
------------
Birmingham, AL, Medical Clinic Board, Rev.,
20,000 7.30%, due 07/01/2005, ETM ................... 20,881
------------
Birmingham, AL, Southern College, Private Education
Bldg. Auth., Rev.,
500,000 5.10%, due 12/01/2012 ........................ 512,810
------------
Birmingham, AL, Special Care Facilities Financing
Authority, Rev.,
200,000 5.00%, due 06/01/2006 ........................ 214,242
------------
Decatur, AL, GO,
300,000 4.00%, due 07/01/2008 ........................ 321,282
300,000 5.00%, due 06/01/2009 ........................ 325,581
------------
646,863
------------
Decatur, AL, Water Rev.,
100,000 5.00%, due 05/01/2014 ........................ 109,620
------------
Dothan, AL, GO,
400,000 5.25%, due 09/01/2010 ........................ 428,480
500,000 5.50%, due 09/01/2014 ........................ 572,075
------------
1,000,555
------------
30
THE ALABAMA TAX-FREE BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 93.9% (Continued) VALUE
- --------------------------------------------------------------------------------
Fairhope, AL, Utilities Rev.,
$ 225,000 2.50%, due 12/01/2006 ........................ $ 229,588
------------
Fairhope, AL, Warrants,
200,000 4.00%, due 06/01/2009 ........................ 214,520
295,000 5.10%, due 06/01/2014 ........................ 326,238
------------
540,758
------------
Florence, AL, Electric Rev. Warrants,
500,000 5.00%, due 06/01/2009 ........................ 559,880
------------
Florence, AL, School Warrants,
200,000 4.65%, due 12/01/2012 ........................ 215,086
400,000 5.75%, due 09/01/2015, prerefunded
09/01/2005 @ 101 ............................ 425,996
------------
641,082
------------
Foley, AL, Utilities Board, Rev.,
500,000 4.00%, due 11/01/2007 ........................ 535,535
------------
Greenville, AL, GO,
300,000 5.10%, due 12/01/2009 ........................ 329,988
------------
Homewood, AL, Board of Education, Capital
Outlay Warrants,
300,000 4.00%, due 02/01/2007 ........................ 317,916
------------
Homewood, AL, GO,
500,000 5.00%,due 09/01/2014 ......................... 549,395
------------
Hoover, AL, Board of Education, Special Tax,
300,000 3.00%, due 02/15/2006 ........................ 308,442
------------
Houston Co., AL, GO,
300,000 5.60%, due 10/15/2014 ........................ 346,248
------------
Huntsville, AL, Electric Systems, Rev.,
250,000 4.80%, due 12/01/2012 ........................ 270,798
------------
Huntsville, AL, GO,
200,000 4.50%, due 08/01/2007 ........................ 216,626
190,000 4.10%, due 11/01/2008 ........................ 204,906
300,000 5.40%, due 02/01/2010 ........................ 312,669
500,000 5.00%, due 08/01/2011 ........................ 562,635
250,000 5.25%, due 11/01/2011 ........................ 280,470
------------
1,577,306
------------
Huntsville, AL, Sewer Systems, GO Warrants, Series B,
250,000 2.50%, due 08/01/2006 ........................ 255,610
100,000 3.25%, due 11/01/2010 ........................ 102,505
------------
358,115
------------
31
THE ALABAMA TAX-FREE BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 93.9% (Continued) VALUE
- --------------------------------------------------------------------------------
Huntsville, AL, Water Systems, Rev.,
$ 300,000 4.00%, due 05/01/2005 ........................ $ 309,309
200,000 4.70%, due 11/01/2013 ........................ 212,202
------------
521,511
------------
Jefferson Co., AL, Board of Education, Capital
Outlay Warrants, Series A,
300,000 5.70%, due 02/15/2011, prerefunded
02/15/2005 @ 102 ............................ 317,967
------------
Lee Co., AL, GO,
300,000 5.50%, due 02/01/2007, prerefunded
02/01/2005 @ 102............................. 316,953
------------
Madison, AL, GO Warrants,
325,000 5.55%, due 04/01/2007 ........................ 344,656
200,000 4.40%, due 02/01/2011 ........................ 213,636
400,000 4.85%, due 02/01/2013 ........................ 433,152
------------
991,444
------------
Madison Co., AL, Board of Education, Capital
Outlay Tax Antic. Warrants,
400,000 5.20%, due 03/01/2011 ........................ 449,892
250,000 5.10%, due 09/01/2011 ........................ 267,263
------------
717,155
------------
Madison Co., AL, Water Rev.,
290,000 4.00%, due 07/01/2007 ........................ 309,476
300,000 4.00%, due 07/01/2008 ........................ 321,534
------------
631,010
------------
Mobile, AL, GO,
180,000 5.75%, due 02/15/2016, prerefunded 02/15/2006 @ 102 197,498
275,000 6.20%, due 02/15/2007, ETM ................... 308,140
------------
505,638
------------
Mobile, AL, Water & Sewer Commissioners, Rev.,
200,000 5.00%, due 01/01/2013 ........................ 204,582
------------
Mobile Co., AL, Board of School Commissioners,
Capital Outlay Warrants,
400,000 5.00%, due 03/01/2008 ........................ 409,168
------------
Mobile Co., AL, Gas Tax Antic. Warrants,
250,000 3.55%, due 02/01/2009 ........................ 260,138
------------
Mobile Co., AL, GO Warrants,
300,000 5.00%, due 02/01/2006 ........................ 319,098
200,000 5.40%, due 08/01/2013 ........................ 225,134
------------
544,232
------------
Montgomery, AL, GO,
500,000 5.10%, due 10/01/2008 ........................ 551,700
300,000 5.00%, due 11/01/2015 ........................ 327,294
------------
878,994
------------
32
THE ALABAMA TAX-FREE BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 93.9% (Continued) VALUE
- --------------------------------------------------------------------------------
Montgomery, AL, Waterworks & Sanitation, Rev.,
$ 500,000 5.00%, due 09/01/2008 ........................ $ 557,560
400,000 5.60%, due 09/01/2009 ........................ 438,540
------------
996,100
------------
Montgomery Co., AL, GO,
300,000 3.00%, due 11/01/2006 ........................ 310,764
------------
Mountain Brook, AL, City Board of Education,
Capital Outlay Warrants,
405,000 4.80%, due 02/15/2011 ........................ 424,327
------------
Muscle Shoals, AL, GO,
400,000 5.60%, due 08/01/2010 ........................ 434,664
------------
Opelika, AL, GO,
500,000 5.00%, due 04/01/2006 ........................ 534,150
200,000 4.00%, due 03/01/2008 ........................ 214,214
210,000 4.00%, due 03/01/2010 ........................ 225,355
------------
973,719
------------
Scottsboro, AL, Waterworks Sewer & Gas Board, Rev.,
200,000 4.35%, due 08/01/2011 ........................ 212,242
------------
Shelby Co., AL, Board of Education, GO Warrants,
315,000 4.75%, due 02/01/2009 ........................ 346,960
------------
Shelby Co., AL, Board of Education, Rev. Warrants,
500,000 4.80%, due 02/01/2011 ........................ 542,595
------------
Trussville, AL, GO Warrants,
400,000 4.30%, due 10/01/2010 ........................ 434,640
------------
Tuscaloosa, AL, Board of Education, GO,
300,000 4.625%, due 08/01/2008 ....................... 314,895
------------
Tuscaloosa, AL, Board of Education, Special Tax Warrants,
300,000 4.85%, due 02/15/2013 ........................ 319,080
------------
Tuscaloosa, AL, GO Warrants,
145,000 4.25%, due 02/01/2011 ........................ 156,063
500,000 5.45%, due 01/01/2014 ........................ 566,575
------------
722,638
------------
Tuscaloosa Co., AL, GO Warrants,
425,000 4.30%, due 10/01/2009 ........................ 463,628
------------
33
THE ALABAMA TAX-FREE BOND FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 93.9% (Continued) VALUE
- -------------------------------------------------------------------------------
University of Alabama, Rev.,
$ 400,000 5.25%, due 06/01/2010 ........................ $ 436,224
100,000 5.25%, due 10/01/2010 ........................ 112,571
100,000 5.375%, due 06/01/2013 ....................... 109,320
400,000 5.00%, due 10/01/2014 ........................ 409,056
------------
1,067,171
------------
Vestavia Hills, AL, Warrants,
125,000 4.90%, due 04/01/2005 ........................ 127,500
565,000 5.00%, due 02/01/2012 ........................ 632,122
------------
759,622
------------
TOTAL ALABAMA FIXED RATE REVENUE AND GENERAL
OBLIGATION (GO) BONDS (Cost $34,359,262) .... $ 36,363,265
------------
================================================================================
SHARES MONEY MARKETS -- 6.1% VALUE
- --------------------------------------------------------------------------------
2,354,908 First American Tax-Free Obligation Fund -
Class S (Cost $2,354,908) .................... $ 2,354,908
------------
TOTAL INVESTMENTS AT VALUE-- 100.0%
(Cost $36,714,170) ........................... $ 38,718,173
LIABILITIES IN EXCESS OF OTHER ASSETS-- (0.0%). ( 15,920)
------------
NET ASSETS-- 100.0% ........................... $ 38,702,253
============
ETM - Escrowed to maturity.
See accompanying notes to financial statements.
34
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Government Street Equity Fund, The Government Street Mid-Cap Fund, The
Government Street Bond Fund and The Alabama Tax Free Bond Fund (the Funds) are
each a no-load series of the Williamsburg Investment Trust (the Trust). The
Trust, an open-end management investment company registered under the Investment
Company Act of 1940, was organized as a Massachusetts business trust on July 18,
1988.
The Government Street Equity Fund's investment objective is to seek capital
appreciation through the compounding of dividends and capital gains, both
realized and unrealized, by investing in common stocks.
The Government Street Mid-Cap Fund's investment objective is to seek capital
appreciation by investing in common stocks of mid-cap companies.
The Government Street Bond Fund's investment objectives are to preserve capital,
to provide current income and to protect the value of the portfolio against the
effects of inflation.
The Alabama Tax Free Bond Fund's investment objectives are to provide current
income exempt from federal income taxes and from the personal income taxes of
Alabama and to preserve capital.
The following is a summary of the Funds' significant accounting policies:
Securities valuation -- The Funds' portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities which are traded over-the-counter
are valued at the last sales price, if available, otherwise, at the last quoted
bid price. Securities traded on a national stock exchange are valued based upon
the closing price on the principal exchange where the security is traded.
Securities which are quoted by NASDAQ are valued at the NASDAQ Official Closing
Price. It is expected that fixed income securities will ordinarily be traded in
the over-the-counter market, and common stocks will ordinarily be traded on a
national securities exchange, but may also be traded in the over-the-counter
market. When market quotations are not readily available, fixed income
securities may be valued on the basis of prices provided by an independent
pricing service. Short-term instruments (those with remaining maturities of 60
days or less) are valued at amortized cost, which approximates market value.
Securities and other assets for which no quotations are readily available will
be valued in good faith at fair value using methods determined by the Board of
Trustees. Such methods of fair valuation may include, but are not limited to:
multiple of earnings, multiple of book value, discount from market of a similar
freely traded security, purchase price of security, subsequent private
transactions in the security or related securities, or a combination of these
and other factors.
Repurchase agreements -- The Funds may enter into joint repurchase agreements
with other funds within the Trust. The joint repurchase agreement, which is
collateralized by U.S. Government obligations, is valued
35
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004 (CONTINUED)
================================================================================
at cost which, together with accrued interest, approximates market value. At the
time the Funds enter into the joint repurchase agreement, the Funds take
possession of the underlying securities and the seller agrees that the value of
the underlying securities, including accrued interest, will at all times be
equal to or exceed the face amount of the repurchase agreement. In addition,
each Fund actively monitors and seeks additional collateral, as needed.
Share valuation -- The net asset value per share of each Fund is calculated
daily by dividing the total value of each Fund's assets, less liabilities, by
the number of shares outstanding. The offering price and redemption price per
share of each Fund is equal to the net asset value per share.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed-income
securities purchased are amortized using the interest method.
Distributions to shareholders -- Dividends arising from net investment income
are declared and paid quarterly to shareholders of The Government Street Equity
Fund; declared and paid annually to shareholders of The Government Street
Mid-Cap Fund; declared and paid monthly to shareholders of The Government Street
Bond Fund; and declared daily and paid monthly to shareholders of The Alabama
Tax Free Bond Fund. Net realized short-term capital gains, if any, may be
distributed throughout the year and net realized long-term capital gains, if
any, are distributed at least once each year. The amount of distributions from
net investment income and net realized gains are determined in accordance with
federal income tax regulations which may differ from accounting principles
generally accepted in the United States. These "book/tax" differences are either
temporary or permanent in nature. The tax character of distributions paid during
the periods ended March 31, 2004 and 2003 are as follows:
- -----------------------------------------------------------------------------------------------------
PERIODS ENDED ORDINARY EXEMPT-INTEREST TOTAL
MARCH 31, INCOME DIVIDENDS DISTRIBUTIONS
- -----------------------------------------------------------------------------------------------------
Government Street Equity Fund .... 2004 $ 880,061 $ -- $ 880,061
2003 $ 706,615 $ -- $ 706,615
- -----------------------------------------------------------------------------------------------------
Government Street Mid-Cap Fund ... 2004 $ 632,430 $ -- $ 632,430
- -----------------------------------------------------------------------------------------------------
Government Street Bond Fund ...... 2004 $ 2,903,909 $ -- $ 2,903,909
2003 $ 2,956,335 $ -- $ 2,956,335
- -----------------------------------------------------------------------------------------------------
Alabama Tax Free Bond Fund ....... 2004 $ -- $ 1,173,843 $ 1,173,843
2003 $ -- $ 1,246,713 $ 1,246,713
- -----------------------------------------------------------------------------------------------------
Security transactions -- Security transactions are accounted for on trade date.
Cost of securities sold is determined on a specific identification basis.
Common expenses -- Common expenses of the Trust are allocated among the funds of
the Trust based on relative net assets of each fund or the nature of the
services performed and the relative applicability to each fund.
36
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004 (CONTINUED)
================================================================================
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of income and expenses during the reporting period. Actual results could
differ from those estimates.
Federal income tax -- It is each Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which a Fund so
qualifies, and distributes at least 90% of its taxable net income, the Fund (but
not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is computed on a tax basis for each item as of March
31, 2004:
- ------------------------------------------------------------------------------------------------------
Government Government Government Alabama
Street Street Street Tax Free
Equity Mid-Cap Bond Bond
Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------
Cost of portfolio investments ........... $ 91,693,532 $ 18,932,697 $ 63,490,150 $ 36,771,740
============ ============ ============ ============
Gross unrealized appreciation ........... $ 44,669,269 $ 830,651 $ 2,280,733 $ 1,961,908
Gross unrealized depreciation ........... (6,346,933) (421,246) (283,327) (15,475)
------------ ------------ ------------ ------------
Net unrealized appreciation ............. $ 38,322,336 $ 409,405 $ 1,997,406 $ 1,946,433
Undistributed ordinary income ........... 4,131 6,845 15,526 23,786
Capital loss carryforwards .............. (2,307,057) -- (1,153,037) (56,867)
Post-October losses ..................... (520,020) -- (129,906) --
Other temporary differences ............. (3,919) (6,773) (12,683) (23,786)
------------ ------------ ------------ ------------
Total distributable earnings ............ $ 35,495,471 $ 409,477 $ 717,306 $ 1,889,566
============ ============ ============ ============
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for The Government Street Bond Fund and The Alabama
Tax Free Bond Fund is due to certain timing differences in the recognition of
capital gains or losses under income tax regulations and accounting principles
generally accepted in the United States. These "book/tax" differences are either
temporary or permanent in nature and are primarily due to the tax deferral of
losses on wash sales and/or differing methods in the amortization of discounts
and premiums on fixed income securities.
37
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004 (CONTINUED)
================================================================================
As of March 31, 2004, the Funds had the following capital loss carryforwards for
federal income tax purposes:
- --------------------------------------------------------------------------------
EXPIRES
AMOUNT MARCH 31,
- --------------------------------------------------------------------------------
Government Street Equity Fund $ 2,307,057 2011
------------
$ 2,307,057
============
- --------------------------------------------------------------------------------
Government Street Bond Fund $ 129,539 2005
126,569 2006
106,011 2007
220,187 2008
195,097 2009
86,819 2010
70,419 2011
218,396 2012
------------
$ 1,153,037
============
- --------------------------------------------------------------------------------
Alabama Tax Free Bond Fund $ 347 2007
56,520 2009
------------
$ 56,867
============
- --------------------------------------------------------------------------------
These capital loss carryforwards may be utilized in future years to offset net
realized capital gains, if any, prior to distribution to shareholders.
In addition, The Government Street Equity Fund and The Government Street Bond
Fund had net realized capital losses of $520,020 and $129,906, respectively,
during the period November 1, 2003 through March 31, 2004, which are treated for
federal income tax purposes as arising during the Funds' tax year ending March
31, 2005. These "post-October" losses may be utilized in future years to offset
net realized capital gains prior to distributing such gains to shareholders.
For the year ended March 31, 2004, The Government Street Bond Fund reclassified
$835,689 of overdistributed net investment income against accumulated net
realized gains and The Alabama Tax Free Bond Fund reclassified $25,178 of
undistributed net investment income against accumulated net realized losses on
the Statement of Assets and Liabilities due to permanent differences in the
recognition of capital gains or losses under income tax regulations and
accounting principles generally accepted in the United States.
For the year ended March 31, 2004, The Government Street Bond Fund and The
Alabama Tax Free Bond Fund reclassified accumulated net realized losses of
$106,397 and $58,788, respectively, against paid-in-capital on the Statement of
Assets and Liabilities due to the expiration of capital loss carryforwards. Such
reclassifications had no effect on the Funds' nets assets or net asset value per
share.
38
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004 (CONTINUED)
================================================================================
2. INVESTMENT TRANSACTIONS
During the period ended March 31, 2004, cost of purchases and proceeds from
sales and maturities of investment securities, other than short-term investments
and U.S. government securities, amounted to $27,766,817 and $16,934,942,
respectively, for The Government Street Equity Fund; $25,480,004 and $9,068,337,
respectively, for The Government Street Mid-Cap Fund; $19,774,430 and
$15,883,451, respectively, for The Government Street Bond Fund; and $6,016,771
and $3,531,750, respectively, for The Alabama Tax Free Bond Fund.
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Funds' investments are managed by T. Leavell & Associates, Inc. (the
Adviser) under the terms of an Investment Advisory Agreement. Under the
Investment Advisory Agreement, The Government Street Equity Fund pays the
Adviser a fee, which is computed and accrued daily and paid monthly, at an
annual rate of .60% of its average daily net assets up to $100 million and .50%
of such assets in excess of $100 million. The Government Street Mid-Cap Fund
pays the Adviser a fee at an annual rate of .75% of its average daily net
assets. The Government Street Bond Fund pays the Adviser a fee at an annual rate
of .50% of its average daily net assets up to $100 million and .40% of such net
assets in excess of $100 million. The Alabama Tax Free Bond Fund pays the
Adviser a fee at an annual rate of .35% of its average daily net assets up to
$100 million and .25% of such net assets in excess of $100 million.
The Adviser currently intends to limit the total operating expenses of The
Government Street Mid-Cap Fund and The Alabama Tax Free Bond Fund to 1.10% and
..65%, respectively, of each Fund's average daily net assets. Accordingly, the
Adviser voluntarily waived $21,477 and $9,117, respectively, of its investment
advisory fees from The Government Street Mid-Cap Fund and The Alabama Tax Free
Bond Fund during the period ended March 31, 2004. Additionally, the Adviser
reimbursed The Government Street Mid-Cap Fund for other expenses in the amount
of $14,457.
Certain Trustees and officers of the Trust are also officers of the Adviser.
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Funds. For these services, Ultimus receives a monthly fee from
The Government Street Equity Fund, The Government Street Mid-Cap Fund and The
Alabama Tax Free Bond Fund at an annual rate of .15% of each Fund's average
daily net assets up to $25 million; .125% of the next $25 million of such
assets; and .10% of such net assets in excess of $50 million. Additionally, The
Government Street Mid-Cap Fund is subject to a minimun monthly fee of $4,000.
From The
39
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004 (CONTINUED)
================================================================================
Government Street Bond Fund, Ultimus receives a monthly fee at an annual rate of
..075% of the Fund's average daily net assets up to $200 million and .05% of such
assets in excess of $200 million. In addition, each Fund pays out-of-pocket
expenses including, but not limited to, postage, supplies and costs of pricing
the Funds' portfolio securities. During the period ended March 31, 2004, The
Government Street Mid-Cap Fund paid $9,000 to Ultimus in connection with the
organization of the Fund.
Certain officers of the Trust are also officers of Ultimus, or of Ultimus Fund
Distributors, LLC, the principal underwriter of each Fund's shares and an
affiliate of Ultimus.
4. CONTINGENCIES AND COMMITMENTS
The Funds indemnify the Trust's officers and trustees for certain liabilities
that might arise from their performance of their duties to the Funds.
Additionally, in the normal course of business the Funds enter into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Funds' maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Funds that have not yet occurred. However, based on experience, the Funds expect
the risk of loss to be remote.
40
REPORT OF INDEPENDENT AUDITORS
================================================================================
To the Board of Trustees and Shareholders of
The Government Street Equity Fund, The Government Street Mid-Cap Fund,
The Government Street Bond Fund, and The Alabama Tax-Free Bond Fund
of the Williamsburg Investment Trust
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of The Government Street Equity Fund,
The Government Street Mid-Cap Fund, The Government Street Bond Fund, and The
Alabama Tax Free Bond Fund (the "Funds") (each a series of Williamsburg
Investment Trust) as of March 31, 2004, and the related statements of operations
and changes in net assets and financial highlights for the year then ended,
except for The Government Street Mid-Cap Fund which is for the period November
17, 2003 (commencement of operations) through March 31, 2004. 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. The statements of
changes in net assets and financial highlights for the respective years ended
March 31, 2003 were audited by other auditors. Those auditors expressed an
unqualified opinion on the statements of changes in net assets and financial
highlights in their report dated April 25, 2003.
We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the financial statements
and financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of March 31, 2004, by correspondence with the custodian and brokers or
by other appropriate auditing procedures where replies from brokers were not
received. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial positions of
The Government Street Equity Fund, The Government Street Mid-Cap Fund, The
Government Street Bond Fund, and The Alabama Tax Free Bond Fund as of March 31,
2004, the results of their operations, the changes in their net assets and their
financial highlights for the year then ended, except for The Government Street
Mid-Cap Fund which is for the period November 17, 2003 through March 31, 2004,
in conformity with accounting principles generally accepted in the United
States.
/s/ Ernst & Young LLP
Cincinnati, Ohio
May 6, 2004
41
BOARD OF TRUSTEES AND EXECUTIVE
OFFICERS (UNAUDITED)
================================================================================
Overall responsibility for management of the Funds rests with the Board of
Trustees. The Trustees serve during the lifetime of the Trust and until its
termination, or until death, resignation, retirement or removal. The Trustees,
in turn, elect the officers of the Funds to actively supervise the day-to-day
operations. The officers have been elected for an annual term. The following are
the Trustees and executive officers of the Funds:
POSITION HELD LENGTH OF
TRUSTEE ADDRESS AGE WITH THE TRUST TIME SERVED
- -----------------------------------------------------------------------------------------------------------------
*Charles M. Caravati, Jr. 931 Broad Street Road, 67 Chairman and Since
Manakin-Sabot, VA Trustee June 1991
- -----------------------------------------------------------------------------------------------------------------
*Austin Brockenbrough III 1802 Bayberry Court, 67 Trustee Since
Suite 400 September 1988
Richmond, VA
- -----------------------------------------------------------------------------------------------------------------
*John T. Bruce 800 Main Street 50 Trustee Since
Lynchburg, VA September 1988
- -----------------------------------------------------------------------------------------------------------------
J. Finley Lee 200 Westminster Drive 64 Trustee Since
Chapel Hill, NC September 1988
- -----------------------------------------------------------------------------------------------------------------
*Richard Mitchell 150 Government Street 54 Trustee and Since
Mobile, AL President June 1991
- -----------------------------------------------------------------------------------------------------------------
Richard L. Morrill University of Richmond 64 Trustee Since
Richmond, VA March 1993
- -----------------------------------------------------------------------------------------------------------------
Harris V. Morrissette 100 Jacintoport Boulevard 44 Trustee Since
Saraland, AL March 1993
- -----------------------------------------------------------------------------------------------------------------
Erwin H. Will, Jr. 47 Willway Avenue 71 Trustee Since
Richmond, VA July 1997
- -----------------------------------------------------------------------------------------------------------------
Samuel B. Witt III 2300 Clarendon Boulevard 68 Trustee Since
Suite 407 November 1988
Arlington, VA
- -----------------------------------------------------------------------------------------------------------------
Thomas W. Leavell 150 Government Street 60 Vice President Since
Mobile, AL of The Government February 2004
Street Equity Fund
and The Government
Street Mid-Cap Fund
- -----------------------------------------------------------------------------------------------------------------
Mary Shannon Hope 150 Government Street 40 Vice President of Since
Mobile, AL The Government February 2004
Street Bond Fund
- -----------------------------------------------------------------------------------------------------------------
Timothy S. Healey 600 Luckie Drive 51 Vice President of Since
Suite 305 The Alabama Tax January 1995
Birmingham, AL Free Bond Fund and
The Government
Street Mid-Cap Fund
- -----------------------------------------------------------------------------------------------------------------
Robert G. Dorsey 135 Merchant Street 47 Vice President Since
Suite 230 November 2000
Cincinnati, OH
- -----------------------------------------------------------------------------------------------------------------
Mark J. Seger 135 Merchant Street 42 Treasurer Since
Suite 230 November 2000
Cincinnati, OH
- -----------------------------------------------------------------------------------------------------------------
John F. Splain 135 Merchant Street 47 Secretary Since
Suite 230 November 2000
Cincinnati, OH
42
BOARD OF TRUSTEES AND EXECUTIVE
OFFICERS (UNAUDITED) (CONTINUED)
================================================================================
*Messrs. Bruce, Brockenbrough, Caravati and Mitchell are "interested persons" of
the Trust within the meaning of Section 2(a)(19) of the Investment Company Act
of 1940. Charles M. Caravati, Jr. is the father of Charles M. Caravati III, an
officer of The Jamestown Funds, which are other portfolios of the Trust.
Each Trustee oversees eleven portfolios of the Trust, including the Funds. The
principal occupations of the Trustees and executive officers of the Funds during
the past five years and public directorships held by the Trustees are set forth
below:
Charles M. Caravati, Jr. is a retired physician. He is also the retired
President of Dermatology Associates of Virginia, P.C.
Austin Brockenbrough III is President and Managing Director of Lowe,
Brockenbrough & Company, Inc. (an investment advisory firm). He is a member of
the Board of Directors of Tredegar Corporation (a plastics manufacturer) and
Wilkinson O'Grady & Co., Inc. (a global asset manager). In addition, he is a
member of the Board of Trustees for the University of Richmond.
John T. Bruce is a Principal of Flippin, Bruce & Porter, Inc. (an investment
advisory firm).
J. Finley Lee is a financial consultant and the Julian Price Professor Emeritus
at the University of North Carolina. Richard Mitchell is a Principal of the
Adviser.
Richard L. Morrill is the Chancellor of the University of Richmond. He is also a
member of the Board of Directors of Tredegar Corporation and Albemarle
Corporation (polymers and chemical manufacturer).
Harris V. Morrissette is President of Marshall Biscuit Co., Inc. He is a member
of the Board of Directors of BancTrust Financial Group, Inc. (a bank holding
company) and EnergySouth, Inc. In addition, he is Chairman of Azalea Aviation,
Inc. (an airplane fueling company).
Erwin H. Will, Jr. is the retired Managing Director of Equities of Virginia
Retirement System.
Samuel B. Witt III is Senior Vice President and General Counsel of Stateside
Associates, Inc. He is also a member of the Board of Directors of The Swiss
Helvetia Fund, Inc. (a closed-end investment company).
Thomas W. Leavell is a Principal of the Adviser.
Mary Shannon Hope is a Principal of the Adviser.
Timothy S. Healey is a Principal of the Adviser.
43
BOARD OF TRUSTEES AND EXECUTIVE
OFFICERS (UNAUDITED) (CONTINUED)
================================================================================
Robert G. Dorsey is a Managing Director of Ultimus Fund Solutions, LLC and
Ultimus Fund Distributors, LLC.
Mark J. Seger is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
John F. Splain is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
Additional information about members of the Board of Trustees and executive
officers is available in the Statement of Additional Information (SAI). To
obtain a free copy of the SAI, please call 1-800-281-3217.
FEDERAL TAX INFORMATION (UNAUDITED)
================================================================================
For the fiscal year ended March 31, 2004 certain dividends paid by The
Government Street Equity Fund, The Government Street Mid-Cap Fund and The
Government Street Bond Fund may be subject to a maximum tax rate of 15%, as
provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The
Funds intend to designate up to a maximum amount of $880,061, $632,430 and
$2,903,909, respectively, as taxed at a maximum rate of 15%. Additionally, for
the fiscal year ended March 31, 2004, 100% of the dividends paid from ordinary
income by The Governent Street Equity Fund and The Government Street Mid-Cap
Fund qualified for the dividends received deduction for corporations. Complete
information will be computed and reported in conjunction with your 2004 Form
1099-DIV.
CHANGE IN INDEPENDENT AUDITOR (UNAUDITED)
================================================================================
On February 17, 2004, Tait, Weller & Baker was replaced as independent auditor
of the Funds, and Ernst & Young LLP (Ernst & Young) was selected as the Funds'
new independent auditor. The Funds' selection of Ernst & Young as its
independent auditor was recommended and approved by the Funds' audit committee
and was ratified by the Board of Trustees.
Tait, Weller & Baker's reports on the Funds' financial statements for the prior
two fiscal years did not contain an adverse opinion or a disclaimer of opinion,
and were not qualified or modified as to uncertainty, audit scope or accounting
principles. During such fiscal years, and through the date of Tait, Weller &
Baker's replacement, there were no disagreements between the Funds and Tait,
Weller & Baker on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedures, which disagreements, if
not resolved to the satisfaction of Tait, Weller & Baker, would have caused it
to make reference to the subject matter of the disagreements in connection with
its reports on the financial statements for such years.
44
This page intentionally left blank.
THE GOVERNMENT STREET FUNDS
-------------------------------
NO LOAD MUTUAL FUNDS
INVESTMENT ADVISER
T. Leavell & Associates, Inc.
150 Government Street
Post Office Box 1307
Mobile, AL 36633
ADMINISTRATOR
Ultimus Fund Solutions, LLC
P.O. Box 46707
Cincinnati, OH 45246-0707
1-866-738-1125
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, MA 02109
BOARD OF TRUSTEES
Richard Mitchell, President
Austin Brockenbrough, III
John T. Bruce
Charles M. Caravati, Jr.
J. Finley Lee, Jr.
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr.
Samuel B. Witt, III
PORTFOLIO MANAGERS
Thomas W. Leavell,
The Government Street Equity Fund
The Government Street Mid-Cap Fund
Timothy S. Healey,
The Government Street Mid-Cap Fund
The Alabama Tax Free Bond Fund
Mary Shannon Hope,
The Government Street Bond Fund
A description of the policies and procedures that the Funds use to vote proxies
relating to portfolio securities is available without charge upon request by
calling toll-free 1-866-738-1125, or on the Securities and Exchange Commission's
website at http://www.sec.gov.
================================================================================
- --------------------------------------------------------------------------------
THE DAVENPORT EQUITY FUND
INVESTMENT ADVISER
Davenport & Company LLC
One James Center
901 East Cary Street
Richmond, Virginia 23219-4037
ADMINISTRATOR ---------------
Ultimus Fund Solutions, LLC DAVENPORT
P.O. Box 46707 EQUITY FUND
Cincinnati, Ohio 45246-0707 -----------
1-800-281-3217 ---------------
CUSTODIAN
U.S. Bank
425 Walnut Street
Cincinnati, Ohio 45202
INDEPENDENT AUDITORS
Tait, Weller & Baker
1818 Market Street, Suite 2400
Philadelphia, Pennsylvania 19103
ANNUAL REPORT
LEGAL COUNSEL March 31, 2004
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
BOARD OF TRUSTEES
Austin Brockenbrough III
John T. Bruce
Charles M. Caravati, Jr.
J. Finley Lee, Jr.
Richard Mitchell
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr. ---------------
Samuel B. Witt III
---------------
OFFICERS
Joseph L. Antrim III, President
J. Lee Keiger III, Vice President
John P. Ackerly IV, Vice President
A description of the policies and procedures that the Fund uses to vote proxies
relating to portfolio securities is available without charge upon request by
calling toll-free 1-800-281-3217, or on the Securities and Exchange Commission's
website at http://www.sec.gov.
- --------------------------------------------------------------------------------
================================================================================
LETTER TO SHAREHOLDERS MARCH 31, 2004
WHAT A DIFFERENCE
What a difference six weeks make. Back in mid-February, stocks were moving
firmly ahead, building on the solid gains of last year. Greenspan was quoted as
saying "prospects are good for sustained expansion of the U.S. economy." There
was a $66 billion unsolicited bid for Disney from Comcast. Good corporate
earnings growth and continued very low interest rates made stocks look
attractively valued. Momentum was strong. The expanding economy and low rates
combined with ample cash available for stocks highlighted the prospects for a
bright future. Profit margins were nearing all time highs due largely to
continued productivity gains. Finally, there was a rotation under way from the
higher volatility market groups that had led gains in 2003 to the more
defensive, lower risk sectors. This rotation added a note of sustainability to
the rally.
The glass was half-full and getting fuller by the day. After all, an election
year is almost always good for the market. In hindsight, there seemed to be
almost too much good news.
Now we have had a correction of 5% or more. Positive momentum has given way to
uncertainty. Is this a normal technical retreat or are more fundamental factors
at work? As with most questions regarding the market, an answer is elusive. No
matter what the answer turns out to be, investor sentiment does seem a bit
different. We are reminded of a Buffalo Springfield song recently quoted by Eric
Savitz in Barron's: "Something's happenin' here. What it is, ain't exactly
clear."
Oil is now priced at $38 and could slow economic growth, although recently,
energy prices have backed off a bit. Terrorism fears abound, fueled by the train
bombings in Madrid. The assassination of the spiritual leader of Hamas points to
continued strife between the Israelis and Palestinians. Turmoil and daily deaths
still plague Iraq and possible unrest looms in Pakistan. The Bush Administration
is under attack and poll numbers have weakened. All this, in the absence of any
solid, positive fundamental news on the U.S. economy, could be the reason for
the correction.
We are entering the season for first quarter earnings reports. Here are some
straws in the wind that could affect these earnings releases as well as color
the climate in which investors receive them. The economy and employment levels
may finally be moving decisively ahead. There is strength in Europe; not across
the board, but strength does seem to be the norm rather than the exception.
Wal-Mart's same store sales have recently been reported near the high end of
expectations. While the bar may have been raised regarding expectations on the
quarterly reports, we suspect there is more good than bad news. It could be that
the geo-political events of the recent past will look more like an excuse for a
technical correction than a fundamental reason for a new bear market. We remain
optimistic about 2004. While this year may not turn out to be as good as 2003,
we continue to feel investors will be rewarded through well diversified stock
portfolios.
One investment theme we have been looking into recently focuses on baby boomers.
These folks have passed their 40th birthday and some are approaching 60. While
their life expectancy has never been higher, their expectations for the way they
look and feel as they age have also never been higher. Many boomers feel they
should be able to live their lives very much in the same fashion as they did in
their 20's and 30's. They also believe they should look like they did then.
Finally, many have accumulated the wealth to try, often with the help of a
physician and a personal trainer.
1
The healthcare industry is an obvious beneficiary of this trend. However, the
increasing pressure on pharmaceutical companies to control pricing impacts
negatively on the performance of these stocks. Orthopedic implants are right at
the heart of this phenomenon and so far have escaped pricing pressures. Also,
there are myriad cosmetic products that purport to make us look and, hopefully,
feel younger which are also beneficiaries. Weight loss, skincare, vitamin and
mineral supplements, spas and travel, and continuing education, all should
benefit from the graying of America. Viagra and other lifestyle drugs are only
one part of this phenomenon. In short, although we are aging, we are not aging
gracefully and show no inclination to change.
One market related answer to Buffalo Springfield's question regarding the future
may possibly be our search to find Ponce de Leon's proverbial fountain of youth.
While many things "ain't exactly clear," the aging process is. We are looking
for ways to profit from this trend.
MARKET COMMENTARY
Performance for Periods Ending March 31, 2004
3 Year 5 Year Since Inception (1/15/98)
QTR 1 Year (annualized) (annualized) (annualized)
----------------------------------------------------------------------
DAVPX 3.00% 33.72% 2.96% 0.89% 3.85%
S&P 500 1.69% 35.12% 0.63% -1.20% 4.27%
Past performance is historical and not representative nor a guarantee of future
results. Current performance may be lower or higher than the data quoted. To
obtain performance data current to the most recent month-end, please contact the
Fund at 1-888-285-1863. The investment and principal value of an investment will
fluctuate. An investor's shares, when redeemed, may be worth more or less than
their original cost. The S&P 500 index is comprised of 500 U. S. stocks and is
an indicator of the performance of the overall stock market. An investor cannot
invest in an index and its returns are not indicative of the performance of any
specific investment.
The bull market's momentum of 2003 rode into the first quarter of 2004 with the
S&P 500 finishing up 35.12% for the year ending March 31, 2004.
The fund for the past year, while performing well by any standard (+33.72%), did
not quite match the return on the S&P 500 owing in part to an underweighting of
industrial and information technology stocks. These two sectors did very well
coming off extremely low price levels after a dismal 2002 and early 2003. A
great deal of optimism has been priced into these sectors in hopes of increased
capital spending and an improving economy. Information technology in particular
saw a number of smaller capitalization stocks revive, but this sector typically
gives us pause if valuations are hard to justify. The agonizing collapse in
technology stock prices during 2000-2002 still stings many investors who chased
these "must own" securities.
Conversely, sectors where we were overweighted versus the S&P 500 performed
well, (energy, health care and consumer staples) but did not carry enough weight
to beat the broad average. The first quarter of 2004 however suggests a shift in
leadership which had our stocks ahead of the average (+3.00% vs. 1.69%) We
believe this trend will continue as the market seeks out larger capitalization
stocks in the shadow of a less friendly Federal Reserve, election uncertainty
and strife in the Middle East.
2
In times of increased market uncertainty, investors tend to flock to the safety
of consumer staples companies and the comfort of their predictable earnings and
attractive dividend streams. In contrast, while energy stock earnings can be
difficult to predict, the larger of the companies pay good dividends and perform
well in times of world unrest. Given the typically lower volatility of these
companies, they have always been well represented in our portfolio. We believe a
cautious investment stance will likely guide investors well into 2004.
Our strategy of investing in less volatile stocks helped us greatly in the 2002
market meltdown. Indeed, our defensive posture and insistence on a diversified
portfolio helped us handily eclipse the S&P 500 over the past three and
five-year periods.
Sincerely,
Davenport & Company, LLC
3
PERFORMANCE INFORMATION
===================================================================================================
DAVENPORT EQUITY FUND
---------------------
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN
THE DAVENPORT EQUITY FUND AND THE STANDARD & POOR'S 500 INDEX
[GRAPHIC OMITTED]
STANDARD & POOR'S 500 INDEX: THE DAVENPORT EQUITY FUND:
--------------------------- -------------------------
QTRLY QTRLY
DATE RETURN BALANCE DATE RETURN BALANCE
---- ------ ------- ---- ------ -------
01/15/98 10,000 01/15/98 10,000
03/31/98 16.25% 11,625 03/31/98 11.40% 11,140
06/30/98 3.30% 12,009 06/30/98 1.39% 11,295
09/30/98 -9.95% 10,815 09/30/98 -11.91% 9,950
12/31/98 21.30% 13,118 12/31/98 15.78% 11,520
03/31/99 4.98% 13,771 03/31/99 4.95% 12,090
06/30/99 7.05% 14,742 06/30/99 5.12% 12,709
09/30/99 -6.24% 13,822 09/30/99 -6.21% 11,920
12/31/99 14.88% 15,878 12/31/99 11.75% 13,320
03/31/00 2.29% 16,242 03/31/00 4.31% 13,894
06/30/00 -2.66% 15,811 06/30/00 -3.15% 13,457
09/30/00 -0.97% 15,658 09/30/00 -0.94% 13,330
12/31/00 -7.82% 14,432 12/31/00 -0.78% 13,226
03/31/01 -11.86% 12,721 03/31/01 -12.44% 11,580
06/30/01 5.85% 13,466 06/30/01 3.33% 11,966
09/30/01 -14.68% 11,489 09/30/01 -10.26% 10,738
12/31/01 10.69% 12,717 12/31/01 9.02% 11,707
03/31/02 0.27% 12,752 03/31/02 1.78% 11,915
06/30/02 -13.40% 11,044 06/30/02 -8.41% 10,913
09/30/02 -17.28% 9,136 09/30/02 -14.89% 9,288
12/31/02 8.44% 9,906 12/31/02 5.52% 9,801
03/31/03 -3.15% 9,594 03/31/03 -3.55% 9,453
06/30/03 15.39% 11,071 06/30/03 14.08% 10,784
09/30/03 2.65% 11,364 09/30/03 3.90% 11,205
12/31/03 12.18% 12,748 12/31/03 9.52% 12,271
03/31/04 1.69% 12,964 03/31/04 3.00% 12,640
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for periods ended March 31, 2004)
1 YEAR 5 YEARS SINCE INCEPTION*
The Davenport Equity Fund 33.72% 0.89% 3.85%
Standard & Poor's 500 Index 35.12% (1.20%) 4.27%
- --------------------------------------------------------------------------------
* Initial public offering of shares was January 15, 1998.
(a) The total returns shown do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
4
THE DAVENPORT EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 2004
================================================================================
ASSETS
Investments in securities:
At acquisition cost ...................................... $ 101,854,778
=============
At market value (Note 1) ................................. $ 123,048,706
Dividends receivable ......................................... 143,120
Receivable for investment securities sold .................... 2,333,599
Receivable for capital shares sold ........................... 270,434
Other assets ................................................. 6,476
-------------
TOTAL ASSETS ............................................. 125,802,335
-------------
LIABILITIES
Dividends payable ............................................ 5,934
Payable for investment securities sold ....................... 3,831,166
Payable for capital shares redeemed .......................... 98,707
Accrued investment advisory fees (Note 3) .................... 78,089
Accrued administration fees (Note 3) ......................... 15,000
Other accrued expenses ....................................... 4,651
-------------
TOTAL LIABILITIES ........................................ 4,033,547
-------------
NET ASSETS ...................................................... $ 121,768,788
=============
Net assets consist of:
Paid-in capital ................................................. $ 109,821,237
Undistributed net investment income ............................. 5,280
Accumulated net realized losses from security transactions ...... (9,251,657)
Net unrealized appreciation on investments ...................... 21,193,928
-------------
Net assets ...................................................... $ 121,768,788
=============
Shares of beneficial interest outstanding (unlimited number of
shares authorized, no par value) ............................... 9,900,924
=============
Net asset value, offering price and redemption price
per share (Note 1) ............................................. $ 12.30
=============
See accompanying notes to financial statements.
5
THE DAVENPORT EQUITY FUND
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 2004
================================================================================
INVESTMENT INCOME
Dividends .................................................... $ 1,378,868
Interest ..................................................... 2,386
-------------
TOTAL INVESTMENT INCOME .................................. 1,381,254
-------------
EXPENSES
Investment advisory fees (Note 3) ............................ 767,241
Administration fees (Note 3) ................................. 157,472
Custodian fees ............................................... 16,926
Professional fees ............................................ 14,991
Postage and supplies ......................................... 13,232
Trustees' fees and expenses .................................. 12,253
Registration fees ............................................ 10,932
Printing of shareholder reports .............................. 9,417
Insurance expense ............................................ 6,611
Other expenses ............................................... 10,275
-------------
TOTAL EXPENSES ........................................... 1,019,350
-------------
NET INVESTMENT INCOME ........................................... 361,904
REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS
Net realized losses from security transactions ............... (1,114,313)
Net change in unrealized appreciation/depreciation
on investments .............................................. 28,283,960
-------------
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS ................ 27,169,647
-------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ...................... $ 27,531,551
=============
See accompanying notes to financial statements.
6
THE DAVENPORT EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
====================================================================================================
YEAR YEAR
ENDED ENDED
MARCH 31, MARCH 31,
2004 2003
- ----------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ........................................... $ 361,904 $ 467,789
Net realized losses from security transactions .................. (1,114,313) (6,068,163)
Net change in unrealized appreciation/depreciation
on investments ................................................. 28,283,960 (12,278,655)
------------ ------------
Net increase (decrease) in net assets from operations .............. 27,531,551 (17,879,029)
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ...................................... (362,957) (483,955)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ....................................... 27,808,350 20,775,106
Net asset value of shares issued in
reinvestment of distributions to shareholders ............... 338,578 461,181
Payments for shares redeemed .................................... (10,020,219) (8,914,951)
------------ ------------
Net increase in net assets from capital share transactions ......... 18,126,709 12,321,336
------------ ------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ............................ 45,295,303 (6,041,648)
NET ASSETS
Beginning of year ............................................... 76,473,485 82,515,133
------------ ------------
End of year ..................................................... $121,768,788 $ 76,473,485
============ ============
UNDISTRIBUTED NET INVESTMENT INCOME ................................ $ 5,280 $ 6,333
============ ============
CAPITAL SHARE ACTIVITY
Sold ............................................................ 2,475,801 2,086,119
Reinvested ...................................................... 29,749 47,857
Redeemed ........................................................ (886,698) (897,541)
------------ ------------
Net increase in shares outstanding .............................. 1,618,852 1,236,435
Shares outstanding at beginning of year ......................... 8,282,072 7,045,637
------------ ------------
Shares outstanding at end of year ............................... 9,900,924 8,282,072
============ ============
See accompanying notes to financial statements.
7
THE DAVENPORT EQUITY FUND
FINANCIAL HIGHLIGHTS
==========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR
- ----------------------------------------------------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
2004 2003 2002 2001 2000
- ----------------------------------------------------------------------------------------------------------
Net asset value at beginning of year ........ $ 9.23 $ 11.71 $ 11.42 $ 13.75 $ 12.01
--------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income .................... 0.04 0.06 0.04 0.05 0.04
Net realized and unrealized gains
(losses) on investments .............. 3.07 (2.48) 0.29 (2.34) 1.75
--------- --------- --------- --------- ---------
Total from investment operations ............ 3.11 (2.42) 0.33 (2.29) 1.79
--------- --------- --------- --------- ---------
Less distributions:
Dividends from net investment income ..... (0.04) (0.06) (0.04) (0.04) (0.05)
--------- --------- --------- --------- ---------
Net asset value at end of year .............. $ 12.30 $ 9.23 $ 11.71 $ 11.42 $ 13.75
========= ========= ========= ========= =========
Total return (a) ............................ 33.72% (20.66%) 2.89% (16.65%) 14.93%
========= ========= ========= ========= =========
Net assets at end of year (000's) ........... $ 121,769 $ 76,473 $ 82,515 $ 70,160 $ 77,626
========= ========= ========= ========= =========
Ratio of net expenses to average
net assets ............................... 1.00% 1.04% 1.02% 1.00% 1.01%
Ratio of net investment income to
average net assets ....................... 0.35% 0.62% 0.35% 0.36% 0.35%
Portfolio turnover rate ..................... 25% 18% 13% 25% 17%
(a) Total returns are a measure of the change in value of an investment in the
Fund over the periods covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or the
redemption of Fund shares.
See accompanying notes to financial statements.
8
THE DAVENPORT EQUITY FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 2004
================================================================================
SHARES COMMON STOCKS -- 95.1% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 13.3%
80,645 CarMax, Inc. (a) ............................. $ 2,354,834
41,500 Estee Lauder Companies, Inc. - Class A ....... 1,840,110
26,865 E.W. Scripps Company - Class A (The) ......... 2,716,320
91,530 Fox Entertainment Group, Inc. (a) ............ 2,480,463
44,850 Harrah's Entertainment, Inc. ................. 2,461,817
54,668 International Game Technology, Inc. .......... 2,457,873
33,000 Lowe's Companies, Inc. ....................... 1,852,290
------------
16,163,707
------------
CONSUMER STAPLES -- 10.9%
67,291 Anheuser-Busch Companies, Inc. ............... 3,431,841
56,425 Coca-Cola Company (The) ...................... 2,838,178
115,870 SYSCO Corporation ............................ 4,524,724
74,371 Walgreen Company ............................. 2,450,524
------------
13,245,267
------------
ENERGY -- 7.9%
27,986 BP Amoco PLC - ADR ........................... 1,432,883
29,609 EOG Resources, Inc. .......................... 1,358,757
56,939 Exxon Mobil Corporation ...................... 2,368,093
41,394 Murphy Oil Corporation ....................... 2,606,580
28,467 Schlumberger Limited ......................... 1,817,618
------------
9,583,931
------------
FINANCIALS -- 18.1%
53,496 American Express Company ..................... 2,773,768
24,032 Bank Of America Corporation .................. 1,946,111
71,450 Bank Of New York Co., Inc. (The) ............. 2,250,675
758 Berkshire Hathaway, Inc. - Class B (a) ....... 2,358,146
40,366 Capital One Financial Corporation ............ 3,044,807
31,395 Hilb, Rogal & Hamilton Company ............... 1,196,150
39,754 Jefferson-Pilot Corporation .................. 2,186,868
11,411 Markel Corporation (a) ....................... 3,285,227
43,378 SunTrust Banks, Inc. ......................... 3,023,880
------------
22,065,632
------------
HEALTHCARE -- 13.9%
31,747 AMERIGROUP Corporation (a) ................... 1,450,838
42,672 Amgen, Inc. (a) .............................. 2,482,230
27,175 Anthem, Inc. (a) ............................. 2,463,142
55,140 Johnson & Johnson ............................ 2,796,701
29,539 Medtronic, Inc. .............................. 1,410,487
59,937 Pfizer, Inc. ................................. 2,100,792
46,808 Wyeth ........................................ 1,757,640
32,929 Zimmer Holdings, Inc. (a) .................... 2,429,502
------------
16,891,332
------------
9
THE DAVENPORT EQUITY FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 95.1%(CONTINUED) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 7.0%
46,953 First Data Corporation ....................... $1,979,538
25,985 General Dynamics Corporation ................. 2,321,240
67,432 General Electric Company ..................... 2,058,025
148,209 Tredegar Corporation ......................... 2,168,298
------------
8,527,101
------------
INFORMATION TECHNOLOGY -- 10.4%
116,589 Cisco Systems, Inc. (a) ...................... 2,742,173
84,630 Dell Computer Corporation (a) ................ 2,845,261
69,962 Intel Corporation ............................ 1,902,966
27,616 International Business Machines Corporation .. 2,536,254
106,162 Microsoft Corporation ........................ 2,650,865
------------
12,677,519
------------
MATERIALS -- 5.1%
49,444 Dow Chemical Company (The) ................... 1,991,604
63,926 Praxair, Inc. ................................ 2,372,933
18,500 Rio Tinto PLC - ADR .......................... 1,860,730
------------
6,225,267
------------
TELECOMMUNICATIONS SERVICES -- 6.3%
132,923 America Movil S.A. de C.V. - Series L - ADR .. 5,137,474
127,412 Nokia Corporation - ADR ...................... 2,583,915
------------
7,721,389
------------
UTILITIES -- 2.2%
41,248 Dominion Resources, Inc. ..................... 2,652,246
------------
TOTAL COMMON STOCKS (Cost $94,559,449) ....... $115,753,391
------------
================================================================================
PAR VALUE U.S. TREASURY OBLIGATIONS-- 1.6% VALUE
- --------------------------------------------------------------------------------
$2,000,000 U.S. Treasury Bill, due 04/29/2004
(Cost $1,998,530) ........................... $ 1,998,516
------------
================================================================================
SHARES MONEY MARKETS -- 4.4% VALUE
- --------------------------------------------------------------------------------
5,296,799 First American Treasury Obligation Fund -
Class S (Cost $5,296,799) ................... $ 5,296,799
------------
TOTAL INVESTMENTS AT VALUE-- 101.1%
(Cost $101,854,778) ......................... $123,048,706
LIABILITIES IN EXCESS OF OTHER ASSETS-- (1.1)% ( 1,279,918)
------------
NET ASSETS-- 100.0% .......................... $121,768,788
============
(a) Non-income producing security.
ADR - American Depository Receipt
See accompanying notes to financial statements.
10
THE DAVENPORT EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2004
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Davenport Equity Fund (the Fund) is a no-load, diversified series of the
Williamsburg Investment Trust (the Trust), an open-end management investment
company registered under the Investment Company Act of 1940. The Trust was
organized as a Massachusetts business trust on July 18, 1988. The Fund began
operations on January 15, 1998.
The Fund's investment objective is long term growth of capital through
investment in a diversified portfolio of common stocks. Current income is
incidental to this objective and may not be significant.
The following is a summary of the Fund's significant accounting policies:
Securities valuation -- The Fund's portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities which are traded over-the-counter
are valued at the last sales price, if available, otherwise, at the last quoted
bid price. Securities traded on a national stock exchange are valued based upon
the closing price on the principal exchange where the security is traded.
Securities which are quoted by NASDAQ are valued at the NASDAQ Official Closing
Price. Fixed income securities will ordinarily be traded in the over-the-counter
market and common stocks will ordinarily be traded on a national securities
exchange, but may also be traded in the over-the-counter market. When market
quotations are not readily available, fixed income securities may be valued on
the basis of prices provided by an independent pricing service. Short-term
instruments (those with remaining maturities of 60 days or less) are valued at
amortized cost, which approximates market value. Securities and other assets for
which no quotations are readily available will be valued in good faith at fair
value using methods determined by the Board of Trustees. Such methods of fair
valuation may include, but are not limited to: multiple of earnings, multiple of
book value, discount from market of a similar freely traded security, purchase
price of security, subsequent private transactions in the security or related
securities, or combination of these and other factors.
Repurchase agreements -- The Fund may enter into joint repurchase agreements
with other funds within the Trust. The joint repurchase agreement, which is
collateralized by U.S. Government obligations, is valued at cost which, together
with accrued interest, approximates market. At the time the Fund enters into the
joint repurchase agreement, the seller agrees that the value of the underlying
securities, including accrued interest, will at all times be equal to or exceed
the face amount of the repurchase agreement. In addition, the Fund actively
monitors and seeks additional collateral, as needed.
Share valuation -- The net asset value per share of the Fund is calculated daily
by dividing the total value of the Fund's assets, less liabilities, by the
number of shares outstanding. The offering price and redemption price per share
of the Fund is equal to the net asset value per share.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed-income
securities purchased are amortized using the interest method.
Security transactions -- Security transactions are accounted for on trade date.
Securities sold are determined on a specific identification basis.
Common expenses -- Common expenses of the Trust are allocated among the funds of
the Trust based on relative net assets of each fund or the nature of the
services performed and the relative applicability to each fund.
Distributions to shareholders -- Dividends arising from net investment income
are declared and paid quarterly to shareholders of the Fund. Net realized
short-term capital gains, if any, may be distributed throughout the year and net
realized long-term capital gains, if any, are distributed at least once each
year. The amount of distributions from net investment income and net realized
gains are determined in accordance with federal income tax regulations which may
differ from accounting principles generally accepted in the United States. There
were no differences between the book basis and tax basis of distributions for
the years ended March 31, 2004 and 2003.
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of income and expenses during the reporting period. Actual results could
differ from those estimates.
11
THE DAVENPORT EQUITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Federal income tax -- It is the Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which a Fund so
qualifies and distributes at least 90% of its taxable net income, the Fund (but
not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also the Fund's intention to declare as dividends in
each calendar year at least 98% of its net investment income (earned during the
calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is computed on a tax basis for each item as of March
31, 2004:
- --------------------------------------------------------------------------------
Cost of portfolio investments ................................... $ 101,899,946
=============
Gross unrealized appreciation ................................... $ 24,802,875
Gross unrealized depreciation ................................... (3,654,115)
-------------
Net unrealized appreciation ..................................... $ 21,148,760
Undistributed ordinary income ................................... 11,214
Capital loss carryforwards ...................................... (9,206,489)
Other temporary differences ..................................... (5,934)
-------------
Accumulated earnings ............................................ $ 11,947,551
=============
- --------------------------------------------------------------------------------
The difference between the federal income tax cost of portfolio investments and
the financial statement cost is due to certain timing differences in the
recognition of capital gains or losses under income tax regulations and
accounting principles generally accepted in the United States. These "book/tax"
differences are temporary in nature and result from the tax deferral of losses
on wash sales.
As of March 31, 2004, the Fund had the following capital loss carryforwards for federal income tax purposes:
- ------------------------------------------------------------------------------------------------------------
Amount Expires March 31,
- ------------------------------------------------------------------------------------------------------------
Davenport Equity Fund $ 154,428 2008
1,875,902 2010
5,066,211 2011
2,109,948 2012
------------
$ 9,206,489
============
- ------------------------------------------------------------------------------------------------------------
These capital loss carryforwards may be utilized in future years to offset net
realized capital gains, if any, prior to distributing such gains to
shareholders.
2. INVESTMENT TRANSACTIONS
During the year ended March 31, 2004, cost of purchases and proceeds from sales
and maturities of investment securities, other than short-term investments and
U.S. government securities, amounted to $39,924,676 and $24,164,501,
respectively.
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Fund's investments are managed by Davenport & Company LLC (the Adviser)
under the terms of an Investment Advisory Agreement. Under the Investment
Advisory Agreement, the Fund pays the Adviser a fee, which is computed and
accrued daily and paid monthly, at an annual rate of .75% of its average daily
net assets. Certain officers of the Trust are also officers of the Adviser.
12
THE DAVENPORT EQUITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Fund. For these services, Ultimus receives a monthly fee from
the Fund at an annual rate of .15% on its average daily net assets up to $25
million; .125% on the next $25 million of such net assets; and .10% on such net
assets in excess of $50 million, plus a shareholder recordkeeping fee at the
annual rate of $10 per shareholder account in excess of 1,000 accounts. In
addition, the Fund pays out-of-pocket expenses including, but not limited to,
postage, supplies and costs of pricing the Fund's portfolio securities. Certain
officers of the Trust are also officers of Ultimus, or of Ultimus Fund
Distributors, LLC, the principal underwriter of the Fund's shares and an
affiliate of Ultimus.
4. CONTINGENCIES AND COMMITMENTS
The Fund indemnifies the Trust's officers and trustees for certain liabilities
that might arise from their performance of their duties to the Fund.
Additionally, in the normal course of business the Fund enters into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Fund's maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Fund that have not yet occurred. However, based on experience, the Fund expects
the risk of loss to be remote.
13
REPORT OF INDEPENDENT AUDITORS
================================================================================
To the Board of Trustees and Shareholders of
The Davenport Equity Fund
of the Williamsburg Investment Trust
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of The Davenport Equity Fund (the "Fund") (a
series of Williamsburg Investment Trust) as of March 31, 2004, and the related
statements of operations and changes in net assets and financial highlights for
the year then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit. The statement of changes in net assets and financial highlights for the
respective years ended March 31, 2003 were audited by other auditors. Those
auditors expressed an unqualified opinion on the statement of changes in net
assets and financial highlights in their report dated April 25, 2003.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of March 31, 2004, by correspondence with the custodian and brokers. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides 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 The
Davenport Equity Fund as of March 31, 2004, the results of its operations, the
changes in its net assets and its financial highlights for the year then ended,
in conformity with accounting principles generally accepted in the United
States.
/s/ Ernst & Young LLP
Cincinnati, Ohio
May 6, 2004
14
BOARD OF TRUSTEES AND EXECUTIVE OFFICERS
(UNAUDITED)
================================================================================
Overall responsibility for management of the Fund rests with the Board of
Trustees. The Trustees serve during the lifetime of the Trust and until its
termination, or until death, resignation, retirement or removal. The Trustees,
in turn, elect the officers of the Fund to actively supervise its day-to-day
operations. The officers have been elected for an annual term. The following are
the Trustees and executive officers of the Fund:
POSITION HELD LENGTH OF
TRUSTEE ADDRESS AGE WITH THE TRUST TIME SERVED
- -----------------------------------------------------------------------------------------------------------------------------------
*Charles M. Caravati, Jr. 931 Broad Street Road, Manakin-Sabot, VA 67 Chairman and Trustee Since June 1991
*Austin Brockenbrough III 1802 Bayberry Court, Suite 400, Richmond, VA 67 Trustee Since September 1988
*John T. Bruce 800 Main Street, Lynchburg, VA 50 Trustee Since September 1988
J. Finley Lee 200 Westminster Drive, Chapel Hill, NC 64 Trustee Since September 1988
*Richard Mitchell 150 Government Street, Mobile, AL 54 Trustee Since June 1991
Richard L. Morrill University of Richmond, Richmond, VA 64 Trustee Since March 1993
Harris V. Morrissette 100 Jacintoport Boulevard, Saraland, AL 44 Trustee Since March 1993
Erwin H. Will, Jr. 47 Willway Avenue, Richmond, VA 71 Trustee Since July 1997
Samuel B. Witt III 2300 Clarendon Boulevard, Suite 407, Arlington, VA 68 Trustee Since November 1988
Joseph L. Antrim III One James Center, 901 E. Cary Street, Richmond, VA 58 President Since November 1997
John P. Ackerly IV One James Center, 901 E. Cary Street, Richmond, VA 40 Vice President Since November 1997
J. Lee Keiger III One James Center, 901 E. Cary Street, Richmond, VA 49 Vice President Since November 1997
Robert G. Dorsey 135 Merchant Street, Suite 230, Cincinnati, OH 47 Vice President Since November 2000
Mark J. Seger 135 Merchant Street, Suite 230, Cincinnati, OH 42 Treasurer Since November 2000
John F. Splain 135 Merchant Street, Suite 230, Cincinnati, OH 47 Secretary Since November 2000
*Messrs. Bruce, Brockenbrough, Caravati and Mitchell are "interested persons" of
the Trust within the meaning of Section 2(a)(19) of the Investment Company Act
of 1940. Charles M. Caravati, Jr. is the father of Charles M. Caravati III, an
officer of The Jamestown Funds, which are other portfolios of the Trust.
Each Trustee oversees eleven portfolios of the Trust, including the Fund. The
principal occupations of the Trustees and executive officers of the Fund during
the past five years and public directorships held by the Trustees are set forth
below:
Charles M. Caravati, Jr. is a retired physician. He is also the retired
President of Dermatology Associates of Virginia, P.C.
Austin Brockenbrough III is President and Managing Director of Lowe,
Brockenbrough & Company, Inc. (an investment advisory firm). He is a member of
the Board of Directors of Tredegar Corporation (a plastics manufacturer) and
Wilkinson O'Grady & Co., Inc. (a global asset manager). In addition, he is a
member of the Board of Trustees for the University of Richmond.
John T. Bruce is a Principal of Flippin, Bruce & Porter, Inc. (an investment
advisory firm).
J. Finley Lee is a financial consultant and the Julian Price Professor Emeritus
at the University of North Carolina.
Richard Mitchell is a Principal of T. Leavell & Associates, Inc. (an investment
advisory firm).
Richard L. Morrill is the Chancellor of the University of Richmond. He is also a
member of the Board of Directors of Tredegar Corporation and Albemarle
Corporation (polymers and chemical manufacturer).
15
BOARD OF TRUSTEES AND EXECUTIVE OFFICERS
(UNAUDITED) (CONTINUED)
================================================================================
Harris V. Morrissette is President of Marshall Biscuit Co., Inc. He is a member
of the Board of Directors of BancTrust Financial Group, Inc. (a bank holding
company) and EnergySouth, Inc. In addition, he is Chairman of Azalea Aviation,
Inc. (an airplane fueling company).
Erwin H. Will, Jr. is the retired Managing Director of Equities of Virginia
Retirement System.
Samuel B. Witt III is Senior Vice President and General Counsel of Stateside
Associates, Inc. He is also a member of the Board of Directors of The Swiss
Helvetia Fund, Inc. (a closed-end investment company).
Joseph L. Antrim III is Executive Vice President of the Adviser.
John P. Ackerly IV is Vice President and Portfolio Manager of the Adviser.
J. Lee Keiger III is First Vice President and Chief Financial Officer of the
Adviser.
Robert G. Dorsey is a Managing Director of Ultimus Fund Solutions, LLC and
Ultimus Fund Distributors, LLC.
Mark J. Seger is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
John F. Splain is a Managing Director of Ultimus Fund Solutions, LLC and Ultimus
Fund Distributors, LLC.
Additional information about members of the Board of Trustees and executive
officers is available in the Statement of Additional Information (SAI). To
obtain a free copy of the SAI, please call 1-800-281-3217.
CHANGE IN INDEPENDENT AUDITOR (UNAUDITED)
================================================================================
On February 17, 2004, Tait, Weller & Baker was replaced as independent auditor
of the Fund, and Ernst & Young LLP (Ernst & Young) was selected as the Fund's
new independent auditor. The Fund's selection of Ernst & Young as its
independent auditor was recommended and approved by the Fund's audit committee
and was ratified by the Board of Trustees.
Tait, Weller & Baker's reports on the Fund's financial statements for the past
two fiscal years did not contain an adverse opinion or a disclaimer of opinion,
and were not qualified or modified as to uncertainty, audit scope or accounting
principles. During such fiscal years, and through the date of Tait, Weller &
Baker's replacement, there were no disagreements between the Fund and Tait,
Weller & Baker on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedures, which disagreements, if
not resolved to the satisfaction of Tait, Weller & Baker, would have caused it
to make reference to the subject matter of the disagreements in connection with
its reports on the financial statements for such years.
FEDERAL TAX INFORMATION (UNAUDITED)
================================================================================
For the fiscal year ended March 31, 2004 certain dividends paid by the Fund may
be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth
Tax Relief Reconciliation Act of 2003. The Fund intends to designate up to a
maximum amount of $362,957 as taxed at a maximum rate of 15%. Additionally, for
the fiscal year ended March 31, 2004, 100% of the dividends paid from ordinary
income qualified for the dividends received deduction for corporations. Complete
information will be computed and reported in conjunction with your 2004 Form
1099-DIV.
16
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ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted a
code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions, regardless of whether these individuals
are employed by the registrant or a third party. Pursuant to Item 10(a)(1), a
copy of registrant's code of ethics is filed as an exhibit to this Form N-CSR.
During the period covered by this report, the code of ethics has been amended,
but not in a manner that relates to any element of the code of ethics enumerated
in paragraph (b) of this Item. The registrant has not granted any waivers,
including implicit waivers, from the provisions of the code of ethics.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's board of trustees has determined that the registrant has at
least one audit committee financial expert serving on its audit committee. The
name of the audit committee financial expert is Erwin H. Will, Jr. Mr. Will is
"independent" for purposes of this Item.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) AUDIT FEES. The aggregate fees billed for professional services
rendered by the principal accountant for the audit of the registrant's
annual financial statements or for services that are normally provided
by the accountant in connection with statutory and regulatory filings
or engagements were $110,000 with respect to the registrant's fiscal
year ended March 31, 2004. The aggregate fees billed for professional
services rendered by the registrant's former principal accountant for
the audit of the registrant's annual financial statements or for
services that are normally provided by the accountant in connection
with the statutory and regulatory filings or engagements were $99,000
with respect to the registrant's fiscal year ended March 31, 2003.
(b) AUDIT-RELATED FEES. No fees were billed in either of the last two
fiscal years for assurance and related services by the principal
accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item.
(c) TAX FEES. No fees were billed in either of the last two fiscal years
for professional services rendered by the principal accountant for tax
compliance, tax advice, and tax planning.
(d) ALL OTHER FEES. No fees were billed in either of the last two fiscal
years for products and services provided by the principal accountant,
other than the services reported in paragraphs (a) through (c) of this
Item.
(e)(1)The audit committee has not adopted pre-approval policies and
procedures described in paragraph (c)(7) of Rule 2-01 of Regulation
S-X.
(e)(2)None of the services described in paragraph (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) Less than 50% of hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most
recent fiscal year were attributed to work performed by persons other
than the principal accountant's full-time, permanent employees.
(g) No non-audit fees were billed in either of the last two fiscal years
by the registrant's accountant for services rendered to the
registrant, and rendered to the registrant's investment adviser (not
including any sub-adviser whose role is primarily portfolio management
and is subcontracted with or overseen by another investment adviser),
and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant.
(h) The registrant's audit committee has not considered whether the
provision of non-audit services to the registrant's investment adviser
(not including any sub-adviser whose role is primarily portfolio
management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to
the registrant, that were not pre-approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X, is compatible with
maintaining the principal accountant's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant's Nominating Committee does not currently consider for nomination
candidates proposed by shareholders for election to the registrant's board of
trustees.
ITEM 10. CONTROLS AND PROCEDURES.
(a)(1) Based on their evaluation of the registrant's disclosure controls and
procedures (as defined in Rule 301-2(c) under the Investment Company Act of
1940), the registrant's principal executive officers and principal financial
officer have concluded that such disclosure controls and procedures are
reasonably designed and are operating effectively to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to them by others within those entities, particularly during the
period in which this report is being prepared, and that the information required
in filings on Form N-CSR is recorded, processed, summarized, and reported on a
timely basis.
(a)(2) There were no significant changes in the registrant's internal control
over financial reporting that occurred during the registrant's most recent
fiscal half-year (the registrant's second fiscal half-year in the case of an
annual report) that have materially affected, or are reasonably likely to
materially affect, the registrant's internal control over financial reporting.
ITEM 11. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Attached hereto
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Act (17 CFR 270.30a-2(a)): Attached hereto
(b) Certifications required by Rule 30a-2(b) under the Act (17 CFR
270.30a-2(b)): Attached hereto
Exhibit 99.CODE ETH Code of Ethics
Exhibit 99.CERT Certifications pursuant to Section 302 of the Sarbanes-
Oxley Act of 2002
Exhibit 99.906CERT Certifications pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Williamsburg Investment Trust
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By (Signature and Title)* /s/ John F. Splain
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John F. Splain, Secretary
Date June 4, 2004
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Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John T. Bruce
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John T. Bruce, President (FBP Contrarian Equity Fund
and FBP Contrarian Balanced Fund)
Date June 4, 2004
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By (Signature and Title)* /s/ Richard Mitchell
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Richard Mitchell, President (The Government Street
Equity Fund, The Government Street Bond Fund
and The Alabama Tax Free Bond Fund)
Date June 4, 2004
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By (Signature and Title)* /s/ Charles M. Caravati III
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Charles M. Caravati III, President (The Jamestown
Balanced Fund, The Jamestown Equity Fund and
The Jamestown International Equity Fund)
Date June 4, 2004
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By (Signature and Title)* /s/ Beth Ann Gustafson
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Beth Ann Gustafson, President (The Jamestown
Tax Exempt Virginia Fund)
Date June 4, 2004
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By (Signature and Title)* /s/ Joseph L. Antrim III
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Joseph L. Antrim III, President (The Davenport
Equity Fund)
Date June 4, 2004
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By (Signature and Title)* /s/ Mark J. Seger
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Mark J. Seger, Treasurer
Date June 4, 2004
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* Print the name and title of each signing officer under his or her signature.